REG - Xtract Resources plc - Half-year Report
27/09/2024 11:15
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240927:nRSa0377Ga&default-theme=true
RNS Number : 0377G Xtract Resources plc 27 September 2024
For immediate release
27 September 2024
Xtract Resources Plc
("Xtract" or "the Company")
Unaudited Interim Results for the six months ended 30 June 2024
Xtract Resources Plc (AIM: XTR), the gold producer, exploration and
development company with projects in Zambia and Australia, announces its
unaudited interim results for the six months ended 30 June 2024 ("Period").
Highlights
Operational
· Xtract has increased its licence position in the prospective
Western Foreland district of Northwest Zambia via an amended joint venture
agreement with Cooperlemon PLC, bringing its total land holding at the Western
Foreland project to 5 licences, and a total 173,586 hectares
· The Western Foreland is rapidly emerging as the global frontier
district for the discovery of new Tier One copper deposits, with many of the
global leading mining companies actively exploring for new deposits of
sediment hosted copper mineralisation
· The Western Foreland represents an underexplored extension of the
Central African Copperbelt, host to the high-grade Kamoa-Kakula deposit, which
is arguably amongst the world's most productive copper mines, and the
development of which has stimulated a broad re-modelling of the district's
geology
· A new joint venture agreement was completed with Oval Mining
Corporation, with the option to earn a 70% interest of the Silverking Mine in
Central Zambia which is prospective for Iron Oxide Copper Gold (IOCG)
mineralisation.
· Previous exploration completed at Silverking by Glencore in 2012
identified high-grade, breccia-hosted copper mineralisation, including
downhole intersections of up to 50m at 5.47% copper from 55m downhole depth,
with individual 1m intercepts peaking at 52.2% copper, and the drillhole ended
in mineralisation.
· Data compilation, ground truthing and target identification
dominated works completed at the Western Foreland and Silverking projects
during the reporting period, with the anticipation that priority zones will be
drill ready by the close of the year.
· Second stage ore pre-concentration analysis was completed by
independent consultants Altrius Consulting Pty, which recommended further ore
upgrade test work be completed to help assess the feasibility of the
Bushranger copper gold project, in Australia.
· Samples from Bushranger have been sent away for pre-screen,
gravity separation, and coarse particle flotation test work, with preliminary
results reported to be favourable
· The company announced a strategic decision to dispose of its 23%
shareholding in the Manica project, Mozambique.
· Staged payments of up to US$15million be made to the company by
the purchaser of Manica, MMP (the company's partner), by 1 March 2027,
providing steady income from assets with which to fund exploration in
Zambia.
Financial
· Revenue from gold sales of £Nil (H1 2023: £0.39m)
· Other revenue of £Nil (H1 2023: £1.67m)
· Net Profit /(loss) loss of £0.16m (H1 2023: profit of £0.62m)
· Administration & operating expenses £0.82m (H1 2023:
£1.05m)
· Cash of £2.00m (FY 2023: £0.63m)
· Total assets of £20.26m (FY 2023: £21.93m)
Operational Overview
The company has focussed its efforts on increasing its land position in
Central and Northwest Zambia where it joins many of the global top tier mining
companies in the race for copper discovery in the emerging Western Foreland
district. The Company has increased its landholding via joint venture
partnerships, with an additional three licences added to its Western Foreland
project in Northwestern Zambia, bringing the total licence position to five, a
significant tenure position.
The Western Foreland District represents a highly prospective region for
copper exploration. Adjacent to the Central African Copperbelt, this
underexplored area shares similar geological features with the neighbouring
Kamoa-Kakula deposit, including favourable stratigraphy and structural
settings conductive to hosting large, high-grade sediment-hosted copper
deposits. Recent discoveries and ongoing exploration efforts suggest
significant potential for new, world-class copper finds, making the Western
Foreland District a strategic frontier for future mining developments.
Further south, in Central Zambia, Xtract has secured a Joint Venture position
at the historic Silverking Mine, which is considered highly prospective for
Iron Oxide Copper Gold (IOCG) mineralisation, associated with
breccia-controlled copper mineralisation, already identified on the
property.
In Australia, Xtract holds a 100% interest in the Bushranger Copper-Gold
Project, in the Lachlan Fold Belt, New South Wales. The project contains two
porphyry deposits with 2022 JORC (2012) compliant combined total resources of
599Mt @ 0.22% CuEq, which the company is progressing through mine scoping
studies.
Western Foreland Project, Zambia
On 31 May 2024, the company announced an addendum to its Joint Venture with
Cooperlemon Consultancy Limited, including an update to its licence position
at the Western Foreland project. Three additional licences, namely licence
numbers 30458-HQ-LEL, 21851-HQ-LEL and 21850-HQ-LEL were added to the
agreement, bringing the new total land position held to five licences, for a
total area of 173,586 hectares.
