TIDMAFP
RNS Number : 9018Q
African Pioneer PLC
30 June 2022
30 June 2022
African Pioneer Plc
("African Pioneer" or the "Company")
Final Results for period to 31 December 2021
African Pioneer plc ("APP" or the "Company"), the exploration
and resource development company with projects located in Namibia,
Botswana and Zambia, reports its full year results for the year
ended 31 December 2021.
The Annual Report and Financial Statements for the year ended 31
December 2021 will shortly be available on the Company's website at
https://africanpioneerplc.com/ . A copy of the Annual Report and
Financial Statements will also be uploaded to the National Storage
Mechanism where it will be available for viewing at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Please note that page references in the text below refer to the
page numbers in the Annual Report and Financial Statements.
This announcement contains inside information for the purposes
of Article 7 of Regulation 2014/596/EU which is part of domestic UK
law pursuant to the Market Abuse (Amendment) (EU Exit) regulations
(SI 2019/310).
For further information, please contact:
African Pioneer Plc
Colin Bird
Executive Chairman +44 (0) 20 7581 4477
Beaumont Cornish (Financial Adviser)
Roland Cornish +44 (0) 20 7628 3396
Novum Securities Limited (Broker)
Jon Belliss +44 (0) 20 7399 9400
or visit https://africanpioneerplc.com/
KEY HIGHLIGHTS
-- Consolidated total assets - GBP 6,148,119 (2020 - GBP 186,987)
-- Consolidated Profit/(Loss) - Profit - GBP 395,693 (2020 - Loss - (GBP90,156))
-- Raised gross proceeds of GBP1,750,000 at listing
-- The Group reports its results and raises funds in Pounds Sterling (GBP).
-- Its primary assets are in Namibia, Botswana and Zambia
CHAIRMAN' STATEMENT
Dear Shareholder
African Pioneer has made very positive start as a listed entity
and we are pleased with the progress made with the Company's
African copper and gold assets.
The Company's 85% owned Ongombo project in Namibia has benefited
from a resource upgrade during the period under review and a mining
licence application has been submitted for this project to the
ministry of mines and energy in Namibia. A drilling programme is
currently underway aimed at testing our prognosis that close to
surface mineralisation exists at Ongombo. I am pleased to report
that thedrill programme is progressing well and that several drill
holes within 10m of surface have intersected strong visual
mineralisation. The drill programme is on-going and we are eagerly
awaiting assay results for both copper and gold. We are optimistic
that we will have continued success with the drilling and that we
will be able to potentially increase strike and identify an open
pit production project with 2-3 year mine-life at Ongombo.
In Zambia, our North-western licences, are subject to an option
agreement with First Quantum Minerals Corp. ("First Quantum"), who
are one of the largest copper producers in the world and have a
strong presence in Zambia. First Quantum have a world class copper
producing project (Sentinel Mine) some 80 kilometres away from our
licence area and have excellent knowledge of the area as well as
many years of experience as mine operators in North Western Zambia
where our exploration licences are located. The geology in these
licences appears to resemble the geology usually encountered in the
Democratic Republic of Congo rather than what would be
traditionally expected in the Copperbelt, and consequently the
possibility of associated cobalt credits is potentially high. First
Quantum has carried out significant field work and we anticipate
that they will commence drilling in the third quarter of this year.
We are very excited for the potential for our Zambian licences and
we are confident that our partner, First Quantum, will do their
best endeavours to fast-track the exploration programme.
We are indeed fortunate that Sandfire Resources Limited
("Sandfire") subscribed for a 15% equity stake in African Pioneer
Plc when the Company listed on 1 June 2021. During the year, we
entered into a two-year option agreement with Sandfire in relation
to 4 of our 8 Botswana prospecting licences for a cash payment of
US$500,000 and the issue of 107,272 Sandfire shares and plus a 24
months exploration expenditure commitment from Sandfire of US$1
Million on the optioned licences.
The Option Agreement with Sandfire has allowed us to accelerate
exploration activities on the 4 Kalahari Copper Belt prospecting
licences that are subject of this Agreement whilst preserving the
Company's cash reserves. The funds received as part of the Option
Agreement has allowed us to accelerate exploration activities on
the Company's 4 other prospecting licences in Botswana and the
projects in Namibia and Zambia.
We have several other prospecting licences which we intend to
explore ourselves and plans have been made for drilling to commence
on some of these prospects during the second half of this year.
The Company's assets are very well placed in Southern Africa and
we are of the opinion that both Botswana and Namibia are sources of
tomorrow's copper production. Furthermore, all our exploration
projects have significant by-product potential, being cobalt in
Zambia, silver in Botswana and gold in Namibia.
The global outlook for copper is probably at its most favourable
for many years and there is a dearth of new projects to meet the
anticipated demand. The shortage is exacerbated by the projects
that are on the drawing board which are generally very large and
have a development period of more than 10 years and a huge capital
requirement, often in the billions of dollars, which is a challenge
even for the major mining companies.
At time of writing this report, the world is challenged by war,
famine, inflation, pandemics and is probably in the worst position
it has been in for many years. Despite the gloom, most commodities
are priced at the higher end of the spectrum, suggesting that the
economic outlook will improve going forward, and the commodity
producers will again be dominant in the foreseeable future.
Inflationary times are always positive for commodity prices and as
such we can expect that current metal prices will be resilient and
will possibly increase over the coming years.
In our opinion, African Pioneer is very well positioned, with
projects located in the right part of the world and in the right
commodities and should provide our shareholders with the potential
to achieve good returns on investment. I would like to thank my
fellow directors and management for their efforts in this post
listing phase and look forward to advancing all our projects and
releasing the value that they undoubtedly contain.
Colin Bird, Chairman
African Pioneer Plc
30 June 2022
BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Colin Bird - Executive Chairman
Colin Bird is a chartered engineer and a Fellow of the Institute
of Materials, Minerals and Mining with more than 40 years'
experience in resource operations management, corporate management
and finance. The formative part of his career was spent with the
National Coal Board in England where he was assistant underground
manager. He moved to the Zambian Copper Belt in 1970 as an
assistant underground manager before joining Anglo America Coal
Division in 1974 as section manager. He then moved to Botswana in
1979 to be mine manager of the BCL Nickel Copper Mine, a joint
venture between Anglo American Corporation, Amax and the Botswana
Government. On his return to the UK, he worked with Hampton Gold
Mine areas as a director of their coal mines in Scotland before
joining Costain Mining Ltd as technical director in 1987 and
thereafter Plateau Mining Plc as managing director in 1989. In 1993
he was appointed operations and technical manager for Petromin,
Saudi Arabia, of their gold mining activities with responsibility
for an underground mine producing 175,000oz of gold and three gold
mines in various stages of feasibility study and development. In
October 1995 he joined Lion Mining Finance Ltd in London as
technical manager and is now managing director and majority
shareholder of that company. Colin Bird founded and floated Jubilee
Metals Group Plc. He is Chairman and CEO of Galileo Resources Plc
and Chairman to Xtract Resources Plc. Colin serves on the board of
directors of Tiger Royalties and Investments Plc as Chairman, an
AIM listed Investment Company and shareholder in the Company. He is
also a member of the board of the TSX listed exploration company,
Revelo Resources Corp, formerly known as Polar Star Mining Corp,
where he served as CEO for a period as well. Mr Bird serves as
Executive Chairman of Bezant Resources Plc and Kendrick Resources
Plc. He founded and floated Kiwara Plc which discovered copper in
northwest Zambia. The company was sold for US$260 million to First
Quantum Corp. within 30 months of formation.
Raju Samtani - Finance Director
Raju is currently finance director of Tiger Royalties and
Investments Plc, listed on AIM. His previous experience includes
three years as Group Financial Controller at marketing services
agency WTS Group Limited, where he was appointed by the Virgin
Group to oversee their investment in the WTS Group Ltd. More
recently he was finance director of Kiwara Plc which was acquired
by First Quantum Minerals Ltd in January 2010. Over the last few
years, he has been involved in senior managerial positions for
several AIM/Johannesburg Stock Exchange listed companies
predominantly in the resource sector and has also been involved in
FCA compliance work within the investment business sector.
Christian Cordier - Business Development Director
Christian has had considerable involvement in corporate finance
and investments in both public and private mining and exploration
companies for over 22 years. His portfolio includes joint ventures
with major international mining houses, investments in listed
companies in the United Kingdom, Australia and Southern Africa as
well as private mining operations. He has extensive experience in
sourcing natural resource projects 1 12.1. a 40 and nurturing them
through the value curve by packaging and arranging venture funding,
managing the permitting and exploration process, negotiating
off-take agreements and the formation of a strong management team.
He worked as CFO and senior accountant as well as company secretary
for private and public companies and is a member of SA Institute
for Professional Accountants ("SAIPA"). Christian has done
transactions in Coal, Platinum Group Metals, Chrome, Copper,
Potash, Phosphates, Diamonds, Gold, Lithium and Manganese.
Christian focuses on business development and wealth creation for
private and publicly listed companies in the mining and exploration
sector.
Kjeld Thygesen - Independent Non-Executive Director
Kjeld Thygesen is mining investment veteran of more than 45
years. After being a mining analyst at James Capel in the latter
half of the 1970's he was manager of the commodities department at
Rothschild Asset Management between 1980-89. In 1990 he formed Lion
Resource Advisors as a specialist adviser in the mining and natural
resource sectors. LRA was the advisor to the Midas Fund in the US
between 1992 - 2000, which was one of the top performing finds
during that period. From 2002-2008 he was Investment director of
Resources Investment Trust, a London listed investment trust which
returned a threefold investment during that period. He has served
on several mining company boards over the past twenty years.
James Cunningham-Davis - Non-Executive Director
James Cunningham-Davis is a qualified Solicitor and a Fellow of
the Chartered Institute for Securities & Investment, founder of
the law firm Buckingham Legal and founder and Managing Director of
Cavendish Trust Company Ltd, and Cavendish Secretaries Limited, all
of which are headquartered in the Isle of Man. Cavendish Trust and
Cavendish Secretaries provide professional services to many private
companies and various listed companies, across a number of sectors
of industry and finance in many jurisdictions, though particularly
in the Natural Resources/Mining, Technology and Property sectors.
James has worked within the international legal and corporate
finance/service sectors for more than 25 years and has held many
directorships in both private and listed companies.
FINANCIAL CORPORATE AND OPERATIONAL REVIEW
INTRODUCTION
African Pioneer Plc a company engaging in development of natural
resources exploration projects in Sub-Saharan Africa presents its
year-end results for the year ended 31 December 2021.
The Directors are required to provide a year-end report in
accordance with the Financial Conduct Authorities ("FCA")
Disclosure Guidance and Transparency Rules ("DTR"). The Directors
consider this Financial, Corporate and Operational Review along
with the Chairman's Report, the Strategic Review and the Director's
Report provides details of the important events which have occurred
during the period and their impact on the financial statements as
well as the outlook for the Company going forward.
The Company's short to medium term strategic objectives are to
enhance the value of its mineral resource Projects through
exploration and technical studies conducted by the Company or
through joint venture or other arrangements (such as the Option
Agreement of selected Botswanan Projects with Sandfire Resources
Limited and also the more recent the option agreement with First
Quantum Corp on its 4 North-West Zambian licences) with a view to
establishing the Projects can be economically mined for profit.
With a positive global outlook for both base and precious metals,
the Directors believe that the Projects provide a base from which
the Company will seek to add significant value through the
application of structured and disciplined exploration.
Financial Review
Financial highlights:
-- Consolidated 396k profit after tax (2020: GBP(90)k - loss)
-- Approximately GBP1.19M cash at bank at the period end (2020: GBP88K).
-- The basic and diluted profit (losses) per share are summarised in the table below
Profit (Loss)
per share (pence)
Note
Basic 6 0.34p (0.77)p
Note
Diluted 6 0.29p (0.77)p
-- Net asset value as at 31 December 2021 was GBP6.06m (31 December 2020 GBP 87,114)
Fundraisings:
On 11 March 2021, the Company entered into a Convertible Loan
Note Subscription Agreement with Sandfire Exploration Limited,
listed on the Australian Stock Exchange ("Sandfire") under which
Sandfire subscribed for US$500,000 of interest free unsecured loan
notes, which upon listing was converted into Ordinary Shares
constituting 15 per cent. of the Company's issued share
capital.
At Listing the Company raised GBP1,750,000 (before expenses)
through the issue of 50,000,000 new ordinary shares of no par value
in the capital of the Company ("Ordinary Shares") at 3.5 pence per
Ordinary Share.
The funds raised on Admission provided the Group with sufficient
money to undertake the exploration and assessment of the Company's
licences in Namibia and Zambia and also in Botswana. Details of
these work programmes are set out in the Company's Prospectus dated
26 May 2021. As noted below, the funds received by the Company
under the Option Agreement with Sandfire for the Botswanan licences
are also available for the development of the Namibian and Zambian
Projects and the Botswanan licences retained by African Pioneer Plc
and/or further acquisitions as and when any may be identified.
Corporate Review
Company Board: The Board of the Company comprises Colin Bird,
Executive Chairman Raju Samtani, Finance Director Christian
Cordier, Business Development Director Kjeld Thygesen, Independent
Non-executive Director James Nicholas Cunningham-Davis,
Non-executive Director.
Listing: The Company was admitted to the Official List (Standard
Segment) and commenced trading on the Main Market for listed
securities of the London Stock Exchange on 1 June 2021 (the
"Listing" or "IPO") .
Corporate Acquisitions: At Listing the Company completed the
acquisition of projects based in Namibia, Zambia, and Botswana by
acquiring:
1) 100% of Zamcu Exploration Pty Ltd ("Zamcu"), for GBP 521,500
which was settled by the issue of 10M Ordinary Shares at 3.5 pence
per Share and a further 4.9M Ordinary Shares at 3.5 pence per Share
at Listing and in turn, Zamcu financed via a loan from APP paid a
cash sum of GBP149,149 plus GBP166,000 settled through for the
issue of 4,742,857 Ordinary Shares in APP at 3.5 pence per share
acquired a 70 per cent. interest in Manmar Investments 129 (Pty)
Ltd and Manmar Investments 136 (Pty) Ltd incorporating two Namibia
Exclusive Prospecting Licenses ("EPLs") located within the
Matchless amphibolite Belt of central Namibia (the "Namibian
Projects");
2) 80% of African Pioneer Zambia Limited ("APZ"), for
GBP1,925,000 which was settled by the issue of Ordinary Shares at
3.5 pence per share at Listing. APZ holds a 100 per cent. interest
in five Zambian Prospecting Licenses (PLs) located in two areas
namely the Central Africa Copperbelt (Copperbelt), which comprises
four PLs and the Zambezi area which comprises one PL (the "Zambian
Projects"); and
3) 100% of Resource Capital Partners Pty Ltd ("RCP"), for
GBP350,000 which was settled by the issue of Ordinary Shares at 3.5
pence per Share at Listing. RCP which holds a 100 per cent.
interest in eight Botswana Prospecting Licenses ("PLs") located in
two areas namely (1) the Kalahari Copperbelt (KC), which comprises
six PLs and (2) the Limpopo Mobile Belt (Limpopo), which comprises
two PLs (the "Botswanan Projects") (together the "Projects") (the
"Subsidiaries") (together the "Group").
Post Listing Agreements:
1) On 27 August 2021, Zamcu acquired a further 15% interest in
Manmar Investments 129 (Pty) Ltd and Manmar Investments 136 (Pty)
Ltd for a total consideration of AUS$528,000 in cash and the issue
of 2,248,295 Ordinary Shares in APP.
