TIDMMILA
RNS Number : 8206M
Mila Resources PLC
25 January 2021
Mila Resources Plc / Index: LSE / Epic: MILA / Sector: Natural
Resources
25 January 2021
Mila Resources Plc
("Mila" or "the Company")
Final Results
Mila Resources Plc, a London listed natural resources company,
is pleased to present its final results for the year ended 30 June
2020.
Statement from the Board
We have pleasure in presenting the financial statements for the
year ended 30 June 2020.
The last year while challenging has created exceptional
opportunities for investment in the resource sector. We were
extremely disappointed that the transaction to acquire 100% of the
share capital of E-Tech Metals Ltd was terminated without cause as
we had materially advanced the due diligence process and the
preparation of a prospectus. We however quickly identified New
Generation Metals Limited ("NGM") as an exceptional alternative and
have managed to preserve much of the prospectus preparation that we
had completed to smoothly change to the proposed new
transaction.
New Generation Minerals
NGM is a UK private company, whose principal asset is the
Kathleen Valley gold project ("Project") in Western Australia. The
Project is located in the prolific Wiluna-Norseman gold belt which
hosts several world-class mines owned by a number of premier
Australian gold companies including Northern Star and St Barbara.
NGM holds other nickel and cobalt assets in Western Australia
including a JORC inferred resource of 3.8 Mt Nickel-Cobalt project
and one copper-gold project in Argentina.
The Kathleen Valley gold project has been discovered next door
and on strike to recent discoveries by ASX listed Bellevue Gold, a
company that has made substantial discoveries in the region
particularly with the Deacon and Viago extensions of the historic
Bellevue mine located 7km south of the Project. In June 2020,
Bellevue made a discovery at its Government Well prospect, which is
on the western boundary of the NGM Project. Bellevue has grown
substantially in the last year, and now has a market capitalisation
of over A$1.1 billion.
NGM built its land package by consolidating control of several
groups. In May 2019, NGM commenced drilling at the Project and made
its first discovery holes. NGM carried out further drilling in
September 2020 with peak gold grades of 13.95 g/t. NGM intends to
continue to drill intensively and develop the mineral resource at
the Project using funds raised from its existing shareholders and
from a placing intended to take place at the time of the Proposed
Transaction.
The Proposed Transaction remains subject to due diligence,
completion of the acquisition and re-listing of the enlarged group
on the Official List.
Financial
Funding
The Company is funded through investment from its Shareholders
following the Company's successful Standard Listing IPO onto the
London Stock Exchange in 2016, raising GBP1.05 million before
costs.
Expenditure
During the year, the Company has continued its fiscal discipline
with the Company continuing to maintain low overheads. Any monies
spent on business development opportunities has only occurred after
a particular project has passed our initial technical review.
Current Assets
At 30 June 2020, the Company was owed GBP85,849 (2019: GBPNil)
in respect of a secured loan provided to the RTO target E-Tech
Metals Limited ('E-Tech') during the year. This loan was fully
repaid in November 2020, see note 22 Subsequent Events.
Liquidity, cash and cash equivalents
At 30 June 2020, the Company held GBP186,316 (2019: GBP428,673)
of cash and cash equivalents, all of which are denominated in
pounds sterling. It should be noted that the outstanding loan due
from E-Tech was subsequently repaid after year and as a result does
not form part of this balance of "Liquidity, cash and cash
equivalents."
Mark Stephenson
Executive Director
25 January 2021
Strategic Report
Understanding our business
The Company was incorporated on 3 June 2015, with the view of
pursuing an initial public offering of its securities onto the
London Stock Exchange through a Standard Listing to raise the
necessary funds required for the execution of the business
strategy, which is to acquire a business or asset.
This IPO was completed during 2016, with the Company
successfully raising GBP1,050,000 before costs with Admission to
the Main Market of the London Stock Exchange in October 2016.
Key performance indicators
Appropriate key performance indicators will be identified in due
course as the business strategy is implemented following a
successful acquisition. Given the current nature of the Company's
business, the Directors are of the opinion that the primary
performance indicator is the completion of an acquisition.
Business review
For a review of developments in the year, please see page 4, the
"Statement from the board".
Principal risks and uncertainties
The principal risks currently faced by the Company relate
to:
Acquiring Less than Controlling Interests
The Company may acquire either less than whole voting control
of, or less than a controlling equity interest in, a target, which
may limit the Company's operational strategies and reduce its
ability to enhance Shareholder value.
Inability to Fund Operations Post-Acquisition
The Company may be unable to fund the operations post
acquisition of the target business if it does not obtain additional
funding, however, the Company will ensure that appropriate funding
measures are taken to ensure minimum commitments are met. The
current global pandemic, Covid-19, may make obtaining of sufficient
funds more challenging.
