LONDON, Aug. 14, 2015 /CNW/ - Horizonte Minerals
Plc, (AIM: HZM, TSX: HZM) ('Horizonte' or 'the Company') the
nickel development company focused in Brazil, announces its unaudited financial
results for the six months ended 30 June
2015 and the Management Discussion and Analysis for the same
period.
Both of the above have been posted on the Company's website at
www.horizonteminerals.com and are also available on SEDAR at
www.sedar.com.
Overview
- Good progress made in first half of 2015 on advancement of the
100%-owned Araguaia Nickel Project in Para State, north central
Brazil ('Araguaia')
- Successfully completed 10,255 metre infill resource drilling
programme designed to convert initial 7-8 years of the 25 year
modelled mine life to Measured Resource category
- High grade nickel intersections from infill resource drilling
on the Pequizeiro deposit include 11.30 meters grading 2.95% Ni;
9.21 meters grading 2.50% Ni; and 11.82 meters grading 2.39%
Ni
- Continued de-risking of Araguaia with positive initial results
from 1st stage testing of Rotary Kiln Electric Furnace
('RKEF') Pilot Plant, ahead of next stage of testing with a further
circa 200 tonne continuous, full scale RKEF pilot plant campaign,
which aims to produce ferro-nickel to a commercial
specification
- Positive outcome from Public Hearing for Araguaia, held on
30 January 2015, attended by over
1,000 people to consider the Social and Environmental Impact
Assessment submitted to Brazilian authorities in Q3 2014
- Cost reduction plan completed to lower the overall operating
costs and preserve funds while advancing the project
- Strong cash position of £2.4 million
Chairman's Statement
The first half of 2015 has seen Horizonte achieve a number of
key milestones in the advancement of the Araguaia Nickel Project in
Brazil. These include a positive outcome of the Public
Hearing, reiterating the support we have gained from the local
community and government authorities in Brazil; strong results from the agglomeration
tests, part of the first phase of the Rotary Kiln Electric Furnace
('RKEF') pilot plant testwork; and the successful completion of the
final phase of infill drilling which demonstrated the consistently
high grade nature of the core resource areas. All of these
are components of the various studies that will ultimately be fed
into the Feasibility Study and we are delighted to have made such
progress despite very challenging market conditions and negative
sentiment towards the mineral resource sector.
We are advancing Araguaia as the next major nickel mine in
Brazil and have completed a number
of key milestones towards this goal as outlined above.
However permitting is always an issue that concerns shareholders of
a major project such as ours. The positive outcome at the
Public Hearing is a critical factor in the success of Araguaia and
a significant milestone towards receiving our Preliminary Licence
('LP') and the culmination of the past 18 month's social and
environmental work. There is still work to be completed in
order to obtain the LP, with the process running approximately six
months behind schedule, principally due to changes of personnel in
the Government Licensing agency. It is important to note that
the delay is not related to any project factors. Horizonte is
committed to providing sustainability and benefits to the community
in and around Araguaia by bringing the project to full
production.
Another aspect which is a risk factor, especially in the case of
nickel laterite ore bodies, is metallurgical processing and the
recovery of nickel. The positive results from the first stage
testing of the RKEF Pilot Plant were a major step in de-risking
this aspect and demonstrating excellent product quality. It
is crucial to create the right blend of ore feed at this first
stage in the process flow sheet to ensure that there are no
problems that could affect the process once in full production.
We were delighted that the Araguaia material tested provided
excellent ore feed with low dust levels and right particle size to
optimise the process towards production of ferro-nickel.
Following this positive testing, we announced in late
April 2015 the completion of the
large bulk sample of approximately 240 tonnes to feed into the
pilot plant for an 18 to 20 day period 24 hours per day to produce
nickel. At time of writing the detailed compilation of
results of this work are outstanding and we plan to report to you
as soon as all the various aspects of the process have been
compiled and interpreted.
In parallel with the work streams above was the completion of
the fourth and final phase of drilling that was aimed at providing
further drill data for upgrading the reserve estimate. We were
delighted with the multiple high grade intercepts obtained from the
drilling including 11.3 meters grading 2.95% Ni, 9.21 meters
grading 2.50% Ni and 18.99 meters grading 2.27% Ni. These
results increase our confidence for the high grade zones within the
deposit that will support the early years in the mine life.
These grades demonstrate that Araguaia contains a number of
high grade zones supporting a high ore feed grade for the early
part of the mine schedule which is key to the overall economics of
the project.
