Share Name Share Symbol Market Type Share ISIN Share Description
Starvest Plc LSE:SVE London Ordinary Share GB0009619817 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 1.90p 1.80p 2.00p 1.90p 1.90p 1.90p 0 08:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
General Financial 0.0 -0.3 -0.6 - 1

Starvest PLC Half-year report - six months ended 31 March 2019

17/06/2019 3:35pm

UK Regulatory (RNS & others)


Starvest (LSE:SVE)
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RNS Number : 5146C

Starvest PLC

17 June 2019

17 June 2019

Half-year report - six months ended 31 March 2019

Chairman's statement

The latter half of 2018 saw a marginal recovery in the mining and resources sector but a decline in commodity prices adversely affected share prices through Q1 2019. Despite this environment we saw a 39% increase in our Net Asset Value (NAV) from GBP1.65m at 30 September 2018 to GBP2.30m as at 31 March 2019. From March 2019, the company implemented a more transparent and objective valuation method for portfolio stocks, making use of market prices without an applied discount, and approximately 13 percentage points of the 39% increase in NAV is attributable to this change.

We saw an increase in Net Asset Value Per Share over the six months to 31 March 2019 from 3.33p per share to 4.15p per share. Over the same period the daily closing share price remained at a discount to NAV of approximately 35%.

The Company earned an operating profit of GBP640,414 during the reporting period mainly attributable to significant increases in selected portfolio stocks such as Greatland Gold plc (LON:GGP). This operating profit resulted in earnings per share of 1.02p on a fully diluted basis for the six-month period.

The Company continues its historical policy of investing in companies with early-stage mining resource projects, but we also have a mandate to invest directly in projects. Several projects are under review focused on precious and base metals. We are also evaluating other commodities such as lithium, cobalt and rare earth elements which are forecast to increase in use and demand over the medium to long term.

Several of our investee companies remain extremely active and have provided very positive news flow over the reporting period.

Greatland Gold (LON:GGP) continued exploration on its Paterson area licences with drilling at Havieron producing exciting results including 118m at 3.08g/t gold and 0.84% copper from 459m and 157m at 6.04g/t gold and 0.44% copper from 660m. Peak grades of 211.3g/t gold, 12.38% copper and 4,104ppm cobalt were established at Havieron. The Company has subsequently signed a US$65m farm-in deal with Newcrest with a minimum commitment of US$5m over an initial 12-month period with the potential for Newcrest to earn up to a 70% interest through total expenditure of US$65m over a six-year period. Newcrest may acquire an additional 5% interest at the end of the farm-in period at fair market value for cash. Greatland is well-funded to pursue its exploration work on the remaining parts of the Havieron licence and two other Paterson licences, as well as its five other project areas in Australia, with the potential to add other exciting mineral exploration discoveries.

Cora Gold (LON:CORA) has continued exploration activities on its flagship Sanankoro project, extending identified zones of gold mineralisation within a 14km long structural corridor yet to be fully tested. Independent consultants have calculated an initial exploration target of between 30-50mt of ore at an average grade of 1.0-1.3g/t for 1.0-2.0moz gold. To date mineralisation has been delineated to a depth of 100m, most of which is hosted within weathered material which ranges in depth from around 50m to in excess of 100m across the exploration target area. The relatively soft oxidised rock would potentially allow for a low-cost open pit operation.

Kefi Minerals (LON:KEFI) has taken significant steps toward mine construction with the Ethiopian government giving approval for the resettlement plan. The company has received all relevant consents from federal agencies, including an endorsement by the Prime Minster of the finance structure, with only minor aspects of the plan yet to be finalised. The principal project contractors have confirmed a 24-month development schedule set to commence in Q4 2019 while off-site project work such as power and roads construction have already commenced.

Ariana Resources (LON:AAU) continues to report good production results from its Kiziltepe Mine with 7,296oz extracted in Q1 2019, exceeding annualised quarterly guidance by 17%. The company also continues with exploration at its Kizilcukur, Tavsan and Salinbas projects.

