REG - Metals Exploration - Quarterly Update To 31 March 2025

Metals ExplorationAnnouncement

23/04/2025 07:00

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RNS Number : 7471F  Metals Exploration PLC  23 April 2025

METALS EXPLORATION PLC

 

QUARTERLY UPDATE TO 31 March 2025

 

Metals Exploration plc (AIM: MTL) ("Metals Exploration", the "Company" or the
"Group"), a gold production, exploration, and development company with assets
in the Philippines and Nicaragua, is pleased to announce its unaudited
quarterly results for Q1 2025 (the "Quarter").

 

Corporate

·      Completed the acquisition of 100% of Condor Gold plc ("Condor
Gold") on 15 January 2025.

·      Appointment of Steven Smith as Chairman of the Board replacing
Nick von Schirnding in March 2025.

 

Finance

·      Q1 2025 positive free cash flow of US$23.5 million (Q4 2024:
US$22.5 million).

·      Q1 2025 gold revenue of US$48.4 million (Q4 2024: US$47.5
million).

·      Q1 2025 gold sales of 18,219 ounces sold at an average realised
gold price of US$2,661 per ounce (Q4 2024: 19,144 ounces at an average
US$2,481 per ounce).

·      Repayment of the principal and interest pertaining to its £5.5
million short-term bridging loan via the transfer from Treasury of 94,127,854
ordinary shares at an issue price of 6p per share.

 

Mining Operations

·      After over 26 million hours worked without a lost time injury,
the Company suffered its first lost time injury since December 2016 on 30
March 2025.

·      Q1 2025 mining production of ore and waste was 2.90 million
tonnes ("Mt") (Q4 2024: 2.70Mt), with a total of 503 thousand tonnes ("Kt") of
ore mined in Q1 2025 (Q4 2024: 284Kt).

 

Processing Operations

·      Q1 2025 gold production of 20,992 ounces (Q4 2024: 18,829 ounces)
recovered from 537Kt at a head grade of 1.34 grammes per tonne ("g/t") (Q4
2024: 530Kt at a head grade of 1.17 g/t).

·      Q1 2025 all-in-sustaining-cost ("AISC") of US$1,303 per ounce
("p/oz") (Q4 2024: US$1,289 p/oz).

·      Q1 2025 gold recovery of 90.7% (Q4 2024: 94.5%).

 

Development - La India, Nicaragua

·      Appointment of key personnel to Nicaraguan management positions.

·      Purchase of a fit for purpose second hand plant.

·      Appointment of GRES Engineering of Brisbane, Australia, as
project engineers.

·      Tierra Group appointed to design and construct the tailings
facility.

·      Tenders for earthworks and concrete issued.

·      Exploration programme developed with drill rigs mobilising in Q2
2025.

 

Exploration - Philippines

·      Drilling at the Abra project delayed until Q3 2025.

·      Dupax project mapping and geochemistry ongoing, geophysics
programme to commence in April 2025.

 

Darren Bowden, CEO of Metals Exploration, commented:

 

"I am pleased to report a successful start to 2025, with the completion of the
acquisition of Condor Gold in January, marking the beginning of an exciting
new development for the Company. We have had a busy Q1 following completion,
which included the recruitment of our Nicaraguan in-country management team,
the design of a gold resource extension and verification drill programme, and
the purchase of a fit for purpose gold ore processing and concentrating plant.
This puts us in a good position to reach first gold pour at the end of 2026,
as we recently re-affirmed.

 

"We had a strong quarter financially, with positive free cash flow and gold
revenue up on Q4 2024. There was also an increase in our processing operations
compared to the previous quarter, with gold production of 20,992 ounces in Q1
2025. This was an excellent start to the year, and we hope to continue with
this strong performance as the year goes on.

 

"Unfortunately, one of our colleagues at Runruno suffered an injury at the end
of March and is undergoing medical care in Manilla. We are investigating how
this incident occurred and will support him during his recovery. Safety of our
employees is our number one priority, and we are saddened by this news."

