Update: Management Team, Licensing and Electricity
Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining & Exploration
31 May 2023
('Goldplat' or the 'Company')
Update on senior management team, licensing and electricity
Goldplat Plc, (AIM: GDP) the AIM listed Mining Services Group, with international gold recovery operations located in South Africa and Ghana, servicing the African and South American Mining Industry, is pleased to provide an update on the strengthening of the Group management team, the finalisation of the renewal of Gold Recovery Ghana ("GRG") gold license and the electricity supply in South Africa.
During May, the Group appointed a Chief Operating Officer, Douglas Davidson, to focus specifically on improving and strengthening current operations. Douglas is a Metallurgical Engineer with 26 years of experience in the mining industry of which 23 years have been in the diamond industry, mainly in Namibia and Lesotho. Douglas Davidson has extensive operational experience built up in operating large plants for De Beers, Namdeb and Namakwa Diamonds. He has held various senior positions including Group Metallurgical Lead and Mine Manager at these companies as well as serving on the Executive Committee at Namdeb. He has led multi-disciplinary operational teams to identify, develop and implement value accretive and risk mitigating initiatives to improve overall business performance.
In Ghana, the renewal of GRG's gold license has been finalised and the export of product has started, but we expect that most of this material will only arrive at customers in July 2023. As a result, the sales will only be recognised in the next financial period.
The electricity shortages in South Africa continue and we have lost 28% of hours available during the first 2 months of Q4, compared to 20% in Q3, as a result. Due to the increased uncertainty of supply in the medium term, we have made a decision to invest in diesel generators which will be able to sustain operations in South Africa during electricity cuts. The capital cost of these investments will be GBP750,000 and will be financed over 36 months with one of our local banks. We estimate that it will take 12 - 14 weeks to receive and install these generators. Based on 25% of available hours expected to be lost during the next 24 months, we expect that the capital cost will be recovered within 24 months. During this period, we will also continue to investigate other options to secure electricity supply, for example additional connections to the local Municipality Grid or a new direct connection to Eskom (South Africa Electricity Generator and Supplier); however the timelines of these options remain uncertain and unclear.
Werner Klingenberg, CEO of Goldplat commented: "I am pleased with the appointment of Douglas as COO and believe that his operational strength will be extremely valuable in securing the current operations and production whilst we continue to look to investigate diversification and growth opportunities.
The delay in the gold license in Ghana impacted our ability to export and although we've experienced good production in Ghana, the margins will only be realised during the last 4 months of the year.
The diesel generators will not just reduce impact of electricity cuts, but also give control back to operational teams to improve efficiencies and maximise gold production and provide a sense of normality which we believe is important for the morale of our employees."
For further information, visit www.goldplat.com, follow on Twitter @GoldplatGDP or contact:
Tel: +27 (0) 82 051 1071
Colin Aaronson / George M Grainger
Grant Thornton UK LLP
Tel: +44 (0) 20 7383 5100
James Bavister / Andrew de Andrade
WH Ireland Limited
Tel: +44 (0) 207 220 1666
Tim Thompson / Mark Edwards / Fergus Mellon
Flagstaff Strategic and Investor Communications
Tel: +44 (0) 207 129 1474
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.