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Blencowe Resources (BRES)

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Wednesday 02 June, 2021

Blencowe Resources

Half-year Report

RNS Number : 5661A
Blencowe Resources PLC
02 June 2021
 

Date: 2 June 2021

 

Blencowe Resources Plc

("Blencowe" or the "Company")

 

 

Interim Financial Statements

for the six month period ended 31 March 2021

 

The Company is pleased to announce its Interim Results for the six-month period to 31 March 2021.

 

Electronic copies of the report will be available at the Company's website www.blencoweresourcesplc.com

For further information please contact:

 

Blencowe Resources

Sam Quinn

 

www.blencoweresourcesplc.com

Tel: +44 (0) 1624 681 250

[email protected]

 

Investor Enquiries

Sasha Sethi

Tel: +44 (0) 7891 677 441

[email protected]

 

Brandon Hill Capital Limited

Jonathan Evans

Tel: +44 (0)20 3463 5000

[email protected]

 

First Equity Limited

Jason Robertson

Tel: +44 (0)20 7330 1883

[email protected]

 

Interim Management Report

Dear Shareholder,

 

It is with pleasure we present you with the Interim Results for the Company, and an update on various

activities underway within Blencowe. The past year has been a challenging one for everybody and it has forced us all to adapt to continue to work, using different methodologies wherever necessary to achieve outcomes.  I am pleased to report that the team within Blencowe, and that includes the wider support network of parties that help and support us everywhere, have all pulled together superbly and found ways to deliver solutions to overcome all challenges.  It is times like this that board, management and key relationships are tested and I would like to give each and every party included under this umbrella my heartfelt thanks for their efforts.  They have been appreciated.

 

We have always known that we have a significant resource asset at Orom-Cross, and post the RTO in April 2020 we set out to put as much value onto this project as we could, with a goal to remain efficient in all we did, both in terms of time and cost.  In the past year we have achieved a number of key milestones that continue to add value, culminating in our maiden JORC Resource estimate for over 16 million tonnes graphite, and this represents a starting point as we have explored only the smallest fraction of what is available there.  We have identified two excellent deposits, one of particular high grade, and we drilled them out in a substantial programme that completed in 2H 2020.  Samples were sent to South Africa for assaying, and others to Canada where our metallurgical partner is currently well underway with what is turning out to be a successful test program to deliver a quality concentrate that will be in high demand as we move into production.

 

We continue to build on these early successes and we have recently initiated a second substantial drilling program in the field at Orom-Cross to further delineate these two deposits and prepare them for mining planning and pit designs that will be required within the feasibility study.  Our plan remains straightforward, to continue building this project towards a decision to mine whilst utilising all our experience to ensure that all key requirements are suitably covered to de-risk the process.

 

Blencowe remains a firm believer that the push for renewable energy will continue gathering huge momentum moving forward, and the transition from fossil fuel engines to electric vehicles (EVs) will play a central role in this.  Currently the lithium-ion battery is the accepted technology that will power these EVs and graphite remains a core component within the anode inside the battery.  It is therefore logical to assume demand for graphite will remain highly leveraged to growth in demand for lithium ion batteries, and over the next few years Blencowe intends to bring into production one of the lower cost, high grade graphite projects in the world, located in a safe long term jurisdiction for development of such a project.

 

We continue to appreciate your support as a shareholder as we continue this exciting journey.

 

Mike Ralston

Chief Executive Officer

 

Responsibility Statement of the Directors in respect of the Interim Report

The Directors are responsible for preparing the Interim Financial Statements in accordance with applicable law and regulations. In addition, the Directors have elected to prepare the Interim Financial Statements in accordance with International Financial Reporting Standards ("IFRSs"), as adopted by the European Union ("EU").

 

The Interim Financial Statements are required to give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for that period.

In preparing these Interim Financial Statements, the Directors are required to:

· select suitable accounting policies and then apply them consistently;

· present information and make judgements that are reasonable, prudent and provides relevant, comparable and understandable information;

· provide additional disclosures when compliance with the specific requirements in IFRS is insufficient to enable users to understand the impact of particulars transactions, other events and conditions on the entity's financial position and financial performance; and

· make an assessment of the Group's ability to continue as a going concern.

The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the Group's transactions and disclose with reasonable accuracy at any time its financial position of the Group to enable them ensure that the financial statements comply with the requirements of the Companies Act 2006. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and Interim Financial Statements.  Legislation governing the preparation and dissemination of Interim Financial Statements may differ from one jurisdiction to another.

We confirm that to the best of our knowledge:

· the Interim Financial Statements, prepared in accordance with International Financial Reporting Standards as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group for the period;

· the Director's report includes a fair review of the development and performance of the business and the position of the group, together with a description of the principal risks and uncertainties that they face; and

· the annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the group's performance, business model and strategy.

