REG-Conroy Gold & Natural Resources Plc: Final Results
29/11/2023 12:45
29 November 2023
Conroy Gold and Natural Resources plc
(“Conroy Gold” or “the Company”)
FINAL RESULTS FOR THE YEAR TO 31 MAY 2023
NOTICE OF ANNUAL GENERAL MEETING
Conroy Gold and Natural Resources plc (AIM: CGNR), the gold and base metals
exploration and development company, is pleased to report its audited accounts
for the year to 31 May 2023.
Highlights:
* Joint Venture ("JV") with Demir Export A.Ş. (“Demir Export”) with the
primary aim of developing one or more gold mines in the Longford – Down
Massif in Ireland became fully operational. The investment by Demir Export is
directly into three operating companies, wholly owned subsidiaries of Conroy
Gold, which have been established to hold and operate the various licences in
the JV.
* A major feature of the year was the discovery of a second district scale
gold trend in the Longford-Down Massif in Ireland, along a geological
structure known as the Skullmartin Fault Zone.
* An extensive drilling programme across the licence area has yielded
important and exciting results. These included a continuous gold
intersection of 40m @ 1.2 g/t Au discovered on the Derryhennet section of the
very large Clay Lake gold target in Co Armagh indicating the overall potential
of the Clay Lake gold target for high tonnage and gold content.
* In addition step-out and stockwork drilling on the Clontibret gold deposit
has shown continuity between the Clontibret gold deposit and the Corcaskea
gold target.
* At Creenkill, on the newly discovered gold trend, visible gold and gold
assay results of up to 123g/t Au (4oz tonne gold) were discovered in quartz
breccia bedrock.
Chairman, Professor Richard Conroy, commented:
“The Joint Venture with Demir Export is now fully operational and during the
year an extensive drill programme of 6,000m was undertaken and a new gold
district discovered. Excellent drilling results have indicated the potential
of the Clay Lake good target for high tonnage and gold content and the
continuity of the Clontibret gold deposit with the Corcaskea gold target. We
look forward to continued successful progress.”
Annual Report and Accounts for the year to 31 May 2023
The full audited annual report and accounts for the year to 31 May 2023 will
be posted to shareholders today and will be published on the Company's website
(www.conroygold.com) shortly. Key elements can also be viewed at the bottom of
this announcement.
Annual General Meeting
The Annual General Meeting of the Company ("AGM") will be held at The Conrad
Dublin Hotel, Earlsfort Terrace, Dublin at 12 noon on 21 December 2023. A copy
of the notice of AGM can be viewed on the Company's website.
For further information please contact:
Conroy Gold and Natural Resources PLC Professor Richard Conroy, Chairman +353-1-479-6180
Allenby Capital Limited (Nomad) Nick Athanas / Nick Harriss +44-20-3328-5656
Peterhouse Capital Limited (Broker) Lucy Williams / Duncan Vasey +44-20-7469-0930
Lothbury Financial Services Michael Padley +44-20-3290-0707
Hall Communications Don Hall +353-1-660-9377
Visit the website at: www.conroygold.com
Key Information Extracted from Annual Report
Chairman's Statement
Dear Shareholder,
I have great pleasure in presenting the Company's Annual Report and
Consolidated Financial Statements for the year ended 31st May 2023. The year
was one of further highly successful progress for Conroy Gold and Natural
Resources PLC (the “Company” or “Conroy Gold”), during which a second
district scale gold trend was discovered and the Joint Venture ("JV") with
Demir Export A.Ş. (“Demir Export”) became fully operational.
A major feature of the year was the discovery of a second district scale gold
trend in the Longford-Down Massif in Ireland, where the Company previously
discovered the Orlock Bridge gold trend, also a district scale gold trend.
The new gold trend lies along a geological structure known as the Skullmartin
Fault Zone, lying to the south of the Orlock Bridge Fault Zone.
This new gold trend, the Skullmartin gold trend, extends for approximately
24km and, like the Orlock Bridge gold trend, has the potential to hold many
gold targets. The Company has already identified a highly exciting discovery
along the new trend at Creenkill in County Armagh with visible gold and gold
assay results of up 123 g/t Au (4oz gold per tonne).
As well as the discovery of the new gold trend, an extensive drilling
programme across the JV licence area has yielded other highly important and
exciting results, both during the period under review and post year end. The
drilling programme included step-out and stockwork drilling on the Clontibret
gold deposit. This has shown continuity between the Clontibret gold deposit
and the Corcaskea gold target, where historic trenching demonstrated high gold
grades and has extended the deposit 400 metres to the North East.
Drilling at the Clay Lake gold target, which is a very extensive gold target
nearly 3 km in length and in places 2 km wide, has yielded excellent results
including a continuous intersection of 40 metres at 1.2 g/t Au. The Clay
Lake gold target area could have the potential to contain a major gold
deposit.
The Company’s land position over both gold trends has been secured with
licences (in both Ireland and Northern Ireland) extending over an area of more
than 1,000 sq km.
