Interim Results

RNS Number : 2567C
Premier African Minerals Limited
28 September 2018
 

 

For immediate release

28 September 2018

 

Premier African Minerals Limited
('Premier' or 'the Company')

 

Unaudited Interim Results for the six months ended 30 June 2018

 

Premier African Minerals Limited, the AIM quoted multi-commodity mining and resource development Company focused on Southern Africa announces its unaudited interim results for the six months ended 30 June 2018.

 

CEO'S STATEMENT

 

The first six months of 2018 (the "Period") was extensively reported as post financial year end events in our annual financial statements and various announcements released via the Regulatory News Service (as summarised further in Note 11 below) and this statement  is complementary. We are encouraged with recent events in Zimbabwe and assurances that resolution to the equity issue at RHA Tungsten Mine ("RHA") should be expected. The initial potential investment agreement to continue developments at Zulu Lithium and Tantalum Project ("Zulu Lithium Project") was encouraging but, in the failure to progress to a final agreement, disappointing. But we remain confident on the prospects at Zulu Lithium Project and expect to conclude an alternative strategy for its development. Drilling at the open pit and the underground at RHA has commenced and there is more commentary on this below.

 

The financial drain on the Company over the past 6 months has been substantial and the costs associated with holding RHA on care and maintenance as well as the uncertainties associated with timing of the Zimbabwean Government's decision has made it very difficult to both hold the Company ready for a quick restart at RHA and cut costs as the situation may indicate. Suffice it to say that the status at RHA must now come to a head. Premier continues to reduce overheads and is pleased to report that executive management have agreed in principle to accept not less than 50% of their already reduced remuneration in the form of equity in Premier and a further announcement will be made in respect of these proposed arrangements. The Board continues to review third party financing for our projects.

 

Zulu Lithium Project

 

As reported on 17 September 2018 following the Period end, the Company was unable to reach final terms with Cadence Minerals plc to fully fund the Definitive Feasibility Study for Zulu Lithium Project. Other interested parties have engaged with Premier and indications are that the prospects of concluding a new joint venture agreement to progress Zulu Lithium Project and RHA Tungsten Mine in one agreement are good. It is a time of intense negotiation and further updates will be provided.

 

RHA Tungsten Mine

 

In the leadup to resolution of the equity status, Premier has recently commenced further drilling with the dual purpose of establishing conclusively whether or not the open pit should be reopened and to guide the decision in regard to the underground mining future development. The decision the Company needs to take in regard to underground mining is whether to deepen the main shaft or to establish a new decline shaft system. Deepening the vertical shaft is the cheaper option but will limit the mining rate and would likely not see RHA at a mining rate any greater than 10,000 tons per month even after upgrade of the hoist system. The alternative decline, whilst longer term to construct, will allow a much higher mining rate and overall better prospects for higher profit over life of mine. Early indications from deep drilling of mineralisation approximately 70 meters below existing underground workings have returned encouraging intersections of the ore body lode system with massive visible mineralisation. Assay results are expected and will be announced as they become available.

 

At the same time, careful assessment for a profitable start-up have been undertaken and indications are that historic tailings should be processed simultaneously with ore from underground to restrict peak funding and speed up this process will be covered in a subsequent RNS.

 

Other Zimbabwe Projects

 

Premier maintains claims to a number of other prospective projects in Zimbabwe. These include Tinde Fluorspar, Globe multi-element and graphite and Rare Earth Elements at Katete. Whilst RHA and Zulu Lithium Project are taking centre stage in this period under review, these other projects remain potentially attractive.

 

Board and Management Changes

 

With effect from 20 July 2018, the Company announced that Mr. Michael Foster had been appointed as Interim Non-Executive Chairman of the Company. Mr. George Roach has remained as CEO of Premier. 

Prior to the AGM and with effect from 9 August 2018, Mr. Russel Swarts did not offer himself for re-appointment as a director of the Company.

 

Funding

 

During the six months ended 30 June 2018 the Company raised some $0.563 million through equity subscriptions, at an issue price of 0.16 pence per new ordinary share, the net proceeds were used to cancel all the existing warrants held by Darwin Capital Limited ("Darwin") and for general working capital purposes.

