Share Name Share Symbol Market Type Share ISIN Share Description
Serabi Gold Plc LSE:SRB London Ordinary Share GB00BG5NDX91 ORD 10P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 81.00 80.00 82.00 81.00 81.00 81.00 44,397 08:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Mining 33.9 -3.8 -8.8 - 48

Serabi Gold plc Unaudited Interim Financial Results For The Three And Six Month Periods To 30 June 2019 And Management's Disc...

14/08/2019 7:00am

UK Regulatory (RNS & others)


 
TIDMSRB 
 
 
   For immediate release 
 
   14 August 2019 
 
   Serabi Gold plc 
 
   ("Serabi" or the "Company") 
 
   Unaudited Interim Financial Results for the three and six month periods 
to 30 June 2019 and Management's Discussion and Analysis 
 
   Serabi Gold (AIM:SRB, TSX:SBI), the Brazilian focused gold mining and 
development company, today releases its unaudited interim financial 
results for the three and six month periods ending 30 June 2019 and at 
the same time has published its Management's Discussion and Analysis for 
the same period. 
 
   FINANCIAL HIGHLIGHTS 
 
 
   -- EBITDA for the second quarter of U$3.3 million up 23% on the same quarter 
      in 2018. 
 
   -- EBITDA for the year to date of US$7.6 million up 35% on the same period 
      in 2018. 
 
   -- Profit before tax of US$3.4 million for the year to date with earnings 
      per share of 2.92 cents. 
 
   -- Cash holdings at the end of June 2019 of US$12.4 million an increase of 
      US$3.1 million since the end of 2018. 
 
   -- AISC for the year to date of US$1,085 per ounce with a Cash Cost of 
      US$860 per ounce. 
 
   -- Operational cash flow for the second quarter of US$3.0 million (US$2.3 
      million after mine development costs), compared with US$1.4 million 
      (US$0.3 million after mine development costs) for the same period in 
      2018. 
 
   -- Operational cash flow for the year to date of US$9.4 million (US$7.9 
      million after mine development costs), compared with US$4.5 million 
      (US$2.5 million after mine development costs) for the same period in 
      2018. 
 
   -- Higher level of capital expenditure for the second quarter reflects 
      US$0.8 million for the ore sorter. 
 
 
   Key Financial Information 
 
 
 
 
                                     6 months     3 months      6 months      3 months 
                                        to            to           to            to 
                                      30 June      30 June       30 June       30 June 
                                       2019          2019         2018          2018 
                                        US$          US$           US$           US$ 
Revenue                              29,585,739   12,459,699    25,700,634    11,873,783 
Cost of sales                      (19,164,989)  (7,803,002)  (17,272,887)   (7,783,786) 
Gross operating profit               10,420,750    4,656,697     8,427,747     4,089,997 
Administration and share based 
 payments                           (2,803,500)  (1,378,996)   (2,780,485)   (1,422,883) 
EBITDA                                7,617,250    3,277,701     5,647,262     2,667,114 
Depreciation and amortisation 
 charges                            (4,250,501)  (1,960,956)   (4,490,900)   (2,498,047) 
Operating profit / (loss) before 
 finance and tax                      3,366,749    1,316,745     1,156,362       169,067 
 
Profit / (loss) after tax             1,719,640      169,678     (482,634)     (493,420) 
Earnings per ordinary share 
 (basic)                                  2.92c        0.29c       (1.10c)       (0.94c) 
 
Average gold price received            US$1,287     US$1,292      US$1,309      US$1,296 
 
                                                                     As at         As at 
                                                                   30 June   31 December 
                                                                      2019          2018 
                                                                       US$           US$ 
Cash and cash equivalents                                       12,366,683     9,216,048 
Net assets                                                      71,452,748    69,110,287 
 
Cash Cost and All-In Sustaining 
 Cost ("AISC") 
--------------------------------- 
                                                    6 months      6 months     12 months 
                                                  to 30 June            to            to 
                                                        2019       30 June   31 Dec 2018 
                                                                      2018 
Gold production for cash cost                     19,691 ozs    18,751 ozs    37,108 ozs 
 and AISC purposes 
 
Total Cash Cost of production                         US$860        US$861        US$821 
 (per ounce) 
Total AISC of production (per                       US$1,085      US$1,121      US$1,093 
 ounce) 
 
 
   OPERATIONAL AND DEVELOPMENT HIGHLIGHTS 
 
 
   -- Second quarter gold production of 9,527 ounces of gold, resulting in 
      total production for the year to date of approximately 19,700 ounces, a 
      five per cent improvement over the same period in 2018. 
 
   -- Total ore mined for the quarter of 44,784 tonnes at 6.72 grams per tonne 
      ("g/t") of gold. 
 
