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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
W Resources Plc | LSE:WRES | London | Ordinary Share | GB00BKQN5R41 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 2.65 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMWRES
RNS Number : 4516O
W Resources PLC
01 June 2020
1 June 2020
W Resources Plc
("W" or the "Company")
Final Results for the Year Ended 31 December 2019
W Resources Plc (AIM:WRES), the tungsten, tin and gold mining company with assets in Spain and Portugal, announces its audited financial results for the year ended 31 December 2019.
HIGHLIGHTS
La Parrilla, Tungsten and Tin, Spai n
-- Construction completed on this world class tungsten and tin project in September 2019. -- Initial production of the T2 stage production commenced in November 2019.
-- Production in Q4 2019 built at a slower pace than anticipated due to early stage plant challenges, which continue to be resolved.
-- Production in Q1 2020 was reported on 17 April 2020, recording an increase in tungsten metal production to 45.2 tonnes (combined tungsten and tin).
-- Due to the COVID-19 pandemic, the timing of the EUR5.3m Grant from the Junta de Extremadura is to be confirmed with the local Government needing to prioritise resources in response to the ongoing pandemic.
Régua Tungsten Project, Portugal
-- Régua has significant synergies with La Parrilla as it has materially lower capital costs and will increase La Parrilla's final concentrate production.
-- Mining operations commenced in March 2020 and is currently paused due to the challenges presented by COVID-19.
COVID-19
The recent COVID-19 pandemic has meant that 2020 thus far has been a very challenging time for Spain and Portugal as it has for the rest of the world. Our priority has remained the health and safety of our personnel and we continued to work hard at both our operational sites in Spain and Portugal to review and maintain our priorities on this matter in relation to our staff and contractors.
In order to mitigate against risk of further impacts on production as a result of this pandemic, W has secured additional funding to ensure the Company has a strong buffer in these unprecedented times.
Chairman of W, Michael Masterman commented: "Whilst 2019 was a very challenging year with the core priority being completion of the La Parrilla plant and commencement of production and ramp-up, La Parrilla is in operation and is starting to reap the benefits from the substantial plant improvement programme executed over the last 3 months. The bulk of the operational plant improvements have been installed and are now operational. We are of the view that the plant can progressively increase both recoveries and utilisation to increase production to design capacity."
Enquiries:
W Resources Plc Grant Thornton UK LLP Michael Masterman Colin Aaronson / Jen Clarke / T: +44 (0) 20 7193 7463 Seamus Fricker www.wresources.com T: +44 (0) 20 7383 5100 Joint Broker Joint Broker Turner Pope Investments (TPI) Alternative Resource Capital / Ltd Shard Capital Andy Thacker / Zoe Alexander Alex Wood T: +44 (0) 203 657 0050 T:+44 (0) 207 186 9004 www.turnerpope.com www.altrescap.com Damon Heath T:+44 (0) 207 186 9952 www.shardcapital.com Alma PR Justine James M: +44 (0) 7525 324431 wres@almapr.co.uk
APPIX 1 - JORC COMPLIANT MINERAL RESOURCE ESTIMATES
La Parrilla Proven and Probable Mineral Reserves - JORC 2012
Tonnes Grade Metal Content Grade Metal Content '000 WO(3) (ppm) ------ ------------ WO(3) (t) Sn (ppm) Sn (t) ---------- ------ ------------ -------------- -------- ---------------- Proven 1,177 995 1,171 251 295 Probable 28,577 928 26,511 111 3,156 ---------- ------ ------------ -------------- -------- ---------------- Total 29,754 931 27,683 116 3,451
Note: The La Parrilla mine reserves are set out in the following table based on the optimal LOM Pit. Estimate for La Parrilla Deposit using a 330 ppm WO(3) Cut-Off Grade and 5% dilution. All tonnes quoted are dry tonnes. Differences in the addition of tonnes to the total displayed is due to rounding.
The La Parrilla JORC-compliant mineral reserves update was fully disclosed, with JORC Table 1 in a Company news release on 14 June 2017. Mr Adén Muñoz of AYMA Mining Solutions SL, a Spanish Mining Engineering company based in Seville was the Competent Person responsible for the La Parrilla Proven and Probable Mineral Reserves. The mineral reserves are based on indicated and measured resources prepared by Golder Associated in March 2017 (RNS, 11 May 2017).
Mineral Resources for La Parrilla Deposit Using a 400 ppm WO(3) Cut-Off Grade within Mineralised Domains - JORC 2012
Classification Tonnage (Mt) WO(3) (ppm) Sn (ppm) --------------- ------------ ----------- -------- Measured 1 1,115 278 Indicated 35 1,004 110 Inferred 13 974 97 ---------------- ------------ ----------- -------- 49 998 110
The La Parrilla JORC-compliant mineral resource update was fully disclosed, with JORC Table 1 in a Company news release on 11 May 2017. Mr Andrew Weeks (Golder Associates Pty Ltd) was the Competent Person responsible for the Mineral Resource Estimate for the La Parrilla deposit.
Régua JORC Compliant Mineral Resource Estimate reported at a 0.1% WO(3) cut-off grade
Category Tonnes WO(3) % WO(3) metal (ky) ---------- ------- ------- ----------- Indicated 3.74mt 0.28 10.6 Inferred 0.72mt 0.21 1.5 ----------- ------ ------- ----------- Total 4.47mt 0.27 12.1
The Régua JORC compliant mineral resource update was fully disclosed, with JORC Table 1 in a Company news release on 5 February 2020. Mr Andrew Weeks (Golder Associates Pty Ltd) was the Competent Person responsible for the Mineral Resource Estimate for the Régua deposit.
São Martinho Maiden JORC Compliant Mineral Resource Estimate
Category Tonnes Au (g/t) Au Content Cut-off (Oz) ---------- -------- -------- ---------- ------- 0.5 g/t Indicated 0.48 mt 1.03 17,363 Au 0.5 g/t Inferred 2.56 mt 1.05 94,624 Au ----------- ------- -------- ---------- ------- 0.5 g/t Total 3.04 mt 1.04 111,987 Au
The São Martinho maiden JORC-compliant mineral resource update was fully disclosed, with JORC Table 1 in a W Resources Plc RNS announcement on 8 June 2016. Mr Jorge Peres (Golder Associates Pty Ltd) was the Competent Person responsible for the Mineral Resource Estimate for the São Martinho deposit.
