Mila
Resources Plc / Index: LSE / Epic: MILA / Sector: Natural
Resources
28 March 2024
Mila Resources
Plc
("Mila" or "the
Company")
Interim
Results
Mila Resources Plc, the
post-discovery gold exploration accelerator, is pleased to present
its interim results for the six-month period ended 31 December
2023.
Highlights:
·
Advanced post-discovery exploration accelerator
business model through targeted exploration work and value
accretive partnerships.
·
Exploration progress made at initial asset, the
Kathleen Valley Gold Project in Western Australia, a premier mining
destination.
·
Mutually beneficial partnership agreed with
Australia's leading lithium company, Liontown Resources, to explore
for lithium extensions at Kathleen Valley Gold Project.
·
Project generator team expanded through
appointment of Alastair Goodship - a highly experienced exploration
geologist with a proven track record of exploration
success.
·
Successfully raised gross proceeds of £2m to
support work at Kathleen Valley Gold Project and advance additional
valuable development opportunities.
·
Cash position of £1,684,073 as at 31 December
2023.
·
Loss for the six-month period ended 31 December of
£321,436 (2022: £205,404).
Chairman Statement
The period under review has been
seen Mila's strategy advance and mature, most excitingly through
Mila's partnership with Australia's leading lithium company,
Liontown Resources ("Liontown"). As shareholders will be
aware, our first asset within our post-discovery exploration
accelerator model, the Kathleen Valley Gold Project, has yielded
highly encouraging gold results since our work programme began in
2021, however it was lithium, not gold, that attracted Liontown to
us in 2023, as they are confident about the lithium mineralisation
on their licence which extends south into Kathleen Valley.
This resulted in a mutually beneficial partnership between Mila and
Liontown, through which exploration for both gold and lithium will
be carried out on our tenement throughout 2024. This
partnership also serves to underscore the value of our accelerator
model as we look to broaden our horizons to potential new
projects.
Kathleen Valley
Mila has now completed several
drilling phases at Kathleen Valley, designed to test the known
mineralisation and test the "unknown" by drilling at depth and
stepping out from the previously tested mineralisation. With each
drilling phase, the Company is generating a clearer picture of this
highly structured geological system, featuring concentrated zones
of high-grade gold mineralisation, potentially mirroring Bellevue's
system to the west of us.
Our focus over the coming months
will be to capitalise on the operational and technical efficiencies
of working with Liontown. Post period end, Liontown
commissioned an aerial image survey for its baseline studies and to
comply with heritage and environmental regulations, ahead of
commencing sampling and drilling works on the project. Liontown has
now completed the aerial image survey and a soil sampling programme
is underway. The assay results will then be used by Liontown to
determine drilling targets for lithium, and also by Mila for
precious and base metals to provide a more complete picture of the
geological model for Kathleen Valley and determine any new targets
outside of the recent focus on the Coffey deposit.
As previously reported, Mila
benefits from a number of development routes given Kathleen Valley
is surrounded by gold mining infrastructure and some of Australia's
leading gold companies. We are committed to moving Kathleen
Valley forward, leveraging the geological information and
technical/Heritage Survey expertise of Liontown.
Project Generator Opportunities
Our over-arching strategy remains to
become a "best in class" post-discovery exploration accelerator
through the careful identification and development of proven
projects, which we believe is imperative now given the continued
pressure on the IPO market and traditional routes of finance.
To this end, we have looked to build our technical team during the
period and were delighted to announce the appointment of Alastair
Goodship to the Mila team in Q4 2023. Alastair is an
exploration geologist with significant experience in leading
discovery-focussed exploration teams in a diverse range of
environments and jurisdictions globally, and he has proved an
impressive and valuable member of our group.
