Last checked at 27 May 2015 07:00
Ticker: HUM / Index: AIM / Sector: Mining
27 May 2015
Hummingbird Resources plc ("Hummingbird" or the "Company")
Final results for the period ended 31 December 2014
A transformational period - acquisition of Yanfolila Gold Project with first gold pour expected in H1 2016
Hummingbird Resources plc, the gold exploration and development company with assets in Mali and Liberia, announces its final audited results for the period ended 31 December 2014.
Operational Highlights (includes post period highlights)
Mali - Yanfolila
· Yanfolila Project, 1.8Moz at 2.8g/t, in Mali
o Completed acquisition of Yanfolila Project in Mali from Gold Fields Ltd ("Gold Fields") in July 2014
o Optimisation study published March 2015
o Initial earthworks underway, production due H1 2016
o Targeting 100,000ozs gold production in year 1
o IRR 35.1%, NPV US$72.4m
o AISC US$733/oz, C1 Cash cost of US$641/oz
o Significant potential to enhance economics and extend mine life
Liberia - Dugbe
· Dugbe 1 Project, 4.2Moz at 1.4g/t, in Liberia
o Liberia's largest gold resource with huge exploration potential
o Collaboration Agreement signed with the International Finance Corporation ('IFC') and Aldwych International to conduct a hydro-electric power pre-feasibility study
Corporate
o Appointment of Russell King as Non-Executive Chairman
o US$10m drawn down from Taurus Mining Finance Fund Bridge Facility
o Funding package of a US$9.5m for Yanfolila Project announced post period-end
This report has been written to cover the period from 1st June 2014 to 31st December 2014 and post period end. This is due to the change of year end for the Company to align it with all subsidiary Group companies. Please see the Company's website for all up to date news including construction updates for the Yanfolila Project, www.hummingbirdresources.co.uk.
Enquiries:
Hummingbird Resources plc | |
Daniel Betts, Chief Executive Officer | |
Thomas Hill, Finance Director | |
Robert Monro, Head of Business Development | +44 (0) 203 416 3560 |
Cantor Fitzgerald Europe | |
Nominated Adviser and Corporate Broker | |
Stewart Dickson / Jeremy Stephenson / Carrie Lun | +44 (0) 207 894 7000 |
St Brides Partners Ltd | |
Financial PR | |
Lottie Brocklehurst/ Felicity Winkles | +44 (0) 207 236 1177 |
Notes to Editors
About Hummingbird Resources Plc
Hummingbird Resources (AIM: HUM) is building a leading gold production, development and exploration company. The Company has two core gold projects, the near-term production Yanfolila Project in Mali and the Dugbe 1 Project in Liberia. Its current focus is on bringing Yanfolila, which has a 1.8Moz gold inventory, to production in H1 2016. The high grade gold project has the potential to turn a profit in a varying gold price environment and will allow for quick returns with low operating costs.
The 4.2Moz Dugbe 1 Project in Liberia provides Hummingbird with excellent development upside. An optimisation of the DFS is on-going whilst Yanfolila is brought to production in the near-term. Additionally, the Company has 5,000km2 highly prospective exploration ground in Mali and Liberia and is constantly evaluating new quality assets.
For more information, please visit www.hummingbirdresources.co.uk
Chairman's Statement
The last financial period, and my first as Chairman of the Company, has been an extremely busy one. During the period the Company successfully acquired the Yanfolila Project from Gold Fields and embarked on a rapid Optimisation Study to 'right size' Gold Fields' studies to the current environment. Since the end of the period the Company has also announced the results of the Optimisation Study, completed a successful placement and started earthworks at Yanfolila. As well as this, the Company continues to progress the Dugbe 1 Project in Liberia. The Company has recently signed a Collaboration Agreement with the IFC on a hydro-electric power pre-feasibility study as part of our continued drive to add value to the Project.
As I present to you the Company's Annual Report I believe the business is well placed and on track to deliver value to our shareholders. In the midst of an on-going bear market for miners the Company has grown its assets significantly and is due to commence production in H1 2016 at its Yanfolila Project in Mali.
