TIDMSTGR
RNS Number : 8558H
Stratmin Global Resources PLC
26 June 2013
26 June 2013
StratMin Global Resources Plc
("StratMin" or the "Company")
Final Results for the Year to 31 December 2012
StratMin Global Resources Plc (AIM: STGR), the graphite
production and exploration company with assets in Madagascar, today
announces final results for the year to 31 December 2012. The
Company was only constituted in its present form in January 2013
following a reverse takeover and placing. Consequently, the period
under review includes costs but no revenues from the Company's
continuing business of graphite production and exploration in
Madagascar.
CHAIRMAN'S STATEMENT
I am pleased to present to shareholders the results for the year
ended 31 December 2012. The year marked my first complete year as
Chairman of the Company.
To briefly summarise 2012, we completed a strategic review and
with the help of new board member Jeff Marvin and former member
Martin Kiersnowski (Chairman 2010/2011), we put forward for
shareholder approval, at the 1 March 2012 general meeting,
proposals to broaden the investment policy of the Company, update
the Articles of Association of the Company to conform with the 2006
Companies Act, and change the name to StratMin Global Resources
Plc, each of which were subsequently approved by shareholders. At
the same time we were also able to announce that we had invested
$1.275m in Graphmada, a non-listed graphite mining company in
Madagascar.
As a result of the strategic review, your board identified
graphite as a strategic mineral and Graphmada as a company with
significant growth potential. In accordance with our business
objectives we continued to nurture and provide strategic advice to
Graphmada. We welcomed Manoli Yannaghas as a non-executive Director
with substantial natural resource and mining experience.
Throughout the year we progressed our plans to reverse Graphmada
into the Company and completed this transaction in January 2013.
Since then we have been operating as a mining company with a focus
on Graphite. With the reverse takeover, we welcomed two new
Directors to our board, Mr. David Premraj and Mr. Marius Pienaar
who represent the interests of the Graphmada shareholders. To
provide you with further information on our progress since January,
I refer shareholders to our operational update announced shortly
after these results.
Your board continues to seek opportunities and strategies to
enhance shareholder value.
I look forward to providing further news as appropriate in the
near future.
Thank you for your continued support.
Gobind Sahney, Chairman
25 June 2012
Group Income Statement
2012 2011
GBP'000 GBP'000
--------------------------------------- -------- --------
Continuing operations
Administrative expenses (847) (301)
Other operating income (389) 212
Other operating expenses - (146)
Operating loss (1,236) (235)
Investment income - 1
Finance costs (8) -
Loss before tax (1,244) (234)
Tax - -
Loss for the period (1,244) (234)
Loss attributable to equity holders of
the parent (1,244) (234)
Loss per share
From continuing operations
Basic and diluted(pence) (1.6) (0.4)
Group Statement of Comprehensive Income
2012 2011
GBP'000 GBP'000
--------------------------------------- -------- --------
Loss for the year (1,244) (234)
Other comprehensive income:
Exchange differences on translation of
foreign operations - (4)
Market value adjustment to investments 189 (856)
Other comprehensive income/(expense)
for the period 189 (860)
Total comprehensive loss for the year
attributable to equity holders of the
parent (1,055) (1,094)
--------------------------------------- -------- --------
Group Statement of Financial Position
2012 2011
GBP'000 GBP'000
Non-Current assets
Available for sale investments 859 579
Loans to associates 118 -
977 579
------------------------------- -------- --------
Current assets
Trade and other receivables 60 35
Cash and cash equivalents 185 336
245 371
Current liabilities
Trade and other payables 148 85
148 85
------------------------------- -------- --------
Net assets/(liabilities) 1,074 865
------------------------------- -------- --------
Equity
Share capital 362 255
Share premium account 28,170 27,128
Investment reserve (667) (856)
Other reserves 2,372 2,372
Retained earnings (29,163) (28,034)
Total equity 1,074 865