Under the terms of the restated joint venture agreement Xtract will earn an
initial 65% interest in the additional licences by funding exploration of not
less than US$500,000 on each of the three additional licences over an initial
two-year period commencing on the date of the restated agreement. As
previously reported, Xtract will earn a 65% interest in the original licences
by funding exploration expenditure over an initial two-year period commencing
on 23 August 2023 of not less than US$2 million, bringing Xtract's aggregate
total commitment under the restated agreement to US$3.5 million.
All five licences cover ground in the Western Foreland geological district of
northwestern Zambia, an emerging copper district, underexplored to date and
subject to fresh geological remodelling propelled by the top global
exploration companies. Significant potential exists for the discovery of new,
high-grade, high-tonnage, deposits of copper akin to Ivanhoe Mines
Kamoa-Kakula complex, situated just 100km along strike, over the border in the
Democratic Republic of Congo. Ivanhoe Mines continues to make discoveries in
the region, and has reported a total of 48Mt of copper discovered since 2008,
with recent exploration at Ivanhoe's Kitoko deposit discovering copper
mineralisation in previously unknown stratigraphic sequences highlighting the
prospectivity of additional stratigraphic units and further widening
exploration potential in the whole region.
In the Western Foreland geological terrane, the Company is using the Kamoa -
Kakula deposit model to explore for copper mineralisation associated with
prospective redox fronts in the ancient Western Foreland sedimentary basin
architecture, where structural geology and reducing traps play an important
role in concentrating circulating mineralising fluids, leading to deposition
of copper in stratabound sediments.
Work completed at the project during the reporting period focussed on
preparing drill ready targets, and post year-end it was reported that
significant ground truthing had been completed, including detailed mapping of
lithologies most likely to foster redox fronts. Drill collar locations are
being selected and prioritised, with all the required permits and approvals
being facilitated by the company's joint venture partner, Cooperlemon
Consultancy.
Reconnaissance work carried out in the adjoining Fold & Thrust Belt
focussed on identifying the origins of surface artisanal mining activity and
copper showings, targeting mineralised rafts, which are typical in the Fold
& Thrust Belt.
Western Foreland Background Geology
The geology of the Licence areas is dominated by the architectural domains
known as the Western Foreland succession (host to high-grade Kamoa-style
mineralisation) and the neighbouring Lufilian Fold & Thrust Belt that
plays host to lower- grade, bulk tonnage, near-surface mineralisation of the
Kolwezi-type. Licence 29123 - HQ - LEL is located to the west of the perceived
boundary between the Western Foreland and the Fold Belt, while the four other
licences (30458 - HQ - LEL, 30459-HQ- LEL, 21850-HQ-LEL and 21851-HQ-LEL) are
coincident with the boundary and the Fold Belt. The Company believe there is
scope for the discovery of both high-grade Kamoa-style mineralisation at depth
and lower grade Kolwezi-type mineralisation at or near-surface on all five
licences.
With the rise in demand for the discovery of new copper resources, NW Zambia
is currently at the forefront of a rapid phase of geological re-modelling and
renewed exploration thinking. The area has been highlighted as a prime
geological target for prospective high-grade copper mineralisation which has
led to intense competition for exploration licences, with many of the world's
top tier mining companies dominating the space and pioneering the geological
remodelling of the area. The five licences are projected to have continuity
with the geology of the DRC, which is home to many top-tier copper mines, and
are surrounded by ground under licence to, or within partnerships or joint
ventures between local companies and global leaders in the mining industry
such as Rio Tinto plc, Anglo American plc, First Quantum Minerals Ltd., and
Ivanhoe Mines. The density of Tier 1 mining companies in the region reflects
the significant prospectivity of the Joint Venture licences.
Silverking Copper Project, Zambia
On 3 April 2024, the Company announced that it had entered a joint venture
agreement with Oval Mining Limited, which is acting in cooperation with
Cooperlemon Consultancy Limited, to earn up to a 70% interest in the
Silverking copper mine and accompanying exploration licence 26673-HQ-LEL. The
81.7km2 licence is located west of Lusaka, in the Mumbwa district, Central
Province of Zambia, and is prospective for deposits of copper associated with
the Iron Oxide Copper Gold (IOCG) model. The project sits adjacent to the
Kitumba deposit, which received a 65% investment acquisition from Chinese
investors Sinomine Resource Group in March 2024.
Mineralisation at Silverking is broadly associated with a breccia pipe, and
characterised by deep levels of intense oxidation, breccia, vein and stockwork
hosted copper, further distinguished by high-grade supergene enrichment, which
is diagnostic of the nearby Kitumba deposit. The former Silverking open pit
and underground mine extends to a mining depth of just 70m, with historic
drilling suggesting the deposit remains open both down-dip, and along strike.