2) On 19 January 2022, the Company and its 80% owned subsidiary
African Pioneer Zambia Ltd ("African Pioneer Zambia") entered into
an option agreement with First Quantum Minerals Corp. ("First
Quantum") (listed on the Toronto Stock Exchange) in relation to 4
of the 5 Zambian exploration licences held by African Pioneer
Zambia (the "Option Agreement").
Lock Up and Orderly Market: All the Ordinary Shares issued to
vendors at Listing to acquire Zamcu, APZ and RCP were subject to a
12 month lock up from the IPO followed by a 12-month orderly market
arrangement.
Revised arrangements for exploration and potential Sale of
Kalahari Copper Belt Licences
On 2 October 2021, in place of the existing arrangements, APP
entered into a two year option agreement with ASX listed Sandfire
Resources Limited (ASX:SFR) ("Sandfire") in relation to 4 of its 8
Botswana prospecting licences for a cash payment of US$500,000 and
the issue of 107,272 Sandfire shares and a 24 months exploration
expenditure commitment of US$1,000,000 (the "Option Agreement").
The Company entered into the Option Agreement to allow an
acceleration of exploration activities on the 4 Kalahari Copper
Belt prospecting licences the subject of the Option Agreement (the
"Included Licences") funded by Sandfire.
Highlights of Option Agreement:
Pursuant to the Option Agreement on 8 October 2021 Sanddfire
made the following payments to African Pioneer:
1) US$500K was paid to the Group in cash in relation to the cash
component of the option fee for the right to acquire the Included
Licences; and
2) 107,272 Sandfire Ordinary shares ("Sandfire Shares") were
issued to the Company with a market value A$565K (approx. US$407K)
based on the closing Sandfire share price of A$5.27 per Sandfire
share on 1 October 2021 to settle the share component of the option
fee and a guarantee fee due to the Company. The Sandfire Shares do
not have any trading restrictions.
Exercise and Option Period: The option can be exercised within 2
years of the Option Agreement (the "Option Period") to acquire the
Included Licences for US$1. Sandfire has the right to extend the
Option Period by 1 year by the payment of a US$500,000 option
extension fee.
Exploration Commitment: Sandfire to fund US$1 million of
exploration expenditure by the Company on the Included Licences
(the "Exploration Commitment") within the Option Period and if the
US$1 million is not spent, any shortfall will be paid to African
Pioneer. Sandfire can withdraw from the Option Agreement at any
time after meeting the Exploration Commitment.
A Success Payment: a one-off success payment to be paid to the
Company for the first ore reserve reported under JORC Code 2012
edition on the Included Licences which exceeds 200,000 tonnes of
contained copper (the "First Ore Reserve") in the range of US$10
million to US$80 million depending on the amount of contained
copper in the First Ore Reserve (the "Success Payment").
Termination of Conditional Licence Sale Agreement: As a result
of entering into the Option Agreement the parties have terminated
the Conditional Licence Sale Agreement dated 12 March 2021 under
which Sandfire was due to acquire all 8 of the Company's 8 Botswana
prospecting licences for a cash payment of US$500,000 and the issue
of 107,272 Sandfire shares to the Company (the "Conditional Licence
Sale Agreement").
Further Information on Assets the subject of the Option
Agreement
The Company acquired its Botswanan Projects comprising 8
prospecting licences for GBP350,000 by acquiring Resources Capital
Partner Pty Ltd on 1 June 2021. Although unexplored, these licences
are located in an highly prospective area for copper projects and
it was the Company's original intention to conduct an initial 18
month exploration work programme to assess the prospectively of the
Botswanan Projects and assess the best way of developing them and
had earmarked US$176,000 in the Group's 18 month budget for this
purpose. The Option Agreement provides for Sandfire to fund
US$1,000,000 of exploration expenditure within 24 months on the
Included Licences which are the subject of the Option Agreement
which will significantly accelerate and increase the exploration
work undertaken on the Botswanan Projects.
Included Licences the subject of Retained Licences not the subject
the Option Agreement of the Option Agreement
PL 100/2020 PL 096/2020
PL 101/2020 PL 097/2020
PL 102/2020 PL 098/2020
PL 103/2020 PL 099/2020
Use of Option Payments: The payments from Sandfire under the
Option Agreement will allow the Group to concentrate its increased
financial resources and its management capabilities on its
remaining two projects in Namibia and Zambia and the 4 Botswana
prospecting licences that are not the subject of the Option
Agreement.
Operational Review
The period under review has been transformatory for the Company
in that the Company completed an Initial Public Offering (IPO) on
the Standard List of the London Stock Exchange and the acquisition
of its projects in Namibia, Zambia and Botswana more details of
which are provided in the Corporate Highlights section of this
review.
From the IPO the Group has been engaged in the advancement of
its natural resources exploration projects in Sub-Saharan
Africa.
Technical review of Projects: After the IPO and having acquired
its projects in Namibia, Zambia and Botswana,the Company commenced
technical reviews and / or programmes on its the projects located
in Namibia and Zambia. The primary metal in all countries is copper
with by-product potential in all of our projects. In Zambia we have
potential for cobalt, in Botswana for silver and in Namibia for
gold.
Namibia:
On 27 August 2021, the Group acquired a further 15% interest in
its Ongombo Project and Ongeama Project in Namibia (the "Namibian
Projects") increasing its interest in the Namibian Projects to 85%.
On 20 December 2021 the Company announced a 3.76 Mt increase in the
Measured & Indicated Mineral Resources of the Ongombo Project
Mineral Resources to 10.47Mt @ 1.4% Cu, 7g/t Ag at a cut-off of
1.0% Cu, with 0.35g/t Au categorised as Inferred following a JORC
(2012) compliant review by external consultant, Red Bush Analytics,
the submission of a mine application and a positive scoping study
by Practara Consulting.
-- Positive Scoping Study Conclusions : The base case of the
Scoping Study by Mine design specialists, Practara Consulting,
generated a post-tax NPV of US$39 million using a 10% discount rate
and an IRR of 27.7%, with payback from first production estimated
to be 2.4 years. Practara considers that the economic study for
Ongombo meets the "Criteria for Reasonable Prospects for Eventual
Economic Extraction".
-- Mining Licence submitted: A Mining Licence application has
been submitted to the Ministry of Mines and Energy of Namibia.
Follow-up detailed mine layout and mine scheduling review is being
undertaken by external consultants Practara Consulting and Nurizon
Consulting Engineers with emphasis on assessing the initial Life of
Mine and the development of the Central Shoot
-- Metallurgical test work: Metallurgical test work has
commenced on historic samples and new samples will be taken as part
of the planned drill programme
Environmental and Social Impact Assessment (ESIA): More detailed
ESIA studies completed and we have commenced community
consultation.
On 24 May 2022, a shallow diamond drilling programme commenced
on the Ongombo Project, Namibia.
Highlights of the programme are as follows:
-- 25 to 30-hole shallow diamond drill programme has commenced on the Ongombo Project
-- 6 holes completed to date with all holes intersecting
encouraging sulphide mineralisation with chalcopyrite at shallow
depths
-- Visual estimates of chalcopyrite content in the mineralised
zones indicate notable quantities of copper sulphide to date
-- Drill programme designed to test near-surface oxide and sulphide copper-gold mineralisation
-- Work also underway to resample historic drill core to test
for elevated gold values in and around copper mineralisation
Ongombo Project Near-surface Drill Programme
Six holes have been completed to date. Assessment of the
potential of the mineralised zone at this stage in the evaluation
process is based on visual estimates of copper sulphide content,
occurring as chalcopyrite and relies on the experience of the
geologist managing the drilling programme and logging core to
assess the proportion of visible chalcopyrite relative to pyrite
and other minerals making up the mineralised horizon.
Visual estimates of copper content do not reflect the expected
assay grade of the mineralised horizon but do indicate the extent
of chalcopyrite mineralisation.
Table 1: Mineralised Widths of First Six Drillholes Completed on
Near-Surface Drill Programme on the Ongombo Project
Hole ID From To Mineralised* End Of Hole
(m) (m) Width (m)
(m)
APD001 11.81 14.81 3.0 17.45
------ ------ ------------- ------------
APD002 21.27 22.27 1.0 29.78
------ ------ ------------- ------------
APD003 7.30 11.86 4.56 17.86
------ ------ ------------- ------------
APD004 20.59 21.50 0.91 26.83
------ ------ ------------- ------------
APD005 11.4 13.05 1.65 17.81
------ ------ ------------- ------------
APD006 36.5 38.1 1.60 56.99
------ ------ ------------- ------------
The gossanous outcrop at Ongombo has been assumed to be the
surface expression of the mineralisation drilled at depth to
generate the current Ongombo Mineral Resource Estimate. African
Pioneer has projected this same mineralisation to extend to surface
through to the gossan outcrop. It has been assumed that previous
exploration drilling ignored the near-surface potential on the
basis that copper oxide mineralisation, at the time that Gold
Fields Namibia Limited was exploring, was not conducive to good
metal recover. Today however, flotation processing has the capacity
to recover economic quantities of oxide and sulphide copper in
parallel in the same flotation processing plant making any shallow
mineralisation a valid target for development. African Pioneer will
test the shallow mineralisation potential over a strike length of
approximately 1 kilometre and down dip of the gossan outcrop to the
point where historic drilling occurs.
Assessment of Gold Grades in Historic Drill Core
Approximately 80 drillholes have been found that were completed
by previous explorers including Gold Fields Namibia Limited. The
Company intends to resample the drill core in and around the
mineralised horizon in each case in order to assess the
distribution of gold attributable to the existing Mineral Resource
Estimate.
Historically limited gold assaying was undertaken, so only
low-grade gold values have been reported as any grade less than
1g/t Au was considered insignificant, particularly when exploration
was being undertaken by South African companies more used to
significantly higher gold grades on their deep level gold mines and
as a consequence, only. At the current gold price, and in
conjunction with known copper grades, there is scope for an
important by-product addition of gold in the Mineral Resource. A
greater density of gold assay data covering the existing Mineral
Resource generated by resampling of available core has the scope to
add to the value of each tonne of ore defined to date.
Zambia :
Post year-end, On 19 January 2022 the Company's 80% owned
subsidiary African Pioneer Zambia Ltd ("African Pioneer Zambia")
entered into an option agreement with First Quantum Minerals Ltd
("First Quantum") (listed on the Toronto Stock Exchange FM.TO) in
relation to 4 of the 5 Zambian exploration licences held by African
Pioneer Zambia (the "Option Agreement").
Highlights of the Option Agreement:
-- The four exploration licences the subject of the Option
Agreement are in the highly prospective Central Africa Copperbelt
in northwest Zambia which is the largest and most prolific
mineralized sediment- hosted copper province in the world and are
located less than 100km from First Quantum's giant Sentinel copper
mine.
-- The exploration licenses include geological formations
similar in age and rock type to that hosting the major copper
deposits of the Copperbelt.
-- During the initial 18 month option period First Quantum has
the right but not the obligation to spend US500,000 on each of the
exploration licences 27767-HQ-LEL, 27768-HQ-LEL, 27770-HQ-LEL, and
27771-HQ-LEL (the "Zambian Projects"). At this stage First Quantum
will not have earned any shares in African Pioneer Zambia, just the
right to proceed to take one or more of the properties into the
First Earn In Period by issuing an Option Exercise Notice.
-- During the First Earn In Period, First Quantum then has 2
years when it has the right but not the obligation to prepare a
Technical Report in respect of the Zambian Projects demonstrating
an Indicated Mineral Resource of at least 300,000 tonnes of
contained copper (the "Technical Report Requirement"). First
Quantum is to fund the Technical Report. Once the Technical Report
is issued First Quantum has the right to be issued shares equal to
a 51% shareholding in African Pioneer Zambia. This will also
trigger the Second Earn-In Period.
-- In the Second Earn-In Period First Quantum shall have the
right but not the obligation to complete all necessary mining,
metallurgical and development studies to establish a mine at the
Property and make a public announcement that it intends to proceed
towards commercial development of a Mine on the Property (a
"Decision to Mine"). First Quantum is to fund
FINANCIAL CORPORATE AND OPERATIONAL REVIEW (Continued)
all costs related to the Decision to Mine. Once First Quantum
announces a Decision to Mine First Quantum has the right to be
issued shares in African Pioneer Zambia to increase their 51%
shareholding in African Pioneer Zambia to 75%.
Botswana:
On 4 October 2021 the Company announced that in place of the
existing arrangements, it had on 2 October 2021 entered into a
two-year option agreement with ASX listed Sandfire Resources
Limited (ASX:SFR) ("Sandfire") in relation to 4 of its 8 Botswana
prospecting licences for a cash payment of US$500,000 and the issue
of 107,272 Sandfire shares (share price on 3 May 2022 - A$5.60 -
approx. GBP3.17) and a 24 months exploration expenditure commitment
of US$1,000,000 (the "Option Agreement"). The Company has entered
into the Option Agreement to allow an acceleration of exploration
activities on the 4 Kalahari Copper Belt prospecting licences the
subject of the Option Agreement (the "Included Licences") funded by
Sandfire. Funds received will also allow the Company to accelerate
exploration activities on the Company's 4 other prospecting
licences in Botswana and its projects in Namibia and Zambia.
Outlook
Outlook for Copper: Although the price of copper has corrected
slightly in the period post year-end as a result of higher interest
rates recently implemented by western governments and due to the
ongoing geopolitical tensions, forecasts for the price of copper
and its by-product metals remain positive. The outlook for copper
supply is quite bleak and we are likely to see more smaller mines
being developed since most large copper mining projects have been
shelved as a result of political or economic reasons. As a result,
the Company is well positioned with all its projects, to take part
in a potential acquisition boom or alternatively to attract
financing which might not otherwise have been available.
The major mining companies are seeking new projects for
acquisition and all our projects have the fundamentals which may
attract the attention of larger companies. We have already entered
into an agreement with Sandfire in relation to the Botswana
Projects.
We feel that there is a strong possibility that the current
inflationary pressures and higher interest rates may slow down
stock markets but these conditions will be beneficial for the
smaller metal producers who have historically outperformed under
these economic conditions.
The Board feels the Group has assembled an enviable portfolio of
projects and we are pleased that Sandfire has taken an equity
position in the Company. We look forward to advancing all our
projects in the second half and providing our shareholders with the
prospects of enhanced value flowing into next year.
By Order of the Board
30 June 2022
DIRECTORS' REPORT
The directors present their report on the affairs of African
Pioneer Plc (the "Company") for the year ended 31 December 2021.
The Company was incorporated on 20 July 2012.
PRINCIPAL ACTIVITIES
The principal activity of the Company and its subsidiaries (the
"Group") is the exploration for base metals in Zambia, Namibia and
Botswana.
Investing in small natural resource projects and mineral
exploration projects can be very rewarding, but because of the
issues and uncertainties arising from exploration, resource
estimation, commodity price volatility, politics and the financing
of such projects, there is a significant possibility of such reward
not materialising. As a result of the nature and size of the
Company it will, in the early years particularly, be exposed to a
concentration of risk either by sector or geographically, or
possibly both. These risks are outlined in more detail in the
Strategic Report.
REVIEW OF THE BUSINESS
During the year, the Group made a profit of GBP395,693 - 2020:
loss of GBP (90,156).
A review of the current and future development of the Group's
business are included in the Strategic Report.
The Directors do not recommend the payment of a dividend.