The Company's Relationship with the Directors and Conflicts of
Interest
The Company is dependent on the Directors to identify potential
acquisition opportunities and to execute an acquisition.
The Directors are not obliged to commit their whole time to the
Company's business; they will allocate a portion of their time to
other businesses which may lead to the potential for conflicts of
interest in their determination as to how much time to assign to
the Company's affairs.
Suitable Acquisition Opportunities may not be Identified or
Completed
The Company's business strategy is dependent on the ability of
the Directors to identify sufficient suitable acquisition
opportunities. If the Directors do not identify a suitable
acquisition target, the Company may not be able to fulfil its
objectives. Furthermore, if the Directors do not identify a
suitable target, the Company may not acquire it at a suitable price
or at all. In addition, if an acquisition identified and
subsequently aborted the Company may be left with substantial
transaction costs.
Risks Inherent in an Acquisition
Although the Company and the Directors will evaluate the risks
inherent in a particular target, they cannot offer any further
assistance that all of the significant risk factors can be
identified or properly assessed. Furthermore, no assurance can be
made that an investment in Ordinary Shares in the Company will
ultimately prove to be more favourable to investors then a direct
investment, if such an opportunity were available, in a target
business.
Reliance on External Advisors
The Directors expect to rely on external advisors to help
identify and assess potential acquisitions and there is a risk that
suitable advisors cannot be placed under contract or that such
advisors that are contracted to fail to perform as required.
Failure to Obtain Additional Financing to Complete an
Acquisition or Fund a Target's Operations
There is no guarantee that the Company will be able to obtain
any additional financing needed to either complete an acquisition
or to implement its plans post acquisition or, if available, to
obtain such financing on terms attractive to the Company. In that
event, the Company may be compelled to restructure or abandon the
acquisition or proceed with the acquisition on less favourable
terms, which may reduce the Company's return on the investment. The
failure to secure additional financing on acceptable terms could
have a material adverse effect on the continued development or
growth of the Company and the acquired business. The current global
pandemic, Covid-19, may make obtaining of sufficient funds more
challenging.
Reliance on Income from the Acquired Activities
Following an acquisition, the Company may be dependent on the
income generated by the acquired business or from the subsequent
divestment of the acquired business to meet the Company's expenses.
If the acquired business is unable to provide the sufficient
amounts to the Company, the Company may be unable to pay its
expenses or make distributions and dividends on the Ordinary
Shares.
Restrictions in Offering Ordinary Shares as a Consideration for
an Acquisition or Requirements to Provide Alternative
Consideration.
In certain jurisdictions, there may be legal, regulatory or
practical restrictions on the Company using its Ordinary Shares as
a consideration for an acquisition or which may mean that the
Company is required to provide alternative forms of consideration.
Such restrictions may limit the Company's acquisition opportunities
or make a certain acquisition more costly, which may have an
adverse effect on the results of operations of the Company.
For the further commentary on the Company's risk management
policies.
Gender analysis
A split of our employees and directors by gender and average
number during the year is shown below:
Male Female
Directors 2 nil
Corporate social responsibility
We aim to conduct our business with honesty, integrity and
openness, respecting human rights and the interests of our
shareholders and employees. We aim to provide timely, regular and
reliable information on the business to all our shareholders and
conduct our operations to the highest standards.
We strive to create a safe and healthy working environment for
the wellbeing of our staff and create a trusting and respectful
environment, where all members of staff are encouraged to feel
responsible for the reputation and performance of the Company.
We aim to establish a diverse and dynamic workforce with team
players who have the experience and knowledge of the business
operations and markets in which we operate. Through maintaining
good communications, members of staff are encouraged to realise the
objectives of the Company and their own potential.
The Board would like to take this opportunity to thank our
shareholders, Board and advisors for their support during the
year.
Section 172 Statement
Section 172 of the Companies Act 2006 requires Directors to take
into consideration the interests of stakeholders and other matters
in their decision making. The Directors continue to have regard to
the interests of the Company's stakeholders, however it should be
noted that because Mila is a small "shell" company; with only two
directors; no employees and the impacts of its activities is
limited. This statement forms part of the strategic report.
When making decisions the Company takes into account the impact
of its activities on the community, the environment and the
Company's reputation for good business conduct. In this context,
acting in good faith and fairly, the Directors consider what is
most likely to promote the success of the Company for its members
in the long term.
The Directors are fully aware of their responsibilities to
promote the success of the Company in accordance with section 172
of the Companies Act 2006. The Board continuously reflects on how
the Company engages with its stakeholders and opportunities for
enhancement in the future. As required, the Company's external
lawyers and the Company Secretary will provide support to the Board
to help ensure that enough consideration is given to issues
relating to the matters set out in s172(1)(a)-(f).
