Caledonia Mining Corp Plc 6-K/A, filed Sep 3, 2020
Caledonia Mining Corp Plc (CMCL)
About this 6-K/A
Caledonia Mining Corp Plc filed this 6-K/A on September 3, 2020.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K/A
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
Of the Securities Exchange Act of 1934
For the month of September 2020
Commission File Number: 001-38164
CALEDONIA MINING CORPORATION PLC
(Translation of registrant's name into English)
B006 Millais House
Castle Quay
St Helier
Jersey JE2 3EF
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F
Form 20-F X Form 40-F ______
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ______
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ______
EXPLANATORY NOTE
The sole purpose of this amendment to Form 6-K, originally filed with the Securities and Exchange Commission on August 13, 2020, is to furnish Exhibit 99.1 to the Form 6-K in the form containing the XBRL (eXtensible Business Reporting Language) Interactive Data File for the financial statements and notes included therein.
No other changes have been made to the Form 6-K and the Form 6-K has not been updated to reflect events occurring subsequent to the original filing date.
Exhibit 99.1 included with this report on Form 6-K/A is expressly incorporated by reference into this report and is hereby incorporated by reference as an exhibit to the Registration Statement on Form F-3 of Caledonia Mining Corporation Plc (File No. 333-224784), as amended or supplemented.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CALEDONIA MINING CORPORATION PLC | |||
| (Registrant) | |||
| By: | /s/ Steven Roy Curtis | ||
| Dated: September 3, 2020 |
Name: |
Steven Roy Curtis | |
| Title: | Chief Executive Officer |
||
Exhibit Index
| Exhibit | Description |
| 99.1 | Interim Financial Statements/Report |
| 101.INS | XBRL Instance Document |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
Exhibit 99.1
Caledonia Mining Corporation Plc
| MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL INFORMATION |
To the Shareholders of Caledonia Mining Corporation Plc:
Management has prepared the information and representations in this interim report. The unaudited condensed consolidated interim financial statements of Caledonia Mining Corporation Plc and its subsidiaries (the “Group”) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and, where appropriate, these statements include some amounts that are based on best estimates and judgment. Management has determined such amounts on a reasonable basis in order to ensure that the unaudited condensed consolidated interim financial statements are presented fairly, in all material respects.
The accompanying Management Discussion and Analysis (“MD&) also includes information regarding the impact of current transactions, sources of liquidity, capital resources, operating trends, risks and uncertainties. Actual results in the future may differ materially from our present assessment of this information because future events and circumstances may not occur as expected.
The Group maintains adequate systems of internal accounting and administrative controls, within reasonable cost. Such systems are designed to provide reasonable assurance that relevant and reliable financial information are produced.
Management is responsible for establishing and maintaining adequate internal controls over financial reporting (“ICFR”). Any system of ICFR, no matter how well designed, has inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.
At June 30, 2020 management evaluated the effectiveness of the Group’s ICFR and concluded that such ICFR was effective.
The Board of Directors, through its Audit Committee, is responsible for ensuring that management fulfils its responsibilities for financial reporting and internal control. The Audit Committee is composed of three independent directors. This Committee meets periodically with management and the external auditor to review accounting, auditing, internal control and financial reporting matters.
These condensed consolidated interim financial statements have not been audited by the Group’s auditor.
The unaudited condensed consolidated interim financial statements for the period ended June 30, 2020 were approved by the Board of Directors and signed on its behalf on August 13, 2020.
| (Signed) S. R. Curtis | (Signed) J.M. Learmonth | |
| Chief Executive Officer | Chief Financial Officer |
1
Caledonia Mining Corporation Plc
Condensed consolidated statements of profit or loss and other comprehensive income
(in thousands of United States dollars, unless indicated otherwise)
| For the 3 months ended June 30 | For the 6 months ended June 30 | |||||||||||||||||||
| Unaudited | Note | 2020 | 2019 | 2020 | 2019 | |||||||||||||||
| Revenue | 22,913 | 16,520 | 46,515 | 32,440 | ||||||||||||||||
| Less: Royalties | (1,146 | ) | (864 | ) | (2,328 | ) | (1,683 | ) | ||||||||||||
| Production costs | 6 | (11,451 | ) | (7,571 | ) | (22,138 | ) | (17,340 | ) | |||||||||||
| Depreciation | (1,141 | ) | (1,052 | ) | (2,314 | ) | (2,100 | ) | ||||||||||||
| Gross profit | 9,175 | 7,033 | 19,735 | 11,317 | ||||||||||||||||
| Other income | 7 | 2,791 | 749 | 4,709 | 2,038 | |||||||||||||||
| Other expenses | 8 | (1,314 | ) | (220 | ) | (1,522 | ) | (309 | ) | |||||||||||
| Administrative expenses | 9 | (1,275 | ) | (1,309 | ) | (2,822 | ) | (2,705 | ) | |||||||||||
| Cash-settled share-based expense | 10 | (762 | ) | (9 | ) | (946 | ) | (370 | ) | |||||||||||
| Net foreign exchange gain | 11 | 1,486 | 21,645 | 3,709 | 24,925 | |||||||||||||||
| Profit on sale of subsidiary | - | - | - | 5,409 | ||||||||||||||||
| Fair value losses on derivative assets | 15 | (113 | ) | (194 | ) | (148 | ) | (324 | ) | |||||||||||
| Operating profit | 9,988 | 27,695 | 22,715 | 39,981 | ||||||||||||||||
| Finance income | 18 | 44 | 32 | 50 | ||||||||||||||||
| Finance cost | (147 | ) | (16 | ) | (299 | ) | (70 | ) | ||||||||||||
| Profit before tax | 9,859 | 27,723 | 22,448 | 39,961 | ||||||||||||||||
| Tax expense | (3,507 | ) | 223 | (6,417 | ) | (1,296 | ) | |||||||||||||
| Profit for the period | 6,352 | 27,946 | 16,031 | 38,665 | ||||||||||||||||
| Other comprehensive income | ||||||||||||||||||||
| Items that are or may be reclassified to profit or loss | ||||||||||||||||||||
| Exchange differences on translation of foreign operations | 293 | 144 | (1,058 | ) | - | |||||||||||||||
| Reclassification of accumulated exchange differences on the sale of subsidiary | - | - | - | (2,109 | ) | |||||||||||||||
| Total comprehensive income for the period | 6,645 | 28,090 | 14,973 | 36,556 | ||||||||||||||||
| Profit attributable to: | ||||||||||||||||||||
| Owners of the Company | 5,134 | 23,303 | 13,374 | 32,621 | ||||||||||||||||
| Non-controlling interests | 1,218 | 4,643 | 2,657 | 6,044 | ||||||||||||||||
| Profit for the period | 6,352 | 27,946 | 16,031 | 38,665 | ||||||||||||||||
| Total comprehensive income attributable to: | ||||||||||||||||||||
| Owners of the Company | 5,427 | 23,447 | 12,316 | 30,512 | ||||||||||||||||
| Non-controlling interests | 1,218 | 4,643 | 2,657 | 6,044 | ||||||||||||||||
| Total comprehensive income for the period | 6,645 | 28,090 | 14,973 | 36,556 | ||||||||||||||||
| Earnings per share | ||||||||||||||||||||
| Basic earnings per share ($) | 0.43 | 2.11 | 1.14 | 2.99 | ||||||||||||||||
| Diluted earnings per share ($) | 0.43 | 2.11 | 1.14 | 2.99 | ||||||||||||||||
The accompanying notes on page 6 to 21 are an integral part of these condensed consolidated interim financial statements.
