TIDMKAT
RNS Number : 3499Z
Katoro Gold PLC
21 May 2021
Katoro Gold Plc
(Incorporated in England and Wales)
(Registration Number: 9306219
Share code on the AIM: KAT
ISIN: GB00BSNBL022
("Katoro" or "the Company")
Annual Financial Results for the year ended 31 December 2020
Dated 21 May 2021
Katoro Gold pl c ("K atoro" or t he "Co m pa n y") ( AIM: K AT),
t he Tanzanian focused e x p lora t ion a nd de v e l op m ent c o
m pa ny is p l e a s ed to present its audited annual financial
statements f or the year en ded 31 December 20 20 as extracted from
the Company's 2020 Annual Report which is now available on the
Company's website at www.katorogold.com . The Company's Annual
Report is in the process of being prepared for dispatch to
shareholders. Details of the date and venue for this year's AGM,
will be announced on posting of the Annual Report.
Overview
-- The Company entered into a binding conditional agreement to
form a 50/50 unincorporated joint venture in South Africa, focused
on the reprocessing of an existing 1.34 million ounce of gold JORC
compliant tailings resource.
-- The Company completed technical work related to the upgrade
and restatement of the Blyvoor Gold Tailings
Project resource statement. Significant progress was made towards securing the necessary funding.
-- The Haneti Joint Venture was further strengthened, with Power
Metal Resources plc (LON:POW) acquiring a further 10% taking their
holding to 35% with Katoro retaining 65%
-- The commencement of a 2,000 m RAB drilling programme at the
Haneti Project which consists of approximately 50 holes drilled.
The programme seeks to verify the existence of near surface nickel
sulphide mineralisation at each target whilst increasing the
geological understanding in order to ensure the follow-up diamond
drill programme can be optimised.
-- Post period end:
o Drilling results from the RAB drill programme carried out at
the Haneti project, confirmed the results from previous exploration
work done, which was the primary objective. The latest results
provided the confirmation desired to take the next step in the
exploration strategy for Haneti.
o Raised GBP960,000 (gross) through a placing and subscription
of 48,000,000 new ordinary shares of 1.00p each in the capital of
the Company at 2.00p per share.
o At Blyvoor Gold Tailing project, the technical team continue
to work towards conclusion of all preparatory work and funding
negotiations.
This announcement contains inside information as stipulated
under the Market Abuse Regulations (EU) no. 596/2014.
For further information please visit www.katorogold.com
Louis Coetzee louisc@katorogold.com Katoro Gold plc Executive Chairman
Bhavesh Patel +44 20 3440 6800 RFC Ambrian Limited Nominated Adviser
Andrew Thomson
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Nick Emmerson +44 (0) 1483 413 SI Capital Ltd Broker
Sam Lomanto 500
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Isabel de Salis +44 (0) 20 7236 St Brides Partners Investor and Media
1177 Ltd Relations Adviser
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Chairman's Report
Dear Shareholders
2020 was a year like no other. The worldwide COVID-19 pandemic
turned many lives up-side down, whether from a financial, business
or indeed personal perspective. Katoro, however, is grateful to
look back on a year of many achievements. As Chairman I would like
to take this moment to thank Katoro's Directors, Management,
business partners and shareholders alike for their dedication and
commitment shown during this challenging period.
2020 Overview
2020 was a year in which Katoro consolidated its strategy and
made great strides in its quest to first production.
In Tanzania, the Company advanced the Haneti Polymetallic
Project and announced at the year-end that drilling had commenced.
The drill programme was designed to provide enhanced information of
the subsurface shape and orientation of the ultramafic rock bodies
being targeted and allowing for the optimisation of a planned
follow-on diamond drill programme.
Furthermore, the Company completed technical work related to the
upgrade and restatement of the Blyvoor Gold Tailings Project
resource statement. Significant progress was made towards securing
the necessary funding, sufficient to fund the construction and
commissioning of a Beneficiation Plant and auxiliary
operations.
The Company also finalised the disposal of the Imweru project by
executing the sales transaction with Lake Victoria Gold. Following
assessment of the recoverability of the remaining consideration
receivable from the counterparty, management thought it prudent to
raise a provision for impairment, and resultantly the Group
impaired its financial asset receivable and investment in
subsidiaries in the amount of GBP652,815 and GBP1,023,706
respectively as at December 2020.
The Company further strengthened its balance sheet with
financing of approximately GBP3m during the period, including a
capital placing raise toward the end of the year of GBP960k that
was conditional to and received shareholder approval at a General
Meeting ('GM') that was held on 15 January 2021. We would like to
thank the shareholders for their continued support.
