TIDMKZG
RNS Number : 9072W
Kazera Global PLC
15 December 2023
15 December 2023
Kazera Global plc ('Kazera' or 'the Company')
Final Results and publication of Annual Report and Notice of
AGM
Kazera Global plc, the AIM-quoted investment company, is pleased
to announce its Final Results for the year ended 30 June 2023 and
the publication of its Annual Report which will be made available
on the Company's website.
Highlights
Whale Head Minerals - Heavy Mineral Sands (HMS)
-- August 2022: Receipt of mining permit for heavy mineral sands project at Walviskop
-- December 2022: Commenced initial production of HMS
-- June 2023: Pilot plant showed very promising HMS results with samples and test results:
o forming the basis for informed strategic discussions with
potential offtake partners
o indicating presence of higher value minerals including rutile,
zircon, and monazite
o identified to have raised levels of radioactivity and the
Company submitted the necessary application to the National Nuclear
Regulator for the appropriate permit.
Deep Blue Minerals - Diamonds
-- July 2022: Diamond mine pan plant installed and commissioned
-- March 2023: New plant completed and new mining blocks granted
to give access to a further 28,000 carats of diamonds
-- June 2023: New heavy equipment on site providing greater flexibility on mining locations
African Tantalum - Tantalum and Lithium
-- December 2022: Sale of African Tantalum (Aftan) to Hebei
Xinjian Construction ("Xinjian") agreed for cash consideration of
US$13m
-- June 2023: Aggregate proceeds received of US$4.2 million
Corporate
-- March 2023: Strategic shareholder African Mineral Sands Pte
Ltd ("AMS") agrees to acquire up to 29.9% of the Company's Ordinary
Shares from an existing shareholder at 1.5p per share
-- Geoff Eyre, Gerard Kisbey-Green and Peter Wilson appointed to the Board
-- Cash at 30 June 2023 of GBP761k
Post Period:
-- July 2023: R eceived further payment of c. US$650,000 from
Xinjian in respect of the sale of Aftan. Aggregate payments
received total c.US$4.85 million.
-- October 2023: HMS: Manufacture of Trommel screening plant
completed. Plant expected to start operating immediately on
receival of National Nuclear Regulator permit anticipated Q1
2024.
-- November 2023: Diamonds: Pulsating diamond jig with 20 tons
per hour processing capacity ordered. Expected to start operating
in early 2024
-- December 2023: AMS completed purchase of 250,000,000 shares
from existing shareholder at 1.5 pence per Ordinary Share, becoming
Kazera's largest shareholder
Publication of Annual Report and Notice of AGM
The Company has today published a notice convening an annual
general meeting ("AGM") of the Company to be held at 16:30 on 17
January 2024, at 33 St James' Square, London, SW1Y 4JS.
The Company is also pleased to confirm that Kazera's annual
report for the year ended 30 June 2023 ("Annual Report") and the
notice of AGM will be posted to shareholders on 18 December
2023.
The Annual Report and notice of AGM will be made available on
the Company's website www.kazeraglobal.com.
CHAIRMAN'S STATEMENT
For the year ended 30 June 2023
Review of the Period
Such is the activity and progress at Kazera over the last year
that it can be easy to forget that I only joined the Group as
Non-Executive Chairman in July 2022.
In my first annual report, I commented that it was an exciting
prospect to join the Company with its assets on the verge of
becoming cash flow positive. Whilst that objective is still a short
distance away, I am proud of the progress and changes that Kazera
has made during the year, having laid a strong foundation for
future success.
It is sometimes overlooked that our two main investments, Whale
Head Minerals Pty Ltd ("WHM"), in which we hold 60% of the share
capital, and Deep Blue Minerals Pty Ltd ("Deep Blue" or "DBM"), in
which we have a 64% beneficial interest (see Note 14 ), are in
their infancy. In fact, in 2020, Deep Blue had a sub-contracting
agreement to mine diamonds at Alexander Bay but absolutely no
equipment, and it was only in July 2022 that a mining permit was
granted at WHM's Walviskop site.
Progress at Deep Blue has been frustrating as we have tried to
navigate the challenges posed by the unique operating environment
in which we operate. I believe that we are close to having the
correct structures and equipment to finally realise the potential
of this company.
WHM has seen significant progress during the year, however while
work was completed on the processing plant design and the major
components of the Wet Processing Plant were ordered, progress on
actual production was delayed by the need to apply for
authorisation from the National Nuclear Regulator after slightly
elevated levels of radioactivity within the gravels were detected.
It is not uncommon for heavy mineral sands to contain radioactive
elements; we have submitted the necessary application and
anticipate that authorisation will be granted during the first
quarter of the 2024 calendar year. In the meantime, we have put
this time to good use, further optimising the metallurgy and
process design to maximise recoveries once production begins.
Whilst there are still a few hurdles to overcome, the hard work,
persistence, and investment means the Group is in a much better
place than it was a year ago. My confidence in Kazera is
multifaceted but fundamentally, the projects have sizeable
resources, and the mining, processing and sale of the commodities
is neither complex nor costly, and they can quickly become
profitable once we have in place the right equipment,
infrastructure and partners.
On the investment front, the transaction to sell our African
Tantalum project in Namibia has thus far allowed the Group to
progress the WHM and Deep Blue projects towards production and
profitability without raising additional funds or taking on any
debt.
The Board chose to terminate the proposed acquisition of a 71%
interest in Great Lakes Graphite (Pty) Ltd in March 2023. Although
it would have diversified the Company's portfolio, the Board
decided that it was more prudent to focus its energy and the
Company's resources on WHM and Deep Blue where the route to
production and profitability were well defined. The Board and its
advisors continue to seek and evaluate new investments whilst
managing capital and cash resources prudently. Both the termination
of the Great Lakes Graphite deal as well as the sale of Aftan
demonstrates that the Board is flexible in terms of the investment
criteria and focused on adding value to shareholders.
We have also been adding to the experience, knowledge and
capacity of the team. At board level, we were pleased to welcome
Peter Wilson, with 42 years of experience in the international
mining and mining contract industry, and Geoffrey Eyre, a finance
professional with more than 17 years' experience in senior
positions in the mining industry, as Non-Executive Directors.
I am pleased to welcome African Mineral Sands Pte Ltd ("AMS"),
which has acquired 26.69% of the Company's Ordinary shares from an
existing shareholder. AMS has extensive experience in mining and
infrastructure projects in Southern Africa and its knowledge,
experience and connections are already providing opportunities for
the Company.
In closing, I want to reiterate the progress Kazera has made in
the past year. We have made significant strides in bringing both
WHM and Deep Blue closer to profitability. Our focus on acquiring
the right equipment, developing efficient processes, and forging
strategic partnerships has been relentless, funded by the sale of
Aftan. This strategic approach has allowed us to avoid raising
additional funds or taking on debt, a testament to our commitment
to responsible growth. Alongside this, the strengthening of our
team and shareholder base is enhancing our capabilities and opening
new opportunities.
I am confident that Kazera is poised for a prosperous future,
and I am excited about the journey that lies ahead for our Company.
I would like to thank the Board, the executive team and all of our
advisors for your trust and support during the year, and I look
forward to working with all of you as we continue our progress in
the current year.
Gerard Kisbey-Green
Chairman
14 December 2023
CHIEF EXECUTIVE OFFICER'S REVIEW
For the year ended 30 June 2023
Overview
I am pleased to provide an overview of activities during the
year in which, notwithstanding some developments are taking longer
than anticipated, Kazera Global Plc has made excellent progress
towards generating cashflow in the near future.
Operations
Whale Head Minerals - Heavy Mineral Sands
Kazera owns 60% of Whale Head Minerals ("WHM"), a heavy mineral
sands ("HMS") project in Walviskop, Alexander Bay, South Africa. In
2020, independent consultancy company Creo Design (Pty) Limited
("CREO"), which undertook the initial competent persons report and
resource estimate, calculated WHM had a net present value at GBP150
million based on expected production of circa 6,000 tons of HMS per
month and applying a 20% discount rate. It is estimated that the
resource, once fully operational, which we expect to achieve during
the course of 2024, may generate gross profits of circa US$300,000
per month.
It is easy to forget that it was only in August 2022 that a
Mining Permit was granted to WHM enabling the construction of an
HMS processing facility at the site to commence. The permit gave
WHM the right to mine a 5 hectare beach sand deposit at Walviskop
with a JORC Indicated Mineral Resource of 3.11 million tons of
Valuable Heavy Minerals at a grade of 61.2%. This was made up of
Garnet (30.29% Run of Mine ("ROM")) and Ilmenite (27.54% ROM), with
Zircon and Rutile also present but not included in any of the
Company's modelling.
In December 2022, WHM commenced initial limited basic production
of HMS to help inform the design of a more comprehensive processing
facility and, in February 2023, the Company placed an order for the
manufacture of equipment including a specially designed centrifugal
screen.
Whilst awaiting the build and delivery of the screen, the
Company introduced a double-deck 500-micron screen with a view to
accelerating production of the separated HMS product and commence
building up stockpiles of HMS whilst identifying a site to dry
material away from the moisture at the coast. Work also commenced
on building a spiral array, reconditioning pumps, building
additional scalpers, screens, feed bins and conveyers.
Subsequently, in March 2023, the permit area was moved circa 100
metres to the west due to conflicts identified with the original
permit coordinates. This resulted in the updated mine permit being
in the surf zone of the bay and not largely on the beach. CREO
estimated the resource volume for the updated permit location to be
comparable in volume to the initial volume estimate under the
original permit but at a grade of 49.9% total heavy minerals
compared to the 61.2%. This difference was explained by the wind
playing a significant role in removing light sand grains from the
beach within the original permit area, and so enriching the heavy
mineral deposited there.
However, the Company recognised that a major benefit of the
revised permits was that the volumes in situ are largely
irrelevant, as was the 5-year Life of Mine under the original
permit area, given that wave action constantly replenishes HMS in
the updated permit area, whilst also rehabilitating the mine
site.
The proposed mining method used at the updated WHM permit area
will remain a dredging operation as originally planned. With the
entire resource being submerged, mining at the revised permit area
is not dependent on, or hindered by, the tidal state and with
dredge pumps able to deliver high volumes of raw material than an
excavator, it will be possible to achieve higher production levels,
at lower unit cost per ton mined. Consequently, the revised permit
area has the potential to outperform the HMS production volumes of
the original permit area.
Extensive testing revealed very promising results and allowed
the Company to determine the make-up of its HMS and further guide
refinements in the design of its full processing plant.
Samples and test results also formed the basis for informed
strategic discussions with industry experts and off-take partners
on the short and long term potential of the Company's HMS. From
these discussions, initial findings suggest that the Company's HMS
has a heavy mineral content of approximately 62%, with around 55%
of the resources classified as "saleable heavy minerals".
Indicative pricing for the basic (unseparated) product was $160 per
ton, but the Company was able to confirm that by undertaking
further separation, it could be expected to achieve a price of
approximately double, whilst transport costs would remain the
same.
Deep Blue Minerals - Diamonds
Kazera has a 64% beneficial interest (see Note 14 ) in Deep
Blue, which is a diamond project in Alexander Bay, South Africa.
The operation is located within the 80km long Alexkor diamond
fields, which lies between two historic De Beers operations. The
area has been mined for diamonds since 1928 and more than ten
million carats of gem quality diamonds have been recovered over the
last ninety years or so. It is estimated that there are at least
another two million carats left in the tenement.
In 2020, a Feasibility Study was prepared on one of the mining
blocks allocated to Deep Blue, which resulted in an ascribed
inferred resource of 208,000 carats at a bottom cut-off aperture
size of 1.6 mm at a grade of 6.0 ct/100m2. DBM's current focus is
on deposits closer to the beach where diamonds tend to be of better
quality and the amount of overburden is considerably less.
Mining at Deep Blue is undertaken under contract from Alexkor
RMC JV ("Alexkor"), a government owned entity, which has the rights
to all the diamonds in the area. In 2020, Deep Blue had a
sub-contract to mine diamonds, but none of its own equipment. Since
then, the Company has acquired its own mining contract as well as
the equipment required to mine and process diamond gravel. This
includes a diamond mining plant and new heavy plant, including a
front-end Loader and a 75 ton Low-bed transporter, to allow the
sharing of equipment between Deep Blue's diamond project, and WHM's
HMS project. At Deep Blue, this is specifically used to target
areas containing prospective high quantities of diamond gravel,
which the Group believes creates a very cost-effective approach by
prioritising potentially rich diamond deposits first.
Part of the agreement with Alexkor requires that it processes
the diamond gravels and undertakes all diamond sales, but with
Alexkor's Muisvlak processing plant operating sporadically during
the year, the ability to process diamond gravel and, accordingly,
produce diamonds for sale has been greatly constrained.
In June 2022, Deep Blue agreed to take on the task of getting
the Muisvlak plant running as, without it, neither Deep Blue or the
majority of the other contractors in the area had any way of
processing their diamonds. Deep Blue was successful in doing this
but was forced to withdraw its assistance due to political and
economic factors, and operating difficulties at Muisvlak
endure.
The resulting blockage in the diamond mining process for Deep
Blue and all other diamond miners in the area because of a forced
reliance on Alexkor to process our diamonds and take them to market
is hugely frustrating for all. Accordingly, Deep Blue has now
commissioned the building of a diamond specific pulsating jig,
together with a Flow Sorter, which will enable it to bypass the
Muisvlak plant completely and allow it to deliver very small
volumes of very high concentrate diamond gravels to Alexkor for
final sorting. Deep Blue anticipate that this equipment will be in
operation early in 2024 and will allow a quick ramp up in
production and positive cash flow.
African Tantalum - Lithium
In July 2022, the Company announced an agreement to secure a
non-dilutive US$7.5 million investment in return for a 49% stake in
the Company's marketing, sales, and export subsidiary for all
lithium production from the Tantalite Valley mine in Namibia.
Subsequently, this was improved upon when, in December 2022, it was
agreed that Hebei Xinjian Construction ("Xinjian") would acquire
the Company's entire interest in African Tantalum (Pty) Ltd
("Aftan") in Namibia to for cash consideration of US$13,000,000 ,
meaning the Company would not have to incur any of the costs
related to mining, transport or building a processing plant .
To date, we have received aggregate payments totalling c.US$4.4
million in respect of the sale, which have enabled Kazera to invest
in, and advance, its other investment projects, without the need of
accessing external funding.
Nonetheless, it has been frustrating for the Board and
Shareholders alike that the full cash consideration of the sale is
yet to be paid, albeit the transaction still represents a milestone
for the Company as it is the first realisation of a return from an
investment, which is in line with our stated strategy.
As things currently stand, Xinjian is not in compliance with the
sale agreement (as announced on 20 December 2022) and also owes
accrued interest of approximately US$260k at 30 June 2023. However,
our decision not to exercise our contractual rights to terminate
the contract at this time is due to the strong position it is in,
given that:
-- Kazera retains 100% ownership of Aftan as security until all
amounts owed by Xinjian have been paid in full;
-- All ongoing operational costs in respect of the Aftan
business are being borne by Xinjian and have been since the
beginning of 2023;
-- Communication between Kazera and Xinjian remains positive and
constructive, and there is hope that further payments will be
forthcoming; and
-- Outstanding and overdue balances are accruing interest at a rate of 8% per annum.
This is a situation we wish to resolve and are actively
exploring alternative avenues for the future of Aftan should
Xinjian fail to swiftly fulfil its contractual obligations. Options
open to the Company include terminating the contract with Xinjian
and resuming full control of Aftan, finding an alternative buyer
for the project, or selling Xinjian's debt to a third party.
Whatever the outcome for the Aftan project, it is important to
remember that the Company still owns the underlying asset and will
retain all payments received from Xinjian to date. We will,
naturally, update shareholders of any development in due
course.
Corporate Matters
During the year we made important additions to the Board of
Directors in Geoffrey Eyre and Peter Wilson, whilst Giles Clarke,
Nick Harrison and Odilon Kasongo Ilunga stepped down.
In December 2022, the Company settled all outstanding debts to
former Directors and loan providers, and is now debt-free.
In March 2023, we welcomed a new strategic shareholder to the
register, African Mineral Sands Pte Ltd ("AMS"), which has
experience in mining and infrastructure projects in Southern
Africa. It has since acquired an aggregate of 26.69% of the
Company's existing Ordinary shares from an existing shareholder and
this relationship is already proving of great value. AMS has
introduced a number of potential new deals to the Company and the
Board is actively engaged in due diligence and negotiations
regarding structuring.
Post year end
Whale Head Minerals - Heavy Mineral Sands
Further test results from the pilot plant in July 2023 indicate
the presence of minerals including rutile, zircon, and monazite in
much higher quantities than anticipated. These minerals usually
have a much higher commercial value than ilmenite, but are
typically associated with raised levels of radioactivity. This has
required the Company to engage with the National Nuclear Regulator
("NRR") to obtain the appropriate certification to allow it to
process and transport radioactive materials.
To guide this discussion, a comprehensive baseline study of
radioactivity was conducted across all areas of Walviskop,
including areas where the Company's HMS will be stored, processed,
and transported. In addition, a third party compiled a Workers
Safety Report and Operating Procedures. Subsequently, the Company
commenced the application process with the NRR for relevant
permits, which it anticipates will be granted in Q1 2024.
In the meantime, further HMS sampling has been undertaken to
enable the Company to design the necessary processes to maximise
the commercial separation of the component materials. The Company
has commissioned a Trommel screening plant, which was completed on
schedule at the end of September 2023 and has now been transported
to site for installation. The construction of the remainder of the
wet concentration plant on site has also commenced, along with the
creation of administration, security, storage, and loading
facilities within a secure area supplied to the Company by Alexkor
RMC JV. In addition, Alexkor RMC JV, which recognises the value of
the project in terms of opportunities for the local community, has
provided the Company with administration buildings, entrance /exit
facilities and a sheltered and secure workshop facility for the
repair, maintenance and storage of the Company's plant and
machinery.
The Company expects the full HMS plant at Walviskop to be in
operation before it receives the NRR permits in Q1 2024 and, once
fully operational, this strategically important project is expected
to produce circa 6,000t of HMS per month. Given anticipated strong
demand for its products, the Company expects to achieve a gross
profit of circa US$300,000 per month based on current prices.
Having invested in the appropriate plant and machinery and
undertaken a great deal of hard work on the ground, we believe full
production at WHM is now just a few months away.
Outlook
Taking the final few steps to positive cashflow and
profitability are the Company's immediate focus and, whilst we have
experienced some delays, we have used the time constructively
utilising funding from the ongoing sale of the Aftan Project to put
in place the plant, people and equipment needed to make this a
reality in short order.
As we move into positive cashflow, we will continue to deliver
growth and value for our shareholders through reinvestment into our
WHM and Deep Blue projects to fulfil our organic growth potential,
whilst carefully evaluating the potential of M&A opportunities
that frequently cross our desk. As demonstrated when we walked away
from Buru Hills rare earth project at nil cost, our priority is to
ensure that any M&A activity is right for the Company at that
point in time and does not risk jeopardising fulfilling the
potential of our existing projects, which have real potential to
make Kazera a very successful business. It is not our intention to
sit on piles of cash, so if a project has not already been
identified the Board would always consider returning excess cash to
shareholders.
Dennis Edmonds
Chief Executive Officer
14 December 2023
GROUP STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2023
Notes Year ended Year ended
30 June 2023 30 June 2022
GBP'000 GBP'000
------------------------------------------------------------------------------ ------ -------------- --------------
Revenue 5 31 107
Cost of Sales (155) (107)
------------------------------------------------------------------------------ ------ -------------- --------------
Gross loss (124) -
Pre-production expenses - (333)
Administrative expenses (1,518) (474)
------------------------------------------------------------------------------ ------ -------------- --------------
Operating loss 6 (1,642) (807)
Finance charges 7 - (44)
Net finance income 7 246 -
Loss before taxation from continuing operations (1,396) (851)
Taxation expense 10 (142) -
------------------------------------------------------------------------------ ------ -------------- --------------
Loss for the year from continuing operations (1,538) (851)
Profit/(loss) on discontinued operation, net of tax 15 8,128 (1,170)
------------------------------------------------------------------------------ ------ -------------- --------------
Profit/(loss) attributable to owners of the Company 6,706 (2,001)
Loss attributable to non-controlling interests (116) (20)
------------------------------------------------------------------------------ ------ -------------- --------------
Profit/(loss) for the year 6,590 (2,021)
Other comprehensive income:
Items that may be subsequently reclassified to profit and loss:
Exchange differences on translation of foreign operations 159 (17)
------------------------------------------------------------------------------ ------ -------------- --------------
6,749 (2,038)
Total comprehensive profit/(loss) for the year attributable to:
The equity holders of the parent 6,865 (2,018)
The non-controlling interests (116) (20)
------------------------------------------------------------------------------ ------ -------------- --------------
Total comprehensive profit/(loss) for the year 6,749 (2,038)
Basic and diluted Earnings per share in pence attributable to owners of the
Company from:
Total operations 11 0.70 p (0.26) p
Discontinued operations 11 0.87 p (0.15) p
The accounting policies and notes form an integral part of these
financial statements.
GROUP AND COMPANY STATEMENTS OF FINANCIAL POSITION
As at 30 June 2023
GROUP COMPANY
------------------
2022
2023 (as restated) 2023 2022
Notes GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------------- ----- -------- -------------- -------- --------
Non-Current assets
Mines under construction 12 749 2,961 - -
Property, plant and equipment 13 531 796 - -
Investment in subsidiaries 14 - - 784 3,298
Long-term loan 16 - - 1,607 8,737
1,280 3,757 2,391 12,035
----------------------------------------------- ----- -------- -------------- -------- --------
Current assets
Trade and other receivables 17 9,053 279 8,866 22
Cash and cash equivalents 18 761 637 758 609
9,814 916 9,624 631
--------
Current liabilities
Trade and other payables 19 191 652 73 645
191 652 73 645
----------------------------------------------- ----- -------- -------------- -------- --------
Non-Current liabilities
Other payables 19 - 69 - -
Provisions - 54 - -
----------------------------------------------- ----- -------- -------------- -------- --------
- 123 - -
----------------------------------------------- ----- -------- -------------- -------- --------
Net current assets / (liabilities) 9,623 264 9,551 (14)
Net assets 10,903 3,898 11,942 12,021
----------------------------------------------- ----- -------- -------------- -------- --------
Equity
Share capital 21 3,516 3,516 3,516 3,516
Share premium account 21 17,556 17,556 17,556 17,556
Capital redemption reserve 2,077 2,077 2,077 2,077
Share option reserve 574 443 574 443
Currency translation reserve 422 263 - -
Retained earnings (13,077) (19,908) (11,781) (11,571)
----------------------------------------------- ----- -------- -------------- -------- --------
Equity attributable to owners of the Company 11,068 3,947 11,942 12,021
Non-controlling interests (165) (49) - -
----------------------------------------------- ----- -------- -------------- -------- --------
Total equity 10,903 3,898 11,942 12,021
----------------------------------------------- ----- -------- -------------- -------- --------
The accounting policies and notes form an integral part of these
financial statements.
The Company has elected to take the exemption under section 408
of the Companies Act 2006 not to present the parent Company pro t
and loss account. The loss for the Parent Company for the year was
GBP335,670 (2022: GBP328,095 loss).
These financial statements were approved by the Board of
Directors on 14 December 2023.
Signed on behalf of the Board by
Dennis Edmonds
Director
Company number: 05697574
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2023
Shar e Capital Currency
pr r Share translation Equity
Shar e emium edemption option reserve Retained shareholders' Non-controlling
capital account r eserve reserve (restated) earnings funds interests Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
================= ======= ======= ========= ======= =========== ======== ============= ================ =======
Balance at
30 June 2021 3,279 15,863 2,077 337 (477) (17,917) 3,162 (29) 3,133
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Loss for the
year - - - - - (2,001) (2,001) (20) (2,021)
Other
comprehensive
income - - - - 740 - 740 - 740
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Total
comprehensive
income - - - - 263 (2,001) (1,261) (20) (1,281)
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Transactions
with owners
in their capacity
as owners:
Issue of share
capital 237 1,693 - - - - 1,930 - 1,930
Share
options/warrants
exercised - - - (10) - 10 - - -
Share based
payment expense - - - 116 - - 116 - 116
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Balance at 30
June 2022 3,516 17,556 2,077 443 (494) (19,908) 3,947 (49) 3,141
Prior year
adjustment
see note 27 - - - - 757 - - - 757
Balance at
30 June 2022
(as restated) 3,516 17,556 2,077 443 263 (19,908) 3,947 (49) 3,898
================= ======= ======= ========= ======= =========== ======== ============= ================ =======
Profit for the
year - - - - - 6,706 6,706 (116) 6,590
Other
comprehensive
income - - - - 159 - 159 - 159
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Total
comprehensive
income - - - - 159 6,706 6,865 (116) 6,749
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
Transactions
with owners
in their capacity
as owners:
Share
options/warrants
exercised - - - (125) - 125 - - -
Share based
payment expense - - - 256 - - 256 - 256
Balance at
30 June 2023 3,516 17,556 2,077 574 422 (13,077) 11,068 (165) 10,903
----------------- ------- ------- --------- ------- ----------- -------- ------------- ---------------- -------
The accounting policies and notes form an integral part of these
financial statements.
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2023
Capital Share
Share Share redemption option Retained
capital premium reserve reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ --------- --------- ------------ --------- ---------- ----------------------
Balance at 30
June 2021 3,279 15,863 2,077 337 (11,253) 10,303
------------------------ --------- --------- ------------ --------- ---------- ----------------------
Total comprehensive
income for the
year - - - - (328) (328)
Issue of share
capital, net of
share issue costs 237 1,693 - - - 1,930
Share options/warrants
exercised - - - (10) 10 -
Share based payment
expense - - - 116 - 116
Balance at 30
June 2022 3,516 17,556 2,077 443 (11,571) 12,021
------------------------ --------- --------- ------------ --------- ---------- ----------------------
Total comprehensive
income for the
year - - - - (335) (335)
Share options/warrants
exercised - - - (125) 125 -
Share based payment
expense - - - 256 - 256
Balance at 30
June 2023 3,516 17,556 2,077 574 (11,781) 11,942
------------------------ --------- --------- ------------ --------- ---------- ----------------------
The accounting policies and notes form an integral part of these
financial statements.
Group and Company Statements of Cash Flows
For the year ended 30 June 2023
GROUP COMPANY
------------------------ ------------------------
Year ended Year ended Year ended Year ended
30 June 30 June 30 June 30 June
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------------------------- ----------- ----------- ----------- -----------
OPERATING ACTIVITIES
Loss before tax from continuing operations (1,396) (851) (335) (328)
Profit/loss before tax from discontinued operations 8,128 (1,170) - -
--------------------------------------------------------- ----------- ----------- ----------- -----------
Loss before tax 6,732 (2,021) (335) (328)
Depreciation and amortisation 40 52 -
Share based payment expense 256 116 256 116
Net finance (income)/charges (246) 44 (246) 44
Foreign exchange 269 121 75 -
Gain on sale of subsidiary (8,037) - (476) -
Intercompany loan written off - - 1,308 -
Management fees - - (1,144) -
Intercompany loan interest charged - - (106) (336)
--------------------------------------------------------- ----------- ----------- ----------- -----------
Operating cash flows before movement in working capital (986) (1,688) (668) (504)
(Increase)/decrease in receivables (531) (110) (343) 1
(Decrease)/increase in payables (59) 880 (66) 205
--------------------------------------------------------- ----------- ----------- ----------- -----------
Net cash used in operating activities (1,576) (918) (1,077) (298)
--------------------------------------------------------- ----------- ----------- ----------- -----------
INVESTING ACTIVITIES
Purchases of property, plant and equipment (69) (438) - -
Development costs (24) (6) - -
Trial diamond mining - 107 - -
Proceeds from disposal of subsidiary 2,316 - 2,316 -
Advances to subsidiary undertakings - - (569) (757)
Purchase/increase in subsidiary undertakings - - - (184)
Net cash used in investing activities 2,223 (337) 1,747 (941)
--------------------------------------------------------- ----------- ----------- ----------- -----------
FINANCING ACTIVITIES
Net proceeds from share issues - 1,498 - 1,498
Loans (repaid)/received (474) 347 (474) 347
Interest paid (47) - (47) -
--------------------------------------------------------- ----------- ----------- ----------- -----------
Net cash from financing activities (521) 1,845 (521) 1,845
--------------------------------------------------------- ----------- ----------- ----------- -----------
Net increase in cash and cash equivalents 126 590 149 606
Cash and cash equivalents at beginning of year 637 47 609 3
Exchange losses on cash and cash equivalents (2) - - -
--------------------------------------------------------- ----------- ----------- ----------- -----------
Cash and cash equivalents at end of year 761 637 758 609
--------------------------------------------------------- ----------- ----------- ----------- -----------
During the year purchases of property, plant and equipment
included GBP180k of non-cash additions.
The accounting policies and notes are an integral part of these
financial statements.
NOTES TO THE GROUP FINANCIAL STATEMENTS
For the year ended 30 June 2023
1. General Information
Kazera Global Plc is a public limited company which is listed on
the Alternative Investment Market (AIM) and incorporated and
domiciled in England and Wales, United Kingdom. The nature of the
Group's operations and its principal activities are set out in the
Strategic Report and the Directors' Report.
2. Accounting Policies
BASIS OF PREPARATION
These consolidated financial statements have been prepared and
approved by the Directors in accordance with UK Adopted
International Accounting Standards in accordance with the
requirements of the Companies Act 2006.
The consolidated financial statements have been prepared under
the historical cost convention, except as noted in the accompanying
accounting policies.
The preparation of financial statements in conformity with UK
Adopted International Accounting Standards ('IAS') requires the use
of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the
accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and estimates
are significant to the financial statements, are disclosed in Note
3.
The financial statements are presented in pounds sterling
(GBP'000), which is also the functional currency of the Company and
Group.
The principal accounting policies applied in the preparation of
these financial statements are set out below. These policies have
been consistently applied to all the years presented, unless
otherwise stated.
PRIOR YEAR ADJUSTMENT
Subsequent to the approval of the 2022 financial statements the
Board carried out a review of the prior year 'other payables'
balance of GBP826k shown in non-current liabilities. The Board
concluded that GBP757k of this balance related to amounts due from
Deep Blue Minerals (Pty) Ltd to the Company. As DBM is a subsidiary
of the Company this amount should have been eliminated against the
corresponding receivable amount in the Company, in the consolidated
statement of financial position. However, the elimination had
instead been allocated to Currency translation reserve. The effect
of the adjustment to correct the error increases the Group's net
assets by GBP757k to GBP3.9m from the previously stated GBP3.1m.
See note 27 .
Additionally, a reconciliation of the issued share capital of
the Company was carried out and a historical error was identified
which had resulted in the 2022 financial statements having
overstated the number of Ordinary shares of 0.1p in issue by
565,388. See note 21 .
GOING CONCERN
The financial statements have been prepared assuming the Group
and Company will continue as a going concern.
The Company prepares and routinely maintains a cash flow
forecast; the directors have, with reference to the cash flow
forecast considered a number of potential scenarios under which the
Company's ability to continue as a going concern is assessed.
In assessing whether the going concern assumption is
appropriate, the directors have taken into account all available
information for the forseeable future; in particular for the 12
months from the date of approval of these financial statements and
performed sensitivity analysis thereon. This assessment includes
consideration of the cash receipts arising from the disposal of the
Group's operations in Namibia, and in South Africa, the Group's
future plans, expenditure commitments, and cost reduction measures
that can be implemented and permitting requirements.
The Directors' estimates are dependent principally upon the
Group's mining operations coming into operation as planned and
funds from the sale of African Tantalum Pty Ltd continuing to be
received in the short-term. The Directors are confident that
further funds could be raised to meet any shortfall in the event
that insufficient funds are received timeously, or operations are
delayed or underperform.
in view of the facts that the Group's mining operations are not
yet in full operation and the proceeds arising from the sale of the
Company's former subsidiary, African Tantalum Pty Ltd have not yet
been reveived in full, the Directors consider than a material
uncertainty exists as to the Company's ability to continue as a
going concern; the auditors have made reference to this material
uncertainty in their audit report on page 28 of the Annual Report
and Financial Statements.
Following the Company's announcement of 20 December 2022, that
Kazera had entered into an agreement for the sale of 100% of its
shares in African Tantalum Pty Ltd to Hebei Xinjian Construction
for a headline sum of US$13 million (excluding interest at 8% on
loans of c.US$9.3 million made by Kazera to Aftan), the Company has
received payments amounting to US$4.42m.
NEW STANDARDS, AMMENTS AND INTERPRETATIONS ADOPTED BY THE
GROUP
The following IFRS or IFRIC interpretations were effective for
the first time for the financial year beginning 1 July 2022. Their
adoption has not had any material impact on the disclosures or on
the amounts reported in these financial statements.
Standards/interpretations Application Effective from
IAS 1 amendments Presentation of Financial Statements: Classification of Liabilities as 1 January 2024
Current or Non-current
IAS 1 amendments Classification of Liabilities as Current or Non-current 1 January 2024
IAS 1 amendments Presentation of Financial Statements and IFRS Practice Statement 2: 1 January 2023
Disclosure of Accounting
Policies
IAS 8 amendments Accounting policies, Changes in Accounting Estimates and Errors - 1 January 2023
Definition of Accounting
Estimates
IAS 12 amendments Income Taxes - Deferred Tax related to Assets and Liabilities arising 1 January 2023
from a Single Transaction
BASIS OF CONSOLIDATION
Subsidiaries are all entities (including structured entities)
over which the Group has control. The Group controls an entity when
the Group is exposed to, or has rights to, variable returns from
its involvement with the entity and has the ability to affect those
returns through its power over the entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control
ceases.
Inter-company transactions, balances and unrealised gains on
transactions between group companies are eliminated. Unrealised
losses are also eliminated.
The Group applies the acquisition method to account for business
combinations. The consideration transferred for the acquisition of
a subsidiary is the fair values of the assets transferred, the
liabilities incurred to the former owners of the subsidiary and the
equity interests issued by the Group. The consideration transferred
includes the fair value of any asset or liability resulting from a
contingent consideration arrangement. Identifiable assets acquired
and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the
acquisition date. The Group recognises any non-controlling interest
in the subsidiary on an acquisition-by-acquisition basis, either at
fair value or at the non-controlling interest's proportionate share
of the recognised amounts of subsidiary's identifiable net
assets.
Acquisition-related costs are expensed as incurred.
Any contingent consideration to be transferred by the Group is
recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is
deemed to be an asset or liability is recognised either in profit
or loss or as a change to other comprehensive income. Contingent
consideration that is classified as equity is not re-measured, and
its subsequent settlement is accounted for within equity.
Disposal of subsidiary undertakings
A disposal of a subsidiary occurs when control is lost, which
can happen through the sale, liquidation, or other forms of
relinquishment of control. Upon disposal, the subsidiary will be
deconsolidated from the date control is lost. All assets,
liabilities, and non-controlling interests related to the
subsidiary will be removed from the consolidated balance sheet. The
consideration received from the disposal of a subsidiary will be
measured at fair value on the disposal date; the gain or loss on
disposal will be calculated as the difference between:
-- The fair value of the consideration received; and
-- The carrying amount of the subsidiary's assets and
liabilities, and any cumulative translation differences recorded in
equity.
The results of the subsidiary up to the date of disposal will be
included in the consolidated income statement and shown separately
as discontinued operations.
foreign currencies
The individual financial statements of each subsidiary company
are presented in South African Rands (and Namibian Dollars for the
subsidiary disposed of during the year), which is the currency of
the primary economic environment in which it operates (its
functional currency). For the purpose of the Group and parent
company financial statements, the results and financial position of
each group company are expressed in Pounds Sterling, which is the
functional currency of the Company, and the presentation currency
for the Group financial statements.
In preparing the financial statement of the individual
companies, transactions in currencies other than the entity's
functional currency (foreign currencies) are recorded at the rates
of exchange prevailing on the dates of the transactions. At each
year end date, monetary assets and liabilities that are denominated
in foreign currencies are retranslated at the rates prevailing on
the year end date. Non-monetary items carried at fair value that
are denominated in foreign currencies are translated at the rates
prevailing at the date when the fair value was determined.
Non-monetary items that are measured in terms of historical cost in
a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary
items, and on the retranslation of monetary items, are included in
the income statement. Exchange differences arising on the
retranslation of non-monetary items carried at fair value are
included in profit or loss for the period, except for differences
arising on the retranslation of non-monetary items in respect of
which gains and losses are recognised directly in equity. For such
non-monetary items, any exchange component of that gain or loss is
also recognised directly in equity.
For the purpose of presenting Group financial statements, the
assets and liabilities of the Group's foreign operations are
translated at exchange rates prevailing on the year end date.
Income and expense items are translated at the average exchange
rates for the period. Exchange differences arising are classified
as equity and transferred to the Group's translation reserve. Such
translation differences are recognised as income or as expenses in
the period in which the operation is disposed of.
TAXATION
The tax currently payable is based on taxable profit or loss for
the period. Taxable profit or loss differs from net profit or loss
as reported in the income statement because it excludes items of
income or expense that are taxable or deductible in other years and
it further excludes items that are never taxable or deductible. The
Company's liability for current tax is calculated using tax rates
that have been enacted or substantively enacted by the balance
sheet date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which
deductible temporary differences can be utilised. Such assets and
liabilities are not recognised if the temporary difference arises
from goodwill or from the initial recognition (other than in a
business combination) of other assets and liabilities in a
transaction that affects neither the tax profit nor the accounting
profit.
The carrying value of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the deferred tax asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled, or the asset is
realised based on tax laws and rates that have been enacted at the
balance sheet date. Deferred tax is charged or credited in the
income statement, except when it relates to items charged or
credited directly to equity, in which case the deferred tax is also
dealt with in equity.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
INTANGIBLE ASSETS - EXPLORATION AND EVALUATION EXPITURE
Exploration and evaluation activity involve the search for
mineral resources, the determination of technical feasibility and
the assessment of commercial viability of an identified resource.
Research expenditure is written off in the year in which it is
incurred. The Group recognises expenditure as exploration and
evaluation assets when it determines that the legal rights to said
assets have been obtained. Costs incurred which relate wholly to
exploration work only, are expensed through the statement of
comprehensive income. When a decision is taken that a mining
property becomes viable for commercial production, all further
pre-production expenditure is capitalised.
Expenditure included in the initial measurement of exploration
and evaluation assets and which is classified as intangible assets,
relates to the acquisition of rights to undertake topographical,
geological, geochemical and geophysical studies, exploratory
drilling, trenching, sampling and other activities to evaluate the
technical feasibility and commercial viability of extracting a
mineral source.
MINES UNDER CONSTRUCTION
Expenditure is transferred from "Exploration and evaluation"
assets to "Mines under construction" once the work completed to
date supports the future development of the property and such
development receives the requisite approvals. All subsequent
expenditure on technically and commercially feasible sites is
capitalised within mining rights.
All expenditure on the construction, installation or completion
of infrastructure facilities is capitalised as construction in
progress within "Mines under construction". Once production starts,
all assets included in "Mines under construction" are transferred
into "Property, Plant and Equipment" or "Producing Mines. It is at
this point that depreciation/amortisation commences over its useful
economic life. The asset will be depreciated using the Units of
Production method (UOP).
Mines under construction are stated at cost. The initial cost
comprises transferred exploration and evaluation assets,
construction costs, infrastructure facilities, any costs directly
attributable to bringing the asset into operation, the initial
estimate of the rehabilitation obligation, and, for qualifying
assets, borrowing costs. Costs are capitalised and categorised
between mining rights and construction in progress respectively
according to whether they are intangible or tangible in nature.
PROPERTY, PLANT AND EQUIPMENT
Property, Plant and equipment are recorded at cost, less
depreciation, less any amount of adjustments for impairment, if
any.
Significant improvements are capitalised, provided they qualify
for recognition as assets. The costs of maintenance, repairs and
minor improvements are expensed when incurred.
Tangible assets, retired or withdrawn from service, are removed
from the balance sheet together with the related accumulated
depreciation. Any profit or loss resulting from such an operation
is included in the income statement.
Tangible and intangible assets are depreciated on the
straight-line method based on their estimated useful lives from the
time they are put into operation, so that their net cost is
diminished over the lifetime of consideration to estimated residual
value as follows:
Buildings Over 20 years
Plant and machinery Between 5 and 10
years
Furniture and equipment Between 5 and 10
years
IMPAIRMENT OF PROPERTY, PLANT & EQUIPMENT AND INTANGIBLE
ASSETS EXCLUDING GOODWILL
Assets that have an indefinite useful life are not subject to
amortisation but are reviewed for impairment annually and where
there are indications that the carrying value may not be
recoverable. An impairment loss is recognised for the amount by
which the carrying value exceeds the recoverable amount.
ASSET ACQUISITIONS - land
Acquisitions of mineral exploration licences through the
acquisition of non-operational corporate structures that do not
represent a business, and therefore do not meet the definition of a
business combination, are accounted for as the acquisition of an
asset. The consideration for the asset is allocated to the assets
based on their relative fair values at the date of acquisition.
Inter-company transactions, balances and unrealised gains on
transactions between group companies are eliminated. Unrealised
losses are also eliminated.
Where the asset was acquired during the period however licensing
becomes available post year end this is accounted for as an
acquisition of Land.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash at bank and in hand,
deposits at call with banks, other short-term highly liquid
investments with original maturity at acquisition of three months
or less that are readily convertible to cash, net of bank
overdrafts. For the purpose of the cash flow statement, cash and
cash equivalents consist of the definition outlined above.
EQUITY INSTRUMENTS INCLUDING SHARE CAPITAL
Equity instruments consist of the Company's ordinary share
capital and are recorded at the proceeds received, net of direct
issue costs.
FINANCIAL INSTRUMENTS - INITIAL RECOGNITION AND SUBSEQUENT
MEASUREMENT
Classification
The Group classifies its financial assets into only one
category, being those to be measured at amortised cost.
The classification depends on the Group's business model for
managing the financial assets and the contractual terms of the cash
flows.
Recognition
Purchases and sales of financial assets are recognised on trade
date (that is, the date on which the Group commits to purchase or
sell the asset). Financial assets are derecognised when the rights
to receive cash flows from the financial assets have expired or
have been transferred and the Group has transferred substantially
all the risks and rewards of ownership.
Measurement
At initial recognition, the Group measures a financial asset at
its fair value plus transaction costs that are directly
attributable to the acquisition of the financial asset.
