TIDMKEFI
RNS Number : 0670O
Kefi Gold and Copper PLC
29 September 2023
29 September 2023
KEFI Gold and Copper plc
("KEFI", or the "Company", or the "Group")
INTERIM RESULTS FOR THE SIX MONTHSED 30 JUNE 2023
KEFI Gold and Copper plc (AIM: KEFI), the gold exploration and
development company with projects in the Democratic Republic of
Ethiopia and the Kingdom of Saudi Arabia, is pleased to announce
its unaudited interim results for the six months ended 30 June
2023.
The interim results for the Group encompass the activities of
KEFI Minerals (Ethiopia) Ltd ("KME"), Tulu Kapi Gold Mines Share
Company ("TKGM") in Ethiopia, and Gold & Minerals Ltd ("GMCO")
in Saudi Arabia.
The Tulu Kapi Gold Project ("Tulu Kapi") is currently 95%
beneficially owned by KEFI through KEFI's wholly owned subsidiary
KME. The Hawiah Copper-Gold Project ("Hawiah"), the Jibal Qutman
Gold Project ("Jibal Qutman") and other Saudi projects are held by
GMCO in which KEFI currently has a 26.8% interest.
Both TKGM and GMCO are being developed by KEFI and its partners
as separate operating companies so that each can build a local
organisation capable of developing and managing long-term
production and exploration activities, as well as fully exploit
future development opportunities.
Highlights
* In Ethiopia, the Company plans to launch Tulu Kapi in
Q4 2023. KEFI has now assembled, together with
regional financiers, both the debt and equity
development capital of US$320 million, in addition to
which the mining contractor is supplying the required
US$70 million mining fleet. TKGM is now essentially
fully permitted, with funding assembled and ready for
the final credit committee and board approvals of our
banks and project investors.
* Final credit approval awaits from the Ethiopian
central bank a formal confirmation of details of
operation of offshore banking as has been agreed
informally with TKGM and its project finance banks.
This clarification complements and clarifies the
policies and principles set out in recent published
National Bank of Ethiopia Directives waiving
strategic mining projects from foreign exchange
control and capital controls.
* KME has lodged a formal protest with the Ethiopian
Minister of Mines as a precursor to commencing
administrative proceedings in respect of its
long-standing proximal Exploration Licenses ("ELs")
surrounding the Tulu Kapi Mining Licence area, in
order to continue exploration programmes and
community development which have always complemented
Tulu Kapi. During an overhaul of the title-regulatory
system in 2022, these ELs were over-pegged by a Hong
Kong shell company owned by a British Virgin Islands
shell company. We are confident that this situation
can be resolved satisfactorily. KME has also lodged
applications for additional exploration licences
elsewhere in Ethiopia.
* In Saudia Arabia, GMCO discoveries, Jibal Qutman and
Hawiah, are in advanced stages, and are enjoying
positive regulatory support as preferred development
plans are determined.
* In early 2023, KEFI announced an updated Hawiah
Mineral Resource Estimate ("MRE") of 29.0 million
tonnes at 0.89% copper, 0.94% zinc, 0.67g/t gold and
10.1g/t silver and a maiden MRE for the nearby Al
Godeyer Project.
* GMCO has one of the largest exploration teams in
Saudi Arabia and holds 15 ELs, providing extensive
potential for further discoveries near Jibal Qutman
and Hawiah, as well as two other targeted project
areas. GMCO has six drill rigs active, mainly
conducting in-fill drilling, but also doing some
extensional drilling on current resources and
exploration drilling.
* Kefi's management considers the Company to have
reached a key turning point with the imminent planned
start of construction at Tulu Kapi. This is the
beginning of a series of major steps the Company is
planning with the key project development sequencing
as follows:
* 2023 launch Tulu Kapi open-pit in Ethiopia for first
production end-2025;
* 2024 launch Jibal Qutman Gold open-pit in Saudi
Arabia for first production end-2025;
* 2025 launch of the Hawiah Copper-Gold open-pit in
Saudi Arabia for first production 2027; and
* 2026 and thereafter launch of underground mine
development at Tulu Kapi and at Hawiah for first
production two years later.