On behalf of the Board: “S.R. Curtis”- Chief Executive Officer and “J.M. Learmonth”- Chief Financial Officer.
2
Caledonia Mining Corporation Plc
Condensed consolidated statements of financial position
(in thousands of United States dollars, unless indicated otherwise)
| Unaudited | June 30, | December 31, | ||||||||||
| As at | Note | 2020 | 2019 | |||||||||
| Assets | ||||||||||||
| Property, plant and equipment | 12 | 119,410 | 113,651 | |||||||||
| Deferred tax asset | 96 | 63 | ||||||||||
| Total non-current assets | 119,506 | 113,714 | ||||||||||
| Inventories | 13 | 12,010 | 11,092 | |||||||||
| Prepayments | 2,915 | 2,350 | ||||||||||
| Trade and other receivables | 14 | 7,170 | 6,912 | |||||||||
| Derivative financial assets | 15 | 1,112 | 102 | |||||||||
| Cash and cash equivalents | 11,639 | 9,383 | ||||||||||
| Total current assets | 34,846 | 29,839 | ||||||||||
| Total assets | 154,352 | 143,553 | ||||||||||
| Equity and liabilities | ||||||||||||
| Share capital | 62,158 | 56,065 | ||||||||||
| Reserves | 137,425 | 140,730 | ||||||||||
| Retained loss | (76,687 | ) | (88,380 | ) | ||||||||
| Equity attributable to shareholders | 122,896 | 108,415 | ||||||||||
| Non-controlling interests | 15,059 | 16,302 | ||||||||||
| Total equity | 137,955 | 124,717 | ||||||||||
| Liabilities | ||||||||||||
| Provisions | 3,384 | 3,346 | ||||||||||
| Deferred tax liability | 1,457 | 3,129 | ||||||||||
| Term loan facility – long term portion | 263 | 1,942 | ||||||||||
| Cash-settled share-based payments – long term portion | 1,384 | 540 | ||||||||||
| Total non-current liabilities | 6,488 | 8,957 | ||||||||||
| Term loan facility – short term portion | 458 | 529 | ||||||||||
| Cash-settled share-based payments – short term portion | 73 | - | ||||||||||
| Income tax payable | 1,267 | 163 | ||||||||||
| Trade and other payables | 8,111 | 8,697 | ||||||||||
| Overdraft | - | 490 | ||||||||||
| Total current liabilities | 9,909 | 9,879 | ||||||||||
| Total liabilities | 16,397 | 18,836 | ||||||||||
| Total equity and liabilities | 154,352 | 143,553 |
The accompanying notes on pages 6 to 21 are an integral part of these condensed consolidated interim financial statements.
3
Caledonia Mining Corporation Plc
Condensed consolidated statements of changes in equity
(in thousands of United States dollars, unless indicated otherwise)
Unaudited
Notes | Share Capital | Foreign Currency Translation Reserve | Contributed Surplus |
Equity-settled share-based Payment Reserve | Retained loss | Total | Non-controlling interests (NCI) | Total Equity | ||||||||||||||||||||||||||||
| Balance at December 31, 2018 | 55,102 | (6,561 | ) | 132,591 | 16,760 | (127,429 | ) | 70,463 | 8,345 | 78,808 | ||||||||||||||||||||||||||
| Transactions with owners: | ||||||||||||||||||||||||||||||||||||
| Dividends paid | - | - | - | - | (1,478 | ) | (1,478 | ) | (142 | ) | (1,620 | ) | ||||||||||||||||||||||||
| Shares issued – share based payment | 10(a) | 963 | - | - | - | - | 963 | - | 963 | |||||||||||||||||||||||||||
| Total comprehensive income: | ||||||||||||||||||||||||||||||||||||
| Profit for the period | - | - | - | - | 32,621 | 32,621 | 6,044 | 38,665 | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | - | (2,109 | ) | - | - | - | (2,109 | ) | - | (2,109 | ) | |||||||||||||||||||||||||
| Balance at June 30, 2019 | 56,065 | (8,670 | ) | 132,591 | 16,760 | (96,286 | ) | 100,460 | 14,247 | 114,707 | ||||||||||||||||||||||||||
| Balance at December 31, 2019 | 56,065 | (8,621 | ) | 132,591 | 16,760 | (88,380 | ) | 108,415 | 16,302 | 124,717 | ||||||||||||||||||||||||||
| Transactions with owners: | ||||||||||||||||||||||||||||||||||||
| Dividend paid | - | - | - | - | (1,681 | ) | (1,681 | ) | (300 | ) | (1,981 | ) | ||||||||||||||||||||||||
| Shares issued – share-based payment | 10(a) | 216 | - | - | - | - | 216 | - | 216 | |||||||||||||||||||||||||||
| Shares issued – option exercises | 30 | - | - | - | - | 30 | - | 30 | ||||||||||||||||||||||||||||
| Blanket shares repurchased by shares issued | 5 | 5,847 | - | - | (2,247 | ) | - | 3,600 | (3,600 | ) | - | |||||||||||||||||||||||||
| Total comprehensive income: | ||||||||||||||||||||||||||||||||||||
| Profit for the period | - | - | - | - | 13,374 | 13,374 | 2,657 | 16,031 | ||||||||||||||||||||||||||||
| Other comprehensive income for the period | - | (1,058 | ) | - | - | - | (1,058 | ) | - | (1,058 | ) | |||||||||||||||||||||||||
| Balance at June 30, 2020 | 62,158 | (9,679 | ) | 132,591 | 14,513 | (76,687 | ) | 122,896 | 15,059 | 137,955 |
The accompanying notes on page 6 to 21 are an integral part of these condensed consolidated interim financial statements.