Alastair has been working on various
potential new opportunities, assessing their relative merits in
order to generate a shortlist of potential assets through which to
broaden our portfolio. The biggest single risk facing most
junior mining companies is that they are reliant on the success of
a sole project, something that the Board of Mila are keen to
avoid. With this in mind, the team are making solid progress
on a number of potential opportunities, however there can be no
guarantee that these will come to fruition. The Board are
hopeful that through the continued focus on quality and whilst
retaining the internal expertise to rapidly add value to a project,
we will be able to make further updates on the advancement of
Mila's project generator strategy during the current
period.
Finance and Corporate
Results
The interim results for the six
months to 31 December 2023 show a loss of £321,436 (2022:
£205,404).
Fund Raise
In October 2023, the Company
published a prospectus and announced the placing of 200,000,000 new
ordinary shares at a price of 1 pence per ordinary share to raise
£2m. The placing shares have one warrant attached with an exercise
price of 2 pence for a period of two years from the date of
admission, which was 9 November 2023. The Placing was approved by
Shareholders at a General Meeting on 8 November 2023.
Cash Position
At 31 December 2023, cash and cash
equivalents amounted to £1,684,073 (2022: £832,275).
Directors
The following Directors have held
office during the period:
Mark Stephenson
Lee Daniels
Neil Hutchison
Lindsay Mair
Corporate Governance
The UK Corporate Governance Code
(September 2014) ("the Code"), as appended to the Listing Rules,
sets out the Principles of Good Corporate Governance and Code
Provisions which are applicable to listed companies incorporated in
the United Kingdom. As a standard listed company, the Company
is not subject to the Code, but the Board recognises the value of
applying the principles of the Code where appropriate and
proportionate and has endeavoured to do so where
practicable.
On
behalf of the board
Mark Stephenson
Director
27 March 2024
MILA RESOURCES PLC
Interim Statement of Comprehensive Income
(Unaudited)
For
the six months ended 31 December 2023
|
Notes
|
|
Six months
ended
31 December 2023
Unaudited
|
|
Six months
ended
31 December 2022
Unaudited
|
|
Year
ended
30 June
2023 Audited
|
|
|
|
£
|
|
£
|
|
£
|
|
|
|
|
|
|
|
|
Administrative expenses
|
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
Operating
loss
|
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
|
|
|
|
|
|
|
|
Loss on ordinary activities
before taxation
|
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
Income tax
expense
|
4
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
Loss for the
period
|
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
|
|
|
|
|
|
|
|
Other
comprehensive income / (loss)
|
|
|
-
|
|
-
|
|
-
|
Total comprehensive income
for the period attributable to equity holders
|
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
|
|
|
|
|
|
|
|
Earnings
per share (basic and diluted) attributable to equity holders
(p)
|
5
|
|
(0.09)
|
|
(0.07)
|
|
(0.17)
|
The income statement has been
prepared on the basis that all operations are continuing
operations.
MILA RESOURCES PLC
Interim Statement of Financial Position
(Unaudited)
As
at 31 December 2023
|
|
|
At 31
December 2023
Unaudited
|
|
At 31
December
2022
Unaudited
|
|
At 30
June 2023
Audited
|
|
Notes
|
|
£
|
|
£
|
|
£
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
Exploration
and evaluation assets
|
6
|
|
5,682,925
|
|
5,535,102
|
|
5,605,870
|
|
|
|
5,682,925
|
|
5,535,102
|
|
5,605,870
|
Current
assets
|
|
|
|
|
|
|
|
Trade and
other receivables
|
|
|
129,176
|
|
33,925
|
|
135,459
|
Cash at
bank and in hand
|
|
|
1,684,073
|
|
832,275
|
|
448,063
|
|
|
|
1,813,249
|
|
866,200
|
|
583,522
|
|
|
|
|
|
|
|
|
Total
assets
|
|
|
7,496,174
