Last checked at 30 Oct 2020 07:49
Rule 5.5
Appendix 5B
Mining exploration entity or oil and gas exploration entityquarterly cash flow report
Name of entity | ||
European Metals Holding Limited (ASX: EMH) | ||
ABN |
| Quarter ended ("current quarter") |
55 154 618 989 | 30 September 2020 | |
Consolidated statement of cash flows | Current quarter$A'000 | Year to date (3 months)$A'000 | |
1. | Cash flows from operating activities | 278 | 278 |
1.1 | Receipts from associate | ||
1.2 | Payments for | - | - |
(a) exploration & evaluation | |||
(b) development | - | - | |
(c) production | - | - | |
(d) staff costs | (86) | (86) | |
(e) administration and corporate costs | (560) | (560) | |
1.3 | Dividends received (see note 3) | - | - |
1.4 | Interest received | - | - |
1.5 | Interest and other costs of finance paid | - | - |
1.6 | Income taxes paid | - | - |
1.7 | Government grants and tax incentives | 43 | 43 |
1.8 | Other (Cinovec associated costs) | (469) | (469) |
1.9 | Net cash from / (used in) operating activities | (794) | (794) |
2. | Cash flows from investing activities | - | - |
2.1 | Payments to acquire or for: | ||
(a) entities | |||
(b) tenements | - | - | |
(c) property, plant and equipment | - | - | |
(d) exploration & evaluation | - | - | |
(e) investments | - | - | |
(f) other non-current assets | - | - | |
2.2 | Proceeds from the disposal of: | - | - |
(a) entities | |||
(b) tenements | - | - | |
(c) property, plant and equipment | - | - | |
(d) investments | - | - | |
(e) other non-current assets | - | - | |
2.3 | Cash flows from loans to other entities | - | - |
2.4 | Dividends received (see note 3) | - | - |
2.5 | Other (provide details if material) | - | - |
2.6 | Net cash from / (used in) investing activities | - | - |
3. | Cash flows from financing activities | - | - |
3.1 | Proceeds from issues of equity securities (excluding convertible debt securities) | ||
3.2 | Proceeds from issue of convertible debt securities | 500 | 500 |
3.3 | Proceeds from exercise of options | 635 | 635 |
3.4 | Transaction costs related to issues of equity securities or convertible debt securities | (50) | (50) |
3.5 | Proceeds from borrowings | - | - |
3.6 | Repayment of borrowings | - | - |
3.7 | Transaction costs related to loans and borrowings | - | - |
3.8 | Dividends paid | - | - |
3.9 | Other (provide details if material) | - | - |
3.10 | Net cash from / (used in) financing activities | 1,085 | 1,085 |
4. | Net increase / (decrease) in cash and cash equivalents for the period | ||
4.1 | Cash and cash equivalents at beginning of period | 59 | 59 |
4.2 | Net cash from / (used in) operating activities (item 1.9 above) | (794) | (794) |
4.3 | Net cash from / (used in) investing activities (item 2.6 above) | - | - |
4.4 | Net cash from / (used in) financing activities (item 3.10 above) | 1,085 | 1,085 |
4.5 | Effect of movement in exchange rates on cash held | - | - |
4.6 | Cash and cash equivalents at end of period | 350 | 350 |
5. | Reconciliation of cash and cash equivalentsat the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts | Current quarter$A'000 | Previous quarter$A'000 |
5.1 | Bank balances | 350 | 59 |
5.2 | Call deposits | - | - |
5.3 | Bank overdrafts | - | - |
5.4 | Other (provide details) | - | - |
5.5 | Cash and cash equivalents at end of quarter (should equal item 4.6 above) | 350 | 59 |
6. | Payments to related parties of the entity and their associates | Current quarter$A'000 | |
6.1 | Aggregate amount of payments to related parties and their associates included in item 1 | 100 | |
6.2 | Aggregate amount of payments to related parties and their associates included in item 2 | - | |
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments. | |||
Amounts paid to directors and their associates as director remuneration. A portion of these expenses are to be reimbursed directly from Geomet. | |||
7. | Financing facilitiesNote: the term "facility' includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity. | Total facility amount at quarter end$A'000 | Amount drawn at quarter end$A'000 |
7.1 | Loan facilities | 1,000 | 500 |
7.2 | Credit standby arrangements | - | - |
7.3 | Other (please specify) | - | - |
7.4 | Total financing facilities | 1,000 | 500 |
7.5 | Unused financing facilities available at quarter end | 500 | |
7.6 | Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.
| ||
On 14 July 2020, the Company secured a $1m funding facility with 6466 Investments Pty Ltd to assist in financing European Investor Relations initiatives, proposed listing in Czech (Refer to ASX Announcement dated 14 July 2020) and its ongoing operations. Any funds drawn down will convert to CDI's in the Company at a 15% discount to the 10- day vwap in the Company's securities. The funding facility ceases 12 months from execution date.
The Company made its first drawdown of A$250k on 17 July 2020 and completed the issue of 1,049,825 CDIs.
On 27 August 2020, the Company announced that it has completed the issue of 927,300 CDIs in respect to the second draw down of the funding facility. The Company received $250k in respect of the second draw down.
The Company made its third drawdown of A$250k on 23 October 2020 and completed the issue of 723,323 CDIs.
| |||
8. | Estimated cash available for future operating activities | $A'000 |
8.1 | Net cash from / (used in) operating activities (item 1.9) | (794) |
8.2 | (Payments for exploration & evaluation classified as investing activities) (item 2.1(d)) | - |
8.3 | Total relevant outgoings (item 8.1 + item 8.2) | (794) |
8.4 | Cash and cash equivalents at quarter end (item 4.6) | 350 |
8.5 | Unused finance facilities available at quarter end (item 7.5 - $500k plus R&D refund of $289k expected in the next quarter) | 789 |
8.6 | Total available funding (item 8.4 + item 8.5) | 1,139 |
8.7 | Estimated quarters of funding available (item 8.6 divided by item 8.3) | 1.43 |
Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as "N/A". Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7. | ||
8.8 | If item 8.7 is less than 2 quarters, please provide answers to the following questions: | |
8.8.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not? | ||
Answer: No. The Company has signed a final agreement with CEZ Group regarding its investment in Cinovec Project on 27 March 2020. This has reduced the Company's holding in Geomet to 49% and the Company will cease to consolidate Geomet's results within the Company's consolidated accounts. The Company has been appointed to provide services of managing the Cinovec project development. Included in net cash used in operating activities for the quarter are payments for two quarters relating to the capital investment into Geomet by CEZ Group of $386k which were reimbursed directly from Geomet.
The Company will continue to receive reimbursements from Geomet until at least end of Q4 2021.
Net cash used in operating activities for the quarter also included payments of USD201k (approximately AUD281k) of legal fees paid in relation to the shareholders agreement between CEZ Group and the Company.
Taking into consideration the extraordinary payments as described above, the Company estimates that item 8.7 (estimated quarters of funding available) is 3.56.
| ||
8.8.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful? | ||
Answer: No - the Company has no additional current plans to raise capital. | ||
8.8.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis? | ||
Answer: Yes. The Company expects to continue its operations and to meet its business objectives in the coming quarters. Please see Answer 2 above for more details.
| ||
Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered. | ||
Compliance statement
1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 30 October 2020
Authorised by: The Board
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee - eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.