TIDMKOD
RNS Number : 8145J
Kodal Minerals PLC
26 August 2021
Kodal Minerals Plc / Index: AIM / Epic: KOD / Sector: Mining
26 August 2021
Kodal Minerals plc ('Kodal Minerals' or the 'Company')
Final Results
Kodal Minerals, the mineral exploration and development company
focused on the Bougouni Lithium Project in Mali ("Bougouni") and
its gold assets in West Africa, pleased to announce the Annual
Report of Kodal Minerals plc ("Kodal" or the "Company" and together
with its subsidiaries, the "Group") for the year ended 31 March
2021.
The Company's Annual Report and Accounts will be made available
on the Company's website www.kodalminerals.com by 3 September
2021.
Chairman's Statement
I am pleased to present the Annual Report of Kodal Minerals plc
("Kodal" or the "Company" and together with its subsidiaries the
"Group") for the year ended 31 March 2021.
This has been an extraordinary and, at times, difficult year
with the worldwide impact of the Covid-19 pandemic as well as
turbulence in financial markets and other operational pressures.
Our Company was not immune from such challenges, however I am
pleased to report that all Kodal staff, consultants and employees
remain safe and healthy and the Company continues to prioritise the
welfare and security of its personnel. We have also closely
monitored the political situation in Mali and, following a period
of political upheaval, we are pleased to note the commitment of the
transitional government to undertaking new elections in February
2022.
Our focus for this coming year will be on the development of our
Bougouni Lithium project in Mali. Our mining licence application is
passing through its final approvals and we expect to receive our
mining licence in the near future, which is the final approval
needed for the project to be fully permitted for development. The
Company will continue its development plans including the further
optimisation and design of the proposed open pit mines, the
refinement of the processing flowsheet to include updated
metallurgical testwork and the potential scheduling of
development.
In 2021 we have seen a resurgence of interest in the lithium
sector driven by the focus of governments, industry and consumers
on the future of energy usage and storage and on the implementation
of infrastructure projects. The demand for lithium continues to
exceed previous forecasts as the utilisation of lithium-ion
batteries increases in the green energy solutions both on a large
infrastructure scale as well as on the personal level through
vehicles and personal devices. Kodal's advanced project is well
positioned to take advantage of this supply shortfall and the
strongly rising prices for the lithium spodumene concentrate will
underpin our efforts to secure financing for the Bougouni project
development.
Kodal has also expanded its portfolio of gold exploration
projects during the year with the acquisition of the Fatou gold
project located in southern Mali. This is an advanced exploration
project where previous work has outlined the potential for the
Company to delineate a mineral resource with targeted drilling
which is scheduled to take place later this year. Kodal also
regained management of and retained a 100% interest in the Nielle
gold concession in northern Cote d'Ivoire following the termination
of the joint venture with Resolute Mining Limited ("Resolute").
Previous exploration work had identified a new zone of gold
mineralisation and our recently completed drilling campaign has
returned very encouraging high-grade gold mineralisation that
requires further follow-up. Kodal has developed and is implementing
an exploration programme across its gold projects in Mali and Cote
d'Ivoire with the aim of rapidly defining new mineral resources
that will underpin the value of these highly prospective
assets.
During the year, Kodal has successfully completed a number of
fundraisings. These included a GBP0.5 million equity financing
facility and a $1.5 million convertible loan note, both of which
have been fully converted, with no further amounts outstanding to
the Investors. In March 2021, we successfully completed an equity
fundraising of GBP3.5 million (before expenses) that has resulted
in Kodal moving into the new year in a strong financial
position.
This coming year offers great opportunity for Kodal with the
focus on our Bougouni lithium project in a very positive market as
well as our exciting gold exploration and development projects. I
look forward to reporting to you on our progress during this
year.
Robert Wooldridge
Non-executive Chairman
25 August 2021
OPERATIONAL REVIEW
Kodal's operational focus during this year has been on
progressing the mining licence application for the key Bougouni
Lithium project that was initially lodged in January 2020. The
approval of this application has been delayed due to the impact of
the Covid-19 pandemic, however we have been very pleased with the
progress of the application in the first half of 2021 with the
final approval meetings being held in May 2021. We are confident
that the process of obtaining the final permit is on-track and no
further information or payment is required from the Company.
In addition to advancing the mining licence application, we have
continued to review our proposed mining and processing operation
for the Bougouni Lithium project. The focus of this work has been
on defining improvements in the processing flow sheet to lead to an
expected increase in the metallurgical recovery of the lithium
bearing spodumene minerals. This has a significant impact on the
profitability of the proposed operation and this review work
continues to indicate a very robust project.
Kodal has also taken the opportunity to expand its gold
portfolio through the acquisition of the Fatou project in southern
Mali and we have taken back management of the Nielle and Tiebiessou
concessions in Cote d'Ivoire following the termination of the Joint
Venture with Resolute. Details of the gold projects and proposed
exploration are summarised in the sections below.
Concession and Exploration Licence Review
Kodal maintains extensive tenure in Mali and Cote d'Ivoire.
Kodal's management ensures that all government compliance,
reporting and fees are kept up to date and all concessions are
retained in good standing.
Kodal's Bougouni and Bougouni West lithium exploration projects
are located in southern Mali, with the rights and concessions held
by subsidiary company Future Minerals SARL ("Future Minerals"), a
Malian registered company owned 100% by the Group. During the year,
the Company agreed modifications to the Foulaboula, Sogola Nord and
Fariedele concessions with the Direction Nationale de la Geologie
et des Mines ("DNGM") of Mali in preparation for the granting of
the mining licence. The new mining licence will be issued to
replace the Foulaboula concession and the changes were agreed to
ensure all areas of mineralisation and the proposed mining
infrastructure and processing plant for Bougouni are included
within the one licence area.
Kodal acquired the Fatou project in December 2020 consisting of
the Fininko and Foutiere concessions located in southern Mali.
These concessions are prospective for gold mineralisation, and
details of the concessions are included in the table below.
Table of Concessions - All Kodal concessions in West Africa
Tenements Country Kodal Economic Project Validity
Ownership
Dogobala Mali 90% economic Bougouni Lithium Licence valid and in
interest Project good standing. Arrêté
via direct No. 2018-1115 granted
ownership on13 April 2018 for
following initial 3 year period,
completion with option for 2 extensions
of option of 2 years validity
payments each.
Application for first
renewal has been lodged
and all fees paid.
---------- ---------------------- ------------------ ----------------------------------
Foulaboula Mali 90% economic Bougouni Lithium Licence valid and in
interest Project good standing. Arrêté
via direct No. 2018-1116 granted
ownership on 13 April 2018 for
following initial 3 year period,
completion with option for 2 extensions
of option of 2 years validity
payments each.
Licence subject to modification
during 2020 to prepare
for Mining Licence application.
Granting of Mining Exploitation
permit in progress.
---------- ---------------------- ------------------ ----------------------------------
Sogola Nord Mali 90% economic Bougouni Lithium Licence valid and in
interest. Project good standing. Arrete
Concession number 2020-0072 granted
replaces 22 January 2020 for
part Madina an initial 3 year period,
concession, with option for 2 extensions
which had of 2 years validity
reached time each.
limit Licence area modified
during 2020 to account
for the future Foulaboula
Exploitation permit.
---------- ---------------------- ------------------ ----------------------------------
Fariedele Mali 90% economic Bougouni Lithium Licence valid and in
interest. Project good standing. Arrete
Concession number 2020-0073 granted
replaces 22 January 2020 for
part Madina an initial 3 year period,
concession, with option for 2 extensions
which had of 2 years validity
reached time each.
limit Licence area modified
during 2020 to account
for the future Foulaboula
Exploitation permit.
---------- ---------------------- ------------------ ----------------------------------
Mafele Ouest Mali Held through Bougouni West Licence valid and in
Option to Lithium good standing. Arrêté
Purchase No. 2018-4537 granted
giving right on 31 December 2018
to acquire for initial 3 year period,
80% economic with option for 2 extensions
interest of 2 years validity
each.
---------- ---------------------- ------------------ ----------------------------------
NKemene Mali Held through Bougouni West Licence valid and in
Ouest Option to Lithium good standing. Arrêté
Purchase No. 2018-4486 granted
giving right on 28 December 2018
to acquire for initial 3 year period,
80% economic with option for 2 extensions
interest of 2 years validity
each.
---------- ---------------------- ------------------ ----------------------------------
Boundiali Côte 100% direct Gold Exploration Licence application
d'Ivoire ownership submitted and in process.
(under application). Application updated
during 2020 and application
remains in good standing.
---------- ---------------------- ------------------ ----------------------------------
Korhogo Côte 100% direct Gold Exploration Licence valid and in
d'Ivoire ownership good standing. Renewal
granted on 31 March
2020 for a 3 year term.
---------- ---------------------- ------------------ ----------------------------------
Dabakala Côte 100% direct Gold Exploration Licence valid and in
d'Ivoire ownership good standing. Renewal
granted on 31 March
2020 for a 3 year term.
---------- ---------------------- ------------------ ----------------------------------
Niéllé Côte 100% direct Gold Exploration Licence valid and in
d'Ivoire ownership good standing. Initial
licence expired on 7
January 2017, and Renewal
decree received on the
28 February 2018 for
a 3 year period. Second
Renewal decree received
18 December 2020 for
a 3 year period.
---------- ---------------------- ------------------ ----------------------------------
Tiebissou Côte 100% direct Gold Exploration Licence valid and in
d'Ivoire ownership good standing. Initial
term expired 30 September
2018. An application
for renewal has been
lodged, fees paid and
approved. Renewal decree
is pending signature.
---------- ---------------------- ------------------ ----------------------------------
M'Bahiakro Côte 100% direct Gold Exploration Licence application
d'Ivoire ownership submitted and in process.
Application updated
during 2020 and application
remains in good standing.
---------- ---------------------- ------------------ ----------------------------------
Djelibani Mali 100% direct Gold Exploration Convention d'Etablissement
Sud ownership granted on 21 December
2018. The Conventions
allows for non-ground
disturbing work and
application has been
made for the granting
of an Arrete to allow
more detailed exploration.
Application for Arrêté
made and all fees paid.
---------- ---------------------- ------------------ ----------------------------------
Nangalasso Mali 100% direct Nangalasso Nangalasso Arrêté
ownership Project completed second renewal
following Gold Exploration on 4 February 2021.
completion A new convention application
of option covering the same permit
payments has been lodged with
the DNGM and is awaiting
approval.
---------- ---------------------- ------------------ ----------------------------------
Sotian Mali Kodal completed Nangalasso Arrêté No.
