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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mineral & Financial Investments Limited | LSE:MAFL | London | Ordinary Share | KYG6181G1055 | ORD 1P (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -1.00 | -8.33% | 11.00 | 10.50 | 11.50 | 12.40 | 11.00 | 12.00 | 100,052 | 12:02:11 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Metal Mining Services | 2.39M | 1.55M | 0.0420 | 2.62 | 4.06M |
From Apr 2019 to Apr 2024
TIDMMAFL
RNS Number : 1126F
Mineral & Financial Invest. Limited
05 March 2020
Mineral & Financial Investments Limited
Interim Results (unaudited) for the Six Months Ended 31 December 2019
HIGHLIGHTS:
-- Unaudited net earnings for the first 6 months of the fiscal 2020 period were GBP247K or 0.7p per share
-- NAV per share at Dec 31, 2019 up 22.2% vs. same period last year, to 15.19p -- The 3 Year Compound Annual Growth rate of the NAV per share is 34.4% -- Strong Improvement in Pound Sterling neutralized most NAV gains vs Q1 achieved in the period -- The Company is debt free, with a good cash balance and a strong Working Capital position
-- Post period end publication of the Preliminary Economic Assessment of Lagoa Salgada indicates a Pre-tax NPV(@8%) of US$137m (details below)
GEORGE TOWN CAYMAN ISLANDS, March 5, 2020 - Mineral and Financial Investments Limited (LSE-AIM: MAFL) ("M&FI" or the "Company") is very pleased to announce its unaudited interim results for the six months ended 31 December 2019.
Chairman's Statement:
The Company generated a profit after-tax of GBP247K and a fully diluted EPS gain of 0.71p per share compared to a profit after-tax of GBP722K and a fully diluted EPS gain of 2.0p per share in the same period last year. The NAV per share increased 22.2% from 31(st) December 2018 to 15.19p or GBP5,361K, a new high for M&FI.
The Company retains a cash position of GBP364K. This continued NAV growth was in spite of market headwinds in the areas in which we invest, particularly from the weak zinc prices and the strengthening of the British pound. The British pound appreciated markedly during the quarter (+7.3% against the US dollar and 5.6% against the Canadian dollar), which we believe was in part due to Brexit negotiations and in part due to the Conservative Party's strong majority achieved in the December 2019 election in the UK. As we report in GBP, but invest mostly in USD, this has had a negative effect on our results. We also believe our investment in Ascendant Resources Inc. ("Ascendant") is adversely affected by the weak performance of Zinc prices. Although recently LME zinc inventories have increased to about 75,000 tonnes, they remain significantly below the 600,000 tonnes inventory levels of 2016 (see www.lme.com). We believe that the long-term fundamentals to zinc remain positive and, as such, we remain committed to and optimistic about our investment stance.
We were also delighted to announce the results of the Preliminary Economic Assessment ("PEA") for the Lagoa Salgada project, after the period end. The project is 85% owned by Redcorp Empreedimentos Mineiros Lda ("Redcorp"), of which M&FI currently owns 75%. M&FI has an earn-in agreement with Ascendant, for Ascendant to acquire up to 80% of Redcorp subject to milestones and payments (see RNS dated 2 August 2018). The PEA, completed only on LS North, concludes that the project could achieve a pre-tax Internal Rate of Return, using an 8% discount rate, of 37% over its mine life of 9.0 years. The estimate Life of Mine Cash Flow (pre-tax) is US$250 million. Further details of this PEA including the key highlights and sensitivities are set out in the announcement dated 14 January 2020. It is important to note that LS North deposit is but part of the mineralization zone at Lagoa Salgada. We believe that the overall tonnage of the project will increase with further exploration drilling and all or part of LS Central and LS South will ultimately be converted in the Measured and Indicated category, although there can be no guarantee that this will occur.
Your company's portfolio is overweight in precious metals and therefore could benefit from the rally in their prices since the end of Q2. Additionally, as our concerns about general market valuations have grown we have acquired a position in ProShares UltraPro Short ETF. The position cost us some performance in Q2, but in February 2020 they have rallied from $16 to $23.76, as at the writing of this statement.
