TIDMCRTM
RNS Number : 2618S
Critical Metals PLC
03 November 2023
Critical Metals plc / EPIC: CRTM / Market: Main Market
3 November 2023
Critical Metals plc
("Critical Metals" or the "Company")
Final Results
Critical Metals plc, a mining company established to acquire
mining opportunities in the critical and strategic metals sector,
currently developing an ex-producing copper cobalt mine in the
Democratic Republic of Congo ("DRC"), is pleased to announce its
Final Results for the year ended 30 June 2023.
A copy of this announcement and the Annual Report for the year
ended 30 June 2023 will be made available on the Company's website
at www.criticalmetals.co.uk .
Highlights
-- Readmitted to the Main Market of the London Stock Exchange in September 2022
-- Increased indirect ownership of the Molulu project from 40%
to 70%, streamlining the corporate structure.
-- Raised GBP600,000 at a price of 25p per share and raised a
further GBP1.3 million at 25p per share from existing
shareholders.
-- Built a strong onsite team of experienced mining
professionals with the appointment of a mine manager and DRC field
manager. Undertook a range of activities at Molulu including road
rehabilitation and the construction of bridge.
-- Commenced copper ore pre-production at Molulu in January 2023.
-- Post period, the Company announced a US$3 million
non-dilutive debt facility with a major international financial
institution. Also post period, the Company announced the rental and
proposed acquisition of 100% of the Kastro plant assets for the
processing of Molulu ore into copper cathode and cobalt
hydroxide.
-- In October 2023, the Company announced that it had entered
into an off-take agreement with O.M Metal & Resources S.A.R.L,
for a minimum of 20,000 tonnes of copper oxide ore.
For further information contact:
Critical Metals plc
Russell Fryer, CEO Tel: +44 (0)20 7236 1177
Peterhouse Capital Limited Tel: +44 (0)20 7469 0936 / +44
- Corporate Broker (0)20 7220 9797
Lucy William / Charles Goodfellow
--------------------------------
St Brides Partners Ltd
Financial PR
Catherine Leftley /Ana Ribeiro/Isabelle Tel: +44 (0)20 7236 1177
Morris
--------------------------------
Dear Shareholder,
I am pleased to present the consolidated financial statements
for Critical Metals plc (the "Group" or "Critical Metals") for the
year ended 30 June 2023. During the year under review, the Group
has been transformed from an explorer into the next copper producer
in the Democratic Republic of Congo ("DRC").
Since our readmission in September 2022 with no employees in the
DRC, your Board has worked tirelessly to create value for all
shareholders. As of the end of our financial year, your Group
employed fifty-one (51) (on a contractual basis) in the DRC, of
which forty-nine (49) are DRC citizens.
During the mining build up, we simplified the Group's corporate
structure and increased our indirect holding in the exciting Molulu
Project from 40% to 70%, providing shareholders with a greater
percentage of any future cashflows. Copper ore pre-production began
in January 2023 with the goal of producing 10,000 tonnes per month
of oxide ore. Seasonal rains highlighted areas where more
groundwork was needed to achieve this goal, such as road
rehabilitation and the requirement to build a robust bridge across
the river.
The period from January to May 2023 allowed your Group to
undertake detailed geophysics studies and ground surveys to better
understand the Molulu lease property. On 15 May 2023, the Group
announced its decision to focus on the much higher-grade sulphide
copper ore, which has the potential to increase profitability by
orders of magnitude above mining the oxide zone only, following the
discovery of an 8.3% copper sulphide ore sample.
Also in May 2023, the Group's management decided to use the
existing hired dozer and excavator that were located at Molulu to
rehabilitate the road that connects the property to several ore
buyers' processing plants. This decision saved shareholders over
US$50,000 in external contractor costs. The dozer has rehabilitated
the entire road and the bridge to allow large tipper trucks to use
the road to supply ore to the selected buyers has been constructed
enabling the use of 40-50 tonne tipper trucks. The decision to use
40-50 tonne trucks instead of 25 tonne trucks was driven by the
ability of delivering larger volumes of copper ore more
efficiently, thereby reducing the wear on both the bridge and road,
while reducing variable unit costs.
As a Board, we were fully aware of the potential for the Molulu
project to become a significant copper producer in the DRC. The
Molulu project met all our investment criteria, including the
potential of generating early cash flow for shareholders.
As your Board is focused on cash flows to protect shareholders,
subsequent to year end, a copper ore offtake agreement was executed
and after seven (7) potential buyers had expressed interest in
purchasing the Molulu copper ore. First ore has already been
delivered to the Buyer's plant and deliveries will continue for the
remainder of 2023.
The intention of adding a copper/cobalt processing facility had
been well signalled to market for approximately one year. Post year
end, a transaction has been announced to rent with the option to
purchase a previously operating copper cathode/cobalt hydroxide
processing plant that is on care-and-maintenance. This transaction
will allow our Group to capture greater margins from the Molulu
ore.
Environmental, Social and Governance ("ESG") Programme
The Group continues to support the local community at Molulu.
Through our operations we have established a small but thriving
economy at Molulu. I am proud of the support we offer the Molulu
community, including buying much of the food consumed at the camp
from local people, as well as providing Molulu workers with a
competitive wage. Molulu continues to have the support of the local
communities, and the board is committed to further developing this
relationship for the better of all parties involved.
Funding
In May 2023, the company announced that it had raised GBP600,000
at 25p per share, a 4.2% premium to the closing price on 30 May
2023. Participants in the placing included well known global mining
investment bankers and five other long-term shareholders. The Group
went on to raise a further GBP1.3 million at 25p per share through
the continued support of shareholders. Additionally, post period,
the Group announced that it had signed a US$3 million non-dilutive
debt facility with an international financial institution. These
funds will be used to meet the Group's aims of increasing
production at the Molulu Project, as well as funding any necessary
due diligence on possible acquisitions by the Group in the
future.
Appointments
In the last year, we have worked to build our team on the
ground. The appointment of Lloyd Kirtley as DRC field Manager, and
Mine Manager John Greeff are valuable additions to the team. Last
year, Lloyd and John, supported by the wider team, were pivotal in
ensuring that access to the ore body was achieved as soon as
reasonably possible. On 31 May, the Group announced that it had
hired an additional geologist, to support the team as they work to
further refine the understanding of the ore body.
The team on the ground have been working to increase production
from the original forecast of 10,000 tonnes of copper oxide per
month. Preparations for sales from Molulu, specifically the
development of infrastructure including the road rehabilitation and
the construction of the bridge, to support the weight of larger
trucks, making the Molulu site more accessible.
Outlook
Looking forward to the coming year, I am greatly encouraged by
the work we have done. The Group will continue to optimise
operations to increase the overall production of Molulu whilst
advancing the growth goals of the Group. We will also work with our
geologists to produce a JORC compliant mineral assessment of
Molulu, which we will announce to the market as soon as available.
I remain confident in the economic viability of Molulu, driven by
strong fundamentals and increased demand for copper. In line with
the Group's strategy, we will continue to assess further
acquisition opportunities when they arise whilst expanding
operations at Molulu. I look forward to the next twelve months with
extreme optimism and thank my fellow Board members Anthony Eastman
and Marcus Edwards-Jones for their input, wisdom, and friendship
during this exciting journey.
Russell S. Fryer
Executive Chairman & CEO - 2 November 2023
CRITICAL METALS PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEARED 30 JUNE 2023
Year ended 30 Year ended
Notes June 2023 30 June 2022
GBP GBP
Revenue
Revenue from continuing operations - -
-------------- --------------
- -
Expenditure
Exploration & evaluation expenditure (139,274) -
Costs associated with the listing 4 - (202,594)
Administrative expenses 4 (2,491,522) (461,264)
Depreciation 10 (30,251) -
-------------- --------------
(2,661,047) (663,858)
Finance costs
Finance income/(expenses) - 2,115
Interest expense 18 (39,179) -
-------------- --------------
(39,179) 2,115
Loss on ordinary activities before
taxation (2,700,226) (661,743)
Taxation on loss on ordinary activities 8 - -
-------------- --------------
Loss on ordinary activities after
taxation (2,700,226) (661,743)
-------------- --------------
Other comprehensive income
-------------- --------------
Exchange differences on translation
of foreign operations 5 43,490 -
-------------- --------------
Loss and total comprehensive income
for the year attributable to the
owners of the Group (2,656,736) (661,743)
-------------- --------------
Earnings per share (basic and diluted)
attributable to the equity holders
(pence) 9 (4.95) (1.59)
Loss attributable to:
Owners of the parent (2,485,974) (661,473)
Non-controlling interest (214,252) -
-------------- --------------
(2,700,226) (661,743)
-------------- --------------
The Company has taken advantage of section 408 of the Companies
Act 2006 and consequently a profit and loss account has not been
presented for the Company. The Company's loss for the financial
period was GBP1,758,868 (2022 : GBP661,743).