 

As announced on 4 June 2018, the Company entered into a loan with a company owned by a Trust of which Mr. George Roach is a beneficiary, for a gross value of $0.300 million. The Loan is non-interest bearing and has a maturity date of 30 November 2018, and will provide additional general working capital while the Company looks to bring finality to the negotiations currently underway in respect of both Zulu Lithium Private Limited and RHA Tungsten Private Limited.  Further details of the loan agreement and terms thereof are contained in the RNS of same date.

 

Outlook

 

Prospects for RHA have improved considerably with the recent improvement in Tungsten pricing and provided there is resolution to the equity ownership of RHA and the limited additional capital to deal with final underground development and plant modifications is available, operations can re-commence.

 

We expect developments from Circum Minerals Limited and remain confident that this investment will be profitable for shareholders.

 

The Zulu Lithium Project has potential to develop into a company making asset and we look forward to exploration results as they become available in the near future.

 

I would like to take this opportunity to thank our shareholders, directors, advisors and consultants for their continued support, commitment and confidence in Premier.

 

Mr. George Roach
CEO
27 September 2018

 

 

Forward Looking Statements

 

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as "believe", "could", "should", "envisage", "estimate", "intend", "may", "plan", "will" or the negative of those, variations or comparable expressions, including references to assumptions. These forward looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation No. 596/2014 on market abuse. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain. The person who arranged the release of this announcement on behalf of the Company was George Roach.

 

For further information please visit www.premierafricanminerals.com or contact the following:

 

Fuad Sillem

Premier African Minerals Limited

Tel: +44 (0)7734 922074

Michael Cornish / Roland Cornish

Beaumont Cornish Limited (Nominated Advisor)

Tel: +44 (0)20 7628 3396

Jerry Keen / Edward Mansfield

Shore Capital Stockbrokers Limited

Tel: +44 (0)20 7408 4090

 

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

EXPRESSED IN US DOLLARS

 

 

 

Six months to 30 June 2018

Six months to 30 June 2017

Year to 31 December 2017

 

$ 000

$ 000

$ 000

 

(Unaudited)

(Unaudited)

(Audited Restated)

ASSETS

 

 

 

Non-current assets

 

 

 

Intangible assets

4 426

6 570

4 291

Goodwill

-

1 034

-

Investments

6 603

3 300

6 459

Property, plant and equipment

-

10 454

-

Trade and other receivables

-

-

-

 

11 029

21 358

10 750

Current assets

 

 

 

Inventories

-

512

-

Trade and other receivables

208

609

239

Cash and cash equivalents

91

190

316

 

299

1 311

555

TOTAL ASSETS

11 328

22 669

11 305

 

 

 

 

LIABILITIES

 

 

 

Non-current liabilities

 

 

 

Other financial liabilities

(70)

(939)

(97)

Deferred tax

0

(983)

-

Provisions - rehabilitation

(994)

(849)

(917)

 

(1 064)

(2 771)

(1 014)

Current liabilities

 

 

 

Bank overdraft

(302)

(51)

(182)

Trade and other payables

(2 480)

(3 071)

(1 942)

Other financial liabilities

(56)

(1 370)

(58)

Borrowings

(534)

(312)

(216)

 

(3 372)

(4 804)

(2 398)

TOTAL LIABILITIES

(4 436)

(7 574)

(3 412)

 

 

 

 

NET ASSETS

6 892

15 095

7 893

 

 

 

 

EQUITY

 

 

 

Share capital

44 665

33 130

44 158

Share based payment and warrant reserve

2 223

2 212

2 393

Revaluation reserve

854

(176)

711

Retained earnings

(28 689)

(16 014)

(27 614)

Total equity attributed to the owners of the parent company

19 053

19 152

19 648

Non-controlling interest

(12 161)

(4 057)

(11 755)

 

 

 

 

TOTAL EQUITY

6 892

15 095

7 893

 

 

 

 

 

 

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

EXPRESSED IN US DOLLARS

 

 

 

Six months to 30 June 2018

Six months to 30 June 2017

Year to 31 December 2017

Continuing operations

(Unaudited)

