TIDMGDP

RNS Number : 5242W

Goldplat plc

22 December 2021

Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining & Exploration

22 December 2021

Goldplat plc

('Goldplat', the 'Group' or 'the Company')

Audited Results for the year ended 30 June 2021

Goldplat plc, the AIM listed gold producer, with international gold recovery operations located in South Africa and Ghana, is pleased to announce its audited results for the year ended 30 June 2021.

The Company's annual report and accounts, will be available on the Company's website at http://www.goldplat.com/downloads and hard copies will be posted this week to shareholders that have elected to receive printed copies.

As announced on 3 December 2021, the resolution to receive the accounts that was included in the notice of AGM taking place on 31 December 2021 is being adjourned and a further meeting to receive the accounts early in the new year will be convened in due course.

For further information visit www.goldplat.com, follow on Twitter @GoldPlatPlc or contact:

 
 Werner Klingenberg            Goldplat plc               Tel: +27 (0) 82 051 1071 
                                (CEO) 
 Colin Aaronson/George         Grant Thornton UK LLP      Tel: +44 (0) 20 7383 
  M Grainger                    (Nominated Adviser)        5100 
 Jessica Cave / Andrew         WH Ireland Limited         Tel: +44 (0) 207 220 
  de Andrade                    (Broker)                   1666 
 Tim Thompson / Mark Edwards   Flagstaff Strategic and    Tel: +44 (0) 207 129 
  / Fergus Mellon               Investor Communications    1474 
                                                           goldplat@flagstaffcomms.com 
 

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

Chairman's Statement

Goldplat's two precious metals processing facilities, in South Africa and Ghana, have had a productive year to 30 June 2021 achieving very creditable trading results, whilst the planned simplification of the group structure, to which I referred last year, has now largely been completed.

Looking at trading results, profit for the year was GBP2,179,000 (2020 - Loss GBP1,965,000). The improvement reflects the point that the Group is now carrying much reduced material costs of discontinued operations. Looking at like-for-like profitability from continuing operations, profit for the year was GBP2,749,000, as against GBP3,305,000 in 2020. Even though activity levels in 2021 were higher than in 2020, with turnover up 43 per cent. year-on-year, we encountered higher input costs and tighter margins in South Africa in 2021, compensated to a large extent by strong results in Ghana. Cash generation across the Group continued to be robust with net cash flows from operating activities of GBP2,309,000 (2020 - GBP3,380,000) and net year end cash of GBP3,459,000 (2020 - GBP3,146,000).

With regard to the planned simplification of the group structure, we have now: removed the South African operation out of the intermediate Guernsey holding company, thereby reducing materially the Groups' tax cost; increased our holding in the South African operation from 74 per cent. to over 90.63 per cent., thereby increasing the Group's share of its profits; and completed the disposal of the Kilimapesa gold mine for an equity and royalty consideration, thereby removing any requirement to provide funding or management resources. Together, these moves leave us with a profitable, cash generative, precious metals processing business and a clear path for cash surplus to the Group's operational requirements and growth plans to be passed up to shareholders.

There have been a number of changes to the composition of the Board over the last year. We were very pleased to welcome Martin Ooi to the Board in October 2021. Martin has been a substantial and supportive shareholder of the Company for a number of years and his perspective will make a valuable contribution to the Group's strategy. In May 2021, Hansie van Vreden left us as Chief Operating Officer to take up appointment as CEO of a specialist mining services company. Given the depth of the Group's management structure, the disposal of the Kilimapesa gold mine, and the appointment of Ayanda Ntsho, a non-main board finance director, it was concluded that the functions of COO would be absorbed into the existing management structure. Following the AGM held in December 2020, Ian Visagie, who had been a director at the Group's admission to AIM in 2006, ceased to be a director. Earlier this month Nigel Wyatt advised the company of his intention to step down after 8 years as an independent non-executive director, and we thank him for his contribution over those years. Given this, we will now conduct a review to determine the appropriate composition of the Board.

Goldplat operates in a well regulated industry and this regulation includes environmental impact, particularly in terms of air, water and site rehabilitation. We are pleased to note that we qualify for the London Stock Exchange's Green Economy Mark, one of only 48 companies on AIM to be so classified. Operating in South Africa and Ghana, we are also very mindful of our legal and social obligations to operate with the participation of local communities. We are also aware that there is much still to do in terms of firstly analysing, quantifying and reporting on our environmental and social impact and then secondly improving and refining our operations, in a manner which we believe investors will increasingly expect.

The teams in South Africa, Ghana and South America have been as productive as ever in pursuit of Goldplat's strategy notwithstanding the constraints of Covid. I thank all Goldplat's employees, as well as our advisors and my fellow directors, for their efforts as we look forward with enthusiasm.

Matthew Seymour Robinson

Chairman

21 December 2021

Operations and Finance Report

Overview

Goldplat plc is a gold recovery services company with two market leading operations in South Africa and Ghana focused on recovering gold and other precious metals from by-products, contaminated soil and other gold bearing material from mining and other industries, providing an economic method for mines to dispose of waste materials while at the same time adhering to their environmental obligations.

During the prior period, the Company classified its gold mining and exploration portfolio at Kilimapesa in Kenya as a disposal group held for sale and its equity interest in the Anumso exploration project in Ghana as a discontinued operation. During the year under review the sale of Kilimapesa in Kenya was completed, with the Company retaining a holding of a 9.2 per cent. interest indirectly in the project and a 1 per cent. net smelter royalty, capped at USD1.5 million. The mining right in the Anumso exploration project expired during the current period and as indicated, was not renewed.

Goldplat has a JORC defined resource (see the announcement dated 29 January 2016 for further information) over part of its active Tailings Storage Facility ('TSF') at its operation in South Africa of 1.43 million tons at 1.78g/t for 81,959 ounces of gold. Since the resource estimate was made a further 500,000 tons of material have been deposited on the TSF.

Goldplat's extraction processes and multiple process lines enable it to keep materials separate, which provides a high degree of flexibility when proposing a solution for a particular type of material. The processes which are employed include roasting in a rotary kiln, crushing, milling, thickening, flotation, gravity concentration, leaching, CIL, elution and smelting of bullion.

Goldplat recovery operations recover between 1,800 ounces to 2,400 ounces monthly through its various circuits and under different contracts. The grade, recovery, margins and terms of contracts can differ significantly based on the nature of the material supplied and processed. At a minimum, 50 per cent. of material produced is exposed to the fluctuation in the gold price, with the remainder of the production being offset by corresponding changes in raw material costs.