------------------------------- -------- --------
Consolidated Statement of Changes in Equity
Share Investment Other Retained
capital Share Premium reserve reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- -------- ------------- ----------- -------- --------- -------
Balance at 1 January
2011 202 26,680 - 2,372 (27,796) 1,458
Loss for the year - - - - (234) (234)
Other comprehensive
loss for the period - - (856) - (4) (860)
Total comprehensive
loss for the year - - (856) - (238) (1,094)
Net proceeds of share
issues 53 448 - - - 501
Balance at 31 December
2011 255 27,128 (856) 2,372 (28,034) 865
Loss for the year - - - - (1,244) (1,244)
Other comprehensive
income for the period - - 189 - 189
Total comprehensive
income for the year - - 189 - (1,244) (1,055)
Net proceeds of share
issues 107 1,042 - - - 1,149
Share based payment
charge - - - - 115 115
Balance at 31 December
2012 362 28,170 (667) 2,372 (29,163) 1,074
The Company acquired the entire issued share capital of Direct
Excellence Limited (previously known as Interactive Prospect
Targeting Limited) pursuant to a share for share exchange on 1
December 2004. The Other reserve reflects the difference between
the nominal value of the shares issued to acquire Direct Excellence
Limited (previously known as Interactive Prospect Targeting
Limited) and the cumulative value of the Company's share capital
and share premium account at the date of acquisition.
Group Statement of Cash Flow
2012 2011
GBP'000 GBP'000
---------------------------------------------- -------- --------
PROFIT FOR THE YEAR
From continuing operations (1,244) (234)
Adjusted for:
Finance expense 8 -
Investment income - (1)
Share based payment charge 115 -
Shares and loan notes issued in settlement
of fees 57 88
Gain arising on settlement of loan notes - (148)
Loss/(profit) on disposal of investments 389 (29)
Operating cash flows before movements in
working capital (675) (324)
Decrease in trade and other receivables (25) (11)
Decrease in trade and other payables 63 (57)
Net cash from operations (637) (392)
---------------------------------------------- -------- --------
INVESTING ACTIVITIES
Purchases of investments (827) (2,669)
Proceeds from the disposal of investments 347 1,263
Loans to associated companies (118) -
Investment income - 1
Net cash generated from investing activities (598) (1,405)
---------------------------------------------- -------- --------
FINANCING ACTIVITIES
Proceeds from share issues 1,092 471
Proceeds from issue of loan notes - 240
Repayment of loan notes - (150)
Interest paid (8) -
Net cash used in financing activities 1,084 561
Net (decrease)/increase in cash and cash
equivalents (151) (1,236)
Cash and cash equivalents at beginning of
year 336 1,576
Effect of foreign exchange rate changes - (4)
Cash and cash equivalents at end of year 185 336
---------------------------------------------- -------- --------
Notes
The contents of this announcement have been extracted from the
Company's Annual Report, which is currently in print and will be
distributed within the week. The information shown for the years
ended 31 December 2012 and 31 December 2011 does not constitute
statutory accounts and has been extracted from the full accounts
for the years ended 31 December 2012 and 31 December 2011. The
accounts for the year ended 31 December 2011 have been filed with
the Registrar of Companies. The accounts for the year ended 31
December 2012 will be delivered to the Registrar of Companies in
due course.
1. General Information
StratMin Global Resources Plc is a company incorporated in the
United Kingdom under the Companies Act 2006.
2. Accounting Policies
The principal accounting policies adopted are set out below:
Basis Of Accounting
The financial statements have been prepared on the historic
cost basis and in accordance with International Financial Reporting
Standards (IFRS) as adopted for use in the European Union and
therefore comply with Article 4 of the EU IAS Regulation.
Going Concern
Any consideration of the foreseeable future involves making
a judgment, at a particular point in time, about future events
which are inherently uncertain. The ability of the Group to
carry out its planned business objectives is dependent on its
continuing ability to raise adequate financing from equity investors
and/or the achievement of profitable operations.
