1SN First Tin Plc

During the period, we announced the appointment of Bill Scotting as Chief Executive Officer, who officially began his role post period end, in January 2024. Bill has over 35 years of industry experience and a proven track record in the metals and mining sector and the Board is confident that under Bill's leadership, First Tin is best placed to continue making strong operational progress at both our flagship assets.

 

On behalf of the Board, I would like to thank Thomas Buenger for his significant contribution to First Tin since its IPO in April 2022. We wish him all the best for the future.

 

We were also pleased to welcome Ross Ainger to the Board as a Non-Executive Director on 6 September 2023. Ross, who has been Company Secretary since March 2022, has extensive knowledge of the business and has already proven to be of great value to the Board. Ross was also appointed Chairman of the ESG Committee and a member of the Audit/Risk and Remuneration/Nominations Committees.

 

The period ahead promises to be another busy one. We especially look forward to the completion of the Taronga DFS, which will support offtake and project financing discussions, complete the Environmental Impact Statement (EIS) and continue the environmental permitting and mining approval process.  At our Tellerhäuser asset, we will focus on essential permitting work and the MRE update. 

 

First Tin remains poised to capitalise on the opportunities presented by the technological revolutions supporting the global energy transition. Our commitment to delivering ethical and sustainable tin production continues to drive our objectives and position us for long-term success and I look forward to keeping you updated on our progress.

 

I would like to thank our dedicated team, supportive shareholders, and stakeholders for their continued trust and collaboration as we navigate towards a sustainable and prosperous future for First Tin.

 

 

C Cannon Brookes
Chairman

 

 

 

 

CHIEF EXECUTIVE OFFICER'S REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

 

The period under review saw First Tin make significant strides in advancing both its projects in Australia and Germany, laying a solid foundation for sustained growth and success. Having joined First Tin just three months ago, at the start of 2024, I am pleased to see the progress during the period under review.

 

I feel privileged to have been selected by the First Tin Board to lead the next stage of the Company's development and I am excited by the vision of the Company and the quality of our assets. I would like to thank my predecessor, Thomas Buenger, for his leadership since the IPO, putting in place the building blocks to progress our assets along the paths of permitting and preparation of the Definitive Feasibility Studies (DFS).

 

The structural shifts in the tin market, together with the increased recognition of tin as a critical metal for the energy transition and the digital revolution, present significant opportunities. Our projects, strategically located in the safe, compliant jurisdictions of Australia and Germany, ideally position us to capitalise on this opportunity. With Taronga leading the charge as one of the largest tin development projects globally, boasting a mineralogy conducive to easy, cost-effective mining and processing, I am confident that we are poised for success.

 

Tin, a critical metal for the future

 

Tin is one of the oldest metals in use yet remains ever present in modern life, integral to various technologies such as electronics, PCBs, semiconductors and renewable energy systems. Recognised as pivotal in the energy transition and digital revolution, tin is experiencing heightened demand driven by advancements in electronic devices, robotics, 5G, and artificial intelligence.

 

Referred to as the "hidden gem" and the "glue in electronics," tin has strategic importance, classified as critical in numerous jurisdictions due to supply chain vulnerabilities. With primary supply stagnating and major producers facing challenges, including diminishing reserves and operational disruptions, a supply deficit looms.

 

Primary tin supply has stagnated over the last five years, with over 75% coming from just five countries: China, Indonesia, Myanmar, Peru and Bolivia. During 2023 we continued to see major disruptions to supply, including declining feedstocks and grades in China, delays in licensing and operational challenges with offshore dredging in Indonesia, conflict in Myanmar leading to suspensions of mining activities in Wa state and civil unrest in Peru.

 

There is an overarching trend in tin supply pointing towards a deficit against demand, as existing supply remains stagnant, easy to mine alluvial deposits become exhausted or environmentally untenable, and stocks continue to decline. As demand recovers and grows, forecasts indicate a widening supply deficit, leading to structurally higher prices necessary to facilitate the emergence of new supply sources.

