Goldstone Resources Ltd Interim Results (5064A)

TIDMGRL

RNS Number : 5064A

Goldstone Resources Ltd

30 September 2020

30 September 2020

GOLDSTONE RESOURCES LIMITED

("GoldStone" or the "Company")

Interim Results for the six months ended 30 June 2020

GoldStone Resources Limited (AIM: GRL), the AIM quoted company focused on gold in West and Central Africa, announces its unaudited interim results for the six-month period ended 30 June 2020.

Overview

-- Continued advancement of the Akrokeri-Homase Gold Project ("AKHM") in the highly prospective Ashanti Region of Ghana

-- Formal approval by the Ghanaian Ministry of Lands and Natural Resources of a 10 year mining lease on Akrokeri and Homase Licences, an important step in the Company's goal of bringing AKHM into production, expected before year end

-- A total of US$4.3 million raised during the period, to finance the commencement of production at Homsa South within AKHM

   --        Net assets increased to US$9.9 million (31 December 2019: US$6.9 million) 

Post Period

-- Formal approval received from the Ghanaian Ministry of Mines for the transfer of the Homase prospecting licence to GoldStone Akrokeri Limited, GoldStone's wholly owned Ghanaian subsidiary

-- Definitive Economic Plan extended and updated to bring in line with current gold prices and a reduction of initial CAPEX, with the combined effect of increasing the estimated project NPV to US$34.5 million

-- Continue to work closely with the Ghanaian Minerals Commission and the Environmental Protection Authority to finalise the necessary permits, including the environmental permit, so that on receipt of all relevant permits, mining operations can immediately commence

For further information, please contact:

   GoldStone Resources Limited                        Tel: [phone] 

Emma Priestley

Strand Hanson Limited

   Richard Tulloch / James Bellman                    Tel: [phone] 
   SI Capital Limited                                          Tel: [phone] 

Nick Emerson

This announcement contains inside information for the purposes of the market abuse regulation (EU No. 596/2014) ("MAR").

Chairman's Statement

Our transition towards advancing the Akrokeri-Homase Gold Project ("AKHM") to become a gold producer remains Goldstone's priority and significant progress was made in this regard during H1 2020.

A major development during the period H1 2020, was the formal approval, by the Ghanaian Ministry of Lands and Natural Resources ("MLNR"), of a 10 year mining lease on the Akrokeri and Homase licences, for the Homase South Pit and land for the associated plant and processing operations. This lease may be renewed and/or extended to include additional pits along the Homase Trend and the Company is pleased to report that the Ghanaian Minerals Commission has encouraged the Company to expand the lease to encompass the proposed Homase Central and North Pits along the Homase Trend and the Company is in the process of submitting such an application .

The second critical element required to move forward and into production was securing the requisite financing, and we were delighted to announce in March 2020 that the Company has raised US$4.3 million, gross, of funding to bring AKHM into production. US$1.3 million of this funding was by way of unsecured bond notes to certain new and existing investors (including major strategic investors Paracale Gold Limited ("Paracale") and BCM Investments Limited ("BCM")) (the "Bonds") with the remaining US$3.0 million by way of a gold loan of up to 2,000 troy ounces from Asian Investment Management Services Ltd ("AIMS") (the "Gold Loan"). To date the Company has drawn down the Bond Notes in full and has received, in aggregate, US$2.775 million under the Gold Loan. This funding has allowed the Company to invest in the necessary plant and equipment so that the Company is ready to commence operations immediately upon the award of the requisite permits.

The Company is awaiting the issue of certain permits, including the environmental permit, which are in the process of being finalised. On receipt of the permits, the Company will be able to immediately commence production and the Board continues to believe that it will be able to achieve first gold production before the year end.

Post the period end, we have also received the formal approval from the Ghanaian Ministry of Mines for the transfer of the Homase prospecting licence from Cherry Hill Mining Limited ("Cherry Hill") to GoldStone Akrokeri Limited ("GAL"), GoldStone's wholly owned Ghanaian subsidiary.

This transfer instigated the Company to evaluate the potential for increasing the mineable resource at depth at the Homase South Pit, and to this end an RC drilling programme was completed in August 2020 with 22 holes for 2,443 metres. We are awaiting the assay results from the laboratory, though they have delayed due to the current COVID 19 restrictions on businesses in Ghana.

