Last checked at 19 Feb 2014 07:00
Hummingbird Resources PLC
("Hummingbird" or the "Company") (AIM: HUM)
Interim Results for the Six Months to 30 November 2013
and Operational Update
Hummingbird Resources, the Liberian gold exploration and development company, announces unaudited interim results for the six months ended 30 November 2013 and an operational update.
Operational Highlights
· Publication of updated Interim Mineral Resource Estimate for Tuzon which demonstrated a robust geological and resource model showing scope for initial starter pit near surface with higher grade zones
· Completion of 2,612m of the infill drilling campaign at Tuzon aimed to upgrade the US$1,500 pit constrained 1.5Moz Mineral Resource
· Appointment of MDM Engineering Group ("MDM") as lead consultant on the Detailed Feasibility Study ("DFS")
· Successful completion of Phase 1 metallurgical test work and throughput Options study
· Environmental and Social Impact Assessment ("ESIA") baseline studies are progressing in line with expectations
· DFS remains on track to be completed in Q3 2014
Financial Highlights for the period to 30 November 2013
· Cash of US$8.5m at period end
· Placing to raise £1.1m with Sprott Inc at 41p per share
· Appointment of Endeavour Financial to facilitate the Project Finance Debt Facility for the Company's Dugbe 1 Project
· Successful award of South African DTI grant for the DFS and FEED which is expected to significantly reduces the cost to the Company
Post Period Highlights
· Infill drilling at Tuzon completed in January 2014 providing further positive results
· Commencement of further drilling on the Dugbe F Resource on identified starter pits
Dan Betts, Chief Executive of Hummingbird Resources, said:
"With the DFS well advanced, and the Company being fully funded through to its completion, Hummingbird made significant steps in the second half of 2013. The appointment of MDM as lead engineering consultant and Endeavour Financial to assist in arranging Project Finance are both significant appointments as the Company remains on track to deliver first production from its Dugbe 1 Project."
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 Broker
Stewart Dickson / Tom Sheldon / Jeremy Stephenson +44 (0) 207 894 7000
FTI Consulting LLP
Financial PR
Ben Brewerton / Oliver Winters +44 (0) 207 831 3113
Operational Review
Following the selection of MDM as lead consultant and further key appointments, the Company's DFS and FEED remains on schedule for delivery in Q3 2014. Good progress has been made including a number of enhancements from the PEA such as lower strip ratios and the accessing of higher grade zones which will result in stronger project economics.
Updated Tuzon Resource
SRK Consulting, who were awarded the contract to complete the resource estimate for the DFS on the Tuzon gold deposit, completed an Interim Resource estimate during the period. The table below shows the resulting Mineral Resource Statement for Tuzon. By applying a lower cost pit shell (US$600), a coherent zone of higher grade material (1.63g/t Au for 0.41Moz at a 0.8g/t Au cut-off) is defined near surface (strip ratio of 1.3:1) in the northern part of the deposit. This area is highly conducive for planning production in the early years of the project during the initial payback period.
Mineral Resource Statement for the Tuzon Gold Project
Classification | Zone | Density | Tonnage (Kt) | Au (g/t) | Au (Koz) |
Indicated | A (High Grade) | 2.78 | 6,650 | 1.57 | 337 |
A (Low Grade) | 2.78 | 4,180 | 0.60 | 81 | |
B (High Grade) | 2.78 | 1,670 | 1.44 | 77 | |
B (Low Grade) | 2.78 | 300 | 0.59 | 6 | |
Total | 2.78 | 12,800 | 1.22 | 501 | |
Inferred | A (High Grade) | 2.78 | 4,510 | 1.46 | 212 |
A (Low Grade) | 2.78 | 4,760 | 0.63 | 96 | |
B (High Grade) | 2.78 | 10,810 | 1.75 | 606 | |
B (Low Grade) | 2.78 | 1,240 | 0.54 | 21 | |
Hangingwall 1 | 2.78 | 1,170 | 0.72 | 27 | |
Hangingwall 2 | 2.78 | 600 | 1.06 | 21 | |
Internal | 2.78 | 430 | 0.75 | 11 | |
Oxide | 1.7 | 1,310 | 1.10 | 46 | |
Total | 2.72 | 24,830 | 1.31 | 1,040 | |
Grand Total | 37,630 | 1.27 | 1,541 |
*Reported within a US$1,500 pit shell at a cut-off grade of 0.5 g/t
Metallurgy
The completion of the Phase 1 metallurgical test work resulted in the selection of a straight Carbon in Leach ("CIL") flow sheet, as pre-concentration by flotation or gravity concentration offered no material benefits to Run of Mine treatment by CIL. The Phase 2 metallurgical test work programme is underway with the following two primary objectives:
· Determining the grind size, where the cost of milling (opex) vs. gold recovery (revenue) is optimised; and
· Metallurgical mapping, to better understand the variability across the deposit.