Option agreement Project 2018-1925 granted on
and is beneficial Gold Exploration 12 June 2018 for initial
owner of 3 year period, with
concession. option for 2 extensions
of 2 years validity
each.
Application for first
renewal has been lodged
and all fees paid.
---------- ---------------------- ------------------ ----------------------------------
Tiedougoubougou Mali Kodal completed Nangalasso Arrêté No.
Option agreement Project 2018-3319 granted on
and is beneficial Gold Exploration 4 September 2018 for
owner of initial 3 year period,
concession with option for 2 extensions
of 2 years validity
each.
Application for the
first renewal will be
lodged imminently.
---------- ---------------------- ------------------ ----------------------------------
Fininko Mali Held through Fatou Project Arrêté No.
Option Agreement Gold Exploration 2018-0369 granted on
giving right 21 February 2018 for
to acquire initial 3 year period,
100% ownership with option for 2 extensions
of 2 years validity
each.
Application for first
renewal has been lodged
and all fees paid.
---------- ---------------------- ------------------ ----------------------------------
Foutiere Mali Held through Fatou Project Convention d'Etablissement
Option Agreement Gold Exploration granted on 18 December
giving right 2012.
to acquire Application for Arrêté
100% ownership made and all fees paid.
---------- ---------------------- ------------------ ----------------------------------
Bougouni Lithium Project - Mining Licence Update and Feasibility
Study Summary
Kodal's application for a mining licence for the Bougouni
lithium project has made significant progress during 2021.
In May 2021, Kodal representatives attended a committee at the
DNGM in Bamako to formally review the feasibility study and
proposed mining development for Bougouni. At the meeting, the
feasibility study and mining development plan were ratified and
approved by the DNGM committee, subject to the Company making some
minor corrections to bring the mining licence application in line
with the new Mali Mining Code of 2019. These corrections have been
completed and lodged with the DNGM. Following this lodgement, Kodal
received formal notification of the acceptance of the application
and a request to pay the Mining licence application fee, which the
Company immediately paid.
The new Exploitation Decree (mining licence) has been drafted
and verified by the Ministry of Mines, Energy and Water and
forwarded to the Secretary General's office. From this point the
licence application is prepared for presentation at the Conseil des
Ministres of Mali and following agreement will be formally
approved.
Summary of the Bougouni Project Feasibility Study
The Bougouni Lithium project feasibility study has demonstrated
the potential for a robust mining operation with attractive
economic fundamentals. Further studies continue with a particular
focus on optimising the processing plant flow sheet to further
improve lithium recovery and lower capital and operating costs.
The key highlights of the Bougouni Project Feasibility Study
are:
-- Robust project with pre-tax NPV7% of USD$300m
-- Total life of mine production of 1.94Mt of concentrate and
revenue exceeding US$1.4bn, with an initial assumed concentrate
sale price of $680/t increasing 2% year-on-year;
-- Minimum 8.5-year mine life, producing on average
approximately 220,000 tonnes of 6% spodumene concentrate per annum,
at life of mine lithium average metallurgical recovery of 71%,
based on laboratory metallurgical recoveries of 75%;
-- Proposed 2Mtpa processing plant utilising a conventional
flotation circuit to maximise spodumene recovery;
-- Estimated C1* cash costs of US$431 per tonne of concentrate
(US$466 including royalties and sustaining capital);
-- Capital requirement for development estimated to be US$117M plus contingency; and
-- Forecast payback period of 1.7 years and IRR of 58% (51% post tax).
*C1 is the net direct cash cost that represents the cash cost at
each processing stage from mining through to recoverable metal as
indicated in the Company's announcement on 27 January 2020.
Gold Exploration Projects and Exploration Programme
Kodal has expanded its gold exploration portfolio through the
acquisition of the Fatou project as announced on 17 December
2020.
The Fatou project consists of two concessions, the Fininko (also
known as Fatou) and Foutière concessions, located 280km south of
Bamako, the capital city of Mali. The project forms a contiguous
landholding exceeding 300km2 and has been acquired through
agreements with local vendors.
The Fatou project is complementary to Kodal's existing
activities in southern Mali being 100km to the south of the town of
Bougouni and only 30km to the west of the Nangalasso gold project.
The Fatou project is an advanced project with previous exploration
defining preliminary mineral resource estimates and Kodal considers
the project to have excellent exploration prospects that are drill
ready and have potential to expand the defined zones of gold
mineralisation. Historical exploration has been completed by
AngloGold Ashanti and Rockridge Capital Corp, a Canadian listed
company, which explored the project from 2010 to 2014 resulting in
a preliminary mineral resource estimate exceeding 350,000 ounces of
gold for the Fatou Main prospect.
Kodal has developed an exploration programme to test the defined
geological structures and extensions. The geological field team has
made reconnaissance visits to the project area to confirm areas of
historical exploration, the location of artisanal mining and host
rock of mineralisation, and to determine suitable access for
exploration drilling.
Details of the acquisition terms and geological summary have
been provided in the Company's announcement of 17 December
2020.
During the reporting year, Kodal regained management of, and
retained a 100% interest in, the Nielle, Tiebissou and M'Bahiakro
(application) gold concessions after termination of the joint
venture with Resolute following the decision by Kodal to refuse an
extension request.
The Company has reviewed its gold portfolio and defined priority
targets based on the potential to define JORC compliant mineral
resources quickly, as well as projects that have potential to host
large scale gold mineralisation. The priority exploration targets
for this exploration campaign are:
-- Fatou project in Mali, with drilling commencing at Fatou Main
prospect where historical exploration defined a NI43-101 Mineral
Resource estimate exceeding 350,000oz gold. The drilling will aim
to confirm and expand the known gold mineralisation and provide
data to support data for a JORC compliant Mineral Resource estimate
to be completed.
-- Nielle project in Cote d'Ivoire, where exploration completed
by Resolute has defined an extensive zone of gold mineralisation
with positive initial drilling results. The mineralised zone
remains open along strike and at depth and Kodal's initial
programme is designed to confirm and extend the mineralised zone
and provide confidence in the geological interpretation prior to
undertaking a maiden mineral resource assessment.
-- Dabakala project in Cote d'Ivoire, where exploration activity
completed by Kodal continues to confirm a major surface geochemical
anomaly with assay results up to 6.14g/t gold returned. This new
anomaly has never been previously drill tested and Kodal will focus
on infill geochemical sampling to define the key targets for
reconnaissance drill testing.
Kodal has commenced this exploration campaign with exploration
drilling completed at the Nielle concession in northern Cote
d'Ivoire and additional surface geochemistry completed at Dabakala
in central Cote d'Ivoire. The initial results from this exploration
are very encouraging with high-grade gold mineralisation
intersected in the new gold mineralised zone at Nielle, and the
continued definition of the extensive surface geochemical anomaly
at Dabakala has developed a new high priority exploration
target.
I look forward to being able to report back on these exciting
opportunities for the advancement of the Bougouni lithium project
towards mine development and the results of our gold exploration
campaign during the coming year.
Bernard Aylward
Chief Executive Officer
25 August 2021
Finance review
Results of operations
For the year ended 31 March 2021, the Group reported a loss
before other comprehensive income for the year of GBP623,000
compared to a loss of GBP630,000 in the previous year. Operational
activity has remained broadly in line with last year as the Group
has completed the Feasibility Study work at Bougouni and has
continued the running of offices in Mali and Côte d'Ivoire. Further
information is provided in the Operational Review above.
During the year, the Group invested GBP542,000 (2020:
GBP1,602,000) in exploration and evaluation expenditure on its
various projects. As a result, the carrying value of the Group's
capitalised exploration and evaluation expenditure increased from
GBP8,643,000 to GBP8,964,000 after taking account of the effects of
foreign exchange. At 31 March 2021, after taking account of the
effects of foreign exchange, the carrying value of the gold
projects in Mali and Cote d'Ivoire was GBP1,476,000 (2020:
GBP1,179,000) and of the lithium projects in Mali was GBP7,488,000
(2020: GBP7,464,000).
Cash balances as at 31 March 2021 were GBP2,433,000, an increase
of GBP2,400,000 on the previous year's level of GBP33,000, due to
the receipt of GBP1.7 million from the successful GBP3.5m equity
fundraising completed in March 2021, the final GBP1.8 million of
which was received by the Company after the year end in April 2021.
Net assets of the Group at the year-end were GBP12,636,000 (2020:
GBP8,052,000).
Financing
During the year, the Group has successfully completed a number
of fundraisings.
In April 2020 the Company entered into an equity financing
facility with Riverfort Global Opportunities PCC and YA II PN Ltd
(the 'Investors'), who subscribed for 1,428,571,429 ordinary shares
at an average price of 0.04686 pence per share, raising GBP670,000
before expenses. These subscription proceeds were used immediately
to satisfy the Company's obligation to pay GBP0.5 million to the
Investors to enter into an Equity Sharing Agreement, under which
the Investors undertook to make cash payments to the Company for a
period of up to 12 months based on the performance of Kodal's share
price. All obligations under the Equity Sharing Agreement were
satisfied prior to the year end with the Company receiving over
GBP650,000.
In July 2020, the Company entered into a Convertible Loan Note
Agreement with the Investors for a total commitment of $1.5 million
before expenses with the first tranche of $750,000 advanced at
closing, and the second tranche drawn down in October 2020.
Investors had fully exercised the option to convert outstanding
principal and interest into new ordinary shares in the Company
prior to the year end.
In December 2020, at the time of securing the acquisition of the
Fatou project, the Company entered into a conditional term sheet
with Riverfort Global Capital Limited ("Riverfort") in connection
with a proposed $2.5 million funding facility. To secure
exclusivity, Riverfort advanced an initial amount of $300,000 to
the Company whichis to be repaid by the Company in October 2021 as
the Company and Riverfort agreed not to go ahead with the funding
facility.
In March 2021, Kodal announced that it had completed an equity
fundraising of GBP3.5 million before expenses, for the purpose of
supporting Kodal in undertaking exploration, drilling and
development activities at its priority gold assets in Mali and Cote
d'Ivoire, as well as advancing its flagship Bougouni Lithium
Project.
Impact of the Covid-19 pandemic
During the year to 31 March 2021, the pandemic resulted in
lockdowns and the imposition of travel bans in many countries,
including in West Africa. As a result, field exploration operations
ceased for most of 2020, but limited activities recommenced in
early 2021 with sampling work in Dabakala, and other site visits to
the Fatou and Nielle projects undertaken. Further drilling work has
been taking place on the gold assets with further drilling work
planned later in the year as operations increasingly return to
normal.
