PERRIERI OFFICE SUITES, C2-302, Level 3, Office Block C, La Croisette, Grand Baie 30517, Mauritius ALPHAMIN ANNOUNCES Q1 2022 EBITDA OF US$98m/ TIN SOLD UP 9% TO 3,336 TONNES FOR THE QUARTER
NEWS RELEASE
C/o ADANSONIA MANAGEMENT SERVICES LIMITED, Suite 1,
PERRIERI OFFICE SUITES, C2-302, Level 3, Office Block C,
La Croisette, Grand Baie 30517, Mauritius
ALPHAMIN ANNOUNCES Q1 2022 EBITDA OF US$98m/ TIN SOLD UP 9% TO 3,336
TONNES FOR THE QUARTER
MAURITIUS – May 13, 2022 – Alphamin Resources Corp. (AFM:TSXV, APH:JSE
AltX)( “Alphamin” or the “Company”), a producer of 4% of the world’s mined tin1 from its high
grade operation in the Democratic Republic of Congo, is pleased to provide the following
operational update for the quarter ended March 2022:
Q1 EBITDA2 of US$98.1m, up 32% from prior quarter
Contained tin sold up 9% from the prior quarter to 3,336 tonnes
Record plant recovery of 78% achieved (previous quarter: 75%)
Net cash2 position increased 90% to US$129.8m, after a US$30m dividend payment
Maiden mineral resource declared and subsequently updated at Mpama South
Decision to commence construction of the Mpama South mine following positive PEA
results
Continued high grade assay results from ongoing drilling campaigns at Mpama North
and Mpama South
Operational and Financial Summary for the Quarter ended March 20223
Description Units Actual
Quarter
ended
March 2022
Quarter ended
December
2021
Change
Ore Processed Tonnes 105,565 107,981 -2%
Tin Grade Processed % Sn 3.7 3.9 -4%
Overall Plant Recovery % 78 75 4%
Contained Tin Produced Tonnes 3,061 3,114 -2%
Contained Tin Sold Tonnes 3,336 3,056 9%
EBITDA2 US$'000 98 104 74,347 32%
Net Cash2 (Cash less debt) US$'000 129,775 68,233 90%
Tin Price Achieved US$/t 43,834 38,432 14%
AISC2 $/ton sold 15,782 15,117 4%
__________________________________________________________________________________________
1Data obtained from International Tin Association Tin Industry Review Update 2021. 2This is not a standardized financial measure
and may not be comparable to similar financial measures of other issuers.See “Use of Non-IFRS Financial Measures” below for
the composition and calculation of this financial measure. 3Production and financial information is disclosed on a 100% basis.
Alphamin indirectly owns 84.14% of its operating subsidiary to which the information relates. Totals may not add due to rounding
effects.
Operational and Financial Performance – Q1 2022
Contained tin production of 3,061 tonnes is in line with the previous quarter and FY2022
guidance. Underground mining continued to deliver steady results and processing plant
recoveries increased to 78% from 75% the previous quarter. Contained tin sales increased by
9% to 3,336 tonnes at an average tin price of US$43,834/t. The AISC2 per tonne of contained
tin sold during Q1 2022 increased by 4% to US$15,782 from US$15,117 due to the impact of
a higher tin price on off-mine costs (as some of these costs are variable and increase with
increases in the tin price) and taking delivery of a large amount of replacement mining
equipment. As a result of steady production, good cost control and higher revenue, EBITDA
for Q1 2022 amounted to US$98.1m, up 32% from US$74.3m the previous quarter.
Alphamin’s unaudited consolidated financial statements and accompanying Management’s
Discussion and Analysis for the quarter ended 31 March 2022 have been filed and are
available for viewing and download under the Company’s profile at www.sedar.com.
