TIDMCOBR
RNS Number : 7767X
Cobra Resources PLC
28 April 2023
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28 April 2023
Cobra Resources plc
("Cobra" or the "Company")
Final Results for the Year Ended 31 December 2022
Cobra, a gold, rare earth and IOCG exploration company focused
on the Wudinna Project in South Australia, announces its final
results for the year ended 31 December 2022.
Highlights
-- Executed several exploration programmes including 4,000m of
Aircore ("AC") drilling, 800m of Reverse Circulation ("RC")
drilling, re-analysis of over 275 historical drillhole samples, and
multiple geophysical surveys
-- Programme defined Rare Earth Elements ("REE") resource above
and proximal to gold mineralisation, as well as further
along-strike gold mineralisation at the Clarke prospect
-- Raised total of GBP2,279,500 through private placements to
fast-track rare earth and gold resource growth through exploration
activities, and provide sustaining capital
-- Awarded additional exploration tenements considered highly
prospective for gold and rare earth mineralisation, expanding
Cobra's Gawler Craton landholding to 3,621 km(2)
-- Cash and cash equivalents at year-end of GBP1,272,742 (31 December 2021: GBP264,480)
Post Year End
-- Published in January 2023 a maiden rare earth JORC Mineral
Resource of 20.9 Mt at 658 ppm Total Rare Earth Oxides, enabling a
strategic baseline to advance an economically beneficial
combination of gold and rare earth resources
o Defined significant rare earth Exploration Target at the
Thompson prospect demonstrating district scale potential of rare
earth mineralisation at Wudinna
-- Completed in March 2023 20 RC drillholes for 2,466m across
Barns, White Tank and Clarke prospects aimed at gold resource
expansion
o Drilling intersected encouraging geology supportive of further
gold and rare earth mineralisation across all three prospects
o Assays submitted to laboratory with initial results expected
imminently
-- Commenced in March 2023 a 6,000m AC drilling programme
targeting rare earth resource expansion and other objectives
-- Announced in April 2023 the fulfillment of Stage 3
expenditure obligations to increase ownership of the Wudinna
Project to 75%
Greg Hancock, Chairman of Cobra, commented:
"I am pleased to report on a year of exceptional advancement for
Cobra, where we have not only expanded the extent of gold
mineralisation outside of our existing gold resources, but defined
a complementary opportunity in overlying rare earth
mineralisation.
The Company is now in the enviable position to expand
complementary gold and rare earth resources in a time where fiscal
uncertainty is driving a rising gold market and the ethical
sourcing of rare earths is critical to global decarbonisation
through electrification. To have this opportunity in a single
project benefitting from close spatial proximity of resources in an
attractive mining jurisdiction is an advantage not many junior
explorers can claim."
Enquiries:
Cobra Resources plc via Vigo Consulting
Rupert Verco (Australia) +44 (0)20 7390 0234
Dan Maling (UK)
SI Capital Limited (Joint Broker)
Nick Emerson
Sam Lomanto
+44 (0)1483 413 500
Shard Capital Partners LLP (Joint
Broker)
Erik Woolgar
Damon Heath +44 (0)20 7186 9952
Vigo Consulting (Financial Public
Relations)
Ben Simons
Charlie Neish
Kendall Hill +44 (0)20 7390 0234
The person who arranged for the release of this announcement was
Rupert Verco, Managing Director of the Company.
About Cobra
Cobra is defining a unique multi-mineral resource at the Wudinna
Project in South Australia's Gawler Craton, a tier one mining and
exploration jurisdiction which hosts several world-class mines.
Cobra's Wudinna tenements, totalling 3,261 km(2) , contain
extensive orogenic gold mineralisation and are characterised by
potentially open-pitable, high-grade gold intersections, with ready
access to infrastructure. Cobra has 22 orogenic gold targets
outside of the current 211,000 Oz gold JORC Mineral Resource
Estimate. In 2021, Cobra discovered rare earth mineralisation
proximal to and above the gold mineralisation which has been
demonstrated to be regionally scalable. In 2023, Cobra published a
maiden rare earth JORC Mineral Resource Estimate of 20.9 Mt at 658
ppm Total Rare Earth Oxides enabling a strategic baseline to
advance an economically beneficial combination of gold and rare
earth resources.
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CHAIRMAN'S STATEMENT
INTRODUCTION
I am pleased to report on a year of exceptional advancement for
Cobra, where we have not only expanded the extent of gold
mineralisation outside of our existing gold resources, but defined
a complementary opportunity in overlying rare earth
mineralisation.
The team's approach to defining the economic potential of rare
earths at Wudinna has been considered and cost efficient. Initial
metallurgy demonstrates significant economic potential, whilst the
knowledge gained of the geological process that both enriches and
develops various rare earth mineral phases places us in a position
to discover further rare earth mineralisation with higher
quantities of ionic mineralisation, and to advance metallurgical
testing of our defined rare earth resource.
During the year, we were awarded a South Australia Advanced
Discovery Initiative ("ADI") grant that has enabled us to test
multiple geophysical processes that have defined a number of
targets peripheral to the Clarke prospect and highlighted
geophysical characteristics that define both gold and rare earth
mineralisation.
The Wudinna landholding was strategically grown during the year
through the awarding of additional mineral exploration tenements,
which now see the Company's Gawler Craton land tenure totalling
3,621 km(2) .
In the midst of a year of significant rising expenses across our
sector, the team has managed to execute a number of exploration
programmes, including a regional Rotary Air Blast ("RAB") programme
and the aforementioned geophysical surveys, whilst we also defined
over 15 rare earth occurrences through re-analysis of historical
drill samples. Despite an unseasonably wet spring reducing our
Reverse Circulation ("RC") programme, the results of drilling
extended gold mineralisation at the Clarke prospect to over
600m.
The Company is now in the enviable position to expand
complementary gold and rare earth resources in a time where fiscal
uncertainty is driving a rising gold market and the ethical
sourcing of rare earths is critical to global decarbonisation
through electrification. To have this opportunity in a single
project benefitting from close spatial proximity of resources in an
attractive mining jurisdiction is an advantage not many junior
explorers can claim.
BACKGROUND
Cobra began life as a publicly listed company with the aim of
finding suitable precious, base or other energy metals and minerals
projects in Australia or Africa. During 2019, the Board identified
several potentially suitable projects, which were reviewed in
detail to evaluate their strengths, growth potential and long-term
value to shareholders.
The Wudinna Project has been the Company's primary focus since
acquiring earn-in rights to the project in 2019 through the
negotiation of the "Wudinna Heads of Agreement". The primary
objective of the Company's exploration focus to date has been to
add to the existing 211,000 Oz gold JORC Mineral Resource Estimate.
The articulated strategy to achieve this has been through refining
resource extension opportunities, and defining near-resource
targets through low-cost, high-value geochemical domaining of
elemental signatures reflective of existing gold
mineralisation.
Since Cobra's involvement in the Wudinna Project began in 2019,
the Company's approach to exploration has been to provide
considered exposure to exploration success across a range of
commodities, considerate of cost and discovery potential from a
world-class mineral domain.
The balance of exploration activities executed in 2022 have
focused on our three-pronged approach:
1. Systematically grow existing gold resources towards 1 million Oz
2. Define the mineral potential of rare earths
3. Advance high-value IOCG targets
Our strategy is to advance exploration targeting by endorsing
technological advancement and implementing cost-effective
exploration, where targets are de-risked through geophysical and
geochemical definition, yielding a pipeline of targets from concept
through to resource definition.
Owing to the discovery of rare earths at the Clarke prospect in
2021, the Company defined a strategic and cost-efficient
exploration programme with dual considerations to advance gold
resources, expand on the rare earth discovery to define economic
potential and advance copper-gold targets.
The Company's adopted approach maximises value from existing
datasets, and minimises costs and environmental disturbance. The
Company was awarded a South Australian ADI grant to execute two
geophysical programmes aimed at testing new techniques to define
the magnetic and resistive features of mineralised structures at
the Clarke prospect, advancing prospect growth, and identifying
other regional targets.
Rare earth mineralisation has been defined across 15 targets
where grades and intersections are of economic interest. Through
re-analysis and Aircore drilling, sufficient drill density enabled
the Company to announce a post-period, maiden Rare Earth Elements
("REE") JORC resource estimate of 20.9 Mt at 658 ppm Total Rare
Eearth Oxides ("TREO") where Magnet Rare Earth Oxides ("MREO")
equate to 23.6% of the TREO. The rare earth mineral resource occurs
above and proximal to a defined 94, 000 Oz gold resource at the
Baggy Green prospect and overlies 500m of intersected gold
mineralisation at the Clarke prospect.
The regional rare earth prospectivity of the project is
demonstrated by the defined Exploration Target at the Thompson
prospect of 81-233 Mt at an average grade of 640-856 ppm TREO.
