CFO FINANCIAL REVIEW  

(H1 2024 vs H1 2023)

We are pleased to report material improvements across the majority of our key financial metrics including revenue, EBITDA, profit before tax, operating cash flow and free cash flow.

H1 2024 has delivered strong operating cash flow of US$204 million. This translated into a positive Group free cash flow of US$43 million, after Sukari profit share distributions of US$74 million to our Egyptian partner, EMRA, and US$74 million to Centamin, and US$12 million spent advancing our organic growth pipeline at Doropo (Côte d'Ivoire), EDX (Egypt) and ABC (Côte d'Ivoire).

FINANCIAL PERFORMANCE

Revenues increased YoY by 9% to US$464 million, from annual gold sales of 209,269 ounces, down 5%, at an average realised price of US$2,218/oz, up 15% YoY. Due to timing of gold shipments, a total of 22,381 ounces of unsold gold bullion was held at Sukari as at 30 June 2024, equivalent to US$52 million which has now been sold.

The Group adjusted EBITDA was US$211 million, at a 45% EBITDA margin and up 9% YoY, principally driven by

Profit before tax increased by 2% to US$117 million, due to:

The above factors together with an increase in EMRA distributions during the period resulted in basic EPS decreasing by 9% to 7.19 US cents.

COST MANAGEMENT

Cash costs of production in H1 2024 were US$220 million, a 17% increase YoY. This is primarily due to lower capitalisation of costs (discussed above), increased output from the underground and higher throughput in the plant. Unit cash costs of production were US$977/oz produced, a 15% increase, driven by the aforementioned cost drivers, partly offset by higher production volumes.

AISC in H1 2024 were US$289 million, a 7% increase YoY, and with lower sales volumes (due to timing of gold shipments) resulting in unit AISC of US$1,382/oz sold, a 13% increase YoY.  

STRONG FINANCIAL POSITION

As of 30 June 2024, Centamin had cash and liquid assets of US$200 million, including 22koz of gold inventory waiting to be sold. From a liquidity standpoint, the US$150 million sustainability-linked revolving credit facility remains available and undrawn. 

CAPITAL INVESTMENT

H1 2024 gross capital expenditure was US$89 million, including the underground ventilation upgrades, continued contracted waste-stripping programme, new underground and open pit equipment purchases, underground development, open pit equipment rebuilds, and raising TSF2.

Total sustaining capex was US$47 million, and non-sustaining was US$42 million. We had expected a higher capex spend in H1 but due to minor changes in scheduling, this has been moved to H2 2024 and we remain on track to meet 2024 guidance.

Interim dividend

Consistent with the Company's stated commitment to shareholder returns, the Board declares an interim dividend of 2.25 US cents per share (US$26 million) for the six-month period ended 30 June 2024. As per the dividend policy, this distribution is in line with the commitment to return a minimum of 30% of Group free cash flow before growth capex³ to shareholders in cash dividends. In consideration of the below factors, and reflecting the Board's confidence, a total of 53% of H1 2024 Group free cash flow before growth capex will be distributed to shareholders on 27 September 2024:

The interim dividend is calculated by the following:

1 Defined as Sukari growth capex funded from Treasury and available for cost-recovery as per the Concession Agreement.

2 Discretionary capital allocation options include future project investment, portfolio optimisation and supplemental shareholder returns

Please refer to the Dividend Declaration announcement and or the website (www.centamin.com/investors/shares-dividends/dividend-information/)  for further detail including the interim dividend timetable.

OUTLOOK

Financially, we expect a stronger second half of 2024 driven by higher production volumes. Meanwhile, our focus on cost management means we remain fully focused on managing the bottom line of the business so that we can maximise the value at Sukari whilst delivering growth and diversification alongside stakeholder returns.

ROSS JERRARD                                         

CFO

25 July 2024

primary statements highlights

Revenue from gold and silver sales for the period increased by 9% year-on-year to US$465 million (2023: US$426 million) with a 15% increase in the year-on-year average realised gold price to US$2,218 per ounce sold (2023: US$1,936 per ounce sold) offset by a 5% decrease in gold ounces sold to 209,269 ounces (2023: 219,354 ounces).

Cost of sales represents the cost of mining, processing, refining, transport, site administration, depreciation, amortisation and movement in production inventories. Cost of sales is up 10% year-on-year to US$295 million.

Profit share payments during the year are reconciled against SGM's audited financial statements. Any variation between payments made during the year (based on the Company's estimates) and the SGM's audited financial statements, may result in a balance due and payable to EMRA or advances to be offset against future distributions. SGM's 30 June 2023 financial statements have been audited and signed off; the 30 June 2024 financial statements will be audited in due course in line with the agreed timetable.

Certain terms of the Concession Agreement (CA) and amounts in the cost recovery model may also vary depending on interpretation and are therefore subject to continued discussions between EMRA and management which can result in variations in the profit-sharing split between periods. Centamin and EMRA continue working on closing outstanding open audit periods as well as agree on the timing and mechanism of any financing and ultimately the distribution of future proceeds between partners.