SUBSEQUENT EVENTS
Details of subsequent events after the year end are disclosed in
note 17 to the financial statements
DIRECTORS
The names of the Directors who served throughout the period and
subsequent to the year end, except where shown otherwise, are as
follows:
C Bird
R. Samtani
C Cordier (appointed
1 June 2021)
K Thygesen (appointed
1 June 2021)
J Cunningham-Davis
Directors' interests in the ordinary share capital of the
Company at the date of this report are disclosed within the
Directors Remuneration Report
DIRECTOR'S REMUNERATION
The Directors' remuneration is detailed in the Directors'
Remuneration Report on pages 17 to 19
DIRECTORS' AND OFFICERS' INDEMNITY INSURANCE
The Group has purchased Directors' and Officers' liability
insurance which provides cover against liabilities arising against
them in that capacity.
USE OF FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT
Details of the use of financial instruments and associated risk
management by the Group are included in note 3 to the financial
statements.
SUBSTANTIAL SHAREHOLDINGS
Other than Directors interests which are set out below on a
separate table in this report, the following shareholders held 3%
or more of the issued share capital of the Company at 31 December
2021. These holdings are extracted as they appear in the relevant
custodian account in the Company's share register.
Party Name Number of ordinary % of share capital
shares
The Bank of New York (Nominees)
Limited* 41,732,143 21.77
Sandfire Resources Limited 28,418,932 14.82
HSBC Global Custody Nominee
(UK) Limited* 22,014,641 11.48
JIM Nominees Limited* 21,272,474 11.09
Mohamad Ahmad 15,000,000 7.82
ISI Nominees Limited* 9,285,714 4.84
Wilhelm Shali 7,124,675 3.72
*Nominee shareholder; not beneficial owner.
ENERGY CONSUMPTION
The Company consumed less than 40MWh during the period and as
such is a Low Energy User as defined in the Environmental Reporting
Guidelines Including streamlined energy and carbon reporting
guidance March 2019 (Updated Introduction and Chapter 1) and as
such is not required to provide detailed disclosures of energy and
carbon information. The company was below this threshold in
2020.
POLITICAL DONATIONS
The Group made no political donations during the year (2020:
none).
STATEMENT AS TO THE DISCLOSURE OF INFORMATION TO THE
AUDITORS
The Directors (being Colin Bird, Raju Samtani, Christian
Cordier, Kjeld Thygesen and James Cunningham-Davis, who were in
office at the date of approval of this report, confirm that, so far
as they are aware, there is no relevant audit information of which
the Company's auditor is unaware of and that they have taken all
reasonable steps to take themselves aware of any relevant audit
information and to establish that the Company's auditor is aware of
that information.
The Directors are responsible for preparing the financial
statements in accordance with the Disclosure and Transparency Rules
of the United Kingdom's Financial Conduct Authority ("DTR") and
with International Financial Reporting Standards as adopted by the
United Kingdom.
The Directors confirm to the best of their knowledge that:
-- the financial statements have been prepared in accordance
with the relevant financial reporting framework and give a true and
fair view of the assets, liabilities, financial position and profit
or loss of the Group and the Company; and
-- the Strategic Report and Directors' Report include a fair
review of the development and performance of the business and the
financial position of the Group and the Company, together with a
description of the principal risks and uncertainties that it faces;
and
-- the annual report and financial statements, taken as a whole,
are fair, balanced, and understandable and provide the information
necessary for shareholders to assess the Group's position,
performance, business model and strategy.
AUDITORS
The auditors, Shipleys LLP have indicated their willingness to
continue in office. A resolution to re-appoint them will be
proposed at the forthcoming Annual General Meeting.
Signed on behalf of the Board:
30 June 2022
Colin Bird Raju Samtani
Non-Executive Chairman Director
DIRECTORS' REMUNERATION REPORT
This Remuneration Report sets out the Group's policy on the
remuneration of Directors, together with details of Directors'
remuneration packages and service contracts for the year ended 31
December 2021.
The Company's policy is to maintain levels of remuneration to
attract, motivate, and retain Directors and Senior Executives of
the highest calibre who can contribute their experience to deliver
industry-leading performance with the Company's operations. The
Company is nonetheless mindful of the need to balance this
objective with the fact that it is pre-revenue.
Since listing on 1 June 2021, the Company's Directors have
largely remunerated through a combination of modest salaries and/or
fees and where relevant, equity positions as founders and as a
result the total salaries and fees payable to directors has been
relatively modest.
As the Company grows, and increasingly makes hires, it will
become necessary to move to a more long-term and sustainable
policy, which continues to align the interests of Directors and
senior staff with those of shareholders while recognising that new
hires will not initially have a significant equity position.
Accordingly, it is likely that compensation packages for
Executive Directors will need to move over time to a level more
consistent with the market. Currently, Directors' remuneration is
not subject to specific performance targets. The Company is
sufficiently small that the Board does not consider that it is
necessary to impose such targets as a matter of principle but
believes that exceptional performance can be rewarded on an ad hoc
basis.
The Board intends to adopt a share option scheme which to
incentivise both Executive and non-Executive Directors as well
individuals holding positions of responsibility in the Company.
The Board considers the remuneration of Directors and senior
staff and their employment terms and makes recommendations to the
Board of Directors on the overall remuneration packages. No
Director takes part in any decision directly affecting their own
remuneration.
There has been no correspondence to date from shareholders
relating to Directors' remuneration matters and therefore no such
matters have been considered by the Board in formulating the
Company's remuneration policy.
In determining Executive Director remuneration policy and
practices, the Board aims to address the following factors:
-- Clarity - remuneration arrangements should be transparent and
promote effective engagement with shareholders and the
workforce;
-- Simplicity - remuneration structures should avoid complexity
and their rationale and operation should be easy to understand;
-- Risk - remuneration arrangements should ensure reputational
and other risks from excessive rewards, and behavioural risks that
can arise from target-based incentive plans, are identified and
mitigated;
-- Predictability - the range of possible values of rewards to
individual directors and any other limits or discretions are
identified and explained at the time of approving the policy;
-- Proportionality - the clarity of the link between individual
awards, the delivery of strategy and the long-term performance of
the company should be clear; and
-- Alignment to culture - incentive schemes, when implemented
will drive behaviours consistent with company purpose, values and
strategy.
Directors' remuneration
Remuneration of the Directors for the years ended 31 December
2021 and 2020 was as follows:
2021 2021 2021 2020
Directors' Consulting Total Total
Fees Fees Emoluments Emoluments
GBP GBP GBP GBP
C. Bird 10,500 24,500 35,000 -
R. Samtani 10,500 18,669 29,169 -
C Cordier 10,500 6,000 16,500 -
K Thygesen 10,500 - 10,500 -
James Cunningham-Davis 9,300 - 9,300 3,600
Total 51,300 49,169 100,469 3,600
------------- ------------- ------------ ------------
Each of the Directors entered into service agreements at the
time of the Company's admission to the market on 1 June 2021.
Details of Directors' Letters of Appointment and Service Agreements
as disclosed in Note 16 of these Financial Statements.
There were no pensions or other similar arrangements in place
with any of the Directors during the years ended 31 December 2021
or 2020.
Payments to past directors
The Company has not paid any compensation to past Directors.
DIRECTORS' INTERESTS
The beneficial interest of the directors, their spouses and
minor children in the share capital of the Company are as
follows:
Ordinary Shares of No Par Value
31 December 2021 31 December 2020
C Bird* 21,061,728 1,061,728
R Samtani 16,061,728 1,061,728
J Cunningham-Davis*** - -
C Cordier** 15,000,000 -
K Thygesen 200,000 -
* Colin Bird's shareholding includes 5,000,000 ordinary shares
held by Campden Park Trading, a company owned and controlled by
Colin Bird , the Company's Chairman
** Christian Cordier's shareholding includes 4,000,000 ordinary
shares held by Tonehill Pty Ltd and 3,000,000 ordinary shares held
by Coreks Super Pty Ltd both of which companies are owned and
controlled by Christian Cordier. It also includes 8,000,000
ordinary shares held by Breamline Pty Ltd of which Christian
Cordier is a director and which is a trustee company for Breamline
Ministries.
*** 230,000 warrants are held by Cavendish Trust of which James
Cunningham -Davis is a director
There have been no further changes in directors' interests since
the year end.
Other matters
The Company does not currently have any annual or long-term
incentive schemes in place for any of the Directors and as such
there are no disclosures in this respect.
Approved by the Board on 30 June 2021.
GOVERNANCE REPORT
Corporate Governance
The Board guides and monitors the business and affairs of the
Company on behalf of the Shareholders to whom it is accountable and
is responsible for corporate governance matters. While certain key
matters are reserved for the Board, it has delegated
responsibilities for the day-to-day operational, corporate,
financial and administrative activities to the Business Development
Director, the Executive Chairman and the Finance Director.
In assessing the composition of the Board, the Directors have
had regard to the following principles:
-- the role of the Executive Chairman and the other directors
should not be exercised by the same person;
-- the Board should include at least one independent
non-executive director, increasing where additional expertise is
considered desirable in certain areas, or to ensure a smooth
transition between outgoing and incoming non-executive directors;
and
-- the Board should comprise of directors with an appropriate
range of qualifications and expertise.
The Company believes it complies with each of these
principles.
Both James Cunningham-Davis and Kjeld Thygesen are the
Non-Executive Directors of the Company. James Cunningham-Davis is
one of the directors of Cavendish Secretaries Limited, a subsidiary
of Cavendish Trust Company Limited, which provides secretarial
services to the Company in the Isle of Man and is therefore for
these purposes not considered independent.
Kjeld Thygesen has a holding of Ordinary Shares representing
0.14 per cent. of the Enlarged Share Capital on Admission but he is
considered independent given this holding is de minimis.
Directors appointed by the Board are subject to election by
shareholders at the Annual General Meeting of the Company following
their appointment and thereafter are subject to re-election in
accordance with the Company's Articles of Association.
The QCA Corporate Governance Code, as published by the Quoted
Companies Alliance, is tailored for small and mid-size quoted
companies in the United Kingdom. The Company will, to the extent
practicable for a company of its size and nature, follow the QCA
Corporate Governance Code. The Directors are aware that there are
currently certain provisions of the QCA Corporate Governance Code
that the Company is not in compliance with, given the size and
early stage nature of the Company. These include, inter alia:
-- The Company does not currently have a remuneration,
nomination or risk committee. The Board as a whole will review
remuneration, nomination and risk matters, on the basis of adopted
terms of reference governing the matters to be reviewed and the
frequency with which such matters are considered. The Board as a
whole will also take responsibility for the appointment of auditors
and payment of their audit fee, monitor and review the integrity of
the Company's financial statements and take responsibility for any
formal announcements on the Company's financial performance.
-- Unless further independent non-executive directors are
appointed, the Board will not comply with the provision of the QCA
Corporate Governance Code that at least to members of the Board,
excluding the Chairman, should comprise non-executive directors
determined by the Board to be independent.
-- The Executive Chairman of the Company is an executive
director rather than an independent non-executive director as
suggested by the QCA corporate governance code.
Share Dealing Code
The Company has adopted, with effect from Admission, a share
dealing policy regulating trading and confidentiality of inside
information for the Directors and other persons discharging
managerial responsibilities (and their persons closely associated)
which contains provisions appropriate for a company whose shares
are admitted to trading on the Official List (particularly relating
to dealing during closed periods which will be in line with the
Market Abuse Regulation). The Company will take all reasonable
steps to ensure compliance by the Directors and any relevant
employees with the terms of that share dealing policy.
Audit Committee
The Audit Committee is chaired by James Cunningham-Davis and its
other member is Christian Cordier. The Audit Committee meets at
least twice a year, or more frequently if required. The Audit
Committee is be responsible, amongst other things, for making
recommendations to the Board on the appointment of auditors and the
audit fee, monitoring and reviewing the integrity of the Company's
financial statements and any formal announcements on the Company's
financial performance as well as reports from the Company's
auditors on those financial statements.
In addition, the Audit Committee considers and reviews the
Company's internal financial control and risk management systems to
assist the Board in fulfilling its responsibilities relating to the
effectiveness of those systems, including an evaluation of the
capabilities of such systems in light of the expected requirements
for any specific acquisition target.
Meetings of the Directors
The number of meetings of the board of directors of the Company
and its committees held during the year ended 31 December 2021 and
the number of meetings attended by each director is tabled below.
The audit committee was formed on 26 May 2021 prior to the
Company's listing on the London Stock Exchange
2021
Meetings whilst No. of meetings
in office attended
Board Audit Board Audit
-------- -------- -------- --------
C. Bird 3 - 3 -
-------- -------- -------- --------
R. Samtani 3 - 3 -
-------- -------- -------- --------
J. Cunningham-Davis 3 1 3 1
-------- -------- -------- --------
K Thygesen
* 2 - 2 -
-------- -------- -------- --------
C. Cordier
* 2 1 2 1
-------- -------- -------- --------
-- Appointed 26 May 2021
Diversity Policy
The Board operates a policy whereby Directors and other
individuals considered for employment and professional services
across the Group are selected on the basis of their experience,
professional qualifications and ability and a such the Company does
not discriminate on aspects such as age, gender or educational and
professional background.
The Company's employees comprising of the 5 Board Directors are
all male.
Internal control
The Board is responsible for establishing and maintaining the
Group's system of internal control. Internal control systems manage
rather than eliminate the risks to which the Group is exposed and
such systems, by their nature, can provide reasonable but not
absolute assurance against misstatement or loss.
There is a continuous process for identifying, evaluating and
managing the significant risks faced by the Group. The key
procedures which the Directors have established with a view to
providing effective internal control, are as follows:
..Identification and control of business risks The Board
identifies the major business risks faced by the Group and
determines the appropriate course of action to manage those
risks.
.. Budgets and business plans Each year the Board approves the
business plan and annual budget. Performance is monitored and
relevant action taken throughout the year through the regular
reporting to the Board of changes to the business forecasts.
.. Investment appraisal Capital expenditure is controlled by
budgetary process and authorisation levels. For expenditure beyond
specified levels, detailed written proposals must be submitted to
the Board. Appropriate due diligence work is carried out if a
business or asset is to be acquired.
Environment, health, safety and community statement
The Group is committed to providing a safe working environment
for all its employees and to responsibly manage all of the
environmental interactions of its business. Its objective is to
perform and achieve at a level notably in excess of the regulatory
minima required by the host countries in which it does
business.
The following specific principles are adhered to by the
Group:
Health & Safety
-- Provision of health and safety training to all employees;
-- All necessary measures are taken to minimise workplace
injuries, and
-- Establishment of management and advisory programmes for the
prevention of transmissible diseases.
Environment
The Group prides itself on being a skilled and responsible
operator. It functions with the clear mandate of being in full
compliance with corporate standards, applicable environmental laws,
regulations and permit requirements. It has an internal monitoring
programme in place that plays a critical role in continuously
improving its environmental performance.
The Group strives to minimise its environmental effects wherever
and to:
-- Comply with applicable laws, regulations and commitments wherever it operates;
-- Ensure it has the necessary resources, procedures, training
programmes and responsibilities in place to achieve its
environmental objectives;
-- Strive to protect air and water quality, minimise consumption
of water and energy, and protect natural habitats and
biodiversity;
-- Promote an ongoing environmental dialogue with its
stakeholders in the communities where it conducts business;
-- Collaborate with stakeholders to define environmental
priorities and to protect the environment, and
-- Consider the requirement for environmental protection in all
aspects of exploration and development.
