TIDMPOW
RNS Number : 8815G
Power Metal Resources PLC
24 July 2023
24 July 2023
Power Metal Resources PLC
("Power Metal" or the "Company")
Commercial Update
Power Metal Resources PLC (AIM:POW), the AIM listed metals
exploration and development company, is pleased to provide a
commercial update covering a number of corporate initiatives
currently underway and to also provide a financial update with the
latest available unaudited Gross Asset and Shareholders' Equity
position of the Company as at 30 June 2023.
Highlights:
-- Multiple corporate initiatives underway to optimise Power
Metal's positioning ahead of a resource sector recovery with work
advancing concurrently across various business interests.
-- Accelerated exploration underway across the Company's
Athabasca uranium interests in Saskatchewan, Canada and the Tati
Goldfields project in Botswana.
-- Intention to apply for OTC listing for easier trading of
Power Metal shares on market by US investors.
-- Appointment of Financial Adviser to Uranium Energy
Exploration for their planned listing, the Company's first uranium
project spin-out listing.
-- Significant increase in Gross Assets and Shareholders' Equity
since 30 September 2020 year end, in absolute terms and also per
issued share, demonstrating that Power Metal has been generating
value per share notwithstanding share dilution over the period.
Sean Wade, Chief Executive Officer of Power Metal Resources plc,
commented:
"I am very pleased to be able to update shareholders on these
important developments. We are well aware of the challenging market
conditions of late, and as such, it is important for us to
demonstrate to shareholders that significant steps are being taken
to position the Company in readiness for what we expect will be a
considerable recovery in the junior resource sector.
"The planned application for an OTC listing will give us the
opportunity to address a much wider international investor base and
therefore substantially improve liquidity in the shares. We want to
make it as easy as possible for people to invest and this is a
significant step forward in that regard.
"We see significant potential demand for a pure-play uranium
exploration vehicle and look forward to the planned listing of
Uranium Energy Exploration. We are also excited about the planned
listing of First Development Resources. Both events will, we
believe, deliver considerable Balance Sheet expansion.
"As far as the Balance Sheet is concerned more generally, I am
very pleased to update shareholders on where this stands as at 30
June 2023. We have continued to achieve excellent growth in
Shareholder Equity since the 30 September 2022 year end, reflecting
the successful IPO of Golden Metal Resources and other corporate
activities. Importantly our Shareholder Equity per share has grown
over recent years demonstrating that the financings undertaken have
fed through to increasing value for shareholders.
"During the summer and autumn period, the Company is looking to
finalise a number of value crystallisation events that we expect to
further bolster the balance sheet.
"Finally, it is important to note that Power Metal is focused on
achieving major metal discoveries across its portfolio of
interests. In that respect, we are similar to many exploration
companies. However, rather than expect our shareholders to bear the
costs of all exploration through repeated rounds of equity
financing, we are also focused on finding, through spin-out
listings, joint ventures and disposals (principally for acquirer
equity), multiple innovative financing structures for the costs of
project management and exploration. We will continue to offer
shareholders material exposure to the discovery upside through
large equity holdings in our investee companies."
Corporate Initiatives
Power Metal has undertaken three project disposals to date
leading to significant equity positions in Kavango Resources PLC
(LON:KAV), First Class Metals PLC (LON:FCM) and Golden Metal
Resources PLC (LON:GMET). Together these investments are currently
valued at GBP6.7 million and represent a small proportion of the
historic project interests previously held by the Company.
The Company is eager to build a more extensive portfolio of
investments through continuing disposals and recognises the
potential for the value of the portfolio to grow considerably
through this disposal activity and, as the junior resource sector
recovers, through an appreciation of the value of its underlying
investments.
At present, the Company is actively pursuing a number of
corporate initiatives in the following business interests as
summarised below. Shareholders should note, however, that there can
be no certainty that the current initiatives underway below will
lead to a successful conclusion.
Business Interest Commercial Work Underway
Silver Peak Project, Discussions underway to determine the optimal
Canada (30% POW) ownership structure and advancement of
the project.
------------------------------------------------
Athabasca Basin, Planned listing of Uranium Energy Exploration
Canada (100% POW) (see appointment of Financial Adviser below).
------------------------------------------------
ION Battery Resources Following completion of Authier project
Ltd, Canada (100% Earn-In announced recently, plans are being
POW) finalised for the next corporate steps,
seeking to maximise value for Power Metal.
------------------------------------------------
Tati Goldfields, Pursuing discussions to determine the optimal
Botswana (100% POW) ownership structure and advancement of
the project.
------------------------------------------------
Molopo Farms Complex, Pursuing multi-party discussions to secure
Botswana (87.71% project level financing or joint venture
POW) partner to enable accelerated exploration
across extensive nickel and platinum group
metal targets delineated from historical
exploration work.
------------------------------------------------
Haneti project, Tanzania Discussions continuing with joint venture
(30% POW) partner Katoro Gold PLC (LON:KAT) with
regard to future ownership and advancement
of the project.
------------------------------------------------
First Development Pursuing multi-party discussions on cornerstone
Resources PLC, Australia strategic investment in the IPO financing,
(58.59% POW) leading to completion of IPO financing
and listing in the London capital markets.
