TIDMROCK
RNS Number : 8371B
Rockfire Resources PLC
06 June 2023
The information contained within this announcement is deemed by
the Company to constitute inside information pursuant to Article 7
of EU Regulation 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 as amended .
6 June 2023
Rockfire Resources plc
("Rockfire" or the "Company")
Annual Results for the year ended 31 December 2022
Rockfire Resources plc (LON: ROCK), the base metal, gold and
critical mineral exploration company, announces its audited results
for the year ended 31 December 2022.
For further information on the Company, please visit
www.rockfireresources.com or contact the following:
Rockfire Resources plc : info@rockfire.co.uk
David Price, Chief Executive Officer
Allenby Capital Limited (Nominated Adviser Tel: +44 (0) 20
& Broker): 3328 5656
John Depasquale / George Payne (Corporate
Finance)
Matt Butlin / Kelly Gardner (Sales and
Corporate Broking)
Notes to Editors
Rockfire Resources plc (LON: ROCK) is a gold, base metal and
critical mineral exploration company, with a portfolio of
gold/copper/silver projects in Queensland Australia and a
high-grade zinc/lead/silver/germanium deposit in Greece.
-- The Molaoi deposit in Greece has a JORC resource of 210,000
tonnes of zinc, 39,000 tonnes of lead and 3.5 million ounces of
silver, using a 4% Zn cut off.
-- The Plateau deposit in Queensland has a JORC resource of
131,000 ounces of gold and 800,000 ounces of silver, using a 0.5g/t
Au cut off. 53,000 of these ounces lie within the top 100m from
surface.
-- The Copperhead deposit in Queensland has a JORC resource of
80,000 tonnes of copper, 9,400 tonnes of molybdenum and 1.1 million
ounces of silver, using a 0.13% CuEq. cut off.
CHAIRMAN'S STATEMENT
Rockfire has had a remarkable year of outstanding achievement.
The Company has, in a very short space of time, delivered a JORC
gold resource, a JORC silver resource, a JORC copper resource and
now a JORC zinc/lead resource into its portfolio. This has resulted
in creating diverse material value across the Company's project
base.
Rockfire is in an enviable position of having accumulated JORC
resources of:
-- 130,000 ounces of gold and 800,000 ounces of silver at Plateau;
-- 120,000 tonnes of copper equivalent at Copperhead (comprising
80,000 tonnes of copper, 9,000 tonnes of molybdenum and 1.1 million
ounces of silver); and
-- 250,000 tonnes of zinc equivalent at Molaoi in Greece
(comprising 210,000 tonnes of zinc, 39,000 tonnes of lead, and 3.5
million ounces of silver).
2022 saw the Company focus its financial and human resources on
the Molaoi zinc/lead/silver deposit in Greece. This decision was
made owing to the very high grades attained at Molaoi in historical
drilling. In addition to this, Molaoi benefits from vast amounts of
historical exploration expenditure, which resulted in the drilling
of 173 diamond holes, two rounds of metallurgical test work, a
financial and technical feasibility study as well as the
development of a portal and decline to the orebody. Molaoi
represents a very advanced project and Rockfire is aiming to
achieve underground production within the next 3 years.
As we strive to complete our confirmatory and in-fill drilling
during the next 12-month period, our team is preparing for
environmental and feasibility studies which we hope to commence
towards the end of the next financial period.
I would like to congratulate our excellent teams in Greece and
Australia who have worked tirelessly during the year to complete so
many milestones. These include:
-- Winning the tender for Molaoi
-- Achieving a Maiden JORC resource at Copperhead (64 MT @ 0.19
% CuEq (120,000 tonnes of CuEq.)
-- Reanalysing the old drill core at Molaoi
-- Discovering germanium at Molaoi
-- Achieving a Maiden JORC at Molaoi (2.3 MT @ 11 % ZnEq. for
250,000 tonnes of ZnEq.)
-- Hosting a technical site visit by the Company's nominated
advisor and broker, Allenby Capital
-- Completing the submission of an Environmental Study
-- Applying for, and being accepted into ERMA (European Raw Materials Alliance)
-- Identifying all landowners and completing initial consultations at Molaoi
-- Commencing our field-based exploration activity at Molaoi
-- Achieving excellent recoveries of zinc (89%) and lead (74%)
from metallurgical tests
-- Achieving commercially saleable grades of zinc (57% Zn),
silver (856 g/t Ag), lead (63.6% Pb)
germanium (117 g/t Ge), copper (2.62% Cu) and gold (0.52 g/t Au)
at Molaoi
-- Completing the lease of a 10Ha parcel of land on top of the Molaoi resource
-- Successfully changing the sole trading Hellenic Minerals IKE
to a publicly unlisted Hellenic Minerals SA company structure after
the acquisition by Rockfire
-- Providing 4 x defibrillators to each of the public schools in
Molaoi as part of the Company's Health, Safety and Environment
plan
-- Smooth and on-time commencement of diamond drilling at Molaoi
-- Location and excavation of the old portal site
-- Locating and sampling very high zinc, lead and silver grades
from old shafts and outcrop
-- Successfully encountering massive sulphides in the first
geotechnical drill hole at Molaoi at the predicted position
-- Signing a lease over a parcel of land suitable for core
processing/site office/equipment storage
I proudly present to you, the Annual Report for Rockfire
Resources for the financial year ended 31 December 2022 and look
forward to a very successful 2023 for all our shareholders.
Administration
The Company returned to in-person and hybrid meetings, including
board meetings and presentations to investors during the year. The
Company held its Annual General Meeting as a hybrid
virtual/gathered meeting. Owing to geographical diversity, all
board meetings throughout the year were held remotely, with
directors meeting at least once a month (and often more regularly)
throughout the year.
Financial review
The consolidated statement of comprehensive income for the year
shows a loss of GBP614,329 (2021: loss GBP907,783).
Rockfire is very proud that it was able to restrict its raising
of exploration funds to only one fundraise during the calendar year
and still achieve so much exploration success.
On 17 October 2022, the Company announced that it had
successfully completed a subscription of new ordinary shares in the
Company, raising gross proceeds of GBP375,000. This subscription
was through the Company's sole broker, Allenby Capital Limited, and
comprised 240,000,000 new ordinary shares of 0.1 pence each in the
Company being placed with an institutional investor, at an issue
price of 0.125 pence per share.
In addition, certain Rockfire employees including several
Directors subscribed for an aggregate of 60,000,000 new ordinary
shares at the same issue price. In total, 300,000,000 new ordinary
shares were issued pursuant to the subscription.
The total issue represented approximately 20.87 per cent. of the
enlarged issued share capital of the Company at the time.
On 1 June 2023, the Company announced that it had successfully
raised GBP880,000, before expenses, through Paloma Precious DMCC
subscribing for 400,000,000 new ordinary shares of 0.1 pence each
at a price of 0.22 pence per share, representing approximately 21.7
per cent. of the issued share capital of the Company as enlarged by
the subscription.
Exploration review
Molaoi, Greece
Rockfire's exploration activities for 2022 started very
positively with an announcement on 8 March that it had won an Open
International Tender for the exploration and exploitation rights to
the high-grade Molaoi zinc deposit in Greece. Winning the tender
provided Rockfire with 100% ownership of a 30-year licence to
explore and mine the Molaoi deposit, located in the Peloponnese
region of Greece. Molaoi is an outstanding high-grade zinc deposit,
and Greece offers a low-risk jurisdiction with a modern mining
legislation and an active and progressive mining industry making it
an attractive destination for the Company.
Successfully verifying the high grades reported by previous
explorers provided a big step towards de-risking the project and
provided enormous encouragement for the team to move forward
rapidly with resource expansion plans.
The Molaoi project took an unexpected but very positive turn
when it was announced to the market on 10 May 2022 that re-analysis
of the historical drill core had discovered the presence of one of
the world's critical metals, germanium. Critical metals are metals
deemed vital for world economies to continue to provide technology.
The supply of germanium is largely at risk due to geological
scarcity. The European Union Environmental Agency includes
germanium in the top 20 raw materials which have been identified by
the European Commission as being critical metals owing to risk of
supply shortages.
The team successfully delivered a maiden inferred mineral
resource estimate for Molaoi in May 2022. The mineral resource
surpassed all expectations and demonstrated the quality and
potential of the project. The inaugural JORC resource estimation
for Molaoi delivered an inferred mineral resource of 2.3 million
tonnes @ 11 % ZnEq. for 250,000 tonnes of ZnEq. Using a 4%
low-grade cut, individual elemental grades are 9.4 % Zn, 1.7 % Pb
and 47 g/t Ag. This resulted in 210,000 tonnes of zinc, 39,000
tonnes of lead and 3.5 million ounces of silver being included in
the maiden resource.
Importantly, only 1,400 m of a potential strike extent of 7 km
has been included in the resource and the resource remains open at
depth and along strike. In addition to this, multiple parallel
mineralised lodes are not included in the resource and are yet to
be fully tested. The presence of parallel lodes may add materially
to the resource in future estimates.
Results of metallurgical tests commissioned by Rockfire report
excellent recoveries of zinc (89%) and lead (74%). Commercially
saleable grades of zinc (57% Zn), silver (856 g/t Ag), lead (63.6%
Pb), germanium (117 g/t Ge), copper (2.62% Cu) and gold (0.52 g/t
Au) are readily achieved at Molaoi.
Rockfire was delighted to announce in November 2022 that
geotechnical drilling was underway in Greece. An initial 4 holes
(for a total of 840m) are planned to be drilled within the main
mineral resource of 2.3Mt @ 11% zinc equivalent. These initial 4
geotechnical holes are expected to be followed by more holes to
gather geotechnical information throughout the 1.5km of the
resource and beyond. The average depth of drilling is 210m with the
deepest hole planned to reach 270m below surface.
Both massive and semi-massive sulphides were encountered in
Rockfire's first drill hole at a depth and position predicted from
historical drill data. Between 1979 and 1988, 173 diamond drill
holes were drilled at Molaoi, as well as metallurgical tests, a
feasibility study and the development of a portal and decline to
the orebody. The Company's exploration and exploitation permit
allows Rockfire to capitalise on this excellent work by the Greek
Government to help monetise the project in a timely manner.
Management considers Molaoi to be an outstanding base metal
project, which we hope will grow to a globally significant scale.
The quality of the grades and quantity over the first 1,400 m
strike extent is testimony to the potential size of Molaoi,
particularly if our planned exploration along strike proves to be
successful.
Lighthouse, Queensland
The Lighthouse tenement includes the Plateau gold deposit, where
an Inferred JORC resource has been drilled by Rockfire of 3.9
million tonnes @ 1.1 g/t Au and 6.4 g/t Ag (0.5g/t cut-off), for
131,302 ounces of gold and 800,000 ounces of silver. The tenement
also comprises the Cardigan Dam, Split Rock and Double Event
prospects.
The Company completed soil and rock sampling during the year. A
total of 557 soil samples were collected from four sites within the
Lighthouse tenement and results of this work returned strongly
elevated gold results. Rockfire's management believes that the soil
anomaly may present a target, based on high-grade gold-in-rock
samples as well. Ongoing mapping and rock sampling at Plateau
identified multiple new targets close to the drilled JORC gold
resource. Seventeen (17) rock samples were collected, with results
including 10.7 g/t Au, 3.2 g/t Au and 2.3 g/t Au.
The new targets combined could add material ounces to the
already-defined gold resources.
Copperhead, Queensland
At the start of the reporting period, Rockfire had recently
completed a diamond drilling programme and an update to the market
was provided on 20 January 2022. This update included assay results
for the third diamond drill hole (BCH003), which returned 370 m @
0.20 % CuEq. from 57 m. Hole BCH003 significantly expanded copper
mineralisation by 100 m directly east of hole BCH001 and 200 m
north of hole BCH002, resulting in another significant increase in
the footprint of the drilled copper-bearing area.
Based on drilling 5 deep diamond holes at Copperhead, Rockfire
announced a maiden inferred JORC mineral resource of 64 million
tonnes @ 0.19% CuEq. for 120,000 tonnes of copper equivalent on 21
March 2022.
The mineral resource remains open to the north, east, west and
at depth, leaving scope for significant, further resource
increases. With continued exploration success and expansion of the
resource, Copperhead demonstrates potential to form a low-cost,
bulk-tonnage, open cut mining scenario.
Copper Dome
A three-dimensional interpretation of an airborne
helicopter-supported magnetic survey had been commissioned at the
end of the previous reporting period to determine the
characteristics of the magnetic response at depth. This 3D
interpretation highlighted two large, strongly magnetic bodies
lying approximately 500m below the surface. These bodies were both
characterised by long intervals of low-grade copper and gold
immediately above them, which had been discovered in historical RC
drilling.
Copper Dome remains a highly prospective porphyry copper/gold
target for Rockfire but no further work was completed during the
2022 calendar year.
Material events and reviews since the end of 2022
Lighthouse, Queensland
Rockfire announced on 20 January 2023 that the Company has
entered into a new joint venture ("JV") at the Plateau gold deposit
in Queensland, Australia. The purpose of the JV will be to test
regional targets, as well as the discovery of higher-grade gold,
close to Rockfire's JORC resource.
-- Rockfire has entered into a binding heads of agreement with
Sunshine Gold Limited ("Sunshine") to advance the Plateau gold
deposit. Sunshine is listed on the Australian Stock Exchange
(ASX:SHN)
-- The JV includes the Lighthouse tenement (EPM25617) and the
adjoining Kookaburra tenement (EPM26705) (together the
"Tenements")
-- The JV will result in Sunshine sole-funding exploration at
Plateau for the next 3 years, with funding being engaged on direct
exploration activity
-- Rockfire intends to focus its financial, logistical and human
resources on the Molaoi zinc deposit in Greece, which hosts an
Inferred, high-grade JORC resource of 2.3 million tonnes @ 9.4%
zinc, 1.7% lead and 47g/t silver for 250,000 tonnes of zinc
equivalent. The critical mineral, Germanium has also been
discovered, associated with zinc
-- The Plateau gold deposit has a quoted Inferred JORC resource
of 3.9 million tonnes @ 1.1g/t gold and 6.4g/t silver, using a
0.5g/t Au cut off
-- Sunshine will target potential for additional ounces in the
top 100m from surface, where the JORC resource is quoted as
Indicated and Inferred 1.4 million tonnes @ 1.2g/t Au and 8.8g/t
Ag, (using a 0.5g/t Au cut off), for a total of 53,336 ounces of
gold
-- Regional targets within the Lighthouse tenement, including
Double Event, Cardigan Dam, Bluff Creek, Bullseye, Rollston River,
Warrawee, Lower Lighthouse and Horse Creek will also be a focus for
Sunshine to delineate near-surface resources at each of these
regional prospects
-- Rockfire has the option to retain 25% ownership of the
Plateau gold project by participating in 25% expenditure in
on-going exploration, or the Company may elect to convert its right
over a 25% share of the Tenements to a 1.5% net smelter royalty.
With this structure, any discovery success by Sunshine will
directly benefit shareholders of Rockfire
The establishment of this joint venture is a positive step for
the Plateau project and for Rockfire generally. The JV enables our
team to focus its efforts on the Molaoi project in Greece and
allows for the advancement of Plateau at the same time. The joint
venture structure is designed so that Sunshine will sole-fund
exploration costs on the project with minimum allowance for
administration costs.
Sunshine is an excellent JV partner with a proven track record
of thorough and sustained drilling. The Sunshine team is
experienced and dedicated to discovery and Rockfire's management
believes that Plateau is in good hands with Sunshine as a quality
partner.
-- The JV includes the Lighthouse project exploration permit
EPM25617 and the adjoining Kookaburra exploration permit EPM26705
in Queensland
-- As at 30 June 2022, the Company's last announced financial
statements, the Tenements accounted for GBP1,569,459 of the
Company's intangible assets. As all expenditure on the Tenements is
capitalised, there were no losses or profits attributed to the
Tenements
-- During the sole funding period, Sunshine must keep the
Tenements in good order and meet all statutory reporting,
rehabilitation, and expenditure obligations
-- On the occurrence of each milestone set out in the table
below, Sunshine will acquire the corresponding participating
Interest in the Tenements
Until the point that Sunshine reaches the stage 1 milestone,
Sunshine will have no participating interest in the Tenements.
Stage Milestone Total participating Time frame
interest earned
by Sunshine
at end of stage
Sunshine has sole Maximum of 1
funded AUD $600,000 Year from execution
1 in expenditure 40% date
--------------------- -------------------- ----------------------
Sunshine has sole
funded a further Maximum of 2
AUD $600,000 years from execution
2 in expenditure 51% date
--------------------- -------------------- ----------------------
Sunshine has sole
funded a further Maximum of 3
AUD $1,000,000 years from execution
3 in expenditure 75% date
--------------------- -------------------- ----------------------
The expenditure requirement for each stage 1, 2 and 3 is
independent of the other stages and not cumulative.
At the conclusion of stage 3, Rockfire has 60 days from receipt
of all data and reports and proposed program and budget, by written
notice to elect to either contribute its 25% share of on-going
exploration and development expenditure or convert its 25% share to
a 1.5% net smelter royalty.
The terms of the net smelter royalty are to be based on the
standard Energy & Resources Law Association (formerly AMPLA
Ltd) template.
Molaoi, Greece
On 23 January 2023, Rockfire announced that results from the
Company's geotechnical drilling programme at the Molaoi zinc
deposit in Greece include multiple, high-grade intersections which
demonstrates the quality of the Molaoi deposit. Confirmation of
multiple lodes provides an opportunity to significantly increase
tonnage and will potentially have a considerable positive impact on
the future economics of the project.
MO_GTK_001 was drilled halfway between historical drill holes to
provide sufficient sample for geotechnical test work. Historical
drilling encountered several possible parallel lodes and MO_GTK_001
confirms that Molaoi comprises multiple lodes and perhaps as many
as four stacked, high-grade lodes.
Main Lode
13.4% ZnEq. over 7.18m width, from 130.62m (11.3% Zn, 1.4% Pb
and 50g/t Ag).
Second Lode
15.6% ZnEq. over 0.17m width, from 142.60m (14.3% Zn, 0.5% Pb
and 41.80g/t Ag)
Third Lode
10.7% ZnEq. over 1.73m width, from 144.90m (8.3% Zn, 1.3% Pb and
62g/t Ag)
Fourth Lode
19.5% ZnEq. over 2.24 m width, from 161.10m (16.6% Zn, 3.1% Pb
and 36g/t Ag)
Overall the main, second and third lodes comprise a broad
mineralised zone with an intersection of 7.5% ZnEq. over 16m width
from 130.62m (6.2% Zn, 0.8% Pb and 31 g/t Ag).
The highest individual samples are 20.5% Zn and 93.4g/t Ag over
1.25m (from 132.15m depth) and 4.1% Pb over 1.0m (from
161.10m).
Core samples from the mineralised lodes will contribute towards
a compilation sample to commence crushing and grinding work index
studies.
Assay results of this magnitude and width provide management
with ever-increasing confidence that we can proceed rapidly towards
a resource upgrade and commence feasibility studies before the end
of the 2023 calendar year.
Share subscription
As mentioned above, on 1 June 2023, the Company announced that
it had raised GBP880,000, before expenses, through a subscription
of 400,000,000 new ordinary shares.
We wish to thank all our shareholders for their continuing
support as we build further value in our projects. With gold,
silver, copper, molybdenum, zinc and lead JORC resources, Rockfire
is in an enviable position to capitalise on this time of increasing
commodity demand and rising prices.
Gordon Hart
Chairman
6 June 2023
DIRECTORS' BIOGRAPHIES
Gordon Hart, Chairman
Gordon has over 35 years of experience in the equity capital and
financial advisory markets. He spent 12 years from 2004 to 2016 as
Managing Director of Venture Group Equities Pty. Ltd, where he
advised on transactions involving over US$300 million of funding.
He is a graduate of the Australian Institute of Company Directors
and has a Graduate Diploma in Corporate Governance. Gordon brings a
wealth of corporate knowledge, equities and finance expertise and
emerging company experience to Rockfire.
David Price, Chief Executive Officer and Managing Director
David is an experienced geologist and senior executive with over
30 years of experience in the global mining industry and over 20
years' experience in securing funding for exploration projects.
David is a Fellow of the Australasian Institute of Mining and
Metallurgy (FAusIMM) and is a Competent Person for Mineral
Exploration under the guidelines of the JORC Code.
During his career, David has been involved with many resource
projects. He was Country Manager for Danae Resources during the
drill-out and Pre-Approval Study of the Sappes gold project in
Greece. He was the Senior Consulting Geologist during the drill-out
of Australia's second-largest lithium resource at Earl Grey in
Australia.
David has previously held senior roles in both listed and
private resource companies, including CEO of Golden Tiger Mining
Limited, CEO of Convergent Minerals Limited and Managing Director
of Millennium Mining Limited.
Ian Staunton, Non-executive Director
Ian has worked in the City of London for more than 40 years in a
range of role, including Audit Partner, Corporate Finance Partner
and Equity Partner in various accounting firms. He is a retired
Fellow of the Institute of Chartered Accountants in England and
Wales and has a Diploma in Corporate Finance. Having worked as
Equity Partner and Head of Capital Markets for Chantrey Vellacott
DFK LLP and a Senior Equity Partner for Moore Stephens during the
last 25 years, Ian provides Rockfire with a strong level of
accounting and audit experience. Such high-level accounting, audit
and compliance capability fulfils Rockfire's ambition to broaden
its corporate skill base and to bring unparalleled experience and
expertise from London onto the board. Ian is the Chairman of the
Audit Committee.
Patrick Elliott, Non-executive Director
Pat is an experienced resources and industrial company director.
In a career spanning over 45 years, he has held senior executive
positions with Consolidated Gold Fields (Australia) Limited and
Morgan Grenfell Australia Limited. Pat has an MBA in Mineral
Economics from Macquarie University and a B Comm from the
University of New South Wales. He has extensive management
experience in various fields, including manufacturing, mineral
exploration, and oil and gas exploration. Pat is currently
Executive Chairman of Cap-XX Limited and Chairman of Argonaut
Resources NL (an ASX-listed copper explorer). He is also a
Non-Executive Director of Tamboran Resources Limited and Kirrama
Resources Limited (an unlisted explorer and developer of chromite
and manganese projects in Madagascar).
Nicholas Walley, Non-executive Director
Nicholas has a business background spanning multiple industries,
including agriculture, property, construction, plant hire, food and
beverage packaging, leisure and charitable work. He has critical
skills in logistics, infrastructure, organisational management and
sales.
STRATEGIC REPORT
Molaoi Zinc Project, Greece
Rockfire's exploration activities for 2022 started very
positively with an announcement on 8 March 2022 that it had won an
Open International Tender for the exploration and exploitation
rights to the high-grade Molaoi zinc deposit in Greece. Winning the
tender provided Rockfire with 100% ownership of a 30-year licence
to explore and mine the Molaoi project, located in the Peloponnese
region of Greece. Molaoi is an outstanding high-grade zinc deposit,
and Greece offers a low-risk jurisdiction with a modern mining
legislation and an active and progressive mining industry making it
an attractive destination for the Company.
The Greek State drilled 173 cored diamond holes between 1979 and
1988, largely concentrated in a strike length of 1.5 km long.
Multiple, stacked, zinc-bearing layers have been mapped over a
total strike length of 7 km, providing enormous upside for
additional expansion of zinc mineralisation. Some of the
outstanding results from historical drilling at Molaoi include:
-- 10.4 m @ 10.63 % Zn, 1.45% Pb, & 62 g/t Ag (AN011, from 79 m)
-- 15.0 m @ 11.94 % Zn, 1.96% Pb, & 66 g/t Ag (AN017, from 136 m)
-- 7.0 m @ 14.96 % Zn, 2.13% Pb, & 63 g/t Ag (AN028, from 187 m)
-- 7.0 m @ 19.17 % Zn, 2.89% Pb, & 76 g/t Ag (B010, from 43 m)
-- 9.9 m @ 18.06 % Zn, 2.87% Pb, & 91 g/t Ag (B011, from 184 m)
-- 2.8 m @ 26.51 % Zn, 1.87% Pb, & 80 g/t Ag (BG013, from 57 m)
Zinc mineralisation starts at surface and has been extensively
drilled down to approximately 220 m, where 5.15 m @ 10.8% Zn, 3.8%
Pb, & 37g/t Ag was encountered. Mineralisation remains open at
depth.
On 11 April 2022, the Company announced that the historical
drill core had been located, photographed, and sampled as part of
the Company's technical due diligence of the Molaoi deposit. The
core has been stored under cover by the Greek Government and the
original sampling intervals have been kept wrapped in plastic. This
meant that we have been able to sample the precise interval as that
selected in the 1980's. A total of 51 samples of the old core were
taken to verify a spread of original assays ranging from 0.9% Zn to
a maximum of 36.75% Zn. The samples collected for re-assay were
specifically selected to represent a spatial spread to include the
entire 1.5 km distance, where most of the historical drilling
occurred.
The results of the core re-analysis were announced on 3 May 2022
and demonstrated that the core has successfully verified the high
grades reported by previous explorers, with zinc, lead and silver
values closely replicating historical analysis. This verification
provided a big step towards de-risking the project and provided
enormous encouragement for the team to move forward rapidly with
resource expansion plans.
The highest individual assay returned was 0.5 m @ 34.1 % Zn,
12.9 % Pb and 474 g/t Ag. Not all the core was sampled and this
individual sample is within a broader zone which was not resampled
but grades 3 m @ 13.0 % Zn, 4.6 % Pb and 159.8 g/t Ag feature in
historical analysis.
The verification process formed part of Rockfire's technical
Quality Assurance/Quality Control (QA/QC) which is an important
aspect of achieving an inaugural JORC resource estimate.
Verification assays of this magnitude and accuracy confirm the
significance of the Molaoi project and contribute to overall
de-risking of the project.
The Molaoi project took an unexpected but very positive turn
when it was announced to the market on 10 May 2022 that re-analysis
of the historical drill core had discovered the presence of one of
the world's critical metals, germanium, at Molaoi.
Critical metals are metals deemed vital for world economies to
continue to provide technology. The supply of germanium is largely
at risk due to geological scarcity. The European Union
Environmental Agency includes germanium in the top 20 raw materials
which have been identified by the European Commission as being
critical metals, owing to risk of supply shortages.
The weighted average grade of the 51 samples collected during
the re-analysis of core is 51 grams per tonne (g/t) Ge, with a peak
value of 197 g/t Ge. 41% of samples returned germanium values above
50 g/t Ge.
Germanium is used in the manufacture of everyday technology
including mobile phones, electronics, solar cells, camera lenses,
satellites, computer screens, as well as steering and parking
sensors for vehicles. Germanium is also used in numerous military
applications including weapons-sighters (scopes) and infrared night
vision.
A maiden inferred mineral resource estimate for Molaoi was
announced on 23 May 2022. The mineral resource surpassed all
expectations and demonstrated the quality and potential of the
project. The resource is reported in accordance with the Joint Ore
Reserve Committee ("JORC") Australasian Code (2012) for Reporting
of Exploration Results, Mineral Resources and Ore Reserves.
The inaugural JORC resource estimation for Molaoi delivered an
inferred mineral resource of 2.3 million tonnes @ 11 % ZnEq. for
250,000 tonnes of ZnEq. Using a 4% low-grade cut, individual
elemental grades are 9.4 % Zn, 1.7 % Pb and 47 g/t Ag. This results
in 210,000 tonnes of zinc, 39,000 tonnes of lead, and 3.5 million
ounces of silver being included in the maiden resource. Only 1,400
m of a potential strike extent of 7 km has been included in the
resource and the resource remains open at depth and along strike.
In addition to this, multiple, parallel mineralised lodes are not
included in the resource, and are yet to be fully tested. The
presence of parallel lodes may add materially to the resource in
future estimates.
Metallurgical flotation test work completed in 1984 resulted in
96% zinc recovery, 92% lead recovery and 91% silver recovery into a
bulk concentrate. These recovery factors were applied to the
mineral resource to calculate the resulting zinc equivalent tonnes
and grade.
The top 40 m from surface were excluded from the mineral
resource as Rockfire is planning underground mining only to
minimise social and environmental impacts. Germanium was not
included in the maiden resource estimate owing to limited
quantitative analysis.
Management considers Molaoi to be an outstanding base metal
project, which we hope will grow to a globally significant scale.
The quality of the grades and quantity over the first 1,400 m
strike extent is testimony to the potential size of Molaoi,
particularly if our planned exploration along strike proves to be
successful.
Geological mapping and rock sampling throughout the Molaoi
licence commenced on 17 August 2022, with an announcement on the
same day detailing the initial work. Diamond drilling was being
planned to target the expansion of the maiden JORC resource.
A Greek exploration geologist and a local mining engineer were
appointed in late July 2022 to conduct exploration activities and
prepare for drilling. A lease was signed for the Company to lease a
core yard and field operations office, both located on the
exploration licence and close to the planned drilling at Molaoi.
Further, as part of the grant of the tender to Rockfire, a lease of
a 10-acre (4.06 Ha) parcel of surface land at Molaoi was granted to
the Company. The private lease transferred to Rockfire includes the
portal and decline to the historical underground mine, developed
during the late 1980s.
On 25 August 2022, Rockfire announced that preliminary
metallurgical tests from Molaoi have returned excellent recoveries
and concentrate grades for zinc, silver, lead and germanium. Copper
and gold have also reported to the concentrates, adding high
potential value to the future economics of the project. The
metallurgical recoveries and grades attained in this round of tests
significantly reduce process recovery and marketing risk.
Metallurgical test work is being supervised by the Company's
metallurgical consultants, BHM Process Consultants Pty. Ltd.
("BHM") in Perth, Western Australia, using core drilled by the
Greek Government.
Results of the metallurgical tests report excellent recoveries
of zinc (89%) and lead (74%). Commercially saleable grades of zinc
(57% Zn), silver (856 g/t Ag), lead (63.6% Pb), germanium (117 g/t
Ge), copper (2.62% Cu) and gold (0.52 g/t Au) are readily achieved
at Molaoi. Two flotation circuit tests were conducted, with
zinc/germanium (Concentrate 1) and lead/silver/copper/gold
(Concentrate 2).
First-pass metallurgical recovery of zinc is 89%, with this
figure likely to increase with more detailed tests. The performance
of the zinc system is reported by BHM as "excellent", with a
product grade of 57% Zn concentrate achieved in a single pass
through a 3-stage flotation circuit. This is well above the desired
product grade of 50% Zn contained for a saleable concentrate.
Germanium reports to the zinc concentrate with a commercially
competitive grade of 117 g/t Ge and is expected to be recovered as
part of the zinc concentrate. This is expected to be a valuable
credit in the concentrate.
First-pass metallurgical recovery of lead is 74%, with this
figure also expected to increase with more detailed test work. The
lead circuit recovery is at a greatly over-concentrated value of
63.6% Pb concentrate achieved in a single pass through a 3-stage
circuit configuration. This also far exceeds the market requirement
of 40% - 50% Pb contained for a saleable concentrate.
Silver recovery is 85.6% from the rougher tails, with 15.2% of
the silver reporting through to the lead concentrate at a grade of
856 g/t Ag, whilst copper and gold both reported to the lead
concentrate with grades of 2.62% Cu and 0.52 g/t Au.
BHM expects that these recovery figures may be conservative as
there is much metallurgical development and many optimisation tests
still to occur on the project. More definitive testing will be
initiated using core obtained from diamond drill core planned for
later in the year. This work will include crushing, milling and
abrasion work indices.
The Company announced on 2 November 2022 that the concrete
entrance to the old underground portal and decline has now been
exposed by excavation. Discussions held with people closely
associated with the mining activity in the 1980s indicate that the
mine was constructed with the use of steel and timber support
beams. It's therefore possible that the decline remains open and
clear beyond the portal. The decline was constructed using a 3.5m x
3.0m profile and varies in slope angle between an initial slope of
1:12 and steepening to a 1:7 rate of decline lower in the
decline.
Access agreements were signed in preparation for our initial
drill programme which is planned to consist of 4 geotechnical
holes. These holes are designed to gather information on ground
conditions to feed into underground mine design. These initial
holes will also provide material for crushing and grinding work
indexes and uniaxial compressive strength ("UCS") tests to measure
the ability of the rock to withstand stress once mining
commences.
Rockfire was delighted to announce on 21 November 2022, that
geotechnical drilling was underway in Greece. An initial 4 holes
(for a total of 840m) are planned to be drilled within the main
mineral resource of 2.3Mt @ 11% zinc equivalent. These initial 4
geotechnical holes are expected to be followed by more holes to
gather geotechnical information throughout the 1.5km of the
resource and beyond. The average depth of drilling is 210m d, with
the deepest hole planned to reach 270m below surface.
As part of the process to reach commercial extraction, the
geotechnical tests for which this core will be used form a critical
stepping-stone on the path to feasibility. The first holes are
designed to provide the following analytical and geotechnical
outcomes:
-- Confirmatory analysis to ensure correlation with previous assay results;
-- To gather geotechnical orientation and structural data to
refine the interpretation of the orebody at Molaoi;
-- To obtain core for UCS tests. These tests inform our mining
engineers of rock strengths when loads are applied/reduced in an
actual mining scenario; and
-- To obtain sufficient core for crushing and grinding work
indices. These tests determine the energy (and therefore cost) of
crushing and grinding the ore to a powder and will form a key
component of a feasibility study into the economics of the
project.
High-grade results of rock samples taken from historic mullock
(waste) dumps and surface outcrops were announced to the market on
28 November 2022. Zinc up to 25% Zn, lead up to 16.8% Pb and silver
up to 498g/t Ag were returned in rocks from waste dumps and outcrop
around old mine workings.
The highest results obtained are from the "Kalamaki" prospect,
where the JORC resource of 2.3Mt @ 9.4% Zn, 1.7% Pb and 47g/t Ag is
located. 9.3% Zn has been found in old workings at the "Fournos"
prospect, approximately 1.5km north of the JORC mineral resource.
Previous drilling by the Greek Government has encountered 3m @ 8.4%
Zn in diamond drill core at Fournos.
Zinc at 15.8% Zn has been found in old workings at the
"Mesovouni" prospect, approximately 1.0km northwest of the JORC
resource. Previous drilling by the Greek Government had encountered
3m @ 6.7% Zn in diamond drill core at Mesovouni. Similarly, 8.7%
Zn, 5.2% Pb and 161g/t Ag has been found in outcrop to the north of
the "Gkagkania" prospect, approximately 1.5km northwest of the JORC
resource. Previous drilling by the Greek Government had encountered
7m @ 10.2% Zn in diamond drill core at Gkagkania.
Being from the spoils (waste) around the opening of old
workings, it is testimony to the high grades of zinc, lead and
silver encountered during historical mining. Several high-grade
results were obtained from outcrops with no historical mining. This
emphasises the quality of targets to the north and northwest of the
main resource area.
On 12 December 2022, the market was informed that massive
sulphides had been encountered in drilling at the predicted depth
and position.
Both massive and semi-massive sulphides were encountered in
Rockfire's first drill hole at a depth and position predicted from
historical drill data. Between 1979 and 1988, 173 diamond drill
holes were drilled at Molaoi, as well as metallurgical tests, a
feasibility study and the development of a portal and decline to
the orebody. The
Company's exploration and exploitation permit allows Rockfire to
capitalise on this excellent work by the Greek Government to help
monetise the project in a timely manner.
Rockfire's first hole at Molaoi (MO_GTK_001) lies between
historical drill holes and will serve to provide core for
geotechnical test work to feed into a feasibility study. Massive
sulphides occur between 130m and 134m, with semi-massive and
disseminated sulphides continuing for a further 11m, down to 145m.
More disseminated sulphides have also been encountered at 160m
depth, which may represent a parallel lode beneath the main
lode.
It is expected that sufficient mineralised core will be obtained
to commence crushing and grinding work index studies. These studies
determine the energy (and therefore cost) required to crush and
grind the mineralised rock. The results from these studies are
parameters required for technical and financial feasibility
studies, which Rockfire plans to commence as soon as possible.
Lighthouse, Queensland Australia
The Lighthouse tenement includes the Plateau gold deposit, where
an Inferred JORC resource has been drilled by Rockfire of 3.9
million tonnes @ 1.1 g/t Au and 6.4 g/t Ag (0.5g/t cut-off), for
131,302 ounces of gold and 800,000 ounces of silver. The tenement
also comprises the Cardigan Dam, Split Rock and Double Event
prospects.
On 11 April 2022, the Company announced that 557 soil samples
had been collected from four sites within the Lighthouse tenement
and results of this work were released to the market on 21 June
2022. Soil sampling returned strongly elevated gold results which
outline a readily accessed and untested target at least 200 m long.
The target is outside the area included in the JORC resource.
Gold-in-soil values as high as 0.67g/t were encountered, as well as
2.3g/t silver. The soil anomaly is open along strike and extends
beyond the limit of the sampling grid. Rockfire's management
believes that the soil anomaly may present a target based on
high-grade gold-in-rock samples as well.
Ongoing mapping and rock sampling at Plateau identified multiple
new targets close to the drilled JORC gold resource and an
announcement on 2 August 2022 confirmed that numerous faults have
been identified. These faults are believed to carry fluids rich in
gold and are interpreted as structural controls on gold
mineralisation, including the Central Breccia and Eastern Breccia
resources at Plateau. A new structural interpretation was completed
which highlighted areas where dilation and rotation of the rocks
has occurred. This provides open space within the rocks for heated
and mineralised fluids to percolate through and deposit gold,
silver and other metals.
Seventeen (17) rock samples collected during June 2022 outline
two of the new exploration targets with results including 10.7 g/t
Au, 3.2 g/t Au and 2.3 g/t Au. Twenty-nine percent (29%) of the
rock samples returned results above 0.5 g/t Au, with more than 80%
of results being above 0.1 g/t Au.
Rockfire continued to target additional near-surface, open-cut
gold at Plateau. Soil sampling, rock sampling, geological mapping
and geophysics confirm the presence of additional gold targets
close to the edges of an intruded breccia (shattered rock), where
the previously drilled 131,302 ounces of gold resource is
positioned.
The new targets combined could add material ounces to the
already-defined gold resources. With five new targets showing
similar surface grades and dimensions to those in the two resource
areas, it is realistic to target multiples of the resources already
drilled.
Copperhead Porphyry Project, Queensland Australia
At the start of the reporting period, Rockfire had recently
completed a diamond drilling programme and an update to the market
was provided on 20 January 2022. This update included assay results
for the third diamond drill hole (BCH003), which returned 370 m @
0.20 % CuEq. from 57 m. Copper veins were observed throughout the
entire 429 m long drill hole. The drill hole finished in
copper-bearing veins.
Within this broad zone a higher-grade interval of 50 m @ 0.35 %
CuEq. occurs from 259 m downhole depth and a more intensely veined
interval of 22 m @ 0.41 % CuEq. has been intersected from 271 m
downhole depth. Hole BCH003 significantly expanded copper
mineralisation by 100 m directly east of hole BCH001 (501m @ 0.14%
CuEq.), and 200 m north of hole BCH002 (357m @ 0,11% CuEq.),
resulting in another significant increase in the footprint of the
drilled copper-bearing area.
Hole BCH003 is, to date, the highest-grade hole drilled at
Copperhead and long intervals including 62m @ 0.3% CuEq. is most
encouraging. The grade variability is typical of large porphyry
copper systems but importantly, the footprint of copper
mineralisation is expanding with each hole. This third hole
significantly expands the volume, and therefore tonnage, of the
deposit.
Based on drilling 5 deep diamond holes at Copperhead, Rockfire
announced a maiden inferred JORC mineral resource of 64 million
tonnes @ 0.19% CuEq. for 120,000 tonnes of copper equivalent on 21
March 2022.
Mineral Resource Statement (effective date 14th March 2022)
Cut-off Resource Tonnage Grade Contained Metal
(Grade Category (Mt)
Cu
Eq
%)
---------- -------- ------------------------------- ----------------------------------
Cu Cu Mo Ag (g/t) Cu Cu Mo Ag (M oz)
Eq % % Eq (Kt) (Kt)
% (Kt)
---------- -------- ----- ----- ------ --------- ------ ------ ------ ----------
0.13 Inferred 64 0.19 0.12 0.015 0.55 120 80 9.4 1.1
---------- -------- ----- ----- ------ --------- ------ ------ ------ ----------
The mineral resource remains open to the north, east, west and
at depth leaving scope for significant further resource increases.
The extent and tenor of mineralisation at Copperhead have yet to be
fully tested. Copper mineralisation starts at surface and continues
for at least 400 m vertically below surface. With continued
exploration success and expansion of the resource, Copperhead
demonstrates potential to form a low-cost, bulk-tonnage, open-cut
mining scenario.
Copper Dome
On 11 April 2022, it was announced that a landowner access and
compensation agreement had been signed with the landowner at the
Copper Dome porphyry project in Queensland.
A three-dimensional interpretation of an airborne
helicopter-supported magnetic survey had been commissioned at the
end of the previous reporting period to determine the
characteristics of the magnetic response at depth. This 3D
interpretation highlighted two large, strongly magnetic bodies
lying approximately 500m below the surface. These bodies were both
characterised by long intervals of low-grade copper and gold
immediately above them which had been discovered in historical RC
drilling.
Copper Dome remains a highly prospective porphyry copper/gold
target for Rockfire, but no further work was completed during the
2022 calendar year.
K EY PERFORMANCE INDICATORS (KPI's)
The Board monitors KPI's, which it considers appropriate for a
group at Rockfire's stage of development.
Financial KPI's
During the year, the Board monitored the following KPI's:
-- Cash flow and working capital;
-- Short-term and long-term cash flow models, which include
variance analysis from original budgets.
RISK MANAGEMENT
The Board regularly reviews the risks to which the Group is
exposed and ensures through its meetings and regular reporting that
these risks are minimised as far as possible.
The principal risks and uncertainties facing the Group at this
stage in its development are
Exploration risk
The Group's business has been primarily mineral exploration and
evaluation which are speculative activities and, whilst the
Directors are satisfied that good progress is being made, there is
no certainty that the Group will be successful in the definition of
economic mineral deposits, or that it will proceed to the
development of any of its projects or otherwise realise their
value.
The Group aims to mitigate this risk when evaluating new
business opportunities by targeting areas of potential where there
is at least some successful historical drilling or geological data
available.
Resource risk
All mineral projects have risk associated with defined grade and
continuity. Mineral reserves and resources are calculated by the
Group in accordance with accepted industry standards and codes but
are always subject to uncertainties in the underlying assumptions
which include geological projection and commodity price
assumptions.
The Group reports mineral resources and reserves in accordance
with the Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves ('the JORC Code'). The JORC Code
is a professional code of practice that sets minimum standards for
public reporting of mineral exploration results, mineral resources
and ore reserves. Further information on the JORC Code can be found
at www.jorc.org .
Environmental, landowner and native title risk
Exploration and development of a project can be adversely
affected by environmental legislation and the unforeseen results of
environmental studies carried out during evaluation of a project.
Once a project is in production, unforeseen events can give rise to
environmental liabilities.
Access and compensation agreements are required to be negotiated
between the Company and the landowner at each project. Queensland
legislation provides an agreement template which may be modified by
the Company and the landowner. The Company cannot guarantee
landowners will provide access, regardless of existing laws in
place to ensure such access is negotiated on fair terms.
Where native title exists, the Company obtains the necessary
approvals for access and working programmes according to
legislation and the Company's environmental, social and governance
("ESG") programme.
The Group is currently in the exploration stage. Any disturbance
to the environment during this phase is minimal and is
rehabilitated in accordance with the prevailing regulations of the
countries in which we operate.
Financing and liquidity risk
The Group has an ongoing requirement to fund its activities
through the equity markets and in the future to obtain finance for
project development. There is no certainty such funds will be
available when needed. To date, Rockfire has managed to raise funds
primarily through equity placements despite the very difficult
markets that currently exist for raising funding in the junior
mining industry.
Political risk
All countries carry political risk that can lead to interruption
of activity. Politically stable countries can have enhanced
environmental and social permitting risks, risks of strikes and
changes to taxation whereas less developed countries can have in
addition, risks associated with changes to the legal framework,
civil unrest and government expropriation of assets.
Bribery risk
The Group has adopted an anti-corruption policy and whistle
blowing policy under the Bribery Act 2010. Notwithstanding this,
the Group may be held liable for offences under that Act committed
by its employees or subcontractors, whether or not the Group or the
Directors had knowledge of the committing of such offences.
Insurance coverage
The Group maintains a suite of insurance coverage that is
appropriate for the Group and Company. This is arranged via a
specialist mining insurance broker and coverage includes public and
products liability, corporate and professional, travel, property
and medical coverage and assistance while Group employees and
consultants are travelling on Group business. This is reviewed at
least annually and adapted as the Group's scale and nature of
activities changes.
Internal controls and risk management
The Directors are responsible for the Group's system of internal
financial control. Although no system of internal financial control
can provide absolute assurance against material misstatement or
loss, the Group's system is designed to provide reasonable
assurance that problems are identified on a timely basis and dealt
with appropriately.
In carrying out their responsibilities, the Directors have put
in place a framework of controls to ensure as far as possible that
ongoing financial performance is monitored in a timely manner, that
corrective action is taken and that risk is identified as early as
practically possible. The Directors review the effectiveness of
internal financial control at least annually.
The Board continuously monitors and upgrades its internal
control procedures and risk management mechanisms and assesses both
for effectiveness during the annual review. This process enables
the Board to determine if the risk exposure has changed during the
year. In order to assist the risk management function, the Company
has a risk management policy, which is reviewed annually. The
Executive Directors report regularly to the Board on the management
of material business risks.
The Board, subject to delegated authority, reviews capital
investment, property sales and purchases, borrowing facilities,
guarantees and insurance arrangements.
CORPORATE SOCIAL RESPONSIBILITY
The Board takes account of the significance of social,
environmental and ethical matters affecting the business of the
Group. At this stage in the Group's development the Board has not
adopted a specific policy on corporate social responsibility as it
has a limited pool of stakeholders other than its shareholders.
Rather, the Board seeks to protect the interests of Rockfire's
stakeholders through individual policies and through ethical and
transparent actions.
SHAREHOLDERS
The Directors are always prepared, where practicable, to enter
into dialogue with shareholders to promote a mutual understanding
of objectives and outcomes. The Annual General Meeting provides the
Board with an opportunity to informally meet and communicate
directly with investors.
ENVIRONMENT
The Board recognises that the Group's principal activity,
mineral exploration, has the potential to impact on the local
environment. To date, activities at the various projects have been
limited to surveying and drilling activities and the Group does
comply with local regulatory requirements with regard to
environmental compliance and rehabilitation. The impact on the
environment of the Group's activities has the potential to increase
should our projects move into a development or production phase.
This is currently assessed through baseline environmental studies
that are being undertaken and identifying resources needed to
manage environmental compliance in the future.
Given the Group's size and scale it is not considered practical
or cost effective to collect and report data on carbon
emissions.
EMPLOYEES
The Group engages its employees to understand all aspects of the
Group's business and seeks to remunerate its employees fairly,
being flexible where practicable. The Group gives full and fair
consideration to applications for employment received regardless of
age, gender, colour, ethnicity, disability, nationality, religious
beliefs, transgender status or sexual orientation. The Group takes
account of employees' interests when making decisions and welcomes
suggestions from employees aimed at improving the Group's
performance.
The Group now operates in Queensland, Australia and Greece,
where it recruits locally as many of its employees and contractors
as practicable..
SUPPLIERS AND CONTRACTORS
The Group recognises that the goodwill of its contractors,
consultants and suppliers is important to its business success and
seeks to build and maintain this goodwill through fair dealings.
The Group has a prompt payment policy and seeks to settle all
agreed liabilities within the terms agreed with suppliers. The
Company encourages best practice from suppliers and contractors
with regards to environmental issues.
HEALTH AND SAFETY
The Board recognises that it has a responsibility to provide
strategic leadership and direction in the development of the
Group's health and safety strategy in order to protect all of its
stakeholders. The Group does not have a formal health and safety
policy at this time. This is re-evaluated as and when the Group's
nature and scale of activities change.
ENGAGEMENT WITH STAKEHOLDERS
The Board of Rockfire is proud of the high standard of corporate
governance it has established and maintains. The Board makes a
conscious effort to understand the interests and expectations of
the Company's stakeholders, and to reflect these in the choices it
makes in its effort to create long-term sustainable success for our
business.
Engagement with our shareholders and wider stakeholder groups,
including employees, landowners, suppliers, contractors and
government agencies, plays a central role throughout Rockfire's
business. The Board is aware that each stakeholder group requires a
specific and unique engagement approach in order to create and
maintain effective, sustainable and mutually beneficial
relationships.
The Board's understanding of various stakeholder interests is
factored into programme planning, boardroom discussions, strategy
and budgets to assess potential long-term impacts of our business
on each group, and how we might best address stakeholder
expectations from our business.
Throughout this Annual Report, we provide examples of how
we:
-- Take into account the likely consequences of long-term decisions;
-- Foster relationships with stakeholders;
-- Understand our impact on our local communities and the environment; and
-- Demonstrate the importance of behaving responsibly.
This engagement with stakeholders section forms our section 172
statement and should be read in conjunction with other information
included in this Annual Report. Section 172 of the Companies Act
2006 requires the Directors to act in a way that they consider, in
good faith, would most likely promote the success of the Company
for the benefit of its members as a whole, taking into account the
factors listed in section 172.
