REG - Atalaya Mining PLC - Q2 and H1 2024 Financial Results
14/08/2024 07:00
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RNS Number : 3346A Atalaya Mining PLC 14 August 2024
14 August 2024
Atalaya Mining Plc.
("Atalaya" or "the Company")
Q2 and H1 2024 Financial Results
Good financial performance and further progress at key growth projects
Atalaya Mining Plc (LSE: ATYM) is pleased to announce its unaudited second
quarter and first half financial results for the period ended 30 June 2024
("Q2 2024" and "H1 2024" respectively) together with its unaudited interim
condensed consolidated financial statements.
Highlights
· Copper production of 11.6 kt in Q2 2024 and 22.2 kt in H1 2024,
with increased grades and strong plant performance expected in H2 2024
· AISC of $3.20/lb Cu in Q2 2024 and $3.19/lb in H1 2024, despite
lower grades
· EBITDA of €26.4 million in Q2 2024 and €36.7 million in H1
2024, benefitting from higher copper prices and good cost control in H1 2024
· Strong balance sheet to support the advancement of key growth
projects, including San Dionisio, Proyecto Touro and Proyecto Masa Valverde
· 2024 interim dividend of US$0.04 per ordinary share declared
· Continued to progress the re-domiciliation to Spain which is
expected to be completed in Q4 2024, following move to the Main Market in
April 2024
Q2 and H1 2024 Financial Results Summary
Period ended 30 June Unit Q2 2024 Q2 2023 H1 2024 H1 2023
Revenues from operations €k 92,208 78,223 162,146 169,394
Operating costs €k (65,781) (62,517) (125,468) (129,283)
EBITDA €k 26,427 15,706 36,678 40,111
Profit for the period €k 14,520 9,204 16,147 20,308
Basic earnings per share € cents/share 10.8 6.8 12.2 15.0
Interim dividend declared per share((1)) $/share n/a n/a 0.04 0.05
Cash flows from operating activities €k 30,126 18,888 28,389 31,250
Cash flows used in investing activities €k (17,054) (7,929) (34,931) (16,740)
Cash flows from financing activities €k (18,862) (18,936) (35,671) (28,367)
Net cash position((2)(3)) €k 53,361 68,752 53,361 68,752
Working capital surplus €k 63,408 81,350 63,408 81,350
Average realised copper price (excluding QPs) US$/lb 4.54 3.81 4.26 3.90
Copper concentrate produced tonnes 60,623 67,931 113,308 125,600
Copper production tonnes 11,583 14,212 22,249 26,351
Cash costs US$/lb payable 2.88 2.60 2.93 2.73
All-In Sustaining Cost ("AISC") US$/lb payable 3.20 2.89 3.19 3.00
(1) Interim dividends declared in relation to the H1 2024 and H1
2023 periods.
(2) Includes restricted cash and bank borrowings at 30 June 2024 and
30 June 2023.
(3) Net cash has been restated from the amount previously reported
in the Company's Q2 Operations Update of €30.0 million.
Alberto Lavandeira, CEO, commented:
"We had good financial performance in Q2 2024 thanks to strong copper prices
and cost control. Copper grades were lower than in comparable periods, but we
expect to see an improvement in grades and strong plant performance in H2
2024.
We continue to make progress at our higher grade deposits in the Riotinto
District. Waste stripping and permitting activities at San Dionisio are
advancing in line with plans and we continue to prepare for the development of
an access ramp at Masa Valverde.
Following the receipt of Strategic Industrial Project status at Proyecto
Touro, stakeholder engagement continues and community support for the project
has been strong. Touro is expected to have a highly competitive capital
intensity and we are confident that it will become a new source of sustainable
European copper production.
We continue to be bullish on copper despite price volatility of late. Recent
M&A activity involving long-dated projects that will require significant
capital investments highlight the robust outlook for copper and the increasing
scarcity of high-quality assets."
Investor Presentation
Alberto Lavandeira (CEO) and César Sánchez (CFO) will be holding a live
presentation relating to the Q2 and H1 2024 Financial Results via the Investor
Meet Company platform on Thursday, 15 August 2024 at 11:00 BST.
To register, please visit the following link and click "Add to Meet" Atalaya
via:
https://www.investormeetcompany.com/atalaya-mining-plc/register-investor
(https://www.investormeetcompany.com/atalaya-mining-plc/register-investor)
Management will also answer questions that have been submitted via the
Investor Meet Company dashboard.
Q2 and H1 2024 Operating Results Summary
Units expressed in accordance with the international system of units (SI) Unit Q2 2024 Q2 2023 H1 2024 H1 2023
Ore mined tonnes 3,797,923 3,934,462 7,499,752 7,356,018
Waste mined((1)) tonnes 7,507,378 8,640,747 13,047,055 15,157,650
Ore processed tonnes 4,086,408 4,077,681 7,826,501 7,801,534
Copper grade % 0.33 0.40 0.33 0.39
Copper concentrate grade % 19.11 20.92 19.64 20.98
Copper recovery % 85.81 87.18 85.30 87.04
Copper concentrate produced tonnes 60,623 67,931 113,308 125,600
Copper production tonnes 11,583 14,212 22,249 26,351
Payable copper production tonnes 10,976 13,533 21,116 25,095
Cash cost US$/lb payable 2.88 2.60 2.93 2.73
All-in sustaining cost US$/lb payable 3.20 2.89 3.19 3.00
(1) Represents the Cerro Colorado pit only.
Mining
Ore mined was 3.8 million tonnes in Q2 2024 (Q2 2023: 3.9 million tonnes) and
7.5 million tonnes in H1 2024 (H1 2023: 7.4 million tonnes).
Waste mined was 7.5 million tonnes in Q2 2024 (Q2 2023: 8.6 million tonnes)
and 13.0 million tonnes in H1 2024 (H1 2023: 15.2 million tonnes). In
addition, waste stripping activities continued at the San Dionisio area as
planned.
Processing
Ore processed was 4.1 million tonnes in Q2 2024 (Q2 2023: 4.1 million tonnes)
and 7.8 million tonnes in H1 2024 (H1 2023: 7.8 million tonnes), which
represents plant performance above its 15 million tonne per annum nameplate
capacity.
Copper grade was 0.33% in Q2 2024 (Q2 2023: 0.40%) and 0.33% in H1 2024 (H1
2023: 0.39%), as a result of pit sequencing. Improved grades are expected in
H2 2024 as mining returns to the bottom of the Cerro Colorado pit.
Copper recovery was 85.81% in Q2 2024 (Q2 2023: 87.18%) and 85.30% in H1 2024
(H1 2023: 87.04%), which was consistent with budget despite lower grades.
Production
Copper production was 11,583 tonnes in Q2 2024 (Q2 2023: 14,212 tonnes) and
22,249 tonnes in H1 2024 (H1 2023: 26,351 tonnes), resulting from lower
grades.
On-site copper concentrate inventories at 30 June 2024 were approximately
8,749 tonnes.
Copper contained in concentrates sold was 11,397 tonnes in Q2 2024 (Q2 2023:
12,858 tonnes) and 21,683 tonnes in H1 2024 (H1 2023: 25,359 tonnes).
Cash Costs and AISC Breakdown
$/lb Cu payable Q2 2024 Q2 2023 H1 2024 H1 2023
Mining 1.04 0.79 1.01 0.81
Processing 0.83 0.82 0.87 0.89
Other site operating costs 0.63 0.52 0.65 0.51
Total site operating costs 2.50 2.13 2.53 2.21
By-product credits (0.23) (0.08) (0.19) (0.08)
Freight, treatment charges and other offsite costs 0.61 0.55 0.58 0.60
Total offsite costs 0.38 0.47 0.40 0.52
Cash costs 2.88 2.60 2.93 2.73
Cash costs C1 2.88 2.60 2.93 2.73
Corporate costs 0.12 0.09 0.11 0.08
Sustaining capital (excluding one-off tailings expansion) 0.05 0.04 0.03 0.03
Capitalised stripping costs((1)) 0.06 0.10 0.03 0.09
Other costs 0.09 0.06 0.08 0.07
Total AISC 3.20 2.89 3.19 3.00
(1) For the Cerro Colorado pit only.
Note: Some figures may not add up due to rounding.
Cash costs were $2.88/lb payable copper in Q2 2024 (Q2 2023: $2.60/lb) and
$2.93/lb payable copper in H1 2024 (H1 2023: $2.73/lb), with the increase
mainly due to lower copper production, although this impact was partly offset
by higher silver credits.
AISC were $3.20/lb payable copper in Q2 2024 (Q2 2023: $2.89/lb) and $3.19/lb
payable copper in H1 2024 (H1 2023: $3.00/lb), with the increase due to the
same factors that impacted cash costs. AISC excludes one-off investments in
the tailings dam (consistent with prior reporting) and waste stripping at the
San Dionisio area.
Q2 and H1 2024 Financial Results Highlights
Income Statement
Revenues were €92.2 million in Q2 2024 (Q2 2023: €78.2 million) and
€162.1 million in H1 2024 (H1 2023: €169.4 million), as higher copper
prices helped to offset lower copper sales.
Operating costs were €65.8 million in Q2 2024 (Q2 2023: €62.5 million) and
€125.5 million in H1 2024 (H1 2023: €129.3 million), highlighting a return
to stable input costs.
EBITDA was €26.4 million in Q2 2024 (Q2 2023: €15.7 million) and €36.7
million in H1 2024 (H1 2023: €40.1 million).
Profit after tax was €14.5 million in Q2 2024 (Q2 2023: €9.2 million) or
10.8 cents basic earnings per share (Q2 2023: 6.8 cents) and €16.1 million
in H1 2024 (H1 2023: €20.3 million) or 12.2 cents basic earnings per share
(Q2 2023: 15.0 cents).
Cash Flow Statement
Cash flows from operating activities before changes in working capital were
€26.8 million in Q2 2024 (Q2 2023: €14.7 million) and €30.1 million
after working capital changes (Q2 2023: €18.9 million). For H1 2024, cash
flows from operating activities before changes in working capital were €38.3
million (H1 2023: €38.9 million) and €28.4 million after working capital
changes (H1 2023: €31.3 million).
Cash flows used in investing activities were €17.1 million in Q2 2024 (Q2
2023: €7.9 million) and €34.9 million in H1 2024 (H1 2023: €16.7
million). Key investments in Q2 2024 included €1.1 million in sustaining
capex, €1.3 million in capitalised stripping at Cerro Colorado, €8.0
million related to the San Dionisio area, €4.4 million to expand the
tailings dam, €1.9 million for the 50 MW solar plant and €0.2 million for
the E-LIX Phase I Plant including ramp-up costs.
Cash flows from financing activities were negative €18.9 million in Q2 2024
(Q2 2023: negative €18.9 million) and negative €35.7 million in H1 2024
(H1 2023: negative €28.4 million) as a result of credit facility repayments.
Balance Sheet
The Company's balance sheet remains strong with unaudited consolidated cash
and cash equivalents of €81.0 million as at 30 June 2024.
Current and non-current borrowings were €27.7 million, resulting in a net
cash position of €53.4 million as at 30 June 2024, compared with €54.3
million as at 31 December 2023.
Inventories of concentrate valued at cost were €10.2 million at 30 June 2024
(31 December 2023: €8.4 million). The total working capital surplus was
€63.4 million at 30 June 2024 (31 December 2023: €68.6 million).
Outlook for 2024
Copper production guidance remains at 45,000 - 50,000 tonnes as disclosed in
the Q2 2024 Operations Update, with improved grades and strong plant
performance expected in H2 2024.
Cash cost and AISC guidance continues to be $2.80 - 3.00/lb and $3.00 -
3.20/lb copper payable, respectively. AISC guidance excludes one-off
investments in the tailings dam and ongoing waste stripping at the San
Dionisio area.
The guidance for total non-sustaining capital expenditures of €64 - 73
million is unchanged.
Exploration expenditure guidance of €5 - 7 million is unchanged.
2024 Interim Dividend
Atalaya's dividend policy seeks to provide returns to its shareholders and
allows for continued investments in its portfolio of low capital intensity
growth projects.
In relation to FY2023, Atalaya completed the payment of the 2023 Final
Dividend of US$0.04 per ordinary share on 9 August 2024.
In relation to the H1 2024 period, the Company's Board of Directors has
elected to declare an interim dividend of US$0.04 per ordinary share ("2024
Interim Dividend"), which is equivalent to approximately 3.1 pence per share.
This compares to the 2023 interim dividend of US$0.05 per ordinary share.
Shareholders can elect to receive the 2024 Interim Dividend in Sterling or
Euros by submitting a currency election form, which will be made available on
the Company's website.
2024 Interim Dividend Timetable
Event Date
Ex-dividend date 22 August 2024
Record date 23 August 2024
Last day for currency election 6 September 2024
Reference date for exchange rates used for conversion 9 September 2024
Announcement of dividend currency exchange rates 10 September 2024
Estimated payment date 19 September 2024
With respect to the 2024 Interim Dividend, the Company is not required to
withhold any Cypriot special defence contributions or general healthcare
system contributions upon the distribution of dividends to its shareholders,
as a result of the approval obtained from the Tax Department of the Ministry
of Finance of the Republic of Cyprus.
Corporate Activities Update
Move to the Main Market
On 29 April 2024, the Company announced the admission of its ordinary shares
to the premium listing segment of the Official List maintained by the
Financial Conduct Authority ("FCA") and to trading on London Stock
Exchange's main market for listed securities, along with the cancellation of
trading on AIM.
The move up marks a significant corporate milestone for Atalaya and reflects
the Company's desire to expand its investor base and continue its growth
trajectory.
Photo 1: London Stock Exchange Market Open Ceremony
Re-domiciliation
On 27 June 2024, the Company held its 2024 Annual General Meeting where
shareholders approved the new procedures required to implement the
re-domiciliation of the Company's registered office from the Republic of
Cyprus to the Kingdom of Spain.
