quarterly activities report september 2019 september quarter … · 2020-04-06 · asx / media...

ASX / MEDIA ANNOUNCEMENT ASX: NCZ

Quarterly Activities Report September 2019

Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 1 / 15

Capital Structure

Ordinary Shares

637,277,523

Unlisted Options

117,390,000 (range $0.25 - $1.99/sh,

average price $0.45/sh)

Board

Rob McDonald Indept. Chairman

Patrick Walta Managing Director

Bryn Hardcastle Non Exec. Director

Nick Cernotta Indept. Non Exec. Director

Peter Watson Indept. Non Exec. Director

Evan Cranston Non Exec. Director

Oonagh Malone Company Secretary

Media Enquiries

Shane Goodwin

Head of Corporate Affairs

[email protected]

+61 434 039 106

September Quarter Executive Summary

Record Performance Highlighted by Strong Exit Rate

New Century continues to execute its ramp up to 12Mtpa

capacity over FY20. Zinc production continues to rise, up a

further 28% in the September quarter to 26,171t zinc metal.

The record production performance is also highlighted by a

strong exit rate to the quarter, with the month of September

delivering 10,013t of zinc metal, establishing Century in the top

15 zinc producing mines in the world.

C1 cash costs for the quarter were finalised at US$0.99/lb

payable zinc metal (19% improvement quarter-on-quarter), with

the month of September dropping a further 10% to US$0.90/lb.

The Company also became operationally cashflow positive in

the month of September, with total operational costs of the

business at US$1.02/lb payable metal (including C1 costs plus

all corporate, interest & royalty costs), against a 3 year low zinc

price of US$1.05/lb & including 10 year high TCs of ~US$280/t.

New Century expects further improvements to metal production

and cost reduction during the December quarter via the ramp

up in mining rate and continued recovery optimisation within

the recently upgraded scavenger and cleaner circuits.

New Century maintains its December 2019 quarter guidance of

27,000t to 33,000t zinc metal and C1 cash costs of US$0.87/lb

to US$0.98/lb payable zinc metal.

Strong Increase in Recovery Rate

Implementation and commissioning activities of the full cleaner

circuit (online mid-August 2019) resulted in a significant

improvement in recoveries throughout the quarter. The month

of September achieved an average zinc recovery of 52%.

The stability of operations has also significantly improved, with

the operations achieving consistent average weekly zinc

recoveries of over 50% since the new cleaners have come online.

Further improvements to recoveries are anticipated over the

December quarter through the continued optimisation of the

cleaner circuit and commissioning of the recently announced

scavenger circuit upgrade.

2 / 15

Progressive Increase in Mining Rate & Feed Stability

Improvements to recoveries were also accompanied by an increase in the overall mining rate from

operations throughout the quarter, with the month of September producing an average of 8Mtpa,

and further increases continuing into the December quarter (now approaching 9Mtpa).

The stability of mining operations has also significantly improved, with consistent steady state

operations above 8Mtpa now being achieved.

Cashflow Management

Despite record zinc production, the 15% quarterly decline in the zinc price (average $1.05/lb

September quarter vs $1.25/lb for the June quarter) impacted short term cashflows from Century

operations. September quarter receipts from customers (i.e net revenue after all payability,

treatment charges and impurity penalties) totalled A$45M (down 10% from A$50M in the June

quarter), not including A$8.1M in outstanding concentrate invoices. This was against direct

production costs of A$48M (see Table 1 for a breakdown of the full quarterly financials).

The zinc price decline also impacted the value of final invoices for shipments from the June quarter

(again reducing quarterly cashflow), where the negative adjustment of the zinc price from

provisional invoices (made as the ship leaves Karumba load port) to settlement invoices (made after

the ship arrives at its discharge port) resulted in negligible revenue being received from the final

~10% of value within contracts closed out during the September quarter.

