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Half-Year Results For Period Ending 31 December 2021
MC Mining Limited
Previously Coal of Africa Limited
(Incorporated and registered in Australia)
Registration number ABN 008 905 388
ISIN AU000000MCM9
JSE share code: MCZ
ASX/AIM code: MCM
ANNOUNCEMENT 14 March 2022
Half-Year Results For Period Ending 31 December 2021
MC Mining Limited (MC Mining or the Company) is pleased to provide
its interim financial report for the six months ended 31 December 2021
(the Period). All figures are denominated in United States dollars
unless otherwise stated and the full report is available on the
Company's website, www.mcmining.co.za.
Financial review
- The loss after tax for the Period was $0.8 million or 0.54 cents
per share (FY2021 H1: loss after tax of $2.7 million or 1.80 cents
per share);
- Revenue of $13.0 million (FY2021 H1: $8.8 million) and cost of
sales of $10.9 million (FY2021 H1: $9.2 million) resulted in a
gross profit of $2.1 million (FY2021 H1: gross loss $0.4 million)
for the Period;
- Employee benefit expense of $1.2 million (FY2021 H1: $1.0 million);
- Other expenses of $1.7 million (FY2021 H1: $1.3 million); and
- As at 31 December 2021, the Company had cash and cash equivalents
of $1.9 million compared to cash and cash equivalents of $1.0
million at 30 June 2021.
Operational review
FY2022 H1 FY2021 H1 % change
Production tonnages
Uitkomst ROM coal (t) 227,448 246,229 (8%)
Sales tonnages
Own ROM coal (t) 107,953 127,534 (15%)
Middlings sales (t) 11,655 11,569 1%
119,608 139,103 (14%)
Financial metrics
Revenue/t ($) 109 62 76%
Production costs/saleable tonnes
85 54 57%
($)
- The Uitkomst metallurgical and thermal coal mine (Uitkomst Colliery
or Uitkomst) sold 107,953 tonnes (t) of high quality metallurgical
and thermal coal during the Period (FY2021 H1: 127,534t);
- An additional 11,655t of high-ash middlings were sold during the
Period (FY2021 H1 11,569t);
- The higher global demand for coal post the COVID-19 pandemic
resulted in a significant increase in international prices with an
average API4 coal price of $151/t for the Period (H1 FY2021: $64/t);
- The Company continues to progress a number of debt/equity funding
initiatives to raise the additional funding required to develop the
Makhado hard coking coal project (Makhado Project or Makhado);
- Limited activities at MC Mining’s other projects, being the Vele
semi-soft coking and thermal coal colliery and Greater Soutpansberg
Projects (collectively, the Limpopo Projects), which remain in
various stages of development;
- An improved safety record with three lost-time injuries (LTIs)
reported at Uitkomst during the Period (FY2021 H1: four LTIs). No
LTIs were reported at the Makhado or Limpopo Projects; and
- The Company recorded 17 positive COVID-19 cases (FY2021 H1: 27
positive COVID-19 cases) at Uitkomst, Makhado and Limpopo Projects
during the Period.
Corporate features
- The Industrial Development Corporation of South Africa Limited
(IDC) has provided longstanding commitment to the development of
Makhado and has provided a loan of $10.0 million (ZAR160 million)
(excluding interest). This funded the progress of the project to
its fully-permitted status as well as to partially fund the
acquisition of the surface rights over the project area. During the
Period, the IDC extended the date for repayment to 31 January 2022
and subsequent to the end of the Period, this was further extended
to 30 November 2022.
- During July 2019 the IDC granted MC Mining a conditional $15.4
million (ZAR245 million) term loan facility for the development of
the Makhado Project. During the Period the terminal draw down date
for this facility was extended from 31 July 2021 to 31 January
2022. The IDC subsequently further extended the terminal draw down
date to 30 November 2022, subject to the bank confirming its due
diligence.
Further subsequent events
- Completion of the acquisition of the Lukin and Salaita properties,
being the key surface rights for the Makhado Project, with the
settlement of the deferred balance of $2.6 million (ZAR40.6
million) at the end of February 2022.
- Staged $5.7 million (ZAR86 million) Convertible Advance and
Subscription Agreement (the Agreement) with South African-based
mining group, Senosi Group Investment Holdings Proprietary Limited
(SGIH). SGIH has a successful track record of developing and
operating coal mines in South Africa and the transaction is of
great significance as the Company moves closer to finalising a
funding package to develop the Makhado Project. At the date of the
interim financial report, SGIH had paid $2.7 million (ZAR40
million) in terms of the Agreement.
- MC Mining received a notice under section 249D of the Corporations
Act 2001 (Cth) from shareholders holding approximately 6.8% of its
ordinary shares between them, requesting that a general meeting be
held. An extraordinary general meeting (EGM) of the Company has
been convened for 11 April 2022 to consider the relevant
resolutions.
- Mr Bernard Pryor resigned as Chairman of the Board and long standing
Non-Executive director Mr Khomotso Mosehla was appointed as
Chairman, pending the outcome of the scheduled 11 April 2022 EGM.
Authorised by
Sam Randazzo
CEO/Director
This announcement has been approved by the Company’s Disclosure Committee.
This announcement is inside information for the purposes of Article 7 of
Regulation 596/2014.
For more information contact:
Sam Randazzo Interim CEO MC Mining Limited +61 408 945010
Tony Bevan Company Secretary Endeavour Corporate +61 08 9316 9100
Services
Company advisors:
James Harris / James Dance Nominated Adviser Strand Hanson Limited +44 20 7409 3494
Rory Scott Broker (AIM) Tennyson Securities Limited +44 20 7186 9031
James Duncan Financial PR (South Africa) R&A Strategic +27 11 880 3924
Communications
Investec Bank Limited is the nominated JSE Sponsor
About MC Mining Limited:
MC Mining is an AIM/ASX/JSE-listed coal exploration, development and mining company operating in South Africa. MC
Mining’s key projects include the Uitkomst Colliery (metallurgical and thermal coal), Makhado Project (hard coking coal).
Vele Colliery (semi-soft coking and thermal coal), and the Greater Soutpansberg Projects (coking and thermal coal).
Forward-looking statements
This Announcement, including information included or incorporated by reference in
this Announcement, may contain "forward-looking statements" concerning MC Mining that
are subject to risks and uncertainties. Generally, the words "will", "may", "should",
"continue", "believes", "expects", "intends", "anticipates" or similar expressions
identify forward-looking statements. These forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially from those
expressed in the forward-looking statements. Many of these risks and uncertainties
relate to factors that are beyond MC Mining’s ability to control or estimate
precisely, such as future market conditions, changes in regulatory environment and
the behaviour of other market participants. MC Mining cannot give any assurance that
such forward-looking statements will prove to have been correct. The reader is
cautioned not to place undue reliance on these forward-looking statements. MC Mining
assumes no obligation and does not undertake any obligation to update or revise
publicly any of the forward-looking statements set out herein, whether as a result
of new information, future events or otherwise, except to the extent legally required.
Statements of intention
Statements of intention are statements of current intentions only, which may change
as new information becomes available or circumstances change.
Date: 14-03-2022 09:00:00
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