REG - Ormonde Mining PLC - Final Results

Ormonde MiningAnnouncement

26/05/2021 07:05

RNS Number : 8005Z
  
Ormonde Mining PLC
  
26 May 2021
  
 

26 May 2021
 
 
Ormonde Mining plc
("Ormonde" or "the Company")
 
Chair's Review and Final Results for the Year ended 31 December 2020
 
Chair's Review
 
The 2020 year started with the sale of Ormonde's 30% interest in the Barruecopardo Tungsten Mine ("Barruecopardo") in Spain, and the receipt of €6 million from Oaktree Capital Management ("Oaktree") ahead of the world going into lockdown due to the COVID-19 pandemic.  Since that time, the Company has focused its efforts on the development of new opportunities for the deployment of its capital and enhancement of shareholder value, while continuing to review the best route to generate value from its remaining Spanish assets.
 
Disposal and receipt of €6 million cash consideration
The disposal of the Company's interest in Barruecopardo was strategically and financially important for Ormonde and agreed with Oaktree in January 2020. Following approval of the sale by Ormonde shareholders at an extraordinary general meeting in February 2020, Ormonde received a net cash consideration of €6 million.  Given how the remainder of 2020 unfolded, the Barruecopardo sale certainly proved to be the right decision and in the best interests of all shareholders.
 
Board & Management restructuring
On completion of the disposal, Mike Donoghue and John Carroll, who had provided the Company with many years of dedicated service, retired from the Board and Tim Livesey and Richard Brown were subsequently appointed.  John has since sadly passed away and I take this opportunity to pay my deepest sympathies to his family.  
 
Also following the disposal, I moved to the position of Executive Chair with a view to driving Ormonde towards a new and exciting future. This ambition is shared across the executive management team and the new Board and led to the pursuit of a number of transactions over the course of the year.
 
New opportunities
The Board and Management have been focused on identifying and assessing potential investment opportunities in the resource sector for more than a year.  Over the course of 2020 and the first quarter of 2021, we have reviewed over one hundred and thirty new business opportunities, including several in considerable detail through technical, commercial and legal due diligence.
 
In September 2020, the Company announced that it had entered into an exclusivity agreement in relation to a potential transaction to acquire, or have the rights to acquire, up to an 80% interest in two exploitation licenses covering multiple high-grade copper and polymetallic development and exploration projects in a highly prospective and underexplored district in the Republic of the Congo.  However, a lack of support for Resolution 6 at the Company's 2020 AGM held in late 2020 and subsequently adjourned to early 2021 means that Ormonde is no longer authorised to issue shares for a transaction of this nature without a further shareholder approval process. The resulting inability to offer the milestone-based mix of cash and Ormonde shares as consideration for the acquisition introduced an increased level of uncertainty, delay and execution risk for the counterparties.   Ultimately the counterparties demanded more onerous terms for the transaction, which significantly impacted the accretive potential of the transaction for all Ormonde shareholders, and as a result all discussions were terminated in April 2021. 
 
This was an unfortunate set of circumstances which led to the Company and its shareholders missing out on what the Board believed would have been a transformational and value enhancing deal. The Board is now exploring alternative opportunities and strategies for the business in the interest of all shareholders in a landscape which has changed markedly in recent months in terms of the increased capital now available to junior mining companies, somewhat limiting Ormonde's competitive advantage.
 
 
Current projects
Ormonde continues to retain its exploration and development assets in Spain, namely the Salamanca and Zamora Gold Projects and assets relating to the La Zarza Copper-Gold Project. While we continue to seek ways to maximise value for shareholders from these assets, including the sale of the La Zarza interests, material expenditure is not anticipated to be incurred on them until a decision has been made in respect of new opportunities.  The ability to maximise value for shareholders from these assets has been impacted by the pandemic but we continue to have ongoing dialogue with prospective interested parties.  
 
Financials
Ormonde has reported a profit after tax for 2020 of €0.5 million, compared with a loss of €11.3 million for 2019. The reported profit for 2020 includes a gain of €1.6 million related to accounting for the completion of the Barruecopardo disposal in February 2020, whereas the 2019 loss reflected an impairment of €10.4 million related to the same asset.
 
Finally, I would like to thank all our stakeholders, management, employees, directors and advisors for their continued support and hard work over what has been a very difficult and challenging period for all involved.  I wish you all well as we emerge from a long period of isolation and readjust to the new world in front of us.
 
 
 
 
 
Jonathan Henry
Executive Chair
 
 
Enquiries to:
 
Ormonde Mining plc
Jonathan Henry, Executive Chair
Paul Carroll, Chief Financial Officer
Fraser Gardiner, Chief Operating Officer
Tel: +353 (0)1 8014184
 
Buchanan
Bobby Morse / Ariadna Peretz / James Husband
Tel: +44 (0)20 7466 5000
Email: ormonde@buchanan.uk.com 
 
Davy (Nomad, Euronext Growth Advisor and Joint Broker) 
John Frain / Barry Murphy
Tel: +353 (0)1 679 6363
 
SP Angel Corporate Finance LLP (Joint Broker)
Ewan Leggat
Tel: +44 (0)20 3 470 0470
 




 
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020
 
 







Year ended


Year ended








31-Dec-20


31-Dec-19








€000s


€000s
































Turnover


-


-


















Administration expenses


(1,119)


(855)




Impairment of intangibles


-


(49)








______


______




Loss on ordinary activities 


(1,119)


(904)


















Finance costs


(17)


-








______


______




Loss for the year from continuing activities


(1,136)


(904)


















Tax expense


-


-








______


______




Loss for the year after tax


(1,136)