W RESOURCES PLC
CHAIRMAN'S STATEMENT
FOR THE YEARED 31 DECEMBER 2019
W Resources' focus for 2019 was to complete the construction of its world class La Parrilla Tungsten and Tin Project in Spain, which at full production will deliver 2,500tpa of tungsten and is anticipated that this will deliver EBITDA of c.US$20.0m per annum (T2 stage). Construction of the La Parrilla plant was completed in September 2019 and production commenced in late November 2019. La Parrilla, with its large-scale production capacity and low-cost structure will form the base of our cash generation and expansion in the year ahead.
Building a mine of this scale comes with its challenges and whilst the timeline to achieve this was delayed in 2019, the team has worked tirelessly to ensure the best outcome in each phase of development. This is now gaining traction for 2020 as we build towards reaching target production and delivering improved EBITDA in the year ahead.
In this environment of unprecedented market uncertainty, our main priorities in 2020 are to take La Parrilla to design capacity by the end of 2020 and to add an initial stream of tungsten production from our newly opened Régua trial mine to the La Parrilla core production base.
Planning is in place to install ore sorters at La Parrilla to effect an increase in production capacity of the current T2 - 2 million tonne per annum plant. We will gradually take the expansion to T3.5, demonstrating commercial operations in incremental steps prior to substantially expanding production capacity.
COVID-19 and Safety
The recent COVID-19 pandemic has meant that 2020 thus far has been a very challenging time for Spain and Portugal as it has for the rest of the world. Our priority has remained the health and safety of our personnel and we continued to work hard at both our operational sites in Spain and Portugal to review and maintain our priorities on this matter in relation to our staff and contractors. On 14 March 2020, Pedro Sánchez, Spain's Prime Minister, declared a national State of Emergency, which was subsequently updated stipulating with effect from 31 March 2020 that non-essential services, including mining, be closed until Thursday 9 April. The closure of non-essential services which limited operations was subsequently lifted and production at La Parrilla in Spain recommenced, following key works to improve the circuit.
In order to mitigate against risk of further impacts on production as a result of this pandemic, W has secured additional funding to ensure the Company has a strong buffer in these unprecedented times.
Our strong safety performance continues with no Lost Time Injuries during the last 12 months and a total recordable injury frequency rate ("TRIFR") of 16.1 per million hours worked, which is well below the Spanish mining industry average of 45.2. The health and safety of our all employees, contractors and customers remains an absolute priority and we are working hard to ensure we implement all measures necessary to maintain this in the current pandemic.
TUNGSTEN & TIN
La Parrilla - Spain
La Parrilla is a large-scale, low-cost, long-life tungsten and tin project, located approximately 310km southwest of Madrid. It has Australasian Joint Ore Reserves Committee ("JORC") compliant resources totalling 49 million tonnes ("mt") at a grade of 0.1% of tungsten trioxide ("WO(3) ") and JORC compliant reserves of 29.8mt (as shown in Appendix 1 of the Consolidated Financial Statements).
The first phase of the ramp-up is to reach the target to mine 2mtpa of ROM and produce approximately 2,500 tonnes ("t") of tungsten concentrate and 200t of tin ("Sn") concentrate per annum ("T2").
Production at La Parrilla is building, albeit not at the pace we had anticipated due to early stage plant challenges having an impact on production levels for Q1 2020 and the restrictive conditions during the COVID-19 State of Emergency which have necessitated mine and plant closure and operations limitation on equipment sourcing and day-to-day safe personal management which is, of course, our main priority. Significant progress has been made at the plant to address and rectify these challenges, including implementation of 15 plant improvement initiatives at a total cost of EUR300,000. The improvements are directed at significantly increasing overall recovery and reducing unplanned downtime. We expect to see these changes translate into significantly increased daily and monthly production outcomes.
W RESOURCES PLC
CHAIRMAN'S STATEMENT
FOR THE YEARED 31 DECEMBER 2019
The mining and processing operations have expanded in Q1 2020 with key initiatives implemented including construction of a pre-concentrate stockpile area to allow continued operation of the concentrator plant when the jig or crusher plants are down, installation of deslime cyclones ahead of the fines circuit and a hydrosizer ahead of the shaking tables which are complete and operational.
We are mindful that production levels at the start of the year are not where we or our stakeholders expected them to be, however we are still very much in the early stages of the ramp-up and the team is well set to achieve stronger results in the June quarter resulting from plant improvement initiatives implemented in Q1 2020.
The increase in tungsten and tin production demonstrates progress in a very difficult external environment and we remain focussed on the works in hand and are confident of making the solid progress needed in order to reach design capacity.
Notwithstanding these challenges, we are delighted to have completed construction of this impressive large-scale, long-life tungsten and tin project and to now be focussing on the matter in hand of building production at this world class mine.
Grant Update
In March 2018, the Junta de Extremadura in Spain awarded a grant of EUR5.3m to W's 100% owned subsidiary, Iberian Resources Spain SL. The conditions set, in order to be able to receive the Grant, were a minimum investment in plant and equipment of EUR16.6m and the creation of at least 20 full time positions. With these conditions successfully met, W provided the documentation to formally apply to receive this Grant. Timing of the Grant is yet to be confirmed with the local Government needing to prioritise resources in response to the ongoing COVID-19 pandemic. The team continues to enjoy strong on-the-ground relationships and appreciates the Government's support.
Tungsten and Tin sales in a challenging global environment
The COVID-19 crisis has created challenges across global tungsten and tin markets in terms of both logistics of delivery and in our customers' market environments. In these market conditions, we continue to sell and deliver all our product to our offtake partners and have broadened our distribution capacity. At times during the peak of the crisis, transportation logistics have been challenging to manage and therefore movement of product has been slower than it has been previously, but in credit to the team we have solved these issues in a timely way.
Importantly the quality of our Tungsten and Tin concentrate consistently meets or exceeds customer offtake requirements and we have seen consistent increases in concentrate quality and, in producing up to 65% WO(3) from the plant, we have shown that we are comfortably able to exceed our benchmark grades of 60%.
PORTUGUESE PROJECTS
Régua Tungsten Mine
This high-grade, development-ready tungsten project with low capital cost has a trial mine licence, and an updated JORC compliant mineral resource of 4.47Mt at a grade of 0.27% WO(3) , including an indicated resource of 3.74mt at a grade of 0.28% WO(3) , which was completed by Golder Associates Pty Ltd ("Golder") in January 2020.