(Unaudited)

(Audited Restated)

 

$ 000

$ 000

$ 000

 

 

 

 

Revenue

166

293

368

Cost of sales excluding depreciation and amortisation expense

(262)

(1 155)

(3 500)

Depreciation and amortisation

-

(912)

(1 471)

Gross loss

(96)

(1 774)

(4 603)

Administrative expenses

(1 299)

(1 515)

(3 602)

Operating loss

(1 394)

(3 289)

(8 205)

 

 

 

 

Fair value movement on available-for-sale investment

-

(1 000)

(104)

Impairment of RHA

-

-

(9 809)

Finance costs

(87)

(206)

(1 507)

 

(87)

(1 206)

(11 420)

Loss before income tax

(1 481)

(4 495)

(19 625)

Income tax expense

-

-

-

Loss from continuing operations

(1 481)

(4 495)

(19 625)

 

 

 

 

Discontinued operation

 

 

 

Loss from discontinued operation net of tax

-

-

(136)

 

 

 

 

Loss for the year

(1 481)

(4 495)

(19 761)

Other comprehensive income:

 

 

 

Items that are or may be reclassified subsequently to profit or loss:

 

 

 

Foreign exchange translation

-

18

-

Fair value movement on available-for-sale investment

143

-

(1 889)

 

143

18

(1 889)

Total comprehensive income for the period

(1 338)

(4 478)

(21 650)

 

 

 

 

Loss attributable to:

 

 

 

Owners of the Company

(1 075)

(3 154)

(12 657)

Non-controlling interests

(406)

(1 341)

(7 104)

 

(1 481)

(4 495)

(19 761)

 

 

 

 

Total comprehensive income attributable to:

 

 

 

Owners of the Company

(932)

(3 137)

(14 546)

Non-controlling interests

(406)

(1 341)

(7 104)

 

 

 

 

Total comprehensive income for the period

(1 338)

(4 478)

(21 650)

 

 

 

 

Loss per share attributable to owners of the parent (expressed in US cents)

 

 

Basic loss per share

0

(0.1)

(0.3)

Diluted loss per share

0

(0.1)

(0.3)

 

 

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

EXPRESSED IN US DOLLARS

 

Share capital

Foreign currency translation reserve

Share option and warrant reserve

Revaluation reserve

Retained earnings

Total attributable to owners of parent

Non-controlling interest("NCI")

Total equity

 

 

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

 

At 1 January 2017 restated

27 633

-

1 846

2 600

(14 957)

17 122

(3 716)

13 406

 

Loss for the period

-

-

-

-

(2 177)

(2 177)

(1 117)

(3 294)

 

Foreign exchange translation

-

50

-

-

-

50

-

50

 

Total comprehensive income for the period

-

50

-

-

(2 177)

(2 127)

(1 117)

(3 244)

 

Transactions with Owners

 

 

 

 

 

 

 

 

 

Issue of equity shares

5 104

-

-

-

-

5 104

-

5 104

 

Share issue costs

(242)

-

-

-

-

(242)

-

(242)

 

Share based payments

-

-

46

-

-

46

-

46

 

At 30 June 2017 restated

32 495

50

1 892

2 600

(17 134)

19 903

(4 833)

15 070

 

Loss for the period

-

-

-

-

(10 480)

(10 480)

(5 987)

(16 467)

 

Foreign exchange translation

-

(50)

-

-

-

(50)

-

(50)

 

Other comprehensive income for the period

-

-

-

(1 889)

-

(1 889)

-

(1 889)

 

Total comprehensive income for the period

-

-

-

(1 889)

(10 480)

(12 419)

(5 987)

(18 406)

 

Transactions with Owners

 

 

 

 

 

 

 

 

 

Disposal of TCT IF

-

-

-

-

-

-

(935)

(935)

 

Issue of equity shares

12 399

-

-

-

-

12 399

-

12 399

 

Share issue costs

(736)

-

-

-

-

(736)

-

(736)

 

Share based payments

-

-

358

-

-

358

-

358

 

Loan note warrants

-

-

143

-

-

143

-

143

 

At 31 December 2017

44 158

-

2 393

711

(27 614)

