28 February 2020
Karelian Diamond
Resources plc
(“Karelian” or “the Company”)
Half-yearly
results for the six months ended 30 November
2019
Karelian Diamond Resources plc (AIM: KDR), the diamond
exploration company focused on Finland, announces its unaudited results for
the six months ended 30 November 2019. Details of these can
be found below and a full copy of the statement can be viewed on
the Company’s website.
Highlights of the half-year period
included:
- Presence of coloured stones including pink diamonds confirmed
at the Lahtojoki diamond deposit. Examination of the pink diamonds
indicates that these diamonds are of high quality and therefore
potentially especially valuable.
- The process in relation to compensation for landowners at
Lahtojoki is now at an advanced stage.
- Material from kimberlite boulders to the south of the Lahtojoki
diamond deposit indicate that the boulders may come from an
undiscovered kimberlite up ice. The Company has been granted
an exploration permit over the relevant area.
- Exploration work is also continuing in the Kuhmo region of
Finland.
- Howard Bird joined the Board of
the Company as a Non-Executive Director and will also continue in
his role as a geoscience consultant.
Professor Richard Conroy, Chairman of Karelian, said:
“Despite the distraction of the EGMs
being called the Company has made further progress with the
Lahtojoki Diamond Mining Project and continued to carry out further
exploration work at both Lahtojoki and in the Kuhmo region. I am
particularly pleased with the very encouraging news in regard to
pink diamonds at Lahtojoki.”
For further
information please contact:
Karelian Diamond
Resources plc |
Tel:
+353-1-479-6180 |
Professor Richard
Conroy, Chairman |
|
Allenby Capital
Limited(Nomad) |
Tel:
+44-20-3328-5656 |
Nick Athanas/Nick
Harriss |
|
Brandon Hill
Capital Limited (Broker) |
Tel:
+44-20-3463-5000 |
Jonathan
Evans |
|
Lothbury
Financial Services |
Tel:
+44-20-3290-0707 |
Michael
Padley |
|
Hall
Communications |
Tel:
+353-1-660-9377 |
Don Hall |
|
www.kareliandiamondresources.com
|
|
CHAIRMAN’S STATEMENT
I have great pleasure in presenting the Company’s half-yearly
report for the six months ended 30 November
2019. During the period the Company continued to advance its
diamond mining project at Lahtojoki in the Kaavi region and its
successful diamond exploration programme in the Kuhmo region, both
in Eastern Finland. During the
half year Howard Bird, a
distinguished geoscientist who has wide experience in the diamond
industry, joined the Board of the Company as a non-executive
director.
The Lahtojoki Diamond Deposit
Progress has continued to be made in relation to the assessment
and permitting of the Lahtojoki diamond deposit, which the Company
acquired in the Kaavi region of Eastern
Finland, and which, if developed, will not only be the
Company’s first diamond mine but the first diamond mine in
Europe (outside Russia).
A particularly interesting feature of the Lahtojoki deposit is
the presence of coloured stones and especially of pink diamonds.
Analysis of available data and reports suggests that these coloured
stones could amount to as much as seven per cent of the diamond
content of the Lahtojoki deposit and that perhaps three per cent
could be pink diamonds. Examination of the pink diamonds made
available for inspection by the Company, together with photographs
of diamonds from the deposit, indicates that these diamonds are of
high quality.
The importance of the pink diamonds may be put into context when
one considers that pink diamonds, although only accounting for less
than five per cent of the world’s biggest diamond mine, Argyll in
Western Australia, account for
nearly fifty per cent of its revenue.
Progress in relation to mandatory regulatory matters under the
Finnish mining laws continued to be made. In particular, the
process in relation to agreeing compensation for landowners at
Lahtojoki is now at an advanced stage.
Diamond Exploration
Kimberlite boulders discovered to the south of the Lahtojoki
diamond deposit are comprised of material which does not appear to
be derived from the Lahtojoki kimberlite. This suggests that these
boulders may come from an undiscovered kimberlite up ice. The
Company therefore applied for an exploration permit over the
relevant area and has been informed that this has become legally
valid. The possible existence of a further diamondiferous
kimberlite nearby, if confirmed, would, in the Board’s view,
further increase the attractiveness of the Lahtojoki diamond
deposit.
