Botswana Diamonds PLC Annual Results for the Year Ended 30 June 2022 (9643I)

TIDMBOD

RNS Number : 9643I

Botswana Diamonds PLC

08 December 2022

8(th) December 2022

Botswana Diamonds PLC

("Botswana Diamonds" or the "Company")

Annual Results for the Year Ended 30 June 2022

Notice of Annual General Meeting

Botswana Diamonds plc (AIM: BOD) today announces its audited annual results for the year ended 30 June 2022.

Chairman's Statement

Botswana Diamonds (BOD) is a rare animal - a listed diamond explorer. In recent years mineral exploration has gone out of fashion. Explorers spend money and it has become extremely hard to raise exploration finance from either the public or institutions. Money to finance expensive exploration programmes is virtually impossible to raise and yet the potential rewards for a successful discovery are substantial.

The principals in BOD believe that they can deliver meaningful returns to investors. They have done so in their earlier vehicle, African Diamonds, which discovered, with their partners De Beers, what is now Lucara Diamond Karowe mine in Botswana. The BOD directors and employees are very experienced in diamonds, Africa, mining and exploration.

We are using this experience to acquire exploration assets in areas of good diamond potential, Botswana, South Africa, and possibly, Zimbabwe. While we have pure blue sky exploration licences we tend to focus on areas where diamonds have already been discovered but for a variety of reasons the ground has been or is being let go. There is an exploration saying - the best place to find a mine is where there is or was a mine. You can see this approach in our Botswana strategy where we have increased our stake in the Maibwe joint venture, in the acquisition of the KX36 discovery which contains substantial quantities of diamonds and in our unsuccessful attempt to acquire the closed Ghaghoo mine. In South Africa, we have taken our Thorny River project to mining application stage. We would hope to begin production in Q2 / Q3 of 2023. In the meantime, the adjacent Marsfontein ground will be contract mined from early 2023. We have recently been awarded a five-year prospecting licence on the Reivilo cluster of kimberlites in South Africa. We have acquired an extensive body of exploration data on Reivilo in return for a small royalty. We continue to liaise with the authorities in Zimbabwe on entering the diamond sector. There are significant geological opportunities in the country. The objective is to find a formula which suits all parties.

Turning to the diamond market. In a turbulent world it is good to report a significant recovery from the impact of Covid. Diamond mining companies, even the more marginal operators, have had a good post-Covid return to business. Both prices and also volumes have increased, prices substantially. Even more interesting is the large growth in sales in the United States. But global recession and Chinese turbulence suggest the near-term future could be rocky. The growth in sales of Lab Grown Diamonds must be watched but a comparison is the luxury goods sectors. You can buy good quality department store clothes but the luxury clothing sector continues to grow. Likewise, the demand for buying luxury cars still continues to grow. A natural diamond is a rare creation of nature from billions of years ago; these diamonds will certainly endure and natural diamonds are internationally scarce, rare and collectibles.

Projects

Botswana

We are focused on the Kaapvaal craton in Botswana, South Africa and Zimbabwe - an area which hosts, and has hosted, many of the largest and best diamond mines in the world.

Botswana has been our focus. The country is the largest producer by value and is a good country to work in, stable with the Rule of Law. We work in the Kalahari where the sand cover is a major obstacle. Techniques to "see" through the sand are evolving and we are using, and will use, this new technology.

The principle focus during the period under review was the attempt to acquire the Ghaghoo mine in the Kalahari. The mine had a short unsuccessful history and we undertook a study to see if we could improve operational efficiencies and we believe that we can. We needed a partner and we found one who was ultimately unable to provide the required funds. However, we continue to keep a watching brief. The attractions of Ghaghoo is a large deposit of good quality diamonds and a fully built plant and infrastructure. The Government of Botswana have also been most helpful and encouraging from a regulatory perspective.

We own the KX36 discovery to the south of Ghaghoo. We acquired this diamond deposit as part of the acquisition of Sekaka Diamonds, a subsidiary of Petra Diamonds. It is estimated the deposit holds up to 24 million tonnes containing up to 76 carats per hundred tonnes (chpt). Diamond value was previously estimated at $65 a carat and utrestimates are up to $97 a carat. Diamond deposits are very rare and incredibly difficulty to discover.

