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Alphamin announces Q2 2021 ebitda guidance of US$34m and production, sales and growth projects update
Alphamin Resources Corp.
Continued in the Republic of Mauritius
Date of incorporation: 12 August 1981
Corporation number: C125884 C1/GBL
TSX-V share code: AFM
JSE share code: APH
ISIN: MU0456S00006
ALPHAMIN ANNOUNCES Q2 2021 EBITDA GUIDANCE OF US$34m AND
PRODUCTION, SALES AND GROWTH PROJECTS UPDATE
MAURITIUS – July 6, 2021 – Alphamin Resources Corp. (AFM:TSXV, APH:JSE AltX,
“Alphamin” or the “Company”), a producer of 4% of the world’s mined tin1 from its high grade
operation in the Democratic Republic of Congo, is pleased to provide the following operational
and growth update for the quarter ended June 2021:
- Q2 EBITDA guidance of $34m, at a tin price of $28,326/t versus current of $31,800/t
- Net Debt reduced to $29,9m
- Contained tin production of 2,412 tons (11% below prior guidance and 8% below the
prior quarter)
- Fine tin recovery plant fully commissioned and producing from 26 June 2021
- Mpama South phase 3 drilling progressing to plan with strong visual mineralisation
from initial step-out holes
- Mpama North Deeps drilling commenced 2 July 2021 with additional rigs under
mobilisation to accelerate drilling campaign
Operational and Financial Summary for the Quarter ended June 20212
Description Units Actual
Quarter Quarter
ended June ended March Variance
2021 2021
Tons Processed Tons 105 294 93 997 12%
Tin Grade Processed % Sn 3,2 3,8 -16%
Overall Plant Recovery % 72 74 -3%
Contained Tin Produced Tons 2 412 2 611 -8%
Contained Tin Sold Tons 2 404 3 351 -28%
EBITDA (Q2 2021 guidance) US$'000 34 000 36 453 -7%
Tin Price Achieved US$/t 28 326 23 083 23%
__________________________________________________________________________________________
1
Data obtained from International Tin Association Tin Industry Review 2020
2 Production information is disclosed on a 100% basis. Alphamin indirectly owns 84.14% of its operating subsidiary to which the information relates.
3 Q2 2021 EBITDA represents management’s guidance.
Operational and Financial Performance
Contained tin production of 2,412 tons was 11% below guidance (2,700 tons), impacted by a
low feed grade of 3.2% Sn compared to 3.8% Sn the previous quarter. The month of June
2021 saw lower than expected grades from underground. The variable nature of tin
mineralisation in the orebody may cause large fluctuations in delivered grade – as a mitigating
tool we will increase planned waste development for the remainder of the year in order to
provide more mining flexibility for blending high- and low-grade areas.
Taking into consideration the lower feed grade, the processing plant performed well, treating
12% more material and achieving recoveries of 72%.
Our EBITDA guidance of $34m for Q2 2021 is 7% below Q1 2021 – the previous quarter
benefitted from a significant catch-up in tin sales following logistical bottlenecks during Q4
2020. Tin prices are currently trading at around $31,800/t, 12% above prices achieved during
the past quarter.
Net debt amounted to $29,9m at 30 June 2021, down 50% from the start of the financial year
(31 December 2020: $59,9m).
The Company has appointed Mr. Jan Trouw as the on-mine Managing Director of its 84,14%
subsidiary, Alphamin Bisie Mining, effective 1 July 2021. Mr Trouw is well known to the
Alphamin team and has over 40 years of African mining experience – recently as head of the
Frontier copper mine in the DRC and prior to that as General Manager of the high-grade
Chibuluma copper mine in Zambia. He was instrumental during late 2019 in developing the
new mining method and mine design criteria for Alphamin’s Bisie tin mine. We look forward to
working with Mr Trouw in realising our vision of becoming one of the world’s largest long-life
tin producers.
Alphamin’s unaudited consolidated financial statements and accompanying Management’s
Discussion and Analysis for the quarter ended 30 June 2021 is expected to be released on or
around 9 August 2021.
Growth Initiatives
Fine Tin Recovery Plant (FTP) - The FTP is fully commissioned and produced at steady state
from 26 June 2021. Expenditure at completion is substantially in line with the budget of US$4.6
million. Production from the FTP during its first week of operations increased overall contained
tin production by 5%. This exceeded expectations so early after commissioning. The
exceptionally high grade of the FTP concentrates provides further scope to reduce product
grade in pursuit of higher tin recoveries.