(904)


















Profit / (loss) from discontinued operations


1,600


(10,399)








______


______




Profit / (loss) for the year


464


(11,303)


















Other comprehensive income












Foreign exchange relating to discontinued operations


-


332


















Less: Reclassification of foreign currency gain on disposal of foreign operation


(1,600)


-








______


______




Total comprehensive loss for the year


(1,136)


(10,971)
































Earnings per share












from continuing operations












Basic & diluted loss per share (in cent)


(0.24)


(0.19)




Total earnings per share












Basic & diluted earnings / (loss) per share (in cent)


0.10


(2.39)



 
 




 
Consolidated Statement of Financial Position
as at 31 December 2020
 
 







31-Dec-20


31-Dec-19








€000s


€000s




Assets


























Non-current assets












Intangible assets


295


285








_______


_______




Total Non-Current Assets


295


285


















Current assets












Trade and other receivables


59


379




Asset classified as held for sale


2,400


8,400




Cash & cash equivalents


4,965


130








_______


_______




Total Current Assets


7,423


8,909








_______


_______




Total Assets


7,718


9,194








_______


_______


















Equity & liabilities


























Capital and Reserves












Issued capital


4,725


13,485




Share premium account


29,932


29,932




Share based payment reserve


283


837




Capital conversion reserve fund


29


29




Capital redemption reserve fund


7


7




Foreign currency translation reserve


-


1,600




Retained losses


(27,469)


(37,265)








_______


_______




Total Equity - attributable to the owners of the Company


7,507


8,625


















Current Liabilities












Trade & other payables


211


569








_______


_______




Total Liabilities


211


569








_______


_______




Total Equity & Liabilities


7,718


9,194








_______


_______







 
Consolidated Statement of Cashflows
for the year ended 31 December 2020
 







Year ended


Year ended








31-Dec-20


31-Dec-19








€000s


€000s


















Cashflows from operating activities












Profit / (loss) for the year before taxation


























Continuing operations


(1,136)


(904)




Discontinued operations


1,600


(10,399)








________


________








464


(11,303)




Adjustments for:












Impairment of intangible assets


-


49




Impairment of investment in associate


-


7,787




Share of loss in associate


-


3,263




Reclassification of foreign exchange gain


(1,600)


-




Non cash items: Share option cost


19


-








________


________








(1,117)


(204)




Movement in Working Capital












Movement in receivables


320


(337)




Movement in liabilities


(358)


282








________


________




Net cash used in operations


(1,155)


(259)


















Investing activities












Expenditure on intangible assets


(10)


(10)




Proceeds from disposal of associate


6,000


-








________


________




Net cash generated by / (used in) investing activities


5,990


(10)


















Net increase / (decrease) in cash and cash equivalents


4,835


(269)


















Cash and cash equivalents at the beginning of the year


130


399








______


______




Cash and cash equivalents at the end of the year


4,965


130



 
 




 
Consolidated Statement of Changes in Equity
for the year ended 31 December 2020
 











Share based




















Share


Share


Payment


Other


Retained












Capital


Premium


Reserve


Reserves


Losses


Total








€000s


€000s


€000s


€000s


€000s


€000s


































Balance at 1 January 2019


13,485


29,932


837


1,304


(25,962)


19,596


































Loss for the year


-


-


-


-


(11,303)


(11,303)




Foreign exchange on associate


-


-


-


332


-


332








______


______


______


______


______


______




Total comprehensive income for year


-


-


-


332


(11,303)


(10,971)








______


______


______


______


______


______




Balance at 31 December 2019


13,485


29,932


837


1,636


(37,265)


8,625


































Loss for the year


-


-


-


-


(1,136)


(1,136)




Reclassification of foreign currency gain on disposal of foreign operation


-


-


-


(1,600)


1,600


-








______


______


______


______


______


______




Total comprehensive income for year


-


-


-


(1,600)


464


(1,136)


































Release relating to expired share options


-


-


(572)


-


572


-




Employee share-based compensation


-


-


18


-


-


18




Cancellation of deferred shares


(8,760)


-


-


-


8,760


-








______


______


______


______


______


______




Balance at 31 December 2020


4,725


29,932


283


36


(27,469)


7,508








______


______


______


______


______


______



 
 
 
 
1.   The basic loss per share has been calculated on a profit after taxation of €463,542 (2019: loss of €11,303,495) and a weighted average number of Ordinary Shares in issue for the year of 472,507,482 (2019: 472,507,482). Due to the Group's loss for the year ended 31 December 2019, the share options are anti-dilutive and therefore diluted earnings per share are the same as basic earnings per share. For the year ended 31 December 2020 the basic and diluted earnings per share are the same.
 
2.   The financial information prepared using accounting policies consistent with International Financial Reporting Standards ("IFRS") as adopted by the European Union included in this preliminary statement does not constitute the statutory financial statements for the purposes of Chapter 4 of part 6 of the Companies Act 2014.  Full statutory statements for the year ended 31 December 2020 prepared in accordance with IFRS, upon which the auditors have given an unqualified report, have not yet been filed with the Registrar of Companies.  Although their report was unqualified, the auditors drew attention to the disclosures made in the statutory financial statements relating to the carrying value of the La Zarza exploration and evaluation assets classed as held for sale. Full financial statements for the year ended 31 December 2019 prepared in accordance with IFRS and containing an unqualified report, have been filed with the Registrar of Companies.
 
3.   A cancellation of deferred shares was completed during the year in preparation for the migration of certain of the Company's shares to the central securities depository of Euroclear Bank.  There was no consideration paid by the Company in relation to this cancellation.
 

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