The Board regularly reviews the Company's principal stakeholders
and how it engages with them. This is achieved through information
provided by management via Regulatory News Service announcements,
Corporate Presentations, and Shareholder Meetings and
teleconferences and also by direct engagement with stakeholders
themselves.
We aim to work responsibly with our stakeholders, including
suppliers. The key Board decisions made in the year and post year
end are set out below:
Significant events/decisions Key s172 matter(s) affected Actions and Consequences
Entered into non-binding Shareholders and Business The consequences of this
Head of Terms with regards Relationships decision were to allocate
to the possible acquisition capital to the RTO process
of 100% of the share to fully investigate
capital of E-Tech Metals. the suitability of the
RTO target.
Entered into non-binding Business Relationships This decision provides
Head of Terms with regards and Shareholders a pathway to a reverse
to the possible acquisition takeover with NGM, which
of 100% of the share if successful, should
capital of New Generation meet the Company's strategy.
Mining - post year end
Finally, to you, our shareholders, thank you for your trust and
support. I hope you stay safe and well and I look forward to
meeting you face to face at a Company event when our world returns
to what will be a 'new normal'.
This report was approved by the board on 25 January 2021 and
signed on its behalf.
Mark Stephenson
Chief Executive Officer
Statement of Comprehensive Income
For the Year Ended 30 June 2020
Year ended Year ended
30 June 2020 30 June 2019
Notes GBP GBP
Revenue - -
Administrative expenses (220,220) (259,395)
-------------- --------------
Operating loss (220,220) (259,395)
Interest receivable 7 849 -
-------------- --------------
Loss on ordinary activities before
taxation 4 (219,371) (259,395)
Tax on loss on ordinary activities 8 - -
-------------- --------------
Loss and total comprehensive loss
for the period attributable to the
owners of the company (219,371) (259,395)
============== ==============
Earnings per share (basic and diluted)
attributable to the equity holders
(pence) 9 (0.95) (1.12)
The above results relate entirely to continuing activities.
The accompanying notes form part of these financial
statements.
Statement of Financial Position
As at 30 June 2020
Year ended Year ended
30 June 2020 30 June 2019
Notes GBP GBP
CURRENT ASSETS
Trade and other receivables 10 23,705 17,642
Cash and cash equivalents 12 186,316 428,673
Loans receivable - E-Tech 11 85,849 -
-------------- --------------
295,870 446,315
-------------- --------------
TOTAL ASSETS 295,870 446,315
-------------- --------------
CURRENT LIABILITIES
Trade and other payables 13 86,671 17,745
-------------- --------------
TOTAL LIABILITIES 86,671 17,745
-------------- --------------
NET ASSETS 209,199 428,570
============== ==============
EQUITY
Share capital 15 232,000 232,000
Share premium 15 849,300 849,300
Share based payment reserve 16 4,720 4,720
Retained loss (876,821) (657,450)
TOTAL EQUITY 209,199 428,570
============== ==============
The accompanying notes form part of these financial
statements.
Statement of Cashflows
For the Year Ended 30 June 2020
Year ended Year ended
30 June 2020 30 June 2019
GBP GBP
Cash flow from operating activities
Loss for the year (219,371) (259,395)
Operating cashflow before working
capital movements (219,371) (259,395)
Increase in trade and other receivables (6,063) (8,850)
Increase / (Decrease) in trade and
other payables 68,926 (4,632)
Interest income (849) -
-------------- --------------
Net cash outflow from operating activities (157,357) (272,877)
-------------- --------------
Cash flow from investing activities
Loan to E-Tech (85,000) -
-------------- --------------
Net decrease in cash and cash equivalents (242,357) (272,877)
Cash and cash equivalents at the
beginning of the year 428,673 701,550
Cash and cash equivalents at the
end of the year 186,316 428,673
============== ==============
Statement of Changes in Equity
For the Year Ended 30 June 2020
Share Share Share Based Retained Total
Capital Premium Payment Loss
Reserve
GBP GBP GBP GBP GBP
Balance at 1 July
2018 232,000 849,300 4,720 (398,055) 687,964
---------- --------- ------------ ---------- ----------
Total comprehensive
loss for the year - - - (259,395) (259,395)
Balance at 30 June
2019 232,000 849,300 4,720 (657,450) 428,570
---------- --------- ------------ ---------- ----------
Total comprehensive
loss for the year - - - (219,371) (219,371)
Balance at 30 June
2020 232,000 849,300 4,720 (876,821) 209,199
---------- --------- ------------ ---------- ----------
The accompanying notes form part of these financial
statements.
