TIDMCOBR

RNS Number : 5593D

Cobra Resources PLC

30 June 2021

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"), AND IS DISCLOSED IN ACCORDANCE WITH THE COMPANY'S OBLIGATIONS UNDER ARTICLE 17 OF MAR.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

30 June 2021

Cobra Resources plc

("Cobra" or the "Company")

Final Results for the Year Ended 31 December 2020

Cobra, the gold explorer focused on the Wudinna Gold Project in South Australia, announces its final results for the year ended 31 December 2020 .

Key highlights:

-- Strengthened existing board with the appointment of two new Non-Executive Directors, David Clarke and Daniel Maling, in April 2020

-- Executed a successful exploration campaign during the first half of 2020, with 5,185 samples analysed for broad multi-element suite, with this extensive dataset providing excellent information to target priority drilling areas

-- Successfully raised GBP1.5m to progress drilling in the second half of 2020, driven by increased confidence in the planned drilling targets gained from the pathfinder strategy

-- Undertook a further drilling programme that completed in November 2020, focused on testing the orientation and continuity of mineralisation at the Baggy Green, Clarke and Barns deposits

o The total drilling programme included 41 holes for 6,090 metres

o The drilling programme satisfied the Stage 1 Earn in obligations, such that Cobra now holds a 50% beneficial interest in the Wudinna Gold Project

Greg Hancock, Chairman of Cobra, commented:

" The Company has delivered some very strong progress over the course of the period that position us for a hugely exciting next phase which is now underway. I thank my fellow directors for their contribution throughout the year, Craig Moulton our Managing Director for his commitment, and our shareholders generally for their support. We look forward to a period of significant activity which lies in front of us."

The full financial statements can be viewed on the Company website: https://cobraplc.com/category/financial-reports/

Enquiries:

 
Cobra Resources plc                             Via Vigo Consulting 
 Craig Moulton (Australia)                      +44 (0)20 7390 0234 
 Dan Maling (UK) 
SI Capital Limited (Joint Broker) 
 Nick Emerson 
 Sam Lomanto                                    +44 (0)1483 413 500 
Peterhouse Capital Limited (Joint Broker) 
 Duncan Vasey 
 Lucy Williams                                  +44 (0)20 7469 0932 
Vigo Consulting (Financial Public Relations) 
 Ben Simons 
 Fiona Hetherington                             +44 (0)20 7390 0234 
 

About Cobra

Cobra's Wudinna Gold Project is located in the Gawler Craton which is home to some of the largest IOCG discoveries in Australia including Olympic Dam, as well as Prominent Hill and Carrapateena. Cobra's Wudinna tenements contain extensive orogenic gold mineralisation and are characterised by potentially open-pitable, high-grade gold intersections, with ready access to nearby infrastructure. In total Cobra has over 22 orogenic gold prospects, with grades of between 16 g/t up to 37.4 g/t outside of the current 211,000 oz JORC resource, as well as one copper-gold prospect, and four IOCG targets.

Wudinna Project Description

The Eyre Peninsula Gold Joint Venture comprises a 1,928 km(2) land holding in the Gawler Craton. The Wudinna Gold Project within the Joint Venture tenement holding comprises a cluster of gold prospects which includes the Barns, White Tank and Baggy Green deposits.

Chairman's statement

INTRODUCTION

2020 will be remembered as a challenging year, profoundly impacting the lives of many people. The pandemic also impacted both equity and commodity markets, resulting in strong demand for safehaven commodities such as gold and copper, reflected through strong support for precious and base metals explorers on the London Stock Exchange. During the year, Cobra raised sufficient funds to conduct three detailed soil programmes, and then test priority targets via a significant Reverse Circulation (RC) drilling programme. The results of this drilling, particularly at Clarke, were spectacular, realising one of the largest high-grade intercections in the Wudinna Gold Projects' history.

BACKGROUND

Cobra Resources began life as publicly listed company with the aim of finding suitable precious, base or energy metals exploration or mining projects in either Australia or Africa. During 2019 the Board identified several potentially suitable projects, which were reviewed in detail to evaluate their strengths, growth potential and likely longer-term value to shareholders.

Following an extensive due diligence process, the Wudinna Gold Project was identified as the most compelling opportunity primarily due to its technical and commercial merits which could be efficiently explored and grown with Cobra's infrastructure and skilled resources. This included having an existing gold resource of over 200,000 ounces with significant upside potential, being located in a jurisdiction that was stable, with low sovereign risk, and having a large number of prospects which could be efficiently explored and expanded with Cobra's infrastructure and skilled resources.

The Group has retained a team with the core competencies required to deliver on its strategic objectives. During the course of 2020, the Company sought to strengthen the existing board with the appointment of two new members:

-- David Clarke - Non-Executive Director. David is an eminent and renowned geologist, responsible for the discovery of Tuckabianna amongst others. David is tasked with providing technical oversight.

-- Daniel Maling - Non-Executive Director. Daniel has extensive commercial and business development experience in the oil & gas, mining and technology sectors.

OPERATIONAL REVIEW

The Company's articulated strategy to utilise staged geochemical sampling to identify priority targets as a means to reduce risk was demonstrably successful during the 2020 exploration campaign. These initial three programmes focused on:

Programme 1 : Calibration of surface and drillhole geochemistry to characterise primary immobile pathfinder elements directly associated with mineralisation.

Programme 2 : Collection of surface samples and re-analysis of historic surface and drillhole pulps to charaterise the orientation and extension of existing brownfields resources.

Programme 3 : Re-analysis of historic surface pulps to charaterise priority areas for greenfields discoveries.

In total 5,185 samples were analysed for a broad multi-element suite, with this extensive dataset providing excellent information to target priority drilling areas. With increased confidence in the planned drilling targets gained from this pathfinder strategy, the Company then raised GBP1.5m to progress the drilling during the second half of 2020.

Drilling commenced at Wudinna on 23(rd) September 2020 . Four primary drilling areas were planned, focusing on testing the orientation and continuity of mineralisation at the Baggy Green, Clarke, Laker and Barns deposits. Unfortunately access conditions meant that the Laker drilling did not proceed, and was deferred.

The total drilling programme of included 41 holes for 6,090 metres and was completed by 14th November 2020. Following some assay laboratory and Christmas holiday delays the company was able to report the following signature intersections post year end:

                                   1. CBRC009        31m @ 3.06g/t from 69m inc. 15m @ 5.25 g/t 
                                   2. CBRC008        16m @ 1.37g/t from 43m inc. 4m @ 4.19 g/t 
                                   3. CBRC027        37m @ 1.38g/t from 151m inc. 13m @ 3.25g/t 
                                   4. CBRC026        6m @ 2.3g/t from 85m inc. 1m @ 8.72g/t 

The drilling programme satisfied the Stage 1 Earn In obligations such that Cobra now holds a 50% beneficial interest in the Wudinna Gold Project.

POST PERIOD EVENTS

On 11 January 2021, the Company issued a total of 32,383,152 new ordinary shares pursuant to completion of Stage 1 earn-in of the Wudinna Gold Project, with 31,049,819 shares at 2.4 pence per share being issued in accordance with the acquisition agreement to the vendors of Lady Alice Trust and Lady Alice Mines Pty Ltd, and 1,333,333 shares at 1.5 pence per share issued to the Company's CEO in accordance with the terms of his service agreement.