The strategy of the company, which also drives the key performance indicators of management, is to return value to the shareholders by creating sustainable cash flow and profitability through: growing its customer base in South Africa, West Africa and further afield; increasing its ability to process lower grade contaminated material through investing into and improving processing methods; forming strategic partnerships with other industry participants; diversifying into processing of platinum group metals ("PGM") contaminated material; and finding a final deposition site for, and optimising the processing of, the TSF.

Goldplat's highly experienced and successful management team has a proven track record in creating value from contaminated gold and other precious metals-bearing material.

Introduction

During the current period, the Company exited its exploration and mining portfolio and largely completed the process of restructuring and positioning the Group, to optimize the returns to shareholders from its gold recovery businesses in South Africa and Ghana.

During the period, the recovery operations continued to deliver good returns with operations in Ghana increasing its profits from operating activities by 256 per cent. continuing the progress made in developing the market for supply of material in West Africa and supported by supply out of South America. The West African market still has growth potential but remains dependent on getting approval for export of material from neighbouring countries.

The operations in South Africa had another good production period, but its operating results were impacted by a decreasing gold price throughout the year (although they were higher than prior year), and an increase in price of raw material and other costs. It still delivered operating profits for the period of GBP3.22 million on the back of exceptional results in the previous period (2020 - GBP5.62 million). The sustainable profitability was as a result of increasing the customer base and industry relationships during the past

2 periods, investments made into plant improvements, improving operating efficiencies and achieving cost reductions. Additionally, the South African operation has been investing into potential growth areas, specifically through research and analysis of other raw materials for processing and the reprocessing of the TSF material and Platinum Group Metals ('PGM').

The operations throughout the group have benefitted from a strong gold price during the period of USD1,846/oz (2021 - USD1.560/oz). However, the increase in gold price, and specifically the declining exchange rate during the period in South Africa, did contribute to an increase in the cost of raw material and reduction of margins.

The table below on the operating performance of the continuing operations of the group indicates the ability of the recovery operations in South Africa and Ghana to produce profitably at various gold prices and production levels. The margins of the recovery business are exposed to the volume, quality and type of material received, the gold contained in such material, processing methods required to recover the gold, the final recovery of gold from such material, the contracts terms and gold price.

Management's key focus in the recovery operations remains to increase visibility of earnings through growing its customer base and contracted supplying raw material and on site.

 
                                 2021     2020     2019     2018     2017 
    Average Gold Price per 
     oz in 
    US$ for the year            1,846    1,560    1,263    1,293    1,258 
    Average GBP/US Dollar 
     exchange rate for the 
     year                       1.367   1.2603    1.294     1.28   1.2678 
   Average Gold Price per 
    kg in GBP for the year     44,110   39,798   31,377   32,475   31,912 
                              GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
    Revenue                    35,400   24,809   21,769   28,962   28,501 
    Gross Profit                6,614    7,312    3,114    5,703    5,644 
    Administrative expenses   (2,147)  (1,682)    (861)  (1,389)  (1,008) 
----------------------------  -------  -------  -------  -------  ------- 
    Operating Profit before 
    Finance Cost                4,523    5,335    2,253    4,313    4,636 
 

Continued operations

Goldplat Recovery (Pty) Limited - South Africa - ('GPL')

The operations in South Africa had another good production period, but its operating results were impacted by a decreasing gold price, that started off high at the beginning of the financial period and, increases in the price of raw material and other costs. Revenues increased by 10.8 per cent. to GBP17.62 million (2020 - GBP15.9 million), mainly as a result of the increase in the average gold price year-on-year. The profits from operating activities however decreased to GBP3.22 million on the back of exceptional results in the previous period (2020 - GBP5.62 million). The decrease in operating profitability was as a result of increase in raw material cost in the higher gold market as well as other operating costs.

By-products (carbon, woodchips, liners and other by-products)

Consolidation continues in the South African gold industry; mines are closing or are becoming more efficient in their processing, resulting in reduced volumes and grade of by-products received. GPL continued to deliver services to clients signed during previous financial periods and extended its service delivery contract with one of its major suppliers during the period for another 3 years. The risk of supply remains due to the short-term nature of contracts. The focus remains on improving the service provided to the mines, with the aim of increasing the term of the contracts.

Low grade materials

The low-grade material processed through GPL's carbon-in-leach circuits ('CIL') is surface material that has been contaminated by more than 100 years of gold mining in South Africa. The gold grade in this material

is between 1 to 4 grams a ton (average 2 grams per ton). During the period we have maintained the stock of low-grade material available for processing, on contract and on-site to more than 2 years.

With improved mining and processing methods and focus on the environment, significant tonnages of these types of materials are not being generated, and what is being generated, is processed through the mines' own plants before closure. As a result, the quantities of such materials available to GPL will reduce. Nevertheless, GPL believes there are still numerous sources available, although these will be of a lower grade and/or generate lower recoveries.

GPL continue to make changes to its circuit to increase its ability to extract value from these lower grade materials.

During the year under review we installed and completed the following improvements in the plant:

-- We have expanded our pre-treatment facility further through the installation of a jig for GBP94,000, which increased our ability to separate and discard preg-robbing carbons contained in material before the mill, through the use of density medium processes, to enable the company to increase the yield, and improve margins, by processing lower grade material. As a result, we continued to purchase materials of this nature, which are more readily available, which assisted us in maintaining our low-grade materials we currently have on site.

-- A further GBP45,000 was incurred on a rotaspiral to reduce carbon in slurry after the mill and before leaching.

The Company is also currently building a strategic partnership in industry to determine if it could provide a service of doing toll processing for smaller mining operations that do not have sufficient plant capacity, skill and deposition facilities. Inline with this strategy, we agreed, after the end of the financial period, with West Wits Mining Limited (ASX: WWI) to process material from their early mine programme through our plant on a toll treatment basis. The initial programme will last approximately 6 months with material processed through our largest CIL circuit, with the option to extend.