The defined rare earth resource from just 12 months of rare
earth focused work, together with its complementary nature to the
Company's 211,000 Oz gold resource, places the Company in a unique
position to grow dual commodity resources.
Through the 2022 exploration programme, the Company has achieved
the 75% project earn-in milestone defined under the terms of the
Wudinna Heads of Agreement between Lady Alice Mines Pty Ltd (a
Cobra Resources Company) and Peninsula Resources (an Andromeda
Metals subsidory). Both parties are working to consolidate the
structure in which the parties intend to progress the Wudinna
Project.
OPERATIONAL REVIEW
Results from the 2022 exploration programme have been
transformative in defining a rare earth resource that is
complementary to a growing gold resource. The 2022 exploration
programme included:
-- The re-analysis of samples from over 275 (13,150m) historical
drillholes testing for lanthanides
-- Drilling of 91 Aircore drillholes for over 4,000m
-- 28.2 line km of Loupe TEM profiling at the Clarke prospect
-- 12.6 line km of Controlled Source Audio-Frequency Magnetotellurics at the Clarke prospect
-- 800m of RC drilling at the Clarke prospect
Rare Earth Re-analysis of Historical Drill Samples
Available samples from historical drilling enabled the
evaluation and definition of rare earth mineralisation across gold
resources and regional gold targets. Signature intersections
yielded from re-analysis included:
Clarke prospect:
-- WUD6-0561 intersected a true width of 7m at 1,465 ppm TREO
from 41m, including 6m at 2,499 ppm TREO from 42m
-- WUD6-0552 intersected 12m at 1124 ppm TREO from 18m
Thompson prospect:
-- SCH-0922 intersected 31m at 1,427 ppm TREO from 12m, including 12m at 3,168 ppm TREO from 12m
-- KO11S-1133 intersected 30m at 1,124 ppm TREO (MREO 27%) from
18m, including 18m at 1,445 ppm TREO from 24m
-- KO11S-1074 intersected 15m at 1,198 ppm TREO (MREO 29%) from 18m
-- SCH-0939 intersected 6m at 1,839 ppm TREO from 36m
Baggy Green prospect:
-- WUD6-0763 intersected 22m at 716 ppm TREO from 12m
-- WUD6-0685 intersected 30m at 681 ppm TREO from 18m
Anderson prospect:
-- WUD1-0231 intersected 18m at 2,024 ppm TREO from 24m,
including 12m at 2,767 ppm TREO from 30m, above the previously
reported 1m at 1.013 g/t gold from 79m
-- WUD1-0383 intersected 40m at 641 ppm TREO from 12m, including 6m at 1,077 ppm TREO from 36m
-- WUD1-0328 intersected 15.6m at 612 ppm TREO from 15.5m
Aircore Drilling Programme
Aircore drilling was used to follow-up rare earth re-analysis
results, de-risk follow-up gold focused RC drilling at Clarke, and
to provide geochemical samples to refine IOCG targets 1-3. Through
this programme, Cobra:
-- Defined further gold mineralisation at Clarke, where CBAC0014
intersected 12m at 1.25 g/t gold from 18m, increasing the
intersected strike extent at Clarke beyond 500m
-- Refined further gold targets at Clarke, where broad zones of
gold in saprolite has been defined north of previously intersected
gold mineralisation. In comparison to drilled mineralisation zones,
the anomalous zones northwest of Clarke are more significant,
supporting further mineralisation down-dip and along-strike where
notable saprolite intersections included:
o 16m at 0.22 g/t gold from 12m, including 2m at 0.9 g/t gold
from 16m [CBAC0020]
o 12m at 0.29 g/t gold from 18m [CBAC0013]
o 18m at 0.14 g/t gold from 14m [CBAC0007]
o 6m at 0.31 g/t gold from 16m [CBAC0027]
o 10m at 0.16 g/t gold from 10m [CBAC0016]
o 12m at 0.10 g/t gold from 20m [CBAC0009]
o 8m at 0.12 g/t gold from 50m [CBAC0017]
-- Expanded the zone of high-grade rare earth mineralisation at
Clarke, with significant intersections demonstrating basket
assemblages, lithologies and environmental conditions supportive of
ionic adsorption mineralisation. Signature intersections
included:
o 14m at 3,703 ppm TREO from 18m, including 6m at 6,648 ppm TREO
from 22m [CBAC0021]
o 10m at 2,220 ppm TREO from 42m, including 2m at 8,163 ppm TREO
from 48m [CBAC0022]
o 34m at 854 ppm TREO from 16m, including 4m at 1,205 ppm TREO
from 34m [CBAC0023]
o 26m at 928 ppm TREO from 14m, including 6m at 2,046 ppm TREO
from 22m [CBAC0027]
-- Yielded numerous rare earth intersections across nine
regional targets, demonstrating regional scalability and
prospectivity for clay-hosted rare earth mineralisation, where
high-grade mineralisation supports scalable footprints:
o At Thompson, where CBAC0085 intersected 32m at 1,336 ppm TREO
from 8m, with the MREO equating to 25% of the TREO
o At Barns, peripheral to the gold resource where CBAC0065
intersected 32m at 920 ppm TREO from 24m, with the MREO equating to
26% of the TREO
o At Anderson, where CBAC0075 intersected 8m at 2,535 ppm TREO
from 18m, with the MREO equating to 29% of the TREO
o At Bradman, where CBAC0059 intersected 10m at 869 ppm TREO
from 32m, with the MREO equating to 24% of the TREO
-- Tested saprolite above three of the Company's IOCG
geophysical targets, where geochemical analysis demonstrates
prospectivity for copper/gold porphyry style mineralisation
Due to the complexity of rare earth mineralisation, the
Company's approach to defining the economic potential of rare earth
mineralisation was to identify rare earth mineral phases, confirm
clay adsorption and confirm metallurgical potential. This was
successfully achieved through collaborations with a number of
academic and world-leading research institutions. Technical studies
implemented to define rare earth mineralisation potential at the
Wudinna Project included:
Mineralogical determination by X-Ray Diffraction ("XRD")
analysis, performed by the Commonwealth Scientific and Industrial
Research Institute ("CSIRO"), where:
-- XRD analysis supports that a component of rare earth bursary
is adsorbed to the primary clay particles, being kaolin and
montmorillonite, in similar fashion to the highly desirable IAC
hosted deposits of southern China
Lithological analysis by HyLogger Spectral Analysis, performed
by the Geology Survey of South Australia ("GSSA"), which has
demonstrated:
-- Strong associations between elevated rare earths, kaolinite
quantity, and reducing crystallinity
-- Strong associations between muscovite and phengite to gold mineralisation
Rare earth phase determination by Scanning Electron Microscopy
("SEM") performed by the Critical Minerals Institute ("UniSA")
highlighted:
-- Primary rare earth enrichment in alteration mineral
assemblages associated with hydrothermal gold mineralisation
-- Secondary rare earth minerals formed within the saprock,
where grade peaks are not directly associated with elevated
phosphate
-- Elevated rare earth grades in clays where primary and secondary rare earth phases are low
Diagnostic metallurgical testing carried out by the Australian
Nuclear Science and Technology Organisation ("ANSTO") focused on
extraction techniques adopted to ionic phase mineralisation using
H(2) SO(4) as a lixiviant, yielding recoveries of up to 34% TREE
from samples across two holes at Clarke at ambient
temperatures.
Identification of clay adsorption potential from Aircore and RC
drill samples. The Company tested the sample acidity/alkalinity via
standard soil pH tests of over 240 samples. The resultant dataset
highlight a strong association between elevated grades and pH
ranges 6-7 and 9-10. These conditions are identified through
academia as being conditions that best promote physisorption; the
process in which REEs ionically bind to clay particles.
