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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Ortac Res. | LSE:OTC | London | Ordinary Share | VGG6829M1187 | ORDS NPV (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 2.45 | 2.40 | 2.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMOTC
RNS Number : 1033S
Ortac Resources Limited
16 December 2016
Ortac Resources Ltd / Epic: OTC / Market: AIM / Sector: Mining & Exploration
Ortac Resources Ltd / Epic: OTC / Market: AIM / Sector: Mining & Exploration
16 December 2016
ORTAC RESOURCES LIMITED ("ORTAC" OR "THE COMPANY")
Interim Results
Ortac Resources Limited, the AIM listed exploration and development company, is pleased to announce its unaudited financial results for the six months ended 30th September 2016.
Highlights
-- In the DRC, increased initial stake in Casa Mining Ltd ("Casa") to 21.25%; Casa looking to potentially double the 1.2Moz resource at their Misisi Project;
-- Increased stake in Andiamo Exploration Limited ("Andiamo") to 27%; Andiamo expanded their land position in Eritrea and initiated plans for an active 2017 exploration season;
-- Zamsort Limited ("Zamsort") continue to proceed with the construction of their Copper and Cobalt processing plant at Kalaba; the Company at present has an option on 19.35% equity ;
-- In Slovakia, the Company continues to engage with potential local partners and assess developments in the alternate leaching technologies coming to market;
-- Operating losses reduced by 19 % with continued cost reductions;
-- GBP670,000 before costs was raised from two private placements during the reporting period and one subsequent placement post period.
Anthony Balme, Chairman at Ortac commented: "The past six months has seen an improvement in sentiment towards the sector, which is partially reflected in the renewed interest in some of the Company's projects and investments. We remain committed to keeping costs under control and are hopeful that the value in the Company's portfolio of projects and investments will soon be realised in its share price."
The Interim Results are set out in full in the following pages.
For further information, please contact: Ortac Resources Ltd Vassilios Carellas (CEO) +44 (0) 20 7389 9050 SP Angel (Nominated Adviser & Broker) Ewan Leggat/Lindsay Mair +44 (0) 20 3470 0470 Joint Brokers Beaufort Securities Jon Belliss / Elliot Hance +44 (0)20 7382 8300 Peterhouse Corporate Finance Limited +44 (0) 20 7469 0930 Guy Miller www.pcorpfin.com Lucy Williams
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
CHAIRMAN'S STATEMENT
Whilst there is a marked improvement in sentiment towards the natural resource industry from the lows at the start of this year, in particular over the last few weeks for base metals, the gold market has suffered a slight setback which is a little disappointing. This perhaps could all be put down to the "The Trump Effect" and concerns about the rise in US interest rates that could impact precious metals negatively.
Operationally, it can be seen from these interim results that we have managed to trim our cost structures further. In such a frugal environment, we have continued to press ahead where opportunities have presented themselves, taking the view that the market will ultimately see value in the company's flagship project in Slovakia and diversified portfolio of investments in Africa.
In Slovakia, we continue to pursue the validation of our licence through existing and new small scale mining applications. Although the local court has recently revoked an underground mining permit issued to the company by the Central Mining Bureau in 2014, we are confident that between the Mining Bureau and Ministry of Economy, they will be able to reverse this decision in their favour. Meanwhile we continue to engage with potential local partners and continue to assess the alternative gold leaching technologies that are coming to market.
We recently increased our stake in Andiamo to around 27%, with Andiamo now anticipating an active 2017 exploration season subject to the conclusion of its refinancing. Andiamo has recently extended its exploration licence by nearly 100sq km to the south, extending its land holding over the western VMS trend, where some exciting VMS targets have already been identified by the former licence holder, along with a number of historic targets in the Haykota licence that merit further investigation. Andiamo has an JORC Mineral Resource of just under 85,000 near surface gold ounces and 21,000 t of copper at the Yacob Dewar project, and is in an excellent location to the South of the highly successful Bisha mine - which now holds the immediately adjacent licence to the north of the Haykota licence where they recently announced their Ashelli discover. Andiamo remains one of the few independent exploration companies working in this highly prospective territory.'
Over the course of the year, we have gradually increased our stake in CASA Mining Ltd to just under 22%. CASA were originally looking to establish a small gold mining and processing operation, but appear to be now swaying towards expanding the current inferred JORC Mineral Resource of 1.2Moz, where they believe there is scope to potentially more than double this resource. Both these approaches require further investment and it is likely that the source of this investment will ultimately determine the direction in which the project moves forward.