19 648

(11 755)

7 893

 

Loss for the period

-

-

-

-

(1 075)

(1 075)

(406)

(1 481)

 

Other comprehensive income for the period

-

-

-

143

-

143

-

143

 

Total comprehensive income for the period

-

-

-

143

(1 075)

(932)

(406)

(1 338)

 

Transactions with Owners

 

 

 

 

 

 

 

 

 

Issue of equity shares

564

-

-

-

-

564

-

564

 

Share issue costs

(56)

-

-

-

-

(56)

-

(56)

 

Share based payments

-

-

(170)

-

-

(170)

-

(170)

 

At 30 June 2018

44 666

-

2 223

854

(28 689)

19 054

(12 161)

6 893

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

EXPRESSED IN US DOLLARS

 

 

 

 

 

Six months to 30 June 2018

Six months to 30 June 2017

Year to 31 December 2017

 

 

$ 000

$ 000

$ 000

 

(Unaudited)

(Unaudited)

(Audited)

 

 

 

 

Net cash outflow from operating activities

(775)

(2 243)

(6 215)

 

 

 

 

Investing activities

 

 

 

 

 

 

 

Property plant and equipment expenditure

-

(1 704)

(1 592)

Acquisition of intangible assets

(135)

(180)

(704)

Disposal of discontinued operation, net of cash disposed of

 

-

-

(84)

Acquisition of investment

-

(50)

(2 986)

 

 

 

 

Net cash (used)/from in investing activities

(135)

(1 934)

(5 366)

 

 

 

 

Financing activities

 

 

 

Net proceeds from issue of loan notes

-

523

523

Net proceeds from issue of share capital

507

4 011

11 101

Share issue costs

-

(340)

-

Warrants redeemed

(204)

-

-

Finance charges

(1)

(30)

(18)

Repayment of Finance lease

(36)

(37)

(71)

Borrowings repaid

300

(58)

(65)

 

 

 

 

Net cash from financing activities

566

4 069

11 470

 

 

 

 

Net (decrease)/increase in cash and cash equivalents

(344)

(108)

(111)

 

 

 

 

Cash and cash equivalents at beginning of year

 

134

244

244

 

 

 

 

 

Effect of foreign exchange rate variation

 

-

3

1

 

 

 

 

 

Net cash and cash equivalents at end of year

(210)

139

134

 

 

 

 

 

 

 

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

 

1.    GENERAL INFORMATION

 

Premier African Minerals Limited ('Premier' or 'the Company'), together with its subsidiaries (the 'Group'), was incorporated and domiciled in the Territory of the British Virgin Islands under the BVI Business Companies Act, 2004. The address of the registered office is Craigmuir Chambers, PO Box 71, Road Town, Tortola, British Virgin Islands. Premier's shares were admitted to trading on the London Stock Exchange's AIM market on 10 December 2012.

 

The Group's operations and principal activities are the mining, development and exploration of mineral reserves, primarily on the African continent. The presentational currency of the condensed consolidated interim financial statements is US Dollars.

 

2.    BASIS OF PREPARATION

 

These unaudited condensed consolidated interim financial statements for the six months ended 30 June 2018 were approved by the Board and authorised for issue on 27 September 2018.

 

These interim financial statements have been prepared in accordance with the recognition and measurement principles of the International Financial Reporting Standards ("IFRS") as endorsed by the EU. 

The accounting policies applied in the preparation of these consolidated interim financial statements are consistent with the accounting policies applied in the preparation of the consolidated financial statements for the year ended 31 December 2017.

 

The figures for the six months ended 30 June 2018 and 30 June 2017 are unaudited and do not constitute full accounts. The comparative figures for the year ended 31 December 2017 are extracts from the 2017 audited accounts. The independent auditor's report on the 2017 accounts was qualified relating to Provision - rehabilitation and included an emphasis of matter - relating to a material uncertainty related to going concern.

 

 

 

Going Concern

 

The Directors have prepared cash flow forecasts for the next 12 months, taking into account forecast operating cash flow and capital expenditure requirements for its RHA Tungsten mine, exploration activities at Zulu, available working capital and forecast expenditure for the rest of the Group including overheads and other development costs. The forecasts include additional funding requirements which the directors believe will be met.

