ENDEAVOUR MINING PLC Delivering sustainable value
Endeavour Mining plc
Condensed Interim Consolidated
Financial Statements
For the three months ended 31 March 2024 and 2023
Expressed in Millions of United States Dollars
Q1 Q2 Q3 Q4
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
CONTENTS
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS | ||
CONSOLIDATED STATEMENT OF (LOSS)/EARNINGS | ||
CONSOLIDATED STATEMENT OF CASH FLOWS | ||
CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | ||
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
1 | DESCRIPTION OF BUSINESS AND NATURE OF OPERATIONS | |
2 | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
3 | DIVESTITURES | |
4 | EARNINGS FROM OPERATIONS | |
5 | SHARE CAPITAL | 10 |
6 | FINANCIAL INSTRUMENTS AND RELATED RISKS | 13 |
7 | LONG-TERMDEBT | 17 |
8 | TRADE AND OTHER RECEIVABLES | 19 |
9 | INVENTORIES | 20 |
10 | MINING INTERESTS | 21 |
11 | OTHER FINANCIAL ASSETS | 22 |
12 | TRADE AND OTHER PAYABLES | 23 |
13 | OTHER FINANCIAL LIABILITIES | 23 |
14 | NON-CONTROLLINGINTERESTS | 24 |
15 | SUPPLEMENTARY CASH FLOW INFORMATION | 24 |
16 | INCOME TAXES | 26 |
17 | SEGMENTED INFORMATION | 27 |
18 | COMMITMENTS AND CONTINGENCIES | 28 |
19 | SUBSEQUENT EVENTS | 29 |
1
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED INTERIM CONSOLIDATED STATEMENT OF (LOSS)/EARNINGS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED | |||
31 March | 31 March | ||
Note | 2024 | 2023 | |
Revenues | |||
Revenue | 4 | 472.7 | 481.2 |
Cost of sales | |||
Operating expenses | (199.9) | (171.4) | |
Depreciation and depletion | (108.7) | (101.9) | |
Royalties | (33.9) | (29.7) | |
Earnings from mine operations | 130.2 | 178.2 | |
Corporate costs | 4 | (10.5) | (13.5) |
Other expense | 4 | (16.6) | (5.1) |
Share-based compensation | 5 | (3.8) | (8.4) |
Exploration costs | (5.4) | (12.5) | |
Earnings from operations | 93.9 | 138.7 | |
Other expense | |||
Loss on financial instruments | 6 | (46.2) | (72.0) |
Finance costs, net | 7 | (23.4) | (14.9) |
Earnings before taxes | 24.3 | 51.8 | |
Income tax expense | 16 | (33.6) | (36.4) |
Net (loss)/earnings from continuing operations | (9.3) | 15.4 | |
Net earnings from discontinued operations | 3 | - | 5.0 |
Total (loss)/earnings and total comprehensive (loss)/earnings | (9.3) | 20.4 | |
Net (loss)/earnings from continuing operations attributable to: | |||
Shareholders of Endeavour Mining plc | (20.2) | (0.6) | |
Non-controlling interests | 14 | 10.9 | 16.0 |
(9.3) | 15.4 | ||
Total (loss)/earnings attributable to: | |||
Shareholders of Endeavour Mining plc | (20.2) | 3.8 | |
Non-controlling interests | 14 | 10.9 | 16.6 |
(9.3) | 20.4 | ||
(Loss)/Earnings per share from continuing operations | |||
Basic (loss)/earnings per share | 5 | (0.08) | 0.00 |
Diluted (loss)/earnings per share | 5 | (0.08) | 0.00 |
(Loss)/Earnings per share | |||
Basic (loss)/earnings per share | 5 | (0.08) | 0.02 |
Diluted (loss)/earnings per share | 5 | (0.08) | 0.02 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
2
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS)
THREE MONTHS ENDED | |||
31 March | 31 March | ||
Note | 2024 | 2023 | |
Operating activities | |||
Earnings before taxes | 24.3 | 51.8 | |
Non-cash items | 15 | 183.5 | 197.0 |
Cash paid on settlement of DSUs and PSUs | (2.9) | (4.4) | |
Cash paid on settlement of financial instruments | (16.2) | (1.2) | |
Income taxes paid | (51.3) | (24.4) | |
Operating cash flows before changes in working capital | 137.4 | 218.8 | |
Changes in working capital | 15 | (82.3) | (28.2) |