|
|
6,401,302
|
|
6,189,392
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
Trade and
other payables
|
|
|
179,526
|
|
180,766
|
|
312,938
|
Convertible
loan notes
|
|
|
51,475
|
|
-
|
|
-
|
|
|
|
231,001
|
|
180,766
|
|
312,938
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
231,001
|
|
180,766
|
|
312,938
|
Net assets
|
|
|
7,265,173
|
|
6,220,536
|
|
(5,876,454)
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
Share
capital
|
7
|
|
5,368,178
|
|
3,368,178
|
|
3,368,178
|
Share
premium
|
7
|
|
4,494,758
|
|
4,784,603
|
|
4,784,603
|
Share based
payment reserve
|
|
|
539,093
|
|
543,813
|
|
539,093
|
Retained
losses
|
|
|
(3,136,856)
|
|
(2,476,057)
|
|
(2,815,420)
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
7,265,173
|
|
6,220,536
|
|
(5,876,454)
|
|
|
|
|
|
|
|
|
MILA RESOURCES
PLC
Statements of changes in
equity (Unaudited)
For the six months ended 31
December 2023
|
|
|
|
|
|
|
|
|
Share
Capital
|
Share Premium
Account
|
Share Based Payment
Reserve
|
Retained
Loss
|
TOTAL
|
|
|
|
£
|
£
|
£
|
£
|
£
|
|
|
|
|
|
|
|
|
|
Balance at 30 June
2022
|
3,065,511
|
4,267,846
|
543,813
|
(2,270,653)
|
(5,606,517)
|
|
Total
comprehensive income for the year
|
-
|
-
|
-
|
(549,487)
|
(549,487)
|
|
Capital
Raising - Issue of shares
|
302,667
|
605,333
|
-
|
-
|
908,000
|
|
Capital
Raising - Issue Costs
|
-
|
(88,576)
|
-
|
-
|
(88,576)
|
|
Expired
Warrants
|
-
|
-
|
(4,720)
|
4,720
|
-
|
|
Balance at 30 June
2023
|
3,368,178
|
4,784,603
|
539,093
|
(2,815,420)
|
5,876,454
|
|
Total
comprehensive income for the period
|
-
|
-
|
-
|
(321,436)
|
(321,436)
|
|
Capital
Raising - Issue of shares
|
2,000,000
|
-
|
-
|
-
|
2,000,000
|
|
Capital
Raising - Issue Costs
|
-
|
(289,845)
|
-
|
-
|
(289,845)
|
|
Balance at 31 Dec
2023
|
5,368,178
|
4,494,758
|
539,093
|
(3,136,856)
|
7,265,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MILA RESOURCES PLC
Statement of cash flow (Unaudited)
For
the six months ended 31 December 2023
|
|
Six months
to 31
December
|
|
Six months
to 31
December
|
|
12 months
to 30
June
|
|
|
2023
|
|
2022
|
|
2023
|
|
|
£
|
|
£
|
|
£
|
Cash flows from operating
activities
|
|
|
|
|
|
|
Loss for
the period
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
Operating
cashflow before working capital movements
|
|
(321,436)
|
|
(205,404)
|
|
(549,487)
|
Decrease / (Increase) in trade and other
receivables
|
|
6,283
|
|
(11,357)
|
|
(112,891)
|
Decrease in trade and other
payables
|
|
(133,412)
|
|
(29,994)
|
|
102,178
|
Net cash flow from operating
activities
|
|
(448,565)
|
|
(246,755)
|
|
(560,200)
|
|
|
|
|
|
|
|
Cash flow from investing
activities
|
|
|
|
|
|
|
Funds used
for drilling and exploration
|
|
(77,055)
|
|
(836,477)
|
|
(907,245)
|
Net
cash outflow from investing activities
|
|
(77,055)
|
|
(836,477)
|
|
(907,245)
|
|
|
|
|
|
|
|
Cash flow from financing
activities
|
|
|
|
|
|
|
Proceeds
from share issues
|
|
2,000,000
|
|
863,839
|
|
908,000
|
Issue costs
paid in cash
|
|
(289,845)
|
|
(44,416)
|
|
(88,576)
|
Convertible
Loan Note
|
|
51,475
|
|
-
|
|
-
|
Net cash inflow from
financing activities
|
|
1,761,630
|
|
819,423
|
|
819,424
|
|
|
|
|
|
|
|
Net Increase / ( Decrease) in
cash and cash equivalents
|
|
1,236,010
|
|
(263,809)
|
|
(648,021)
|
|
|
|
|
|
|
|
Cash and cash equivalents at
beginning of the period
|
|
448,063
|
|
1,096,084
|
|
1,096,084
|
|
|
|
|
|
|
|
Cash and cash equivalents at
end of the period
|
|
1,684,073
|
|
832,275
|
|
448,063
|
MILA RESOURCES PLC
Notes to the financial statements
For
the six months ended 31 December 2023
1
General
information
Mila Resources Plc (the
"Company'') was listed on the London Stock
Exchange in 2016 with a view to acquiring projects in the natural
resources sector that had a significant innate value that could be
unlocked without excessive capital. In November 2021, the Company
acquired an interest in a gold exploration project in Western
Australia.