   -- 43,711 tonnes of run of mine ("ROM") ore were processed through the plant 
      from the combined Palito and Sao Chico orebodies, with an average grade 
      of 6.72 g/t of gold. 
 
   -- 2,419 metres of horizontal development completed during the quarter, a 
      30% increase on our Q1 figure 
 
   -- Commencement of Company's Preliminary Economic Assessment (PEA) on the 
      Coringa Gold Project, following last quarter's updated mineral resource 
      estimate.  Results of the study are expected before the end of August 
      2019. 
 
   -- The Company maintains its 2019 production guidance of 40,000 - 44,000 
      ounces representing a significant improvement on 2018 production of 
      37,108 ounces. 
 
 
   Key Operational Information 
 
 
 
 
                                                 SUMMARY PRODUCTION STATISTICS TO DATE FOR 
                                                    2019 AND FOR THE 2018 CALAR YEAR 
                                  Qtr 1   Qtr 2   Total   Qtr 1   Qtr 2   Qtr 3   Qtr 4    Total 
-----------------------  ------- 
                                   2019    2019    2019    2018    2018    2018    2018    2018 
-----------------------  ------- 
 
Gold production 
 (1) (2)                 Ounces   10,164   9,527  19,691   9,188   9,563   8,101  10,256   37,108 
 
Mined ore -- 
 Total                   Tonnes   42,609  44,784  87,393  39,669  36,071  42,725  44,257  162,722 
 Gold 
  grade 
  (g/t)                             7.47    6.72    7.08    7.49    8.12    6.23    7.45     7.29 
 
Milled ore               Tonnes   43,451  43,711  87,162  43,145  38,155  41,405  45,548  168,253 
 Gold 
  grade 
  (g/t)                             7.69    6.72    7.21    7.04    7.71    6.11    7.39     7.06 
 
Horizontal development 
 -- Total                Metres    1,868   2,419   4,287   2,353   2,744   2,814   2,460   10,371 
 
 
   1. Gold production figures are subject to amendment pending final agreed 
      assays of the gold content of the copper/gold concentrate and gold 
      doré that is delivered to the refineries. 
 
   2. Gold production totals for 2019 include treatment of 10,892 tonnes of 
      flotation tails at a grade of 4.38 g/t (2018 full year: 16,466 tonnes at 
      3.71g/t) 
 
   3. The table may not sum due to rounding. 
 
 
   Copies of the Financial Statements and the MD&A can be accessed from the 
Company's website using the following links 
 
 
   -- Financial Statements - https://bit.ly/31EWvDx https://bit.ly/31EWvDx 
 
   -- MD&A - https://bit.ly/2KMl3Dt https://bit.ly/2KMl3Dt 
 
 
   Mike Hodgson, CEO of Serabi commented: 
 
   "This second quarter has again been very pleasing from an operational 
perspective.  As we reported in our second quarter operational update on 
22 July, we were very close to achieving our third successive quarter of 
producing more than 10,000 ounces. The financial performance for this 
second quarter represents a significant improvement the same quarter in 
2018 when gold production levels were very similar and notwithstanding 
that in the same quarter in 2018, the average gold price that we 
achieved was in fact slightly higher that we received in the second 
quarter of 2019. 
 
   "Cash generated during the second quarter from the operations, after 
allowing for on-going mine development costs, was US$2.3 million which 
was US$2.0 million more than for the same quarter in 2018.  Whilst below 
the level achieved during the first quarter of 2019, it should be 
remembered that during the first two months of 2019 the cash position 
received a significant boost through the sales generated from the 
inventory held at the end of December 2018. The Group's cash holdings 
have nonetheless increased slightly compared to the position at the end 
of March 2019, which is after the purchase in the period of US$1.1 
million of plant and equipment, including US$800,000 relating to the 
final purchase payment for the ore-sorter and the importation taxes that 
were levied in Brazil. 
 
   "With the slightly lower level of production during this second quarter, 
compared to the first quarter of 2019, our AISC has crept up slightly 
but still represents an improvement compared with 2018 and, with the 
recent improvements in the gold price, the Board expects to continue to 
enjoy a good operating margin for the rest of the year.  Compared with 
the same period in 2018 total operating costs for the quarter of US$7.8 
million are comparable with the same quarter in 2018, but the margin 
improvement has been driven by the increased level of sales made during 
the quarter which at 9,667 ounces were eight per cent higher that the 
same period in 2018. 
 
   "This gold price improvement has however impacted on the financial 
expenses for the period.  The implied value of gold call options that 
the Company granted to its secured lender in July 2017 has increased and 
resulted in a revaluation charge of US$427,000 for the six months to 30 
June 2019.  In all other respects our cost profile quarter on quarter is 
remaining fairly steady. 
 
