REG - Scotgold Resources - Final Results
21/12/2022 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:20221221:nRSU3946Ka&default-theme=true
RNS Number : 3946K Scotgold Resources Ltd 21 December 2022
Scotgold Resources Limited ("Scotgold" or the "Company")
Final Results
Scotgold Resources Limited (AIM: SGZ), is pleased to announce its Annual
Results for year ended 30 June 2022.
Operational Overview
· Significant progress made at Cononish Gold and Silver Mine
("Cononish" or the "Project") in Scotland as the Company targets production of
c.23,500oz p.a. run rate of gold in 2023
· Continued optimisation initiatives across underground mining and
processing to enhance efficiencies, increase mining rates, gold recovery and
production
· Achieved Phase 1 production (3,000tpcm/9,000 ounces of gold p.a.
run rate) in Q1 2022
· Attained optimised production rate at end October 2022
(4,000tpcm/16,000 ounces of gold p.a. run rate)
· Commenced very low frequency magnetics to determine a 2023
resource drilling campaign to increase Cononish life of mine
· Hold 13 licences, covering 2,900km of the Dalradian Belt across
the Grampian Mountain range for future exploration
· 96 employees at 30 November 2022 (31 December 2021: 73) with
ambitious growth plans to continue to increase headcount during 2023
· Vision to build a multi-asset gold production company in Scotland
Financials
· Total revenues of A$17.8 million in 2022 (2021: A$300k)
· Loss before taxation in 2022 of A$10.8 million (2021: A$5
million)
· Cash at 30 June 2022 of A$168k (2021: A$2.6 million)
· Commercial production achieved 30 June 2022 after three
consecutive months of positive operating cashflow
· Net debt of A$23.4 million at 30 June 2022
Scotgold Resources CEO, Phil Day said, "It has been a year of transformative
progress as we continue to ramp up production at our Cononish gold mine in
Scotland towards Phase 2 mining, to achieve a yearly run rate of +23,500
ounces of gold in 2023. We were delighted to achieve Phase 1 mining in Q1 2022
and subsequently to announce the significant milestone of commercial
production on 30 June 2022, after three consecutive months of positive
operating cashflow, and continue to operate as a cash generative mining
operation with buoyant gold concentrate sales.
"When developing an underground mine to achieve full production, there are
sometimes short-term variations in ounces produced. This is normal and
expected in underground mine development as development work continues in
parallel with definition drilling to allow long hole retreat stope mining to
commence. Once long-hole stoping is achieved, minimal dilution and increased
ore recovery will be realised (and in parallel with all other optimisation
initiatives implemented during 2021 and 2022 across the underground mine and
processing plant), provide continuity of ore mined/ounces produced on a week
by week/month by month basis.
"As I write this, 2023 is shaping up to be an exciting year for us in terms of
mine development and gold production and I look forward to reporting on
progress through out.
"As ever, none of this progress would be possible without our talented and
committed team here in Tyndrum. We have grown ambitiously, increasing our
workforce 156% since I joined in April 2021, to 96 people, of which 51 are
from Scotland. In line with our vision to build a multi-asset gold production
company, we will continue to increase our headcount during 2023 and beyond,
through apprenticeships, internships, and student bursaries such as ours with
the University of St Andrews, to become the employer of choice in the region.
"Cononish is an exceptionally high-grade gold underground mining operation
with a reserve grade of c.11.9g/t Au and has a current life of mine of 8.5
years with an estimated 555,000 tonnes of ore. Notably, even without any
further resource exploration and expansion, Cononish's in-situ value is
estimated to be £288 million, at current gold prices of £1,456 per ounce and
projected All in Sustaining cost ("AISC") of £554 per ounce, will place
Scotgold as one of the highest yielding - lowest cost gold producers globally
once in full production in 2023.
"Whilst we anticipate significant cash generation, especially once full
production is achieved during 2023, we are committed to continuing to grow and
realise Cononish and Scotgold's value through exploration. Our
resource/reserve and life of mine has the potential to be substantially
increased within the immediate Cononish mining area, and to this end we have
completed very low frequency magnetics to determine a 2023 exploration
programme to do this.
