Goldplat plc (LON:GDP) Chief Executive Officer Gerard Kisbey-Green caught up with DirectorsTalk for an exclusive interview to discuss the highlights of interim results; both financial and operational, progress on the Rand Refinery & the open-pit discussions, the significance of the gold license renewal in Ghana and the cost & funding of the Kilimapesa project and Ghanaian elution plant
Q1: Now Gerard, Goldplat plc has produced a strong set of interim results, what are the highlights, in your opinion?
A1: Yes, I think without a doubt, the highlight of the period has been the progress at our Kilimapesa gold mine in Kenya where, during the period, we installed the first stage of the new gold processing plant and we commissioned this stage a couple of weeks ago, in February. In Ghana, the highlight was probably the successful renewal of our gold license and in South Africa, probably the progress made both on the Rand Refinery dispute as well as progress on securing the disused open pit for use as a final tailings deposition facility which we’ve reported on before.
Q2: Can you talk us through the financial and operational highlights?
A2: On an operating level, we made just over £1 million, in fact £1,009,000, that’s up well in excess of 300% when compared to the same period in FY2016 at £245,000, it compares very well in fact to the full year figure for 2016 which was £1,172,000. This came from an increase in revenues which were at £14 million for the period and that compares to £10 million in the same period in the previous financial year. Production was up at all of our units, 21,000 ounces in total compared to 17,500 ounces in the previous year.
So, all in all, very good numbers, I think the only number that was disappointing was the gold sold, transferred from Ghana, we had increased production in Ghana but we sold less because we had kept a significant material behind pending the reissuance of our gold license.
Q3: What progress has been made on the key issues in South Africa, the Rand Refinery dispute and securing the nearby disused open-pit for final tailings deposition at Goldplat Recovery?
A3: As previously announced, with the Rand Refinery dispute, both parties, Rand Refinery and Goldplat jointly appointed an independent expert to review the contract and come up with their findings. This was completed during the period and a report has been submitted to the two parties and we believe that the report supports our contention that we executed the contract successfully. So, we continue to expect recovery of the monies owed to us. We are in discussions with the Rand Refinery and we hope to bring this dispute to conclusion in the foreseeable future.
Just moving on to the second part of your question, the open-pit discussions, now there have been a lot of parties involved in this particular open-pit and we’ve finally go to a point where all parties have agreed that sterilisation of the pit is in everyone’s best interests. So, we’re now waiting a directive from the Department of Mineral Resources and then we’ll get into the paperwork of permitting and environmental etc. so we can start depositing in this pit which will be fantastic for us.
Q4: Now, you announced in December that your gold license in Ghana had been renewed, what was the significance of this and for how long is this license valid?
A4: So, the license is a standard three-year licence, the significance really was for Goldplat, albeit that the delays in the reissuance wasn’t from our side, it was purely administrative from the government side and then we ran into the election period but we were very loathed to export material whilst we didn’t have a valid license, for obvious reasons. So, albeit our production in Ghana was up nicely for the period we exported less material so it translates into less sales for Ghana. I’m pleased to report that immediately on the issuant of the license late December, we began the exporting, all of that material was exported in January.
Q5: That leads me on to my final question then, how much has the Kilimapesa project cost, how much will the installation of the Ghanaian elution plant cost and how will it all to be funded?
A5: The Kilimapesa project in total, we expect, will amount to in order of about $2 million when it’s all done. We have, as the market is aware, we’ve been funding within the group, primarily from Gold Recovery Limited & we do continue looking for efficient and acceptable alternative sources of debt capital to enable repayment of goods and services to Group subsidiary companies and indeed to restructure the Group balance sheet.
The Ghanaian elution plant, Goldplat are in the process of costing that but we expect that also, coincidently, to cost in the region of $2 million. Again, we’ve not yet decided how to fund this, obviously to the extent that we can, it will be internal funded, ideally within Ghana but we’ll take a view again on the viability of funding through the various capital markets at our disposal.