TIDMBRES
RNS Number : 4789B
Blencowe Resources PLC
30 January 2020
Blencowe Resources Plc
(" Blencowe Resources Plc" or the "Company")
Annual Report and Financial Statements For the year ended 30
September 2019
The Board of Blencowe Resources Plc is pleased to announce its
annual report and audited financial results for the year ended 30
September 2019.
Electronic copies of the annual report will be available at the
Company's website https://blencoweresourcesplc.com
- -
Blencowe Resources plc T: +44(0)1624 681 250
Cameron Pearce - Chairman
Brandon Hill Capital Limited T: +44 (0)20 3463 5000
Financial Adviser & Broker
Oliver Stansfield/Jonathan Evans
Chairman's Statement
Business of the Company
The Company was incorporated on 18 September 2017 as a private
company with limited liability under the laws of England and Wales
under the Companies Act 2006 with registered number 10966847 and
was re-registered as a public limited company on 13 July 2018. It
is domiciled and its principal place of business is in the United
Kingdom.
Its entire issued share capital, being 31,666,664 ordinary
shares of GBP0.005 ("Ordinary Shares") each was admitted to the
Official List (by way of a Standard Listing under Chapter 14 of the
Listing Rules) on the 18 April 2019 and to trading on the London
Stock Exchange's Main Market for listed securities. Since
incorporation the Company has raised a total of GBP740,000 (before
costs).
Blencowe was formed for the purposes of acquiring a natural
resources asset and on 13 May 2019 it announced that it had entered
into a Heads of Agreement with Consolidated Africa Limited ("CRA")
and New Energy Minerals Africa Pty Ltd ("New Energy") for the
proposed assignment to the Company of a binding option for it to
acquire 100% of the share capital of Consolidated African Resources
(Uganda) Ltd ("CARU"), a subsidiary of CRA, by way of a reverse
takeover ("Transaction"). CRA has given its binding consent to the
assignment of the option. CARU is a Ugandan registered company
which is the owner of the Orom Graphite Project in northern Uganda
(the "Orom Graphite Project").
Blencowe will, subject to finance, acquire the entire share
capital of CARU with the total aggregate consideration payable by
the Company being GBP2,000,000 (two million pounds), to be
satisfied in full by the issue of 33,333,333 new Ordinary Shares at
an implied price of GBP0.06 per share, of which GBP500,000 will be
payable to New Energy as consideration for the assignment of the
option and GBP1,500,000 will be payable to CRA as the acquisition
price for CARU. Completion of the Transaction will be conditional
on Blencowe raising working capital for the enlarged group to
further develop the Orom Graphite Project. A budget and work
programme for the Orom Graphite Project has now been agreed, the
quantum of this fundraise at the date of this announcement is
GBP2,000,000.
Following the end of the financial year, the Company entered
into a share purchase agreement with CRA and New Energy dated 24
October 2019. The acquisition remains subject to completion of the
fundraising and re-listing of the enlarged group on the London
Stock Exchange. Accordingly, there is no certainty that it will be
completed. If the Transaction is completed, it will constitute a
reverse takeover under the Listing Rules and will be subject to
approval by shareholders of the Company at a general meeting. As
the Company is unable to provide full disclosure under Rule 5.6.15
of the Listing Rules, the Company requested the FCA to suspend
trading of its Ordinary Shares on the London Stock Exchange,
pending publication of a prospectus in relation to the Transaction
and the fundraising and calling the Annual General Meeting to
approve the Transaction.
We are pursuing a metal that has strong future for the next 20
years given that graphite is the largest component of the lithium
battery. We believe that the Orom Graphite Project can be globally
significant due to the high-quality product and scale of the target
resource. The graphite is characterised by large and jumbo flake
size with both high grade and purity that is in short supply and
demands an exponentially higher price. Also, the Ugandan government
who are very keen to develop their mining sector recently granted
CARU a 21 year mining licence over 19sqkm of the Orom Graphite
Project. The board of Blencowe looks forward to keeping
shareholders informed of further developments in what we believe is
a very exciting company making transaction.
Future developments
Whilst capital raising is ongoing, there is a temporary
suspension of trading in shares on the London Stock Exchange and
Blencowe will seek readmission once the Transaction is
completed.
Cameron Pearce
Executive Chairman
29/12/2020
Strategic report for the year ended 30 September 2019.
The Directors present the Strategic Report for the year ended 30
September 2019.
Results
The Company made a loss for the year of GBP243,119 (2018:
GBP163,520). The 2018 figures have been restated due to a
reallocation of expenses, see note 2.6.
Business model, review of the business and future
developments
The Company was formed to undertake an acquisition of a target
company or business. During the period under review the Directors'
have considered a number of opportunities available to them. The
Company on 13 May 2019 announced that it had entered into Heads of
Agreement with Consolidated Africa Limited ("CRA") and New Energy
Minerals Africa Pty Ltd ("New Energy") for the proposed assignment
to the Company of a binding option for it to acquire 100% of the
share capital of Consolidated African Resources (Uganda) Ltd
("CARU"), a subsidiary of CRA, by way of a reverse takeover
("Transaction"). Further information on the Company's activities is
contained in the Chairman's Statement noted above.
Key performance indicators
At this stage in its development, the Company is focusing on
carrying out the Transaction and the related fundraising. If the
Company achieves completion of the Transaction, then financial,
operational, health and safety and environmental KPIs may become
relevant and will be measured and reported as appropriate. As such
the only KPI the Company monitors is whether it can successfully
identify and secure an investment opportunity.
Employees
With the exception of the Directors the Company does not have
any employees. The Board of Directors' is comprised of three
males.
Principal risks and uncertainties and risk management
The Company operates in an uncertain environment and is subject
to a number of risk factors. The Directors consider the following
risk factors are of particular relevance to the Company's
activities and to any investment in the Company. It should be noted
that the list is not exhaustive and that other risk factors not
presently known or currently deemed immaterial may apply.
The Directors are confident that they have put in place a strong
management team capable of dealing with the above issues as they
arise.
The Company will be dependent on the ability of the Directors to
identify suitable investment opportunities and to implement the
Company's strategy. Following the end of the financial year, the
Company entered into a share purchase agreement with CRA and New
Energy dated 24 October 2019. The acquisition remains subject to
completion of the fundraising and re-listing of the enlarged group
on the London Stock Exchange. Accordingly, there is no certainty
that it will be completed. If the Transaction is completed, it will
constitute a reverse takeover under the Listing Rules and will be
subject to approval by shareholders of the Company at a general
meeting. As the Company is unable to provide full disclosure under
Rule 5.6.15 of the Listing Rules, the Company requested the FCA to
suspend trading of its Ordinary Shares on the London Stock
Exchange, pending publication of a prospectus in relation to the
Transaction and the fundraising and calling the Annual General
Meeting to approve the Transaction.
Financial risk management
The Company's principal financial instruments comprise cash
balances, accounts payable and accounts receivable arising in the
normal course of its operations.
The Company's objectives when managing capital are to safeguard
the Company's ability to continue as a going concern in order to
provide returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure to reduce
the cost of capital.
In order to maintain or adjust the capital structure, the
Company may adjust the amount of dividends paid to shareholders,
return capital to shareholders, issue new shares or sell assets to
reduce debt.
