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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Bluejay Mining Plc | LSE:JAY | London | Ordinary Share | GB00BFD3VF20 | ORD 0.01P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.005 | 1.89% | 0.27 | 0.26 | 0.28 | 0.27 | 0.265 | 0.265 | 1,915,301 | 13:36:02 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Metal Mining Services | 0 | 1.67M | 0.0014 | 1.93 | 3.23M |
From Apr 2019 to Apr 2024
TIDMJAY
RNS Number : 7587P
Bluejay Mining PLC
31 May 2018
Bluejay Mining plc / EPIC: JAY / Market: AIM / Sector: Mining
31 May 2018
Bluejay Mining plc ('Bluejay' or the 'Company')
Final Results and Notice of AGM
Bluejay Mining plc, the AIM and FSE listed company with projects in Greenland and Finland, is pleased to announce its final results for the year ended 31 December 2017. The Company also gives notice that its Annual General Meeting ('AGM') will be held on 28 June 2018 at 1:00 p.m. at The Washington Mayfair Hotel, 5 Curzon Street, London, W1J 5HE. Copies of the Notice of AGM, together with the Form of Proxy and Annual Report have been posted to shareholders and will be available to view on the Company's website.
Highlights
-- Due to commence production at the world's highest-grade ilmenite project in 2019
-- Post-period-end delivered a 400% JORC resource increase for the Dundas Ilmenite Project ("Dundas" or the "Project"), defining 96 million tonnes at 6.9% ilmenite in-situ and a further exploration target of between 20-60 million tonnes at between 6% and 10% ilmenite
-- Significant further upside remains - particularly at Iterlak, which was the surprise discovery of 2017 and has the potential to surpass deposit discoveries to-date
-- Opportunity to upgrade the already high in-situ ilmenite grade by up to 30% via a simple oversize separation, further enhancing run of mine (ROM) grade and project economics
-- Simple and streamlined processing means the Project is expected to be in the lowest quartile of ilmenite production costs globally
-- Strategic Greenland location enables product to be sold to both European and North American markets
-- Finalising offtake discussions with a bulk sample to be taken in coming 2018 field season to supply final product parcels to customers
-- Preliminary Feasibility Study ("PFS") due in the coming months, which will then feed into the final feasibility report that is due to be completed later this year
-- Exploitation licence application is due for lodgement in the coming months, with final approval expected this year
-- Strong government support - awarded "Prospector and Developer of the Year 2017" by the Government of Greenland in March 2018
-- Significant further upside available from the Disko Nickel, Copper, Cobalt & Platinum Project in West Greenland, which has geological similarities to the world's largest nickel/copper sulphide mine, Norilsk-Talnakh
-- As a result of strong 2017 exploration results have significantly increased licence size and focus is now on refining drill targets
-- Current cash position of >GBP15m - bolstered following a GBP17m placing in February 2018
Chairman's Statement
Bluejay's change of financial year end meant that this is my first opportunity to comment as Chairman and I am delighted to be able to present these results at such an exciting time in our development.
Bluejay is set to bring into production the world's highest-grade ilmenite project in 2019, being the Dundas Ilmenite Project ('Dundas' or 'the Project') in north-west Greenland. Not only does this Project distinguish itself by grade, scale, legal jurisdiction; and strategic location It looks set to be in the lowest quartile for production costs, making it commercially very attractive. Having acquired an initial majority stake in the Project in December 2015, this has undoubtedly been a rapid rate of development, which is a testament to the commitment and skill set of our team along with the quality of our Project. With multiple value triggers due in the coming year, we remain committed to maintaining this pace of progress to realise production and deliver revenues for our shareholders in the near term.
We have strong confidence that, our product will be highly sought after thanks to a number of key attributes. First being the grade and size of the deposit. Post-period-end in April 2018 we delivered a 400% increase in the Project's resource, defining 96 million tonnes at 6.9% ilmenite in-situ and a further exploration target of between 20-60 million tonnes at between 6% and 10% ilmenite. Of this, an Indicated Mineral Resource equal to 81 million tonnes at 6.1% ilmenite in-situ was defined at Moriusaq, which was the target area where the incumbent resource had been identified the year before, in April 2017. These results matched our internal expectations of size and grade for the Moriusaq target area, marking a great success. What we did not expect, from both the 2017 field work and the resultant resource upgrade, was the discovery of Iterlak. This deposit appears to host mineralisation of a similar size to Moriusaq but with much higher grades; initial sampling in 2017 of the active beaches here showed extensive areas of up to 80% ilmenite in-situ. This is incredibly significant, given that with Moriusaq alone we have already proven Dundas to be the world's highest-grade ilmenite deposit; with Iterlak, we have the potential to surpass this record, and our own expectations, highlighting just how exceptional our Project is and the further upside opportunity.
The second defining factor that makes our Project attractive to end-users is the relatively simple and streamlined processing required. To refer to Dundas as a "mining" play is arguably not representative of the methods that will be employed to extract the high-grade ilmenite. Given that mineralisation is visible to the naked eye, only a very simple extraction and processing method will be required, which aside from the positive cost implications, ensures low environmental impact. Furthermore, the resource is chemically homogenous with low impurities, which means that wet gravity and dry magnetic circuits can produce two homogeneous and consistent grade ilmenite ores suitable for sulphate pigment as well as for sulphate and chloride slag, giving it multi-market application - something which we confirmed through the production of a bulk sample in 2017. We have also identified an opportunity to upgrade the already high in-situ ilmenite grade by up to 30% via a simple oversize separation step prior to processing, further enhancing run of mine ('ROM') grade and project economics. It is thanks to this simple processing method that we believe our Project will be in the lowest quartile of production costs, further adding to its commercial value and appeal.
Another aspect that will positively impact production costs is our location. Greenland is located such that it provides us with an ability to sell to both European and North American markets, both of which show strong demand for ilmenite. This accessible and strategic location means Bluejay's ilmenite is set to be much cheaper to ship than the majority of current ilmenite producers which are based in Africa, giving us significant competitive advantage.
In support of securing an offtake partner, in September 2017 ROM, heavy mineral concentrates, standard ilmenite and premium ilmenite samples and specifications were shipped to prospective customers. Since then we have increased our resource size and grade even further and our focus is now on securing final commercial agreements. To this end, we are engaged in a number of positive discussions and another bulk sample will be taken from the active beaches at Moriusaq in 2018, where the current resource has been defined to supply final product parcels to customers.
The results of feasibility work currently underway will also be valuable in supporting these discussions as they will give a clearer indication of the Project's economics. The results of the preliminary feasibility study are due in the coming months, which will then feed into the final feasibility report that is due to be completed later this year. We have appointed a number of leading mining consultants to undertake these studies for us, including SRK Consulting ('SRK'), who will prepare the mining schedule and assess water management aspects as well as review the study as a whole; IHC Robbins who will complete the process plant engineering & design study; Royal IHC who will finalise a dredging study, and; Amec Foster Wheeler Americas Ltd who will undertake the infrastructure and services elements.
Aside from project economics, the final feasibility report will also form a part of the exploitation licence application that is due for lodgement with the Government of Greenland ('Government') in the coming months and which is expected to be approved this year. As part of this licencing application we have already successfully finalised the "Terms of Reference" for both the Environmental Impact Assessment ('EIA') and Social Impact Assessment ('SIA') and completed a White Paper, which encompasses the stakeholder consultation response period. I am pleased to report that we have had all documents accepted and approved by the Greenland Government and the relevant licencing bodies so far, along with a high degree of support from the local community. We enjoy a positive working relationship with and strong support from the Government of Greenland - as evidenced by our award of "Prospector and Developer of the Year 2017" by the Government of Greenland in March 2018 - and we look forward to continuing to work closely with them and all of the relevant national and local authorities as we finalise our licencing applications.
The Government has defined a new five year 'Mineral and Oil Strategy 2018', which feeds into a long-standing target of opening five large scale mines in the near term, with the first opening last year and now producing gemstones, and Bluejay vying to be the next off the block.
With additional bulk sampling for offtake as well as various civil and site works anticipated to be completed during 2018 we anticipate the completion of the various studies currently underway to allow for an exploitation licence to be lodged at the end of this field season. We continue to focus on the commencement of mining during 2019, which after just three years since the Project was acquired will be a fantastic achievement.
We intend to focus on the active and raised beach targets first, where we have defined the current resource and exploration target which alone has demonstrated ability to support a large and long-life mining operation. Further expansion potential exists both onshore and offshore, with an assessment of the shallow marine area due to be undertaken by SRK to evaluate the additional resources available in this environment. This will form part of our 2018 field work season commencing in July 2018. Much of this field work will focus on the Iterlak Delta and surrounding area, with drilling, resource definition, and marine bathymetric surveys to be undertaken to help build upon the area's 20-60Mt exploration target. We are confident that significant potential exists here and believe that the Iterlak Delta, at 2.65 million sq m, is a primary sediment (and thus ilmenite) source for the broader licence area. The entire sediment package comprising the delta has been estimated at 78-145Mt.
Alongside Dundas, the Company is simultaneously advancing the Disko Nickel, Copper, Cobalt & Platinum Project in West Greenland ('Disko'), which is of significant interest due to its geological similarities to Norilsk-Talnakh, the world's largest nickel/copper sulphide mine in northern Russia ("Norilsk"). Both Disko and Norilsk contain nickel-copper-cobalt-platinum rich Magmatic Massive Sulphides ('MMS'), with one 28-tonne boulder recovered from Disko being so significant that it is now displayed in the foyer of the Danish Geological Museum in Copenhagen. Exploration at this asset is still early stage, but results received from the 2017 field programme are overwhelmingly positive.
In Area 1 - The Kugg Project, located on the southern peninsular.
Surface sampling confirmed a working sulphide system with initial chemical assays in oxidised surface material returning 2.02% nickel, 0.8% copper and 0.2% cobalt. Alongside this, handheld XRF sampling on fresh, polished material returned values averaging between 4.6%-9.3% nickel and 1.5-2.8% copper, whilst a Moving Loop, High Powered Electro-Magnetic survey tested a number of low resistivity targets that had been identified by previous licensee holders.
In Area 2 - The Illug Project, located on the northern peninsular.
Data compilation and interpretation has identified numerous prospective targets and confirmed the presence of historically identified anomalies. These results are very encouraging and are being used to structure our 2018 work programme, which is focussed on developing drill targets. To support our exploration efforts, we have several parties interested in partnering with us and we will carefully evaluate these to determine the best way forward. Thankfully, due to the project's relatively close proximity to Dundas, we are able to undertake work at both projects cost-effectively.
As a result of the strong results we have received to date and our understanding of Disko and its potential, in May 2018 we acquired an additional 1,616km(2) to increase the project's licence size to 2,586km(2) . To put this into perspective, this now means the Disko project area is approximately the same size as Luxembourg. We believe this asset's scale and potential is yet to be reflected in our share price and accordingly believe Disko provides us with significant upside potential.
Looking at our wider portfolio, we continue to hold the Kangerluarsuk SedEx:
Lead-Zinc-Silver Project in Greenland ('Kangerluarsuk') and three high-grade, multi-element base metal deposits in southern Finland. We believe Kangerluarsuk offers a good development opportunity in the future. In Finland, our assets are cost sustainable for the long term whilst we assess the best ways in which to realise value. To help us best determine this, a low cost work programme has been put in place for the Outokumpu licence areas, which will include diamond drilling and ground geophysical surveys. The main objective of this work programme to target the "Kuusjärvi depression zone", which is a 6km long section of the Outokumpu belt. Work will be conducted in two stages, with the first consisting of approximately 1,800m of drilling and ground geophysical surveys that will last approximately 2-3 months, whilst stage 2 will consist of approximately 2,000m of drilling and DHEM surveys, again lasting 2-3 months.
