REG-Conroy Gold & Natural Resources Plc: Final Results
11/12/2021 19:15
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR"). With the publication of this announcement via a
Regulatory Information Service, this inside information is now considered to
be in the public domain.
30 November 2021
Conroy Gold and Natural Resources plc
(“Conroy Gold” or “the Company”)
FINAL RESULTS FOR THE YEAR TO 31 MAY 2021
NOTICE OF ANNUAL GENERAL MEETING
Conroy Gold and Natural Resources plc (AIM: CGNR), the gold exploration and
development company focused on Ireland and Finland, is pleased to report its
audited accounts for the year to 31 May 2021.
Highlights:
* Definitive agreements with Demir Export are now at an advanced stage and an
EGM is expected to be held in late December to seek shareholder approval for
the proposed joint venture
* The joint venture partnership aim is to bring in a gold mine at Clontibret
and to further explore and develop the 65 km district scale gold trend that
the Company has discovered
* Excellent exploration results achieved, including new gold discoveries in
the Glenish licence area and, Post Period, in Co. Armagh
* Licence area held by the Company also has a high base metal metalliferous
content, including antimony and zinc
* Significant additional funds raised in the period
Chairman, Professor Richard Conroy commented:
“Definitive agreements with Demir Export are now at an advanced stage and an
EGM is expected to be convened shortly to seek shareholder approval for the
proposed joint venture. We are now entering a new era and my colleagues and I
look forward very much to working with the Demir Export team on the joint
venture partnership - Project Inis – once the agreements are concluded and
building the foundation for a long term, successful relationship.
“We look forward to developing our first gold mine.”
Annual Report and Accounts for the year to 31 May 2021
The full audited annual report and accounts for the year to 31 May 2021
(“Annual Report”) will be posted to shareholders today and will be
published on the Company’s website (www.conroygoldandnaturalresources.com)
today. 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 Alex
Hotel, 41-47 Fenian St, Dublin, D02 H678 at 1pm on 22 December 2021. 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 Tel: +353-1-479-6180
Professor Richard Conroy, Chairman
Allenby Capital Limited (Nomad) Tel: +44-20-3328-5656
Nick Athanas/Nick Harriss
First Equity Limited (Broker) Tel: +44-20-7330-1883
Jason Robertson
Lothbury Financial Services Tel: +44-20-3290-0707
Michael Padley
Hall Communications Tel : +353-1-660-9377
Don Hall
Visit the Company website at www.conroygold.com
Key Information Extracted from Annual Report
Chairman’s Statement
Dear Shareholder,
Excellent progress in the Company’s affairs has been made during the course
of the year. A Letter of Intent (“LOI”) was signed in February 2021
between Demir Export SA (“Demir Export”) and Conroy Gold for the formation
of a joint venture partnership on an earn-in basis to bring in a gold mine and
to further explore and develop the 65 km (40 mile) district scale gold trend
which Conroy Gold and Natural Resources has discovered in the Longford-Down
Massif in Ireland. The Company and Demir Export have now progressed to the
stage of having terms agreed on a definitive agreement. During the year there
were further excellent exploration results including new gold discoveries.
Also, during the year, an Extraordinary General Meeting (“EGM”) was held
and the necessary resolutions passed, to ensure that, post Brexit, the
Company’s shares would continue to be able to be settled electronically on
AIM. There were also successful financings totalling over €3.6 million.
Joint Venture Project (“Project Inis”)
The Board considered that the approach by Demir Export and the terms which
they offered provided an excellent basis for a long-term relationship under
which to develop the gold trend in the Longford – Down Massif which the
Company has discovered. The Board decided, therefore, to sign an LOI with
Demir Export and end discussions with Anglo Asian Mining plc. Definitive
agreements with Demir Export are now at an advanced stage and an EGM will be
held in late December to seek shareholder approval for the proposed joint
venture.
The primary focus of the joint venture project (the “Demir Export JV” or
“Project Inis”) is the development of the gold deposit in the Clontibret
licence to construction ready status and bringing it into operation as a gold
mine. The parties further aim is to have the other licences given the same
status one after the other, hence providing a foundation for a long-term
relationship between the parties.
