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Cadence Minerals #KDNC – Letter of Intent to Acquire up to a 40% stake in the Pompeya and Sarzedas Tungsten, Antimony and Gold Exploration Tenements, Completion of £1 million Fundraise and Investment Updates

17th December 2024 / Leave a comment

Cadence Minerals (AIM: KDNC) is pleased to announce that it has entered into a letter of Intent with Hesperian Metal, S.L (“Hesperian”) to invest in and acquire up to 40% two prospective tungsten, antimony, and gold exploration packages in Spain and Portugal (“LOI”). The LOI will be funded via a fully over-subscribed placing with predominantly institutional investors for gross proceeds £1 million.

The two exploration tenement packages include the Pompeya Project in Spain, which covers a sizeable former mining province and is prospective for tungsten (“Pompeya”). The second tenement package is situated near Castelo Branco in eastern Portugal, which also contains several old mine workings and is prospective for antimony, tungsten, and gold (“Sarzeda”). Together, Pompeya and Sarzeda are referred to as the “Projects”.

Highlights

Cadence has conditionally agreed to an LOI to invest in and acquire up to 40% of several licenses which contain previously unidentified tungsten, antimony, and gold exploration targets.
The Pompeya project covers an area of approximately 470 square kilometres (km²) of mining and exploration licenses, featuring multiple mineralised skarns, and historic mine workings.
There has been limited exploration of tungsten in the area. However, recent investigations at Pompeya have identified tungsten ore (scheelite) in both the old mine workings and at the surface within skarn deposits.
Rock chip sampling returned tungsten oxide (“WO₃”) grades between 3.3% and 4.8%.
Other notable tungsten deposits in the Iberian Peninsula include the Los Santos Mine (currently on care-and-maintenance with the mill slated for restart in 2025) and the Panasqueira Mine (operating mine, almost continuously since 1896), both owned by Almonty Industries (TSE:AII). These operations have mineral resources (Measured and Indicated) of 3.7 Mt at 0.19% WO₃ and 10.0 Mt at 0.23% WO₃, respectively, according to the latest Almonty data.
Tungsten is recognised globally as a critical and strategic material due to its economic significance, supply risk, and limited substitution alternatives. Since 2020, the price of tungsten has risen from approximately US$200 per metric ton unit to around US$330 per metric ton unit.
The Sarzedaz project covers some 57km² and contains numerous old antimony and tungsten deposits, with associated tailings storage facilities.
Historic grab samples of the tailings storage facilities yielded a median grade of 9g/t of gold.
If Cadence proceeds with this investment, the capital raised will be used to advance the exploration of the Projects over the next six months to identify potential mineral resource targets.

Cadence CEO Kiran Morzaria commented: “As our flagship Amapá project continues to advance and de-risk, our Board are mindful of the changing macro landscape and our priority to ensure Cadence has maximum exposure to the critical minerals needed for energy and technology markets. As such, we are excited by the potential opportunity on offer with the Pompeya and Sarzeda projects, particularly given the increasing importance attached to tungsten as a strategic raw material. I look forward to reporting back on progress at the end of the exclusivity period with Hesperian Metals.”

“I am also pleased to confirm the Company has successfully raised £1 million before expenses to fund our investment into the Pompeya and Sarzeda projects and our continued investment into Amapá.”

Chairman Andrew Suckling added: “With Amapa progressing well and in particular it’s potential to feed high grade ore for “green iron”, I am pleased that our Board remains vigilant and open to new investment opportunities as the critical minerals landscape continues to shift. Once our due diligence process has completed, we fully expect the Pompeya and Sarzeda projects to complement our other investments into the critical minerals needed for energy and technology markets “

About the Projects

Pompeya

The Pompeya project is situated in the Extremadura region of southwest Spain. Hesperian Metals has executed an option and exploration agreement to purchase some 470 km² of mining and exploration tenements.

Regionally, Pompeya is within the Ossa—Morena Zone of the Iberian Massif and contains Lower Cambrian Carbonates, intruded by igneous rocks from the Hercynian Orogeny. The physical-chemical interaction between these intrusive bodies and carbonate host rocks rich in calcium and/or magnesium develops mineralised skarns, which include magnetite, tungsten, copper, and gold skarns. Skarn deposits are some of the largest sources of tungsten in the world, with some of the largest deposits located in China.

The Pompeya region contains multiple historic magnetite (iron ore) mines hosted in skarn deposits. However, the potential for Tungsten deposits was not recognised until recently. Early surface sampling was conducted after some mineralogical samples identified tungsten-bearing ore (scheelite) via UV field surveys. Scheelite, calcium tungstate (CaWO₄), is one of the most common tungsten sources, representing 65% of the world’s production, and is fluorescent under short-wave UV where it appears bright blue.

Figure 1 scheelite exposure under UV light at Pompeya project.

In addition to the UV field surveys, four rock samples were collected from skarn outcrops; these were sent to ALS Labs in Seville and returned between 3.3% and 4.8% Tungsten Oxide. These are significant assay results and justify further exploration.

Given the assay results, mineralised skarns, historic mine workings, and previously undiscovered Tungsten mineralisation, Pompeya has substantial mineral potential in the view of Cadence management. The next steps will be conducting detailed geological mapping alongside a comprehensive sampling programme and scout exploration drilling to identify potential mineral resource targets.

Figure 2 top skarn outcrop at old mines working, bottom sample from out crop under UV light.

Sarzeda

The Sarzeda project is in eastern Portugal, approximately 19km west of Castelo Branco and covers some 57km² The area contains several mineral deposits which were intermittently mined between 1916 and 1951. Hesperian has signed an option agreement to acquire these exploration concessions..

The area includes the old mines of Das Gatas (Mina do Vale da Carreira), Barroca da Santa, Pomar (Galdins), Casalinho, Monte da Goula, and Ficalho. The Das Gatas, Barroca da Santa, and Pomar mines were exploited from 1935 to 1951, mainly for antimony and tungsten.

The Das Gatas mine was exploited in the 1930s and 1940s. The workings extend from the surface to a vertical depth of 75 meters and 250 meters along the strike. The local plant produced an antimony concentrate with a high gold content; the precious metals were not recovered on-site.

Of particular interest are the old mine waste dumps, which were sampled and assayed in the 1980s and yielded significant gold results. Fifteen samples were taken, and the gold grades ranged between 0.4 g/t and 109.9 g/t, with a median grade of 30.9 g/t.

The Sarzeda project is within the Variscan Iberian Antimony Belt. The belt includes numerous old workings and mineralised deposits and can be followed for more than 400 kilometres W-E from central Portugal to southern Spain. Most known deposits are hosted in the Cambrian Schist-Graywacke Complex rocks and metasediments of Ordovician-Silurian age.

Tungsten

These Projects are expected to complement Cadence’s other investments in critical minerals needed for energy and technology markets.

Tungsten and its alloys stand out as some of the hardest metals, with tungsten boasting the highest melting point among all pure metals at 3,422°C. This unique combination of hardness and high-temperature resistance makes it a top choice for a wide range of commercial and industrial applications.

With its economic significance and limited substitution options, tungsten holds a strategic position in many global markets. The US, EU and UK all recognise its critical role, and have classified tungsten as a strategic raw material due to its economic importance, supply risks, and lack of viable substitutes. This underscores the gravity of tungsten’s role in the global economy and its irreplaceable value.

Tungsten carbide, with a hardness that rivals that of diamond, is a common choice for cutting tools and wear-resistant materials. Tungsten also finds applications in a diverse range of industries, including transportation (such as aircraft manufacturing and railways), mining, construction, defence, medical (for X-ray tubes and radiation shields), consumer electronics (like smartphones), and chemical products. Furthermore, tungsten and tin-based materials are currently under evaluation for potential use in lithium-ion batteries.

Details of the Letter of Intent with Hesperian

The LOI outlines the principal terms of the earn-in agreement to acquire up to 40% of Pompeya and Sarzeda. The decision to invest and investment stages are outlined below.

Hesperian and Cadence have agreed to an exclusivity period terminating in the Q1 of 2025. Cadence will complete its full due diligence during this period, and both parties will look to finalise a definitive investment agreement. Cadence will update the market as and when necessary.

Subject to a successful outcome to the due diligence and at Cadence’s option, Cadence will invest €430,000 over 6 months to fund early exploration costs, including surface mapping, initial scout drilling and sampling over Pompeya and reconnaissance exploration work at Sarzeda (“Phase 1 Exploration”). In addition, Cadence will issue Hesperian €175,000 of new ordinary shares in Cadence upon entering into a definitive investment agreement with Hesperian. These shares will be subject to a 12-month lock-in. In consideration of the Phase 1 Exploration investment and the issue of shares, Cadence will receive 15% interest in the Projects via such an interest in the relevant project licences.

After the completion of Phase 1 Exploration, and at its option, Cadence can invest a further €2,000,000 over 24 months to fund advanced exploration costs, including drilling priority targets and, if applicable, mineral resource development (“Phase 2 Exploration”). In addition, Cadence will issue Hesperian €600,000 of new ordinary shares in Cadence, which will be subject to a 12-month lock-in. In consideration of the Phase 2 Exploration Investment and the issue of shares, Cadence will receive a further 25% interest in the Projects at licence level.

If Phase 2 Exploration is successful, Cadence will have a first right of refusal to enter into a joint venture with Hesperian to explore and develop the Projects further.

Fundraise

Cadence intends to finance the potential investment into the Projects via an institutional placing and as has raised, subject to Admission, £1 million before expenses (the “Placing”) by way of a placing arranged by Fortified Securities of 66,666,667 new ordinary shares (the “New Ordinary Shares”) in the capital of the Company at a price of 1.5 pence per Ordinary Share (the “Issue Price”). In addition, Cadence has issued of the will issue 1,666,667 new ordinary shares to the introducers of the Projects for a consideration of £0.025 million, which will be subject to a 12-month lock in (“Introducer Shares”).

The Issue Price represents a discount of approximately 42% per cent to the closing bid price of 2.6 pence per ordinary share on 16 December 2024, the latest practicable business day before the publication of this Announcement.

Application will be made for the admission to trading on the AIM market (“AIM”) of London Stock Exchange plc (“LSE”) for the New Ordinary Shares and the Introducer Shares (“Admission”). Admission is expected to occur at 8.00 a.m. on or around 24 December 2024. The New Ordinary Shares and Introducer Shares will represent approximately 23 per cent of the Company’s issued share capital immediately following Admission.

Following Admission, the Company’s issued and fully paid share capital will consist of 295,971,037 Ordinary Shares, all carrying one voting right per share. The Company does not hold any Ordinary Shares in treasury. The figure of 295,971,037 Ordinary Shares may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority.

The New Ordinary Shares will be issued fully paid and will rank pari passu in all respects with the Company’s existing Ordinary Shares.

Use of Funds

The net proceeds of the fundraising will be used to fund Cadence’s investment in Hesperian Metals and, its continued investment in the Amapá Iron Ore Project in Brazil and associated working capital.

Update on the Amapá Project

Cadence and our joint venture partners continue to have productive conversations with potential partners and/or project equity financiers to complement the project debt financing as outlined in our announcement AIM 30 October 2023. Cadence management believes that developing the DR-grade flow sheet will further these discussions. Once a binding material contract is in place, Cadence will inform shareholders.

In April and September of this year, the Amapá Project submitted all the requested applications and environmental studies for Amapá’s mine, railway, and port. This application was in the form of the Environmental Control Plan, “PCA” (Plano de Controle Ambiental), and an Environmental Control Report, “RCA” (Relatório de Controle Ambiental). These applications and submissions are a pre-requisite for the Amapá State Environmental Agency (“SEMA”) to grant the Amapá Project its installation licenses, which are required to commence the rehabilitation and construction of the Amapá Project.

Our joint venture has continued to engage with SEMA and other relevant authorities. SEMA recently requested that the Amapá project obtain standard clearances from federal, state, and municipal authorities for the railway license. These have been submitted, and we are awaiting responses. We have requested an update regarding the timeline and will inform the market once SEMA has provided guidance.

Amendment to Loan Facility

The Company has agreed to an amendment to the loan facility, which was announced on AIM 26 May 2023. The amendment varies the repayment profile and maturity date. The amended loan facility has a principal repayment holiday until March 2025, with the remaining balance being paid in eight equal instalments ending in November 2025. The Loan Facility has an effective annual interest rate of 9.5%.

About Hesperian Metals, S.L

Hesperian Metals, S.L. is a privately owned company dedicated to the exploration and development of antimony and critical mineral projects across the historic Iberian Peninsula. Their mission is to address the modern-day supply shortfall of essential minerals through sustainable and innovative mining practices.

With a diverse and experienced team, Hesperian Metals leverages in-depth regional knowledge to unlock the rich endowment of historic mines in Iberia. They are committed to meeting the global demand for critical commodities, particularly antimony, which plays a vital role in various industries.

Their approach is rooted in sustainability and innovation, ensuring that our operations not only contribute to the global supply chain but also promote environmental stewardship and community engagement.

Further information on Hesperian can be found here.

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

Zeus (NOMAD & Broker)	+44 (0) 20 3829 5000
James Joyce
Darshan Patel

Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Cadence Minerals #KDNC – PFS Level Economic Study for the Amapa Iron Ore Project Increases Net Present Value to US$1.97 Billion

3rd December 2024 / Leave a comment

Cadence Minerals (AIM: KDNC), the AIM-quoted investment company, is pleased to announce an updated Pre-Feasibility Study (“PFS”) on the Amapá Iron Ore Project (“Amapá”, “Project” or “Amapá Project”), in northern Brazil. Cadence owns an equity stake of 34.6% in the Project. The updated PFS is based on the Direct Reduction grade (“DR-grade”) flow sheet announced on AIM: 26 November 2024.

Highlights:

73%[1] increase of post-tax Net Present Value (“NPV_10%“) to US$1.97 billion and 56% internal rate of return (“IRR”).
Average annual free cash flow from start-up to closure is estimated to be US$342 million.
The Project is estimated to generate a total of US$9 billion in gross revenues, US$4.9 billion in net operating profit and US$4.6 billion in free cash flow over its 15-year mine life.
Revised processing plant design to produce 5% Iron (“Fe”) DR-grade iron ore concentrate at an average[2] rate of 5.5 million metric tonnes per annum (“Mtpa”).
Free on Board (“FOB”) C1 Cash Costs US$33.7 per dry metric ton (“DMT”) at the port of Santana. Cost and Freight (“CFR”) C1 Cash Costs US$61.9/DMT in China.
Pre-production capital of US$377 million, and the payback period is reduced to 3 years due to higher free cash flows.

Cadence CEO Kiran Morzaria commented: “This significant update to the Amapá Prefeasibility Study, which includes the DR-grade concentrate flow sheet, reinforces our firm belief that the project can add substantial value to Cadence. The increased net present value of $1.97 billion and improved post-tax internal rate of return reflect significant advancements in the project’s robust economics.

The Amapá Project represents a well-developed and largely de-risked opportunity, featuring established mineral reserves, advanced environmental permitting, and complete control of integrated rail and port infrastructure. This ownership and control of the infrastructure contribute to the project’s low-cost base and will enable the pursuit of regional expansion opportunities, with substantial resources located within 30 kilometres of the existing rail line. In addition to the DR-grade flow sheet, the project will use 100% renewable energy sources. We anticipate this will help us achieve one of the lowest carbon footprints in the region while still delivering a robust and highly profitable project.

We are excited about the potential of the Amapá Iron Ore Project and look forward to providing further updates on our progress.”

Chairman Andrew Suckling added: “The Amapa Project is now emerging as a material “green iron” project, backed by product quality and highly competitive economic metrics. We are at this juncture due to the tireless efforts of the Board and Project team, and I’d like to put on record my thanks and gratitude to them and our shareholders and stakeholders. I look forward to Amapa playing its part in “green steel” production and the decarbonisation of the iron and steel industry.“

Table 1 Key Project Metrics (100% project basis)

Metric	Unit	Revised PFS July 2024	Updated DR Grade PFS Nov 2024
Total ore feed to the plant	Mt (dry)	176.93	176.93
Life of Mine	Years	15	15
Fe grade of ore feed to the plant	%	39.34	39.34
Recovery	%	76.27	75.27
62.0% iron ore concentrate production	Mtpa	0.95	–
65.4% iron ore concentrate production	Mtpa	4.51	–
67.5% iron ore concentrate production	Mtpa	–	5.52
C1 Cash Costs FOB *	US$/DMT	33.50	33.75
C1 Cash Costs CFR **	US$/DMT	62.19	61.93
Pre-Production capital investment***	US$M	343	377
Sustaining capital investment over life of mine****	US$M	245	220
AISC Cash Costs FOB*****	US$/DMT	45.22	47.38
Platts TSI IODEX 65% Fe CFR used	US$/DMT	118.75	120.00
Post-tax NPV_10%	US$M	1,145	1,977
Post-tax IRR	%	42	56
Project payback	Years	4	3
Total profit after tax (net operating profit)	US$B	3.14	4.96

*	Means operating cash costs, including mining, processing, geology, occupational health and safety environment, rail, port and site G&A, divided by the tonnes of iron ore concentrate produced. It excludes royalties and is quoted on a FOB basis (excluding shipping to the customer).
**	This means the same as C1 Cash Costs FOB; however, it includes shipping to the customer in China (CFR).
***	Includes direct tax credit rebate over 48 months
****	Includes both sustaining capital and deferred capital expenditure, specifically, improvements to the railway, the installation of a slurry pipeline and mine site to rail load out
*****	Includes all the C1 Cash Cost, plus royalties, pre-production capital investment and sustaining capital investment over the life of the mine and is quoted on a FOB basis

Introduction

The Project comprises an open-pit iron ore mine, a processing and beneficiation plant, a railway line, and an export port terminal. The Amapá Project is 100% owned by DEV Mineração S.A. (“DEV”) and its subsidiaries. DEV is owned by Pedra Branca Alliance Pte. Ltd. (“PBA”), a joint venture (“JV”) between Cadence and Indo Sino Trade Pte Ltd (“Indo Sino”).

The Project ceased operations in 2014 after the port facility suffered a geotechnical failure, which limited iron ore export. Before the cessation of operations, the Project generated an underlying profit of US$54 million in 2012 and US$120 million in 2011. Operations commenced in December 2007, and in 2008, the Project produced 712 thousand tonnes of iron ore concentrate. Production steadily increased, producing 4.8 Mt and 6.1 Mt of iron ore concentrate products in 2011 and 2012, respectively.

