TIDMKAT
RNS Number : 6785Z
Katoro Gold PLC
16 September 2022
Katoro Gold plc
(Incorporated in England and Wales)
(Registration Number: 9306219
Share code on the AIM: KAT
ISIN: GB00BSNBL022
("Katoro" or "the Company")
Unaudited Interim results for the six months ended 30 June
2022
Dated 16 September 2022
Katoro Gold plc ('Katoro' or the 'Company') (AIM: KAT), the
AIM-listed gold and nickel exploration and development compa ny, is
pleased to announce its unaudited interim results for the six
months ended 30 June 2022. The interim results will also shortly be
available on the Company's website: https://www.katorogold.com/
Overview
-- Successful completion of drill program on Haneti Nickel
project, including an exploration update (see RNS dated 31 May
2022)
-- Katoro Gold has signed a Joint Venture Agreement with Lake
Victoria Gold for its Imweru Gold Project
-- Various new projects currently under assessment, with some at
an advanced stage of discussion
This announcement contains inside information as stipulated
under the Market Abuser Regulations (EU) no. 596/2014.
****
For further information, please visit www.katorogold.com or
contact:
Louis Coetzee Katoro Gold plc Executive Chairman louisc@katorogold.com
Bhavesh Patel
Andrew Thompson RFC Ambian Ltd Nominated Adviser +44 20 3440 6800
--------------------- ----------------------- ------------------------------
Nick Emerson
Sam Lomanto SI Capital Ltd Broker +44 14 8341 3500
--------------------- ----------------------- ------------------------------
Zainab Slemang Lifa Communications Investor and Public zainab@lifacommunications.com
van Rijmenant Relations Consultant
--------------------- ----------------------- ------------------------------
Chairman's Statement
Introduction
After two years of pandemic conditions, the world has opened up
to trade, travel and more. This is despite the ongoing war in
Ukraine, rising inflation and increased interest rates adding to
uncertainty on all fronts. At the same time, economic activity
remains high and this has led to Katoro Gold making significant
progress with its ongoing projects in the first half of 2022. In
particular, the Company has successfully completed its drill
program on its Haneti Nickel project ('Haneti'), on which it
released an exploration update in a Company RNS dated 31 May 2022.
The Company has furthermore signed a Joint Venture Agreement
('JVA') for its Imweru Gold Project ('Imweru', see further details
below).
Haneti Project and Babayu Lithium Prospect
The Haneti Project is a Joint Venture ('JV') with Power Metals
Resources PLC (LON: POW), which holds a 35% interest in the project
while Katoro holds 65%. The project covers a vast prospective area
in central Tanzania, with a principal target zone of an
80-kilometre ultra-mafic belt of potential nickel and traces of
combined platinum group metals ('PGMs').
On 14 February 2022, the Company announced the completion of the
diamond drill programme that was carried out at Haneti. A total of
900.04 metres were completed across three drill holes with core
logging and sampling prepared for thin section petrographic
analysis and laboratory assay testing for nickel, platinum,
palladium, cobalt, chromium and gold at SGS Tanzania. The drill
programme provided considerable geological information that enabled
the Company to refine the geological modelling for next-stage work.
This, as well as the results of the drill programme, which suggests
that the platinum-group element ('PGE') potential is limited to
serpentinite units, and that nickel and copper mineralisation
should preferentially be targeted within the intrusive gabbro
units, were detailed in an RNS dated 31 May 2022.
The same RNS provides clarification of the Babayu Lithium
Prospect ('Babayu'), of which rock samples were taken in tandem
with the diamond-drilling campaign at Haneti. Babayu is located
approximately 40 kilometres southwest of Haneti. The results from
the samples confirm significant lithium and tantalum potential at
Babayu, and both this and the results at Haneti have enabled the
Company to re-engage with potential project partners. Additionally,
license applications have been made in respect of the lithium
prospective areas and the JV is in the process of implementing a
lithium consolidation strategy to include and review existing and
potential partnerships with local license holders.