High quality projects (large size, high grade, low cost) will
always create value and despite the volatile nickel prices in the
last 24 months we believe Araguaia will be positioned to deliver
value at the right time in the mining cycle. Demand for nickel
mainly through the stainless steel market is robust. There
are limited next generation projects for development worldwide and
this is where Araguaia stands out. The nickel market is
predicted to be in deficit from late 2016 and by 2018 there is an
expected shortfall for some 778,000 tonnes of nickel to support a
balanced market. The metals business has and always will be a
cyclical long term undertaking and as a result of this shortfall we
strongly believe that we will see a longer term improved nickel
price widely recognised as being +US$20,000/tonne.
Horizonte has through good management advanced Araguaia through
a sustained period of falling commodity prices and with exciting
news flow on the horizon including the Pilot Plant results we are
ticking the boxes on our route to delivering a Feasibility Study as
we progress towards nickel production in Brazil. We are positioning and adjusting the
development to fit with the next cycle of rising metal prices in
line with providing the utmost value for our loyal shareholder base
and I look forward to providing further updates in due course.
David J. Hall
Chairman
14 August 2015
Horizonte Minerals
plc
|
|
|
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Interim Financial Statements for the six months ended
30 June 2015
|
|
|
|
|
|
|
|
|
|
|
|
Condensed
consolidated statement of comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6 months
ended
30
June
|
|
3 months
ended
30
June
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
|
Notes
|
|
£
|
|
£
|
|
£
|
|
£
|
Continuing
operations
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
Cost of
sales
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Administrative
expenses
|
|
|
|
(415,968)
|
|
(654,545)
|
|
(201,531)
|
|
(396,452)
|
Charge for share
options granted
|
|
|
|
(86,890)
|
|
(34,351)
|
|
(44,679)
|
|
(29,631)
|
Change in value of
contingent consideration
|
|
|
|
(55,063)
|
|
525,763
|
|
190,312
|
|
95,808
|
Project
impairment
|
|
|
|
-
|
|
(31,989)
|
|
-
|
|
-
|
Loss on foreign
exchange
|
|
|
|
(196,620)
|
|
(31,960)
|
|
(69,478)
|
|
(22,099)
|
Other losses –
Impairment of available for sale assets
|
|
|
|
(253,006)
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
|
|
(1,007,547)
|
|
(227,082)
|
|
(125,376)
|
|
(352,374)
|
|
|
|
|
|
|
|
|
|
|
|
Finance
income
|
|
|
|
10,329
|
|
9,980
|
|
3,212
|
|
3,758
|
Finance
costs
|
|
|
|
(161,963)
|
|
(86,952)
|
|
(80,982)
|
|
(43,476)
|
|
|
|
|
|
|
|
|
|
|
|
Loss before
taxation
|
|
|
|
(1,159,181)
|
|
(304,054)
|
|
(203,146)
|
|
(392,092)
|
|
|
|
|
|
|
|
|
|
|
|
Taxation
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the year
from continuing operations
|
|
|
|
(1,159,181)
|
|
(304,054)
|
|
(203,146)
|
|
(392,092)
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income
|
|
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to profit or loss
Change in value of
available for sale financial assets
|
|
|
|
253,006
|
|
(768)
|
|
-
|
|
224
|
Currency translation
differences on translating foreign operations
|
|
|
|
(3,693,733)
|
|
863,047
|
|
(766,850)
|
|
(45,919)
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income for the period, net of tax
|
|
|
|
(3,440,727)
|
|
862,279
|
|
(766,850)
|
|
(45,695)
|
Total
comprehensive income for the period
|
|
|
|
|
|
|
|
|
|
|
attributable to
equity holders of the Company
|
|
|
|
(4,599,908)
|
|
558,225
|
|
(969,996)
|
|
(437,787)
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
from continuing operations attributable
to the equity holders of the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
(pence per share)
|
|
9
|
|
(0.235)
|
|
(0.076)
|
|
(0.041)
|
|
(0.098)
|
Condensed
consolidated statement of financial position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30
June
|
|
|
31
December
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
Unaudited
|
|
|
Audited
|
|
|
|
|
|
|
Notes
|
|
£
|
|
|
£
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
assets
|
|
