3rd Quarter Operating Results update

Goldplat plc

13 May 2024

 

Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining & Exploration

13 May 2024

Goldplat plc

('Goldplat' or the 'Company')

3^rd Quarter Operating Results update for period ended 31 March 2024

Goldplat Plc, (AIM:GDP) the AIM listed Mining Services Group, with international gold recovery operations located in South Africa and Ghana, servicing the African and South American Mining Industry, is pleased to announce an operational update for the 3^rd quarter ended 31 March 2024 ("Q3"), of the current financial year.

The two recovery operations achieved a combined operating profit for the quarter of £1,618,000 (excluding listing and head office costs and foreign exchange losses) which represents a 10% increase against Q3 in the previous period (Q3 2023 - £1,470,000).

During Q3 the two recovery operations achieved a combined profit before tax of £890,000 (Q3 2023 - £1,735,000) after they incurred £430,000 in interest costs (Q3 2023 - £74,000) and £350,000 in foreign exchange losses (Q3 2023 - foreign exchange gain £292,000) which mainly related to trading activities.

Ghana experienced an exceptional Q3, achieving an operating profit of £1,499,000 (Q3 2023 - £295,000), driven by strong supplies in Ghana and South America.

South Africa's Q3 performance continues to be impacted by a reduction in supply from current mining operations and to a lesser extent, by electricity cuts. South Africa achieved an operating profit of £119,000 (Q3 2023 - £1,175,000).

The combined operating profit for the operating entities for 9 months ended 31 March 2024 increased by 4% to £5,030,000 compared with the previous period (9 months ended 2023 - £4,840,000).

The following events have contributed to the Q3 operating results:

Gold Recovery Ghana ("GRG")

·      During Q3 GRG performed significantly better than previous quarters. As indicated above, Ghana received the benefit during Q3 from good supply of material during H1, with consignments treated from Ghana, Côte d'Ivoire and South America.    

·      In Q3 we started producing gold from the lower grade milling, gravity and flotation circuit which will assist in extracting value from large volumes of lower grade fine carbon material received in Ghana.

·      Some of the West African countries still have an embargo on the export of gold concentrates not in a dore or bullion form.

Goldplat Recovery (Pty) Ltd

·      We continue to see a reduction in by-products received from current mining operations due to changes in their production profile. The focus therefore remains to increase our by-product market share in South Africa and to gain access to neighbouring countries.

·      The impact of electricity cuts and infrastructure related issues continues to reduce with only 6% of the total days available in the quarter lost, compared with the circa 7% in Q2 2024 and 23% lost in the 3 quarters before that. The generator project was implemented and commissioned by the end of April and fully ready to mitigate any power interruptions in the future.

·      With lower recoveries from low grade soils (referring to gravity concentrates), reduction in by-products received and increases in cost, the various cost elements in South Africa will be reviewed and revised in the short term to conserve cash.

·      During the quarter, total capital of £490,000 was spent on the TSF, generators and other equipment. The acquisition of the generators to the value of £750,000 will be capitalised in Q4.

·      We estimate that we will require a further £450,000 to be spent on repairing and maintaining current operations and improving the environmental impacts of our current operations. The Company anticipates that this will be funded from internally generated cashflow.

·      With the new TSF having been commissioned, we are focussing on the work required to begin the processing of our old TSF which has a JORC Resource (January 2016) of 81,959 ounces in 1.43m metric tonnes (Table 1), at a DRD Gold processing facility. Since the completion of the JORC resource, circa 800,000t of material has been added to the facility at grades of circa 1.45g/t (subject to confirmation). We plan to update the JORC resource as the remaining requirements for processing of the old TSF becomes clear and will make further announcements in due course.

·      The processing of the old TSF remains dependent on:

o  The approval of the water use license over certain areas for the installation of a pipeline to the DRD Gold processing facility;

o  The application process was subject to completion of engineering designs which were finalised in December 2023. However, areas were identified where the pipeline route will require to be changed from the current servitude. These changes have resulted in changes to the timelines. We will keep the market updated once we have clarity of what the new timelines will be;

These changes may affect the way we process the TSF and the returns we expect to generate. DRD Gold and Goldplat Recovery are currently in the process of evaluating the different variables that will impact the processing of the TSF as well as the commercial impact thereof. This process will remain subject, inter alia, to the finalisation of the water use license.

Cash balances and availability

Our cash balances in the group increased from Q2, with increased sales in Ghana, and remains strong at GBP2,430,000 (GBP1,707,000 Q2 2024). The cash balances will mainly be used to reduce the requirement for trade finance in the medium-term, repayment of intercompany loan balances, repayment of debt and normal working capital and capital requirements.    

Werner Klingenberg, CEO of Goldplat commented: "The Group continues to benefit from engagements and marketing efforts over the last five years and we aim to build on the momentum into West Africa and South America, although the regulations governing the export of gold bearing by-products out of certain regions remain a challenge.

The requirements and approval of the water use license for installation of pipeline to DRD Gold remain a major focus for the Group, whilst we continue to strengthen our relationships, review various cost elements, and increase market share in a declining gold market in South Africa."

For further information visit www.goldplat.com, follow on Twitter @GoldPlatGDP or contact:

Werner Klingenberg	Goldplat plc (CEO)	Tel: [phone]
Colin Aaronson / Samantha Harrison	Grant Thornton UK LLP (Nominated Adviser)	Tel: [phone]
James Bavister / Andrew de Andrade	WH Ireland Limited (Broker)	Tel: [phone]
Tim Thompson / Mark Edwards / Fergus Mellon	Flagstaff Strategic and Investor Communications	Tel: [phone] [e-mail]

Table 1

Mineral Resource Estimate of the TSF, South Africa:

Total Resource
Domain	Class	Tonnes (Mil)	Density	Au (g/t)	Au (Oz)	U3O8 (g/t)	U3O8 (lbs)	Ag (g/t)	Ag (Oz)
TOTAL RESOURCE	Measured	0.87	1.32	1.82	50,907	61.41	117,754	4.85	135,573
	Indicated	0.49	1.37	1.77	27,897	59.73	64,506	4.71	74,165
	Inferred	0.07	1.30	1.4	3,154	71.40	11,016	2.82	6,356
Grand Total		1.43	1.34	1.78	81,959	61.32	193,276	4.70	216,094

 100% attributable to the Company.

The Tailings Mineral Resource Estimate was announced in accordance with the JORC Code (2012) in a press release on 29 January 2016. Mark Austin of Applied Geology & Mining (Pty) Ltd was the Competent Person responsible for that announcement. The Company confirms that all material assumptions and technical parameters underpinning the Resource Estimate continue to apply and have not materially changed, and it is not aware of any new information or data that materially affects the estimates.

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

END