AEX Gold Inc. Reports Second Quarter Financial Results, Operational Update and Board Changes

TORONTO, ON / ACCESSWIRE / August 27, 2021 / AEX Gold Inc. (AIM:AEXG)(TSXV:AEX), an independent gold Corporation with a portfolio of exploration licences in Greenland, announces its unaudited condensed interim consolidated financial statements (“Financial Statements”) for the quarter ended June 30, 2021. All figures are in Canadian dollars unless otherwise noted.

The Financial Statements and the accompanying Management Discussion and Analysis are available on the Corporation’s website at www.aexgold.com and will be filed under the Corporation’s SEDAR profile at www.sedar.com later today.

As previously communicated, the Nalunaq Project was put on hold in February 2021 due to unforeseen cost increases associated with the impacts of the COVID-19 global pandemic and as per the April 2021 announcement, the Corporation was focussing on four elements to continue advancing and de-risking the Nalunaq Project:

• Conducting a third-party engineering study to optimize the Project costs and de-risk the Project schedule that will enable AEX to re-assess the execution methodology (self-execution vs. EPC) post completion;
• Conducting fully funded ‘early works’ infrastructure and a 20,000-30,000m exploration program to expand the Nalunaq Resource;
• Continue to advance the EIA and SIA to obtain all permits;
• Regional exploration targeting both gold and Green/Strategic minerals through technical research, sampling and geophysical surveys.

Corporate and Operational Update

• The Corporation completed a tender process for the third-party engineering study and have appointed Halyard Inc. (‘Halyard’) a boutique engineering consulting firm based out of Toronto, Canada. Halyard was involved in the engineering and design of most of the components in the Nalunaq processing plant and comes with Greenlandic, project execution experience. The engineering study on the process plant and associated infrastructure are progressing according to plan and we still expect completion by Q4 2021. The study will advance engineering and significantly de-risk project cost and schedule.
• Legacy procurement and contracting commitments have been reviewed and orders that were placed for the Process Plant and Site Mobile fleet prior to the February 2021 announcement are ready for delivery, and a strategy for logistics/storage is being considered.
• The third-party review of the Nalunaq Resource Model by InnovExplo, a specialist in a wide range of exploration and technical services in the metals and mining industry, has been completed and has concluded that the existing resource model contains no fatal flaws. The results of the review and recommendations formed the framework of the 2021 exploration program at Nalunaq. The drilling program will also leverage the latest findings from the drilling campaigns of 2019 and 2020 to test the down-dip extension of Main Vein in the Kirkspir Valley, nearby the South and Valley Blocks. The drilling campaign has got off to a slow start given the influence of COVID-19 and the high demand placed on drilling contractors which has been caused by high Commodity prices. Negotiations are currently underway with additional international drilling companies to support our exploration efforts this year, which will extend to our 2022 campaign.
• A condition assessment of the Bulkhead will be conducted in October 2021 to confirm the design parameters and the quality of construction after which a remediation plan will be developed. The assessment will include non-destructive pile integrity and ultrasound tests to determine the Bulkhead thickness as well as an unconfined compressive strength test of cored concrete samples.
• In June 2021, site preparation for the 50-person exploration camp commenced. Construction of the camp is progressing according to plan with estimated completion by September 2021. The camp will support continuing exploration activities at Nalunaq as the weather conditions turn towards winter in the coming months. Following the camp construction, the bridge crossing the Kirkespir River will be upgraded to provide reliable access between the exploration camp and historical mine site.
• The Environmental Impact Assessment (“EIA”) and Social Impact Assessment (“SIA”) are being advanced with no material update at this stage.
• In parallel to the exploration being conducted at Nalunaq, regional exploration is predominately focused on the Vagar and Nanoq gold targets as well as other evolving targets in licences around Nalunaq. Furthermore, we are exploring for copper/base metals and rare earth elements (“REE”) in the Sava licence, platinum group elements (“PGEs”) in the Sagga dyke, graphite at Norrearm and base metals across the Tartoq licences.

Strengthening of the Board

The Corporation is pleased to announce the further strengthening of its Board of Directors with the appointment of two additional Non-Executive Directors, Liane Kelly and Warwick Morley-Jepson.

Liane brings a wealth of ESG experience to the Board having enjoyed a successful career focused on advising companies on sustainability and CSR initiatives. She currently sits on the Board of B2Gold Corporation and acts as a CSR Advisor to Middle Ground Consulting. Liane specialises in advising companies on community engagement and social impact, both of which will be vital for AEX as the Corporation continues to build on its strong engagement with its Greenlandic stakeholders. Liane replaces George Fowlie, who steps down from the Board, but will continue to provide his invaluable expertise in corporate and business development to the Corporation as well as supporting our Investor Relations in Canada.

Warwick has significant experience in mining having spent just under 40 years’ in the industry, holding various managerial and executive positions including his current roles as Chairman and Independent Director of Wesdome Gold Mines and Karora Minerals respectively. Warwick was previously the Executive Vice President and Chief Operating Officer at Ivanhoe Mines and before that held the same positions at Kinross Gold Corporation. His experience in mine development and operations at global mining firms is highly relevant to AEX as the Corporation continues to progress both the Nalunaq mine and its various exploration targets.