Working Capital
KEFI has working capital in place to underpin its planned runway
to the intended closing of the Tulu Kapi project finance and launch
in the coming months. This follows the Company's repayment of all
debts in June 2023 upon completing an equity placing that raised
gross proceeds of GBP7.2 million via a GBP5.50 million Firm
Placing, GBP0.70 million Conditional Subscription, GBP0.24 million
Retail Offer and GBP0.75 million issue of Remuneration Shares in
lieu of cash to senior executives. The issue of the Conditional
Subscription, Retail Offer and Remuneration Shares were approved at
the Company's Annual General Meeting on 30 June 2023 and these
shares have subsequently been issued.
Board and Management Team
KEFI welcomed Non-Executive Director Dr Alistair Clark to the
Board on the 1 July 2023, who is a pre-eminent authority on
environmental, social, and corporate governance matters. From 2001
until 2021, Dr Clark was Managing Director, Environment and
Sustainability Department, at the European Bank for Reconstruction
and Development ("EBRD"). KEFI's recently appointed Chief Operating
Officer, Eddy Solbrandt, has assumed formal responsibility for all
project development activities with operational line management of
the Company's majority-owned projects and provides support and
advice for its minority-owned projects. The in-country project
teams have been expanded under Managing Directors Theron Brand in
TKGM in Ethiopia and Brian Hosking in GMCO in Saudi Arabia. General
Manager Corporate Development, Rob Williams, has switched from
part-time to full-time and the Tulu Kapi Project development
execution team is now being assembled within TKGM and Lycopodium.
Investor relations arrangements have also been enhanced to capture
the heightened interest from regional, corporate and sector
specialist international investors.
Quarterly Webinar
The Company will host its next quarterly investor webinar in
London in late October 2023, the details of which will be announced
in due course.
Market Abuse Regulation (MAR) Disclosure
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
Enquiries
KEFI Gold and Copper plc
Harry Anagnostaras-Adams (Managing Director) +357 99457843
John Leach (Finance Director) +357 99208130
SP Angel Corporate Finance LLP (Nominated
Adviser) +44 (0) 20 3470 0470
Jeff Keating, Adam Cowl
Tavira Securities Limited (Lead Broker) +44 (0) 20 7100 5100
Oliver Stansfield, Jonathan Evans
IFC Advisory Ltd (Financial PR and IR) +44 (0) 20 3934 6630
Tim Metcalfe, Florence Chandler
3PPB LLC International (Non-UK IR)
Patrick Chidley +1 (917) 991 7701
Paul Durham +1 (203) 940 2538
Condensed interim consolidated statements of comprehensive
income
(unaudited) (All amounts in GBP thousands unless otherwise
stated)
Six months Six months
ended ended
30 June 30 June
2023 2022
Notes Unaudited Unaudited
----------- -----------
Revenue - -
Exploration expenses - -
----------- -----------
Gross loss - -
Administration expenses (1,512) (1,282)
Share-based payments (62) (182)
Share of loss from jointly controlled
entity 11 (2,368) (898)
Impairment in jointly controlled entity 11 (203) (332)
Gain from dilution of equity interest
in joint venture 11 1,169 286
Operating loss (2,976) (2,408)
Foreign exchange (loss)/gain 12 (16)
Finance expense (452) (470)
----------- -----------
Loss before tax (3,416) (2,894)
Tax - -
----------- -----------
Loss for the period (3,416) (2,894)
=========== ===========
Loss for the period (3,416) (2,894)
Other comprehensive loss:
Exchange differences on translating - -
foreign operations
----------- -----------
Total comprehensive loss for the period (3,416) (2,894)
=========== ===========
Basic loss per share (pence) 4 (0.08) (0.09)
The notes are an integral part of these unaudited condensed
interim consolidated financial statements.
Condensed interim consolidated statements of financial
position
(unaudited) (All amounts in GBP thousands unless otherwise
stated)
Unaudited Audited
Notes 30 June 31 Dec
2023 2022
--------- ---------
ASSETS
Non-current assets
Property, plant and equipment 115 125
Intangible assets 6 32,893 31,356
Investments in JV 11 - -
33,008 31,481
--------- ---------
Current assets
Financial assets at fair value - -
through OCI
Trade and other receivables 5 1,067 463
Cash and cash equivalents 389 220
--------- ---------
1,456 683
--------- ---------
Total assets 34,464 32,164
========= =========
EQUITY AND LIABILITIES
Issued capital and reserves attributable
to owners of the parent
Share capital 7 4,858 3,939
Deferred Shares 7 23,328 23,328
Share premium 7 48,248 43,187
Share options reserve 8 3,750 3,747
Accumulated losses (52,056) (48,781)
--------- ---------
28,128 25,420
Non-controlling interest 1,621 1,562
========= =========
Total equity 29,749 26,982
Current liabilities
Trade and other payables 9 4,715 4,002
Loans and borrowings 10 - 1,180
--------- =========
4,715 5,182
--------- =========
Total liabilities 4,715 5,182
--------- ---------
Total equity and liabilities 34,464 32,164
========= =========
The notes are an integral part of these unaudited condensed
interim consolidated financial statements.