Demir Export is a long-established mining company with interests in iron,
coal, gold and base metals, including zinc and copper in Turkey and has a
strong in-house technical team with mining and exploration expertise. It
brings over 60 years of mine operating experience to bear on the project and
places a strong emphasis on the adoption of international environmental,
health and safety management standards.
Investment by Demir Export will be directly into special purpose companies
holding each licence or group of licences. Demir Export will make a cash
payment of €1 million to the Company upon final approval of the definitive
agreement in recognition of prior work carried out in relation to the
project.
The Earn-in Period will be divided into three phases:
Phase 1: expenditure by Demir Export in work commitments (except Demir Export
in-house costs, Operator fees and Minimum Regulatory Work Commitments) of
€4.5 million will earn a 25% interest in the project.
Phase 2: expenditure by Demir Export in work commitments (except Demir Export
in-house costs, Operator fees and Minimum Regulatory Work Commitments) of
€4.5 million will earn an additional 15%.
Phase 3: expenditure by Demir Export of the additional funds required to reach
declaration of construction ready status (i.e. a bankable feasibility study or
equivalent) - for Clontibret and/or other mine developments will earn an
additional 17.5% interest, thus increasing Demir Export’s holding to a total
of 57.5% in the development(s).
Conroy Gold, after construction ready status is achieved, may either retain
its 42.5% interest in Clontibret and/or other mine developments by
participating pro rata in the expenditures for mine construction, or avail
itself of a number of options including diluting its interest or being carried
for the expenditures through to commercial production with a “Carry Loan”
for a 25% interest with pay back of 50% or greater portion of the net profits
due to Conroy Gold within a maximum payback period of six years.
The licences in the Demir Export JV will be divided into three Licence Groups,
namely the Clontibret Licence, the two Northern Ireland Licences, and the
remaining nine licences in the Republic of Ireland, with separate jointly
owned companies, the Joint Venture Companies, owning the Licence or Licence
Groups.
A Joint Management Committee (the “JMC”) will be set up to oversee, plan
and execute the various plans in the work programme of Demir Export JV. The
JMC will be comprised of four members, two from each party, with a Demir
Export representative having a casting vote, with appropriate minority
protection rights. It is anticipated that Conroy Gold will be appointed as
operator for an initial two year period after which the matter of operatorship
will be reviewed.
The Joint Venture remains subject to, inter alia, the entering into of
definitive documentation including a joint venture framework agreement and
shareholders agreement. The proposed joint venture will be subject to the
Company seeking shareholder approval as it would be classified as a
fundamental change of business pursuant to Rule 15 of the AIM Rules for
Companies. An EGM is being convened for 22 December 2021 to seek shareholder
approval. For the avoidance of doubt, Conroy Gold would, on completion,
continue to be classified as an operating company and not a cash shell
pursuant to AIM Rule 15. Furthermore, completion of the joint venture
agreement is also conditional on the necessary regulatory consents being
granted in the Republic of Ireland and Northern Ireland for the transfer of
the licences to the respective joint venture companies.
The Company’s eight gold exploration licences in Finland and one other
licence owned by the Company in Ireland are not subject to the joint venture
and will remain 100% owned by the Company. Demir Export has been granted a
right refusal over these licences until 31 December 2023.
Exploration Results
During the year excellent results were achieved from the Company’s
exploration programme in the Longford-Down Massif in Ireland over the new
district scale gold trend which the Company has discovered. The results
included new gold discoveries in the Glenish licence. This licence lies
southwest of the Clontibret area where the Company is looking to develop its
first gold mine and is along the trend. Post year end, an extensive new gold
target, in the Company’s C1 licence area in Co. Armagh in Northern Ireland
was also discovered. This discovery lies between the Company’s Clay
Lake-Derryhennet gold discovery and the location of the discovery of the
famous Clay Lake Nugget (now in the Ulster Museum). Also, during the year,
high value zinc assays were reported from an infill soil sampling programme.
As well as the extensive gold trend which the Company has discovered, the
Longford-Down Massif has an established history of base metal mining,
including the historic antimony mines in Clontibret, in the back channels of
which the first gold discoveries were made. There were also a number of lead
and zinc mines which were worked in the nineteenth century, forming an area
which was known as the Armagh-Monaghan Mining District. The entire licence
area held by the Company has a high base metal metalliferous content
including, in particular, antimony, which ranks highly as an EU essential
metal, and although gold is the Company’s primary target, additional
potential in other metals is a welcome bonus.
