Friday, 31 March 2023

Caracal Gold PLC 

Caracal Gold PLC ("the Company"), the expanding East African gold producer with over 1,300,000oz of JORC compliant gold resources, is pleased to announce its unaudited interim results for the six months ended 31 Dec 2022 ("the period"). These results can also be found on the Company's website.

Summary operational and financial updates for the period

·    Sales of £2.380 million (Dec 2021 FY: £4.433 million) were generated from 1,641 ounces ("oz") of gold sold during the period at an average price of US$1,676/oz (Dec 2021 FY: 3,223oz sold at an average price of US$1,770/oz)

·    Gross Loss of £0.926 million for the period (Dec 2021 FY: gross loss of £1.197 million)

·    Loss before taxation of £3.713 million for the period (Dec 2021 FY loss of: £8.412 million)

·    Net debt of £6.436 million (Jun 2022: net debt of £3.784 million)

·    Ongoing work to increase production at the flagship Kilimapesa Gold Mine:

Ø Continue to optimize mine plan and renewed focus on process efficiencies.

Ø Realised a total 806 ounces in gold sales in Q3 and 835 ounces in Q4.

·    Reviewed the exploration programmes to further strengthen the current Mineral Resource Estimate ('MRE'):

Ø To date, 104 RC holes accounting for 10,444m and 21 DD holes accounting for 3,660m have been drilled at Kilimapesa Hill, Maghor and Vim Rutha.

Ø In Q4, seven trenches were completed for a meterage total of 420m, five at Kilimapesa West Hill and two in Vim Rutha.

·  Due to the delay in funding, activities around the expansion, operations have slowed down pending securing of funds.

·  Excellent progress at Nyakafuru Gold Project in Tanzania:

Ø Completed Phase 1 exploration project on time; and

Ø Commencing 2nd phase drill programme validating historical drill results (i) as well as further interpretation (ii) and collection of metallurgical samples (iii).

Finance update

Post the H1 2022 period the Company announced on the 10th January 2023, that the previously planned OCIM financing of US$10m would not be proceeding.  As a result, the previously announced Philoro funding was put on hold and it has now been necessary to renegotiate the terms of the US$1.5m Mill End Financing and to date this negotiation is ongoing.

The company is progressing discussions, including technical and legal due diligence, with several potential financiers in order to provide the funding required to complete the Kilimapesa expansion project. Philoro have confirmed their US$3m funding is planned to come in alongside this funding.

Also, post H1 2022 the company announced a US$1 million fund raise via the issue of secured Convertible Loan Notes ("CLNs") to Orca Capital GmbH ('ORCA'). The proceeds were immediately drawn down and used to accelerate operations at Kilimapesa. The Company has granted ORCA an option to subscribe for up to a further US$4 million of CLNs. (The details of the transaction are contained in the RNS dated 16th February 2023.)

Share Admissions and Prospectus update

Certain share admissions previously announced by the Company have not been admitted to the Financial Conduct Authority's ("FCA") Official List and to trading on the London Stock Exchange.  Work is continuing on the production of a prospectus, which will be published as soon as practicable, subject to approval by the FCA.

Board changes

During the period Mr. Riaan Lombard was appointed to the Board of Caracal Gold Plc ("Caracal") as an Executive Director and Chief Operating Officer ("COO").

Mr. Stefan Mülller was also appointed as a Non-Executive Director and as part of the Board changes, the Company announced that Mr. Gerard Kisbey-Green, current Executive Director, would transition to become a Non-Executive Director.

Post H1 2022

On the 13th January Mr Simon Games--Thomas stepped down from his position as Non-Executive Chairman. Simon Grant Rennick was asked to assist the Company in a consultancy role with the intention that he subsequently be appointed and that in the interim be regarded as Chairman Designate.

Corporate Governance review

Post the H1 2022 period the Company announced that legal counsel had been engaged to conduct a comprehensive review of the corporate governance, regulatory compliance and communications policies in order to strengthen internal procedures.

The Board decided that the Company's financial advisor, VSA, as well as an independent firm of solicitors, would be consulted to assist the Chairman Designate in this review and the Board expects the above to be concluded as soon as is practically possible.

KENYA - KILIMAPESA GOLD PROJECT

·  In Q3, the plant processed a total of 23,790t at an average grade of 1.61g/t through the CIL circuit and a further 29,919t at an average grade of 0.99g/t through the heap leach circuit to realise a total of 806 ounces in gold sales.

·  In Q4, the plant processed a total of 19,613t at an average grade of 1.80g/t through the CIL circuit and a further 6,859t at an average grade of 0.86g/t through the heap leach circuit to realise a total of 835 ounces in gold sales.

·  Plant 2 was stopped on 1 August 2022 as the project of washing fines in the circuit proved to be uneconomic. Major factors were the low tons washed to the CIL and the insignificant upgrading of the fines.