Cadence and Indo Sino, through their JV, acquired 100% of DEV’s shareholding in 2022 through the submission of a judicial restructuring plan approved by the unsecured creditors. As part of this plan, DEV sought to redevelop the Amapá Project. This strategy includes a plan to resume operations after plant revitalisation and modifications, aimed at improving product quality and increasing recovery, along with recovery of the port, railway, and support areas.

It should be noted that Indo Sino and Cadence have managed this PFS, and it represents an update to the PFS published on AIM: 3 January 2023 and the revised PFS published on AIM: 9 July 2024. In particular, this updated PFS has been prepared to reflect the 67.5% Fe concentrate flow sheet.

Location

The Project is in Amapá state. Amapá is Brazil’s second least populous state and the eighteenth largest by area. Most of the Amapá state territory is rainforested, while the remaining areas are covered with savannah and plains. The State capital and largest city is Macapá (pop. circa 500,000), with the municipality of Santana (pop. circa 120,000) located just 14km to the southwest.

The Amapá mine is some 125km northeast of the state capital, Macapá, and the port facility is located on the Amazon River in the municipality of Santana, close to Macapá, as shown in (Figure 1). The port site in Santana is located 170km from the mouth of the Amazon River. The nearest populace centre to the Amapá mine is Pedra Branca Do Amapari, some 11km west, with the larger town of Serra do Navio 18 km northwest.

Figure 1 Location of the Amapá Project

Amapá Project Components

The Amapá Project PFS encompasses four distinct but completely integrated operational components that formed part of the original PFS. The four areas are:

Amapá Mining Complex: An open-pit iron ore mine with various open pits, an iron ore concentration and beneficiation plant, associated waste rock dumps, and a tailings management facility.

Railway Line: Integrated 194 km railway line connecting Serra do Navio to the port terminal at Santana. The rail passes via Pedra Branca do Amapari (180 km from the port), located 13 km from the Amapá mine and the plant.

Export Port Terminal: An integrated industrial port site, privately owned and controlled by DEV, is located in Santana. The terminal had the capacity for loading the Supramax and Handymax vessels.

Transhipment Solution: A Capesize vessel is partially loaded at the berth in Santana port and topped off in the open ocean, 200 nautical miles from the berth.

Updated Pre-Feasibility Study

As announced on AIM: 26 November 2024, the Amapá Iron Ore Project completed its metallurgy test work and successfully produced a DR-grade iron ore concentrate. The updated PFS investigates all the design, engineering, and business parameters required to implement the DR-grade flow sheet at a rate of 5.5 Mtpa (dry basis)/6.03 Mtpa (wet basis). This comprises the mine schedule published in July 2024 and the processing plant and associated infrastructure required for DR-grade concentrate production.

Mining Schedule

The improved flow sheet’s annual feed rate (“ROM”) is 13.99 Mtpa (wet base). The mining schedule prepared for the revised PFS published earlier in the year was utilised for this purpose. The mine engineering and design work for this PFS, including equipment requirements and mining strategy, have been undertaken by Wardell Armstrong International. These works have been conducted at the PFS level and incorporate an Ore Reserve Estimate for open pit mining, which was prepared under the guidelines of the JORC Code (2012). The Ore Reserve for the Amapá Project is at 195.8 million tonnes, with an average grade of 39.34% Fe and a cut-off grade of 25% Fe.

A Life of Mine (“LOM”) production plan was scheduled using the Deswik.Blend® Scheduler Optimiser. The solids used in the mine schedule were based on the final pit design, with a Selective Mining Unit of 100m x 200m x 4m. The LOM schedule allows for 15 years of production with the current economic values and cut-off of 25% Fe.

The resultant LOM strip ratio is approximately 0.4:1 (tonnes waste: tonnes ore), and the average ore mine delivered to the plant is 13.99 Mtpa. A site plan of the pits and phases is outlined in (Figure 2).

Figure 2 Open Pit Design Phases

Processing Plant

Pei Si Engineering Incorporated conducted the test work and designed the flow sheet. The metallurgical test work established that the optimal flow sheet utilised a regrind, which feeds into a low-intensity magnetic separator. This process produces two streams: the first stream goes to a reverse flotation circuit, while the second stream is sent to a high-intensity magnetic separator, followed by a second reverse flotation circuit. As a result of the above, the following main changes were made to the original PFS flow sheet published in January 2023.

Removing the jigging circuit, with the iron being recovered via the grinding, magnetic, and flotation circuits. This improves the iron recovery rate.
Replacing hydrocyclone desliming with thickeners, improving classification efficiency and lowering power consumption.
The 67.5% flow sheet will remove the 62% product stream, eliminating the spiral circuit. This will shorten the process flow and reduce power consumption.
Adding a flow sheet to improve iron concentrates from 65.4% to 67.5% via regrinding the material from the magnetic separator, meaning finer particles can be further liberated, improving iron concentrate grade to 67.5%.
Replacement of all slurry, water, and reagent pumps involved in the beneficiation process.
Due to a single concentrate product, the conveyor transport is replaced by a slurry pipeline and filtrate water return pipeline, reducing operating and capital costs.
The particle size of the concentrate after the tower mills is too fine to be filtered by the existing vacuum disc filters. Therefore, horizontal press filters are required to ensure the moisture content of the filter cake is no greater than 8%.
A train loading system will be built in the train loading area.

An outline of the plant layout is shown in (Figure 3)

Figure 3 DR-Grade Plant Layout

Cost Estimates

To evaluate the project’s economics, an updated PFS financial model, which included the updated mining schedule, capital costs (“CAPEX”), operational costs (“OPEX”), and revised product price, was developed. All other aspects of the financial analysis remained the same as per the revised PFS published in July 2024.

The CAPEX estimate is based on the layout for all areas of the Project and is supported by mechanical equipment lists and engineering drawings. The costs for these items have been derived from informal vendor quotes for the equipment and materials or consultant engineering databases. Parts of the CAPEX estimate are after tax (with the duties and taxes deemed recoverable calculated separately), include contingency, and exclude escalation. The CAPEX estimate includes all the direct and indirect costs, local taxes and duties and appropriate contingencies for the facilities required to bring the Project into production, as defined by a PFS-level engineering study. As this is a PFS, the cost accuracy is estimated at ± 25% and has a base date of June 2022 and November 2024. Pre-production, deferred and sustaining summaries of the capital cost estimates are provided below. Pre-production CAPEX has increased due to the equipment required to achieve the DR-grade product. However, the variance in the total CAPEX has been reduced. This is a result of producing one product stream, which uses a slurry pipeline to transport the concentrate from the mine to the rail loadout station rather than a conveyor.

Table 2 Pre-Production Capital Cost Estimates

Description	Revised PFS July 2024 (US$M)	Updated DR GradePFS Nov 2024 (US$M)
Direct Capex Mining	2.8	2.8
Direct Capex Beneficiation Plant	104.4	133.7
Direct Capex Rail	28.5	28.5
Direct Capex Port	113.9	113.9
Sub-total Direct Capex	249.6	278.9
Sub-total Indirect Capex	55.7	56.4
Environment and Community Cost	7.1	6.8
Deduct Tax Credit	-14.6	-14.0
Contingency	44.7	49.2
Pre-Production Capex Costs	343.2	377.5

Table 3 Deferred, sustaining, and closure capital costs over LOM.

Description	Revised PFS July 2024 (US$M)	Updated DR Grade PFS Nov 2024 (US$M)
Railway (2^nd Phase)	20.0	20.0
Tailings Storage Facility	9.8	9.8
Pipeline Construction / Conveyor	60.5	33.6
Pipeline Construction – EIA/RIMA	0.4	0.3
Contingency	–	9.6
Stay in Business	90.7	84.4
Closure Costs	62.8	62.8
Total Deferred Capital Costs	244.5	220.5

OPEX for the Project has been prepared based on the Project physicals, detailed estimates of the consumption of key consumables based on those physicals, and the unit cost of consumables.

The periods considered are annual, and production follows the production plan produced by DEV, based on a yearly output of 5.5 Mtpa of DR-grade (dry basis) / 6.03 Mtpa (wet basis). OPEX comprises physicals, labour, reagents and operating consumables, freight and power costs, mobile equipment, utilities, maintenance and mining contract costs, external contractor costs, environmental, and miscellaneous/other General and Administrative (G&A) expenses. OPEX estimates were prepared or advised by independent consulting engineers. The estimate is supported by engineering, benchmarking, and pricing of key consumables and costs derived from past production figures and informal quotes from suppliers. The table below illustrates the operating costs developed by discipline during the PFS. The project FOB and CFR average cash cost per tonne of dry product over the LOM is summarised below. Overall cash costs have been reduced primarily due to the use of the slurry pipeline, which has reduced the plant costs. Mining costs have increased due to the lower recovery rate.

Table 4 FOB and CFR average cash cost per tonne of dry product over the LOM

Cash Cost Per Discipline	Revised PFS July 2024	Updated DR Grade PFS Nov 2024
	US$/DMT	US$/DMT
Mine	16.73	17.65
TSF	0.08	0.09
Beneficiation Plant, Pipeline, Transfer & Rail Loading	10.94	10.50
Rail Freight	2.43	2.26
Port	1.55	1.52
G & A	1.77	1.74
FOB Cash Costs	33.50	33.75
Marine Logistics	28.70	28.18
CFR Cash Costs	62.20	61.93

DR-Grade Pricing Mechanism

Steel contributes about 8% of global carbon emissions, potentially reaching 12% by 2035. The industry is shifting from traditional Blast Furnace and Basic Oxygen Furnace (“BF/BOF”) methods to Direct Reduced Iron and Electric Arc Furnace (“DRI/EAF”) processes to promote greener production. While BF/BOF emits around 2.2 tons of CO₂ per ton of steel, DRI/EAF can reduce this to 0.3-1 per ton with hydrogen. Wood Mackenzie projects EAF’s share will grow from 28% to 38% by 2033, supported by significant government funding to reduce emissions and increase DRI/EAF capacity.

Due to its strong slag rejection capabilities, the BF/BOF process efficiently processes a wide range of iron ore grades. In contrast, the EAF is sensitive to impurities, making low-grade iron ore with high impurity levels problematic for yield and increasing electricity consumption and slag production. Thus, the EAF requires iron ore with over 67% purity and gangue elements like SiO₂ and Al₂O₃ below 2.5%, as shown in (Figure 4).

Figure 4 Summary of Iron Ore Content and Gangue[3]

The drive to decarbonise industries and the rise in DRI and EAF steel production are increasing demand for DR-grade pellet feed, like that envisaged to be produced at Amapá. CRU, a globally recognised consulting firm, estimates that 2050 demand for DR-grade pellet feed is expected to reach 310 million tonnes. In Europe, regulatory pressures to cut emissions further drive demand. However, a significant supply shortfall of about 100 million tonnes is anticipated, necessitating new DR-Grade iron ore projects.

Iron ore is primarily traded on a CFR or FOB basis. CFR transactions transfer ownership upon unloading at the destination and include shipping costs. Due to the lack of transparent indices for products like Amapá’s, the industry recommends using a comparable index with adjustments. The Platts TSI IODEX 65% Fe CFR China is the closest benchmark for assessing Amapá’s DR-Grade product, with an additional premium for the DR-grade material.

The 65% Fe Index for the updated PFS was evaluated using various methods. Price forecasts available in the public domain from Wood Mackenzie (US$92.50/DMT), CRU (US$96.00/DMT), and Fastmarkets (US$120.00/DMT) were considered. Historically, the 3-year trailing price averages US$152.20/DMT, and the 5-year average is US$135.70/DMT¹. Based on these considerations, Amapá has used US$120.00/DMT, an increase of US$1/DMT compared to the Project’s previously published PFS.

It is generally agreed that DR-grade iron ores should command a premium over the 65% Fe Index. It is anticipated that the Amapá DR-Grade, given its beneficial properties, will qualify for this premium. One recognised industry assessment technique for product premiums involves utilising a Value in Use (“VIU”) methodology. This approach entails determining a premium or discount by considering Fe, SiO₂, and Al₂O₃ variations compared to the 65% Fe. Amapá has used the premium attributed to the Kamistiatusset Iron Ore Property (“Kami”) in Newfoundland as a guide to determine and assist the Value in Use (VIU) analysis. This analysis suggests a premium of about US$24.8/DMT, though this may not fully account for green premiums or carbon savings.

Table 5 Comparative product specification between Kami and Amapá iron ore projects.

Product	TFe%	SiO₂%	Al₂O₃%	P%	TiO₂%	CaO%	MgO%	US$ Premium / DMT
Amapá Concentrate	67.5	0.6	0.84	0.08	0.02	0.03	0.03	27.6
Kami Concentrate	67.6	2.1	0.25	0.02	0.03	0.3	0.35	24.8

Project Financial Analysis

A PFS financial model was developed to evaluate the project’s economics. Summary results from the financial model outputs, including financial analysis, are presented in tables within this section. The financial model considers 100% equity funding for the Project, although, in reality, the financing of the Project will be a mix of debt and equity. However, the existing obligations in terms of principal repayment and current interest liabilities payable have been included in the financial model.

The product change and increased premium associated with DR-grade iron ore concentrate are primary economic drivers to changes in the financial model compared to the revised PFS published in July 2024.

Table 6 Summary of key financial information for the Project.

Item Over Life of Mine	Unit	RevisedPFS July 2024	Updated DR GradePFS Nov 2024
Gross revenue	US$M	9,389	11,242
Freight (Maine Logistics)	US$M	(2,351)	(2,188)
Net Revenue	US$M	7,038	9,054
Operating costs	US$M	(2,744)	(2,621)
Royalties and taxes (excluding income tax)	US$M	(373)	(460)
EBITDA	US$M	3,922	5,973
EBIT	US$M	3,547	5,586
Net Taxes and Interest	US$M	(390)	(621)
Net Operating Profit	US$M	2,144	4,964
Initial, Sustaining capital costs & repayments	US$M	(645)	(656)
Free Cash Flow	US$M	2,672	4,696

Item	Unit	RevisedPFS June 2024	Updated DR Grade PFS Nov 2024
Life of mine	Years	15	15
Discount rate	%	10	10
NPV_10%	US$M	1,145	1,977
IRR	%	42	56
Project Payback	Years	4	3

Project Sensitivity Analysis

A sensitivity analysis was performed on key parameters within the financial model to assess the impact of changes on the project’s post-tax NPV (debt-free). To examine the sensitivity of the Project base case NPV, each cost factor’s economic and operational conditions were independently varied within a range of +/—25%, and discount rates were changed within the 8%-15% range.

Project sensitivity analysis demonstrates that the Amapá Project is most sensitive to a change in iron ore concentrate price, followed by logistics costs (marine shipment charges) and operating costs. It was least sensitive to deviation in CAPEX (Figure 5)

Figure 5 Project Sensitivity Analysis (NPV_10%)

Cadence Ownership

As of the end of November 2024, Cadence’s total investment in the Amapá Project is approximately US$14.3 million, and its equity stake in the project stands at 34.6%.

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

Zeus (NOMAD & Broker)	+44 (0) 20 3829 5000
James Joyce
Darshan Patel
Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Qualified Person

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

Cautionary and Forward-Looking Statements

Certain statements in this announcement are or may be considered forward-looking. Forward-looking statements are identiﬁed by their use of terms and phrases such as “believe”, “could”, “should”, “envisage”, “estimate”, “intend”, “may”, “plan”, “will”, or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the company’s future growth results of operations performance, future capital, and other expenditures (including the amount, nature, and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reﬂect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes actions by governmental authorities, the availability of capital markets reliance on crucial personnel uninsured and underinsured losses and other factors many of which are beyond the control of the company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The company cannot assure investors that results will be consistent with such forward-looking statements.

[1] Compared with revised PFS published on AIM: 9 July 2024

[2] Average after one year ramp up until year 14 of mine life

[3]. Champion Iron Limited Pre-feasibility Study for the Kamistiatusset (Kami) Iron Ore Property. [online] Available at: https://company-announcements.afr.com/asx/cia/1e8c4153-e249-11ee-b0cc-26a478d59520.pdf [Accessed 1 Dec. 2024]

Cadence Minerals #KDNC – Amapa Iron Ore Project Confirms Ability to Produce +67% Fe High Purity, Direct Reduction Iron Concentrates

26th November 2024 / Leave a comment

Cadence Minerals (AIM: KDNC) is pleased to announce the metallurgical test results confirming the ability to produce high-purity, Direct Reduction grade (“DR-grade”) iron concentrates at the Amapá Iron Ore Project (“Amapá” or the “Project”) in northern Brazil.

Highlights:

· DR grade concentrate produced at 67.5% Fe with total silica and alumina below 1.5%.

· The process flowsheet has been confirmed to have a PFS level of accuracy.

· DR concentrate was achieved with a finer grind, magnetic separation and reverse flotation, as outlined in the announcement on 17 September 2024.

· The forecast premium for DR-Grade concentrate is projected to rise to around US$20 for each 1% iron content above 65% Fe benchmark.

· A revised economic model based on the DR-Grade sheet is being prepared.

CEO, Kiran Morzaria, commented: “We are excited to announce a significant milestone in the development of the Amapá Project. We have successfully produced a DR-Grade grade concentrate of 67.5% iron, characterised by low silica and alumina levels. The production of DR-grade products at Amapá will substantially improve the project’s economics and allow us to further our discussion with potential collaborators and joint venture partners.”

“The demand for DR-grade products is essential for steel production methods that significantly lower carbon emissions. The demand for DR-grade feed is anticipated to increase by more than five-fold by 2050, reflecting the steel industry’s commitment to decarbonisation. Despite the current limited supply of these products, DR-grade offerings are already commanding substantial price premiums, highlighting their value in the market.”

Chairman, Andrew Suckling, added: “On behalf of myself and the Board, I’d like to record our thanks and gratitude to our shareholders and stakeholders for their patience as we complete each milestone on the road to recommissioning Amapa. Our ability to produce this DR-grade concentrate adds a new value dimension to our flagship project. It gives the Board huge confidence that Amapa can play a role in “green steel” production and the decarbonisation of the iron and steel industry.”