Notes to the Financial Statements
For the Year Ended 30 June 2020
1 GENERAL INFORMATION
Mila Resources Plc (the "Company") looks to identify potential
companies, businesses or asset(s) that will increase shareholder
value.
The Company is domiciled in the United Kingdom and incorporated
and registered in England and Wales as a public limited company.
The Company's registered office is Lockstrood Farm, Ditchling
Common, Burgess Hill, West Sussex, RH15 0SJ. The Company's
registered number is 09620350.
2 ACCOUNTING POLICIES
2.1 Basis of preparation
The Financial Statements of the Company have been prepared in
accordance with International Financial Reporting Standards
("IFRS") and IFRS Interpretations Committee ("IFRS IC") as adopted
by the European Union and the Companies Act 2006 applicable to
companies reporting under IFRS.
The Financial Statements have been prepared un the historical
cost convention. The principal accounting policies are set out
below and have, unless otherwise stated, been applied consistently
for all periods presented in these Financial Statements. The
Financial Statements are prepared in pounds Sterling and presented
to the nearest pound.
2.2 Going concern
The Financial Statements have been prepared under the going
concern assumption, which presumes that the Company will be able to
meet its obligations as they fall due for at least the next twelve
months from the date of the signing of the Financial
Statements.
The Company had a net cash outflow from operating activities for
the year of GBP242,357 (2019: GBP272,877) and at 30 June 2020 had
cash and cash equivalents balance of GBP186,316 (2019:
GBP428,673).
Notwithstanding the loss incurred and net cash outflow during
the year under review, the Directors are confident that the Company
will be able to meet its obligations as they fall due for at least
the next twelve months as they believe the Company will be able to
raise further finance regardless of the completion of the proposed
transaction or any other such transactions during this period.
The Directors do acknowledge that the dependence on obtaining
finance leads to there being a material uncertainty regarding the
Company's going concern status, however, they still believe the
application of the going concern basis of preparation to be
appropriate due to their confidence that further finance will be
able to be obtained as required during the going concern
period.
The Directors have made enquires and assessed the potential
impact of the COVID-19 virus on the
Company. As such, whilst they acknowledge that COVID-19 could
continue to have long lasting and significant impacts on the global
economy, the Directors believe that the Company will be able to
raise sufficient finance to meet their obligations as they fall due
for a period of at least 12 months from the date of approval of the
financial statements.
The Financial Statements do not include any adjustments that may
be required should the Company be unable to continue as a going
concern.
The auditors have made reference to going concern by way of a
material uncertainty within their audit report.
2.3 Standards, amendments and interpretations to existing
standards that are not yet effective and have not been early
adopted by the Group
New standards, amendments to standards and interpretations:
During the financial year, the Company has adopted the following
new IFRSs (including amendments thereto) and IFRIC interpretations
that became effective for the first time.
Effective
Standard Impact on initial application date
IFRS 16 Leases 1 January
2019
IFRIC Interpretation Uncertainty over Income Tax 1 January
23 Treatments 2019
IFRS 9 (Amendments) Prepayment Features with Negative 1 January
Compensation 2019
IAS 28 (Amendments) Long-term Interests in Associates 1 January
and Joint Ventures 2019
Annual improvements 2015-2017 Cycle 1 January
2019
IAS 19 (Amendments) Plan Amendment, Curtailment 1 January
or Settlement. 2019
No new standards, amendments or interpretations, effective for
the first time for the financial year beginning on or after 1 July
2019 have had a material impact on the Company.
Standards issued but not yet effective:
At the date of authorisation of these financial statements, the
following standards and interpretations relevant to the Company and
which have not been applied in these financial statements, were in
issue but were not yet effective. In some cases, these standards
and guidance have not been endorsed for use in the European
Union.
Standard Impact on initial application Effective date
IFRS 3 (amendments) Definition of a Business 1 January 2020
IFRS standards 1 January 2020
(amendments)
References to the Conceptual Framework
IAS 1 (amendments) Definition of Material 1 January 2020
IAS 8 (amendments) Definition of Material 1 January 2020
IFRS 9, IAS 39 Interest Rate Benchmark Reform 1 January 2020
and IFRS 7 (amendments)
IFRS 17 Insurance Contracts 1 January 2021
The directors do not consider that these standards will impact
the financial statements of the Company.
2.4 Foreign currency translation
The financial information is presented in Sterling which is the
Company's functional and presentational currency.
Transactions in currencies other than the functional currency
are recognised at the rates of exchange on the dates of the
transactions. At each balance sheet date, monetary assets and
liabilities are retranslated at the rates prevailing at the balance
sheet date with differences recognised in the Statement of
comprehensive income in the period in which they arise.
2.5 Financial instruments
Initial recognition
A financial asset or financial liability is recognised in the
statement of financial position of the Company when it arises or
when the Company becomes part of the contractual terms of the
financial instrument.