Exploration is also continuing in the Kuhmo region of
Finland where the Company has
already discovered a diamond in till, a very rare event, and, of
course, the best possible kimberlite indicator. The Company
has also discovered a new kimberlite body, at Riihivaara, and is
following up on the large series of other kimberlite anomalies
which it has discovered in the region.
Board Appointment
I am delighted to report that in September 2019, Howard
Bird joined the Board of the Company as a Non-Executive
Director. This is in addition to his previously announced role as a
geoscience consultant to the Company which will continue. Mr Bird
is an internationally experienced geoscientist who has been
involved in the discovery through to production success of several
new economic diamond deposits.
In December 2019 and post period
end, Louis Maguire did not stand for
re-election at the Company’s Annual General Meeting and retired
from the Board.
Extraordinary General Meetings
The Company has, since just before the beginning of the half
year, had to contend with a series of actions by a group of
shareholders which have hindered the Board of Directors and
management from pursuing the Company’s business objectives as
planned during the period.
These actions culminated in the holding of two separate
Extraordinary General Meetings (“EGMs”) in July 2019 and October
2019 following requisitions being received from these
shareholders. The requisitionists, in association with a former
employee/consultant to the Company, endeavoured to gain control of
the Company by removing all but two of the current members of the
Board and electing four replacements, nominated by them, to the
Board.
The resolutions were rejected by shareholders of the Company at
the first EGM and the same resolutions were defeated by an even
larger majority at the second EGM.
Finance
The loss after taxation for the half year ended 30 November 2019 was €250,150 (for the six-month
period ended 30 November 2018:
€215,342) and the net assets as at 30
November 2019 were €9,177,513 (30
November 2018: €9,345,090).
During the period the Company raised a total of €150,000 through
two subscriptions. In addition, I converted loans amounting to
€71,425 into equity.
Post period a subscription and issue of a convertible loan note
raised a total of £240,000. This subscription and issue of
convertible loan note was subscribed by a new investor Fredrik
Björnberg.
Mr Björnberg, qualified in geology, was involved in the early
stages of the discovery of the Lahtojoki diamond deposit and is a
member of a prominent family in Finland with a range of business activities.
The Björnberg family previously owned the Luikonlahti copper mine
in the Kaavi area and still have close connections with this part
of Finland.
Directors and Staff
I would like to welcome Howard
Bird to the Board. I would also like to express my deep
appreciation for the support and dedication of my fellow directors,
staff and consultants which has enabled the continued success of
the Company.
I would particularly wish to express my appreciation and thanks
to Louis Maguire who did not seek
re-election as a director of the Company at the Annual General
Meeting held in December 2019. Louis
was a founding director of the Company and played a major role in
its development and success.
Outlook
The Company has continued to progress in the period under review
and I look forward with confidence to further success during the
coming period.
Condensed income
statement and condensed statement of comprehensive income
for the six month
period ended 30 November 2019
Condensed income
statement |
|
|
|
|
|
|
|
Note |
Six month
period ended 30 November 2019
(Unaudited) € |
|
Six
month period ended 30 November 2018
(Unaudited) € |
|
Year
ended 31 May 2019
(Audited) € |
Continuing operations |
|
|
|
|
|
|
Operating expenses |
|
(250,150) |
|
(215,342) |
|
(370,654) |
|
|
|
|
|
|
|
Loss before taxation |
|
(250,150) |
|
(215,342) |
|
(370,654) |
|
|
|
|
|
|
|
Income tax expense |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
Loss for the financial
period/year |
|
(250,150) |
|
(215,342) |
|
(370,654) |
|
|
|
|
|
|
|
Loss per share |
|
|
|
|
|
|
Basic and diluted loss per
share |
2 |
(€0.0069) |
|
(€0.0064) |
|
(€0.0109) |
|
|
|
|
|
|
|
|
|
|
|
|
Condensed
statement of comprehensive income
|
|
Six month period ended
30 November 2019
(Unaudited) € |
|
Six month period
ended 30 November 2018
(Unaudited) € |
|
Year ended 31 May
2019
(Audited) € |
|
|
|
|
|
|
|
Loss for the financial
period/year |
|
(250,150) |
|
(215,342) |
|
(370,654) |
|
|
|
|
|
|
|
Income/expense recognised in other
comprehensive income |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
Total comprehensive expense for
the financial period/year |
|
(250,150) |
|
(215,342) |
|
(360,654) |
The accompanying notes form an
integral part of these condensed financial statements.