The JV with Demir Export has a primary focus on the development of a gold
mine, or mines, along the two district scale gold trends which have been
discovered. To administer the JV project, three 100% owned subsidiaries of
Conroy Gold have been established. These are: (i) Conroy Gold (Clontibret)
Limited which now holds the Clontibret licence; (ii) Conroy Gold (Armagh)
Limited which now holds the Mines Royal Options and Prospecting Licences in
Northern Ireland and; (iii) Conroy Gold (Longford Down) Limited which holds
the remaining JV licences. These subsidiaries are now fully operational.
The JV, which is an earn-in JV, is structured over three phases of work:
• Phase 1 - €4.5 million plus
(plus €1 million on signing agreement) to earn an initial 25% in the three
subsidiaries;
• Phase 2 - €4.5 million plus to
earn a further 15%; and
• Phase 3 - all expenditure required
to bring a given mining project to shovel ready status (including all planning
and land acquisition costs) to earn a further 17.5% giving a total 57.5% in
that given project with Conroy Gold retaining the right to a 42.5% interest or
to avail of one or other of various options including a carry option through
to production or a net smelter royalty.
Demir Export have now invested in excess of €4.5 million since March 2022 en
route an anticipated investment of over €6 million which will be required to
complete Phase 1. Demir Export is a long-established mining company with
interests in iron, coal, gold and base metals, including zinc and copper.
Demir Export is owned by the Koç family who also control and largely own the
largest industrial conglomerate in Türkiye (Turkey), a Fortune Global 500
Company and the leading investment holding company in Türkiye’s
(Turkey’s) fast expanding economy.
Conroy Gold also holds other licences in both Ireland and Finland which are
not part of the JV. The Company thus has an extensive exploration portfolio
and an established joint venture whose primary objective is to develop one, or
more, gold mines in the district scale gold trends which Conroy Gold has
discovered in Ireland.
Mining in Ireland has a long tradition and the Board and management of the
Company has already been involved in the discovery and development of two
major mines in Ireland (Galmoy and Lisheen). Excellent infrastructure is
already in place in the JV’s licence area including, power, a road network
and service facilities. There is an established mining tradition in the area
which, indeed, was once known as the Armagh-Monaghan Mining district.
Post Period
Work has continued on the licence areas with the intention to extend and
confirm the JV’s knowledge of the significant discoveries already made.
In County Armagh, 100m north-east of the existing find, quartz breccia in
bedrock was discovered with returns of up to 6.6 g/t gold; the first results
from Creenkill were promising with 11.5 g/t and 5.8 g/t intercepts with a
further 4 nearby anomalous gold areas being discovered; gold in bedrock was
also discovered at Drumavaddy, Slieve Glah.
In total, 6,000 metres of drilling has been completed and 500 samples taken.
Equity Interest in Karelian Diamond Resources PLC
During the year the Company acquired an equity interest in AIM quoted Karelian
Diamond Resources PLC (“Karelian Diamonds”) through entering into a debt
capitalisation arrangement including the issue of convertible loan notes. As
set out in the Financial Statements, the Company shares accommodation and
staff with Karelian Diamonds and the two companies have certain common
directors and shareholders. Karelian Diamonds and Conroy Gold reached
agreement that an amount equivalent to £125,000 owing to Conroy Gold be
capitalised into 5,000,000 new ordinary shares in the capital of Karelian
Diamonds at a price of 2.5 pence per Karelian Diamonds share. Remaining
outstanding amounts equivalent to £112,500 were incorporated into a
convertible loan with a term of 18 months attracting an interest rate of 5%
per annum. The loan note can be converted at the option of Conroy Gold, at a
price equivalent to 5 pence per Karelian Diamonds share.
Karelian Diamonds holds exploration licences in Northern Ireland in which
assay results indicate the possible presence of Nickel, Copper and Platinum
Group Metals mineralisation. Karelian Diamonds has also been conducting a
promising diamond exploration programme in the Kuhmo region of Finland and
owns the Lahtojoki diamond deposit in Finland, over which it holds a mining
concession.
Following the investment and the completion of a recent fundraising by
Karelian Diamonds, Conroy Gold holds 5.29% of the issued share capital of
Karelian Diamonds.
Environmental, Social and Governance Issues
These issues are of crucial importance at all stages of mining and
particularly as we move towards mining development. Great emphasis is placed
by the JV on Environmental, Social and Governance issues. Conroy Gold is
committed to high standards of corporate governance and integrity in all of
its activities and operations including rigorous health and safety compliance,
environmental consciousness and the promotion of a culture of good ethical
values and behaviour.
The Company conducts its business with integrity, honesty and fairness and
requires its partners, contractors and suppliers to meet similar ethical
standards. Individual staff members must ensure that they apply and maintain
these standards in all their actions.
As Chairman of the Board, I am required to regularly monitor and review the
Company’s ethical standards and cultural environment and, where necessary,
take appropriate action to ensure proper standards are maintained.
Financials
The loss after taxation from continuing operations for the financial year
ended 31 May 2023 was €362,829 (year ended 31 May 2022: €256,484). As at
the 31 May 2023, the Group had cash reserves of €557,934 (year ended 31 May
2022: €1,216,097) and net assets of €19,807,318 (year ended 31 May 2022:
€19,730,738).