Other investee companies push ahead such as Oracle Power (LOM:ORCP), which named a new CEO and has progressed its proposed coal mine and power plant by securing the required capital to proceed with development. Salt Lake Potash (LON:SO4) continues with exploration at its Western Australia projects and is progressing with test scale processing at one of its sites. Similarly, Sunrise Resources (LON:SRES) has continued to test its pozzolan resource in the USA with encouraging results.

Whilst the commodities market remains flat the board of Starvest believes the Company is well positioned when the sector enters its next upcycle. We continue to expect robust demand for energy and metals over the medium and long term and look forward to providing further updates to investors and the market.

Callum N Baxter

Chairman & Chief Executive

17 June 2019

Income Statement

 
                                              6 months         6 months       Year ended 
                                           to 31 March      to 31 March     30 September 
                                                  2019             2018             2018 
                                             Unaudited        Unaudited          Audited 
                                                   GBP              GBP              GBP 
 Revenue                                        27,165                -                - 
 Cost of sales                                (16,257)                -                - 
                                         -------------  ---------------  --------------- 
 Gross profit                                   10,908                -                - 
 Administrative expenses                     (127,149)        (128,922)        (250,147) 
 Amounts written off against 
  trade investments                          (133,086)        (415,421)        (686,932) 
 Amounts written back against 
  trade investments                            889,741           28,725          615,008 
 Operating profit / (loss)                     640,414        (515,618)        (322,071) 
 Interest receivable                                37            2,945            5,829 
                                         -------------  ---------------  --------------- 
 Profit / (loss) on ordinary 
  activities before tax                        640,451        (512,673)        (316,242) 
 Tax on profit on ordinary activities                -                -                - 
                                         -------------  ---------------  --------------- 
 Profit / (loss) / profit attributable 
  to Equity holders of the Company             640,451        (512,673)        (316,242) 
                                         =============  ===============  =============== 
 
 Earnings/(loss) per share - 
  see note 3                                1.18 pence     (0.97) pence     (0.60) pence 
  Basic                                     1.02 pence     (0.83) pence     (0.51) pence 
  Diluted 
 

Statement of Financial Position

 
                                               6 months      6 months      Year ended 
                                               ended 31      ended 31    30 September 
                                             March 2019    March 2018            2018 
                                              Unaudited     Unaudited         Audited 
                                                    GBP           GBP             GBP 
 Current assets 
  Trade and other receivables                    16,331        18,552          55,992 
  Trade investments                           2,258,694     1,183,287       1,498,059 
  Cash and cash equivalents                      36,429       270,995         153,849 
                                           ------------  ------------  -------------- 
 Total current assets                         2,311,454     1,472,834       1,707,900 
                                           ------------  ------------  -------------- 
 
 Current liabilities 
  Trade and other payables                     (44,504)     (104,766)       (119,401) 
                                           ------------  ------------  -------------- 
 Total current liabilities                     (44,504)     (104,766)       (119,401) 
                                           ------------  ------------  -------------- 
 
 Net current assets                           2,266,950     1,368,068       1,588,499 
                                           ============  ============  ============== 
 
  Capital and reserves 
   Called up share capital                      552,927       528,982         539,649 
   Share premium account                      1,681,431     1,640,876       1,654,209 
   Profit and loss account                       32,592     (804,290)       (607,859) 
   Equity reserve                                     -         2,500           2,500 
                                           ------------  ------------  -------------- 
 Total equity shareholders' 
  funds                                       2,266,950     1,368,068       1,588,499 
                                           ============  ============  ============== 
 
 

Statement of Cash Flows

 
                                                    6 months      6 months      Year ended 
                                                    ended 31      ended 31    30 September 
                                                  March 2019    March 2018            2018 
                                                   Unaudited     Unaudited         Audited 
                                                         GBP           GBP             GBP 
 