After the substantial disruption to global equity markets in
early 2020, markets rebounded strongly during the year. This
specifically included the mining sector, and particularly for gold,
which has always been regarded as a safe haven in times of economic
turbulence. The market for lithium also improved with the
increasing focus on the need to reduce carbon emissions and the
anticipated demand for batteries in electric vehicles.
The Company was able to take advantage of this improving
environment for financing and entered into a convertible loan note
agreement for $1.5 million in July 2020, which provided important
funds to sustain the Group's continued development. With the loan
note fully converted in March 2021 the Company completed an
over-subscribed placing of ordinary shares to raise GBP3.5 million
(before expenses) for further exploration and development
activities.
Although vaccine roll outs still have some way to go,
particularly in West Africa, we anticipate that, with the
appropriate health precautions, field activities and the ability to
travel will increasingly return to normal during the rest of the
year.
Going concern and funding
The Group has not earned revenue during the year to 31 March
2021 as it is still in the exploration and development phases of
its business. The operations of the Group are currently being
financed from funds which the Company has raised from the issue of
new ordinary shares and other equity linked instruments.
At 31 March 2021, the Group held cash balances of GBP2,433,000
(2020: GBP33,000). As noted above an equity placement for GBP3.5
million took place in late March 2021, with GBP1.8 million of the
proceeds only being received after the year-end in April 2021. The
Group's cash balances at 20 August 2021 were GBP3,248,876.
The Directors have prepared cash flow forecasts for the period
ending 30 September 2022. The forecasts include payments for the
Bougouni mining licence and second stage concession payments for
the Fatou project, repayment of the $300,000 advance from
Riverfort, further development of the Bougouni Feasibility Study,
additional exploration activity for both gold and lithium, as well
as covering ongoing overheads.
Further funding will be required in due course, but the
forecasts show that the Group has sufficient cash resources
available to allow it to continue as a going concern and meet its
liabilities as they fall due for a period of at least twelve months
from the date of approval of these financial statements without the
need to raise further financing. Accordingly, the financial
statements have been prepared on a going concern basis.
Utilising key performance indicators ("KPIs")
The following KPIs are used by the Group to assist it in
monitoring its cash position and assessing costs and exploration
and development activities:
KPI 31 March 2021 31 March 2020
Cash and cash equivalents (a) GBP2,433,000 GBP33,000
Administrative expense (b) GBP513,000 GBP590,000
Exploration and evaluation expenditure GBP542,000 GBP1,602,000
(c)
The directors have provided more information on the state of the
Group's financing and operational activity above.
'Cash and cash equivalents' is used to measure the Group's
financial liquidity. Cash and cash equivalents have increased by
GBP2.4 million in the year.
'Administrative expenses' is used to measure the Group's
administrative costs and operating results. Administrative expenses
for the year were GBP513,000 compared to GBP590,000 in the previous
year.
'Exploration and evaluation expenditure' is used to measure
expenditure on the Group's gold and lithium projects. Exploration
and evaluation expenditure in the year was GBP1.1 million lower
than prior year as Kodal's operational focus has been on
progressing our application for the mining licence for its key
Bougouni Lithium project.
Financial risk management objectives and policies
The Group's principal financial instruments comprise cash and
trade and other payables. It is, and has been throughout the year
under review, the Group's policy that no trading in financial
instruments shall be undertaken. The main risks arising from the
Group's financial instruments are liquidity risk, price risk and
foreign exchange risk. The Board reviews and agrees policies for
managing each of these risks and they are summarised below.
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient
cash reserves to fund the Group's exploration and operating
activities. Management prepares and monitors forecasts of the
Group's cash flows and cash balances monthly and ensures that the
Group maintains sufficient liquid funds to meet its expected future
liabilities. The Group intends to raise funds in discrete tranches
to provide sufficient cash resources to manage the activities
through to revenue generation.
Price risk
The Group is exposed to fluctuating prices of commodities,
including gold and lithium, and the existence and quality of these
commodities within the licence and project areas. The Directors
will continue to review the prices of relevant commodities as
development of the projects continues and will consider how this
risk can be mitigated closer to the commencement of mining.
Foreign exchange risk
The Group operates in a number of overseas jurisdictions and
carries out transactions in a number of currencies including
Sterling, CFA Franc, US dollars and Australian dollars. The Group
does not have a policy of using hedging instruments but will
continue to keep this under review. The Group operates foreign
currency bank accounts to help mitigate the foreign currency
risk.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31
MARCH 2021
Note Year ended 31 March Year ended 31 March
2021 2020
GBP GBP
Continuing operations
Revenue - -
Administrative expenses (512,885) (590,389)
Share based payments 5 (77,979) (39,226)
-------------------- --------------------
OPERATING LOSS (590,864) (629,615)
Finance charge (32,506) -
Finance income - 111
-------------------- --------------------
LOSS BEFORE TAX 2 (623,370) (629,504)
Taxation 6 - -
LOSS FOR THE YEAR FROM CONTINUING OPERATIONS (623,370) (629,504)
OTHER COMPREHENSIVE INCOME
Items that may be subsequently reclassified to profit or loss
Currency translation (loss) / gain (223,635) 148,618
TOTAL COMPREHENSIVE INCOME FOR THE YEAR (847,005) (480,886)
==================== ====================
Loss per share
Basic and diluted (pence) 4 (0.0054) (0.0072)
CONSOLIDATED AND PARENT COMPANY STATEMENTS OF FINANCIAL POSITION
AS AT 31 MARCH 2021
Group Group Company Company
31 March 2021 31 March 2020 31 March 2021 31 March 2020
Note GBP GBP GBP GBP
NON-CURRENT ASSETS
Intangible assets 7 8,964,089 8,642,568 - -
Property, plant and equipment 8 8,677 14,549 - -
Amounts due from
subsidiary undertakings 9 - - 7,916,150 7,104,085
Investments in subsidiary
undertakings 9 - - 512,373 512,373
--------------- ---------------
8,972,766 8,657,117 8,428,523 7,616,458
--------------- --------------- --------------- ---------------
CURRENT ASSETS
Other receivables 10 1,854,908 19,978 1,854,908 19,978
Cash and cash equivalents 2,432,807 33,221 2,376,329 28,147
--------------- --------------- --------------- ---------------
4,287,715 53,199 4,231,237 48,125
--------------- --------------- --------------- ---------------
TOTAL ASSETS 13,260,481 8,710,316 12,659,760 7,664,583
--------------- --------------- --------------- ---------------
CURRENT LIABILITIES
Trade and other payables 11 (624,616) (658,713) (321,851) (239,230)
--------------- ---------------
TOTAL LIABILITIES (624,616) (658,713) (321,851) (239,230)
--------------- --------------- --------------- ---------------
NET ASSETS 12,635,865 8,051,603 12,337,909 7,425,353
=============== ===============
EQUITY
Attributable to owners of the
parent:
Share capital 12 4,916,364 2,889,606 4,916,364 2,889,606
Share premium account 12 15,841,134 12,514,604 15,841,134 12,514,604
Share based payment reserve 807,802 729,823 807,802 729,823
Translation reserve (210,460) 13,175 - -
Retained deficit (8,718,975) (8,095,605) (9,227,391) (8,708,680)
--------------- --------------- --------------- ---------------
TOTAL EQUITY 12,635,865 8,051,603 12,337,909 7,425,353
=============== =============== =============== ===============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
MARCH 2021
Share
Share based
Share premium payment Translation Retained Total
capital account reserve reserve deficit equity
Group GBP GBP GBP GBP GBP GBP
At 31 March 2019 2,566,418 12,147,792 690,597 (135,443) (7,466,101) 7,803,263
Comprehensive
income
Loss for the
year - - - - (629,504) (629,504)
Other comprehensive
income
Currency translation
gain - - - 148,618 - 148,618
------------
Total comprehensive
income for the
year - - - 148,618 (629,504) (480,886)
Transactions
with owners
Share based payment - - 39,226 - - 39,226
Proceeds from
shares issued 323,188 366,812 - - - 690,000
At 31 March 2020 2,889,606 12,514,604 729,823 13,175 (8,095,605) 8,051,603
Comprehensive
income
Loss for the
year - - - - (623,370) (623,370)
Other comprehensive
income
Currency translation
(loss) - - - (223,635) - (223,635)
---------- ----------- --------- -------------- ------------ -----------
Total comprehensive
income for the
year - - - (223,635) (623,370) (847,005)
Transactions
with owners
Share based payment - - 77,979 - - 77,979
Proceeds from
shares issued 2,026,758 3,548,315 - - - 5,575,073
Share issue expenses - (221,785) - - - (221,785)
---------- ----------- --------- -------------- ------------ -----------
At 31 March 2021 4,916,364 15,841,134 807,802 (210,460) (8,718,975) 12,635,865
---------- ----------- --------- -------------- ------------ -----------
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
MARCH 2021
Share
Share based
premium payment Retained Total
Share capital account reserve deficit equity
Company GBP GBP GBP GBP GBP
At 31 March 2019 2,566,418 12,147,792 690,597 (7,254,514) 8,150,293
Comprehensive income
Loss for the year - - - (1,454,166) (1,454,166)
Total comprehensive
income for the year - - - (1,454,166) (1,454,166)
Transactions with
owners
Share based payment - - 39,226 - 39,226
Proceeds from shares
issued 323,188 366,812 - - 690,000
-------------- ------------- ---------- -------------- ------------
At 31 March 2020 2,889,606 12,514,604 729,823 (8,708,680) 7,425,353
Comprehensive income
Loss for the year - - - (518,711) (518,711)
Total comprehensive
income for the year - - - (518,711) (518,711)
Transactions with
owners
Share based payment - - 77,979 - 77,979
Proceeds from shares
issued 2,026,758 3,548,315 - - 5,575,073
Share issue expenses - (221,785) - - (221,785)
-------------- ------------- ---------- -------------- --------------
At 31 March 2021 4,916,364 15,841,134 807,802 (9,227,391) 12,337,909
-------------- ------------- ---------- -------------- --------------
CONSOLIDATED AND PARENT COMPANY STATEMENTS OF CASH FLOWS FOR THE YEARED 31 MARCH 2021
Group Group Company Company
Year ended Year ended Year ended Year ended
31 March 2021 31 March 2020 31 March 2021 31 March 2020
Note GBP GBP GBP GBP
Cash flows from operating activities
Loss before tax (623,370) (629,504) (518,711) (1,454,166)
Adjustments for non-cash items:
Share based payments 77,979 39,226 77,979 39,226
Operating cash flow before movements
in working capital (545,391) (590,278) (440,732) (1,414,940)
Movement in working capital
Decrease in receivables 3,965 1,033 3,965 1,033
(Decrease) / increase in payables (34,097) 61,463 82,621 44,828
-------------- -------------- -------------- --------------
Net movements in working capital (30,132) 62,496 86,586 45,861
Net cash outflow from operating
activities (575,523) (527,782) (354,146) (1,369,079)
Cash flows from investing activities
Purchase of intangible assets 7 (535,947) (1,554,353) - -
Loans to subsidiary undertakings - - (812,065) (592,171)
-------------- -------------- -------------- --------------
Net cash outflow from investing
activities (535,947) (1,554,353) (812,065) (592,171)
Cash flow from financing activities
Net proceeds from share issues 12 2,419,241 690,000 2,419,241 690,000
Net proceeds from convertible loan
notes 1,095,152 - 1,095,152 -
Net cash inflow from financing
activities 3,514,393 690,000 3,514,393 690,000
-------------- -------------- -------------- --------------
Increase / (decrease) in cash and cash
equivalents 2,402,923 (1,392,135) 2,348,182 (1,271,250)
Cash and cash equivalents at beginning
of the year 33,221 1,408,393 28,147 1,299,397
Exchange (loss) / gain on cash (3,337) 16,963 - -
Cash and cash equivalents at end of
the year 2,432,807 33,221 2,376,329 28,147
============== ============== ============== ==============
THE PRINCIPAL ACCOUNTING POLICIES FOR THE YEARED 31 MARCH
2021
The Group has adopted the accounting policies set out below in
the preparation of the financial statements. All of these policies
have been applied consistently throughout the period unless
otherwise stated.