The Haneti Polymetallic Project
The Haneti Project comprises prospecting license portfolio for
nickel, PGMs and gold in central Tanzania forming a near contiguous
project block. Intensive historic field and study work was done on
the principal target zone, an 80km long ultra-mafic belt with
grades of up to 13.6% nickel and 2.33g/t combined PGM's. During the
period the licence for the Haneti nickel deposit expired and the
group submitted the application for the renewal of the licence and
paid the relevant fee, all within the allowed timelines. Management
considers that the issuance of the renewed license is an
administrative delay.
During the reporting period, Katoro developed and implemented
plans to drill a two-stage programme at Haneti, focusing on nickel
sulphide and PGM targets at Mihanza Hill and Mwaka Hill, the two
priority targets. The first of these two stages, a 2000m Rotary Air
Blast ("RAB") maiden drill programme was implemented during late
December 2020 and completed six weeks later. The second stage,
depending on the results of the RAB programme would be to follow up
with a limited diamond drill programme. As the RAB programme still
collected material from the weathered zone, the purpose of the
second phase would be to collect fresh rock material at depth, in
order to further refine planning for an intense diamond drilling
campaign.
The Haneti Joint Venture was further strengthened in August,
with Power Metal Resources plc (LON:POW) acquiring a further 10%
taking their holding to 35% with Katoro retaining 65%.
Katoro continued to receive approaches with a view to earn-in,
joint venture or other similar structures in respect of the
project, with a primary focus on the nickel sulphide potential.
Discussions with our joint venture partner Power Metal Resources
continued with regard to these approaches.
The Blyvoor Gold Tailings Project
In early 2020 the Company entered into a strategic gold
production opportunity in South Africa, focused on the reprocessing
of an existing 1.34 million ounce of gold JORC compliant tailings
resource. Katoro entered into a binding conditional agreement to
form a 50/50 unincorporated joint venture.
From a technical perspective the Company continued to make
excellent progress with restating the Mineral Resource in the
SAMREC code. In this regard, the slightly increased c. 1.4 Million
Oz Resource consists of c. 868 kOz in the Measured & Indicated,
and c. 542 kOz Inferred in the categories respectively. This
represents a c. 216% increase in the combined Measured and
Indicated categories.
The Company made excellent progress towards the finalisation of
a SAMREC Mineral Reserve and SAMVAL valuation of the Blyvoor Gold
Tailings Project which will ultimately drive and define the project
financing structure. The Company received multiple expressions of
interest to finance the project during the period and with the high
level of finance interest shown, Katoro and its joint venture
partners worked diligently to assess each of the expressions of
interest shown.
Post Year-End Statement
Post reporting period, the Company has continued to make
significant progress on all aspects of the business.
The Maiden drill programme at Haneti completed with 1,965 metres
of RAB drilling completed over 50 holes at Mihanza Hill and Mwaka
Hill with 1,965 samples collected. We are delighted to report that
following receipt of the results from the recently completed RAB
drill programme at Haneti, the decision has been made to advance
the Haneti Nickel PGM Project to deep diamond drilling. Information
from the recent shallow drilling results and the discovery of new
gossanous nickel-copper-magnetite veining at Mihanza Hill,
confirmed the results from previous exploration work done at
Haneti, which was the primary objective of the RAB drill programme.
The latest results provided the confirmation we wanted to take the
next step in our exploration strategy for Haneti and to proceed
with deep diamond drilling. With the diamond drill programme, we
will assess the potential for possible economic nickel sulphide
mineralisation at Haneti.
At Blyvoor, the technical team continue to work towards
conclusion of all preparatory work and funding negotiations in the
pursuit to Financial Close in the shortest possible time.
This report was approved on 20 May 2021 by:
Louis Coetzee
Executive Chairman
Strategic Report
The Board of Directors present their strategic report together
with the audited annual financial statements for the year ended 31
December 2020 of Katoro Gold PLC (the "Company") and its
subsidiaries (collectively the "Group").
Principal activities
The principal activity of the Group is gold and nickel focussed
exploration activities in Tanzania and South Africa.
Review of business in the year
The Group is in its early stage of development and details of
the operational activities of the Group are included in the
Chairman's report.
Financial activities
Description 31 December 2020 31 December 2019
Administrative expenses (894,872) (514,220)
Share based payment transactions (225,778) (91,597)
Foreign exchange (losses)/gain (76,889) 1,649
Exploration expenditure (1,394,715) (102,152)
Other income 43,873 37,661
Loss before tax (2,561,114) (668,659)
Finance income 9,570 -
Finance cost (22,303) -
Total comprehensive loss (2,448,710) (664,077)
The movement in the total comprehensive loss year-on-year, as
disclosed in the table above and in the statement of comprehensive
income, is mainly owing to the following causes:
-- Increase in administrative expenses is due to cost of
additional funding activities undertaken during the current period,
coupled with additional professional fees;
-- Increase in exploration expenditure related to the Blyvoor Joint Venture exploration; and
-- Increase in other income originating from the profit on
disposal of the Reef Miners Limited subsidiary.