Advanced Discovery Initiative Geophysical Surveys
In June 2022, the Company executed a 28.2 line km Loupe TEM
survey at the Clarke prospect, which:
-- Confirmed that defined gold mineralisation at Clarke is
located along distinct linear terminations bordering highly
conductive zones. This is interpreted to represent redial shear
structures promoting dilation under N-S compression
-- Identified four additional repeat structures, branching from
the major regional E-W fault, within the survey. These are
interpreted as structural juxtaposition or "dilatational jolts"
prospective for further gold mineralisation and warrant follow-up
drill testing
-- Defined three conjugate NE trending structures north of
Clarke which correlate with highly anomalous gold in saprolite
intersected in recent Aircore drilling
-- Demonstrated that high-grade rare earth mineralisation
correlates to highly conductive zones that define troughs of deep
saprolite weathering
-- Validated a cost-efficient method of defining and modelling zones prospective for rare earth mineralisation
Across November and December 2022, the Company engaged Zonge
Geophysics to execute a 12.6 line km of Controlled Source
Audio-Frequency Magnetotellurics ("CSAMT") at the Clarke prospect,
which demonstrated that:
-- Increases in saprolite depth are locally related to
structures containing gold mineralisation, hydrothermal alteration,
sulphides and subsequently elevated rare earths. Deeper weathering
profiles are considered to be a product of acidic weathering
conditions that result from the presence of sulphides
-- A zone of moderate conductivity immediately adjacent to the
interpreted Clarke gold-bearing structure is interpreted to reflect
sodic alteration associated with gold mineralisation
-- Regional, unmineralised structures display different
geophysical responses to localised mineralised structures. These
include shallow saprolite weathering and strong conductive
down-plunge responses that are thought to be related to the
presence of saline groundwater
-- Gold mineralisation is contained in second order structures
where dilation is likely increased by the relative proximity to
primary structures, and alteration subsequently yields a
de-magnetised geophysical response
Structural observations made through the CSAMT survey have been
applied to the regional Airborne Electromagnetic ("AEM") survey
conducted by Newmont in 2004. A number of demagnetised zones are
interpreted to contain first and second order structures and are
comparable to the structural interpretation at the dual gold and
rare earth Clarke prospect. Results support basement
interpretations and structural inferences derived from the Loupe
TEM survey completed in November 2022.
Seven additional targets with structural similarities and
corresponding to anomalous gold in calcrete were added to the March
2023 RC drill programme.
RC Drilling at the Clarke Prospect
A total of 11 RC holes were drilled in November 2022 totalling
800m, where:
-- The strike of intersected gold mineralisation at the Clarke
prospect was increased to 600m, occurring outside of the existing
211,000 Oz MRE through the following intersections:
o CBRC0059 intersected 6m at 4.15 g/t gold from 34m, including
4m at 5.74 g/t gold from 34m
o CBRC0057 intersected 18m at 0.6 g/t gold from 57m, including
1m at 1.80 g/t gold from 58m and 2m at 2.16 g/t gold from 68m
o CBRC0066 intersected 8m at 0.6 g/t gold from 58m, including 2m
at 1.31 g/t gold from 62m
-- Further rare earth mineralisation intersected peripheral to
expanded gold strike further supports the Company's dual resource
strategy. Rare earth intersections included:
o CBRC0058 intersected 24m at 1,093 ppm TREO from 26m, where the
MREO equates to 26% of the TREO, including 19m at 1,243 ppm TREO
from 29m (MREO: 26%)
o CBRC0062 intersected 20m at 683 ppm TREO from 31m, where the
MREO equates to 22% of the TREO, including 2m at 2,249 ppm TREO
(MREO: 19%)
o CBRC0066 intersected 31m at 514 ppm TREO from 36m, where the
MREO equates to 22% of the TREO
o CBRC0057 intersected 21m at 519 ppm TREO from 13m, where MREO
equates to 23% of the TREO
o CBRC0059 intersected 14m at 611 ppm TREO from 14m, where MREO
equates to 23% of the TREO
Gold and rare earth drilling results from the 2022 exploration
programme demonstrated the growth potential of existing gold
resources, formed the basis of a maiden rare earth resource
estimate, and demonstrated the scale potential for further resource
expansion as well as the potential for further discoveries.
ISSUES OF SHARES DURING THE PERIOD
On 16 February 2022, 63,000,000 Ordinary shares were issued
pursuant to an oversubscribed private placement at 1.5 pence each,
raising GBP945,000.
On 26 October 2022 and 1 November 2022, 88,966,668 Ordinary
shares were issued pursuant to an oversubscribed private placement
at 1.5 pence each, raising GBP1,334,500. 2,572,372 Ordinary shares
were issued to former LAM owners at 1.5p each, and 600,000 Ordinary
shares were issued to third party suppliers for settlement of fees
in lieu of cash on or around the same date.
POST PERIOD EVENTS
In January 2023, the Company took a fundamental step towards
defining a globally unique mineral occurrence by announcing a
maiden rare earth resource of 20.9 Mt at 658 ppm TREO that
encompasses the Clarke and Baggy Green gold prospects and occurs
within the saprolite above and proximal to gold mineralisation. In
addition, a defined Exploration Target at the Thompson prospect
demonstrates the district scale potential of rare earth
mineralisation at the Wudinna Project. In March 2023, the Company
completed 20 RC drillholes for 2,466m across the Barns, White Tank
and Clarke prospects aimed at gold resource expansion. Drilling
intersected encouraging geology supportive of further gold and rare
earth mineralisation across all three prospects. Assays have been
submitted to the laboratory with initial results expected
imminently. In March 2023, the Company also commenced a 6,000m AC
drilling programme targeting rare earth resource expansion and
other objectives.
CONCLUSION
The Company has managed to overcome challenging financial
conditions and record-breaking wet weather to deliver a year of
exploration success which culminated in a maiden rare earth
resource and will contribute to an expanded gold resource. This
provides a unique and valuable mineral inventory from which the
Company can grow and commence the process of determining project
economics. I thank our shareholders for their continued commitment
in uncertain times - their loyal support has enabled the Company to
achieve exploration success and will enable further growth. I thank
my fellow directors for their contribution throughout the year, our
Exploration Manager, Robert Blythman, for his tireless efforts, our
valued stakeholders, and our contractors and service providers. We
are committed to unlocking the mineral wealth of the Wudinna
Project.
Greg Hancock
Non-Executive Chairman
27 April 2023
CONSOLIDATED INCOME STATEMENT
FOR THE YEARED 31 DECEMBER 2022
Notes 31 December 31 December
2022 2021
GBP GBP
Other Income - -
Other Expenses 2 (488,608) (567,213)
Operating loss (488,608) (567,213)
Finance income and costs 3 (20,530) (1,110,298)
----------- -----------
(509,138) (1,677,511)
Change in estimate of contingent
consideration 14 - -
Loss before tax (509,138) (1,677,511)
Taxation 6 - -
Loss for the year attributable to equity holders (509,138) (1,677,511)
=========== ===========
Earnings per Ordinary share
Basic and diluted loss per share (GBP0.0010) (GBP0.0073)
attributable to owners of the Parent
Company 7
=========== ===========
All operations are considered to be continuing.
The accompanying notes are an integral part of these financial
statements.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEARED 31 DECEMBER 2022
31 December 31 December
2022 2021
GBP GBP
Loss for the year (509,138) (1,677,511)
Other Comprehensive income
Items that may subsequently be reclassified
to profit or loss:
* Exchange differences on translation of foreign
operations 290,754 (81,246)
Total comprehensive loss attributable
to equity holders of the Parent Company (218,384) (1,758,757)
=========== ===========
The accompanying notes are an integral part of these financial
statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2022
Notes
2022 2021
GBP GBP
Non-current assets
Intangible Fixed Assets 9 2,727,290 2,012,405
Property, plant and equipment 10 1,428 1,680
Total non-current assets 2,728,718 2,014,085
----------- -----------
Current assets
Trade and other receivables 11 84,469 36,891
Cash and cash equivalents 12 1,272,742 264,480
----------- -----------
Total current assets 1,357,211 301,371
----------- -----------
Current liabilities
Trade and other payables 13 79,999 50,336
Contingent consideration 14 148,914 187,500
Total current liabilities 228,913 237,836
----------- -----------
Net assets 3,857,016 2,077,620
=========== ===========
Capital and reserves
Share capital 15 5,152,495 3,601,104
Share premium account 2,794,647 1,378,561
Share based payment reserve (16,908) 962,201
Retained losses (4,348,182) (3,848,456)
Foreign currency reserve 274,964 (15,790)
----------- -----------
Total equity 3,857,016 2,077,620
=========== ===========
The accompanying notes are an integral part of these financial
statements.
These financial statements were approved and authorised for
issue by the Board of Directors on 27 April 2023.
PARENT COMPANY STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2022
Notes
2022 2021
GBP GBP
Non-current assets
Investment in subsidiary 8 432,260 432,260
Property, plant and equipment 10 1,428 1,680
Intangible Fixed Assets 9 33,251 33,251
Total non-current assets 466,939 467,190
----------- -----------
Current assets
Trade and other receivables 11 2,664,401 2,009,103
Cash and cash equivalents 12 1,075,372 200,088
----------- -----------
Total current assets 3,739,773 2,209,191
----------- -----------
Current liabilities
Trade and other payables 13 11,873 31,960
Contingent consideration 14 148,914 187,500
Total current liabilities 160,787 219,460
----------- -----------
Net assets 4,045,925 2,456,921
=========== ===========
Capital and reserves
Share capital 15 5,152,495 3,601,104
Share premium account 2,794,647 1,378,561
Share based payment reserve (16,908) 962,201
Retained losses (3,884,309) (3,484,945)
Equity shareholders' funds 4,045,925 2,456,921
=========== ===========
The Company has taken advantage of the exemption allowed under
section 408 of the Companies Act 2006 and has not included its own
income statement and statement of comprehensive income in these
financial statements. The Parent Company's loss for the period
amounted to GBP399,363 (2021: GBP1,485,505 loss).
