TIDMKOD
RNS Number : 0259S
Kodal Minerals PLC
28 September 2017
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 ("MAR"). With the publication of this announcement,
this information is now considered to be in the public domain.
Kodal Minerals Plc / Index: AIM / Epic: KOD / Sector: Mining
28 September 2017
Kodal Minerals plc ("Kodal Minerals", the "Company" or the
"Group")
Final Results and Notice of AGM
Kodal Minerals plc, the mineral exploration and development
company focussed on West Africa, is pleased to announce its audited
final results for the year ended 31 March 2017.
The Company's Annual Report and Accounts is being posted to
shareholders later this week and will be made available on the
Company's website www.kodalminerals.com. It will contain notice of
the Annual General Meeting of the Company to be held at Fieldfisher
LLP, 9(th) Floor, Riverbank House, 2 Swan Lane, EC4R 3TT at 12.00
p.m. on Tuesday 31 October 2017.
Chairman's Statement
Kodal Minerals began a year of significant change and
development with the acquisition of a suite of ten West African
gold licences (together the "Gold Projects") which was announced in
April 2016 and completed in May 2016. This was followed by the
subsequent acquisitions of six exciting lithium exploration
licences (together the "Lithium Projects") in southern Mali by way
of three separate transactions announced in August, September and
November 2016.
The Lithium Projects are referred to as the Bougouni Project and
the Diendio Project. These acquisitions strengthened our focus in
West Africa and further expanded the range of minerals in which the
Group is interested. In particular, the Bougouni Project, acquired
in September 2016, has been particularly successful for the Company
with our exploration programme continuing to demonstrate high-grade
lithium mineralisation. We have completed two drilling programmes
at the Bougouni Project, with a total of six prospects tested.
Drilling has consisted of reverse circulation ("RC") drilling and
diamond drilling, with a total of 76 RC drill holes for 10,260
metres completed and 5 diamond drill holes for 362 metres
completed. In particular, the Ngoualana prospect within the
Bougouni Project looks extremely exciting with the strike length of
the mineralised zone currently confirmed at 650 metres. This zone
remains open along strike and has yielded multiple high-grade
intersections including 28 metres at 1.96% lithium oxide ("Li(2)
O").
The Company has been very successful in securing its financial
position through a series of equity fundraisings during the year.
In May 2016, we raised GBP0.7 million in connection with the
acquisition of the Gold Projects. Subsequently, we completed a
capital raising in October 2016 of GBP0.75 million to support the
initial acquisition of the Lithium Projects, then a further
placement of GBP1.0 million in January 2017 to expand the lithium
exploration programme and continue to delineate the high-grade
lithium mineralisation. Most significantly in March 2017, the
Company announced an initial investment of GBP0.5 million by
Singapore based investment company Suay Chin International Pte
Limited ("Suay Chin"), followed in May 2017 with the conclusion of
a formal subscription agreement with Suay Chin for a further GBP4.3
million investment in the Company together with a binding off-take
term sheet covering the Group's lithium production from the
Bougouni Project. This subscription agreement is continuing, with
Suay Chin having completed staged investments since the year end
for a total of GBP4.0 million, bringing its total investment to
GBP4.5 million out of its overall committed investment of GBP4.8
million. Suay Chin is now the largest shareholder in the Company,
with a holding of 18.92%.
While our focus is currently on the rapid definition of the
extent of lithium mineralisation at our projects in southern Mali,
the Company has maintained the suite of West African gold assets
acquired in May 2016. In Côte d'Ivoire, the joint venture projects
with Resolute Mining Limited ("Resolute") and Newcrest Mining
Limited ("Newcrest") are continuing. Resolute has been very active
in the Nielle licence, located in the north of Côte d'Ivoire, where
a new surface gold anomaly has been defined. It is anticipated that
Resolute will continue to explore this area in the coming year, and
is expected to complete first pass reconnaissance drilling.
Newcrest has continued with the auger drilling programme on the
Dabakala licence, located in central Côte d'Ivoire, and continues
to assess the area.
For those Gold Projects held outside the joint ventures, Kodal
has maintained its licences in Mali and Côte d'Ivoire, and during
the coming year will continue to review the exploration data and
explore ways for the Company to advance these prospective areas
most effectively.
Outside West Africa, the Group has maintained its Norwegian
phosphate and titano-magnetite project ("Kodal Project") during the
year and continues to evaluate opportunities for it. Following an
impairment review at the other Norwegian project, the Grimeli
copper project, the Company has fully impaired this asset and
expects to relinquish these licence areas.
During the year, the Company also completed changes to the Board
of directors, with the resignation of former Chairman David Jones
and my stepping up from non-executive director to Chairman. The
Company is looking to strengthen the Board, and when the Suay Chin
placement is completed, Suay Chin will have the right to appoint a
director who will assist the Company in its growth plans.
We are looking forward to the year ahead as we have a very busy
exploration programme planned, which is concentrated on our lithium
Bougouni and Diendio Projects. We will continue drilling at
Bougouni with the aim of targeting extensions and providing
definition to the known mineralised zones and looking to identify
new prospects. With the support of our major shareholder, we will
continue with the metallurgical testing of our lithium mineralised
zones and review the plant and processing requirements to allow the
production of a spodumene concentrate suitable for marketing to
China-based end users. This will be a very exciting year for
development at Bougouni and we anticipate being able to continue to
add significantly to the value of the Lithium Projects.
We look forward to being able to report back to you during the
year on developments.
Robert Wooldridge
Non-Executive Chairman
27 September 2017
OPERATIONAL REVIEW
I am delighted to present this operational review following a
very busy and transformational year for our Company. Following a
review of opportunities, the Board of Kodal identified lithium as a
high-value strategic mineral having recently seen strong demand for
batteries (deployed in electric cars and for static storage) and
tight supply apply upward pressure on prices. The Company was able
to leverage the strong operational history and understanding of
Mali of its senior executives to acquire two exciting lithium
exploration projects that significantly expanded our footprint in
West Africa and which complement our existing gold exploration
licences.
The two Lithium Projects are located in southern Mali - the
Bougouni Project and the Diendio Project. Our field exploration
activities for the year focused on these lithium projects, and in
particular on the rapid advancement of the Bougouni Project where
our exploration activities include geological mapping and
geochemical sampling, trenching, geophysical review and drilling.
The exploration completed to date has continued to return very
encouraging results and the Company is planning a major exploration
programme at Bougouni during the 2017/2018 financial year.
Kodal Minerals has also maintained the suite of gold exploration
licences in Côte d'Ivoire and Mali following the acquisition of
International Goldfields (Bermuda) Limited ("IG Bermuda") and its
subsidiaries in May 2016. These gold licences are all located in
highly mineralised regions of the Birimian sequence of West Africa
and early stage exploration work has returned encouraging
results.
The Group has maintained the Kodal Project in Norway during the
year and continues to evaluate opportunities for it. Following an
impairment review at the other Norwegian project, the Grimeli
copper project, the Company has fully impaired this asset and
expects to relinquish these licence areas.
Lithium Projects
The new lithium projects, located in southern Mali, are held by
subsidiary company Future Minerals SARL ("Future Minerals"), a
Malian registered company owned 100% by the Group. Future Minerals
holds the rights to the projects via three separate option to
purchase agreements that grant Kodal exclusive rights to explore
and exploit all minerals in the respective licence areas, and upon
completion of agreed staged payments allow Future Minerals to
become the registered holder and owner of a 90% economic interest
in each of the licences.
The lithium project licences are tabled below:
Table of Concessions - Mali Lithium projects
Tenements Country Kodal Ownership Project/Joint Validity
Venture
------------ -------- ---------------- -------------- ----------------------
Kolassokoro Mali Held through Bougouni Licence valid
Option to Project and in good
Purchase standing.
Agreement Renewal received
giving right dated 19 September
to acquire 2017 and valid
up to 90% for 2 years.
economic
interest
------------ -------- ---------------- -------------- ----------------------
Madina Mali Held through Bougouni Licence valid
Option to Project and in good
Purchase standing.