Key performance indicators
Management does not consider there to be any key financial KPI's
at this stage, other than the loss per share for the period, which
is included in the statement of comprehensive income. As and when
operational activities increase management will reconsider the key
financial KPI's and update the necessary disclosures accordingly.
Non-financial KPI's comprise the measure of advancement with
respect to the various key exploration projects over the medium to
long term.
Principal Risks and Uncertainties
The realisation of exploration and evaluation assets is
dependent on the discovery and successful development of economic
mineral reserves and is subject to a number of significant
potential risks summarised as follows, and described further
below:
-- Financial instrument & Foreign exchange risk;
-- Strategic risk;
-- Funding risk;
-- Commercial risk;
-- Operational risk;
-- Speculative Nature of Mineral Exploration and Development;
-- Political Stability; and
-- Foreign investment risks including increases in taxes,
royalties and renegotiation of contracts.
Financial instrument and foreign exchange risk
The Company and Group are exposed to risks arising from
financial instruments held and foreign exchange transactions
entered into throughout the period. These are discussed in Note 20
to the Annual Financial Statements.
Strategic risk
Significant and increasing competition exists for mineral
acquisition opportunities throughout the world. As a result of this
competition, the Group may be unable to acquire rights to exploit
additional attractive mining properties on terms it considers
acceptable. Accordingly, there can be no assurance that the Group
will acquire any interest in additional operations that would yield
reserves or result in commercial mining operations. The Company
expects to undertake sufficient due diligence where warranted to
help ensure opportunities are subjected to proper evaluation.
Funding risk
In the past the Group has raised funds via equity contributions
from new and existing shareholders, thereby ensuring the Group
remains a going concern until such time that revenues are earned
through the sale or development and mining of a mineral deposit.
There can be no assurance that such funds will continue to be
available on reasonable terms, or at all in future. The Directors
regularly review cash flow requirements to ensure the Group can
meet financial obligations as and when they fall due.
The Group currently generates no revenue and had net assets of
GBP121,876 as at 31 December 2020 (31 December 2019: GBP177,714).
As at year end, the Group had liquid assets in the form of cash and
cash equivalent and other financial asset balances receivable of
GBP97,777 and GBP46,405 respectively.
The Directors have reviewed budgets, projected cash flows and
other relevant information, and on the basis of this review and the
below, they are confident that the Company and the Group will have
adequate financial resources to continue in operational existence
for the foreseeable future.
The Group has sufficient funds for its present working capital
requirements for the foreseeable future due to the successful
capital raising completed post year end, as further expended on in
note 7. The Directors though continue to review the Group's options
to secure additional funding for its general working capital
requirements, alongside its ongoing review of potential acquisition
targets and corporate development needs. The Directors are
confident in this light that such funding will be available,
although there is no guarantee as to the terms of such funding or
that such funding will be available. In addition, any equity
funding may be subject to shareholder approvals in line with legal
and regulatory requirements as appropriate. As a result, the
Directors continue to monitor and manage the Group's cash and
overheads carefully in the best interests of its shareholders.
Whilst the Directors continue to consider it appropriate to
prepare the financial statements on a going concern basis the above
constitutes a material uncertainty that shareholders should be
aware of.
COVID-19 Update
Subsequent to year end, there has been a gradual easing of
COVID-19 related restrictions throughout the areas in which the
Group operates, resulting in an increase in mobility and
operational activities both in Tanzania and South Africa. With the
roll-out of the vaccination programs continuing in various
jurisdictions in which the Group operates, it is expected that the
impact of COVID-19 in the 2021 financial year will gradually
subside to a point where operational activities will return to what
will be the new normal going forward.
The safety and wellbeing of Katoro's employees and contractors
is the highest priority for the Company at this time. Accordingly,
in response to the COVID-19 pandemic, and in line with government
guidelines, a business continuity programme has been put in place,
where employees are being asked to work from home, and limit
travel.
The situation and guidance being given in respect of COVID-19 is
an evolving one, which the Board will continue to actively
monitor.
In this unprecedented time, it is our priority and
responsibility to ensure the safety of our team. We will continue
to provide updates on our business and operations as necessary.
Finally, we would like to take this opportunity to send our very
best wishes to all during this difficult time.
Commercial risk
The mining industry is competitive and there is no assurance
that, even if commercial quantities of minerals are discovered, a
profitable market will exist for the sale of such minerals. There
can be no assurance that the quality of the minerals will be such
that the Group properties can be mined at a profit. Factors beyond
the control of the Group may affect the marketability of any
minerals discovered. Mineral prices are subject to volatile price
changes from a variety of factors including international economic
and political trends, expectations of inflation, global and
regional demand, currency exchange fluctuations, interest rates and
global or regional consumption patterns, speculative activities and
increased production due to improved mining and production methods.
