TIDMCUSN
RNS Number : 8802P
Cornish Metals Inc.
23 June 2022
CORNISH METALS RELEASES UNAUDITED FINANCIAL STATEMENTS AND
MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHSING 30
APRIL 2022
Vancouver, June 22, 2022
Cornish Metals Inc. (TSX-V/AIM: CUSN) ("Cornish Metals" or the
"Company"), a mineral exploration and development company focused
on its projects in Cornwall, United Kingdom, is pleased to announce
that it has released its unaudited financial statements and
management, discussion and analysis ("MD&A") for the three
months ended April 30, 2022. The reports are available under the
Company's profile on SEDAR ( www.sedar.com ) and on the Company's
website ( www.cornishmetals.com ).
Highlights for the three months ended April 30, 2022 and for the
period ending June 22, 2022
(All figures expressed in Canadian dollars unless otherwise
stated)
-- Completion of 10,159 meters of drilling within phased
exploration program at the United Downs exploration project with
results from first 3,927 meters of drilling reported to date, with
further assay results to be reported when available;
-- Completion of financing for gross proceeds of GBP40.5 million
($64.8 million based on closest available exchange rate) (the
"Offering"), including a strategic investment by Vision Blue
Resources of GBP25.0 million ($40.0 million), to advance the South
Crofty tin project ("South Crofty") to a potential construction
decision (news releases dated March 27, 2022 and May 23, 2022
);
-- Issuance of second tranche of common shares pursuant to the
restructuring of the deferred consideration relating to the
acquisition of the South Crofty tin project and associated mineral
rights (news release dated May 29, 2022 ); and
-- Mr. Tony Trahar nominated by Vision Blue Resources as its
representative on the Board (news release dated June 5, 2022 ).
Richard Williams, CEO of Cornish Metals, stated, "The completion
of the GBP40m financing including a strategic investment by Vision
Blue Resources last month opened a new chapter for the Company. As
soon as the funds were received at the end of May, we wasted no
time in starting to place orders for the new water treatment plant.
The first recruits to our newly formed projects team will be
joining us in the coming weeks and further appointments will be
made to our mining and geological teams to enhance their
capacities.
The next few months will be hard but rewarding work as we build
the required framework for strong and capable project execution. I
look forward to reporting on progress at South Crofty in due
course.
In the meantime, the backdrop for tin pricing in the medium to
long term remains favourable. Demand is expected to increase
further as electrification gathers pace, with supply constraints
showing no sign of abating."
Financial highlights for the three months ended April 30, 2022
and April 30, 2021
Three months ended (unaudited)
April 30, April 30,
2022 2021
----------------- --------------
(Expressed in Canadian dollars)
----------------- --------------
Total operating expenses 627,115 894,549
----------------- --------------
Loss for the period 979,427 1,301,049
----------------- --------------
Net cash (used in) operating activities (625,384) (908,981)
----------------- --------------
Net cash (used in) investing activities (1,184,673) (762,856)
----------------- --------------
Net cash (used in) / provided by
financing activities (555,449) 13,226,816
----------------- --------------
Cash at end of the period 4,286,535 11,511,900
----------------- --------------
-- Decrease in operating expenses impacted by $368,325 of costs
relating to AIM listing incurred in comparative period which were
not eligible for capitalization;
-- Higher operating expenses more generally relating to
increased media/investor activities following last year's AIM
listing and preparatory work for the successful fundraise
cornerstoned by Vision Blue Resources;
-- Costs of $576,786 and $230,723 capitalized in connection with
the ongoing exploration program at United Downs and Carn Brea,
respectively (excluding capitalized depreciation and other non-cash
items);
-- Financing fees of $584,359 incurred by April 30, 2022 in
connection with the fundraise which closed at the end of May
2022;
-- Gross proceeds raised from the Offering of GBP40.5 million
($64.8 million) received subsequent to the period end, following
gross proceeds raised from the AIM listing in comparative period of
GBP8.2 million ($14.4 million) (news release dated February 16,
2021 ); and
-- Recognition of foreign currency translation loss of
$1,152,758 for those assets located in the UK when translated into
Canadian dollars for presentational purposes .
Outlook
The proceeds raised from the Offering completed in May 2022 are
being used to advance the South Crofty tin project to a potential
construction decision within 30 months from closing of the
Offering. The planned use of the proceeds from the Offering is to
complete the dewatering program and Feasibility Study at South
Crofty, evaluate downstream beneficiation opportunities and
commence potential on-site early works in advance of a potential
construction decision .
Within 30 months from the closing of the Offering, the Company's
plans are as follows:
-- Construct the Water Treatment Plant ("WTP") in the first half
of 2023 and thereafter complete the dewatering of the mine within
18 months;
-- Complete an underground drill program which is expected to
commence in July 2022 in order to delineate a JORC compliant
Measured and Indicated Mineral Resource and increase the Indicated
and Inferred JORC Mineral Resource once access to the underground
workings is obtained;
-- Complete a Feasibility Study using all reasonable commercial
efforts on or before 31 December 2024;
-- Commence basic and detailed engineering studies, construction
of the processing plant, refurbishment of underground facilities
and other on-site early works; and
-- Evaluate downstream beneficiation opportunities in the UK and the rest of Europe.
