Vast Resources (VAST ) announced it has raised £1.467m through the placing of 652m ordinary shares at a price of 0.225p/share via its joint broker Axis Capital Markets.
Vast said it would use the proceeds to maintain sufficient levels of working capital and cover transaction costs linked to possible new opportunities.
Following the placement, Vast expects to have cash of c. £1.556m and near-term liabilities of £933K. Vast expressed confidence in maintaining sufficient operating cashflow and resources, as well as having access to further funding in the future as needed.
Vast also said production at its Baita Plai Polymetallic Mine in Romania continued to increase per its 21 October announcement. A sale of concentrate from Baita Plai is scheduled for this month, and the company expects another sale to occur in the middle of November.
Separately, Vast announced audited final results for the 12-month period ended 30 April 2022. Vast saw an increase in revenues in the year of US$3.8m compared to last year's US$0.9m. There was also a 6.6% increase in administrative and overhead expenses to US$4.5m.
The company sustained a forex loss of US$3.8m compared to gains of US$2.6m the previous year, due to USD-denominated funding of its Romanian Lei functional currency subsidiaries. This was partially offset by forex translational gains of US$2.2m. Vast funds its Romanian businesses in USD as that funding will be repaid from USD-denominated sales.
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While Vast recorded a wider loss in the 12 months to 30 April 2022, the vast majority of the increase was attributable to forex movements. Mill feed at the company's flagship Baita Plai asset in Romania more than doubled during the referenced period from 14,452 tonnes/year to 38,108 tonnes/year. Since 30 April, Vast has continued to implement a full transition to mechanised mining at Baita Plai, responsible for most of the YTD production gains at the site.
In 3Q22, Vast recorded a 20% increase in production from Baita Plai. Due to utilisation of two Mantis CMR4 Jumbo rigs, September was the most successful month of underground production at the site. The mine produced 7,900 tonnes of ore, accounting for 50% of production in 3Q22. 4Q22 saw a further increase, with current prepared accessible underground ore at c. 290,000 tonnes.
The trend is expected to continue following the transition to mechanised mining, utilising Long Hole Stope methodology. The completion of Spiral number 3 will further increase the volume of production at Baita Plai from Q2 2023.
Additionally, Vast's 24.5%-owned Takob polymetallic JV in Tajikistan was recently boosted by an exclusive offtake agreement with Trafigura, a major Singapore-based commodity trading company. And in Zimbabwe, Vast expects to conclude its mining agreement with the Zimbabwe Consolidated Diamond Company regarding the right to mine diamonds in the country.
Overall, the economic fundamentals for Vast's polymetallic business remain strong. Increased demand for copper and tightness in supply have significantly lifted copper prices. The forecast global growth in EVs will keep pressure on supply over the next decade, exacerbated by declining grades, water supply issues, and community resistance. Demand for other critical metals used in renewable tech will follow a similar trajectory.
Vast's bullish outlook on polymetallics is therefore justified. Moreover, a continued reduction in Romanian and Zimbabwean country risk premiums has the potential to provide significant medium-term growth for the company. In both countries, Vast holds further mining claims and other interests, which are under appraisal.
Today's placing ensures Vast's operations continue to be supported over the coming months.
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