"Looking ahead to 2023, I remain hugely excited and look forward to keeping
stakeholders updated on our developments as we continue to build an
intergenerational mining company for the future."
CEO & MD
Phil Day
16 December 2022
Chairman Statement
I am delighted to report on the progress we have made during the past year, as
Scotland's and the UK's first commercial gold producer.
We have a growth strategy focused on delivering long-term sustainable growth
and returns for all stakeholders with a vision to build a multi-asset gold
production company in Scotland. This strategy is centred on three core pillars
- optimising value at our Cononish Gold Mine in Tyndrum, Scotland; growth
through resource expansion and regional exploration; and investment in our
people and commitment to sustainability.
Figure 1: Scotgold's Strategy
During the past year we have been maximising value at Cononish through
continued optimisation initiatives across our operation both in our
underground mining operations and processing plant to enhance efficiencies,
increase mining rates, gold recovery and production.
The second calendar half of 2021 saw our new team, led by our CEO & MD,
Phil Day who joined the Company in April 2021, implement a re-design of the
mine schedule to allow faster access to the higher-grade zones within
Cononish's orebody. This was to fast-track Phase 1 ramp up towards 3,000t pcm
processing rates (9,000 ounces of gold run rate per annum of gold). Like many
mining firms around the world, we endured significant Covid-19 disruptions,
with people infected or isolating repeatedly, along with significant
challenges with our extensive supply chains during this period. However,
with thanks to our committed team in Scotland who worked tirelessly during
that challenging time, we were delighted to report that we achieved Phase 1
production in Q1 2022.
During Q2 2022 the new enterprise resource system and mining mobile equipment
fleet were implemented. It was in this quarter where we recorded our first
record gold sales and production of £5.0 million and 3,531 ounces of gold,
respectively. Further optimisation initiatives were conducted in Q3 2022
which saw ventilation and power upgrades to the underground mining operation
and de-bottlenecking of the process plant (flotation and tailings filtration).
These optimisation initiatives saw Cononish's processing rate achieve
4,000tpcm in October in Q3 2022.
The tailings thickener is now installed, and final works are now being
implemented over the Christmas period. Once fully commissioned it should see
our processing rate increase to 5,000tpcm, equating to a gold production run
rate of 20,000 ounces per annum. Underground resource definition and grade
control drilling also commenced in Q4 2022 which will significantly increase
the resolution of our orebody and make mine planning more efficient and
effective.
In tandem with the underground mine work, final plant optimisation works,
including adding further filtration plates and to complete further
optimisation around the tailings filter and ball mill will be completed. Once
complete, we expect to achieve Phase 2 production with a processing rate of
6,000tpcm (72,000t annually), equating to a gold run rate of +23,500 ounces in
2023.
Once in Phase 2, our AISC at Cononish is anticipated to be £544 per ounce,
and with the mine running an average grade through the processing plant of
c.12g/t Au year to date, will place us as one of the highest margin, lowest
cost gold producers globally.
Figure 2: 2022 - 2023 Mine Optimisation and Growth
Our second pillar central to our strategy is 'growth through resource
expansion and regional exploration'. Whilst the past year has predominantly
been focused on optimising value at Cononish to achieve Phase 2/full
production in 2023, exploration is pivotal to unlocking value and building a
multi-asset gold company in Scotland and an intergenerational mining company
of the future.
As already noted, Cononish is an exceptionally high-grade gold underground
mining operation. We believe the current Cononish resource can be
significantly increased, with corresponding increase of the current 8.5 years
life of mine, through exploration drilling. There are several areas within the
Cononish resource (near mine expansion targets) that are capable of hosting
mineable high-grade pods. We plan to explore these areas with drilling to
increase the resource in addition to investigating the extension of the
resource along down dip and strike. As these areas are part of the current
resource vein, we believe they may be more readily available to convert
to reserves. During Q3 2022 we began very low frequency resolution magnetics
to determine a 2023 resource drilling campaign and look forward to updating
shareholders on this in due course.