Financial Information
The financial information set out above does not constitute the
Company's statutory accounts for the years ended 31 March 2021 or
2020 but is derived from those accounts. Statutory accounts for
2020 have been delivered to the registrar of companies, and those
for 2021 will be delivered in due course. The auditor has reported
on those accounts; their reports were (i) unqualified, (ii) did not
include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report and
(iii) did not contain a statement under section 498 (2) or (3) of
the Companies Act 2006.
Annual Report and Accounts and Annual General Meeting
The 2021 Annual Report and Accounts and Notice of the Annual
General Meeting will be posted to shareholders and published on the
Group's website at www.kodalminerals.com shortly. The Annual
General Meeting is to be held on 28 September 2021.
Basis of preparation
The consolidated financial statements of Kodal Minerals Plc are
prepared in accordance with the historical cost convention and in
accordance with International Accounting Standards in conformity
with the requirements of the Companies Act 2006. The Company's
ordinary shares are quoted on AIM, a market operated by the London
Stock Exchange.
Going concern
The Group has not earned revenue during the year to 31 March
2021 as it is still in the exploration and development phases of
its business. The operations of the Group are currently being
financed from funds which the Company has raised from the issue of
new shares and other equity linked instruments.
At 31 March 2021, the Group held cash balances of GBP2,433,000
(2020: GBP33,000). An equity placement for GBP3.5 million took
place in late March, but GBP1.8m of the proceeds were only received
after the year-end in April. The Group's cash balances at 20 August
2021 were GBP3,248,876.
The Directors have prepared cash flow forecasts for the period
ending 30 September 2022. The forecasts include payments for the
Bougouni mining licence and second stage concession payments for
the Fatou project, repayment of the $300,000 advance from the
Riverfort Investors, further development of the Feasibility Study,
additional exploration activity for both gold and lithium, as well
as covering ongoing overheads.
Further funding will be required in due course, but the
forecasts show that the Group has sufficient cash resources
available to allow it to continue as a going concern and meet its
liabilities as they fall due for a period of at least twelve months
from the date of approval of these financial statements without the
need to raise further financing. Accordingly, the financial
statements have been prepared on a going concern basis.
Basis of consolidation
The Group financial statements consolidate those of the Company
and all of its subsidiary undertakings drawn up to the statement of
financial position date. Subsidiary undertakings are entities over
which the Group has the power to control the financial and
operating policies so as to obtain benefits from their activities.
The Group obtains and exercises control through voting rights.
Unrealised gains on transactions between the Company and its
subsidiaries are eliminated on consolidation. Unrealised losses are
also eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Amounts reported in the
financial statements of subsidiaries have been adjusted where
necessary to ensure consistency with the accounting policies
adopted by the Group.
Foreign currency translation
Items included in the Group's consolidated financial statements
are measured using the currency of the primary economic environment
in which the Group operates ("the functional currency"). The
financial statements are presented in pounds sterling ("GBP"),
which is the functional and presentational currency of the Parent
Company and the presentational currency of the Group. End of year
balances in the Group's West African subsidiary undertakings were
converted using an end of year rate of XOF 1 : GBP0.00130 (2020:
XOF 1 : GBP0.00135).
Transactions in foreign currencies are recorded using the rate
of exchange ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are translated
using the rate of exchange ruling at the reporting date and the
gains or losses on translation are included in profit and loss.
Non-monetary items that are measured in terms of historical cost in
a foreign currency are translated using the exchange rates as at
the dates of the original transactions. Non-monetary items measured
at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value was determined.
Property, plant and equipment
Property, plant and equipment are stated at cost less
accumulated depreciation and any recognised impairment loss.
Depreciation, which is included in administrative expenses, is
charged so as to write off the costs of assets down to their
residual value, over their estimated useful lives, using the
straight-line method, on the following basis:
Plant and machinery 4 years
Motor vehicles 4 years
Fixtures, fittings and equipment 4 years
Where property, plant and equipment are used in exploration and
evaluation activities, the depreciation of the assets is
capitalised as part of the cost of exploration and evaluation
assets. The assets' residual values and useful lives are reviewed,
and adjusted if appropriate, at the end of each reporting
period.
Investments in subsidiaries
Investments in subsidiaries are stated at cost less any
provision for impairment. Where the recoverable amount of the
investment is less than the carrying amount, an impairment is
recognised.
Exploration and evaluation expenditure
In accordance with IFRS 6 (Exploration for and Evaluation of
Mineral Resources), exploration and evaluation costs incurred
before the Group obtains legal rights to explore in a specific area
(a "project area") are taken to profit or loss.
Upon obtaining legal rights to explore in a project area, the
fair value of the consideration paid for acquiring those rights and
subsequent exploration and evaluation costs are capitalised as
exploration and evaluation assets. The costs of exploring for and
evaluating mineral resources are accumulated with reference to
appropriate cost centres being project areas or groups of project
areas.
Upon the technical feasibility and commercial viability of
extracting the relevant mineral resources becoming demonstrable,
the Group ceases further capitalisation of costs under IFRS 6.
Exploration and evaluation assets are not amortised prior to the
conclusion of appraisal activities, but are carried at cost less
impairment, where the impairment tests are detailed below.
Exploration and evaluation assets are carried forward until the
existence (or otherwise) of commercial reserves is determined:
where commercial reserves have been discovered, the carrying
value of the exploration and evaluation assets are reclassified as
development and production assets and amortised on an expected unit
of production basis; or
where a project area is abandoned, or a decision is made to
perform no further work, the exploration and evaluation assets are
written off in full to profit or loss.
Exploration and evaluation assets - impairment
Project areas, or groups of project areas, are determined to be
cash generating units for the purposes of assessment of
impairment.
With reference to a project area or group of project areas, the
exploration and evaluation assets (along with associated production
and development assets) are assessed for impairment when such facts
and circumstances suggest that the carrying amount of the assets
may exceed the recoverable amount.
Such indicators include, but are not limited to, those
situations outlined in paragraph 20 of IFRS 6 and include the point
at which a determination is made as to whether or not commercial
reserves exist.
The aggregate carrying value is compared against the expected
recoverable amount, generally by reference to the present value of
the future net cash flows expected to be derived from production of
the commercial reserves. Where the carrying amount exceeds the
recoverable amount, an impairment is recognised in profit or
loss.
Intangible assets and impairment
Externally acquired intangible assets are initially recognised
at cost and subsequently amortised over their useful economic
lives. Amortisation, which is included in administrative expenses,
is charged so as to write off the costs of intangible assets, over
their estimated useful lives, using the straight-line method, on
the following basis:
Software 3 years
Deferred taxation
Deferred tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated
financial statements. Deferred tax is determined using tax rates
(and laws) that have been enacted or substantively enacted by the
reporting date and are expected to apply when the related deferred
tax is realised, or the deferred liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that the future taxable profit will be available against
which the temporary differences can be utilised.
Financial instruments
Financial assets and financial liabilities are recognised on the
Statement of Financial Position when the Group becomes a party to
the contractual provisions of the instrument.
IFRS 7 (Financial Instruments: Disclosures) requires information
to be disclosed about the impact of financial instruments on the
Group's risk profile, how the risks arising from financial
instruments might affect the entity's performance, and how these
risks are being managed. The required disclosures have been made in
Note 14 to the financial statements.
The Group's policies include that no trading in derivative
financial instruments shall be undertaken.
Cash and cash equivalents
Cash and cash equivalents in the Statement of Financial Position
comprise cash at bank and in hand.
Other receivables
Other receivables are carried at amortised cost less provision
made for impairment of these receivables. A provision for
impairment of receivables is established when there is an expected
credit loss on amounts due according to the original terms of the
receivables. The amount of the provision is the difference between
the assets' carrying amount and the recoverable amount. Provisions
for impairment of receivables are included in profit or loss.
Trade and other payables
Trade payables and other payables represent liabilities for
goods and services provided to the Group prior to the end of the
financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these
goods and services. These amounts are carried at amortised cost.
The amounts are unsecured and are usually paid within 30 days of
recognition.
Provisions
A provision is recognised when a present obligation (legal or
constructive) has arisen as a result of a past event and it is
probable that a future outflow of resources will be required to
settle the obligation, provided that a reliable estimate can be
made of the amount of the obligation.
When the effect of discounting is material, the amount
recognised for a provision is the present value at the end of the
reporting period of the future expenditures expected to be required
to settle the obligation. The increase in the discounted present
value amount arising from the passage of time is included in profit
or loss.
Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares are shown in
equity as a deduction from the proceeds.
Equity settled transactions (Share based payments)
The Group has issued shares as consideration for services
received. Equity settled share-based payments are measured at fair
value at the date of issue.
The Group has also granted equity settled options and warrants.
The cost of equity settled transactions is measured by reference to
the fair value at the date on which they were granted and is
recognised as an expense over the vesting period, which ends on the
date the recipient becomes fully entitled to the award. Fair value
is determined by using the Black-Scholes option pricing model.