4
Caledonia Mining Corporation Plc
Condensed consolidated statements of cash flows
(In thousands of United States dollars, unless indicated otherwise)
Unaudited
| For the 3 months ended June 30 | For the 6 months ended June 30 | |||||||||||||||||||
| Note | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||
| Cash generated by operations | 16 | 5,413 | 2,484 | 16,371 | 9,117 | |||||||||||||||
| Net interest paid | (123 | ) | 16 | (263 | ) | (96 | ) | |||||||||||||
| Tax paid | (1,315 | ) | (362 | ) | (2,034 | ) | (608 | ) | ||||||||||||
| Net cash from operating activities | 3,975 | 2,138 | 14,074 | 8,413 | ||||||||||||||||
| Cash flows from investing activities | ||||||||||||||||||||
| Acquisition of property, plant and equipment | (3,228 | ) | (4,186 | ) | (7,921 | ) | (9,326 | ) | ||||||||||||
| Purchase of derivate financial asset | (1,058 | ) | - | (1,058 | ) | - | ||||||||||||||
| Proceeds on disposal of subsidiary | - | - | 900 | 1,000 | ||||||||||||||||
| Net cash used in investing activities | (4,286 | ) | (4,186 | ) | (8,079 | ) | (8,326 | ) | ||||||||||||
| Cash flows from financing activities | ||||||||||||||||||||
| Dividends paid | (1,012 | ) | (882 | ) | (1,981 | ) | (1,620 | ) | ||||||||||||
| Payment of lease liabilities | (32 | ) | - | (57 | ) | - | ||||||||||||||
| Proceeds from share option exercises | 30 | - | 30 | - | ||||||||||||||||
| Net cash used in financing activities | (1,014 | ) | (882 | ) | (2,008 | ) | (1,620 | ) | ||||||||||||
| Net (decrease)/ increase in cash and cash equivalents | (1,325 | ) | (2,930 | ) | 3,987 | (1,533 | ) | |||||||||||||
| Effect of exchange rate fluctuations on cash held | (861 | ) | 1,063 | (1,241 | ) | (1,779 | ) | |||||||||||||
| Net cash and cash equivalents at beginning of period | 13,825 | 9,742 | 8,893 | 11,187 | ||||||||||||||||
| Net cash and cash equivalents at end of period | 11,639 | 7,875 | 11,639 | 7,875 | ||||||||||||||||
The accompanying notes on page 6 to 21 are an integral part of these condensed consolidated interim financial statements.
5
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
1 Reporting entity
Caledonia Mining Corporation Plc (the “Company”) is a company domiciled in Jersey, Channel Islands. The address of the Company’s registered office is B006 Millais House, Castle Quay, St Helier, Jersey, Channel Islands. These unaudited condensed consolidated interim financial statements as at and for the 6 months ended June 30, 2020 comprise the Company and its subsidiaries (the “Group”). The Group is primarily involved in the operation of a gold mine and the exploration and development of mineral properties for precious metals.
Caledonia’s shares are listed on the NYSE American stock exchange (symbol - “CMCL”). Depository interests in Caledonia’s shares are admitted to trading on AIM of the London Stock Exchange plc (symbol - “CMCL”).
2 Basis for preparation
i) Statement of compliance
These unaudited condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting and do not include all the information required for full annual financial statements. Accordingly, certain information and disclosures normally included in the annual financial statements prepared in accordance with IFRS as issued by the IASB have been omitted or condensed. Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the financial position and performance of the Group since the last annual consolidated financial statements as at and for the year ended December 31, 2019
ii) Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis except for:
| · | cash-settled share-based payment arrangements measured at fair value on grant and re-measurement dates; and |
| · | derivative financial assets measured at fair value. |
iii) Functional currency
These unaudited condensed consolidated interim financial statements are presented in United States dollars (“$” or “US Dollar” or “USD”), which is also the functional currency of the Company. All financial information presented in United States dollars have been rounded to the nearest thousand, unless indicated otherwise. Refer to note 11 for changes to the RTGS$ currency and the effect thereof on the statement of profit or loss and other comprehensive income.
3 Use of accounting assumptions, estimates and judgements
In preparing these unaudited condensed consolidated interim financial statements, management has made accounting assumptions, estimates and judgements that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Changes in estimates are recognised prospectively.
6
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
4 Significant accounting policies
The same accounting policies and methods of computation have been applied consistently to all periods presented in these unaudited condensed consolidated interim financial statements as compared to the Group’s annual financial statements for the year ended December 31, 2019. In addition, the accounting policies have been applied consistently by the Group entities.
5 Blanket Zimbabwe Indigenisation Transaction
On February 20, 2012 the Group announced it had signed a Memorandum of Understanding (“MoU”) with the Minister of Youth, Development, Indigenisation and Empowerment of the Government of Zimbabwe pursuant to which the Group agreed that indigenous Zimbabweans would acquire an effective 51% ownership interest in the Zimbabwean company owning the Blanket Mine (also referred to herein as “Blanket” or “Blanket Mine” as the context requires) for a paid transactional value of $30.09 million. Pursuant to the above, members of the Group entered into agreements with each indigenous shareholder to transfer 51% of the Group’s ownership interest in Blanket Mine whereby it:
| · | sold a 16% interest to the National Indigenisation and Economic Empowerment Fund (“NIEEF”) for $11.74 million; |
| · | sold a 15% interest to Fremiro Investments (Private) Limited (“Fremiro”), which is owned by indigenous Zimbabweans, for $11.01 million; |
| · | sold a 10% interest to Blanket Employee Trust Services (Private) Limited (“BETS”) for the benefit of present and future managers and employees for $7.34 million. The shares in BETS are held by the Blanket Mine Employee Trust (“Employee Trust”) with Blanket Mine’s employees holding participation units in the Employee Trust; and |
| · | donated a 10% ownership interest to the Gwanda Community Share Ownership Trust (“Community Trust”). In addition, Blanket Mine paid a non-refundable donation of $1 million to the Community Trust. |
The Group facilitated the vendor funding of these transactions which is repaid by way of dividends from Blanket Mine. 80% of dividends declared by Blanket Mine are used to repay such loans and the remaining 20% unconditionally accrues to the respective indigenous shareholders. Following a modification to the interest rate on June 23, 2017, outstanding balances on these facilitation loans attract interest at a rate of the lower of a fixed 7.25% per annum payable quarterly or 80% of the Blanket Mine dividend in the quarter. The timing of the repayment of the loans depends on the future financial performance of Blanket Mine and the extent of future dividends declared by Blanket Mine. The facilitation loans relating to the Group were transferred as dividends in specie intra Group and now the loans and most of the interest thereon is payable to the Company.
7
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
5 Blanket Zimbabwe Indigenisation Transaction (continued)
Accounting treatment
The directors of Caledonia Holdings Zimbabwe (Private) Limited (“CHZ”), a wholly owned subsidiary of the Company, performed a re-assessment, using the requirements of IFRS 10: Consolidated Financial Statements (IFRS 10), and concluded that CHZ should continue to consolidate Blanket Mine after the indigenisation and accordingly the subscription agreements with the indigenous shareholders have been accounted for as a transaction with non-controlling interests and as a share based payment transaction.