The accompanying notes on pages 42 to 69 form an integral part
of these consolidated financial statements.
CRITICAL METALS PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
Notes As at As at
30 June 2023 30 June 2022
GBP GBP
-------------------------------- ------ -------------- --------------
NON-CURRENT ASSETS
Loan notes 12 - 39,827
Property, plant & equipment 10,11 4,007,454 -
TOTAL NON-CURRENT ASSETS 4,007,454 39,827
-------------- --------------
CURRENT ASSETS
Trade and other receivables 13 266,272 55,409
Cash at bank and in hand 15 411,696 824,251
-------------- --------------
TOTAL CURRENT ASSETS 677,968 879,660
-------------- --------------
TOTAL ASSETS 4,685,422 919,487
-------------- --------------
CURRENT LIABILITIES
Trade and other payables 17 1,528,340 110,890
Borrowings 18 805,729 -
-------------- --------------
TOTAL LIABILITIES 2,334,069 110,890
-------------- --------------
NET ASSETS 2,351,353 808,597
-------------- --------------
EQUITY
Called up share capital 19 311,561 208,298
Share premium account 19 5,606,918 1,735,315
Share based payment reserve 20 271,260 45,838
Foreign exchange reserve 5 43,490 -
Retained earnings (3,666,828) (1,180,854)
-------------- --------------
Equity attributable to
equity holders of the parent 2,566,401 808,597
Non-controlling interest (215,048) -
-------------- --------------
TOTAL EQUITY 2,351,353 808,597
-------------- --------------
The accompanying notes on pages 42 to 69 form an integral part
of these consolidated financial statements
The financial statements were approved by the board on 2
November 2023 and were signed on its behalf by:
Russell S. Fryer
Executive Chairman
CRITICAL METALS PLC
PARENT COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
Notes As at
As at 30 June
30 June 2023 2022
GBP GBP
------------------------------ ------ -------------- ------------
NON-CURRENT ASSETS
Intercompany receivables 14 2,805,705 -
Loan notes 12 - 39,827
Investment in subsidiary 16 10,000 10,000
-------------- ------------
TOTAL NON-CURRENT ASSETS 2,815,705 49,827
-------------- ------------
CURRENT ASSETS
Trade and other receivables 13 233,942 55,409
Cash at bank and in hand 15 357,481 824,251
-------------- ------------
TOTAL CURRENT ASSETS 591,423 879,660
-------------- ------------
TOTAL ASSETS 3,407,128 929,487
-------------- ------------
CURRENT LIABILITIES
Trade and other payables 17 157,111 120,890
-------------- ------------
TOTAL LIABILITIES 157,111 120,890
-------------- ------------
NET ASSETS 3,250,017 808,597
-------------- ------------
EQUITY
Called up share capital 19 311,561 208,298
Share premium account 19 5,606,918 1,735,315
Share based payment reserve 20 271,260 45,838
Retained earnings (2,939,722) (1,180,854)
-------------- ------------
TOTAL EQUITY 3,250,017 808,597
-------------- ------------
The financial statements were approved by the board on 2
November 2023 and were signed on its behalf by:
Russell S. Fryer
Executive Chairman
Russell S. Fryer
Executive Chairman
CRITICAL METALS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 30 JUNE 2023
Share Based
Issued Share Payments Retained
Capital Share Premium Reserve FCTR Earnings NCI Total Equity
GBP GBP GBP GBP GBP GBP GBP
--------------- --------------- -------------- --------------- ------- --------------- ---------- -------------
As at 30 June
2021 208,298 1,735,315 45,838 - (519,111) - 1,470,340
--------------- --------------- -------------- --------------- ------- --------------- ---------- -------------
Loss for the
year - - - - (661,743) - (661,743)
Other
comprehensive
income - - - - - - -
--------------- -------------- --------------- ------- --------------- ---------- -------------
Total
comprehensive
loss for the
year - - - - (661,743) - (661,743)
Shares issued
during the
year - - - - - - -
Share issue
costs during
the year - - - - - - -
Warrants
issued during
the year - - - - - - -
--------------- -------------- --------------- ------- --------------- ---------- -------------
Total
transactions
with owners - - - - - - -
--------------- -------------- --------------- ------- --------------- ---------- -------------
As at 30 June
2022 208,298 1,735,315 45,838 - (1,180,854) - 808,597
--------------- -------------- --------------- ------- --------------- ---------- -------------
Loss for the
year - - - - (2,485,974) (214,252) (2,700,226)
Other
comprehensive
income - - - 43,490 - - 43,490
--------------- -------------- --------------- ------- --------------- ---------- -------------
Total
comprehensive
loss for the
year - - - 43,490 (2,485,974) (214,252) (2,656,736)
Acquisition of
subsidiary - - - - - (796) (796)
Shares issued
during the
year 83,188 3,624,313 - - - - 3,707,501
Share issue
costs during
the year - (130,885) - - - - (130,885)
Warrants
issued during
the year 20,075 378,175 225,422 - - - 623,672
--------------- -------------- --------------- ------- --------------- ---------- -------------
Total
transactions
with owners 103,263 3,871,603 225,422 - - (796) 4,199,492
--------------- -------------- --------------- ------- --------------- ---------- -------------
As at 30 June
2023 311,561 5,606,918 271,260 43,490 (3,666,828) (215,048) 2,351,353
--------------- -------------- --------------- ------- --------------- ---------- -------------
CRITICAL METALS PLC
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 30 JUNE 2023
Issued Share Share Based Retained Total
Share Capital Premium Payment Reserve Earnings Equity
GBP GBP GBP GBP GBP
---------------------- --------------- ---------- ----------------- ------------ ------------
As at 30 June
2021 208,298 1,735,315 45,838 (519,111) 1,470,340
--------------- ---------- ----------------- ------------ ------------
Loss for the year - - - (661,743) (661,743)
Other comprehensive
income - - - - -
--------------- ---------- ----------------- ------------ ------------
Total comprehensive
loss for the year - - - (661,743) (661,743)
Share issued during
the year - - - - -
Warrants issued
during the year - - - - -
Share issue costs
during the year - - - - -
--------------- ---------- ----------------- ------------ ------------
Total transactions
with the owners - - - - -
--------------- ---------- ----------------- ------------ ------------
As at 30 June
2022 208,298 1,735,315 45,838 (1,180,854) 808,597
--------------- ---------- ----------------- ------------ ------------
Loss for the year - - - (1,758,868) (1,758,868)
Other comprehensive
income - - - - -
--------------- ---------- ----------------- ------------ ------------
Total comprehensive
loss for the year - - - (1,758,868) (1,758,868)
Share issued during
the year 83,188 3,624,313 - - 3,707,501
Share issue costs
during the year - (130,885) - - (130,885)
Warrants issued
during the year 20,075 378,175 225,422 - 623,672
--------------- ---------- ----------------- ------------ ------------
Total transactions
with the owners 103,263 3,871,603 225,422 - 4,200,288
--------------- ---------- ----------------- ------------ ------------
As at 30 June
2023 311,561 5,606,918 271,260 (2,939,722) 3,250,017
--------------- ---------- ----------------- ------------ ------------
CRITICAL METALS PLC
CONSOLIDATED STATEMENT OF CASHFLOW
FOR THE YEARED 30 JUNE 2023
Notes 30 June 2023 30 June
GBP 2022
GBP
-------------------------------- ------ ------------- -----------
Cash from operating activities
Loss for the year (2,700,226) (661,743)
Adjustments for:
Interest payable 38,993 -
Depreciation 10 30,251 -
Foreign exchange 335,122 26,095
Share-based payments 20 225,422 -
-----------
Operating cashflow before
working capital movements (2,070,438) (635,648)
Decrease/ (increase) in
trade and other receivables 297,037 (37,558)
Increase trade and other
payables 64,648 79,835
-----------
Net cash outflow from
operating activities (1,708,753) (593,371)
------------- -----------
Cash from financing activities
Proceeds on the issue of -
shares net of transaction
costs 3,232,049
Proceeds on the exercise -
of warrants 398,250
-----------
Net cash from financing 3,630,299 -
activities
Cash from investing activities
Cash on acquisition of
asset group 11 24,554 -
Payments for asset group 11 (1,582,907) -
Payments for property,
plant and equipment 10 (773,341) -
Accrued interest income - (2,115)
Purchase of convertible
loan notes - (37,712)
------------- -----------
Net cash outflow from
investing activities (2,331,695) (39,827)
------------- -----------
Net decrease in cash and
cash equivalents (410,149) (633,198)
Cash and cash equivalents
at beginning of year 824,251 1,483,544
Foreign exchange (2,406) (26,095)
------------- -----------
Cash and cash equivalents
at end of period 15 411,696 824,251
------------- -----------
The following were material non-cash items during the year:
-- GBP 161,452 relating to invoices settled through funds received for shares issued; and
-- GBP178,938 shares issue outstanding at year end included within other receivables.
