TIDMCEY
RNS Number : 9436W
Centamin PLC
03 May 2016
For immediate release 3 May 2016
Centamin plc ("Centamin" or the "Company")
(LSE:CEY, TSX:CEE)
Centamin plc Results for the Quarter ended 31 March 2016
Centamin plc ("Centamin" or the "Company") (LSE: CEY, TSX: CEE)
is pleased to announce its unaudited results for the three months
ended 31 March 2016.
Operational Highlights
-- Gold production of 125,268 ounces was a 6% increase on Q4 2015 and 16% higher than Q1 2015.
-- Cash cost of production of US$603 per ounce and all-in
sustaining costs (AISC) of US$758 per ounce.
-- Unchanged 2016 annual guidance of 470,000 ounces at US$680
per ounce cash cost of production and US$900 per ounce AISC.
-- Process plant throughput of 2.88Mt was 5% above the base case
target rate of 11Mtpa, with scope over the coming quarters for
further throughput increases through ongoing optimisation.
-- Open pit mining total material movement of 15.2Mt was a
quarterly record with the full annualised rate of 66Mt reached, as
scheduled, for the expanded operation in March.
-- Underground mining rates and average grades were above the
forecast average for the full year.
-- Continued positive results from underground exploration
drilling at Sukari supports the potential for further resource and
reserve expansion.
-- Exploration continues to support the potential for
near-surface and high-grade economic mineralisation in Burkina
Faso. Encouraging results from initial drilling programmes in Côte
d'Ivoire.
Financial Highlights
-- EBITDA of US$67.5 million was up 42% on Q4 2015 and up 27% on Q1 2015.
-- Basic earnings per share 3.56 US cents, up 3.75 US cents on
Q4 2015 and up 1.06 US cents on Q1 2015.
-- Centamin remains debt-free and un-hedged with cash, bullion
on hand, gold sales receivable and available-for-sale financial
assets of US$275.7 million at 31 March 2016, up 19.5% on Q4
2015.
Legal Developments in Egypt
-- The Supreme Administrative Court appeal and Diesel Fuel Oil
court case are both still on-going. With the potential for the
legal process in Egypt to be lengthy, Centamin anticipates a number
of hearings and adjournments before decisions are reached. Any
enforcement of the Administrative Court decision has been suspended
pending the appeal ruling.
Q1 2016 Q4 2015 Q1 2015
-------------------------------- ----------- -------- -------- --------
Gold produced ounces 125,268 117,644 108,233
Gold sold ounces 123,668 117,351 111,249
Cash cost of production US$/ounce 603 667 717
AISC US$/ounce 758 851 858
Average realised gold
price US$/ounce 1,196 1,103 1,216
-------------------------------- ----------- -------- -------- --------
Revenue US$'000 148,107 130,196 135,479
EBITDA US$'000 67,484 47,547 52,988
Profit/(loss) after tax US$'000 40,850 (2,081) 28,566
Basic EPS US cents 3.56 (0.19) 2.50
Cash generated from operations US$'000 60,482 53,410 56,643
-------------------------------- ----------- -------- -------- --------
Notes to highlights
- Cash cost of production, AISC, EBITDA and cash, bullion on
hand, gold sales receivables and available-for-sale financial
assets are non-GAAP measures and are defined at the end of the
Financial Statements. AISC is defined by the World Gold Council,
the details of which can be found at www.gold.org.
- Basic EPS, EBITDA, AISC, cash cost of production includes an
exceptional provision against prepayments, recorded since Q4 2012,
to reflect the removal of fuel subsidies which occurred in January
2012 (see Notes 4 and 5 of the Financial Statements)
Andrew Pardey, CEO of Centamin, commented: "The first quarter
marked a solid start to the year, with a 42% quarterly increase in
EBITDA to US$67.5 million driven by production at Sukari of 125,268
ounces of gold and a continued downward trend in costs. Cash cost
of production of US$603 per ounce and AISC of US$758 per ounce were
a material reduction on the previous quarter and below our full
year guidance. Operationally, processing was a highlight and a key
driver of the increase in gold output, with plant throughput rising
above our base forecast rate of 11Mt per annum as the optimisation
programme continued. With quarterly production rates expected to
remain within the 450,000 to 500,000 ounces per annum range, our
full year guidance remains unchanged at 470,000 ounces at US$680
per ounce cash cost of production and US$900 per ounce AISC. The
key focus for the operation during the coming quarters is on
realising the potential for sustained productivity and cost
improvements."
Centamin will host a conference call on Tuesday, 3rd May 2016 at
9.00am (London, UK time) to update investors and analysts on its
results. Participants may join the call by dialling one of the
following three numbers, approximately 10 minutes before the start
of the call.
UK Toll Free: 0808 237 0040
International Toll number: +44 203 428 1542
Canada Toll free: 1866 404 5783
Participant code: 84900650#
A recording of the call will be available four hours after the
completion of the call on:
UK Toll Free: 0808 237 0026
International Toll number: +44 20 3426 2807
Playback Code: 671356#
Via audio link at http://www.centamin.com/centamin/investors
________________________________
CHIEF EXECUTIVE OFFICER'S REPORT
First quarter gold production of 125,268 ounces represented a 6%
increase on the previous quarter. A comparable increase in gold
sales, together with an 8% rise in the average realised gold price
and a 10% reduction in the cash cost of production to US$603 per
ounce, saw EBITDA increase by 42% on the previous quarter to
US$67.5 million.
The quarterly reduction in unit cash cost of production was
primarily a function of both the higher gold production and also an
8% decrease in mine production costs to US$71.6 million. The lower
operating expenditure was achieved despite higher processing and
open pit mining rates, and reflects improved cost efficiencies in
addition to a continued reduction in fuel prices.
Sukari's strong free cash flows and competitive returns were
also highlighted by first quarter AISC of US$758 per ounce, below
our full year guidance of US$900 per ounce. In addition to the
factors affecting the cash cost of production, there was a lower
quarterly expenditure on sustaining capital than is expected for
the remainder of the year.
Centamin's balance sheet continued to build strength, ending the
period with US$275.7 million of cash, bullion on hand, gold sales
receivable and available-for-sale financial assets. This marked an
increase of US$45 million during the quarter, and followed
expenditure on exploration (excluding Sukari underground drilling)
of US$12.0 million, supported by continued positive drill results
from West Africa. Centamin remains committed to its policy of being
100% exposed to the gold price through its un-hedged position.
Safety remains a priority and therefore it is pleasing to note
that during the period we reached our safety target of zero lost
time injuries.
Processing rates were 4% higher than the prior quarter and 5%
above our base case 11Mtpa forecast rate as optimisation continued.
Recoveries of 88.6% were in line with both the previous quarter and
our forecast for the full year. Work continues on developing the
potential to improve and sustain recoveries at the 90% level at
increasing throughput rates.
The open pit delivered total material movement of 15,157kt, an
increase of 10% on Q4 2015 due to improved fleet utilisation and
productivity. During March, mining reached the full annualised rate
of 66 million tonnes as scheduled for the expanded operation and
higher quarterly mining rates are expected in the second quarter.
Mined ore grades of 0.87g/t were below expected levels for the full
year as production focussed on lower grade sections of the ore
body. Pit development has progressed according to the current mine
plan and grades mined and milled increased towards the reserve
average by the end of the quarter, as expected.
The underground mine delivered 281kt of ore, a 6% decrease on Q4
2015, at an average grade of 7.77g/t (compared with 7.05g/t in Q4
2015). The focus for the operation remains to consistently deliver
ore at an average grade of at least 6g/t.
Production is forecast to remain in the 450,000 to 500,000
ounces per annum range and we maintain our full year guidance of
470,000 ounces at US$680 per ounce cash cost of production and
US$900 per ounce AISC. With gold output now established at target
levels for the expanded Sukari operation, we remain focussed on
realising further increases in productivity and cost efficiencies.
Whilst our forecasts remain unchanged, we continue to note that
optimisation of the mining and processing operations is ongoing and
offers the potential in the coming quarters to deliver increased
gold output and lower costs than this base case outlook.
Our exploration in Burkina Faso continues to build evidence of a
number of potentially economic high-grade mineralised structures,
in addition to extensive areas of lower-grade mineralisation. We
continue to test the potential for lateral and depth extensions at
these more advanced targets, with priority on the Wadaradoo and
Napalapera prospect areas. In Côte d'Ivoire, first-pass drilling
over targets defined by geochemical and geophysical surveys has
indicated the potential over a number of prospects for laterally
significant mineralisation.
(MORE TO FOLLOW) Dow Jones Newswires
May 03, 2016 02:01 ET (06:01 GMT)
Developments in the two litigation actions, Diesel Fuel Oil and
Concession Agreement, are described in further detail in Note 7 to
the financial statements. No final decision has been taken by the
courts regarding the Diesel Fuel Oil case and the Company is aware
of the potential for delays in the Egyptian legal system. In
respect of the Concession Agreement case, the Company continues to
believe that it has a strong legal position and, in addition, that
it will ultimately benefit from law no 32 of 2014, which came into
force in April 2014 and which restricts the capacity for third
parties to challenge any contractual agreement between the Egyptian
government and an investor. This law, whilst in force and ratified
by the new parliament, is currently under review by the Supreme
Constitutional Court of Egypt. After a series of delays and
adjournments, the Concession Agreement appeal has now been set down
for judgment on 24 May 2016. If the judgment is a final judgment,
the Company expects it will be in its favour. However, it has been
advised that the Egyptian legal system allows for the possibility
of an interim judgment staying the appeal until the Supreme
Constitutional Court has ruled on the validity of law no 32.