The subscription agreements, concluded on February 20, 2012, were accounted for as follows:
| · | Non-controlling interests (“NCI”) were recognised on the portion of shareholding upon which dividends declared by Blanket Mine will accrue unconditionally to equity holders as follows: |
| (a) | 20% of the 16% shareholding of NIEEF; |
| (b) | 20% of the 15% shareholding of Fremiro; and |
| (c) | 100% of the 10% shareholding of the Community Trust. |
| · | This effectively means that NCI was recognised at 16.2% of the net assets of Blanket Mine, until the completion of the transaction with Fremiro whereby the NCI reduced to 13.2% (see below). | |
| · | The remaining 80% of the shareholding of NIEEF and Fremiro is recognised as non-controlling interests to the extent that their attributable share of the net asset value of Blanket Mine exceeds the balance on the facilitation loans including interest. At June 30, 2020 the attributable net asset value did not exceed the balance on the respective loan accounts and thus no additional NCI was recognised. | |
| · | The transaction with BETS is accounted for in accordance with IAS 19 Employee Benefits (profit sharing arrangement) as the ownership of the shares does not ultimately pass to the employees. The employees are entitled to participate in 20% of the dividends accruing to the 10% shareholding in Blanket Mine if they are employed at the date of such distribution. To the extent that 80% of the attributable dividends exceeds the balance on the BETS facilitation loan they will accrue to the employees at the date of such declaration. | |
| · | The Employee Trust and BETS are entities effectively controlled and consolidated by Blanket Mine. Accordingly, the shares held by BETS are effectively treated as treasury shares in Blanket Mine and no NCI is recognised. | |
Fremiro purchase agreement
On November 5, 2018 the Company and Fremiro entered into a sale agreement for Caledonia to purchase Fremiro’s 15% shareholding in Blanket Mine. On January 21, 2020 all substantive conditions to the transaction were satisfied and the Company issued 727,266 shares to Fremiro for the cancellation of their facilitation loan and purchase of Fremiro’s 15% shareholding in Blanket Mine. The transaction was accounted for as a repurchase of a previously vested equity instrument. As a result, the Fremiro share of the NCI of $3,600 was derecognised, shares were issued at fair value, the share based payment reserve was reduced by $2,247 and the Company’s shareholding in Blanket Mine increased to 64% on the effective date.
8
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
5 Blanket Zimbabwe Indigenisation Transaction (continued)
Blanket Mine’s indigenisation shareholding percentages and facilitation loan balances
| Balance of facilitation loan # | ||||||||||||||||||||
| USD | Shareholding | NCI Recognised | NCI subject to facilitation loan | June 30, 2020 | Dec 31, 2019 | |||||||||||||||
| NIEEF | 16 | % | 3.2 | % | 12.8 | % | 11,849 | 11,877 | ||||||||||||
| Fremiro | -& | -& | -& | -& | 11,458 | |||||||||||||||
| Community Trust | 10 | % | 10.0 | % | - | - | - | |||||||||||||
| BETS ~ | 10 | % | - | * | - | * | 7,573 | 7,639 | ||||||||||||
| 36 | % | 13.2 | % | 12.8 | % | 19,422 | 30,974 | |||||||||||||
The balance on the facilitation loans is reconciled as follows:
| 2020 | 2019 | |||||||
| Balance at January 1, | 30,974 | 30,986 | ||||||
| Cancellation of Fremiro loan | (11,458 | ) | - | |||||
| Dividends used to repay loans | (793 | ) | (540 | ) | ||||
| Interest accrued | 699 | 536 | ||||||
| Balance at June 30, | 19,422 | 30,982 |
* The shares held by BETS are effectively treated as treasury shares (see above).
~ Accounted for under IAS19 Employee Benefits.
& After Fremiro purchase agreement.
# Facilitation loans are accounted for as equity instruments and are accordingly not recognised as loans receivable.
Advance dividend loans and balances
In anticipation of completion of the underlying subscription agreements, Blanket Mine agreed to advance dividend arrangements with NIEEF and the Community Trust. Advances made to the Community Trust against their right to receive dividends declared by Blanket Mine on their shareholding are as follows:
| · | a $2 million payment on or before September 30, 2012; |
| · | a $1 million payment on or before February 28, 2013; and |
| · | a $1 million payment on or before April 30, 2013. |
These advance payments were debited to a loan account bearing interest at a rate at the lower of a fixed 7.25% per annum, payable quarterly or the Blanket Mine dividend in the quarter to the advanced dividend loan holder. The loan is repayable by way of set-off of future dividends on the Blanket Mine shares owned by the Community Trust. Advances made to NIEEF as an advanced dividend loan before 2013 have been settled through Blanket Mine dividend repayments in 2014. The advance dividend payments were recognised as distributions to shareholders and they are classified as equity instruments. The loans arising are not recognised as loans receivable, because repayment is by way of uncertain future dividends.
9
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
5 Blanket Zimbabwe Indigenisation Transaction (continued)
Amendments to advanced dividend loan agreements
Advance dividend loan modification - Community Trust
On February 27, 2020, the Group, Blanket Mine and the indigenous shareholders of Blanket Mine reached agreement to change the repayment terms of the advance dividend loan to the Community Trust. The amendment allowed that 20% of the Community Trust share of the Blanket dividend accrue on declaration of the dividend and that the remaining 80% be applied to the advance dividend loan from February 27, 2020. The modification was not considered beneficial to the indigenous shareholders.
The movement in the advance dividend loan to the Community Trust is reconciled as follows:
| 2020 | 2019 | |||||||
| Balance at January 1, | 1,632 | 2,053 | ||||||
| Dividends used to repay advance dividends | (336 | ) | (175 | ) | ||||
| Interest accrued | 53 | 37 | ||||||
| Balance at June 30, | 1,349 | 1,915 |
6 Production costs
| 2020 | 2019 | |||||||
| Salaries and wages | 8,849 | 7,727 | ||||||
| Consumable materials | 7,589 | 5,466 | ||||||
| Electricity costs | 3,959 | 2,715 | ||||||
| Site restoration | - | 10 | ||||||
| Safety | 368 | 399 | ||||||
| Cash-settled share-based expense (note 10(a)) | 191 | 70 | ||||||
| On mine administration | 1,010 | 797 | ||||||
| Pre-feasibility exploration costs | 172 | 156 | ||||||
| 22,138 | 17,340 |
7 Other income
| 2020 | 2019 | |||||||
| Government grant – Gold sale export incentive | 4,695 | 866 | ||||||
| Government grant – Gold Support price | - | 1,064 | ||||||
| Other | 14 | 108 | ||||||
| 4,709 | 2,038 |
10
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
7 Other income (continued)
Government grant – Gold sale export incentive
The Reserve Bank of Zimbabwe (“RBZ”) first announced an export credit incentive (“ECI”) on the gold proceeds received for all large-scale gold mine producers during 2016. The ECI is calculated as a percentage of the gold proceeds less the charges of Fidelity Printers and Refiners Limited (“Fidelity”). The below table indicates when the ECI was applicable and the percentages applied, as announced by government:
| ECI applicable periods | Percentage |
| May 1, 2016 – January 1, 2018 | 3.5% |
| January 1, 2018 – February 1, 2018 | 2.5% |
| February 1, 2018 – February 20, 2019 | 10% |
| March 10, 2020 – June 26, 2020 | 25% |
All incentives granted by the Zimbabwean government were included in other income when determined receivable and receipts were received in Blanket Mine’s RTGS$ account. ECI fell away after June 26, 2020.
Government grant – Gold support price
From March 6, 2019 it became apparent that Blanket Mine’s sales proceeds received from Fidelity were calculated at a gross price of $44,000 per kilogram ($1,368.58 per ounce), which exceeded the prevailing London Bullion Market Association (“LBMA”) price. On May 12, 2019, the Company received confirmation from Fidelity of this windfall receipt, called the “gold support price”, which has been implemented to incentivise gold producers to increase gold production. No gold support price was received as the LBMA gold price for the last 6 months was over and above $1,368.58 per ounce.