Historical drilling was exceptionally high-grade, including a best intercept
of 50m @ 5.47% Cu in drillhole SVKRC002 from 55m to 105m depth, with
mineralised intercepts peaking at 52.2% Cu from a 1m interval, and the hole
ended in mineralisation.
Historical work completed on the licence by Glencore included ground magnetic
and Induced Polarisation (IP) surveys, and a wide-spaced surface geochemical
survey, which identified several targets warranting follow-up work; including
a second breccia pipe, located 800m from the main Silverking mineralised body,
which has not been explored. Surface evidence suggests potential stockwork and
disseminated copper mineralisation between the two breccia pipes, and the IP
signature suggests potential for a lower-grade mineralised stockwork
surrounding the main Silverking breccia pipe, which has not been followed-up.
Additional prospectivity exists when it is considered that the wide spaced
nature of the historical geochemistry survey could have easily missed a
breccia pipe.
An in-house, non-JORC (2012) compliant resource estimate, by an external
contract geological company was commissioned by Glencore in 2012
("Non-Compliant Resource"). The Non-Compliant Resource reported an estimate of
268,971 tonnes at 2.7% Cu at a 0.5% Cu cut-off for the main Silverking breccia
pipe only. Shareholders should note that as the Non-Compliant Resource was not
prepared to any acceptable AIM Standard, no reliance can be placed on the
Non-Compliant Resource, and it is therefore only illustrative. The down-dip
and strike extensions of the known pipes and other anomalies (geochemical and
geophysical) remain largely untested as does the balance of the licence where
only broad-based reconnaissance-type exploration has been undertaken
Historical data compilation, ground truthing and a full review and
interpretation of historical geophysical data took priority in the reporting
period, with initial results suggesting the historical diamond drilling
programme completed by Glencore may not have been optimal, with high-grade
supergene mineralisation not targeted down-dip or down-plunge, and drillholes
were limited to one hole per anomaly, reflecting the strategy at that time of
targeting a Tier 1 discovery.
Silverking Project Background
The licence area is prospective for high-grade copper mineralisation
associated with breccia pipes, and covers an area of approximately 81.7km2 in
the Karenda area of the prospective Mumbwa District. The Silverking Mine
mineralisation represents a defined breccia pipe characterised by deep levels
of intense oxidation, breccia, vein and stockwork hosted copper
mineralisation, and is distinguished by high-grade supergene enrichment.
Kakuyu Copper - Cobalt Project, Zambia
Work completed by Xtract has focused on defining the potential for a future
open pit mining operation, as well as assessment of the wider licence area for
concentrations of additional mineralisation.
Kakuyu Project Background
The Kakuyu Project covers 53km of prospective ground in Central Zambia, near
the town of Mumbwa, where potential exists for the discovery of IOCG copper
mineralisation. The region is well-known for mining, including the nearby
mines and occurrences of Sable Antelope, True Blue, Crystal Jacket, Maurice F
Gifford, Lou Lou, Silverking and Kamiyobo. The most recent discovery is the
Kitumba Iron Oxide Copper Gold deposit.
The Kakuyu project comprises a small-scale mining licence and adjacent
exploration licence, inclusive of the small historic Kakuyu open pit, which
was subject to mining operation prior to acquisition.
Manica Gold Project, Mozambique
On 24 January 2024 Xtract announced plans for the disposal of its 23% interest
in the Manica Gold project, Mozambique. This was a strategic decision,
allowing the Company the opportunity to focus on its new copper interests in
Zambia, and progress feasibility studies at Bushranger, the decision further
reflected the opportunity to dispose of potential financial risk associated
with the Manica project as it progressed towards the complex ore mining phase.
As part of the sale, an initial US$3.325m was paid under the terms of the
Mining Collaboration Agreement, received from its partner MMP, releasing
Xtract and Explorator (Xtract's local Mozambique subsidiary) from the
collaboration agreement, with up to a further US$15m to be settled via staged
payments to 1 March 2027. Under the sale agreement, if the buyer fails to meet
the staged payment schedule, the exploration licence and mineral resource will
be returned to Xtract.
The disposal decision was based on an assessment of the risks associated with
the future nature of the ore to be extracted from the Manica project. As the
volume of the more simply processed oxide ore is depleted, the project moves
into the more complex mixed oxide/sulphide mining stage, which has yet to be
fully scoped. Inconclusive studies projecting the metallurgy and recovery of
gold in deeper sulphide mineralisation, incomplete information regarding
future capital expenditure for sulphide mining and necessary infrastructure
improvements, and the limited capacity for Xtract management to have influence
during the decision-making process as a minority shareholder were all risk
factors taken into consideration.
