Interim Results

RNS Number : 9794A

Rockfire Resources PLC

28 September 2022

 

The information contained within this announcement is deemed by the Company to constitute inside information pursuant to Article 7 of EU Regulation 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended.

28 September 2022

Rockfire Resources plc

("Rockfire" or the "Company")

Interim Results

Rockfire Resources plc (LON: ROCK), the gold and base metal exploration company, is pleased to announce its unaudited interim results for the six months ended 30 June 2022.

Rockfire has continued its focus on a strategic campaign to attain value growth, primarily through explorationsuccess.ThisformsanintegralpartofthegrowthstrategyadoptedbytheBoardtoachieve increased asset value and thereby, shareholder wealth.

The Company's exploration activities have focused on its large-scale battery metal and critical metal Molaoi zinc-lead-silver-germanium deposit ("Molaoi") in Greece, at a time when European energy supply is being revised and zinc prices have materially increased. The Board believes the timing of higher zinc prices and exploration drilling at the Company's 100%-owned Molaoi Deposit within the strategic EU country of Greece are combining to Rockfire's advantage.

The loss attributable to the shareholders of the Company for the six months ended 30 June 2022 was

£302,582, a reduction of £123,355 from the comparable period to 30 June 2021. The primary reason for the reduction is that the prior period included a share-based payment expense of £116,049. There were no grants of options during this current period.

Rockfire project portfolio

Molaoi Zinc-Lead-Silver-Germanium Deposit, Peloponnese, Greece

Rockfire announced on 8 March 2022 that it had won the international tender for the high-grade Molaoi zinc-lead-silver deposit in Greece via the local Greek company of Hellenic Minerals IKE. Hellenic Minerals IKE was acquired by Rockfire Resources plc (as announced on the 16 May 2022). Some of the outstanding results from historical drilling at Molaoi include:

· 10.4 m @ 10.63 % Zn, 1.45% Pb, & 62 g/t Ag (AN011, from 79 m)

· 15.0 m @ 11.94 % Zn, 1.96% Pb, & 66 g/t Ag (AN017, from 136 m)

· 7.0 m @ 14.96 % Zn, 2.13% Pb, & 63 g/t Ag (AN028, from 187 m)

· 7.0 m @ 19.17 % Zn, 2.89% Pb, & 76 g/t Ag (B010, from 43 m)

· 9.9 m @ 18.06 % Zn, 2.87% Pb, & 91 g/t Ag (B011, from 184 m)

· 2.8 m @ 26.51 % Zn, 1.87% Pb, & 80 g/t Ag (BG013, from 57 m)

As part of our technical due diligence, the historical diamond drill core for Molaoi was located within the Greek Government storage facility (as announced on 3 May 2022). Select intervals were chosen for re-analysis using an independent geochemical laboratory (ALS). Samples were selected to verify a spread of original assays ranging from 0.9 % Zn to a maximum of 36.75 % Zn. Additionally, the samples represented a spatial spread to include a 1.5 km distance where most of the historical drilling has occurred. Re-analysis of historical diamond drill core has returned high-grade zinc, lead and silver values which closely replicate historical analyses.

On 10 May 2022, the Company announced the discovery of the critical metal germanium (Ge) at Molaoi during the re-analysis of the historical diamond drill core. The European Union Environmental Agency includes germanium in the top 20 raw materials which have been identified by the European Commission as being critical metals, owing to risk of supply shortages. The weighted average grade of the 51 samples collected during the re-analysis of core from Molaoi is 51 grams per tonne (g/t) Ge, with a peak value of 197 g/t Ge. 41% of samples returned germanium values above 50 g/t Ge. The germanium metal ingot price is currently US$ 1,330 per kilogram (USD$ 1.3M per tonne) which, if commercially recoverable in concentrate from Molaoi, would add material value to the overall financial metrics of the Molaoi deposit. Germanium is used in the manufacture of everyday technology including mobile phones, electronics, solar cells, camera lenses, satellites, computer screens, as well as steering and parking sensors for vehicles. Germanium is also used in numerous military applications, including weapons-sighters (scopes) and infrared night vision.

