Goldplat plc (“Goldplat”), the AIM-quoted gold producer, with international gold recovery operations located in South Africa and Ghana.
Werner Klingenberg, CEO of Goldplat commented: “The current financial period for Goldplat has not just been a year of turnaround performance in its continuing operations, but also a transitional period, with a renewed focus on key initiatives in its recovery operations, whilst moving away from mining.
The strong performance in the recovery operations reinforced our decision to divest from our exploration and mining portfolio. The discontinuing of our exploration and mining segment gave us the opportunity to impair Group assets to provide a clear view of the financial position of our continuing operations. The increase in the supply of material during the period and the strengthening of our customer base, supported by the higher gold prices, has provided us with a good platform to drive our strategic initiatives during the next period and to return value to shareholders again.”
Progress has been made on the transaction with a draft restructuring plan and due diligence information received from Mayflower and we are working closely with them in advancing the transaction and finalising the due diligence, which will only be completed once the restructuring plan has been concluded. Further to the Company’s announcement of 15 October 2020, it has been agreed that all conditions have been met or waived and the exclusivity period for the sale of Kilimapesa be extended to 31 December 2020. Further updates will be provided on the transaction in due course.
I am pleased to introduce strong and much-improved Group operational results for the year ended 30 June 2020 and to advise shareholders of significant progress in the Group’s development towards sustainable profitability from our two precious metal recovery facilities in South Africa and Ghana.
Profit for the year from continuing operations was £5,666,000 before taxation (Restated 2019: £1,017,000) and
£3,305,000 after taxation (Restated 2019: £305,000) and net current assets at 30 June 2020 stood at £5,216,000 (Restated 2019: £3,577,000) including cash of £3,141,000 (2019: £2,367,000).
Whilst the gold price has clearly been a strong contributor to these results, that is far from being the whole story behind this year’s operational success. The efforts that Goldplat’s highly skilled team has been putting in to improving operational efficiency, developing new processes, widening the types of material we can profitably accommodate and developing our customer base are all contributing to these results, and should stand us in good stead irrespective of the gold price.
This year’s results reflect the accounting adjustments arising from discontinued operations, being principally the Kilimapesa gold mine in Kenya. The conditional agreement we announced on 31 July 2020 for the sale of Kilimapesa, once completed, provides for Goldplat to have an equity interest in the prospective acquirer without being required to provide further finance or management time. Goldplat’s management can then fully concentrate on the precious metal recovery businesses which have always been the source of the Group’s profitability and positive cash flows.
We also still have work to do to ensure that the strong operational results convert into sustainable returns to shareholders. Aside from the one-off accounting loss arising from discontinued operations, the Group’s results continue to be affected by a high effective tax rate (this year 42% of profit from continuing operating activities (2019: 72%) and the effects of foreign exchange rates fluctuating across the four currencies in which we operate and sterling in which we present our results. We are looking at ways of simplifying the group structure to help address these issues so that we may realise our ambition of distributing cash surplus to the Group’s operational requirements and growth plans to shareholders.
On 14 May 2020, I was pleased to announce the appointment of Gerard Kisbey-Green as a non-executive director, following dialogue with a substantial shareholder of the Company. Gerard had previously served as an Executive Director from 2014 until his resignation in 2019. He has extensive experience of the Group and its stakeholders and has much to contribute to the Group’s development. Notwithstanding the travel restrictions and dislocation which the current pandemic has brought on, I believe that your Board of Directors has continued to function effectively over the period, meeting with the usual regularity (using teleconferencing where necessary) and receiving reports on all the Group’s multi-national operations in the normal manner.
The pandemic also brought on new challenges to operating our facilities in South Africa and Ghana in a safe way for all our employees and local communities. The relevant regulatory authorities have been helpful and active in assisting businesses such as ours to meet these challenges, for which we are most appreciative. Operations in South Africa halted for approximately a month, in the circumstances not a long period, and I am pleased to report that both operations returned to near full production and near full employment within a matter of weeks. In addition to addressing the challenges of the pandemic, our performance in respect of our on-going health, safety and environmental obligations has continued to be strong.
My profound thanks to all Goldplat’s employees in South Africa, Ghana, South America and Kenya for the ways in which they have risen to the current challenges, as well as to my fellow board members and Goldplat’s advisors for their contributions. We look forward with optimism.
Matthew Seymour Robinson
30 November 2020
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