Financial Review
The loss before taxation of the Group for the 18-month period ended 31 December 2017 amounted to GBP2,680,708 (12 months to 30 June 2016: GBP620,059).
The Group's cash position at 31 December 2017 was GBP2,901,922 (30 June 2016: GBP425,046).
In February 2018 the group raised GBP17m by issuing 77,272,728 new ordinary shares of 0.01 pence at a price of 22 pence per share. The funds raised is to primarily support the rapid advancement of the Dundas project and fast track into production and commercialisation. This will include completing an Environmental Impact Assessment and Social Impact Assessment, commencing procurement of long lead items to support mine plant construction and supporting infrastructure, finalising the pre-feasibility study, completing the exploitation application and lodgement and facilitating the offtake as well as other general activities. Additionally, the raise will help fund the 2018 work programme at Disko and other interests in the wider project portfolio.
Outlook
We have a world class asset with numerous advantages. We anticipate meaningful news flow as we get closer to exploitation licence approval and production at Dundas., Alongside this, our Disko project offers significant upside that could further transform the value of our Company. Indeed, I believe we are in an incredibly strong position to have not one but two incredible assets. Our focus is to commence mining at Dundas in 2019 and establish Bluejay as a highly profitable production company whilst unlocking the value potential of Disko.
To be in the position we are today, is the result of a great deal of hard work and skill shown, by all our employees, consultants and partners. Their experience and focus has and is contributing to Bluejay creating a world class portfolio which has positioned us for strong, long-term growth. I would like to thank our shareholders for their long-term support, we are lucky to have a strong and supportive base of investors and we hope that the coming months and years will continue to be value accretive for all our stakeholders.
FINANCIAL RESULTS
STATEMENTS OF FINANCIAL POSITION
As at 31 December 2017
Hot Features
Premium
Group Company
-------------------------- ----------------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
Note GBP GBP GBP GBP
----------------------------- ----- ------------ ------------ ------------- -------------
Non-Current Assets
Property, plant and
equipment 6 631,054 16,883 8,333 4,577
Intangible assets 7 17,971,795 12,627,680 - -
Investment in subsidiaries 8 - - 19,717,873 13,505,274
18,602,849 12,644,563 19,726,206 13,509,851
----------------------------- ----- ------------ ------------ ------------- -------------
Current Assets
Trade and other receivables 9 642,870 175,685 620,891 111,176
Cash and cash equivalents 10 2,901,922 425,046 2,820,884 371,485
----------------------------- ----- ------------ ------------ ------------- -------------
3,544,792 600,731 3,441,775 482,661
----------------------------- ----- ------------ ------------ ------------- -------------
Total Assets 22,147,641 13,245,294 23,167,981 13,992,512
----------------------------- ----- ------------ ------------ ------------- -------------
Non-Current Liabilities
Deferred Tax Liabilities 12 496,045 373,343 - -
----------------------------- ----- ------------ ------------ ------------- -------------
496,045 373,343 - -
Current Liabilities
Trade and other payables 11 564,471 392,754 358,306 368,403
Total Liabilities 1,060,516 766,097 358,306 368,403
----------------------------- ----- ------------ ------------ ------------- -------------
Net Assets 21,087,125 12,479,197 22,809,675 13,624,109
----------------------------- ----- ------------ ------------ ------------- -------------
Equity attributable
to owners of the
Parent
Share capital 13 5,967,268 5,938,572 5,967,268 5,938,572
Share premium 13 27,220,576 16,183,675 27,220,576 16,183,675
Deferred shares 1,825,104 1,825,104 1,825,104 1,825,104
Reverse acquisition
reserve (8,071,001) (8,071,001) - -
Other reserves 15 1,121,097 470,700 312,045 355,809
Retained losses (6,975,919) (4,458,414) (12,515,318) (10,679,051) ----------------------------- ----- ------------ ------------ ------------- ------------- Total equity attributable to owners of the Parent 21,087,125 11,888,636 22,809,675 13,624,109 ----------------------------- ----- ------------ ------------ ------------- ------------- Non-controlling interest - 590,561 - - ----------------------------- ----- ------------ ------------ ------------- ------------- Total Equity 21,087,125 12,479,197 22,809,675 13,624,109 ----------------------------- ----- ------------ ------------ ------------- -------------
The Company has elected to take the exemption under Section 408 of the Companies Act 2006 from presenting the Parent Company Income Statement and Statement of Comprehensive Income. The loss for the Company for the period ended 31 December 2017 was GBP1,999,470 (year ended 30 June 2016: GBP10,247).
The Financial Statements were approved and authorised for issue by the Board of Directors on 30 May 2018 and were signed on its behalf by:
Greg Kuenzel
Director
CONSOLIDATED INCOME STATEMENT
For the period ended 31 December 2017
Period ended Year ended
31 December 30 June
2017 2016
Continued operations Note GBP GBP
--------------------------------------------------- ----- ------------- -----------
Revenue - -
Cost of sales - -
--------------------------------------------------- ----- ------------- -----------
Gross profit - -
Administrative expenses 21 (2,111,312) (629,046)
Foreign exchange 70,953 8,737
Operating Loss (2,040,359) (620,309)
Impairments 7 (643,168) -
Finance income 18 1,717 250
Other income 1,102 -
Loss before Income Tax (2,680,708) (620,059)
Income tax expense 19 - -
--------------------------------------------------- ----- ------------- -----------
Loss for the Period (2,680,708) (620,059)
--------------------------------------------------- ----- ------------- -----------
Loss attributable to
* Owners of the Parent (2,680,708) (613,849)
* Non-Controlling interests - (6,210)
--------------------------------------------------- ----- ------------- -----------
Loss for the Period (2,680,708) (620,059)
--------------------------------------------------- ----- ------------- -----------
Basic and Diluted Earnings Per Share attributable
to owners of the parent during the period (0.408) (0.172)
(expressed in pence per share) 20 p p
--------------------------------------------------- ----- ------------- -----------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the period ended 31 December 2017
Period ended Year ended
31 December 30 June
2017 2016
GBP GBP
-------------------------------------------------------- ------------- -----------
Loss for the period (2,680,708) (620,059)
Other Comprehensive Income:
Items that may be subsequently reclassified
to profit or loss
Currency translation differences 694,161 1,487,405
--------------------------------------------------------- ------------- -----------
Other comprehensive income for the period, net
of tax (1,986,547) 867,346
--------------------------------------------------------- ------------- -----------
Total Comprehensive Income for the Period Attributable
to
-------------------------------------------------------- ------------- -----------
* Owners of the Parent (1,986,547) 873,556
* Non-Controlling interests - (6,210)
--------------------------------------------------------- ------------- -----------
Total Comprehensive Income (1,986,547) 867,346
--------------------------------------------------------- ------------- -----------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period ended 31 December 2017
Attributable to owners of the Parent
-----------------------------------------------------------------------------------------------
Share Share Deferred Other Retained Non-controlling Total
capital premium shares reserves losses Total interest equity
Note GBP GBP GBP GBP GBP GBP GBP GBP
---------- ---------------- ------------
Balance as
at 1 July 2015 5,919,731 14,274,528 1,825,104 (9,045,505) (3,916,223) 9,057,635 - 9,057,635
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Loss for the
period - - - - (613,849) (613,849) (6,210) (620,059)
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Other
comprehensive
income for
the period
Items that
may be
subsequently
reclassified
to profit or
loss
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Currency
translation
differences - - - 1,487,405 - 1,487,405 - 1,487,405
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Total
comprehensive
income for
the period - - - 1,487,405 (613,849) 873,556 (6,210) 867,346
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Proceeds from
share issues 13 5,807 1,155,537 - - - 1,161,344 - 1,161,344
Issue costs 13 - (44,108) - - - (44,108) - (44,108)
Share based
payments 13,034 797,718 - - - 810,752 - 810,752
Issued options - - - 29,457 - 29,457 - 29,457
Expired options - - - (71,658) 71,658 - - -
Non-controlling
interest
arising
on business
combination - - - - - - 596,771 596,771
Total
transactions
with owners,
recognised
directly in
equity 18,841 1,909,147 - (42,201) 71,658 1,957,445 596,771 2,554,216
Balance as
at 30 June
2016 5,938,572 16,183,675 1,825,104 (7,600,301) (4,458,414) 11,888,636 590,561 12,479,197
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Balance as
at 1 July 2016 5,938,572 16,183,675 1,825,104 (7,600,301) (4,458,414) 11,888,636 590,561 12,479,197
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Loss for the
period - - - - (2,680,708) (2,680,708) - (2,680,708)
----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
Other
comprehensive
income for
the period
Items that
may be
subsequently
reclassified
to profit or
loss
Currency
translation
differences - - - 694,161 - 694,161 - 694,161
Total comprehensive income for the period - - - 694,161 (2,680,708) (1,986,547) - (1,986,547) Proceeds from share issues 13 28,596 11,645,757 - - - 11,674,353 - 11,674,353 Issue costs 13 - (678,756) - - - (678,756) - (678,756) Share based payments 14 100 69,900 - - - 70,000 - 70,000 Issued options 14 - - - 119,439 - 119,439 - 119,439 Exercised options 14 - - - (163,203) 163,203 - - - Acquisition of non-controlling interest on business combination 24 - - - - - - (590,561) (590,561) Total transactions with owners, recognised directly in equity 28,696 11,036,901 - (43,764) 163,203 11,185,036 (590,561) 10,594,475 ----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------ Balance as at 31 December 2017 5,967,268 27,220,576 1,825,104 (6,949,904) (6,975,919) 21,087,125 - 21,087,125 ----------------- ----- ---------- ----------- ---------- ------------ ------------ ------------ ---------------- ------------
COMPANY STATEMENT OF CHANGES IN EQUITY
For the period ended 31 December 2017
Attributable to equity shareholders
Deferred Other Retained
Share capital Share premium shares reserves losses Total equity
Note GBP GBP GBP GBP GBP GBP
Balance as at 1 July
2015 5,919,731 14,274,528 1,825,104 398,010 (10,740,462) 11,676,911
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Loss for the period - - - - (10,247) (10,247)
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Total comprehensive
income for the period - - - - (10,247) (10,247)
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Proceeds from share
issues 13 5,807 1,155,537 - - - 1,161,344
Issue costs 13 - (44,108) - - - (44,108)
Share based payments 13,034 797,718 - - - 810,752
Issued options - - - 29,457 29,457
Expired options - - - (71,658) 71,658 -
Total transactions
with owners,
recognised
directly in equity 18,841 1,909,147 - (42,201) 71,658 1,957,445
Balance as at 30
June 2016 5,938,572 16,183,675 1,825,104 355,809 (10,679,051) 13,624,109
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Balance as at 1 July
2016 5,938,572 16,183,675 1,825,104 355,809 (10,679,051) 13,624,109
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Loss for the period - - - - (1,999,470) (1,999,470)
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Total comprehensive
income for the period - - - - (1,999,470) (1,999,470)
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Proceeds from share
issues 13 28,596 11,645,757 - - - 11,674,353
Issue costs 13 - (678,756) - - - (678,756)
Share based payments 14 100 69,900 - - - 70,000
Issued options 14 - - - 119,439 - 119,439
Exercised options 14 - - - (163,203) 163,203 -
Total transactions
with owners,
recognised
directly in equity 28,696 11,036,901 - (43,764) 163,203 11,185,036
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
Balance as at 31
December 2017 5,967,268 27,220,576 1,825,104 312,045 (12,515,318) 22,809,675
----------------------- --- -------------- -------------- ---------- ---------- ------------- -------------
STATEMENTS OF CASH FLOWS
For the period ended 31 December 2017
Group Company
-------------------------- --------------------------
Period ended Year ended Period ended Year ended
31 December 30 June 31 December 30 June
2017 2016 2017 2016
Note GBP GBP GBP GBP
------------------------------- ----- ------------- ----------- ------------- -----------
Cash flows from operating
activities
Loss before income tax (2,680,708) (620,059) (1,999,470) (10,247)
Adjustments for:
Depreciation 6 46,868 5,037 9,504 1,547
Share options expense 14 119,439 29,457 119,439 29,457
Share based payments 14 70,000 129,302 70,000 129,302
Intercompany management
fees - - (280,628) (120,855)
Impairment on Assets 643,168 - 646,319 -
Foreign exchange (70,953) (2,541) (15,915) (522,341)
Changes in working capital:
Increase in trade and other
receivables 9 (145,345) (99,323) (82,277) (72,652)
Increase/(Decrease) in
trade and other payables 11 127,963 (25,000) 4,142 94,583
Net cash used in operating
activities (1,889,568) (583,127) (1,528,886) (471,206)
------------------------------- ----- ------------- ----------- ------------- -----------
Cash flows from investing
activities
Cash consideration for
subsidiaries net of cash - 4,182 - -
Purchase of property plant
and equipment 6 (653,568) (2,307) (5,909) -
Purchase of software 6 (7,352) (5,312) (7,352) (5,312)
Loans granted to subsidiary
undertakings - - (5,631,501) (984,816)
Loans granted to third
parties (54,000) - (54,000) -
Repayment of borrowings - - - -
Purchase of intangible
assets 7 (4,600,044) (845,261) - -
------------------------------- ----- ------------- ----------- ------------- -----------
Net cash used in investing
activities (5,314,964) (848,698) (5,698,762) (990,128)
------------------------------- ----- ------------- ----------- ------------- -----------
Cash flows from financing
activities
Proceeds from issue of
share capital 13 10,355,803 1,161,344 10,355,803 1,161,344
Transaction costs of share
issue 13 (678,756) (44,108) (678,756) (44,108)
Repayment of borrowings - (62,500) - -
Net cash generated from
financing activities 9,677,047 1,054,736 9,677,047 1,117,236
------------------------------- ----- ------------- ----------- ------------- -----------
Net decrease/(increase)
in cash and cash equivalents 2,472,515 (377,089) 2,449,399 (344,098)
Cash and cash equivalents
at beginning of period 425,046 795,368 371,485 715,583
Exchange gain on cash and
cash equivalents 4,361 6,767 - -
------------------------------- ----- ------------- ----------- ------------- -----------
Cash and cash equivalents
at end of period 10 2,901,922 425,046 2,820,884 371,485 ------------------------------- ----- ------------- ----------- ------------- -----------
Major non-cash transactions
During the year, the Group entered into the following major non-cash transactions:
-- The acquisition of Avannaa Resources Limited for consideration of GBP500,000 which was settled wholly by issuing shares in the Parent Company; and
-- The acquisition of the non-controlling interest in Bluejay Mining Limited for GBP594,393 which was settled wholly by issuing shares in the Parent Company.