COVID-19
The Company has taken necessary measures in accordance with government
guidelines to protect the health, safety and wellbeing of its employees,
contractors and partners in Ireland and Finland. COVID-19 continues to limit
field and laboratory work, but, despite this, progress has continued in
relation to the Company’s exploration and development programme. In relation
to COVID-19, Directors and executives took a reduction in salaries and fees in
line with technical and field staff taking a reduction in salaries over a 6
month period.
Environmental, Social, and Governance Issues
Great emphasis is placed by the Company on Environmental, Social, and
Governance issues. The Company is committed to high standards of corporate
governance and integrity in all of its activities and operations including
rigorous health and safety compliance and environmental consciousness and
promotes 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.
It is a requirement that the Chairman of the Board regularly monitors and
reviews the Company’s ethical standards and cultural environment and where
necessary take appropriate action to ensure proper standards are maintained.
The Company is fully committed to complying with all relevant health, safety
and environment rules and regulations as these apply to its operations and all
individuals working for the Company are aware of their responsibilities in
providing a safe and secure working environment.
Extraordinary General Meeting and Migration to Euroclear
An extraordinary general meeting (“EGM”) was held on 17 February 2021 to
maintain electronic trading in the Company’s shares post Brexit. The
settlement system relating to the Company’s shares needed, as a consequence
of Brexit, to move from Crest in London to Euroclear Bank in Belgium
(“Migration”). Resolutions were duly passed at the EGM enabling the
Company’s shares to continue to be settled electronically on the AIM market
in London. This will be the Company’s first AGM since migration of the
holding and settlement of uncertificated shares in the Company from CREST to
the Euroclear Bank system. The processes and timelines for submitting proxy
appointments or voting instructions for the AGM will differ from the
comparable processes and timelines that applied in CREST for previous
shareholder meetings. Additional explanatory information is included in the
notice of meeting, and it will be important for relevant shareholders to
confirm the procedures with their stockholder, custodian, or other
intermediary as they may vary depending on the specific arrangements that are
in place for individual shareholders.
Financials
The profit after taxation from continuing operations for the financial year
ended 31 May 2021 was €211,010 (2020: loss of €677,380). The main reason
for the profit after taxation was a favourable movement in the fair value of
the various warrants issued during the year amounting to €1,055,490.
During the year, the Company raised €3,643,044 (£3,191,333) by way of
equity placings and exercise of warrants and also converted €440,408
(£378,751) of debt to equity.
At 31 May 2021 the Group had cash reserves of €1,513,286 (2020: €117,270)
and net assets of €19,987,222 (2020: €17,645,315).
Directors and Staff
I would like to express my deep appreciation of the support and dedication of
the Directors, staff, and consultants which has made possible the continued
progress and success which the Company has achieved.
Professor Richard Conroy
Chairman
30 November 2021
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 your attention to Note 1 in the financial statements, which indicates
that the group and parent company recorded a profit in the current financial
year of €211,010 during the year ended 31 May 2021 and, as of that date, the
group and parent Company had net current liabilities of €1,790,142 and
€1,271,009 respectively at that date.
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:
* Obtained an understanding of the group’s and company’s 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, assessed the design and determined the implementation of these
controls;
* Evaluated directors’ plans and their feasibility by testing the key
assumptions used in the cash flow forecast provided by agreeing the inputs to
historical run rates, expenditure commitments and other supporting
documentation;
* Obtained an understanding of directors’ plans to enable the group and
parent company to obtain and/or raise the funds required to meet the
expenditure commitments of the group and parent company;
* Inspected confirmations received by the group and parent company from the
Directors and former Directors 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 company
has sufficient funds to repay;
* Inspected the confirmation received from Karelian Diamond Resources Plc that
it does not intend to seek repayment of amounts owed by the group and parent
company within 12 months of the date of approval of the financial statements,
unless the group and/or parent Company has sufficient funds to repay;
* Assessed the mechanical accuracy of the cash flow forecast model;
* Assessed the adequacy of the disclosures made in the financial statements;
and
* We obtained evidence of the status of negotiations between the group and a
potential joint venture partner, including the expected financial commitments
should negotiations conclude successfully.
As stated in Note 1, these events or conditions along with other matters as
set forth in Note 1 indicate that a material uncertainty exists that may cast
significant doubt on group’s and parent company’s ability to continue as a
going concern. Our opinion is not modified in respect of this matter.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Consolidated Income Statement for the financial year ended 31 May 2021
2021 2020
€ €
Continuing operations
Operating expenses - other (752,619) (563,763)
Operating expenses – Share-based payment expense (71,596) (97,482)
Movement in fair value of warrants 1,055,490 -
Operating profit/(loss) 231,275 (661,245)
Finance income – interest 13 -
Interest expense (20,278) (16,135)
Net finance cost (20,265) (16,135)
Profit/(loss) before taxation 211,010 (677,380)
Income tax expense - -
Profit/(loss) for the financial year 211,010 (677,380)
Earnings/(loss) per share
Basic earnings/(loss) per share 0.0065 (0.0278)
Diluted earnings/(loss) per share 0.0065 (0.0278)
The total profit/(loss) for the financial year is entirely attributable to
equity holders of the Company.
Consolidated statement of comprehensive income for the financial year ended 31
May 2021
2021 2020
€ €
Profit/(loss) for the financial year 211,010 (677,380)
Income recognised in other comprehensive income - -
Total comprehensive profit/(loss) for the financial year 211,010 (677,380)
The total comprehensive profit/(loss) for the financial year is entirely
attributable to equity holders of the Company.
Consolidated statement of financial position as at 31 May 2021
31 May 2021 31 May 2020
€ €
Assets
Non-current assets
Intangible assets 22,988,974 22,330,743
Property, plant and equipment 9,474 10,692
Total non-current assets 22,998,448 22,341,435
Current assets
Cash and cash equivalents 1,513,286 117,270
Other receivables 458,769 89,951
Total current assets 1,972,055 207,221
Total assets 24,970,503 22,548,656
Equity
Capital and reserves
Share capital presented as equity 10,543,694 10,530,645
Share premium 15,256,556 13,084,647
Capital conversion reserve fund 30,617 30,617
Share-based payments reserve 42,664 574,875
Other reserve 79,929 8,333
Retained deficit (5,966,238) (6,583,802)
Total equity 19,987,222 17,645,315
Liabilities
Non-current liabilities
Warrant liabilities 843,004 -
Convertible loans 378,080 357,802
Total non-current liabilities 1,221,084 357,802
Current liabilities
Trade and other payables 3,625,198 3,885,707
Related party loans 136,999 659,832
Total current liabilities 3,762,197 4,545,539
Total liabilities 4,983,281 4,903,341
Total equity and liabilities 24,970,503 22,548,656
The financial statements were approved by the Board of Directors on 30
November 2021 and authorised for issue on 30 November 2021.
Consolidated statement of changes in equity for the financial year ended 31
May 2021
Share capital Share premium Capital conversion reserve fund Share-based payment reserve Other reserve Retained deficit Total equity
€ € € € € € €
Balance at 1 June 2020 10,530,645 13,084,647 30,617 574,875 8,333 (6,583,802) 17,645,315
Share issue (see Note 14) 13,049 4,070,403 - - - - 4,083,452
Share issue costs - - - - - (125,657) (125,657)
Warrant issue - (1,898,494) - - - - (1,898,494)
Warrant exercise - - - - 71,596 - 71,596
Transfer from share-based payment reserve to retained deficit - - - (532,211) - 532,211 -
Profit for the financial year - - - - - 211,010 211,010
Balance at 31 May 2021 10,543,694 15,256,556 30,617 42,664 79,929 (5,966,238) 19,987,222
Share capital Share premium Capital conversion reserve fund Share-based payment reserve Other reserve Retained deficit Total equity
€ € € € € € €
Balance at 1 June 2019 10,528,124 12,727,194 30,617 751,293 - (6,163,902) 17,873,326
Share issue (see Note 14) 2,521 357,453 - - - - 359,974
Share issue costs - - - - - (16,420) (16,420)
Share based payments - - - 97,482 - - 97,482
Conversion feature (convertible loans) - - - - 8,333 - 8,333
Transfer from share-based payment reserve to retained deficit - - - (273,900) - 273,900 -
Loss for the financial year - - - - - (677,380) (677,380)
Balance at 31 May 2020 10,530,645 13,084,647 30,617 574,875 8,333 (6,583,802) 17,645,315
Consolidated statement of cash flows for the financial year ended 31 May 2021
2021 2020
€ €
Cash flows from operating activities
Profit/(loss) for the financial year 211,010 (677,380)
Adjustments for:
Depreciation 1,885 1,884
Share-based payment 71,596 97,482
Movement in fair value of warrants (1,055,490) -
Interest expense 20,278 16,135
(750,721) (561,879)
(Decrease)/increase in payables (32,105) 339,762
(Increase)/decrease in receivables (368,821) 16,233
(Payments to)/advances from Karelian Diamond Resources P.L.C. (228,402) 4,228
Net cash used in operating activities (1,380,049) (201,656)
Cash flows from investing activities
Expenditure on intangible assets (658,230) (558,698)
Purchase of property, plant and equipment (667) (1,229)
Cash used in investing activities (658,897) (559,927)
Cash flows from financing activities
Issue of share capital 3,643,044 359,974
Share issue costs (125,657) (16,420)
(Payments to)/advances from related parties (82,425) 108,000
Proceeds from convertible loans issue - 350,000
Net cash provided by financing activities 3,434,962 801,554
Increase in cash and cash equivalents 1,396,016 39,971
Cash and cash equivalents at beginning of financial year 117,270 77,299
Cash and cash equivalents at end of financial year 1,513,286 117,270
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 2021 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.
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 30
November 2021.
Going Concern
The Group and the Company recorded a profit of €211,010 (2020: a loss of
€677,380) for the financial year ended 31 May 2021. The Group and the
Company had net assets of €19,987,222 (2020: €17,645,315) at that date.
The Group had net current liabilities of €1,790,142 (2020: €4,338,318) and
the Company had net current liabilities of €1,271,009 (2020: €3,981,673)
at that date. The Group and the Company had cash and cash equivalents of
€1,513,286 at 31 May 2021 (2020: €117,270). 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, C. David Wathen, Louis J. Maguire, Dr. Sor?a Conroy and
Michael E. Power, have confirmed that they will not seek repayment of amounts
owed to them by the Group and the Company of €3,119,148 (2020: €3,210,452)
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.
On 1 September 2021, the Company announced that the definitive agreements for
the proposed joint venture with Demir Export A.S., on an earn-in basis, over
the licences held by Conroy Gold along its 65km district scale gold trend in
the Longford-Down Massif in Ireland had reached an advanced stage. The primary
focus of the joint venture project is the development of the gold deposit
within the Clontibret licence to construction ready status and bringing it
into operation as a gold mine.
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 2022. 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 2022.
The Directors recognise that the Group’s net current liabilities of
€1,790,142 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 prospects for raising additional funds as
required and the planned entering into a joint venture with Demir Export, 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
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.
Recent accounting pronouncements
The Group and the Company have adopted the following amendments to standards
for the first time for its annual reporting year commencing 1 June 2020:
* Amendments to references to the Conceptual Framework in IFRS Standards –
Effective date 1 January 2020;
* Amendments to IFRS 3 Business Combinations – Definition of a Business –
Effective date 1 January 2020;
* Amendments to IFRS 9, IAS 39 and IFRS 7 – Interest Rate Benchmark Reform
– Effective date 1 January 2020;
* Amendment to IFRS 16 about providing lessees with an exemption from
assessing whether a COVID-19-related rent concession is a lease modification
– Effective date 1 June 2020; and
* Amendments to IAS 1 and IAS 8 regarding definition of material used in the
Conceptual Framework – Effective date 1 January 2020.
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 2021 reporting periods and have not been early
adopted by the Group and the Company.
The following amendments to standards adopted and endorsed by the EU have been
issued by the International Accounting Standards Board to date and are not yet
effective for the financial year from 1 June 2020. The Board of Directors is
currently assessing whether these standards once adopted by the Group and the
Company will have any impact on the financial statements of the Group and the
Company.
* Amendments to IFRS 4, IFRS 7, IFRS 9, IFRS 16, and IAS 39 regarding
replacement issues in the context of the IBOR reform – Phase 2 - Effective
date 1 January 2021; and
* IFRS 4 amendments regarding the expiry date of the deferral approach –
Effective date 1 January 2023.
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;
* IFRS 1 amendments resulting from Annual Improvements to IFRS Standards
2018–2020 (subsidiary as a first-time adopter) – Effective date 1 January
2022;
* IFRS 3 amendments updating a reference to the Conceptual Framework –
Effective date 1 January 2022;
* 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;
* 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 17 Insurance contracts – Effective date deferred to 1 January 2023;
* IAS 1 amendments regarding the classification of liabilities - Effective
date 1 January 2023;
* IAS 1 amendments regarding the disclosure of accounting policies -
Effective date 1 January 2023;
* IAS 8 amendments regarding the definition of accounting estimates –
Effective date 1 January 2023;
* Amendments to IAS 12 Income taxes: Deferred tax related to assets and
liabilities arising from a single transaction – Effective date 1 January
2023;
* IAS 16 amendments prohibiting a company from deducting from the cost of
property, plant and equipment amounts received from selling items produced
while the company is preparing the asset for its intended use – Effective
date 1 January 2022; and
* IAS 37 amendments regarding the costs to include when assessing whether a
contract is onerous – Effective date 1 January 2022.
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.
2. Loss per share
2021 2020
€ €
Earnings/(loss) for the financial year attributable to equity holders of the Company 211,010 (677,380)
Basic earnings per share
No. of shares No. of shares
Number of ordinary shares at start of financial year 26,213,872 23,693,039
Number of ordinary shares issued during the financial year 13,049,008 2,520,833
Number of ordinary shares at end of financial year 39,262,880 26,213,872
Weighted average number of ordinary shares for the purposes of basic earnings per share 32,257,188 24,404,398
Basic earnings/(loss) per ordinary share 0.0065 (0.0278)
Diluted earnings/(loss) per share
Weighted average number of diluted ordinary shares for the purposes of diluted loss per share 32,257,188 24,404,398
Diluted profit/(loss) per ordinary share 0.0065 (0.0278)
As at 31 May 2021, Nil options and 10,793,116 warrants (2020: Nil options and
3,424,109 warrants), were excluded from the computation of the diluted
earnings/(loss) per share as their strike price was greater than the average
share price in the respective years.
3. Intangible assets
Exploration and evaluation assets
Group: Cost 31 May 2021 31 May 2020
€ €
At 1 June 22,330,743 21,772,045
Expenditure during the financial year
* License and appraisal costs 299,113 189,591
* Other operating expenses (Note 2) 359,118 369,107
At 31 May 22,988,974 22,330,743
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 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 15 for
details of further work commitments.
Mineral interests are categorised as follows:
Group: Ireland Cost 31 May 2021 € 31 May 2020 €
At 1 June 19,920,213 19,426,207
Expenditure during the financial year
* License and appraisal costs 281,261 180,265
* Other operating expenses 305,251 313,741
At 31 May 20,506,725 19,920,213
Group: Finland Cost 31 May 2021 € 31 May 2020 €
At 1 June 2,410,530 2,345,838
Expenditure during the financial year
* License and appraisal costs 17,851 9,326
* Other operating expenses 53,868 55,366
At 31 May 2,482,249 2,410,530
4. Cash and cash equivalents
Group and Company 31 May 2021 31 May 2020
€ €
Cash held in bank accounts 1,513,286 117,270
1,513,286 117,270
5. Current liabilities
Trade and other payables
Group and Company 31 May 2021 31 May 2020
Amounts falling due within one year € €
Accrued Directors’ remuneration
Fees and other emoluments 2,368,045 2,324,218
Pension contributions 164,675 164,675
Accrued former Directors’ remuneration
Fees and other emoluments 507,345 642,476
Pension contributions 79,083 79,083
Other creditors and accruals 506,050 616,786
Amounts owed to Karelian Diamond Resources P.L.C. - 58,469
3,625,198 3,885,707
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, C. David Wathen, Louis J. Maguire, Dr. Sor?a
Conroy and Michael E. Power, have confirmed that they will not seek repayment
of amounts owed to them by the Group and the Company of €3,119,148 (2020:
€3,210,452) 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 2021 31 May 2020
€ €
Opening balance 1 June 659,832 551,832
Loan advance - 108,000
Loan conversion to equity (440,408) -
Loan repayments (82,425) -
Closing balance 31 May 136,999 659,832
The related party loans amounts relate to monies owed to Professor Richard
Conroy amounting to €101,999 (2020: €315,918), Maureen T.A. Jones
amounting to €Nil (2020: €49,425), Séamus P. Fitzpatrick (former
Director) amounting to €35,000 (2020: €69,489) and Dr. Sor?a Conroy
(former Director) amounting to €Nil (2020: €225,000). A repayment was made
to Maureen T.A. Jones and Professor Richard Conroy during the year of
€49,425 and €33,000 respectively. As part of the share issuance on 16
March 2021, the following amounts were converted to equity from the respective
Directors’ loans in exchange for a total of 1,147,726 shares in the Company;
€225,000 was converted on the loan of Dr. Sor?a Conroy, €180,919 was
converted on the loan of Professor Richard Conroy and €34,489 was converted
on the loan of Séamus P. Fitzpatrick. The Directors and former Directors have
confirmed that they will not seek repayment of the remaining loan balances
owed to them by the Group and Company at 31 May 2021 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
During the year ended 31 May 2021, 11,005,065 warrants were issued with a
sterling exercise price and a range of expiry times from six to twenty-four
months. The fair value at grant date amounted to €1,921,971 and was recorded
as warrant liabilities with a corresponding charge to share premium for those
warrants issued as part of the share issuance. At 31 May 2021, the warrants in
issue were again fair valued resulting in a movement in fair value of
€1,055,490 being recorded in the income statement and as a reduction in
warrant liabilities.
Convertible loan notes
During the year ended 31 May 2020, the Company raised €350,000 through the
issue of two unsecured convertible loan notes (“Convertible Loan Notes”)
to Hard Metal Machine Tools Limited (the “Lender”). Both Convertible Loan
Notes have a term of three years and attract interest at a rate of 5% per
annum which is payable on the redemption or conversion of the Convertible Loan
Notes. The Convertible Loan Notes are unsecured. The first Convertible Loan
Note has a monetary amount of €250,000 and was issued on 15 July 2019. This
Convertible Loan Note, including the total amount of accrued but unpaid
interest, is convertible at the conversion price of £0.07 at any time. The
second Convertible Loan Note has a monetary amount of €100,000 and was
issued on 30 October 2019. This Convertible Loan Note, including the total
amount of accrued but unpaid interest, is convertible at the conversion price
of £0.06 at any time. The convertible loans amount to €378,080 (2020:
€357,802) at 31 May 2021.
7. 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 2021, the Group had work commitments of €520,000 (2020:
€388,000) for period to December 2022, in respect of these prospecting
licences held.
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 2021.
8. 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. Sor?a 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 2021, the Company incurred costs
totalling €54,872 (2020: €40,818) 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:
2021 2020
€ €
Office salaries 49,048 80,144
Other operating expenses 5,824 9,851
Rent and rates - (49,177)*
54,872 40,818
*This amount is rechargeable from Karelian Diamond Resources P.L.C.
(c) At 31 May 2021, the Company recorded a receivable of €169,933 from
Karelian Diamond Resources P.L.C. (2020: a payable of €58,469). Amounts from
Karelian Diamond Resources P.L.C. are included within “Trade and other
receivables” in the current financial year statements and were included
within “Trade and other payables in the prior financial year”. During the
financial year ended 31 May 2021, €173,530 was paid to (2020: €45,046 was
received from) Karelian Diamond Resources P.L.C. by the Company. During the
financial year ended the Company charged Karelian Diamond Resources P.L.C.
€54,872 (2020: €40,818) in respect of the allocation of certain costs as
detailed in (b) above. The Group and the Company will not seek repayment of
amounts owed to it by Karelian Diamond Resources P.L.C. within 12 months of
the date of approval of the consolidated financial statements. No interest is
incurred on this intercompany account and there are no other terms or
conditions attached.
(d) At 31 May 2021, Conroy Gold Limited owed €519,133 (2020: Conroy Gold
Limited owed €356,648) to the Company. The movement in the balance relates
to a payment of expenses for an amount of €162,485 incurred in the name of
Conroy Gold Limited by the Company. The Company has confirmed that it will not
seek repayment of amounts owed for a minimum period of 12 months from the date
of approval of the financial statements, unless Conroy Gold Limited has
sufficient funds to repay such amounts. No interest is incurred on this
intercompany account and there are no other terms or conditions attached.
(e) At 31 May 2021, the Company was owed €22,903 (2020: €8,970) 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 €28,961 (2020: €15,866) is owed by Conroy P.L.C., a
company in which Professor Richard Conroy has a controlling interest. Amounts
totalling €5,290 (2020: €5,290) 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.
(f) Details of key management compensation which comprises Directors’
remuneration are outlined below.
An analysis of remuneration for each Director of the Company in the current
financial year (prior to amounts transferred to intangible assets) is as
follows:
Fees € Salary € Total €
Professor Richard Conroy 15,211 136,784 151,995
Maureen T.A. Jones 7,142 86,264 93,406
Professor Garth Earls 7,142 - 7,142
Brendan McMorrow 7,142 - 7,142
Howard Bird 7,142 - 7,142
43,779 223,048 266,827
An analysis of remuneration for each Director of the
Company in the prior financial year (prior to amounts transferred to
intangible assets) is as follows:
Fees € Salary € Total €
Professor Richard Conroy 19,443 153,125 172,568
Maureen T.A. Jones 8,333 96,250 104,583
Professor Garth Earls 8,332 - 8,332
Brendan McMorrow 8,333 - 8,333
44,441 249,375 293,816
(g) Professor Garth Earls invoiced the Group for €24,068 (2020: €29,192)
during the financial year for professional services rendered to the Group. At
31 May 2021, Professor Garth Earls was owed €33,331 (2020: €32,140) in
respect of these services. Brendan McMorrow invoiced the Group for €24,500
(2020: €7,727) during the financial year for professional services rendered
to the Group. At 31 May 2021, Brendan McMorrow was owed €26,189 (2020:
€24,998) in respect of these services.
(h) The Company raised €350,000 through the issue of two unsecured
Convertible Loan Notes to Hard Metal Machine Tools Limited (the “Lender”)
during the year ended 31 May 2020. The Lender is a company 99% owned by an
existing shareholder of the Company. Refer to Note 13 for details of the
interest charged and the conditions attached to the
loans.
9. Post balance sheet events
On 6 July 2021, the Company announced the completion of due diligence drilling
on its Clontibret gold deposit, the completion of a drill hole on the
Cargalisgorran section of the Clay Lake gold target and the commencement of
drilling on other targets in the new district scale gold trend which the
Company has discovered in the Longford-Down Massif in Ireland.
On 29 July 2021, the Company announced the discovery of a new extensive
gold-in-soil anomaly on its licence area in the Longford-Down Massif in
Ireland. The anomaly covers an area of approximately 40 acres.
On 12 August 2021, the Company announced significant gold intersections from
drilling completed in the Cargalisgorran section of its Clay Lake gold target
in the Longford-Down Massif in Ireland.
On 1 September 2021, the Company announced that the definitive agreements for
the proposed joint venture with Demir Export A.S., on an earn-in basis, over
the licences held by Conroy Gold along its 65km district scale gold trend in
the Longford-Down Massif in Ireland had reached an advanced stage. The primary
focus of the joint venture project is the development of the gold deposit
within the Clontibret licence to construction ready status and bringing it
into operation as a gold mine.
COVID-19 continues to limit field and laboratory work given the restrictions
on operations and movement. However, the Company’s exploration and
development programme has nonetheless continued.
There were no other events after the reporting year requiring adjustment to or
disclosure in these audited consolidated and company’s financial statements.
10. Approval of the audited consolidated financial statements for the
financial year ended 31 May 2021
These audited consolidated financial statements were approved
by the Board of Directors on 30 November 2021. A copy of the audited
consolidated financial statements will be available on the Company’s website
www.conroygoldandnaturalresources.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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