14. August 2019
Serabi Gold plc
("Serabi" or "Company")
Unaudited Interim Report for the Three-Month and Six-Month Durations to June 30, 2019 and Management Discussion and Analysis
Serabi Gold (AIM: SRB, TSX: SBI), a Brazilian-based gold mining and improvement company, at present publishes its unaudited interim report for the three-month and six-month durations ended June 30, 2019, whereas a administration dialogue and analysis has been revealed for the similar period.
- EBITDA for the second quarter was $ three.three million, up 23% from the similar interval in 2018.
- EBITDA for the yr. $ 7.6 million, up 35% compared to the similar period in 2018.
- Earnings earlier than tax have been $ 3.four million for the period, 2.92 cents per share.
- Money belongings at finish of June 2019 $ 12.4. million US $ three.1 million after the end of 2018.
- Up to now, AISC was $ 1,085 an oz, money costs are $ 860 an oz.
- Second-quarter working money movement was $ three.0 million ($ 2.3 million). after mine improvement prices), in comparison with $ 1.4 million ($ 0.3 million after mine improvement prices) for the similar period in 2018.
- Operating money move to date is $ 9.four million ($ 7.9 million after mine improvement prices)) To $ four.5 million ($ 2.5 million after mine improvement costs) for the similar period in 2018.
- Greater second-quarter funding costs mirror $ zero.eight million in ore sorter.
| 6 months –
June 30, 2019
| three months –
June 30, 2019
| 6 months –
June 30, 2018
| three months –
June 30, 2018
|turnover||29,585,739  12,459,699||25,700,634  11,873,783  Gross sales Value  (19,164,989)  (7,803,002)  (17,272,887)||[7 753 782] 10,420,750||4,656,697||8,427 747||four,zero89,997  Administration and share rewards||(2,803,500)  (1,378,996)  (2,780,485)||(1,422 19659021) 7,617,250||] three,277,701||5,647,262  2,667,114  Depreciation and amortization||(four,250,501)  (1,960,956||(4,490,900) revenue / (loss) before finance and taxes||3,366,749||1,316,745  1,156,362||169,067|
|profit / (loss) after taxes||1,719,640||169,678||( 482,634)||(493,420)|
|earnings per share (19659061) 2.92c||0 .29c||(1.10c)||(zero.94c)|
|common gold worth obtained||$ 1,287||$ 1,292||. ] $ 1,309||$ 1,296|
December 31, 2018
|Cash and bank receivables||12,366,683||9,216 048|
|Internet Belongings||. 19659021] 71 452 748||69 110 287|
|cash and all-in upkeep costs ("AISC")||.|
|6 months June 30, 2019|| 6 months –
June 30, 2018
| 12 months –
December 31, 2018
|gold production for cash and AISC functions||[1 9659026] 19 691 ounces||18 751 ounces||37 108 ounces|
|complete production value (per ounce)||19659026] $ 861||$ 821|
|complete manufacturing AISC (per ounce)||$ 1,zero85||$ 1,121||$ 1,093|
OPERATING AND DEVELOPMENT quarter. gold production of 9,527 ounces of gold, with complete manufacturing of approximately 19,700 ounces in the corresponding interval final yr, an increase of 5% over the corresponding period in 2018.
Key Operational Knowledge
|||SUMMARY PRODUCTION STATISTICS FOR 2019 AND 2018 CALENDAR YEAR|
|Qtr 1||Qtr 2||Complete||Qtr 1||Qtr 1||Qtr 1||Qtr||Qtr four||Complete|
|gold manufacturing (1) (2)||ounces|| 16164. 19659170] 19691||9188||9563||8101||10256||37108|
|ore mined – complete||tonnes||42,609||44,784||87,393||39,669  19659171] 19,259 |
|gold grade (g / t)||7.47||6.72||7.08||7.49||8.12||] 6.23||6.23] 7.29|
|powdered ore||tonnes||43.four 19659170] 87 162||43 145||38 155||41 405||45,548||168,zero15,198 ]|
|gold grade (g / t)||7.69 [1965/672] 7.04||7.71||6.11||7.39||] 7.06|
| Horizontal Improvement||1,688||2,419||4,287||2,353||2,744||2,814||2,460||10,371|
- gold production figures might change until ultimate purchases are settled provided copper / gold concentrates and gold colors.