Bushranger Copper-Gold Project, Australia
Work in the reporting period focussed on appraisal of the financial viability
of the project, including the receipt of results of a second stage
pre-concentration study completed for the company by Altrius Consulting Pty.
In continuation from previous Tomra ore sorting test work, which was deemed
unviable by Altrius, the review recommended further consideration of alternate
ore pre-concentration test work, including pre-screening, gravity separation
and coarse particle flotation techniques.
Based on the recommendations, samples have therefore been submitted for test
work, including a sample sent to ALS in Perth for pre-screening and dense
media separation analysis, and a second sent to NovaCell, for coarse particle
flotation test work, which is progressing favourably. This work follows on
from a revised mine optimisation study completed by Optimal Mining Solutions
(Pty) in 2023, which investigated the economics of 5Mtpa, 20Mtpa and 25Mtpa
operations, and concluded that the current Racecourse Prospect Mineral
Resource has the potential to be economically mined at mining rates of 20Mtpa,
or greater, and at copper prices of US$10,000/t and above. The study further
recognised that optimisation of ore pre-concentration, the processing plant
capacity, capital & operating costs, and metallurgical recoveries could
greatly improve the economic outcomes of mining the Racecourse deposit
Enquiries:
Xtract Resources Plc Colin Bird, Executive Chairman +44 (0)20 3416 6471
Beaumont Cornish Roland Cornish +44 (0)20 7628 3369
(Nominated Adviser and Michael Cornish
Joint Broker) Felicity Geidt
Email: corpfin@b-cornish.co.uk (mailto:corpfin@b-cornish.co.uk)
Novum Securities Limited Colin Rowbury/Jon Belliss +44 (0)207 399 9427
(Joint Broker)
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018 ("UK MAR"). The person who arranged for
the release of this announcement on behalf of the Company was Joel
Silberstein, Director.
Further details are available from the Company's website which details the
company's project portfolio as well as a copy of this
announcement: www.xtractresources.com (http://www.xtractresources.com)
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.
Glossary
basin A regional depression which may be structural in origin.
breccia pipe A mass of breccia (rock comprising of broken fragments of mineral or rock
cemented together by a fine-grained matrix), often in an irregular or
cylindrical shape
Cu Copper
Induced Polarisation (IP) A method of ground geophysical surveying which employs the passing of an
electrical current into the ground to test for indications of conductive
metallic sulphides.
IOCG (iron oxide copper-gold) deposits Mineral deposits that typically occur at the margins of large igneous bodies
which intrude into sedimentary strata, often forming pipe-like, mantle-like or
extensive breccia-vein sheets within the host stratigraphy
Mineral Resource A concentration or occurrence of solid material of economic interest in or on
the Earth's crust in such form, grade (or quality), and quantity that there
are reasonable prospects for eventual economic extraction. The location,
quantity, grade (or quality), continuity and other geological characteristics
of a Mineral Resource are known, estimated or interpreted from specific
geological evidence and knowledge, including sampling. Mineral Resources are
sub-divided, in order of increasing geological confidence, into Inferred,
Indicated and Measured categories (JORC 2012).
Mtpa Million Tonnes Per Annum
oxide minerals Minerals produced by natural weathering processes at or near the earth's
surface.
redox Oxidation/reduction reaction occurring in the weathering zone along the water
table.
reduced Chemical reaction in which the oxidation state of a rock is decreased
sediment hosted copper deposit Stratabound deposits of copper mineralisation, often formed prior to the
lithification of the host rock and independently of igneous processes
sedimentary basin region-scale depressions where thick sequences of sediments
(https://en.wikipedia.org/wiki/Sediment) are deposited forming sequences
of sedimentary rock (https://en.wikipedia.org/wiki/Sedimentary_rock) , they
are often structural in nature.
sedimentary rock Rock formed by compaction and cementation of sediments.
stockwork A large-scale ramifying series of fissures filled with mineralized material.
stratabound Occurring within a particular strata or layer.
sulphide A metallic compound of sulphur.
