Altus Strategies: Final Results

29th April 2022 | Altus Strategies PLC

Audited Final Results

Altus Strategies Plc (AIM: ALS, TSX-V: ALTS, OTCQX: ALTUF) announces its audited final results for the year ended 31 December 2021. These are presented below and are available (along with the Company’s 2021 Annual Report) to download on the Company’s website at http://altus-strategies.com/investors/financials/ and on SEDAR at www.sedar.com.

Corporate highlights

  • Acquisition of an effective 0.418% Net Smelter Return (“NSR”) royalty on the Caserones copper mine (“Caserones”) in northern Chile for US$34.1m
  • Caserones royalty acquired via a strategic 50:50 partnership with NYSE-American and TSX-V listed EMX Royalty Corp (“EMX”) through a Chilean special purpose vehicle (“SPV”)
  • Receipt of maiden royalty income of £1.7m (before tax) in respect of Q2 and Q3 2021 production at Caserones
  • Acquisition of 24 royalty interests from Newcrest Mining Ltd (“Newcrest”) for US$24.0m, including royalties on two producing gold mines, one near-producing gold mine and 21 development and exploration stage projects (23 of which are located in Australia and one in Côte d’Ivoire)
  • Newcrest royalties acquisition undertaken through a strategic joint venture with private company AlphaStream Limited (“AlphaStream”) through SPVs in United Arab Emirates and Australia; first close of the acquisition covering all assets except nine development and exploration stage assets for US$20.0m
  • US$29 million strategic acquisition loan facility provided by the Company’s largest shareholder La Mancha Fund SCSp (“La Mancha”)
  • Moroccan portfolio of 14 primarily silver and copper projects to be vended to Eastinco Mining and Exploration Plc (“Eastinco”) subject to Eastinco listing on the Standard List of the London Stock Exchange; Altus to retain NSR royalty rights on all projects, to gain a royalty right on Musasa tantalum mine in Rwanda and to become a major shareholder of Eastinco
  • Appointments to the senior management team strengthen the Company’s corporate and technical capabilities across its key areas of operation:
    • Mark Campbell appointed as Non-Executive Chairman of 100% owned subsidiary Akh Gold Holdings Ltd and General Manager (Egypt)
    • Amilha Young appointed as Company Secretary and Legal Counsel
    • Boubacar Thera appointed as Corporate Manager (Mali)
    • David Hall appointed as Strategic Advisor (Egypt)

Operational highlights

  • Expansion of activities into Egypt through award of gold exploration licences, forming four projects, totalling 1,565km2 located in the Eastern Desert through a competitive international bidding process; discovery of numerous hard rock artisanal gold workings from field reconnaissance at Gabal Om Ourada and Wadi Dubur projects
  • Western Mali: High grade intersections including 21.9 grams per tonne (“g/t”) gold (“Au”) over 10.2m from 28m from diamond drilling (“DD”) at Diba gold deposit in western Mali (results are down-the-hole and not true widths)
  • Southern Mali: Gold resource exceeds one million ounces (17.3 million tonnes at 1.2 g/t Au for 665,000 inferred ounces and 9.2 million tonnes at 1.2 g/t Au for 360,000 indicated ounces) at Tabakorole gold project in Southern Mali under Joint Venture (“JV”) with Australian Securities Exchange (“ASX”) listed Marvel Gold Ltd (“Marvel Gold”) (see Altus’ news release “Gold Resource Exceeds One Million Ounces at Tabakorole in Southern Mali” dated 5 October 2021). Upgraded Mineral Resource Estimate (“MRE”) generated a 24% increase in indicated ounces and 7% increase in inferred ounces, with 70% of deposit comprising the MRE within 150m of the surface; encouraging DD results and discovery of a potential new parallel zone of mineralisation; significant increase in JV landholding at Tabakorole (by 100km2 to 292km2)
  • Morocco: Grant of 10 new exploration licences taking the Company’s portfolio to 14 projects covering 824km2 targeting primarily copper and silver; discovery of high-grade copper and silver from reconnaissance exploration at the newly granted Azrar, Izougza and Tata projects
  • Completion of strategic review of Bikoula iron project in southern Cameroon by Mining Plus UK Ltd (“Mining Plus”) to determine next steps for project development