The accompanying notes form an integral part of these
consolidated financial statements.
CRITICAL METALS PLC
PARENT COMPANY STATEMENT OF CASHFLOW
FOR THE YEARED 30 JUNE 2023
Notes 30 June 2023 30 June 2022
GBP GBP
Cashflow from operating activities
Loss for the year (1,758,868) (661,743)
Adjustments for:
Interest receivable (92,138) -
Foreign exchange 108,891 26,095
Share based payments 225,423 -
------------- -------------
Operating cashflow before working
capital movements (1,516,692) (635,648)
(Increase)/decrease in trade and
other receivables 11,664 (37,558)
Increase in trade and other payables 188,499 79,835
------------- -------------
Net cash outflow from operating activities (1,316,529) (593,371)
Cashflow from financing activities
Proceeds of borrowings (interco) 8,281 -
Issue of funds to group companies (2,788,821)
Proceeds on the issue of shares net
of transaction costs 19 3,232,049 -
Proceeds on the exercise of warrants 19 398,250 -
------------- -------------
Net cash from financing activities 849,759 -
Cashflow from investing activities
Accrued interest income - (2,115)
Purchase of convertible loan notes - (37,712)
------------- -------------
Net cash from investing activities - (39,827)
Net decrease in cash and cash equivalents (466,770) (633,198)
Cash and cash equivalents at beginning
of year 824,251 1,483,544
Foreign exchange - (26,095)
------------- -------------
Cash and cash equivalents at end
of period 15 357,481 824,251
------------- -------------
The following were material non-cash items during the year:
GBP 161,452 relating to invoices settled through funds received
for shares issued; and
GBP178,938 shares issue outstanding at year end included within
other receivables .
CRITICAL METALS PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 30 JUNE 2023
1. General Information
Critical Metals plc and its subsidiary (the "Group") looks to
develop its existing asset's and identify other potential
companies, businesses or asset(s) that have operations in the
natural resources exploration, development and production
sector.
The Company is domiciled in the United Kingdom and incorporated
and registered in England and Wales as a public limited company.
The Company's registered office is The Broadgate Tower, 20 Primrose
Street, London UK, EC2A 2EW. The Company's registered number is
11388575.
2. Accounting policies
The principal accounting policies applied in preparation of
these consolidated financial statements ("financial statements")
are set out below. These policies have been consistently applied
unless otherwise stated.
2.1. Basis of preparation
The financial statements for the period ended 30 June 2023 have
been prepared by Critical Metals Plc in accordance with UK adopted
International Accounting Standards ("IFRS") and with the
requirements of the Companies Act 2006. The financial statements
have been prepared under the historical cost convention.
The functional currency for each entity in the Group is
determined as the currency of the primary economic environment in
which it operates. The functional currency of the parent company is
Pounds Sterling (GBP) as this is the currency that finance is
raised in. The functional currency of its subsidiaries is US
Dollars (USD) as this is the currency that mainly influences
labour, material and other costs of providing services. The Group
has chosen to present its consolidated financial statements in
Pounds Sterling (GBP), as the Directors believe it is the most
relevant presentational currency for users of the consolidated
financial statements. Foreign operations are included in accordance
with the policies set out at note 2.4.
2.2. Going concern
The Group commenced mine development and processing operations
at the Molulu project in the first half of 2023 and is currently
continuing development activities. The Group expects its first
sales of ore to occur in Q4 of 2023.
The Group's financial statements have been prepared on the going
concern basis, which contemplates that the Group will be able to
realise its assets and discharge liabilities in the normal course
of business. Despite this, there can be no assurance that the Group
will either achieve or maintain profitability in the future and
financial returns arising therefrom, may be adversely affected by
factors outside the control of the Group.
The Group has had recurring losses since incorporation, and its
continuation as a going concern is dependent on the Group's ability
to successfully fund its operations by generating sufficient cash
flow from operations, and where required obtaining additional
financing from equity injections and / or the raising of cash
through bank loans or other debt instruments, to meet any working
capital deficits and fund the Group's exploration activities and
new mine developments.
This indicates that a material uncertainty exists that may cast
significant doubt over the Group's ability to continue as a going
concern and therefore their ability to realise their assets and
discharge their liabilities in the normal course of business.
Whilst acknowledging this material uncertainty, the directors
consider it appropriate to prepare the consolidated financial
statements on a going concern basis for the following reasons:
-- The Group has commenced mining and processing operations at
the Molulu project and is forecasting positive operating cashflow
to be generated from that project in Q4 of 2023;
-- The Group has received committed funding from a leading
financial institution for $3,000,000 USD to fund future exploration
activities and corporate working capital requirements. This amount
is sufficient to cover all budgeted discretionary expenditure;
-- The Group is not required to pay back the loan from Baobab
Asset Management LLC for at least 12 months after the signing of
the accounts;
-- The Group has no committed exploration expenditure on its
granted mining licenses in the Molulu and has the ability to reduce
all spend in the event that it needs to conserve cash balances;
and
-- The Group's Board of Directors have significant experience in
the debt and equity capital markets and specifically have a
successful track record in funding mining operations, new mine
development and exploration activities and are further considered
capable of securing ongoing debt and equity capital financing for
the Group.
The consolidated financial statements do not include the
adjustments that would result if the Group were unable to continue
as a going concern.
The auditors have made reference to going concern by way of a
material uncertainty within the financial statements.
2.3. Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand, and
demand deposits with banks and other financial institutions. A
material amount of cash and cash equivalents is held with
alternative financial institutions. These funds are fully
unrestricted.
2.4. Foreign currency translation
The financial statements are presented in Sterling which is the
Company's functional and presentational currency.
Transactions in currencies other than the functional currency
are recognised at the rates of exchange on the dates of the
transactions. At each balance sheet date, monetary assets and
liabilities are retranslated at the rates prevailing at the balance
sheet date with differences recognised in the Statement of
comprehensive income in the period in which they arise.
2.5. Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
(its subsidiaries) made up to 30 June each year. Per IFRS 10,
control is achieved when the Company:
-- has the power over the investee;
-- is exposed, or has rights, to variable returns from its involvement with the investee; and
-- has the ability to use its power to affects its returns.
The Company reassesses whether or not it controls an investee if
facts and circumstances indicate that there are changes to one or
more of the three elements of control listed above. When the
Company has less than a majority of the voting rights of an
investee, it considers that it has power over the investee when the
voting rights are sufficient to give it the practical ability to
direct the relevant activities of the investee unilaterally. The
Company considers all relevant facts and circumstances in assessing
whether or not the Company's voting rights in an investee are
sufficient to give it power, including:
-- the size of the Company's holding of voting rights relative
to the size and dispersion of holdings of the other vote
holders;
-- potential voting rights held by the Company, other vote holders or other parties;
-- rights arising from other contractual arrangements; and
-- any additional facts and circumstances that indicate that the
Company has, or does not have, the current ability to direct the
relevant activities at the time that decisions need to be made,
including voting patterns at previous shareholders' meetings.
Consolidation of a subsidiary begins when the Company obtains
control over the subsidiary and ceases when the Company loses
control of the subsidiary. Specifically, the results of
subsidiaries acquired or disposed of during the year are included
in profit or loss from the date the Company gains control until the
date when the Company ceases to control the subsidiary. Where
necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with
the Group's accounting policies.
All intragroup assets and liabilities, equity, income, expenses
and cash flows relating to transactions between the members of the
Group are eliminated on consolidation.
The Group recognises any non-controlling interest in the
acquired entity at the non-controlling interest's proportionate
share of the acquired entity's net identifiable assets. Subsequent
to acquisition, the carrying amount of non-controlling interests is
the amount of those interests at initial recognition plus the
non-controlling interests' share of subsequent changes in
equity.
Profit or loss and each component of other comprehensive income
are attributed to the owners of the Company and to the
non-controlling interests. Total comprehensive income of the
subsidiaries is attributed to the owners of the Company and to the
non-controlling interests even if this results in the
non-controlling interests having a deficit balance.
Asset Acquisition
During the year, the Company, through its subsidiary Critical
Metals Mauritius Limited, acquired the entire share capital of
Madini Occidental Limited and the remaining 43% , which hold 70% of
Amani Minerals Katanga SARL. In assessing the acquisition, t he
Group determined that the activities and assets acquired did not
have the required inputs, processes and outputs to constitute as a
business under IFRS 3, hence considered it to be an asset
acquisition.
2.6. Property, Plant & Equipment
Items of property, plant and equipment are stated at cost of
acquisition or production cost less accumulated depreciation and
impairment losses. Depreciation is charged so as to write off the
cost or valuation of assets over their estimated useful lives,
using the straight-line method, on the following bases:
Plant and equipment - 20%
Roads and Buildings - 20%
Motor vehicles - 20%
Due to the tough conditions in the DRC, The Group has reduced
the useful life of the Property, Plant & Equipment to better
reflect the lifecycle of the assets.
