REG - Hamak Gold Limited - Results for the period from 6 May to 31 Dec 2021

Hamak GoldAnnouncement

10/06/2022 07:00

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RNS Number : 3991O  Hamak Gold Limited  10 June 2022

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10 June 2022

Hamak Gold Limited

("Hamak Gold" or the "Company")

Results for the period from 6 May to 31 December 2021

Availability of Annual Report

Hamak Gold Limited (LSE: HAMA) is pleased to announce its audited results for
the period from 6 May to 31 December 2021. This period was before the Company
listed its shares on the Main Market of the London Stock Exchange on 1 March
2022.

Copies of the Company's full Annual Report and Financial Statements for the
period from 5 May to 31 December 2021 will be made available on the Company's
website at www.hamakgold.com (http://www.hamakgold.com) and have been posted
to shareholders along with a Notice of Annual General Meeting, to be held on
30 June 2022 at 11:30am (UK time) at Peterhouse Capital Limited, 80 Cheapside
London, EC2V 6DZ.

About Hamak Gold Limited

Hamak Gold Limited (LSE: HAMA) is a UK listed company focussed on gold
exploration of a portfolio of licences in highly prospective areas of Liberia
and its growth strategy considers other exploration and development
opportunities in the wider West Africa region.

For further information you are invited to view the company's website at
www.hamakgold,com or please contact:

 Hamak Gold Limited

 Amara Kamara                         +231 (0) 77 005 0005

 Nicholas Karl Smithson               +44 (0) 77 837 07971
 Peterhouse Capital Limited (Broker)  +44 (0) 20 7469 0930

 Lucy Williams

 Guy Miller

 Yellow Jersey PR                     +44 (0) 20 3004 9512

 Tom Randell                          +44 (0) 7775 194357

 Annabelle Wills

 

Chairman Statement

 

Dear Shareholder,

 

I am pleased to present the annual report of Hamak Gold Limited (the "Company"
or "Hamak") and its subsidiary (collectively referred as the 'Group' or 'Hamak
Gold'). The Group undertakes gold exploration with a focus on highly
prospective licenses in Liberia, West Africa, for the period ended 31 December
2021

On 1 March 2022, Hamak was admitted to trading on the main market of the
London Stock Exchange in its initial public offering ("IPO"), simultaneously
raising gross proceeds of £955,000 in new capital from institutional and
private investors as well as the Board of Directors.

The Group acquired on 15 February 2022 two mineral exploration licences, Nimba
and Gozohn in Liberia, covering 1,752 square kilometres and also has an option
over a further five exploration licences covering an area of 3,213 square
kilometres.  Exploration has initially focused on detailed geochemical soil
sampling in the Gozohn and Nimba licences and further details are provided in
the Directors Report.

Strategy

The Group's main mineral exploration focus is on the discovery of orogenic
gold, Archaean and Paleoproterozoic greenstone hosted gold and shear zone
hosted gold type mineralization in underexplored, yet highly prospective,
areas of Liberia. The Group is also applying exploration techniques for the
discovery of base metals within its exploration licences. The Group's strategy
is built on three main pillars:

·      Identify highly prospective exploration ground and brownfield
projects in known mineral districts with demonstrated historical exploration
results and limited application of modern exploration techniques.

·    Develop proven and out-of-the-box concepts for potential mineral
targets and efficiently conduct exploration by application of state-of-the-art
methods and equipment.

·      Partner with other companies via joint ventures or farm-in
agreements.

Liberia

There has been a long history of artisanal gold mining in Liberia from
alluvial deposits. Following the end of hostilities (2003) and democratic
national elections (2005), a number of private and public junior companies
have undertaken systematic gold exploration in Liberia and within the last
decade, the gold sector of Liberia has seen considerable expansion.

Liberia is an emerging gold producing country having attracted significant
exploration interest and expenditure over the last decade. This transformation
of the country's gold sector is evidenced by annual production increasing
significantly since 2007 from a little over 300 kg (10,500 oz) to 7,096 kg
(250,300 oz) in 2018.