Operating cash flows generated from continuing operations | 55.1 | 190.6 | |
Operating cash flows generated from discontinued operations | 3 | - | 15.0 |
Cash generated from operating activities | 55.1 | 205.6 | |
Investing activities | |||
Expenditures on mining interests | 15 | (179.0) | (181.3) |
Changes in other assets | (13.3) | (1.8) | |
Sale of marketable securities | 11 | 4.8 | - |
Investing cash flows used by continuing operations | (187.5) | (183.1) | |
Investing cash flows used by discontinued operations | 3 | - | (17.2) |
Cash used in investing activities | (187.5) | (200.3) | |
Financing activities | |||
Acquisition of shares in share buyback | 5 | (16.8) | (10.9) |
Payments from the settlement of tracker shares | 13 | (0.2) | (12.3) |
Receipts on exercise of options and warrants | - | 5.9 | |
Dividends paid to minority shareholders | 14 | (4.9) | (6.7) |
Dividends paid to shareholders | 5 | (100.0) | (101.4) |
Proceeds of long-term debt | 7 | 219.3 | 360.0 |
Repayment of long-term debt | 7 | - | (330.0) |
Payment of financing fees and other | (4.0) | (8.6) | |
Repayment of lease liabilities | (5.7) | (4.2) | |
Settlement of contingent consideration | 13 | - | (46.3) |
Financing cash flows generated from/(used by) continuing operations | 87.7 | (154.5) | |
Financing cash flows used by discontinued operations | 3 | - | (1.2) |
Cash generated from/(used by) financing activities | 87.7 | (155.7) | |
Effect of exchange rate changes on cash and cash equivalents | (11.5) | 9.0 | |
Decrease in cash and cash equivalents | (56.2) | (141.4) | |
Cash and cash equivalents, beginning of period | 517.2 | 951.1 | |
Cash and cash equivalents, end of period | 461.0 | 809.7 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
3
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS)
As at | As at | ||
31 March | 31 December | ||
Note | 2024 | 2023 | |
ASSETS | |||
Current | |||
Cash and cash equivalents | 461.0 | 517.2 | |
Trade and other receivables | 8 | 283.5 | 269.2 |
Inventories | 9 | 249.9 | 224.9 |
Current portion of other financial assets | 11 | 72.3 | 69.7 |
Prepaid expenses and other | 40.2 | 39.2 | |
1,106.9 | 1,120.2 | ||
Non-current | |||
Mining interests | 10 | 4,236.0 | 4,157.1 |
Goodwill | 134.4 | 134.4 | |
Other financial assets | 11 | 130.2 | 123.2 |
Inventories | 9 | 330.0 | 323.6 |
Total assets | 5,937.5 | 5,858.5 | |
LIABILITIES | |||
Current | |||
Trade and other payables | 12 | 368.2 | 406.9 |
Lease liabilities | 15.0 | 14.3 | |
Current portion of debt | 7 | 23.1 | 8.5 |
Other financial liabilities | 13 | 28.3 | 17.5 |
Income taxes payable | 151.3 | 166.2 | |
585.9 | 613.4 | ||
Non-current | |||
Lease liabilities | 33.6 | 27.9 | |
Long-term debt | 7 | 1,281.3 | 1,059.9 |
Other financial liabilities | 13 | 40.7 | 29.8 |
Environmental rehabilitation provision | 116.2 | 115.1 | |
Deferred tax liabilities | 457.2 | 464.1 | |
Total liabilities | 2,514.9 | 2,310.2 | |
EQUITY | |||
Share capital | 5 | 2.5 | 2.5 |
Share premium | 50.7 | 50.7 | |
Other reserves | 5 | 584.7 | 594.3 |
Retained earnings | 2,455.9 | 2,578.0 | |
Equity attributable to shareholders of Endeavour Mining plc | 3,093.8 | 3,225.5 | |
Non-controlling interests | 14 | 328.8 | 322.8 |
Total equity | 3,422.6 | 3,548.3 | |
Total equity and liabilities | 5,937.5 | 5,858.5 | |
Registered No. 13280545 | |||
COMMITMENTS AND CONTINGENCIES (NOTE 18) | |||
SUBSEQUENT EVENTS (NOTE 19) | |||
Approved by the Board: 1 May 2024 | |||
/s/Ian Cockerill | /s/Alison Baker | ||
Director | Director |
The accompanying notes are an integral part of these consolidated financial statements.