Communities
As well as recognising the need to protect the natural
environment the Group will follow Best Practices in:
-- its interactions with local communities,
-- respecting customs and cultural practices, and -- minimising
intrusion upon lifestyles and traditions.
The Group will not violate human rights and will, wherever
possible, favour employment for local people when it recruits. It
will strive to be recognised as a socially aware and responsible
business
STRATEGIC REPORT
The Directors present their strategic report on the group for
the year ended 31 December 2021.
PRINCIPAL ACTIVITY
African Pioneer Plc ("the Company") is a public limited company
which is listed on the main market of the London Stock Exchange and
incorporated and domiciled in the Isle of Man. The Company's
registered address is 34 North Quay, Douglas, Isle of Man, IM1
4LB.
The Company is the parent company of African Pioneer Zambia Ltd,
Resource Capital Partners Pty Ltd and Zamcu Exploration Pty Ltd,
which has an 85% equity holding in Manmar Investments One Hundred
and Twenty Nine (Pty) Ltd and Manmar Investments One Hundred and
Thirty Six (Pty) Ltd. (see note 10 for further details).
The principal activity of the Company and its subsidiaries (the
"Group") is the exploration for base metals in Zambia, Namibia and
Botswana.
GOING CONCERN
As disclosed in Note 2, the Directors have a reasonable
expectation that the Company has adequate resources to continue in
operational existence for a period of at least, but not limited, 12
months from the date of approval of the financial statements. For
these reasons, the Directors continue to adopt the going concern
basis in preparing the financial statements
KEY PERFORMANCE INDICATORS
The key performance indicators in assessing the completion of
this activity are monitored on a regular basis:
-- Progress with exploration, monitoring licence commitments and
environmental compliance; and
-- Cash management - ensuring that the Company is well funded
and has adequate cash to meet to meet its obligations as they fall
due.
REVIEW OF THE BUSINESS
Details of the Company's strategy, results and prospects are set
out in the Chairman's Statement and in the Operations Report on
pages 7 to 13.
On 1 June 2022 the Company completed the placing of 50,000,000
new Ordinary Shares and raised gross proceeds of GBP1,750,000.
Financial highlights:
-- GBP395k consolidated profit after tax (2020: GBP(90)k - loss)
-- Approximately GBP1.19M cash at bank at the year-end (2020: GBP88k).
-- The basic and diluted losses per share are summarised in the table below
Profit/(Loss)
per share (pence)
Note
Basic 6 0.34p (0.77)p
Note
Diluted 6 0.29p (0.77)p
-- The net asset value of the Group at as at 31 December 2021
was GBP6.1M (31 December 2020 - GBP87K)
INVESTMENTS HELD BY THE COMPANY FOR RESALE
At year-end, the Group held investments in five companies
classified as available-for-sale investments and valued at
GBP502,456 and had a cash balance of GBP1,190,979. The Group is
able to raise additional cash at short notice by selling its
investments which are liquid. It is the Group's intention not to
purchase any new investments and to hold its residual portfolio as
realisable investments as a source of liquidity to cover
explorations costs and general overheads of the Group.
PORTFOLIO HOLDING AT 31 December 2021
Number Cost Valuation Valuation
31/12/21 31/12/21 31/12/21 31/12/20
Jubilee Metals Group Plc 217,802 8,266 35,393 27,770
Galileo Resources Plc 2,500,000 50,000 24,500 41,250
Sandfire Resources Ltd 107,272 302,960 379,489 -
South 32 Limited 13,845 28,607 30,044 19,297
Xtract Resources Plc 606,060 20,217 33,030 10,788
-------- --------- -------
TOTAL FOR AFRICAN PIONEER
PLC 410,050 502,456 99,105
-------- --------- -------
PRINCIPAL RISKS AND UNCERTAINTIES
This business carries a high level of risk and uncertainty,
although the potential rewards can be outstanding. The Directors
have identified the following principal risks in regards to the
Group's future. The relative importance of risks faced by the Group
can, and is likely to, change as the Group executes its strategy
and as the external business environment evolves.
Strategic risk
The Group's strategy may not deliver the results expected by
shareholders. The Directors regularly monitor the appropriateness
of the strategy, taking into account both internal and external
factors, together with progress in
implementing the strategy and modify the strategy as may be
required based on developments and exploration results. Key
elements of this process are the Group's monthly reporting and
regular Board meetings.
Exploration risk
Exploration at the Namibia, Zambia and Botswana Projects may not
result in success.
Whilst the Directors endeavour to apply what they consider to be
the latest technology to assess projects, the business of
exploration for and identification of minerals and metals, is
speculative and involves a high degree of risk. The mineral and
metal potential of the Group's initial projects, Namibia and
Zambia, may not contain economically recoverable volumes of
minerals, base metals, or precious metals of sufficient quality
or quantity. To mitigate this risk, the Group has acquired the
rights to carry out exploration and earn an interest in certain
licences in the specific areas.
Even if there are economically recoverable deposits, delays in
the construction and commissioning of mining projects or other
technical difficulties may make the deposits difficult to exploit.
The exploration and development of any project may be disrupted,
damaged or delayed by a variety of risks and hazards which are
beyond the control of the Group. These include (without limitation)
geological, geotechnical and seismic factors, environmental
hazards, technical failures, adverse weather conditions, acts of
God and government regulations or delays.
Exploration is also subject to general industrial operating
risks, such as equipment failure, explosions, fires and industrial
accidents, which may result in potential delays or liabilities,
loss of life, injury, environmental damage, damage to or
destruction of property and regulatory investigations. The Group
may also be liable for the mining activities of previous miners and
previous exploration works. Although the Group intends, itself or
through its operators, to maintain insurance in accordance with
industry practice, no assurance can be given that the Group or the
operator of an exploration project will be able to obtain insurance
coverage at reasonable rates (or at all), or that any coverage it
obtains will be adequate and available to cover any such claims.
The Group may elect not to become insured because of high premium
costs or may incur a liability to third parties (in excess of any
insurance cover) arising from pollution or other damage or
injury.
Environmental and other regulatory risks
In relation to the Group's existing projects the environmental
impact to date is limited to activities associated with
exploration. The ultimate development of any project into a mining
operation will inevitably impact considerably on the local
landscape and communities. These projects sit in an area of
considerable natural beauty and therefore there is likely to be
opposition to mining by some parties. This may impact on the cost
and/or Group's ability to sell or move these projects into
production.
While the Group believes that its operations and future projects
are currently, and will be, in substantial compliance with all
relevant material environmental and health and safety laws and
regulations, including relevant international standards, there can
be no assurance that new laws and regulations, or amendments to, or
stringent enforcement of, existing laws and regulations will not be
introduced.
Nevertheless, the Group will continue to vigorously apply
international standards to the design and execution of any and all
of its activities, including engagement and consultation with local
communities, and non-governmental and Governmental organisations to
ensure any impacts of current and future activities are minimised
and appropriately managed. The Group has organisations to ensure
any impacts of current and future activities are minimised and
appropriately managed. The Group has established a comprehensive
suite of health, safety, environmental and community policies which
will underpin all future activities.
Financing
The successful exploration or exploitation of natural resources
on any project will require significant capital investment. The
only sources of financing currently available to the Group are
through the issue of additional equity capital in the
Company or through bringing in partners to fund exploration and
development costs. The Group's ability to raise further funds will
depend on the success of their investment strategy and conditions
in financial and commodity markets. The
Group may not be successful in procuring the requisite funds on
terms which are acceptable to it (or at all) and, if such funding
is unavailable, the Group may be required to reduce the scope of
its investments or anticipated expansion.
Political, economic and regulatory regime
The licences and operations of the Group are in jurisdictions
outside the United Kingdom and accordingly there will be a number
of risks which the Group will be unable to control. Whilst the
Group will make every effort to ensure it has robust commercial
agreements covering its activities, there is a risk that the
Group's activities will be adversely affected by economic and
political factors such as the imposition of additional taxes and
charges, cancellation or suspension of licences and changes to the
laws governing mineral exploration and operations.
The Group's activities will be dependent upon the grant of
appropriate licences, concessions, leases, permits, and regulatory
consents that may be withdrawn or made subject to limitations.
There can be no assurance that they will be granted or renewed or
if so, on what terms. There is also the possibility that the terms
of any licence may be changed other than as represented or
expected.
The current focus of the Group's activities, offer stable
political frameworks and actively support foreign investment. The
countries have well-developed exploration and mining code and
proactive support for foreign companies. Through a programme of
proactive engagement with each Government at all levels the Group
is able to partially mitigate these risks by establishing
professional working relationships.
Dependence on key personnel
The Group is dependent upon its executive management team and
various technical consultants. Whilst it has entered into
contractual agreements with the aim of securing the services of
these personnel, the retention of their services cannot be
guaranteed. The development and success of the Group depends on its
ability to recruit and retain high quality and experienced staff.
The loss of the service of key personnel or the inability to
attract additional qualified personnel as the Group grows could
have an adverse effect on future business and financial conditions.
Nevertheless, through programmes of incentivising staff,
appropriate succession planning, and good management these risks
can be largely mitigated.
Uninsured risk
The Group, as a participant in exploration and development
programmes, may become subject to liability for hazards that cannot
be insured against or third party claims that exceed the insurance
cover. The Group may also be disrupted by a variety of risks and
hazards that are beyond its control, including geological,
geotechnical and seismic factors, environmental hazards, industrial
accidents, occupation and health hazards and weather conditions or
other acts of God.
Other business risks
In addition to the current principal risks identified above and
those disclosed in note 3 to the financial statements, the Group's
business is subject to risks relating to the financial markets and
commodity markets. The buoyancy of both the aforementioned markets
can affect the ability of the Group to raise funds for exploration.
The Group has identified certain risks pertinent to its business
including:
Strategic and Economic :
-- Business environment changes
-- Limited diversification
Operational :
-- Difficulty in obtaining / maintaining / renewing Licences /
approvals
Commercial :
-- Failure to maximise value from its Namibia/Zambia/Botswana
projects
-- Loss of interest in key assets
-- Regulatory compliance and legal
Human Resources and Management :
-- Failure to recruit and retain key personnel
-- Human error or deliberate negative action
-- Inadequate management processes
Financial :
-- Restrictions in capital markets impacting available financial
resources
-- Cost escalation and budget overruns
-- Fraud and corruption
The Directors regularly monitor such risks, using information
obtained or developed from external and internal sources, and will
take actions as appropriate to mitigate these. Effective risk
mitigation may be critical to the Group in achieving its strategic
objectives and protecting its assets, personnel and reputation. The
Group assesses its risk on an ongoing basis to ensure it identifies
key business risks and takes measures to mitigate these. Other
steps include regular Board review of the business, monthly
management reporting, financial operating procedures and
antibribery management systems. The Group reviews its business
risks and management systems on a regular basis
PROMOTION OF THE COMPANY FOR THE BENEFIT OF THE MEMBERS AS A
WHOLE
The Director's believe they have acted in the way most likely to
promote the success of the Company for the benefit of its members
as detailed below.
- Consider the likely consequences of any decision in the long term
- Act fairly between the members of the Company,
- Maintain a reputation for high standards of business conduct,
- Consider the interests of the Company's employees,
- Foster the Company's relationships with suppliers, customers, and others, and
- Consider the impact of the Company's operations on the community and the environment.
Our Board of Directors remain aware of their responsibilities
both within and outside of the Group. Within the limitations of a
Group with so few employees we endeavour to follow these
principles, and examples of the application of the s172 are
summarised and demonstrated below.
The Group operates as a mining exploration and development
business which is speculative in nature and at times may be
dependent upon fund-raising for its continued operation. The nature
of the business is well understood by the Company's members,
employees and suppliers, and the Directors are transparent about
the cash position and funding requirements.
The Company is investing time in developing and fostering its
relationships with its key suppliers.
As a mining exploration company with future operations based in
Scandinavia, the Board intends to take seriously its ethical
responsibilities to the communities and environment in which it
works.
The interests of future employees and consultants are a primary
consideration for the Board, and we have introduced an inclusive
share-option programme allowing them to share in the future success
of the company. Personal development opportunities are encouraged
and supported.
OUTLOOK
Outlook for Copper:
Although the price of copper has had a slight set-back in the
period post the year-end as a result of higher interest rates
implemented by western economies and also due to geopolitical
tensions. However the future price forecast for copper and other
base metals remains positive as is the forecast for the by-product
metals. The outlook for copper supply is quite bleak and we are
likely to see more smaller mines being developed since most large
mining copper projects have been shelved for political or economic
reasons. Thus, the Company is well positioned with all its
projects, to take part in an acquisition boom or alternatively be a
subject which attracts financing which might not have been
available over the last few years..
The major mining companies are seeking new projects for
acquisition and all our projects have fundamentals which could
attract the attention of larger companies. The Group has already
entered into an Option Agreement with Sandfire Resources Limited in
relation to four of its Botswanan Projects and with First Quantum
Corp. on 4 of its licences located in North Western Zambia.
The current inflationary pressures coupled with higher interest
rates may slow down the global economy and stock markets, but these
prevailing conditions are ideal for the smaller metal producer
which has historically outperformed under these economic
conditions.
The Board feels African Pioneer Plc has assembled an enviable
portfolio of projects and we are pleased that Sandfire elected to
take an equity position in the Company. We look forward to
advancing all our projects in the months ahead and providing our
shareholders with the prospects of enhanced value flowing into next
year.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Report of the
Directors and the financial statements in accordance with
applicable law and regulations.
Company law requires the directors to prepare financial
statements for each financial year. Under the law the directors
have prepared the financial statements in accordance with
International Financial Reporting Standards (IFRSs) as adopted by
the European Union. Under company law the directors must not
approve the financial statements unless they are satisfied that the
financial statements give a true and fair view of the state of
affairs and profit or loss of the Company for that period. In
preparing these financial statements, the directors are required
to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business;
-- state whether applicable IFRS's have been followed, subject
to any material departures disclosed and explained in the financial
statements.
The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements comply with the Companies Act 2006 and
Article 4 of the IAS Regulation. They are also responsible for
safeguarding the assets of the Company and hence for taking
reasonable steps for the prevention and detection of fraud and
other irregularities.
The directors confirm that:
-- so far as each director is aware, there is no relevant audit
information of which the Company's auditor is unaware; and
-- the directors have taken all the steps that they ought to
have taken as directors in order to make themselves aware of any
relevant audit information and establish that the auditors are
aware of that information.
Legislation in the Isle of Man governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
Signed on behalf of the Board:
30 June 2022
Colin Bird
Non-Executive Chairman
Independent Auditor's Report TO THE MEMBERS OF AFRICAN PIONEER
PLC FOR THE YEARED 31 DECEMBER 2021
Opinion
We have audited the financial statements of African Pioneer Plc
(the 'parent company') and its subsidiaries (the 'group') for the
year ended 31 December 2021 which comprise the consolidated
statement of comprehensive income, the consolidated statement of
changes in equity, the company statement of changes in equity, the
consolidated statement of financial position, the company statement
of financial position, the consolidated statement of cash flows,
the company statement of cash flows and the related notes 1 to 17,
including a summary of significant accounting policies. The
financial reporting framework that has been applied in their
preparation is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the EU.
In our opinion, the financial statements:
-- give a true and fair view of the state of the group's and of
the parent company's affairs as at 31 December 2021 and of the
group's result for the year then ended;
-- have been properly prepared in accordance with IFRSs.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the company
in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC's Ethical Standard, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe
that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
Director's use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
entity's ability to continue as a going concern for a period of at
least twelve months from when the financial statements are
authorized for issue.