A lease liability is recognized in accordance with requirements
of IFRS 16. It requires a lessee to recognise assets and
liabilities for all leases with a term of more than 12 months,
unless the underlying asset is of low value. As at 30 June 2023 the
Group has not entered into any leases with a term greater than 12
months.
Exploration and evaluation
Intangible assets represent exploration and evaluation assets
(IFRS 6 assets), being the cost of acquisition by the Group of
rights, licences and other associated items. Such expenditure
requires the immediate write-off of exploration and development
expenditure that the Directors do not consider to be supported by
the existence of commercial reserves.
All costs associated with mineral exploration and investments,
are capitalised on a project-by-project basis, pending
determination of the feasibility of the project. Costs incurred
include appropriate technical and administrative expenses but not
general overheads and these assets are not amortised until
technical feasibility and commercial viability is established. If
an exploration project is successful, the related expenditures will
be transferred to "mining assets" and amortised over the estimated
life of the commercial ore reserves on a unit of production
basis.
The recoverability of all exploration and development costs is
dependent upon the discovery of economically recoverable reserves,
the ability of the Group to obtain necessary financing to complete
the development of reserves and future profitable production or
proceeds from the disposition thereof.
Exploration and evaluation assets shall no longer be classified
as such when the technical feasibility and commercial viability of
extracting mineral resources are demonstrable. When relevant, such
assets shall be assessed for impairment, and any impairment loss
recognised, before reclassification to "Mine development".
Mine development
Mine development costs are included within property, plant and
equipment. These costs include the costs attributable to the
establishment of mining and processing operations, groundworks and
site preparation.
Whilst the mine is under development no depreciation will be
recognised until such time that production commences.
2.7. Investment in subsidiary
The consolidated financial statements incorporate the results of
subsidiaries using the acquisition method. In the statement of
financial position, the acquiree's identifiable assets, liabilities
and contingent liabilities are initially recognised at their fair
values at the acquisition date. The results of acquired operations
are included in the consolidated statement of comprehensive income
from the date on which control is obtained. They are deconsolidated
from the date on which control ceases.
2.8. Borrowings
Borrowings are recognised initially at fair value, net of
transaction costs. After initial recognition, loans are
subsequently carried at amortised cost. Any difference between the
proceeds (net of transaction costs) and the redemption value is
recognised in the statement of comprehensive income over the period
of the borrowings using the effective interest method. Fees paid on
the establishment of loan facilities are included in the initial
recognition of the loan note.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability or at least 12 months after the end of the reporting
period
2.9. Trade and other receivables
Trade and other receivables are measured at amortised cost,
using the effective interest method, less any impairment loss. An
allowance for impairment of trade and other receivables is
established based on the twelve month expected credit losses unless
the credit quality has deteriorated since inception, in which case
it is based on lifetime losses.
2.10. Financial instruments
IFRS 9 requires an entity to address the classification,
measurement and recognition of financial assets and
liabilities.
a) Classification
The Group classifies its financial assets in the following
measurement categories:
-- those to be measured subsequently at fair value (either
through OCI or through profit or loss);
-- those to be measured at amortised cost; and
-- those to be measured subsequently at fair value through profit or loss.
The classification depends on the Group's business model for
managing the financial assets and the contractual terms of the cash
flows.
For assets measured at fair value, gains and losses will be
recorded either in profit or loss or in OCI. For investments in
equity instruments that are not held for trading, this will depend
on whether the Group has made an irrevocable election at the time
of initial recognition to account for the equity investment at fair
value through other comprehensive income (FVOCI).
b) Recognition
Purchases and sales of financial assets are recognised on trade
date (that is, the date on which the Group commits to purchase or
sell the asset). Financial assets are derecognised when the rights
to receive cash flows from the financial assets have expired or
have been transferred and the Group has transferred substantially
all the risks and rewards of ownership.
c) Measurement
At initial recognition, the Group measures a financial asset at
its fair value plus, in the case of a financial asset not at fair
value through profit or loss (FVPL), transaction costs that are
directly attributable to the acquisition of the financial
asset.
Transaction costs of financial assets carried at FVPL are
expensed in profit or loss.
Debt instruments
Amortised cost: Assets that are held for collection of
contractual cash flows, where those cash flows represent solely
payments of principal and interest, are measured at amortised cost.
Interest income from these financial assets is included in finance
income using the effective interest rate method. Any gain or loss
arising on derecognition is recognised directly in profit or loss
and presented in other gains/(losses) together with foreign
exchange gains and losses. Impairment losses are presented as a
separate line item in the statement of profit or loss.
Equity instruments
The Group subsequently measures all equity investments at fair
value. Dividends from such investments continue to be recognised in
profit or loss as other income when the Group's right to receive
payments is established. Changes in the fair value of financial
assets at FVPL are recognised in other gains/(losses) in the
statement of profit or loss as applicable. Impairment losses (and
reversal of impairment losses) on equity investments measured at
FVOCI are not reported separately from other changes in fair
value.
d) Impairment
The Group assesses, on a forward-looking basis, the expected
credit losses associated with any debt instruments carried at
amortised cost. The impairment methodology applied depends on
whether there has been a significant increase in credit risk. For
trade receivables, the Group applies the simplified approach
permitted by IFRS 9, which requires expected lifetime losses to be
recognised from initial recognition of the receivables.
2.11. Equity
Share capital is determined using the nominal value of shares
that have been issued.
The Share premium account includes any premiums received on the
initial issuing of the share capital. Any transaction costs
associated with the issuing of shares are deducted from the Share
premium account, net of any related income tax benefits.
Equity-settled share-based payments are credited to a
share-based payment reserve as a component of equity until related
options or warrants are exercised or lapse.
Based on IFRS 2, for equity-settled share-based payment
transactions, the entity shall measure the goods or services
received, and the corresponding increase in equity, directly, at
the fair value of the goods or services received, unless that fair
value cannot be estimated reliably. The fair value of the service
received in exchange for the grant of options and warrants is
recognised as an expense , other than those warrants that were
issued in relation to the listing which have been recorded against
share premium in equity. If the entity cannot estimate reliably the
fair value of the goods or services received, the entity shall
measure their value, and the corresponding increase in equity,
indirectly, by reference to the fair value of the equity
instruments granted. The seed warrants issued to the investors and
directors in raising private equity funds is not within the scope
of IFRS 2 and accounting policy mentioned doesn't apply.
Retained losses includes all current and prior period results as
disclosed in the income statement.
2.12. Taxation
Tax currently payable is based on taxable profit for the period.
Taxable profit differs from profit as reported in the income
statement because it excludes items of income and expense that are
taxable or deductible in other years and it further excludes items
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 balance sheet date.
Deferred tax is recognised on differences between the carrying
amounts of assets and liabilities in the financial statements and
the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet 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. Such assets and liabilities are not recognised if
the temporary difference arises from initial recognition of
goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries and associates,
and interests in joint ventures, except where the Group is able to
control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable
future.
The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset
realised. Deferred tax is charged or credited to profit or loss,
except when it relates to items charged or credited directly to
equity, in which case the deferred tax is also dealt with in
equity.
Deferred tax assets and liabilities are offset when 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 Group intends to settle its
current tax assets and liabilities on a net basis.
2.13. Critical accounting judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management
to make judgements, estimates and assumptions that affect the
amounts reported for revenues and expenses during the period and
the amounts reported for assets and liabilities at the balance
sheet date. However, the nature of estimation means that the actual
outcomes could differ from those estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected. The significant accounting judgements and key sources of
estimation uncertainty affecting the Group are disclosed below.
Estimation of fair value of warrants issued in the year
The fair value of the warrants issued during the period have
been calculated using a Black Scholes model which requires a number
of assumptions and inputs, see Note 20 below.
Recoverable value of exploration and development asset
Costs capitalised in respect of the Group's mining assets are
required to be assessed for impairment under the provisions of IFRS
6. Such an estimate requires the Group to exercise judgement in
respect of the indicators of impairment and also in respect of
inputs used in the models which are used to support the carrying
value of the assets prior to reclassification from exploration and
evaluations assets to developments assets. Such inputs include
estimates of mineral reserves, production profiles, commodity
prices, capital expenditure, inflation rates, and pre-tax discount
rates that reflect current market assessments of (a) the time value
of money; and (b) the risks specific to the asset for which the
future cash flow estimates have not been adjusted. As at year end
the Group performed an impairment assessment over both asset
classes. The Directors concluded that there was no impairment as at
30 June 2023.
Capitalisation of development assets
Development expenditure is transferred from 'Exploration and
evaluation assets' to 'Development Assets' once the work completed
to date supports the future development of the property and such
development receives appropriate approvals. There is significant
judgement around the date in which the exploration expenditure can
be transferred to the development asset.