 Cash flows from operating activities 
 Operating profit/(loss)                             640,414     (515,619)       (322,071) 
 Net interest receivable                                  37         2,945           5,829 
 Share based payment charge                           40,500             -          24,000 
 Decrease in trade and other 
  receivables                                         39,660        11,037        (26,403) 
 (Decrease)/increase in trade 
  and other payables                                (77,396)         3,154          17,788 
                                                ------------  ------------  -------------- 
 Net cash flows from operating 
  activities                                         643,215     (498,483)       (300,857) 
                                                ------------  ------------  -------------- 
 
 Cash flows from investing activities 
 Purchase of current asset investments                     -      (50,000)        (50,000) 
 Loan converted to shares                           (20,000)             -               - 
 Sale of current asset investments                    26,928             -               - 
 Profit on sale of current asset                    (10,908)             -               - 
  investments 
 Increase in investment provisions                   133,086       415,421         686,932 
 Decrease in investment provisions                 (889,741)      (28,725)       (615,008) 
                                                ------------  ------------  -------------- 
 Net cash flows from investing 
  activities                                       (760,635)       336,696          21,924 
                                                ------------  ------------  -------------- 
 
 Net (decrease)/increase in cash 
  and cash equivalents                             (117,420)     (161,787)       (278,933) 
 Cash and cash equivalents at 
  beginning of period                                153,849       432,782         432,782 
                                                ------------  ------------  -------------- 
 Cash and cash equivalents at 
  end of period                                       36,429       270,995         153,849 
                                                ============  ============  ============== 
 
 
 

Statement of Changes in Equity

 
 
 
                                                       Equity reserve                                Total Equity 
                                                                                                   attributable to 
                         Share capital  Share premium                  Profit and loss account       shareholders 
                              GBP            GBP            GBP                  GBP                     GBP 
As at 30 September 2017        528,982      1,640,876           2,500                (291,617)               1,880,741 
                         =============  =============  ==============  =======================  ====================== 
 
(Loss) for the period                -              -               -                (512,673)               (512,673) 
                         -------------  -------------  --------------  -----------------------  ---------------------- 
Total recognised income 
 and expenses for the 
 period                              -              -               -                (512,673)               (512,673) 
 
Shares issued                        -              -               -                        -                       - 
Total contribution by 
and distributions to                                                - 
owners                               -              -                                        -                       - 
 
As at 31 March 2018            528,982      1,640,876           2,500                (804,290)               1,368,068 
                         =============  =============  ==============  =======================  ====================== 
 
As at 30 September 2018        539,649      1,654,209           2,500                (607,859)               1,588,499 
                         =============  =============  ==============  =======================  ====================== 
 
Profit for the period                -              -               -                  640,451                 640,451 
Total recognised income 
 and expenses for the 
 period                              -              -               -                  640,451                 640,451 
 
Shares issued                   13,278         27,222               -                        -                  40,500 
Equity component of 
 convertible loan                    -              -         (2,500)                        -                 (2,500) 
                         -------------  -------------  --------------  -----------------------  ---------------------- 
Total contributions by 
 and distributions to 
 owners                         13,278         27,222         (2,500)                        -                  38,000 
 
As at 31 March 2019            552,927      1,681,431               -                   32,592               2,266,950 
                         =============  =============  ==============  =======================  ====================== 
 

Interim report notes

   1.   Interim report 

The information relating to the six-month periods to 31 March 2019 and 31 March 2018 is unaudited.

The information relating to the year ended 30 September 2018 is extracted from the audited accounts of the Company which have been filed at Companies House and on which the auditors issued an unqualified audit report.

   2.   Basis of preparation 

This report has been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' ('FRS102'), and with the Companies Act 2006. Although the information included herein does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006, the accounting policies that have been applied are consistent with those adopted for the statutory accounts for the year ended 30 September 2018.