Condensed statement of financial position
as at 30 November 2019
|
Note |
30 November 2019
(Unaudited) |
|
30 November 2018
(Unaudited) |
|
Year ended 31 May
2019 (Audited) |
|
|
€ |
|
€ |
|
€ |
Assets |
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
Intangible assets |
3 |
10,282,861 |
|
9,967,646 |
|
10,152,733 |
Financial assets |
|
4 |
|
4 |
|
4 |
Total non-current
assets |
|
10,282,865 |
|
9,967,650 |
|
10,152,737 |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash
equivalents |
|
20,901 |
|
198,692 |
|
30,833 |
Other receivables |
|
13,254 |
|
166,655 |
|
102,989 |
Total current
assets |
|
34,155 |
|
365,347 |
|
133,822 |
|
|
|
|
|
|
|
Total assets |
|
10,317,020 |
|
10,332,997 |
|
10,286,559 |
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Capital and
reserves |
|
|
|
|
|
|
Called up share
capital |
|
10,010 |
|
8,622 |
|
8,622 |
Called up deferred
share capital |
|
3,174,672 |
|
3,174,672 |
|
3,174,672 |
Share premium |
|
9,005,750 |
|
8,768,276 |
|
8,768,276 |
Share based payments
reserve |
|
456,624 |
|
525,124 |
|
456,624 |
Retained losses |
|
(3,469,543) |
|
(3,131,604) |
|
(3,218,415) |
Total equity |
|
9,177,513 |
|
9,345,090 |
|
9,189,779 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
Trade and other payables: amounts
falling due after more than one year |
5 |
93,662 |
|
158,008 |
|
158,087 |
Total non-current
liabilities |
|
93,662 |
|
158,008 |
|
158,087 |
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Trade and other
payables: amounts falling due within one year |
|
1,045,845 |
|
829,899 |
|
938,693 |
Total current
liabilities |
|
1,045,845 |
|
829,899 |
|
938,693 |
|
|
|
|
|
|
|
Total liabilities |
|
1,139,507 |
|
987,907 |
|
1,096,780 |
|
|
|
|
|
|
|
Total equity and
liabilities |
|
10,317,020 |
|
10,332,997 |
|
10,286,559 |
Condensed statement of cash flows
for the six month period ended
30 November 2019
|
Six month period ended
30 November 2019 (Unaudited) € |
|
Six month period
ended 30 November 2018 (Unaudited) € |
|
Year ended 31 May
2019 (Audited)
€ |
Cash flows from operating
activities |
|
|
|
|
|
Loss for the financial
period/year |
(250,150) |
|
(215,342) |
|
(370,654) |
Adjustments for: |
|
|
|
|
|
Expense recognised in income
statement in respect of equity settled share based payments |
- |
|
5,965 |
|
5,966 |
Increase in trade and other
payables |
77,133 |
|
116,730 |
|
225,524 |
Decrease in other receivables |
89,735 |
|
70,827 |
|
79,974 |
Net cash used in operating
activities |
(83,282) |
|
(21,820) |
|
(59,190) |
|
|
|
|
|
|
Cash flows from investing
activities |
|
|
|
|
|
Investment in exploration and
evaluation |
(130,128) |
|
(306,087) |
|
(491,174) |
Net cash used in investing
activities |
(130,128) |
|
(306,087) |
|
(491,174) |
|
|
|
|
|
|
Cash flows from financing
activities |
|
|
|
|
|
Issue of share capital |
238,862 |
|
569,390 |
|
534,988 |
Share issue costs |
(978) |
|
(31,390) |
|
(31,390) |
Shareholder’s loan
advances/(repayments) |
7,000 |
|