Nevertheless, at the time of approving these Financial Statements
and after making due enquiries, the Directors have a reasonable
expectation that the Group has adequate resources to continue
operating for the foreseeable future. For this reason they continue
to adopt the going concern basis in preparing the Financial
Statements.
Basis of Consolidation
The Group's consolidated financial statements incorporate the
financial statements of StratMin Global Resources Plc (the "Company")
and entities controlled by the Company (its subsidiaries). Control
is achieved where the Company has the power to govern the financial
and operating policies of an investee entity so as to obtain
benefits from its activities.
The results of subsidiaries disposed of during the year are
included in the Group income statement from the effective date
of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements
of subsidiaries to bring the accounting policies used into line
with those used by the Group.
All intra-group transactions, balances, income and expenses
are eliminated on consolidation.
Business Combinations
The acquisition of subsidiaries is accounted for using the purchase
method. The cost of the acquisition is measured at the aggregate
of the fair values, at the date of exchange, of assets given,
liabilities incurred or assumed, and equity instruments issued
by the Group in exchange for control of the acquiree, plus any
costs directly attributable to the business combination. The
acquiree's identifiable assets, liabilities and contingent liabilities
that meet the conditions for recognition under IFRS 3 are recognised
at their fair value at the acquisition date, except for non-current
assets (or disposal groups) that are classified as held for
resale in accordance with IFRS 5 Non-current Assets Held for
Sale and Discontinued Operations, which are recognised and measured
at fair value less costs to sell.
Goodwill arising on acquisition is recognised as an asset and
initially measured at cost, being the excess of the cost of
the business combination over the Group's interest in the net
fair value of the identifiable assets, liabilities and contingent
liabilities recognised. If, after reassessment, the Group's
interest in the net fair value of the acquirer's identifiable
assets, liabilities and contingent liabilities exceed the cost
of the business combination, the excess is recognised immediately
in profit or loss.
Available For Sale Investments
Investments are initially measured at fair value plus incidental
acquisition costs. Subsequently, they are measured at fair value
in accordance with IAS 39. This is either the bid price or the
last traded price, depending on the convention of the exchange
on which the investment is quoted.
Investments are recognised as available-for-sale financial assets.
Gains and losses on measurement are recognised in other comprehensive
income except for impairment losses and foreign exchange gains
and losses on monetary items denominated in a foreign currency,
until the assets are derecognised, at which time the cumulative
gains and losses previously recognised in other comprehensive
income are recognised in profit or loss.
The Company assesses at each year end date whether there is
any objective evidence that a financial asset or group of financial
assets classified as available-for-sale has been impaired. An
impairment loss is recognised if there is objective evidence
that an event or events since initial recognition of the asset
have adversely affected the amount or timing of future cash
flows from the asset. A significant or prolonged decline in
the fair value of a security below its cost shall be considered
in determining whether the asset is impaired.
When a decline in the fair value of a financial asset classified
as available-for-sale has been previously recognised in other
comprehensive income and there is objective evidence that the
asset is impaired, the cumulative loss is removed from other
comprehensive income and recognised in profit or loss. The loss
is measured as the difference between the cost of the financial
asset and its current fair value less any previous impairment.
Foreign Currencies
The individual financial statements of each group company are
presented in the currency of the primary economic environment
in which it operates (its functional currency). For the purpose
of the Group financial statements, the results and financial
position of each group company are expressed in Pounds Sterling,
which is the functional currency of the Company, and the presentation
currency for the Group financial statements.
In preparing the financial statement of the individual companies,
transactions in currencies other than the entity's functional
currency (foreign currencies) are recorded at the rates of exchange
prevailing on the dates of the transactions. At each year end
date, monetary assets and liabilities that are denominated in
foreign currencies are retranslated at the rates prevailing
on the year end date. Non-monetary items carried at fair value
that are denominated in foreign currencies are translated at
the rates prevailing at the date when the fair value was determined.
Non-monetary items that are measured in terms of historical
cost in a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary items,
and on the retranslation of monetary items, are included in
profit or loss for the period. Exchange differences arising
on the retranslation of non-monetary items carried at fair value
are included in profit or loss for the period, except for differences
arising on the retranslation of non-monetary items in respect
of which gains and losses are recognised directly in equity.