Refer to note 1.2.1.2 in the 2023 Annual Report for details of the treatment and disclosure of the EMRA profit share.

CAPITAL EXPENDITURE

The following table provides a breakdown of the total capital expenditure of the Group:

(1)   Non-sustaining capital expenditure included the spend on North dump leach pad expansion, tailings storage facility stage lifts and the Capital Waste Stripping. Non-sustaining costs are primarily those costs incurred at 'new operations' and costs related to 'major projects at existing operations' that will materially benefit the operation.

(2)   Reclassified from operating expenditure.

EXPLORATION EXPENDITURE

The following table provides a breakdown of the total exploration expenditure of the Group:

Exploration and evaluation expenditure comprises expenditure incurred for exploration activities primarily in Côte d'Ivoire and in the Egypt greenfield permit areas. Greenfield exploration and evaluation costs (excluding Burkina Faso) decreased by US$6 million or 33%, primarily driven by reduced work in Côte d'Ivoire as the Definitive Feasibility Study ("DFS") stage of the Doropo project has now been finalised. Drilling work was however significantly expanded in the new Egypt permit areas hence the 41% or US$0.9 million increase in the exploration costs in that area. The brownfield capitalised exploration costs on the Sukari concession area decreased by US$3 million or 41% year on year due to the decrease in the surface exploration and evaluation work and related activities within the Sukari concession areas.

The spend in Burkina Faso was mainly on key services and other regulatory obligations required to formally exit the country. The in country incorporated entities have now been formally liquidated.

SUBSEQUENT EVENTS

Interim dividend

The Directors have declared an interim dividend of 2.25 US cents per share on Centamin plc ordinary shares (totalling approximately US$26 million). The interim dividend for the half year period ended 30 June 2024 will be paid on 27 September 2024 to shareholders on the register on the Record Date of 30 August 2024.

Other than as noted above, there were no other significant events occurring after the reporting date requiring disclosure in the financial statements.

NON‑GAAP FINANCIAL MEASURES

1) EBITDA and adjusted EBITDA

EBITDA is a non‑GAAP financial measure, which excludes the following from profit before tax:

Management considers EBITDA a valuable indicator of the Group's ability to generate liquidity by producing operating cash flow to fund working capital needs and capital expenditures. EBITDA is also frequently used by investors and analysts for valuation purposes whereby EBITDA is multiplied by a factor or 'EBITDA multiple' that is based on an observed or inferred relationship between EBITDA and market values to determine a company's approximate total enterprise value. EBITDA is intended to provide additional information to investors and analysts and does not have any standardised definition under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

EBITDA excludes the impact of income from financing activities and taxes, and therefore is not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may also calculate EBITDA differently. The following table provides a reconciliation of EBITDA to profit for the year before tax.

Adjusted EBITDA removes the effect of transactions that are not core to the Group's main operations, like adjustments made to normalise earnings, for example profit on financial assets at fair value through profit or loss, impairments of property, plant and equipment, non-current mining stockpiles and exploration and evaluation assets.

Reconciliation of profit before tax to EBITDA and adjusted EBITDA:

(1)    Adjustments made to normalise earnings for example profit on financial assets at fair value through profit or loss, impairments of property, plant and equipment, non-current mining stockpiles and exploration and evaluation assets.

2) Cash cost of production per ounce produced and sold and all-in sustaining costs ("AISC") per ounce sold calculation

Cash cost of production and AISC are non-GAAP financial measures. Cash cost of production per ounce is a measure of the average cost of producing an ounce of gold, calculated by dividing the operating costs in a period by the total gold production over the same period. Operating costs represent total operating costs less sustaining administrative expenses, royalties, depreciation and amortisation. Management uses this measure internally to better assess performance trends for the Company as a whole. Management considers that, in addition to conventional measures prepared in accordance with GAAP, certain investors use such non-GAAP information to evaluate the Company's performance and ability to generate cash flows. Management considers that these measures provide an alternative reflection of the Group's performance for the current year and are an alternative indication of its expected performance in future periods. Cash cost of production is intended to provide additional information, does not have any standardised meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. This measure is not necessarily indicative of operating profit or cash flow from operations as determined under GAAP. Other companies may calculate these measures differently.

Reconciliation of cash cost of production per ounce produced:

1)      The movement in inventory on ounces produced is only the net movement in mining stockpiles and ore in circuit while the movement in ounces sold (in table below) is the net movement in mining stockpiles, ore in circuit and gold in safe inventory.

A reconciliation has been included below to show the cash cost of production metric should gold sold ounces be used as a denominator.

Reconciliation of cash cost of production per ounce sold:

(1)    The movement in ounces sold is the net movement in mining stockpiles, ore in circuit and gold in safe inventory while the movement in inventory on ounces produced (in table above) is only the net movement in mining stockpiles and ore in circuit while.

Reconciliation of AISC per ounce sold:

(1)    Includes refinery and transport.

