30 September 2024
Bezant Resources Plc
("Bezant" or the "Company")
Interim Results for the Six Months Ended 30 June 2024
Bezant (AIM: BZT), the copper-gold exploration and development company, announces its unaudited interim results for the six months ended 30 June 2024.
Chairman's Statement
Dear Shareholders,
The focus of the first half of 2024 continues to be Southern Africa in particular preparatory technical and commercial work in anticipation of the granting of a mining licence in Namibia for our Hope and Gorob Project.
General economic and political environment: During the period of the interim results the world has not materially changed but geopolitical tension has probably worsened due to the ongoing impact of the Ukraine war and related sanctions and escalation of conflicts in the Levant area of the Middle East. This is a macro-economic situation which does not have a direct impact on the Company as it does not have assets in or have business activities or suppliers in either Ukraine. Russia or the Levant areas of the Middle East.
The financial world is seeing some inflation control and against this optimism, we are seeing interest rates being lowered in the USA appearing to be the most aggressive. The latest significant 50bp decrease may be too soon and the next few months will test question. The stock markets have responded favourably and are not anticipating a re-ignition of inflation. Should they be wrong, then we might well see a perfect climate for commodities.
Financial highlights:
£487K loss after tax (unaudited 30 June 2023: £463K)
Approximately £156K cash at bank at the period end (audited 31 December 2023: £560K).
Operational and corporate events in six months to 30 June 2024
In Namibia: The Hope and Gorob project in Namibia (in which Bezant holds a 70% interest) is extremely well placed, since it is ready for production and has the ability once fully explored, to achieve Tier 1 status. We are currently awaiting a mining licence and have reached the point where all key considerations have been addressed technically and financing offers are under consideration in an advance form.
During the period, most technical factors have been considered and we are convinced that at least the first five years ore supply can be provided from a number of mini pits, which on the medium term can access high grade underground material, providing a long-life operation. During the early years, we will conduct an aggressive drilling programme, which has the potential to upscale the operation to a larger operation after the provision of a processing plant.
In Botswana: the Kanye battery manganese project is showing the potential to be larger than originally anticipated and our previous work has demonstrated that we can produce a battery suitable product from the deposit. We are aware that Giyani Metals Corp announced in September 2024 the issue of a mining licence for their K. Hill manganese project which is close to the Kanye project area and we take this as a positive sign of the willingness of the Botswana government to support manganese mining.
In Zambia: Our collaboration agreement with PCB Mining Ltd, which has gold interest in the Northwest Zambia is progressing favourably and our geological team and technical staff are assisting shareholders in their efforts to restart the operation and conduct production-focused exploration.
Investment in Mankayan Project in Philippines: IDM International Ltd the Australian holding company and Crescent Mining Development Corporation the licence holder continue to make good progress with the Mankayan project in the Philippines and we are hopeful that our 22.96% interest in IDM International will be monetised in one form or another. The Mankayan project is well drilled and well studied and has the potential to be a meaningful contributor to the world's future copper demands.
Eureka Project Argentina: Our Eureka licences in Argentina have attracted interest from a number of parties and we continue to hold site visits and discussions with interested parties.
Funding: In March long term shareholder Sanderson Capital Partners Limited agreed to an extension of our Facility with them to 31 July 2025 and we are grateful for their continuing support.
Issue of Equity: No shares were issued during the period.
Operational and corporate post period end events
Post the period end we have on the following dates announced;
· 24 July 2024: the signing of a letter of intention for a partnership for the delivery of a sustainable renewable solar energy supply for the Hope & Gorob project;
· 27 August 2024: that geophysical surveying has extended the potential target at the Kanye manganese project;
· 28 August 2024: the issue of an Environmental Clearance Certificate for exploration licence EPL 717O valid through to 12 August 2027; and
· 26 September 2024: the renewal of exploration licence EPL 6605 for two years to 28 August 2026.
Outlook: Copper is showing resilience in the USD9,000 range per tonne, with resistance against fundamentals which are inescapable when making a case for copper. The demand side is continuing despite a slow down in the Chinese economy and the EV story slowing down because of structural problems. The demand side is unstoppable, based on third world development bringing disposal income and the emergence of India, which could be as rapid as China was commencing some 20 years ago.
The supply side is dismal from whichever angle it is viewed and there is no quick fix to this situation. What is surprising is the lack of recognition by the Mining Industry of a seriously worsening problem. Mergers and acquisitions do not create new copper. We believe the small and medium sized new copper projects currently being planned or developed may assist with a short-term solution but by no means solve it.
In terms of our own projects we continue to have several ongoing discussions regarding finance and resource collaboration for their advancement and will update shareholders as we have news to report.
I would like to thank my fellow directors and management in their untiring efforts to enhance shareholder value in what must be the most difficult period in the small natural resource sector.
Colin Bird
Executive Chairman
30 September 2024
For further information, please contact:
Bezant Resources Plc Colin Bird Executive Chairman |
|
|
Beaumont Cornish (Nominated Adviser) |
|
|
Novum Securities Limited (Joint Broker) Jon Belliss |
+44 (0) 20 7399 9400 |
|
Shard Capital Partners LLP (Joint Broker) Damon Heath |
+44 (0) 20 7186 9952 |
or visit http://www.bezantresources.com
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law pursuant to the Market Abuse (Amendment) (EU Exit) regulations (SI 2019/310).
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated Adviser and is authorised and regulated by the FCA. Beaumont Cornish's responsibilities as the Company's Nominated Adviser, including a responsibility to advise and guide the Company on its responsibilities under the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed solely to the London Stock Exchange. Beaumont Cornish is not acting for and will not be responsible to any other persons for providing protections afforded to customers of Beaumont Cornish nor for advising them in relation to the proposed arrangements described in this announcement or any matter referred to in it.
Group Statement of Profit and Loss
For the six months ended 30 June 2024
|
Notes |
Unaudited Six months ended 30 June 2024 £'000 |
Unaudited Six months ended 30 June 2024 £'000 |
|
|
|
|
CONTINUING OPERATIONS |
|
|
|
|
|
|
|
Group revenue |
|
- |
- |
Cost of sales |
|
- |
- |
|
|
|
|
Gross profit |
|
- |
- |
|
|
|
|
Operating expenses |
|
(294) |
(386) |
Share based payments |
4 |
(53) |
- |
Group operating loss |
|
(347) |
(386) |
|
|
|
|
Fair value adjustment |
|
(28) |
- |
Finance Costs |
|
(64) |
(77) |
Impairment of assets |
|
(48) |
- |
|
|
|
|
Loss before taxation |
|
(487) |
(463) |
Taxation |
|
- |
- |
|
|
|
|
Loss for the period |
|
(487) |
(463) |
Loss per share (pence) |
|
|
|
Basic and diluted from continuing operations |
5 |
(0.004) |
(0.01) |
Group Statement of Other Comprehensive Income
For the six months ended 30 June 2024
|
|
Unaudited Six months ended 30 June 2024 £'000 |
Unaudited Six months ended 30 June 2023 £'000 |
Other comprehensive income: |
|
|
|
Loss for the period |
|
(487) |
(463) |
Items that may be reclassified to profit or loss: |
|
|
|
Foreign currency reserve movement |
|
(22) |
(179) |
Total comprehensive loss for the period |
|
(509) |
(642) |
Group Statement of Changes in Equity
|
Share Capital £'000 |
Share Premium £'000 |
Other Reserves1 £'000 |
Retained Losses £'000 |
Non-Controlling interest |
Total Equity £'000 |
Unaudited - six months ended 30 June 2024 |
|
|
|
|
|
|
Balance at 1 January 2024 |
2,205 |
41,431 |
4,127 |
(41,788) |
- |
5,975 |
Current period loss |
- |
- |
- |
(487) |
- |
(487) |
Foreign currency reserve |
- |
- |
(22) |
- |
- |
(22) |
|
|
|
|
|
|
|
Total comprehensive loss for the period |
- |
- |
(22) |
(487) |
- |
(509) |
Proceeds from shares issued |
- |
- |
- |
- |
- |
- |
Share issue costs |
- |
(51) |
- |
- |
- |
(51) |
Share based payments -options |
- |
- |
53 |
- |
- |
53 |
Equity component of borrowings |
- |
- |
|
- |
- |
- |
Balance at 30 June 2024 |
2,205 |
41,380 |
4,158 |
(42,275) |
- |
5,468 |
|
Share Capital £'000 |
Share Premium £'000 |
Other Reserves1 £'000 |
Retained Losses £'000 |
Non-Controlling interest |
Total Equity £'000 |
Unaudited - six months ended 30 June 2023 |
|
|
|
|
|
|
Balance at 1 January 2023 |
2,079 |
39,507 |
3,672 |
(35,551) |
- |
9,707 |
Current period loss |
- |
- |
- |
(463) |
- |
(463) |
Foreign currency reserve |
- |
- |
(179) |
- |
- |
(179) |
|
|
|
|
|
|
|
Total comprehensive loss for the period |
- |
- |
(179) |
(463) |
- |
(642) |
Proceeds from shares issued |
37 |
713 |
- |
- |
- |
750 |
Shares issued - in lieu of fees |
- |
(81) |
21 |
- |
- |
(60) |
Warrants exercised |
14 |
422 |
- |
- |
- |
436 |
Share options granted |
- |
- |
272 |
- |
- |
272 |
Balance at 30 June 2023 |
2,130 |
40,561 |
3,786 |
(36,014) |
- |
10,463 |
1 Other reserves is made up of the share-based payment and foreign exchange reserve.
As at 30 June 2024
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
Notes |
£'000 |
£'000 |
|
|
|
|
ASSETS
|
|
|
|
Non-current assets |
|
|
|
Plant and equipment |
6 |
- |
- |
Investments |
7 |
2,122 |
2,150 |
Exploration and evaluation assets |
8 |
4,114 |
3,899 |
Total non-current assets |
|
6,236 |
6,049 |
|
|
|
|
Current assets |
|
|
|
Trade and other receivables |
|
42 |
224 |
Cash and cash equivalents |
|
156 |
560 |
Total current assets |
|
198 |
784 |
|
|
|
|
TOTAL ASSETS |
|
6,434 |
6,833 |
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
Current liabilities |
|
|
|
Trade and other payables |
|
376 |
332 |
Borrowings |
9 |
590 |
526 |
Total current liabilities |
|
966 |
858 |
|
|
|
|
NET ASSETS |
|
5,468 |
5,975 |
|
|
|
|
EQUITY |
|
|
|
Share capital |
10 |
2,205 |
2,205 |
Share premium |
10 |
41,380 |
41,431 |
Share-based payment reserve |
|
1,529 |
1,476 |
Foreign exchange reserve |
|
596 |
618 |
Merger reserve |
|
1,831 |
1,831 |
Other reserves |
|
202 |
202 |
Retained losses |
|
(42,275) |
(41,788) |
TOTAL EQUITY |
|
5,468 |
5,975 |
Group Statement of Cash Flows
For the six months ended 30 June 2024
|
|
Unaudited |
Unaudited |
|
|
Six months ended 30 June 2024 |
Six months ended 30 June 2023 |
|
Notes |
£'000 |
£'000 |
|
|
|
|
Net cash outflow from operating activities |
11 |
(90) |
(246) |
|
|
|
|
Cash flows from/(used) in investing activities |
|
|
|
Deferred exploration expenditure |
|
(263) |
(149) |
|
|
(263) |
(149) |
Cash flows from financing activities |
|
|
|
Costs re issuance of ordinary shares |
|
(51) |
703 |
Borrowings |
|
- |
- |
|
|
(51) |
703 |
Increase/(decrease) in cash |
|
(404) |
308 |
|
|
|
|
Cash and cash equivalents at beginning of period |
|
560 |
57 |
Foreign exchange movement |
|
- |
- |
|
|
|
|
Cash and cash equivalents at end of period |
|
156 |
365 |
Notes to the interim financial information
For the six months ended 30 June 2024
1. |
Basis of preparation The unaudited interim financial information set out above, which incorporates the financial information of the Company and its subsidiary undertakings (the "Group"), has been prepared using the historical cost convention and in accordance with International Financial Reporting Standards ("IFRS"), including IFRS 6 'Exploration for and Evaluation of Mineral Resources', as adopted by the European Union ("EU") and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.
These interim results for the six months ended 30 June 2024 are unaudited and do not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The financial statements for the year ended 31 December 2023 have been delivered to the Registrar of Companies and the auditors' report on those financial statements was unqualified and contained a material uncertainty pertaining to going concern.
Going concern basis of accounting The Group made a loss from all operations for the six months ended 30 June 2024 after tax of £0.49 million (2023: £0.46 million), and had negative cash flows from operations and is currently not generating revenues. Cash and cash equivalents were £156K as at 30 June 2024 (December 2023 £560K).
On 5 March 2024 the Company announced that the repayment date for the £700,000 drawdowns under the Sanderson Capital Facility Agreement had been extended to 31 July 2025. An operating loss is expected in the year subsequent to the date of these accounts and the Company will need to raise funding to provide additional working capital to finance its ongoing activities. Management has successfully raised money in the past, but there is no guarantee that adequate funds will be available when needed in the future.
Based on the Board's assessment that the Company will be able to raise additional funds, as and when required, to meet its working capital and capital expenditure requirements, the Board have concluded that they have a reasonable expectation that the Group can continue in operational existence for the foreseeable future. For these reasons the Group continues to adopt the going concern basis in preparing the annual report and financial statements.
There is a material uncertainty related to the conditions above that may cast significant doubt on the Group's ability to continue as a going concern and therefore the Group may be unable to realize its assets and discharge its liabilities in the normal course of business.
The financial report does not include any adjustments relating to the recoverability and classification of recorded asset amounts or liabilities that might be necessary should the entity not continue as a going concern.
|
2 |
Significant accounting judgments, estimates and assumptions |
|
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting year are: |
|
Share-based payment transactions: |
|
The Group measures the cost of equity-settled transactions with directors, consultants and employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using a Black and Scholes model which takes into account expected share volatility, strike price, term of the option and the dividend policy. |
|
Impairment of investments, options and deferred exploration expenditure: |
|
|
The Group determines whether investments (including those acquired during the period), options and deferred exploration expenditure are impaired when indicators, based on facts and circumstances, suggest that the carrying amount may exceed its recoverable amount. Such indicators include the point at which a determination is made as to whether or not commercial mining reserves exist in the subsidiary or associate in which the investment is held or whether exploration expenditure capitalised is recoverable by way of future exploitation or sale, obviously pending completion of the exploration activities associated with any specific project in each segment.
|
|
|
Fair value of assets and liabilities acquired on acquisition of subsidiaries |
|
|
The Group determines the fair value of assets and liabilities acquired on acquisition of subsidiaries by reference to the carrying value at the date of acquisition and by reference to exploration activities undertaken and/or information that the Directors become aware of post acquisition (note 8).
|
|
|
Investments at fair value through profit and loss ('Equity investments') |
|
|
Equity investments are initially measured at cost, including transaction costs. At each reporting date, the fair value is assessed and any resultant gains and losses are included directly in the Consolidated Statement of Profit and Loss under IFRS 9.
Valuation of Equity Instruments Convertible Loan (Borrowings) Convertible instruments can be complex, containing a number of features which can have a significant impact on the accounting under IFRS 9 Financial Instruments and IAS 32 Presentation of Financial Instruments. The Company determined that the £700,000 convertible note drawn down announced on 30 June 2022 ("Original Facility") (note 9) was an equity instrument as the conversion feature results in the conversion of a fixed amount of stated principal into a fixed number of shares, it satisfies the 'fixed for fixed' criterion and, therefore, it is classified as an equity instrument which requires the valuation of the liability component and the equity conversion component. The fair value of the liability component, included in current borrowings, at inception was calculated using a market interest rate for an equivalent instrument without conversion option. The discount rate applied was 25%.
The Company determined that; i) the change in terms of the Original Facility announced on 15 June 2023 being that the repayment date was extended to 23 December 2024 and the conversion price was reduced to 0.08 pence per share (the "Modified Facility") were in accordance with IFRS 9 substantially different; and ii) the Modified Facility was an equity instrument as the conversion feature results in the conversion of a fixed amount of stated principal into a fixed number of shares, it satisfies the 'fixed for fixed' criterion and, therefore, it is classified as an equity instrument which requires the valuation of the liability component and the equity conversion component. The fair value of the liability component, included in current borrowings, at inception was calculated using a market interest rate for an equivalent instrument without conversion option. The discount rate applied was 25%.
On 5 March 2024 the Company announced that by an agreement dated 4 March 2024 it had agreed with the Lender to extend the repayment date for the £700,000 drawn down under the Facility to 31 July 2025 and that the £700,000 drawn down is now convertible by the Lender at the fixed price of 0.06 pence per share (the "New Conversion Price") (the "Extended Facility") .
The Company determined that the Extended Facility was in accordance with IFRS 9 not substantially different from the terms of the Modified Facility and that therefore the Modified Facility has not been deemed repaid when the Extended Facility terms were agreed.
|
|
|
|
|
3. |
Segment reporting For the purposes of segmental information, the operations of the Group are focused in geographical segments, namely the UK, Argentina, Namibia, and Botswana, and comprise one class of business: the exploration, evaluation and development of mineral resources. The UK is used for the administration of the Group and includes equity investments in non-group companies.
The Group's loss before tax arose from its operations in the UK, Argentina Namibia and Botswana. |
|
|
For the six months ended 30 June 2024 - unaudited |
|
|
|
|
|
|
|
UK |
Argentina |
Namibia |
Botswana |
Total |
|
|
£'000 |
£'000 |
|
|
£'000 |
|
|
|
|
|
|
|
|
Consolidated loss before tax |
(451) |
(36) |
- |
- |
(487) |
|
Included in the consolidated loss before tax are the following income/(expense) items: |
|
|
|
|
|
|
Foreign currency gain |
- |
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Total Assets |
3,159 |
11 |
2,962 |
1,141 |
4,114 |
|
Total Liabilities |
(854) |
(112) |
- |
- |
(966) |
|
For the six months ended 30 June 2023 - unaudited |
|
|
|
|
|
|
|
UK |
Argentina |
Namibia |
Botswana |
Total |
|
|
£'000 |
£'000 |
|
|
£'000 |
|
|
|
|
|
|
|
|
Consolidated loss before tax |
(418) |
(45) |
- |
- |
(463) |
|
Included in the consolidated loss before tax are the following income/(expense) items: |
|
|
|
|
|
|
Foreign currency gain |
- |
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Total Assets |
2,663 |
4,867 |
2,536 |
1,052 |
11,118 |
|
Total Liabilities |
(601) |
(54) |
- |
- |
(655) |
4. |
Share based payments |
|
|
|
|
6 months ended 30 June 2024 |
6 months ended 30 June 2023 |
|
|
£'000 |
£'000 |
|
|
|
|
|
Share option expense - Directors |
20 |
- |
|
Share option expense - Management |
33 |
- |
|
|
53 |
- |
5. |
Loss per share |
|
The basic and diluted loss per share for the six months ended 30 June 2024 was 0.004 pence per shares (2023 0.01 pence) and has been calculated using the loss attributable to equity holders of the Company for the six months ended 30 June 2024 of £487,000 (2023: £463,000). The basic and diluted loss per share was calculated using a weighted average number of shares in issue of 11,380,918,869 (2023: 6,139,789,530).
The use of the weighted average number of shares in issue in the period recognises the variations in the number of shares throughout the period and is in accordance with IAS 33 as is the fact that the diluted earnings per share should not show a more favourable position than the basic earnings per share. |
6. |
Plant and equipment |
|
|
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
|
£'000 |
£'000 |
6.1 |
Cost |
|
|
|
Balance at beginning of period |
- |
67 |
|
Disposal - write off of assets |
- |
(67) |
|
At end of period |
- |
- |
|
|
|
|
6.2 |
Depreciation |
|
|
|
Balance at beginning of period |
- |
65 |
|
Charge for the period |
- |
1 |
|
Disposal - write off of assets |
|
(66) |
|
At end of period |
- |
- |
|
|
|
|
|
Net book value at end of period |
- |
2 |
7. |
Investments |
||
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
|
£'000 |
£'000 |
|
|
|
|
|
Investments under fair value through profit and loss (note 7.1) |
2,044 |
2,072 |
|
Debt instruments under fair value through profit and loss (note 7.2) |
78 |
78 |
|
|
2,122 |
2,150 |
7.1 |
Investments
|
|
On 13 September 2021 the Company, entered into a conditional agreement with IDM Mankayan Pty Ltd ("IDM Mankayan"), a company incorporated in Australia, to take the Mankayan Project in the Philippines forward (the "IDM Mankayan Agreement"). The IDM Mankayan Agreement completed on 20 October 2021 and the Company paid A$90,000 (GBP49K) to IDM Mankayan to acquire 44 IDM Mankayan shares (the "IDM Mankayan Investment") of the 160 shares issued by IDM Mankayan but has no management control over or right to appoint directors of IDM Mankayan which is why the IDM Mankayan Investment is held as an equity investment under IFRS 9.
On 26 October 2022 the Company entered into a conditional share purchase agreement with IDM International Ltd ("IDM International") the parent company of IDM Mankayan to sell the IDM Mankayan Investment for 19,381,054 fully paid ordinary shares of IDM International (the "IDM International SPA"). The IDM International SPA was conditional on approval of the IDM International SPA by the shareholders of IDM International and completed on 27 March 2023.
The Mankayan project's MPSA was originally issued for a standard 25 year period, which expired on 11 November 2021, and as announced by the Company on 18 March 2022 has been renewed for a second 25 year term with effect from 12 November 2021.
|
|
On 26 October 2022 the Company entered into a convertible loan note agreement with IDM International to invest A$137,500 (GBP 78K) in IDM International to acquire 137,500 notes (the "IDM International Convertible Loan Note Investment"). The Company has the right to convert the whole but not part of the face value of each Note into IDM International Shares at A$0.20 at any time (and as many times) prior to the Maturity Date which is 11 November 2026. As at 30 June 2024, the fair value of the debt instrument was £78k and no unrealised gain/loss was recognised.
1 19,381,054 shares valued at AUD$0.20 (£0.105) being the share subscription price at which at which third parties subscribed for shares in IDM International in 2023 and 2024.
Investments are initially valued at cost. At each reporting date these investments are measured at fair value with any gains or losses recognised through the Consolidated Statement of Profit and Loss. In the six months to 30 June 2024, the Group and Company had an unrealised loss of £28,000 (YE 31 December 2023 loss of £110,000).
This along with other valuations are estimates based on the Directors' assessment of the performance of the underlying investment and reliable information such as recent fundraising. There is however inherent uncertainty when valuing private companies such as these in the natural resources sector. |
8. |
Exploration and evaluation assets |
|
|
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
|
£'000 |
£'000 |
|
|
|
|
|
Balance at beginning of period |
3,899 |
8,398 |
|
Acquisitions during period |
|
|
|
Exploration expenditure |
263 |
363 |
|
Effect of foreign currency fluctuation impairment |
(48) |
(88) |
|
Impairment (note 8.1) |
- |
(4774) |
|
Carried forward at end of period |
4,114 |
3,899 |
|
|
||||||||||||||||
|
|
9. |
Borrowings
|
|||
|
|
|||
|
|
|
||
|
|
Unaudited |
Audited |
|
|
|
30 June 2024 |
31 December 2023 |
|
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
Balance at beginning of period |
526 |
623 |
|
|
Convertible loan receipts |
- |
- |
|
|
Equity allocation |
- |
(202) |
|
|
Transaction costs |
|
(70) |
|
|
Finance charge accrued |
64 |
175 |
|
|
|
590 |
526 |
|
As announced on 30 June 2022 the Company further to its announcement of 23 November 2021 confirmed that it had issued two drawdown notices of £350,000 each ("Tranche 1" and "Tranche 2") for a total amount of £700,000 (the "Original 2022 Convertible Loan") under its £1,000,000 interest free unsecured convertible loan funding facility with Sanderson Capital Partners Ltd (the "Lender"), a long-term shareholder in the Company (the "Facility"). The amount drawdown was interest free and repayable in 12 months or can be converted at any time at the Lender's option into Bezant shares at fixed prices for Tranche 1 of £350,000, at 0.19 pence per share and for Tranche 2 of £350,000 at 0.225 pence per share. As the conversion feature results in the conversion of a fixed amount of stated principal into a fixed number of shares, it satisfies the 'fixed for fixed' criterion and, therefore, it is classified as an equity instrument. The value of the liability component of £546,000 and the equity conversion component of £154,000 were determined at the date of the drawdowns. The fair value of the liability component, included in current borrowings, at inception was calculated using a market interest rate for an equivalent instrument without conversion option. The discount rate applied was 25%.
Under the terms of the Facility the Lender is due;
a) a drawdown fee of £14,000 being 2% of the amount drawdown which was settled by the issue of 12,522,361 new ordinary shares of £0.00002 each ("Shares") credited as fully paid at 0.1118 pence per share being the five-day VWAP on 28 June 2022 (the "Drawdown Fee Shares"); and
b) £350,000 of three year warrants over Shares (the "Warrants"). The exercise price for the Warrants are as follows:
· £175,000 at 0.25 pence per share for the drawdown of Tranche 1; and
· £175,000 at 0.30 pence per share for the drawdown of Tranche 2.
On 15 June 2023, the Company announced, it had by an agreement dated 14 June 2023 agreed with the Lender to extend the repayment date for the Drawdowns to 23 December 2024 (the "New Repayment Date") and adjusted the conversion prices of Tranche 1 and Tranche 2 to 0.08 pence per share (the "New Conversion Price"). The Company as a loan extension fee i) paid the Lender a £70,000 facility extension and documentation fee equivalent to 6.67% per year which was settled by the issue of 87,500,000 new ordinary shares of 0.002p each ("Shares") at the New Conversion Price ("Facility Extension Fee Shares"); and ii) issue the Lender 437,500,000 warrants over Shares exercisable at 0.12 pence per Share (the "Warrant Exercise Price") exercisable for two years from the date of the Agreement. (the "Facility Extension Fees"). The Company has an option to convert all or part of the £700,000 drawdown if the Company's share price exceeds 0.14 pence for 10 or more business days (the "Modified Terms").
The Company determined that the Modified Facility was in accordance with IFRS 9 substantially different from the terms of the Facility and that therefore the equity instrument comprising the Original Facility was deemed to be repaid on 15 June 2023.
The Modified Facility is an equity instrument as the conversion feature results in the conversion of a fixed amount of stated principal into a fixed number of shares, so it satisfies the 'fixed for fixed' criterion and, therefore, it is classified as an equity instrument which requires the valuation of the liability component and the equity conversion component. The fair value of the liability component, included in current borrowings, at inception was calculated using a market interest rate for an equivalent instrument without conversion option. The discount rate applied was 25%.
On 5 March 2024 the Company announced that by an agreement dated 4 March 2024 it had agreed with the Lender to extend the repayment date for the £700,000 drawn down under the Facility to 31 July 2025 and that the £700,000 drawn down is now convertible by the Lender at the fixed price of 0.06 pence per share (the "New Conversion Price") (the "Extended Facility") .
The Company determined that the Extended Facility was in accordance with IFRS 9 not substantially different from the terms of the Modified Facility and that therefore the Modified Facility has not been deemed repaid when the Extended Facility terms were agreed.
10. |
Share capital |
|
|
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
|
£'000 |
£'000 |
|
Number |
|
|
|
Authorised |
|
|
|
7,500,000,000 ordinary shares of 0.002p each (1) |
150 |
100 |
|
5,000,000,000 deferred shares of 0.198p each (2) |
9,900 |
9,900 |
|
|
10,050 |
10,000 |
|
|
|
|
|
(1) This is the number of ordinary shares which the directors were authorised to issue at the AGM on 31 July 2023. This authority was increased to 11,000,000,000 shares at the AGM on 31 July 2024.
(2) The Deferred Shares have very limited rights and are effectively valueless as they have no voting rights and have no rights as to dividends and only very limited rights on a return of capital. The Deferred Shares are not admitted to trading or listed on any stock exchange and are not freely transferable.
|
|
Allotted ordinary shares, called up and fully paid |
|
|
|
As at beginning of the period |
101 |
101 |
|
Share subscription for cash |
102 |
102 |
|
Shares issued for exploration project acquisitions |
- |
- |
|
Shares issued on exercise of warrants |
- |
- |
|
Shares issued in lieu of directors' and PDMR fees |
10 |
10 |
|
Shares issued to settle finance costs |
1 |
1 |
|
Shares issued to settle consultants fees |
13 |
13 |
|
Total ordinary shares at end of period |
227 |
227 |
|
|
|
|
|
Allotted deferred shares, called up and fully paid (2) |
|
|
|
As at beginning of the period |
1,978 |
1,978 |
|
Total deferred shares at end of period |
1,978 |
1,978 |
|
Ordinary and deferred as at end of period |
2,205 |
2,205 |
|
|
Number of shares 30 June 2024 |
Number of shares 31 December 2023 |
|
|
|
Ordinary share capital is summarised below: |
|
|
|
|
|
As at beginning of the period |
11,380,918,869 |
5,081,399,113 |
|
|
|
Share subscription for cash (1) |
- |
5,075,000,000 |
|
|
|
Shares issued for exploration project acquisitions (2) |
- |
15,763,889 |
|
|
|
Shares issued to settle Directors' and PDMR fees (3) |
- |
475,590,222 |
|
|
|
Shares issued to settle finance cost (4) |
- |
87,500,000 |
|
|
|
Shares issued to settle consultants' fees (5) |
- |
645,665,645 |
|
|
|
As at end of period |
11,380,918,869 |
11,380,918,869 |
||
|
|
|
|
||
|
Deferred share capital is summarised below: |
|
|
|
|
|
As at beginning of the year (1) |
998,773,038 |
998,773,038 |
|
|
|
As at end of period |
998,773,038 |
998,773,038 |
|
|
|
|
|
|
|
|
|
Notes re shares issued during 2023 (1) (a) on 26 April 2023 the Company issued 1,875,000,00 shares to certain directors, investors and existing shareholders for £750,000 (b) on 18 December 2023 the Company issued 3,200,000,000 shares to certain directors, investors and existing shareholders for £800,000 (2) On 21 June 2023 the Company issued 15,763,889 shares in relation to the acquisition of Virgo Resources Ltd. (3) (a) On 26 April 2023 the Company issued 218,700,952 shares to settle fees due to Directors and persons discharging managerial responsibilities under Market Abuse Regulations (PDMRS) of £174,960. (b) On 18 December 2023 the Company issued 256,889,280 shares to settle fees due to Directors and PDMRS of £64,222 (4) On 21 June 2023 the Company issued 87,500,000 shares to settle finance fees of £70,000. (5) (a) On 13 January 2023 the Company issued 7,926,024 shares to settle fees due to a consultant of £6,000. (b) On 26 April 2023 the Company issued 246,808,068 shares to settle fees due to consultants of £101,250. (c) On 12 May 2023 the Company issued 104,875,000 shares to settle fees due to consultants of £41,950. (d) On 16 November 2023 the Company issued 44,056,553 shares to settle fees due to consultants of £20,700. (d) On 18 December 2023 the Company issued 242,000,000 shares to settle fees due to consultants of £60,500
|
|
|||
|
|
Unaudited |
Audited |
|
|
30 June 2024 |
31 December 2023 |
|
|
£'000 |
£'000 |
|
The share premium was as follows: |
|
|
|
As at beginning of period |
41,431 |
39,507 |
|
Share subscription for cash |
- |
1,448 |
|
Shares issued to settle consultants fees |
- |
218 |
|
Shares issued - Acquisitions |
- |
42 |
|
Shares issued - Finance cost |
- |
68 |
|
Shares issued to settle Directors' and PDMR fees[1] |
- |
230 |
|
Share issue costs (1) |
(51) |
(72) |
|
Warrants expired during period |
- |
31 |
|
Warrants exercised |
- |
- |
|
Warrants issued during period |
- |
(41) |
|
As at end of year |
41,380 |
41,431 |
|
(1) The share issue cost related to the fundraising in December 2023. Each fully paid ordinary share carries the right to one vote at a meeting of the Company. Holders of ordinary shares also have the right to receive dividends and to participate in the proceeds from sale of all surplus assets in proportion to the total shares issued in the event of the Company winding up. |
11. |
Reconciliation of operating loss to net cash outflow from operating activities |
|
|
|
|
Unaudited |
Unaudited |
|
|
Six months ended 30 June 2024 |
Six months ended 30 June 2023 |
|
|
£'000 |
£'000 |
|
|
|
|
|
Operating loss from all operations |
(487) |
(463) |
|
|
|
|
|
|
|
|
|
Share based payments |
53 |
|
|
Impairments |
75 |
|
|
Finance Charge - non cash |
64 |
|
|
Foreign exchange movement |
(21) |
- |
|
Shares issued - Directors fees |
- |
43 |
|
Share issued - Consultants |
- |
19 |
|
Shares issued - Legal/finance fees |
- |
70 |
|
(Increase)/decrease in receivables |
182 |
20 |
|
Increase/(decrease) in payables |
44 |
65 |
|
Net cash outflow from operating activities |
(90) |
(246) |
12. |
Subsequent events
|
|
On 16th July the Company announced that it had issued 158,222,188 new Ordinary Shares of 0.002p each to settle a total of £39,180 of accrued consultancy fees.
Other than the foregoing there are no significant events have occurred subsequent to the reporting date that would have a material impact on the consolidated financial statements. |
13. |
Availability of Interim Report |
|
A copy of these interim results will be available from the Company's registered office during normal business hours on any weekday at Floor 6, Quadrant House, 4 Thomas More Square, London E1W 1YW and can also be downloaded from the Company's website at www.bezantresources.com. Bezant Resources Plc is registered in England and Wales with company number 02918391. |