For such non-monetary items, any exchange component of that
gain or loss is also recognised directly in equity.
For the purpose of presenting Group financial statements, the
assets and liabilities of the Group's foreign operations are
translated at exchange rates prevailing on the year end date.
Income and expense items are translated at the average exchange
rates for the period. Exchange differences arising are classified
as equity and transferred to the Group's translation reserve.
Such translation differences are recognised as income or as
expenses in the period in which the operation is disposed of.
Goodwill and fair value adjustments arising on the acquisition
of a foreign entity are treated as assets and liabilities of
the foreign entity and translated at the closing rate.
Taxation
The tax expense represents the sum of the tax currently payable
and deferred tax.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from net profit as reported in
the income statement because it excludes items of income or
expense that are taxable or deductible in other years and it
further excludes items that are never taxable or deductible.
The Group's liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the
year end date.
Deferred tax is the tax expected to be payable or recoverable
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 the 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 tax 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 Group 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
year end 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 is realised.
Deferred tax is charged or credited in the income statement,
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 where they relate to income taxes
levied by the same taxation authority and the Group intends
to settle its current tax assets and liabilities on a net basis.
Impairment of Tangible and Intangible Assets Excluding Goodwill
At each financial year end date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine whether
there is any indication that those assets have suffered an impairment
loss. If any such indication exists, the recoverable amount
of the asset is estimated in order to determine the extent of
the impairment loss, if any. Where the asset does not generate
cash flows that are independent from other assets, the Group
estimates the recoverable amount of the cash-generating unit
to which the asset belongs. An intangible asset with an indefinite
useful life is tested for impairment annually and whenever there
is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments
of the time value of money and the risks specific to the asset
for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset or cash-generating unit
is estimated to be less than its carrying amount, the carrying
amount of the asset or cash-generating unit is reduced to its
recoverable amount and the impairment loss is recognised as
an expense immediately.
When an impairment loss subsequently reverses, the carrying
amount of the asset or cash-generating unit is increased to
the revised estimate of its recoverable amount, but so that
the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been
recognised for the asset or cash-generating unit in prior years.
A reversal of an impairment loss is recognised as income immediately,
unless the relevant asset is carried at a revalued amount, in
which case the reversal of the impairment loss is treated as
a revaluation increase.
Financial Instruments
Financial assets and financial liabilities are recognised on
the Group's Statement of financial position when the Group becomes
a party to the contractual provisions of the instrument.
Trade Receivables
Trade receivables do not carry any interest and are measured
at their nominal value as reduced by any appropriate allowances
for irrecoverable amounts.
Cash and Cash Equivalents
Cash and cash equivalents comprise cash on hand and demand deposits
and other short-term highly liquid investments that are readily
convertible to a known amount of cash and are subject to an
insignificant risk of changes in value.
Financial Liabilities and Equity Instruments
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into. An equity instrument is any contract that evidences a
residual interest in the assets of the Group after deducting
all of its liabilities.
Bank Borrowings
Interest-bearing bank loans and overdrafts are recorded at the
proceeds received, net of direct issue costs. Finance charges
are accounted for on an accruals basis in profit or loss using
the effective interest rate method and are added to the carrying
amount of the instrument to the extent that they are not settled
in the period in which they arise.
Trade Payables
Trade payables are not interest bearing and are stated at their
nominal value.
Equity Instruments
Equity instruments issued by the Company are recorded at the
proceeds received, net of direct issue costs.
Share-Based Payments
The Group has applied the requirements of IFRS 2 Share-based
payments. In accordance with the transitional provisions, IFRS
2 has been applied to all grants of equity instruments after
7 November 2002 that were unvested at 1 January 2005.
The Group operates a number of equity-settled share-based payment
schemes under which share options are issued to certain employees.