- Complete manufacturing in 2019 consists of handling of 10,892 tons of flotation tail at four.38 g / t (full yr 2018: 16,466 tons at 3.71 g / t). t)
- The table might not include the sum resulting from rounding.
Copies of the financial statements and MD&A could be accessed from the Company's website by following the hyperlinks under.
Mike Hodgson, CEO of Serab, comments:
. “This second quarter has as soon as again been very pleasant from an operational viewpoint. As we introduced in our second-quarter enterprise replace on July 22, we have been very close to producing more than 10,000 ounces for the third consecutive quarter. Second quarter economic efficiency represents a big improvement over Q1 2018, when gold manufacturing levels have been very comparable, and despite the average gold worth achieved in Q3 2018, we have been truly barely greater than our Q2 2019. money and money equivalents, considering the ongoing mine improvement prices, have been $ 2.3 million, a rise of $ 2.zero million compared to the corresponding quarter in 2018. It is recalled that the cash place acquired a big improve over the first two quarters of 2019. throughout the month by means of the sale of stock held at the finish of December 2018. Nevertheless, the Group's cash reserves have increased slightly in comparison with the state of affairs at the end of March 2019, which, following the $ 1.1 million purchase of equipment and gear in the yr, is cluding $ 800,000 associated to the remaining buy worth of ore sorter and import taxes levied in Brazil.
“Whereas manufacturing in this second quarter was barely lower than in the first quarter of 2019, AISC has declined barely but continues to be enhancing in comparison with 2018, and current gold worth improvements are anticipated by the authorities to continue its good working margin for the remainder of the yr. In comparison with Q2 2018, complete $ 7.8 million quarterly bills are corresponding to Q3 2018, but margin enchancment is attributable to fourth quarter gross sales progress of 9,667 ounces eight per cent larger than in Q1 2018 . Nevertheless, this enchancment in the worth of gold has had an influence on monetary bills for the financial yr. The implicit worth of the gold options granted by the Company to an insured lender in July 2017 has risen and resulted in a $ 427,000 revaluation cost for six months till June 30, 2019. In all different respects, our quarterly value profile continues to be fairly flat.
“Earlier this month, we announced the consultants' expected timetable to prepare for the Preliminary Economic Assessment (PEA) for Coringa. As we had previously advised, in our concerns about mine tailings dams, we have decided to move to a dry solution and abandon the conventional tailings dam. Our experts in Global Resource Engineering (“GRE”) have helped with the mandatory modifications in check drive, design, gear specs and dry stacked waste management answer, as well as in the course of design process. This has affected our potential to advance PEA at the tempo you previously hoped for, but in all other respects, the Coringa venture continues to be progressing, and there’s regular progress in securing permission and licenses, which places us able to start out undertaking improvement.
"Our current business is going well and July was another very good month of production that kept us on the right track to reach our annual production guidelines."
SERABI GOLD PLC
abstract of consolidated revenue for the three months
condensed consolidated stability sheets
SERABI GOLD PLC
Condensed Consolidated Statement of Modifications in Equity
19659379] different reserves (1)
- Other provisions include a $ 361,461 merger reserve and a $ 5,228,729 tax provision (December 31, 2018: $ 361,461 merger provision and $ four,402,358 tax provision).