Agreement Renewal received
giving right dated 19 September
to acquire 2017 and valid
up to 90% for 2 years.
economic
interest
------------ -------- ---------------- -------------- ----------------------
Diendio Mali Held through Diendio Licence valid
Sud Option to Project and in good
Purchase standing. First
Agreement renewal expired
giving right on 30/4/2016.
to acquire Application
up to 90% for renewal
economic for a further
interest 2 years submitted
and awaiting
formal approval;
all fees paid.
------------ -------- ---------------- -------------- ----------------------
Diossyan Mali Held through Diendio Licence valid
Sud Option to Project and in good
Purchase standing. First
Agreement renewal expired
giving right on 2/5/2016.
to acquire Application
up to 90% for renewal
economic for a further
interest 2 years submitted
and awaiting
formal approval;
all fees paid.
------------ -------- ---------------- -------------- ----------------------
Manankoro Mali Held through Diendio Licence valid
Nord Option to Project and in good
Purchase standing.
Agreement Licence is in
giving right the form of
to acquire a signed convention
up to 90% dated 21/01/2013.
economic The convention
interest is the first
stage of being
granted a licence
and it is normal
to apply for
an arrêté
to continue
exploration
on areas of
anomalism or
geological interest.
The Group has
applied for
the arrêté
and paid all
fees. Upon grant,
the arrêté
will be valid
for 3 years,
with right for
renewals each
for 2 years.
------------ -------- ---------------- -------------- ----------------------
All licences remain valid and in good standing pending receipt
of formal documents for renewals or arrêtésin respect of which the
Company has received letters from the Directorate Nationale de la
Géologie et des Mines ("DNGM", Malian National Directorate of
Geology and Mines) confirming all such applications are complete
and in process.
Bougouni Lithium Project Exploration Highlights
Exploration Drilling and Geological Exploration
Since acquiring the Bougouni Lithium project in August and
September of 2016, Kodal has been actively exploring this highly
prospective area. The Company has completed two stages of
exploration drilling that total 76 reverse circulation drill holes
for 10,260m drilled and 5 diamond drill holes for 362m drilled. The
exploration drilling has targeted six prospects within the Bougouni
Lithium project, with approximately 60% of the drilling metres
targeting the Ngoualana prospect where high-grade lithium
mineralisation has been encountered in a spodumene rich pegmatite
vein. Exploration drilling and geological mapping has now
identified a high-grade pegmatite vein that extends for over 650m
strike length, has been drill tested to approximately 200m
vertically and remains open along strike and at depth. This is a
key target for further drilling for Kodal in the new field
season.
In addition, exploration drilling has targeted new prospect
areas where high-grade lithium mineralisation has been identified
in early stage geological mapping and rock-chip sampling and areas
where surface mineralisation has been identified that has potential
to host shallow, high-grade mineralisation.
The drilling programmes commenced with a reconnaissance Stage 1
programme completed in December 2016, and a major Stage 2 programme
running from April 2017 to June 2017. The Company has received very
encouraging results from the drilling programmes, particularly at
the Ngoualana and Sogola-Baoule prospects where highlights
include:
-- 21m at 1.70% Li(2) O from 62m in drill KLRC001, Ngoualana
-- 22m at 1.64% Li(2) O from 45m in drill KLRC004, Ngoualana
-- 21m at 1.72% Li(2) O from 11m in drill KLRC024, Ngoualana
-- 18m at 2.06% Li(2) O from 140m in drill KLRC027, Ngoualana
-- 47m at 1.51% Li(2) O from 32m in drill KLRC028, Ngoualana
-- 41.5m at 1.71% Li(2) O from 45.39m in drill KLDH001, Ngoualana
-- 27.25m at 1.61% Li(2) O from 28.65m in drill KLDH005, Ngoualana
-- 12m at 1.68% Li(2) O from 216m in drill MDRC015, Sogola-Baoule
-- 12m at 1.59% Li(2) O from 241m in drill MDRC015, Sogola-Baoule
-- 17m at 1.79% Li(2) O from 277m in drill MDRC015, Sogola-Baoule
-- 11m at 1.65% Li(2) O from 131m in drill MDRC008, Sogola-Baoule
It is noted that the drilling is still at an exploration stage
and the Company continues to review the drilling with the focus
being on extension and definition drilling of the Ngoualana
prospect, extension of the Sogola-Baoule prospect and
identification of additional exploration targets. The Company has
continued to focus on the Bougouni Project with the objective of
defining a future "mining hub" where multiple pegmatite veins
provide source for a central processing plant.
The Company is currently planning the new drilling programme to
commence following the cessation of the annual rains, and will
immediately follow-up the high-grade intersections at
Sogola-Baoule, Ngoualana and Boumou. In addition, the Company has
been undertaking preparation work at other prospects, including
ground magnetics, and this will be used to prioritise other
prospects for initial drill testing.
A summary of the completed drilling across the Stage 1 and Stage
2 programmes is provided below:
Bougouni Lithium Project - Summary of Completed Drilling
Prospect Reverse Circulation Diamond Drilling
Drilling
Holes Metres Holes Metres
Ngoualana 42 5,936 5 362
Sogola 6 415
Sogola-Baoule 14 2,327
Boumou 6 842
Orchard 4 544
Kola 4 196
TOTAL 76 10,260 5 362
In addition to the drill testing, the Company has completed
geological mapping, a total of 121 rock chip samples and a total of
14 trench excavations for 862m. This reconnaissance geological work
continues to define targets for drill testing and demonstrate the
prospectivity of the Bougouni Project.
Metallurgical Test work
In June 2017, the Company announced the results of initial
metallurgical test work on a sample of core from the RC drilling at
the Ngoualana prospect. This indicated that the ore could produce
high grade spodumene concentrate with good levels of recovery.
The metallurgical recoveries ranged from 80% to 87% using only a
flotation process and produced high grade spodumene concentrate
with grades ranging between 5.5% and 6.7% Li(2) O. The level of
mineralisation is of suitable grade and quality for the production
of lithium carbonate which is used in the manufacture of lithium
batteries and other industrial applications.
The metallurgical testing was completed at the Shandong Ruifu
Lithium Co Ltd ("Shandong Ruifu") which operates a lithium
carbonate and lithium hydroxide production plant in China. Shandong
Ruifu has a close relationship with Kodal's major shareholder Suay
Chin International Pte Ltd and is looking to secure supply of
quality lithium bearing minerals following a recently completed
upgrade to its processing plant.
This initial test work used flotation tests only, as the samples
comprised reverse circulation drill chips which contain a
significant portion of very fine material not suitable for other
techniques.
Further metallurgical test work is planned utilising diamond
drill core to seek to further enhance overall recoveries through a
comprehensive process utilising gravity separation as well as
flotation.
Gold Projects
The Group's Gold Projects are located in Côte d'Ivoire and Mali
and consist of licences either directly 100% owned by the Group, or
held via option agreements granting the Group exclusive rights to
explore and exploit minerals over the area and containing a right
to purchase the licences. In Mali, the licences are held through
subsidiary company IGS Mali SARL ("IGS Mali"), a Malian registered
company, and in Côte d'Ivoire by IGS CIV SARL ("IGS CIV") and
Corvette SARL ("Corvette"), Côte d'Ivoire registered companies.
In Mali, the Group has two projects, the Nangalasso Project
(including the Nangalasso and Sotian licence areas) and the SLAM
Project (including the Djelibani Sud and Kambali licences). The
Nangalasso Project licences are held through option to purchase
agreements that grant the Company exclusive rights to explore and
operate over the licences and allow the Company to acquire the
licence outright. For the SLAM Project, the Djelibani Sud licence
is held outright following the completion of the final option
payment during the year, while the Kambali licence is subject to
the DNGM granting an extension, and this licence remains subject to
an Option to purchase agreement.