On 29 September 2023, the Board of Directors of KEFI Gold and
Copper Plc authorised these unaudited condensed interim financial
statements for issue.
John Leach
Finance Director
Condensed interim consolidated statement of changes in
equity
(unaudited) (All amounts in GBP thousands unless otherwise
stated)
Attributable to the equity holders of parent
Share Deferred Share Share options Accumulated Total NCI Total
capital shares premium and warrants losses equity
reserve
At 1 January 2022
Audited 2,567 23,328 35,884 1,891 (42,731) 20,939 1,379 22,318
Loss for the
period - - - - (2,894) (2,894) - (2,894)
Other - - - - - - - -
comprehensive
income
============ ========== ========== ============== =============== ============ ========= ============
Total
Comprehensive
Income - - - - (2,894) (2,894) - (2,894)
Recognition of
share-based
payments - - - 184 - 184 - 184
Cancellation &
Expiry
of
options/warrants - - - (281) 281 - - -
Issue of share
capital
and warrants 1,372 - 7,747 1978 - 11,097 - 11,097
Share issue costs - - (444) - - (444) - (444)
Non-controlling
interest - - - - (71) (71) 71 -
At 30 June 2022
Unaudited 3,939 23,328 43,187 3,772 (45,415) 28,811 1,450 30,261
Loss for the year - - - - (3,461) (3,461) - (3,461)
Other - - - - - - - -
comprehensive
income
============ ========== ========== ============== =============== ============ ========= ============
Total
Comprehensive
Income - - - - (3,461) (3,461) - (3,461)
Recognition of
share-based
payments - - - 182 - 182 - 182
Cancellation &
Expiry
of
options/warrants - - - (207) 207 - - -
Non-controlling
interest - - - - (112) (112) 112 -
At 1 January 2023
Audited 3,939 23,328 43,187 3,747 (48,781) 25,420 1,562 26,982
Loss for the
period - - - - (3,416) (3,416) - (3,416)
Other - - - - - - - -
comprehensive
income
============ ========== ========== ============== =============== ============ ========= ============
Total
Comprehensive
Income - - - - (3,416) (3,416) - (3,416)
Recognition of
share
based payments - - - 62 - 62 - 62
Cancellation &
Expiry
of
options/warrants - - - (200) 200 - - -
Issue of share
capital
and warrants 919 - 5,513 - - 6,432 - 6,432
Share issue costs - - (311) - - (311) - (311)
Warrants issued
fair value (141) 141 - - -
Non-controlling
interest - - - - (59) (59) 59 -
============ ========== ========== ============== =============== ============ ========= ============
At 30 June 2023
Unaudited 4,858 23,328 48,248 3,750 (52,056) 28,128 1,621 29,749
============ ========== ========== ============== =============== ============ ========= ============
The following describes the nature and purpose of each reserve
within owner's equity:
Reserve Description and purpose
Share capital amount subscribed for share capital at nominal value.
Deferred shares under the restructuring of share capital, ordinary shares of in the capital of
the Company
were sub-divided into deferred share.
Share premium amount subscribed for share capital in excess of nominal value, net of issue
costs.
Share options and warrants reserve reserve for share options and warrants granted but not exercised or lapsed.
Foreign exchange reserve cumulative foreign exchange net gains and losses recognized on consolidation.
Accumulated losses cumulative net gains and losses recognized in the statement of comprehensive
income, excluding
foreign exchange gains within other comprehensive income.
NCI (Non-controlling interest) the portion of equity ownership in a subsidiary not attributable to the parent
company.
The notes are an integral part of these unaudited condensed
interim consolidated financial statements.