Equity-settled share-based payments are measured at fair value
(excluding the effect of non market-based vesting conditions)
at the date of grant. The fair value determined at the grant
date of the equity-settled share-based payments is expensed
on a straight-line basis over the vesting period, based on the
Group's estimate of shares that will eventually vest and adjusted
for the effect of non market-based vesting conditions.
Fair value is measured by use of the Black Scholes model. The
expected life used in the model has been adjusted, based on
management's best estimate, for the effects of non-transferability,
exercise restrictions, and behavioural considerations.
3. Critical Accounting Judgements and Estimations
In the application of the Company's accounting policies, which
are described in note 3, the Directors are required to make
judgements, estimates and assumptions about the carrying amounts
of assets and liabilities that are not readily apparent from
other sources. The estimates and associated assumptions are
based on historical experience and other factors that are considered
to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an
on-going basis. Revisions to accounting estimates are recognised
in the period. Judgements and estimates that may affect future
periods are as follows:
Going Concern
The Group's activities are not currently generating any revenue,
it incurred a loss of GBP1,244,000 during the year (2011: GBP234,000
loss), had a cash balance of GBP185,000 as at 31 December 2012
and as at the date of signing the accounts was yet to reach
full production at the mine-site.
However, after making enquiries, the Directors have formed a
judgement that there is a reasonable expectation that the Company
can secure adequate resources to continue in operational existence
for the foreseeable future and that adequate arrangements will
be in place to enable the settlement of this financial commitment.
For this reason, the Directors continue to adopt the going concern
basis in preparing the financial statements. Whilst there are
inherent uncertainties in relation to future events, and therefore
no certainty over the outcome of the matters described, the
Directors consider that, based upon financial projections and
dependent on the success of their efforts to complete these
activities, the Company will be a going concern for the next
twelve months. If it is not possible for the Directors to realise
their plans, over which there is significant uncertainty, the
carrying value of the assets of the company is likely to be
impaired.
4. Segmental information
A segment is a distinguishable component of the Company's activities
from which it may earn revenues and incur expenses, whose operating
results are regularly reviewed by the Company's chief operating
decision maker to make decisions about the allocation of resources
and assessment of performance and about which discrete financial
information is available.
As the chief operating decision maker reviews financial information
for and makes decisions about the Company's investment activities
as a whole, the directors have identified a single operating
segment, that of holding and trading in investments in natural
resources, minerals, metals, and oil and gas projects. The directors
consider that it would not be appropriate to disclose any geographical
analysis of the Company's investments.
5. Operating loss
2012 2011
GBP\'000 GBP'000
----------------------------------------------------- --------- -----------
Operating loss is stated after charging:
Staff costs 23 132
----------------------------------------------------- --------- -----------
6. Other Operating (Expense)/Income
2012 2011
GBP'000 GBP'000
Realised (losses)/gains on disposal of investments (389) 29
Discount on settlement of loan notes - 148
Refund of overpaid PAYE in respect of unapproved
option scheme - 35
(389) 212
------------------------------------------------------------ --------- ---------
7. Other operating expenses
2012 2011
GBP'000 GBP'000
Compensation for loss of office - 40
Compensation payment to former director - 70
Loss on foreign currency transactions - 36
- 146
------------------------------------------------------------ ---------
8. Taxation
There is no tax charge/credit in 2012 or 2011.
The UK corporation tax rate applicable for 2012 is 26% (2011:
26.5%). The average rate for 2011 was 26.5%.
Reconciliation of tax charge:
2012 2012 2011 2011
GBP'000 % GBP'000 %
------------------------------------- --------- ----- --------- ------
Loss on ordinary activities before
tax (1,244) (234)
Tax at the UK corporation tax
rate of 26% (2010: 26.5%) 323 26% 62 26.5%
Effects of:
Tax effect of expenses that are
not deductible in determining
taxable profit (1) (13)
Unutilised tax losses carried
forward (322) (49)
Tax charge for period - -
------------------------------------- --------- ----- --------- ------
9. Loss per Share
2012 2011
Profit/ Number Pence Profit/ Number Pence
(loss) of shares per share (loss) of shares per share
GBP'000 '000 GBP'000 '000
Basic and diluted loss
per share (1,244) 77,279 (1.6) (234) 57,471 (0.4)
Since the Company has incurred losses in both 2011 and 2012 the
basic loss and the diluted loss per share are the same as the
effect of exercise of options and warrants is not dilutive.