(34,481) |
|
148,293 |
Shareholder’s loan converted |
(71,425) |
|
- |
|
- |
Advances from/(repayments to) Conroy
Gold and Natural Resources P.L.C. |
30,019 |
|
4,377 |
|
(89,397) |
Net cash provided by financing
activities |
203,478 |
|
507,896 |
|
562,494 |
|
|
|
|
|
|
(Decrease)/increase in cash and
cash equivalents |
(9,932) |
|
179,989 |
|
12,130 |
Cash and cash equivalents at
beginning of financial period/year |
30,833 |
|
18,703 |
|
18,703 |
Cash and cash equivalents at end
of financial period/year |
20,901 |
|
198,692 |
|
30,833 |
Condensed statement of changes in
equity
for the six month period ended
30 November 2019
|
Share
capital (including deferred share capital) |
Share
premium |
Share-based payment reserve |
Retained
losses |
Total
equity |
|
€ |
€ |
€ |
€ |
€ |
Balance at 1 June
2019 |
3,183,294 |
8,768,276 |
456,624 |
(3,218,415) |
9,189,779 |
Issue of share
capital |
1,388 |
237,474 |
- |
- |
238,862 |
Share issue costs |
- |
- |
- |
(978) |
(978) |
Share based
payments |
- |
- |
- |
- |
- |
Loss for the financial
period |
- |
- |
- |
(250,150) |
(250,150) |
Balance at 30
November 2019 |
3,184,682 |
9,005,750 |
456,624 |
(3,469,543) |
9,177,513 |
|
|
|
|
|
|
Balance at 1 June
2018 |
3,180,516 |
8,201,664 |
519,159 |
(2,884,872) |
9,016,467 |
Issue of share
capital |
2,778 |
566,612 |
- |
- |
569,390 |
Share issue costs |
- |
- |
- |
(31,390) |
(31,390) |
Share based
payments |
- |
- |
5,965 |
- |
5,965 |
Loss for the financial
period |
- |
- |
- |
(215,342) |
(215,342) |
Balance at 30
November 2018 |
3,183,294 |
8,768,276 |
525,124 |
(3,131,604) |
9,345,090 |
Share capital
The share capital comprises the nominal value share capital
issued for cash and non-cash consideration. The share capital also
comprises deferred share capital. The deferred share capital* arose
through the restructuring of share capital which was approved at an
Annual General Meeting held on 9 December
2016.
Authorised share capital:
The authorised share capital at 30
November 2019 compromised 7,301,301,041 ordinary shares of
€0.00025 each, and 317,785,034 deferred shares of €0.00999 each*
(€5,000,000), (30 November 2018:
7,301,301,041 ordinary shares of €0.00025 each, and 317,785,034
deferred shares of €0.00999 each* (€5,000,000)).
*Capital reorganisation:
Following approval at an Annual General Meeting (“AGM”) held on
9 December 2016, the Company
reorganised its share capital by subdividing and reclassifying each
issued ordinary share of €0.01 as one ordinary share of €0.00001
each and one deferred share of €0.00999 each. The Deferred
Shares have no right to vote, attend or speak at general meetings
of the Company and have no right to receive any dividend or other
distribution, and have only limited rights to participate in any
return of capital on a winding-up or liquidation of the Company,
which will be of no material value. No application was made to the
London Stock Exchange for admission of the Deferred Shares to
trading on the AIM.