SERABI GOLD PLC
Condensed Consolidated Cash Circulate Assertion
| for three months
on June 30
| ended for six months
on June 30, 2019
|]. ] 2018||2019||2018|
|(expressed in US dollars)||(unaudited)||(unaudited)||(unaudited)||(unaudited)|
|Enterprise  19659570]|
|after tax (loss) / profit for the interval||169,678||(493,420)||1,719,640||(482,634)|
|gear depreciation and mining properties||1,960,956||2,488,zero47||four,250,501||four,490,900|
|Internet financial bills||741,222  607,688||1,zero27,885||117|
|Revaluation reserve reserve||–||(200,000)||(500,000)||(200,000)|
|share-based funds||65,486||78,278||130,971||245,571  404,652||222,774  (382,801)||154,350|
|Modifications in working capital|
|(improve in receivables, prepayments and accrued revenue) (19659895) (376,417)||(1003,967) (1,003,967). 1,113,022)||(1,503,295)|
|improve / (decrease) in debt, service and provision||979,894||242,933||1,518,388||113,080  internet money move from operating activities  2 969 542||1387 185||9 436 126||four 484 114|
|acquisition charges||(120 988)||(4 740 928)||(1 156 zero65)||(four 740 928)|
|activated mine improvement prices||( 19,659,895). (1 064 966)||(1 492 563)||(2 030 489)|
|buy of property, plant and gear and development tasks||(1 071 564)||(892 233)||(1 461) 292)||(1,317,926)|
|Expenditure on geological survey||(208,062)||(1,443,384)||(796,524)||(2,011,802)|
|operational undertaking costs||(403,580). (496,049)||(843,522)||(1,289,479)|
|revenue from the sale of property||118,039||13,209||153,081||64,324  Interest acquired||–||–||2,217||34|
|Internet cash movement from investing activities||(2,340,408)||(8,624,351)||(5,594,688)||. (11,326,266)|
|provision of atypical share capital||. 23,807,346||–||23,807,346|
|Prices associated to the situation of share capital||–||(566,518)||–||(566,518)|
|[nostettuvakuuslaina19659896] –  –||three,000,000|
|Insured Loan Reimbursement||(195,zero43)||(666,667)||(195,zero43)||(1,000,000) [rahoitussopimukset19659894].||(81,573)||(143,063)||(267,178)||(426,210)|
|Curiosity paid and other financial expenses||(151,137)||(234,166)||])  (386,587)|
|internet cash circulate (outflow) / financial revenue||(427,753)||22,196,932||(766,154)||24,428,031|
|internet improve / (decrease) in cash and money equivalents||201,381||14,959,976||three,075,294||17,585,879|
|at beginning of period ] 6,695,526||9,216,048||4,093,866  31,590||(602,967)||75,341||(627,420)|
|cash and cash equivalents] 12366683||21052325||12366683||21052325|
1. Accounting Policies
These condensed interim financial statements are introduced for the three-month and six-month durations ended June 30, 2019. The comparative info has been introduced for the unaudited three-month and six-month period ended 30 June 2018 and, if crucial, for the audited 12-month interval 1 January 2018 – 31 December 2018. These condensed consolidated financial statements do not embrace all the info that may in any other case be required by they need to be read together with the 2018 Annual Report.
The condensed consolidated financial statements for the interval have been ready in accordance with Worldwide Accounting Normal 34, Interim Monetary Reporting, and the accounting policies are constant 31. Annual Accounts for the Yr Ended December 31, 2018 and Accounting Insurance policies Designed for the Monetary Statements. Yr ending December 31, 2019.
Accounting Requirements, Amended Standards and Interpretations Effective in 2019
The Group has not adopted any requirements or interpretations earlier than the required adoption dates.
IFRS 16 Leases entered into drive on 1 January 2019 and requires lessees to acknowledge all lease belongings and liabilities in the stability sheet for both finance leases and working leases. The adoption of IFRS 16 has not had a big impression on the consolidated financial statements as a result of the leases held by the Group are of little worth and most of the present leases either relate to service contracts or do not otherwise give rise to a proper to make use of fastened belongings or leases.
These monetary statements usually are not statutory accounts as defined in part 434 of the Corporations Act 2006.
- Persevering with operations
On June 30, 2019, the Group had cash and money equivalents of $ 12.three million and internet belongings of $ 71.5 million. The directors have reviewed the forecast cash movement of the Group for the subsequent 12 months. Based mostly on this forecast, which incorporates planned capital and exploration programmes, the Group might not be capable of generate enough money flows to settle, in full, the deferred consideration of US$12 million payable for the acquisition of Coringa which falls due in December 2019.
The Administrators consider there is a affordable prospect of the Group securing further funds as and when required so that the Group can meet all liabilities together with the deferred consideration payable for the acquisition of Coringa as and once they fall due in the subsequent 12 months and have ready the monetary statements on a going concern foundation.
As at the date of this report the consequence of raising further funds stays uncertain and this represents a cloth uncertainty surrounding going concern. If the Group fails to boost the essential funds the Group may be unable to understand its belongings and discharge its liabilities in the regular course of business. The issues defined indicate that a material uncertainty exists which will forged vital doubt on the Group and Mother or father’s capacity to proceed as a going concern. These monetary statements do not present the changes to the belongings and liabilities of the Group or the Father or mother firm if this was to occur.