In Côte d'Ivoire, the Group is the 100% owner of the Korhogo
licence having secured the licence via direct Government
application and is applying for the Boundiali licence. The Group is
also continuing with two active joint ventures in Côte d'Ivoire,
with joint venture partners, Resolute and Newcrest, each
responsible for the maintenance and good standing of the
licences.
The gold exploration licences are tabled below:
Table of Licences - Gold Exploration projects
Tenements Country Kodal Project Validity
Group / Joint
Ownership Venture
----------- ---------- -------------- ------------- -----------------------------
Djelibani Mali 100% SLAM Project Licence valid and
Sud direct in good standing with
ownership expiry date 29 October
2017.
Application to transfer
licence to IGS Mali
has been submitted
and is pending completion.
The Group intends
to lodge an application
for extension of prior
to the expiry in October
2017 and, in addition,
is reviewing the potential
for new licence application
----------- ---------- -------------- ------------- -----------------------------
Kambali Mali Held SLAM Project Licence expired in
through 2016. Application
Option for additional year
Agreement has been lodged; awaiting
giving formal acceptance
right letter from DNGM.
to acquire
100%
ownership
----------- ---------- -------------- ------------- -----------------------------
Nangalasso Mali Held Nangalasso Permit is valid and
through Project in good standing.
Option First renewal expired
Agreement on 4 February 2017.
giving Application for renewal
right for further 2 years
to acquire submitted and awaiting
100% formal approval; all
ownership fees paid.
----------- ---------- -------------- ------------- -----------------------------
Sotian Mali Held Nangalasso Licence expired in
through Project 2017. Application
Option for an additional
Agreement year of validity over
giving the whole licence
right has been submitted
to acquire and is under discussion
100% with DNGM.
ownership Due to change of Government
regulations on licence
size, two new applications
have also been lodged
for 100km2 each, to
cover the majority
of existing licence
area. These applications
are awaiting formal
approval by DNGM if
application for additional
year of validity for
the whole licence
is rejected.
----------- ---------- -------------- ------------- -----------------------------
Boundiali Côte 100% Licence application
d'Ivoire direct submitted and in process.
ownership
(under
application)
----------- ---------- -------------- ------------- -----------------------------
Korhogo Côte 100% Licence valid and
d'Ivoire direct in good standing
ownership Renewal granted in
September 2017 for
a further 3 year period.
----------- ---------- -------------- ------------- -----------------------------
Dabakala Côte 100% Newcrest Licence valid and
d'Ivoire direct JV in good standing.
ownership Renewal granted in
may reduce September 2017 for
to 25% a further 3 year period.
under
JV agreement
----------- ---------- -------------- ------------- -----------------------------
Nielle Côte 100% Resolute Licence valid and
d'Ivoire direct JV in good standing.
ownership Initial licence term
may reduce expired on 7 January
to 25% 2017.
under Renewal application
JV agreement lodged and all fees
paid. Government field
visit completed in
September 2017 and
now awaiting formal
notification of renewal.
----------- ---------- -------------- ------------- -----------------------------
Tiebissou Côte 100% Resolute Licence valid and
d'Ivoire direct JV in good standing.
ownership Initial term expires
may reduce 30 September 2018.
to 25%
under
JV agreement
----------- ---------- -------------- ------------- -----------------------------
M'Bahaikro Côte 100% Resolute Licence application
d'Ivoire direct JV submitted and in process.
ownership
(under
application)
may reduce
to 25%
under
JV agreement
----------- ---------- -------------- ------------- -----------------------------
All licences remain valid and in good standing pending receipt
of formal documents for renewals or arrêtés. The Company is
continuing to pursue the Boundiali and M'Bahaikro applications with
the DGMG Direction General des Mines et de la Géologie in Côte
d'Ivoire and is looking to advance the process this year.
Norway Projects
Kodal retains full rights to the two projects located in Norway,
namely the Kodal Project, a phosphate and titano-magnetite project
located in southern Norway and the Grimeli copper-zinc project
located in western Norway.
Kodal Project
The Kodal Project is a phosphate and titano-magnetite project
located in southern Norway. Previous exploration and development
activity completed by the Company has defined a JORC compliant
total Indicated Resource of 14.6 million tonnes (Mt) at 2.26% P
(5.18% P2O5) and 24.12% Fe with an Inferred Resource of 34.3
million tonnes at 2% P (4.59% P2O5) and 20.38% Fe.
The Group is maintaining the Kodal Project and has continued
discussions with local municipalities and stakeholders in the area.
The Group will continue to review options for development or other
opportunities in the region to realise value for this project.
Grimeli Project
The Grimeli Project is a copper-zinc exploration project around
the site of former copper mines in western Norway. Kodal has
completed exploration consisting of channel sampling, geophysical
survey and drilling. Following an impairment review, the Group has
determined not to invest further in this project or maintain its
licences and has fully impaired the carrying value as at 31 March
2017.
Work programme for 2017/18
The Group has an extensive work programme for 2017/18 which is
principally focussed on its lithium exploration projects in West
Africa, as well as a process of review and prioritisation of
exploration opportunities for the Gold exploration projects.
The primary target of the exploration programme is the continued
exploration and definition of lithium mineralisation at the
Bougouni Project. Kodal has completed two phases of drilling to
date that have returned very encouraging results and we plan to
continue to define and extend these mineralised zones as well as
continue exploration for new targets.
A significant portion of the planned exploration programme is
based on direct drilling of targets, however, additional work
planned also includes surface geochemical sampling, ground
geophysical programmes targeting extensions of identified
structural zones and geological mapping of the project area. In
addition, the Company will continue with the metallurgical testing
and process review that will be of great importance in
demonstrating the development potential of the project.
In addition to the proposed exploration on existing projects,
the Group will continue the process of review, and potential
acquisition, of additional high-value projects that may be
complementary to the existing portfolio and identification of joint
venture partners or realisation of value for the existing
projects.
Future Strategy
The focus of the Company is on the immediate exploration and
definition of the lithium mineralisation at the Bougouni Project in
southern Mali. The Company is currently well-funded to undertake an
aggressive exploration programme of prospect definition and
continued exploration drilling. The Company will continue to review
and assess the potential for future development of the Bougouni
Project.
The Company holds a highly prospective suite of gold assets in
West Africa. The active joint ventures in Côte d'Ivoire are
ensuring that funds are spent advancing exploration on our projects
with the potential for new discovery. The Company is continuing to
assess and rank the projects it holds directly to determine
priorities for further exploration or for ways to deliver value for
our shareholders.
I look forward to being able to report back with positive
news.
Bernard Aylward
Chief Executive Officer
27 September 2017
Finance Review
Results of operations
For the year ended 31 March 2017, the Group reported a loss for
the year of GBP1,178,000 compared to a loss of GBP466,000 in the
previous year. Excluding the impairment charges, outlined further
below, the loss for the year was GBP503,000 compared to GBP415,000
in 2016, reflecting the higher administrative charges of GBP488,000
compared to GBP375,000 in 2016 as operational activity has
expanded, including the running of an office in Mali, following the
acquisition of the gold and lithium exploration assets in West
Africa.
In June 2017, in connection with the preparation of the
financial statements for the year ended 31 March 2017, the
directors undertook an impairment review of the carrying value of
the Grimeli Project in Norway. This has resulted in an impairment
charge in the year to 31 March 2017 of GBP669,000 (2016: GBPnil),
being the full carrying value of the Grimeli Project. In the year
to 31 March 2017, the Group has recognised a further impairment
charge on the Kodal Project of GBP6,000 (2016: GBP50,000),
representing exploration and evaluation costs in the year
associated with the Kodal Project.