The following is a summary of the NAV, updated to include the unaudited NAV calculation:
Hot Features
Premium
31 Dec 31 Dec 30 Jun 30 Jun 31 Dec 31 Dec CAGR (%)
2016 2017 2018 2019 2018 2019
FYE FYE FYE FYE Q2 Q2 2019/2016
--------
NET ASSET VALUE (NAV)
(,000) GBP1,494 GBP2,603 GBP2,623 GBP5,114 GBP4,393 GBP5,361 53.1%
-------- -------- -------- -------- -------- -------- ----------
NET ASSET VALUE PER
SHARE (NAVPS FD) 6.25p 7.43p 7.49p 14.50p 12.54p 15.19p 34.4%
-------- -------- -------- -------- -------- -------- ----------
Tactical Portfolio:
The purpose of the Tactical Portfolio is to allow M&FI flexibility to take advantage of short-term opportunities across asset classes in high quality names, whilst remaining liquid enough to deploy working capital elsewhere when needed. We took a view on gold in early 2018 which we continue to reflect in the more recent portfolio additions of Newmont and VanEck Vectors Gold Miners during the period. During the period under review, gold rose 3.3% and silver 5% again outperforming base metals, which with the exception of copper +7%, suffered a 17% slump in Nickel prices after a sharp rally and Indonesia lifted some export restrictions. We believe our addition of a Copper ETF to the portfolio in the previous quarter has been validated and that our gold exposure is rewarding. Whilst we sold a couple of smaller positions, we expect some strength to return to the junior end of the market over time. Barrick shares performed well but were eclipsed by Teranga Gold rising 33% in the quarter. Teranga has continued to deliver on plan, declaring commercial production at Wahgnion and at the upper end of expectations for 2019 production. This performance was balanced by our position in Ascendant as mentioned above and the strengthening British pound against the Canadian dollar which also had a negative effect on the value of our holding in Trevali Mining.
The Tactical Portfolio, as at December 31, 2019, includes:
Company Development Type of Security Primary Commodity Geographic
Stage Area of Activities
Artemis Resources Exploration Common Equity Gold Australia
------------ ----------------- ------------------ --------------------
Ascendant Resources Production Common Equity Zinc & Lead Honduras &
Portugal
------------ ----------------- ------------------ --------------------
Barrick Gold Production Common Equity Gold Global
------------ ----------------- ------------------ --------------------
Cabral Gold Exploration Common Equity Gold Brazil
------------ ----------------- ------------------ --------------------
Cerrado Gold Exploration Common Equity Gold Brazil
------------ ----------------- ------------------ --------------------
Fresnillo PLC Production Common Equity Silver Latin America
------------ ----------------- ------------------ --------------------
Newmont Goldcorp Production Common Equity Gold Global
------------ ----------------- ------------------ --------------------
Resolute Mining Production Common Equity Gold Australia,
W.Africa
------------ ----------------- ------------------ --------------------
ProShares UltraPro N/A ETF 3x Short USA
Short ETF S&P 500
------------ ----------------- ------------------ --------------------
Teranga Gold Production Common Equity Gold West Africa
------------ ----------------- ------------------ --------------------
Trevali Mining Production Common Equity Zinc & Lead Global
------------ ----------------- ------------------ --------------------
VanEck Vectors N/A ETF Gold Global
Gold Miners
------------ ----------------- ------------------ --------------------
Victoria Gold Corp Production Common Equity Gold Canada
------------ ----------------- ------------------ --------------------
Gold N/A ETF Gold Global
------------ ----------------- ------------------ --------------------
Silver N/A ETF Silver Global
------------ ----------------- ------------------ --------------------
Copper N/A ETF Copper Global
------------ ----------------- ------------------ --------------------
Strategic Portfolio:
After the period end, we were pleased to announce the Preliminary Economic Assessment of the Lagoa Salgada project completed by AMC Mining Consultants on behalf of Ascendant, this assessment specifically only focused on the north zone. The PEA reports the project is economic estimating a pre-tax IRR of 37% using 8% NAV, and $250m cash flow during its estimated 9 year life (more details of this assessment are set out in the announcement of 14 January 2020). During the period under review we continued to support two other holdings, Golden Sun Resources and Cerrado Gold. We supported Cerrado Gold in its latest financing valuing the company at $0.50 per share vs $0.45 per share previously. We hold 1.5% of Cerrado whose Monte do Carmo project in Brazil has an early stage estimated IRR in excess of 30% and an NPV at 10% in excess of $140m (NPV at 5% is $195m) according to the independent scoping study completed by PEK (details available on Cerrado's website (www.cerradogold.com)), NPV's and IRR's are based on specific assumptions which are indicative of the project's potential but may or may not be achieved.