10. Available-for-Sale Investments
2012 2011
GBP'000 GBP'000
--------------------------------------- ------- -------
Net book value at 1 January 579 -
Purchases of investments 827 2,669
Proceeds from sale of investments (347) (1,263)
(Loss)/gain on disposal of investments (389) 29
--------------------------------------- ------- -------
670 1,435
Market value adjustment 189 (856)
--------------------------------------- ------- -------
Net book value at 31 December 859 579
--------------------------------------- ------- -------
11. Trade and Other Receivables
2012 2011
GBP'000 GBP'000
------------------------------- ------- -------
Other receivables 7 28
Prepayments and accrued income 53 7
------------------------------- ------- -------
60 35
------------------------------- ------- -------
12. Cash and Cash Equivalents
2012 2011
GBP'000 GBP'000
--------------------------- ------- -------
Cash and cash equivalents 185 336
--------------------------- ------- -------
13. Trade and Other Payables
2012 2011
GBP'000 GBP'000
-------------------------------- ------- -------
Amounts owed to group companies - -
Trade payables 105 45
Other payables 5 9
Accrued expenses 38 31
-------------------------------- ------- -------
148 85
-------------------------------- ------- -------
The Directors consider the carrying amount of trade payables
approximates to their fair value.
14. Financial Instruments
Financial Assets By Category
The IAS 39 categories of financial assets included in the balance
sheet and the headings in which they are included are as follows:
2012 2011
GBP'000 GBP'000
----------------------------------------------------- --- ------------ ------------
Financial assets:
Cash and cash equivalents 185 336
Available for sale investments 859 579
Loans and receivables 125 28
1,169 943
----------------------------------------------------- --- ------------ ------------
Financial Liabilities By Category
The IAS 39 categories of financial liability included in the
balance sheet and the headings in which they are included are
as follows:
2012 2011
GBP'000 GBP'000
----------------------------------------------------- --- ------------ ------------
Financial liabilities at amortised cost:
Trade and other payables 110 54
----------------------------------------------------- --- ------------
110 54
----------------------------------------------------- --- ------------ ------------
Capital Risk Management
The Group manages its capital to ensure that entities in the
Group will be able to continue as a going concern while maximising
the return to stakeholders through the optimisation of the debt
and equity balance. The capital structure of the Group consists
of debt, (previously includes the borrowings) cash and cash
equivalents and equity attributable to equity holders of the
Parent Company, comprising issued capital, reserves and retained
earnings, all as disclosed in the Statement of Financial Position.
Significant Accounting Policies
Details of the significant accounting policies and methods adopted,
including the criteria for recognition, the basis of measurement
and the basis on which income and expenses are recognised, in
respect of each class of financial asset, financial liability
and equity instrument are disclosed in note 3 to the financial
statements.
Financial Risk Management Objectives
The Company is exposed to a variety of financial risks which
result from both its operating and investing activities. The
Company's risk management is coordinated by the board of directors,
and focuses on actively securing the Company's short to medium
term cash flows by minimising the exposure to financial markets.
Market Price Risk
The Company's exposure to market price risk mainly arises from
potential movements in the fair value of its investments. The
Company manages this price risk within its long-term investment
strategy to manage a diversified exposure to the market. If
each of the Company's equity investments were to experience
a rise or fall of 5% in their fair value, this would result
in the Company's net asset value and statement of comprehensive
income increasing or decreasing by GBP44,000 (2011: GBP156,000).
Foreign Currency Risk Management
The Group undertakes certain transactions denominated in foreign
currencies. Hence, exposures to exchange rate fluctuations arise.