Metallurgical Test Work Programme

Cadence previously announced that Amapá had developed a process flow sheet for producing Direct Reduction (“DR grade”) concentrates with combined SiO₂ (“silica”) and Al₂O₃ (“alumina”) levels below the steel industry’s DR grade standard of 2.5%. The initial results from the test work program have validated the Project’s process flowsheet’s ability to produce DR-grade concentrates.

The test results produced a weighted average final product with a concentrate grade of 67.5% Fe and impurity levels of 0.6% SiO₂and 0.8% Al₂O₃. Furthermore, the iron concentrate grade is expected to be higher and exceed 68% Fe by appropriately adjusting the flotation reagent process parameters.

Pei Si Engineering Incorporated (“PSEI”) conducted the test work and designed the flow sheet. The primary section of the flow sheet, which aims to upgrade the 65% product to 67%, involves regrinding, magnetic separation, and flotation. The test work was carried out on a +65% iron ore concentrate produced from the Amapá Project.

The metallurgical test work established that the optimal flowsheet utilised a regrind, which feeds into a low-intensity magnetic separator (“LIMS”). This process produces two streams: the first stream goes to a reverse flotation circuit, while the second stream is sent to a high-intensity magnetic separator (“HIMS”), followed by a second reverse flotation circuit.

The results indicate that using a fine grinding process (with a fineness of -0.045mm at 79.5%)-LIMS-HIMS-flotation, two types of flotation iron concentrates were obtained: Concentrate I and Concentrate II. Concentrate I achieved a yield of 12.31%, a grade of 69.36% Fe, with SiO₂ and Al₂O₃ contents of 0.10% and 0.39%, respectively, and a total iron recovery rate of 12.89%. Concentrate II yielded 70.57%, with a grade of 67.15% Fe, SiO₂ content of 0.71%, Al₂O₃ content of 0.92%, and a total iron recovery rate of 71.55%. The iron concentrate grade is expected to exceed 68% with appropriate adjustments to the flotation reagent process parameters. The test results are presented in Table 1.

Table 1 Grinding-LIMS-HIMS-Flotation Test Results (%)

Product	Yield	Grade				Fe Recovery Rate
Product	Yield	Fe	SiO₂	Al₂O₃	P	Fe Recovery Rate
Flotation Con I	12.31	69.36	0.10	0.39	0.039	12.89
Flotation Con II	70.57	67.15	0.71	0.92	0.089	71.55
Flotation Middling	0.96	67.14	2.32	2.87	0.118	0.98
Flotation Tailings	6.25	65.92	3.29	3.13	0.22	6.22
HIMS Tailings	9.91	55.94	3.12	3.42	0.27	8.36
Feed	100.00	66.23	1.05	1.26	0.11	100.00

Product Analysis

The head assays of concentrate I, concentrate II, and the calculated product are shown in Table 2 below:

Table 2 The head assays of Concentrate I and Concentrate II (%)

Product	Fe	SiO₂	Al₂O₃	S	P	Cu	TiO₂	CaO	MgO
Concentrate I	69.36	0.10	0.39	0.0014	0.039	0.001	0.014	0.02	0.020
Concentrate II	67.15	0.71	0.92	0.0017	0.089	0.002	0.025	0.03	0.026
Product	67.48	0.62	0.84	0.0020	0.082	0.002	0.023	0.03	0.025

Upon microscopic examination of the sample, it was observed that the iron minerals were highly liberated, reaching over 90%, with occasional intergrowths of gangue minerals, such as quartz, alongside iron minerals like hematite. Fine grinding can further enhance liberation, which is beneficial for mineral processing to reduce the silica and alumina impurity content in the iron concentrate. It was also noted that phosphorus primarily adsorbs onto hematite, resulting in isomorphous substitutions. Given the iron content (above 67% Fe) and the low levels of silica and alumina impurities (totalling less than 2.5%), this product can be marketed as direct reduced (“DR”) grade iron ore concentrate[1].

“Dr Grade” Concentrate Market and Price

The DR-grade feed suitable for low-emission steelmaking represents 3% of global seaborne iron ore production. Its availability is crucial for transitioning to “green steel” and decarbonising the iron and steel industry. DR-grade concentrates are used as feedstock for new Direct Reduced Iron / Electric Arc Furnace (DRI-EAF) facilities, replacing older, coal-dependent Blast Furnace / Basic Oxygen Furnace (BF-BOF) operations.

High-grade Blast Furnace feed (over 66% iron) is increasingly sought during this transition, as it lowers carbon emissions when blended with lower-grade Direct Shipping Ores (under 62% iron). The metallurgical tests focus on producing DR-grade Concentrates. These concentrates typically contain over 67.5% iron and low levels of impurities like silica, alumina, phosphorus, and sulphur, with a total of below 3%.

The current premium for DR-grade iron ore is approximately US$5 for each 1% iron content above 65%[2]. In comparison, this premium is projected to rise to around US$20 for each 1% iron content above 65%[3]. This change would have a positive impact on the Project’s net present value (“NPV”) of US$1.14 billion. We anticipate an improvement in the NPV in our updated economic model.

Next Steps

Testing has been conducted at the pre-feasibility study (“PFS”) level. PSEI is currently reviewing the flow sheet outlined in Figure 1 below. The goal is to publish a revised economic analysis at the PFS level incorporating a product stream with an expected purity of 67.5% and an updated NPV.

Figure 1 Amapa Process Flowsheet

A diagram of a factory Description automatically generated

About the Amapá Project and Cadence Ownership

The Amapá Project is a brownfield integrated iron ore project in the Amapá State of Brazil. It has Mineral Resources of 276 million tonnes (“Mt”) at 38.33% Iron (“Fe”) and Ore Reserves of 196 Mt at 39.34%. The Project consists of the mine, processing plant, wholly owned port and a 194km railway, all operated by PBA.

As of 31 August 2024, Cadence’s total investment in the Amapá million was approximately US$14.2 million, and its equity stake in the project stands at 34.5%, an increase of approximately US$0.57 million since 30 June 2024

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

Zeus Capital Limited (NOMAD & Broker)	+44 (0) 20 3829 5000
James Joyce
Darshan Patel
Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Qualified Person

Cautionary and Forward-Looking Statements

Cadence Minerals #KDNC – Fundraise to raise £750,000 for further Amapa Project activities

12th July 2024 / Leave a comment

Cadence Minerals (AIM: KDNC) announces that it has successfully raised, subject to Admission, £625,000 before expenses (the “Placing”) by the way of a placing arranged by Fortified Securities of 25,000,000 new ordinary shares (the “New Ordinary Shares”) in the capital of the Company at a price of 2.5 pence per Ordinary Share (the “Issue Price”).

In addition to the above subscription, Andrew Suckling, Kiran Morzaria, and Donald Strang (together, the “Subscriber Directors”) have also agreed to subscribe for an aggregate of 5,000,000 New Ordinary Shares at the Issue Price, raising gross proceeds of £125,000 (“Subscription”).

The Issue Price represents a discount of approximately 18 per cent to the closing price of 3.05 pence per ordinary share on 11 July 2024, being the latest practicable business day prior to the publication of this Announcement.

Use of Funds

The net proceeds of the fundraise will be used to fund Cadence’s investment in the Amapá Iron Ore Project in Brazil (“Amapá”, “Project” or “Amapá Project”), specifically:

The continued testing of the 67% Fe “Green Iron” product flow sheet, to a PFS level or accuracy.
Prepare and publish a revised PFS economic model should the 67% flow sheet be successful that reflects the increase pricing anticipated from the product and any change in capital or operating expenditure in the revised flowsheet.
General working capital at the Amapá Project and ongoing funding for the licensing for the tailing storage facility.

Related Party Transactions

As the Directors of the Company, being the Subscribing Directors, are considered to be “related parties” as defined under the AIM Rules, their participation in the Subscription constitutes a related party transaction for the purposes of Rule 13 of the AIM Rules.

Director	Subscription Amount	No. of New Ordinary Shares subscribed for	Resulting shareholding in the Company	% shareholding in the Company’s issued share capital as enlarged by the Placing
Andrew Suckling (Non-Executive Chair)	£40,000	1,600,000	1,981,602	0.87%
Kiran Morzaria (Chief Executive Officer)	£45,000	1,800,000	3,373,240	1.48%
Donald Strang (Finance Director)	£40,000	1,600,000	2,557,545	1.12%
Adrian Fairbourn (Non-Executive Director)	Nil	Nil	731,005	0.32%
Total	£125,000	5,000,000	8,643,392	3.79%

Adrian Fairbourn, being a Director of the Company independent of the fundraise, having consulted with Cadence Mineral’s Nominated Adviser, WH Ireland Limited, consider the terms of the fundraise to be fair and reasonable insofar as the Company’s shareholders are concerned.

Application will be made for the admission to trading on the AIM market (“AIM”) of London Stock Exchange plc (“LSE”) for the New Ordinary Shares (“Admission”). Admission is expected to occur at 8.00 a.m. on or around 19 July 2024. The New Ordinary Shares will represent approximately 13.2 per cent. of the Company’s issued share capital immediately following Admission.

Following Admission, the Company’s issued and fully paid share capital will consist of 227,637,704 Ordinary Shares, all of which carry one voting right per share. The Company does not hold any Ordinary Shares in treasury. The figure of 227,637,704 Ordinary Shares may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority.

The New Ordinary Shares will be issued fully paid and will rank pari passu in all respects with the Company’s existing Ordinary Shares.

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

WH Ireland Limited (NOMAD & Broker)	+44 (0) 20 7220 1666
James Joyce
Darshan Patel Isaac Hooper

Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

In accordance with Article 19 of the UK Market Abuse Regulation, detailed information is set out below.

Details of the person discharging managerial responsibilities/person closely associated

Name:

Andrew Suckling

Reason for the notification

Position/Status:

Non-Executive Chair

Initial Notification/Amendment:

Initial Notification

Details of the issuer, emission allowance market participation, auction platform, auctioneer or auction monitor

Name:

Cadence Minerals plc

LEI:

213800TUZWG9C2GRNO58

Details of transaction(s); section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted.

Description of the financial instrument:

Identification code:

Ordinary shares of £0.01

ISIN: GB00BJP0B151

Nature of the transaction:

Purchase of Shares

Price(s) and volume(s):

Price(s)

Volume(s)

2.5p

1,600,000

Aggregated volume:

Price:

1,600,000

£40,000

Date of the Transaction:

11 July 2024

Place of the Transaction:

London Stock Exchange

Details of the person discharging managerial responsibilities/person closely associated

Name:

Kiran Morzaria

Reason for the notification

Position/Status:

Chief Executive Officer

Initial Notification/Amendment:

Initial Notification

Details of the issuer, emission allowance market participation, auction platform, auctioneer or auction monitor

Name:

Cadence Minerals plc

LEI:

213800TUZWG9C2GRNO58

Details of transaction(s); section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted.

Description of the financial instrument:

Identification code:

Ordinary shares of £0.01

ISIN: GB00BJP0B151

Nature of the transaction:

Purchase of Shares

Price(s) and volume(s):

Price(s)

Volume(s)

2.5p

1,800,000

Aggregated volume:

Price:

1,800,000

£45,000

Date of the Transaction:

11 July 2024

Place of the Transaction:

London Stock Exchange

Details of the person discharging managerial responsibilities/person closely associated

Name:

Donald Strang

Reason for the notification

Position/Status:

Finance Director

Initial Notification/Amendment:

Initial Notification

Details of the issuer, emission allowance market participation, auction platform, auctioneer or auction monitor

Name:

Cadence Minerals plc

LEI:

213800TUZWG9C2GRNO58

Details of transaction(s); section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted.

Description of the financial instrument:

Identification code:

Ordinary shares of £0.01

ISIN: GB00BJP0B151

Nature of the transaction:

Purchase of Shares

Price(s) and volume(s):

Price(s)

Volume(s)

2.5p

1,600,000

Aggregated volume:

Price:

1,600,000

£40,000

Date of the Transaction:

11 July 2024

Place of the Transaction:

London Stock Exchange

Cadence Minerals #KDNC – Annual Results for the year ended 31 December 2023

27th June 2024 / Leave a comment

Cadence Minerals (AIM/NEX: KDNC) is pleased to announce its final results for the year ending 31 December 2023. The full Annual Report and Audited Financial Statements will be available on the Company’s website at https://www.cadenceminerals.com/ and posted to shareholders by 30 June 2024.

CHAIRMAN’S STATEMENT

I am pleased to present the Company’s Annual Report and Audited Financial Statements for the year ended 31 December 2023.

On behalf of the Cadence Minerals board and management, I want to express my deep gratitude to all our consultants, advisors, service providers, and especially our shareholders. Your support throughout this challenging year has been invaluable to us.

Since our company’s inception, your board has strived to build a portfolio with enough balance and diversity to weather and thrive in challenging market conditions.

However, the year to December 2023 provided Cadence with a particularly unique set of challenges due to severe price movements in many of the underlying commodities we are focused on as a Company. More specifically, we have seen adverse price movements in lithium, rare earths, and iron ore beyond most analyst expectations and fundamental predictions.

Cadence has always taken a long-term view of prices, and our models always suggested such dramatic swings would reverse. However, this has not stopped severe and sudden pressure on our share price, coupled with an impact on our ability to raise capital in constrained markets. These factors have weighed heavily on our valuation as a Company during the period in question, and both the board and I are incredibly frustrated that the potential of our portfolio is in no way reflected in our share price performance.

Challenging conditions remain across the commodities and resources space. But we are not deterred. We see the potential for significant improvements in the underlying commodities and our key investments and are determined to see this potential translate into a higher share price.

On a more optimistic note, analysts continue to see constraints to supply and continued demand from an ever-growing green EV revolution, ranging from infrastructure expansion to cleaner iron ore production and targets for EV penetration reflected in greater demand for Lithium. Added to this, the challenge to control costs as new production is brought to market, combined with expectations that acquisition is the way forward to grow production, are factors that will continue to underpin prices of commodities exposed to the EV sector and the Cadence Minerals portfolio.

With this blueprint in place for the foreseeable future, as our portfolio matures and develops, your board will continue to seek new investment opportunities and potential new companies to focus efforts on.

The Cadence board sends the best of wishes to all portfolio companies, hoping we can all continue to weather the resource storm and arrive in calmer seas soon. I look forward to a year when commodity prices rebound and our share price start to reflect the fundamental benefits of a diversified portfolio and its potential.

Lastly, I would like to thank my fellow board members, staff, partners of the Cadence Community, and all shareholders for their continued support and confidence in our company.

Andrew Suckling

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

WH Ireland Limited (NOMAD & Broker)	+44 (0) 20 7220 1666
James Joyce
Darshan Patel Isaac Hooper

Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Link here for the CEO statement and financial statements

Cadence Minerals #KDNC – Strategic Development and Financing MOU Signed for the Amapa Iron Ore Project. Increase in Cadence Amapa Project Equity Stake

30th October 2023 / Leave a comment

Cadence Minerals (AIM/NEX: KDNC; OTC: KDNCY) is pleased to announce that our joint venture company Pedra and Branca Alliance (“PBA“) and DEV Mineração S.A. (“DEV“) have entered into a memorandum of understanding (“MOU“) with Sinoma Tianjin Cement Industry Design & Research Institute Co., Ltd. a wholly owned subsidiary of Sinoma International Engineering Co., Ltd. (“TCIDR“). Through its wholly owned subsidiary, DEV, PBA owns and operates the Amapa Iron Ore Project in Brazil (“Amapá Project“).

The MOU is the result of our ongoing discussions between the parties to progress the development of the Amapá Project jointly.

Development Programme

Under the MOU, TCIDR will provide a final proposal to complete the Definitive Feasibility Study (“DFS“), and on completion of a successful DFS, will submit a fixed price Engineering Procurement and Construction (“EPC“) contract for the Amapá Project. The DFS, EPC contact and any other services provided by TCIDR are subject to both the services being provided on a competitive basis and to PBA’s and DEV’s commercial evaluation and approval. TCIDR will be appointed the General EPC contractor for the Amapá Project once these approvals have been granted and the provision of TCIDR-facilitated project financing is secured. This will require the execution of legally binding documents.

Project Financing

Under the MOU, TCIDR will use its best commercial efforts to secure the required financing for the construction and re-development of the Amapá Project, including the necessary guarantees, project finance insurance and debt financing. In this regard, TCIDR is in discussion with SinoSure China Export & Credit Insurance Corporation and China Development Bank.

PBA, DEV and TCIDR will now develop a roadmap to seek to secure the financing for the DFS and subsequent project financing for the Amapá Project, and a fixed price EPC contract between DEV and TCIDR that will have the project finance, export credit insurance and credit support by TCIDR.

Cadence Increase in Ownership in the Amapá Project

Up to the end of September 2023, Cadence’s total investment in the Amapá Project stood at approximately US$12.1 million; as a result, Cadence’s equity stake in the project has increased to 32.6%.

Cadence Chairman Andrew Suckling commented: “This Cadence Minerals management team, of which I am proud to be part, have worked tirelessly with PBA and DEV, local Government and contractors to bring Amapá to this point. Investments of this nature are rarely straightforward, but our management and shareholders are now starting to see a tangible return from bringing this large and complex infrastructure back to life. Along with Kiran, I have witnessed firsthand the rejuvenating effect the recommissioning process has had on the region and community, and now, with this MOU, there is a real sense that we can re-develop this project back to its name plate capacity.

Cadence CEO Kiran Morzaria added: “From a strategic standpoint, for Cadence and PBA, the MOU with TCIDR represents a potential one-stop shop solution, coupling our requirements for final project funding with engineering, construction and technical expertise. Following this, our next steps will be the completion of the remaining optimisation studies followed by the DFS.”

“Our investment to date has resulted in an increased shareholding, which now stands at 32.6%, and I am both pleased and proud that having first submitted a judicial restructuring plan to creditors in 2019, we are now making rapid progress. I and my colleagues look forward to the completion and recommissioning of this substantial project.”

About the Amapá Iron Ore Project

The Amapá Project is a brownfield integrated iron ore project in the Amapá State of Brazil. It has Mineral Resources of 276 million tonnes (Mt) at 38.33% Iron (Fe) and Ore Reserves of 196 Mt at 39.34%. The project consists of the mine, processing plant, wholly owned port and a 194km railway, all of which will be operated by DEV. A Pre-Feasibility Study (“PFS”) was published in January 2023. The PFS delivered a Post-tax Net Present Value of US$949 million (“M”) at a discount rate of 10% and a post-tax Internal Rate of Return of 34%, with an average annual life of mine EBITDA of US$235 M annually. After ramp-up, the planned yearly average production will be 5.7 million wet metric tonnes per annum (“Mtpa”) of Fe concentrate, consisting of 4.7 Mtpa at 65.4% Fe and 1 Mtpa at 62% Fe concentrate.

