TIDMRGM
RNS Number : 2477R
Regency Mines PLC
07 December 2016
Regency Mines PLC
("Regency" or the "Company")
Final Audited Results for the Year Ended 30 June 2016
07 December 2016
A copy of the Company's annual report and financial statements
for 2016 - extracts from which are set out below - will be made
available on the Company's website www.regency-mines.com shortly
and at the Annual General Meeting to be held on 30 December
2016.
Chairman's Review
Dear Shareholders,
Overview
We all live with paradox to some degree, for to live with
consistency is far more difficult. Early stage resource companies
live with a paradox that is particularly acute. It is this: they
all know that mineral exploration takes time, and that bringing
resources into production takes more time, but the investors who
buy and sell their shares every day are a subset of investors who,
while they may have a higher than usual tolerance of risk, often
ally that with an appetite for volatility and quick returns. This
is not always irrational: however great the opportunity, the long
term uncertainties may need to be balanced by the prospect of short
term gain.
Investors who have followed the resource sector over the five or
so years to early 2016 will have seen few if any gains, and will
have learnt some painful lessons about just how volatile the sector
can be. They have learnt mistrust, which can be a hard lesson to
unlearn. The reverse has been so severe, particularly in the final
stages from 2015 to early 2016, that even some of the great
companies of the mining sector, usually protected by strong cash
flows, were brought to their knees. And it was this fact, the
greatest confidence-destroyer, that showed recovery was round the
corner. For if the price and volume leaders in a commodity cannot
make profits, then volume falls and price rises must occur until
they can.
So we now have a sector seeing price recovery, and perhaps some
growth. Some of the hard lessons of the last five years have to be
unlearnt if we are to seize the moment, although without repeating
the mistakes of the five years before that.
Regency has one of the world's largest lateritic nickel and
cobalt resources, which it developed itself, and perhaps the
world's largest tantalum resource, but these are exploration
projects, and Regency produces nothing. The long-term opportunities
are great, and capital value crystallisation may occur at any time
if there is a sufficiently large increase in price levels, such as
has been seen this year in other commodities such as manganese and
coal, but the timing of such an increase is necessarily
unpredictable. Therefore the uncertainties are also great. The
Company concluded some time ago that it was especially necessary
given this profile to add cash-flow generation possibilities to
balance the long-term character of the existing asset
portfolio.
The logical place to seek such possibilities was the oil and gas
sector. This was for three reasons. First, there are established
procedures and legal structures for taking shared and partial
direct interests, such as wellbore interests, whether in individual
wells or strata or in larger projects, enabling us to participate
in projects with critical mass while matching our participation
level with our financial capabilities and risk appetite. Secondly,
exploration success can lead to immediate cash flow. Thirdly, we
had been expecting the oil price to fall and expected it to fall
further, so we were mentally prepared and believed it would be
possible to find attractively priced opportunities, including
assets coming out of insolvency.
But finding good projects is not easy. We participated in the
early drilling at Horse Hill in the Weald Basin, and reinvested in
early 2016 when testing began and began to produce unexpectedly
strong results from the Kimmeridge limestones.
Many projects were considered, and we entered at various points
over the last two years into preliminary and co-operation
agreements with three groups in the U.S. in relation to both the
search for opportunities and specific opportunities. These,
including the oil project tender in Wyoming, are not now being
progressed. We have made clear that as we were looking for
exceptional investments including insolvency situations while the
sector was depressed we could not expect to consummate transactions
in every case, expected failures in what would be competitive
situations, and even one successful outcome might be
transformative. We have since concluded one such successful
transaction, and are progressing another, both with new
partners.
In May 2016 we identified, and invested GBP175,000 in, Westport
Energy plc, a company that was to acquire and has now acquired out
of an insolvency coal bed methane assets in Oregon including five
drilled wells ready for completion. That company, now named Curzon
Energy plc is seeking listing in London and post-listing and a
further investment we expect to hold some 10% with a seat on the
board.
Straddling the energy and the mineral sectors is a commodity
that, like oil and gas, has seen significant price recovery this
year: coal. We identified Carbon Minerals Corporation, a project
for metallurgical coal contour mining in Alabama that shares two
characteristics with some of the oil projects we have been
reviewing, in that it offers the prospect of immediate cash flow,
and has recently been purchased out of a financial restructuring.
We have post the balance sheet date agreed to take a participation
in Carbon Minerals Corporation and paid a GBP50,000 deposit with
GBP200,000 due subject to our confirmation of information.
With both these projects we are looking for returns out of
proportion to their cost, and both of them could scale up
relatively rapidly. The coal project has as its immediate objective
that it should quickly start to throw off cash to the participants.
This is important to us: after cutting costs during the year, we
now focus on projects which could provide us with significant
revenues and cash flow.
Discussion of the Results
Losses reported for the year to 30 June 2016 fell from
GBP5,888,742 to GBP1,965,722. The continuing significant level of
losses came as a result principally of further provisions made
against the value of our assets. Impairment of available for sale
financial assets of GBP547,068 reflected a further write-down in
our stake in Direct Nickel Ltd, owners of a proprietary processing
technology, from GBP762,439 to GBP215,375, and a decision has been
made to expense our expenditure on Sudan exploration, which we
shall not continue, resulting in a GBP658,281 charge to Exploration
expenses.
Our efforts to cut costs were a priority during the period, and
the most significant element of this was a strategic decision to
close down our geology and accounting functions and outsource the
work. Although the full effects of this were felt for less than
half a year, we can report that Administrative expenses were
reduced from GBP964,761 to GBP594,732.
We saw the departure during the year of two valued colleagues on
the board who had been with the Company since Listing, John Watkins
and Julian Lee, and are grateful for their assistance over many
years. We also, as a result of the restructuring at the end of
2015, said goodbye to many members of staff, and record our thanks
for their capable and loyal service.
Regency disposed of its remaining holdings in Alba Mineral
Resources plc and Ram Resources Ltd during the year, for proceeds
of GBP91,878 and AUD188,008.66 respectively.
Prospects
The Company looks forward to the possible IPO of Curzon Energy
plc which we understand is targeted for early 2017. The same period
is expected to see the grant of planning permission for the next
phase of testing and exploration at Horse Hill, while Angus Energy
is seeking permission for a side-track to assess potential at its
neighbouring license at Brockham. Carbon Minerals Corporation also
hopes, provided we complete our investment, to start coal
production in the first quarter of 2017.
2017 should therefore start as an active year, and we hope it
will continue as one.
Our major legacy assets at Mambare, our nickel-cobalt project in
Papua New Guinea, and Motzfeldt, our Tantalum-Niobium resource in
southern Greenland, are on present assumptions likely to see
limited activity on the ground during the year. Should base metal
prices such as Nickel continue to strengthen, and improve
significantly, or that of Tantalum recover, more scope for joint
venture exploration (and, indeed corporate activity) will exist as
attention will once more focus on the underlying value of these
assets. At some point in the recovery we believe this is likely to
happen, whether it is in 2017 or 2018, so although we continue to
pursue potential options for partnership or sale we do not feel
under any pressure to bring these to an early conclusion.
Overall, Regency has begun to redefine its identity and from a
low base has assembled a group of assets any of which have the
capacity to transform the value of the Company. It remains highly
entrepreneurial, and open to opportunities, whether within or
outside the existing project portfolio.
At Curzon Energy we have an interest in a company where the
initial phase will be followed up by ambitious plans to drill up to
200 wells in stages over 47,000 acres. At Carbon Minerals we expect
to have an interest in a project that aims for over 100,000 tons
coal production in its first year with ambitions for up to 3
million tons in its second. Ambitions are not the same as plans,
and are not always fulfilled, but, in a market where capital values
have been so depressed, to take a project with mineral potential
but without high ambition would have an opportunity cost.
We hope for your continued support, and look forward to soon
rewarding you with the progress we are anticipating in the
remainder of this financial year towards our objective of building
a secure base of revenues and profit.
Results and dividends
Regency Mines (the "Parent") and its subsidiaries made a
post-tax loss of GBP1,965,722 (2015: GBP5,888,742). The Directors
do not recommend the payment of a dividend. The following financial
statements are extracted from the audited financial statements
which were approved by the Board of Directors and authorised for
issue on 06 December 2016.
For further information, please contact:
Andrew Bell 0207 747 9960 Chairman Regency Mines Plc
Scott Kaintz 0207 747 9960 Executive Director Regency Mines
Plc
Roland Cornish/Rosalind Hill Abrahams 0207 628 3396 NOMAD Beaumont Cornish Limited
Jason Robertson 0129 351 7744 Broker Dowgate Capital
Stockbrokers Ltd.
Consolidated statement of financial position
as at 30 June 2016
30 June 30 June
2016 2015
Notes GBP GBP
------------------------------------ ----- ------------ ------------
ASSETS
Non-current assets
Property, plant and equipment 9 21,716 8,828
Investments in associates and joint
ventures 11 1,638,113 1,660,854
Available for sale financial assets 12 1,147,460 995,011
Exploration assets 13 233,900 829,151
Trade and other receivables 14 1,202,312 1,195,907
Total non-current assets 4,243,501 4,689,751
------------------------------------ ----- ------------ ------------
Current assets
Cash and cash equivalents 20 7,960 3,565
Trade and other receivables 14 344,815 634,776
------------------------------------ ----- ------------ ------------
Total current assets 352,775 638,341
------------------------------------ ----- ------------ ------------
Total assets 4,596,276 5,328,092
------------------------------------ ----- ------------ ------------
EQUITY AND LIABILITIES
Equity attributable to owners of
the Parent
Called up share capital 18 1,872,523 1,815,326
Share premium account 17,399,710 16,700,261
Share-based payment reserve 22,945 -
Other reserves 301,691 60,140
Retained earnings (15,902,031) (13,936,310)
------------------------------------ ----- ------------ ------------
Total equity 3,694,838 4,639,417
------------------------------------ ----- ------------ ------------
LIABILITIES
Current liabilities
Trade and other payables 15 619,139 393,685
Short-term borrowings 15 282,299 294,990
------------------------------------ ----- ------------ ------------
Total current liabilities 901,438 688,675
------------------------------------ ----- ------------ ------------
Total equity and liabilities 4,596,276 5,328,092
------------------------------------ ----- ------------ ------------
These financial statements were approved by the Board of
Directors and authorised for issue on 06 December 2016 and are
signed on its behalf by:
Andrew R M Bell
Executive Chairman
The accompanying notes form an integral part of these financial
statements.
Consolidated income statement
for the year ended 30 June 2016
Year to Year to
30 June 30 June
2016 2015 (restated)
Notes GBP GBP
-------------------------------------- ----- ----------- ----------------
Revenue
Management services 24,910 29,640
Total revenue 24,910 29,640
-------------------------------------- ----- ----------- ----------------
Gain / (loss) on dilution of interest
in associate 19,325 (215,157)
Loss on sales of investments (86,735) (382,678)
Adjustment to proceeds on prior
year sale of tenements (48,049) 66,469
Impairment of available for sale
financial assets (547,068) (3,425,976)
Exploration expenses (611) (6,747)
Impairment of exploration assets (658,281) (553,096)
Administrative expenses (net) (594,733) (964,761)
Share of losses of associates and
joint ventures (net of tax) (48,430) (420,418)
Finance costs, net 4 (26,050) (16,018)
-------------------------------------- ----- ----------- ----------------
Loss for the year before taxation 3 (1,965,722) (5,888,742)
Tax credit 5 - -
-------------------------------------- ----- ----------- ----------------
Loss for the year attributable
to owners of the Parent (1,965,722) (5,888,742)
-------------------------------------- ----- ----------- ----------------
Loss per share attributable to owners of the Parent
(1.20) (6.77)
Loss per share - basic 8 pence pence
(1.20) (6.77)
Loss per share - diluted 8 pence pence
-------------------------------------- ----- ----------- ----------------
All of the Group's operations are considered to be
continuing.
The accompanying notes form an integral part of these financial
statements.