As a result, the quarter showed negative cash flow, albeit with expansion and sustaining capital

and one-off interest payments representing 66% of the $30M cash outflow and the Company also

having A$8.1M in outstanding concentrate shipment invoices at quarter end.

New Century closed the quarter with A$53M in cash and receivables. Expansion and sustaining

capital requirements remaining for FY20 are on budget at A$27M, which once complete, will finalise

tailings expansion capital expenditure.

From a debt perspective, the A$60M Varde facility remains in place and fully drawn, with the parties

in active discussion around the expansion of this secured facility under more favourable terms than

the previous higher cost A$40M unsecured facility.

Finally, despite the low zinc price and record high treatment changes, Century operations achieved

their first positive operational cashflow month in September 2019. Given that ramp up expansion

capital requirements are nearing finalisation, and the fact that ~70% of Century’s total operating

costs are fixed, there is a clear pathway to a significant increase in cash generation over FY20 and

beyond.

The Company also notes the recent rebound in zinc prices (up 16% from a low of US$1.00/lb in

September to US$1.16/lb currently) provides the opportunity for a positive reverse effect on final

invoicing of recent shipments which have provisional invoices at substantially lower prices.

Treatment charges are also expected to fall in the medium term, with a recent clear increase in

Chinese smelter production rates (up 6% quarter-on-quarter).

3 / 15

September 2019 Quarter Highlights

Overall Performance Guidance

• Achieved September 2019 quarterly production and cost guidance: 26,171t of zinc metal at C1 cash costs of US$0.99/lb

• December 2019 quarter guidance maintained at 27,000t – 33,000t zinc metal & C1 Costs of US$0.87/lb – US$0.98/lb (payable metal inc. treatment charges)

• Century ramp up remains on track to double plant capacity over FY20 through refurbishment of the second train of flotation cells

• Plant capacity expansion to assist driving down C1 Costs to a LOM average target of US$0.56/lb (tailings only operations)

• New Century is on track to become a top 10 zinc producer over the next 12 months through completion of plant refurbishment process

Figure 1: Century’s quarterly metal production performance and annualised mining rate

4 / 15

Figure 2: Century’s average daily metal production ramp up & average monthly zinc recovery trend

[^October 2019 estimated to the end of month based on performance to date]

Figure 3: Century’s quarterly C1 cost trend (including TCs) against zinc price

[Q2 FY20 forecast based on scheduled operational ramp up process. Consensus Economics data used for zinc price projection,

which utilises the average of 28 investment bank projections]

5 / 15

Quarterly Cashflow Performance

• A$45.3M in receipts from customers during the September quarter (vs A$50.0M June quarter), below expectation due to a 15% decrease in zinc price over the period

• Quarterly direct production expenditure of A$48.6M, in line with expectations

• Quarterly expenditure of one-off expansion & sustaining capital totalling A$16.9M

Processing Plant Performance

• Record quarterly zinc metal production, with September 2019 quarter totalling 26,171t (vs 20,450t in June 2019 quarter – 28% increase quarter-on-quarter)

• Implementation of full cleaning circuit (cleaner 2B-4B online August 2019) has allowed a step change in recovery performance, with the month of September averaging 52%

• Recovery performance into the December quarter to date has been maintained while bringing on additional throughput, ramping up from 8Mpta to 9Mtpa

• October 2019 operations on track for a new record daily production rate

Quarterly Hydraulic Mining Performance

• Third mining cannon online with current capacity to deliver a mining rate of 9Mtpa+

• Continued strong reconciliation of mining grade to the ore reserve model, with the ore grade mined during the September 2019 quarter averaging 2.96% Zn

• New Century is targeting ramp up to a 12Mtpa mining rate in FY20 in line with additional plant capacity and a 4th mining cannon

Quarterly Shipping & Sales Performance

• Continued loadout and delivery of concentrate shipments throughout the quarter

• Average impurity penalties and treatment charges continue to be maintained in line with standard market pricing and remain competitive with other miners

• Treatment charges expected to fall in the medium term, with a recent clear increase in Chinese smelter production rates (up 6% quarter-on-quarter), further improving profitability from concentrate production

Corporate Activities

• Completion of a fully underwritten capital raising and SPP, raising A$43.3M

• Secured a landmark royalty deferral agreement with the Queensland government

6 / 15

Operational Developments

Quarterly Cashflow Performance

Table 1 provides an extract from the Company’s Appendix 5B (Quarterly Financial Report) reported

in conjunction with this Quarterly Activities Report. Further commentary on individual items within

Table 1 is provided below.