 

We are confident that First Tin remains well positioned to take advantage of this opportunity and become a material tin supplier from its conflict-free and low political risk jurisdictions.

 

Delivering on the expansion potential at our Taronga Asset in Australia

 

Our Taronga project in New South Wales has been a focal point of operational excellence and strategic advancement. Acquired in 2022, Taronga stands as a low-risk asset in a jurisdiction rich with infrastructure and historical exploration data. The surrounding area has had over a century of exploration and development with many underexplored tin showings providing major upside potential. 

 

Since its acquisition in 2022, First Tin has completed infill and extension diamond and Reverse Circulation (RC) drilling to confirm historical data and test for extensions to the south of the deposit. Twin diamond drilling of 1,657m in 14 drillholes and twin RC drilling of 664m in six drillholes was completed and found statistically good agreement between Taronga Mines Pty Ltd (TMPL) and earlier Newmont assays. 

 

A total of 4,035m infill and extension RC drilling was completed in 40 drill holes (three abandoned) and has extended the Payback Zone mineralisation for approximately 400m to the southwest. Given that the southernmost line of drilling returned significant mineralisation, we believe there is strong potential for the mineralisation to the southwest to be extended even further.

 

The drilling undertaken at Taronga during the year facilitated the publication of an updated Mineral Resource Estimate ("MRE"), which was a major milestone during the period. Prepared by independent geological consultants H&S Consultants Pty Ltd in accordance with the 2012 JORC Code & Guidelines, the updated MRE is reported using a 0.05% tin (Sn) cut-off to a maximum depth of 300m below surface (650mRL).

 

Category	Tonnage (Million)	Grade (% Sn)	Tin (Tonnes)
Measured	33.0	0.13	44,200
Indicated	38.9	0.11	42,000
Sub-Total (M&I)	71.9	0.12	86,200
This Inferred	61.1	0.09	61,100
TOTAL	133.0	0.10	138,300

 

 

This is a substantial 240% increase in size on the previous MRE announced by Aus Tin Mining Ltd in 2014 which was calculated using a 0.10% Sn cut-off.  The lower cut-off for the updated Mineral Resource is based on revised economic considerations including higher 3-year trailing tin prices, lower AUD:USD exchange rates and preliminary estimates of mining, processing and G&A costs.

 

A direct comparison with the 2014 MRE by using a 0.10% Sn cut-off is:

 

	2014 MRE				H&SC 2023 MRE			Percentage Change (%)
	Tonnes (Million)	Grade (%Sn)	Tin (Tonnes)		Tonnes (Million)	Grade (%Sn)	Tin (Tonnes)
Measured	-	-	-		21.5	0.17	35,700	-
Indicated	26.9	0.17	45,200		16.5	0.16	26,000	(42.5)
Sub-Total	26.9	0.17	45,200		38.0	0.16	61,700	36.5
Inferred	9.4	0.13	12,000		13.4	0.14	18,600	55
TOTAL	36.3	0.16	57,200		51.7	0.16	80,300	40.4

 

 

The comparison represents a 40% increase in total contained tin metal based on the same cut-off. The difference is primarily due to:

 

·      Exploration drilling by First Tin successfully extending the Mineral Resource to the southwest of the existing estimate

·      A new geological interpretation 

·      A reconfigured grade interpolation technique

 

It also included a Measured Resource category for the first time. This is based on the successful hole twinning drill programme conducted by First Tin which validated the Newmont drilling data alongside a more in-depth study of the Newmont QAQC data which confirmed the reliability of the historic drilling data.

 

The DFS is now well advanced, with completion expected in the coming weeks. 

 

Towards this end of the period under review, key workstreams showed that our Taronga tin deposit is amendable to low strip ratio (ca., 1:1) open pit mining, giving relatively low mining costs. There are very few open-pit tin mines or projects worldwide and this style of deposit is seen as the transition between alluvial and underground mining. The mineralogy allows a simple processing flow sheet, with lower capital expenditure and operating costs. Crushing pre-concentration test work undertaken in the period confirmed significant upgrading effects for both high-grade and low-grade mineralisation bulk samples. Due to selective breakage along veins, liberation of cassiterite can be achieved simply by coarse crushing to 12mm and screening at 2.8mm. The plus 2.8mm fraction is a discard, while the minus 2.8mm fraction goes through the processing plant.

