UNAUDITED INTERIM RESULTS
for the six months ended 30th June 2020
Griffin Mining Limited (“Griffin” or “the Company”) has today released its unaudited results for the six months ended 30th June 2020.
- Revenues of $21.3 million (30th June 2019 – $38.6 million)
- Gross Profit of $4.2 million (30th June 2019 – $15.9 million)
- Profit (Loss) before tax of ($3.0 million) (30th June 2019 – Profit $6.3 million)
- Profit (Loss) after tax of ($3.8 million) (30th June 2019 – Profit $4.1 million)
- Profit (Loss) per share of (2.22 cents) (30th June 2019 – Basic earnings per share 2.36 cents)
Financial and Trading:
The first six months of 2020 were impacted by the suspension in operations at Caijiaying imposed by the Chinese authorities for a month in late January / February and subsequent travel restrictions with consequent difficulties in returning mining personnel to Caijiaying resulting in reduced stoping and delayed development work. Tonnes mined were down 23.4% in the first six months of 2020 compared with that achieved in the first six months of 2019 with a knock on effect on ore hauled and processed, with tonnes of ore processed down 25.2% on that achieved in the first six months of 2019. Profitability was further impacted by lower zinc prices received which were 18.0% less than that realised in the first six months of 2019. As a result of the foregoing, zinc metal in concentrate sales were down $10,151,000 on that recorded in the first six months of 2019 directly impacting profits. Gold production was also impacted by the suspension in operations and delays in accessing higher grade gold ore bodies.
In the six months to 30th June 2020, 323,536 tonnes (30th June 2019 – 432,592 tonnes) of ore were processed to produce:
- 13,448 tonnes of zinc (30th June 2019 – 16,692 tonnes);
- 631 tonnes of lead (30th June 2019 – 494 tonnes);
- 110,832 ounces of silver (30th June 2019 – 141,306 ounces); and
- 2,418 ounces of gold (30th June 2019 – 9,099 ounces).
Zinc revenues before royalties and resource taxes in the six months to 30th June 2020 were $17,008,000 (30th June 2019 – $27,159,000) with 13,046 tonnes of zinc metal in concentrate sold (30th June 2019 – 17,072 tonnes). Lead and precious metals revenues were $5,279,000 (30th June 2019 – $13,036,000) with less gold in concentrate sold.
During the six months to 30th June 2020:
- 314,690 tonnes of ore were mined (30th June 2019 – 410,819 tonnes);
- 321,514 tonnes of ore were hauled (30th June 2019 – 426,070 tonnes); and
- 323,536 tonnes of ore were processed (30th June 2019 – 432,592 tonnes).
Costs of sales (mining, haulage and processing costs) of $17,153,000 in the first six months of 2020 were down 24.3% on that incurred in the six months to 30th June 2019 of $23,336,000. This reflects reduced activity during the suspension in operations and subsequent travel restrictions imposed by the Chinese authorities, together with consequent cost control by management.
Net operating expenses (including those of the Caijiaying site) fell 27.6% from $9,955,000 in the first six months of 2019 to $7,204,000 in 2020. This includes fees to the Group’s Chinese partners of $831,000 (2019 $1,820,000), equivalent to their minimum equity interest in Hebei Hua Ao’s profits. Again the reduction in other operating expenses reflects reduced activity and cost control by management.
Losses per share were 2.22 cents (30th June 2019: Basic earnings 2.36 cents). At 30th June 2020, attributable net assets per share amounted to 121 cents (30th June 2019: 124 cents).
Cash flows from operations in the period have been directed at paying down outstanding creditors and further development of the Caijiaying Mine.
Chairman Mladen Ninkov commented, “On first glance, the first 6 month’s results seem disappointing but a closer inspection reveals a solid result in the face of the COVID-19 shutdown in operations, the subsequent restrictions imposed by all relevant governments on travel to and from China and the continuing low zinc prices and higher treatment charges. All of these issues resulted in, most importantly, reduced tonnes mined meaning less metal produced, particularly gold. A slow first half of any year is not unusual for Griffin and we expect a stronger and more robust performance in the second half of 2020 as we return to a normal operating environment. It is superfluous to add, we eagerly await the issue of our new mining licence.”
Griffin Mining Limited
Mladen Ninkov – Chairman Telephone: +44(0)20 7629 7772
Roger Goodwin – Finance Director
Numis Securities Limited
Paul Gillam Telephone: +44(0)20 7260 1000
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