About Sinoma Tianjin Cement Industry Design & Research Institute Co., Ltd

TCIDR is a wholly owned subsiduairy of SINOMA International Engineering Co., Ltd. (“SINOMA International”) is the technology and engineering platform under the Fortune Global 500 Group – China National Building Material Group Co., Ltd. It is also the world’s leading service provider for cement technology, equipment and engineering system integration, a high-tech and technological innovation demonstration enterprise of China, as well as one of the “Going Global” benchmarking enterprises recognized by the State-owned Assets Supervision and Administration Commission of the State Council.

In 2001, SINOMA International was established by integrating the quality assets of China’s cement technology, equipment and engineering business. In 2005, it was listed on the Shanghai Stock Exchange (600970 SH). Through technology import, assimilation, and independent innovation, the company has developed and built a series of production lines starting from China’s first production line with a daily output of 1,000 tons to the world’s largest production line with a daily output of 14,000 tons.

Over the past 20 years, SINOMA International has positioned itself as an “innovative, international and value-oriented” company, SINOMA International has so far won contracts for nearly 300 cement productions lines in more than 80 countries .

For further information contact:
Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria

WH Ireland Limited (NOMAD & Broker)	+44 (0) 20 7220 1666
James Joyce
Darshan Patel

Fortified Securities – Joint Broker	+44 (0) 20 3411 7773
Guy Wheatley

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Qualified Person

Cautionary and Forward-Looking Statements

Certain statements in this announcement are or may be deemed to be forward-looking statements. Forward-looking statements are identiﬁed by their use of terms and phrases such as “believe”, “could”, “should”, “envisage”, “estimate”, “intend”, “may”, “plan”, “will”, or the negative of those variations or comparable expressions including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the company’s future growth results of operations performance, future capital, and other expenditures (including the amount, nature, and sources of funding thereof) competitive advantages business prospects and opportunities. Such forward-looking statements reﬂect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. Many factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes actions by governmental authorities, the availability of capital markets reliance on key personnel uninsured and underinsured losses and other factors many of which are beyond the control of the company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions. The company cannot assure investors that actual results will be consistent with such forward-looking statements.

The information contained within this announcement is deemed by the company to constitute Inside Information as stipulated under the Market Abuse Regulation (E.U.) No. 596/2014, as it forms part of U.K. domestic law under the European Union (Withdrawal) Act 2018, as amended. Upon the publication of this announcement via a regulatory information service, this information is considered to be in the public domain.

Cadence Minerals #KDNC – Interim Results for the Six Months Ended 30 June 2023

29th September 2023 / Leave a comment

Cadence Minerals plc (AIM/AQX: KDNC) is pleased to announce its interim results for the six months ended 30 June 2023.

HIGHLIGHTS

Amapá Pre-Feasibility Study (“PFS”) completed. The study established that the Amapá mine has potential to deliver a robust 5.28 Mtpa (dry) iron ore operation & excellent cash flow including a post-tax NPV of US$949 million.
Amapá Mineral Resource Estimate (MRE) increased and upgraded. Total Measured, Indicated and Inferred MRE increased to 276.24 million tonnes grading 38.33% Fe and a maiden Measured Resource of 55.33 Mt grading 39.26% Fe.
Scoping study identified changes and cost savings in Santana Port layout & refurbishment of US$28m.
Progress with equity investments including ASX listed Evergreen Lithium (ASX: EG1), Hastings Technology Metals (ASX: HAS) and AIM listed European Metals Holdings (AIM: EMH).
Reduced LBT of £1.95m (6 months ended 30 June 2022: £5.05m, Y/E 31 Dec 2022: £5.50m)
Total group assets increased from £21.64m at 31 December 2022 to £25.79m at 30 June 2023.

CEO Kiran Morzaria commented: “Faced with unprecedented geopolitical challenges and challenging global markets, your Board are pleased to deliver reduced losses and an increase in group assets at the half year. Our flagship Amapá project is developing at pace, and we have seen the MRE increase combine with costs savings at the Santana port to deliver material growth in our investment. Our considered opinion, and that of several analysts during the first half of 2023 is that these developments, along with our investments in Evergreen, Hastings Tech Metals, European Metals and Sonora have yet to be reflected in our market valuation. We hope that our progress will be in some way reflected during the second half of the year.”

“I look forward to reporting back on further progress.”

INVESTMENT REVIEW

Our public portfolio was bolstered during the period as our private investments Evergreen Lithium and in the Yangibana Rare Earth deposit were converted into equity in public listed entities. However, the performance of our equity in stake in Hastings Technology Metals (converted from our stake in the Yangibana Rare Earth Deposit) weighed down the overall performance of our public portfolio and is detailed in the review of our public listed portfolio.

As stated in our annual report and accounts the overall ambition of the portfolio is capital growth of the assets under management which should be reflected in Cadence’s share price. We intend to fund this growth, where possible, by investing in undervalued assets, selling these investments at higher valuations, and reinvesting the proceeds. Once we reach critical mass in terms of assets under management, this investment cycle will mitigate the need for outside capital, either in new equity or debt.

As stated in our annual report, the overall ambition of the portfolio is capital growth of the assets under management, which should then be reflected in Cadence’s share price. We intend to fund this growth, where possible, by investing in undervalued assets, selling these investments at higher valuations, and reinvesting the proceeds. Once we reach critical mass in terms of assets under management, this investment cycle will mitigate the need for outside capital, either in new equity or debt.

PRIVATE INVESTMENTS, ACTIVE

The Amapá Iron Ore Project, Brazil

Interest – 30% at 30/06/2022 and 29/09/2023

The Amapá Project is a large-scale iron ore mine with associated rail, port and beneficiation facilities that commenced operations in December 2007. The project ceased operations in 2014 after the port facility suffered a geotechnical failure, which limited iron ore export. Before the cessation of operations, the project generated an underlying profit of US$54 million in 2012 and US$120 million in 2011. Operations commenced in December 2007, and in 2008, the project produced 712 thousand tonnes of iron ore concentrate. Production steadily increased, producing 4.8 Mt and 6.1 Mt of iron ore concentrate products in 2011 and 2012, respectively.

Investment

In 2019, Cadence entered into a binding investment agreement to invest in and acquire up to 27% of the Amapá iron ore mine, beneficiation plant, railway and private port owned by a Brazilian company DEV Mineração S.A. The agreement also gave Cadence the first right of refusal to increase its stake to 49%. To acquire its 27% interest, Cadence invested US$6 million over two stages in a joint venture company; this was completed in the first quarter of 2022. In October 2022, we increased this stake to 30%. At the end of the reporting period, the total investment was US$11.02 million, which, once fully converted to equity, will represent some 31.6% of the Amapá Project.

Operations Review

During the reporting period our we made considerable progress at the Amapá Project. The PFS was completed early in the year, this was followed by the port optimisation study. Post period end it was agreed that the following completion of the Amapá PFS, the remaining operational focus for the year should include progressing the permitting pathway and the completion of the regulatory requirements for the mining concessions, tailing storage facilities and the environmental permits.

Pre-Feasibility Study & Optimisation Studies

As part of the PFS, we upgraded and increased the Amapá Project Mineral Resource Estimate. This resulted in a substantial increase in total Measured, Indicated and Inferred Mineral Resources to 276.24 million tonnes grading 38.33% Fe and a maiden Measured Resource of 55.33 Mt grading 39.26% Fe.

The PFS results were announced in early January 2023. The PFS confirmed the potential for the Amapá Iron Ore Project to produce a high-grade iron ore concentrate and generate strong returns over the life of mine. It delivered a robust 5.28 Mtpa (dry) operation, which can provide excellent cash flows and a post-tax NPV of US$949 million.

The Key Highlights of the PFS are below:

Annual average production of 5.28 million dry metric tonnes per annum (“Mtpa”) of Fe concentrate, consisting of 4.36 Mtpa at 65.4% Fe and 0.92 Mtpa at 62% Fe concentrate.
Post-tax Net Present Value (“NPV”) of US$949 million (“M”) at a discount rate of 10%.
Post-tax Internal Rate of Return of 34%, with an average annual life of mine EBITDA of US$235 M annually
Maiden Ore Reserve of 195.8 million tonnes (“Mt”) at 39.34% Fe demonstrates an 85% Mineral Resource conversion.
Free on Board (“FOB”) C1 Cash Costs of US$35.53/dmt at the port of Santana. Cost and Freight (“CFR”) C1 Cash Costs US$64.23/dmt in China.
Pre-production capital cost estimate of US$399 million, including the improvement and rehabilitation of the processing facility and the restoration of the railway and the wholly owned port export facility

Based on the positive outcome of the PFS and subsequent consultations with the key contractors, three areas of possible improvement to the Amapá Project were identified. The first was to review the historical drilling and geological data north of the Amapá mining concessions. The data was acquired, and work began; however, the owner of these mining concessions filed for judicial recovery, so the timing of this is likely to be delayed. We are investigating other ways to progress this work, including conducting a topography survey of the areas.

The second area of potential improvement is a change in the layout of the port at Santana by moving the railway loop further from the shore. A scoping study regarding this option was completed during the period and identified a potential net capital saving to the port refurbishment costs of US$28 million.

The last area of potential improvement is to investigate and review the flowsheet to improve the final product quality over and above the current 65% iron ore concentrate or reduce the operating costs. From initial reviews, it appears that the most viable option will be to reduce the operational costs. We are looking to appoint an engineer to complete this work in the coming months.

Once these studies are completed, work on a Definitive Feasibility Study (“DFS”) can begin. The DFS is required to seek project debt and equity finance, which will be sought once the DFS is complete.

Permitting Pathway & Tailings Storage Facility

While the Amapá Project was operating, it held all the necessary permissions to mine, process, transport and ship some six million tonnes of iron ore annually. However, many of these licenses lapsed after it ceased operations in 2014. Cadence has been working alongside the team at the Amapá Project to obtain these licenses and permissions. To date, we have reinstated and extended the railway concession to 2046 (completed in December 2019) and been granted a change of control over the wholly owned port in November 2021, which ensured the federal licenses could be maintained.

The Amapá Project owns the required Mining Concessions; however, it must obtain a Mine Extraction and Processing Permit (“Mining Permit”) to begin operation. To get this permit, the Amapá Project must obtain an L.I. and, when constructed, an Operational License L.O. from the Amapá State Environmental Agency.

Before the suspension of mining, the project had numerous L.O.s across the mining, rail, and port operations. These L.O.s expired between 2013 and 2018. In 2022, the Amapá Project began regularising the expired environmental permits and started consultation with the Amapá State Environmental Agency and the relevant state authorities. The Amapá Project requested that the requirement for a full environmental impact study be waived. This request for a waiver was on the basis that the previous L.O.s were granted on an operation that is substantially the same as is currently planned and remains applicable to future operations.

As a result of the discussions between the various state authorities and the Amapá Project, we agreed with the Amapá State Environmental Agency that on the mine and railway, we will be able to submit an Environmental Control Plan – “PCA” (Plano de Controle Ambiental) and an Environmental Control Report – “RCA” (Relatório de Controle Ambiental). However, we will need to complete a full environmental assessment on the port. Still, given that the Amapá Project has already begun some background studies, we also anticipate that the timeline for the grant of the port L.I. will be shortened.

The fieldwork for the L.I. will begin as soon as possible with current expectations that we will be able to submit the required reports for the mine and rail in the second quarter of 2024 and the reports for the port in the third quarter of 2024. The Amapá State Environmental Agency will then review the application for the L.I., and we anticipate that these licenses will be granted in 2024.

This timeline is substantially shorter than expected on a greenfield site, where the impact study and associated approval can typically take between 24 and 36 months. The Amapá Project could achieve this in 12 to 16 months.

One of Cadence’s initial investment criteria into the Amapá Project was the safety and stability of the TSF. As such, before entering into the investment agreement with our joint venture partners, we carried out a TSF review by an internationally recognised consultant group and were satisfied with the structure and stability of the T.S. Nonetheless, given the lack of reporting and maintenance from 2014 onwards, the TSF at the Amapá Project was considered high risk. The work carried out since 2019, including maintenance, reporting, drilling and compliance, has meant that the Amapá Project TSF is approaching the lowest risk rating for operating TSF. The intent is that the TSF will continue to improve its risk rating. This will be achieved by completing a dam break study, installing video monitoring on the TSF, and ongoing inspection and remediation of various TSF-associated infrastructure.

Secured Bank Settlement Iron Ore Shipments

As per the settlement agreement announced in December 2021 here, the net proceeds of the one shipment carried out in 2022, along with approximately half of the net proceeds from the shipments in 2021, have been used to pay the secured bank creditors.

As previously disclosed, given these unprecedented macroeconomic conditions in 2022, DEV could not meet the 2022 payment schedule per the settlement deed. Although the bank creditors have reserved their rights, the settlement deed remains in full effect. All parties are in discussions to agree on a new timetable to rephase payments or to reach a one-time payment to settle all outstanding amounts.

With the current iron ore prices and shipping costs, selling the 58% iron ore concentrate stockpile is economically viable. Although DEV can recommend material shipment, the secured bank creditors must approve it as they will receive the net proceeds of the stockpile sale. As a result of the ongoing discussions, no material shipments are scheduled to be made.

Development Plan for the Amapá Project

The goal is to bring this project back into production. With the PFS completed, a project would typically directly proceed to DFS, funding, and construction. Cadence and Its joint venture partners have agreed that the lowest risk and currently best commercial approach to developing this project is to bring on a highly experienced mining operator or EPCM contractor as a joint venture partner. We are making good progress in this regard. While we develop this further, we will continue with the optimisation studies, licensing pathway, and community engagement, which should further improve the project’s economics while reducing its risks.

PRIVATE INVESTMENTS, PASSIVE

Ferro Verde Iron Ore, Brazil

Interest – 1% at 30/06/2022 and at 29/09/2023

During the previous year, Cadence invested a small (£0.21 million) in an advanced iron ore deposit in Brazil. The Ferro Verde Deposit is located in the southern portion of the state of Bahia, in the northeastern region of Brazil, next to the town of Urandi, some 700 km southwest of Salvador, the capital of the state of Bahia.

The project is currently progressing with its DFS. It has a historic inferred resource of 284 million tonnes of iron ore at 31% Fe. The intent is to produce 4.5 Mtpa of 67% Fe. Our intended exit strategy is either when the asset is listed or the owners carry out a trade sale.

PRIVATE INVESTMENTS, PASSIVE

Sonora Lithium Project, Mexico

Interest – 30% at 30/06/2022 and at 29/09/2023

Cadence holds an interest in the Sonora Lithium Project via a 30% stake in the joint venture interests in each of Mexalit S.A. de CV (“Mexalit”) and Megalit S.A. de CV (“Megalit”).

Mexilit and Megalit form part of the Sonora Lithium Project (the “Project”). The Sonora Lithium Project consists of nine granted concessions. Two of the concessions (La Ventana, La Ventana 1) are owned 100% by subsidiaries of Ganfeng Lithium Group Co., Ltd (“Ganfeng”). El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 concessions are owned by Mexilit S.A. de C.V. (“Mexilit”), which is owned 70% by Ganfeng and 30% by Cadence. The Buenavista and San Gabriel concessions are owned by Megalit, which is owned 70% by Ganfeng and 30% by Cadence.

Ganfeng Lithium has been developing the project, consisting of an open pit mine and a lithium chemical product processing facility. The principal planned lithium product for the project is lithium hydroxide.

As previously announced, In April 2022 and May 2023, the Mexican Government approved amendments to its Mining Law (the “Mining Law Reform”), which prohibited lithium concessions, declared lithium as a strategic sector and granted the exclusive right to engage in lithium mining operations to a state-owned entity. The Mining Law Reform is not supposed to apply to pre-existing concessions, including those held by the Mexilit and Megalit. Ganfeng’s and Cadence’s position is that these reforms cannot impact the project’s concessions because they were granted before the enactment of the Mining Law Reform. This is consistent with the terms of the Constitution of Mexico, which, among other principles and rights, recognises the principles of legality and non-retroactivity of laws.

Guided by the principles of good faith, cooperation, and mutual benefit, Ganfeng has been proactively engaging with the Mexican Government in general and with the Secretary of Economy in particular, regarding a potential collaboration on the Sonora Project while respecting Ganfeng and its subsidiaries rights (including those subsidiaries 30% owned by Cadence). Ganfeng continues to seek a mutually beneficial resolution. No agreement has been reached among the Company, Ganfeng and the Mexican Government concerning this potential collaboration.

While Ganfeng was holding discussions with the Secretary of Economy, the General Directorate of Mines (“DGM”) initiated a review of nine of the lithium concessions held by the Mexican Subsidiaries, including the lithium concessions including the concessions owned by Mexilit and Megalit.

According to the DGM, if the Mexican Subsidiaries failed to submit sufficient evidence within the specified timeframe to prove that they had complied with minimum investment obligations for the development of lithium concessions in 2017-2021, there was a risk of cancellation of the above-mentioned lithium concessions.

As of May 2023, Mexlait and Megalit had submitted extensive evidence of their compliance with the minimum investment obligations of the above-mentioned lithium concessions in a timely manner. However, the DGM issued a formal decision notice to the Mexican Subsidiaries in August 2023, indicating that nine lithium concessions were cancelled, which include those owned by Mexilit and Megalit.

The lithium concessions’ cancellations issued by the DGM are not final and are subject to ongoing appeals. Ganfeng and Cadence believe that the Mexican Subsidiaries have complied with their minimum investment obligations, as required by Mexican law. Indeed, the mine development investment by the Mexican Subsidiaries has significantly exceeded the minimum investment obligations, and the Mexican Subsidiaries regularly submitted to the DGM annual reports for the 2017-2021 periods detailing their operations within the prescribed period annually.

Moreover, Ganfeng and Cadence’s position is that the resolutions cancelling the concessions violate both Mexican law and international law as they are arbitrary, unsubstantiated in both fact and law and infringe upon Cadence’s, Ganfeng’s and its Subsidiaries’ fundamental due process rights. Therefore, Ganfeng and the Mexican Subsidiaries have filed administrative review recourses before the Secretary of Economy against the aforementioned resolutions.