(ii) Use of estimates and judgements
There have been no material revisions to the nature and amount of modifications in estimates of amounts reported in the 2018 annual financial statements.
At each stability sheet date, the Group evaluations the carrying amounts of its property, plant and gear and intangible belongings to determine whether or not there’s any indication that these belongings have suffered impairment. Previous to carrying out of impairment evaluations, the vital money producing models are assessed to find out whether or not they should be reviewed beneath the necessities of IFRS 6 – Exploration for and Analysis of Mineral Assets or IAS 36 – Impairment of Belongings. Such willpower is by reference to the stage of improvement of the venture and the degree of reliability and surety of data used in calculating value in use or truthful worth less costs to promote. Impairment critiques carried out underneath IFRS 6 are carried out on a undertaking by venture basis, with every challenge representing a potential single cash producing unit. An impairment evaluation is undertaken when indicators of impairment arise; sometimes when certainly one of the following circumstances applies:
(i) enough knowledge exists that render the useful resource uneconomic and unlikely to be developed
(ii) title to the asset is compromised
(iii) budgeted or deliberate expenditure is just not anticipated in the foreseeable future
(iv) inadequate discovery of commercially viable assets resulting in the discontinuation of activities
Impairment critiques performed underneath IAS 36 are carried out when there is an indication that the carrying worth could also be impaired. Such key indicators (although not exhaustive) to the business embrace:
(i) a big deterioration in the spot worth of gold
(ii) a big improve in production prices
(iii) a big revision to, and discount in, the lifetime of mine plan
If any indication of impairment exists, the recoverable amount of the asset is estimated, being the greater of truthful worth less costs to sell and worth in use. In assessing value in use, the estimated future money flows are discounted to their present worth utilizing a pre-tax low cost price that displays current market assessments of the time worth of cash and the dangers specific to the asset for which the estimates of future cash flows haven’t been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be lower than its carrying quantity, the carrying amount of the asset (or cash-generating unit) is lowered to its recoverable quantity. Such impairment losses are recognised in revenue or loss for the yr.
The place an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the elevated carrying quantity does not exceed the carrying quantity that may have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised in revenue or loss for the yr.
2. Finance Costs
|three months ended
30 June 2019
|3 months ended
30 June 2018
|6 months ended
30 June 2019
30 June 2018 (unaudited)
|Interest expense on secured loan||(150,956)||(205,479)||(300,540)||(357,899)|
|Unwinding of discount on acquisition cost||(270,750)||(246,137)||(532,271)||(483,883)|
|Arrangement payment for secured mortgage||—||—||—||(90,000)|
|Loss on revaluation of derivatives||(427,630)||—||(290,788)||—|
|Amortisation of truthful value of derivatives||—||(65,000)||—||(130,000)|
|Achieve on revaluation of derivatives||—||407,471||—||362,264|
|Internet finance expense||(689,736)||(109,145)||(961,782)||(699,484)|
The Group has recognised a deferred tax asset to the extent that the Group has affordable certainty as to the degree and timing of future income that may be generated and towards which the asset may be recovered. The Group has released the quantity of US$502,707 as a deferred tax charge throughout the six month interval to 30 June 2019.
The Group has additionally incurred a tax cost in Brazil for the six month interval of US$116,517.
4. Earnings per share
|three months ended 30 June 2019
|3 months ended 30 June 2018
|6 months ended 30 June 2019
|6 months ended 30 June 2018
|Profit / (loss) attributable to bizarre shareholders (US$)||169,678||(493,420)||1,719,640||(482,634)|
|Weighted common unusual shares in situation||58,909,551||52,529,475||58,909,551||43,821,118|
|Primary revenue / (loss) per share (US cents)||0.29c||(zero.94)||2.92c||(1.10)|
|Diluted atypical shares in problem||60,430,473(1)||52,529,475(1)||60,430,473(2)||43,821,118(1)|
|Diluted profit / (loss) per share (US cents)||zero.28c||(0.94c)||2.85c||(1.10c)|
- As the effect of dilution is to scale back the loss per share, the diluted shares in challenge are the similar as the primary shares in problem and the diluted loss per share is taken into account to be the similar as the primary loss per share.