The Company is also considering an additional drilling programme within the Homase Trend, extending approximately 2,000 metres northwards from the historic Homase Main Pit, encompassing the proposed Homase Central and North Pits, being the other two open pits defined in the Definitive Economic Plan ("DEP") for AKHM announced in June 2019. The intention is to seek to further define and extend the mineable resource down to a vertical depth of 60 metres, currently defined to a depth of 30 metres, for all three proposed pits, to further enhance the already attractive fundamentals which we believe are achievable at AKHM.

Post the period end, the Company announced, on 17 July 2020, that it had updated the financial model utilised for the DEP, to bring it in line with the then current gold price of approximately US$1,800/oz (versus US$1,300/oz used in the initial DEP) and to capture a reduced initial CAPEX of US$3.0 million (versus US$6.9 million in the DEP). This reduced initial CAPEX approach enables the Company to achieve first production within the timetable envisaged in the DEP whilst deferring certain elements of the project (including the elution plant, electrowinning and Gold Room), such that they can be funded from production cashflows. The combined effect of an increase in the gold price and the reduction in initial capital outlay is estimated by the Board to increase the originally estimated project NPV from US$19.5 million to US$34.5 million and the IRR from 143% to 382% (at a 10% discount rate and excluding financing costs).

Clearly these are truly exceptional potential returns for Goldstone, which further underpin the value of our AKHM project. It is with this in mind that I look forward to reporting further news in due course as we look to finalise the environmental permit and move towards first gold.

Once again, I would like to take this opportunity to thank the whole GoldStone team and our partners, and of course our shareholders for their continued support.

William (Bill) Trew

Non Executive Chairman

Chief Executive Officer's Report

Operational Update

H1 2020 has seen further crucial elements come together, as we look to realise our ambition of becoming a West African focussed gold producer.

As shareholders will be aware, our immediate target for mining is the Homase South Pit, the first of the three open pits planned to be brought into production as detailed in the AKHM DEP. The Homase South Pit extends 1,500 metres southwards from the historic Homase Main Pit, see Figure 1, which produced 52,500 oz gold at an average grade of 2.5g/t Au in 2002/03 by AngloGold Ashanti.

As previously reported, it is over the Homase South Pit that we have been issued with a 10 year mining lease, and land for the plant and process operation, by the MLNR. Whilst the lease initially only relates to the Homase South Pit, the DEP has been approved by the relevant authorities in Ghana in its entirety and the lease can therefore be renewed and/or extended to include additional pits along the Homase Trend as the Company's production plans advance. Having now received the formal approval from the Ministry of Mines for the transfer of the Homase prospecting licence from Cherry Hill to GAL, GoldStone's wholly owned Ghanaian subsidiary, the Ghanaian Minerals Commission encouraged the Company to expand its mining lease area. The Company is in the process of submitting an application to expand the area included in the mining lease to include the Central and North pits along the Homase Trend.

The Company continues to work closely with the Ghanaian Minerals Commission and the Environmental Protection Authority to finalise the necessary permits, including the environmental permit. Following securing the funding to bring Homase South into production, the Company has invested in the plant and equipment, the land and crop compensation, and the identification of contractors to undertake the mining, so that on receipt of the relevant permits, the Company will be able to immediately commence mining operations at the Homase South Pit, utilising contract mining, and construct the heap leach plant. The Company will be managing and implementing the plant construction and building the heap leach pads itself.

In parallel with the activities the Company has undertaken to progress towards first gold at the Homase South Pit, the team have also completed a resource expansion programme to further define and extend the mineable resource down-dip at Homase South to a vertical depth of approximately 60 metres and is currently awaiting the results from the drilling. As defined in the DEP, the Homase South Pit is currently targeting the oxide resource to a vertical depth of 30 metres. The programme seeks to build on previous drilling completed by Goldstone in 2011-2012, which defined the Company's existing JORC resource, and which indicated increased grades in this area of 1.4g/t to 2.5g/t below the weathered zone of 30 metres.

The Company is also considering an additional drilling programme within the Homase Trend, extending northwards, by approximately 2,000 metres from the historic Homase Main Pit, encompassing the proposed Homase Central and North Pits, being the other two open pits defined in the DEP, see Figure 1, and the former exploration pit, to the same depth of 60 metres, to seek to further increase the mineable resource defined within the DEP.