In valuing equity settled transactions, no account is taken of
any service and performance conditions (vesting conditions), other
than performance conditions linked to the price of the shares of
the Company (market conditions). Any other conditions which are
required to be met in order for the recipients to become fully
entitled to an award are considered to be non-vesting conditions.
Market performance conditions and non-vesting conditions are taken
into account in determining the grant value.
No expense is recognised for awards that do not ultimately vest,
except for awards where vesting is conditional upon a market or
non-vesting condition, which are vesting irrespective of whether or
not the market or non-vesting condition is satisfied, provided that
all other performance or service conditions are satisfied.
At each reporting date before vesting, the cumulative expense is
calculated; representing the extent to which the vesting period has
expired and management's best estimate of the number of equity
instruments that will ultimately vest. The movement in the
cumulative expense since the previous reporting date is recognised
in profit and loss, with a corresponding entry in equity.
Where the terms of the equity-settled award are modified, or a
new award is designated as replacing a cancelled or settled award,
the cost based on the original award terms continues to be
recognised over the original vesting period. In addition, an
expense is recognised over the remainder of the new vesting period
for the incremental fair value of any modification, based on the
difference between the fair value of the original award and the
fair value of the modified award, both as measured on the date of
the modification. No reduction is recognised if the difference is
negative.
Where an equity-based award is cancelled (including when a
non-vesting condition within the control of the entity or employee
is not met), it is treated as if it had vested on the date of the
cancellation, and the cost not yet recognised in profit and loss
for the award is expensed immediately. Any compensation paid up to
the fair value of the award at the cancellation or settlement date
is deducted from equity, with any excess over fair value being
treated as an expense.
Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the Board of Directors, which has
been identified as the Chief Operating Decision Maker. The Board of
Directors is responsible for allocating resources and assessing
performance of the operating segments in line with the strategic
direction of the Company.
Critical accounting judgements and estimates
The preparation of these consolidated financial statements in
accordance with International Financial Reporting Standards
requires the use of accounting estimates and assumptions that
affect the reported amounts of assets and liabilities at the date
of the consolidated financial statements and the reported amounts
of income and expenses during the reporting period. Although these
estimates are based on management's best knowledge of current
events and actions, actual results ultimately may differ from those
estimates. IFRS also require management to exercise its judgement
in the process of applying the Group's accounting policies.
The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of the assets
and liabilities within the next financial year are addressed
below.
Exploration and evaluation expenditure
In accordance with the Group's accounting policy for exploration
and evaluation expenditure, after obtaining licences giving legal
rights to explore in the project area, all exploration and
evaluation costs for each project are capitalised as exploration
and evaluation assets.
The exploration and evaluation assets for each project are
assessed for impairment when such facts and circumstances suggest
that the carrying value of the assets may exceed the recoverable
amount.
The directors have assessed the Group's gold Projects in Mali
and Côte d'Ivoire that are not part of the joint venture agreements
and determined that they remain prospective. Accordingly, the
directors have determined to continue to maintain these licences
and explore ways for the Group to advance these prospective areas
most effectively. Accordingly, no impairment review has been
conducted on these assets.
The directors have assessed the Group's Bougouni Lithium project
in Mali, taking into account the Preliminary Feasibility Study
published during the year. This project continues to be evaluated
and has not yet entered into development; there is no indication of
impairment. Accordingly, no impairment review has been conducted on
these assets.
The Group's exploration activities and future development
opportunities are dependent upon maintaining the necessary licences
and permits to operate, which typically require periodic renewal or
extension. In Mali and Côte d'Ivoire, the process of renewal or
extension of a licence can only be initiated on expiry of the
previous term and takes time to be processed by the relevant
government authority. Until formal notification is received there
is a risk that renewal or extension will not be granted.
As detailed in the Operational Review, at the date of these
financial statements, the Group's key exploration licences are
current. As detailed in note 7, the total carrying value of the
exploration and evaluation assets at 31 March 2021 was GBP9.0
million (2020: GBP8.6 million). The Group complies with the
prevailing laws and regulations relating to these licences and
ensures that the regulatory reporting and government compliance
requirements for each licence are met.
Valuation of warrants and share options
In accordance with the Group's accounting policy for equity
settled transactions, all equity settled share-based payments are
measured at fair value at the date of issue. Fair value is
determined by using the Black-Scholes option pricing model based on
the terms of the options and warrants, the Company's share price at
the time and assumptions for volatility and exercise date. The
assumptions used to value the options and warrants are detailed in
note 5.
For options awarded to the directors, the award has been
considered to be in relation to their overall contribution to the
Group and, accordingly, the charge has been included within
operating costs in the Consolidated Statement of Comprehensive
Income rather than treated as an exploration and evaluation cost
and capitalised against specific projects. For the award of
warrants associated with the raising of funds through the issue of
new shares, the charge has been treated as a share issue expense
and offset against the share premium account.
Recoverability of Intercompany Balances to Subsidiary
Undertakings
The Company has outstanding intercompany balances from its
directly held subsidiaries resulting from the primary method of
financing the activity of those subsidiaries. The balances are
shown in the Company Statement of Financial Position. However,
there is a risk that the subsidiaries will not commence sufficient
revenue generating activities and that the carrying amount of the
intercompany balances will, therefore, exceed the recoverable
amount. Under the requirements of IFRS 9 management has run various
scenarios on the expected credit loss of the Company's intercompany
balances, including entering production, project/asset sales, and
insolvency. Management has updated its calculations reflecting
additional amounts advanced to its subsidiaries for work on its
lithium and gold projects during the year, and also slightly
reduced the risk of credit loss given improvements since last year
in the financial, lithium and gold markets. At 31 March 2021 a
credit loss provision of GBP877,000 is held against amounts due
from subsidiaries (2020: GBP877,000).
Adoption of New and Revised Standards
The Group has adopted all of the new or amended Accounting
Standards and interpretations issued by the International
Accounting Standards Board ("IASB") that are mandatory and relevant
to the Group's activities for the current reporting period.
New standards and interpretations not applied
At the date of authorisation of these consolidated financial
statements, certain new standards, amendments and interpretations
to existing standards have been published but are not yet effective
and have not been adopted early by the Group. These are listed
below. The Board anticipates that all of the pronouncements will be
adopted in the Group's accounting policies for the first period
beginning after the effective date of the pronouncement. The
amendments to the standards noted below are not expected to have a
material impact on the Group's consolidated financial
statements.
Standard Details of amendment / New Standards Annual periods beginning on or after
and Interpretations
IAS 1 Presentation of Financial Amendments to IAS 1 Presentation of 1 January 2023
Statements Financial Statements to specify the
requirements for classifying
liabilities as current or
non-current.
IAS 1 Presentation of Financial Amendments to IAS 1 Presentation of 1 January 2023
Statements Financial Statements to specify the
requirements for disclosure
of accounting policies.
There are other standards in issue but not yet effective, which
are not likely to be relevant to the Group which have therefo re
not been listed.
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARED 31 MARCH
2021
1. SEGMENTAL REPORTING
The operations and assets of the Group in the year ended 31
March 2021 are focused in the United Kingdom and West Africa and
comprise one class of business: the exploration and evaluation of
mineral resources. Management have determined that the Group had
three operating segments being the West African Gold Projects, the
West African Lithium Projects and the UK administration operations.
The Parent Company acts as a holding company. At 31 March 2021, the
Group had not commenced commercial production from its exploration
sites and therefore had no revenue for the year.
Year ended 31 March 2021 UK West Africa West Africa Total
Gold Lithium
GBP GBP GBP GBP
Administrative expenses (512,349) (409) (127) (512,885)
Share based payments (77,979) - - (77,979)
Finance charge (32,506) - - (32,506)
Loss for the year (622,834) (409) (127) (623,370)
---------- ------------ -------------- -----------
At 31 March 2021
Other receivables 1,854,908 - - 1,854,908
Cash and cash equivalents 2,377,831 30,846 24,130 2,432,807
Trade and other payables (321,851) - (302,765) (624,616)
Intangible assets - exploration and evaluation
expenditure - 1,491,269 7,472,820 8,964,089
Property, plant and equipment - - 8,677 8,677
Net assets at 31 March 2021 3,910,888 1,522,115 7,202,862 12,635,865
---------- ------------ -------------- -----------
Year ended 31 March 2020 UK West Africa West Africa Total
Gold Lithium
GBP GBP GBP GBP
Administrative expenses (589,806) (500) (83) (590,389)
Share based payments (39,226) - - (39,226)
Finance income 111 - - 111
---------- ------------ ------------ ----------
Loss for the year (628,921) (500) (83) (629,504)
---------- ------------ ------------ ----------
At 31 March 2020
Other receivables 19,978 - - 19,978
Cash and cash equivalents 29,516 3,536 169 33,221
Trade and other payables (239,230) (1,488) (417,995) (658,713)
Intangible assets - exploration and evaluation
expenditure - 1,178,567 7,464,001 8,642,568
Property, plant and equipment - - 14,549 14,549
Net (liabilities) / assets at 31 March
2020 (189,736) 1,180,615 7,060,724 8,051,603
---------- ------------ ------------ ----------
2. LOSS BEFORE TAX
Group Group
Year ended Year ended
31 March 2021 31 March 2020
GBP GBP
Fees payable to the Company's auditor 35,000 30,000
Share based payments (note 5) 77,979 39,226
Directors' salaries and fees 127,265 164,939
Employer's National Insurance 5,672 1,956
Amounts payable to RSM UK Audit LLP and its associates in
respect of both audit and non-audit services are as follows;
Group Group
Year ended Year ended
31 March 31 March
2021 2020
GBP GBP
Audit services
- statutory audit of parent and
consolidated accounts 35,000 30,000
3. EMPLOYEES' AND DIRECTORS' REMUNERATION
The average number of people employed in the Company and the
Group is as follows:
Group Group Company Company
31 March 2021 31 March 2020 31 March 2021 31 March 2020
Number Number Number Number
Average number of employees (including
directors): 9 9 4 4
--------------- --------------- --------------- ---------------
The remuneration expense for directors of the Company is as
follows:
Year ended Year ended
31 March 2021 31 March 2020
GBP GBP
Directors' remuneration 115,014 164,939
Directors' social security costs 5,673 1,956
--------------- ---------------
Total 120,687 166,895
--------------- ---------------
In addition to the amounts included above, GBP62,496 (2020:
GBP67,300) of the directors' remuneration cost has been treated as
Exploration and Evaluation expenditure.