   "We announced earlier this month the expected timetable for our 
consultants to complete their work on the Preliminary Economic 
Assessment on Coringa ("PEA").  As we had previously advised, in the 
wake of the concerns regarding mine tailings dams we have taken the 
decision to switch to a dry stacking solution and dispense with a 
conventional tailings dam.  Our consultants Global Resource Engineering 
("GRE") have assisted with the test-work, design, equipment 
specifications and location of the dry stacked tailings solution and the 
revisions necessary in the process design flow sheet. This has impacted 
on the ability to progress the PEA at the pace that we had previously 
hoped, but in all other respects the Coringa project continues to be 
advancing and steady progress is being made in securing the permits and 
licences that will put us in a position to commence the project 
development. 
 
   "Our current operations continue to perform well and July was another 
very good month of production keeping us on track to meet our annual 
production guidance." 
 
   SERABI GOLD PLC 
 
   Condensed Consolidated Statements of Comprehensive Income 
 
 
 
 
                                               For the three months        For the six months 
                                                       ended                      ended 
                                                      30 June                    30 June 
                                                2019         2018          2019          2018 
(expressed in US$)                    Notes  (unaudited)  (unaudited)  (unaudited)   (unaudited) 
CONTINUING OPERATIONS 
Revenue                                       12,459,699   11,873,783    29,585,739    25,700,634 
Cost of sales                                (7,803,002)  (7,983,786)  (19,664,989)  (17,472,887) 
Release of inventory impairment 
 provision                                            --      200,000       500,000       200,000 
Depreciation and amortisation 
 charges                                     (1,960,956)  (2,498,047)   (4,250,501)   (4,490,900) 
Gross profit                                   2,695,741    1,591,950     6,170,249     3,936,847 
Administration expenses                      (1,415,133)  (1,357,814)   (2,798,964)   (2,689,238) 
Share-based payments                            (65,486)     (78,278)     (130,971)     (155,571) 
Gain on sales of assets disposal                 101,623       13,209       126,435        64,324 
Operating profit                               1,316,745      169,067     3,366,749     1,156,362 
Foreign exchange (loss) / 
 gain                                           (51,486)    (498,543)      (66,103)     (555,633) 
Finance expense                           2    (849,336)    (109,145)   (1,123,599)     (699,518) 
Finance income                            2      159,600           --       161,817            34 
Profit / (loss) before taxation                  575,523    (438,621)     2,338,864      (98,755) 
Income tax expense                        3    (405,845)     (54,799)     (619,224)     (383,879) 
Profit / (loss) after taxation                   169,678    (493,420)     1,719,640     (482,634) 
 
Other comprehensive income 
 (net of tax) 
Items that may be reclassified subsequently 
 to profit or loss 
Exchange differences on translating 
 foreign operations                            1,053,943  (8,925,573)       491,850   (9,260,004) 
Total comprehensive profit 
 /(loss) for the period operations 
 attributable to the owners 
 of the parent                                 1,223,621  (9,418,993)     2,211,490   (9,742,638) 
 
Profit / (loss) per ordinary 
 share (basic) (1)                        4        0.29c      (0.94c)         2.92c       (1.10c) 
Profit / (loss) per ordinary 
 share (diluted) (1)                      4        0.28c      (0.94c)         2.85c       (1.10c) 
 
 
   (1)           All revenue and expenses arise from continuing operations. 
 
   SERABI GOLD PLC 
 
   Condensed Consolidated Balance Sheets 
 
 
 
 
                                     As at         As at         As at 
                                    30 June       30 June     31 December 
                                      2019          2018          2018 
(expressed in US$)                (unaudited)   (unaudited)    (audited) 
Non-current assets 
Deferred exploration costs          29,591,753    24,490,001    27,707,795 
Property, plant and equipment       41,228,338    42,049,417    42,342,102 
Taxes receivable                     1,556,125     1,556,129     1,555,170 
Deferred taxation                    2,008,732     2,276,588     2,162,180 
Total non-current assets            74,384,948    70,372,135    73,767,247 
Current assets 
Inventories                          6,898,033     5,827,745     8,511,474 
Trade and other receivables          1,291,505     1,596,978       758,209 
Prepayments and accrued 
 income                              4,706,018     3,398,201     4,166,916 
Cash and cash equivalents           12,366,683    21,052,325     9,216,048 
Total current assets                25,262,239    31,875,249    22,652,647 
Current liabilities 
Trade and other payables             7,389,818     5,050,232     6,273,321 
Interest bearing liabilities         6,282,184     5,774,122     4,302,798 
Acquisition payment outstanding     11,530,027            --    10,997,757 
Derivative financial liabilities       681,765       346,992       390,976 
Accruals                               335,142       350,878       372,327 
Total current liabilities           26,059,336    11,522,224    22,337,179 
-------------------------------- 
Net current assets                   (797,097)    20,353,025       315,468 
Total assets less current 
 liabilities                        73,587,851    90,725,160    74,082,715 
Non-current liabilities 
Trade and other payables               562,627     2,233,353       955,521 
Provisions                           1,572,476     1,857,564     1,543,811 
Acquisition payment 
outstanding                                 --    10,481,843            -- 
Interest bearing liabilities                --     1,686,704     2,473,096 
Total non-current liabilities        2,135,103    16,259,464     4,972,428 
Net assets                          71,452,748    74,465,696    69,110,287 
Equity 
Share capital                        8,882,803     8,863,755     8,882,803 
Share premium reserve               21,752,430    21,681,478    21,752,430 
Option reserve                       1,106,017     1,189,318     1,363,367 
Other reserves                       5,590,190     5,066,796     4,763,819 
Translation reserve               (40,315,273)  (40,459,572)  (40,807,123) 
Retained surplus                    74,436,581    78,123,921    73,154,991 
Equity shareholders' funds          71,452,748    74,465,696    69,110,287 
 