In Zambia, we continue to hold an option over 19.35% of Zamsort Limited, the holder of the Kalaba small-scale mining licence and a highly prospective large scale exploration licence located on the Kabopo Dome, which is also host to First Quantums' Trident Project. Zamsort continue to push ahead with their aim of becoming a producer of Copper and Cobalt from their commercial scale demonstration plant, which is still under construction. Now the rainy season has set in, it is anticipated that commissioning of this plant is targeted during the first half of 2017.
Financial & Corporate Overview
During the period the Company raised GBP370,000 before share issue costs at 0.025 pence per ordinary share. The primary use of proceeds was to increase the Company's shareholding in Casa Mining Limited. On 30 September 2016 the Company had 7,212 million shares outstanding. A further 750 million shares were issued subsequent to 30 September at 0.040 pence per share to generate gross proceeds of GBP300,000.
The Company continues to reduce costs and reduced its Operating Loss for the six months ended 30 September 2016 by 19% to GBP281,000 from GBP346,000 in 2015. Loss per share as at 30 September 2016 was 0.004 pence (2015: 0.11 pence).
During the period the Company reported an unrealised currency gain of GBP897,000 resulting from the depreciation of GBP:Euro
Outlook
Against the backdrop of an improved outlook towards the resource sector, the Company continues to make measured progress with its project in Slovakia and will continue to be rational in its approach to its operations and any further investments. The Company expects that conditions for funding private exploration companies will improve and that the companies that it has invested in during the downturn will be able to raise additional funds at much higher valuations, as recently demonstrated by CASA, to continue the development of their respective projects.
Anthony Balme
Chairman
16 December 2016
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Group Statement of Comprehensive Income for the Interim Period Ended 30 September 2016
Hot Features
Premium
Six Months Six Months
to to
30 September 30 September
Notes 2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Other operating income 15 86
Administrative expenses (292) (432)
Share-based payments (4) -
------------- -------------
Operating loss (281) (346)
Interest received 38 20
Share of Loss of associates 10 (10) (16)
------------- -------------
Loss before tax (253) (342)
Income tax expense - -
Loss for the period from
continuing operations 3 (253) (342)
------------- -------------
Other comprehensive income
Items that may be reclassified
subsequently to profit or
loss:
Currency translation differences - 91
Other comprehensive income
for the period, net of tax (253) (251)
------------- -------------
Total comprehensive income
for the period (253) (251)
------------- -------------
Attributable to:
Owners of the parent (253) (251)
------------- -------------
Loss per share from continuing
and discontinued operations
attributable to the owners
of the parent during the
period
(expressed in pence per
share)
Basic 4 (0.004) (0.11)
Group Statement of Financial Position as at 30 September 2016
As at As at
30 September 30 September
Notes 2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
ASSETS
Non-current assets
Intangible assets 8 13,423 11,761
Property, plant and equipment 9 228 210
Investment in associates 10 914 888
Total non-current assets 14,565 12,859
Current assets
Inventories 38 33
Trade and other receivables 395 897
Available for sale financial
investments 11 1,008 -
Cash & cash equivalents 37 182
Total current assets 1,478 1,112
------------- ------------------------------------------
TOTAL ASSETS 16,043 13,971
------------- ------------------------------------------
LIABILITIES
Current liabilities
Loan from Director 12 (45) -
Trade and other payables (92) (82)
TOTAL LIABILITIES (137) (82)
------------- ------------------------------------------
NET ASSETS 15,906 13,889
------------- ------------------------------------------
SHAREHOLDERS' EQUITY
Share capital 5 - -
Share premium 32,431 31,284
Share based payments reserve 2,324 2,266
Foreign exchange reserve 671 (956)
Retained earnings (19,520) (18,705)
TOTAL EQUITY 15,906 13,889
------------- ------------------------------------------
Group Statement of Changes in Equity for the Interim Period Ended 30 September 2016
Share Share Foreign Share Retained Total
capital premium exchange based earnings equity
reserve payment
reserve
GBP GBP GBP GBP GBP GBP
000's 000's 000's 000's 000's 000's
As at 1 April 2015 - 30,725 (1,043) 2,320 (18,414) 13,588
---------- -------------- ------------- --------- ---------- ---------------
Profit/ (Loss) for
the period - - - - (342) (342)
Items that may be
reclassified subsequently
to profit or loss
Currency translation
differences - - 87 - 87
Other comprehensive
income for the period - - - 51 51
---------- -------------- ------------- --------- ---------- ---------------
Total comprehensive
income for the period - - - (291) (291)
---------- -------------- ------------- --------- ---------- ---------------
Share capital issued - 559 - - - 559