The Company expects the re-domiciliation to be completed in Q4 2024.
Board of Director Updates
Following the 2024 Annual General Meeting, several updates related to the
Company's Board of Directors took effect.
Neil Gregson was appointed Chair of Atalaya Mining Plc, succeeding Roger Davey
who is continuing as a Non-Executive Director until the end of 2024. In
addition, Kate Harcourt was appointed Senior Independent Director, Carole
Whittall was appointed as an Independent Non-Executive Director and changes
were made to the composition of the various Board committees.
New Listing Rules
On 29 July 2024, the FCA implemented a new simplified listing regime. As a
result, the Company is now admitted to the equity shares (commercial
companies) ("ESCC") category of the Official List, in place of the prior
premium listing segment.
Asset Portfolio Update
Proyecto Riotinto
Waste stripping continues at San Dionisio in order to prepare the area for
future mining phases. Waste mined was 3.4 million tonnes in Q2 2024, compared
with 4.6 million tonnes in Q1 2024.
The Company continues to advance the permitting process associated with the
San Dionisio final pit, which represents a key component of the integrated
mine plan outlined in the 2023 Riotinto PEA.
At San Antonio, preparations are underway to begin an infill and step-out
drilling programme.
E-LIX Phase I Plant
Final construction, commissioning and ramp-up activities continue at the E-LIX
Phase I plant. The successful leaching of copper and zinc concentrates has
resulted in the production of zinc and copper precipitates and further
progress is expected during H2 2024.
Once fully operational, the E-LIX plant is expected to produce high-purity
copper or zinc metals on site, allowing the Company to potentially achieve
higher metal recoveries from complex polymetallic ores, lower transportation
and concentrate treatment charges and a reduced carbon footprint.
50 MW Solar Plant
Start-up of the 50 MW solar plant continues to be expected in late 2024. The
Company is working closely with its contractor in order to avoid further
delays in the project's schedule. Market electricity prices in 2024 have been
below long-term averages in Spain.
Once fully operational, the 50 MW solar plant is expected to provide
approximately 22% of Riotinto's current electricity needs, thereby reducing
the Company's carbon footprint. Together, the 50 MW solar plant and 10-year
PPA will provide over 50% of the Company's current electricity requirements at
a rate well below historical prices in Spain.
Riotinto District - Proyecto Masa Valverde ("PMV")
In 2023, the Company was granted the AAU and exploitation permit for PMV.
Various workstreams are ongoing including infill, geotechnical and
sterilisation drilling to support design work associated with a future ramp
and ventilation shaft. The Company expects to start construction of the access
ramp in late 2024 or early 2025.
Three core rigs are currently active and focused on step-out drilling at the
Mojarra Trend and the Masa Valverde deposit.
Proyecto Touro
On 24 June 2024, Atalaya announced that Proyecto Touro, via its local entity
Cobre San Rafael, was declared a strategic industrial project by the Council
of the Xunta de Galicia ("XdG"). Under legislation of the Autonomous
Community of Galicia, the status of strategic industrial project (or in
Spanish, Proyecto Industrial Estratégico ("PIE")) acts to simplify the
administrative procedures associated with the development of industrial
projects and intends to substantially reduce permitting timelines.
This declaration highlights the XdG's commitment to promoting new investment
that will benefit the region and also support the objectives of the European
Union. Copper is considered a strategic raw material by the EU and this
project has the potential to become a new source of sustainable European
copper production.
In the coming months, the XdG will be reviewing the various aspects of the
project according to the simplified procedures afforded to projects with PIE
status. The XdG will also begin the public information period, which serves to
inform the surrounding communities and organisations about the proposed
project.
In addition, the Company will continue to engage with the many stakeholders in
the region and restore the water quality of the rivers around Touro by
operating its water treatment plant.
Proyecto Ossa Morena
Drilling continued to progress with one rig at the Guijarro-Chaparral
gold-copper project where the first phase of the resource definition program
was completed. Subsequently, the rig was moved to the flagship
Alconchel-Pallares copper-gold project where the first hole of the 2024
campaign is in progress.
Proyecto Riotinto East
Drill testing priority coincident SkyTEM and AGG anomalies resumed during the
quarter. The first hole of the 2024 campaign was completed and a second hole
is in progress.
Financial Statements
The Unaudited Interim Condensed Consolidated Financial Statements for the
three and six months ended 30 June 2024 are also available on Atalaya's
website at www.atalayamining.com (http://www.atalayamining.com) .
Contacts:
SEC Newgate UK Elisabeth Cowell / Tom Carnegie / Matthew Elliott +44 20 3757 6882
Atalaya Mining Michael Rechsteiner +34 959 59 28 50
About Atalaya Mining Plc
Atalaya is a European copper producer that owns and operates the Proyecto
Riotinto complex in southwest Spain. Atalaya's shares trade on the London
Stock Exchange's Main Market under the symbol "ATYM".
Atalaya's operations include the Cerro Colorado open pit mine and a modern 15
Mtpa processing plant, which has the potential to become a central processing
hub for ore sourced from its wholly owned regional projects around Riotinto,
such as Proyecto Masa Valverde and Proyecto Riotinto East. In addition,
Atalaya has a phased earn-in agreement for up to 80% ownership of Cobre San
Rafael S.L., which fully owns the Proyecto Touro brownfield copper project in
the northwest of Spain, as well as a 99.9% interest in Proyecto Ossa Morena.
For further information, please visit www.atalayamining.com
(http://www.atalayamining.com)
ATALAYA MINING PLC
MANAGEMENT'S REVIEW AND
UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
30 June 2024
Management review report
Notice to Reader
The accompanying unaudited interim condensed consolidated financial statements
of Atalaya Mining Plc have been prepared by and are the responsibility of
Atalaya Mining Plc's management.
Introduction
This report provides an overview and analysis of the financial results of
operations of Atalaya Mining Plc and its subsidiaries ("Atalaya" and/or
"Group"), to enable the reader to assess material changes in the financial
position between 31 December 2023 and 30 June 2024 and results of operations
for the three and six months ended 30 June 2024 and 2023.
This report has been prepared as of 13 August 2024. The analysis hereby
included is intended to supplement and complement the unaudited interim
condensed consolidated financial statements and notes thereto ("Financial
Statements") as at and for the period ended 30 June 2024. The reader should
review the Financial Statements in conjunction with the review of this report
and with the audited, consolidated financial statements for the year ended 31
December 2023, and the audited interim condensed consolidated financial
statements for the period ended 30 June 2023. These documents can be found on
Atalaya's website at www.atalayamining.com (http://www.atalayamining.com)
Atalaya prepares its Annual Financial Statements in accordance with
International Financial Reporting Standards as adopted by the European Union
(IFRS-EU) and the interpretations of the IFRS Interpretations Committee (IFRS
IC) approved by Regulations of the European Commission, and its Unaudited
Interim Condensed Consolidated Financial Statements in accordance with
International Accounting Standard 34: Interim Financial Reporting. The
currency referred to in this document is the Euro, unless otherwise specified.
Forward-looking statements
This report may include certain "forward-looking statements" and
"forward-looking information" under applicable securities laws. Except for
statements of historical fact, certain information contained herein constitute
forward-looking statements. Forward-looking statements are frequently
characterised by words such as "plan", "expect", "project", "intend",
"believe", "anticipate", "estimate", and other similar words, or statements
that certain events or conditions "may" or "will" occur. Forward-looking
statements are based on the opinions and estimates of management at the date
the statements are made, and are based on a number of assumptions and subject
to a variety of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected in the
forward-looking statements. Assumptions upon which such forward-looking
statements are based include that all required third party regulatory and
governmental approvals will be obtained. Many of these assumptions are based
on factors and events that are not within the control of Atalaya and there is
no assurance they will prove to be correct. Factors that could cause actual
results to vary materially from results anticipated by such forward-looking
statements include changes in market conditions and other risk factors
discussed or referred to in this report and other documents filed with the
applicable securities regulatory authorities. Although Atalaya has attempted
to identify important factors that could cause actual actions, events or
results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results
not to be anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such
statements. Atalaya undertakes no obligation to update forward-looking
statements if circumstances or management's estimates or opinions should
change except as required by applicable securities laws. The reader is
cautioned not to place undue reliance on forward-looking statements.
1. Incorporation and description of the Business
Atalaya Mining Plc (the "Company") was incorporated in Cyprus on 17 September
2004 as a private company with limited liability under the Companies Law, Cap.
113 and was converted to a public limited liability company on 26 January
2005. Its registered office is at 1 Lampousa Street, Nicosia, Cyprus.
The Company was first listed on the Alternative Investment Market (AIM) of the
London Stock Exchange in May 2005, trading under the symbol ATYM. On 29 April
2024, the Company was admitted to trading on the main market of the London
Stock Exchange.
Atalaya is a European mining and development company. The strategy is to
evaluate and prioritise metal production opportunities in several
jurisdictions throughout the well-known belts of base and precious metal
mineralisation in Spain, elsewhere in Europe and Latin America.
The Group has interests in four mining projects: Proyecto Riotinto, Proyecto
Touro, Proyecto Masa Valverde and Proyecto Ossa Morena. In addition, the Group
has an earn-in agreement to acquire two investigation permits at Proyecto
Riotinto East.
Proyecto Riotinto
The Company owns and operates through a wholly owned subsidiary, "Proyecto
Riotinto", an open-pit copper mine located in the Iberian Pyrite Belt, in the
Andalusia region of Spain, approximately 65 km northwest of Seville. A
brownfield expansion of this mine was completed in 2019 and successfully
commissioned by Q1 2020.
Proyecto Touro
The Group has an initial 10% stake in Cobre San Rafael, S.L., the owner of
Proyecto Touro, as part of an earn-in agreement which will enable the Group to
acquire up to 80% of Cobre San Rafael, S.L. Proyecto Touro is located in
Galicia, north-west Spain. Proyecto Touro is currently in the permitting
process.
In November 2019, Atalaya executed the option to acquire 12.5% of
Explotaciones Gallegas del Cobre, S.L. the exploration property around Touro,
with known additional resources, which will provide further optionality to
Proyecto Touro.
Proyecto Masa Valverde
On 21 October 2020, the Company announced that it entered into a definitive
purchase agreement to acquire 100% of the shares of Cambridge Mineria España,
S.L. (since renamed Atalaya Masa Valverde, S.L.U.), a Spanish company which
fully owns the Masa Valverde polymetallic project located in Huelva (Spain).
Under the terms of the agreement Atalaya will make an aggregate €1.4 million
cash payment in two instalments of approximately the same amount. The first
payment of €0.7m was executed in January 2024 once the permits were granted.
The second and final payment will be settled when first production is achieved
from the concession.
In November 2023, the exploitation permit for the Masa Valverde and Majadales
deposits was officially granted.
Proyecto Ossa Morena
In December 2021, Atalaya announced the acquisition of a 51% interest in Rio
Narcea Nickel, S.L., which owns 9 investigation permits. The acquisition also
provided a 100% interest in three investigation permits that are also located
along the Ossa- Morena Metallogenic Belt. In Q3 2022, Atalaya increased its
ownership interest in POM to 99.9%, up from 51%, following completion of a
capital increase that will fund exploration activities. During 2022 Atalaya
rejected 8 investigation permits.
Atalaya will pay a total of €2.5 million in cash in three instalments and
grant a 1% net smelter return ("NSR") royalty over all acquired permits. The
first payment of €0.5 million will be made following execution of the
purchase agreement. The second and third instalments of €1 million each will
be made once the environmental impact statement ("EIS") and the final mining
permits for any project within any of the investigation permits acquired under
the Transaction are secured.
Proyecto Riotinto East
In December 2020, Atalaya entered into a Memorandum of Understanding with a
local private Spanish company to acquire a 100% beneficial interest in two
investigation permits (known as Peñas Blancas and Cerro Negro investigation
permits), which are located immediately to the east of Proyecto Riotinto.
2. Overview of Operational Results
Proyecto Riotinto
The following table presents a summarised statement of operations of Proyecto
Riotinto for the three and six months ended 30 June 2024 and 2023,
respectively.
Units expressed in accordance with the international system of units (SI) Unit Three month period ended 30 June 2023 Six month period ended 30 Jun 2023
Three month period ended 30 Jun 2024
Six month period ended 30 Jun 2024
Ore mined tonnes 3,797,923 3,934,462 7,499,752 7,356,018
Waste mined((1)) tonnes 7,507,378 8,640,747 13,047,055 15,157,650
Ore processed tonnes 4,086,408 4,077,681 7,826,501 7,801,534
Copper grade % 0.33 0.40 0.33 0.39
Copper concentrate grade % 19.11 20.92 19.64 20.98
Copper recovery % 85.81 87.18 85.30 87.04
Copper concentrate produced tonnes 60,623 67,931 113,308 125,600
Copper production tonnes 11,583 14,212 22,249 26,351
Payable copper production tonnes 10,976 13,533 21,116 25,095
Cash cost (*) US$/lb payable 2.88 2.60 2.93 2.73
All-in sustaining cost (*) US$/lb payable 3.20 2.89 3.19 3.00
(1) Represents the Cerro Colorado pit only.
(*) Refer Section 5 of this Management Review.