 
   The interim financial information has not been audited and does not 
constitute statutory accounts as defined in Section 434 of the Companies 
Act 2006. Whilst the financial information included in this announcement 
has been compiled in accordance with International Financial Reporting 
Standards ("IFRS") this announcement itself does not contain sufficient 
financial information to comply with IFRS.  The Group statutory accounts 
for the year ended 31 December 2018 prepared under IFRS as adopted in 
the EU and with IFRS and their interpretations adopted by the 
International Accounting Standards Board have been filed with the 
Registrar of Companies following their adoption by shareholders at the 
2019 Annual General Meeting. The auditor's report on these accounts was 
unqualified.  The auditor's report did not contain a statement under 
Section 498 (2) or 498 (3) of the Companies Act 2006. 
 
   SERABI GOLD PLC 
 
   Condensed Consolidated Statements of Changes in Shareholders' Equity 
 
 
 
 
(expressed in US$) 
                          Share      Share     Share option  Other reserves  Translation    Retained       Total 
(unaudited)              capital     premium      reserve          (1)          reserve      Earnings     equity 
Equity shareholders' 
 funds at 31 December 
 2017                   5,540,960   1,722,222     1,425,024       4,015,369  (31,199,568)   79,266,705   60,770,712 
Foreign currency 
 adjustments                   --          --            --              --   (9,260,004)           --  (9,260,004) 
Profit for the 
 period                        --          --            --              --            --    (482,634)    (482,634) 
Total comprehensive 
 income for the 
 period                        --          --            --              --   (9,260,004)    (482,634)  (9,742,638) 
 Transfer to taxation 
  reserve                      --          --            --       1,051,427            --  (1,051,427)           -- 
 Shares issued in 
  period                3,322,795  19,959,256            --              --            --           --   23,282,051 
Share options lapsed 
 in period                     --          --     (391,277)              --            --      391,277           -- 
Share option expense           --          --       155,571              --            --           --      155,571 
Equity shareholders' 
 funds at 30 June 
 2018                   8,863,755  21,681,478     1,189,318       5,066,796  (40,459,572)   78,123,921   74,465,696 
Foreign currency 
 adjustments                   --          --            --              --     (347,551)           --    (347,551) 
Loss for the period            --          --            --              --            --  (4,968,930)  (4,968,930) 
Total comprehensive 
 income for the 
 period                        --          --            --              --     (347,551)  (4,968,930)  (5,316,481) 
 Transfer to taxation 
  reserve                      --          --            --       (302,977)            --                 (302,977) 
 Shares issued in 
  period                   19,048      70,952            --              --            --           --       90,000 
Share option expense           --          --       174,049              --            --           --      174,049 
Equity shareholders' 
 funds at 31 December 
 2018                   8,882,803  21,752,430     1,363,367       4,763,819  (40,807,123)   73,154,991   69,110,287 
Foreign currency 
 adjustments                   --          --            --              --       491,850           --      491,850 
Profit for the 
 period                        --          --            --              --            --    1,719,640    1,719,640 
Total comprehensive 
 income for the 
 period                        --          --            --              --       491,850    1,719,640    2,211,490 
 Transfer to taxation 
  reserve                      --          --            --         826,371            --    (826,371)           -- 
Share options lapsed 
 in period                     --          --     (388,321)              --            --      388,321           -- 
Share option expense           --          --       130,971              --            --           --      130,971 
Equity shareholders' 
 funds at 30 June 
 2019                   8,882,803  21,752,430     1,106,017       5,590,190  (40,315,273)   74,436,581   71,452,748 
 
 
   1. Other reserves comprise a merger reserve of US$361,461 and a taxation 
      reserve of US$5,228,729 (31 December 2018: merger reserve of US$361,461 
      and a taxation reserve of US$4,402,358). 
 