However since the discontinuation of the Group's operations
in France the foreign currency risk is not material and there
is currently no policy in place to minimise this risk. The Directors
will consider implementing a foreign currency risk management
policy if circumstances change.
Interest Rate Risk Management
The Group's exposures to interest rates on financial assets
and financial liabilities are detailed in the liquidity risk
management section of this note.
The sensitivity analyses below have been determined based on
the exposure to interest rates for both derivatives and non-derivative
instruments during the year.
Increase/(decrease) in
profit before tax
Group Group
2012 2011
GBP'000 GBP'000
--------------------------------------------- -------------------- -----------------
Increase interest rate by 1% - 16
Decrease interest rate by 1% - (16)
There would have been no effect on amounts recognised directly
in equity.
Credit Risk Management
The Company's financial instruments, which are subject to credit
risk, are considered to be cash and cash equivalents and trade
and other receivables, and its exposure to credit risk is not
material. The credit risk for cash and cash equivalents is considered
negligible since the counterparties are reputable banks.
The Group's maximum exposure to credit risk is GBP310,000 (2011:
GBP364,000) comprising other receivables and cash.
Liquidity Risk Management
Ultimate responsibility for liquidity risk management rests
with the Board of Directors, which monitors the Group's short,
medium and long-term funding and liquidity management requirements
on an appropriate basis. The Group manages liquidity risk by
maintaining adequate reserves, banking facilities and reserve
borrowing facilities. The Group's liquidity risk arises in supporting
the trading operations in the subsidiaries, which hopefully
will start to generate profits and positive cash-flows in the
short to medium term. However, as referred to in Note 4 the
Company is currently exposed to significant liquidity risk and
needs to obtain external funding to support the Group going
forwards.
15. Deferred Tax
At the year end date, the Group had unused tax losses of GBP3.2m
(2011: GBP2.2m) available for offset against future profits.
No deferred tax asset has been recognised in respect of these
losses (2011: GBPnil) due to the unpredictability of future profit
streams.
At 31 December 2012, the aggregate amount of temporary differences
associated with undistributed earnings of the Group for which
deferred tax liabilities have not been recognised was GBPnil
(2011: GBPnil). No liability has been recognised in respect of
these differences because the Group is in a position to control
the timing of the reversal of these differences and either it
is possible that such differences will not reverse in the foreseeable
future or no tax is payable on the reversal.
16. Called up share capital
2012 2011
GBP'000 GBP'000
----------------------------------------------- ---------- ----------
Called up, allotted and fully paid
90.6m (2011: 63.9m) ordinary shares of
0.4p each 362 255
----------------------------------------------- ---------- ----------
On 10 April 2012, 500,000 ordinary shares were issued at 4p
each to in settlement of consultancy fees.
On 16 May 2012, 12,500,000 ordinary shares were issued at 4p
each as the result of a placing, raising GBP500,000 before
expenses.
On 18 May 2012, 4,916,667 ordinary shares were issued at 6p
each as the result of a placing, raising GBP295,000 before
expenses.
On 29 August 2012, 511,265 ordinary shares were issued at 4.25p
each to in settlement of fees.
On 3 October 2012, 8,000,000 ordinary shares were issued at
5p each as the result of a placing, raising GBP400,000 before
expenses.
On 26 October 2012, 310,000 ordinary shares were issued at
5p each to a director in settlement of an entitlement under
his service contract.
Warrants
On 17 August 2012, warrants to subscribe for 625,000 ordinary
shares at 4p per share were granted to Optiva Securities Ltd,
exercisable on or before 15 August 2015.
On 5 October 2012, warrants to subscribe for 400,000 ordinary
shares at 5p per share were granted to Optiva Securities Ltd,
exercisable on or before 4 October 2015.
17. Share-Based Payments
Equity-Settled Share Option Schemes
The Group has granted options to certain directors and employees.
Options are exercisable at a price equal to the average quoted
market price of the Company's shares on the date of grant.
If the options remain unexercised after a period of 10 years
from the date of grant the options expire. Options are forfeited
if the employee leaves the Group before the options vest.