On 23 May 2022, the Company delivered a maiden JORC 2012 compliant inferred mineral resource of

2.3 million tonnes @ 11 % ZnEq. for 250,000 tonnes of ZnEq at Molaoi. This resource uses a 4% low- grade cut, with individual elemental grades of 9.4 % Zn, 1.7 % Pb and 47 g/t Ag. Molaoi currently contains 210,000 tonnes of zinc, 39,000 tonnes of lead, and 3.5 million ounces of silver. Only 1,400 m of a potential strike extent of 7 km has been included in the resource and the resource remains open at depth and along strike. Multiple, parallel mineralised lodes, which are not included in the resource, are yet to be fully tested. The images of the resource model, which can be viewed via the link below, demonstrate the quality of zinc intercepts in parallel lodes which may add materially to the resource in future estimates. Metallurgical flotation test work completed in 1984 resulted in 96% zinc recovery, 92% lead recovery and 91% silver recovery into a bulk concentrate. These recovery factors have been applied to the mineral resource to calculate the resulting zinc equivalent tonnes and grade. Mineralisation starts at surface. Despite this, and to ensure a practical estimate is delivered, the top 40 m has been excluded from the mineral resource. Rockfire is planning underground mining only to minimise social and environmental impacts. Germanium has not been included in the resource estimate owing to limited quantitative analysis.

Plateau

Soil sampling was completed at Plateau (announced 21 June 2022) in an undrilled area outside of the defined JORC 2012 mineral resource. The soil sampling returned a large gold anomaly which extends for over 200 m. This anomaly is located on the margin of the breccia/rhyolite intrusion complex and returned very high gold values with a maximum value of 0.67 g/t Au.

On 2 August 2022, Rockfire announced the results of rock samples which were collected in areas of geophysical and geochemical anomalism. 17 rock samples collected during June 2022 outlined two of the new exploration targets, with results including 10.7 g/t Au, 3.2 g/t Au and 2.3 g/t Au. 29% of the samples returned results above 0.5 g/t Au, with more than 80% of results being above 0.1 g/t Au.

Copperhead

As part of Rockfire's maiden drilling program at Copperhead, the results for drill hole BCH003 were announced on 20 January 2022. Hole BCH003 returned 370 m @ 0.20 % CuEq. from 57 m, with copper veins observed throughout the entire 429 m long drill hole. The drill hole finished in copper-bearing veins. Within this broad zone, a higher-grade interval of 50 m @ 0.35 % CuEq. occurs from 259 m downhole depth, and a more intensely veined interval of 22 m @ 0.41 % CuEq. has been intersected from 271 m downhole depth. Copper mineralisation has been significantly expanded 100 m directly east of hole BCH001 and 200 m north of hole BCH002, resulting in another significant increase in the footprint of the drilled copper-bearing area. Alteration and visible copper mineralisation in each hole continues to indicate that the Company's drilling is occurring in the upper, "phyllic" levels of a large porphyry copper system.

On 21 March 2022, Rockfire announced a maiden JORC 2012 compliant mineral resource of 64 million tonnes @ 0.19 % Cu EQ for 120,000 tonnes of Cu Eq. in the inferred category. The resource contains 80 Kt of Cu (@ 0.12%), 9.4 Kt of Mo (@0.015 %), and 1.1 Moz Ag (@0.55 g/t Ag). The mineral resource remains open to the north, east, west and at depth, leaving scope for significant, further resource increases. This resource comprises five diamond drill holes drilled by Rockfire, which were designed to validate historical drilling results and to attain a JORC resource. Both aims have been comprehensively accomplished. The extent and tenor of mineralisation at Copperhead have yet to be fully tested. Copper mineralisation starts at surface and continues for at least 400 m vertically below surface. With continued exploration success and expansion of the resource, Copperhead demonstrates potential to form a low-cost, bulk-tonnage, open cut mining scenario. The copper price remains robust with the continued strong demand for electric vehicles and green energy, including wind turbines and solar panels. Copperhead is situated approximately 250 km by road from Australia's largest copper smelter near Townsville.