Liberia did not experience the gold exploration boom during the 1980s and
1990s that took place in neighboring West African countries mostly due to
political instability and therefore has remained relatively under-explored and
therefore can be considered highly prospective for gold and base metals.

Summary

The Board believes that the Group has acquired excellent prospective licences
that have proven occurrences of gold supported by excellent geological
formations and is encouraged by the initial geological work and sampling
results achieved in the Gozohn and Nimba licences. We expect that during the
coming year our dedicated exploration teams will identify key areas within
these two licences which can be drilled to intersect the bedrock source(s) of
the gold anomalies generated.

Hamak was admitted to the London Stock Exchange and should our exploration and
drilling lead to positive gold discoveries we believe that significant value
can be created for all shareholders.

I would like to thank all our employees, advisors, my fellow Board members and
our shareholders for their continued support to the Group as we transformed
from a private to a public Group and now as we look to grow our Group through
successful exploration of our own licences, as well as considering other value
accretive opportunities in the wider West African region.

 

Financial Overview

Funding

The Group is funded through investment from its shareholders. In the pre-IPO
period funding of £50,000 was secured through a zero-coupon convertible loan
note, which converted into ordinary shares at the admission ("Admission") to
the London Stock Exchange trading at a 25% discount to the IPO price. The
Group also raised gross proceeds of £955,000 as part of the initial listing
on the London Stock Exchange ("LSE") on 1 March 2022, subsequent to the period
end.

Revenue

Being an early-stage exploration Group, the Group generated no revenue during
the period, but is focusing on its exploration licences in Liberia with a
strategy of making significant gold discoveries in the shortest possible time
frame.

Expenditure

During the period, the Group progressed all legal, accounting and due
diligence work related to IPO which was achieved on the 1 March 2022 (post
period).  Expenditure during the period was focused on the Admission process
and, following Admission, the Group has focused its efforts and expenditure on
progressing its exploration programmes in line with our stated strategy.

Liquidity, cash and cash equivalents

On 31 December 2021, the Group held $501 in funds and a receivable of $1,400
from the balance of the pre-IPO funding of £50,000, and added gross proceeds
of £955,000, subsequent to the period end following its successful listing on
the London Stock Exchange.

Dividend

The Directors do not intend to declare a dividend in respect of the period
under review.

 

Amara Kamara

Executive Chairman

8 June 2022

Strategic Report
 
Fair Business Review
The Company was incorporated on 6 May 2021 under the BVI Business Companies Act. As at the date of this report, the Group comprises the Company and its sole wholly owned subsidiary, Hamak Gold Limited Liberia, which was incorporated in Liberia on 27 May 2021.
To enable to Group to pursue its principal activities, it sought an IPO of the Company's securities on the London Stock Exchange through a Standard Listing to raise the necessary funds required for the execution of its business strategy. The IPO was successfully completed after the period end, and the Company's shares were admitted for trading on 1 March 2022.
The Group's main mineral exploration focus is the discovery of orogenic gold, Archaean and Paleoproterozoic greenstone hosted gold, and shear zone hosted gold type mineralization in underexplored yet highly prospective areas of Liberia. The Group is also applying modern exploration techniques for the discovery of base metals within its exploration licences. Being an exploration business without producing mines, the Group will have no revenue and will have to rely on debt and/or equity as its major source of funding. If the Group is successful in its exploration activities, it will seek to transition into an exploration and development business.
The Group acquired on 15 February 2022 two mineral exploration licences in Liberia, Nimba and Gozohn, covering 1,752 square kilometres and also has an option over a further five exploration licences covering an area of 3,213 square kilometres.  Exploration has initially focused on detailed geochemical soil sampling in the Gozohn and Nimba licences, with further details provided in the Directors Report.
In the Group's Prospectus dated 24 February 2022, the Competent Person ranked the seven mineral exploration licences (MELs) individually and in accordance with their geological and spatial relationship with specific geological structures as well as on the scale of gold mining activity in or near those licences. Often licences can be grouped according to their prospectivity and relative proximity to each other. Thus, the following ranking of the licences is advised by the Competent Person:
 