Classification
Financial assets at amortised cost
The Company measures financial assets at amortised cost if both
of the following conditions are met:
(1) the asset is held within a business model whose objective is
to collect contractual cash flows; and
(2) the contractual terms of the financial asset generating cash
flows at specified dates only pertain to capital and interest
payments on the balance of the initial capital.
Financial assets which are measured at amortised cost, are
measured using the Effective Interest Rate Method (EIR) and are
subject to impairment. Gains and losses are recognised in profit or
loss when the asset is derecognised, modified or impaired.
Financial liabilities at amortised cost
Financial liabilities measured at amortised cost using the
effective interest rate method include current borrowings and trade
and other payables that are short term in nature. Financial
liabilities are derecognised if the Company's obligations specified
in the contract expire or are discharged or cancelled.
Amortised cost is calculated by taking into account any discount
or premium on acquisition and fees or costs that are an integral
part of the effective interest rate ("EIR"). The EIR amortisation
is included as finance costs in profit or loss. Trade payables
other payables are non-interest bearing and are stated at amortised
cost using the effective interest method.
Derecognition
A financial asset is derecognised when:
(1) the rights to receive cash flows from the asset have expired, or
(2) the Company has transferred its rights to receive cash flows
from the asset or has undertaken the
commitment to fully pay the cash flows received without
significant delay to a third party under an
arrangement and has either (a) transferred substantially all the
risks and the assets of the asset or (b
has neither transferred nor held substantially all the risks and
estimates of the asset but has
transferred the control of the asset.
Impairment
The Company recognises a provision for impairment for expected
credit losses regarding all financial assets. Expected credit
losses are based on the balance between all the payable contractual
cash flows and all discounted cash flows that the Company expects
to receive. Regarding trade receivables, the Company applies the
IFRS 9 simplified approach in order to calculate expected credit
losses. Therefore, at every reporting date, provision for losses
regarding a financial instrument is measured at an amount equal to
the expected credit losses over its lifetime without monitoring
changes in credit risk. To measure expected credit losses, trade
receivables and contract assets have been grouped based on shared
risk characteristics.
Trade and other receivables
Trade and other receivables are initially recognised at fair
value when related amounts are invoiced then carried at this amount
less any allowances for doubtful debts or provision made for
impairment of these receivables.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and
are subject to an insignificant risk of changes in value.
Trade payables
These financial liabilities are all non-interest bearing and are
initially recognised at the fair value of the consideration
payable.
2.6 Equity
Share capital is determined using the nominal value of shares
that have been issued.
The Share premium account includes any premiums received on the
initial issuing of the share capital. Any transaction costs
associated with the issuing of shares are deducted from the Share
premium account, net of any related income tax benefits.
Equity-settled share-based payments are credited to a
share-based payment reserve as a component of equity until related
options or warrants are exercised or lapse.
Retained losses includes all current and prior period results as
disclosed in the income statement.
2.7 Share-based payments
The Company has issued warrants to the initial investors and
certain counter parties and advisers.
Equity-settled share-based payments are measured at fair value
(excluding the effect of non-market based vesting conditions) at
date of grant. The fair value so determined is expensed on a
straight-line basis over the vesting period, based on the Company's
estimate of the number of shares that will eventually vest and
adjusted for the effect of non-market based vesting conditions.
Fair value is measured using the Black Scholes pricing model. The
key assumption used in the model have been adjusted, based on
management's best estimate, for the effects of non-transferability,
exercise restrictions and behavioural considerations.
2.8 Taxation
Tax currently payable is based on taxable profit for the period.
Taxable profit differs from profit as reported in the income
statement because it excludes items of income and expense that are
taxable or deductible in other years and it further excludes items
that are never taxable or deductible. The Company's liability for
current tax is calculated using tax rates that have been enacted or
substantively enacted by the balance sheet date.
Deferred tax is recognised on differences between the carrying
amounts of assets and liabilities in the financial statements and
the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits
will be available against which deductible temporary differences
can be utilised. Such assets and liabilities are not recognised if
the temporary difference arises from initial recognition of
goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries and associates,
and interests in joint ventures, except where the Company is able
to control the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in the
foreseeable future.
The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled, or the asset
realised. Deferred tax is charged or credited to profit or loss,
except when it relates to items charged or credited directly to
equity, in which case the deferred tax is also dealt with in
equity.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
2.9 Critical accounting judgements and key sources of estimation uncertainty
In the process of applying the entity's accounting policies,
management makes estimates and assumptions that have an effect on
the amounts recognised in the financial information. Although these
estimates are based on management's best knowledge of current
events and actions, actual results may ultimately differ from those
estimates. The Directors consider that there are no critical
accounting judgements or key sources of estimation uncertainly
relating to the financial information of the Company.