 

Runruno Production and Finance Summary

 

 Runruno Project Report                       Quarter    Quarter                              FY 2025    FY 2024
 FY 2025                                      Actual     Actual                               Actual     Actual
 PHYSICALS                      Units         Q1 2025    Q1 2024                              3 Months   3 Months
 Mining
 Ore Mined                      Tonnes        503,463    677,663                              503,463    677,663
 Waste Mined                    Tonnes        2,432,347  2,630,225                            2,432,347  2,630,225
 Total Mined                    Tonnes        2,935,810  3,307,888                            2,935,810  3,307,888
 Au Grade Mined                 g/tonne       1.69       1.35                                 1.69       1.35
 Strip Ratio                                  4.79       3.99                                 4.79       3.99
 Processing
 Ore Milled                     Tonnes        537,233    580,719                              537,233    580,719
 Au Grade                       g/tonne       1.34       1.37                                 1.34       1.37
 S(2) Grade                     %             1.16       1.41                                 1.16       1.41
 Au Milled (contained)          Ounces        23,139     25,574                               23,139     25,574
 Recovery                       %             90.7                      90.0                  90.7                      90.0
 Au Recovered/Poured            Ounces        20,992     23,006                               20,992     23,006
 Sales
 Au Sold                        Ounces        18,219     21,465                               18,219     21,465
 Au Price                       US$/oz        2,661      2,069                                2,661      2,069
 FINANCIALS (Unaudited)
 Revenue
 Gold Sales                     (US$000's)    48,476     44,401                               48,476     44,401
 Operating Costs - Summary
 Mining                         (US$000's)    4,790      5,160                                4,790      5,160
 Processing                     (US$000's)    8,463      9,136                                8,463      9,136
 G&A                            (US$000's)    3,882      2,950                                3,882      2,950
 Total Operating Costs          (US$000's)    17,134     17,246                               17,134     17,246
 Excise Duty                    (US$000's)    1,952      1,774                                1,952      1,774
 UK/Philippine G&A              (US$000's)    3,972      1,671                                3,972      1,671
 Total Direct Production Costs  (US$000's)    23,058     20,691                               23,058     20,691
 Net Cash Income                (US$000's)    27,804     23,710                               27,804     23,710
 Total Capital Costs            (US$000's)    1,881      2,143                                1,881      2,143
 Total non-cash costs           (US$000's)    16,233     9,204                                16,233     9,204
 Free Cashflow                  (US$000's)    23,536     21,567                               23,536     21,567
 Cash Cost / oz Sold - C1       US$/oz        875        791                                  875        791
 Cash Cost / oz Sold - AISC(1)  US$/oz        1,303      1,051                                1,303      1,051

 

Note 1: AISC includes all UK Corporate costs, excluding costs directly related
to the Nicaraguan assets.

Corporate

 

Condor Gold plc Acquisition and La India Gold Project Development

 

On 15 January 2025, the Company completed the acquisition of 100% of Condor
Gold, which is the 100% owner of an extensive highly prospective tenement
package in Nicaragua, including the La India gold resource. Refer to previous
announcements in relation to the Condor Gold takeover, which can be found on
the Company's website
(https://metalsexploration.com/investors/recommended-offer-for-condor-gold-plc-2/)
.

 

Having taken management control of the Condor Gold Nicaraguan assets during
the Quarter, Metals Exploration executives have established new relationships
with the necessary key government department representatives. Ongoing
government support for the development of La India has been received.

 

The Company is well advanced in the appointment of its key Spanish speaking
management team in Nicaragua. The selection of development and construction
firms is also well advanced and a 'ground-breaking' ceremony at La India
expected to be held in early May 2025.

