4 Mar 2016 07:00
AIM ANNOUNCEMENT | 4 March 2016 |
FINANCIAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2015
Metminco Limited (ASX: MNC; AIM: MNC) is pleased to announce that it has today released its Financial Report for the year ended 31 December 2015.
A summary of the Financial Report is set out below. The full report can be accessed from the below link:
http://www.rns-pdf.londonstockexchange.com/rns/0346R_-2016-3-4.pdf
FINANCIAL SUMMARY
The Consolidated Group after tax loss for the full year ended 31 December 2015, including an impairment of A$43,480,520 for the Mollacas Project and a provision of A$2,825,214 in relation to associated VAT receivable in Chile, was A$49,070,767.
In light of the decision by the Chilean Supreme Court to uphold a prior ruling by the Court of Appeal of Region IV, which overturned a decision granting access for mining purposes to Hampton Chile, from a lower court, the Directors are now in the process of evaluating other alternatives to secure mining access rights. Whilst the Directors believe the Mollacas Project has value, as a result of the uncertainty surrounding the timing of obtaining the mining access rights, and the impact this has on the timing of further developing the project, the Directors have considered the requirements of the relevant accounting standards and have determined that there are impairment indicators. There are a number of critical assumptions where the Directors are unable, at this stage, to accurately make an assessment and as such are unable to measure the recoverable amount, other than for the value of the land and water rights. Accordingly the Company has impaired the value of the Mollacas Project by $43.5m, down to a recoverable amount of A$3.9m being the value of the land and water rights owned by the Company. Further, the Company has provided in full for recoverable VAT in Chile, which is recoverable against VAT received on sales and/or export credits, due to the uncertainty pertaining to the timing of recovery following the delayed development of the Mollacas Project.
Funding
During the year the Company raised approximately A$5.3 million net costs (A$0.3 million through a placing completed in March 2015 ("Mar15 Placing"), pro-rata right issue and placement of the corresponding shortfall ("May 15 Right Issue"), a placing completed in November 2015 ("Nov15 Placing") and exercise of options associated with the Mar15 Placing and the May15 Rights Issue.
Mar15 Placing
The Company raised approximately A$1 million through the issue of 179,191,151 new fully paid ordinary shares ("Shares") at a issue price of A$0.006 (£0.003) per Share. The Mar 15 Placing, which comprised two tranches, (75,335,833 Shares under ASX Listing Rule 7.1 and 103,855,318 Shares approved by shareholders at a general meeting of shareholders) granted participants an unlisted option to acquire an additional Share at A$0.006 (£0.003) per Share no later than 3 calendar months after the date of issue. All Directors participated in the Mar 15 Placing subscribing for a total of 54,375,000 Shares to raise approximately A$325,000.
Directors' and Management of the Company exercised 33,358,334 options at A$0.006 (GBP£0.003) per Share prior to expiry to raise A$200,150.
May 15 Right Issue
A pro-rata rights issue offer ("May 15 Rights Issue") of 565,631,686 Shares was made to shareholders with a registered address in Australia, United Kingdom or New Zealand. The May 15 Rights Issue, which was on the basis of 1 fully paid ordinary share ("New Share") for every 3.25 Shares held on 10 April 2015 at an issue price of A$0.005 (£0.0026) per New Share, raised A$2.8 million with 100% of entitlements being taken up. Under the May 15 Rights Issue subscribers were also granted one unlisted May 16 Rights Issue Option per New Share exercisable at A$0.005 (£0.0026) expiring 15 May 2016.
As at 31 December 2015 option holders had exercised 43,135,227 May 16 Rights Issue Options raising A$215,676.
Nov15 Placing
A total of 250,000,000 Shares were placed by SPAngel at a price of A$0.00433 (£0.002) per Share under ASX Listing Rule 7.1 and 7.1A, raising approximately A$1.1 (£0.50) million before costs.
Shares Issued in lieu of termination payment and fees
A total of 48,503,379 Shares equivalent to A$231,135 were issued in settlement of termination payment (20,045,258 Shares equivalent to A$ 111,135 to a former employee) and in lieu of fees (21,156,558 Shares equivalent to A$90,000 to LinQ Corporate Pty Ltd in settlement of corporate consulting fees and 7,301,562 Shares equivalent to A$30,000 to Slipstream Resources Pty Ltd for investor relations related services).
Strategic Alliance
Following the release of the Strategic Mining Study, the Company commenced a process seeking to secure a strategic partner for the Los Calatos Project with a number of parties working through their due diligence. The process is taking longer than anticipated, mainly due to current market conditions.