Our responsibilities and the responsibilities of the Directors
with respect to going concern are described in the relevant
sections of this report.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key audit matters Description of the How the scope of
risk our audit addressed
the risk
Revenue recognition There is a risk of Our work examined
fraud in revenue recognition sources of income
giving rise to material and no evidence of
misstatements in the fraud or other understatement
accounts. in revenue was identified.
------------------------------- -------------------------------
Risk that management Risk that inappropriate We examined journals
is able to override accounting journals posted around the
controls may be posted giving year end, specifically
rise to material misstatement focusing on areas,
in the accounts. which are more easily
manipulated.
We identified no evidence
of management override
in respect of inappropriate
manual journals recorded
in any section of
the financial statements.
------------------------------- -------------------------------
IFRS6 Mining and Exploration Risk that mining exploration Our work examined
rights and licensing costs licenses and other
are inappropriately capitalised expenditure
capitalised with respect to ensure it fell
to the criteria set within the capitalisation
out in IFRS 6. criteria under IFRS6
and no evidence of
impairment was identified.
------------------------------- -------------------------------
Public Limited Company By virtue of the Company's The listing regulations
listing status listing status and were reviewed and
its public profile, all filings required
the Company has enhanced of the Company were
regulatory supervision seen to have been
and therefore any correctly made on
non-compliance with time. No instance
such regulations could of non-compliance
affect the entities was identified.
ability to trade and
therefore its going
concern status
------------------------------- -------------------------------
Overseas group entities Risk that as the group The finance function
has overseas entities and controls are all
that the accounting centralized from the
records may not be UK, no evidence of
easily obtainable. issues with overseas
entities identified.
------------------------------- -------------------------------
Our application of materiality
In planning and performing our audit we applied the concept of
materiality. An item is considered material if it could reasonably
be expected to change the economic decisions of a user of the
financial statements. We used the concept of materiality to both
focus our testing and evaluate the impact of misstatements
identified.
Based on our professional judgement, we determined overall
materiality for the Group's financial statements as a whole to be
GBP85,392. In determining this, we considered a range of benchmarks
with specific focus on the net assets at the balance sheet date.
This materiality level represents 1.4% of net assets.
Based on our professional judgement, we determined overall
materiality for the Parent Company's financial statements as a
whole to be GBP85,392. In determining this, we considered a range
of benchmarks with specific focus on the net assets at the balance
sheet date. This materiality level represents 1.6% of net
assets.
We report to the Audit Committee all identified unadjusted
errors in excess of GBP4,270. Errors below that threshold would
also be reported if, in our opinion as auditor, disclosure was
required on qualitative grounds.
An overview of the scope of our audit
Our audit was scoped by obtaining an understanding of the
Company and its environment, including controls, and assessing the
risks of material misstatement.
Other information
The other information comprises the information included in the
annual report, other than the financial statements and our
auditor's report thereon. The directors are responsible for the
other information. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon. In connection with our audit of the
financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other
information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required
to determine whether there is a material misstatement in the
financial statements or a material misstatement of the other
information. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we
are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the directors' report for the
financial year for which the financial statements are prepared is
consistent with the financial statements; and
-- the directors' report has been prepared in accordance with applicable legal requirements.
Matters on which we report by exception
In the light of the knowledge and understanding of the company
and its environment obtained in the course of the audit, we have
not identified material misstatements in the directors' report. We
have nothing to report in respect of the following matters if, in
our opinion:
-- adequate accounting records have not been kept, or returns
adequate for our audit have not been received from branches not
visited by us; or
-- the financial statements are not in agreement with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit; or
-- the directors were not entitled to prepare the financial
statements in accordance with the small companies regime and take
advantage of the small companies' exemptions in preparing the
directors' report and from the requirement to prepare a strategic
report.
Responsibilities of directors
As explained more fully in the directors' responsibilities
statement set out on page 11, the directors are responsible for the
preparation of the financial statements and for being satisfied
that they give a true and fair view, and for such internal control
as the directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement,
whether due to fraud or error. In preparing the financial
statements, the directors are responsible for assessing the
company's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to
liquidate the company or to cease operations, or have no realistic
alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below:
We identify and assess the risks of material misstatement
contained within the financial statements, whether due to fraud or
error, and then design and perform audit procedures responsive to
those risks, including obtaining audit evidence that is sufficient
and appropriate to provide a basis for our opinion.
Identifying and assessing potential risks related to
irregularities
In identifying and assessing risks of material misstatement in
respect of irregularities, including fraud and non-compliance with
laws and regulations, we considered the following:
-- the nature of the industry and sector, control environment and business performance;
-- results of our enquiries of management about their own
identification and assessment of the risks of irregularities;
-- any matters we identified having obtained and reviewed the
Company's documentation of their policies and procedures relating
to:
-- identifying, evaluating and complying with laws and
regulations and whether they were aware of any instances of
noncompliance;
-- detecting and responding to the risks of fraud and whether
they have knowledge of any actual, suspected or alleged fraud;
-- the internal controls established to mitigate risks of fraud
or non-compliance with laws and regulations;
-- the matters discussed among the audit engagement team
regarding how and where fraud might occur in the financial
statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities
and incentives that may exist within the organisation for fraud. In
common with all audits under ISAs (UK), we are also required to
perform specific procedures to respond to the risk of management
override.
We also obtained an understanding of the legal and regulatory
frameworks that the Company operates in, focusing on provisions of
those laws and regulations that had a direct effect on the
determination of material amounts and disclosures in the financial
statements. The key laws and regulations we considered in this
context included the Isle of Man Companies Act and local tax
legislation.
Audit response to risks identified
As a result of performing the above, our procedures to respond
to risks identified included the following:
-- reviewing the financial statement disclosures and testing to
supporting documentation to assess compliance with provisions of
relevant laws and regulations described as having a direct effect
on the financial statements;
-- enquiring of management concerning actual and potential litigation and claims;
-- performing analytical procedures to identify any unusual or
unexpected relationships that may indicate risks of material
misstatement due to fraud;
-- reading minutes of meetings of those charged with governance;
-- obtained an understanding of provisions and held discussions
with management to understand the basis of recognition or
non-recognition of tax provisions; and
-- in addressing the risk of fraud through management override
of controls, testing the appropriateness of journal entries and
other adjustments; assessing whether the judgements made in making
accounting estimates are indicative of a potential bias; and
evaluating the business rationale of any significant transactions
that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations
and potential fraud risks to all engagement team members including
internal specialists and significant component audit teams and
remained alert to any indications of fraud or noncompliance with
laws and regulations throughout the audit.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at:
https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx
This description forms part of our auditor's report.
Use of our report
This report is made solely to the company's members, as a body.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state in an
auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company's members, as a body,
for our audit work, for this report, or for the opinion we have
formed.
Robert Wood (Senior Statutory Auditor)
For and on behalf of
Shipleys LLP
Chartered Accountants & statutory auditor
10 Orange Street
Haymarket
London
WC2H 7DQ
Date: 30 June 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2021
Notes Year ended Year ended
31 December 31 December
2021 2020
GBP GBP
CONTINUING OPERATIONS
Income:
Option fees received re licenses 668,599 -
Interest receivable - -
Dividend receivable 691 341
Realised (loss) on sale of investments - (81,707)
Unrealised gain on investments 100,391 138,231
Total Income
Administrative expenses 769,681 56,865
Administrative expenses 4 (291,690) (37,894)
Listing related costs (79,925) (63,045)
Mining licenses and rights - (41,323)
Total Administrative Expense (371,615) (142,262)
------------------------------------------- ------ -------------------- --------------------------
OPERATING PROFIT/(LOSS) FOR THE YEAR 398,066 (85,397)
Interest expense (2,373) (4,760)
Interest income - 1
PROFIT/(LOSS) BEFORE TAX 395,693 (90,156)
Taxation 7 - -
------------------------------------------- ------ -------------------- --------------------------
NET PROFIT/(LOSS) FOR THE YEAR 395,693 (90,156)
------------------------------------------- ------ -------------------- --------------------------
Other comprehensive income:
Other comprehensive income - -
Profit/(Loss) for the financial year
Items that may be reclassified to
profit or loss:
Foreign currency reserve movement 34,339 -
Total comprehensive profit/(loss)
for the financial year 430,032 (90,156)
------------------------------------------- ------ -------------------- --------------------------
Attributable to:
Owners of the Company 430,031 (90,156)
Non-controlling interest - -
--------------------------
430,031 (90,156)
-------------------- --------------------------
Basic loss per share 6 0.34 p (0.77) p
------------------------------------------- ------ -------------------- --------------------------
Diluted loss per share 6 0.29 p (0.77) p
------------------------------------------- ------ -------------------- --------------------------
All results are derived from continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
Notes 31 December 2021 31 December
2020
GBP GBP
NON-CURRENT ASSETS
Available-for-sale investments 8 502,456 99,105
Exploration and evaluation assets 10 4,432,962 -
Total Non-Current Assets 4,935,418 99,105
CURRENT ASSETS
Trade and other receivables 11 21,722 420
Cash and cash equivalents 1,190,979 87,462
Total Current Assets 1,212,701 87,882
TOTAL ASSETS 6,148,119 186,987
CURRENT LIABILITIES
Trade and other payables 12 (83,949) (50,730)
Total Current Liabilities (83,949) (50,730)
NET CURRENT ASSETS / (LIABILITIES) 1,128,752 37,152
------------------------------------ ------------ ----------------- ------------
NON-CURRENT LIABILITIES
Loans 13(i) - (49,143)
Total Non-Current Liabilities - (49,143)
TOTAL LIABILITIES (83,949) (99,873)
------------------------------------ ------------ ----------------- ------------
NET ASSETS 6,064,170 87,114
------------------------------------ ------------ ----------------- ------------
EQUITY
Share capital 14 5,490,271 452,983
Capital contribution (13)(i)(ii) - 186,446
Warrant reserve 15 8,834 -
Foreign exchange reserve 34,339 -
Retained earnings (156,622) (552,315)
------------
5,376,822 87,114
------------------------------------ ------------ ----------------- ------------
Non controlling interest 687,348 -
------------------------------------ ------------ ----------------- ------------
TOTAL EQUITY 6,064,170 87,114
------------------------------------ ------------ ----------------- ------------
The notes on pages 45-67 are an integral part of these financial
statements.
The financial statements of African Pioneer Plc (registered
number 008591V) were approved by the board on 30 June 2022 and
signed on its behalf by:
C Bird R Samtani
Non-Executive Chairman Director
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Share capital Capital Retained Foreign Warrant Non Total equity
contribution earnings exchange reserve Controlling
reserve interest
GBP GBP GBP GBP GBP GBP GBP
As at 1 January
2020 452,983 61,446 (462,159) - - - 52,270
Convertible loan
notes issued - 125,000 - - - - 125,000
(Loss) for the
year - - (90,156) - - - (90,156)
As at 31 December
2020 452,983 186,446 (552,315) - - - 87,114
------------------- -------------- -------------- ---------- ---------- --------- ------------- -------------
As at 1 January 2021 452,983 186,446 (552,315) - - - 87,114
----------------------------- ---------- ---------- ---------- ------- ------ -------- ----------
Net proceeds from
shares issued 2,030,877 - - - - - 2,030,877
Acquisition of subsidiaries 2,962,500 - - - - - 2,962,500
Acquisition of additional
15% of Manmar subsidiaries 52,745 - - - 52,745
Loan notes converted
into shares - (186,446) - - - - (186,446)
Profit for the year - - 395,693 34,339 430,032
Share based payment
charge (8,834) - - - 8,834 - -
Non-controlling interests
on acquisition of
subsidiary - - - - - 687,348 687,348
----------------------------- ---------- ---------- ---------- ------- ------ -------- ----------
As at 31 December
2021 5,490,271 - (156,622) 34,339 8,834 687,348 6,064,170
----------------------------- ---------- ---------- ---------- ------- ------ -------- ----------
The notes on pages 45-67 are an integral part of these financial
statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
Notes Year ended Year ended
31 December 31 December
2021 2020
GBP GBP
CASH FLOW FROM OPERATIONS
Profit/(Loss) before taxation 395,693 (90,156)
Adjustments for:
Interest received - (1)
Dividends received (691) (341)
Loss on disposal - 81,707
Unrealised gain on investments 8 (100,391) (138,231)
Interest expense - 4,760
Operating (loss) before movements in
working capital 294,611 (142,262)
Increase in receivables (21,302) -
Increase in payables 33,219 38,918
NET CASH OUTFLOW FROM OPERATING ACTIVITIES 306,528 (103,344)
--------------------------------------------- ------ ------------- -------------
TAXATION PAID
CASH FLOW FROM INVESTING ACTIVITIES
Interest received - 1
Dividends received 691 341
Investments purchased (302,960) -
Investments sold - 63,888
Purchases of Exploration and evaluation
assets (303,206) -
Purchase of Exploration and Evaluation
assets on Acquisition of subsidiaries (427,163) -
-------------
NET CASH INFLOW FROM INVESTING ACTIVITIES (1,032,638) 64,230
--------------------------------------------- ------ ------------- -------------
CASH FLOW FROM FINANCING ACTIVITIES
Issue of convertible loan notes - 125,000
Proceeds from Issue of shares, net of
issue costs 1,844,431 -
Loan repayment (49,143) -
NET CASH INFLOW FROM FINANCING ACTIVITIES 1,795,288 125,000
--------------------------------------------- ------ ------------- -------------
Net increase/(decrease) in cash and
cash equivalents in the period 1,069,178 85,886
Effect of foreign exchange rate changes 34,339 -
Cash and cash equivalents at the beginning
of the period 87,462 1,576
--------------------------------------------- ------ ------------- -------------
Cash and cash equivalents at the end
of the period 1,190,979 87,462
--------------------------------------------- ------ ------------- -------------
The notes on pages 45-67 are an integral part of these financial
statements.
COMPANY STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
Notes 31 December 2021 31 December
2020
GBP GBP
NON-CURRENT ASSETS
Available-for-sale investments 8 502,456 99,105
Investment in subsidiaries 10 2,796,500 -
Total Non-Current Assets 3,298,956 99,105
CURRENT ASSETS
Trade and other receivables 11 898,541 420
Cash and cash equivalents 1,190,969 87,462
Total Current Assets 2,089,510 87,882
TOTAL ASSETS 5,388,466 186,987
CURRENT LIABILITIES
Trade and other payables 12 (42,472) (50,730)
Total Current Liabilities (42,472) (50,730)
NET CURRENT ASSETS /
(LIABILITIES) 2,047,038 37,152
-------------------------------- ---------- ----------------- ------------
NON-CURRENT LIABILITIES
Loans 13(i) - (49,143)
Total Non-Current Liabilities - (49,143)
TOTAL LIABILITIES (42,472) (99,873)
-------------------------------- ---------- ----------------- ------------
NET ASSETS 5,345,994 87,114
-------------------------------- ---------- ----------------- ------------
EQUITY
Share capital 14 5,490,271 452,983
Capital contribution 13(i)(ii) - 186,446
Warrant reserve 15 8,834 -
Retained earnings (153,111) (552,315)
----------------- ------------
TOTAL EQUITY 5,345,994 87,114
----------------- ------------
The notes on pages 45-67 are an integral part of these financial
statements.
