REG - Tertiary Minerals - Half-Yearly Report 2024
29/05/2024 10:45
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RNS Number : 2795Q Tertiary Minerals PLC 29 May 2024
29 May 2024
("Tertiary" or "the Company")
HALF-YEARLY REPORT 2024
Tertiary Minerals ("Tertiary" or the "Company") plc is pleased to announce its
unaudited interim results for the six-month period ended 31 March 2024.
Six Month Operational highlights:
Tertiary continues to develop its portfolio of copper and precious metal
exploration projects in Zambia and Nevada, USA.
Zambia
The Company now has interests in five copper exploration projects in Zambia.
Konkola West Copper Project
· Earn-in and joint venture agreement signed with KoBold Metals
Resources ("KoBold") and Mwashia Resources Limited ("Mwashia").
· KoBold is committed to drilling two deep holes to test the Konkola
West basin for projected deep extensions to the world class ore-shale deposit
being mined at the adjacent Konkola-Lubambe-Musoshi mines.
· Drilling of the first hole is progressing well and has potential to
deliver transformative results for the Company.
Jacks Copper Project
· Planning for the dry exploration season well underway with further
drilling budgeted to follow up on favourable 2022 drilling and soil sampling
results.
Mukai Copper Project
· Joint Venture negotiations underway with drilling planned for the
coming season.
Mushima North Copper Project
· Induced Polarisation ("IP") survey initiated to assist drill
testing of C1 and A1 targets this dry season (May to November). Drill planning
is at an advanced stage with quotes received and forest approvals in place.
Mupala Copper Project
· Environmental Project Brief now approved and exploration consent
received from local Chief, clearing the way for exploration to start. Soil
sampling programme is planned to validate historical copper soil anomalies.
Corporate
· The Company has signed a new joint venture agreement (the "JVA")
with local partner Mwashia to consolidate ownership of the Jacks, Mukai and
Mushima North exploration licences into a single, new Zambian company,
Copernicus Minerals Limited ("Copernicus"), owned 90% by Tertiary's 96% owned
subsidiary, Tertiary Minerals (Zambia) Limited ("TMZ"), and 10% by Mwashia.
· Ministerial consent has been granted for JVA and licence transfers
to Copernicus pending tax clearances.
Nevada, USA
Brunton Pass Copper Gold Project
· IP and Resistivity geophysical survey has defined a coherent
electrical chargeability anomaly over total target strike length of 700m.
· IP anomaly typical of sulphide mineralisation prospective for
copper and/or gold extends through all IP survey lines.
· Chargeability anomaly is spatially related to previously identified
copper-mercury-arsenic soil anomalies and copper and mercury-arsenic (+/-gold)
mineralised outcrops and trenches.
· Chargeability anomaly is a high priority drill target for
epithermal gold and/or porphyry copper mineralisation.
Sweden
· Storuman Fluorspar Project contains combined Indicated and Inferred
Mineral Resources of 27.7 million tonnes grading 10.2% fluorspar.
· Mining Inspectorate is re-examining its 2019 decision not to grant
the exploitation concession following Government's annulment of this decision
and has recently advised that a new decision will be made quickly.
· The Company has made a further submission to the Mining
Inspectorate in support of this new decision, highlighting the EU critical
minerals status of fluorspar as a battery mineral.
FINANCIAL SUMMARY FOR THE SIX-MONTH PERIOD ENDED 31 MARCH 2024:
· Operating Loss of £269,661 comprises:
o Revenue of £77,385; less administration costs of £312,671 (which
includes non-cash share-based payments of £19,664).
o Pre-licence and reconnaissance exploration costs totalling £33,798.
o Impairment of deferred exploration asset totalled £577.
· Total Group Loss of £269,485 after crediting interest income of
£176.
· Project expenditure of £85,903 was capitalised during the
six-month period.
Funding and Cash Position:
· In November 2023 and February 2024, the Company completed
fundraisings with Peterhouse Capital Limited raising £150,000 and £375,000
respectively before expenses.
The Company's closing cash (and cash equivalent) position at the end of the
period was £251,135.
Chairman's Statement
I am pleased to present our Interim Report for the six-month period ended 31
March 2024 and a summary of our principal exploration and corporate activities
exploring for copper and precious metals in Zambia and in Nevada, USA.
Copper is very much in the news with copper prices breaching the US$10,000 per
tonne mark and some pundits predicting much higher copper prices to come.
This, of course, is driven by copper's importance as the key green energy
transition metal used in renewable power generation and electric vehicles
where its properties of electrical conductivity, efficiency, ductility and
recyclability make it virtually irreplaceable.