 

Activities undertaken in Q1 2025 in relation to the Nicaraguan assets
included:

·      Recruitment of key Spanish speaking executives to join the
Nicaraguan in-country management team, including the General Manager, VP
Sustainability and Project Manager - Construction;

·      Ongoing review of the current gold reserve and resource
statements;

·      Design of a gold resource extension and verification drill
programme and issue of tenders to undertake the proposed drill programme,
which is expected to commence in May;

·      Purchase of a fit for purpose second hand gold ore processing and
concentrating plant (including crushers, conveyors, grinding ball mill,
gravity circuit, elution, smelting equipment and laboratory, and all component
and construction drawings). This plant is being shipped to site from North
America and is scheduled to land in Nicaragua in Q3 2025;

·      Appointment of GRES Engineering of Brisbane, Australia as the La
India project engineers who have commenced the detailed design for
construction of the La India project;

·      Appointment of Tierra Group to design and construct the La India
tailings facility; and

·      Issue of tenders for the La India earthworks, concrete and fuel
supply - expected to be awarded in Q2 2025.

 

Non-Executive Director Resignation

 

On 20 March 2025, Nick von Schirnding resigned as Chairman and Non-Executive
Director. Steven Smith was appointed Chairman of the Board following Mr von
Schirnding's resignation.

 

Runruno Operations

 

During Q1 2025, operations at Runruno produced another set of strong results
for the Company with gold sales of US$48.5 million (Q4 2024: US$47.5 million),
at an average realised gold price of US$2,661 per ounce (Q4 2024: average gold
price of US$2,481 per ounce); producing a positive free cash flow of US$23.5
million (Q4 2024: US$22.5 million).

 

Finance

 

In January 2025, the Company paid US$24.7 million (£20.3 million) to Condor
Gold shareholders as part consideration for the takeover of Condor Gold.

 

On 10 March 2025, the Company repaid the principal and interest pertaining to
its £5.5 million short-term bridging loan via the transfer from Treasury of
94,127,854 ordinary shares at an issue price of 6p per share.

 

The Company's cash holdings at 31 March 2025 were US$20.7 million (31 December
2024: US$32.0 million).  The Group has no debt.

 

 

Mining Operations

 

Mining production of ore and waste for Q1 2025 was slightly below management's
forecast at 2.90Mt (Q4 2024: 2.70Mt). During Q1 2025, a total of 503Kt of ore
was mined (Q4 2024: 284kt).

 

Process Plant

 

During Q1 2025 most aspects of the process plant performed adequately
producing a quarter average recovery rate of 90.7% (Q4 2024: 94.5%).

 

Gold produced during Q1 2025 was 20,992 ounces (Q4 2024: 18,829 ounces) from
ore milled in Q1 2025 of 537Kt (Q4 2024: 530Kt), at an AISC of US$1,303 p/oz
(Q4 2024: US$1,289 p/oz). Head grade was slightly higher than forecast at 1.34
g/t (Q4 2024: 1.17 g/t).

 

The main sources of unplanned downtime, which was within forecast, included
repairs to the return discharge line, trommel panel screens and conveyor belts
together with booster pump replacement and final tails line pumps changeover.

 

Residual Storage Impoundment ("RSI")

 

The RSI dam-wall is at its final height and the dam water freeboard remains
well above design minimum levels. Construction of the RSI final in-rock
spillway continues.

 

Occupational Health & Safety

 

Runruno's exceptional safety record of over 26 million hours worked without a
lost time injury ended on 30 March 2025 when a fuel line to an oxygen tank
ruptured and caught fire (the cause of which is under investigation). One
employee suffered 1(st) and 2(nd) degree burns to approximately 30% of his
body and is receiving treatment in Manila. He is expected to make a full
recovery and return to work in Q2 2025.

 

Environment & Compliance

 

Compliance matters continue to be successfully monitored, and the mine remains
compliant with no outstanding material issues.

 

Community & Government Relations

 

The Company continues to receive strong support from local communities and
government agencies.

 

Exploration - Philippines

 

Abra Project

Drill programmes for the initial key target areas of the Abra project area
have been designed, however, the Company has deferred the start of these
programmes to late Q2 or early Q3 2025 to allow the National Commission for
Indigenous Peoples ('NCIP') to further advance their consultation activities
with the impacted local communities.

