TORONTO, May 23, 2018 (GLOBE NEWSWIRE) -- Galantas Gold Corporation (the "Company" or “Galantas”) (TSXV:GAL)
(AIM:GAL) is pleased to announce its financial results for the Quarter ended March 31, 2018.
Financial Highlights
Highlights of the first quarter 2018 results, which are expressed in Canadian Dollars, are summarized below:
| |
|
|
|
Quarter Ended March 31 |
|
All in CDN$ |
|
2018 |
|
|
2017 |
|
|
Revenue |
$ |
0 |
|
$ |
2,734 |
|
|
Cost of Sales |
$ |
(24,066 |
) |
$ |
(63,416 |
) |
|
Loss before the items below |
$ |
(24,066 |
) |
$ |
(60,682 |
) |
|
Amortization |
$ |
(64,249 |
) |
$ |
(40,055 |
) |
|
General administrative expenses |
$ |
(408,890 |
) |
$ |
(502,116 |
) |
|
Unrealized (loss) / gain on fair value of derivative financial liability |
$ |
10,000 |
|
$ |
(22,000 |
) |
|
Foreign exchange (loss) / gain |
$ |
(37,293 |
) |
$ |
( 59,381 |
) |
|
Net (Loss) for the quarter |
$ |
(524,498 |
) |
$ |
(684,234 |
) |
|
Working Capital (Deficit) |
$ |
(5,123,420 |
) |
$ |
(1,395,866 |
) |
|
Cash (loss) generated from operations before changes in non-cash working capital |
$ |
(332,420 |
) |
$ |
(394,599 |
) |
|
Cash at March 31, 2018 |
$ |
182,513 |
|
$ |
2,310,653 |
|
| |
|
|
|
|
|
|
The Net Loss for the quarter ended March 31, 2018 amounted to CDN$ 524,498 (2017: CDN$ 684,234) and the cash
outflow from operating activities before changes in non-cash working capital items for the quarter ended March 31, 2018 amounted to
CDN$ 332,420 (2017: CDN$ 394,599).
There were no financing activities during the first quarter. Additional loan advances from G&F Phelps Ltd, a
related party, during the quarter totalled $ 399,074 (UK£ 220,410). Subsequent to March 31, 2018 Galantas announced that its
operating subsidiary, Flintridge Resources Ltd. had signed a concentrate pre-payment agreement and a loan facility agreement for
US$ 1.6 million (CDN$ 2.012 million) with Ocean Partners UK Ltd., together with an increased, on-demand loan facility of £600,000
with G&F Phelps Ltd. (See press release dated April 12, 2018 for further details).
Permitting
In November 2017, Galantas reported that it had received notice of an application, by a third party, to the Court of
Appeal, in relation to a positive judicial review judgment regarding the grant of planning permission. This was subsequently heard
in February 2018. The Court will deliver its judgement at a later date, currently unknown.
Production/Mine Development
Production of flotation concentrate at the Omagh mine from development ore is expected to restart early in the third
quarter of 2018. The granting of planning consent in 2015 for an underground operation at the Omagh site, now subject to a judicial
review appeal result, permits the continuation and expansion of gold mining underground, following the exhaustion of accessible
resources available to the previous open pit operation. The underground mine, which is now in active development, will utilize the
same processing methods and will be the first underground gold mine, of any scale, in Ireland. The strategy is to establish the
underground mine and look for further expansion of gold resources on the property, which has many undrilled targets.
The phased development arrangement, in terms of mine access dimensions, is expected to allow for rapid expansion
of production as additional capital becomes available. The mill has now been re-commissioned in anticipation of a restarting of
concentrate shipments.
Underground development of a decline tunnel, located at the base of the existing open pit, started in the first
quarter 2017. After over-coming initial difficulties, tunnelling continued through 2017, the first quarter 2018 and to date. A
detailed plan is being implemented to accelerate progress in line with the planning consent. The development of the first
underground ore drive, which lies beneath a safety (crown) pillar against the Kearney open pit above, was projected,
20th April 2018, as approximately 90 metres away. This was expected to be reached at the end of June but the current
progress suggests this may be reached earlier in June, with processing of development ore recommencing early in the third quarter
of 2018. Underground development, using drill and blast techniques, is being carried out by an in-house crew which is fully trained
in safety and operating procedures. An in-house, mines rescue team has also been trained and equipped.