|
|
|
|
6
|
|
19,418,641
|
|
|
20,770,312
|
Property, plant &
equipment
|
|
|
|
|
|
|
|
24,881
|
|
|
54,390
|
Deferred tax
assets
|
|
|
|
|
|
|
|
4,293,658
|
|
|
5,065,976
|
|
|
|
|
|
|
|
|
23,737,180
|
|
|
25,890,678
|
Current
assets
|
|
|
|
|
|
|
|
|
|
|
|
Trade and other
receivables
|
|
|
|
|
|
|
|
15,925
|
|
|
22,709
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
2,415,706
|
|
|
5,030,968
|
|
|
|
|
|
|
|
|
2,431,631
|
|
|
5,053,677
|
Total
assets
|
|
|
|
|
|
|
|
26,168,811
|
|
|
30,944,355
|
Equity and
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Equity
attributable to owners of the parent
|
|
|
|
|
|
|
|
|
|
|
|
Issued
capital
|
|
|
|
|
|
7
|
|
4,924,271
|
|
|
4,924,271
|
Share
premium
|
|
|
|
|
|
7
|
|
31,095,370
|
|
|
31,095,370
|
Other
reserves
|
|
|
|
|
|
|
|
(3,762,328)
|
|
|
(321,601)
|
Accumulated
losses
|
|
|
|
|
|
|
|
(10,599,160)
|
|
|
(9,526,869)
|
Total
equity
|
|
|
|
|
|
|
|
21,658,153
|
|
|
26,171,171
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Contingent
consideration
|
|
|
|
|
|
|
|
2,452,538
|
|
|
2,235,512
|
Deferred tax
liabilities
|
|
|
|
|
|
|
|
1,866,112
|
|
|
2,201,178
|
|
|
|
|
|
|
|
|
4,318,650
|
|
|
4,437,290
|
Current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Trade and other
payables
|
|
|
|
|
|
|
|
192,008
|
|
|
335,894
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
|
|
|
|
|
4,510,658
|
|
|
4,773,184
|
Total equity and
liabilities
|
|
|
|
|
|
|
|
26,168,811
|
|
|
30,944,355
|
Condensed
statement of changes in shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to the
owners of the parent
|
|
|
Share
capital
£
|
|
Share
premium
£
|
|
Accumulated
losses
£
|
|
Other
reserves
£
|
|
Total
£
|
|
|
|
|
|
|
|
|
|
|
|
As at 1 January
2014
|
|
4,011,395
|
|
26,997,998
|
|
(8,410,040)
|
|
1,139,550
|
|
23,738,903
|
Comprehensive
income
|
|
|
|
|
|
|
|
|
|
|
Loss for the
period
|
|
-
|
|
-
|
|
(304,054)
|
|
-
|
|
(304,054)
|
Other
comprehensive income
|
|
|
|
|
|
|
|
|
|
|
Change in value of
available for sale
financial assets
|
|
-
|
|
-
|
|
-
|
|
(768)
|
|
(768)
|
Currency translation
differences
|
|
-
|
|
-
|
|
-
|
|
863,047
|
|
863,047
|
Total
comprehensive income
|
|
-
|
|
-
|
|
(304,054)
|
|
862,279
|
|
558,225
|
Transactions with
owners
|
|
|
|
|
|
|
|
|
|
|
Share based
payments
|
|
-
|
|
-
|
|
34,351
|
|
-
|
|
34,351
|
Total transactions
with owners
|
|
-
|
|
-
|
|
34,351
|
|
-
|
|
34,351
|
As at 30 June
2014
|
|
4,011,395
|
|
26,997,998
|
|
(8,679,743)
|
|
2,001,829
|
|
24,331,479
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to the
owners of the parent
|
|
|
Share
capital
£
|
|
Share
premium
£
|
|
Accumulated
losses
£
|
|
Other
reserves
£
|
|
Total
£
|
|
|
|
|
|
|
|
|
|
|
|
As at 1 January
2015
|
|
4,924,271
|
|
31,095,370
|
|
(9,526,869)
|
|
(321,601)
|
|
26,171,171
|
Comprehensive
income
|
|
|
|
|
|
|
|
|
|
|
Loss for the
period
|
|
-
|
|
-
|
|
(1,159,181)
|
|
-
|
|
(1,159,181)
|
Other
comprehensive income
|
|
|
|
|
|
|
|
|
|
|
Impairment of
available for sale assets
|
|
-
|
|
-
|
|
-
|
|
253,006
|
|
253,006
|
Currency translation
differences
|
|
-
|
|
-
|
|
-
|
|
(3,693,733)
|
|
(3,693,733)
|
Total
comprehensive income
|
|
-
|
|
-
|
|
(1,159,181)
|
|
(3,440,727)
|
|
(4,599,908)
|
Transactions with
owners
|
|
|
|
|
|
|
|
|
|
|
Share based
payments
|
|
-
|
|
-
|
|
86,890
|
|
-
|
|
86,890
|
Total transactions
with owners
|
|
-
|
|
-
|
|
86,890
|
|
-
|
|
86,890
|
As at 30 June
2015
|
|
4,924,271
|
|
31,095,370
|
|
(10,599,160)
|
|
(3,762,328)
|
|
21,658,153
|
Condensed
Consolidated Statement of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
6 months
ended
30
June
|
|
3 months
ended
30
June
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
|
£
|
|
£
|
|
£
|
|
£
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Loss before
taxation
|
|
(1,159,181)
|
|
(304,054)
|
|
(203,146)
|
|
(392,092)
|
Interest
income
|
|
(10,329)
|
|
(9,980)
|
|
(3,212)
|
|
(3,758)
|
Finance
costs
|
|
161,963
|
|
86,952
|
|
80,982
|
|
43,476
|
Loss on disposal of
subsidiary
|
|
3,848
|
|
-
|
|
-
|
|
-
|
Realisation of
Peruvian Reserves
|
|
13,353
|
|
-
|
|
-
|
|
-
|
Impairment of
available for sale financial assets
|
|
253,005
|
|
-
|
|
-
|
|
-
|
Project
impairment
|
|
-
|
|
31,989
|
|