It has been a pleasure working with the management team since I joined and I look forward to chairing Hummingbird as it becomes a gold producer and looks to take advantage of further expansion opportunities in the sector.
Russell King
Non-Executive Chairman
CEO'S STATEMENT
It brings me great pleasure to write that initial earthworks have started at the Yanfolila Project. We are due to start production in H1 2016 and will be targeting 100,000ozs of gold produced at an operating cash cost of US$641/oz in our first full year of commercial operations.
Optimisation Study:
The Optimisation Study shows a low-cost, low technical risk and quick route to gold production for Yanfolila. The initial target is 100,000oz of gold for the first year of full production with a LOM production of 79,000oz/year and an all-in sustaining cash cost of US$733/oz from a 1Mtpa plant. In addition, there are multiple options to significantly increase the project economics and LOM. These include, but are not limited to, the ability of the plant to now process up to 50% fresh ore and significant inferred ounces that have the ability to be upgraded and added to a mining schedule in the future. Importantly we have the team with the operational experience to achieve all of this.
Construction Update:
Earthworks will consist of initial excavation, placement, and compaction of fill materials of over 80,000 cubic metres. Work being undertaken will consist of: constructing the process plant terrace; plant infrastructure terrace; including reagent storage and handling; change house and security facility areas; power plant terrace; in plant roads; and storm event pond.
The objective of this work, which is due for completion by the end of June 2015, is to complete the preparation of level compacted areas at the Yanfolila plant site for use by the civil contractor to place structural concrete equipment foundations and slabs.
Financing:
On the 11th August 2014 the Group entered into a Mandate Letter and Bridge Loan Agreement with Taurus Mining Finance Fund LP, and subsequently drew down the full US$10m available under the Bridge Loan Agreement. The Mandate Letter set out the key terms of the refinancing mandate for a US$75m facility to repay amounts due under the Bridge Loan Agreement and fund the construction of the Yanfolila Project. We are currently in discussions with Taurus over the next stage of funding. Additionally, following the period end the Company announced a funding package of US$9.5m for the Yanfolila Project, consisting of US$4.5m raised through a placing and open offer and a binding agreement with BCM International Limited to subscribe for up to US$5m shares in lieu of payment for services.
Liberia:
The Dugbe 1 Project remains a company-making project with an anticipated 20 year mine life of over 125,000ozs/year production based on our PEA results. We are very happy to have signed the Collaboration Agreement with the IFC and Aldwych International, which is funded by the IFC Infraventures fund, to conduct a pre-feasibility study on the potential to build a 20-30MW hydro-electric run of river power plant 10-15km from the project site. With the cost of diesel power currently accounting for up to 40% of our operating costs, the potential for low cost hydro-electric power could have a significant material impact on the project economics. Work on reviewing and optimising the Dugbe 1 Project DFS is also on-going and whilst we focus on getting Yanfolila in production we are taking the time to fully evaluate all opportunities to improve the existing DFS.
Conclusion:
I am very pleased to sign off by saying that by our next report I should be informing you of an imminent first gold pour pending completion of a successful construction and then commissioning phase. Thank you once again to all the staff at Hummingbird for your continued efforts in driving the business forward, and to our supportive shareholders.