 

Further end-to-end mineral processing test work on a bulk sample with an average grade of 0.18% Sn confirmed that the cassiterite is easily liberated at a coarse crush size and that a good quality pre-concentrate can be obtained using very simple gravity separation techniques.

 

Using coarse gravity techniques only (i.e. no fine tin recovery) and a processing route that consists only of crushing, jigs, spirals, grinding and shaking tables, followed by standard tin dressing techniques including finer grinding and sulphide flotation, earlier testwork demonstrated that end to end processing resulted in 52-56% of the total tin recovered into a plus 56% Sn, low impurity tin concentrate. 

 

Post period end, the Company announced that additional mineral processing test work has shown enhanced recoveries from the gravity circuit of the project. ALS Laboratory in Burnie, Tasmania, one of the foremost laboratories for tin processing testwork worldwide, recently completed gravity circuit test work on a low grade bulk sample and a variability core sample crushing pre-concentrates which returned:

 

·      Low grade bulk sample (0.11% Sn):  71.5% tin recovery to a 69.8% Sn concentrate

·      Variability (0.13% Sn):   72.5% tin recovery to a 60.1% Sn concentrate

 

End to end recovery is estimated to be around 60% after taking into account losses at the crushing stage. The inclusion of a fine tin circuit will be examined later as will improvements at the crushing stage which should increase the overall recovery even further.

 

In addition, post period end, the Company reported findings from a scoping study suggesting that employing a combination of gas engines for base load power and night-time operations, complemented by solar panels for daytime support, emerges as the most economical and environmentally conscious power solution for Taronga. To enable this, the main three stage crusher would only operate during day-light hours. With this approach, it is estimated that 53% of the site's power demand would be generated by solar, and potentially reduce the power cost by 58% compared to grid power as well as significantly reducing the mine's carbon footprint.

 

Confirming Taronga as part of a tin district

 

During the period, we validated our thesis that Taronga is part of a broader tin district.

 

In August, we announced the results from wide spaced drilling undertaken at our Tin Beetle prospect, approximately 9km from the Taronga project and one of six additional satellite prospects near Taronga.

 

Mineralisation was confirmed over the 2.3km² area tested. Significant intercepts include:

 

·      48m @ 0.18% Sn from 2m incl. 21m @ 0.32% Sn from 2m and 3m @ 0.28% Sn from 42m

·      30m @ 0.10% Sn from surface incl. 7m @ 0.16% Sn from 21m (entire hole mineralised)

·      18m @ 0.07% Sn from 17m incl. 9m @ 0.10% Sn from 17m

·      78m @ 0.08% Sn from 7m incl. 12m @ 0.11% Sn from 7m and 12m @ 0.13% Sn from 48m

·      57m @ 0.05% Sn from 62m

·      27m @ 0.08% Sn from 76m incl. 14m @ 0.12% Sn from 77m and 5m @ 0.18% Sn from 85m

 

These intercepts are similar to early drill intercepts at the main Taronga mineralisation. As a satellite, there is potential for on-site upgrading before being taken by road to a central milling facility at Taronga.  If successful, this concept could significantly add to the annual tin production and/or increase the overall life of the Taronga tin project.  Further drilling is planned once the Taronga DFS is completed.

 

These findings were supported by the results from the first systematic soil sampling conducted across the Taronga site, reported post period end. Not only did this programme confirm extensions to the known mineralisation to the northeast and southwest at Taronga, but it also identified several potential nearby satellite tin mineralisation targets and confirmed that no significant mineralisation occurs beneath the proposed rock dumps at the Taronga mine itself.