A fundraising of £400,000 at 13.5 pence per Ordinary Share was successfully
arranged during the year, as announced by the Company on 20 June 2023.
Exploration expenditures on the JV licences are covered by the joint venture
agreement with Demir Export. The Company has other exploration interests,
both in Ireland and Finland, which are not covered by the JV which in due
course could lead to further discoveries by the Company. Ongoing general
working capital expenditures must also be covered by the Company.
Directors and Staff
I would like to express my deepest appreciation for the support and dedication
of the Directors, staff and consultants which has made possible the continued
progress and success which the Company has achieved during the year.
Professor Richard Conroy
Chairman
29 November 2023
Extract from the Independent Auditor's Report
The following section is extracted from the Independent Auditor's Report but
shareholders should read in full the Independent Auditor's Report contained in
the Annual Report.
In auditing the financial statements, we have concluded that the directors’
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate.
We draw attention to Note 1 in the financial statements, which indicates that
as at 31 May 2023 the group incurred a loss of €362,829 and the parent
company incurred a loss of €357,617 and, as of that date, the group and
parent company had net current liabilities of €3,161,475 and €2,777,541
respectively.
As stated in Note 1, these events or conditions indicate that a material
uncertainty exists that may cast significant doubt on the group’s and parent
company’s ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
Our evaluation of the directors’ assessment of the group and parent
company’s ability to continue to adopt the going concern basis of accounting
included:
* obtaining an understanding of the group and parent company’s relevant
controls over the preparation of cash flow forecasts and approval of the
projections and assumptions used in cash flow forecasts to support the going
concern assumption;
* assessing the design and determining the implementation of these relevant
controls;
* evaluating directors’ plans and their feasibility by agreeing the inputs
used in the cash flow forecast to expenditure commitments and other supporting
documentation;
* challenging the reasonableness of the assumptions applied by the directors
in their going concern assessment;
* obtaining confirmations received by the group and parent company from the
directors and former directors evidencing that they will not seek repayment of
amounts owed to them by the group and parent company within 12 months of the
date of approval of the financial statements, unless the group and/or parent
has sufficient funds to repay;
* assessing the mechanical accuracy of the cash flow forecast model; and
* assessing the adequacy of the disclosures made in the financial statements.
Consolidated statement of profit or loss
2023 2022
€ €
Continuing operations
Operating expenses (604,891) (832,340)
Movement in fair value of warrants 257,050 585,954
Share-based payment expense - -
Operating loss (347,841) (246,386)
Finance income – interest 3 41
Interest expense (14,991) (10,139)
Net finance cost (14,988) (10,098)
Loss before taxation (362,829) (256,484)
Income tax expense - -
Loss for the financial year (362,829) (256,484)
Loss per share
Basic loss per share (0.0083) (0.0065)
Diluted loss per share (0.0083) (0.0065)
The total loss for the financial year is entirely attributable to equity
holders of the Company.
Consolidated statement of financial position
as at 31 May 2023
2023 2022
€ €
Loss for the financial year (362,829) (256,484)
Income recognised in other comprehensive income - -
Total comprehensive loss for the financial year (362,829) (256,484)
Loss for the financial year attributable to:
Equity holders of the Company (362,829) (256,484)
Total comprehensive loss for the financial year attributable to:
Equity holders of the Company (362,829) (256,484)
Consolidated statement of financial position
as at 31 May 2023
31 May 2023 31 May 2022
€ €
Assets
Non-current assets
Intangible assets 26,331,917 23,888,833
Property, plant and equipment 91,703 7,589
Financial assets 273,491 -
Total non-current assets 26,697,111 23,896,422
Current assets
Cash and cash equivalents 557,934 1,216,097
Other receivables 124,828 429,329
Total current assets 682,762 1,645,426
Total assets 27,379,873 25,541,848
Equity
Capital and reserves
Share capital presented as equity 10,549,187 10,543,694
Share premium 15,698,805 15,256,556
Capital conversion reserve fund 30,617 30,617
Share-based payments reserve 42,664 42,664
Other reserve 71,596 79,929
Retained deficit (6,585,551) (6,222,722)
Total equity 19,807,318 19,730,738
Non-controlling interests
Convertible shares in subsidiary companies 3,707,218 1,406,899
Total non-controlling interests 3,707,218 1,406,899
Liabilities
Non-current liabilities
Convertible loans - 388,219
Leases due > 1 year 21,100 -
Warrant liabilities - 257,050
Total non-current liabilities 21,100 645,269
Current liabilities
Trade and other payables 3,707,238 3,621,943
Related party loans 136,999 136,999
Total current liabilities 3,844,237 3,758,942
Total liabilities 3,865,337 4,404,211
Attributable to equity holders of the Company 27,379,873 25,541,848
Total equity, non-controlling interests and liabilities 27,379,873 25,541,848
The financial statements were approved by the Board of Directors on 27
November 2023 and authorised for issue on 29 November 2023.