As at 30 September 2019 there is no significant exposure to
liquidity or price risk. The only credit risk applicable is over
the cash balance which is held with a reputable bank and trade
debtors (see note 2.4).
Viability statements
In accordance with provision C.2.2. of the UK Corporate
Governance Code, the Board has assessed the prospects of the
Company over a five-year period, taking account of the Company's
current position and principal risks.
Time frame
The Board believes that five years is the most appropriate time
frame over which the Board should assess the long-term viability of
the Company. The Company's current activities do not generate any
revenues or positive operating cash flow, and the development of
the Orom Graphite Project to commence production and generate
revenues will require significant capital expenditures. The Orom
Graphite Project is not expected to generate positive net cash flow
until approximately 2025, some five years from now.
Assessing viability
The main assumption in the Board making its viability assessment
is the ability of the Company to raise further funds in order to
progress from the exploration phase into feasibility and eventually
into production of revenues. The Company may not be able to obtain
additional financing as and when needed which could result in a
delay or indefinite postponement of exploration and development
activities.
Principal risk
The Directors have carried out a robust assessment of the
principal risks facing the Company as described on the preceding
pages including those that threaten its business model, future
performance, solvency or liquidity. The Directors are confident
that they have put in place a strong management team capable of
dealing with the risk management in order to safeguard the
Company's assets.
In addition, the management team has wide-ranging expertise in
mineral exploration which, together with a flexible cost structure,
would enable the Company to adapt its organisation to changes in
circumstances.
Based on the financial impact of the analysis outlined above and
the associated risks, management actions and controls that are
either in place or could be implemented, the Board has been able to
conclude that the Company will be able to deliver the Orom Graphite
Project.
Confirmation of viability
Taking account of these matters, the Directors have a reasonable
expectation that the Company will be able to continue in operation
and meet its liabilities as they fall due over the period to
December 2023, assuming that the financing referred to above is
completed as described. The company's going concern statement is
detailed in note 2.5.
Cameron Pearce
Director
29/12/2020
Directors' Report for the year ended 30 September 2019
The Directors submit their report with the audited Financial
Statements for the year ended 30 September 2019.
Principal activity
The Company was formed to undertake an acquisition of a target
company or business.
Results for the year and distributions
The results are set out in the Statements of Comprehensive
Income. The total comprehensive loss attributable to the equity
holders of the Company for the year was GBP243,119 (2018:
GBP163,520). The Company received no income, and the full amount of
the loss is due to expenses incurred in capital raising (to the
extent not deducted from share premium), identifying and evaluating
suitable acquisition targets, and general corporate overheads.
The Company paid no distribution or dividends during the
year.
Directors
The Directors who held office during the year and to the date of
this report, together with details of their interest in the shares
of the Company at 30 September 2019 and the date of this report
were:
Number of Ordinary
Shares
Appointed 13 November
Sam Quinn 2017 4,000,000
Appointed 13 November
Cameron Pearce 2017 6,000,000
Alexander Passmore Appointed 18 May 2018 1,500,000
Substantial shareholders
No single person directly or indirectly, individually or
collectively, exercises control over the Company. The Directors are
aware of the following persons, who had an interest in 3% or more
of the issued ordinary share capital of the Company as at 30
September 2019:
Shareholder % of issued share capital of the Company
Cameron Pearce 18.95%
Sam Quinn 12.63%
JIM Nominees Limited 10.26%
BNY (OCS) Nominees Limited 9.97%
Ralston Family Trust 6.32%
Alexander Passmore 4.74%
Spreadex Limited 4.74%
Bushwood Nominees Pty Ltd 3.95%
Jameker Pty Ltd 3.95%
The PSAR Family Trust 3.16%
Salmon Brick Pty Ltd 3.16%
Azelea Family Holdings Pty Ltd 3.16%
Employee and Greenhouse Gas (GHG) Emissions
The Company is trading with no employees with the exception of
the Directors, and therefore has minimal carbon emissions.
The Company promotes a policy for the creation of equal and
ethnically diverse employment opportunities including with respect
to gender
Corporate Governance
The Company recognises the importance of, and is committed to,
high standards of Corporate Governance. At the date of this
Document, the Company complies with the corporate governance regime
applicable to the Company.
In addition, the Company intends to voluntarily observe the
requirements of the UK Corporate Governance Code, save as set out
below. As at the date of the financial statements the Company is
incompliance with the UK Corporate Governance Code with the
exception of the following:
-- Given the composition of the Board, certain provisions of the
UK Corporate Governance Code (in particular the provisions relating
to the division of responsibilities between the Chairman and chief
executive and executive compensation), are considered by the Board
to be inapplicable to the Company. In addition, the Company does
not comply with the requirements of the UK Corporate Governance
Code in relation to the requirement to have a senior independent
director and the Board's committees will not, at the outset, have
three independent non-executive directors.
-- The UK Corporate Governance Code also recommends the
submission of all directors for re-election at annual intervals. No
Director will be required to submit for re-election until the first
annual general meeting of the Company following the
Acquisition.
-- Until the Acquisition is made, the Company will not have
nomination, remuneration, audit or risk committees. The Board as a
whole will instead review its size, structure and composition, the
scale and structure of the Directors' fees (taking into account the
interests of Shareholders and the performance of the Company), 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. Following the
Acquisition, the Board intends to put in place nomination,
remuneration, audit and risk committees.
As at the date of the financial statements, the Board has a
share dealing code that complies with the requirements of the
Market Abuse Regulations. All persons discharging management
responsibilities (comprising only the Directors at the date of this
Document) shall comply with the share dealing code from the date of
Admission.
Set below are Blencowe Resources Plc's corporate governance
practices for the year ended 30 September 2019.
Leadership
The Company is headed by an effective Board which is
collectively responsible of the long term success of the
Company.
The role of the Board - The Board sets the Company's strategy,
ensuring that the necessary resources are in place to achieve the
agreed strategic priorities, and reviews management and financial
performance. It is accountable to shareholders for the creation and
delivery of strong, sustainable financial performance and long-term
shareholder value. To achieve this, the Board directs and monitors
the Company's affairs within a framework of controls which enable
risk to be assessed and managed effectively. The Board also has
responsibility for setting the Company's core values and standards
of business conduct and for ensuring that these, together with the
Company's obligations to its stakeholders, are widely understood
throughout the Company. The Board has a formal schedule of matters
reserved which is provided later in this report.
Board Meetings - The core activities of the Board are carried
out in scheduled meetings of the Board. These meetings are timed to
link to key events in the Company's corporate calendar and regular
reviews of the business are conducted. Additional meetings and
conference calls are arranged to consider matters which require
decisions outside the scheduled meetings. During the year, the
Board met on 1 occasion.
Outside the scheduled meetings of the Board, the Directors
maintain frequent contact with each other to discuss any issues of
concern they may have relating to the Company or their areas of
responsibility, and to keep them fully briefed on the Company's
operations.