 

3.    SEGMENTAL REPORTING

 

Segmental information is presented in respect of the information reported to the Directors.

 

The RHA Tungsten Mine segment derives income primarily from the production and sale of wolframite concentrate. All other segments are primarily focused on exploration and on administrative and financing segments.

 

For the purposes of the current period, segmental information has been changed to separately report the revenue generating segments of RHA that operates the RHA Tungsten Mine and TCT IF.

Segmental results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

 

 

 

Six months to 30 June 2018

Six months to 30 June 2017

Year to 31 December 2017

 

(Unaudited)

(Unaudited)

(Audited Restated)

 

$ 000

$ 000

$ 000

Revenue

 

 

 

RHA Zimbabwe *

(166)

(173)

(368)

TCT Mozambique **

-

(120)

(246)

 

(166)

(293)

(614)

Operating loss

 

 

 

RHA Zimbabwe *

464

1 935

5 729

Zimbabwe

-

-

-

TCT Mozambique **

-

30

114

Corporate

893

1 324

2 419

 

1 357

3 289

8 262

Loss before taxation

 

 

 

RHA Zimbabwe *

532

2 447

15 684

Zimbabwe

-

-

-

TCT Mozambique **

-

63

136

Corporate

912

1 986

3 891

 

1 444

4 496

19 711

Assets

 

 

 

Non-current assets

 

 

 

RHA Zimbabwe *

-

8 055

-

Zimbabwe

4 426

3 521

4 291

TCT Mozambique **

-

4 053

-

Corporate

6 603

5 729

6 459

 

11 029

21 358

10 750

Current assets

 

 

 

RHA Zimbabwe *

204

931

223

Zimbabwe

3

5

8

TCT Mozambique **

-

173

-

Corporate

                      92

202

324

 

299

1 311

555

Liabilities

 

 

 

Non-current liabilities

 

 

 

RHA Zimbabwe *

1 064

853

1 014

Zimbabwe

-

-

-

TCT Mozambique **

-

3 111

-

Corporate

-

(1 194)

-

 

1 064

2 771

1 014

Current liabilities

 

 

 

RHA Zimbabwe *

1 723

3 598

1 428

Zimbabwe

1

6

1

TCT Mozambique **

-

259

-

Corporate

1 648

941

969

 

3 372

4 804

2 398

 

* Represents 100% of the results and financial position of RHA Tungsten (Private) Limited ("RHA") whereas the Group owns 49%.

 

** Represents 100% of the results and financial position of TCT Industrias Florestais Limitada ("TCT IF") whereas the Group controls 52%.

 

 

4.    INTANGIBLE EXPLORATION AND EVALUATION ASSETS

 

 

 

Exploration & Evaluation assets

Other intangible assets

Restated total

 

$ 000

$ 000

$ 000

 

 

 

 

Opening carrying value January 2017

3 468

1 968

5 436

Expenditure on Exploration and evaluation

180

-

180

Closing carrying value 30 June 2017

3 648

1 968

5 616

Expenditure on Exploration and evaluation

643

(1 968)

(1 325)

Opening carrying value January 2018

4 291

-

4 291

Expenditure on Exploration and evaluation

135

-

135

Closing carrying value 30 June 2018

4 426

-

4 426

 

 

 

 

 

Exploration and evaluation assets at 30 June 2018 relate to the Zulu Lithium and Tantalite Project located in Zimbabwe (30 June 2017: Zulu Lithium and Tantalite Project and TCT IF Limestone, 31 December 2017: Zulu Lithium and Tantalite Project only).

 

During the period to 30 June 2018 $0.135 million was capitalised to the Zulu Lithium and Tantalite Project (six months to 30 June 2017: $0.180 million, year to 31 December 2017: $0.276 million.

 

Exploration work conducted on Zulu during the period indicated that both lithium and tantalum recovery may be a viable option. The Group views this project as strategic and exploration work will be continued in the future, cash flow permitting.