During the year, the Group invested GBP1,392,000 in exploration
and evaluation expenditure on its various projects, the large
majority of which related to its West African Gold Projects
acquired in May 2016 and its Mali lithium projects acquired in
August and September 2016. As a result, the carrying value of the
Group's capitalised exploration and evaluation expenditure, net of
the impairment charge relating to the Kodal Project and Grimeli
Project, increased from GBP597,000 to GBP1,323,000. At 31 March
2017, the carrying value of the Gold Projects was GBP714,000 (2016:
GBPnil) and of the lithium projects was GBP609,000 (2016: nil).
Cash balances as at 31 March 2017 were GBP1,723,000, an increase
of GBP1,588,000 on the previous year's level of GBP135,000, with
further funds of GBP3,994,000 having been raised subsequent to the
year-end. Net assets of the Group at the year-end were GBP2,737,000
(2016: GBP704,000).
Financing
During the year, the Group has successfully completed a number
of equity fundraisings. In May 2016, it raised GBP680,000 in
connection with the acquisition of the Gold Projects. Subsequently,
it completed a capital raising in October 2016 of GBP750,000 to
support the initial acquisition of the Lithium Projects, then a
further share placing of GBP1,000,000 in January 2017 to expand the
lithium exploration programme. Most significantly, in March 2017,
Kodal Minerals announced an initial investment of GBP500,000 by
Singapore-based investment company Suay Chin International Pte
Limited, followed after the end of the financial year in May 2017
with the conclusion of a formal subscription agreement with Suay
Chin for a further GBP4,325,000 investment in the Company together
with a binding off-take term sheet covering the Group's lithium
production. This subscription agreement is continuing, with Suay
Chin having completed staged investments since the year end for a
total of GBP3,994,000, bringing its total investment to date to
GBP4,494,000 million out of its overall committed investment of
GBP4,825,000. Suay Chin is now the largest shareholder in the
Company, with a holding of 18.92%. The net proceeds of the
subscriptions from Suay Chin will be used to continue exploration
work on the lithium projects and for general corporate
purposes.
Going concern and funding
The Group has not earned revenue during the year to 31 March
2017 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.
As at 31 March 2017, the Group held cash balances of
GBP1,723,000 and since the end of the financial year the Company
raised GBP3,994,000 by way of a subscription of new shares by Suay
Chin. The Group's cash balances at 31 August 2017 were
GBP4,121,000.
The Directors have prepared cash flow forecasts for the period
ending 30 September 2018. The forecasts include the costs of
progressing the Lithium Projects and the corporate and operational
overheads of the Group. The forecasts demonstrate 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 for a further fund raising.
Accordingly, the financial statements have been prepared on a going
concern basis.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31
MARCH 2017
Note Year Year
ended ended
31 March 31 March
2017 2016
GBP GBP
Continuing operations
Revenue - -
Impairment of exploration
and evaluation assets 7 (675,236) (50,426)
Administrative expenses (488,376) (374,651)
Share based payments 5 (14,667) (40,556)
-------------- ------------
OPERATING LOSS (1,178,279) (465,633)
Finance income - 11
-------------- ------------
LOSS BEFORE TAX 2 (1,178,279) (465,622)
Taxation 6 - -
LOSS FOR THE YEAR FROM
CONTINUING OPERATIONS (1,178,279) (465,622)
OTHER COMPREHENSIVE INCOME
Items that may be subsequently
reclassified to profit
or loss
Currency translation
loss (5,497) (1,142)
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR (1,183,776) (466,764)
============== ============
Loss per share
Basic and diluted - loss
per share on total earnings
(pence) 4 (0.0299) (0.0458)
The loss for the current and prior years and the total
comprehensive income for the current and the prior years are wholly
attributable to owners of the parent company.
CONSOLIDATED AND PARENT COMPANY STATEMENTS OF FINANCIAL POSITION
AS AT 31 MARCH 2017
Group Group Company Company
31 March 31 March 31 March 31 March
2017 2016 2017 2016
Note GBP GBP GBP GBP
NON CURRENT ASSETS
Intangible assets 7 1,323,226 601,391 - -
Property, plant
and equipment 8 - 63,581 - -
Amounts due from
subsidiary undertakings - - 921,198 180,324
Investments in
subsidiary
undertakings 9 - - 512,373 476,752
------------ ------------
1,323,226 664,972 1,433,571 657,076
------------ ------------ ------------ ------------
CURRENT ASSETS
Other receivables 10 16,229 2,984 33,238 15,983
Cash and cash
equivalents 1,722,950 134,801 1,693,016 134,523
------------ ------------ ------------ ------------
1,739,179 137,785 1,726,254 150,506
------------ ------------ ------------ ------------
TOTAL ASSETS 3,062,405 802,757 3,159,825 807,582
------------ ------------ ------------ ------------
CURRENT LIABILITIES
Trade and other
payables 11 (325,213) (98,859) (321,898) (98,767)
------------ ------------
TOTAL LIABILITIES (325,213) (98,859) (321,898) (98,767)
------------ ------------ ------------ ------------
NET ASSETS 2,737,192 703,898 2,837,927 708,815
============ ============
EQUITY
Attributable
to owners of
the parent:
Share capital 12 1,683,206 328,080 1,683,206 328,080
Share premium
account 12 6,784,682 4,937,405 6,784,682 4,937,405
Share based payment
reserve 169,334 154,667 169,334 154,667
Translation reserve (3,597) 1,900 - -
Retained deficit (5,896,433) (4,718,154) (5,799,295) (4,711,337)
------------ ------------ ------------ ------------
TOTAL EQUITY 2,737,192 703,898 2,837,927 708,815
============ ============ ============ ============
The Company's loss for the year ended 31 March 2017 was
GBP1,087,958 (2016: GBP537,084).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
MARCH 2017
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
2015 243,186 4,562,017 114,111 3,042 (4,252,532) 669,824
Comprehensive
income
Loss for the
year - - - - (465,622) (465,622)
Other comprehensive
income
Currency translation
loss - - - (1,142) - (1,142)
-------------
Total comprehensive
income for
the year - - - (1,142) (465,622) (466,764)
Transactions
with owners
Shares in
settlement
of services 15,449 68,837 - - - 84,286
Share based
payment - - 40,556 - - 40,556
Proceeds from
share issue 69,444 330,552 - - - 399,996
Share issue
expenses - (24,000) - - - (24,000)
At 31 March
2016 328,080 4,937,405 154,667 1,900 (4,718,154) 703,898
Comprehensive
income
Loss for the
year - - - - (1,178,279) (1,178,279)
Other comprehensive
income
Currency translation
loss - - - (5,497) - (5,497)
-------------
Total comprehensive
income for
the year - - - (5,497) (1,178,279) (1,183,776)
Transactions
with owners
Shares in
settlement
of services 8,771 22,629 - - - 31,400
Share based
payment - - 14,667 - - 14,667
Proceeds from
share issue 1,346,355 1,993,645 - - - 3,340,000
Share issue
expenses - (168,997) - - - (168,997)
---------- ---------- ---------- -------------- ------------- ------------
At 31 March
2017 1,683,206 6,784,682 169,334 (3,597) (5,896,433) 2,737,192
========== ========== ========== ============== ============= ============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
MARCH 2017
Share
Share based
Share premium payment Retained Total
capital account reserve deficit equity
Company GBP GBP GBP GBP GBP
At 31 March 2015 243,186 4,562,017 114,111 (4,174,253) 745,061
Comprehensive
income
Loss for the year - - - (537,084) (537,084)
Total comprehensive
income for the
year - - - (537,084) (537,084)
Transactions with
owners
Shares in settlement
of services 15,449 68,837 - - 84,286
Share based payments - - 40,556 - 40,556
Proceeds from
shares issued 69,444 330,552 - - 399,996
Share issue expenses - (24,000) - - (24,000)
------------
At 31 March 2016 328,080 4,937,405 154,667 (4,711,337) 708,815
Comprehensive
income
Loss for the year - - - (1,087,958) (1,087,958)
