TIDMKGLD
RNS Number : 4578T
Kolar Gold Limited
20 November 2013
20 November 2013
Kolar Gold Limited
Final results for the year ended 30 June 2013
Kolar Gold Limited (AIM: KGLD, referred to as 'KGL', 'Kolar
Gold' or the 'Company') is pleased to announce its audited results
for the year ended 30 June 2013.
The annual report and accounts are available on the Company's
website.
Enquiries:
Kolar Gold Limited
Nick Spencer / Chris Clowes +617 3846 0211
N+1 Singer (Nomad and Joint Broker)
James Maxwell / Jenny Wyllie +44 20 7496 3000
Ocean Equities Limited (Joint Broker)
Guy Wilkes / Will Slack +44 20 7786 4370
Tavistock Communications
Edward Portman / Nuala Gallagher +44 20 7920 3150
Churchgate Partners
Sumir Bhadwaj +44 7768 696760
Chairman's Report
Dear Shareholder
This is my third Chairman's Report to the shareholders of Kolar
Gold Limited. It has been a year of several challenges and changes
for the Company but as many of you may have seen there have been
some very positive developments post year end.
India's deep passion for gold continues and, combined with a low
domestic production, this results in India importing nearly 1,000
tonnes per year. India and China are by far the two largest gold
consuming countries and India, with some of the most prospective
gold terrain in the world, only has one active gold mine, producing
just two tonnes per year whilst last year it imported 20% of the
world's production. After the importation of energy, gold imports
are the second largest contributor to India's current account
deficit.
The Government of India is attempting to curb gold imports to
try to contain a record current-account deficit that has weakened
the rupee to an all-time low, and in August this year it increased
import taxes for the third time this year by up to 10%. The
Government's strategic rationale to develop gold mines in India
remains strong.
The domestic mining regime remains in a state of flux, as I
reported in my statement last year as the long anticipated approval
of the Mines and Minerals Development and Regulation (MMDR) Bill,
which has been approved by Cabinet, still awaits approval by the
Indian Parliament. The timing of the passing of this bill and the
exact terms are still unclear. This, together with the slow pace in
the privatisation of state-owned assets and granting of licences in
mining and other industries in India has resulted in a regulatory
environment that is not conducive to prompt and timely decision
making, even when all the relevant processes are followed
diligently.
It is hoped that the MMDR, once passed, will create a better
legislative environment for attracting investment and technology to
the mining sector. This would help India to develop its mining
sector to its full potential with companies in the sector operating
to international best practice standards. Recent clampdowns on
illegal mining will also assist the industry to progress and
develop in a responsible manner.
During our last financial year the Board undertook a review of
the rate of progress of activities in India and the environment for
our business. The slow pace of progress amongst the federal and
state authorities involved in gold mining led to the slower than
anticipated grant of new licences to our new affiliate Geomysore
Services India Private Limited ("GMSI"). The anticipated
exploration licences in respect of North and East Kolar have not
yet materialised and consents to progress with exploration
activities on existing licences from, for example, the Forestry
Commission were slow. Consequently, the Board reviewed the
company's strategy in order to ensure cash resources were utilised
to create the best value for shareholders over the near and medium
term in the gold exploration and mining development sector of
India. As part of the refined strategy, management and cash
resources were focused on assisting and working with GMSI to
procure the granting of prioritised, later stage key gold
exploration and mining licenses. A number of cost saving measures
were also implemented including the scale down of the Company's
Brisbane office with key management moving to the well-established
GMSI office in Bangalore.
As part of the refined strategy, the Company entered into a
heads of agreement with GMSI in August 2013, in exchange for the
dissolution of the Option Agreement and Mine Operators agreement
between the Company and GMSI (entered into at the time of listing
in June 2011 to acquire a 30% direct equity interest in GMSI for a
cash consideration of GBP700,000 plus the cancellation of a
GBP300,000 advance to GMSI during the reporting period. Kolar Gold
acquired a 30% direct equity interest in GMSI in August 2013. This
strategy allows us to work with GMSI and focus on a number of key
advanced gold projects as well as gaining exposure to a larger
number of licence applications with preferential rights. In October
2013, GMSI announced in India the grant of a mining licence in
respect of the Jonnagiri application, which is the first grant of
such a licence in India since 2003 and marks a significant value
creation step for the Company, which we would not have otherwise
had access to. This is a major step forward for both Kolar Gold and
GMSI. We are now working with GMSI to scope a pre-feasibility study
for the development of the Jonnagiri Mine which has 710k ounces of
JORC resources.
Equally important, is our focus on the proposed acquisition of
the Bharat Gold Mines Limited (BGML). Tendering for these assets
was and has remained a key objective of the Company since it joined
the AIM Market in June 2011. The historic Kolar Gold Fields have
produced 25 million ounces of gold at 15.9 grams per tonne over the
120 years of their operation until their closure in 2001 and
represent significant development potential. Our relationship with
the BGML ex-employees and their representative unions remains
strong and together we are pushing for the mine sale and revival
via the Right of First Refusal the workers have with our
collaboration. The historic BGML mine revival project reached a
very important milestone also by achieving a verdict in the Supreme
Court in July where the Government of India was instructed to
proceed with the sale tender process. We are currently awaiting the
start of this process.
We also continue to review a number of additional quality gold
exploration projects in India with a view to expanding our
portfolio of licences and licence applications, as we believe that
is an enhanced way of developing shareholder value within a
reasonable timeframe.
Our balance sheet remains strong, with GBP5.4m in cash at year
end, providing us with sufficient funds to conduct preparatory work
ahead of the start of the BGML tender process and secure other
identified priority gold projects, which is under constant review
and action.
It is widely recognised that we are in some very prospective
gold provinces and have now established our presence in India. Our
foundations are set, and the Company has a significant portfolio of
licences and licence applications and our priority focus remains
the execution of permit awards in key areas with our collective
resources and local partners and the subsequent development of
quality gold assets. We are committed to building the leading gold
explorer and mine developer in India.
Finally, there have been two changes to the Board, Mr Richard
Johnson, our former COO in India, stepped down as a director during
the financial year and Mr Shiv Khemka departed subsequent to the
year end. Mr Khemka was a non-executive director and SUN Mining's
representative on the Board. He was replaced by Mr Sivakumar the
Managing Director of SUN's Delhi office. I would like to record the
Board's gratitude to Shiv and Richard for their efforts and
commitment, over the past years. The Company remains well served by
a strong corporate team which will expand as Kolar Gold grows.
I would like to thank all employees, my fellow directors and our
partners who have participated in our progress this year.
Harvinder Hungin
Chairman
Kolar Gold Limited
19 November 2013
Chief Executive Officer's Report
In the last 12 months, we have made solid progress following a
comprehensive review of our business and exploration
strategies.
Our first priority has been to develop a closer cooperation with
our established partner, GMSI, a Bangalore based exploration group,
and work together to focus on pursuing selected advanced gold
exploration and mining licences that have been prioritised. The
primary route for this process was through a Heads of Agreement
("HoA") with GMSI that was signed in August 2013 resulting in the
Company acquiring a 30% equity stake in GMSI.
Secondly, management focussed on the delivery of these key
licence applications, especially given the slower than expected
grant of new licences. GMSI and their local partners have applied
considerable resources and effort to expedite permitting on the
priority licences. Permitting in India is a complex and lengthy
process that needs continual application of management resources to
move files through a large number of bureaucratic steps. GMSI is
one of the only private groups that has succeeded, having
previously secured 22 Reconnaissance Permits, and now having 2
Prospecting Licences (PL) and a Mining Lease in the gold sector. We
continue to work with GMSI and their partners who have successfully
achieved the granting of permits in the past.
Heads of Agreement (HoA) with GMSI
Under the terms of the HoA, the Kolar Gold Group (KG) acquired a
30% equity interest in GMSI, who together with KG, will explore and
develop its portfolio of 49 gold projects, thus enabling us to
accelerate our operations in India. It will also increase our
access to gold projects that are nearer production and spread
licence risk across a larger portfolio. GMSI's portfolio includes
project and first application rights to 11 Reconnaissance Permits,
32 Prospecting Licences, including 2 granted, and 6 Mining Leases
covering over 11,000 km(2) across India with 1.36Moz JORC resources
defined.
Under the HoA, Kolar Gold Resources Limited (KGM), KG's
Mauritius based subsidiary, is entitled to nominate one director to
the board of GMSI and any GMSI resolution or corporate action with
respect to certain corporate and operational matters will require
KGM's consent.
It is pleasing to report that this new approach has already
achieved success as GMSI has now successfully been granted the
Mining Lease at Jonnagiri, located in Andhra Pradesh, Southern
India, post financial year end in October 2013. The Jonnagiri
mining lease has an open pittable deposit of 2.9 Mt at an average
grade of 2.1 g/t Au containing a JORC indicated resource of 190,000
ozs Au and an underground deposit of 3.7 Mt at an average grade of
4.3 g/t Au containing a JORC inferred resource of 520,000 ozs Au.
There are significant gold intersections in the main Dona Temple
block of 41 m grading 5.83 g/t Au at a depth of 400m and 22.7 m at
7.52 g/t Au at a depth of 320 m. Our Competent Person, Mr James
Lally of Mining Associates has suggested there is a high potential
to increase the size of deposits through definition of extensions
to existing lodes and discovery of new lodes and has identified a
2-5Moz exploration target.
Exploration Programme
During the year Kolar Gold has been working closely with GMSI
geologists on exploration work at South Kolar. We continued with
geological mapping, trenching and geochemical soil sampling
programme to better identify the prospective anomalies in the
non-forestry areas of the South Kolar Lease area. A drill plan had
also been prepared for an additional 160 drill holes in the
Chigargunta and Mallappakonda areas, to be implemented upon
obtaining forestry permission and subject to prioritizing the use
of our cash resources. The application for this permit has been
submitted to the authorities and is being expedited with our
partners.