4
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS)
SHARE CAPITAL | ||||||||
Share | Other | Total | Non-Controlling | |||||
Share | Premium | Reserves | Retained | Attributable to | Interests | |||
Note | Capital1 | Reserve | (Note 5) | Earnings | Shareholders | (Note 14) | Total | |
At 1 January 2023 | 2.5 | 25.6 | 592.4 | 3,040.4 | 3,660.9 | 426.4 | 4,087.3 | |
Settlement of convertible bond | 5 | - | 19.2 | - | - | 19.2 | - | 19.2 |
Purchase and cancellation of own | ||||||||
shares | 5 | - | - | - | (10.9) | (10.9) | - | (10.9) |
Share-based compensation | 5 | - | - | 2.3 | - | 2.3 | - | 2.3 |
Dividends paid | 5 | - | - | - | (101.4) | (101.4) | - | (101.4) |
Shares issued on exercise of options | ||||||||
and PSUs | - | 5.9 | (15.1) | 12.9 | 3.7 | - | 3.7 | |
Total net and comprehensive earnings | - | - | - | 3.8 | 3.8 | 16.6 | 20.4 | |
At 31 March 2023 | 2.5 | 50.7 | 579.6 | 2,944.8 | 3,577.6 | 443.0 | 4,020.6 | |
At 1 January 2024 | 2.5 | 50.7 | 594.3 | 2,578.0 | 3,225.5 | 322.8 | 3,548.3 | |
Purchase and cancellation of own | ||||||||
shares | 5 | - | - | - | (12.6) | (12.6) | - | (12.6) |
Shares issued on exercise of options | ||||||||
and PSUs | - | - | (12.8) | 10.7 | (2.1) | - | (2.1) | |
Share-based compensation | 5 | - | - | 3.2 | - | 3.2 | - | 3.2 |
Dividends paid | 5 | - | - | - | (100.0) | (100.0) | - | (100.0) |
Dividends to non-controlling interests | 14 | - | - | - | - | - | (4.9) | (4.9) |
Total net and comprehensive (loss)/ | ||||||||
earnings | - | - | - | (20.2) | (20.2) | 10.9 | (9.3) | |
At 31 March 2024 | 2.5 | 50.7 | 584.7 | 2,455.9 | 3,093.8 | 328.8 | 3,422.6 |
1. Changes to share capital occurred, however is presented as zero due to the nominal amount of the change and due to all USD amounts rounded to millions.
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
5
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS, EXCEPT PER SHARE AMOUNTS)
1 DESCRIPTION OF BUSINESS AND NATURE OF OPERATIONS
Endeavour Mining plc (the "Company"), together with its subsidiaries (collectively, "Endeavour" or the "Group"), is a publicly listed gold mining company that operates four mines in West Africa in addition to having project development and exploration assets. Endeavour is focused on effectively managing its existing assets to maximise cash flows as well as pursuing organic and strategic growth opportunities that benefit from its management and operational expertise.
Endeavour's corporate office is in London, England, and its shares are listed on the London Stock Exchange ("LSE") (symbol EDV), and on the Toronto Stock Exchange ("TSX") (symbol EDV) and quoted in the United States on the OTCQX International (symbol EDVMF). The Company is incorporated in the United Kingdom and its registered office is located at 5 Young Street, London, United Kingdom, W8 5EH.