Capital Allocation
Alphamin’s vision is to become one of the world’s largest sustainable tin producers. From a
capital allocation perspective, the Board considers the combination of investment in growth,
significant exploration, and a high dividend yield a robust value proposition. Dividend
distributions will be considered semi-annually based on excess free cash after taking account
of the capital funding requirements for the new Mpama South expansion project recently
announced.
Exploration activity continues to be a focus area with expansionary and infill drilling expenditure
of ~US$20million planned for FY2022. To date, approximately 85% of drill holes completed
intercepted visual tin mineralisation. A number of market announcements were released
regarding high-grade assay results from drilling activities together with a maiden and updated
mineral resource statement for Mpama South.
The Alphamin consolidated Net Cash position increased by US$61.5 million during Q1 2022
to US$129.8 million. This increase is after a US$30 million cash dividend paid to shareholders
on 11 February 2022. The FY2021 DRC government tax liability of US$43 million was paid in
April 2022 subsequent to end of the quarter.
Mpama South updated resource and decision to commence with development
On 29 March 2022, the Company announced an updated mineral resource for Mpama South
and the decision to commence with development. Mpama South’s development is expected to
increase annual contained tin production from the current 12,000tpa to ~20,000tpa,
approximating 6.6% of the world’s mined tin1. First tin production from Mpama South is
targeted for December 2023.
The PEA study for Mpama South is conceptual in nature and PEA’s generally are most
commonly applied to projects at an early stage of exploration to conceptualise potential
viability. A PEA is not a pre-feasibility or feasibility study and the Company does not purport
the Mpama South PEA results to be equivalent to a pre-feasibility or a feasibility study.
Notwithstanding the very preliminary and conceptual nature of the PEA for Mpama South,
based on the Company’s experience at Mpama North and knowledge base, including
regarding underground conditions, the mining method and processing route, and the proximity
and very similar characteristics of the deposits, the Company believes that Mpama South
represents an immediately accessible adjacent mineral resource to the current producing
Mpama North mine and accordingly a decision to commence with development has been
taken.
Covid-19 Pandemic and Impact on Operations
The health of our employees is of paramount importance and in this regard the Company has
a range of Covid-19 awareness, prevention and other risk mitigation controls in place.
To date, the Company has been able to continue with normal production and concentrate sales
activities.
General economic conditions
Global commodity prices have declined significantly during the month of May 2022 - the tin
price is currently trading at ~US$34,000/t (Q1 2022: US$43,834/t). The Company is a low-cost
producer of tin with significant operating margins at current prices and has a strong balance
sheet with large cash reserves for allocation towards its growth prospects, particularly the
development of the Mpama South project.
Qualified Person
Mr. Clive Brown, Pr. Eng., B.Sc. Engineering (Mining), is a qualified person (QP) as defined in
National Instrument 43-101 and has reviewed and approved the scientific and technical
information contained in this news release. He is a Principal Consultant and Director of Bara
Consulting Pty Limited, an independent technical consultant to the Company.
_________________________________________________________________________________________
FOR MORE INFORMATION, PLEASE CONTACT:
Maritz Smith
CEO
Alphamin Resources Corp.