The accompanying notes are an integral part of these financial
statements.
These financial statements were approved and authorised for
issue by the Board of Directors on 27 April 2023.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2022
Share Share Share based Retained Foreign Total
capital premium payment losses currency
reserve reserve
GBP GBP GBP GBP GBP GBP
As at 1 January 2021 2,829,566 564,173 1,006,238 (2,239,982) 65,456 2,225,451
Loss for the year - - - (1,677,511) - (1,677,511)
Translation differences - - - - (81,246) (81,246)
---------- --------- ----------- ----------- -------- ----------------
Comprehensive loss for the year - - - (1,677,511) (81,246) (1,758,757)
Shares issued - - - - - -
Share based payment expired - - (69,037) 69,037 - -
Exercise of options & warrants - - - - - -
Cost of share issue 771,538 814,388 - - - 1,585,926
Share warrant charge - - - - - -
Share option charge - 25,000 - - 25,000
---------- --------- ----------- ----------- -------- ----------------
At 31 December 2021 3,601,104 1,378,561 962,201 (3,848,456) (15,790) 2,077,620
Loss for the year - - - (509,138) - (509,138)
Translation differences - - - 9,413 290,754 300,167
Comprehensive loss for the year - - - (499,725) 290,754 (208,971)
Shares issued 1,551,390 640,289 (44,576) - - 2,147,104
Share issue cost (207,735) (207,735)
Warrants expired - 924,906 (924,906) - - -
Warrants issued 58,626 (58,626)
Share option charge 49,000 - - 49,000
At 31 December 2022 5,152,495 2,794,647 (16,908) (4,348,181) 274,964 3,857,017
---------- --------- ----------- ----------- -------- ----------------
The following describes the nature and purpose of each reserve
within equity:
Share capital: Nominal value of shares issued
Share premium: Amount subscribed for share capital in excess of
nominal value, less share issue costs
Share based payment reserve: Cumulative fair value of warrants and options granted
Retained losses: Cumulative net gains and losses, recognised in
the statement of comprehensive income
Foreign currency reserve: Gains/losses arising on translation of
foreign controlled entities into pounds sterling.
The accompanying notes are an integral part of these financial
statements.
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2022
Share Share Share based Retained Total
capital premium payment losses
reserve
GBP GBP GBP GBP GBP
At 1 January 2021 2,829,566 564,173 1,006,238 (2,068,475) 2,331,502
Loss for the year - - - (1,485,506) (1,485,506)
--------- --------- ----------------- ----------- -----------
Comprehensive loss for the year - - - (1,485,506) (1,485,506)
Shares issued 771,538 814,388 - - 1,585,926
Lapsed warrants - - (69,037) 69,037 -
Exercise of options & warrants - - - - -
Cost of share issue - - - - -
Share warrant charge - - - - -
Share option charge - - 25,000 - 25,000
--------- --------- ----------------- ----------- -----------
At 31 December 2021 3,601,104 1,378,561 962,201 (3,484,944) 2,456,921
Loss for the year - - - (399,363) (399,363)
Comprehensive loss for the year - - - (399,363) (399,363)
Shares issued net of costs 1,551,391 640,289 (44,576) - 2,147,104
Warrants expired - 924,906 (924,906) - -
Share issuance costs - (207,735) - (207,735)
Issuance of warrants 58,626 (58,626) -
Share option charge - - 49,000 - 49,000
At 31 December 2022 5,152,495 2,794,647 (16,908) (3,884,307) 4,045,927
--------- --------- ----------------- ----------- -----------
The following describes the nature and purpose of each reserve
within equity:
Share capital: Nominal value of shares issued
Share premium: Amount subscribed for share capital in excess of
nominal value, less share issue costs
Share based payment reserve: Cumulative fair value of warrants and options granted
Retained losses: Cumulative net gains and losses, recognised in
the statement of comprehensive income
The accompanying notes are an integral part of these financial
statements.
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEARED 31 DECEMBER 2022
Notes 31 December 31 December
2022 2021
GBP GBP
Cash flows from operating activities
Loss before tax (509,138) (1,677,511)
Equity settled share based payments 49,000 45,000
Loss on derecognition of financial liability - 1,077,607
Depreciation 10 252 719
Foreign exchange 159,015 (78,137)
(Increase) / decrease in trade and other receivables 11 (13,493) 32,517
Decrease in trade and other payables 13 (34,254) (118,978)
Shares issued in lieu of cash - 33,251
Net cash used in operating activities (348,618) (685,532)
----------- -----------
Cash flows from investing activities
Payments for exploration and evaluation activities 9 (714,885) (516,886)
Net cash used in investing activities (714,885) (516,886)
----------- -----------
Cash flows from financing activities
Proceeds from the issue of shares 2,279,500 128,044
Payment for share issuance costs (207,735) -
Net cash generated from financing activities 2,071,765 128,044
----------- -----------
Net increase/(decrease) in cash and cash equivalents 1,008,262 (1,074,371)
Cash and cash equivalents at beginning of year 264,480 1,338,851
Cash and cash equivalents at end of year 12 1,272,742 264,480
=========== ===========
The accompanying notes are an integral part of these financial
statements
PARENT COMPANY CASH FLOW STATEMENT
FOR THE YEARED 31 DECEMBER 2022
Notes 31 December 31 December
2022 2021
GBP GBP
Cash flows from operating activities
Loss before tax (399,363) (1,485,505)
Equity settled share based payments 49,000 45,000
Loss on derecognition of financial liability - 1,077,607
Depreciation 10 252 719
Foreign exchange loss/gain - 3,110
Increase in trade and other receivables 11 (196,283) (9,897)
Decrease in trade and other payables 13 (20,087) (63,676)
Shares issued in lieu of cash - 33,251
Net cash used in operating activities (1,113,083) (399,391)
----------- -----------
Cash flows from investing activities
Loan to Subsidiary 11 - (362,729)
Net cash used in investing activities - (362,729)
----------- -----------
Cash flows from financing activities
Proceeds from the issue of shares 1,649,500 128,044
Proceeds of shares and warrants issued (207,735) -
Net cash generated from financing activities 1,441,765 128,044
----------- -----------
Net increase/(decrease) in cash and cash equivalents 875,284 (634,076)
Cash and cash equivalents at beginning of year 200,088 834,164
Cash and cash equivalents at end of year 12 1,075,372 200,088
=========== ===========
NOTES TO THE FINANCIAL STATEMENTS
1. ACCOUNTING POLICIES AND BASIS OF PREPARATION
General information
The Company is a public company limited by shares which is
incorporated in England. The registered office of the Company is
9(th) Floor, 107 Cheapside, London, EC2V 6DN, United Kingdom. The
registered number of the Company is 11170056.
The principal activity of the Group is to objective is to
explore, develop and mine precious and base metal projects .
Summary of significant accounting policies
The principal accounting policies applied in the preparation of
these Financial Statements are set out below ('Accounting Policies'
or 'Policies'). These Policies have been consistently applied to
all the periods presented, unless otherwise stated.
Accounting policies
Basis of preparation of Financial Statements
The Group and Company Financial Statements have been prepared in
accordance with UK-adopted international accounting standards. The
Group financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) and IFRS
Interpretations Committee (IFRS IC) interpretations as adopted by
the United Kingdom applicable to companies under IFRS. The Group
and Company Financial Statements have also been prepared under the
historical cost convention, except as modified for assets and
liabilities recognised at fair value on an asset acquisition.
The Financial Statements are presented in pounds sterling, which
is the functional currency of the Parent Company. The functional
currency of Lady Alice Mines Pty Ltd is Australian Dollars.
The preparation of the Financial Statements in conformity with
IFRS requires the use of certain critical accounting estimates. It
also requires the Board to exercise its judgement in the process of
applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the Financial
Statements are disclosed in Note 1.
Changes in accounting policies
i) New and amended standards adopted by the Group and Company
The International Accounting Standards Board (IASB) issued
various amendments and revisions to International Financial
Reporting Standards and IFRIC interpretations. The amendments and
revisions were applicable for the period ended 31 December 2022 but
did not result in any material changes to the financial statements
of the Group or Company.