Condition and reprocessing of the TSF

We continued to invest money to monitor, extend and increase capacity within GPL's TSF and incurred GBP118,000 for this purpose. During the period we have also incurred GBP428,000 to do pre-construction of an adjoining TSF whilst we are in the process of applying for permitting. GPL will need to invest a further GBP300,000 during the following financial period in establishing this tailings facility and we expect to finance this from operational cash flow. We have made changes to our water use license application to the Department of Water and Sanitation and resubmitted the application at the end of October 2021. We require the application to be approved to complete the construction of the adjoining TSF and expect this by the end of February 2022 if not sooner.

Through research and development in the prior year, we decided that it will be optimal to reprocess the TSF off-site through a large third-party plant and we submitted an application for environmental approval in October 2021 for the construction of a pipeline, which could provide us with the ability to pump and process material off-site. We estimate that the approval of the application will take approximately 12 months and during this time we will continue discussions with other third parties.

The option of reprocessing the TSF material at our premises remains but this will require us to invest in a new plant and more importantly get an appropriate final deposition site approved and established.

Gold Recovery Ghana Limited - Ghana ('GRG')

GRG focusses on the processing and recovery of gold from mine by-products and serves the industry in Ghana, West Africa, South America and other parts of Africa.

The sourcing efforts in West Africa and further afield continued to benefit the Group through increased supply of material from our current suppliers. The increase in feed material resulted in revenues increasing from GBP8,909,000 during the period to GBP17,778,000. As a result, GRG increased its profitability, posting an operating profit before finance cost of GBP2,574,000 (2020 - GBP724,000). The results for the year continue to reflect the sourcing risk to which GRG is subject.

Due to the lengthy period it takes to extract value from material (60 to 210 days), from when material leaves the mines to when gold is recovered and subsequently sold, GRG obtains financing to settle payment to the mines earlier. The working capital finance cost for the period for GRG was GBP148,000 (2020 - GBP154,000). A further finance cost of GBP110,000 (2020 - GBP125,000) was incurred at Group level to support working capital in Ghana.

Major investments made in Ghana in prior years has positioned GRG well to service its customers.

The following initiatives will continue to manage and reduce the risk of procurement of sufficient materials for Ghana:

-- Expanding the successes achieved in Mali to other mines in Mali, Ivory Coast and Burkina Faso. Some of these efforts have been delayed due to the Covid-19 travel restrictions. In Burkina Faso, the case relating to the export of fine carbon material is still pending and partly delaying any further export of material. Our engagement with mine management and government officials on different levels has continued, with the aim of increasing our footprint to ensure regular supply. Specific progress in this regard has been made during the quarter in Cote d'Ivoire.

-- To support the sourcing and export of material to GRG, subsidiaries have been incorporated in Peru and Brazil during the period, and we will be looking to establish a site in Brazil during the next financial period at an estimated cost of USD300,000, none of which has been committed. This should assist us in increasing our presence and service delivery in South America and specifically allow us to source and process lower grade material, which is not feasible to transport to our other facilities.

-- To reduce the risk to the Ghana operation, we continue to evaluate our options for processing of artisanal tailings material, including the possibility of finding a partner in country, whilst continuing to seek permission from the Minerals Commission to restart in some form the processing and/or tolling of tailings material.

Discontinued operations

Kilimapesa Gold (Pty) Limited - Kenya ('KPG')

The sale of KPG was completed during April 2021 to Mayflower Gold Investments Limited ('Mayflower').

The initial consideration receivable by Gold Mineral Resources Ltd ("GMR"), Goldplat's subsidiary, was in the form of a secured debenture of USD1,500,000, to be satisfied by cash and/or the issue of shares to that value in Papillon Holdings plc ('Papillon') payable on Papillon's re-admission to trading on the LSE following completion of the RTO, with 30 per cent. (USD450,000) of the initial consideration payable in cash.

Subsequent to period end, on 31 August 2021, Papillon Holdings plc, renamed as Caracal Gold plc ("Caracal"), had its ordinary shares commence trading on the Main Market for listed securities of the London Stock Exchange plc ('LSE') under the ticker GCAT with a contemporaneous dual listing on the Frankfurt Stock Exchange, which followed the completion of the reverse takeover of Mayflower Gold. GMR received 103,846,153 shares (which represented 7.17 per cent. of its issued share capital) in Caracal on 31 August 2021, which represented 70 per cent. of the initial consideration of the sale of KPG to Mayflower. On 3 November 2021, the Company agreed with Caracal to take up the remainder of the initial share consideration on the sale of Kilimapesa at the initial listing price of Caracal and as a result, received a further 32 878 000 shares in lieu of a cash payment of US$450,000, increasing the Group's shareholding in Caracal to 9.2 per cent. at the time.

GMR is entitled to receive a further 1 per cent. net smelter royalty on all production from Kilimapesa up to a maximum of $1,500,000, on any future production from Kilimapesa.

During the period the Company has incurred or written-off money outstanding from Kilimapesa to the value of GBP186,000 which has been included under loss from discontinued operations.

Anumso Gold Project - Ghana ('AG')

The gold mining license under the Anumso Gold ('AG') project expired during March 2021 and has not been renewed as was the intention of the Company and the joint venture partner, Desert Gold Ventures Inc. The investment in AG was disclosed as a discontinued operations during the prior year. During the period we

have been informed that mineral right fees since 2013 is outstanding, which is being disputed. None of the joint venture partners has intends to capitalise AG project to settle the claim and current AG liabilities exceed its assets by the minerals right fees outstanding. The Company share of outstanding minerals right fees is GBP369,000 and this has been included under loss from discontinued operations.

Additional financial review

The major functional currencies for the Group subsidiaries are South African Rand (ZAR) and Ghana Cedi (GHS) whilst the presentation currency of the group is Pounds Sterling (GBP).

The average exchange rates for the year are used to convert the Statement of Profit or Loss and Other Comprehensive Income for each subsidiary to Sterling. As set out in the table below, there it can be seen that the average ZAR and GHS weakened against the Pound Sterling, 3.49 per cent. and 10.73 per cent. respectively.

The exchange rate as at end of the period are used to convert the balance in the statement of Financial Position. As per below table, it can be seen that the ZAR strengthened by 7.39 per cent. and the GHS weakened 13.67 per cent. against the Pound Sterling.

 
                                           2021      2020  Variance 
                                            GBP       GBP         % 
South African Rand 
 (ZAR)                            Average  20.73    20.03    -3.49% 
Ghanaian Cedi (GHS)               Average   7.84     7.08   -10.73% 
South African Rand 
 (ZAR)                 As at 30 June 2021  19.80    21.38     7.39% 
Ghanaian Cedi (GHS)    As at 30 June 2021   8.15     7.17   -13.67% 
 

Apart from the gold price the Group's performance is impacted by the fluctuation of its functional currencies against the USD in which a majority of its sales are recognised. The average exchange rates for the year used in the conversion of operating currencies against the USD during the period under review are set out in the table below.