OPERATIONAL REVIEW
Sukari Gold Mine
Q1 2016 Q4 2015 Q1 2015
---------------------------------- ------- -------- -------
OPEN PIT MINING
Ore mined (1) ('000t) 2,405 2,229 2,562
Ore grade mined (Au g/t) 0.87 0.77 0.78
Ore grade milled (Au g/t) 0.83 0.75 0.95
Total material mined ('000t) 15,157 13,754 15,996
Strip ratio (waste/ore) 5.30 5.17 5.24
---------------------------------- ------- -------- -------
UNDERGROUND MINING
Ore mined from development
('000t) 145 151 129
Ore mined from stopes ('000t) 136 149 135
Ore grade mined (Au g/t) 7.77 7.05 6.01
---------------------------------- ------- -------- -------
Ore processed ('000t) 2,876 2,758 2,478
Head grade (g/t) 1.49 1.47 1.48
Gold recovery (%) 88.5 88.5 88.3
Gold produced - dump leach
(oz) 2,993 3,417 4,814
Gold produced - total (2)
(oz) 125,268 117,644 108,233
Cash cost of production(3)
(4) (US$/oz) 603 667 717
Open pit mining 213 232 247
Underground mining 44 42 47
Processing 307 338 369
G&A 39 54 54
AISC(3) (4) (US$/oz) 758 851 N 858
---------------------------------- ------- -------- -------
Gold sold (oz) 123,668 117,351 111,249
Average realised sales
price (US$/oz) 1,196 1,103 1,216
---------------------------------- ------- -------- -------
(1) Ore mined includes 0t delivered to the dump leach in Q1 2016 (217kt @ 0.52 g/t in Q1 2015).
(2) Gold produced is gold poured and does not include gold-in-circuit at period end.
(3) Cash cost of production exclude royalties, exploration and
corporate administration expenditure. Cash cost of production and
AISC are non-GAAP financial performance measures with no standard
meaning under GAAP. For further information and a detailed
reconciliation, please see "Non-GAAP Financial Measures" section
below.
(4) Cash cost of production and AISC include an exceptional
provision against prepayments to reflect the removal of fuel
subsidies which occurred in January 2012 (see notes 4 and 5 to the
financial statements).
Health and safety - Sukari
The lost time injury (LTI) frequency rate for Q1 2016 was zero
per 200,000 man-hours (Q1 2015: 0.33 per 200,000 man-hours), with a
total of 1,290,943 man-hours worked (Q1 2015: 1,228,658). This is
in line with our target of zero injuries and every employee
returning safely every day. Centamin views its low LTI frequency
rate as a solid achievement particularly as Sukari is the first
modern gold mine in Egypt.
Open pit
The open pit delivered total material movement of 15,157kt, an
increase of 10% on Q4 2015 due to improved fleet utilisation,
although this was a 5% decrease on the prior year period. Mining
continued to focus on the Stage 3A and 3B areas and the eastern
walls of the open pit, in line with the mine plan.
Open pit ore production was 2,405kt, up 8% on the previous
quarter, at 0.87g/t. The average head grade to the plant of 0.83g/t
was below our original forecast and below the reserve average grade
due to some rescheduling of lower grade material. Grades mined and
milled increased by the end of the quarter, as expected. The ROM
ore stockpile balance decreased by 211kt to 490kt by the end of the
quarter.
Further improvements in fleet utilisation and productivity are
expected to deliver continued increases in mining rates during the
second quarter. Continued pit development allows for mined grades
to increase towards the reserve average of 1.03g/t during the
second quarter, in line with the mine plan.
Underground mine
The underground operation delivered 281kt of ore, a 6% decrease
on Q4 2015 and a 6% increase on the corresponding prior year
period. The ratio of stoping to development ore mined was
unchanged, with 51% of ore from stoping (145kt, down 4% on Q4 2015)
and 49% from development (136kt, down 9% on Q4 2015).
The average mined grade of 7.77g/t was above our forecast
average grade for 2016 of 6.0g/t, and comprised ore from stoping at
9.15g/t and ore from development at 6.31g/t.
Development, including the Amun and Ptah decline, advanced a
total of 2,114 metres during the quarter. The Horus Decline, to
connect Amun and Ptah, commenced this quarter. Development within
mineralised areas of Amun accounted for 1,181 metres and took place
between the 815 and 680 levels (245 to 380 metres below the
underground portal), including the advance of the Amun decline
through areas of low-grade ore. Ptah development in mineralised
areas took place over 428 metres between the P810 and P735 levels
(250 and 325 metres below the underground portal).
A total of 2,642 metres of grade control diamond drilling were
completed, aimed at short-term stope definition, drive direction
optimisation and underground resource development. A further 5,753
metres of drilling continued to test the depth extensions below the
current Amun and Ptah zones.
Processing
Quarterly throughput at the Sukari process plant was 2,876kt, a
4% increase on the prior quarter, with throughput above our base
case target rate of 11Mtpa. Throughput increases were achieved as a
result of improved operational control and monitoring, a reduction
in unplanned breakdowns and ongoing plant modifications leading to
increased productivity. Plant productivity of 1,421 tonnes per hour
(tph) represented a 6% increase on the prior quarter.
Metallurgical recoveries were 88.6%, in-line with 88.5% in the
previous quarter. Work continues on developing the potential to
improve and sustain recoveries at the 90% level at the increasing
throughput rates.
The dump leach operation produced 2,993oz, a 12% decrease from
the previous quarter.
Exploration
Sukari
Drilling from underground remains a focus of the Sukari
exploration programme as new development provides improved access
to test potential high-grade extensions of the deposit. These ore
body extensions have not yet been closed off and further
underground drilling will take place during 2016, predominantly
from both the Amun and Ptah declines.
Selected results received during the first quarter from the
underground drilling programme, which are in addition to results
disclosed previously, include the following:
Amun and Ptah significant diamond drill intersections,
downhole.
(Note the underground portal is located at the 1060m RL
elevation).
Prospect HoleID From Width Grade
(m) (m) (g/t)
---------- -------------- ------ ------ -------
AMUN UGRSD0082 151.4 2.6 108.2
---------- -------------- ------ ------ -------
UGRSD0201 199.0 0.3 945.9
------------------------- ------ ------ -------
UGRSD0201 230.2 9.5 78.4
------------------------- ------ ------ -------
UGRSD0221 61.0 1.0 26.0
------------------------- ------ ------ -------
UGRSD0229 28.0 1.0 39.1
------------------------- ------ ------ -------
UGRSD0229 118.0 18.4 12.6
------------------------- ------ ------ -------
UGRSD0232 78.0 1.0 26.7
------------------------- ------ ------ -------
UGRSD0237 161.0 4.0 56.5
------------------------- ------ ------ -------
UGRSD0434 319.0 0.5 182.9
------------------------- ------ ------ -------
UGRSD0435 118.0 7.0 7.1
------------------------- ------ ------ -------
PTAH UGRSD0144 283.6 0.3 713.7
---------- -------------- ------ ------ -------
UGRSD0146 185.0 3.0 7.5
------------------------- ------ ------ -------
UGRSD0146 270.2 0.2 112.0
------------------------- ------ ------ -------
UGRSD0152 181.0 15.0 6.7
------------------------- ------ ------ -------
UGRSD0154 184.0 7.6 5.8
------------------------- ------ ------ -------
UGRSD0155 179.8 6.3 13.6
------------------------- ------ ------ -------
UGRSD0160 3.1 1.2 27.8
(MORE TO FOLLOW) Dow Jones Newswires
May 03, 2016 02:01 ET (06:01 GMT)
------------------------- ------ ------ -------
UGRSD0161 267.0 7.8 6.4
------------------------- ------ ------ -------
UGRSD0545 133.6 3.5 6.6
------------------------- ------ ------ -------
UGRSD0555 208.0 2.0 14.9
------------------------- ------ ------ -------
UGRSD0574_W2 512.0 7.0 6.4
------------------------- ------ ------ -------
UGRSD0575 520.7 3.3 11.6
------------------------- ------ ------ -------
UGRSD0585 4.0 1.0 21.8
------------------------- ------ ------ -------
UGRSD0585 25.3 2.3 110.7
------------------------- ------ ------ -------
UGRSD0702 282.6 0.5 172.0
------------------------- ------ ------ -------
Burkina Faso
The exploration strategy in Burkina Faso is to continue to
systematically explore and drill-test numerous targets along the
160km length of greenstone belt contained within the 2,200km(2)
licence holding. Results from this programme will lead to further
drilling and resource development during 2016. The main focus of
the exploration is to discover and develop new zones of near
surface high grade mineralisation.
During the quarter reverse circulation (RC) and diamond (DD)
drilling has occurred at a number of prospects, with a continued
focus on the Wadaradoo and Napelapera areas. The drilling fleet
comprised 5 multipurpose RC/DD rigs which completed 66,473m RC and
2,665m DD; aircore (AC) rigs which drilled 27,861m, and Auger rigs
which drilled 10,448m.
Exploration at Wadaradoo has focused on Wadaradoo Main,
Wadaradoo East and Wadaradoo Far Ear with four multipurpose rigs
based in the area for the quarter.
At Wadaradoo Main, a new zone of mineralisation, the northern
continuation of the 020(o) structure, was defined over a strike
length of 450m and remains open to the south and at depth. Results
include 6m @ 13.3g/t from 130m and 9m @ 3.0g/t from 81m. Other
results on the 020(o) structure to the south further confirm two
new high-grade plunging shoots which dip to the south, results
include 6m @ 11g/t from 216m and 4m @ 15.7g/t from 114m. Drilling
will continue to test down dip and along strike.