Condensed interim consolidated statements of cash flows
(unaudited) (All amounts in GBP thousands unless otherwise
stated)
Notes Six months Six months
ended ended
30 June 30 June
2023 2022
----------- -----------
Cash flows from operating activities
Loss before tax (3,416) (2,894)
Adjustments for:
Share-based benefits 62 183
Fair value loss to derivative financial - -
asset
Gain from dilution of equity interest
in joint venture 11 (1,169) 286
Share of loss in joint venture 2,368 898
Impairment loss in joint venture 203 332
Depreciation 15 9
Finance expense 417 470
Foreign exchange gains/(losses) on financing
activities - (66)
Foreign exchange (losses)/gains on operating
activities 9 (16)
----------- -----------
Cash outflows from operating activities
before working capital changes (1,511) (798)
Interest paid - -
Changes in working capital:
Trade and other receivables 40 (70)
Trade and other payables 1,122 (1,141)
Net cash used in operating activities (349) (2,009)
----------- -----------
Cash flows from investing activities
Purchases of plant and equipment (3) (4)
Proceeds from repayment of financial - -
asset
Project evaluation costs 6 (1,567) (2,041)
Advances to joint venture (795) (1,167)
=========== ===========
Net cash used in investing activities (2,365) (3,212)
----------- -----------
Cash flows from financing activities
Proceeds from issue of share capital 7 2,228 8,000
Listing and issue costs 7 (311) (444)
Financing transaction costs paid - (193)
Repayment short-term working capital
bridging finance 10.2 (167) (1,140)
Proceeds short-term working capital
bridging finance 10.2 1,140 900
----------- -----------
Net cash from financing activities 2,890 7,123
----------- -----------
Net increase in cash and cash equivalents 176 1,902
Cash and cash equivalents:
At beginning of period 220 394
Exchange differences (7) 17
=========== ===========
At end of period 389 2,313
=========== ===========
The notes are an integral part of these unaudited condensed
interim consolidated financial statements.
Notes to the condensed interim consolidated financial
statements
For the six months to 30 June 2023 (unaudited) and 2022
(All amounts in GBP thousands unless otherwise stated)
1. Incorporation and principal activities
Country of incorporation
The Company was incorporated in United Kingdom as a public
limited company on 24 October 2006. Its registered office is at
27/28 Eastcastle Street, London W1W 8DH.
Principal activities
The principal activities of the Group for the period are:
-- To explore for mineral deposits of precious and base metals
and other minerals that appear capable of commercial exploitation,
including topographical, geological, geochemical and geophysical
studies and exploratory drilling.
-- To evaluate mineral deposits determining the technical
feasibility and commercial viability of development, including the
determination of the volume and grade of the deposit, examination
of extraction methods, infrastructure requirements and market and
finance studies.
-- To develop, operate mineral deposits and market the metals produced.
2. Summary of significant accounting policies
The principal accounting policies applied in the preparation of
these condensed interim consolidated financial statements are set
out below. These policies have been applied consistently throughout
the period presented in these condensed interim consolidated
financial statements unless otherwise stated.
Basis of preparation and consolidation
These condensed interim financial statements are unaudited.
The unaudited interim condensed consolidated financial
statements for the period ended 30 June 2023 have been prepared in
accordance with International Accounting Standard 34: Interim
Financial Reporting. IFRS comprise the standard issued by the
International Accounting Standard Board ("IASB"), and IFRS
Interpretations Committee ("IFRICs") as issued by the IASB as
adopted for use in the UK.
These unaudited interim condensed consolidated financial
statements include the financial statements of the Company and its
subsidiary undertakings. They have been prepared using accounting
bases and policies consistent with those used in the preparation of
the consolidated financial statements of the Company and the Group
for the year ended 31 December 2022. These unaudited interim
condensed consolidated financial statements do not include all the
disclosures required for annual financial statements, and
accordingly, should be read in conjunction with the consolidated
financial statements and other information set out in the Group's
annual report for the year ended 31 December 2022.
Going concern
The financial report has been prepared on the going concern
basis which contemplates the continuity of normal business
activities and the realisation of assets and the settlement of
liabilities in the ordinary course of business.
The annual financial statements of Kefi Gold and Copper Plc for
the year ended 31 December 2022 were prepared in accordance with UK
adopted international accounting standards in conformity with the
requirements of the Companies Act 2006. The Independent Auditors'
Report on the Group's 2022 Annual Report was an unqualified audit
opinion with a material uncertainty relating to going concern
noted.
