Consolidated financial statements
For the fiscal year 2019
Press Release - November 2, 2020
Auplata Mining Group - AMG (Euronext Growth - FR0013410370 - ALAMG) - Financial Communication
PROGRESS STATUS
The parent company and consolidated financial statements have been finalized and are currently being reviewed and validated by the Group's Statutory Auditors so that the Annual Report can be published. In the meantime, a condensed summary of the consolidated financial statements is presented below1.
The consolidated financial statements at December 31, 2019 comprise the scope of consolidation which includes the AMG entities (exAuplata) and its subsidiaries: SMYD, Verdal Reforestage, Armina Ressources Minières, TNRF Holding, Brexia International Ltd, GPMI, AMG Peru (ex-BGPP) and OSEAD Mining Côte d'Ivoire (50% owned).
This condensed summary considers the very specific accounting treatment of the contribution transaction, which has been analyzed, in accordance with IFRS 3 "Business Combinations", as a reverse acquisition carried out in stages. The treatment of this transaction, which is rare and technically complex, required the support and intervention of specialists in consolidation and authoritative IFRS standards.
In order to ensure that shareholders and the market have the best possible information and understanding of the accounting transactions carried out, following the application of IFRS 3 "Business Combinations", the Group's decision was to take the necessary time to provide a drafting as precise as possible.
Board of Statutory Auditors (Deloitte & RSM)
"The audit of both the parent company and consolidated financial statements is in progress, and the Statutory Auditors are finalizing the verification of the notes and appendices to the parent company and consolidated financial statements.
CONSOLIDATED INCOME STATEMENT - CONDENSED INFORMATION
In accordance with IFRS 3 in the context of a reverse acquisition, the comparative consolidated financial statements at December 31, 2018 are those of AMG Peru, which is considered the acquirer for accounting purposes.
The consolidated financial statements as of December 31, 2019 include 12 months of activity of AMG Peru and 10 months of activity of AMG and its subsidiaries, considered as acquired for accounting purposes in accordance with IFRS 3.
AMG and its subsidiaries were consolidated on the basis of the book value of assets and liabilities as reported in the AMG Group's consolidated financial statements at February 28, 2019.
1. This is only a summary at this stage, all the information and explanations will be mentioned in the Annual Report.
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In '000€. | Notes | 31-12-19 | 31-12-18 | |
Revenue | 18.832 | 19.542 | ||
Purchasing and services | (15.364) | (11.511) | ||
Personnel expenses | (8.168) | (3.696) | ||
Taxes and duties | (306) | (523) | ||
Depreciation, amortization and provisions | (5.281) | (1.744) | ||
Other operating income and expenses | 6.449 | (641) | ||
Profit from recurring operations | ||||
(3.838) | 1.427 | |||
Non-recurring income and expenses | (2.489) | 0 | ||
Operating income | (6.327) | 1.427 | ||
Financial result | (4.750) | (6.081) | ||
Current income (loss) | (11.078) | (4.655) | ||
Income tax expense | 1.006 | 960 | ||
Share in the results of companies accounted for by the equity method | 21 | (341) | ||
Profit after tax from continuing operations | (10.051) | (4.035) | ||
Net income from discontinued operations | 0 | |||
Net income (loss) | (10.051) | (4.035) | ||
(10.048) | (4.035) | |||
Company Shares | ||||
Parties with non-controlling interests | ||||
(3) | 0 | |||
Income statement 2018
Fiscal year 2018 is characterized by a fall in non-ferrous metal prices from the second semester of the year, which led to a decrease in AMG Peru's sales and consequently in its net income. Despite this fall in prices, operating profit amounted to €1.4 million.
The net result amounts to -4.0 M€. The latter includes a non-recurring financial charge of - €5.8 million, corresponding to the fair value adjustment, in accordance with IFRS 9, of the debt contracted by AMG Peru with SAIL to finance the first capital increase of €5 million of AMG in July 2018. This operation subscribed by AMG Peru was a prerequisite and indispensable condition for the realization of the contribution in kind finalized on February 20, 2019. The restated net result of this operation amounts to €1.8 million.
Income statement 2019
Fiscal 2019 is characterized by the takeover of AMG by the shareholders of AMG Peru. This "Business Combination" transaction (application of IFRS 3) in stages was legally finalized on February 20, 2019.
The consolidated income statement shows a decrease in sales of -0.7 million euros, exclusively from AMG Peru's business; this is mainly due to the fall in metal prices during 2019.
Following the obtaining of the Complementary Prefectorial Order dated November 21, 2019, the "hot commissioning" operations (tests with pulp) of the "Dieu Merci" plant were able to start, but there was no production for fiscal year 2019.
Operating expenses include those of both AMG Peru and AMG. Fiscal year 2019 is strongly impacted by unusual transactions that have accounting consequences of the "Business Combination". As such, taking into account the applicable accounting standards, the Group's consolidated financial statements include :
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Badwill for €11.6 million, partially offset by the capital loss of €3.9 million recorded in the consolidated financial statements for the disposal of AMG shares at fair value;
Recognition of impairment losses in non-recurring income and expenses :
- 0.9 million on AMG Peru mining titles, mainly due to the decline in metal prices and the price outlook given by Worldbank,
- 2.7 M€ adjustment on the value of mining titles held by the subsidiary ARMINA ;
A non-recurring financial charge of - €0.8 million, corresponding to the fair value adjustment, in accordance with IFRS 9, of the debt contracted by AMG Peru with SAIL to finance AMG's second capital increase of €10.5 million in February 2019;
The reversal of provisions for social and commercial litigation of +1.8 M€.