Total comprehensive
income for the
year - - - (1,087,958) (1,087,958)
Transactions with
owners
Shares in settlement
of services 8,771 22,629 - - 31,400
Share based payment - - 14,667 - 14,667
Proceeds from
shares issued 1,346,355 1,993,645 - - 3,340,000
Share issue expenses - (168,997) - - (168,997)
At 31 March 2017 1,683,206 6,784,682 169,334 (5,799,295) 2,837,927
========== ========== ========== ============ ============
CONSOLIDATED AND PARENT COMPANY STATEMENTS OF CASH FLOWS FOR THE
YEARED 31 MARCH 2017
Group Group Company Company
Year Year Year Year
ended ended ended ended
31 March 31 March 31 March 31 March
2017 2016 2017 2016
Note GBP GBP GBP GBP
Cash flows from
operating activities
Loss before tax (1,178,279) (465,622) (1,087,958) (537,084)
Adjustments for
non-cash items:
Loss on sale of - -
property, plant
and equipment 41,994 -
Impairment of exploration
and evaluation
assets 7 675,236 50,426 - -
Impairment of investments
in subsidiaries
and intercompany
balances - - 653,887 11,485
Share based payments 14,667 40,556 14,667 40,556
Equity settled
transactions -
other 20,000 - 20,000 -
Operating cash
flow before movements
in working capital (426,382) (374,640) (399,404) (485,043)
Movement in working
capital
(Increase) / decrease
in receivables (13,245) 25,111 (17,255) 13,707
Increase / (decrease)
in payables 220,858 (14,856) 223,131 5,955
------------ ---------- -------------- ------------
Net movements in
working capital 207,613 10,255 205,876 19,662
Net cash inflow
/ (outflow) from
operating activities (218,769) (364,385) (193,528) (465,381)
Cash flows from
investing activities
Purchase of subsidiary (102,373) -
undertakings - -
Disposal of property, - -
plant and equipment 10,000 -
Purchase of intangible
assets (961,205) (182,764) - (11,485)
Loans to subsidiary
undertakings - - (906,609) (66,038)
------------ ---------- -------------- ------------
Net cash outflow
from investing
activities (951,205) (182,764) (1,008,982) (77,523)
Cash flow from
financing activities
Interest received - 11 - -
Net proceeds from
share issues 12 2,761,003 375,996 2,761,003 375,996
Net cash inflow
from financing
activities 2,761,003 376,007 2,761,003 375,996-
------------ ---------- -------------- ------------
Increase / (decrease)
in cash and cash
equivalents 1,591,029 (171,142) 1,558,493 (166,908)
Cash and cash equivalents
at beginning of
the year 134,801 306,843 134,523 301,431
Exchange loss on
cash (2,880) (900) - -
Cash and cash equivalents
at end of the year 1,722,950 134,801 1,693,016 134,523
============ ========== ============== ============
Cash and cash equivalents comprise cash on hand and bank
balances.
Financial Information
The financial information set out above does not constitute the
Company's statutory accounts for the years ended 31 March 2017 or
2016 but is derived from those accounts. Statutory accounts for
2016 have been delivered to the registrar of companies, and those
for 2017 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 2017 Annual Report and Accounts and Notice of the 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 31 October 2017.
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 Financial Reporting Standards
("IFRSs"), as adopted by the European Union ("EU") and in
accordance with the provisions of the Companies Act 2006. The
Company's ordinary shares are quoted on AIM, a market operated by
the London Stock Exchange.
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. IFRSs 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.
Licence renewals
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.
At the date of these financial statements, the majority of the
Group's exploration licences in Mali and Côte d'Ivoire are due for
renewal or extension. 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. In all cases, applications for renewal or
extension of these licences have been submitted, and associated
fees paid, as they became due. Accordingly, the directors have no
reason to believe that the applications for these renewals and
extensions will not be successful.
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.
In connection with the preparation of the financial statements
for the year ended 31 March 2017, the directors undertook an
impairment review of the carrying value of the Grimeli Project in
Norway. The impairment review was conducted following an assessment
by the directors of the exploration data on the Grimeli Project
which led to a decision not to commit any further expenditure to
the project. The Company expects to relinquish these licence areas
at the next renewal date. The impairment review has resulted in an
impairment charge in the year to 31 March 2017 of GBP669,000 (2016:
GBPnil), being the full carrying value of the Grimeli Project.
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 Company to advance these prospective areas
most effectively. Accordingly, no impairment review has been
conducted on these assets.
In connection with the preparation of the financial statements
for the year ended 31 March 2015, the directors undertook an
impairment review of the carrying value of the Kodal Project in
Norway in response to the significant fall in the price of iron
ore, by performing a value in use calculation. As a result of this
review, the Kodal Project was fully impaired and its value in the
financial statements written down to nil. In the year to 31 March
2017, the Group has recognised a further impairment charge on the
Kodal Project of GBP6,000 (2016: GBP50,000), representing
exploration and evaluation costs in the year associated with the
project. At 31 March 2017 the carrying value of the Kodal Project
was GBPnil compared to GBPnil in 2016. No further expenditure is
being incurred on the Kodal Project other than the costs of
maintaining the extraction and exploration licences and limited
consulting work to advance the Norwegian planning application.
Acquisition of International Goldfields (Bermuda) Limited ("IG
Bermuda")
On 20 May 2016, Kodal Minerals plc completed the acquisition of
IG Bermuda which through its four subsidiaries has interests in a
number of gold exploration projects in Mali and C te d'Ivoire in
Western Africa. Including fees and expenses, the total cost of the
acquisition was GBP512,373. Due to the lack of processes and
outputs relating to IG Bermuda at the time of purchase, the Board
does not consider the entities acquired to meet the definition of a
business. As such, the Group has accounted for the acquisition of
IG Bermuda as an asset purchase.
Going concern
The Group has not earned revenue during the year to 31 March
2017 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.
As at 31 March 2017, the Group held cash balances of
GBP1,723,000 and following the end of the financial year the
Company raised GBP3,994,000 by way of a subscription of new shares.
The Group's cash balances at 31 August 2017 were GBP4,121,000.
The Directors have prepared cash flow forecasts for the period
ending 30 September 2018. The forecasts include the costs of
progressing the Lithium Projects and the corporate and operational
overheads of the Group. The forecasts demonstrate 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 for a further fund raising.
Accordingly, the financial statements have been prepared on a going
concern basis.
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARED 31 MARCH
2017
1. SEGMENTAL REPORTING
The operations and assets of the Group in the year ended 31
March 2017 are focused in the United Kingdom, West Africa and
Norway and comprise one class of business: the exploration and
evaluation of mineral resources. Management have determined that
the Group had four operating segments being the West African Gold
Projects, the West African Lithium Projects, the Norway Projects
and the UK administration operations. The Parent Company acts as a
holding company. At 31 March 2017, the Group had not commenced
commercial production from its exploration sites and therefore had
no revenue for the year.