The previous drilling in the South Kolar prospect at NE
Chigargunta, the Chigargunta Eastern lodes and the Mallappakonda
deposit had successfully validated historical drilling results and
also provided valuable fresh geological data on the host rocks and
structural controls to mineralisation. To date 8,000m of both
Reverse Circulation (RC) and diamond drilling has been completed on
our target deposits and prospects. A JORC resource of 208,182 oz
has been defined with intercepts of 4.7m @ 24.7 g/t from 80m and
21.5m @ 5.5g/t from 98m. Drilling has principally targeted known
zones of mineralisation and extensions of auriferous lodes
previously mined at the Chigargunta mine in the south and the
Bisanatham mine in the north of the licence area.
Bharat Gold Mines Limited (BGML) Acquisition
Kolar Gold, jointly with its partner, the combined BGML
Ex-employee Unions Society, and with the assistance of SUN Mining,
has continued to make progress with the Government of India in the
pursuit of the acquisition and development of the BGML gold mine
assets. The matter was passed to the Supreme Court for final
direction on the tender sale process. We are encouraged with the
recent court order from the Supreme Court to proceed with the sale
and revival of the BGML mine by tender process, giving the Right of
First/Last Refusal to the Society and KG as their technical and
financial collaborator.
The Government of India has also recently completed a tender to
select the advisor that will be responsible for firstly updating
the sale tender documents which were drafted by Ernst & Young
as previous advisors to the government. The new advisor will also
be responsible for managing the tender process and undertaking a
revaluation of the BGML tender assets. Kolar Gold, in conjunction
with local partners and the BGML ex-employee unions, are now
reviewing its previous work and valuation in order to be able to
submit a counter offer at the appropriate time that will meet the
requirements of the tender document.
We believe that our exploration and development of the
surrounding Kolar Gold Projects, in conjunction with GMSI, who have
rights to all adjoining leases in the Kolar Gold Belt, will
demonstrate our commitment to gold exploration in this region and
should assist this process. Any acquisition of the BGML assets
would require additional funding from the market.
Conclusion
The next 12 months are expected to be a very busy time for Kolar
Gold as we look to build a stronger presence in India and proceed
with focused effort on permitting and selective exploration of
these potentially world class gold assets. In particular, the
development of the Jonnagiri Mining Lease is potentially an
excellent operational gold project for the Company to commence gold
production in India.
I look forward to continuing our work together to grow the
business and our Indian assets. I would also like to thank our
shareholders for their continued support of the Company, especially
over the last year.
Nick Spencer
Chief Executive Officer
Kolar Gold Limited
19 November 2013
Board of Directors
Harvinder Hungin (aged 53) (Non-Executive Chairman)
Mr. Hungin was an investment banker for 18 years until 2002 at
Lazard, Hambros and Société Générale ("SG"). As part of his
responsibilities, he oversaw the Indian activities of Hambros,
subsequently SG, from 1995 onwards. Since 2003 he has been involved
in large scale real estate and infrastructure development in the
UK, Europe and latterly India, and has built a portfolio of
diversified growth businesses in a number of sectors, operating
internationally.
Nicholas Spencer (aged 51) (Chief Executive Officer)
Mr. Spencer joined the board of Kolar Gold plc in 2004 and has
experience in building businesses in mining, logistics, aerospace
and engineering services with multinational companies in Australia,
the United Kingdom, Asia and the Middle East. He has 25 years
experience in international business including mine build and
revival, open pit mining, equipment purchase and mine finance. He
was responsible for building a $125 million mine in Egypt and spent
more than seven years with BHP managing operations and business
development in Australia. Mr. Spencer also spent many years in Asia
establishing joint ventures for TNT Limited. He is an engineer with
an MBA from Cranfield UK who has held senior executive positions
with BHP, TNT, Meggitts Aerospace, Babcock Contractors and
co-founded private equity fund manager, Crescent Capital
Partners.
Stephen C Coe (FCA, BSc) (aged 47) (Non-Executive Director)
Mr. Coe is self employed and a Chartered Accountant. He acts as
a director of a number of listed and unlisted investment funds and
offshore companies including Raven Russia Limited, European Real
Estate Investment Trust Limited, South African Property
Opportunities Limited Trinity Capital PLC, and Weiss Korea
Opportunities Fund Limited (and serves as Chairman of the Audit
Committee for these companies). He has been involved with offshore
companies since 1990 with significant exposure to property, debt,
emerging markets and private equity investments.
Shiv Khemka (aged 49) (Non-Executive Director)
(Resigned 16 August 2013)
Stephen Oke (aged 59) (Non-Executive Director)
Mr. Oke holds a BSc Honours degree in Geology from the
University of Southampton and an MBA from the University of the
Witwatersrand Graduate School of Business. He has over 35 years'
experience in the mining and metals industry in both operational
management and investment banking. He is a non-executive director
of International Ferro Metals Limited and Chairman of Shaft Sinkers
Holdings plc and was previously on the boards of African Mining and
Exploration Limited, Nikanor plc, Katanga Mining Limited and
Kazakhgold Group Limited.
Vaidyanathan Venkateswaran Sivakumar (aged 50) (Non-Executive
Director)
(Appointed 16 August 2013)
Mr Sivakumar is Managing Director and Head of SUN's New Delhi
office. He previously worked in SUN's Moscow office for five years
as Head of Research & Investments for SUN Capital Partners.
Prior to SUN, Mr Sivakumar spent several years in equity and credit
research in public markets with Crosby Securities, Peregrine
Capital and CRISIL (now S&P India). He also has six years
industrial experience with ICI India and holds engineering and
management degrees from the Indian Institute of Technology and
Indian Institute of Management respectively. He is a member of
CII's National Committee on Mining.
Directors' Report
The directors present the consolidated financial report of Kolar
Gold Limited (the Company and its subsidiaries (the Group for the
year ended 30 June 2013 and the auditor's report thereon.
Performance review
The Group made a comprehensive loss of GBP2,199,438 during the
year ended 30 June 2013 (2012: loss of GBP2,382,386) due mainly to
its Indian operations, its activities in Guernsey and Australia and
advisory and due diligence costs of GBP741,671 (2012:
GBP235,363).
Principal activities and future developments
The Group's principal activity is the exploration and
development of tenement rights in India, in conjunction with its
Indian affiliate, Geomysore Services India Private Limited ("GMSI)
and securing and reviving the historic gold mines of the Kolar
Goldfields of Bharat Gold Mines Limited in that region.
Subsequent event
On 16 August 2013 the Group announced that it had entered into a
binding Heads of Agreement ("HoA") with GMSI to invest funds into
GMSI and develop a number of advanced stage quality gold projects
in India, including the Jonnagiri Gold Project which already has a
JORC compliant Resource. The Group acquired a 30% equity interest
in GMSI in exchange for:
-- a cash consideration of GBP700,000,
-- the cancellation of a GBP300,000 advance by the Group to GMSI
during the reporting period, and
-- the dissolution of the 2011 agreements with GMSI in which the
Group secure rights over the 14 Kolar
Gold Projects.
All rights in the Kolar Gold Projects have now been returned to
GMSI.
Principal risks and uncertainties
The Group is exposed to a variety of financial risks including
foreign exchange risk, interest rate risk, liquidity risk and
credit risk. These risks are discussed in detail in Note 2.
Note 12 to the financial statements - Financial instruments and
associated risks
The Board of Directors is committed to effective risk management
and is responsible for ensuring that the Group has an appropriate
framework in place to identify and effectively manage business
risks and to monitor business performance and the Group's financial
position. The Board is also responsible for overseeing compliance
with regulatory, prudential, legal and ethical standards.
Accounting policies
The accounting policies of the Group as set out below have been
applied consistently during the year.
Dividends
No dividends have been paid or declared and the Directors do not
recommend the declaration of a dividend for the year ended 30 June
2013 (2012: nil).
The UK Takeover Code
On 30 September 2013, certain changes to the UK Takeover Code
came into effect which meant that the Company became subject to the
UK Takeover Code on that date. This is due to the Company's
incorporation in Guernsey, being one of the relevant jurisdictions
now subject to the UK Takeover Code.
Directors' remuneration and interests
2013
Remuneration Interests
Director Cash-settled Share-based Totals Shares Options
transactions payments
GBP GBP GBP No. No.
Harvinder Hungin (Chairman) 45,000 8,119 53,119 1,700,000(1) 600,000
Nicholas Spencer (Chief
Executive Officer) Refer
Note 16 258,752 12,588 271,340 1,763,569 1,850,000
Richard Johnson (Resigned
7.12.12) Refer Note 16 235,124 - 235,124
Stephen Coe (2) 27,708 14,057 41,765 237,439 475,000
Stephen Oke 40,000 6,765 46,765 Nil 475,000
Shiv Khemka 30,000 - 30,000 Nil Nil
------------ -------- ------------- ----------
TOTALS 636,584 41,529 678,113 3,701,008 3,400,000
============== ============ ======== ============= ==========
2012
Remuneration Interests
Director Cash-settled Share-based Totals Shares Options
transactions payments
GBP GBP GBP No. No.
Harvinder Hungin (Chairman) 45,000 - 45,000 1,700,000(1) 450,000
Nicholas Spencer (Chief
Executive Officer)Refer
Note 16 465,214 - 465,214 1,763,569 1,850,000
Richard Johnson (Chief
Operating Officer) Refer
Note 16 239,800 - 239,800 725,000 675,000
Stephen Coe (2) 17,500 17,500 35,000 44,777 350,000
Stephen Oke 40,000 - 40,000 Nil 350,000
Shiv Khemka 30,000 - 30,000 Nil Nil
------------ -------- ------------- ----------
TOTALS 837,514 17,500 855,014 4,233,346 3,675,000
============== ============ ======== ============= ==========
(1) SG Hambros Trust Company (Channel Islands) Limited hold
1,700,000 Ordinary Shares and 200,000 options, as trustee of the
Carlyle Settlement, in which Harvinder Hungin and his family have
an interest.