Table 1: Extract of the Quarterly Financial Report including applicable details of each expenditure

Consolidated statement of cash flows Jun Q

$A’000 Details

1. Cash flows from op. activities

1.1 Receipts from customers

(revenue net of treatment charges, zinc

payability factor and impurity penalties) 45,357

Below expectations primarily due to quarterly zinc price

decline (15%) and 10-year high concentrate treatment

charges - See Figure 4

Excludes quarter end debtors for shipped concentrate

and finished stocks of concentrate awaiting contracted

shipment, totalling $8.1 million.

1.2 Payments for

(a) exploration & evaluation (888) In line with expectations

(b) development

(65,440)

Quarterly Costs:

(48,580) Production costs (in line with expectations)

Annual Costs:

(2,020) Sustaining capex – dredging part payment

One Off Costs:

(11,430) Expansionary capex

(3,410) Sust. Capex inc Wunma 5-yr survey costs

(c) production - -

(d) staff costs (3,904) In line with expectations

(e) administration and corporate costs (1,827) In line with expectations

1.3 Dividends received - -

1.4 Interest received 114 In line with expectations

1.5 Interest and other costs of finance paid (3,322)

Two quarters in Varde interest payments following

completion of the interest accrual period

1.6 Income taxes paid - -

1.7 Research and development refunds - -

1.8 Other (MMG support fees) (717) In line with expectations

1.9 Net cash from / (used in) op. activities

(30,627)

Excludes quarter end debtors for shipped concentrate

and finished stocks of concentrate awaiting contracted

shipment, totalling $8.1 million.

7 / 15

Receipts from Customers & Treatment Charges

As detailed in Table 1, during the June quarter the operations generated total receipts from

customers of A$45.3M. Despite increasing metal production, receipts from customers were 10%

lower than the June quarter due to an 15% fall in the zinc price.

Not included in receipts from customers for the September quarter are debtors for shipped

concentrate and finished stocks of concentrate awaiting contracted shipments, totalling A$8.1M.

Receipts from customers were also adversely affected by the current 10-year high concentrate

treatment charges in the zinc market. As shown in Figure 4, treatment charges have increased

~500% since the start of Century operations in September 2018.

Figure 4: Spot concentrate treatment changes over the last 10 years

(source: Wood Mackenzie and internal company data October 2019)

While treatment charges remain stubbornly high at present, they are anticipated to track

downwards in the medium term, through increased Chinese smelter production that has previously

been unavailable due to environmental restrictions (now lifted).

Figure 5: Chinese zinc smelter output (source: Wood Mackenzie October 2019)

$0

$50

$100

$150

$200

$250

$300

TC p

er t

on

ne

of

con

c. (

US$

)

Spot TC Av. Spot TC

Av. 10 yr spot TC US$130/t

5.20

5.40

5.60

5.80

6.00

6.20

6.40

6.60

2015 2016 2017 2018 2019 2020

Sme

lte

r O

utp

ut

(Mtp

a)

Spot TCs remain at 10 year highs,

expected to trend down with increasing

Chinese smelter production

Improving Chinese smelter

production set to reduce global

concentrate stocks (TC reduction)

8 / 15

Figure 5 shows the annual movement in Chinese zinc smelter production. The significant decline in

2018 production was as a direct result of new domestic environmental regulations. These

regulations forced the suspension or shutdown of many smelters in China until refurbishment or

rebuilding activities were complete. With these smelters now completing this process and coming

back online, Chinese smelter production has increased significantly over 2019. As a result,

treatment charges are anticipated to retreat from their 10-year highs in the medium term, noting

there are still substantial stockpiles of concentrate globally to be drawn down first.

