REG - Ironveld PLC - Final Results for the year ended 30 June 2024
01/04/2025 07:00
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RNS Number : 9928C Ironveld PLC 01 April 2025
This announcement contains inside information
Ironveld PLC
Final Results for the year ended 30 June 2024
Ironveld PLC ("Ironveld" or the "Company"), the owner of a, High Purity Iron
("HPI"), Vanadium, and Titanium project located on the Northern Limb of the
Bushveld Complex in Limpopo Province, South Africa, announces its final
results for the 12 months ended 30 June 2024. Hard copies of these results
have been posted to shareholders.
Operational and Financial
· Essential upgrades at the smelter complex to achieve profitable
production capacity
· Kristoffer Andersson was appointed as Chief Executive Officer in May
2024
Post Period End and Outlook
· A fundraising and capital reorganisation was completed in November
2024, raising gross proceeds of £2.5 million at an issue price of 0.036 pence
per share
· Ironveld subsidiary, Ironveld Holdings, signed an updated term sheet
with Sable Exploration and Mining Ltd. regarding the Company's joint venture
at the Lapon magnetite plant in Limpopo Province, South Africa
For further information, please contact:
Ironveld plc c/o BlytheRay
Kristoffer Andersson, Chief Executive Officer +44 20 7138 3204
Cavendish Capital Markets Limited (Nomad and Broker) +44 20 7220 0500
Derrick Lee / Adam Rae
Turner Pope Investments (TPI) Ltd (Joint Broker) +44 20 3657 0050
Andrew Thacker / James Pope
BlytheRay +44 20 7138 3204
Tim Blythe / Megan Ray
CHAIRMAN'S STATEMENT
Dear Shareholder,
I am pleased to present the Annual Report and the Financial Statements for the
year to 30 June 2024.
This year has been one of transition and foundation-building for Ironveld as
we focused on creating a platform for sustainable growth. While the year under
review was relatively quiet operationally, I am pleased to report significant
progress made during and post-period in securing funding and advancing key
strategic initiatives.
During the Period, several important changes to our leadership were
implemented to support our evolving strategy. In October 2023, I assumed the
role of Executive Chairman, succeeding Giles Clarke, who transitioned to a
Non-Executive Director role. Giles's experience and commitment over the years
have been invaluable to Ironveld, and I was grateful for his continued support
during this transition. In May 2024, we were delighted to welcome Kristoffer
Andersson as Chief Executive Officer. Kris's experience in mining, renewable
energy, and commodities, along with his international experience, brings a
fresh perspective to the Company as we advance our strategic goals. Post
period, in November 2024, Giles retired from the Board. His leadership and
insight have played a pivotal role in shaping Ironveld, and we extend our
sincere thanks for his contribution. Following this change, I transitioned to
the role of Non-Executive Chairman to ensure continuity as we embark on the
next stage of growth.
Financial stability has been a key focus throughout the year. During the
Period, we raised vital funds through a combination of equity placements and
working capital facilities, including a premium fundraising of £1.0 million
in October 2023 and additional working capital facilities of £375,000 in
February 2024 and £125,000 in April 2024. These measures were essential in
supporting the Company's operational requirements and ensuring stability while
we progressed discussions on broader funding initiatives.
However, the most transformative development came post-period, with the
successful completion of a £2.5 million fundraising and proposed capital
reorganisation in October 2024. This funding will enable the Company to
complete the DMS plant in Limpopo and also make essential upgrades to our
smelter complex, allowing us to achieve profitable production capacity and
advance towards revenue generation and cash flow positivity by the end of Q2
2025. As part of our short-term goals, we aim to produce market samples of
water-atomised high-purity iron powders at our smelter facility in Rustenburg,
supported by the construction of a pilot plant to validate product quality and
market acceptance. Production trials have already demonstrated operational
capability, and securing offtake agreements for these products is expected to
facilitate further funding opportunities to scale up operations. A third-party
consultant with extensive experience in water-based atomisation has made
significant progress on the design phase of a pilot plant for producing market
samples and has completed an initial layout. Final design specifications and
cost estimates are expected by the end of April 2025. The agreement for the
acquisition of Ferrochrome Furnaces (Pty) Limited ("FCF") remains in place
under unchanged terms. The Board continues to regard the transaction as a
highly attractive opportunity, taking into account, among other factors, the
favourable terms agreed, the significant tax losses available within FCF, and
the strong potential to successfully produce high-margin, high-purity iron
powders.
As mentioned above, a portion of the proceeds from the fundraising was
allocated to complete operational facilities at the mine and for the
commissioning and completion of the DMS plant, where the majority of the plant
is now installed. With robust operational plans and growing market demand, I
am confident that Ironveld's strategic positioning will enable the Company to
generate sustainable growth through the production of iron powder, vanadium
slag, and titanium slag. With considerable growth potential at the Project as
well as opportunities to increase further DMS magnetite production, transition
to higher-value products, and expand smelter facilities, I am excited about
what the future holds for the Company.
Operationally, we achieved notable progress with the renegotiated DMS
Magnetite joint venture with Sable Platinum Holdings (Pty) Ltd a wholly owned
subsidiary of Sable Exploration and Mining.Ltd The restructured funding
arrangement enables Ironveld to supply ore to the JV without the need for
upfront capital, reducing overall average mining costs and accelerating the
timeline to positive cash flow. In February 2024, we received a non-binding
term sheet from a South African financial institution, offering financing for
our mining and smelting activities. This funding was set to support key
investments, including the transition to producing high-purity iron powders, a
major strategic goal for Ironveld. However, by June, we learned the finance
package could be significantly reduced and delayed due to further due
diligence and the uncertainties surrounding the South African election
process. While this was a setback, discussions are ongoing, and we remain
focused on securing the funding needed to drive our plans forward.
We have also taken significant steps to optimise operational efficiency and
reduce costs across the business. In October 2023, I conducted a comprehensive
review of our cost structures in both the UK and South Africa and identified
key opportunities for improvement. As part of this process, we made the
strategic decision to place the smelter on care and maintenance temporarily,
allowing us to conserve cash and focus resources on essential upgrades.
Additionally, we are proactively evaluating options to transition to more
cost-effective power solutions that will drive a sustained reduction in
operational expenses both in the near future and over the long term. As part
of this transition, we will benefit from significant cost savings, enabling us
to manage short-term challenges more effectively while reinforcing our
foundation for long-term sustainability and growth.
Responsible operations remain a cornerstone of our values. Through our Social
Labour Plan, we remain committed to supporting our host communities through
infrastructure improvements, training, and employment opportunities, ensuring
shared value and sustainable growth.
Looking ahead, we are confident that the progress made during and after the
reporting period has positioned Ironveld for meaningful transformation. Our
priorities include near term cash flow generation from the DMS grade Magnetite
project and continuing work at the smelter to deliver high-quality, high-value
products, strengthening revenue generation and cash flow positivity, and
capitalising on our significant untapped asset value to provide long-term
sustainable growth. I am confident that the actions we have taken will drive
significant progress for Ironveld and deliver tangible value for our
shareholders.
On behalf of the Board, I would like to express my gratitude to our
shareholders for their continued support and trust, as well as to our team for
their dedication and hard work. Together, we are building a stronger, more
resilient Ironveld, and I look forward to updating you on our progress in the
year ahead.
Dr John Wardle
Non-Executive Chairman
STRATEGIC REPORT
Financial
The Group recorded a loss before tax of £1.2 million (2023: £1.2 million) in
the Period. No dividend can be paid for the year ended 30 June 2024. To date,
the Board has focused on securing the funding required to bring the Company to
the point of production and completing critical upgrades to the smelter
complex. In future periods, with the Company transitioning towards production
and operational expansion, the directors expect KPIs for the business to focus
on production output, revenue growth, profitability, and the safe and
efficient operation of the smelter complex. Appropriate KPIs reflecting these
priorities will be included in future reporting.