At Wadaradoo East, drilling continued to target the NW trending,
high grade lenses along strike. Assay results are pending. Regional
testing of numerous structures and targets around Wadaradoo
continued in various areas, including Wadaradoo Far East where
drilling is following on an intercept of 4m @ 6.3g/t from the first
pass RC drilling. Mapping and AC drilling continue to identify
structures and targets for follow-up RC drilling.
Wadaradoo significant RC and DD drill intersections,
downhole
HoleID From (m) Width Grade
(m) (g/t)
--------- --------- ------ -------
WDRC143 114 4 15.7
--------- --------- ------ -------
WDRC560 192 9 2.9
--------- --------- ------ -------
WDRC564 216 6 11.0
--------- --------- ------ -------
WDRC670 81 9 3.0
--------- --------- ------ -------
WDRC671 130 6 13.3
--------- --------- ------ -------
WDRC753 10 4 6.3
--------- --------- ------ -------
WDRC763 58 15 2.3
--------- --------- ------ -------
WDRC774 155 2 10.8
--------- --------- ------ -------
WDRC956 118 5 4.6
--------- --------- ------ -------
WDRD592 353 11 3.0
--------- --------- ------ -------
WDRD598 98 2 19.2
--------- --------- ------ -------
At Napelapera, the extension of the exploration permit to the
border with Cote d'Ivoire was granted in March, and a drill program
is planned to test the along-strike extension of mineralisation
into this new permit. Modelling and interpretation of the
high-grade mineralisation at Napelapera has highlighted three
shallow-plunging shoots, drilling of which has returned results
including 19m @ 3.9g/t and 4m @ 51.6g/t. The down-plunge
continuation of these shoots continues to be tested.
Napelapera significant RC and DD drill intersections,
downhole
HoleID From (m) Width Grade (g/t)
(m)
----------- --------- ------ ------------
NPRC468 38 10 1.8
----------- --------- ------ ------------
NPRD449 120 6 2.1
----------- --------- ------ ------------
NPRD451 172 9 1.6
----------- --------- ------ ------------
NPRD455W1 118 4 51.6
----------- --------- ------ ------------
NPRD457 127 3 5.6
----------- --------- ------ ------------
NPRD459 107 4 3.3
----------- --------- ------ ------------
Côte d'Ivoire
Centamin now has four permits in Côte d'Ivoire covering a
c.1,517km(2) area across the border from Batie West in Burkina
Faso. Seven permits remain under application and are expected to be
granted during 2016, following which exploration will focus on
regional surface geochemistry aimed at identifying anomalies for
first-pass drilling.
A total of 10,201m of RC was drilled over several prospects
during the quarter and a second RC rig is planned to start in the
second quarter. IP surveys, auger drilling, soil sampling,
trenching and structural mapping of artisanal workings continued
over the permits.
Drilling results from the Enoida prospect highlighted the
continuity of mineralisation of a similar tenor of grade as
Napelapera over a strike length 1.5km. Results include 17m @ 1.8g/t
and 9m @ 3.3g/t. Mineralisation remains open along strike and the
IP survey over the area indicates that the conductive/resistive
corridor extends a further 4.5km to the south. Further drilling is
planned to test this zone.
At Kekeda drilling has intersected several high-grade zones,
including 7m @ 5.7g/t and 7m @ 5.0g/t. Mineralisation is associated
with a shear zone which is related to a doleritic dyke. Gold is
hosted with sulphides often in quartz veining.
At Souwa, results from high-grade zones within shear hosted
mineralisation in granite included 4m @ 78.3g/t, 10m @ 22.0g/t and
33m @ 2.2g/t. The IP survey indicates extension to the NNE and
drilling continues to test the strike length of this potential
mineralised corridor.
Côte d'Ivoire significant AC drill intersections, downhole
Prospect HoleID From Width Grade
(m) (m) (g/t)
---------- ---------- ----- ------ -------
Enoida DPRC0107 30 9 3.1
---------- ---------- ----- ------ -------
DPRC0110 76 17 1.8
--------------------- ----- ------ -------
DPRC0112 49 6 2.9
--------------------- ----- ------ -------
DPRC0127 79 5 4.2
--------------------- ----- ------ -------
DPRC0129 24 9 3.3
--------------------- ----- ------ -------
Kekeda DPRC0018 36 7 5.7
---------- ---------- ----- ------ -------
DPRC0019 0 7 5.0
--------------------- ----- ------ -------
DPRC0019 25 4 8.2
--------------------- ----- ------ -------
DPRC0089 6 5 5.0
--------------------- ----- ------ -------
Souwa DPRC0039 44 10 22.0
---------- ---------- ----- ------ -------
DPRC0041 73 17 2.3
--------------------- ----- ------ -------
DPRC0042 21 33 2.2
--------------------- ----- ------ -------
DPRC0051 16 4 78.3
--------------------- ----- ------ -------
DPRC0061 11 20 3.0
--------------------- ----- ------ -------
DPRC0062 44 10 2.0
--------------------- ----- ------ -------
FINANCIAL REVIEW
In its seventh year of production, the Sukari Gold Mine remains
highly cash generative and this is reflected in the group's
financial results for the quarter ended 31 March 2016:
-- Q1 2016 revenues of US$148.1 million were up 9% compared with
Q1 2015 as a 2% fall in average realised gold prices was offset by
an 11% increase in gold sales.
-- Cash cost of production decreased to US$603 per ounce
produced from US$717 in Q1 2015. The main contributing factors were
the higher gold production, a drop in the international fuel price
and improved operational cost efficiencies.
-- AISC of US$758 per ounce sold was lower than the comparable
prior year period, mainly due to the factors described above and
the rescheduling of certain sustaining capital cost items. In Q1
2016 there was a lower quarterly expenditure on sustaining capital
than is expected for the remainder of the year.
-- EBITDA increased by 27% to US$67.5million compared to Q1
2015, due to 5% higher gross operating margins as a result of the
increased revenue and the lower cash cost of production.
-- Profit before tax of US$40.9 million was 43% higher than Q1
2015, mainly due to the 5% higher gross operating margins.
-- Earnings per share of 3.56 US cents, was 42% higher than Q1
2015, mainly due to the 5% higher gross operating margins.
-- Operational cash flow of US$60.5 million was 7% higher than
Q1 2015, due to the factors affecting EBITDA, offset by an increase
in working capital balances.
Revenue
Revenue from gold and silver sales for the quarter increased by
9% to US$148.1 million (US$135.5 million in Q1 2015), with a 2%
decrease in the average realised gold price to US$1,196 per ounce
(US$1,216 per ounce in Q1 2015) offset by an 11% increase in gold
sold to 123,668 ounces (111,249 ounces in Q1 2015).
Cost of sales
(MORE TO FOLLOW) Dow Jones Newswires
May 03, 2016 02:01 ET (06:01 GMT)
Cost of sales represents the cost of mining, processing,
refining, transport, site administration, depreciation,
amortisation and movement in production inventory. Cost of sales is
inclusive of exceptional items of US$6.4 million in relation to
fuel charges (refer to Note 4 and 5 to the financial statements for
further information) and has increased by 1% on the prior year
period to US$101.7 million, as a result of:
(a) an 8% decrease in total mine production costs to from
US$77.9 million to US$71.6 million, as a result of a 6% reduction
in mined tonnes offset by a 16% increase in processed tonnes;
(b) a 9% increase in depreciation and amortisation from US$24.5
million to US$26.7 million; and
(c) a US$5.3 million adjustment for movement in production
inventories as a result of an overall decrease in mining stockpiles
and gold in circuit levels offset by an increase in finished goods
inventory.
Centamin's cash cost of production was US$603 per ounce, a
decrease of US$64 per ounce from Q4 2015 as a result of an increase
in quarterly production, a drop in the international fuel price and
improved operational cost efficiencies. International fuel prices
continued to fall steadily during 2015 and into the first quarter
of 2016 with the cost per litre reducing by 36% from Q1 2015 to Q1
2016, or US$55 per ounce produced.
Other operating costs
Other operating costs comprises expenditure incurred for
communications, consultants, directors' fees, stock exchange
listing fees, share registry fees, employee entitlements, general
office administration expenses, the unwinding of the restoration
and rehabilitation provision, foreign exchange movements, the share
of profit/loss in associates and the 3% production royalty payable
to the Egyptian government. Other operating costs decreased by 14%
on the prior year period to US$5.7 million, as a result of:
(a) a US$1.2 million decrease in corporate costs; and
(b) a US$0.6 million increase in net foreign exchange movements
from a US$0.2 million gain to a US$0.8 million gain; offset by
(c) a US$0.4 million increase in royalty paid to the government
of the Arab Republic of Egypt in line with the increase in gold
sales revenue; and
(d) a US$0.4 million increase in impairment of available for sale financial assets charges.
Finance income
Finance income comprises interest revenue applicable on the
Company's available cash and term deposit amounts. The movements in
finance income are in line with the movements in the Company's
available cash and term deposit amounts.
Profit before tax
As a result of the factors outlined above, the group recorded a
profit before tax for the quarter ended 31 March 2016 of US$40.9
million (Q1 2015 US$28.6 million).
Earnings per share
Earnings per share of 3.56 US cents compares with 2.50 US cents
per share for Q1 2015. The increase was driven by the factors
outlined above.