Xtract Resources PLC
Consolidated Income Statement
For the six-month period ended 30 June 2024
Six months ended Year ended
Notes 30 June 2024 30 June 31 December
Unaudited 2023 2023
£'000 Unaudited Audited
£'000 £'000
Continuing operations
Revenue from Gold sales 5 - 393 -
Other operating income 5 - 1,669 1,173
Other non-operating income - - -
Administrative and operating expenses (818) (1,051) (1,048)
Direct Operating - (601) (6)
Other Operating (201) (87) (198)
Administration (617) (363) (844)
Project expenses (23) (426) (322)
Operating profit/(loss) (841) 585 (197)
Other gains and losses 810 - -
Finance (cost)/income 115 37 25
Profit/(loss) before tax 84 622 (172)
Taxation (197) (1) (1)
Profit/(loss) for the period from continuing operations 3 (113) 621
(173)
(Loss)/Profit from discontinued operations (48) -
808
Profit/(loss) for the period 6 (161) 621 635
Attributable to:
Owners of the Company (161) 621 635
From continuing operations (113) 621 (173)
From discontinued operations (48) - 808
Basic (pence) 6 (0.02) 0.07 0.07
Diluted (pence) 6 (0.02) 0.07 0.07
Xtract Resources PLC
Consolidated statement of comprehensive income
For the six-month period ended 30 June 2024
Six months ended Year ended
30 June 30 June 31 December
2024 2023 Unaudited 2023
Unaudited £'000 Audited
£'000 £'000
Profit /(Loss) for the period (161) 621 635
Other comprehensive income
Items that will not be reclassified subsequently to profit and loss
Exchange differences on translation of foreign operations
(98) (716) (431)
Other comprehensive income/(loss) for the period (98) (716) (431)
Total comprehensive (loss)/income for the period (259) (95) 204
Attributable to:
Equity holders of the parent (259) (95) 204
(259) (95) 204
Xtract Resources PLC
Consolidated Statement of Financial Position
As at 30 June 2024
Notes 30 June 2024 Unaudited 30 June 2024 31 December
£'000 Unaudited 2023 Audited
£'000 £'000
Non-current assets
Intangible Assets 7 8,095 18,608 8,191
Property, plant & equipment 8 23 75 46
Other financial assets 7,689 - -
15,807 18,683 8,237
Current assets
Trade and other receivables 127 2,556 1,163
Inventories - 119 -
Other financial assets 2,320 - -
Cash and cash equivalents 2,002 375 630
4,449 3,050 1,793
Non-current assets for sale and assets of disposal groups - -
11,898
Total assets 20,256 21,733 21,928
Current liabilities
Trade and other payables 432 1,473 486
Other loans - 50 50
Current tax payable 197 297 -
629 1,820 536
Liabilities of disposal groups - - 1,506
Non-current liabilities
Environmental rehabilitation provision - 326 -
- 326 -
Total liabilities 629 2,146 2,042
Net current assets/(liabilities) 3,820 1,230 1,257
Net assets 19,627 19,587 19,886
Equity
Share capital 9 4,975 4,975 4,975
Share premium account 71,978 71,978 71,978
Warrant reserve - 304 -
Share-based payments reserve 2,106 2,122 2,106
Fair Value reserve - - -
Foreign currency translation reserve 122 (65) 220
Accumulated losses (59,554) (59,727) (59,393)
Equity attributable to equity holders of the parent 19,627 19,587 19,886
Total equity 19,627 19,587 19,886
Xtract Resources PLC
Consolidated statement of changes in equity
As at 30 June 2024
Share Capital Share premium account £'000 Warrant reserve Share-based payments reserve £'000 Fair Foreign currency translation reserve £'000 Accumulated losses Total Equity
£'000 £'000 value £'000 £'000
reserve
£'000
Balance at 31 December 2022 4,975 71,978 304 2,121 - 651 (60,347) 19,682
Profit for the period - - - - - - 621 621
Foreign currency translation difference - - - - - (716) - (716)
Issue of Shares - - - - - - - -
Exercise of warrants - - - - - - - -
Balance at 30 June 2023 4,975 71,978 304 2,121 - (65) (59,726) 19,587
Profit for the period - - - - - - 14 14
Issue of Shares - - - - - - - -
Foreign currency translation difference - - - - - 285 - 285
Share issue costs - - - - - - - -
Expiry of share options - - - (15) - - 15 -
Expiry of warrants - - (304) - - - 304 -
Exercise of warrants - - - - - - - -
Balance at 31 December 2023 4,975 71,978 - 2,106 - 220 (59,393) 19,886
Profit/(loss) for the period - - - - - - (161) (161)
Foreign currency translation difference - - - - - (98) - (98)
Issue of Shares - - - - - - - -
Exercise of warrants - - - - - - - -
Balance at 30 June 2024 4,975 71,978 - 2,106 - 122 (59,554) 19,627
Xtract Resources PLC
Consolidated Statement of Cash Flows
For the six-month period ended 30 June 2024
Notes 6 months period ended 6 months period ended
30 June 2024 30 June 2023 Year ended
Unaudited Unaudited 31 December
£'000 £'000 2023
Audited
£'000
Net cash used in operating activities 10 119 330 1,209
Investing activities
Acquisition of intangible fixed assets - (56) (57)
Acquisition of tangible fixed assets - (43) (44)
Sale of financial assets 1,180 - -
Net cash from/(used in) investing activities 1,180 (99) (101)
Financing activities
Proceeds on issue of shares - - -
Repayment of borrowings (50) - -
Net cash from financing activities - - -
Net increase/(decrease) in cash and cash equivalents 1,249 231 1,108
Cash and cash equivalents at beginning of period 630 192 192
Cash disclosed as part of disposal group - (770)
Effect of foreign exchange rate changes 123 (49) 100
Cash and cash equivalents at end of period 2,002 374 630
Xtract Resources PLC
Notes to the interim financial information
For the six-month period ended 30 June 2024
1. General information
Xtract Resources PLC ("Xtract") is a company incorporated in England and Wales
under the Companies Act 2006. The Company's registered address is 1(st) Floor,
7/8 Kendrick Mews, London, SW7 3HG. The Company's ordinary shares are traded
on the AIM market of the London Stock Exchange. The Company invests and
engages in the management, financing and development of early-stage resource
assets.