Going concern
As at the date of these Financial Statements, the Company is engaged in
negotiations with a financial institution in South Africa regarding a
significant funding transaction. These discussions have been ongoing for
several months and expected to conclude during 2025. Whilst the transaction
has not yet been finalised at the date of approval of these financial
statements, the Company remains confident in its ability to secure the
necessary funding and taking into account the £2.5 million fundraising
completed in October 2024, these Financial Statements have been prepared on a
Going Concern basis.
Given the investment made into the DMS plant (post period), which is
anticipated to generate profitable revenue in the near future, the Company
will be in a significantly stronger position to secure alternative funding if
necessary. This strengthened position will be supported by revenue generation
from the DMS plant and the sale of DMS-grade magnetite.
The Company is not limited to one funding pathway and continues to pursue and
assess financing opportunities that are best aligned with its strategic
objectives and the best long-term interests, beyond the scope of the current
discussions. In light of the significant investments made post-period end and
following the fundraise completed in late 2024, the Company believes it is now
in a stronger and more favourable position to successfully secure additional
funding during 2025, should it be required.
However, until funding is committed, this represents a material uncertainty
that may impact the Group's ability to continue as a going concern.
Outlook
The Company expects to progress with the plans outlined in the "Successful
Completion of Conditional £2.5 Million Fundraise and Proposed Capital
Reorganisation" news release from 30 October 2024, which includes advancing
its key strategic initiatives including establishing Ironveld as the first
producer of high-purity water-atomised iron in the Southern Hemisphere,
completion of essential upgrades at the smelter complex and progression
towards revenue generation and cash flow positivity.
The renegotiated agreement with Sable Platinum Holdings (Pty) Ltd (post
period) significantly strengthens Ironveld's position by increasing our equity
stake in the DMS project from 25% to 50%. Under this revised structure, the
joint venture will operate as a 50/50 partnership between Altona Processing
(Pty) Ltd, a wholly owned subsidiary of Ironveld Holdings, and Lapon Plant
(Pty) Ltd, a wholly owned subsidiary of Sable Platinum Holdings (Pty) Ltd. The
project has progressed according to schedule and is expected to enter first
commercial production in April 2025. We have high expectations for this joint
venture with Sable Platinum Holdings (Pty) Ltd and believe it will unlock
additional exciting and diversified opportunities in the future.
We extend our gratitude to all our shareholders for their ongoing support of
the Company and the Project. We look forward to sharing further updates with
you in the near future.
Principal risks and uncertainties
The Directors consider the following risks to be the most material or
significant for the management of the business. These issues do not purport to
be a complete list or explanation of all the risks facing the Group. In
particular the Group's performance may be affected by changes in market and/or
economic conditions, changes in legal, regulatory or tax requirement
legislation.
The Board of Directors monitors these risks and the Group's performance on a
regular basis.
Operational risks - The production of the Company's range of metals involves a
series of processes, from the mining of the ore at the mine site, the
production of the DMS grade magnetite at the DMS plant, to the smelting of
material at the Rustenburg smelter. Mining, production and Smelting operations
are subject to a number of risks, including mechanical outages, supply issues
(e.g. fuel), interruptions due to weather and soil conditions, among many
others.
Availability of finance - Expansion of current activities or further
development and production from the ore resources requires significant further
capital expenditure and the Group will need to raise further finance. The
terms on which future funds can be raised may not be on terms which the
Directors consider acceptable. The Group is listed on the public markets which
greatly assists in the raising of additional finance.
Governance and Compliance - There are multiple governance-based risks which
may have an impact on the business. The Group operates within a complex
regulatory environment which focuses on accountability. Failure to comply with
regulations, including applicable licences required for continuous operations,
or failure to follow expected social and business conduct could cause
potential interruption or stoppage of operations, potential financial loss and
reputational damage.
Health and Safety - Mining and Smelting operations by their very nature are
dangerous working environments which, if not managed, could lead to serious
injuries and a loss of life.
Commodity Markets - A significant decrease in commodity prices for high purity
iron, vanadium or titanium would negatively impact Group revenues.
Inflation - The Group's cost base is highly susceptible to inflationary
pressures. In cycles of high commodity prices, input costs, such as wages,
consumables, diesel and energy often increase at a rate higher than that of
general inflation. Rising costs, which could be triggered by and therefore
offset by higher commodity prices, have a direct impact on the Group's
profitability. In addition, inflationary pressures have an impact on capital
expenditure.
Political and Country risk - Substantially all of the Group's business and
operations are conducted in South Africa and the political, economic, legal
and social situation in South Africa introduces a certain degree of risk with
respect to the Group's activities.
s172 Statement - Director's statement in performance of their statutory duties
in accordance with s172 (1) Companies Act 2006
During the year ended 30 June 2024 the Board of Directors consider that they
have acted in a way that would be most likely to promote the success of the
company for the benefit of its members (having regard to the stakeholders and
the matters set out in s172(1)(a)-(f) of the Companies Act 2006).
The Board has elected to apply the Quoted Company Alliance Corporate
Governance Code as part of its commitment to high standards of corporate
governance in all of its activities and complies with its requirements as far
as is practicable and appropriate for a company of its nature and size.
The Directors are aware of their responsibilities to take into consideration
the interests of all stakeholders in their decision making process and to
promote the success of the Company in accordance with s172. The Directors
continue to pay full regard to the interests of the stakeholders.
The requirements of s172 are for the Directors to:
• Consider the likely consequences of any decision in the long term,
• Act fairly between the members of the Company,
• Maintain a reputation for high standards of business conduct,
• Consider the interests of the Company's employees,
• Foster the Company's relationships with suppliers, customers and others,
and
• Consider the impact of the Company's operations on the community and the
environment.
The Company is quoted on AIM and its members will be fully aware, through
detailed announcements, shareholder meetings and financial communications,
updated on the website, of the Board's broad and specific intentions and the
rationale for its decisions. When making decision, the Board of Directors,
issues such as the impact on the community and the environment have actively
been taken into consideration. The Company pays its employees and creditors
promptly and keeps its costs to a minimum to protect shareholders funds. The
Company recognises workers' representation unions and complies with all local
employment legislation.
The key decisions made in the year to promote this success are explained in
the Strategic Report above.