8 Other expenses
| 2020 | 2019 | |||||||
| Intermediated Money Transaction Tax | 213 | 165 | ||||||
| Solar expenses | 202 | - | ||||||
| COVID-19 Donations | 1,048 | - | ||||||
| Impairment of property, plant and equipment | 59 | 144 | ||||||
| 1,522 | 309 |
Blanket Mine donated funds towards the Zimbabwean Ministry of Mines and Development in helping to combat the spread of COVID-19 and the impacts thereof.
9 Administrative expenses
| 2020 | 2019 | |||||||
| Investor relations | 174 | 255 | ||||||
| Audit fee | 124 | 118 | ||||||
| Advisory services fee | 272 | 195 | ||||||
| Listing fees | 190 | 170 | ||||||
| Directors fees company | 140 | 112 | ||||||
| Directors fees Blanket | 20 | 8 | ||||||
| Employee costs | 1,588 | 1,383 | ||||||
| Other office administration costs | 229 | 309 | ||||||
| Travel costs | 85 | 138 | ||||||
| Eersteling Gold Mine administration costs | - | 17 | ||||||
| 2,822 | 2,705 |
11
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
10 Cash-settled share-based payments
The Group has expensed the following cash-settled share-based payment arrangements for the 6 months ended June 30:
| Note | 2020 | 2019 | ||||||||||
| Restricted Share Units and Performance Units | 10(a) | 927 | 344 | |||||||||
| Caledonia Mining South Africa employee incentive scheme | 10(b) | 19 | 26 | |||||||||
| 946 | 370 |
(a) Restricted Share Units and Performance Units
Certain key management members were granted Restricted Share Units (“RSUs”) and Performance Units (”PUs”) pursuant to provisions of the 2015 Omnibus Equity Incentive Compensation Plan. All RSUs and PUs were granted and approved by the Compensation Committee of the Board of Directors.
RSUs vest three years after grant date given that the service condition of the relevant employees have been fulfilled. The value of the vested RSUs is the number of RSUs vested multiplied by the fair market value of the Company’s shares, as specified by the plan, on date of settlement.
PUs have a performance condition based on gold production and a performance period of three years. The number of PUs that vest will be the PUs granted multiplied by the performance multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.
RSU holders are entitled to receive dividends over the vesting period. Such dividends will be reinvested in additional RSUs at the then applicable share price calculated at the average Bank of Canada rate immediately preceding the dividend payment. PUs have rights to dividends only after they have vested.
RSUs and PUs allow for settlement of the vesting date value in cash or shares issuable at fair market value or a combination of both at the discretion of the unit holder.
The fair value of the RSUs, at the reporting date, was based on the Black Scholes option valuation model. The fair value of the PUs, at the reporting date, was based on the Black Scholes option valuation model less the fair value of the expected dividends during the vesting period multiplied by the performance multiplier expectation. At the reporting date it was assumed that there is a 93%-100% probability that the performance conditions will be met and therefore a 93%-100% (2019: 93%-100%) average performance multiplier was used in calculating the estimated liability. The liability as at June 30, 2020 amounted to $1,426 (December 31, 2019: $524). Included in the liability as at June 30, 2020 is an amount of $191 (June 30, 2019: $70) that was expensed and classified as production costs; refer note 6. During the year PUs and RSUs to the value of $216 vested and were issued as share capital.
12
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
10 Cash-settled share-based payments (continued)
(a) Restricted Share units and Performance Units (continued)
The following assumptions were used in estimating the fair value of the cash-settled share-based payment liability on:
| June 30, 2020 | December 31, 2019 | |||||||||||||||
| RSUs | PUs | RSUs | PUs | |||||||||||||
| Fair value (USD) | $ | 17.32 | $ | 17.32 | $ | 5.85 | $5.49-5.79 | |||||||||
| Share price (USD) | $ | 17.32 | $ | 16.98 | $ | 5.85 | $ | 5.85 | ||||||||
| Performance multiplier percentage | - | 93-100% | - | 93-100% | ||||||||||||
Share units granted:
| RSUs | PUs | RSUs | PUs | |||||||||||||
| Grant – January 11, 2016 | - | - | 60,645 | 242,579 | ||||||||||||
| Grant- March 23, 2016 | - | - | 10,965 | 43,871 | ||||||||||||
| Grant – June 8, 2016 | - | - | 5,117 | 20,470 | ||||||||||||
| Grant - January 19, 2017 | 4,443 | 17,774 | 4,443 | 17,774 | ||||||||||||
| Grant - January 19, 2019 | - | 124,027 | - | 124,027 | ||||||||||||
| Grant - June 8, 2019 | - | 14,672 | - | 14,672 | ||||||||||||
| Grant - January 11, 2020 | 17,585 | 107,640 | - | - | ||||||||||||
| Grant - January 19, 2020 | - | 13,692 | - | - | ||||||||||||
| Grant - March 31, 2020 | - | 1,971 | ||||||||||||||
| Grant – June 1, 2020 | - | 1,740 | ||||||||||||||
| RSU dividends reinvested | 869 | - | 11,316 | - | ||||||||||||
| Settlements | (5,052 | ) | (17,774 | ) | (87,434 | ) | (306,920 | ) | ||||||||
| Total awards | 17,845 | 263,742 | 5,052 | 156,473 |
(b) Caledonia Mining South Africa employee incentive scheme
From 2017 Caledonia Mining South Africa Proprietary Limited granted 52,282 awards to certain of its employees that entitle them to a cash pay-out at the Company’s share price on November 30, each year over a 3 year period from the grant date. The cash-settled share-based payment liability was calculated based on the number of awards expected to vest multiplied by the Company’s Black Scholes option valuation fair value of £7.44 at the reporting date and apportioned for the quantity vested over the total vesting period. The liability relating to these cash-settled share-based payment awards amounted to $31 (December 31, 2019: $16) and the expense amounted to $19 (June 30, 2019: $26) for the 6 months ended June 30, 2020. The following assumptions were used in estimating the fair value of the cash-settled share-based payment liability for the 6 months ended June 30, 2020.
13
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
10 Cash-settled share-based payments (continued)
(b) Caledonia Mining South Africa employee incentive scheme (continued)
June 30, 2020 | December 31, 2019 | |||||||
| Awards | ||||||||
| Grant – July 2017 (3 year term) | - | 37,330 | ||||||
| Grant – August 2018 (3 year term) | 5,918 | 5,918 | ||||||
| Grant – August 2019 (3 year term) | 9,034 | 9,034 | ||||||
| Awards paid out | (7,655 | ) | (44,985 | ) | ||||
| Total awards outstanding | 7,297 | 7,297 | ||||||
| Estimated awards expected to vest | 100 | % | 100 | % | ||||
11 Net foreign exchange gain
On October 1, 2018 the RBZ issued a directive to Zimbabwean banks to separate foreign currency from RTGS$ in the accounts held by their clients and pegged the RTGS$ at 1:1 to the US Dollar. On February 20, 2019 the RBZ issued a further monetary policy statement, which allowed inter-bank trading between RTGS$ and foreign currency. The interbank rate was introduced at 2.5 RTGS$ to 1 US Dollar and traded at 57.3582 RTGS$ to 1 US Dollar as at June 30, 2020 (December 2019: 16.77 RTG$). On June 24, 2019 the Government issued S.I. 142 which stated, “Zimbabwe dollar (RTGS$) to be the sole currency for legal tender purposes for any transactions in Zimbabwe”. Throughout these announcements and to the date of issue of these financial statements the US dollar has remained the primary currency in which the Group’s Zimbabwean entities operate and the functional currency of these entities.