Figure 1: Location of the proposed mines

http://www.rns-pdf.londonstockexchange.com/rns/5064A_1-2020-9-29.pdf

Aside from our activities on the Homase Trend, being the initial area of intended mining, work continues to re-open the historic Akrokeri Mine, our developments are focused on re-accessing the old workings at the mine, and the company intends to commence a drilling programme to start to define a resource associated with the Akrokeri mineralisation with the intention of bringing the Akrokeri mine back into production.

Corporate & Financial Overview

In March 2020, the Company announced that it had secured funding of up to US$4.3 million to support GoldStone commencing production at AKHM and which was completed in June 2020, with the finalisation of the Gold Loan. The key terms of the funding are set out below:

-- Issue of twenty six 14% unsecured bond notes of US$50,000 each to certain existing and new investors, to raise, in aggregate, US$1.3 million (c.GBP1.0 million) (the "Bonds") before expenses

- Paracale Gold and BCM each subscribed for Bonds with a value of US$0.3 million respectively

- 52 million warrants, exercisable at 3 pence per ordinary share of 1 penny each in the Company ("Ordinary Share") (the "Exercise Price"), issued to the Bond subscribers

- Commission of 3% paid to Bond holders

-- Issue of 14% secured gold loan of up to 2,000 troy ounces of gold at a price of US$1,500 per troy ounce, equating to a value of US$3.0 million (c.GBP2.4 million) before expenses to AIMS

- 200 troy ounces (US$300,000) was drawn in March 2020

- 500 troy ounces (US$750,000) was drawn in June 2020

- 1,150 troy ounces (US$1,725,000) drawn post the period end

- 120 million warrants, exercisable at 3 pence per ordinary share of 1 penny each in the Company ("Ordinary Share") (the "Exercise Price"), issued to AIMS

Losses for the six months to 30 June 2020 were approximately US$0.3 million (30 June 2019: Loss of US$0.3 million). The financial statements at the period end show the Group's balance sheet, with net assets standing at US$9.9 million against net assets of US$6.9 million as at 31 December 2019. The net assets increased as result of the funding secured during the period, with the warrants issued in respect of the Bonds and Gold Loan, resulting in an increase in the share option reserve of US$3.3 million.

Having secured funding of US$4.3 million during the H1 2020, of which US$2.4 million had been drawn down to fund the purchase of equipment and general working capital, the Company had cash and cash equivalents of approximately US$0.5 million as at 30 June 2020 (30 June 2019: US$0.1 million). Following the period end, the Company has drawn down a further US$1.725 million and following the purchase of plant and equipment ahead of commencing mining operations, the Company currently has cash and cash equivalents of approximately US$0.9 million as at 25 September 2020, with a further US$0.225 million still available to be draw down under the Gold Loan.

As announced on 26 March 2020, agreement was reached with Cherry Hill, pursuant to which Cherry Hill relinquished its remaining 10% interest in the Homase prosecting licence in exchange for a 2% royalty of gold sales generated, less all costs and taxes and duties in accordance with the joint venture agreement. Post the period end and following approval from the Ghanaian Ministry of Mines, this licence has now been transferred to GAL.

Other

Following a claim against the Company, brought by a former director (initially announced on 13 October 2016), it was further announced in December 2018 that the South African Labour Court had ruled in favour of the former director and awarded him damages of US$140,000 plus interest and legal costs. The Company reserves its position, though has made provision for this in the financial statements and in October 2019 agreed temporary payment terms with further settlement discussions ongoing following advice from the Company's lawyer.

Following an administrative error in 2019 that led to the Company's Jersey registration being dissolved, trading in GoldStone's Ordinary Share on AIM was temporary suspended in April 2020. The Company was restored to the Jersey Registrar of Companies on 11 June 2020, with the dissolution of the Company having been voided, by the Royal Court of Jersey, which has the effect of the dissolution effectively never having taken place, enabling the resumption of trading in the Company's shares on AIM.

Outlook

We have made significant progress over recent months, having been awarded the mining lease and securing the requisite funding, and, despite some delays relating to the issue of the environmental permit, we are now in a position to immediately commence mining operations on its award.

I look forward to keeping shareholders updated as we move towards production and would like to thank the team, my fellow Board members and all of our stakeholders in Ghana and internationally for their continued support.