2. Accounting policies
Basis of preparation
Xtract prepares its annual financial statements in accordance with UK-adopted
international accounting standards and in conformity with the Companies Act
2006.
The consolidated interim financial information for the period ended 30 June
2024 presented herein has been neither audited nor reviewed. The information
for the period ended 31 December 2023 does not constitute statutory accounts
as defined in section 434 of the Companies Act 2006 but has been derived from
those accounts. The auditor's report on those accounts was not qualified and
did not contain statements under section 498 (2) or (3) of the Companies Act
2006. As permitted, the Group has chosen not to adopt IAS 34 'Interim
Financial Reporting'.
The Interim financial information is presented in pound sterling and all
values are rounded to the nearest thousand pounds (£'000) unless otherwise
stated.
The interim consolidated financial information of the Group for the six months
ended 30 June 2024 were authorised for issue by the Directors on 26 September
2024.
Going concern
As at 30 June 2024 the Group held cash balances of £2 million. A small
operating loss has been reported for the Group.
On 24 January 2024, the Company announced that it had agreed terms for the
disposal of the Manica Gold Project with its Mozambique partner, MMP. The
Share Purchase Agreement in relation to the sale by the Company of its entire
interests in the project for a consideration of up to US$15 million in cash in
regular staged payments by the Buyers over the period to 1 March 2027.
As at the date of the release of the consolidated financial information, the
Group had received the 3(rd) quarterly payment of US$0.75m from the proceeds
of the sale of the Manica Asset . The Group has continued with its exploration
activities in Zambia and Australia.
The Directors anticipate net operating cash inflows for the Group for the next
twelve months from the date of signing these financial statements.
The Directors have assessed the working capital requirements for the
forthcoming twelve months and have undertaken assessments which have
considered different scenarios based on exploration spend on its exploration
projects in Zambia and Australia until September 2025.
Upon reviewing those cash flow projections for the forthcoming twelve months,
the directors consider that the Company is not likely to require additional
financial resources in the twelve-month period from the date of approval of
these financial statements to enable the Company to fund its current
operations and to meet its commitments. The Group will continue to monitor
corporate overhead costs on an ongoing basis.
The Directors therefore continue to adopt the going concern basis of
accounting in preparing the consolidated financial information and therefore
the consolidated financial information does not include any adjustments
relating to the recoverability and classification of assets and liabilities
that may be necessary if the going concern basis of preparation of the
consolidated financial information is not appropriate.
On this basis the Board believes that it is appropriate to prepare the
consolidated financial information on the going concern basis.
Changes in accounting policy
The accounting policies applied are consistent with those adopted and
disclosed in the Group Consolidated financial statements for the year ended 31
December 2023, except for the changes arising from the adoption of new
accounting pronouncements detailed below.
There are no amendments or interpretations to accounting standards that would
have a material impact on the financial statements.
3. Business segments
Segmental information
The divisions on which the Group reports its primary segment information are
reported to its Executive Chairman, who is the Chief Operating Decision maker
of the Group. The Executive Chairman and the Chief Operating Officer are
responsible for allocating resources to the segments and assessing their
performance.