Previously there was uncertainty as to what currency would be used to settle amounts owed to the Zimbabwe Government. The announcement of S.I. 142 clarified the Zimbabwean Government’s intentions that these liabilities were always denominated in RTGS$ and that RTGS$ would be the currency in which they would be settled. The devaluation of the deferred tax and electricity liabilities contributed the largest portion of the foreign exchange gain set out below.
The table below illustrates the effect the weakening of the RTGS$ and other non-RTGS$ currencies had, against the US Dollar, on the statement of profit or loss and other comprehensive income.
| 2020 | 2019 | |||||||
| Unrealised foreign exchange gain | 5,201 | 25,447 | ||||||
| Realised foreign exchange loss | (1,492 | ) | (522 | ) | ||||
| Net foreign exchange gain | 3,709 | 24,925 |
14
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
12 Property, plant and equipment
| Land and buildings | Mine development, infrastructure and other | Exploration and Evaluation assets | Plant and equipment | Fixtures and fittings | Motor vehicles | Total | ||||||||||||||||||||||
| Cost | ||||||||||||||||||||||||||||
| Balance at January 1, 2019 | 10,339 | 74,509 | 6,967 | 32,675 | 923 | 2,402 | 127,815 | |||||||||||||||||||||
| Initial recognition of right of use assets | 409 | - | - | - | - | - | 409 | |||||||||||||||||||||
| Additions* | 267 | 19,020 | 172 | 897 | 88 | 151 | 20,595 | |||||||||||||||||||||
| Impairments | - | - | - | (144 | ) | - | - | (144 | ) | |||||||||||||||||||
| Disposals | (212 | ) | - | - | - | - | (16 | ) | (228 | ) | ||||||||||||||||||
| Reallocations between asset classes | 25 | (2,989 | ) | - | 2,964 | - | - | - | ||||||||||||||||||||
| Foreign exchange movement | 5 | 2 | - | 3 | 7 | 1 | 18 | |||||||||||||||||||||
| Balance at December 31, 2019 | 10,833 | 90,542 | 7,139 | 36,395 | 1,018 | 2,538 | 148,465 | |||||||||||||||||||||
| Additions* | - | 6,633 | 62 | 1,314 | 46 | 133 | 8,188 | |||||||||||||||||||||
| Impairments | - | - | - | (59 | ) | - | - | (59 | ) | |||||||||||||||||||
| Reallocations between asset classes | 556 | (687 | ) | - | 131 | - | - | - | ||||||||||||||||||||
| Foreign exchange movement | (37 | ) | - | - | (28 | ) | (59 | ) | (7 | ) | (131 | ) | ||||||||||||||||
| Balance at June 30, 2020 | 11,352 | 96,488 | 7,201 | 37,753 | 1,005 | 2,664 | 156,463 |
* Included in additions is an amount of $6,476 (December 31, 2019: $20,093) relating to capital work in progress (“CWIP”) and contains $26 (December 31, 2019: $165) of borrowing costs capitalised from the term loan. As at period end $83,323 of CWIP was included in the cost closing balance (December 31, 2019: $76,847).
15
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
12 Property, plant and equipment (continued)
| Land and buildings | Mine development, infrastructure and other | Exploration and Evaluation assets | Plant and equipment | Fixtures and fittings | Motor vehicles | Total | ||||||||||||||||||||||
| Accumulated depreciation and Impairment losses | ||||||||||||||||||||||||||||
| Balance at January 1, 2019 | 4,411 | 5,821 | - | 17,357 | 649 | 2,150 | 30,388 | |||||||||||||||||||||
| Initial recognition of right of use of assets | 146 | - | - | - | - | - | 146 | |||||||||||||||||||||
| Depreciation for the year | 1,005 | 504 | - | 2,693 | 99 | 133 | 4,434 | |||||||||||||||||||||
| Impairments | - | - | - | - | - | - | - | |||||||||||||||||||||
| Disposals | (149 | ) | - | - | - | - | (16 | ) | (165 | ) | ||||||||||||||||||
| Foreign exchange movement | - | - | - | - | 5 | 6 | 11 | |||||||||||||||||||||
| Balance at December 31, 2019 | 5,413 | 6,325 | - | 20,050 | 753 | 2,273 | 34,814 | |||||||||||||||||||||
| Depreciation | 507 | 294 | - | 1,396 | 46 | 71 | 2,314 | |||||||||||||||||||||
| Foreign exchange movement | (21 | ) | - | - | - | (52 | ) | (2 | ) | (75 | ) | |||||||||||||||||
| Balance at June 30, 2020 | 5,899 | 6,619 | - | 21,446 | 747 | 2,342 | 37,053 | |||||||||||||||||||||
| Carrying amounts | ||||||||||||||||||||||||||||
| At December 31, 2019 | 5,420 | 84,217 | 7,139 | 16,345 | 265 | 265 | 113,651 | |||||||||||||||||||||
| At June 30, 2020 | 5,453 | 89,869 | 7,201 | 16,307 | 258 | 322 | 119,410 |
16
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
13 Inventories
| December 31, | ||||||||
| 2020 | 2019 | |||||||
| Consumable stores | 12,010 | 10,716 | ||||||
| Gold in progress | - | 376 | ||||||
| 12,010 | 11,092 | |||||||
14 Trade and other receivables
| December 31, | ||||||||
| 2020 | 2019 | |||||||
| Bullion sales receivable | 4,027 | 2,987 | ||||||
| VAT receivables | 1,169 | 1,765 | ||||||
| Deferred consideration on the disposal of subsidiary | 1,099 | 1,991 | ||||||
| Deposits for stores and equipment and other receivables | 875 | 169 | ||||||
| 7,170 | 6,912 | |||||||
The net carrying value of trade receivables is considered a reasonable approximation of fair value and are short-term in nature. No provision for expected credit losses were recognised as all scheduled payments were received up to the date of approval of these financial statements and non-payment of Trade and other receivables were not foreseen. The Bullion sales receivable was received after the quarter end.