Rank No. 1: Cestos shear zone and greenstone belts
·      Nimba Licence
·      Gozohn Licence
Rank No. 2: Dube shear zone and Birimian greenstones
·      River Gee Licence
Rank No. 3: Lofa and Yambesei shear zones and greenstones
·      Fasama
·      Lofa
Rank No. 4: Juazohn shear zone and amphibolites
·      Cestos Licence
·      Sinoe Licence
 
Initially two MELs, Nimba and Gozohn, have been transferred on 15 February 2022 to the Group following approval of such licence transfer from the Minister of Mines and Energy of Liberia on 3 August 2021.. The Group retains an option with respect to the other five MELs, which if exercised will result in the transfer of these licences into its portfolio.
 
Business plan and strategic objectives
The Group's long-term strategic objectives are to be a best-in-class, regionally competitive gold exploration and mining business and an industry leader in terms of health and safety, Environmental, Social, and Governance ("ESG"), operational efficiency and asset quality. The Group will seek to achieve these aims through managing its operations safely and sustainably, with a view to ensuring that, subject to successfully discovering commercially viable and extractable mineral deposits, the Group will be in an optimal position to create value and generate returns for Shareholders and significant benefits for all stakeholders including local communities.
There are a number of risks associated with newly listed entities in the natural resources sector, especially in West Africa. The Board regularly reviews the risks to which the Group is exposed and also endeavors to mitigate them as far as possible.
The following summary, which is not exhaustive, outlines some of the risks and uncertainties the Group may be exposed to:

Geopolitical

The Group will be subject to risks associated with operating in Liberia which include economic, social or political instability. The legal system is less developed than in more established countries and there is a risk of crime and corruption from operating in Liberia

No operating history

The Group is a newly formed entity with no operating history other than the successful Admission which was completed after the period on 1 March 2022.  However, the Board and Management of the Group have considerable exploration, development and mining experience in the West Africa region, in particular in Liberia, Sierra Leone and Guinea.

Exploration and development risks

Following the Group's acquisition of its target licences in the natural resources sector subsequent to period end, they are likely to be subject to a high degree of risk as mineral exploration and development can be highly speculative. The economics of developing mineral properties are affected by many factors including the cost of operations, variations of the grade of ore mined, fluctuations in the price of the minerals being mined, fluctuations in exchange rates, costs of development, infrastructure and processing equipment and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection.
In addition, the grade of mineralisation ultimately mined may differ from that indicated by drilling results and such differences could be material. As a result of these uncertainties, there can be no guarantee that mineral exploration and development of any of the Group's investments will result in profitable commercial operations.

Liquidity risk

Whilst the directors are confident that the Group will be able to raise
additional funds as and when required and will have sufficient funds to
continue to meet its liabilities as they fall due for at least 12 months from
the date of approval of the consolidated financial statements, there can be no
assurance that such funds as may be required will be raised.

Industry-specific risks

The natural resources sector is inherently tied to the performance of the global economy and fluctuations in the price of global commodities. As a result, segments of the natural resources sectors (or even the sector as a whole) could be affected by changes in general economic activity levels and other changes which are beyond the Group's control. The revenues and earnings from developing its assets will rely on commodity prices, and the Group will be unable to control the prices for commodities, which may adversely affect the Group's business, results of operations, financial condition or prospects.
Key performance indicators
Appropriate key performance indicators will be identified in due course as the business strategy is implemented.
Gender analysis

A split of directors by gender during the year is shown below:

 Male  Female
 2     nil

Directors and employees
The Group currently has only male directors and is committed to promoting gender equality based on relevant skills and experience as it progresses through its life cycle.
Environment, Social and Corporate Governance (ESG)
As a new Group focused on early-stage exploration, we aim to conduct our business with honesty, integrity and openness, respecting human rights and the interests of our shareholders, employees and local community stakeholders. We aim to provide timely, regular and reliable information on the business to all our shareholders and conduct our operations to the highest standards.