Debt instruments
Amortised cost: Assets that are held for collection of
contractual cash flows, where those cash flows represent solely
payments of principal and interest, are measured at amortised cost.
Interest income from these financial assets is included in finance
income using the effective interest rate method. Any gain or loss
arising on derecognition is recognised directly in profit or loss
and presented in other gains/(losses) together with foreign
exchange gains and losses. Impairment losses are presented as a
separate line item in the statement of profit or loss.
Impairment
The Group assesses, on a forward-looking basis, the expected
credit losses associated with its debt instruments carried at
amortised cost. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach
permitted by IFRS 9, which requires expected lifetime losses to be
recognised from initial recognition of the receivables.
FINANCIAL LIABILITIES
All non-derivative financial liabilities are classified as other
financial liabilities and are initially measured at fair value, net
of transaction costs. Other financial liabilities are subsequently
measured at amortised cost using the effective interest rate
method. Other financial liabilities consist of borrowings and trade
and other payables.
Financial liabilities are classified as current liabilities
unless the Company has an unconditional right to defer settlement
of the liability for at least 12 months after the balance sheet
date.
OTHER FINANCIAL LIABILITIES, BANK AND SHORT-TERM BORROWINGS
Other financial liabilities, as categorised above, are initially
measured at fair value, net of transaction costs. Other financial
liabilities are subsequently measured at amortised cost using the
effective interest method, with interest expense recognised on an
effective yield basis. Other financial liabilities are classified
as current liabilities unless the Company has an unconditional
right to defer settlement of the liability for at least 12 months
after the balance sheet date.
TRIAL PRODUCTION REVENUE AND COSTS
Revenue
IFRS 15 establishes a comprehensive framework for determining
whether, how much and when revenue is recognised. These steps are
as follows: identification of the customer contract; identification
of the contract performance obligations; determination of the
transaction price; allocation of the transaction price to the
performance obligations; and revenue recognition as performance
obligations are satisfied.
Under IFRS 15, revenue is recognised when performance
obligations are met. This is the point of delivery of goods to the
customer. Revenue is measured at the fair value of consideration
received or receivable from sales of diamonds and tantalite to an
end user, net of buyer's discount, treatment charges, freight costs
and value added tax. The application of the standard including the
five-step approach has not resulted in any changes to the timing of
recognition of revenue in the current or any prior period.
Cost of revenue
These are the costs directly associated with the extraction and
processing of diamonds from mining operations.
Costs to be included in cost of sales are as follows:
-- Extraction costs: These include labour and overhead costs
directly related to the extraction of diamonds from the mine.
-- Processing Costs: Costs incurred in the crushing, sorting,
and other processing required to prepare the diamonds for sale.
-- Inventory Costs: Costs related to the storage and security of
diamonds until they are sold. This includes warehousing and
insurance costs.
-- Depreciation and Amortization: The systematic allocation of
the depreciable amount of assets (e.g., machinery, equipment) used
in the extraction and processing of diamonds.
Exclusion of costs: General administrative expenses, marketing,
and distribution costs are not included in the cost of sales but
are recognized as separate expense categories in the income
statement.
Cost of sales is recognized in the income statement when the
related revenue is recognized.
EARNINGS PER SHARE
Basic earnings per share (EPS) is calculated by dividing: the
profit attributable to owners of the Company, excluding any costs
of servicing equity other than ordinary shares; by the weighted
average number of ordinary shares outstanding during the financial
year, adjusted for bonus elements in ordinary shares issued during
the year and excluding treasury shares (note 11 ).
Diluted EPS adjusts the figures used in the determination of
basic EPS to take into account the after-income tax effect of
interest and other financing costs associated with dilutive
potential ordinary shares, and the weighted average number of
additional ordinary shares that would have been outstanding,
assuming the conversion of all dilutive potential ordinary
shares.
Discontinued operations
Basic EPS for discontinued operations is calculated by dividing
the net profit or loss attributable to ordinary shareholders from
discontinued operations by the weighted average number of ordinary
shares outstanding during the period.
Diluted EPS considers the potential dilution that would occur if
convertible instruments or contracts to issue shares were converted
into ordinary shares.
SEGMENTAL ANALYSIS
Under IFRS 8 operating segments are considered to be components
of an entity about which separate financial information is
available that is evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and assessing
performance. The Company's chief operating decision maker is the
Board of Directors. At present, and for the period under review,
the Company's reporting segments are the holding company, tantalite
and lithium mining operation in Namibia and the diamond mining
operations in South Africa.
3. Critical Accounting Judgements
In the application of the Group's accounting policies, which are
described in Note 2, the Directors are required to make judgements,
estimates and assumptions that affect the application of policies
and reported amounts of assets and liabilities, income and
expenses. The estimates and associated assumptions are based on
historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form
the basis of making the judgements about carrying values of assets
and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.
Valuation of options
The valuation of the options involves making a number of
critical estimates relating to price volatility, future dividend
yields, expected life of the options and forfeiture rates. These
assumptions and valuation methodology adopted have been described
in more detail in Note 22. The estimates and assumptions could
materially affect the Income Statement.
Carrying value of mines under construction (Note 12 )
The Group tests annually whether its mines under construction
have suffered any impairment and management make judgements in this
respect. The judgements are based on the recoverable amounts of
cash generating units ("CGUs") which are determined based on value
in use calculations which require the use estimates and assumptions
such as long-term commodity prices and recovery rates, discount
rates, operating costs and therefore expected margins and future
capital requirements. These estimates and assumptions are subject
to risk and uncertainty and therefore there is a possibility that
changes in circumstances will impact the recoverable amount.
During the year, progress on production at the Walviskop site
held by Whale Head Minerals, the parent company's 60% owned
subsidiary, was delayed by the need to apply for authorisation from
the National Nuclear Regulator after slightly elevated levels of
radioactivity within the gravels were detected. The necessary
application has been submitted and it is expected that
authorisation will be granted during Q1 2024. Should this
authorisation be denied or the process be further delayed, this
would impact the Company's cash flow projections and potentially
also the carrying values of the 'investment in subsidiary' and
'mines under construction'.
The Group continually monitors and updates its cash flow
forecast on both Group and legal entity bases, applying the latest
available information as regards operations and key inputs such as
commodity prices or sales forecasts, production rates, transport
costs. In reviewing the carrying value of mines under construction,
the Board has considered the present value of expected future cash
flows, discounted at a rate of 10%, and has ensured these exceed
the present carrying value.
Investment in subsidiaries
The investments in subsidiaries are recognised at cost less
accumulated impairments. Details of the investments are listed in
Note 14.
Upon acquisition, the excess of the sum of the consideration
transferred over the net of the acquisition-date amounts of the
identifiable assets acquired and the liabilities assumed, is
recognised under mines under construction.
Any potential impairments to the investments in subsidiaries are
measured in line with the impairment of mines under construction in
the paragraph above.
The Directors are confident that the future operational
cashflows forecast to be generated from the sale of diamonds and
HMS will be sufficient to repay the intragroup loans.
Loss of Control of African Tantalum Pty Ltd
In December 2022, the Company agreed to dispose of its interest
in 100% of the issued share capital of subsidiary African Tantalum
Pty Ltd ("Aftan") to Hebei Xinjian Construction CC ("Xinjian"). On
4 January 2023, Dennis Edmonds resigned as a director of Aftan and
each of its subsidiaries, following which Kazera has no control of
the board, operations or finances of Aftan and there is no
shareholder or relationship agreement in place through which Kazera
can exert control. Kazera is unable to compel the provision of such
detailed financial information from Aftan to enable it to
consolidate Aftan's financial information as it has no operational
control and no right to receive operational accounting information.
Furthermore, (without prejudice, and notwithstanding its ongoing
contractual breach) Xinjian has the power to compel the final
transfer of the issued share capital by making the final payment
and the remaining completion elements under the terms of the sale
and purchase agreement ("SPA") between the parties.
Whilst the ongoing fixed-rate royalty leads to a variable
absolute return, the Directors consider this to be consistent with
other forms of debt financing, and the SPA includes a negative
covenant restricting the payment of dividends by Aftan to
Kazera.
As a result of the loss of control of Aftan, that Company's
financial statements have been deconsolidated from the Group, as
further detailed in Note 15.
Recoverability of proceeds from disposal of Aftan
The directors acknowledge that:
-- There are uncertainties surrounding final amounts to be received from Xinjian
-- There are uncertainties surrounding timing of receipts
-- If the transaction is terminated due to non-payment of the
disposal proceeds the loan to Aftan may need to be reinstated; the
amounts received to date would be treated as repayment of this loan
and the deferred consideration would need to be written off
As at the date of this financial statements the directors
consider that the amounts due from Xinjian are recoverable,
however, if Xinjian remains in breach of contract and the parties
cease to progress the transaction in good faith, Kazera could
attempt to exercise its powers as a shareholder to eject Xinjian's
representatives from the board and retake operational control of
Aftan.
The Directors consider that the Company's potential economic
benefit from Aftan post-signing of the SPA is capped at the amount
of the outstanding intercompany loan and the remaining
consideration payable in respect of the equity sold.
Recoverability of intragroup loans
Significant judgment has been exercised by the directors in
assessing the recoverability of intragroup loans. The Company has
provided financial assistance to its subsidiaries in the form of
loans. These loans are assessed for recoverability annually.
The determination of recoverability involves estimating the
future cash flows expected to be received from the subsidiaries,
considering their financial position, profit projections, and
external market conditions. Based on these assessments, management
has concluded that the loans are recoverable and has recognised
them at their carrying amount in the financial statements.
Given the inherent uncertainties in predicting future events and
behaviours, this judgment is subject to estimation uncertainty. Any
changes in the financial condition of the subsidiaries, or in the
economic conditions under which they operate, could impact the
estimated recoverability of these loans, which may require
adjustments to their carrying values in future periods.
4. Segmental Reporting
The Directors are of the opinion that under IFRS 8 - Operating
Segments the Group operates in three primary business segments;
being holding company expenses, tantalite mining and diamond mining
activities. The secondary segment is geographic. The Group's
profit/(losses) and net assets by primary business segments are
shown below.