 

Dupax Project

During the Quarter, the Dupax geochemistry activities at the Dupax project
area continued. The Dupax project is 20 kilometres from the Runruno mine and
has the potential to extend ore processing operations at Runruno after ore
feed from the Runruno FTAA tenement (Financial and Technical Assistance
Agreement) is exhausted. The potential ore feed from Dupax could utilise the
existing Runruno process plant infrastructure and be re-purposed to
accommodate a different type of ore feed.

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014, which forms part of United Kingdom domestic law by
virtue of the European Union (Withdrawal) Act 2018 (as amended). Upon the
publication of this announcement, this inside information is now considered to
be in the public domain.

END

For further information, please contact or visit:

 

 Metals Exploration PLC
 Via BlytheRay                            +44 (0) 207 138 3204

 Nominated & Financial Adviser:           STRAND HANSON LIMITED
 James Spinney, James Dance, Rob Patrick  +44 (0) 207 409 3494
 Broker:                                  HANNAM & PARTNERS
 Matt Hasson, Franck Nganou               +44 (0) 207 907 8500

 Public Relations:                        BLYTHERAY
 Megan Ray, Said Izagaren                 +44 (0) 207 138 3204

metalsexploration@blytheray.com

 

Web:                      www.metalsexploration.com
(http://www.metalsexploration.com)

Twitter:                  @MTLexploration
(https://twitter.com/MTLexploration)

LinkedIn:               Metals Exploration
(https://www.linkedin.com/company/metals-exploration-plc)

 

Competent Person's Statement

Mr Darren Bowden, a director of the Company, a Member of the Australasian
Institute of Mining and Metallurgy and who has been involved in the mining
industry for more than 25 years, has compiled, read and approved the technical
disclosure in relation to the Group's Philippine projects in this regulatory
announcement in accordance with the AIM Rules - Note for Mining and Oil &
Gas Companies.

 

Forward Looking Statements

Certain statements relating to the estimated or expected future production,
operating results, cash flows and costs and financial condition of Metals
Explorations, planned work at the Company's projects and the expected results
of such work contained herein are forward-looking statementswhich are based on
current expectations, estimates and projections about the potential returns of
the Group, industry and markets in which the Group operates in, the Directors'
beliefs and assumptions made by the Directors. Forward-looking statements are
statements that are not historical facts and are generally, but not always,
identified by words such as the following: "expects", "plans", "anticipates",
"forecasts", "believes", "intends", "estimates", "projects", "assumes",
"potential" or variations of such words and similar expressions.
Forward-looking statements also include reference to events or conditions that
will, would, may, could or should occur. Information concerning exploration
results and mineral reserve and resource estimates may also be deemed to be
forward-looking statements, as it constitutes a prediction of what might be
found to be present when and if a project is actually developed.

 

These statements are not guarantees of future performance or the ability to
identify and consummate investments and involve certain risks, uncertainties
and assumptions that are difficult to predict, qualify or quantify. Among the
factors that could cause actual results or projections to differ materially
include, without limitation: uncertainties related to raising sufficient
financing to fund the planned work in a timely manner and on acceptable terms;
changes in planned work resulting from logistical, technical or other factors;
the possibility that results of work will not fulfil projections/expectations
and realize the perceived potential of the Company's projects; uncertainties
involved in the interpretation of drilling results and other tests and the
estimation of gold reserves and resources; risk of accidents, equipment
breakdowns and labour disputes or other unanticipated difficulties or
interruptions; the possibility of environmental issues at the Company's
projects; the possibility of cost overruns or unanticipated expenses in work
programs; the need to obtain permits and comply with environmental laws and
regulations and other government requirements; fluctuations in the price of
gold and other risks and uncertainties.

 

The Company expressly disclaims any obligation or undertaking to disseminate
any updates or revisions to any forward looking statements contained herein to
reflect any change in the Group's expectations with regard thereto or any
change in events, conditions or circumstances on which any such statements are
based unless required to do so by applicable law or the AIM Rules.

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