Consolidated statement of comprehensive income
for the year ended 30 June 2016
30 June 30 June
2016 2015
GBP GBP
--------------------------------------------- ----------- -----------
Loss for the year (1,965,722) (5,888,742)
Other comprehensive (expense)/income
Items that will be reclassified subsequently
to profit or loss
Surplus on revaluation of available for
sale 184,297 394,641
Share of other comprehensive income of
associates 6,364 (12,814)
Unrealised foreign currency gain 50,892 48,450
--------------------------------------------- ----------- -----------
Other comprehensive income/(expense) for
the year 241,553 430,277
--------------------------------------------- ----------- -----------
Total comprehensive expense for the year
attributable to owners of the Parent (1,724,169) (5,458,465)
--------------------------------------------- ----------- -----------
The accompanying notes form an integral part of these financial
statements.
Consolidated statement of changes in equity
for the year ended 30 June 2016
The movements in equity during the year were as follows:
Share Share-based
Share premium Retained payment Other Total
capital account earnings reserve reserves equity
GBP GBP GBP GBP GBP GBP
---------------------------- --------- ---------- ------------ ----------- --------- -----------
As at 30 June 2014 1,475,403 15,944,484 (8,089,080) 41,512 (370,137) 9,002,182
Changes in equity
for 2015
Loss for the year - - (5,888,742) - - (5,888,742)
Other comprehensive
income for the year - - - - 430,277 430,277
Transactions with
owners
Issue of shares 339,923 782,132 - - - 1,122,055
Share issue and fundraising
costs - (26,355) - - - (26,355)
Share-based payment
transfer - - 41,512 (41,512) - -
---------------------------- --------- ---------- ------------ ----------- --------- -----------
Total transactions
with owners 339,923 755,777 41,512 (41,512) - 1,095,700
---------------------------- --------- ---------- ------------ ----------- --------- -----------
As at 30 June 2015 1,815,326 16,700,261 (13,936,310) - 60,140 4,639,417
Changes in equity
for 2016
Loss for the year - - (1,965,722) - - (1,965,722)
Other comprehensive
income for the year - - - - 241,553 241,553
Transactions with
owners
Issue of shares 57,196 749,449 - - - 806,645
Share issue and fundraising
costs - (50,000) - - - (50,000)
Share-based payment
transfer - - - 22,945 - 22,945
Total transactions
with owners 57,196 699,449 - 22,945 - 779,590
---------------------------- --------- ---------- ------------ ----------- --------- -----------
As at 30 June 2016 1,872,522 17,399,710 (15,902,032) 22,945 301,693 3,694,838
---------------------------- --------- ---------- ------------ ----------- --------- -----------
Available
for sale Foreign
financial Associate currency Total
asset investments translation other
reserve reserve reserve reserves
GBP GBP GBP GBP
------------------------------------- ---------- ------------ ------------ ---------
As at 30 June 2014 (311,934) (403,989) 345,786 (370,137)
Changes in equity for 2015
Other comprehensive (expense)/income
for the year 394,641 (12,814) 48,450 430,277
As at 30 June 2015 82,707 (416,803) 394,236 60,140
Changes in equity for 2016
Other comprehensive (expense)/income
for the year 184,297 6,364 50,892 241,553
As at 30 June 2016 267,004 (410,439) 445,128 301,693
------------------------------------- ---------- ------------ ------------ ---------
See note 16 for a description of each reserve included
above.
Consolidated statement of cash flows
for the year ended 30 June 2016
Year
Year to to
30 June 30 June
2016 2015
GBP GBP
------------------------------------------- ----------- -----------
Cash flows from operating activities
Loss before taxation (1,965,722) (5,888,742)
Decrease/(Increase) in receivables 283,555 (93,569)
Increase/(decrease) in payables 225,453 (109,740)
Depreciation 7,453 13,734
Impairment of exploration properties 658,281 553,096
Share-based payments 47,995 72,290
Currency adjustments (26,871) 154,425
Finance cost, net 26,050 16,018
Share of losses of associate 48,430 420,418
Loss on sale of investments 86,735 382,678
Adjustment to proceeds on prior year sale
of tenements 48,049 (66,469)
Impairment of available for sale financial
assets 547,068 3,425,976
(Gain)/loss on dilution of interest in
associate (19,325) 215,157
------------------------------------------- ----------- -----------
Net cash outflow from operations (32,849) (904,728)
------------------------------------------- ----------- -----------
Cash flows from investing activities
Interest received 15,869 17,003
Proceeds from sale of investments 124,158 605,123
Purchase of property, plant and equipment (20,343) -
Purchase of available for sale financial
assets (674,498) (300,000)
Payments for exploration costs (37,771) (347,428)
Payments for investments in associates
and joint ventures - (75,000)
------------------------------------------- ----------- -----------
Net cash outflow from investing activities (592,585) (100,302)
------------------------------------------- ----------- -----------
Cash inflows from financing activities
Proceeds from issue of shares 781,595 1,049,765
Transaction costs of issue of shares (50,000) (26,355)
Interest paid (41,919) (33,021)
Proceeds of new borrowings - 99,787
Repayment of borrowings (59,847) (348,906)
------------------------------------------- ----------- -----------
Net cash inflow from financing activities 629,829 741,270
------------------------------------------- ----------- -----------
Net (decrease)/increase in cash and cash
equivalents 4,395 (263,760)
Cash and cash equivalents at the beginning
of period 3,565 267,325
Cash and cash equivalents at end of period 7,960 3,565
------------------------------------------- ----------- -----------
The accompanying notes and accounting policies form an integral
part of these financial statements.
Company statement of financial position
as at 30 June 2016
30 June 30 June
2016 2015
Notes GBP GBP
------------------------------------ ----- ------------ ------------
ASSETS
Non-current assets
Property, plant and equipment 9 21,716 8,828
Investments in subsidiaries 10 482 482
Investments in associates and joint
ventures 11 1,754,773 1,827,454
Available for sale financial assets 12 1,147,460 909,749
Exploration assets 13 40,402 662,384
Trade and other receivables 14 2,003,858 2,109,247
Total non-current assets 4,968,691 5,518,144
------------------------------------ ----- ------------ ------------
Current assets
Cash and cash equivalents 20 6,626 2,432
Trade and other receivables 14 286,455 439,359
------------------------------------ ----- ------------ ------------
Total current assets 293,081 441,791
------------------------------------ ----- ------------ ------------
Total assets 5,261,772 5,959,935
------------------------------------ ----- ------------ ------------
EQUITY AND LIABILITIES
Called up share capital 18 1,872,522 1,815,326
Share premium account 17,399,710 16,700,261
Other reserves 240,772 33,530
Retained earnings (15,148,556) (13,267,690)
------------------------------------ ----- ------------ ------------
Total equity 4,364,448 5,281,427
------------------------------------ ----- ------------ ------------
LIABILITIES
Current liabilities
Trade and other payables 15 615,025 383,518
Short-term borrowings 15 282,299 294,990
------------------------------------ ----- ------------ ------------
Total current liabilities 897,324 678,508
------------------------------------ ----- ------------ ------------
Total equity and liabilities 5,261,772 5,959,935
------------------------------------ ----- ------------ ------------
These financial statements were approved by the Board of
Directors and authorised for issue on 06 December 2016 and are
signed on its behalf by:
Andrew R M Bell
Executive Chairman
The accompanying notes form an integral part of these financial
statements.
Company statement of changes in equity
for the year ended 30 June 2016
The movements in reserves during the year were as follows:
Share
Share premium Retained Other Total
capital account earnings reserves equity
GBP GBP GBP GBP GBP
----------------------------- --------- ---------- ------------ --------- -----------
As at 30 June 2014 1,475,403 15,944,484 (7,303,631) (336,651) 9,779,605
Changes in equity for
2015
Loss for the year - - (6,005,571) - (6,005,571)
Other comprehensive expense
for the year - - - 411,693 411,693
Transactions with owners
Issue of shares 339,923 782,132 - - 1,122,055
Share issue and fundraising
costs - (26,355) - - (26,355)
Share based payment transfer - - 41,512 (41,512) -
----------------------------- --------- ---------- ------------ --------- -----------
Total transactions with
owners 339,923 755,777 41,512 (41,512) 1,095,700
----------------------------- --------- ---------- ------------ --------- -----------
As at 30 June 2015 1,815,326 16,700,261 (13,267,690) 33,530 5,281,427
Changes in equity for
2016
Loss for the year - - (1,880,866) - (1,880,866)
Other comprehensive income
for the year - - - 184,297 184,297
Transactions with owners
Issue of shares 57,196 749,449 - - 806,645
Share issue and fundraising
costs - (50,000) - - (50,000)
Share based payment transfer - - - 22,945 22,945
Total transactions with
owners 57,196 699,449 - 22,945 779,590
----------------------------- --------- ---------- ------------ --------- -----------
As at 30 June 2016 1,872,522 17,399,710 (15,148,556) 240,772 4,364,448
----------------------------- --------- ---------- ------------ --------- -----------
Available
for sale
financial Share-based Total
asset payment Currency other
reserve reserve reserve reserves
GBP GBP GBP GBP
----------------------------- ---------- ----------- -------- ---------
As at 30 June 2014 (380,135) 41,512 1,972 (336,651)
Changes in equity for 2015
Other comprehensive expense
for the year 411,693 - - 411,693
Share based payment transfer - (41,512) - (41,512)
----------------------------- ---------- ----------- -------- ---------
As at 30 June 2015 31,558 - 1,972 33,530
Changes in equity for 2016
Other comprehensive income
for the year 184,297 - - 184,297
Share based payment transfer - 22,945 - 22,945
As at 30 June 2016 215,855 22,945 1,972 240,772
----------------------------- ---------- ----------- -------- ---------
See note 16 for a description of each reserve included
above.
Company statement of cash flows
for the year ended 30 June 2016
Year
Year to to
30 June 30 June
2016 2015
GBP GBP
-------------------------------------------- ----------- -----------
Cash flows from operating activities
Loss before taxation (1,880,866) (6,005,571)
Decrease/(increase) in receivables 258,294 (194,339)
Increase/(decrease) in payables 231,509 (117,230)
Depreciation 7,453 13,734
Share-based payments 47,995 72,290
Finance costs, net 26,050 16,018
Currency (gain)/loss 47,156 55,846
Loss on sale of investments 18,474 382,678
Impairment of associate 72,678 1,063,515
Impairment of available for sale investment 478,454 3,425,976
Impairment of exploration expenses 658,281 351,689
-------------------------------------------- ----------- -----------
Net cash outflow from operations (34,522) (935,394)
-------------------------------------------- ----------- -----------
Cash flows from investing activities
Interest received 15,869 17,003
Payments for exploration costs (36,299) (315,147)
Payments for investments in associates
and joint ventures - (75,000)
Purchase of property, plant and equipment (20,343) -
Purchase of available for sale financial
assets (674,498) (300,000)
Proceeds from sale of investments 124,158 605,123
-------------------------------------------- ----------- -----------
Net cash outflow from investing activities (591,113) (68,021)
-------------------------------------------- ----------- -----------
Cash inflows from financing activities
Proceeds from issue of shares 781,595 1,049,765
Transaction costs of issue of shares (50,000) (26,355)
Interest paid (41,919) (33,021)
Proceeds of new borrowings - 99,787
Repayments of borrowings (59,847) (348,906)
-------------------------------------------- ----------- -----------
Net cash inflow from financing activities 629,829 741,270
-------------------------------------------- ----------- -----------
Net (decrease)/increase in cash and cash
equivalents 4,194 (262,145)
Cash and cash equivalents at the beginning
of period 2,432 264,577
-------------------------------------------- ----------- -----------
Cash and cash equivalents at end of period 6,626 2,432
-------------------------------------------- ----------- -----------
The accompanying notes and accounting policies form an integral
part of these financial statements.
Notes to financial statements
for the year ended 30 June 2016
1. Principal accounting policies
1.1 Authorisation of financial statements and statement of
compliance with IFRS
The Group financial statements of Regency Mines plc ("the
Company" or "Regency") for the year ended 30 June 2016 were
authorised for issue by the Board on 06 December 2016 and signed on
the Board's behalf by Andrew Bell and Scott Kaintz. Regency Mines
plc is a public limited company incorporated and domiciled in
England and Wales. The Company's ordinary shares are traded on
AIM.
1.2 Basis of preparation
The financial statements have been prepared in accordance with
International Financial Reporting Standards and IFRIC
interpretations as endorsed by the EU ("IFRS") and the requirements
of the Companies Act applicable to companies reporting under
IFRS.
The financial statements have been prepared on the historical
cost basis, except for the revaluation of certain financial
instruments. The principal accounting policies adopted are set out
below.