As W's second mine to come on stream, following the start of production at La Parrilla in November 2019, Régua has significant synergies with La Parrilla as it has materially lower capital costs and will increase La Parrilla's final concentrate production.
Mining operations at R ég ua commenced early March 2020 with the commencement of mining in the first of two adits with skarn ore zones intersected in the initial development. However, following an extension in Portugal of COVID-19 related restrictions, mining activity has been paused. Plant design and procurement activities are near completion in advance of construction activities which have been rescheduled to later in the year after the COVID-19 crisis has hopefully passed. As a result of the requirement to pause operations, an application to extend the period of the trial mine licence has been submitted to the Portuguese mining authorities.
W RESOURCES PLC
CHAIRMAN'S STATEMENT
FOR THE YEARED 31 DECEMBER 2019
With ore haulage and crushing contracts in place with Francisco Pereira Marinho Imãos SA ("FPMI"), once mining recommences later this year, ore from Régua will be hauled 27km to the FPMI crushing plant and crushed to a range of 5-10mm. Importantly, as part of the service contract, FPMI will use the waste ore for rehabilitation of their existing quarry providing local environmental benefits. The estimated crushing and haulage cost is cUS$40-45/mtu and W will pay EUR50,000 to expand access roads for haulage.
Tarouca Exploration
While the development focus has been on Régua we have also applied for a new exploration licence at Tarouca. We expect to be able to tie in operations at Tarouca to the Régua mining and processing operations once the updated licence is granted.
CAA Portalegre - Gold
São Martinho currently has a JORC 2012 gold resource of over 110,000oz. Results from the drilling campaigns in 2017 and 2018 provided a solid base to drive extension drilling with the potential for a materially larger resource.
We have advanced São Martinho through a successful drilling programme and submitted an application for a trial mine and gold production licence in September 2018. Although the COVID-19 crisis and associated state of emergency in Portugal has further delayed the final approval process, we expect the trial mine licence to be granted in due course. The trial mine licence, once granted, will allow W to pursue a drilling programme to expand the resource and resolve the geological interpretations of a flat lying structure (Golder) and a deeply dipping structure (SRK) which have partially arisen due to the combination of structural complexity and multistage mineralising events.
Importantly, a trial mine is a key level of licence tenure and will provide the authority to mine shallow ore and produce gold on a pilot basis. We will actively explore opportunities to bring in Joint Venture parties and monetise the gold discovery in 2020. New expenditure on this project is pending grant of the trial mining licence.
Finance
Whilst completion of the new plant at La Parrilla was later than planned, it has remained our priority to ensure W has had a strong buffer of additional financial resources in place to mitigate against the resulting delayed production and also to ensure W remains resilient in the year ahead with the uncertainty created by COVID-19.
In the FY19, the Company secured a EUR3m loan facility with Caja Rural de Extremadura to provide an advance of funding against the EUR5.3m grant awarded by the Junta de Extremadura ("Grant"). This loan had an interest rate of 1.75% per annum for a term of 15 months, although subsequent to 31 December, 2019, on 31 January 2020, Iberian Resources Spain S. L. signed a loan agreement for EUR5m with Banco Santander, S.A ("Santander") which repaid the EUR3m loan from the Caja Rural de Extremadura. The Santander facility interest rate is 3% per annum, and this loan is now secured by a pledge over the rights to the Grant funds. As stated above, the timing of receipt of the Grant is to be advised by the local Government, which is currently and understandably prioritising its efforts towards coping with the COVID-19 pandemic.
In August 2019, BlackRock Financial Management Inc. ("BlackRock") agreed to capitalise an additional six months of interest payments of the BlackRock term loan, which equated to US$1.29m, and was added to the final loan balance . Furthermore, in December 2019, BlackRock increased its existing loan facility by US$5 million. The additional facility and the roll up of interest (PIK) increased the total outstanding BlackRock loan balance to US$50.5m at 31 March 2020.
During 2019, W raised a total of GBP2.57m in equity funding. In September, the Company completed a EUR1m Placing at 0.5p per Ordinary Share, a premium to the share price, from supportive private Spanish investors.
In November 2019, the Company secured a funding package to raise cEUR2.78m which comprised a first tranche of EUR1.358m secured through: an equity placement of GBP289k (EUR330k) at 0.40p, loans from Directors of GBP344k (EUR392k); and Blackrock agreed that an additional 50% of the November interest payment, amounting to US$700k (EUR636k) could be added to the existing debt facility (PIK - payment in kind). Subsequent to this, in January 2020 the short-term loans provided by three of W's directors were converted into ordinary shares at a price of 0.307p per Ordinary Share.
W RESOURCES PLC
CHAIRMAN'S STATEMENT
FOR THE YEARED 31 DECEMBER 2019
As part of the second tranche, the Company completed a Placing to raise GBP360,000 at a price of 0.40p per Ordinary Share to a new Spanish investor in addition to securing a new EUR500,000 revolving credit facility with leading Spanish Bank; CaixaBank, S.A.
Tungsten and Tin
Tungsten and Tin demand and supply has been disrupted by the COVID-19 crisis.
Given the severity of the crisis, Tungsten prices have been relatively solid and sit at US$215-225, which is 22% down on budget expectations. There have been substantial shutdowns of capacity in China, the world's largest producer of tungsten and as the world economy comes out of the various lockdowns we do expect continued price volatility and a boost in global demand although it is too early to judge the supply/demand balance for the rest of 2020.
Tin prices on the London Metal Exchange started 2020 trading at US$17,125 per metric ton, and moved in an upward trend until January 2020, when the coronavirus outbreak took over news headlines and the price came under pressure. Notably, the market view is that whilst tin plays a pivotal role in all modern technology and has a large role to play in the electric vehicle market, it is the low-cost producers who will continue to reap the benefits due to the unpredictable nature of the COVID-19 pandemic. With a more stable environment, market forecasts expect tin to stabilise in the mid US$20,000 per metric ton. (source: Investing News).
Outlook
2019 was a very challenging year with the core priority being completion of the La Parrilla plant and commencement of production and ramp-up.
There is no question, however, that the global challenges of 2020 are significantly more difficult, but I believe that our team has responded to them thoughtfully and effectively.
-- States of Emergency in both Spain and Portugal have required short-term closures of both La Parrilla and Régua.
-- Régua mining and construction operations are currently closed pending confirmation from the Portuguese authorities. We expect to recommence mining in Q3 2020.