Year ended 31 West West
March 2017 UK Africa Africa Norway Total
Gold Lithium
GBP GBP GBP GBP GBP
Administrative
expenses (443,035) (160) (160) (45,021) (488,376)
Impairment charge - - - (675,236) (675,236)
Share based
payments (14,667) - - - (14,667)
Loss for the
year (457,702) (160) (160) (720,257) (1,178,279)
---------- -------- ---------- ---------- ------------
At 31 March
2017
Other receivables 13,189 - 1,040 2,000 16,229
Cash and cash
equivalents 1,693,016 11,423 11,423 7,088 1,722,950
Trade and other
payables (170,137) - (155,076) - (325,213)
Intangible assets
- exploration
and evaluation
expenditure - 714,085 609,141 - 1,323,226
Net assets at
31 March 2017 1,536,068 725,508 466,528 9,088 2,737,192
---------- -------- ---------- ---------- ------------
Year ended 31 West West
March 2016 UK Africa Africa Norway Total
Gold Lithium
GBP GBP GBP GBP GBP
Finance income - - - 11 11
Administrative
expenses (353,980) - - (20,671) (374,651)
Impairment charge - - - (50,426) (50,426)
Share based
payments (40,556) - - - (40,556)
Loss for the
year (394,536) - - (71,086) (465,622)
---------- -------- -------- --------- ----------
At 31 March
2016
Other receivables - - - 2,984 2,984
Cash and cash
equivalents 134,523 - - 278 134,801
Trade and other
payables (98,859) - - - (98,859)
Intangible assets
- software - - - 4,836 4,836
Intangible assets
- exploration
and evaluation
expenditure - - - 596,555 596,555
Property plant
and equipment - - - 63,581 63,581
---------- -------- -------- --------- ----------
Net assets as
at 31 March
2016 35,664 - - 668,234 703,898
---------- -------- -------- --------- ----------
2. LOSS BEFORE TAX
The loss before tax from continuing activities is stated after
charging:
Group Group
Year ended Year ended
31 March 31 March
2017 2016
GBP GBP
Impairment of intangible
assets 675,236 50,426
Fees payable to the
Company's auditor 37,500 22,500
Share based payments 14,667 40,556
Directors' salaries
and fees 96,815 120,000
Employer's National
Insurance 2,311 8,442
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
2017 2016
GBP GBP
Audit services
- statutory audit of parent
and consolidated accounts 27,500 20,000
- statutory audit of subsidiaries 2,500 2,500
- review of interim accounts 7,500 -
37,500 22,500
------------ ------------
3. EMPLOYEES' AND DIRECTORS' REMUNERATION
The average number of people employed in the Group is as
follows:
Group Group Company Company
31 March 31 March 31 March 31 March
2017 2016 2017 2016
Number Number Number Number
Average number
of employees
(including
directors): 6 4 3 4
---------- ---------- ---------- ----------
The remuneration expense for directors of the Company is as
follows:
Year ended Year ended
31 March 31 March
2017 2016
GBP GBP
Directors' remuneration 96,815 120,000
Directors' social security
costs 2,311 8,442
----------- -----------
Total 99,126 128,442
----------- -----------
Directors' Share
salary based
and fees payments Total
year ended year ended year ended
31 March 31 March 31 March
2017 2017 2017
GBP GBP GBP
Luke Bryan (1) 24,077 14,667 38,744
Markus Ekberg 1,667 - 1,667
David Jones 8,769 - 8,769
Robert Wooldridge 30,635 - 30,635
Bernard Aylward
(2) 31,667 - 31,667
96,815 14,667 111,482
============ ============ =============
Directors' Share based
salary payments Total
and fees year ended year ended
year ended 31 March 31 March
31 March 2016 2016
2016
GBP GBP GBP
Luke Bryan (1) 50,000 25,347 75,347
Markus Ekberg 20,000 - 20,000
David Jones 30,000 - 30,000
Robert Wooldridge 20,000 - 20,000
------------ ------------ -------------
120,000 25,347 145,347
------------ ------------ -------------
1 In addition to the amounts included above, Novoco Mine
Engineering Limited, a company wholly owned by Luke Bryan, provided
consultancy services to the Group during the year and received fees
of GBP24,300 (2016: GBP46,750).
2 In addition to the amounts included above, Matlock Geological
Services Pty Ltd, a company wholly owned by Bernard Aylward,
provided consultancy services to the Group during the year and
received fees of GBP91,106 (2016: GBPnil).
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 Basic
average loss per
number share
of shares (pence)
GBP
Year ended
31 March 2017 (1,178,279) 3,942,928,822 0.0299
Year ended
31 March 2016 (465,622) 1,015,307,538 0.0458
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 31 March
2017 2016
Share options outstanding GBP GBP
Opening balance 40,000,000 40,000,000
Issued in the period - -
Closing balance 40,000,000 40,000,000
============= =============
Options issued in the year to 31 March 2014
In respect of services provided in connection with the Company's
admission to AIM, the Company entered into option agreements dated
20 December 2013 between the Company and Novoco Mine Engineering
Limited ("Novoco"), a company wholly owned by Luke Bryan, and
between the Company and David Hakes (a consultant to the Group at
the time). Under these agreements, the Company granted to Novoco
and David Hakes respectively options over 25,000,000 shares and
15,000,000 shares ("Option Shares") at an exercise price of 0.7
pence per share. The options become exercisable in respect of one
third of the total number of Option Shares on each of the first,
second and third anniversaries of 30 December 2013. The options are
exercisable for a period of ten years from the date on which they
vest and become exercisable.
Details of share options outstanding at 31 March 2017:
Date of grant Number of options Option price Exercisable
between
30 December 2013 13,333,333 0.7 pence 30 Dec 2014 - 30 Dec
2024
30 December 2013 13,333,333 0.7 pence 30 Dec 2015 - 30 Dec
2025
30 December 2013 13,333,333 0.7 pence 30 Dec 2016 - 30 Dec
2026
Included within operating losses is a charge for issuing share
options and making share based payments of GBP14,667 (2016:
GBP40,556) which was recognised in accordance with the Group's
accounting policies.
Additional disclosure information:
Weighted average exercise price of share options:
-- outstanding at the beginning of the period 0.7 pence
-- granted during the period N/A
-- outstanding at the end of the period 0.7 pence
-- exercisable at the end of the period 0.7 pence
Weighted average remaining contractual life of
share options outstanding at the end of the period 8.76 years
Tetra Option Agreement
In December 2013, the Group entered into an option agreement
(the "Agreement") with Tetra Minerals Oy ("Tetra") a company
registered in Finland, under which it granted to Tetra an option
(the "Option") to subscribe for new shares in the Company. Under
the terms of the Agreement, which is governed by English law, Tetra
could not assign its right to the Option to another party. In March
2017, Kodal was informed that on 1 February 2017, under a demerger
plan in accordance with Finnish law, Tetra's assets had been
transferred equally to two new Finnish companies and Tetra had been
dissolved. The Company believes, based on legal advice, that as a
result of the restriction in the Agreement on assigning the Option
and the dissolution of Tetra, the Option is no longer capable of
being exercised.
The maximum number of shares that are subject to the Option is
714,285,714, corresponding to the number of shares that would be
issued for a total amount of GBP5 million at 0.7 pence per share.
Once vested, each tranche of the Option may be exercised by Tetra
at a subscription price of 10p per share for a period of three
years after the date on which each tranche vests. The Option vests
and becomes exercisable in tranches only once the JORC indicated
resource for phosphate minerals at the Kodal Project meets certain
thresholds from 90m tonnes to 170m tonnes. These thresholds are
well beyond the size of the current targeted ore body, which has a
JORC mineral resource of 48.9m tonnes. Unless and until further
exploration of the Kodal Project identifies a further potential ore
body the likelihood of the thresholds being met is considered to be
remote.
The Board has reviewed the Tetra option arrangements and
determined that the fair value of the Tetra Option is GBPnil on the
grounds that Tetra has been dissolved and is no longer capable of
exercising the Option and that the likelihood of the options
vesting is remote.