In addition to expanding the Cononish resource and increasing the life of mine
in the near-term we have an impressive land package for regional exploration
in the future. We hold 13 licences, covering 2,900 square km of the Dalradian
Belt across the Grampian Mountain range. The geology points to further
exceptionally high-grade deposits, like Cononish and it is part of our
longer-term strategy to explore these areas with the vision to develop
additional gold mines in Scotland.
Finally, our third pillar central to our growth strategy is our 'investment in
people and commitment to sustainability'.
We are supported and driven by our exceptional people. We currently have 96
employees in our team with ambitious growth plans to continue to increase our
headcount during 2023. We are led by an experienced executive leadership team
with a proven track record that will help us to deliver on our vision and
in-turn generate value for all stakeholders.
We are investing in our people, to not only help build Scotgold, but also that
of the Scottish and UK mining industry. We want to be the employer of choice
in the region, helping to drive local and Scottish employment. In this regard,
I am delighted to report that we have been working with Fourth Valley College
in Falkirk on apprenticeship schemes where we currently have placed students
in mechanical engineering roles. In addition, in July 2022, we launched a
partnership with the University of St Andrews for a five-year student bursary
programme. Our team is working closely with the University teaching staff and
students on the MSc Strategic Resources course involving work at both the
University and at our Cononish site.
We are committed to the principles of sustainable and responsible mining in
all aspects of our business. Operating in Scotland's first national park, we
have an important duty of care to the environment, and we are dedicated to the
safety of our workforce and local communities. To that end, we are proud of
our no cyanide status, as one of the only gold producers globally that does
not use it in our processing. We also utilise dry stack tailings to ensure
safety and a minimal environmental footprint. Dry stack tailings are much more
environmentally friendly and safer than conventional wet tailings that sadly
have seen terrible mismanagement and accidents over the years at mine sites
globally. Dry stack tailings completely dry the tailings into sand like
material before placing into gullies. This allows the Company to fill the
gullies to match the natural landscape. In line with our commitment to reduce
CO2 emissions we are also reviewing the use of hydro power at site and will
update the market accordingly on this initiative.
We also support work of Loch Lomond and The Trossachs National Park and
contribute to the Strathfillan Development Trust, which is a local charity
representing the residents of Tyndrum, Crianlarich and Inverarnan. In terms of
financials, we are now a cash generative gold mining company, where we expect
to see further significant growth in terms of cash generation as we enter
Phase 2 production in 2023. Notably we achieved commercial production (three
consecutive months of positive operating cashflow) at the end of June 2022.
Total revenues for the year was $17.8 million and whilst we reported a
widening of losses for 2022 of $10.8 million, with Cononish now cash
generative and operating profitably we expect to see significant cash
generation in 2023 and a move towards profitability.
Finally, I would like to extend my appreciation to the team here in Scotland
who have worked with dedication during the past year to deliver on Cononish's
production ramp up. I would also like to extend my gratitude to my fellow
board members, leadership team, advisors, and importantly shareholders for
their continued support.
2023 is shaping up to be an extremely exciting year as Cononish reaches full
ramp up/Phase 2 mining of +23,500 ounces of gold run rate per annum.
Furthermore, as we begin to explore the resource/reserve expansion potential
of Cononish to increase its life of mine and our regional licence areas, we
will continue to open Scotland as a new gold mining province and ultimately
develop future mining operations in Scotland.
Chairman
Peter Hetherington
20 December 2022
A full version of Scotgold's final results for year ended 30 June 2022 is
available via the Company's website or see the following
link. http://www.rns-pdf.londonstockexchange.com/rns/3946K_1-2022-12-20.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/3946K_1-2022-12-20.pdf)
For further information please visit www.scotgoldresources.com
(http://www.scotgoldresources.com) or contact the following:
Scotgold Resources Limited Shore Capital Celicourt Communications
Chief Executive Officer Nomad and Broker Financial PR
Phil Day Toby Gibbs / John More Felicity Winkles
Tel +44 (0) 20 7408 4090 Tel +44 (0) 208 434 2643
Tel +44 (0) 774 8843 871
OPERATIONS REVIEW
Background
Scotgold Resources Limited ("the Company") was established in 2007 and has
been listed on the AIM market of the London Stock Exchange (AIM:SGZ).