-- La Parrilla is in operation and is starting to reap the benefits from the substantial plant improvement programme executed over the last 3 months.
-- Production on the March quarter was reported on 17 April 2020, recording an increase in tungsten metal production to 45.2 tonnes (combined tungsten and tin).
-- During the COVID-19 crisis shut down which came into effect early in June, we have effected substantial improvements in operating capacity which we expect to translate into significant increases in production in the latter stages of the June quarter.
-- The bulk of the operational plant improvements have been installed and are now operational. We are of the view that the plant can progressively increase both recoveries and utilisation to increase production to design capacity.
-- Stock and commodity market conditions will remain volatile and subject to substantial uncertainty.
The team, with the strong support of the Board, continues to execute development well and this is a credit to the calibre of the management team.
________________
Michael Masterman
Chairman
W RESOURCES PLC
GROUP STRATEGIC REPORT
FOR THE YEARED 31 DECEMBER 2019
The directors present their strategic report of the company and the group for the year ended 31 December 2019.
REVIEW OF BUSINESS
The results for the year and the financial position of the Group and the Company at the year-end are as shown in the annexed financial statements.
The Group has incurred a loss after tax of EUR2,942,000 for the year ended 31 December 2019. This is driven by exchange losses of EUR653,000 on translation of the US dollar denominated BlackRock Financial Management Inc. loan into Euros at 31 December 2019 and finance costs associated with the BlackRock Financial Management Inc. loan of EUR1,054,000. An operating loss of EUR1,244,000 was incurred in the year to 31 December 2019, compared to an operating loss of EUR899,000 for the year to 31 December 2018.
Detailed reviews of activities, business developments and projects are included within the Chairman's Statement.
PRINCIPAL RISKS AND UNCERTAINTIES
The Group uses various financial instruments. These include cash, convertible loans and various other items, such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the Company's operations.
The existence of these financial instruments exposes the Company to a number of financial risks, which are described in more detail below. The Directors review and agree policies for managing each of these risks and they are summarised below. These policies have remained unchanged from previous years.
Price Risk
The Directors consider that the price of tungsten is an area of potential risk. This is reviewed on a constant basis by the Board and Senior Management.
Liquidity Risk
The Group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably.
Currency Risk
The Group principally operates in GBP and EUR and has borrowings in US$. It does not currently consider the risk of exposure to be material. As such the Directors do not currently consider it necessary to enter into forward exchange contracts. This situation is monitored on a regular basis.
ON BEHALF OF THE BOARD:
________________
Michael Masterman
Chairman
Date: 1 June 2020
W RESOURCES PLC
CONSOLIDATED STATEMENT OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE YEARED 31 DECEMBER 2019
2019 2018 CONTINUING OPERATIONS Notes EUR'000 EUR'000 Revenue 2 365 219 Cost of sales (343) (219) GROSS PROFIT 22 - Operating expenses (498) (77) Administrative expenses (768) (822) OPERATING LOSS BEFORE EXCEPTIONAL ITEMS (1,244) (899) Exceptional items - 165 OPERATING LOSS (1,244) (734) Finance costs 4 (1,200) (1,082) Exchange losses (498) (2,423) Impairment charge - (353) -------- -------- LOSS BEFORE INCOME TAX 5 (2,942) (4,592) Income tax 6 - 76 LOSS FOR THE YEAR (2,942) (4,516) OTHER COMPREHENSIVE INCOME Items that will not be reclassified to profit or loss: Translation reserve - 721 Income tax relating to items that will - - not be reclassified to profit or loss OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX - 721 TOTAL COMPREHENSIVE INCOME FOR THE YEAR (2,942) (3,795) Loss attributable to owners of the parent (2,942) (4,516) Total comprehensive income attributable to owners of the parent (2,942) (3,795) Loss per share expressed in cents per share: 8 Basic -0.05 -0.08 Diluted -0.05 -0.08
W RESOURCES PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2019
ASSETS 2019 2018 NON-CURRENT ASSETS Notes EUR'000 EUR'000 Intangible assets 9 31,882 26,609 Property, plant and equipment 10 30,103 18,551 Investments 11 - - 61,985 45,160 CURRENT ASSETS Inventories 12 415 179 Trade and other receivables 13 6,580 6,580 Cash and cash equivalents 14 2,460 6,787 9,455 13,546 TOTAL ASSETS 71,440 58,706 EQUITY SHAREHOLDERS' EQUITY Called up share capital 15 7,822 7,137 Share premium 16 36,658 34,418 Share based payment reserve 16 1,622 1,622 Merger reserve 16 1,014 1,014 Translation reserve 16 - (3,791) Retained earnings 16 (28,027) (21,294) TOTAL EQUITY 19,089 19,106 LIABILITIES NON-CURRENT LIABILITIES Financial liabilities - borrowings Interest bearing loans and borrowings 18 44,312 33,746 CURRENT LIABILITIES
Trade and other payables 17 3,978 5,854 Financial liabilities - borrowings Interest bearing loans and borrowings 18 4,061 - 8,039 5,854 TOTAL LIABILITIES 52,351 39,600 TOTAL EQUITY AND LIABILITIES 71,440 58,706
The financial statements were approved by the Board of Directors and authorised for issue on 1 June 2020 and were signed on its behalf by:
________________
Michael Masterman
Chairman
Date: 1 June 2020
W RESOURCES PLC
COMPANY STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2019
ASSETS 2019 2018 NON-CURRENT ASSETS Notes EUR'000 EUR'000 Investments 11 6,695 1,695 6,695 1,695 CURRENT ASSETS Trade and other receivables 13 63,185 51,717 Cash and cash equivalents 14 1,670 4,848 64,855 56,565 TOTAL ASSETS 71,550 58,260 EQUITY SHAREHOLDERS' EQUITY Called up share capital 15 7,822 7,137 Share premium 16 36,658 34,418 Share based payment reserve 16 1,622 1,622 Merger reserve 16 1,014 1,014 Translation reserve 16 - (5,683) Retained earnings 16 (20,586) (14,207) TOTAL EQUITY 26,530 24,301 LIABILITIES NON-CURRENT LIABILITIES Financial liabilities - borrowings Interest bearing loans and borrowings 18 44,273 33,746 CURRENT LIABILITIES Trade and other payables 17 747 213 TOTAL LIABILITIES 45,020 33,959 TOTAL EQUITY AND LIABILITIES 71,550 58,260