2.10 Earnings per share
Basic earnings per share is calculated as profit or loss
attributable to equity holders of the parent for the period,
adjusted to exclude any costs of servicing equity (other than
dividends), divided by the weighted average number of ordinary
shares, adjusted for any bonus element.
2.11 Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating
decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board as a whole.
All operations and information are reviewed together so that at
present there is only one reportable operating segment.
3. SEGMENT REPORTING
As identifying and assessing investment projects is the only
activity the Company is involved in and is therefore considered as
the only operating/reporting segment. Therefore the financial
information of the single segment is the same a set out in the
statement of comprehensive income and statement of financial
position.
4. OPERATING LOSS
This is stated after charging:
2020 2019
GBP GBP
Auditor's remuneration
audit of the Company 16,000 15,000
corporate finance services - 4,000
Directors' remuneration 48,000 112,215
Stock exchange and regulatory
expenses 36,142 29,407
Other expenses 120,078 98,773
-------- --------
Operating expenses 220,220 259,395
-------- --------
5. AUDITOR'S REUMERATION
2020 2019
GBP GBP
Fees payable to the Company's
current auditor:
* audit of the Company's financial statements
* taxation compliance services
16,000 15,000
- -
* corporate finance services - 4,000
16,000 19,000
--------- ---------
6. DIRECTORS AND STAFF COSTS
During the year the only staff of the Company were the Directors
and as such key management personnel. Management remuneration,
other benefits supplied and social security costs to the Directors
during the year was as follows:
2020 2019
GBP GBP
Salaries 48,000 64,215
Severance Payments - 48,000
Social security costs - 9,775
------- --------
48,000 121,990
------- --------
7. INTEREST RECEIVABLE
2020 2019
GBP GBP
Interest due on Loan to E-Tech 849 -
----- -----
8. TAXATION
2020 2019
GBP GBP
The charge / credit for the year
is made up as follows:
Current tax - -
Deferred tax - -
Taxation charge / credit for the - -
year
---------- ----------
A reconciliation of the tax charge
/ credit appearing in the income
statement to the tax that would
result from applying the standard
rate of tax to the results for
the year is:
Loss per accounts (219,371) (259,395)
---------- ----------
Tax credit at the standard rate
of corporation tax in the UK of
19% (2019: 19%) (41,680) (49,285)
Impact of costs disallowed for
tax purposes 74 95
Deferred tax in respect of temporary - -
differences
Impact of unrelieved tax losses
carried forward 41,606 49,190
- -
---------- ----------
Estimated tax losses of GBP817,118 (2019: GBP597,747) are
available for relief against future profits and a deferred tax
asset of GBP155,252 (2019: GBP109,381) has not been provided for in
the accounts due to the uncertainty of future profits.
Factors affecting the future tax charge
The standard rate of corporation tax in the UK is 19%.
Accordingly, the Company's effective tax rate for the period was
19% (2019: 19%).
9. EARNINGS PER SHARE
The calculation of the earnings per share is based on the loss
for the financial period after taxation of GBP219,371 (2019: loss
GBP259,395) and on the weighted average of 23,200,000 (2019:
23,200,000) ordinary shares in issue during the period.
The warrants outstanding at 30 June 2020 and 30 June 2019 are
considered to be non-dilutive in that their conversion into
ordinary shares would not increase the net loss per share.
Consequently, there is no diluted earnings per share to report for
the period.
10. TRADE AND OTHER RECEIVABLES
2020 2019
GBP GBP
Prepayments and other receivables 23,705 17,642
23,705 17,642
------- -------
The Directors consider that the carrying value amount of trade
and other receivables approximates to their fair value.
11. OTHER CURRENT ASSETS
2020 2019
GBP GBP
Loan to E-Tech Metals Limited 85,849 -
85,849 -
------- -----
The Loan to E-Tech Metals ('E-Tech') Limited was a secured loan
that was provided to allow E-Tech to fund its working capital
requirements through the RTO process. When E-Tech terminated the
discussions, the loan was called in and was subsequently repaid in
full in November 2020, see note 22 - Events subsequent to year
end.
The Directors consider that the carrying value amount of trade
and other receivables approximates to their fair value.
12. CASH AND CASH EQUIVALENTS
2020 2019
GBP GBP
Cash at bank 186,316 428,673
186,316 428,673
-------- --------
Cash at bank comprises balances held by the Company in current
bank accounts. The carrying value of these approximates to their
fair value.
13. TRADE AND OTHER PAYABLES
2020 2019
GBP GBP
Trade payables 16,087 1,524
Accruals and other payables 70,584 16,221
86,671 17,745
------- -------
Trade payables and accruals principally comprise amounts
outstanding in respect of costs incurred in the Company's
endeavours to find a suitable target and execute a relating
transaction.