6. TAXATION
Group Group
Year ended Year ended
31 March 2017 31 March
2016
GBP GBP
Taxation charge for the - -
year
--------------- ------------
Factors affecting the
tax charge for the year
Loss from continuing
operations before income
tax (1,178,279) (465,622)
Tax at 20% (2016: 20%) (235,656) (93,124)
Expenses not deductible 232 53
Overseas rate differences - (3,043)
Losses carried forward
not deductible 89,044 78,287
Other temporary differences 137,981 29,135
Non-current assets temporary
differences 8,399 (11,308)
Income tax expense - -
=============== ============
The Group has tax losses and other potential deferred tax assets
totalling GBP790,000 (2016: GBP582,000) 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 Software Total
GROUP GBP GBP GBP
COST
At 1 April 2015 3,696,562 27,295 3,723,857
Additions in the
year 362,600 - 362,600
Effects of foreign
exchange (517) - (517)
---------------- --------- ----------
At 1 April 2016 4,058,645 27,295 4,085,940
Additions in the
year - acquisition
of IG Bermuda 535,134 - 535,134
Additions in the
year - other expenditure 857,022 - 857,022
Disposals in the
year - (27,295) (27,295)
Effects of foreign
exchange 9,751 - 9,751
---------------- --------- ----------
At 31 March 2017 5,460,552 - 5,460,552
AMORTISATION
At 1 April 2015 3,411,664 13,452 3,425,116
Amortisation charge - 9,007 9,007
Impairment (see note
below) 50,426 - 50,426
---------------- --------- ----------
At 31 March 2016 3,462,090 22,459 3,484,549
Amortisation charge - 3,306 3,306
Disposals in the
year - (25,765) (25,765)
Impairment (see note
below) 675,236 - 675,236
At 31 March 2017 4,137,326 - 4,137,326
---------------- --------- ----------
NET BOOK VALUES
At 31 March 2017 1,323,226 - 1,323,226
================ ========= ==========
At 31 March 2016 596,555 4,836 601,391
================ ========= ==========
At 31 March 2015 284,898 13,843 298,741
================ ========= ==========
In connection with the preparation of the financial statements
for the year ended 31 March 2017, the directors undertook an
impairment review of the carrying value of the Grimeli Project in
Norway. The impairment review was conducted following an assessment
by the directors of the exploration data on the Grimeli Project
which led to a decision not to commit any further expenditure to
the project. The Company expects to relinquish these licence areas
at the next renewal date. The impairment review has resulted in an
impairment charge in the year to 31 March 2017 of GBP669,000 (2016:
GBPnil), being the full carrying value of the Grimeli Project.
In connection with the preparation of the financial statements
for the year ended 31 March 2015, the directors undertook an
impairment review of the carrying value of the Kodal Project in
Norway in response to the significant fall in the price of iron
ore, by performing a value in use calculation. As a result of this
review, the Kodal Project was fully impaired and its value in the
financial statements written down to nil. In the year to 31 March
2017, the Group has recognised a further impairment charge on the
Kodal Project of GBP6,436 (2016: GBP50,426), representing
exploration and evaluation costs in the year associated with the
project. At 31 March 2017, the carrying value of the Kodal Project
was GBPnil compared to GBPnil in 2016. No further expenditure is
being incurred on the Kodal Project other than the costs of
maintaining the extraction and exploration licences and limited
consulting work to advance the Norwegian planning application.
At the date of these financial statements, the majority of the
Group's exploration licences in Mali and Côte d'Ivoire are due for
renewal or extension. 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. In all cases, applications for renewal or
extension of these licences have been submitted, and associated
fees paid, as they became due. Accordingly, the directors have no
reason to believe that the applications for these renewals and
extensions will not be successful.
8. PROPERTY, PLANT AND EQUIPMENT
Fixtures,
fittings Plant Motor
and equipment and machinery vehicles Total
GROUP GBP GBP GBP GBP
COST
At 1 April
2015 96,448 30,673 19,758 146,879
Effects of
foreign exchange 149 85 93 327
--------------- --------------- ---------- ----------
At 1 April
2016 96,597 30,758 19,851 147,206
Disposals
in the year (96,597) (30,758) (19,851) (147,206)
--------------- --------------- ---------- ----------
At 31 March
2017 - - - -
DEPRECIATION
At 1 April
2015 16,383 4,803 5,833 27,019
Depreciation
charge 17,036 4,405 4,969 26,410
Impairment
charge/write
off 20,393 9,738 - 30,131
Effects of
foreign exchange 20 18 27 65
--------------- --------------- ---------- ----------
At 1 April
2016 53,832 18,964 10,829 83,625
Depreciation
charge 8,704 2,248 2,668 13,620
Disposals
in the year (62,536) (21,212) (13,497) (97,245)
--------------- --------------- ---------- ----------
At 31 March
2017 - - - -
--------------- --------------- ---------- ----------
NET BOOK VALUES
At 31 March
2017 - - - -
=============== =============== ========== ==========
At 31 March
2016 42,765 11,794 9,022 63,581
=============== =============== ========== ==========
At 31 March
2015 80,065 25,870 13,925 119,860
=============== =============== ========== ==========
For those tangible assets wholly associated with exploration and
development projects, the amounts charged in respect of
depreciation are capitalised as evaluation and exploration assets
within intangible assets. The assets disposed of in the year all
related to the projects in Norway.
The Company did not have any Property, Plant and Equipment as at
31 March 2015, 2016 and 2017.
9. INVESTMENTS IN SUBSIDIARY UNDERTAKINGS
The consolidated financial statements include the following
subsidiary companies:
Country Registered office Equity Nature
Company Subsidiary of holding of
of incorporation business
Kodal Kodal United Prince Frederick 100% Operating
Norway Minerals Kingdom House, company
(UK) Ltd Plc 35-39 Maddox
Street, London
W1S 2PP
Kodal Kodal Norway c/o Tenden Advokatfirma 100% Mining
Mining Norway ANS, exploration
AS (UK) Ltd 3210 Sandefjord
Norway
Kodal Kodal Norway c/o Tenden Advokatfirma 100% Mining
Phosphate Norway ANS, exploration
AS (UK) Ltd 3210 Sandefjord
Norway
International Kodal Bermuda MQ Services Ltd 100% Holding
Goldfields Minerals Victoria Place, company
(Bermuda) Plc 31 Victoria Street,
Limited Hamilton HM 10
Bermuda
International International Côte Abidjan Cocody 100% Mining
Goldfields Goldfields d'Ivoire Les Deux Plateaux exploration
Côte (Bermuda) 7eme Tranche
d'Ivoire Limited BP Abidjan
SARL Côte d'Ivoire
International International Mali Bamako, Faladi, 100% Mining
Goldfields Goldfields Mali Univers, exploration
Mali SARL (Bermuda) Rue 886 B, Porte
Limited 487
Mali
Jigsaw International Bermuda MQ Services Ltd 100% Mining
Resources Goldfields Victoria Place, exploration
CIV Ltd (Bermuda) 31 Victoria Street,
Limited Hamilton HM 10
Bermuda
Corvette International Côte Abidjan Cocody 100% Mining
CIV SARL Goldfields d'Ivoire Les Deux Plateaux exploration
(Bermuda) 7eme Tranche
Limited BP Abidjan
Côte d'Ivoire
Future International Bermuda MQ Services Ltd 100% Mining
Minerals Goldfields Victoria Place, exploration
Limited (Bermuda) 31 Victoria Street,
Limited Hamilton HM 10
Bermuda
Year ended Year ended
Carrying value of investment 31 March 31 March
in subsidiaries 2017 2016
Opening balance 476,752 476,752
Acquisition of IG Bermuda 512,373 -
(see below)
Impairment in the year (476,752) -
Closing balance 512,373 476,752
=========== ===========
Acquisition of International Goldfields (Bermuda) Limited ("IG
Bermuda")
On 20 May 2016, Kodal Minerals Plc completed the acquisition of
IG Bermuda which through its four subsidiaries has interests in a
number of gold exploration projects in Mali and C te d'Ivoire in
Western Africa. The consideration of GBP410,000 was satisfied by
the issue of 1,025,000,000 ordinary shares of the Company, which
were issued to Taruga Gold Limited ("Taruga"), a company listed on
the Australian Stock Exchange and the previous owner of IG Bermuda.
The consideration shares were subsequently distributed by Taruga to
its shareholders as an in specie distribution. Due to the lack of
processes and outputs relating to IG Bermuda at the time of
purchase, the Board does not consider the entities acquired to meet
the definition of a business. As such, the Group has accounted for
the acquisition of IG Bermuda as an asset purchase.
IG Bermuda and its subsidiaries has interests in four licences
in Mali and four exploration licences plus two further licence
applications in C te d'Ivoire including a farm-in agreement with
Newcrest Mining Limited over one of the C te d'Ivoire licences and
a joint venture agreement with Resolute Mining Limited over three
licences and one licence application in C te d'Ivoire.