Impairment loans to subsidiaries
The Group and the Company assess at each reporting date whether
there is any objective evidence that loans to subsidiaries are
impaired. To determine whether there is objective evidence of
impairment, a considerable amount of estimation is required to
determine future credit losses over the 12 month period of life
time of the loan.
Business combination
The acquisition of the Madini group required that management
make an assessment on whether the purchase involved identifiable
assets, such as specific equipment, intellectual property rights,
or a particular division, without the concurrent acquisition of
processes, workforce, or other essential inputs required for a
going concern under IFRS 3. Additionally, they must verify that the
acquired set of activities does not constitute a business as
defined by IFRS 3, which includes inputs, processes applied to
those inputs, and outputs, resulting in returns to investors.
Management determined that the purchase did not have the required
characteristics above and was classified as an asset purchase.
New standards and interpretations not yet adopted
At the date of approval of these financial statements, the
following standards and interpretations which have not been applied
in these financial statements were in issue but not yet effective
(and in some cases have not yet been adopted by the UK):
Standard Impact on initial application Effective date
-------------------------------------------------- ------------------------------------------------- ---------------
Annual Improvements 2018-2020 Cycle 1 January 2023
Amendments to IAS 12: Income Taxes Deferred Tax related to Assets and Liabilities 1 January 2023
arising from a Single
Amendments to IAS 1 Classification of liabilities as Current or 1 January 2024
Non-current, effective from 1 January 2024
or Non-current
Amendments to IFRS 16 Leases Lease Liability in a Sale and Leasebacks 1 January 2024
Amendments to IAS 1 Presentation of Financial Non-current Liabilities with Covenants 1 January 2024
Statements
-------------------------------------------------- ------------------------------------------------- ---------------
The effect of these new and amended Standards and
Interpretations which are in issue but not yet mandatorily
effective is not expected to be material.
The directors are evaluating the impact that these standards may
have on the financial statements of the Group.
3. Segmental analysis
The Group has two reportable segments, Mining and Corporate,
which are the Group's strategic divisions. For each of the
strategic divisions, the Board reviews internal management reports
on a regular basis.
The Group's reportable segments are:
Mining: the mining operating segment is presented as an
aggregate of all the DRC related activity and the associated
Mauritian holding companies.
Corporate: the corporate segment is the UK head company and the
costs in respect of managing the Group. This includes the cost of
director share options granted by the Company.
The Group generated no revenue during the year ended 30 June
2023 (2022:GBP0).
Segmental results are detailed below:
For the year ended 30 June 2023:
Mining Corporate Total
GBP GBP GBP
--------------------------------------------- --------------------- ----------------------- -----------------------
Operating loss from continued
operations per reportable
segment (941,358) (1,758,868) (2,700,226)
Reportable segment assets 4,094,001 591,421 4,685,422
Reportable segment liabilities 2,176,959 157,110 2,334,069
Net assets 1,917,042 434,311 2,351,353
--------------------- ----------------------- -----------------------
And for the year ended 30 June 2022:
Exploration Corporate Total
GBP GBP GBP
---------------------------------------------- ------------------------ --------------------- ---------------------
Operating loss from continued
operations per reportable segment - (661,743) (661,743)
Reportable segment assets - 919,487 919,487
Reportable segment liabilities - 110,890 110,890
Net assets - 808,597 808,597
------------------------ --------------------- ---------------------
4. operating loss
This is stated after charging:
30 June 2023 30 June
2022
GBP GBP
------------------------------------------------- ------------------------ ---------------------
Consultancy fees (398,099) (42,399)
Employment costs (497,938) (126,000)
Subcontractors (248,249) -
Insurance (5,488) (17,652)
Costs associated with the re-listing - (202,594)
Professional fees (676,317) (128,195)
Travel expenditure (200,517) (53,508)
Foreign exchange (190,442) 26,096
Administrative expenses (274,472) (119,606)
------------------------ ---------------------
(2,491,522) (663,858)
------------------------ ---------------------
5. Other comprehensive incomE
Items credited/(charged) to the other comprehensive income line
of the statement of comprehensive income relate to the translation
of foreign operations. The corresponding movement is offset against
the foreign exchange reserve in the statement of financial
position.
30 June 2023 30 June 2022
GBP GBP
-------------------------- ------------- -------------
Opening Balance - -
Foreign exchange impact 43,490 -
------------- -------------
Closing Balance 43,490 -
------------- -------------
6. Employees
The average number of persons employed by the Group (including
directors) during the period ended 30 June 2023 was:
30 June 30 June
2023 No 2022 No
of employees of employees
---------------------- ------------------------- -------------------------
Directors 3 3
Employees - -
3 3
------------------------- -------------------------
2023 2022
The aggregate payroll costs of these GBP
persons were as follows: GBP
------------------------------------------------- ------------------- -------------------
Wages and salaries 281,833 126,000
Share-based payments 214,165 -
National insurance 1,940 2,528
------------------- -------------------
497,938 128,528
------------------- -------------------
7. AUDITORS REMUNERATION
2023 2022
GBP GBP
Fees payable to the Group's auditor for the audit of parent
company and consolidated group
financial statements: 70,000 25,800
Reporting accountant fee 60,000 52,000
------------------- ------------------
130,000 77,800
------------------- ------------------
8. taxation
As at 30 As at 30
June 2023 June 2022
GBP GBP
The charge / credit for the year is made
up as follows:
Corporation taxation on the results for -
the year -
----------------------
Taxation charge / credit for the year - -
---------------------- ----------------------
A reconciliation of the tax charge / credit
appearing in the income statement to the
tax that would result from applying the
standard rate of tax to the results for
the year is:
Loss per accounts (2,700,266) (661,743)
---------------------- ----------------------
Tax credit at the applicable rate of 24.7%
(2022: 19%) (666,955) (125,731)
Expenditure disallowable for taxation 53,192 -
---------------------- ----------------------
Tax losses on which no deferred tax asset
has been recognised 613,763 125,731
---------------------- ----------------------
Total tax (charge)/credit - -
---------------------- ----------------------
The weighted average applicable tax rate of 24.7% (2022: 19.0%)
used is a combination of the 25% standard rate of corporation tax
in the UK (2022:19%), 28% standard rate of corporation tax in the
DRC (2022: 28%) and nil corporation tax rate in Mauritius (2022:
nil).
The Group has total carried forward losses of GBP3,203,095 (2022
GBP715,638). The taxed value of the unrecognised deferred tax asset
is GBP 791,164 2022: (GBP224,362) and these losses do not expire.
No deferred tax assets in respect of tax losses have been
recognised in the accounts because there is currently insufficient
evidence of the timing of suitable future taxable profits against
which they can be recovered.
9. EARNINGS per share
The calculation of the basic and diluted earnings per share is
calculated by dividing the profit or loss for the year by the
weighted average number of ordinary shares in issue during the
year
2023 2022
GBP GBP
-------------------------------------------------------------- ------------ -----------
Loss for the year from continuing operations (2,700,226) (661,743)
Weighted number of ordinary shares in issue 54,520,971 41,659,735
------------ -----------
Basic earnings per share from continuing operations - pence (4.95) (1.59)
------------ -----------
There is no difference between the diluted loss per share and
the basic loss per share presented. Share options and warrants
could potentially dilute basic earnings per share in the future but
were not included in the calculation of diluted earnings per share
as they are anti-dilutive for the year presented.
10. Property, plant & Equipment
Group
Exploration &
Plant and equipment Buildings Development Evaluation Total
GBP GBP GBP GBP GBP
--------------------- -------------------------- ------------------ ------------ --------------------- ----------
Cost
Opening balance - 1
July 2022 - - - - -
Acquisition of
Madini Group - - - 3,590,274 3,590,274
Additions 241,906 33,227 356,367 141,841 773,341
Foreign exchange (11,386) (1,564) (16,773) (297,611) (327,334)
Transfer - - 3,434,504 (3,434,504) -
-------------------------- ------------------ ------------ --------------------- ----------
At 30 June 2023 230,520 31,663 3,774,098 - 4,036,281
-------------------------- ------------------ ------------ --------------------- ----------
Depreciation
Opening balance - 1
July 2022 - - - - -
Charge for the
period 30,113 138 - - 30,251
Foreign exchange (1,418) (6) - - (1,424)
-------------------------- ------------------ ------------ --------------------- ----------
At 30 June 2023 28,695 132 - - 28,827
Net book value 1 -
July 2022 - - - -
-------------------------- ------------------ ------------ --------------------- ----------
Net book value 30
June 2023 201,825 31,531 3,774,098 - 4,007,454
-------------------------- ------------------ ------------ --------------------- ----------
Company
Plant and equipment Buildings Development Exploration & Evaluation Total
GBP GBP GBP GBP GBP
------------------------------ -------------------- ---------- ------------ ------------------------- ------
Cost
Opening balance - 1 July 2022 - - - - -
Additions - - - - -
Foreign exchange - - - - -
Transfer - - - - -
-------------------- ---------- ------------ ------------------------- ------
At 30 June 2023 - - - - -
-------------------- ---------- ------------ ------------------------- ------
Depreciation
Opening balance - 1 July 2022 - - - - -
Charge for the period - - - - -
Foreign exchange - - - - -
-------------------- ---------- ------------ ------------------------- ------
At 30 June 2023 - - - - -
Net book value 1 July 2022
-------------------- ---------- ------------ ------------------------- ------
Net book value 30 June 2023 - - - - -
-------------------- ---------- ------------ ------------------------- ------
Development assets relate specifically to commercial interests
held by Critical Metals PLC and its subsidiaries. The Group
currently operates in 1 area of interest via its subsidiaries or
commercial interests being the Molulu project in the Democratic
Republic of the Congo.