-
|
|
-
|
Gain on sale of fixed
asset
|
|
(11,011)
|
|
-
|
|
(11,011)
|
|
-
|
Exchange
differences
|
|
196,620
|
|
31,960
|
|
69,478
|
|
22,099
|
Employee share
options charge
|
|
86,890
|
|
34,351
|
|
44,679
|
|
29,631
|
Change in fair value
of contingent consideration
|
|
55,063
|
|
(525,763)
|
|
(190,312)
|
|
(95,808)
|
Depreciation
|
|
819
|
|
2,041
|
|
407
|
|
980
|
Operating loss
before changes in working capital
|
|
(408,960)
|
|
(652,504)
|
|
(212,135)
|
|
(395,472)
|
Decrease/(increase)
in trade and other receivables
|
|
6,034
|
|
13,130
|
|
6,313
|
|
(18,346)
|
(Decrease)/increase
in trade and other payables
|
|
(61,358)
|
|
48,551
|
|
17,238
|
|
77,110
|
Net cash outflow
from operating activities
|
|
(464,284)
|
|
(590,823)
|
|
(188,584)
|
|
(336,708)
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
Purchase of
intangible assets
|
|
(1,978,727)
|
|
(1,105,901)
|
|
(870,162)
|
|
(606,238)
|
Proceeds from sale of
property, plant and equipment
|
|
13,292
|
|
-
|
|
13,292
|
|
-
|
Interest
received
|
|
10,329
|
|
9,980
|
|
3,213
|
|
3,758
|
Net cash used in
investing activities
|
|
(1,955,106)
|
|
(1,095,921)
|
|
(853,657)
|
|
(602,480)
|
Net decrease in
cash and cash equivalents
|
|
(2,419,390)
|
|
(1,686,744)
|
|
(1,042,241)
|
|
(939,188)
|
Cash and cash
equivalents at beginning of period
|
|
5,030,968
|
|
3,091,880
|
|
3,527,280
|
|
2,334,463
|
Exchange loss on cash
and cash equivalents
|
|
(195,872)
|
|
(31,960)
|
|
(69,333)
|
|
(22,099)
|
Cash and cash
equivalents at end of the period
|
|
2,415,706
|
|
1,373,176
|
|
2,415,706
|
|
1,373,176
|
Notes to the Financial Statements
1. General information
The principal activity of the Company and its subsidiaries
(together 'the Group') is the exploration and development of
precious and base metals. There is no seasonality or cyclicality of
the Group's operations.
The Company's shares are listed on the Alternative Investment
Market of the London Stock Exchange (AIM) and on the Toronto Stock
Exchange (TSX). The Company is incorporated and domiciled in the
United Kingdom. The address of its
registered office is 26 Dover Street London W1S 4LY.
2. Basis of preparation
The condensed consolidated interim financial statements have
been prepared using accounting policies consistent with
International Financial Reporting Standards and in accordance with
International Accounting Standard 34 Interim Financial
Reporting. The condensed interim financial statements should be
read in conjunction with the annual financial statements for the
year ended 31 December 2014, which
have been prepared in accordance with International Financial
Reporting Standards (IFRS).
The condensed consolidated interim financial statements set out
above do not constitute statutory accounts within the meaning of
the Companies Act 2006. They have been prepared on a going concern
basis in accordance with the recognition and measurement criteria
of International Financial Reporting Standards (IFRS). Statutory
financial statements for the year ended 31
December 2014 were approved by the Board of Directors on
25 February 2015 and delivered to the
Registrar of Companies. The report of the independent auditor on
those financial statements was unqualified.
The condensed consolidated interim financial statements of the
Company have not been audited but have been reviewed by the
Company's auditor, PKF Littlejohn LLP.
Going concern
The Directors, having made appropriate enquiries, consider that
adequate resources exist for the Group to continue in operational
existence for the foreseeable future and that, therefore, it is
appropriate to adopt the going concern basis in preparing the
condensed consolidated interim financial statements for the period
ended 30 June 2015.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of
the business. The key risks that could affect the Group's medium
term performance and the factors that mitigate those risks have not
substantially changed from those set out in the Group's 2014 Annual
Report and Financial Statements, a copy of which is available on
the Group's website: www.horizonteminerals.com. The key financial
risks are liquidity risk, foreign exchange risk, credit risk, price
risk and interest rate risk.
