Serabi Gold plc press release
Unaudited interim results for the three-and nine-month periods ended 30 September 2024
LSE - London Stock Exchange · Gold · Copper · Lead · Silver · Zinc · United Kingdom
Serabi (AIM:SRB, TSX:SBI, OTCQX:SRBIF), the Brazilian focused gold mining and development company, is pleased to release its unaudited interim results for the three and nine-month periods ended 30 September 2024.
A copy of the full interim statements together with commentary can be accessed on the Company’s website using the following link: - https://bit.ly/3Z8CJiX
“This has been another excellent quarter for Serabi, in particular for cash generation, said Clive Line, Serabi’s CFO. “The cash balance at the end of September was $20.0 million with $8.0 million generated during the quarter. EBITDA of $11.7 million for the quarter brings EBITDA for the year to date to a total of $24.7 million, a 42 per cent improvement compared with the second quarter.
"We benefited from inventory realisation to the sum of approximately $3.0M, boosting quarter sales, and whilst I do not expect similar additional inventory sales for Q4, I do anticipate cash growth to continue to the end of the year notwithstanding the cyclical effects of tax payments and 13 th salary accruals that are due. The ability of the business to produce healthy cash flow is being further supported by the Coringa classification plant which is now operational and in the final stages of commissioning. We are already passing run of mine ore through this plant and will also start to work our way through the lower grade stockpiles that have been accumulated at Coringa. As a result of processing this stockpiled material we hope that this final quarter will continue the pattern of increasing production quarter on quarter that we have so far experienced in 2024.
"During the quarter we announced the results of the Preliminary Economic Assessment for Coringa which indicate an average project AISC of $1,241 over the project life from 1 January 2025 onwards. The full NI 43-101 compliant Technical Report was published on 21 November 2024."
Financial Highlights (all currency amounts are expressed in US Dollars unless otherwise stated)
Gold production for the first nine months of 2024 of 27,499 ounces (2023: 25,262 ounces). Cash held on 30 September 2024 of $20.0 million (31 December 2023: $11.6 million including US$0.6 million relating to the exploration alliance with Vale). EBITDA for the nine-month period of $24.7 million (2023: $8.8 million). Post-tax profit for the nine-month period of $17.8 million (2023: $4.6 million), Profit per share of 23.55 cents compared with a profit per share of 6.10 cents for the same nine month period of 2023. Net cash inflow from operations for the nine-month period (after mine development expenditure of US$4.9 million) of US$18.2 million (2023: US$10.7 million inflow, after mine development expenditure of US$2.6 million). Average gold price of US$2,338 per ounce received on gold sales during the nine month period (2023: US$1,940). Cash Cost for the nine month period to 30 September 2024 of US$1,405 per ounce (nine months 2023: US$1,253 per ounce). All-In Sustaining Cost for the nine-month period to 30 September 2024 of US$1,790 per ounce (nine months 2023: US$1,553 per ounce).
Overview of the financial results
In the first nine months of 2024, the Group has reported revenue and operating costs related to the sale of 28,912 ounces in the period (27,499 ounces produced). This compares to sales reported of only 23,733 ounces in the first nine months of 2023. Reported revenues and costs reflect the ounces sold in each period and as a result total costs for the nine-month period are significantly higher than for the corresponding period of 2023.
During the month of January 2024, the Group also completed and drew down a new US$5 million loan with Itaú Bank in Brazil. This new arrangement has an interest coupon of 8.47 per cent and is repayable as a bullet payment on 6 January 2025. This replaced a similar loan arranged with Santander Bank in Brazil that was repaid during the month of February 2024.
Final commissioning of the ore sorter and crushing plant for Coringa is almost complete, with the crushing plant operational during October and the ore-sorter starting up during November. During the remainder of the fourth quarter in addition to passing run of mine ore extracted from Coringa, the Company will also be processing some of the lower grade material that has been stockpiled at Coringa providing an additional boost to gold production in the remainder of the fourth quarter.