14. DEFERRED TAXATION
No deferred tax asset has been recognised by the Company due to
the uncertainty of generating sufficient future profits and tax
liability against which to offset the tax losses. Note 8 above sets
out the estimated tax losses carried forward and the impact of the
deferred tax asset not accounted for.
15. SHARE CAPITAL / SHARE PREMIUM
Number Share Share
of shares capital premium Total
on issue GBP GBP GBP
Balance as at 1 July 2018 23,200,000 232,000 849,300 1,081,300
Balance as at 30 June 2019 23,200,000 232,000 849,300 1,081,300
----------- --------- --------- ----------
Balance as at 30 June 2020 23,200,000 232,000 849,300 1,081,300
----------- --------- --------- ----------
The Company has only one class of share. All ordinary shares
have equal voting rights and rank pari passu for the distribution
of dividends and repayment of capital.
At 30 June 2020, there were warrants and options over 15,825,000
unissued ordinary shares (2019: 15,825,000).Details of the warrants
outstanding are as follows:
Issued Exercisable Expiry date Number outstanding Exercise
from price
16 October 2015 From date 31 December 4,400,000 GBP0.05
of issue 2020
12 September From date 31 December 350,000 GBP0.05
2016 of issue 2020
26 September 7 October 31 December 11,075,000 GBP0.10
2016 * 2016 2020
15,825,000
-------------------
* The warrants were issued conditional upon the Ordinary Shares
to be admitted to trading on the London Stock Exchange's main
market for listed securities which occurred on 7 October 2016.
The Directors held the following warrants at the beginning and
end of the year:
Director At 30 June Granted At 30 June Exercise Earliest Latest date
2019 during 2020 price date of of exercise
the year exercise
16 Oct
M Stephenson 1,200,000 - 1,200,000 GBP0.05 2016 20 Dec 2020
1,200,000 - 1,200,000
----------- ---------- -----------
Warrants held by former Directors have been set out on page
16.
The market price of the shares at year end was GBP0.016 per
share.
During the year, the minimum and maximum prices were GBP0.0125
and GBP0.0245 per share respectively.
16. SHARE BASED PAYMENT RESERVE
2020 2019
GBP GBP
At 1 July 4,720 4,720
Share based payments expense recognised - -
during the period
At 30 June 4,720 4,720
------ ------
The Company did not issue any warrants during the current or
prior year.
Fair Value Weighted average
Number GBP exercise price
At 1 July 2018 15,825,000 4,720 GBP0.085
Balance at 30 June 2019 15,825,000 4,720 GBP0.085
----------- ----------------------- -----------------
Balance at 30 June 2020 15,825,000 4,720 GBP0.085
----------- ----------------------- -----------------
The warrants outstanding at the year-end have a weighted average
remaining contractual life of 0.5 years. The exercise prices of the
warrants are GBP0.05 and GBP0.10 per share.
17. CAPITAL COMMITMENTS
There were no capital commitments at 30 June 2019 and 30 June
2020
18. CONTINGENT LIABILITIES
There were no contingent liabilities at 30 June 2019 and 30 June
2020
19. COMMITMENTS UNDER OPERATING LEASES
There were no commitments under operating leases at 30 June 2019
and 30 June 2020
20. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The Company's financial instruments comprise primarily cash and
various items such as trade debtors and trade payables which arise
directly from operations. The main purpose of these financial
instruments is to provide working capital for the Company's
operations. The Company does not utilise complex financial
instruments or hedging mechanisms.
Financial assets by category
2020 2019
GBP GBP
Current Assets:
Trade and other receivables (excluding
prepayments) - 1,642
Cash and cash equivalents 186,316 428,673
Loan to E-Tech Metals Limited 85,849 -
Categorised as financial assets at
amortised cost 272,165 430,315
-------- --------
The Loan to E-Tech Metals ('E-Tech') Limited was a secured loan
that was provided to allow E-Tech to fund its working capital
requirements through the RTO process. When E-Tech terminated the
discussions, the loan was called in and repaid in full in November
2020, see note 22 - Events subsequent to year end.
Financial liabilities by category
2020 2019
GBP GBP
Current Liabilities:
Trade and other payables 16,113 17,745
Categorised as financial liabilities
measured at amortised cost 16,113 17,745
------- -------
All amounts are short term and payable in 0 to 3 months.
Credit risk
The maximum exposure to credit risk at the reporting date by
class of financial asset was:
2020 2019
GBP GBP
Trade and other receivables - 1,642
Loan to E-Tech Metals Limited 85,849 -
------- ------
85,849 1,642
------- ------
Capital management
The Company considers its capital to be equal to the sum of its
total equity. The Company monitors its capital using a number of
key performance indicators including cash flow projections, working
capital ratios, the cost to achieve development milestones and
potential revenue from partnerships and ongoing licensing
activities.
