AFRITIN, the UK-listed tin development firm, said it was “set fair” for the remainder of its financial year after the ramp up of its pilot plant at Uis mine was interrupted amid Covid-19 lockdowns in Namibia, where the operation is located.
Anthony Viljoen, CEO of Afritin, said in comments to the firm’s interim results – in which the company posted a 15 pence per share loss (2019: -10p/share) – that the plant at Uis produced 37.5 tons of tin concentrate in August.
The goal, however, is 60 tons/month of material which, if proven in the pilot plant, will pave the way for the roll out of a larger phase two project that also includes production of by-product minerals such as tantalum.
Historically, the Uis mine (previously operated by South African steel producer, Iscor) produced about 1,500 tons of tin concentrate annually.
Whilst production this year ended-August generated just over £1m in revenue, the company is also hoping there are no further interruptions to production, nor a deterioration in the price of tin, assumed for the pilot plant to be $18,000/t.
That’s because Afritin – as typical for a junior or development mining company – is managing balance sheet pressure that would grow in the event of interruptions, potentially arising from additional Covid-19 cases nationally.
Afritin raised in £3.8m convertible loan notes, issued in November last year, which are to be settled in shares, and a further £2.05m in loan notes issued in May, both of which mature next year. For the £2.05m loan note, however, there is no agreement to settle in shares.
“In the event of further disruption to the production ramp up or operational cash flow as a result of Covid-19 or other related operational issues, the group may require additional funding,” Afritin said in notes to its interim results.
The company ended the year with £2.58m in cash and equivalents which includes a working capital facility provided by Nedbank in Namibian dollars the equivalent of which is £1.9m. Viljoen said the facility from Nedbank was a significant vote of confidence in the firm’s development plans.
In August 2020, AfriTin raised additional equity through a placing and subscription of £3.05m shares at a price of 2.1p/share through existing shareholders and “… prominent new institutional investors”, the firm said.
“Their participation demonstrates on-going confidence in our team’s ability to deliver our stated strategy and growth plans,” said Viljoen. Shares in the company are trading at 2.24p/share in London valuing the company at £18.3m.