   2021              2020          Variance 
   USD              USD                    % 
 
South African Rand (ZAR)   15.42  15.91  -3.08% 
Ghanaian Cedi (GHS)         5.82   5.61   3.74% 
 

The 27 per cent. increase in the personnel expenses to GBP4,396,000 (2020 - GBP3,446,000) during the period, was mainly as a result of the increase of production personnel in South Africa from 249 to 292. These increases were as a result of additional plant constructed and to be operated and also to manage Covid-19 protocols.

 
The net finance loss/income for the period 
 can be broken into: 
                                                  2021   2020 
Interest component                                '000   '000 
Interest receivable                                  -    174 
Interest payable on lease liabilities             (21)   (10) 
Interest payable on borrowings                   (110)  (124) 
Interest on creditors                            (219)  (270) 
Interest on bank overdraft                        (16)    (6) 
Intercompany foreign exchange (expense)/profit   (513)    971 
Other foreign exchange expense                    (30)  (404) 
Net finance (loss)/Income                        (909)    331 
 

The net finance loss of GBP909,000 (2020 - Income GBP331,000) includes a foreign exchange loss of GBP543,000 (2020 - gain GBP567,000). The large fluctuation in foreign exchange loss and gain from period to period, relate mainly to the intercompany loan between Group subsidiaries and GPL, which is dominated in USD. With the ZAR strengthening against the USD during the current period by 17 per cent., a foreign

exchange loss of GBP882,000 (2020 - gain GBP913,000) was recognized in GPL. The pound Sterling only weakened by 12 per cent. against the USD during the current period resulting in an foreign exchange profit in GMR on conversion of the intercompany loans & receivables of GBP357,000 (2020 - loss of GBP133,000).

The net impact of intercompany balance movement in Group was foreign exchange loss of GBP513,000, against a gain during the previous period of GBP971,000.

The intention of the Group is to reduce intercompany loan balance during the period to reduce the impact of the significant fluctuation between reporting currencies and the currencies loans are denominated in.

During the period the interest payable on borrowings reduced from GBP124,000 to GBP110,000 as a result of repayment of most of the debt during the fourth quarter of the financial year. We have also managed to reduce the interest on creditors through utilisation of our own cash balances during the period, from GBP270,000 to GBP219,000. The increase in interest on lease liabilities, GBP21,000 (2020 - GBP10,000) is as a result in additional machinery procured on this basis in GPL during the period and detail in this regard is disclosed in annual report.

Taxation

As a result of the decrease in the taxable profits and the increase in capital expenditure incurred during the period in GPL, together with the reduction in dividends declared from GPL during the period, the taxation expenses in the Group decreased by 62 per cent. GPL is taxed under a mining tax formula in South Africa, which results in a lower percentage of tax when profits are lower and capital expenditure higher. During the period, GPL was taxed at a percentage of 23.48 per cent. (2020 - 28.98 per cent. ) and recorded a tax expense of GBP435,000 (2020 - GBP712,000) with no tax losses to offset.

GRG is registered as a Free Zone company in Ghana and is currently taxed at the rate of 15 per cent. of taxable profits.

Withholding taxation paid during the period on dividends declared from South Africa, was GBP80,307 (2020 - GBP226,000). The Withholding Taxation Rate changed from 20 per cent. to 5 per cent. during the period as a result of the shareholding of GPL changing from GMR registered in Guernsey to Goldplat Plc (the Company). The withholding tax is not recoverable by the Group.

Other comprehensive income

During the period the Company experienced a gain in foreign exchange translation reserve of GBP966,000 (2020 - Loss of GBP1,394,000). Similar to the prior year, the movement in the reserve was mainly impacted by the fluctuation in the ZAR and Pound Sterling exchange rate between reporting date. Year-on-year the ZAR strengthened by 7.5 per cent. against the pound sterling (after depreciating 19 per cent. during the previous period), resulting in a foreign exchange gain on translation of GPL of GBP984,000 (2020 - Loss of GBP1,882,000).

Property, plant & equipment

The increase in property plant and equipment of GBP1,132,000 during the period was due primarily to:

- The GBP428,000 incurred on the pre-construction of the adjoining tailings facility, together with the GBP78,000 incurred on the monitoring and extension of current tailings facility in GPL;

- The GBP94,000 incurred on the jig to increase our ability to process high carbon, lower grade material;

- The GBP153,000 increase in the environmental asset is as a result of the increase in the environmental provision during the period reflecting the increase in future cost of rehabilitation of operations in South Africa.

No capital expenditure was incurred during the period in GRG.

Intangible Assets

The intangible assets relate to the goodwill in the investment held in GMR. The balance has been assessed for impairment by establishing the recoverable amount through a value-in-use calculation, the detail of which has been disclosed in annual report.

Right-of-use asset

The right-of-use assets increased during the period by GBP218,000, mainly due to the acquisition of heavy-duty vehicles operating at the GPL plant.

The remainder of the changes relate to amortisation for the year and foreign exchange movements as indicated in annual report.

Loan receivable

The GMR loan receivable from the South African minority shareholders on the acquisition of shares are denominated in ZAR. The reduction during the loan period of GBP25,000 relates to the repayment of GBP74,000 from dividends declared by GPL to GMR. The remainder of the movement related to the strengthening of the ZAR against the Pound Sterling by 7.4 per cent.

Subsequent to the end of the period, the outstanding balance was set off in full as part of the share repurchase agreement between GPL and its minorities to repurchase a portion of the minorities share.

Investment in Joint Venture

The gold mining license under the Anumso Gold ('AG') project expired during March 2021 and has not been renewed as was the intention of the Company and the joint venture partner, Desert Gold Ventures Inc. The investment in AG was disclosed as a discontinued operations during the prior year. During the period we have been informed that mineral right fees since 2013 is outstanding, which is being disputed. None of the joint venture partners intends to capitalise AG project to settle the claim and current AG liabilities exceed its assets by the minerals right fees outstanding. The Company share of outstanding minerals right fees is GBP369,000 and have been included under loss from discontinued operations.

