Mining investment company Mantengu Mining has been fully reinstated on the JSE, its acquisition of Langpan has been completed, the group is fully funded and it has successfully commissioned the chrome plant.
The company’s board is, therefore, confident that the group and company will have sufficient resources to operate as a going concern, it notes in its results statement for the financial year ended February 28.
On July 27, 2022, Mantengu acquired 100% of the issued share capital of Langpan Mining, obtaining control.
Langpan mines and processes chrome ore to produce chrome concentrate, with platinum group metals (PGMs) as a by-product.
Mantengu is a resource investment company which is focused on unlocking new value in the mining, mining services and energy sectors.
During the year, the group incurred significant regulatory, legal and compliance costs with respect to its listing reinstatement and in completing the acquisition of Langpan.
At period-end, the group had accumulated losses of R20.5-million but the group’s total assets of R252.5-million exceeded its liabilities of R173.8-million. For the period, the company recorded a net loss after tax of R5.8-million and the company’s total assets of R551.3-million exceeded its liabilities of R22.3-million.
Having recently commissioned the Langpan chrome processing plant, the group says it is well positioned to drive growth and deliver a return to shareholders through its chrome beneficiation operations.
Mantengu is currently canvassing the market to identify suitable investment opportunities to support its strategy of investing in mining, mining services and energy investments.
The board says the group and company have access to adequate funding and facilities to meet foreseeable cash requirements and they are able to continue as a going concern.
On April 14, 2022, the group entered into a contract with RWE Supply and Trading to deliver 240 000 metric tonnes of chrome concentrate over a period of two years.
The amount bears interest at the secured overnight financing rate plus 5% and is repayable over the duration of two years beginning July 31.
The loan with the Industrial Development Corporation (IDC) of South Africa is secured by the assets that formed part of the agreement. Legal title to these assets remains with the IDC until paid off by Langpan.
The loan bears interest at prime plus 2.8%. The loan is repayable in monthly instalments over the five-year period which began late in calendar 2022.
A competent person's report (CPR) was performed by Bara Consulting. The total reserves indicated in the CPR are 2.17-million tonnes and the value indicated was R851-million.
The group was unable to record the mineral reserve at the fair value of R851-million on acquisition. This is because the mineral reserve had to be recorded at the pre-combination value of R94.9-million because of the Langpan acquisition being classified as a reverse takeover.
The group does not consider the value of the mineral reserve recorded in the statement of financial position of R94.9-million to be indicative of the value of the 2.17-million tonnes of ore at Langpan. The fair value is R851-million, it says.
The mineral reserve will be amortised on a units of production basis over the useful life of the mine.
POST-PERIOD
Following the resignation of Mahlatsi Movundlela as CEO on February 28, Michael Miller was appointed as the company’s CEO and Magen Naidoo was appointed as the CFO (replacing Michael Miller as financial director) respectively with effect from March 2.
On May 30, Mantengu released an announcement outlining the commissioning of the first Langpan chrome beneficiation plant.
The successful commissioning of the chrome plant has enhanced the production capacity of the plant to a throughput of 36 000 t a month or 100 t/h.
The chrome plant is expected to produce about 18 000 t a month of chrome concentrate, with a chrome content of between 42% and 44%.
No dividend was declared for the year ended February 28.