Kris Andersson
Chief Executive Officer
CONSOLIDATED INCOME STATEMENT
2024 2023
Note
£000 £000
Revenue
4
267 103
Cost of sales
(5) (29)
( )
Gross profit
262 74
Administrative
expenses
(1,404) (1,310)
Other income
1
-
( )
(
)
Operating loss
5
(1,141) (1,236)
Other gains and losses
7
- 47
Investment revenues
8
6 34
Finance costs
9
(92) (15)
( )
(
)
Loss before
tax
(1,227) (1,170)
Tax
10
(192) 711
( )
(
)
Loss for the
year
(1,419) (459)
( )
Attributable to:
Owners of the
Company
(1,405) (435)
Non-controlling
interests
(14) (24)
( )
(
)
(1,419) (459)
( )
(
)
Loss per share - Basic and diluted
11
(0.04p) (0.02p)
(
)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2024 2023
£000 £000
Loss for the period
(1,419) (459)
Exchange difference on translation of foreign
operations
913 (4,387)
( )
(
) Total comprehensive loss for the year
(506) (4,846)
(
)
Attributable to
Owners of the
Company
(606)
(4,250)
Non-controlling
interests
100 (596)
( )
( )
(506) (4,846) (
) In respect of the exchange differences on translation of foreign operation,
the amounts charged/credited to other comprehensive income may be reclassified
to the income statement in future periods.(
)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
2024 2023
Note
£000 £000
Non-current assets
Intangible assets
13
28,357 24,061
Property, plant and equipment
14
7,205 6,938
Investments
15
- -
Other receivables
17
8 130
( )
(
)
( )
35,570 31,129
( )
(
)
Current assets
Inventories
16
43 45
Trade and other receivables
17
115 307
Cash and cash equivalents
25
4 19
( )
( )
162 371
( )
(
) Total
assets
35,732 31,500
( )
(
) Current liabilities
Payables and contract liabilities
18
(4,541) (1,862)
Lease liabilities
19
(11) (10)
Borrowings
20
(570) -
( )
(
)
(5,122) (1,872)
( )
( )
Non-current liabilities
Payables and contract liabilities
18 (4,334)
(4,162)
Lease liabilities
19
(26) (27)
Deferred tax liabilities
21 (3,615)
(3,284)
( )
( )
(7,975) (7,473)
( )
( )
Total
liabilities
(13,097) (9,345)
( )
( )
Net
assets
22,635 22,155
( )
(
) Equity
Share capital
23
13,054 12,694
Share premium
24
25,925 25,324
Other reserve
24
82 94
Retained earnings
24
(10,213) (8,845)
Foreign currency translation reserve
24
(9,061) (9,860)
( )
(
) Equity attributable to owners of the
Company
19,787
19,407
Non-controlling interests
29
2,848 2,748
(
) Total
equity
22,635 22,155
( )
( )
These financial statements were approved by the Board and authorised for issue
on 28 March 2025.
Signed on behalf of the Board
K Andersson
Director
Company Registration No: 04095614
PARENT COMPANY STATEMEMNT OF FINANCIAL POSITION
2024 2023
Note
£000 £000
Non-current assets
Investments
15
32,599 30,854
( )
( )
Current assets
Trade and other receivables
17
17 57
Cash and cash equivalents
25
3
17
( )
( )
20 74
( )
( )
Total
assets
32,619 30,928
( )
(
)
Current liabilities
Trade and other payables
18
(810) (267)
Borrowings
20
(510) -
( )
( )
Total
liabilities
(1,320) (267)
( )
( )
Net
assets
31,299 30,661
( )
( )
Equity
Share capital
23
13,054 12,694
Share premium
24
25,925 25,324
Other reserve
24
82 94
Retained earnings
24
(7,762) (7,451)
( )
( )
Total
equity
31,299 30,661
(Attributable to owners of the
Company)
( )
(
)
The loss for the financial year dealt with in the financial statements of the
parent Company was £348,000 (2023 - loss £602,000).
These financial statements were approved by the Board and authorised for issue
on 28 March 2025.
Signed on behalf of the Board
K Andersson
Director
Company Registration No: 04095614
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to owners of the Company:
Foreign
Share
Share Other Retained
currency Owners of
Non-controlling
Total
Capital
Premium Reserve earnings
translation the Company
Interest Equity
£000 £000
£000 £000
£000
£000
£000 £000
At 1 July 2022 10,453
21,379 12
(8,421)
(6,045)
17,378 3,344
20,722
Loss for the year -
-
- (435)
-
(435) (24)
(459)
Exchange difference on
translation of foreign
operations
-
-
-
-
(3,815)
(3,815) (572)
(4,387)
Issue of share capital 2,241
3,945 -
-
-
6,186 -
6,186
Exercise of share warrants -
-
82
-
-
82
-
82
Share based payments -
-
-
11
-
11
-
11
(
) At 30 June 2023 12,694 25,324
94 (8,845)
(9,860)
19,407 2,748
22,155
(
)
( )
(
)
Profit (loss) for the year -
-
- (1,405)
-
(1,405) (14)
(1,419)
Exchange difference on
translation of foreign -
-
- -
799
799
114 913
operations
Issue of share capital 360
601
- -
-
961
- 961
Share based payments -
-
- 25
-
25
25
Cancelled share
-
- (12)
12
-
- -
-
warrants
(
) ( )
(
) At 30 June 2024 13,054 25,925
82 (10,213) (9,061)
19,787
2,848 22,635
(
)
COMPANY STATEMENT OF CHANGES IN EQUITY
Equity attributable to the equity holders of the Company:
Share Share Other
Retained Total
Capital Premium Reserve
Earnings Equity
£000 £000
£000 £000 £000
At 1 July 2022
10,453
21,379 12
(6,860) 24,984
Loss for the year
-
-
- (602)
(602)
Issue of share capital 2,241
3,945 -
- 6,186
Issue of share warrants
-
-
82
- 82
Share based payments
-
-
-
11 11
(
) At 30 June 2023 12,694
25,324 94
(7,451) 30,661
(
)
Loss for the year
-
-
- (348)
(348)
Issue of share capital
360 601
-
- 961
Share based payments
-
-
-
25 25
Cancelled share warrants -
- (12)
12 -
(
) At 30 June 2024 13,054
25,925 82
(7,762) 31,299
(
)
CONSOLIDATED CASH FLOW STATEMENT
2024 2023
Note
£000 £000
Cash used in operating activities
25
(305) (672)
Interest
paid
(29) (3)
( )
(
)
Net cash used in operating
activities
(334) (675)
( )
(
)
Investing activities
Purchases of property, plant and
equipment
- (2,337)
Purchase of exploration and evaluation
assets
(1,202)
(2,513)
Interest
received
6 34
Loans to Joint
Venture
- (141)
Loans received from Joint
Venture
4 24
Other
loans
(3) -
( )
(
)
Net cash used in investing
activities
(1,195) (4,933)
( )
(
)
Financing activities
Proceeds on issue of equity (net of
costs)
961 5,755
Proceeds from new
loans
557 -
Repayment of
loans
- (140)
Payment of lease
liabilities
(5) (4)
( )
(
) Net cash generated by financing
activities
1,513
5,611
( )
(
)
Net increase/(decrease) in cash and cash
equivalents
(16) 3
Cash and cash equivalents at beginning
of year
25
19 17
Effects of foreign exchange
rates
1 (1)
( )
(
)
Cash and cash equivalents at end of year
25
4 19
( )
(
)
COMPANY CASH FLOW STATEMENT
2024 2023
Note
£000
£000
Cash used in operating activities
25
(333) (1,100)
( )
(
)
Net cash used in operating
activities
(333) (1,100)
( )
(
)
Investing activities
Payments to acquire investments -
loans
(1,140) (4,510)
( )
(
) Net cash used in investing
activities
(1,140) (4,510)
( )
(
)
Financing activities
Proceeds on issue of equity (net of
costs)
961 5,755
Proceeds from new
loans
498 -
Repayment of
loans
- (140)
( )
(
) Net cash generated by financing
activities
1,459
5,615
( )
(
)
Net increase/(decrease) in cash and cash
equivalents
14 5
Cash and cash equivalents
at
beginning of year
25
17 12
( )
(
) Cash and cash equivalents at end of year
25
3 17
( )
( )
( )
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. General information
Ironveld Plc is a public company incorporated and domiciled in England and
Wales under the Companies Act 2006 whose shares are listed on the AIM. The
address of the registered office is given on page 2. The nature of the Group's
operations and its principal activities are set out in note 3 and in the
Directors Report on page 8.
Adoption of new and revised Standards
In the current year, the Group has applied new or amended standard for the
first time which are mandatory for accounting periods commencing on or after 1
July 2023. None of the standards adopted had a material impact on the
financial statements. The significant new and amended standards adopted were
as follows:-
Amendments to IAS 1 in respect of the disclosure of accounting policies
Amendments to IAS 8 in respect of the definition of accounting estimates
Amendments to IAS 12 in respect of deferred tax relating to assets and
liabilities arising from a single transaction
At the date of authorisation of these financial statements, amendments to
existing standards and interpretations, applicable to the group, are not yet
effective and have not been adopted early by the Group. The adoption of these
standards, amendments and interpretations is not expected to have a material
impact on the Group and Company's results or equity.