Post-period end

On 24 August 2022, Rockfire announced that metallurgical test-work on the Molaoi historical core returned excellent recoveries of zinc (89% Zn) and lead (74% Pb). Additionally, commercially saleable grades of zinc (57% Zn), silver (856 g/t Ag), lead (63.6% Pb), germanium (117 g/t Ge), copper (2.62% Cu) and gold (0.52 g/t Au) are readily returned.

The flotation process was successfully able to separate two distinct concentrates, the first being a zinc- germanium concentrate with first-pass metallurgical recovery of zinc of 89%. This figure is likely to increase with more detailed tests. The Company's consultants, BHM Process Consultants Pty. Ltd., report the performance of the zinc system as "excellent" with a product grade of 57% Zn concentrate achieved in a single pass through a 3-stage flotation circuit. This is well above the desired product grade of 50% Zn contained for a saleable concentrate. Germanium reports to the zinc concentrate with a commercially competitive grade of 117 g/t Ge and is expected to be recovered as part of the zinc concentrate. This is expected to be a valuable credit in the concentrate. The second being a lead- silver-copper-gold concentrate.

First-pass metallurgical recovery of lead is 74%, with this figure also expected to increase with more detailed test work. The lead circuit recovery is at a greatly over-concentrated value of 63.6% Pb concentrate achieved in a single pass through a 3-stage circuit configuration. This also far exceeds the market requirement of 40% - 50% Pb contained for a saleable concentrate. Silver recovery is 85.6% from the rougher tails, with 15.2% of the silver reporting through to the lead concentrate at a grade of 856 g/t Ag. Copper and gold both reported to the lead concentrate with grades of 2.62% Cu and

0.52 g/t Au. Historical copper mines exist in the northern part of the Molaoi tenement, suggesting copper and gold is likely to add material value to future concentrates.

The metallurgical test-work company believes that these recovery figures may be conservative, as there is much metallurgical development and many optimisation tests still to occur on the project. A differential flotation system was tested, by which the first stage targets the recovery of lead, copper, and silver together into a single bulk sulphide concentrate, whilst sphalerite (zinc) is depressed. The second system targets the recovery of zinc (with germanium). The results available so far are for tests on composite samples from Molaoi core which have been blended to produce an "industry average" grade. The composite average feed grade used in the tests is 5.9% Zn and 1.6% Pb. Test work remains in progress on a much higher average grade composite sample of 18.9% Zn and 4.5% Pb, which Rockfire's management believes may be closer to the ultimate feed head grade, based on drilling at Molaoi. More definitive testing will be initiated using core obtained from the planned diamond drilling later in the year. This work will include crushing, milling and abrasion work indices.

Competent person statement

Information in this announcement that relates to exploration results is based on information compiled by Mr Edward Fry, the Exploration Manager of Rockfire Resources plc, who is a Member of the Australasian Institute of Mining and Metallurgy (MAusIMM). Mr Fry has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which has been undertaken to qualify as a Competent Person as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) and under the AIM Rules - Note for Mining and Oil & Gas Companies. Mr Fry consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears.

For further information on the Company, please visit www.rockfireresources.com or contact the following:

Rockfire Resources plc:	[e-mail]
David Price, Chief Executive Officer
Allenby Capital Limited (Nominated Adviser & Broker)	Tel: [phone]
John Depasquale / George Payne (Corporate Finance) Matt Butlin / Kelly Gardner (Sales and Corporate Broking)
Yellow Jersey PR	[e-mail]
Sarah Hollins / Henry Wilkinson	Tel: [phone]

Notes to Editors

Rockfire Resources plc (LON: ROCK) is a mineral exploration company with a portfolio of 100%-owned gold and copper projects in Queensland Australia and a high-grade zinc deposit in Greece.