 

Consolidated Statement of Comprehensive Income for the six month period ended 31 March 2021

 



6 months ended

31 Mar 2021

6 months ended

31 Mar 2020

12 months ended

30 Sep 2020



(Unaudited)

(Unaudited)

(Audited)


Notes

GBP

GBP

GBP






Exploration costs


(1,999)

-

(9,736)

Administrative fees and other expenses

5

(304,238)

(481,752)

(1,015,053)

Operating loss


(306,237)

(481,752)

(1,024,789)






Finance costs


(23,444)

-

(33,295)

Loss before tax


(23,444)

(481,752)

(1,058,084)






Income tax


-

-

-






Loss for the period and total comprehensive loss for the period


(329,681)

(481,752)

(1,058,084)






Basic and diluted loss per share (pence)

7

(0.01)

(1.52)

(1.74)

 

 

There was no other comprehensive income for the period ended on 31 March 2021.

 

Consolidated Statement of Financial Position as at 31 March 2021

 

 

 

Consolidated Statement of Changes in Equity for the six month period ended 31 March 2021

 


Share capital

Share premium

Warrant reserves

Retained earnings

Total equity


GBP

GBP

GBP

GBP

GBP







Balance as at 30 Sep 2019

450,000

209,983

33,778

(406,639)

287,122







Total comprehensive loss for 6 months






Loss for the period

-

-

-

(481,752)

(481,752)

Total comprehensive loss

-

-

-

(481,752)

(481,752)







Contributions from equity holders






Issue of warrants

-

-

16,929

-

16,929

Total contributions from equity holders

-

-

16,929

-

16,929







Balance as at 31 Mar 2020

450,000

209,983

50,707

(888,391)

(177,701)







Total comprehensive loss for 6 months






Loss for the period

-

-

-

(576,332)

(576,332)

Total comprehensive loss

-

-

-

(576,332)

(576,332)







Contributions from equity holders






New shares issued

333,333

3,666,667

-

-

4,000,000

Issue of warrants

-

-

49,764

-

49,764

Adjustment on consolidation - IFRS 9




11,171

11,171

Total contributions from equity holders

333,333

3,666,667

49,764

11,171

4,060,935







Balance as at 30 Sep 2020

783,333

3,876,650

100,471

(1,453,551)

3,306,903







Total comprehensive loss for 6 months






Loss for the period

-

-

-

(329,681)

(329,681)

Total comprehensive loss

-

-

-

(329,681)

(329,681)







Contributions from equity holders






New shares issued

94,925

1,093,992

-

-

1,188,917

Share issued costs

-

(86,496,)

-

-

(86,496)

Warrants reserve

-

-

77,194

-

77,194

Warrants exercised



(13,064)

13,064

-

Adjustment on consolidation - IFRS 9




(211,842)

(211,842)

Total contributions from equity holders

94,925

1,007,496

64,130

(198,778)

967,773







Balance as at 31 Mar 2021

878,258

4,884,146

164,601

(1,982,010)

3,944,995

 

Statement of Cash Flows for the six month period ended 31 March 2021

 



As at

31 Mar 2021

As at

31 Mar 2020

As at

30 Sept 2020



(Unaudited)

(Unaudited)

(Audited)


Notes

GBP

GBP

GBP

Operating activities





Loss after tax

5

(329,681)

(481,752)

(1,058,084)

Amortisation


1,349

-

1,919

Finance costs


23,444

-

33,295

Share issue/warrant cost


64,130

16,929

66,693

Changes in working capital





Decrease/(increase) in trade and other receivables


(12,697)

3,497

(27,426)

Increase/(decrease) in trade and other payables


(229,635)

407,583

131,821

Net cash flows from operating activities


(483,090)

(53,743)

(851,782)






Cash flows from financing activities





Investment in exploration assets


(213,956)

-

(1,084,354)

Net cash flows from investment activities


(213,956)


(1,084,354)






Financing activities





Shares issued


1,188,917

-

2,000,000

Shares issued (cost)


(86,496)

-

-

Net cash flows from financing activities


1,102,421

-

2,000,000






Increase in cash and short-term deposits


405,375

(53,743)

63,864






Cash and short-term deposits brought forward


205,856

141,992

141,992






Cash and cash equivalents at end of period


611,231

88,249

205,856

 

Notes to the Financial Statements for the six month period ended 31 March 2021

1.  General

Blencowe Resources Plc (the "Company") is a public limited company incorporated and registered in England and Wales on 18 September 2017 with registered company number 10966847 and its registered office situated in England and Wales at 25 Bilton Road, Rugby, CV22 7AG.

The Group did not earn any trading income during the period under review but incurred expenditure in developing its principal assets.

2.  Accounting Policies

Basis of preparation

The interim financial statements of the Group are unaudited condensed financial statements  for the 6 month period ended 31 March 2021.

The accounting policies applied by the Group in these Interim Financial Statements, are the same as those applied by the Group in its consolidated financial statements, and have been prepared on the basis of the accounting policies applied for the financial year to 30 September 2020 which have been prepared in accordance with IFRS as adopted by EU for. The Group Financial Statements have been prepared using the measurement bases specified by IFRS each type of asset, liability, income and expense.