Critical accounting estimates and judgements
The preparation of condensed interim financial statements
requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the end of the reporting
period. Significant items subject to such estimates are set out in
note 4 of the Group's 2014 Annual Report and Financial Statements.
The nature and amounts of such estimates have not changed
significantly during the interim period.
3. Significant accounting policies
The condensed interim financial statements have been prepared
under the historical cost convention as modified by the revaluation
of certain of the subsidiaries' assets and liabilities to fair
value for consolidation purposes.
The same accounting policies, presentation and methods of
computation have been followed in these condensed interim financial
statements as were applied in the preparation of the Group's
Financial Statements for the year ended 31
December 2014, except for the impact of the adoption of the
Standards and interpretations described below.
3.1. Changes in accounting policy and
disclosures
(a) New and amended standards adopted by the
Group
There are no IFRSs or IFRIC interpretations that are effective
for the first time for the financial year beginning 1 January 2015 that would be expected to have a
material impact on the Group.
(b) New and amended standards and
interpretations issued but not yet effective for the financial year
beginning 1 January 2015 and not
early adopted
The standards and interpretations that are issued, but not yet
effective, up to the date of issuance of the financial statements
are listed below. The Group intends to adopt these standards, if
applicable, when they become effective. Unless stated below,
there are no IFRSs or IFRIC interpretations that are not yet
effective that would be expected to have a material impact on the
Group.
Standard
|
|
Effective
Date
|
IAS 1
(Amendments)
|
Presentation of
Financial Statements: Disclosure
Initiative
|
1 January
2016
|
IAS 16
(Amendments)
|
Clarification of
Acceptable Methods of
Depreciation
|
1 January
2016
|
IAS 16
(Amendments)
|
Property, plant and
equipment: Bearer
Plants
|
1 January
2016
|
IAS 19
(Amendments)
|
Defined Benefit
Plans: Employee
Contributions
|
1 February
2015
|
IAS 27
(Amendments)
|
Separate Financial
Statements
|
1 January
2016
|
IAS 28
(Amendments)
|
Investments in
Associates and Joint
Ventures
|
1 January
2016
|
IAS 28
(Amendments)
|
Investment Entities:
Applying the Consolidation
Exception
|
1 January
2016
|
IAS 38
(Amendments)
|
Clarification of
Acceptable Methods of
Amortisation
|
1 January
2016
|
IAS 41
(Amendments)
|
Agriculture: Bearer
Plants
|
1 January
2016
|
IFRS
9
|
Financial
Instruments
|
1 January
2018
|
IFRS 10
(Amendments)
|
Contribution of
Assets between an
Investor
|
1 January
2016
|
|
and its Associate or
Joint Venture
|
|
IFRS 10
(Amendments)
|
Investment Entities:
Applying the Consolidation
Exception
|
1 January
2016
|
IFRS 11
(Amendments)
|
Joint Arrangements:
Accounting for Acquisitions
of
|
1 January
2016
|
|
Interests in Joint
Operations
|
|
IFRS 12
(Amendments)
|
Investment Entities:
Applying the Consolidation
Exception
|
1 January
2016
|
IFRS
14
|
Regulatory Deferral
Accounts
|
1 January
2016
|
IFRS
15
|
Revenue from
Contracts with
Customers
|
1 January
2018
|
Annual
Improvements
|
2010 – 2012
Cycle
|
1 February
2015
|
Annual
Improvements
|
2012 – 2014
Cycle
|
1 January
2016
|
4. Segmental reporting
The Group operates principally in the UK and Brazil, with operations managed on a project
by project basis within each geographical area. Activities in the
UK are mainly administrative in nature whilst the activities in
Brazil relate to exploration and
evaluation work. The reports used by the chief operating decision
maker are based on these geographical segments.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
UK
|
|
Brazil
|
|
Other
|
|
Total
|
|
|
6 months
ended
30 June
2015
£
|
|
6 months
ended
30 June
2015
£
|
|
6 months
ended