2.1 Material accounting policies
The financial statements are based on the following policies which have been
consistently applied:
Basis of preparation
The financial statements of the Group and Parent Company have been prepared in
accordance with UK-adopted international accounting standards (IFRSs) in
conformity with the requirements of the Companies Act 2006.
The financial statements have been prepared on the historical cost basis. The
financial statements are presented in pounds sterling because that is
considered to be the currency of the primary economic environment.
The material accounting policies are set out below:
Going concern
The Directors have, at the time of approving the financial statements, a
reasonable expectation that the Company and the Group has adequate resources
to continue in operating existence for the foreseeable future. Thus,, they
continue to adopt the going concern basis of accounting in preparing the
financial statements though a material uncertainty is identified and of which
further details are provided in the note 2.2 and in the Directors Report on
pages 5 to 7. The financial statements therefore do not include the
adjustments that would result if the Group and Company were unable to continue
as a going concern.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and all entities controlled by the Company (its subsidiaries) made
up to the year-end. Control is achieved where the Company has power to govern
the financial and operating policies of an investee entity so as to obtain
benefits from its activities.
Subsidiaries are consolidated from the date of their acquisition, being the
date on which the Company obtains control and ceases when the Company loses
control of the subsidiary. Profit or loss and each component of other
comprehensive income are attributed to the owners of the Company and to the
non-controlling interests. Total comprehensive income of the subsidiaries is
attributed to the owners of the Company and to the non-controlling interests
even if this results in the non-controlling interests having a deficit
balance.
Non-controlling interests in subsidiaries are identified separately from the
Group's equity therein. Those interests of non-controlling shareholders are
initially measured at their proportionate share of the fair value of the
acquiree's identifiable net assets. Subsequent to acquisition, the carrying
value of the non-controlling interests is the amount of initial recognition
plus the non-controlling interests' share of the subsequent changes in equity.
Changes in the Group's interests in subsidiaries that do not result in a loss
of control are accounted for as equity transactions. The carrying amount of
the Group's interests and the non-controlling interests are adjusted to
reflect the changes in their relative interests in the subsidiaries. Any
difference between the amount by which the non-controlling interests are
adjusted and the fair value of the consideration paid or received is
recognised directly in equity and attributed to the owners of the Company.
Joint ventures
A joint venture (JV) is a type of joint arrangement in which the parties with
joint control of the arrangement have rights to the net assets of the
arrangement. A separate vehicle (not the parties) will have the rights to the
assets and obligations for the liabilities, relating to the arrangement. The
JV is not dependent on the parties to the arrangement for funding and the
parties to the arrangement have no obligations for the liabilities of the
arrangement. The Group's investment in its JV is accounted for using the
equity method.
Under the equity method, the investment in the JV is initially recognised at
cost to the Group. In subsequent periods, the carrying amount of the JV is
adjusted to recognise changes in the Group's share of net assets of the JV
since the acquisition date. Goodwill relating to the JV is included in the
carrying amount of the investment and is neither amortised nor individually
tested for impairment.
The statement of profit or loss and other comprehensive income reflects the
Group's share of the results of the operations of the JV. In addition, when
there has been a change recognised directly in the equity of the JV, the Group
recognises its share of any changes, when applicable, in the statement of
changes in equity. Unrealised gains and losses resulting from transactions
between the Group and the JV are eliminated to the extent of the interest in
the JV.
The aggregate of the Group's share of profit or loss of the JV is shown on the
face of the statement of profit or loss and other comprehensive income as part
of operating profit and represents profit or loss after tax and
non-controlling interests in the subsidiaries of JV. The financial statements
of the JV are prepared for the same reporting period as the Group. When
necessary, adjustments are made to bring the accounting policies in line with
those of the Group.
After application of the equity method, the Group determines whether it is
necessary to recognise an impairment loss on its investment in the JV. At each
reporting date, the Group determines whether there is objective evidence that
the investment in the JV is impaired. If there is such evidence, the Group
calculates the amount of impairment as the difference between the recoverable
amount of the JV and its carrying value, then recognises the loss as 'Share of
profit of a joint venture' in the statement of profit or loss and other
comprehensive income. On loss of joint control over the JV, the Group measures
and recognises any retained investment at its fair value. Any difference
between the carrying amount of the JV upon loss of joint control and the fair
value of the retained investment and proceeds from disposal is recognised in
the statement of profit or loss and other comprehensive income.
Business combinations
Acquisitions of subsidiaries which are determined to be business combinations
under IFRS3 are accounted for using acquisition accounting. The consideration
for each acquisition is measured at the fair value of assets given,
liabilities incurred or assumed and equity instruments issued by the Group in
exchange for control in the acquiree. Acquisition-related costs are recognised
in the income statement as incurred. Acquisitions of subsidiaries which are
determined not to be business combinations under IFRS3 are accounted for on
other bases, taking into account the application guidance in Appendix B of
IFRS3. Where the directors consider it appropriate to do so the directors will
apply the concentration test permitted by para B7B of IFRS3 and account for an
acquisition of a subsidiary as an asset acquisition.
Revenue from contracts with customers
The Group is principally engaged in the business of producing Magnetite ore
and speciality metals including High Purity Iron, Vanadium slag and Titanium
slag. Revenue is measured based on the consideration specified in a contract
with a customer and excludes amounts collected on behalf of third parties. The
Group recognises revenue when it transfers control of a product or service to
a customer. If a customer pays consideration before the Group transfers the
goods or services to the customer a contract liability is recognised when the
payment is made or due (whichever is earlier). Contract liabilities are
recognised as revenue when the Group performs under the contract.
Exploration and evaluation
Costs incurred prior to acquiring the rights to explore are charged directly
to the income statement.
Licence acquisition costs and all other costs incurred after the rights to
explore an area have been obtained, such as the direct costs of exploration
and appraisal (including geological, drilling, trenching, sampling, technical
feasibility and commercial viability activities) are accumulated and
capitalised as intangible exploration and evaluation ("E&E") assets,
pending determination. Amounts charged to project partners in respect of costs
previously capitalised are deducted as contributions received in determining
the accumulated cost of E&E assets.
E&E assets are not amortised prior to the conclusion of the appraisal
activities. At completion of appraisal activities, if financial and technical
feasibility is demonstrated and commercial reserves are discovered then,
following development sanctions, the carrying value of the relevant E&E
asset will be reclassified as a development and production asset in intangible
assets after the carrying value has been assessed for impairment and, where
appropriate adjusted. If after completion of the appraisal of the area it is
not possible to determine technical and commercial feasibility or if the legal
rights have expired or if the Group decide to not continue activities in the
area, then the cost of unsuccessful exploration and evaluation are written off
to the income statement in the relevant period.
The Group's definition of commercial reserves for such purposes is proved and
probable reserves on an entitlement basis. Proved and probable reserves are
the estimated quantities of minerals which geological, geophysical and
engineering data demonstrate with a specified degree of certainty to be
recoverable in future years from the known reserves and which are considered
to be commercially producible.
Such reserves are considered commercially producible if management has the
intention of developing and producing them and such intention is based upon:
- a reasonable
expectation that there is a market for substantially all of the expected
production;
- a reasonable
assessment of the future economics of such production;
- evidence that the
necessary production, transmission and transportation facilities are available
or can be made available;
and
- agreement of
appropriate funding; and
- the making of the
final investment decision.