Directors' salary and fees year ended Share based payments
31 March 2021 year ended Total
31 March year ended
2021 (see note 5) 31 March
2021
GBP GBP GBP
Bernard Aylward (a) 96,510 - 96,510
Charles Joseland (b) 35,000 - 35,000
Robert Wooldridge 27,250 - 27,250
Qingtao Zeng (c) 18,750 - 18,750
177,510 - 177,510
====================================== ===================== =============
Directors' salary and fees year ended Share based payments
31 March 2020 year ended Total
31 March year ended
2020 (see note 5) 31 March
2020
GBP GBP GBP
Bernard Aylward (a) 111,763 1,776 113,539
Luke Bryan 5,385 1,776 7,161
Charles Joseland (b) 33,430 9,564 42,994
Mark Pensabene 11,661 2,294 13,955
Robert Wooldridge 45,000 888 45,888
Qingtao Zeng (c) 25,000 1,321 26,321
232,239 17,619 249,858
====================================== ===================== =============
a Matlock Geological Services Pty Ltd ("Matlock") a company wholly owned by Bernard Aylward,
provided consultancy services to the Group during the year ended 31 March 2021 and received
fees of GBP76,094 (2020 GBP76,764). These fees are included within the remuneration figure
shown for Bernard Aylward.
b In addition to the amounts included above, Carolus Consulting Ltd, a company wholly owned
by Charles Joseland, provided consultancy services to the Group during the year and received
fees of GBPnil (2020: GBP1,500).
c In addition to the amounts included above, Geosmart Consulting Pty Ltd, a company wholly owned
by Qingtao Zeng, provided consultancy services to the Group during the year and received fees
of GBP10,595 (2020: GBP13,480).
4. LOSS PER SHARE
Basic loss per share is calculated by dividing the loss for the
year attributable to ordinary equity holders of the parent by the
weighted average number of ordinary shares outstanding during the
year.
The following reflects the result and share data used in the
computations:
Loss Weighted average number of shares Basic loss per share (pence)
GBP
Year ended 31 March 2021 (623,370) 11,529,513,459 0.0054
Year ended 31 March 2020 (629,504) 8,786,936,058 0.0072
Diluted loss per share is calculated by dividing the loss
attributable to ordinary equity holders of the parent by the
weighted average number of ordinary shares outstanding during the
year plus the weighted average number of ordinary shares that would
be issued on conversion of all the dilutive potential ordinary
shares into ordinary shares. Options in issue are not considered
diluting to the loss per share as the Group is currently
loss making. Diluted loss per share is therefore the same as the basic loss per share.
5. SHARE BASED PAYMENTS
The share-based payment reserve is used to recognise the value
of equity-settled share-based payments provided to employees,
including key management personnel, as part of their
remuneration.
Year ended Year ended
31 March 2021 31 March 2020
Share options outstanding Number Number
Opening balance 205,000,000 195,000,000
Issued in the year - 20,000,000
Lapsed in the year - (10,000,000)
Closing balance 205,000,000 205,000,000
=============== ===============
Year ended Year ended
31 March 2021 31 March 2020
Warrants outstanding Number Number
Opening balance 205,000,000 205,000,000
Issued in the year 389,282,755 -
Exercised in the year (308,927,092) -
Closing balance 285,355,663 205,000,000
=============== ===============
Options outstanding for each of the directors at the year-end
are outlined below:
Exercisable between Bernard Aylward Robert Wooldridge Qingtao Zeng Charles Joseland
8 May 2017 - 8 May 2022 25,000,000 12,500,000 - -
8 May 2018 - 8 May 2023 12,500,000 6,250,000 - -
8 May 2019 - 8 May 2024 12,500,000 6,250,000 - -
20 Nov 2017 - 20 Nov 2022 - - 5,000,000 -
20 Nov 2018 - 20 Nov 2023 - - 2,500,000 -
20 Nov 2019 - 20 Nov 2024 - - 2,500,000 -
18 April 2019 - 18 April
2024 - - - 3,333,334
18 April 2020 - 18 April
2025 - - - 3,333,333
18 April 2021 - 18 April
2026 - - - 3,333,333
Closing balance 50,000,000 25,000,000 10,000,000 10,000,000
================ ================== ============= =================
The total value of options and warrants granted in the year was
GBP29,912 (2020: GBP39,226). Included within operating losses is a
charge for issuing share options and making share-based payments of
GBP77,979 (2020: GBP39,226).
Details of share options and warrants outstanding at 31 March
2021:
Date of grant Number of options Option price Exercisable between
20 December 2013 13,333,333 0.7 pence 30 Dec 2014 - 30 Dec
2024
20 December 2013 13,333,333 0.7 pence 30 Dec 2015 - 30 Dec
2025
20 December 2013 13,333,333 0.7 pence 30 Dec 2016 - 30 Dec
2026
8 May 2017 72,500,000 0.38 pence 8 May 2017 - 8 May 2022
8 May 2017 36,250,000 0.38 pence 8 May 2018 - 8 May 2023
8 May 2017 36,250,000 0.38 pence 8 May 2019 - 8 May 2024
22 May 2017 12,500,000 0.38 pence 22 May 2017 - 22 May 2022
22 May 2017 6,250,000 0.38 pence 22 May 2018 - 22 May 2023
22 May 2017 6,250,000 0.38 pence 22 May 2019 - 22 May 2024
20 November 2017 5,000,000 0.38 pence 20 Nov 2017 - 20 Nov
2022
20 November 2017 2,500,000 0.38 pence 20 Nov 2018 - 20 Nov
2023
20 November 2017 2,500,000 0.38 pence 20 Nov 2019 - 20 Nov
2024
23 November 2018 39,999,999 0.14-0.38 pence 1 March 2019 - 1
March 2024
23 November 2018 50,000,001 0.14-0.38 pence To be determined at
a future date
23 November 2018 90,000,000 0.14-0.38 pence To be determined at
a future date
18 April 2019 3,333,334 0.14-0.25 pence 18 April 2020 - 18 April
2025
18 April 2019 3,333,333 0.14-0.25 pence 18 April 2021 - 18 April
2026
18 April 2019 3,333,333 0.14-0.25 pence 18 April 2022 - 18 April
2027
15 July 2020 48,790,008 0.061 pence 15 July 2023
27 October 2020 31,565,656 0.09 pence 27 October 2023
Additional disclosure information:
Weighted average exercise price of share options and
warrants:
outstanding at the beginning of the period 0.41 pence
granted during the period 0.06 pence
outstanding at the end of the period 0.35 pence
exercisable at the end of the period 0.33 pence
Weighted average remaining contractual life of
share options outstanding at the end of the period 3.2 years
Warrants issued in the year to 31 March 2021
The Company entered into option agreements dated 7 April 2020,
15 July 2020 and 27 October 2020 with Riverfort Global
Opportunities PCC Limited and YA II PN Ltd under which the
following warrants were issued:
Date Warrants issued Exercise price
7 April 2020 228,571,428 0.04375 pence
15 July 2020 97,580,016 0.061 pence
27 October 2020 63,131,311 0.09 pence
The warrants are all exercisable for a period of 36 months from
the date of grant. Of the total warrants issued in the year,
308,927,092 had been exercised prior to the year end.
The fair values of the options and warrants granted were
calculated using the Black-Scholes valuation model. The inputs into
the model were:
7 April 2020 15 July 2020 27 October 2020
Strike price 0.04375p 0.061p 0.09p
Share price 0.0294p 0.0294p 0.0294p
Volatility 75% 75% 75%
Expiry date 7 April 2020 15 July 2020 27 October 2020
- 7 April 2023 - 15 July 2023 - 27 October
2023
Risk free
rate 0.28% 0.28% 0.28%
Dividend
yield 0.0% 0.0% 0.0%
Share options issued in the year to 31 March 2020
The Company entered into option agreements dated 18 April 2019
with Charles Joseland and dated 8 May 2019 with Mark Pensabene
under which up to 10 million share options may be issued to each of
Mr Joseland and Mr Pensabene in three tranches as follows:
Exercise price per share Tranche 1 Tranche 2 Tranche 3 Total
0.14p 1,666,667 1,666,667 1,666,666 5,000,000
0.25p 1,666,667 1,666,666 1,666,667 5,000,000
Total 3,333,334 3,333,333 3,333,333 10,000,000
All the options have a life of 5 years from vesting. 34 per
cent. of the options vest in one year, with a further 33 per cent.
vesting in two years and the remaining 33 per cent. vesting in
three years' time. The options issued to Mr Pensabene lapsed on 31
October 2019 when Mr Pensabene resigned before the options had
vested.
The fair values of the options and warrants granted were
calculated using the Black-Scholes valuation model. The inputs into
the model were:
18 April 2019 8 May 2019
Strike price 0.14p - 0.25p 0.14p - 0.25p
Share price 0.08p - 0.11p 0.07p - 0.09p
Volatility 69% 69%
Expiry date 18 April 2020 - 8 May 2020 -
18 April 2027 8 May 2027
Risk free 0.11% - 0.19% 0.12% - 0.20%
rate
Dividend
yield 0.0% 0.0%
6. TAXATION
Group Group
Year ended Year ended
31 March 2021 31 March 2020
GBP GBP
Taxation charge for the year - -
--------------- ---------------
Factors affecting the tax charge for the year
Loss from continuing operations before income tax (623,370) (629,504)
Tax at 19% (2019: 19%) (118,440) (119,606)
Expenses not deductible - 606
Losses carried forward not deductible 103,624 111,547
Deferred tax differences 14,816 7,453
Income tax expense - -
=============== ===============
The Group has tax losses and other potential deferred tax assets
totalling GBP2,425,000 (2020: GBP2,258,000) which will be able to
be offset against future income. No deferred tax asset has been
recognised in respect of these losses as the timing of their
utilisation is uncertain at this stage.
7. INTANGIBLE ASSETS
Exploration and evaluation
GROUP GBP
COST
At 1 April 2019 6,951,209
Additions in the year 1,601,526
Effects of foreign exchange 89,833
---------------------------
At 1 April 2020 8,642,568
Additions in the year 541,772
Effects of foreign exchange (220,251)
---------------------------
At 31 March 2021 8,964,089
AMORTISATION
At 1 April 2019 and 1 April 2020 and 31 March 2021 -
---------------------------
NET BOOK VALUES
At 31 March 2021 8,964,089
===========================
At 31 March 2020 8,642,568
===========================
At 31 March 2019 6,951,209
===========================
The Company did not have any Intangible Assets as at 31 March
2019, 2020 and 2021.