Cost of share issue - - - (54) - (54)
Issue of warrants - - -
Share based payments - - - -
Total transactions
with owners, recognised
directly in equity 559 87 (54) (291) 301
-------------- ------------- --------- ---------- ---------------
As at 30 September
2015 - 31,284 (956) 2,266 (18,705) 13,889
---------- -------------- ------------- --------- ---------- ---------------
As at 1 April 2016 - 32,075 (226) 2,320 (19,267) 14,902
---------- -------------- ------------- --------- ---------- ---------------
Profit/ (Loss) for
the period - - - - (253)
Items that may be
reclassified subsequently
to profit or loss
Currency translation
differences - - 897 - 897
Other comprehensive
income for the period - - -
---------- -------------- ------------- --------- ---------- ---------------
Total comprehensive
income for the period - - - (253) (253)
---------- -------------- ------------- --------- ---------- ---------------
Share capital issued
net of share issue
costs - 356 - - - 356
Share based payments - - - 4 - 4
Total transactions
with owners, recognised
directly in equity - 356 897 4 (253) 1,004
---------- -------------- ------------- --------- ---------- ---------------
As at 30 September
2016 - 32,431 671 2,324 (19,520) 15,906
---------- -------------- ------------- --------- ---------- ---------------
Group Cash Flow Statement for the Interim Period Ended 30 September 2016
Six Months Six Months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Cash flows from operating
activities
(Loss) before tax (253) (342)
Finance income (38) (20)
Share of loss from associates 10 16
Share based payments 4 -
Exchange differences - (28)
Depreciation 7 7
Operating loss before changes
in working capital (270) (367)
------------- -------------
Decrease in inventories - (4)
(Increase)/decrease in trade
and other receivables 7 (464)
(Decrease)/increase in trade
and other payables (70) (105)
Net cash used in operating
activities (333) (940)
------------- -------------
Cash flows used in investing
activities
Interest received 38 20
(Disposal)/purchases of
intangibles (17) 45
Purchases of property, plant
and equipment - -
Investment in available
for sale financial investments (79) -
Net cash used in investing
activities (58) 65
------------- -------------
Cash flows from financing
activities
Proceeds from issue of ordinary
shares net of share issue
costs and subscriptions
receivable - 559
Net cash inflow from financing
activities - 559
------------- -------------
Net decrease in cash and
cash equivalents (391) (316)
Cash and cash equivalents
at beginning of period 428 498
Cash and cash equivalents
at end of period 37 182
------------- -------------
NOTES TO THE INTERIM REPORT FOR SIX MONTHSED 30 SEPTEMBER 2016
1. Basis of preparation
The condensed consolidated interim financial statements has been prepared under the historical cost convention and on a going concern basis and in accordance with International Financial Reporting Standards and IFRIC interpretations adopted for use in the European Union ("IFRS") and those parts of the BVI Business Companies Act applicable to companies reporting under IFRS.
The condensed consolidated interim financial statements contained in this document do not constitute statutory accounts. In the opinion of the directors, the condensed consolidated interim financial statements for this period fairly presents the financial position, result of operations and cash flows for this period.
The Board of Directors approved this Interim Financial Report on 07 December 2016
Statement of compliance
The condensed consolidated interim financial statements have been prepared in accordance with the requirements of the AIM Rules for Companies. As permitted, the Company has chosen not to adopt IAS 34 "Interim Financial Statements" in preparing these interim condensed consolidated interim financial statements. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 March 2016, which have been prepared in accordance with IFRS as adopted by the European Union.
Accounting policies
The condensed consolidated interim financial statements for the period ended 30 September 2016 have not been audited or reviewed in accordance with the International Standard on Review Engagements 2410 issued by the Auditing Practices Board. The figures were prepared using applicable accounting policies and practices consistent with those adopted in the statutory annual financial statements for the year ended 31 March 2016.
Associates
Associates are entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognised at cost and the carrying amount is increased or decreased to recognise the investor's share of the profit or loss of the investee after the date of acquisition. The Group's investment in associates includes any goodwill identified on acquisition.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.
The Group's share of post-acquisition profit or loss is recognised in the statement of comprehensive income, and its share of post-acquisition movements in other comprehensive income is recognised in the other comprehensive income section of the statement of comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group's share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.