Key Financial Information
| SUMMARY FINANCIAL STATISTICS FOR THE THREE-AND NINE MONTHS ENDING 30 SEPTEMBER 2024 | | | | | | | | | 9 months to 30 September 2024 US$ (unaudited) | 9 months to 30 September 2023 US$ (unaudited) | 3 months to 30 September 2024 US$ (unaudited) | 3 months to 30 September 2023 US$ (unaudited) | | | | Revenue | 70,290,641 | 47,897,264 | 27,626,034 | 17,373,682 | | | | Cost of sales | (39,840,803) | (34,405,882) | (14,160,734) | (13,341,448) | | | | Gross operating profit | 30,449,838 | 13,491,382 | 13,465,300 | 4,032,234 | | | | Administration and share based payments | (5,728,359) | (4,702,467) | (1,719,359) | (1,864,200) | | | | EBITDA | 24,721,479 | 8,788,915 | 11,745,941 | 2,168,034 | | | | Depreciation and amortisation charges | (3,297,323) | (3,409,994) | (1,056,517) | (1,384,957) | | | | Operating profit before finance and tax | 21,424,156 | 5,378,921 | 10,689,424 | 783,077 | | | | | | | | | | | | Profit after tax | 17,837,221 | 4,620,779 | 8,615,387 | (359,112) | | | | Earnings per ordinary share (basic) | 23.55c | 6.10c | 11.38c | 0.47c | | | | | | | | | | | | Average gold price received (US$/oz) | US$2,338 | US$1,940 | US$2,478 | US$1,930 | | |
| | | | As at 30 September 2024 US$ (unaudited) | As at 31 December 2023 US$ (audited) | | Cash and cash equivalents | | | 20,029,407 | 11,552,031 | | Net funds (after finance debt obligations) | | | 14,007,367 | 5,148,947 | | Net assets | | | 103,439,147 | 92,792,049 | | | | | | |
| Cash Cost and All-In Sustaining Cost (“AISC”) | | | | | | | | 9 months to 30 September 2024 | 9 months to 30 September 2023 | 12 months to 31 December 2023 | | Gold production for cash cost and AISC purposes | | 27,499 ozs | 25,262 ozs | 33,152 ozs | | | | | | | | Total Cash Cost of production (per ounce) | | US$1,405 | US$1,253 | US$1,300 | | Total AISC of production (per ounce) | | US$1,790 | US$1,553 | US$1,635 |
Engage Investor Presentation – 3 December 2024
Shareholders and investors are advised that Mike Hodgson, Chief Executive Officer of the Company will provide a live interactive presentation via the Engage Investor platform, on the 3rd of December at 2:30pm GMT.
Serabi Gold plc welcomes all current shareholders and interested investors to join and encourages investors to pre-submit questions. Investors can also submit questions at any time during the live presentation.
Investors can sign up to Engage Investor at no cost and follow Serabi Gold plc from their personalised investor hub.
Shareholders and investors can register interest in this event using the following link - https://engageinvestor.news/SRB_Ei
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.
The person who arranged for the release of this announcement on behalf of the Company was Clive Line, Director.
Enquiries
SERABI GOLD plc Michael Hodgson t + 44 (0)20 7246 6830 Chief Executive m +44 (0)7799 473621
Clive Line t + 44 (0)20 7246 6830 Finance Director m +44 (0)7710 151692
Andrew Khov m +1 647 885 4874 Vice President, Investor Relations & Business Development e contact@serabigold.com
www.serabigold.com
BEAUMONT CORNISH Limited Nominated Adviser & Financial Adviser Roland Cornish / Michael Cornish t +44 (0)20 7628 3396
PEEL HUNT LLP Joint UK Broker Ross Allister t +44 (0)20 7418 9000
TAMESIS PARTNERS LLP Joint UK Broker Charlie Bendon/ Richard Greenfield t +44 (0)20 3882 2868
CAMARCO Financial PR - Europe Gordon Poole / Emily Hall t +44 (0)20 3757 4980
HARBOR ACCESS Financial PR – North America Jonathan Patterson / Lisa Micali t +1 475 477 9404
Copies of this announcement are available from the Company's website at www.serabigold.com .
Forward-looking statements Certain statements in this announcement are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ‘‘believe’’, ‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘will’’ or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.
Qualified Persons Statement The scientific and technical information contained within this announcement has been reviewed and approved by Michael Hodgson, a Director of the Company. Mr Hodgson is an Economic Geologist by training with over 35 years' experience in the mining industry. He holds a BSc (Hons) Geology, University of London, a MSc Mining Geology, University of Leicester and is a Fellow of the Institute of Materials, Minerals and Mining and a Chartered Engineer of the Engineering Council of UK, recognizing him as both a Qualified Person for the purposes of Canadian National Instrument 43-101 and by the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009.