Dan Betts
CEO
Consolidated Income Statement
For the period ended 31 December 2014
7 months to 31 Dec 2014 $'000 |
12 months to 31 May 2014 $'000 | Unaudited 6 months to 30 Nov 2014 $'000 | |
Continuing operations | |||
Revenue | - | - | - |
Share based payments | (119) | (454) | (103) |
Other administrative expenses | (3,067) | (3,635) | (2,831) |
Administrative expenses | (3,186) | (4,089) | (2,934) |
Finance income | 104 | 334 | 100 |
Finance expense | (268) | (86) | (167) |
Share of joint venture loss | (32) | (625) | (32) |
Loss before tax | (3,382) | (4,466) | (3,033) |
Tax | - | - | - |
Loss for the period attributable to equity holders of the parent | (3,382) | (4,466) | (3,033) |
Loss per ordinary share | |||
Basic and diluted ($ cents) | (4.27) | (7.68) | (3.87) |
|
7 months to 31 Dec 2014 $'000 |
12months to 31 May 2014 $'000 | Unaudited 6 months to 30 Nov 2014 $'000 |
Loss for the period | (3,382) | (4,466) | (3,033) |
Other comprehensive income | |||
Exchange translation differences on foreign operations | - | - | - |
Total comprehensive loss for the period attributable to equity holders of the parent | (3,382) | (4,466) | (3,033) |
Consolidated Balance Sheet
As at 31 December 2014
31 Dec 2014 $'000 |
31 May 2014 $'000 | Unaudited 30 Nov 2014 $'000 | ||
Assets | ||||
Non-current assets | ||||
Intangible exploration and evaluation assets | 86,827 | 56,738 | 84,001 | |
Property, plant and equipment | 749 | 107 | 781 | |
Investment in joint venture | 54 | 86 | 54 | |
87,630 | 56,931 | 84,836 | ||
Current assets | ||||
Trade and other receivables | 870 | 677 | 839 | |
Cash and cash equivalents | 8,536 | 6,983 | 10,322 | |
9,406 | 7,660 | 11,161 | ||
Total assets | 97,036 | 64,591 | 95,997 | |
Liabilities | ||||
Current liabilities | ||||
Trade and other payables | 4,317 | 2,075 | 2,963 | |
Other financial liabilities | 15,050 | 15,135 | 15,050 | |
Amounts due to joint venture | - | 185 | - | |
Non-current liabilities | ||||
Borrowings | 9,793 | - | 9,778 | |
Total liabilities | 29,160 | 17,395 | 27,791 | |
Net assets | 67,876 | 47,196 | 68,206 | |
Equity | ||||
Share capital | 1,385 | 953 | 1,385 | |
Share premium | 71,627 | 48,135 | 71,627 | |
Retained earnings | (5,136) | (1,892) | (4,806) | |
Equity attributable to equity holders of the parent | 67,876 | 47,196 | 68,206 |
Consolidated Statement of Cashflows
For the period ended 31 December 2014
|
|
7 months to 31 Dec 2014 $'000 |
12 months to 31 May 2014 $'000 | Unaudited 6 months to 30 Nov 2014 $'000 |
|
Net cash outflow from operating activities | (3,319) | (3,224) | (3,324) |
| |
Investing activities |
| ||||
| Purchases of intangible exploration and evaluation assets | (7,252) | (10,747) | (5,965) |
|
| Disposals / (purchases) of property, plant and equipment | - | 40 | (1) |
|
| Interest received | 12 | 130 | 11 |
|
| Cash and cash equivalents in subsidiaries acquired | 200 | - | 199 |
|
Net cash used in investing activities | (7,040) | (10,577) | (5,756) |
| |
Financing activities |
| ||||
| Net proceeds from issue of shares | 2,808 | 1,825 | 2,808 |
|
| Loan interest paid | (350) | - | - | |
| Financial liabilities issued net of issue costs | 9,722 | 5,000 | 9,778 |
|
Net cash from financing activities | 12,180 | 6,825 | 12,586 |
| |
Net Increase/(decrease) cash and cash equivalents | 1,821 | (6,976) | 3,506 |
| |
| Effect of foreign exchange rate changes | (268) | 267 | (167) |
|
| Cash and cash equivalents at beginning of period | 6,983 | 13,692 | 6,983 |
|
Cash and cash equivalents at end of period | 8,536 | 6,983 | 10,322 |
| |
|
| ||||
Consolidated Statement of Changes in Equity
For the period ended 31 December 2014
| Share capital $'000 | Share premium $'000 | Retained earnings $'000 | Total $'000 |
As at 1 June 2013 | 908 | 46,355 | 2,094 | 49,357 |
Comprehensive loss for the year: | ||||
Loss for the year | - | - | (4,466) | (4,466) |
Total comprehensive loss for the period | - | - | (4,466) | (4,466) |
Transactions with owners in their capacity as owners | ||||
Issue of shares net of costs | 45 | 1,780 | - | 1,825 |
Total transactions with owners in their capacity as owners | 45 | 1,780 | - | 1,825 |
Share based payments | - | - | 480 | 480 |