Consolidated statement of changes in equity
for the financial year ended 31 May 2023
Share capital Share premium Capital conversion reserve fund Share-based payment reserve Other reserve Retained deficit Total equity
€ € € € € € €
Balance at 1 June 2022 10,543,694 15,256,556 30,617 42,664 79,929 (6,222,722) 19,730,738
Share issue 5,493 442,249 - - (8,333) - 439,409
Loss for the financial year - - - - - (362,829) (362,829)
Balance at 31 May 2023 10,549,187 15,698,805 30,617 42,664 71,596 (6,585,551) 19,807,318
Share capital Share premium Capital conversion reserve fund Share-based payment reserve Other reserve Retained deficit Total equity
€ € € € € € €
Balance at 1 June 2021 10,543,694 15,256,556 30,617 42,664 79,929 (5,966,238) 19,987,222
Loss for the financial year - - - - - (256,484) (256,484)
Balance at 31 May 2022 10,543,694 15,256,556 30,617 42,664 79,929 (6,222,722) 19,730,738
Consolidated statement of cash flows
for the financial year ended 31 May 2023
2023 2022
€ €
Cash flows from operating activities
Loss for the financial year (362,829) (256,484)
Adjustments for non-cash items:
Movement in fair value of warrants (257,050) (585,954)
Interest expense 14,991 10,139
Depreciation 18,095 1,885
(586,793) (830,414)
Payments from Karelian Diamond Resources P.L.C. - 70,000
Decrease/(increase) in receivables 31,009 (40,560)
Increase/ (decrease) in payables 142,594 (3,255)
Net cash used in operating activities (413,190) (804,229)
Cash flows from investing activities
Expenditure on intangible assets (2,443,083) (899,859)
Purchase of property, plant and equipment (102,209) -
Net Cash used in investing activities (2,545,292) (899,859)
Cash flows from financing activities
Convertible shares in subsidiary companies 2,300,319 1,406,899
Net cash provided by financing activities 2,300,319 1,406,899
(Decrease)/ increase in cash and cash equivalents (658,163) (297,189)
Cash and cash equivalents at beginning of financial year 1,216,097 1,513,286
Cash and cash equivalents at end of financial year 557,934 1,216,097
1 Accounting policies
Reporting entity
Conroy Gold and Natural Resources P.L.C. (the “Company”) is a company
domiciled in Ireland. The consolidated financial statements of the Company for
the financial year ended 31 May 2023 comprise the financial statements of the
Company and its subsidiaries (together referred to as the “Group”). The
Company is a public limited company incorporated in Ireland under registration
number 232059. The registered office is located at 3300 Lake Drive, Citywest
Business Campus, Dublin 24, D24 TD21, Ireland.
The Company is a mineral exploration and development company whose objective
is to discover and develop world class ore bodies in order to create value for
its shareholders
Basis of preparation
The consolidated financial statements are presented in euro (“€”). The
€ is the functional currency of the Company. The consolidated financial
statements are prepared under the historical cost basis except for derivative
financial instruments, where applicable, which are measured at fair value at
each reporting date.
The preparation of consolidated financial statements requires the Board of
Directors and management to use judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets,
liabilities, income and expenses. Actual results may differ from those
estimates. Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the period in which
the estimate is revised and in any future periods affected. Details of
critical judgements are disclosed in the accounting policies. The consolidated
financial statements were authorised for issue by the Board of Directors on 29
November 2023.
Statement of compliance
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (“IFRS”) as adopted by the
European Union (“EU”) and the requirements of the Companies Act 2014. The
Company’s financial statements have been prepared in accordance with
Financial Reporting Standard 101: Reduced Disclosure Framework (“FRS101”)
and the requirements of the Companies Act 2014.
Basis of consolidation
The consolidated financial statements include the financial statements of
Conroy Gold and Natural Resources P.L.C. and its subsidiaries. Subsidiaries
are entities controlled by the Company. Control exists when the Group is
exposed to or has the right to variable returns from its involvement with the
entity and has the ability to affect those returns through its control over
the entity. In assessing control, potential voting rights that presently are
exercisable are taken into account. The financial statements of subsidiaries
are included in the consolidated financial statements from the date that
control commences until the date that control ceases. Intra-Group balances,
and any unrealised income and expenses arising from intra-Group transactions
are eliminated in preparing the consolidated financial statements. The Company
recognises investment in subsidiaries at cost less impairment.
Going Concern
The Group recorded a loss of €362,829 (31 May 2022: €256,484) and the
Company recorded a loss of €357,617 (31 May 2022: €256,484) for the
financial year ended 31 May 2023. The Group had net assets of €19,807,318
(31 May 2022: €19,730,738) and the Company had net assets of €19,812,530
(31 May 2022: €19,730,738) at that date. The Group had net current
liabilities of €3,161,475 (31 May 2022: €2,113,516) and the Company had
net current liabilities of €2,777,541 (31 May 2022: €1,476,293) at that
date. The Group had cash and cash equivalents of €557,934 at 31 May 2023 (31
May 2022: €1,216,097). The Company had cash and cash equivalents of
€53,136 at 31 May 2023 (31 May 2022: €964,997).