-- Matters reserved specifically for Board - The Board has a
formal schedule of matters reserved that can only be decided by the
Board. The key matters reserved are the consideration and approval
of;
-- The Company's overall strategy;
-- Financial statements and dividend policy;
-- Management structure including succession planning,
appointments and remuneration; material acquisitions and disposal,
material contracts, major capital expenditure projects and
budgets;
-- Capital structure, debt and equity financing and other matters;
-- Risk management and internal controls;
-- The Company's corporate governance and compliance arrangements; and
-- Corporate policies
Summary of the Board's work in the year - During the year, the
Board considered all relevant matters within its remit, but focused
in particular on the establishment of the Company and the
identification of a suitable investment opportunity for the Company
to pursue.
Attendance at meetings:
Member Meeting attended
Cameron Pearce Non-Executive Chairman 1
Sam Quinn Non-Executive Director 1
Alexander Passmore Non-Executive Director 1
The Board is pleased with the level of attendance and
participation of Directors at Board and committee meetings.
The Chairman, Cameron Pearce, sets the Board Agenda and ensures
adequate time for discussion.
Non-executive Directors - The non-executive Directors bring a
broad range of business and commercial experience to the Company
and have a particular responsibility to challenge independently and
constructively the performance of the Executive management (where
appointed) and to monitor the performance of the management team in
the delivery of the agreed objectives and targets.
Non-executive Directors - are initially appointed for a term of
three years, which may, subject to satisfactory performance and
re-election by shareholders, be extended by mutual agreement.
Other governance matters - All of the Directors are aware that
independent professional advice is available to each Director in
order to properly discharge their duties as a Director. In
addition, each Director and Board committee has access to the
advice of the Company Secretary.
The Company Secretary - The Company Secretary is FIM Secretaries
Limited who is retained on a consultancy basis. FIM Secretary
Limited is available to Directors and responsible for the Board
complying with UK procedures.
Effectiveness
For the period under review the Board comprised of an Non -
Executive Chairman and two non-executive Directors.
The Directors are of the view that the Board and its committees
consist of Directors with an appropriate balance of skills,
experience, independence and diverse backgrounds to enable them to
discharge their duties and responsibilities effectively
Independence - None of the Directors are considered to be
independent. It is intended that additional Directors will be
appointed in future and that independence will be one of the key
factors taken into account at that time. As at the date of this
Document no prospective Directors have been identified and no
arrangements exist (formal or informal) for the appointment of any
other Director..
Appointments - the Board is responsible for reviewing and the
structure, size and composition of the Board and making
recommendations to the board with regards to any required
changes.
Commitments - All Directors have disclosed any significant
commitments to the Board and confirmed that they have sufficient
time to discharge their duties.
Induction - All new Directors received an induction as soon as
practical on joining the Board.
Conflict of interest - A Director has a duty to avoid a
situation in which he or she has, or can have, a direct or indirect
interest that conflicts, or possibly may conflict with the
interests of the Company. The Board had satisfied itself that there
is no compromise to the independence of those Directors who have
appointments on the Boards of, or relationships with, companies
outside the Company. The Board requires Directors to declare all
appointments and other situations which could result in a possible
conflict of interest.
Shareholder relations
Communication and dialogue - Open and transparent communication
with shareholders is given high priority and there is regular
dialogue with institutional investors, as well as general
presentations made at the time of the release of the annual and
interim results. All Directors are kept aware of changes in major
shareholders in the Company and are available to meet with
shareholders who have specific interests or concerns. The Company
issues its results promptly to individual shareholders and also
publishes them on the Company's website:
www.blencoweresourcesplc.com. Regular updates to record news in
relation to the Company and the status of its exploration and
development programmes are included on the Company's website.
Shareholders and other interested parties can subscribe to receive
these news updates by email by registering online on the website
free of charge.
The Directors are available to meet with institutional
shareholders to discuss any issues and gain an understanding of the
Company's business, its strategies and governance. Meetings are
also held with the corporate governance representatives of
institutional investors when requested.
Annual General Meeting - At every AGM individual shareholders
are given the opportunity to put questions to the Chairman and to
other members of the Board that may be present. Notice of the AGM
is sent to shareholders at least 21 working days before the
meeting. Details of proxy votes for and against each resolution,
together with the votes withheld are announced to the London Stock
Exchange and are published on the Company's website as soon as
practical after the meeting.
Responsibility statement
The Directors are responsible for preparing the Directors'
Report and the Financial Statements in accordance with applicable
law and regulations. In addition, the Directors have elected to
prepare the Financial Statements in accordance with International
Financial Reporting Standards ("IFRSs"), as adopted by the European
Union ("EU").
The Financial Statements are required to give a true and fair
view of the state of affairs of the Company and of the 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;
-- present information and make judgements that are reasonable,
prudent and provides relevant, comparable and understandable
information.
-- provide additional disclosures when compliance with the
specific requirements in IFRS is insufficient to enable users to
understand the impact of particulars transactions, other events and
conditions on the entity's financial position and financial
performance; and
-- make an assessment of the Company's ability to continue as a going concern.
The Directors are responsible for keeping proper accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time its
financial position of the Company to enable them ensure that the
financial statements comply with the requirements of the Companies
Act 2006. They have general responsibility for taking such steps as
are reasonably open to them to safeguard the assets of the Company
and to prevent and detect fraud and other irregularities.
The Directors are responsible for the maintenance and integrity
of the corporate and Financial Statements. Legislation governing
the preparation and dissemination of Financial Statements may
differ from one jurisdiction to another.
We confirm that to the best of our knowledge:
-- the Financial Statements , prepared in accordance with
International Financial Reporting Standards as adopted by the EU,
give a true and fair view of the assets, liabilities, financial
position and profit or loss of the Company for the period;
-- the Director's report includes a fair review of the
development and performance of the business and the position of the
company, together with a description of the principal risks and
uncertainties that they face.
-- 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 company's performance,
business model and strategy.
Embed effective risk management, considering both opportunities
and threats, throughout the organisation.
The Directors are responsible for maintaining the Company's
systems of controls and risk management in order to safeguard its
assets.
Risk is monitored and assessed by the Board who meet regularly
and are responsible for ensuring that the financial performance of
the Company is properly monitored and reported. This process
includes reviews of annual and interim accounts, results
announcements, internal control systems, procedures and accounting
policies.
The Board receives guidance from FIM Capital Limited, the
administrator to the Company, covering updates to relevant
legalisation and rules to ensure they remain fully informed and
able to make informed decisions.
Subsequent events
Please see note 14 for details of the Company's subsequent
events.
Auditors
So far as the directors are aware, there is no relevant audit
information on which the Company's auditors are unaware, and they
have taken all steps that they ought to have taken as directors in
order to make themselves aware of any relevant audit information
and to establish that the Company's auditors are aware of that
information.
The auditors, Crowe U.K LLP, have expressed their willingness to
continue in office and a resolution to reappoint them will be
proposed at the Annual General Meeting.
By Order of the Board
Cameron Pearce
Director
29/12/2020
Directors' Remuneration report
The Directors' Remuneration Report sets out the Company's policy
on the remuneration of Directors together with the details of
Directors' remuneration packages and services contracts for the
period 1 November 2018 to 30 September 2019.
The Board as a whole will review the scale and structure of the
Directors' fees, taking into account the interests of the
shareholders and the performance of the Company and Directors.
The items included in this report are unaudited unless otherwise
stated.
The Company maintains contact with its shareholders about
remuneration in the same way as other matters and, as required by
Section 439 of the Companies Act 2006, this remuneration report
will be put to an advisory vote of the Company's shareholders at
the forthcoming Annual General Meeting.