We draw attention to the financial statements, which indicate
that the Group incurred a net loss of GBP3,416,000 (2022: loss of
GBP2,894,000) during the period ended 30 June 2023 and, as of that
date, the Group's current liabilities exceeded its current assets.
As stated in this note events or conditions, along with other
matters as set forth in this note, indicate that a material
uncertainty exists that may cast significant doubt on the Group's
ability to continue as a going concern.
The assessment of the Group's ability to continue as a going
concern involves judgment regarding future funding available for
the development of the Tulu Kapi Gold project, exploration of the
Saudi Arabia exploration properties and for working capital
requirements. In considering the Group's ability to continue as a
Going Concern, management have considered funds on hand at the date
of approval of the financial statements, planned expenditures
covering a period of at least 12 months from the date of approving
these financial statements and the Group's strategic objectives as
part of this assessment.
As at the date of approval of the financial statements, the
Group expects to be able to obtain bridging short-term financing to
fund activities until financial close of the Tulu Kapi project. The
Group has previously been successful in arranging such funding when
required and expects to be able to continue to do so. Financing
will also be required to continue the development of the Tulu Kapi
Gold Project through to production as set out in a company
announcements 'Ethiopia Operational Update' dated 5 September 2023
and 'Tulu Kapi Project Update' dated 12 September 2023.
The Group's ability to continue as a going concern is contingent
on raising additional capital and/or the successful exploration and
subsequent exploitation of its areas of interest through sale or
development. If sufficient additional capital is not raised, the
going concern basis of accounting may not be appropriate, and the
Group may have to realise its assets and extinguish its liabilities
other than in the ordinary course of business and at amounts
different from those stated in the financial report. No allowance
for such circumstances has been made in the financial report.
Notwithstanding the existence of material uncertainty that may
cast significant doubt over the Group and Company's ability to
continue as a going concern based on historical experience and
ongoing proactive discussions with stakeholders, the Board has a
reasonable expectation that the Group will be able to raise further
funds to meet its obligations. Subject to the above, the Directors
have concluded that it is appropriate to prepare the financial
statements on a going concern basis.
3. Operating segments
The Group has two distinct operating segments, being that of
mineral exploration and development and corporate activities. The
Group's exploration and development activities are in Ethiopia and
Saudi Arabia held through jointly controlled entities in each
jurisdiction with KEFI administration and corporate activities
based in Cyprus.
Unaudited Six months ended 30 June Corporate Ethiopia Saudi Total
2023 Arabia
GBP'000 GBP'000 GBP'000 GBP'000
========== ========= ======== ========
Operating loss (Excluding loss
from jointly controlled entity) (1,540) (46) - (1,586)
Other finance costs (453) - - (453)
Foreign exchange profit (759) 784 - 25
Gain on dilution of joint venture 1,169 1,169
Share of loss from jointly controlled
entity - - (2,368) (2,368)
Reversal of impairment loss in
joint venture - - (203) (203)
========== ========= ======== ========
Loss before tax (2,752) 738 (1,402) (3,416)
========== ========= ========
Tax -
--------
Loss for the period (3,416)
========
Total assets 974 33,490 - 34,464
========== ========= ======== ========
Total liabilities (4066) (649) - (4,715)
========== ========= ======== ========
Unaudited Six months ended 30 June Cyprus Ethiopia Saudi Total
2022 Arabia
GBP'000 GBP'000 GBP'000 GBP'000
======== ========= ======== ========
Operating loss (Excluding loss
from jointly controlled entity) (1,129) (48) - (1,177)
Other finance costs (470) - - (470)
Foreign exchange profit 365 (382) - (17)
Share of loss from jointly controlled
entity - - (898) (898)
Reversal of impairment loss in
joint venture - - (332) (332)
======== ========= ======== ========
Loss before tax (1,234) (430) (1,230) (2,894)
======== ========= ========
Tax -
--------
Loss for the period (2,894)
========
Total assets 1,949 30,462 - 32,411
======== ========= ======== ========
Total liabilities (957) (1,193) - (2,150)
======== ========= ======== ========
4. Loss per share
The calculation of the basic and fully diluted loss per share
attributable to the ordinary equity holders of the parent is based
on the following data:
Six months ended Six months
30 June 2023 ended 30
June 2022
Unaudited Unaudited
GBP'000 GBP'000
Net loss attributable to equity shareholders (3,416) (2,894)
Net loss for basic and diluted loss
attributable to equity shareholders (3,416) (2,894)
Weighted average number of ordinary
shares for basic loss per share (000's) 4,044,481 3,206,359
Weighted average number of ordinary
shares for diluted loss per share (000's) 5,169,887 3,851,590
Loss per share:
Basic loss per share (pence) (0.08) (0.09)
The effect of share options and warrants on the loss per share
is anti-dilutive.