Financial highlights

  • Completion in March 2021 of oversubscribed fundraising for £7.7m / C$13.4m at an issue price of £0.75 / C$1.30 per Ordinary Share with net proceeds primarily used to accelerate gold exploration programmes in Egypt and Mali
  • Receipt of second tranche of 10 million shares in Canyon Resources Ltd (“Canyon”) with a value at the time of £0.6m / C$1.1m
  • Completion in December 2021 of oversubscribed fundraising for £19.8m / C$33.7m at an issue price of £0.535 / C$0.90 per Ordinary Share with net proceeds primarily used for completion of the Newcrest royalty acquisition
  • Cash balance of £6.4m / C$10.9m as at 31 December 2021
  • Cash outflow from operating activities of £7.9m / C$13.4m for the year
  • Listed equity holdings of £1.7m / C$2.9m as at 31 December 2021

Post-period end

  • Second and final close of the Newcrest royalties acquisition covering nine development and exploration stage assets located in Australia for consideration of US$4.0m
  • Completion of 11,832m drilling programme at Diba and Lakanfla gold project with latest results of up to 1.27 g/t Au over 127m from 21m on the Lakanfla Central prospect and 1.81 g/t Au over 10m from 256m at the Diba NW prospect (results are down-the-hole and not true widths)
  • Extension of La Mancha loan facility to 30 June 2022 with annualised interest rate increased to 10% plus the United States Dollar (“USD”) London Inter-bank Offered Rate (“LIBOR”)
  • 1.0% Gross Revenue Royalty (“GRR”) generated on Toura Nickel-Cobalt project in Côte d’Ivoire through sale of interest in local subsidiary to Firering Strategic Minerals Plc (“Firering”) for €15,000
  • Revised joint venture agreement signed with Marvel Gold whereby the Company regained a 100% interest in the Lakanfla licence in western Mali, located 5km east of the Company’s Diba project, and reduced its interest in the Tabakorole gold project in southern Mali to 30%; Altus retains a 2.5% NSR royalty on the Tabakorole project
  • Award of a ten year (renewable) mining licence at the Agdz project in central Morocco covering an area of 34.36km2, representing the area of copper and silver mineralisation discovered to date
  • Award of a four year (renewable) ‘small scale’ mining licence at the Diba gold project in western Mali covering an area of 83.1km2, incorporating the Diba Deposit and other key prospects

Steven Poulton, Chief Executive of Altus, commented:

“2021 marked another milestone year for Altus. With the acquisition of an NSR royalty on the Caserones copper mine in Chile and receipt of the maiden royalty payment just a month after closing the deal transformed Altus into a revenue generating business. Later in the year, we acquired a portfolio of 24 royalty interests from Newcrest Mining Ltd. The Newcrest portfolio includes royalties on two producing gold mines, one near-producing gold mine and 21 development and exploration stage projects, bringing the Company’s global portfolio to 33 royalty interests and 27 project interests across nine countries and nine metals.

“Operationally, our focus during the period was on advancing and de-risking our royalty generation assets, primarily in Mali and Egypt. In southern Mali, an updated independent Mineral Resource Estimate at the Tabakorole gold royalty and JV project reported that gold resources now exceed one million ounces and there remains significant potential for further growth in parallel zones, along strike and at depth. Elsewhere in western Mali, diamond drilling we completed at the Company’s 100% owned Diba gold project returned impressive high-grade intersections and discovered new zones. Earlier this month, post-period, Altus was granted a small-scale gold mining licence for Diba; an important step as we now progress with an updated MRE and Preliminary Economic Assessment for the combined Diba & Lakanfla project. In Egypt, Altus was awarded highly prospective gold exploration licences totalling 1,565km2 in the Eastern Desert, which we consider has world class discovery potential. Systematic exploration and target evaluation is already underway across these projects.

“Altus is exceptionally well-positioned to progress with its royalty generation activities across Africa while also reviewing accretive royalty income acquisition opportunities. The Company has a strong pipeline of transactions under review and we intend to further enhance and diversify our portfolio in the coming years growing our revenue streams in parallel.

“2022 is on course to be another highly productive year for the Company and we look forward to providing further updates in due course.”

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