Going concern
The consolidated entity has incurred a loss before tax of
GBP1,965,722 for the year ended 30 June 2016, and has a net cash
outflow of GBP625,634 from operating and investing activities. At
that date there was a net current liability position of GBP548,663.
The loss resulted mainly from provisions taken against the carrying
value of holdings in Direct Nickel Limited and exploration assets
in Sudan.
The consolidated entity continues to be reliant upon completion
of capital raising for continued operations, the provision of
working capital and for the repayment of the GBP282,299 interest
bearing loan due for full settlement in December 2016 and expected
to be financed with the lender with repayments starting later in
2016. Whilst the Directors have instituted measures to preserve
cash and secure additional finance, these circumstances create
material uncertainties over future trading results and cash
flows.
During the fiscal year the Board of Directors has completed the
disposal of its entire investment in Ram Resources for a total
consideration of GBP89,130.36. Further to this the Board has
surrendered its conversion rights of its remaining direct interest
in the Fraser Range project to Ram Resources for a total of
GBP55,386.32.
The Group's cash flow forecast for the 12 months ending 31
December 2017 highlights the fact that the company is expected to
generate negative cash flow through that period. The Board of
Directors are evaluating all the options available, including the
injection of funds into the Group during the next 12 months, and
are confident that the necessary funds will be raised in order for
the Group to remain cash positive for the whole period.
The Directors are confident in the Company's ability to raise
new finance from stock markets if this is required during 2017 and
the Group has demonstrated a consistent ability to do so. This
includes multiple share issuances of 150 million
(post-consolidation) shares for a total consideration of GBP0.876
million during the 2015-16 financial year
If additional equity capital is not obtained, the going concern
basis may not be appropriate, with the result that the Group may
have to realise its assets and extinguish its liabilities, other
than in the ordinary course of business and at amounts different
from those stated in the financial report. The Directors have
concluded that the combination of these circumstances represents a
material uncertainty that casts significant doubt upon the Group's
ability to continue as a going concern. Nevertheless after making
enquiries, and considering the uncertainties described above, the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. For these reasons, they continue to adopt the going concern
basis in preparing the annual report and accounts.
Company Statement of Comprehensive Income
As permitted by Section 408 Companies Act 2006, the Company has
not presented its own Statement of Comprehensive Income. The
Company's loss for the financial year was GBP1,880,866 (2015:
GBP6,005,571). The Company's other comprehensive income for the
financial year was GBP184,297 (2015: GBP411,693).
Amendments to published standards effective for the year ended
30 June 2016
New standards, amendments and interpretations adopted by the
Company
No new and/or revised Standards and Interpretations have been
required to be adopted, and/or are applicable in the current year
by/to the Company, as standards, amendments and interpretations
which are effective for the financial year beginning on 1 July 2014
are not material to the Company.
New standards, amendments and interpretations not yet
adopted
At the date of authorisation of these financial statements, the
following Standards and Interpretations which have not been applied
in these financial statements, were in issue but not yet effective
for the year presented:
- IFRS 9 in respect of Financial Instruments which will be
effective for the accounting periods beginning on or after 1
January 2018.
- IFRS 14 in respect of Regulatory Deferral Accounts which will
be effective for accounting periods beginning on or after 1 January
2016.
IFRS 15 in respect of Revenue from Contracts with Customers
which will be effective for accounting periods beginning on or
after 1 January 2017.
Amendments to IFRS 10, IFRS 12 and IAS 28 in respect of the
application of the consolidation exemption to investment entities
which will be effective for accounting periods beginning on or
after 1 January 2016.
Amendments to IFRS 10 and IAS 28 in respect of the treatment of
a sale or contribution of assets between an investor and its
Associate or Joint Venture which will be effective for accounting
periods beginning on or after 1 January 2016.
- Amendments to IFRS 11 in respect of Accounting for
Acquisitions of Interest in Joint Operations which will be
effective for accounting periods beginning on or after 1 January
2016.
- Amendments to IAS 1 in respect of determining what information
to disclose in annual financial statements which will be effective
for accounting periods beginning on or after 1 January 2016.
- Amendments to IAS 16 and IAS 38 in respect of Clarification of
Acceptable Methods of Depreciation and Amortisation which will be
effective for accounting periods beginning on or after 1 January
2016.
- Amendments to IAS 16 and IAS 41 in respect of Bearer Plants
which will be effective for accounting periods beginning on or
after 1 January 2016.
- Amendments to IAS 27 to allow entities to use the equity
method to account for investments in subsidiaries, joint ventures
and associates which will be effective for accounting periods
beginning 1 January 2016.
- Annual improvements to IFRS's which will be effective for
accounting periods beginning on or after 1 January 2016 as
follows:
-- IFRS 5 - Changes in methods of disposal
-- IFRS 7 - Servicing contracts
-- IFRS 7 - Applicability of the amendments to IFRS 7 to
condensed interim financial statements
-- IAS 19 - Discount rate: Regional market issue
-- IAS 34 - Disclosure of information "elsewhere in the interim financial report"
There are no other IFRSs or IFRIC interpretations that are not
yet effective that would be expected to have a material impact on
the Company.
Standards adopted early by the Group
The Group has not adopted any standards or interpretations early
in either the current or the preceding financial year.
1.3 Basis of consolidation
The consolidated financial statements of the Group incorporate
the financial statements of the Company and entities controlled by
the Company, its subsidiaries, made up to 30 June each year.
Subsidiaries
Subsidiaries are entities over which the Group has the power to
govern the financial and operating policies so as to obtain
economic benefits from their activities. Subsidiaries are
consolidated from the date on which control is obtained, the
acquisition date, until the date that control ceases.
The acquisition method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an
acquisition is measured as the fair value of the assets given,
equity instruments issued, contingent consideration and liabilities
incurred or assumed at the date of exchange. Costs directly
attributable to the acquisition are expensed as incurred.
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are initially
measured at fair value at the acquisition date.
Provisional fair values are adjusted against goodwill if
additional information is obtained within one year of the
acquisition date about facts or circumstances existing at the
acquisition date. Other changes in provisional fair values are
recognised through profit or loss.
Intra-group transactions, balances and unrealised gains and
losses on transactions between Group companies are eliminated on
consolidation, except to the extent that intra-group losses
indicate an impairment.
A change in the ownership interest of a subsidiary, without a
loss of control, is accounted for as an equity transaction. If the
Group loses control over a subsidiary, it:
-- derecognises the assets (including goodwill) and liabilities of the subsidiary;
-- derecognises the carrying amount of any non-controlling interest;
-- derecognises the cumulative translation differences recorded in equity;
-- recognises the fair value of the consideration received;
-- recognises the fair value of any investment retained;
-- recognises any surplus or deficit in profit or loss; and
-- reclassifies the Parent's share of components previously
recognised in other comprehensive income to profit or loss or
retained earnings, as appropriate.
For the year ended 30 June 2016, the consolidated financial
statements combine those of the Company with those of its
subsidiaries, Red Rock Uranium Pty Limited, Regency Mines
Australasia Pty Limited and Regency Resources Limited.
1.4 Summary of significant accounting policies
1.4.1 Investment in associates
An associate is an entity over which the Company is in a
position to exercise significant influence, but not control or
jointly control, through participation in the financial and
operating policy decisions of the investee.
Investments in associates are recognised in the consolidated
financial statements using the equity method of accounting. The
Group's share of post-acquisition profits or losses is recognised
in profit or loss and its share of post-acquisition movements in
other comprehensive income are recognised directly in other
comprehensive income. The carrying value of the investment,
including goodwill, is tested for impairment when there is
objective evidence of impairment. Losses in excess of the Group's
interest in those associates are not recognised unless the Group
has incurred obligations or made payments on behalf of the
associate.
Where a Group company transacts with an associate of the Group,
unrealised gains are eliminated to the extent of the Group's
interest in the relevant associate. Unrealised losses are also
eliminated unless the transaction provides evidence of an
impairment of the asset transferred in which case appropriate
provision is made for impairment.
Where the Company's holding in an associate is diluted, the
Company recognises a gain or loss on dilution in profit and loss.
This is calculated as the difference between the Company's share of
proceeds received for the dilutive share issue and the value of the
Company's effective disposal.
In the Company accounts investments in associates are recognised
and held at cost. The carrying value of the investment is tested
for impairment when there is objective evidence of impairment.
1.4.2 Interests in joint ventures
The Group has a contractual arrangement with Direct Nickel Pty
Ltd which represents a joint venture established through an
interest in a jointly controlled entity, Oro Nickel (Vanuatu)
Limited.
The Group recognises its interest in the entity's assets and
liabilities using the equity method of accounting. Under the equity
method, the interest in the joint venture is carried in the balance
sheet at cost plus post-acquisition changes in the Group's share of
its net assets, less distributions received and less any impairment
in value of individual investments. The Group Income Statement
reflects the share of the jointly controlled entity's results after
tax.
Any goodwill arising on the acquisition of a jointly controlled
entity is included in the carrying amount of the jointly controlled
entity and is not amortised. To the extent that the net fair value
of the entity's identifiable assets, liabilities and contingent
liabilities is greater than the cost of the investment, a gain is
recognised and added to the Group's share of the entity's profit or
loss in the period in which the investment is acquired.
Financial statements of the jointly controlled entity are
prepared for the same reporting period as the Group. Where
necessary, adjustments are made to bring the accounting policies
used into line with those of the Group and to reflect impairment
losses where appropriate. Adjustments are also made in the Group's
financial statements to eliminate the Group's share of unrealised
gains and losses on transactions between the Group and its jointly
controlled entity. The Group ceases to use the equity method on the
date from which it no longer has joint control over, or significant
influence in, the joint venture.
1.4.3 Taxation
Corporation tax payable is provided on taxable profits at the
current rate. The tax expense represents the sum of the current tax
expense and deferred tax expense.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from accounting profit as reported in
the Statement of Comprehensive Income because it excludes items of
income or expense that are taxable or deductible in other years and
it further excludes items that are never taxable or deductible. The
Group's liability for current tax is measured using tax rates that
have been enacted or substantively enacted by the reporting
date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amount of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities
are not recognised if the temporary difference arises from the
initial recognition of goodwill or from the initial recognition,
other than in a business combination, of other assets and
liabilities in a transaction which affects neither the taxable
profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries and associates
and interests in joint ventures, except where the Group is able to
control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable
future.
Deferred tax is calculated at the tax rates that are expected to
apply to the period when the asset is realised or the liability is
settled based upon tax rates that have been enacted or
substantively enacted by the reporting date.
Deferred tax is charged or credited in profit or loss, except
when it relates to items credited or charged directly to equity, in
which case the deferred tax is also dealt with in equity, or items
charged or credited directly to other comprehensive income, in
which case the deferred tax is also recognised in other
comprehensive income.
Deferred tax assets and liabilities are offset where there is a
legally enforceable right to offset current tax assets and
liabilities and the deferred tax relates to income tax levied by
the same tax authorities on either:
-- the same taxable entity; or
-- different taxable entities which intend to settle current tax
assets and liabilities on a net basis or to realise and settle them
simultaneously in each future period when the significant deferred
tax assets and liabilities are expected to be realised or
settled.
1.4.4 Property, plant and equipment
Property, plant and equipment acquired and identified as having
a useful life that exceeds one year is capitalised at cost and is
depreciated on a straight line basis at annual rates that will
reduce book values to estimated residual values over their
anticipated useful lives as follows:
Office furniture, fixtures and fittings - 33% per annum
Leasehold improvements - 5% per annum
1.4.5 Foreign currencies
Both the functional and presentational currency of Regency Mines
plc is Sterling (GBP). Each Group entity determines its own
functional currency and items included in the financial statements
of each entity are measured using that functional currency.
The functional currencies of the foreign subsidiaries and joint
ventures are the Australian Dollar ("AUD"), the Papua New Guinea
Kina ("PNG") and the US Dollar ("USD").
Transactions in currencies other than the functional currency of
the relevant entity are initially recorded at the exchange rate
prevailing on the dates of the transaction. At each reporting date,
monetary assets and liabilities that are denominated in foreign
currencies are retranslated at the exchange rate prevailing at the
reporting date. Non-monetary assets and liabilities carried at fair
value that are denominated in foreign currencies are translated at
the rates prevailing at the date when the fair value was
determined. Gains and losses arising on retranslation are included
in profit or loss for the period, except for exchange differences
on non-monetary assets and liabilities, which are recognised
directly in other comprehensive income when the changes in fair
value are recognised directly in other comprehensive income.