The Company's focus is currently on the Konkola West Project which lies
adjacent to and covers projected, deep, down dip extensions to the
Lumambe-Konkola mining complexes where KoBold Metals ("KoBold") is also
developing the Mingomba deposit with backing from Silicon Valley investors and
where Vedanta has announced a US$1 billion investment into the Konkola copper
mine. KoBold now believes that the nearby Mingomba Project will become one of
the world's top three high-grade copper mines.
A conditional agreement was signed with KoBold allowing KoBold to earn-into
Konkola West in December 2023 and KoBold began drilling soon after the
satisfaction of conditions precedent for various Ministerial approvals which
occurred in April. The first of two planned drill holes is now well underway
and on my visit to the drill site last month, it was clear that no expense or
effort is being spared by KoBold to make this exploration work a success.
Drilling is progressing well and so far the stratigraphy being intersected is
consistent with that seen in the adjacent mines. We are unable to predict the
depth at which the "ore-shale" might be found due to variations in thickness
and dip/strike of the overlying units across the basin, but we don't expect
the first hole to be completed before mid-June and analytical results will
only be available some time after that.
In the meantime, we are gearing up to drill on our Mushima North and Jacks
copper projects this summer and autumn. This will include a programme of
geophysics at Mushima North to help focus the drilling at the C1 and A1 copper
soil anomalies and pitting at Jack's to better discriminate anomalies there.
Drill quotes have been obtained and forest access permits have been granted.
At Mukai we have interest from other parties which may lead to a joint venture
agreement, but we will also be seeking to ensure that drilling takes place
this dry season regardless of the outcome of these discussions.
In February, we signed a conditional joint venture agreement with local
partner Mwashia to consolidate ownership of the Mushima North, Jacks and Mukai
exploration licences (the "Licences") into a single, new Zambian company,
Copernicus Minerals Limited ("Copernicus"), now owned 90% by Tertiary's 96%
owned subsidiary, Tertiary Minerals (Zambia) Limited ("TMZ"), and 10% by
Mwashia. The JV agreement and transfer of the licences to Copernicus has now
received Ministerial consent and transfer of the licences to Copernicus is
pending tax clearance. This new agreement simplifies our corporate structure
in Zambia and creates a vehicle by which the partners can better consider
joint venture approaches from third parties on the Licences.
We also recently reported that all consents have now been received to allow us
to commence exploration at our new Mupala Project where a recent review of
historical exploration and mine development on adjacent areas by majors such
as First Quantum Minerals and Anglo American highlights the prospectivity of
the Licence. The Licence was granted to the Company in competition with
several other applicants, including Anglo American Corporation which has now
started exploration that will include diamond drilling on adjacent licences.
Our exploration in Nevada, USA, has taken a backseat to our work in Zambia but
work continues on our lead project there, Brunton Pass, where we recently
reported encouraging results from a geophysical survey. The IP anomaly defined
by this survey is large and present over the full 700m length tested by the
survey and all the results from our previous rock, soil and trench sampling
all vector towards this anomaly which is now a compelling drill target for the
discovery of an epithermal gold and/or porphyry deposit.
In Sweden, following the Government's decision to annul the Mining
Inspectorate's decision to refuse grant of an exploitation concession for the
Storuman Fluorspar Deposit, we are awaiting a revised decision. In April, the
Company made a further submission to the Mining Inspectorate in support of
this new decision, highlighting the EU critical minerals status of fluorspar,
an important battery mineral used in the manufacture of LiPF6, the main salt
used in lithium-ion battery electrolytes. Whilst there is no specific
deadline, the Mining Inspectorate has recently advised that it intends to make
its decision as soon as possible.
Our Storuman Fluorspar Project contains combined Indicated and Inferred
Mineral Resources of 27.7 million tonnes grading 10.2% fluorspar in a mineral
deposit designated as being of National Interest in Sweden.
Our activities during the period have been funded through existing cash
resources and two share placings with joint broker Peterhouse Capital Limited
that raised a total of £525,000 before expenses.
In 2024, we expect to reap the benefits of the foundations laid in 2023 when
we carried out generative exploration across all of our projects in Zambia
aimed at identifying drill targets. The strategic location of our Zambian
projects places Tertiary at the heart of Zambia's mining boom and we look
forward to providing updates on our exploration season as it unfolds.
