Final Results and Notice of AGM

Oriole Resources PLC

28 March 2024

 

Oriole Resources plc / Index: AIM / Epic: ORR / Sector: Mining

Oriole Resources PLC 

('Oriole' or 'the Company' or 'the Group')

Final Results and Notice of AGM

Oriole Resources (AIM: ORR), the AIM-quoted exploration company focussed on West Africa, announces its final results for the year ended 31 December 2023 (the 'Period').

Copies of the Company's Annual Report will be posted to shareholders on or before 15 May 2024 together with notice of the Company's Annual General Meeting ('AGM') which will be held at 11:00am BST on 24 June 2024 at the offices of Grant Thornton UK LLP, located at 30 Finsbury Square, London, EC2A 1AG.

Operational Highlights:

·    At the Mbe licence ('Mbe') in the Eastern Central Licence Package ('Eastern CLP'), results for a total of 19 channel-chip samples returned mineralised intervals across all six sample lines, with 11 samples grading over 1 gramme per tonne ('g/t') gold ('Au'). Best intervals included 5.00 metres ('m') at 2.03 g/t Au and 2.20m at 8.47 g/t Au, with mineralisation continuing into the wall rock;

·    Completion of an earn-in agreement with BCM International Limited ('BCM') in respect of the Bibemi licence ('Bibemi') in Cameroon, which has seen BCM make a signature payment of US$0.5 million ('M') and will see it invest up to US$4M into exploration and move Bibemi through the exploitation licence application phase, in return for up to a 50% interest in the licence;

·    Improvement in the independently calculated maiden JORC-resource at Bibemi to 375,000 Troy ounces ('oz') Au, grading 2.38 g/t in the JORC Inferred category;

·    Completion of a second earn-in agreement with BCM in respect of the Mbe licence in Cameroon, which has seen BCM make a signature payment of US$1M and will see it invest up to US$4M into exploration, in return for up to a 50% interest in the licence;

·    IAMGOLD Corporation announced that it had completed the sale of its interest in the Senala licence ('Senala') to Managem Group ('Managem'), a Moroccan-based mine developer and operator. Managem has continued to provide exploration funding under the pre-existing option agreement but has not reached the expenditure necessary to guarantee Managem a 70% ownership stake in the licence. Instead, following expiration of the option agreement in February 2024, Managem will hold an approximate 59% interest in the licence.

Financial Overview

·    Administrative expenses reduced by 4% to £1.13M (2022: £1.18M);

·    Cash outflow from operations reduced by 59% to £0.53M (2022: £1.31M) as the Group introduced cash saving measures throughout the Period;

·    Loss for the year of £2.27M (2022: loss of £1.57M) inflated by £0.42M impairment provision against the Company's holding in Thani Stratex Djibouti, a legacy asset, revaluation of the receivable from Lanstead Capital Partners L.P. ('Lanstead') at the year-end share price amounting to a fair value adjustment of £0.65M, and an adverse foreign exchange movement of £0.79M. These three items have no cash-flow implications.

Tim Livesey, CEO of Oriole, commented:   

"2023 was a year of consolidation in a very difficult market for junior explorers. 

"Our early focus in Cameroon was a review and revisit of our exploration targeting in the Eastern CLP and at Bibemi.  In both areas, programmes of ground geophysical data collection were carried out and, at the Eastern CLP, further field mapping and sampling was undertaken in order to improve our understanding of the mineralisation prior to the initiation of the next phases of work.   

"As we continued to see positive support for the concept of a mineralised gold corridor through the Eastern CLP, in particular with additional exposure of the mineralised system on the Mbe licence created by some small-scale artisanal activity, the projects in the Eastern CLP began to attract attention from a number of international mining groups, ultimately culminating in the signing of Heads of Terms agreements on both Bibemi and Mbe in November 2023. Definitive agreements for both projects were signed in January 2024.

"These agreements will deliver US$4M of exploration funding for each of the projects, in addition to a total of US$1.5M in signature payments directly to Oriole and Resource-definition based success payments.   

"At a time when the market capitalisation of the Company sat at around £3M, these two agreements demonstrated the highly undervalued nature of the Company, and also reconfirmed the technical capabilities of our team in both identifying and developing a maiden resource, and identifying a new potential gold district in Cameroon. 

"With a change of our Joint Venture ('JV') partner at Senala, following IAMGOLD's sale of its West African exploration assets, we also began our relationship with Managem, who will continue to explore the prospective Faré targets. 

"As we close out the year, we are very pleased to be one of the few junior explorers carrying out true greenfield exploration in a new jurisdiction, with cash in the bank and a strong partner funding and advancing exploration at two of our 11 licences in Cameroon." 

Chair's Statement

Dear Shareholder,

As a predominantly gold exploration company, I thought it would be useful to look at the underlying trends supporting the current increase in the price of gold which, at the end of 2023 stood at US$2,078/oz compared to the previous year end of US$1,823/oz. The price of gold has continued to rise this year, reaching a peak of US$2,203/oz on 20 March 2024. There are several reasons for this increase in price, the main one being the continued demand for bullion by Central Banks who made net purchases of 1,037 tonnes ('t') during the year, being just a little short of the 2022 record. Of this amount, China bought 225t and now holds the largest amount of gold, reaching over 33,000t split equally between State and private investors. The reason behind this buying is primarily linked to the geopolitical situation which did not improve in 2023, with the continuing Russian invasion of Ukraine and now the added conflict in the Middle East. The People's Republic of China, having seen the sanctions imposed upon Russia, has reduced its US dollar dependency and, as a consequence, continues to build its bullion reserves. In a similar fashion, the BRICS countries have decided to also use bullion as a basis for international exchange, a role previously held by the US dollar and the Euro.  Many countries now support 'de-dollarisation' and physical gold is seen as the only guarantee of economic and political independence. It is therefore likely that Central Banks will continue their demand for bullion.