Of the other IFRS and IFRIC amendments, none are expected to
have a material effect on the future Group or Company Financial
Statements.
ii) New standards, amendments and interpretations that are not
yet effective and have not been early adopted are as follows:
Standard Impact on initial application Effective
date
-------------------- ------------------------------------------- ----------
IAS 1 (Amendments) Presentation of Financial Statements: 1 January
Disclosure of Accounting Policies 2023
IAS 12 (Amendments) Income Taxes - Deferred Tax related 1 January
to Assets and Liabilities 2023
IAS 8 (Amendments) Accounting policies, changes in accounting 1 January
estimates and errors: Definition of 2023
Accounting Estimates
IAS 1 (Amendments) Presentation of Financial Statements: TBC
Classification of Liabilities as Current
or Non-Current
None are expected to have a material effect on the Group or
Company Financial Statements.
Going concern
The Financial Statements have been prepared on a going concern
basis. In assessing whether the going concern assumption is
appropriate, the Directors have taken into account all relevant
available information about the current and future position of the
Group and Company, including the current level of resources and the
required level of spending on exploration and evaluation
activities. As part of their assessment, the Directors have also
taken into account the ability to raise additional funding whilst
maintaining sufficient cash resources to meet all commitments.
The Group meets its working capital requirements from its cash
and cash equivalents. The Company is pre-revenue, and to date the
Company has raised finance for its activities through the issue of
equity and debt.
The Group has GBP1,252,742 of cash and cash equivalents at 31
December 2022. The Group's and Company's ability to meet
operational objectives and general overheads is reliant on raising
further capital in the near future.
The Directors are confident that further funds can be raised and
it is appropriate to prepare the financial statements on a going
concern basis, however there can be no certainty that any fundraise
will complete. These conditions indicate existence of a material
uncertainty related to events or conditions that may cast
significant doubt about the Group's and Company's ability to
continue as a going concern, and, therefore, that it may be unable
to realise its assets and discharge its liabilities in the normal
course of business. These financial statements do not include the
adjustments that would be required if the Group and Company could
not continue as a going concern.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Parent Company and companies controlled by the
Parent Company, the Subsidiary Companies, drawn up to 31 December
each year.
Control is recognised where the Company has the power to govern
the financial and operating policies of an investee entity so as to
obtain benefits from its activities, and is exposed to, or has
rights to, variable returns from its involvement in the subsidiary.
The results of subsidiaries acquired or disposed of during the year
are included in the consolidated income statement from the
effective date of acquisition or up to the effective date of
disposal, where appropriate.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used
into line with those used by the Group. All intra-group
transactions, balances, income and expenses are eliminated on
consolidation.
The Group applies the acquisition method of accounting to
account for business combinations. The consideration transferred
for the acquisition of a subsidiary is the fair values of the
assets transferred, the liabilities incurred to the former owners
of the acquiree and the equity interests issued by the Group. The
consideration transferred includes the fair value of any asset or
liability resulting from a contingent consideration arrangement.
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
initially at their fair values at the acquisition date.
Acquisition-related costs are expensed as incurred unless they
result from the issuance of shares, in which case they are offset
against the premium on those shares within equity.
Any contingent consideration to be transferred by the Group is
recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is
deemed to be an asset or liability is recognised either in profit
or loss or as a change to other comprehensive income. Contingent
consideration that is classified as equity is not re-measured, and
its subsequent settlement is accounted for within equity.
Investments in subsidiaries are accounted for at cost less
impairment.
Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board of Directors that makes
strategic decisions.
The Group's operations are located Australia with the head
office located in the United Kingdom. The main tangible assets of
the Group, cash and cash equivalents, are held in the United
Kingdom and Australia. The Board ensures that adequate amounts are
transferred internally to allow all companies to carry out their
operational on a timely basis.
The Directors are of the opinion that the Group is engaged in a
single segment of business being the exploration of gold in
Australia. The Group currently has two geographical reportable
segments - United Kingdom and Australia.
Foreign currencies
For the purposes of the consolidated financial statements, the
results and financial position of each Group entity are expressed
in pounds sterling, which is the presentation currency for the
consolidated financial statements.
In preparing the financial statements of the individual
entities, transactions in currencies other than the entity's
functional currency (foreign currencies) are recorded at the rates
of exchange prevailing at the dates of the transactions. At each
reporting date, monetary items denominated in foreign currencies
are retranslated at the rates prevailing at the reporting date.
Exchange differences arising are included in the profit or loss for
the period.
For the purposes of preparing consolidated financial statements,
the assets and liabilities of the Group's foreign operations are
translated at exchange rates prevailing on the reporting date.
Income and expense items are translated at the average exchange
rates for the period. Gains and losses from exchange differences so
arising are shown through the Consolidated Statement of Changes in
Equity.
Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated
depreciation and any accumulated impairment losses. Depreciation is
provided on all property, plant and equipment to write off the cost
less estimated residual value of each asset over its expected
useful economic life on a straight-line basis at the following
annual rates: Office Equipment: 33.33% per annum
The assets' residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period. An
asset's carrying amount is written down immediately to its
recoverable amount if the asset's carrying amount is greater than
its estimated recoverable amount. Gains and losses on disposal are
determined by comparing the proceeds with the carrying amount and
are recognised within 'Other (losses)/gains' in the Statement of
Comprehensive Income.
Impairment of tangible fixed assets
A review for indicators of impairment is carried out at each
reporting date, with the recoverable amount being estimated where
such indicators exist. Where the carrying value exceeds the
recoverable amount, the asset is impaired accordingly. Prior
impairments are also reviewed for possible reversal at each
reporting date.
For the purposes of impairment testing, when it is not possible
to estimate the recoverable amount of an individual asset, an
estimate is made of the recoverable amount of the cash-generating
unit to which the asset belongs. The cash-generating unit is the
smallest identifiable group of assets that includes the asset and
generates cash inflows that largely independent of the cash inflows
from other assets or groups of assets.
Exploration and evaluation assets
Exploration and evaluation assets comprises all costs which are
directly attributable to the exploration of a project area. The
Group recognises expenditure as exploration and evaluation assets
when it determines that those assets will be successful in finding
specific mineral resources. Expenditure included in the initial
measurement of exploration and evaluation assets and which are
classified as intangible assets relate to the acquisition of rights
to explore, topographical, geological, geochemical and geophysical
studies, exploratory drilling, trenching, sampling and activities
to evaluate the technical feasibility and commercial viability of
extracting a mineral resource. Capitalisation of pre-production
expenditure ceases when the mining property is capable of
commercial production.
Exploration and evaluation assets recorded at fair-value on
acquisition
Exploration assets which are acquired are recognised at fair
value. When an acquisition of an entity whose only significant
assets are its exploration asset and/or rights to explore, the
Directors consider that the fair value of the exploration assets is
equal to the consideration. Any excess of the consideration over
the capitalised exploration asset is attributed to the fair value
of the exploration asset.
Impairment of intangible assets
Intangible assets that have an indefinite useful life are not
subject to amortisation and are tested annually for impairment, or
more frequently if events or changes in circumstances indicate that
they might be impaired. Other assets are tested for impairment
whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. An impairment loss is
recognised in profit or loss for the amount by which the asset's
carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset's fair value less costs of
disposal and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there
are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of
assets (cash-generating units). Early stage exploration projects
are assessed for impairment using the methods specified in IFRS
6.
Financial Assets
Loans and Receivables
(a) Classification and receivables are non-derivative financial
assets with fixed or determinable payments that are not quoted in
an instrument level.
The Group's and Company's business model for managing financial
assets refers to how it manages its financial assets in order to
generate cash flows. The business model determines whether cash
flows will result from collecting contractual cash flows, selling
the financial assets, or both.
Subsequent measurement
For purposes of subsequent measurement, financial assets are
classified in four categories:
-- financial assets at amortised cost (debt instruments);
-- financial assets at fair value through OCI with recycling of
cumulative gains and losses (debt instruments);
-- financial assets designated at fair value through OCI with no
recycling of cumulative gains and losses upon derecognition (equity
instruments); and
-- financial assets at fair value through profit or loss.
Financial assets at amortised cost (debt instruments)
This category is the most relevant to the Group and Company. The
Group and Company measure financial assets at amortised cost if
both of the following conditions are met:
-- the financial asset is held within a business model with the
objective to hold financial assets in order to collect contractual
cash flows; and
-- the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
Financial assets at amortised cost are subsequently measured
using the effective interest rate ("EIR") method and are subject to
impairment. Interest received is recognised as part of finance
income in the statement of profit or loss and other comprehensive
income. Gains and losses are recognised in profit or loss when the
asset is derecognised, modified or impaired. The Group's and
Company's financial assets at amortised cost include trade and
other receivables (not subject to provisional pricing) and cash and
cash equivalents.
Derecognition
A financial asset is primarily derecognised when:
-- the rights to receive cash flows from the asset have expired; or
-- the Group and Company have transferred their rights to
receive cash flows from the asset or has assumed an obligation to
pay the received cash flows in full without material delay to a
third party under a 'pass-through' arrangement; and either (a) the
Group and Company have transferred substantially all the risks and
rewards of the asset, or (b) the Group and Company have neither
transferred nor retained substantially all the risks and rewards of
the asset, but has transferred control of the asset.