·  The heap leach pads reached design capacity and therefore Plant 3 was stopped in December 2022.

·  Gold figures accountability (ratio of sold to produced) increased to 99% in September from an average of 50% for July and August. This was attributed to the installations of weightometers in the plant and the flowmeter in the Plant 3 CIS circuit, standardisation of sampling and sample handling procedures and the increase in Quality Control checks in the new laboratory. Gold figure accountability has subsequently remained stable at these rates.

·  Tailings Storage Facility construction is on track.

Post H12022

Operating activities recommenced at Kilimapesa, activities on the heap leach plant commenced immediately with the pads being loaded from existing low-grade stockpiles. This was followed by open cast mining recommencing on the 5^th March and the Milling plant on the 8^th March. The Company then announced the discovery of a high-grade mineable zone above the current underground workings and previous drilled areas, which is now processing 360tpd of high-grade material with average grades from 3.31g/t to 4.74g/t. A targeted mining plan confirming 180 days of high-grade material has been prepared and is being actioned, while it is planned to focus on processing 500tpd.

Exploration

·  Latest results from drilling on Kilimapesa Hill confirmed the lateral and depth extensions at the Kilimapesa Hill.

·  Completed a total of 10 DD holes and 22 RC holes on Vim Rutha prospect, which extends more than 4km into the exploration licence and is located a few hundred metres south of Kilimapesa Hill, for a total of 1,621m and 1,943m respectively.

·  DD drilling confirmed the existence of a mineralised structure over 1.5km parallel to the Kilimapesa Hill deposit while samples from the RC drilling are currently being analysed.

·  A systematic trenching campaign commenced in Q3 to define the surface expression of the Vim Rutha mineralisation and samples are being analysed.

·  During Q4, a total of seven trenches were completed for a meterage of 420m. Five trenches at the Kilimapesa West Hill prospect and two in Vim Rutha prospect. These trenches were positioned to determine both the strike and the extent of mineralisation on Kilimapesa West Hill and Vim Rutha prospects.

·  Continued underground DD with a total of 33.32m being drilled in two boreholes in Adit D.

·  To date, 104 RC holes accounting for 10,444m and 21 DD holes accounting for 3,660m have been drilled at Kilimapesa Hill, Maghor and Vim Rutha:

Ø We also have assayed results from the Diamond Drilling ('DD') programme on the Vim Rutha prospect, a shear zone of about 4.9km parallel to the known orebody at the Kilimapesa Hill deposit ('Kilimapesa Hill') at the Kilimapesa Gold and Mining Operations in Kenya (the 'Project'). The drilling intercepted, on several occasions and over a distance of more than 2km from west to east, one or more mineralised structures of significant thickness located a few hundred metres south of Kilimapesa Hill.

Ø Assay results confirm that the Vim Rutha prospect corridor is intensely gold-bearing with mineralised intercepts indicated by historical diamond drilling. Additionally we have noted vertical and lateral extensions of one or more parallel mineralised structures over several kilometres of distance just south of Kilimapesa Hill.

Ø These results continue to demonstrate the high gold potential of the various exploration prospects located in direct proximity to the Kilimapesa Hill deposit.

Updated Company Reserves and Resources

·  Following the successful resource expansion drill campaign, we have expanded our Measured, Indicated and Inferred Resource of 12.15Mt @ 1.5g/t gold for 565.7koz contained gold for the Kilimapesa Hill Deposit.

·  This represents a 202% increase in the Measured and Indicated category, with 56% of the contained ounces (317.6koz) now in Measured and Indicated (previously 105koz).

·  These promising results support at least a 10-year Life of Mine for the current Project expansion, targeting 24,000oz per annum production.

·  The significant increase in the Measured and Indicated Resource provides optionality for the current mining and processing operations, delivering the necessary differential in feed grade to the Milling and Heap Leach plants.

Safety, Health, and Environment

·  Continued focus on environmental plans with targets hit, annual audit conducted, and environmental licence obtained in relation to exploratory drilling, open-pit mining, and heap leach.

·  Open Pit and Exploration Environmental Impact Assessment submitted to NEMA in Q4.

·  All statutory audits including Fire Safety, OH&S and Environmental up to date as at 31 December 2022.

·  Ongoing support of employees with various training programmes completed and underway.

·  One significant accident in Q3 - the employee received immediate care, is fully recuperated and has resumed work.

TANZANIA - NYAKAFURU GOLD PROJECT

·  Completed the Phase 1 exploration project on schedule with the final report nearing completion.

·  Completed several fieldwork programmes including structural analysis of Voyager and Mentelle and planning of location of drill holes for the 2nd phase drill programme.

·  Upgraded the Nyakafuru camp and completed the review of the licences and extensions.

·  Advanced the drill tender process. 

 * * ENDS * * 

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

CARACAL GOLD PLC

INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CARACAL GOLD PLC

INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION