TIDMPFP
RNS Number : 5674A
Pathfinder Minerals Plc
25 May 2023
25 May 2023
Pathfinder Minerals Plc
("Pathfinder" the "Company")
Final Results for the Year Ended 31 December 2022
Pathfinder reports its audited financial results for the year
ended 31 December 2022. The full annual report including, all notes
to the accounts, will be posted to shareholders on 26 May 2023, and
is available on the Company's website at www.pathfinderminerals.com
.
Dennis Edmonds, Chairman, commented:
"Following the completion of the disposal of IM Minerals
Limited, which the Company expects imminently, Acumen Advisory
Group LLC will have a binding agreement with the Company to
progress the claim against the Government of Mozambique. If the
claim is successful, Pathfinder stands to receive a substantial
contingent payment. While that process is underway, assuming
completion of the disposal, Pathfinder will be well funded to
pursue other opportunities to achieve value creation for
shareholders."
Enquiries:
Pathfinder Minerals Plc
Peter Taylor, Chief Executive Officer
Tel. +44 (0)20 3143 6748
Strand Hanson Limited (Nominated & Financial Adviser and
Broker)
James Spinney / Ritchie Balmer / Abigail Wennington
Tel. +44 (0)20 7409 3494
Vigo Consulting (Public Relations)
Ben Simons / Kate Kilgallen
Tel. +44 (0)20 7390 0234
Email pathfinderminerals@vigoconsulting.com
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
Chairman's Statement
for the Year Ended 31 December 2022
Introduction and principal activities
The Group's activities during 2022 continued to focus on
preparing the Company to bring a claim against the Government of
Mozambique, under the Mozambique-United Kingdom Bilateral
Investment Treaty (2004) (the "Treaty"), for its role in
facilitating the expropriation of Mining Concession 4623C (the
"Licence") from the Company in 2011 through a transfer which the
Board believes was unlawful (the "Claim"). This culminated in the
signing in September 2022 of an option agreement for the sale of IM
Minerals Limited ("IMM"), a wholly owned subsidiary of Pathfinder,
and, with it, the rights to bring the Claim.
Alongside this, the Board has continued to review additional
commercial opportunities across several minerals and geographies
which, if pursued, would offer shareholders multiple avenues for
potential value creation.
Preparations to bring or monetise a claim
Since the receipt in December 2020 of a legal opinion that,
subject to the interpretation of the facts and applicable laws as
they are currently known to the Board and Counsel, there is a 55-60
percent prospect of establishing liability on the part of the
Government of Mozambique in a BIT claim under Article 2(2) and 2(3)
of the Treaty, the Board had set about undertaking the various
workstreams to prepare to bring or monetise the Claim.
As part of the Company's preparatory procedures, the Board
commissioned, during 2021, Versant Partners LLC ("Versant") to
undertake an analysis of the valuation of Pathfinder's potential
claim. Whilst the detail behind the valuation remains legally
privileged, the Versant analysis assesses a range of successful
scenarios with valuation ranges from a minimum of US$110m for an
ex-ante damages award through to US$1,500m for an ex-post damages
award. The Versant valuation supports the US$621.3m of estimated
losses, detailed in the Company's 12 April 2021 announcement, that
has been notified to the government of Mozambique.
In September 2022, the Company entered into an option agreement
with Acumen Advisory Group LLC ("Acumen" or "AAG"), an asset
recovery specialist incorporated in Delaware, USA, with a track
record of international claim enforcement, under which the Company
granted Acumen an exclusive option to acquire IMM and therefore the
rights to bring the Claim.
Following the end of the financial year, on 1 February 2023,
Pathfinder announced that Acumen had sought to exercise its rights
under the Option and, at a general meeting of shareholders of the
Company held on 11 May 2023, shareholders voted to proceed with the
disposal of IMM and therefore the Claim (the "Disposal"). Under the
terms of the Sale and Purchase Agreement (the "SPA") entered into
with Acumen, the Company expects to receive imminently, an initial
cash payment of GBP2 million and subsequently a further payment
being the greater of US$24 million or 20% of the aggregate amount
(including deferred or conditional payments) subject to, and
payable on, settlement or determination of the Claim, less
expenses. Further details on the Disposal, including the payment
mechanism, and associated risk factors, are detailed in the
circular posted to shareholders on 21 April 2023.
Company strategy
Following the completion of the Disposal, the Company will cease
to own, control, or conduct all, or substantially all, of its
existing business activities or assets. Accordingly, upon
completion of the Disposal, the Company will be classified as an
AIM Rule 15 cash shell and, as such, will be required to make an
acquisition or acquisitions which constitute a reverse takeover
under AIM Rule 14 (or seek re-admission as an investing company (as
defined under the AIM Rules)), on or before the date falling six
months from completion of the Disposal, failing which the Company's
Ordinary Shares would be suspended from trading on AIM pursuant to
AIM Rule 40. Admission of the Company's Ordinary Shares to trading
on AIM would be cancelled six months from the date of suspension
should the Company not complete such a transaction during this
time.
Until such time as the GBP2 million has been received by the
Company, the Disposal will not complete and the Company will not be
classified as an AIM Rule 15 cash shell.
The Board is continuing to evaluate opportunities in the sectors
it considers appropriate, seeking to identify one or more projects
or assets suitable for acquisition from which the Board believes it
can unlock unrealised value for shareholders in the near-term.
Any reverse takeover transaction will require the publication of
an AIM Rules compliant admission document and will be subject to
shareholder approval at a further general meeting of the Company to
be convened at the appropriate time.
Financial results and current financial position
The audited financial statements of the Pathfinder Group for the
year ended 31 December 2022 follow later in this report.
The Income Statement for the period ended 31 December 2022
reflects a loss of GBP376k (period ended 31 December 2021:
GBP367k). The Group's Statement of Financial Position shows total
assets at 31 December 2022 of GBP59k (31 December 2021: GBP384k);
the assets were held largely in the form of cash deposits of GBP46k
(31 December 2021: GBP365k).
Board changes
Jonathan Summers retired as a non-executive director of the
Company on 30 June 2022. The Board is grateful to Mr Summers for
his contribution to the Company.
Outlook
Following the completion of the Disposal, which the Company
expects imminently, Acumen will have a binding agreement with the
Company to progress the Claim. If the Claim is successful, the
Company stands to receive a substantial contingent payment. While
that process is underway, assuming completion of the Disposal,
Pathfinder will be well funded and able to pursue other
opportunities which offer shareholders multiple avenues for value
creation.
Dennis Edmonds
Chair
25 May 2023
Consolidated Statement of Comprehensive Income
for the Year E nded 31 December 2022
Year ended Year ended
31 December 31 December
Note 2022 2021
GBP'000 GBP'000
CONTINUI NG OP ERATIONS
Re v e nue - -
Ad ministrati ve exp e ns es 3, 4 (376) (367)
OPE R ATING LOSS (376) (367)
-------------------------------------------- ---- ------------ --------------
LOSS B EFORE INCOME TAX (376) (367)
Income tax 5 - -
LOSS FOR THE Y EAR (376) (367)
-------------------------------------------- ---- ------------ --------------
Total comprehensive lo ss for the year
attributable to equity holders of the
parent (376) (367)
Loss p er s hare from continuing operations
in p e nce p er s hare: 7
Basic and diluted (0.07) (0.07)
Consolidated Statement of Financial Position
for the Year E nded 31 December 2022
Year ended Year ended
31 December 31 December
Note 2022 2021
GBP'000 GBP'000
NON-CURRENT ASSETS
Investments 8 - -
CURRENT ASSETS
Trade and other receivables 9 13 19
Cash and cash equivalents 10 46 365
TOTAL ASSETS 59 384
-------------------------------------- ----- ------------- -------------
EQUITY AND LIABILITIES
Capital and reserves attributable to
equity holders of the Company:
Share capital 11 18,717 18,716
Share premium 11 14,239 14,234
Share based payment reserve 162 199
Warrant reserve 104 255
Accumulated deficit (33,357) (33,169)
-------------------------------------- ----- ------------- -------------
TOTAL EQUITY (135) 235
CURRENT LIABILITIES
Trade and other payables 12 114 149
Borrowings 13 80 -
-------------------------------------- ----- ------------- -------------
TOTAL LIABILITIES 194 149
TOTAL EQUITY AND LIABILITIES 59 384
-------------------------------------- ----- ------------- -------------
T h e financial statem e nts we re appro ved for issue by the
Board of Directors on 25 May 2023 and w ere signed on its b e half
by:
Dennis Edmonds
Director
Consolidated Statement of Changes in Equity
for the Year E nded 31 December 2022
Share
Called based
up share Share payment Warrant Accumulated Total
capital premium reserve reserve deficit equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2021 as previously
stated 18,584 13,685 184 253 (32,831) (125)
Prior year adjustment - - - - - -
Balance at 1 January
2021 as restated 18,584 13,685 184 253 (32,831) (125)
------------------------ ---------- --------- --------- --------- ------------ --------
Loss for the year - - - - (367) (367)
------------------------ ---------- --------- --------- --------- ------------ --------
Total comprehensive
loss for the year - - - - (367) (367)
------------------------ ---------- --------- --------- --------- ------------ --------
Issue of share capital 132 599 - - - 731
Cost of share issue - (41) - - - (41)
Share based payments - (9) 15 2 29 37
------------------------ ---------- --------- --------- --------- ------------ --------
Balance at 31 December
2021 18,716 14,234 199 255 (33,169) 235
------------------------ ---------- --------- --------- --------- ------------ --------
Loss for the year - - - - (376) (376)
Total comprehensive
loss for the year - - - - (376) (376)
------------------------ ---------- --------- --------- --------- ------------ --------
Issue of share capital 1 5 - - - 6
Cost of share issue - - - - - -
Share based payments - - (37) (151) 188 -
Balance at 31 December
2022 18,717 14,239 162 104 (33,357) (135)
------------------------ ---------- --------- --------- --------- ------------ --------
Consolidated Statement o f Cash Fl ows
for the Year E nded 31 December 2022
Note Year ended Year ended
31 December 31 December
2022 2021
GBP'000 GBP'000
Cash flows from operating activities
Loss before tax (376) (367)
Adjustments for:
Share-based payments - 35
PAYE/NI provision written back - (140)
-------------------------------------------- ----- ------------- -------------
Net cash flow from operating activities
before changes in working capital (376) (472)
Changes in working capital:
Decrease in trade and other receivables 9 6 15
Decrease in trade and other payables 12 (35) (61)
-------------------------------------------- ----- ------------- -------------
Net cash flow used in operating activities (405) (518)
Cash flow from financing activities
Proceeds arising as a result of the
issue of ordinary shares 6 720
Costs related to issue of ordinary
share capital - (28)
Proceeds of borrowings 13 80 -
-------------------------------------------- ----- ------------- -------------
Net cash flow from financing activities 86 692
Net increase in cash and cash equivalents
in the year (319) 174
Cash and cash equivalents at beginning
of the year 365 191
-------------------------------------------- ----- ------------- -------------
Cash and cash equivalents at end of
the year 46 365
-------------------------------------------- ----- ------------- -------------
Details of material non-cash transactions are set out in note 17
.
Company Statement of Financial Position
for the Year E nded 31 December 2022
Year ended Year ended
31 December 31 December
Note 2022 2021
GBP'000 GBP'000
NON-CURRENT ASSETS
Investments 8 - -
CURRENT ASSETS
Trade and other receivables 9 13 19
Cash and cash equivalents 10 46 365
TOTAL ASSETS 59 384
-------------------------------------- ----- ------------- -------------
EQUITY AND LIABILITIES
Capital and reserves attributable to
equity holders of the Company:
Share capital 11 18,717 18,716
Share premium 11 14,239 14,234
Share based payment reserve 162 199
Warrant reserve 104 252
Accumulated deficit (33,357) (33,169)
-------------------------------------- ----- ------------- -------------
TOTAL EQUITY (135) 235
CURRENT LIABILITIES
Trade and other payables 12 114 149
Borrowings 13 80 -
-------------------------------------- ----- ------------- -------------
TOTAL LIABILITIES 194 149
TOTAL EQUITY AND LIABILITIES 59 384
-------------------------------------- ----- ------------- -------------
The Company has taken exemptions allowed under section 408 of
the Companies Act 2006 and has not presented its own profit and
loss account in these financial statements. The loss after tax of
the parent Company for the year was GBP376k (2021: GBP367k).
The financial statements were approved and authorised for issue
by the Board of Directors on 25 May 2023 and were signed on its
behalf by:
Dennis Edmonds
Director
Company Statement of Changes in Equity
for the Year E nded 31 December 2022
Share
Called based
up share Share payment Warrant Accumulated Total
capital premium reserve reserve deficit equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2021 as previously
stated 18,584 13,685 184 253 (32,831) (125)
------------------------ ---------- --------- --------- --------- ------------ --------
Prior year adjustment - - - - - -
Balance at 1 January
2021 as restated 18,584 13,685 184 253 (32,831) (125)
Loss for the year - - - - (367) (367)
Total comprehensive
loss for the year - - - - (367) (367)
------------------------ ---------- --------- --------- --------- ------------ --------
Issue of share capital 132 599 - - - 731
Cost of share issue - (41) - - - (41)
Share based payments - (9) 15 2 29 37
------------------------ ---------- --------- --------- --------- ------------ --------
Balance at 31 December
2021 18,716 14,234 199 255 (33,169) 235
------------------------ ---------- --------- --------- --------- ------------ --------
Loss for the year - - - - (376) (376)
------------------------ ---------- --------- --------- --------- ------------ --------
Total comprehensive
loss for the year (376) (376)
------------------------ ---------- --------- --------- --------- ------------ --------
Issue of share capital 1 5 - - - 6
Share based payments - - (37) (151) 188 -
Balance at 31 December
2022 18,717 14,239 162 104 (33,357) (135)
------------------------ ---------- --------- --------- --------- ------------ --------
Company Statement of Cash Flows
for the Year E nded 31 December 2022
Note Year ended Year ended
31 December 31 December
2022 2021
GBP'000 GBP'000
Cash flows from operating activities
Loss before tax (376) (367)
Adjustments for:
Share-based payments - 35
PAYE/NI provision written back - (140)
-------------------------------------------- ----- ------------- -------------
Net cash flow from operating activities
before changes in working capital (376) (472)
Changes in working capital:
Decrease in trade and other receivables 9 6 15
Decrease in trade and other payables 12 (35) (61)
-------------------------------------------- ----- ------------- -------------
Net cash flow used in operating activities (405) (518)
Cash flow from financing activities
Proceeds arising as a result of the
issue of ordinary shares 6 720
Costs related to issue of ordinary
share capital - (28)
Proceeds of borrowings 13 80 -
-------------------------------------------- ----- ------------- -------------
Net cash flow from financing activities 86 692
Net increase in cash and cash equivalents
in the year (319) 174
Cash and cash equivalents at beginning
of the year 365 191
-------------------------------------------- ----- ------------- -------------
Cash and cash equivalents at end of
the year 46 365
-------------------------------------------- ----- ------------- -------------
Details of material non-cash transactions are set out in note 17
.
No tes to the C onsoli dated Fi nanc ial Statements
for the Year E nded 31 December 2022
1. ACCOU N TING P O LICIES
General information
Pathfinder Minerals Plc is a public limited company, quoted on
AIM and is incorporated, registered and domiciled in England.
The Company's registered office is 35 Berkeley Square, London,
England, W1J 5BF.
B asis of preparation
These financial statements have been prepared in accordance with
UK-adopted International Accounting Standards as issued by the
International Accounting Standards Board (IASB) and Interpretations
(collectively IASs) and with those parts of the Companies Act 2006
applicable to companies reporting under IASs. The financial
statements have been prepared under the historical cost convention.
The functional and presentational currency of the Company is Pound
Sterling.
New standards, amendments and interpretations adopted by the
Company
At the date of authorisation of these financial statements, the
following standards and interpretations relevant to the Company and
which have not been applied in these financial statements, were in
issue but were not yet effective.
Standard Effective date,
annual period
beginning on
or after
IAS 1 - Presentation of Financial Statements 1 January 2023
----------------
IFRS 17 - Insurance Contracts 1 January 2023
----------------
IAS 8 amendments - Definition of accounting 1 January 2023
estimates
----------------
Amendments to IAS 12 - Deferred Tax related 1 January 2023
to Assets and Liabilities arising from a
Single Transaction
----------------
Classification of Liabilities as Current 1 January 2023
or Non-Current: Amendments to IAS 1
----------------
The adoption of these standards is not expected to have any
material impact on the financial statements of the Company.
Going concern
The Directors maintain cash flow forecasts looking ahead for
periods not less than 12 months. As at the reporting date, the
Company's cash balance was GBP46k (2021: GBP365k).
As at the date of approval of the financial statements, the cash
flow forecast indicates that the Company has sufficient financial
resources for at least the next 12 months, however, this is
predicated on the receipt of GBP2 million consideration from AAG in
respect of the disposal of the Company's 100%-owned subsidiary, IM
Minerals Limited. The Board therefore considers that this is a
material uncertainty which may cast significant doubt about the
Group's and the Company's ability to continue as a going
concern.
Taking into consideration the Board's expectation that these
funds will be received imminently, the Group's merits and the
Board's track record in raising additional funding, the Board, has
a reasonable expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over the next
12 months. Based on the Group's current expenditure plans, in the
absence of receipt of the GBP2 million consideration from AAG, and
without further funding being raised, the Group is funded up to
October 2023.
The Board considers this period of assessment to be appropriate
because it contextualises the Company's financial position,
business model and strategy.
Notwithstanding the above, the directors consider the Group and
the Company to be a going concern and therefore have prepared these
financial statements on a going concern basis.
Basis of consolidation
Although the Company's direct subsidiary as at 31 December 2022,
IM Minerals Limited holds 99.9% of the issued share capital of
Companhia Mineira de Naburi SARL, which in turn holds 99.8% of the
issued share capital of Sociedade Geral de Mineracao de Moçambique
SARL, events in 2011 indicated that the Company does not control
either of these Moçambique-domiciled companies group companies;
neither has it been possible to obtain the statutory registers or
audited accounts for them; accordingly, these financial statements
consolidate the financial statements of IM Minerals Limited only.
IM Minerals Limited is a dormant intermediate holding company
registered in England & Wales.
Foreign currencies
Assets and liabilities in foreign currencies are translated into
sterling at the rates of exchange ruling at the statement of
financial position date. Transactions in foreign currencies are
translated into sterling at the rate of exchange ruling at the date
of transaction. Exchange differences are considered in arriving at
the operating result.
Employee benefit costs
The Group makes available a defined contribution pension scheme
to eligible employees. Any contributions paid to the Group's
pension scheme are charged to the income statement in the period to
which they relate.
Equity instruments and reserves description
An equity instrument is any contract that evidences a residual
interest in the assets of the Company after deducting all of its
liabilities. Equity instruments issued by the Company are recorded
at the proceeds received net of direct issue costs.
Ordinary shares are classified as equity.
Deferred shares are classified as equity but have restricted
rights such that they have no economic value.
Share capital account represents the nominal value of the
ordinary and deferred shares issued.
The share premium account represents premiums received on the
initial issuing of the share capital. Any transaction costs
associated with the issuing of shares are deducted from share
premium, net of any related income tax benefits.
Share based payment reserve represents equity-settled
share-based employee remuneration until such share options are
exercised.
Warrant reserve represents equity-settled share-based payments
until such share warrants are exercised.
Share-based payments
Where equity settled share options or warrants are awarded, the
fair value of the options at the date of grant is charged to the
statement of comprehensive income over the vesting period.
Non-market vesting conditions are considered by adjusting the
number of equity instruments expected to vest at each balance sheet
date so that, ultimately, the cumulative amount recognised over the
vesting period is based on the number of options that eventually
vest.
Financial instruments
Trade and other receivables
Trade receivables are measured at initial recognition at fair
value and are subsequently measured at amortised cost using the
effective interest rate method. Trade and other receivables are
accounted for at original invoice amount less any provisions for
doubtful debts. Provisions are made where there is evidence of a
risk of non-payment, considering the age of the debt, historical
experience and general economic conditions. If a trade debt is
determined to be uncollectable, it is written off, firstly against
any provisions already held and then to the statement of
comprehensive income. Subsequent recoveries of amounts previously
provided for are credited to the statement of comprehensive
income.
Appropriate allowances for estimated irrecoverable amounts are
recognised in profit or loss in accordance with the expected credit
loss model under IFRS 9. For trade and other receivables which do
not contain a significant financing component, the Company applies
the simplified approach. This approach requires the allowance for
expected credit losses to be recognised at an amount equal to
lifetime expected credit losses. For other debt financial assets,
the Company applies the general approach to providing for expected
credit losses as prescribed by IFRS 9, which permits for the
recognition of an allowance for the estimated expected loss
resulting from default in the subsequent 12-month period. Exposure
to credit loss is monitored on a continual basis and, where
material, the allowance for expected credit losses is adjusted to
reflect the risk of default during the lifetime of the financial
asset should a significant change in credit risk be identified.
The majority of the Company's financial assets are expected to
have a low risk of default. A review of the historical occurrence
of credit losses indicates that credit losses are insignificant due
to the size of the Company's clients and the nature of its
activities. The outlook for the natural resources industry is not
expected to result in a significant change in the Company's
exposure to credit losses. As lifetime expected credit losses are
not expected to be significant the Company has opted not to adopt
the practical expedient available under IFRS 9 to utilise a
provision matrix for the recognition of lifetime expected credit
losses on trade receivables. Allowances are calculated on a
case-by-case basis based on the credit risk applicable to
individual counterparties.
Trade and other payables
Trade and other payables are held at amortised cost which
equates to nominal value.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, current
balances with banks and similar institutions and liquid investments
generally with maturities of 3 months or less. They are readily
convertible into known amounts of cash and have an insignificant
risk of changes in values.
Taxation
The tax expense represents the sum of the tax currently payable
and deferred tax.
The tax currently payable is based on taxable profit for the
period. Taxable profit differs from the net profit as reported in
the income statement because it excludes items of income or expense
that are taxable or deductible in other periods and it further
excludes items that are never taxable or deductible. The Company's
liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the balance sheet
date.
Provisions
Provisions are recognised when the Company has a present
obligation as a result of a past event, it is probable that the
Company will be required to settle that obligation and a reliable
estimate can be made of the amount of the obligation. The amount
recognised as a provision is the best estimate of the consideration
required to settle the present obligation at the balance sheet
date, taking into account the risks and uncertainties surrounding
the obligation.
Critical accounting estimates and judgements
The preparation of financial information in accordance with
generally accepted accounting practice, in the case of the Group
using IFRSs, requires the directors to make estimates and
judgements that affect the reported amount of assets, liabilities,
income and expenditure and the disclosures made in the financial
statements. Such estimates and judgements must be continually
evaluated based on historical experience and other factors,
including expectations of future events.
Details of accounting estimates and judgements that have the
most significant effect on the amounts recognised in the financial
statements have been disclosed under the relevant note or
accounting policy for each area where disclosure is required.
Valuation of share-based payments to employees
The Company estimates the expected value of share-based payments
to employees and this is charged through the income statement over
the vesting period. The fair value is estimated using the Black
Scholes valuation model which requires a number of assumptions to
be made such as level of share vesting, time of exercise, expected
length of service and employee turnover and share price volatility.
This method of estimating the value of share-based payments is
intended to ensure that the actual value transferred to employees
is provided for by the time such payments are made.
2. SEG M E N T A L R EPORTING
The Group has one activity only. The whole of the value of the
Group's and the Company's net assets in their respective financial
statements at 31 December 2022 and 2021 was attributable to UK
assets and liabilities.
3. OPER A TING LOSS
Group and Company
2022 2021
GBP'000 GBP'000
Lo ss from operations has been arrived at after
charging:
Directors' Remuneration 124 102
Share based payment charge - 36
Legal Fees 4 38
Nomad Fees 50 83
Fees payable to the Company's auditor for the
audit of the Group and Company's financial statements 22 27
4. E M PLOY E ES A N D DIRECTORS
The average number of persons employed by the Company in the
financial year (including directors that receive remuneration) was
5 (2021: 5).
The highest paid director during the year received GBP62,000
(2021: 57,000).
T h e follo wing tables s et out and analy se the rem un eration
of directors for the y ears e nd ed 31 December 2022 and 2021.
For the year ended 31 December 2022:
Contribution Share
Total to Pension Based
Salary Fees emoluments schemes Payments Total remuneration
------------------ -------- -------- ------------ ------------- ----------- -------------------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Dennis Edmonds 30 - 30 - - 30
Peter Taylor 60 - 60 2 - 62
Mark Gasson - 25 25 - - 25
Jonathan Summers 7 - 7 - - 7
97 25 122 2 - 124
------------------ -------- -------- ------------ ------------- ----------- -------------------
For the year ended 31 December 2021:
Contribution Share
to Pension Based
Salary Fees Total emoluments schemes Payments Total remuneration
------------------ -------- -------- ----------------- ------------- ----------- -------------------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
John Taylor 6 - 6 - - 6
Dennis Edmonds 30 - 30 - - 30
Peter Taylor 51 - 51 1 5 57
Mark Gasson - 15 15 - 8 23
Jonathan Summers - - - - 11 11
87 15 102 1 24 127
------------------ -------- -------- ----------------- ------------- ----------- -------------------
No share options were exercised by the directors, and no shares
were received or receivable by any director in respect of
qualifying services under a long-term incentive scheme.
5. INCO M E T AX
The charge for the year is made up as follows:
2022 2021
GBP'000 GBP'000
Current tax - -
------------------------ -------- --------
Tax charge for the year - -
------------------------ -------- --------
A n al ysis of tax expense
N o liability to UK corporation tax arose for the y ear e nd ed
31 December 2022 nor for the y ear e nd ed 31 December 2021. No
deferred tax asset has been recorded on tax losses carried
forward.
Factors affecting the tax expense
T h e tax ass es sed for the y ear is higher than the standard
rate of corporation tax in t he UK. T he dif f ere n ce is explain
ed b elow:
2022 2021
GBP'000 GBP'000
Loss on ordinary activities before tax (376) (367)
Loss on ordinary activities multiplied
by the standard rate of corporation tax
in the UK of 19% (2021: 19%) (71) (70)
Effects of:
Non-deductible expenses - -
Income not chargeable to tax - -
Unrelieved tax losses carried forward 71 70
Tax expense - -
--------------------------------------------- -------- --------
6. LOSS OF PARE N T CO M PA N Y
As permitted by Section 408 of the Companies Act 2006, the
income statement of the parent company is not presented as part of
these financial statements. The parent company's loss for the
financial year was GBP376k (2021: GBP367k).
7. LOSS P E R SHA R E
Basic lo ss p er s hare is calculat e d, as set out in the
tables b elow, by dividing the loss attributable to ordinary s hare
hold e rs by the weight ed a verage nu m b er of ordinary s hares
outstanding during the p eriod.
In accordance with IAS 33, as the Group is reporting a loss for
both this and the preceding year the share options and warrants are
not considered dilutive because the exercise of these would have
the effect of reducing the loss per share.