The financial statements were approved by the Board of Directors and authorised for issue on 1 June 2020 and were signed on its behalf by:
________________
Michael Masterman
Chairman
Date: 1 June 2020
W RESOURCES PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2019
Share Called Based up Share Retained Share Payment Merger Translation Total Capital Earnings Premium Reserve Reserve Reserve Equity EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 Balance at 1 January 2018 6,397 (16,778) 31,655 67 1,014 (4,512) 17,843 Changes in equity Total comprehensive income - (4,516) - - - 721 (3,795) Issue of share capital 740 - 2,763 - - - 3,503 Transactions with owners - - - 1,555 - - 1,555 -------- --------- -------- -------- -------- ------------ -------- Balance at 31 December 2018 7,137 (21,294) 34,418 1,622 1,014 (3,791) 19,106 -------- --------- -------- -------- -------- ------------ -------- Changes in equity Total comprehensive income - (2,942) - - - - (2,942) Issue of share capital 685 - 2,240 - - - 2,925 Transfers between reserves - (3,791) - - - 3,791 - Transactions with owners - - - - - - - -------- --------- -------- -------- -------- ------------ -------- Balance at 31 December 2019 7,822 (28,027) 36,658 1,622 1,014 - 19,089 ======== ========= ======== ======== ======== ============ ========
W RESOURCES PLC
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2019
Share Called Based up Share Retained Share Payment Merger Translation Total Capital Earnings Premium Reserve Reserve Reserve Equity EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 Balance at 1 January 2018 6,397 (12,562) 31,655 67 1,014 (5,491) 21,080 Changes in equity Issue of share capital 740 - 2,763 - - - 3,503 Total comprehensive income - (1,645) - - - (192) (1,837) Transactions with directors - - - 1,555 - - 1,555 -------- --------- -------- -------- -------- ------------ --------- Balance at 31 December 2018 7,137 (14,207) 34,418 1,622 1,014 (5,683) 24,301 -------- --------- -------- -------- -------- ------------ --------- Changes in equity Issue of share capital 685 - 2,240 - - - 2,925 Total comprehensive income - (696) - - - - (696) Transfers between reserves - (5,683) - - - 5,683 - Transactions with directors - - - - - - - -------- --------- -------- -------- -------- ------------ --------- Balance at 31 December 2019 7,822 (20,586) 36,658 1,622 1,014 - 26,530 ======== ========= ======== ======== ======== ============ =========
W RESOURCES PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEARED 31 DECEMBER 2019
2019 2018 Cash flows from operating activities Notes EUR'000 EUR'000 Cash generated from operations 1 (4,592) 5,989 Interest paid (146) (109) Finance costs paid (426) (5,311) Tax paid - (64) --------- --------- Net cash from operating activities (5,164) 505 --------- --------- Cash flows from investing activities Purchase of intangible fixed assets (7,343) (10,440) Purchase of tangible fixed assets (4,235) (14,315) --------- --------- Net cash from investing activities (11,578) (24,755) --------- --------- Cash flows from financing activities New loans in year 9,050 27,606 Loan repayments in year - (384) New hire purchases in year 58 - Payment of lease liabilities (8) - Amount introduced by directors 390 - Share issue 685 740 Share issue premium 2,329 2,904 Translation adjustment - (191) Share issue costs (89) (141) --------- --------- Net cash from financing activities 12,415 30,534 --------- --------- (Decrease) / increase in cash and cash equivalents (4,327) 6,284 Cash and cash equivalents at beginning of year 2 6,787 503 --------- --------- Cash and cash equivalents at end of year 2 2,460 6,787 ========= =========
W RESOURCES PLC
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEARED 31 DECEMBER 2019
2019 2018 Cash flows from operating activities Notes EUR'000 EUR'000 Cash generated from operations 1 (12,364) (22,639) Interest paid - (2) Finance costs paid (426) (4,360) Tax paid - (62) --------- --------- Net cash from operating activities (12,790) (27,063) --------- --------- Cash flows from investing activities Interest received 1,297 780 Net cash from investing activities 1,297 780 --------- --------- Cash flows from financing activities New loans in year 5,000 27,606 Amount introduced by directors 390 - Share issue 685 740 Share premium 2,329 2,904 Translation reserve - (192) Share issue costs (89) (141) --------- --------- Net cash from financing activities 8,315 30,917 --------- --------- (Decrease) / increase in cash and cash equivalents (3,178) 4,634 Cash and cash equivalents at beginning of year 2 4,848 214 --------- --------- Cash and cash equivalents at end of year 2 1,670 4,848 ========= =========
W RESOURCES PLC
NOTES TO THE STATEMENTS OF CASH FLOWS
FOR THE YEARED 31 DECEMBER 2019
1. RECONCILIATION OF LOSS BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS 2019 2018 Group EUR'000 EUR'000 Loss before income tax (2,942) (4,592) Depreciation charges 280 251 Exchange losses on new loans - 2,952 Translation reserve - 727 Share warrants issued - 264 Share options issued - 116 Impairment of intangible assets - 353 Finance costs 1,200 1,082 (1,462) 1,153 Increase in inventories (236) (127) (Increase) / decrease in trade and other receivables (628) 112 (Decrease) / increase in trade and other payables (2,266) 4,851 --------- --------- Cash generated from operations (4,592) 5,989 ========= ========= Company Loss before income tax (696) (1,722) Exchange losses on new loans - 2,952 Increase in inter-group loans (11,383) (25,274) Share warrants issued - 264 Share options issued - 115 Finance costs 872 804 Finance income (1,297) (780) (12,504) (23,641) (Increase) / decrease in trade and other receivables (10) 1,127 (Decrease) / increase in trade and other payables 150 (125) --------- --------- Cash generated from operations (12,364) (22,639) ========= ========= 2. CASH AND CASH EQUIVALENTS
The amounts disclosed on the Statements of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:
Group Company 31.12.19 1.1.19 31.12.19 1.1.19 EUR'000 EUR'000 EUR'000 EUR'000 Year ended 31 December 2019 Cash and cash equivalents 2,460 6,787 1,670 4,848 ========= ======== ========= ======== 31.12.18 1.1.18 31.12.18 1.1.18 EUR'000 EUR'000 EUR'000 EUR'000 Year ended 31 December 2018 Cash and cash equivalents 6,787 503 4,848 214 ========= ======== ========= ========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
