Interim Results

RNS Number : 3823U

Technology Minerals PLC

28 March 2023

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain. 

28 March 2023

Technology Minerals Plc

("Technology Minerals" or the "Company") 

Interim Results

Technology Minerals Plc (LSE: TM1), the first listed UK company focused on creating a sustainable circular economy for battery metals, is pleased to announce its results for the six months to 31 December 2022. 

HIGHLIGHTS

Mining

Asturmet Project, Spain

· Results from lithogeochemical sampling at the Aramo mine on the St. Patrick licence confirmed high-grade Copper-Cobalt-Nickel ("Cu-Co-Ni") mineralisation

· St Patrick licence extended for three years to June 2025

Leinster Project, Ireland

· First work programme on Prospecting Licence Area ("PLA 1597") yielded high-grade spodumene pegmatite samples in float ranging up to 3.75% lithium oxide ("Li₂O")

· Secured seven new prospecting licences to its ground holding on its Leinster project, bringing the Company's licence position to 23 licences covering a total of 760km²

· Global Battery Metals Ltd ("GBML"), exercised its first option at the Company's Leinster Property

Recyclus (48.25% owned by TM1)

· Commenced manual recycling operations with first lead acid batteries recycled at Tipton, West Midlands after receiving approved battery treatment operator ("ABTO") status from the Environment Agency

· Received a UN-standard safety certification for its battery transportation and storage boxes

· Appointed Jo Dennis as Group Managing Director, which took effect from 10 October 2022

Corporate

· Technology Minerals signed binding Heads of Terms ("HoTs") to acquire the remaining issued share capital of Recyclus for new shares in the Company

· Entered into a £4.0 million convertible bond facility with Macquarie Bank Limited ("MBL") and Atlas Capital Markets LLC ("ACM"), and drew down £500,000 in the first tranche

· Raised a total of approximately £400,000 gross through the issue of 32,000,000 new ordinary shares to a new institutional shareholder at a subscription price of 1.25 pence per share

Post Period

· On 3 January 2023, Recyclus appointed Nick Pickard as Head of Research and Development

· On 19 January 2023, results from detailed lithogeochemical sampling yielded high-grade lithium pegmatite samples in float ranging up to 3.75% Li₂O at PLA 1597 at Leinster

· In January and February 2023, the Company drew a total of £560,000 before expenses under the convertible bond facility, for a total drawn under the facility of £1,060,000, of which £550,000 has been converted into new ordinary shares

· On 15 February 2023, Recyclus received a Schedule 5 Notice from the Environment Agency for its variation of environmental licence application for its Wolverhampton plant, the final stage before the licence is granted and full operations can commence

· On 20 February 2023, Recyclus was certified as compliant with ISO standards for Quality Management (ISO 9001), Environmental Management (ISO 14001) and Health & Safety Management (ISO 45001).

· On 28 February 2023, five exploration permits at the Technology Minerals Cameroon ("TMC") Property were validated under Cameroon law and granted to the Company

· On 20 March 2023, the Company announced that following favourable test results at Leinster, GBML intends to drill multiple targets across a prospective lithium trend at PLA 1597

· On 23 March 2023, the Company raised £0.8 million from the placement of 80 million ordinary shares at 1p per share, which are subject to a 12-month lock in preventing the sale of the ordinary shares from the date of the agreement, and a further £1.7 million from a two-year convertible loan note convertible into ordinary shares at 3.5p per share

Alex Stanbury, Chief Executive Officer of Technology Minerals, said: "It has been a period of significant progress for Technology Minerals as we have built the foundations to scale up operations in 2023. We continued to advance our exploration projects, receiving particularly encouraging results at our assets in Leinster, Ireland and Asturmet, Spain. Recyclus has now entered the final stages for the required Environment Agency licences to commence full operations at its two UK battery recycling plants. Manual recycling of lead-acid batteries has already commenced at our lead-acid plant at Tipton and, subject to EA approval, the Wolverhampton facility will be the first in the UK to deliver lithium-ion battery recycling on an industrial-scale.

"Our proposed acquisition of Recyclus will crystallise our twin-track strategy to create a fully circular economy for battery metals, combining the extraction of key battery metals alongside the huge demand for battery recycling in the coming years. The importance of establishing new sources of both primary and secondary supply for critical minerals to avert the incoming supply crunch cannot be overstated and Technology Minerals is well positioned to be at the forefront of helping to safeguard the material inputs needed to implement the global transition away from fossil fuels."