There may be slight differences between the numbers in the above table and the
preliminary figures announced in the quarterly operations updates that are
available on Atalaya's website at www.atalayamining.com
(http://www.atalayamining.com)
$/lb Cu payable Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Mining 1.04 0.79 1.01 0.81
Processing 0.83 0.82 0.87 0.89
Other site operating costs 0.63 0.52 0.65 0.51
Total site operating costs 2.50 2.13 2.53 2.21
By-product credits (0.23) (0.08) (0.19) (0.08)
Freight, treatment charges and other offsite costs 0.61 0.55 0.58 0.60
Total offsite costs 0.38 0.47 0.40 0.52
Cash costs 2.88 2.60 2.93 2.73
Cash costs C1 2.88 2.60 2.93 2.73
Corporate costs 0.12 0.09 0.11 0.08
Sustaining capital (excluding one-off tailings expansion) 0.05 0.04 0.03 0.03
Capitalised stripping costs((1)) 0.06 0.10 0.03 0.09
Other costs 0.09 0.06 0.08 0.07
Total AISC 3.20 2.89 3.19 3.00
(1) For the Cerro Colorado pit only.
Note: Some figures may not add up due to rounding.
Three months operational review
The plant processed ore of 4.1 million tonnes during Q2 2024 (Q2 2023: 4.1
million tonnes), compared with 3.7 million tonnes in Q1 2024, which represents
plant performance above its 15 million tonne per annum nameplate capacity.
Copper grade was 0.33% in Q2 2024 (Q2 2023: 0.40%), compared with 0.34% in Q1
2024, as a result of pit sequencing. Improved grades are expected in H2 2024
as mining returns to the bottom of the Cerro Colorado pit.
Copper recoveries in Q2 2024 were 85.81% (Q2 2023: 87.18%), compared with
84.74% in Q1 2024, as a result of favourable ore characteristics during the
period.
Copper production was 11,583 tonnes in Q2 2024 (Q2 2023: 14,212 tonnes),
compared with 10,666 tonnes in Q1 2024.
On-site copper concentrate inventories as of 30 June 2024 were approximately
8,749 tonnes (31 March 2024: 8,283 tonnes). All concentrate in stock at the
beginning of the period was delivered to the port of Huelva.
Copper contained in concentrates sold was 11,397 tonnes in Q2 2024 compared
with 12,858 tonnes in Q2 2023.
Six months operational review
Production of copper contained in concentrate during H1 2024 was 22,249
tonnes, compared with 26,351 tonnes in the same period of 2023. Lower
production was mainly the result of lower grades and recoveries. Payable
copper in concentrates was 21,116 tonnes compared with 25,095 tonnes of
payable copper in H1 2023.
Ore mined in H1 2024 was 7.5 million tonnes compared with 7.4 million tonnes
during H1 2023. Ore processed was 7.8 million tonnes versus 7.8 million tonnes
in H1 2023, although lower grade stockpiles were processed in H1 2024.
Ore grade during H1 2024 was 0.33% Cu compared with 0.39% Cu in H1 2023.
Copper recovery was 85.30% versus 87.04% in H1 2023. Concentrate production
amounted to 113,308 tonnes below H1 2023 production of 125,600 tonnes.
3. Outlook
The forward-looking information contained in this section is subject to the
risk factors and assumptions contained in the cautionary statement on
forward-looking statements included in the Basis of Reporting. Should the
Company consider the current guidance no longer achievable, then the Company
will provide a further update.
Operational guidance
Proyecto Riotinto operational guidance for 2024 is as follows:
Unit Guidance 2024
Ore mined million tonnes ~16
Waste mined million tonnes ~25
Ore processed million tonnes 15.3 - 15.8
Copper ore grade % 0.34 - 0.38
Copper recovery rate % 84 - 86
Contained copper tonnes 45,000 - 50,000
Cash costs $/lb payable 2.80 - 3.00
All-in sustaining cost $/lb payable 3.00 - 3.20
Production
Copper production guidance remains at 45,000 - 50,000 tonnes. The Company
continues to expect improved grades in H2 2024 as well as strong plant
performance.
Operating Costs
Operating cost guidance for FY2024 remains at a cash cost range of $2.80 -
3.00/lb copper payable and an AISC range of $3.00 - 3.20/lb copper payable.
AISC excludes one-off investments in the tailings dam (consistent with prior
reporting) and waste stripping at the San Dionisio area, which are included in
capital expenditure guidance below.
Capital Expenditures
Non-sustaining capital expenditure guidance for FY2024 remains at €64 - 73
million.
Exploration
Atalaya's exploration guidance for FY2024 is unchanged at €5 - 7 million.
4. Overview of the Financial Results
The following table presents summarised consolidated income statements for the
three and six months ended 30 June 2024, with comparatives for the three and
six months ended 30 June 2023, respectively.
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Revenues 92,208 78,223 162,146 169,394
Costs of sales (60,207) (56,790) (116,964) (119,793)
Administrative and other expenses (3,076) (3,612) (5,003) (5,645)
Exploration expenses (1,091) (2,069) (1,946) (3,602)
Care and maintenance expenditure (1,609) (391) (2,041) (686)
Other income 202 345 486 443
EBITDA 26,427 15,706 36,678 40,111
Depreciation/amortisation (10,984) (9,411) (20,590) (18,173)
Net foreign exchange gain 672 1,277 2,243 55
Net finance (cost)/income (1) 3,480 (91) 2,636
Tax (1,594) (1,848) (2,093) (4,321)
Profit for the period 14,520 9,204 16,147 20,308
Three months financial review
Revenues for the three-month period ended 30 June 2024 amounted to €92.2
million (Q2 2023: €78.2 million). Higher revenues compared with the prior
year quarter were mainly due to higher realised prices partly offset by lower
concentrate sales. In addition, there was an increase in silver credits and
lower penalty charges.
Realised prices excluding QPs were US$4.54/lb copper during Q2 2024 compared
with US$3.81/lb copper in Q2 2023. The realised price during the quarter,
including QPs, was approximately US$4.13/lb.
Cost of sales for the three-month period ended 30 June 2024 amounted to
€60.2 million, compared with €56.8 million in Q2 2023. Unit operating
costs in Q2 2024 were higher than in Q2 2023 mainly due to the increase of
stripping ratio resulting from the update of reserves estimate, coupled with a
lower capitalisation cost.
Cash costs of US$2.88/lb payable copper during Q2 2024 compared with
US$2.60/lb payable copper in the same period last year. Higher cash costs were
mainly driven by lower copper production in the quarter despite of a slightly
stronger US Dollar/Euro exchange rate compared with Q2 2023. AISC for Q2 2024,
excluding one-off investments in the tailings dam and San Dionisio stripping,
were US$3.20lb payable copper compared with US$2.89/lb payable copper in Q2
2023.
Sustaining capex for Q2 2024 amounted to €1.1 million compared with €1.1
million in Q2 2023. Sustaining capex mainly related to continuous enhancements
in the processing systems of the plant. In addition, the Company invested
€4.4 million in the project to increase the tailings dam during Q2 2024 (Q2
2023: €3.5 million). Stripping costs capitalised for Cerro Colorado during
Q2 2024 amounted to €1.3 million (Q2 2023: €2.7 million).
Capex associated with the construction of the 50 MW solar plant amounted to
€1.9 million in Q2 2024 (Q2 2023: €2.8 million), while investments in the
E-LIX Phase I plant totalled €0.2 million (Q2 2023: €5.0 million).
Additionally, capex of €8.0 million was related to the San Dionisio area.
Administrative and other expenses amounted to €3.2 million (Q2 2023: €3.6
million) and include non-operating costs of the Cyprus office, corporate legal
and consultancy costs, ongoing listing costs, officers and directors'
emoluments, and salaries and related costs of the corporate office.
Exploration costs on Atalaya's projects portfolio for the three-month period
ended 30 June 2024 amounted to €1.1 million compared to €2.1 million in Q2
2023, mainly because increased costs incurred during the period in Proyecto
Masa Valverde were capitalised rather than expensed.
EBITDA for the three months ended 30 June 2024 amounted to €26.4 million
compared with Q2 2023 of €15.7 million.
The main item below the EBITDA line is depreciation and amortisation of
€11.0 million (Q2 2023: €9.4 million).
Net foreign exchange differences had a positive impact due to the stronger US
Dollar/Euro rate at the end of Q2 2024 compared to the beginning of the
quarter.
Net financing costs for Q2 2024 were negative €1k compared to €3.5 million
in Q2 2023. This difference is driven primarily by the fact that Q2 2023
interest income included €3.8 million received from the agreement reached
with Astor in May 2023.
Six months financial review
Revenues for the six-month period ended 30 June 2024 amounted to €162.1
million (H1 2023: €169.4 million). The decrease in revenues was
predominantly due to a reduction in the volume of concentrate sold despite
higher realised copper prices.
Copper concentrate production during the six-month period ended 30 June 2024
was 113,308 tonnes (H1 2023: 125,600 tonnes) with 111,281 tonnes of copper
concentrates sold in the period (H1 2023: 122,040 tonnes). Lower copper ore
grades and lower recoveries were the main drivers of the production decline in
H1 2024. Inventories of concentrates as at the reporting date were 8,749
tonnes (31 Dec 2023: 6,722 tonnes).
Realised copper prices, excluding QPs, for H1 2024 were US$4.26/lb copper
compared with US$3.90/lb copper in the same period of 2023. The Company did
not enter into any hedging agreements in 2024.
Cost of sales for the six-month period ended 30 June 2024 amounted to €117.0
million, compared with €119.8 million in H1 2023. Lower operating costs in
2024 were primarily due to a reduction in input costs compared with the 2023
period. This was mainly driven by lower electricity prices in the market and
lower consumption and prices of steel.
Cash costs of US$2.93/lb payable copper during H1 2024 compare with US$2.73/lb
payable copper in the same period last year. Higher cash costs were mainly
driven by reduced payable copper production during the period, despite a
decrease in operating costs. AISC excluding investment in the tailings dam and
the waste stripping at the San Dionisio area in the six-month period were
US$3.19/lb payable copper compared with US$3.00/lb payable copper in H1 2023.
The increase was primarily due to higher cash costs.
Sustaining capex for the six-month period ended 30 June 2024 amounted to
€1.5 million, compared with €1.5 million in the same period the previous
year. Sustaining capex related to enhancements in processing systems of the
plant. In addition, the Company invested €7.5 million in the project to
increase the tailings dam, compared with €6.9 million in 2023.
Capex associated with the construction of the 50 MW solar plant amounted to
€2.6 million in H1 2024 (€4.5 million in H1 2023), with a total investment
in the project of €35.3 million, while investments in the E-LIX Phase I
plant totalled €6.5 million (€8.4 million in H1 2023). Additionally, capex
of €16.2 million was related to the San Dionisio area.
Corporate costs for the first six-month period ended June 2024 were €5.2
million, compared with €5.6 million in H1 2023. Corporate costs mainly
include the Company's overhead expenses.
Exploration costs related to Atalaya's project portfolio for the six-month
period ended 30 June 2024 and amounted to €1.9 million, compared with €3.6
million, mainly as a result of higher capitalised costs incurred during the
period in Proyecto Masa Valverde.
EBITDA for the six months ended 30 June 2024 amounted to €36.7 million,
compared with €40.1 million in H1 2023.
Depreciation and amortisation amounted to €20.6 million for the six-month
period ended 30 June 2024 (H1 2023: €18.2 million).
Net foreign exchange gains amounted to €2.2 million in H1 2024 (€55k in H1
2023).
Net finance costs for H1 2024 amounted to €0.1 million (H1 2023 positive
€2.6 million).
Copper prices
The average realised copper price (excluding QPs) increased by 19% to
US$4.54/lb in Q2 2024, from US$3.81/lb in Q2 2023.
The average prices of copper for the three and six month period ended 30 June
2024 and 2023 are summarised below:
$/lb Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Realised copper price (excluding QPs) 4.54 3.81 4.26 3.90
Market copper price per lb (period average) 4.42 3.85 4.13 3.95
Realised copper prices for the reporting period noted above have been
calculated using payable copper and excluding both provisional invoices and
final settlements of quotation periods ("QPs") together. The realised price
during Q2 2024, including the QP, was approximately $4.13/lb.
5. Non-GAAP Measures
Atalaya has included certain non-IFRS measures including "EBITDA", "Cash Cost
per pound of payable copper", "All-In Sustaining Costs" ("AISC") "realised
prices" and "Net Cash/Debt" in this report. Non-IFRS measures do not have any
standardised meaning prescribed under IFRS, and therefore they may not be
comparable to similar measures presented by other companies. These measures
are intended to provide additional information and should not be considered in
isolation or as a substitute for indicators prepared in accordance with IFRS.
EBITDA includes gross sales net of penalties and discounts and all operating
costs, excluding finance, tax, impairment, depreciation and amortisation
expenses.
Working capital is the difference between current assets and current
liabilities.
Cash Cost per pound of payable copper includes cash operating costs, including
treatment and refining charges ("TC/RC"), freight and distribution costs net
of by-product credits. Cash Cost per pound of payable copper is consistent
with the widely accepted industry standard established by Wood Mackenzie and
is also known as the C1 cash cost.
AISC per pound of payable copper includes C1 Cash Costs plus royalties and
agency fees, expenditures on rehabilitation, capitalised stripping costs,
exploration and geology costs, corporate costs and recurring sustaining
capital expenditures but excludes one-off sustaining capital projects, such as
the tailings dam project.
Realised price per pound of payable copper is the value of the copper payable
included in the concentrate produced including the discounts and other
features governed by the offtake agreements of the Group and all discounts or
premiums provided in commodity hedge agreements with financial institutions if
any, expressed in USD per pound of payable copper. Realised prices do not
include period end mark to market adjustments in respect of provisional
pricing Realised price is consistent with the widely accepted industry
standard definition.
6. Liquidity and Capital Resources
Atalaya monitors factors that could impact its liquidity as part of Atalaya's
overall capital management strategy. Factors that are monitored include, but
are not limited to, the market price of copper, foreign currency rates,
production levels, operating costs, capital and administrative costs.
The following is a summary of Atalaya's cash position and cash flows as at 30
June 2024 and 31 December 2023.