On an annual basis a review for impairment indicators is performed. If an
indicator of impairment exists an impairment review is performed. The
recoverable amount is then considered to be the higher of the fair value less
costs of sale or its value in use. Any identified impairment is written off to
the income statement in the period identified.
Taxation
The tax expense represents the sum of the tax payable and deferred tax.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amount of assets and liabilities in the financial
statements and the corresponding tax base used in the calculation of the
taxable profit and is accounted for using the statement of financial position
liability method. Deferred tax liabilities are generally recognised on all
appropriate taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits will be
available against which the deductible timing differences can be utilised. The
carrying amount of deferred tax assets is reviewed at each statement of
financial position date.
Deferred tax is calculated at the tax rates that are expected to be applicable
in the period when the liability or asset is realised and is based on tax laws
and rates substantially enacted at the statement of financial position date.
Deferred tax is charged in the income statement except where it relates to
items charged/credited in other comprehensive income, in which case the tax is
also dealt with in other comprehensive income.
Leases
The Group assesses whether a contract is or contains a lease, at inception of
the contract. The Group recognises a right-of-use asset and a corresponding
lease liability with respect to all lease arrangements in which it is the
lessee, except for short-term leases (defined as leases with a lease term of
12 months or less) and leases of low value assets (such as tablets and
personal computers, small items of office furniture and telephones). For these
leases, the Group recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease unless another systematic basis
is more representative of the time pattern in which economic benefits from the
leased assets are consumed. Right-of-use assets are measured at cost less any
accumulated depreciation and impairment losses and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use assets includes
the amount of the lease liability recognised, initial direct costs incurred,
and lease payments made at or before the commencement date less any lease
incentives received. Right-of-use assets, included in plant and machinery, are
depreciated on a straight-line basis over the shorter of the lease term and
the estimated life of the asset.
Lease liabilities ate recognised at the commencement of a lease as the present
value of lease payments expected to be made using the rate implicit in the
lease or where this is not available, the group incremental borrowing rate.
The lease liability is subsequently remeasured if there is a modification, a
change in lease term, a change in lease payments or a change in the assessment
of an option to purchase the underlying asset.
Property, plant and equipment
Tangible fixed assets are stated at cost less depreciation. Depreciation is
provided at rates calculated to write off the cost less the estimated residual
value of each asset over its expected useful life, as follows:
Plant and machinery Between 2 and 6 years straight line basis
Motor vehicles 6 years straight line basis
Assets under construction Not depreciated until brought
into use
Leased assets are depreciated in a consistent manner over the shorter of their
expected useful lives and the lease term.
Inventories
Inventories are measured at the lower of cost and net realisable value on the
first-in-first-out basis.
Net realisable value is the estimated selling price in the ordinary course of
business less the estimated costs of completion and the estimated costs
necessary to make the sale.
The cost of inventories comprises of all costs of purchase, costs of
conversion and other costs incurred in bringing the inventories to their
present location and condition.
The cost of inventories of items that are not ordinarily interchangeable and
goods or services produced and segregated for specific projects is assigned
using specific identification of the individual costs.
The cost of inventories is assigned using the formula. The same cost formula
is used for all inventories having a similar nature and use to the entity.
When inventories are sold, the carrying amount of those inventories are
recognised as an expense in the period in which the related revenue is
recognised. The amount of any write-down of inventories to net realisable
value and all losses of inventories are recognised as an expense in the period
the write-down or loss occurs. The amount of any reversal of any write-down of
inventories, arising from an increase in net realisable value, are recognised
as a reduction in the amount of inventories recognised as an expense in the
period in which the reversal occurs.
Foreign currencies
The individual financial statements of each group company are presented in the
currency of the primary economic environment in which it operates (its
functional currency). For the purposes of the consolidated financial
statements, the results and financial position of each group company are
expressed in pounds sterling, which is the functional currency of the Company,
and the presentation currency for the consolidated financial statements.
In preparing the financial statements of the individual companies,
transactions in currencies other than the entity's functional currency are
recognised at the rates of exchange prevailing on the dates of the
transactions. At each statement of financial position date, monetary assets
and liabilities that are denominated in foreign currencies are retranslated at
the rates prevailing at that date. Non-monetary items carried at fair value
that are denominated in foreign currencies are translated at the rates
prevailing at the date the fair value was determined. Non-monetary items that
are measured in terms of historical cost in a foreign currency are not
retranslated. Exchange differences are recognised in the income statement in
the period in which they arise.
When presenting the consolidated financial statements, the assets and
liabilities of the Group's foreign operations are translated at the exchange
rates prevailing at the statement of financial position date. Income and
expense items are translated at average exchange rates for the period, unless
exchange rates have fluctuated significantly in which case the rates at the
date of the transactions are used. Exchange differences arising are recognised
in other comprehensive income and accumulated in equity (attributed to
non-controlling interests where appropriate).
Goodwill and fair value adjustments arising on the acquisition of a foreign
entity are treated as assets and liabilities of the foreign entity and
translated using the closing rate.
Financial instruments
Financial assets and financial liabilities are recognised in the Group's
statement of financial position when the Group becomes a party to the
contractual provisions of the instrument.
Other receivables
Other receivables are measured at initial recognition at fair value, and are
subsequently measured at amortised cost using the effective interest rate
method except for short-term receivables when recognition of interest would be
immaterial. The Group recognises appropriate allowances for expected credit
losses in the income statement based on a historical credit loss experience,
adjusted for factors that are specific to the debtors and general economic
conditions.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other
short term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of change in value.
Financial liability and equity
Interest bearing bank and other loans and bank overdrafts are recorded at the
proceeds received, net of direct issue costs. Finance charges, including
premiums payable on settlement or redemption and direct issue costs, are
accounted for on an accrual basis in the income statement using the effective
interest rate method and are added to the carrying amount of the instrument to
the extent that they are not settled in the period in which they arise.
The Group classifies financial instruments, or their component parts, on
initial recognition as a financial asset, financial liability or an equity
instrument in accordance with the substance of the contractual arrangement.
Financial instruments are initially recognised at fair value and are
subsequently amortised using the effective interest method. Fair value is
estimated from available market data and reference to other instruments
considered to be substantially the same.
Trade and other payables
Trade payables and other financial liabilities are initially measured at fair
value, and are subsequently measured at amortised cost, using the effective
interest rate method.
The Group's activities expose it primarily to the financial risks of changes
in interest rates on borrowings and foreign exchange risk.
Investments
Investments in subsidiaries are stated at cost less any provision for
impairment.
Share-based payments
The Group issues equity-settled share-based payments to certain employees and
other parties. Equity settled share-based payments are measured at fair value
at the date of grant. In respect of employee related share based payments, the
fair value determined at the grant date is expensed on a straight-line basis
over the vesting period, based on the Group's estimate of shares that will
eventually vest. In respect of other share based payments, the fair value is
determined at the date of grant and recognised when the associated goods or
services are received.
Operating segments
The Group considers itself to have one operating segment in the year and
further information is provided in note 3.
Cost of sales
When inventories are sold, the carrying amount of those inventories is
recognised as an expense in the period in which the related revenue is
recognised. The amount of any write-down of inventories to net realisable
value and all losses of inventories are recognised as an expense in the period
the write-down or loss occurs. The amount of any reversal of any write-down of
inventories, arising from an increase in net realisable value, is recognised
as a reduction in the amount of inventories recognised as an expense in the
period in which the reversal occurs.
2.2 Critical accounting estimates and judgements
The Group makes estimates and assumptions regarding the future. Estimates and
judgements are continually evaluated based on historical experience and other
factors, including expectations of future events that are believed to be
reasonable under the circumstances. In the future, actual experience may
differ from these estimates and assumptions. The estimates and assumptions
that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year are discussed
below.