A reduction of treatment charges going forward improves economic returns for Century operations

via increased receipts from customers and reduced C1 costs (outside of progressive increase in

quarterly metal production). By way of example, treatment charges reverting back to a 10 year

average (~US$130/t) reduces the C1 costs of Century operations by approximately US$0.15/lb.

Receipts from customers were also affected by the zinc price decline impacting the value of final

invoices for shipments from the June quarter, where the negative adjustment of the zinc price

from provisional invoices (made as the ship leaves Karumba load port) to settlement invoices (made

after the ship arrives at its discharge port) resulted in negligible revenue being received from the

final ~10% of value within contracts closed out during the September quarter.

The Company notes the recent rebound in zinc prices (up 16% from US$1.00/lb in September to

US$1.16/lb currently) provides the opportunity for a positive reverse effect on final invoicing of

recent shipments which have provisional invoices currently at substantially lower prices.

Expansion & Sustaining Capital Expenditure

The Company continues to invest in the plant refurbishment and ramp up process, with one-off

capital items totalling A$14.8M during the September quarter. This included expansion capital

items predominately associated with upgrading works to the cleaner and scavenger circuits as part

of the ramp up to 12Mtpa. Also included were one-off sustaining capital items associated with part

payment of the costs of the 5-yearly refurbishment (survey) of the Wunma.

One-off expansion capital items are expected to be completed over the course of FY20 in line with

the completion of the 12Mtpa ramp up process. This will enable the growing EBITDA profile of the

operations to flow through to free cash flow generation.

Over the quarter the Company also incurred annual sustaining capital items totalling A$2.0M,

primarily associated with part payment of dredging costs.

The Company is well progressed on its capital expenditure program for the planned the expansion

to 12Mtpa (budget $40M), which is now approximately 55% complete. $18M in further expenditure

is expected to be incurred throughout FY20. Importantly, expansion capital allocation remains on

budget and schedule.

New Century also expects to incur a further ~$9M in sustaining capital expenditure in FY20,

predominately associated with the 5 yearly survey of the Wunma and the annual dredging of the

Norman River. Sustaining capital allocation remains on budget and schedule.

9 / 15

Quarterly Processing Plant Performance

• Production of 26,171t zinc-in-concentrate in the September Q (28% increase on June Q)

• Achievement of 52% recoveries for the month of September following cleaner circuit upgrade

• Continued plant refurbishment activities scheduled to double plant capacity through FY20

• October operations on track to be a record average daily metal production rate

Overall zinc metal output increased by 28% during the September quarter, with 26,171t of zinc

metal produced in 53,500t of concentrate grading 49.0% zinc (compared to 20,450t zinc metal in

42,500t of concentrate at 48.1% zinc during the June quarter). Silver content of 150g/t in

concentrate remained in line with previous quarter.

Focus for the quarter was on delivery of the upgraded cleaner circuit within the processing plant,

removing bottlenecks for continued recovery improvement and increasing metal production. The

upgrade was delivered on schedule and budget in mid-August, providing a step-change

improvement in operational performance for the second half of the September quarter.

The improvements due to this upgrade are particularly evident in the performance during the

month of September, which delivered 10,013t of zinc metal at an average recovery of 52% zinc

(against an overall quarterly average recovery of 48% zinc). The improved recovery performance

has been maintained into October, with recovery averaging 51% for the month to date while

focusing on ramping up toward a 9Mtpa mining rate.

Figure 6: Century’s operational ramp up of recovery and plant throughput

As shown in Figure 6, the consistency of operations has also significantly improved since the

implementation of the cleaner circuit upgrade. Operations have achieved a reduction in variability

since early September, with weekly average recoveries >50% zinc since completion of the cleaner

10 / 15

circuit upgrade. Stability is expected to continue as the ramp up progresses, allowing for the

continued optimisation of all production parameters.