- Based mostly on 1,520,922 options vested and exercisable as at 30 June 2019.
Nominated Adviser and Financial Adviser
Copies of this announcement are available from the Company’s website at www.serabigold.com.
Neither the Toronto Inventory Change, nor some other securities regulatory authority, has permitted or disapproved of the contents of this announcement.
The Company will, in compliance with Canadian regulatory necessities, submit the Unaudited Interim Financial Statements and the Management Discussion and Analysis for the three and six month durations ended 30 June 2019 on SEDAR at www.sedar.com. These paperwork may also obtainable from the Company’s website – www.serabigold.com.
Serabi’s Administrators Report and Financial Statements for the yr ended 31 December 2018 together the Chairman’s Statement and the Management Discussion and Evaluation, are available from the Company’s website – www.serabigold.com and on SEDAR at www.sedar.com.
This announcement is inside info for the functions of Article 7 of Regulation 596/2014. The one that arranged for the launch of this announcement on behalf of the Company was Clive Line, Director.
GLOSSARY OF TERMS
The following is a glossary of technical phrases:
“Au” means gold.
“assay” in financial geology, means to analyse the proportions of metallic in a rock or overburden sample; to check an ore or mineral for composition, purity, weight or other properties of economic interest.
“development” – excavations used to determine access to the mineralised rock and different workings.
“doré – a semi-pure alloy of gold silver and other metals produced by the smelting process at a mine that will be subject to further refining.
“DNPM” is the Departamento Nacional de Produção Mineral.
“grade” is the concentration of mineral inside the host rock sometimes quoted as grammes per tonne (g/t), elements per million (ppm) or elements per billion (ppb).
“g/t” means grammes per tonne.
“granodiorite” is an igneous intrusive rock just like granite.
“igneous” is a rock that has solidified from molten material or magma.
“Intrusive” is a body of igneous rock that invades older rocks.
“on-lode development” – Improvement that is undertaken in and following the course of the Vein.
“mRL” – depth in metres measured relative to a hard and fast level – in the case of Palito and Sao Chico this is sea-level. The mine entrance at Palito is at 250mRL.
“saprolite” is a weathered or decomposed clay‐rich rock.
“stoping blocks” – a discrete space of mineralised rock established for planning and scheduling purposes that might be mined using one in every of the numerous stoping methods.
“Vein” is a generic term to describe an prevalence of mineralised rock inside an space of non-mineralised rock.
Qualified Individuals Statement
The scientific and technical info contained inside this announcement has been reviewed and permitted by Michael Hodgson, a Director of the Firm. Mr Hodgson is an Financial Geologist by coaching with over 26 years’ expertise in the mining business. He holds a BSc (Hons) Geology, College of London, a MSc Mining Geology, University of Leicester and is a Fellow of the Institute of Materials, Minerals and Mining and a Chartered Engineer of the Engineering Council of UK, recognising him as both a Qualified Individual for the functions of Canadian Nationwide Instrument 43-101 and by the AIM Steerage Word on Mining and Oil & Fuel Corporations dated June 2009.
Forward Wanting Statements
Sure statements in this announcement are, or may be deemed to be, ahead wanting statements. Ahead wanting statements are identiﬁed by their use of phrases and phrases akin to ‘‘believe’’, ‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘will’’ or the damaging of those, variations or comparable expressions, including references to assumptions. These forward wanting statements aren’t based mostly on historical details but quite on the Directors’ present expectations and assumptions relating to the Firm’s future progress, outcomes of operations, performance, future capital and other expenditures (together with the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such ahead wanting statements reﬂect the Directors’ present beliefs and assumptions and are based mostly on info at present obtainable to the Directors. Numerous elements might cause actual results to differ materially from the outcomes discussed in the forward wanting statements including risks associated with vulnerability to common financial and enterprise circumstances, competitors, environmental and different regulatory modifications, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and different elements, lots of that are beyond the control of the Firm. Though any forward wanting statements contained in this announcement are based mostly upon what the Directors consider to be affordable assumptions, the Company can’t assure buyers that precise outcomes will probably be in keeping with such ahead wanting statements.