Segmentation by continuing business
Year ended Year ended
30 June 30 June
2023 2022
Profit/ (loss) before income tax GBP'000 GBP'000
------------------------------------------ ----------- -----------
Holding company (1,060) (620)
Diamond mining activity (453) (187)
Mineral sands mining activity (129) -
------------------------------------------ ----------- -----------
Operating loss (1,642) (807)
Net finance income/(charge) 246 (44)
Taxation expense (142) -
------------------------------------------ ----------- -----------
Loss from continuing activities (1,538) (851)
Profit/(loss) on discontinued operation,
net of tax 8,128 (1,170)
------------------------------------------ ----------- -----------
Group profit/(loss) for the year 6,590 (2,021)
------------------------------------------ ----------- -----------
Year ended Year ended
30 June 30 June
2023 2022
Net assets /(liabilities) GBP'000 GBP'000
------------------------------- ----------- -----------
Holding company 12,027 11,124
Diamond mining activity (1,009) (504)
Mineral sands mining activity (115) -
Tantalite mining activity - (6,722)
------------------------------- ----------- -----------
Group net assets 10,903 3,898
------------------------------- ----------- -----------
Segmentation by geographical area
Year ended Year ended
30 June 30 June
2023 2022
Operating loss GBP'000 GBP'000
---------------- ----------- -----------
United Kingdom (1,060) (620)
South Africa (582) (187)
---------------- ----------- -----------
(1,642) (807)
---------------- ----------- -----------
Year ended Year ended
30 June 30 June
2023 2022
Net assets /(liabilities) GBP'000 GBP'000
--------------------------- ----------- -----------
United Kingdom 12,027 11,124
Namibia - (6,722)
South Africa (1,124) (504)
--------------------------- ----------- -----------
10,903 3,898
--------------------------- ----------- -----------
5. Revenue
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
--------------------------------- ----------- -----------
Revenue from external customers 31 107
--------------------------------- ----------- -----------
Revenues of GBP31k (2022: GBP107k) were derived for the sale of
the by-products of testing and evaluation activities. Additionally,
there were GBP24k of revenues also from testing and evaluation
activities incurred in the disposal group (see note 15). For the
prior year the revenues derived from pre-production activities were
considered against the Mines Under Construction intangible asset
recognised in the Group. This amount was not deemed to be material
to the financial statements. (see note 12 ).
6. Operating Loss
Year ended Year ended
30 June 2023 30 June 2022
GBP'000 GBP'000
--------------------------------------- --------------- ---------------
Loss for the period has been arrived
at after charging:
Staff costs as per Note 9 below 790 520
Auditors' remuneration 61 50
Depreciation of property, plant and
equipment 40 52
Share-based payment expense 256 116
7. Finance Charges/INCOME
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
------------------------------------------- ------------ ------------
Loan interest payable (15) (44)
Interest income on deferred consideration 261 -
------------------------------------------- ------------ ------------
246 (44)
------------------------------------------- ------------ ------------
8. Auditors' Remuneration
Year ended
30 June Year ended
2023 30 June 2022
GBP'000 GBP'000
--------------------------------------- ---------------- --------------
Fees payable to the Group's auditors
for the audit of the Group's annual
accounts 61 50
Total audit fees 61 50
--------------------------------------- ---------------- --------------
9. Staff Costs
The average monthly number of employees (including executive
directors) for the continuing operations was :
Year ended Year ended
30 June 30 June
2023 2022
Number Number
-------------------------------------------- ----------- -----------
Group total staff 29 16
GBP'000 GBP'000
-------------------------------------------- ----------- -----------
Wages and salaries 507 400
Share based payment in respect of exercise
of options 256 118
Other benefits - 1
Social security costs 27 1
-------------------------------------------- ----------- -----------
790 520
-------------------------------------------- ----------- -----------
Directors' emoluments
An analysis of the directors' emoluments and pension
entitlements and their interest in the share capital of the Company
is contained in the Directors' Remuneration report on page 24 in
the Annual Report and Financial Statements. All emoluments are
short term in nature and the Directors are considered to be key
management personnel.
10. Taxation
The reasons for the difference between the actual tax charge for
the year and the standard rate of corporation tax applied to
profits for the year are as follows:
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
--------------------------------------------- ----------- -----------
Analysis of income tax expense:
Current tax - -
Deferred tax 142 -
--------------------------------------------- ----------- -----------
Total income tax expense 142 -
--------------------------------------------- ----------- -----------
Loss before tax from continuing operations (1,396) (851)
Profit/(loss) before tax from discontinued
operations 8,128 (1,170)
--------------------------------------------- ----------- -----------
Profit/(loss) before tax for the year 6,732 (2,021)
--------------------------------------------- ----------- -----------
Tax using the Company's domestic tax
rate of 20.50% (2022:19%) 1,380 (571)
Effects of:
Expenses not deductible for tax purposes 52 33
Unutilised tax losses carried forward 664 538
Substantial shareholder relief (1,832) -
Local deferred tax derecognised 142 -
Effect of difference between local and (264) -
UK tax rate
Tax charge for period 142 -
--------------------------------------------- ----------- -----------
The taxation charge in future periods will be affected by any
changes to the corporation tax rates in force in the countries in
which the Group operates. Losses from the previous period have been
carried forward. A deferred tax asset has not been recognised in
the financial statements due to the uncertainty of the
recoverability of the amount.
At the balance sheet date the Group had unused tax losses of
GBP5,288k (2022: GBP7,401k) .
11. Earnings Per Share
The calculation of basic earnings per share is based on the
following data:
Year ended Year ended
30 June 30 June
2023 2022
GBP'000 GBP'000
-------------------------------------------- ------------ ------------
Profit/(loss) for the year attributable
to owners of the Company
-------------------------------------------- ------------ ------------
Continuing operations (1,538) (851)
Discontinued operations 8,128 (1,170)
-------------------------------------------- ------------ ------------
Weighted average number of ordinary shares
in issue for basic and fully diluted
earnings 936,599,523 770,895,360
-------------------------------------------- ------------ ------------
EARNINGS PER SHARE (PENCE PER SHARE)
BASIC AND FULLY DILUTED:
- from continuing operations (0.17) (0.11)
- from discontinued operations 0.87 (0.15)
-------------------------------------------- ------------ ------------
0.70 (0.26)
-------------------------------------------- ------------ ------------
The Company has outstanding warrants and options as disclosed
under Note 22 which may be dilutive in future periods. As all
options and warrants had fully vested they had no-dilutive effect
on the basic earnings per share.
12. Mines under Construction
Construction Mining
in progress licences Total
GROUP GBP'000 GBP'000 GBP'000
--------------------------------- ------------- ---------- --------
At 1 July 2021 2,861 36 2,897
--------------------------------- ------------- ---------- --------
Additions - 6 6
Sale of by-products (107) - (107)
Exchange translation difference 161 4 165
================================= ============= ========== ========
At 30 June 2022 2,915 46 2,961
================================= ============= ========== ========
Additions 27 - 27
Exchange translation difference (92) - (92)
Disposal of subsidiary (2,147) - (2,147)
================================= ============= ========== ========
At 30 June 2023 703 46 749
================================= ============= ========== ========
13. Property, Plant and Equipment
Land & Plant &
buildings machinery Total
GROUP GBP'000 GBP'000 GBP'000
--------------------------------- ----------- ----------- --------
Cost
At 1 July 2021 125 1,224 1,349
Exchange translation difference - (350) (350)
Additions 184 254 438
Cost at 30 June 2022 309 1,128 1,437
--------------------------------- ----------- ----------- --------
Exchange translation difference - (169) (169)
Additions - 279 279
Disposal of subsidiary (125) (778) (903)
================================= =========== =========== ========
Cost at 30 June 2023 184 460 644
================================= =========== =========== ========
Depreciation
At 1 July 2021 35 598 633
Exchange translation difference - (44) (44)
Charge for the year 5 47 52
--------------------------------- ----------- ----------- --------
Depreciation at 30 June 2022 40 601 641
--------------------------------- ----------- ----------- --------
Exchange translation difference - (103) (103)
Charge for the year - 40 40
Disposal of subsidiary (40) (425) (465)
--------------------------------- ----------- ----------- --------
Depreciation at 30 June 2023 - 113 113
--------------------------------- ----------- ----------- --------
Net book value at 30 June
2023 184 347 531
--------------------------------- ----------- ----------- --------
Net book value at 30 June 2022 269 528 796
--------------------------------- ----------- ----------- --------
14. Investment in Subsidiary Undertakings
The Company's investments in its subsidiary and associated
undertakings
Total
COMPANY GBP'000
------------------------------------------------------------------------ ------------------
Cost and net book value
As at 1 July 2021 3,114
Acquisition: 60% of Whale Head Minerals (Pty) Ltd
(Note 15) 184
======================================================================== ==================
As at 30 June 2022 3,298
======================================================================== ==================
Disposal of African Tantalum (2,514)
------------------------------------------------------------------------ ------------------
As at 30 June 2023 784
------------------------------------------------------------------------ ------------------
All principal subsidiaries of the Group are consolidated
into the financial statements.
At 30 June 2023 the subsidiaries were as follows:
Country Holding %
Subsidiary undertakings of registration Principal activity
--------------------------- ------------------- --------------------- ----------- ------
Whale Head Minerals
(Pty) Ltd (1)
6 Reier Avenue
Alexander Bay
Northern Cape
8290 Mining License Ordinary
South Africa South Africa holder shares 60%
--------------------------- ------------------- --------------------- ----------- ------
Deep Blue Minerals
(Pty) Ltd (1)(2)
6 Reier Avenue
Alexander Bay
Northern Cape
8290 Mining License Ordinary
South Africa South Africa holder shares 90%
--------------------------- ------------------- --------------------- ----------- ------
Kazera Trading Limited
Unit D, De Clare House,
Sir Alfred Owen Way,
Pontygwindy Industrial
Estate
Caerphilly Ordinary
Wales, CF83 3HU UK Dormant shares 100%
--------------------------- ------------------- --------------------- ----------- ------
(1) Companies incorporated in South Africa are required to
comply with Broad-Based Black Economic Empowerment (B-BBEE)
regulations.
(2) 26% of the shares in Deep Blue Minerals (Pty) Ltd are
reserved for Black Economic Empowerment partners, and therefore
Kazera's ultimate beneficial interest in Deep Blue Minerals (Pty)
Ltd is 64%.
African Tantalum (Pty) Ltd and subsidiaries ("Aftan")
On 20 December 2022 the Company announced the 100% sale of Aftan
to Hebei Xinjian Construction for cash consideration of US$13m
(details provided in note 15).
15. Disposal of Subsidiary
On 20 December 2022, the Company announced the 100% sale of
Aftan to Hebei Xinjian Construction for cash consideration of
US$13m. Comprised of purchase consideration for the sale of the
shares in Aftan of USD3,642,207 and the repayment of the
intercompany loan to Kazera of USD9,357,793. Total consideration in
GBP is GBP10,673k.
On 4 January 2023, Dennis Edmonds resigned as a director of
Aftan and each of its subsidiaries, and from that date, the
accounts of Aftan ceased to be consolidated as a group company. See
note 3 for further information.