Ultimately, the Group expects that prior to a development decision;
a project would be the subject of a feasibility analysis to ensure
there exists an appropriate level of confidence in its economic
viability.
Operational risk
Mining operations are subject to hazards normally encountered in
exploration, development and production. These include unexpected
geological formations, rock falls, flooding, dam wall failure and
other incidents or conditions which could result in damage to plant
or equipment or the environment and which could impact any future
production throughout. Although it is intended to take adequate
precautions to minimise risk, there is a possibility of a material
adverse impact on the Group's operations and its financial results.
The Company will develop and maintain policies appropriate to the
stage of development of its various projects.
Staffing and Key Personnel Risks
Recruiting and retaining qualified personnel is critical to the
Group's success. The number of persons skilled in the acquisition,
exploration and development of mining properties is limited and
competition for such persons is intense. While the Company has good
relations with its employees, these relations may be impacted by
changes in the scheme of labour relations which may be introduced
by the relevant governmental authorities. Adverse changes in such
legislation may have a material adverse effect on the Group's
business, results of operations and financial condition. Staff are
encouraged to discuss with management matters of interest to the
employees and subjects affecting day-to-day operations of the
Group.
Speculative Nature of Mineral Exploration and Development
In addition to the above there can be no assurance that the
current exploration programmes will result in profitable mining
operations.
The recoverability of the carrying value of exploration and
evaluation assets is dependent on the successful discovery of
economically recoverable reserves, the achievement of profitable
operations, and the ability of the Group to raise additional
financing, if necessary, or alternatively upon the Company's
ability to dispose of its interests on an advantageous basis.
Changes in market conditions could require material write downs of
the carrying value of the Group's assets.
Development of the Group's mineral exploration properties is,
amongst others, contingent upon obtaining satisfactory exploration
results and securing additional adequate funding. Mineral
exploration and development involves substantial expenses and a
high degree of risk, which even a combination of experience,
knowledge and careful evaluation may not be able to adequately
mitigate. The degree of risk reduces substantially when a Group's
properties move from the exploration phase to the development
phase.
The discovery of mineral deposits is dependent upon a number of
factors including the technical skill of the exploration personnel
involved. The commercial viability of a mineral deposit, once
discovered, is also dependent upon a number of factors, including
the size, grade and proximity to infrastructure, metal prices and
government regulations, including regulations relating to
royalties, allowable production, importing and exporting of
minerals, and environmental protection. In addition, several years
can elapse from the initial phase of drilling until commercial
operations are commenced.
Political Stability
The Company is conducting its activities in Tanzania and South
Africa. The Directors believe that the Governments of Tanzania and
South Africa support the development of natural resources by
foreign investors and the Directors actively monitor the situation
on an ongoing basis. However, there is no assurance that future
political and economic conditions in Tanzania and South Africa will
not result in the respective governments adopting different
policies regarding foreign development and ownership of mineral
resources. Any changes in policy affecting ownership of assets,
taxation, rates of exchange, environmental protection, labour
relations, repatriation of income and return of capital, may affect
the Company's ability to develop the projects.
Uninsurable Risks
The Group may become subject to liability for accidents,
pollution and other hazards against which it cannot insure or
against which it may elect not to insure because of prohibitive
premium costs or for other reasons, such as amounts which exceed
policy limits.
Foreign investment risks including increases in taxes, royalties
and renegotiation of contracts
The Group is subject to risk arising from the ever-changing
economic environment in which its subsidiaries operate, mainly
driven by the changing regulatory environment governing corporate
taxation, transfer pricing and other investment related operational
activities. The Group continues to re-assess its investment
decisions in order to limit exposure to the ever-changing
regulatory environment in which it operates.
Section 172(1)(a) to (f) of the Companies Act 2006 requires each
director to act in the way he or she considers would be most likely
to promote the success of the company for the benefit of its
members as a whole, with regard to the following matters:
a. The likely consequences of any decision in the long-term
Katoro is a mining exploration and development company. By their
natures mining exploration and development projects are complex,
capital intensive, last many years and involve a varied group of
stakeholders. As such it is extremely important that the board
considers all decisions made by the company in the context of their
long-term impact on the company. Consequences of such decisions
include (but are not limited to) the impact on all stakeholders
(with particular care towards local communities), impact on
environmental issues in and around project areas and the financial
impact on the Company and its ability to function effectively.
Katoro Gold is meticulous in its planning, as is required for
permitting processes in the mining exploration and development
sector. As such, the Company prepares detailed planning documents
before initiating any major work programme. Such planning documents
assess a variety of factors from community and environmental issues
to technical geological and project funding matters. Where
appropriate the Company provides copies of these reports on its
website ( www.katorogold.com ) or releases excerpts via the London
Stock Exchange's Regulatory News Service.
b. The interests of the company's employees
The health and safety of Katoro Gold's employees is of paramount
concern to the board. It is imperative that Katoro Gold provides a
safe and secure working environment for all staff. The Company
conducts regular Health & Safety reviews and ensures that any
operational plans are subject to rigorous scrutiny in their
creation and constant monitoring during their implementation.