In addition to this trend away from dollars, the continued break in supply chains due in part to on-going Panama and Suez situations, has led to an increase in the cost of goods, which the increased cost of oil and gas has only aggravated. Although Western governments have managed to curtail the relatively high rate of inflation experienced in the recent past, there is some concern that prices will not return to the levels previously seen. As a consequence, gold, which has always been seen as the top hedging instrument against inflation, should continue to be prized as an asset to be held and so one might expect the price to continue its upward trajectory. As with everything though, nothing is guaranteed in today's economic and political environment.

The positive news on the gold price was not reflected in the investment attitude towards the junior exploration end of the London market and Oriole was faced with an uphill struggle to finance operations throughout the year. I was happy to invest in the Company in April 2023 and hope that my investment demonstrated my belief in our assets and our team. In addition to my investment, the Board of Directors took shares and options in part payment of their salaries/fees and the extent of these actions has increased the Board's ownership to 6.6% of the share capital of the Company. I am pleased to report that our cash position has significantly improved with the signing of the two agreements with BCM and since year end, we have received signature payments totalling US$1.5M from BCM and exploration has already begun at both the Bibemi and Mbe projects.

In addition to the BCM earn-in deals, we also entered an agreement with Lanstead in August 2023, whereby they bought 930 million shares at a notional price of 0.19 pence ('p') per share, which was significantly above the then market price of the shares which stood at 0.15p. The sale proceeds were, in effect, repaid to Lanstead who then undertook to repay the proceeds in 24 monthly instalments based on the prevailing share price each month. The main reason for entering into this form of transaction was because the Board strongly believed that a deal would be struck with the Cameroon assets that would significantly improve the underlying value of the Company and which would be reflected in an increased share price. The repayments began in September and the first four months were, as expected, lower than the benchmark receipt.  However, since the year end, the receipts from Lanstead have significantly increased, sitting at or above the benchmark amount, and we are hopeful that results from our exploration efforts will continue to drive our share price higher.

These transactions mean that our exploration work at Bibemi and Mbe is fully funded by up to US$4M on each asset and our UK overheads are covered by the monthly receipts from Lanstead. In addition, the signature payments received will help to fund our exploration work elsewhere in Cameroon, although we continue to seek partners for our other licences in both Cameroon and Senegal in order to defray both costs and risks in our asset portfolio.

Due to the constrained cash position in 2023, exploration throughout the Period was limited, although we did manage to undertake a geophysical work programme over Bibemi that has identified further potential areas for exploration and assisted with the location of drill holes for the upcoming BCM-funded drilling programme. At Mbe, we also undertook a geophysical survey and undertook selective rock-chip and limited channel-chip sampling which has further demonstrated the gold potential in not only the vein but also the host rock.

In January of this year, BCM undertook a more representative sampling campaign at Mbe, as part of its due diligence review, and were delighted with the results achieved thus far, supporting our contention that this is potentially a new gold frontier in Africa.  At Bibemi, we will shortly commence an approximate 7,000 metre drilling campaign that will test both the existing gold Mineral Resources Estimate ('MRE') at Bakassi Zone 1, through infill and extension drilling, as well as at new geophysics targets along strike. The drilling will hopefully add to the global MRE for the project, which currently sits at 375,000ozs grading 2.30 g/t Au in the JORC Inferred category.

Should the drilling confirm additional ounces, and subject to the mining studies proving positive, it is envisaged that the deposit will be mined from surface as an open pit operation. Our partner, BCM, is ideally placed to assist with the development of this operation and it is currently our intention to submit an application for a mining licence over this area during 2024. Infrastructure in the area is conducive to development and capital expenditure will eventually be focussed on the plant and mining fleet rather than construction of roads etc.

Meanwhile, the work programme at Mbe will focus on soil and trench sampling with a view to drilling initial targets during the next dry season. Results to date from this licence are extremely encouraging and will aid exploration on our other four licences within the Eastern CLP. Elsewhere, we will continue our exploration at Gamboukou, to review the lithium potential, continue to discuss the accessibility of our Western CLP licences, currently under voluntary suspension, and await the signature of our Wapouzé licence to the north of Bibemi where there appears to be significant potential for limestone extraction for cement. 

In Senegal, the second option period over the Senala licence has now ended and Managem appears to have earned in to approximately 59% of the licence; with a review of the expenditure to confirm this position underway. According to the original agreement, the next steps include the formation of a JV company to manage the asset going forward, and the review and approvals for workplans and budgets.  Oriole has the option to contribute or dilute at that stage.

We also continue to pursue sums due in respect of our legacy assets in Turkey and we will update the market as and when any progress is made. 

With the two exploration programmes now underway in Cameroon, and results expected in the coming months, this is a very exciting time for the Company.