The Company's principal objectives have continued to be:
a) the development and operation of the Cononish Gold and Silver Mine in
Scotland's Grampian Highlands; and
b) the ongoing exploration of the highly prospective tenements comprising the
Grampian Gold Project with the view to identifying further project
opportunities.
CORPORATE SOCIAL RESPONSIBILITY ("CSR")
The Company recognises its responsibilities to the Community, the Environment,
its Employees and the Workplace with respect to sustainable development,
safety and community development. The CSR Committee, which held its
inaugural meeting on 10(th) May 2019, continued throughout the year to pursue
its purpose of reviewing and monitoring relevant policies, programmes and
activities of the Scotgold Resources Group on behalf of the Board of Directors
of the Company to ensure these responsibilities are met.
In doing so, it continued to focus on the three broad areas of:
· Health, Safety and Welfare of the Community, Employees,
Consultants and Visitors;
· Stewardship of the Environment; and
· Corporate Citizenship and Societal Interaction
These areas are presented on the Scotgold website alongside details of how
complaints will be handled.
The CSR Committee continues to oversee the carrying out of regular assessments
of the risks posed by Covid-19 and the adjustment of the aforementioned
operating procedures in response thereto.
CONONISH GOLD AND SILVER PROJECT
Gold production commenced in November 2020.
The Company has continued to ramp up production during the period, after
achieving its second shipment of gold concentrate during July 2021. The
Company achieved commercial production on 30 June 2022.
Phase 2/Expansion Phase is targeted for 2023 where the Company anticipate
achieving 23,500 ounces p.a. run rate of gold.
Low-capex optimisation initiatives, including the addition of a thickener into
the tailings circuit, are underway. Commissioning is set for c.Q4 2022 and
will further increase ore throughput and gold recoveries. With debottlenecking
of the flotation plant working at a rate of c.4,000 tonnes of feed per month,
the Company expects to see the commissioning of the tailings thickener to
increase throughput to 5,000 tonnes per month.
The Group reached commercial production on 30 June 2022 by achieving three
consecutive months of positive operating cash flows.
GRAMPIAN GOLD PROJECT
On 29 January 2021, the Company announced that recent exploration work
undertaken across the Company's option areas over the Dalradian Belt had
resulted in:
· The identification of additional targets and provided persuasive
evidence for the presence of mineralised veins structures; and
· Three prospective areas, close to Cononish Mine, being identified
as high priority target areas and data modelling is in progress to establish
the best sites to test these targets in any potential future exploration drill
programmes.
CORPORATE ACTIVITIES
The Group, through its subsidiary SGZ Cononish Ltd, settled the short-term
funding provided by the Directors by issuing 3,301,420 of new ordinary shares
of no par value at a price of 60.58p and a fair value of 82.5p in September
2021.
On 3 November 2021 Mr Peter Hetherington became Non-Executive Chairman having
been Non- Executive Director previously. On the same day Mr Nathaniel le Roux
became Non-Executive Director stepping down from his role as Non-Executive
Chairman.
On 14 January 2022, the Group negotiated a debt restructure with Bridge Barn
Limited, a company owned and controlled by Mr Nathaniel le Roux (Non-Executive
Director), which had provided the existing loan facility of £7.5 million (the
"Existing Loan Facility"). The restructured loan provided £5.0 million to
replace the original loan tranches and interest due and provided a cash
injection to the business of £131,562. The restructured £5 million loan has
a term of 3 years to 1 Jan 2025 at the same terms and rate as the previous
loan of 9%. The terms of the Existing Loan Facility for the remaining original
tranches £3.5 million principal (plus interest) will remain. The other
tranches of the Existing Loan Facility are repayable on various dates from 7
March 2023 to 17 March 2024. Principal amounts of the Loans owing to Bridge
Barn now stand at £8.5 million.