Options Study
The initial assessment of the economic implications, including both capex and opex, of different potential throughputs has been completed and is under review. A decision on the throughput of the project will be made during Q1 2014 which will allow MDM to proceed with detailed design and costing of the plant.
Financing
During the period the Company successful raised £1.1 million through a placing with Sprott Group. The Company is very pleased to welcome Sprott as a new shareholder. They have a long track record of successful investments in the natural resources sector and their investment is a further endorsement of the Dugbe 1 Project.
ESIA
All ESIA baseline studies, carried out by AMEC, are underway and on target for completion in Q3 2014. The studies include: soil baseline, biodiversity, water quality and socio-economic studies. In addition, we are completing a second round of stakeholder engagement meetings with the local communities, a central pillar to our stakeholder engagement strategy.
Exploration
Following the airborne magnetics and radiometric survey carried out earlier in 2013, the final interpretations and report into the findings were published during the period.
The analysis of existing Hummingbird gold prospect results, combined with the airborne survey's geological and structural interpretation, has resulted in a large number of targets, numbering some 140 in total, to be followed up with further systematic exploration. A number of highly prospective targets identified within the Dugbe 1 Project area are of immediate priority. Planned activities include geological mapping, infill soil geochemistry and trenching/RAB drilling to rapidly identify new resources.
Post period end
The Company recently published the results from its recent infill drilling programme for its Tuzon deposit. The purpose of the programme is to convert the remaining Inferred Resources into the Indicated category. The results have matched the existing model which was the aim of the infill drill programme.
The Company has commenced further drilling on the Dugbe F Resource with the intention of moving several starter pits into Indicated category. It is expected the results will form part of the DFS and may offer upside in the early years of mining due to its better grade of mineralisation and low strip ratio. Drilling is expected to be finished in Q1 2014.
HUMMINGBIRD RESOURCES PLC
Unaudited Consolidated Income Statement
For the six months ended 30 November 2013
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| Unaudited six months ended 30 November | Unaudited six months ended 30 November |
Audited year ended 31 May |
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| 2013 | 2012 | 2013 |
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| Note | $'000 | $'000 | $'000 |
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Continuing operations |
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Revenue | - | - | - | |||
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Profit on deemed disposal | - | - | - | |||
Share based payments | 5 | (152) | (315) | (679) | ||
Other administrative expenses | (1,563) | (1,361) | (2,786) | |||
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Administrative expenses | (1,715) | (1,676) | (3,465) | |||
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Finance income | 295 | 248 | 463 | |||
Finance expense | 4 | (30) | - | (145) | ||
Share of joint venture loss | (17) | (81) | (225) | |||
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Loss before tax | (1,467) | (1,509) | (3,372) | |||
Tax | - | - | - | |||
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Loss for the period/year attributable to equity holders of the parent | (1,467) | (1,509) | (3,372) | |||
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Loss per ordinary share | ||||||
Basic and diluted (US$ cents) | 3 | (2.67) | (2.82) | (6.13) | ||
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There was no other comprehensive income in the current or prior periods.
HUMMINGBIRD RESOURCES PLC
Unaudited Consolidated Balance Sheet
As at 30 November 2013
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| Unaudited 30 November | Unaudited 30 November |
Audited 31 May | ||
| 2013 | 2012 | 2013 | ||
| Note | $'000 | $'000 | $'000 | |
Assets |
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Non-current assets |
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Intangible exploration and evaluation assets | 51,294 | 38,522 | 46,589 | ||
Property, plant and equipment | 249 | 891 | 607 | ||
Investment in joint venture | 694 | 855 | 711 | ||
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| 52,237 | 40,268 | 47,907 | ||
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Current assets | |||||
Trade and other receivables | 667 | 833 | 753 | ||
Cash and cash equivalents | 8,557 | 7,148 | 13,692 | ||
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| 9,224 | 7,981 | 14,445 | ||
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Total assets | 61,461 | 48,249 | 62,352 | ||
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Liabilities | |||||
Current liabilities | |||||
Trade and other payables | (1,276) | (1,273) | (2,564) | ||
Other financial liabilities | (10,079) | - | (10,049) | ||
Amounts due to joint venture | (214) | (590) | (382) | ||
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Total liabilities | (11,569) | (1,863) | (12,995) | ||
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Net assets | 49,892 | 46,386 | 49,357 | ||
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Equity |
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Share capital | 5 | 953 | 857 | 908 | |