------------------------------------------------
New Horizon Metals Discussions advancing for the disposal
Pty Ltd, Australia of POW interest.
(20% POW)
------------------------------------------------
New Ballarat Gold Discussions continuing with joint venture
Corporation PLC, partner Red Rock Resources PLC (LON:RRR)
Australia (49.9% with regard to future ownership structure
POW) and advancement of the project.
------------------------------------------------
In addition, the Company is actively involved in discussions in
respect of exploration and development opportunities in Saudi
Arabia, which are plentiful and offer high impact potential for the
Company. Further information in respect of material developments
will be announced in due course.
Accelerated Exploration
Alongside the above corporate initiatives, the Company is
pursuing proactive exploration at a number of properties in and
surrounding the Athabasca Basin, targeting uranium discoveries; and
also, at the Tati Goldfields project in Botswana, targeting a
significant gold discovery.
Further exploration focused updates are expected as material
developments occur.
OTC Listing
The Company is pleased to announce that it is intending to apply
for a listing on the US OTC market. The application will be subject
to various regulatory approvals and an update on its progress will
be provided in due course.
If successful, this important step will provide easier trading
accessibility for US investors wishing to buy Power Metal shares on
market and will, in the Company's view, potentially increase the
liquidity of Power Metal share trading.
Appointment of Beaumont Cornish as Financial Adviser to Uranium
Energy Exploration ("UEE")
The Company is pleased to announce the appointment by UEE of
Beaumont Cornish Limited as Financial Adviser in respect to the
intended listing of UEE on a recognised London exchange. The
listing will be subject to the various regulatory approvals and an
update will be provided in due course.
The UEE transaction details are being finalised and a further
update to the market will be provided in due course. UEE will hold
the Reitenbach and E-12 uranium properties in Saskatchewan, Canada
currently 100 per cent owned by Power Metal. Additional selected
interests from the current portfolio and external assets may be
added to enhance the planned listing portfolio.
Financial Update
Power Metal is pleased to report that, on an unaudited basis,
the Company Shareholders' Equity as at 30 June 2023 was GBP15.5m vs
GBP10.2m, on an audited basis, as at 30 September 2022,
demonstrating growth of 52 per cent*.
The Company's Gross Assets total as at 30 June 2023 was GBP15.8m
vs GBP10.7m, on an audited basis, as at 30 September 2022,
demonstrating growth of 48 per cent*.
* The Consolidated Shareholders' Equity at 30 September 2022 was
GBP11.7m and the Consolidated Gross Assets GBP14.6m. The
Consolidation process is an accounting exercise that fully reflects
the value of subsidiary company net assets , however the
consolidation exercise is only conducted as part of the preparation
of `power metal's interim and full year financial statements.
The Gross Asset and Shareholder Equity figures are accounting
valuations based on cash, listed investments at market value on 30
June 2023 and the cost value of project acquisitions and project
operational expenditures (corporate and exploration costs).
The Company and Consolidated Gross Assets and Shareholder Equity
per issued ordinary share has been increasing each reporting period
end since 30 September 2020, demonstrating that Power Metal has
been generating value per share notwithstanding share dilution over
the period.
Since 30 September 2020, the Company (unconsolidated) Gross
Assets per issued POW share have grown by 89 per cent and Company
Shareholder Equity per share by 105 per cent to 30 June 2023.
The growth outlined above has been achieved despite extremely
challenging market conditions over recent years and without the
benefit of stronger listed asset valuations that would ordinarily
occur in more normalised or positive market conditions.
In addition, accounting valuations, other than for cash or
listed investments, Gross Assets and Shareholder Equity do not
reflect the full value of business interests at the reporting date,
many of which, in the Board's view, are now worth considerably more
than their accounting valuation at 30 June 2023. That value will be
more accurately reflected as disposals of project interests are
undertaken at market value.
For clarity, included within the above Gross Asset valuation at
30 June 2023 is cash and listed investments of c. GBP10.0m.
For further information please visit
https://www.powermetalresources.com/ or contact:
Power Metal Resources plc
Sean Wade (Chief Executive Officer) +44 (0) 20 3778 1396
SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat/Charlie Bouverat +44 (0) 20 3470 0470
SI Capital Limited (Joint Broker)
Nick Emerson +44 (0) 1483 413 500
First Equity Limited (Joint Broker)
David Cockbill/Jason Robertson +44 (0) 20 7330 1883
BlytheRay (PR Advisors) +44 (0) 20 7138 3204
Tim Blythe
Megan Ray
NOTES TO EDITORS
Power Metal Resources plc - Background
Power Metal Resources plc (AIM:POW) is an AIM listed metals
exploration company which finances and manages global resource
projects.
The Company has a principal focus on opportunities offering
district scale potential across a global portfolio including
precious, base and strategic metal exploration in North America,
Africa and Australia.
Project interests range from early-stage greenfield exploration
to later-stage prospects currently subject to drill programmes.
Power Metal will develop projects internally or through
strategic joint ventures until a project becomes ready for disposal
through outright sale or separate listing on a recognised stock
exchange, thereby crystallising the value generated from our
internal exploration and development work.
Value generated through disposals will be deployed internally to
grow the Company or may be returned to shareholders through share
buy backs, dividends or in-specie distributions of assets.
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END
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