The financial statements of African Pioneer Plc (registered
number 008591V) were approved by the board on 30 June 2022 and
signed on its behalf by:
C Bird R Samtani
Non-Executive Chairman Director
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Share capital Capital Retained Warrant Total equity
contribution earnings reserve
GBP GBP GBP GBP GBP
As at 1 January
2020 452,983 61,446 (462,159) - 52,270
Convertible loan
notes issued - 125,000 - - 125,000
(Loss) for the year - - (90,156) - (90,156)
As at 31 December
2020 452,983 186,446 (552,315) - 87,114
--------------------- -------------- -------------- ---------- --------- -------------
As at 1 January 2021 452,983 186,446 (552,315) - 87,114
----------------------------- ---------- ---------- ---------- ------ ----------
Net proceeds from shares
issued 2,030,877 - - - 2,030,877
Acquisition of subsidiaries 2,962,500 - - - 2,962,500
Acquisition of additional
15% of Manmar subsidiaries 52,745 - - - 52,745
Loan notes converted
into shares - (186,446) - - (186,446)
Share based payment
charge (8,834) - - 8,834 -
Profit for the year - - 399,204 399,204
As at 31 December 2021 5,490,271 - (153,111) 8,834 5,345,994
----------------------------- ---------- ---------- ---------- ------ ----------
The notes on pages 45-67 are an integral part of these financial
statements.
COMPANY STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
Notes Year ended Year ended
31 December 31 December
2021 2020
GBP GBP
CASH FLOW FROM OPERATIONS
Profit/(Loss) before taxation 399,204 (90,156)
Adjustments for:
Interest received - (1)
Dividends received (691) (341)
Loss on disposal - 81,707
Unrealised (gain)/loss on investments 8 (100,391) (138,231)
Interest expense - 4,760
Operating (loss) before movements
in working capital 298,122 (142,262)
Increase in receivables (20,559) -
Increase in payables (8,258) 38,918
Increase in loans to subsidiaries (230,173)
------------------------------------------- ------ ------------- -------------
NET CASH OUTFLOW FROM OPERATING
ACTIVITIES 39,132 (103,344)
------------------------------------------- ------ ------------- -------------
TAXATION PAID
CASH FLOW FROM INVESTING ACTIVITIES
Interest received - 1
Dividends received 691 341
Investments purchased 8 (302,960) -
Investments sold - 63,888
Acquisition of subsidiaries (428,644) -
- -
NET CASH INFLOW FROM INVESTING ACTIVITIES (730,913) 64,230
------------------------------------------- ------ ------------- -------------
CASH FLOW FROM FINANCING ACTIVITIES
Issue of convertible loan notes - 125,000
Proceeds from Issue of shares, net
of issue costs 1,844,431 -
Loan repayment (49,143) -
NET CASH INFLOW FROM FINANCING ACTIVITIES 1,795,288 125,000
------------------------------------------- ------ ------------- -------------
Net increase/(decrease) in cash
and cash equivalents in the period 1,103,507 85,886
Cash and cash equivalents at the
beginning of the period 87,462 1,576
------------------------------------------- ------ ------------- -------------
Cash and cash equivalents at the
end of the period 1,190,969 87,462
------------------------------------------- ------ ------------- -------------
The notes on pages 45-67 are an integral part of these financial
statements.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2021
1. GENERAL INFORMATION
This financial information is for African Pioneer Plc ("the
Company") and its subsidiary undertakings. The principal activity
of African Pioneer Plc (the 'Company') and its subsidiaries
(together the 'Group') is the development of natural resources
exploration projects in Sub-Saharan Africa.
The Company is a public limited company and was listed on to the
Official List (Standard Segment) and commenced trading on the Main
Market for listed securities of the London Stock Exchange on 1 June
2021. The Company is domiciled in the Isle of Man and was
incorporated on 20th July 2012 under the Isle of Man Companies Act
2006 with company registration number 00859IV, and with registered
address being 34 North Quay, Douglas, Isle of Man, IM1 4LB.
2. ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared under the historical
cost convention except for the measurement of certain non-current
asset investments at fair value. The measurement basis and
principal accounting policies of the Group are set out below. The
financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) issued by the
International Accounting Standards Board (IASB) and endorsed by the
European Union.
New and amended IFRS Standards that are effective for the
current year
A number of new standards and interpretations have been adopted
by the Group for the first time in line with their mandatory
adoption dates, but none are applicable to the Group and hence
there would be no impact on the financial statements.
New and revised IFRS Standards in issue but not yet
effective
At the date of approval of these financial statements, the Group
has not applied the following new and revised IFRS Standards that
have been issued but are not yet effective:
IFRS 17 (including Insurance Contracts
the June 2020 amendments
to IFRS 17)
IFRS 10 and IAS Sale or Contribution of Assets between an Investor
28 (amendments) and its Associate or Joint
Venture
--------------------------------------------------------
Amendments to IFRS Interest rate benchmark
9, IAS 39, IFRS
7, IFRS 4 and IFRS
16
--------------------------------------------------------
Amendment to IFRS Covid rent concessions
16
--------------------------------------------------------
IFRS 3 Conceptual framework
--------------------------------------------------------
Amendments to IAS Classification of Liabilities as Current or Non-current
1
--------------------------------------------------------
Amendments to IFRS Reference to the Conceptual Framework
3
--------------------------------------------------------
Amendments to IAS Property, Plant and Equipment-Proceeds before Intended
16 Use
--------------------------------------------------------
Amendments to IAS Onerous Contracts - Cost of Fulfilling a Contract
37
--------------------------------------------------------
Amendments to IAS Disclosure of Accounting Policies
1 and IFRS
Practice Statement
2
--------------------------------------------------------
Amendments to IAS Definition of Accounting Estimates
8
--------------------------------------------------------
Amendments to IAS Deferred Tax related to Assets and Liabilities
12 arising from a Single Transaction
--------------------------------------------------------
Amendments to IAS Agriculture
41
--------------------------------------------------------
The directors do not expect that the adoption of the Standards
listed above will have a material impact on the financial
statements of the Company in future periods.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
(its subsidiaries). Control is achieved where the Company has power
over the investee, is exposed or has rights to variable returns
from its involvement with the investee and has the ability to use
its power to affect its returns.
The results of subsidiaries acquired or disposed of are included
in the consolidated Statement of Comprehensive Income from the
effective date of acquisition or up to the effective date of
disposal, as appropriate.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used in
line with those used by other members of the Group.
All intragroup assets and liabilities, equity, income, expenses,
and cash flows relating to transactions between members of the
Group are eliminated in full on consolidation.
Profits/(losses) attributable to non-controlling interests are
shown separately in the Statement of Comprehensive income and the
portion of net assets attributable to non-controlling interest is
shown on the Statement of Financial Position.
Going concern
The Group made a profit from all operations for the year ended
31 December 2021 after tax of GBP396,000 (2020: loss of GBP90,000),
On 2 October 2021 the Company entered into a two-year option
agreement with ASX listed Sandfire Resources Limited in relation to
4 of its 8 Botswana prospecting licences whereby the Company
received a cash payment amounting to US$500,000 plus 107,272
Sandfire Resources Limited shares as part of the agreement with
Sandfire. As a result of the option fee received, the Company made
a profit during the year. During the period, the Company raised
GBP1,750,000 at the time of its Listing on 1 June 2021and
GBP365,000 by way of a share subscription from Sandfire Resources
Limited. Cash and cash equivalents were GBP1.19 million as at 31
December 2021, which will enable the Company to carry out its
planned exploration activities on its newly acquired projects. An
operating loss is expected in the year subsequent to the date of
these accounts and as a result the Company will need to raise
funding to provide additional working capital to finance its
ongoing activities. The management team has successfully raised
funding for exploration projects in the past, but there is no
guarantee that adequate funds will be available when needed in the
future.
Based on its current reserves and the Board's assessment that
the Company will be able to raise additional funds, as and when
required, to meet its working capital and capital expenditure
requirements, the Board have concluded that they have a reasonable
expectation that the Group can continue in operational existence
for the foreseeable future. For these reasons the financial
statements have been prepared on the going concern basis, which
contemplates continuity of normal business activities and the
realisation of assets and discharge of liabilities in the normal
course of business.
Exploration assets accounting policy
The Company's exploration assets accounting policy is in line
with IFRS6. Exploration, evaluation and development expenditure
incurred is accumulated in respect of each identifiable area of
interest. These costs are only carried forward to the extent that
they are expected to be recouped through the successful development
of the area or where activities in the area have not yet reached a
stage which permits reasonable assessment of the existence of
economically recoverable reserves. Accumulated costs in relation to
an abandoned area are written off in full in the year in which the
decision to abandon the area is made. When production commences,
the accumulated costs for the relevant area of interest are
transferred to development assets and amortised over the life of
the area according to the rate of depletion of the economically
recoverable reserves. A regular review is undertaken of each area
of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Valuation of investments
The company has adopted the provisions of IFRS9 and has elected
to treat all available for sale investments at fair value with
changes through the profit and loss.
Available-for-sale investments under IFRS9 are initially
measured at fair value plus incidental acquisition costs.
Subsequently, they are measured at fair value in accordance with
IFRS 13. This is either the bid price or the last traded price,
depending on the convention of the exchange on which the investment
is quoted. All gains and losses are taken to profit and loss.
Equity and reserves
An equity instrument is any contract that evidences a residual
interest in the assets of a company after deducting all of its
liabilities. Equity instruments issued are recorded at the proceeds
received net of direct issue costs.
Share capital represents the amount subscribed for shares with
no par nominal value.
Any transaction costs associated with the issuing of shares are
deducted from share capital, net of any related income tax
benefits.
Foreign exchange reserve - amounts arising on re-translating the
net assets of overseas operations into the presentational
currency
The capital contribution reserve represents the value of the
equity component of loans made from parent undertakings.
The warrant reserve presents the proceeds from issuance of
warrants, net of issue costs. Warrant reserve is non-distributable
and will be transferred to share capital account and accumulated
losses upon exercise of warrants. Shares to be issued reserve
arises on the timing difference between the Company making a
commitment to issue shares and the shares being issued. Once the
shares are issued a transfer is made to the share capital account.
Accumulated losses include all current and prior period results as
disclosed in the statement of comprehensive income, less dividends
paid to the owners of the parent.
Significant management judgement in applying accounting policies
and estimation uncertainty
When preparing the financial statements, management makes a
number of judgements, estimates and assumptions about the
recognition and measurement of assets, liabilities, income and
expenses.
Functional and presentational currency
The presentation and functional currency of the Company is
Sterling.
Expenses
All expenses are accounted for on an accruals basis. Expenses
are charged to the statement of comprehensive income except for
expenses incurred on the acquisition of an investment, which are
included within the cost of that investment, expenses arising on
the disposal of investments are deducted from the disposal
proceeds.
Cash and cash equivalents
This consists of cash held in the Company's bank account.
Financial liabilities
The Company has financial liabilities consisting of trade
payables and accrued expenses which are non-derivative financial
liabilities recognised at amortised cost.
Taxation
The Company is subject to taxation in the Isle of Man in the
period at a rate of 0% and accordingly, interest and gains payable
to the Company are received by the Company without any deduction
relating to Isle of Man taxed.
Earnings per share
The earnings per share are calculated by dividing the net result
attributed to the equity shareholders by the weighted average
number of participating shares in issue in the period.
Geographical segments
A segment is a distinguishable component of the Company that is
engaged either in providing products or services (business segment)
or in providing products or services within a particular economic
environment (geographical segment), which is subject to risk and
rewards that are different from those of other segments. The
internal management reporting used by the chief operating decision
maker consists of one segment. Hence in the opinion of the
directors, no separate disclosures are required under IFRS 8. The
Company's revenue in the year is not material and consequently no
geographical segment information has been disclosed.
Critical accounting estimates and judgements
The preparation of the Group's financial statements under IFRS
requires the Directors to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities. Estimates and
judgements are continually evaluated and are based on historical
experience and other factors including expectations of future
events that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates.
Details of the Group's significant accounting judgements used in
the preparation of these financial statements include:
Recoverability of intangible exploration and evaluation
assets
Where a project is sufficiently advanced, the recoverability of
intangible exploration and evaluation assets is assessed by
comparing the carrying value to internal and operator estimates of
the net present value of projects. Intangible exploration assets
are inherently judgemental to value. The amounts for intangible
exploration and evaluation assets represent active exploration
projects. These amounts will be written-off to the profit and loss
as exploration costs unless commercial reserves are established, or
the determination process is completed and there are no indications
of impairment. The carrying value of exploration assets in the
consolidated financial statements as at 31 December 2021 is
GBP4,432,962. The recoverability of this carrying value, and thus
potential impairment, requires use of significant judgments and
estimates. The details of these assets are outlined in note 10.
Recoverability of investment in subsidiaries and intragroup
receivables
In the Company financial statements, the carrying value of the
Company's investment in subsidiaries and intragroup receivables is
GBP3,674,062. The recoverability of this balance is driven by the
same judgements and uncertainties as the recoverability of the
exploration and evaluation assets held by the subsidiaries.
Valuation of share-based payments
Equity-settled share-based payment transactions with parties
other than employees are measured at the fair value of the goods or
services received, except where that fair value cannot be estimated
reliably, in which case they are measured at the fair value of the
equity instruments granted, measured at the date the entity obtains
the goods or the counterparty renders the service. The share-based
payment expense is recognised as deduction in share capital. A
corresponding increase in the warrant reserve is also recognised
The fair value of these payments is calculated by the Company using
the Black Scholes option pricing model. The model requires the
Directors to make assumptions regarding the share price volatility,
risk free rate and expected life of awards in order to determine
the fair values of the awards at grant dates.
3. FINANCIAL RISK MANAGEMENT
The Company's objective is to achieve capital growth through
investing in selection of equity and other instruments. The
Company's financial instruments comprise:
-- Available-for-sale investments
-- Cash, short-term receivables and payables
Throughout the period under review, it was the Company's policy
that no trading in derivatives shall be undertaken. The main
financial risks arising from the Company's financial instruments
are market price risk and liquidity risk. The Board regularly
reviews and agrees policies for managing each of these risks and
they are summarised below. These policies have remained constant
throughout the period.
Market risk
Market risk consists of interest rate risk, foreign currency
risk and other price risk. There are no foreign currency exposures.
Hence, no foreign currency risk. It is the Board's policy to
maintain an appropriate spread of investments in the portfolio
whilst maintaining the investment policy and aims of the Company.
The Investment Committee actively monitors market prices and other
relevant information throughout the year and reports to the Board,
who is ultimately responsible for the Company's investment
policy.
Interest rate risk
Changes in interest rates would affect the Company returns from
its cash balances. A floating rate of interest, which is linked to
bank base rates, is earned on cash deposits. The exposure to cash
flow interest rate risk at 31 December 2021 for the Company was GBP
1,190,969 (2020: GBP87,462). As the Company does not have any
borrowings and finances its operations through its share capital
and retained revenues, it does not have any interest rate risk
except in relation to cash balances.
Other price risk
Other price risk which comprises changes in market prices other
than those arising from interest rate risk or currency risk may
affect the value of quoted and unquoted equity investments. The
Board of directors manages the market price risks inherent in the
investment portfolio by regularly monitoring price movements and
other relevant market information. The Company accounts for
movements in the fair value of its available-for-sale financial
assets in other comprehensive income. A 5% change in prices of
investments would result in increase/(decrease) of GBP25,123 in
value of investments (2020: GBP4,955).
Liquidity risk
The Company maintains appropriate cash reserves and the majority
of the Company's assets comprise of realisable securities, most of
which can be sold to meet funding requirements, if necessary. Given
the Company's cash reserves, it has been able to settle all
liabilities on average within 1 month. Given the current level of
cash resources the liquidity risk is not considered to be
material.