Notice Beaumont Cornish Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as nominated adviser to the Company in relation to the matters referred herein. Beaumont Cornish Limited is acting exclusively for the Company and for no one else in relation to the matters described in this announcement and is not advising any other person and accordingly will not be responsible to anyone other than the Company for providing the protections afforded to clients of Beaumont Cornish Limited, or for providing advice in relation to the contents of this announcement or any matter referred to in it.
Neither the Toronto Stock Exchange, nor any other securities regulatory authority, has approved or disapproved of the contents of this news release.
See www.serabigold.com for more information and follow us on twitter @Serabi_Gold
The following information, comprising, the Income Statement, the Group Balance Sheet, Group Statement of Changes in Shareholders’ Equity, and Group Cash Flow, is extracted from the unaudited interim financial statements for the three and nine months to 30 September 2024.
Statement of Comprehensive Income For the three and nine-month periods ended 30 September 2024.
| | | For the three months ended 30 September | For the nine months ended 30 September | | | | | | 2024 | 2023 | 2024 | 2023 | | (expressed in US$) | Notes | (unaudited) | (unaudited) | (unaudited) | (unaudited) | | CONTINUING OPERATIONS | | | | | | | Revenue | | 27,626,034 | 17,373,682 | 70,290,641 | 47,897,264 | | Cost of sales | | (14,160,734) | (11,769,256) | (39,840,803) | (32,463,690) | | Stock impairment provision | | — | — | — | (370,000) | | Depreciation and amortisation charges | 2 | (1,056,517) | (2,957,149) | (3,297,323) | (4,982,186) | | Total cost of sales | | (15,217,251) | (14,726,405) | (43,138,126) | (37,815,876) | | Gross profit | | 12,408,783 | 2,647,277 | 27,152,515 | 10,081,388 | | Administration expenses | | (1,679,357) | (1,934,235) | (5,484,788) | (4,834,129) | | Share-based payments | | (65,010) | (52,151) | (183,902) | (138,017) | | Gain on disposal of assets | | 25,008 | 122,186 | (59,669) | 269,679 | | Operating profit | | 10,689,424 | 783,077 | 21,424,156 | 5,378,921 | | Other income – exploration receipts | 3 | | 1,992,344 | 351,186 | 3,042,879 | | Other expenses – exploration expenses | 3 | | (1,856,520) | (317,746) | (2,876,431) | | Foreign exchange gain/(loss) | | 129,429 | (43,421) | (690,927) | 56,645 | | Finance expense | 4 | (127,729) | (381,478) | (438,032) | (500,588) | | Finance income | 4 | 109,262 | 199,792 | 345,727 | 703,823 | | Profit/(loss) before taxation | | 10,800,386 | 693,794 | 20,674,364 | 5,805,249 | | Income tax expense | 5 | (2,184,999) | (1,052,906) | (2,837,143) | (1,184,470) | | Profit/(loss) after taxation | | 8,615,387 | (359,112) | 17,837,221 | 4,620,779 | | | | | | | | | Other comprehensive income (net of tax) | | | | | | | | | | | | | | Exchange differences on translating foreign operations | | 808,689 | (2,952,047) | (7,374,025) | 1,751,104 | | Total comprehensive profit/(loss) for the period (1) | | 9,424,076 | (3,311,159) | 10,463,196 | 6,371,883 | | | | | | | | | Profit/(loss) per ordinary share (basic) | 6 | 11.38c | (0.47c) | 23.55c | 6.10c | | Profit/(loss) per ordinary share (diluted) | 6 | 11.38c | (0.47c) | 23.55c | 6.10c |
(1) The Group has no non-controlling interest and all profits are attributable to the equity holders of the Parent Company
Balance Sheet as at 30 September 2024
