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REG - Eurasia Mining PLC - Interim Results for the six months ended 30 June

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RNS Number : 8308M  Eurasia Mining PLC  19 September 2023

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN REGULATION NO.
596/2014 (AS IT FORMS PART OF RETAINED EU LAW AS DEFINED IN THE EUROPEAN UNION
(WITHDRAWAL) ACT 2018) AND IS IN ACCORDANCE WITH THE COMPANY'S OBLIGATIONS
UNDER ARTICLE 7 OF THAT REGULATION.

 

19 September 2023

 

Eurasia Mining plc

 

("Eurasia" or the "Company")

 

Interim Results for the six months ended 30 June 2023

 

Eurasia, the palladium, platinum, rhodium, iridium and gold mining company,
today reports its unaudited interim results and operational summary for the
six months ended 30 June 2023.

A copy of this announcement is also available on Eurasia's website at:

https://www.eurasiamining.co.uk/investors/news-announcements
(https://www.eurasiamining.co.uk/investors/news-announcements)

 

For further information, please contact:

Eurasia Mining Plc

Christian Schaffalitzky/ Keith Byrne

+44 (0)207 932 0418

 

SP Angel Corporate Finance LLP (Nomad and Broker)

Jeff Keating / David Hignell / Adam Cowl

+44 (0)20 3470 0470

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chairman's Statement

Dear Shareholder

The first six months of 2023 saw the Company focused principally on our plan
to sell our Russian assets.

 

Proposed sale of Russian assets

We have concentrated on this effort since 2020 and can report that we continue
to make progress. Our focus on BRICS non-sanctioned counterparties continues,
with several parties currently at various stages of their due diligence.
Although, as stated previously, there is no guarantee of a positive outcome to
this activity, the Board remains focused on achieving a successful conclusion.

 

West Kytlim

Site preparation work was completed during the first quarter of 2023, but due
to the sale process being Eurasia's main priority, no metal concentrate has
been produced at West Kytlim since the end of 2022.

Our key focus at West Kytlim has been on the sale of 2022 concentrate, which
is currently held in inventory, with no restrictions related to its sale as a
precious metals bearing high grade concentrate. The Board expects the
concentrates to be sold at carrying value and we are currently evaluating
offers from three parties who responded to the tender process.

We have started to receive value-added tax refunds (VAT) against capital
expenditure in previous years, which also contributes to our cash position
(see below), in addition to the proposed concentrate sale.

 

Monchetundra

The Definitive Feasibility Study ('DFS') at Monchetundra was approved by the
authorities in late June 2023. This allows Eurasia to present this development
and the resulting improvement in value to potential purchasers. The Company
does not believe it is appropriate to commence construction immediately, as it
is expected that any counterparties to the proposed asset sale may have their
own plans for the development of Monchetundra and can either proceed with the
EPCF contract signed with Sinosteel, or with a different contractor.

 

Financial position

The Company's current cash assets at 30 June 2023 including cash held in bank
accounts (£0.4 million) and US treasury notes (£1.54 million) totalled
£1.94 million. The value of unsold concentrate within Inventories at 30 June
2023 was approximately £3.5 million.  In addition, the Company expects to
receive VAT refunds of circa £1.5 million.

The Company's cash reserves are held in USD and GBP accounts outside of Russia
and therefore not directly or indirectly exposed to Rouble foreign exchange
gains or losses against other major hard currencies.

 

Sanctions

The Board continues to maintain a regular dialogue with the Company's legal
advisers regarding the potential impact of any US, UK or EU sanctions on the
Company, its operations and assets. The Company remains satisfied that its
current operations are not prohibited under US, UK or EU sanctions rules.
Furthermore, the Group does not engage and has not engaged with any sanctioned
persons, entities or agencies. The Group continues to closely monitor all
regulatory requirements and changes to the laws, rules and regulations, taking
steps whenever necessary to ensure compliance with new legislation.

 

Management changes

Following the retirement of James Nieuwenhuys as CEO, the Company has
established an Operations Committee, led by Christian Schaffalitzky, which
oversees the day-to-day project development activities of the Company,
alongside the proposed sale process on which the full Board is engaged.
Eurasia does not intend to make any further management appointments at this
stage.

 

Litigation

The previously announced litigation case between the Company and Queeld
Investments Limited and Mispare Limited, and Eurasia remains ongoing. Further
developments regarding this case will be announced as appropriate. The
previously announced case filed by Logik Developments Ltd was settled in July
2023.

 

Outlook

We recognise that, in relation to the potential asset sale, it may be a source
of frustration for shareholders that we cannot report on specific
counterparties, the nature of our discussions, and the ongoing processes in
more detail. This reflects the regulatory regime and the many confidentiality
agreements that govern this activity. However, although there can be no
guarantees, all the Eurasia Board members are engaged in contributing towards
a successful outcome to this process, and we look forward to providing our
shareholders with further updates as appropriate.

 

We again thank our shareholders for their continued support.

 

Christian Schaffalitzky

Chairman

Eurasia Mining PLC

 

 Condensed consolidated statement of comprehensive income
 for the six months ended 30 June 2023
                                                                                 Note  6 months to    12 months to   6 months to
                                                                                       30 June        31 December    30 June
                                                                                       2023           2022           2022
                                                                                       (unaudited)    (audited)      (unaudited)
                                                                                        £              £              £

 Sales                                                                           4      -              119,525        101,836
 Cost of sales                                                                          -              (30,173)       (36,197)
 Gross profit                                                                           -              89,352         65,639

 Administrative costs                                                                   (1,298,464)    (4,618,351)    (1,257,924)
 Investment income                                                                      53,184        61,325          10,070
 Finance costs                                                                          (44,789)       (107,697)      (49,717)
 Other gains                                                                     5      272,549        187,592        6,108,902
 Other losses                                                                    5      (6,361,898)    (2,842,309)    (1,024,892)

 (Loss)/profit before tax                                                               (7,379,418)    (7,230,088)    3,852,078

 Income tax expense                                                                     -              -              -

 (Loss)/profit for the period                                                           (7,379,418)    (7,230,088)    3,852,078

 Other comprehensive (loss)/income:
 Items that will not be reclassified subsequently to

profit and loss:
 NCI share of foreign exchange differences on translation of foreign operations         682,020        (61,656)       405,694
 Items that will be reclassified subsequently to

profit and loss:
 Parents share of foreign exchange differences on translation                           1,738,236      (341,762)      945,695

of foreign operations

 Other comprehensive income/(loss) for the period, net of tax                           2,420,256      (403,418)      1,351,389

 Total comprehensive (loss)/income for the period                                       (4,959,162)    (7,633,506)    5,203,467

 (Loss)/profit for the period attributable to:
 Equity holders of the parent                                                           (5,638,150)    (5,840,245)    2,556,416
 Non-controlling interest                                                               (1,741,268)    (1,389,843)    1,295,662
                                                                                        (7,379,418)    (7,230,088)    3,852,078

 Total comprehensive (loss)/income for the period attributable to:
 Equity holders of the parent                                                           (3,899,914)    (6,182,007)    3,502,111
 Non-controlling interest                                                               (1,059,248)    (1,451,499)    1,701,356
                                                                                        (4,959,162)    (7,633,506)    5,203,467

 Basic and diluted (loss)/profit (pence per share)                                      (0.20)         (0.21)         0.09

 

 

 Condensed consolidated statement of financial position
 As at 30 June 2023
                                                                                                                                                                                 Note  At 30 June      At 31 December  At 30 June
                                                                                                                                                                                       2023            2022            2022
                                                                                                                                                                                       (unaudited)     (audited)       (unaudited)
                                                                                                                                                                                       £               £               £
 ASSETS
 Non-current assets
 Property, plant and equipment                                                                                                                                                   6      8,470,553       9,600,231       12,634,691
 Assets in the course of construction                                                                                                                                                   538,537         696,026         1,329,132
 Intangible assets                                                                                                                                                               7      2,748,361       2,859,368       3,146,073
 Investment in financial assets                                                                                                                                                         1,592,143       3,807,925
 Investments in joint ventures                                                                                                                                                          -               -               584,591