2 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
a. STATEMENT OF COMPLIANCE
These condensed interim consolidated financial statements ("interim financial statements") have been prepared in accordance with UK adopted International Accounting Standard ("IAS") 34, Interim Financial Reporting and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority ('DTR'). In addition to preparing interim financial statements in accordance with UK adopted International Accounting Standard 34, "Interim Financial Reporting", the Company has also applied International Accounting Standard 34, "Interim Financial Reporting" as issued by the International Accounting Standards Board ("IASB"). These interim financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards ("IFRS") and UK adopted international accounting standards, and do not include all of the information required for full annual financial statements prepared using IFRS . These interim financial statements represent a 'condensed set of financial statements' as referred to in the DTR. The annual consolidated financial statements of the Group for the year ended 31 December 2023 ("annual financial statements") were prepared in accordance with UK adopted International Accounting Standards and International Financial Reporting Standards as issued by the IASB.
These interim financial statements for the three months ended 31 March 2024 were authorised for issue in accordance with a resolution of the Board on 1 May 2024. The interim financial statements are unaudited and do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. These interim financial statements should be read in conjunction with the annual financial statements of the Company for the year ended 31 December 2023, which include information necessary or useful to understanding the Company's operations, financial performance, and financial statement presentation. In particular, the Company's significant accounting policies were presented as note 2 to the annual financial statements and have been consistently applied in the preparation of these interim financial statements.
The comparative financial information for the year ended 31 December 2023 in this interim report does not constitute statutory accounts for that year. The statutory accounts for 31 December 2023 were delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
None of the new standards or amendments to standards and interpretations applicable during the period has had a material impact on the financial position or performance of the Group. The Group has not early adopted any standard, interpretation or amendment that was issued but is not yet effective.
b. BASIS OF PREPARATION
These interim financial statements have been prepared on the historical cost basis, except for certain financial instruments that are measured at fair value at the end of each reporting period. The Company's accounting policies have been applied consistently to all periods in the preparation of these interim financial statements. In preparing the Company's interim financial statements for the three months ended 31 March 2024, the Company consistently applied the critical judgments and estimates as disclosed in note 3 of its annual financial statements for the year ended 31 December 2023.
These interim financial statements include the accounts of the Company and its subsidiaries. Subsidiaries are entities controlled by the Company, which is defined as having the power over the entity, rights to variable returns from its involvement with the entity, and the ability to use its power to affect the amount of returns. All intercompany transactions and balances are eliminated on consolidation.
The Company's subsidiaries at 31 March 2024 are consistent with the subsidiaries as at 31 December 2023 as disclosed in note 22 to the annual financial statements, except for Taurus Gold Afema Gold Holdings Ltd, Afema Gold SA and Tauraus Gold SARL which were sold to Turaco Gold Limited during the period.
6
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS, EXCEPT PER SHARE AMOUNTS)
The Company's material operating subsidiaries at 31 March 2024 are as follows:
Proportion of ownership interest | ||||
and voting power held | ||||
Principal | Place of incorporation | 31 March | 31 December | |
Entity | activity | and operation | 2024 (%) | 2023 (%) |
Houndé Gold Operations S.A. | Gold Operations | Burkina Faso | 90 | 90 |
Semafo Burkina Faso S.A. ("Mana") | Gold Operations | Burkina Faso | 90 | 90 |
Société des Mines d'Ity S.A. | Gold Operations | Côte d'Ivoire | 85 | 85 |
Société des Mines de Lafigué SA | Development projects | Côte d'Ivoire | 80 | 80 |
La Mancha Côte d'Ivoire SàRL | Exploration | Côte d'Ivoire | 100 | 100 |
Sabodala Gold Operations SA | Gold Operations | Senegal | 90 | 90 |
c. GOING CONCERN
The Board of Directors have performed an assessment of whether the Company and Group would be able to continue as a going concern until at least May 2025. In their assessment, the Group has taken into account its financial position, expected future trading performance, its debt and other available credit facilities, future debt servicing requirements, its working capital and capital expenditure commitments and forecasts.