| (expressed in US$) | | | As at 30 September 2024 (unaudited) | As at 30 September 2023 (unaudited) | As at 31 December 2023 (audited) | | Non-current assets | | | | | | | Deferred exploration costs | | | 20,211,858 | 19,775,603 | 20,499,257 | | Property, plant and equipment | | | 56,310,566 | 49,107,705 | 53,340,903 | | Right of use assets | | | 4,928,263 | 5,214,315 | 5,316,330 | | Deferred taxes | | | 7,110,445 | 1,520,710 | 4,653,063 | | Taxes receivable | | | 1,903,307 | 3,891,201 | 1,791,983 | | Total non-current assets | | | 90,464,439 | 79,509,534 | 85,601,536 | | Current assets | | | | | | | Inventories | | | 12,338,958 | 9,819,171 | 12,797,951 | | Trade and other receivables | | | 2,100,956 | 1,579,886 | 2,858,072 | | Derivative financial assets | | | — | 197,864 | 115,840 | | Prepayments and accrued income | | | 1,633,602 | 1,750,470 | 2,320,256 | | Cash and cash equivalents | | | 20,029,407 | 15,352,099 | 11,552,031 | | Total current assets | | | 36,102,923 | 28,699,490 | 29,644,150 | | Current liabilities | | | | | | | Trade and other payables | | | 10,672,705 | 7,798,873 | 8,626,292 | | Interest bearing liabilities | | | 5,886,714 | 6,211,791 | 6,403,084 | | Accruals | | | 431,716 | 593,435 | 649,225 | | Total current liabilities | | | 16,991,135 | 14,604,099 | 15,678,601 | | Net current assets | | | 19,111,788 | 14,095,391 | 13,965,549 | | Total assets less current liabilities | | | 109,576,227 | 93,604,925 | 99,567,085 | | Non-current liabilities | | | | | | | Trade and other payables | | | 3,676,181 | 3,884,102 | 3,960,920 | | Interest bearing liabilities | | | 135,326 | 304,262 | 150,224 | | Deferred tax liability | | | — | 130,967 | — | | Provisions | | | 2,325,573 | 1,252,631 | 2,663,892 | | Total non-current liabilities | | | 6,137,080 | 5,571,962 | 6,775,036 | | Net assets | | | 103,439,147 | 88,032,963 | 92,792,049 | | Equity | | | | | | | Share capital | | | 11,213,618 | 11,213,618 | 11,213,618 | | Share premium reserve | | | 36,158,068 | 36,158,068 | 36,158,068 | | Option reserve | | | 359,475 | 116,246 | 175,573 | | Other reserves | | | 17,609,380 | 16,167,780 | 15,960,006 | | Translation reserve | | | (69,154,766) | (64,525,667) | (61,780,741) | | Retained surplus | | | 107,253,372 | 88,902,918 | 91,065,525 | | Equity shareholders’ funds | | | 103,439,147 | 88,032,963 | 92,792,049 |
Statements of Changes in Shareholders’ Equity For the nine-month period ended 30 September 2024
| (expressed in US$) | | | | | | | | | (unaudited) | Share capital | Share premium | Share option reserve | Other reserves (1) | Translation reserve | Retained Earnings | Total equity | | Equity shareholders’ funds at 31 December 2022 | 11,213,618 | 36,158,068 | 1,324,558 | 14,459,255 | (66,276,771) | 84,644,335 | 81,523,063 | | Foreign currency adjustments | — | — | — | — | 1,751,104 | — | 1,751,104 | | Profit for the period | — | — | — | — | — | 4,620,779 | 4,620,779 | | Total comprehensive income for the period | — | — | — | — | 1,751,104 | 4,620,779 | 6,371,883 | | Transfer to taxation reserve | — | — | — | 1,708,525 | — | (1,708,525) | — | | Share Options Expired | — | — | (1,346,329) | — | — | 1,346,329 | — | | Share incentives expense | — | — | 138,017 | — | — | — | 138,017 | | Equity shareholders’ funds at 30 September 2023 | 11,213,618 | 36,158,068 | 116,246 | 16,167,780 | (64,525,667) | 88,902,918 | 88,032,963 | | Foreign currency adjustments | — | — | — | — | 2,744,926 | — | 2,744,926 | | Profit for the period | — | — | — | — | — | 1,954,833 | 1,954,833 | | Total comprehensive income for the period | — | — | — | — | 2,744,926 | 1,954,833 | 4,699,759 | | Transfer to taxation reserve | — | — | — | (207,774) | — | 207,774 | — | | Share Options Expired | — | — | — | — | — | — | — | | Share incentives expense | — | — | 59,327 | — | — | — | 59,327 | | Equity shareholders’ funds at 31 December 2023 | 11,213,618 | 36,158,068 | 175,573 | 15,960,006 | (61,780,741) | 91,065,525 | 92,792,049 | | Foreign currency adjustments | — | — | — | — | (7,374,025) | — | (7,374,025) | | Profit for the period | — | — | — | — | — | 17,837,221 | 17,837,221 | | Total comprehensive income for the period | — | — | — | — | (7,374,025) | 17,837,221 | 10,463,196 | | Transfer to taxation reserve | — | — | — | 1,649,374 | — | (1,649,374) | — | | Share incentives expense | — | — | 183,902 | — | — | — | 183,902 | | Equity shareholders’ funds at 30 September 2024 | 11,213,618 | 36,158,068 | 359,475 | 17,609,380 | (69,154,766) | 107,253,372 | 103,439,147 |
(1) Other reserves comprise a merger reserve of US$361,461 and a taxation reserve of US$17,247,919 (31 December 2023: merger reserve of US$361,461 and a taxation reserve of US$15,598,545).