Concentrate quality also continues to improve, with zinc grade increasing to a quarterly average

of 49.0% (vs June 2019 quarter average 48.1%), again largely due to the cleaner circuit upgrade.

As per previous quarters, Century concentrate continues to receive relatively minor impurity

penalties and treatment charges that are in-line with current market rates.

New Century anticipates further improvements to metallurgical recoveries and metal production

rates during FY20, through the expansion to 12Mtpa plant capacity. Improvements during the

December 2019 quarter are set to be achieved from the continued optimisation of the upgraded

cleaner circuit and the commissioning of the recently announced scavenger circuit upgrade. See

Figure 7 for further details.

Table 2: Quarterly processing plant performance at Century

Processing Performance

Concentrate Grade Zinc Metal

Dec 18 Q 25,500t 47.0% Zn 12,080t

Mar 19 Q 37,500t 48.3% Zn 18,170t

Jun 19 Q 42,500t 48.1% Zn 20,450t

Sep 19 Q 53,500t 49.0% Zn 26,171t

Q-on-Q Difference +26% - +28%

Figure 7: Simplified plant plan view and scheduled refurbishment process for expansion to 12Mtpa

Zn Roughers Zn Scavengers

Zn Scavengers Bal

l Mill

03

Bal

l Mill

02

SAG

Mill

Zn Cleaner 1A

Zn Cleaner 1B

Zn Cleaner 2A Zn Cleaner 3A Zn Clnr

4A

Zn Cleaner 2B Zn Cleaner

3B

Zn Clnr

4B

UFM

s

Operational

To be Recommissioned

Legend:

Not under refurbishment

Stage 1 ONLINE (August 2019): Bringing cleaner 2B online removes bottleneck for efficient 8-9Mtpa operations, 3B and 4B for future 12Mtpa expansion

Stage 2 ONLINE (October 2019): Additional scavenger flotation capacity online for further increased recoveries and throughput

Zn Roughers

Stage 3 March 2020: Commissioning 2nd

rougher train allows expansion to 12Mtpa in conjunction with fourth mining cannon

11 / 15

Quarterly Hydraulic Mining Performance

• Hydraulic mining expansion to three cannon operations, now achieving >8Mtpa mining rate

• Mining grades reconciling strongly with ore reserve model, averaging 2.96% Zn

• Mining of 1.87Mt in the September 2019 quarter (vs 1.60Mt in the June 2019 quarter)

During the quarter the Company focused on operational stability with three hydraulic mining

cannons. The overall average mining rate increased 17% quarter-on-quarter (1.87Mt September Q

vs 1.60Mt June Q). As shown in Figure 6, stable operation has been achieved in hydraulic mining,

at a rate above 8Mpta during the month of September.

This stability has continued into October and the mining rate is now being progressively increased

to 9Mtpa over the course of the December quarter.

The average mined grade during the quarter was 2.96% Zn, which continues to reconcile strongly

with the Ore Reserve model and mine plan.

Approximately 8% of the overall tailings Ore Reserve has been mined to date.

Table 3: Quarterly mining performance at Century

Mining Performance

Mining Rate Mined Grade Cannons in Use

Dec 18 Q 1.50Mt 2.95% Zn 2

Mar 19 Q 1.39Mt 2.92% Zn 2

Jun 19 Q 1.60Mt 2.92% Zn 2 (3rd online May)

Sep 19 Q 1.87Mt 2.96% Zn 3

Q-on-Q Difference +17% - -

Figure 8: Hydraulic mining operations to date at the Century Zinc Mine

12 / 15

Quarterly Shipping & Sales Performance

During the quarter the Company continued to maintain shipping rates in line with monthly

production.

All production has been sold to date, with New Century having completed 17 shipments to 7

different smelters across China, Europe and Australia.