Liquidity information
(Euro 000's) 30 Jun 2024 31 Dec 2023
Unrestricted cash and cash equivalents at Group level 76,253 94,868
Unrestricted cash and cash equivalents at Operation level 4,784 26,139
Consolidated cash and cash equivalents 81,037 121,007
Net cash position ((1)(2)) 53,361 54,320
Working capital surplus 63,408 68,618
((1)) Includes borrowings
((2)) Net cash has been restated from the amount previously reported in the
Company's Q2 Operations Update of €30.0 million
Unrestricted cash and cash equivalents (which include cash at both Group level
and Operation level) as at 30 June 2024 decreased to €81.0 million from
€121.0 million at 31 December 2023. The decrease in cash was mainly due to
investments and repayment of financing which offset cash inflows from
operations. Specifically, investments resulted from capital expenditure in the
San Dionisio area, and higher financing outflows due to the repayment of
operating facilities. Cash balances are unrestricted and include balances at
operational and corporate level.
As of 30 June 2024, Atalaya reported a working capital surplus of €63.4
million, compared with a working capital surplus of €68.6 million at 31
December 2023. The decrease in working capital mainly resulted from the
repayment of current payables.
Overview of the Group's cash flows
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Cash flows from operating activities 30,126 18,888 28,389 31,250
Cash flows used in investing activities (17,054) (7,929) (34,931) (16,740)
Cash flows used in financing activities (18,862) (18,936) (35,671) (28,367)
Total net cash flow for the period (5,790) (7,977) (42,213) (13,857)
Net foreign exchange differences 672 1,277 2,243 55
Net decrease in cash and cash equivalents (5,118) (6,700) (39,970) (13,802)
Three months cash flows review
Total net cash outflow for the period was €5.8 million during the three
months ended 30 June 2024. This was due to the net results of cash from
operating activities amounting to €30.1 million, the cash used in investing
activities amounting to €17.1 million, the cash used in financing activities
totalling €18.9 million.
Cash generated from operating activities before working capital changes was
€26.8 million. Atalaya's trade receivables in the period decreased by €2.7
million, its inventory levels increased by €2.6 million and its trade
payables increased by €3.7 million.
Investing activities during the quarter consumed €17.1 million, relating
mainly to the tailings dams project, E-LIX, San Dionisio area and continuous
enhancements in the processing systems of the plant.
Financing activities during the quarter resulted in cash outflows of €18.9
million primarily due to repayments of existing unsecured credit facilities.
Six months cash flows review
Total net cash outflow for the period was €42.2 million during the six
months ended 30 June 2023. This was due to cash from operating activities
amounting to €28.4 million, cash used in investing activities amounting to
€34.9 million, cash used in financing activities amounting to €35.7
million.
Cash generated from operating activities before working capital changes was
€38.3 million. Atalaya decreased its trade payables in the period by €2.5
million, increased its inventory levels by €4.8 million and decreased its
trade receivable balances by €5k.
Investing activities during the six-month period decreased cash by €34.9
million, with the majority of funds directed towards the tailings dams
project, E-LIX, San Dionisio area and continuous enhancements in the
processing systems of the plant.
Financing activities during the six-month period ended 30 June 2024 resulted
in cash outflows of €35.7 million due to the repayment of unsecured credit
facilities.
Foreign exchange
Foreign exchange rate movements can have a significant effect on Atalaya's
operations, financial position and results. Atalaya's sales are denominated in
U.S. dollars ("USD"), while Atalaya's operating expenses, income taxes and
other expenses are mainly denominated in Euros ("EUR") which is the functional
currency of the Group, and to a much lesser extent in British Pounds ("GBP").
Accordingly, fluctuations in the exchange rates can potentially impact the
results of operations and carrying value of assets and liabilities on the
balance sheet.
During the three and six months ended 30 June 2024, Atalaya recognised a
foreign exchange profit of €0.7 million and €2.2 million, respectively.
Foreign exchange profits mainly related to changes in the period in EUR and
USD conversion rates, as all sales are cashed and occasionally held in USD.
The following table summarises the movement in key currencies versus the EUR:
(Euro 000's) Three month period ended 30 Jun 2024 Three month period Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
ended 30
Jun 2023
Average rates for the periods
GBP - EUR 0.8530 0.8693 0.8547 0.8764
USD - EUR 1.0767 1.0887 1.0813 1.0807
Spot rates as at
GBP - EUR 0.8464 0.8583 0.8464 0.8583
USD - EUR 1.0705 1.0866 1.0705 1.0866
7. Sustainability
Corporate Social Responsibility
For the second quarter of 2024, Atalaya has continued its social investment
through Fundación Atalaya, implementing a new series of actions to support
social entities in the Cuenca Minera region and maintaining its agreements
with the councils near the mining operation.
Fundación Atalaya has assisted several municipalities with clearing
undergrowth in the areas surrounding the mine. Due to a lack of employees and
the high fire risk from elevated temperatures, these tasks had become
unmanageable for the councils.
Additionally, Fundación Atalaya supported the XX Cultural Week 'Adela
Frigolet' held in Nerva and the II Poetry Contest in Riotinto. During this
quarter, Fundación Atalaya sponsored Samuel Delgado, a local disabled
athlete, and supported the San Antonio festivity, celebrated just 100 metres
from the mine.
Moreover, Fundación Atalaya has been working to bring and prepare a vehicle
that will enable tourists to visit the mining operation. This special bus is
the cornerstone of the Riotinto Xperience, an initiative by Fundación Atalaya
in collaboration with Fundación Río Tinto. Alongside the vehicle, Fundación
Atalaya has completed a room inside the Mining Museum of Riotinto to welcome
and prepare tourists for the mine visit. This room features a 9-metre-long
screen that will show a short documentary on the importance of copper to
humanity.
Another significant initiative by Fundación Atalaya was the Mining Operator
Course. This is the final part of the fourth edition of the course, which has
helped many people from the Cuenca Minera region find employment.
Health and Safety
Accident Statistics:
The safety performance for the second quarter of 2024 has significantly
improved compared to the same period last year. There were no lost-time
accidents during this period, and the cumulative value up to June is 57%
better than in the same period last year, for both employees and contractors.
Consequently, the reference indicators for accident rates, the frequency index
(FI) and severity index (SI), have reached 2.48 and 0.07, respectively,
comfortably meeting the annual targets for these indicators.
Industrial Hygiene Measurements:
All planned actions for industrial hygiene were completed in the second
quarter. The first intervention brigade received annual training in
extrication, high-angle rescue, and the use of self-contained breathing
apparatus.
Ergonomic Risk Assessments:
This quarter saw the start of ergonomic risk assessments, which yielded
positive results regarding the evaluation of ergonomic factors for all job
positions, including manual handling of loads, forced postures, and repetitive
movements. Additionally, the review of risk assessments for jobs and
workplaces, planned for 2024, was initiated.
Safety and Health Committee:
The second annual meeting of the Safety and Health Committee, a joint
consultation and participation meeting with workers' representatives, was
held. The requirements of the Labour Inspectorate were also addressed.
Daño Cero Project:
Phase I of the Daño Cero project was completed this quarter, using AI to
process and analyse information collected from surveys to improve safety at
the Atalaya Riotinto Minera facilities. With a 98% participation rate, there
was total involvement from both in-house personnel and partner companies in
this project. The results were presented to the participants and department
heads.
Audits and Controls:
In May, the occupational health and safety system underwent an internal audit
as part of the integrated management system. Furthermore, controls for
psychoactive substances continued at access points and in the medical centre.
Environment
During the second quarter of 2024, the environmental department continued its
efforts in environmental monitoring and natural environment management. Key
points of the quarter include:
‒ Environmental Incidents: Two environmental incidents were
recorded, both related to spills on unpaved areas. The affected areas were
cleaned, and the waste was properly managed.
‒ Rainfall Data: A total of 38.7 litres per square metre of
rainfall was recorded in Q2 2024, approximately 41% less than the same period
in the previous year. For the hydrological year (hydrological year is between
October 2023 and September 2024), total rainfall reached 826 litres per square
metre, which is 104% more than the previous hydrological year.
‒ Environmental Permit Modification: On June 4th, documents for
the new substantial modification of the AAU (Environmental Permit) due to the
San Dionisio pit expansions were submitted. The Project for Exploitation and
its Restoration Plan were submitted in May and are currently awaiting public
hearing.
‒ Mine Waste Rock Facility: In April, the extension of the Mine
Waste Rock Facility was granted as a non-substantial modification of the AAU.
‒ Dust Control Measures: Additional measures in the action plan
against dust continued to be implemented, including intensified periodic
irrigation, new coordination measures, and exhaustive monitoring of emissions
generated by the operation.
‒ Fire Prevention Plan: The Fire Prevention Plan was executed
during this quarter.
‒ Restoration Plan: The Environmental Department continued working
on the Restoration Plan for both operational and historical areas.
‒ Emission Controls: All regular internal controls of diffuse
atmospheric emissions were conducted, with results within limit values. In
April, the annual mandatory external control of diffuse and point (channelled)
emissions was carried out without incidents, meeting all limits. Other
periodic and mandatory controls were also completed without incidents.
Additionally, several reports were submitted to the administration bodies.
‒ Environmental Inspections: Daily inspections were conducted,
primarily focusing on chemical storage and handling, housekeeping, waste
management, uncontrolled releases, and environmentally friendly practices by
Atalaya Riotinto Minera SLU and contractor personnel. Dust control and
drainage system inspections were also performed regularly. A total of 90
inspections were carried out during the second quarter, covering the plant,
mine area, and contractor camps.
8. Risk Factors
Due to the nature of Atalaya's business in the mining industry, the Group is
subject to various risks that could materially impact the future operating
results and could cause actual events to differ materially from those
described in forward-looking statements relating to Atalaya. Readers are
encouraged to read and consider the risk factors detailed in Atalaya's
audited, consolidated financial statements for the year ended 31 December
2023.
The Company continues to monitor the principal risks and uncertainties that
could materially impact the Company's results and operations, including the
areas of increasing uncertainty such as the impact of macro-economic
uncertainty on the business and geopolitical developments.
9. Critical accounting policies, estimates, judgements, assumptions
and accounting changes
The preparation of Atalaya's Financial Statements in accordance with IFRS
requires management to make estimates, judgements and assumptions that affect
amounts reported in the Financial Statements and accompanying notes. There is
a full discussion and description of Atalaya's critical accounting policies in
the audited consolidated financial statements for the year ended 31 December
2023.
Update in Ore Reserves and Its Financial Impact
In May 2024, Atalaya incorporated an update of its ore reserves based on an
independent expert analysis in accordance with the Canadian Institute of
Mining, Metallurgy and Petroleum ("CIM") Definition Standards on Mineral
Resources and Mineral Reserves adopted by the CIM Council (the "CIM
Standards"). This update has some impact on our financial statements and
accounting estimates and reflects a revised understanding of the economic
potential and operational requirements of our mining assets.
Further details are given in Note 2.4 to the Unaudited Interim Condensed
Consolidated Financial Statements.
10. Other Information
Additional information about Atalaya Mining Plc. is available at
www.atalayamining.com (http://www.atalayamining.com)
Unaudited interim condensed consolidated financial statements on subsequent
pages.
By Order of the Board of Directors,
Neil Gregson
Chairman
Nicosia, 13 August 2024
Interim Condensed Consolidated Income Statement
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 June 2024 and 2023
(Euro 000's) Note Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
(Unaudited and unreviewed) (Unaudited and unreviewed)
(Unaudited) (Audited)
Revenue 4 92,208 78,223 162,146 169,394
Operating costs and mine site administrative expenses (60,056) (56,536) (116,662) (119,463)
Mine site depreciation and amortization (10,984) (9,411) (20,590) (18,173)
Gross profit 21,168 12,276 24,894 31,758
Administration and other expenses (3,076) (3,612) (5,003) (5,645)
Share-based benefits 15 (151) (254) (302) (330)
Exploration expenses (1,091) (2,069) (1,946) (3,602)
Care and maintenance expenditure (1,609) (391) (2,041) (686)
Operating profit 15,241 5,950 15,602 21,495
Other income 202 345 486 443
Net foreign exchange gain 3 672 1,277 2,243 55
Net finance (costs)/income 5 (1) 3,480 (91) 2,636
Profit before tax 16,114 11,052 18,240 24,629
Tax 6 (1,594) (1,848) (2,093) (4,321)
Profit for the period 14,520 9,204 16,147 20,308
Profit for the period attributable to:
- Owners of the parent 7 15,104 9,542 17,130 20,911
- Non-controlling interests (584) (338) (983) (603)
14,520 9,204 16,147 20,308
Earnings per share from operations attributable to equity holders of the
parent during the period:
Basic earnings per share (EUR cents per share) 7 10.8 6.8 12.2 15.0
Fully diluted earnings per share (EUR cents per share) 7 10.4 6.6 11.8 14.6
Profit for the period 14,520 9,204 16,147 20,308
Other comprehensive income that will not be reclassified to profit or loss in
subsequent periods (net of tax):
Change in fair value of financial assets through other comprehensive income 4 (11) - (5)
'OCI'
Total comprehensive income for the period 14,524 9,193 16,147 20,303
Total comprehensive income for the period attributable to:
- Owners of the parent 7 15,108 9,531 17,130 20,906
- Non-controlling interests (584) (338) (983) (603)
14,524 9,193 16,147 20,303
The notes on the subsequent pages are an integral part of these Unaudited
Interim Condensed Consolidated Financial Statements.