Condensed Consolidated Cash Flow Statement For the three and nine-month periods ended 30 September 2024
| | For the three months ended 30 September | For the nine months ended 30 September | | | | | | 2024 | 2023 | 2024 | 2023 | | | (expressed in US$) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | | | | | | | | | | Post tax profit/(loss) for period | 8,615,387 | (359,112) | 17,837,221 | 4,620,779 | | | Depreciation – plant, equipment and mining properties | 1,056,517 | 2,957,149 | 3,297,323 | 4,982,186 | | | Provision for inventory impairment | — | — | — | 370,000 | | | Gain on asset disposals | (25,008) | (122,186) | 59,669 | (269,679) | | | Net financial expense | (110,962) | 225,107 | 749,792 | (259,880) | | | Provision for taxation | 2,184,999 | 1,052,906 | 2,837,143 | 1,184,470 | | | Share-based payments | 65,010 | 52,151 | 183,902 | 138,017 | | | Taxation paid | (347,589) | (415,722) | (789,287) | (811,612) | | | Interest paid | (10,091) | (22,900) | (39,599) | (408,714) | | | Foreign exchange (loss) / gain | (291,702) | (45,098) | (343,986) | (117,170) | | | Changes in working capital | | | | | | | | Decrease/(increase) in inventories | 217,474 | (696,001) | (1,049,888) | (696,782) | | | Decrease/(increase)/decrease in receivables, prepayments and accrued income | 1,238,492 | (1,477) | (1,002,244) | 2,763,565 | | | Increase/(decrease) in payables, accruals and provisions | 979,209 | 1,550,835 | 1,384,012 | 1,798,796 | | Net cash inflow from operations | 13,571,736 | 4,175,652 | 23,124,058 | 13,293,976 | | | | | | | | | | Investing activities | | | | | | | Purchase of property, plant and equipment and assets in construction | (2,219,242) | (706,419) | (6,231,132) | (1,686,505) | | | Mine development expenditure | (1,977,182) | (1,274,305) | (4,913,351) | (2,613,395) | | | Geological exploration expenditure | (922,400) | (101,611) | (1,835,856) | (459,035) | | | Pre-operational project costs | (393,044) | — | (865,728) | — | | | Proceeds from sale of assets | 21,474 | 123,408 | 73,955 | 314,923 | | | Interest received | 109,262 | 101,574 | 338,895 | 181,373 | | | Net cash outflow on investing activities | (5,381,132) | (1,857,353) | (13,433,217) | (4,262,639) | | | | | | | | | | Financing activities | | | | | | | Receipt of short-term loan | — | — | 5,000,000 | 5,000,000 | | | Repayment of short-term loan | — | — | (5,000,000) | (5,096,397) | | | Payment of finance lease liabilities | (210,366) | (295,583) | (708,816) | (906,565) | | | Net cash (outflow) / inflow from financing activities | (210,366) | (295,583) | (708,816) | (1,002,962) | | | | | | | | | | Net increase / (decrease) in cash and cash equivalents | 7,980,238 | 2,022,716 | 8,982,025 | 8,028,375 | | | Cash and cash equivalents at beginning of period | 12,041,017 | 13,285,447 | 11,552,031 | 7,196,313 | | | Exchange difference on cash | 8,152 | 43,936 | (504,649) | 127,411 | | | Cash and cash equivalents at end of period | 20,029,407 | 15,352,099 | 20,029,407 | 15,352,099 | |