The Company is a responsible employer in respect to the approach
it takes towards employee pay and benefits. These are constantly
reviewed.
c. The need to foster the company's business relationships with
suppliers, customers and others
Mining exploration and development projects involve a diverse
and varied group of stakeholders. These include (but is not limited
to) the Company's employees, government officials, local
communities, financial backers, shareholders and other suppliers.
The Company adopts a transparent and open stance in its dealings
with all stakeholders to help build trust. Mining exploration and
development projects can only succeed with the full support of all
involved.
The board has oversight of the procurement and contract
management processes in place and receives regular updates on any
matters of significance, as well as approving the awarding of large
contracts. The board ensures the company fully adheres to the
Bribery Act 2010.
d. The impact of the company's operations on the community and environment
Mining exploration and development projects can have a
significant impact on local communities and the environment. The
board constantly reviews the impact of its operations on local
communities and the environments. Where required, the Company
completes detailed surveying work (such as Environmental Impact
Assessments) and, where necessary, applies for relevant permits.
Such processes require diligence and concentrated effort.
The board ensures it maintains positive relations with local
communities, by engaging in local programmes and providing secure
employment opportunities.
e. The desirability of the company maintaining a reputation for
high standards of business conduct
As a listed Plc, Katoro Gold's reputation for the high standards
of its business conduct is paramount. The board makes every effort
to ensure it maintains these.
The Company is subject to the disclosure requirements of the AIM
Rules for Companies and Financial Conduct Authority's Disclosure
Transparency Rules. These comprehensive set of rules enforce a
strict discipline upon the Company in terms of the manner,
timeliness, subjectivity and content of its public disclosures.
Katoro Gold is also required to complete an annual audit. This
is a rigorous analysis of the company's operations and review of
the company's policies. The results of this are published each year
in the Company's Annual Report.
Katoro Gold also publishes on its website an "AIM 26 Disclosure"
( https://katorogold.com/investors/aim-rule-26 ), which details
much of the manner in which the Company is run.
Katoro Gold is committed to corporate governance and adheres to
the QCA Corporate Governance Code. The Company's corporate
governance statement can be found here -
https://katorogold.com/wp-content/uploads/2018/10/QCA-Statement.pdf.
f. The need to act fairly as between members of the company
As a listed company, Katoro Gold is committed to treating its
shareholders fairly and delivering shareholder value.
Katoro Gold is registered in England and Wales and is subject to
the Companies Act. The Company is also subject to the UK City Code
on Takeovers and Mergers. The Company's articles of association,
which help define some of the actions between the Company and its
shareholders, can be found here
https://katorogold.com/investors/corporate-documents/
Condensed Consolidated Financial Results for the year ended 31
December 2020
Condensed Consolidated Statement of Comprehensive Income
GROUP
------------------------
31 December 31 December
2020 2019
----------- -----------
Audited Audited
----
Note GBP GBP
----
Revenue - -
Administrative expenses (894,872) (514,220)
Share based payment transactions (225,778) (91,597)
Foreign exchange (losses)/gain (76,889) 1,649
Exploration expenditure (1,394,715) (102,152)
Operating loss (2,592,254) (706,320)
Other income 43,873 37,661
Finance income 9,570 -
Finance costs (22,303) -
Loss on ordinary activities before tax (2,561,114) (668,659)
Taxation - -
----------- -----------
Loss for the period (2,561,114) (668,659)
Other comprehensive loss:
Items that may be classified subsequently to
profit or loss:
Exchange differences on translation of foreign
operations (9,266) 4,582
Gain reclassified to profit or loss on disposal
of foreign operation 121,670 -
Other comprehensive loss for the period net
of tax (112,404) 4,582
Total comprehensive loss for the period (2,448,710) (664,077)
----------- -----------
Loss for the period (2,561,114) (668,659)
----------- -----------
Attributable to the owners of the parent (2,437,234) (661,902)
Attributable to non-controlling interest (123,880) (6,757)
----------- -----------
Total comprehensive loss for the period (2,448,710) (664,077)
----------- -----------
Attributable to the owners of the parent (2,324,830) (658,465)
Attributable to non-controlling interest (123,880) (5,612)
----------- -----------
Basic and diluted loss per share (pence) 3 (0.91) (0.39)
Condensed Consolidated Statement of Financial Position
GROUP
31 December 31 December
2020 2019
----------- -------------------
Audited Audited
---- ----------- -------------------
Note GBP GBP
---- ----------- -------------------
Assets
Non-Current Assets
Intangible assets 209,500 209,500
Investments - 37,661