On consolidation, the assets and liabilities of the Group's
overseas operations are translated into the Group's presentational
currency at exchange rates prevailing at the reporting date. Income
and expense items are translated at the average exchange rates for
the period unless exchange rates have fluctuated significantly
during the year, in which case the exchange rate at the date of the
transaction is used. All exchange differences arising, if any, are
recognised as other comprehensive income and are transferred to the
Group's foreign currency translation reserve.
1.4.6 Revenue
Revenue is the gross inflow of economic benefits during the
period arising in the course of the ordinary activities of the
Group and the Company, when those inflows result in increases in
equity.
Revenue is measured at the fair value of the consideration
received or receivable for investment asset disposals in the normal
course of business and is recognised when revenue and associated
costs can be measured reliably and future economic benefits are
probable.
In addition, revenue from management services is recognised on
an accruals basis when the services have been delivered and any
associated costs have been incurred.
1.4.7 Exploration assets
Exploration assets comprise exploration and development costs
incurred on prospects at an exploratory stage. These costs include
the cost of acquisition, exploration, determination of recoverable
reserves, economic feasibility studies and all technical and
administrative overheads directly associated with those projects.
These costs are carried forward in the Statement of Financial
Position as non-current intangible assets less provision for
identified impairments.
Recoupment of exploration and development costs is dependent
upon successful development and commercial exploitation of each
area of interest and will be amortised over the expected commercial
life of each area once production commences. The Group and the
Company currently have no exploration assets where production has
commenced.
The Group adopts the "area of interest" method of accounting
whereby all exploration and development costs relating to an area
of interest are capitalised and carried forward until abandoned. In
the event that an area of interest is abandoned, or if the
Directors consider the expenditure to be of no value, accumulated
exploration costs are written off in the financial year in which
the decision is made. All expenditure incurred prior to approval of
an application is expensed with the exception of refundable rent
which is raised as a receivable.
Upon disposal, the difference between the fair value of
consideration receivable for exploration assets and the relevant
cost within non-current assets is recognised in the Income
Statement.
1.4.8 Share-based payments
The Group operates an equity-settled share-based payment
arrangement whereby the fair value of services provided is
determined indirectly by reference to the fair value of the
instrument granted.
The fair value of options granted to Directors and others in
respect of services provided is recognised as an expense in the
statements of income with a corresponding increase in equity
reserves - the share-based payment reserve.
On exercise or lapse of share options, the proportion of the
share-based payment reserve relevant to those options is
transferred to retained earnings. On exercise, equity is also
increased by the amount of the proceeds received.
The fair value is measured at grant date and charged over the
vesting period during which the option becomes unconditional.
The fair value of options is calculated using the Black-Scholes
model taking into account the terms and conditions upon which the
options were granted. There are no market vesting conditions. The
exercise price is fixed at the date of grant. For other equity
instruments granted during the year (i.e. other than share
options), fair value is measured on the basis of an observable
market price.
1.4.9 Pension
The Group operates a defined contribution pension plan which
requires contributions to be made to a separately administered
fund. Contributions to the defined contribution scheme are charged
to the profit and loss account as they become payable.
1.4.10 Finance costs/revenue
Borrowing costs are recognised on an accruals basis using the
effective interest method.
Finance revenue is recognised as interest accrues using the
effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest
income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the
net carrying amount of the financial asset.
1.4.11 Financial instruments
Financial assets and financial liabilities are recognised where
the Group has become party to the contractual provisions of the
instrument.
Financial assets
Investments
Investments in subsidiary companies are classified as
non-current assets and included in the Statement of Financial
Position of the Company at cost at the date of acquisition less any
identified impairments.
Investments in associate companies are classified as non-current
assets and included in the Statement of Financial Position of the
Company at cost at the date of acquisition less any identified
impairments.
For acquisitions of subsidiaries or associates achieved in
stages, the Company re-measures its previously held equity
interests in the acquiree at its acquisition-date fair value and
recognises the resulting gain or loss, if any, in profit or loss.
Any gains or losses previously recognised in other comprehensive
income are transferred to profit and loss.
Available for sale financial assets
Equity investments intended to be held for an indefinite period
of time are classified as available for sale financial assets. They
are carried at fair value, where this can be reliably measured,
with movements in fair value recognised in other comprehensive
income and debited or credited to the available for sale financial
assets reserve. Where the fair value cannot be reliably measured,
the investment is carried at cost or a lower valuation where the
Directors consider the value of the investment to be impaired.
Available for sale financial assets are included within
non-current assets. On disposal, the difference between the
carrying amount and the sum of the consideration received and any
cumulative gain or loss that had previously been recognised
directly in reserves is recognised in the Income Statement.
Income from available for sale financial assets is accounted for
in the Income Statement when the right to receive it has been
established.
The Group assesses at each reporting date whether there is
objective evidence that an investment is impaired. When there is
evidence of impairment, the cumulative loss - measured as the
difference between the acquisition cost and the current fair value,
less any impairment loss on that investment previously recognised
in the Income Statement - is removed from other comprehensive
income and recognised in the Income Statement. Impairment losses on
equity investments are not reversed through the income statement;
increases in their fair value after impairment are recognised
directly in other comprehensive income.
Cash and cash equivalents
Cash and short-term deposits in the statement of financial
position comprise cash at bank and in hand and short-term
deposits.
For the purposes of the statement of cash flows, cash and cash
equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts.
Trade and other receivables
Trade receivables, which generally have 30 day terms, are
recognised and carried at original invoice amount less an allowance
for any uncollectable amounts.
An allowance for impairment is made when there is objective
evidence that the Group will not be able to collect the debts. Bad
debts are written off when identified.
After initial recognition these assets are measured at amortised
cost using the effective interest method less provision for
impairment.
Financial liabilities and equity
Trade and other payables
Trade and other payables are initially recognised at fair value
and represent liabilities for goods and services provided to the
Group prior to the end of the financial year that are unpaid and
arise when the Group becomes obliged to make future payments in
respect of the purchase of these goods and services.
Short-term borrowings
Short-term borrowings are recorded initially at their fair
value, plus directly attributable transaction costs. Such
instruments are subsequently carried at their amortised cost and
finance charges, including premiums payable on settlement or
redemption, are recognised in profit or loss over the term of the
instrument using an effective rate of interest.
Equity instruments
Equity instruments issued by the Company are recorded at fair
value as initial recognition net of issue costs.
1.5 Significant accounting judgements, estimates and
assumptions
The preparation of the Group's consolidated financial statements
requires management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities at the end of the reporting period. However,
uncertainty about these assumptions and estimates could result in
outcomes that require a material adjustment to the carrying amount
of the asset or liability affected in future periods.
Significant judgements in applying the accounting policies
In the process of applying the Group's accounting policies,
management has made the following judgements, which have the most
significant effect on the amounts recognised in the consolidated
financial statements:
Recognition of holdings less than 20% as an associate
The Directors have classified, as an associate, an equity
investment where the Company is in a position to exercise
significant influence, but not control or joint control, through
participation in the financial and operating policy decisions of
the investee.
Significant influence is presumed when the Company holds greater
than 20% of the voting power of the investee, unless it can be
clearly demonstrated that this is not the case. Conversely, if the
Company holds less than 20% of the voting power of an investee, it
is presumed that the Company does not have significant influence,
unless such influence can be clearly demonstrated.
The Company owns 2.32% (2015: 4.87%) of the issued share capital
of Red Rock Resources plc. Andrew Bell, Chairman and Chief
Executive Officer of the Company, is also a member of the Board and
the Executive Chairman of Red Rock Resources plc. In accordance
with IAS 28, the Directors of the Company consider this to provide
the Group with significant influence as defined by the standard. As
such, it continues to recognise Red Rock Resources plc as an
associate for the year ended 30 June 2016 despite its shareholding
falling below 20%.
The effect of recognising Red Rock Resources as an available for
sale financial asset would be to decrease the loss by GBP9,878 and
decrease other comprehensive income by GBP6,364.
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often
determined based on estimates and assumptions of future events. The
key estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of certain
assets and liabilities within the next annual reporting period
are:
Share-based payment transactions
The Group measures the cost of equity-settled transactions with
employees by reference to the fair value of the equity instruments
at the date at which they are granted. The fair value of share
options is determined using the Black-Scholes model.
Fair value measurement
Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to
sell the asset or transfer the liability takes place either:
-- In the principal market for the asset or liability; or
-- In the absence of a principal market, in the most
advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible
by the Group.
The fair value of an asset or a liability is measured using the
assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their
economic best interest.
A fair value measurement of a non-financial asset takes into
account a market participant's ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset
in its highest and best use.
The Group uses valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or
disclosed in the financial statements are categorised within the
fair value hierarchy, described as follows, based on the lowest
level input that is significant to the fair value measurement as a
whole:
-- Level 1 - Quoted (unadjusted) market prices in active markets
for identical assets or liabilities;
-- Level 2 - Valuation techniques for which the lowest level
input that is significant to the fair value measurement is directly
or indirectly observable; and
-- Level 3 - Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
For assets and liabilities that are recognised in the financial
statements on a recurring basis, the Group determines whether
transfers have occurred between levels in the hierarchy by
re-assessing categorisation (based on the lowest level input that
is significant to the fair value measurement as a whole) at the end
of each reporting period.
For the purpose of fair value disclosures, the Group has
determined classes of assets and liabilities on the basis of the
nature, characteristics and risks of the asset or liability and the
level of the fair value hierarchy as explained above.
Impairment of available for sale financial assets
The Group follows the guidance of IAS 39 to determine when an
available for sale financial asset or a group of financial assets
is impaired. A financial asset or a group of financial assets is
deemed to be impaired if, and only if, there is objective evidence
of impairment as a result of one or more events that has occurred
after the initial recognition of the asset (an incurred "loss
event") and that loss event has an impact on the estimated future
cash flows of the financial asset or the group of financial assets
that can be reliably estimated. This determination requires
significant judgement. In making this judgement, the Group
evaluates, among other factors, the duration and extent to which
fair value of an investment is less than its cost.
In the case of equity investments classified as available for
sale, objective evidence would include a significant or prolonged
decline in the fair value of the investment below its cost.
"Significant" is evaluated against the original cost of the
investment and "prolonged" against the period in which the fair
value has been below its original cost. Mining share prices
typically have more volatility than most other shares and this is
taken into account by management when considering if a significant
decline in the fair value of its mining investments has occurred.
Management would consider that there is a prolonged decline in the
fair value of an equity investment when the period of decline in
fair value has extended to beyond the expectation management have
for the equity investment. This expectation will be influenced
particularly by the company development cycle of the
investment.
2. Segmental analysis
As with all natural resource exploration and development
ventures yet to generate cash from operations, ensuring adequate
cash is available to meet operational obligations and to provide
for investment opportunities is critical. This is therefore the
main focus of management information presented to the chief
operational decision makers, being the Executive Chairman and the
Board of Directors.
The only sources of funds are issues of new equity and sales of
exploration rights, investments or other assets. Therefore, in
addition to monitoring the current market perception of the Company
to shareholders, brokers and other possible providers of equity
finance, constant attention is paid to:
available cash;
the market value of the Group's listed investments.
At 30 June 2016 the Group had cash and cash equivalents of
GBP7,960.
The market value of the most significant of the Group's listed
investments at 30 June 2016 is as follows:
Red Rock Resources plc GBP40,881.
Once the Group's main focus of operations becomes production of
natural resources, the nature of management information examined by
the Board will alter to reflect the need to monitor revenues,
margins, overheads and trade balances, as well as cash.
IFRS 8 requires the reporting of information about the revenues
derived from the various areas of activity, the countries in which
revenue is earned regardless of whether this information is used in
by management in making operating decisions.