-- The deferred consideration due on the acquisition of Bluejay Mining Limited in the prior year for GBP224,157 which was settled wholly by issuing shares in the Parent Company.
Further details on these acquisitions can be found in Note 24 to the Financial Statements.
NOTES TO THE FINANCIAL STATEMENTS
For the period ended 31 December 2017
1. General information
The principal activity of Bluejay Mining plc (the 'Company') and its subsidiaries (together the 'Group') is the exploration and development of precious and base metals. The Company's shares are listed on the AIM of the London Stock Exchange and the Frankfurt Stock Exchange. The Company is incorporated and domiciled in England.
The address of its registered office is 7-9 Swallow Street, London, W1B 4DE.
The group has revised their accounting period to be based on a calendar year (1 January to 31 December). As a result of this, the 2017 financial year is extended to an 18-month period from 1 July 2016 to 31 December 2017.
2. Summary of Significant Accounting Policies
The principal Accounting Policies applied in the preparation of these Consolidated Financial Statements are set out below. These Policies have been consistently applied to all the periods presented, unless otherwise stated.
2.1. Basis of Preparation of Financial Statements
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') and IFRS Interpretations Committee ('IFRS IC') as adopted by the European Union, the Companies Act 2006 that applies to companies reporting under IFRS and IFRS IC interpretations. The Consolidated Financial Statements have also been prepared under the historical cost convention, except as modified for assets and liabilities recognised at fair value on business combination.
The Financial Statements are presented in Pound Sterling rounded to the nearest pound.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Accounting Policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Consolidated Financial Statements are disclosed in Note 4.
2.2. New and Amended Standards
(a) New and amended standards mandatory for the first time for the financial periods beginning on or after 1 July 2016
The following IFRSs or IFRIC interpretations were effective for the first time for financial periods beginning on or after 1 July 2016. Their adoption has not had any material impact on the disclosures or on the amounts reported in these financial statements.
Standard Impact on initial application Effective date
--------- ------------------------------------ ---------------
IAS 1 Amendments to Disclosure Initiative 1 January 2016
------------------------------------ ---------------
IFRS 12 Annual Improvements 2012 -2014 1 January 2016
cycle
------------------------------------ ---------------
(b) New standards, amendments and Interpretations in issue but not yet effective or not yet endorsed and not early adopted
Standards, amendments and interpretations that are not yet effective and have not been early adopted are as follows:
Standard Impact on initial application Effective date
--------------------- -------------------------------------- ---------------
IFRS 9 Financial Instruments 1 January 2018
-------------------------------------- ---------------
IFRS 15 Revenue from Contracts with 1 January 2018
Customers
-------------------------------------- ---------------
IFRS 16 Leases *1 January
2019
-------------------------------------- ---------------
IFRS 2 (Amendments) Share-based payments - classification 1 January 2018
and measurement
-------------------------------------- ---------------
Annual Improvements 2014-2016 Cycle 1 January 2018
-------------------------------------- ---------------
IFRIC Interpretation Foreign currency transactions *1 January
22 and advanced 2018
consideration
-------------------------------------- ---------------
IFRIC 23 Uncertainty over Income tax *1 January
treatments 2018
-------------------------------------- ---------------
(*) Subject to EU endorsement
The Group is evaluating the impact of the new and amended standards above. The Directors believe that these new and amended standards are not expected to have a material impact on the Group's results or shareholders' funds.
2.3. Basis of Consolidation
The Consolidated Financial Statements consolidate the financial statements of the Company and its subsidiaries made up to 31 December. Subsidiaries are entities over which the Group has control. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
Generally, there is a presumption that a majority of voting rights result in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:
-- The contractual arrangement with the other vote holders of the investee; -- Rights arising from other contractual arrangements; and -- The Group's voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the period are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.
Investments in subsidiaries are accounted for at cost less impairment within the parent company financial statements. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used in line with those used by other members of the Group. All significant intercompany transactions and balances between Group enterprises are eliminated on consolidation.
2.4. Going Concern
The Group's business activities together with the factors likely to affect its future development, performance and position are set out in the Chairman's Report. In addition, Note 3 to the Consolidated Financial Statements includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and its exposure to market, credit and liquidity risk.
The Consolidated Financial Statements have been prepared on a going concern basis. Although the Group's assets are not generating revenues and an operating loss has been reported, the Directors are of the view that the Group has sufficient funds to undertake its operating activities over the next 12 months from the date these financial statements are approved including any additional payments required in relation to its current exploration projects. The Group has financial resources which the Directors consider will be sufficient to fund the Group's committed expenditure both operationally and on various exploration projects for this time period. However, in order to complete other exploration work over the life of existing projects and as additional projects are identified, additional funding will be required. The amount of funding cannot be forecast with any certainty at the point of approval of these Financial Statements and the Group will be required to raise additional funds either via an issue of equity or through the issuance of debt. The Directors are reasonably confident that funds will be forthcoming if and when they are required. Should additional funding not be forthcoming the Directors have agreed, if circumstances require, to defer payment of their fees until such time as adequate funding is received and if necessary scale back exploration activity.
The Directors have a reasonable expectation that the Group and Company have adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing the Group and Company Financial Statements.
2.5. Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (CODM). The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.
Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
2.6. Foreign Currencies
(a) Functional and presentation currency
Items included in the Financial Statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the 'functional currency'). The functional currency of the UK parent entity and UK subsidiary is Pound Sterling, the functional currency of the Finnish and Austrian subsidiaries is Euros and the functional currency of the Greenlandic subsidiaries is Danish Krone. The Financial Statements are presented in Pounds Sterling which is the Company's functional and Group's presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where such items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.
(c) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
-- assets and liabilities for each period end date presented are translated at the period-end closing rate;
-- income and expenses for each Income Statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and
-- all resulting exchange differences are recognised in other comprehensive income.
On consolidation, exchange differences arising from the translation of the net investment in foreign entities, and of monetary items receivable from foreign subsidiaries for which settlement is neither planned nor likely to occur in the foreseeable future, are taken to other comprehensive income. When a foreign operation is sold, such exchange differences are recognised in the Income Statement as part of the gain or loss on sale.
2.7. Intangible assets
Exploration and evaluation assets
The Group recognises expenditure as exploration and evaluation assets when it determines that those assets will be successful in finding specific mineral resources. Expenditure included in the initial measurement of exploration and evaluation assets and which are classified as intangible assets relate to the acquisition of rights to explore, topographical, geological, geochemical and geophysical studies, exploratory drilling, trenching, sampling and activities to evaluate the technical feasibility and commercial viability of extracting a mineral resource. Capitalisation of pre-production expenditure ceases when the mining property is capable of commercial production.
Exploration and evaluation assets are recorded and held at cost
Exploration and evaluation assets are not subject to amortisation, but are assessed annually for impairment. The assessment is carried out by allocating exploration and evaluation assets to cash generating units ("CGU's"), which are based on specific projects or geographical areas. The CGU's are then assessed for impairment using a variety of methods including those specified in IFRS 6.
Whenever the exploration for and evaluation of mineral resources in cash generating units does not lead to the discovery of commercially viable quantities of mineral resources and the Group has decided to discontinue such activities of that unit, the associated expenditures are written off to the Income Statement.
Exploration and evaluation assets recorded at fair-value on business combination
Exploration assets which are acquired as part of a business combination are recognised at fair value in accordance with IFRS 3. When a business combination results in the acquisition of an entity whose only significant assets are its exploration asset and/or rights to explore, the Directors consider that the fair value of the exploration assets is equal to the consideration. Any excess of the consideration over the capitalised exploration asset is attributed to the fair value of the exploration asset.
2.8. Investments in subsidiaries
Investments in Group undertakings are stated at cost, which is the fair value of the consideration paid, less any impairment provision.
2.9. Property, Plant and Equipment
Property, Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is provided on all property, plant and equipment to write off the cost less estimated residual value of each asset over its expected useful economic life on a straight line basis at the following annual rates:
Office Equipment - 20% straight line
Machinery and Equipment - 10% straight line
Software - 50% straight line
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within 'Other (losses)/gains' in the Income Statement.
2.10. Impairment of non-financial assets
Assets that have an indefinite useful life, for example, intangible assets not ready to use, and goodwill, are not subject to amortisation and are tested annually for impairment. Property, plant and equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.
2.11. Financial Assets
(a) Classification
The Group classifies its financial assets as loans and receivables. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current assets. The Group's loans and receivables comprise trade and other receivables and cash and cash equivalents.
(b) Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade date - the date on which the Group commits to purchasing or selling the asset. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or have been transferred, and the Group has transferred substantially all of the risks and rewards of ownership. Loans and receivables are subsequently carried at amortised cost using the effective interest method.