5. Trade and other receivables
30 June 31 Dec
2023 2022
Unaudited Audited
GBP'000 GBP'000
Account Receivable 645 -
Other receivables 62 122
VAT 345 341
Prepayments 15 -
========== ========
1,067 463
========== ========
(1) These funds pertain to the June 2023 share placement and
amount outstanding on the 30 June 2023 will be settled subsequent
to the reporting date. This delay is attributable to the timing
variance between the issuance of shares and the receipt of cash in
the bank account.
6. Intangible assets
Total exploration
and project
evaluation
costs
GBP '000
===================
Cost
At 1 January 2022 (Audited) 31,622
Additions 1,537
-------------------
At 30 June 2023 (Unaudited) 33,159
===================
Accumulated Impairment
At 1 January 2023 (Audited) 266
At 30 June 2023 (Unaudited) 266
===================
Net Book Value at 30 June
2023 (Unaudited) 32,893
===================
Net Book Value at 31 December
2022 (Audited) 31,356
===================
7. Share capital
Number Share Deferred Share
of shares Capital shares premium Total
000's GBP'000 GBP'000 GBP'000 GBP'000
Issued and fully paid
========== ======== ========= ======== =========
At 1 January 2022 (Audited) 3,939,123 3,939 23,328 43,187 70,454
Share Equity Placement 5
June 2023 785,714 786 - 4,714 5,500
Conditional Share Equity
Placement 30 June 2023 98,325(1) 98 590 688
Retail Share Equity Placement
30 June 2023 34,820(1) 35 209 244
Share issue costs - - - (311) (311)
Warrants issue fair value
cost (141) (141)
At 30 June 2023 (Unaudited) 4,857,982 4,858 23,328 48,248 76,434
========== ======== ========= ======== =========
Issued capital
On the 5 June 2023 the Company admitted 785,714,285 new ordinary
shares of the Company at a placing price of 0.7 pence per Ordinary
Share.
At the AGM on the 30 June 2023, shareholders approved the issue
133,145,208 new ordinary shares of 0.1p each at a price of 0.7p per
share. 34,820,080 of these shares were placed with retail investors
and the balance were issued to new and/or existing investors.
(1)These shares were admitted for trading on the 3 July 2023.
Furthermore, following the AGM approval, the company also issued
107,142,857 new ordinary shares on July 3, 2023. These shares of
0.1p each, were placed at a price of 0.7p per share. See also Note
14.
8. Share Based Payments
Broker Warrants
Pursuant to shareholder approval at the AGM, certain Broker
commissions and fees were satisfied through the grant of 39,285,714
warrants granted to Tavira Securities. Each Broker Warrant entitles
the Broker to subscribe for one new Ordinary Share at a price of
0.7 pence per share, exercisable for a period of three years from 3
July 2023.
Details of warrants outstanding as at 30 June 2023:
Grant date Expiry date Exercise price Unaudited Number of warrants*
000's
19 Sep 2018 20 Sep 2023 2.5p 2,000
20 Nov 2020 20 Nov 2023 1.60p 11,175
13 Jan 2022 13 Jan 2024 1.60p 393,097
18 May 2022 17 May 2024 1.60p 500,000
18 May 2022 17 May 2025 0.80p 75,000
30 June 2023 02 July 2026 0.70p 39,286
------------------------------
1,020,558
==============================
The estimated fair values of the warrants were calculated using
the Black Scholes option pricing model. The inputs into the model
and the results are as follows:
Date Closing Exercise Expected Expected Risk Expected Discount Estimated
share price volatility life free dividend factor fair
price rate yield value
at issue
date
--------- ---------- --------- ------------ --------- ------ ---------- --------- ----------
03 July
2023 0.58p 0.70p 100% 3yrs 5.5% Nil 0% 0.36p
---------- --------- ------------ --------- ------ ---------- --------- ----------
Weighted average Unaudited
ex. price Number of
warrants*
000's
----------------- ----------
Outstanding warrants at 1 January 2023 1,54p 986,272
- granted 0.70p 39,286
- cancelled/expired/forfeited 0.65p (5,000)
- exercised
Outstanding warrants at 30 June 2023 1.51p 1,020,558
==========
These warrants were issued to advisers and shareholders of the
Group.