15 Derivative financial assets
| December 31, | ||||||||
| 2020 | 2019 | |||||||
| Derivatives not designated as hedging instrument: | ||||||||
| Gold exchange traded fund (Gold ETF) | 1,112 | - | ||||||
| Gold Hedge | - | 102 | ||||||
| 1,112 | 102 |
Gold ETF
In April 2020 the South African subsidiary, Caledonia Mining South Africa Proprietary Limited, purchased a Gold ETF through Standard Bank Limited at a cost of $1,058. The Gold ETF is denominated in South African Rand and the instrument is utilised to invest excess short term Rands on hand at the South Africa subsidiary. The Gold ETF’s value tracks the US spot gold price and was entered into to offset fluctuations in the South African Rand against the US Dollar. The total expense, representing the change in the Rand tracked US spot gold price, amounted to $46 (2019: $Nil) for the 6 months ended June 30, 2020. Foreign currency translation gains, due to the fluctuations in the Rand against the US Dollar on translation of the foreign subsidiary, amounted to $100 (2019:Nil).
17
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
15 Derivative financial asset (continued)
Gold Hedge
The Company entered into a hedge in November 2019 at a cost of $379. The hedge was in the form of put options in respect of 4,600 ounces of gold for the period January to June 2020 exercisable at a strike price of $1,400 per ounce. At December 31, 2019 the mark-to-market valuation, that represents the fair value of the hedge amounted to $102 (2018: Nil). The hedges were entered into by the Company for economic hedging purposes to ensure sufficient cash availability for Blanket Mine’s capital investment plan, rather than as a speculative investment. The total expense of the derivative contract amounted to $102 (2019: $324) for the 6 months ended June 30, 2020.
| Fair value losses on derivative assets | 2020 | 2019 | ||||||
| Gold ETF | 46 | - | ||||||
| Gold hedge | 102 | 324 | ||||||
| 148 | 324 |
16 Cash flow information
Non-cash items and information presented separately on the cash flow statement:
| 2020 | 2019 | |||||||
| Operating profit | 22,715 | 39,981 | ||||||
| Adjustments for: | ||||||||
| Unrealised foreign exchange gains (Note11) | (5,201 | ) | (25,447 | ) | ||||
| Cash-settled share-based expense (Note 10) | 946 | 370 | ||||||
| Cash-settled share-based expense included in production costs (Note 6) | 191 | 70 | ||||||
| Settlement of cash-settled share-based payments | - | (1,280 | ) | |||||
| Gold hedge - unrealised cash portion (Note 15) | 102 | 324 | ||||||
| Depreciation | 2,314 | 2,100 | ||||||
| Impairment of property, plant and equipment | 59 | 144 | ||||||
| Gold ETF - non-cash fair value losses loss (Note15) | 46 | - | ||||||
| Profit on sale of subsidiary | - | (5,409 | ) | |||||
| Site restoration | - | 10 | ||||||
| Cash generated by operations before working capital changes | 21,172 | 10,863 | ||||||
| Inventories | (1,292 | ) | (302 | ) | ||||
| Prepayments | 744 | (529 | ) | |||||
| Trade and other receivables | (2,595 | ) | 23 | |||||
| Trade and other payables | (1,657 | ) | (938 | ) | ||||
| Cash generated by operations | 16,371 | 9,117 |
18
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
17 Operating Segments
The Group's operating segments have been identified based on geographic areas. The strategic business units are managed separately because they require different technology and marketing strategies. For each of the strategic business units, the Group’s CEO reviews internal management reports on at least a quarterly basis. Zimbabwe and South Africa describe the operations of the Group's reportable segments. The Zimbabwe operating segment comprises Caledonia Holdings Zimbabwe (Private) Limited and subsidiaries. The South Africa geographical segment comprises a gold mine, that is on care and maintenance (and now sold), as well as sales made by Caledonia Mining South Africa Proprietary Limited to the Blanket Mine. The holding company (Caledonia Mining Corporation Plc) and Greenstone Management Services Holdings Limited (a UK company) responsible for administrative functions within the group are taken into consideration in the strategic decision-making process of the CEO and are therefore included in the disclosure below. Reconciling amounts do not represent a separate segment. Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit before income tax, as included in the internal management report that are reviewed by the Group's CEO. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries.
Information about reportable segments
| For the 6 months ended June 30, 2020 | Zimbabwe | South Africa | Inter-group eliminations adjustments | Corporate and other reconciling amounts | Total | |||||||||||||||
| Revenue | 46,515 | 7,638 | (7,638 | ) | - | 46,515 | ||||||||||||||
| Royalties | (2,328 | ) | - | - | - | (2,328 | ) | |||||||||||||
| Production costs | (22,241 | ) | (6,502 | ) | 6,605 | - | (22,138 | ) | ||||||||||||
| Depreciation | (2,499 | ) | (43 | ) | 248 | (20 | ) | (2,314 | ) | |||||||||||
| Other income | 4,705 | 4 | - | - | 4,709 | |||||||||||||||
| Other expenses | (1,410 | ) | (112 | ) | - | - | (1,522 | ) | ||||||||||||
| Administration expenses | (68 | ) | (873 | ) | - | (1,881 | ) | (2,822 | ) | |||||||||||
| Management fee | (1,279 | ) | 1,279 | - | - | - | ||||||||||||||
| Cash-settled share-based payment expense | - | (19 | ) | 191 | (1,118 | ) | (946 | ) | ||||||||||||
| Net foreign exchange gain | 3,746 | (579 | ) | - | 542 | 3,709 | ||||||||||||||
| Gold hedge fair value losses | - | - | - | (102 | ) | (102 | ) | |||||||||||||
| Gold ETF fair value losses | - | (46 | ) | - | (46 | ) | ||||||||||||||
| Net finance costs | (298 | ) | 28 | - | 3 | (267 | ) | |||||||||||||
| Dividends (paid)/ received | (2,198 | ) | (1,202 | )) | - | 3,400 | - | |||||||||||||
| Profit before tax | 22,645 | (427 | ) | (594 | ) | 824 | 22,448 | |||||||||||||
| Tax expense | (5,905 | ) | (224 | ) | (59 | ) | (229 | ) | (6,417 | ) | ||||||||||
| Profit for the period | 16,740 | (651 | ) | (653 | ) | 595 | 16,031 |
19
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
17 Operating Segments (continued)
| As at June 30, 2020 | Zimbabwe | South Africa | Inter-group eliminations adjustments | Corporate and other reconciling amounts | ||||||||||||||||
| Geographic segment assets: | ||||||||||||||||||||