The lithium concessions’ cancellations issued by the DGM are not final. Depending on the progress of Ganfeng’s further actions and the outcome of the above-mentioned matters, whether cancellations will be revoked or maintained in place and the scope of the concessions affected are still uncertain.

Ganfeng’s interim results announcement published on 29 August 2023 discussed these developments as part of their post-balance sheet analysis. Therefore, there is still uncertainty about the impact on Cadence’s investment. Ganfeng is pursuing various remedies, including administrative review recourses, to challenge the DGM’s resolutions. If necessary, Ganfeng will resort to additional remedies under Mexican or international law.

Cadence will continue to liaise with our joint venture partners regularly and ensure within the limits of the joint venture agreement that the matter is given the utmost attention and that regulatory requirements are fulfilled promptly.

PUBLIC EQUITY

The public equity investment segment includes active and passive investments in our trading portfolio.

The trading portfolio consists of investments in listed mining entities that the board believes possess attractive underlying assets. The focus is to invest in mining companies that are significantly undervalued by the market and where there is substantial upside potential through exploration success and/or the development of mining projects for commercial production. Ultimately, the aim is to make capital gains in the short to medium term. Investments are considered individually based on various criteria and are typically traded on the TSX, ASX, AIM or LSE.

During the period, our public equity investments generated an unrealised and realised loss of £1.53million (2022: loss of £4.15 million). These unrealised losses are a reflection of the transfer of the receipt of Hastings Technology Metals Ltd’s (“HAS”) equity at the market value (£ 5.15 million) and then the subsequent reduction in share price in HAS by circa 66%. However, the treatment of the mineral license swap of the Yangibana Rare Earth Deposit into the equity of HAS is due to Cadence reporting on an unconsolidated basis. Assuming the returns were reported on a consolidated basis, we would have reported an unrelaised / realised profit of £2.17 million, with roughly £0.93 million gain being attributed to improvements in the price and profits from sales of European Metals Holdings share price (“EMH”), £0.93 million is attributed to the net improvement in the Evergreen Lithium Share Price (“E.G.”) and £0.75 million being attributed to the gain in price associated with the Yagibana Rare Earth License swap into HAS.

If we look at the cumulative share performance of this portfolio at the end of the period, the realised return on historical costs is circa 143%, and the unrealised return is 149%. Our investment in EMH is the only active investment in the public equity portfolio.

The movement in public portfolio values during the year is summarised below. We have reported for clarity the unconsolidated and consolidated values and movements. Our disposals in our pubic equity were invested in the Amapá Project.

	£,000 (Unconsolidated)	£,000 (Consolidated)
Portfolio value at the beginning of period of 2023	5,244	5,244
Addition of HAS shares at market value	5,152	NA
Transfer of HAS from private to public portfolio	NA	905
Transfer of E.G. from private to public portfolio	1,810	1,810
Disposal of public Investments during the year	(935)	(935)
Realised and Unrealised (loss) / profit on portfolio value for the period	(1,532)	2,715
Portfolio value at the end of the period	9,740	9,740

As of 30 June 2023, our public equity stakes consisted of the following:

Company	30-Jun-23 £,000	31-Dec-22 £,000	30-Jun-22 £,000	31-Dec-21 £,000	30-Jun-21 £,000
European Metals Holding Ltd	5,207	4,882	5,357	11,287	14,180
Evergreen Lithium Ltd	2,738	–	–	–	–
Hastings Technology Metals Ltd	1,570	–	–	–	–
Charger Metals NL	187	301	196	342	109
Macarthur Minerals Ltd	–	–	103	181	327
Eagle Mountain Mining Ltd	20	37	47	122	153
Mont-Royal Resources Ltd	12	19	39	35	–
Celsius Resources Ltd	–	–	–	–	103
Miscellaneous	5	5	5	7	6
Total	9,740	5,244	5,747	11,974	14,878

PUBLIC EQUITY, ACTIVE

European Metals Holdings Limited (“EMH”), Czech Republic

Interest – 6.2% at 30/06/2022 and 5.8% at 29/09/2023

EMH owns 49% of Geomet s.r.o. with 51% owned by CEZ. CEZ is a significant energy group listed on various European Exchanges. Geomet s.r.o. owns 100% of Cinovec, which hosts a globally substantial hard-rock lithium deposit with a total Measured, Indicated and Inferred Mineral Resource of 708.2Mt at 0.43% Li2O and 0.05% Sn containing a combined 7.39 million tonnes of Lithium Carbonate Equivalent.

This followed previous reports on 28 November 2017 (Further Increase in Indicated Resource at Cinovec South). An initial Probable Ore Reserve of 34.5Mt at 0.65% Li2O and 0.09% Sn reported on 4 July 2017 (Cinovec Maiden Ore Reserve – Further Information) has been declared to cover the first 20 years’ mining at an output of 22,500tpa of battery-grade lithium carbonate reported on 11 July 2018 (Cinovec Production Modelled to Increase to 22,500tpa of Lithium Carbonate). This makes Cinovec the largest hard-rock lithium deposit in Europe, the fourth largest non-brine deposit globally, and a globally significant tin resource.

In January 2022, EMH completed an updated PFS, which indicated a return post-tax NPV8 of USD1.94B and a post-tax IRR of 36.3%. The study confirmed that the Cinovec Project is a potential low-operating-cost producer of battery-grade lithium hydroxide or battery-grade lithium carbonate as markets demand. It confirmed that the deposit is amenable to bulk underground mining. Metallurgical test work has produced battery-grade lithium hydroxide and lithium carbonate in addition to high-grade tin concentrate. A DFS for the Cinovec Project is currently underway.

For the reporting period, EMH continued to manage the advancement of the Cinovec Lithium/Tin Project in the Czech Republic. The Cinovec project was awarded pre-approval for an ~ EUR 49 million grant under the E.U.’s Just Transition Fund scheme in January 2023 and was formally classified as a “Strategic Project” as part of this grant scheme. The final application and approval process is due to be completed in early 2024.

Other key milestones achieved during the year included the appointment of DRA Global to complete the DFS, the continuation of outstanding results from the final test work, and securing the land necessary to build the proposed lithium processing plant at Dukla, approximately 6.2km from the proposed portal site.

Post-period end, EMH received an investment from a significant strategic investor, the European Bank for Reconstruction and Development (“EBRD”). The EBRD is an International Financial Institution owned by the European Union, the European Investment Bank and 71 countries, including the Czech Republic. The EBRD investment aims to fund the project’s predevelopment work.

PUBLIC EQUITY, PASSIVE

Evergreen Lithium Limited (“EG”), Australia

Interest – 13.2% at 30/06/2022 and 8.7% at 29/09/2023

In July 2022, Cadence Minerals received approximately 15.8 million shares in EG when Cadence sold its 31.5% stake in Lithium Technologies and Lithium Supplies (“L.T. and L.S.”) to EG as announced on 27 June 2022. EG was listed on the Australian Stock Exchange (“ASX”) during the reporting period.

Before listing, Cadence’s equity stake in Evergreen was 13.16%; due to the IPO and associated fundraising, this was reduced to 8.74%. At the time of writing, the value of this stake was approximately £3.3 million; our initial investment into this asset was £0.83 million.

A further AS$ 6.63 million (£3.80 million) shares in Evergreen are due to Cadence on achieving certain performance milestones by Evergreen. Further details of these milestones can be found in the Evergreen prospectus. Cadence’s shares are subject to a 2-year escrow agreement as determined by the listing rules of the ASX.

Evergreen is the 100% owner of three exploration tenements. The Bynoe Lithium Project and Fortune Lithium Project (awaiting grant of exploration permit) are in the Northern Territory, and the Kenny Lithium Project is in Western Australia.

The Bynoe Lithium Project is Evergreen’s flagship prospect. Evergreen’s primary focus is to explore and discover an economically viable lithium resource for development. The Bynoe Lithium Project is located south of Darwin in the Northern Territory, Australia. It covers the northeastern strike extent of the lithium- and tantalum-endowed Bynoe Pegmatite Field. The Bynoe Pegmatite Field is host to Core Lithium Ltd’s (ASX: CXO) (“Core Lithium” or “Core”) high-grade Finniss lithium deposit, which is adjacent to Core Lithium’s producing lithium mine. Core Lithium’s deposit is just 1.2km from the Bynoe Lithium Project. Soil sampling conducted on the Bynoe Lithium Project has returned geochemical anomalies that indicate the lithium mineralisation continues along the trend into the Company’s

Bynoe Lithium Project. Based on the initial stages of soil sampling alone (which only covers approximately 10- 20% of the Bynoe Lithium Project area, an initial five target zones have been identified that contain lithium mineralisation. The Bynoe Lithium Project covers an area of 231 km2, making Evergreen one of the largest tenement holders within the central Bynoe Pegmatite Field after Core Lithium.

The Kenny Lithium Project is located within the Dundas Mineral Field of Western Australia and 50km East of Norseman in the Eastern Goldfields. It is near the Mt Dean and Mt Belches-Bald Hill pegmatite fields, and multiple significant lithium discoveries have been made near the Kenny Lithium Project.

Initial field mapping on the Kenny Lithium Project has confirmed the presence of substantial outcropping pegmatites, whereby an approximate 10km zone of pegmatite outcropping has been established in the North- Eastern section of the Kenny Lithium Project, which significantly exceeds what has already been identified by the Government Survey of Western Australia (GSWA).

Evergreen aims to explore and discover an economic lithium resource for subsequent development. As with the Company’s Bynoe Lithium Project, minimal geochemical work has been undertaken within the tenure; however, historical results have proven encouraging. During the reporting period, EG has continued to progress with the development of these assets, with some initial positive results from the geochemical and geophysical results on both the Byone and Kenny lithium prospects.

PUBLIC EQUITY, PASSIVE

Hastings Technology Metals Ltd (“HAS”), Australia

Interest – 1.4% at 30/06/2022 and 1.4% on 29/09/2023

In June 2022, Cadence entered into a binding agreement to sell its working interest in the leases in the Yangibana Project to HAS, the current owner and operator of the Yangibana Rare Project. Cadence sold its 30% working interest in the Yangibana Project tenements, to Hastings, for A$9 million (£5.1 million), which has been satisfied via the issue of 2,452,650 new ordinary shares in Hastings to Cadence. These shares represented approximately 1.9% of the issued share capital of Hastings Technology and are subject to a 12-month voluntary escrow. Cadence has disposed of some of this investment to fund our investment in the Amapá Iron Ore Project, holding circa 1.4% of HAS. Amapa. At the period end, the value of this stake was approximately £1.6 million; our initial investment in this asset was £0.91 million.

Hastings is a well-managed Perth-based rare earth company primed to become the world’s next producer of neodymium and praseodymium concentrate (“NdPr”). NdPr is vital in manufacturing permanent magnets used daily in advanced technology products ranging from electric vehicles to wind turbines, robotics, medical applications and digital devices.

Hasting’s flagship Yangibana project, in the Gascoyne region of Western Australia, contains a highly valued NdPr deposit with an NdPr: TREO ratio of up to 52%. The site is permitted for long-life production and with offtake contracts signed and debt finance in an advanced stage.

During the period Hastings announced it had introduced a staged development programme to the Yangibana asset. This strategy will reduce upfront capital requirements and project execution risks and provide a faster pathway to cash flow by Q1 2025. Hastings will initially focus on constructing the Yangibana mine and beneficiation plant to produce rare earths concentrate (Stage 1), followed by developing a hydrometallurgical plant to produce mixed rare earth carbonate (Stage 2). This has resulted in the total project capital cost being estimated at $948m, with the Stage 1 component being $470m. The beneficiation plant construction will commence in Q3 2023, supporting the Stage 1 concentrate delivery target date of Q1 2025.

As a result of this staged development programme, Stage 1 will have a post-tax NPV11 of $538m, an IRR of 27.54% and an average annual EBITDA of $174m, providing a funding source for Stage 2.

FINANCIAL RESULTS:

During the period, the Group made a loss before taxation of £1.95 million (6 months ended 30 June 2022: £5.05 million, year ended 31 December 2022: £5.50 million). There was a weighted basic loss per share of 1.163p (30 June 2022: 3.136p, 31 December 2022: 3.355p). During the period, the Group disposed of its Yangibana Joint Venture Interest. This interest was held in the Company’s wholly owned subsidiary, Mojito Resources “Mojito” which acquired 2,452,650 shares in Hastings Technology Metals Ltd in return valued at AUD $9m. Therefore, the sale’s profit is reflected in the subsidiary, not the Company’s accounts. Mojito, in turn, sold these shares to the Company for $9m, which resulted in an amount owing to the subsidiary of £4.75m at the period end in the Company’s accounts. This transaction constitutes a related party transaction. The Company currently holds an investment in Mojito of £0.96m, supported by the intercompany balance of £4.75m. Should the intercompany loan be waived this would result in a profit of approximately £3.79m, based on the balances at 30 June 2023, for the Company.

The total assets of the Group increased from £21.64 million at 31 December 2022 to £25.79 million. During the period, our net cash outflow from operating activities was £0.76 million, gross proceeds of £1.31m were raised through the issue of loans and new shares, and our net cash position was up £0.47 million at £0.58 million.

Kiran Morzaria

Director

29 September 2023

This announcement contains inside information for the purposes of Article 7 of E.U. Regulation 596/2014.

For further information:

Cadence Minerals plc	+44 (0) 20 3582 6636
Andrew Suckling
Kiran Morzaria
WH Ireland Limited (NOMAD & Broker)	+44 (0) 207 220 1666
James Joyce
Darshan Patel

Brand Communications	+44 (0) 7976 431608
Public & Investor Relations
Alan Green

Cadence Minerals #KDNC – Annual Results year ended 31 December 2022

27th June 2023 / Leave a comment

Cadence Minerals (AIM/NEX: KDNC) is pleased to announce its final results for the year ending 31 December 2022. The full Annual Report and Audited Financial Statements will be available on the Company’s website at https://www.cadenceminerals.com/ and posted to shareholders by 30 June 2023.

CHAIRMAN’S STATEMENT

I am pleased to present the Company’s Annual Report and Audited Financial Statements for the year ended 31 December 2022.

The global macroeconomic outlook continues to be unpredictable and difficult to navigate. The expected recovery and bounce back from pandemic-era conditions have largely been tempered by fast-rising interest rate and inflation forecasts. Coupled with an increasing focus on China’s status as an adversary rather than just a competitor, the global outlook remains mixed and confusing. Over a year has passed, and the Ukraine invasion has now become an entrenched war, with many of the initial supply disruptions looking set to become semi-permanent dislocations. The Cadence Minerals portfolio is both balanced, diversified and constructed to anticipate supply and demand shocks. As such it should be well placed to weather this ongoing uncertainty.

Although the above suggests caution and a degree of pessimism, there are actual positives emerging. Recent economic forecasts suggest continued stimulus and support for infrastructure projects globally. Inflation, by some metrics, may have peaked, and the transformation to an EV world is gaining even more momentum. Recent merger and acquisition activity suggests an increasing awareness among multinational companies to integrate critical and strategic materials into their respective portfolios.

Market observers will be aware of an increase in the number of potential nationalisations across specific strategic industries and the resources sector. The net result is of course a greater focus on the resource sector, particularly while major resource companies continue to ramp up capital allocation into the EV material space to meet the sea change in demand for raw materials.

On behalf of the Board of Directors (Board) and management, I thank all our advisors, consultants, service providers, and especially our shareholders for their support throughout the year. The Board and company have continued site visits, viewed potential investment opportunities, and attended many industry conferences.

I am always reminded never to approach a marathon by counting every inch; it is a very hard way to keep and maintain perspective. Investing in the resource space really is a marathon versus a sprint. In every area, it continues to surprise how long permitting, licenses approvals, environmental studies, and raising capital can take.

Many times, the Board has stated “we will look for opportunities to unlock and discover value across our portfolio.” I am particularly grateful that our patience has been rewarded with the continued success and maturing of many of our portfolio companies. The successful listing on the ASX of Evergreen Lithium is a good case in point and the Board sends its congratulations to all who made that listing possible.

The Board sees further potential within our private and public holdings for further listings and potential transactional activity to bolster Company returns. In the wake of such a challenging year, we send our congratulations and support to our portfolio companies for their continued success. As the Cadence investment portfolio continues to mature, we will continue our search for new, accretive investments with the same methodology and rigorous diligence as before in order to assure a continued supply of diversified growth opportunities.

We have a clear path ahead for our flagship Iron Ore investment at Amapa, Brazil. The publication of initial and preliminary studies, and the DEV team’s liaison with federal, state, and local authorities, continues to unlock the potential of this project. The Board thanks our JV partner, lawyers, and consultants for their hard work in negotiations, settlements, and the operational success emanating from this investment.

The challenge of a dislocated economic recovery and the prospect of a slowing Chinese economy, highlighted by the likelihood of steel production at or below one billion tons, has proved to be a continual challenge to the Cadence share price. However, due to the likelihood of support and stimulus coupled with acquisition and investment in the resources sector, (particularly related to the EV transition), we expect the constitution of the Cadence portfolio to remain robust and focussed on the strategic and critical sectors of the economy.

I would like to personally thank my fellow Board members, staff, and partners, all of whom constitute the Cadence Community and, of course, all of our shareholders for their encouragement and continued confidence in the company

Andrew Suckling

Non-Executive Chairman

CHIEF EXECUTIVE OFFICER SUMMARY

I am pleased to present the audited results for the year ended 31 December 2022, along with the Strategic Report that provides a comprehensive review of our business activities during the year. It is important to note that these results reflect the historical position of the Company’s progress and financial standing, and we have included additional information on key post-year-end events in the Strategic Report.

In reviewing the performance of Cadence during the year, it would be fair to say that our two portfolios performed quite differently despite the solid operational performance of the underlying assets and the long-term outlook of the commodities these projects intend to extract. While we delivered excellent operational results and strong investment returns within our private portfolio, our public traded portfolio decreased substantially, despite the underlying assets delivering to their goals.

In our private portfolio, the Amapá iron ore project remained the primary focus for Cadence’s management. In my capacity as a director of the joint venture, Cadence was heavily involved in the operational progress we have seen to date, which cumulated in the delivery of a robust Pre-Feasibility Study (“PFS”), which confirmed the project’s strong economics. To date, our investment has been circa US$9.3 million for 30% of the Amapá iron ore project; the net present value of 100% was estimated in the PFS at US$949 million.