Statement of Blencowe Plc's policy on Directors'
Remuneration
As set out in the Company's Prospectus dated 11 April 2019, each
of the Directors may be paid a fee at such rate as may from time to
time be determined by the Board. All the Directors are entitled to
be reimbursed by the Company for travel, hotel and other expenses
incurred by them in the course of their directors' duties relating
to the Company. All the Directors are required to serve on the
audit/remuneration committee, and, where possible, attend all
committee meetings, general meetings, board meetings, and provide
guidance and direction in the planning, developing and enhancing
the future strategic direction of the Company.
Any fees payable to the Directors after an Acquisition will be
determined as part of the negotiations for the Acquisition, and
will be dependent on whether the Directors remain on the board of
the Company in any event.
There have been no changes to the Directors' remuneration or
remuneration policy since the publication of the Company's
Prospectus dated 11 April 2019.
Terms of employment
Cameron Pearce was appointed on 8 June 2018 by the Company to
act as a Non-Executive Director and Chairman of the Company with
fees of GBP36,000 per annum. The appointment is for an initial term
of 24 months and thereafter can be terminated by the Company on six
months written notice or Mr Pearce on three months written notice.
If there is a change of control (as defined in the letter of
appointment), Mr Pearce will be entitled to 100% of his annual fee
as a lump sum payment if the Company terminates his employment, or
if Mr Pearce chooses to terminate his appointment within 12 months
following a change of control.
Sam Quin was appointed on 8 June 2018 by the Company to act as a
Non-Executive Director with fees of GBP24,000 per annum. The
appointment is for an initial term of 24 months and thereafter the
appointment can be terminated by the Company on six months written
notice or Mr Quinn on three months written notice. If there is a
change of control (as defined in the letter of appointment), Mr
Quinn will be entitled to 100% of his annual fee as a lump sum
payment if the Company terminates his employment, or if Mr Quinn
chooses to terminate his appointment within 12 months following a
change of control.
Alex Passmore has been appointed by the Company to act as a
Non-Executive Director with fees of GBP12,000 per annum. The
appointment is for an initial term of 24 months and thereafter the
appointment can be terminated by the Company on six months written
notice or Mr Passmore on three months written notice. If there is a
change of control (as defined in the letter of appointment), Mr
Passmore will be entitled to 100% of his annual fee as a lump sum
payment if the Company terminates his employment, or if Mr Passmore
chooses to terminate his appointment within 12 months following a
change of control.
Policy for new appointments
Without prejudice to the power of the Company to appoint any
person to be a Director pursuant to the Articles the Board shall
have power at any time to appoint any person who is willing to act
as a Director, either to fill a vacancy or as an addition to the
existing Board, but the total number of Directors shall not exceed
any maximum number fixed in accordance with the Articles. Any
Director so appointed shall hold office only until the annual
general meeting of the Company next following such appointment and
shall then be eligible for re-election but shall not be taken into
account in determining the number of Directors who are to retire by
rotation at that meeting. If not re-appointed at such annual
general meeting, he shall vacate office at the conclusion
thereof.
Base salary levels will take into account market data for the
relevant role, internal relativities, the individual's experience
and their current base salary. Where an individual is recruited
below market norms, they may be re-aligned over time (e.g. two to
three years), subject to performance in the role. Benefits will
generally be in accordance with the approved policy.
Set out below are the emoluments of the Directors:
12 months to 13 months to
30 Sep 2019 30 Sep 2018
Restated
GBP GBP
Cameron Pearce 36,000 30,000
Sam Quinn 22,000 22,000
Alexander Passmore 12,000 4,000
------------- -------------
Total 70,000 56,000
------------- -------------
The percentage of directors' emoluments of the total
administrative costs for the year is 29% (2018: 34%).
Statement of Directors' shareholding and share interest
The Directors who served during the year ended to 30 September
2019 , and their interests at that date, are disclosed on page
below. There were no changes between the balance sheet date and the
date of approval of this report.
The Directors have indicated to the Company that they will not
make applications in the Placing of New Ordinary Shares as set on
the Company's Prospectus dated 11 April 2019.
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.
The Company does not have any pension plans for any of the
Directors and does not pay pension amounts in relation to their
remuneration.
The Company has not paid out any excess retirement benefits to
any Directors or past Directors. The Company has not paid any
compensation to past Directors.
As the Company currently has no trade, no performance graph and
table has been included but will be included in future accounting
periods.
The directors' remuneration policy will develop as and when the
company makes an acquisition and will depend upon future
circumstances.
By Order of the Board
Cameron Pearce
Director
29/12/2020
Independent Auditor's Report to the Members of Blencowe
Resources Plc
Opinion
We have audited the financial statements of Blencowe Resources
Plc for the year ended 30 September 2019 which comprise the
Statement of Comprehensive Income, Statement of Financial Position,
Statement of Changes in Equity, Statement of Cash Flows and notes
to the financial statements, 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 European Union.
In our opinion, the financial statements:
-- give a true and fair view of the state of the company's
affairs as at 30 September 2019 and of its loss for the year then
ended;
-- have been properly prepared in accordance with International
Financial Reporting Standards as adopted by the European Union;
-- have been prepared in accordance with the requirements of the Companies Act 2006.
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.
Material Uncertainty related to going concern
We draw attention to note 2.5 in the financial statements which
details the factors the Company has considered when assessing the
going concern position. As explained in note 2.5 the Directors
accept that there is a material uncertainty in respect of going
concern should they be unable to raise the funds to complete the
proposed acquisition of CARU. Should this uncertainty not be
resolved this cast significant doubt on the Company's ability to
continue as a going concern. Our opinion is not modified in this
respect.
Emphasis of matter
In the event that the proposed acquisition does not take place
there is an uncertainty over the ability of the Company to recover
the loan due from CARU as disclosed in note 8 [and note 3a]. CARU
has limited financial assets with which to repay the loan and the
Company may need to recognise an impairment provision in this
circumstance. Given that the completion of the transaction is
uncertain, as described above, this constitutes a material
uncertainty. Our opinion is not modified in this respect.
Conclusions relating to principal risks, going concern and
viability statement
Aside from the impact of the matters disclosed in the material
uncertainty related to going concern section, we have nothing to
report in respect of the following information in the annual
report, in relation to which the ISAs (UK) require us to report to
you whether we have anything material to add or draw attention
to:
-- the disclosures in the annual report ,noted above, that
describe the principal risks and explain how they are being managed
or mitigated;
-- the directors' confirmation, noted above, in the annual
report that they have carried out a robust assessment of the
principal risks facing the company, including those that would
threaten its business model, future performance, solvency or
liquidity;
-- whether the directors' statements relating to going concern
and their assessment of the prospects of the company required under
the Listing Rules in accordance with Listing Rule 9.8.6R(3) is
materially inconsistent with our knowledge obtained in the audit;
or
the directors' explanation ,noted above, in the annual report as
to how they have assessed the prospects of the company, over what
period they have done so and why they consider that period to be
appropriate, and their statement as to whether they have a
reasonable expectation that the company will be able to continue in
operation and meet its liabilities as they fall due over the period
of their assessment, including any related disclosures drawing
attention to any necessary qualifications or assumptions.