Impairment of financial assets
The Group and Company recognise an allowance for expected credit
losses ("ECLs") for all debt instruments not held at fair value
through profit or loss. ECLs are based on the difference between
the contractual cash flows due in accordance with the contract and
all the cash flows that the Group and Company expect to receive,
discounted at an approximation of the original EIR. The expected
cash flows will include cash flows from the sale of collateral held
or other credit enhancements that are integral to the contractual
terms.
Financial liabilities
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss, loans
and borrowings, payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate. All financial
liabilities are recognised initially at fair value and, in the case
of loans and borrowings and payables, net of directly attributable
transaction costs.
Subsequent measurement
After initial recognition, trade and other payables are
subsequently measured at amortised cost using the EIR method. Gains
and losses are recognised in the statement of profit or loss and
other comprehensive income when the liabilities are derecognised,
as well as through the EIR amortisation process.
Derecognition
A financial liability is derecognised when the associated
obligation is discharged or cancelled or expires.
Cash and cash equivalents
The Company considers any cash on short-term deposits and other
short-term investments to be cash and cash equivalents.
Share capital
The Company's Ordinary shares of nominal value GBP0.01 each
("Ordinary Shares") are recorded at such nominal value and proceeds
received in excess of the nominal value of Ordinary Shares issued,
if any, are accounted for as share premium. Both share capital and
share premium are classified as equity. Costs incurred directly to
the issue of Ordinary Shares are accounted for as a deduction from
share premium, otherwise they are charged to the income
statement.
Current and deferred income tax
Tax represents income tax and deferred tax. Income tax is based
on profit or loss for the year. Taxable profit or loss differs from
the loss for the year as reported in the Consolidated Statement of
Comprehensive Income because it excludes items of income or expense
that are taxable or deductible in other years and it further
excludes items of income or expense that are never taxable or
deductible. The liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the
Statement of Financial Position date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the Historical Financial Information and the corresponding tax
bases used in the computation of taxable profit, and is accounted
for using the liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which
deductible temporary differences can be utilised.
Deferred tax assets and liabilities are offset where there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the intention is to settle
current tax assets and liabilities on a net basis.
Share based payments
The fair value of services received in exchange for the grant of
share warrants is recognised as an expense in share premium or
profit or loss, in accordance with thenature of the service
provided. A corresponding increase is recognised in equity.
Judgements and key sources of estimation uncertainty
The preparation of the Financial Statements in conformity with
IFRS requires the directors to make judgements, estimates and
assumptions that affect the amounts reported. These estimates and
judgements are continually reviewed and are based on experience and
other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
Accounting estimates and assumptions are made concerning the
future and, by their nature, may not accurately reflect the related
actual outcome. Share options and warrants are measured at fair
value at the date of grant. The fair value is calculated using the
Black Scholes method for both options and warrants as the
management views the Black Scholes method as providing the most
reliable measure of valuation.
Contingent consideration, resulting from business combinations,
is valued at fair value at the acquisition date as part of the
business combination. The determination of fair value is based on
key assumptions involving estimation of the probability of meeting
each performance target and the timing thereof. As part of the
acquisition of Lady Alice Mines Pty Ltd, contingent consideration
with an estimated fair value of GBP296,536 was recognised at the
acquisition date. See note 18 for further details. The Group is
required to remeasure the contingent liability at fair value at
each reporting date with changes in fair value recognised in
accordance with IFRS 9. Therefore, as at 31 December 2022, the
contingent consideration reflects an estimated fair value of
GBP148,914.
2. EXPENSES BY NATURE
31 December 31 December
2022 2021
GBP GBP
Administrative expense 79,905 73,819
Corporate expense and Finance 169,813 191,230
Professional fees 960 960
Wages & Salaries expense 237,927 301,204
488,605 567,213
============= ===========
3. FINANCE COSTS
31 December 31 December
2022 2021
GBP GBP
Loss on settlement of settlement of financial
liability - 1,077,607
Other finance costs 20,530 32,691
20,530 1,110,298
============= ===========
4. SEGMENT INFORMATION
The Group's prime business segment is mineral exploration.
The Group operates within two geographical segments, the United
Kingdom and Australia. The UK sector consists of the parent company
which provides administrative and management services to the
subsidiary undertaking based in Australia.
The following tables present expenditure and certain asset
information regarding the Group's geographical segments for the
years ended 31 December 2022 and 2021:
Operational Results 31 December 31 December
2022 2021
GBP GBP
--------------------- ------------ ------------
Revenue - -
--------------------- ------------ ------------
Loss after taxation
- United Kingdom (399,363) (1,485,507)
- Australia (109,776) (192,004)
---------------------- ------------ ------------
Total (509,139) (1,677,511)
---------------------- ------------ ------------
2022 Australia United Kingdom Total
GBP GBP GBP
-------------------- ---------- --------------- ----------
Non-current assets 2,261,779 466,939 2,728,718
Current assets 242,603 3,739,773 3,982,376
Total liabilities (34,131) (160,787) (194,918)
2021 Australia United Kingdom Total
GBP GBP GBP
-------------------- ---------- --------------- ----------
Non-current assets 1,546,895 467,190 2,014,085
Current assets 92,244 209,127 301,371
Total liabilities (18,376) (219,460) (237,836)
5. DIRECTORS' EMOLUMENTS
There were no employees during the period apart from the
directors, who are the key management personnel. No directors had
benefits accruing under money purchase pension schemes.
Share
Year ended 31 December Remuneration Fees Bonus Based payment Total
2022 GBP GBP GBP GBP GBP
----------------------- ------------ ------- ----- --------------- -------
G Hancock - 36,361 - 8,143 44,504
R Verco 131,516 - - - 131,516
D Maling - 24,000 - 7,714 31,714
D Clarke - 24,000 - 8,143 32,143
----------------------- ------------ ------- ----- --------------- -------
131,516 84,361 - 24,000 239,877
----------------------- ------------ ------- ----- --------------- -------
-- During the year GBP36,361 (2021: 38,422) was paid to Hancock
Corporate Investments Pty Ltd, a company in which Greg Hancock is a
Director, in respect of Directors fees and consultancy
services.
-- During the year GBP24,000 (2021: GBP24,227) was paid to Dan
Maling, in respect of Directors fees.
-- During the year GBP24,000 (2020: GBP31,066) was paid to The
Springton Trust & Queens Road Mines, in which David Clarke is a
Trustee, in respect of Directors fees and consultancy services.
Share
Year ended 31 December Remuneration Fees Bonus Based payment Total
2021 GBP GBP GBP GBP GBP
----------------------- ------------ ------- ----- --------------- -------
C Moulton 92,178 - - 20,000 112,178
G Hancock - 38,422 - 8,143 46,565
D Maling - 24,227 - 8,714 32,941
D Clarke - 31,066 - 8,143 39,209
----------------------- ------------ ------- ----- --------------- -------
92,178 93,715 - 45,000 230,893
----------------------- ------------ ------- ----- --------------- -------
-- During the year GBP112,178 (2020: GBP179,727) was paid to
Craig Moulton in respect of Wages & Salaries and Share based
payments. The share based payments include GBP20,000 for 1,333,333
shares per his employment contract.
-- During the year GBP38,422 (2020: GBP22,167) was paid to
Hancock Corporate Investments Pty Ltd, a company in which Greg
Hancock is a Director, in respect of Directors fees and consultancy
services.
-- During the year GBP24,227 (2020: GBP13,584) was paid to Dan
Maling, in respect of Directors fees.
-- During the year GBP31,066 (2020: GBP13,667) was paid to The
Springton Trust & Queens Road Mines, in which David Clarke is a
Trustee, in respect of Directors fees and consultancy services.
6. INCOME TAXES
a) Analysis of tax in the period
31 December 31 December
2022 2021
GBP GBP
Current tax - -
Deferred taxation - -
- -
========= ============
b) Factors affecting tax charge or credit for the period
The tax assessed on the loss on ordinary activities for the
period differs from the standard rate of corporation tax in the UK
of 19% (2021: 19%) and Australia of 25% (2021: 26%). The
differences are explained below:
31 December 31 December
2022 2021
GBP GBP
Loss on ordinary activities before tax (509,138) (1,677,511)
=========== ===========
Loss multiplied by weighted average applicable
rate of tax (112,010) (332,167)
Effects of:
Expenses not deductible for tax - 225,471
Losses carried forward not recognised as deferred
tax assets 112,010 106,696
- -
=========== ===========
The weighted average applicable tax rate of 22% (2021: 19.8%)
used is a combination of the standard rate of corporation tax rate
for entities in the United Kingdom of 19% (2021: 19%), and 25%
(2021: 25%) in Australia.
