TIDMCUSN
RNS Number : 9136C
Cornish Metals Inc.
24 June 2021
CORNISH METALS RELEASES FINANCIAL STATEMENTS AND MANAGEMENT'S
DISCUSSION AND ANALYSIS FOR THE THREE MONTHSING 30 APRIL 2021
June 24, 2021
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 interim financial statements and
management, discussion and analysis ("MD&A") for the three
months ended 30 April 2021. 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, 2021 and for the
period ending June 23, 2021
-- Completion of listing and concurrent financing on AIM in
February 2021 raising gross proceeds of GBP8.2 million ($14.4
million based on closest available exchange rate) to advance the
United Downs exploration project and for general working capital
purposes;
-- Conversion of Osisko loan note in February 2021 into two
royalty agreements over mineral properties in Cornwall with an
accompanying simplified and reduced security package;
-- Agreements reached for the leasing of additional mineral
rights at the South Crofty tin project and surface land surrounding
the New Roskear Shaft, and binding heads of terms agreed for the
disposal of waste material derived from the dewatering of the South
Crofty mine;
-- Commencement of phased exploration program at the United
Downs exploration project in April 2021 to initially delineate
further the known mineralized structures and conduct in-fill
drilling;
-- Increases in Indicated Resource and Inferred Resource by
10.2% and 129.8%, respectively, for the Lower Mine in updated
Mineral Resource Estimate for South Crofty mine published in June
2021 (see news release dated June 9, 2021); and
-- Financing options continue to be considered to progress the South Crofty tin project.
Richard Williams, CEO of Cornish Metals, stated, "I am delighted
with what the Company has achieved in the last few months - a
highly successful listing on AIM which surpassed our expectations,
the conversion of the Osisko loan note into two royalties which
endorsed the quality of the Company's projects in Cornwall, a
substantial increase in mineral resource for South Crofty and the
commencement of the exploration programme at United Downs. I look
forward to reporting imminently on the initial results of that
exploration programme once the assays from the first few drill
holes have been assessed.
"Longer term, we are continuing to assess various financing
options to progress South Crofty which remains a key strategic
asset for the Company. South Crofty could potentially play a
pivotal role in securing a domestic and sustainable source of
battery metals as the UK transitions to a low carbon economy."
Key financial metrics for the first quarter
Three months ended
(Expressed in Canadian dollars) 30 April 2021 30 April 2020
-------------- --------------
Total operating expenses 894,549 401,968
-------------- --------------
Loss for the period 1,301,049 398,893
-------------- --------------
Net cash used in operating
activities 908,981 291,073
-------------- --------------
Net cash used in investing
activities 762,856 526,047
-------------- --------------
Net cash provided by financing
activities 13,226,816 1,119,335
-------------- --------------
Cash at end of the financial
period 11,511,900 1,609,018
-------------- --------------
Outlook
The proceeds from the recently completed AIM listing are to be
used to conduct a drill program at the United Downs exploration
project, to conduct initial field work on other high priority
exploration targets within transport distance of South Crofty, and
for general working capital purposes . Management believes that,
subject to drilling success, the proceeds from the AIM listing will
result in the Company being fully funded to the completion of a
maiden JORC resource at the United Downs exploration project.
Within 12 to 18 months of the date of the AIM listing, the
Company plans to:
-- Commence an 18 month 9,100 meter initial drilling program at
United Downs to advance the project to Inferred Mineral Resource
definition, fully funded from the proceeds arising from the AIM
listing;
-- Test three lodes with a 1,000 meter of strike length to a
depth of 500 meter in the initial phase. Management believes there
are up to seven further mineralized lode structures with a total
resource potential of between four million tons and ten million
tons;
-- Subject to the outcome of the initial drilling program,
undertake a subsequent in-fill drilling program at United Downs to
advance the project to a feasibility study within three years;
and
-- Evaluate other near-surface, high potential, exploration
targets within transport distance of the planned processing plant
site.
In the longer term, the Company intends to develop the South
Crofty tin project as and when economic conditions and cashflows
are supportive .
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.
For additional information please contact:
In North America:
Irene Dorsman at +1 (604) 200 6664 or by e-mail at
irene@cornishmetals.com
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
Blytheweigh
(Financial PR/IR-London) Tel: +44 207 138 3204
Tim Blythe tim.blythe@blytheweigh.com
Megan Ray megan.ray@blytheweigh.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 with respect to the
continued listing and trading of the Common Shares on the TSX-V and
AIM; and the expected commencement of future exploration programs
at the United Downs and the South Crofty Mine.