The Group has begun the development of the mine site for the
Molulu project. Costs relating to the physical construction of the
site have been capitalised. Once the mine has been completed the
amount will be amortised over the mine life of the area.
11. Acquisition of Amani Mining Katanga SA (AMK) and Madini Occidental Group
On 12 September 2022, Critical Metals PLC via its 100% owned
subsidiary, Critical Metals Mauritius acquired 57% of the equity
instruments of Madini Occidental (MO) a Mauritian based company.
Within the same period Critical Metals Mauritius subsequently
acquired the remaining share capital of MO . On the same date as
the above MO via its 100% owned subsidiary, MO RDC, acquired 70% of
the share capital of Amani Mining Katanga SA (AMK) which has the
rights to the Molulu Project in the DRC.
This brings Critical Metals indirect ownership of the project to
70%. Both acquisitions were assessed as being in-line with the
Groups aim to be a producer of critical metals and commodities.
Under IFRS 3, a business must have three elements: inputs,
processes and outputs to constitute a business combination.
At acquisition AMK and Madini Occidental Group were dormant
exploration companies with little underlying assets. Whilst AMK had
the title to mineral properties this could not be considered inputs
because of their early stage of development.
Additionally AMK and the Madini Group had no processes including
a workforce to produce outputs and had not completed a feasibility
study or a preliminary economic assessment on any of its properties
and had no infrastructure or assets that could produce outputs.
Therefore, the Directors conclusion was that the transaction was an
asset acquisition and not a business combination.
The details of Critical Mauritius's acquisition of MO are as
follows
Net asset group acquired GBP
Exploration assets 3,590,274
Cash and cash equivalents 24,554
Other current liabilities (1,060,059)
Borrowing (561,055)
Other 5,648
Total 1,999,362
--------------------------- ------------
Total purchase price GBP
Amount settled in cash 1,582,907
Deferred consideration 416,455
Total 1,999,362
------------------------ ----------
12. Loan notes
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
------------------ -------------------- ------------------ -------------------
Convertible loan notes - - 39,827 39,827
------------------ -------------------- ------------------ -------------------
- - 39,827 39,827
------------------ -------------------------------------------------------- ------------------ -------------------
In the prior year the Company entered into an agreement to
purchase loan notes in Madini Occidental Ltd. These notes have a
long stop date of 30 September 2022 and in the event that they have
not been redeemed by this date the noteholders have the option to
convert their notes into equity. Interest is payable on the notes
at a rate of 10% per annum and Madini Occidental may redeem the
paid amount of the notes in full or part subject to first serving 5
business days prior written notice to the noteholders. As at
balance date the notes have not been converted to equity.
13. TRADE AND OTHER RECEIVABLES
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
-------------------- -------------------- ------------------ -------------------
Prepayments 19,934 16,917 9,592 9,592
Other debtors 233,414 204,101 10,000 10,000
VAT receivable 12,924 12,924 35,817 35,817
-------------------- -------------------- ------------------ -------------------
266,272 233,942 55,409 55,409
-------------------- -------------------- ------------------ -------------------
Included in other debtors is an amount of GBP178,939 (2022: nil)
which represents shares that have been issued but remain unpaid at
year end. Subsequent to year end the full amount was collected.
14. Intercompany receivables
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
----------------- --------------------- ----------------- -------------------
Intercompany - 2,805,705 - -
loan-Critical Metals
Mauritius
----------------- --------------------- ----------------- -------------------
- 2,805,705 - -
----------------- --------------------- ----------------- -------------------
Intercompany receivables represents an intra-group loan facility
from Critical Mauritius PLC to its subsidiary Critcal Metals
Mauritius Ltd. The loan is denominated in USD and attracts interest
at 8% per annum. The loan becomes repayable when the excess
cashflows from operations exceed a certain threshold agreed upon by
both parties.
The Group has recognised a loss of GBPNil in the profit or loss
in respect of the expected credit losses for the year ended 30 June
2023.
15. Cash at bank and in hand
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
------------------- ------------------- ------------------- -------------------
Cash at bank 411,696 357,481 824,251 824,251
------------------- ------------------- ------------------- -------------------
411,696 357,481 824,251 824,251
------------------- ------------------- ------------------- -------------------
Majority of the entities cash at bank is held with alternative
financial institutions.
The carrying amounts of the Group and Company's cash and cash
equivalents are denominated in the following currencies:
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
------------------- ------------------- ------------------- -------------------
UK Pounds 341,687 341,686 634,501 634,501
US Dollars 64,557 10,343 183,398 183,398
South African Rand 1,175 1,175 3,651 3,651
Euro 4,277 4,277 2,701 2,701
------------------- ------------------- ------------------- -------------------
411,696 357,481 824,251 824,251
------------------- ------------------- ------------------- -------------------
16. Investment in subsidiaries
30 June 2023 30 June 2022
GBP GBP
Company Company
------------------------ ------------------------
Critical Metal Mauritius Ltd 10,000 10,000
------------------------ ------------------------
10,000 10,000
------------------------ ------------------------
As at 30 June 2023, the Group owned interests in the following
subsidiary undertakings, which are included in the consolidated
financial statements:
Incorporation Country of Registered
N ame date Holding Business activity incorporation address
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Critical Metal 14 September 2021 100% Critical Holding M auritius The Broadgate
Mauritius Ltd Metals Plc Tower, 20
Primrose street,
London, EC2A 2EW
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Madini Occidental 27 March 2019 100% Critical Holding M auritius 3(rd) Floor,
Ltd Metals Mauritius Tower A, 1
Ltd Cybercity, Ebene,
Mauritius 72201
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Madini Holding 14 March 2019 100% Madini Dormant Democratic Local 7, 4 Eme
RDC SARL Occidental Ltd Republic of the Niveau, C/Gombe,
Congo V/Kinshasa,
P/Kinshasa
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
MO RDC SA 22 September 2019 100% Madini Holding Democratic Conseil, 60
Occidental Ltd Republic of the Avenue Uvira,
Congo Immeuble Aimee
Tower, 11 eme
Etage, Gombe,
Kinshasa
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Minière 5 April 2019 100% MO RDC SA Dormant Democratic Local 7, 4 Eme
Molulu SARL Republic of the Niveau, C/Gombe,
Congo V/Kinshasa,
P/Kinshasa
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Amani Minerals 7 August 2019 70% MO RDC SA Mining & Democratic 33132 Ave Colonel
Katanga SA Exploration Republic of the Mondjiba,
Congo Quartier Basoko,
Ngaliema,
Kinshasa, DRC
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
17. TRADE AND OTHER PAYABLES
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
--------------------------------- --------------------- ------------------- ------------------ -------------------
Trade payables 757,603 111,379 78,010 78,010
Other payable and
accruals 100,749 45,732 32,880 42,880
Deferred 585,741 -
consideration - -
Provision for option 84,247 -
relinquishment - -
--------------------- ------------------- ------------------ -------------------
1,528,340 157,111 110,890 120,890
--------------------- ------------------- ------------------ -------------------
Deferred consideration relates to $733,588 USD payable for the
acquisition of the Madini Group. As at report date the amount has
not been paid.
18. Borrowings
30 June 2023 30 June 2022
GBP GBP GBP GBP
Group Company Group Company
Loan from related party 633,127 - - -
Accrued interest 172,602
805,729 - - -
------------------- ------------------- ----------------- -------------------
Borrowings consist of an $800,000 USD loan to Madini Occidental
from Baobab investments LLC, an entity controlled by the CEO
Russell Fryer. Refer to note 24 for further information. The loan
is unsecured and payable within 12 months of signing. An interest
charge of GBP39,179 (2022:nil) was recorded in the Statement of
Comprehensive Income.