The Directors, namely Professor Richard Conroy, Maureen T.A. Jones, Professor
Garth Earls, Brendan McMorrow, Howard Bird and former Directors, namely,
James P. Jones, Séamus P. Fitzpatrick and Dr. Sorċa Conroy have confirmed
that they will not seek repayment of amounts owed to them by the Group and the
Company of €3,046,692 (31 May 2022: €3,069,148) which are included in net
current liabilities, within 12 months of the date of approval of the financial
statements, unless the Group has sufficient funds to repay.
Since the Joint Venture Agreement with Demir Export was completed, an initial
payment of €1 million was made to the Company and in excess of a further
€3.5 million has been advanced by Demir Export to date funding the ongoing
drilling programme under the Joint Venture Agreement. In excess of 7,000
metres have been drilled to date, with more work planned for 2024.
The Board of Directors have considered carefully the financial position of the
Group and the Company and in that context, have prepared and reviewed cash
flow forecasts for the period until 30 November 2024. The Directors have fully
considered both current and future capital expenditure commitments and the
options to fund such commitments in the twelve month period to November 2024.
The Directors recognise that the Group’s net current liabilities of
€3,161,475 (31 May 2022: €2,113,516) is a material uncertainty that may
cast significant doubt on the Group and the Company’s ability to continue as
a going concern and, therefore, that it may be unable to realise its assets
and discharge its liabilities in the normal course of business. In reviewing
the proposed work programme for exploration and evaluation of assets, the
results obtained from the exploration programme, the funds raised post year
end, the prospects for raising additional funds as required and the completed
Joint Venture Agreement, the Board of Directors are satisfied that it is
appropriate to prepare the financial statements on a going concern basis. The
consolidated and the Company’s financial statements do not include any
adjustments to the carrying value and classification of assets and liabilities
that would arise if the Group and the Company were unable to continue as going
concern.
Recent accounting pronouncements
(a) New and amended standards adopted by the Group and the Company
The Group and the Company have adopted the following amendments to standards
for the first time for its annual reporting year commencing 1 June 2022:
· IFRS 4 amendments regarding the expiry date of the deferral approach –
Effective date 1 January 2023;
· IAS 8 amendments regarding the definition of accounting estimates –
Effective date 1 January 2023;
· IAS 1 amendments regarding the disclosure of accounting policies -
Effective date 1 January 2023;
· IFRS 17 Insurance contracts – Effective date deferred to 1 January 2023;
· Amendment to IFRS 16 about providing lessees with an extension of one year
to exemption from assessing whether a COVID-19-related rent concession is a
lease modification – Effective date 1 April 2021;
· IFRS 3 amendments updating a reference to the Conceptual Framework –
Effective date 1 January 2022;
· IAS 37 amendments regarding the costs to include when assessing whether a
contract is onerous – Effective date 1 January 2022;
· IFRS 1 amendments resulting from Annual Improvements to IFRS Standards
2018–2020 (subsidiary as a first-time adopter) – Effective date 1 January
2022; and
· IFRS 9 amendments resulting from Annual Improvements to IFRS Standards
2018–2020 (fees in the ‘’10 per cent’’ test for derecognition of
financial liabilities) – Effective date 1 January 2022; Amendments to IAS 12
Income taxes: Deferred tax related to assets and liabilities arising from a
single transaction – Effective date 1 January 2023.
(b) New standards and interpretations not yet adopted by the Group and the
Company
The adoption of the above amendments to standards had no significant impact on
the financial statements of the Group and the Company either due to being not
applicable or immaterial.
Certain new accounting standards and interpretations have been published that
are not mandatory for 31 May 2023 reporting periods and have not been early
adopted by the Group and the Company.
The following new standards and amendments to standards have been issued by
the International Accounting Standards Board but have not yet been endorsed by
the EU, accordingly, none of these standards have been applied in the current
year. The Board of Directors is currently assessing whether these standards
once endorsed by the EU will have any impact on the financial statements of
the Group and the Company.
· Amendments to IFRS 10 and IAS 28: Sale or contribution of assets between
an investor and its associate or joint venture – Postponed indefinitely;
· Amendments to IFRS 16 Leases: Lease liability in a sale and leaseback –
Effective date 1 January 2024; and
· Amendments to IAS 1 Presentation of Financial Statements: Classification
of liabilities as current or non-current and classification of liabilities as
current or non-current – Effective date 1 January 2024.
2 Loss per share
2023 2022
€ €
Loss for the financial year attributable to equity holders of the Company (362,829) (256,484)
Basic loss per share
No. of shares No. of shares
Number of ordinary shares at start of financial year 39,262,880 39,262,880
Number of ordinary shares issued during the financial year 5,493,221 -
Number of ordinary shares at end of financial year 44,756,101 39,262,880
Weighted average number of ordinary shares for the purposes of basic earnings per share 43,671,058 39,262,880
Loss per ordinary share (0.0083) (0.0065)
Diluted loss per share
The effect of share options and warrants is anti-dilutive.