 Total non-current assets                                                                                                                                                               13,349,594      16,963,550      17,694,487

 Current assets
 Inventories                                                                                                                                                                            3,687,482       4,182,382       2,135,082
 Trade and other receivables                                                                                                                                                     8      2,684,475       3,171,669       4,124,692
 Other financial assets                                                                                                                                                                 89,485          -               -
 Current tax assets                                                                                                                                                                     5,967           6,050           10,371
 Cash and bank balances                                                                                                                                                                 405,875         1,009,908       13,559,308

 Total current assets                                                                                                                                                                   6,873,284       8,370,009       19,829,453

 Total assets                                                                                                                                                                           20,222,878      25,333,559      37,523,940

 EQUITY
 Capital and reserves
 Issued capital                                                                                                                                                                  9      61,208,111      61,187,111      61,187,111
 Reserves                                                                                                                                                                        10     5,330,971       3,580,929       4,868,386
 Accumulated losses                                                                                                                                                                     (44,604,733)    (38,954,777)    (30,558,116)

 Equity attributable to equity holders of the parent                                                                                                                                    21,934,349      25,813,263      35,497,381
 Non-controlling interest                                                                                                                                                               (4,460,796)     (3,401,548)     (248,693)

 Total equity                                                                                                                                                                           17,473,553      22,411,715      35,248,688

 LIABILITIES
 Non-current liabilities
 Lease liabilities                                                                                                                                                               11     147,592         181,198         431,973
 Provisions                                                                                                                                                                      13     173,645         254,218         470,029

 Total non-current liabilities                                                                                                                                                          321,237         435,416         902,002

 Current liabilities
 Borrowings                                                                                                                                                                             -               -               50,833
 Lease liabilities                                                                                                                                                               11     98,256          167,071         211,397
 Trade and other payables                                                                                                                                                        12     2,265,361       2,230,879       1,111,020
 Provisions                                                                                                                                                                      13     64,471          88,478          -
 (file:///C%3A/Users/alexa/Documents/EURASIA/01%20-%20EURASIA%20-%20Current/Audit%20and%20Interims/2023-06%20interims/EUA%20Interim%202023-V2.xlsx#RANGE!EM_Provision_Current)

 Total current liabilities                                                                                                                                                              2,428,088       2,486,428       1,373,250

 Total liabilities                                                                                                                                                                      2,749,325       2,921,844       2,275,252

 Total equity and liabilities                                                                                                                                                           20,222,878      25,333,559      37,523,940

 Condensed statement of changes in equity
 For the six months ended 30 June 2022
                                                      Attributable to owners of the parent
                                      Note            Share           Share premium  Deferred shares  Other reserves  Foreign currency translation reserve  Accumulated losses  Total attributable to owners of parent  Non-controlling interest  Total equity

capital
                                                      £               £              £                £               £                                     £                   £                                       £                         £

 Balance at 1 January 2022                             2,853,560       51,308,068     7,025,483        3,924,026       (1,335)                               (33,114,532)        31,995,270                              (1,950,049)               30,045,221

 Transaction with owners                               -               -              -                -               -                                     -                   -                                       -                         -

 Loss for the period                                   -               -              -                -               -                                     2,556,416           2,556,416                               1,295,662                 3,852,078

 Other comprehensive loss
 Exchange differences on translation                   -               -              -                -               945,695                               -                   945,695                                 405,694                   1,351,389

of foreign operations
 Total comprehensive income                            -               -              -                -               945,695                               2,556,416           3,502,111                               1,701,356                 5,203,467
 Balance at 30 June 2022                               2,853,560       51,308,068     7,025,483        3,924,026       944,360                               (30,558,116)        35,497,381                              (248,693)                 35,248,688

 

 

 

