REG - Mkango Resources Ltd - Mkango Releases Second Quarter 2024 Results

Mkango ResourcesAnnouncement

30/08/2024 07:00

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RNS Number : 2288C  Mkango Resources Limited  30 August 2024

 

 

 

 

MKANGO RESOURCES
LTD.

550 Burrard
Street

Suite
2900

Vancouver

BC V6C
0A3

Canada

 

30 August 2024

 

Mkango Releases Second Quarter 2024 Results

 

LONDON and VANCOUVER, British Columbia, 30 August 2024 - Mkango Resources Ltd
(AIM / TSX-V:MKA) (the "Company" or "Mkango") announces that it has released
the Financial Statements and Management's Discussion and Analysis for the
three month period ending 30 June 2024. The reports are available under the
Company's profile on the SEDARplus website
(https://www.sedarplus.ca/landingpage/ (https://www.sedarplus.ca/landingpage/)
) and on the Company's website (https://mkango.ca/investors/financials/
(https://mkango.ca/investors/financials/) ).

 

To view the Financial Statements, please click here:
http://www.rns-pdf.londonstockexchange.com/rns/2288C_1-2024-8-29.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/2288C_1-2024-8-29.pdf)

 

To view the Management Discussion and Analysis, please click
here: http://www.rns-pdf.londonstockexchange.com/rns/2288C_2-2024-8-29.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/2288C_2-2024-8-29.pdf)

 

RECENT FINANCINGS:

 

Subsequent to quarter end, the Company announced the following financings:

 

·    On 21 August 2024, the Company conditionally raised gross proceeds of
£1.25 million (approximately US$1.58 million) through the issuance, on a
private placement basis, of 25,000,000 Units of the Company at a price of
£0.05 per Unit (approximately US$0.063). A Unit consists of one common share
of the Company and one warrant. Each warrant will entitle the holder to
acquire one common share at a price of £0.07 (approximately US$0.089) per
common share for a period of three years following the closing of the
subscription which is expected to close on or about 5 September 2024. This
placing will allow the Company to acquire additional equipment for the 2025
commercial development of HyProMag's rare earth magnet recycling operations at
Tyseley Energy Park in Birmingham, UK and its recycling operation at
Pforzheim, Germany, in addition to increasing working capital.

·    On 21 August 2024, EIT RawMaterials provided funding of €200,000
(approximately US$214,111). This will fund the commencement of process
optimisation for the Songwe Hill Rare Earths Project in Malawi, a future
source of mixed rare earth carbonate feed for the Pulawy Project.

·    Following the £1.25m (US$1.58m) raised in August 2024 from existing
shareholders and the investment from EIT, Mkango remains well positioned to
cement its leading position and early mover advantage in rare earth magnet
recycling.

·    On 29 August 2024, it was announced that HyProMag GmbH ("HyproMag
Germany") is participating in the €8 million grant funded GREENE project, of
which HyProMag Germany will receive €350,125.

SECOND QUARTER HIGHLIGHTS:

 

·    During the second quarter, Mkango continued to advance its recycling
interests in the UK and Germany towards commercial production in 2025 via
HyProMag. In parallel, the Company progressed the on-going feasibility study
for HyProMag USA, LLC ("HyProMag USA"). It is reviewing strategic options for
the Songwe Hill Rare Earths Project and Pulawy Rare Earths Separation Project
in Malawi and Poland, respectively. Discussions are ongoing with potential
strategic investors, project finance providers, grant funding bodies and other
sources, to support recycling scale-up opportunities and further technology
roll-out.

·    During the period, Mkango Rare Earths UK ("Mkango UK") successfully
commissioned a pilot plant producing separated magnet rare earths
(neodymium/praseodymium and dysprosium/terbium carbonates or oxides) via a
long-loop recycling process.

·    A non-binding Memorandum of Understanding ("MoU") was signed between
HyProMag and Envipro Holdings Inc. ("Envipro") to launch a collaboration on
rare earth magnet recycling in Japan and the United Kingdom.