2. SEGMENTAL INFORMATION 2018 Mineral By Business Segment: Corporate Exploration Total EUR'000 EUR'000 EUR'000 Revenue - 219 219 Gain / (loss) for the year (3,499) (1,017) (4,516) ---------- ------------ --------- Balance Sheet - Segment Assets 8,492 50,214 58,706 - Segment Liabilities (33,876) (5,724) (39,600) ---------- ------------ --------- Net Assets (25,384) 44,490 19,106 ========== ============ ========= By Geographical Iberia UK Total Sector EUR'000 EUR'000 EUR'000 Revenue 219 - 219 Gain / (loss) for the year (1,017) (3,499) (4,516) ---------- ------------ --------- Balance Sheet - Segment Assets 50,214 8,492 58,706 - Segment Liabilities (5,724) (33,876) (39,600) ---------- ------------ --------- Net Assets 44,490 (25,384) 19,106 ========== ============ ========= 2019 Mineral By Business Segment: Corporate Exploration Total EUR'000 EUR'000 EUR'000 Revenue - 365 365 Gain / (loss) for the year (2,009) (933) (2,942) ---------- ------------ --------- Balance Sheet - Segment Assets 4,881 66,559 71,440 - Segment Liabilities (44,959) (7,392) (52,351) ---------- ------------ --------- Net Assets (40,078) 59,167 19,089 ========== ============ ========= By Geographical Iberia UK Total Sector EUR'000 EUR'000 EUR'000 Revenue 365 - 365 Gain / (loss) for the year (933) (2,009) (2,942) ---------- ------------ --------- Balance Sheet - Segment Assets 66,559 4,881 71,440 - Segment Liabilities (7,392) (44,959) (52,351) ---------- ------------ --------- Net Assets 59,167 (40,078) 19,089 ========== ============ =========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
4. NET FINANCE COSTS 2019 2018 Finance costs: EUR'000 EUR'000 Other finance costs 146 109 Amortisation of loan costs 1,054 973 -------- -------- 1,200 1,082 ======== ======== 5. LOSS BEFORE INCOME TAX
The loss before income tax is stated after charging / (crediting):
2019 2018 EUR'000 EUR'000 Cost of inventories recognised as expense 343 219 Depreciation - owned assets 218 190 Exploration & evaluation costs amortisation 61 62 Auditors' remuneration 33 28 Auditors' remuneration for non-audit work - 4 Foreign exchange differences 495 2,422 Exceptional items - 148 Impairment charge - 317 ======== ========
A total of EUR304,000 (2018: EUR303,000) relating to Michael Masterman's consultancy fees were capitalised in intangible assets in 2019.
An exceptional loss of EUR(165,000) in 2016 related to a review by HMRC of the Company's VAT position resulting in the suspension of the Company's VAT registration number and a deemed irrecoverability of VAT, which was provided for in the financial statements. The Company disputed HMRC's decision and the review was concluded during the last financial year.
It was concluded at tribunal that the Company's VAT registration be reinstated, and that VAT may be claimed from 1 July 2014 onwards. During the current year and in previous years no VAT was reclaimed and expenditure in 2017 and 2018 is shown gross of VAT. In 2018 however, an adjustment has been made to reverse the provision made in 2016 and to adjust the Statement of profit and loss for all unclaimed VAT. The reduction is shown as an exceptional gain in 2018, and totals EUR165,000.
The impairment charge of EUR353,000 in 2018 relates only to the Monforte-Tinoca copper exploration area. The assay results did not demonstrate a regular distribution of significant mineralisation or grade, nor any potential extension of the ore body, to justify a positive future financial return. Given these results, the Company decided not to extend nor renew the exploration license. The area was discontinued effective from 6 November 2018, resulting in this impairment charge and equal to the capitalised exploration expenditure incurred from the date it was awarded until 31 December 2018.
6. INCOME TAX 2019 2018 EUR'000 EUR'000 Current tax: Tax - (76) -------- -------- Total tax (income) / expense in consolidated statement of profit or loss and other comprehensive income - (76) ======== ========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
6. INCOME TAX continued
Factors affecting the tax expense
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:
2019 2018 EUR'000 EUR'000 Loss before income tax (2,942) (872) ======== ======== Loss multiplied by the standard rate of corporation tax in the UK of 19% (2018 - 19%) (559) (872) Effects of: Share options cost disallowed - (22) Share warrants cost disallowed - (50) Benefit of losses brought forward (4,976) (4,108) Benefit of losses carried forward 5,535 4,976 -------- -------- Tax income - (76) ======== ======== 8. LOSS PER SHARE
Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.
Diluted loss per share is calculated using the weighted average number of shares adjusted to assume the conversion of all dilutive potential ordinary shares. The share options issued during 2016, 2018 and 2019 are considered to be anti-dilutive in accordance with IAS 33 as on conversion they would decrease loss per share from continuing operations.
Reconciliations are set out below 2019 Weighted Average Number Per Share Loss of Shares Amount EUR'000 (millions) Cents Basic loss per share Loss attributable to ordinary shareholders (2,942) 6,018 -0.05 Effect of dilutive securities - - - -------- ----------- ---------- Diluted loss per share Adjusted loss (2,942) 6,018 -0.05 ======== =========== ========== 2018 Weighted Average Number Per Share Loss of Shares Amount EUR'000 (millions) Cents Basic loss per share Loss attributable to ordinary shareholders (4,516) 5,423 -0.08 Effect of dilutive securities - - - -------- ----------- ---------- Diluted loss per share Adjusted loss (4,516) 5,423 -0.08 ======== =========== ==========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
9. INTANGIBLE ASSETS Exploration Group & Evaluation Costs COST EUR'000 At 1 January 2019 27,282 Additions 10,567 Reclassification / transfer (5,233) ------------- At 31 December 2019 32,616 ------------- AMORTISATION At 1 January 2019 673 Amortisation for year 61 At 31 December 2019 734 ------------- NET BOOK VALUE At 31 December 2019 31,882 =============
Intangible asset additions includes a reduction of EUR470,000 in relation to an invoice issued to Arypex SL, from whom the Group acquired the rights to the mining concessions in Spain, to recover expenses incurred by the Group to correct certain environmental damages which originated prior to the date that the Group signed the original lease (with option to purchase agreement) with Arypex SL, in 2009.