We hold exploration licences surrounding KX36 where we expect there should be additional kimberlites as it is rare to find one isolated kimberlite. We also hold a 26% interest in the Maibwe kimberlites to the south of KX36.

On our wholly-owned licences in Sunland Minerals we identified 200 priority targets. We have narrowed this to 8 targets that need to be further explored and drilled.

We increased our stake in the Maibwe joint venture to 50% by acquiring a stake from the liquidator of BCL in Botswana. We agreed a 2% royalty on any future production. There are four kimberlite pipes on the licences. A drill programme is needed.

South Africa

We believe that there are big opportunities for diamond exploration and development in South Africa. We are focusing on where we believe the best opportunities are available to BOD.

The Thorny River venture, on which we have spent significant time and money, is likely to begin production in 2023. Thorny River is a kimberlite dyke system which we have demonstrated to be an extension of the Marsfontein and Klipspringer mines. Exploration has identified two deposits which between them contain up to 2m tons. We expect the grade to be between 46 and 74 cpht of good quality diamonds.

We have applied for mining permits which we expect to be issued by mid-2023.

We are working our way through development options on the discovery. We have a proposal from a contractor who would provide all mining and processing equipment in return for a percentage interest. This is being evaluated and considered as a potential viable option.

Mining is expected to begin in the first quarter of 2023on the Marsfontein waste dumps. We mined here previously, but without success. We have identified the causes and the new plan should overcome the previous mining issues.

Neither Thorny River or Marsfontein are company makers but they will provide cash flow and will make BOD a diamond producer.

In recent months we have been awarded a licence on the Reivilo ground. This is a licence of great interest to BOD. It contains kimberlite pipe. We have obtained a databank on Reivilo from Petra in return for a small royalty. We are reviewing this data and plan on processing Petra's drill core for microdiamonds in the near future.

Zimbabwe

Zimbabwe has excellent potential to be a significant diamond producer. BOD has maintained contacts in the country. We had a joint venture with Vast which ultimately came to nothing. We are now actively involved in discussions on a possible entry. Whether this happens or not will depend on the ground offered and on the joint venture terms.

Finance & Future

Exploration companies have no revenues and active explorers spend money. In recent years BOD has been funded by a small group of private investors as little or no funding was available in London or Johannesburg.

Our strategy is clear. To have a pipeline project at every stage of development. Our first production will come on stream in the near future. We have a number of projects where diamond deposits already exist. We have drill ready exploration projects. Our task now is to get our message out to investors.

John Teeling

Chairman

7(th) December 2022

Annual Report and Notice of Annual General Meeting

The Company's Annual Report and Accounts for the year ended 30 June 2022 (the "Annual Report") will be mailed shortly only to those shareholders who have elected to receive it. Otherwise, shareholders will be notified that the Annual Report and Accounts will be available on the website at www.botswanadiamonds.co.uk . Copies of The Annual Report will also be available for collection from the company's registered office at Suite 1, 7th Floor, 50 Broadway, London SW1H 0BL.

The Annual General Meeting ("AGM") is due to be held Thursday 19(th) January 2023 at The Hilton London Paddington, 146 Praed St, London W2 1EE, United Kingdom at 11.00am. A Notice of the AGM will be included in the Annual Report.

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The person who arranged for the release of this announcement on behalf of the Company was John Teeling, Director.

   A copy of this announcement is available on the Company's website, at   www.botswanadiamonds.co.uk 

Enquiries:

 
Botswana Diamonds PLC 
 John Teeling, Chairman                  [phone] 
 James Campbell, Managing Director       [phone] 
 Jim Finn, Director                      [phone] 
Beaumont Cornish - Nominated Adviser 
 Michael Cornish 
 Roland Cornish                         [phone] 
Beaumont Cornish Limited - Broker 
 Roland Cornish 
 Felicity Geidt                        [phone] 
First Equity Limited - Joint Broker 
 Jason Robertson                       [phone] 
BlytheRay - PR                         [phone] 
 Megan Ray                              [phone] 
 Rachael Brooks                         [phone] 
 Said Izagaren                          [phone] 
Teneo 
 Luke Hogg                               [phone] 
 Alan Tyrrell                            [phone] 
 

www.botswanadiamonds.co.uk

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 30 JUNE 2022

 
                                                                       2022         2021 
                                                                        GBP          GBP 
 
 
 Administrative expenses                                          (485,612)    (402,089) 
 