Comprehensive income
Other comprehensive income was US$0.02 million and relates to
the revaluation of available-for-sale financial assets.
Financial position
Centamin has a strong and flexible financial position with no
debt, no hedging and cash, bullion on hand, gold sales receivables
and available-for-sale financial assets of US$275.7 million at 31
March 2016, up from US$230.7 million at 31 December 2015.
At 31 March As at 31 Dec At 31 March
2016 2015 2015
US$'000 US$'000 US$'000
Cash at bank 234,461 199,616 163,351
Bullion on hand 16,746 10,492 9,090
Gold sales receivable 24,252 20,472 22,896
Available for sale
financial assets 192 163 497
------------ ------------- ------------
275,651 230,743 195,834
------------ ------------- ------------
The majority of funds in US dollars have been invested in
international rolling short-term higher interest money market
deposits.
Current assets of US$389.9 million have increased by US$30.4
million or 8% compared with Q4 2015, as a result of:
(a) an increase in net cash inflows of US$34.8 million (net of foreign exchange movements);
(b) a US$5.7million decrease in stores inventory to US$100.8 million;
(c) a US$3.3 million decrease in overall mining stockpiles, gold
in circuit levels and finished goods inventory levels to US$24.9
million; and
(d) a US$3.6 million increase in gold sale receivables; offset by
(e) a US$0.9 million increase in prepayments.
Non-current assets of US$1,050.3 million have decreased by
US$2.0 million compared with Q4 2015, as a result of:
(a) US$26.7 million charge for depreciation and amortisation; offset by a
(b) US$11.7 million cost for net capitalised work-in-progress
(comprising of plant and mining equipment and rehabilitation
asset); and a
(c) US$13.0 million increase in capitalised exploration and
evaluation assets to US$165.1 million, as a result of the drilling
programmes in Sukari Hill, the Sukari tenement area, Burkina Faso
and Côte d'Ivoire.
Current liabilities of US$39.1 million decreased by US$12.3
million compared with Q4 2015, with a decrease of US$12.6 million
in payables and an increase of US$0.3 million in provisions. The
provision of US$6.8 million for Australian tax payable on forex
gains remains unchanged for the quarter.
Non-current liabilities of US$7.3 million increased by US$0.15
million compared with Q4 2015 as a result of an increase in the
rehabilitation provision.
Issued capital is unchanged from Q4 2015.
Share option reserves of US$2.2 million decreased by US$0.3
million compared with Q4 2015 as result of the forfeiture and
vesting of awards and the resultant transfer to accumulated profits
and issue capital respectively, offset by the recognition of the
share-based payments expense.
Accumulated profits increased by US$40.9 million as a result
of:
(a) US$40.9 million increase in the profit for the year
attributable to the shareholders of the Company; and a
(b) US$0.02 million gain on available-for-sale financial assets
in relation to the Company's shareholding in KEFI Minerals plc.
Cashflow
Net cash flows generated by operating activities comprise
receipts from gold and silver sales and interest income, offset by
operating and corporate administration costs. Net cash flows have
increased by US$3.7 million on the prior year period to US$60.4
million, primarily attributable to:
(a) an increase in revenue, due to higher gold sales offset by a
marginally lower average realised price; offset by a
(b) net increase in the cash outflows in relation to the working
capital balances of receivables, inventories, prepayments and
payables.
Net cash flows used in investing activities comprise exploration
expenditure and capital development expenditures at Sukari
including the acquisition of financial and mineral assets. Net cash
outflows have increased by US$7.4 million to US$24.7 million. The
primary use of the funds in the first quarter was for investment in
underground development and exploration expenditures incurred.
There were no net cash flows provided by financing activity
during the period.
Effects of exchange rate changes have decreased by US$0.9
million as a result of marginal strengthening of some of the
functional currencies used within the operation in the quarter.
Capital Expenditure
Q1 2016 Capital Expenditure
A breakdown of capital expenditure for the Group during Q1 2016
is as follows:
US$ million
Open pit development -
Underground mine development(1) 9.2
Other sustaining capital
expenditure 3.4
Total Sustaining Capex 12.6
Exploration 12.0
(1) Includes underground exploration drilling
NON-GAAP FINANCIAL MEASURES
Three non-GAAP financial measures are used in this report:
1) EBITDA: "EBITDA" is a non-GAAP financial measure, which
excludes the following from profit before tax:
-- Finance costs;
-- Finance income; and
-- Depreciation and amortisation.
Management believes that EBITDA is a valuable indicator of the
Group's ability to generate liquidity by producing operating cash
flow to fund working capital needs and fund capital expenditures.
EBITDA is also frequently used by investors and analysts for
valuation purposes whereby EBITDA is multiplied by a factor or
"EBITDA multiple" that is based on an observed or inferred
relationship between EBITDA and market values to determine the
approximate total enterprise value of a company. EBITDA is intended
to provide additional information to investors and analysts and
does not have any standardized definition under IFRS and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. EBITDA excludes the
impact of cash cost of production and income of financing
activities and taxes, and therefore is not necessarily indicative
of operating profit or cash flow from operations as determined
under IFRS. Other companies may calculate EBITDA differently. The
following table provides a reconciliation of EBITDA to profit for
the year attributable to the Company.
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Reconciliation of profit before tax to EBITDA:
Quarter ended Quarter ended Quarter ended Quarter ended
31 March 31 March 31 March 31 March
2016 2016 2015 2015
Before Exceptional Including Before Exceptional Including
items Exceptional items Exceptional
items(1) items(1)
US$'000 US$'000 US$'000 US$'000
Profit before
tax 47,305 40,864 42,513 28,566
Finance income (126) (126) (62) (62)
Depreciation
and amortisation 26,746 26,746 24,484 24,484
EBITDA 73,925 67,484 66,935 52,988
(1) Profit before tax, Depreciation and amortisation and EBITDA
includes an exceptional provision to reflect the removal of fuel
subsidies (refer to Note 4 of the Financial Statements for further
details).
Cash cost of production and all-in sustaining costs per ounce
calculation: Cash cost of production and AISC are non-GAAP
financial measures. Cash cost of production per ounce is a measure
of the average cost of producing an ounce of gold, calculated by
dividing the operating costs in a period by the total gold
production over the same period. Operating costs represent total
operating costs less administrative expenses, royalties,
depreciation and amortisation. Management uses this measure
internally to better assess performance trends for the Company as a
whole. The Company believes that, in addition to conventional
measures prepared in accordance with GAAP, certain investors use
such non-GAAP information to evaluate the Company's performance and
ability to generate cash flow. The Company believes that these
measures provide an alternative reflection of the Group's
performance for the current period and are an alternative
indication of its expected performance in future periods. Cash cost
of production is intended to provide additional information, does
not have any standardised meaning prescribed by GAAP and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. This measure is not
necessarily indicative of operating profit or cash flow from
operations as determined under GAAP. Other companies may calculate
these measures differently. During June 2013 the World Gold Council
(WGC), an industry body, published a Guidance Note on 'all-in
sustaining costs' metric, which gold mining companies can use to
supplement their overall non-GAAP disclosure. AISC is an extension
of the existing 'cash cost' metric and incorporates all costs
related to sustaining production and in particular recognising the
sustaining capital expenditure associated with developing and
maintaining gold mines. In addition, this metric includes the cost
associated with developing and maintaining gold mines. In addition,
this metric includes the cost associated with corporate office
structures that support these operations, the community and
rehabilitation costs attendant with responsible mining and any
exploration and evaluation costs associated with sustaining current
operations. AISC US$/oz is arrived at by dividing the dollar value
of the sum of these cost metrics, by the ounces of gold sold.
Reconciliation of cash cost of production per ounce:
Quarter ended Quarter ended Quarter ended Quarter ended
31 March 31 March 31 March 31 March
2016 2016 2015 2015
Before Exceptional Including Before Exceptional Including
items Exceptional items Exceptional
items(1) items(1)
US$'000 US$'000 US$'000 US$'000
Mine production costs
(Note 4) 65,709 71,641 64,585 77,874
Less: Refinery and
transport (384) (384) (324) (324)
Movement in inventory 2,660 4,297 - -
-------------------- -------------- -------------------- --------------
Cash cost of production 67,985 75,554 64,261 77,550
-------------------- -------------- -------------------- --------------
Gold Produced - Total 125,268 125,268 108,233 108,233
Cash cost of production US$543/oz US$603/oz US$594/oz US$717/oz
per ounce
Reconciliation of AISC per ounce:
Quarter ended Quarter Quarter ended Quarter ended
31 March ended 31 March 31 March
2016 31 March 2015 2015
Before Exceptional 2016 Before Exceptional Including
items Including items Exceptional
Exceptional items
items(1)
US$'000 US$'000 US$'000 US$'000
Mine production costs(2)
(Note 4) 65,709 71,641 64,585 77,874
Movement in inventory 2,832 3,340 - -
Royalties 4,432 4,432 4,055 4,055
Corporate administration
costs 1,800 1,800 3,099 3,099
Rehabilitation costs 145 145 90 90
Underground development 9,169 9,169 8,028 8,028
Other sustaining
capital exp. 3,442 3,442 9 9
By-product credit (255) (255) (247) (247)
-------------------- ------------- -------------------- --------------
AISC 87,274 93,714 79,619 92,908
-------------------- ------------- -------------------- --------------
Gold Produced - Total 123,668 123,668 108,233 108,233
AISC per ounce US$706/oz US$758/oz US$736/oz US$858/oz
(1) Mine production costs, Cash cost of production, AISC, Cash
cost of production per ounce, and AISC per ounce includes an
exceptional provision against prepayments recorded since Q4 2012 to
reflect the removal of fuel subsidies (refer to Note 4 of the
Financial Statements for further details).