 

As a result, we are increasing our landholding and during the period applied for a large, 276.6km2 Exploration License covering the majority of the Tingha Field, located approximately 50km southwest of the Taronga Project.  Tingha is one of three main tin fields in northern NSW and south-eastern Queensland that form the New England Tin Corridor.  TMPL currently holds the majority of the Emmaville Tin Field under its existing tenure.  Following the granting of the license in October 2023, TMPL now has access to most of the known tin mineralised areas in north-eastern New South Wales, which consolidates the exploration potential around the Taronga deposit.

 

Progressing Tellerhäuser, Germany

 

Our Tellerhäuser project is situated in the renowned tin district of Saxony, benefitting from access to existing infrastructure that reduces the anticipated capital expenditure.  The project is owned by First Tin's 100% owned German subsidiary, Saxore Bergbau GmbH ("Saxore").

 

During the period Saxore continued to assess the additional historic drilling data from previously inaccessible old Wismut uranium exploration drillholes discovered in archives pertaining to the Tellerhäuser project area. The Wismut drillhole data could now be reviewed due to a change in the law (Geological Data Act). The additional identified data represents an equivalent of 1311 underground drillholes, surface drillholes and channel samples with a total length of more than 44,900m and is still being analysed alongside the data from the more recent drilling programme. All new data is currently being added to the main database and should result in an increasingly robust resource model and may lead to additional resource tonnes. Once this analysis is complete, the Company expects to announce an update to the project's MRE.

 

In November 2023, a model of the groundwater flow was completed which showed that a mining-induced dewatering of low-laying groundwater horizons will not impact surface water bodies. The drinking water fountains that still operate sporadically in the area will not be affected as they are fed from the upper groundwater layers.

 

During the year, infrastructure requirements were progressed, with an analysis and comparison of alternative transport routes from the site completed. The German Rail Infrastructure Agency (DB InfraGo AG) informed us that space has been reserved at the railway station (Grünstädtel) for our future planning. Work commenced on the baseline study for power requirements underground as well as on the surface.

 

Saxore signed an emergency assistance agreement with Wismut AG to practice regularly with the established mine rescue team. The mine design was further specified with an updated ventilation study, considering also emergency situations underground. Further a backfill concept study in cooperation with Patterson & Cook was concluded enabling our sustainable leave no trace strategy.

 

Gottesberg, Germany to be evaluated

 

Progress on Gottesberg has been constrained as the Company has focused on Taronga and Tellerhäuser.  It has a large resource base and excellent mineral processing characteristics and could benefit from lessons learned at Taronga.  It is proposed to more closely evaluate this project over the next 12-24 months.

 

 

Finance Review

 

The interim results for the period reflect continued investment by the Company in progressing its two flagship assets through permitting and DFS study.

 

First Tin posted a comprehensive loss for the period of £2.82m and ended the period with a cash balance of £4.66m and a net asset value of £38.97m.  Expenditure during the period was primarily focused on drilling activities to extend the MREs, mineral processing test work, other DFS and permitting related work to progress the development of our two assets. It is anticipated that the Group will need to raise additional capital within the next 12 months in order to continue to fund its activities at their planned levels.

 

Outlook

 

During the period under review, the Company made significant progress in developing its assets, particularly at Taronga in Australia. Our focus in 2024 and beyond will be on:

 

·      The completion of our Taronga DFS at the end of Q1 2024 and completion of its Environmental Impact Statement (EIS) in July 2024.

·      Completion of the data analysis and update of the MRE at Saxore.

·      Evaluating financing options to advance Taronga through permitting and engineering design.

 

We remain bullish on the macro-outlook for the tin market. Despite cyclically constrained demand in 2023, the supply constraints led the tin market to end 2023 with only a modest surplus.  Moving into 2024, the tin market is buoyant as supply concerns are meeting a demand recovery. We have already seen the tin price recover from $23k/t at the end of November to over $28.5k/t in mid-March.

 

The demand for tin remains strong, with lower interest rates, stimulus efforts by the Chinese government, and the continuous transition to green energy, creating the conditions for a material supply ongoing deficit from 2026. 