The Company is domiciled in the
United Kingdom and incorporated and registered in England and
Wales, with registration number 09620350.
The Company's registered office is
6th Floor, 65 Gresham Street, London, EC2V
7NQ.
2
Accounting
policies
The principal accounting policies
applied in preparation of these consolidated financial statements
are set out below. These policies have been consistently applied
unless otherwise stated.
Basis of preparation
The interim unaudited financial
statements for the period ended 31 December 2023 have been prepared
in accordance with IAS 34 Interim Financial Reporting. This interim
financial information is not the Company's statutory financial
statements and should be read in conjunction with the annual
financial statements for the period ended 30 June 2023, which have
been prepared in accordance with International Financial Reporting
Standards (IFRS) and have been delivered to the Registrar of
Companies. The auditors have reported on those accounts;
their report was unqualified and did not contain statements under
section 498 (2) or (3) of the Companies Act 2006.
The interim financial information
for the six months ended 31 December 2023 is unaudited. In the
opinion of the Directors, the interim consolidated financial
information presents fairly the financial position, and results
from operations and cash flows for the period.
The Directors have made an
assessment of the Company's ability to continue as a going concern
and the interim report has been prepared on the going concern
basis, which contemplates the continuity of normal business
activity and the realisation of assets and the settlement of
liabilities in the normal course of business. The Company,
therefore, continues to adopt the going concern basis in preparing
its consolidated financial statements.
The financial information of the
Company is presented in British Pounds Sterling (£).
Critical accounting estimates and judgements
The preparation of interim financial
information requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and
the reported amounts of assets and liabilities 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, the resulting accounting estimates
will, by definition, seldom equal related actual
results.
In preparing the interim financial
information, the significant judgements made by management in
applying the Company's accounting policies and the key sources of
estimation uncertainty.
MILA RESOURCES PLC
Notes to the financial statements
For
the six months ended 31 December 2023
Intangible assets - Exploration and evaluation expenditures
(E&E) Development expenditure
Expenditure on the construction,
installation and completion of infrastructure facilities including
service, is capitalized initially within intangible fixed assets
and when the asset has formally commenced commercial production,
then it is transferred to property, plant and equipment and is
depreciated from the commencement of production as described in the
accounting policy for property, plant and
equipment.
Drilling costs and intangible licenses
The Company applies the successful
efforts method of accounting, having regard to the requirements of
IFRS 6 'Exploration for and Evaluation of Mineral Resources'. Costs
incurred prior to obtaining the legal rights to explore an area are
expensed immediately to the Statement of Comprehensive
Income.
Expenditure incurred on the
acquisition of a licence interest is initially capitalised within
intangible assets on a licence by licence basis. Costs are held,
unamortised, until such time as the exploration phase of the field
area is complete or commercial reserves have been discovered. The
cost of the licence is subsequently transferred into property,
plant and equipment and depreciated over its estimated useful
economic life.