Other financial assets - -
----------- -------------------
209,500 247,161
----------- -------------------
Current Assets
Cash and cash equivalents 97,777 27,972
Other receivables 46,405 13,017
Other financial assets - -
Assets classified as held for sale - 6,966
Total current assets 144,182 47,955
----------- -------------------
Total Assets 353,682 295,116
=========== ===================
Equity and Liabilities
Equity
Called up share capital 5 3,286,982 1,795,555
Share premium account 2,472,725 2,216,729
Merger Reserve 1,271,715 1,271,715
Capital Contribution 10,528 10,528
Warrant and Share based payment reserve 750,912 105,467
Translation Reserve (338,844) (451,250)
Retained earnings reserve (7,262,707) (4,804,302)
----------- -------------------
Equity attributable to owners of the parent 191,311 144,442
Non-controlling interest (69,435) 33,272
----------- -------------------
Total Equity 121,876 177,714
----------- -------------------
Liabilities
Current Liabilities
Trade and other payables 2 173,651 106,145
Other financial liabilities 58,155 -
Liabilities directly associated with assets
held for sale - 11,257
Total Current Liabilities 231,806 117,402
=========== ===================
Total Equity and Liabilities 353,682 295,116
Condensed Consolidated Statement of Changes in Equity
Share Share Warrant Merger Foreign Capital Retained Non-controlling Total
capital premium and reserve currency contribution deficit interest equity
Share translation
based reserve
payment
reserve
-------------- --------- ---------- ------- --------- ----------- ------------ ----------- --------------- -----------
GBP GBP GBP GBP GBP GBP GBP GBP
-------------- --------- ---------- ------- --------- ----------- ------------ ----------- --------------- -----------
Balance as at
1 January
2020 1,795,555 2,216,729 105,467 1,271,715 (451,250) 10,528 (4,804,302) 33,272 177,714
--------- ---------- ------- --------- ----------- ------------ ----------- --------------- -----------
Loss for the
year - - - - - - (2,437,232) (123,880) (2,561,112)
Other
comprehensive
loss - - - - (9,264) - - - (9,264)
Issue of share
capital 1,491,427 255,996 - - - - - - 1,747,423
Share warrants
and options - - 645,445 - - - - - 645,445
Disposal of
interest in
subsidiary
without
losing
control - - - - - - (21,173) 21,173 -
Disposal of
interest in
subsidiary - - - - 121,670 - - - 121,670
Balance as at
31 December
2020 3,286,982 2,472,725 750,912 1,271,715 ( 338,844) 10,528 (7,262,707) (69,435) (121,876)
========= ========== ======= ========= =========== ============ =========== =============== ===========
Balance as at
1 January
2019 1,494,478 2,186,406 41,808 1,271,715 (455,832) 10,528 (4,102,371) - 446,732
========= ========== ======= ========= =========== ============ =========== =============== ===========
Loss for the
year - - - - - - (661,902) (6,757) (668,659)
Other
comprehensive
loss - - - - 4,582 - - - 4,582
Issue of share
capital 301,077 30,323 - - - - - - 331,400
Issue of share
warrants and
options - - 63,659 - - - - - 63,659
Disposal of
interest in
subsidiary
without
losing
control - - - - - - (40,029) 40,029 -
Balance as at
31 December
2019 1,795,555 2,216,729 105,467 1,271,715 (451,250) 10,528 (4,804,302) 33,272 177,714
========= ========== ======= ========= =========== ============ =========== =============== ===========
Condensed Consolidated Statement of Cash Flow
GROUP
------------------------
31 December 31 December
2020 2019
----------- -----------
Audited Audited
GBP GBP
Cash flows from operating activities
Loss for the period before taxation (2,561,114) (668,659)
Adjustments for:
Foreign exchange loss/(gain) 99,828 1,649
Share based payment transactions 225,778 91,597
Directors shares issued as part of capital
placing 50,090 -
Liabilities settled through the issue of equity (4,200) 103,461
Profit on sale of subsidiary (43,873) -
Investment obtained for no consideration - (37,661)
Impairments of other financial assets 1,160,337 -
Increase in other receivables (33,387) (58,097)
Increase/(Decrease) in trade and other payables 67,506 (13,017)
(1,039,035) (580,727)
----------- -----------
Cash flows from investing activities
Advances of other financial assets (1,122,676) -
Proceed received from sale of Subsidiary 76,716 -
Proceeds from sale of subsidiary without loss
of control 25,000 -
Cash and cash equivalents disposed of due to
sale of Subsidiary (6,966) -
----------- -----------
Net cash proceeds from investing activities (1,027,925) -
----------- -----------
Cash flows from financing activities
Issue of shares (net of share issue cost) 1,337,000 202,934
Proceeds from convertible loan note 792,800 -
Net cash proceeds from financing activities 2,129,800 202,934
----------- -----------
Net increase/(decrease) in cash 62,839 (377,793)
Cash and cash equivalents at the start of the
financial period 34,938 412,731
Cash and cash equivalents at the end of the
financial period 97,777 34,938
=========== ===========
Cash and cash equivalents is held as follows:
Group companies 97,777 27,972
Assets classified as held for sale - 6,966
Condensed Consolidated financial results for the year ended 31
December 2019
Note 1 General Information
Katoro Gold PLC ("Katoro" or the "Company") is a company
incorporated in England & Wales as a public limited company.