Also on 14 January 2022, Jane Styslinger, a related party of William
Styslinger (non-executive director of Scotgold), provided an additional loan
of £500,000 at an interest rate of 9%, payable in three years from the date
of drawdown.
On 3 March 2022, the Group entered into a short term loan facility with Bridge
Barn Limited, a company owned and controlled by Nathaniel le Roux
(Non-Executive Director) providing £250,000 to Scotgold. This was repaid in
full on 23 May 2022.
On 16 March 2022, the Company appointed Sean Duffy as Chief Financial Officer
and Evan Spencer as an Independent Non-Executive Director and Chairman of the
Technical Committee, to the Board of Directors.
Mr Richard Gray and Mr Phillip Jackson both resigned as Non-Executive
Directors on 16 March 2022.
On 7 April 2022, the Group, entered into a loan procurement agreement with
Fern Wealth GmbH ("Fern Wealth") from a syndicate of high-net-worth investors
for an amount up to £3.0 million. At 30 June 2022, £2.1 million of this loan
had been drawn down.
CONONISH MINERAL RESOURCES
The Mineral Resource Estimate ("MRE") is classified as Measured, Indicated and
Inferred Mineral Resources, (adhering to guidelines set out in the JORC Code
(2012 Edition)), and is reported at a cut-off grade of 3.5 g/t gold as is
presented in the Table below. The Table also serves as the Company's Annual
Mineral Resource Statement.
Table: 2022 Annual Mineral Resource Statement
Cononish Main Vein Gold and Silver Mineral Resources, estimated in accordance
with the JORC code (2012 Edition) and reported at a 3.5 g/t Au cut-off as at
12/01/2015, which remain current subject to the depletion of approximately
6.5kt from the Indicated Resources - Mined Stockpile. Mine development during
the reporting period has predominantly been in waste, with a non-material
volume of Mineral Resource placed on surface stockpiles.
Note: Mineral Resources presented above include Ore Reserves stated below.
Approximately 1.6Kt was processed during commissioning during the reporting
period and is not a material effect on the Mineral Resources as reported
previously.
An internal review of the MRE concluded that the estimation techniques and
parameters employed remained appropriate.
The Cononish mineralisation remains open at depth down plunge and to the west
along strike. There is therefore potential to add to the resource by further
extensional drilling.
In addition to the currently defined Mineral Resources, Scotgold believes that
there is additional resource development potential close to Cononish, subject
to appropriate and successful further work. Extensive gold-in-soil anomalies,
mineralisation associated with outcrops and trenches, and geophysical
anomalies close to the current resource clearly warrant further follow up. In
addition, there are indications that other reefs are present in the area. At
this stage, such indications are highly conceptual and there is no guarantee
that further exploration will define additional Mineral Resources.
In 2022 an internal grade control model has been developed using underground
channel samples, adit mapping and historical drillholes and enables greater
confidence in the vein location and ore grades. This model is used for monthly
forecasting and does not change the MRE.
The MRE will be updated in Q1 2023, however for now it has not been depleted
and remains unchanged.
CONONISH ORE RESERVES
As part of initial work towards developing the 2015 BFS, Bara Consulting
Limited completed a thorough review of the 2013 Cononish Development plan in
order to identify opportunities to not only improve on the plan but to also
improve the confidence in the plan. As a result of this review, further work
was undertaken on the mining methodology, access design, geotechnical
evaluation and overall mine design.
The outcome of this work was that an Ore Reserve Estimate was completed on 25
May 2015, in accordance with the JORC code (2012 Edition) based on the MRE
issued in January 2015. The subsequent addendum to the Bankable Feasibility
Study resulted in no change to the Ore Reserve. Hence there is no change to
the Ore Reserves reported previously for the Project as at 30/06/2021. Mine
development during the reporting period from 2020 to 2022 has been in waste
and ore.
An internal review of the Ore Reserve Statement concluded that the modifying
factors used in determining the Ore Reserve remained appropriate.