Interim Condensed Consolidated Statement of Financial Position
(All amounts in Euro thousands unless otherwise stated)
As at 30 June 2024 and 2023
(Euro 000's) Note 30 Jun 2024 31 Dec 2023
Assets Unaudited Audited
Non-current assets
Property, plant and equipment 8 399,981 384,739
Intangible assets 9 49,027 49,397
Trade and other receivables 12 27,326 26,702
Non-current financial assets 1,101 1,101
Deferred tax asset 11,219 11,282
488,654 473,221
Current assets
Inventories 10 38,118 33,314
Trade and other receivables 12 40,465 42,897
Tax refundable 1,847 100
Other financial assets 2.3 31 30
Cash and cash equivalents 13 81,037 121,007
161,498 197,348
Total assets 650,152 670,569
Equity and liabilities
Equity attributable to owners of the parent
Share capital 14 13,670 13,596
Share premium 14 321,859 319,411
Other reserves 15 87,704 70,463
Accumulated profit 92,973 98,026
516,206 501,496
Non-controlling interests (10,087) (9,104)
Total equity 506,119 492,392
Liabilities
Non-current liabilities
Trade and other payables 16 4,106 2,205
Provisions 17 27,271 27,234
Lease liabilities 19 3,560 3,877
Borrowings 18 11,006 16,131
45,943 49,447
Current liabilities
Trade and other payables 16 73,401 75,922
Lease liabilities 19 485 501
Borrowings 18 16,670 50,556
Dividend payable 11 5,244 -
Current provisions 17 163 434
Current tax liabilities 2,127 1,317
98,090 128,730
Total liabilities 144,033 178,177
Total equity and liabilities 650,152 670,569
The notes on the subsequent pages are an integral part of these Unaudited
Interim Condensed Consolidated Financial Statements.
Neil Gregson Alberto Lavandeira
Chairman CEO
Interim Condensed Consolidated Statement of Changes in Equity
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 June 2024 and 2023
(Euro 000's) Note Share capital Share premium ((1)) Other reserves Accum. Profits Total NCI Total equity
(Unaudited)
At 1 January 2024 13,596 319,411 70,463 98,026 501,496 (9,104) 492,392
Profit for the period - - - 17,130 17,130 (983) 16,147
Total comprehensive income - - - 17,130 17,130 (983) 16,147
Issuance of share capital 14 74 2,448 - - 2,522 - 2,522
Recognition of depletion factor 15 - - 7,500 (7,500) - - -
Recognition of share-based payments 15 - - 302 - 302 - 302
Recognition of non-distributable reserve 15 - - 142 (142) - - -
Recognition of distributable reserve 15 - - 9,297 (9,297) - - -
Dividends 11 - - - (5,244) (5,244) - (5,244)
At 30 June 2024 13,670 321,859 87,704 92,973 516,206 (10,087) 506,119
(Euro 000's) Note Share capital Share premium ((1)) Other reserves Accum. Profits Total NCI Total equity
(Audited)
At 1 January 2023 13,596 319,411 69,805 70,483 473,295 (6,998) 466,297
Profit for the period - - - 20,911 20,911 (603) 20,308
Change in fair value of financial assets through OCI - - (5) - (5) - (5)
Total comprehensive income - - (5) 20,911 20,906 (603) 20,303
Recognition of share-based payments 15 - - 331 - 331 - 331
Other changes in equity - - - 224 224 - 224
Dividends 11 - - - (4,956) (4,956) - (4,956)
At 30 June 2023 13,596 319,411 70,131 86,650 489,788 (7,601) 482,187
(Euro 000's) Note Share capital Share premium ((1)) Other reserves Accum. Profits Total NCI Total equity
(Audited)
At 1 January 2023 13,596 319,411 69,805 70,483 473,295 (6,998) 466,297
Profit for the period - - - 38,769 38,769 (2,106) 36,663
Change in fair value of financial assets through OCI - - (3) - (3) - (3)
Total comprehensive income - - (3) 38,769 38,766 (2,106) 36,660
Recognition of share-based payments 15 - - 661 - 661 - 661
Other changes in equity - - - 252 252 - 252
Dividends paid 11 - - - (11,478) (11,478) - (11,478)
At 31 December 2023 13,596 319,411 70,463 98,026 501,496 (9,104) 492,392
((1)) The share premium reserve is not available for distribution
The notes on subsequent pages are an integral part of these Unaudited Interim
Condensed Consolidated Financial Statements.
Interim Condensed Consolidated Statement of Cash Flows
(All amounts in Euro thousands unless otherwise stated)
For to the period ended 30 June 2024 and 2023
(Euro 000's) Note Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2023
Six month period ended 30 Jun 2024
(Unaudited and unreviewed) (Unaudited and unreviewed)
(Unaudited) (Audited)
Cash flows from operating activities
Profit before tax 16,114 11,052 18,240 24,629
Adjustments for:
Depreciation of property, plant and equipment 8 10,300 8,236 19,326 15,914
Amortisation of intangibles 9 685 1,175 1,264 2,259
Recognition of share-based payments 15 151 254 302 330
Interest income 5 (452) (4,171) (987) (4,397)
Interest expense 5 445 684 956 1,194
Unwinding of discounting on mine rehabilitation provision 17 - - 107 553
Other provisions 17 - 234 - 287
Net foreign exchange differences 3 (672) (1,277) (2,243) (55)
Unrealised foreign exchange loss on financing activities 250 (1,446) 1,285 (1,850)
Cash inflows from operating activities before working capital changes 26,821 14,741 38,250 38,864
Changes in working capital:
Inventories 10 (2,560) (3,851) (4,804) 79
Trade and other receivables 12 2,684 9,893 5 17,328
Trade and other payables 16 3,695 347 (2,518) (20,647)
Provisions 17 (60) (146) (331) (294)
Cash flows from operations 30,580 20,984 30,602 35,330
Tax paid - (1,406) (1,242) (2,873)
Interest on leases liabilities 5 (8) (6) (15) (13)
Interest paid 5 (446) (684) (956) (1,194)
Net cash from operating activities 30,126 18,888 28,389 31,250
Cash flows from investing activities
Purchase of property, plant and equipment 9 (16,552) (11,678) (34,405) (20,523)
Purchase of intangible assets 10 (622) (17) (894) (48)
Interest received 5 120 3,766 368 3,831
Net cash used in investing activities (17,054) (7,929) (34,931) (16,740)
Cash flows from financing activities
Lease payments 19 (123) (144) (333) (295)
Net (Repayments) from borrowings 18 (21,261) (18,792) (37,860) (28,072)
Proceeds from issuance of shares 14 2,522 - 2,522 -
Net cash from financing activities (18,862) (18,936) (35,671) (28,367)
Net (decrease) / increase in cash and cash equivalents (5,790) (7,977) (42,213) (13,857)
Net foreign exchange difference 3 672 1,277 2,243 55
Cash and cash equivalents:
At beginning of the period 86,155 119,346 121,007 126,448
At end of the period 81,037 112,646 81,037 112,646
The notes on the subsequent pages are an integral part of these Unaudited
Interim Condensed Consolidated Financial Statements.
Notes to the Unaudited Interim Condensed Consolidated Financial Statements
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 June 2024 and 2023
1. Incorporation and summary of business
Atalaya Mining Plc (the "Company") was incorporated in Cyprus on 17 September
2004 as a private company with limited liability under the Companies Law, Cap.
113 and was converted to a public limited liability company on 26 January
2005. Its registered office is at 1 Lampousa Street, Nicosia, Cyprus.
The Company was first listed on the Alternative Investment Market (AIM) of the
London Stock Exchange in May 2005, trading under the symbol ATYM. On 29 April
2024, the Company was admitted to trading on the main market of the London
Stock Exchange.
Additional information about Atalaya Mining Plc is available at
www.atalayamining.com (http://www.atalayamining.com) .
Change of name and share consolidation
Following the Company's Extraordinary General Meeting ("EGM") on 13 October
2015, the change of name from EMED Mining Public Limited to Atalaya Mining Plc
became effective on 21 October 2015. On the same day, the consolidation of
ordinary shares came into effect, whereby all shareholders received one new
ordinary share of nominal value Stg £0.075 for every 30 existing ordinary
shares of nominal value Stg £0.0025.
Principal activities
Atalaya is a European mining and development company. The strategy is to
evaluate and prioritise metal production opportunities in several
jurisdictions throughout the well-known belts of base and precious metal
mineralisation in Spain, elsewhere in Europe and Latin America.
The Group has interests in four mining projects: Proyecto Riotinto, Proyecto
Touro, Proyecto Masa Valverde and Proyecto Ossa Morena. In addition, the Group
has an earn-in agreement to acquire three investigation permits at Proyecto
Riotinto Este.
Proyecto Riotinto
The Company owns and operates through a wholly owned subsidiary, "Proyecto
Riotinto", an open-pit copper mine located in the Iberian Pyrite Belt, in the
Andalusia region of Spain, approximately 65 km northwest of Seville. A
brownfield expansion of this mine was completed in 2019 and successfully
commissioned by Q1 2020.
Proyecto Touro
The Group has an initial 10% stake in Cobre San Rafael, S.L., the owner of
Proyecto Touro, as part of an earn-in agreement which will enable the Group to
acquire up to 80% of Cobre San Rafael S.L. Proyecto Touro is located in
Galicia, north-west Spain. Proyecto Touro is currently in the permitting
process.
In November 2019, Atalaya executed the option to acquire 12.5% of
Explotaciones Gallegas del Cobre, S.L. the exploration property around Touro,
with known additional resources, which will provide further optionality to
Proyecto Touro.
Proyecto Masa Valverde
On 21 October 2020, the Company announced that it entered into a definitive
purchase agreement to acquire 100% of the shares of Cambridge Mineria España,
S.L. (since renamed Atalaya Masa Valverde, S.L.U.), a Spanish company which
fully owns the Masa Valverde polymetallic project located in Huelva (Spain).
Under the terms of the agreement Atalaya would make an aggregate €1.4
million cash payment in two instalments of approximately the same amount. The
first payment of €0.7 million was made in January 2024 after the permits
were granted. The second and final payment will be made when first production
from the concession is obtained.
In November 2023, the exploitation permits for the Masa Valverde and Majadales
deposits were officially granted.
In January 2024, the Company made the first instalment payment of €0.7
million.
Proyecto Ossa Morena
In December 2021, Atalaya announced the acquisition of a 51% interest in Rio
Narcea Nickel, S.L., which owns 9 investigation permits. The acquisition also
provided a 100% interest in three investigation permits that are also located
along the Ossa- Morena Metallogenic Belt. In Q3 2022, Atalaya increased its
ownership interest in POM to 99.9%, up from 51%, following completion of a
capital increase that will fund exploration activities. During 2022 Atalaya
rejected 8 investigation permits.
Atalaya will pay a total of €2.5 million in cash in three instalments and
grant a 1% net smelter return ("NSR") royalty over all acquired permits. The
first payment of €0.5 million was made following execution of the purchase
agreement. The second and third instalments of €1 million each will be made
once the environmental impact statement ("EIS") and the final mining permits
for any project within any of the investigation permits acquired under the
Transaction are secured.
Proyecto Riotinto East
In December 2020, Atalaya entered into a Memorandum of Understanding with a
local private Spanish company to acquire a 100% beneficial interest in two
investigation permits (known as Peñas Blancas and Cerro Negro investigation
permits), which are located immediately to the east of Proyecto Riotinto.
2. Basis of preparation and accounting policies
2.1 Basis of preparation
(a) Overview
These interim condensed financial statements are unaudited.
The unaudited interim condensed consolidated financial statements for the
period ended 30 June 2024 have been prepared in accordance with International
Accounting Standard 34: Interim Financial Reporting and as adopted by the
European Union (IFRS-EU) and the interpretations of the IFRS Interpretations
Committee (IFRS IC) approved by Regulations of the European Commission, using
the historical cost convention and have been prepared on a historical cost
basis except for the revaluation of certain financial instruments that are
measured at fair value at the end of each reporting period, as explained
below.
These unaudited interim condensed consolidated financial statements include
the financial statements of the Company and its subsidiary undertakings. They
have been prepared using accounting bases and policies consistent with those
used in the preparation of the consolidated financial statements of the
Company and the Group for the year ended 31 December 2023. These unaudited
interim condensed consolidated financial statements do not include all the
disclosures required for annual financial statements, and accordingly, should
be read in conjunction with the consolidated financial statements and other
information set out in the Group's annual report for the year ended 31
December 2023.
(b) Going concern
These unaudited interim condensed consolidated financial statements have been
prepared based on accounting principles applicable to a going concern which
assumes that the Group will realise its assets and discharge its liabilities
in the normal course of business. Management has carried out an assessment of
the going concern assumption and has concluded that the Group will generate
sufficient cash and cash equivalents to continue operating for the next twelve
months.
Management continues to monitor the impact of geopolitical developments.
Currently no significant impact is expected in the operations of the Group.
2.2 New standards, interpretations and amendments adopted by the Group
The accounting policies adopted in the preparation of the unaudited condensed
interim consolidated financial statements are consistent with those followed
in the preparation of the Group's annual consolidated financial statements for
the year ended 31 December 2023, except for the adoption of new standards
effective as of 1 January 2024. The Group has not early adopted any standard,
interpretation or amendment that has been issued but is not yet effective.
Several amendments and interpretations apply for the first time in 2024, but
do not have a material impact on the unaudited interim condensed consolidated
financial statements of the Group.
IAS 1 Presentation of Financial Statements: Classification of Liabilities as
Current or Non-current (Amendments)
The amendments are effective for annual reporting periods beginning on or
after January 1, 2024, with earlier application permitted, and will need to be
applied retrospectively in accordance with IAS 8. The objective of the
amendments is to clarify the principles in IAS 1 for the classification of
liabilities as either current or non-current. The amendments clarify the
meaning of a right to defer settlement, the requirement for this right to
exist at the end of the reporting period, that management intent does not
affect current or non-current classification, that options by the counterparty
that could result in settlement by the transfer of the entity's own equity
instruments do not affect current or non-current classification. Also, the
amendments specify that only covenants with which an entity must comply on or
before the reporting date will affect a liability's classification. Additional
disclosures are also required for non-current liabilities arising from loan
arrangements that are subject to covenants to be complied with within twelve
months after the reporting period. The amendments had no material impact on
the Group's unaudited interim condensed consolidated financial statements.