Enquiries

Technology Minerals Plc
Robin Brundle, Executive Chairman Alexander Stanbury, Chief Executive Officer	c/o [phone]
Oberon Investments Limited
Nick Lovering, Adam Pollock	[phone]
Arden Partners Plc
Tim Dainton, Louisa Waddell	[phone]
Gracechurch Group
Harry Chathli, Alexis Gore, Rebecca Scott	[phone]

About Technology Minerals Plc

Technology Minerals is developing the UK's first listed, sustainable circular economy for battery metals, using cutting-edge technology to recycle, recover, and re-use battery technologies for a renewable energy future. Technology Minerals is focused on extracting raw materials required for Li-ion batteries, whilst solving the ecological issue of spent Li-ion batteries, by recycling them for re-use by battery manufacturers. With the increasing global demand for battery metals to supply electrification, the group will explore, mine, and recycle metals from spent batteries. Further information on Technology Minerals is available at www.technologyminerals.co.uk    

INTERIM MANAGEMENT REPORT

Overview

The Company made significant progress during the period, with its 48.25% owned Recyclus commencing manual operations at its Tipton site and receiving UN-standard certification for its battery transportation and storage boxes. The Tipton and Wolverhampton plants are now in the final stages of securing the required EA licences to commence full automated operations. On the mining side, the Company continues to raise its portfolio of assets up the value chain through its exploration work and collaboration with partners. During the period, substantial progress was made at the Leinster and Asturmet projects, with encouraging mineral results received at both sites.

During the period, the Company signed binding Heads of Terms with Recyclus to acquire its remaining share capital and fully integrate it within Technology Minerals. The combination of the two businesses will offer a differentiated, IP protected exposure to battery processing, aligning the enlarged business with the energy transition taking place and the circular economy.

Operating Review

Exploration Projects for Battery Metals

The Company continued to make progress with its portfolio of exploration assets, focused on the key metals strategically important for the global transition to electrification. During the period the Company advanced exploration at the Spanish and Irish assets, and also expanded its footprint in Ireland by securing eight new licences at the Leinster project.

The Company's exploration assets by location and resource:

Project	Location	Resource
Asturmet	Spain	Nickel, Copper, Cobalt
Blackbird Creek Property and Emperium	USA	Primary Cobalt
NW Leinster Lithium	Ireland	Lithium
Technology Minerals Cameroon	Cameroon	Nickel Laterite, Cobalt
Oacoma	USA	Manganese, Nickel, Cobalt, Rare Earth Oxides

Asturmet Project, Spain

The Company has extended the St Patrick licence for three years to June 2025 and field operations progressed with a total of 205 rock samples collected and submitted for analysis at the 100% owned historic Aramo Copper-Cu-Co-Ni mine in Asturias. The Company received initial results from a lithogeochemical programme and targeting studies. Grab sampling across multiple mineralised veins and alteration zones confirmed the style and tenor of mineralisation and reported assays ranging up to 1% - 28% copper, 0.1 - 1.88% cobalt and 0.1 - 1.68% nickel. In the coming months, the Company plans to expand its exploration campaign which will help to gain a better understanding the full potential of the project. 

Leinster Project, Republic of Ireland

The Company expanded its footprint at the lithium project in Ireland with eight new licences increasing its foothold in the region to 760km² across 23 licences of highly prospective geology with verified occurrences of spodumene-bearing lithium pegmatites.

The results of the first work programme on new PLA 1597 in County Wexford yielded high-grade spodumene pegmatite samples in float ranging up to 2.95% Li₂O. Post period, in January 2023, the Company announced results from detailed lithogeochemical sampling yielded high-grade spodumene pegmatite samples in float ranging up to 3.75% Li₂O at PLA 1597 in County Carlow.

The Company's partner at the Leinster site, GBML, exercised its first option with respect to the Leinster Property, earning 17.5% equity by spending up to €85,000 in expenditures on the Property. The exercise of the option demonstrated the strength of the working relationship with GBML and underlined their faith in the potential of this project and the Irish pegmatite belt.

Post period, on 20 March 2023, the Company announced that following the return of favourable test results at the Leinster Project, GBML intends to drill multiple targets across a prospective lithium trend at PLA 1597. A detailed deep overburden (base of till) programme was completed for a total of 373 samples covering an area of 600m x 450m over the location of an extensive spodumene pegmatite float boulder train and an associated historically reported trenched bedrock occurrence, with results indicating the potential discovery of up to six LCT (lithium-cesium-tantalum) pegmatite dikes across the Knockeen target area.

TMC Project, Cameroon

Post period, on 28 February 2023, the Company announced that the Cameroon Ministry of Mines, Industry and Technological Development confirmed that the five exploration permits at the TMC Property had been validated under Cameroon law and granted to the Company.

The prospect is located near the world-class Nkamouna nickel-cobalt laterite deposit and covers around 2,500km² in an area considered prospective for nickel and cobalt.  With the approval of the permits finalised, the Company plans to continue further exploration and perform a more detailed remote sensing study of the area for nickel, cobalt and manganese.