Table: 2021 Annual Ore Reserve Statement
As at 25 May 2015 (JORC 2012 Code)
Classification Proven Probable Total
Tonnes ('000) 65 490 555
Au Grade (g/t) 11.5 11.1 11.1
Au Metal (k oz) 24 174 198
Ag Grade (g/t) 51.5 47.2 47.7
Ag Metal (k oz) 108 743 851
(Bara Consulting Limited Ore Reserve Statement dated May 2015)
For greater detail on the parameters derived from this work and used for the
Ore Reserve estimation process, please refer to the Company's announcement on
26/05/2015 - Cononish Gold Project Study Update and Reserve Estimate; and to
the subsequent announcement on 16/03/2017 - Update to Cononish Bankable
feasibility study on the Company's website.
Since 2019, the Company has been steadily ramping up production. In 2022 the
focus has been on the commencement of stoping and the necessary development
and infrastructure for this to occur.
The Ore Reserve statement above does not take account of the depletion of the
underground development from 2019 to 2022 or the surface stockpile. This will
be adjusted in 2023 as part of a larger Mineral Resource and Reserve update.
As of 31 July 2022, approximately 32.6kt of ore and 35.4kt of waste have been
mined since 2019.
Both the MRE and Ore Reserve statement were compiled by suitably qualified
Independent Competent Persons as identified at the time of their release.
GRAMPIAN GOLD PROJECT
The Company continues to actively pursue exploration activities on its
substantial land position (approx. 2,900 km2) in the Dalradian Belt of the
southwest Grampians, a terrain highly prospective for both precious and base
metal occurrences. The majority (85%) of the area currently under option to
Scotgold is located outside the Loch Lomond and the Trossachs National Park.
Very low frequency (VLF) geophysics exploration took place in September 2022
in the Cononish Glen. VLF can define high conductivity structures at depth,
often indicative of the presence of metals, and will be used to define future
exploration drilling targets.
TENEMENT DETAILS
United Kingdom
The Company holds a lease (100%) from the Crown Estate Scotland over Cononish
Farm, county of Perth, Scotland UK. The Company holds a lease (100%) from the
landowner over Cononish Farm, county of Perth, Scotland UK.
The Company holds thirteen Mines Royal Option Agreements (100%) with the Crown
Estate Scotland as detailed below:
No. Name Area Location
1 Knapdale South 250 km(2) county of Argyll, Scotland UK
2 Knapdale North 250 km(2) county of Argyll, Scotland UK
3 Inverliever West 250 km(2) counties of Dunbarton, Argyll and Perth, Scotland UK
4 Inverliever East 233 km(2) counties of Dunbarton, Argyll and Perth, Scotland UK
5 Glen Orchy West 103 km(2) counties of Perth and Argyll, Scotland UK
6 Glen Orchy Central 242 km(2) counties of Perth and Argyll, Scotland UK
7 Glen Orchy East 241 km(2) counties of Perth and Argyll, Scotland UK
8 Glen Lyon West 246 km(2) counties of Perth and Argyll, Scotland UK
9 Glen Lyon North 244 km(2) counties of Perth and Argyll, Scotland UK
10 Glen Lyon South 243 km(2) counties of Perth and Argyll, Scotland UK
11 Glen Lyon East 247 km(2) counties of Perth and Argyll, Scotland UK
12 Ochills West 189 km(2) county of Clackmannan, Perth, Kinross and Stirling, Scotland UK
13 Ochills East 150 km(2) county of Clackmannan, Perth, Kinross and Stirling, Scotland UK
Competent Persons Statement:
No new exploration results are presented in this report. All results have been
previously notified under JORC 2004 and are contained in Scotgold Annual
reports 2008 - 2019 and various corresponding market releases.
The information in this report that relates to the 2015 Mineral Resources for
Cononish Gold Project (refer ASX release - Resource Estimate Update -
22/01/2015) is based on information compiled by Malcolm Titley, a Competent
Person who is a Member of The Australasian Institute of Mining and Metallurgy.