Principal activities are as follows:
● Operating alluvial gold & hard rock mining segment - Mozambique
● Mine Development - Mozambique
● Exploration
● Investment and other
Segment results Total
6 months ended 30 June 2024 Investment
Exploration (Continuing) And Other
(Continuing)
£'000 £'000 £'000
Administrative and operating expenses - (818) (818)
Direct Operating - - -
Other Operating - (201) (201)
Administration - (617) (617)
Project expenses - (23) (23)
Operating profit/(loss) - (841) (841)
Other gains and losses - 810 810
Finance (cost)/income - 115 115
Profit/(loss) before tax - 84 84
Taxation (197) (197)
Profit/(loss) for the period from continuing operations - (113) (113)
Mine Development (Continuing) Investment and Other (Continuing) Total
6 months ended 30 June 2023
Alluvial Gold Mining Production (Continuing)
Exploration (Continuing)
£'000
£'000 £'000 £'000 £'000
Segment revenue
Sale of gold bars - - - 393 393
Less: Cost of sales - - - - -
Segment Gross profit - - - 393 393
Other operating income - - 1,669 - 1,669
Non-operating income
Administrative and operating expenses
- (94) (352) (605) (1,051)
Project Costs - (184) (34) (208) (426)
Segment result - (278) 1,283 (420) 585
Other gain and losses - - - - -
Finance costs - - 47 (10) 37
(Loss)/profit before tax - (278) 1,330 (430) 622
Tax - - - (1) (1)
(Loss)/Profit for the period - (278) 1,330 (431) 621
Year 31 December 2023 Investment and Other (Continuing) Total
Exploration (Continuing)
£'000 £'000 £'000
Other operating income - 1,173 1,173
Administrative and operating expenses
- (1,048) (1,048)
Project Costs - (322) (322)
Segment result - (197) (197)
Other gains and losses - - -
Finance income / (costs) - 25 25
(Loss)/Profit before tax - (172) (172)
Tax - (1) (1)
(Loss)/Profit for the period - (173) (173)
Balance Sheet 30 June 2024 30 June 2023 31 December 2023
£'000 £'000 £'000
Total Assets
Gold production - 11,252 -
Exploration 8,234 8,277 8,347
Investment & other 2,021 2,212 1,683
Total segment assets 10,255 - 10,030
Assets relating to discontinued operations 10,008 - 11,898
Consolidated total assets 20,263 21,741 21,928
Liabilities
Gold production - (1,632) -
Exploration (222) (133) (192)
Investment & other (406) (390) (342)
Total segment liabilities (628) (2,155) (534)
Liabilities relating to discontinued operations - - (1,506)
Consolidated total liabilities (628) (2,155) (2,040)
The accounting policies of the reportable segments are the same as the Group's
accounting policies which are described in the Group's latest annual financial
statements. Segment results represent the profit earned by each segment
without allocation of the share of profits of associates, central
administration costs including directors' salaries, investment revenue and
finance costs, and income tax expense. This is the measure reported to the
Group's Board for the purposes of resource allocation and assessment of
segment performance.
4. Tax
At 30 June 2024, the Group has no deferred tax assets or liabilities and other
taxes of £0.2 million (2023: £nil) charge for the period.
5. Revenue & Other revenue
An analysis of the Group's revenue is as follows:
Six months ended Year ended
30 June 2024 30 June 2023 31 December 2023
£'000
£'000 £'000
Revenue from gold sales - 393 -
- 393 -
Other revenue - 1,669 1,173
- 1,669 1,173
Other revenue relates to the 23% net profit share received in 2023 from its
operations in Mozambique.
6. Loss per share
The calculation of the basic and diluted loss per share is based on the
following data:
Year ended
Six months ended
Profit/(Losses) 30 June 2024 30 June 2023 31 December 2023
£'000
£'000 £'000
Profit/(Losses) for the purposes of basic earnings per share being: (161) 621
Net (loss)/ Profit from continuing operation attributable to equity holders of
the parent
635
(161) 621 635
Number of shares
Weighted average number of ordinary and diluted shares for the purposes of 856,375,115 856,375,115
basic earnings per share
856,375,115
(Loss)/profit per ordinary share basic and diluted (pence) (0.02) 0.07 0.07
In accordance with IAS 33, the share options and warrants do not have a
dilutive impact on earnings per share, which are set out in the consolidated
income statement. Details of the shares issued during the period as shown in
Note 9 of the Financial Statements.
7. Intangible assets
Development expenditure & Mineral exploration
Total
£'000 £'000
As at 1 January 2024 8,191 8,191
Additions - at fair value (Bushranger) - -
Additions - at cost (Bushranger) - -
Foreign exchange (96) (96)
As at 30 June 2024 8,095 8,095
Amortisation
As at 1 January 2024 - -
Charge for the year - -
As at 30 June 2024 - -
Net Book value at 1 January 2024 8,191 8,191
Net book value at 30 June 2024 8,095 8,095
Mozambique
In March 2016, The Company acquired the Manica licence 3990C ("Manica
Project") from Auroch Minerals NL. The Manica Project is situated in central
Mozambique in the Beira Corridor. At the time of acquisition, the project had
a JORC compliant resource of 900koz (9.5Mt@ 3.01g/t) in situ, which increased
to 1.257moz (17.3Mt @ 2.2g/t) following an independent technical report
completed by Minxcon (Pty) Ltd in May 2016.
On 24 January 2024, the Company announced that it had agreed with its
Mozambique partner, MMP, and parties related to MMP terms for the disposal of
the Manica Gold Project.