CONSOLIDATED BALANCE SHEET - CONDENSED INFORMATION
Assets (in '000€) | Notes | 31-12-19 | 31-12-18 | ||
Non-current assets | 82.169 | 24.725 | |||
Goodwill | 0 | 0 | |||
Intangible fixed assets | 31.867 | 10.125 | |||
Property, plant and equipment | 28.316 | 7.219 | |||
Financial fixed assets | 21.799 | 278 | |||
Investments in associates | 0 | 5.479 | |||
Deferred tax | 189 | 1.624 | |||
Other non-current assets | 0 | 0 | |||
Current assets | 11.613 | 4.401 |
Inventories and work-in-progress Trade and other receivables Cash and other cash equivalents
1.543 | 840 | |
10.047 | 3.556 | |
22 | 5 | |
Assets held for sale | 0 | 0 | |
Total Assets | 93.783 | 29.126 | |
The change in balance sheet assets is mainly due to the inclusion of AMG in the scope of consolidation following the contribution transaction.
Non-current assets" increased by €57.5 million and are mainly composed of:
The production unit at the "Thank God" site of the AMG Peru plant, the balance sheet value of which takes into account the recording of the tax credit of €5.8 million recorded as a deduction from fixed assets.
Mining titles, the balance sheet value of which considers the recognition of impairment losses on the mining titles of AMG Peru and Armina (see consolidated income statement 2019).
The acquisition of a 39.85% interest as at December 31, 2019 in the OSEAD fund, which indirectly holds 37.04% in Compagnie Minière de Touissit. At December 31, 2019, the investment in the OSEAD fund amounted to €20.6m, taking into account a €3.4m write-down on OSEAD shares linked to the fall in the price of the underlying asset (Compagnie Minière de Touissit shares) at December 31, 2019.
Current assets" increased by €7.1m and are mainly composed of receivables, including €5.8m related to the tax credit file.
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Liabilities (in '000€) | Notes | 31-12-19 | 31/12/2018 | |||
Shareholders' equity (Group share) | 25.386 | 7.649 | ||||
Non-controlling interests | (127) | 0 | ||||
Non-current liabilities | 10.852 | 2.624 | ||||
Provisions | 6.561 | 2.312 | ||||
Loans due in over one year | 656 | 0 | ||||
Deferred taxes | 2.135 | 311 | ||||
Other non-current liabilities | 1.500 | 0 | ||||
Current liabilities | 57.672 | 18.854 | ||||
Provisions | 1.584 | 0 | ||||
Loans and financial debt due within one year | 36.540 | 12.478 | ||||
Trade and other payables | 19.548 | 6.376 | ||||
Liabilities related to assets held for sale | ||||||
0 | 0 | |||||
Total liabilities and shareholders' equity | 93.783 | 29.126 | ||||
The evolution of the liabilities on the balance sheet is notably distinguished by the capital increases that took place in 2019
(capital increase of €10.5 million and realization of the contribution in kind of AMG Peru (formerly BGPP) and by the capital reduction that cleared the losses for the fiscal year ending December 31, 2018 for an amount of €27.4 million, which resulted in AMG's share capital being equal to €191.9 million. The application of IFRS 3 "Business Combinations" resulted in the
release of the accounting reserves related to the contributed company from an accounting and non-legal standpoint, namely
AMG, resulting in Group shareholders' equity at December 31, 2019 of €25.4 million.
Non-current liabilities" mainly consist of provisions for site rehabilitation (€6.6 million).
Current liabilities" mainly comprise financial debts related to the financial support provided by AMG's reference shareholders. As a result of this support, the Group is not significantly indebted to financial institutions. Trade payables have changed significantly due to the supplies required to complete the construction of the "Dieu Merci" plant during the second half of 2019.
2020 OUTLOOK
AMG Guyana
Following the obtaining of the Complementary Prefectorial Order on November 21, 2019, the "commissioning" operations process has been finalized and a first production was carried out at the end of March 2020. Due to the pandemic, the "Dieu Merci" plant was closed from April to May 2020. The technical improvements that were planned during the first semester of 2020 were therefore realized during the second semester of 2020 despite the difficulties related to the pandemic, logistical difficulties, the availability of specialized consultants, and the increase of certain costs such as transport. These efforts have been rewarded, the Dieu Merci plant has resumed production since October 2020. This resumption of production is taking place gradually to take into account the technical improvements made on the site to reach a nominal production of 300 tons per day at the beginning of 2021.
AMG Peru
While many other Peruvian mining companies had to stop their operations due to the Covid-19 pandemic, AMG Peru never stopped production and was thus able to limit the decline in turnover despite the drop in raw material prices during this period. AMG Peru has maintained its cash balance while controlling its costs and guaranteeing its employees the best possible sanitary conditions.
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Auplata Mining Group SA published this content on 04 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 November 2020 22:45:09 UTC