Share premium | 5 | 48,135 | 41,990 | 46,355 | |
Retained earnings | 804 | 3,539 | 2,094 | ||
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Equity attributable to equity holders of the parent |
| 49,892 | 46,386 | 49,357 | |
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HUMMINGBIRD RESOURCES PLC
Unaudited Consolidated Statement of Cash Flows
For the six months ended 30 November 2013
| Unaudited six months ended 30 November | Unaudited six months ended 30 November |
Audited year ended 31 May | ||
| 2013 | 2012 | 2013 | ||
| $'000 | $'000 | $'000 | ||
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Operating activities | |||||
Loss before tax | (1,467) | (1,509) | (3,372) | ||
Adjustments for: | |||||
Finance income | (295) | (248) | (463) | ||
Finance expense | 30 | - | 145 | ||
Share of joint venture loss | 17 | 81 | 225 | ||
Depreciation of property, plant and equipment | 64 | 63 | 133 | ||
Share based payments | 152 | 315 | 679 | ||
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Operating cash flows before movements in working capital | (1,499) | (1,298) | (2,653) | ||
Decrease / (Increase) in receivables | 132 | (37) | 31 | ||
(Decrease) in payables | (50) | (387) | (478) | ||
Increase in amounts due from joint venture | - | 35 | 35 | ||
(Decrease) in amounts due to joint venture | (168) | (549) | (757) | ||
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Net cash outflow from operating activities | (1,585) | (2,236) | (3,822) | ||
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Investing activities |
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Purchases of intangible exploration and evaluation assets |
| (5,706) | (6,373) | (12,458) | |
(Disposal) / Purchases of property, plant and equipment |
| 34 | (46) | (85) | |
Interest received |
| 56 | 66 | 150 | |
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Net cash used in investing activities |
| (5,616) | (6,353) | (12,393) | |
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Financing activities |
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Net proceeds from issue of shares |
| 1,825 | 70 | 4,486 | |
Proceeds from warrants issued |
| - | - | 355 | |
Financial liabilities issued net of issue costs |
| - | - | 9,708 | |
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Net cash from financing activities |
| 1,825 | 70 | 14,549 | |
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Net Decrease in cash and cash equivalents |
| (5,376) | (8,519) | (1,666) | |
Effect of foreign exchange rate changes |
| 241 | 164 | (145) | |
Cash and cash equivalents at beginning of period/year |
| 13,692 | 15,503 | 15,503 | |
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Cash and cash equivalents at end of period/year |
| 8,557 | 7,148 | 13,692 | |
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HUMMINGBIRD RESOURCES PLC
Unaudited Consolidated Statement of Changes in Equity
For the six months ended 30 November 2013
Share capital $'000 |
Share premium $'000 | Retained earnings $'000 | Total $'000 | |
For the six months ended 30 November 2013 | ||||
As at 1 June 2013 | 908 | 46,355 | 2,094 | 47,469 |
Issue of shares | 45 | 1,780 | - | 1,825 |
Share based payments | - | - | 177 | 177 |
Total comprehensive loss for the period | - | - | (1,467) | (1,467) |
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As at 30 November 2013 | 953 | 48,135 | 804 | 49,867 |
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For the six months ended 30 November 2012 | ||||
As at 1 June 2012 | 855 | 41,922 | 4,692 | 47,469 |
Issue of shares | 2 | 68 | - | 70 |
Share based payments | - | - | 356 | 356 |
Total comprehensive loss for the period | - | - | (1,509) | (1,509) |
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As at 30 November 2012 | 857 | 41,990 | 3,539 | 46,386 |
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For the year ended 31 May 2013 | ||||
As at 1 June 2012 | 855 | 41,922 | 4,692 | 47,469 |
Issue of shares | 53 | 4,433 | - | 4,486 |
Share based payments | - | - | 774 | 774 |
Total comprehensive loss for the year | - | - | (3,372) | (3,372) |
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As at 31 May 2013 | 908 | 46,355 | 2,094 | 47,469 |
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1 General information
Hummingbird Resources plc (the 'Company'), was 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 is the exploration, evaluation and development of mineral exploration targets, principally gold, focused primarily in Liberia.
2 Basis of preparation
The consolidated interim financial information has been prepared using policies based on International Financial Reporting Standards issued by the International Accounting Standards Board ("IASB") as adopted by the European Union, which are expected to be applied in the Group's financial statements for the year ended 31 May 2014.
The consolidated interim financial information for the period 1 June 2013 to 30 November 2013 is unaudited, does not include all the information required for full financial statements and should be read in conjunction with the Group's consolidated financial statements for the year ended 31 May 2013. In the opinion of the Directors the consolidated interim financial information for the period represents fairly the financial position, results from operation and cash flows for the period in conformity with generally accepted accounting principles consistently applied. The consolidated interim financial information incorporates comparative figures for the interim period 1 June 2012 to 30 November 2012 and the audited financial year to 31 May 2013. As permitted, the Group has chosen not to adopt IAS34 'Interim Financial Reporting'.