The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amounts of the associate and its carrying value and recognises the amount adjacent to 'share of profit/ (loss) of associates' in the statement of comprehensive income.
Gains and losses resulting from upstream and downstream transactions between the group and its associates are recognised in the Group's financial statements only to the extent of unrelated investor's interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.
Dilution gains and losses arising in investments in associates are recognised in the statement of comprehensive income.
2. Financial risk management and financial instruments
Risks and uncertainties
The Board continually assesses and monitors the key risks of the business. The key risks that could affect the Group's medium term performance and the factors that mitigate those risks have not substantially changed from those set out in the Group's 2016 Annual Report and Financial Statements, a copy of which is available from the Group's website: www.ortacresources.com. The key financial risks are market risk (including currency risk), credit risk and liquidity.
3. Segmental analysis
Segment information has been determined based on the information reviewed by the Board, being the Group's chief operating decision-maker, for the purposes of allocating resources and assessing performance. No revenue is currently being generated.
There are no transactions occurring during the year, or comparative year, between reportable segments, that affect the Income Statement. Head office activities are mainly administrative in nature and are located in the UK/BVI, whilst the activities in Slovakia relate to exploration and evaluation work.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
By geographical area UK/BVI Slovakia Eritrea Zambia/DRC Total
Six Months to 30 September
2016 GBP 000's GBP 000's GBP 000's GBP 000's(1) GBP 000's
Result
Operating loss (257) (24) - (281)
Finance income 38 - - - 38
Share of Loss of associates - - (10) - (10)
----------------------------- ---------- ---------- ---------- ------------- ----------
Loss before & after
taxation (219) (24) (10) - (253)
---------- ---------- ---------- ------------- ----------
Other information
Depreciation 7 - - - 7
Investment in associate - - - - -
Capital additions - - - - -
Assets
Non-current assets - 13,651 914 - 14,565
Current assets less
cash and cash equivalents 314 64 - 1,100 1478
Cash and cash equivalents 33 4 - - 37
Consolidated total
assets 347 13,719 914 1,100 13,176
---------- ---------- ---------- ------------- ----------
(1) Zambia - 883;
Democratic Republic
of Congo - 217
Liabilities
Non-current liabilities - - - - -
Current liabilities (89) (48) - - (137)
Consolidated total
liabilities (89) (48) - - (137)
---------- ---------- ---------- ------------- ----------
By geographical area UK/BVI Slovakia Eritrea Zambia Total
Six Months to 30 September
2015 GBP 000's GBP 000's GBP 000's GBP 000's GBP 000's
Result
Operating loss (268) (78) - (346)
Finance income 20 - - - 20
Share of (Loss) of
associates - - (16) - (16)
Loss before & after
taxation (248) (78) (16) - (342)
---------- ---------- ---------- ---------- ----------
Other information
Depreciation 4 3 - - 7
Investment in associate - - - - -
Capital additions (45) - - - (45)
Assets
Non-current assets 7 11,964 888 - 12,859
Current assets less
cash and cash equivalents 47 72 - 811 930
Cash and cash equivalents 178 4 - - 182
Consolidated total
assets 232 12,040 888 811 13,971
---------- ---------- ---------- ---------- ----------
Liabilities
Non-current liabilities - - - - -
Current liabilities (52) (30) - - (82)
Consolidated total
liabilities (52) (30) - - (82)
---------- ---------- ---------- ---------- ----------
4. Loss per share
The calculation of earnings per share is based on the loss attributable to equity holders divided by the weighted average number of share in issue during the period:
Six Months Six Months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Net loss after taxation (253) (342)
Weighted average number
of ordinary shares used
in calculating basic
loss per share (millions) 5,764 3,179
Basic & diluted loss
per share (expressed
in pence) (0.004) (0.11)
------------- -------------
As the inclusion of the share options would result in a decrease in the earnings per share, they are considered to be anti-dilutive, and as such, a diluted loss per share is not included.