7. EARNINGS PER SHARE
Basic and diluted loss per share is calculated by dividing the
loss attributed to ordinary shareholders of GBP509,138 (2021:
GBP1,677,511 loss) by the weighted average number of shares of
515,249,550 (2021: 360,110,510 ) in issue during the year.
The basic and dilutive loss per share are the same as the effect
of the exercise of share warrants and options would be
anti-dilutive.
8. INVESTMENTS IN SUBSIDIARY UNDERTAKINGS
Investments Loans Total
Company GBP GBP GBP
At 1 January 2022 432,260 - 432,260
At 31 December 2022 432,260 - 432,260
----------- ----- -------
Investments in Group undertakings are stated at cost less
impairment. In 2019 the Company acquired 100% of the issued share
capital of Lady Alice Mines Pty Ltd and in turn, 100% of the units
in the Lady Alice Trust which is wholly owned by Lady Alice Mines
Pty Ltd.
At 31 December 2021 the Company held the following interests in
subsidiary undertakings, which are included in the consolidated
financial statements and are unlisted.
Proportion
Name of company Registered office address held Business
Level 2, 40 Kings Park
Road, West Perth, WA,
Lady Alice Mines Pty Ltd Australia 100% Mining
Level 2, 40 Kings Park
Road, West Perth, WA,
Lady Alice Mines Unit Trust(1) Australia 100% Mining
(1) Lady Alice Mines Unite Trust is a wholly owned entity of
Lady Alice Mines Pty Ltd.
9. INTANGIBLE FIXED ASSETS
Intangible assets comprise exploration and evaluation costs.
Exploration and evaluation assets are all internally generated
except for those acquired at fair value as part of a business
combination.
Total
Group GBP
At 1 January 2021 1,495,519
Additions 516,886
At 1 January 2022 2,012,405
Additions 714,885
At 31 December 2022 2,727,290
----------
Total
Company GBP
At 1 January 2021 33,251
Additions -
-------
At 1 January 2022 33,251
Additions -
At 31 December 2022 33,251
-------
The Directors undertook an assessment of the following areas and
circumstances that could indicate the existence of impairment:
-- The Group's right to explore in an area has expired, or will
expire in the near future without renewal;
-- No further exploration or evaluation is planned or budgeted
for;
-- A decision has been taken by the Board to discontinue
exploration and evaluation in an area due to the absence of a
commercial level of reserves; or
-- Sufficient data exists to indicate that the book value will
not be fully recovered from future development and production.
Following their assessment, the Directors concluded that no
impairment charge was necessary for the year ended 31 December
2022.
10. PROPERTY, PLANT AND EQUIPMENT - Group
and Company
Office Equipment Total
2022
Cost GBP GBP
At 31 December 2021 4,407 4,407
Additions during the year - -
At 31 December 2022 4,407 4,407
Depreciation
At 31 December 2021 (2,727) (2,727)
Charge for the year (252) (252)
At 31 December 2022 (2,979) (2,979)
Net book value
----------------- --------
At 31 December 2022 1,428 1,428
----------------- --------
Office Equipment Total
2021
Cost GBP GBP
At 31 December 2020 4,407 4,407
Additions during the year - -
At 31 December 2021 4,407 4,407
Depreciation
At 31 December 2021 (2,727) (2,727)
Charge for the year (252) (252)
At 31 December 2022 (2,979) (2,979)
Net book value
----------------- --------
At 31 December 2022 1,428 1,428
----------------- --------
11 . TRADE AND OTHER RECEIVABLES
Group Group Company Company
31 Dec 31 Dec 31 Dec 31 Dec
2022 2021 2022 2021
Current GBP GBP GBP GBP
Prepayments 45,211 - - -
Intercompany debtors - - 2,659,160 2,000,064
Goods & Services Tax 33,995 27,852 - -
Other debtors 5,263 9,039 5,240 9,039
------- ------- --------- -----------
84,469 36,891 2,664,400 2,009,103
======= ======= ========= ===========
The fair value of trade and other receivables approximates to
their book value. Other classes of financial assets included within
trade and other receivables do not contain impaired assets.
The carrying amounts of the Group and Company's trade and other
receivables are denominated in the following currencies:
Group Group Company
31 Dec 31 Dec Company 31 Dec
2022 2021 31 Dec 2022 2021
GBP GBP GBP GBP
UK pounds 5,240 9,039 2,664,401 2,009,103
Australian dollars 79,229 27,852 - -
----------- ----------- ------------- ---------
84,469 36,891 2,664,401 2,009,103
=========== =========== ============= =========
12. CASH AND CASH EQUIVALENTS
Group Group
31 Dec 31 Dec Company Company
2022 2021 31 Dec 2022 31 Dec 2021
GBP GBP GBP GBP
Cash at bank and in hand 1,272,742 264,480 1,075,372 200,088
1,272,742 264,480 1,075,372 200,088
========= ======= ============= =================
The fair value of cash at bank is the same as its carrying
value.
The carrying amounts of the Group and Company's cash and cash
equivalents are denominated in the following currencies:
Group Group Company
31 Dec 31 Dec Company 31 Dec
2022 2021 31 Dec 2022 2021
GBP GBP GBP GBP
UK pounds 1,075,373 200,088 1,075,372 200,088
Australian dollars 197,370 64,392 - -
--------- ------- ------------- -------
1,272,743 264,480 1,075,372 200,088
========= ======= ============= =======
13. TRADE AND OTHER PAYABLES
Group Group Company
31 Dec 31 Dec Company 31 Dec
2022 2021 31 Dec 2022 2021
Current GBP GBP GBP GBP
Trade creditors 81,536 20,642 18,124 9,360
Accruals and deferred income 1,249 22,600 1,249 22,600
Other payables (2,786) 7,094 (7,500) -
------- ------- ------------- -------
79,999 50,336 11,873 31,960
======= ======= ============= =======
The fair value of trade and other payables approximates to their
book value.
The carrying amounts of the Group and Company's trade and other
payables are denominated in the following currencies:
Group Group Company
31 Dec 31 Dec Company 31 Dec
2022 2021 31 Dec 2022 2021
GBP GBP GBP GBP
UK pounds 38,073 31,960 11,873 31,960
Australian dollars 41,926 18,376 - -
--------- ----------- ------------- -------
79,999 50,336 11,873 31,960
========= =========== ============= =======
14. CONTINGENT CONSIDERATION
2021 Total
Group and Company GBP
Amounts payable
under business
combination
At 31 December
2021 187,500
-------
Categorised as:
-------
Current liabilities 187,500
Non-current liabilities -
-------
Refer to note 18 for further detail.
2022 Total
Group and Company GBP
Amounts payable under
business combination 187,500
Less payment 38,586
At 31 December 2022 148,914
-------
Categorised as:
-------
Current liabilities 148,914
Non-current liabilities -
-------
15. SHARE CAPITAL
Dec 2022 Dec 2022 Dec 2021 Dec 2021
Number Number
of shares GBP of shares GBP
Issued, called up and fully
paid
Ordinary shares of GBP0.01
As at the start of the year 360,110,510 3,601,104 282,956,585 2,829,566
Issued in the year 155,139,040 1,551,391 77,153,925 771,538
----------- --------- ----------- ---------
Total 515,249,550 5,152,495 360,110,510 3,601,104
=========== ========= =========== =========
On 16 February 2022, 63,000,000 Ordinary shares were issued
pursuant to a private placement at 1.5 pence each.
On 26 October 2022, 88,966,668 Ordinary shares were issued
pursuant to a private placement at 1.5 pence each, 2,572,372
Ordinary shares were issued to former LAM owners at 1.5p each, and
600,000 Ordinary shares were issued to third party suppliers for
settlement of fees in lieu of cash.
As at 31 December 2022 the Company had 49,613,334 warrants
outstanding (2020: 67,543,461).
Each Ordinary share is entitled to one vote in any
circumstances. Each Ordinary share is entitled pari passu to
dividend payments or any other distribution and to participate in a
distribution arising from a winding up of the Company.
16. SHARE BASED PAYMENTS
2022
Warrants
Weighted
average
Warrants exercise
Number price
Warrants at 31 December
2021 67,543,461 0.03p
Granted during year 49,613,334 0.03p
Exercised during year - -
Lapsed during year (67,543,461) 0.03p
------------------------------- ----------
Warrants at 31 December
2022 49,613,334 0.03p
=============================== ==========
Exercisable at year
end 49,613,334 0.03p
=============================== ==========
At 31 December 2022 the weighted average remaining contractual
life of the warrants outstanding was 2.78 years.