Until the Company secures an offer that secures real value for shareholders, there is a need to maintain the Los Calatos Project in good standing. Against a global backdrop of robust long term copper demand, depleting copper reserves, and given both its location and environmental disposition, the Los Calatos Project is a valuable asset which has the potential to be an important future copper producer.
Cash Position
As at 31 December 2015 Metminco had cash reserves of A$0.95 million.
Expenditure for the year was focussed on the Company's 100% owned Los Calatos copper project. At Los Calatos, following completion of detailed geological modelling of the deposit and an updated Mineral Resources Estimate, the Company engaged Runge Pincock Minarco to undertake the Strategic Mining Study completed September 2015 (refer Los Calatos section above). The updated Mineral Resources Estimate and the results of the Strategic Mining Study has attracted the interest of several potential funding partners and with whom the Company is currently in discussions. Additional geological interpretative surface mapping leading to identification of the TD2.
The Company also incurred expenditure in relation to evaluation of potential near term cash flow acquisition opportunities, maintaining its other project in good standing, ASX and AIM listing and governance related expenditure and overheads.
Consolidated statement of PROFIT Or Loss and Other COMPREHENSIVE INCOME FOR THE Year ENDED 31 December 2015
| Note | CONsolidated Group | |
|
| 31 December 2015$ | 31 December 2014$ |
|
|
|
|
Revenue | 2 | 4,445 | 10,135 |
Foreign exchange (loss)/gain |
| (74,202) | (610,084) |
Administration expenses |
| (1,152,533) | (1,991,226) |
Corporate expenses |
| (655,191) | (1,131,966) |
Occupancy expense |
| (260,984) | (297,523) |
Exploration and evaluation expenditure impaired | 13 | (43,480,520) | (7,204,568) |
Exploration, evaluation and due diligence expenses |
| (626,568) | (1,697,706) |
Provision for Chilean VAT receivable | 9 | (2,825,214) | - |
Loss before income tax |
| (49,070,767) | (12,922,938) |
Income tax expense | 4 | - | - |
Loss for the year | 3 | (49,070,767) | (12,922,938) |
Other comprehensive income |
|
|
|
Items that may be reclassified subsequently to profit or loss: |
|
|
|
Exchange differences on translating foreign controlled entities (net of tax) |
| 8,617,997
| 6,146,533
|
Total Comprehensive Loss for the year |
| (40,452,770) | (6,776,405) |
|
|
|
|
Loss for the year attributable to members of the parent entity: |
| (49,070,767) | (12,922,938) |
Total comprehensive lossattributable to members of the parent entity: |
|
|
|
From continuing operations: |
| (40,452,770) | (6,776,405) |
|
|
|
|
Basic loss per share (cents) | 7 | (2.04) | (0.73) |
Diluted loss per share | 7 | (2.04) | (0.73) |
.
Consolidated statement of FINANCIAL POSITIONAS AT 31 December 2015
| Note | CONsolidated Group | |
|
| 31 December 2015$ | 31 December 2014$ |
ASSETS |
|
|
|
CURRENT ASSETS |
|
|
|
Cash and cash equivalents | 8 | 949,790 | 1,192,693 |
Trade and other receivables | 9 | 186,858 | 316,471 |
Other assets | 10 | 21,815 | 30,990 |
TOTAL CURRENT ASSETS |
| 1,158,463 | 1,540,154 |
|
|
|
|
NON-CURRENT ASSETS |
|
|
|
Trade and other receivables | 9 | 2,180,893 | 4,878,723 |
Property, plant and equipment | 12 | 4,586,160 | 4,124,135 |
Exploration and evaluation expenditure | 13 | 160,886,215 | 193,531,440 |
TOTAL NON-CURRENT ASSETS |
| 167,653,268 | 202,534,298 |
TOTAL ASSETS |
| 168,811,731 | 204,074,452 |
|
|
|
|
LIABILITIES |
|
|
|
CURRENT LIABILITIES |
|
|
|
Trade and other payables | 14 | 317,058 | 472,705 |
Short term provisions | 15 | 258,225 | 308,888 |
TOTAL CURRENT LIABILITIES |
| 575,283 | 781,593 |
|
|
|
|
NON-CURRENT LIABILITIES |
|
|
|
Long term provisions | 15 | 83,155 | 47,224 |
TOTAL NON-CURRENT LIABILITIES |
| 83,155 | 47,224 |
TOTAL LIABILITIES |
| 658,438 | 828,817 |
NET ASSETS |
| 168,153,293 | 203,245,635 |
|
|
|
|
EQUITY |
|
|
|
Issued capital | 16 | 324,037,464 | 318,677,036 |
Reserves | 25 | (18,208,268) | (26,640,427) |
Accumulated losses |