As at 31 December 2022:
Loss Weighted average Per-share
GBP'000 number of shares amount, pence
--------- ------------------ ---------------
Basic loss attributable to
the ordinary shareholders 376 532,094,193 0.07p
As at 31 December 2021:
Loss Weighted average Per-share
GBP'000 number of shares amount, pence
--------- ------------------ ---------------
Basic loss attributable to
the ordinary shareholders 367 494,687,905 0.07p
8. INVESTMENTS
Parent company Shares in group
undertakings
GBP'000
COST
At 31 December 2021 and 31 December
2022 34,806
PROVISION FOR IMPAIRMENT
At 31 December 2021 and 31 December
2022 (34,806)
NET BOOK VALUE
At 31 December 2021 and 31 December -
2022
S ub si d iar ies
Pathfinder Battery Commodities Ltd
Regi ster ed o ffic e: 35 Berkeley Square, London, W1J 5BF, U nit ed Kin g dom
N ature of bu sin e s s: Holding com pany
Class of sha r es: Ordinary
Holding: 100.00%
I M M i nerals Li m ited
Regi ster ed o ffic e: 35 Berkeley Square, London, W1J 5BF, U nit ed Kin g dom
N ature of bu sin e s s: Holding com pany
Class of sha r es: Ordinary
Holding: 100.00%
Companh ia M i nei ra de Nab uri SARL
Regi ster ed o ffic e: Moza m bique
N ature of bu sin e s s: Mining
Nature of business: Non-trading
Class of sha r es: Ordinary
Ordinary 99.9%
S oc i edade Geral de M i nerac ao de Moçam b i que SARL
Regi ster ed o ffic e: Moza m bique
N ature of bu sin e s s: Non-trading
Class of sha r es: Ordinary
Ordinary 99.8%
IM Min erals Li mited h eld the s hares in Co m panhia Min eira
de Naburi SARL ("CMdN ") w hich h eld titanium dioxide mining conce
s sions in the R e public of Moza m biqu e. In Novem b er 2011, the
original v e ndors of IM Min erals' s ub sidiary, CMdN, ad vis ed
the Com pany that th ey had procured the cancellation of IM Min
erals Ltd's s har es in CMdN and the tran sfer of its ass ets (the
mining lice nce s) to another company controlled by th em. Whil st
the Co m pany is ta king l egal and oth er action in ord er to r
eco ver the s hares and the lic e nce s, the Com pany, in the
interest of accounting prud e nce, made f ull pro vision in the
2011 financial statem e nts again st the co st of its inv es t m e
nt in IM Min erals Ltd. As a consequence of the situation regarding
the Company's legal claims, the Company has been unable to verify
the current registered office addresses for the
Mozambique-domiciled companies, CMdN and Sociedade Geral de
Mineracao de Moçambique SARL. Furthermore, whilst the Company
believes these companies to be non-trading, the Company has been
unable to verify their trading statuses.
9. TRADE AND OTHER RECEIVABLES
Group Parent Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Other debtors 8 8 8 8
VAT 5 4 5 4
Prepayments and accrued income - 7 - 7
-------- -------- -------- --------
13 19 13 19
-------- -------- -------- --------
10. CA S H AND C ASH EQUIVALE N TS
Group Parent Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Bank accounts 46 365 46 365
-------- -------- -------- --------
11. SHA R E CA PITAL
a) Called up, allotted, issued and fully paid share capital
No. Ordinary Deferred Allotment Share Share Premium
shares shares price Capital GBP'000
of 0.1p of 9.9p (GBPs) GBP'000
each each
Total as at 31 December
2021 531,328,168 183,688,116 18,716 14,234
------------------------- ------------- ------------ ---------- --------- --------------
6 May 2022 1,166,666 - 0.005 1 5
Total as at 31 December
2022 532,494,834 183,688,116 18,717 14,239
------------------------- ------------- ------------ ---------- --------- --------------
b) Share options & warrants in issue
Share options
Exercise Grant Date Expiry Date At 1 January Issued At 31 December
Price 2022 / (lapsed) 2022
2.50p 10 April 2019 9 April 2022 7,500,000 (7,500,000) -
1.25p(1) 11 May 2020 11 May 2022 19,000,000 (9,000,000) 10,000,000
1.25p(1) 4 August 2020 31 May 2023 6,000,000 - 6,000,000
21 September 20 September
1.75p 2018 2023 18,750,000 - 18,750,000
0.55p 17 March 2021 16 March 2023 6,000,000 - 6,000,000
1.25p 1 April 2021 31 March 2023 6,000,000 - 6,000,000
1.25p 9 June 2021 8 June 2023 6,000,000 - 6,000,000
1.25p 23 June 2021 22 June 2023 3,000,000 - 3,000,000
1.25p 4 October 2021 3 October 2023 5,000,000 - 5,000,000
77,250,000 (16,500,000) 60,750,000
--------- --------------- --------------- ------------- ------------- ---------------
(1) On 6 May 2022, the following amendments were made to certain of the above share options:
-- 10,000,000 of the 19,000,000 1.25p options that were
otherwise due to expire on 11 May 2022 were extended so as to lapse
on 11 May 2023
-- 6,000,000 options with an exercise price of 1.25p and an
expiry date of 11 May 2022, were extended so as to expire on 31 May
2023.
Share warrants
Exercise Expiry Date At 1 January Issued/(lapsed) At 31 December
Price 2022 2022
0.50p(1) 11 May 2022 1,166,666 (1,166,666) -
3.50p 17 June 2022 10,703,018 (10,703,018) -
1.50p 11 May 2022 38,769,230 (38,769,230) -
2 November
1.25p 2022 2,500,000 (2,500,000) -
0.50p(2)
(3) 31 May 2023 11,666,668 - 11,666,668
1.50p(3) 31 May 2023 3,076,923 - 3,076,923
0.60p 29 April 2024 3,500,000 - 3,500,000
--------- -------------- ------------- ---------------- ---------------
71,382,505 (53,138,914) 18,243,591
--------- -------------- ------------- ---------------- ---------------
(1) On 6 May 2022, 1,166,666 warrants over Ordinary shares were
exercised at a price of 0.5p per share.
(2) On 19 February 2021, in accordance with the terms of the 11
May 2020 warrant instrument, the warrants subsisting thereunder
were repriced from 0.60p to 0.50p each.