The Company agreed to sell its 23% net profit share interest in the Manica
Gold Project (by way of a sale of the entire issued share capital of Mistral)
to the Buyers for a consideration of up to US$15 million in cash in regular
staged payments by the Buyers over the period to 1 March 2027.
As at 31 December 2023, the carrying amount relating to the Mozambican asset
has been transferred to the assets of a disposal group.
Australia
In November 2020, the Company acquired the Bushranger copper-gold project
("Bushranger Project") which comprises of four exploration licences totalling
501km2, located in eastern central New South Wales, Australia. The Bushranger
Project hosts the Racecourse deposit, a JORC (2012) compliant inferred
resource estimated at 71Mt @ 0.44% Cu and 0.064g/t Au using a 0.3% Cu cut-off.
8. Property, plant and equipment
Cost or fair value on acquisition of subsidiary Motor Vehicles & equipment Land & Buildings Furniture & Fittings Total
£'000 £'000 £'000 £'000
At 1 January 2024 82 - - 82
Additions - at cost - - -
Foreign exchange (4) - - (4)
At 30 June 2024 78 - - 78
Depreciation
At 1 January 2024 36 - - 36
Charge for the period 19 - - 19
At 30 June 2024 55 - - 55
Net book value
At 30 June 2024 23 - - 23
At 1 January 2024 46 - - 46
9. Share capital
As at As at As at
30 June 2024 Number 30 June 2023 31 December 2023
Number Number
Deferred shares of 0.09p each
As at 1 January 5,338,221,169 5,338,221,169 5,338,221,169
Issued during the period - - -
5,338,221,169 5,338,221,169 5,338,221,169
Ordinary shares of 0.02p each
As at 1 January 856,375,115 856,375,115 856,375,115
Issued during the period - - -
Outstanding as at 30 June 856,375,115 856,375,115 856,375,115
No Ordinary Shares of 0.02p were issued during the period.
10. Cash flows from operating activities
Six month
period ended
Six month 30 June 2023 Year ended
period ended £'000 31 December 2023
30 June 2024 £'000 £'000
Profit/(loss) for the period 84 621 (173)
Profit/(loss) - disposal group - - 1,488
Adjustments for:
Continuing Operations
Depreciation of property, plant and equipment 19 6 212
Amortisation of intangible assets - 202 -
Net Finance costs (76) 70 63
Impairment of intangible assets - - -
Interest income (115) (107) -
Other (gains) /losses (779) - -
Share-based payments expense - - -
Operating cash flows before movements in working capital - 792
1,590
Decrease/(Increase) in inventories - 6 (81)
(Increase)/decrease in receivables 1,036 (1,223) (172)
(Decrease)/increase in payables (53) 723 177
Cash (used in)/ generated from operations 116 298 1,514
Net finance costs 3 47 (263)
Tax (paid) - (78) (263)
Net finance costs 3 47 (42)
Net cash from/ (used in) operating activities 119 330 1,209
11. Related party transactions
There have been no changes to related party arrangements or transactions as
reported in the 2023 Annual Report.
Transactions between Group companies, which are related parties, have been
eliminated on consolidation and are therefore not disclosed. The only other
transactions which fall to be treated as related party transactions are those
relating to the remuneration of key management personnel, which are not
disclosed in the Half Yearly Report, and which will be disclosed in the
Group's next Annual Report.
12. Discontinued Operations
Prior to December 2023, the group decided to discontinue its operations in
Mozambique, which were sold in February 2023 . The assets and liabilities of
the disposal group are set out below:
30 June 30 June 31 December
2024 2023 2023
£'000 £'000 £'000
Profit & loss
Revenue 440 - 2,650
Other income - - 413
Expenses (489) - (1,575)
Net Profit before tax (48) - 1,488
Tax - - (680)
(48) - 808
Assets and liabilities
Non-current assets held for
Other assets - - -
Assets of disposal groups
Property, plant and equipment - - 26
Intangible assets - - 10,552
Trade and other receivables - - 345
Cash and cash equivalents - - 770
Inventories - - 205
- - 11,898
Liabilities of disposal groups
Trade payables - - 443
Tax payable and provisions - - 1,064
Trade and other Payables - - 1,507
13. Post balance sheet events
There were no reportable events after balance sheet date.
ENDS
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 IR BGGDCDGDDGSRRecent news on Xtract Resources
See all newsREG - Xtract Resources plc - Silverking Project Drilling Update
AnnouncementREG - Xtract Resources plc - Silverking Project drilling update
AnnouncementREG - Xtract Resources plc - Silverking Project drilling update
AnnouncementREG - Xtract Resources plc - Western Foreland Exploration Update
AnnouncementREG - Xtract Resources plc - Silverking Project Commencement of Drilling
Announcement