 Condensed statement of changes in equity
 For the six months ended 30 June 2023
                                                         Attributable to owners of the parent
                                                   Note  Share        Share premium  Deferred shares  Other reserves  Foreign currency translation reserve  Accumulated losses  Total attributable to owners of parent  Non-controlling interest  Total equity

capital
                                                         £            £              £                £               £                                     £                   £                                       £                         £

 Balance at 1 January 2023                                2,853,560    51,308,068     7,025,483        3,924,026       (343,097)                             (38,954,777)        25,813,263                              (3,401,548)               22,411,715

 Issue of shares under employee share option plan         5,000        16,000                          11,806                                                (11,806)            -                                       -                         21,000
 Transaction with owners                                  5,000        16,000         -                11,806          -                                     (11,806)            -                                       -                         21,000

 Loss for the period                                      -            -              -                -               -                                     (5,638,150)         (5,638,150)                             (1,741,268)               (7,379,418)

 Other comprehensive loss
 Exchange differences on translation                      -            -              -                -               1,738,236                             -                   1,738,236                               682,020                   2,420,256

of foreign operations
 Total comprehensive income                               -            -              -                -               1,738,236                             (5,638,150)         (3,899,914)                             (1,059,248)               (4,959,162)
 Balance at 30 June 2023                                  2,858,560    51,324,068     7,025,483        3,935,832       1,395,139                             (44,604,733)        21,913,349                              (4,460,796)               17,473,553

 

 Condensed consolidated statement of cash flows
 for the six months ended 30 June 2021
                                                                       6 months to    12 months to    6 months to
                                                                       30 June        31 December     30 June
                                                                       2023           2022            2022
                                                                       (unaudited)    (audited)       (unaudited)
                                                                       £              £               £
 Cash flows from operating activities

 (Loss)/profit for the period                                           (7,379,418)    (7,230,088)     3,852,078
 Adjustments for:
 Depreciation and amortisation of non-current assets                    497,628       1,006,210        1,194,452
 - Asset value write off to cost of sales                                             2,365,988
 Gain/(loss) on sale or disposal of property, plant and equipment       -              (4,952)         (4,219)
 Finance costs recognised in profit or loss                             47,548         107,697         49,717
 Investment revenue recognised in profit or loss                        (53,184)       (61,325)        (10,070)
 (Gain)/loss on disposal of investments                                 18,362         814,158         -
 (Loss reversal)/loss recognised on valuation of inventory              (272,549)      2,028,151       1,024,892
 Rehabilitation cost recognised in profit or loss                       (57,548)       99,725          90,096
 Net foreign exchange loss/(profit)                                     6,343,536      (182,640)       (6,104,683)
                                                                        (855,625)      (1,057,076)     92,263
 Movements in working capital
 Increase in inventories                                                (75,390)       (6,166,681)     (3,098,450)
 Increase in trade and other receivables                                (71,805)       (1,300,887)     (1,614,762)
 Increase in trade and other payables                                   392,291        1,716,777       508,844
 Cash used in operations                                                (610,529)      (6,807,867)     (4,112,105)

 Net cash used in operating activities                                  (610,529)      (6,807,867)     (4,112,105)

 Cash flows from investing activities
 Payments for investment securities                                     -              (7,030,548)     -
 Proceeds from sale of investment securities                            2,284,775      2,835,299       -
 Interest received                                                      -              11,943          10,070
 loan provided to non-related party                                     (143,071)      -               -
 Investment to acquire interest in joint venture                        -              (354,769)       -
 Payments for property, plant and equipment                             (1,210,627)    (7,190,406)     (6,221,805)
 Payments for other intangible assets                                   (475,540)      (1,239,085)     (910,258)
 Proceeds from disposal of property, plant and equipment                -              4,952           4,219
 Net cash generated by/(used in) investing activities                   455,537        (12,962,614)    (7,117,774)
 Cash flows from financing activities
 Repayment of borrowings                                                -              (36,232)        -
 Proceeds from issues of equity shares                                  21,000         -               -
 Repayment of lease liability                                           (41,167)       (141,528)       (24,757)
 Interest paid                                                          (33,681)       (90,446)        (41,449)
 Net cash used in financing activities                                  (53,848)       (268,206)       (66,206)