The Strategic Portfolio allows M&FI to assess the three key fundamentals to a successful investment in the sector: management, finance and geology. We can change the first two of these and so we exercise in depth due diligence on geology. As such we are constantly reviewing potential investments filtering through the many underfunded projects left struggling by 10yrs of underperformance. The Board continues to like zinc and gold which is well represented in both portfolios and is reviewing investments in other commodities with the potential to outperform.
M&FI are currently reviewing several other investment opportunities. The directors look forward to providing shareholders with more information on all the investments, in due course if they progress. Several of these opportunities are private.
The Strategic Portfolio, as at December 31, 2019, includes:
Company Development Type of Security Primary Commodity Geographic Area
Stage of Activities
Redcorp Empreedimentos Exploration Common Equity Zn, Pb, Cu, Portugal
Mineiros Lda. Au, Ag
------------ ----------------- ------------------ -----------------
Cap Energy Exploration Common Equity Oil & Gas Senegal & Guinea
Bis.
------------ ----------------- ------------------ -----------------
Cerrado Gold Exploration Common Equity Gold Brazil
------------ ----------------- ------------------ -----------------
Golden Sun Mining Production Convertible Gold Costa Rica
loan
------------ ----------------- ------------------ -----------------
On behalf of the Board
Jacques Vaillancourt, Executive Chairman
FOR MORE INFORMATION:
Katy Mitchell and Matthew Chan, WH Ireland Limited +44 207 220 1666 Jon Belliss, Novum Securities Limited +44 207 399 9400 James Lesser, Mineral & Financial Investments Ltd. +44 777 957 7216
Statement of comprehensive Income
for the 6 months ended 31 December 2019
UNAUDITED UNAUDITED AUDITED
6 months 6 months 12 months
to to to
31 December 31 December 30 June
2019 2018 2019
Note GBP'000 GBP'000 GBP'000
------------------------------------ ------ ------------- ------------- ------------
Continuing operations:
Investment income 1 - 28
Fee revenue - - 212
Net gains on investments 399 838 2,414
Total income 400 838 2,654
Operating expenses (144) (116) (280)
Other gains and losses (9) - 161
-------------------------------------------- ------------- ------------- ----------
Profit before taxation 247 722 2,535
Taxation expense - - (44)
-------------------------------------------- ------------- ------------- ------------
Profit for the period attributable
to owners of the Company 247 722 2,491
Earnings per share attributable
to owners of the Company during pence pence pence
the period 3
Basic: 0.7 2.1 7.1
Diluted: 0.7 2.0 7.1
-------------------------------------------- ------------- ------------- ------------
Statement of Financial Position
as at 31 December 2019
UNAUDITED UNAUDITED AUDITED
31 December 31 December 30 June
2019 2018 2019
GBP'000 GBP'000 GBP'000
---------------------------------- ------------ ------------ ---------
CURRENT ASSETS
Financial assets 5,105 3,679 4,952
Trade and other receivables 70 19 78
Cash and cash equivalents 364 750 224
----------------------------------- ------------ ------------ ---------
5,539 4,448 5,254
---------------------------------- ------------ ------------ ---------
CURRENT LIABILITIES
Trade and other payables 126 45 88
Convertible unsecured loan notes 10 10 10
----------------------------------- ------------ ------------ ---------
55 55 98
---------------------------------- ------------ ------------ ---------
NET CURRENT ASSETS 5,413 4,393 5,156
----------------------------------- ------------ ------------ ---------
NON-CURRENT LIABILITIES
Deferred tax provision (42) - (42)
NET ASSETS 5,361 4,393 5,114
----------------------------------- ------------ ------------ ---------
EQUITY
Share capital 3,095 3,095 3,095
Share premium 5,886 5,886 5,886
Loan note equity reserve 6 6 6
Share option reserve 23 23 23
Other reserves 15,736 15,736 15,736
Retained earnings (19,385) (20,353) (19,632)
----------------------------------- ------------ ------------ ---------
SHAREHOLDERS' EQUITY 5,361 4,393 5,114
----------------------------------- ------------ ------------ ---------
Statement of Changes in equity
for the 6 months ended 31 December 2019
Share
Share Share Loan note option Other Accumulated Total
capital premium reserve reserve reserves losses equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- -------- -------- --------- -------- --------- ----------- -------
At 30 June 2018 3,092 5,866 6 23 15,736 (22,123) 2,623