(3) On 6 May 2022, 11,666,668 warrants with an exercise price of
0.50p and 3,076,923 warrants with an exercise price of 1.50p, all
with an expiry date of 11 May 2022, were extended so as to expire
on 31 May 2023.
12. TRADE AND OTHER PAYABLES
Group Parent Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Trade creditors 4 - 4 -
Social security and other
taxes 43 86 43 86
Other creditors 42 42 42 42
Accruals and deferred
income 25 21 25 21
-------- -------- -------- --------
114 149 113 149
-------- -------- -------- --------
13. BORROWINGS
On 29 September 2022 and 28 December 2022, the Company announced
it has entered into a loan agreement whereby an FCA authorised
financial institution has arranged for the provision to the Company
by an individual, of an unsecured loan facility of up to GBP120,000
(the "Loan") for working capital purposes. The Loan carried a
simple fixed interest of 5.0 percent on any amounts drawn down and
had issue costs of GBP5,000. The Loan was designed to provide the
Company with access to additional working capital, should it be
required. As at 31 December 2022 GBP80,000 had been drawn down.
The Loan was repaid in full together with accrued interest and
the issue costs on 1 February 2023.
14. CONTINGENT LIABILITIES
As part of the agreement for the purchase of the shares in its
subsidiary, Companhia Mineira de Naburi SARL (CMdN), the Company's
subsidiary, IM Minerals Limited, agreed to pay the vendors a
further sum of US$9,900,000 if, following further exploration and
appraisal, an agreement is reached for the construction of a
facility for the processing of ore extracted from the Naburi
mineral sands deposit. This sum has since been reduced by advances
of GBP90,083, made by IM Minerals Limited, and GBP75,933, made by
the Company, to one of the vendors, Mr Diogo Cavaco.
Similarly, as part of its agr e e me nt for the purchase of the
w hole of the i ss u ed s hare capital of Soci e dade Geral de Min
eracao de Moçambiq ue SARL, CMdN has agreed to pay the ve ndors,
BHP Billiton, a f urth er s um of US$9,500,000 if, following f urth
er exploration and appraisal, an agree me nt is reach ed for the
con struction of a facility for the processing of ore extracted
from the Mo e base min eral sands d e posit. T his obligation is
guaranteed by IM Min erals L i mited.
In July 2021, the Company engaged Travers Smith LLP to act for
the Company in connection with its ongoing work to secure the
return of Mining Licence 4623C (the "Licence"), or compensation in
relation thereto. The fees payable to Travers Smith LLP are payable
on a contingent basis subject to a minimum pre-claim amount; in
February 2022, the cap was increased from GBP100,000 to GBP200,000;
in November 2022, the cap was further increased to GBP250,000.
Following the year-end, the Company and Travers Smith LLP agreed a
pre-claim fee of approximately GBP226k, including disbursements, in
respect of the ongoing work to secure the return of Mining Licence
4623C or compensation in relation thereto.
15. REL A T E D PARTY DISCLOSUR E S
Details of directo r s' re m un eration are given in note 4
above.
16. SHARE BASED PAYMENTS
The fair values of the share options and warrants at the date of
grant have been measured using the Black- Scholes pricing model,
which takes into account factors such as the option life, share
price volatility and the risk-free rate.
Each share option and warrant vested and was exercisable
immediately upon grant. The share-based expense relating to each
share option and share warrant was recognised in full on the date
of grant.
Share options
Risk Expected Fair
Share Exercise Free life Expected Expected value
Date of grant price price Rate(1) of options yield volatility(2) per option
21 September
2018 1.45p 1.75p 0.70% 5 years 0% 55% GBP0.00609
10 April 2019 1.35p 2.50p 0.71% 3 years 0% 55% GBP0.00264
11 May 2020 0.93p 1.25p(3) 0.07% 2 years 0% 55% GBP0.00190
4 August 2020 0.43p 1.25p(3) 0.06% 2 years 0% 55% GBP0.00022
17 March 2021 0.53p 0.55p 0.05% 2 years 0% 55% GBP0.00151
1 April 2021 0.53p 1.25p 0.05% 2 years 0% 55% GBP0.00040
9 June 2021 0.79p 1.25p(3) 0.05% 2 years 0% 55% GBP0.00127
23 June 2021 0.75p 1.25p(3) 0.05% 2 years 0% 55% GBP0.00111
4 October
2021 0.73p 1.25p(3) 0.05% 2 years 0% 55% GBP0.00101
(1) Daily sterling overnight index average (SONIA) rate at the
date of grant was adopted as the effective risk - free rate.
(2) Expected volatility is based on management's estimate of the
expected volatility
(3) Repriced to 0.75p following the year-end, on 27 April
2023.
Share warrants
Risk Expected Fair
Share Exercise Free life Expected Expected value
Date of grant price price Rate of warrants yield volatility per option
4 June 2019 2.75p 3.50p 0.71% 3 years 0% 55% GBP0.00827
11 May 2020(1) 0.93p 0.60p 0.07% 2 years 0% 55% GBP0.00426
11 May 2020 0.93p 1.50p 0.07% 2 years 0% 55% GBP0.00144
2 November
2020 0.68p 1.25p 0.05% 2 years 0% 55% GBP0.00083
21 May 2021 0.68p 0.6p 0.05% 2.9 years 0% 55% GBP0.00271
(1) On 19 February 2021, in accordance with the terms of the
relevant warrant instrument, the warrants subsisting thereunder
were repriced from 0.60p to 0.50p each.