At 31 March 2024, the Group's net debt position was $830.5 million, calculated as the difference between the current and non-current portion of long-term debt with a principal outstanding of $1,291.5 million and cash of $461.0 million. The Group had current assets of $1,106.9 million and current liabilities of $585.9 million representing a total working capital balance (current assets less current liabilities) of $521.0 million as at 31 March 2024. Cash flows from continuing operating activities for the three months ended 31 March 2024 were inflows of $55.1 million.
Based on a detailed cash flow forecast prepared by management, in which it included any reasonable possible change in the key assumptions on which the cash flow forecast is based, the Board of Directors have a reasonable expectation that the Group will have adequate resources to continue in operational existence until at least May 2025 and that at this point in time there are no material uncertainties regarding going concern. Key assumptions underpinning this forecast include consensus analyst gold prices, production volumes in line with annual guidance and the timing and quantum of upstream dividends.
The Board of Directors is satisfied that the going concern basis of accounting is an appropriate assumption to adopt in the preparation of the interim financial statements as at and for the period ended 31 March 2024.
3 DIVESTITURES
a. DIVESTITURE OF BOUNGOU AND WAHGNION
On 30 June 2023, the Group completed the sale of its 90% interest in the Boungou and Wahgnion cash-generating units ("the disposal group") to Lilium Mining ("Lilium"). The total consideration upon sale of the disposal group included (i) $133.1 million cash consideration to be received by 31 July 2023; (ii) $25.0 million in deferred cash consideration payable in two instalments of $10.0 million and $15.0 million by the end of Q4-2023 and the end of Q1-2024, respectively; (iii) deferred cash consideration comprised of 50% of the net free cash flow generated by the Boungou mine until $55.0 million has been paid, which was expected to occur by Q4-2024 based on the gold price environment and mine plan at the time of the divestiture; (iv) a net smelter royalty ("NSR") on Boungou commencing immediately for 4% of gold sold; and (v) a NSR on Wahgnion commencing immediately for 4% of gold sold.
The fair value of the various aspects of the consideration at the transaction closing date were as follows (all of which, except for the cash and the $25.0 million in deferred cash consideration which is not linked to the net free cash flow generated, are classified as Level 3 fair value measurements):
- The fair value of the cash consideration receivable by 31 July 2023 was determined to be $133.1 million and $33.6 million was received by 31 December 2023.
- The fair value of deferred cash consideration payable in two instalments by Q4-2023 and Q1-2024, respectively, was determined to be $23.9 million.
- The fair value of the deferred cash consideration, payable on a quarterly basis, based on net free cash flow generated at the Boungou mine, was determined using a discounted cash flow, which resulted in a fair value of $50.8 million.
- The fair value of the NSR was estimated using probability-weighted scenarios with respect to discounted cash flow models for future production that might exceed the Boungou and Wahgnion reserves at 1 January 2023. Based on the various scenarios considered, the fair value of the NSR was $77.4 million.
At 31 March 2024, the carrying amounts of the cash consideration and deferred cash consideration payable, which are included in consideration receivable (note 8), were $81.4 million and $20.6 million, respectively (31 December 2023 - $85.4 million and $21.0 million respectively). Due to the amounts payable being past due, the Group has recognised a provision for expected credit losses of $18.0 million (31 December 2023 - $18.7 million).
7
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS, EXCEPT PER SHARE AMOUNTS)
At 31 March 2024, the fair values of the deferred cash consideration and the NSR, which are included in other financial assets (note 11) were $46.1 million and $48.6 million, respectively (31 December 2023 - $47.9 million and $49.3 million respectively). For the three months ended 31 March 2024, $1.4 million was accrued to be invoiced to Lilium and transferred to trade and other receivables and remained outstanding as at 31 March 2024. For the full year of 2023, $5.5 million of the NSR was invoiced to Lilium and transferred to trade and other receivables and $3.3 million was received. The total balance outstanding as at 31 March 2024 within trade and other receivables is $3.4 million, net of expected credit losses (31 December 2023 - $2.2 million).