As with previous quarters, New Century’s concentrate impurity penalty rate and treatment charges

remain in line with standard market pricing and are also competitive with other global zinc miners.

Corporate Developments

Completion of Capital Raising & Share Purchase Plan

During the quarter the Company successfully completed a fully underwritten institutional

placement and share purchase plan, raising A$43.3M before costs. The raising was completed by

way of issuance of 131.5 million shares and an issue price of A$0.33/share.

Debt Facility Developments

During the quarter the Company maintained the A$60M Varde senior secured facility in place and

fully drawn. The previous A$40M unsecured facility (undrawn) has expired, with the parties in active

discussion around the expansion of the secured facility under more favourable terms than the

previous higher cost A$40M unsecured facility.

Royalty Deferrals

During the quarter the Company announced it has secured the first ever royalty deferral agreement

with the Queensland Government under the Government’s Resources Regional Development

Framework (RRDF).

The RRDF, announced by the Queensland Government in May 2017, was established with a view to

unlocking development in the North West Minerals Province (in addition to the Galilee and Surat

Basins), creating new jobs and new business opportunities to benefit the State.

New Century Resources has been engaging with the Queensland Government since inception of the

program, with a view to securing an agreement under the Framework. Following an intensive period

of due diligence and Government engagement, the Company is pleased to have secured the first

and only royalty deferral agreement under the RRDF to date.

Under the Agreement, the Company can elect to defer royalties for a period of three years and

repay those royalties over the following three-year period. The Agreement is subject to full

documentation and execution of terms, which is expected to be completed over the coming months.

The securing of the landmark agreement with the Queensland Government in part recognises New

Century’s commitment to its innovative value proposition, which seeks to deliver tangible economic

13 / 15

mine rehabilitation benefits while also ensuring local stakeholders are partners in the process

through employment, ongoing dividends and community support.

The Agreement also provides an incentivisation pathway for continued exploration and future

development of the already identified in-situ resources at the Century Mine.

The Company also notes that during the quarter no royalty was paid as part of the existing private

vendor royalty, which has been agreed to be deferred until further notice.

Other Projects: Kodiak Coal Project (NCZ 70%)

The Kodiak Coal Project is currently on care and maintenance.

The Company continues to consider options with regard to the future of the Kodiak Coking Coal

Project in Alabama, USA, including disposal of the asset.

Lawn Hill & Riversleigh Pastoral Holding Company (NCZ 49%)

The Lawn Hill & Riversleigh Pastoral Holding Company is an active cattle operations located

adjacent to the Company’s mining leases.

The Company continues to assess operations in the relation to disposal of this asset.

To learn more, please visit: www.newcenturyresources.com

For further information, please contact:

New Century Resources Media enquiries

Patrick Walta Shane Goodwin

Managing Director Head of Corporate Affairs

P: +61 3 9070 3300 P: +61 434 039 106

E: [email protected] E: [email protected]

14 / 15

Statement of JORC 2012 Compliant Resources & Reserves

Mineral Resources Tonnes

(Mt) Zn (%) Pb (%)

Ag (g/t)

Zn (t) Pb (t) Ag (Oz)

South Block (Indicated)

6.1 5.3 1.5 43 322,000 90,000 8,550,000

East Fault Block (Indicated)

0.6 9.8 1.1 42 63,000 7,300 872,000

Silver King (Inferred)

2.7 6.9 12.5 120 186,000 337,500 10,500,000

TOTAL 9.4 6.1 4.6 65 571,000 434,800 19,922,000

Ore Reserves Tonnes

(Mt) ZnEq (%)

Zn (%) Ag

(g/t) Zn (t) Pb (t) Ag (Oz)

Century Tails (Proved)

71.6 3.1 3.0 12 2,132,000 - 28,340,000

Zinc Equivalent Calculation

ZnEq was calculated for each block of the Century Tailings Deposit from the estimated block grades.

The ZnEq calculation takes into account, recoveries, payability (including transport and refining

charges) and metal prices in generating a zinc equivalent value for each block grade for Ag and Zn.