30 June
2015
£
|
|
6 months
ended
30 June
2015
£
|
Revenue
|
|
-
|
|
-
|
|
-
|
|
-
|
Administrative
expenses
|
|
(318,060)
|
|
(84,555)
|
|
(13,353)
|
|
(415,968)
|
Loss on foreign
exchange
|
|
(108,941)
|
|
(87,679)
|
|
-
|
|
(196,620)
|
Loss from operations
per reportable segment
|
|
(427,001)
|
|
(172,234)
|
|
(13,353)
|
|
(612,588)
|
Inter segment
revenues
|
|
-
|
|
427,513
|
|
-
|
|
427,513
|
Depreciation
charges
|
|
(519)
|
|
(300)
|
|
-
|
|
(819)
|
Additions to
non-current assets
|
|
-
|
|
1,310,368
|
|
-
|
|
1,310,368
|
Reportable segment
assets
|
|
2,269,845
|
|
23,898,966
|
|
-
|
|
26,168,811
|
Reportable segment
liabilities
|
|
2,503,815
|
|
2,006,843
|
|
-
|
|
4,510,658
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
UK
|
|
Brazil
|
|
Other
|
|
Total
|
|
|
6 months
ended
30 June
2014
£
|
|
6 months
ended
30 June
2014
£
|
|
6 months
ended
30
June 2014
£
|
|
6 months
ended
30 June
2014
£
|
Revenue
|
|
-
|
|
-
|
|
-
|
|
-
|
Administrative
expenses
|
|
(382,878)
|
|
(269,104)
|
|
(2,563)
|
|
(654,545)
|
Project and fixed
asset impairment
|
|
-
|
|
(31,989)
|
|
-
|
|
(31,989)
|
Loss on foreign
exchange
|
|
(20,259)
|
|
(11,701)
|
|
-
|
|
(31,960)
|
Other operating
income
|
|
-
|
|
-
|
|
-
|
|
-
|
Loss from operations
per reportable segment
|
|
(403,137)
|
|
(312,794)
|
|
(2,563)
|
|
(718,494)
|
Inter segment
revenues
|
|
-
|
|
310,265
|
|
33,033
|
|
343,298
|
Depreciation
charges
|
|
(1,576)
|
|
(465)
|
|
-
|
|
(2,041)
|
Additions to
non-current assets
|
|
-
|
|
1,111,645
|
|
-
|
|
1,111,645
|
Reportable segment
assets
|
|
1,663,920
|
|
27,308,940
|
|
30
|
|
28,972,890
|
Reportable segment
liabilities
|
|
2,129,423
|
|
2,511,988
|
|
-
|
|
4,641,411
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
UK
|
|
Brazil
|
|
Other
|
|
Total
|
|
|
3 months
ended
30 June
2015
|
|
3 months
ended
30 June
2015
|
|
3 months
ended
30 June
2015
|
|
3 months
ended
30 June
2015
|
|
|
£
|
|
£
|
|
£
|
|
£
|
Revenue
|
|
-
|
|
-
|
|
-
|
|
-
|
Administrative
expenses
|
|
(154,912)
|
|
(46,619)
|
|
-
|
|
(201,531)
|
Loss on foreign
exchange
|
|
(63,700)
|
|
(5,778)
|
|
-
|
|
(69,478)
|
Other operating
Income
|
|
-
|
|
-
|
|
-
|
|
-
|
Loss from operations
per reportable segment
|
|
(218,612)
|
|
(52,397)
|
|
-
|
|
(271,009)
|
Inter segment
revenues
|
|
-
|
|
221,935
|
|
-
|
|
221,935
|
Depreciation
charges
|
|
(260)
|
|
(147)
|
|
-
|
|
(407)
|
Additions to
non-current assets
|
|
--
|
|
28,722
|
|
-
|
|
28,722
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
UK
|
|
Brazil
|
|
Other
|
|
Total
|
|
|
3 months
ended
30 June
2014
|
|
3 months
ended
30 June
2014
|
|
3 months
ended
30 June
2014
|
|
3 months
ended
30 June
2014
|
|
|
£
|
|
£
|
|
£
|
|
£
|
Revenue
|
|
-
|
|
-
|
|
-
|
|
-
|
Administrative
expenses
|
|
(217,705)
|
|
(177,580)
|
|
(1,167)
|
|
(396,452)
|
Loss on foreign
exchange
|
|
(10,837)
|
|
(11,262)
|
|
-
|
|
(22,099)
|
Other operating
Income
|
|
-
|
|
-
|
|
-
|
|
-
|
Loss from operations
per reportable segment
|
|
(228,542)
|
|
(188,842)
|
|
(1,167)
|
|
(418,551)
|
Inter segment
revenues
|
|
-
|
|
158,033
|
|
16,568
|
|
174,601
|
Depreciation
charges
|
|
(788)
|
|
(192)
|
|
-
|
|
980
|
Additions to
non-current assets
|
|
-
|
|
598,107
|
|
-
|
|
598,107
|
|
|
|
|
|
|
|
|
|
A reconciliation of adjusted loss from operations per reportable
segment to loss before tax is provided as follows:
|
|
|
|
6 months
ended 30 June
2015
|
|
6 months
ended 30 June
2014
|
|
3 months
ended 30 June
2015
|
|
3 months
ended 30 June
2014
|
|
|
|
|
£
|
|
£
|
|
£
|
|
£
|
Loss from operations
per reportable segment
|
|
|
|
(612,588)
|
|
(718,494)
|
|
(271,009)
|
|
(418,551)
|
– Change in fair
value of contingent consideration
|
|
|
|
(55,063)
|
|
525,763
|
|
190,312
|
|
95,808
|
– Charge for share
options granted
|
|
|
|
(86,890)
|
|
(34,351)
|
|
(44,679)
|
|
(29,631)
|
– Impairment of
available for sale asset
|
|
|
|
(253,006)
|
|
-
|
|
-
|
|
-
|
– Finance
income
|
|
|
|
10,329
|
|
9,980
|
|
3,212
|
|
3,758
|
– Finance
costs
|
|
|
|