The Group Financial Statements are presented in £, which is the Group's functional currency. All amounts have been rounded to the nearest pound, unless otherwise stated.  

Comparative figures  

The comparative figures have been presented as the Group Financial Statements cover the 6 month period ended 31 March 2020 and the 12 month period ended 30 September 2020.

3.  Critical accounting estimates and judgments

In preparing the Group 's Interim Financial Statements, the Directors have to make judgments on how to apply the Group's accounting policies and make estimates about the future. The Directors do not consider there to be any critical judgments that have been made in arriving at the amounts recognised in the Group Financial Statements.

4.  Significant accounting policies

The accounting policies adopted are consistent with those followed in the preparation of the annual financial statements of Blencowe Resources Plc for the year ended 30 September 2020.  A copy of these financial statements is available on the Group website at https://blencoweresourcesplc.com/

5.  Administrative fee and other expenses


6 months ended

 31 Mar 2021

6 months ended

31 Mar 2020

12 Months ended

30 Sep 2020


(Unaudited)

(Unaudited)

(Audited)


GBP

GBP

GBP

Directors' remuneration

68,471

45,052

107,102

Professional fees

47,627

220,701

437,340

Salaries (see note 7)

18,000

-

27,500

Listing fees

19,593

77,830

26,599

Audit fees

12,500

75,000

25,000

Fees payable to group auditors for non-audit services

-

-

69,275

Share issue/warrant cost

77,194

16,929

66,693

Project Costs

-

10,530

-

Administration fees

28,500

9,000

24,486

Broker fees

3,244

2,500

190,833

Travelling expenses

971

7,260

7,260

Miscellaneous fees

27,868

16,950

32,965

Total

304,238

481,752

1,015,053

 

The Group did not employ any staff during the period other than Directors. The Directors are the only members of key management and their remuneration related solely to short term employee benefits.

6.  Trade and other receivables


6 months ended

 31 Mar 2021

6 months ended

31 Mar 2020

12 Months ended

30 Sep 2020


(Unaudited)

(Unaudited)

(Audited)


GBP

GBP

GBP

Loan to CARU

-

257,184

-

Other receivables

22,002

7,344

67,902

Prepayments

62,715

-

4,119


84,717

264,528

72,021

Less: provision

-

(11,835)

-

Total

84,717

252,693

72,021

 

7.  Creditors: Amounts falling due within one year


6 months ended

 31 Mar 2021

6 months ended

31 Mar 2020

12 Months ended

30 Sep 2020


(Unaudited)

(Unaudited)

(Audited)


GBP

GBP

GBP

Payables

131,138

209,881

281,726

Other payables

233,049

80,000

175,225

Accruals and provision

13,227

228,762

41,637

Total

377,415

518,643

498,588

 

8.  Creditors: Amounts falling after one year

CARU entered into an agreement for surface rights over the land in the mineral area of the licence. The land owners granted CARU a 49 year lease over an area. The lease is payable in 11 instalments

effective 31st January 2020.


6 months ended

 31 Mar 2021

6 months ended

31 Mar 2020

12 Months ended

30 Sep 2020


(Unaudited)

(Unaudited)

(Audited)


GBP

GBP

GBP

Total payable at the beginning of the period

1,024,737

-

-

Addition to non-current liabilities

-

-

1,009,049

Interest charged during the period

22,685

-

11,923

Exchange loss on valuation

(49,879)

-

3,765

Total payable as at period end

997,543

-

1,024,737





Analysis between current and non-current liability




Payable within 12 months

233,049

-

175,225

Payable after 12 months

764,494

-

849,512


997,543


1,024,737

 

The value of the lease is measured at the present value of the contractual payments due to the lessor

over the lease term , with the discount rate of 5%.

9.  Loss per share

The calculation of the basic and diluted loss per share is based on the following data:


6 months ended

 31 Mar 2021

6 months ended

31 Mar 2020

12 Months ended

30 Sep 2020


(Unaudited)

(Unaudited)

(Audited)

Earnings

GBP

GBP

GBP

Loss from continuing operations for the period attributable to the equity holders of the Group

(329,681)

(481,852)

(1,058,084)

Number of shares




Weighted average number of Ordinary Shares for the purpose of basic and diluted earnings per share




3,108,550,648

31,666,664

60,707,758

Basic and diluted loss per share (pence)

(0.01)

(1.52)

(1.74)

 

There are no potentially dilutive shares in issue.

10.  Related party transactions

The are no related party transactions during the period except for the Directors' remuneration, which have been disclosed in note 5.

 

Sam Quinn is a director and shareholder of the Company and a Director of Lionshead Consultants Limited.  During the period, Lionshead Consultants Limited charged fees for consultancy fees of £12,000 (31 March 2020: £Nil and 30 Sep 2020: £10,000).

11.  Events after the reporting date

The total number of shares raised by the Company since 31 March 2021 up to the date these Interim Financial Statements were signed were 886,667, of which 686,667 were warrants exercised.

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