Battery Recycling

Tipton and Wolverhampton Recycling Plants

Recyclus has now entered the final stages of securing the required EA licences to become fully operational at its Tipton and Wolverhampton recycling plants.

During the period, Recyclus received Approved Battery Treatment Operator ("ABTO") status from the Environmental Agency for its recycling site in Tipton, West Midlands. The approval allowed Recyclus to commence manual recycling operations at its lead-acid facility. ABTO status authorised Recyclus to produce up to 15,000MT per annum of lead and store up to 300MT of inbound stock at any one time on site. The authorisation marked the beginning of phase one recycling operations at Tipton, which will move to a fully automated recycling process in phase two once receipt of the variation of licence from the Environmental Agency is secured.

Recyclus has commenced processing lead-acid batteries at the Tipton site, with two batches totalling 69 tonnes of batteries manually processed and recycled into lead, lead plate and other recovered materials.

Post period, in February 2023, Recyclus received a Schedule 5 Notice for its variation of environmental licence application for its lithium-ion recycling plant in Wolverhampton, West Midlands, the final stage before the licence is secured. The company has responded to the information requested, and expects the licence determination to be received shortly. The Wolverhampton plant will be the first in the UK with the capacity to recycle lithium-ion batteries on an industrial scale and will be a key foundation of Recyclus' ambition to increase its lithium-ion battery recycling capacity from an estimated 8,300 tonnes in the first full year of operations, to circa 41,500 tonnes by 2027. 

LiBox Battery Boxes

Recyclus was granted a UN-standard safety certification for its industry-leading battery boxes. The battery boxes, under the brand name LiBox, provide a secure solution to the challenges of safely transporting and storing Li-ion batteries, as well as a mechanism for Recyclus' strategy for UK-wide collections of Li-ion batteries and other dangerous goods.

The battery boxes meet rigorous safety standards and have received the ADR certification P911(1), a requirement for transporting hazardous substances by road within Europe. The certification confirms that the boxes adhere to UN standards (UN nos. 3090, 3091, 3480 and 3481) for the transport of damaged or defective cells and batteries liable to rapidly disassemble, dangerously react, produce a flame, a dangerous evolution of heat, or a dangerous emission of toxic, corrosive, or flammable gases or vapours under normal conditions of transport.

Receiving the certification opened new logistical market opportunities for Recyclus in the batteries sector, as it had demonstrated it can safely store and move batteries to UN standards. The battery boxes can be sold both in the UK market and internationally and are also available for short-term leasing options. It also highlights the importance of security and safety in the battery supply chain, especially with potentially hazardous Li-ion batteries.

Leadership Appointments

Recyclus has strengthened its leadership to support the ambitions, growth plans of the company. Jo Dennis was appointed as Group Managing Director, taking effect from 10 October 2022, replacing Matthew Taylor, who has retired. Jo was previously a Non-Executive Director at Recyclus and has extensive experience working across the industrial sector in manufacturing, engineering, distribution, logistics material handling and waste management. Within the waste and recycling space, Jo has successfully driven businesses through the stages of innovation, scale-up, growth and continuous improvement, with a focus on doing so in a sustainable manner while supporting the circular economy.

Post period, Recyclus appointed Nick Pickard as Head of Research and Development, taking effect from 3 January 2023. Nick has more than 30 years' experience designing, manufacturing and servicing recycling machinery. He has worked with some of the largest mining corporate partners across Europe, Australia, South Africa, India and the UK in the design and build of shredding, crushing and size reducing mining systems.

Proposed Acquisition of Recyclus

In October 2022, the Company signed binding HoTs to acquire the remaining issued share capital of Recyclus for new shares in the Company. Subject to completion of the acquisition, Recyclus will be a 100%-owned subsidiary of Technology Minerals. The acquisition will strengthen Technology Minerals' balance sheet and provide early cashflow from recycling operations controlled by the Company. The Company will update shareholders as to progress made in relation to the Proposed Transaction as and when appropriate.

Research and development, and certifications

Recyclus believes it is well positioned to make continued progress on research and development, having submitted joint grant bids with potential academic partners to widen the scope of its lithium-ion battery recycling technology.  It has also applied for a patent for its process for the sulphurisation of lead paste. The development of new intellectual property will aid the company in creating new sources of revenue and maintain its technological edge in the marketplace.

Post period, in February 2023, Recyclus was certified as compliant with ISO standards for Quality Management (ISO 9001), Environmental Management (ISO 14001) and Health & Safety Management (ISO 45001).