In addition to the progress made at Amapá, the Company increased the investment returns by converting some of its passive private investments into public traded equity. These returns were achieved via two asset sales, firstly our 31.5% interests in Lithium Technology Pty Ltd and Lithium Supplies Pty Ltd (“LT and LS”) were sold to Evergreen Lithium, and secondly, our 30% interest in licenses within the Yangibana Rare Earth Project (“Yangibana Project”) were sold to owner/operator Hastings Technology Metals. These transactions were completed after a year-end, so the financial returns are not reflected in these financial statements. Cadence has invested approximately £1.7 million in these assets, and our sale price into the equity of the two public companies was the equivalent of £7.4 million, representing a 335% cumulative return on our investments.

In contrast to these achievements, the performance of our publicly listed portfolio tracked our largest holding, European Metals Holdings (“EMH”), which was down some 49% over the year despite the excellent progress made in developing the asset. EMH’s price depreciation came off multi-year highs achieved during 2021 and followed the general trend of the AIM basic resource index, which was also down year on year, reflecting the risk-off approach we have seen with investors since mid-Aug 2021.

These negative year-over-year returns contradict the fundamental drivers in our portfolio, namely the incredible growth of the lithium raw material market and the stabilisation of the iron ore market. Therefore, the driver for the lacklustre performance appears to be a weakening in equity funds flow. Investment fund flows were the weakest in eight years as investors turned their backs on UK equity funds in 2022, selling a record £8.38 billion. In summary, Investors have sold UK equity and sought the safest havens, taking refuge in cash and perceived lower-risk investments.

As previously stated, the lithium market has continued to expand rapidly. The global lithium-ion battery manufacturing industry’s expansion to feed the transportation sector’s electrification fuelled this growth. This expansion results from a concerted shift toward decarbonisation and net zero targets set by the private sector and governments worldwide. The IEA predicts that demand for EV batteries will rise from around 340 Gigawatt hours (GWh) today to over 3,500 GWh by 2030, with the industry requiring 50 additional lithium mines by then. These macro drivers should continue to support the fundamentals behind our lithium and rare earth investments.

Within the iron ore market, although we saw a softening in the first of the year, it recovered by the end of 2022, with the 62% Fe Platts closing at circa US$117 per dry metric tonne (“dmt”). Both short and longer-term prospects for iron ore are driven by China, given that the nation is the world’s biggest steel producer and currently buys about 70% of global seaborne iron ore.

In the coming year, we look forward to further developing the Amapa Iron Ore project, progressing the permitting pathway, and, if possible, securing a joint venture partner to co-develop the asset.

With our other investments, we look forward to developments at Evergreen Lithium, which given its proximity to the Finnis project, represents the most prospective investment in our portfolio. Hastings and EMH are well advanced in their development cycle, and we look forward to seeing the construction of the beneficiation plant at Hastings in Q3 of this year and the publication of the EMH Definitive Feasibility Study in Q4 of this year.

As discussed in the Investment Review, Cadence’s ambition is to mitigate the need for external capital by growing and reinvesting the profits from our assets under management. We believe we are on our way to achieving this goal with our investments over the last three years of £8.64 million being funded by £7.77 million of sales in our public portfolio and £0.87 million from equity capital. Excluding the equity funding for our investments over the last three years Cadence has raised a total net funding from external sources of £3.72 million. At the time of writing, the realised profit since inception from the current public portfolio is £5.27 million and a total unrealised and realised gain is 338%.

I want to express my gratitude to the Cadence team and our investee companies, who have all worked tirelessly to bring the Company and its investment to their current position. We believe concentrating risk across a few crucial assets and commodities will pay off.

Kiran Morzaria

Chief Executive Officer

Link here for Investment Review and Financial Statements

Cadence Minerals #KDNC – Annual Results for the year ended 31 December 2021

21st June 2022 / Leave a comment

Cadence Minerals (AIM/NEX: KDNC) is pleased to announce its final results for the year ended 31 December 2021. The full Annual Report and Audited Financial Statements will be made available on the Company’s website at https://www.cadenceminerals.com/ and will be posted to shareholders on the 30 June 2022

CHAIRMAN’S STATEMENT

I am pleased to present the Company’s Annual Results for the year ended 31 December 2021.

Maintaining a balanced perspective on the macro picture has become increasingly difficult, with unexpected factors such as Russia’s invasion of Ukraine creating a supply and price squeeze for many commodities. As I review the year and reflect on global events, and again on events more specific to our company outlook, it is remarkable how the macro backdrop has changed in totally unexpected ways. Previously unprecedented levels of economic stimulus have now been overtaken by inflation and interest rate hikes, while the shift towards globalisation has slowed down with the prospect of a localised war in Ukraine becoming more entrenched and widespread.

On behalf of the Board of Directors (Board) and management, I would like to thank all of our advisors, consultants and service providers and especially our shareholders for their support throughout the year. The Board and company have resumed pre pandemic work schedules and trips to visit site and project operational hubs, along with viewing potential investment opportunities and attending industry conferences. The opportunity to travel freely, to reconnect with people in person and to see projects in transition has truly been a highlight.

Our portfolio companies have continued to progress and have in many cases delivered landmark achievements. In no order of priority, the Board congratulates Macarthur Minerals on completing the Bankable Feasibility Study and moving significantly closer to operational success. European Metal Holdings has painstakingly continued to complete reviews and studies that highlight its low carbon footprint while it evolves into the largest hard rock lithium producer in Europe. As I have already stated, we continue to look for opportunities to unlock and discover value across our whole portfolio. Given the increased underlying prices of Lithium and Rare Earths we expect to be able to take advantage of these opportunities in the coming year. Recent announcements from the current Mexican Government over potentially controlling the nation’s domestic Lithium supply have in no way put paid to our hopes that Bacanora’s JV with Gangfeng will prove to be a success.

Of course, the highlight of the year was the formalising and successful settlement of the ‘pending’ investment into the Company’s flagship Iron Ore Project at Amapa, Brazil. This process triggered the release of escrow funds to realise our investment, which then became a physical manifestation of the same when Iron Ore shipments commenced from the Stockpile at the Port of Santana. I write this after returning from a truly inspirational visit to see the project operations, and after viewing the port, railway and mine assets in Macapa (the Amapa system). Our investment there has also precipitated a transformation in the area’s infrastructure, which will in time make a difference to the standard of living for the local people. Although this process has only just begun, early findings from our commissioned studies and reports are increasingly positive, giving the Board every confidence that our investment there will be a great and lasting success.

On a practical level, challenges still persist today, with global disruption to shipping and freight rates, along with increased costs associated with the capital and equipment required to bring projects into production. While Cadence is not alone in facing these challenges, your Board firmly believes we remain well positioned in the underlying commodity markets that reflect the Cadence portfolio. China continues to be the dominant focus of so much global supply and demand analysis, and with the prolonged lockdowns many commentators have expressed concern about economic expansion in the region. Initial analysis still suggests that economic stimulus and infrastructure spending will continue, and this, together with the Biden $1 trillion infrastructure bill passed in November, will help sustain steel demand and therefore continue to support the demand for Iron ore, a key focus for Cadence.

As the impact of the pandemic begins to recede, we face new challenges of higher interest rates and inflation. For Cadence, sustained higher commodity prices especially those of Lithium and Iron Ore has remained one of the great positives across our portfolio, and together with the successful settlement and initial investment into the Amapa project, your Board believes we continue to be well placed to meet these challenges, both present and future.

In closing, I would like to personally thank my fellow Board members, staff and partners in the wider Cadence Community and of course all Shareholders for their continued encouragement and confidence in the Company.

Andrew Suckling

Non-Executive Chairman

CHIEF EXECUTIVE OFFICER’S COMMENTARY

I am pleased to present Annual Results for the year ended 31 December 2021, a full review of business activities during the year is provided within the Strategic Report.

The results presented for the period ended 31 December 2021 reflect a historical position in terms of the Company’s progress and financial position, therefore we have included additional information on key post-year-end events in the Strategic Report.

Cadence has continued to pursue its strategic objectives despite the continued volatility in 2021 because we think that assets that are undervalued, de-risked, or have strategic advantages will outperform their peers in the long run. This plan yielded fruit in 2021, with the Company continuing to report profitable returns on its public investments and significant operation progress being made across its core investments.

The relaxation of Covid-19 restrictions, combined with the implementation of mass vaccination programmes and significant levels of monetary and fiscal stimulus by many governments around the world, resulted in a rapid resurgence of global economic activity in 2021: the IMF estimates 5.9 percent global growth for the year. The magnitude of this economic recovery was most pronounced in Europe and the United States, where, after contractions of 6.3 percent and 3.4 percent in 2020, annual growth rates of 5 percent and 6 percent, respectively, returned in 2021. Such rapid economic expansion was also observed in major emerging markets, with China growing by 8 percent and India growing by 9.5 percent.

However, the pace of recovery slowed in the second half of the year. Higher inflation emerged as part of the recovery, exacerbated by persistent pandemic-induced bottlenecks in global supply chains. Domestic inflationary pressures, currency movements, and the prospect of further US monetary tightening have necessitated more significant monetary policy responses in some emerging markets, including Brazil, where interest rates have been raised by 500 basis points since August in an effort to stem the tide of capital outflows, which has pushed the economy into recession

The impact of the various global fiscal stimuli has meant that the mining industry is facing the consequences of global commodity cost inflation, which is causing supply chain disruptions, consumer inflation, and large variations in energy costs and capital costs.

Overall, a progressive recovery from Covid-19 has resulted in positive demand growth, with supply gradually adjusting to match this increasing demand. This has proven beneficial in practically all of the exploration and development assets Cadence has invested in, in particular lithium and iron ore. Which by the end of the year hadincreased by 485% and 47% respectively in price.

Iron Ore tracked economic progress and were affected by geopolitical shifts throughout the year. Global crude steel production is expected to have climbed by 4.3 percent in 2021, setting a new high. Europe and the Americas experienced the most rapid increase. In China, the world’s largest steel producer, output reached a new high in May before declining economic mood and a faltering real estate sector weighed on output. Iron ore prices reached a new high in May, fuelled by China’s robust growth earlier in the year, to which supply struggled to respond. Prices averaged $160/tonne for the entire year, the highest level since 2011.

The buoyancy of the lithium price has been driven by the market tightening as the electric vehicle revolution accelerates. Demand has eroded the oversupply seen in 2019 and 2020. This market tightness is projected to persist, with Credit Suisse predicting that lithium demand might triple by 2025 from current levels, and that supply would be stretched to meet that demand, with higher prices required to incentivise the necessary supply response

As a result of this substantial shift in consumer behaviour, demand for lithium is expected to climb by 30 percent to 675,000 tonnes LCE in 2023, up from 2021 levels. Global battery consumption is predicted to climb 14-fold by 2030, with Statista projecting 1.8 million tonnes of lithium demand by 2030.

Despite the strong market fundamentals, lithium production is expected to be 441,000 tonnes LCE in 2021, down from 464,000 tonnes in 2020. However, lithium output is predicted to increase at a 13.4 percent CAGR to 679,000 tonnes in 2023. According to Macquarie, the deficit this year will be 2,900 tonnes of LCE, rising to 20,200 tonnes in 2022 and 61,000 tonnes in 2023.

Our portfolio has been focused on two main investments, and the first is the private Amapa Iron Ore Project. The key outstanding item for Cadence to complete its initial US$2.5 million (20%) investment in the Amapa Project was the execution of a settlement agreement with the secured bank creditors. This was achieved at the end of the year, with Cadence vesting its 20% in February 2022 and subsequently increasing its stake to 27% in March 2022.

DEV Mineração S.A’s (“DEV”) the owner of the Amapa Project also began shipping of its 58% iron ore stockpiles during the years it shipped some 143,000 wet tonnes. The majority net proceeds of these sales is being paid to the secured bank creditors as part of the settlement agreement.

Operationally DEV progress has been solid, with DEV continuing to invest in the project with the priorities on the completion of a Pre-feasibility Study (‘PFS’) and the rehabilitation of the tailings dams at the Amapa Iron Ore Mine.

As we have mentioned on numerous occasions, the opportunity to invest in such a project is rare within our industry, and we believe this project provides us with a potentially transformative asset for our Company. The Amapa Project gives Cadence the potential for an exceptional return on investment in the run-up to full production and an opportunity to become a significant shareholder in a mid-tier iron ore producer.

The second of our key investments is European Metals Holdings (“EMH”), whose strategy is to become a Czech based lithium and tin producer. During the year, EMH’s Cinovec Project has been significantly de-risked and is moving rapidly towards a final investment decision.

The progress and performance of our investment portfolio was well reflected in our share price performance during the year, which increased from around 15 pence to 28 pence. This was clearly driven by the agreement reached with the Amapa Iron Project’s secured bank creditors at the end of 2021.

During the year, we saw prices of up to 31 pence, which was driven by an increase in iron ore prices that reached US$220 per tonne in August, but prices then fell to US$90 by November 2021, which was reflected in our share price, which reached 17 pence in October 2022. Cadence’s share price has increased by more than 314 percent over the last two years, representing significant growth.

However, 2022 has been a very different story, with inflationary pressures affecting the entire equity market (the SP 500 is down some 20 percent this year). Cadence’s share price performance in 2022 reflects the performance of our equity investments, such as European Metals Holdings and other higher risk assets. This is despite our portfolio continuing to make solid operational progress and being fundamentally the same investments that drove our share price increases in 2020 and 2021.

During 2022, our priorities on the Amapa Iron Ore Project will be the publication of a maiden Ore Reserve Estimate, followed by the release of a PFS on the project. We will also plan to increase our stake in the asset. In addition, we anticipate that our investment in Lithium Technologies and Lithium Supplies will have listed during 2022, and we are hoping to crystallise some additional value from our other privately held investments.

I would like to express my gratitude to the Cadence team and our investee companies, who have all worked tirelessly to bring the Company and its investment to their current position. We believe that concentrating risk across a few important investments and commodities will pay off.

Kiran Morzaria

Chief Executive Officer

INVESTMENT REVIEW

As outlined in the section “Our Business and Investment Strategy,” Cadence operates an investment strategy in which we invest in private projects via a private equity model and in public equity. In both investment classes, we take either an active or passive role. We have reported in these segments below.

PRIVATE INVESTMENTS, ACTIVE

The Amapa Iron Ore Project, Brazil
Interest – 20 % at 31/12/2022 increased to 27% by 31/05/2022

The Amapa Project is a large-scale iron open pit ore mine with associated rail, port and beneficiation facilities that commenced operations in December 2007. Production increased to 4.8 Mt and 6.1 Mt of iron ore concentrate product in 2011 and 2012, respectively. Before its sale in 2012, Anglo American valued its 70% stake in the Amapa Project at US$462m (100% US $660m).

In 2019 Cadence entered into a binding investment agreement to invest in and acquire up to 27% in the Amapa iron ore mine, beneficiation plant, railway and private port owned by DEV (“The Agreement”). The Agreement also gave Cadence a first right of refusal to increase its stake to 49%.

To acquire its 27% interest, Cadence will invest US$6 million over two stages in a joint venture company. The first stage is for 20% of the JV, the consideration for which is US$2.5 million. The second stage of investment is for a further 7% of JV for a consideration of US$3.5 million.

Vesting of Equity Interest in the Amapa Project

During the year, the key target for Cadence was to vest its first 20% in the Amapa Project. This required DEV and the investors (Cadence and Indo Sino via our joint venture company) to reach a settlement agreement (“Settlement Agreement”) with the secured bank creditors.

This was achieved on the 29 December 2021, when all the parties entered into a binding Settlement Agreement. The original credit facility provided to DEV by the secured creditors had a principle amount outstanding amount of US$135 million. The Settlement Agreement settles all of the principal amount plus all interest, default interest, outstanding costs and fees (“Settlement Amount”).

As a result of the Settlement Agreement and the Judicial Restructuring Plan approved in August 2019, the total principal amounts owed to the secured and unsecured creditors in classes I to IV of DEV have been reduced from approximately US$231 million to approximately US$103 million or approximately 45% of the original value.

The Settlement Amount will be paid over two years from the effective date of the Settlement Agreement, and it is to be satisfied by the net profits from the sale of DEV’s iron ore stockpiles. The unsecured creditors will be paid from DEV’s free cash flow over a period of nine years. Under the Settlement Agreement, DEV remains the obligor with the Secured Creditors having no recourse of repayment of the Settlement Amount to either Cadence or Indo Sino. The Settlement Agreement will remain secured over all of DEV’s equity and assets.

Although the Settlement Agreement was executed within the year, the required contractual and regulatory documentation was completed post year end and Cadence vested its 20% interest in February 2022 and its 27% in March 2022.

Iron Ore Shipments

During the year the Commercial Court of São Paulo (“the Court”) ruled that DEV could commence the shipment of the iron ore stockpiles situated at DEV’s wholly-owned port in Santana, Amapa, Brazil. DEV was initially to export sufficient iron ore to realise a US$10 million of iron ore (after the deductions of all logistical, regulatory, shipping and sale costs) from the Amapa stockpiles at the port.

By the end of May 2021 DEV had shipped three cargoes totalling approximately 143,500 wet tonnes of 58% sinter feed iron ore. After all costs these sales netted DEV circa US$8 million. In July 2022, the Court permitted the export a further US$10 million of iron ore (after the deductions of all logistical, regulatory, shipping and sale costs). However, with the 58% iron ore pricing decreasing some 40% from May to August 2021 and shipping pricing remaining strong during the period DEV determined that there was a substantial risk to profitably by continuing to ship while shipping prices remained at high levels (US$ 80 – US$90 per wet tonne)

Once the Settlement Agreement had been completed in February 2022, DEV has been free to ship from its stockpiles and is not restricted by the Court permissions outlined above. Subsequent to the year end DEV shipped a further 48,492 wet tonnes of 58% iron ore sinter fines, DEV expect to receive circa US$ 900k for this shipment. Shipping prices have continued to increase during 2022, driven by higher diesel prices and limited availability of vessels. This combined with iron price volatility has meant that DEV is currently not shipping form its stockpiles.

The vast majority of the net proceeds from the sales of the Iron Ore has been paid to the secured bank creditors as part of the Settlement Agreement. The remainder of the funds have been applied to DEV operations.