3 Intangible assets
Exploration and evaluation assets
Group: Cost 31 May 2023 31 May 2022
€ €
At 1 June 23,888,833 22,988,974
Expenditure during the financial year
· License and appraisal costs 1,795,401 30,986
· Other operating expenses 647,683 868,873
At 31 May 26,331,917 23,888,833
Company: Cost 31 May 2023 31 May 2022
€ €
At 1 June 3,421,364 22,469,838
Expenditure during the financial year
· License and appraisal costs 68,724 30,986
· Other operating expenses 161,509 523,623
Transfer of intangible assets to subsidiaries - (18,423,344)
Sale of intangible assets to subsidiaries - (1,000,000)
Transfer of current year costs to subsidiaries - (179,739)
At 31 May 3,651,597 3,421,364
Exploration and evaluation assets relate to expenditure incurred in the
development of mineral exploration opportunities. These assets are carried at
historical cost and have been assessed for impairment in particular with
regard to the requirements of IFRS 6: Exploration for and Evaluation of
Mineral Resources relating to remaining licence or claim terms, likelihood of
renewal, likelihood of further expenditure, possible discontinuation of
activities over specific claims and available data which may suggest that the
recoverable value of an exploration and evaluation asset is less than its
carrying amount.
The Irish licenses in relation to Clontibret, Longford Down and Armagh were
transferred to the three new subsidiaries in the prior year. See Note 7. All
prior costs capitalised in line with IFRS 6 as above, in relation to these
three licenses, were transferred to the subsidiaries where the licenses are
now held. Costs incurred in the current year in relation to the licenses held
by the companies either were or will be recharged to the subsidiaries.
The Board of Directors have considered the proposed work programmes for the
underlying mineral resources. They are satisfied that there are no indications
of impairment.
The Board of Directors note that the realisation of the intangible assets is
dependent on further successful development and ultimate production of the
mineral resources and the availability of sufficient finance to bring the
resources to economic maturity and profitability. Please refer to Note 17 for
details of further work commitments.
Mineral interests are categorised as follows:
Group: Ireland Cost 31 May 2023 € 31 May 2022 €
At 1 June 21,086,461 20,506,725
Expenditure during the financial year
· License and appraisal costs 1,794,850 28,752
· Other operating expenses 622,324 550,984
At 31 May 23,503,635 21,086,461
Group: Finland Cost 31 May 2023 € 31 May 2022 €
At 1 June 2,802,372 2,482,249
Expenditure during the financial year
· License and appraisal costs 550 2,234
· Other operating expenses 25,360 317,889
At 31 May 2,828,282 2,802,372
Company: Ireland Cost 31 May 2023 € 31 May 2022 €
At 1 June 618,992 19,987,589
Expenditure during the financial year
· License and appraisal costs 68,174 28,752
· Other operating expenses 136,149 205,734
Transfer of intangible assets to subsidiaries - (18,423,344)
Sale of intangible assets to subsidiaries - (1,000,000)
Transfer of current year costs to subsidiaries - (179,739)
At 31 May 823,315 618,992
Company: Finland Cost 31 May 2023 € 31 May 2022 €
At 1 June 2,802,372 2,482,249
Expenditure during the financial year
· License and appraisal costs 550 2,234
· Other operating expenses 25,360 317,889
At 31 May 2,828,282 2,802,372
4 Cash and cash equivalents
Group 31 May 2023 31 May 2022
€ €
Cash held in bank accounts 557,934 1,216,097
557,934 1,216,097
Company 31 May 2023 31 May 2022
€ €
Cash held in bank accounts 53,136 964,997
53,136 964,997
5 Current liabilities
Trade and other payables
Group 31 May 2023 31 May 2022
€ €
Other creditors and accruals 614,121 552,795
Amounts falling due within one year:
Accrued Directors’ remuneration
Fees and other emoluments 2,464,317 2,368,045
Pension contributions 164,675 164,675
Accrued former Directors’ remuneration
Fees and other emoluments 464,125 507,345
Pension contributions - 29,083
3,707,238 3,621,943
Company 31 May 2023 31 May 2022
€ €
Other creditors and accruals 265,167 433,701
Amounts falling due within one year:
Accrued Directors’ remuneration
Fees and other emoluments 2,464,317 2,368,045
Pension contributions 164,675 164,675
Accrued former Directors’ remuneration
Fees and other emoluments 464,125 507,345
Pension contributions - 29,083
3,358,284 3,502,849
It is the Group’s practice to agree terms of transactions, including payment
terms with suppliers. It is the Group’s policy that payment is made
according to the agreed terms. The carrying value of the trade and other
payables approximates to their fair value.
The Directors, namely Professor Richard Conroy, Maureen T.A. Jones, Professor
Garth Earls, Brendan McMorrow, Howard Bird and former Directors, namely James
P. Jones, Séamus P. Fitzpatrick and Dr. Sorċa Conroy have confirmed that
they will not seek repayment of amounts owed to them by the Group and the
Company of €3,046,692 (31 May 2022: €3,069,148) for a minimum period of 12
months from the date of approval of the consolidated financial statements,
unless the Group has sufficient funds to repay.
Related party loans – Group and Company
Related party loans 31 May 2023 31 May 2022
€ €
Opening balance 1 June 136,999 136,999
Closing balance 31 May 136,999 136,999
The related party loans amounts relate to monies owed to Professor Richard
Conroy amounting to €101,999 (31 May 2022: €101,999) and Séamus P.
Fitzpatrick (former Director) amounting to €35,000 (31 May 2022: €35,000).
The Directors and former Director have confirmed that they will not seek
repayment of the remaining loan balances owed to them by the Group and Company
at 31 May 2023 within 12 months of the date of approval of the consolidated
financial statements, unless the Group has sufficient funds to repay. There is
no interest payable in respect of these loans, no security has been attached
to these loans and there is no repayment or maturity terms. Séamus P.
Fitzpatrick is a former director in the Company having left the board in
August 2017 (and is a shareholder of the Company owning less than 3% of the
issued share capital of the Company).
6 Non-current liabilities
Warrant liabilities
No new warrants were issued in the current year or in the prior year. All
warrants in issue at 31 May 2022 lapsed during the year.
As a result €257,070 was reflected in the financial
statements as a reduction in the fair value of warrants.
Convertible loan
On 15 July 2019, the Company entered into an unsecured convertible loan
agreement for €250,000 with Hard Metal Machine Tools Limited (the
“Lender”). This loan note attracted an interest rate of 5% and was
convertible into ordinary equity at a price of 7 pence sterling per share. A
further unsecured convertible loan note for €100,000 was issued on 30
October 2019 to the Lender and carried a similar interest rate and a
conversion price of 6 pence sterling per share. Both loan notes together
with all accrued interest were converted into a total of 5,417,935 new
ordinary shares in the capital of the company during the year ended 31 May
2023.
31 May 2023 31 May 2022
€ €
Opening Balance 388,219 378,080
Interest payable 14,991 10,139
Converted during the year (403,210) -
- 388,219
7 Non-controlling interests
Convertible shares
Under the terms of the joint venture and related agreements entered into
between the Company and Demir Export on 31 December 2021, in return for
fulfilling funding and other obligations as set out in the agreements, Demir
Export will earn an equity interest in the following wholly owned subsidiaries
of the Company: Conroy Gold (Clontibret) Limited, Conroy Gold (Longford Down)
Limited and Conroy Gold (Armagh) Limited. The investment by Demir Export is
effected by the issuance of convertible shares in each subsidiary company
which have no voting or participation rights.
When all of the conditions (including, inter-alia a minimum of €5.5 million
in cash investment) in relation to the first phase of the joint venture
operation (Phase 1) have been fulfilled, the convertible shares will be
converted into ordinary shares in each subsidiary company such that Demir
Export will hold a 25% ordinary equity interest in each company. Demir Export
can earn further equity in each subsidiary company by meeting the commitments
set down in Phases 2 and 3 of the joint venture.
At 31 May 2023, Demir Export had invested €3,707,218 in the subsidiary
companies with convertible shares issued for the first €2,557,218 of this
investment and the balance to be issued post year end in line with the
agreement. This amount is recorded as a non-controlling interest at the year
end. Post year end this investment has increased to in excess of €4,500,000.
The joint venture agreements provide that in certain limited circumstances,
Demir Export will be entitled to a net smelter royalty in the licences, capped
at the level of investment made, in lieu of their convertible shares should it
exit or terminate its involvement in the joint venture during the current
Phase 1 stage.
31 May 2023 31 May 2022
€ €
Conroy Gold Clontibret Limited 2,577,000 1,206,899
Conroy Gold Longford Down Limited 495,100 100,000
Conroy Gold Armagh Limited 635,118 100,000
3,707,218 1,406,899
8 Commitments and contingencies
Exploration and evaluation activities
The Group has received prospecting licences under the Republic of Ireland
Mineral Development Acts 1940 to 1995 for areas in Monaghan and Cavan. It has
also received licences in Northern Ireland for areas in Armagh in accordance
with the Mineral Development Act (Northern Ireland) 1969.
At 31 May 2023, the Group had work commitments of €98,965 (31 May 2022:
€328,055) for year to 31 May 2024, in respect of these prospecting licences
held. These commitments will be funded by Demir Export A.S., the JV partner on
Longford Down Massif as per the agreed terms of the JV agreement.
The Group also hold prospecting license in Finland which are currently under
application for extending, however there are no work or financial commitments
in respect of these licenses as at 31 May 2023 (31 May 2022: €Nil)
9 Related party transactions
(a) Details as to shareholders and Directors’ loans and share capital
transactions with Professor Richard Conroy, Maureen T.A. Jones, Séamus P.
Fitzpatrick (former Director) and Dr. Sorċa Conroy (former Director) are
outlined in in Note 12 of the consolidated financial statements. The loans do
not incur interest, are not secured and will not be called upon within twelve
months from the date of signing of these consolidated financial statements.