The Directors continue to observe, plan for, and communicate the
interests of the Company's stakeholders, including the impact of
its exploration activities on local communities and the
environment. Acting in good faith and fairly between members, the
Directors consider what is most likely to promote the success of
the Company for its members in the long term.
The Board regularly reviews its principal stakeholders and how
it engages with each. Stakeholder expectations are brought into the
boardroom throughout the annual cycle through information provided
by management and by direct engagement with stakeholders
themselves. The priority of each stakeholder group may increase or
decrease, depending on the degree of impact any decision may have
on any particular stakeholder group. The Board therefore seeks to
consider the impact and priorities of each stakeholder group during
its discussions and as part of its decision making.
The table below sets out the key stakeholder groups, their
interests and how Rockfire has engaged with them over the reporting
period. However, given the importance of stakeholder focus,
long-term strategy and reputation, these themes are also discussed
throughout this Annual Report.
Stakeholder Their interests How we engage
Our
investors * Comprehensive review of financial performance of the * Annual Report
business
* Company website
* Business sustainability
* Shareholder circulars
* High standard of governance
* Podcasts and interviews
* Success of the business
* Corporate information including Company announcements
* Ethical behaviour and presentations
* Director experience * AGM results
* Awareness of long-term strategy and direction * Conference presentations
* Project prospectivity * Stock exchange announcements
* Improving market perception of the business * Press releases
* Appointment of a public relations advisor
* Frequent communication through briefings with
management
* Shareholder communication policy, which is renewed
annually
* Specific shareholder liaison officer on the Board
(Chief Executive Officer)
* Social media
* One- to- one meetings with large existing or
potential new shareholders
----------------------------------------------------------- ------------------------------------------------------------
Regulatory
bodies * Compliance with regulations * Company website
* Worker pay and conditions * Stock Exchange announcements
* Health and safety * Annual Report
* Brand reputation * Regular contact with QCA, share registrar, LSE and
Companies House
* Waste and environment
* Compliance updates at Board meetings
* Insurance
* Risk management policy, updated annually
* Environmental protection
* Compliance with local regulatory requirements and
industry standard principles for environmental and
social risk management
* Appointment of a nominated advisor in accordance with
the AIM Rules
* Appointment of a competent person in accordance with
the AIM Rules
* Adhere to Australian and Greek laws and regulations
* Adoption of best practice policies recommended by the
World Bank and The International Council on Mining
and Metals
----------------------------------------------------------- ------------------------------------------------------------
Community
* Sustainability * Philanthropy. Drilling of a water bore is offered to
the landowner during each drill programme
* Human rights
* Corporate responsibility is overseen by a dedicated
exploration manager
* Community outreach
* Employment of local contractors wherever possible
* Prompt rehabilitation of drill sites
* Providing opportunity for local businesses to cater
for our exploration programs
* Local landowners are paid promptly
* Landowner access and compensation agreements
* Active communication with landowners and communities
where field work is taking place
* Adhere to Greek and Australian Government guidelines
for approaching landowner and native title holder
discussion
----------------------------------------------------------- ------------------------------------------------------------
Environment
* Energy usage * All operational waste is completely removed from site
and taken to a waste and/or recycling facility
* Recycling
* Detailed field operation guidelines to minimise any
negative environmental impact of exploration
* Waste management activities
* Obtaining environmental permits for exploration works
in Greece and Australia, granted by the relevant
Government
* Ensuring operational protocols are in place and
monitoring the adherence to these protocols
----------------------------------------------------------- ------------------------------------------------------------
Suppliers
* Terms and conditions of contract * All supplies are sourced locally where possible
* Procurement opportunities * Our suppliers and contractors have received repeat
business from Rockfire, which is testimony to the
fine working relationship established
* Workers' rights
* Supplier performance is continually monitored by a
* Supplier engagement dedicated exploration manager
* Sustainability * All field programs, including supplier quotes are
authorised by the Executive Directors prior to
implementation
* Long-term partnerships
* Local suppliers are paid promptly
* Fair trading and payment terms
* Contact and feedback to suppliers is regular and
personal via a dedicated exploration manager
----------------------------------------------------------- ------------------------------------------------------------
Contractors
* Terms and conditions of contract * All contractors are sourced locally where possible
* Health and safety * Contractors are trained in senior first aid, paid for
by Rockfire
* Human rights and modern slavery
* On-the-job training is provided
* Working conditions
* Local contractors are paid promptly
* Diversity and inclusion
* Rockfire pays contractors standard industry rates,
which are well in excess of minimum average wages
* Communication with contractors is frequent through a
dedicated exploration manager
* Induction for health and safety is mandatory for
contractors visiting site
* Daily safety meetings have been implemented during
all field operations
* Rockfire has a whistle-blower policy and procedure in
place to ensure compliance, safety and governance
* Code of conduct providing a framework for ethical
decision making
* Contact and feedback to contractors is regular and
personal via a dedicated exploration manager
* Anti-corruption and bribery policy
----------------------------------------------------------- ------------------------------------------------------------
On behalf of the Board
David Price, Chief Executive Officer
6 June 2023
DIRECTORS' REPORT
Principal activities
The principal activities of the Group are currently exploration
for gold and copper resources in Queensland, Australia and zinc,
lead, silver and germanium resources in Greece. The Group's
strategy is to explore for and, where the Directors believe that it
is commercially feasible, develop deposits of precious and base
metals. The Company strategy includes considering opportunities for
project sale or joint venture at a point when any of the Group's
projects becomes appropriately advanced enough to consider such
options.
The Group currently holds five exploration permits for minerals
(EPMs) in Queensland, Australia and one exploration/exploitation
licence in Greece.
Financial overview
The loss for the year is in line with the Directors'
expectations. With funding being raised in October 2022 and June
2023, the Directors are confident that they will be able to secure
additional funding when required to do so. The Directors are also
of the view that the investment sentiment in the resource sector is
improving, to the extent that the exploration success the Company
has achieved to date should enable it to raise sufficient
additional exploration funding to continue its exploration
programmes.
Further details of the Group's business, including its targets
and strategies is given in the Chairman's Statement and the
Strategic Report.
Major events after the reporting period
For information regarding events after the reporting date, see
note 19 to the financial statements.
Dividends
The Directors are unable to recommend the payment of a dividend
for the year ended 31 December 2022 (2021: GBPnil).
Going concern
The current investment environment in the United Kingdom and
elsewhere in the World has made seeking equity funds for small cap
exploration companies challenging. The Board is therefore
encouraged that in October 2022, the Company raised gross proceeds
of GBP375,000 through a subscription of 300,000,000 new ordinary
shares of 0.1p each and in early June 2023, the Company raised
gross proceeds of GBP880,000 from the issue of 400,000,000 new
ordinary shares of 0.1p each. This will enable the Group to meet
existing liabilities plus enable further exploration, especially at
its Molaoi project in Greece.
The Board believes the Group will continue to generate
sufficient working capital to meet its future operational and
exploration requirements and to continue to advance them and will
continue to have the ongoing support of its shareholders, as
required, for the foreseeable future.
Directors
The Directors in office during the year are listed below. The
interests of the Directors in the shares of the Company, and share
options were as follows:
As at 31 December 2022 As at 31 December 2021 As at 31 December 2022 As at 31 December 2021
Ordinary shares Ordinary shares Options Options
Gordon Hart 18,423,530 8,823,530 10,000,000 10,000,000
Patrick Elliott 40,042,765 12,469,823 6,000,000 6,000,000
Ian Staunton - - 6,000,000 6,000,000
Nicholas Walley 75,200,000 59,000,000 6,000,000 6,000,000
David Price 46,350,000 13,850,000 10,000,000 10,000,000
Significant shareholdings
As at 4 May 2023 , the Company was aware of the following
holdings of 3% or more of the issued share capital of the
Company:
Ordinary shares % of the Company's issued share capital
Nicholas Walley 75,200,000 5.21%
Michael Somerset-Leeke 49,101,126 3.40%
Patrick Elliott 47,350,991 3.28%
David Price 46,350,000 3.21%
Directors' remuneration
Full details of Directors' emoluments are set out in note 5 to
the financial statements.
Environmental policy
The Group's projects are subject to the relevant Australian and
Greek laws and regulations relating to environmental matters.
The Group's strategy is to explore for and, where the relevant
studies indicate that it is economically viable to do so, to
develop mineral deposits. It is the Group's intention to conduct
its exploration and investigation activities in a professional and
responsible manner, for the benefit of the Company's shareholders,
its employees and the national and local communities within which
it operates.
The Group aims at all times to conduct its operations in an
environmentally responsible manner and in accordance with relevant
legislation. The Group aims to adopt best practice policies as
recommended by the World Bank, the International Council on Mining
& Metals ("ICMM") and others where the Group deems local
legislation to be inadequate in terms of environmental protection.
The Group has in place a detailed field operations guidelines
manual which covers in considerable detail the measures to be taken
by field personnel to minimise any negative environmental impact of
current exploration activities on the environment.
The Group also recognises the enormous potential of its
activities for positive impact on the communities in which it
operates and strives to optimise these positive impacts as far as
possible.
Directors' indemnities
The Group has directors' and officers' indemnity insurance to
cover its Directors and officers against the costs of defending
themselves in legal proceedings taken against them in that capacity
and in respect of any damages resulting from those proceedings.
Political contributions
No political contributions have been made.
Auditor
A resolution proposing that PKF Littlejohn LLP be re-appointed
will be put to the forthcoming Annual General Meeting.
Statement of disclosure to auditor
The Directors who held office at the date of approval of this
Annual Report confirm that, so far as they are each aware, there is
no relevant audit information of which the Company's auditor is
unaware and each Director has taken all steps that he ought to have
taken as a Director in order to make himself aware of any relevant
audit information and to establish that the Company's auditor is
aware of that information.
Statement of Directors' responsibilities
The Directors are responsible for preparing the Strategic
Report, the Director's Report and the financial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the Directors
have prepared the Group and Company financial statements in
accordance with UK-adopted international accounting standards and
as regards the Company financial statements, as applied in
accordance with the requirements of the Companies Act 2006.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and the Company and of
the profit or loss of the Group and Company for that period.
In preparing the Group and Company financial statements, the
Directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether they comply with UK-adopted international
accounting standards, subject to any material departures disclosed
and explained in the financial statements;
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and Company
will continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group's and the
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Group and the Company and enable
them to ensure that the financial statements comply with the
Companies Act 2006. They are also responsible for safeguarding the
assets of the Group and the Company and hence for taking reasonable
steps for the prevention and detection of fraud and other
irregularities.
The Group's Annual Report will be published on the Group's
website and in this regard the Directors accept responsibility for
the maintenance and integrity of the website.
Annual General Meeting and recommendation
The Board considers that the resolutions to be proposed at the
Annual General Meeting are in the best interests of the Company and
the Group as a whole and its unanimous recommendation is that
shareholders support these proposals as the Directors intend to do
in respect of their own holdings. Further details regarding the
location and timing of the Company's forthcoming Annual General
Meeting will be provided shortly.
We welcome you to continue to take the journey with us as we
build Rockfire through exploration success and quality asset
acquisition.
On behalf of the Board
David Price, Chief Executive Officer
6 June 2023
CORPORATE GOVERNANCE STATEMENT
FOR THE YEARED 31 DECEMBER 2022
As Chairman of Rockfire, it is my responsibility to ensure that
Rockfire has both sound corporate governance and an effective
Board. I do that by ensuring that the Company and the Board are
acting in the best interests of shareholders, and by making sure
that the Board discharges its responsibilities. This includes
creating the right Board dynamic and ensuring that all important
matters, in particular strategic decisions, receive adequate time
and attention at Board meetings.
My responsibilities include leading the Board effectively,
overseeing the Group's corporate governance model, communicating
with shareholders and ensuring that good information flows freely
between the Executive and Non-executive Directors in a timely
manner.
To the extent applicable, and to the extent able (given the
current size and structure of the Company and the Board), the
Company has adopted the Quoted Companies Alliance Corporate
Governance Code (the Code). Details of how the Company complies
with the Code are set out below, together with the principles
contained in the Code.
In light of the Company's size and nature, the Board considers
that the current Board is a cost effective and practical method of
directing and managing the Company. As the Company's activities
develop in size, nature and scope, the size of the Board and the
implementation of additional corporate governance policies and
structures will be reviewed. Further disclosures under the Code are
included on the Company's website.
Principle 1 - Establish a strategy and business model which
promote long-term value for shareholders
Rockfire is an AIM-quoted mineral explorer with projects located
in northern Queensland, Australia and the Peloponnese region of
Greece. The Company's strategy is to identify mineral deposits
which can be developed into mines to create value and income for
shareholders.
Throughout 2022, the Board has delivered on its strategy to
achieve growth of the Group, with highly successful exploration
results at Molaoi in Greece and at the Plateau gold deposit and
Copperhead project, in Queensland, Australia.
The Company continues to seek other resource projects.
Principle 2 - Seek to understand and meet shareholder needs and
expectations
NEEDS OF SHAREHOLDERS
The principal need of a shareholder is to achieve a return on
their investment
EXPECTATIONS OF SHAREHOLDERS
A shareholder can reasonably expect the Company and Management
to;
-- deliver on its obligations and commitments to Principal 1.
-- ensure its management and directors act with integrity and
professionalism in running the company
-- direct the expenditure of monies on appropriate exploration
methods and to ensure expenditure is justified and accountable
-- provide enough flow of information on exploration progress to
allow the shareholder to make informed decisions on their
investment
-- publish clear and concise announcements, with minimal technical complexity
-- have open access to the Board or CEO to provide clarification
We seek to engage with our shareholders through updates to the
market via regulatory news flow ('RNS'), on matters of a material
substance and regulatory nature. Whilst being mindful of the
requirements of the AIM Rules and Market Abuse Regulations the
Board may engage with Shareholders directly from time to time in
relation to questions that they may have and other matters.
The Company's AGM will also provide an opportunity for
shareholders to ask questions during the formal business of the
meeting and informally following the meeting.
The Board shall ensure that the voting decisions of shareholders
at the AGM are reviewed and monitored and that approvals sought at
the Company's AGM will be in line with the recommended corporate
guidelines of the QCA Code.
Shareholder enquiries should be emailed to:
info@rockfireresources.com.
Principle 3 - Take into account wider stakeholder and social
responsibilities and their implications for long- term success
Consider wider stakeholder and social responsibilities and their
implications for long term success.
ENGAGEMENT
The Board believes that engaging with stakeholders strengthens
relationships and helps make better business decisions to deliver
on commitments. The Board is regularly updated on wider stakeholder
engagement feedback to stay abreast of stakeholder insights into
the issues that matter most to them, and to enable the Board to
understand and consider these issues in decision-making. Aside from
Shareholders, suppliers and customers, our workforce is one of the
most important stakeholder groups and the Board therefore closely
monitors their feedback to ensure alignment of interests
WORKFORCE
The Board has established a safe and healthy work environment,
which complies with the relevant Occupational Health and Safety
laws. It has tried to ensure that the workforce is provided with
enough training to develop the appropriate skills and knowledge to
complete the tasks requested of them.
The Company shall;
-- adhere to the relevant laws, rules and regulations within the
jurisdictions in which it operates
-- ensure technical reporting obligations are submitted on time
-- complete environmental management reports for the government
-- comply with site-clearing and rehabilitation guidelines and
expectations on a "best practice" approach
TRADITIONAL LANDOWNERS
The Company shall respect traditional lands, customs and culture
on all land with registered traditional ownership. Heritage
clearance, as required by law shall be sought and honoured. Where
appropriate, traditional landowners shall be consulted with and
included in any opportunities for employment on an equal basis.
LANDOWNERS & PASTORALISTS
The Company shall respect and acknowledge the rights of
landowners and leaseholders. The Company shall work with the
landowner in an ethical manner and where possible, shall offer
opportunity to the landowner to participate in the work
program.
CONTRACTORS & SUPPLIERS
-- For the sake of Occupational Health & Safety, all
contractors and sub-contractors shall be treated in the same manner
as employees.
-- Independent contractors will be required to provide their own
PPE (personal protective equipment) whilst working on any of the
Company sites
-- All Contractors shall be subject to a Site Induction on their
first visit to any of the sites being explored by the Company.
-- All independent contractors will be required to carry their
own Public Liability and Workers Compensation Insurances.
-- To ensure a safe and productive work environment, the
appropriate Occupational Health & Safety requirements,
induction procedures and safety precautions shall be established by
the Company.
The Company has designated an appropriately experienced and
qualified representative to act as a "Liaison Officer" between
contractors and the Company.
Principle 4 - Embed effective risk management, considering both
opportunities and threats, throughout the organisation
The risks facing the Company are detailed in the risk management
section of the Strategic Report. The Board seeks to mitigate such
risks so far as it is able to do, but certain important risks
cannot be controlled by the Board.
In setting and implementing the Company's strategies, the Board,
having identified the risks, seeks to limit the extent of the
Company's exposure to them having regard to both its risk tolerance
and risk appetite.
Principle 5 - Maintain the board as a well-functioning, balanced
team led by the chair
Ian Staunton is considered to be independent. Nicholas Walley
and Patrick Elliott, as significant shareholders, are not
considered to be independent.
The Company is aware that having an Executive Chairman is not in
line with the recommendations made by the QCA. The role of
Executive Chairman has been primarily to ensure that best practice
policies and procedures are implemented through identifying and
appointing the appropriate Directors, ensuring the Board is run in
an effective manner, and assisting the Chief Executive Officer with
legacy matters. There is a clear split of responsibilities between
the Executive Chairman and the Chief Executive Officer. The Board
believes that the skillsets of the Chairman and the non-independent
Non-executive Directors are appropriate and beneficial for all
shareholders and stakeholders.
All Directors are expected to devote the necessary time
commitments required by their position and are expected to attend
all Board meetings. The Board convenes outside these meetings on an
ad hoc basis as and when it deems necessary.
The Chief Executive Officer works full time for the Company. The
Executive Chairman is expected to devote sufficient time as to
fulfil the needs of the Company, The Non-executive Directors are
expected to dedicate up to 3 days per month to the Company's
affairs. The Board is satisfied that each of the Directors is able
to allocate sufficient time to the Company to discharge their
responsibilities effectively.
The number of meetings of the Board and attendance for the year
ended 31 December 2022 are set out below:
Meetings held Meetings attended
Gordon Hart 14 14
Patrick Elliott 14 9
Ian Staunton 14 12
Nicholas Walley 14 14
David Price 14 14
Principle 6 - Ensure that between them the directors have the
necessary up-to-date experience, skills and capabilities
The Board comprises the Executive Chairman, Gordon Hart; the
Chief Executive Officer, David Price; and three Non-executive
Directors, Ian Staunton, Patrick Elliott and Nicholas Walley.
Further details on the Board can be found on the Director
biographies section of the 2022 Annual Report, which details the
relevant experience, skills and personal qualities and capabilities
that each director brings to the board.
The Board is therefore satisfied that it has a suitable balance
between independence on the one hand, and direct managerial and
operational knowledge of the Company on the other, which ensures
that no individual or group may dominate the Board's decisions. The
Board is also satisfied that the Board has sufficient knowledge of
the Group and its operations to enable it to discharge its duties
and responsibilities effectively. All Directors use their
independent judgement to challenge all matters, whether strategic
or operational.
The Directors endeavour to ensure that their knowledge of best
practices and regulatory developments is up to date by technical
reading and attending relevant seminars and conferences as
considered necessary. All Directors receive regular updates on
legal and governance issues. Nicholas Walley has been attending
various QCA seminars on remuneration. David Price has attended
various technical seminars. Gordon Hart has attended numerous
webinars and conferences held by the Australian Institute of
Company Directors. All Directors are encouraged to attend
presentations, conferences and webinars which improve their skill
base.
Rockfire has a Company Secretary whose role is to work closely
with the Chairman to maintain high standards of corporate
governance, ensuring that the necessary information is supplied to
the Directors on a timely basis and that the Company complies with
all applicable rules, regulations and obligations governing its
operation.
The Board has regular contact with its advisors to ensure that
it is aware of changes to generally accepted corporate governance
procedures and requirements and that the Group remains compliant
with applicable rules and regulations. The Company's nominated
advisor supports the Board's development, specifically providing
guidance on corporate governance and other regulatory matters, as
required.
Each Director can take independent professional advice in the
furtherance of his duties, if necessary, at the Company's expense.
In addition, the Directors have direct access to the advice and
services of the Company Secretary.
Neither the Board nor its committees have sought external advice
on a significant matter during this period.
Principle 7 - Evaluate board performance based on clear and
relevant objectives, seeking continuous improvement
Given the current stage of the Company's development the
Directors believe that the Board operates efficiently and cost
effectively and that the cost of an internal or external review
process is not justified. Nevertheless, it is intended that the
Board will be strengthened in due course to reflect the Group's
progress with exploration and growth.
No board performance evaluation has taken place in the year for
the reason described above.
Principle 8 - Promote a corporate culture that is based on
ethical values and behaviours
The Board recognises that its decisions regarding strategy and
risk will impact the corporate culture of the Group as a whole and
that this will impact the performance of the Group. The Board is
aware that the tone and culture set by the Board will greatly
impact all aspects of the Group and the way that employees and
other stakeholders behave. The Corporate Governance arrangements
that the Board has adopted are designed to ensure that the Company
delivers long term value to its shareholders, and that shareholders
have the opportunity to express their views in a manner that
encourages open dialogue with the Board. Therefore, the importance
of sound ethical values and behaviours is crucial to the ability of
the Company to successfully achieve its corporate objectives.
A large part of the Company's activities is centred upon an open
and respectful dialogue with employees, contractors, clients and
other stakeholders. The Board places great importance on this
aspect of corporate life and seeks to ensure that transparency and
openness are evident in all that the Company does. The Directors
consider that at present the Company has an open culture
facilitating comprehensive dialogue and feedback and enabling
positive and constructive challenge.
The Board has adopted a code of conduct which provides a
framework for ethical decision-making and actions across the Group.
The code of conduct reiterates the Group's commitment to integrity
and fair dealing in its business affairs and its duty of care to
all employees, contractors and stakeholders.
Each Board member's adherence to the Group's code of conduct is
assessed annually. Employees are assessed on their performance and
their adherence to the code of conduct through their annual
performance review.
Principle 9 - Maintain governance structures and processes that
are fit for purpose and support good decision-making by the
board
BOARD PROGRAMME
The Board is responsible for approving the Company strategy and
policies, for safeguarding the assets of the Company, and is the
ultimate decision-making body of the Company in all matters except
those that are reserved for specific shareholder approval.
The Board sets direction for the Company through a formal
schedule of matters reserved for its decision.
The Board meets at least four times each year in accordance with
its scheduled meeting calendar and maintains regular dialogue
between Board members.
Prior to the start of each financial year, a schedule of dates
for that year's Board meetings is compiled. This may be
supplemented by additional meetings as and when required.
The Board and its Committees receive appropriate and timely
information prior to each meeting, with a formal agenda being
produced for each meeting, and Board and Committee papers
distributed several days before meetings take place.
Any Director may challenge Company proposals and decisions are
taken democratically after discussion. Any Director who feels that
any concern remains unresolved after discussion may ask for that
concern to be noted in the minutes of the meeting, which are then
circulated to all Directors. Any specific actions arising from such
meetings are agreed by the Board or relevant Committee and then
followed up by the Company's executive management team.
ROLES & RESPONSIBILITIES
There is a clear division of responsibility at the head of the
Company.
The Chairman is responsible for:
-- running the business of the Board;
-- setting the agenda for Board meetings;
-- ensuring appropriate strategic focus and direction;
-- facilitating effective contribution from all Directors; and
-- promoting constructive and respectful relations between the Board and management.
The CHIEF EXECUTIVE OFFICER is responsible for:
-- proposing the strategic focus to the Board;
-- implementing strategy once it has been approved by the Board;
-- overseeing the management of the Company through the executive management team; and
-- where proposed transactions, commitments or arrangements
exceed the thresholds set by the Board to refer the matter to the
Board for its consideration, review and approval.
The Board is supported by the Audit and Remuneration committees.
Each committee has access to such resources, information and advice
as it deems necessary, at the cost of the Company, to enable the
committee to discharge its duties.
The Audit Committee's primary function is to assist the Board in
fulfilling its responsibilities by reviewing the:
-- Quality and integrity of financial reporting.
-- Systems of internal control which management and the Board
have established to safeguard the Group's financial and physical
assets and facilitate compliance with relevant statutory and
regulatory requirements.
-- Processes for business risk identification, quantification and mitigation.
-- Effectiveness and independence of the external audit process.
-- Quality and relevance of financial and non-financial
information provided to management and the Board on which decisions
will be based.
The Audit Committee acts as the Board's committee to oversee
risk.
The Remuneration Committee acts as the Board's committee to
oversee employment and remuneration contracts for management and
directors.
The roles of the Audit and Remuneration Committees are available
on the website at www.rockfireresources.com
All matters that have a material impact upon the Company or any
of its subsidiaries will be referred to the Board. However, below
is a schedule of matters reserved specifically for the decision of
the Board or a duly authorized committee thereof. The Board has the
authority to obtain outside legal or other independent advice at
the expense of the Company.
Financial matters
-- Approval of full year (preliminary) and half year results announcements.
-- Adoption of significant change in accounting policies or practices.
-- Approval of all circulars and prospectus to shareholders.
-- Changes relating to the capital structure of the company.
-- Approval of increases in share capital of any Group Company.
-- The approval of all guarantees given by the Company.
-- Ratify the use of Rockfire Resources plc company seal.
Corporate matters
-- Convening general meetings of the Company.
-- Recommending to shareholders the approval of alterations to
the Memorandum and Articles of Association of the company.
-- Making any take-over offer for another company or other
companies within the City Code on Takeovers and Mergers and
considering a response to any such approaches to the Company.
-- Annual report and accounts
To issue the Annual Report and Accounts of the company having
approved the following:
-- Strategic Report.
-- Directors Report.
-- Remuneration, Audit and Nomination Committee Reports
-- Accounts and notes to the accounts.
Appointments and structure
-- Appointment and removal of the Chairman.
-- Appointment, removal and re-election of the Directors.
-- Appointment and removal of the Company Secretary.
-- Reviewing succession planning for the Board and senior management of the Group.
-- Carry out a formal and rigorous review of its own performance
and that of its committees and individual directors on an annual
basis.
Budgets, contracts and business development
-- Approval of strategic plans of the company.
-- Approval of the annual budget of the company.
-- Approval of significant changes in treasury and foreign currency policy of the company.
-- Approval of material contracts.
-- Significant changes to the company's activities to include,
acquisitions or divestments or entry into a new foreign
jurisdiction or exit from an existing one.
-- Internal controls
To receive reports directly from the Chief Executive Officer on
the Group's internal control systems and to consider amongst
others:
-- Changes in the nature and extent of significant risks to the business.
-- The key risks and how these are evaluated and managed.
To review annually the effectiveness of the company's internal
control systems and consider:
-- For identified weaknesses, the actions being taken and the timeliness of rectification.
-- The effectiveness and output of the management's review process.
-- Incidence of major control weaknesses, their cause and potential impact on the business.
-- To report to shareholders on the review of the internal control systems.
Board committees
-- Approving terms of reference for Board Committees and
agreeing division of responsibility between Chairman and Chief
executive Officer.
-- Recommendation to shareholders to appoint or remove the
Company's auditors including approval of their fees.
-- Appointment or removal of the Company's principal advisors.
-- Approval of major changes in employee share and incentive schemes.
-- Approval of the Group's Health and Safety Policy.
-- Approval of the Group's Environmental Policy.
-- Monitoring of the Directors and Officers Liability Insurance.
-- Agreeing fee levels for Non-Executive Directors.
As the Group grows and develops the Board will periodically
review its corporate governance framework to ensure it remains
appropriate for the size, complexity and risk profile of the
Group
Principle 10 - Communicate how the company is governed and is
performing by maintaining a dialogue with shareholders and other
relevant stakeholders
The Board attaches great importance to providing shareholders
with clear and transparent information on the Company's activities,
strategy and financial position.
The Company communicates with shareholders through the Annual
Report, full-year and half-year announcements, the Annual General
Meeting and one-to-one meetings with large existing or potential
new shareholders.
The Company announces significant developments which are
disseminated via various outlets including the London Stock
Exchange's Regulatory News Service (RNS).
The audit committee is chaired by Ian Staunton and includes
Patrick Elliott and Gordon Hart, and their biographies can be found
on page 7. The role of the committee is to consider and approve the
interim results, and with the auditors to consider the annual
report and matters raised by the auditors based on their audit. So
far as possible recommendations by the auditors are immediately
implemented. To date, audit committee matters have been discussed
in full Board meetings. As such no formal audit committee reports
have been required.
The remuneration committee is chaired by Nicholas Walley and
includes Patrick Elliott, and their biographies can be found on
page 7. The remuneration committee meets on an ad hoc basis, when
required. Fees payable to the Non-executive Directors are
determined by the Executive Directors.
Additional information supplied by the remuneration committee
has been disseminated across this Annual Report, rather than
included as a separate committee report.
Gordon Hart, Chairman
6 June 2023
INDEPENT AUDITOR'S REPORT
Opinion
We have audited the financial statements of Rockfire Resources
Plc (the 'parent company') and its subsidiaries (the 'group') for
the year ended 31 December 2022 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated and Parent
Company Statements of Financial Position, the Consolidated and
Parent Company Statements of Changes in Equity, the Consolidated
and Parent Company Statements of Cash Flows and notes to the
financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their
preparation is applicable law and UK-adopted international
accounting standards and as regards the parent company financial
statements, as applied in accordance with the provisions of the
Companies Act 2006.
In our opinion:
-- the financial statements give a true and fair view of the
state of the group's and of the parent company's affairs as at 31
December 2022 and of the group's loss for the year then ended;
-- the group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
-- the parent company financial statements have been properly
prepared in accordance with UK-adopted international accounting
standards and as applied in accordance with the provisions of the
Companies Act 2006; and
-- the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the group
and parent company in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the UK,
including the FRC's Ethical Standard as applied to listed entities,
and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 3 in the financial statements, which
indicates that the group will require further funds to be raised
over the next 12 months in order for the group to meet its
exploration expenditure commitments and to undertake the budgeted
exploration activities. As stated in note 3, these events or
conditions indicate that a material uncertainty exists that may
cast significant doubt on the group's ability to continue as a
going concern. Our opinion is not modified in respect of this
matter.
In auditing the financial statements, we have concluded that the
director's use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the directors' assessment of the group's and parent
company's ability to continue to adopt the going concern basis of
accounting included a review of the cash flow forecasts prepared by
management, a review of management's assessment of going concern
and post year end information impacting going concern.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Our application of materiality
Materiality Basis for materiality
Group GBP102,000 (2021: GBP97,000) 2% of gross assets
Company GBP75,000 (2021: GBP75,000) Combination of 2% of gross assets and 5% of loss before tax
=============================================================
We consider gross assets to be the most significant determinant
of the group's financial position and performance used by
shareholders, with the key financial statement balances being
intangible exploration and evaluation assets and cash and cash
equivalents. The going concern of the group is dependent on its
ability to fund operations going forward, as well as on the
valuation of its assets, which represent the underlying value of
the group. The basis for calculating materiality was unchanged from
the prior year. The benchmark for the parent company differs from
the group in order to achieve sufficient coverage of expenditure in
our testing.
Whilst materiality for the group financial statements as a whole
was set at GBP102,000, materiality for the parent company was
GBP75,000 and for significant components was set at a range between
GBP71,000 and GBP63,350 (2021: GBP75,000 and GBP58,000).
Performance materiality at 70% was set at GBP71,400 for the group,
GBP52,500 for the parent company and for the significant components
at a range between 49,700 and GBP44,350 (2021: GBP67,900, GBP52,500
and GBP40,600 respectively). We applied the concept of materiality
both in planning and performing our audit, and in evaluating the
effect of misstatements.
We agreed with the audit committee that we would report to the
committee all audit differences identified during the course of our
audit in excess of GBP5,100 (2021: GBP4,850) for the group and
GBP3,750 (2021: GBP3,750) for the parent company.
Our approach to the audit
In designing our audit, we determined materiality and assessed
the risk of material misstatement in the financial statements. In
particular, we looked at areas requiring the directors to make
subjective judgements, for example in respect of assessing the
recoverability of exploration, evaluation and development
expenditure, the valuation of share-based payments, the carrying
value and recoverability of investments in subsidiaries at parent
company level, and the consideration of future events that are
inherently uncertain. We also addressed the risk of management
override of internal controls, including evaluating whether there
was evidence of bias by the directors that represented a risk of
material misstatement due to fraud.
An audit was performed on the financial information of the
group's significant operating components which, for the year ended
31 December 2022, were located in the United Kingdom, Australia and
Greece. The audit of significant components was performed in London
solely by PKF Littlejohn LLP using a team with experience of
auditing mineral exploration and publicly listed entities.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters. In addition to
the matters described in the Material uncertainty related to
concern section we have determined the matters described below to
be the key audit matters to be communicated in our report.
Key Audit Matter How our scope addressed this matter
Carrying value and appropriate
capitalisation of Intangible Assets
(refer Note 9) (GROUP)
=============================================================
The group carrying value of intangible Our work in this area included:
assets in relation to capitalised
exploration costs for its Australian * Confirmation that the group has good title to the
and Greek projects is material. applicable exploration licences, and has fulfilled
There is a risk that these assets any specific conditions therein particularly having
have been incorrectly capitalised regard to minimum expenditure requirements;
in accordance with the requirements
of IFRS 6 and that there are indicators
of impairment as at 31 December * Review and substantive testing of capitalised costs,
2022. including the fair value arising on the asset
acquisition in the year, and consideration of
Particularly for early stage exploration appropriateness for capitalisation under IFRS 6;
projects, where the calculation
of recoverable amount via value
in use calculations is not possible, * Assessment of progress at the individual projects
management's assessment of impairment during the year and post year-end;
under IFRS 6 requires significant
estimation and judgement.
* Consideration of management's impairment reviews in
light of impairment indicators identified in
accordance with IFRS 6, including corroboration and
challenge thereof; and
* Evaluating the disclosures included within the
financial statements.
=============================================================
Recoverability of investments
and intragroup balances (refer
Notes 11 and 12) (COMPANY)
=============================================================
Investments in subsidiaries and Our work in this area included:
intragroup loans are significant * Confirmation of ownership of the investments;
assets in the parent company's
financial statements. Their recoverability
is directly linked to the recoverability * Review of management's calculations of expected
of intangible assets in those entities, credit losses on the intragroup balances to ensure
and hence may not be fully recoverable. the rationale and accounting treatment is in
accordance with IFRS 9;
* Consideration of recoverability of investments and
intragroup loans by reference to underlying net asset
values and exploration projects; and
* Evaluating the disclosures included within the
financial statements.
=============================================================
Other information
The other information comprises the information included in the
annual report, other than the financial statements and our
auditor's report thereon. The directors are responsible for the
other information contained within the annual report. Our opinion
on the group and parent company financial statements does not cover
the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon. Our responsibility is to read the
other information and, in doing so, consider whether the other
information is materially inconsistent with the financial
statements or our knowledge obtained in the course of the audit, or
otherwise appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material
misstatement in the financial statements themselves. If, based on
the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report
that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act
2006
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the strategic report and the
directors' report for the financial year for which the financial
statements are prepared is consistent with the financial
statements; and
-- the strategic report and the directors' report have been
prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and
the parent company and their environment obtained in the course of
the audit, we have not identified material misstatements in the
strategic report or the directors' report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
-- adequate accounting records have not been kept by the parent
company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the parent company financial statements are not in agreement
with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities
statement, the directors are responsible for the preparation of the
group and parent company financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements,
the directors are responsible for assessing the group's and the
parent company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors
either intend to liquidate the group or the parent company or to
cease operations, or have no realistic alternative but to do
so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below:
-- We obtained an understanding of the group and parent company
and the sector in which they operate to identify laws and
regulations that could reasonably be expected to have a direct
effect on the financial statements. We obtained our understanding
in this regard through discussions with management and application
of our cumulative audit knowledge and experience of the industry.
We ensured that the audit team collectively had the appropriate
experience with auditing entities within this industry, facing
similar audit and business risks, and of a similar size.
-- We determined the principal laws and regulations relevant to
the group and parent company in this regard to be those arising
from:
o AIM Rules;
o UK employment law; and
o Local tax laws and regulations.
-- We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by
the group and parent company with those laws and regulations. These
procedures included, but were not limited to:
o Making enquiries of management;
o A review of Board minutes;
o A review of legal ledger accounts; and
o A review of RNS announcements.
-- We addressed the risk of fraud arising from management
override of controls by performing audit procedures which included,
but were not limited to: the testing of journals, reviewing
accounting estimates for evidence of bias; and evaluating the
business rationale of any significant transactions that are unusual
or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk
that we will not detect all irregularities, including those leading
to a material misstatement in the financial statements or
non-compliance with regulation. This risk increases the more that
compliance with a law or regulation is removed from the events and
transactions reflected in the financial statements, as we will be
less likely to become aware of instances of non-compliance. The
risk is also greater regarding irregularities occurring due to
fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor's report.
Use of our report
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them in
an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone, other than the company and the company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
David Thompson (Senior Statutory Auditor) 15 Westferry
Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor London E14 4HD
6 June 2023
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31
DECEMBER 2022
Note 2022 2021
GBP GBP
Interest income 1 -
Impairment of intangible assets - (12,334)
Administrative expenses (753,213) (732,619)
---------- ----------
Operating loss 6 (753,212) (744,953)
Loss before taxation (753,212) (744,953)
Taxation 7 - -
Loss for the
year
attributable
to
shareholders
of the
Company (753,212) (744,953)
Items that may be reclassified subsequently
to profit or loss:
Foreign exchange translation movement 138,883 (162,830)
---------- ----------
Total comprehensive loss attributable
to shareholders of the Company (614,329) (907,783)
========== ==========
Loss per share attributable to shareholders
of the Company
Basic and diluted 8 (0.06)p (0.08)p
The notes form part of these financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION FOR THE YEARED 31
DECEMBER 2022
Note 2022 2021
GBP GBP
Assets
Non-current assets
Intangible assets 9 4,451,118 3,447,739
Property, plant and equipment 10 38,323 20,189
Other receivables 12 85,872 -
------------- -------------
4,575,313 3,467,928
------------- -------------
Current assets
Cash and cash equivalents 420,255 1,473,599
Trade and other receivables 12 106,171 124,261
------------- -------------
526,426 1,597,860
------------- -------------
Total assets 5,101,739 5,065,788
============= =============
Equity and liabilities
Equity attributable to shareholders
of the Company
Share capital 13 7,435,409 7,078,136
Share premium 14 18,233,976 18,180,659
Other reserves 14 2,295,035 2,295,035
Merger relief reserve 14 190,000 -
Foreign exchange reserve 14 (51,123) (190,006)
Retained deficit (23,161,632) (22,408,420)
------------- -------------
Total equity 4,941,665 4,955,404
------------- -------------
Current liabilities
Trade and other payables 16 160,074 110,384
------------- -------------
Total liabilities 160,074 110,384
------------- -------------
Total equity and liabilities 5,101,739 5,065,788
============= =============
The notes form part of these financial statements.
COMPANY STATEMENT OF FINANCIAL POSITION FOR THE YEARED 31
DECEMBER 2022
2022 2021
GBP GBP
Assets Note
Non-current assets
Intangible assets 9 - 13,380
Property, plant & equipment 10 109 690
Investments 11 1,030,640 648,000
Total non-current assets 1,030,749 662,070
------------- -------------
Current assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 12 4,605,819 3,573,333
Total current assets 4,642,824 4,994,134
------------- -------------
Total assets 5,673,573 5,656,204
============= =============
Equity
Equity attributable to owners
of the parent:
Share capital 13 7,435,409 7,078,136
Share premium 14 18,233,976 18,180,659
Other reserves 14 1,801,872 1,801,872
Merger relief reserve 14 190,000 -
Accumulated losses 14 (22,077,982) (21,489,448)
Total equity 5,583,275 5,571,219
------------- -------------
LIABILITIES
Current liabilities
Trade and other payables 16 90,299 84,985
Total liabilities 90,299 84,985
------------- -------------
Total equity and liabilities 5,673,574 5,656,204
============= =============
As permitted by section 408 of the Companies Act 2006, the
Company has not presented its own income statement. The Company's
total comprehensive loss for the year was GBP588,534 (2021: loss of
GBP717,442).
The financial statements were approved and authorised for issue
by the Board on 6 June 2023 and signed on its behalf by:
David Price, Chief Executive Officer
The notes form part of these financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
DECEMBER 2022
Share Share Other Merger Foreign Retained Total
capital premium reserves relief exchange deficit equity
reserves reserve
GBP GBP GBP GBP GBP GBP GBP
As at 1 January 2021 6,828,085 16,658,354 2,295,035 - (27,176) (21,779,516) 3,974,782
---------- ----------- ---------- ---------- ---------- ------------- ----------
Loss for the financial year - - - - - (744,953) (744,953)
Foreign exchange translation
movement - - - - (162,830) - (162,830)
---------- ----------- ---------- ---------- ---------- ------------- ----------
Total comprehensive loss - - - - (162,830) (744,953) (907,783)
---------- ----------- ---------- ---------- ---------- ------------- ----------
Shares issued during the year 250,051 1,630,995 - - - - 1,881,046
Share issuance costs - (108,690) - - - - (108,690)
Share-based expense - - - - - 116,049 116,049
---------- ----------- ---------- ---------- ---------- ------------- ----------
Total transactions with
shareholders 250,051 1,522,305 - - - 116,049 1,888,405
---------- ----------- ---------- ---------- ---------- ------------- ----------
At 31 December 2021 7,078,136 18,180,659 2,295,035 - (190,006) (22,408,420) 4,955,404
========== =========== ========== ========== ========== ============= ==========
As at 1 January 2022 7,078,136 18,180,659 2,295,035 - (190,006) (22,408,420) 4,955,404
---------- ----------- ---------- ---------- ---------- ------------- ----------
Loss for the financial year - - - - - (753,212) (753,212)
Foreign exchange translation
movement - - - - 138,883 - 138,883
Total comprehensive loss - - - - 138,883 (753,212) (614,329)
---------- ----------- ---------- ---------- ---------- ------------- ----------
Shares issued during the year 307,273 95,727 - - - - 403,000
Share issuance costs - (42,410) - - - - (42,410)
Acquisition of subsidiary 50,000 - - 190,000 - - 240,000
---------- ----------- ---------- ---------- ---------- ------------- ----------
Total transactions with
shareholders 357,273 53,317 - 190,000 - - 600,590
---------- ----------- ---------- ---------- ---------- ------------- ----------
At 31 December 2022 7,435,409 18,233,976 2,295,035 190,000 (51,123) (23,161,632) 4,941,665
========== =========== ========== ========== ========== ============= ==========
The notes form part of these financial statements.
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31
DECEMBER 2022
Share capital Share Other Merger Retained Total
premium reserves relief deficit equity
reserves
GBP GBP GBP GBP GBP GBP
At 1 January 2021 6,828,085 16,658,354 1,801,872 - (20,888,055) 4,400,256
-------------- ----------- ---------- ---------- ------------- ----------
Loss for the financial year - - - - (717,442) (717,442)
-------------- ----------- ---------- ---------- ------------- ----------
Total comprehensive loss - - - - (717,442) (717,442)
-------------- ----------- ---------- ---------- ------------- ----------
Issue of share capital 250,051 1,630,995 - - - 1,881,046
Share issuance costs - (108,690) - - - (108,690)
Share-based payments - - - - 116,049 116,049
-------------- ----------- ---------- ---------- ------------- ----------
Total transactions with shareholders 250,051 1,522,305 - - 116,049 1,888,405
-------------- ----------- ---------- ---------- ------------- ----------
At 31 December 2021 7,078,136 18,180,659 1,801,872 - (21,489,448) 5,571,219
-------------- ----------- ---------- ---------- ------------- ----------
Loss for the financial year - - - - (588,534) (588,534)
-------------- ----------- ---------- ---------- ------------- ----------
Total comprehensive loss - - - - (588,534) (588,534)
-------------- ----------- ---------- ---------- ------------- ----------
-
Issue of share capital 307,273 95,727 - - - 403,000
Share issuance costs - (42,410) - - - (42,410)
Acquisition of subsidiary 50,000 - - 190,000 - 240,000
Total transactions with shareholders 357,273 53,317 - 190,000 - 600,590
-------------- ----------- ---------- ---------- ------------- ----------
At 31 December 2022 7,435,409 18,233,976 1,801,872 190,000 (22,077,982) 5,583,275
-------------- ----------- ---------- ---------- ------------- ----------
The notes form part of these financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEARED 31 DECEMBER
2022
2022 2021
GBP GBP
Cash flow from operating activities
Loss for the year before tax (753,212) (744,953)
Impairment of intangible assets - 12,334
Depreciation 8,677 7,052
Expenses settled in shares 28,000 31,041
Share-based expense - 116,049
Finance cost 1,477 -
Foreign exchange differences (105,327) (47,912)
Decrease / (Increase) in trade
and other receivables 20,617 (61,748)
Decrease in trade and other
payables (96,804) (9,148)
------------ ----------
Net cash outflow from operating
activities (896,572) (697,285)
------------ ----------
Cash flow from investing activities
Exploration expenditure (459,292) (918,667)
Payment of long term deposit (85,872) -
Cash acquired with subsidiary 82,282 -
Acquisition of property, plant
and equipment (25,003) (2,690)
------------ ----------
Net cash used in investing
activities (487,885) (921,357)
------------ ----------
Cash flow from financing activities
Proceeds from issuance of ordinary
shares 375,000 1,850,005
Share issuance costs (42,410) (108,690)
Interest paid (1,477) -
------------ ----------
Net cash generated from financing
activities 331,113 1,741,315
------------ ----------
Net (decrease) / increase in
cash and cash equivalents (1,053,344) 122,673
Cash and cash equivalents at
the beginning of the year 1,473,599 1,350,926
------------ ----------
Cash and cash equivalents at
the end of the year 420,255 1,473,599
============ ==========
The notes form part of these financial statements.
COMPANY STATEMENT OF CASH FLOWS FOR THE YEARED 31 DECEMBER
2022
2022 2021
GBP GBP
Cash flow from operating activities
Loss for the year before tax (588,534) (717,442)
Expenses settled in shares 28,000 31,041
Depreciation 580 460
Share-based expense - 116,049
Expected credit losses 86,022 168,482
Decrease in trade and other receivables 35,485 957,221
Increase in trade and other payables 5,313 34,400
------------ ------------
Net cash outflow from operating
activities (433,134) 590,211
------------ ------------
Cash Flow from investing activities
Exploration expenditure - (13,380)
Acquisition of property, plant
and equipment - (1,149)
Investment in subsidiary (142,639) -
------------ ------------
Net cash used in investing activities (142,639) (14,529)
------------ ------------
Cash flow from financing activities
Related party loans (1,140,613) (2,132,370)
Proceeds from issuance of ordinary
shares 375,000 1,850,005
Share issuance costs (42,410) (108,690)
------------ ------------
Net cash generated from financing
activities (808,023) (391,055)
------------ ------------
Net increase in cash and cash
equivalents (1,383,796) 184,627
Cash and cash equivalents at the
beginning of the year 1,420,801 1,236,174
------------ ------------
Cash and cash equivalents at
the end of the year 37,005 1,420,801
------------ ------------
The notes form part of these financial statements.
.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARED 31
DECEMBER 2022
1 Reporting entity
Rockfire Resources plc is a public limited company, quoted on
AIM and incorporated in England and Wales.
2 Adoption of new and revised standards
(i) New and amended standards, and interpretations issued and
effective for the financial year beginning 1 January 2022
The following new standards, amendments and interpretations are
effective for the first time in these financial statements.
However, none has had a material impact on the financial
statements:
Standard Effective
date
Amendments to IFRS 3: Business Combinations - Reference 1 January
to the Conceptual Framework; 2022
Amendment to IAS 16: Property, Plant and Equipment 1 January
2022
Amendments to IAS 37: Provisions, Contingent Liabilities 1 January
and Contingent Assets 2022
Annual Improvements to IFRS Standards 2018-2020 1 January
Cycle 2022
(ii) New standards, amendments and interpretations in issued but
not yet effective
At the date of approval of these financial statements, the
following standards and interpretations which have not been applied
in these financial statements were in issue but not yet effective:
(and in some cases not yet adopted by the UK):
Standard Effective
date
Amendments to IAS 1 Presentation of Financial Statements: 1 January
Classification of Liabilities as Current or Non-current 2023
Amendments to IAS 8: Accounting Policies, Changes 1 January
in Accounting Estimates and Errors - Definition 2023
of Accounting Estimates;
Deferred Tax relating to Assets and Liabilities 1 January
arising from a Single Transaction (Amendments to 2023
IAS 12);
Amendment to IFRS 16 Leases: Lease Liability in 1 January
a sale & leaseback*. 2023
* Subject to UK endorsement
The Directors do not expect that the adoption of these standards
will have a material impact on the financial statements of the
Group or Company in future periods.
3 Basis of preparation and significant accounting policies
a) Basis of preparation
These financial statements have been prepared in accordance with
UK-adopted international accounting standards and with the
requirements of the Companies Act 2006. The Financial statements
are prepared under the historical cost convention as modified by
the measurement of certain financial instruments at fair value.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the Group's and Company's accounting policies.
b) Basis of consolidation
Subsidiaries are entities controlled by the Group. Control is
achieved when the Group is exposed, or has rights, to variable
returns from its involvement with the investee and has the ability
to affect those returns through its power over the investee.
Specifically, the Group controls an investee if, and only if, the
Group has:
-- Power over the investee (i.e., existing rights that give it
the current ability to direct the relevant activities of the
investee);
-- Exposure, or rights, to variable returns from its involvement with the investee; and
-- The ability to use its power over the investee to affect its returns.
Generally, when the Group has less than a majority of the voting
or similar rights of an investee, the Group considers all relevant
facts and circumstances in assessing whether it has power over an
investee, including:
-- The contractual arrangement(s) with the other vote holders of the investee;
-- Rights arising from other contractual arrangements; and
-- The Group's voting rights and potential voting rights.
The Group re-assesses whether or not it controls an investee if
facts and circumstances indicate that there are changes to one or
more of the three elements of control. Subsidiaries are fully
consolidated from the date that control commences until the date
that control ceases. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with the policies
adopted by the Group. Intra-group balances and any unrealised gains
or losses or income or expenses arising from intra-group
transactions are eliminated in preparing the Group financial
statements.
c) Functional and presentation currency
These consolidated financial statements are presented in GB
pounds sterling (GBP), which is the Company's functional
currency.
d) Going concern
The Company has prepared a cash flow forecast to 30 June 2024
which supports the Directors' expectation that the Group has
adequate resources to continue in operational existence for a
period of not less than 12 months from the date of signing these
financial statements. This cash flow forecast assumes that the
exploration programmes, including minimum expenditure commitments,
will only continue with additional equity funding secured by the
Group. This additional funding is not guaranteed, however, to date
the Group has been successful in securing funding when required. On
17 October 2022, the Company announced that it had successfully
completed a placing of new ordinary shares in the Company, raising
gross proceeds of GBP375,000 , which comprised 240,000,000 new
ordinary shares of 0.1 pence each in the Company being placed with
an institutional investor at an issue price of 0.125 pence per
share. In addition, certain Rockfire employees, including several
Directors subscribed for an aggregate of 60,000,000 new ordinary
shares at the same issue price. In total, 300,000,000 new ordinary
shares were issued pursuant to the placing. On 1 June 2023, the
Company announced that it had raised GBP880,000, before expenses,
through a placing of 400,000,000 new ordinary shares of 0.1pence
each at a price of 0.22 pence per share. As such, the financial
statements have been prepared assuming the Group and Company will
continue as a going concern.
The Directors believe the Group will generate sufficient working
capital and cash flows to continue in operational existence and
will have the ongoing support of its shareholders, if required, for
the foreseeable future.
e) Business combinations
The Group applies the acquisition method in accounting for
business combinations. The consideration transferred by the Group
to obtain control of a subsidiary is calculated as the sum of the
acquisition-date fair values of assets transferred, liabilities
incurred, and the equity interests issued by the Group, which
includes the fair value of any asset or liability arising from a
contingent consideration arrangement. Acquisition costs are
expensed as incurred. Assets acquired and liabilities assumed are
generally measured at their acquisition-date fair value.
f) Property, plant and equipment
Items of property, plant and equipment are stated at historical
cost less accumulated depreciation.
Depreciation is provided at the following annual rates in order
to write off each asset over its estimated useful life.
-- Motor vehicles - 20% straight line
-- Office equipment - 25% straight line
-- Building improvements - 10% straight line
The assets' residual values and useful lives are reviewed, and
adjusted if appropriate, at each balance sheet date.
g) Intangible assets - exploration costs
Exploration costs comprise costs associated with the acquisition
of mineral rights and mineral exploration and are capitalised as
intangible assets pending the feasibility of the project. They also
include certain administrative costs that are allocated to the
extent that those costs can be related directly to exploration
activities.
If an exploration project is deemed successful based on
feasibility studies, the related expenditure is transferred to
development and production assets and amortised over the estimated
useful life of the ore reserves on a unit of production basis.
Where a project is abandoned or considered to be no longer
economically viable, the related costs are written off to profit or
loss.
To date, the Group has not progressed to the development and
production stage in any area of operation.
h) Impairment of non-financial assets
The Group assesses at each reporting date whether there is an
indication that an asset may be impaired. If any such indication
exists, or when annual impairment testing for an asset is required,
the Group estimates the asset's recoverable amount. An asset's
recoverable amount is the higher of an assets or cash-generating
unit's fair value less costs to sell and its value in use and is
determined for an individual asset, unless the asset does not
generate cash inflows that are largely independent from those of
other assets or groups of assets. Where the carrying value of an
asset exceeds its recoverable amount, the asset is considered
impaired and is written down to its recoverable amount. In
assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money
and the risks specific to the asset. In determining fair value less
costs to sell, an appropriate valuation model is used.
Exploration projects at an early stage of development are
assessed under the following areas, in accordance with the criteria
contained within IFRS 6, for circumstances that may indicate the
existence of impairment:
-- The Group's right to explore in an area has expired, or will
expire in the near future without renewal;
-- No further exploration or evaluation is planned or budgeted;
-- A decision has been taken by the Board to discontinue
exploration and evaluation in an area due to the absence of a
commercial level of reserves; or
-- Sufficient data exists to indicate that the book value will
not be fully recovered from future development.
Impairment losses of continuing operations are recognised in
profit or loss in those expense categories consistent with the
function of the impaired asset. For impaired assets, an assessment
is made at each reporting date as to whether there is any
indication that previously recognised impairment losses may no
longer exist or may have decreased. If such indication exists, the
Group makes a revised estimate of recoverable amount. A previously
recognised impairment loss is reversed only if there has been a
change in the estimates used to determine the asset's recoverable
amount since the last impairment loss was recognised. If that is
the case the carrying amount of the asset is increased to its
recoverable amount. That increased amount cannot exceed the
carrying amount that would have been determined, net of
depreciation, had no impairment loss been recognised for the asset
in prior years.
i) Financial instruments
Financial assets
Classification
The Group classifies its financial assets at amortised cost.
Financial assets do not comprise prepayments. Management determines
the classification of its financial assets at initial recognition.
The classification of financial assets at initial recognition that
are debt instruments depends on the financial asset's contractual
cash flow characteristics and the business model for managing them.
In order for a financial asset to be classified and measured at
amortised cost it needs to give rise to cash flows that are solely
payments of principal and interest (SPPI) on the principal amount
outstanding.
Amortised cost
The Group's financial assets held at amortised cost comprise
trade and other receivables and cash and cash equivalents in the
statement of financial position. These assets are non-derivative
financial assets with fixed or determinable payments that are not
quoted in an active market. They arise principally through the
provision of goods and services to customers (e.g., trade
receivables), but also incorporate other types of contractual
monetary asset. They are initially recognised at fair value plus
transaction costs that are directly attributable to their
acquisition or issue and are subsequently carried at amortised cost
using the effective interest method, less provision for
impairment.
Impairment of financial assets
An impairment provision is recognised when there is objective
evidence of a default event (e.g., significant financial
difficulties on the part of the counterparty or default or
significant delay in payment) such that the Group may be unable to
collect all of the amounts due under the terms receivable, the
amount of such a provision being the difference between the net
carrying amount and the present value of the future expected cash
flows associated with the impaired asset.
Impairment provisions for trade receivables and other
receivables are recognised based on the simplified approach within
IFRS 9 using lifetime expected credit losses (ECLs). During this
process the probability of non-payment of receivables is assessed.
This probability is then multiplied by the amount of expected loss
arising from the default to determine the ECL.
Financial liabilities
The Group classifies its financial liabilities in the category
of financial liabilities at amortised cost. All financial
liabilities are recognised in the statement of financial position
when the Group becomes a party to the contractual provision of the
instrument. Trade and other payables and borrowings are included in
this category.
Borrowings
Borrowings are recognised initially at fair value, net of
transaction costs incurred. Borrowings are subsequently carried at
amortised cost. Any difference between the proceeds (net of
transaction costs) and the redemption value is recognised in the
statement of comprehensive income over the period of the borrowings
using the effective interest method.
Borrowings are de- recognised from the balance sheet when the
obligation specified in the contract is discharged, is cancelled or
expires. The difference between the carrying amount of a financial
liability that has been extinguished or transferred to another
party and the consideration paid, including any non-cash assets
transferred or liabilities assumed, is recognised in profit or loss
as other operating income or finance costs.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting period.
Trade and other payables
Trade and other payables are initially recognised at fair value
and subsequently measured at amortised cost using the effective
interest method. Accounts payable are classified as current
liabilities if payment is due within one year or less. If not, they
are presented as non-current liabilities.
j) Provisions
A provision is recognised in the balance sheet when the Group
has a present legal or constructive obligation as a result of a
past event, and it is probable that an outflow of economic benefit
will be required to settle the obligation. If the effect is
material, provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects the current
market assessment of the time value of money and where appropriate,
the risks specific to the liability.
k) Current and deferred tax
Tax represents the sum of current and deferred tax.
Tax payable or receivable is based on taxable profit or loss for
the year. Taxable profit or loss differs from accounting profit or
loss as reported in the consolidated statement of comprehensive
income because it excludes items of income or expense that are
taxable or deductible in other years and further excludes items
that are never taxable or deductible. Current tax is measured using
tax rates that have been enacted or substantively enacted by the
reporting 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 future taxable profits will be available, against
which deductible temporary differences can be utilised.
l) Pensions
Pension costs charged in the financial statements represent the
contributions payable by the Group during the year into defined
contribution pension schemes.
m) Foreign currencies
The individual financial statements of each Group entity are
presented in the currency of the primary economic environment in
which the entity operates (its functional currency). For the
purpose of the financial statements, the results and financial
position of each entity are expressed in GBP.
In preparing the financial statements of the individual
entities, 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
balance sheet date, monetary items denominated in foreign
currencies are retranslated at the rates prevailing at the balance
sheet date.
Exchange differences arising on the settlement of monetary items
and on the retranslation of monetary items are included in the
statement of comprehensive income for the period.
For the purpose of presenting consolidated financial statements,
the assets and liabilities of the Group's foreign operations are
expressed in GBP using exchange rates prevailing at the balance
sheet date. Income and expense items are translated at the average
exchange rates for the period. Exchange differences arising, if
any, are classified as other comprehensive income and are
transferred to the Group's translation reserve.
When the settlement of a monetary item receivable from or
payable to a foreign operation is neither planned nor likely in the
foreseeable future, foreign currency gains and losses arising from
such items are considered to form part of a net investment in the
foreign operation and are recognised in other comprehensive income
and presented in the exchange reserve in equity.
n) Investments
Investments held as non-current assets comprise investments in
subsidiary undertakings and are stated at cost less any provision
for impairment.
o) Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of ordinary shares are
recognised as a deduction from equity, net of any tax effects.
p) Share-based payments
The Group makes equity-settled share-based payments to certain
Directors and employees. Equity-settled share-based payments are
measured at fair value at the date of grant by reference to the
fair value of the equity instruments granted.
The fair value determined at the grant date of equity-settled
share-based payments is expensed on a straight-line basis over the
vesting period, based on the Group's estimate of the number of
instruments that will eventually vest with a corresponding
adjustment to equity. Fair value is measured by use of the Black
Scholes model. The expected life used in the model has been
adjusted, based on management's best estimate, for the effect of
non-transferability, exercise restrictions, and behavioural
considerations.
Non-vesting and market vesting conditions are taken into account
when estimating the fair value of the option at grant date. Service
and non-market vesting conditions are taken into account by
adjusting the number of options expected to vest at each reporting
date.
q) Critical accounting estimates and judgements
The Group makes estimates and assumptions concerning the future.
The resulting estimates will, by definition, seldom equal the
actual results. Estimates and judgements are continually evaluated
and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable
under the circumstances. Certain amounts included in the financial
statements involve the use of judgement and/or estimation. These
judgements and estimates are based on management's best knowledge
of the relevant facts and circumstances, but actual results may
differ from the amounts included in the financial statements. The
Board has considered the critical accounting estimates and
assumptions used in the financial statements and concluded that the
areas of judgement that have the most significant effect on the
amounts recognised in the financial statements are as set out
below.
Recoverability of deferred exploration costs
All costs directly attributable to exploration are capitalised
on a project basis, pending a decision on the economic feasibility
of the project. The capitalisation of such costs gives rise to an
intangible asset in the consolidated and parent company statements
of financial position. Exploration costs are capitalised where it
is considered likely that the amount will be recovered by future
exploitation, sale or alternatively where the activities have not
reached a stage which permits a reasonable assessment of the
existence of reserves. This requires management to make estimates
and assumptions as to the future events and circumstances,
especially in relation to whether an economically viable extraction
operation can be established. Such estimates are subject to change
and should it become apparent that recovery of the expenditure is
unlikely, the relevant amount is written off in the statement of
comprehensive income.
Receivables from Group undertakings
The Company makes assumptions when implementing the
forward-looking ECL model. This model is used to assess
intercompany loans for impairment.
Estimates are made regarding the credit risk and the underlying
probability of default in each of the credit loss scenarios. The
scenarios identified by the Company are production, divestment,
fire-sale and failure. The Directors make judgements on the
expected likelihood and outcome of each of the scenarios, and these
expected values are applied to the loan balances.
4 Segmental reporting
During the year, the Group had one business segment which was
exploration for gold and copper resources. Accordingly, no
segmental analysis is appropriate.
5 Staff costs
Number of employees
The monthly average number of employees (excluding Directors) of
the Group during the year was:
2022 2021
No. No.
Professional 2 2
----- -----
Employment costs (excluding directors) 2022 2021
GBP GBP
Wages and salaries 126,531 106,422
Post-employment benefits 8,687 10,363
-------- --------
Total 135,218 116,785
-------- --------
Directors' emoluments
2022
Short-term benefits Post-employment benefits Total
GBP GBP GBP
David Price 162,547 16,662 179,209
Gordon Hart 88,699 9,092 97,791
Ian Staunton 31,576 - 31,576
Patrick Elliott 29,540 - 29,540
Nicholas Walley 31,576 - 31,576
-------------------- ------------------------- --------
Total 343,938 25,754 369,692
-------------------- ------------------------- --------
2021
Short-term benefits Post-employment benefits Total
GBP GBP GBP
David Price 150,000 14,639 164,639
Gordon Hart 79,992 7,985 87,977
Ian Staunton 30,000 - 30,000
Patrick Elliott 28,000 - 28,000
Nicholas Walley 30,731 - 30,731
-------------------- ------------------------- --------
Total 318,723 22,624 341,347
-------------------- ------------------------- --------
The key management personnel of the Group are considered to be
the Directors.
6 Operating loss
Operating loss is stated after charging:
2022 2021
GBP GBP
Fees payable to the Group auditor for the audit of the Group and Company financial statements 27,960 24,750
Fees payable to the Group auditor for the taxation services 2,000 1,850
Impairment of intangible assets - 12,334
7 Taxation
2022 2021
GBP GBP
Factors affecting tax charge for the year
Loss on ordinary activities before taxation (753,212) (744,953)
Loss on ordinary activities at the UK standard rate of 19% (2021: 19%) (143,110) (141,541)
---------- ----------
Effects of:
UK carried forward losses 95,432 82,253
Non-deductible expenses 45 24,491
Losses of overseas subsidiaries carried forward 47,633 34,797
---------- ----------
Current tax charge - -
---------- ----------
The Group has estimated UK tax losses of approximately
GBP5,671,000 (2021: GBP5,061,000), and losses of overseas
subsidiaries approximately GBP1,153,000 (2021: GBP863,000)
available to carry forward against future trading profits. The
Group has not recognised a deferred tax asset on any losses carried
forward due to the uncertainty of future profits.
8 Earnings per share
2022 2021
GBP GBP
Loss for the purpose of basic and diluted loss per share ( 753,212 ) (744,953)
Weighted average number of ordinary shares for the purpose of basic and diluted
loss per share 1,166,576,254 974,997,979
Loss per share - basic and diluted (pence) (0.06) (0.08)
-------------- ------------
Basic EPS is calculated by dividing the loss attributable to
equity holders of the Company by the weighted average number of
ordinary shares in issue during the year. Diluted EPS is calculated
by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary
shares. The Company, being loss making in both this year and the
comparative period would mean that any exercise would be
anti-dilutive.