Mr Titley is employed by CSA Global (UK) Limited, an independent consulting
company. Mr Titley has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
which he is undertaking to qualify as a Competent Person as defined in the
2012 Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves'. Mr Titley consents to the inclusion in
the report of the matters based on his information in the form and context in
which it appears.
The information in this report that relates to the 2015 Ore Reserves for
Cononish Gold Project (refer ASX announcement dated 26/05/2015) is based on
information compiled by Pat Willis, a Competent Person who is registered as a
Professional Engineer (Pr.Eng.) with the Engineering Council for South Africa
(ECSA) and a Fellow in good standing and Past President of the Southern Africa
Institute of Mining and Metallurgy (FSAIMM). Mr Willis is employed by Bara
Consulting Limited, an independent consulting company. Mr Willis has
sufficient experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in the 2012 Edition of
the 'Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves'. Mr Willis consents to the inclusion in the report of the
matters based on his information in the form and context in which it appears.
Further, the Company confirms it is not aware of any new information or data
that materially affects the information contained in the original
announcements and that all material assumptions and technical parameters
underpinning the estimate of Resources and Reserves continue to apply and have
not materially changed.
STRATEGIC REVIEW
The Company continues to review its corporate governance, structure, policies
and practices with a view to maintaining and enhancing shareholder value.
The Company adopted the QCA code of corporate governance in 2018 and
subsequently appointed an advisory service to assist with UK regulatory
compliance issues as an AIM listed company.
Operationally, the Company's immediate focus is the ramp up and completion of
phase two of the mine, where production is expected to hit 72,000 tonnes of
ore and 23,500 ounces of gold per annum.
Notably, a review of the strategic goals of the Company was conducted during
2021. The focus was modified to incorporate the following objectives and built
on the following six principles:
· Upon successful ramp up of the Cononish Mine, further increase
production through step wise optimisation until Phase 2 production has been
achieved, this is aimed for completion 2023;
· Optimise the current Cononish Reserve;
· Expand Resources and Reserves within the Cononish vein;
· Explore and develop within "The shadow of the head frame";
· Explore and develop near mine drill ready targets to develop
network of satellite deposits for processing at Cononish; and
· Continue to explore in a more focused manner within the most
prospective portion of lease holding.
CEO
Phil Day
16 December 2022
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
2022 2021
$ $
Revenue 17,782,186 299,807
Cost of sales (14,629,107) (299,807)
Profit (loss) from production operations 3,153,079 -
Interest income 7,737 8,285
Loss on settlement of loan (1,359,008) -
Other income - 416,007
Administration costs (2,020,799) (1,093,619)
Interest expense (1,597,168) (1,259,484)
Depreciation and loss on disposal of non-current assets (5,859,747) (1,314,847)
Employee and consultant costs, excluding share-based payments (1,806,020) (1,095,882)
Share-based payments (268,637) (364,725)
Listing and share registry costs (186,430) (193,023)
Currency exchange variances (847,991) (57,580)
Other expenses - (26,074)
LOSS BEFORE INCOME TAX (10,784,984) (4,980,942)
Income tax benefit - -
LOSS FOR THE YEAR (10,784,984) (4,980,942)
Other Comprehensive Income
Items that may be reclassified to Profit or Loss
Exchange difference on translation of foreign subsidiaries 376,015 765,392
Total comprehensive result for the year (10,408,969) (4,215,550)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
2022 2021
$ $
CURRENT ASSETS
Cash and cash equivalents 168,086 2,624,342
Trade and other receivables 4,686,404 448,336
Inventory 1,295,839 187,276
Other current assets 1,048,210 296,657