 Net decrease in cash and cash equivalents                              (208,840)      (20,038,687)    (11,296,085)
 Effects of exchange rate changes on the balance of                     (395,193)      (960,912)       2,845,886

cash held in foreign currencies

 Cash and cash equivalents at the beginning of period                   1,009,908      22,009,507      22,009,507

 Cash and cash equivalents at the end of the period                     405,875        1,009,908       13,559,308

 

 

 

 Selected notes to the condensed consolidated financial statements for the six
 months ended 30 June 2023

 1. General information

 Eurasia Mining plc (the "Company") is a public limited company incorporated
 and domiciled in Great Britain with its registered office at International
 House, 42 Cromwell Road, London SW7 4EF, United Kingdom and principal place of
 business at Clubhouse Bank, 1 Angel Court, EC2R 7HJ. The Company's shares are
 listed on AIM, a market of the London Stock Exchange. The principal activities
 of the Company and its subsidiaries (the "Group") are related to the
 exploration for and development of platinum group metals, gold and other
 minerals in Russia.

 The financial information set out in these condensed interim consolidated
 financial statements (the "Interim Financial Statements") do not constitute
 statutory accounts as defined in Section 435 of the Companies Act 2006. The
 Group's statutory financial statements for the year ended 31 December 2022,
 prepared under International Financial Reporting Standards (the "IFRS"), have
 been filed with the Registrar of Companies. The auditor's report on those
 financial statements was unqualified. The report did not contain a statement
 under Section 498(2) of the Companies Act 2006.

 2. Basis of preparation
 The Group prepares consolidated financial statements in accordance with
 International Accounting Standards in conformity with the requirements of the
 Companies Act 2006. These condensed consolidated interim financial statements
 for the period ended 30 June 2023 have been prepared by applying the
 recognition and measurement provisions of IFRS and the accounting policies
 adopted in the audited accounts for the year ended 31 December 2022.
 These Interim Financial Statements have been prepared under the historical
 cost convention.
 The accounting policies have been applied consistently throughout the Group
 for the purposes of preparation of these condensed consolidated interim
 financial statements.
 The Interim Financial Statements are presented in Pounds Sterling (£), which
 is also the functional currency of the parent company.

 3. Accounting policies
 The Interim Financial Statements have been prepared in accordance with the
 accounting policies adopted in the Group's last annual financial statements
 for the year ended 31 December 2022.

 

 4. Revenue
                                        6 months to  12 months to  6 months to
                                        30 June      31 December   30 June
                                        2023         2022          2022
                                        £            £             £
 Sale of platinum and other metals       -           61,075         -
 Other revenue                           -           58,450         101,836

                                         -            119,525       101,836

 

 

 

 5. Other gains and losses
                                                                       6 months to    12 months to   6 months to
                                                                       30 June        31 December    30 June
                                                                       2023           2022           2022
                                                                       £              £              £
 Gains
 Gain on disposal of property, plant and equipment                      -              4,952          4,219
 Reversal of loss on revaluation of stock to net realisable value       272,549        -              -
 Net foreign exchange gain                                              -              182,640        6,104,683
                                                                        272,549        187,592        6,108,902
 Losses
 Impairment of investments                                              (18,362)       (814,158)      -
 Loss on revaluation of stock to net realisable value                   -              (2,028,151)    (1,024,892)
 Net foreign exchange loss                                              (6,343,536)    -              -
                                                                        (6,361,898)    (2,842,309)    (1,024,892)

                                                                        (6,089,349)    (2,654,717)    5,084,010

 

The majority of the foreign exchange gains and losses are a result of the
revaluation of monetary assets and liabilities in the subsidiary accounts as a
result of movements in the Rouble exchange rates.

In 2022 the Group took a decision to postpone the sale of platinum and other
metals due to a strong Ruble and low platinum price. Stock available at 30
June 2023 represents platinum concentrate ready for refining, which was valued
(i) using methodology set in the refining and sale and purchase agreement made
with local refinery in 2021 and (ii) exchange rate and metal prices at 30 June
2023.