2021
Warrants
Weighted
average
Warrants exercise
Number price
Warrants at 31 December
2020 127,796,891 0.02p
Granted during year - -
Exercised during year (5,934,801) 0.02p
Lapsed during year (54,318,629) 0.02p
Warrants at 31 December
2021 67,543,461 0.03p
=============================== ==========
Exercisable at year
end 67,543,461 0.03p
=============================== ==========
At 31 December 2021 the weighted average remaining contractual
life of the warrants outstanding was 0.82 years.
2022
Options
Weighted
average
exercise
Options Number price
Options at 31 December
2021 15,672,336 0.033p
=============== ==========
Issued during the period - -
Exercised during the
year - -
Options at 31 December
2022 15,672,336 0.033p
=============== ==========
Exercisable at year
end 672,336 0.015p
=============== ==========
At 31 December 2022 the weighted average remaining contractual
life of the options outstanding was 2.43 years.
2021
Options
Weighted
average
exercise
Options Number price
Options at 31 December
2020 15,672,336 0.033p
=============== ==========
Issued during the period - -
Exercised during the
year - -
Options at 31 December
2021 15,672,336 0.033p
=============== ==========
Exercisable at year
end 672,336 0.015p
=============== ==========
At 31 December 2021 the weighted average remaining contractual
life of the options outstanding was 3.43 years.
The fair value of equity settled share options and warrants
granted is estimated at the date of grant using a Black-Scholes
option pricing model, taking into account the terms and conditions
upon which the options were granted. The following table lists the
inputs to the model:
Options Warrants Warrants
--------------------- ---------------- --------------- --------------
Date of grant 14 July 2020 16 February 26 October
2022 2022
Expected volatility 94.59% 104.98% 96.35%
Expected life 5 3 3
Risk-free interest 0.10% 1.29% 3.36%
rate
Expected dividend 0.00% 0.00% 0.00%
yield
Fair value per
option/warrant
GBP0.008 GBP0.013 GBP0.009
--------------------- ---------------- --------------- --------------
17. FINANCIAL INSTRUMENTS
Group Group Company Company
31 Dec 2022 31 Dec 2021 31 Dec 2022 31 Dec 2021
GBP GBP GBP GBP
Financial assets at amortised cost
Trade and other receivables excluding prepayments 50,474 36,891 2,664,401 2,009,103
Cash and cash equivalents 1,272,742 264,480 1,075,373 200,088
1,323,216 301,371 3,739,774 2,209,191
============ ============ ============ ============
Financial liabilities
Trade and other payables (at amortised cost) (46,004) (27,736) (11,873) (9,360)
Deferred consideration (at FVPL) (148,914) (187,500) (148,914) (187,500)
(194,918) (215,236) (160,787) (196,860)
============ ============ ============ ============
18. BUSINESS COMBINATION
Lady Alice Mines Pty Ltd
On 7 March 2019, the Company acquired 100% of the share capital
of Lady Alice Mines Pty Ltd ('LAM') and its wholly owned subsidiary
The Lady Alice Trust (the 'Trust'), for total consideration of
GBP432,260 which is to be satisfied via a mix of cash and share
consideration which is shown below. In addition, the Company agreed
to settle existing liabilities due to unitholders of the Trust of
up to A$250,000. The share based payment consideration was settled
on 16 January 2020 upon the successful re-admission to the London's
Stock Exchange Main Market. 10,815,297 shares were issued at a
close price of 1.25p.
The Trust has an entitlement to earn a 75% equity interest in
tenements near Wudinna in South Australia for gold exploration (the
'Wudinna Agreement'), and is also the sole owner of the right,
title and interest in the Prince Alfred Licence, a formerly
producing copper mine.
The principal terms of the Wudinna Agreement are as follows:
-- Stage 1: the Trust will fund A$2.1 million within three years to earn a 50% equity position
-- Stage 2: at the completion of Stage 1, a joint venture
vehicle can be formed, or alternatively the Trust can spend a
further A$1.65 million over an additional two years to earn a 65%
equity interest
-- Stage 3: at the completion of Stage 2, a joint venture
vehicle can be formed, or alternatively the Trust can spend a
further A$1.25 million within one year to earn a 75% equity
interest
The contingent consideration is due to the unitholders on
satisfying the following project milestones:
-- First Option - 14% of the total issued share capital on completion of Stage 1
-- Second Option - 21% of the total issued share capital on completion of Stage 2
-- Third Option - 30,000,000 ordinary shares on announcement of
a JORC-compliant Indicated Mineral Resource for the Wudinna Project
of not less than 750,000 ounces of gold
The Directors have calculated the consideration payable on a
probability basis of satisfying the project milestones in
accordance with IFRS 3 Business Combinations. The Directors have
also estimated the number of shares to be issued at each milestone
and the share price. This has been fixed at the number of
consideration shares issued at the time of the RTO and the share
price at that time. Management believe this is a best estimate.
19. RELATED PARTY TRANSACTIONS
Save as disclosed below there were no related party transactions
during the year other than remuneration to Directors disclosed in
note 5.
During the year, the Group paid GBP9,000 in advisor fees to
Orana Corporate LLP, an entity in which Daniel Maling is a
Partner.
During the year, the Group paid GBP131,516 to Rupert Verco,
Chief Executive Officer of the Company Mr Verco was appointed as
CEO with effect from 12 July 2021.
As at 31 December 2022 included in the other receivables is
GBP2,659,160 due from Lady Alice Mines Pty Ltd, a subsidiary
company. The loan is interest free and repayable on demand.
20. FINANCIAL RISK MANAGEMENT
20.1 Financial risk factors
The Group's activities expose it to a variety of financial
risks: market risk, credit risk and liquidity risk. The Group's
overall risk management programme focuses on the unpredictability
of financial markets and seeks to minimise potential adverse
effects on the Group's financial performance.
Risk management is carried out by executive management.
a) Market risk
The Group is exposed to market risk, primarily relating to
foreign exchange and commodity prices. The Group does not hedge
against market risks as the exposure is not deemed sufficient to
enter into forward contracts. The Company has not sensitised the
figures for fluctuations in foreign exchange or commodity prices as
the Directors are of the opinion that these fluctuations would not
have a significant impact on the Financial Statements at the
present time. The Directors will continue to assess the effect of
movements in market risks on the Group's financial operations and
initiate suitable risk management measures where necessary.
b) Credit risk
Credit risk arises from cash and cash equivalents as well as
outstanding receivables. To manage this risk, the Group
periodically assesses the financial reliability of customers and
counterparties.
The amount of exposure to any individual counter party is
subject to a limit, which is assessed by the Board.
The Group considers the credit ratings of banks in which it
holds funds in order to reduce exposure to credit risk. The Company
will only keep its holdings of cash with institutions which have a
minimum credit rating of 'A'.
c) Liquidity risk
The Company's continued future operations depend on the ability
to raise sufficient working capital through the issue of equity
share capital or debt. The Directors are reasonably confident that
adequate funding will be forthcoming with which to finance
operations. Controls over expenditure are carefully managed.
The following table summarizes the Group's significant remaining
contractual maturities for financial liabilities at 31 December
2022.
Contractual maturity analysis as at 31 December 2022
2022 2021
Less than 12 Less than 12
Months 1 - 5 Months 1 - 5
GBP Year Total GBP Year Total
GBP GBP GBP GBP
--------------------------- --------------- -------- -------- ------------------ ----------- --------------
Accounts payable 81,536 - 81,536 20,642 - 20,642
Accrued liabilities 1,249 - 1,249 22,600 - 22,600
82,785 - 82,785 43,242 - 43,242
--------------------------- --------------- -------- -------- ------------------ ----------- --------------
20.2 Capital risk management
The Group's objectives when managing capital are to safeguard
the Group's ability to continue as a going concern, in order to
enable the Group to continue to explore, develop and mine precious
and base metal projects. In order to maintain or adjust the capital
structure, the Group may adjust the issue of shares or sell assets
to reduce debts.
The Group defines capital based on the total equity and reserves
of the Group. The Group monitors its level of cash resources
available against future planned operational activities and may
issue new shares in order to raise further funds from time to
time.
21. CAPITAL COMMITMENTS & CONTINGENT LIABILITIES
As at 31 December 2022 the Group had GBP69,396 of capital
commitments in relation to operating activities at the Wudinna Gold
Project.
There were no changes to contingent liabilities as at 31
December 2022.
22. POST YEAR END EVENTS
On the 9 January 2023 the Company announced a maiden JORC
compliant rare earth resource estimate at the Clarke and Baggy
Green Gold prospects of 20.9Mt at 658ppm TREO.
On the 1 February 2023, the Company provided access to Andromeda
Metals for an independent audit of its project expenditure in
relation to confirmation of achieving the Stage 3 expenditure
milestone of the Wudinna Heads of Agreement. Audit findings
subsequently confirmed the Group's expenditure, and acknowledged
the Group's 75% ownership.
23. ULTIMATE CONTROLLING PARTY
There is no ultimate controlling party.
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