 Impairment of exploration and evaluation assets                  (253,380)     (70,018) 
 
 
 OPERATING LOSS                                                   (738,992)    (472,107) 
 
 
 LOSS FOR THE YEAR BEFORE TAXATION                                (738,992)    (472,107) 
 
 Income tax expense                                                       -            - 
 
 LOSS AFTER TAXATION 
 
 Other Comprehensive Income                                       (738,992)    (472,107) 
 
 Items that may be reclassified subsequently to profit or loss 
 
 Exchange difference on translation of foreign operations            22,562     (85,392) 
 
 
 TOTAL COMPREHENSIVE INCOME FOR THE YEAR                          (716,430)   ( 557,499) 
 
 
 
 
 Loss per share - basic                                             (0.09p)      (0.06p) 
 
 Loss per share - diluted                                           (0.09p)      (0.06p) 
 
 

CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2022

 
                                              30 June 2022   30 June 2021 
                                                       GBP            GBP 
 ASSETS: 
 
 NON CURRENT ASSETS 
 
 Intangible assets                               8,184,621      8,194,032 
 Plant and equipment                               207,640        206,788 
 
                                                 8,392,261      8,400,820 
 
 CURRENT ASSETS 
 
 Other receivables                                  48,981         42,038 
 Cash and cash equivalents                         158,476        164,658 
 
                                                   207,457        206,696 
 
 TOTAL ASSETS                                    8,599,718      8,607,516 
 
 
 LIABILITIES: 
 
 CURRENT LIABILITIES 
 
 Trade and other payables                        (734,181)      (744,149) 
 
 TOTAL LIABILITIES                               (734,181)      (744,149) 
 
 NET ASSETS                                      7,865,537      7,863,367 
 
 
 EQUITY 
 
 Called-up share capital - deferred shares       1,796,157      1,796,157 
 Called-up share capital - ordinary shares       2,197,680      1,981,805 
 Share premium                                  11,487,087     10,984,362 
 Share based payment reserves                      111,189        111,189 
 Retained deficit                              (6,443,797)    (5,704,805) 
 Translation reserve                             (299,492)      (322,054) 
 Other reserve                                   (983,287)      (983,287) 
 
 TOTAL EQUITY                                    7,865,537      7,863,367 
 
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 30 JUNE 2022

 
                                                             Share 
                                  Called-up                  Based 
                                      Share        Share   Payment      Retained   Translation       Other 
                                    Capital      Premium   Reserve       Deficit       Reserve    Reserves       Total 
                                                     GBP       GBP           GBP           GBP         GBP         GBP 
 
 
 At 30 June 2020                  3,474,212   10,564,712   111,189   (5,232,698)     (236,662)   (983,287)   7,697,466 
 
 Issue of shares                    303,750      425,250         -             -             -           -     729,000 
 
 Share issue expenses                     -      (5,600)         -             -             -           -     (5,600) 
 
 Loss for the year and total 
  comprehensive income                    -            -         -     (472,107)      (85,392)           -   (557,499) 
 
 At 30 June 2021                  3,777,962   10,984,362   111,189   (5,704,805)     (322,054)   (983,287)   7,863,367 
 
 Issue of shares                    215,875      522,225         -             -             -           -     738,100 
 
 Share issue expenses                     -     (19,500)         -             -             -           -    (19,500) 
 
 Loss for the year and total 
  comprehensive income                    -            -         -     (738,992)        22,562           -   (716,430) 
 
 At 30 June 2022                  3,993,837   11,487,087   111,189   (6,443,797)     (299,492)   (983,287)   7,865,537 
 
 

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEARED 30 JUNE 2022

 
                                                                 30 June 2022   30 June 2021 
                                                                          GBP            GBP 
 CASH FLOW FROM OPERATING ACTIVITIES 
 
 Loss for the year                                                  (738,992)      (472,107) 
 
 Foreign exchange losses                                               15,932        (4,187) 
 Impairment of exploration and evaluation assets                      253,380         70,018 
 
                                                                    (469,680)      (406,276) 
 MOVEMENTS IN WORKING CAPITAL 
 
 (Decrease)/Increase in trade and other payables                      (9,968)        112,417 
 Increase in other receivables                                        (6,943)       (16,651) 
 