Exploration expenditure incurred in
the process of determining exploration targets is capitalised
initially within intangible assets as drilling costs. Drilling
costs are initially capitalised on a licence by licence basis until
the success or otherwise has been established. Drilling costs are
written off unless the results indicate that reserves exist and
there is a reasonable prospect that these reserves are commercially
viable. Drilling costs are subsequently transferred into 'Drilling
expenditure' within property, plant and equipment and depreciated
over their estimated useful economic life.
Impairment of Exploration and Evaluation
assets
The Company assesses at each
reporting date whether there is an indication that an asset may be
impaired. This includes consideration of the IFRS 6 impairment
indicators for any intangible exploration and evaluation
expenditure capitalised as intangible assets. Examples of
indicators of impairment include whether:
(a) the period for which the entity
has the right to explore in the specific area has expired during
the period or will expire in the near future and is not expected to
be renewed.
(b) substantive expenditure on
further exploration for and evaluation of mineral resources in the
specific area is neither budgeted nor planned.
(c) exploration for and evaluation
of mineral resources in the specific area have not led to the
discovery of commercially viable quantities of mineral resources
and the entity has decided to discontinue such activities in the
specific area.
(d) sufficient data exist to
indicate that, although a development in the specific area is
likely to proceed, the carrying amount of the exploration and
evaluation asset is unlikely to be recovered in full from
successful development or by sale.
If any such indication exists, or
when annual impairment testing for an asset is required, the
Company makes an estimate of the asset's recoverable amount, which
is the higher of its fair value less costs to sell and its value in
use. Any impairment identified is recorded in the statement of
comprehensive income.
MILA RESOURCES PLC
Notes to the financial statements
For
the six months ended 31 December 2023
3
Share-based
payments
The Company records charges for
share-based payments.
For warrant-based or option-based
share-based payments, to determine the value of the warrants or
options, management estimate certain factors used in the Black
Scholes Pricing Model, including volatility, vesting date exercise
date of the warrants or option and the number likely to vest. At
each reporting date during the vesting period management estimate
the number of shares that will vest after considering the vesting
criteria. If these estimates vary from actual occurrence, this will
impact on the value of the equity carried in reserves.
4
Taxation
No tax is applicable to the Company
for the six months ended 31 December 2023. No deferred income tax
asset has been recognised in respect of the losses carried forward,
due to the uncertainty as to whether the Company will generate
sufficient future profits in the foreseeable future to prudently
justify this.
5
Earnings per
share
Basic earnings per ordinary share is
calculated by dividing the loss attributable to equity holders of
the Company by the weighted average number of ordinary shares in
issue during the period. Diluted earnings per share is calculated
by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary
shares.
The diluted profit per share is the
same as the basic profit per share because all warrants and options
in issue were out of the money at 31 December 2023 and the Company
reported a loss, hence including the additional dilution would have
resulted in a reduction of the loss per share.
|
Earnings
£
|
Weighted average number of
shares
unit
|
Per-share
amount
pence
|
Loss per
share attributed
to
ordinary shareholders
|
(321,436)
|
365,310,859
|
(0.09)p
|
6
Exploration and
evaluation assets
|
At 31
December 2023
Unaudited
|
At
31
December 2022
Unaudited
|
At 30
June 2023
Audited
|
|
£
|
£
|
£
|
Cost
|
|
|
|
Opening
balance
|
5,535,102
|
4,698,625
|
4,698,625
|
Exploration
costs capitalised in the period
|
147.823
|
836,477
|
1,092,201
|
Other
movements
|
-
|
-
|
(184,956)
|
Net book
value
|
5,682,925
|
5,535,102
|
5,605,870
|
|
|
|
|
MILA RESOURCES PLC
Notes to the financial statements
For
the six months ended 31 December 2023
In November 2021, the Company
acquired a 30% interest in the Kathleen Valley (Gold) Project. The
principal assets are leases with rights to exploration in Western
Australia. At the period end the capitalised exploration and
evaluation assets totalled £5.7m (31 December 2022: £5.5m) and all
such costs capitalised related to exploration and evaluation
activities conducted in relation to the Kathleen Valley
Project.