Turning next to our share price, which has continued to fluctuate, hitting a high of 0.50p in January 2024 from a low of 0.0722p in November 2023, it now sits at around 0.25p, giving a market capitalisation of £9.7M. I do not believe this is a fair reflection of the worth of the Company and I am forever hopeful that the market will reward good results when they begin to arrive. We shall also continue to seek value enhancing transactions whilst we pursue our exploration efforts in Cameroon. The current market for junior exploration companies remains challenging, but we shall continue to persist and I am confident that positive market sentiment will return.

Before signing off, I must thank the team at BCM who shares our vision for the potential of a new gold district in Cameroon. This is not my first venture with Paul List and his team and I am pleased that we are working together again on two such exciting projects. I would also like to thank the team at Managem, as I recognise that to integrate a group of assets positioned in three West African countries is not an easy feat, and I look forward to working together in order to maximise our value in Senegal.

I would also like to say how glad I am for the continuing support and sound advice given to the Company by our High Commissioner in Cameroon and understand that the UK has recently entered into various trade deals with Cameroon, which can only help with the continued economic development of that country. Likewise, we are pleased with the help given by the Governments of both Cameroon and Senegal in moving our assets forward. Our partner in BEIG3 continues to offer enormous assistance with logistics, which has been, and will continue to be, crucial during this next phase of exploration in Cameroon. Our partners at EMC have also been of great assistance in helping with the renewal process for our Senala licence in Senegal.

I must also recognise that our teams on the ground in Cameroon and in the UK are the bedrock of the Company and I appreciate their efforts during a difficult period. I look forward to continuing our work together to make this coming year a success.

Finally, the Board deserves a special vote of thanks as there have been hard days in 2023 with a heavy workload and little else.  I am hoping that now we are funded with an exciting work programme ahead, 2024 will be a much better year for us all. Which brings me finally to our shareholders who, I suspect, are battered and bruised but hopefully now a little more optimistic of a brighter future. Please be assured that the Board and management are working extremely hard to make your Company a success and I rather believe that this year will be the turning point.

Eileen Carr

Non-Executive Chair

27 March 2024

Extracts from the Strategic Report

Principal Activities

The principal activity of the Group is the exploration and development of gold and other high-value base metal projects.

Strategic approach

The Board's strategy is to establish the Company as a leading value-adding project-generator in our chosen mineral specialisations and in our geographic areas of operation. The Board seeks to acquire exposure to highly-prospective districts, primarily in West and Central Africa, and the Group has developed a first-mover position in Cameroon, an exciting new frontier for gold-exploration. The Board aims to develop a portfolio of projects that cover a range of mineral deposits across multiple jurisdictions, thus mitigating sovereign, technical and operational risks.

The Group finances its activities through the monetisation of more advanced projects, project specific investment agreements and through periodic capital raisings if necessary.

Business environment

The price of gold fluctuated during the year but remained above US$1,800/oz throughout, and currently sits at a 10-year high. The continued global uncertainty, with conflict in Ukraine and the Middle East, is expected to provide continued strong demand for gold during 2024, which is important for Oriole as its projects move forward towards the mine development phases. However, a strong demand for gold does not necessarily translate into a good environment for early-stage gold explorers, and 2023 continued to be a challenging environment for the junior exploration companies looking to raise funds via traditional equity placings.

The Board continues to believe that the global demand for gold, and the need for new resources, will ultimately drive an increased appetite for the main gold producers to support the activities of junior exploration companies like Oriole.

We were saddened to hear that Cameroon's Minister of Mines, Industry and Technological Development, Gabriel Dodo Ndoke, passed away suddenly on the morning of 18 January 2023. Interim Minister, Dr. Calistus Gentry Fuh has been appointed, and we have been working effectively with the Minister and his team throughout the year.

2023 Operations and progress

The Group's main operations are split between active exploration projects in Cameroon, partner exploration activities in Senegal, and the management of its investment and royalty positions. Much of 2023 was dominated by the search for funding, culminating in reaching an agreement with Lanstead to provide a two-year equity funding mechanism, and the signing, early in 2024, of two agreements with BCM in respect of the Group's Bibemi and Mbe projects. These latter two agreements fulfilled a long-held strategy of attracting project-level funding as a means to more appropriately reflect the underlying value of the Group's assets than was being recognised by the overall market capitalisation of the Group. The Directors continue to look for further avenues for project-level funding.

Active exploration projects

The primary focus for the Group's own exploration activities is its position in Cameroon.

Bibemi

In December 2022, the Company reported a maiden JORC-compliant Resource of 305,000 oz grading 2.19 g/t Au for Bakassi Zone 1, one of four prospects at the project. Since year end, the rising gold price led to an upward revision of the existing Resource to 375,000 oz grading 2.30 g/t Au (announcement dated 15 January 2024). The MRE remains open at depth and along strike to the northeast, and there exists significant potential to expand the Resource at Bakassi Zone 1 and to identify additional resources at the other three prospects on the licence, Bakassi Zone 2, Lawa West and Lawa East, which are all located within a few kilometres ('km') of Bakassi Zone 1.

After long-running discussions with BCM, agreement on Heads of Terms was reached in November 2023 and a full Earn-in agreement signed on 5 January 2024. This provided Oriole with US$500,000 in signature payments and allows BCM to earn into a 50% ownership position upon completion of US$4M of investment into the project, and resources-definition based success payments. This investment will allow the Group to commence Phase 5 drilling at Bibemi in 2024 with a view to increasing the existing Resource and moving towards submission of an application for an exploitation licence later this year. Local-level technical studies, including a baseline Environmental Impact Assessment ('EIA'), have already commenced. The infill ground magnetics programme completed during Q2 provided more complete and detailed coverage than the prospect-level data acquired in 2022. This has identified a number of further targets at Bibemi, two of which will be tested during the upcoming Phase 5 drilling programme alongside infill and extension drilling at the Bakassi Zone 1 MRE zone.

Central Licence Package

Covering Paleo-Proterozoic to Neoproterozoic (including Pan-African) age rocks, well-known hosts for orogenic gold deposits both in West Africa and worldwide, the CLP licences were initially targeted by the Company's technical team due to their apparent proximity to the dominant regional shear corridor associated with the Tcholliré-Banyo Shear Zone ('TBSZ'), a major southwest-northeast-trending splay off the larger-scale Central African Shear Zone. The TBSZ and its associated shears, thrusts and faults are thought to be one of the most significant structural controls for gold and other mineralisation in the region. 

With the grant of the initial eight licences in the package in February 2021, follow-on work to the early stream sediment sampling programmes has continued to focus on the five licences designated as the Eastern CLP (Tenekou, Niambaram, Pokor, Ndom and Mbe).

In 2022, semi-regional soil sampling over the five Eastern CLP licences identified multiple 2-3km long anomalies across the Ndom, Pokor, and Niambaram licences. At Mbe, a c.12.5km long by 3km wide gold-mineralised corridor ('MB01') was identified and during Q4-22, the team completed regolith and lithological mapping (1:15,000 scale) as well as selective rock-chip sampling over outcropping rocks, predominantly quartz veins. This work resulted in the identification of a north-northeast trending corridor comprising sulphide-rich and locally brecciated quartz veins within strongly altered and mineralised felsic porphyry host rocks. Selective sampling over outcropping quartz veins in Q1 delivered grades up to 134.10 and 131.80 g/t Au. 

The results to date appear to support the team's hypothesis that the Eastern CLP area is host to a wide (15 to 20km) corridor of gold mineralisation, stretching along an approximate 70km-long segment of the TBSZ.

In 2023, the Group focussed its exploration efforts on Mbe, in order to showcase the potential of the whole Eastern CLP. Analysis of a further 493 soil samples over Grid 6 at Mbe during H1 2023 returned an anomalous sample of 257 parts per billion ('ppb') Au and seems to have identified the south-westerly extent of the 12.5km long gold-in soil anomaly.

A ground-based geophysics programme has been completed over the entire gold anomalous zone at Mbe to test the local and regional scale structures at depth and to help develop the geological model. The survey was conducted by our own field teams at a line-spacing of 100m and provided high-quality data that has now been interpreted to assist with drill target identification.

During 2023, minor artisanal pits exposed trench-like profiles at six locations over a 200m strike length of one of the shear veins at MB01. The hand-dug workings enabled the collection of channel-chip samples on short 2-5m wide lines that are approximately perpendicular to the dominant north-east shear trend and provide a small window into the much wider corridor of mineralised veins. Results for a total of 19 channel-chip samples (22 including QAQC) returned mineralised intervals across all six sample lines, with 11 samples grading over 1 g/t Au. Best intervals (using a 0.30 g/t Au cut off) included; MBTR01: 2.20m at 8.47 g/t Au; MBTR02: 5.00m at 0.90 g/t Au; MBTR04: 5.00m at 2.03 g/t Au and MBTR05: 2.10m at 3.69 g/t Au.

Mineralisation was returned from a range of host rocks including variably brecciated shear and extensional quartz veins and altered wall rock. The highest grade returned from a wall rock sample was 5.94 g/t Au over 0.90m, within the MBTR05 interval, suggesting the potential for near-surface bulk-mineable mineralisation. 

Late in 2023, the Company's ongoing discussions with BCM in respect of the Bibemi project grew to encompass project level funding for the Mbe licence, culminating in a Heads of Terms agreement with BCM being signed in November 2023 and the full Earn-in agreement being signed in January 2024. The Group has received US$1M as a payment on signature and work has already commenced in the field in respect of BCM's US$4M investment into exploration at Mbe for which they will earn a 50% ownership position in the licence, subject to also making any resource-based success payments that are due. It is anticipated that exploration success at Mbe will further enhance investment interest in the other four licences in the Eastern CLP and the Group intends to progress these licences during 2024, whilst seeking further project-level funding arrangements.

Lithium

In November 2022, the Company reported that geochemical data from its soil sampling programmes had identified a lithium-in-soil anomalism at the Ndom licence (part of the Eastern CLP), with two parallel zones, each extending over an approximate 9 km strike length and associated with units mapped regionally as porphyritic granitoid. In the same month, the Company secured the Gamboukou licence, immediately to the south of Ndom, on the basis of it having similar lithium-prospective geology.

During H1 2023, the team completed reconnaissance exploration and mapping at the Ndom and Gamboukou licences, in order to assess their potential to host lithium-bearing pegmatites, and confirmed multiple pegmatite veins within the granitoids and the older basement rocks. Sampling programmes continued at Ndom through the remainder of the year and further work to qualify these areas as lithium prospects is planned for 2024.