Exploration Activities - Alphamin’s exploration initiative aims to: extend the life-of-mine at its
currently producing Mpama North operation; to declare a Maiden Mineral Resource for Mpama
South (located 750 metres south of Mpama North); and to discover at least one additional
orebody on the highly prospective Bisie Ridge (13km strike length).
Drilling at the Mpama North orebody commenced on 2 July 2021. An initial 15,000 metre (22
holes) drilling campaign over 4 months is planned to test the strike and dip extension of the
current producing orebody, below 400m in depth from the mine portal.
The Mpama South phases 1 and 2 drilling of 10,015 metres (46 holes) have been completed
with external assays for 29 holes announced to date. The remaining external lab assays are
expected in two batches during July and early August 2021. Phase 3 drilling of 6,800 metres
is progressing to plan - to date, 5 of the 24 holes have been completed showing strong visual
mineralisation over wide intercepts within the interpreted high-grade shoot.
In addition to Mpama North and Mpama South, drilling on the highly prospective Bisie ridge
(13km strike length), which falls within the Company’s mining licence, is expected to
commence in August 2021. Access roads have been established and initial drill targets are
being developed in consultation with the Company’s appointed structural specialists, TECT
Geological Consulting.
Qualified Person
Mr Vaughn Duke Pr.Eng. PMP, MBA, B.Sc. Mining Engineering (Hons.), is a qualified person
(QP) as defined in National Instrument 43-101 and has reviewed and approved the scientific
and technical information contained in this news release. He is a Principal Consultant, Partner
and Director of Sound Mining Solutions, an independent technical consultant to the Company.
__________________________________________________________________________________________
FOR MORE INFORMATION, PLEASE CONTACT:
Maritz Smith
CEO
Alphamin Resources Corp.
Tel: +230 269 4166
E-mail: msmith@alphaminresources.com
JSE Sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Information in this news release that is not a statement of historical fact constitutes forward-
looking information. Forward-looking statements contained herein include, without limitation,
statements relating to expected future EBITDA for Q2 2021, the impact of the Company’s fine
tin recovery plant on production and the timing and success of additional exploration drilling
outcomes. Forward-looking statements are based on assumptions management believes to
be reasonable at the time such statements are made. There can be no assurance that such
statements will prove to be accurate, as actual results and future events could differ materially
from those anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. Although Alphamin has attempted to identify important
factors that could cause actual results to differ materially from those contained in forward-
looking statements, there may be other factors that cause results not to be as anticipated,
estimated or intended. Factors that may cause actual results to differ materially from expected
results described in forward-looking statements include, but are not limited to: uncertainties
associated with Alphamin’s resource and reserve estimates, uncertainties regarding estimates
of the expected mined tin grades, processing plant performance and recoveries, uncertainties
regarding global supply and demand for tin and market and sales prices, uncertainties with
respect to social, community and environmental impacts, uninterupted access to required
infrastructure, adverse political events, impacts of the global Covid-19 pandemic on mining
operations and commodity prices as well as those risk factors set out in the Company’s
Management Discussion and Analysis and other disclosure documents available under the
Company’s profile at www.sedar.com. Forward-looking statements contained herein are made
as of the date of this news release and Alphamin disclaims any obligation to update any
forward-looking statements, whether as a result of new information, future events or results or
otherwise, except as required by applicable securities laws.
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined
in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
USE OF NON-IFRS FINANCIAL PERFORMANCE MEASURES
This announcement refers to the following non-IFRS financial performance measure:
EBITDA
EBITDA is profit before net finance expense, income taxes and depreciation, depletion, and
amortization. EBITDA provides insight into our overall business performance (a combination
of cost management and growth) and is the corresponding flow driver towards the objective of
achieving industry-leading returns. This measure assists readers in understanding the ongoing
cash generating potential of the business including liquidity to fund working capital, servicing
debt, and funding capital expenditures and investment opportunities.
This measure is not recognized under IFRS as it does not have any standardized meaning
prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented
by other issuers. EBITDA data is intended to provide additional information and should not be
considered in isolation or as a substitute for measures of performance prepared in accordance
with IFRS.
Date: 06-07-2021 03:44:00
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