 

 

5.    INVESTMENTS

 

 

Circum

Arc Minerals

 

Available-for-sale:

Minerals

Mining

Total

Opening carrying value 2016(1)

4 000

-

4 000

Acquisition at fair value

-

250

250

Opening carrying value 2017

4 000

250

4 250

Shares acquired (5)(6)

4 152

50

4 202

Fair value adjustment (7)(8)

(1 889)

(104)

(1 993)

Closing carrying value 2017

6 263

196

6 459

 

 

 

 

Reconciliation of movements in investments

 

 

 

Investment in Circum Minerals Limited  - 15 May 2014

1 400

-

1 400

Fair value adjustment - February 2015(2)

1 100

-

1 100

Fair value adjustment - June 2015(3)

1 500

-

1 500

Investment in Casa Mining Limited(4)

-

250

250

Opening carrying value 2017

4 000

250

4 250

Acquisition at fair value (5)

-

50

50

Acquisition at fair value 2017(6)

2 936

-

2 936

Issue of Premier shares (6)

1 216

-

1 216

Fair value adjustment - 31 December 2017(7)(8)

(1 889)

(104)

(1 993)

Opening carrying value 2017

6 263

196

6 459

Fair value adjustment - 30 June 2018(8)

-

144

144

 

6 263

340

6 603

 

Premier's investment in Circum Minerals Limited ('Circum') is classified as an available-for-sale investment and as such is required to be measured at fair value at each reporting date. As Circum is unlisted there are no quoted market prices.

 

On 6 November 2017, Arc Minerals (formerly known as Ortac Resources Limited) announced that it would make an offer to acquire all of the outstanding shares in Casa ("Sale Shares") for a consideration of 14.85 shares in Arc Minerals for each Sale Share (the "Casa Offer").  he Casa offer closed on 10 May 2018 and Premier converted 412,500 Casa shares into 6,128,822 new Arc Minerals shares. As at 30 June 2018, the fair value of the investment in Arc Minerals increased by $0.144 million.

 

 

6.    PROPERTY, PLANT AND EQUIPMENT

 

 

Mine

Plant & Equipment

Land & Buildings

Total

 

$ 000

$ 000

$ 000

$ 000

Cost

 

 

 

 

At 1 January 2017

7 682

3 515

813

12 010

Additions

493

1 182

29

1 704

At 30 June 2017

8 175

4 697

842

13 714

Additions

352

(478)

14

(112)

Transfer to E&E

(119)

0

0

(119)

Disposal of TCT

-

(104)

(4)

(108)

At 31 December 2017

8 408

4 115

852

13 375

Additions

-

-

-

-

At 30 June 2018

8 408

4 115

852

13 375

 

 

 

 

 

Depreciation

 

 

 

 

At 1 January 2017

1 402

704

129

2 235

Charge for the period

252

536

55

843

At 30 June 2017

1 654

1 240

184

3 078

Charge for the period

387

74

74

535

Disposal of TCT

-

(39)

(8)

(47)

Impairment of RHA

6 367

2 840

602

9 809

At 31 December 2017

8 408

4 115

852

13 375

Charge for the period

-

-

-

-

At 30 June 2018

8 408

4 115

852

13 375

 

 

 

 

 

Net Book Value

 

 

 

 

At 30 June 2017 (unaudited)

6 521

3 457

658

10 636

At 31 December 2017 (audited)

-

-

-

-

At 30 June 2018 (unaudited)

-

-

-

-

 

 

 

7.    BORROWINGS

 

 

 

30 June

30 June

31 December

 

2018

2017

2017

 

(Unaudited)

(Unaudited)

(Audited)

 

$ 000

$ 000

$ 000

 

 

 

 

Loan G Roach - see related party transactions

534

312

216

 

534

312

216

 

 

 

 

Reconciliation of movement in borrowings

 

 

 

As at 1 January

216

568

566

Loans received

300

-

-

Loans repaid through conversion to equity (1)

-

-

(100)

Offset of loan against receivable (2)

-

-

(196)

Repayment

-

(66)

(65)

Debt settlement

-

(196)

0

Accrued interest

18

6

11

As at 31 December

534

312

216

 

 

 

 

Current

534

312

216

Non-current

-

-

-

 

534

312

216

 

 

Borrowings comprise loans from a related party and a non-related party.