Patrick L Cheetham
Executive Chairman
29 May 2024
Consolidated Income Statement
for the six-months' period to 31 March 2024
Six months Six months Twelve months
to 31 March to 31 March to 30 September
2024 2023 2023
Unaudited Unaudited Audited
£ £ £
Revenue 77,385 75,944 181,429
Administration costs (312,671) (294,796) (572,604)
Pre-licence exploration costs/impairment costs (33,798) (34,237) (39,792)
Impairment of deferred exploration asset
(577) - (111,691)
Operating loss (269,661) (253,089) (542,658)
Interest receivable 176 235 1,317
Loss before income tax (269,485) (252,854) (541,341)
Income tax - - -
Loss for the period attributable to equity holders of the parent
(269,485) (252,854) (541,341)
Loss per share - basic and diluted (pence) (Note 2) (0.01) (0.02) (0.03)
Consolidated Statement of Comprehensive Income
for the six-months' period to 31 March 2024
Six months to Six months to Twelve months to
31 March 31 March 30 September
2024 2023 2023
Unaudited Unaudited Audited
£ £ £
Loss for the period
(269,485) (252,854) (541,341)
Items that could be reclassified subsequently
to the Income Statement:
Foreign exchange translation differences on foreign currency net investments
in subsidiaries
24,071 (44,041) (23,612)
Items that will not be reclassified to the Income Statement:
Changes in the fair value of equity investments (6,038) (3,647) (5,184)
Total comprehensive loss for the period attributable to equity holders of the
parent
(251,452) (300,542) (570,137)
Company Registration Number 03821411
Consolidated Statement of Financial Position
at 31 March 2024
As at As at As at
31 March 31 March 30 September
2024 2023 2023
Unaudited Unaudited Audited
£ £ £
Non-current assets
Intangible assets 686,298 603,889 620,481
Property, plant & equipment 6,216 2,476 3,234
Other investments 10,428 18,003 16,466
702,942 624,368 640,181
Current assets
Receivables 139,656 62,857 114,432
Cash and cash equivalents 251,135 217,967 121,813
390,791 280,824 236,245
Current liabilities
Trade and other payables (64,440) (67,815) (69,835)
Net current assets
326,351 213,009 166,410
Provisions for liabilities and charges (9,591) (13,825) (11,496)
Net assets 1,019,702 823,552 795,095
Equity
Called up Ordinary Shares 257,483 180,251 198,108
Share premium account 13,034,938 12,379,636 12,599,278
Capital redemption reserve 2,644,061 2,644,061 2,644,061
Merger reserve 131,096 131,096 131,096
Share option reserve 69,585 105,931 88,562
Fair value reserve (28,238) (20,663) (22,200)
Foreign currency reserve 422,287 416,428 436,857
Accumulated losses (15,511,510) (15,013,188) (15,280,667)
Equity attributable to the owners of the parent 1,019,702 823,552 795,095
Consolidated Statement of Changes in Equity
Capital redemption reserve
Ordinary Share Share Fair Foreign
Share Premium Merger Warrant Value Currency Accumulated
Capital Account Reserve Reserve Reserve Reserve Losses Total
£ £ £ £ £ £ £ £
At 30 September 2022 153,626 12,101,761 2,644,061 131,096 101,985 (17,016) 460,469 (14,770,533) 805,449
Loss for the period - - - - - - - (252,854) (252,854)
Change in fair value - - - - - (3,647) - - (3,647)
Exchange differences - - - - - - (44,041) - (44,041)
Total comprehensive loss for the period - - - - - (3,647) (44,041) (252,854) (300,542)
Share issue 26,625 277,875 - - - - - - 304,500
Share based payments expense - - - - 14,145 - - - 14,145
Transfer of expired warrants - - - - (10,199) - - 10,199 -
At 31 March 2023 180,251 12,379,636 2,644,061 131,096 105,931 (20,663) 416,428 (15,013,188) 823,552
Loss for the period - - - - - - - (288,487) (288,487)
Change in fair value - - - - - (1,537) - - (1,537)
Exchange differences - - - - - - 20,429 - 20,429
Total comprehensive loss for the period - - - - - (1,537) 20,429 (288,487) (269,595)
Share issue 17,857 219,642 - - - - - - 237,499
Share based payments expense - - - - 3,639 - - - 3,639
Transfer of expired warrants - - - - (21,008) - - 21,008 -
At 30 September 2023 198,108 12,599,278 2,644,061 131,096 88,562 (22,200) 436,857 (15,280,667) 795,095
Loss for the period - - - - - - - (269,485) (308,125)
Change in fair value - - - - - (6,038) - - (6,038)
Exchange differences - - - - - - (14,569) - (14,569)
Total comprehensive loss for the period - - - - - (6,038) (14,569) (269,485) (290,092)
Share issue 59,375 435,660 - - - - - - 495,035
Share based payments expense - - - - 19,664 - - - 19,664
Transfer of expired warrants - - - - (38,641) - - 38,641 -
At 31 March 2024 257,483 13,034,938 2,644,061 131,096 69,585 (28,238) 422,288 (15,511,511) 1,019,702
Consolidated Statement of Cash Flows
for the six-months' period to 31 March 2024
Six months Six months Twelve months
to 31 March to 31 March to 30 September
2024 2023 2023
Unaudited Unaudited Audited
£ £ £
Operating activity
Operating Loss (269,661) (253,089) (542,658)
Depreciation charge 1,093 768 1,793
Share based payment charge 19,664 14,145 17,784
Broker fee paid in shares - 4,500 -
Impairment of deferred exploration asset - - 111,691
Reclamation provision - - -
(Increase)/decrease in receivables (25,224) 209,810 1,643
Increase/(decrease) in payables (5,395) (13,114) (11,094)
Net cash outflow from operating activity (279,523) (36,980) (420,841)
Investing activity
Interest received 176 235 1,317