 NET CASH USED IN OPERATING ACTIVITIES                              (486,591)      (310,510) 
 
 
 CASH FLOW FROM INVESTING ACTIVITIES 
 
 Additions to exploration and evaluation assets                     (222,259)      (262,869) 
 
 NET CASH USED IN INVESTING ACTIVITIES                              (222,259)      (262,869) 
 
 
 CASH FLOW FROM FINANCING ACTIVITIES 
 
 Proceeds from share issue                                            738,100        729,000 
 Share issue costs                                                   (19,500)        (5,600) 
 
 NET CASH GENERATED FROM FINANCING ACTIVITIES                         718,600        723,400 
 
 
 NET INCREASE IN CASH AND CASH EQUIVALENTS                              9,750        150,021 
 
 Cash and cash equivalents at beginning of the financial year         164,658         17,994 
 
 Effect of foreign exchange rate changes                             (15,932)        (3,357) 
 
 Cash and cash equivalents at end of the financial YEAR               158,476        164,658 
 
 
   1.            ACCOUNTING POLICIES 

The accounting policies and methods of computation followed in these financial statements are consistent with those published in the Group's Annual Report for the year ended 30 June 2021. The financial statements have also been prepared in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB).

The financial information set out below does not constitute the Group's financial statements for the year ended 30 June 2022 or 30 June 2021, but is derived from those accounts. The financial statements for the year ended 30 June 2021 have been delivered to Companies House and those for the year ended 30 June 2022 will be delivered to Companies House shortly

The auditors have reported on the 2022 statements; their report was unqualified and did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006.

   2.            GOING CONCERN 

The Group incurred a loss for the year of GBP716,430 (2021: loss of GBP557,499) after exchange differences on retranslation of foreign operations of GBP22,562 (2021: loss of GBP85,392) at the balance sheet date. The Group had net current liabilities of GBP526,724 (2021:GBP 537,453) at the balance sheet date. These conditions represent material uncertainties that may cast doubt on the Group's ability to continue as a going concern.

The directors have prepared cashflow projections and forecasts for a period of not less than 12 months from the date of this report which indicate that the group will require additional funding for working capital requirements and develop existing projects. As the Group is not revenue or cash generating it relies on raising capital from the public market. Subsequent to year end the Company has raised a total of GBP294,475 from the exercise of warrants. Further details are outlined in Note 10.

As in previous years the Directors have given careful consideration to the appropriateness of the going concern basis in the preparation of the financial statements and believe the going concern basis is appropriate for these financial statements. The financial statements do not include any adjustments that would result if the Group was unable to continue as a going concern.

   3.            LOSS PER SHARE 

Basic loss per share is computed by dividing the loss after taxation for the year available to ordinary shareholders by the weighted average number of ordinary shares in issue and ranking for dividend during the year. Diluted earnings per share is computed by dividing the profit or loss after taxation for the year by the weighted average number of ordinary shares in issue, adjusted for the effect of all dilutive potential ordinary shares that were outstanding during the year.

The following table sets forth the computation for basic and diluted earnings per share (EPS):

 
                                                           2021          2021 
 Numerator                                                  GBP           GBP 
 
 For basic and diluted EPS - loss after taxation      (738,992)     (472,107) 
                                                   ============  ============ 
 
 Denominator                                                No.           No. 
 
 For basic and diluted EPS                          844,141,491   739,571,217 
                                                   ============  ============ 
 
 Basic EPS                                              (0.09p)       (0.06p) 
 Diluted EPS                                            (0.09p)       (0.06p) 
                                                   ============  ============ 
 

The following potential ordinary shares are anti-dilutive and are therefore excluded from the weighted average number of shares for the purposes of the diluted earnings per share:

 
                         No.          No. 
 