Financial Review

The Group made a loss for the period of £685k (2021: loss £1,072k) and raised £806k from the issue of new shares and borrowings. The Group capitalises exploration and development costs as intangible assets. In December 2022 the Company entered into a £4m convertible loan facility of which at the date of this report £1.1m has been drawn of which £0.55m has been converted into ordinary shares. In March 2023, the Company raised £2.5 million before expenses from the issue of £0.8 million in new ordinary shares, which are subject to a 12-month lock in preventing the sale of the ordinary shares from the date of the agreement, and £1.7 million from a convertible loan note. 

Risks

The Company was incorporated recently, in 2021 and lacks a significant operating history, and therefore, investors have little basis on which to evaluate the Company's ability to achieve its objective of identifying, acquiring and operating one or more companies, businesses, prospects or assets.

In the opinion of the Directors, based on the Group's financial projections, they have satisfied themselves that the business is a going concern. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and therefore the accounts are prepared on a going concern basis.

The Directors do not consider that the Company's principal risks and uncertainties have changed since the publication of its annual report and accounts for the 12-month period ended 30 June 2022 on 31 October 2022, which contains a detailed explanation of the risks relevant to the Company and is available at: https://www.technologyminerals.co.uk/investors-section/documents-results-and-reports .

Outlook

Technology Minerals has made significant progress over the last six months, positioning the Company for a transformational year in 2023. The Company continued to advance its exploration assets, particularly in Ireland and Spain. The aim remains to increase the value of each project through efficient, targeted exploration work in a capital-light manner, seek out partnerships to inject further capital as required, and creating additional value in the portfolio and for shareholders.

Recyclus successfully commenced manual processing operations at Tipton and has entered the final stages for the full EA licence for Tipton and Wolverhampton to commence fully automated operations. The Wolverhampton plant will be the first in the UK with the capacity to recycle lithium-ion batteries on an industrial scale. In addition, Recyclus leased its first LiBatt transportation and storage battery boxes after securing the UN standard safety certification, adding a further revenue stream to the business. There is strong interest in both the recycling plants and battery boxes, and discussions are continuing with companies and organisations from the UK and internationally regarding potential agreements and partnerships.

The proposed acquisition of Recyclus marks the next stage of Technology Minerals' development and will consolidate both the mining and battery recycling businesses in line with our twin-track strategy to create a sustainable circular economy for battery metals, using cutting-edge technology to recycle, recover, and re-use battery technologies for a renewable energy future. Recyclus plans to open multiple Li-ion and lead-acid battery recycling plants over the coming years, with the first two expected to be fully operational in the UK once final EA approval comes through. Through the expansion of Recyclus' commercial footprint in the UK, and internationally, the Company will be well positioned to play a leading role as the world transitions to electrification.

Responsibility Statement

The Directors confirm that to the best of their knowledge:

(a) the condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting';

(b) the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year; and

(c) the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

Mr Alexander Stanbury

Chief Executive Officer

28 March 2023

Condensed Consolidated Statement of Comprehensive Income

for the six-months ended 31 December 2022

	Notes	6 months to 31 December 2022 Unaudited	6 months to 31 December 2021 Unaudited	Period ended 30 June 2022 Audited
Continuing operations		£000s	£000s	£000s
IPO costs		-	(314)	(146)
Administrative expenses		(786)	(757)	(1,734)
Operating loss		(786)	(1,071)	(1,880)
Other income		52	-	49
Net finance charges		42	-	46
Loss before taxation		(692)	(1,071)	(1,785)
Income tax		-	-	-
Loss for the period		(692)	(1,071)	(1,785)
Attributable to:
Equity holders of the Company		(689)	(1,071)	(1,782)
Non-controlling interests		(3)	-	(3)
		(692)	(1,071)	(1,785)
Other comprehensive income
Items that may be subsequently reclassified to profit or loss:
Exchange gains arising on translation of foreign operations		7	(1)	30
Total comprehensive income for the period		(685)	(1,072)	(1,755)
Attributable to:
Equity holders of the Company		(682)	(1,072)	(1,752)
Non-controlling interests		(3)	-	(3)
Total comprehensive income for the period		(685)	(1,072)	(1,755)
Earnings per share:
Basic and diluted earnings per share (pence)	6	(0.05)p	(0.33)p	(0.23)p

 