5. Share capital
The authorised share capital of the Company and the called up and fully paid amounts at 30 September 2016 were as follows:
A) Authorised GBP 000's
Unlimited Ordinary shares
of no par value -
B) Called up, allotted,
issued and fully paid Number of shares Nominal value
--------------------------- ---------------------------------------- --------------------------------------
As at 1 April 2016 5,732,211,373 -
Additions:
26 September 2016 at
.025p 800,000,000
27 September 2016 at
.025p 680,000,000 -
As at 30 September 2016 7,212,211,373 -
---------------------------------------- --------------------------------------
6. Share based payments
Movements on the number of share options and their exercise price during the period ended 30 September 2016 are as follows:
Weighted Weighted
Average Average
Exercise Exercise
Price 6 months to Price Year to
30 September 30 March
2016 2016
(Unaudited) (Audited)
Pence No of Options Pence No of Options
1 April 2016 0.94 279,300,000 0.94 279,300,000
Cancelled - -
Modified - - - -
Lapsed - - - -
Granted .05 135,000,000 - -
30 September
2016 0.65 414,300,000 0.94 279,300,000
-------------- --------------
The parameters used to ascertain the fair value of $4,000 of share options issued during the period are:
Volatility -35%
Risk-free Interest Rate - 2%
Expected Exercise Period 3 years
Share Warrants
No warrants were granted during the period ended 30 September 2016. There are no warrants on issue; the details concerning warrants which have expired can be found in the audited financial statements for the year ended 31 March 2016.
7. Investment in group companies
At 30 September 2016, the Group held 100% of the share capital of the following wholly owned subsidiary companies:
Company Country of Proportion Nature of business
Registration held
Ortac Resources England and 100% Holding Company
(UK) Limited Wales
St. Stephans Slovak Republic 100% Mineral Exploration
Gold s.r.o.*
Carpathian Soviet Republic 100% Mineral Exploration
Minerals s.r.o.*
Ortac s.r.o.* Slovak Republic 100% Mineral Exploration
* Wholly owned subsidiary of Ortac Resources (UK)
Limited
During the period the Company incorporated Carpathian
Minerals s.r.o. to apply for minerals licences
in the Slovak Republic. It is wholly-owned by Ortac
Resources (UK) Limited.
8. Intangible assets
Six Months Six Months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Balance brought forward 12,516 11,688
Additions - (45)
Currency translation
adjustments 907 118
Amortisation - -
Balance carried forward 13,423 11,761
Net book value 13,423 11,761
------------- -------------
The net book value is
analysed as follows:
Deferred exploration
expenditure
-Exploration and development
costs- Slovakia 13,254 11,491
-Goodwill - Slovakia 169 270
13,423 11,761
------------- -------------
9. Tangible assets
Six Months Six Months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Cost
Beginning of the period 355 319
Currency translation
adjustment 27 5
End of the period 382 324
Depreciation
Beginning of the period (139) (104)
Currency translation
adjustment (6) (3)
Charge for the period - (7)
End of the period (145) (114)
Net book value at beginning
of period 227 215
------------- -------------
Net book value at end
of period 210 210
------------- -------------
10. Investment in associates
As previously reported, on the 20 April 2014, Ortac Resources Limited increased its investment in Andiamo Exploration Limited (a private UK- registered company) from 18.47% to 25.37%, which resulted in the investment being reclassified to an associated company from an available for sale financial asset. During the period ended 30 September 2016 the Company increased its interest to 26.99%. In September 2016 Andiamo entered into an agreement with its joint venture partner Environminerals East Africa Ltd ("EEA") to acquire the EEA joint venture interest earned over a part of the Andiamo licence in exchange for 25% of the issued share capital of Andiamo. This transaction has not yet completed as of the date of the approval of these interim accounts but when closed the interest of the Company in Andiamo would be reduced to 20.24%
The carrying value of Andiamo is GBP914,000 determined as follows:
Six months Six months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
------------------------- ------------- -------------
Beginning of the period 874 904
Purchase of shares 50 -
Share of (loss) from
associate (10) (16)
------------- -------------
End of the period 914 888
------------- -------------
Ortac's share of the results of Andiamo Exploration Limited are shown below:
Six months Six months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
--------------- ------------- -------------
Revenues - -
------------- -------------
Share of loss (10) (16)
------------- -------------
Nature of investments in associates:
Name of Place of % of ownership Nature Measurement
entity business/country interest of the method
of incorporation relationship
------------- ------------------ --------------- -------------- ------------
Andiamo England 26.99% Strategic Equity
Exploration partnership
Limited
The latest available financial statements for Andiamo Exploration Limited (December 2015) were included with the audited accounts at 31 March 2016. There are no interim statements available since that date. During the year ended 31 December 2015 Andiamo lost approximately US$200,000 and at 31 December 2015 Andiamo had net assets of US$10,888,000. Ortac's interest in the loss and net assets was approximately US$54,000 and US$ 2,940,000 respectively. The Directors believe that at 30 September 2016 the fair value of the Group's interest in Andiamo Exploration Limited is equal to or greater than its carrying value.