(2) Portion paid by the issue of shares.
The above remuneration relates to Kolar Gold Limited directors
only. The Key Management Personnel remuneration disclosed in Note
16 to the financial statements has been calculated on a
consolidated basis and includes payments to directors who were
Directors of Kolar Gold plc only and other Key Management
Personnel.
Results for the year and state of affairs at 30 June 2013
The Consolidated Statement of Comprehensive Income and the
Consolidated Statement of Financial Position are set out below of
the financial statements.
Accounting records
The Directors believe that they have complied with the
requirements of Section 244 of the Companies (Guernsey) Law 2008,
as amended with regards to the financial statements by employing
appropriate expertise and providing adequate resources to the
financial function within the Group.
Statement of Directors' responsibilities
The Directors are responsible for preparing the Directors'
Report and the Financial Statements in accordance with applicable
law and regulations.
Companies (Guernsey) Law 2008, as amended and AIM rules require
the Directors to prepare financial statements for each financial
year. Under that law they have elected to prepare the financial
statements in accordance with International Financial Reporting
Standards and applicable law.
The financial statements are required by law to give a true and
fair view of the state of affairs of the company and of the profit
or loss of the Company for the year.
In preparing these financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them
consistently;
-- make judgements and estimates that are reasonable and
prudent;
-- state whether applicable accounting standards have been
followed, subject to any material departures disclosed and
explained in the financial statements; and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the company will
continue in business.
The Directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time the
financial position of the Company and to enable them to ensure that
the financial statements comply with the Companies (Guernsey) Law
2008, as amended and AIM rules. They have general responsibility
for taking such steps as are reasonably open to them to safeguard
the assets of the Company and to prevent and detect fraud and other
irregularities.
Directors' confirmation
The Directors confirm that they have complied with the
requirements in preparation of the financial statements as at the
date of approval of this report. So far as the Directors are aware,
there is no relevant audit information of which the Company's
auditor is unaware, having taken all the steps the Directors ought
to have taken to make themselves aware of any relevant audit
information and to establish that the Company's auditor is aware of
that information.
Going concern
After making enquiries, and considering the current level of
activity, financial arrangements made and for the reasons disclosed
in note 1.3 of the financial statements, the Directors consider
that the Company will have adequate resources to continue in
operational existence for the foreseeable future. For this reason,
they continue to adopt the going concern basis in preparing the
financial statements.
Corporate governance statement
The Company, being listed on AIM, is not required to comply with
the UK Corporate Governance Code ("the Code"). However, the Company
has given consideration to the main principles of the Code and the
Directors support the objectives of the Code and intend to comply
with those aspects that they consider relevant to the Group's size
and circumstances. Details of these are set out below.
The Board of Directors
The Board currently comprises one Executive and four
Non-Executive Directors, two of which are independent. The Board
formally meets approximately every three months and is responsible
for setting and monitoring Group strategy, reviewing budgets and
financial performance, ensuring adequate funding, examining major
acquisition opportunities, formulating policy on key issues and
reporting to the Shareholders.
Internal Financial Control
The Board is responsible for establishing and maintaining the
Group's system of internal financial controls. Internal financial
control systems are designed to meet the particular needs of the
Group and the risk to which it is exposed, and by its very nature
can provide reasonable, but not absolute, assurance against
material misstatement or loss. The Directors are conscious of the
need to keep effective internal financial control. The Directors
have reviewed the effectiveness of the procedures presently in
place and consider that they are appropriate to the nature and
scale of the operations of the Group.
The Audit Committee
An Audit Committee has been established which comprises three
Non-Executive Directors - Stephen Coe (who chairs the Committee),
Stephen Oke and Harvinderpal Hungin all of whom are considered to
have recent and relevant financial experience. The Committee is
responsible for ensuring that the financial performance of the
Group is properly reported on and monitored, and for meeting the
Auditor and reviewing the reports from the Auditor relating to
accounts and internal controls. The Committee also reviews the
Group's annual and interim financial statements before submission
to the Board for approval. The role of the Audit Committee is also
to consider the appointment of the Auditor, audit fees, scope of
audit work and any resultant findings.
The Remuneration Committee
The Remuneration Committee comprises three Non-Executive
Directors - Stephen Oke (who chairs the Committee), Stephen Coe and
Harvinderpal Hungin. It is responsible for reviewing the
performance of the Executive Directors and for setting the scale
and structure of their remuneration, paying due regard to the
interests of Shareholders as a whole and the performance of the
Group. The remuneration of the Chairman and the Non-Executive
Directors is determined by the Board as a whole, based on a review
of the current practices in other similar companies.
On behalf of the Board
_____________________________________
Director
19 November 2013
Kolar Gold Limited and its controlled entities
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2013
Group
Note 2013 2012
GBP GBP
Other income 267 -
SUN Mining warrants expensed for
services 9 (77,542) (571,391)
Options to Directors 9 (21,649) -
Salaries and wages (551,049) (514,527)
Advisory and due diligence - GMSI
and other prospective gold assets (741,671) (235,363)
Other administrative expenses (887,201) (1,155,119)
Loss from operating activities (2,278,845) (2,476,400)
------------- ------------
Finance income 99,188 147,889
Finance costs (14,271) (1,087)
Net financing income/(expense) 84,917 146,802
------------- ------------
Loss before tax (2,193,928) (2,329,598)
Income tax expense 5 - -
------------- ------------
Loss for the year (2,193,928) (2,329,598)
Other comprehensive loss
Foreign exchange translation variances (5,510) (52,788)
------------- ------------
Total comprehensive loss for the
year (2,199,438) (2,382,386)
============= ============
Basic and diluted loss per share
(p) 11 2.14 2.33
All results are derived from continuing activities.
The notes are an integral part of the consolidated financial
statements.
Kolar Gold Limited and its controlled entities
Consolidated Statement of Financial Position
as at 30 June 2013
Group
2013 2012
Note GBP GBP
Non-current assets
Plant and equipment 19,674 25,238
Exploration and evaluation assets 6 6,122,168 5,496,153
Total non-current assets 6,141,842 5,521,391
------------ ------------
Current assets
Trade and other receivables 29,544 54,824
Prepayments and other assets 27,506 50,687
Term deposits 4,671,734 -
Cash and cash equivalents 698,817 8,131,892
Total current assets 5,427,601 8,237,403
------------ ------------
Total assets 11,569,443 13,758,794
------------ ------------
Current liabilities
Trade and other payables 7 321,450 423,513
Employee benefits 8 134,760 178,956
Total current liabilities 456,210 602,469
------------ ------------
Non-current liabilities
Employee benefits 8 4,606 2,992
------------ ------------
Total non-current liabilities 4,606 2,992
------------ ------------
Total liabilities 460,816 605,461
------------ ------------
Total net assets 11,108,627 13,153,333
============ ============
Equity
Share capital 7,440,546 7,010,625
Share premium 15,690,724 15,700,535
Reserves 3,824,910 4,095,798
Accumulated losses (15,847,553) (13,653,625)
------------ ------------
Total equity 11,108,627 13,153,333
============ ============
These financial statements were approved by the Board of
Directors on 15 November 2013 and were signed on its behalf by:
_______________________
Stephen Coe
Director
The notes are an integral part of the consolidated financial
statements.
Kolar Gold Limited and its controlled entities
Consolidated Statement of Changes in Equity
for year ended 30 June 2013
Share Share premium Share Foreign Accumulated Total equity
capital based exchange losses
payment translation
reserve reserve
GBP GBP GBP GBP GBP GBP
Balance at 30 June
2011 7,001,696 15,663,226 3,510,291 66,904 (11,324,027) 14,918,090
---------- -------------- ---------- ------------- ------------- -------------
Loss for the year - - - - (2,329,598) (2,329,598)
Other comprehensive
loss - foreign exchange
translation variances - - - (52,788) - (52,788)
---------- -------------- ---------- ------------- ------------- -------------
Total comprehensive
loss for the year - - - (52,788) (2,329,598) (2,382,386)
---------- -------------- ---------- ------------- ------------- -------------
Issue of ordinary
shares 8,929 37,309 - - - 46,238
Equity-settled transactions - - 571,391 - - 571,391
---------- -------------- ---------- ------------- ------------- -------------
Total contributions
by and distributions
to owners 8,929 37,309 571,391 - - 617,629
---------- -------------- ---------- ------------- ------------- -------------
Balance at 30 June
2012 7,010,625 15,700,535 4,081,682 14,116 (13,653,625) 13,153,333
========== ============== ========== ============= ============= =============
Loss for the year - - - - (2,193,928) (2,193,928)
Other comprehensive
loss - foreign exchange
translation variances - - - (5,510) - (5,510)
---------- -------------- ---------- ------------- ------------- -------------
Total comprehensive
loss for the year - - - (5,510) (2,193,928) (2,199,438)
---------- -------------- ---------- ------------- ------------- -------------
Exercise of SUN warrants 408,318 (43,749) (364,569) - - -
Other issues of ordinary
shares 21,603 33,938 - - - 55,541
Equity-settled transactions - - 99,191 - - 99,191
---------- -------------- ---------- ------------- ------------- -------------
Total contributions
by and distributions
to owners 429,921 (9,811) (265,378) - - 154,732
---------- -------------- ---------- ------------- ------------- -------------
Balance at 30 June
2013 7,440,546 15,690,724 3,816,304 8,606 (15,847,553) 11,108,627
========== ============== ========== ============= ============= =============
The notes are an integral part of the consolidated financial
statements.