Subject to the availability of financing, consideration will
also be given to continuing with the Company's exploration program
at United Downs and evaluating other near-surface, high potential,
exploration targets within transport distance of the planned
processing plant site at South Crofty .
ABOUT CORNISH METALS
Cornish Metals completed the acquisition of the South Crofty tin
and United Downs copper / tin projects, plus additional mineral
rights located in Cornwall, UK, in July 2016 (see Company news
release dated July 12, 2016 ). The additional mineral rights cover
an area of approximately 15,000 hectares and are distributed
throughout Cornwall. Some of these mineral rights cover old mines
that were historically worked for copper, tin, zinc, and
tungsten.
TECHNICAL INFORMATION
The technical information in this news release has been compiled
by Mr. Owen Mihalop. Mr. Mihalop has reviewed and takes
responsibility for the data and geological interpretation. Mr. Owen
Mihalop (MCSM, BSc (Hons), MSc, FGS, MIMMM, CEng) is Chief
Operating Officer for Cornish Metals Inc. and has sufficient
experience relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined under the
JORC Code (2012) and as a Qualified Person under NI 43-101. Mr.
Mihalop consents to the inclusion in this announcement of the
matters based on his information in the form and context in which
it appears.
For additional information please contact:
In North America:
Irene Dorsman at (604) 200 6664 or by e-mail at
irene@cornishmetals.com
In the UK:
SP Angel Corporate
Finance LLP
(Nominated Adviser
& Joint Broker) Tel: +44 203 470 0470
Richard Morrison
Charlie Bouverat
Grant Barker
Hannam & Partners
(Joint Broker) Tel: +44 207 907 8500
Matthew Hasson
Andrew Chubb
Ernest Bell
BlytheRay
(Financial PR/IR-London) Tel: +44 207 138 3204
Tim Blythe tim.blythe@blytheray.com
Megan Ray megan.ray@blytheray.com
ON BEHALF OF THE BOARD OF DIRECTORS
"Richard D. Williams"
Richard D. Williams, P.Geo
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Caution regarding forward looking statements
This news release contains "forward-looking statements"
including, but not limited to, statements in connection with the
expected use of proceeds of the Offering, including in respect of
certain work programs, expected construction, including in respect
of the WTP, and the potential completion of a Feasibility Study on
the South Crofty mine and the timing thereof, the exploration
program at United Downs and other exploration opportunities
surrounding the South Crofty tin project, expected recruitment of
various personnel, and expectations respecting tin pricing and
other economic factors. Forward-looking statements, while based on
management's best estimates and assumptions at the time such
statements are made, are subject to risks and uncertainties that
may cause actual results to be materially different from those
expressed or implied by such forward-looking statements, including
but not limited to: risks related to receipt of regulatory
approvals, risks related to general economic and market conditions;
risks related to the COVID-19 global pandemic and any variants of
COVID-19 which may arise; risks related to the availability of
financing when required and on terms acceptable to the Company and
the potential consequences if the Company fails to obtain any such
financing, such as a potential disruption of the Company's
exploration program(s); the timing and content of upcoming work
programs; actual results of proposed exploration activities;
possible variations in Mineral Resources or grade; failure of
plant, equipment or processes to operate as anticipated; accidents,
labour disputes, title disputes, claims and limitations on
insurance coverage and other risks of the mining industry; changes
in national and local government regulation of mining operations,
tax rules and regulations.
Although Cornish Metals has attempted to identify important
factors that could cause actual results to differ materially from
those contained in forward-looking statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove
to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. Cornish Metals undertakes no obligation or
responsibility to update forward-looking statements, except as
required by law.
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by
the Company to constitute inside information pursuant to Article 7
of EU Regulation 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 as amended.