The present drilling and loading equipment, which was purchased for training and early tunnel development
purposes, is performing above expectations but has lower productivity than is expected with current technology. New drilling
equipment is being acquired on a rental basis, with options to purchase, and is expected to improve advance rates by over 40%. The
supplier of the equipment has advised of delays in production of the new equipment but has recently commissioned a substitute used
tunnelling drill rig on loan. Whilst the interim unit is not expected to be as efficient compared to the new rig, this has led to a
significant improvement in advance rate. Infrastructure improvements were required to support the rig which were implemented during
the first quarter of 2018. Additional personnel have been added to the workforce, which now total 27 on the Omagh site.
Safety and environmental matters remains a high priority for Galantas. The Company is pleased to report zero
lost time accidents for the quarter and routine water and other environmental monitoring continues to be compliant.
Roland Phelps, President and CEO of Galantas Gold Corporation, commented, “I look forward to seeing the improved
advanced rate continue. The anticipated start of operations at the flotation plant in coming months marks a milestone in
underground operations. We continue to invest in improved equipment and training of personnel and expect to accelerate this as cash
is generated from operations.”
The detailed results and Management Discussion and Analysis (MD&A) are available on www.sedar.com and www.galantas.com and the highlights in this release should be read in conjunction with the
detailed results and MD&A. The MD&A provides an analysis of comparisons with previous periods, trends affecting the
business and risk factors.
The Annual General and Special Meeting of the Company will be held at Thursday, June 28, 2018 at 11:00 a.m. (Toronto time) at
the registered office of the Company, DSA Corporate Services Inc. 82 Richmond Street East, Toronto, Ontario, M5C 1P1.
Qualified Person
The financial components of this disclosure has been reviewed by Leo O’ Shaughnessy (Chief Financial Officer) and the
production, exploration and permitting components by Roland Phelps (President & CEO), qualified persons under the meaning of NI.
43-101. The information is based upon local production and financial data prepared under their supervision.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements within
the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws,
including anticipated production and development projections, for the Omagh Gold project. Forward-looking statements are based on
estimates and assumptions made by Galantas in light of its experience and perception of historical trends, current conditions and
expected future developments, as well as other factors that Galantas believes are appropriate in the circumstances. Many factors
could cause Galantas’ actual results, the performance or achievements to differ materially from those expressed or implied by
the forward looking statements or strategy, including: gold price volatility; discrepancies between actual and estimated
production, actual and estimated metallurgical recoveries and throughputs; mining operational risk, geological
uncertainties; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign
involvement; speculative nature of gold exploration; dilution; competition; loss of or availability of key employees; additional
funding requirements; uncertainties regarding planning and other permitting issues; and defective title to mineral claims or
property. These factors and others that could affect Galantas’s forward-looking statements are discussed in greater detail in the
section entitled “Risk Factors” in Galantas’ Management Discussion & Analysis of the financial statements of Galantas and elsewhere
in documents filed from time to time with the Canadian provincial securities regulators and other regulatory authorities. These
factors should be considered carefully, and persons reviewing this press release should not place undue reliance on forward-looking
statements. Galantas has no intention and undertakes no obligation to update or revise any forward-looking statements in this press
release, except as required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of
the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Enquiries
Galantas Gold Corporation
Jack Gunter P.Eng – Chairman
Roland Phelps C.Eng – President & CEO
Email: info@galantas.com
Website: www.galantas.com
Telephone: +44 (0) 2882 241100
Grant Thornton UK LLP (Nomad)
Philip Secrett, Richard
Tonthat.
Telephone: +44(0)20 7383 5100
Whitman Howard Ltd (Broker & Corporate Adviser)
Ranald McGregor-Smith, Nick Lovering
Telephone: +44(0)20 7659 1234