ZnEq = Zn%+ + Ag troy oz/t*0.002573. Metal prices used in the calculation are: Zn US$3,000/t, and

Ag US$17.50/troy oz.

Competent Persons Statement

Mineral Resources

The information in this announcement that relates to Inferred Mineral Resources on the Silver King

Deposit was first reported by the Company in its prospectus released to ASX on 20 June 2017. The

South Block Deposit was first reported by the Company to the ASX on 15 January 2018 and the East

Fault Block Deposit was first reported by the Company to the ASX on 25 June 2019. The Company

confirms that it is not aware of any new information or data that materially affects the information

included in the original market announcements, and in the case of estimates of Mineral Resources,

that all material assumptions and technical parameters underpinning the estimates in the relevant

market announcement continue to apply and have not materially changed. The Company confirms

that the form and context in which the Competent Person's findings are presented have not been

materially modified from the original market announcement.

Ore Reserves

The information in this announcement that relates to the Ore Reserve at the Century Tailings

Deposit was first reported by the Company in its ASX announcement titled "New Century Reports

15 / 15

Outstanding Feasibility Results that Confirm a Highly Profitable, Large Scale Production and Low

Cost Operation for the Century Mine Restart" dated 28 November 2017. The Company confirms that

it is not aware of any new information or data that materially affects the information included in

the original market announcement, and in the case of estimates of Ore Reserves, that all material

assumptions and technical parameters underpinning the estimates in the relevant market

announcement continue to apply and have not materially changed. The Company confirms that the

form and context in which the Competent Person's findings are presented have not been materially

modified from the original market announcement.

Appendix 1:

The following information is provided pursuant to Listing Rule 5.3.3 for the quarter ended 30

September 2019:

Project Location Status Interest

Century Zinc Mine Queensland, Australia

ML 90058 Mt Isa Granted 100%

ML 90045 Mt Isa Granted 100%

EPM 10544 Mt Isa Granted 100%






Kodiak Coking Coal Project Alabama, USA

Coke Seam, Gurnee Property Shelby & Bibb Counties Lease 70%

Atkins Seam, Gurnee Property Shelby & Bibb Counties Lease 70%

Gholson Seam, Gurnee Property Shelby & Bibb Counties Lease 70%

Clark Seam, Gurnee Property Shelby & Bibb Counties Lease 70%

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

+ See chapter 19 for defined terms 1 September 2016 Page 1

+Rule 5.5

Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16

Name of entity

NEW CENTURY RESOURCES LIMITED

ABN Quarter ended (“current quarter”)

53 142 165 080 30 SEPTEMBER 2019

Consolidated statement of cash flows Current quarter $A’000

Year to date (3 months) $A’000

1. Cash flows from operating activities

45,357* 45,357 1.1 Receipts from customers

1.2 Payments for

(888) (888) (a) exploration & evaluation

(b) development (65,440) (65,440)

(c) production - -

(d) staff costs (3,904) (3,904)

(e) administration and corporate costs (1,827) (1,827)

1.3 Dividends received (see note 3) - -

1.4 Interest received 114 114

1.5 Interest and other costs of finance paid (3,322) (3,322)

1.6 Income taxes paid - -

1.7 Research and development refunds - -

1.8 Other (MMG support fees) (717) (717)

1.9 Net cash from / (used in) operating activities

(30,627) (30,627)

* Receipts from customers exclude quarter end debtors for shipped concentrate and finished stocks of concentrate awaiting contracted shipment, totalling $8.1 million