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; 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
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF FINANCIAL
POSITION
(Unaudited - Prepared by Management)
(Expressed in Canadian dollars)
April 30, 2021 January 31, 2021
------------------------------------------------------ ---------------------------- -----------------------------
ASSETS
Current
Cash $ 11,511,900 $ 353,601
Marketable securities 1,004,307 1,004,307
Receivables 71,038 23,644
Deferred financing fees - 688,839
Deferred costs on conversion of royalty option - 151,037
Prepaid expenses 226,126 41,691
12,813,371 2,263,119
Deposits 53,191 36,976
Property, plant and equipment 6,226,709 6,371,852
Exploration and evaluation assets 9,723,159 9,507,859
$ 28,816,430 $ 18,179,806
====================================================== ============================ =============================
LIABILITIES
Current
Accounts payable and accrued liabilities $ 594,062 $ 947,124
Lease liability 4,339 20,389
598,401 967,513
Lease liability 3,800 -
Debt - 5,993,803
Royalty option - 2,886,514
NSR liability 8,419,876 -
9,022,077 9,847,830
SHAREHOLDERS' EQUITY
Capital stock 53,849,099 40,737,065
Share subscriptions received in advance - 189,902
Capital contribution 2,007,665 2,007,665
Share-based payment reserve 898,008 846,212
Foreign currency translation reserve 28,526 239,028
Deficit (36,988,945) (35,687,896)
19,794,353 8,331,976
$ 28,816,430 $ 18,179,806
====================================================== ============================ =============================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF LOSS AND
COMPREHENSIVE LOSS
(Unaudited - Prepared by Management)
(Expressed in Canadian dollars)
Three months ended
April 30, April 30,
2021 2020
-------------------------------------------- ------------------- ------------------
EXPENSES
Accretion $ 15,764 $ 60,380
Advertising and promotion 52,925 49,874
Depreciation 22,109 22,388
Finance cost 3,895 4,545
Insurance 21,784 19,545
Office, miscellaneous and rent 21,883 11,159
Professional fees 412,674 49,939
Regulatory and filing fees 68,883 8,379
Share-based compensation 51,796 -
Salaries, directors' fees and benefits 222,836 175,759
Total operating expenses (894,549) (401,968)
Interest income 192 3,259
Foreign exchange loss (406,692) (184)
Loss for the period (1,301,049) (398,893)
Foreign currency translation (210,502) 34,435
Total comprehensive loss for the period $ (1,511,551) $ (364,458)
============================================ =================== ==================
Basic and diluted loss per share $ (0.01) $ (0.00)
Weighted average number of common shares
outstanding: 248,501,072 132,773,030
============================================ =================== ==================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited - Prepared by Management)
(Expressed in Canadian dollars)
For the three months
ended
April 30, April 30,
2021 2020
----------------------------------------------------------------- -------------------- -----------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period $ (1,301,049) $ (398,893)
Items not involving cash:
Accretion 15,764 60,380
Depreciation 22,109 22,388
Share-based compensation 51,796 -
Finance cost 3,895 4,545
Foreign exchange loss 406,692 184
Changes in non-cash working capital items:
Decrease (increase) in receivables (47,393) 1,858
Decrease (increase) in prepaid expenses (54,245) 24,316
Decrease in accounts payable and accrued liabilities (6,550) (5,851)
Net cash used in operating activities (908,981) (291,073)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment (75,671) (315,165)
Acquisition of exploration and evaluation assets (670,970) (210,821)
Increase in deposits (16,215) (61)
Net cash used in investing activities (762,856) (526,047)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from AIM listing 14,244,206 -
Proceeds from private placement financing - 1,177,500
Proceeds from warrant exercises 184,750 -
Share issue costs (1,066,126) (33,971)
Conversion of royalty option costs (111,730) -
Lease payments (24,284) (24,194)
Net cash provided by financing activities 13,226,816 1,119,335
Impact on foreign exchange on cash (396,680) 1,550
Change in cash during the period 11,158,299 303,765
Cash, beginning of the period 353,601 1,305,253
Cash, end of the period $ 11,511,900 $ 1,609,018
================================================================= ==================== =======================
Cash paid during the period for interest $ - $ -
================================================================= ==================== =======================
Cash paid during the period for income taxes $ - $ -
================================================================= ==================== =======================
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF CHANGES IN
SHAREHOLDERS' EQUITY
THREE MONTHS ENDED APRIL 30
(Unaudited - Prepared by Management)
(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
31, 2020 86,768,585 $ 37,271,686 $ 1,175,000 $ 2,007,665 $ 732,930 $ 149,996 $ (34,280,418) $ 7,056,859
Share issuance
pursuant
to private
placement
financing 47,050,000 2,352,500 (1,175,000) - - - - 1,177,500
Share issue
costs - (21,621) - - - - - (21,621)
Forfeiture of
stock
options - - - - (28,449) - 28,449 -
Foreign
currency
translation - - - - - 34,435 - 34,435
Loss for the
period - - - - - - (398,893) (398,893)
----------------- ------------ -------------- -------------- ------------- ------------ ------------ ----------------------- --------------
Balance at April
30, 2020 133,818,585 $ 39,602,565 $ - $ 2,007,665 $ 704,481 $ 184,431 $ (34,650,862) $ 7,848,280
----------------- ------------ -------------- -------------- ------------- ------------ ------------ ----------------------- --------------
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
----------------- ------------ -------------- -------------- ------------- ------------ ------------ ----------------------- --------------
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