Emma Priestley

Chief Executive Officer

Consolidated statement of financial position

as at 30 June 2020

 
                                                30 June       30 June   31 December 
  in united states dollars          notes          2020          2019          2019 
                                              unaudited     unaudited       audited 
Assets 
property, plant and equipment                   407,198        29,822        24,314 
intangible assets - exploration 
 and evaluation                         6     9,927,752     8,070,448     8,256,380 
--------------------------------  -------  ------------  ------------  ------------ 
total non-current assets                     10,334,950     8,100,270     8,280,694 
--------------------------------  -------  ------------  ------------  ------------ 
 
trade and other receivables             7     3,380,488       196,494       162,864 
cash and cash equivalents                       505,462       136,748        90,128 
--------------------------------  -------  ------------  ------------  ------------ 
total current assets                          3,885,950       333,242       252,992 
--------------------------------  -------  ------------  ------------  ------------ 
 
  total assets                               14,220,900     8,433,512     8,533,686 
--------------------------------  -------  ------------  ------------  ------------ 
 
  Equity 
share capital - ordinary 
 shares                                       3,484,580     3,480,430     3,484,580 
share capital - deferred 
 shares                                       6,077,013     6,077,013     6,077,013 
share premium                                27,222,084    27,219,262    27,222,084 
foreign exchange reserve                       (70,114)             -      (52,061) 
capital contribution reserve                    555,110       555,110       555,110 
share options reserve                   7     3,535,197       229,688       229,688 
accumulated deficit                        (30,916,914)  (30,259,987)  (30,624,816) 
--------------------------------  -------  ------------  ------------  ------------ 
total equity                                  9,886,956     7,301,516     6,891,598 
--------------------------------  -------  ------------  ------------  ------------ 
 
  Liabilities 
borrowings                              7     2,368,992       781,523     1,168,997 
--------------------------------  -------  ------------  ------------  ------------ 
non-current liabilities                       2,368,992       781,523     1,168,997 
trade and other payables                        664,952       350,473       473,091 
borrowings                              7     1,300,000             -             - 
--------------------------------  -------  ------------  ------------  ------------ 
current liabilities                           1,964,952       350,473       473,091 
--------------------------------  -------  ------------  ------------  ------------ 
total liabilities                             4,333,944     1,131,996     1,642,088 
--------------------------------  -------  ------------  ------------  ------------ 
total equity and liabilities                 14,220,900     8,433,512     8,533,686 
--------------------------------  -------  ------------  ------------  ------------ 
 

Consolidated statement of comprehensive income

for the 6 months ended 30 June 2020

 
                                          6 months ended  6 months ended    year ended 
                                            30 June 2020    30 June 2019   31 December 
  in united states dollars         notes                                          2019 
                                               unaudited       unaudited       audited 
continuing operations 
administrative expenses                        (266,156)       (276,071)     (542,559) 
-------------------------------  -------  --------------  --------------  ------------ 
operating loss                                 (266,156)       (276,071)     (542,559) 
-------------------------------  -------  --------------  --------------  ------------ 
finance income                                         -               6             - 
-------------------------------  -------  --------------  --------------  ------------ 
finance expense                                 (25,942)        (13,886)     (112,221) 
-------------------------------  -------  --------------  --------------  ------------ 
net finance cost                                (25,942)        (13,880)     (112,221) 

-------------------------------  -------  --------------  --------------  ------------ 
 
loss before and after tax 
 from continuing operations            5       (292,098)       (289,951)     (654,780) 
-------------------------------  -------  --------------  --------------  ------------ 
Items that may be reclassified 
 subsequently to profit and 
 loss: 
 foreign exchange translation 
 movement                                       (18,053)               -      (52,061) 
-------------------------------  -------  --------------  --------------  ------------ 
 
total comprehensive loss 
 for the period                                (310,151)       (289,951)     (706,841) 
-------------------------------  -------  --------------  --------------  ------------ 
loss per share from operations 
basic and diluted earnings 
 per share attributable to 
 the equity holders of the 
 company during the period 
 (expressed in cent per share)         4         (0.001)         (0.001)       (0.003) 
-------------------------------  -------  --------------  --------------  ------------ 
 