 

We are confident that First Tin remains well positioned to benefit from this opportunity and become a material supplier of conflict-free tin from our low political risk jurisdictions in Australia and Germany. With our strategic approach and business model, we are poised to unlock the significant value within our tin assets.

 

I would like to thank all our shareholders for your ongoing support of First Tin as we pursue our strategic objectives. We have entered 2024 with confidence and I look forward to delivering and communicating our progress as we continue to develop our flagship assets and fulfil our ambitions to become a leading supplier of tin.

 

W A (Bill) Scotting
Chief Executive Officer

 

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2023

 

 

			Note	2023		2022
				(Unaudited)		(Audited)
				£		£
Administrative expenses				(2,355,495)		(3,240,389)
Operating loss				(2,355,495)		(3,240,389)
Finance income				100,104		-
Finance costs				(23)		(2,557)
Loss before tax				(2,255,414)		(3,242,946)
Income tax expense				-		-
Loss for the year				(2,255,414)		(3,242,946)
Other comprehensive (loss)/income
Exchange differences on translation of foreign
operations				(561,581)		118,937
Other comprehensive (loss)/income for the
year				(561,581)		118,937
Total comprehensive loss for the year				(2,816,995)		(3,124,009)
Total comprehensive loss attributable to
the equity holders of the company				(2,816,995)		(3,124,009)
Basic loss - pence per share			5	(0.85)		(1.40)
Diluted loss - pence per share			5	(0.85)		(1.40)

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

 

 

	Note	2023		2022
		(Unaudited)		(Audited)
		£		£
Non-current assets
Intangible assets	7	33,084,761		27,367,552
Property, plant and equipment	8	2,474,661		1,589,748
		35,559,422		28,957,300
Current assets
Trade and other receivables	9	278,925		808,711
Cash and cash equivalents		4,657,026		13,823,173
		4,935,951		14,631,884
Current liabilities
Trade and other payables	10	(1,528,482)		(1,805,298)
Net current assets		3,407,469		12,826,586
Total assets less current liabilities		38,966,891		41,783,886
Net assets		38,966,891		41,783,886
Capital and reserves
Called up share capital	12	265,535		265,535
Share premium account		18,391,046		18,391,046
Merger relief reserve		17,940,000		17,940,000
Warrant reserve		269,138		269,138
Retained earnings		2,632,180		4,887,594
Translation reserve		(531,008)		30,573
Shareholders' funds		38,966,891		41,783,886

 

The Condensed Consolidated Financial Statements were approved and authorised for issue by the Board of Directors on 27 March 2024 and were signed on its behalf by:

 

 

 

 

C Cannon Brookes
Director

 

 

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

 

 

				2023		2022
				(Unaudited)		(Audited)
				£		£
Cash flows from operating activities
Operating loss for the period				(2,355,495)		(3,240,389)
Adjustments to reconcile loss before tax to net   cash flows:
Depreciation of tangible assets				54,265		20,597
Loss on disposal of tangible assets				18,009		-
Share-based payment expense				-		707,100
Decrease in trade and other receivables				529,786		(357,635)
(Decrease)/increase in trade and other payables				(276,816)		1,503,846
Cash used in operations				(2,030,251)		(1,366,481)
Interest paid				(23)		2,557
Net cash flows used in operating activities				(2,030,274)		(1,369,038) 88
Cash flows from investing activities
Purchase of intangible assets				(6,356,040)		(5,288,557)
Receipt of government grants				218,212		-
Purchase of property, plant and equipment				(1,024,659)		(600,907)
Cash acquired on acquisition of Taronga				-		102
Interest received				100,104		-
Net cash flows used in investing activities				(7,062,383)		(5,889,362)
Cash flows from financing activities
Proceeds from issue of shares				-		19,000,000
Share issuance costs				-		(368,521)
Net cash flows generated from financing activities				-		18,631,479
Net (decrease)/increase in cash				(9,092,657)		11,373,079
Cash and cash equivalents at beginning of year				13,823,173		2,503,714
Exchange loss on cash and cash equivalents				(73,490)		(53,620)
Cash at the end of year				4,657,026		13,823,173