The Company will report again for the full year to 30 September 2019.

The Company's investments at 31 March 2019 are stated at the lower of cost and net realisable value or the valuation adopted at 30 September 2018 or the current market value based on market quoted prices at the close of business. The Chairman's statement includes a valuation based on market quoted prices at 31 March 2019.

   3.   Earnings per share 
 
                                            6 months         6 months       Year ended 
                                            ended 31         ended 31     30 September 
                                          March 2019       March 2018             2018 
                                           Unaudited        Unaudited          Audited 
                                                 GBP              GBP              GBP 
 
 Profit/(loss) for the period:               640,451        (512,673)        (316,242) 
                                       -------------  ---------------  --------------- 
 
   Weighted average number of 
   Ordinary shares of GBP0.01 
   in issue                               54,460,957       52,898,163       53,012,136 
 
   Earnings/(loss) per share              1.18 pence     (0.97) pence     (0.60) pence 
   - basic 
                                       -------------  ---------------  --------------- 
 
   Warrants in issue                       8,500,000        8,500,000        8,500.000 
 
   Weighted average number of 
   Diluted Ordinary shares of 
   GBP0.01 in issue                       62,960,957       61,398,163       61,512,136 
 
   Earnings/(loss) per share              1.02 pence     (0.83) pence     (0.51) pence 
   - diluted 
                                       -------------  ---------------  --------------- 
 
 

Investment portfolio

Starvest now holds trade investments in the companies listed below, which in aggregate comprise 95% of the portfolio value as at 31 March 2019:

 
                                     Exploration for oil in England, 
   *    Alba Mineral Resources plc    lead-zinc in Ireland, uranium in 
                                      Mauritania and graphite in Greenland 
                                      www.albamineralresources.com 
                                     Gold-silver production and exploration 
   *    Ariana Resources plc          in Turkey 
                                      www.arianaresources.com 
                                     Gold exploration in West Africa 
   *    Cora Gold Limited             www.coragold.com 
                                     Gold exploration in Australia 
   *    Greatland Gold plc            www.greatlandgold.com 
                                     Gold and copper exploration in Ethiopia 
   *    Kefi Minerals plc             and Saudi Arabia 
                                      www.kefi-minerals.com 
                                     Coal mining in Pakistan 
   *    Oracle Coalfields plc         www.oraclecoalfields.com 
 
 

Other direct and indirect mineral exploration companies:

 
                                                              Oil and gas exploration in Bulgaria 
   *    Block Energy plc (formerly Goldcrest Resources plc)    www.goldcrestresourcesplc.com 
                                                              Investment banking and corporate 
   *    Marechale Capital plc                                  finance www.marechalecapital.com 
                                                              Gold exploration in South America 
   *    Minera IRL Limited                                     www.minera-irl.com 
                                                              Potash in Australia 
   *    Salt Lake Potash Limited                               www.saltlaketpotash.com.au 
                                                              Exploration for industrial minerals 
   *    Sunrise Resources plc                                  in United States, Finland, Australia 
                                                               and Ireland 
                                                               www.sunriseresourcesplc.com 
 
 

Other investee companies are listed in the Company's 2018 annual report available on request or from the Company web site - www.starvest.co.uk

Copies of this interim report are available free of charge by application in writing to the Company Secretary at the Company's registered office, Salisbury House, London Wall, London EC2M 5PS, by email to info@starvest.co.uk or from the Company's website - www.starvest.co.uk

Enquiries to:

Starvest PLC

Callum Baxter or Gemma Cryan 02077 696 876 info@starvest.co.uk

Grant Thornton UK LLP (Nomad)

Colin Aaronson, Harrison Clarke or Seamus Fricker 02073 835 100

SI Capital Ltd (Broker)

Nick Emerson or Alan Gunn 01483 413 500

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.

END

IR UBOSRKRANAAR

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June 17, 2019 10:35 ET (14:35 GMT)

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