Investment
in
Red Rock Papua Corporate
Resources Other Australian New Guinea and
Year to 30 June plc investments exploration exploration unallocated Total
2016 GBP GBP GBP GBP GBP GBP
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
Revenue
Management services - - - - 24,910 24,910
- - - - 24,910 24,910
Gain on dilution
of interest in associate 19,325 - - - - 19,325
Adjustment to proceeds
on prior year sale
of tenements - - (48,049) - - (48,049)
Gain/(loss) on sale
of investments - 17,880 (104,616) - - (86,736)
Exploration expenses - (658,281) (611) - - (658,892)
Administrative expenses* - - 84,526 - (679,257) (594,732)
Share of profits
in associates (48,430) - - - - (48,430)
Impairment of available
for sale investments - (547,067) - - - (547,067)
Finance cost - net - - - - (26,050) (26,050)
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
Net (loss)/profit
before tax from
continuing operations (29,105) (1,187,468) (68,750) - (680,397) (1,965,722)
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
Investment
in
Red Rock Papua Corporate
Resources Other Australian New Guinea and
Year to 30 June plc investments exploration exploration unallocated Total
2015 GBP GBP GBP GBP GBP GBP
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
Revenue
Management services - - - - 29,640 29,640
Gain on sale of
tenements - - 66,469 - - 66,469
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
- - 66,469 - 29,640 96,109
Loss on dilution
of interest in associate (215,157) - - - - (215,157)
Loss on sale of
investments - 131,756 (514,434) - - (382,678)
Exploration expenses - (341,404) (208,154) (10,285) - (559,843)
Administrative expenses* - - (169,427) - (795,334) (964,761)
Share of losses
in associates (431,906) - - 11,488 - (420,418)
Impairment of available
for sale investments - (3,425,976) - - - (3,425,976)
Finance cost - net - - - - (16,018) (16,018)
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
Net (loss)/profit
before tax from
continuing operations (647,063) (3,635,624) (825,546) 1,203 (781,712) (5,888,742)
-------------------------- ---------- ------------ ------------ ------------ ------------ -----------
* Included in administrative expenses is depreciation charge of
GBP7,453 (2015: GBP13,734) under Corporate and unallocated.
Information by geographical area
Presented below is certain information by the geographical area
of the Group's activities. Investment sales revenue and exploration
property sales revenue are allocated to the location of the asset
sold.
Papua
UK Australia New Guinea Sudan Other Total
Year to 30 June 2016 GBP GBP GBP GBP GBP GBP
---------------------------- ------------ ------------ ----------- ----------- ----------- ---------------
Revenue
Management services 24,910 - - - - 24,910
Adjustment to proceeds
on prior year sale
of tenements - (48,049) - - - (48,049)
Loss on sale of investments - (74,526) - - - (74,526)
---------------------------- ------------ ------------ ----------- ----------- ----------- ---------------
Total segment revenue 24,910 (122,575 - - - (97,665)
---------------------------- ------------ ------------ ----------- ----------- ----------- ---------------
Non-current assets
Investments in associates
and joint ventures 15,811 - 1,622,302 - - 1,638,113
Property, plant and
equipment 21,717 - - - - 21,717
Available for sale
financial assets 932,085 215,375 - - - 1,147,460
Exploration assets - 175,527 - - 58,375 233,901
---------------------------- ------------ ------------ ----------- ----------- ----------- ---------------
Total segment non-current
assets 969,613 390,902 1,622,302 - 58,375 3,041,191
---------------------------- ------------ ------------ ----------- ----------- ----------- ---------------
Papua
UK Australia New Guinea Sudan Other Total
Year to 30 June 2015 GBP GBP GBP GBP GBP GBP
-------------------------- ------------ ----------- ----------- -------- ------- ---------------
Revenue
Management services 29,640 - - - - 29,640
Gain on sale of tenements - 66,469 - - - 66,469
-------------------------- ------------ ----------- ----------- -------- ------- ---------------
Total segment revenue 29,640 66,469 - - - 96,109
-------------------------- ------------ ----------- ----------- -------- ------- ---------------
Non-current assets
Investments in associates
and joint ventures - - 1,660,854 - - 1,660,854
Property, plant and
equipment 8,828 - - - - 8,828
Available for sale
financial assets 147,307 847,704 - - - 995,011
Exploration assets - 149,141 - 626,810 53,200 829,151
-------------------------- ------------ ----------- ----------- -------- ------- ---------------
Total segment non-current
assets 156,135 996,845 1,660,854 626,810 53,200 3,493,844
-------------------------- ------------ ----------- ----------- -------- ------- ---------------
3. Loss on ordinary activities before taxation
2016 2015
Group GBP GBP
---------------------------------------------- ------- -------
Loss on ordinary activities before taxation
is stated after charging:
Auditor's remuneration:
- fees payable to the Company's auditor
for the audit of consolidated and Company
financial statements 15,000 15,000
- fees payable to subsidiary auditors for
the audit of subsidiary financial statements 2,294 2,225
Depreciation 7,453 13,734
Directors' emoluments 172,855 204,401
Share-based payments - Directors 39,392 30,000
Share-based payments - Staff 8,603 42,290
---------------------------------------------- ------- -------
As declared in note 7, Directors are remunerated in part by
third parties with whom the Company and Group have contractual
arrangements.
4. Finance costs, net
2016 2015
GBP GBP
----------------- -------- --------
Interest expense (41,919) (33,021)
Interest income 15,869 17,003
----------------- -------- --------
(26,050) (16,018)
----------------- -------- --------
5. Taxation
2016 2015
GBP GBP
-------------------------------------------------- ----------- -----------
Current period transaction of the Group
UK corporation tax at 20.00% (2015: 20.75%)
on profits for the period - -
Deferred tax
Origination and reversal of temporary differences - -
Deferred tax assets derecognised - -
-------------------------------------------------- ----------- -----------
Tax (credit) - -
-------------------------------------------------- ----------- -----------
Factors affecting the tax charge for the
year
Loss on ordinary activities before taxation (1,965,722) (5,888,742)
-------------------------------------------------- ----------- -----------
Loss on ordinary activities at the average
UK standard rate of 20.00% (2015: 20.75%) (393,144) (1,221,914)
Impact of subsidiaries and associates 5,943 (24,242)
Effect of non-deductible expense 241,070 948,066
Effect of tax benefit of losses carried
forward 146,131 298,090
Current tax (credit) - -
-------------------------------------------------- ----------- -----------
Finance Act 2013 set the main rate of corporation tax at 20%
from 1 April 2015 and at 20% from 1 April 2016.
6. Staff costs
The aggregate employment costs of staff (including Directors)
for the year was:
2016 2015
GBP GBP
------------------------------------ ------- -------
Wages and salaries 211,646 455,774
Severance costs 14,679 -
Pension 12,704 18,743
Social security costs 17,953 40,785
Employee share-based payment charge 47,995 72,290
------------------------------------ ------- -------
Total staff costs 304,977 587,592
------------------------------------ ------- -------
The average number of Group employees (including Directors)
during the year was:
2016 2015
Number Number
--------------- ------- -------
Executives 3 5
Administration 1 7
Exploration - 5
--------------- ------- -------
4 17
--------------- ------- -------
The Company's staff are employed both by the Company and Red
Rock Resources plc ("Red Rock"). During the year, staff costs of
GBP34,151 (2015: GBP105,848) were recharged to Red Rock. Such
recharges are offset against administration expenses in the income
statement.
During the year, for all Directors and employees who have been
employed for more than three months, the Company contributed to a
defined contributions pension scheme as described under Directors'
remuneration in the Directors' Report and a Share Incentive Plan
("SIP") as described under Management incentives in the Directors'
Report.
7. Directors' emoluments
Social
Directors' Consultancy Share-based Pension security
fees fees payments contributions costs Total
2016 GBP GBP GBP GBP GBP GBP
------------------------ ---------- ----------- ----------- --------------- --------- -------
Executive Directors
A R M Bell 48,000 15,000 15,883 3,485 3,156 85,524
S Kaintz 65,000 - 15,427 3,284 6,468 90,180
------------------------ ---------- ----------- ----------- --------------- --------- -------
Non-executive Directors
E Bugnosen 18,000 - 8,082 934 1,006 28,022
J M E Lee (resigned
30 Sept 16) 4,500 - - - (156) 4,344
J Watkins (resigned
15 Sept 16) 4,500 - - - (322) 4,178
------------------------ ---------- ----------- ----------- --------------- --------- -------
140,000 15,000 39,392 7,703 10,152 212,247
------------------------ ---------- ----------- ----------- --------------- --------- -------
Social
Directors' Consultancy Share-based Pension security
fees fees payments contributions costs Total
2015 GBP GBP - SIP GBP GBP GBP GBP
------------------------ ---------- ----------- ----------- --------------- --------- -------
Executive Directors
A R M Bell 48,000 15,000 6,000 2,930 4,531 76,461
S Kaintz 65,000 - 6,000 3,138 7,440 81,578
------------------------ ---------- ----------- ----------- --------------- --------- -------
Non-executive Directors
E Bugnosen 18,000 - 6,000 882 1,092 25,974
J M E Lee 18,000 - 6,000 - 1,163 25,163
J Watkins 18,000 - 6,000 - 1,225 25,225
------------------------ ---------- ----------- ----------- --------------- --------- -------
167,000 15,000 30,000 6,950 15,451 234,401
------------------------ ---------- ----------- ----------- --------------- --------- -------
The number of Directors who exercised share options in year was
nil (2015: nil).
During the year, the Company contributed to a Share Incentive
Plan more fully described in the Directors' Report. 1,339,074
(2015: 4,285,714) free shares were issued to each employee,
including Directors, making a total of 5,356,296 (2015: 21,428,571)
free shares issued.
8. Loss per share
The basic loss per share is derived by dividing the loss for the
year attributable to ordinary shareholders of the Parent by the
weighted average number of shares in issue.
Diluted loss per share is derived by dividing the loss for the
year attributable to ordinary shareholders of the Parent by the
weighted average number of shares in issue plus the weighted
average number of ordinary shares that would be issued on
conversion of all dilutive potential ordinary shares into ordinary
shares.
The following reflects the loss and share data used in the basic
and diluted loss per share computations:
2016 2015 (restated)
-------------------------------------------- -------------- ---------------
Loss attributable to equity holders
of the Parent GBP(1,965,722) GBP(5,888,742)
Weighted average number of ordinary
shares of GBP0.0001 (2015: GBP0.001)
in issue 163,621,119 87,017,523
(1.20) (6.77)
Loss per share - basic pence pence
-------------------------------------------- -------------- ---------------
Weighted average number of ordinary
shares of GBP0.0001 (2015: GBP0.001)
in issue inclusive of dilutive outstanding
options 163,621,119 87,017,523
(1.20) (6.77)
Loss per share - fully diluted pence pence
-------------------------------------------- -------------- ---------------
The weighted average number of shares issued for the purposes of
calculating diluted earnings per share reconciles to the number
used to calculate basic earnings per share as follows:
2016 2015 (restated)
GBP GBP
------------------------------------ ----------- ---------------
Loss per share denominator 163,621,119 87,017,523
Weighted average number of dilutive
share options - -
------------------------------------ ----------- ---------------
Diluted loss per share denominator 163,621,119 87,017,523
------------------------------------ ----------- ---------------
In accordance with IAS 33, the diluted earnings per share
denominator takes into account the difference between the average
market price of ordinary shares in the year and the weighted
average exercise price of the outstanding options. The Group has
weighted average share options of 502,904 (2015: 3,201,099) which
were not included in the calculation of diluted loss per share
because they are non-dilutive for the year presented.