The Group financial statements consolidate those of the Company and
its subsidiaries (together referred to as the "Group"). The
Company's registered office is located at 60 Gracechurch Street,
London EC3V 0HR.
The principal activities of the Group are related to the
evaluation and exploration studies within a licenced portfolio area
with a view to generating commercially viable mineral
resources.
The Company has taken advantage of Section 408 of the Companies
Act 2006 and has not included a Company only Profit and Loss
Account in these Financial Statements. The loss attributable to
members of the Company for the year ended 31 December 2020 is
GBP2,088,762 (2019: GBP668,659).
Going Concern
In the past the Group has raised funds via equity contributions
from new and existing shareholders, thereby ensuring the Group
remains a going concern until such time that revenues are earned
through the sale or development and mining of a mineral deposit.
There can be no assurance that such funds will continue to be
available on reasonable terms, or at all in future. The Directors
regularly review cash flow requirements to ensure the Group can
meet financial obligations as and when they fall due.
The Group currently generates no revenue and had net assets of
GBP121,876 as at 31 December 2020 (31 December 2019: GBP177,714).
As at year end, the Group had liquid assets in the form of cash and
cash equivalent and other financial asset balances receivable of
GBP97,777 and GBP46,405 respectively. The Group further improved
its liquid assets position post year-end following from the
successful capital raising as further expended on in note 7.
The Directors have reviewed budgets, projected cash flows and
other relevant information, and on the basis of this review and the
below, they are confident that the Company and the Group will have
adequate financial resources to continue in operational existence
for the foreseeable future.
The Group has sufficient funds for its present working capital
requirements for the foreseeable future due to the successful
capital raising completed post year end, as further expended on in
note 21. The Directors though continue to review the Group's
options to secure additional funding for its general working
capital requirements, alongside its ongoing review of potential
acquisition targets and corporate development needs. As the group
and company is likely to require additional finance in order to
progress work on its current assets and bring them to commercial
development and cash generation. Such development are dependent on
successful explorations and technical reports and then on securing
of further funding. The Directors are confident in this light that
such funding will be available, although there is no guarantee as
to the terms of such funding or that such funding will be
available. In addition, any equity funding may be subject to
shareholder approvals in line with legal and regulatory
requirements as appropriate. As a result, the Directors continue to
monitor and manage the Company's cash and overheads carefully in
the best interests of its shareholders.
Whilst the Directors continue to consider it appropriate to
prepare the financial statements on a going concern basis the above
constitutes a material uncertainty that shareholders should be
aware of.
Note 2 Trade and other payables
31 Dec 2020 31 Dec 2019
GBP GBP
------------ ------------
Trade payables 21,738 13,619
Accruals 151,914 92,526
------------ ------------
173,652 106,145
------------ ------------
Note 3 Earnings per share
The calculation of loss per share is based on the following loss
and number of shares:
31 Dec 2020 31 Dec 2019
GBP GBP
-------------- ------------
Loss for the period from
continuing operations (2,437,234) (661,902)
-------------- ------------
Basic and diluted number
of shares 268, 475, 455 168,054,153
-------------- ------------
Basic and diluted loss
per share (pence) (0.91) (0.39)
The Group presents basic and diluted EPS data on the basis that
the current structure has always been in place. Therefore the
number of Katoro shares in issue as at the period end has been used
in the calculation. Basic loss per share is calculated by dividing
the loss for the period from continuing operations of the Group by
the weighted average number of shares in issue during the
period.
Katoro has no dilutive instruments in existence.
Note 4 Audited results
These condensed consolidated financial results have been
extracted from the audited financial statements but are not itself
audited.
Note 5 Share Capital
The called-up and fully paid share capital of the Company is as
follows:
31 Dec 2020 31 Dec 2019
GBP GBP
------------ ------------
Allotted, called-up and
fully paid: 328,698,305
(2018: 179,555,462) 3,286,982 1,795,555
------------ ------------
A reconciliation of share capital is set out below:
Allotted,
called-up
and fully
Number of paid
shares GBP
------------ ------------
As at 1 January 2020 179,555,462 149,447,825
Shares issued during the period 149,142,843 30,107,637
At 31 December 2020 328,698,305 179,555,462
------------ ------------
On 14 February 2020, Kibo Energy PLC ('Kibo'), the Company's
majority shareholder, and clients of SI Capital, the Company's
broker, who both participated in the October 2019 fundraise, have
exercised warrants over 1,800,000 and, 3,000,000 Warrant Shares
respectively.