Imweru Gold Project
The Company has entered into a JVA with Lake Victoria Gold
('LVG') for the further development of its Imweru Gold Project,
which it previously announced the disposal of in a Company RNS
dated 12 June 2020. Due to administrative and statutory barriers
related to the transfer of ownership at project level, as well as
the issue of relevant convertible loan notes ('CLN'), the Company
agreed to cancel the sale transaction of the project to LVG and the
two entered into a JV instead. The JVA will see LVG earn up to 80%
in the Imweru project with 20% held by Katoro as a carried
interest.
Further to this, all debt funding required by the JV will be
procured and/or provided by LVG, with the JV reimbursing Katoro for
previous expenditures to the amount of EUR792,000 on or before 31
December 2023. LVG is also developing the Imwelo Gold Project,
located adjacent to Imweru, and this JVA allows for a more
significant economic project that will attract suitable funding to
accelerate the development and exploitation of a combined gold
mining project.
Future Outlook
Moving into the second half of 2022, Katoro Gold is in the
process of assessing various new projects to further diversify its
portfolio and unlock value-based opportunities that align with its
strategy of being a preeminent African-focused gold and mineral
exploration and development company. At present, the Company is
already in advanced discussions with a number of parties with
regard to the new projects under assessment.
Principle Risk
Refer to Note 15 of the RNS for our assessment of the principal
risks.
Conclusion
I remain optimistic about the Company's prospects into the
second half of the year. As such, I thank the directors and
management team of Katoro Gold for their dedication and hard work
throughout this period.
Louis Coetzee
Executive Chairman
Unaudited Interim Results for the six months ended 30 June
2022
Unaudited condensed consolidated interim Statement of
Comprehensive Income
For the six months ended 30 June 2022
6 months to 12 months to 6 months to
Note 30 June 31 December 30 June
2022 2021 2021
(Unaudited) (Audited) (Unaudited)
GBP GBP GBP
Revenue - - -
Cost of sales - - -
------------ ------------- ------------
Gross Profit - - -
------------ ------------- ------------
Administrative expenses (422,441) (689,396) (341,987)
Foreign exchanges gain/(loss) 60,714 15,471 69
Share based payment transactions 7 - (195,241) (162,700)
Exploration expenditure (278,645) (284,463) (279,092)
Operating profit/loss (640,372) (1,153,629) (783,710)
------------ ------------- ------------
Other Income 13 142,045 1,029 -
Finance Income 15,152 10,121 11,919
------------ ------------- ------------
Profit/(loss) before Tax (483,175) (1,142,479) (771,791)
------------ ------------- ------------
Tax - - -
------------ ------------- ------------
Profit/(loss) for the period (483,175) (1,142,479) (771,791)
------------ ------------- ------------
Other comprehensive Income/(loss):
Exchange differences on translating of foreign operations 105,383 (2,162) (16,456)
Total Comprehensive Income/(loss) (483,175) (1,144,641) (788,247)
Profit/(loss) for the period (483,175) (1,142,479) (771,791)
Attributable to owners of the parent (374,078) (1,062,598) (770,161)
Attributable to non-controlling interest (109,097) (79,881) (1,630)
------------ ------------- ------------
Total comprehensive Income/(loss) (377,792) (1,144,641) (788,247)
Attributable to owners of the parent (268,695) (1,080,669) (78,617)
Attributable to non-controlling interest (109,097) (79,881) (1,630)
------------ ------------- ------------
Earnings/(loss) Profit per share
Basic and diluted Earnings/(loss) per share (pence) 4 (0.08) (0.27) (0.21)
Unaudited condensed consolidated interim Statement of Financial
Position
As at 30 June 2022
6 months to 12 months to 6 months to
30 June 31 December 30 June
Note 2022 2021 2021
(Unaudited) (Audited) (Unaudited)
GBP GBP GBP
Assets
Non-current assets
Intangible assets 8 209,500 209,500 209,500
Investments in equity instruments 13 182,301 - -
------------ ------------- ------------
391,801 209,500 209,500
------------ ------------- ------------
Current assets
Cash and cash equivalents 342,481 827,956 420,860
Other receivables 21,002 48,702 23,104