Inventories

The increase of GBP2,001,000 in the inventory balance, relates mainly to an increase of GBP1,770,000 in inventory at GPL.

The increase in GPL inventory balance related to:

-- A GBP1,284,000 increase in raw material purchased for the Carbon-In-Leach ('CIL') circuits, which constituted a 65 per cent. increase from the prior period, however the dry tonnage of resources on site only increased by 21 per cent. With the improvements at the pre-treatment facility and the separation of carbonaceous material before the mill, the amount of material processed increased by between 20 per cent. to 25 per cent. on a monthly basis. The increase in raw material is driven by an increase in transport costs, high-grade material purchases and the increase in cost of raw material due to the increase in gold price over the last 18 months.

-- A GBP447,000 increase in precious metals on hand, mainly due to a GBP310,000 increase in gravity concentrates generated in our milling circuits. This is due to higher percentage of gold recovered through our gravity processing units at the time and this gravity material not sold before the end of the year.

The remainder of the increase relates to an increase in precious metals on hand and in process at GRG driven by increase in supply during the year.

Trade and other receivables

The increase of GBP8,527,000 in the trade and other receivable balance, has been primarily as a result of: GPL

-- GBP1,774,000 increase in concentrates at smelters which was driven by increase in percentage of gravity concentrates generated in GPL circuits and processing of build-up supply of low-grade material on our premises during the last quarter.

GRG

-- GBP5,673,000 increase in concentrates at smelters which was driven by high grade batches of material received from suppliers during the 3rd and 4th quarter of the year.

Provisions

In terms of section 54 of the regulations of the Minerals Resource and Petroleum Act of 2002, in South Africa, a Quantum of Financial Provisioning is required for activities performed under mining lease. The Quantum was reassessed the during the current period and increased by GBP204,000. The remainder of the movement of GBP238,000 during the period related to the strengthening of the ZAR against the Pound Sterling by 7.4 per cent.

Deferred tax liabilities

The decrease in the deferred tax liability was as a result of the unrealised foreign exchange loss raised on the GMR intercompany loan with GPL, as a result of the strengthening of the ZAR against the USD during the period. The unrealised loss will only attract tax when it is realised, however the deferred tax liability has been adjusted during the current period. Further to this, the deferred tax liability increases as a result of GBP1,391,000 capital expenditure incurred on the property, plant and equipment and right-for-use assets acquired in GPL during the period, which was amortized fully for tax purposes, although limited depreciation was levied during the prior period on these assets.

Interest bearing borrowings

During the period the Group reduced the interest-bearing borrowings from Scipion by GBP970,000, from GBP1,004,000 to GBP33,000. The remaining balance was settled in full subsequent to year-end and the facility has been cancelled. During the period the borrowings attracted interest of GBP110,000 (2020 - GBP124,000).

Trade and other payables

The increase in trade payables of GBP7,980,000 during the period is linked to the increase in debtors, specifically material delivered at smelters and inventory, specifically material shipped and not yet delivered at smelters, on which funding has been received to enable us to settle suppliers.

As indicated under trade and other payables, the increase linked to high value gravity concentrates produced in the last quarter and high value batches received from suppliers. The funding received is recorded under invoice financing creditor and increased by GBP5,522,000 to GBP6,910,000 during the period.

Contingencies

The Ghana Revenue Authority (GRA) has conducted an audit on the company for the years 2014 to 2018 and is provisionally claiming a remaining GHS5,670,303.99 (GBP723,253) as a result of their review. We have objected this preliminary assessment and have resolved a number of issues but have not been able to get closure on the matter neither have we received a final assessment. We have been engaging with the GRA through our auditor and other legal/tax advisers. At the time of this report we are satisfied that we have accounted for and accrued all taxation liabilities for which the company is liable.

Outlook

As per the outlook of the previous financial period, the focus during the period has been, and will continue to be, on:

   --         finding structures best to return value to shareholders from continued profitability; 

-- investing into research and development to identify different processing methods and equipment to maximize value from sources available;

   --         expanding our environmental services delivery to industry; and 

-- identifying opportunities for growth in the recovery operations by investment into other locations and into additional equipment in our current operation, as well as enhancing operational efficiencies. This should enable the processing of lower grade material at current operations and at different locations closer to the source. Further to the above, we will continue to leverage on relationship in industry to increase long-term visibility through increase of resources and available sources we can process.

The recovery operations have nearly always been cashflow generative and subsequent to the period end we have utilized some of this cashflow to increase the Company's shareholding in GPL and the size of the Group. The Company will remain focused on sharing future cashflows with shareholders, specifically distributing cash surplus to the Group's operational requirements and growth plans to shareholders.

During the 2021 financial period the South African operations will need to complete its investment into a new tailings facility at cost of GBP300,000 and we expect to finance this from operational cash flow.

The focus for Ghana remains on sourcing material from West Africa, South America and the other regions, whilst re-positioning GRG to process lower grade material sourced from within Ghana. In line with this, the Group will establish a site in Brazil to enable it to source and process lower grade material in South America.

The South African operations will continue to serve the South African gold industry and will focus on sustaining profitability from old mining clean-ups and as part of its diversification strategy will invest GBP250,000 of capital into processing PGM's during the period. We will look towards reaching an agreement during the period with a third party in the area to reprocess TSF (which has a JORC Compliant Resource of 81,959 ounces) and receiving environmental approval for a pipeline which will be required to transport material to a facility for processing.

Goldplat recognises the cyclical nature of the recovery operations as well as the risks inherent in relying on short-term contracts for the supply of materials for processing, particularly in South Africa where the gold industry is in slow longer term decline.

These risks can be mitigated by improving our operational capacities and efficiencies to enable us to treat a wider range of lower grade materials and leveraging on our strategic partnerships in industry to increase security of supply. We will continue to see materials in wider geographic areas. We shall also keep looking beyond our current recovery operations for further opportunities to apply our skillsets and resources.

Conclusion

Goldplat's business has always involved change and opportunity, I would like to compliment Goldplat's employees, its advisors, my fellow directors and the Company's shareholders not just for their efforts and support, but for how they have embraced the changes and remained focused on the opportunity it brings. The board is looking forward to building on this year's successes, creating opportunity from the ever-changing environment and returning value to shareholders.