8. PROPERTY, PLANT AND EQUIPMENT
Plant and machinery
GROUP GBP
COST
1 April 2019 26,447
Additions in the year -
Effects of foreign exchange 577
--------------------
At 1 April 2020 27,024
Additions in the year 526
Effects of foreign exchange (1,471)
--------------------
At 31 March 2021 26,079
DEPRECIATION
At 1 April 2019 6,546
Depreciation charge 5,929
At 1 April 2020 12,475
Depreciation charge 5,825
Effects of foreign exchange (898)
At 31 March 2021 17,402
--------------------
NET BOOK VALUES
At 31 March 2021 8,677
====================
At 31 March 2020 14,549
====================
At 31 March 2019 19,901
====================
All tangible assets are wholly associated with exploration and
development projects and therefore the amounts charged in respect
of depreciation are capitalised as evaluation and exploration
assets within intangible assets.
The Company did not have any Property, Plant and Equipment as at
31 March 2019, 2020 and 2021.
9. SUBSIDIARY UNDERTAKINGS
a. AMOUNTS DUE FROM SUBSIDIARY UNDERTAKINGS
Company Company
31 March 31 March
2021 2020
GBP GBP
Amounts due from subsidiary
undertakings 7,916,150 7,104,085
7,916,150 7,104,085
Under the requirements of IFRS 9 management has run various
scenarios on the expected credit loss of the Company's intercompany
balances, including entering production, project/asset sales, and
insolvency. Management has updated its calculations reflecting
additional amounts advanced to its subsidiaries for work on its
lithium and gold projects during the year, and also slightly
reduced the risk of credit loss given improvements since last year
in the financial, lithium and gold markets. At 31 March 2021 a
credit loss provision of GBP877,000 is held against amounts due
from subsidiaries (2020: GBP877,000).
b. INVESTMENTS IN SUBSIDIARY UNDERTAKINGS
The consolidated financial statements include the following
subsidiary companies:
Country of Registered office Equity holding Nature of
Company Subsidiary of incorporation business
Kodal Norway (UK) Kodal Minerals Plc United Kingdom Prince Frederick 100% Operating company
Ltd House,
35-39 Maddox
Street, London
W1S 2PP
International Kodal Minerals Plc Bermuda MQ Services Ltd 100% Holding company
Goldfields Victoria Place,
(Bermuda) Limited 31 Victoria
Street,
Hamilton HM 10
Bermuda
International International Côte d'Ivoire Abidjan Cocody 100% Mining exploration
Goldfields Goldfields Les Deux Plateaux
Côte (Bermuda) Limited 7eme Tranche
d'Ivoire SARL BP Abidjan
Côte
d'Ivoire
International International Mali Bamako, Faladi, 100% Mining exploration
Goldfields Mali Goldfields Mali Univers, Rue
SARL (Bermuda) Limited 886 B, Porte 487
Mali
Jigsaw Resources International Bermuda MQ Services Ltd 100% Mining exploration
CIV Ltd Goldfields Victoria Place,
(Bermuda) Limited 31 Victoria
Street,
Hamilton HM 10
Bermuda
Corvette CIV SARL Jigsaw Resources Côte d'Ivoire Abidjan Cocody 100% Mining exploration
CIV Ltd Les Deux Plateaux
7eme Tranche
BP Abidjan
Côte
d'Ivoire
Future Minerals International Mali Bamako, Faladi, 100% Mining exploration
SARL Goldfields Mali Univers, Rue
(Bermuda) Limited 886 B, Porte 487
Mali
Kodal Minerals plc has issued a guarantee under section 479C to
its subsidiary, Kodal Norway (UK) Ltd ("Kodal Norway", company
number 08491224) in respect of its activities for the year ended 31
March 2021 to allow Kodal Norway to take advantage of the exemption
under s479A of the Companies Act 2006 from the requirements of the
Act relating to audit of its individual accounts for the year ended
31 March 2021.
Year ended Year ended
Carrying value of investment in subsidiaries 31 March 2021 31 March 2020
GBP GBP
Opening balance 512,373 512,373
Impairment in the year - -
Closing balance 512,373 512,373
=============== ===============
10. OTHER RECEIVABLES
Group Group Company Company
31 March 2021 31 March 2020 31 March 2021 31 March 2020
GBP GBP GBP GBP
Share issue proceeds receivable 1,838,895 - 1,838,895 -
Other receivables 16,013 19,978 16,013 19,978
1,854,908 19,978 1,854,908 19,978
All receivables at each reporting date are current. No
receivables are past due. The Directors consider that the carrying
amount of the other receivables approximates their fair value and
there are no expected credit losses.
11. TRADE AND OTHER PAYABLES
Group Group Company Company
31 March 31 March 31 March 31 March
2021 2020 2021 2020
GBP GBP GBP GBP
Trade payables 357,514 456,847 55,401 147,438
Other payables 267,102 201,866 266,451 91,792
624,616 658,713 321,852 239,230
All trade and other payables at each reporting date are current.
The Directors consider that the carrying amount of the trade and
other payables approximates their fair value.
12. SHARE CAPITAL
GROUP AND COMPANY
Allotted, issued and fully paid:
Note Nominal Value Number of Ordinary Shares Share Capital Share Premium
GBP GBP
At 31 March 2019 8,212,539,503 2,566,418 12,147,792
July 2019 a GBP0.0003125 718,750,000 224,609 228,516
July 2019 - Treasury shares held GBP0.0003125 (250,000,000) (78,125) -
August 2019 b GBP0.0003125 65,451,616 20,454 44,546
October 2019 c GBP0.0003125 250,000,000 78,125 93,750
October 2019 - Treasury shares sold GBP0.0003125 250,000,000 78,125 -
At 31 March 2020 9,246,741,119 2,889,606 12,514,604
April 2020 d GBP0.0003125 1,428,571,429 446,429 202,102
April 2020 e GBP0.0003125 378,323,379 118,226 14,187
June 2020 f GBP0.0003125 56,987,211 17,809 2,137
September 2020 g GBP0.0003125 228,571,428 71,429 28,571
October 2020 h GBP0.0003125 125,034,486 39,073 40,199
November 2020 i GBP0.0003125 85,063,264 26,582 27,348
December 2020 j GBP0.0003125 118,600,205 37,063 38,130
January 2021 k GBP0.0003125 176,190,315 55,059 56,645
January 2021 l GBP0.0003125 347,078,879 108,462 111,586
February 2021 m GBP0.0003125 153,379,428 47,931 74,314
March 2021 n GBP0.0003125 128,080,136 40,025 68,131
March 2021 o GBP0.0003125 210,896,619 65,905 114,538
March 2021 p GBP0.0003125 168,489,949 52,653 91,507
March 2021 q GBP0.0003125 2,800,000,000 875,000 2,424,075
March 2021 r GBP0.0003125 48,790,008 15,247 14,515
March 2021 s GBP0.0003125 31,565,656 9,864 18,545
At 31 March 2021 15,732,363,511 4,916,364 15,841,134
-------------------------- -------------- --------------
a) On 29 July 2019, a total of 718,750,000 shares were issued in
a placing at an issue price of 0.08 pence per share. Of these
placing shares, 250,000,000 shares were allotted to SVS Securities
plc which entered administration on 5 August 2019 and did not
complete its placing participation. These shares were held as
treasury shares at 30 September 2019 and were then placed on 28
October 2019.
b) On 2 August 2019, a total of 65,451,616 shares were issued to
Bambara Resources SARL at an issue price of 0.099 pence per
share.
c) On 28 October 2019, a total of 250,000,000 shares were issued
in a placing and subscription at a price of 0.05 pence per share.
In addition, the Company placed the 250,000,000 shares allotted to
SVS Securities plc in July 2019 at the same price.
d) On 7 April 2020, a total of 1,428,571,429 shares were issued
to Riverfort Global Opportunities PCC Limited and YA II PN Ltd (the
"Investors") in connection with the Equity Sharing Agreement
("ESA"). The shares issued under the ESA were issued at an average
price of 0.04686 pence per share. Share issue expenses of GBP20,860
were offset against the share premium account.
e) On 7 April 2020, a total of 378,323,379 shares were issued at
an issue price of 0.035 pence per share to a number of Directors
and senior management as payment for salaries or fees owed.
f) On 29 May 2020, a total of 56,987,211 shares were issued at a
price of 0.035 pence per share to satisfy payment of certain third
party professional fees.
g) On 7 September 2020, a total of 228,571,428 shares were
issued to the Investors at a price of 0.04375 pence per share in
connection with the exercise of warrants issued in connection with
the ESA.
h) On 15 October 2020, the Investors elected to convert a total
amount of $102,352.31 (equivalent to GBP79,271.86), made up of a
principal amount of US$100,004.40 and accrued interest of
$2,347.91, into 125,034,486 ordinary shares at a price of 0.06340
pence per share.
i) On 2 November 2020, the Investors elected to convert a total
amount of $70,358.92 (equivalent to GBP53,930.11), made up of a
principal amount of $70,000.00 and accrued interest of $358.92,
into 85,063,264 ordinary shares at a price of 0.06340 pence per
share.
j) On 15 December 2020, the Investors elected to convert a total
amount of $101,160.41 (equivalent to GBP75,192.53), made up of a
principal amount of $100,000.00 and accrued interest of $1,160.41,
into 118,600,205 ordinary shares at a price of 0.06340 pence per
share.
k) On 5 January 2021, the Investors elected to convert a total
amount of $150,809.59 (equivalent to GBP111,704.66), made up of a
principal amount of $150,000.00 and accrued interest of $809.59,
into 176,190,315 ordinary shares at a price of 0.06340 pence per
share.
l) On 8 January 2021, the Investors elected to convert a total
amount of $300,242.88 (equivalent to GBP220,048.01), made up of a
principal amount of $300,000.00 and accrued interest of $242.88,
into 347,078,879 ordinary shares at a price of 0.06340 pence per
share.
m) On 19 February 2021, the Investors elected to convert a total
amount of $169,384.70 (equivalent to GBP122,244.94), made up of a
principal amount of $150,000.00 and accrued interest of $19,384.70,
into 153,379,428 ordinary shares at a price of 0.079701 pence per
share.
n) On 17 March 2021, the Investors elected to convert a total
amount of $150,971.51 (equivalent to GBP108,155.99), made up of a
principal amount of $150,000 and accrued interest of $971.51, into
128,080,136 ordinary shares at a price of 0.084444 pence per
share.
o) On 22 March 2021, the Investors elected to convert a total
amount of $250,337.33 (equivalent to GBP180,443.15), made up of a
principal amount of $250,000 and accrued interest of $337.33, into
210,896,619 ordinary shares at a price of 0.08556 pence per
share.
p) On 22 March 2021, the Investors elected to convert a total
amount of US$200,000 (equivalent to GBP144,160), made up of a
principal amount of US$200,000 and no accrued interest, into
168,489,949 ordinary shares at a price of 0.08556 pence per
share.
q) On 25 March 2021, a total of 2,800,000,000 shares were issued
in a placing at a price of 0.125 pence per share. Share issue
expenses of GBP200,925 were offset against the share premium
account.
r) On 25 March 2021, a total of 48,790,008 shares were issued to
the Investors at a price of 0.061 pence per share in connection
with the exercise of warrants.
s) On 25 March 2021, a total of 31,565,656 shares were issued to
the Investors at a price of 0.09 pence per share in connection with
the exercise of warrants.