Wapouzé

A review of the historical data in 2022, determined that gold prospectivity at Wapouzé was lower than that at the Group's nearby Bibemi project but highlighted the potential for cement-quality limestone within the licence area. Thirteen out of fourteen rock chip samples returned suitable chemistry to be classified as high-grade carbonate material, suitable for use within the cement industry (an industry in Cameroon which is believed to be worth in the order of £700M per year, largely supported by import), which provided support for Oriole to request a change of commodity for the licence during the renewal process. This process is still ongoing but, once granted, Oriole will look to secure an industrial minerals partner to develop the Wapouzé project through to exploitation on an expedited basis, from which Oriole will look to secure a royalty-stream.

Senala

In December 2022, our earn-in partner at the Senala licence in Senegal, IAMGOLD, announced the pending sale of its West African assets, including its stake in Senala, to Managem, a Moroccan based mining company. The sale moved to completion in March 2023 and Managem continued funding of the earn-in on Senala under the terms of the 2018 Option Agreement (announcement dated 1 March 2018), with the option to earn up to a maximum 70% interest in the project by February 2024, subject to a total spend of US$8M. The Option Agreement, has now reached its full term and a review of expenditure is underway in order to confirm Managem's ownership position, expected to be around 59%. Discussions regarding the future exploration and joint-operatorship of the licence are underway.

Investment and royalty positions

The Company has a long history of gold and base metal exploration success. This history has left it with a potentially valuable portfolio of legacy assets, which are the subject of an on-going asset realisation programme.

One of these assets, an 8.03% holding in Thani Stratex Djibouti ('TSD'), arises from a legacy JV agreement between the Company, whilst under previous management, and Thani Ashanti. Whilst the project is still active, and highly prospective, progress under the new arrangements has been slow and with funding for the exploration industry as a whole proving to be very difficult, the Board has made full provision against the value of this investment, whilst still remaining hopeful of an eventual return to its shareholders.

The Group remains committed to realising value from its interests in Turkey, with potentially US$1.6M and Turkish Lira 3.75M (together, £1.3M) to be collected from the agreements that are in place with former partners. At the Group's former Karaaǧaç gold project in Turkey, pursuit of the US$425k owed by the operator, Anadolu Export ('Anadolu'), is still ongoing although progress through the courts is painfully slow.

The Group is also awaiting news of a debt owed by NTF Insaat Ticaret Ltd Sti ('NTF'), a former partner in Turkey, who defaulted on tax payments that were originally due in 2017. Further depreciation of the Turkish Lira against the Dollar has now reduced this receivable to US$115k.

Meanwhile, work continued at the Hasançelebi project. The Group is due to receive US$500k from its partner Bati Toroslar when this project passes EIA stage, and a further US$220k once mine construction commences.

At the Muratdere copper project in Northern Turkey, the Company holds a 1.2% net smelter return royalty position. The EIA Report for this project has been submitted to the State Authority by Muratdere Madencilik, and was approved by the State in August 2022, but has been subject to an ongoing appeals process. Oriole has engaged with a number of royalty companies with regards to the sale of its royalty rights, and believes successful confirmation of the EIA will prove to be a trigger for a sale of this asset.

Financial Review

As noted earlier, 2023 was a particularly challenging year for junior exploration funding but the Group has managed to enter 2024 having secured significant funding for its operational expenses and for the comprehensive exploration plans in Cameroon. In such challenging times, the Board has invested into the Group throughout the year, with a direct placing by Eileen Carr, salary sacrifice schemes (undertaken by the entire Board) running for most of the year in relation to shares and share options, and the simple method of deferring salary.

Following discussion with the Group's financial advisors about their experience of raising funds in 2023, which had seen deep discounting of share prices in order to attract investment, the Board decided to try an alternative equity funding route, one which would leverage the potential upside in the share price that could be foreseen as discussions regarding the introduction of project-level funders advanced.

Accordingly, the Group entered into an arrangement whereby 930 million new Ordinary Shares were issued to Lanstead (at a notional value of 0.19p per share) in exchange for 24 monthly repayments from a 'Sharing Agreement', those monthly repayments being based upon the prevailing monthly share price and its variance against a reference price of 0.253p per share. Whilst the mechanics of the Sharing Agreement are complex, essentially the funds received monthly are £74k plus or minus a percentage equal to the variance from the reference price. Whilst complex arrangements like this are unpopular with investors, as appeared to be proven in the early months post-signature, the Board's belief that positive news would make the arrangement beneficial to the Group has been borne out following the completion of the BCM deals. Based on returns received to date, against the shares to which those returns relate, the average price per share from the Sharing Agreement is 0.18p at the time of writing, significantly in excess of what could have been achieved from an equity placing to the market in 2023. The proceeds of the Sharing Agreement are to be used primarily to provide funding for the Group, as Oriole continues its strategy of seeking joint-venture partnerships and project-level financing. Excess funds will be directed towards exploration spend on the Group's projects.

The accounting for the Lanstead Agreement reflects IFRS stipulations that such financial instruments should be 'marked to market' at the Period reporting date, and so a £652k fair value adjustment arose at the year end and was recognised as a loss in the statement of comprehensive income, based on the remaining amounts receivable using the year end share price as a reference. Such was the impact of the BCM deals on the share price, that 'marking to market' based on the price one month later, would have seen a fair value uplift of £471k, instead of a loss of £652k.

This 'marking to market' fair value movement contributed to a Group loss for the year of £2,269k (2022: £1,569k). Also included in that figure is the £416k provision made against the debt due from Thani Stratex Djibouti, following the Board's decision to make full provision against the investment in TSD. A year-on-year adverse forex movement of £788k on our Euro denominated assets in Senegal, is the other significant factor in understanding the movement between the two periods. These three items contributed to the 'other losses' line of £1,304k (an adverse swing of £1,958k against the prior year).

In areas which are more directly under our control, administration expenses fell by 5% to £1,129k (2022: £1,182k), as a result of cost saving measures implemented to maximise available funds for exploration and minimise monthly cash burn. Included within the 2023 administrative expenses is an accounting charge of £182k for 'share based payments', which is a non-cash item required under IFRS to reflect the potential value of share options issued to Directors and employees. This figure is inflated from its normal levels, for example in 2022 the charge was £8k, due to the extensive salary sacrifice for share options scheme implemented during the year, which saved £60k of cash flow in the second half of the year. Consequently, on a cash basis, cash flows from operational activities reduced by 59% to £531k (2022: £1,305k).

The Group continues to reclaim research and development tax credits, with £158k received in the year reflecting 2022's exploration activities. Work is underway to submit the 2023 tax computations, although the 2022 level is unlikely to be repeated due to lower levels of exploration during the Period.

The Group enters 2024 in a much stronger financial position than it was in for much of 2023. With monthly incoming funds from the Lanstead Agreement, and an excellent partner providing funding on two of our licences in Cameroon, the Board remains convinced that the share price does not yet fully reflect the progress that has been made across the Group's portfolio. However, with field work underway, the prospects for the Group are excellent and hindsight will show 2023 to have been a difficult but ultimately transformational year.  

Tim Livesey

Chief Executive Officer

27 March 2024

Financial Statements

Statement of consolidated comprehensive income

				Year ended 31 December 2022 £'000
			Year ended 31 December 2023 £'000
Continuing operations
Administration expenses			(1,129)	(1,182)
Other (losses)/profits			(1,304)	654
Operating loss			(2,433)	(528)
Financial income			6	5
Share of losses and impairment of associates			-	(1,449)
Loss before income tax			(2,427)	(1,972)
Tax credit			158	403
Loss for the year			(2,269)	(1,569)
Other comprehensive income for the year
Items that may be subsequently reclassified to profit or loss
Exchange differences on translating foreign operations			36	(100)
Change in fair values of other financial assets			(395)	-
Other comprehensive income for the year, net of tax			(359)	(100)
Total comprehensive loss for the year			(2,628)	(1,669)
Loss for the year attributable to:
Owners of the Parent Company			(2,221)	(1,616)
Non-controlling interests			(48)	47
Loss for the year			(2,269)	(1,569)
Total comprehensive loss for the year attributable to:
Owners of the Parent Company			(2,580)	(1,716)
Non-controlling interests			(48)	47
Total comprehensive loss for the year			(2,628)	(1,669)
Earnings per share for losses from continuing operations attributable to the equity holders of the Company (expressed in pence per share).
- basic and diluted			(0.07)	(0.07)

Statement of consolidated financial position

			As at 31 December 2022
		As at 31 December 2023
		£'000	£'000
ASSETS
Non-Current Assets
Property, plant and equipment		8	33
Intangible assets (note 4)		10,766	10,559
Financial assets at fair value through other comprehensive income (note 3)		-	395
Financial assets at fair value through profit and loss (note 3)		395	-
Trade and other receivables		-	440
Total Non-Current Assets		11,169	11,427
Current Assets
Financial assets at fair value through profit and loss (note 3)		593	-
Trade and other receivables		132	196
Cash and cash equivalents		114	507
Total Current Assets		839	703
Total Assets		12,008	12,130
EQUITY
Equity attributable to owners of the Company
Share capital		8,070	6,929
Share premium		25,804	24,980
Other reserves		1,336	1,513
Retained earnings		(23,520)	(21,299)
Total equity attributable to owners of the Company		11,690	12,123
Non-controlling interest		(289)	(241)
Total Equity		11,401	11,882
LIABILITIES
Current Liabilities
Trade and other payables		607	248
Total Liabilities		607	248
Total Equity and Liabilities		12,008	12,130

Statement of consolidated changes in equity

		Attributable to owners of the Company										Non-Controlling Interest
		Share Capital		Share Premium		Other Reserves		Retained earnings		Total			Total Equity
		£'000		£'000		£'000		£'000		£'000		£'000	£'000
Balance at 1 January 2022		6,200		24,758		1,606		(19,838)		12,726		(133)	12,593
Comprehensive income for the year:
- loss for the year		-		-		-		(1,616)		(1,616)		47	(1,569)
- other comprehensive income		-		-		(100)		-		(100)		-	(100) -
Total comprehensive income for the year			-		-		(100)		(1,616)		(1,716)	47	(1,669)
Issue of share capital net of expenses		729		222		-		-		951		-	951
Share-based payments		-		-		8		-		8		-	8
Share options lapsed		-		-		(1)		-		(1)		-	(1) 1)
Transfer between reserves		-		-		-		155		155		(155)	-
Total contributions by and distributions to owners of the Company		729		222		7		155		1,113		(155)	958
Balance at 31 December 2022		6,929		24,980		1,513		(21,299)		12,123		(241)	11,882
Comprehensive income for the year:
- loss for the year		-		-		-		(2,221)		(2,221)		(48)	(2,269)
- other comprehensive income		-		-		(359)		-		(359)		-	(359)
Total comprehensive income for the year		-		-		(359)		(2,221)		(2,580)		(48)	(2,628)
Issue of share capital net of expenses		1,141		824		-		-		1,965		-	1,965
Share-based payments		-		-		182		-			182	-	182
Total contributions by and distributions to owners of the Company		1,141		824		182		-		2,147		-	2,147
Balance at 31 December 2023		8,070		25,804		1,336		(23,520)		11,690		(289)	11,401