Share options reserve
Details of share options outstanding as at 30 June 2023:
Grant Expiry date Exercise price Unaudited
date Number of shares*
000's
----------------- -------------- -------------------------- -------------------------------
01-Feb-18 31-Jan-24 4.50p 9,600
17-Mar-21 16-Mar-25 2.55p 92,249
-------------------------------
101,849
===============================
30 June 31 Dec
2023 2022
Unaudited Audited
================ ================
Opening amount 3,747 1,891
Warrants issued costs 141 1,978
Share options charges relating to
employees 12 74
Share options issued to directors
and key management (Note 12.1) 50 292
Forfeited options (147)
Exercised warrants - -
Expired warrants (37) -
Expired options (163) (341)
---------------- ----------------
Closing Amount 3,750 3,747
================ ================
Weighted Unaudited
average ex. Number of
price shares*
000's
============= ==========
Outstanding options at 1 January 2023 3.03p 108,599
- granted - -
- forfeited - -
- cancelled/expired 7.50p (6,750)
----------
Outstanding options at 30 June 2023 2.73p 101,849
==========
The Company has not issued share options to directors, employees
and advisers to the Group during the period.
The option agreements contain provisions adjusting the exercise
price in certain circumstances including the allotment of fully
paid Ordinary shares by way of a capitalisation of the Company's
reserves, a subdivision or consolidation of the Ordinary shares, a
reduction of share capital and offers or invitations (whether by
way of rights issue or otherwise) to the holders of Ordinary
shares.
The estimated fair values of the options were calculated using
the Black Scholes option pricing model.
9. Trade and other payables
30 June 31 Dec
2023 2022
Unaudited Audited
GBP'000 GBP'000
=========== =========
Accruals and other payables 2,242 2,427
Other loans 102 109
Payable to joint venture partner (Note
11 and Note 12.3) 1,776 1,169
Payable to Key Management and Shareholder
(Note 12.3) 595 297
4,715 4,002
=========== =========
10. Loans and Borrowings
10.1. Short-Term Working Capital Bridging Finance
Currency Interest Maturity Repayment
----------- ---------------- ----------- ----------------
Unsecured working capital bridging finance GBP See Table below On Demand See Table below
The Group has the option to access working capital from certain
existing stakeholders. This unsecured working capital bridging
finance is short -- term debt which is unsecured and ranked below
other loans. Bridging Finance facilities bear a fixed interest rate
and were set off in shares by the lenders participation in the
Company placements. In the event the Group was unable to pay this
finance it would be repaid after other debt securities have been
paid, if any.
Unsecured Balance Drawdown Transaction Interest Repayment Repayment Period Ended
working 1 Jan Amount Costs Shares/Payment Cash 30 June 2023
capital 2023 Unaudited Unaudited Unaudited Netting(1) Unaudited Unaudited
bridging Audited Unaudited
finance
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Repayable
in cash in
less than
a year 1,180 1,140 - 417 (2,570) (167) -
10.2. Reconciliation of liabilities arising from financing activities
Cash Flows
Balance Inflow (Outflow) Finance Shares/Payment Balance
1 Jan Costs Netting(1) 30 June
2023 2023
Unsecured Audited Unaudited Unaudited Unaudited Unaudited Unaudited
working
capital
bridging
finance
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
============================= ========== ========== =========== ================ ============
Short term
loans 1,180 1,140 (167) 417 (2,570) -
========== ========== ------------
1,180 1,1140 (182) 417 (2,570) -
============================= ========== ========== =========== ================ ============
(1)The lenders agreed to set off their short term loans owed by
Company against amounts owed by the lenders as a result of their
participation in the Company share placements during the year. The
payment netting procedure was utilized to streamline the cash
settlement process for participating in share placement and
repaying bridging finance.
11. Joint venture agreements
KEFI is the operating partner with a 26.8% shareholding in GMCO
with ARTAR holding the other 73.2%. KEFI provides GMCO with
technical advice and assistance, including personnel to manage and
supervise all exploration and technical studies. ARTAR provides
administrative advice and assistance to ensure that GMCO remains in
compliance with all governmental and other procedures. GMCO has
five Directors, of whom two are nominated by KEFI However,
decisions about the relevant activities of GMCO require the
unanimous consent of the five directors. GMCO is treated as a
jointly controlled entity and has been equity accounted and has
reconciled its share in GMCO's losses .