Exploration Group & Evaluation Costs COST EUR'000 At 1 January 2018 15,438 Additions 11,683 Reclassification / transfer 161 ------------- At 31 December 2018 27,282 ------------- AMORTISATION At 1 January 2018 255 Amortisation for year 62 Impairments 353 Exchange differences 3 ------------- At 31 December 2018 673 ------------- NET BOOK VALUE At 31 December 2018 26,609 =============
The above represents capitalised testing works and concessions costs acquired.
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
10. PROPERTY, PLANT AND EQUIPMENT Group Plant & Machinery COST EUR'000 At 1 January 2019 19,355 Additions 6,537 Reclassification / transfer 5,233 ---------- At 31 December 2019 31,125 ---------- DEPRECIATION At 1 January 2019 804 Charge for year 218 At 31 December 2019 1,022 ---------- NET BOOK VALUE At 31 December 2019 30,103 ========== Group Plant & Machinery COST EUR'000 At 1 January 2018 3,063 Additions 16,259 Exchange differences 33 ---------- At 31 December 2018 19,355 ---------- DEPRECIATION
At 1 January 2018 607 Charge for year 190 Exchange differences 7 ---------- At 31 December 2018 804 ---------- NET BOOK VALUE At 31 December 2018 18,551 ==========
At 31 December 2019, the following non-current assets, which were additions during the construction phase of La Parrilla mine, during 2018 and its completion in 2019, were reclassified from intangible non-current assets to tangible non-current assets to better reflect their physical nature or direct attribution to the construction cost of the new plants:
Cumulative balance further to reclassification Reclassification 2019 2018 EURuro EURuro Civils & earthworks 2,422,940 1,159,374 Tailings dam walls 660,859 412,635 Transformation centre 2,566,671 1,618,238 Project management fees 1,498,885 1,200,957 Engineering fees 849,277 841,787 ------------- ----------------- Total 7,998,632 5,232,990 ------------- -----------------
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
11. INVESTMENTS Company Shares in Group Undertakings COST EUR'000 At 1 January 2019 1,695 Additions 5,000 ------------- and 31 December 2019 6,695 ------------- NET BOOK VALUE At 31 December 2019 6,695 ============= At 31 December 2018 1,695 ============= Company Shares in Group Undertakings COST EUR'000 At 1 January 2018 ------------- and 31 December 2018 1,695 ------------- NET BOOK VALUE At 31 December 2018 1,695 =============
Company
During the year the company converted EUR5m of its intercompany loan with Iberian Resources Spain SL into equity in Iberian Resources Spain SL.
The group or the company's investments at the Statement of Financial Position date in the share capital of companies include the following:
Direct Subsidiaries
Iberian Resources Spain SL
Registered office: Finca La Parrilla, 10132 Almoharin Cáceres, Spain
Nature of business: Tungsten mining, production, exploration
% Class of shares: Holding Ordinary 100.00 2019 2018 EUR'000 EUR'000 Aggregate capital and reserves (6,258) (4,145) ======== ========
Copper Gold Resources Plc (Group)
Registered office: 27/28 Eastcastle Street, London W1W 8DH
Nature of business: Tungsten mining exploration, development
% Class of shares: Holding Ordinary 100.00 2019 2018 EUR'000 EUR'000 Aggregate capital and reserves (367) (235) ======== ========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
11. INVESTMENTS - continued
Indirect subsidiaries
Iberian Resources Portugal LDA
Registered office: Lugar das Mozes, 5110-159 Armamar, Portugal
Nature of business: Mineral Exploration
% Class of shares: Holding Copper Gold Resources Plc owns 100.00 2019 2018 EUR'000 EUR'000 Aggregate capital and reserves (431) (312) ======== ======== 12. INVENTORIES Group 2019 2018 EUR'000 EUR'000 Concentrate for re-sale 415 179 ======== ======== 13. TRADE AND OTHER RECEIVABLES Group Company 2019 2018 2019 2018 EUR'000 EUR'000 EUR'000 EUR'000 Current: Trade receivables 36 - - - Other receivables 905 1,037 61 58 Other prepayments 1,929 1,203 36 31 Finance cost prepayments 1,203 1,063 1,009 871 >1 year: Amounts owed by group undertakings - - 59,977 48,071 Finance cost prepayments 2,507 3,277 2,102 2,686 -------- -------- -------- -------- 6,580 6,580 63,185 51,717 ======== ======== ======== ======== 14. CASH AND CASH EQUIVALENTS Group Company 2019 2018 2019 2018 EUR'000 EUR'000 EUR'000 EUR'000 Bank accounts 2,460 6,787 1,670 4,848 ======== ======== ======== ======== 15. CALLED UP SHARE CAPITAL Allotted and issued: Nominal 2019 2018 Number Class Value GBP'000 GBP'000 6,378,427,640 (2018: 5,784,197,054) Ordinary 0.1p 7,134 6,448 ======== ======== ========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2019
15. CALLED UP SHARE CAPITAL - continued
594,230,586 Ordinary Shares of 0.1p were issued during the year for cash as follows:
- On 5 February 2019, 9,183,673 Ordinary Shares of 0.1p each were issued at a premium of 0.39p raising EUR51,043.
- On 18 April 2019, 201,571,429 Ordinary Shares of 0.1p each were issued at a premium of 0.32p raising GBP846,600 (EUR979,855). This was in part the exercise of 200,000,000 share warrants issued last year.
- On 22 May 2019, 35,714,284 Ordinary Shares of 0.1p each were issued at a premium of 0.32p raising GBP150,000 (EUR170,145). This was the exercise of 35,714,284 share warrants issued last year.
- On 16 September 2019, 185,511,200 Ordinary Shares of 0.1p each were issued at a premium of 0.40p raising GBP927,556 (EUR1,052,962)
- On 15 November 2019, 72,250,000 Ordinary Shares of 0.1p each were issued at a premium of 0.30p raising GBP289,000 (EUR337,350)
- On 29 November 2019, 90,000,000 Ordinary Shares of 0.1p each were issued at a premium of 0.30p raising GBP360,000 (EUR422,280)
At the year-end there were 779,033,998 Share Warrants in issue that were yet to be exercised. (2018: 554,034,000).