Consolidated shares:
On 21 December 2017, the Company
passed a Special Resolution at the Company’s AGM, that all of the
ordinary shares of €0.00001 each in the capital of the Company,
whether issued or unissued were consolidated into New Ordinary
Shares of €0.00025 each in the capital of the Company
(“consolidated shares”) on the basis of one consolidated share for
every 25 existing ordinary shares. Following the consolidation of
the ordinary shares on 21 December
2017, the warrants in issue were consolidated into one
consolidated warrant for every 25 existing warrants. The exercise
price in relation to the warrants was also adjusted at this time
(see Note 2).
Share issues during the period:
On 16 July 2019, the Company
raised €111,377, (before expenses) through the issue of 2,500,000
ordinary shares of €0.00025 in the capital of the Company at a
price of £0.04 per Subscription Share. On 8
October 2019, the Company raised €56,060, (before expenses)
through the issue of 1,428,571 ordinary shares of €0.00025 in the
capital of the Company at a price of £0.035 per Subscription Share.
On 4 September 2019, the Director,
Richard Conroy converted €71,425 of
his loan into 1,625,000 shares of €0.00025 in the capital of the
Company at a price of £0.04 per Subscription Share.
On 11 June 2018, the Company
raised €569,390, (before expenses), through the issue of 11,111,111
ordinary shares of €0.00025 in the capital of the Company at a
price of £0.045 per Subscription Share. 388,889 broker warrants
were also issued on 11 June 2018.
Share premium
The share premium reserve comprises the excess consideration
received in respect of share capital over the nominal value of the
shares issued.
Share based payment reserve
The share based payment reserve comprises of the fair value of
all share options and warrants which have been charged over the
vesting period, net of amounts relating to share options and
warrants forfeited, exercised or lapsed during the year, which are
reclassified to retained earnings.
Retained losses
This reserve represents the accumulated losses incurred by the
Company up to the condensed statement of financial position
date.
Notes to and
forming part of the condensed financial statements for the six
month period ended 30 November
2019
- Accounting policies
Reporting entity
Karelian Diamond Resources plc (the “Company”) is a company
domiciled in Ireland.
Basis of preparation and statement of
compliance
The condensed financial statements for the six months ended
30 November 2019 are unaudited.
The condensed financial statements have been prepared in
accordance with International Accounting Standard (“IAS”) 34:
Interim Financial Reporting.
The condensed financial statements do not include all the
information and disclosures required in the annual financial
statements, and should be read in conjunction with the Company’s
annual financial statements as at 31 May
2019, which are available on the Company’s website -
www.kareliandiamondresources.com. The accounting policies adopted
in the presentation of the condensed financial statements are
consistent with those followed in the preparation of the Company’s
annual financial statements for the year ended 31 May 2019
The condensed financial statements have been prepared under the
historical cost convention, except for derivative financial
instruments which are measured at fair value at each reporting
date.
The condensed financial statements are presented in Euro (“€”).
€ is the functional currency of the Company.
The preparation of condensed financial statements requires the
Board of Directors and management to use judgements, estimates and
assumptions that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. Actual results
may differ from those estimates. Estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the financial period in
which the estimate is revised and in any future financial periods
affected. Details of critical judgements are disclosed in the
accounting policies detailed in the annual financial
statements.
The financial information presented herein does not amount to
statutory financial statements that are required by Chapter 4 part
6 of the Companies Act 2014 to be annexed to the annual return of
the Company. The statutory financial statements for the financial
year ended 31 May 2019 were annexed
to the annual return and filed with the Registrar of Companies. The
audit report on those financial statements was unqualified.
These Condensed Financial Statements were authorised for issue
by the Board of Directors on 27 February
2020.
Going concern
The Company incurred a loss of €250,150 (30 November 2018: €215,342) for the six month
period ended 30 November 2019. The
Company had net current liabilities of €1,011,690 (30 November 2018: €464,552) at that date.
The Board of Directors have considered carefully the financial
position of the Company and in that context, have prepared and
reviewed cash flow forecasts for the period to 28 February 2021. As set out further in the
Chairman’s statement, the Company expects to incur capital
expenditure in 2020, consistent with its strategy as an exploration
company. In reviewing the proposed work programme for exploration
and evaluation assets and, on the basis of the equity raised during
the financial period, the results obtained from the exploration
programme and the prospects for raising additional funds as
required, the Board of Directors are satisfied that it is
appropriate to prepare the financial statements on a going concern
basis.