Total Current Assets 7,198,539 3,556,611
NON-CURRENT ASSETS
Trade and other receivables 1,463,125 1,579,820
Plant and equipment 14,515,295 16,280,930
Right-of-use assets 3,025,490 2,777,962
Mineral exploration and evaluation 3,051,622 2,990,000
Mine development asset 23,996,356 25,770,548
Total Non-Current Assets 46,051,888 49,399,260
TOTAL ASSETS 53,250,427 52,955,871
CURRENT LIABILITIES
Trade and other payables 3,999,379 2,306,453
Other current liabilities 1,100,811 873,977
Borrowings 1,175,358 7,927,888
Total Current Liabilities 6,275,548 11,108,318
NON-CURRENT LIABILITIES
Borrowings 22,266,513 11,986,714
Provisions 781,898 908,915
Total Non-Current Liabilities 23,048,411 12,895,629
TOTAL LIABILITIES 29,323,959 24,003,947
NET ASSETS 23,926,468 28,951,924
EQUITY
Issued capital 57,755,221 52,640,345
Reserves 1,430,619 785,967
Accumulated losses (35,259,372) (24,474,388)
TOTAL EQUITY 23,926,468 28,951,924
CONSOLIDATED STATEMENT OF CASH FLOWS
2022 2021
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 13,544,118 -
Payment to suppliers (18,466,016) (1,443,368)
Interest income received 7,737 8,285
Net Cash Outflow from Operating Activities (4,914,161) (1,435,083)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration expenditure - (428,794)
Payments for mine development activities (935,058) (10,249,942)
Purchase of plant and equipment (499,582) (803,791)
Proceeds on disposal of plant and equipment - 400
Net Cash Outflow from Investing Activities (1,434,640) (11,482,127)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares and options, net of costs - 7,661,686
Proceeds on draw-down of first tranche of unsecured loan 6,520,985 1,810,938
Proceeds on draw-down of secured loan 8,828,463 6,343,675
Payment of interest of secured loan (206,422) -
Repayment of drawn-down secured loan (8,591,808) -
Repayment of right-of-use leases (2,775,775) (1,297,746)
Net Cash Inflow from Financing Activities 3,775,443 14,518,553
Net increase (decrease) in cash held (2,573,358) 1,601,343
Effect of exchange rate fluctuations on cash and cash equivalents 117,102 3,020
Cash and cash equivalents at beginning of year 2,624,342 1,019,979
Cash and cash equivalents at end of year 168,086 2,624,342
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued Capital Accumulated Losses Options Reserve Share-based payment reserve Foreign Currency Translation Reserve Total Equity
YEAR ENDED 30 JUNE 2021 $ $ $ $ $ $
Balances at 1 July 2020 44,978,659 (19,493,446) 134,769 283,642 (1,015,000) 24,888,624
Total comprehensive result for the year - (4,980,942) - - 765,392 (4,215,550)
Transactions with owners in their capacity as owners:
Issue of 8,147,502 - - - 8,147,502
shares
Share-based payments - - - 617,164 - 617,164
Share issue expenses (485,816) - - - - (485,816)
52,640,345 (24,474,388) 134,769 900,806 (249,608) 28,951,924
YEAR ENDED 30 JUNE 2022
Balances at 1 July 2021 52,640,345 (24,474,388) 134,769 900,806 (249,608) 28,951,924
Total comprehensive result for the year - (10,784,984) - - 376,015 (10,408,969)
Transactions with owners in their capacity as owners:
Issue of shares 5,114,876 - - - - 5,114,876
Share-based payments - - - 268,637 - 268,637
Balances at 30 June 2022 57,755,221 (35,259,372) 134,769 1,169,443 126,407 23,926,468
These consolidated financial statements should be read in conjunction with the
accompanying notes.
The Notes to and forming part of the consolidated Financial Statements for the
year ended 30 June 2022 can be found in the full version of Scotgold's Annual
Report and Accounts for the year Ended 30 June 2022, available via the
Company's website and will be sent to shareholders in due course.
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 FR URUARUUUUUUARecent news on Scotgold Resources
See all newsREG - AIM Scotgold Resources - Cancellation - Scotgold Resources Limited
AnnouncementREG - Scotgold Resources - Appointment of Administrators
AnnouncementREG - Scotgold Resources - Planned Appointment of Administrators
AnnouncementREG - Scotgold Resources - Director Resignation
AnnouncementREG - Scotgold Resources - Potential Administration Appointment
Announcement