Kolar Gold Limited and its controlled entities
Consolidated Statement of Cash Flows
For the year ended 30 June 2013
Note 2013 2012
GBP GBP
Cash flows from operating activities
Loss for the year (2,193,928) (2,329,598)
Adjustments for:
Depreciation 6,410 6,720
Net financing (income)/expense (84,917) (144,045)
Foreign exchange variances 14,716 (16,930)
Equity-settled transactions 9 99,191 571,391
Operating loss before changes in
working capital and provisions (2,158,528) (1,912,462)
Change in trade and other receivables 21,021 25,049
Change in other current assets 23,181 (12,936)
Change in trade and other payables (51,755) (712,646)
Change in employee benefits (42,582) 25,075
------------ ------------
Cash used in operating activities (2,208,663) (2,587,920)
Interest and finance costs paid (14,271) (1,087)
Net cash used in operating activities (2,222,934) (2,589,007)
------------ ------------
Cash flows from investing activities
Interest received 103,447 124,900
Funds placed on term deposit (4,671,734) -
Payments for exploration and evaluation
assets (676,323) (948,912)
Payments for plant and equipment (846) (11,292)
Net cash used in investing activities (5,245,456) (835,304)
------------ ------------
Cash flows from financing activities
Proceeds from other share issues 55,541 46,238
Net cash from financing activities 55,541 46,238
------------ ------------
Net increase/(decrease) in cash
and cash equivalents (7,412,849) (3,378,073)
Foreign exchange gain/(loss) on
opening cash balances (20,226) (34,665)
Cash and cash equivalents at 1
July 8,131,892 11,544,630
------------ ------------
Cash and cash equivalents at 30
June
(Excludes term deposits of GBP4,671,734) 698,817 8,131,892
============ ============
The notes are an integral part of the consolidated financial
statements
Notes to the financial statements
1. Accounting policies
1.1 Reporting entity
The group financial statements consolidate those of Kolar Gold
Limited and its controlled entities (together referred to as the
"Group").
As at 30 June 2013, the wholly owned subsidiaries of the Company
are:
-- Kolar Gold Resources Limited (Mauritius);
-- Kolar Gold Resources (India) Private Limited; and
-- Kolar Gold Pty Limited
The group financial statements have been prepared and approved
by the directors in accordance with International Financial
Reporting Standards as adopted by the EU ("Adopted IFRSs"). The
financial statements comply with the Companies (Guernsey) Law, 2008
as amended and give a true and fair view of the state of affairs of
the Group.
The accounting policies set out below have, unless otherwise
stated, been applied consistently to all periods presented in these
consolidated financial statements.
1.2 Measurement convention
The financial statements are prepared on the historical cost
basis, except for the following material item in the statement of
financial position and statement of comprehensive income:
-- Share-based payments are measured at fair value.
The financial statements are presented in Great British Pounds
(GBP).
1.3 Going concern
These financial statements have been prepared on the basis of
accounting principles applicable to a "going concern" which assumes
the Group will continue in operation for the foreseeable future and
will be able to realise its assets and discharge its liabilities in
the normal course of operations.
The Group currently has no source of operating cash inflows,
other than interest income, and has incurred net operating cash
outflows for the year ended 30 June 2013 of GBP2,222,934 (2012:
GBP2,589,007). At 30 June 2013, the Group had cash balances and
term deposits of GBP5,370,551 (2012: GBP8,131,892) and a surplus in
net working capital (current assets, including cash, less current
liabilities) of GBP4,971,391 (2012: GBP7,634,934).
On 16 August 2013 the Groupannounced that it had entered into a
binding Heads of Agreement ("HoA") with GMSI to invest funds into
GMSI and develop a number of advanced stage quality gold projects
in India, including the Jonnagiri Gold Project, which has a JORC
compliant Resource and has just been approved as a Mining Lease by
the Andhra Pradesh Government.
The Group acquired a 30% equity interest in GMSI in exchange
for:
-- a cash consideration of GBP700,000,
-- the cancellation of a GBP300,000 advance by the Group to GMSI
during the reporting period, and
-- the dissolution of the 2011 agreements with GMSI in which the
Group secure rights over the 14 Kolar
Gold Projects.
The Directors have prepared cash flow forecasts for KG for the
base case that KG maintains its interest in GMSI at 30%. These
forecasts indicate that KG will have sufficient cash to continue
meeting its operating expenditure (e.g. staff costs and
administrative costs), jncluding funding its BGML tender bid, until
at least early 2016. The Group, having dissolved the 2011
agreements with GMSI, is no longer committed to conducting
exploration activity in the Kolar Gold Belt and it will instead
further its interest through its close and on-going relationship
with GMSI and other quality Indian gold projects as identified. The
Group will now have improved access to gold projects nearer
production and the significantly larger portfolio of projects
spreads the risk and impact of delays in licence approvals.
However, the Group is not committed to provide any further funding
to GMSI as at the date of this report.
In the longer term, the Group's ability to develop and enhance
its interests in India, via BGML, if its tender bid is successful,
via the right of first refusal and its stake in GMSI, including
bringing the Jonnagiri mining assets to commercial production will
depend upon the ability of the Group and its partners to obtain
further financing through equity financing, debt financing or other
means.
The only sources of future funds presently available to the
Group are the raising of equity capital by the Company or the sale
of its interest in GMSI either in whole or in part. The ability of
the Group to arrange such funding in the future will depend in part
upon the prevailing market conditions as well as the business
performance of the Group. There can be no guarantee that the Group
will be successful in its efforts to arrange additional financing,
if needed, on terms satisfactory to the Group. If adequate
financing is not available, the Group may be required to reduce its
investments and related activities.
1.4 Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. Control
exists when the Group has the power to govern the financial and
operating policies of an entity so as to obtain benefits from its
activities. In assessing control, the Group takes into
consideration potential voting rights that are currently
exercisable. The acquisition date is the date on which control is
transferred to the acquirer. The financial statements of
subsidiaries are included in the consolidated financial statements
from the date that control commences until the date that control
ceases.
All entities were 100% owned and controlled by the parent
entity, Kolar Gold Limited during the period they were members of
the Group.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income
and expenses arising from intra-group transactions, are eliminated
in preparing the consolidated financial statements.
1.5 Foreign currency
Foreign currency transactions
Transactions in foreign currencies are translated to the
respective functional currencies of the Group's entities at the
foreign exchange rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies
at the balance sheet date are retranslated to the functional
currency at the foreign exchange rate ruling at that date. Foreign
exchange differences arising on translation are recognised in the
income statement. Non-monetary assets and liabilities that are
measured in terms of historical cost in a foreign currency are
translated using the exchange rate at the date of the
transaction.
Foreign operations
The assets and liabilities of foreign operations are translated
to the Group's presentation currency, at foreign exchange rates
ruling at the balance sheet date. The revenues and expenses of
foreign operations are translated at an average rate for the year
where this rate approximates to the foreign exchange rates ruling
at the dates of the transactions. Exchange differences arising from
the translation of foreign operations are reported as an item of
other comprehensive income and accumulated in the translation
reserve. When a foreign operation is disposed of, such that control
is lost, the entire accumulated amount in the translation reserve,
is recycled to profit or loss as part of the gain or loss on
disposal. When the Group disposes of only part of its interest in a
subsidiary that includes a foreign operation while still retaining
control, the relevant proportion of the accumulated amount is
reattributed to non-controlling interests.
Exchange differences arising from a monetary item receivable
from or payable to a foreign operation, the settlement of which is
neither planned nor likely in the foreseeable future, are
considered to form part of a net investment in a foreign operation
and are recognised directly in equity in the translation
reserve.
1.6 Classification of financial instruments issued by the Group
Following the adoption of IAS 32, financial instruments issued
by the Group are treated as equity only to the extent that they
meet the following two conditions:
(a) they include no contractual obligations upon the Group to
deliver cash or other financial assets or to exchange financial
assets or financial liabilities with another party under conditions
that are potentially unfavourable to the Group; and
(b) where the instrument will or may be settled in the Company's
own equity instruments, it is either a non-derivative that includes
no obligation to deliver a variable number of the Company's own
equity instruments or is a derivative that will be settled by the
Company's exchanging a fixed amount of cash or other financial
assets for a fixed number of its own equity instruments.
To the extent that this definition is not met, the proceeds of
issue are classified as a financial liability. Where the instrument
so classified takes the legal form of the Company's own shares, the
amounts presented in these financial statements for called up share
capital and share premium account exclude amounts in relation to
those shares.
Where a financial instrument that contains both equity and
financial liability components exists these components are
separated and accounted for individually under the above
policy.
1.7 Non-derivative financial instruments
Non-derivative financial instruments comprise trade and other
receivables, cash and cash equivalents, loans and borrowings, and
trade and other payables.
Trade and other receivables
Trade and other receivables are recognised initially at fair
value. Subsequent to initial recognition they are measured at
amortised cost using the effective interest method, less any
impairment losses.
Trade and other payables
Trade and other payables are recognised initially at fair value.
Subsequent to initial recognition they are measured at amortised
cost using the effective interest method.
Term deposits
Term deposits comprise bank deposits with maturity dates of
between 3 and 12 months from balance date.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call
deposits. Bank overdrafts that are repayable on demand and form an
integral part of the Group's cash management are included as a
component of cash and cash equivalents for the purpose of the
statement of cash flows.
1.8 Plant and equipment
Plant and equipment are stated at cost less accumulated
depreciation and accumulated impairment losses.
Where parts of an item of plant and equipment have different
useful lives, they are accounted for as separate items of plant and
equipment.