 
 
   SERABI GOLD PLC 
 
   Condensed Consolidated Cash Flow Statements 
 
 
 
 
                                                For the three months       For the six months 
                                                        ended                     ended 
                                                       30 June                   30 June 
                                                 2019         2018         2019          2018 
(expressed in US$)                            (unaudited)  (unaudited)  (unaudited)  (unaudited) 
Operating activities 
Post tax (loss) / profit for period               169,678    (493,420)    1,719,640     (482,634) 
Depreciation -- plant, equipment and 
 mining properties                              1,960,956    2,498,047    4,250,501     4,490,900 
Net financial expense                             741,222      607,688    1,027,885     1,165,117 
Provision for impairment of inventory                  --    (200,000)    (500,000)     (200,000) 
Provision for taxation                            405,845       54,799      619,224       383,879 
Share-based payments                               65,486       78,278      130,971       245,571 
Foreign exchange (loss) / gain                  (404,652)      222,774    (382,801)       154,350 
Changes in working capital 
 (Increase)/decrease in inventories             (572,470)    (619,967)    2,165,340       117,146 
 (Increase) in receivables, prepayments 
  and accrued income                            (376,417)  (1,003,947)  (1,113,022)   (1,503,295) 
 Increase/(decrease) in payables, 
  accruals and provisions                         979,894      242,933    1,518,388       113,080 
Net cash inflow from operations                 2,969,542    1,387,185    9,436,126     4,484,114 
 
Investing activities 
Acquisition payments                            (120,988)  (4,740,928)  (1,156,075)   (4,740,928) 
Capitalised mine development costs              (654,253)  (1,064,966)  (1,492,563)   (2,030,489) 
Purchase of property, plant and equipment 
 and projects in construction                 (1,071,564)    (892,233)  (1,461,292)   (1,317,926) 
Geological exploration expenditure              (208,062)  (1,443,384)    (796,524)   (2,011,802) 
Pre-operational project costs                   (403,580)    (496,049)    (843,522)   (1,289,479) 
Proceeds from sale of assets                      118,039       13,209      153,081        64,324 
Interest received                                      --           --        2,217            34 
Net cash outflow on investing activities      (2,340,408)  (8,624,351)  (5,594,678)  (11,326,266) 
 
Financing activities 
Issue of ordinary share capital                        --   23,807,346           --    23,807,346 
Costs associated with issue of share 
 capital                                               --    (566,518)           --     (566,518) 
Drawdown secured loan                                  --           --           --     3,000,000 
Repayment of secured loan                       (195,043)    (666,667)    (195,043)   (1,000,000) 
Payment of finance lease liabilities             (81,573)    (143,063)    (267,178)     (426,210) 
Interest paid and other finance costs           (151,137)    (234,166)    (303,933)     (386,587) 
Net cash (outflow) / inflow from financing 
 activities                                     (427,753)   22,196,932    (766,154)    24,428,031 
-------------------------------------------- 
 
Net increase / (decrease) in cash 
 and cash equivalents                             201,381   14,959,766    3,075,294    17,585,879 
Cash and cash equivalents at beginning 
 of period                                     12,133,712    6,695,526    9,216,048     4,093,866 
Exchange difference on cash                        31,590    (602,967)       75,341     (627,420) 
Cash and cash equivalents at end of 
 period                                        12,366,683   21,052,325   12,366,683    21,052,325 
 
 
   Notes 
 
   1. Basis of preparation 
 
   These interim condensed consolidated financial statements are for the 
three and six month period ended 30 June 2019. Comparative information 
has been provided for the unaudited three and six month period ended 30 
June 2018 and, where applicable, the audited twelve month period from 1 
January 2018 to 31 December 2018. These condensed consolidated financial 
statements do not include all the disclosures that would otherwise be 
required in a complete set of financial statements and should be read in 
conjunction with the 2018 annual report. 
 
   The condensed consolidated financial statements for the periods have 
been prepared in accordance with International Accounting Standard 34 
"Interim Financial Reporting" and the accounting policies are consistent 
with those of the annual financial statements for the year ended 31 
December 2018 and those envisaged for the financial statements for the 
year ending 31 December 2019. 
 
   Accounting standards, amendments and interpretations effective in 2019 
 
   The Group has not adopted any standards or interpretations in advance of 
the required implementation dates. 
 