(c) Impairment of financial assets
The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset, or a group of financial assets, is impaired. A financial asset, or a group of financial assets, is impaired, and impairment losses are incurred, only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a "loss event"), and that loss event (or events) has an impact on the estimated future cash flows of the financial asset, or group of financial assets, that can be reliably estimated.
The criteria that the Group uses to determine that there is objective evidence of an impairment loss include:
-- significant financial difficulty of the issuer or obligor; -- a breach of contract, such as a default or delinquency in interest or principal repayments;
-- the disappearance of an active market for that financial asset because of financial difficulties;
-- observable data indicating that there is a measureable decrease in the estimated future cash flows from a portfolio of financial assets since the initial recognition of those assets, although the decrease cannot yet be identified with the individual financial assets in the portfolio;
For loans and receivables, the amount of the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred), discounted at the financial asset's original effective interest rate. The asset's carrying amount is reduced, and the loss is recognised in the Income Statement.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor's credit rating), the reversal of the previously recognised impairment loss is recognised in the Income Statement.
2.12. Financial Liabilities
Financial liabilities comprise trade and other payables in the Statement of Financial Position and are held at amortised cost.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.
Trade payables are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method.
2.13. Cash and Cash Equivalents
Cash and cash equivalents comprise cash at bank and in hand.
2.14. Equity
Equity comprises the following:
-- "Share capital" represents the nominal value of the Ordinary shares;
-- "Share Premium" represents consideration less nominal value of issued shares and costs directly attributable to the issue of new shares;
-- "Other reserves" represents the merger reserve, foreign currency translation reserve, redemption reserve and share option reserve where;
o "Merger reserve" represents the difference between the fair value of an acquisition and the nominal value of the shares allotted in a share exchange;
o "Foreign currency translation reserve" represents the translation differences arising from translating the financial statement items from functional currency to presentational currency;
o "Redemption reserve" represents a non-distributable reserve made up of share capital;
o "Share option reserve" represents share options awarded by the group;
-- "Retained earnings" represents retained losses. 2.15. Share capital, share premium and deferred shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity, as a deduction, net of tax, from the proceeds provided there is sufficient premium available. Should sufficient premium not be available placing costs are recognised in the Income Statement.
Deferred shares are classified as equity. Deferred shares have no rights to receive dividends, or to attend or vote at general meetings of the Company and are only entitled to a return of capital after payment to holders of new ordinary shares of GBP100,000 per each share held.
2.16. Share Based Payments
The Group operates a number of equity-settled, share-based schemes, under which the Group receives services from employees or third party suppliers as consideration for equity instruments (options and warrants) of the Group. The fair value of the third party suppliers' services received in exchange for the grant of the options is recognised as an expense in the Income Statement or charged to equity depending on the nature of the service provided. The value of the employee services received is expensed in the Income Statement and its value is determined by reference to the fair value of the options granted:
-- including any market performance conditions;
-- excluding the impact of any service and non-market performance vesting conditions (for example, profitability or sales growth targets, or remaining an employee of the entity over a specified time period); and
-- including the impact of any non-vesting conditions (for example, the requirement for employees to save).
The fair value of the share options and warrants are determined using the Black Scholes valuation model.
Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total expense or charge is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in the Income Statement or equity as appropriate, with a corresponding adjustment to a separate reserve in equity.
When the options are exercised, the Group issues new shares. The proceeds received, net of any directly attributable transaction costs, are credited to share capital (nominal value) and share premium when the options are exercised.
2.17. Taxation
No current tax is yet payable in view of the losses to date.
Deferred tax is recognised for using the liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill; deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets (including those arising from investments in subsidiaries), are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.
Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the temporary difference can be used.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in 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.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.
Deferred tax is calculated at the tax rates (and laws) that have been enacted or substantively enacted by the statement of financial position date and are expected to apply to the period when the deferred tax asset is realised or the deferred tax liability is settled.
Deferred tax assets and liabilities are not discounted.
3. Financial Risk Management 3.1. Financial Risk Factors
The Group's activities expose it to a variety of financial risks: market risk (foreign currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. None of these risks are hedged.
Risk management is carried out by the London based management team under policies approved by the Board of Directors.
Market Risk
(a) Foreign currency risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Euro, Danish Krone and the British Pound. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.
The Group negotiates all material contracts for activities in relation to its subsidiaries in either British Pounds, Euros or Danish Krone. The Group does not hedge against the risks of fluctuations in exchange rates. The volume of transactions is not deemed sufficient to enter into forward contracts as most of the foreign exchange movements result from the retranslation of inter company loans. The Group has not sensitised the figures for fluctuations in foreign exchange rates as the Directors are of the opinion that these fluctuations, apart from the retranslation of intercompany loans at the closing rate, would not have a significant impact on the financial statements of the Group. However, the Directors acknowledge that, at the present time, the foreign exchange retranslations have resulted in rather higher than normal fluctuations which are separately disclosed, and is predominantly due to the exceptional nature of the Euro exchange rate in the last two years in the current economic climate. The Directors will continue to assess the effect of movements in exchange rates on the Group's financial operations and initiate suitable risk management measures where necessary.
(b) Price risk
The Group is not exposed to commodity price risk as a result of its operations, which are still in the exploration phase. The Directors will revisit the appropriateness of this policy should the Group's operations change in size or nature.
The Group has no exposure to equity securities price risk, as it has no listed or unlisted equity investments other than investments in wholly owned subsidiaries.
Credit Risk
Credit risk arises from cash and cash equivalents as well as outstanding receivables. Management does not expect any losses from non-performance of these receivables. The amount of exposure to any individual counter party is subject to a limit, which is assessed by the Board.
The Group considers the credit ratings of banks in which it holds funds in order to reduce exposure to credit risk.
Liquidity Risk
In keeping with similar sized mineral exploration groups, the Group's continued future operations depend on the ability to raise sufficient working capital through the issue of equity share capital or debt. The Directors are reasonably confident that adequate funding will be forthcoming with which to finance operations. Controls over expenditure are carefully managed.
With exception to deferred taxation, financial liabilities are all due within one year.
3.2. Capital Risk Management
The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern, to enable the Group to continue its exploration and evaluation activities, and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the issue of shares or sell assets to reduce debts.
At 31 December 2017 the Group had borrowings of GBPnil (30 June 2016: GBPnil) and defines capital based on the total equity of the Company. The Group monitors its level of cash resources available against future planned exploration and evaluation activities and may issue new shares in order to raise further funds from time to time.
Given the Group's level of debt versus its cash at bank and cash equivalents, the gearing ratio is immaterial.
3.3. Sensitivity Analysis
On the assumption that all other variables were held constant, and in respect of the Group and the Company's expenses the potential impact of a 10% increase/decrease in the UK Sterling:Euro and UK Sterling:DKK Foreign exchange rates on the Group's loss for the period and on equity is as follows:
Effect on loss before
Potential impact on euro tax for the period Effect on equity before
expenses: 2017 ended tax for the year ended
Group Company Group Company
Increase/(decrease) in
foreign exchange rate GBP GBP GBP GBP
------------------------- ------------ ------------ ------------ ------------
10% (2,752,612) (2,680,708) 22,427,782 13,624,108
-10% (2,608,804) (2,680,708) 19,746,470 13,624,108
Effect on loss before Effect on equity
Potential impact on DKK tax for the period before tax for the
expenses: 2017 ended year ended
Group Company Group Company
Increase/(decrease) in
foreign exchange rate GBP GBP GBP GBP
------------------------ ------------ ------------ ----------- -----------
10% (2,709,050) (2,680,708) 21,092,538 13,624,108
-10% (2,652,366) (2,680,708) 21,081,714 13,624,108
4. Critical Accounting Estimates and Judgements
The preparation of the Financial Statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of expenses during the period. Actual results may vary from the estimates used to produce these Financial Statements.
Estimates and judgements are regularly evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Items subject to such estimates and assumptions, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial years, include but are not limited to:
Impairment of intangible assets - exploration and evaluation costs
Exploration and evaluation costs have a carrying value at 31 December 2017 of GBP17,971,795 (2016: GBP12,627,681). Such assets have an indefinite useful life as the Group has a right to renew exploration licences and the asset is only amortised once extraction of the resource commences. Management tests for impairment annually whether exploration projects have future economic value in accordance with the accounting policy stated in Note 2.7. Each exploration project is subject to an annual review by either a consultant or senior company geologist to determine if the exploration results returned during the period warrant further exploration expenditure and have the potential to result in an economic discovery. This review takes into consideration long term metal prices, anticipated resource volumes and supply and demand outlook. In the event that a project does not represent an economic exploration target and results indicate there is no additional upside a decision will be made to discontinue exploration; an impairment charge will then be recognised in the Income Statement. The Directors have reviewed the estimated value of each project prepared by management and have concluded that the Austrian exploration asset be impaired in full.
Share based payment transactions
The Group has made awards of options and warrants over its unissued share capital to certain Directors as part of their remuneration package. Certain warrants have also been issued to shareholders as part of their subscription for shares and suppliers for various services received.
The valuation of these options and warrants involves making a number of critical estimates relating to price volatility, future dividend yields, expected life of the options and forfeiture rates. These assumptions have been described in more detail in Note 14.
VAT receivable
At 31 December 2017, the Group and Company have recognised an amount of GBP287,731 within trade and other receivables which relates to VAT receivable. The amount is subject to an on-going dispute with HMRC, further details of which can be found in note 23. The Directors believe that the amount will be recovered in full and therefore have not recognised any impairment to the carrying value of this amount.
5. Segment Information
Management has determined the operating segments based on reports reviewed by the Board of Directors that are used to make strategic decisions. During the period the Group had interests in four geographical segments; the United Kingdom, Greenland, Austria, and Finland. Activities in the UK are mainly administrative in nature whilst the activities in Austria and Finland relate to exploration and evaluation work.
The Group had no turnover during the period.
Greenland Austria Finland UK Total
2017 GBP GBP GBP GBP GBP
---------------------- ---------- ---------- ----------- ------------ --------------
Revenue - - - - -
Administrative
expenses 27,846 (13,317) (97,633) (2,028,208) (2,111,312)
Foreign Exchange 1,791 71,421 (8) (2,251) 70,953
Finance Income - - 15 1,702 1,717
Other Income 1,102 - - - 1,102
Impairment on
intangible asset - (643,168) - - (643,168)
Loss before
tax per reportable
segment 30,739 (585,064) (97,626) (2,028,757) (2,680,708)
Additions to
PP&E 647,660 - - 13,260 660,920
Additions to
intangible
asset 3,986,730 - 2,000,553 - 5,987,283
Reportable
segment assets 6,982,095 11,666 11,867,293 3,286,587 22,147,641
Reportable
segment liabilities 713,940 4,194 147,594 194,787 1,060,515
---------------------- ---------- ---------- ----------- ------------ --------------
Greenland Austria Finland UK Total
2016 GBP GBP GBP GBP GBP
-------------------- ---------- --------- ---------- ---------- -------------
Revenue - - - - -
Administrative
expenses (3,629) (69,858) (34,630) (520,929) (629,046)
Foreign Exchange 196 (394) 9690 (755) 8,737
Finance Income - - 11 239 250
Other Income - - - - 1,102
Loss before tax
per reportable
segment (3,433) (70,252) (24,929) (521,445) (620,059)
Additions to
PP&E 993 - - 3,563 4,556
Additions to
intangible asset 2,265,857 93,313 1,836,448 - 4,195,618
Reportable segment
assets 2,302,853 612,887 9,812,573 473,790 13,202,103
Reportable segment
liabilities 1094 2,116 21,140 741,747 766,097
-------------------- ---------- --------- ---------- ---------- -------------
6. Property, Plant and Equipment
Group
Machinery
Software & equipment Office equipment Total
GBP GBP GBP GBP
---------------------------------- --------- ------------- ----------------- --------
Cost
As at 1 July 2015 - 18,567 3,124 21,691
Exchange differences - 3,183 - 3,183
Additions 5,312 - 2,307 7,619
---------------------------------- --------- ------------- ----------------- --------
As at 30 June 2016 5,312 21,750 5,431 32,493
---------------------------------- --------- ------------- ----------------- --------
As at 1 July 2016 5,312 21,750 5,431 32,493
Exchange Differences - 1,602 - 1,602
Additions 7,352 647,659 5,909 660,920
---------------------------------- --------- ------------- ----------------- --------
As at 31 December 2017 12,664 671,011 11,340 695,015
---------------------------------- --------- ------------- ----------------- --------
Depreciation
As at 1 July 2015 - 7,052 2,312 9,364
Charge for the year 734 2,177 2,126 5,037
Exchange differences - 1,209 - 1,209
---------------------------------- --------- ------------- ----------------- --------
As at 30 June 2016 734 10,438 4,438 15,610
---------------------------------- --------- ------------- ----------------- --------
As at 1 July 2016 734 10,438 4,438 15,610
Charge for the period 7,379 36,371 3,118 46,868
Exchange differences - 1,483 - 1,483
---------------------------------- --------- ------------- ----------------- --------
As at 31 December 2017 8,113 48,292 7,556 63,961
---------------------------------- --------- ------------- ----------------- --------
Net book value as at 30 June
2016 4,578 11,312 993 16,883
---------------------------------- --------- ------------- ----------------- --------
Net book value as at 31 December
2017 4,551 622,719 3,784 631,054
---------------------------------- --------- ------------- ----------------- --------
Depreciation expense of GBP46,868 (30 June 2016: GBP5,037) for the Group has been charged in administration expenses.