Depreciation is charged to the income statement on a
straight-line basis over the estimated useful lives of each part of
an item of plant and equipment. Land is not depreciated. The
estimated useful lives are as follows:
-- plant and equipment 2.5 to 5 years; and
-- fixtures and fittings 2.5 to 10 years
Depreciation methods, useful lives and residual values are
reviewed at each balance sheet date.
1.9 Exploration and evaluation expenditure
Exploration and evaluation costs, including the costs of
acquiring licences, are capitalised as exploration and evaluation
assets on an area of interest basis. Costs incurred before the
Group has obtained the legal rights to explore an area are
recognised in the profit or loss.
Exploration and evaluation assets are only recognised if the
rights of the area of interest are current and either:
-- the expenditures are expected to be recouped through
successful development and exploitation of the area of interest;
or
-- activities in the area of interest have not at the reporting
date, reached a stage which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves and
active and significant operations in, or in relation to, the area
of interest are continuing.
Exploration and evaluation assets are assessed for impairment
when facts and circumstances suggest that the carrying amount
exceeds the recoverable amount. For the purposes of impairment
testing, exploration and evaluation assets are allocated to
cash-generating units to which the exploration activity related.
The cash-generating unit shall not be larger than the area of
interest or the operating segment as disclosed in Note 3.
Once the technical feasibility and commercial viability of the
extraction of mineral resources in an area of interest are
demonstrable, exploration and evaluation assets attributable to
that area of interest are first tested for impairment and then
reclassified from intangible assets to mining property and
development assets within property, plant and development.
1.10 Impairment
A financial asset not carried at fair value through profit or
loss is assessed at each reporting date to determine whether there
is objective evidence that it is impaired. A financial asset is
impaired if objective evidence indicates that a loss event has
occurred after the initial recognition of the asset, and that the
loss event had a negative effect on the estimated future cash flows
of that asset that can be estimated reliably.
An impairment loss in respect of a financial asset measured at
amortised cost is calculated as the difference between its carrying
amount and the present value of the estimated future cash flows
discounted at the asset's original effective interest rate.
Interest on the impaired asset continues to be recognised through
the unwinding of the discount. When a subsequent event causes the
amount of impairment loss to decrease, the decrease in impairment
loss is reversed through profit or loss.
The carrying amounts of the Group's non-financial assets are
reviewed at each reporting date to determine whether there is any
indication of impairment. If any such indication exists, then the
asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is
the greater of its value in use and its fair value less costs to
sell. In assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money
and the risks specific to the asset. For the purpose of impairment
testing, assets that cannot be tested individually are grouped
together into the smallest group of assets that generates cash
inflows from continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the
"cash-generating unit").
An impairment loss is recognised if the carrying amount of an
asset or its cash generating unit exceeds its estimated recoverable
amount. Impairment losses are recognised in profit or loss.
Impairment losses recognised in respect of cash generated units are
allocated first to reduce the carrying amount of any goodwill
allocated to the units, and then to reduce the carrying amounts of
the other assets in the unit (group of units) on a pro rata
basis.
Impairment losses recognised in prior periods are assessed at
each reporting date for any indications that the loss has decreased
or no longer exists. An impairment loss is reversed if there has
been a change in the estimates used to determine the recoverable
amount. An impairment loss is reversed only to the extent that the
asset's carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if
no impairment loss had been recognised.
1.11 Employee benefits and other share based payment arrangements
Short-term benefits
Short-term employee benefit obligations are measured on an
undiscounted basis and are expensed as the related service is
provided.
Long-term benefits
The Group's net obligation in respect of long-term employee
benefits is the amount of the future benefit that employees have
earned in return for their service in the current and prior
periods; that benefit is discounted to determine its present value,
and the fair value of the related assets is deducted. The discount
rate is the yield at the reporting date on government bonds that
have maturity dates approximating the terms of the Group's
obligations and that are denominated in the same currency in which
the benefit is expected to be paid.
Defined contribution plans
A defined contribution plan is a post-employment benefit plan
under which the Group pays fixed contributions into a separate
entity and will have no legal or constructive obligation to pay
further amounts. Obligations for contributions to defined
contribution pension plans are recognised as an expense in the
profit or loss in the periods during which services are rendered by
employees.
Kolar Gold Limited and its controlled entities
Share-based payment transactions
Share-based payment arrangements in which the Group receives
goods or services as consideration for its own equity instruments
are accounted for as equity-settled share-based payment
transactions, regardless of how the equity instruments are obtained
by the Group.
Share-based transactions, other than those with employees, are
measured at the value of goods or services received where this can
be reliably measured. Where the services received are not
identifiable, their fair value is determined by reference to the
grant date fair value of the equity instruments provided. Should it
not be possible to measure reliably the fair value of identifiable
goods and services received, their fair value shall be determined
by reference to the fair value of the equity instruments provided
measured over the period of time that the goods and services are
received.
The expense is recognised in profit or loss (or capitalised as
part of an asset) when the goods are received or as services are
provided, with a corresponding increase in equity.
The grant date fair value of share-based payment awards granted
to employees is recognised as an employee expense, with a
corresponding increase in equity, over the period that the
employees become unconditionally entitled to the awards. The fair
value of the options granted is measured using an option valuation
model, taking into account the terms and conditions upon which the
options were granted. The amount recognised as an expense is
adjusted to reflect the actual number of awards for which the
related service and non-market vesting conditions are expected to
be met, such that the amount ultimately recognised as an expense is
based on the number of awards that do meet the related service and
non-market performance conditions at the vesting date. For
share-based payment awards with non-vesting conditions, the grant
date fair value of the share-based payment is measured to reflect
such conditions and there is no true-up for differences between
expected and actual outcomes.
Share-based payment transactions in which the Group receives
goods or services by incurring a liability to transfer cash or
other assets that is based on the price of the Group's equity
instruments are accounted for as cash-settled share-based payments.
The fair value of the amount payable to recipients is recognised as
an expense, with a corresponding increase in liabilities, over the
period in which the recipients become unconditionally entitled to
payment. The liability is re-measured at each balance sheet date
and at settlement date. Any changes in the fair value of the
liability are recognised in profit or loss.
1.12 Expenses
Operating lease payments
Payments made under operating leases are recognised in profit or
loss on a straight-line basis over the term of the lease. Lease
incentives received are recognised in profit or loss as an integral
part of the total lease expense.
Due diligence - GMSI and other prospective gold assets
These expenses relate to technical, legal and financial advisory
costs with respect to the agreements with GMSI and the assessment
of other prospective gold assets.
Financing income and expenses
Financing expenses comprise interest payable and finance charges
on shares classified as liabilities recognised in profit or loss
using the effective interest method, unwinding of the discount on
provisions, and net foreign exchange losses that are recognised in
the income statement (see foreign currency accounting policy note
1.5). Financing income comprise interest receivable on funds
invested, dividend income, and net foreign exchange gains.
Interest income and interest payable is recognised in profit or
loss as it accrues, using the effective interest method. Foreign
currency gains and losses are reported on a net basis.
1.13 Taxation
Tax on the profit or loss for the year comprises current and
deferred tax. Tax is recognised in profit or loss except to the
extent that it relates to items recognised directly in equity, in
which case it is recognised in equity.
Current tax is the expected tax payable or receivable on the
taxable income or loss for the year, using tax rates enacted or
substantively enacted at the balance sheet date, and any adjustment
to tax payable in respect of previous years.
Deferred tax is provided on temporary differences between the
carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. The following
temporary differences are not provided for: the initial recognition
of goodwill, the initial recognition of assets or liabilities that
affect neither accounting nor taxable profit other than in a
business combination, and differences relating to investments in
subsidiaries to the extent that they will probably not reverse in
the foreseeable future. The amount of deferred tax provided is
based on the expected manner of realisation or settlement of the
carrying amount of assets and liabilities, using tax rates enacted
or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is
probable that future taxable profits will be available against
which the temporary difference can be utilised.
1.14 Earnings per share
The Group presents basic and diluted earnings or loss per share
data for its ordinary shares. Basic earnings/loss per share is
calculated by dividing the profit or loss attributable to ordinary
shareholders of the Company by the weighted average number of
ordinary shares outstanding during the period, adjusted for own
shares held. Diluted earnings/loss per share is determined by
adjusting the profit or loss attributable to ordinary shareholders
and the weighted average number of ordinary shares outstanding,
adjusted for own shares held, for the effects of all dilutive
potential ordinary shares, which comprise convertible notes and
share options and warrants granted.
1.15 Operating segments
Segment results that are reported to the Chief Executive Officer
include items directly attributable to a segment as well as those
that can be allocated on a reasonable basis. Unallocated items
comprise mainly corporate assets, head office expenses, and income
tax assets and liabilities.
Segment capital expenditure is the total cost incurred during
the period to acquire plant and equipment, and intangible assets
other than goodwill.
1.16 Use of estimates and judgements
The preparation of financial statements in conformity with IFRSs
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. 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 and in any future periods
affected.
In particular, information about assumptions and estimation
uncertainties that have a significant risk of resulting in a
material adjustment within the next financial year are described in
the following notes:
-- measurement of share-based payments (note 9) is based on the
Black-Scholes formula, which requires estimates of expected
volatility in the Company's share price. These estimates have been
determined by considering historic share price volatility ;
-- capitalisation and carrying value of exploration and
evaluation expenditure (note 1.9 and note 6); and
-- going concern (note 1.3).
1.17 Adopted IFRS not yet applied
Amendments to:
-- IAS19 Employee benefits,
-- IFRS 1 First-time Adoption of International Financial Reporting Standards, and
-- IFRS 7. Financial Instruments: Disclosures
Have not yet been applied by the Group in these financial
statements.