 

 6. Property, plant and equipment
                                                 30 June        31 December    30 June
                                                 2023           2022           2022
                                                 £              £              £
 Net book value at the beginning of period        9,600,231      5,061,743      5,061,743
 Additions                                        1,137,353     2,443,927       5,911,509
 Transferred from assets under construction       90,499        4,776,644       -
 Written off to inventory                         -              (2,365,988)    (2,365,988)
 Depreciation                                     (497,628)      (1,006,210)    (1,194,452)
 Exchange differences                             (1,859,902)    690,115        2,855,891

 Net book value at the end of period             8,470,553      9,600,231      12,634,691

 7. Intangible assets
                                                 30 June        31 December    30 June
                                                 2023           2022           2022
                                                 £              £              £
 Net book value at the beginning of period        2,859,368      1,389,029      1,389,029
 Additions                                        475,540        1,239,085      910,258
 Exchange differences                             (586,547)      231,254        846,786

 Net book value at the end of period              2,748,361      2,859,368      3,146,073

Intangible assets represent capitalised costs associated with Group's
exploration, evaluation and development of mineral resources.

 

 

 8. Trade and other receivables
                                     30 June      31 December  30 June
                                     2023         2022         2022

  Trade receivables                   -            -            78,520
  Advances made                       677,536      822,280      1,759,183
  Prepayments                         26,929       135,447      36,681
  VAT recoverable                     1,496,281    1,942,410    2,123,355
  Other receivables                   483,729     271,532       126,953

                                     2,684,475    3,171,669    4,124,692

 

The fair value of trade and other receivables is not materially different to
the carrying values presented. None of the receivables are provided as
security or past due.

 

 9. Share capital
                                                                                 30 June        31 December    30 June
                                                                                 2023           2022           2022

  Issued ordinary shares with a nominal value of 0.1p:

  Number                                                                         2,858,559,995  2,853,559,995   2,853,559,995
  Nominal value (£)                                                              2,853,560      2,853,560       2,853,560

 Fully paid ordinary shares carry one vote per share and carry the right to
 dividends.

  Issued deferred shares with a nominal value of 4.9 p:
  Number                                                                          143,377,203    143,377,203    143,377,203
  Nominal value (£)                                                               7,025,483      7,025,483      7,025,483

 

Deferred shares have the following rights and restrictions attached to them:

- they do not entitle the holders to receive any dividends and distributions;

- they do not entitle the holders to receive notice or to attend or vote at
General Meetings of the Company; and

- on return of capital on a winding up the holders of the deferred shares are
only entitled to receive the amount paid up on such shares after the holders
of the ordinary shares have received the sum of 0.1p for each ordinary share
held by them and do not have any other right to participate in the assets of
the Company.

 

There had been no change in the issued share capital during the reporting
period.

 

 Ordinary shares                               Number of shares             Share             Share

capital
premium
                                                                           £                 £
 Balance at 1 January 2023                     2,853,559,995                2,853,560         51,308,068
 Exercise of warrants and options              5,000,000                    5,000             16,000

  Balance at 30 June 2023                      2,858,559,995                2,858,560         51,324,068

  Deferred shares                              Number of deferred shares    Deferred share

capital
                                                                           £
  Balance at 1 January and 30 June 2021        143,377,203                  7,025,483

 

 10. Reserves
                                           30 June      31 December  30 June
                                           2023         2022         2022
                                           £            £            £
 Capital redemption reserve                 3,539,906    3,539,906    3,539,906
 Foreign currency translation reserve       1,395,139    (343,097)    944,360
 Equity-based payment reserve               395,926      384,120      384,120

                                            5,330,971    3,580,929    4,868,386

 

 The capital redemption reserve was created as a result of a share capital
 restructuring in earlier years. There is no policy of regular transactions
 affecting the capital redemption reserve.
 The foreign currency translation reserve represents exchange differences
 relating to the translation from the functional currencies of the Group's
 foreign subsidiaries into GBP.
 The equity-based payments reserve represents a reserve arisen on (i) the grant
 of share options to employees under the employee share option plan and (ii) on
 issue of warrants under terms of professional service agreements.