13. RESERVES
Reserve Description and purpose
Share premium Amount subscribed for share capital in excess of nominal value.
Share based payment reserve Cumulative fair value of options and share rights recognised as an expense. Upon
exercise
of options or share rights, any proceeds received are credited to share capital. The
share-based
payment reserve remains as a separate component of equity.
Translation reserve Gains/losses arising on re-translating the net assets of overseas operations into
sterling.
Retained earnings Cumulative net gains and losses recognised in the consolidated statement of financial
position.
14. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT
The Group's principal financial instruments comprise cash and
cash equivalents, other receivables and trade and other
payables.
The main purpose of cash and cash equivalents is to finance the
Group's operations. The Group's other financial assets and
liabilities such as other receivables and trade and other payables,
arise directly from its operations.
It has been the Group's policy, throughout the periods presented
in the consolidated financial statements, that no trading in
financial instruments was to be undertaken, and no such instruments
were entered in to.
The main risk arising from the Group's financial instruments is
market risk. The Directors consider other risks to be more minor,
and these are summarised below. The Board reviews and agrees
policies for managing each of these risks.
Market risk
Market risk is the risk that changes in market prices, and
market factors such as foreign exchange rates and interest rates
will affect the Group's results or the value of its assets and
liabilities.
The objective of market risk management is to manage and control
market risk exposures within acceptable parameters while optimising
the return.
Interest rate risk
The Group does not have any borrowings and does not pay
interest.
The Group's exposure to the risks of changes in market interest
rates relates primarily to the Group's cash and cash equivalents
with a floating interest rate. These financial assets with variable
rates expose the Group to interest rate risk. All other financial
assets and liabilities in the form of receivables and payables are
non-interest bearing.
In regard to its interest rate risk, the Group periodically
analyses its exposure. Within this analysis consideration is given
to alternative investments and the mix of fixed and variable
interest rates. The Group does not engage in any hedging or
derivative transactions to manage interest rate risk.
The Group in the year to 31 March 2021 earned interest of GBPnil
(2020: GBP111). Due to the Group's relatively low level of
interest-bearing assets and the very low interest rates available
in the market the Group is not exposed to any significant interest
rate risk.
Credit risk
Credit risk refers to the risk that a counterparty could default
on its contractual obligations resulting in financial loss to the
Group. The Group's principal financial assets are cash balances and
other receivables.
The Group has adopted a policy of only dealing with what it
believes to be creditworthy counterparties and would consider
obtaining sufficient collateral where appropriate, as a means of
mitigating the risk of financial loss from defaults. The Group's
exposure to and the credit ratings of its counterparties are
continuously monitored. An allowance for impairment is made where
there is objective evidence that the Group will not be able to
collect all amounts due according to the original terms of the
receivables concerned.
Other receivables consist primarily of prepayments and other
sundry receivables and none of the amounts included therein are
past due or impaired.
Financial instruments by category - Group
Other financial liabilities at amortised
Loans and receivables cost
Total
31 March 2021
Assets
Other receivables 1,854,908 - 1,854,908
Cash and cash equivalents 2,432,807 - 2,432,807
------------------------ ------------------------------------------ ------------
Total 4,287,715 - 4,287,715
======================== ========================================== ============
Liabilities
Trade and other payables - (624,616) (624,616)
------------------------ ------------------------------------------ ------------
Total - (624,616) (624,616)
======================== ========================================== ============
31 March 2020 GBP GBP GBP
Assets
Other receivables 19,978 - 19,978
Cash and cash equivalents 33,221 - 33,221
--------- ------------ ------------
Total 53,199 - 53,199
========= ============ ============
Liabilities
Trade and other payables - (658,713) (658,713)
Total - (658,713) (658,713)
========= ============ ============
Foreign exchange risk
Throughout the periods presented in the consolidated financial
statements, the functional currency for the Group's West African
subsidiaries has been the CFA Franc.
The Group incurs certain exploration costs in the CFA Franc, US
Dollars and Australian Dollars and has exposure to foreign exchange
rates prevailing at the dates when Sterling funds are translated
into other currencies. The CFA Franc has a fixed exchange rate to
the Euro and the Group therefore has exposure to movements in the
Sterling : Euro exchange rate. The Group has not hedged against
this foreign exchange risk as the Directors do not consider that
the level of exposure poses a significant risk.
The Group continues to keep the matter under review as further
exploration and evaluation work is performed in West Africa and
other countries and will develop currency risk mitigation
procedures if the significance of this risk materially
increases.
The Group's consolidated financial statements have a low
sensitivity to changes in exchange due to the low value of assets
and liabilities (principally cash balances) maintained in foreign
currencies. Once any project moves into the development phase a
greater proportion of expenditure is expected to be denominated in
foreign currencies which may increase the foreign exchange
risk.
Financial instruments by currency - Group
GBP USD NOK AUD XOF Total
31 March 2021
Assets
Other receivables 1,854,908 - - - - 1,854,908
Cash and cash
equivalents 2,202,748 173,586 1,497 - 54,976 2,432,807
---------- ---------- ------ ------ ------- ----------
Total 4,057,656 173,586 1,497 - 54,976 4,287,715
=======
Liabilities
Trade and other
payables (83,714) (539,503) - (749) (650) (624,616)
---------- ---------- ------ ------ ======= ----------
GBP USD NOK AUD XOF Total
31 March
2020
Assets
Other receivables 19,978 - - - - 19,978
Cash and
cash equivalents 28,147 - 1,370 - 3,704 33,221
---------- ---------- ------ --------- ---------- ----------
Total 48,125 - 1,370 - 3,704 53,199
==========
Liabilities
Trade and
other payables (179,506) (314,468) - (54,665) (110,074) (658,713)
---------- ---------- ------ --------- ========== ----------
Liquidity risk
Liquidity risk is the risk that the entity will not be able to
meet its financial obligations as they fall due.
The objective of managing liquidity risk is to ensure, as far as
possible, that the Group will always have sufficient liquidity to
meet its liabilities when they fall due, under both normal and
stressed conditions.
The Group has established policies and processes to manage
liquidity risk. These include:
Monitoring the maturity profiles of financial assets and
liabilities in order to match inflows and outflows;
Monitoring liquidity ratios (working capital); and
Capital management procedures, as defined below.
Capital management
The Group's objective when managing capital is to ensure that
adequate funding and resources are obtained to enable it to develop
its projects through to profitable production, whilst in the
meantime safeguarding the Group's ability to continue as a going
concern. This is to enable the Group, once projects become
commercially and technically viable, to provide appropriate returns
for shareholders and benefits for other stakeholders.
The Group has historically relied on equity to finance its
growth and exploration activity, raised through the issue of
shares. In the future, the Board will utilise financing sources, be
that debt or equity, that best suits the Group's working capital
requirements and taking into account the prevailing market
conditions.
Fair value
The fair value of the financial assets and financial liabilities
of the Group, at each reporting date, approximates to their
carrying amount as disclosed in the Statement of Financial Position
and in the related notes.
The fair values of the financial assets and liabilities are
included at the amounts at which the instrument could be exchanged
in a current transaction between willing parties, other than in a
forced or liquidation sale.
The cash and cash equivalents, other receivables, trade payables
and other current liabilities approximate their carrying value
amounts largely due to the short-term maturities of these
instruments.
Disclosure of financial instruments and financial risk
management for the Company has not been performed as they are not
significantly different from the Group's position described
above.
15. RELATED PARTY TRANSACTIONS
The Directors represent the key management personnel of the
Group and details of their remuneration are provided in note 3.
Robert Wooldridge, a Director, is a member of SP Angel Corporate
Finance LLP ("SP Angel") which acts as financial adviser and broker
to the Company. During the year ended 31 March 2021, the Company
paid fees to SP Angel of GBP240,381 (2020: GBP58,323). The balance
due to SP Angel at 31 March 2021 was GBPnil (2020: GBP7,979).
Matlock Geological Services Pty Ltd ("Matlock") a company wholly
owned by Bernard Aylward, a Director, provided consultancy services
to the Group during the year ended 31 March 2021 and received fees
of GBP76,094 (2019 GBP76,764). These fees are included within the
remuneration figure shown for Bernard Aylward in note 3. The
balance due to Matlock at 31 March 2021 was GBPnil (2020:
GBP21,626).
Geosmart Consulting Pty Ltd ("Geosmart"), a company wholly owned
by Qingtao Zeng, a Director, provided consultancy services to the
Group during the year ended 31 March 2021 and received fees of
GBP10,595 (2020: GBP13,480). The balance due to Geosmart at 31
March 2021 was GBPnil (2020: GBP2,502).
Carolus Consulting Ltd ("Carolus"), a company wholly owned by
Charles Joseland, a Director, provided consultancy services to the
Group during the year ended 31 March 2021 and received fees of
GBPnil (2020: GBP1,500). The balance due to Carolus at 31 March
2021 was GBPnil (2020: GBPnil).
16. CONTROL
No one party is identified as controlling the Group.
17. CAPITAL COMMITMENTS
The Group had capital commitments to exploration and evaluation
expenditure of GBPnil (2020: GBP130,000).
18. EVENTS AFTER THE REPORTING PERIOD
On 21 May 2021, a total of 80,355,664 shares were issued to the
Investors in connection with the exercise of warrants. 48,790,008
warrants were issued in July 2020 with an exercise price of 0.061
pence per share and 31,565,656 warrants were issued in October 2020
with an exercise price of 0.09 pence per share.
**ENDS**
For further information, please visit www.kodalminerals.com or
contact the following:
Kodal Minerals plc
Bernard Aylward, CEO Tel: +61 418
943 345
Allenby Capital Limited, Nominated Adviser
Jeremy Porter/Nick Harriss/Liz Kirchner Tel: 020 3328
5656
SP Angel Corporate Finance LLP, Financial Adviser
& Broker Tel: 020 3470
John Mackay, Adam Cowl 0470
St Brides Partners Ltd, Financial PR
Susie Geliher/Isabelle Morris Tel: 020 7236
1177
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