Other financial assets 13 - - -
------------ ------------- ------------
Total current assets 363,483 876,658 443,964
------------ ------------- ------------
Total Assets 755,284 1,086,158 653,464
------------ ------------- ------------
Equity
Called up share capital 6 4,604,125 4,604,125 3,789,125
Share premium 2,905,532 2,962,582 2,823,382
Capital contribution reserve 10,528 10,528 10,528
Translation reserve (251,532) (356,915) (355,300)
Merger reserve 1,271,715 1,271,715 1,271,715
Warrant and share-based payment reserve 7 946,153 946,153 985,612
Retained deficit (8,756,433) (8,382,355) (8,032,868)
------------ ------------- ------------
Reserves attributable to owners 730,088 1,055,833 492,194
Minority interest (242,504) (133,407) (71,065)
------------ ------------- ------------
Total Equity 487,584 922,426 421,129
------------ ------------- ------------
Liabilities
Current liabilities
Trade and other payables 3 82,921 88,452 232,335
Other financial liabilities 14 184,779 75,280 -
------------ ------------- ------------
Total current liabilities 267,700 163,732 232,335
------------ ------------- ------------
Total Equity and Liabilities 755,284 1,086,158 653,464
------------ ------------- ------------
Unaudited Condensed Consolidated Statement of Changes in
Equity
Share Share Warrant Merger Capital Foreign Retained Minority Total
Capital Premium reserve Reserve Contribution currency deficit interest
and Reserve translation
share reserve
based
payment
reserve
GBP GBP GBP GBP GBP GBP GBP GBP GBP
Balance at 31 December 2021
(audited) 4,604,125 2,962,582 946,153 1,271,715 10,528 (356,915) (8,382,355) (133,407) 922,426
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Loss for the period - - - - - - (374,078) (109,097) (483,175)
Other comprehensive loss -
exchange differences - - - - - 105,383 - - 105,383
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Proceeds of share issue of
share capital - (57,050) - - - - - - (57,050)
Balance as at 30 June 2022
(unaudited) 4,604,125 2,905,532 946,153 1,271,715 10,528 (251,532)) (8,756,433) (242,504) 487,584
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Balance at 1 January 2021
(audited) 3,286,982 2,472,725 750,912 1,271,715 10,528 (338,844) (7,262,707) (69,435) 121,876
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Loss for the period - (1,062,598) (79,881) (1,142,479)
Other comprehensive income -
exchange differences - - - - - (18,071) - 15,909 (2,162)
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Proceeds of share issue of
share capital 1,317,143 489,857 - - - - - - 1,807,000
Issue of share options and
share warrants - - 195,241 - - - - - 195,241
Costs relating to share
issue - - - - - - (57,050) - (57,050)
Balance at 31 December 2021
(audited) 4,604,125 2,962,582 946,153 1,271,715 10,528 (356,915) (8,382,355) (133,407) 922,426
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Balance at 31 December 2020
(audited) 3,286,982 2,472,725 750,912 1,271,715 10,528 (338,844) (7,262,707) (69,435) 121,876
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Loss for the period - - - - - - (770,161) (1,630) (771,791)
Other comprehensive loss -
exchange differences - - - - - (16,456) - - (16,456)
Proceeds of share issue of
share capital 502,143 350,657 - - - - - - 852,800
Issue of share options and
share warrants - - 234,700 - - - - - 234,700
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Balance as at 30 June 2021
(unaudited) 3,789,125 2,823,382 985,612 1,271,715 10,528 (355,300) (8,032,868) (71,065) 421,129
----------------------------- ---------- ---------- --------- ----------- ------------- ------------ ------------- ---------- ---------------
Unaudited condensed consolidated interim statement of cash
flow
For the six months ended 30 June 2022
6 months 12 months 6 months
to to to
30 June 31 December 30 June
2022 2021 2021
(Unaudited) (Audited) (Unaudited)
GBP GBP GBP
Profit/(loss) for the period
before taxation (377,793) (1,142,479) (771,791)
Adjusted for:
Foreign exchange (gain)/ loss (111,257) (23,253) (69)
Share based payment transactions - 195,241 162,700
Profit on disposal of subsidiaries (142,045) - -
Impairments of other financial
assets 71,002 142,106 83,532
Non-trade expenses not settled - -
