GoldPlat Regulatory News (GDP)

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

8 November 2022

Goldplat plc

('Goldplat', the 'Group' or 'the Company')

1st Quarter operating results update

for the period ended 30 September 2022 ("Q1")

Goldplat, 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 Q1.

The two recovery operations continued the strong combined operating performance of the previous quarter and achieved a combined operating profit for the quarter of £1,942,000 (excluding listing and head office costs and foreign exchange losses) which represents a 38% increase against Q1 in the previous period (Q1 2021: £1,403,000).

The Ghanaian operation continues to perform well as a result of the steady supply of material and achieved an operating profit for Q1 of £966,000 (Q1 2021: £839,000).

The South African operations continued to produce steady returns from the assortment of material processed through a variety of plants. During the quarter the operations have been impacted due to intermittent electricity cuts by the electricity provider in the country to reduce the load on the network. Notwithstanding the electricity cuts, the South African operation achieved an operating profit for Q1 of £976,000 (Q1, 30 September 2021: £564,000).

Goldplat's returns are impacted by changes in reporting currencies for each subsidiary and United States Dollar ("USD"), as well as the gold price.

During Q1, the Group operating entities' operational results benefited from the weakening of the reporting currencies Ghanaian Cedi and the South African Rand, which increased operating results by circa £500,000. As the Company receives payment for the majority of its revenue on pre-financing contracts, foreign exchange losses in the order of £500,000 have been incurred during the period have not been reflected in the operational results above. Taking account of these exchange losses, operating profit for the recovery operations for the quarter was £1,442,000.

Although Goldplat processes an assortment of material throughout the Group from different clients and on different contracts making use of a wide range of plant and equipment, the Group has been delivering profitable albeit fluctuating operations returns, for the last 11 quarters, which is in line with management's focus on ensuring sustainable cashflow and profitability. 

The Group is further pleased to announce that:

- DRD Gold Limited ("DRD Gold") has agreed for Goldplat Recovery (Pty) Ltd ("GPR") to remove low-grade carbon contaminated soils from their premises, on a cost per ton basis, which should provide circa 5 years of additional feed for our larger CIL circuit. The CIL circuit currently contributes between 20% to 30% of the South African operation´s production. This increases the availability of material for this circuit to more than 7 years and will form a good base for the business going forward.

- The nature of these materials to be removed from DRD Gold, will be variable, in terms of the gold grade contained and the recoverability of the gold contained through our circuits. The analysis and processing of these materials to date has indicated that it will be viable to remove and process at current cost and price parameters. 

- DRD Gold is also assisting GPR to get approval for the construction of a pipeline to one of their plants. The pipeline will provide GPR with the ability to process the existing Tailings Storage Facility ("TSF") which contains a JORC resource of circa 82,000 ounces of gold (Table 1) at a DRD Gold processing facility.

- The negotiations of the terms and conditions of processing our existing TSF at a DRD Gold processing facility still need to be finalised.

- The approval of the pipeline by authorities is taking longer than originally expected, but we believe this will be received, at the latest, by June 2023.

Goldplat has identified and to an extent secured material in ECOWAS ("The Economic Community of West African States"); however the export and processing of these materials remain dependent on approval from governments' officials. We continue our engagement with the governments and mines in the ECOWAS to agree processes and controls on the export of gold bearing products and remain encouraged by the value we have identified that we can offer in these countries.

The majority of material processed in Ghana during Q1 was from clients inside the country.

We continue with our expansion into South America on a measured basis, with limited capital allocated as yet.

Despite numerous issues experienced during the commissioning of the PGM flotation plant in South Africa, which has resulted in us not being able to run the plant optimally to date, we are encouraged with the progress made and with the increased flexibility the flotation plant will provide us in the type of material we can process. 

The construction of the new TSF will start in Q2 (to 31 December 2022) and we aim to have this completed by the end of Q4 (to 30 June 2023)

During Q1 the Group incurred capital cost of £630,000 and we are estimating that we will require a further £1,500,000 during the next 12 to 18 months to be spent, on repairing and maintaining current operations, and on improved lining of the new TSF and improving the environmental impacts of our current processes.

We are currently estimating to announce the Group's audited annual results towards the beginning of December 2022.

Cash balances in the group remained strong at £2,920,000 at the end of Q1 (Q1 2021: £2,340,000), (Q4 2022: £3,672,000).

Werner Klingenberg, CEO of Goldplat commented: "I am pleased to announce the progress we have made in achieving our key strategic deliverables, generating continued profitability from the processing of previously mined gold and PGM materials, increased visibility of future earnings through increasing our resources and forming strategic relationships with other key industry participants, finding a final deposition site and processing plant for our existing TSF and getting approval for the construction of a new TSF.

We continue to invest time into identifying different methods of processing materials containing various elements in environmentally friendlier methods to become a key service provider to the mining industry to beneficiate, process and dispose of their by-products and waste.

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

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.

Table 1

Mineral Resource Estimate of the TSF, South Africa

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.