Consolidated statement of changes in equity

for the 6 months ended 30 June 2020

 
                      share       share                   Foreign 
                    capital     capital                  exchange        capital       share 
 in united         ordinary    deferred        share      reserve   contribution     options    accumulated         total 
 states dollars      shares      shares      premium                     reserve     reserve        deficit        equity 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 
 balance as at 
  1 January 
  2019            3,480,430   6,077,013   27,219,262            -        555,110     229,688   (29,970,036)     7,591,467 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 total 
  comprehensive 
  loss 
  for the 
  period                  -           -            -            -              -           -      (289,951)     (289,951) 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 balance as at 
  30 June 
  2019            3,480,430   6,077,013   27,219,262            -        555,110     229,688   (30,259,987)     7,301,516 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 total loss for 
  the period              -           -            -            -              -           -      (364,829)     (364,829) 
 translation 
  movement                -           -            -     (52,061)              -           -              -      (52,061) 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 total 
  comprehensive 
  loss 
  for the 
  period                  -           -            -     (52,061)              -           -      (364,829)     (416,890) 
 issue of 
  ordinary 
  shares              4,150           -        2,822            -              -           -              -         6,972 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 balance as at 
  31 December 
  2019            3,484,580   6,077,013   27,222,084     (52,061)        555,110     229,688   (30,624,816)     6,891,598 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 total loss for 
  the period              -           -            -            -              -           -      (292,098)     (292,098) 
 translation 
  movement                -           -            -     (18,053)              -           -              -      (18,053) 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 total 
  comprehensive 
  loss 
  for the 
  period                  -           -            -     (18,053)              -           -      (292,098)     (310,151) 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 share warrants 
  granted 
  in the period           -           -            -            -              -   3,305,509              -     3,305,509 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 balance as at 
  30 June 
  2020            3,484,580   6,077,013   27,222,084     (70,114)        555,110   3,535,197   (30,916,914)     9,886,956 
---------------  ----------  ----------  -----------  -----------  -------------  ----------  -------------  ------------ 
 

Consolidated statement of cash flow

for the 6 months ended 30 June 2020

 
                                                 6 months ended   6 months    year ended 
                                                        30 June      ended   31 December 
  in united states dollars                                 2020    30 June          2019 
                                                                      2019 
                                                      unaudited  unaudited       audited 
cash flow from operating activities 
operating loss for the period/year                    (266,156)  (289,951)     (542,559) 
adjusted for: 
 
        *    depreciation                                 5,152      5,632        11,140 
 
        *    finance income                                   -        (6)             - 
 
        *    finance expense                                  -     13,886             - 
 
        *    non settlement of directors' fees                -          -         6,972 
 
        *    foreign exchange differences              (18,053)          -      (52,061) 
changes in working capital: 
 
        *    trade and other receivables              (125,006)     33,194             - 
 
        *    trade and other payables                   215,914  (106,391)        15,827 
===============================================  ==============  =========  ============ 
net cash used in operating activities                 (188,149)  (343,636)     (560,681) 
===============================================  ==============  =========  ============ 
 
cash flow from investing activities 
finance income                                                -          6             - 
capitalisation of exploration costs                 (1,458,481)  (300,727)     (486,659) 
acquisition of property, plant and 
 equipment                                            (388,036)          -             - 
net cash used in investing activities               (1,846,517)  (300,721)     (486,659) 
===============================================  ==============  =========  ============ 
 
cash flow from financing activities 
proceeds from loan                                    1,150,000    443,637       800,000 
proceeds from bonds                                   1,300,000 
net cash received from financing 
 activities                                           2,450,000    443,637       800,000 
===============================================  ==============  =========  ============ 
 
net decrease in cash and cash equivalents               415,334  (200,720)     (247,340) 
-----------------------------------------------  --------------  ---------  ------------ 
cash and cash equivalents at beginning 
 of the period/year                                      90,128    337,468       337,468 
-----------------------------------------------  --------------  ---------  ------------ 
cash and cash equivalents at end 
 of the period/year                                     505,462    136,748        90,128 
-----------------------------------------------  --------------  ---------  ------------ 
 

Notes to the unaudited consolidated financial statement

   1.          General information 

The financial statements present the consolidated results of the Company and its subsidiaries (the "Group") for each of the periods ending 30 June 2020, 30 June 2019 and 31 December 2019.