On 2 March 2012 the Company granted options over 4,790,403
shares each to Gobind Sahney and Jeff Marvin. The options are
exercisable at any time until 1 March 2022 at 2.25p per share.
The estimated fair value of the options granted was calculated
by applying the Black-Scholes option pricing model. The assumptions
used in the calculation were as follows:
Share price at date of grant 2.25 pence
Exercise price 2.25 pence
Expected volatility 40%
Expected dividend Nil
Vesting criteria Exercisable on date of grant
Contractual life 10 years
Risk free rate 2.5%
Estimated fair value of each 1.21 pence
warrant
Details of the options and warrants outstanding during the
year are as follows:
2012 2011
Number of Weighted Number Weighted
options average exercise of options average
price exercise
price
000's GBP 000's GBP
Outstanding at the beginning
of the year 100 1.0700 100 1.070
Granted during the year 9,581 0.0225 - -
Lapsed during the year (100) 1.0700 - -
Outstanding at the end
of the year 9,581 0.0225 100 1.070
Exercisable at the end
of the year 9,581 0.0225 62 1.580
The options outstanding at 31 December 2012 had a weighted
average exercise price of 2.25p and a weighted average remaining
contractual life of 9.2 years.
The charge in the income statement in respect of options in
2012 was GBP115,000 (2011: GBPnil).
18. Post Year End Events
On 28 January 2013 the following events took place:
* The shareholders approved the consolidation of the
Company's shares on the basis of one new ordinary
share of 4p for every ten existing ordinary shares of
0.4p.
* The Company completed the acquisition of Graphmada
Equity Pte Limited, a graphite mining business, based
in Madagascar. The consideration for the acquisition
was GBP25.5 million satisfied through the issue of 51
000,000 new ordinary shares
* The Company completed the placing of 30,060,000
convertible loan notes of 5p each, raising a total of
approximately GBP1.5 million.
On 25 February 2013, the Company issued 216,000 new ordinary
shares of 4p each to satisfy certain existing commitments.
On 7 March 2013, the Company issued 102,500 new ordinary shares
of 4p each following the exercise of warrants.
On 16 April 2013, the Company issued 17,499 new ordinary shares
of 4p each following the exercise of warrants.
On 16 June 2013, the Company issued 126,620 new ordinary shares
of 4p each to satisfy certain existing commitments.
19 Annual General Meeting
The 2013 Annual General Meeting of the Company will be held
at 9.30 a.m. on 19 July 2013 at the offices of Speechly Bircham
LLP, 6 New Street Square, London EC4A 3LX. Notice of the Meeting
has been sent to shareholders today, along with the Annual
Report & Accounts if specifically requested. The Notice of
Meeting and the Annual Report & Accounts will also be available
shortly on the Company's web site at www.stratminglobal.com
For further information please visit www.stratminglobal.com or
contact:
StratMin Global Resources Plc
+44 (0) 20 7467
Gobind Sahney 1700
Libertas Capital Corporate Finance Limited
(Nomad and Joint Broker)
+44 (0) 20 7569
Sandy Jamieson 9650
Peterhouse Corporate Finance
(Joint Broker)
+ 44 (0) 20 7562
Jon Levinson 3357
Optiva Securities Limited
(Joint Broker)
+44 (0) 20 3137
Jeremy King 1904
Tavistock Communications
(Financial PR and IR)
+44 (0) 20 7920
Jessica Fontaine/Simon Hudson/Conrad Harrington 3150
About StratMin Global Resources:
StratMin Global Resources Plc is a graphite production and
exploration company with assets in Madagascar. Its 100% owned
subsidiary Graphmada ships from its plant located at its Loharano
license area. The Company believes the additional licence areas
owned by Graphmada are highly prospective and provide considerable
exploration and production upside potential.
StratMin Global Resources acquired 100% Graphmada Equity Pte
Ltd, the holding company of Graph Mada SARL, on 28 January
2013.
- ENDS -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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