Environment

The Group has in place all necessary environmental permissions for the Nimba and Gozohn licences which are the focus of our exploration activity.  These permits are issued by the Environmental Protection Agency (EPA) of Liberia according to the prevailing laws of the country.
Social
The Group is performing regional exploration work so is not yet focused on any defined areas within its licences.  However, the Group adheres to the social requirements within the country of working with local communities at all times, engaging with them so they are aware of our activities and where possible recruiting labour from nearby communities.  In addition, the Mineral Law of Liberia requires that 2% of exploration expenditure be invested in education or health facilities in the exploration licences where the work is conducted.  The Group will adhere to this requirement and make such provision at the end of each financial year once the expenditure has been calculated for the period.

Corporate Governance

Being a public Group listed on the LSE Standard Exchange, the Group will adopt all required Governance rules and has in place the necessary structure of Board committees to oversee the business of the Group to ensure adherence to best practice procedures.

Health and Safety

We strive to create a safe and healthy working environment for the wellbeing of our staff and create a trusting and respectful environment, where all members of staff are encouraged to feel responsible for the reputation and performance of the Group. We aim to establish a diverse and dynamic workforce with team players who have the experience and knowledge of the business operations and markets in which we operate. Through maintaining good communications, members of staff are encouraged to realize the objectives of the Group and their own potential.

Amara Kamara

Executive Chairman

 

8 June 2022

CONSOLIDATED STATEMENT OF INCOME FOR THE PERIOD ENDED 31 DECEMBER 2021

 

                            Notes             Period Ending
                            31 December 2021
                            $

 Administrative expenses    4                 355,378
 Operating loss                               355,378

 Loss before taxation                         355,378

 Income Tax                                   -
 Loss after taxation                          355,378

                                              355,378
 Total loss for the period

Total comprehensive loss for the year attributable
to
(355,378)

shareholders from continuing operations

 

 

 

 

Basic & dilutive earnings per share - USD
                                     7
                (7.11)

 

 

The consolidated statement of income has been prepared on the basis that all
operations are continuing operations.

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021

 

 

                                 Notes             As at
                                 31 December 2021
                                 $
 Assets
 Current assets
 Cash and cash equivalents       8                 500
 Trade and other receivables     9                 1,400
 Total current assets                              1,900

 Total assets                                      1,900

 Equity and liabilities
 Equity                                                                               -

 Share capital
 Retained earnings                                 (355,378)
 Total equity                                      (355,378)

 Liabilities
 Current liabilities             11                285,207

 Trade and other payables
 Unsecured convertible loan      10                70,000
 Overdraft                       13                2,071
 Total current liabilities                         357,278

 Total Equity & Liabilities                        1,900

 

The Financial statements were approved by the Board on 8 June by:

Nicholas Karl Smithson

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY PERIOD ENDED 31 DECEMBER 2021

 

                                       Share        Retained    Total
                                       Capital      Earnings    Equity

                                       $            $           $
 (Loss) for the period                 -            (355,378)   (355,378)

 Total comprehensive (loss) for year   -            (355,378)   (355,378)

 

 

  Balance at 31 December                                                -          (355,378)     (355,378)
 2021

 CONSOLIDATED STATEMENT OF CASHFLOW                    Period ended
                                                       31 December 2021
                                                       $
 Cash flows from operating activities
 Net Loss                                              (355,378)
 Adjusted for:
       Trade and other payables                        285,207
       Trade and other receivables                     (1,400)
 Net Cash flow (used in) operating activities          (71,570)
 Cash flow from financing activities
 Cash flows from Unsecured convertible loans           70,000
 Net Cash flow from financing   activities             70,000

 Net (decrease) in cash and cash equivalent            (1,570)
 Cash and cash equivalents at beginning of period      -
 Cash and cash equivalents at end of period            (1,570)

 

 

Cash and cash equivalents in the cashflow statement includes overdraft and
cash at bank.

 

 

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