------------ ------------ ------------
Operating income before working
capital changes (560,093) (828,385) (525,628)
Decrease/ (Increase) in trade
and other receivables 27,700 (2,297) 23,301
(Decrease)/ Increase in trade
and other payables (5,531) (85,198) 17,529
------------ ------------ ------------
Net cash outflows from operating
activities (537,924) (915,880) (484,798)
Cash flows from investing activities
Advances of other financial assets - (125,866) (83,532)
Advances to subsidiaries - - (9,597)
Advances to Reef Miners - - (6,790)
Net cash inflow/(outflow) from
investing activities - (125,866) (99,919)
Cash flows from financing activities
Issue of shares (net of share
issue costs) (57,050) 1,732,950 907,800
Proceeds from other financial
liabilities 109,499 38,975 -
------------ ------------ ------------
Net cash proceeds from financing
activities 52,449 1,771,925 907,800
Net increase in cash and cash
equivalents (485,475) 730,179 323,083
Cash and cash equivalents at beginning
of period 827,956 97,777 97,777
------------ ------------ ------------
Cash and Cash equivalents at
End of Period 342,481 827,956 420,860
------------ ------------ ------------
Notes to the unaudited condensed consolidated interim financial
statements
For the six months ended 30 June 2022
Note 1 General information
Katoro Gold plc ("Katoro" or the "Company") is incorporated in
England & Wales as a public limited company. The Company's
registered office is located at 60 Gracechurch Street, London EC3V
OHR.
The principal activity of Katoro, through its subsidiaries
(together the 'Group'), is to carry out evaluation and exploration
studies within a licenced portfolio area with a view to generating
commercially viable Mineral Resources, namely gold and nickel
mines. In Haneti, the Group has one nickel mining project, which
has mineral exploration licences currently held by Eagle
Exploration Ltd. In addition, in South Africa the Group has entered
into binding conditional agreement to form a 50/50 unincorporated
joint venture pertaining to gold tailing project.
The condensed interim consolidated financial statements do not
represent statutory accounts within the meaning of section 435 of
the Companies Act 2016.
The condensed consolidated financial statements of the Company
have been prepared in accordance with the Disclosure Guidance and
Transparency Rules of the Financial Conduct Authority and
Accounting Standard IAS 34, 'Interim Financial Reporting', as
adopted by the UK.
The interim report does not include all of the notes of the type
normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the
period ended 31 December 2021, which has been prepared in
accordance with UK-adopted IFRSs, and any public announcements made
by Kibo Energy Plc during the interim reporting period.
The condensed consolidated financial statements of the Group are
presented in Pounds Sterling, which is the functional and
presentation currency for the Group and its related
subsidiaries.
The condensed consolidated financial statements do not represent
statutory accounts within the meaning of section 435 of the
Companies Act 2016.
Accounting policies applied are consistent with those of the
previous financial period and annual report unless where new
standards became effective during the period and a newly adopted
accounting policy for Investments in equity instruments -
Associates.
The seasonality or cyclicality of operations does not impact on
the interim financial statements.
Investments in equity instruments - Associates
Associates are all entities over which the group has significant
influence but not control, generally accompanying a shareholding
between 20% and 50% of the voting rights. Investments in associates
are accounted for using the equity method of accounting.
Use of Estimates and Judgements
The preparation of these condensed interim consolidated
financial statements in conformity with IFRS requires management to
make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets, liabilities, income and expenses.
The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be
reasonable under the circumstances, the results of which form the
basis of making judgements about carrying values of assets and
liabilities that are not readily apparent from other sources.