Condensed Consolidated Statement of Financial Position

As at 31 December 2022

	Notes	31 December 2022 Unaudited	31 December 2021 Unaudited	30 June 2022 Audited
		£000s	£000s	£000s
Non-current assets
Property, plant and equipment		4	5	5
Intangible assets	7	18,620	18,686	18,300
Financial assets		1,221	1,221	1,221
Loans to associates	8	4,764	3,294	4,538
Total non-current assets		24,609	23,206	24,064
Current assets
Trade and other receivables		182	295	67
Cash and cash equivalents		85	756	371
Current assets		267	1,051	438
Total assets		24,876	24,257	24,502
Current liabilities
Trade and other payables	9	(762)	(577)	(602)
Borrowings		-	(83)	(21)
Total current liabilities		(762)	(660)	(623)
Non-current liabilities
Derivative financial liability	12	(65)	-	-
Borrowings	12	(435)	-	-
Deferred tax liability	13	(2,891)	(2,778)	(2,891)
Total non-current liabilities		(3,391)	(2,778)	(2,891)
Total liabilities		(4,153)	(3,438)	(3,514)
Net assets		20,723	20,819	20,988
Equity attributable to owners of the parent
Share Capital	10	1,304	1,213	1,271
Share Premium	10	20,125	19,409	19,770
Warrants reserve		1,457	1,656	1,420
Foreign exchange reserve		36	(1)	30
Accumulated deficit		(2,222)	(1,458)	(1,529)
Equity attributable to owners of the parent		20,700	20,819	20,962
Non-controlling interests		23	-	26
Total equity		20,723	20,819	20,988

Condensed Consolidated Statement of Changes in Equity

for the six-month period ended 31 December 2022

	Share capital	Share Premium	Warrants   reserve	Foreign exchange reserve	Accumulated deficit	Equity	Non-controlling interests	Total Equity
	£000	£000	£000	£000	£000	£000	£000	£000
Balance at 30 June 2021	50	-	-	-	(387)	(337)	-	(337)
Loss for the period	-	-	-	-	(1,071)	(1,071)	-	(1,071)
Exchange loss on translation of foreign operations	-	-	-	(1)	-	(1)	-	(1)
Total comprehensive income for the period	-	-	-	(1)	(1,071)	(1,072)	-	(1,072)
Transactions with owners:
Issue of share capital	1,163	21,339	-	-	-	22,502	-	22,502
Share issue costs	-	(274)	-	-	-	(274)	-	(274)
Warrants issued	-	(1,656)	1,656	-	-	-	-	-
Balance at 31 December 2021	1,213	19,409	1,656	(1)	(1,458)	20,819	-	20,819
Loss for the period	-	-	-	-	(324)	(324)	(3)	(321)
Exchange gain on translation of foreign operations	-	-	-	31	(3)	27	3	30
Total comprehensive income for the period	-	-	-	31	(327)	(296)	-	(296)
Issue of share capital	58	1,399	-	-	-	1,457	-	1,457
Share issue costs	-	(1,038)	-	-	-	(1,038)	-	(1,038)
Warrants exercised	-	-	(236)	-	236	-	-	-
Part disposal of subsidiary	-	-	-	-	20	20	26	46
Balance at 30 June 2022	1,271	19,770	1,420	30	(1,529)	20,962	26	20,988
Loss for the period	-	-	-	-	(689)	(689)	(3)	(692)
Exchange gain/(loss) on translation of foreign operations	-	-	-	6	(4)	2	-	2
Total comprehensive lo income for the period	-	-	-	6	(693)	(687)	(3)	(690)
Transactions with owners:
Issue of share capital	33	388	-	-	-	421	-	421
Share issue costs	-	(33)	-	-	-	(33)	-	(33)
Warrants issued	-	-	37	-	-	37	-	37
Balance at 31 December 2022	1,304	20,125	1,457	36	(2,222)	20,700	23	20,723

Condensed Consolidated Statement of Cash Flows

for the six-month period ended 31 December 2022

	6 months to 31 December 2022 Unaudited	6 months to 31 December 2021 Unaudited	Period ended 30 June 2022 Audited
	£000's	£000's	£000's
Cash flows from operating activities
Loss before taxation	(692)	(1,071)	(1,785)
Adjustments for:
Depreciation	1	-	3
Interest received	(44)	-	-
Interest paid	2	-	-
Unrealised foreign exchange movements	2	-	(4)
Net cashflow before changes in working capital	(731)	(1,071)	(1,786)
Movement in receivables	(68)	(235)	(21)
Movement in payables	179	181	423
Net cash used in operating activities	(620)	(1,125)	(1,384)
Cash flows from investing activities
Purchase of intangible assets	-	(217)	-
Purchase of property, plant and equipment	-	(5)	(4)
Exploration expenditure	(321)	-	(892)
Loans to associates	(151)	(2,107)	(4,538)
Acquisition of subsidiaries net of cash	-	6	26
Proceeds from sale of investment in subsidiary	-	-	860
Net cash used in investing activities	(472)	(2,323)	(4,538)
Cash flows from financing activities
Issue of share capital	400	1,500	1,550
Cost of issue of shares	(33)	(190)	(430)
Proceeds of borrowing	460	2,894	5,193
Repayment of borrowing	(21)	-	-
Proceeds from exercise of warrants	-	-	788
Cost of procuring convertible loan notes	-	-	(798)
Net cash generated from financing activities	806	4,204	6,303
Net increase in cash and cash equivalents during the period	(286)	756	371
Cash at the beginning of period	371	-	-
Cash and cash equivalents at the end of the period	85	756	371

 

Notes to the condensed consolidated interim financial information

1.  GENERAL INFORMATION

The Company is incorporated and domiciled in England and the registered number of the Company is 13446965. The registered office is 18 Savile Row, London, W1S 3PW.