§ The Molaoideposit in Greece has a JORC resource of 210,000 tonnes of zinc, 39,000 tonnes of lead and

3.5 million ounces of silver.

§ The Plateaudeposit in Queensland has a JORC resource of 208,000 ounces of gold and 1.5 million ounces of silver (0.2 g/t Au cut-off).

§ The Copperhead deposit in Queensland has a JORC resource of 80,000 tonnes of copper, 9,400 tonnes of molybdenum and 1.1 million ounces of silver.

ROCKFIRE RESOURCES PLC

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2022

		6 months to 30 June 2022	6 months to 30 June 2021	12 months to 31 December 2021
		£	£	£
	Note	(unaudited)	(unaudited)	(audited)
Impairment of intangible assets		-	-	(12,324)
Administrative expenses		(302,582)	(425,937)	(732,619)
Loss before taxation		(302,582)	(425,937)	(744,953)
Taxation		-	-	-
Loss attributable to shareholders of the Company		(302,582)	(425,937)	(744,953)
Items that may be subsequently reclassified to profit or loss:
Foreign exchange translation movement		86,249	(42,929)	(162,830)
Total comprehensive loss attributable to shareholders of the Company		(216,333)	(468,866)	(907,783)
Loss per share attributable to shareholders of the Company
Basic and diluted (pence)	4	(0.03)	(0.05)	(0.08)

ROCKFIRE RESOURCES PLC

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2022

		6 months to 30 June 2022	6 months to 30 June 2021	12 months to 31 December 2021
		£	£	£
	Note	(unaudited)	(unaudited)	(audited)
ASSETS
Non-current assets
Intangible assets		4,095,276	2,925,443	3,447,739
Property, plant and equipment		20,686	24,760	20,189
Total non-current assets		4,115,962	2,950,203	3,467,928
Current assets
Cash and cash equivalents		853,601	1,493,441	1,473,599
Trade and other receivables		57,957	27,110	124,261
Total current assets		911,558	1,520,551	1,597,860
Total assets		5,027,520	4,470,754	5,065,788
EQUITY AND LIABILITIES
Equity attributable to shareholders of the Company
Share capital	5	7,131,114	6,950,667	7,078,136
Share premium		18,191,679	17,337,252	18,180,659
Other reserves		2,295,035	2,295,035	2,295,035
Merger relief reserve		190,000	-	-
Foreign exchange reserve		(103,757)	(70,105)	(190,006)
Retained deficit		(22,711,002)	(22,089,406)	(22,408,420)
Total equity		4,993,069	4,423,443	4,955,404
Current liabilities
Trade and other payables		34,451	47,311	110,384
Total current liabilities		34,451	47,311	110,384
Total liabilities		34,451	47,311	110,384
Total equity and liabilities		5,027,520	4,470,754	5,065,788

ROCKFIRE RESOURCES PLC

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2022

	Share capital	Share premium	Other reserves	Merger relief reserve	Foreign exchange reserve	Accumulated losses	Total
	£	£	£	£	£	£	£
At 1 January 2021	6,828,085	16,658,354	2,295,035	-	(27,176)	(21,779,517)	3,974,781
Loss for the period	-	-	-	-	-	(425,937)	(425,937)
Foreign exchange translation movement	-	-	-	-	(42,929)	-	(42,929)
Total comprehensive loss	-	-	-	-	(42,929)	(425,937)	(468,866)
Issue of share capital	122,582	737,423	-	-	-	-	860,005
Cost of share Issue	-	(58,525)	-	-	-	-	(58,525)
Share based payments	-	-	-	-	-	116,048	116,048
Total transactions with shareholders	122,582	678,898	-	-	-	116,048	917,528
At 30 June 2021	6,950,667	17,337,252	2,295,035	-	70,105	(22,089,406)	4,423,443
Loss for the period	-	-	-	-	-	(319,014)	(319,017)
Foreign exchange translation movement	-	-	-	-	(260,111)	-	(260,111)
Total comprehensive loss	-	-	-	-	(260,111)	(319,014)	(260,111)
Issue of share capital	127,469	893,572	-	-	-	-	1,021,041
Cost of share issue	-	(50,165)	-	-	-	-	(50,165)
Total transactions with shareholders	127,469	843,407	-	-	-	(319,014)	651,862
At 31 December 2021	7,078,136	18,180,659	2,295,035	-	(190,006)	(22,408,420)	4,955,404
Loss for the period	-	-	-	-	-	(302,582)	(302,582)
Foreign exchange translation movement	-	-	-	-	86,249	-	86,249
Total comprehensive loss	-	-	-	-	86,249	(302,582)	(216,333)
Issue of share capital	2,978	11,020	-	-	-	-	13,998
Acquisition of subsidiary	50,000	-	-	190,000	-	-	240,000
Total transactions with shareholders	52,978	11,020	-	190,000	-	-	253,998
At 30 June 2022	7,131,114	18,191,679	2,295,035	190,000	(103,757)	(22,711,002)	4,993,069