In particular, there are significant areas of estimation,
uncertainty and critical judgements in applying accounting policies
that have the most significant effect on the amounts recognised in
the financial statements.
-- Valuation of share options and warrants;
-- Credit loss allowance for other financial assets; and
-- Valuation of mining licence in Kibo Nickel Ltd.
-- Valuation of investments in equity instruments -
associates.
Please refer to note 16 where the estimate for investment in
equity instruments - associates valuation is disclosed.
Note 2 Going concern
The Company currently generates no revenue and had net assets of
GBP487,584 as at 30 June 2022 (31 December 2021: GBP922,426 and 30
June 2021: GBP421,129).
The Group has adequate cash and cash equivalents (financial
resources) to ensure the Group is able to continue as a going
concern for the foreseeable future 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 Directors 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 Group and Company will require additional finance in order
to progress work on its current assets and bring them to commercial
development and cash generation.
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 3 Trade and other payables
30 June 2022 31 December 30 June 2021
2021
GBP GBP GBP
------------- ------------ -------------
Trade payables 82,921 26,417 122,897
Accruals 184,779 62,035 109,438
------------- ------------ -------------
267,700 88,452 232,335
------------- ------------ -------------
Note 4 Earnings per share
The calculation of loss per share is based on the following loss
and number of shares:
30 June 2022 31 December 30 June 2021
2021
GBP GBP GBP
------------- ------------ -------------
Profit/(loss) for the
period from continuing
operations (374,078) (1,062,598) (770,161)
------------- ------------ -------------
Weighted Average basic
and diluted number of
shares 460,412,590 388,524,723 373,931,716
------------- ------------ -------------
Basic and diluted Earnings/(loss)
per share (pence) (0.08) (0.27) (0.21)
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 Earnings/loss per share is calculated by
dividing the Profit/loss for the period from continuing operations
of the Group by the weighted average number of shares in issue
during the period.
The Company had in issue warrants and options at 30 June 2022,
the inclusion of such warrants and options in the weighted average
number of shares in issue would be anti-dilutive and therefore they
have not been included for the purpose of calculating the loss per
share.
Note 5 Unaudited results
These condensed consolidated interim financial results have not
been audited or reviewed by the Group's auditors.
Note 6 Share Capital
The called-up and fully paid share capital of the Company is as
follows:
30 June 31 December 30 June
2022 2021 2021
GBP GBP GBP
---------- ------------ ----------
Allotted, called-up and
fully paid: 4,604,125 4,604,125 3,789,125
---------- ------------ ----------
A reconciliation of share capital is set out below:
Number of Allotted,
shares called-up and
fully paid
GBP
------------ ---------------
At 1 January 2022 460,412,593 4,604,125
At 30 June 2022 460,412,593 4,604,125
------------ ---------------
Note 7 Warrant and Share based payment reserve
Warrants
The following reconciliation serves to summarise the composition
of the warrant reserve as at period end:
30 June 31 December 30 June
2022 2021 2021
GBP GBP GBP
-------- ------------ --------
Opening balance of warrant
reserve 494,597 494,597 494,597
Issue of warrants - - 72,000
494,597 494,597 566,597
-------- ------------ --------
Reconciliation of the quantity of warrants in issue:
30 June 31 December 30 June
2022 2021 2021
------------ ------------ ------------
Opening balance 194,574,999 70,274,999 70,274,999
Warrants exercised - (1,000,000) (1,000,000)
Warrants issued - 129,500,000 48,000,000
Warrants expired - (4,200,000) -
------------ ------------ ------------
194,574,999 194,574,999 117,274,999
------------ ------------ ------------
No warrants have been issued in the six-month period ended 30
June 2022.
Share Options
The following reconciliation serves to summarise the composition
of the share-based payment reserve as at period end:
30 June 31 December 30 June
2022 2021 2021
GBP GBP GBP
-------- ------------ --------
Opening balance of share-based
payment reserve 451,556 256,315 256,315
Vesting of share options - 195,241 162,700
-------- ------------ --------
451,556 451,556 419,015
-------- ------------ --------
Reconciliation of the quantity of Share options in issue:
30 June 31 December 30 June
2022 2021 2021
----------- ------------ -----------
Opening Balance 32,244,781 32,244,781 32,244,781
32,244,781 32,244,781 32,244,781
----------- ------------ -----------
During the current year no share options issued in August 2020
vested.