Proceeds on disposal of royalty assets - - 156,594
Exploration and development expenditures (85,903) (115,162) (236,808)
Purchase of property, plant & equipment (4,073) (769) (2,630)
Cash receipt from disposal of equity investments - 28,333 -
Net cash outflow from investing activity (89,800) (87,363) (81,527)
Financing activity
Issue of share capital (net of expenses) 495,035 304,500 541,999
Net cash inflow from financing activity 495,035 304,500 541,999
Net increase/(decrease) in cash and cash equivalents 39,631
125,712 180,157
Cash and cash equivalents at start of period 121,813 59,414 59,414
Exchange differences 3,610 (21,604) 22,768
121,813
Cash and cash equivalents at end of period 251,135 217,967
Notes to the Interim Statement
1. Basis of preparation
The consolidated interim financial information has been prepared in accordance
with the accounting policies that are expected to be adopted in the Group's
full financial statements for the year ending 30 September 2024 which are not
expected to be significantly different to those set out in Note 1 of the
Group's audited financial statements for the year ended 30 September 2023.
These are based on the recognition and measurement requirements of applicable
law and UK adopted International Accounting Standards. The financial
information has not been prepared (and is not required to be prepared) in
accordance with IAS 34. The accounting policies have been applied consistently
throughout the Group for the purposes of preparation of this financial
information.
The financial information in this statement relating to the six-month period
ended 31 March 2024 and the six-month period ended 31 March 2023 has neither
been audited nor reviewed by the Independent Auditor, pursuant to guidance
issued by the Auditing Practices Board. The financial information presented
for the year ended 30 September 2023 does not constitute the full statutory
accounts for that period. The Annual Report and Financial Statements for the
year ended 30 September 2023 have been filed with the Registrar of Companies.
The Independent Auditor's Report on the Annual Report and Financial Statement
for the year ended 30 September 2023 was unqualified, although it did draw
attention to matters by way of emphasis in relation to going concern, and did
not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
The directors prepare annual budgets and cash flow projections for a 15-month
period. These projections include the proceeds of future fundraising necessary
within the period to meet the Company's and the Group's planned discretionary
project expenditures and to maintain the Company and the Group as a going
concern. Although the Company has been successful in raising finance in the
past, there is no assurance that it will obtain adequate finance in the
future. These factors represent a material uncertainty related to events or
conditions which may cast significant doubt on the entity's ability to
continue as a going concern and, therefore, that it may be unable to realise
its assets and discharge its liabilities in the normal course of business.
However, the directors have a reasonable expectation that they will secure
additional funding when required to continue meeting corporate overheads and
exploration costs for the foreseeable future and therefore believe that the
going concern basis is appropriate for the preparation of the financial
statements.
2. Loss per share
Loss per share has been calculated on the attributable loss for the period and
the weighted average number of shares in issue during the period.
Six months Six months Twelve months
to 31 March to 31 March to 30 September
2024 2023 2023
Unaudited Unaudited Audited
Loss for the period (£) (269,485) (252,854) (541,341)
Weighted average shares in issue (No.) 2,203,762,645 1,340,117,157 1,791,815,969
Basic and diluted loss per share (pence) (0.01) (0.02) (0.03)
The loss attributable to ordinary shareholders and the weighted average number
of ordinary shares used for the purpose of calculating diluted earnings per
share are identical to those used to calculate the basic earnings per ordinary
share. This is because the exercise of share warrants would have the effect of
reducing the loss per ordinary share and is therefore not dilutive under the
terms of IAS33.
3. Share capital
During the six-month period to 31 March 2024 the following share issues took
place:
An issue of 125,000,000 0.01p Ordinary Shares at 0.12p per share, by way of
placing, for a total consideration of £150,000 before expenses (1 November
2023).
An issue of 468,750,000 0.01p Ordinary Shares at 0.08p per share, by way of
placing, for a total consideration of £375,000 before expenses (12 February
2024).
The total number of Ordinary Shares in issue on 31 March 2024 was
2,574,835,049 (30 September 2023: 1,981,085,049).
4. Warrants
On 14 February 2024, the Company granted 10,000,000 five-year warrants to
subscribe for new Ordinary Shares to employees and directors of the Company as
part of their remuneration.
The total number of warrants in issue at 31 March 2024 was 69,887,500, with
subscription prices ranging from 0.080 to 1.50 pence per share.
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