 

 11. Lease liabilities

 The Group leases certain of its plant and equipment. The average lease term is
 4.5 years, expiring in 2025. The Group has option to purchase the equipment
 for a nominal amount at the maturity of the finance lease. The Group's
 obligation under finance leases are secured by the lessor's title to the
 leased assets.
 Interest rates underlying all obligations under finance leases are fixed at
 respective contract dates ranging from 21.9% to 23.5% per annum.

 

 Minimum lease payments                       30 June     31 December  30 June
                                              2023        2022         2022
                                              £           £            £
 Less than one year                            179,418    224,700       315,252
 Between one and five years                    103,334    202,820       496,817
 More than five years                         -           -            -
                                               282,753     427,520      812,069
 Less future finance charges                   (36,905)    (79,251)     (168,699)

 Present value of minimum lease payments       245,848     348,269      643,370

 Present value of minimum lease payments      30 June     31 December  30 June
                                              2023        2022         2022
                                              £           £            £
 Less than one year                            147,592    167,071       211,397
 Between one and five years                    98,256     181,198       431,973
 More than five years                         -           -            -

 Present value of minimum lease payments       245,848     348,269      643,370

 

 

 

 12. Trade and other payables
                                        30 June      31 December  30 June
                                        2023         2022         2022

  Trade payables                         802,525     270,214       615,115
  Accruals                               1,326,107   1,825,269     56,826
  Social security and other taxes        45,523      46,460        167,392
  Other payables                         91,206      88,936        271,687

                                        2,265,361    2,230,879    1,111,020

 

The fair value of trade and other payables is not materially different to the
carrying values presented. The above listed payables were all unsecured.

 

 13. Provision
                                                                         30 June         31 December    30 June
                                                                         2023            2022           2022
                                                                         £               £              £
 Long term provision:
 Environment rehabilitation                                               470,029         254,218        470,029
 Short term provision:
 Environment rehabilitation                                               -               88,478         -

                                                                          470,029         342,696        470,029

 Movement in provision                                                    Six month to    12 month to    Six month to
                                                                         30 June         31 December    30 June
                                                                         2023            2022           2022
                                                                         £               £              £
 At 1 January                                                             342,696        200,762         200,762
 Recognised in the period                                                 -              54,612          79,541
 Utilised in the period                                                   -               -              -
 Reduction resulting from re-measurement or settlement without cost       (57,548)       45,446          10,555
 Unwinding of discount and effect of changes in the discount rate         13,867         17,251          8,268
 Exchange difference                                                      (60,899)        24,625         170,903

 At the end of the period                                                 238,116         342,696        470,029

 

Provision is made for the cost of restoration and environmental rehabilitation
of the land disturbed by the West Kytlim mining operations, based on the
estimated future costs using information available at the reporting date.

The provision is discounted using a risk-free discount rate of from 6.6% to
6.88% (2020: 3.87% to 5.08%) depending on the commitment terms, attributed to
the Russian Federal Bonds.

Provision is estimated based on the sub-areas within general West Kytlim
mining licence the company has carried down its operations on by the end of
the reporting period. Timing is stipulated by the forestry permits issued at
the pre-mining stage for each of sub-areas. Actual costs in respect of the
long-term provision recognised by 30 June 2023 will be incurred within
2023-2025.

 

 

 14. Commitments

 At the time of the award of the Monchetundra mining license a royalty payment
 was calculated by the Russian Federal Reserves Commission. 20% of this payment
 was paid in December of 2018 and the remaining 80%, or Rub16.68 mln
 (approximately £150,000) to be paid by November 2023.

 During 2020 the Group entered into several lease agreements to lease mining
 plant and equipment. As at 30 June 2023 the average lease term was 2 years and
 present value of minimum lease payments £245,848 (2022: £643,370).

 

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