(2) Includes Refinery and transport.
2) Cash and cash equivalents, Bullion on hand, Gold Sales
Receivables and Available-for-sale Financial Assets: This is a
non-GAAP financial measure any other companies may calculate these
measures differently.
Reconciliation to cash and cash equivalents, bullion on hand,
gold sales receivables and available-for-sale financial assets:
Quarter ended Quarter ended
31 March 31 March 2015
2016
US$'000 US$'000
Cash and cash equivalents (Note 16(a)) 234,461 163,351
Bullion on hand (valued at the year-end
spot price) 16,746 9,090
Gold sales receivable 24,252 22,896
Available-for-sale financial assets
(Note 13) 192 497
Cash, Bullion, Gold Sales Receivables
and Available-for-sale Financial
Assets 275,651 195,834
CORPORATE UPDATE
Final Dividend
As announced on 21 March 2016, the directors proposed a final
dividend of 1.97 US cents per share on Centamin plc ordinary shares
(totalling approximately US$22.7 million) for a 2016 full year
total of 2.94 US cents per share. The final dividend for 2015 will
be paid on 27 May 2016, subject to shareholder approval at the AGM
to be held in Jersey on 11 May 2016. The dividend will be paid to
shareholders on the register as at a Record Date of 22 April
2016.
Annual General Meeting
On 5 April 2016, Centamin published its Notice of Annual General
Meeting together with its 2015 Annual Report and Accounts.
Centamin's AGM will be held at 10:00 a.m. (UK time) on Wednesday 11
May 2016 at the Royal Yacht, Weighbridge, St Helier, Jersey,
Channel Islands, JE2 3NF.
Remuneration
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There have been no awards granted under the Company's share
plans to date in 2016, but awards are due to be granted under the
Company's share plans in June 2016. Awards made under the Company's
restricted share plan will apply the performance conditions
published in the notice of AGM and 2015 Annual Report and
Accounts.
LEGAL ACTIONS
As detailed in Note 7 of the accompanying interim condensed
consolidated financial statements, the Group is involved in legal
actions involving fuel supply and the Concession Agreement. As set
out in more detail in that Note, the Group's appeal against the 30
October 2012 ruling by the Egyptian Administrative Court remains
ongoing. Centamin does not currently see the need to take the
matter to proceedings outside of Egypt as Centamin remains of the
belief that the Egyptian Court will rule in Centamin's favour,
based on the legal merit of the case.
The Group continues to benefit from the full support of the
Ministry of Petroleum and EMRA, both in the appeal and at the
operational level. As part of its long term strategy, Centamin
looks forward to continuing to share the benefits of this
substantial investment.
It should be noted that the Company has been advised that it
should benefit from law no. 32 of 2014, which came into force in
April 2014 and which restricts the capacity for third parties to
challenge any contractual agreement between the Egyptian government
and an investor. This law, whilst in force and ratified by the new
parliament, is currently under review by the Supreme Constitutional
Court of Egypt. The Group therefore remains of the view that the
appeal is based on strong legal grounds and will ultimately be
successful. After a series of delays and adjournments, the
Concession Agreement appeal has now been set down for judgment on
24 May 2016. If the judgment is a final judgment, the Company
expects it will be in its favour. However, it has been advised that
the Egyptian legal system allows for the possibility of an interim
judgment staying the appeal until the Supreme Constitutional Court
has ruled on the validity of law no. 32.
With the exception of the relationships with EMRA and the
Egyptian government referred to above, we do not believe there are
any third party relationships which are critical to the Group's
success or which would have a material impact upon the Group's
position if the relationship broke down.
COST RECOVERY AND PROFIT SHARE
Based on the Company's calculation there was no 'Net Profit
Share' due to EMRA as at 31 March 2016, nor is any likely to be due
at 31 December 2016. It is expected that there will be profit share
due to EMRA for the Sukari Gold Mine financial year ending 30 June
2017, based on budgeted production, operating expense forecasts and
gold price. Centamin elected to make advance payments against
future profit share during 2013 to 2015 to the value of US$28.75
million, in order to demonstrate goodwill towards the Egyptian
government. These payments will be netted off against any future
Profit Share that becomes payable to EMRA.
Andrew Pardey
Chief Executive Officer
Set out below are the unaudited consolidated Financial
Statements for the Group, including notes thereto, for the quarter
ended 31 March 2016.
UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE QUARTER ENDED
31 MARCH 2016
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED 31 MARCH 2016
Note 31 March 2016 31 March 2015
-------------------------------------- --------------------------------------
Before Before
exceptional Exceptional exceptional Exceptional
items items Total items items Total
US$'000 (1) US$'000 US$'000 (1) US$'000
US$'000 US$'000
------------ ------------- --------- ------------ ------------- ---------
Revenue 3 148,107 - 148,107 135,479 - 135,479
Cost of sales 4 (95,259) (6,441) (101,700) (86,415) (13,947) (100,362)
------------ ------------- --------- ------------ ------------- ---------
Gross profit 52,848 (6,441) 46,407 49,064 (13,947) 35,117
Other operating
costs 4 (5,602) - (5,602) (6,940) - (6,940)
Reversal of Impairment
/ (Impairment)
of available-for-sale
financial assets 13 (67) - (67) 327 - 327
Finance income 3 126 - 126 62 - 62
Profit before
tax 47,305 (6,441) 40,864 42,513 (13,947) 28,566
Tax (14) - (14) - - -
Profit for the
period 47,291 (6,441) 40,850 42,513 (13,947) 28,566
------------ ------------- --------- ------------ ------------- ---------
Other comprehensive
income
Items that may
be reclassified
subsequently to
profit or loss:
Gains/(losses)
on available for
sale financial
assets (net of
tax) 21 - 21 136 - 136
Other comprehensive
income for the
period 13 21 - 21 136 - 136
------------ ------------- --------- ------------ ------------- ---------
Total comprehensive
income attributable
to:
Owners of the
Company 47,312 (6,441) 40,871 42,649 (13,947) 28,702
------------ ------------- --------- ------------ ------------- ---------
Earnings per share:
Basic (cents per
share) 10 4.126 (0.562) 3.564 3.722 (1.221) 2.501
Diluted (cents
per share) 10 4.067 (0.554) 3.513 3.690 (1.210) 2.480
(1() Refer to Note 4 for further details.
The above Unaudited Interim Condensed Consolidated Statement of
Comprehensive Income should be read in conjunction with the
accompanying notes.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
AS AT 31 MARCH 2016
Note 31 March 2016 31 December
2015
(Unaudited) (Audited)
US$'000 US$'000
NON-CURRENT ASSETS
Property, plant and equipment 11 856,412 871,467
Exploration and evaluation
asset 12 165,110 152,077
Prepayments 5 28,750 28,750
Other 63 60
------------- -----------
Total non-current assets 1,050,335 1,052,354
------------- -----------
CURRENT ASSETS
Inventories 125,766 134,775
Available-for-sale financial
assets 13 192 163
Trade and other receivables 27,407 23,784
Prepayments 5 2,067 1,161
Cash and cash equivalents 16(a) 234,461 199,616
------------- -----------
Total current assets 389,893 359,499
------------- -----------
Total assets 1,440,228 1,411,853
------------- -----------
NON-CURRENT LIABILITIES
Provisions 7,284 7,139
------------- -----------
Total non-current liabilities 7,284 7,139
------------- -----------
CURRENT LIABILITIES
Trade and other payables 31,393 43,969
Tax liabilities 6,828 6,837
Provisions 859 576
------------- -----------
Total current liabilities 39,080 51,382
------------- -----------
Total liabilities 46,364 58,521
------------- -----------
Net assets 1,393,864 1,353,332
------------- -----------
EQUITY
Issued capital 8 665,590 665,590
Share option reserve 2,130 2,469
Accumulated profits 726,144 685,273
------------- -----------
Total Equity 1,393,864 1,353,332
------------- -----------
The above Unaudited Interim Condensed Consolidated Statement of
Financial Position should be read in conjunction with the
accompanying notes.