As permitted, the Group has chosen not to adopt International Accounting Standard 34 'Interim Financial Reporting' in preparing these interim financial statements. The condensed consolidated interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2019, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

The unaudited interim financial information set out above does not constitute statutory accounts. The information has been prepared on a going concern basis in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) as adopted by the European Union. Except as described below, the accounting policies applied in preparing the interim financial information are consistent with those that have been adopted in the Group's 2019 audited financial statements. Statutory financial statements for the year ended 31 December 2019 were approved by the Board of Directors on 29 June 2020 and delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified. The Directors approved these unaudited condensed interim financial statements on 29 September 2020.

There are no IFRSs or IFRIC interpretations that are effective for the first time for the financial year commencing 1 January 2020 that would be expected to have a material impact on the Group.

The financial information for the 6 months ended 30 June 2020 and the 6 months ended 30 June 2019 have not been audited.

The business is not subject to seasonal variations. No dividends have been paid in the period (2019: US$ Nil).

   2.          Risks and uncertainties 

The key risks that could affect the Group's short and medium term performance and the factors that mitigate those risks have not substantially changed from those set out in the Group's 2019 Annual Report and Financial Statements, a copy of which is available on the Company's website: www.goldstoneresources.com . The Group's key financial risks are the availability of adequate funding and foreign exchange movements.

   3.          Critical accounting estimates and judgements 

The preparation of the unaudited condensed consolidated interim financial statements 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 end of the reporting period. Significant items subject to such estimates are set out in note 2(d) of the Group's 2019 Annual Report and Financial Statements. The nature and amounts of such estimates have not changed significantly during the interim period. The unaudited condensed consolidated interim financial statements have been prepared under the historical cost convention as modified by the measurement of certain investments at fair value.

   4.          Earnings per share 
 
                                    6 months ended  6 months ended    year ended 
                                           30 June         30 June   31 December 
  in united states dollars                    2020            2019          2019 
                                         unaudited       unaudited       Audited 
loss attributable to shareholders        (292,098)       (289,951)     (654,780) 
weighted average number 
 of ordinary shares                    250,050,253     249,707,991   249,846,584 
==================================  ==============  ==============  ============ 
basic and diluted earnings 
 per share                                 (0.001)         (0.001)       (0.003) 
==================================  ==============  ==============  ============ 
 
   5.          Operating segments 

The Group has two reportable segments, exploration and corporate, which are the Group's strategic divisions. For each of the strategic divisions, the Group's CEO, deemed to be the Chief Operating Decision Maker ("CODM"), reviews internal management reports on at least a monthly basis. The Group's reportable segments are:

Exploration and Evaluation: the exploration operating segment is presented as an aggregation of the Homase and Akrokeri licences (Ghana). Expenditure on exploration activities for each licence is used to measure agreed upon expenditure targets for each licence to ensure the licence clauses are met.

Corporate: the corporate segment includes the holding company costs in respect of managing the Group. There are varying levels of integration between the corporate segment and the combined exploration activities, which include resources spent and accounted for as corporate expenses that relate to furthering the exploration activities of individual licences.

information about reportable segments for the year ended 31 December 2019

 
 in united states dollars           exploration     corporate         total 
--------------------------------   ------------  ------------  ------------ 
 
 reportable segment expenditure               -     (654,780)     (654,780) 
=================================  ============  ============  ============ 
 
 reportable segment (loss)                    -     (654,780)     (654,780) 
=================================  ============  ============  ============ 
 
 reportable segment assets            8,321,000       212,686     8,533,686 
=================================  ============  ============  ============ 
 
 reportable segment liabilities        (32,314)   (1,609,774)   (1,642,088) 
=================================  ============  ============  ============ 
 

information about reportable segments for the period ended 30 June 2019

 
 in united states dollars           exploration     corporate         total 
--------------------------------   ------------  ------------  ------------ 
 
 reportable segment expenditure               -     (289,951)     (289,951) 
=================================  ============  ============  ============ 
 
 reportable segment (loss)                    -     (289,951)     (289,951) 
=================================  ============  ============  ============ 
 
 reportable segment assets            8,141,994       291,518     8,433,512 
=================================  ============  ============  ============ 
 
 reportable segment liabilities       (123,071)   (1,008,925)   (1,131,996) 
=================================  ============  ============  ============ 
 

information about reportable segments for the period ended 30 June 2020

 
 in united states dollars           exploration     corporate         total 
--------------------------------   ------------  ------------  ------------ 
 
 reportable segment expenditure               -     (292,098)     (292,098) 
=================================  ============  ============  ============ 
 
 reportable segment (loss)                    -     (292,098)     (292,098) 
=================================  ============  ============  ============ 
 
 reportable segment assets           10,601,550     3,619,350    14,220,900 
=================================  ============  ============  ============ 
 
 reportable segment liabilities        (36,130)   (4,297,814)   (4,333,944) 
=================================  ============  ============  ============ 
 