2.  BASIS OF PREPARATION

The accounting policies, methods of computation and presentation used in the preparation of the condensed consolidated interim financial information are shown below

There have been no changes to the reported figures as a result of any new reporting standards or interpretations.

Basis of preparation

The condensed interim financial statements ("Interim Financial Statements") have been prepared in accordance with the requirements of IAS 34 "Interim Financial Reporting". The Interim Financial Statements should be read in conjunction with the audited consolidated financial statements of the Group for the year ended 30 June 2022, which have been prepared in accordance with International Financial Reporting Standards (IFRS) in conformity with the Companies Act 2006 and are available on the https://www.technologyminerals.co.uk/

The financial information set out in this interim report is unaudited and does not constitute statutory accounts as defined in section 434 of the Companies Act 2006.

Comparatives

The comparatives are for the unaudited 6-month period ended 31 December 2021 and for the audited period from 9 June 2021 to 30 June 2022. The business is not subject to seasonal variations. The report of the auditors on these accounts was unqualified.

Going Concern

In the period, the Company raised £0.9m (before expenses) to finance the working capital requirements of the Group, of which £0.5m was in respect of a £4.0m convertible loan facility. Since the period end the Company has drawn a further £0.6m under this facility £0.8 million from the placement of 80 million ordinary shares and a further £1.7 million f rom a convertible loan note. In the opinion of the Directors, based on the Group's financial projections, they have satisfied themselves that the business is a going concern. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and therefore the accounts are prepared on a going concern basis.

3.  SIGNIFICANT ACCOUNTING POLICIES

The Interim Financial Statements have been prepared in accordance with the accounting policies adopted in the Group's most recent annual financial statements for the year ended 30 June 2022.

4.  CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The preparation of the Interim Financial Statements require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the end of the reporting period. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.

The judgements, estimates and assumptions applied in the Interim Financial Statements, including the key sources of estimation uncertainty, were the same as those applied in the Group's last annual financial statements for the year ended 30 June 2022. The only exception is the treatment of the convertible loan notes ('CLNs') issued during the period, which have been treated as a financial liability with a related embedded derivative liability.

Initial recognition of the embedded derivative was calculated as the difference between the present value of the future cash flows of CLNs issued and the present value of future cash flows of an equivalent debt facility without conversion shares. The annual interest rate of the debt facility without conversion shares was estimated at 15%.

The host debt contract (financial liability) is recognised as the difference between the fair value of the CLNs drawn down and derivative financial liability.  

5.  BUSINESS AND GEOGRAPHICAL REPORTING

The Group's chief operating decision maker is considered to be the executive directors (the 'Executive Board').  The Executive Board evaluates the financial performance of the Group by reference to its mineral exploration, battery recycling activities and Holding company expenses - its reportable segments.

Below is a summary of the Group's results, assets and liabilities by reportable segment as presented to the Executive Board.

	Mineral exploration	Battery recycling	Holding Company	Total
	£000's	£000's	£000s	£000's
6 months to 31 December 2022 - Unaudited
Operating expenses	(129)	-	(564)	(693)
Total segment operating loss	(129)	-	(564)	(693)
6 months to 31 December 2021 - Unaudited
Operating expenses	(94)	-	(663)	(757)
Total segment operating loss	(94)	-	(663)	(757)
Year ended 30 June 2022 - Audited
Operating expenses	(130)	-	(1,655)	(1,785)
Total segment operating loss	(130)	-	(1,655)	(1,785)
Total segment assets
At 31 December 2022 - Unaudited	18,894	4,764	1,218	24,876
At 31 December 2021 - Unaudited	16,105	3,294	2,080	21,479
At 30 June 2022 - Audited	18,572	4,538	1,392	24,502
Total segment liabilities
At 31 December 2022	(2,982)	-	(1,671)	(4,653)
At 31 December 2021	(281)	-	(379)	(660)
At 30 June 2022	(3,002)	-	(512)	(3,514)

6.  LOSS PER SHARE

Basic earnings per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. Warrants issued by the Company that could potentially dilute basic EPS in the future have not been included the calculation of diluted EPS because they are antidilutive for the period(s) presented. See note 12 for further information on the warrants.

	Unaudited 6 months to 31 December 2022	Unaudited 6 months to 31 December 2021	Audited Period ended 30 June 2022
	£000's	£000's	£000's
Loss from continuing operations attributable to equity holders of the company	(692)	(1,071)	(1,785)
Weighted average number of ordinary shares in issue	1,280,777,941	327,989,689	785,135,966
Basic and fully diluted loss per share from continuing operations in pence	(0.05)p	(0.33p)	(0.23p)

7.  INTANGIBLE ASSETS

 

UNAUDITED

Cost	Mineral exploration £000s	Goodwill £000s	Total £000s
At 1 July 2022	15,409	2,891	18,300
Exploration expenditure	320	-	320
At 31 December 2022	15,729	2,891	18,620
Accumulated amortisation
At 1 July 2022	-	-	-
Amortisation	-	-	-
At 31 December 2022	-	-	-
Net book value at 31 December 2022	15,729	2,891	18,620

Unaudited

Cost	Mineral exploration £000s	Goodwill £000s	Total £000s
At 1 July 2021	-	-	-
Acquired through business combinations	15,691	2,778	18,469
Exploration expenditure	217	-	217
At 31 December 2021	15,908	2,778	18,686
Accumulated amortisation
As at incorporation 9 June 2021 and 30 June 2021	-	-	-
Amortisation	-	-	-
At 31 December 2021	-	-	-
Net book value at 30 June 2021	-	-	-
Net book value at 31 December 2021	15,908	2,778	18,686

AUDITED

Cost	Mineral exploration £000	Goodwill £000	Total £000
9 June 2021	-	-	-
Acquired through business combinations	14,477	2,891	17,368
Additions	1,746	-	1,746
Disposals	(814)	-	(814)
30 June 2022	15,409	2,891	18,300
Accumulated amortisation
9 June 2021	-	-	-
Amortisation	-	-	-
30 June 2022	-	-	-
Net book value 30 June 2022	15,409	2,891	18,300

8.  LOANS TO ASSOCIATES

During the period the Company provided a loan to Recyclus as follows:

			£000s
At 9 June 2021			-
Loans acquired / additions			3,294
At 31 December 2021 - Unaudited			3,294
Additions			1,244
At 30 June 2022 - Audited			4,538
Additions			226
At 31 December 2022 - Unaudited			4,764

Loans to associates generally bear 2% interest. The loan is repayable in monthly instalments from July 2022.

9.  TRADE AND OTHER PAYABLES

	Unaudited 31 December 2022 £000s	Unaudited 31 December 2021 £000s	Audited 30 June 2022 £000s
Trade and other payables	610	428	449
Taxation and social security	133	55	71
Accruals	18	94	82
At 31 December 2021	762	577	602

10.  SHARE CAPITAL AND SHARE PREMIUM

Group and Company	Number of ordinary shares of 1p	Share capital £000s	Share premium £000s
At 9 June 2021	50,000,000	50	-
Share issue - placings	66,666,667	66	1,433
Share issue - deal consideration	807,252,571	807	15,391
Share issue - conversion of CLNs	306,229,366	306	4,887
Share issue - introduction fees	3,733,333	4	80
Share issue - costs	-	-	(274)
Fair value of share warrants issued	-	-	(1,656)
At 31 December 2021	1,212,868,497	1,213	19,409
Share issue - warrants exercised	29,813,941	30	758
Share issue - in lieu of services provided	7,727,715	8	189
Share issue - costs	-	-	(1,038)
At 30 June 2022	1,271,423,593	1,271	19,770
Share issue - placings	32,000,000	32	368
Share issue - in lieu of services provided	1,100,000	1	20
Share issue - costs	-	-	(33)
At 31 December 2022	1,304,523,593	1,304	20,125

The history of the Company's share capital issued during the period ended 31 December 2022 is as follows:

Share placing - 2 November 2022

Placing of 32,000,000 Ordinary Shares of £0.001 at a price of £0.0125 per Ordinary Share, to an institutional investor raising £400,000 before issue costs.

Shares issued in lieu of services provided - 2 November 2022

1,100,000 Ordinary Shares of £0.001 at a price of £0.0189 per Ordinary Share were issued in settlement of £20,790 due a supplier.

11.  WARRANTS

On 9 December 2022 the Company entered into a £4.0m convertible bond facility (the "Facility") with Macquarie Bank Limited ("MBL") and Atlas Capital Markets LLC ("ACM") See note 13. The Facility will be drawn down in tranches. Warrants amounting to 30% of each tranche will be attached to each tranche of the convertible bonds. The warrants will have a strike price fixed at 30% premium to the Volume Weighted Average Price of the Shares for the 5 consecutive days prior to the issue date of each tranche. The warrants will expire two years after issuance.