2. Risk management
Overview
The Group has exposure to the following risks:
-- Credit risk;
-- Liquidity risk;
-- Tax risk;
-- Currency risk;
-- Market risk; and
-- Operational risk
This note presents information about the Group's exposure to
each of the above risks, its objectives, policies and processes for
measuring and managing risk, and its management of capital. Further
quantitative disclosures are included throughout these consolidated
financial statements.
Risk management framework
The Board of Directors has overall responsibility for the
establishment and oversight of the risk management framework and
developing and monitoring the Group's risk management policies. Key
risk areas have been identified and the Group's risk management
policies and systems will be reviewed regularly to reflect changes
in market conditions and the Group's activities.
The Audit Committee oversees how management monitors compliance
with the Group's risk management policies and procedures and
reviews the adequacy of the risk management framework in relation
to the risks faced by the Group.
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the
Group's bank deposits and receivables. The risk of non-collection
is considered to be low.
Liquidity risk
Liquidity risk is the risk that the Group will encounter
difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another
financial asset. The Group's approach to managing liquidity is to
ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Group's reputation.
Tax risk
The Company holds its investments in India through Kolar Gold
Resources Limited, a wholly owned Mauritian subsidiary.
A Tax Information Exchange Agreement is in place between
Guernsey and India.
The Group does not currently generate significant income in
India and its investment is capital in nature. Future tax
liabilities will be subject to how Indian tax law changes and how
the relevant double tax treaties are interpreted from time to
time.
Currency risk
The Group is exposed to currency risk on cash and cash
equivalents, receivables and payables that are denominated in a
currency other than the functional currency of the each of the
Group entities. In order to reduce currency risk, each entity holds
most of its funds in the same currency as its functional currency
in sufficient amounts to cover expected future outgoings for
several months. The Group does not use derivatives to hedge its
foreign currency exposures.
Market risk
The Group entered into agreements post year end to acquire a 30%
interest in GMSI. This exposes the Group to fluctuation in the
value of that equity investment - see note 17 - Subsequent events.
The Group is entitled to nominate one director to the board of GMSI
and will continue to work closely with GMSI to develop its
resources.
In addition, the Group's future revenues from product sales will
be affected by changes in the market price of gold and could also
be subject to exchange controls or similar restrictions.
Operational risk
The Group's business is at an early stage and is subject to
several operational risks. These risks include exploration and
mining risks, delays in approvals to undertake exploration
activities, actual resources differing from estimates, operational
delays and the availability of equipment, personnel and
infrastructure. The significantly larger portfolio of projects
resulting from the new agreements with GMSI will spread the risk
and impact of delays in licence approvals. In addition, the Group
has business and liability insurance policies in place to mitigate
some of these risks.
The Group is also dependent on key personnel and subject to the
actions of third parties, including staff of GMSI and other
contractors and suppliers.
The Group's operations are also subject to government laws and
regulations, particularly environmental regulation.
Capital management
In June 2011, the Company successfully completed the admission
of its shares to trading on AIM in London, raising gross proceeds
of GBP12m, netting approximately GBP11.3m. The Company has no loans
or borrowings and has sufficient resources, in the view of the
Directors, to meet its working capital requirements until early
calendar year 2016.
The Group manages its capital through the preparation of
detailed forecasts, and tracks actual receipts and outlays against
the forecasts on a regular basis, to ensure that entities in the
Group will be able to continue as a going concern while maximising
the return to shareholders.
The capital structure of the Group consists of cash and cash
equivalents and equity comprising, capital, reserves and
accumulated losses.
3. Operating segments
The Group has one reportable segment, being Indian Exploration -
Gold exploration activities and administration in the Kolar Gold
Fields region in Karnataka State, India.
The Group also has corporate administrative functions outside
India which generate corporate expenses that have not been
allocated to a segment.
The Group's Chief Executive Officer reviews internal management
reports for this segment on a monthly basis.
Information regarding the results of the reportable segment is
included below. The Group has no revenue at this stage of its
development and performance is measured based on expenses incurred
and exploration activity levels in the Indian segment.
Indian Exploration Corporate Total
2013 2012 2013 2012 2013 2012
GBP GBP GBP GBP GBP GBP
Income - - 267 - 267 -
---------- ---------- ------------ -------------- ------------ ------------
Depreciation and
amortisation 1,936 1,274 4,474 5,446 6,410 6,720
---------- ---------- ------------ -------------- ------------ ------------
Share-based payments - - 99,191 571,391 99,191 571,391
---------- ---------- ------------ -------------- ------------ ------------
Other reportable
segment expenses 46,748 256,230 2,041,846 1,642,059 2,088,594 1,898,289
---------- ---------- ------------ -------------- ------------ ------------
Segment result
before tax (48,684) (250,239) (2,145,244) (2,079,359) (2,193,928) (2,329,598)
---------- ---------- ------------ -------------- ------------ ------------
Reportable segment
assets 6,240,220 5,957,483 5,329,223 7,801,311 11,569,443 13,758,794
---------- ---------- ------------ -------------- ------------ ------------
Exploration and
evaluation expenditure
capitalised 6,122,168 5,496,153 - - 6,122,168 5,496,153
---------- ---------- ------------ -------------- ------------ ------------
Other capital
expenditure 846 5,772 - 5,520 846 11,292
---------- ---------- ------------ -------------- ------------ ------------
Reportable segment
liabilities (667) (109,722) (460,149) (495,739) (460,816) (605,461)
---------- ---------- ------------ -------------- ------------ ------------
4. Expenses and auditors' remuneration
2013 2012
GBP GBP
Included in loss for the year are the following:
Depreciation charge 6,410 6,720
================= ============
Operating lease expense 24,723 44,558
================= ============
Auditors' remuneration
Audit of financial statements 79,883 109,250
Other 6,209 -
----------------- ------------
Auditors' remuneration - audit of financial
statements 86,092 109,250
================= ============
5. Income tax expense
2013 2012
GBP GBP
Current tax expense
Current year - -
======== ==============
Deferred tax expense
Origination and reversal of temporary -
differences -
======== ==============
Tax expense in income statement - -
Reconciliation of effective
tax rate 2013 2013 2012 2012
% GBP % GBP
Loss for the year (2,193,928) (2,329,598)
Total income tax for the year - -
------------ --------------
Loss excluding income tax (2,193,928) (2,329,598)
------------ --------------
Income tax using the Company's
domestic rate (0.0) - (0.0) -
Effect of tax rates in foreign
jurisdictions (271,071) (305,409)
Non-deductible expenses 54,852 128,961
Current year losses for which
no deferred tax asset was recognised 216,219 176,448
Total current tax benefit - - - -
---------- ------------ -------- --------------
A deferred tax asset of GBP3,323,315 (2012: GBP3,107,096) has
not been recognised in respect of losses, as there is currently
uncertainty surrounding the recoverability of such assets.
6. Exploration and evaluation expenditure
2013 2012
GBP GBP
Balance at beginning of year 5,496,153 4,496,933
Drilling expenses capitalised - 295,409
Geological services 106,481 158,604
Consultant reports - 69,216
Salaries & wages 194,454 283,876
Advances to GMSI 300,000 -
Other expenses capitalised 25,080 192,115
----------------- ----------------
Balance at end of year 6,122,168 5,496,153
================= ================
On 16 August 2013 the Group announced that it had entered into
a binding Heads of Agreement ("HoA") with GMSI to invest funds
into GMSI and develop a number of advanced stage gold projects
in India, including the Jonnagiri Gold Project which already
has a JORC compliant Resource. The Group acquired a 30% equity
interest in GMSI in exchange for:
* a cash consideration of GBP700,000,
* the cancellation of a GBP300,000 advance by the Group
to GMSI during the reporting period, and
* the dissolution of the 2011 agreements with GMSI in
which the Group secure rights over the 14 Kolar
Gold Projects.
The GBP6,122,168 of exploration and evaluation expenditure
capitalised at 30 June 2013 is in relation to the 14 Kolar
Gold Projects, the rights over which will be returned to GMSI
as part of the acquisition. This amount increased to GBP6,822,168
upon the payment of the above cash consideration of GBP700,000.
Based on the value of the 30% shareholding acquired in GMSI,
the fair value less costs to sell the exploration and evaluation
assets at year end exceeded their carrying value and management
judge that no impairment is required.
2013 2012
GBP GBP
7. Trade and other payables
Trade and other payables due to related
parties - 41,438
Other trade payables 161,966 137,431
Non-trade payables and accrued expenses 159,484 244,644
------------ -----------
321,450 423,513
============ ===========
8. Employee benefits
Current
Liability for annual leave 66,175 87,481
Liability for long service leave 68,585 91,475
------------ --------------
134,760 178,956
Non-current
Liability for long service leave 4,606 2,992
------------ --------------
139,366 181,948
============ ==============
9. Share-based payments
a) Options
In prior periods, Kolar Gold (UK) Limited (previously Kolar Gold
Plc) and Kolar Gold Limited issued options to directors, employees
and long-term consultants to compensate them for services rendered
and incentivise them to add value to the Group's longer term share
value. When Kolar Gold Limited was created as the new holding company
of the Kolar Gold Group, options previously issued by Kolar Gold
(UK) Limited were exchanged for options over Kolar Gold Limited
shares. Options issued comprise "Reward" Options in exchange for
the provision of services and "Bonus" Options, which became receivable
upon Kolar Gold Limited being admitted to trading on AIM on 17
June 2011. Each option entitles the holder to subscribe for one
ordinary share in Kolar Gold Limited. Options do not confer any
voting rights on the holder.
