GCAT Caracal Gold Plc

4 November 2024

Caracal Gold PLC

('Caracal' or the 'Company')

Interim results - 31 December 2023

Caracal Gold PLC ("the Company"), the East African gold producer with over 1.3 million oz of JORC-compliant gold resource, is pleased to announce its unaudited interim results for the six months ended 31 Dec 2023 ("the period"). These results can also be found on the Company's website.

Simon Grant-Rennick, Chairman, commented: "The completion of the interims indicates that the Company is one step nearer to being able to lift the Company's suspension and progress the prospectus in line with our announcement of 19 September. I would like to thank our shareholders for their continued patience."

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For further information visit www.caracalgold.com or contact the following:

Notes:

Caracal Gold plc is an expanding East African focused gold producer with a clear path to grow production and resources both organically and through strategic acquisitions. Its aim is to rapidly increase production to +50,000ozs p.a. and build a JORC compliant resource base of +3Moz. The Company is progressing a well-defined mine optimisation strategy at its 100% owned Kilimapesa Gold Mine in Kenya, where there is significant mid-term expansion potential and the ability to increase gold production to 24,000oz p.a. and the resource to +2Moz (current JORC compliant resources of approx. 706,000oz). Alongside this, Caracal owns 100% of Tyacks Gold Ltd which owns the Nyakafuru Project in Tanzania, which has an established high-grade shallow gold resource of 658,751oz at 2.08g/t contained within four deposits over 280 km2 and appears amenable to development as a large scale conventional open pit operation.

Caracal's experienced team has a proven track record in successfully developing and operating mining projects throughout Africa.

The Company is a responsible mining and exploration company and supports the positive social and economic change that it contributes to the communities in the regions that it operates. It is a proudly East African-focused company: it buys locally, employs locally, and protects the environment and its employees and their families' health, safety, and wellbeing.

On 26 October 2023, the Company announced the completion of phase 1 of the work program for the Mine Plan for the Kilimapesa expansion.  This was led by Minopex Advisory (Pty) Ltd, who were tasked with a review of the geological model, mineralization model and grade models; as well as producing the Whittle optimisations, pit designs and a project evaluation. 

This Phase 1 mining plan has 2,427,279t of ore mined over the 36-month period at an average grade of 1.06g/t. 529,756t at an average grade of 1.8g/t are processed through the Milling/CIL plant with 1,897,524t at an average grade of 0.86g/t processed by the Heap Leach plant. The plan assumes a 75% recovery by the Milling/CIL plant for 23,002oz recovered and a 50% recovery through the Heap Leach plant for a total of 26,153oz recovered. Combined Milling/CIL and Heap Leach production over the 36 months is 49,155oz.

The current capital cost to complete the Kilimapesa expansion project is approximately US $10.5m based on the results from the Phase 1 work. A reduction in the capital is expected and this plan will now be costed and an updated capital cost for the expansion project will be calculated and announced at a later date.

Board Appointments and Changes

On 19 July 2023, the Company announced the resignation of the Non-Executive Director, Rachel Johnston. There were no other Board changes during the period covered by these interim statements.

Outlook

The Company was pleased to announce two significant developments on the 28 October 2024. The receipt of the mining license for the Kanegele project in Tanzania and the finalization of payment terms with Tyacks Gold Limited's vendors.  This, alongside the announcement of 21 June 2024, which set out the details in the conditional funding secured from a strategic investor (the "Cynergy Transaction") and the Mine Plan mentioned above, highlight that the Company are making significant progress and expect to now have the essential funding for the Kilimapesa expansion.

Interim Financial Review for the Period 1 July 2023 to 31 December 2023

For the interim period from 1 July 2023 to 31 December 2023, the financial performance was marked by a reduction in revenue due to the temporary cessation of production and a smaller workforce. This in turn led to a decrease in administrative expenses from £1.9m to £1.2m.

Finance costs rose substantially from £0.3m to £0.9m due to increased interest expenses. The rise in these costs is largely driven by the addition of new financing facilities to support working capital and operational needs of the Group.

As of 31 December 2023, the balance sheet reflects an increased net liability position from £7.3m to £9.9m compared to the end of June 2023. This increase is primarily due to the new financing obtained within the period, contributing additional liabilities.

The cash outflow from operations remained comparable to the prior interim period, totalling approximately £1 million.

The proceeds from loan notes in this period amounted to £1.1m, a decrease from the £2m received in the prior interim period. Additionally, new equity from shareholders brought in £0.2 million.

In summary, the temporary cessation of production, the increased finance costs and additional financing have continued to place pressure on the Group's net liability position. However, management is focused on navigating these challenges with a continued emphasis on producing the required financial reports to lift its suspension, raise new finance and commence the Kilimapesa expansion mine plan as well as advancing the Kanegele project in Tanzania.

Principal Risks

The principal risks and uncertainties for the remaining six months of the financial year remain the same as those contained within the annual report and accounts as at 30 June 2023.

Despite the net liability position as of 31 December 2023, the directors are confident in the Group's ability to generate future income and its access to financing to do this. They also have reviewed the carrying value of the Group's assets and do not consider there to be any further impairment in their value since 30 June 2023.

Related- party transactions

On 13 July 2023, the Company announced that certain investors which took place in the subscription were introduced by Mr. Stefan Muller who is a Non-Executive Director of the Company. Mr. Muller's company Deutsche Gesellschaft für Wertpapieranalyse GmbH ("DGWA") was paid a commission of 5% of the gross proceeds of the amount introduced by DGWA (the "Commission"). DGWA has opted to take this commission in shares at the Subscription Price, totalling 3,350,000 ordinary shares (the "Commission Shares").

DGWA was also be paid a commission of 6% on the US $1m the Company received from Orca Capital GmbH via the issue or secured convertible loan notes announced on 16^th February 2023.

On 29 September 2023, the Company signed a short-term loan from the Director Robbie McCrae for £33,000 ($40,000) with an annual interest rate of 10%, repayable on 31 December 2025.

On 13 November 2023, the Company signed a short-term loan from the Director Robbie McCrae for $150,000 with an annual interest rate of 10% per annum above the Bank of England's Base Rate, repayable on 31 December 2025.

On 1 October 2024, the Company announced it had entered into a further Loan Agreement with Robbie McCrae, the CEO of Caracal. The principal amount of the loan is US$100,000. The final repayment date will be 31 December 2024, accruing interest at 10% per annum above the Bank of England's Bank Rate.

Statement of directors' responsibilities

The directors confirm that these condensed interim financial statements have been prepared in accordance with UK adopted International Accounting Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

·      an indication of important events that have occurred during the first six months and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the financial year; and

·      material related-party transactions in the first six months and any material changes in the related-party transactions described in the last annual report.

By order of the board

The interim report was approved by the Board of Directors and the above responsibility statement was signed on its behalf by:

Simon Grant-Rennick

Executive Chairman

4 November 2024

CARACAL GOLD PLC

INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME