TIDMFMET
RNS Number : 9839X
Fulcrum Metals PLC
28 December 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. With
the publication of this announcement, this information is now
considered to be in the public domain.
Fulcrum Metals plc / EPIC: FMET / Market: AIM / Sector:
Mining
28 December 2023
Fulcrum Metals plc
("Fulcrum" or "the Company")
Unaudited interim results for the six month period ended 30
September 2023
Fulcrum Metals plc (LON: FMET), a company focused on mineral
exploration and development in Canada, announces its unaudited
consolidated interim results for the six month period ended 30
September 2023.
Corporate and Operational Highlights:
-- Extensive exploration programmes were conducted during the
period across the Group's Schreiber-Hemlo projects, Big Bear and
Jack Fish. Initial exploration results confirmed the prospectivity
of the Big Bear project with notable high-grade rock sample results
of 45g/t Au, 37.4g/t Au and 33.6g/t Au.
-- Acquisition of Carib Creek East in April 2023 has extended
the Winston Lake project and the Company's footprint across a
highly prospective mining area.
-- Start of field operations at Schreiber-Hemlo designed to
further refine and evaluate previously identified targets.
-- Completion of Big Bear phase two exploration finds 3km
mineralised corridor- four drill prospects have been identified
with a further five prospects needing further investigation.
-- Acquisition of the Tully Gold project- with an established
mine camp, infrastructure, and historic gold resource of 107,000
ounces of gold, Tully has become Fulcrum's most advanced
project.
-- Fundraising of GBP520,000 through the issue of unsecured
convertible loan notes to fund the acquisition of the Tully Gold
project.
Post Period Highlights:
-- Fulcrum has increased its Saskatchewan uranium footprint by
approximately 221% from 18,468 hectares (184.5km(2) ) to 59,310
hectares (593.1km(2) )- the uranium projects now consist of the
Charlot-Neely Lake, Fontaine Lake, Snowbird and South Pendleton
projects.
-- The Company announced on 27 November 2023 that it was
reviewing its options with interested parties on its Saskatchewan
uranium properties. These options include, but are not limited to,
the potential spin out of the uranium properties.
-- An option was entered into on 30 November 2023 giving Fulcrum
the opportunity to acquire 100% of Teck-Hughes Gold Tailings
Project in Ontario, Canada - the mine itself has historically
milled 9,565,302 tons of ore and produced 3,700,007 ounces of
gold.
-- Advanced discussions are taking place with Extrakt Process
Solutions, to licence its sustainable gold leaching technology, to
be used at Teck-Hughes gold tailings project. Teck-Hughes has the
potential to become Fulcrum's first cash generative project.
Ryan Mee, Chief Executive Officer of Fulcrum, commented :
"The Company's objective when it listed on AIM was to provide
shareholder value through the development of highly prospective
mining projects alongside complementary acquisitions."
"During the reporting period Fulcrum has moved at speed to
discover and scale our exploration assets across Canada, in
particular in Ontario, with extensive exploration programmes
conducted at Big Bear and Jackfish. There have been some notable
results including rock samples of up to 45g/t Au and the
identification of multiple structural targets in the
Schreiber-Hemlo area."
"We have also strengthened our portfolio of assets with several
acquisitions: the Tully Gold project, which has a historical
resource of 107,000 ounces of gold, and Carib Creek East. Post
period, and on the back of ongoing positive sentiment for uranium,
we announced a 221% increase in our Saskatchewan footprint, and the
option to acquire the Teck-Hughes Gold Tailings Project in Ontario.
The latter is particularly exciting, with over 6 million tonnes of
tailings ready to be processed and with the use of innovative
technology, the Board believes it has the potential to become a
cash generative asset in a relatively short space of time."
Corporate and Operational Review
The Company's strategy is to focus on the discovery of economic
deposits and commercialisation of its projects using its three
defined pillars: Explore, Discover and Scale. During the reporting
period Fulcrum has delivered on all three pillars of its
strategy.
Operationally, Fulcrum has continued to increase its
understanding of its highly prospective projects through targeted
exploration programmes. In March a successful exploration programme
at the Big Bear property was announced, yielding high grade results
including 45g/t Au, 37.4g/t Au and 33.6g/t Au. Also, in March it
was announced that the Company had identified multiple structural
targets at the Big Bear and Jackfish properties.
Post period, the Company continued to advance its projects
across Ontario and Saskatchewan with airborne surveys at Big Bear
and Tocheri lake, where a further 250 geophysical anomalies were
identified at the Big Bear project.
The Company's contacts in country, sector knowledge and ability
to move quickly enables it to capitalise on prospects that aren't
always available widely to others. There have been several
opportunities during and post period that have the potential to
accelerate the Company's growth and make it cash generative,
particularly the option to acquire the Teck-Hughes Gold Tailings
Project ("Teck-Hughes") in Ontario, announced in November 2023,
where Extrakt's sustainable leaching technology, which does not use
cyanide, can be used to process historic tailings on site,
estimated at approximately 6,531,300 tons of material at 0.66g/ton
Au for 138,460 ounces contained Au.
Other acquisitions include the acquisition of Carib Creek East
in April 2023, which encompassed 42 claim cells covering 8.9km(2).
In addition, and on the back of positive investor sentiment for
uranium, the Company has increased its Saskatchewan uranium
footprint by approximately 221% from 18,468 hectares (184.5km2) to
59,310 hectares (593.1km2). Fulcrum's uranium projects consist of
Charlot-Neely Lake, Fontaine Lake, Snowbird and South Pendleton.
The Company has consistently increased its stake in the
Charlot-Neely Lake project. The first increase was announced in
October 2023 with a subsequent increase announced in November 2023.
Fulcrum has expanded its stake in Charlot-Neely Lake by c.215% from
7,625 hectares to 16,372 hectares.
Despite challenging market conditions, Fulcrum has continued to
advance existing projects whilst creating opportunities, via option
agreements and acquisitions, in highly prospective projects. The
Board is excited about the future of the Company and looks forward
to updating the market on our progress in due course.
Financial
The Company generated no revenue during the period but focussed
on exploring and developing assets that the Board believes will
generate revenue for the Company in the future.
For the six-month period ended 30 September 2023 the Company
reported a pre-tax loss of GBP 434,473 (six months ended 30
September 2022: pre-tax loss of GBP187,723).
The Company's net cash balance as at 30 September 2023 was
GBP804,026 (30 September 2022: GBP239,082).
For more information, please visit www.fulcrummetals.com or
contact the following:
Fulcrum Metals plc
Ryan Mee, Chief Executive Officer Via St Brides Partners Limited
Allenby Capital Limited (Nominated
Adviser)
Nick Athanas / George Payne +44 (0) 203 328 5656
Clear Capital Markets Limited
(Broker)
Bob Roberts +44 (0) 203 869 6081
St Brides Partners Ltd (Financial
PR)
Ana Ribeiro / Paul Dulieu +44 (0) 207 236 1177
UNAUDITED INTERIM FINANCIAL INFORMATION ON
FULCRUM METALS PLC
Consolidated Income Statement of Comprehensive Income
for the six months ended 30
September 2023
Unaudited Unaudited Unaudited
6 months 6 months Year
Notes ended ended ended
30 Sept '23 30 Sept '22 31 Dec '22
GBP GBP GBP
Turnover - - -
----------------------- --------------------- ---------------------
Administration expenses (354,065) (111,671) (254,340)
----------------------- --------------------- ---------------------
Operating Loss (354,065) (111,671) (254,340)
Exceptional item 2 - - (268,056)
Finance Cost (80,459) (76,052) (97,202)
Finance Income 51 - -
Loss before taxation (434,473) (187,723) (619,598)
Income Tax - - -
Loss for the financial period (434,473) (187,723) (619,598)
Other comprehensive income 17,959 7,395 9,169
Total comprehensive loss for
the financial period (416,514) (180,328) (610,429)
======================= ===================== =====================
Consolidated Statement of Financial Position
as at 30
September 2023
Unaudited Unaudited Unaudited
30 Sept '23 30 Sept '22 31 Dec
Notes '22
Assets GBP GBP GBP
Non-Current
Assets
Intangible
assets 3 3,778,339 437,876 651,489
Tangible
assets 1,203 - 1,591
3,779,542 437,876 653,080
Current Assets
Trade and
other
receivables 60,827 183,995 530,644
Cash and cash
equivalents 4 804,026 239,082 96,984
864,853 423,077 627,628
Total Assets 4,644,395 860,953 1,280,708
====================================== ============================================= =================================
Equity &
Liabilities
Shareholders'
Equity
Share capital 8 499,609 132,441 190,993
Share premium 8 5,440,273 174,794 710,200
Currency
translation
reserve (16,617) (7,653) (9,169)
Share option
reserve 7 186,298 269,054 448,356
Merger reserve (161,445) - (161,445)
Retained
earnings (1,884,689) (253,560) (658,032)
Total Equity 4,063,429 315,076 520,903
====================================== ============================================= =================================
Current
Liabilities
Convertible
loan notes 6 - 479,468 113,366
Trade and
other
payables 5 99,052 66,409 646,439
-------------------------------------- --------------------------------------------- ---------------------------------
99,052 545,877 759,805
Non Current
Liabilities
Convertible
loan notes 6 481,914 - -
Total
Liabilities 580,966 545,877 759,805
====================================== ============================================= =================================
Total Equity
and
Liabilities 4,644,395 860,953 1,280,708
====================================== ============================================= =================================
Consolidated Statement of Cash flows
for the six months ended
30 September 2023
Unaudited Unaudited Unaudited
6 months ended 6 months ended Year ended
Notes 30 Sept '23 30 Sept '22 31 Dec '22
GBP GBP GBP
Cash flows from operating
activities
Loss for the period (434,473) (187,723) (619,598)
Adjustments for :
Depreciation 259 - 510
Impairment - - 23,007
Finance expense 64,209 76,052 97,202
Finance income - - -
Currency Translation (3,983) 41 (4,820)
Decrease / (Increase)
in trade and other receivables 155,973 (176,931) (527,017)
Increase in trade and
other payables (78,347) 2,937 507,415
---------------- ---------------- ------------
Net cash used in operating
activities (296,362) (285,624) (523,301)
Cash flows from investing
activities
Acquisition of property,
plant and equipment - - (2,122)
Acquisition of intangible
exploration assets (997,773) (173,664) (424,679)
---------------- ---------------- ------------
Net cash used in investing
activities (997,773) (173,664) (426,801)
Cash flows from financing
activities
Proceeds on the issue
of share capital - 109,541 338,010
Proceeds on the issue
of convertible loan notes 520,000 420,549 453,463
Director's loan - - 100,000
Proceeds Held on Account
(CLN) - 30,905 -
Net cash from financing
activities 520,000 560,995 891,473
Net (decrease)/increase
in cash and cash equivalents (774,135) 101,707 (58,629)
---------------- ---------------- ------------
Cash and cash equivalents
at start of period 1,578,161 137,375 155,613
Cash and cash equivalents
at end of period 804,026 239,082 96,984
================ ================ ============
Consolidated Statement of Changes in Equity
for the six months ended 30 Sept 2023
Share Share Share Option Other Retained
Capital Premium Reserves Reserves Earnings Total Equity
Unaudited GBP GBP GBP GBP GBP GBP
Balance at 1
April 2022 117,367 49,555 134,320 (258) (65,836) 235,148
Loss for the
financial
period - - - (7,395) (187,724) (195,119)
------------- -------------- ------------------- ------------- --------------- -----------------
Total
comprehensive
loss for the
period - - - (7,395) (187,724) (195,119)
Issue of new
shares 15,073 125,239 - - 140,312
Fair value
movement 134,734 134,734
------------- -------------- ------------------- ------------- --------------- -----------------
15,073 125,239 134,734 - - 275,046
Balance at 30
Sept 2022
(unaudited) 132,441 174,794 269,054 (7,653) (253,560) 315,076
Unaudited
Balance at 1
January 2022 116,580 49,223 133,420 871 (38,434) 261,660
Loss for the
financial
year - - - - (619,598) (619,598)
Fx Adjustment
on opening
retained
earnings - - - (10,040) - (10,040)
------------- -------------- ------------------- ------------- --------------- -----------------
Total comprehensive loss for
the year - - (10,040) (619,598) (629,638)
Issue of new
shares 74,413 660,977 - - - 735,390
Recognition of
equity
component of
convertible
loan notes - - 398,817 - - 398,817
Exercise of
convertible
loan notes - - (248,198) - - (248,198)
Fair value
movement on
warrants - - 97,202 - - 164,317
Fair value
movement on
CLNs 67,115
Merger Reserve - - - (161,445) - (161,445)
------------- -------------- ------------------- ------------- --------------- -----------------
74,413 660,997 314,936 (161,445) - 888,879
Balance at 31
December 2022 190,993 710,200 448,356 (170,614) (658,032) 520,903
============= ============== =================== ============= =============== =================
Unaudited
Balance at 1
April 2023 498,592 5,422,467 84,002 (160,103) (1,450,216) 4,394,742
Loss for the
period - - - (17,959) (434,473) (452,432)
------------- -------------- ------------------- ------------- --------------- -----------------
Total
comprehensive
loss for the
period - - - (17,959) (434,473) (452,432)
Issue of new
shares 1,017 17,806 - - - 18,823
Recognition of
equity
component of
convertible
loan notes - - 53,546 - - 53,546
Equity
Fair value
movement - - 48,750 - - 48,750
------------- -------------- ------------------- ------------- --------------- -----------------
1,017 17,806 102,296 - - 121,119
------------- -------------- ------------------- ------------- --------------- -----------------
Balance at 30
Sept 2023
(unaudited) 499,609 5,440,273 186,298 (178,062) (1,884,689) 4,063,429
============= ============== =================== ============= =============== =================
Notes to the interim financial information
for the six months ended 30 September 2023
1. Presentation of accounts and accounting policies
(a) Reporting Entity
Fulcrum Metals plc (the "Company") and its subsidiaries
(together, the "Group") explore for and develop mineral reserves in
Canada.
The Company is a public limited company, incorporated,
domiciled, and registered in England and Wales. The registered
number is 14409193. The company's registered office and principal
place of business is Unit 58, Basepoint Business Centre Isidore
Road, Bromsgrove Enterprise Park, Bromsgrove, Worcestershire, B60
3ET, England.
These are the second consolidated interim financial statements
of the Group following the reorganisation of the Group to
facilitate the listing on the AIM market of the London Stock
Exchange plc. The result of the application of the capital
reorganisation is to present the consolidated financial statements
(including comparatives) as if the Company has always owned the
Group. The share capital structure of the Company as at the date of
the Group reorganisation is pushed back to the first date of the
comparative period (10 October 2022). A Merger Reserve is created
as a separate component of equity, representing the difference
between the share capital of the Company at the date of the Group
reorganisation and that of the previous top organisation of the
Group.
(b) Basis of preparation
The financial statements have been prepared on the historical
cost basis. Where the carrying value of assets and liabilities are
calculated on a different basis, this is disclosed in the relevant
accounting policy. The accounting policies have been applied
consistently to all financial periods presented in the Consolidated
Financial Statements.
The Group interim financial information has been prepared in
accordance with International Financial Reporting Standards
("IFRS") and their interpretations issued by the International
Accounting Standards Board ("IASB") as adopted by the United
Kingdom ("UK adopted IFRS") insofar as these apply to interim
financial information.
The financial information set out in this interim consolidated
financial information for the six months ended 30 September 2023,
and its comparative information for both the 6 months ended 30
September 2022 and year ended 31 December 2022, is unaudited. The
financial information presented is not statutory accounts and are
prepared only to comply with AIM requirements for interim
reporting.
The UK adopted IFRS as applied by the Group in the preparation
of these financial statements are those that were effective on or
before 30 September 2023.
(c) Basis of consolidation
The consolidated interim financial information includes the
results of Fulcrum Metals plc and its subsidiary undertakings. The
financial statements of all group companies are adjusted, where
necessary, to ensure the use of consistent accounting policies.
The Group was formed after the Company, prior to its IPO and
listing on AIM, completed a share for share transaction with
Fulcrum Metals Limited. The Board has taken the view that the most
appropriate way to account for this in line with IFRS is to deem
the share for share exchange as a group reconstruction. This has
been accounted for under the basis of merger accounting given that
the ultimate ownership before and after the transaction remained
the same. There is currently no specific guidance on accounting for
group reconstructions such as this transaction under IFRSs. In the
absence of specific guidance, entities should select an appropriate
accounting policy and IFRS permits the consideration of
pronouncements of other standard-setting bodies. This group
reconstruction as scoped out of IFRS 3 has therefore been accounted
for using predecessor accounting principles resulting in the
following practical effects;
(i) The net assets of the Company and the predecessor group,
Fulcrum Metals Limited and its subsidiary undertakings (the
"Predecessor Group"), are combined using existing book values, with
adjustments made as necessary to ensure that the same accounting
policies are applied to the calculation of the net assets of both
entities;
(ii) No amount is recognised as consideration for goodwill or
negative goodwill;
(iii) The consolidated profit and loss account includes the
profits or losses of the company and the Predecessor Group for the
entire period, regardless of the date of the reconstruction, and
the comparative amounts in the consolidated financial statements
are restated to the figures presented by the Predecessor Group;
and
(iv) The retained earnings reserve includes the cumulative
results of the Company and the Predecessor Group, regardless of the
date of the reconstruction, and the comparative amounts in the
statement of financial position are restated to those presented by
the Predecessor Group.
(d) Significant accounting policies
The Group has presented below key extracts of its accounting
policies.
(e) Going concern - basis of accounting
The Directors have prepared the financial statements on the
going concern basis which assumes that the Group and Company will
continue in operational existence for at least twelve months from
the date of the approval of these financial statements as described
below.
The Group incurred a total comprehensive loss for the financial
period 30 September 2023 of GBP416,514 and held net assets of
GBP4,063,429 at the statement of financial position date.
In February 2023 Fulcrum Metals PLC completed the process of an
IPO onto the AIM market of the London Stock Exchange and raised
GBP3.0 million in connection with the admission of the company to
fund the new Group.
In August 2023 the Company raised GBP520,000 by the issue of
convertible loan notes and at 30 September 2023 has a cash balance
of GBP804,026.
Having considered the risks and uncertainties of the business,
their projections for the future performance of the Company, and
the current uncertain economic environment, the Directors have a
reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. The
board anticipates that additional funding will be required during
2024 to further its exploration projects and increase shareholder
value. Accordingly, they continue to adopt the going concern basis
in preparing the interim financial statements.
Based on the above considerations and assessment, the Directors
are satisfied that no significant doubt exists on the company's
ability to continue as a going concern and adequate disclosure has
been made in the financial statements.
(f) Intangible Assets
Exploration and evaluation assets
The Group recognises expenditure as exploration and evaluation
assets when it determines that those assets will be successful in
finding specific mineral resources. Expenditure included in the
initial measurement of exploration and evaluation assets and which
are classified as intangible assets, relate to the acquisition of
rights to explore, topographical, geological, geochemical and
geophysical studies, exploratory drilling, trenching, sampling and
activities to evaluate the technical feasibility and commercial
viability of extracting a mineral resource. Capitalisation of
pre-production expenditure ceases when the mining property is
capable of commercial production.
Exploration and evaluation assets are recorded and held at cost.
Exploration and evaluation assets are assessed for impairment
annually or when facts and circumstances suggest that the carrying
amount of an asset may exceed its recoverable amount. The
assessment is carried out by allocating exploration and evaluation
assets to cash generating units, which are based on specific
projects or geographical areas. IFRS 6 permits impairments of
exploration and evaluation expenditure to be reversed should the
conditions which led to the impairment improve. The Group
continually monitors the position of the projects capitalised and
impaired.
Whenever the exploration for and evaluation of mineral resources
in cash generating units does not lead to the discovery of
commercially viable quantities of mineral resources and the Group
has decided to discontinue such activities of that unit, the
associated expenditures are written off to the Income
Statement.
Impairment
Exploration and evaluation assets are reviewed regularly for
indicators of impairment and costs are written off where
circumstances indicate that the carrying value might not be
recoverable. In such circumstances, the exploration and evaluation
asset is allocated to development and production assets within the
same cash generating unit and tested for impairment. Any such
impairment arising is recognised in the income statement for the
period. Where there are no development and production assets, the
impaired costs of exploration and evaluation are charged
immediately to the income statement.
(g) Judgements and key sources of estimation uncertainty
The preparation of the Group Financial Statements in conformity
with IFRSs requires Management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amount of expenses during the
year. Actual results may vary from the estimates used to produce
these Financial Statements.
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.
Significant items subject to such estimates and assumptions
include, but are not limited to:
Impairment of exploration and evaluation costs
Exploration and evaluation costs have a carrying value at 30
September 2023 of GBP3,778,339 (30 September 2022: GBP437,876) (31
December 2022: GBP651,489): refer to Note 3 for more information.
The Group has a right to renew exploration permits and the asset is
only depreciated once extraction of the resource commences.
Management tests annually whether exploration projects have future
economic value in accordance with the accounting policy stated in
Note (f). Each exploration project is subject to an annual review
by either a consultant or senior company geologist to determine if
the exploration results returned during the year warrant further
exploration expenditure and have the potential to result in an
economic discovery. This review takes into consideration the
expected costs of extraction, long term metal prices, anticipated
resource volumes and supply and demand outlook. In the event that a
project does not represent an economic exploration target and
results indicate there is no additional upside, a decision will be
made to discontinue exploration. The directors concluded that no
impairment charge was required as at 30 September 2023.
See Note 3 for the directors' assessment.
Valuation of warrants
The Group has made awards of warrants over its unissued share
capital to certain Directors and employees as part of their
remuneration package. Certain warrants have also been issued to
shareholders as part of their subscription for shares and to
suppliers for various services received.
The valuation of these options and warrants involves making a
number of critical estimates relating to price volatility, future
dividend yields, expected life of the options and forfeiture
rates.
2. Exceptional Items
These are legal and professional costs incurred relating to the
Company's admission to AIM.
3. Intangible assets
Intangible assets comprise acquisition, exploration and
evaluation costs. Exploration and evaluation assets are all
internally generated. These are measured at cost and have an
indefinite asset life. Once the pre-production phase has been
entered into, the exploration and evaluation assets will cease to
be capitalised and commence amortisation.
Exploration & Evaluation Assets - Cost and Net
Book Value
Mineral licence
Cost GBP
At 1 April 2022 264,212
Additions 173,664
--------------------------
At 30 Sept 2022 437,876
At 1 January 2022 250,739
Additions 424,680
Impairment (23,930)
--------------------------
At 31 December 2022 651,489
At 1 April 2023 2,785,710
Fx movement on opening balance (4,890)
Additions 997,773
Impairment -
--------------------------
At 30 September 2023 3,778,339
==========================
On 17 April 2023, Fulcrum Metals Canada Limited ("FMCL"), the
100% owned subsidiary of Fulcrum Metals Limited, expanded the
Winston Lake project acquiring the Carib Creek East property
consisting of 42 mining claims covering approximately 8.9 square
kilometres. Ryan Mee, Director of Fulcrum Metals Ltd and Chief
Executive Officer of Fulcrum Metals PLC, sold the mining claims to
the company for CA $2,100. A sedimentary-volcanic contact Zone has
been mapped across the length of the property exhibiting alteration
reportedly similar to that of the high-grade zinc-copper deposit at
Winston Lake. Historic soil sampling at Carib Creek East has
previously returned anomalous copper values over an area of
approximately 2 square kilometres, with values ranging up to
1,100ppm copper. Copper mineralisation has previously been
discovered on the property in quartz-carbonate veins, returning
grab sample assays from 0.97% to 1.35% copper, with separate veins
containing semi-massive iron sulphides, however no drilling was
carried out.
On 6 August 2023, Fulcrum Metals PLC, entered into a mineral
claim purchase agreement made between the Company, its wholly owned
subsidiary Fulcrum Metals Canada Limited ("FMCL"), and TSX-listed
1911 Gold Corp ("1911") to acquire a 100% interest in Tully Gold
Project located in Timmins, Ontario. Under the terms of the
Agreement, FMCL purchased all legal and beneficial interest from
Tully for a purchase price of CAD800,000 cash (the "Cash Purchase
Price"), plus a 1.5% net smelter return royalty (the "NSR Royalty")
in 1911's favour. The consent from the Ministry of Mines for the
transfer of the mining leases was obtained on 22 September 2023 and
the escrowed amount of CAD100,000 was then paid across to 1911.
Fulcrum Metals PLC raised GBP325,000 by the issue of unsecured
convertible loan notes (the "Loan Notes") to new and existing
shareholders (the "Subscribers"), and, in addition, certain
directors of the Company subscribed for GBP195,000 of Loan Notes
(the "Fundraising"). Following the subscriptions for Loan Notes by
such directors of the Company, the gross proceeds of the
Fundraising was GBP520,000. The net proceeds from the Fundraising
were used by the Company to satisfy the consideration due under the
Purchase Agreement, costs and for working capital needs.
During September 2023 as part of the pre-drilling activities at
the Tully Gold project the Company undertook site visits to the
Tully project area and to the sites that host historic paper
records, reject samples, pulp samples and drill core. The objective
was to confirm the condition of key access points to the Tully
project site and to establish location and accessibility of
historic drill core/samples for further test work ahead of the
proposed drilling programme this winter.
Following the site visits, the pre-drilling activities have now
commenced which includes comprehensive data reviews, 3D targeting,
further site visits, establishment of potential new collar
locations, reviewing historic drill holes and re-sampling of drill
core/reject material before finalising the drilling programme.
The exploration projects are at an early stage of development
and there are no JORC (Joint Ore Reserves Committee) or non-JORC
compliant resource estimates available to enable value in use
calculations to be prepared. The Directors therefore undertook an
assessment of the following areas and circumstances that could
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 for;
- 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 and production.
Following their assessment, the Directors concluded that no
impairment charge was required at 30 September 2023.
4. Cash and cash equivalents
30/09/2023 30/09/2022 31/12/2022
GBP GBP GBP
----------- ----------- --------------
Cash at bank and in hand 804,026 239,082 96,984
----------- --------------
All of the cash at bank is held with an institution with a
AA-credit rating.
5. Creditors: amounts falling due within one year
30/09/2023 30/09/2022 31/12/2022
GBP GBP GBP
Trade creditors 34,251 27,186 139,501
Other creditors 7,239 32,159 150,399
Accruals 57,562 7,064 356,539
99,052 66,409 646,439
=========== =========== ===========
6. Convertible loan notes
The convertible loan notes (the "2021 CLNs") were issued by
Fulcrum Metals Limited ("FML") on 19 November 2021 at an issue
price of GBP0.10 per note. The notes were convertible into ordinary
shares of FML at any time between the date of issue of the notes
and their settlement date. On 24 November 2022, the 2021 CLNs were
converted into 2,339,829 shares at GBP0.10 per share.
On 5 July 2022, 28 September 2022, and 17 October 2022 FML
issued CLNs to investors to raise funds of GBP453,463 at a
conversion price that was 70% of IPO share price (the "2022
CLNs").
On 8 February 2023, the 2022 CLNs issued by Fulcrum Metals
Limited to investors were cancelled and re-issued in the name of
Fulcrum Metals Plc, under a deed of surrender and cancellation
agreement entered into on 24 November 2022. Under this agreement
the 2022 Loan notes were cancelled and, in their place (and in
consideration of the creation of an inter-company debt of
GBP453,463 owed by FML to Fulcrum Metals plc), Fulcrum Metals plc
issued GBP453,463 of new loan notes. Subsequently, following the
IPO onto the AIM in London, the CLN holders exercised their right
to convert the loan notes to share capital under the loan note
agreement.
On 6 August 2023, Fulcrum Metals PLC issued convertible loan
notes (the "2023 CLNs) to investors to raise funds of GBP520,000 at
an issue price of GBP 1.00 per note. The notes are convertible into
ordinary shares of FM PLC if the trigger event conditions are met
prior to the expiry date of 31 July 2025. The trigger event
conditions will be met if the VWAP (Volume Weighted Average Price)
exceeding 24p for five consecutive Dealing Days. On the Conversion
Date, the principal amount of the Notes and all accrued but unpaid
interest on such principal amount up to the Conversion Date will
convert into such number of new fully paid Ordinary Shares, with
the conversion price of 18.5p.
The net proceeds received from the issue of the convertible loan
notes have been split between the financial liability element and
an equity component, representing the fair value of the embedded
option to convert the financial liability into equity of the
Company, as follows:
Convertible loan notes
30/09/2023 30/09/2022 31/12/2022
GBP GBP GBP
Opening Balance - 237,509 235,933
Convertible loan notes exercised (235,933)
Proceeds of issue of convertible loan notes 520,000 420,549 453,463
Net proceeds from issue of convertible loan
notes 520,000 658,058 453,463
Equity component 53,546 241,756 398,817
Amount classified as equity 53,546 241,756 398,817
Liability component due within one year - 479,468 113,366
Liability component due over one year 481,914 - -
Carrying amount of liability component at
30 September 2023 481,914 479,468 113,366
7. Share based payments
The fair value of the equity-settled warrants was determined by
the Binomial Option model, the parameters are defined below:
Equity-settled warrants
In February 2023, deeds of surrender and cancellation were
entered into in by each of the holders of the Investor Warrants and
Vendor Warrants with Fulcrum Metals Limited and Fulcrum Metals plc
pursuant to which each of the 1,169,915 Investor Warrants and the
118,862 Vendor Warrants were cancelled and, in their place, on
14(th) February 2023 Fulcrum Metals plc issued 1,169,915 New
Investor Warrants and 119,649 New Vendor Warrants pursuant to a new
investor warrant instrument and a new vendor warrant instrument to
subscribe for ordinary shares in the capital of the Company.
In consideration for the purchase of Big Bear, Fulcrum Metals
plc granted to PMCL: (i) a warrant to subscribe for Ordinary Shares
in the amount of GBP125,000, exercisable at the Placing Price
during the period of two years after Admission; and (ii) a warrant
to subscribe for Ordinary Shares in the amount of GBP125,000,
exercisable at 150 per cent. of the Placing Price during the period
of three years after Admission. A total of 1,190,476 warrants were
granted to PMCL.
2023 2023 2023
Granted on: 14/02/2023 14/02/2023 14/02/2023
Life (years) 2 years 3 years 2 years
Share price GBP 0.14 GBP 0.14 GBP 0.14
Exercise price - investor - - GBP 0.175
Exercise price - vendor GBP 0.175 GBP 0.2625 GBP 0.263
Total number of warrants granted 714,286 476,190 1,289,564
Risk free rate 1.95% 1.95% 1.95%
Expected volatility 65% 65% 65%
Expected dividend yield 0% 0% 0%
Total fair value GBP20,630 GBP13,753 GBP49,619
On 6 August 2023, Fulcrum Metals plc agreed to grant to Clear
Capital a total of 263,513 warrants over new ordinary shares in the
Company (being 15% of GBP325,000), with a value of GBP48,750,
exercisable at the warrant holders option at any time in the 3
years following completion of the placing.
The movement of warrants for the period ended 30 September 2023
is shown below:
Weighted Number of Weighted
Average Warrants average remaining
Exercise life contracted
Price
Clear Capital Vendor warrants GBP0.263 263,513 3 years
The total charge to the statement of changes in equity for the
period ended 30 September 2023 was GBP48,750 (30 September 2022:
GBP134,734, 31 December 2022: GBP97,202)
8. Share capital
31/03/2023 31/03/2022 31/12/2022
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Authorised
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
100,000,000
ordinary
shares
at EUR0.01
each 100,000,000 100,000,000 100,000,000
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Issued,
called up
and fully
paid:
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Number
of Ordinary Share Capital Share Premium Total
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Shares GBP GBP GBP
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 1 April
2022 - 117,367 49,555 166,922
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Issue of new
shares - 15,074 125,239 140,312
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 30
September
2022 - 132,441 174,974 307,234
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 1 January
2022 13,873,982 116,580 49,223 165,803
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Issue of new
shares 5,225,248 74,413 660,977 735,390
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 31
December
2022 19,099,230 190,993 710,200 901,193
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 1 April
2023 49,859,194 498,592 5,422,467 5,921,059
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
Issue of new
shares 101,749 1,017 17,806 18,823
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
At 30
September
2023 49,960,943 499,609 5,440,273 5,939,882
----------------------------------------------- --------------------------------------------- -------------------------------------------------- ----------------------------------------
All shares hold the same voting and dividend rights.
On 4 March 2022, the Company completed a placing of 291,667 new
ordinary shares of EUR0.01 at a price of EUR0.12 per ordinary
share, raising gross proceeds of GBP30,916.70 and increasing share
capital by GBP2,916.
On 28 April 2022, the Company completed a placing of 600,000 new
ordinary shares of EUR0.01 at a price of EUR0.01 per ordinary
share, raising gross proceeds of GBP6,000 and increasing share
capital by GBP6,000.
On 3 May 2022, the Company completed a placing of 791,668 new
ordinary shares of EUR0.01 at a price of EUR0.14 per ordinary
share, raising gross proceeds of GBP101,333.50 and increasing share
capital by
GBP7,917.
On 11 May 2022, the Company completed a placing of 33,334 new
ordinary shares of EUR0.01 at a price of EUR0.12 per ordinary
share, raising gross proceeds of GBP3,533.40 and increasing share
capital by GBP333.
On 6 October 2022, the Company completed a placing of 600,000
new ordinary shares of GBP0.01 at a price of GBP0.128 per ordinary
share, raising gross proceeds of GBP76,800 and increasing share
capital by GBP6,000.
On 26 October 2022, the Company completed a placing of 568,750
new ordinary shares of EUR0.01 at a price of EUR0.19 per ordinary
share, raising gross proceeds of GBP97,825 and increasing share
capital by
GBP5,687.
On 24 November 2022, the Company exercised the convertible loan
notes by completing a placing of 2,339,829 new ordinary shares of
EUR0.01 at a price of EUR0.12 per ordinary share, raising gross
proceeds of GBP235,933 and increasing share capital by
GBP23,398.
On 24 November 2022, the owners of the entire issued share
capital of FML (the "Transferors") each entered into a Share
Exchange Agreement with Fulcrum Metals plc and FML, pursuant to
which the Transferors transferred the FML Shares held by each of
them to the Company in return for consideration of GBP901,191.83,
which was satisfied by the issue and allotment of 19,099,230
Ordinary Shares in the capital of the Company to the Transferors
(credited as fully paid).
In February 2023 following admission to AIM and the IPO listing,
the company completed a placing of 16,571,429 new ordinary shares
of GBP0.01 at a price of GBP0.175 per ordinary share, raising gross
proceeds of GBP2.9 million and increasing share capital by
GBP165,714.
Upon the AIM listing additional shares of 614,285 ordinary
shares of GBP0.01 at a price of GBP0.175 per ordinary share were
also issued to the directors in settlement of loan GBP100,000 and
vendors GBP7,500 in lieu of services provided.
In consideration for the purchase of Big Bear, Fulcrum Metals
plc also allotted, on the closing date (immediately prior to
Admission), 9,971,839 ordinary shares of GBP0.01 (20 per cent. of
the total issued enlarged share capital on Admission) at a price of
GBP0.175 per ordinary share to Panther Metals Canada Limited.
On 14 February 2023, the convertible loan note holders exercised
their right to convert the loan notes to 3,602,411 ordinary shares
of GBP0.01 at a price of GBP0.1225 per ordinary share.
On 15 August 2023, Fulcrum Metals PLC issued 101,749 Ordinary
Shares of GBP0.01 at a price of GBP0.185 per ordinary share in part
settlement of the finder's fee owed to the introducer of the Tully
Project.
9. Events after the end of the reporting period
In October 2023, Fulcrum Metals Canada Limited ("FMCL"),
extended the Charlot-Neely Lake Uranium project by the staking of
three new claim blocks totalling 4,856 hectares (48.56km(2) ) (the
"Claim Cells") contiguous to and extending the Company's Charlot -
Neely Lake uranium-gold project ("Charlot-Neely" or the "Project")
in northern Saskatchewan to 12,481 hectares (124.81km(2) ) - a 63%
increase.
In November 2023, Fulcrum Metals Canada Limited ("FMCL"),
entered into an option agreement to acquire 11,480 hectares across
three Uranium properties at Snowbird, South Pendleton and Charlot
West from independent local prospectors, in addition to staking of
a new mining claim totalling 2,703 hectares extending the
Charlot-Neely Uranium project.
Fulcrum paid the vendors CA$5,000 in cash as consideration for
the option to acquire 100% of the properties, and, should the
option be exercised, will pay a further CA$60,000 either in cash or
in equity in Fulcrum Metals or a new uranium vehicle to be listed
on another recognised exchange. In the event that the CA$60,000 is
settled through the issue of new ordinary shares in Fulcrum Metals
this would be at a price per share based on the ten day volume
weighted average price of shares in Fulcrum Metals prior to
exercise. The option agreements have a close date of 30 June
2024.
Should the option be exercised and Fulcrum acquire a 100%
interest in the properties under option, the vendors shall retain a
royalty of 2% of the net smelter returns on three of the mining
claims (MC00017090, MC00017453 and MC00017455) subject to the
option agreement. Fulcrum have the right to buy back half of the
net smelter royalty for CA$1,000,000 at any time.
Fulcrum is reviewing its options with interested parties with
regards to its uranium properties in Saskatchewan. These options
include, but are not limited to, a potential spin out of the
Saskatchewan assets as a separate business listed on a recognised
exchange and other partnerships. Discussions remain at an early
stage and further details will be announced at the appropriate
time.
In November 2023, Fulcrum Metals Canada Limited ("FMCL"),
entered into an option agreement to acquire the Teck Hughes Gold
Tailings project, Kirkland Lake, Ontario. In consideration for the
grant of the option Fulcrum shall make payments of CA$15,000 within
10 business days of signing the Mining Option Agreement, CA$25,000
within 10 business days upon receipt by Fulcrum of a mineral
recovery permit from the Ministry of Mines in Ontario, CA$250,000
on or before the first agreement anniversary date of the Mining
Option Agreement and CA$250,000 on or before the anniversary date
of the Mining Option Agreement.
Should the option be exercised, and Fulcrum acquire a 100%
interest in the properties under option, Fulcrum will grant the
vendors a 3% net smelter royalty. Fulcrum has an option to purchase
1.5% of the net smelter royalty (thereby reducing the net smelter
royalty payable to the Options from 3% to 1.5%) for CA$1,500,000
with an additional option to purchase a further 0,5% of the
original NSR Royalty (thereby reducing the net smelter royalty
payable to Optioners from 1.5% to 1.0%) for a further CA$1,000,000
at any time or from time to time, after the net smelter royalty has
been granted.
In parallel with the Mining Option Agreement, Fulcrum is in
advanced discussions with Extrakt Process Solutions ("Extrakt"),
regarding the licensing of its proprietary technology. Extrakt is a
sustainable technology company using separation technology to
extract metals from tailings without the use of cyanide.
The Directors are not aware of any events or circumstances
arising which had not been dealt with in this Report which may have
a significant impact on the Company.
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END
IR FEMEFWEDSELE
(END) Dow Jones Newswires
December 28, 2023 02:00 ET (07:00 GMT)
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