Statement of consolidated cash flows

			Year ended 31 December 2022
		Year ended 31 December 2023
		£'000	£'000
Cash flow from operating activities:
Net cash used in operating activities		(531)	(1,305)
Cash flow from investing activities:
Purchase of property, plant and equipment		-	(10)
Purchase of intangible assets		(329)	(842)
Tax received		158	403
Interest received		6	5
Net cash used in investing activities		(165)	(444)
Cash flow from financing activities:
Net funds received from issue of shares		303	895
Net cash generated from financing activities		303	895
Net decrease in cash and cash equivalents		(393)	(854)
Cash and cash equivalents at beginning of the period		507	1,361
Cash and cash equivalents at end of the period		114	507

Notes to the consolidated financial statements

1.      Basis of preparation

The financial statements have been prepared in accordance with IAS-adopted international accounting standards, IFRIC interpretations and those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention as modified by the measurement of certain investments at fair value and have been prepared on a going concern basis.

The financial information set out in this announcement does not constitute the Group's statutory accounts for the year ended 31 December 2023 or the year ended 31 December 2022 under the meaning of Section 434 of the Companies Act 2006 but is derived from those accounts. Statutory accounts for the years ended 31 December 2023 and 31 December 2022 have been reported on by the Independent Auditors.  The Independent Auditors' Reports on the Annual Report and Financial Statements for 2023, was unmodified and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006. The Independent Auditors' Reports on the Annual Report and Financial Statements for 2022, was unmodified and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006, but did include a material uncertainty in relation to going concern.

The statutory accounts are available at www.orioleresources.com and will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The statutory accounts for the year ended 31 December 2022 have been filed with the Registrar of Companies.

It is the prime responsibility of the Board to ensure the Company and the Group remains a going concern. At 31 December 2023 the Group had cash and cash equivalents of £114k and no borrowings. However, the Group had signed Heads of Terms agreements with BCM International Limited that became binding agreements in January and February 2024 (the 'BCM Agreements').   The BCM Agreements provided payments of $1.5M to the Group, received in full at the date of this report, and provide $8m of exploration funds across two licences.

Alongside this, in August 2023, the Group had signed an equity funding agreement with Lanstead Capital Investors L.P. (the 'Lanstead Agreement') that provides monthly income until August 2025 based upon the prevailing monthly share price.

Having considered the funds received from the BCM Agreements and the likely funds to come from the Lanstead Agreement, together with the prospects for asset disposals, the Group's ability to implement cash preservation measures, as was done in 2023, and having considered the Group budgets, the Directors consider that they will have access to adequate resources in the 12 months from the date of the signing of these financial statements. As a result, they consider it appropriate to continue to adopt the going concern basis in the preparation of the financial statements. There can be no assurance that the cash received from the Lanstead Agreement and asset sales will match the Board's expectations, and this may affect the Group's ability to carry out its work programmes as expected. Should the Group and Company be unable to continue trading as a going concern, adjustments would have to be made to reduce the value of the assets to their recoverable amounts, to provide for further liabilities which might arise and to classify non-current assets as current. The financial statements have been prepared on the going concern basis and do not include the adjustments that would result if the Group and Company were unable to continue as a going concern.

2.     Segment reporting

The Group's main operations are located in West Africa, Turkey and East Africa. The Group's head office is located in the UK and provides corporate and support services to the Group and researches new areas of exploration opportunities. The management structure and the management reports received by the Directors and used to make strategic decisions reflect the split of operations.          

a)     The allocation of assets and liabilities by segment is as follows:
				Exploration										UK support & other	Group
				Turkey		East Africa				West Africa					Total
				£'000		£'000				£'000				£'000	£'000
At 31 December 2023
Intangible assets				-				-			10,766		-		10,766
Property, plant and equipment				-				-			2		6		8
Cash and other assets				18				-			98		1,118		1,234
Liabilities				(1)				-			(47)		(559)		(607)
Inter-segment				(3,313)				-			(3,697)		7,010		-
Net assets/(liabilities)				(3,296)				-			7,122		7,575		11,401
					Exploration									UK support & other	Group
					Turkey		East Africa				West Africa				Total
					£'000		£'000				£'000			£'000	£'000
At 31 December 2022
Intangible assets					-				-			10,559	-		10,559
Property, plant and equipment					-				-			23	10		33
Cash and other assets					30				835			173	500		1,538
Liabilities					(1)				-			(69)	(178)		(248)
Inter-segment					(3,304)				-			(3,341)	6,645		-
Net assets/(liabilities)					(3,275)				835			7,345	6,977		11,882

b)     The allocation of profits and losses for the year by segment is as follows:

			Exploration						UK support  & other	Group
			Turkey	East Africa		West Africa				Total
			£'000	£'000		£'000			£'000		£'000
2023
Administration expenses			(13)		-		(61)	(1,047)			(1,121)
Depreciation charge			-		-		(1)	(7)			(8)
Other income/(losses)			6		(416)		-	(639)			(1,049)
Exchange losses			-		-		(216)	(33)			(249)
Inter-segment charges			-		-		(274)	274			-
Tax credit			-		-		-	158			158
Profit/(loss) for year			(7)		(416)		(552)	(1,294)			(2,269)

			Exploration						UK support & other	Group
			Turkey	East Africa		West Africa				Total
			£'000	£'000		£'000			£'000		£'000
2022
Administration expenses			(39)		-		(183)	(952)			(1,174)
Depreciation charge			-		-		(1)	(7)			(8)
Other income/(losses)			49		-		79	(8)			120
Share of associate company losses and  impairment of associate			-		(1,449)		-	-			(1,449)
Exchange gains			1		-		492	46			539
Inter-segment charges			-		-		(274)	274			-
Tax credit			-		-		-	403			403
Profit/(loss) for year			11		(1,449)		113	(244)			(1,569)

3.     Financial assets

	Group
	2023	2022
	£'000	£'000
Financial assets at fair value through profit and loss recoverable after more than one year	395	-
Financial assets at fair value through profit and loss recoverable within one year	593	-
Financial assets at fair value through other comprehensive income	-	395
At 31 December	988	395

Financial assets at fair value through profit and loss reflect the amounts due under the Lanstead Sharing Agreement, valued at the year-end share price.

Financial assets at fair value through other comprehensive income in the prior year comprised an 8.03% investment in Thani Stratex Djibouti Limited, against which full provision has been made during the current year.

4.     Intangible assets

The Group's Intangible assets comprise entirely of exploration assets.

	Group
	2023	2022
Cost	£'000	£'000
Cost at 1 January	10,559	9,376
Exchange movements	(139)	325
Additions	346	858
At 31 December	10,766	10,559

The capitalised cost of the principal projects and the additions during the year are as follows:

		Capitalised cost			Additions in year
			2023	2022	2023	2022
			£'000	£'000	£'000	£'000
West Africa
	Senala		6,363	6,502	-	-
	Cameroon		4,403	4,057	346	858
Total Intangible assets			10,776	10,559	346	858	10,490,725

** ENDS **

Competent Persons Statement 

The Technical Information relating to Exploration Results has been prepared by Claire Bay, EurGeol, CGeol, MIMMM, an employee of the Company, who is a Competent Person as defined by the JORC Code 2012 Edition. The information is extracted from various source reports. The Company confirms that it is not aware of any new information or data that materially affects the information included in the relevant market announcements. The Company confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcements.

The Technical Information relating to Mineral Resources and Exploration Targets is based on data compiled by Mr. Robert Davies, EurGeol, CGeol, an independent consultant to Oriole. Mr Davies is a Director of Forge International Limited. Mr Davies has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Davies consents to the inclusion in this presentation of the matters relating to the Mineral Resource Estimate and Exploration Target for Faré South in the form and context in which they appear. The Company confirms that the material assumptions and technical parameters for resource estimates continue to apply and have not materially changed.

It is noted that the potential quality and grade of the Exploration Targets referenced in this report are conceptual in nature. There has therefore been insufficient exploration to estimate a Mineral Resource for all target areas reported and it is uncertain whether further exploration will result in the estimation of a Mineral Resource. The Exploration Targets have been prepared in accordance with the 2012 edition of the JORC Code.

For further information please visit www.orioleresources.com, @OrioleResources on X, or contact:

Oriole Resources PLC Bob Smeeton / Tim Livesey / Claire Bay	Tel: [phone]
BlytheRay (IR/PR contact) Tim Blythe / Megan Ray	Tel: [phone]
Grant Thornton UK LLP Samantha Harrison / Ciara Donnelly	Tel: [phone]
SP Angel Corporate Finance LLP Ewan Leggat / Harry Davies-Ball	Tel: [phone]

Notes to Editors:

Oriole Resources PLC is an AIM-listed gold exploration company, operating in West Africa. It is focussed on early-stage exploration in Cameroon, where the Company has reported a Resource of 375,000 oz Au at 2.30g/t in the JORC Inferred category at its 82.2%-owned Bibemi project and has identified multi-kilometre gold and lithium anomalism within the district-scale Central Licence Package project. BCM International is currently earning up to a 50% interest in the Bibemi and Mbe licences in return for a combined investment of US$1.5m in signature payments, up to US$8m in exploration expenditure, as well as JORC resource-based success payments.

At the Senala gold project in Senegal, AGEM Senegal Exploration Suarl ('AGEM'), a wholly-owned subsidiary of Managem Group, has recently completed a six-year earn-in to acquire an estimated 59% beneficial interest in the Senala Exploration Licence by spending an estimated US$5.8 million. A review of expenditure and discussions on the formation of a joint-venture company are currently underway. The Company also has several interests and royalties in companies operating in and Turkey that could deliver future cash flow.

 

END