As at 30 June 2013, the following unexpired options were is existence
over the shares of Kolar Gold Limited:
Name Date of Grant Ordinary Shares Expiry Date Exercise Price
under option GBP
Nicholas Taylor
Spencer (1) 1.12.10 500,000 1.12.13 0.30
Non-Directors (1) 1.12.10 350,000 1.12.13 0.30
Norman Coldham-Fussell
(2) 1.12.05 675,000 17.06.14 0.40
Nicholas Taylor
Spencer (2) 1.12.05 1,350,000 17.06.14 0.40
Richard Johnson
(2) 1.12.05 675,000 17.06.14 0.40
Harvinder Hungin
(3) 10.6.11 450,000 10.06.16 0.40
Stephen Coe (3) 10.6.11 350,000 10.06.16 0.40
Stephen Oke (3) 10.6.11 350,000 10.06.16 0.40
Harvinder Hungin
(4) 31.12.12 150,000 28.12.17 0.0838
Stephen Coe (4) 31.12.12 125,000 28.12.17 0.0838
Stephen Oke (4) 31.12.12 125,000 28.12.17 0.0838
----------------
5,100,000
================
(1) These share-based payment arrangements were originally in
relation to options issued by Kolar Gold plc and vested immediately
on grant date, having no vesting conditions. On 8 April 2011, these
options were released by the option holders in exchange for options
in Kolar Gold Limited. These options replaced the original options
on identical terms granted to the same persons; they vested on
grant date and are exercisable at any time before the date of lapse.
Each option confers a right to one ordinary share at exercise prices
of GBP0.30. The options are transferable, and on an alteration
of the ordinary share capital of the Company by capitalisation
or rights issue, consolidation, sub-division or reduction or other
alteration, the number of ordinary shares subject to the Existing
Options or the option price may be adjusted by the Board.
(2) The Directors and Shareholders of Kolar Gold plc had previously
resolved to grant options subject to completion of a successful
Initial Public Offering to Norman Coldham-Fussell, Nicholas Spencer
and Richard Johnson (Bonus Options) and a consultant. On admission
of the Company's shares to trading on AIM on 17 June 2011, the bonus
options were exchanged for options in respect of 2,700,000 Ordinary
Shares in Kolar Gold Limited. This resulted in a modification, with
2,000,000 bonus options being swapped for 2,700,000 reward options.
(3) The above options were granted by Kolar Gold Limited on 10 June
2011 to directors. The options vested on grant date with no vesting
conditions.
(4) The above options were granted by Kolar Gold Limited on 31 December
2012 to directors. The options vested on grant date with no vesting
conditions.
500,000 options expired on 8 March 2013 and 150,000 options expired
on 5 May 2013.
No other options were issued during the year ended 30 June 2013.
Inputs for measurement of grant date fair values
The grant date fair values of all options issued was measured based
on the Black-Scholes formula. Expected volatility is estimated by
considering historic average share price volatility. The inputs
used in the measurement of the fair values at grant date of the
share-based payment plans are the following:
Additional
options
Kolar Gold
Ltd
2013
GBP
Fair value at grant date 0. 051
Share price at grant date 0.0838
Exercise price 0.0838
Expected volatility 79.9%
Option life 5.0 years
Expected dividend nil
The number and weighted average exercise price of the options
are as follows:
Weighted average Weighted average
exercise price Number exercise price Number of
GBP of options GBP options
2013 2013 2012 2012
Options issued by Kolar
Gold Limited
Outstanding at the beginning
of the year 0.372 5,350,000 0.307 9,700,000
Granted during the year 0.0838 400,000 - -
Expired during the year 0.30 (650,000) 0.228 (4,350,000)
----------------- ------------ ----------------- ------------
0.3533 5,100,000 0.372 5,350,000
================= ============ ================= ============
b) Warrants
The following unexcercised warrants existed as at 30 June
2013:
Name Date Ordinary Shares Expiry Exercise
of Grant under option Date Price
GBP
Broker warrants Series
1 (1) 5.5.11 1,300,000 17.6.14 0.40
Broker warrants Series
2 (2) 17.6.11 1,500,000 17.6.14 0.60
2,800,000
================
Each warrant entitles the holder to subscribe for one ordinary
share in the Company. Warrants do not confer any voting rights
on the holder. On 30 June 2012, there were 12,132,989 warrants
in existence and on 4 January 2013 all 2,916,559 SUN Mining
Series 1 warrants were exercised and on 2 April 2013 all 2,916,559
SUN Mining Series 2 warrants were exercised. On 24 February
2013 3,499,871 SUN Mining additional warrants expired.
1 On 5 May 2011 the Company issued 1,000,000 warrants to Cenkos
Securities plc and 300,000 warrants to Ocean Equities Limited
in consideration for historical services provided by them
as brokers to Kolar Gold plc. These warrants have an exercise
price of 40 pence per share and expire on 17 June 2014.
2. On 17 June 2011 the Company's shares listed for trading
on AIM, entitling Cenkos Securities plc and Ocean Equities
Limited to 750,000 warrants each. These warrants have an
exercise price of 60 pence and expire on 17 June 2014.
Inputs for measurement of grant date fair values
The grant date fair values of warrants issued or agreed to be
issued were measured based on the Black-Scholes formula, or in the
case of the SUN Mining Additional Warrants, the Monte Carlo
simulation method was used.
Expected volatility is estimated by considering historic average
share price volatility. The inputs used in the measurement of the
initial fair values at grant date of the share-based payment plans
are the following:
Broker warrants Broker warrants
Series 1 Series 2
GBP GBP
Fair value at grant date 0.199 0.155
Share price at grant
date 0.40 0.40
Exercise price 0.40 0.60
Expected volatility 74.1% 74.1%
Warrant life 3.1 years 3 years
Expected dividend nil nil
* Volume weighted average price
Vesting conditions require that the charge for the SUN Mining
Initial warrants Series 1 and 2 be spread over the service period.
The fair value of the identifiable services received in exchange
for these warrants cannot be reliably measured under IFRS 2
therefore their fair value has been determined by reference to the
fair value of the equity instruments provided measured over the
period of time that the services are received. This has resulted in
a lower average fair value in the current year.
c) Share-based payment expense recognised in the income statement
2013 2012
GBP GBP
SUN Mining Initial warrants
Series 1 - 339,481
SUN Mining Initial warrants
Series 2 77,542 231,910
Options issued to non-executive
directors 21,649 -
Total share-based payment
expense 99,191 571,391
======= ========
10. Capital and reserves
Issued capital - Kolar Gold Limited
Ordinary Shares
a) Movement in issued and fully paid share capital: (7p each)
In issue at 1 July 2011 100,024,236
Issued to staff and consultants for services 127,560
----------------
In issue at 30 June 2012 100,151,796
================
In issue at 1 July 2012 100,151,796
Issued to staff and consultants for services 308,623
Issued to SUN Mining on exercise of warrants 5,833,118
In issue at 30 June 2013 106,293,537
================
b) Reconciliation to cash flows 2013
statement 2012
No. GBP No. GBP
Shares issued by Kolar Gold Limited
in lieu of cash for provision
of services at 16.07p per share 40,961 6,583 - -
Shares issued by Kolar Gold Limited
in lieu of cash for provision
of services at 9.84p per share 192,662 18,958 - -
Shares issued by Kolar Gold Limited
in lieu of cash for provision
of services at 40p per share 75,000 30,000 82,783 33,114
Shares issued by Kolar Gold Limited
in lieu of cash for provision
of services at 29.31p per share - - 44,777 13,124
308,623 55,541 127,560 46,238
======== ======= ======== =======
All shares issued by the Company are 'ordinary' shares and rank
equally in all respects, including for dividends, shareholder
attendance and voter rights at meetings, on a return of capital and
in a winding-up.
c) Reserves
Share premium reserve
The share premium reserve comprises the excess of consideration
received over the par value of the shares issued.
Share based payments reserve
The options reserve comprises the equity value of share based
payments issued by the Group.
Translation reserve
The translation reserve contains all foreign currency
differences arising from the translation of the financial
statements of foreign operations. Changes arising from monetary
items that are considered to be part of the net investment are also
included in the translation reserve.
11. Loss per share
The calculation of basic loss per share at 30 June 2013 was
based on the loss of GBP2,193,928 (2012: GBP2,329,598 ), and a
weighted average number of ordinary shares outstanding of
102,462,294 (2012: 100,124,647 ), calculated as follows:
2013 2012
GBP GBP
Loss attributable to ordinary shareholders 2,193,928 2,329,598
========== ==========
Weighted average number of ordinary
shares
'000 '000
Issued ordinary shares at 1 July 100,152 100,024
Effect of shares issued during
the year 2,310 101
---------- ----------
Weighted average number of shares
at 30 June 102,462 100,125
========== ==========
Diluted loss per share
Options and warrants granted to the Directors, staff and
external consultants are considered to be potential ordinary shares
and have not been included in the determination of diluted loss per
share because they are not considered to be dilutive. The options
have not been included in the determination of the basic loss per
share.
2013 pence 2012 pence
per share per share
Basic and diluted loss per share 2.14 2.33
12. Financial instruments
(a) Fair values of financial instruments
The fair values of all financial assets and financial
liabilities are equal to their carrying amounts shown in the
statement of financial position.
Trade and other receivables
The fair value of trade and other receivables is estimated as
the present value of future cash flows, discounted at the market
rate of interest at the balance sheet date if the effect is
material.
Trade and other payables
The fair value of trade and other payables is estimated as the
present value of future cash flows, discounted at the market rate
of interest at the balance sheet date if the effect is
material.
Cash and cash equivalents
The fair value of cash and cash equivalents is estimated as its
carrying amount where the cash is repayable on demand. Where it is
not repayable on demand then the fair value is estimated at the
present value of future cash flows, discounted at the market rate
of interest at the balance sheet date.
(b) Credit risk
Financial risk management
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the
Group's receivables and cash and cash equivalents. The carrying
amount of cash, cash equivalents and term deposits represents the
maximum credit exposure on those assets. The cash and cash
equivalents are held with bank and financial institution
counterparties which are rated at least A for Australian and UK
banks, and BBB for Indian banks, based on rating agency Standard
and Poor's ratings.