Note 8 Exploration and evaluation assets
Exploration and evaluation assets consist solely of separately
identifiable prospecting assets held by Kibo Nickel and its
subsidiaries.
The following reconciliation serves to summarise the composition
of intangible prospecting assets as at period end:
Reconciliation of exploration and evaluation
assets
GBP
--------
Carrying value as at 1 January 2021 209,500
--------
Carrying value as at 30 June 2021 209,500
--------
Carrying value as at 31 December 2021 209,500
--------
Carrying value as at 30 June 2022 209,500
--------
Haneti comprises tenements (prospecting licences, offers and
applications) prospective for nickel, platinum-group-elements and
gold. It covers an area of approximately 5,000 sq. km in central
Tanzania and forms a near contiguous project block. The project
area straddles the Dodoma, Kondoa and Manyoni districts all within
the Dodoma (Administrative) Region. The main prospective belt of
rocks within the project, the Haneti-Itiso Ultramafic Complex
(HIUC), is centred on the small town of Haneti, located 88
kilometres north of Tanzania's capital city Dodoma. The HIUC
sporadically crops out over a strike length of 80 kilometres with
most outcrop exposure occurring 15 kilometres east of Haneti
village where artisanal mining of the semi-precious mineral
chrysoprase (nickel stained chalcedonic quartz) is being carried
out at a few localities.
Note 9 Board of Directors
There were no changes to the board of directors during the
interim period, or any other committee's composition.
Note 10 Subsequent events
Blyvoor Joint Venture Project
During the preceding year, the board of directors were in the
process of seeking admission for the vending of its and the
counterparty's interest in the Joint Venture into a separate
company to be listed on the Standard List of the London Stock
Exchange plc. The funding process did not succeed, and the board is
currently considering its position and options in this matter.
Haneti Nickel
A desktop review of all historical exploration data is being
undertaken. The review will take into account the knowledge gained
from the 2022 Haneti diamond drilling campaign (the first ever
completed on the Project). The results are intended to further
improve and refine targeting for future exploration programmes on
the Project.
Just prior to Covid-19 restrictions a number of major and
mid-tier companies expressed an interest in Haneti and a key
requirement of their due diligence work was access to diamond drill
core for analysis. With that drill core now in hand the JV will be
engaging again with potential project partners.
Babayu Lithium
Additional liaison with the Tanzanian government regarding the
lithium licence applications within the broader Babayu and other
related areas. Further regional desktop studies focusing on the
lithium potential of the broader Dodoma area are to be conducted
with the aim of identifying further prospective target areas for
staking and other potential opportunities for further
investment.
Note 11 Commitments and contingencies
There are no material contingent assets or liabilities as at 30
June 2022.
Note 12 Segment report
Segmental disclosure per category
Mining Corporate Total
GBP GBP GBP
---------- ---------- ----------
30 June 2022
Loss after tax (352,077) (131,098) (483,175)
Segmental assets 244,817 510,467 755,284
Segmental liabilities 211,907 55,793 267,700
---------- ---------- ----------
30 June 2021
Loss after tax (369,842) (401,949) (771,791)
Segmental assets 217,519 435,945 653,464
Segmental liabilities 113,169 119,166 232,335
---------- ---------- ----------
Segmental disclosure per geographical location
Tanzania Cyprus UK South Total
Africa
GBP GBP GBP GBP GBP
---------- ---------- ------------ ---------- ----------
30 June
2022
Profit/(Loss)
after tax (282,130) 754,127 (1,036,269) (2,569) (566,841)
Segmental
assets 215,252 806,676 (293,922) 27,278 755.284
Segmental
liabilities
---------- ---------- ------------ ---------- ----------
30 June
2021
Loss after
tax (120,438) (131,894) (401,949) (117,509) (771,791)
Segmental
assets 214,705 996 435,945 1,818 653,464
Segmental
liabilities 9,553 102,117 119,166 1,499 232,335
---------- ---------- ------------ ---------- ----------
There are no notable changes from the prior interim report.