3)   Cash and cash equivalents, bullion on hand and gold and silver sales debtor AND FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

Management considers that, in addition to conventional measures prepared in accordance with GAAP, certain investors use such non-GAAP information to evaluate the Company's performance and ability to generate cash flow and the measure is intended to provide additional information.

Cash and cash equivalents, bullion on hand, gold and silver sales debtor and financial assets at fair value through profit or loss is a non-GAAP financial measure of the available cash and liquid assets at a point in time. Management uses this measure internally to better assess performance trends for the Company as a whole.

This non-GAAP measure does not have any standardised meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. This measure is not necessarily indicative of cash and cash equivalents as determined under GAAP and other companies may calculate it differently.

Reconciliation to cash and cash equivalents, bullion on hand, gold and silver sales debtor and financial assets at fair value through profit or loss:

The majority of funds have been invested in international rolling short-term fixed interest money market deposits.

4) Free cash flow and adjusted free cash flow

Free cash flow is a non-GAAP financial measure. Free cash flow is a measure of the available cash after distributions to the Non-Controlling Interest ("NCI") in SGM, being EMRA, that the Group has at its disposal to use for capital reinvestment and to distribute to shareholders of the parent. Free cash flow is intended to provide additional information, does not have any standardised meaning prescribed by GAAP and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. This measure is not necessarily indicative of operating profit or cash flow from operations as determined under GAAP and other companies may calculate this measure differently.

(1)   Adjustments made to free cash flow, for example acquisitions and disposals of financial assets at fair value through profit or loss, which are completed through specific allocated available cash reserve

governanCe

Share Plan Awards

Granted 02 May 2024

PRINCIPAL RISKS AND Uncertainties

RISK MANAGEMENT

Centamin recognises that nothing is without risk. We believe a successful and sustainable business requires a robust and proactive risk management framework as its foundation. This is supported by a strong culture of risk awareness, encouraging openness and integrity, alongside a clearly defined appetite for risk. This enables the Company to consider risks and opportunities for more effective decision-making, delivery on our objectives and improve our performance as a responsible mining company. The Board has overall responsibility, supported by the Audit and Risk Committee, for establishing a framework that allows for the review of existing and emerging risks in the context of both opportunities and potential threats that inform the principal risks and uncertainties. These risks and opportunities inform the assessment of the future prospects and long-term viability of the Group, as shown in the Viability Statement of the 2023 Annual Report and are also considered when challenging the strategic objectives of the Company.  

2024 continues to provide macroeconomic change exacerbated by geopolitical pressures including the ongoing conflicts in Gaza, the Rea Sea and Ukraine. Whilst as a business we were able to successfully manage the operational considerations these have brought, we have felt the financial pressures as every government, business and individual has globally. The 2023 Annual Report included the latest updates to the principal and emerging risks driven by these pressures.

We continue to feel the ongoing global impact of these increased financial pressures, which we carry on monitoring, and has led to the introduction of additional mitigations and changes to our ongoing strategy for the financially focussed risks. When considering the healthy financial position of the business, including additional measures such as the revolving credit facility, means we feel there is sufficient financial flexibility to meet the Company's current and future financial commitments through 2024.

The Directors confirm that a robust assessment of the principal, new and emerging risks impacting the Company has been undertaken which identified external, strategic and operational risks on a sliding scale depending on the level of influence over which the Company may have on the factors which can impact the risk. For further detail please refer to the Risk Review within the 2023 Annual Report and 2023 Sustainability Report, published on the Company's website: www.centamin.com.

PRINCIPAL RISKS

The principal risks and uncertainties facing the Group remain unchanged from those which are set out in detail within the Strategic Report section of the 2023 Annual Report and can be found on the Company's website (https://www.centamin.com/investors/principal-risks-and-uncertainties/) .

The principal risks are listed below:

External risks

·      Geopolitical

·      Legal and regulatory compliance

·      Litigation

·      Global macroeconomic developments

·      Gold price

Strategic risks

·      Capital allocation and liquidity

·      Diversification

·      Concession governance and management

·      Licence to operate

·      People (attract, develop and retain skilled people)

·      Stakeholder environmental and social expectations

·      Decarbonisation

Operational risks

·      Safety, health and wellbeing

·      Exploration and project development

·      Maximising our geological potential

·      Operational performance and planning

EMERGING RISKS

Below we have outlined a list of emerging risks, these remain unchanged from those which are set out within the Strategic Report section of the 2023 Annual Report and website:

·      Cyber security

·      Infectious disease

·      Climate change

DIRECTORS' RESPONSIBILITY STATEMENT

RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE SIX MONTHS ENDED 30 JUNE 2024 FINANCIAL REPORT

The Directors confirm that to the best of their knowledge:

The board of Directors that served during all or part of the six month period ended on 30 June 2024 and their respective responsibilities can be found on pages 84 to 130 of the 2023 annual report and financial statements of Centamin plc. There has been no changes to board of Directors since the approval of the 2023 Annual Report.

By order of the Board,

Martin Horgan                                                              Ross Jerrard

CEO                                                                                       CFO

25 July 2024                                                                         25 July 2024        

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED

30 JUNE 2024