Exposure to credit risk
The carrying amount of financial assets represents the maximum
credit exposure. Therefore, the maximum exposure to credit risk at
the reporting date was GBP5,400,095 (2012: GBP8,186,716 ), being
the total of the carrying amount of financial assets, shown in the
statement of financial position.
The maximum exposure to credit risk for trade and other
receivables at the balance sheet date was:
2013 2012
GBP GBP
The maximum exposure to credit risk for
receivables at the reporting date by geographic
region was:
Australia 8,928 11,971
United Kingdom 15,727 19,985
India 4,889 22,868
------- -------
29,544 54,824
======= =======
The maximum exposure to credit risk for
receivables at the reporting date by type
of counterparty was:
Australian government 2,478 6,714
Other parties 27,066 48,110
------- -------
29,544 54,824
======= =======
No impairment losses have been recognised in 2012 and 2013.
(c) Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due.
The following are the contractual maturities of financial
liabilities, including estimated interest payments and excluding
the impact of netting agreements.
Financial liabilities Carrying Contractual 6 months 6-12 1 -2 years
amount cash flows or less months
GBP GBP GBP GBP GBP
30 June 2013
Trade and other
payables 321,450 321,450 304,563 1,959 14,928
========= ============ ========= ======== ===========
30 June 2012
Trade and other
payables 423,513 423,513 389,447 34,066 -
========= ============ ========= ======== ===========
(d) Currency risk
The Group's exposure to foreign currency risk is as follows.
This is based on the carrying amount for monetary financial
instruments which are held in a currency that differs from that
entity's functional currency, except derivatives when it is based
on notional amounts.
2013 2012
GBP GBP
Cash and cash equivalents - A$ and INR 129,415 8,431
Trade and other payables - US$ (46,540) (5,478)
--------- --------
82,875 2,953
========= ========
The following significant exchange rates applied during the
year:
Average rate Reporting date spot rate Average rate Reporting date spot rate
2013 2013 2012 2012
GBP:A$ 1.5301 1.66287 1.5352 1.53671
GBP:INR 85.85 90.6375 79.8566 87.5275
GBP:US$ 1.5687 1.52084 1.5905 1.56148
Sensitivity analysis
A strengthening of the GBP, as indicated below, against the
Australian dollar and Indian Rupee at 30 June 2013 would have
decreased equity by the amount shown below. This analysis is on
foreign currency exchange rate variances that the Group considered
to be reasonably possible at the end of the reporting period. The
analysis assumes that all other variables, in particular interest
rates, remain constant.
Equity Profit or loss
GBP GBP
30 June 2013
A$ (10 percent strengthening) 12,942 -
US$ (10 percent strengthening) (4,654) -
-------- ---------------
30 June 2012
A$ (10 percent strengthening) 843 -
US$ (10 percent strengthening) (548) -
======== ===============
A weakening of the GBP against the Australian dollar and Indian
Rupee at 30 June would have had the equal but opposite effect on
the amounts shown above, on the basis that all other variables
remain constant.
(e) Interest rate risk
Profile
At the reporting date the interest rate profile of
interest-bearing financial instruments was:
Carrying amount
2013 2012
GBP GBP
Variable rate instruments
Cash and cash equivalents 698,817 8,131,892
Term deposits 4,671,734
5,370,551 8,131,892
========== ==========
Cash flow sensitivity analysis for variable rate instruments
The Group's interest bearing assets at balance date were
invested with financial institutions with a minimum rating (S&P
long term rating) of A for Australian and UK banks, and BBB for
Indian banks and comprised solely bank accounts.
A change in interest rates would have increased/(decreased)
profit or loss by the amounts shown below. This analysis assumes
that all other variables, in particular foreign currency rates,
remain constant. This analysis is performed on the same basis for
2013.
2013 2012
Profit or loss Profit or loss
100 bp increase 100 bp decrease 100 bp increase 100 bp decrease
Variable rate instruments 53,706 (53,706) 81,319 (81,319)
================ ================ ================ ================
13. Operating leases
2013 2012
Non-cancellable operating lease rentals are payable as follows: GBP GBP
Less than one year 23,692 18,937
Between one and five years 44,902 83,409
------- --------
68,594 102,346
======= ========
14. Contingencies and commitments
In 2011 the Group has entered into a contract with Geomysore
Services (India) Pvt Ltd ('GMSI') to purchase outstanding options
over, and undertake exploration activity in relation to certain
mineral exploration tenements in the Kolar Gold Fields region in
India. This contract entitled the Group to purchase these options
at a total cost of GBP4.4 million, once all governmental and
regulatory approvals have been obtained.
On 16 August 2013 the Group entered into agreements in which the
Group waived these option rights in exchange for an equity interest
in GMSI (See Note 17 - Subsequent events).
15. Group entities
Country of Ownership interest
incorporation 2013 2012
Kolar Gold Resources Limited (i) Mauritius 100% 100%
Kolar Gold Resources (India) Private Limited (ii) India 100% 100%
Kolar Gold Pty Ltd Australia 100% 100%
Kolar Gold plc (iii) England - 100%
(i) Incorporated on 3 March 2011
(ii) Incorporated on 24 March 2011
(iii) Struck off the Companies House register on 23 May 2012.
16. Related parties
Key management personnel
2013 2012
Key management personnel remuneration GBP GBP
Cash-settled transactions 838,746 1,044,845
Share-based payments 48,958 7,292
-------- ----------
887,704 1,052,137
======== ==========
In addition to their salaries and fees, key management personnel
participate in the Group's share option programme (see Note 9).
Directors' remuneration and interests
2013 Remuneration Interests
Cash-settled
transactions Share-based payments Totals Shares Options
GBP GBP GBP No. No.
Harvinder Hungin (Chairman) 45,000 8,119 53,119 1,700,000(1) 600,000(1)
Nicholas Spencer (Chief
Executive Officer) -
- Salary 236,621 12,588 249,209 - -
- Superannuation 22,131 - 22,131 - -
----------------------- --------------------- -------- ------------- -----------
Total 258,752 12,588 271,340 1,763,569 1,850,000
----------------------- --------------------- -------- ------------- -----------
Richard Johnson (Chief
Operating Officer)
- Salary 95,885 - 95,885 n/a n/a
- Superannuation 29,239 - 29,239 n/a n/a
- Termination pay 110,000 - 110,000 n/a n/a
----------------------- --------------------- -------- ------------- -----------
Total 235,124 - 235,124
----------------------- --------------------- -------- ------------- -----------
Stephen Coe (2) 27,708 14,057 41,765 237,439 475,000
Stephen Oke 40,000 6,765 46,765 Nil 475,000
Shiv Khemka 30,000 - 30,000 Nil Nil
----------------------- --------------------- -------- ------------- -----------
TOTALS 636,584 41,529 678,113 3,701,008 3,400,000
================================ ======================= ===================== ======== ============= ===========
2012 Remuneration Interests
Cash-settled
transactions Share-based payments Totals Shares Options
GBP GBP GBP No. No.
Harvinder Hungin (Chairman) 45,000 - 45,000 1,700,000(1) 450,000(1)
Nicholas Spencer (Chief
Executive Officer)
- Salary 249,501 - 249,501 - -
- Superannuation 22,129 - 22,129 - -
- Back pay 73,584 - 73,584 - -
- Listing bonus 120,000 - 120,000 - -
----------------------- --------------------- -------- ------------- -----------
Total 465,214 - 465,214 1,763,569 1,850,000
----------------------- --------------------- -------- ------------- -----------
Richard Johnson (Chief
Operating Officer) 239,800 - 239,800 725,000 1,175,000
Stephen Coe (2) 17,500 17,500 35,000 44,777 350,000
Stephen Oke 40,000 - 40,000 Nil 350,000
Shiv Khemka 30,000 - 30,000 Nil Nil
----------------------- --------------------- -------- ------------- -----------
TOTALS 837,514 17,500 855,014 4,233,346 4,375,000
================================ ======================= ===================== ======== ============= ===========
(1.) SG Hambros Trust Company (Channel Islands) Limited hold
1,700,000 Ordinary Shares, as trustee of the Carlyle Settlement, in
which Harvinder Hungin and his family have an interest.
(2.) 50% of Stephen Coe's Director's fees was paid by the issue
of shares until December 2012.
Amounts owing to directors at 30 June 2013 were Nil (2012:
GBP13,125).
SUN Mining is a related party, as Shiv Khemka, Vice Chairman of
SUN Group was a director until 14(th) August 2013, when he was
replaced by Vaidyanathan Sivakumar, a director of SUN Group.
SUN Group holds 11,666,237 (2012: 5,833,119) shares in the
Company.
The amounts paid to SUN Group are disclosed in the Consolidated
Statement of Comprehensive Income and also in Note 9. The balance
outstanding at the year end was nil.
17. Subsequent events
On 16 August 2013 the Groupannounced that it had entered into a
binding Heads of Agreement ("HoA") with GMSI (see Note 1.3 and Note
6) to invest funds into GMSI and develop a number of advanced stage
gold projects in India, including the Jonnagiri Gold Project which
already has a JORC compliant Resource. This results in a disposal
of the Group's Exploration assets and in exchange the Group
acquired a 30% equity interest in GMSI in exchange for:
-- a cash consideration of GBP700,000,
-- the cancellation of a GBP300,000 advance made by the Group to
GMSI during the reporting period, and
-- the dissolution of the 2011 agreements with GMSI in which the
Group secure rights over the 14 Kolar
Gold Projects.
Independent auditor's report to the members of Kolar Gold
Limited
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UKVBROSAAAAA
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