During the preceding interim period there was an addition of a new
geographical location in which the Group prospecting operation has
been initiated which is South Africa where the Group has entered
into binding conditional agreement to form a 50/50 unincorporated
joint venture pertaining to gold tailing project.
Note 13 Other financial assets
30 June 31 December 30 June
2022 2021 2021
GBP GBP GBP
---------- ------------ --------
Other financial assets consist
of:
Lake Victoria Gold 656,283 657,061 -
Impairment (656,283) (657,061) -
---------- ------------ --------
- - -
---------- ------------ --------
Following various administrative difficulties in transferring
ownership of Reef Miners Limited from Kibo Gold Limited to Lake
Victoria Gold Limited, both parties concluded on 07 March 2022 to
cancel the previous Sale of Share Agreement by mutual consent.
As per the cancellation agreement, the Reef Transaction was
cancelled by mutual agreement between the parties, with neither
party having any claim against another party following specifically
from the cancellation agreement.
On the same day Katoro Gold plc and Lake Victoria Gold Limited
entered into a "Joint Venture Agreement". Under the terms and
conditions of the "Joint Venture Agreement", Lake Victoria Gold
Limited became the 80% shareholder of Kibo Gold Limited, Cypriot
subsidiary of Katoro Gold plc, on the date of the Agreement with
Katoro Gold plc owing the remaining 20%.
Prior to the implementation of the above "Joint Venture
Agreement", Katoro Gold plc held 200 ordinary shares in the equity
of Kibo Gold Limited, constituting 100% of the issued share capital
in the company.
On the effective date, Lake Victoria Gold Limited subscribed for
800 new shares in Kibo Gold Limited, equal to 80% of the total
issued share capital of the company on conclusion of the "Joint
Venture Agreement", for the subscription amount of EUR88,000.
Katoro Gold plc indemnifies Lake Victoria Gold Limited against
any claims resulting from the cancellation of the Sale of Share
Agreement. The position of ownership of Reef Mining Limited was
completely returned to Katoro Gold plc, and no contingent amounts
are due and payable by Lake Victoria Gold Limited in this
regard.
As per the "Joint Venture Agreement", the Conditions Precedent
for the conclusion of the Share Issue have been met on the 7th of
March 2022 and that the "effective date" of transfer of ownership
of 80% of the shareholding is on the 7th of March 2022, as the
issued shares to Lake Victoria Gold Limited rank Pari-Passu with
the issued shares.
The "Joint Venture Agreement" furthermore details the following
requirements:
- Lake Victoria Gold Limited will contribute capital to Kibo
Gold plc in the form of a shareholder's loan amounting to
EUR792,000;
- Lake Victoria Gold Limited will be obliged to declare a
preference dividend to Katoro Gold Plc in the amount of EUR792,000
which is payable in any number of instalments by the earlier of 31
December 2023 and the date is ceases to be a shareholder in the
company; and
- In the event that the preference dividend has not been
declared and paid by Kibo Gold Limited to Katoro Gold plc by 31
December 2023, the outstanding balance owing will be paid by Lake
Victoria Gold Limited to Katoro Gold plc directly.
The investment in Kibo Gold plc was as of 7 March 2022
recognised as an associate to reflect the terms of the "Joint
Venture Agreement".
The receivable in Lake Victoria Gold has been fully impaired at
30 June 2022 due to the credit risk of LVG, which is as a result of
previous payments not being received as they become due and is
still outstanding at the date of this interim report.