Operations Review

The operational focus for the year at the Amapa Project has been the start the rehabilitation process of the project. This has primarily focused on tailing dam maintenance. DEV has employed a civil engineer and two geotechnical consulting firms to advance the work programme, including monitoring, geotechnical stability testing and statutory reporting. The end goal is to ensure that the current dams will be suitable for future operations amid Brazil’s more stringent regulatory environment.

In addition, DEV also began early rehabilitation of light infrastructure, the regularising the statutory reporting with the federal mining authority and state environmental authorities.

The other important focus for DEV and Cadence was to start the PFS. This began in 2021 with DEV appointing several internationally accredited engineering and consulting firms to carry out the PFS. At the time of writing The PFS is progressing as expected, with the consulting engineers for the mine operations, ore reserve estimation, metallurgy, processing, infrastructure and shipping having submitted their draft reports.

The PFS contemplates refurbishing and rehabilitating the existing port, rail and plant with modifications being made to the beneficiation plant to achieve a larger portion of 65% iron concentrate (4.9 Mt). The PFS is based on producing 5.3 Mt of iron ore concentrate per annum.

The Amapa Project’s Current Development Plan

The PFS, once complete will outline more fully the development timelines, capital required to achieve the stated project aims. Subsequent to the publication of an economic PFS we expect the DEV will seek to commission a Definitive Study (“DFS”). The DFS is required to seek project debt and equity finance which will be sought once the DFS is complete.

Cadence and its joint venture partners are having early discussions with potential debt providers and corporate financiers, which we will advance once the PFS is complete. On completion of the DFS and securing debt and equity financing project construction will commence.

Lithium Technologies Pty Ltd & Lithium Suppliers Pty Ltd (“LT” & “LS”)
Interest – 31.5% at 31/12/2022 and 31/05/2022

In December 2017, Cadence Minerals announced that it had executed binding investment agreements to acquire up to 100% LT & LS, which was subsequently varied to acquire three prospective assets in Australia that are in regions with proven high-grade lithium mineralisation.

LT and LS, through their subsidiaries, are the holders of two prospective exploration licenses and one exploration application in Australia and a further seven exploration license applications in Argentina.

All of the licenses and applications target prospective hard rock lithium deposits. The most significant of these is the Litchfield lithium prospect, which is contiguous to Core Lithium’s (ASX: CXO) strategic Finniss Lithium Project (JORC compliant ore reserves: 7.4Mt @ 1.3% Li2O)2.

During the year we saw a renewed interest in hard rock lithium projects in Australia. As such we increased our investment to 31.5% into LT & LS which funded operations on the Litchfield exploration license.

Satellite imagery verified the geology along the Litchfield exploration license north-west boundary is comparable to Core Lithium Ground. LT & LS’s geological consultant conducted intensive surface sampling across four target areas within the NW quadrant, taking 657 samples to determine the potential for contiguous mineralisation. The sampled areas mostly comprised metamorphic rocks linked to the Burrell Creek formation – a host rock for the regional occurrences of pegmatites. The samples results were returned in 2022, these results confirmed LT & LS’s view that the areas adjacent to Core Lithium boundary are prospective for lithium pegmatites.

Subsequent to the year end Cadence and the remaining shareholders entered into a conditional sale of 100% of LT and LS. The consideration for LT and LS is up to A$ 21.05 million (£11.82 million). Cadence has 31.5% of LT and LS and would receive up to A$ 6.63 (£3.72 million). The Buyer is a public, unlisted company in Australia (“Buyer”).

The acquisition of LT and LS has several conditions precedent, including the completion of due diligence and the relevant regulatory approval. Assuming this is successful, the Buyer will acquire 100% of LT and LS through a mixture of cash and shares partially paid on completion of the sale of LT and LS and the remainder paid on the achievement of key performance milestones.

The Buyer has committed to spending at least A$4 million on the exploration of Litchfield during the three years post the completion of the sale. Should the milestones not be achieved during this period, the respective consideration will not be payable.

The proceeds received by the Company will be used for reinvestment as per our investment strategy. In relation to the shares received as part of the consideration, the Company will be bound by an escrow agreement with the Buyer as per the regulatory authorities in Australia and will be in the form and substance consistent with the ASX Listing Rules. After the lapse of the escrow arrangement, Cadence will retain or dispose of these shares as per our investment strategy.

PRIVATE INVESTMENTS, PASSIVE

Sonora Lithium Project, Mexico
Interest – 30% at 31/12/2021 and 31/05/2022

Cadence holds an interest in the Sonora Lithium Project via a 30% stake in the joint venture interests in each of Mexalit S.A. de CV (“Mexalit”) and Megalit S.A. de CV (“Megalit”).

Mexalit forms part of the Sonora Lithium Project. The Sonora Lithium Project consists of ten contiguous concessions covering 97,389 hectares. Two of the concessions (La Ventana, La Ventana 1) are owned as of the date 100% by subsidiaries of Gangfeng Lithium Co., Ltd (“Gangfeng”). El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 concessions are owned by Mexalit S.A. de C.V. (“Mexalit”), which is owned 70% by Gangfeng and 30% by Cadence.

The Sonora Project holds one of the world’s larger lithium resources and benefits from being both high grade and scalable. The polylithionite mineralisation is hosted within shallow dipping sequences, outcropping on the surface. A Mineral Resource estimate was prepared by SRK Consulting (UK) Limited (‘SRK’) in accordance with NI 43-101. The current lithium resources and reserves for the Sonora Lithium Project and the attributable amounts to Cadence are available on our website here: https://www.cadenceminerals.com/projects/sonora-lithium-project/.

A feasibility study report was published in January 2018, which confirmed the positive economics and favourable operating costs of a 35,000 tonnes per annum battery-grade lithium carbonate operation. Thefeasibility study report estimates a pre-tax project net present value of US$1.253 billion at an 8% discount rate and an Internal Rate of Return of 26.1%, and Life of Mine operating costs of US$3,910/t of lithium carbonate.It should be noted that under the published feasibility study, the concession owned by Mexalit will be mined starting in year 9 of the mine plan cease at the end of the mine life in year 19, and as such, assuming Cadence retains its position, any net realisable economic benefit to Cadence would only accrue at this time.

The full report can be found here: https://www.bacanoralithium.com/pdfs/Bacanora-FS-Technical-Report-25-01-2018.pdf

Summary of Activities

The most significant development for the Sonora Lithium project both during 2021 and 2022, was that Ganfeng completed the acquisition of the Sonora Lithium Project.

Although this does not directly affect the terms of our Joint Venture, having Gangfeng as a partner in the development of this project is highly encouraging , given that Gangfeng’s involvement in the development of the project to date and their extensive experience in the lithium market holding company is the world’s third-largest and China’s largest lithium compounds producer and the world’s largest lithium metals producer in terms of production capacity.

Whilst COVID-19 has impacted the progress on the Sonora Lithium Project, work to complete the front-end engineering design (“FEED”) has continued throughout the period. Ganfeng is currently appointing a Chinese Design Institute to complete the FEED with initial site layouts scheduled for Q2 2022. Ganfeng is continuing to work with its equipment suppliers and, along with the Company, is maintaining its previously advised project delivery schedule with first lithium production in H2 2024.

Rescue and removal of surface vegetation and topsoil in the area required for the construction of the lithium

processing plant have been completed. Plant site location survey, geotechnical, and hydrogeological works

have also been completed. Works to build the construction road and early work camp have commenced. Site works for bulk earthworks are expected to commence in late 2022.

On September 30, 2021, Mexican politicians from the MORENA party tabled a draught bill to reform Mexico’s energy sector, including statements that lithium would be included among the minerals considered strategic for the energy transition and that no new concessions for lithium exploitation by private companies could be granted. Subsequent to the year end the Mexican senate elevated lithium deposits to the category of “strategic minerals”, declaring the exploration, exploitation, and use of lithium to be the exclusive right of the state.

We are constantly examining possible legislative changes and Gangfeng is ensuring that the mineral concessions remain legitimate. It is our current view that the Decree passed by the senate only impacts licenses, concessions or contracts to be granted not already those already granted as is the case for the Sonora Lithium Project. Therefore, at this point we do not believe there is a material impact to our joint venture areas.

Yangibana Project, Australia
Interest – 30% at 31/12/2022 and 31/05/2022

The Yangibana Project is a significant Australian Rare Earths Project, containing substantial Neodymium and Praseodymium resources. The Project currently covers approximately 650 square kilometres. The Project is located in the Gascoyne region of Western Australia, some 250 kilometres northeast of Carnarvon.

Cadence holds interests in tenements covering some of the prospective Gifford Creek Ferrocarbonatite Complex. Through wholly-owned subsidiaries, Cadence holds:

· 30% interest in 3 Mining Leases, 6 Exploration Licences, and 2 General Purpose Leases;

· 3 Mining Licenses Include:M09/159,M09/161,M09/163;

· 6 Exploration Licenses Included: E09/1043, E09/1049, E09/1703, E09/1704, E09/1705, E09/1706;

· 2 General Purpose Leases: G09/11, G09/13.

The tenements in which Cadence holds a 30% interest are in joint-venture with Australian listed Hastings Technology Metals (“Hastings”), and Hastings carries all costs up to the decision to commission a bankable feasibility study.

A definitive feasibility study published in 2017, modelled two production scenarios the second of which had included within it 808,000 tonnes of plant feed from one of our joint venture areas (Yangibana) in year 6. This production target and additional production target from the definitive feasibility study indicates that 11% of the plant feed will come from our joint venture area[*].

The economic model contemplated by Hastings assumes Cadence through its subsidiary will participate in the and mining of the deposits held 70% by Hastings and 30% by Cadence. Assuming there is a development of the mine by the joint venture a new Mining Joint Venture Agreement will need to be agreed and put in place to replace the existing joint venture documentation and regulate the arrangements between the participants for the mine development. No costs or revenue ascribed to 30% interest in the deposits held by Cadence were reported in the financial modelling published by Hastings.

Although Hastings Technology Minerals has progressed the development of the Yangibana Rare Earth project, most of this has been in relation to its wholly owned assets, with the only a change being reassessment of our joint venture mineral resources and reserves occurring in July 2021. There was no material difference in the recalculation of our portion of the resource and reserves; an updated summary can be found on our website here:https://www.cadenceminerals.com/projects/yangibana-rare-earth-project-2/.

PUBLIC EQUITY

The public equity investment segment includes both active and passive investments as part of our trading portfolio. The trading portfolio consists of investments in listed mining entities that the board believes possess attractive underlying assets. The focus is to invest in mining companies that are significantly undervalued by the market and where there is substantial upside potential through exploration success and/or the development of mining projects for commercial production. Ultimately, the aim is to make capital gains in the short to medium term. Investments are considered individually based on various criteria and are typically traded on the TSX, ASX, AIM or LSE.

During the period, our public equity investments generated an unrealised profit of £0.57 million (2020: £10.24 million) and a realised gain of £0.59 million (2020: £0.07 million). The majority of these profits were derived from the sale of European Metals Holdings shares. The total unrealised gains on our equity portfolio as at the end of 31 December 2021 was £9.27 million.

As of 31 December 2021, our public equity stakes consisted of the following

Company	Business Summary	Year ended 31 Dec 2021 £,000	Year ended 31 Dec 2020 £,000	Cumulative Total Return Since Inception	Active / Passive
European Metals Holding Limited	Lithium mine development	11,287	13,426	461%	Active
Charger Metals NL	Lithium exploration	342	–	22%	Passive
Macarthur Minerals Limited	Iron Ore mine development	181	329	118%	Passive
Eagle Mountain Mining Limited	Copper exploration	122	–	-42%	Passive
Mont Royal Resources Limited	Gold and Copper exploration	35	–	-6%	Passive
Miscellaneous	Various	7	6	-86%	Passive
Total		11,974	13,761

PUBLIC EQUITY (ACTIVE)

European Metals Holdings Limited (“European Metals”)
Interest – 8.1% at 31/12/2021 and 31/05/2022

Cadence has held an investment in European Metals since June 2015. As of year-end, Cadence held 8.1% in European Metals.

European Metals owns 49% of Geomet s.r.o. with 51% owned by CEZ. CEZ is a significant energy group listed on various European Exchanges. Geomet s.r.o. owns 100% of Cinovec which hosts a globally significant hard-rock lithium deposit with a total Indicated Mineral Resource of 372.4Mt at 0.45% Li2O and 0.04% Sn and an Inferred Mineral Resource of 323.5Mt at 0.39% Li2O and 0.04% Sn containing a combined 7.22 million tonnes Lithium Carbonate Equivalent and 263kt of tin, as reported to ASX on 28 November 2017 (Further Increase in Indicated Resource at Cinovec South).

An initial Probable Ore Reserve of 34.5Mt at 0.65% Li2O and 0.09% Sn reported on 4 July 2017 (Cinovec Maiden Ore Reserve) has been declared to cover the first 20 years’ mining at an output of 22,500tpa of battery-grade lithium carbonate reported on 11 July 2018 (Cinovec Production Modelled to Increase to 22,500tpa of Lithium Carbonate).

This makes Cinovec the largest hard-rock lithium deposit in Europe, the fourth largest non-brine deposit in the world and a globally significant tin resource. In June 2019 EMH completed an updated Preliminary Feasibility Study, conducted by specialist independent consultants, which indicated a return post tax NPV of USD1.108B and a post-tax IRR of 28.8%. Subsequent to the year end, in January 2022 EMH updated the 2019 PFS, which indicated a post tax NPV of US$1.938Bn and a post-tax IRR of 36.3%.

The study confirmed that the Cinovec Project is a potential low operating cost producer of battery grade lithium hydroxide or battery grade lithium carbonate as markets demand. It confirmed the deposit is amenable to bulk underground mining. Metallurgical test-work has produced both battery grade lithium hydroxide and battery grade lithium carbonate in addition to high-grade tin concentrate.

The Definitive Feasibility Study continues, albeit with some minor delays related primarily to Covid-19 and the effect that has had on logistics globally. Whilst the project had no direct Covid-19 related issues at site, moving samples and our people has been problematic at times. We don’t anticipate any escalation in this.

Apart from these delays, we have made steady progress of the Cinovec Project with positive developments in the areas of our locked cycle testwork, permitting advancement and Measured Resource drilling programme.

The Project has been significantly de-risked and at the time of this report is moving rapidly towards a final investment decision.

The Project Company appointed SMS group, a German-based world-leading engineering firm, as the lead engineer for the minerals processing and lithium battery-grade chemicals production at Cinovec. This marks the beginning of the formal Front-End Engineering Design study as the major component of the ongoing Definitive Feasibility Study. This detailed engineering contract, along with advances in permitting and offtake discussions, moves us closer to the development of Europe’s largest hard rock lithium resource for the benefit of all stakeholders.

FINANCIAL REVIEW

Total comprehensive income for the year attributable to equity holders was a loss of £0.14m (2020: profit of £7.82m). This decrease in profitability from the previous year of approximately £7.96m is mainly due to the reduced amount of realised and unrealised profits and losses for the year of approximately £1.2m (2020: £10.4m) relating to our share investment portfolio (listed financial investments) held during the period. Administrative expenses were up £0.36m from £1.44m to £1.80m, but foreign exchange gains were up £1.28m from a loss £0.82m to a gain of £0.46m.

Basic negative earnings per share was 0.102p (2020: positive earnings per share of 6.897p).

The net assets of the Group at the end of the period were £22.15 million (2020: £22.09 million). This increase of approximately £0.06m reflects the losses and shares issued in the year.

Cadence Minerals #KDNC – Interim Results

26th August 2021 / Leave a comment

Cadence Minerals plc (AIM/NEX: KDNC) is pleased to announce its interim results for the six months ended 30 June 2021.

Highlights

The focus of the Company since the beginning of the year has been its investment into the Amapa Iron Ore Project (‘Amapa Project’). This investment continues to be our top priority which has involved finalising the settlement agreement with the secured bank creditors and the advancement of the pre-feasibility study on the asset. The delays in crystallising our investment are a result of the secured bank creditors’ internal bureaucratic process, which is required when settling a loan of this value and under the terms agreed. Nonetheless we have continued to move the Amapa Project forward which has included, amongst other things, the iron ore stockpile shipments commencing in March and the pre-feasibility studies starting soon after that.

We are also in the process of reviewing our privately held assets, in particular, our early-stage lithium prospects in north Australia. We believe that these could be of some strategic importance given their proximity to the Finniss Project, owned by ASX listed Core Lithium.

During the period our equity investments have performed very well, primarily driven by the performance of European Metals Holdings. Our equity investments generated a total income of £3.54 million resulting in profit before taxation of £2.84 million for the six months ended June 2021.

At a macro-economic level, the first half of 2021 saw the continued global recovery from the physical demand shock from COVID-19 experienced in 2020. According to the World Bank Group, the global economy is set to expand some 5.6% in 2021, its most robust post-recession pace in 80 years. However, this recovery is expected to be uneven and primarily reflects sharp rebounds in some major economies – most notably the United States – driven by substantial fiscal support. These ongoing monetary easing programmes have continued to support commodity prices and, in particular iron ore in the first half of this year. In addition, the accelerated transition and electrification of vehicles has increased lithium compound pricing, with the Benchmark Lithium Price Index up 85.3% on a year-to-date basis.

After the period end, we saw a softening of iron ore and other commodities (although lithium compound pricing remains strong). We believe this is primarily driven by China’s protectionist policies, including the possible imposition of steel quotas, crackdowns on speculative trading and the potential spread of the COVID-19 Delta variant. We expect the demand–supply balance to remain relatively tight for iron ore and lithium compounds in the medium term although there is still some residual uncertainty about how vaccine deployment and the policy and behavioural response to the newer, more infectious strains of COVID-19 will interact over the coming quarters.

As outlined in our annual report and accounts, Cadence operates an investment strategy that includes both investments in private projects via a private equity model and investments in public equity. In both investment classes, we take either an active or passive role. We have reported on each class below.

Private Investments (Active)

The Amapa Iron Ore Project, Brazil

The Amapa Project is a large-scale open-pit iron ore mine with associated rail, port and beneficiation facilities that commenced operations in December 2007. In 2019, Cadence entered into a binding investment agreement to invest in and acquire up to 27% of the Amapa iron ore mine, beneficiation plant, railway and private port owned by DEV Mineração S.A (‘DEV’) (‘The Agreement’). The Agreement also gave Cadence a first right of refusal to increase its stake to 49%.