On 6 May 2022, the Company extended the expiry date of certain
directors' share options and share warrants issued to a related
party. The details are as follows:
Director Date of No. Options Exercise Original Expiry New Expiry
Grant Price Date Date
--------------- ----------- ------------ ---------- ---------------- -----------
Dennis Edmonds 11/05/2020 10,000,000 GBP0.0125 11/05/2022 11/05/2023
Peter Taylor 04/08/2020 6,000,000 GBP0.0125 30/08/2022 30/08/2023
--------------- ----------- ------------ ---------- ---------------- -----------
Warrant Holder Date of No. Warrants Exercise Original Expiry New Expiry
Grant Price Date Date
----------------- ----------- ------------- --------- ---------------- -----------
Richard Jennings 11/05/2020 11,666,668 GBP0.005 11/05/2022 11/05/2023
Richard Jennings 11/05/2020 3,076,923 GBP0.015 11/05/2022 11/05/2023
----------------- ----------- ------------- --------- ---------------- -----------
The extension of share options and warrants did not result in a
change to the fair value that was determined on initial
recognition.
In addition, following the year-end, the exercise price and
expiry date of the aforementioned options was changed. See note
19.
The directors' interests in the share options and warrants of
the Company as at 31 December 2022 are as follows:
Director Number Number Exercise Latest exercise
of options of warrants price per date
share
D. Edmonds 10,000,000 - 1.25p 11 May 2023
P. Taylor 6,000,000 - 1.25p 30 August 2023
P. Taylor 5,000,000 - 1.25p 3 October 2023
M Gasson 6,000,000 - 1.25p 8 June 2023
The total share-based payment expense in the year for the
Company was GBPnil in relation to options (2021: GBP27k) and GBPnil
in relation to warrants (2021: GBP8.5k).
17. NON-CASH TRANSACTIONS
2022 2021
GBP'000 GBP'000
Settlement of broker commissions - 11
---------------------------------- ---------- ---------
- 11
--------------------------------------------- ---------
18. FINANCIAL INSTRUMENTS
The Company's principal financial instruments comprise cash and
cash equivalents and other receivables/payables. The Company's
accounting policies and method adopted, including the criteria for
recognition, the basis on which income and expenses are recognised
in respect of each class of financial assets, financial liability
and equity instrument are set out in note 1. The Company does not
use financial instruments for speculative purposes.
The principal financial instruments used by the Company, from
which financial instrument risk arises, are as follows:
Group Parent Company
2022 2021 2022 2021
Financial assets at amortised GBP'000 GBP'000 GBP'000 GBP'000
cost
Cash and cash equivalents 46 365 46 365
Prepayments and accrued income - 7 - 7
Financial liabilities at
amortised cost
Trade payables and accruals 114 149 114 149
a) Financial risk management objectives and policies
The Company's major financial instruments include bank balances
and amounts payable to suppliers. The risks associated with these
financial instruments and the policies on how to mitigate these
risks are set out below. The Directors manage and monitor these
exposures to ensure appropriate measures are implemented on a
timely and effective manner.
b) Liquidity risk
Liquidity risk arises from the Company's management of working
capital.
The Company regularly reviews its major funding positions to
ensure that it has adequate financial resources in meeting its
financial obligations. The Directors have considered the liquidity
risk as part of their going concern assessment (see note 1).
Controls over expenditure are carefully managed in order to
maintain its cash reserves whilst it targets a suitable
transaction. Financial liabilities are all due within one year.
c) Credit risk
The Company's credit risk is wholly attributable to its cash
balance. The credit risk from its cash and cash equivalents is
limited because the counterparties are banks with high credit
ratings and have not experienced any losses in such accounts.
d) Interest risk
The Company's exposure to interest rate risk is the interest
received on the cash held, which is immaterial.
e) Capital risk management
The Company's objectives when managing capital are to safeguard
the Company's ability to continue as a going concern, in order to
provide returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure. The
Company has no borrowings. In order to maintain or adjust the
capital structure, the Company may adjust the amount of dividends
paid to shareholders, return capital to shareholders, or issue new
shares.
f) Fair value of financial assets and liabilities
There are no material differences between the fair value of the
Company's financial assets and liabilities and their carrying
values in the financial information.
19. E V E N TS A F T ER T H E RE PORT I N G P E RI O D
On 1 February 2023, the Company announced the issue and
allotment of 100,000,000 new ordinary shares of 0.1 pence per share
to raise GBP0.5m before expenses.
On 28 April 2023, the expiry date and exercise price of share
options which were granted to certain Directors and an employee
were amended as set out below. The revised exercise price
represents a premium of approximately 50 percent to the closing
share price on 27 April 2023.
Original Original Revised Revised
Exercise Date of Expiry Exercise Expiry
Name Position No. Options Price Grant Date Price Date
--------------- --------- ------------ ---------- ----------- ----------- ---------- -----------
Dennis Edmonds Director 10,000,000 GBP0.0125 11/05/2020 11/05/2023 GBP0.0075 30/06/2025
Peter Taylor Director 6,000,000 GBP0.0125 04/08/2020 30/08/2023 GBP0.0075 30/06/2025
5,000,000 GBP0.0125 04/10/2021 03/10/2023 GBP0.0075 30/06/2025
Mark Gasson Director 6,000,000 GBP0.0125 09/06/2021 08/06/2023 GBP0.0075 30/06/2025
Employee Employee 3,000,000 GBP0.0125 23/06/2021 22/06/2023 GBP0.0075 30/06/2025
--------------- --------- ------------ ---------- ----------- ----------- ---------- -----------
On 11 May 2023, shareholders voted to approve the disposal of
the Company's wholly-owned subsidiary, IM Minerals Limited as
explained further, in the Chairman's Statement on page 2 .
20. ULTIMATE CONTROLLING PARTY
The directors believe there is no ultimate controlling
party.
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END
FR NKQBPABKDNPB
(END) Dow Jones Newswires
May 25, 2023 02:00 ET (06:00 GMT)
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