Q2 2021 Financial Highlights

• The Corporation had a strong cash balance of $49.6 million at June 30, 2021 ($61.9 million at December 31, 2020), with no debt, and total working capital of $48.5 million ($61.4 million at December 31, 2020).
• Capital asset purchase commitments, net of deposits on order as at June 30, 2021 was $6.0 million. These commitments, as previously reported, relate predominantly to the purchase of components of the process plant and surface mobile vehicles. Available liquidity, net of commitments as at June 30, 2021 was $43.6 million.
• Construction in progress increased by $2.1 million in H1 2021 (zero at December 31, 2020), as a result of capitalized engineering costs on the Nalunaq Project prior to suspension on February 10, 2021.
• Exploration and evaluation expenses during the quarter was $2.0 million (Q2 2020: $0.9 million), predominantly on the Nalunaq Property.
• General and administrative expenses during the period were $2.1 million (Q2 2020: $0.5 million), the result of increased headcount, consulting and professional fees associated with right-sizing the organizational structure to develop Nalunaq.

Selected Financial Information

The following selected financial data is extracted from the Financial Statements for the three and six months ended June 30, 2021.

Financial Results

Financial Position

Eldur Olafsson, CEO of AEX, commented:

“I am pleased to report a strong set of results, with the Company currently well capitalised and advancing on all our key workstreams. In addition to the considerable progress made in the de-risking and development of the Nalunaq project, we are very excited to report on the wider scale exploration efforts that are ongoing alongside the work on our gold targets, targeting green and strategic minerals.

We believe that the current efforts to expand the Nalunaq resource, in addition to the focus on our exploration portfolio presents a unique opportunity to investors and we look forward to updating the market in due course.

I would also like to welcome Liane and Warwick onto the AEX Board. On behalf of the Corporation, we look forward to leveraging their experience as we continue to execute our development strategy.

Warwick’s experience across the mining value chain will be essential as the Corporation advances the engineering study and evaluates the Nalunaq Project execution methodology in the near future.

Liane’s appointment together with the promotion of Joan Plant to Vice President – Environmental, Social & Governance is a strong recognition of AEX’s commitment to being a responsible corporate citizen of Greenland. I would also like to thank George for the incredible work he has done throughout the years as a Board member and I look forward to continuing working with him as AEX develops”

AIM Rule Disclosures

In relation to the appointment to the board, there is no further information required to be disclosed pursuant to paragraph (g) of Schedule 2 of the AIM Rules for Companies save what is disclosed below.

Liane Catherine Kelly, aged 57, has held the following directorships and/or partnerships in the past five years:

Warwick Peter Morley-Jepson, aged 63, has held the following directorships and/or partnerships in the past five years:

Enquiries:

AEX Gold Inc.
Eldur Olafsson, Executive Director and CEO
+354 665 2003
[email protected]

Eddie Wyvill, Investor Relations
+44 (0)7713 126727
[email protected]

Stifel Nicolaus Europe Limited (Nominated Adviser and Broker)
Callum Stewart
Simon Mensley
Ashton Clanfield
+44 (0) 20 7710 7600

Panmure Gordon (UK) Limited (Joint Broker)
John Prior
Hugh Rich
Dougie Mcleod
+44 (0) 20 7886 2500

Camarco (Financial PR)
Gordon Poole
Nick Hennis
+44 (0) 20 3757 4980

Further Information:

About AEX

AEX’s principal business objectives are the identification, acquisition, exploration and development of gold properties in Greenland. The Corporation’s principal asset is a 100% interest in the Nalunaq Project, an advanced exploration stage property with an exploitation license including the previously operating Nalunaq gold mine. The Corporation has a portfolio of gold assets covering 3,870km ² , the largest portfolio of gold assets in Southern Greenland covering the two known gold belts in the region. AEX is incorporated under the Canada Business Corporations Act and wholly owns Nalunaq A/S, incorporated under the Greenland Public Companies Act .

Forward-Looking Information

This press release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Corporation’s current expectations regarding future events and the future growth of the Corporation’s business. In this press release there is forward-looking information based on a number of assumptions and subject to a number of risks and uncertainties, many of which are beyond the Corporation’s control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to the factors discussed under “Risk Factors” in the Final Prospectus available under the Corporation’s profile on SEDAR at www.sedar.com. Any forward-looking information included in this press release is based only on information currently available to the Corporation and speaks only as of the date on which it is made. Except as required by applicable securities laws, the Corporation assumes no obligation to update or revise any forward-looking information to reflect new circumstances or events. No securities regulatory authority has either approved or disapproved of the contents of this press release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Inside Information

This announcement contains inside information for the purposes of Article 7 of the UK version of Regulation (EU) No. 596/2014 on Market Abuse (“UK MAR”), as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018, and Regulation (EU) No. 596/2014 on Market Abuse (“EU MAR”).

SOURCE: AEX Gold Inc.

View source version on accesswire.com:
https://www.accesswire.com/661613/AEX-Gold-Inc-Reports-Second-Quarter-Financial-Results-Operational-Update-and-Board-Changes