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF FINANCIAL
POSITION
(Unaudited)
(Expressed in Canadian dollars)
April 30,
2022 January 31, 2022
------------------------------------------------- ----------------------- ----------------------------
ASSETS
Current
Cash $ 4,286,535 $ 6,922,704
Marketable securities 1,574,506 1,574,506
Receivables 140,449 107,230
Deferred financing fees 672,778 -
Prepaid expenses 353,680 231,933
7,027,948 8,836,373
Deposits 52,959 42,448
Property, plant and equipment 6,128,901 6,437,175
Exploration and evaluation assets 21,175,960 20,772,029
$ 34,385,768 $ 36,088,025
================================================= ======================= ============================
LIABILITIES
Current
Accounts payable and accrued liabilities $ 929,675 $ 613,178
Lease liability 3,594 4,204
Commitment to issue shares 6,076,200 6,041,525
7,009,469 6,658,907
Lease liability - 667
NSR liability 8,767,363 8,717,330
15,776,832 15,376,904
SHAREHOLDERS' EQUITY
Capital stock 56,846,350 56,846,350
Share subscriptions received in advance 30,000 -
Capital contribution 2,007,665 2,007,665
Share-based payment reserve 630,265 630,265
Foreign currency translation reserve (1,326,881) (174,123)
Deficit (39,578,463) (38,599,036)
18,608,936 20,711,121
$ 34,385,768 $ 36,088,025
================================================= ======================= ============================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF LOSS AND
COMPREHENSIVE LOSS
(Unaudited)
(Expressed in Canadian dollars)
Three months ended
April 30, April 30,
2022 2021
-------------------------------------------- -------------------- -------------------
EXPENSES
Accretion $ - $ 15,764
Advertising and promotion 110,878 52,925
Depreciation 443 22,109
Finance cost - 3,895
Insurance 33,509 21,784
Office, miscellaneous and rent 28,978 21,883
Professional fees 169,597 412,674
Generative exploration costs 333 -
Regulatory and filing fees 21,244 68,883
Share-based compensation - 51,796
Salaries, directors' fees and benefits 262,133 222,836
Total operating expenses (627,115) (894,549)
Interest income 743 192
Foreign exchange loss (353,055) (406,692)
Loss for the period (979,427) (1,301,049)
Foreign currency translation (1,152,758) (210,502)
Total comprehensive loss for the period $ (2,132,185) $ (1,511,551)
============================================ ==================== ===================
Basic and diluted loss per share $ (0.01) $ (0.01)
Weighted average number of common shares
outstanding: 285,850,157 248,501,072
============================================ ==================== ===================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)
(Expressed in Canadian dollars)
For the three months
ended
April 30, April 30,
2022 2021
---------------------------------------------------------------- ----------------------- -----------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period $ (979,427) $ (1,301,049)
Items not involving cash:
Accretion - 15,764
Depreciation 443 22,109
Share-based compensation - 51,796
Finance cost - 3,895
Foreign exchange loss 353,055 406,692
Changes in non-cash working capital items:
Increase in receivables (33,218) (47,393)
Increase in prepaid expenses (28,727) (54,245)
Increase (decrease) in accounts payable and accrued
liabilities 62,490 (6,550)
Net cash used in operating activities (625,384) (908,981)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment (2,661) (75,671)
Acquisition of exploration and evaluation assets (1,171,500) (670,970)
Increase in deposits (10,512) (16,215)
Net cash used in investing activities (1,184,673) (762,856)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from AIM listing - 14,244,206
Proceeds from fundraising received in advance 30,000 -
of share issue
Proceeds from warrant exercises - 184,750
Share issue costs - (1,066,126)
Increase in deferred financing fees (584,359) -
Conversion of royalty option costs - (111,730)
Lease payments (1,090) (24,284)
Net cash provided by (used in) financing activities (555,449) 13,226,816
Impact of foreign exchange on cash (270,663) (396,680)
Change in cash during the period (2,636,169) 11,158,299
Cash, beginning of the period 6,922,704 353,601
Cash, end of the period $ 4,286,535 $ 11,511,900
================================================================ ======================= =======================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF CHANGES IN
SHAREHOLDERS' EQUITY
(Unaudited)
(Expressed in Canadian dollars)
Share Foreign
subscriptions Share-based currency
Number received Capital payment translation
of shares Amount in advance contribution reserve reserve Deficit Total
---------------- ------------ -------------- -------------- ------------- ------------ ------------- ----------------------- -------------
Balance at
January $ ( 35,687,896
31, 2021 149,918,585 $ 40,737,065 $ 189,902 $ 2,007,665 $ 846,212 $ 239,028 ) $ 8,331,976
Share
issuance
pursuant
to
AIM
listing 117,226,572 14,434,108 (189,902) - - - - 14,244,206
Share issue
costs - (1,506,824) - - - - - (1,506,824)
Warrant
exercises 2,275,000 184,750 - - - - - 184,750
Share-based
compensation - - - - 51,796 - - 51,796
Foreign
currency
translation - - - - - (210,502) - (210,502)
Loss for the
period - - - - - - (1,301,049) (1,301,049)
---------------- ------------ -------------- -------------- ------------- ------------ ------------- ----------------------- -------------
Balance at
April
30, 2021 269,420,157 $ 53 ,849,099 $ - $ 2,007,665 $ 898,008 $ 28,526 $ (36,988,945) $ 19,794,353
---------------- ------------ -------------- -------------- ------------- ------------ ------------- ----------------------- -------------
Balance at
January $ ( 38,599,036
31, 2022 285,850,157 $ 56,846,350 $ - $ 2,007,665 $ 630,265 $ (174,123) ) $ 20,711,121
Commitment
to issue
shares
pursuant
to the
Offering - - 30,000 - - - - 30,000
Foreign
currency
translation - - - - - (1,152,758) - (1,152,758)
Loss for the
period - - - - - - (979,427) (979,427)
---------------- ------------ -------------- -------------- ------------- ------------ ------------- ----------------------- -------------
Balance at
April
30, 2022 285,850,157 $ 56 ,846,350 $ 30,000 $ 2,007,665 $ 630,265 $(1,326,881) $ (39,578,463) $ 18,608,936
---------------- ------------ -------------- -------------- ------------- ------------ ------------- ----------------------- -------------
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