 Share options    11,410,000   11,410,000 
                 ===========  =========== 
 
   4.            INTANGIBLE ASSETS 
 
 Exploration and evaluation assets: 
                                              2022          2021 
                                               GBP           GBP 
 Cost: 
 At 1 July                               9,562,528     9,385,051 
 Additions                                 222,259       262,869 
 Exchange gain/(loss)                       21,710      (85,392) 
                                      ------------  ------------ 
 At 30 June                              9,806,497     9,562,528 
                                      ============  ============ 
 
 Impairment: 
 At 1 July                               1,368,496     1,298,478 
 Impairment                                253,380        70,018 
                                      ------------  ------------ 
 At 30 June                              1,621,876     1,368,496 
                                      ============  ============ 
 
 Carrying Value: 
 At 1 July                               8,194,032     8,086,573 
                                      ============  ============ 
 
   At 30 June                            8,184,621     8,194,032 
                                      ============  ============ 
 
 
 Segmental analysis                           2022          2021 
                                               GBP           GBP 
 Botswana                                6,635,686     6,829,604 
 South Africa                            1,548,935     1,364,428 
                                         8,184,621     8,194,032 
                                      ============  ============ 
 

Exploration and evaluation assets relate to expenditure incurred in exploration for diamonds in Botswana and South Africa. The directors are aware that by its nature there is an inherent uncertainty in exploration and evaluation assets and therefore inherent uncertainty in relation to the carrying value of capitalized exploration and evaluation assets.

During the current year, the Group recorded an impairment charge of GBP253,380 on expenditure incurred exploring for new licences in Botswana and South Africa and expenditure incurred on the Ghaghoo diamond mine as the Group was unsuccessful in securing a joint venture partner to complete the acquisition.

On 11 November 2014 the Brightstone block was farmed out to BCL Investments (Proprietary) Limited, a Botswana Company, who assumed responsibility for the work programme. Botswana Diamonds will retain a 15% equity interest in the project.

On 6 February 2017 the Group entered into an Option and Earn-In Agreement with Vutomi Mining Pty Ltd and Razorbill Properties 12 Pty Ltd (collectively known as 'Vutomi'), a private diamond exploration and development firm in South Africa. Pursuant to the terms of the Agreement, Botswana Diamonds earned a 40% equity interest in the project. A separate agreement for funding of exploration resulted in the Company's interest in Vutomi increasing from 40% to 45.94%. On 28 September 2022 the Group increased its' interest from 45.94% to 74%, further information is detailed in Note 10.

The realisation of these intangible assets is dependent on the successful discovery and development of economic diamond resources and the ability of the Group to raise sufficient finance to develop the projects. It is subject to a number of significant potential risks, as set out below.

The Group's exploration activities are subject to a number of significant and potential risks including:

   -      licence obligations; 
   -      exchange rate risks; 
   -      uncertainties over development and operational costs; 

- political and legal risks, including arrangements with governments for licenses, profit sharing and taxation;

- foreign investment risks including increases in taxes, royalties and renegotiation of contracts;

   -      title to assets; 
   -      financial risk management ; 
   -      going concern; and 
   -      operational and environmental risks. 

Included in additions for the year are payments of GBPNil (2021: GBP14,225) of wages and salaries and GBP71,768 (2021: GBP65,553) of directors' remuneration which has been capitalized. This is for time spent directly on the operations rather than on corporate activities.

   5.            PLANT AND EQUIPMENT 
 
                     2022      2021 
                      GBP       GBP 
 At 1 July        206,788         - 
 Additions              -   206,788 
 Exchange gain        852         - 
 
 At 30 June       207,640   206,788 
 
 

On 18 July 2020 the Group entered into an agreement to acquire the KX36 Diamond discovery in Botswana, along with two adjacent Prospecting Licences and a diamond processing plant. These interests are part of a package held by Sekaka Diamond Exploration (Pty) Ltd. The acquisition was completed on 20 November 2020. The diamond processing plant is a recently constructed, fit-for-purpose bulk sampling plant on site. The sampling plant includes crushing, scrubbing, dense media separation circuits and x-ray recovery modules within a secured area.

   6.            CALLED-UP SHARE CAPITAL 
 
  Deferred Shares- nominal value of 0.75p        Number   Share Capital   Share Premium 
                                                                    GBP             GBP 
 At 1 July 2020 and 2021                    239,487,648       1,796,157               - 
 
 At 30 June 2021 and 2022                   239,487,648       1,796,157               - 
 
 
 
 
 Ordinary Shares - nominal value of 0.25p 
 Allotted, called-up and fully paid:              Number   Share Capital   Share Premium 
                                                                     GBP             GBP 
 
 At 1 July 2020                              671,221,902       1,678,055      10,564,712 
 Issued during the year                      121,500,000         303,750         425,250 
 Share issue expenses                                  -               -         (5,600) 
 
 At 30 June 2021                             792,721,902       1,981,805      10,984,362 
 
 
 Issued during the year                       86,350,000         215,875         522,225 
 Share issue expenses                                  -               -        (19,500) 
 
 At 30 June 2022                             879,071,902       2,197,680      11,487,087 
 
 

Movements in share capital

On 25 October 2021, the Company raised GBP550,000 through the issue of 55,000,000 new ordinary shares of 0.25p each at a price of 1.0p per share to provide additional working capital and fund development costs. Each placing share has one warrant attached with the right to subscribe for one new ordinary share at 2.0p per share for a period of three years from 5 November 2021.