9. Property, plant and equipment
Office furniture
Leasehold and
improvements equipment Total
Group and Company GBP GBP GBP
------------------ --------------------------------- ---------------- ---------
Cost
At 1 July 2014 14,822 124,370 139,192
Additions - - -
Disposals - - -
Currency exchange - - -
------------------ --------------------------------- ---------------- ---------
At 30 June 2015 14,822 124,370 139,192
Additions 18,000 2,342 20,342
At 30 June 2016 32,822 126,712 159,534
------------------ --------------------------------- ---------------- ---------
Depreciation
At 1 July 2014 (10,756) (105,874) (116,630)
Charge (4,066) (9,668) (13,734)
Currency exchange - - -
------------------ --------------------------------- ---------------- ---------
At 30 June 2015 (14,822) (115,542) (130,364)
Charge (600) (6,853) (7,453)
At 30 June 2016 (15,422) (122,395) (137,817)
------------------ --------------------------------- ---------------- ---------
Net book value
At 30 June 2016 17,400 4,317 21,717
------------------ --------------------------------- ---------------- ---------
At 30 June 2015 - 8,828 8,828
------------------ --------------------------------- ---------------- ---------
10. Investments in subsidiaries
Company GBP
----------------------------------------- ---
Cost
At 30 June 2016 and 2015 482
----------------------------------------- ---
Impairment
At 30 June 2016 and 2015 -
----------------------------------------- ---
Net carrying value
Net book amount at 30 June 2016 and 2015 482
----------------------------------------- ---
The Parent Company of the Group holds more than 50% of the share
capital of the following companies, the results of which are
consolidated:
Proportion
Country of held by Nature of
Company registration Class Group business
------------------------- ------------- -------- ---------- -------------------
Red Rock Uranium
Pty Limited Australia Ordinary 100% Mineral exploration
Regency Mines Australasia
Pty Limited Australia Ordinary 100% Mineral exploration
Regency Resources
Limited Australia Ordinary 100% Dormant
Regency Resources
Inc USA Ordinary 100% Oil exploration
------------------------- ------------- -------- ---------- -------------------
11. Investments in associates and joint ventures
Group Company
Carrying balance GBP GBP
-------------------------------------- ------------------------- ----------------------
At 30 June 2014 2,234,244 2,815,969
Additions 75,000 75,000
Impairment - (1,063,515)
Loss on dilution of interest (215,157) -
Share of total comprehensive loss for
the year (433,233) -
-------------------------------------- ------------------------- ----------------------
At 30 June 2015 1,660,854 1,827,454
Additions - -
Impairment - (72,678)
Loss on dilution of interest 19,325 -
Share of total comprehensive loss for
the year (42,066) -
-------------------------------------- ------------------------- ----------------------
Net book amount at 30 June 2016 1,638,113 1,754,776
-------------------------------------- ------------------------- ----------------------
The market value of investments in listed associates as at 30
June 2016 was GBP40,881 (2015: GBP113,560).
The Parent Company of the Group, as at 30 June 2016, had a
significant influence by virtue other than a shareholding of over
20% or had joint control through a joint venture contractual
arrangement in the following companies:
Proportion
Country held
of by Accounting
Name registration Class Group year end
---------------------- ------------- -------- ---------- ----------
Direct
England 30 June
Red Rock Resources plc and Wales Ordinary 2.32% 2016
Oro Nickel (Vanuatu) 30 June
Limited Vanuatu Ordinary 50.00% 2016
---------------------- ------------- -------- ---------- ----------
Summarised financial information for the Company's associates
and joint ventures, where available, as at 30 June 2016 is given
below:
For the year ended As at 30 June
30 June 2016 2016
---------------------------------------
Total comprehensive
Revenue Loss expense Assets Liabilities
Name GBP GBP GBP GBP GBP
------------------- ------- --------- ------------------- ---------- -----------
Red Rock Resources
plc - (283,280) (106,089) 10,538,727 (1,911,492)
------------------- ------- --------- ------------------- ---------- -----------
12. Available for sale financial assets
Group Company
GBP GBP
------------------------------- ----------- -----------
Net book amount
At 30 June 2014 4,611,833 4,611,833
Additions during the year 402,314 300,000
Disposals during year (987,801) (987,801)
Impairments during the year (3,425,976) (3,425,976)
Revaluation 394,641 411,693
At 30 June 2015 995,011 909,749
Additions during the year 674,498 674,498
Disposals during year (227,894) (142,632)
Impairments during year (478,452) (478,452)
Revaluation 184,297 184,297
Net book value at 30 June 2016 1,147,460 1,147,460
------------------------------- ----------- -----------
The value of the Company's investment in Horse Hill Developments
Ltd ("HHDL") has been increased during the year based on
transactions that occurred in shares of the entity during the year.
However, it is important to note that shares in HHDL remain
unlisted and thus valuations are based on a relatively small number
of transactions between arm's length buyers. See Note 20 for
additional details of listed and unlisted AFS assets.
13. Exploration assets
Group Company
------------------------ ----------------------
2016 2015 2016 2015
GBP GBP GBP GBP
-------------------------- ----------- ----------- ----------- ---------
Cost
At 30 June 2015 2,540,744 2,684,318 1,014,073 698,926
Additions during the year 37,771 347,428 36,299 315,147
Disposals in the year - (200,647) - -
Exchange gains 206,603 (290,355) - -
-------------------------- ----------- ----------- ----------- ---------
At 30 June 2016 2,785,118 2,540,744 1,050,372 1,014,073
-------------------------- ----------- ----------- ----------- ---------
Impairment
At 30 June 2015 (1,711,593) (1,486,012) (351,689) -
Impairments recognised
in the year (658,281) (553,096) (658,281) (351,689)
Disposals in the year - 87,920 - -
Exchange gains (181,344) 240,225 - -
-------------------------- ----------- ----------- ----------- ---------
At 30 June 2016 (2,551,218) (1,711,593) (1,009,970) (351,689)
-------------------------- ----------- ----------- ----------- ---------
Net book value
At 30 June 2016 233,900 829,152 40,402 662,384
-------------------------- ----------- ----------- ----------- ---------
At 30 June 2015 829,151 1,198,306 662,384 698,926
-------------------------- ----------- ----------- ----------- ---------
14. Trade and other receivables
Group Company
--------------------
2016 2015 2016 2015
GBP GBP GBP GBP
----------------------------------- --------- --------- --------- ---------
Non-current
Amounts owed by Group undertakings - - 801,546 913,340
Amounts owed by related
parties
- due from associates and
joint ventures 1,202,312 1,195,907 1,202,312 1,195,907
----------------------------------- --------- --------- --------- ---------
Total 1,202,312 1,195,907 2,003,858 2,109,247
----------------------------------- --------- --------- --------- ---------
Current
Sundry debtors 222,617 287,211 164,257 91,794
Prepayments 35,232 29,683 35,232 29,683
Amounts owed by related
parties
- due from associates and
joint ventures 86,966 317,882 86,966 317,882
Total 344,815 634,776 286,455 439,359
----------------------------------- --------- --------- --------- ---------
15. Trade and other payables
Group Company
---------------- ----------------
2016 2015 2016 2015
GBP GBP GBP GBP
------------------------- ------- ------- ------- -------
Trade and other payables 387,467 192,034 383,353 181,867
Accruals 221,663 197,680 221,663 197,680
Amounts due to related
parties:
- due to associates - - - -
- due to key management 10,009 3,971 10,009 3,971
------------------------- ------- ------- ------- -------
Trade and other payables 619,139 393,685 615,025 383,518
Short-term borrowings 282,299 294,990 282,299 294,990
------------------------- ------- ------- ------- -------
Total 901,438 688,675 897,324 678,508
------------------------- ------- ------- ------- -------
YA Global Master SPV Limited
A short-term loan of GBPnil (2015: GBP99,787) was provided by YA
Global Master SPV Limited. Interest on the balance of this loan is
charged at a rate of 12% (2015: 12%) per annum. Repayments are made
either in cash or by issue of shares in the Company in line with
the terms of the agreement. The Company has pledged all of its
shares in Oro Nickel (Vanuatu) Limited as well as 9,084,760 shares
in Red Rock Resources plc as security for the loans.
16. Reserves
Share premium
The share premium account represents the excess of consideration
received for shares issued above their nominal value net of
transaction costs.
Foreign currency translation reserve
The translation reserve represents the exchange gains and losses
that have arisen on the retranslation of overseas operations.
Retained earnings
Retained earnings represent the cumulative profit and loss net
of distributions to owners.
Available for sale financial asset reserve
The available for sale financial asset reserve represents the
cumulative revaluation gains and losses in respect of available for
sale trade investments.
Associate investment reserve
The associate investments reserve represents the cumulative
share of gains/losses of associates recognised in the Statement of
Other Comprehensive Income.
Share-based payment reserve
The share-based payment reserve represents the cumulative charge
for options granted, still outstanding and not exercised.
17. Share capital of the Company
The share capital of the Company is as follows:
2016 2015
Issued and fully paid GBP GBP
----------------------------------------- --------- ---------
1,788,918,926 deferred shares of
GBP0.0009 each - 1,610,027
2,052,990,373 ordinary shares of
GBP0.0001 each - 205,299
124,871,749 ordinary shares of GBP0.0001
each 12,487 -
1,788,918,926 deferred shares of
GBP0.0009 each 1,610,027 -
2,497,434,980 A deferred shares
of GBP0.000095 each 237,256 -
127,512,822 ordinary shares of GBP0.0001
each 12,752 -
----------------------------------------- --------- ---------
As at 30 June 1,872,522 1,815,326
Nominal
Movement in share capital Number GBP
-------------------------------------------- --------------- ---------
Ordinary shares of GBP0.0001 each
As at 30 June 2014 1,475,402,734 1,475,403
Shares issued in the year to 30 June
2015 577,587,639 339,923
-------------------------------------------- --------------- ---------
As at 30 June 2015 2,052,990,373 1,815,326
Issued 20 August 2015 at 0.00045 pence
per share 444,444,600 44,444
As at 23 December 2015, pre-share
re-organisation 2,497,434,973 1,859,770
23 December 2015, Share Re-organisation
(see below)
Issue of deferred shares of GBP0.000095
each (2,497,434,973) (237,256)
Issue of new ordinary shares of GBP0.000005
each (2,497,434,973) (12,487)
Share consolidation: 1 new ordinary
share of GBP0.0001 for 20 ordinary
shares of GBP0.000005 124,871,749 249,743
Issued 06 January 2016 at 0.525 pence
per share 2,285,712 229
Issued 22 February 2016 at 0.325 pence
per share 54,236,919 5,424
Issued 10 March 2016 at 0.6 pence
per share 66,666,667 6,667
Issued 01 April 2016 at 0.425 pence
per share 4,323,524 432
As at 30 June 2016 - ordinary shares
of GBP0.0001 each 252,384,571 1,872,522
-------------------------------------------- --------------- ---------
Change in Nominal Value / share re-organisation
The nominal value of shares in the company was originally 0.1
pence. At a shareholders meeting on 23 December 2015, the Company's
shareholders approved a re-organisation of the company's shares
which resulted in the creation of three classes of shares,
being:
-- Ordinary shares with a nominal value of 0.01 pence, which
will continue as the company's listed securities
-- Deferred shares with a value of 0.09 pence
-- A Deferred shares with a value of 0.0095 pence
Subject to the provisions of the Companies Act 2006, the
deferred shares may be cancelled by the company, or bought back for
GBP1 and then cancelled. These deferred shares are not quoted and
carry no rights whatsoever.
Capital management
Management controls the capital of the Group in order to control
risks, provide the shareholders with adequate returns and ensure
that the Group can fund its operations and continue as a going
concern.
The Group's debt and capital includes ordinary share capital and
financial liabilities, supported by financial assets.
There are no externally imposed capital requirements.
Management effectively manages the Group's capital by assessing
the Group's financial risks and adjusting its capital structure in
response to changes in these risks and in the market. These
responses include the management of debt levels, distributions to
shareholders and share issues.
There have been no changes in the strategy adopted by management
to control the capital of the Group since the prior year.
18. Share-based payments
Employee share options
In prior years, the Company established an employee share option
plan to enable the issue of options as part of the remuneration of
key management personnel and Directors to enable them to purchase
ordinary shares in the Company. Under IFRS 2 "Share-based
Payments", the Company determines the fair value of the options
issued to Directors and employees as remuneration and recognises
the amount as an expense in the Income Statement with a
corresponding increase in equity.
At 30 June 2016, the Company had outstanding options to
subscribe for Ordinary shares as follows:
Options issued
04 June 2016
exercisable
at
0.45 pence
per
share expiring
29 January
2022
Number
----------- ---------------
A R M Bell 2,960,000
S Kaintz 2,820,000
E Bugnosen 560,000
Employees 720,000
----------- ---------------
Total 7,060,000
----------- ---------------
2016 2015
---------------------- -----------------------
Weighted Weighted
average Number average
Number of exercise of exercise
options price options price
Company and Group Number Pence Number Pence
----------------------------- ----------- --------- ------------ ---------
Outstanding at the beginning
of the period - - 13,200,000 3.00
Expired - - (13,200,000) 3.00
Issued 7,060,000 0.45 - -
----------------------------- ----------- --------- ------------ ---------
Outstanding at the end of
the period 7,060,000 0.45 - -
----------------------------- ----------- --------- ------------ ---------
Exercisable at the end of
the period 7,060,000 0.45 - -
----------------------------- ----------- --------- ------------ ---------
During the financial year 7,060,000 options were issued at an
exercise price of 0.45 pence (2015: nil) and they expire on 29
January 2022. A charge of GBP22,945 was posted to the income
statement in respect of the share options issued during the
year.