Statement of compliance
The Company’s financial statements have been prepared in
accordance with IFRS as adopted by the European Union (“EU”).
Recent accounting pronouncements
The following new standards, amendments to standards and
interpretations adopted and endorsed by the EU came into effect
1 January 2019. The adoption of these
amendments and interpretations does not have a significant impact
on the consolidated financial statements either due to being not
applicable or immaterial:
- Amendments to IFRS 9: Prepayment features with negative
compensation – Effective date 1 January
2019
- Amendments to IAS 28: Long-term interests in associates and
joint ventures – Effective date 1 January
2019
- Annual improvements to IFRS Standards 2015-2017 Cycle:
Amendments to IFRS 3, IFRS 11, IAS 12 and IAS 23 – Effective date
1 January 2019
- Amendments to IAS 19: Plan Amendment, Curtailment or Settlement
– Effective date 1 January 2019
- IFRS 16 – Leases – Effective date 1
January 2019
- IFRIC 23: Uncertainty over income tax treatments – Effective
date 1 January 2019.
The following new standard and amendments to standards have been
issued by the International Accounting Standards Board but have not
yet been endorsed by the EU, accordingly none of these standards
have been applied in the current period. The Board of Directors are
currently assessing whether these standards once endorsed by the EU
will have any impact or a material impact on the consolidated
financial statements.
- Amendments to references to the Conceptual Framework in IFRS
Standards – Effective date 1 January
2020
- IFRS 17: Insurance contracts – Effective date 1 January 2021
- Amendments to IFRS 3 Business Combinations – Definition of a
Business – Effective date 1 January
2020
- Amendments to IAS 1 and IAS 8 – Definition of Material –
Effective date 1 January 2020
- Amendments to IFRS 9, IAS 39 and IFRS 7 – Interest Rate
Benchmark Reform – Effective date 1 January
2020
- Amendments to IFRS 10 and IAS 28: Sale or contribution of
assets between an investor and its associate or joint venture –
postponed indefinitely.
- Loss per share
Basic earnings per share |
|
|
|
|
|
|
|
|
|
|
Six
month period ended 30 November 2019 (Unaudited) € |
|
Six month period ended 30 November 2018 (Unaudited)
€ |
|
Year ended 31 May 2019
(Audited) € |
Loss for the financial
period/year attributable to equity holders of the Company |
|
|
(250,150) |
|
(215,342) |
|
(370,654) |
|
|
|
|
|
|
|
|
Number of ordinary shares for the
purposes of earnings per share |
|
|
40,042,749 |
|
34,489,179 |
|
34,154,324 |
|
|
|
|
|
|
|
|
Loss per ordinary share |
|
|
(€0.0069) |
|
(€0.0064) |
|
(€0.0109) |
|
|
|
|
|
|
|
|
|
|
On 16 July 2019, the Company
raised €111,377, (before expenses) through the issue of 2,500,000
ordinary shares of €0.00025 in the capital of the Company at a
price of £0.04 per Subscription Share. On 8
October 2019, the Company raised €56,060, (before expenses)
through the issue of 1,428,571 ordinary shares of €0.00025 in the
capital of the Company at a price of £0.035 per Subscription Share.
On 4 September 2019, the Director,
Richard Conroy converted €71,425 of
his loan into 1,625,000 shares of €0.00025 in the capital of the
Company at a price of £0.04 per Subscription Share.
On 11 June 2018, the Company
raised €569,390, (before expenses), through the issue of 11,111,111
ordinary shares of €0.00025 in the capital of the Company at a
price of £0.045 per Subscription Share.
Diluted earnings per share
The effect of share options and warrants is anti-dilutive.