   As of 1 January 2019, IFRS "16 Leases", became effective and requires 
lessees to recognise all lease assets and liabilities on the balance 
sheet for both finance leases and operating leases. The adoption of IFRS 
16 has not had any significant impact on the Group's financial 
statements as the operating leases held by the Group are of low value 
and the majority of the existing contracts either relate to service 
agreements or otherwise do not result in right of use assets or lease 
liabilities. 
 
   These financial statements do not constitute statutory accounts as 
defined in Section 434 of the Companies Act 2006. 
 
 
   1. Going concern 
 
 
   As at 30 June 2019 the Group had cash in hand of US$12.3 million and net 
assets of US$71.5 million.  The Directors have reviewed the forecast 
cash flow of the Group for the next 12 months.  Based on this forecast, 
which includes planned capital and exploration programmes, the Group may 
not be able to generate sufficient cash flows to settle, in full, the 
deferred consideration of US$12 million payable for the acquisition of 
Coringa which falls due in December 2019. 
 
   The Directors believe there is a reasonable prospect of the Group 
securing further funds as and when required in order that the Group can 
meet all liabilities including the deferred consideration payable for 
the acquisition of Coringa as and when they fall due in the next 12 
months and have prepared the financial statements on a going concern 
basis. 
 
   As at the date of this report the outcome of raising further funds 
remains uncertain and this represents a material uncertainty surrounding 
going concern. If the Group fails to raise the necessary funds the Group 
may be unable to realise its assets and discharge its liabilities in the 
normal course of business. The matters explained indicate that a 
material uncertainty exists that may cast significant doubt on the Group 
and Parent's ability to continue as a going concern. These financial 
statements do not show the adjustments to the assets and liabilities of 
the Group or the Parent company if this was to occur. 
 
   (ii)   Use of estimates and judgements 
 
   There have been no material revisions to the nature and amount of 
changes in estimates of amounts reported in the 2018 annual financial 
statements. 
 
   (iii)  Impairment 
 
   At each balance sheet date, the Group reviews the carrying amounts of 
its property, plant and equipment and intangible assets to determine 
whether there is any indication that those assets have suffered 
impairment. Prior to carrying out of impairment reviews, the significant 
cash generating units are assessed to determine whether they should be 
reviewed under the requirements of IFRS 6 - Exploration for and 
Evaluation of Mineral Resources or IAS 36 - Impairment of Assets. Such 
determination is by reference to the stage of development of the project 
and the level of reliability and surety of information used in 
calculating value in use or fair value less costs to sell. Impairment 
reviews performed under IFRS 6 are carried out on a project by project 
basis, with each project representing a potential single cash generating 
unit. An impairment review is undertaken when indicators of impairment 
arise; typically when one of the following circumstances applies: 
 
   (i)            sufficient data exists that render the resource 
uneconomic and unlikely to be developed 
 
   (ii)           title to the asset is compromised 
 
   (iii)          budgeted or planned expenditure is not expected in the 
foreseeable future 
 
   (iv)          insufficient discovery of commercially viable resources 
leading to the discontinuation of activities 
 
   Impairment reviews performed under IAS 36 are carried out when there is 
an indication that the carrying value may be impaired. Such key 
indicators (though not exhaustive) to the industry include: 
 
   (i)            a significant deterioration in the spot price of gold 
 
   (ii)           a significant increase in production costs 
 
   (iii)          a significant revision to, and reduction in, the life of 
mine plan 
 
   If any indication of impairment exists, the recoverable amount of the 
asset is estimated, being the higher of fair value less costs to sell 
and value in use. In assessing value in use, the estimated future cash 
flows are discounted to their present value using a pre-tax discount 
rate that reflects current market assessments of the time value of money 
and the risks specific to the asset for which the estimates of future 
cash flows have not been adjusted. 
 
   If the recoverable amount of an asset (or cash-generating unit) is 
estimated to be less than its carrying amount, the carrying amount of 
the asset (or cash-generating unit) is reduced to its recoverable 
amount. Such impairment losses are recognised in profit or loss for the 
year. 
 
   Where an impairment loss subsequently reverses, the carrying amount of 
the asset (or cash-generating unit) is increased to the revised estimate 
of its recoverable amount, but so that the increased carrying amount 
does not exceed the carrying amount that would have been determined had 
no impairment loss been recognised for the asset (or cash-generating 
unit) in prior years. A reversal of an impairment loss is recognised in 
profit or loss for the year. 
 
