TIDMGDP
RNS Number : 3779R
Goldplat plc
29 October 2019
Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining &
Exploration
29 October 2019
Goldplat plc
('Goldplat', the 'Group' or 'the Company')
Quarterly Update
Goldplat plc, the AIM listed gold producer, with international
gold recovery operations located in South Africa and Ghana and a
gold mine in Kenya, is pleased to announce an operational update
for the three months ending 30 September 2019 (the 'Quarter') and a
return to Group profitability before and after tax.
The following events have contributed to the improved
performance during the Quarter -
-- The continued production in South Africa was supported by the increase in gold price;
-- Increase in production levels in Ghana due to increase in material sourced;
-- Reduction in losses at Kilimapesa due to the mine being on
care and maintenance, with only artisanal tailings being processed
to contribute towards the costs of care and maintenance;
-- Cost reductions and improved operational efficiencies
throughout the Group over the past year are contributing to
profitability, including cost reductions on central group
overheads;
-- Improvement in certain plant operational efficiencies have
not only reduced costs but improved gold recovery;
-- Some of the cost savings have been invested into material
sourcing initiatives and increasing physical security in South
Africa.
We remain committed to our key initiatives of increasing long
term visibility of earnings in the recovery business and finding an
investment partner or buyer for Kilimapesa.
We aim to achieve improved visibility of earnings in the
recovery business through:
-- improving our gold recoveries from lower grade contaminated
material so that this type of material can be treated profitably.
Reserves of lower grade materials are more readily available and
where we can source stockpiles of this material the sourcing risk
is alleviated;
-- Increased investment into sourcing initiatives and test work
on a wider range of materials, including PGM discards.
To help shareholders' understanding of the Group's performance
we are also pleased to initiate quarterly reporting of the sales
and operating profit, on an unaudited basis, of each principal
operating entity.
Goldplat Recovery (Pty) Ltd ('GPL')
GPL maintained good production levels and recorded sales during
the Quarter of GBP4,479,000. In comparison, sales in the first
quarter of the previous financial period (QTR1 FY2019:
GBP3,374,000) were low because of specific production issues. The
improvement in production levels year-on-year, supported by higher
gold prices, resulted in an increase in quarterly operating profit
to GBP1,074,000 (QTR1 FY2019: loss of GBP252,000).
Towards the end of the Quarter, we started to install the first
stage of a pre-treatment section to the largest CIL section at a
cost of GBP70,000. Pre-treatment is intended to improve recoveries
of and margins on lower grade contaminated material and together
with efforts to reduce operating costs, should allow us to source
and profitably process lower grade contaminated material.
Our tailings storage facility ('TSF') is approaching full
capacity in its current form and we will be spending GBP250,000
during the quarter to increase its life by a further 12 to 18
months. After consultation with various governmental departments we
have concluded that the costs we will need to incur to allow us to
deposit into West Pit 3 will be more than those needed to extend
our current TSF. In addition, we have started the design of the a
TSF which we plan to be approved, constructed and commissioned
during the next 12 months at an estimated cost of between
GBP500,000 to GBP700,000.
Once we have established the new TSF, the existing TSF, which
contains circa 88,000 oz of gold, can be allowed to dry out after
which we can look at monetising this asset.
Gold Recovery Ghana ('GRG')
GRG experienced increased activity during the Quarter, achieving
sales of GBP1,175,000 (QTR1 FY2019: GBP805,000) resulting in a
small operating profit GBP23,000 (QTR1 FY2019: loss of
GBP203,000).
The current indications are that the next quarter's results
should improve further, however the sourcing of material to process
remains sporadic and the visibility of future consignments remains
low.
There are indications that we are penetrating the West African
market as planned and we remain optimistic that we will receive
support from the various Governments and the mines to expand our
market reach to source material in West Africa. We have more than a
decade of history in Ghana and we are optimistic that the Economic
Community of West African States (ECOWAS) countries will support
our Ghana operation, being a regional enterprise.
We are exploring the opportunities for toll treating lower grade
material from Artisanal sources in Ghana. This potential new
revenue stream will be subject to obtaining support from the
Minerals Commission of Ghana.
Kilimapesa Gold ('KPG')
The mine remains on care and maintenance; mining has ceased and
we are only incurring costs on security at the mining sites to
safeguard our assets.
To reduce the cash costs of care and maintenance and to support
the local community while we seek an investment partner, we are
processing batches of artisanal material, which we will continue to
do whilst it makes a cash contribution to the care and maintenance
costs.
Operating losses were GBP127,000 for the Quarter (QTR1 FY2019:
loss of GBP352,000). The operating loss for the quarter, excluding
depreciation of GBP69,000, was GBP58,000. In comparison the
estimated cost of care and maintenance would have been GBP150,000
for the Quarter, if we did not run the plant.
The majority of VAT refunds that have been received so far of
GBP345,000 has been applied to reduce debt.
Anumso Gold Corp ('Anumso')
We have agreed with our Joint Venture partner at Anumso, Desert
Gold (Ashanti Gold and Desert Gold merged towards the end of
September 2019), to seek a buyer for the Anumso gold project. We
have had initial early stage discussions of possible terms with
some interested parties.
For further information visit www.goldplat.com, follow on
Twitter @GoldPlatPlc or contact:
Werner Klingenberg Goldplat plc (CEO) Tel: +27 (0) 82 051
1071
Colin Aaronson / Richard Grant Thornton UK LLP (Nominated Tel: +44 (0) 20 7383
Tonthat / Ben AO Roberts Adviser) 5100
James Joyce / Jessica Cave WH Ireland Limited (Broker) Tel: +44 (0) 207
220 1666
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
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END
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