IFRS 16 Leases: Lease Liability in a Sale and Leaseback (amendments)
The amendments are effective for annual reporting periods beginning on or
after January 1, 2024, with earlier application permitted. The amendments are
intended to improve the requirements that a seller-lessee uses in measuring
the lease liability arising in a sale and leaseback transaction in IFRS 16,
while it does not change the accounting for leases unrelated to sale and
leaseback transactions. In particular, the seller-lessee determines 'lease
payments' or 'revised lease payments' in such a way that the seller-lessee
would not recognise any amount of the gain or loss that relates to the right
of use it retains. Applying these requirements does not prevent the
seller-lessee from recognising, in profit or loss, any gain or loss relating
to the partial or full termination of a lease. A seller-lessee applies the
amendment retrospectively in accordance with IAS 8 to sale and leaseback
transactions entered into after the date of initial application, being the
beginning of the annual reporting period in which an entity first applied IFRS
16. The amendments had no material impact on the Group's unaudited interim
condensed consolidated financial statements.
IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments Disclosure -
Supplier Finance Arrangements (Amendments)
The amendments are effective for annual reporting periods beginning on or
after January 1, 2024, with earlier application permitted. The amendments
supplement requirements already in IFRS and require an entity to disclose the
terms and conditions of supplier finance arrangements. Additionally, entities
are required to disclose at the beginning and end of reporting period the
carrying amounts of supplier finance arrangement financial liabilities and the
line items in which those liabilities are presented as well as the carrying
amounts of financial liabilities and line items, for which the finance
providers have already settled the corresponding trade payables. Entities
should also disclose the type and effect of non-cash changes in the carrying
amounts of supplier finance arrangement financial liabilities, which prevent
the carrying amounts of the financial liabilities from being comparable.
Furthermore, the amendments require an entity to disclose at the beginning and
end of the reporting period the range of payment due dates for financial
liabilities owed to the finance providers and for comparable trade payables
that are not part of those arrangements. The amendments have not yet been
endorsed by the EU. The amendments had no material impact on the Group's
unaudited interim condensed consolidated financial statements.
IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of
Exchangeability (Amendments)
The amendments are effective for annual reporting periods beginning on or
after January 1, 2025, with earlier application permitted. The amendments
specify how an entity should assess whether a currency is exchangeable and how
it should determine a spot exchange rate when exchangeability is lacking. A
currency is considered to be exchangeable into another currency when an entity
is able to obtain the other currency within a time frame that allows for a
normal administrative delay and through a market or exchange mechanism in
which an exchange transaction would create enforceable rights and obligations.
If a currency is not exchangeable into another currency, an entity is required
to estimate the spot exchange rate at the measurement date. An entity's
objective in estimating the spot exchange rate is to reflect the rate at which
an orderly exchange transaction would take place at the measurement date
between market participants under prevailing economic conditions. The
amendments note that an entity can use an observable exchange rate without
adjustment or another estimation technique. The amendments had no material
impact on the Group's unaudited interim condensed consolidated financial
statements.
2.3 Fair value estimation
The fair values of the Group's financial assets and liabilities approximate
their carrying amounts at the reporting date.
The fair value of financial instruments traded in active markets, such as
publicly traded trading and other financial assets is based on quoted market
prices at the reporting date. The quoted market price used for financial
assets held by the Group is the current bid price. The appropriate quoted
market price for financial liabilities is the current ask price.
The fair value of financial instruments that are not traded in an active
market is determined by using valuation techniques. The Group uses a variety
of methods, such as estimated discounted cash flows, and makes assumptions
that are based on market conditions existing at the reporting date.
Fair value measurements recognised in the consolidated statement of financial
position
The following table provides an analysis of financial instruments that are
measured subsequent to initial recognition at fair value, Grouped into Levels
1 to 3 based on the degree to which the fair value is observable.
· Level 1 fair value measurements are those derived from quoted
prices (unadjusted) in active markets for identical assets or liabilities.
· Level 2 fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices).
· Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
2.3 Fair value estimation
Financial assets or liabilities Level 1 Level 2 Level 3 Total
(Euro 000's)
30 Jun 2024
Other financial assets
Financial assets at FV through OCI 31 - 1,101 1,132
Trade and other receivables
Receivables (subject to provisional pricing) - 10,487 - 10,487
Total 31 10,487 1,101 11,619
31 Dec 2023
Other financial assets
Financial assets at FV through OCI 30 - 1,101 1,131
Trade and other receivables
Receivables (subject to provisional pricing) - 15,164 - 15,164
Total 30 15,164 1,101 16,295
2.4 Critical accounting estimates and judgements
The preparation of the unaudited interim condensed consolidated financial
statements require management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities, and the accompanying disclosures, and the disclosure of
contingent liabilities at the date of the consolidated financial statements.
Estimates and assumptions are continually evaluated and are based on
management's experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances. Uncertainty
about these assumptions and estimates could result in outcomes that require a
material adjustment to the carrying amount of assets or liabilities affected
in future periods.
Provisions are recognised when the Group has a present legal or constructive
obligation as a result of past events, it is probable that an outflow of
resources will be required to settle the obligation, and a reliable estimate
of the amount can be made. If the effect of the time value of money is
material, provisions are discounted using a current pre-tax rate that
reflects, where appropriate, the risks specific to the liability. Where
discounting is used, the increase in the provision due to the passage of time
is recognised as a finance cost.
A full analysis of critical accounting estimates and judgements is set out in
Note 3.3 of the 2023 audited financial statements.
Update in Ore Reserves and Its Financial Impact
In May 2024, Atalaya incorporated an update of its ore reserves based on an
independent expert analysis in accordance with the Canadian Institute of
Mining, Metallurgy and Petroleum ("CIM") Definition Standards on Mineral
Resources and Mineral Reserves adopted by the CIM Council (the "CIM
Standards"). This update has some impact on our financial statements and
accounting estimates and reflects a revised understanding of the economic
potential and operational requirements of our mining assets.
Judgements and Assumptions:
The update in ore reserves requires significant judgments and assumptions,
particularly in estimating the quantity and quality of the ore, the economic
viability of extraction, and the life of the mine. These estimates impact
various accounting measures, including depreciation schedules, cost
allocations, and capitalisation policies. Our management has applied
considerable expertise and relied on independent expert opinions to ensure
these estimates are robust and reflect the best available information.
Impact on Profit and Loss Statement:
The update of ore reserves has resulted in some changes to our accounting
practices in relation to depreciation, stripping costs and capitalisation.
Specifically, these changes result in a total decrease in net profit of €1.5
million, comprising €0.7 million from increased depreciation, €0.1 million
from increased depreciation of stripping costs and €0.7 million from reduced
capitalisation of stripping costs. These changes help to maintain the accuracy
of our financial statements and ensure that they give a fair view of the
financial position and performance of our business.
Accumulated Depreciation of Mining Assets:
The revised ore reserve estimates have led to an increase in the accumulated
depreciation of our mining assets by €0.7 million during the six-month
period. This change is due to the adjustment in the useful life and depletion
rate of these assets, which are now expected to be utilised over a shorter
timeframe than previously estimated. The new ore reserve data has provided a
more accurate basis for calculating depreciation, ensuring our financial
records accurately reflect the wear and tear on these assets over their
updated useful lives.
Stripping Costs: depreciation
The reserves update also resulted in an increase in depreciation of €0.1
million during the period. Depreciation, which covers the allocation of the
cost of assets over their useful lives, has been adjusted to reflect the new
ore reserve estimates. The reassessment of reserves has impacted the level and
timing of depreciation, reflecting the updated operational requirements to
access the newly defined ore bodies.
Capitalisation of Stripping Costs:
In conjunction with the increase in stripping costs, there is a reduction in
the capitalisation of stripping costs amounting to €0.7 million. This
adjustment arises from the revised criteria for capitalising stripping costs
under the updated ore reserve estimates. With a clearer understanding of the
ore body and its economic feasibility, certain costs previously capitalised
are now expensed, aligning our financial practices with the current and more
accurate projections of our mining operations.
Compliance with Reporting Standards:
The Group reports its Mineral Resources and Mineral Reserves in accordance
with the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM")
Definition Standards on Mineral Resources and Mineral Reserves adopted by the
CIM Council (the "CIM Standards"). This ensures that our reporting is
consistent with internationally recognised guidelines, providing transparency
and comparability for our stakeholders.
3. Business and geographical segments
Business segments
The Group has only one distinct business segment, being that of mining
operations, which include mineral exploration and development.
Copper concentrates produced by the Group are sold to three off-takers as per
the relevant offtake agreements. In addition, the Group has spot agreements
for the concentrates not committed to off-takers.
Geographical areas of sales
The Group's mining activities are located in Spain. The commercialisation of
the copper concentrates produced in Spain is carried out through Cyprus. Sales
transactions to related parties are on arm's length basis in a similar manner
to transaction with third parties. Accounting policies used by the Group in
different locations are the same as those contained in Note 2.
The table below presents revenues from external customers attributed to the
country of establishment of each customer.
Revenue - from external customers Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
€'000 €'000 €'000 €'000
Switzerland 76,805 55,952 127,042 132,727
Singapore 15,403 22,271 35,104 36,667
92,208 78,223 162,146 169,394
Revenue represents the sales value of goods supplied to customers; net of
value added tax. The following table summarises sales to customers with whom
transactions have individually exceeded 10.0% of the Group's revenues.
(Euro 000's) Six month period ended Six month period ended 30 Jun 2023
30 Jun 2024
Segment €'000 Segment €'000
Offtaker 1 Copper 35,104 Copper 36,667
Offtaker 2 Copper 55,229 Copper 39,553
Offtaker 3 Copper 71,797 Copper 93,157
162,130 169,377
The geographical location of the specified non-current assets is based on the
physical location of the asset in the case of property, plant and equipment
and intellectual property and the location of the operation to which they are
allocated in the case of goodwill.
Non-current assets 30 Jun 2024 31 Dec 2023
€'000 €'000
Spain 449,008 434,136
449,008 434,136
4. Revenue
(Euro 000's) Three month period ended 30 Jun 2024, Three month period ended 30 Jun 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Revenue from contracts with customers ((1)) 96,514 84,774 170,232 173,087
Fair value losses relating to provisional pricing within sales ((2)) (4,306) (6,551) (8,086) (3,693)
Total revenue 92,208 78,223 162,146 169,394
All revenue from copper concentrate is recognised at a point in time when the
control is transferred. Revenue from freight services is recognised over time
as the services are provided.
((1) ) Included within Q2 2024 and H1 2024 revenues are
transaction prices, which relate to the freight services provided by the Group
to the customers arising from the sales of copper concentrate under CIF
incoterm, of €3.2 million (Q2 2023: €2.1 million) and €6.3 million (H1
2023: €4.5 million), respectively.
((2) ) Provisional pricing impact represents the change in fair
value of the embedded derivative arising on sales of concentrate.
5. Net Finance Income/(Costs)
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Interest expense
Other interest ((1)) (445) (684) (956) (1,194)
Interest on lease liabilities (8) (6) (15) (13)
Unwinding of discount on mine rehabilitation provision (Note 17) - - (107) (553)
Interest income
Financial interests 452 340 987 566
Other received interests ((2)) - 3,830 - 3,830
Total (1) 3,480 (91) 2,636
Interest expense capitalised ((3)) 240 217 430 401
((1) ) Interest expense related to interest accrued on bank
payable balances.
((2) ) Interest income comprise mainly the interest received of
€3.8 million as a result of the agreement reached with Astor in May 2023.
((3) ) Amounts capitalized within the above table is referred to
50 MW Solar plant.
6. Tax
The Group calculates the period income tax expense using the tax rate that
would be applicable to the expected total annual earnings. The major
components of income tax expense in the unaudited interim condensed
consolidated statement of profit or loss are:
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Income taxes
Current income tax expense (1,594) (1,848) (2,093) (4,321)
Income tax expense recognised in statement of profit and loss (1,594) (1,848) (2,093) (4,321)
7. Earnings per share
The calculation of the basic and fully diluted loss per share attributable to
the ordinary equity holders of the Company is based on the following data:
Three months ended 30 Jun 2024 Three months ended 30 Jun 2023 Six months ended 30 Jun 2024 Six months ended
30 Jun 2023
(Euro 000's)
Profit attributable to equity holders of the parent 15,104 9,542 17,130 20,911
Weighted number of ordinary shares for the purposes of basic earnings per 140,196 139,880 140,044 139,880
share (000's)
Basic profit per share (EUR cents/share) 10.8 6.8 12.2 15.0
Weighted number of ordinary shares for the purposes of fully diluted earnings 144,728 144,028 145,000 143,705
per share (000's)
Fully diluted profit per share (EUR cents/share) 10.4 6.6 11.8 14.6
At 30 June 2024 there are nil warrants (Note 14) and 5,273,666 options (Note
14) (2023: nil warrants and 4,848,500 options) which have been included when
calculating the weighted average number of shares for 2024.