Critical judgements
The following judgements have had the most significant effect on the amounts
recognised in the financial statements:
Going concern
As at the date of these Financial Statements, the Company is engaged in
negotiations with a financial institution in South Africa regarding a
significant funding transaction. These discussions have been ongoing for
several months and expected to conclude during 2025. Whilst the transaction
has not yet been finalised at the date of approval of these financial
statements, the Company remains confident in its ability to secure the
necessary funding and taking into account the £2.5 million fundraising
completed in October 2024, these Financial Statements have been prepared on a
Going Concern basis.
Given the investment made into the DMS plant (post period), which is
anticipated to generate profitable revenue in the near future, the Company
will be a significantly stronger position to secure alternative funding if
necessary. This strengthened position will be supported by revenue generation
from the DMS plant and the sale of DMS-grade magnetite.
The Company is not limited to one funding pathway and continues to pursue and
assess financing opportunities that are best aligned with its strategic
objectives and the best long-term interests, beyond the scope of the current
discussions. In light of the significant investments made post-period end and
following the fundraise completed in late 2024, the Company believes it is now
in a stronger and more favourable position to successfully secure additional
funding during 2025, should it be required.
However, until funding is committed, this represents a material uncertainty
that may impact the Group's ability to continue as a going concern.
Exploration and evaluation assets
The Group has adopted a policy of capitalising the costs of exploration and
evaluation and carrying the amount without impairment assessment until
impairment indicators exist (as permitted by IFRS 6). The directors consider
that as at the Period end the Group remained in the exploration and evaluation
phase and therefore, under IFRS 6, the directors have to make judgements as to
whether any indicators of impairment exist and the future activities of the
Group. No such indicators of impairment were identified and therefore, in
accordance with IFRS 6, no impairment review has been carried out. The
Directors remain committed to development of the asset.
Acquisition of Ferrochrome Furnaces (Pty) Limited ("FCF")
On 24 May 2022 the Company announced that it had agreed Heads of Terms and on
31 August 2022 further announced that it had signed a share purchase agreement
to acquire 100% of the share capital of FCF, which would provide the Group
with an existing smelting facility (the Rustenburg Smelter) which, following
refurbishment, would provide the Group with the opportunity to commence
processing the ore. The acquisition by subsidiary Ironveld Smelting
(Proprietary) Limited, reflected an agreement with the shareholders and the
Business Rescue Practitioner of FCF to acquire the entire share capital for a
nominal amount but at the date of these accounts the agreement remained
subject to contract. Under the agreed terms, the Group will be required to
enter into a debt purchase agreement with the sole creditor of FCF for a total
of R116 million (approximately £5.0 million). If the purchase price is paid
in full on completion then a discount of 10% can be achieved on the
outstanding balance. Since the transaction becoming unconditional the Group
has incurred £2 million on refurbishing the smelter complex.
This results in the directors making the following critical judgements in
preparing these financial statements:
Nature of the acquisition - The directors have considered application notes of
IFRS3 and elected to apply the optional test set out in paragraph B7B of IFRS
3 (the 'concentration test') which permits a simplified assessment of whether
an acquired set of activities and assets is not a business. Having determined
that the concentration test is met and the set of activities and assets is not
a business no further assessment is considered necessary. The acquisition of
FCF will therefore be accounted for as an asset acquisition and not a business
combination.
Recognition of assets under construction and related debt obligations -The
directors have considered the definition of an asset set out in Chapter 4 of
the Conceptual Framework for Financial Reporting issued by the International
Accounting Standards Board. In their consideration the directors have had
regard to the Group's unencumbered use of the smelter, including the right to
use it to generate revenue, management's actions in refurbishing the smelter
complex for long term use, the status of the Business Rescue process and
consents obtained from the sole creditor of FCF and the probability of a range
of possible outcomes and of inflows or outflows of economic benefits. The
directors have also considered IAS 16 para 7 in relation to recognition
criteria, in particular paragraph 7 (a) which refers to whether it is probable
that future economic benefits will flow to the group. Based on the nature of
the facts and the actions of management the directors consider that the
'probable' threshold has been passed and therefore it is appropriate to
recognise the asset as an asset under construction at the year end.
As a consequence of their determination the directors have recognised the
Rustenburg smelter complex in assets under construction (see note 14) and also
the deferred and contingent debt obligations under the Debt Purchase Agreement
(see note 18)
Until the Business Rescue process in South Africa is fully concluded in all
respects the acquisition remains subject to contract and there is an element
of uncertainty over this accounting treatment. If for any reason, the
likelihood of which the directors consider to be remote, final closure of the
Business Rescue process does not take place it is probable that asset under
construction of £6.9 million and associated deferred and contingent debt
obligations of £5.0 million would be derecognised and capitalised
refurbishment expenditure of £2.3 million would be expensed.
Investment impairment indicators
The Company statement of financial position includes an investment in
subsidiary companies of £32,599,000 which is underpinned and reflects the
underlying subsidiary exploration and evaluation assets discussed above. At
the reporting date the group's market capitalisation was less than the
carrying value of the investment, which is an indicator of impairment under
IAS36. An impairment review has been carried out in the period - see note 15.
Deferred tax assets
The directors must judge whether the future profitability of the Group is
likely in making the decision whether or not to recognise a deferred tax asset
in respect of taxation losses. No deferred tax assets have been recognised in
the year.
Key sources of estimation uncertainty
No estimates and assumptions, having a significant risk of causing a material
adjustment to the carrying amounts of the assets and liabilities have been
identified.
3. Business and geographical segments
Information reported to the Group Directors for the purposes of resource
allocation and assessment of segment performance is focused on the activity of
each segment and its geographical location. The directors consider that there
is only one business segment, which is the activity of prospecting,
exploration and mining based in South Africa.
4. Revenue
2024 2023
£000 £000
Revenue from contracts with customers - disaggregated revenue information
Sale of goods - Contract
Smelting
248 18
Sale of goods - Other sales
19 85
( )
(
)
267 103
(
) All revenue represented the sale of goods and was recognised at a point in
time.
5. Operating loss
2024 2023
Operating loss for the year is shown after
charging:
£000 £000
Depreciation on tangible assets
18 17
Short term payments under leases
43 32
Share based payment charge
25 11
Foreign exchange loss/(gain)
- 5
Cost of inventories recognised as
expense
5 29
(
)
Auditors' remuneration
Fees payable to the auditors for the audit of the Company's accounts
45 40
(
)
6. Staff costs
Group
2024 2023
£000 £000
Wages and salaries
1,326 2,042
Social security costs
51 48
Pension costs
41 84
Share based payments
25 11
Directors other fees
104 134
( )
(
)
1,547 2,319
(
)
The average monthly number of employees, including Directors,
during
2024 2023
the period was as follows:
Number Number
Administration and
management
16 22
Mining and smelting
71 77
( )
(
)
87 99
(
)
2024 2023
£000 £000
Directors remuneration and other fees
448 468
Pension
18 15
Share based payments
11 7
( )
( )
477 490
(
)
2024 2023
£000 £000
The aggregate remuneration and fees paid to the highest paid
Director was
193 193
Pension
17 15
Share based payments
- 3
( )
( )
210 211
(
)
Further details of the Directors' remuneration are given in the Directors'
Remuneration Report on page
11. Company
2024 2023
£000 £000
Wages and salaries
334 334
Social security costs
45 41
Share based payments
23 3
Pension costs
17 15
Directors other fees
19 -
( )
(
)
438 393
(
)
The average monthly number of employees,
2024 2023
including Directors, during
Number Number
the period was as follows:
Administration and
management
6 6
(
)
7. Other gains and losses
2024 2023
£000 £000
Gain on settlement of financial liabilities with
equity
- 47
( )
8. Investment revenues
2024 2023
£000 £000
Interest on financial deposits
6 34
(
)
9. Finance costs
2024 2023
£000 £000
Loan interest and similar
charges
62 11
Interest on lease
liabilities
6 2
Other interest
24 -
Other finance costs
- 2
( )
(
)
92 15
(
) 10. Tax
2024 2023
a) Tax charge/(credit) for the
period
£000 £000
Corporation tax:
Current
period
- -
Deferred tax (note
21)
192 (711)
(
)
192 (711)
(
)
b) Factors affecting the tax charge for the period
Loss on ordinary activities for the period before
taxation
(1,227)
(1,170)
(
) Loss on ordinary activities for the period before taxation multiplied by
effective rate of corporation tax in the UK of 25% (2023 -
19%)
(307) (222)
Effects of:
Expenses not deductible for tax
purposes
53 1
Tax losses not
recognised
455 118
Tax losses not previously recognised
(47) (451)
Change in tax rates
- (157)
Other differences
38 -
(
) Tax charge/(credit) for the
period
192 (711)
(
)
c) Factors that may affect future tax charges - The Group has estimated
unutilised tax losses amounting to £7,277,000 (2023 - £6,078,000) the values
of which are not recognised in the statement of financial position. These
losses represent a potential deferred taxation asset of £1,842,000 (2023 -
£1,524,000) based on the enacted future tax rate of 25% in the United Kingdom
and 27% in South Africa, which would be recoverable should the Group make
sufficient suitable taxable profits in the future.