The Company's objective when managing its capital is to ensure
it obtains sufficient funding for continuing as a going concern.
The Company funds its capital requirements through the issue of new
shares to investors.
Interest rate risk
The maximum exposure to interest rate risk at the reporting date
by class of financial asset was:
2020 2019
GBP GBP
Bank balances 186,316 428,673
-------- --------
The nature of the Company's activities and the basis of the
funding are such that until a suitable target is acquired, the
Company raises finance as and when required to meet its obligations
as they fall due.
The Company is not financially dependent on the income earned on
these resources and therefore the risk of interest rate
fluctuations is not significant to the business and the Directors
have not performed a detailed sensitivity analysis.
All deposits are placed with main clearing banks, with 'A'
ratings, to restrict both credit risk and liquidity risk. The
deposits are placed for the short term, between one and three
months, to provide flexibility and access to the funds.
Credit and liquidity risk
Credit risk is managed on a Company basis. Funds are deposited
with financial institutions with a credit rating equivalent to, or
above, the main UK clearing banks. The Company's liquid resources
are invested having regard to the timing of payment to be made in
the ordinary course of the Company's activities. All financial
liabilities are payable in the short term (between 0 to 3 months)
and the Company maintains adequate bank balances to meet those
liabilities.
20. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
Currency risk
The Company operates in a global market with income and costs
possibly arising in a number of currencies. The majority of the
operating costs are incurred in GBPGBP. The Company does not hedge
due to the Company incurring very few foreign currency denominated
costs and thus the cost and time taken to hedge would be far
greater than the benefit. The Company did not have foreign currency
exposure at year end.
21. RELATED PARTY TRANSACTIONS
Key management personnel compensation
The Directors are considered to be key management personnel.
Detailed remuneration disclosures are provided in the remuneration
report on pages 14 - 16.
Amounts due from/to related parties
There were amounts due to directors totalling GBP11,954 as at 30
June 2020 (2019: GBP3,185). No amounts were due from directors as
at 30 June 2020 (2019: GBP1,642)
There were no other related party transactions.
22. EVENTS SUBESQUENT TO YEAR END
Collapse of Negotiations with E-Tech Metals Limited ('E-Tech')
Limited and recovery of outstanding loan.
The transaction with E-Tech Metals Limited was materially
advanced following due diligence and the preparation of a
prospectus; however, E-Tech gave notice that they wished to
terminate the transaction without cause. Mila is receiving legal
advice with regard to the termination notice provided by
E-Tech.
Mila has recovered the loan of GBP87,402 (which includes all
accrued interest) advanced to E-Tech.
Suspension and Heads of Terms with New Generation Minerals
Limited ("NGM')
Mila entered into non-binding Heads of Terms with regard to the
possible acquisition of 100% of the share capital of New Generation
Minerals Limited ("NGM') to be satisfied by the issue of New
Ordinary Shares of the Company.
NGM is a UK private company, whose principal asset is the
Kathleen Valley gold project ("Project") in Western Australia. The
Project is located in the prolific Wiluna-Norseman gold belt which
hosts several world-class mines owned by a number of premier
Australian gold companies including Northern Star and St Barbara.
NGM holds other nickel and cobalt assets in Western Australia
including a JORC inferred resource of 3.8 Mt Nickel-Cobalt project
and one copper-gold project in Argentina.
Extension of Warrants
Mila announced that it has amended the terms of certain warrants
granted at the time of its IPO on 7 October 2016 by extending the
life of certain warrants. The series 1 warrants granted to the
founders will expire on 31 December 2020 as scheduled.
Warrant Amendments
Warrant Current terms Revised terms
Series 1 (Founders) Exercise price of 5p No revision - will
and due to expire on lapse on 31 December
31 December 2020 2020
---------------------- ----------------------
Series 2 Exercise price of 5p Expiration extended
and due to expire on 31 December 2022
31 December 2020
---------------------- ----------------------
IPO Investors Exercise price of 10p Expiration extended
and due to expire on to 31 December 2022
31 December 2020
---------------------- ----------------------
23. CONTROL
In the opinion of the Directors there is no single ultimate
controlling party.
**ENDS**
For more information visit www.milaresources.com or contact:
Mark Stephenson Mila Resources Plc +44 (0) 20 7236 1177
Jonathan Evans Brandon Hill Capital +44 (0)20 3463 5016
---------------------- ---------------------
Susie Geliher / Beth St Brides Partners
Melluish Ltd +44 (0) 20 7236 1177
---------------------- ---------------------
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