On 16 December 2022 the Company drew down a £500,000 tranche ("CLN Tranche 1") from the Facility. 6,921,527 warrants were issued to the holders of the CLN Tranche 1.

The fair value of the warrants issued during the period was calculated using the Black-Scholes mode using the following information:

			CLN Tranche 1
Number of shares that could be acquired on the exercise of the warrant			6,921,527
Fair value of one CLN Warrant			£0.0053
Warrant Share exercise price			£0.021672
Date of grant
Time to maturity, years			2
Share price			£0.015250
Expected volatility*,%			78%
Expected dividend growth rate,%			0%
Risk-free interest rate (3 month bond),%			5%

*Calculation of volatility involves significant judgement by the Directors due to the absence of the historical trading data for the Company at the date of the grant.

The fair value of the CLN Tranche 1 warrants is £36,601 and has been treated as a finance cost amortised over warrant term.

The total number of warrants outstanding at 31 December 2022 was 363,625,840 (31 December 2021 - 386,518,254; 30 June 2022 - 356,704,313)

12.  CONVERTIBLE LOAN NOTES

On 9 December 2022 the Company entered into a £4.0 million convertible bond facility (the "Facility") with Macquarie Bank Limited ("MBL") and Atlas Capital Markets LLC ("ACM").

On 16 December 2022 the Company drew down a £500,000 tranche ("CLN Tranche 1"). The net proceeds were £460,000. 

CLN Tranche	Amount borrowed £000s	Discount to par value %	Debt at amortised cost £000s	Derivative financial liability £000s
Tranche 1	500	5%	435	65
Total	500		435	65

The Facility is treated as a financial liability with a related embedded derivative liability. The host debt contract will be measured at amortised cost, whilst the embedded derivative liability at fair value through profit and loss.

Under the Facility, MBL and ACM will provide a £4.0 million convertible bond facility with a coupon of 5% per annum over the SONIA rate, payable quarterly in cash or in shares at the Company's discretion. The Facility can be drawn in eight tranches of up to £500,000 with each tranche being called at Technology Mineral's discretion once the previous tranche has been fully converted and subject to certain conditions. MBL and ACM will purchase the convertible bonds at a fixed price equal to 95% of the principal amount. MBL will purchase the first tranche, and each subsequent tranche will be purchased by MBL or ACM pursuant to the terms of the subscription agreement among the parties.

MBL and ACM can convert the convertible bonds to Technology Minerals shares ("Shares") by issuing a conversion notice with the price set at 90% of the 3-day Volume Weighted Average Price of the Shares, where the 3 days may be consecutive or not and are selected by MBL or ACM (as applicable) from the 20 days prior to the issue of a conversion notice by MBL or ACM. The convertible bonds shall have a maturity of two years from issuance.

The Company will pay a transaction fee equal to 3% of each tranche (the "Commission"). The Commission is payable in cash and may be deducted from the amount payable by MBL or ACM (as applicable) to Technology Minerals for each tranche.

In addition, warrants amounting to 30% of each tranche will be attached to each tranche of the convertible bonds. The warrants will have a strike price fixed at 30% premium to the Volume Weighted Average Price of the Shares for the 5 consecutive days prior to the issue date of each tranche. The warrants will expire two years after issuance.

The convertible bonds would be capable of redemption at any time by the Company with 60 business days' notice at par plus 10% premium of the principal amount remaining.

13.  DEFERRED TAX LIABILITY

Deferred tax is calculated in full on temporary differences under the liability method.

		£000s
At 9 June 2021		-
Arising on acquisition of mineral resource projects		2,778
At 31 December 2021 - Unaudited		2,778
Arising on acquisition of mineral resource projects		113
At 30 June 2022 - Audited		2,891
At 31 December 2022 - Unaudited		2,891

14.  EVENTS OCCURRING AFTER THE REPORTING DATE

On 30 January 2023, the Company drew CLN Tranche 2 in the amount of £250,000 under the Facility as described in Note 12, and on 24 February 2023 a further CLN Tranche 3 in the amount of £310,000. Warrants attaching to these tranches over Ordinary Shares are 4,298,980 with an exercise price of 1.342p and 5,494,471 with an exercise price of 1.30202p per share respectively.

At the date of this report a total of £550,000 had been converted into 55,380,161Ordinary Shares.

On 23 March 2023, the Company raised £0.8 million from the placement of 80 million ordinary shares at 1p per share, which are subject to a 12-month lock in preventing the sale of the ordinary shares from the date of the agreement, and a further £1.7 million from a two-year convertible loan note convertible into ordinary shares at 3.5p per share.

 

END

 

 

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