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UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY FOR THE THREE MONTHS ENDED 31 MARCH 2016
Share option Accumulated
Issued Capital reserve profits Total Equity
US$'000 US$'000 US$'000 US$'000
-------------- ------------ ----------- --------------
Balance as at 1 January 2016 665,590 2,469 685,273 1,353,332
Profit for the period - - 40,850 40,850
Other comprehensive income
for the period - - 21 21
-------------- ------------ ----------- --------------
Total comprehensive income
for the period - - 40,871 40,871
Recognition of share based
payments - (339) - (339)
Balance as at 31 March 2016 665,590 2,130 726,144 1,393,864
-------------- ------------ ----------- --------------
Issued Share option Accumulated
Capital reserve profits Total Equity
US$'000 US$'000 US$'000 US$'000
-------------- ------------ ----------- --------------
Balance as at 1 January 2015 661,573 4,098 667,702 1,333,373
Profit for the period - - 28,566 28,566
Other comprehensive income
for the period - - 136 136
-------------- ------------ ----------- --------------
Total comprehensive income
for the period - - 28,702 28,702
Recognition of share based
payments - 715 - 715
Balance as at 31 March 2015 661,573 4,813 696,404 1,362,790
-------------- ------------ ----------- --------------
The above Unaudited Interim Condensed Consolidated Statement of
Changes in Equity should be read in conjunction with the
accompanying notes.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED 31 MARCH 2016
Three Months Ended
31 March
Note 2016 2015
US$'000 US$'000
Cash flows from operating activities
Cash generated in operating activities 16(b) 60,482 56,705
Finance income (126) (62)
Net cash generated by operating activities 60,356 56,643
--------- ---------
Cash flows from investing activities
Acquisition of property, plant and
equipment (11,691) (8,724)
Exploration and evaluation expenditure (13,100) (8,592)
Finance income 126 62
Net cash used in investing activities (24,665) (17,254)
--------- ---------
Net increase in cash and cash equivalents 35,691 39,389
Cash and cash equivalents at the beginning
of the period 199,616 125,659
Effect of foreign exchange rate changes (846) (1,697)
--------- ---------
Cash and cash equivalents at the end
of the period 16(a) 234,461 163,351
--------- ---------
The above Condensed Consolidated Statement of Cash Flows should
be read in conjunction with the accompanying note
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016
NOTE 1: ACCOUNTING POLICIES
Basis of preparation
These unaudited interim condensed consolidated financial
statements have been prepared in accordance with IAS 34 "Interim
Financial Reporting" ("IAS 34") and the requirements of the
Disclosure and Transparency Rules (DTR) of the Financial Conduct
Authority (FCA) in the United Kingdom as applicable to interim
financial reporting.
The unaudited interim condensed consolidated financial
statements represent a 'condensed set of financial statements' as
referred to in the DTRs. Accordingly, they do not include all of
the information required for a full annual financial report and are
to be read in conjunction with the Group's financial statements for
the year ended 31 December 2015, which were prepared in accordance
with International Financial Reporting Standards ("IFRS") as issued
by the International Accounting Standards Board ("IASB") and
adopted for use by the European Union and IFRS as issued by the
IASB. The financial information contained in this report does not
constitute statutory accounts under the Companies (Jersey) Law
1991, as amended. The financial information for the year ended 31
December 2015 is based on the statutory accounts for the year ended
31 December 2015. Readers are referred to the independent auditor's
report to the Group financial statements as at 31 December 2015
(available at www.centamin.com).
The accounting policies applied in these interim financial
statements are consistent with those used in the annual
consolidated financial statements for the year ended 31 December
2015. There have been no changes from the accounting policies
applied in the 31 December 2015 financial statements.
The preparation of these interim condensed consolidated
financial statements requires the use of certain significant
accounting estimates and judgment by management in applying the
Group's accounting policies. There have been no changes to the
areas involving significant judgment and estimates that have been
set out in Note 3 and 4 of the Group's annual audited consolidated
financial statements for the year ended 31 December 2015.
Going concern
These financial statements for the period ended 31 March 2016
have been prepared on a going concern basis, which contemplate the
realisation of assets and liquidation of liabilities during the
normal course of operations.
As discussed in Note 7, during 2012 the operation of the mine
was affected by two legal actions. The first of these followed from
a decision taken by EGPC to charge international, not local
(subsidised) prices for the supply of Diesel Fuel Oil, and the
second arose as a result of judgment of an Administrative Court of
first instance in relation to, amongst other matters, the Company's
160km(2) exploitation lease. In relation to the first decision, the
Company remains confident that, in the event that it is required to
continue to pay international prices, the mine at Sukari will
remain commercially viable. Similarly, the Company remains
confident that the appeal it has lodged in relation to the decision
of the Administrative Court will ultimately be successful, although
final resolution of it may take some time. On 20 March 2013 the
Supreme Administrative Court upheld the Company's application to
suspend the decision until the merits of the Company's appeal are
considered and ruled on, thus providing assurance that normal
operations would be able to continue during this process.
In the unlikely event that the Group is unsuccessful in either
or both of its legal actions, and that the operating activities are
restricted to a reduced area, it is the director's belief that the
Group will be able to continue as going concern.
The directors have a reasonable expectation that the Group will
have adequate resources to continue in operational existence for
the foreseeable future. Thus they continue to adopt the going
concern basis of accounting in preparing these interim condensed
consolidated financial statements.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 2: SEGMENT REPORTING
The Group is engaged in the business of exploration and mining
metals only, which represents a single operating segment. The Board
is the Group's chief operating decision maker within the meaning of
IFRS 8.
NOTE 3: REVENUE
An analysis of the Group's revenue for the period, from
continuing operations, is as follows:
Three Months Ended
31 March
2016 2015
US$'000 US$'000
Gold sales 147,852 135,231
Silver sales 255 248
----------- -----------
148,107 135,479
----------- -----------
NOTE 4: PROFIT BEFORE TAX
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Profit for the period has been arrived at after
crediting/(charging) the following gains/(losses) and expenses:
Three months ended 31 Three months ended 31
March 2016 March 2015
Before exceptional Before
items Exceptional Total exceptional Exceptional Total
items items items
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Finance income
Interest received 126 - 126 62 - 62
------------------ ------------- ------- ------------ ------------- -------
Three months ended 31 Three months ended 31
March 2016 March 2015
Before exceptional Before
items Exceptional Total exceptional Exceptional Total
items items items
Expenses US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Cost of sales
Mine production
costs (65,709) (5,932) (71,641) (64,585) (13,290) (77,875)
Movement in inventory (2,831) (509) (3,340) 2,639 (657) 1,982
Depreciation and
amortisation (26,719) - (26,719) (24,469) - (24,469)
------------------ ------------- --------- ------------ ------------- ---------
(95,259) (6,441) (101,700) (86,415) (13,947) (100,362)
------------------ ------------- --------- ------------ ------------- ---------
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 4: PROFIT BEFORE TAX (CONTINUED)
Three months ended 31 Three months ended 31
March 2016 March 2015
Before exceptional Before
items Exceptional Total exceptional Exceptional Total
items items items
Other operating costs US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Fixed royalty - Attributable
to the Egyptian government (4,432) - (4,432) (4,055) - (4,055)
Corporate administration
costs (1,800) - (1,800) (2,967) - (2,967)
Other expenses (45) - (45) (31) - (31)
Foreign exchange gain,
net 847 - 847 218 - 218
Provision for restoration
and rehabilitation
- unwinding of discount (145) - (145) (90) - (90)
Depreciation (27) - (27) (15) - (15)
(5,602) - (5,602) (6,940) - (6,940)
------------------ ------------- ------- ------------ ------------- -------
Reversal of Impairment
/ (Impairment) of
available for sale
financial assets (67) - (67) 327 - 327
------------------ ------------- ------- ------------ ------------- -------
Exceptional items
The directors consider that items of income or expense which are
material by virtue of their unusual, irregular or non-recurring
nature should be disclosed separately if the consolidated financial
statements are to fairly present the financial position and
underlying business performance. In order to allow a better
understanding of the financial information presented within the
consolidated financial statements, and specifically the Group's
underlying business performance, the effect of exceptional items is
shown below.
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Included in Cost of sales
Mine production costs (5,932) (13,290)
Movement in inventory (509) (657)
(6,441) (13,947)
------- --------
In January 2012, the Group received a letter from Chevron to the
effect that Chevron would not be able to continue supplying Diesel
Fuel Oil ("DFO") to the mine at Sukari at local subsidised prices.
It is understood that the reason that this letter was issued was
that Chevron had received a letter instructing it to do so from the
Egyptian General Petroleum Corporation ("EGPC"). It is understood
that EGPC itself took the decision to issue this instruction
because it had received legal advice from the Legal Advice
Department of the Council of State (an internal government advisory
department) that companies operating in the gold mining sector in
Egypt were not entitled to such subsidies. In addition, during 2012
the Group received a demand from Chevron for the repayment of fuel
subsidies received in the period from late 2009 through to January
2012, amounting to EGP403 million (US$45 million at current
exchange rates).
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 4: PROFIT BEFORE TAX (CONTINUED)
The Group has taken detailed legal advice on this matter and in
consequence in June 2012 lodged an appeal against EGPC's decision
in the Administrative Court. Again, the Group believes that its
grounds for appeal are strong and that there is every prospect of
success. However, as a practical matter, and in order to ensure the
continuation of supply, the Group has since January 2012 advanced
funds to its fuel supplier based on the international price of
diesel.
As at the date of the financial statements, no final decision
had been taken by the courts regarding this matter. The Group is of
the view that an instant move to international fuel prices is not a
reasonable outcome and will look to recover funds advanced thus far
should the court proceeding be concluded in its favour. However,
management recognises the practical difficulties associated with
re-claiming funds from the government and for this reason has
provided against the prepayment of US$5.028 million made during Q1
2016 as an exceptional item, as follows:
a) a US$6.44 million increase in overall cost of sales; and
b) a US$2.74 million increase in down payment advance for fuel procurement.