ROCKFIRE RESOURCES PLC

UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2022

	6 months to 30 June 2022	6 months to 30 June 2021	12 months to 31 December 2021
	£	£	£
	(unaudited)	(unaudited)	(audited)
Cash flow from operating activities
Loss for the period	(302,582)	(425,937)	(744,953)
- Impairment of intangible assets	-	-	12,334
- Share-based payments	-	116,048	116,049
- Expenses settled in shares	14,000	10,000	-
- Depreciation	2,614	3,312	7,052
- Foreign exchange rate changes	83,137	(20,311)	(47,913)
	(202,831)	(316,888)	(657,431)
Decrease/ (increase) in trade and other receivables	83,374	12,058	(61,748)
(Decrease) in trade and other payables	(81,352)	(48,153)	(9,147)
Net cash flow used in operating activities	(200,809)	(352,983)	(728,326)
Cash flow from investing activities
Exploration expenditure	(501,471)	(293,276)	(918,667)
Acquisition of property, plant and equipment	-	(2,705)	(2,690)
Cash acquired from acquisition of subsidiary	82,282	-	-
Net cash used in investing activities	(419,189)	(295,981)	(921,357)
Cash flow from financing activities
Proceeds from issuance of ordinary shares	-	850,004	1,881,046
Share issue costs	-	(58,525)	(108,690)
Net cash generated by financing activities	-	791,479	1,772,356
Net (decrease)/ increase in cash and cash equivalents	(619,998)	142,515	122,673
Cash and cash equivalents at the beginning of the period	1,473,599	1,350,926	1,350,926
Cash and cash equivalents at the end of the period	853,601	1,493,441	1,473,599

ROCKFIRE RESOURCES PLC

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2022

1  Principal activities

The Company is a public limited company, admitted to trading on AIM and incorporated and domiciled in England and Wales.

On 8 March 2022, Rockfire announced the winning of an Open International Tender for a 30-year licence to explore and mine the high-grade Molaoi Zn/Pb/Ag deposit, located in the Hellenic Republic of Greece. Therefore, the Group's principal activities are now exploration for gold and base metals in Molaoi, Greece and Queensland, Australia.

2  Basis of preparation

The unaudited consolidated financial statements are for the six-month period ended 30 June 2022. They do not include all the information required for full annual financial statements and should be read in conjunction with the audited consolidated financial statements of the Group for the year ended 31 December 2021.

The financial statements are prepared on the historical cost basis or the fair value basis where the fair valuing of relevant assets and liabilities has been applied.

The financial statements have been prepared in accordance with accounting policies consistent with those set

out in the Group's financial statements for the year ended 31 December 2021.

The financial statements incorporate the financial statements of the Company and subsidiaries controlled by the Company as at 30 June 2022.

The financial information set out in this interim report does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2021 have been filed with the Registrar of Companies. Those financial statements received an unqualified audit report and did not contain statements or matters to which the auditors drew attention under the Act.

The Group's consolidated financial statements are presented in GB pounds sterling ("£" or "GBP") which is also the functional currency.