19. Share capital and share premium
Number Share Share
of Shares Capital Premium Total
on Issue GBP GBP GBP
----------------------- ---------------------- ------------------- --------------------- ---------------------------------------
Balance at
1 July
2021 41,659,735 208,298 1,735,315 1,943,613
---------------------- ------------------- --------------------- ---------------------------------------
Balance at
30 June
2022 41,659,735 208,298 1,735,315 1,943,613
---------------------- ------------------- --------------------- ---------------------------------------
Shares
issued at
re-listing
at GBP0.20 9,000,000 45,000 1,755,000 1,800,000
GBP0.10
warrants
exercised 3,150,000 15,750 299,250 315,000
Adviser
shares
issued 37,500 188 7,313 7,501
Placement
at GBP0.25 5,200,000 26,000 1,274,000 1,300,000
GBP0.05
Warrants
Exercised 15,000 75 675 750
GBP0.10
Warrants
Exercised 600,000 3,000 57,000 60,000
GBP0.10
Warrants
Exercised 200,000 1,000 19,000 20,000
GBP0.05
Warrants
Exercised 50,000 250 2,250 2,500
Fundraise -
GBP0.6m @
GBP0.25 2,400,000 12,000 588,000 600,000
Cost of
share
issues - - (130,885) (130,885)
---------------------- ------------------- --------------------- ---------------------------------------
Balance at
30 June
2023 62,312,235 311,561 5,606,918 5,918,479
---------------------- ------------------- --------------------- ---------------------------------------
The Company has only one class of share. All ordinary shares
have equal voting rights and rank pari passu for the distribution
of dividends and repayment of capital.
20. SHARE BASED PAYMENTS RESERVE
2022 2021
Group and Company GBP GBP
Opening balance 45,838 45,838
Directors warrants issued (1) 214,164 -
LEJ & Broker warrants issued (2) 11,258 -
At 31 December 271,260 45,838
-------- -----------
(1- On 12 September 2022 upon the successful re-admission to the
LSE 2,750,000 warrants were issued to the directors of the Company.
The warrants vest immediately with further details below.)
(2- On 12 September 2022 upon the successful re-admission to the
LSE 3,233,200 warrants were issued to brokers and third parties who
assisted in the admission. The warrants vest immediately with
further details below.)
The fair value of the services received in return for the
warrants granted are measured by reference to the fair value of the
warrants granted. The estimate of the fair value of the warrants
granted is measured based on the Black-Scholes valuations model.
Measurement inputs and assumptions are as follows:
Director LEJ and Broker
warrants warrants
------------------------------------------ ------------ ---------------
Issue date 12 Sep 2022 12 Sep 2022
Time to expiry 3 years 3 years
Share price at date of issue of warrants GBP0.20 GBP0.20
Exercise price GBP0.05 GBP0.20
Expected volatility 46.5% 46.5%
Risk free interest rate 3.4% 3.4%
------------------------------------------ ------------ ---------------
During the year 11,400,000 warrants were issued alongside share
placements. As the warrants were issued as 'free and attaching'
they are considered part of the underlying share and fall outside
the scope of IFRS 2 and have not been valued.
2023 2022
------------------------ ------------------------
Weighted Weighted
average average
exercise Number exercise Number
price of options price of options
--------------------------------- ---------- ------------ ---------- ------------
Outstanding at the beginning
of the year 8.1p 9,240,714 8.1p 9,240,714
Exercised during the year - -
(Share options) - (4,015,000)
Granted during the year (Share
options) 40p 9,000,000 - -
Granted during the year (Share
options) 40p 2,400,000 - -
Granted during the year (Share
options) 5p 2,750,000 - -
Granted during the year (Share
options) 20p 323,200 - -
Outstanding at the end of
the year 26p 19,698,914 8.1p 9,240,714
Exercisable at the end of
the year 26p 19,698,914 8.1p 9,240,714
--------------------------------- ---------- ------------ ---------- ------------
During the year the Company extended the last exercise date of
the GBP0.05 and GBP0.10 warrants that were expiring on 28 September
2022 to 31 March 2023 and then to 30 September 2023 and subsequent
to year end, these were further extended to 31 December 2023.
21. Risk Management
General objectives and policies
The overall objective of the Board is to set policies that seek
to reduce as far as practical without unduly affecting the Group's
competitiveness and flexibility. Further details regarding these
policies are:
Policy on financial risk management
The Group's principal financial instruments comprise cash and
cash equivalents, trade and other receivables, loan notes and trade
and other payables. The Group's accounting policies and methods
adopted, including the criteria for recognition, the basis on which
income and expenses are recognised in respect of each class of
financial asset, financial liability and equity instrument are set
out in note 1 - "Accounting Policies".
The Group does not use financial instruments for speculative
purposes. The carrying value of all financial assets and
liabilities approximates to their fair value.
Derivatives, financial instruments and risk management
The Group does not use derivative instruments or other financial
instruments to manage its exposure to fluctuations in foreign
currency exchange rates, interest rates and commodity prices.
Foreign currency risk management
The scope and level of operations that the Group is undertaking
has increased in the current year and will continue to increase in
years to come. With the acquisition of an asset based in the
Democratic Republic of Congo the Group will also increase its
exposure to foreign currency risk. Despite the increase in exposure
the directors believe that it is within a reasonable threshold that
it does not materially adversely affect the operations of the Group
and hence they have not entered into any strategies to mitigate the
risk at this stage. In the current period the impact of foreign
currency movement is limited to the impact it has on the relatively
small denominations of currency that the Group holds in foreign
currencies.
Credit risk
Credit risk refers to the risk that a counterparty will default
on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with
creditworthy counterparties. The Group's exposure and the credit
ratings of its counterparties are monitored by the board of
directors to ensure that the aggregate value of transactions is
spread amongst approved counterparties.
The Group applies IFRS 9 to measure expected credit losses for
receivables, these are regularly monitored and assessed.
Receivables are subject to an expected credit loss provision when
it is probable that amounts outstanding are not recoverable as set
out in the accounting policy. The impact of expected credit losses
was immaterial.
The Group's principal financial assets are cash and cash
equivalents, loan notes and trade and other receivables. Cash
equivalents include amounts held on deposit with financial
institutions.
The credit risk on liquid funds held in current accounts and
available on demand is limited because the Group's counterparties
are banks with high credit-ratings assigned by international
credit-rating agencies.
No financial assets have indicators of impairment.
The Group's maximum exposure to credit risk is limited to the
carrying amount of financial assets recorded in the financial
statements.
As at 30 June 2023 the foreign currency risk exposure of the
Group was comprised of the following:
As at
30 June 2023
--------------------------- --------------
GBP
--------------------------- --------------
CURRENT ASSETS
Other current assets 32,329
Cash at bank and in hand 64,557
--------------
TOTAL ASSETS 96,886
--------------
NON-CURRENT LIABILITIES
Borrowings 805,729
CURRENT LIABILITIES
Trade and other payables 1,371,232
--------------
TOTAL LIABILITIES 2,176,961
--------------
NET POSITION (2,080,075)
--------------
Borrowings and interest rate risk
The Group currently has an unsecured loan to Baobab Asset
Management LLC. The loan compounds interest at 6% per annum and has
no fixed repayments. The Group has no other borrowings. The Group's
principal financial assets are cash and cash equivalents, loan
notes and trade and other receivables. Cash equivalents include
amounts held on deposit with financial institutions. The effect of
variable interest rates is not significant.
Liquidity risk
During the period ended 30 June 2023 and year ended 30 June
2022, the Group was financed by cash raised through equity funding.
Funds raised surplus to immediate requirements are held as
short-term cash deposits in Sterling.
The maturities of the cash deposits are selected to maximise the
investment return whilst ensuring that funds will be available as
required to maintain the Group's operations.
In managing liquidity risk, the main objective of the Group is
to ensure that it has the ability to pay all of its liabilities as
they fall due. The Group monitors its levels of working capital to
ensure that it can meet its liabilities as they fall due.
The table below shows the undiscounted cash flows on the Group's
financial liabilities on the basis of their earliest possible
contractual maturity.
For the Group:
Within Within
2 months 2-6 months
Total GBP GBP GBP
------------------------------------- ---------- --------------------- -----------------------
At 30 June 2023
Trade payables 757,603 757,603 -
Other payable and accruals 100,749 100,749 -
Deferred consideration 585,741 585,741 -
Provision for option relinquishment 84,247 - 84,247
---------- --------------------- -----------------------
1,528,340 1,444,093 84,247
---------- --------------------- -----------------------
Within Within
2 months 2-6 months
Total GBP GBP GBP
---------------------------- ---------- --------------------- -----------------------
At 30 June 2022
Trade payables 78,010 78,010 -
Other payable and accruals 32,880 32,880 -
---------- --------------------- -----------------------
110,890 110,890 -
---------- --------------------- -----------------------
And for the Company:
Within Within
2 months 2-6 months
Total GBP GBP GBP
---------------------------- ---------- --------------------- -----------------------
At 30 June 2023
Trade payables 111,379 111,379 -
Other payable and accruals 45,732 45,732 -
---------- --------------------- -----------------------
157,111 157,111 -
---------- --------------------- -----------------------
Within Within
2 months 2-6 months
Total GBP GBP GBP
---------------------------- ---------- --------------------- -----------------------
At 30 June 2022
Trade payables 78,010 78,010 -
Other payable and accruals 32,880 32,880 -
---------- --------------------- -----------------------
110,890 110,890 -
---------- --------------------- -----------------------
Capital management
The Group manages its capital to ensure that it will be able to
continue as a going concern while maximising the return to
stakeholders. The overall strategy of the Group is to minimise
costs and liquidity risk.