 

1)    On 15 September 2015, George Roach provided a $0.300 million loan direct to Premier for the use at RHA Tungsten (Pty) Limited ("RHA"). The loan is unsecured and accrues interest at a rate of 3% per annum. As at 28 March 2017, the loan and accrued interest totalled $0.309 million. On 28 March 2017 the Company announced that it had amended the terms of the existing loan agreement ("Loan") with George Roach through the grant of conversion rights. The Board granted conversion rights in respect of the Loan, which can now be converted into new ordinary shares at a price of 0.5p per new ordinary share.

 

2)    On 4 June 2018, the Company entered into a loan with a company owned by a Trust of which George Roach is a beneficiary, for a gross value of $0.300 million. 

 

The Loan is non-interest bearing and has a maturity date, 30 November 2018, and will provide additional general working capital while the Company looks to bring finality to the negotiations currently underway in respect of both Zulu Lithium Private Limited and RHA Tungsten Private Limited. The Company will repay the entire Loan, including all fees within five days following the maturity of the Loan. The Loan carries an implementation fee of $0.015 million (5%) and a redemption fee of $0.015 million (5%), collectively the fees ("Fees"). The terms and conditions of the Loan contain a negative pledge provision in respect of the Company relating to certain types of indebtedness and standard events of default. The Loan is not convertible, nor does it include share-based repayment or warrants.

 

 

 

8.    SHARE CAPITAL

 

Authorised share capital

 

At the AGM held on 9 August 2018, the shareholders approved the increase in authorised share capital to 9 billion (30 June 2017 and 31 December 2017: 7 billion) ordinary shares of no par value.

Issued share capital

 

 

Number of Shares

 

 

 '000

 '000

As at 1 January 2017 - Audited restated

2 111 611

29 457

Shares issued under subscription agreements

1 044 384

4 039

Shares issued on conversion of loans and loan notes

1 235 027

3 714

As at 30 June 2017 - Unaudited

4 391 022

37 210

Shares issued under subscription agreements

1 592 507

6 666

Shares issued on conversion of loans and loan notes

74 720

493

Shares issued on warrant exercise

3 559

12

Shares issued to increase holding

513 159

2 579

As at 31 December 2017 - Audited

6 574 967

46 960

Shares issued on warrant exercise

250 000

563

As at 30 June 2018 - Unaudited

6 824 967

47 523

 

 

Reconciliation to balance as stated in the consolidated statement of financial position

 

 

Issued

Share Issue

Share Capital

 

Share Capital

Costs

(Net of Costs)

 

$ 000

$ 000

$ 000

 

 

 

 

As at 31 December 2016 - Audited restated

27 886

(253)

27 633

Shares Issued

7 408

(1 911)

5 497

As at 30 June 2017 - Unaudited

35 294

(2 164)

33 130

Shares Issued

11 666

(638)

11 028

As at 31 December 2017 - Unaudited

46 960

(2 802)

44 158

Shares Issued

563

(56)

507

As at 30 June 2018 - Unaudited

47 523

(2 858)

44 665

 

 

9.    TAXATION

 

There is no taxation charge for the period ended 30 June 2018 (30 June 2017 and 31 December 2017: Nil) because the Group is registered in the British Virgin Islands where no corporate taxes or capital gains tax are charged. However, the Group may be liable for taxes in the jurisdictions of the underlying operations.

The Group has incurred tax losses in West Africa and Zimbabwe; however a deferred tax asset has not been recognised in the accounts due to the unpredictability of future profit streams. 

Contingent liability

The Group operates across different geographical regions and is required to comply with tax legislation in various jurisdictions. The determination of the Group's tax is based on interpretations applied in terms of the respective tax legislations and may be subject to periodic challenges by tax authorities which may give rise to tax exposures.

 

 

10.  LOSS PER SHARE

 

The calculation of loss per share is based on the loss after taxation attributable to the owners of the parent divided by the weighted average number of shares in issue during each period.