Company
Software Office equipment Total
GBP GBP GBP
----------------------------------- --------- ----------------- -------
Cost
As at 1 July 2015 - 3,124 3,124
Additions 5,312 - 5,312
------------------------------------ --------- ----------------- -------
As at 30 June 2016 5,312 3,124 8,436
------------------------------------ --------- ----------------- -------
As at 1 July 2016 5,312 3,124 8,436
Additions 7,352 5,909 13,260
------------------------------------ --------- ----------------- -------
As at 31 December 2017 12,664 9,033 21,697
------------------------------------ --------- ----------------- -------
Depreciation
As at 1 July 2015 - 2,311 2,311
Charge for the year 734 813 1,547
------------------------------------ --------- ----------------- -------
As at 30 June 2016 734 3,124 3,858
------------------------------------ --------- ----------------- -------
As at 1 July 2016 734 3,124 3,858
Charge for the period 7,379 2,126 9,505
------------------------------------ --------- ----------------- -------
As at 31 December 2017 8,113 5,250 13,363
------------------------------------ --------- ----------------- -------
Net book value as at 30 June 2016 4,577 - 4,577
------------------------------------ --------- ----------------- -------
Net book value as at 31 December
2017 4,550 3,783 8,333
------------------------------------ --------- ----------------- -------
Depreciation expense of GBP9,505 (30 June 2016: GBP1,547) for the Company has been charged in administration expenses.
7. Intangible Assets
Intangible assets comprise exploration and evaluation costs. Exploration and evaluation assets are all internally generated.
Group
-------------------------
31 December 30 June
Exploration & Evaluation Assets - Cost 2017 2016
and Net Book Value GBP GBP
---------------------------------------------- ------------ -----------
As at 1 July 12,627,680 8,432,062
Additions 4,600,044 842,281
Acquired through acquisition (at fair value)
(Note 24) 622,702 1,912,886
Exchange differences 764,537 1,440,451
Impairments (643,168) -
---------------------------------------------- ------------ -----------
As at end of period 17,971,795 12,627,680
---------------------------------------------- ------------ -----------
Exploration projects in Finland and Greenland are at an early stage of development and there are JORC (Joint Ore Reserves Committee) or non-JORC compliant resource estimates are available to enable value in use calculations to be prepared. The Directors therefore undertook an assessment of the following areas and circumstances that could indicate the existence of impairment:
-- The Group's right to explore in an area has expired, or will expire in the near future without renewal;
-- No further exploration or evaluation is planned or budgeted for;
-- A decision has been taken by the Board to discontinue exploration and evaluation in an area due to the absence of a commercial level of reserves; or
-- Sufficient data exists to indicate that the book value will not be fully recovered from future development and production.
Following their assessment the Directors concluded that impairment charge of GBP643,168 was necessary for the period ended 31 December 2017 as the asset was not leading to the discovery of commercially viable quantities of mineral resources.
8. Investments in Subsidiary Undertakings
Company
-------------------------
31 December 30 June
2017 2016
GBP GBP
----------------------------------- ------------ -----------
Shares in Group Undertakings
At beginning of period 8,605,609 7,700,002
Additions in period (see note 24) 1,094,393 905,607
----------------------------------- ------------ -----------
At end of period 9,700,002 8,605,609
----------------------------------- ------------ -----------
Loans to Group undertakings 10,017,871 4,899,665
----------------------------------- ------------ -----------
Total 19,717,873 13,505,274
----------------------------------- ------------ -----------
Investments in Group undertakings are stated at cost, which is the fair value of the consideration paid, less any impairment provision.
Subsidiaries
Proportion Proportion
of ordinary of ordinary
Country of shares shares held
incorporation held by by the Group
Registered office and place parent (%) Nature
Name of subsidiary address of business (%) of business
--------------------- ----------------------- ---------------- ------------- -------------- -------------
2nd Floor 7-9 Swallow
Centurion Mining Street, London,
Limited England, W1B 4DE United Kingdom 100% 100% Dormant
--------------------- ----------------------- ---------------- ------------- -------------- -------------
2nd Floor 7-9 Swallow
Centurion Universal Street, London,
Limited England, W1B 4DE United Kingdom 100% 100% Holding
--------------------- ----------------------- ---------------- ------------- -------------- -------------
Centurion Resources Schottenring 14 Austria Nil 100% Exploration
GmbH /525
1010 Vienna, Austria
----------------------------------------- -------------------- ------------- -------------- -------------
2nd Floor 7-9 Swallow
Finland Investments Street, London,
Limited England, W1B 4DE United Kingdom 100% 100% Holding
--------------------- ----------------------- ---------------- ------------- -------------- -------------
FinnAust Mining Kummunkatu 23, Finland Nil 100% Exploration
Finland Oy FI-83500 Outokumpu,
Finland
--------------------- ----------------------- ---------------- ------------- -------------- -------------
FinnAust Mining Kummunkatu 23, Finland Nil 100% Exploration
Northern Oy FI-83500 Outokumpu,
Finland
--------------------- ----------------------- ---------------- ------------- -------------- -------------
2nd Floor 7-9 Swallow
Street, London,
BJ Mining Limited England, W1B 4DE BVI 100% 100% Exploration
--------------------- ----------------------- ---------------- ------------- -------------- -------------
2nd Floor 7-9 Swallow
Disko Exploration Street, London,
Limited England, W1B 4DE United Kingdom 100% 100% Exploration
--------------------- ----------------------- ---------------- ------------- -------------- -------------
Dundas Titanium c/o Nuna Advokater Greenland Nil 100% Exploration
A/S ApS, Qullilerfik
2, 6, Postboks 59,
Nuuk 3900, Greenland
--------------------- ----------------------- ---------------- ------------- -------------- -------------
All subsidiary undertakings are included in the consolidation.
The proportion of the voting rights in the subsidiary undertakings held directly by the parent company do not differ from the proportion of ordinary shares held.
9. Trade and Other Receivables
Group Company
---------------------- ----------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
Current GBP GBP GBP GBP
------------------------------------ ------------ -------- ------------ --------
Trade receivables 30,614 - 30,614 -
Amounts owed by Group undertakings - - 163,519 -
Amounts owed by Directors
(see note 25) 41,623 - 41,623 -
Prepayments 55,587 72,510 43,404 33,362
VAT receivable (See note 23) 346,274 78,142 287,731 77,814
Other receivables 168,772 25,033 54,000 -
------------------------------------ ------------ -------- ------------ --------
Total 642,870 175,685 620,891 111,176
------------------------------------ ------------ -------- ------------ --------
The fair value of all receivables is the same as their carrying values stated above.
At 31 December 2017 all trade and other receivables were fully performing. No ageing analysis is considered necessary as the Group has no significant trade receivable receivables which would require such an analysis to be disclosed under the requirements of IFRS 7.
The carrying amounts of the Group and Company's trade and other receivables are denominated in the following currencies:
Group Company
---------------------- ----------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
GBP GBP GBP GBP
-------------- ------------ -------- ------------ --------
UK Pounds 463,315 140,666 620,891 111,176
Euros 82,615 35,019 - -
Danish Krone 96,940 - - -
-------------- ------------ -------- ------------ --------
642,870 175,685 620,891 111,176
-------------- ------------ -------- ------------ --------
The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The Group does not hold any collateral as security.
10. Cash and Cash Equivalents
Group Company
---------------------- ----------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
GBP GBP GBP GBP
-------------------------- ------------ -------- ------------ --------
Cash at bank and in hand 2,901,922 425,046 2,820,884 371,485
-------------------------- ------------ -------- ------------ --------
All of the UK entities cash at bank is held with institutions with an AA- credit rating. The Finland & Greenland entities cash at bank is held with institutions whose credit rating is unknown.
The carrying amounts of the Group and Company's cash and cash equivalents are denominated in the following currencies:
Group Company
-------------------- ----------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
GBP GBP GBP GBP
-------------------------- -------- ------------ --------
UK Pounds 2,820,998 377,998 2,820,884 371,485
Euros 68,491 47,048 - -
Danish Krone 12,433 - -
--------------- ---------- -------- ------------ --------
2,901,922 425,046 2,820,884 371,485
--------------- ---------- -------- ------------ --------
11. Trade and Other Payables
Group Company
------------------ ----------------------
31 December 30 June 31 December 30 June
2017 2016 2017 2016
GBP GBP GBP GBP
---------------------------- -------- ------------ --------
Trade payables 424,372 136,559 297,504 124,786
Other creditors 76,422 229,361 8,657 224,159
Accrued expenses 63,677 26,834 52,145 19,458
------------------- -------- -------- ------------ --------
564,471 392,754 358,306 368,403
------------------- -------- -------- ------------ --------
Trade payables include amounts due of GBP322,716 in relation to exploration and evaluation activities.
12. Deferred Tax
An analysis of deferred tax liabilities is set out below.
Group Company
------------------ ------------
2017 2016 2017 2016
GBP GBP GBP GBP
-------------------------------- -------- -------- ----- -----
Deferred tax liabilities
- Deferred tax liability after
more than 12 months 496,045 373,343 - -
Deferred tax liabilities 496,045 373,343 - -
-------------------------------- -------- -------- ----- -----
The movement in the deferred tax account is as follows:
Group Company
------------------ ------------
2017 2016 2017 2016
GBP GBP GBP GBP
--------------------------------- -------- -------- ----- -----
At 1 June 2016 373,343 - - -
Acquisition of subsidiary (Note
23) 122,702 373,343 - -
--------------------------------- -------- -------- ----- -----
As at 31 December 496,045 373,343 - -
--------------------------------- -------- -------- ----- -----
The Group has additional capital losses of approximately GBP643,168 (2016: GBPnil) and other losses of approximately GBP5,728,559 (2016: GBP4,752,742) available to carry forward against future taxable profits. No deferred tax asset has been recognised in respect of these tax losses because of uncertainty over the timing of future taxable profits against which the losses may be offset.
