Ironveld Regulatory News (IRON)

30 March 2023

IRONVELD PLC

("Ironveld" or the "Company")

Interim results for the six months ended 31 December 2022

Ironveld plc, the owner of a High Purity Iron ("HPI"), Vanadium and Titanium project located on the Northern Limb of the Bushveld Complex in Limpopo Province, South Africa (the "Project") is pleased to announce its interim results for the six months ended 31 December 2022 ("the period").

Highlights

· A transformative period for the Company saw the acquisition and commencement of refurbishment of the smelter facility at Rustenburg, from August 2022 onwards;

· Acquisition and refurbishment funded by an equity Placing of £4.50 million, which completed in August 2022;

· First mining activities also commenced prior to period end, to ensure consistent supply of magnetite ore to the smelter; and

· Post period end saw first production from the smelter, an additional £2.0 million fundraising from shareholders and the smelter acquisition becoming unconditional.

Outlook

· First sales on track for Q2 2023 in line with original plans;

· Smelter anticipated to ramp up to full production capacity by mid 2023 with strong demand for Ironveld's suite of speciality metal products; and

· Additional revenues expected from DMS Magnetite joint venture, also due around mid 2023.

Martin Eales, CEO, said: "I am very pleased with the progress we made over the half year period to December 2022 and have already made so far this year. The coming months are due to bring many more positive developments as we build up production at the smelter and make progress with our other projects."

For further information, please contact:

Notes to Editors:

Ironveld (IRON.LN) is the owner of Mining Rights over approximately 28 kilometres of outcropping Bushveld magnetite with a SAMREC compliant ore resource of some 56 million tons of ore grading 1,12% V2O5, 68,6% Fe2O3 and 14,7% TiO2.

In 2022 Ironveld agreed to acquire and refurbish a smelter facility in Rustenburg, South Africa, in which it can process its magnetite ore into the marketable products of high purity iron, titanium slag and vanadium slag. This transaction became unconditional in March 2023.

Ironveld is an AIM traded company. For further information on Ironveld please refer to www.ironveld.com.

Chairman's Statement:

This was a transformational period for the Company. In July 2022, Ironveld announced that it had conditionally raised gross proceeds of £4.50 million via a Placing of new ordinary shares at 0.30 pence per share and the transaction was approved by shareholders in August 2022. The net funds from the Placing were applied to the acquisition out of Business Rescue and refurbishment of the smelter facility in Rustenburg, South Africa, previously owned by Ferrochrome Furnaces (Pty) Limited ("FCF"), for which the Company had agreed purchase terms in May 2022. The Sale and Purchase Agreement in respect of the acquisition was signed on 31 August 2022 and the Debt Purchase Agreement with the sole creditor was signed on 1 November 2022. The acquisition became unconditional on 29 March 2023.

In mid-August 2022, Ironveld's team commenced its six to nine month work programme to refurbish the smelter and the Company was able to announce that production from the first of three planned operating furnaces had been achieved in January 2023. Alongside the rapid progress at the smelter, Ironveld's subsidiary, Ironveld Mining (Pty) Limited ("Ironveld Mining"), commenced preparatory work for mining activities in the fourth quarter of 2022, and operations are now underway to provide required magnetite ore to the smelter on a continuous basis.

The total number of employees across the Ironveld Group reflected this rapid expansion in activities, increasing from 9 South Africa based employees as at 30 June 2022 to 130 as at 31 December 2022, a development of which we are justifiably proud.

We remain committed to operating responsibly, working closely with stakeholders and local communities at grassroots level to improve standards of living. Under the terms of the 'Social and Labour Plans' ("SLPs") that Ironveld Mining has had approved by the South African Department of Mineral Resources and Energy alongside our existing mining rights, Ironveld Mining has undertaken to fund and address local infrastructure requirements in the areas in which we operate. These improvements include: water supply to local municipalities; electrification and electricity upgrades; and roads and stormwater infrastructure. In addition, Ironveld Mining has committed to provide training, bursaries and employment to the various host communities. 

Financial

Administrative expenses totalling £581,000 (H1 2021: £384,000) were incurred in the period reflecting a return to normalised levels of expenditure compared to the comparable period, the commencement of operational activities in the fourth quarter of 2022 and the costs associated with a General Meeting requisitioned by a shareholder.

The Group recorded a loss before tax of £522,000 (H1 2021: loss of £382,000), broadly in line with Administrative expenses. The Company does not plan to pay a dividend for the six months ended 31 December 2022.

There were no borrowings at the period end (30 June 2022: borrowings of £499,000) as all outstanding balances were settled either in cash or by the issue of new shares in August 2022.