 

 

 

Six months to 30 June 2018

Six months to 30 June 2017

Year to 31 December 2017

 

(Unaudited)

(Unaudited)

(Audited Restated)

 

$ 000

$ 000

$ 000

 

 

 

 

Net loss attributable to owners of the company ($ 000)

(1 075)

(3 154)

(12 657)

 

 

 

 

Weighted average number of Ordinary Shares in calculating basic earnings per share ('000)

8 392 279

3 041 598

4 809 908

 

 

 

 

Basic loss per share (US cents)

(0.000)

(0.001)

(0.003)

 

 

As the Group incurred a loss for the year, there is no dilutive effect from the share options and warrants in issue or the shares issued after the reporting date.

 

11.  EVENTS AFTER THE REPORTING DATE

 

11.1        On 27 June 2018 the Company announced that the repayment date in respect of the director loan it entered into with a company owned by a trust of which Mr. George Roach is a beneficiary has been extended to the 30 November 2018.

 

11.2        On 20 July 2018 the Company announced the appointment of Mr. Michael Foster, a Senior Non-Executive Director on the Board as Non-Executive Chairman.

11.2       The Company further announced on the 29 July 2018 that it had RHA's management undertake an in-depth assessment of alternatives to reopen RHA. The first three original options are based on a limited drilling programme ("Drill Programme") being completed. The Drill Programme is broken down into two parts, the first part will include fifteen 50-meter boreholes to establish at what depth below the current pit floor, previously predicted ore grades are likely to materialise, and whether or not the open pit can be profitably brought back into production.

 

              There has been a substantial and sustained increase in the Price of Wolframite ("APT") after the reporting period. This increase, with the fact that RHA can brought back into production at short notice has resulted in a potential fourth option. These options are summarised below;

 

Option 1

Re-commence of existing underground operations at 6,000 tpm and maintain same mining rate for life of mine. Four-month stope development will access required tonnage at projected in situ grade of 7,1 kg per tonne WO₃.

Option 2

Combines Option 1 plus the construction of a new decline shaft to allow vehicle access direct to the underground operations and a substantial increase in ore delivery to the plant at significantly reduced mining cost.

Option 3

Combines Option 1 with reopening of the open pit and is the option most likely to see best use of the XRT sorter, significant increases in throughput and lowest capital expenditure.

Option 3

Wolframite production could commence from as early as the second month of mining and without any further drilling as a result of the improved APT price.

 

              The Company has engaged an independent consultancy to review Option 4 as this does not require the Drill Programme, and the Company considers that it is in the best interests of the Company and its shareholders if mining and processing operations are restarted at RHA.

 

11.3       Prior to the AGM held on 9 August 2018, Mr. Russel Swarts decided not to stand for reappointment as a director of the Company.

11.4       On 13 August 2018 the Company announced that it had received written confirmation from the Ministry of Mines and Mining Development (the "Ministry of Mines") that under the amended Indigenisation and Economic Empowerment Act, RHA is no longer required to comply with indigenisation policies and that the proposed restructuring of RHA can proceed without approval from the Ministry of Mines. In the same announcement, the Company confirmed that it had received a letter from the Ministry of Industry, Commerce and Enterprise Development of Zimbabwe (the "Ministry"), which has responsibility for indigenisation, confirming inter alia that:
 

i. Premier's proposal for the restructuring of RHA had been favourably received by the relevant Ministry and relevant stakeholders; and

 

ii.                Progress has been made and our continued support has been requested by the Ministry.

 

In light of the reassurances received, Premier has continued to work with the Ministry while the procedural Governmental approvals are dealt with.  

 

11.5       On 14 August 2018 the Company announced a placing to raise £750,000 before expenses at an issue price of 0.18 pence per new ordinary share. Following the reassurance received on by the Ministry of Mines and Ministry, the Company commissioned a drilling programme at RHA of up to 2,750 meters with the objective of expanding the Resource base as well as increasing the confidence levels of both the open pit and underground Resources with the target of de-risking the future development of RHA. 

 

11.6       On 17 September 2018, the Company reported that it has been unable to reach final terms with Cadence Minerals plc to fully fund the Definitive Feasibility Study of the Zulu Lithium and Tantalum Project as announced on 27 June 2018.

 

 

 

 

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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