NOTE 5: PREPAYMENTS
Three Months Year Ended
Ended 31 December
31 March 2015
2016
(Unaudited) (Audited)
US$'000 US$'000
Non-current Prepayments
Advance payment to EMRA 28,750 28,750
------ ------
Current Prepayments
Prepayments 733 1,161
Fuel prepayments 1,334 -
----- -----
2,067 1,161
----- -----
Movement in fuel prepayments (1)
Balance at the beginning of the period - -
Fuel prepayment recognised 5,028 12,427
Less: Provision charged to (2) :
Mine production costs (see Note 4) (5,932) (13,290)
Stores inventory (509) (657)
Down payment advance for fuel procurement 2,747 1,520
Balance at the end of the period 1,334 -
------- --------
(1) The cumulative fuel prepayment recognised and provision
charged as at 31 March 2016 is as follows:
Fuel prepayment recognised (US$'000) 213,233
Provision charged to:
Mine production costs (US$'000) 201,089
Property, plant and equipment (US$'000) 11,852
Inventories (US$'000) (1,041)
Fuel prepayment balance (US$'000) 1,334
(2) Refer to Note 4, Exceptional Items, for further details.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 6: COMMITMENTS
The following is a summary of the Company's outstanding
commitments as at 31 March 2016:
Payments due Total < 1 year 1 to 5 >5 years
US$'000 US$'000 years US$'000
US$'000
Operating Lease Commitments 170 68 102 -
--------- --------- --------- ---------
Total commitments 170 68 102 -
--------- --------- --------- ---------
These commitments are limited to the office premises in
Jersey.
NOTE 7: CONTINGENT LIABILITIES AND CONTINGENT ASSETS
Contingent Liabilities
Fuel Supply
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As detailed in Note 4 above, the Group is involved in litigation
concerning the price at which it is supplied fuel. As detailed
therein, the Group has, since January 2012, advanced funds to its
supplier based on the international price of fuel whilst its appeal
to pay local subsidised prices is resolved. As set out in Note 4,
the Group recognises the practical difficulties associated with
reclaiming funds from the government and for this reason has fully
provided against the prepayment of US$213.2 million, as an
exceptional item. Refer to Notes 4 and 5 of the accompanying
financial statements for further details on the impact of this
exceptional provision on the Group's results for Q1 2016.
No provision has been made in respect of the historic subsidies
prior to January 2012 as, based on legal advice, the Company
believes that the prospects of a court finding in its favour in
relation to this matter remain very strong.
Concession Agreement Court Case
On 30 October 2012, the Administrative Court in Egypt handed
down a judgment in relation to a claim brought by, amongst others,
an independent member of a previous parliament, in which he argued
for the nullification of the agreement that confers on the Group
rights to operate in Egypt.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 7: CONTINGENT LIABILITIES AND CONTINGENT ASSETS
(CONTINUED)
This agreement, the Concession Agreement, was entered into
between the Arab Republic of Egypt, the Egyptian Mineral Resources
Authority ("EMRA") and Centamin's wholly--owned subsidiary Pharaoh
Gold Mines ("PGM"), and was approved by the People's Assembly as
Law 222 of 1994.
In summary, that judgment states that, although the Concession
Agreement itself remains valid and in force, insufficient evidence
had been submitted to the court in order to demonstrate that the
160km(2) "exploitation lease" between PGM and EMRA had received
approval from the relevant minister as required by the terms of the
Concession Agreement. Accordingly, the court found that the
exploitation lease in respect of the area of 160km(2) was not valid
although it stated that there was in existence such a lease in
respect of an area of 3km(2) . Centamin, however, is in possession
of the executed original lease documentation which clearly shows
that the 160km(2) exploitation lease was approved by the Minister
of Petroleum and Mineral Resources. It appears that an executed
original document was not supplied to the court.
Upon notification of the judgment, the Group took various steps
to protect its ability to continue to operate the mine at Sukari.
These included lodging a formal appeal before the Supreme
Administrative Court on 26 November 2012. In addition, in
conjunction with the formal appeal the Group applied to the Supreme
Administrative Court to suspend the initial decision until such
time as the court was able to consider and rule on the merits of
the appeal. On 20 March 2013, the court upheld this application
thus suspending the initial decision and providing assurance that
normal operations would be able to continue whilst the appeal
process is under way. EMRA has lodged its own appeal in relation to
this matter which is supportive of the Company's position in this
matter.
Furthermore, in late December 2012, the Minister of Petroleum
lodged a supporting appeal and shortly thereafter publicly
indicated that, in his view, the terms of the Concession Agreement
were fair and that the "exploitation" lease was valid. The Minister
of Petroleum also expressed support for the investment and
expertise that Centamin brings to the country. The Company believes
this demonstrates the government's commitment to its investment at
Sukari and the desire to stimulate further investment in the
Egyptian mining industry.
The Company has taken extensive legal advice on the merits of
its appeal from a number of leading Egyptian law firms who have
confirmed that the proper steps were followed with regard to the
grant of the 160km(2) lease. In addition, the Company has been
advised that it should benefit from law no. 32 of 2014, which came
into force in April 2014 and which restricts the capacity for third
parties to challenge any contractual agreement between the Egyptian
government and an investor. This law, whilst in force and ratified
by the new parliament, is currently under review by the Supreme
Constitutional Court of Egypt. The Group, therefore, remains of the
view that the appeal is based on strong legal grounds and will
ultimately be successful. After a series of delays and
adjournments, the Concession Agreement appeal has now been set down
for judgment on 24 May 2016. If the judgment is a final judgment,
the Company expects it will be in its favour. However, it has been
advised that the Egyptian legal system allows for the possibility
of an interim judgment staying the appeal until the Supreme
Constitutional Court has ruled on the validity of law no. 32.
In the event that the appellate court fails to be persuaded of
the merits of the case put forward by the Group, the operations at
Sukari may be adversely affected to the extent that the Group's
operation exceeds the exploitation lease area of 3km(2) referred to
in the original court decision.
The Company remains confident that normal operations at Sukari
will be maintained whilst the appeal process is under way. Centamin
does not currently see the need to take the matter to a court
outside of Egypt as Centamin remains of the belief that the
Egyptian Court will rule in Centamin's favour.
Contingent Assets
There were no contingent assets at period-end (31 March 2016:
nil; 31 December 2015: nil).
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 8: ISSUED CAPITAL
Fully Paid Ordinary Shares Three Months Ended Year Ended
31 March 2016 31 December 2015
(Unaudited) (Audited)
Number US$'000 Number US$'000
Balance at beginning of the period 1,152,107,984 665,590 1,152,107,984 661,573
Issue of shares (1) - - - 38
Own shares acquired during the
period - - - -
Transfer from share options reserve - - - 3,979
Balance at end of the period 1,152,107,984 665,590 1,152,107,984 665,590
------------- ------- -------------- --------
(1) Fully paid ordinary shares carry one vote per share and
carry the right to dividends.
NOTE 9: RELATED PARTY TRANSACTIONS
The related party transactions for the three months ended 31
March 2016 are summarised below:
- Salaries, superannuation contributions, bonuses, consulting
and Directors' fees paid to Directors during the three months ended
31 March 2016 amounted to US$608,048 (31 March 2015:
US$618,661).
- Mr J El-Raghy is a Director and shareholder of El-Raghy
Kriewaldt Pty Ltd ("ELK"), which provides office premises to the
Company in Australia. All dealings with ELK are in the ordinary
course of business and on normal terms and conditions. Rent paid to
ELK during the three months ended 31 March 2016 amounted to
US$11,011 (31 March 2015: US$11,653).
NOTE 10: EARNINGS PER SHARE
Basic earnings per share are calculated using the weighted
average number of shares outstanding. Diluted earnings per share
are calculated using the treasury stock method. In order to
determine diluted earnings per share, the treasury stock method
assumes that any proceeds from the exercise of dilutive stock
options and warrants would be used to repurchase common shares at
the average market price during the period, with the incremental
number of shares being included in the denominator of the diluted
earnings per share calculation. The diluted earnings per share
calculation exclude any potential conversion of options and
warrants that would increase earnings per share.
Three Months Ended
31 March
(Unaudited)
2016 2015
Cents Per Cents Per
Share Share
Basic earnings per share 3.56 2.50
Diluted earnings per share 3.51 2.48
------------ ------------
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 10: EARNINGS PER SHARE (CONTINUED)
Basic earnings per share
The earnings and weighted average number of ordinary shares used
in the calculation of basic earnings per share are as follows:
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Earnings used in the calculation of basic
EPS 40,850 28,566
------------- ---------
Three Months Ended
31 March
(Unaudited)
2016 2015No.
No.
Weighted average number of ordinary shares
(MORE TO FOLLOW) Dow Jones Newswires
May 03, 2016 02:01 ET (06:01 GMT)
for the purpose of basic EPS 1,146,114,943 1,142,286,601
---------------------- -------------
Diluted earnings per share
The earnings and weighted average number of ordinary shares used
in the calculation of diluted earnings per share are as
follows:
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Earnings used in the calculation of diluted
EPS 40,850 28,566
-------------- ---------------
Three Months Ended
31 March
(Unaudited)
2016 2015
No. No.