13. Share capital and premium
Group and Company
Ordinary
Number of shares Share premium Total
Issued and fully paid shares GBP GBP GBP
------------------------------------ ------------ ---------- -------------- -----------
At 30 June 2016 484,400,804 5,938,572 16,183,675 22,122,247
------------------------------------ ------------ ---------- -------------- -----------
Issue of new shares - 13 July
2016 (1) 10,000,000 1,000 479,100 480,100
Issue of new shares - 8 December
2016 (2 & 3) 117,184,457 11,719 5,228,092 5,239,811
Issue of new shares - 4 January
2017 (4) 7,584,238 758 499,242 500,000
Exercise of Options - 22 February
2017 1,000,000 100 19,900 20,000
Exercise of Options - 27 February
2017 2,000,000 200 144,800 145,000
Issue of new shares - 13 March
2017 (5) 108,071,388 10,807 583,586 594,393
Exercise of Options - 31 March
2017 1,333,333 133 99,867 100,000
Exercise of Options - 4 April
2017 1,625,000 163 52,338 52,501
Exercise of Options - 20 April
2017 2,766,667 277 228,473 228,749
Exercise of Options - 8 May
2017 250,000 25 18,725 18,750
Exercise of Options - 24 May
2017 1,500,000 150 112,350 112,500
Issue of new shares - 9 June
2017 (6) 29,166,667 2,917 3,172,574 3,175,490
Exercise of Options - 28 July
2017 1,550,000 155 154,845 155,000
Exercise of Options - 31 October
2017 1,284,366 128 128,308 128,436
Exercise of Warrants - 1 November
2017 1,000,000 100 69,900 70,000
Exercise of Warrants - 18 December
2017 640,946 64 44,802 44,866
------------------------------------ ------------ ---------- -------------- -----------
As at 31 December 2017 771,357,866 5,967,268 27,220,576 33,187,843
------------------------------------ ------------ ---------- -------------- -----------
(1) Includes issue costs of GBP19,900
(2) Issue of shares for deferred cash consideration for BJ Mining Limited.
(3) Includes issue costs of GBP334,347
(4) Issue of shares for acquisition of Avannaa Exploration Limited
(5) Issue of shares for remaining ownership in BJ Mining Limited
(6) Includes issue costs of GBP324,509
On 13 July 2016 the Company raised GBP500,000 via the issue and allotment of 10,000,000 new ordinary shares of 0.01 pence each fully paid ('Ordinary Shares') at a price of 5 pence per share.
On 8 December 2016 the Company issued and allotted 40,755,885 new Ordinary Shares at a price of 0.55 pence per share as deferred consideration for a business acquisition. On the same date the Company raised GBP5,350,000 via the issue and allotment of 76,428,572 new Ordinary Shares at a price of 7 pence per share.
On 4 January 2017 the Company issued and allotted 7,584,238 new Ordinary Shares at a price of 6.59 pence per share as consideration for a business acquisition.
On 22 February 2017 the Company issued and allotted 1,000,000 new Ordinary Shares at a price of 2 pence per share as an exercise of options.
On 27 February 2017 the Company issued and allotted 1,000,000 new Ordinary Shares at a price of 7.5 pence per share as an exercise of options. On the same date the Company issued and allotted 1,000,000 via the issue and allotment of 10,000,000 new Ordinary Shares at a price of 7 pence per share.
On 13 March 2017 the Company issued and allotted 108,071,388 new Ordinary Shares at a price of 0.55 pence per share as consideration for business acquisition.
On 31 March 2017 the Company issued and allotted 1,333,333 new Ordinary Shares at a price of 7.5 pence per share as an exercise of options.
On 4 April 2017 the Company issued and allotted 625,000 new Ordinary Shares at a price of 2 pence per share as an exercise of options. On the same date the Company issued and allotted 1,000,000 new Ordinary Shares at a price of 4 pence per share as an exercise of options.
On 20 April 2017 the Company issued and allotted 1,916,667 new Ordinary Shares at a price of 7.5 pence per share as an exercise of options. On the same date the Company issued and allotted 850,000 new Ordinary Shares at a price of 10 pence per share as consideration for services provided
On 8 May 2017 the Company issued and allotted 250,000 new Ordinary Shares at a price of 7.5 pence per share as an exercise of options.
On 24 May 2017 the Company issued and allotted 1,500,000, new Ordinary Shares at a price of 7.5 pence per share as consideration for services provided
On 9 June 2017 the Company raised GBP3,175,490 via the issue and allotment of 29,166,667 new Ordinary Shares at a price of 12 pence per share.
On 28 July 2017 the Company issued and allotted 1,550,000 new Ordinary Shares at a price of 10 pence per share as an exercise of options.
On 31 October 2017 the Company issued and allotted 1,284,366 new Ordinary Shares at a price of 10 pence per share as an exercise of options.
On 1 November 2017 the Company issued and allotted 1,000,000 new Ordinary Shares at a price of 7 pence per share as an exercise of warrants.
On 18 December 2017 the Company issued and allotted 640,946 new Ordinary Shares at a price of 7 pence per share as an exercise of warrants.
14. Share Based Payments
Shares issued to employees
On 27 February 2017 the company issued and allotted 1,000,000 Ordinary Shares to employees at a price of 7 pence per share.
Share options
Share options and warrants outstanding and exercisable at the end of the period have the following expiry dates and exercise prices:
Options & Warrants
Exercise price 31 December 30 June
Grant Date Expiry Date in GBP per share 2017 2016
------------------ ------------------ ------------------ ------------ -----------
29 November 2013 29 May 2017 0.075 - 6,000,000
12 November 2012 12 November 2017 0.10 - 3,684,366
29 November 2013 29 May 2019 0.10 6,000,000 6,000,000
4 March 2016 3 March 2017 0.02 - 1,000,000
4 March 2016 3 March 2018 0.04 - 1,000,000
4 March 2016 3 March 2019 0.06 1,000,000 1,000,000
15 April 2016 14 April 2021 0.02 - 625,000
17 December 2016 17 December 2021 0.07 2,689,768 -
9 June 2017 9 June 2022 0.165 1,025,000 -
17 October 2017 17 October 2020 0.20 5,350,000 -
17 October 2017 17 October 2020 0.25 5,350,000 -
17 October 2017 17 October 2020 0.30 5,350,000 -
------------------ ------------------ ------------------ ------------ -----------
26,764,768 19,309,366
------------------------------------- ------------------ ------------ -----------
The Company and Group have no legal or constructive obligation to settle or repurchase the options or warrants in cash.
The fair value of the share options and warrants was determined using the Black Scholes valuation model. The parameters used are detailed below:
2013 Options 2016 Options 2016 Options 2017 Options
------------- ------------- ------------- -------------
Granted on: 29/11/2013 4/3/2016 17/12/2016 9/6/2017
Life (years) 5.5 years 3 years 5 years 5 years
Share price (pence per
share) 5.7p 3.03p 7p 15.5p
Risk free rate 2.25% 0.81% 0.81% 0.56%
Expected volatility 26.41% 48.40% 17.64% 31.83%
Expected dividend yield - - - -
Marketability discount 20% 20% 20% 20%
Total fair value (GBP000) 4 3 17 34
2017 Options 2017 Options 2017 Options
------------- ------------- -------------
Granted on: 17/10/2017 17/10/2017 17/10/2017
Life (years) 3 years 3 years 3 years
Share price (pence per share) 17.75p 17.75p 17.75p
Risk free rate 0.5% 0.5% 0.5%
Expected volatility 13.85% 13.85% 13.85%
Expected dividend yield - - -
Marketability discount 20% 20% 20%
Total fair value (GBP000) 42 8 1
The expected volatility of the 2013, 2016 and 2017 options is based on historical volatility for the six months prior to the date of granting.
The risk-free rate of return is based on zero yield government bonds for a term consistent with the option life.
A reconciliation of options and warrants granted over the period to 31 December 2017 is shown below:
2017 2016
-------------------------------- --------------------------------
Weighted average Weighted
exercise price average exercise
Number (GBP) Number price (GBP)
-------------------------- ------------- ----------------- ------------ ------------------
Outstanding at beginning
of period 19,309,366 0.1347 17,366,296 0.1237
Expired - - (1,681,930) 0.0043
Exercised (13,950,312) 0.1347 - -
Granted 21,405,714 0.2210 3,625,000 0.0366
-------------------------- ------------- ----------------- ------------ ------------------
Outstanding as at period
end 26,764,768 0.1900 19,309,366 0.1347
-------------------------- ------------- ----------------- ------------ ------------------
Exercisable at period
end 26,764,768 0.1900 19,309,366 0.1347
-------------------------- ------------- ----------------- ------------ ------------------
2017 2016
-------------------------------------------------- ----------------------------------------------------
Weighted Weighted Weighted Weighted
Weighted average average Weighted average average
Range average remaining remaining average remaining remaining
of exercise exercise life life exercise life life
prices price Number expected contracted price Number expected contracted
(GBP) (GBP) of shares (years) (years) (GBP) of shares (years) (years)
------------ ---------- ----------- ------------ ----------- ---------- ----------- ----------- ------------
0 - 0.05 - - - - 0.37 3,625,000 2.20 2.20
0.05
- 2.00 0.1900 26,764,768 2.61 2.61 0.15 15,684,366 1.78 1.78
------------ ---------- ----------- ------------ ----------- ---------- ----------- ----------- ------------
During the period there was a charge of GBP119,439 (2016: GBP29,457) in respect of share options.
15. Other Reserves
Group
--------------------------------------------------------------------
Foreign currency
Merger translation Redemption Share option
reserve reserve reserve reserve Total
GBP GBP GBP GBP GBP
---------------------- --------- ----------------- ----------- ------------- ----------
At 30 June 2016 166,000 114,891 36,463 153,346 470,700
---------------------- --------- ----------------- ----------- ------------- ----------
Currency translation
differences - 694,161 - - 694,161
Issued options - - - 119,439 119,439
Exercised options - - - (163,203) (163,203)
---------------------- --------- ----------------- ----------- ------------- ----------
At 31 December
2017 166,000 809,052 36,463 109,582 1,121,097
---------------------- --------- ----------------- ----------- ------------- ----------
Company
---------------------------------------------------
Merger Redemption Share option
reserve reserve reserve Total
GBP GBP GBP GBP
--------------------- --------- ----------- ------------- ----------
At 30 June 2016 166,000 36,463 153,346 355,809
--------------------- --------- ----------- ------------- ----------
Issued options - - 119,439 119,439
Exercised options - - (163,203) (163,203)
--------------------- --------- ----------- ------------- ----------
At 31 December 2017 166,000 36,463 109,582 312,045
--------------------- --------- ----------- ------------- ----------
16. Employee benefit expense
Group Company
-------------------------- --------------------------
Period ended Year ended Period ended Year ended
31 December 30 June 31 December 30 June
2017 2016 2017 2016
Staff costs (excluding Directors) GBP GBP GBP GBP
----------------------------------- ------------- ----------- ------------- -----------
Salaries and wages 242,059 134,781 216,984 19,831
Social security costs 18,656 3,679 16,476 -
Retirement benefit costs 700 40,018 700 -
----------------------------------- ------------- ----------- ------------- -----------
261,415 178,478 234,160 19,831
----------------------------------- ------------- ----------- ------------- -----------
The average monthly number of employees for the Group during the period was 11 (30 June 2016: 6) and the average monthly number of employees for the Company was 6 (30 June 2016: 3).
Of the above Group staff costs, GBP135,513 (30 June 2016: GBP169,846) has been capitalised in accordance with IFRS 6 as exploratory related costs and are shown as an intangible addition in the period.