On 25 February 2020, Sanderson has elected to immediately
convert an initial GBP100,000 of the GBP400,000 drawn under the
Sanderson Convertible Loan Note ('CLN') ; as a result the Company
has issued Sanderson with 6,666,667 new Ordinary Shares.
On 04 March 2020, Sanderson has elected to convert the remaining
GBP300,000 of the GBP400,000 drawn under the Sanderson CLN; as a
result the Company has issued Sanderson with 20,000,000 new
Ordinary Shares.
On 31 March 2020, GBP215,000 was raised through the issue of
17,200,000 shares of GBP0.01 each.
On the 19 May 2020, the company had received notices from
certain clients of SI Capital, the Company's broker, who
participated in the January 2020 CLN to convert, in aggregate; over
GBP293,000 principal value of the CLN as a result the Company has
issued 20,928,564 new ordinary shares.
On the 8 June 2020, the company had received further notices
from certain clients of SI Capital, the Company's broker, who
participated in the January 2020 CLN to convert, in aggregate; over
GBP17,000 principal value of the CLN as a result the Company has
issued 1,214,284 new ordinary shares.
On 25 June 2020, GBP1.1m (gross) was raised through the issue of
73,333,333 shares of GBP0.01 each.
On the 17 November 2020, the company had received further
notices from certain clients of SI Capital, the Company's broker,
who participated in the January 2020 CLN to convert, in aggregate;
over GBP60,000 principal value of the CLN as a result the Company
has issued 4,285,713 new ordinary shares.
Note 6 Board of Directors
There were no changes to the board of directors during the
interim period, or any other committee's composition.
Note 7 Subsequent events
Results of General Meeting
On 15 January 2021, the Company held a general meeting where the
following resolutions were approved by the shareholders eligible to
vote thereon:
- authority to the directors to allot new Ordinary Shares up to
an aggregate nominal amount of GBP2,000,000 which includes the
issue of Ordinary Shares pursuant to the Placing and Subscription
of 48,000,000 ordinary share for the amount of GBP960,000; and
- authority to issue equity securities up to an aggregate
nominal amount of GBP2,000,000 for cash, including the Ordinary
Shares pursuant to the Placing and Subscription of 48,000,000
ordinary share for the amount of GBP960,000.
Exercise of warrants
On the 9 March 2021, there was an exercise warrants, in
aggregate, over 1,000,000 ordinary shares of 1 pence in the Company
at an exercise price of 1.5 pence (the 'Warrant Shares'). All
funds, amounting to, in aggregate, GBP15,000, from the exercise of
the warrants have been received by the Company and will be used for
general working capital purposes.
Credit Loan Note Conversion and Final Settlement
The Company has received further notices from certain clients of
SI Capital, the Company's broker, who participated in the January
2020 Convertible Loan Note program to convert, in aggregate,
GBP17,000 in principal value at a conversion price of 1.4 pence per
share. As a result, the Company issued the 1,214,285 new ordinary
shares of 1 pence each in the Company and following the conversion,
the Convertible Loan Note program will have been settled in full
with no principal outstanding balance remaining. The CLN accrues
interest at 20% per annum on a daily basis and the total accrued
interest relating to the foregoing conversions amount to
GBP3,390.68 which has been settled in cash.
Note 8 Going concern
The Group currently generates no revenue and has net assets of
GBP121,876 at 31 December 2020.
After reviewing the Group's financial projections, the directors
have a reasonable expectation that the Group will have adequate
resources to continue in operational existence for the foreseeable
future. For this reason, they adopted the going concern basis in
preparing the consolidated financial results.
Note 9 Commitments and contingencies
There are no material contingent assets or liabilities as at 31
December 2020.
Note 10 Segment report
Segmental disclosure per category
Mining Corporate Total
2020
Loss after tax (1,643,217) (917,896) (2,561,114)
Segmental assets 245,457 108,225 353,682
Segmental liabilities 94,071 137,735 231,806
2019
Loss after tax (357,181) (311,478) (668,659)
Segmental assets 237,189 57,927 295,116
Segmental liabilities 54,751 62,651 117,402
Segmental disclosure per geographical location
Tanzania Cyprus UK South Total
Africa
2020
Loss after
tax (95,834) (351,941) (917,897) (1,195,442) (2,561,114)
Segmental
assets 225,449 2,667 108,225 17,341 353,682
Segmental
liabilities 33,717 59,830 137,735 524 231,806
2019
Loss after
tax (134,816) (222,365) (311,478) - (668,659)
Segmental
assets 220,618 16,571 57,927 - 295,116
Segmental
liabilities 20,701 34,050 62,651 - 117,402
**ENDS**
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