Overview of our audit approach
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 to evaluate the impact of misstatements
identified.
Based on our professional judgement, we determined overall
materiality for the financial statements as a whole to be GBP8,600
(FY18 GBP8,000), based on a percentage of net assets.
We use a different level of materiality ('performance
materiality') to determine the extent of our testing for the audit
of the financial statements. Performance materiality is set based
on the audit materiality as adjusted for the judgements made as to
the entity risk and our evaluation of the specific risk of each
audit area having regard to the internal control environment.
Where considered appropriate performance materiality may be
reduced to a lower level, such as, for related party transactions
and directors' remuneration.
We agreed with the Board of Directors to report to it all
identified errors in excess of GBP430 (2018: GBP400). Errors below
that threshold would also be reported to it if, in our opinion as
auditor, disclosure was required on qualitative grounds.
Overview of the scope of our audit
The Company is accounted for from one central operating
location, the Company's registered office. Our audit was conducted
from our offices and all the Company records were within the scope
of our audit testing.
Extent to which the audit is capable of detecting
irregularities, including fraud
We design our procedures so as to obtain sufficient appropriate
audit evidence that the financial statements are not materially
misstated due to non-compliance with laws and regulations or due to
fraud or error.
We are not responsible for preventing non-compliance and cannot
be expected to detect non-compliance with all laws and regulations
- this responsibility lies with management.
Based on our understanding of the Company and industry,
discussions with management we identified financial reporting
standards, and Companies Act 2006 as having a direct effect on the
amounts and disclosures in the financial statements.
Other laws and regulations where non-compliance may have a
material effect on the Company's operations are the laws and
regulations associated with the listing on the London Stock
Exchange.
As part of the engagement team discussion about how and where
the Company's financial statements may be materially misstated due
to fraud, we did not identify an areas with an increased risk of
fraud.
Our audit procedures included:
-- enquiry of management about the Company's policies,
procedures and related controls regarding compliance with laws and
regulations and if there are any known instances of
non-compliance;
-- examining supporting documents for all material balances, transactions and disclosures;
-- review of the Board of directors minutes;
-- enquiry of management about litigations and claims and
inspection of relevant correspondence
-- evaluation of the selection and application of accounting
policies related to subjective measurements and complex
transactions;
-- analytical procedures to identify any unusual or unexpected relationships;
-- testing the appropriateness of journal entries recorded in
the general ledger and other adjustments made in the preparation of
the financial statements;
-- review of accounting estimates for biases;
Owing to the inherent limitations of an audit, there is an
unavoidable risk that some material misstatements of the financial
statements may not be detected, even though the audit is properly
planned and performed in accordance with the ISAs (UK).
The potential effects of inherent limitations are particularly
significant in the case of misstatement resulting from fraud
because fraud may involve sophisticated and carefully organized
schemes designed to conceal it, including deliberate failure to
record transactions, collusion or intentional misrepresentations
being made to us.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgement, 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) that we identified. These matters included 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.
Except for the matter described in the material uncertainty
related to going concern section, we have determined that there are
no other key audit matters to be communicated in our report.
This is not a complete list of all risks identified by our
audit.
Other information
The directors are responsible for the other information. The
other information comprises the information included in the annual
report, other than the financial statements and our auditor's
report thereon. 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.
In this context, we also have nothing to report in regard to our
responsibility to specifically address the following items in the
other information and to report as uncorrected material
misstatements of the other information where we conclude that those
items meet the following conditions:
-- Fair, balanced and understandable - the statement given the
directors that they consider the annual report and financial
statements taken as a whole is fair, balanced and understandable
and provides the information necessary for shareholders to assess
the company's performance, business model and strategy, is
materially inconsistent with our knowledge obtained in the audit;
or
-- Audit committee reporting - the explanation as to why the
annual report does not include a section describing the work of the
audit committee is materially inconsistent with our knowledge
obtained in the audit; or
-- Directors' statement of compliance with the UK Corporate
Governance Code - the parts of the directors' statement required
under the Listing Rules relating to the company's compliance with
the UK Corporate Governance Code containing provisions specified
for review by the auditor in accordance with Listing Rule
9.8.10R(2) do not properly disclose a departure from a relevant
provision of the UK Corporate Governance Code.
Opinions on other matters prescribed by the Companies Act
2006
In our opinion the part of the directors' remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion based on the work undertaken in the course of our
audit
-- the information given in the strategic report and the
directors' report for the financial year for which the financial
statements are prepared is consistent with the financial
statements; and
-- the directors' report and strategic report have been prepared
in accordance with applicable legal requirements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
-- adequate accounting records have not been kept by the
company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the financial statements and the part of the directors'
remuneration report to be audited 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
Responsibilities of the directors for the financial
statements
As explained more fully in the directors' responsibilities
statement noted above, 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.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the Board of Directors on 14 December 2018
to audit the financial statements for the period ending 30
September 2018. Our total uninterrupted period of engagement is 2
years, covering the periods ending 30 September 2018 to 30
September 2019.
The non-audit services prohibited by the FRC's Ethical Standard
were not provided to the company and we remain independent of the
company in conducting our audit.
Our audit opinion is consistent with the additional report to
the audit committee.
Use of our report
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them 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 opinions we have
formed.
Matthew Stallabrass
Senior Statutory Auditor
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
St Bride's House
10 Salisbury Square
London
EC4Y 8EH
30 January 2020
Statement of Comprehensive Income
for the year ended 30 September 2019
12 months to 13 months to
30 Sep 2019 30 Sep 2018
Restated
Notes GBP
Administrative fees and other expenses 4 (243,119) (163,520)
------------------------------------------------------------- ------ ------------- -------------
Operating loss (243,119) (163,520)
Finance costs - -
------------------------------------------------------------- ------ ------------- -------------
Loss before tax (243,119) (163,520)
Income tax - -
Loss for the year and total comprehensive loss for the year (243,119) (163,520)
------------------------------------------------------------- ------ ------------- -------------
Basic and diluted loss per share (pence) 7 (0.93) (1.28)
There was no other comprehensive income for the year ended on 30
September 2019.
The accompanying notes below form an integral part of the
Financial Statements .
Statement of Financial Position as at 30 September 2019
Notes 30 Sep 2019 30 Sep 2018
Restated
GBP GBP
Current assets
Trade and other receivables 8 256,854 -
Cash and cash equivalents 141,992 278,089
Total current assets 398,846 278,089
Current liabilities
Creditors: Amounts falling due within one year 9 111,724 36,103
------------------------------------------------ ------ ------------ ------------
Total current liabilities 111,724 36,103
Net assets 287,122 241,986
------------------------------------------------ ------ ------------ ------------
Equity
Share capital 10 450,000 400,000
Share premium 10 209,983 -
Warrants reserve 11 33,778 5,506
Retained earnings (406,639) (163,520)
------------------------------------------------ ------ ------------ ------------
Total equity 287,122 241,986
------------------------------------------------ ------ ------------ ------------
The accompanying notes below form an integral part of the
Financial Statements .