3  Critical accounting estimates and judgements

In the application of the Group's accounting policies, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of certain assets and liabilities. The Directors have identified the following critical judgements and estimates in applying the Group's accounting policies that have the most significant impact on the amounts recognised in this Interim Report.

Asset acquisition

In the acquisition of Hellenic, the Directors have determined that the business does not meet the definition of a business as outlined in IFRS 3. As such the Directors have elected to adopt the policy choice not to recognise contingent consideration with respect to an asset acquisition until such time as the related activity that gives rise to the liability occurs.

4  Loss per share

Basic and diluted loss per share

The calculation of basic and diluted loss per share is based on the loss attributable to ordinary shareholders of

£302,582 (2021: £425,937) and a weighted average number of ordinary shares in issue of 1,096,066,785 (30 June 2021: 833,273,833).

5  Share capital

	30 June 2022	30 June 2021	31 December 2021
Issued share capital	Number	Number	Number
Ordinary shares of £0.001 each	1,135,444,195	954,997,653	1,082,466,125
Deferred shares of £0.099 each	51,215,534	51,215,534	51,215,534
	30 June 2022	30 June 2021	31 December 2021
Issued share capital	£	£	£
Fully paid	7,131,114	6,950,667	7,078,136
	7,131,114	6,950,667	7,078,136

Fully paid ordinary shares carry one vote per share and carry the right to dividends. There are no shares held by the Company or its subsidiaries.

The deferred shares carry no voting or income rights. The only right attaching to deferred shares is to receive the amount paid up on a winding up of the Company once the holders of ordinary shares have received

£1,000,000 per ordinary share.

On 18 March 2022, the Company issued 1,228,070 new ordinary shares to Patrick Elliott in settlement of

Director's fees.

On 13 May 2022, the Company issued 1,750,000 new ordinary shares to Patrick Elliott in settlement of Director's

fees.

On 16 May 2022, the Company issued 50,000,000 new ordinary shares to the vendors of Hellenic Minerals as settlement of Tranche 1 of the acquisition agreement for the Molaoi project in Greece. David Price (or his related party nominees) was issued 25,000,000 of these new ordinary shares in the Company as per the historic agreement which is outlined in the Strategic Report of the Group's financial statements for the year ended 31 December 2021.

The nominal value of the issued share capital includes a cumulative foreign exchange difference of £925,331

which was recognised in 2017 when the Group's functional currency was changed from US$ to GBP.

6  Asset acquisition

On 8 March 2022, Rockfire announced the winning of an Open International Tender for a 30-year licence to explore and mine the high-grade Molaoi Zn/Pb/Ag deposit, located in the Hellenic Republic of Greece. Rockfire participated in the tender under a Memorandum of Understanding with a local Greek company, Hellenic Minerals IKE ("Hellenic"), the applicant in the tender. Subsequently, Rockfire acquired 100% of the shares in Hellenic.

On 16 May 2022, the Company acquired 100% share capital purchase in Hellenic Minerals IKE. Consideration was paid by the Company issuing 50,000,000 new ordinary shares to the vendors of Hellenic Minerals at an issue price of 0.01p and potential deferred consideration of £400,000 in respect of obtaining a JORC- compliant mineral resource exceeding four hundred thousand tonnes of zinc equivalent value. The principal reason for the acquisition is that Molaoi is an outstanding high-grade zinc deposit, and the addition of the project strategically complements Rockfire's existing portfolio of precious and base metal assets. The following table summarises the net liabilities acquired, and assumed at the acquisition date:

	Fair value £'s
Trade and other receivables	17,070
Cash and cash equivalents	82,282
Trade and other payables	(131,735)
Net liabilities acquired	(32,383)
Consideration	362,147
Fair value attributable to exploration assets	394,530

7  Post balance sheet events

There have been no material post balance sheet events that would require disclosure or adjustment to these interim financial statements.

8  Availability of interim results

A copy of the half-yearly results can be viewed on the Company's website at: www.rockfireresources.com

 

END

 

 

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