The resulting profit on disposal was recognised during the
period ended 30 June 2022:
Group (GBP)
Assets disposed (2,296)
Liabilities disposed 8,698
---------------
Net liability disposed 6,402
Foreign currency translation reserve reclassified
through profit or loss (46,658)
Retained investment in equity - associate (20%)
(refer note 16) 182,301
---------------
Net liabilities after disposal 142,045
Proceeds from disposal of Kibo Gold Group 729,203
---------------
Profit on disposal of Kibo Gold Group 871,248
Impairment of Receivable from LVG (656,283)
Amounts received previously offset against
proceeds (72,920)
---------------
Net profit on disposal for group at 30 June
2022 142,045
---------------
Blyvoor Joint Venture
On 30 January 2020, the Group entered into a Joint Venture
Agreement with Blyvoor Gold Mines (Pty) Ltd, whereby Katoro Gold
plc and Blyvoor Gold Mines (Pty) Ltd would become 50/50
participants in an unincorporated Joint Venture.
In accordance with the requirements of the Joint Venture
Agreement, the Katoro Group was to provide a ZAR15.0 million loan
(approximately GBP790,000) to the JV ('the Katoro Loan Facility'),
which will fund ongoing development work on the Project.
As at 31 December 2020, the Group has advanced funding in the
amount of GBP1,201,767 of which 100% relate to expenditure
allocated to the Joint Venture operations, carried by the Katoro
Gold plc Group.
Furthermore, the Group has continued to advance funding in the
amount of GBP97,207 of which 100% relate to expenditure allocated
to the Joint Venture operations, carried out by the Katoro Gold plc
Group.
The Katoro Loan Facility shall form part of the development
capital project financing that Katoro shall procure in accordance
with its obligations contained in the Agreement, as detailed below,
provided that:
-- the balance of the Katoro Loan Facility then outstanding
shall be subordinated to third party creditors participating in the
development capital project financing;
-- the Katoro Loan Facility will bear interest at the 12-month
London Inter Bank Offered Rate, or its successor; and
-- the Katoro Loan Facility will be repayable within 12 months
after:
- the last third-party creditor participating in the project
financing shall have been paid; or
- any earlier date on which the Parties may agree.
Note 14 Related parties
Relationships
Name Relationship
Kibo Energy plc Significant shareholder and controlling
parent
Related party balances trade 30 June 31 December 30 June
receivables/(trade payables) 2022 2021 2021
GBP GBP GBP
---------- ------------ --------
Kibo Energy plc (20,247) - -
---------- ------------ --------
(20,247) - -
---------- ------------ --------
Related parties of the Group comprise subsidiaries, significant
shareholders, and the Directors.
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation.
Transactions with related parties are effected on a commercial
basis and related party debts are repayable on a commercial
basis.
The transactions during the period between the Company and its
subsidiaries included the settlement of expenditure to/from
subsidiaries, working capital funding, and settlement of the
Company's liabilities through the issue of equity in subsidiaries.
The loans to/from Group companies do not have fixed repayment terms
and are unsecured.
Note 15 Principal risks
The principal risks and uncertainties identified in the last
Annual Report of Katoro Gold plc, issued in May 2021, have not
materially changed/altered in the interim period.
Note 16 Use of Estimates and Judgements
The investment in equity instruments - associates have been
valued on the fair value of the disposal price of the Kibo Gold
Subgroup to LVG:
(GBP)
Proceeds for the disposal of 80% of Kibo Gold
Subgroup to LVG 729,203
Fair value of the 100% shareholding of Kibo
Gold Subgroup 911,504
-----------
Fair value of the 20% interest in Kibo Gold
Subgroup retained 182,301
-----------
Note 17 Financial instruments - Fair value and Risk Management
The carrying amount of all financial assets and liabilities
approximates the fair value. Directors consider the carrying value
of financial instruments of a short-term nature, that mature in 12
months or less, to approximate the fair value of such assets or
liability classes.
The carrying values of longer-term assets are considered to
approximate their fair value as these instruments bear interest at
interest rates appropriate to the risk profile of the asset or
liability class.
The Group does carry any unlisted financial instruments measured
in the statement of financial position at fair value at 30 June
2022 nor in any of the comparative periods.
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END
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