17. Directors' Remuneration
Period ended 31 December 2017
Short-term Post-employment Share based
benefits benefits payments Total
GBP GBP GBP GBP
------------------------ ---------- ------------------ ------------ ---------
Executive Directors
Roderick McIllree 34,524 106 - 34,630
Non-executive Directors
Greg Kuenzel 49,328 109 - 49,437
Graham Marshall (1) - - - -
Peter Waugh 12,328 94 6,278 18,700
Michael Hutchinson 8,334 - 5,795 14,129
104,514 309 12,073 116,896
---------- ------------------ ------------ ---------
Of the above Group Directors Remuneration, GBP18,075 (30 June 2016: GBP19,865) has been capitalised in accordance with IFRS 6 as exploratory related costs and are shown as an intangible addition in the period.
Year ended 30 June 2016
---------------------------------------------------------
Post-employment Share based
Short-term benefits benefits payments Total
GBP GBP GBP GBP
------------------------ ------------------- --------------- ----------- ------
Executive Directors
Roderick McIllree 11,370 - - 11,370
Non-executive Directors
Greg Kuenzel 12,000 - - 12,000
Graham Marshall (1) - - - -
Peter Waugh - - - -
Michael Hutchinson - - - -
23,370 - - 23,370
------------------- --------------- ----------- ------
(1) Graham Marshall resigned on 16 October 2017
Details of fees paid to Companies and Partnerships of which the Directors detailed above are Directors and Partners have been disclosed in Note 25.
The remuneration of directors and key executives is determined by the remuneration committee having regard to the performance of individuals and market trends.
18. Finance Income
Group
-------------------------------
Year ended
Period ended 30 June
31 December 2017 2016
GBP GBP
-------------------------------------- ------------------ -----------
Interest received from cash and cash
equivalents 1,717 250
-------------------------------------- ------------------ -----------
Finance Income 1,717 250
-------------------------------------- ------------------ -----------
19. Income Tax Expense
No charge to taxation arises due to the losses incurred.
The tax on the Group's loss before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to the losses of the consolidated entities as follows:
Group
-----------------------------
Period ended
31 December Year ended
2017 30 June 2016
GBP GBP
------------------------------------------ ------------- --------------
Loss before tax (2,680,708) (620,059)
------------------------------------------ ------------- --------------
Tax at the applicable rate of 21.82%
(2016: 19.20%) (584,943) (119,065)
Effects of:
Expenditure not deductible for tax
purposes 5,120 1,401
Depreciation in excess of/(less than)
capital allowances (593) 967
Net tax effect of losses carried forward 580,416 116,696
------------------------------------------ ------------- --------------
Tax charge - -
------------------------------------------ ------------- --------------
The weighted average applicable tax rate of 21.82% (2016: 19.20%) used is a combination of the 19% standard rate of corporation tax in the UK, 20% Finnish corporation tax, 25% Austrian corporation tax and 30% Greenlandic corporation tax.
The Group has a potential deferred income tax asset of approximately GBP2,079,073 (2016: GBP1,498,657) due to tax losses available to carry forward against future taxable profits. The Company has tax losses of approximately GBP5,067,761 (2016: GBP4,752,742) available to carry forward against future taxable profits. No deferred tax asset has been recognised on accumulated tax losses because of uncertainty over the timing of future taxable profits against which the losses may be offset.
20. Earnings per Share
Group
The calculation of the total basic earnings per share of (0.408) pence (30 June 2016: (0.172) pence) is based on the loss attributable to equity holders of the parent company of GBP2,680,708 (30 June 2016: GBP613,849) and on the weighted average number of ordinary shares of 656,936,094 (30 June 2016: 357,925,047) in issue during the period.
In accordance with IAS 33, basic and diluted earnings per share are identical for the Group as the effect of the exercise of share options would be to decrease the earnings per share.
Details of share options that could potentially dilute earnings per share in future periods are set out in Note 14.
21. Expenses by nature
Group
-----------------------------
Period ended
31 December Year ended
2017 30 June 2016
GBP GBP
------------------------------------- ------------- --------------
Directors' fees 81,914 3,505
Employee salaries 211,175 8,632
AIM related costs (including Public
Relations) 461,770 164,811
Establishment expenses 111,308 30,000
Auditor remuneration 57,981 16,000
Auditor fees for other services 127,096 1,000
Travel & subsistence 160,549 60,787
Professional & consultancy fees 496,622 253,783
Insurance 57,102 17,238
Depreciation 46,868 5,037
Share Option expense 119,439 -
Other expenses 179,488 68,253
------------------------------------- ------------- --------------
Total administrative expenses 2,111,312 629,046
------------------------------------- ------------- --------------
Services provided by the Company's auditor and its associates
During the period, the Group (including overseas subsidiaries) obtained the following services from the Company's auditors and its associates:
Group
--------------------------
Period ended Year ended
31 December 30 June
2017 2016
GBP GBP
------------------------------------------------ ------------- -----------
Fees payable to the Company's auditor and
its associates for the audit of the Parent
Company and Consolidated Financial Statements 44,500 16,000
Fees payable to the Company's auditor for
tax compliance & other services 92,235 1,000
------------------------------------------------ ------------- -----------
22. Commitments
(a) Royalty agreements
As part of the contractual arrangement with Magnus Minerals Limited ('Magnus') the Group has agreed to pay royalties on revenue from mineral sales arising from mines developed by the Group. Under the terms of the respective Royalty Agreements between Magnus and the Company, the Group shall pay the following:
-- 0.5% of net smelter returns over mineral production from the Kainuu Schist Belt tenements;
-- 1.0% of net smelter returns over mineral production from the Outokumpu Savonara Mine Belt tenements;
-- 1.5% of net smelter returns over mineral production from the Enonoski Area tenements; and -- 2.5% of net smelter returns over mineral production from the Hammaslahti Area tenements.
The Enonoski and Hammaslahti Royalty Agreements further provide that royalty entitlements may be extended to future rights with the respective areas of influence defined with the agreements.
Additionally, under the terms of the Kainuu Schist Belt Royalty Agreement and the Outokumpu Savonara Mine Belt Royalty Agreement the Group is obligated to pay SES Finland Limited a 0.5% net smelter royalty in respect of production from the associated tenements and Western Areas Limited ("Western Areas") 0.5% of net smelter returns over mineral production of the tenements using a biological leaching technology owned by Western Areas.
(b) License commitments
Bluejay now owns 4 mineral exploration licenses in Greenland. Licence 2015/08 was acquired via the acquisition of BJ Mining Limited in 2016. On 4 January 2017, via the acquisition of Disko Exploration Limited, the Group acquired another 2 mineral exploration licenses, 2011/31 and 2012/29 in Greenland. These licences include commitments to pay annual licence fees and minimum spend requirements.
As at 31 December 2017 these are as follows:
Group
------------------------------------
Group License Minimum spend
fees requirement Total
GBP GBP GBP
--------------------------------------- -------- -------------- ----------
Not later than one year 114,792 334,438 449,230
Later than one year and no later than
five years 271,910 2,637,800 2,909,710
--------------------------------------- -------- -------------- ----------
Total 386,702 2,972,238 3,358,941
--------------------------------------- -------- -------------- ----------
(c) Operating lease commitments
The Group leases office premises under a non-cancellable operating lease agreement. The lease is on an initial fixed term of two years from 31 July 2017. The lease expenditure charged to the Income Statement during the period is disclosed in Note 21 and is included within establishment expenses.
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
Group
----------------------
31 December 30 June
2017 2016
GBP GBP
--------------------------------------------- ------------ --------
Not later than one year 60,000 36,000
Later than one year but not later than five
years 35,000 -
--------------------------------------------- ------------ --------
Total lease commitment 95,000 36,000
--------------------------------------------- ------------ --------
23. Contingent liabilities
The Directors are in the process of appealing an assessment made by HMRC which relates to the Company's ability to claim input VAT because, in the view of HMRC, the Company does not technically constitute a business for the purposes of VAT and is not eligible to make such claims in connection with services it supplied to the Company's subsidiaries. The initial assessment raised by HMRC is for an amount of GBP255,492 and relates to input VAT claimed and repaid by HMRC between 2012-2015. At the point the assessment was raised, HMRC ceased to repay any further claims for input VAT made by the Company. The Company has continued to submit the appropriate returns to HMRC and as a result, the Company has a receivable from HMRC of GBP287,731 at 31 December 2017 which is included within trade and other receivables. HMRC has made a further protective assessment for this amount, bringing the total amount of the dispute at 31 December 2017 to GBP543,223.
The Directors strongly refute the view of HMRC that the Company does not constitute a business for VAT purposes. The case is proceeding to Tribunal and resolution is not expected any earlier than Q4 2018. The Company has engaged professional services of legal counsel who will be representing it before the Tribunal. Counsel confirms the Company has a strong case.
Accordingly, the Directors believe that the amount of GBP543,223 will be recovered in full and therefore have not recognised any impairment to the carrying value of this amount.
24. Business Combinations
i) Disko Exploration Limited (formerly Avannaa Exploration Limited)
On 4 January 2017, the Group acquired 100% of the share capital of Disko Exploration Limited ('Disko') for GBP500,000. Disko is registered in United Kingdom and holds 3 mineral exploration licences in Greenland. As a result of this acquisition the Group is expected to increase its presence in this market and commodity.
The following tables summarise the nature of the acquisition, the consideration paid for Disko and the amounts of the assets acquired and liabilities assumed recognised at the acquisition date.
Disko was acquired so as to continue the expansion of the Group's operations in the exploration of mineral assets in Greenland.
Consideration at 4 January 2017 GBP ------------------------------------------------ -------- Equity instruments (76,428,572 ordinary shares at 6.59262 pence per share) 500,000 ------------------------------------------------- -------- Total consideration 500,000 ------------------------------------------------- --------
Acquisition related costs amounting to GBP88,642 have been excluded from the consideration transferred and have been recognised in profit or loss in the current period.
Recognised amounts of identifiable assets
acquired and liabilities assumed Book value FV adj. Total
-----------------------------------------------
GBP
Cash and cash equivalents - - -
Exploration assets (included within Intangible
Assets) (Note 7) 9,193 613,509 622,702
Other identifiable assets and liabilities - - -
Deferred tax liability - (122,702) (122,702)
Total identifiable net assets 9,193 490,807 500,000
Goodwill -
Total consideration 500,000
The fair value of the 76,428,572 Ordinary Shares for the Company was based on the agreed price of 6.59262 pence and 0.001 pence per Ordinary Share respectively.
The fair value of the exploration assets of GBP500,000 was estimated by applying a number of valuation metrics which include; geological upside potential, mineralogy, market benchmarks and the application of local market factors. In the Directors' opinion, the value of the consideration paid to effect the acquisition related primarily to the value of the exploration licences and upside potential representing a price agreed between willing and knowledgeable parties on an arm's length basis. Therefore, the fair value of the consideration transferred, after consideration of tax implications and the removal of the fair value of other identifiable assets acquired, has been used as a basis for valuing the exploration assets acquired
Since 4 January 2017 Disko contributed a loss of GBP132,301. No revenue was recognised in the consolidated statement of comprehensive income in respect of Disko.
Had Disko been consolidated from 1 July 2016, the consolidated statement of income would show a loss of GBP187,310 and revenue would remain unchanged.
ii) BJ Mining Limited (formerly Bluejay Mining Limited) a) Initial acquisition in the year ended 30 June 2016
On 8 March 2016, the Group acquired 60.37% of the share capital of BJ Mining LImited ('BJM') for GBP905,607 (the 'BJM Acquisition'). BJM is registered in the British Virgin Islands and held a 126km sq. mineral exploration licence in Greenland. As a result of this acquisition the Group increased its presence in this market and commodity.