Tel: +230 269 4166
E-mail: [email protected]
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Information in this news release that is not a statement of historical fact constitutes forward-
looking information. Forward-looking statements contained herein include, without limitation,
estimated impact of Mpama South on future tin production and the timing thereof; expected
additions to the mineral resource base from further exploration; development of the Mpama
South project and the timing thereof; the timing and estimated cost of future exploration
programmes; possible future dividend payments; the Company’s liquidity outlook; ; and the
sufficiency of current working capital. Such statements reflect the current views of the
Company with respect to future events and are subject to certain risks, uncertainties and
assumptions. Many factors could cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or achievements
that may be expressed or implied by such forward-looking statements. Such factors include,
without limitation: price volatility in the spot and forward markets for tin and other commodities;
the economic and other effects of the COVD-19 pandemic; significant capital requirements
and the availability and management of capital resources; additional funding requirements;
fluctuations in the international currency markets and in the rates of exchange of the currencies
of the Democratic Republic of Congo (DRC) and the United States of America (US);
discrepancies between actual and estimated production and the costs thereof; between actual
and estimated reserves and resources and between actual and estimated metallurgical
recoveries; changes in national and local government legislation in the DRC or any other
country in which Alphamin currently or may in the future conduct business; taxation; controls,
regulations and political or economic developments in the countries in which Alphamin does
or may conduct business; the speculative nature of mineral exploration and development,
including the risks of obtaining and maintaining the validity and enforceability of the necessary
licenses and permits and complying with the permitting requirements of each jurisdiction in
which Alphamin operates, including, but not limited to: obtaining the necessary permits for the
Bisie Project; the lack of certainty with respect to foreign legal systems, which may not be
immune from the influence of political pressure, corruption or other factors that are inconsistent
with the rule of law; the uncertainties inherent to current and future legal challenges Alphamin
is or may become a party to; diminishing quantities or grades of reserves and resources;
competition; loss of key employees; inclement weather conditions; availability of power, water,
transportation routes and other required infrastructure for the Bisie tin project; general
economic conditions and inflation and rising costs of labour, supplies, fuel and equipment;
actual results of current exploration or reclamation activities; uncertainties inherent to mining
economic studies; discrepancies between actual and estimated capital costs for the
development of Mpama South; changes in project parameters as plans continue to be refined;
accidents; labour disputes; defective title to mineral claims or property or contests over claims
to mineral properties; risks, uncertainties and unanticipated delays associated with obtaining
and maintaining necessary licenses, permits and authorisations and complying with permitting
requirements, including those associated with the environment. In addition, there are risks and
hazards associated with the business of mineral exploration, development and mining,
including environmental events and hazards, industrial accidents, unusual or unexpected
formations, pressures, cave-ins, flooding and losses of processed tin (and the risk of
inadequate insurance or inability to obtain insurance to cover these risks), as well as “Risk
Factors” included elsewhere in this MD&A and Alphamin’s public disclosure documents filed
on and available at www.sedar.com. Forward-looking statements contained herein are made
as of the date of this news release and Alphamin disclaims any obligation to update any
forward-looking statements, whether as a result of new information, future events or results or
otherwise, except as required by applicable securities laws.
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 news release.
USE OF NON-IFRS FINANCIAL PERFORMANCE MEASURES
This announcement refers to the following non-IFRS financial performance measures:
EBITDA
EBITDA is profit before net finance expense, income taxes and depreciation, depletion, and
amortization. EBITDA provides insight into our overall business performance (a combination
of cost management and growth) and is the corresponding flow driver towards the objective of
achieving industry-leading returns. This measure assists readers in understanding the ongoing
cash generating potential of the business including liquidity to fund working capital, servicing
debt, and funding capital expenditures and investment opportunities.
This measure is not recognized under IFRS as it does not have any standardized meaning
prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented
by other issuers. EBITDA data is intended to provide additional information and should not be
considered in isolation or as a substitute for measures of performance prepared in accordance
with IFRS.
NET CASH
Net cash is defined as cash and cash equivalents less total current and non-current portions
of interest-bearing debt and lease liabilities.
AISC
This measures the costs to produce and sell a tonne of contained tin plus the capital sustaining
costs to maintain the mine, processing plant and infrastructure. AISC includes mine operating
production expenses such as mining, processing, administration, indirect charges (including
surface maintenance and camp and tailings dam construction costs), smelting costs and
deductions, refining and freight, distribution, royalties and product marketing fees. AISC does
not include depreciation, depletion, and amortization, reclamation expenses, borrowing costs
and exploration expenses.
Sustaining capital expenditures are defined as those expenditures which do not increase
contained tin production at a mine site and excludes all expenditures at the Company’s projects
and certain expenditures at the Company’s operating sites which are deemed expansionary in
nature.