| (137,675,903) | (88,790,974) |
TOTAL EQUITY |
| 168,153,293 | 203,245,635 |
COnsolidated statement of CHANGES IN EQUITYFOR THE Year ENDED 31 December 2015
| Issued Capital | Accumulated Losses | Option Reserve | Foreign Currency Translation Reserve | Acquisition Reserve | Total |
CONSOLIDATED GROUP | $ | $ | $ | $ | $ | $ |
Total equity as at 1 Jan 2014 | 317,607,678 | (79,104,278) | 3,435,147 | 8,466,108 | (41,506,662) | 208,897,993 |
Loss attributable to members of the parent entity | - | (12,922,938) | - | - | - | (12,922,938) |
Other comprehensive income | - | - | - | 6,146,533 | - | 6,146,533 |
Total comprehensive loss | - | (12,922,938) | - | 6,146,533 | - | (6,776,405) |
Transactions with owners: |
|
|
|
|
|
|
Shares issued during the period | 1,402,130 | - | - | - | - | 1,402,130 |
Transaction costs | (332,772) | - | - | - | - | (332,772) |
Options expired | - | 3,236,242 | (3,236,242) | - | - | - |
Options issued during the period | - | - | 54,689 | - | - | 54,689 |
Balance as at 31 December 2014 | 318,677,036 | (88,790,974) | 253,594 | 14,612,641 | (41,506,662) | 203,245,635 |
|
|
|
|
|
|
|
Total equity as at 1 Jan 2015 | 318,677,036 | (88,790,974) | 253,594 | 14,612,641 | (41,506,662) | 203,245,635 |
Loss attributable to members of the parent entity | - | (49,070,767) | - | - | - | (49,070,767) |
Other comprehensive income | - | - | - | 8,617,997 | - | 8,617,997 |
Total comprehensive loss | - | (49,070,767) | - | 8,617,997 | - | (40,452,770) |
Transactions with owners: |
|
|
|
|
|
|
Shares issued during the period | 5,625,590 | - | - | - | - | 5,625,590 |
Transaction costs | (265,162) | - | - | - | - | (265,162) |
Options expired | - | 185,838 | (185,838) | - | - | - |
Balance as at 31 December 2015 | 324,037,464 | (137,675,903) | 67,756 | 23,230,638 | (41,506,662) | 168,153,293 |
Consolidated statements OF CASH FLOWSFOR THE YEAR ENDED 31 December 2015
| Note | CONSOLIDATED GROUP | |
|
| 31 December 2015$ | 31 December 2014$ |
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
Payments to suppliers and employees |
| (1,988,210) | (3,158,424) |
Exploration, due diligence and evaluation |
| (626,569) | (1,697,706) |
Interest received |
| 4,445 | 10,135 |
Net cash used in operating activities | 21(b) | (2,610,334) | (4,845,995) |
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
Purchase of plant and equipment |
| (3,977) | (13,553) |
Payments for exploration expenditure |
| (2,928,374) | (2,641,877) |
Recovery of VAT in Peru |
| 13,555 | 372,161 |
Net cash used in investing activities |
| (2,918,796) | (2,283,269) |
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
Proceeds from issue of shares |
| 5,625,590 | 1,136,173 |
Payments in respect to capital raisings |
| (265,162) | (12,127) |
Net cash provided by financing activities |
| 5,360,428 | 1,124,046 |
|
|
|
|
Net decrease in cash held |
| (168,702) | (6,005,218) |
|
|
|
|
Cash and cash equivalents at the beginning of the year |
| 1,192,693 | 7,807,995 |
Effect of exchange rates on cash holdings in foreign currencies |
| (74,201) | (610,084) |
Cash and cash equivalents at the end of the year
| 21(a) | 949,790 | 1,192,693 |
For further information, please contact:
METMINCO LIMITED |
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Stephen Tainton / Phil Killen |
| Office: +61 (0) 2 9460 1856 |
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NOMINATED ADVISOR AND BROKER |
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RFC Ambrian |
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Australia |
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Will Souter / Nathan Forsyth |
| Office: +61 (0) 2 9250 0000 |
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United Kingdom |
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Samantha Harrison / Charlie Cryer |
| Office: +44 (0) 20 3440 6800 |
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JOINT BROKER |
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SP Angel Corporate Finance LLP UK) |
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Ewan Leggat |
| Office: +44 (0) 20 3470 0470 |