16. RESERVES Share Group Based Retained Share Payment Earnings Premium Reserve EUR'000 EUR'000 EUR'000 At 1 January 2019 (21,294) 34,418 1,622 Deficit for the year (2,942) - - Cash share issue - 2,329 - Cost of share issue - (89) - Transfer of reserves (3,791) - - --------- -------- -------- At 31 December 2019 (28,027) 36,658 1,622 ========= ======== ======== Group Merger Translation Reserve Reserve Totals EUR'000 EUR'000 EUR'000 At 1 January 2019 1,014 (3,791) 11,969 Deficit for the year - - (2,942) Cash share issue - - 2,329 Cost of share issue - - (89) Transfer of reserves - 3,791 - -------- ------------ -------- At 31 December 2019 1,014 - 11,267 ======== ============ ========
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
16. RESERVES - continued Share Company Based Retained Share Payment Earnings Premium Reserve EUR'000 EUR'000 EUR'000 At 1 January 2019 (14,207) 34,418 1,622 Deficit for the year (696) - - Cash share issue - 2,329 - Cost of share issue - (89) - Share options issued (5,683) - - --------- -------- -------- At 31 December 2019 (20,586) 36,658 1,622 ========= ======== ======== Company Merger Translation Reserve Reserve Totals EUR'000 EUR'000 EUR'000 At 1 January 2019 1,014 (5,683) 17,164 Deficit for the year - - (696) Cash share issue - - 2,329 Cost of share issue - - (89) Transfer of reserves - 5,683 - -------- ------------ -------- At 31 December 2019 1,014 - 18,708 ======== ============ ======== 17. TRADE AND OTHER PAYABLES Group Company 2019 2018 2019 2018 EUR'000 EUR'000 EUR'000 EUR'000 Current: Trade creditors 3,500 5,782 198 63 Amounts owed to group undertakings - - 75 81 Other creditors 2 1 2 1 Accrued expenses 86 71 82 68 Directors' current accounts 390 - 390 - -------- -------- -------- -------- 3,978 5,854 747 213 ======== ======== ======== ======== 18. FINANCIAL LIABILITIES - BORROWINGS
On 14 February 2018, W Resources signed a Credit and Guaranty Agreement with BlackRock Financial Management Inc. to provide a US$35 million secured term loan facility to the Company to fund the La Parrilla mine development. The first US$13.125 million was drawn in February 2018 and the balance of US$21.875 million was funded in May 2018.
The key terms of the Credit and Guaranty Agreement with BlackRock Financial Management Inc. are as follows:
- The Loan is for a scheduled term of five years, with a two-year non-call period. The Company has the right to repay the Loan after two years for a premium of 5%, after three years for a premium of 3%, and after four years for no premium; the Loan is secured over the value of the Group's intangible and tangible assets in Spain and in Portugal as well as the stream of future revenues expected from off take agreements.
- Subject to any early repayment permitted or required under the Agreement, repayment will be made by way of a cash flow sweep, utilising free cash to repay the loan; it is not expected that cash will be available within the initial two-year period and therefore the full amount of the loan has been recognised as payable between 2-5 years.
W RESOURCES PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
18. FINANCIAL LIABILITIES - BORROWINGS - continued
- The Loan is subject to an average 5-year interest rate of 12.6%, being 14% in the first year, 13% in the second year and 12% thereafter.
- First year interest is added to the value of the principal, while 50% of the second-year interest is added to the value of the principal and 50% is payable in cash; from the third year onwards, interest will be fully payable in cash on quarterly anniversaries of the loan agreement.
- Lenders received a non-refundable upfront fee of 3% of the face value of each of the respective Loan disbursements.
- Lenders received warrants totalling 5% of W Resources Plc fully diluted equity. These have been valued at 5% of the total loan value EUR1,440,000 (note 21).
On 18 December 2019, BlackRock Financial Management Inc. agreed to increase the existing loan facility provided to W Resources by US$5 million, with no warrants attached.
During the year interest of EUR5,257,259 (2018: EUR3,141,667) was incurred on the Loan. This was added to the loan capital during the year and recharged by W Resources PLC to its subsidiary Iberian Resources Spain SL where it was capitalised in Intangible and in Tangible assets in proportion to the expenditure on each of these categories during the year, and in accordance with the Groups accounting policy for loan interest.
The value of the BlackRock Financial Management Inc. loan included in the statement of financial position at the balance sheet date is US$49,458,659 (EUR44,273,000) (2018: EUR33,746,000).
On 7 May 2019, a loan of EUR3,000,000 was advanced by Spanish bank, Caja Rural de Extremadura to Iberian Resources Spain S.L. with a term of 15 months and an interest rate of 1.75% p.a. The Caja Rural de Extremadura bank has a lien over the grant to receivable from the Junta de Extremadura of EUR5.3 million. The value of this loan included in the statement of financial position at the balance sheet date is EUR3,000,000 (2018: NIL).
On 18 June 2019, an overdraft facility of EUR300,000 was provided by Banco Bilbao Vizcaya to Iberian Resources Spain S.L. with a term of 12 months and an interest rate of 2.65% p.a. A 29% APR will apply if not repaid by 18 June 2020. The value of this overdraft included in the statement of financial position at the balance sheet date is EUR299,700 (2018: NIL).
On 15 October 2019, the Banco Bilbao Vizcaya provided and advance on VAT receivables of EUR50,000 to Iberian Resources Spain S.L. with a term of 12 months and an Interest rate of 2.3% p.a. The value of this VAT advance included in the statement of financial position at the balance sheet date is EUR50,000 (2018: NIL).
On 15 October 2019, Iberian Resources Spain S. L. signed a reverse factoring agreement with the Banco Bilbao Vizcaya, for up to EUR200,000 with an interest rate 2.75% p.a. The value of this credit facility included in the statement of financial position at the balance sheet date is EUR199,833 (2018: NIL).
On 3 December 2019, Iberian Resources Spain S. L. signed a revolving credit facility of EUR500,000 with CaixaBank with a term 6 months and an interest rate of 2.5% p.a.. The value of this credit facility included in the statement of financial position at the balance sheet date is EUR500,000 (2018: NIL).
Subsequent to 31 December 2019, on 31 January 2020 Iberian Resources Spain S. L. signed a loan agreement for EUR5,000,000 with Banco Santander, S.A ("Santander") which repaid the EUR3,000,000 loan from the Caja Rural de Extremadura. The facility interest rate is 3% per annum, payable quarterly, with no amortisation and is secured by a pledge over the rights to the Grant funds. The term of the loan is the earlier of 12 months or the receipt of the proceeds of the Grant funds.
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
FR WPUBUAUPUGQG
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June 01, 2020 02:35 ET (06:35 GMT)
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