Credit risk
Credit risk is the risk of financial loss to the Company if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations.
The carrying amount of financial assets represents the maximum
credit exposure. The maximum exposure to credit risk as at 31
December 2021 is detailed below:
For the Group, credit risk arises primarily from cash balances
held at banks. The risk is mitigated by using only reputable
financial institutions with a high credit rating.
The Company is additionally exposed to credit risk on the
intercompany balances with its subsidiaries. The recoverability of
these balances is linked directly to the success of the exploration
activities of the Group.
As discussed in note 10, no impairment indicators exist on the
exploration assets and thus the balances are deemed to be
recoverable. The Company and Group do not hold any collateral as
security
The credit rating bands are provided by independent ratings
agencies:
As at 31 December 2021 Not rated Total
/not readily
available
Cash and cash equivalents 1,190,969 1,190,969
Total assets subject to
credit risk 1,190,969 1,190,969
-------------- ----------
As at 31 December 2020 Not rated Total
/not readily
available
Cash and cash equivalents 87,462 87,462
Total assets subject to
credit risk 87,462 87,462
-------------- -------
Financial liabilities
There are no currency or interest rate risk exposures on
financial liabilities as they are denominated in GBP Sterling.
Capital management
The Company actively reviews its issued share capital and
reserves and manages its capital requirements in order to maintain
an efficient overall financing structure whilst avoiding any
leverage.
4. EXPENSES BY NATURE
31 December 31 December 2020
2021
Directors' fees 5 (100,469) (3,600)
Audit fees (32,220) (9,999)
Stock exchange related costs (14,813) -
Legal, professional and consultancy
fees (64,359) (7,537)
Management services (11,800) (10,800)
Insurance (14,521) -
Other administration expenses (19,321) (5,958)
Investor relations (34,187) -
------------------------------------------------------ --- ---------------- -------------------
Total Expense (291,690) (37,894)
------------------------------------------------------ --- ---------------- -------------------
31 December 31 December 2020
2021
GBP GBP
Auditor's remuneration
* Audit of the financial statements of the Company 32,220 9,999
--------------- -------------------
5. DIRECTORS' EMOLUMENTS
Other than directors, there were no employees or key management
personnel in the year.
31 December 31 December
2021 2020
GBP GBP
Colin Bird 35,000 -
Raju Samtani 29,169 -
Christian Cordier 16,500 -
Kjeld Thygesen 16,500 -
James Cunningham-Davis 9,300 3,600
------------ ------------
Total 106,469 3,600
------------ ------------
The emoluments paid to the directors relate to both the Company
and the Group
Colin Bird and Raju Samtani did not receive any remuneration in
the year ended 31 December 2020.
2021 2020
Number Number
------- -------
Directors 4 3
------- -------
Consultants 1 -
------- -------
The average monthly number of employees 5 3
------- -------
6. EARNINGS PER SHARE
31 December 2021 31 December 2020
Profit/(Loss) after tax for the 395,692 GBP (90,156)
purposes of earnings per share attributable
to equity shareholders
Weighted average number of shares 116,222,201 11,729,826
Weighted average number of shares
and warrants 138,235,532 11,729,826
Basic profit/(loss) per ordinary
share 0.34 p (0.77) p
Diluted profit per ordinary share 0.29 p (0.77) p
The use of the weighted average number of shares in issue in the
period recognises the variations in the number of shares throughout
the period and is in accordance with IAS 33. During the year, the
company consolidated 10 existing shares to 1 (note 14).
7. TAXATION
The Company is subject to Isle of Man income tax at 0%, has
suffered no taxation in other jurisdictions, and has no capital
allowances or deferred tax implications. Accordingly, the Directors
have made no provision for taxation charges or liabilities and have
not presented the formal reconciliation required under IAS 12.
8. AVAILABLE FOR SALE INVESTMENTS
Group & Company Group & Company
31 December 2021 31 December 2020
GBP GBP
Investments at fair value at
1 January 99,105 106,469
Additions 302,960 -
Disposals - (63,888)
Movements in fair value 100,391 56,524
Investments at fair value at
31 December 502,456 99,105
----------------- -----------------
The book cost of the investments at 31 December 2021 was
GBP410,050 (2020: GBP107,090).
The Company's intention following its Listing is not to purchase
any new investments and to hold its residual portfolio as
realisable investments as a source of liquidity to cover
explorations costs and general overheads of the Company.
Financial instruments measured at fair value
The following table presents financial assets and liabilities
measured at fair value in the statement of financial position in
accordance with the fair value hierarchy. This hierarchy groups
financial assets and liabilities into three levels based on the
significance of inputs used in measuring the fair value of the
financial assets and liabilities. The fair value hierarchy has the
following levels:
- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
- Level 2: inputs other than quoted prices included within Level
1 that are observable for the asset or liability, either directly
(i.e., as prices) or indirectly (i.e., derived from prices);
and
- Level 3: inputs for the asset or liability that are not based
on observable market data (unobserved inputs).
The level within which the financial asset or liability is
classified is determined based on the lowest level of significant
input to the fair value measurement.
The financial assets and liabilities measured at fair value in
the statement of financial position are grouped into the fair value
hierarchy as follows:
Level 1 Level 2 Level 3 Total
31 December 2021 GBP GBP GBP GBP
Assets 502,456 - 502,456
Total 502,456 - 502,456
Level 1 Level 2 Level 3 Total
GBP GBP GBP GBP
31 December 2020
Assets
Investments held at fair
value 99,105 - - 99,105
-------- -------- -------- -----------------------
Total 99,105 - - 99,105
9. ACQUISITION OF SUBSIDIARIES
Acquisition of Zamcu Exploration Pty Limited (Namibian Projects)
On 1 June 2021 the Company completed the acquisition of 100% of Zamcu
Exploration Pty Ltd ("Zamcu"), which via its subsidiaries, held a 70
per cent. interest in two Namibian Exclusive Prospecting Licenses ("EPLs")
comprising the Ongombo and Ongeama projects, located within the Matchless
amphibolite Belt of central Namibia that hosts copper-gold mineralisation.
On 27 August 2021 the Company entered into an agreement to acquire
a further 15% interest in its Ongombo Project and Ongeama Project in
Namibian (the "Namibian Projects") increasing its interest in the Namibian
Projects to 85% (see note 10)
The fair value of the assets and liabilities acquired were as follows:
GBP
Consideration
Equity consideration
* Ordinary shares (issued) 687,500
Cash consideration 149,149
------------
836,649
Fair value of assets and liabilities
acquired
-
* Assets
* Liabilities (262)
------------
(262)
Deemed fair value of
exploration assets acquired 836,911
Additional 15% acquired 331,240
------------
Total 85% acquisition value 1,168,151
Attributable to non-controlling
interest 206,098
Gross fair value of exploration
assets acquired 1,374,249
------------
Acquisition of African Pioneer Zambia Limited ("APZ") (Zambia Projects)
On 1 June 2021 the Company completed the acquisition of 80% of APZ,
which holds a 100 per cent. interest in five Zambian Prospecting Licenses
(PLs) located in two areas namely (i) the Central Africa Copperbelt
(Copperbelt), which is the largest and most prolific mineralized sediment-
hosted copper province known on Earth and which comprises four PLs
and (ii) the Zambezi area located within the Zambezi Belt of southern
Zambia that hosts a lower Katanga Supergroup succession which, although
less studied than its northern counterpart, also hosts a number of
Copperbelt-style occurrences and which comprises one PL
The fair value of the assets and liabilities acquired were as follows:
GBP
Ordinary shares (issued) 1,925,000
Fair value of assets and liabilities
acquired
* Assets 743
* Loan for exploration licenses (41,205)
------------
- (40,462)
Deemed fair value of
* exploration assets acquired 1,965,462
------------
Attributable to non-controlling
interest 481,250
Gross fair value of exploration
assets acquired 2,446,712
============
Resource Capital Partners Pty Ltd ("RCP") (Botswana Projects )
On 1 June 2021 the Company completed the acquisition of 100% of Resource
Capital Partners Pty Ltd ("RCP"), which holds a 100 per cent. interest
in eight Botswana Prospecting Licenses ("PLs") located in two areas
namely (i) the Kalahari Copperbelt (KC) that contains copper-silver
mineralisation and which is generally stratabound and hosted in metasedimentary
rocks that have been folded, faulted and metamorphosed to greenschist
facies during the Damara Orogeny and which comprises six PLs and (ii)
the Limpopo Mobile Belt ("Limpopo") set within the Motloutse Complex
of eastern Botswana, a transitional boundary between the Zimbabwe Craton
to the north and the Limpopo Mobile Belt to the south which comprises
two Pls;
The fair value of the assets and liabilities acquired were as follows:
GBP
Consideration
Equity consideration
* Ordinary shares (issued) 350,000
Fair value of assets and liabilities
acquired
-
* Assets
-
* Liabilities
--------------
-
Deemed fair value of
exploration assets acquired 350,000
==============
10. EXPLORATION AND EVALUATION ASSETS
Group Company
Exploration Group and Company
and evaluation Investment in
assets subsidiary
31 December 31 December 2021 31 December 2020
2021
GBP GBP GBP
Balance at beginning of - -
period
Acquisitions during the
period
* Namibia Projects (note 9) 1,374,249 521,500 -
* Zambia Projects (note 9) 2,446,712 1,925,000 -
* Botswana Projects (note 9) 350,000 350,000 -
Exploration expenditure 262,001 - -
Carried forward
at end of year 4,432,962 2,796,500 -
================ ================= ==================
Investments in subsidiaries are recorded at cost, which is the
fair value of the consideration paid less impairment.
The Company conducted an impairment review and is satisfied that
the carrying value of GBP2,796,500 is reasonable and no impairment
is necessary. (2020- Nil).
Principal Subsidiaries
Proportion
Country of of equity
incorporation Nature of shares held
Name & registered office address and residence business by Company
Resource Capital Partners Pty Ltd
Plot 102, Unit 13
Gaborone International Commerce Park, Base Metals
Gaborone, Botswana Botswana Exploration 100%
---------------- -------------- -------------
African Pioneer Zambia Ltd
Plot No397/0/1
Chipwenupwenu Road
Makeni, Lusaka Base Metals
PO Box 34033, Zambia Zambia Exploration 80%
---------------- -------------- -------------
Zamcu Exploration Pty Ltd
5 Eze Terrace
Hillarys
WA, 6025 Holding
AUSTRALIA Australia Company 100%
---------------- -------------- -------------
Manmar investments one hundred and Namibia Base Metals 85% via Zamcu
twenty nine Pty Ltd Exploration
36 Simeon Kambo Shixungileni Street,
Windhoek, Namibia
Manmar investments one hundred and Namibia Base Metals 85% via Zamcu
thirty six Pty Ltd Exploration
36 Simeon Kambo Shixungileni Street,
Windhoek, Namibia
-------- ------------- --------------
The Company's principal business is to explore opportunities
within the natural resources sector in Sub-Saharan Africa, with a
focus on base and precious metals including but not limited to
copper, nickel, lead and zinc. The Company has acquired the Namibia
Projects, Zambia Projects and Botswana Projects (see Note 9 for
details):
No current JORC 2012 compliant Mineral Resources exist for any
of the Projects and no Mineral Reserve estimates have been
completed for the Projects.
The Company's' main focus following Admission is on evaluating
and advancing the Namibian and Zambian Projects as the Botswana
Projects are the subject of the Conditional Botswana Licence Sale
Agreement described in the following paragraph.
The Botswana Projects have been acquired at an attractive
purchase price of GBP350,000, as although unexplored, they are
located in a highly prospective area for copper projects and it was
the Company's original intention to conduct an initial 18 month
exploration work programme to assess the prospectively of the
Botswanan Projects and assess the best way of developing them.
However, whilst working on the Admission, the Company was
approached by Sandfire Resources Limited, listed on the Australian
Stock Exchange and capitalised at approximately A$1 billion
("Sandfire"), who have a large established presence in the Kalahari
Copperbelt, with a proposal to acquire the Botswanan Projects. The
Company has seen this as an opportunity for Sandfire to take over
ownership and responsibility for the exploration stage of the
Botswanan assets whilst allowing the Group to share in the
potential upside should the exploration ultimately be successful in
establishing a mineable reserve. As a follow up to the initial
proposal, on 2 October 2021 entered into a two year option
agreement with Sandfire in relation to 4 of its 8 Botswana
prospecting licences for a cash payment of US$500,000 and the issue
of 107,272 Sandfire shares and a 24 months exploration expenditure
commitment of US$1,000,000 (the "Option Agreement"). The Company
has entered into the Option Agreement to allow an acceleration of
exploration activities on the 4 Kalahari Copper Belt prospecting
licences the subject of the Option Agreement (the "Included
Licences") funded by Sandfire. Funds received will also allow the
Company to accelerate exploration activities on the Company's 4
other prospecting licences in Botswana and its projects in Namibia
and Zambia. Sandfire has the in-country infrastructure and
technical expertise and financial resources to accelerate the rate
of expenditure on the Botswanan assets. In addition, as part of the
relationship with Sandfire, they came in as a cornerstone investor
into the Company making a US$500,000 (GBP365,000) investment in the
Company by way interest free unsecured loan notes in March 2021,
which on Listing converted into Ordinary Shares constituting 15 per
cent. of the Company's issued share capital.
11. TRADE AND OTHER RECEIVABLES
Group Company Group & Company
31 December 31 December 31 December
2021 2021 2020
GBP GBP GBP
Loans to subsidiaries - 877,562 -
Prepayments 20,979 20,979 420
Other debtors 743 - -
Total 21,722 898,541 420
------------ ------------ ----------------
Loans to subsidiaries are interest free and payable on
demand.
Group Receivables and other current assets are all due within
one year. The fair value of all receivables is the same as their
carrying values stated above.
12. TRADE AND OTHER PAYABLES
Group Company Group & Company
31 December 31 December 31 December
2021 2021 2020
GBP GBP GBP
Creditors 4,846 4,846 26,953
Accrued expenses 37,626 37,626 5,392
Other creditors 272 - -
Loan from directors 41,205 - -
Bridging loan facility from
parent - - 18,385
------------ ------------ ----------------
Total 50,730 42,472 50,730
------------ ------------ ----------------
In 2020, the company received an amount of GBP18,385 from its
previous parent (Tiger Royalties and Investments Plc) as part of a
bridging loan facility of GBP140,000. This loan was unsecured and
carried an interest rate of 10% accruing daily. The loan was repaid
on 6 April 2021.
Carrying amounts of trade and other payables approximate their
fair value.
13. LOANS
i. The Company owed GBP100,000 to Tiger Royalties and
Investments Plc ('Tiger'), the previous parent company (note 14).
The amount was unsecured, interest free and was converted in to
2,857,143 New Ordinary Shares in the Company as agreed between
Tiger and the Company under a settlement letter, dated 8 February
2021.
31 December 2021 31 December 2020
GBP GBP
Net present value of loan classified
as non-current liability - at inception - 38,554
Loan classified as equity contribution
in accordance with IFRS 9 - 61,446
Total - 100,000
------------------ -----------------
(ii).
31 December 2021 31 December 2020
GBP GBP
Net present value of loan classified
as non-current liability - at inception - 38,554
Interest for prior years - 10,182
Total at year end - 49,143
------------------ -----------------
On 21 October 2020, the Company entered into a convertible loan
note agreement with Sanderson Capital Partners ("Sanderson") for a
total investment of GBP150,000. Sanderson advanced the sum of
GBP125,000 under this agreement prior to 31 December 2020 and the
balancing GBP25,000 was received by the Company on 4 February 2021.