In addition, the Group has pooled exploration costs incurred of £13,312,000
(2023 - £9,610,000) which are expected to be deductible against future
trading profits of the Group.
11. Loss per share
2024 2023
£000 £000
Loss attributable to the owners of the
Company
(1,419) (435)
(
)
Loss per share - Basic and diluted
Continuing operations
(0.04p) (0.02p)
( )
( )
The calculation of basic earnings per share is based on 3,800,317,435 (2023 -
2,963,582,067) ordinary shares, being the weighted average number of ordinary
shares in issue during the year. Where the Group reports a loss for the
current period, then in accordance with IAS 33, the share options are not
considered dilutive. Details of such instruments which could potentially
dilute basic earnings per share in the future are included in note 23.
12. Loss attributable to owners of the parent Company
As permitted by Section 408 of the Companies Act 2006, the profit and loss
account of the parent Company is not presented as part of these accounts. The
parent Company's loss for the financial year amounted to £348,000 (2023 -
£602,000).
13. Intangible assets
Exploration
and evaluation
assets
£000
Group
Cost:
At 1 July
2022
26,350
Additions
2,513
Exchange
differences
(4,802)
(
) At 30 June
2023
24,061
(
)
Additions
3,241
Exchange
differences
1,055
(
) At 30 June
2024
28,357
(
)
Impairment and amortisation:
At 1 July 2022, 30 June 2023 and at 30 June
2024
-
(
) Net book value at 30 June
2024
28,357(
)
Net book value at 30 June
2023
24,061
(
)
The Group's exploration and evaluation assets all relate to South Africa.
In respect of the exploration and evaluation assets which remain in the
appraisal phase, the Group has performed a review for impairment indicators,
as required by IFRS 6 and in the absence of such indicators no impairment
review was carried out.
14. Property, plant and
equipment
Assets under
Motor Plant
and
Group
construction vehicles
machinery Total
£000
£000
£000 £000
Cost:
At 1 July 2022
-
-
40 40
Additions
7,132
58
22 7,212
Exchange differences (252)
(6)
(9) (267)
( )
(
)
At 30 June 2023 6,880
52
53 6,985
(
)
Additions
-
-
- -
Exchange differences 283
2
2 287
( )
(
)
At 30 June 2024 7,163
54
55 7,272
(
)
Depreciation:
At 1 July 2022
-
-
38 38
Charge for the period
-
12
5 17
Exchange differences
-
(1)
(7) (8)
( )
(
)
At 30 June 2023 -
11
36 47
(
)
Charge for the period
-
11
7 18
Exchange differences
-
-
2 2
( )
(
)
At 30 June 2024 -
22
45 67
(
)
Net book value
7,163
32
10 7,205
at 30 June 2024
( )
(
)
Net book value
6,880
41
17 6,938
at 30 June 2023
( )
(
)
The asset under construction represents the cost of refurbishment of the
Rustenburg smelter and includes £4,334,000 (2023 - £4,829,000) of deferred
costs which at the balance sheet date were unconditional but remained subject
to contract.
All non-current assets in 2024, 2023 and 2022 were located in South Africa.
15. Investments
Group - Loans to other entities
2024 2023
£000 £000
Cost:
At 1
July
291 352
Exchange differences
12 (61)
( )
At 30 June
303 291
( )
Impairment:
At 1 July
291 352
Exchange differences
12 (61)
( )
At 30 June
303 291
( )
Book value at 30 June
- -
(
)
The investment represented the R7 million refundable deposit to Siyanda
Smelting and Refining Proprietary Limited which the Group paid in exchange for
a period of exclusivity to conclude a potential acquisition of the company.
The period of exclusivity expired in 2017. The deposit is interest free and
becomes refundable should the acquisition not proceed. The investment was
fully impaired as at 30 June 2024 and 2023 whilst the directors pursued other
alternative opportunities.
Company - Subsidiary undertakings
Loans
Equity Total
£000
£000 £000
Cost:
At 1 July
2022
5,683 20,334
26,017
Additions
4,837
-
4,837( )
(
)
At 30 June
2023
10,520
20,334 30,854
( )
Additions
1,745
- 1,745
(
)
At 30 June
2024
12,265
20,334 32,599
(
)
Net book value at 30 June
2024
12,265
20,334 32,599
( )
( )
Net book value at 30 June
2023
10,520
20,334 30,854
( )
The loans represent loans to Ironveld Holdings (Propriety) Limited of
£12,067,000 (2023 - £10,342,000) which incur interest at a rate not
exceeding the base lending rate applicable in England and Wales. Under the
initial terms of the loan, £2,500,000 was repayable 31 December 2019 with the
remainder due 31 December 2020 however further agreement has extended the loan
period until project finance is agreed. Also included in loans are working
capital loans to Ironveld Mauritius Limited of £197,000 (2023 - £178,000)
which are interest free.
At the reporting date the Group's market capitalisation was less than the
carrying value of the Company's investments in subsidiaries, which is an
indicator of impairment under IAS36. An impairment review has been carried out
in the period.
The Company's investments in subsidiary undertakings of £32,599,000 is
underpinned and reflects the underlying exploration and evaluation assets and
the expected future cash flows from the Rustenburg smaller complex once fully
operational. These have been treated as a single cash generating unit for the
purposes of the review. Impairment was tested by discounting the expected cash
flows of a pilot scale operation of the smelter complex over a 10 year period.
Cash flows, net of acquisition debt repayments, were discounted using an
industry standard appraisal rate of 10% and sensitised for reasonably possible
alternative scenarios, including discount rate. The Company's investment on
subsidiaries is not impaired on the base case or in any of the reasonably
possible alternative scenarios applied.
The Company has investments in the following subsidiaries.
Proportion of Nature of
Name of company
Shares voting rights
business
and shares held
Subsidiary undertakings
Ironveld (Mauritius)
Ordinary *100%
Holding Company
Ironveld Holdings (Proprietary) Limited Ordinary
100%
Holding Company
Ironveld Mining (Proprietary) Limited
Ordinary 100%
Mining and
Exploration
Ironveld Energy (Proprietary) Limited
Ordinary
100%
Ore processing and
smelting
Ironveld Smelting (Proprietary) Limited Ordinary
74%
Ore processing
and
smelting
HW Iron (Proprietary) Limited
Ordinary 68%
Prospecting and
mining
Lapon Mining (Proprietary) Limited
Ordinary 74%
Prospecting and
mining
Luge Prospecting and
Mining (Proprietary) Limited
Ordinary 74%
Prospecting and
mining
Joint venture
Ipace Proprietary Limited
Ordinary
50% Sale of Magnetite
ore
* Held directly by Ironveld Plc all other holdings are indirect.