8. Property, plant and equipment
(Euro 000's) Land and buildings Right-of-use assets Plant and machinery Assets under construction ((1)) Deferred mining costs ((2)) Other assets ((3)) Total
Cost
At 1 January 2023 80,326 7,076 291,335 50,235 52,358 872 482,202
Additions 36 - 4,525 15,825 4,572 24 24,982
Advances 10 - - - - - 10
Reclassifications - - 18,413 (18,413) - - -
Increase in rehab. Provision 2,541 - - - - - 2,541
At 30 June 2023 82,913 7,076 314,273 47,647 56,930 896 509,735
Additions - - 1,486 26,324 7,142 55 35,007
Increase in rehab. Provision 604 - - - - - 604
Reclassifications - - 3,370 (3,370) - - -
At 31 December 2023 83,517 7,076 319,129 70,601 64,072 951 545,346
Adjustments - - 5 - - - 5
Opening adjusted 83,517 7,076 319,134 70,601 64,072 951 545,351
Additions 151 - 561 32,388 1,310 - 34,410
Increase in rehab. Provision 741 - - - - - 741
Reclassifications - - 1,958 (1,958) - - -
Write-off - (148) (439) - - - (587)
At 30 June 2024 84,409 6,928 321,214 101,031 65,382 951 579,915
Depreciation
At 1 January 2023 20,454 1,998 89,182 - 14,921 739 127,294
Adjustments - - 6 - - - 6
Opening adjusted 20,454 1,998 89,188 - 14,921 739 127,300
Charge for the period 2,057 278 11,717 - 1,855 7 15,914
At 30 June 2023 22,511 2,276 100,905 - 16,776 746 143,214
Charge for the period 2,191 255 12,642 - 2,287 18 17,393
At 31 December 2023 24,702 2,531 113,547 - 19,063 764 160,607
Adjustments - - 1 - - - 1
Opening adjusted 24,702 2,531 113,548 - 19,063 764 160,608
Charge for the period 3,387 244 13,201 - 2,530 21 19,383
Write-off - (57) - - - - (57)
At 30 June 2024 28,089 2,718 126,749 - 21,593 785 179,934
Net book value
At 30 June 2024 56,320 4,210 194,465 101,031 43,789 166 399,981
At 31 December 2023 58,815 4,545 205,582 70,601 45,009 187 384,739
( )
(
)
( )
((1)) Assets under construction at 30 June 2024 were €101.0 million (31
December 2023: €70.6 million) which include sustaining capital expenditures
(mainly associated with San Dionisio area), tailings dams project, E-LIX plant
and solar plant.
((2)) Stripping costs
((3)) Includes motor vehicles, furniture, fixtures and office equipment which
are depreciated over 5-10 years.
((4)) Increase in lands related to the rehabilitation provision
The above fixed assets are mainly located in Spain.
E-LIX Phase I Plant
In January 2022, Atalaya approved the construction of the E-LIX Phase I Plant,
the first phase of an industrial-scale processing plant utilising the E-LIX
System. The E-LIX System is a newly developed and innovative electrochemical
extraction process that utilises singular catalysts and physicochemical
conditions to dissolve the valuable metals contained within sulphide
concentrates in order to produce high-value copper and zinc metals from
complex sulphide concentrates.
The E-LIX System was developed by Lain Technologies Ltd ("Lain Tech") with the
financial support of Atalaya. Over a period of six years, Atalaya and Lain
Tech conducted continuous evaluation, de-risking and testing of the process,
including through the development of a semi-industrial pilot plant in 2019 to
demonstrate the feasibility of the system. In 2020, Atalaya reached agreement
with Lain Tech to use Lain Tech patents on an exclusive basis within the
Iberian Pyrite Belt in Spain and Portugal.
The E-LIX Phase I Plant is also expected to reduce Atalaya's carbon footprint
by producing high-purity metals on-site and reducing transportation costs and
treatment charges.
In this regard, Atalaya has constructed an Industrial Plant, recorded in its
tangible fixed assets (under construction). Additionally, it has provided Lain
Technologies Ltd with the necessary financing to undertake the investment in
E-LIX technological assets. This financing is recorded as a prepayment (see
note 12).
Commissioning and ramp-up of the facility continues, with first zinc recovered
in H1 2024 and an initial capacity designed to produce 6,000 tonnes of copper
metal per year or 10,000 tonnes of zinc metal per year, depending on the
concentrate feed ratio. In H1 2024, investments in the E-LIX Phase I Plant
totalled €6.5 million of which €nil was accounted for as prepayments to
Lain Technologies Ltd (compared with FY2023, during which investments totalled
€18.1 million, of which €9.1 million was accounted for as prepayments to
Lain Technologies Ltd).
9. Intangible assets
(Euro 000's) Permits Licences, R&D and software Total
Cost
At 1 January 2023 81,255 8,642 89,897
Additions 48 - 48
At 30 June 2023 81,303 8,642 89,945
Additions 96 116 212
Disposals (200) - (200)
At 31 December 2023 81,199 8,758 89,957
Additions 894 - 894
At 30 June 2024 82,093 8,758 90,851
Amortisation
At 1 January 2023 27,627 8,440 36,067
Charge for the period 2,234 25 2,259
At 30 June 2023 29,861 8,465 38,326
Charge for the period 2,219 15 2,234
At 31 December 2023 32,080 8,480 40,560
Charge for the period 1,249 15 1,264
At 30 June 2024 33,329 8,495 41,824
Net book value
At 30 June 2024 48,764 263 49,027
At 31 December 2023 49,119 278 49,397
Increase in permits in 2024 related to the capitalisation of Proyecto Masa
Valverde.
The ultimate recovery of balances carried forward in relation to areas of
interest or all such assets including intangibles is dependent on successful
development, and commercial exploitation, or alternatively the sale of the
respective areas.
The Group conducts impairment testing on an annual basis unless indicators of
impairment are not present at the reporting date.
10. Inventories
(Euro 000's) 30 Jun 2024 31 Dec 2023
Finished products 10,155 8,416
Materials and supplies 24,575 21,852
Work in progress 3,388 3,046
Total inventories 38,118 33,314
As of 30 June 2024, copper concentrate produced and not sold amounted to 8,749
tonnes (31 Dec 2023: 6,722 tonnes). Accordingly, the inventory for copper
concentrate was €10.2 million (31 Dec 2023: €8.4 million).
Materials and supplies relate mainly to machinery spare parts. Work in
progress represents ore stockpiles, which is ore that has been extracted and
is available for further processing.
11. Dividends
Cash dividends declared and paid during the period:
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Dividends declared and paid - - - -
Cash dividends declared but not paid during the period:
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Dividends declared but not paid 5,244 4,956 5,244 4,956
Cash dividends payable at the end of the period:
(Euro 000's) 30 Jun 2024 31 Dec 2023
Dividend payable 5,244 -
A final dividend of US$0.04 per ordinary share, which is equivalent to
approximately £0.031 per share, in respect of 2023 was proposed on 18 March
2024 for approval by shareholders at the 2024 AGM, which gives a total
dividend for 2023 of US$0.09 per share. Following the approval of Resolution
11 by the Company's shareholders at the 2024 AGM, which took place on 27 June
2024, the final dividend which (based on as exchange rates used for conversion
after the record date) amounted to €5.2 million was approved and the
dividend was paid on 9 August 2024.
12. Trade and other receivables
(Euro 000's) 30 Jun 2024 31 Dec 2023
Non-current
Deposits 312 307
Loans 233 233
Prepayments 24,095 23,476
Other non-current receivables 2,686 2,686
27,326 26,702
Current
Trade receivables at fair value - subject to provisional pricing 8,148 10,110
Trade receivables from shareholders at fair value - subject to provisional 2,339 5,054
pricing (Note 22.3)
Other receivables from related parties at amortised cost (Note 22.3) 56 56
Deposits 35 37
VAT receivables 24,469 21,003
Tax advances 32 -
Prepayments 4,219 5,855
Other current assets 1,167 782
40,465 42,897
Allowance for expected credit losses - -
Total trade and other receivables 67,791 69,599
Trade receivables are shown net of any interest applied to prepayments.
Payment terms are aligned with offtake agreements and market standards and
generally are 7 days on 90% of the invoice and the remaining 10% at the
settlement date which can vary between 1 to 5 months. The fair values of trade
and other receivables approximate to their book values.
Non-current deposits included €250k (€250k at 31 December 2023) as a
collateral for bank guarantees, which was recorded as restricted cash (or
deposit).
The prepayments relate to an agreement entered into between the Group and Lain
Technologies Ltd for the construction of an industrial plant using the E-LIX
technology, which is currently in final construction, commissioning and
ramp-up, at Proyecto Riotinto. This technology system is a newly developed
electrochemical extraction process that utilises singular catalysts and
physiochemical conditions to dissolve the valuable metals contained within
sulphide concentrates. Lain Technologies Ltd. developed and fully owns the
E-LIX System. According to the agreement, once the Industrial Plant at
Proyecto Riotinto is operational, the Group will have access to (i) the use of
E-LIX Technology to extract cathodes and (ii) exclusivity in the use of the
E-LIX Technology on concentrates extracted from the Iberian Pyrite Belt for
eight years (also see note 8 for a deeper understanding).
13. Cash and cash equivalents
(Euro 000's) 30 Jun 2024 31 Dec 2023
Unrestricted cash and cash equivalents at Group level 76,253 94,868
Unrestricted cash and cash equivalents at Operation level 4,784 26,139
Consolidated cash and cash equivalents 81,037 121,007
Cash and cash equivalents denominated in the following currencies:
(Euro 000's) 30 Jun 2024 31 Dec 2023
Euro - functional and presentation currency 57,782 50,470
Great Britain Pound 139 52
United States Dollar 23,116 70,485
Consolidated cash and cash equivalents 81,037 121,007
14. Share capital and share premium
Shares Share Capital Share premium Total
000's Stg£'000 Stg£'000 Stg£'000
Authorised
Ordinary shares of Stg £0.075 each* 200,000 15,000 - 15,000
Issued and fully paid Shares Share Capital Share premium Total
Issue Date Price (£) Details 000's €'000 €'000 €'000
31 December 2022/1 January 2023 139,880 13,596 319,411 333,007
31-Dec-23 139,880 13,596 319,411 333,007
9-Feb-24 3.090 Exercised share options ((a)) 20 2 71 73
7-May-24 2.015 Exercised share options ((b)) 67 3 154 157
22-May-24 2.015 Exercised share options ((c)) 600 53 1,368 1,421
27-Jun-24 4.160 Exercised share options ((d)) 120 10 570 580
27-Jun-24 3.575 Exercised share options ((d)) 37 3 149 152
27-Jun-24 3.270 Exercised share options ((d)) 37 3 136 139
At 30-Jun-24 140,761 13,670 321,859 335,529
Authorised capital
The Company's authorised share capital is 200,000,000 ordinary shares of Stg
£0.075 each.
Issued capital
(a) On 9 February 2024, the Company announced that it has issued 20,000
ordinary shares of 7.5p in the Company ("Option Shares") pursuant to an
exercise of share options by an employee.
(b) On 7 May 2024, Atalaya announced that it has issued 66,500 ordinary
shares of 7.5p in the Company ("Option Shares") pursuant to an exercise of
share options by an employee.
(c) On 22 May 2024, the Company announced that it has issued 600,000
ordinary shares of 7.5p in the Company ("Option Shares") pursuant to an
exercise of share options by a person discharging managerial responsibilities
("PDMR").
(d) On 27 June 2024, Atalaya announced that it has issued 193,334 ordinary
shares of 7.5p in the Company ("Option Shares") pursuant to the exercise of
share options by an employee. These options were issued as part of the
Company's long term incentive plan.
No shares were issued in FY2023.
The Company's share capital at 30 June 2024 is 140,759,043 ordinary shares of
Stg £0.075 each.
In general, option agreements contain provisions adjusting the exercise price
in certain circumstances including the allotment of fully paid ordinary shares
by way of a capitalisation of the Company's reserves, a subdivision or
consolidation of the ordinary shares, a reduction of share capital and offers
or invitations (whether by way of rights issue or otherwise) to the holders of
ordinary shares.
Details of share options outstanding as at 30 June 2024:
Grant date Expiry date Exercise price £ Share options
30 June 2020 29 June 2030 1.475 516,000
24 June 2021 23 June 2031 3.090 996,000
22 June 2022 30 June 2027 3.575 1,188,333
22 May 2023 21 May 2028 3.270 1,288,333
11 June 2024 10 June 2029 4.135 1,305,000
Total 5,273,666
Weighted average Share options
exercise price £
At 1 January 2024 2.968 4,848,500
Options executed during the year 2.449 (879,834)
Granted during the year 4.135 1,305,000
30 June 2024 3.343 5,273,666
Warrants
As at 30 June 2024 and 2023 there were no warrants.
15. Other reserves
(Euro 000's) FV reserve of financial assets at FVOCI ((2)) Non-Distributable reserve ((3)) Total
Share option Bonus share Depletion factor ((1)) Distributable
reserve ((4))
At 1 January 2023 10,365 208 37,778 (1,153) 8,316 14,291 69,805
Recognition of share- based payments 330 - - - - - 330
Change in fair value of financial assets at fair value through OCI - - - (4) - - (4)
At 30 June 2023 10,695 208 37,778 (1,157) 8,316 14,291 70,131
331 - - - - - 331
Recognition of share-based payments
Change in fair value of financial assets at fair value through OCI - - - 1 - - 1
At 31 December 2023 11,026 208 37,778 (1,156) 8,316 14,291 70,463
Recognition of share-based payments 302 - - - - - 302
Recognition of non-distributable reserve - - - - 142 - 142
Recognition of distributable reserve - - - - - 9,297 9,297
Recognition of depletion factor - - 7,500 - - - 7,500
At 30 June 2024 11,328 208 45,278 (1,156) 8,458 23,588 87,704
((1) ) Depletion factor reserve
At 30 June 2024, the Group has recognised €7.5 million (30 June 2023:
€nil) as a depletion factor reserve as per the Spanish Corporate Tax Act.
((2) ) Fair value reserve of financial assets at FVOCI
The Group has elected to recognise changes in the fair value of certain
investments in equity securities in OCI, as explained in (1) above. These
changes are accumulated within the FVOCI reserve within equity. The Group
transfers amounts from this reserve to retained earnings when the relevant
equity securities are derecognised.