The capital structure of the Group consists of equity
attributable to equity holders of the Group, comprising issued
share capital, reserves and retained earnings as disclosed in the
consolidated statement of changes of equity.
The Group is exposed to a number of risks through its normal
operations, the most significant of which are interest, credit,
foreign exchange, commodity and liquidity risks. The management of
these risks is vested to the board of directors.
22. FINANCiaL ASSETS AND FINANCIAL LIABILITIES
For the Group:
Financial assets Financial Financial
at fair value assets at liabilities
through profit amortised at amortised
2023 or loss cost cost Total
Financial assets
/ liabilities GBP GBP GBP GBP
----------------------------- ------------------ ----------- -------------- ------------
Trade and other receivables - 246,338 - 246,338
Cash and cash equivalents - 411,696 - 411,696
Trade and other payables - - (942,601) (942,601)
Borrowings - - (805,729) (805,729)
Deferred consideration - - (585,741) (585,741)
- 658,034 (2,334,071) (1,676,037)
------------------------------------------------ ----------- -------------- ------------
Financial assets Financial Financial
at fair value assets at liabilities
through profit amortised at amortised
2022 or loss cost cost Total
Financial assets
/ liabilities GBP GBP GBP GBP
--------------------------- ------------------ ----------- -------------- ----------
Trade and other
receivables - 55,409 - 55,409
Loan Notes - 39,827 - 39,827
Cash and cash equivalents - 824,251 - 824,251
Trade and other
payables - - (120,890) (120,890)
- 919,487 (120,890) 798,597
---------------------------------------------- ----------- -------------- ----------
For the Company:
Financial assets Financial Financial
at fair value assets at liabilities
through profit amortised at amortised
2023 or loss cost cost Total
Financial assets
/ liabilities GBP GBP GBP GBP
----------------------------- ------------------ ----------- -------------- ----------
Trade and other receivables - 217,025 - 217,025
Cash and cash equivalents - 357,481 - 357,481
Trade and other payables - - (111,379) (111,379)
- 574,506 (111,379) 463,127
------------------------------------------------ ----------- -------------- ----------
Financial Financial Financial
assets at fair assets at liabilities
value through amortised at amortised
2022 profit or loss cost cost Total
Financial assets
/ liabilities GBP GBP GBP GBP
----------------------------- ----------------- ----------- -------------- ----------
Trade and other receivables - 55,409 - 55,409
Loan Notes 39,827 39,827
Cash and cash equivalents - 824,251 824,251
Trade and other payables - - (110,890) (110,890)
- 919,487 (110,890) 808,597
----------------------------------------------- ----------- -------------- ----------
23. RECONCILIATION OF NET CASHLOWS TO MOVEMENT IN NET DEBT
For the Group:
As at 1 Cash flows Acquisition Non cash As at 30
July 2022 charges June 2023
--------------- ----------- ----------- ------------ ---------- -----------
GBP GBP GBP GBP GBP
--------------- ----------- ----------- ------------ ---------- -----------
Cash and cash
equivalents
--------------- ----------- ----------- ------------ ---------- -----------
Cash 824,251 (434,703) 24,554 (2,406) 411,696
--------------- ----------- ----------- ------------ ---------- -----------
Borrowings
--------------- ----------- ----------- ------------ ---------- -----------
Loan - - (561,055) (244,674) (805,729)
--------------- ----------- ----------- ------------ ---------- -----------
Total 824,251 (434,703) (536,501) (247,080) (394,033)
--------------- ----------- ----------- ------------ ---------- -----------
For the Company:
As at 1 Cash flows Acquisition Non cash As at
July 2022 charges 30 June
2023
--------------- ----------- ----------- ------------ --------- ---------
GBP GBP GBP GBP GBP
--------------- ----------- ----------- ------------ --------- ---------
Cash and cash
equivalents
--------------- ----------- ----------- ------------ --------- ---------
Cash 824,251 (466,770) - - 357,481
--------------- ----------- ----------- ------------ --------- ---------
Total 824,251 (466,770) - - 357,481
--------------- ----------- ----------- ------------ --------- ---------
24. Related party transactions
Details of directors' remuneration during the year are given in
Directors' Report on page 18 to 19.
Provision of Services
During the year, GBP45,180 (2022: GBP18,360) was incurred for
the provision of administrative and corporate accounting services
from Orana Corporate LLP, an entity related to director Anthony
Eastman. GBP11,688 (2022: 1,848) was owing at year end and is
included in trade payables - note 17.
Purchase of Share Capital of Madini Occidental Limited
During the year the Group acquired the remaining 21.5% of the
share capital of Madini Occidental from the Chief Executive Officer
, Russell Fryer . Total consideration was GBP450,000 in cash paid
on completion and a further GBP200,000 was due on or before 1
October 2023, to be paid in Critical Metals PLC shares at a price
equal to the 10 day volume weighted average or cash, at the
Company's election. The amount has not been paid as at the date of
this report.
Loan to Baobab Asset Management LLC
As part of the acquisition of Madini Occidental the Group
acquired a $800,000 USD loan from Baobab Asset Management LLC, a
company controlled by the CEO Russell Fryer, to Madini Occidental.
The loan accrues interest at 6% ,compounds annually and is payable
on demand.
Issue of warrants
In the current year the directors were awarded the following
warrants:
Russell Fryer - 1,500,000
Anthony Eastman - 750,000
Marcus Edwards-Jones - 500,000
As part of the re-admission 226,750 warrants were issued to
Lloyd Edwards-Jones, a related party of Marcus Edwards-Jones, for
fundraising consulting work. Further details can be found in note
20.
25. commitmentS And contingencies
There were no capital commitments or contingent liabilities at
30 June 2023 (2022 nil).
26. ultimate controlling party
The Directors consider that there is no controlling or ultimate
controlling party of the Company.
27. Events subsequent to year end
Exercise of warrants and term extension
On 11(th) September 2023 the Company has received warrant
exercise notices to subscribe for a total of 2,814,286 new ordinary
shares of GBP0.005 each in the capital of the Company split between
1,100,000 Ordinary Shares at an exercise price of GBP0.10 per
Ordinary Share and an additional 1,714,286 Ordinary Shares at an
exercise price of GBP0.05 per Ordinary Share. A total of 2,814,286
Warrant Shares have been exercised resulting in total gross
proceeds to the Company of GBP195,714.30.
Additionally the exercise period of a total of 9,000,000
warrants, which are exercisable on or before the 11 September 2023
at 40 pence per share were extended to 31 March 2024, and a total
of 2,171,428 warrants held by the Directors which are exercisable
on or before 30 September 2023 to 31 December 2023.
Finance agreement
On 18 September 2023 the Company entered into a non-dilutive
finance agreement. The debt term is for 9 months from the date of
execution of the agreement for the first US$500,000 instalment,
with a committed further tranche of US$500,000 available at the
Company's election following the satisfaction of the funding
conditions (being committed sales for the existing stockpiles). The
Company also has the ability to request further funds are available
up to the maximum utilisation of US$3 million.
The key funding terms are:
- 15% fixed coupon for the term;
- The second tranche is available for 150 days after the first tranche;
- Repayable at any time at the election of the Company;
- Personal guarantee from Russell Fryer by way of the pledge of
his ordinary shares in the Company; and
- Grant of 2,000,000 warrants over ordinary shares in the Company.
Revenue offtake agreement
On 9(th) October the Company announced that it had entered into
an offtake agreement with OM Metal & Resources S.A.R.L for the
sale of a minimum of 20,000 tonnes of copper oxide ore from the
Group's Molulu copper/cobalt project in the Democratic Republic of
Congo.
The Agreement is valid from 4 October 2023 to 31 December 2023
and can be renewed on mutual agreement from both parties. During
the contract, and where possible, Critical Metals will provide the
Buyer with copper ore with an average minimum acid soluble copper
grade of 1.5%.
There have been no other events subsequent to year end.
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END
FR NKBBQCBDDBDK
(END) Dow Jones Newswires
November 03, 2023 03:05 ET (07:05 GMT)
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