Exploration and evaluation assets
are regularly reviewed for indicators of impairment. If an
indicator of impairment is found an impairment test is required,
where the carrying value of the asset is compared with its
recoverable amount. The recoverable amount is the higher of the
assets fair value less costs to sell and value in use. The
Directors are satisfied that no impairments are required for the
current period.
7
Share
capital
|
Number
|
Share
|
Share
|
|
|
of
shares
|
capital
|
premium
|
Total
|
|
In
issue
|
£
|
£
|
£
|
|
|
|
|
|
Balance at
30 June 2023
|
336,817,708
|
3,368,178
|
4,784,603
|
8,152,781
|
Capital
Raise
|
200,000,000
|
2,000,000
|
-
|
2,000,000
|
Issue
Costs
|
-
|
-
|
(289,845)
|
(289,845)
|
Balance at
31 December 2023
|
536,817,708
|
5,368,178
|
4,494,758
|
9,862,936
|
The Company issued a total of
200,000,000 new fully paid ordinary shares during the
period.
In November 2023, the Company
completed a placing of 200,000,000 fully paid ordinary shares with
a nominal value of £0.01, raising gross proceeds of £2m before
expenses.
MILA RESOURCES PLC
Notes to the financial statements
For
the six months ended 31 December 2023
As at 31 December, 2023 the Company
also has the following options and warrants:
Warrants and Options in
Issue
|
Number of
Options in Issue
|
Number of
Warrants in Issue
|
Weighted
average exercise price
|
Expiry
date
|
|
|
|
|
|
|
|
|
|
|
At 30 June 2022
|
6,000,000
|
253,469,111
|
£0.0429
|
|
Expired during the year
|
-
|
(11,425,000)
|
£0.048
|
31 Dec
2022
|
At 30 June 2023
|
6,000,000
|
242,044,111
|
£0.0432
|
|
Warrants
issued to investors as part of £2m Capital Raise in Nov 2023 - per
the prospectus
|
-
|
200,000,000
|
£0.02
|
7 Nov
2025
|
Warrants
issued as part of previous Capital Raise in Oct / Nov 2022
(1)
|
-
|
30,983,982
|
£0.048
|
4 Oct
2025
|
At 31 December 2023
|
6,000,000
|
473,028,093
|
£0.035
|
|
During the period the Company raised
£2m (before expenses) through a Placing of 200m New Ordinary Shares
of GBP0.01 each ("Placing Shares") at a price of 1 pence per
Placing Share. Investors in the Placing also received one
two-year warrant per Placing Share to subscribe for one new
ordinary share at a cost of 2p per share.
(1) In October & November 2022
the Company raised £908,000 (before expenses) through a Placing of
30,266,651 New Ordinary Shares of GBP0.01 each at a price of 3
pence per Placing Share. Investors in this Placing also received
one three-year warrant per Placing Share to subscribe for one new
ordinary share at a cost of 4.8p per share. In addition, the
Company also issued 717,331 broker warrants that are exercisable at
3p for a period of 3 years. Both the investor warrants and broker
warrants were conditional on shareholder approval to increase the
Company's share authorities. This approval was granted on the 8th
of November 2023.
8. Subsequent
events
Conversion of AUD$100,000 convertible loan note into Mila
ordinary shares
In July 2023 the Company announced
that, together with the other owners of the Kathleen Valley
licence, it had entered into an option agreement with a subsidiary
of Liontown Resources Limited (ASX: LTR), granting Liontown the
option to explore for lithium on the Kathleen Valley Licence Area
in Western Australia.
As part of that that arrangement
Liontown invested A$100,000 in Mila through a convertible
loan.
Following an
amendment of the terms of the Convertible Loan Note in January
2024, Liontown agreed that Mila would convert the AS$100,000 into
5,147,475 fully paid Mila Ordinary Shares at a conversion price of
1 pence per share. In addition, Mila has also agreed to issue
Liontown warrants to subscribe for up to a further 5,147,475
Ordinary Shares exercisable at a price of 2 pence per share at any
time until 29 January 2027.