As at 31 May 2014 | 953 | 48,135 | (1,892) | 47,196 |
Comprehensive loss for the period: | ||||
Loss for the period | - | - | (3,382) | (3,382) |
Total comprehensive loss for the period | - | - | (3,382) | (3,382) |
Transactions with owners in their capacity as owners | ||||
Issue of shares net of costs | 432 | 23,492 | - | 23,924 |
Total transactions with owners in their capacity as owners | 432 | 23,492 | - | 23,924 |
Share based payments | - | - | 138 | 138 |
As at 31 December 2014 | 1,385 | 71,627 | (5,136) | 67,876 |
Unaudited 6 months ending 30 November 2014 | ||||
As at 1 June 2014 | 953 | 48,135 | (1,892) | 47,196 |
Comprehensive loss for the period: | ||||
Loss for the period | - | - | (3,033) | (3,033) |
Total comprehensive loss for the period | - | - | (3,033) | (3,033) |
Transactions with owners in their capacity as owners | ||||
Issue of shares net of costs | 432 | 23,492 | - | 23,924 |
Total transactions with owners in their capacity as owners | 432 | 23,492 | - | 23,924 |
Share based payments | - | - | 119 | 119 |
As at 30 November 2014 | 1,385 | 71,627 | (4,806) | 68,206 |
Notes to the Consolidated Financial Information
For the period ended 31 December 2014
1. GENERAL INFORMATION
Hummingbird Resources Plc, is incorporated in England and Wales under the Companies Act. The address of the registered office is 49-63 Spencer Street, Hockley, Birmingham, West Midlands, B18 6DE
The nature of the Group's operations and its principal activities are the exploration, evaluation and development of mineral exploration targets, principally gold, focused exclusively in West Africa.
2. BASIS OF PREPARATION
The consolidated financial information contained within this announcement has been extracted from the audited financial statements for the period ended 31 December 2014 (for the periods ended 31 December 2014 and 31 May 2014) and the unaudited interim financial statements for the period ended 30 November 2014.
The audited financial statements for the period ended 31 December 2014 have been prepared in accordance with International Financial Reporting Standards ("IFRSs") as issued by the International Accounting Standards Board ("IASB") and as adopted by the EU and those parts of the Companies Act 2006 applicable to companies reporting under IFRS.
The functional currency of all companies in the Group is United States Dollar ("$"). The financial statements are presented in thousands of United States dollars ('$'000'). For reference the period-end exchange rate from Sterling to $ was $1.5532 (May 2014: $1.6742).
3. LOSS PER ORDINARY SHARE
Basic loss per ordinary share is calculated by dividing the net loss for the period attributable to ordinary equity holders of the parent by the weighted average number of Ordinary shares outstanding during the period.
The calculation of the basic and diluted loss per share is based on the following data:
7 months to 31 Dec 2014 $'000 |
12 months to 31 May 2014 $'000 | Unaudited 6 months to 30 Nov 2014 $'000 | |
Losses Loss for the purposes of basic loss per share being net loss attributable to equity holders of the parent |
(3,382) |
(4,466) |
(3,033) |
Number of shares | 31 Dec 2014 Number | 31 May 2014 Number | 30 Nov 2014 Number |
Weighted average number of ordinary shares for the purposes of basic loss per share | 79,266,208 | 58,120,724 | 78,316,269 |
Loss per ordinary share | 31Dec 2014 $ cents | 31 May 2014 $ cents | 30 Nov 2014 $ cents |
Basic and diluted | (4.27) | (7.68) | (3.87) |
At the balance sheet date there were 7,376,158 (31 May 2014: 7,249,658) potentially dilutive ordinary shares. Potentially dilutive ordinary shares include share options issued to employees and Directors, warrants issued to the IFC and the conditional acquisition of the 20% interest in the Joe Village licence, which the Group did not previously own. At 31 December 2014 the potential ordinary shares are anti-dilutive and therefore there is no difference between basic and diluted loss per share.
4. AVAILABILITY OF ACCOUNTS
The audited Annual Report and Financial Statements for the 7 months ended 31 December 2014 and notice of AGM will shortly be sent to shareholders and published at:
www.hummingbirdresources.co.uk