| Current (excluding intercompany) | 22,665 | 6,165 | (77 | ) | 6,093 | 34,846 | ||||||||||||||
| Non-Current (excluding intercompany) | 121,495 | 533 | (2,746 | ) | 224 | 119,506 | ||||||||||||||
| Expenditure on property, plant and equipment (Note 12) | 8,655 | 12 | (479 | ) | - | 8,188 | ||||||||||||||
| Intercompany balances | 14,962 | 5,214 | (72,332 | ) | 52,156 | - | ||||||||||||||
| Geographic segment liabilities: | ||||||||||||||||||||
| Current (excluding intercompany) | (6,910 | ) | (2,422 | ) | - | (577 | ) | (9,909 | ) | |||||||||||
| Non-current (excluding intercompany) | (5,257 | ) | - | 152 | (1,383 | ) | (6,488 | ) | ||||||||||||
| Intercompany balances | - | (32,809 | ) | 72,332 | (39,523 | ) | - |
| For the 6 months ended June 30, 2019 | Zimbabwe | South Africa | Inter-group eliminations adjustments | Corporate and other reconciling amounts | Total | |||||||||||||||
| Revenue | 32,440 | 6,092 | (5,878 | ) | (214 | ) | 32,440 | |||||||||||||
| Royalties | (1,683 | ) | - | - | - | (1,683 | ) | |||||||||||||
| Production costs | (17,320 | ) | (5,365 | ) | 5,345 | - | (17,340 | ) | ||||||||||||
| Depreciation | (2,217 | ) | (55 | ) | 172 | - | (2,100 | ) | ||||||||||||
| Other income | 2,036 | 2 | - | - | 2,038 | |||||||||||||||
| Other expenses | (309 | ) | - | - | - | (309 | ) | |||||||||||||
| Administration expenses | (54 | ) | (955 | ) | - | (1,696 | ) | (2,705 | ) | |||||||||||
| Management fee | (1,123 | ) | 1,123 | - | - | - | ||||||||||||||
| Cash-settled share-based payment expense | (149 | ) | (84 | ) | - | (137 | ) | (370 | ) | |||||||||||
| Net foreign exchange gain | 24,896 | 11 | - | 18 | 24,925 | |||||||||||||||
| Profit on sale of subsidiary | - | - | - | 5,409 | 5,409 | |||||||||||||||
| Gold hedge fair value losses | - | - | - | (324 | ) | (324 | ) | |||||||||||||
| Net finance costs | (62 | ) | 36 | - | 6 | (20 | ) | |||||||||||||
| Profit before tax | 36,455 | 805 | (361 | ) | 3,062 | 39,961 | ||||||||||||||
| Tax expense | (1,026 | ) | (253 | ) | 23 | (40 | ) | (1,296 | ) | |||||||||||
| Profit for the period | 35,429 | 552 | (338 | ) | 3,022 | 38,665 |
20
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
17 Operating Segments (continued)
| As at December 31, 2019 | Zimbabwe | South Africa | Inter-group elimination adjustments | Corporate and other reconciling amounts | Total | |||||||||||||||
| Geographic segment assets: | ||||||||||||||||||||
| Current (excluding intercompany) | 21,608 | 3,383 | (139 | ) | 4,987 | 29,839 | ||||||||||||||
| Non-current (excluding intercompany) | 115,611 | 315 | (2,456 | ) | 244 | 113,714 | ||||||||||||||
| Expenditure on property, plant and equipment (Note 12) | 21,465 | 47 | (1,165 | ) | 248 | 20,595 | ||||||||||||||
| Intercompany balances | - | 8,869 | (52,783 | ) | 43,914 | - |
| Geographic segment liabilities | ||||||||||||||||||||
| Current (excluding intercompany) | (9,478 | ) | - | 140 | (736 | ) | (10,074 | ) | ||||||||||||
| Non-current (excluding intercompany) | (6,784 | ) | (1,563 | ) | - | (415 | ) | (8,762 | ) | |||||||||||
| Intercompany balances | (2,441 | ) | (32,558 | ) | 52,783 | (17,784 | ) | - |
Major customer
Revenues from Fidelity amounted to $46,515 (2019: $32,440) for the 6 months ended June 30, 2020.
21
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
DIRECTORS AND OFFICERS at August 13, 2020
| BOARD OF DIRECTORS | OFFICERS |
|
L.A. Wilson (2) (3) (4) (5) (7) Chairman of the Board |
S. R. Curtis (5) (6) (7) Chief Executive Officer |
| Non-executive Director | Johannesburg, South Africa |
| Florida, United States of America | |
| S. R. Curtis (5) (6) (7) | D. Roets (5) (6) (7) |
|
Chief Executive Officer Johannesburg, South Africa |
Chief Operating Officer Johannesburg, South Africa |
| J. L. Kelly (1) (2) (3) (4) (5) (7) | M. Learmonth (5) (7) |
|
Non-executive Director Connecticut, United States of America |
Chief Financial Officer Jersey, Channel Islands |
| J. Holtzhausen (1) (2) (4) (5) (6) (7) | M. Mason (5) (7) |
|
Chairman Audit Committee Non-executive Director, Cape Town, South Africa |
VP Corporate Development and Investor Relations London, England |
| M. Learmonth (5) (7) | A. Chester (5) |
| Chief Financial Officer | General Counsel, Company Secretary and Head of |
| Jersey, Channel Islands | Risk and Compliance |
| Jersey, Channel Islands | |
| John McGloin (1) (3) (4) (6) (7) | Board Committees |
| Non-executive Director | (1) Audit Committee |
| Bishops Stortford, United Kingdom | (2) Compensation Committee |
| (3) Corporate Governance Committee | |
| N. Clark (4) (6) (7) | (4) Nomination Committee |
| Non-executive Director | (5) Disclosure Committee |
| East Molesey, United Kingdom |
(6) Technical Committee |
| (7) Strategic Planning Committee |
22
Caledonia Mining Corporation Plc
Notes to the Condensed Consolidated Interim Financial Statements
(in thousands of United States dollars, unless indicated otherwise)
CORPORATE DIRECTORY as at August 13, 2020
| CORPORATE OFFICES | SOLICITORS |
| Jersey – Head and Registered Office | Mourant Ozannes (Jersey) |
| Caledonia Mining Corporation Plc | 22 Grenville Street |
B006 Millais House |
St Helier |
| Castle Quay | Jersey |
| St Helier | Channel Islands |
| Jersey JE2 3NF | |
| South Africa | Borden Ladner Gervais LLP (Canada) |
| Caledonia Mining South Africa Proprietary Limited | Suite 4100, Scotia Plaza |
| P.O. Box 4628 | 40 King Street West |
| Weltevreden park | Toronto, Ontario M5H 3Y4 Canada |
| 1715 | |
| South Africa | |
| Memery Crystal LLP (United Kingdom) | |
| Zimbabwe | 165 Fleet Street |
| Caledonia Holdings Zimbabwe (Private) Limited | London EC4A 2DY |
| P.O. Box CY1277 | United Kingdom |
| Causeway, Harare | |
| Zimbabwe | |
| Dorsey & Whitney LLP (US) | |
| Capitalisation (August 13, 2020) | TD Canada Trust Tower |
| Authorised: Unlimited | Brookfield Place |
| Shares, Warrants and Options Issued: | 161 Bay Street |
| Shares: 11,820,931 | Suite 4310 |
| Options: 33,000 | Toronto, Ontario |
| M5J 2S1 Canada | |
| SHARE TRADING SYMBOLS | |
| NYSE American - Symbol “CMCL” | AUDITORS |
| AIM - Symbol “CMCL” | BDO South Africa Incorporated |
| Wanderers Office Park | |
| BANKERS | 52 Corlett Drive |
| Barclays | Illovo 2196 |
| 13 Library Place | South Africa |
| St Helier, Jersey | Tel: +27(0)105907200 |
| REGISTRAR & TRANSFER AGENT | |
| Computershare | |
| 100 University Ave, 8th Floor, | |
| Toronto, Ontario, M5J 2Y1 | |
| Tel: +1416263 9483 |
23