·    Mkango completed a fundraising of £750,000 (US$955,000) in April
2024, including a £150,000 (US$191,000) investment by Mkango CEO William
Dawes.

·    Additionally, the Company undertook a significant cost-cutting
exercise in the quarter, and focused its activities on the recycling business,
enabling a 35% reduction in ongoing operating cost requirements for the
business.

 

·    Loss after tax for the quarter ended 30 June 2024 was US$659,320
compared to US$1,085,092 for the quarter ended 30 June 2023.

 

OTHER SUBSEQUENT EVENTS:

 

·    On 15 July 2024, the findings of the mid-project review for the
Bankable Feasibility Study ("U.S. Feasibility Study") for HyProMag USA were
announced. Canada-based BBA USA Inc. ("BBA") and U.S.-based PegasusTSI Inc.
("PegasusTSI") have been engaged to complete the U.S. Feasibility Study, and
to engineer and design its REE magnet recycling plants and a production
facility in the United States. HyProMag USA has the potential to supply the
U.S. market with a sustainable, long term domestic supply of
neodymium/iron/boron (NdFeB) permanent magnets to enable the creation of
secure, low carbon and traceable rare-earth supply chains. With completion of
the U.S. Feasibility Study expected by the end of 2024, a positive production
decision in H1 2025 is expected to result in initial revenue from HyProMag USA
in H2 2026.

·    In late July 2024, Lancaster Exploration Limited, a British Virgin
Islands company and Lancaster Exploration Limited, a Malawi company ‒
both 100% owned subsidiaries of Mkango ‒ and the Government of Malawi
signed the  Mineral Development Agreement ("MDA") for the Songwe Hill Rare
Earths Project ("Songwe Hill") in Malawi. This is expected to enable further
value to be unlocked from the Songwe Hill and Pulawy rare earth separation
plant projects as part of the Company's ongoing evaluation of strategic
options for these assets. The Feasibility Study for Songwe Hill and
subsequent work identified a number of areas for potential cost optimisation,
and the Company continues to evaluate these and other cost reduction
opportunities in light of the currently weak rare earth market pricing
environment.

 

NEAR TERM CATALYSTS:

·    Completion of HyProMag
(https://www.linkedin.com/feed/hashtag/?keywords=hypromag&highlightedUpdateUrns=urn%3Ali%3Aactivity%3A7177998496057163776)
USA Feasibility Study is targeted by the end of 2024. The scope of operations
comprises a hub and spoke model, with three HPMS spokes and one magnet
manufacturing hub located in Texas. A production decision for HyProMag USA is
expected in H1 2025.

·    Full commissioning of the short-loop HPMS recycling plant in the UK
and initial commercial sales of NdFeB by HyProMag are targeted for Q1 2025.

·    HyproMag Germany first commercial production in Germany is targeted
for 2025.

 

INVESTOR WEBINAR:

 

The Company will host an Investor Webinar on Thursday 5(th) September at 5pm
UK time / 12pm Eastern Time. Please register and submit any questions via the
following link:

 

Webinar: Mkango Corporate Update September 2024 by Share Talk (bigmarker.com)
(https://www.bigmarker.com/share-talk/Mkango-Corporate-Update-September-2024)

 

About Mkango Resources Ltd.

Mkango is listed on the AIM and the TSX-V. Mkango's corporate strategy is to
become a market leader in the production of recycled rare earth magnets,
alloys and oxides, through its interest in Maginito Limited ("Maginito"),
which is owned 79.4 per cent by Mkango and 20.6 per cent by CoTec, and to
develop new sustainable sources of neodymium, praseodymium, dysprosium and
terbium to supply accelerating demand from electric vehicles, wind turbines
and other clean energy technologies.