   2. Finance Costs 
 
 
 
 
                                                                                6 months 
                              3 months ended  3 months ended  6 months ended      ended 
                               30 June 2019    30 June 2018    30 June 2019    30 June 2018 
                                (unaudited)     (unaudited)     (unaudited)    (unaudited) 
                                   US$             US$             US$             US$ 
Interest expense on secured 
 loan                              (150,956)       (205,479)       (300,540)      (357,899) 
Unwinding of discount on 
 acquisition payment               (270,750)       (246,137)       (532,271)      (483,883) 
Arrangement fee for secured 
 loan                                     --              --              --       (90,000) 
Loss on revaluation of 
 derivatives                       (427,630)              --       (290,788)             -- 
Amortisation of fair value 
 of derivatives                           --        (65,000)              --      (130,000) 
                                   (849,336)       (516,616)     (1,123,599)    (1,061,782) 
Gain on revaluation of 
 derivatives                              --         407,471              --        362,264 
                                     159,000              --         159,000             -- 
Interest income                           --              --           2,217             34 
Net finance expense                (689,736)       (109,145)       (961,782)      (699,484) 
 
 
   3. Taxation 
 
   The Group has recognised a deferred tax asset to the extent that the 
Group has reasonable certainty as to the level and timing of future 
profits that might be generated and against which the asset may be 
recovered.  The Group has released the amount of US$502,707 as a 
deferred tax charge during the six month period to 30 June 2019. 
 
   The Group has also incurred a tax charge in Brazil for the six month 
period of US$116,517. 
 
   4. Earnings per share 
 
 
 
 
                               3 months ended  3 months ended  6 months ended  6 months ended 
                                30 June 2019    30 June 2018    30 June 2019    30 June 2018 
                                 (unaudited)     (unaudited)     (unaudited)     (unaudited) 
Profit / (loss) attributable 
 to ordinary shareholders 
 (US$)                                169,678       (493,420)       1,719,640       (482,634) 
Weighted average ordinary 
 shares in issue                   58,909,551      52,529,475      58,909,551      43,821,118 
Basic profit / (loss) 
 per share (US cents)                   0.29c          (0.94)           2.92c          (1.10) 
Diluted ordinary shares 
 in issue                       60,430,473(1)   52,529,475(1)   60,430,473(2)   43,821,118(1) 
Diluted profit / (loss) 
 per share (US cents)                   0.28c         (0.94c)           2.85c         (1.10c) 
 
 
   1. As the effect of dilution is to reduce the loss per share, the diluted 
      shares in issue are the same as the basic shares in issue and the diluted 
      loss per share is considered to be the same as the basic loss per share. 
 
   2. Based on 1,520,922 options vested and exercisable as at 30 June 2019. 
 
 
   Enquiries: 
 
 
 
 
Serabi Gold plc 
Michael Hodgson                Tel: +44 (0)20 7246 6830 
Chief Executive                Mobile: +44 (0)7799 473621 
 
Clive Line                     Tel: +44 (0)20 7246 6830 
Finance Director               Mobile: +44 (0)7710 151692 
 
Email: contact@serabigold.com 
----------------------------- 
Website: www.serabigold.com 
----------------------------- 
 
Beaumont Cornish Limited 
 Nominated Adviser and 
 Financial Adviser 
Roland Cornish                 Tel: +44 (0)20 7628 3396 
Michael Cornish                Tel: +44 (0)20 7628 3396 
 
Peel Hunt LLP 
 UK Broker 
Ross Allister                  Tel: +44 (0)20 7418 9000 
James Bavister                 Tel: +44 (0)20 7418 9000 
 
 
   Copies of this announcement are available from the Company's website at 
https://www.globenewswire.com/Tracker?data=NROkkZ_wNvdgku7e2LC3uICQDM9xIxcylS98Kqc54W18Fut5nIZosigLHd-i5Tk9ziyOTmY_-7KC7S1-xDJ1qwbE9GUPaaqBpDE13ryk2rw= 
www.serabigold.com. 
 
   Neither the Toronto Stock Exchange, nor any other securities regulatory 
authority, has approved or disapproved of the contents of this 
announcement. 
 
   The Company will, in compliance with Canadian regulatory requirements, 
post the Unaudited Interim Financial Statements and the Management 
Discussion and Analysis for the three and six month periods ended 30 
June 2019 on SEDAR at 
https://www.globenewswire.com/Tracker?data=NROkkZ_wNvdgku7e2LC3uHVQWRmU4q2kAU5m3y3Grk1QLSu1B_5yGl2shD--WOyHHBJ8GfDDaIJW8xCUdBmVrg== 
www.sedar.com.  These documents will also available from the Company's 
website -- 
https://www.globenewswire.com/Tracker?data=NROkkZ_wNvdgku7e2LC3uGieHAzpqIX5WtLCFL3wTLEin92ucocTP_Mh8vWVps3HvANTrf9h5wd1InzmJDdbRdrpzevDiSuafaFZtUOZNXY= 
www.serabigold.com. 
 