The annual financial statements of Hummingbird Resources plc are prepared in accordance with International Financial Reporting Standards ('IFRSs') as issued by the International Accounting Standards Board ('IASB') and as adopted by the European Union. The Group's consolidated annual financial statements for the year ended 31 May 2013, have been filed with the Registrar of Companies and are available on the Company's website www.hummingbirdresources.co.uk. The auditor's report on those financial statements was unqualified and did not contain a statement under sections 498(2) or (3) of the Companies Act 2006.
3 Loss per ordinary share
Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period/year.
Due to the losses incurred during the period a diluted loss per share has not been calculated as this would serve to reduce the basic loss per share.
The calculation of the basic and diluted loss per share is based on the following data:
| Unaudited six months ended 30 November 2013 $'000 | Unaudited six months ended 30 November 2012 $'000 |
Audited year ended 31 May 2013 $'000 |
Losses
Loss for the purposes of basic loss per share being net loss attributable to equity holders of the parent |
(1,467) |
(1,509) |
(3,372) |
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Number of shares |
Number |
Number |
Number |
Weighted average number of Ordinary shares for the purposes of basic loss per share | 56,756,683 | 53,487,286 | 55,000,447 |
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US$ cents |
US$ cents |
US$ cents |
Loss per Ordinary share | |||
Basic and diluted (US$ cents) | (2.67) | (2.82) | (6.13) |
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4 Finance expense
The finance expense in the current period arose as a result of losses on the revaluation of warrants at 30 November 2013.
5 Share capital
5.1 Issued equity share capital
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| Unaudited 30 November 2013 Number | Unaudited 30 November 2012 Number | Audited 31 May 2013 Number | |
Issued and fully paid | ||||
Ordinary shares of £0.01 each | 59,484,764 | 53,500,565 | 56,726,371 | |
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| Unaudited 30 November 2013 $'000 | Unaudited 30 November 2012 $'000 |
Audited 31 May 2013 $'000 | |
Issued and fully paid Ordinary shares of £0.01 each |
953 |
857 |
908 | |
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On 28 November 2013 the company issued 2,758,393 new Ordinary Shares at a price of 41 pence per new Ordinary Share, to raise approximately £1.1 million (before expenses) with Exploration Capital Partners 2012 Limited Partnership ("Exploration Capital"). Exploration Capital is a private investment fund managed by Resource Capital Investment Corp., part of the Sprott Group of Companies.
5.2 Share options
At the 30 November 2013 there were 4,708,500 share options outstanding.
5.3 Share based payments
The share based payments expense in the income statement of $152,000 for the period includes a charge of $14,000 relating to share options granted on 27 June 2011 and $167,000 in respect of share options granted on 11 July 2012.
6 Events after the balance sheet date
The Company announces that on 5 December 2013, 2,336,500 options over ordinary shares of 1p each in the Company were granted to certain directors, group employees and consultants. These share options are exercisable at 41p per share and amount to 3.9% of the issued share capital in total. The share options vest in two tranches over the period to 1 June 2015 and / or on satisfaction of certain performance criteria being met in accordance with our policy of retaining and motivating key individuals.
Additionally as a condition of the grant of certain of these options on 5 December 2013 1,501,500 options over ordinary shares of 1p each in the Company were voluntarily relinquished by the holders. These share options amounted to 2.5% of the issued share capital in total.
Notes to Editors
About Hummingbird Resources Plc
Hummingbird Resources plc is an AIM quoted mineral exploration company incorporated in England and Wales and headquartered in London. Since its establishment in November 2005, the Company and its subsidiaries (the "Group") has been active in Liberia, West Africa, and is currently the holder of the largest area of mineral exploration ground in the highly prospective Birimian geological region of eastern Liberia. The Group has published a PEA on its project showing on a 3.5Mtpa tank leach operations an NPV of US$337m on a Capex of US$212m for an IRR of 43.4%. This gives a payback period of 3 years and is based on a 10% discount rate and US$1,500 gold price (three year average gold price at time of release).
The Group has recently published aMineral Resource estimate for the Tuzon deposit constrained within a US$1,500 pit shell and using a 0.5 g/t cut off grade comprising of 37.6 Mt at an average grade of 1.27 g/t for 1.54 Moz of gold under the 2004 Edition JORC code. The Group has also published a NI43-101 compliant Inferred Resource on its Dugbe F deposit of 43.01 million tonnes at 1.28 g/t Au to give 1,764,000 ounces of gold using a lower cut-off grade of 0.5 g/t Au and no upper cut-off grade.
In Q3 2014, the Group is due to release a Detailed Feasibility Study and Front End Engineering Design. The Group's licence areas constitute a significant proportion of eastern Liberia's Birimian sequence.
For more information, please visit www.hummingbirdresources.co.uk