On 3 December 2021, a total of 1,683,333 warrants were exercised at a price of 0.60p per warrant for GBP10,100.

On 20 January 2022, a total of 29,666,667 warrants were exercised at a price of 0.60p per warrant for GBP178,000.

   7.            SHARE-BASED PAYMENTS 

The Group issues equity-settled share-based payments to certain directors and individuals who have performed services for the Group. Equity-settled share-based payments are measured at fair value at the date of grant.

Fair value is measured by use of a Black-Scholes valuation model.

The Group plan provides for a grant price equal to the average quoted market price of the ordinary shares on the date of grant.

SHARE OPTIONS

 
                                                  2022                        2021 
                                              Weighted                    Weighted 
                                               average                     average 
                                              exercise                    exercise 
                                30/06/2022    price in     30/06/2021        price 
                                   Options       pence        Options     in pence 
 
 Outstanding at beginning 
  of year                       11,410,000        5.14     11,410,000         5.14 
 Issued                                  -           -              -            - 
 
 Outstanding at end of the 
  year                          11,410,000        5.14     11,410,000         5,14 
 
 Exercisable at end of the 
  year                          11,410,000        5.14     11,410,000         5.14 
 
 

WARRANTS

 
                                                  2022                        2021 
                                30/06/2022    Weighted     30/06/2021     Weighted 
                                  Warrants     average       Warrants      average 
                                              exercise                    exercise 
                                              price in                       price 
                                                 pence                    in pence 
 
 Outstanding at beginning 
  of year                      139,166,667        0.60    105,939,394         0.60 
 Issued                         55,000,000         2.0    110,500,000         0.60 
 Exercised                    (31,350,000)        0.60   (11,000,000)         0.60 
 Expired                                 -           -   (66,272,727)         0.60 
 
 Outstanding at end of the 
  year                         162,816,667        1.07    139,166,667         0.60 
 
 

Refer to note 6 Called up Share Capital for the details of the share options and warrants.

   8.            OTHER RESERVES 
 
                               Share Based Payment Reserve   Translation Reserve   Other Reserves         Total 
                                                       GBP                   GBP              GBP           GBP 
 
 Balance at 30 June 2020                           111,189             (236,662)        (983,287)   (1,108,760) 
 Foreign Exchange Gain/Loss                                             (85,392)                       (85,392) 
                              ----------------------------  --------------------  ---------------  ------------ 
 Balance at 30 June 2021                           111,189             (322,054)        (983,287)   (1,194,152) 
 Foreign Exchange Gain/Loss                                               22,562                         22,562 
                              ----------------------------  --------------------  ---------------  ------------ 
 Balance at 30 June 2022                           111,189             (299,492)        (983,287)   (1,171,590) 
                              ============================  ====================  ===============  ============ 
 
 

Share Based Payment Reserve

The share based payment reserve arises on the grant of share options under the share option plan as detailed in Note 7.

Translation Reserve

The translation reserve arises from the translation of foreign operations.

Other Reserves

During 2010 the Company acquired certain assets and liabilities from African Diamonds plc, a Company under common control. The assets and liabilities acquired were recognised at their book value and no goodwill was recognised on acquisition. The difference between the book value of the assets acquired and the purchase consideration was recognised directly in reserves.

   9.            RETAINED DEFICIT 
 
                                Group                      Company 
                             2022          2021          2022          2021 
                              GBP           GBP           GBP           GBP 
 Opening Balance      (5,704,805)   (5,232,698)   (8,987,016)   (8,554,330) 
 Loss for the year      (738,992)     (472,107)     (656,998)     (432,686) 
                     ------------  ------------  ------------  ------------ 
 Closing Balance      (6,443,797)   (5,704,805)   (9,644,014)   (8,987,016) 
                     ============  ============  ============  ============ 
 
 

Retained Deficit

Retained deficit comprises of losses incurred in the current and prior years.