The post-tax gain on disposal of Aftan was determined as
follows:
Group GBP'000
Cash consideration 2,990
Repayment of existing loan 7,863
Total consideration 10,673
---------------------------------------------------- --------
Cash disposed of 615
---------------------------------------------------- --------
Net inflow on disposal of discontinued operations 10,059
Net assets disposed (other than cash)
Mines under construction (2,147)
Property, plant and equipment (438)
Trade and other receivables (92)
Trade and other payables 655
---------------------------------------------------- --------
Pre-tax gain on disposal of subsidiary undertaking 8,037
The post tax gain on disposal of discontinued operations was
determined as follows:
2023 2022
GBP'000 GBP'000
------------------------------------------ ------- -------
Revenue 24 -
Administration and other costs 67 (1,170)
Gain from selling discontinued operations
after tax 8,037 -
Profit/(loss) on discontinued operations
after tax 8,128 (1,170)
------------------------------------------ ------- -------
The statement of cash flows included GBP73k in relation to
outflow from operating activities relating to discontinued
operations.
16. Long Term Loan (Company)
Loan to Loan to
Loan to Deep Whale Head
Aftan Tantalum Blue Minerals Minerals Total
Company GBP'000 GBP'000 GBP'000 GBP'000
============================== ====================== ===================== ================== ===============
As at 1 July 2021 7,145 499 - 7,644
As at 30 June
2022 7,985 733 19 8,737
------------------------------ ---------------------- --------------------- ------------------ ---------------
Increase in loan 361 338 517 1,216
------------------------------ ---------------------- --------------------- ------------------ ---------------
Disposal of subsidiary (8,346) - - (8,346)
------------------------------ ---------------------- --------------------- ------------------ ---------------
As at 30 June
2023 - 1,071 536 1,607
------------------------------ ---------------------- --------------------- ------------------ ---------------
17. Trade and Other Receivables
GROUP COMPANY
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- ------- ------- ------- -------
Other receivables 8,520 262 8,500 5
Prepayments and accrued income 533 17 366 17
9,053 279 8,866 22
------------------------------- ------- ------- ------- -------
Included in other receivables is GBP8,501k (2022: nil) with
respect to amounts due on the sale of Aftan.
18. Cash and Cash Equivalents
GROUP COMPANY
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- ------- ------- ------- -------
Cash and cash equivalents 761 637 758 609
-------------------------- ------- ------- ------- -------
Cash and cash equivalents (which are presented as a single class
of asset on the face of the balance sheet) comprise cash at bank
and other short term, highly liquid investments with a maturity of
three months or less.
The Directors consider the carrying amount of cash and cash
equivalents approximates to their fair value.
19. Trade and Other Payables
GROUP COMPANY
2022
2023 (as restated) 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
------------------------ ------- -------------- ------- -------
Current Liabilities
Trade payables 17 12 11 12
Other payables 124 482 12 480
Accruals 50 158 50 153
------------------------ ------- -------------- ------- -------
191 652 73 645
------------------------ ------- -------------- ------- -------
Non-Current Liabilities
Other payables - 123 - -
- 123 - -
------------------------ ------- -------------- ------- -------
The Directors consider the carrying amount of trade payables
approximates to their fair value.
The 'other payables' non-current liability for the year ended 30
June 2022 has been re-stated as it had incorrectly included amounts
due from subsidiary, Deep Blue Minerals (Pty) Limited to the
Company. For further details see note 27 - prior year
adjustment.
20. Provisions
GROUP COMPANY
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- ------- ------- ------- -------
Mine rehabilitation provision - 44 - -
Mine decommissioning provision - 10 - -
------------------------------- ------- ------- ------- -------
- 54 - -
------------------------------- ------- ------- ------- -------
The provisions for mine rehabilitation and decommissioning in
2022 related to Aftan. Following the disposal of Aftan during the
year these provisions are no longer required. For further info on
the disposal of Aftan see note 15 .
Each of Deep Blue and WHM carry out continuous rehabilitation as
an embedded part of the mining process. Consequently, any
rehabilitation costs are incurred on an ongoing basis and no
provision is required.
21. Share Capital and Share Premium
No. Ordinary Share
shares Deferred shares Capital Share Premium
of 0.1p each of 0.9p each GBP'000 GBP'000
Total as at
30 June 2022
(restated) 936,599,523 286,561,208 3,516 17,556
Share issues - - - -
Total as at
30 June 2023 936,599,523 286,561,208 3,516 17,556
The number of Ordinary shares of 0.1p each in the capital of the
Company as at 30 June 2022 has been restated as the number of such
Ordinary shares had previously been overstated by 565,388 Ordinary
shares of 0.1p each.
Reserves
The Group's reserves are made up as follows:
Share capital: Represents the nominal value of the issued share
capital.
Share premium account: Represents amounts received in excess of
the nominal value on the issue of share capital less any costs
associated with the issue of shares.
Capital redemption reserve: Reserve created on the redemption of the Company's shares
Share option reserve: Reserve created for the equity settled
share option scheme (see note 22).
Currency translation reserve: Reserve arising from the
translation of foreign subsidiaries at consolidation. The total
movement in the foreign currency translation reserve was presented
in both the Statement of Changes in Equity and in Other
Comprehensive Income in the current year. During the prior year,
this movement was presented in the Statement of Changes in
Equity.
Retained earnings: Represents accumulated comprehensive income
for the year and prior periods.
22. Share-Based Payments
Equity-settled share option scheme and share warrants
The Company operates share-based payment arrangements to
incentivise directors by the grant of share options.
Equity-settled share-based payments within the scope of IFRS 2
are measured at fair value (excluding the effect of non-market
based vesting conditions) at the date of grant. The fair value
determined at the grant date of the equity-settled share-based
payments is expensed on a straight-line basis over the vesting
period, based on the Company's estimate of shares that will
eventually vest and adjusted for the effect of non-market based
vesting conditions.
The fair value of the share-based payments issued during the
year has been calculated using the Black-Scholes valuation model.
The assumptions used in the fair value calculation were as
follows:
8 July 18 July 3 November 16 May
Date of grant 2022 2022 2022 2023
------------------------------------- ----------------- ---------------- ----------------- -----------------
Number of options/warrants 3,000,000 4,000,000 16,500,000 4,000,000
Weighted average share GBP0.00725 GBP0.008 GBP0.00925 GBP0.00875
price
Exercise price (pence) GBP0.01 GBP0.01 GBP0.01 GBP0.01
Risk free interest (%) 1.91% 1.87% 3.345% 3,628%
Expected volatility
(%) 80% 80% 78% 76%
Expected life (years) 5 5 5 5
Fair value per option/warrant
(pence) 0.42p 0.48p 0.59p 0.54p
------------------------------------- ----------------- ---------------- ----------------- -----------------
The expected volatility is calculated by obtaining daily closing
prices over period of measure, computing the daily returns,
determining their standard deviation, and then annualizing this
figure by multiplying by the square root of the number of trading
days which is usually 252 days.
The total share-based payment expense recognised in the income
statement for the year ended 30 June 2023 in respect of the share
options granted was GBP256k (2022: GBP116k).
The total number of share options and share warrants in issue as
at 30 June 2023 are as follows:
Share Warrants
Exercise Expiry At 1 July At 30 June
Price Date 2022 Issued Exercised Lapsed 2023
GBP0.02 27/12/2022 10,000,000 - - (10,000,000) -
GBP0.02 04/01/2023 2,500,000 - - (2,500,000) -
GBP0.02 04/01/2023 5,000,000 - - (5,000,000) -
GBP0.01 30/10/2023 39,937,643 - - - 39,937,643
GBP0.02 01/02/2023 2,500,000 - - (2,500,000) -
GBP0.02 31/01/2023 10,000,000 - - (10,000,000) -
GBP0.01 31/05/2023 116,131,500 - - (116,131,500) -
GBP0.02 01/02/2023 3,500,000 - - (3,500,000) -
---------- ------------ ------------ ------- ---------- -------------- -----------
189,354,143 - - (149,631,500) 39,397,643
----------------------- ------------ ------- ---------- -------------- -----------
As at 30 June 2023 the weighted average contractual life of the
warrants in issue was 4 months (2022: 11.3 months).
Share options
Exercise Expiry At 1 At 30 June
Price (p) Date July 2022 Issued Exercised Lapsed 2023
GBP0.0175 20/12/2022 3,300,000 - - (3,300,000) -
GBP0.0175 20/12/2023 3,300,000 - - - 3,300,000
GBP0.0175 20/12/2024 3,400,000 - - - 3,400,000
GBP0.0100 03/06/2025 5,000,000 - - - 5,000,000
GBP0.0100 03/06/2025 5,000,000 - - - 5,000,000
GBP0.0100 03/06/2025 5,000,000 - - - 5,000,000
GBP0.0100 03/06/2025 10,000,000 - - - 10,000,000
GBP0.0100 08/07/2027 - 3,000,000 - - 3,000,000
GBP0.0100 18/07/2027 - 4,000,000 - - 4,000,000
GBP0.0100 06/05/2027 - 15,000,000 - - 15,000,000
GBP0.0200 12/01/2023 1,500,000 - - (1,500,000) -
GBP0.0100 06/05/2027 - 1,500,000 - - 1,500,000
GBP0.0100 11/05/2028 - 3,000,000 - - 3,000,000
GBP0.0100 11/05/2028 - 1,000,000 - - 1,000,000
------------ ------------ ----------- ----------- ---------- ------------ -----------
36,500,000 27,500,000 - (4,800,000) 59,200,000
------------------------- ----------- ----------- ---------- ------------ -----------
As at 30 June 2023 the weighted average contractual life of the
share options in issue was 2.8 years (2022: 2.4 years).
23. Financial Instruments
The Group's financial instruments comprise borrowings, cash and
various items, such as trade receivables and trade payables that
arise directly from its operations. The main purpose of these
financial instruments is to raise finance for the Group's
operations.
FINANCIAL ASSETS BY CATEGORY
Financial assets included in the Statement of financial position
and the headings in which they are included are as follows:
GROUP COMPANY
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------ ------- ------- ------- -------
Financial assets at amortised
cost:
Cash and cash equivalents 761 637 758 609
Loans and receivables 9,053 279 8,866 22
------------------------------ ------- ------- ------- -------
9,814 916 9,624 631
------------------------------ ------- ------- ------- -------
FINANCIAL LIABILITIES BY CATEGORY
Financial liabilities included in the Statement of financial
position and the headings in which they are included are as
follows:
GROUP COMPANY
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- ------- ------- ------- -------
Financial liabilities at amortised
cost:
Trade and other payables 191 652 73 645
----------------------------------- ------- ------- ------- -------
191 652 73 645
----------------------------------- ------- ------- ------- -------
The following table details the Group's remaining contractual
maturity for its non-derivative financial liabilities with agreed
repayment periods. The table has been drawn up based on the
undiscounted cash flows of financial liabilities based on the
earliest repayment date on which the Group can be required to pay.
The table includes both interest and principal cash flows. To the
extent that interest flows are floating rate, the undiscounted
amount is derived from the interest rate curves at the balance
sheet date. The contractual maturity is based on the earliest date
on which the Group may be required to pay.