   6.          Intangible assets - exploration and evaluation 

The Group's intangible assets comprise wholly of exploration and evaluation assets in respect of the Homase-Akrokeri project in Ghana.

 
 in united states dollars               Total 
--------------------------------   ---------- 
 
 balance as at 31 December 2018     7,769,721 
=================================  ========== 
 
 Additions                            300,727 
 
 balance as at 30 June 2019         8,070,448 
=================================  ========== 
 
 Additions                            185,932 
 
 balance as at 31 December 2019     8,256,380 
=================================  ========== 
 
 additions                          1,671,372 
 
 balance as at 30 June 2020         9,927,752 
=================================  ========== 
 
   7.          Borrowings 
 
                             6 months ended  6 months ended    year ended 
                                    30 June         30 June   31 December 
  in united states dollars             2020            2019          2019 
                                  unaudited       unaudited       Audited 
shareholder loan                  1,306,507         781,523     1,168,997 
gold loan                         1,062,485               -             - 
---------------------------  --------------  --------------  ------------ 
non-current borrowings            2,368,992         781,523     1,168,997 
bonds                             1,300,000               -             - 
---------------------------  --------------  --------------  ------------ 
current borrowings                1,300,000               -             - 
===========================  ==============  ==============  ============ 
total borrowings                  3,668,992         781,523     1,168,997 
===========================  ==============  ==============  ============ 
 

Shareholder loan

The Company entered into a loan agreement with Paracale Gold Limited ("Paracale"), the Company's major shareholder, in December 2018, for a loan of up to US$1.2 million.

The loan accrues interest at 6.0% per annum, compounded daily against the loan's outstanding balance, until it is repaid. The total balance has been fully drawn as at 30 June 2020. The loan will be repaid in full on or before 2 June 2022.

In consideration of entering into the loan agreement, Paracale, were issued with 40,352,377 warrants to subscribe for such number of ordinary shares of 1 penny each in the capital of the Company ("Ordinary Shares") at an exercise price of 1.2p per share, at any time during the period through to 2 June 2022.

Gold Loan

The Company entered into a loan agreement with Asian Investment Management Services Limited ("AIMS") in June 2020, for a gold loan of up to 2,000 troy ounces of gold at a price of US$1,500 per troy ounce, equating to a value of US$3.0 million before expenses. An upfront payment of 200 troy ounces (US$300,000) was drawn in March 2020 with a further 500 troy ounces (US$750,000) drawn in June 2020 upon finalisation of the agreement. A further 1,150 troy ounces (US$1,725,000) has been drawn post the period end with a further 150 troy ounces (US$225,000) available to be drawn.

The Gold Loan accrues interest at 14.0% per annum, compounded daily against the loan's outstanding balance, until it is repaid. The Gold Loan will be repaid in full on or before 19 September 2021.

In consideration of entering into the loan agreement, AIMS were issued with 120,000,000 warrants to subscribe for such number of Ordinary Shares at an exercise price of 3.0p per share (the "Exercise Price"), at any time during the period through to 22 June 2022. This resulted in an increase in the share option reserve and other receivables of US$2.9 million in the period.

Bonds

The Company issued twenty six unsecured bond notes of US$50,000 each to certain existing and new investors, raising, in aggregate, US$1.3 million before expenses. Paracale Gold and BCM, the Company's major shareholders, each subscribed for six bonds with a value of, in aggregate, US$0.3 million respectively.

In consideration of entering into the Bonds, a total of 52,000,000 warrants were issued to subscribe for such number of Ordinary Shares at the Exercise Price, at any time during the period through to 22 June 2022. This led to an increase in the share option reserve and other receivables of US$371k in the period.

   8.          Availability of interim report 

The interim report is available on the Company's website www.goldstoneresources.com.

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September 30, 2020 02:00 ET (06:00 GMT)