-------------------- -------- -------- --------- -------- --------- ----------- -------
Profit for the 6
months to
31 December 2018 - - - - - 722 722
-------------------- -------- -------- --------- -------- --------- ----------- -------
Acquisition of TH
Crestgate - - - - - 1,048 1,048
At 31 December 2018 3,095 5,886 6 23 15,736 (20,353) 4,393
Profit for the 6
months to
30 June 2019 - - - - - 721 721
-------------------- -------- -------- --------- -------- --------- ----------- -------
At 30 June 2019 3,095 5,886 6 23 15,736 (19,632) 5,114
-------------------- -------- -------- --------- -------- --------- ----------- -------
Profit for the 6
months to
31 December 2019 - - - - - 247 247
-------------------- -------- -------- --------- -------- --------- ----------- -------
At 31 December 2019 3,095 5,886 6 23 15,736 (19,385) 5,361
-------------------- -------- -------- --------- -------- --------- ----------- -------
Statement of Cash flow
for the 6 months ended 31 December 2019
UNAUDITED UNAUDITED AUDITED
6 months 6 months 12 months
to to to
31 December 31 December 30 June
2019 2018 2019
GBP'000 GBP'000 GBP'000
------------------------------------- ------------- ------------- ----------
OPERATING ACTIVITIES
Profit/(loss) before taxation 247 722 2,535
Adjustments for:
Net gains on investments (399) (838) (2,414)
Other gains and losses - - (178)
Investment income (1) - (28)
Tax paid - - (2)
-------------------------------------- ------------- ------------- ----------
Operating cashflow before working
capital changes (153) (116) (87)
(Increase)/decrease in trade
and other receivables 8 (9) (58)
Increase/(de crease) in trade
and other payables 38 (23) 7
-------------------------------------- ------------- ------------- ----------
Net cash outflow from operating
activities (107) (148) (138)
-------------------------------------- ------------- ------------- ----------
INVESTING ACTIVITIES
Purchase of financial assets (474) (188) (865)
Disposal of financial assets 720 664 587
Acquisition of subsidiary - - (97)
Cash balance of subsidiary acquired - - 287
Investment income 1 - 28
Net cash (outflow)/inflow from
investing activities 247 476 (60)
-------------------------------------- ------------- ------------- ----------
Net increase/( decrease) in
cash and cash equivalents 140 328 (198)
Cash and cash equivalents at
start of period 224 422 422
C ash and cash equivalents at
end of period 364 750 224
-------------------------------------- ------------- ------------- ----------
Notes to the unaudited interim statement
for the 6 months ended 31 December 2019
1. General information
The Company is a limited company quoted on AIM, a market of the London Stock Exchange, and is registered in the Cayman Islands.
The address of its registered office is 190 Elgin Avenue, George Town , Grand Cayman , KY1-9005, Cayman Islands . The financial statements are presented in Pound s Sterling which is the Company's functional and presentational currency.
2. Basis of preparation
The interim financial statements of Mineral & Financial Investments Limited have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and on the historical cost basis using the accounting policies which are consistent with those set out in the Company's Annual Report and Accounts for the year ended 30 June 2019.
This interim financial information for the 6 months to 31 December 2019 was approved by the board on 4 March 2019.
The unaudited interim financial information for the 6 months to 31 December 2019 does not constitute statutory accounts. The comparative figures for the year ended 30 June 2019 are extracted from the statutory financial statements which contain an unqualified audit report.
3. Earnings per share
The basic and diluted earnings per share is calculated by
dividing the profit/(loss) attributable to owners of the Company
by the weighted average number of ordinary shares in issue
during the year.
6 months 6 months 12 months
to to to
31 December 31 December 30 June
2019 2018 2019
GBP'000 GBP'000 GBP'000
------------------------------- ------------- ------------- -----------
Weighted average number of
shares for calculating basic
earnings per share 35,037,895 35,037,895 35,037,895
Weighted average number of
shares for calculating fully
diluted earnings per share 35,527,895 35,842,895 35,527,895
------------------------------- ------------- ------------- -----------
4. The interim report is available to view and download from the Company's website: www.mineralandfinancial.com
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR GZGGFVKGGGZG
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