Gregory Kuenzel and Roderick McIllree were both shareholders in BJM and received consideration shares resulting from the BJM Acquisition. Refer to Note 25 for more details.
The following table summarises the consideration paid for BJM and the amounts of the assets acquired and liabilities assumed recognised at the acquisition date.
Consideration at 8 March 2016 GBP
Deferred Equity Consideration (40,755,885 ordinary shares
at 0.55 pence per share) 224,157
Equity instruments (123,900,000 ordinary shares at 0.55
pence per share) 681,450
Total consideration 905,607
Recognised amounts of identifiable assets
acquired and liabilities assumed Book value FV adj. Total
GBP
Cash and cash equivalents - - -
Exploration assets (included within
Intangible Assets) 46,171 1,866,715 1,912,886
Other identifiable assets and liabilities (37,165) - (37,165)
Deferred tax liability - (373,343) (373,343)
Total identifiable net assets 9,006 1,493,372 1,502,378
Goodwill -
Non-controlling interest (596,771)
Total consideration 905,607
The fair value of the 40,755,885 Ordinary Shares and 123,900,000 Ordinary shares issued as consideration for Bluejay was based on the agreed price of 0.55 pence and 0.0055 pence per Ordinary Share respectively.
The fair value of the exploration assets of GBP1,912,886 was estimated by applying a number of valuation metrics which include; geological upside potential, mineralogy, market benchmarks and the application of local market factors. In the Directors' opinion, the value of the consideration paid to effect the acquisition related primarily to the value of the exploration licences and upside potential representing a price agreed between willing and knowledgeable parties on an arm's length basis. Therefore, the fair value of the consideration transferred, after consideration of tax implications and the removal of the fair value of other identifiable assets acquired, has been used as a basis for valuing the exploration assets acquired.
b) Acquisition of NCI in the period ended 31 December 2017
On 10 March 2017, the Group acquired the remaining non-controlling interest ('NCI') in BJM (being 39.63% of the total shares in the Company). As a result the Group now owns 100% of the interest of BJM, consolidating its already controlling interest.
Consideration at 10 March 2017 GBP Cash - Equity instruments (108,071,388 ordinary shares at 0.55 pence per share) 594,393 Total consideration 594,393
The consideration equalled the value of the NCI held at the date of acquisition.
25. Related Party Transactions
Loans to Group undertakings
Amounts receivable as a result of loans granted to subsidiary undertakings are as follows:
Company
-----------------------
31 December 30 June
2017 2016
GBP GBP
----------------------------- ------------
Centurion Universal Limited - 564,300
Centurion Resources GmbH - 85,155
Finland Investments Ltd 310,452 289,153
FinnAust Mining Finland Oy 5,087,869 3,515,060
Centurion Mining Limited 195 195
BJ Mining Limited 1,155,963 445,802
Dundas Titanium A/S 3,256,326 -
Disko Exploration Limited 207,067 -
----------------------------- ------------
At 31 December (Note 8) 10,017,871 4,899,665
----------------------------- ------------
The loans due from Centrurian Universal Limited and Centurian Resources GmbH were impaired during the period in line with the impairment to the Austrian exploration assets following the Directors impairment assessment.
Loans granted to subsidiaries have increased during the period due to additional loans being granted to the subsidiaries, and foreign exchange losses of GBP338,674, given that no loans were repaid during the period.
These amounts are unsecured, interest free and repayable in Euros when sufficient cash resources are available in the subsidiaries.
All intra Group transactions are eliminated on consolidation.
Other Transactions
The Group defines its key management personnel as the Directors of the Company as disclosed in the Directors' Report.
Heytesbury Corporate LLP, a limited liability partnership of which Gregory Kuenzel is a partner, was paid a fee of GBP126,000 for the 18 month period ended 31 December 2017 (12 months to 30 June 2016: GBP84,000) for the provision of corporate management, accounting and consulting services to the Company. There was no balance outstanding at the period-end.
RM Corporate Limited (formerly Tabasco Consulting Limited), a limited company of which Roderick McIllree is a director, was paid a fee of GBP97,500 for the 18 month period ended 31 December 2017 (12 months to 30 June 2016: GBP55,930) for the provision of corporate management and consulting services to the Company. There was no balance outstanding at the period-end.
Greenland Gas & Oil Limited, a limited company of which Roderick McIllree and Gregory Kuenzel are directors, was paid a fee of GBP45,400 for the 18 month period ended 31 December 2017 (12 months to 30 June 2016: GBP9,300) for geological information systems consulting services to the Company. There was no balance outstanding at the period-end.
JW Geological Limited, a limited company of which Jeremy Whybrow,is a director, was paid a fee of GBP63,988 for the 18 month period ended 31 December 2017 (12 months to 30 June 2016: GBP20,000) for consulting services to the Company. Jeremy Whybrow is a substantial shareholder of the Company. There was no balance outstanding at the period-end.
Gregory Kuenzel, had a balance of GBP41,662 outstanding to the Company (2016: GBPnil) for exercise of option funds in the 2017 period which was paid subsequent to year end.
26. Ultimate Controlling Party
The Directors believe there is no ultimate controlling party.
27. Events after the Reporting Date
On 1 February 2018 the Company raised GBP17,000,000 via the issue and allotment of 77,272,728 new ordinary shares of 0.0001 pence each fully paid at a price of 22 pence per share.
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.
**S**
Further Information
For further information on Bluejay Mining plc please visit http://www.titanium.gl or contact one of the following:
Roderick McIllree Bluejay Mining plc +44 (0) 20 7907 9326
SP Angel Corporate Finance
Ewan Leggat LLP +44 (0) 20 3470 0470
SP Angel Corporate Finance
Soltan Tagiev LLP +44 (0) 20 3470 0470
Hannam & Partners (Advisory)
Ingo Hofmaier LLP +44 (0) 20 7907 8500
Hannam & Partners (Advisory)
Andrew Chubb LLP +44 (0) 20 7907 8500
Charlotte Page St Brides Partners Ltd +44 (0) 20 7236 1177
Susie Geliher St Brides Partners Ltd +44 (0) 20 7236 1177
Notes
Bluejay is dual listed on the London AIM market and Frankfurt Stock Exchange and primarily focussed on advancing the Dundas Ilmenite Project in Greenland into production in the near term. Dundas has been proven to be the highest-grade mineral sand ilmenite project globally, with a JORC Compliant Resource of 96 million tonnes at 6.9% ilmenite (in situ) and an Exploration Target over the Iterlak Delta of between 20 million tonnes and 60 million tonnes at between 6% and 10% ilmenite (in-situ) (see full Mineral Resource Statement below).
The Company's strategy is focused on securing an offtake partner and commencing commercial production at Dundas in the near term in order to create a company capable of self-funding exploration on current projects and future acquisitions.
Bluejay holds two additional projects in Greenland - the 2,586 sq km Disko-Nuussuaq ('Disko') Magmatic Massive Sulphide ('MMS') nickel-copper-platinum project ('Ni-Cu-PGM'), which has shown its potential to host mineralisation similar to the world's largest nickel/copper sulphide mine Norilsk-Talnakh, and the 107sq km Kangerluarsuk Sed-Ex lead-zinc-silver project ('Kangerluarsuk'), where historical work has recovered grades of 41% zinc, 9.3% lead and 596 g/t silver and identified four large-scale drill ready targets.
The Company also has a 100% interest in a portfolio of copper, zinc and nickel projects in Finland. This multi-commodity portfolio has been restructured to be cost-sustainable whilst determining the best plan for future development.
The Dundas Mineral Resource Statement has been reported at a 0% cut-off grade using the terminology and guidelines set out in the JORC 2012 Code.
Classification Location Tonnes Density >5mm >2mm <63<MU>m In-Situ In-Situ
(Mt) (T/m(3) (%) (%) (%) Total TiO(2)
) Heavy (%)
Minerals
(%)
Indicated Moriusaq 81.0 2.12 27.8 36.6 4.6 23.8 2.9
Inferred Moriusaq 7.0 2.12 15.4 23.3 5.7 34.1 4.4
Iterlak West 1.0 23.8 30.5 6 25.2 2.9
Iterlak East 7.0 14.6 23.1 5.6 39.4 5.8
Total Inferred 15.0 2.12 15.7 23.8 5.7 35.7 4.9
TOTAL RESOURCES 96,0 2.12 25.8 34.5 4.8 25.7 3.3
-- In situ TiO(2) conversion to in situ ilmenite is calculated by dividing the TiO(2) by 0.4765
-- Heavy Minerals have been separated from a -2 mm +63 um size fraction using heavy liquid separation at a density of 2.95 g/cm3
-- Mineralogical assessments indicate that ilmenite is the only mineral of value in the assemblage. The remainder of the heavy minerals is dominated by pyroxene and amphibole.
-- % TiO(2) in-situ assumes that all recoverable TiO(2) is in the heavy mineral component of the -2 mm +63 um size fraction
-- % Ilmenite In-situ assumes that all TiO(2) is within ilmenite and that the ilmenite contains 47.65% TiO(2) , based on historical exploration data
Qualified Persons
The information in this announcement that relates to Exploration Target or Mineral Resource is based on information compiled by Jeremy Whybrow, Chief Geologist of the Company and who is a Member of the Australian Institute of Geoscientists.
Mr Whybrow has sufficient experience, relevant to the style of mineralisation and type of deposit under consideration and to the activity which the Company is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' and a qualified person as defined in the Note for Mining and Oil & Gas Companies which form part of the AIM Rules for Companies. Mr Whybrow has reviewed this announcement and consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears.
Technical Glossary
"Indicated Mineral A part of a Mineral Resource for which tonnage, densities,
Resource" shape, physical characteristics, grade and mineral content
can be estimated with a reasonable level of confidence.
It is based on exploration, sampling and testing information
gathered through appropriate techniques from locations
such as outcrops, trenches, pits, workings and drill
holes. The locations are too widely or inappropriately
spaced to confirm geological and/or grade continuity
but are spaced closely enough for continuity to be assumed.
"Inferred Mineral A part of a Mineral Resource for which tonnage, grade
Resource" and mineral content can be estimated with a low level
of confidence. It is inferred from geological evidence
and assumed but not verified geological and/or grade
continuity. It is based on information gathered through
appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes which may be
limited or of uncertain quality and reliability. mineral
content can be estimated with a low level of confidence.
It is inferred from geological evidence and assumed
but not verified geological and/or grade continuity.
It is based on information gathered through appropriate
techniques from locations such as outcrops, trenches,
pits, workings and drill holes which may be limited
or of uncertain quality and reliability.
"Exploration An Exploration Target is a statement or estimate of
Target" the exploration potential of a mineral deposit in a
defined geological setting where the statement or estimate,
quoted as a range of tonnes and a range of grade (or
quality), relates to mineralisation for which there
has been insufficient exploration to estimate a Mineral
Resource.
"JORC Code" The code for reporting of the Australasian Joint Ore
Reserves Committee, which is sponsored by the Australian
mining industry and its professional organisations.
The code is widely accepted as a standard for professional
reporting purposes for reporting of mineral resources
and ore reserves.
"m" Metre, a unit of length as per the International System
of Units.
"Mineral Resource" A concentration or occurrence of material of intrinsic
economic interest in or on the Earth's crust in such
form, quality and quantity that there are reasonable
prospects for eventual economic extraction. The location,
quantity, grade, geological characteristics and continuity
of a Mineral Resource are known, estimated or interpreted
from specific geological evidence and knowledge. Mineral
Resources are sub-divided, in order of increasing geological
confidence, into Inferred, Indicated and Measured categories.
"Mineralisation" The process or processes by which a mineral is introduced
into a rock, resulting in a valuable or potentially
valuable deposit. It is a general term, incorporating
various types; e.g., fissure filling, impregnation,
and replacement.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
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