Post Period End Events

As noted above, first production was achieved at the Rustenburg smelter in January 2023. 

In February 2023, the Company announced an equity Placing to raise gross proceeds of £2.0 million at a price of 0.30p, and this was approved by shareholders in March 2023.

In March 2023 the Company announced that the acquisition of FCF had become unconditional.

Transactions with Grosvenor

Ironveld announced two agreed investment transactions with Grosvenor Resources (Pty) Limited ("Grosvenor") in late 2021. Company updates since that date have noted that Grosvenor was in talks to finalise its own funding to complete the agreed transactions, and that Grosvenor has also been in regular and open dialogue with the Company. As at today's date, the Company is aware that talks with potential funders remain ongoing and the Board believes that a financing offer has a good chance of being made however, given the changes in Ironveld's position since the original agreements with Grosvenor were signed, any financing offer will be assessed on its merits and its potential to create value for all shareholders.

Going concern

Given the recent cash inflow from the equity Placing and the commencement of sales from the smelter, the Directors have a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future being 12 months from the date of the approval of these interim financial statements in the absence of any further funding and therefore present these accounts on a Going Concern basis.

Outlook

There is a great deal to look forward to in 2023. We anticipate securing first sales from the smelter in the second quarter and reaching full operational production capacity around the middle of the year, with the Company now fully funded to achieve this. There is strong demand from customers for all of our three products of high purity iron, vanadium slag and titanium slag. In addition, Ironveld Mining will benefit from its joint venture with Pace SA to produce and sell DMS grade magnetite from the mine in mid 2023.

In due course the Company also anticipates investing in further equipment at the smelter to upgrade the high purity iron product to powder form, which will significantly enhance revenues, and is seeking innovative ways to finance this expansion.

We would like to thank all of our shareholders for their continuing support for both the Company and the Project and we look forward to providing further updates in the near future.

Giles Clarke

Chairman

30 March 2023

IRONVELD PLC

CONSOLIDATED INCOME STATEMENT

FOR THE PERIOD ENDED 31 DECEMBER 2022

IRONVELD PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 31 DECEMBER 2022

IRONVELD PLC

CONSOLIDATED BALANCE SHEET

AS AT 31 DECEMBER 2022

The accompanying notes form an integral part of these financial statements.

IRONVELD PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 31 DECEMBER 2022

IRONVELD PLC

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIOD ENDED 31 DECEMBER 2022

IRONVELD PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31 DECEMBER 2022

1 Basis of preparation and accounting policies

The results for the six months to 31 December 2022 have been prepared under International Financial Reporting Standards (IFRS) as adopted by the EU and International Accounting Standards Board.

The accounting policies are consistent with those of the annual financial statements for the year ended 30 June 2022, as described in those financial statements.

The financial information does not constitute statutory accounts as defined by section 435 of the Companies Act 2006. Full accounts of the company for the year ended 30 June 2022 on which the Auditors gave an unqualified report, have been delivered to the Registrar of Companies.

2 Loss per share

The calculation of basic and diluted loss per share is based upon the loss for the period and the weighted average number of ordinary shares in issue during the period.

Where the Group reports a loss for any period, then in accordance with IAS 33, the share options and warrants in issue are not considered dilutive.

3 Registered office and copies of the report

The registered office is Ironveld plc, Unit D De Clare House Sir Alfred Owen Way, Pontygwindy Industrial Estate, Caerphilly, Wales, CF83 3HU and copies of this report are available from the registered office.

IRONVELD PLC

OFFICERS, ADVISORS AND AGENTS

Directors: Giles Clarke (Chairman) Martin Eales (Chief Executive Officer)

Nick Harrison (Non-Executive Director)

Peter Cox (Technical Director)

John Wardle (Non-Executive Director)

Secretary: Brian James

Company Number: 04095614 (England and Wales)

Registered Office: Ironveld Plc

Unit D De Clare House Sir Alfred Owen Way

Pontygwindy Industrial Estate

Caerphilly Wales CF83 3HU

Nominated Advisor finnCap Ltd

One Bartholomew Close

London EC1A 7BL

Joint Broker finnCap Ltd

One Bartholomew Close

London EC1A 7BL

Joint Broker Turner Pope 8 Frederick's Place

London EC2R 8AB

Solicitors: Kuit Steinart Levy LLP

3 St Marys Parsonage

Manchester M3 2RD

Auditors: Crowe U.K. LLP 55 Ludgate Hill London EC4M 7JW

Bankers: HSBC

97 Bute Street

Cardiff CF10 5NA

Registrars: Link Asset Services

10th Floor Central Square

29 Wellington Street

Leeds LS1 4DL

Financial PR BlytheRay

4 - 5 Castle Court

London EC3V 9DL