9 Intangible assets
Group Exploration costs
GBP
At 1 January 2021 2,655,196
Additions 918,667
Impairment (12,334)
Foreign exchange differences (113,790)
------------------
At 31 December 2021 3,447,739
------------------
At 1 January 2022 3,447,739
Additions 459,292
Acquisition 394,530
Foreign exchange differences 149,557
------------------
At 31 December 2022 4,451,118
------------------
As at 31 December 2022, the Group had future commitments of
GBP6,910,544 (2021: GBP9,342,018) in relation to exploration
projects:
Minimum
Rent spend
GBP GBP
1 year 7,397 609,993
Later than 1 year but no more than 5 years 486,186 5,806,968
-------- ----------
Total 493,583 6,416,961
-------- ----------
Company Exploration
costs
GBP
At 1 January 2021 13,380
Additions -
------------
At 31 December 2021 13,380
------------
At 1 January 2022 13,380
Transferred to subsidiary (13,380)
------------
At 31 December 2022 -
------------
10 Property, plant and equipment
Group Motor Office Building Total
vehicles equipment improvements
GBP GBP GBP GBP
Cost
At 1 January 2021 30,445 3,165 - 33,610
Additions - 2,690 - 2,690
Foreign exchange differences (1,468) (178) - (1,646)
---------- ----------- -------------- --------
At 31 December 2021 28,977 5,677 - 34,654
---------- ----------- -------------- --------
At 1 January 2022 28,977 5,677 - 34,654
Additions 20,773 3,165 1,065 25,003
Foreign exchange differences 2,247 347 44 2,638
---------- ----------- -------------- --------
At 31 December 2022 51,997 9,189 1,109 62,295
---------- ----------- -------------- --------
Depreciation
At 1 January 2021 7,097 807 - 7,904
Charge for the year - 2,619 - 2,619
Depreciation capitalised 4,433 - - 4,433
Foreign exchange differences (417) (74) - (491)
---------- ----------- -------------- --------
At 31 December 2021 11,113 3,352 - 14,465
---------- ----------- -------------- --------
At 1 January 2022 11,113 3,352 - 14,465
Charge for the year 534 4,507 - 5,041
Depreciation capitalised 3,637 - - 3,637
Foreign exchange differences 563 266 - 829
---------- ----------- -------------- --------
At 31 December 2022 15,847 8,125 - 23,972
---------- ----------- -------------- --------
Net book value
---------- ----------- -------------- --------
At 31 December 2021 17,864 2,325 - 20,189
---------- ----------- -------------- --------
At 31 December 2022 36,150 1,064 1,109 38,323
---------- ----------- -------------- --------
10 Property, plant and equipment (continued)
Company Office equipment Total
GBP GBP
Cost
At 1 January 2021 - -
Additions 1,150 1,150
At 31 December 2021 1,150 1,150
----------------- ------
At 1 January 2022 1,150 1,150
Additions - -
At 31 December 2022 1,150 1,150
----------------- ------
Depreciation
At 1 January 2021 - -
Charge for the year 460 460
At 31 December 2021 460 460
----------------- ------
At 1 January 2022 460 460
Charge for the year 581 581
At 31 December 2022 1,041 1,041
----------------- ------
Net book value
At 31 December 2021 690 690
----------------- ------
At 31 December 2022 109 109
----------------- ------
11 Investments
Company 2022 2021
GBP GBP
At beginning and end of the year 648,000 648,000
Additions in respect of acquisitions 362,147 -
Additional issue of share capital 20,493 -
---------- --------
Total 1,030,640 648,000
---------- --------
On 8 March 2022, Rockfire announced the winning of an Open
International Tender for a 30-year licence to explore and mine the
high-grade Molaoi Zn/Pb/Ag deposit, located in the Hellenic
Republic of Greece. Rockfire participated in the tender under a
Memorandum of Understanding with a local Greek company, Hellenic
Minerals IKE, now Hellenic Minerals SA ("Hellenic"), the applicant
in the tender.
On 16 May 2022, the Company acquired 100% of the issued share
capital in Hellenic. Consideration was paid by the Company issuing
50,000,000 new ordinary shares to the vendors of Hellenic at an
issue price of 0.01p and potential deferred consideration of
GBP400,000 in respect of obtaining a JORC-compliant mineral
resource exceeding four hundred thousand tonnes of zinc equivalent
value. The vendors of Hellenic retain a 2% gross production royalty
on saleable product from all metals extracted from the Molaoi
project. The Company has the option to acquire the gross production
royalty for a cash consideration of GBP1,000,000 at any time. The
following table summarises the net liabilities acquired, and
assumed at the acquisition date:
Fair value
GBP's
----------
Trade and other receivables 17,070
Cash and cash equivalents 82,282
Trade and other payables (131,735)
Net liabilities acquired (32,383)
----------
Consideration 362,147
Fair value attributable to exploration assets 394,530
----------
11 Investments (continued)
Additional share capital investment of EUR24,000 was agreed by
the Board on 8 August 2022, in respect of the conversion of
Hellenic to an SA company, to meet the statutory requirements of
capital invested per Greek company law.
The Group's subsidiary undertakings at 31 December 2022, were as
follows:
Proportion Class of Nature Country
Entity name held shareholding of business of incorporation Registered office
Papua Mining 100% Ordinary Dormant British c/o AA Corporate Management
Limited Virgin 13, Boulevard Princesse
Islands Charlotte, Monte Carlo,
Monaco, MC98000
----------- -------------- ------------- ------------------ ----------------------------
BGM Investments 100% Ordinary Exploration Australia c/o WSC Group Accountants,
Pty Limited 11/800-812 Old Illawarra
Road, Menai, NSW 2234,
Australia
----------- -------------- ------------- ------------------ ----------------------------
Hellenic 100% Ordinary Exploration Greece Philellinon No 9,
Minerals Alexandroupoli, 68131,
SA Greece.
----------- -------------- ------------- ------------------ ----------------------------
12 Trade and other receivables
Current 2022 2021
Group GBP GBP
Other receivables 106,171 124,261
---------- ----------
2022 2021
Company GBP GBP
Amounts owed by Group undertakings 4,561,444 3,493,473
Other receivables 44,375 79,860
---------- ----------
Total 4,605,819 3,573,333
---------- ----------
Receivables due from Group undertakings are net of cumulative
ECLs of GBP704,890 (2021: GBP618,868). Other receivables comprise
prepayments.
Non - Current 2022 2021
Group GBP GBP
Other receivables 85,872 -
------- -----
The other receivables balance of GBP85,872 (2021: GBPNil)
relates to deposits held in respect of a guarantee given to the
Greek Government which expires in 2028.
13 Share capital
Group and Company
Issued share capital 2022 2021
No. No.
Deferred shares of GBP0.099 each 51,215,534 51,215,534
Ordinary shares of GBP0.001 each 1,439,739,067 1,082,466,125
Ordinary Shares
2022 2021
Number Number
Allotted, called up and
fully paid
At 1 January 1,082,466,125 832,415,592
Issued for cash 300,000,000 246,429,200
Issued in lieu of fees 7,272,942 3,621,333
Issued in asset acquisition 50,000,000 -
At 31 December 1,439,739,067 1,082,466,125
-------------- ----------------
Share Capital
2022 2021
GBP GBP
Allotted, called up and
fully paid
At 1 January 7,078,136 6,828,086
Issued for cash(1) 300,000 246,429
Issued in lieu of fees 7,273 3,621
Issued in asset acquisition 50,000 -
At 31 December 7,435,409 7,078,136
---------- ------------
(1) In the year ended 31 December 2022 includes issue costs of
GBP42,410 (2021: GBP108,690).
The nominal value of the issued share capital includes a
cumulative foreign exchange difference of GBP925,332 which
crystallised in 2017 when the Group's functional and presentational
currency was changed from US$ to GBP.
14 Reserves
Share premium
The share premium account represents amounts subscribed for
share capital in excess of nominal value, net of directly
attributable issue costs.
Foreign exchange reserve
Cumulative gains and losses on translating the net assets of
overseas operations to the presentation currency.
Merger relief reserve
The balance on the merger relief reserve represents the fair
value of the consideration given in excess of the nominal value of
the ordinary shares issued as consideration on the acquisition of
Hellenic.
Other reserves
Represents the reserve arising from a share for share exchange
as part of a group reorganisation in 2011.
15 Share options and warrants
Share options
2022 2021
Weighted Weighted
average average
exercise exercise
Options price Options price
No. GBP No. GBP
Outstanding at 1 January 54,000,000 0.02 18,000,000 0.02
Granted during the year - - 36,000,000 0.02
Lapsed during the year - - - -
----------- ---------- ----------- ----------
Outstanding at 31 December 54,000,000 0.02 54,000,000 0.02
=========== ========== =========== ==========
Exercisable at 31 December 54,000,000 0.02 54,000,000 0.02
=========== ========== =========== ==========
The weighted average life of the outstanding and exercisable
options was 366 days (2021 :2 years and 163 days).
Share options held by Directors were as follows:
2022 2021
No. No.
David Price 10,000,000 10,000,000
Gordon Hart 10,000,000 10,000,000
Ian Staunton 6,000,000 6,000,000
Patrick Elliot 6,000,000 6,000,000
Nicholas Walley 6,000,000 6,000,000
Warrants 2022 2021
Weighted Weighted
average exercise average exercise
Warrants price Warrants price
No. GBP No. GBP
Outstanding at 1 January 30,899,999 0.010 30,899,999 0.010
Lapsed during the year 30,899,999 0.010 - -
Outstanding and exercisable at 31 December - - 30,899,999 0.010
=========== ================== =========== ==================
The weighted average life of the outstanding and exercisable
warrants at 31 December 2021 was 279 days.
16 Trade and other payables
2022 2021
Group GBP GBP
Trade payables 80,587 47,006
Other payables 22,278 17,128
Accruals 57,209 46,250
-------- --------
Total 160,074 110,384
-------- --------
2022 2021
Company GBP GBP
Trade payables 46,667 46,242
Other payables 20 3,086
Accruals 43,612 35,657
-------- --------
Total 90,299 84,985
-------- --------
17 Financial instruments
In common with other businesses, the Group is exposed to risks
that arise from its use of financial instruments. This note
describes the Group's objectives, policies and processes for
managing those risks and the methods used to measure them. Further
quantitative information in respect of these risks is presented
throughout these financial statements.
The significant accounting policies regarding financial
instruments are disclosed in note 3.
The Group does not have any derivative products or any long-term
borrowings. The Group is not exposed to interest-bearing
indebtedness. The exploration activities of the Group are financed
by the proceeds of share issues.
Principal financial instruments
The principal financial instruments used by the Group, from
which financial instrument risk arises, are as follows:
2022 2021
Group GBP GBP
Financial assets
Cash and cash equivalents 506,127 1,473,599
Trade and other receivables - -
---------- ----------
Total 506,127 1,473,599
---------- ----------
Financial liabilities
Trade payables 80,587 47,007
Other payables 22,278 62,650
---------- ----------
Total 102,865 109,657
---------- ----------
Company
Financial assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 4,605,819 4,112,412
---------- ----------
Total 4,642,824 5,533,213
---------- ----------
Financial liabilities
Trade payables 46,667 46,242
Other payables 43,632 38,743
---------- ----------
Total 90,299 84,985
---------- ----------
The Directors consider that the fair value of the above
financial instruments is equal to the carrying values.
General objectives, policies and processes
The Directors have overall responsibility for the determination
of the Group's risk management objectives and policies. The Board
regularly reviews the effectiveness of the processes put in place
and the appropriateness of the objectives and policies it sets.
The overall objective of the Directors is to set policies that
reduce risk as far as possible without unduly affecting the Group's
competitiveness and flexibility.
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations. The carrying amount of financial
assets represents the maximum credit exposure. The maximum exposure
to credit risk at the reporting date was as follows:
17 Financial instruments (continued)
2022 2021
Group GBP GBP
Financial assets
Cash and cash equivalents 506,127 1,473,599
Trade and other receivables 106,171 -
---------- ----------
Total 612,298 1,473,599
---------- ----------
Company
Financial assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 4,605,819 4,112,412
---------- ----------
Total 4,642,824 5,533,213
---------- ----------
Liquidity risk
Liquidity risk relates to the ability of the Group to meet
future obligations and financial liabilities. To date the Group has
relied upon shareholder funding of its activities. Future
exploration and development activities is dependent upon the
Group's ability to obtain further financing through equity
financing or other means.
The following table shows the Group's financial liabilities:
2022 2021
Group GBP GBP
Financial liabilities
Trade payables 80,587 47,006
Other payables 22,278 62,650
-------- --------
Total 102,865 109,656
-------- --------
Company
Financial liabilities
Trade payables 46,667 46,242
Other payables 43,632 38,743
-------- --------
Total 90,299 84,985
-------- --------
The financial statements have been prepared on a going concern
basis and note 3(d) provides further information in this
regard.
Foreign currency risk
Foreign currency risk refers to the risk that the value of a
financial commitment, recognised asset or liability will fluctuate
due to changes in foreign currency rates.
The Group operates in Australia and Greece. As such the Group is
exposed to transaction foreign exchange risk. The mix of currencies
and terms of trade with its suppliers are such that the Directors
believe that the Group's exposure is minimal and consequently they
have not, to date, specifically sought to hedge that exposure. Most
of the Group's funds are in GBP with only sufficient funds held
overseas to meet local costs. The Group and Company's net exposure
to foreign currency risk at the reporting date is as follows:
Group Company
Net foreign currency Year Year Year Year
financial (liabilities)/assets ended ended ended ended
31 December 31 December 31 December 31 December
2022 2021 2022 2021
GBP GBP GBP GBP
EURO 83,781 - - -
AUD 376,655 69,075 - (2,728)
------------- ------------- ------------- -------------
460,436 69,075 - (2,728)
17 Financial instruments (continued)
Sensitivity analysis
The following table details the impact of changes in foreign
exchange rates on financial assets and liabilities at the balance
sheet date, illustrating the (decrease)/increase in Group operating
result caused by a 10 per cent strengthening of GBP compared to the
year-end spot rate. The analysis assumes that all other variables
remain constant.
Profit or loss Equity
Net foreign currency Year Year Year Year
financial ended ended ended ended
(liabilities)/assets 31 December 31 December 31 December 31 December
2022 2021 2022 2021
GBP GBP GBP GBP
Euros (8,378) - (8,378) -
AUD (37,666) (6,907) (37,666) (6,907)
------------- ------------- ------------- -------------
(46,044) (6,907) (46,044) (6,907)
Commodity price risk
Commodity price risk is the risk that the Group's future
earnings will be adversely impacted by changes in the market prices
of commodities. The Group is not currently exposed to commodity
price risk, but future revenues will be determined by reference to
market commodity prices.
Capital management
The Group's objectives when managing capital is to maintain its
ability to continue as a going concern in order to provide returns
for shareholders and benefits for other stakeholders and to ensure
sufficient resources are available to meet day to day operating
requirements. The Group defines capital as 'equity' and 'cash' as
shown in the consolidated statement of financial position. As at 31
December 2022 the Group held equity and cash balances of
GBP4,941,665 and GBP506,127 (2021: GBP4,955,405 and GBP 1,473,599
), respectively. The Board takes full responsibility for managing
the Group's capital and does so through Board meetings and reviews
of financial information.
The Group's policy is to invest its cash in deposits with high
credit worthy financial institutions with short term maturity.
18 Related party transactions
During the year, the Company advanced funds to BGM Investments
Pty Ltd totalling GBP570,641 (2021: GBP1,109,832). The loan is
repayable in GBP on demand and as at 31 December 2022, GBP3,981,077
(2021: GBP3,493,473) was outstanding. A cumulative expected credit
loss provision of GBP704,890 (2021: GBP618,869) has been recognised
at the year-end in respect of the loan.
During the year, the Company advanced funds to Hellenic
totalling GBP563,635 and transferred exploration costs of
GBP13,380. The loan is repayable in GBP on demand and as at 31
December 2022, GBP580,344 was outstanding.
On 16 May 2022, the Company issued 50,000,000 new ordinary
shares to the vendors of Hellenic Minerals as settlement of Tranche
1 of the acquisition agreement for the Molaoi project in Greece.
David Price (or his related party nominees) was issued 25,000,000
of these new ordinary shares in the Company as per an historic
agreement with the vendors as previously reported. Further details
of the acquisition are set out in note 11.
19 Subsequent events
On 9 January 2023, the Company issued 4,475,758 new ordinary
shares to Patrick Elliott in settlement of Director's fees.
On 20 January 2023, the Company announced that it has entered
into a joint venture arrangement with Sunshine Gold Limited on the
Lighthouse and Kookaburra tenements in Queensland, Australia.
Details of the arrangement are set out in the Chairman's
Statement.
19 Subsequent events (continued)
On 1 June 2023, the Company announced that it had raised
GBP880,000, before expenses, through a subscription of 400,000,000
new ordinary shares of 0.1pence each at a price of 0.22 pence per
share.
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END
FR UPUMCQUPWGGQ
(END) Dow Jones Newswires
June 06, 2023 07:50 ET (11:50 GMT)
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