Werner Klingenberg

Director

21 December 2021

 
    Statement of Financial Position                        Group    Group 
    Figures in GBP `000                                     2021     2020 
    Assets 
    Non-current assets 
    Property, plant and equipment                          4,568    3,900 
    Right-of-use assets                                      574      356 
    Intangible assets                                      4,664    4,664 
    Investments in subsidiaries, joint ventures 
     and associates                                            1        1 
    Receivable on Kilimapesa sale                            606        - 
    Other loans and receivables                              636      661 
    Loan to group company                                      -        - 
                                                         -------  ------- 
    Total non-current assets                              11,049    9,582 
                                                         -------  ------- 
    Current assets 
    Inventories                                            8,433    6,432 
    Trade and other receivables                           13,003    4,476 
    Receivable on Kilimapesa sale                             58        - 
    Cash and cash equivalents                              3,459    3,140 
                                                         -------  ------- 
    Total current assets                                  24,953   14,048 
                                                         -------  ------- 
    Non-current assets or disposal groups classified 
     as held for sale                                          -    3,380 
                                                         -------  ------- 
    Total current assets                                  24,953   17,428 
                                                         -------  ------- 
    Total assets                                          36,002   27,010 
                                                         -------  ------- 
    Equity and liabilities 
    Equity 
    Share capital                                          1,698    1,675 
    Share premium                                         11,491   11,441 
    Retained income/(accumulated loss)                     6,846    5,167 
    Foreign exchange reserve                             (5,258)  (6,224) 
                                                         -------  ------- 
    Total equity attributable to owners of the 
     parent                                               14,777   12,059 
                                                         -------  ------- 
    Non-controlling interests                              3,637    3,057 
                                                         -------  ------- 
    Total equity                                          18,414   15,116 
                                                         -------  ------- 
    Liabilities 
    Non-current liabilities 
    Provisions                                               787      549 
    Deferred tax liabilities                                 792      919 
    Lease liabilities                                        110      145 
    Loan from group company                                    -        - 
                                                         -------  ------- 
    Total non-current liabilities                          1,689    1,613 
                                                         -------  ------- 
    Current liabilities 
    Trade and other payables                              15,445    7,465 
    Current tax liabilities                                  128      157 
    Current portion of long term borrowings                   33    1,004 
    Lease liabilities                                        293      206 
    Loan from group company                                    -        - 
                                                         -------  ------- 
    Total current liabilities                             15,899    8,832 
    Liabilities included in disposal groups classified 
     as held for sale                                          -    1,449 
                                                         -------  ------- 
    Total current liabilities                             15,899   10,281 
                                                         -------  ------- 
    Total liabilities                                     17,588   11,894 
                                                         -------  ------- 
    Total equity and liabilities                          36,002   27,010 
                                                         -------  ------- 
 

The financial statements of Goldplat plc, company number 05340664, were approved by the Board of Directors and authorised for issue on 21 December 2021. They were signed on its behalf by: Werner Klingenberg, Director.

Werner Klingeberg

21 December 2021

Statement of Profit or Loss and Other Comprehensive Income

   Group             Group 

Figures in GBP `000 2021 2020

Revenue

     35,400             24,809 

Cost of sales

   (29,201)          (17,497) 

Gross profit

        6,199              7,312 

Other income 56 -

Administrative expenses

(1,694)            (1,682) 

Impairment loss

             -              (295) 

Profit/(loss) from operating activities 4,561

5,335

Finance income

            -              1,067 

Finance costs

       (909)              (736) 

Profit/(loss) before tax

   3,652              5,666 

Income tax expense - continuing operations (903)

(2,361)

Profit/(loss) from continuing operations 2,749

3,305

Loss from discontinued operations

(570)            (5,270) 

Profit/(loss) for the year

    2,179            (1,965) 

Profit/(loss) for the year attributable to:

Owners of Parent

      1,679            (3,137) 

Non-controlling interest

        500              1,172 
   2,179            (1,965) 

Other comprehensive income net of tax

Components of other comprehensive income that will be reclassified to profit or loss

Exchange differences on translation relating to the parent

Gains/(losses) on exchange differences on translation 719

(1,394)

   Exchange reserve reclassified on loss of control of Kilimapesa                                  247 

-

Total Exchange differences on translation 966

(1,394)

Exchange differences relating to the non-controlling interest

Gains/(losses) on exchange differences on translation 256

(488)

Total other comprehensive income that will be reclassified

to profit or loss

        1,222             (1,882) 

Total other comprehensive income net of tax 1,222

(1,882)

Total comprehensive income

3,401             (3,847) 

Comprehensive income attributable to:

Comprehensive income, attributable to owners of parent 2,645 (4,531)

   Comprehensive income, attributable to non-controlling interests                                 756 

684

   3,401             (3,847) 

Earnings per share from continuing and discontinuing operations attributable to

owners of the parent during the year

Basic earnings per share

Basic earnings per share from continuing operations 1.32

1.27

Basic loss per share from discontinuing operations (0.34)

(3.15)

Total basic earnings/(loss) per share 0.98 (1.87)

Diluted earnings per share

Diluted earnings per share from continuing operations 1.32

1.25

Diluted loss per share from continuing operations (0.33)

(3.12)

Total diluted earnings/(loss) per share 0.99 (1.88)

 
  Statement of 
  Changes in                                              Foreign       Retained   Attributable 
  Equity - Group                                         currency        income/      to owners      Non- 
  Figures in              Share           Share       translation   (accumulated         of the   controlling 
  GBP'000                Capital          premium         reserve          loss)         parent    interests     Total 
 Balance at 1 
  July 2019                1,675           11,441         (4,830)          8,282         16,568         2,717   19,285 
 Changes in 
 equity 
 Loss for the 
  year                         -                -               -        (3,137)        (3,137)         1,172  (1,965) 
 Other 
  comprehensive 
  income                       -                -         (1,394)                       (1,394)         (488)  (1,882) 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 Total 
  comprehensive 
  income for the 
  year                         -                -         (1,394)        (3,137)        (4,531)           684  (3,847) 
 Non-controlling 
  interests in 
  subsidiary 
  dividend                     -                -               -              -              -         (344)    (344) 
 Share based 
  payments                     -                -               -             22             22             -       22 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 Balance at 30 
  June 2020                1,675           11,441         (6,224)          5,167         12,059         3,057   15,116 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 Balance at 1 
  July 2020                1,675           11,441         (6,224)          5,167         12,059         3,057   15,116 
 Changes in 
 equity 
 Profit for the 
  year                         -                -               -          1,679          1,679           500    2,179 
 Other 
  comprehensive 
  income                       -                -             719              -            719           256      975 
 Exchange reserve 
  released 
  through profit 
  and loss on 
  sale of 
  Kilimapesa                   -                -             247              -            247             -      247 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 Total 
  comprehensive 
  income for the 
  year                         -                -             966              -          2,645           756    3,401 
 Non-controlling 
  interests in 
  subsidiary 
  dividend                     -                -               -              -              -         (176)    (176) 
 Shares issued 
  from options 
  exercised                   23               50               -              -             73             -       73 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 Balance at 30 
  June 2021                1,698           11,491         (5,258)          6,846         14,777         3,637   18,414 
                   -------------  ---------------  --------------  -------------  -------------  ------------  ------- 
 