((3) ) Non-distributable reserve
To comply with Spanish Law, the Group needed to record a reserve of profits
generated equal to a 10% of profit/(loss) for the year until 20% of share
capital is reached.
((4) ) Distributable reserve
The Group reclassified at least 10% of the profit of 2023 to distributable
reserves.
16. Trade and other payables
(Euro 000's) 30 Jun 2024 31 Dec 2023
Non-current
Other non-current payables 2,750 2,003
Government grant 1,356 202
4,106 2,205
Current
Trade payables 67,605 70,303
Trade payables to shareholders (Note 22.3) 114 179
Accruals 4,712 3,395
VAT payables 75 391
Other 895 1,654
73,401 75,922
Other non-current payables are related with the acquisition of Atalaya Ossa
Morena S.L. (former Rio Narcea Nickel S.L.) and Atalaya Masa Valverde, S.L.U.
(former Cambridge Mineria España, S.L.).
Trade payables are mainly for the acquisition of materials, supplies and other
services. These payables do not accrue interest and no guarantees have been
granted. The fair value of trade and other payables approximate their book
values. Trade payables are non-interest-bearing and are normally settled on
60-day terms.
17. Provisions
(Euro 000's) Other provisions Legal costs Rehabilitation costs Total costs
At 1 January 2023 1,435 226 23,374 25,035
Used of provision - - (294) (294)
Increase in provision - - 2,542 2,542
Finance cost - - 553 553
At 30 June 2023 1,435 226 26,175 27,836
Additions - 1 - 1
Increase in provision - - 603 603
Use of provision (685) - (224) (909)
Finance cost - - 137 137
At 31 December 2023 750 227 26,691 27,668
Use of provision - (34) (297) (331)
Increase in provision - - 740 740
Finance cost - - 107 107
Transfer to other non-current payables (750) - - (750)
At 30 June 2024 - 193 27,241 27,434
(Euro 000's) 30 Jun 2024 31 Dec 2023
Non-current 27,271 27,234
Current 163 434
Total 27,434 27,668
Rehabilitation provision
Rehabilitation provision represents the accrued cost required to provide
adequate restoration and rehabilitation upon the completion of production
activities. These amounts will be settled when rehabilitation is undertaken,
generally over the project's life.
The discount rate used in the calculation of the net present value of the
liability as at 30 June 2024 was 3.66% (31 December 2023: 3.62%), which is the
15-year Spanish Government Bond rate for 2023. An inflation rate of 1%-5.70%
(31 December 2023: 1%-5.70%) is applied on annual basis.
Legal provision
The Group has been named a defendant in several legal actions in Spain, the
outcome of which is not determinable as at 30 June 2024. Management has
individually reviewed each case and established a provision of €0.2 million
as of 30 June 2024 (€0.2 million at 31 December 2023) for these claims,
which has been reflected in these unaudited interim condensed consolidated
financial statements.
Other provisions
The Group has classified during 2024 the amount related to the second and
final payment of the purchase agreement to acquire 100% of the shares of
Atalaya Masa Valverde, S.L.U. (formerly Cambridge Mineria España, S.L.) as
other long-term financial liabilities, due to current expectations around the
fulfilment of the last milestone.
18. Borrowings
(Euro 000's) 30 Jun 2024 31 Dec 2023
Non-current borrowings
Credit facilities 11,006 16,131
11,006 16,131
Current borrowings
Credit facilities 16,670 50,556
16,670 50,556
The Group had credit approval for facilities totalling €94.2 million
(€103.8 million at 31 December 2023).
Borrowing with fixed interest rates is 1.75%. Margins on borrowing with
variable interest rates, usually 12 months EURIBOR, range from 0.95% to 1.93%
with an average margin of 1.25%.
At 30 June 2024, the Group had used €27.7 million of its facilities and had
undrawn facilities of €66.5 million.
19. Lease liabilities
(Euro 000's) 30 Jun 2024 31 Dec 2023
Non-current
Lease liabilities 3,560 3,877
3,560 3,877
Current
Lease liabilities 485 501
485 501
Lease liabilities
The Group entered into lease arrangements for the renting of land which is
subject to the adoption of all requirements of IFRS 16 Leases. The Group has
elected not to recognise right-of-use assets and lease liabilities for
short-term leases that have a lease term of 12 months or less and leases of
low-value assets. Depreciation expense regarding leases amounts to €0.2
million (2023: €0.6 million) for the six month period ended 30 June 2024.
The land lease is set for a duration of thirteen years, with payments due at
the beginning of each month, increasing annually by an average of 1.5%. As of
30 June 2024, the remaining term of this lease is five and a half years.
(Euro 000's) 30 Jun 2024 31 Dec 2023
Minimum lease payments due:
- Within one year 485 501
- Two to five years 1,870 1,928
- Over five years 1,690 1,949
Present value of minimum lease payments due 4,045 4,378
(Euro 000's) Lease liabilities
At 1 January 2024 4,377
Interest expense 15
Lease payments (259)
Write-off (88)
At 30 June 2024 4,045
At 30 June 2024
Non-current liabilities 3,560
Current liabilities 485
4,045
20. Acquisition, incorporation and disposal of subsidiaries
There were no acquisitions or incorporation of subsidiaries during the six
month period ended 30 June 2024 and 2023.
21. Winding-up of subsidiaries
There were no operations wound up during the six month period ended 30 June
2024 and 2023.
22. Related party transactions
The following transactions were carried out with related parties:
22.1 Compensation of key management personnel
The total remuneration and fees of Directors (including Executive Directors)
and other key management personnel was as follows:
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023 Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Directors' remuneration and fees 293 187 590 547
Directors' bonus ((1)) 327 322 327 322
Share option-based benefits and other benefits to directors 47 75 95 95
Key management personnel fees 158 86 307 290
Key management bonus ((1)) 247 221 247 221
Share option-based and other benefits to key management personnel 47 75 95 95
1,119 966 1,661 1,570
((1) ) These amounts related to the performance bonus for 2023
approved by the Board of Directors of the Company during H1 2024. Director's
bonus relates to the amount approved for the CEO as an executive director and
key management bonus relates to the amount approved for other key management
personnel which are not directors of Atalaya Mining plc.
22.2 Share-based benefits
On 12 June 2024, the Company announced that in accordance with the Company's
Long Term Incentive Plan 2020 which was approved by shareholders at the Annual
General Meeting on 25 June 2020, it has granted 1,305,000 share options to
Persons Discharging Managerial Responsibilities and other management.
The Options expire on 10 June 2029, five years from the deemed date of grant
(11 June 2024), have an exercise price of 413.5 pence per ordinary share,
being the last mid-market closing price on the grant date, and vest in three
equal tranches, one third on grant and the balance equally on the first and
second anniversary of the grant date.
22.3 Transactions with related parties/shareholders
i) Transaction with shareholders
(Euro 000's) Three month period ended 30 Jun 2024 Three month period ended 30 June 2023
Six month period ended 30 Jun 2024 Six month period ended 30 Jun 2023
Trafigura Pte Ltd- Revenue from contracts ((a)) 17,702 21,526 37,648 33,820
Gain / (losses) relating provisional pricing within sales (2,299) 746 (2,544) 2,848
15,403 22,272 35,104 36,668
Impala Terminals Huelva S.L.U. - Port Handling and Warehousing services ((b)) (796) (566) (1,212) (1,112)
Trafigura - Total revenue from contracts 14,607 21,706 33,892 35,556
(a) Offtake agreement and spot sales to Trafigura
Offtake agreement
In May 2015, the Company agreed terms with key stakeholders in a
capitalisation exercise to finance the re-start of Proyecto Riotinto (the
"2015 Capitalisation").
As part of the 2015 Capitalisation, the Company entered into offtake
agreements with some of its large shareholders, one of which was Trafigura Pte
Ltd ("Trafigura"), under which the total forecast concentrate production from
Proyecto Riotinto was committed ("2015 Offtake Agreements").
During Q2 2024, the Company completed 9 sales transactions under the terms of
the 2015 Offtake Agreements valued at €97.1 million (Q2 2023: 3 sales valued
at €22.9 million).
Spot Sales Agreements
Due to various expansions implemented at Proyecto Riotinto in recent years,
volumes of concentrate have been periodically available for sale outside of
the Company's various 2015 Offtake Agreements.
In Q2 2024, the Company completed nil spot sales (Q2 2023: nil spot sales
valued at €nil) There was an adjustment of negative €0.2 million in Q2
2024 which related to QP adjustments registered in Q2 2024 relating to spot
sales made in the previous year.
Sales transactions with related parties are at arm's length basis in a similar
manner to transactions with third parties.
(b) Port Handling and Warehousing services
In September 2015, Atalaya entered into a services agreement with Impala
Terminals Huelva S.L.U. ("Impala Terminals") for the handling, storage and
shipping of copper concentrates produced from Proyecto Riotinto. The agreement
covered total export concentrate volumes produced from Proyecto Riotinto for
three years for volumes not committed to Trafigura under its 2015 Offtake
Agreement and for the life of mine for the volumes committed to Trafigura
under its 2015 Offtake Agreement.
In September 2018, the Company entered into an amendment to the 2015 Port
Handling Agreement, which included improved financial terms and a five year
extension.
In December 2023, the Company entered into an extension of the service
agreement with Impala Terminals for the handling, storage and shipping of
copper concentrates produced from Proyecto Riotinto on similar terms than the
2015 agreement and the extension in 2018. This extension has a term of
approximately five years and covers the concentrate volumes produced for
export from Proyecto Riotinto that are not already committed to the Trafigura
Group under its 2015 Offtake Agreement.
As at 30 June 2024, Impala Terminals was part of the Trafigura Group, under
joint control.
ii) Period-end balances with related parties
(Euro 000's) 30 Jun 2024 31 Dec 2023
Receivables from related parties:
Recursos Cuenca Minera S.L. 56 56
Total (Note 12) 56 56
The above balances bear no interest and are repayable on demand.
iii) Period-end balances with shareholders
(Euro 000's) 30 Jun 2024 31 Dec 2023
Receivable from shareholder (Note 12)
Trafigura - Debtor balance- subject to provisional pricing 2,339 5,054
Trafigura - Debtor balance- at amortised cost - -
2,339 5,054
Payable to joint venture of shareholder (Note 16)
Impala Terminals Huelva S.L.U. - Payable balance (114) (179)
(114) (179)
The above debtor balance arising from sales of goods and other balances bear
no interest and is repayable on demand.
23. Contingent liabilities
Judicial and administrative cases
In the normal course of business, the Group may be involved in legal
proceedings, claims and assessments. Such matters are subject to many
uncertainties, and outcomes are not predictable with assurance. Legal fees for
such matters are expensed as incurred and the Group accrues for adverse
outcomes as they become probable and estimable.
24. Commitments
There are no minimum exploration requirements at Proyecto Riotinto. However,
the Group is obliged to pay local land taxes which currently are approximately
€235,000 per year in Spain and the Group is required to maintain the
Riotinto site in compliance with all applicable regulatory requirements.
In 2012, ARM entered into a 50/50 joint venture with Rumbo to evaluate and
exploit the potential of the class B resources in the tailings dam and waste
areas at Proyecto Riotinto (mainly residual gold and silver in the old gossan
tailings). Under the joint venture agreement, ARM will be the operator of the
joint venture, will reimburse Rumbo for the costs associated with the
application for classification of the Class B resources and will fund the
initial expenditure of a feasibility study up to a maximum of €2.0 million.
Costs are then borne by the joint venture partners in accordance with their
respective ownership interests.
25. Significant events
Ongoing geopolitical events are impacting the global economy, but the full
implications cannot yet be predicted. Key impacts include higher and more
volatile input costs and disruptions to freight and logistics. The financial
consequences of these events cannot be estimated with any reasonable degree of
certainty at this stage.
· On 9 February 2024, the Company issued 20,000 ordinary shares of
7.5p in the Company pursuant to an exercise of share options by a former
employee.
· On 25 April 2024, BlackRock, Inc., shareholder of the Company,
decreased its voting rights from 4.07% to 4.05%, and on 26 April decreased its
voting rights to 3.97%.
· Following the publication the prospectus in relation to the
admission of its ordinary shares ("Ordinary Shares") to the premium listing
segment of the Official List of the Financial Conduct Authority ("FCA"), which
took place on 24 April 2024, Atalaya was admitted to the premium listing
segment and to trading on London Stock Exchange plc's main market for listed
securities (together, "Admission") on 29 April and cancelled from trading on
AIM.
· On 7 May 2024, the Company issued 66,500 ordinary shares of 7.5p
in the Company pursuant to an exercise of share options by non-PDMR employees.
· On 22 May 2024, the Company issued 600,000 ordinary shares of
7.5p in the Company pursuant to an exercise of share options by a PDMR
employee.
· On 12 June 2024, the Company announced that in accordance with
the Company's Long Term Incentive Plan 2020 which was approved by shareholders
at the Annual General Meeting on 25 June 2020, it has granted 1,305,000 share
options to PDMR and other management.
· On 27 June 2024, the Company issued 193,334 ordinary shares of
7.5p in the Company pursuant to an exercise of share options by an employee.
26. Events after the Reporting Period
· On 17 July 2024, Cobas Asset Management SGIIC, S.A., shareholder
of the Company, increased its voting rights from 10.04% to 15.04%.
· Following the approval of Resolution 10 by the Company's
shareholders at its 2024 Annual General Meeting, which took place on 27 June
2024, the 2023 Final Dividend of US$0.04 per ordinary share was paid on 9
August 2024.
· On 13 August 2024, the Company's Board of Directors elected to
declare a 2024 Interim Dividend of US$0.04 per ordinary share, which is
equivalent to approximately 3.1 pence per share.
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