   10.         POST BALANCE SHEET EVENTS 

On 4 July 2022 the Company announced that pursuant to the receipt of conversion notice from a holder of 1,666,667 warrants exercisable at 0.60 pence each, it had issued 1,666,667 ordinary shares for GBP10,000.

On 20 July 2022 the Company announced the acquisition of an additional stake in the prospective Maibwe joint venture in Botswana.

Details

Siseko Minerals Pty Ltd ("Siseko") increased its stake in the highly prospective Maibwe JV from 29% to 50%. BOD holds a 51.7% stake in Siseko. The consideration payable by Siseko is Pula 411,800 (equivalent to approximately GBP27,215). In addition, Maibwe agreed to pay a royalty to the liquidators of BCL Botswana of 2% from any future commercial development. Maibwe has eleven Prospecting Licenses in the Kalahari of Botswana with several kimberlite pipes; one of which has reported significant quantities of microdiamonds.

The agreement was subject to the following conditions:

   --                 Regulatory (Section 23) approval; 
   --                 Competition Authority approval, if required; 
   --                 Guarantee for the acquisition consideration; 
   --                 Authorisation that the liquidators can enter into such an agreement, and lastly 
   --                 Execution of the Royalty Agreement. 

The completion date is 90-days after the signature date of the agreement.

BOD funded its share of the consideration (amounting to approximately GBP13,600) from existing resources. Maibwe is effectively dormant and in the last financial period for the year ended 31 May 2020 total assets were nil (with all exploration expenditure expensed) and the loss before tax amounted to approximately GBP4,000.

On 8 September 2022 the Company announced that pursuant to the receipt of conversion notices from holders of 47,000,000 warrants exercisable at 0.60 pence each, it had issued 47,000,000 ordinary shares for GBP282,000.

On 28 September 2022 the Company announced that the Vutomi acquisition had completed.

Previously on 29 September 2021 the Board announced that it had exercised its pre-emptive right to acquire the outstanding third-party interests in Vutomi Mining (Proprietary) Limited and Razorbill Properties 12 (Proprietary) Limited (together "Vutomi"). Vutomi holds the mineral rights to the Thorny River Project as well as other exploration assets. The acquisition of Vutomi ("Acquisition") was conditional on, inter alia, customary regulatory and competition authority approvals in South Africa.

The Board announced that the Company had received Section 11 regulatory approval for the transaction in terms of the South African MPRDA all conditions had been satisfied.

As previously announced, the consideration for Vutomi comprises 56,989,330 new ordinary shares of GBP0.0025 each ("Ordinary Shares") in the Company ("Consideration Shares"). There are no lock-in arrangements, but the Consideration Shares will be issued in two equal tranches (three months apart) following Completion. Accordingly, 28,464,665 Consideration Shares ("First Tranche Consideration Shares") have been issued to the vendors of Vutomi.

The Company also agreed that immediately on completion of the Acquisition, the Company would sell 26% of Vutomi for a deferred consideration of US$316,333 to the Company's local South African Empowerment partner, Baroville Trade and Investments 02 Proprietary Limited ("Baroville"), in order to comply with South African

On 6 October 2022 the Company announced that pursuant to the receipt of conversion notice from a holder of 412,545 warrants exercisable at 0.60 pence each, it had issued 412,545 ordinary shares for GBP2,475.

   11.         GENERAL INFORMATION 

The Annual Report and Accounts will be mailed shortly only to those shareholders who have elected to receive it. Otherwise, shareholders will be notified that the Annual Report and Accounts will be available on the website at www.botswanadiamonds.co.uk . Copies of The Annual Report will also be available for collection from the company's registered office at Suite 1, 7th Floor, 50 Broadway, London SW1H 0BL

   12.         ANNUAL GENERAL MEETING 

The Annual General Meeting is due to be held on Thursday 19(th) January 2023 at The Hilton London, Paddington, 146 Praed St, London W2 1EE, United Kingdom at 11.00am. A Notice of the Annual General Meeting is included in the Company's Annual Report.

ENDS

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December 08, 2022 02:00 ET (07:00 GMT)