Weighted average number of ordinary shares
for the purpose of basic EPS 1,146,114,943 1,142,286,601
Shares deemed to be issued for no consideration
in respect of employee options 16,649,502 9,668,331
-------------- ---------------
Weighted average number of ordinary shares
used in the calculation of diluted EPS 1,162,764,445 1,151,954,932
-------------- ---------------
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 11: PROPERTY, PLANT AND EQUIPMENT
Three Months
Ended
31 March 2016 Office Land Plant Mining Mine Development Capital
(Unaudited) equipment and buildings and equipment equipment properties WIP Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Cost
Balance at 31
December 2015 5,535 1,194 582,854 241,316 316,304 32,469 1,179,672
Additions 18 26 17 - - 11,626 11,687
Disposals - - - (184) - - (184)
Transfers 17 - - 678 (26) (669) -
----------- --------------- --------------- ----------- ----------------- -------- ---------
Balance at 31
March 2016 5,570 1,220 582,871 241,810 316,278 43,426 1,191,175
----------- --------------- --------------- ----------- ----------------- -------- ---------
Accumulated
depreciation
Balance at 31
December 2015 (4,867) (293) (98,504) (100,826) (103,715) - (308,205)
Depreciation and
amortisation (128) (15) (7,483) (7,198) (11,918) - (26,742)
Disposals - - - 184 - - 184
----------- --------------- --------------- ----------- ----------------- -------- ---------
Balance at 31
March 2016 (4,995) (308) (105,987) (107,840) (115,633) - (334,763)
----------- --------------- --------------- ----------- ----------------- -------- ---------
Year Ended 31
December 2015
(Audited)
Cost
Balance at 31
December 2014 5,401 1,186 565,836 221,178 232,921 116,772 1,143,294
Additions 103 8 147 3,779 - 28,781 32,818
Increase in rehabilitation
asset - - - - 3,762 - 3,762
Disposals - - - (202) - - (202)
Transfers 31 - 16,871 16,561 79,621 (113,084) -
-------- ------ --------- ---------- ---------- ---------- ---------
Balance at 31
December 2015 5,535 1,194 582,854 241,316 316,304 32,468 1,179,672
-------- ------ --------- ---------- ---------- ---------- ---------
Accumulated depreciation
Balance at 31
December 2014 (4,280) (234) (67,980) (72,339) (69,497) - (214,330)
Depreciation and
amortisation (587) (59) (30,524) (28,663) (34,218) - (94,051)
Disposals - - - 176 - - 176
-------- ------ --------- ---------- ---------- ---------- ---------
Balance at 31
December 2015 (4,867) (293) (98,504) (100,826) (103,715) - (308,205)
-------- ------ --------- ---------- ---------- ---------- ---------
Net book value
As at 31 December
2015 668 901 484,350 140,490 212,589 32,469 871,467
-------- ------ --------- ---------- ---------- ---------- ---------
As at 31 March
2016 575 912 476,884 133,970 200,645 43,426 856,412
-------- ------ --------- ---------- ---------- ---------- ---------
NOTE 12: EXPLORATION AND EVALUATION ASSETS
Three Months Year Ended
Ended
31 March 31 December
2016
(Unaudited) 2015
US$'000 (Audited)
US$'000
Balance at the beginning of the period 152,077 123,999
Expenditure for the period 13,118 34,372
Impairment of exploration and evaluation
asset (85) (6,294)
------------ ------------
Balance at the end of the period 165,110 152,077
------------ ------------
The exploration and evaluation asset relates to the drilling,
geological exploration and sampling of potential ore reserves.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 13: AVAILABLE-FOR-SALE FINANCIAL ASSETS
The unrealised losses on available-for-sale investments
recognised in other comprehensive income were as follows:
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Profit /(Loss) on fair value of investment -
other comprehensive income 21 136
---------------- --------
The available for sale financial asset at period-end relates to
an 11.34% (2015: 11.34%) equity interest in Nyota, a listed public
company as well as a 1.6% interest in KEFI, a listed public
company.
As a result of the prolonged decline in the fair value in the
prior year of the investment in Nyota, the prior period devaluation
had been recognised as an impairment loss in the Statement of
Comprehensive Income.
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Reversal of Impairment loss / (Impairment loss) (67) 327
---------------- --------
NOTE 14: SHARE BASED PAYMENTS
No share based payments were awarded or granted to employees
during the first quarter.
NOTE 15: FINANCIAL INSTRUMENTS' FAIR VALUE DISCLOSURES
The Group has no financial instruments with fair values that are
determined by reference to significant unobservable inputs, i.e.
those that would be classified as level 3 in the fair value
hierarchy, nor have there been any transfers of assets or
liabilities between levels of the fair value hierarchy.
The Group's interest in Nyota Minerals Limited is classified as
an available for sale financial asset (see note 13). The Group
carries its interest in Nyota Minerals Limited at fair value, and
measures its interest using Level 1 unadjusted quoted prices.
The directors consider that the carrying amounts of financial
assets and financial liabilities carried at amortised cost
approximate their amortised cost.
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NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED 31 MARCH 2016 (CONTINUED)
NOTE 16: NOTES TO THE STATEMENTS OF CASH FLOWS
(a) Reconciliation of cash and cash equivalents
For the purpose of the statements of cash flows, cash and cash
equivalents includes cash on hand and at bank and deposits.
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Cash and cash equivalents 234,461 163,351
------------ ----------
(b) Reconciliation of profit for the period to cash flows from
operating activities
Three Months Ended
31 March
(Unaudited)
2016 2015
US$'000 US$'000
Profit for the period 40,850 28,566
Add/(less) non-cash items:
Depreciation / amortisation of property, plant
and equipment 26,746 24,484
Increase in provisions 419 1,034
Stock write off - 1
Foreign exchange rate (loss) (809) (281)
Impairment of exploration and evaluation assets 85 -
Impairment loss/(reversal of) of available-for-sale
financial assets 67 (327)
Share based payments (339) 715
Changes in working capital during the period
:
(Increase)/decrease in trade and other receivables (3,623) 114
Decrease in inventories 9,009 361
(Increase)/decrease in prepayments (906) 334
(Decrease)/increase in trade and other payables (11,017) 1,704
------------- ---------
Cash flows generated from operating activities 60,482 56,705
------------- ---------
(c) Non-cash financing and investing activities
There have been no non-cash financing and investing activities
during the current period quarter.
NOTE 18: SUBSEQUENT EVENTS
Other than the above, there has not arisen in the interval
between the end of the financial period and the date of this report
any item, transaction or event of a material and unusual nature
likely in the opinion of the directors of the Company to affect
significantly the operations of the company, the results of those
operations, or the state of affairs of the Company in subsequent
financial periods.
The accompanying Form 52 109FS certification of interim filings
is published, inter alia, for the purposes, of discharging the
Company's obligations arising in connection with the listing of its
shares on the Toronto Stock Exchange.
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This document contains "forward-looking information" which may
include, but is not limited to, statements with respect to the
future financial or operating performance of Centamin plc
('Centamin' or 'the Company'), its subsidiaries (together 'the
Group'), affiliated companies, its projects, the future price of
gold, the estimation of mineral reserves and mineral resources, the
realization of mineral reserve and resource estimates, the timing
and amount of estimated future production, revenues, margins, costs
of production, estimates of initial capital, sustaining capital,
operating and exploration expenditures, costs and timing of the
development of new deposits, costs and timing of future
exploration, requirements for additional capital, foreign exchange
risks, governmental regulation of mining operations and exploration
operations, timing and receipt of approvals, consents and permits
under applicable mineral legislation, environmental risks, title
disputes or claims, limitations of insurance coverage and
regulatory matters. Often, but not always, forward-looking
statements can be identified by the use of words such as "plans",
"expects", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "targets", "aims", "anticipates" or
"believes" or variations (including negative variations) of such
words and phrases, or may be identified by statements to the effect
that certain actions, events or results "may", "could", "would",
"should", "might" or "will" be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks,
uncertainties and a variety of material factors, many of which are
beyond the Company's control which may cause the actual results,
performance or achievements of Centamin, its subsidiaries and
affiliated companies to be materially different from any future
results, performance or achievements expressed or implied by the
forward-looking statements. Readers are cautioned that
forward-looking statements may not be appropriate for other
purposes than outlined in this document. Such factors include,
among others, future price of gold; general business, economic,
competitive, political and social uncertainties; the actual results
of current exploration and development activities; conclusions of
economic evaluations and studies; fluctuations in the value of the
U.S. dollar relative to the local currencies in the jurisdictions
of the Company's key projects; changes in project parameters as
plans continue to be refined; possible variations of ore grade or
projected recovery rates; accidents, labour disputes or slow-downs
and other risks of the mining industry; climatic conditions;
political instability, insurrection or war, civil unrest or armed
assault; labour force availability and turnover; delays in
obtaining financing or governmental approvals or in the completion
of exploration and development activities; as well as those factors
referred to in the section entitled "Principal Risks affecting the
Centamin Group" section of the Management Discussion & Analysis
filed on SEDAR. The reader is also cautioned that the foregoing
list of factors is not exhausted of the factors that may affect the
Company's forward-looking statements.
Although the Company 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 to
differ from those anticipated, estimated or intended.
Forward-looking statements contained herein are made as of the date
of this document and, except as required by applicable law, the
Company disclaims any obligation to update any forward-looking
statements, whether as a result of new information, future events
or results or otherwise. 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. Accordingly, readers should not
place undue reliance on forward-looking statements.
QUALIFIED PERSON AND QUALITY CONTROL
Information in this report which relates to exploration,
geology, sampling and drilling is based on information compiled by
geologist Mr Richard Osman and Christopher Boreham (Underground
Manager) who are full-time employees of the Company, and are
members of the Australasian Institute of Mining and Metallurgy each
with more than five years' experience in the fields of activity
being reported on, and are 'Competent Persons' for this purpose and
are "Qualified Persons" as defined in "National Instrument 43-101
of the Canadian Securities Administrators".
Refer to the latest technical report entitled "Mineral Resource
and Reserve Estimate for the Sukari Gold Project, Egypt" effective
30 June 2015 and dated 23 October 2015 and filed on SEDAR at
www.sedar.com, for further discussion of the extent to which the
estimate of mineral resources/reserves may be materially affected
by any known environmental, permitting, legal, title, taxation,
socio-political, or other relevant issues.
-------------------------------------------End of
Announcement------------------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
QRFZMGGKDZZGVZM
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May 03, 2016 02:01 ET (06:01 GMT)
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