On 28 January 2021, the Company issued 1,934,800 new ordinary shares pursuant to the exercise of warrants, with 934,800 shares at a price of 3 pence per share and 1,000,000 shares at a price of 2 pence per share.

On 18 and 19 of February 2021, the Company issued 2,333,334 new ordinary shares and 1,666,667 new ordinary shares respectively, at 2 pence per share, pursuant to the exercise of warrants.

On 29 April 2021, the Company issued a total of 7,110,053 new ordinary shares, with 5,664,340 shares being issued at 1 pence per share to the vendors of Lady Alice Trust and Lady Alice Mines Pty Ltd in accordance with the acquisition agreement for the Wudinna Gold Project, and 1,445,713 shares at 2.3 pence per share to a drilling contractor in settlement of a contractual agreement in respect of the provision of service.

COVID-19

On 11 March 2020, the World Health Organisation declared the Coronavirus outbreak to be a pandemic in recognition of its rapid spread across the globe, with over 200 countries now affected. Many governments are taking increasingly stringent steps to help contain or delay the spread of the virus and as a result there is a significant increase in economic uncertainty.

For the Group's 31 December 2020 financial statements, the Coronavirus outbreak and the related impacts are considered non-adjusting events. Consequently, there is no impact on the recognition and measurement of assets and liabilities. Due to the uncertainty of the outcome of current events, the Group cannot reasonably estimate the impact these events will have on the Group's financial position, results of operations or cash flows in the future.

CONCLUSION

Despite the challenges presented in 2020, the Company has delivered some very strong progress over the course of the period that position us for a hugely exciting next phase which is now underway. I thank my fellow directors for their contribution throughout the year, Craig Moulton our Managing Director for his commitment, and our shareholders generally for their support. We look forward to a period of significant activity which lies in front of us.

Greg Hancock

Chairman

29 June 2021

CONSOLIDATED INCOME STATEMENT

For the year ended 31 December 2020

 
                                                   Notes  31 December  31 December 
                                                                 2020         2019 
                                                                  GBP          GBP 
Other Income                                                   50,280            - 
Other Expenses                                              (895,684)    (544,500) 
IPO expenses                                                        -    (124,400) 
Operating loss                                       2      (845,404)    (668,900) 
Finance income and costs                                            -            - 
Change in estimate of contingent consideration      13      (161,346)            - 
Loss before tax                                           (1,006,750)    (668,900) 
Taxation                                             5              -            - 
Loss for the year attributable to equity holders          (1,006,750)    (668,900) 
                                                          ===========  =========== 
 
  Earnings per ordinary share 
Basic and diluted loss per share attributable             (GBP0.0035)  (GBP0.0099) 
 to owners of the Parent Company                     6 
                                                          ===========  =========== 
 

All operations are considered to be continuing.

The accompanying notes are an integral part of these financial statements.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2020

 
                                                               31 December  31 December 
                                                                      2020         2019 
                                                                       GBP          GBP 
                                                                              ( 668,900 
Loss for the year                                              (1,006,750)            ) 
Other Comprehensive income 
 Items that may subsequently be reclassified 
 to profit or loss: 
 
        *    Exchange differences on translation of foreign 
             operations                                             66,916     (1,461 ) 
Total comprehensive loss attributable                                         ( 670,361 
 to equity holders of the Parent Company                         (939,834)            ) 
                                                               ===========  =========== 
 
The accompanying notes are an integral 
 part of these financial statements. 
 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

31 December 2020

 
                                Notes 
                                              2020         2019 
                                               GBP          GBP 
Non-current assets 
Intangible Fixed Assets           8      1,495,519      612,242 
Property, plant and equipment     9          2,400        3,428 
Total non-current assets                 1,497,919      615,670 
                                       -----------  ----------- 
 
Current assets 
Trade and other receivables      10         69,408       37,433 
Cash and cash equivalents        11      1,338,851        7,675 
                                       -----------  ----------- 
Total current assets                     1,408,259       45,108 
                                       -----------  ----------- 
 
Non-current liabilities 
Deferred consideration           13      (322,691)    (350,066) 
                                       -----------  ----------- 
Current liabilities 
Trade and other payables         12      (169,314)    (436,553) 
Deferred consideration           13      (188,721)    (215,486) 
Total current liabilities                (358,035)    (652,039) 
                                       -----------  ----------- 
 
Net assets/(liabilities)                 2,225,451    (341,327) 
                                       ===========  =========== 
 
Capital and reserves 
Share capital                    14      2,829,566      672,335 
Share premium account                      564,173      160,992 
Share based payment reserve              1,006,239       69,038 
Retained losses                        (2,239,982)  (1,242,231) 
Foreign currency reserve                    65,456      (1,461) 
                                       -----------  ----------- 
Total equity                             2,225,451    (341,327) 
                                       ===========  =========== 
 

The accompanying notes are an integral part of these financial statements.

These financial statements were approved and authorised for issue by the Board of Directors on 29 June 2021.

Signed on behalf of the Board of Directors

Craig Moulton , Executive Director , Company No. 11170056

COMPANY STATEMENT OF FINANCIAL POSITION

31 December 2020

 
                                Notes 
                                              2020         2019 
                                               GBP          GBP 
Non-current assets 
Investment in subsidiary          7        432,260      432,260 
Property, plant and equipment     9          2,400        3,428 
Intangible Fixed Assets           8         33,251            - 
Total non-current assets                   467,910      435,688 
                                       -----------  ----------- 
 
Current assets 
Trade and other receivables      10      1,636,477      241,518 
Cash and cash equivalents        11        834,164        1,749 
                                       -----------  ----------- 
Total current assets                     2,470,641      243,267 
                                       -----------  ----------- 
 
Non-current liabilities 
Deferred consideration           13      (322,691)    (350,066) 
                                       -----------  ----------- 
Total Non-current liabilities            (322,691)    (350,066) 
                                       -----------  ----------- 
Current liabilities 
Trade and other payables         12       (95,636)    (422,560) 
Deferred consideration           13      (188,721)    (215,486) 
Total current liabilities                (284,357)    (638,046) 
                                       -----------  ----------- 
 
Net assets/(liabilities)                 2,331,502    (309,157) 
                                       ===========  =========== 
 
Capital and reserves 
Share capital                    14      2,829,566      672,335 
Share premium account                      564,173      160,992 
Share based payment reserve              1,006,239       69,038 
Retained losses                        (2,068,475)  (1,211,522) 
Equity shareholders' funds               2,331,502    (309,157) 
                                       ===========  =========== 
 

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not included its own income statement and statement of comprehensive income in these financial statements. The Company's loss for the period amounted to GBP878,753 (2019: GBP638,190 loss).

The accompanying notes are an integral part of these financial statements.

These financial statements were approved and authorised for issue by the Board of Directors on 29 June 2021.

Signed on behalf of the Board of Directors

Craig Moulton, Executive Director, Company No. 11170056

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2020

 
                                      Share        Share  Share based     Retained   Foreign         Total 
                                    capital      premium      payment       losses  currency 
                                                              reserve                reserve 
 
                                        GBP          GBP          GBP          GBP       GBP             GBP 
 
As at 1 January 2019                672,335      160,992       69,038    (573,332)         -         329,034 
Loss for the year                         -            -            -    (668,900)         -       (668,900) 
Translation differences                   -            -            -            -   (1,461)         (1,461) 
                                  ---------  -----------  -----------  -----------  --------  -------------- 
Comprehensive loss for the year           -            -            -    (668,900)   (1,461)       (670,361) 
                                  ---------  -----------  -----------  -----------  --------  -------------- 
At 31 December 2019                 672,335      160,992       69,038  (1,242,232)   (1,461)       (341,327) 
 
Loss for the year                         -            -            -  (1,006,750)         -     (1,006,750) 
Translation differences                   -            -            -            -    66,917         66,917 
                                  ---------  -----------  -----------  -----------  --------  -------------- 
Comprehensive loss for the year           -            -            -  (1,006,750)    66,917       (939,834) 
Shares issued                     2,157,231    1,537,142            -            -         -       3,694,373 
Share based payment expired               -            -      (3,833)        3,833         -               - 
Exercise of options & warrants            -            -     (17,967)        5,167         -        (12,800) 
Cost of share issue                       -  (1,133,961)            -            -         -     (1,133,961) 
Share warrant charge                      -            -      947,000            -         -         947,000 
Share option charge                       -            -       12,000            -         -          12,000 
At 31 December 2020               2,829,566      564,173    1,006,238  (2,239,982)    65,456       2,225,451 
                                  ---------  -----------  -----------  -----------  --------  -------------- 
 

The following describes the nature and purpose of each reserve within equity:

   Share capital:                                       Nominal value of shares issued 

Share premium: Amount subscribed for share capital in excess of nominal value, less share issue costs

   Share based payment reserve:          Cumulative fair value of warrants and options granted 

Retained losses: Cumulative net gains and losses, recognised in the statement of comprehensive income

Foreign currency reserve: Gains/losses arising on translation of foreign controlled entities into pounds sterling.

The accompanying notes are an integral part of these financial statements.

COMPANY STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2020

 
                                        Share        Share        Share based     Retained        Total 
                                      capital      premium            payment       losses 
                                                                      reserve 
 
                                          GBP          GBP                GBP          GBP          GBP 
 
At 1 January 2019                     672,335      160,992             69,038    (573,332)      329,034 
Loss for the year                           -            -                  -    (638,190)    (638,190) 
Translation differences                     -            -                  -            -            - 
                                    ---------  -----------  -----------------  -----------  ----------- 
Comprehensive loss for the period           -            -                  -    (638,190)    (638,190) 
                                    ---------  -----------  -----------------  -----------  ----------- 
At 31 December 2019                   672,335      160,992             69,038  (1,211,522)    (309,157) 
 
Loss for the year                           -            -                  -    (878,753)    (878,753) 
Translation differences                     -            -                  -            -            - 
Shares issued                       2,157,231    1,537,142                  -            -    3,694,373 
Share based payment expired                 -            -            (3,833)        3,833            - 
Exercise of options & warrants              -            -           (17,967)       17,967            - 
Cost of share issue                         -  (1,133,961)                  -            -  (1,133,961) 
Share warrant charge                        -            -            947,000            -      947,000 
Share option charge                         -            -             12,000            -       12,000 
At 31 December 2020                 2,829,566      564,173          1,006,238  (2,068,475)    2,331,502 
                                    ---------  -----------  -----------------  -----------  ----------- 
 

The following describes the nature and purpose of each reserve within equity:

   Share capital:                                       Nominal value of shares issued 

Share premium: Amount subscribed for share capital in excess of nominal value, less share issue costs

   Share based payment reserve:          Cumulative fair value of warrants and options granted 

Retained losses: Cumulative net gains and losses, recognised in the statement of comprehensive income

The accompanying notes are an integral part of these financial statements.

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 December 2020

 
                                                              Notes  31 December  31 December 
                                                                            2020         2019 
                                                                             GBP          GBP 
 
Cash flows from operating activities 
Loss before tax                                                      (1,006,750)    (668,900) 
Equity settled share based payments                                      265,189            - 
Depreciation                                                    9          1,028          979 
Foreign exchange                                                          66,916        5,950 
Change in estimate of contingent consideration                 13        161,346            - 
(Decrease) / Increase in trade and other receivables           10       (31,975)      (9,286) 
Increase in trade and other payables                           12      (482,725)      313,519 
Share warrant charge                                                           -            - 
Net cash used in operating activities                                (1,026,971)    (357,738) 
                                                                     -----------  ----------- 
 
Cash flows from investing activities 
Payments for exploration and evaluation activities              8      (883,277)      (5,660) 
Payment for acquisition of subsidiary, net of cash acquired    17              -       11,645 
Payments for tangible fixed assets                              9              -      (4,407) 
Net cash used in investing activities                                  (883,277)        1,578 
                                                                     -----------  ----------- 
 
Cash flows from financing activities 
Proceeds from the issue of shares                                      3,428,384       35,700 
Cost of shares issued                                                  (186,961)            - 
Net cash generated from financing activities                           3,241,423       35,700 
                                                                     -----------  ----------- 
 
Net increase/(decrease) in cash and cash equivalents                   1,331,176    (320,460) 
Cash and cash equivalents at beginning of year                             7,675      328,135 
Cash and cash equivalents at end of year                       11      1,338,851        7,675 
                                                                     ===========  =========== 
 

-- During the year, Shares worth GBP168,819 were issued to the previous Lady Alice Mines unit holders as per the sale agreement.

-- During the year, Liabilities (Broker Fees) worth GBP186,960 were offset against share proceeds.

   --    During the year, Shares worth GBP96,370 were issued to Directors in Lieu of fees. 

The accompanying notes are an integral part of these financial statements

COMPANY CASH FLOW STATEMENT

For the year ended 31 December 2020

 
                                                         Notes  31 December  31 December 
                                                                       2020         2019 
                                                                        GBP          GBP 
 
Cash flows from operating activities 
Loss before tax                                                   (878,753)    (638,190) 
Equity settled share based payments                                 265,189            - 
Depreciation                                               9          1,028          979 
Foreign exchange loss/gain                                           12,801            - 
Change in estimate of contingent consideration            13        161,346            - 
Increase in trade and other receivables                   10    (1,394,958)      (4,958) 
Increase in trade and other payables                      12      (542,410)      359,611 
Share warrant charge                                                      -            - 
Net cash used in operating activities                           (2,375,757)    (282,558) 
                                                                -----------  ----------- 
 
Cash flows from investing activities 
Payments for tangible fixed assets                         9              -      (4,407) 
Payments for Intangible fixed assets                               (33,251)            - 
Investment in subsidiary                                   7              -        (535) 
Net cash used in investing activities                              (33,251)      (4,942) 
                                                                -----------  ----------- 
 
Cash flows from financing activities 
Proceeds from the issue of shares                                 3,428,384       35,700 
Cost of shares issued                                             (186,961)            - 
Loan to subsidiary company                                10              -     (74,586) 
Net cash (used in)/generated from financing activities            3,241,423     (38,886) 
                                                                -----------  ----------- 
 
Net increase/(decrease) in cash and cash equivalents                832,415    (326,386) 
Cash and cash equivalents at beginning of year                        1,749      328,135 
Cash and cash equivalents at end of year                  11        834,164        1,749 
                                                                ===========  =========== 
 

NOTES TO THE FINANCIAL STATEMENTS

   1.         ACCOUNTING POLICIES AND BASIS OF PREPARATION 
   General   information 

The Group is a public company limited by shares which is incorporated in England. The registered office of the Company is 9(th) Floor, 107 Cheapside, London, EC2V 6DN, United Kingdom. The registered number of the Company is 11170056.

The principal activity of the Group is to objective is to explore, develop and mine precious and base metal projects .

Summary of significant accounting policies

The principal accounting policies applied in the preparation of these Financial Statements are set out below ('Accounting Policies' or 'Policies'). These Policies have been consistently applied to all the periods presented, unless otherwise stated.

Accounting policies

Basis of preparation of Financial Statements

The Group and Company Financial Statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the the European Union and as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006 . The Group and Company Financial Statements have also been prepared under the historical cost convention, except as modified for assets and liabilities recognised at fair value on an asset acquisition.

The Financial Statements are presented in pounds sterling, which is the functional currency of the Parent Company. The functional currency of Lady Alice Mines Pty Ltd is Australian Dollars.

The preparation of the Financial Statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires the Board to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Statements are disclosed in Note 1.

Changes in accounting policies

New and amended standards adopted

The adoption of the new or amended standards and interpretations did not result in any significant changes to the Group's and Company's accounting policies.

Amendments to IFRS

The group and company applied for the first-time certain standards and amendments, which are effective for annual periods beginning on or after 1 January 2020. The group and company has not early adopted any other standard, interpretation or amendment that that been issued but is not yet effective. The nature and effect of these changes as a result of the adoption of these new standards are described below. Other than the changes described below, the accounting policies adopted are consistent with those of the previous financial year.

Amendments to IFRS 3: Definition of a Business

The amendment to IFRS 3 Business Combination clarifies that to be considered a business, an integrated set of activities and assets must include, at a minimum, an input, and a substantive process that, together, significantly contribute to the ability to create output. Furthermore, it clarifies that a business can exist without including all the inputs and processes needed to create outputs. These amendments had no impact on the financial statements of the Company but may impact future periods should the Company enter into any business combinations.

Amendments to IAS 1 and IAS 8 Definition of Material

The amendments provide a new definition of material that states, "information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity." The amendments clarify that materiality will depend on the nature or magniture of information, either individually or in combination with other information, in the context of the financial statements. A misstatement of information is material if it could reasonably be expected to influence decisions made by the primary users. These amendments had no impact on the financial statements of, nor is there expected to be any future impact to the Group or Company.

Conceptual Framework for Financial Reporting

The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standards in place and to assist all parties to understand and interpret the standards. This will affect those entities which developed their accounting policies based on the Conceptual Framework. The revised Conceptual Framework includes some new concepts, updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments had no impact on the financial statements of the Group or Company.

Going concern

The Financial Statements have been prepared on a going concern basis. In assessing whether the going concern assumption is appropriate, the Directors have taken into account all relevant available information about the current and future position of the Group and Company, including current level of resources and the required level of spending on exploration and evaluation activities. As part of their assessment, the Directors have also taken into account the ability to raise additional funding whilst maintaining sufficient cash resources to meet all commitments.

The Group meets its working capital requirements from its cash and cash equivalents. The Company is pre-revenue, and to date the Company has raised finance for its activities through the issue of equity and debt. The Directors have reviewed the cash flow forecasts and are satisfied that there are sufficient funds to meet planned project expenditure and overheads through to July 2022 the Group and Company have sufficient funds to meet their working capital needs for a period of at least 12 months from the date of approval of these financial statements. Further funding will be required either through equity raisings or other financial arrangements to fund future exploration activities and this additional funding is not guaranteed however to date the Company has been successful in securing funding when required. Exploration and evaluation will be curtailed, if necessary, in order to preserve cash for working capital purposes.

At present the Group believes that there should be no significant material disruption to its operations from COVID-19 in the near term, but the Board continues to monitor these risks and the Group's business continuity plans.

Having prepared forecasts based on current resources, assessing methods of obtaining additional finance and assessing the possible impact of COVID-19, the Directors believe the Group has sufficient resources to meet its obligations for a period of 12 months from the date of approval of these financial statements. Taking these matters into consideration, the Directors continue to adopt the going concern basis of accounting in the preparation of the financial statements. The financial statements do not include the adjustments that would be required should the going concern basis of preparation no longer be appropriate.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Parent Company and companies controlled by the Parent Company, the Subsidiary Companies, drawn up to 31 December each year.

Control is recognised where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities, and is exposed to, or has rights to, variable returns from its involvement in the subsidiary. The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, where appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

The Group applies the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

Acquisition-related costs are expensed as incurred unless they result from the issuance of shares, in which case they are offset against the premium on those shares within equity.

Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity.

Investments in subsidiaries are accounted for at cost less impairment.

Segmental reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.

The Group's operations are located Australia with the head office located in the United Kingdom. The main tangible assets of the Group, cash and cash equivalents, are held in the United Kingdom and Australia. The Board ensures that adequate amounts are transferred internally to allow all companies to carry out their operational on a timely basis.

The Directors are of the opinion that the Group is engaged in a single segment of business being the exploration of gold in Australia. The Group currently has two geographical reportable segments - United Kingdom and Australia.

   Foreign   currencies 

For the purposes of the consolidated financial statements, the results and financial position of each Group entity are expressed in pounds sterling, which is the presentation currency for the consolidated financial statements.

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 at the dates of the transactions. At each reporting date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the reporting date. Exchange differences arising are included in the profit or loss for the period.

For the purposes of preparing consolidated financial statements, the assets and liabilities of the Group's foreign operations are translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period. Gains and losses from exchange differences so arising are shown through the Consolidated Statement of Changes in Equity.

Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is provided on all property, plant and equipment to write off the cost less estimated residual value of each asset over its expected useful economic life on a straight-line basis at the following annual rates: Office Equipment: 33.33% per annum

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within 'Other (losses)/gains' in the Statement of Comprehensive Income.

Impairment of tangible fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.

Intangible assets

Exploration and evaluation assets

Exploration and evaluation assets comprises all costs which are directly attributable to the exploration of a project area. 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 recorded at fair-value on acquisition

Exploration assets which are acquired are recognised at fair value. When an acquisition of an entity whose only significant assets are its exploration asset and/or rights to explore, the Directors consider that the fair value of the exploration assets is equal to the consideration. Any excess of the consideration over the capitalised exploration asset is attributed to the fair value of the exploration asset.

Impairment of intangible assets

Intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised in profit or loss for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Early stage exploration projects are assessed for impairment using the methods specified in IFRS 6.

Financial Assets

Loans and Receivables

(a) Classification and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an instrument level.

The Group's and Company's business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both.

Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in four categories:

   --     financial assets at amortised cost (debt instruments); 

-- financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments);

-- financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments); and

   --     financial assets at fair value through profit or loss. 

Financial assets at amortised cost (debt instruments)

This category is the most relevant to the Group and Company. The Group and Company measure financial assets at amortised cost if both of the following conditions are met:

-- the financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and

-- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at amortised cost are subsequently measured using the effective interest rate ("EIR") method and are subject to impairment. Interest received is recognised as part of finance income in the statement of profit or loss and other comprehensive income. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. The Group's and Company's financial assets at amortised cost include trade and other receivables (not subject to provisional pricing) and cash and cash equivalents.

Derecognition

A financial asset is primarily derecognised when:

   --     the rights to receive cash flows from the asset have expired; or 

-- the Group and Company have transferred their rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either (a) the Group and Company have transferred substantially all the risks and rewards of the asset, or (b) the Group and Company have neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

Impairment of financial assets

The Group and Company recognise an allowance for expected credit losses ("ECLs") for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group and Company expect to receive, discounted at an approximation of the original EIR. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

Financial liabilities

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

Subsequent measurement

After initial recognition, trade and other payables are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in the statement of profit or loss and other comprehensive income when the liabilities are derecognised, as well as through the EIR amortisation process.

Derecognition

A financial liability is derecognised when the associated obligation is discharged or cancelled or expires.

Cash and cash equivalents

The Company considers any cash on short-term deposits and other short-term investments to be cash and cash equivalents.

Share capital

The Company's ordinary shares of nominal value GBP0.01 each ("Ordinary Shares") are recorded at such nominal value and proceeds received in excess of the nominal value of Ordinary Shares issued, if any, are accounted for as share premium. Both share capital and share premium are classified as equity. Costs incurred directly to the issue of Ordinary Shares are accounted for as a deduction from share premium, otherwise they are charged to the income statement.

Current and deferred income tax

Tax represents income tax and deferred tax. Income tax is based on profit or loss for the year. Taxable profit or loss differs from the loss for the year 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 it further excludes items of income or expense that are never taxable or deductible. The liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the Statement of Financial Position date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the Historical Financial Information and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the intention is to settle current tax assets and liabilities on a net basis.

Share based payments

The fair value of services received in exchange for the grant of share warrants is recognised as an expense in share premium or profit or loss, in accordance with thenature of the service provided. A corresponding increase is recognised in equity.

   Judgements   and   key   sources   of   estimation   uncertainty 

The preparation of the Financial Statements in conformity with IFRS requires the directors to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Accounting estimates and assumptions are made concerning the future and, by their nature, may not accurately reflect the related actual outcome. Share options and warrants are measured at fair value at the date of grant. The fair value is calculated using the Black Scholes method for both options and warrants as the management views the Black Scholes method as providing the most reliable measure of valuation.

Contingent consideration, resulting from business combinations, is valued at fair value at the acquisition date as part of the business combination. The determination of fair value is based on key assumptions involving estimation of the probability of meeting each performance target and the timing thereof. As part of the acquisition of Lady Alice Mines Pty Ltd, contingent consideration with an estimated fair value of GBP296,536 was recognised at the acquisition date. See note 17 for further details. The Group is required to remeasure the contingent liability at fair value at each reporting date with changes in fair value recognised in accordance with IFRS 9. Therefore, as at 31 December 2020, the contingent consideration reflects an estimated fair value of GBP322,691.

   2.         EXPENSES BY NATURE 
 
                                                31 December  31 December 
                                                       2020         2019 
                                                        GBP          GBP 
This is stated after charging/(crediting): 
Administrative expense                               93,171       85,964 
Corporate expense                                   488,450      275,327 
Finance expense                                      39,755     (19,017) 
Other Income                                       (50,280)            - 
Professional fees                                     2,833            - 
Wages & Salaries expense                            271,477      326,626 
                                                    845,404      668,900 
                                              =============  =========== 
 

* Amounts payable to PKF Littlejohn LLP by the Company in respect of non-audit services was GBPnil (2019: GBP25,600) net of VAT in relation to work as reporting accountants for listing on the main market of the London Stock Exchange.

   3.         SEGMENT INFORMATION 

The Group's prime business segment is mineral exploration.

The Group operates within two geographical segments, the United Kingdom and Australia. The UK sector consists of the parent company which provides administrative and management services to the subsidiary undertaking based in Australia.

The following tables present expenditure and certain asset information regarding the Group's geographical segments for the years ended 31 December 2020 and 2019:

 
 Operational Results     31 December   31 December 
                                2020          2019 
                                 GBP           GBP 
---------------------   ------------  ------------ 
 Revenue                           -             - 
---------------------   ------------  ------------ 
 Loss after taxation 
 - United Kingdom          (878,753)     (638,190) 
 - Australia               (127,997)      (30,170) 
----------------------  ------------  ------------ 
 Total                   (1,006,750)     (668,900) 
----------------------  ------------  ------------ 
 
 
 2020                   Australia   United Kingdom         Total 
                              GBP              GBP           GBP 
--------------------   ----------  ---------------  ------------ 
 Non-current assets     1,495,519            2,400     1,497,919 
 Current assets           574,953          833,306     1,408,259 
 Total liabilities       (73,678)        (607,048)     (680,726) 
 
 
 2019 
 
 Non-current assets       612,242            3,428       615,670 
 Current assets            10,254           34,854        45,108 
 Total liabilities       (13,993)        (988,112)   (1,002,105) 
 
 
 
   4.         DIRECTORS' EMOLUMENTS 

There were no employees during the period apart from the directors, who are the key management personnel. No directors had benefits accruing under money purchase pension schemes.

 
                                                        Share Based 
Year ended 31 December   Remuneration     Fees  Bonus       payment    Total 
 2020                             GBP      GBP    GBP           GBP      GBP 
-----------------------  ------------  -------  -----  ------------  ------- 
C Moulton                     128,539        -      -        51,188  179,727 
R Gerritsen                         -    6,121      -        12,000   18,121 
G Hancock                           -   22,167      -             -   22,167 
D Maling                       10,584    3,000      -             -   13,584 
D Clarke                            -   13,667      -             -   13,667 
-----------------------  ------------  -------  -----  ------------  ------- 
                              139,123   44,955      -        63,188  247,266 
-----------------------  ------------  -------  -----  ------------  ------- 
 

-- During the year GBP179,727 (2019: GBP118,500) was paid to Craig Moulton in respect of Wages & Salaries and Share based payments. The share based payments include GBP21,188 for 2,118,750 shares in lieu of director fees and GBP30,000 for 2,000,000 shares per his employment contract.

-- During the year GBP18,121 (2019: GBP160,300) was paid to RCA Associates Ltd, a company of which Rolf Gerritsen is a director, in respect of Directors fees, consultancy services & share based payments. The share based payments include GBP12,000 for 1,200,000 shares in lieu of director fees.

-- During the year GBP22,167 (2019: GBP26,167) was paid to Hancock Corporate Investments Pty Ltd, a company in which Greg Hancock is a Director, in respect of Directors fees and consultancy services.

-- During the year GBP13,584 (2019: GBPnil) was paid to Dan Maling, in respect of Wages & Salaries and Directors fees.

-- During the year GBP13,667 (2019: GBPnil) was paid to The Springton Trust, a trust in which David Clarke is a Trustee, in respect of Directors fees and consultancy services.

 
Year ended 31 December   Remuneration      Fees   Bonus   Severance    Total 
 2019                             GBP       GBP     GBP         GBP      GBP 
-----------------------  ------------  --------  ------  ----------  ------- 
C Moulton                      25,000    93,500       -           -  118,500 
R Gerritsen                    43,000   117,300       -           -  160,300 
G Hancock                       6,667     9,500  10,000           -   26,167 
K Watson                            -         -       -      21,660   21,660 
-----------------------  ------------  --------  ------  ----------  ------- 
                               74,667   220,300  10,000      21,660  326,627 
-----------------------  ------------  --------  ------  ----------  ------- 
 

-- During the year GBP118,500 (2018: GBPnil) was paid to Moulton Metals Pty Ltd, a company in which Craig Moulton is a Director, in respect of Directors fees and consultancy services. At the year end, GBP51,756 is included in trade payables. Of this amount he received 2,118,750 shares in lieu of director fees and 2,500,000 shares per his employment contract.

-- During the year GBP130,300 (2018: GBP48,000) was paid to RCA Associates Ltd, a company of which Rolf Gerritsen is a director, in respect of Directors fees and consultancy services. During the year GBP30,000 (2018: GBPnil) was paid to RCA Associates Ltd, for Rolf Gerritsen's assistance with the acquisition of Lady Alice Mines Pty Ltd.

-- During the year GBP26,167 (2018: GBPnil) was paid to Hancock Corporate Investments Pty Ltd, a company in which Greg Hancock is a Director, in respect of Directors fees and consultancy services.

-- Ken Watson received GBP13,663 (AUD 25,000) in cash and GBP7,997 (AUD 15,000) in shares as part of a settlement agreement upon his resignation as Director of the Company.

   5.         INCOME TAXES 

a) Analysis of tax in the period

 
               31 December   31 December 
                      2020          2019 
                       GBP           GBP 
 Current tax             -             - 
 Deferred taxation       -             - 
                         -             - 
                      ====  ============ 
 
 

b) Factors affecting tax charge or credit for the period

The tax assessed on the loss on ordinary activities for the period differs from the standard rate of corporation tax in the UK of 19% (2019: 19%) and Australia of 27.5% (2019: 27.5%). The differences are explained below:

 
                                                    31 December  31 December 
                                                           2020         2019 
                                                            GBP          GBP 
Loss on ordinary activities before tax              (1,006,750)    (668,900) 
                                                    ===========  =========== 
 
Loss multiplied by weighted average applicable 
 rate of tax                                          (234,069)    (155,915) 
Effects of: 
Expenses not deductible for tax                                       28,923 
Losses carried forward not recognised as deferred 
 tax assets                                             234,069      126,992 
                                                              -            - 
                                                    ===========  =========== 
 

The weighted average applicable tax rate of 23.25% (2019: 23.25%) used is a combination of the standard rate of corporation tax rate for entities in the United Kingdom of 19% (2019: 19%), and 27.5% (2019: 27.5%)in Australia.

   6.         EARNINGS PER SHARE 

Basic and diluted loss per share is calculated by dividing the loss attributed to ordinary shareholders of GBP1,006,750 (2019: GBP668,900 loss) by the weighted average number of shares of 282,956,585 (2019: 67,233,532) in issue during the year.

The basic and dilutive loss per share are the same as the effect of the exercise of share warrants and options would be anti-dilutive.

   7.            INVESTMENTS IN SUBSIDIARY UNDERTAKINGS 
 
                      Investments  Loans    Total 
Company                       GBP    GBP      GBP 
At 1 January 2020         432,260      -  432,260 
At 31 December 2020       432,260      -  432,260 
                      -----------  -----  ------- 
 

Investments in Group undertakings are stated at cost less impairment. In 2019 the Company acquired 100% of the issued share capital of Lady Alice Mines Pty Ltd and in turn, 100% of the units in the Lady Alice Trust which is wholly owned by Lady Alice Mines Pty Ltd.

At 31 December 2020 the Company held the following interests in subsidiary undertakings, which are included in the consolidated financial statements and are unlisted.

 
                                                                Proportion 
 Name of company                  Registered office address      held        Business 
                                  Level 2, 1-5 Walker Avenue, 
 Lady Alice Mines Pty Ltd          West Perth, WA, Australia    100%         Mining 
                                  Level 2, 1-5 Walker Avenue, 
 Lady Alice Mines Unit Trust(1)    West Perth, WA, Australia    100%         Mining 
 

(1) Lady Alice Mines Unite Trust is a wholly owned entity of Lady Alice Mines Pty Ltd.

   8.           INTANGIBLE FIXED ASSETS 

Intangible assets comprise exploration and evaluation costs. Exploration and evaluation assets are all internally generated except for those acquired at fair value as part of a business combination.

 
                                 Total 
Group                              GBP 
At 1 January 2019                    - 
Acquired at fair value         606,560 
Additions                        5,660 
At 1 January 2020              612,242 
Additions                      883,277 
At 31 December 2020          1,495,519 
                            ---------- 
 
 
 
                              Total 
Company                         GBP 
At 1 January 2019                 - 
Acquired at fair value            - 
Additions                         - 
At 1 January 2020                 - 
Additions                    33,251 
At 31 December 2020          33,251 
                            ------- 
 

As at 31 December 2020 there was GBP33,251 in drilling services performed and to be settled in shares. The shares were issued post balance date in April 2021. As at 31 December 2020 these drilling services have been recognised as an accrued liability in advance of shares being issued.

The Directors 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 necessary for the year ended 31 December 2020.

 
 9. PROPERTY, PLANT AND EQUIPMENT - Group 
  and Company 
                                             Office Equipment     Total 
   2020 
 Cost                                                     GBP       GBP 
 At 31 December 2019                                    4,407     4,407 
 Additions during the year                                  -         - 
 At 31 December 2020                                    4,407     4,407 
 Depreciation 
 At 31 December 2019                                    (979)     (979) 
 Charge for the year                                  (1,028)   (1,028) 
 At 31 December 2020                                  (2,007)   (2,007) 
 Net book value 
                                            -----------------  -------- 
 At 31 December 2020                                    2,400     2,400 
                                            -----------------  -------- 
 
 
 2019                         Office Equipment   Total 
 Cost                                      GBP     GBP 
 At 31 December 2018                         -       - 
 Additions during the year               4,407   4,407 
 At 31 December 2019                     4,407   4,407 
 Depreciation 
 At 31 December 2018                         -       - 
 Charge for the year                     (979)   (979) 
 At 31 December 2019                     (979)   (979) 
 Net book value 
                             -----------------  ------ 
 At 31 December 2019                     3,428   3,428 
                             -----------------  ------ 
 
   10 .      TRADE AND OTHER RECEIVABLES 
 
                         Group    Group    Company 
                        31 Dec   31 Dec     31 Dec          Company 
                          2020     2019       2020      31 Dec 2019 
 
Current                    GBP      GBP        GBP              GBP 
Prepayments                  -   32,890          -           32,890 
Intercompany debtors         -        -  1,637,335          208,413 
Goods & Services Tax    70,266    4,307          -                - 
Other debtors            (858)      236      (858)              215 
                       -------  -------  ---------  --------------- 
                        69,408   37,433  1,636,477          241,518 
                       =======  =======  =========  =============== 
 

The fair value of trade and other receivables approximates to their book value. Other classes of financial assets included within trade and other receivables do not contain impaired assets.

The carrying amounts of the Group and Company's trade and other receivables are denominated in the following currencies:

 
                           Group    Group                 Company 
                          31 Dec   31 Dec        Company   31 Dec 
                            2020     2019    31 Dec 2020     2019 
                             GBP      GBP            GBP      GBP 
UK pounds                  (858)   33,126      1,636,477  241,518 
Australian dollars        70,266    4,307              -        - 
                     -----------  -------  -------------  ------- 
                          69,408   37,433      1,636,477  241,518 
                     ===========  =======  =============  ======= 
 
   11.      CASH AND CASH EQUIVALENTS 
 
                               Group    Group 
                              31 Dec   31 Dec        Company            Company 
                                2020     2019    31 Dec 2020        31 Dec 2019 
                                 GBP      GBP            GBP                GBP 
Cash at bank and in hand   1,338,851    7,675        834,164              1,749 
                           1,338,851    7,675        834,164              1,749 
                           =========  =======  =============  ================= 
 

The fair value of cash at bank is the same as its carrying value.

The carrying amounts of the Group and Company's cash and cash equivalents are denominated in the following currencies:

 
                         Group    Group                  Company 
                        31 Dec   31 Dec        Company    31 Dec 
                          2020     2019    31 Dec 2020      2019 
                           GBP      GBP            GBP       GBP 
UK pounds              834,164    1,749        834,164     1,749 
Australian dollars     504,687    5,926              -         - 
                     ---------  -------  -------------  -------- 
                     1,338,851    7,675        834,164     1,749 
                     =========  =======  =============  ======== 
 
   12.         TRADE AND OTHER PAYABLES 
 
                                        Group    Group                  Company 
                                       31 Dec   31 Dec        Company    31 Dec 
                                         2020     2019    31 Dec 2020      2019 
Current                                   GBP      GBP            GBP       GBP 
Trade creditors                        94,985  266,509         35,960   263,473 
Share subscriptions paid in advance         -   35,700              -    35,700 
GST collected                           4,437    3,784              -         - 
Accruals and deferred income           59,676  130,559         59,676   123,387 
Other payables                         10,215        -              -         - 
                                      -------  -------  -------------  -------- 
                                      169,314  436,553         95,636   422,560 
                                      =======  =======  =============  ======== 
 

The fair value of trade and other payables approximates to their book value.

The carrying amounts of the Group and Company's trade and other payables are denominated in the following currencies:

 
                          Group    Group                  Company 
                         31 Dec   31 Dec        Company    31 Dec 
                           2020     2019    31 Dec 2020      2019 
                            GBP      GBP            GBP       GBP 
UK pounds                95,636  422,560         95,636   422,560 
Australian dollars       73,677   13,993              -         - 
                     ----------  -------  -------------  -------- 
                        169,314  436,553         95,636   422,560 
                     ==========  =======  =============  ======== 
 
   13.      DEFERRED CONSIDERATION 
 
2019                            Total 
Group and Company                 GBP 
Amounts payable 
 under business 
 combination                  565,552 
At 31 December 
 2019                         565,552 
                              ------- 
 
Categorised as: 
Current liabilities           215,486 
                              ------- 
Non-current liabilities       350,066 
                              ------- 
 

Refer to note 17 for further detail.

 
2020                           Total 
Group and Company                GBP 
Amounts payable under 
 business combination        511,412 
At 31 December 2020          511,412 
                             ------- 
 
Categorised as: 
Current liabilities          188,721 
                             ------- 
Non-current liabilities      322,691 
                             ------- 
 

During the year 2020, there has been a movement in the Deferred Consideration of GBP54,140. The movement is a reflection of the Consideration shares paid to the previous Lady Alice Mines unit holders as agreed upon at time of acquisition, and a revised to the value of contingent consideration based on a revision to the underlying assumptions used in determining estimated value. The Deferred consideration as at 31 December 2020 of GBP511,412, reflects the amount still outstanding.

 
 Movements for the year                     Total 
                                              GBP 
 At 31 December 2019                      565,552 
 Consideration paid during the year     (215,486) 
 Change in estimate of contingent 
  consideration                           161,346 
 
 At 31 December 2020                      511,412 
                                       ---------- 
 

Refer to note 17 for further detail.

   14.      SHARE CAPITAL 
 
                                      Dec 2020   Dec 2020    Dec 2019  Dec 2019 
                                        Number                 Number 
                                     of shares        GBP   of shares       GBP 
Issued, called up and fully paid 
Ordinary shares of GBP0.01         282,956,585  2,829,565  67,233,532   672,335 
                                   -----------  ---------  ----------  -------- 
Total                              282,956,585  2,829,565  67,233,532   672,335 
                                   ===========  =========  ==========  ======== 
 

As at 31 December 2020 the Company had 127,796,891 warrants outstanding (2019: 63,351,916).

Each ordinary share is entitled to one vote in any circumstances. Each ordinary share is entitled pari passu to dividend payments or any other distribution and to participate in a distribution arising from a winding up of the Company.

   15.                  SHARE BASED PAYMENTS 

2020

Warrants

 
                                                                   Weighted 
                                                                    average 
                                                       Warrants    exercise 
                                                         Number       price 
 
 
 Warrants at 31 December 
  2019                                               63,351,916       0.02p 
 Granted during year                                109,374,168       0.03p 
 Exercised during year                             (29,812,693)       0.02p 
 Lapsed during year                                (15,116,500)       0.02p 
 
   Warrants at 31 December 
   2020                                             127,796,891       0.02p 
                               ================================  ========== 
 
 Exercisable at year 
  end                                     127,796,891                 0.02p 
                               ================================  ========== 
 

At 31 December 2020 the weighted average remaining contractual life of the warrants outstanding was 1.39 years.

2019

Warrants

 
                                                                  Weighted 
                                                                   average 
                                                      Warrants    exercise 
                                                        Number       price 
 At incorporation                                            -           - 
 Issued during the year                             63,351,916       0.02p 
 Warrants at 31 December 
  2018                                              63,351,916       0.02p 
                               ===============================  ========== 
 
 
 
 
   Warrants at 31 December 
   2019                                             63,351,916       0.02p 
                               ===============================  ========== 
 
 Exercisable at year 
  end                                     63,351,916                 0.02p 
                               ===============================  ========== 
 

At 31 December 2019 the weighted average remaining contractual life of the warrants outstanding was 1 year.

2020

Options

 
                                                 Weighted 
                                                  average 
                                                 exercise 
                               Options Number       price 
 
 
 Options at 31 December 
  2019                              1,344,672      0.015p 
                              ===============  ========== 
 
 Issued during the period          15,000,000      0.033p 
 
 Exercised during the 
  year                              (672,336)      0.015p 
 
 Options at 31 December 
  2020                             15,672,336      0.033p 
                              ===============  ========== 
 
 Exercisable at year 
  end                                 672,336      0.015p 
                              ===============  ========== 
 

At 31 December 2020 the weighted average remaining contractual life of the options outstanding was 4.43 years.

2019

Options

 
                                                 Weighted 
                                                  average 
                                                 exercise 
                               Options Number       price 
 At incorporation                           -           - 
 Issued during the year                     -           - 
 Options at 31 December 
  2018                                      -           - 
                              ===============  ========== 
 
 Issued during the period           1,344,672      0.015p 
 
 
 Options at 31 December 
  2019                              1,344,672      0.015p 
                              ===============  ========== 
 
 Exercisable at year 
  end                                 672,336      0.015p 
                              ===============  ========== 
 

At 31 December 2019 the weighted average remaining contractual life of the options outstanding was 3 years.

The fair value of equity settled share options and warrants granted is estimated at the date of grant using a Black-Scholes option pricing model, taking into account the terms and conditions upon which the options were granted. The following table lists the inputs to the model:

 
                                 Options         Warrants        Warrants 
---------------------  ---  ----------------  --------------  -------------- 
 Date of grant                  14 July 2020      16 January      29 October 
                                                        2020            2020 
  Expected volatility                 94.59%          23.39%         108.75% 
  Expected life                            5               2               2 
  Risk-free interest                   0.10%           0.75%           0.10% 
   rate 
  Expected dividend                    0.00%           0.00%           0.00% 
   yield 
  Fair value per 
   option/warrant 
                                    GBP0.008       GBP0.0003        GBP0.014 
---------------------  ---  ----------------  --------------  -------------- 
 
   16.          FINANCIAL INSTRUMENTS 
 
                                                           Group         Group       Company       Company 
                                                     31 Dec 2020   31 Dec 2019   31 Dec 2020   31 Dec 2019 
                                                             GBP           GBP           GBP           GBP 
Financial assets at amortised cost 
Trade and other receivables excluding prepayments         69,408         4,543     1,636,477       208,628 
Cash and cash equivalents                              1,338,851         7,675       834,164         1,749 
                                                       1,408,259        12,218     2,470,641       210,377 
                                                    ============  ============  ============  ============ 
Financial liabilities 
Trade and other payables (at amortised cost)           (109,638)     (305,993)      (35,960)     (299,173) 
Deferred consideration (at FVPL)                       (511,412)     (565,552)     (511,412)     (565,552) 
                                                       (621,050)     (871,545)     (547,372)     (864,725) 
                                                    ============  ============  ============  ============ 
 
   17.      BUSINESS COMBINATION 

Lady Alice Mines Pty Ltd

On 7 March 2019, the Company acquired 100% of the share capital of Lady Alice Mines Pty Ltd ('LAM') and its wholly owned subsidiary The Lady Alice Trust (the 'Trust'), for total consideration of GBP432,262 which is to be satisfied via a mix of cash and share consideration which is shown below. In addition, the Company agreed to settle existing liabilities due to unitholders of the Trust of up to A$250,000. The share based payment consideration was settled on 16 January 2020 upon the successful re-admission to the London's Stock Exchange Main Market. 10,815,297 shares were issued at a close price of 1.25p.

The Trust has an entitlement to earn a 75% equity interest in tenements near Wudinna in South Australia for gold exploration (the 'Wudinna Agreement'), and is also the sole owner of the right, title and interest in the Prince Alfred Licence, a formerly producing copper mine.

The principal terms of the Wudinna Agreement are as follows:

   --    Stage 1: the Trust will fund A$2.1 million within three years to earn a 50% equity position 

-- Stage 2: at the completion of Stage 1, a joint venture vehicle can be formed, or alternatively the Trust can spend a further A$1.65 million over an additional two years to earn a 65% equity interest

-- Stage 3: at the completion of Stage 2, a joint venture vehicle can be formed, or alternatively the Trust can spend a further A$1.25 million within one year to earn a 75% equity interest

The contingent consideration is due to the unitholders on satisfying the following project milestones:

   --    First Option - 14% of the total issued share capital on completion of Stage 1 
   --    Second Option - 21% of the total issued share capital on completion of Stage 2 

-- Third Option - 30,000,000 ordinary shares on announcement of a JORC-compliant Indicated Mineral Resource for the Wudinna Project of not less than 750,000 ounces of gold

The Directors have calculated the consideration payable on a probability basis of satisfying the project milestones in accordance with IFRS 3 Business Combinations. The Directors have also estimated the number of shares to be issued at each milestone and the share price. This has been fixed at the number of consideration shares issued at the time of the RTO and the share price at that time. Management believe this is a best estimate.

The following table summarises the consideration paid for LAM and the values of the assets and equity assumed at the acquisition date.

 
Total consideration               GBP 
----------------------------  ------- 
Cash                              553 
Share based payments at RTO   135,191 
Contingent consideration      296,536 
                              432,262 
                              ------- 
 
 
Recognised amounts of assets and liabilities acquired         GBP 
------------------------------------------------------  --------- 
Cash and cash equivalents                                  12,169 
Exploration assets (note 8)                               606,560 
Trade and other payables                                (186,467) 
 
Total identifiable net assets                             432,262 
                                                        --------- 
 
   18.      RELATED PARTY TRANSACTIONS 

Save as disclosed below there were no related party transactions during the year other than remuneration to Directors disclosed in note 4.

During the year, the Group paid GBP6,928 in respect of rent to AusQuest, a company in which Gregory Hancock is a Director.

During the year, the Group paid GBP21,300 in respect of project management services to Orana Corporate LLP, a company in which Daniel Maling is a Partner.

As at 31 December 2020, included in the other receivables is GBP1,637,335 due from Lady Alice Mines Pty Ltd, a subsidiary company. The loan is interest free and repayable on demand.

   19.      POST YEAR END EVENTS 

On 11 January 2021, the Company issued a total of 32,383,152 new ordinary shares pursuant to completion of Stage 1 earn-in of the Wudinna Gold Project, with 31,049,819 shares at 2.4 pence per share being issued in accordance with the acquisition agreement to the vendors of Lady Alice Trust and Lady Alice Mines Pty Ltd, and 1,333,333 shares at 1.5 pence per share issued to the Company's CEO in accordance with the terms of his service agreement.

On 28 January 2021, the Company issued 1,934,800 new ordinary shares pursuant to the exercise of warrants, with 934,800 shares at a price of 3 pence per share and 1,000,000 shares at a price of 2 pence per share.

On 18 and 19 of February 2021, the Company issued 2,333,334 new ordinary shares and 1,666,667 new ordinary shares respectively, at 2 pence per share, pursuant to the exercise of warrants.

On 29 April 2021, the Company issued a total of 7,110,053 new ordinary shares, with 5,664,340 shares being issued at 1 pence per share to the vendors of Lady Alice Trust and Lady Alice Mines Pty Ltd in accordance with the acquisition agreement for the Wudinna Gold Project, and 1,445,713 shares at 2.3 pence per share to a drilling contractor in settlement of a contractual agreement in respect of the provision of service.

   20.          ULTIMATE CONTROLLING PARTY 

There is no ultimate controlling party.

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END

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(END) Dow Jones Newswires

June 30, 2021 02:00 ET (06:00 GMT)

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