2. Cash flows from investing activities

- -

2.1 Payments to acquire:

(a) property, plant and equipment

(b) tenements (see item 10) - -

(c) investments - -

(d) other non-current assets - -

2.2 Proceeds from the disposal of:

80 80 (a) property, plant and equipment

(b) tenements (see item 10) - -

(c) investments - -

(d) other non-current assets - -

2.3 Cash flows from loans to other entities - -

2.4 Dividends received (see note 3) - -

2.5 Other - -

2.6 Net cash from / (used in) investing activities

80 80

3. Cash flows from financing activities

43,317 43,317 3.1 Proceeds from issues of shares

3.2 Proceeds from issue of convertible notes - -

3.3 Proceeds from exercise of share options - -

3.4 Transaction costs related to issues of shares, convertible notes or options

(2,175) (2,175)

3.5 Proceeds from borrowings - -

3.6 Repayment of borrowings - -

3.7 Transaction costs related to loans and borrowings

- -

3.8 Dividends paid - -

3.9 Other - -

3.10 Net cash from / (used in) financing activities

41,142 41,142

4. Net increase / (decrease) in cash and cash equivalents for the period

34,397 34,397 4.1 Cash and cash equivalents at beginning of

period

4.2 Net cash from / (used in) operating activities (item 1.9 above)

(30,627)

(30,627)





4.3 Net cash from / (used in) investing activities (item 2.6 above)

80

80

4.4 Net cash from / (used in) financing activities (item 3.10 above)

41,142

41,142

4.5 Effect of movement in exchange rates on cash held

274

274

4.6 Cash and cash equivalents at end of period

45,266

45,266

5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts

Current quarter $A’000

Previous quarter $A’000

5.1 Bank balances 45,152 34,283

5.2 Call deposits 114 114

5.3 Bank overdrafts - -

5.4 Other (provide details) - -

5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)

45,266^ 34,397

^ Cash and Cash equivalents excludes the debtor and the held stocks of concentrate $8.1 million

6. Payments to directors of the entity and their associates Current quarter $A'000

6.1 Aggregate amount of payments to these parties included in item 1.2 1,248

6.2 Aggregate amount of cash flow from loans to these parties included in item 2.3

-

6.3 Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2

Payments to directors/director associates for director fees, salary, accounting and other fees, including legal fees.

7. Payments to related entities of the entity and their associates

Current quarter $A'000

7.1 Aggregate amount of payments to these parties included in item 1.2 197

7.2 Aggregate amount of cash flow from loans to these parties included in item 2.3

-

7.3 Include below any explanation necessary to understand the transactions included in items 7.1 and 7.2

Payments to key management personnel



8. Financing facilities available Add notes as necessary for an understanding of the position

Total facility amount at quarter end

$A’000

Amount drawn at quarter end

$A’000

8.1 Loan facilities - -

8.2 Credit standby arrangements - -

8.3 Other (please specify) AUD$60,000 AUD$60,000

8.4 Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well.

9. Estimated cash outflows for next quarter $A’000

9.1 Exploration and evaluation 283

9.2 Development 16,706

9.3 Production 50,620

9.4 Staff costs 4,224

9.5 Administration and corporate costs 2,455

9.6 Other (provide details if material) *

9.7 Total estimated cash outflows 74,287

Excludes receipts from customers associated with zinc production. Refer to forward quarter production guidance released in October 2019 Quarterly Activities Report (27,000kt to 33,000kt zinc metal)

Quarterly development capital outflows are associated with ~A$10M in expansion capex (including the full scavenger circuit commissioning). And ~A$7M sustaining capex including continued dredging and one off Wunma refurbishment) see the October 2019 quarterly Activities Report for further details.

10. Changes in tenements (items 2.1(b) and 2.2(b) above)

Tenement reference and location

Nature of interest Interest at beginning of quarter

Interest at end of quarter

10.1 Interests in mining tenements and petroleum tenements lapsed, relinquished or reduced

NA

-

-

-

10.2 Interests in mining tenements and petroleum tenements acquired or increased

NA

-

-

-



Compliance statement

1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

2 This statement gives a true and fair view of the matters disclosed.

Sign here: Date: 29 October 2019 (Managing Director)

Print name: Patrick Walta

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

quarterly activities report september 2019 september quarter … · 2020-04-06 · asx / media...

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