The Financial Statements were approved and authorised for issue
by the Board of Directors on 29 December 2020 and were signed on
its behalf by:
Cameron Pearce Sam Quinn
Director Director
Statement of Changes in Equity for the year ended 30 September
2019
Share Share premium Warrant reserves
capital Retained earnings Total equity
GBP GBP GBP GBP GBP
Balance as at 18 Sep 2017 on
incorporation 1 - - 1
Loss for the period - - - (144,014) (144,014)
Adjustment (note 2.6) (19,506) (19,506)
------------------------------------- --------- -------------- ----------------- ------------------ -------------
Total comprehensive loss - - - (163,520) (163,520)
Contributions from equity holders
New shares issued (note 10) 399,999 - - - 399,999
Issue of warrants 5,506 5,506
Total contributions from equity
holders 399,999 - 5,506 - 405,505
Balance as at 30 Sep 2018 400,000 - 5,506 (163,520) 241,986
------------------------------------- --------- -------------- ----------------- ------------------ -------------
Loss for the year - - - (243,119) (243,119)
------------------------------------- --------- -------------- ----------------- ------------------ -------------
Total comprehensive loss - - - (243,119) (243,119)
Contributions from equity holders
New shares issued (note 10) 50,000 350,000 - 400,000
Share issue costs - (140,017) - (140,017)
Issue of warrants 28,272 - 28,272
Total contributions from equity
holders 50,000 209,983 28,272 - 288,255
Balance as at 30 Sep 2019 450,000 209,983 33,778 (406,639) 287,122
------------------------------------- --------- -------------- ----------------- ------------------ -------------
The accompanying notes below form an integral part of the
Financial Statements .
Statement of Cash Flows for the year ended 30 September 2019
12 months to 13 months to
Notes 30 Sep 2019 30 Sep 2018
Restated
GBP GBP
Operating activities
Loss after tax (243,119) (163,520)
Share issue/warrant cost 28,272 5,506
Changes in working capital
Increase in trade and other receivables 8 (256,853) -
Increase in trade and other payables 9 75,620 36,103
-------------------------------------------------------- ------ ------------- -------------
Net cash flows from operating activities (396,080) (121,911)
Cash flows from financing activities
Shares issued 10 400,000 400,000
Shares issued 10 (140,017) -
-------------------------------------------------------- ------ ------------- -------------
Net cash flows from financing activities 259,983 400,000
(Decrease)/increase in cash and cash equivalent (136,097) 278,089
Cash and cash equivalents at the beginning of the year 278,089 -
Cash and cash equivalents at 30 September 141,992 278,089
-------------------------------------------------------- ------ ------------- -------------
The accompanying notes below form an integral part of the
Financial Statements .
Notes to the Financial Statements for the year ended 30
September 2019
1. General
Blencowe Resources Plc (the "Company") is a public limited
company incorporated and registered in England and Wales on 18
September 2017 (as Cora Gold Limited, the name was changed to
Blencowe Resources Limited on the 26 September 2017 and to Blencowe
Resources plc on 13 July 2018) with registered company number
10966847 and its registered office situated in England and Wales
with its registered office at 25 Bilton Road, Rugby, CV22 7AG.
The Company did not trade during the year under review.
2. Accounting Policies
2.1 Basis of preparation
The principal accounting policies applied in the preparation of
the Company's Financial Statements are set out below. These
policies have been consistently applied to the period presented,
unless otherwise stated.
The Company's Financial Statements have been prepared in
accordance with IFRS as adopted by EU for. The Company Financial
Statements have been prepared using the measurement bases specified
by IFRS each type of asset, liability, income and expense.
The Company Financial Statements are presented in GBP, which is
the Company's functional currency. All amount have been rounded to
the nearest pound, unless otherwise stated.
2.2 Changes in significant accounting policies
IFRS 9 Financial Instruments replaced IAS 39 Financial
Instruments: Recognition and Measurement for annual periods
beginning on or after 1 January 2018, bringing together all three
aspects of the accounting for financial instruments: classification
and measurement; impairment; and hedge accounting.
The Company has applied IFRS 9 retrospectively and determined
that there was no material impact on the comparative balances other
than a change in classification and terminology. There was no
impact on hedging as the Company does not apply hedge
accounting.
Additionally, the Company has adopted consequential amendments
to IFRS 7 Financial Instruments: Disclosures, which are applied to
disclosures about 2018 but have not generally been applied to
comparative information.
2.3 Future changes in accounting policies
At the date of authorisation of these Financial Statements, the
Directors have reviewed the Standards in issue by the International
Accounting Standards Board ("IASB") and IFRIC, which are effective
for annual accounting periods ending on or after the stated
effective date. In their view, none of these standards would have a
material impact on the financial reporting of the Company.
The Directors do not expect that the adoption of these standards
will have a material impact on the Financial Statements of the
company.
2.4 Financial instruments
A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another.
(i) Financial assets
Financial assets are classified at initial recognition. The
classification of financial assets at initial recognition that are
debt instruments depends on the financial asset's contractual cash
flow characteristics and the Company's business model for managing
them. The Company initially measures a financial asset at its fair
value plus, in the case of a financial asset not at fair value
through profit or loss, transaction costs.
(i) Financial assets (continued)
In order for a financial asset to be classified and measured at
amortised cost, it needs to give rise to cash flows that are
'solely payments of principal and interest (SPPI)' on the principal
amount outstanding. This assessment is referred to as the SPPI test
and is performed at an instrument level.
Classification and measurement is based on both whether
contractual cash flows are solely payments of principal and
interest; and whether the debt instrument is held to collect those
Cashflows. In the case of the Company, all financial assets meet
this criteria and so there are held to at amortised cost.
Impairment of financial assets
IFRS 9's impairment requirements use more forward-looking
information to recognise expected credit losses - the ECL model.
This replaces IAS 39's 'incurred loss model'.
ECLs are based on the difference between the contractual cash
flows due in accordance with the contract and all the cash flows
that the Company expects to receive, discounted at the original
effective interest rate. The expected cash flows will include cash
flows from the sale of collateral held or other credit enhancements
that are integral to the contractual terms.
ECLs are recognised in two stages. For credit exposures for
which there has not been a significant increase in credit risk
since initial recognition, ECLs are provided for credit losses that
result from default events that are possible within the next 12
months (a '12-month ECL'). For those credit exposures for which
there has been a significant increase in credit risk since initial
recognition, a loss allowance is required for credit losses
expected over the remaining life of the exposure, irrespective of
the timing of the default (a 'lifetime ECL').
For trade receivables and contract assets, the Company applies a
simplified approach in calculating ECLs. Therefore, the Company
does not track changes in credit risk, but instead recognises a
loss allowance based on lifetime ECLs at each reporting date.
It is the Company's policy to measure ECLs on such instruments
on a 12-month basis.
(ii) Financial liabilities
Financial liabilities are classified, at initial recognition, as
financial liabilities at amortised cost. The Company's financial
liabilities include trade and other payables and loans.
Subsequent measurements
Loans and borrowings and trade and other payables.
After initial recognition, interest-bearing loans and borrowings
and trade and other payables are subsequently measured at amortised
cost using the EIR method. Gains and losses are recognised in the
statement of profit or loss and other comprehensive income when the
liabilities are derecognised, as well as through the EIR
amortisation process.
Amortised cost is calculated by taking into account any discount
or premium on acquisition and fees or costs that are an integral
part of the EIR. The EIR amortisation is included as finance costs
in the statement of profit or loss and other comprehensive
income.