(b) For the financial year ended 31 May 2023, the Company incurred costs
totalling €46,179 (31 May 2022: €100,313) on behalf of Karelian Diamond
Resources P.L.C., which has certain common shareholders and Directors. These
costs were recharged to Karelian Diamond Resources P.L.C. This intercompany
account does not incur interest and no final settlement of the balance has
been agreed. Both entities will continue to incur and share costs as with
prior years.
These costs are analysed as follows:
2023 2022
€ €
Office salaries 25,558 72,469
Rent and rates 10,146 15,850
Other operating expenses 10,475 11,994
46,179 100,313
(c) At 31 May 2023 the company recorded a receivable of €5,023 from
Karelian Diamond Resources P.L.C. (31 May 2022: €199,806). Amounts owed by
Karelian Diamond Resources P.L.C. are included within trade and other
receivables during the current year. During the financial year ended 31 May
2023, the Company paid €32,500 to (31 May 2022: €70,000 received from)
Karelian Diamond Resources P.L.C.
(d) During the financial year ended 31 May 2023, the Company charged
€46,179 (31 May 2022: €100,313) to Karelian Diamond Resources P.L.C. in
respect of the allocation of certain costs as detailed in Note 17(b) above.
In May 2023, the Company converted amounts owing to it equivalent to
€143,943 (£125,000) into ordinary equity as detailed in Note 11 and a
further €129,549 (£112,500) into a convertible loan instrument as detailed
in Note 11.
(e) At 31 May 2023, Conroy Gold Limited owed €523,380 (31 May 2022:
€519,133) to the Company.
(f) At 31 May 2023, the Company was owed €13,933 (31 May 2022: €13,933)
by Trans-International Oil Exploration Limited. Professor Richard Conroy and
Maureen T.A. Jones are Directors of Trans-International Oil Exploration
Limited. Professor Richard Conroy holds 50.7% of the share capital of this
company. A further €37,535 (31 May 2022: €35,885) is owed by Conroy
P.L.C., a company in which Professor Richard Conroy has a controlling
interest. Amounts totalling €3,076 (31 May 2022: €3,076) were owed by
companies in which Professor Richard Conroy and Maureen T.A. Jones hold a 50%
interest each. The amounts owed by the various companies are included within
“Other receivables” in the current and previous financial year’s
consolidated statement of financial position and company’s statement of
financial position.
(g) At 31 May 2023, the Company was owed €37,162 (31 May 2022: €107,596)
by Conroy Gold Clontibret Limited, €15,944 (31 May 2022:€ 101,412) by
Conroy Gold Longford-Down Limited and €5,182 (31 May 2022: €Nil) by Conroy
Gold Armagh Limited. These balances relate to administration expenses that are
recharged to the subsidiaries from the Company as per the agreements with the
companies.
(h) Key management personnel are considered to be the Board of Directors and
other key management. The compensation of all key management personnel
during the year was €440,663 (31 May 2022: €400,413). Further analysis
of remuneration for each Director of the Company is set out in note 2.
(i) Professor Garth Earls invoiced the Group for €11,320 (31 May 2022:
€9,785) during the financial year for professional services rendered to the
Group. At 31 May 2023, Professor Garth Earls was owed €37,426 (31 May 2022:
€33,331) in respect of these services and services to the company as
director. Brendan McMorrow invoiced the Group for €23,750 (31 May 2022:
€14,725) during the financial year for professional services rendered to the
Group. At 31 May 2023, Brendan McMorrow was owed €29,961 (31 May 2022:
€26,189) in respect of these services and services to the company as
director.
(j) During the year the Company converted two unsecured Convertible Loan Notes
held by Hard Metal Machine Tools Limited (the "Lender") into ordinary shares
in the company as detailed in Note 14. The Lender is a company 99% owned by
Phillip Hannigan, a substantial shareholder in the Company.
10 Post balance sheet events
Post year end, the Company announced on 20th June that it had completed a
fundraising of £400,000 through the issue of 2,962,962 ordinary shares in
order to increase the company’s exploration capacity and strengthen its
working capital position. Each share carries a warrant to subscribe for one
new Ordinary Share at a price of 22.5 pence per Ordinary Share exercisable at
any point up to 13 June 2026.
In announcements on 5th June 2023, 13th July 2023, 4th September 2023, 13th
September 2023 and 22nd November 2023 the Company announced detail of results
and progress from the exploration programme being carried out in conjunction
with the Company’s joint venture partner Demir Export AS.
There were no further material events after the reporting year requiring
adjustment to or disclosure in these audited consolidated and company’s
financial statements.
11 Approval of the audited consolidated financial statements for the
financial year ended 31 May 2023
These audited consolidated financial statements were approved by the Board
of Directors on 27 November 2023 and authorised for issue on 29 November 2023.
A copy of the audited consolidated financial statements will be available on
the Company’s website www.conroygold.com and will be available from the
Company’s registered office at 3300 Lake Drive, Citywest Business Campus,
Dublin 24, D24 TD21, Ireland.
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