Following the consolidation of the ordinary shares on
21 December 2017, the warrants in
issue were consolidated into one consolidated warrant for every 25
existing warrants. The exercise price in relation to the warrants
was also adjusted at that time, to the following:
- Expiry date: 29 December 2018 -
20p sterling;
- Expiry date: 28 April 2019 - 20p
sterling;
- Expiry date: 16 November 2022 -
£2.20 sterling.
- Intangible assets
Exploration and evaluation
assets |
|
|
|
|
|
|
Cost |
30 November 2019
(Unaudited) € |
|
30
November 2018 (Unaudited) € |
|
31 May 2019
(Audited) € |
At 1 June |
10,152,733 |
|
9,661,559 |
|
9,661,559 |
Expenditure during the financial
period/year |
|
|
|
|
|
- License and appraisal costs
|
2,978 |
|
71,198 |
|
298,829 |
- Other operating expenses
|
127,150 |
|
234,889 |
|
192,345 |
- Equity settled share based payments
|
- |
|
- |
|
- |
At 30 November/31
May |
10,282,861 |
|
9,967,646 |
|
10,152,733 |
|
|
|
|
|
|
|
|
|
Exploration and evaluation assets relate to expenditure incurred
in the development of mineral exploration opportunities. These
assets are carried at historical cost and have been assessed for
impairment in particular with regard to the requirements of IFRS 6:
Exploration for and Evaluation of Mineral Resources relating
to remaining licence or claim terms, likelihood of renewal,
likelihood of further expenditure, possible discontinuation of
activities as a result of specific claims and available data which
may suggest that the recoverable value of an exploration and
evaluation asset is less than its carrying amount.
The Board of Directors have considered the proposed work
programmes for the underlying mineral resources. They are satisfied
that there are no indications of impairment.
The Board of Directors note that the realisation of the
intangible assets is dependent on further successful development
and ultimate production of the mineral resources and the
availability of sufficient finance to bring the resources to
economic maturity and profitability.
- Commitments and Contingencies
At 30 November 2019, there were no
capital commitments or contingent liabilities (31 May 2019: No capital commitments or
contingencies liabilities). Should the Company decide to develop
the Lahtojoki project, an amount of €80,000 is payable by the
Company.
- Related party transactions
(a) Shareholders’ loans |
30 November 2019
(Unaudited) € |
|
30 November 2018
(Unaudited) € |
|
31 May 2019
(Audited) € |
Opening balance 1 June |
158,087 |
|
192,489 |
|
192,489 |
Loan repayment |
- |
|
(34,481) |
|
- |
Loan advances |
7,000 |
|
- |
|
- |
Loan converted into shares |
(71,425) |
|
- |
|
(34,402) |
Closing balance 30
November/31 May |
93,662 |
|
158,008 |
|
158,087 |
Prior to the various placings of shares, the immediate funding
requirements of the Company had been financed by advances from
Professor Richard Conroy (executive
chairman and major shareholder).
- Apart from Directors’ remuneration, and loans from
shareholders, (who are also Directors), there here have been no
contracts or arrangements entered into during the six month period
in which a Director of the Company had a material interest.
- The Company shares accommodation with Conroy Gold and Natural Resources plc which have
certain common Directors and shareholders. For the six month period
ended 30 November 2018, Conroy Gold and Natural Resources plc incurred
costs totalling €54,034 (30 November
2018: €74,968) on behalf of the Company. These costs were
recharged to the Company by Conroy
Gold and Natural Resources plc. At 30
November 2019, Conroy Gold
and Natural Resources plc is owed €29,812 by the Company. At
30 November 2018 Conroy Gold and
Natural Resources plc owed €117,514 to the Company.
- Subsequent events
Post period a subscription and issue of a convertible loan note
raised a total of £240,000. This subscription and issue of
convertible loan note was subscribed by a new investor Mr. Fredrik
Björnberg.
- Approval of the Condensed Financial Statements
These Condensed Financial Statements were approved by the Board
of Directors on 27 February 2020. A
copy of the Condensed Financial Statements will be available on the
Company’s website www.kareliandiamondresources.com on 28 February 2020.
ENDS