To acquire its 27% interest, Cadence will invest US$6 million over two stages in a joint venture (‘JV’) company. The first stage is for 20% of the JV, the consideration for which is US$2.5 million. The second stage of investment is for a further 7% of the JV for a consideration of US$3.5 million. The investments are wholly contingent on DEV delivering several key preconditions. The funds for the first stage of investment are currently held in a judicial trust account of the commercial court of Sao Paulo.

All of our shareholders are aware that the remaining major precondition for Cadence to make its first stage investment in the Amapa Project requires DEV and the investors (Cadence and Indo Sino via our JV company) to reach a settlement agreement with the secured bank creditors. As of the date of the publication of these interims, the investors, DEV, and the secured bank creditors have agreed on the principal terms of the settlement agreement, which include the quantum, timing and all other material terms. The final settlement agreement is in near-final form, and the secured bank creditors have either had credit committee approval or are awaiting it.

We understand that this process has been frustrating, given that we agreed on the principal terms of the settlement in September 2020, but this matter has been outside of our control. The alternative to the current agreed (in principle) settlement would be hugely detrimental to the secured bank creditors, nonetheless. We have a high degree of confidence that we will execute a settlement agreement and will be announced as soon as it is completed.

As of the end of August 2021, DEV had shipped three cargoes totalling approximately 143,000 wet tonnes of 58% iron ore. DEV is also contracted to carry out logistical and shipping activities for third parties who have stockpiles held at DEV’s port, which it has been doing since it completed its third shipment in May of this year. These third-party stockpiles are separate from the 1.25 million tonnes of 58% iron ore (+/- 10%) owned by DEV. At this point, DEV intends to continue to carry out these shipping activities for these third parties. This is because current shipping rates have increased dramatically (US$80–90 per tonne), which is reducing the profitability of shipping DEV’s material. We believe that these rates should normalise over the medium term; therefore, the shipping of DEV’s material will recommence at a later stage.

The first portion of the net revenues has been used to pay historic small and employee creditors. Approximately US$6 million of the net revenues will be used to begin recommissioning studies on the Amapa Project and to start maintenance and monitoring of the current tailing dam facilities. The remaining net revenues will provide working capital for the operations and will be used as payment against the outstanding amount due to the secured bank creditors.

After the period end, DEV was permitted to export a further US$10 million (after the deductions of all logistical, regulatory, shipping and sales costs) of iron ore from its stockpiles situated at its port in Santana, Amapa, Brazil. This authority is in addition to the first permission granted to DEV on 10 February 2021, in which it was permitted to ship an initial US$10 million (net of costs) of iron ore.

Work on the started earlier in the year on the Pre-feasibility Study (‘PFS’). DEV has appointed internationally accredited engineering and consulting firms to carry out the engineering and conditioning study on the beneficiation and processing plant. These firms will also review the power supply options for the mine and plant, particularly the possibility of connecting to the grid network, enabling the mine and the plant to be predominantly powered by low-cost renewable energy. In addition, PFS work has started on the railway with the inspection of some 193km of rail and associated infrastructure. Both of these studies, once complete, will form part of the PFS. In the coming months, we expect DEV to appoint a consulting and engineering firm to start work on the port studies and conduct a geotechnical investigation of the mine.

As previously announced in May of this year, DEV began tailing dam maintenance. DEV has now employed a civil engineer and two geotechnical consulting firms to advance the work programme, including monitoring, geotechnical stability testing and statutory reporting. The end goal is to ensure that the current dams will be suitable for future operations amid Brazil’s more stringent regulatory environment.

In addition to the PFS work, DEV has worked with Companhia Docas de Santana (‘CDSA’) to increase loading capacity at the public port. Together with CDSA, DEV has established and tested a process at CDSA’s port in Santana for loading a 45,000-tonne vessel with iron ore at Pier Two from the berth side. This operation was the first of its kind and will allow shipment of the DEV stockpile at a faster rate if required.

Lithium Technologies Pty Ltd and Lithium Suppliers Pty Ltd (‘LT’ and ‘LS’)

Cadence owns 25.85% of LT and LS, which owns or has applied for three prospective hard rock lithium assets in Australia and six exploration applications in Argentina.

With the increase in lithium compound pricing, we have seen renewed interest in hard rock lithium projects in Australia. Our assets are prospective for pegmatites and especially our Litchfield exploration licence, which is adjacent to Core Lithium’s Finniss Project. A feasibility study was completed on the Finniss Project, which shows a pre-tax net present value of AU$384 million.

Given the progress being made at the Finniss Project, we will be reviewing the targeting and fieldwork studies carried out in 2019 to determine if it is worth pursuing further exploration in our joint venture areas.

Private Investments (Passive)

Our two passive private investments consist of our 30% equity stake in five lithium concessions that form part of the Sonora Lithium Project and our 30% interest in three mining leases, six exploration licences and two general-purpose licences that form part of the Yangibana Rare Earth Project. Our joint venture partners for these assets are Bacanora Lithium and Hastings Technology Metals, respectively. Further details on the Sonora Lithium and Yangibana Rare Earth Projects can be found here and here, respectively.

In May 2021, Bacanora Lithium and Ganfeng International Trading (Shanghai) Limited (‘Ganfeng’) entered into an agreement regarding the terms of a possible cash offer by Ganfeng for the entire issued share capital of Bacanora Lithium, other than that which it already owns, for 67.5 pence per Bacanora Lithium share (the ‘Possible Offer’). The preconditions to the Possible Offer are progressing, with the latest update provided here on 29 July 2021. The Possible Offer remains subject to certain other preconditions, including the Due Diligence Precondition. The satisfaction or waiver of the Due Diligence Precondition is at the sole discretion of Ganfeng’ s board.

As far as the Company is aware, the Possible Offer has no direct effect on our joint ventures. Should the cash offer be successful, it will be highly encouraging for the development of the project, given Ganfeng’s involvement in the development of the asset to date, their extensive experience in the lithium market and the fact that their holding company is the world’s third-largest (and China’s largest) lithium compounds producer.

Public Equity

During the period, our public equity investments generated an unrealised gain of £3.12 million and a realised gain of £0.42 million. The majority of these profits were derived from the sale of European Metals Holdings shares.

As of 30 June 2021, our public equity stakes consisted of the following:

Company	Listing	Value £’000	Type of Investment
European Metals Holdings Limited	(ASX & AIM: EMH) (NASDAQ: EMHXY)	14,180	Active
MacArthur Minerals Limited	(ASX: MIO) (TSX-V: MMS)	327	Passive
Celsius Resources	(ASX: CLA)	103	Passive
Eagle Mountain Mining Limited	(ASX: EM2)	153	Passive
Charger Metals NL	(ASX: CHR)	109	Passive
Miscellaneous	Various	6	Passive
Total		14,878

European Metals Holdings Limited (‘European Metals’)

Cadence has held an investment in European Metals since June 2015. As of the period end, Cadence held approximately 9.7% of the Cinovec deposit in the Czech Republic through a direct holding in the share capital of European Metals that owns 100% of the exploration rights to the Cinovec lithium/tin deposit.

Cinovec hosts a globally significant hard rock lithium deposit with a total Indicated Mineral Resource of 372.4Mt at 0.45% Li2O and 0.04% Sn, and an Inferred Mineral Resource of 323.5Mt at 0.39% Li2O and 0.04% Sn, containing a combined 7.18 million tonnes of lithium carbonate equivalent and 263kt of tin (as reported on 28 November 2017). An initial Probable Ore Reserve of 34.5Mt at 0.65% Li2O and 0.09% Sn (as reported on 4 July 2017) had been declared to cover the first 20 years of mining. A projected output of 22,500tpa of lithium carbonate was reported on 11 July 2018.

The project has been significantly de-risked and is moving towards a final investment decision. European Metals has continued to progress the development of the assets across all the critical areas of the project. This includes further resource drilling to upgrade areas into measured resources and the completion of the locked cycle testing, which further supports the project’s credentials to produce battery-grade lithium carbonate and convert it to lithium hydroxide.

Trading Portfolio Public Equity (Passive)

Cadence’s passive investments are typically direct purchases of listed mining equities but may include other investment structures. The aim is to make capital gains in the short to medium term. Investments are considered individually based on a variety of criteria. Investments are typically traded on the TSX, ASX, AIM or LSE. During the period, we invested in a broader range of publicly listed investments and retained our stake in MacArthur Minerals Limited. Our trading portfolio generated a realised gain of £0.02 million over the period. A summary of our holdings is detailed in the table above.

Given that none of our trading portfolio investments represent more than 10% of our net assets and are below the relevant reporting thresholds in the applicable jurisdiction, we have determined that going forward, we will not republish regulatory announcements associated with these investments unless, of course, they become material. We will report on the performance of the trading portfolio investments via our annual and interim financial statements.

Financial Results

During the period, the Company made a profit before taxation of £2.84 million (six months ended 30 June 2020: loss of £1.40 million, the year ended 31 December 2020: profit of £7.82 million). There was a weighted basic profit per share of 1.914p (six months ended 30 June 2020: loss of 1.521p, the year ended 31 December 2020: profit of 6.705p).

The total assets of the Company increased from £22.61 million as of 31 December 2020 to £25.37 million. Borrowings were reduced from £0.22 million at 31 December 2020 to zero at 30 June 2021.

During the period, our net cash outflow from operating activities was £1.15 million, and our net cash position increased by £0.78 million to £1.39 million.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information:

Cadence Minerals plc	+44 (0) 7879 584153
Andrew Suckling
Kiran Morzaria

WH Ireland Limited (NOMAD & Joint Broker)	+44 (0) 207 220 1666
James Joyce
Darshan Patel

Novum Securities Limited (Joint Broker)	+44 (0) 207 399 9400
Jon Belliss

CADENCE MINERALS PLC

STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 JUNE 2021

	Notes	Unaudited Period ended 30 June 2021	Unaudited Period ended 30 June 2020 (restated)	Audited Year ended 31 December 2020
		£’000	£’000	£’000

Income				–
Unrealised profit/(loss) on financial investments		3,116	(383)	10,252
Realised profit/(loss) on financial investments		423	(34)	65
Other income		–	–	54
		3,539	(417)	10,371

Share based payments		(197)	–	(57)
Other administrative expenses		(505)	(599)	(1,379)
Total administrative expenses		(702)	(599)	(1,436)

Operating profit/(loss)		2,837	(1,016)	8,935

Foreign exchange gains/(losses)		(21)	(181)	(820)
Finance income		29		6
Finance cost		(4)	(199)	(298)
Profit/(loss) before taxation		2,841	(1,396)	7,823

Taxation		–	–	–

Profit/(loss) attributable to the equity holders of the Company		2,841	(1,396)	7,823

Total comprehensive profit/(loss) for the Period, attributable to the equity holders of the Company		2,841	(1,396)	7,823

Loss per share
Basic (pence per share)	3	1.914	(1.521)	6.705
Diluted (pence per share)	3	1.814	n/a	6.609

CADENCE MINERALS PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2021

	Share capital	Share premium account	Share-based payment reserve	Retained earnings	Total equity
	£’000	£’000	£’000	£’000	£’000

Balance at 1 January 2020 (restated)	1,471	30,357	1,383	(22,225)	10,986
Transfer on lapse of warrants	–	–	(203)	203	–
Issue of share capital	238	1,471	–	–	1,709
Costs of share issue	–	(81)	–	–	(81)
Transactions with owners	238	1,390	(203)	203	1,628
Loss for the Period	–	–	–	(1,396)	(1,396)
Total comprehensive loss for the Period	–	–	–	(1,396)	(1,396)
Balance at 30 June 2020 (unaudited and restated)	1,709	31,747	1,180	(23,418)	11,218
Share based payments	–	–	57	–	57
Transfer on lapse of warrants	–	–	(1,166)	1,166	–
Transfer on exercise of warrants	–	–	(32)	32	–
Issue of share capital	187	1,522	–	–	1,709
Costs of share issue	–	(110)	–	–	(110)
Transactions with owners	187	1,412	(1,141)	1,198	1,656
Profit for the Period	–	–	–	9,219	9,219
Total comprehensive loss for the Period	–	–	–	9,219	9,219
Balance at 31 December 2020	1,896	33,159	39	(13,001)	22,093
Share based payments	–	–	197	–	197
Transfer on exercise of warrants	–	–	(9)	9	–
Issue of share capital	7	50	–	–	57
Costs of share issue	–	(1)	–	–	(1)
Transactions with owners	7	49	188	9	253
Profit for the Period	–	–	–	2,841	2,841
Total comprehensive loss for the Period	–	–	–	2,841	2,841
Balance at 30 June 2020 (unaudited)	1,903	33,208	227	(10,151)	25,187

CADENCE MINERALS PLC

STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2021

		Unaudited	Unaudited	Audited
		30 June 2021	30 June 2020 (restated)	31 December 2020

Assets	Notes	£’000	£’000	£’000

Non-current
Financial Assets		3,203	2,837	2,885
Investment in associate
		3,203	2,837	2,885
Current assets
Trade and other receivables		5,901	6,033	5,365
Financial Assets		14,878	4,222	13,761
Cash and cash equivalents		1,387	362	596
Total current assets		22,166	10,617	19,722

Total assets		25,369	13,454	22,607

EQUITY AND LIABILITIES
Current liabilities
Trade and other payables		182	158	295
Borrowings		–	2,078	219
Total current liabilities and total liabilities		182	2,236	514

Equity
Share capital	4	1,903	1,709	1,896
Share premium		33,208	31,747	33,159
Share based payment reserve		227	1,180	39
Retained earnings		(10,151)	(23,418)	(13,001)

Total equity and liabilities
to owners of the Company		25,187	11,218	22,093

Total equity and liabilities		25,369	13,454	22,607

CADENCE MINERALS PLC

CONSOLIDATED CASH FLOW STATEMENT

FOR THE PERIOD 30 JUNE 2021

	Unaudited Period ended	Unaudited Period ended	Audited Year ended
	30 June 2021	30 June 2020 (restated)	31 December 2020

	£’000	£’000	£’000
Cash flows from operating activities
Operating profit/(loss)	2,837	(1,016)	8,935
Net realised/unrealised (profit)/loss on financial investments	(3,539)	417	(10,317)
Equity settled share-based payments	197	–	57
(Increase)/decrease in trade and other receivables	(536)	111	32
(Decrease) in trade and other payables	(113)	(185)	(68)
Net cash outflow from operating activities	(1,154)	(673)	(1,361)

Taxation	–	–	–

Cash flows from investing activities
Payments for current financial investments	(473)	–	(50)
Receipts on sale of current investments	2,895	806	2,052
Payments for non-current financial investments	(318)	(624)	(645)

Net cash inflow from investing activities	2,104	182	1,357

Cash flows from financing activities
Proceeds from issue of share capital	57	1,295	2,723
Share issue costs	(1)	(81)	(191)
Net loan repayments	(219)	(643)	(2,120)
Finance cost	(3)	(199)	(292)
Net cash (outflow)/inflow from financing activities	(166)	372	120

Net increase/(decrease) in cash and cash equivalents	784	(119)	116
Foreign exchange movements on cash and cash equivalents	7	–	(1)
Cash and cash equivalents at beginning of Period	596	481	481
Cash and cash equivalents at end of Period	1,387	362	596

NOTES TO THE INTERIM REPORT

FOR THE PERIOD ENDED 30 JUNE 2021

1 BASIS OF PREPARATION

The interim financial statements have been prepared in accordance with applicable accounting standards and under the historical cost convention. The financial information set out in this interim report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The Group’s statutory financial statements for the year ended 31 December 2020 have been delivered to the Registrar of Companies. The auditor’s report on those financial statements was unqualified.

The principal accounting policies of the Group are consistent with those detailed in the 31 December 2020 financial statements, which are prepared in accordance with International Financial Reporting Standards as adopted by the European Union (adopted IFRSs).

PRIOR PERIOD RESTATEMENT

Cadence Minerals plc is an investment entity and its interests are held exclusively with a view to subsequent resale. Historically the Company adopted a consolidation policy which didn’t reflect the nature, purpose and cashflows of the entity. This policy has been amended and the periods prior to 31 December 2020 have been restated in recognition of the change in accounting policy in line with IAS 8.

All investments preciously wrongly classified have been reclassified as Financial Assets held at Fair Value through Profit and Loss (“FVPTL”). The prior year accounts have been restated as a result. Additionally, deposits have been reclassified from cash and cash equivalent to other debtors as it is not considered to be readily available. Full details of the restatement are included in the financial statements for the year ended 31 December 2020.

GOING CONCERN

The Directors have prepared cash flow forecasts for the Period ending 30 September 2022. The forecasts demonstrate that the Group has sufficient funds to allow it to continue in business for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the accounts have been prepared on a going concern basis.

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results.

2 SEGMENTAL REPORTING

The Company operates a single primary activity to invest in businesses so as to generate a return for the shareholders.

3 PROFIT PER SHARE

The calculation of the loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average number of shares in issue during the Period.

	Unaudited	Unaudited	Audited
	six months ended	six months ended	year ended
	30 June 2021	30 June 2020 (restated)	31 December 2020

	£’000	£’000	£’000

Profit/(loss) on ordinary activities after tax (£’000)	2,841	(1,396)	7,823

Weighted average number of shares for calculating basic profit/loss per share	148,420,359	91,777,913	116,675,272
Share options and warrants exercisable	8,198,405	n/a	1,698,405
Weighted average number of shares for calculating diluted profit per share	156,618,764	n/a	118,373,677

Basic profit/(loss) per share (pence)	1.914	(1.521)	6.705
Diluted profit per share (pence)	1.814	n/a	6.609

4 SHARE CAPITAL

	Unaudited	Unaudited	Audited
	30 June 2021	30 June 2020	31 December 2020
	£’000	£’000	£’000
Allotted, issued and fully paid
173,619,050 deferred shares of 0.24p (30 June and 31 December 2020: 173,619,050)	417	417	417
148,649,098 ordinary shares of 1p (30 June 2020 129,264,891, 31 December 2020: 147,949,098)	1,486	1,292	1,479
	1,903	1,709	1,896

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Cadence Minerals #KDNC – Annual Results for the year ended 31 December 2021

Cadence Minerals #KDNC – Interim Results

1 BASIS OF PREPARATION

2 SEGMENTAL REPORTING

3 PROFIT PER SHARE

4 SHARE CAPITAL

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