This category generally applies to trade and other payables.
Derecognition
A financial liability is derecognised when the associated
obligation is discharged or cancelled or expires.
When an existing financial liability is replaced by another from
the same lender on substantially different terms, or the terms of
an existing liability are substantially modified, such an exchange
or modification is treated as the derecognition of the original
liability and the recognition of a new liability. The difference in
the respective carrying amounts is recognised in profit or loss and
other comprehensive income.
2.5 Going concern
The Company's business activities, together with the factors
likely to affect its future development, performance and positions
are set out in the Chairman's Statement noted above.
The Company is an investment company, and currently has no
income stream until a suitable acquisition is identified, it is
therefore dependent on its cash reserves to fund ongoing costs.
The Directors have reviewed the Company's ongoing activities
including its future intentions in respect of acquisitions and
having regard to the Company's existing working capital position
and its ability to potentially raise finance, if required, the
Directors are of the opinion that the Company has adequate
resources to enable it to continue in existence for a period of at
least 12 months from the date of these Financial Statements .
The Company review its going concern status and the board have
identified that further funding will be required to finance the
future of the Company and the acquisition of CARU. At present the
Company is in the process of raising GBP2,000,000 further funding
which will contribute to the acquisition of CARU. Without this
funding, which is not guaranteed, the Company will not be able to
complete the acquisition and may not have the funds to continue to
finance its ongoing operations, consequently there is a material
uncertainty in respect of going concern
2.6 Comparative figures
The comparative figures have been presented as the Company
Financial Statements cover the period from incorporation on 18
September 2017 to September 2018.
It was noted that in the 2018 period, directors fees of
GBP14,000 and warrant cost of GBP5,506 were not accrued for.
Therefore, the 2018 figures have been restated to show its correct
allocation of costs and a corresponding reduction in total equity.
The basic and diluted loss per share for the period ended in 2018
has increased from 1.13p to 1.28p.
13 months to 13 months to
30 Sep 2018 30 Sep 2018
post adjustment pre adjustment
Earnings
Loss from continuing operations
for the year attributable to
the equity holders of the Company (GBP163,520) (GBP144,014)
Number of shares
Weighted average number of Ordinary
Shares for the purpose of basic
and diluted earnings per share 12,720,424 12,720,424
------------------------------------- ----------------- ----------------
Basic and diluted loss per share
(pence) (1.28) (1.13)
------------------------------------- ----------------- ----------------
2.7 Cash and cash equivalents
The Directors consider any cash on short-term deposits and other
short-term investments to be cash equivalents.
2.8 Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from proceeds.
Warrants
Warrant options are classified as equity. The fair value of the
warrants has been calculated using the Black-Scholes option pricing
model. For more information please see note 11.
2.9 Foreign currency
Transactions in foreign currencies are translated to the
functional currency at the exchange rates ruling at the dates of
the transactions. Monetary assets and liabilities denominated in
foreign currencies at the reporting date are retranslated to the
functional currency at the exchange rate at that date. Exchange
differences arising on translation are recognised in profit or
loss.
2.10 Earnings per share
The Company presents basic and diluted earnings per share
("EPS") data for its Ordinary Shares. Basic EPS is calculated by
dividing the profit or loss attributable to ordinary shareholders
of the Company by the weighted average number of Ordinary Shares
outstanding during the year. Diluted EPS is calculated by adjusting
the earnings and number of shares for the effects of dilutive
potential Ordinary Shares.
2.11 Income tax
Income tax expense comprises current tax and deferred tax.
Current income tax
Being resident in England and Wales, a 19% rate of corporate
income tax applies to the Company.
Deferred income tax
Deferred tax is recognised in profit or loss except to the
extent that it relates to a business combination, or items
recognised directly in equity or in other comprehensive income.
Deferred income tax is recognised on temporary differences arising
between the tax bases of assets and liabilities and their carrying
amounts in the Financial Statements. Deferred income tax assets and
liabilities are measured on an undiscounted basis at the tax rates
that are expected to apply to the period when the related asset is
realised or the liability is settled, based on tax rates (and tax
laws) that have been enacted or substantively enacted at the date
of the Statement of Financial Position.
2.12 Cash and cash equivalents
Cash and cash equivalents in the statement of financial position
comprise cash at bank balances only. For the purpose of the
statement of cash flows, cash and cash equivalents consist of bank
balances only.
3. Critical accounting estimates and judgments
In preparing the Company Financial Statements, the Directors
have to make judgments on how to apply the Company's accounting
policies and make estimates about the future. The Directors do not
consider there to be any critical judgments that have been made in
arriving at the amounts recognised in the Company Financial
Statements.
a) Recovery of trade receivables
Following the Company's adoption of IFRS 9, it is estimated that
5% of the Company's loan with CARU might not be recoverable. If
this estimate was to change by 2%, the Company's recoverable loan
would increase by GBP4,000. If the Transaction (see Strategic
Report) does not take place, the Company may not be able to recover
any receivable.
b) Warrant
During the year the Company issued its shareholders with
warrants. The valuation of these warrants involved making a number
of critical estimates relating the price volatility, expected life
if the options and interest rated. These assumptions are described
in more details in note 11.
The expenses charged to the Statement of Comprehensive Income
during the year in relation to warrants was GBP28,272 (2018:
GBP5,506).
c) Going concern
The Company review its going concern status and the board have
identified that further funding will be required to finance the
future of the Company and the acquisition of CARU.
At present the Company is in the process of raising GBP2,000,000
further funding which will contribute to the acquisition of CARU
(see note 2.5).
4. Administrative fee and other expenses
12 months to 13 months to
30 Sep 2019 30 Sep 2018
Restated
GBP GBP
Directors' remuneration (see
note 5) 75,077 58,286
Professional fees 54,203 24,044
Listing fees 19,552 -
Audit fees 19,200 6,600
Share issue/warrant cost (see
note 11) 28,272 43,644
Project costs 12,211 -
Provisions 11,172 -
Administration fees 8,159 9,000
Broker fees 5,000 -
Travelling expenses 4,685 20,339
Miscellaneous fees 5,588 1,607
Total 243,119 163,520
------------------------------- ------------- -------------
The company did not employ any staff during the year other than
Directors. The Directors are the only members of key management and
their remuneration related solely to short term employee
benefits.
5. Directors' remuneration
12 months to 13 months to
30 Sep 2019 30 Sep 2018
Restated
GBP GBP
Directors fees 70,000 56,000
Employer NI 3,697 716
Director expenses 1,380 1,570
------------------- ------------- -------------
Total 75,077 58,286
------------------- ------------- -------------
On addition, the Directors received warrants which are disclosed
on note 11. The total value of warrants allocated to the Directors
during the year is GBP11,228 (2018: GBP2,922)
6. Taxation
Analysis of charge in the year
12 months to 13 months to
30 Sep 2019 30 Sep 2018
GBP GBP
Current tax:
UK Corporation tax on loss for - -
the year
Deferred tax - -
Tax on loss on ordinary activities - -
12 months to 13 months to
30 Sep 2019 30 Sep 2018
GBP GBP
Loss on ordinary activities before
tax (243,119) (163,520)
Analysis of charge in the year
Loss on ordinary activities multiplied
by rate of corporation tax in
the UK of 19% (2018: 19%) (46,193) (31,069)
Tax losses carried forward (46,193) (31,069)
Current tax charged - -
Effects of:
Loss brought forward (163,250) -
Loss on year (243,119) (163,250)
---------------------------------------- ------------- -------------
Loss carried forward (406,639) (163,250)
---------------------------------------- ------------- -------------
Current tax charge for the year
as above - -
The Company has accumulated tax losses arising in the UK of
(GBP406,639) that are available, under current legislation, to be
carried forward against future profits. No deferred tax asset has
been recognised in respect to these losses due to the uncertainty
of the future trading profits.