 
    Statement of Cash Flows                                   Group    Group 
    Figures in GBP'000                                         2021     2020 
    Net cash flows from/(used in) operations                  4,277    4,774 
    Finance cost                                              (909)    (736) 
    Finance income                                                -    1,067 
    Income taxes paid                                       (1,059)  (1,725) 
----------------------------------------------------------  -------  ------- 
    Net cash flows from/(used in) operating activities        2,309    3,380 
----------------------------------------------------------  -------  ------- 
    Cash flows (used in)/from investing activities 
    Proceeds from sales of property, plant and equipment         18        9 
    Purchase of property, plant and equipment                 (979)    (356) 
    Decrease in cash from disposal of non-current assets 
     held for sale                                              (6)        - 
    Receipt from long term receivable                            74      156 
    Decrease/(Increase) of loans to subsidiary                    -        - 
----------------------------------------------------------  -------  ------- 
    Cash flows (used in)/from investing activities            (893)    (191) 
----------------------------------------------------------  -------  ------- 
    Cash flows (used in)/from financing activities 
    Proceeds from drawdown of interest-bearing borrowings         -      973 
    Net (repayment) from debt financing (included under 
     trade and other payables)                                    -  (1,490) 
    Net proceeds from issuing of shares                          73        - 
    Repayment of interest-bearing borrowings                  (872)    (394) 
    Interest paid on interest-bearing borrowings               (99)    (127) 
    Principal paid on lease liabilities                       (186)    (151) 
    Interest paid on lease liabilities                         (21)     (40) 
    Payment of dividend by subsidiary to non-controlling 
     interest                                                          (344) 
    Payment of dividend to non-controlling interest           (176)        - 
----------------------------------------------------------  -------  ------- 
    Cash flows (used in)/from financing activities          (1,281)  (1,573) 
----------------------------------------------------------  -------  ------- 
    Net increase in cash and cash equivalents                   135    1,616 
    Cash and cash equivalents at beginning of the year        3,146    1,807 
    Foreign exchange movement on opening balance                178    (277) 
----------------------------------------------------------  -------  ------- 
    Cash and cash equivalents at end of the year              3,459    3,146 
----------------------------------------------------------  -------  ------- 
    Cashflows from discontinued operations                     -        5 
 
 

Notes to the Accounts

   1.     Basis of preparation and summary of significant accounting policies 

Statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRSs") as issued by the International Accounting Standards Board ("IASB") , and the Companies Act 2006 as applicable to entities reporting in accordance with IFRS.

Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis, except for derivative financial instruments that have been measured at fair value.

Functional and presentation currency

These consolidated financial statements are presented in Pounds Sterling ("GBP"), which is considered by the directors to be the most appropriate presentation currency to assist the users of the financial statements. All financial information presented in GBP has been rounded to the nearest thousand, except when otherwise indicated.

The Group's subsidiaries' functional currency is considered to be the South African Rand (ZAR), Ghana Cedi (GHS) and the Kenyan Shilling (KES) and the Company's functional currency is Pounds Sterling (GBP) as these currencies mainly influences sales prices and expenses.

Use of estimates and judgements

The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period, or in the period of revision and future periods of the revision if it affects both current and future periods.

Critical estimates and assumptions that have the most significant effect on the amounts recognised in the consolidated financial statements and/or have a significant risk of resulting in a material adjustment within the next financial year are as follows:

   -      Carrying value of goodwill to the value of GBP4,664,000 (2020: GBP4,664,000) 

- Inventory - precious metals on hand and in process to the value of GBP4,303,000 (2020: GBP3,799,000)

   -      Rehabilitation provision GBP787,000 (2020: GBP549,000) 
   -      Useful economic lives 
 
2. Share capital 
 2.1 Authorised and issued share capital    Group   Group 
       Figures in GBP'000                    2021    2020 
       Issued 
       Ordinary shares                      1,698   1,675 
                                           ------  ------ 
                                            1,698   1,675 
                                           ------  ------ 
       Share premium                       11,491  11,441 
                                           ------  ------ 
                                           13,189  13,116 
                                           ------  ------ 
2.2 Additional disclosures 
 

During the current year, additional shares were issued to current shareholders resulting in an increase in share capital and premium. The transactions are detailed below:

   Share             Share 
   Capital        Premium 

Director Date Movement Movement

Hansie van Vreden 3 July 2020 10,000 21,250

Gerard Kisbey Green 3 July 2020 13,333 28,333

2.3 Reserves

Nature and purpose of reserves

Ordinary shares

All shares rank equally with regard to the Company's residual assets. The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.

Share premium

Represents excess paid above nominal value on historical shares issued.

Exchange reserve

The exchange reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

Non-controlling interest

Relates to the portion of equity owned by minority shareholders.