Less 3 months
than to 1 1-5 Over
1 month 1-3 months year years 5 years
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- --------- ----------- --------- -------- ---------
30 June 2022
Non-interest bearing:
Trade and other payables - 652 - - -
Short term borrowings - - - - -
-------------------------- --------- ----------- --------- -------- ---------
30 June 2023
Non-interest bearing:
Trade and other payables - 191 - - -
Short term borrowings - - - - -
-------------------------- --------- ----------- --------- -------- ---------
24. Risk Management Objectives and Policies
The Group is exposed to a variety of financial risks which
result from both its operating and investing activities. The
Group's risk management is coordinated by the Board of Directors
and focuses on actively securing the Group's short to medium term
cash flows by minimising the exposure to financial markets.
The main risks the Group are exposed to through its financial
instruments and the operations of the Group are credit risk,
foreign currency risk, liquidity risk and market price risk. These
risks are managed by the Group's finance function together with the
Board of Directors.
Capital risk management
The Group's objectives when managing capital are:
-- to safeguard the Group's ability to continue as a going
concern, so that it continues to provide returns and benefits for
shareholders;
-- to support the Group's growth; and
-- to provide capital for the purpose of strengthening the Group's risk management capability.
The Group actively and regularly reviews and manages its capital
structure to ensure an optimal capital structure and equity holder
returns, taking into consideration the future capital requirements
of the Group and capital efficiency, prevailing and projected
profitability, projected operating cash flows, projected capital
expenditures and projected strategic investment opportunities.
Management regards total equity as capital and reserves, for
capital management purposes.
Credit risk
The Company's principal financial assets are bank balances and
cash and other receivables, which represent the Company's maximum
exposure to credit risk in relation to financial assets. The credit
risk on liquid funds is limited because the counterparties are
banks with high credit ratings assigned by international credit
rating agencies.
As at 30 June 2023, the Group's maximum exposure to credit risk
was GBP760,576 (2022: GBP636,854) comprising cash and cash
equivalents.
Liquidity risk
Liquidity risk arises from the possibility that the Group might
encounter difficulty in settling its debts or otherwise meeting its
obligations related to financial liabilities. The Group manages
this risk through maintaining a positive cash balance and
controlling expenses and commitments. The Directors are confident
that adequate resources exist to finance current operations.
Foreign Currency risk
The Group undertakes transactions denominated in foreign
currencies. Hence, exposures to exchange rate fluctuations arise.
Following the acquisition of African Tantalum (Pty) Ltd, the
Group's major activity has been in Namibia, bringing exposure to
the exchange rate fluctuations of GBP/GBP Sterling with the
Namibian Dollar and South African Rand, the currencies in which
most of the operating costs are denominated. It is expected that
the Group's future exposure will principally be to GBP South
African Rand foreign exchange fluctuations following the Company's
disposal of African Tantalum (Pty) Ltd. At the year end the value
of assets denominated in these currencies was such that the
resulting exposure to exchange rate fluctuations was not material
to the Group's operations.
Exchange rate exposures are managed within approved policy
parameters. The Group has not entered into forward exchange
contracts to mitigate the exposure to foreign currency risk.
The Directors consider the assets most susceptible to foreign
currency movements to be the Investment in Subsidiaries. Although
these investments are denominated in South African Rands their
value is dependent on the global market value of the available
Tantalite resources.
The table below details the split of the cash held as at 30 June
2023 between the various currencies. The impact due to movements in
the exchange rates is considered to be immaterial.
Currency 2023 2022
---------------- ------------ -------------
Namibian Dollar - NAD 173,234
South African ZAR 233,109 ZAR 220,360
Rand
Great British GBP 366,884 GBP 608,504
Pounds
US Dollars USD 480,289 -
Euros EUR 6,031 -
---------------- ------------ -------------
Total in GBP GBP 761,000 GBP 637,000
---------------- ------------ -------------
Market Price risk
Going forwards the Group's exposure to market price risk mainly
arises from potential movements in the market price of Tantalite.
The Group is managing this price risk by completing a fixed price
off-take agreement in respect of the major part of its planned
production.
25. Events After the Reporting Period
I n respect of the disposal of Aftan, the Company received
GBP795k in August 2023 and GBP264k in November 2023.
On 30 October, warrants over 39,397,643 Ordinary shares
exercisable at a price of GBP0.01 per share, lapsed
unexercised.
26. Related Party Transactions
The remuneration of the Directors, who are the key management
personnel of the Company, is set out in the report of the Board on
remuneration accompanying these financial statements.
During the year, Westleigh Investment Holdings Ltd ("WIHL")
received GBP55,000 (2022: GBP49,000) in respect of accounting,
administration and office accommodation services provided to the
Company. WIHL is a substantial shareholder in the Company and is
controlled by Giles Clarke and Nick Harrison (each of whom resigned
as directors on 8 July 2022).
As at 30 June 2022, the Company had an outstanding loan of
GBP199,000 with WIHL. This loan was repaid in January 2023.
As at 30 June 2022, GBP71,000 and GBP57,000 was owed to Giles
Clarke and Nick Harrison (each of whom was a director until 8 July
2022) respectively in unpaid salaries. These amounts were settled
in full in December 2022.
There have been no other material transactions with related
parties.
27. PRIOR YEAR ADJUSTMENT
The prior year comparatives for the Group have been restated
from those previously reported by the Company as shown below:
As previously
stated As restated
2022 Adjustment 2022
GBP'000 GBP'000 GBP'000
----------------------------------------------- ------------- ---------- -----------
Non-Current assets
Mines under construction 2,961 - 2,961
Property, plant and equipment 796 - 796
3,757 - 3,757
----------------------------------------------- ------------- ---------- -----------
Current assets
Trade and other receivables 279 - 279
Cash and cash equivalents 637 - 637
916 - 916
Current liabilities
Trade and other payables 652 - 652
652 - 652
----------------------------------------------- ------------- ---------- -----------
Non-Current liabilities
Other payables 826 (757) 69
Provisions 54 54
----------------------------------------------- ------------- ---------- -----------
880 (757) 123
----------------------------------------------- ------------- ---------- -----------
Net current assets / (liabilities) 264 - 264
Net assets 3,141 (757) 3,898
----------------------------------------------- ------------- ---------- -----------
Equity
Share capital 3,516 - 3,516
Share premium account 17,556 - 17,556
Capital redemption reserve 2,077 - 2,077
Share option reserve 443 - 443
Currency translation reserve (494) 757 263
Retained earnings (19,908) - (19,908)
----------------------------------------------- ------------- ---------- -----------
Equity attributable to owners of the Company 3,190 757 3,947
Non-controlling interests (49) - (49)
----------------------------------------------- ------------- ---------- -----------
Total equity 3,141 757 3,898
----------------------------------------------- ------------- ---------- -----------
Subsequent to the approval of the 2022 financial statements the
Board carried out a review of the prior year Other payables balance
of GBP826k shown in non-current liabilities. The Board concluded
that GBP757k of this balance related to amounts due from Deep Blue
Minerals (Pty) Ltd (DBM) to the Company. As DBM is a subsidiary of
the Company this amount should have been eliminated against the
corresponding receivable amount in the Company, in the consolidated
statement of financial position. However, the elimination had
instead been allocated to Currency translation reserve. The effect
of the adjustment to correct the error increases the Group's net
assets by GBP757k to GBP3.9m from the previously stated GBP3.1m.
There was no resulting impact on profit or loss.
28. Notes supporting statement of cashflows
Significant non-cash transactions from investing activities are
as follows:
2023 2022
GBP'000 GBP'000
--------------------------------------------- -------------- --------------
Consideration for the disposal of subsidiary 10,673 -
--------------------------------------------- -------------- --------------
See note 15
Reconciliation of net cash flow to movement in net debt
2023 2022
Group GBP000 GBP000
--------------------------------------------- -------- --------
Cash and cash equivalents 761 637
Borrowings - (474)
--------------------------------------------- -------- --------
Net debt 761 163
--------------------------------------------- -------- --------
Net increase in cash and cash equivalents
in the period 126 590
Cash flows from decrease/(increase) in
borrowings 474 (347)
Other non-cash changes (2) 16
Change in net debt resulting from cashflows 598 259
Net debt at the start of the year 163 (96)
--------------------------------------------- -------- --------
Net debt at the end of the year 761 163
--------------------------------------------- -------- --------
29. Ultimate Controlling Party
The Directors do not consider there to be one single ultimate
controlling party.
**S**
For further information on the Company, visit: www. kazeraglobal
.com .
Kazera Global plc kazera@stbridespartners.co.uk
Dennis Edmonds, CEO
Cavendish Capital Markets Ltd (Nominated Adviser and Broker) Tel: +44 (0)207 220 0500
Derrick Lee / Neil McDonald / Fergus Sullivan (Corporate Finance)
-----------------------------
St Brides Partners (Financial PR) kazera@stbridespartners.co.uk
Paul Dulieu / Isabel de Salis
-----------------------------
About Kazera Global plc
Kazera is a global investment company focused on leveraging the
skills and expertise of its Board of Directors to develop
early-stage mineral exploration & development assets towards
meaningful cashflow and production.
Its three principal investments are as follows:
(1) Alluvial diamond mining through Deep Blue Minerals (Pty)
Ltd, Alexander Bay, South Africa. Kazera currently has a 90% direct
interest in Deep Blue Minerals, of which 64% is held beneficially
by Kazera and 26% is held on behalf of Black Economic Empowerment
partners.
(2) Heavy Mineral Sands mining (including ilmenite, monazite,
rutile, and zircon) through Whale Head Minerals (Pty) Ltd,
Alexander Bay, South Africa. Kazera currently has a 60% direct
beneficial interest in Whale Head Minerals.
(3) Tantalite mining in South-East Namibia (divestment in
progress)
As announced on 20 December 2022, Kazera has agreed to dispose
of African Tantalum (Pty) Ltd ("Aftan") for a cash consideration of
US$13 million plus a debenture payment of 2.5% of the gross sales
of produced lithium and tantalum for life-of-mine. Completion of
the sale is subject to receipt of full consideration proceeds.
Aftan has been deconsolidated from the Company's financial
statements with effect from 4 January 2023 because in accordance
with the terms of the sale agreement, it has relinquished control
of the Aftan in favour of the purchaser, Hebei Xinjian Construction
Close Corp with effect from that date. Kazera retains the right to
cancel the transaction and retain all amounts paid to date in the
event of default by Hebei Xinjian.
The Company will consider additional investment opportunities as
appropriate, having regard to the Group's future cash flow
requirements.TER WILSON HAHA) LSON HAHA
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END
FR USVKRORUUAAA
(END) Dow Jones Newswires
December 15, 2023 02:00 ET (07:00 GMT)
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