7. Loss per share
The calculation of the basic and diluted loss per share is based
on the following data:
13 months to
30 Sep 2019 30 Sep 2018
Restated
Earnings
Loss from continuing operations for the year attributable to the equity holders of the (GBP243,119) (GBP162,520)
Company
Number of shares
Weighted average number of Ordinary Shares for the purpose of basic and diluted
earnings per
share 26,187,212 12,720,424
---------------------------------------------------------------------------------------- ------------- -------------
Basic and diluted loss per share (pence) (0.93) (1.28)
---------------------------------------------------------------------------------------- ------------- -------------
There are no potentially dilutive shares in issue.
8. Trade and other receivables
30 Sep 2019 30 Sep 2018
GBP GBP
Loan to CARU 223,431 -
Other receivables 37,495 -
Prepayments 7,100 -
------------------ ------------ ------------
268,026 -
------------------ ------------ ------------
Less: provision (11,172) -
------------------ ------------ ------------
Total 256,854 -
------------------ ------------ ------------
During the year, the Company agreed to cover some expenses for
Consolidated African Resources (Uganda) Ltd ("CARU") (see note 14)
for the value of GBP223,431. Following the Company's adoption of
IFRS 9, a provision of GBP11,172 has been made against this
loan.
9. Creditors: Amounts falling due within one year
30 Sep 2019 30 Sep 2018
GBP GBP
restated
Other payables 91,724 15,503
Accruals and provisions 20,000 20,600
Total 111,724 36,103
------------------------- ------------ ------------
10. Stated capital
Number of Nominal value Share capital Share Total share
shares issued per share Premium capital
GBP GBP GBP GBP
On incorporation - - - - -
Issue of ordinary
shares 1 10,000,000 0.005 50,000 - 50,000
Issue of ordinary
shares 2 11,666,664 0.03 350,000 - 350,000
At 30 Sep
2018 21,666,664 400,000 - 400,000
------------------- --------------- -------------- -------------- ---------- ------------
Issue of Ordinary
shares 3 10,000,000 0.005 50,000 350,000 400,000
Share issued
costs - (140,017) (140,017)
At 30 Sep
2019 31,666,664 450,000 209,983 659,983
------------------- --------------- -------------- -------------- ---------- ------------
The Company was incorporated on 18 September 2017. On
incorporation, one Ordinary Share was issued at the par value of
GBP1.
On 13 November 2017, the Company changed the share structure
from one Ordinary Share of nominal value GBP1 to 200 Ordinary
Shares of nominal value GBP0.005 and issued a further 9,999,800
Ordinary Shares at GBP0.005 each, to take the total number of
Ordinary Shares to 10,000,000 with a nominal value of
GBP50,000.
On 18 September 2018, the Company issued a further 11,666,664
Ordinary Shares at GBP0.03 each, to take the total number of
Ordinary Shares to 21,666,664 with an aggregate nominal value of
GBP400,000.
On 18 April 2019, the Company issued a further 8,500,000
Ordinary Shares of 0.5p each were issued at a price of 4 pence per
share, to raise GBP340,000 before costs, or GBP260,000 after costs.
In addition, a further 1,500,000 Ordinary Shares were issued in
settlement of GBP60,000 of costs incurred under two Facilitation
Agreements with third party service providers.
All of the shares issued, with different nominal values, are
classed as ordinary and have similar rights attached to them.
The Directors are authorised to issue 100,000,000 ordinary
shares. As at 30 September 2019 the number of shares issued and
fully paid were 31,666,664 (2018: 21,666,664).
11. Warrants
The following warrants were issued as part of the shares
subscriptions:
Number issued Expiry
Warrants - 27 June 2018 10,833,336 4 years
Warrants - 31 August 2019 3,625,000 4 years
Total warrants 14,458,336
--------------------------- -------------- --------
The total expense recognised in the Statement of Comprehensive
Income during the year was GBP14,959 (2018: GBPNil). The fair value
has been calculated using the Black-Scholes option pricing model.
The inputs into the model were as follows:
27 June 2018 31 August 2019
Warrants Warrants
Number of warrants issued 10,833,336 3,625,000
Share price 3.0p 4.5p
Exercise price 4.0p 6.0p
Expected volatility 51% 51%
Expected live (yrs.) 4 4
Risk free interest rate 0.82% 0.48%
Dividend yield Nil Nil
Expected volatility was based on an average of similar entities
volatility percentages.
The total share based payment recognised in the Statement of
Changes in Equity during the year was GBP28,272 (2018:
GBP5,506).
12. Financial instruments
12.1 Categories of financial instruments
30 Sep 2019 30 Sep 2018
GBP GBP
Financial assets at amortised cost
Trade and other receivables 249,754 -
Cash and cash equivalents 141,992 278,089
Financial liabilities at amortised
cost
Trade and other payables 111,724 36,103
12.2 Financial risk management objectives and policies
The Company's major financial instruments include bank balances,
trade and other payables and accrued expense. Details of these
financial instruments are disclosed in respective notes. The risks
associated with these financial instruments, and the policies on
how to mitigate these risks are set out below. The management
manages and monitors these exposures to ensure appropriate measures
are implemented on a timely and effective manner.
Currency risk
As all monetary assets and liabilities and all transaction of
Company are denominated in its functional currency, the director
considers the Company is not exposed to significant foreign
currency risk.
Credit risk
Credit risk arises on investments, cash balances and debtor
balances, The amount of credit risk is equal to the amounts stated
in the statements of financial position for each of the assets
(note 8).
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient
cash and marketable securities, the availability of funding through
an adequate amount of committed credit facilities and the ability
to close out market positions. The Company aims to maintain
flexibility in funding.
The maturity of the Company's financial liabilities at the
statement of financial position date, based on the contracted
undiscounted payments as disclosed in note 8, falls within one year
and payable on demand.
Capital risk
The Company defines capital as the total equity of the Company.
The Company's objectives when managing capital are to safeguard the
Company's ability to continue as a going concern in order to
provide returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure to reduce
the cost of capital.
13. Related party transactions
The are no related party transactions during the year except for
the Directors' remuneration, which has been disclosed in note
5.
14. Events after the reporting date
On 28 October 2019, the Company signed a Share Purchase
Agreement for the proposed acquisition by the Company of 100% of
the share capital of CARU, by way of a reverse takeover.
The Company will, subject to a successful placing, acquire the
entire share capital of CARU with the total aggregate consideration
payable by the Company being GBP2,000,000 and AUD$50,000 in cash,
to be satisfied in full by the issue of 33,333,333 new Ordinary
Shares at an implied price of GBP0.06 per share.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR KKKBQQBKDCDN
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