During 2023, the Company has diluted its interest in the Saudi
joint-venture company Gold and Minerals from 30% to 26.80% by not
contributing its full pro rata share of expenses to GMCO. Given
that the carrying value of the GMCO assets in the Company accounts
at the date of dilution was nil because the Company's has a policy
of expensing all the costs related to GMCO to date. By diluting its
interest to GMCO to 26.8% the Company was released from this
liability. This resulted in a gain of GBP1,169,181. In accordance
with the group's accounting policy gain of GBP1,169,181 was
reported in the profit or loss during the six-month period ended 30
June 2023.
A loss of GBP2,571,000 was recognized by the Group for the
period ended 30 June 2023 (2022: GBP1,230,000) representing the
Group's share of losses for the period. As at 30 June 2023, KEFI
owed ARTAR an amount of GBP 1,776,000(2022: GBPnil).
Period
Ended
30 June
2023
Unaudited
==========
Opening Balance -
Additional Investment during the period 2,571
FX Gain on advances made to GMCO -
Share of loss in joint venture (2,368)
Additional impairment loss (203)
==========
Closing Balance -
==========
12. Related party transactions
The following transactions were carried out with related
parties:
12.1. Compensation of key management personnel
The total remuneration of the Directors and other key management
personnel was as follows:
Six months Six months
ended ended 30
30 June June 2022
2023
Unaudited Unaudited
GBP'000 GBP'000
========== ==========
Directors' fees 258 265
Directors' other benefits 18 20
Share-based benefits to directors 34 96
Director's bonus - -
Key management fees 163 84
Key management other benefits - -
Share-based benefits to key management 6 33
Key management bonus paid in shares - -
========== ==========
479 498
========== ==========
Share-based benefits
The Company has issued share options to directors and key
management. On 27 March 2014 , the Board approved a new share
option scheme ("the Scheme") for directors, senior managers and
employees. The Scheme formalised the existing policy that options
may be granted over ordinary shares representing up to a maximum of
10 per cent of the Group's issued share capital.
12.2. Transactions with shareholders and related parties
Transaction Transaction
to period to period
end end
30 June 30 June
2023 2022
Unaudited Unaudited
Name Nature of transactions Relationship GBP'000 GBP'000
=========== ===========
Receiving of management
and other professional Key Management
GPR Dehler services and Shareholder 163 84
Receiving of management
Nanancito Limited/Mr. and other professional
Nicoletto services Shareholder 141 97
=========== ===========
304 181
=========== ===========
12.3. Payable to related parties
The Group 30 June 31 Dec
203 2022
Unaudited Audited
Name Nature of transactions Relationship GBP'000 GBP'000
========= =======
Abdul Rahman Saad Al-Rashid
& Sons Company Limited Jointly controlled
("ARTAR") Finance entity partner 1,776 -
Key Management
GPR Dehler Fees for services and Shareholder 219 85
Key Management
Directors Fees for services and Shareholder 376 212
2,371 297
========= =======
13. Capital commitments
30-Jun-23 31-Dec-22
Unaudited Audited
(1)GBP'000 GBP'000
Tulu Kapi Project costs(1) 167 461
Saudi Arabia Exploration costs committed
to field work that has been recommenced 2,805 3,777
=========== ==========
(1)Once the Company and its partners in Tulu Kapi Gold Mine Share Company Limited start development
at the Tulu Kapi Gold Project (the "Project") the Company will have project capital commitments.
14. Events after the reporting date
On July 3, 2023, the Company issued 107,142,857 new ordinary
shares at a placing price of 0.7 pence per Ordinary Share,
following the Annual General Meeting held on June 30, 2023. The
total number of shares issued on July 3, 2023, for services and
obligations is outlined below:
2023
============================================
Number of Remuneration Amount
and Settlement
Name Shares
000 GBP'
000
For services rendered and obligations
settled
H Anagnostaras-Adams 26,429 185
J Leach 14,286 100
Other employees and PDMRs and
Consultants to the Company 66,428 465
Total share-based payments 107,143 750
======================= =======
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END
IR BLGDCBXDDGXI
(END) Dow Jones Newswires
September 29, 2023 02:00 ET (06:00 GMT)
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