Maginito holds a 100 per cent interest in HyProMag and a 90 per cent direct
and indirect interest (assuming conversion of Maginito's convertible loan) in
HyProMag Germany, focused on short loop rare earth magnet recycling in the UK
and Germany, respectively, and a 100 per cent interest in Mkango Rare Earths
UK Ltd ("Mkango UK"), focused on long loop rare earth magnet recycling in the
UK via a chemical route.

Maginito and CoTec are also rolling out HyProMag's recycling technology into
the United States via the 50/50 owned HyProMag USA.

Mkango also owns the advanced stage Songwe Hill rare earths project and an
extensive rare earths, uranium, tantalum, niobium, rutile, nickel and cobalt
exploration portfolio in Malawi, and the Pulawy rare earths separation project
in Poland.

For more information, please visit www.mkango.ca (http://www.mkango.ca)

Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking statements (within the meaning of
that term under applicable securities laws) with respect to Mkango. Generally,
forward looking statements can be identified by the use of words such as
"targeted", "plans", "expects" or "is expected to", "scheduled", "estimates"
"intends", "anticipates", "believes", or variations of such words and phrases,
or statements that certain actions, events or results "can", "may", "could",
"would", "should", "might" or "will", occur or be achieved, or the negative
connotations thereof. Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the plans,
intentions or expectations upon which they are based will occur. By their
nature, forward-looking statements involve numerous assumptions, known and
unknown risks and uncertainties, both general and specific, that contribute to
the possibility that the predictions, forecasts, projections and other
forward-looking statements will not occur, which may cause actual performance
and results in future periods to differ materially from any estimates or
projections of future performance or results expressed or implied by such
forward-looking statements. Such factors and risks include, without limiting
the foregoing, receipt of TSX-V approval for the Subscription, the
availability of (or delays in obtaining) financing to develop Songwe Hill, and
the various recycling plants in the UK, Germany and the US as well as the
separation plant in Poland, governmental action and other market effects on
global demand and pricing for the metals and associated downstream products
for which Mkango is exploring, researching and developing, geological,
technical and regulatory matters relating to the development of Songwe Hill,
the ability to scale the HPMS and chemical recycling technologies to
commercial scale, competitors having greater financial capability and
effective competing technologies in the recycling and separation business of
Maginito and Mkango, availability of scrap supplies for recycling activities,
government regulation (including the impact of environmental and other
regulations) on and the economics in relation to recycling and the development
of the various recycling and separation plants of Mkango and Maginito and
future investments in the United States pursuant to the cooperation agreement
between Maginito and CoTec, the outcome and timing of the completion of the
feasibility studies, cost overruns, complexities in building and operating the
plants, and the positive results of feasibility studies on the various
proposed aspects of Mkango's, Maginito's and CoTec's activities. The
forward-looking statements contained in this news release are made as of the
date of this news release. Except as required by law, the Company disclaims
any intention and assume no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except as required by applicable law. Additionally, the Company
undertakes no obligation to comment on the expectations of, or statements made
by, third parties in respect of the matters discussed above.

For further information on Mkango, please contact:

Mkango Resources Limited

 

William
Dawes
Alexander Lemon

Chief Executive Officer                  President

will@mkango.ca
alex@mkango.ca

Canada: +1 403 444 5979

www.mkango.ca (http://www.mkango.ca)

@MkangoResources

 

SP Angel Corporate Finance LLP

Nominated Adviser and Joint Broker

Jeff Keating, Caroline Rowe

UK: +44 20 3470 0470

 

Alternative Resource Capital

Joint Broker

Alex Wood, Keith Dowsing

UK: +44 20 7186 9004/5

 

The TSX Venture Exchange has neither approved nor disapproved the contents of
this press release. Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this release.

This press release does not constitute an offer to sell or a solicitation of
an offer to buy any equity or other securities of the Company in the United
States. The securities of the Company will not be registered under the United
States Securities Act of 1933, as amended (the "U.S. Securities Act") and may
not be offered or sold within the United States to, or for the account or
benefit of, U.S. persons except in certain transactions exempt from the
registration requirements of the U.S. Securities Act.

 

 

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