(161,963)
|
|
(86,952)
|
|
(80,982)
|
|
(43,476)
|
Loss for the period
from continuing operations
|
|
|
|
(1,159,181)
|
|
(304,054)
|
|
(203,146)
|
|
392,092
|
5. Change in Fair Value of Contingent
Consideration
Contingent consideration has a carrying value of £ 2,452,538 at
30 June 2015 (31 December 2014: £ 2,235,512). The contingent
consideration arrangement requires the Group to pay the former
owners of Teck Cominco Brasil S.A (subsequently renamed Araguaia
Niquel Mineração Ltda) 50% of the tax effect on utilisation of the
tax losses existing in Teck Cominco Brasil S.A at the date of
acquisition, which was completed in August
2010. Under the terms of the acquisition agreement, tax
losses that existed at the date of acquisition and which are
subsequently utilised in a period greater than 10 years from that
date are not subject to the contingent consideration
arrangement.
The fair value of this potential consideration has been
determined using the operating and financial assumptions in the
cash flow model derived from the Araguaia project pre-feasibility
study ("Pre-Feasibility Study") published by the Company in
March 2014 in order to calculate the
ability to utilise the acquired tax losses, together with the
timing of their utilisation. These cash flows could be affected by
upward or downward movements in several factors to include
commodity prices, operating costs, capital expenditure, production
levels, grades, recoveries and interest rates.
As at 30 June 2015, Management has
reassessed the fair value of the potential contingent consideration
in accordance with the Group's accounting policies. The change in
the fair value of contingent consideration has generated a debit to
profit or loss of £(55,063) in the six months ended 30 June 2015 (2014: £525,763 credit) due to
changes in the exchange rate of the functional currency in which
the liability is payable and in the timing of cash flows.
6. Intangible assets
Intangible assets comprise exploration and evaluation costs and
goodwill. Exploration and evaluation costs comprise internally
generated and acquired assets.
Group
|
|
|
|
|
|
|
|
Exploration
and
|
|
|
|
|
|
|
|
|
Goodwill
|
|
evaluation
costs
|
|
Total
|
|
|
|
|
|
|
£
|
|
£
|
|
£
|
Cost
|
|
|
|
|
|
|
|
|
|
|
At 1 January
2015
|
|
|
|
|
|
270,925
|
|
20,499,387
|
|
20,770,312
|
Additions
|
|
|
|
|
|
-
|
|
1,914,996
|
|
1,914,996
|
Exchange rate
movements
|
|
|
|
|
|
(41,303)
|
|
(3,225,364)
|
|
(3,266,667)
|
Net book amount at 30
June 2015
|
|
|
|
|
|
229,622
|
|
19,189,019
|
|
19,418,641
|
7. Share Capital and Share Premium
Issued and fully
paid
|
|
|
|
|
|
Number of
shares
|
|
|
Ordinary
shares
£
|
|
|
Share
premium
£
|
|
|
Total
£
|
At 1 January
2015
|
|
|
|
|
|
492,427,105
|
|
|
4,924,271
|
|
|
31,095,370
|
|
|
36,019,641
|
At 30 June
2015
|
|
|
|
|
|
492,427,105
|
|
|
4,924,271
|
|
|
31,095,370
|
|
|
36,019,641
|
8. Dividends
No dividend has been declared or paid by the Company during the
six months ended 30 June 2015 (2014:
nil).
9. Earnings per share
The calculation of the basic loss per share of 0.235 pence for the 6 months ended 30 June 2015 (30 June
2014 loss per share: 0.076
pence) is based on the loss attributable to the equity
holders of the Company of £ (1,159,181) for the six month period
ended 30 June 2015 (30 June 2014: £304,054) divided by the weighted
average number of shares in issue during the period of 492,427,105
(weighted average number of shares for the 6 months ended
30 June 2014: 401,139,497).
The calculation of the basic loss per share of 0.041 pence for the 3 months ended 30 June 2015 (30 June
2014 loss per share: 0.098
pence) is based on the loss attributable to the equity
holders of the Company of £ (203,146) for the three month period
ended 30 June 2015 (3 months ended
30 June 2014: £ 392,092) divided by
the weighted average number of shares in issue during the period of
492,427,105 (weighted average number of shares for the 3 months
ended 30 June 2014: 401,139,497).