Share Incentive Plan
The Company operates a tax efficient Share Incentive Plan, a
government approved scheme, the terms of which provide for an equal
reward to every employee, including Directors, who had served for
three months or more at the time of issue. The terms of the plan
provide for:
-- each employee to be given the right to subscribe any amount
up to GBP150 per month with Trustees who invest the monies in the
Company's shares;
-- the Company to match the employee's investment by
contributing an amount equal to double the employee's investment
("matching shares"); and
-- the Company to award free shares to a maximum of GBP3,600 per employee per annum.
The subscriptions remain free of taxation and national insurance
if held for five years.
The fair value of services provided is recognised as an expense
in the Income Statement at grant date and is determined indirectly
by reference to the fair value of the free and matching shares
granted. Fair value of shares is measured on the basis of an
observable market price, i.e. share price as at grant date.
During the financial year, a total of 5,356,296 free and
matching shares were awarded. On 6 January 2016 2,285,712 free
shares with a fair value of 0.00525 pence were awarded, resulting
in a share-based payment charge if GBP12,000 in the income
statement. On 1 April 2016 3,070,584 free and matching shares with
a fair value of 0.00425 pence were awarded, resulting in a
share-based payment charge of GBP13,050 in the income
statement.
Other options
On 22 February 2016, in relation to the Company's investment in
Horse Hill, Angus Energy Plc was granted 17,898,183 options
exercisable at a price of 0.39 pence per share and expiring within
18 months of the day of the grant.
19. Cash and cash equivalents
30 June 30 June
2016 Cash flow 2015
Group GBP GBP GBP
------------------------- ------- --------- -------
Cash in hand and at bank 7,960 4,395 3,565
------------------------- ------- --------- -------
30 June 30 June
2016 Cash flow 2015
Company GBP GBP GBP
------------------------- ------- --------- -------
Cash in hand and at bank 6,626 4,194 2,432
------------------------- ------- --------- -------
20. Financial instruments
20.1 Categories of financial instruments
The Group and Company holds a number of financial instruments,
including bank deposits, short-term investments, loans and
receivables and trade payables.
The carrying amounts for each category of financial instrument,
measured in accordance with IAS 39 as detailed in the accounting
policies, are as follows:
Group 2016 2015
30 June 2016 GBP GBP
------------------------------------------- --------- ---------
Financial assets
Available for sale financial assets
at fair value through other comprehensive
income
Quoted equity shares 7,587 232,572
Available for sale financial assets
at cost
Unquoted equity shares 1,139,873 762,439
Total available for sale financial assets 1,147,460 995,011
Loans and receivables
Trade and other receivables 1,547,127 1,830,683
Total financial assets 2,694,587 2,825,694
------------------------------------------- --------- ---------
Total current 1,547,127 1,830,683
------------------------------------------- --------- ---------
Total non-current 1,147,460 995,011
------------------------------------------- --------- ---------
The carrying value of non-current financial assets in the
Company equals that of the Group. The carrying value of current
financial assets in the Company is higher than that of the Group
mainly due to intercompany debt eliminated at the Group level.
Available for sale financial assets at cost
As at 30 June 2016, GBP1,139,873 of the Group's available for
sale financial assets are valued at cost less impairment due to the
investment being privately held and no quoted market price
information is available. The Group's investment in Direct Nickel
Ltd at 30 June 2016 is valued at GBP215,375 (2015: GBP762,439).
There is currently no intention to dispose of this investment in
the foreseeable future.
During the year the Group made a cash and share investment of
GBP445,000 in the Horse Hill Development. At the year end, and
based on the most recent transactions, this investment has been
revalued to GBP749,498.
During the year the Group made a cash investment of GBP175,000
in Curzon Energy Plc. This investment is currently held at
cost.
Financial instruments held at cost less impairment can be
reconciled from beginning to ending balances as follows:
Unlisted investments
at cost
----------------------
2016 2015
Group and Company GBP GBP
------------------ --------- -----------
Brought forward 762,439 4,188,415
Additions 924,498 -
Disposals - -
Impairment (547,064) (3,425,976)
------------------ --------- -----------
Carried forward 1,139,873 762,439
------------------ --------- -----------
Group 2016 2015
30 June 2016 GBP GBP
---------------------------- ------- -------
Financial liabilities
Loans and borrowings
Trade and other payables 619,139 393,685
Short-term borrowings 282,299 294,990
Total financial liabilities 901,438 688,675
---------------------------- ------- -------
Total current 901,438 688,675
---------------------------- ------- -------
Total non-current - -
---------------------------- ------- -------
Current financial liabilities in the Company are lower than that
of the Group, due to trade and other payables in subsidiary
companies.
Trade receivables and trade payables
Management assessed that other receivables and trade and other
payables approximate their carrying amounts largely due to the
short-term maturities of these instruments.
Borrowings
The carrying value of interest-bearing loans and borrowings is
determined by calculating present values at the reporting date,
using the issuer's borrowing rate.
20.2 Fair values
Financial assets and financial liabilities measured at fair
value in the statement of financial position are grouped into three
levels of a fair value hierarchy. The three levels are defined
based on the observability of significant inputs to the
measurement, as follows:
-- Level 1: Quoted (unadjusted) market prices in active markets
for identical assets or liabilities;
-- Level 2: Valuation techniques for which the lowest level
input that is significant to the fair value measurement is directly
or indirectly observable; and
-- Level 3: Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
The carrying amount of the Group and Company's financial assets
and liabilities is not materially different to their fair value.
The fair value of financial assets and liabilities is included at
the amount at which the instrument could be exchanged in a current
transaction between willing parties, other than in a forced or
liquidation sale. Where a quoted price in an active market is
available, the fair value is based on the quoted price at the end
of the reporting period. In the absence of a quoted price in an
active market, the Group uses valuation techniques that are
appropriate in the circumstances and for which sufficient data are
available to measure fair value, maximising the use of relevant
observable inputs and minimising the use of unobservable
inputs.
The following table provides the fair value measurement
hierarchy of the Group's assets and liabilities:
Level 1 Level 2 Level 3 Total
Group GBP GBP GBP GBP
------------------------------ ------- --------- ------- ---------
30 June 2016
Available for sale financial
assets at fair value through
other comprehensive income
- Quoted equity shares 7,587 - - 7,587
- Unquoted equity shares - 1,139,873 - 1,139,873
------------------------------ ------- --------- ------- ---------
30 June 2015
Available for sale financial
assets at fair value through
other comprehensive income
- Quoted equity shares 232,572 - - 232,572
- Unquoted equity shares - 762,439 - 762,439
------------------------------ ------- --------- ------- ---------
20.3 Financial risk management policies
The Directors monitor the Group's financial risk management
policies and exposures and approve financial transactions.
The Directors' overall risk management strategy seeks to assist
the consolidated Group in meeting its financial targets, while
minimising potential adverse effects on financial performance. Its
functions include the review of credit risk policies and future
cash flow requirements.
Specific financial risk exposures and management
The main risks the Group is exposed to through its financial
instruments are credit risk and market risk consisting of interest
rate risk, liquidity risk, equity price risk and foreign exchange
risk.
Credit risk
Exposure to credit risk relating to financial assets arises from
the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group.
Credit risk is managed through the maintenance of procedures
(such procedures include the utilisation of systems for the
approval, granting and renewal of credit limits, regular monitoring
of exposures against such limits and monitoring of the financial
liability of significant customers and counterparties), ensuring,
to the extent possible, that customers and counterparties to
transactions are of sound creditworthiness. Such monitoring is used
in assessing receivables for impairment.
Risk is also minimised through investing surplus funds in
financial institutions that maintain a high credit rating or in
entities that the Directors have otherwise cleared as being
financially sound.
Trade and other receivables that are neither past due or
impaired are considered to be of high credit quality. Aggregates of
such amounts are as detailed in note 14.
There are no amounts of collateral held as security in respect
of trade and other receivables.
The consolidated Group does not have any material credit risk
exposure to any single receivable or group of receivables under
financial instruments entered into by the consolidated Group.
Liquidity risk
Liquidity risk arises from the possibility that the Group might
encounter difficulty in settling its debts or otherwise meeting its
obligations related to financial liabilities. The Group manages
this risk through the following mechanisms:
-- monitoring undrawn credit facilities;
-- obtaining funding from a variety of sources; and
-- maintaining a reputable credit profile.
The Directors are confident that adequate resources exist to
finance operations to commercial exploration and that controls over
expenditure are carefully managed. All financial liabilities are
due to be settled within the next twelve months.
Market risk
Interest rate risk
The Company is not exposed to any material interest rate risk
because interest rates on loans are fixed in advance.
Equity price risk
Price risk relates to the risk that the fair value or future
cash flows of a financial instrument will fluctuate because of
changes in market prices largely due to demand and supply factors
for commodities, but also include political, economic, social,
technical, environmental and regulatory factors.
Foreign exchange risk
The Group's transactions are carried out in a variety of
currencies, including Australian Dollar, Canadian Dollar, Papua New
Guinea Kina and UK Sterling.
To mitigate the Group's exposure to foreign currency risk,
non-Sterling cash flows are monitored.
21. Significant agreements and transactions
Board Change
On 15 September 2015, John Watkins resigned from the Board of
Directors.
On 1 October 2015, Julian Lee resigned from the Board of
Directors.
Financing
-- On 1 July 2015, the Company raised GBP100,000 by way of an
issue of 139,164,318 new ordinary shares of 0.01 pence each in the
Company to YA Global Master SPV Ltd ("Yorkville") under a SEDA
facility at a price of 0.0719 pence per share.
-- On 20 August 2015, the Company raised GBP200,000 by way of an
issue of 444,444,600 new ordinary shares of 0.01 pence each in the
Company at a price of 0.045 pence per share. For every two new
ordinary shares, each subscriber will be issued with one warrant
exercisable at 0.065 pence per share and expiring on 3 March 2017.
The proceeds of the placing were applied to oil and gas investment
due diligence activities, and for working capital purposes.
-- On 10 March 2016, the Company raised GBP400,000 by way of an
issue of 66,666,667 new ordinary shares of 0.01 pence each in the
Company at a price of 0.6 pence per share. For every three new
ordinary shares, each subscriber will be issued with one warrants
exercisable on the following three dates: 1 July 2016, at an
exercise price of 0.78 pence per share; 1 November 2016, at an
exercise price of 1 pence per share; and 1 February 2017, at an
exercise price of 1.2 pence per share. The proceeds of the placing
was applied to oil activities and for working capital purposes.
Sale of Interests
-- On 22 October 2015, the Company announced that it sold the
whole of its residual 4.23% interest in Alba Mineral Resources plc
("Alba") for net proceeds of GBP91,878. The interest comprised
29,715,006 ordinary shares in Alba which at the mid-market closing
price on 21 October 2015 had a market value of GBP96,574. The sale
represents a GBP17,861 surplus over book cost of GBP74,017.
-- On 25 November 2015, the Company announced that it sold its
remaining 59,516,530 shares in Ram Resources Ltd ("RAM") for a
total consideration of AUD118,437.89. During the year the Company
sold a total of 74,000,000 shares for a total consideration of
GBP188,005.66. The Company retained a 4% carried interest,
convertible into RAM shares at the rate of AUD50,000 per 1% at the
price of any placing, as well as a royalty, in RAM's Fraser Range
Project.
Oil and Gas Co-operation Agreement
On 16 November 2015, the Company announced that it has begun
active co-operation with American Resources Inc aimed at
identifying and pursuing oil and gas investment opportunities in
the Southern United States. The first project is contingent on
satisfactory leasing arrangements and would involve the Company
taking a 50% Working Interest in the planned redevelopment of the
North Francitas Oil project in Jackson and Matagorda Counties
Texas, USA, for an aggregate cost of up to US$ 430,000.