The Group recognised a loss on disposal of $177.8 million, net of tax, calculated as follows:
At 30 June | ||
2023 | ||
Cash consideration | 133.1 | |
Deferred cash consideration | 23.9 | |
Deferred consideration | 50.8 | |
Net smelter royalties | 77.4 | |
Transaction costs | (1.3) | |
Total proceeds | 283.9 | |
Cash and cash equivalents | 20.2 | |
Restricted cash | 12.3 | |
Trade and other receivables | 28.6 | |
Prepaid expenses and other | 18.9 | |
Inventories | 59.0 | |
Mining interests | 558.6 | |
Other long term assets | 15.0 | |
Total assets | 712.6 | |
Trade and other payables | (62.6) | |
Other liabilities | (122.0) | |
Total liabilities | (184.6) | |
Net assets | 528.0 | |
Non-controlling interests | (66.3) | |
Net assets attributable to Endeavour | 461.7 | |
Loss on disposal | (177.8) | |
The earnings and loss for the disposal group was as follows: | ||
THREE MONTHS ENDED | ||
31 March | 31 March | |
2024 | 2023 | |
Revenue | - | 109.5 |
Operating costs | - | (62.9) |
Depreciation and depletion | - | (28.5) |
Royalties | - | (7.2) |
Other expense | - | (2.7) |
Earnings before taxes | - | 8.2 |
Deferred and current income tax expense | - | (3.2) |
Net earnings from discontinued operations | - | 5.0 |
Attributable to: | ||
Shareholders of Endeavour Mining plc | - | 4.4 |
Non-controlling interest | - | 0.6 |
Total earnings from discontinued operations | - | 5.0 |
Earnings per share from discontinued operations | ||
Basic | - | 0.02 |
Diluted | - | 0.02 |
8
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(EXPRESSED IN MILLIONS OF UNITED STATES DOLLARS, EXCEPT PER SHARE AMOUNTS)
The cash flows from the CGU were as follows:
THREE MONTHS ENDED | ||
31 March | 31 March | |
2024 | 2023 | |
Operating cash flows | - | 15.0 |
Investing cash flows | - | (17.2) |
Financing cash flows | - | (1.2) |
Total cash flows from the disposal group included in cash flows from discontinued | (3.4) | |
operations | - |
b. DIVESTITURE OF KARMA
On 10 March 2022, the Group completed the sale of its 90% interest in the Karma mine cash-generating unit ("CGU") to Néré Mining SA ("Néré"). The total consideration of $20.0 million upon sale of the Karma mine included (i) a deferred cash payment of $5.0 million to be paid six months after closing of the transaction subject to certain conditions being met; (ii) a contingent payment of up to $10.0 million payable twelve months after closing, based on a sliding scale, linked to the average gold price; and (iii) a 2.5% NSR on all ounces produced by the Karma mine in excess of 160,000 ounces of recovered gold from 1 January 2022.
At 31 March 2024, the fair value of the contingent consideration was unchanged at $5.0 million (note 8), the fair value of the NSR was $6.6 million (31 December 2023 - $6.6 million) (note 11) and the fair value of the deferred cash consideration, net of expected credit losses was nil (31 December 2023 - nil).
Refer to the annual financial statements of the Company for the year ended 31 December 2023 in relation to related party transaction disclosure concerning the former President and Chief Executive Officer, Mr de Montessus and One Continent Investments Limited ("OCI"), a 49% shareholder in Néré contained in note 22.
4 EARNINGS FROM OPERATIONS
The following tables summarise the significant components of earnings from operations. a. REVENUE
THREE MONTHS ENDED | |||
31 March | 31 March | ||
Note | 2024 | 2023 | |
Gold revenue | 469.9 | 479.2 | |
Silver revenue | 2.8 | 2.0 | |
Revenue | 17 | 472.7 | 481.2 |
The Group is not economically dependent on a limited number of customers for the sale of gold because gold can be sold to and through numerous banks and commodity market traders worldwide.
b. CORPORATE COSTS
THREE MONTHS ENDED | ||
31 March | 31 March | |
2024 | 2023 | |
Employee compensation | 6.3 | 6.3 |
Professional services | 1.8 | 4.3 |
Other corporate expenses | 2.4 | 2.9 |
Total corporate costs | 10.5 | 13.5 |
9
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Endeavour Mining plc published this content on 02 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 May 2024 06:36:08 UTC.