Including fees and expenses, the total cost of the acquisition
was GBP512,373. The relative fair values of the identifiable assets
and liabilities acquired and included in the consolidation are:
GBP
Intangible assets - exploration
and evaluation 535,134
Cash 39
Other liabilities (22,800)
---------
512,373
---------
10. OTHER RECEIVABLES
Group Group Company Company
31 March 31 March 31 March 31 March
2017 2016 2017 2016
GBP GBP GBP GBP
Other receivables 16,229 2,984 33,238 15,983
16,229 2,984 33,238 15,983
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.
11. TRADE AND OTHER PAYABLES
Group Group Company Company
31 March 31 March 31 March 31 March
2017 2016 2017 2016
GBP GBP GBP GBP
Trade payables 238,200 73,507 238,200 73,409
Other payables 87,013 25,352 83,698 25,358
325,213 98,859 321,898 98,767
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:
Nominal Number Share Capital Share
Value of Ordinary GBP Premium
Shares GBP
At 31 March
2015 778,194,606 243,186 4,562,017
Issue (Note
1) GBP0.0003125 222,222,222 69,445 306,551
Issue (Note
2) GBP0.0003125 22,867,135 7,146 35,158
Issue (Note
3) GBP0.0003125 26,570,886 8,303 33,679
---------------- -------------- ------------
At 31 March
2016 1,049,854,849 328,080 4,937,405
Issue (Note
4) GBP0.0003125 1,025,000,000 320,313 89,687
Issue (Note
5) GBP0.0003125 1,700,000,000 531,250 108,900
Issue (Note
6) GBP0.0003125 771,400,000 241,063 486,237
Issue (Note
7) GBP0.0003125 673,333,334 210,417 739,536
Issue (Note
8) GBP0.0003125 166,666,667 52,083 422,917
At 31 March
2017 5,386,254,850 1,683,206 6,784,682
---------------- -------------- ------------
Share issue costs have been allocated against the Share Premium
reserve.
Note 1: On 14 May 2015, a total of 222,222,222 shares were
issued in a placing at an issue price of 0.18 pence per share.
Note 2: On 19 May 2015, a total of 22,867,135 shares were issued
to a supplier of the Company in part settlement of the services
provided at an issue price of 0.185 pence per share.
Note 3: On 22 June 2015, a total of 26,570,886 shares were
issues to a supplier of the Company in part settlement of the
services provided at an issue price of 0.158 pence per share.
Note 4: On 20 May 2016, a total of 1,025,000,000 shares were
issued to Taruga Gold Limited in consideration for the acquisition
of the issued share capital of International Goldfields (Bermuda)
Limited. The shares were issued at an issue price of 0.04 pence per
share.
Note 5: On 20 May 2016, a total of 1,700,000,000 shares were
issued in a placing at an issue price of 0.04 pence per share.
Note 6: On 3 October 2016, a total of 720,000,000 shares were
issued in a placing and a total of 51,400,000 shares were issued to
suppliers of the Company in part settlement of the services
provided, in each case at an issue price of 0.1 pence per
share.
Note 7: On 13 January 2017, a total of 666,666,667 shares were
issued in a placing and a total of 6,666,667 shares were issued to
a supplier of the Company in part settlement of the services
provided, in each case at an issue price of 0.15 pence per
share.
Note 8: On 10 March 2017, a total of 166,666,667 shares were
issued in a subscription at an issue price of 0.3 pence per
share.
13. RESERVES
Reserve Description and purpose
Share premium Amount subscribed for share capital
in excess of nominal value.
Share based Cumulative fair value of options and
payment reserve 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 Gains/losses arising on re-translating
reserve 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 2017 earned interest of GBPnil
(2016: GBPnil). 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.
Other financial
Loans liabilities
and receivables at amortised Total
cost
31 March 2017 GBP GBP GBP
Assets
Other receivables 16,229 - 16,229
Cash and cash equivalents 1,722,950 - 1,722,950
------------------ ---------------- ------------
Total 1,739,179 - 1,739,179
================== ================ ============
Liabilities
Trade and other payables - 325,213 325,213
Total - 325,213 325,213
================== ================ ============
31 March 2016
Assets
Other receivables 2,984 - 2,984
Cash and cash equivalents 134,801 - 134,801
------------------ ---------------- ------------
Total 137,785 - 137,785
================== ================ ============
Liabilities
Trade and other payables - 98,859 98,859
------------------ ---------------- ------------
Total - 98,859 98,859
================== ================ ============
Foreign exchange risk
Throughout the periods presented in the consolidated financial
statements, the functional currency for the Group's Norwegian
subsidiaries has been the Norwegian Kronor and for the Group's West
African subsidiaries has been the CFA Franc.
The Group incurs certain exploration costs in Norwegian Kronor,
the CFA Franc and US Dollars and has exposure to foreign exchange
rates prevailing at the dates when Sterling funds are translated
into other currencies. 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, Norway
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.
GBP denominated NOK XOF denominated
denominated Total
31 March 2017 GBP GBP GBP GBP
Assets
Other receivables 15,189 - 1,040 16,229
Cash and cash
equivalents 1,693,016 7,088 22,846 1,722,950
---------------- ------------- ---------------- ----------
Total 1,708,205 7,088 23,886 1,739,179
================
Liabilities
Trade and other
payables 325,213 - - 325,213
================
31 March 2016
Assets
Trade and other
receivables 2,984 - - 2,984
Cash and cash
equivalents 134,540 261 - 134,801
---------------- ------------- ---------------- ----------
Total 137,524 261 - 137,785
================
Liabilities
Trade and other
payables 98,756 103 - 98,859
---------------- ------------- ================ ----------
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 noted above.
15. RELATED PARTY TRANSACTIONS
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 2017, the Company
paid fees to SP Angel of GBP148,891 (2016: GBP49,000) for its
services as broker.
Novoco Mine Engineering Limited ("Novoco"), a company wholly
owned by Luke Bryan, a Director, provided consultancy services to
the Group during the year ended 31 March 2017 and received fees of
GBP24,300 (2016: GBP46,750).
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 2017 and received fees
of GBP91,106 (2016: GBPnil).
16. CONTROL
No one party is identified as controlling the Group.
17. EVENTS AFTER THE REPORTING PERIOD
In May 2017, the Company raised GBP3,994,000 by way of two
further subscriptions totalling 1,051,131,025 ordinary shares at
0.38 pence per share by Singapore-based Suay Chin International
Pte. The net proceeds of the subscriptions will be used to continue
exploration work on the Lithium Projects and for general corporate
purposes.
On 8 May 2017, the Company granted share options to directors
and certain key personnel over a total of 145 million ordinary
shares, including options over 50 million shares to each of Bernard
Aylward and Luke Bryan and options over 25 million shares to Robert
Wooldridge. All options are exercisable at a price of 0.38 pence
per share and have a life of 5 years from vesting. 50 per cent of
the options vested immediately with a further 25% vesting after one
year and the remaining 25 per cent vesting after two years.
On 22 May 2017, the Company issued warrants over 25,000,000
ordinary shares to SP Angel Corporate Finance LLP in respect of
additional services provided by it to the Company since its
admission to AIM and for advice and assistance in respect of the
investment by Suay Chin International Pte and associated
agreements. The warrants are exercisable at 0.38 pence per share
and have a life of 5 years from vesting. 50 per cent of the options
vested immediately with a further 25% vesting after one year and
the remaining 25 per cent vesting after two years.
**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 Tel: 020 3328
Jeremy Porter/Nick Harriss 5656
SP Angel Corporate Finance LLP,
Financial Adviser & Broker Tel: 020 3470
John Mackay 0470
St Brides Partners Ltd, Financial
PR Tel: 020 7236
Susie Geliher/Lottie Brocklehurst/Megan 1177
Dennison
This information is provided by RNS
The company news service from the London Stock Exchange
END
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