The basic and diluted loss per share is the same, as the effect
of the exercise of share options would be to decrease the loss per
share.
Details of share options that could potentially dilute earnings
per share in future periods are disclosed in the notes to the
Group's Annual Report and Financial Statements for the year ended
31 December 2014 and in note 10
below.
10. Issue of Share Options
On 10 June 2015, the Company
awarded 13,250,000 share options to Directors and senior
management. All of the share options have an exercise price of
4.00 pence. One third of the options
are exercisable from 10 December
2015, one third from 10 June
2016 and one third from 10 December
2016.
11. Ultimate controlling party
The Directors believe there to be no ultimate controlling
party.
12. Related party transactions
The nature of related party transactions of the Group has not
changed from those described in the Group's Annual Report and
Financial Statements for the year ended 31
December 2014.
13. Events after the reporting period
There were no reportable events after the balance sheet date
Approval of interim financial statements
The Condensed interim financial statements were approved by the
Board of Directors on 14 August
2015.
About Horizonte Minerals:
Horizonte Minerals plc is an AIM and TSX-listed nickel
development company focused in Brazil, which wholly owns the advanced
Araguaia nickel laterite project located to the south of the
Carajas mineral district of northern Brazil.
The Project is located in a mining district, which has good
infrastructure in place including rail, road, water and power, has
a current NI 43-101 compliant Mineral Resource of 71.98Mt grading
1.33% Ni (Indicated) and 25.4Mt at 1.21% Ni (Inferred) at a 0.95%
nickel cut-off; included in Resources is a Probable Reserve base of
21.2Mt at 1.66%Ni.
A Pre-Feasibility Study has been completed which underpins the
robust economics of developing a mine with a targeted 15,000tpa
nickel in ferro-nickel output with a 20% Fe-Ni product over a 25
year mine life utilising the proven pyrometallurgical process of
Rotary Kiln Electric Furnace technology. At these production
rates, the project has a post-tax NPV of US$519m at a discount rate of 8% and an IRR of
20%, with a capital cost of US$582m
which puts this project in the lowest quartile of the cost
curve.
Horizonte has a strong shareholder structure including Teck
Resources Limited 38.5%, Henderson Global Investors 14%, Anglo
Pacific Group 7%.
CAUTIONARY STATEMENT REGARDING FORWARD
LOOKING INFORMATION
Except for statements of historical fact relating to the
Company, certain information contained in this press release
constitutes "forward-looking information" under Canadian securities
legislation. Forward-looking information includes, but is not
limited to, statements with respect to the potential of the
Company's current or future property mineral projects; the success
of exploration and mining activities; cost and timing of future
exploration, production and development; the estimation of mineral
resources and reserves and the ability of the Company to achieve
its goals in respect of growing its mineral resources; and the
realization of mineral resource and reserve estimates. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "would",
"might" or "will be taken", "occur" or "be achieved".
Forward-looking information is based on the reasonable assumptions,
estimates, analysis and opinions of management made in light of its
experience and its perception of trends, current conditions and
expected developments, as well as other factors that management
believes to be relevant and reasonable in the circumstances at the
date that such statements are made, and are inherently subject to
known and unknown risks, uncertainties and other factors that may
cause the actual results, level of activity, performance or
achievements of the Company to be materially different from those
expressed or implied by such forward-looking information, including
but not limited to risks related to: exploration and mining risks,
competition from competitors with greater capital; the Company's
lack of experience with respect to development-stage mining
operations; fluctuations in metal prices; uninsured risks;
environmental and other regulatory requirements; exploration,
mining and other licences; the Company's future payment
obligations; potential disputes with respect to the Company's title
to, and the area of, its mining concessions; the Company's
dependence on its ability to obtain sufficient financing in the
future; the Company's dependence on its relationships with third
parties; the Company's joint ventures; the potential of currency
fluctuations and political or economic instability in
countries in which the Company operates; currency exchange
fluctuations; the Company's ability to manage its growth
effectively; the trading market for the ordinary shares of the
Company; uncertainty with respect to the Company's plans to
continue to develop its operations and new projects; the Company's
dependence on key personnel; possible conflicts of interest of
directors and officers of the Company, and various risks associated
with the legal and regulatory framework within which the Company
operates.
Although management of the Company has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking information,
there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that
such statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in
such statements.
SOURCE Horizonte Minerals plc