Horse Hill Investment
On 22 February 2016, the Company announced that it signed a
Heads of Agreement (the "Agreement") with Horse Hill Developments
Ltd ("HHDL") for the Company to acquire a 5% interest in HHDL from
Angus Energy Plc ("Angus"). HHDL is a special purpose company that
owns a 65% participating interest in the Petroleum Exploration and
Development Licence 137 ("PEDL 137") as well as the adjacent
licence PEDL 246 in the Weald Basin, UK. The participants in the
Horse Hill -1 well are HHDL as operator with a 65% interest and
Magellan Petroleum Corporation with a 35% interest. The initial
consideration payable by the Company under the HOA was GBP400,000,
to be satisfied as to GBP223,730 in cash, and as to GBP176,270 by
issues of 54,236,919 new ordinary shares in the Company at a price
per share of 0.325 pence. Additionally, the Company granted Angus
17,898,183 options exercisable at a price of 0.39 pence per share
and expiring within 18 months of the day of the grant.
The valuation of the Company's HHDL shares was estimated based
on a general increase in the price of shares sold and bought
through arm's length transactions by various parties since the
Horse Hill project was initiated and in particular by two
transactions that have occurred in 2016 by UK Oil and Gas Plc
("UKOG"). In April 2016 purchased 12% of HHDL from Angus energy for
a total of GBP1.8m or GBP150k per 1% of HHDL. Subsequent to the
Company's 30 June year end a further 6% of HHDL was purchased by
UKOG from Flowermay Ltd for GBP1m, equating to GBP166.7k per 1% of
HHDL. Given the timing of the second transaction post year-end it
has been ignored and instead an uplift equating to GBP150k per 1%
of the Company's stake in HHDL, equating to GBP750k total valuation
has been utilized. This figure has been further adjusted to reflect
the fact that a cash call of GBP54,497.83 was outstanding at
financial year-end. It is important to note that shares in HHDL
remain unlisted and thus relatively illiquid by capital market
standards and thus this analysis must be based on a relatively
small number of transactions.
Wyoming Oil Project
On 9 May 2016, the Company announced that Regency Resource Inc.
("RRI"), a wholly owned subsidiary of the Company, signed a Head of
Agreement ("HOA") with private U.S. oil and gas company ("US
Partner") to bid in an auction process under a Chapter 7 bankruptcy
proceeding for a 75% non-operating working interest (net revenue
interest to the Company of 60%) in an existing well ("Well")
located in the prolific oil producing State of Wyoming. Pursuant to
the HOA, the Company will carry its US partner for a 25% working
interest in the completion of the Well and the next two wells
drilled on the surrounding acreage. Thereafter, the costs will be
met as to 75% by the Company and 25% by the US partner. The Company
budgeted a commitment of under USD1,000,000 for the process and has
agreed to pay the US partner a "prospect fee" of USD100,000 on the
successful acquisition of the interest.
Curzon Energy Plc Investment (Formerly Westport Energy Plc)
On 26 May 2016, the Company announced an investment in Curzon
Energy Plc ("Curzon"), a company formed to acquire natural gas
operations in the United States. The Company agreed to subscribe
for 21,875 new ordinary shares of GBP1.00 per share of Curzon at a
price of GBP8.00 per share for a total consideration of GBP175,000
in a pre-IPO funding. Subsequently, the Curzon shares will be
divided into 100 ordinary shares of GBP0.01 per share. Curzon seeks
a listing on a London market and the Company commits to subscribe
for a further GBP350,000 at a price of GBP0.10 per share ("IPO
Subscription") upon admission of IPO shares. The Company is also to
appoint a director to the Curzon board at the time of the IPO.
Additionally, the Company is to receive additional Curzon shares at
IPO in payment of a 7% fee ("Fee") to be taken in shares in Curzon
in consideration of its entering into a one-year lock in on IPO
Subscriptions and Fee shares.
Munglinup Graphite Disposal
On 14 June 2016, Gold Terrace Pty Ltd, a private Australian
company, and the holder of the Graphite Australia Pty Ltd
tenements, has notified the Company that will issue the Company
with 3,000,000 shares in the capital of the proposed listed
vehicle. This was valued at approximately AUD120,000 against a
carrying value in the books of AUD200,000.
Consolidation of Shares
On 23 December 2015, the Company announced that each of the
existing 2,497,434,980 issued ordinary shares of 0.01 pence each in
the capital of the Company ("Existing Ordinary Shares") will be
subdivided into one A deferred share of 0.0095 pence each ("A
Deferred Shares") and one new ordinary share of 0.0005 pence each.
Furthermore, every 20 ordinary shares of 0.0005 pence each in the
capital of the Company will be consolidated into one new ordinary
shares of 0.01 pence each ("New Ordinary Shares") and accordingly
the Company will have 124,871,749 New Ordinary Shares in issue. The
New Ordinary Shares will have the same rights and be subject to the
same restrictions as the Existing Ordinary Shares in the Company's
Articles of Association and the A Deferred Shares will have the
rights and be subject to the restrictions attached to A Deferred
Shares as set out in the Articles of Association.
Share Incentive Plan
On 12 January 2016, the Board of Directors approved the issue of
2,285,712 ordinary shares of 0.01 pence each in the Company under
the Company's Share Incentive Plan ("SIP") for the 2015/16 tax
year. 2,285,712 Free Shares have been awarded with reference to the
mid-market closing price of 0.525 pence on 6 January 2016.
On 7 April 2016, the Board of Directors approved the issue of
4,323,524 ordinary shares of 0.01 pence each in the Company under
the Company's Share Incentive Plan ("SIP") for the 2015/16 tax
year. 564,704 Free Shares, 1,252,940 Partnership Shares and
2,505,880 Matching Shares have been awarded with reference to the
mid-market closing price of 0.425 pence on 31 March 2016.
22. Commitments
As at 30 June 2016, the Company had entered into the following
commitments:
-- Exploration commitments: On-going exploration expenditure is
required to maintain title to the Group mineral exploration
permits. No provision has been made in the financial statements for
these amounts as the expenditure is expected to be fulfilled in the
normal course of the operations of the Group.
-- The Company has an existing joint lease agreement with Red
Rock Resources plc and Greatland Gold plc relating to Ivybridge
House, 1 Adam Street, London WC2N 6LE. The lease is non-cancellable
until 1 December 2017. Future minimum annual rental and service
charges payable by the Company is GBP38,850.
23. Related party transactions
-- On 5 April 2013, Regency Mines plc, Red Rock Resources plc
where Andrew Bell currently is a Director and Greatland Gold plc,
where Andrew Bell previously was a Director, entered into a joint
lease at Ivybridge House, 1 Adam Street, London WC2N 6LE. The three
companies also share service costs and other outgoings of an
office. The total of these costs charged to Red Rock Resources plc
during the year was GBP110,918 (2015: GBP151,632), of which
GBP44,949 (2015: GBP48,725) represented the Company's share of the
office rent and the balance services provided. Regency charges
Greatland Gold plc fixed quarterly fees for rent and office costs
which totalling GBP24,000 during the year (2015: GBP24,000).
-- The costs incurred by the Company on behalf of Red Rock
Resources plc are invoiced at each month end and settled as soon as
may be possible. By agreement, the Company charges interest at the
rate of 0.5% per month on all balances outstanding at each month
end until they are settled. The total charged to Red Rock Resources
plc for the year was GBP15,869 (2015: GBP16,865).
-- Related party receivables and payables are disclosed in notes 14 and 15, respectively.
-- The Company held 9,084,760 shares (2.32%) in Red Rock Resources plc as at 30 June 2016.
-- The key management personnel are the Directors and their
remuneration is disclosed within note 7.
24. Events after the reporting period
Issue of new shares
-- On 30 August 2016, the Company raised GBP300,000 by way of an
issues of 75,000,000 new ordinary shares of 0.01 pence each in the
Company at a price per share of 0.4 pence. Paul Johnson
participated in GBP75,000 of this placing. The Company has also
granted Paul Johnson the right to join the Board of the Company
upon completion of the full placing. For every one share, each
subscriber will be issued with one warrant exercisable at 0.8 pence
per share and expiring on 11 March 2019.
Sale of interest
-- On 20 September 2016, the Company announced the sale of its
the remaining direct interest of 4% in the Tenements comprising the
Fraser Range Project in Western Australia to Ram Resource ltd for a
total consideration of AUD100,000. Additionally, the Company was
issued the option to purchase 16,666,666 new ordinary shares in Ram
Resource ltd at a price of AUD0.006 per share expiring on 20
September 2020.
Direct Nickel Group - Restructuring
On 21 October 2016, the Company was informed of a restructuring
of the Direct Nickel Group. Previously, the Company held a 6.78%
stake in Direct Nickel Ltd ("DNiL"), which held 100% of Direct
Nickel Holding Pty Ltd ("DNiH"), which held 100% shares in Direct
Nickel Projects Pty Ltd ("DNiP"). After the restructuring, the
Company will own 6.78% in DNiH which in turn holds 40% of DNiP. In
addition to the Company's shareholding DNiH, the Company will also
effectively own a bonus of 0.339% in Planet Minerals Ltd.
Metallurgical Coal - Heads of Terms
On 25 November 2016, the Company announced a Head of Terms to
acquire a 20% shareholding in Carbon Minerals Corporation ("CMC"),
which has entered into an agreement to acquire the Rosa
metallurgical coal mine (the "Rosa Mine") located in Alabama,
United States in the Warrior Coal Basin. The acquisition is for a
total consideration of USD1,650,000 payable monthly plus a royalty
per ton produced. The Company is to pay an initial refundable cash
deposit of GBP50,000 with a further GBP200,000 due after due
diligence and completion of a shareholders' agreement.
Curzon Energy (Formerly Westport Energy Plc)
The Company was informed that the former Westport Energy Plc had
renamed itself Curzon Energy Plc in December 2016.
25. Control
There is considered to be no controlling related party.
26. These results are audited, however the information does not
constitute statutory accounts as defined under section 434 of the
Companies Act 2006. The consolidated statement of financial
position at 30 June 2016 and the consolidated income statement,
consolidated statement of comprehensive income, consolidated
statement of changes in equity and the consolidated cash flow
statement for the year then ended have been extracted from the
Group's 2016 statutory financial statements. Their report was
unqualified and contained no statement under sections 498(2) or (3)
of the Companies Act 2006 but did include an emphasis of matter as
set out below. The financial statements for 2016 will be delivered
to the Registrar of Companies by 31 December 2016.
"The consolidated entity has incurred a loss before tax of
GBP1,965,722 for the year ended 30 June 2016, and has a net cash
outflow of GBP625,634 from operating and investing activities. At
that date there was a net current liability position of GBP548,663.
The loss resulted mainly from provisions taken against the carrying
value of holdings in Direct Nickel Limited and exploration assets
in Sudan.
The consolidated entity continues to be reliant upon completion
of capital raising for continued operations, the provision of
working capital and for the repayment of the GBP282,299 interest
bearing loan due for full settlement in December 2016 and expected
to be financed with the lender with repayments starting later in
2016. Whilst the Directors have instituted measures to preserve
cash and secure additional finance, these circumstances create
material uncertainties over future trading results and cash
flows.
During the fiscal year the Board of Directors has completed the
disposal of its entire investment in Ram Resources for a total
consideration of GBP89,130.36. Further to this the Board has
surrendered its conversion rights of its remaining direct interest
in the Fraser Range project to Ram Resources for a total of
GBP55,386.32.
The Group's cash flow forecast for the 12 months ending 31
December 2017 highlights the fact that the company is expected to
generate negative cash flow through that period. The Board of
Directors are evaluating all the options available, including the
injection of funds into the Group during the next 12 months, and
are confident that the necessary funds will be raised in order for
the Group to remain cash positive for the whole period.
The Directors are confident in the Company's ability to raise
new finance from stock markets if this is required during 2017 and
the Group has demonstrated a consistent ability to do so. This
includes multiple share issuances of 150 million
(post-consolidation) shares for a total consideration of GBP0.876
million during the 2015-16 financial year
If additional equity capital is not obtained, the going concern
basis may not be appropriate, with the result that the Group may
have to realise its assets and extinguish its liabilities, other
than in the ordinary course of business and at amounts different
from those stated in the financial report. The Directors have
concluded that the combination of these circumstances represents a
material uncertainty that casts significant doubt upon the Group's
ability to continue as a going concern. Nevertheless after making
enquiries, and considering the uncertainties described above, the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. For these reasons, they continue to adopt the going concern
basis in preparing the annual report and accounts."
This information is provided by RNS
The company news service from the London Stock Exchange
END
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December 07, 2016 11:54 ET (16:54 GMT)
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