The loan notes did not have a fixed term and carried a zero coupon
rate. The loan notes were converted by Sanderson into Ordinary
shares of zero par value at a conversion price 1.75p per share on 1
June 2021 at the time of the listing. Sanderson received one
warrant per each share received on conversion of the loan notes
into Ordinary share in African Pioneer Plc at a strike price of 3.5
pence. These warrants are valid for a period of 3 years from the
date of issue of the convertible loan note 21 October 2023.
Equity contribution
31 December 2021 31 December 2020
Loan classified as equity contribution
in accordance with IFRS 9 in (i) above - 61,446
Loan notes subscribed during the year
in (ii) above - 125,000
Total at year end - 186,446
------------------ -----------------
14. CALLED UP SHARE CAPITAL
The share capital of African Pioneer Plc consists only of fully
paid ordinary shares with no par value. All shares are equally
eligible to receive dividends and the repayment of capital and
represent one vote at shareholders' meetings of the Company.
Number GBP
Authorised:
1,000,000,000 ordinary shares 1,000,000,000 n/a
of no par value
======================== ==================
2021 2020
Issued equity share Number GBP Number GBP
capital
--------------------- ------------ ---------- ----------- --------
Is sued and fu l ly
pa id
Ordinary shares 191,707,845 5,946,610 11,729,826 452,983
============ ========== =========== ========
Number of Share
Group and Company shares capital
GBP
-------------------------------- ----------- ---------
As at 1 January 2021 11,729,826 452,983
Shares issued during the period 179,978,023 5,493,622
Share issue costs * - (447,500)
Share based payment charge (8,834)
----------- ---------
As at 31 December 2021 191,707,849 5,490,271
----------- ---------
Movement in shares issued during the
period
Shares issued from placing on admission 01/06/2021 50,000,000 1,750,000
Shares issued on acquisition on subsidiaries 01/06/2021 84,642,857 2,962,500
Conversion of loans and share subscriptions 01/06/2021 39,847,503 615,000
Advisers' fees settled by shares 01/06/2021 3,239,364 113,377
Shares issued for additional 15% shareholding
in Manmar companies 27/08/2021 2,248,299 52,745
Total 179,978,023 5,493,622
----------- ---------
*includes transaction costs incurred in the listing process of
GBP360,000
On 7 December 2020, the Company consolidated its Ordinary shares
of zero par value on a 10 existing shares to 1 new share basis
which resulted in a reduction of the total number of Ordinary
shares in issue from 117,298,260 to 11,729,826 Ordinary shares of
zero par value.
On the same date, the Company also increased its authorised
shared capital from 500,000,000 shares to 1,000,000,000 shares.
25,000,000 two year warrants were issued to the placees on 1
June 2021exercisable at 5.25p per ordinary share
8,571,428 three year warrants were issued to Sanderson Capital
LLP on 1 June 2021 exercisable at 3.5p per ordinary share
A further 4,150,947 warrants were issued on 1 June 2021 for
services carried out as detailed in note 15.
15. WARRANTS AND SHARE BASED PAYMENT
On 1 June 2021 the Company granted the following warrants for
services carried out in relation to the listing of the Company on 1
June 2021 on the Standard Listing on the Official List trading on
the Main Market of the London Stock Exchange.
To Number Date granted Exercise Expiry Vesting conditions
price
1 June
Novum Securities Ltd 2,500,000 01/06/2021 3.5p 24 upon being granted
Quantum Capital and 1 June
Consulting Ltd 1,420,947 01/06/2021 3.5p 24 upon being granted
1 June
Cavendish Trust 230,000 01/06/2021 3.5p 23 upon being granted
----------
4,150,947
As a result of this the fair value of the share options was
determined at the date of the grant using the Black Scholes model,
using the following inputs:
Share price at the date of amendment 3.5p
Strike price 3.5p
Volatility 50%
Expected life 2/3 years
Risk free rate 0.17%
The 50% volatility rate is based on the average volatility from
historical data in this sector
The resultant fair value of the warrants was determined to be
GBP8,834, which has been taken to the share-based payment
reserve.
16. RELATED PARTY TRANSACTIONS
Cavendish Trust Company Limited (CTC) provides company
administration and secretarial services to the Company on normal
commercial terms as part of their normal business activity. As such
it is not normally treated as a related party. Fees paid to CTC
during the year include GBP9,300 (2020: GBP3,600), relating to
director's fees for the services of J. Cunningham-Davis, a director
of CTC. At the year-end a balance of GBPNil (2020: GBP900), was
outstanding.
Lion Mining Finance Limited, a company in which Colin Bird is
director and shareholder, has provided financial and technical
services to the Company amounting to GBP10,800 plus VAT in the year
(2020 - GBP9,000 plus VAT). At the year-end a balance of GBPNil
(2020: GBP900) was outstanding. The Board considers this
transaction to be on normal commercial terms and on an arm's length
basis.
On 20 June 2018, the Company entered into a loan agreement with
its parent company, Tiger Royalties and Investments Plc and was
advanced the sum of GBP100,000 under this agreement to settle
outstanding fees due to the Company's directors. See note 10 for
the terms of the loan. The amount was paid directly to its
directors (GBP50,000 each to Raju Samtani and Colin Bird). This
loan has now been settled see note 13.
On 28 January 2021, the Company entered into a loan agreement
with its parent company, Tiger Royalties and Investments Plc for a
bridging loan facility of up to GBP140,000. See note 9 for details
of the terms for this loan. A pre-existing amount of GBP18,385
outstanding as at 31 December 2020 was included in the 28 January
2021 facility. A further sum of GBP112,981 was advanced on 29
January 2021 (post year-end) under this facility. This loan has now
been settled see note 13.
In October 2020 a loan of US$ 54,940 (GBP41,250) was advanced to
African Pioneer Zambia Ltd jointly by Colin Bird (US$ 27,470)and
Raju Samtani (US$ 27470) in order to acquire certain licenses
Intragroup Loans
Loans with group companies entered into during the year are as
follows. Loans are interest free and repayable on demand.
2021 2020
GBP GBP
--------------- ----------------
Zamcu Exploration Pty Ltd to African 749,952 -
Pioneer Plc
--------------- ----------------
Resource Capital Partners Pty 32,199 -
Ltd to African Pioneer Plc
--------------- ----------------
African Pioneer Zambia Ltd to 95,411 -
African Pioneer Plc
--------------- ----------------
Issue of shares at the IPO as disclosed in the Prospectus
(a) The Company entered into a Share Purchase Agreement, dated
29 October 2020 ("Zamcu SPA") with Tonehill Pty Ltd, Coreks Super
Pty Ltd and Breamline Pty Limited ("Zamcu Sellers") under which the
Zamcu Sellers (which are controlled by Christian Cordier) agreed to
sell to the Company their collective 100 per cent. ownership
interests in Zamcu in return for 10,000,000 shares issued at the
IPO with an issue price of 3.5 pence per share in the Company
("Consideration Shares"). The sale is subject to a 12 month lock-in
during which the Zamcu Sellers are not permitted to sell their
Consideration Shares in the Company, followed by a 12 month orderly
markets period during which the Zamcu Sellers are required to work
with the Company's broker for 30 days prior to making any sale.
(b) The Company entered into a Share Purchase Agreement, dated
29 October 2020 ("RCP SPA") with M&A Wealth Pty Ltd and
Breamline Pty Limited (a company controlled by Christian Cordier)
("RCP Sellers") under which the RCP Sellers agreed to sell to the
Company their collective 100 per cent. ownership interests in RCP
in return for 10,000,000 Consideration Shares in the Company issued
at the IPO, of which each RCP Seller received 5,000,000
Consideration Shares. The sale is subject to a 12 month lock-in
during which the RCP Sellers are not permitted to sell their
Consideration Shares in the Company, followed by a 12 month orderly
markets period during which sellers are required to work with the
Company's broker for 30 days prior to making any sale.
(c) The Company entered into a Share Purchase Agreement, dated
25 November 2020 ("APZ SPA") with Raju Samtani, Colin Bird, Mohamad
Ahmad, Caleb Amos Mulenga, Lukonde Makungu and Camden Park Trading
(a company controlled by Colin Bird) ("AP Zambia Sellers") under
which the AP Zambia Sellers agreed to sell to the Company their
collective 80 per cent. ownership interests in African Pioneer
Zambia Pty Limited ("AP Zambia") in return for 55,000,000
Consideration Shares in the Company issued at the IPO, in
proportion to their existing holdings of which 15,000,000
Considerations Shares were issued to each of Colin Bird and Raju
Samtani and 5,000,000 Consideration Shares were issued to Camden
Park Trading. The sale is subject to a 12 month lock-in during
which the AP Zambia Sellers are not permitted to sell their
Consideration Shares in the Company, followed by a 12 month orderly
markets period during which sellers are required to work with the
Company's broker for 30 days prior to making any sale.
2. Directors' Letters of Appointment and Service Agreements as
disclosed in the Prospectus
(a) Pursuant to an agreement dated 24 May 2021, the Company
renewed the appointment of James Cunningham-Davis as a Director.
The appointment continues unless terminated by either party giving
to the other 3 months' notice in writing. James Cunningham-Davis is
entitled to director's fees of GBP12,000 per annum for being a
director of the Company plus reasonable and properly documented
expenses incurred during the performance of his duties which will
be invoiced by Cavendish Trust Company Ltd an Isle of Man Trust
Company that James Cunningham-Davis is a founder and managing
director of. James Cunningham-Davis is not entitled to any pension,
medical or similar employee benefits. The agreement replaces all
previous agreements with James Cunningham-Davis and/or Cavendish
Trust Company Ltd in relation to the appointment of James
Cunningham-Davis as a director of the Company.
(b) Pursuant to an agreement dated 24 May 2021, the Company
appointed Kjeld Thygesen as a non-executive Director with effect
from the date of the IPO. The appointment continues unless
terminated by either party giving to the other 3 months' notice in
writing and Kjeld Thygesen is entitled to director's fees of
GBP18,000 per annum for being a director of the Company plus
reasonable and properly documented expenses incurred during the
performance of his duties. Kjeld Thygesen is not entitled to any
pension, medical or similar employee benefits.
(c) Pursuant to an agreement dated 24 May 2021, the Company
renewed the appointment of Colin Bird as a Director. The
appointment continues unless terminated by either party giving to
the other 3 months' notice in writing. Colin Bird is entitled to
director's fees of GBP18,000 per annum for being a director of the
Company plus reasonable and properly documented expenses incurred
during the performance of his duties. Colin Bird is not entitled to
any pension, medical or similar employee benefits. The agreement
replaces all previous agreements with Colin Bird in relation to his
appointment as a director of the Company.
(d) Pursuant to a consultancy agreement dated 24 May 2021, the
Company has, with effect from the date of the IPO, appointed Colin
Bird as a consultant to provide technical advisory services in
relation to its current and future projects including but not
limited to assessing existing geological data and studies, existing
mine development studies and developing exploration programs and
defining the framework of future geological and mine study reports
(the "Colin Bird Services"). The appointment continues unless
terminated by either party giving to the other 3 months' notice in
writing. Colin Bird is entitled to fees of GBP3,500 per month for
being a consultant to the Company plus reasonable and properly
documented expenses incurred during the performance of the Colin
Bird Services.
(e) Pursuant to an agreement dated 24 May 2021, the Company
renewed the appointment of Raju Samtani. The appointment continues
unless terminated by either party giving to the other 3 months'
notice in writing. Raju Samtani is entitled to director's fees of
GBP18,000 per annum for being a director of the Company plus
reasonable and properly documented expenses incurred during the
performance of his duties. Raju Samtani is not entitled to any
pension, medical or similar employee benefits. The agreement
replaces all previous agreements with Raju Samtani in relation to
his appointment as a director of the Company.
(f) Pursuant to a consultancy agreement dated 24 May 2021, the
Company has ,with effect from the date of Admission, appointed Raju
Samtani as a financial consultant to provide financial advisory
services to the Company (the "Raju Samtani Services"). The
appointment continues unless terminated by either party giving to
the other 3 months' notice in writing. Raju Samtani is entitled to
fees of GBP2,667 per month for being a consultant to the Company
plus reasonable and properly documented expenses incurred during
the performance of the Raju Samtani Services.
(g) Pursuant to an agreement dated 24 May 2021, the Company
appointed Christian Cordier as a Director with effect from the date
of Admission. The appointment continues unless terminated by either
party giving to the other 3 months' notice in writing. Christian
Cordier is entitled to director's fees of GBP18,000 per annum for
being a director of the Company plus reasonable and properly
documented expenses incurred during the performance of his duties.
Christian Cordier is not entitled to any pension, medical or
similar employee benefits.
(h) Pursuant to a consultancy agreement dated 24 May 2021, with
Mystic Light Pty Ltd a personal service company of Christian
Cordier the Company has secured the services of Christian Cordier,
with effect from the date of the IPO, as a business development
consultant to provide business development l advisory services to
the Company in relation to its existing and future projects (the
"Christian Cordier Services"). The appointment continues unless
terminated by either party giving to the other 3 months' notice in
writing. Mystic Light Pty Ltd is entitled to fees of GBP1,000 per
month for providing the Christian Cordier Services plus reasonable
and properly documented expenses incurred during the performance of
the Christian Cordier Services.
17. POST BALANCE SHEET EVENTS
On 19 January 2022 the Company and its 80% owned subsidiary
African Pioneer Zambia Ltd ("African Pioneer Zambia") entered into
an option agreement with First Quantum Minerals Ltd ("First
Quantum") (listed on the Toronto Stock Exchange FM.TO) in relation
to 4 of the 5 Zambian exploration licences held by African Pioneer
Zambia (the "Option Agreement").
The four exploration licences the subject of the Option
Agreement are in the highly prospective Central Africa Copperbelt
in northwest Zambia which is the largest and most prolific
mineralized sediment- hosted copper province in the world and are
located less than 100km from First Quantum's giant Sentinel copper
mine.
The exploration licenses include geological formations similar
in age and rock type to that hosting the major copper deposits of
the Copperbelt.-- During the initial 18 month option period First
Quantum has the right but not the obligation to spend US500,000 on
each of the exploration licences. At this stage First Quantum will
not have earned any shares in African Pioneer Zambia, just the
right to proceed to take one or more of the properties into the
First Earn In Period by issuing an Option Exercise Notice.
During the First Earn In Period, First Quantum then has 2 years
when it has the right but not the obligation to prepare a Technical
Report in respect of the Zambian Projects demonstrating an
Indicated Mineral Resource of at least 300,000 tonnes of contained
copper (the "Technical Report Requirement"). First Quantum is to
fund the Technical Report. Once the Technical Report is issued
First Quantum has the right to be issued shares equal to a 51%
shareholding in African Pioneer Zambia. This will also trigger the
Second Earn-In Period.
In the Second Earn-In Period First Quantum shall have the right
but not the obligation to complete all necessary mining,
metallurgical and development studies to establish a mine at the
Property and make a public announcement that it intends to proceed
towards commercial development of a Mine on the Property (a
"Decision to Mine"). First Quantum is to fund all costs related to
the Decision to Mine. Once First Quantum announces a Decision to
Mine First Quantum has the right to be issued shares in African
Pioneer Zambia to increase their 51% shareholding in African
Pioneer Zambia to 75%.
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END
FR SDEFISEESEIM
(END) Dow Jones Newswires
June 30, 2022 11:56 ET (15:56 GMT)
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