Andiamo Exploration Limited is a private company and there is no quoted market price available for its shares.
11. Available for sale financial assets
Six Months Six Months
to to
30 September 30 September
2016 2015
(Unaudited) (Unaudited)
GBP 000's GBP 000's
Beginning of the period 835 -
Additions 173 -
Disposals - -
Loss on disposals - -
Reclassification to - -
investment in associates
------------- -------------
End of the period 1,008 -
------------- -------------
The available for sale financial assets include:
(i) the Company's investment in Casa Mining Limited of GBP217,000. During the period the Company increased its shareholding from 12% to 19.63%. Subsequent to 30 September 2016 the Company purchased additional shares in Casa which increased its shareholding to 21.25% and in future accounts Casa will be accounted for as an associated company.
and
(ii) the Company's Secured Loan to Zamsort Limited of GBP791,000 described below.
September
2016 2015
Secured Loan,
8% secured convertible loan
note, Principal only 791 791
On 30 March 2015, Ortac Resources Limited announced that it had entered into a US $600,000 (GBP405,405) 8% Secured Convertible Loan Note (the "Convertible Loan") and a one note for one share Call Option Agreement (the "Option") with Zamsort, a private company registered in Zambia that holds a prospective Cu-Co mining and exploration licence in the Zambian Copper Belt.
As at 31 March 2015, Ortac Resources Limited had advanced US$ 450,000 (GBP304,000) to Zamsort as a first instalment of this loan, with the balance of US$ 150,000 following due diligence, paid on 9 April 2015.
On 25 August 2015 the Company exercised its Option to purchase a further US$ 600,000 of the Convertible Loan and now has a total investment of US$ 1,200,000 convertible into 19.35% of Zamsort. The Convertible Loan is carried at its original cost of GBP791,000. Interest of GBP 92,000 (2015 - GBP 20,000) is included with Trade and other receivables.
The loan notes are convertible at any time prior to the redemption date.
12. Loan from Director
In September 2016 a Company associated with a Director made a short term loan of GBP40,983 (US$51,400) to enable the Company to complete a purchase of Casa shares.
In October upon completion of two share placements the Company repaid the loan together with a service fee of GBP 4,098.
13. Contingent liability
As part of its acquisition of Kremnica Gold s.r.o. and Kremnica Gold Mining s.r.o., Ortac Resources (UK) Limited (formerly Ortac Resources plc) agreed to pay:
a) Vendor royalties of up to US$3,750,000 in either shares or cash - being $15 per ounce on the first 250,000 ounces of gold equivalent (gold plus silver) resource defined as proven and probable reserve in the bankable feasibility study. Said royalty will become payable within 60 days of all required permits being obtained to allow commercial production at the Kremnica property; and
b) A 2 per cent Net Smelter Royalty ("NSR") on gold and silver production from the Kremnica Gold Project to a limit of the first 1,000,000 ounces produced, reduced to a 1 per cent NSR on the next 1,000,000 ounces and zero per cent thereafter. At any time prior to the reduction of the NSR percentage to 1 per cent, Ortac may acquire half of the 2 per cent NSR for US$1,000,000. After the reduction of the NSR to 1 per cent, the Purchaser may acquire all of the Vendor NSR for US$1,000,000.
On the basis of a third party resource study, updated in 2013, the Directors are confident that proven and probable reserves will significantly exceed 250,000 ounces of gold equivalent (gold) resource. Notwithstanding this, until such time as it is clear that all the required permits to achieve commercial production will be secured, no provision for such amounts can be included in the Group financial statements.
14. Post balance sheet events
(1) In October 2016, the Company increased its interest in Casa Mining Limited to 21.25%. It issued 251,296,486 shares to a Director with a stated value of GBP 81,672 (.0325 pence per share) to acquire 124,722 Casa shares and also subscribed for an additional 62,500 shares offered by Casa at a cost of US$ 50,000. Since these transactions have increased its shareholding to 21.25%, in future the Company will account for Casa Mining Limited as an associated company;
(2) In October 2016 the Company announced that it had placed 750,000,000 shares at .04 pence and raised GBP300,000 before share issue costs. The Company now has 8,213 million shares on issue.
15. Other matters
The condensed consolidated interim financial statements set out above do not constitute the Group's statutory accounts for the period ended 30 September 2016 or for earlier periods, but is derived from those accounts where applicable.
A copy of this interim statement is available on the Ortac's website: www.ortacresources.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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(END) Dow Jones Newswires
December 16, 2016 07:31 ET (12:31 GMT)
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