   3.     Employee benefits expense 

Non-

Directors emoluments Executive executive Total

2021

Wages and salaries 407 407

Fees 103 103

Other benefits 9 9

Total 416 103 519

2020

Wages and salaries 404 404

Fees 83 83

Other benefits 10 10

Total 414 83 497

Emoluments disclosed above include the following amounts paid to the highest director:

   2021               2020 

Emoluments for qualifying services 168 164

   4.     Earnings per share 
   4.1   Basic earnings per share 
   Group             Group 

Figures in GBP'000 2021 2020

The earnings and weighted average number of ordinary shares

used in the calculation of basic earnings per share are as follows:

Earnings used in the calculation of basic earnings per share for

continuing operations 2,249 2,133

Weighted average number of ordinary shares used in the calculation of

basic earnings per share 169,774 167,441

The earnings used in the calculation of diluted earnings per share

are as follows:

The earnings used in the calculation of basic earnings per share for

continuing operations 2,249 2,133

Earnings used in the calculation of basic earnings per share for

continuing operations (570) (570)

The weighted average number of ordinary shares for the purpose of

diluted earnings per share reconciles to the weighted average number

of ordinary shares used in the calculation of basic earnings

per share as follows:

Weighted average number of ordinary shares used in the calculation

of basic earnings per share 169,774 167,441

Adjusted for

- Dilutive effect of share options 787 3,120

Weighted average number of ordinary shares used in

the calculation of diluted earnings per share 170,561 170,561

 
   5. Related parties 
    Other related parties 
    Entity name                                                  Holding 
    Gold Mineral Resources Limited                                  100%    Direct 
    Goldplat Recovery (Pty) Ltd                                      74%    Direct 
    Goldplat Ghana Limited                                          100%    Direct 
    Anumso Gold Limited                                             100%    Direct 
    Nyieme Gold SARL                                                100%    Direct 
    Midas Gold SARL                                                 100%    Direct 
    Gold Recovery Brasil Recuperacao                                100%  Indirect 
    Gold Recovery Peru SAC                                          100%  Indirect 
    GRG Tolling Ltd                                                 100%  Indirect 
    Major inter-company transactions 
                                          Nature of transaction     2021      2020 
    Goldplat Recovery to Gold Recovery         Goods, equipment 
     Ghana                                                  and 
                                              services supplied      332       103 
    Goldplat Recovery to Gold Mineral          Goods, equipment 
     Resources                                              and 
                                              services supplied      136        45 
    Goldplat Recovery to Gold Mineral 
     Resources                                Interest received    (125)     (166) 
    Goldplat Recovery to NMT Capital            Management fees        4        25 
    Goldplat Recovery to NMT Group             Managements fees        9        12 
    Goldplat Plc to Gold Mineral 
     Resources                                  Management fees      413       322 
    Goldplat Plc                                      Directors       98        83 
 

Related Party Transactions with Mr Sango Ntsaluba

Subsequent to the year-end, the directors decided to increase the Group's interest in GPL, its principal operating subsidiary, from 74 per cent. to 90.63 per cent. through the buy-back by GPL of GPL shares from its minority shareholders. GPL has issued 4.90 per cent. shares in GPL (after the share repurchase) to Aurelian, a company controlled by Mr Sango Ntsaluba, in order to maintain a BEE partner in GPL and to reduce the cost to the Group of the share repurchase transaction.

After the completion of above transactions and cancellation of the repurchased shares, the Group held 90.63 per cent. of GPL (an increase of 16.63 per cent. ), Amabubesi held 4.47 per cent. and Aurelian 4.90 per cent. . Subsequent to above, Amabubesi's remaining shares were repurchased and shares to the same amount and value issued to Aurelian. Aurelian is therefore the only minority partner in South Africa and holds 9.37 per cent. of GPL.

By virtue of their size and because Mr Ntsaluba is both a director of Goldplat and a major shareholder of Amabubesi and Dartingo, both the share repurchases by GPL of 22.33 per cent. of shares held by Amabubesi and Dartingo and the subsequent issue by GPL of shares to Aurelian constituted related party transactions under Rule 13 of the AIM Rules for Companies. The independent directors, being the Goldplat board members with the exception of Mr Ntsaluba, consider, having consulted with the Company's Nominated Adviser, Grant Thornton UK LLP, that the terms of the transactions were fair and reasonable insofar as Goldplat's shareholders are concerned.

6. Subsequent events

Share repurchase of minority shareholding in GPL

The directors decided after the period end, 20 July 2021, to increase the Group's interest in GPL, its principal operating subsidiary, from 74 per cent. to 90.63 per cent. through the buy-back by GPL of GPL shares from its minority shareholders ("the Transaction").

GPL had two minority shareholders, Amabubesi Property Holdings Proprietary Limited ("Amabubesi") and Dartingo Trading 161 Proprietary Limited ("Dartingo"), who respectively held an 11 per cent. and a 15 per cent. interest in GPL. Following a notification received from the two minority shareholders indicating their intention to dispose of their shareholdings, GPL did agree to repurchase all of the Dartingo shareholding and 7.33 per cent. of the shares held by Amabubesi for ZAR 89.3 million (approximately GBP4.5 million).

Amabubesi and Dartingo are companies connected with Goldplat's Non-Executive Director, Mr Sango Ntsaluba. Subsequent to the Transaction, GPL issued to Aurelian Capital Proprietary Limited ("Aurelian"), a company associated with Mr Ntsaluba, shares amounting to 4.90 per cent. of GPL, at the same valuation as the share repurchase, for ZAR 16 million (approximately GBP807,000) as described further below. As a result of the Transaction, Goldplat will own 90.63 per cent. of GPL and Mr Ntsaluba will own, directly and indirectly, 9.37 per cent. of GPL.

The consideration for the repurchased shares of ZAR 89.3 million (approximately GBP4.5 million) was settled in two instalments. The net cost to GPL of the Transaction was ZAR 73.4 million (approximately GBP3.7 million), and Goldplat's share of the net cost of the Transaction to GPL was be 90.63 per cent. , effectively resulting in its additional 16.63 per cent. interest in GPL costing Goldplat ZAR 66.52 million (approximately GBP3.35 million).

The Transaction valued GPL at ZAR 400 million (approximately GBP20.2 million).

Funding Arrangements

The Transaction were financed in part through a South African Rand denominated bank facility of ZAR 60 million (approximately GBP3.02 million) provided by Nedbank, of which 50 per cent. was drawn within the 30 days and the remainder in 90 days. The remainder of the consideration was settled through a set-off against the existing Amabubesi vendor loan of ZAR 12.6 million (approximately GBP635,000) outstanding to the Group with the balance paid in cash.

The principal on the bank facility is repayable monthly over 36 months. The interest payable on the facility will be the South African Prime Rate plus 1.75 per cent. .

As a condition of the facility from Nedbank, the Group's facility with Scipion, of GBP33,000, were settled in full and its securities over GPL will be cancelled. Further to above, GPL did grant security over its debtors as well as a negative pledge over its moveable and any immovable property and a general notarial bond over all movable assets of GPL will be registered. The Group entered into a limited suretyship for ZAR 60 million (approximately GBP3.02 million), in favour of Nedbank.

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