   Serabi's Directors Report and Financial Statements for the year ended 31 
December 2018 together the Chairman's Statement and the Management 
Discussion and Analysis, are available from the Company's website -- 
https://www.globenewswire.com/Tracker?data=NROkkZ_wNvdgku7e2LC3uADImNRyyXK_rXtR12nUhG_i0KDzTx4AOwMnlRj8TYvnjq6JEqDreybWmgJfWNH8GYNez4Y-L_nGQccvfu1YWGw= 
www.serabigold.com and on SEDAR at 
https://www.globenewswire.com/Tracker?data=NROkkZ_wNvdgku7e2LC3uCAWG-Cm02gbGiRtHi8ENAWVz_If_uv4bYD7LVPdgm4nNgGA2uz5piOi1k8hcoBMxQ== 
www.sedar.com. 
 
   This announcement is inside information for the purposes of Article 7 of 
Regulation 596/2014. The person who arranged for the release of this 
announcement on behalf of the Company was Clive Line, Director. 
 
   GLOSSARY OF TERMS 
 
   The following is a glossary of technical terms: 
 
   "Au" means gold. 
 
   "assay" in economic geology, means to analyse the proportions of metal 
in a rock or overburden sample; to test an ore or mineral for 
composition, purity, weight or other properties of commercial interest. 
 
   "development" - excavations used to establish access to the mineralised 
rock and other workings. 
 
   "doré -- a semi-pure alloy of gold silver and other metals produced 
by the smelting process at a mine that will be subject to further 
refining. 
 
   "DNPM" is the Departamento Nacional de Produção Mineral. 
 
   "grade" is the concentration of mineral within the host rock typically 
quoted as grammes per tonne (g/t), parts per million (ppm) or parts per 
billion (ppb). 
 
   "g/t" means grammes per tonne. 
 
   "granodiorite" is an igneous intrusive rock similar to granite. 
 
   "igneous" is a rock that has solidified from molten material or magma. 
 
   "Intrusive" is a body of igneous rock that invades older rocks. 
 
   "on-lode development" - Development that is undertaken in and following 
the direction of the Vein. 
 
   "mRL" -- depth in metres measured relative to a fixed point -- in the 
case of Palito and Sao Chico this is sea-level.  The mine entrance at 
Palito is at 250mRL. 
 
   "saprolite" is a weathered or decomposed clay--rich rock. 
 
   "stoping blocks" -- a discrete area of mineralised rock established for 
planning and scheduling purposes that will be mined using one of the 
various stoping methods. 
 
   "Vein" is a generic term to describe an occurrence of mineralised rock 
within an area of non-mineralised rock. 
 
   Qualified Persons Statement 
 
   The scientific and technical information contained within this 
announcement has been reviewed and approved by Michael Hodgson, a 
Director of the Company. Mr Hodgson is an Economic Geologist by training 
with over 26 years' experience in the mining industry. He holds a BSc 
(Hons) Geology, University of London, a MSc Mining Geology, University 
of Leicester and is a Fellow of the Institute of Materials, Minerals and 
Mining and a Chartered Engineer of the Engineering Council of UK, 
recognising him as both a Qualified Person for the purposes of Canadian 
National Instrument 43-101 and by the AIM Guidance Note on Mining and 
Oil & Gas Companies dated June 2009. 
 
   Forward Looking Statements 
 
   Certain statements in this announcement are, or may be deemed to be, 
forward looking statements. Forward looking statements are identi ed by 
their use of terms and phrases such as "believe", "could", "should" 
"envisage", "estimate", "intend", "may", "plan", "will" or 
the negative of those, variations or comparable expressions, including 
references to assumptions. These forward looking statements are not 
based on historical facts but rather on the Directors' current 
expectations and assumptions regarding the Company's future growth, 
results of operations, performance, future capital and other 
expenditures (including the amount, nature and sources of funding 
thereof), competitive advantages, business prospects and opportunities. 
Such forward looking statements re ect the Directors' current beliefs 
and assumptions and are based on information currently available to the 
Directors. A number of factors could cause actual results to differ 
materially from the results discussed in the forward looking statements 
including risks associated with vulnerability to general economic and 
business conditions, competition, environmental and other regulatory 
changes, actions by governmental authorities, the availability of 
capital markets, reliance on key personnel, uninsured and underinsured 
losses and other factors, many of which are beyond the control of the 
Company. Although any forward looking statements contained in this 
announcement are based upon what the Directors believe to be reasonable 
assumptions, the Company cannot assure investors that actual results 
will be consistent with such forward looking statements. 
 
   ENDS 
 
 
 
 

(END) Dow Jones Newswires

August 14, 2019 02:00 ET (06:00 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

1 Year Serabi Gold Chart

1 Year Serabi Gold Chart

1 Month Serabi Gold Chart

1 Month Serabi Gold Chart
Your Recent History
LSE
SRB
Serabi Gol..
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20191121 02:02:55