All subsidiary undertakings are incorporated and domiciled in South Africa,
other than Ironveld Mauritius Limited, which is incorporated and domiciled in
Mauritius.
The registered office of all subsidiaries with the exception of Ironveld
(Mauritius) was Gartner House, 33 Wessel Road, Rivonia 2128, South Africa.
The registered office of Ironveld (Mauritius) is - C/o Rogers Capital
Corporate Services Limited, 3(rd) Floor, Rogers House, No. 5 President John
Kennedy Street, Port Louis, Republic of Mauritius.
Further details of non-wholly owned subsidiaries of the Group are provided in
note 29.
16. Inventories
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Ore stockpile
43
45
-
-
( )
(
)
Due within 12 months
43
45
- -
( )
17. Trade and other
receivables
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Trade receivables
-
7
- -
Other receivables
70
222
5 6
Amounts owed by related parties
8
5
- -
Amounts owed by joint ventures
-
125
- -
Prepayments
45
78
12 51
( )
(
)
123
437
17 57
Due within 12 months
(115)
(307)
(17) (57)
( )
(
) Due after more than 12
months
8
130
- -
( )
(
)
Amounts owed by related parties represent expenses paid on behalf of the
non-controlling interest shareholders by the company and are expected to be
recovered in more than 12 months. The amounts are unsecured and interest free.
During the year provisions in respect of doubtful receivables of £331,000
were made in the accounts including £100,000 provided against amounts due
from Joint Ventures.
Credit risk
The Group's principal financial assets are bank balances, cash balances,
amounts due from joint ventures and other receivables. The Group's credit risk
is primarily attributable to its other receivables of which £Nil (2023 -
£107,000) is due from a third party financial institution and further
information is provided in note 22. The remaining other receivable relates to
recoverable VAT. The amounts presented in the balance sheet are net of
allowances for doubtful receivables.
18. Payables and contract
liabilities Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Trade payables
3,372
753
351 134
Taxation and social security costs
-
10
- 10
Other payables
5,052
4,852
9 5
Contract liabilities
-
195
- -
Amounts owed to joint ventures
-
21
- -
Accruals
451
193
450 118
( )
(
)
8,875
6,024
810 267
Due within 12 months
(4,541)
(1,862)
(810) (267)
( )
(
) Due after more than 12
months
4,334
4,162
- -
( )
(
)
Other payables includes £5,027,000 (R116,000,000) (2023 - £4,829,000
(R116,000,000)) in respect of the proposed Rustenburg smelter acquisition
which was unconditional at the year-end but which remained subject to
contract. On completion, £4,334,000 (R100,000,000) (2023 - £4,162,000
(R100,000,000)) will be due after 12 months with the remainder anticipated to
be due within 12 months.
Contract liabilities, representing deferred income, were £Nil at 1 July 2022
and £195,000 at 1 July 2023.
19. Leases
The Group has lease contracts for certain items of motor vehicles with lease
terms of six years. In addition, the Group uses short-term leases (less than
12 months term) where considered appropriate to its requirements and takes
advantage of the recognition exemptions for such leases.
Right-of-use assets
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Cost:
At 1 July
41
-
- -
Additions
-
47
- -
Exchange differences
2
(6)
- -
( )
(
)
At 30 June
43
41
- -
( )
(
)
Depreciation:
At 1 July
9
-
- -
Charge for the period
8
10
- -
Exchange differences
1
(1)
- -
( )
(
)
At 30 June
18
(9)
- -
( )
(
) Net book value at 30
June
25
32
- -
( )
(
)
Lease
liabilities
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
At 1 July
37
-
- -
Additions
-
47
- -
Interest expense
6
2
- -
Payments
(11)
(6)
- -
Exchange differences
5
(6)
- -
( )
(
)
37
37
- -
Due within 12 months
(11)
(10)
- -
( )
(
) Due after more than 12
months
26
27
- -
( )
(
)
Maturity analysis
Group
Company
2024
2023
2024 2023
£000
£000 £000
£000
On demand
-
-
- -
Within 1 year
11
10
- -
Between 1 to 2 years
11
10
- -
Between 2 to 5 years
27
30
- -
Over 5 years
-
6
- -
( )
(
)
Total undiscounted liabilities
49
56
- -
Future finance charges and
other adjustments
(12)
(19)
- -
( )
(
) Lease liabilities in the
financial statements
37
37
- -
( )
(
)
Amounts recognised in the income statement as an expense during the period in
respect of lease arrangements are as follows:
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Expense relating to short-term leases
43
32
- -
Depreciation
8
10
- -
Interest
6
2
- -
( )
20. Borrowings
Group
Company
2024
2023
2024 2023
£000
£000
£000 £000
Other loans
570
-
510 -
( )
( )
Due within 12 months
570
-
510 -
( )
(
) Due after more than 12
months
-
-
- -
( )
(
)
The others loans in the group and company represented amounts due of £510,000
to Tracarta Limited (in which John Wardle, Executive Chairman of the Company
has a beneficial interest). The loans attracted a fixed interest rate of 11%
and arrangement fees of £12k. On 15 October 2024 Tracarta Limited agreed to
capitalise their working capital loan, including interest, into
£1,541,666,666 New Ordinary Shares with the balance of interest repaid in
cash.
In addition other loans in the group included £60,000 (R1.4m) due to James
Allen. The loan does not attract interest and since the year end, the loan has
been fully repaid.
The financing of the group comprises the contingent consideration (note 18)
and the leases (note 19), both of which are detailed in their respective note.
21. Deferred tax
Group
2024 2023
£000 £000
At 1 July
3,284 4,730
Change in tax rates
- (157)
Relating to origination and reversal of temporary differences
192 (554)
Exchange differences
139 (735)
( )
At 30 June
3,615 3,284
(
)
The Group has unrelieved tax losses carried forward which represent a deferred
tax asset of £1,797,000 (2023 - £1,524,000) based on current tax rates. This
asset is not recognised in these financial statements.
The deferred tax liability is made up as follows:
Group
2024 2023
£000 £000
Exploration and evaluation
assets
3,933 3,777
Temporary timing difference on foreign exchange gains and losses
(318) (440)
Other temporary timing differences
- (53)
( )
3,615 3,284
(
)
22. Financial instruments
The Group's policies as regards derivatives and financial instruments are set
out in the accounting policies in note 2. The Group does not trade in
financial instruments.
Capital risk management
The Company and the Group manages its capital to ensure that they will be able
to continue as a going concern whilst maximising the return to stakeholders
through the optimisation of the debt and equity balance. The Group's overall
strategy remains unchanged from 2023.
The capital structure of the Group consist of equity attributable to equity
holders of the parent Company. The Company and the Group are not subject to
any externally imposed capital requirements.
Credit risk management
Credit risk refers to the risk that a counterparty will default on its
contractual obligations resulting in financial loss to the Company. The
Company and the Group have adopted a policy of only dealing with creditworthy
counterparties as a means of mitigating the risk of financial loss from
defaults. The Group's exposure and the credit ratings of its counterparties
are continuously monitored and the aggregate value of the transactions
concluded is spread where possible. Further information is provided in note
17.
Liquidity Risk Management
Ultimate responsibility for liquidity risk management rests with the Board of
Directors, which has established an appropriate liquidity risk management
framework for the management of the Company and the Group's short, medium and
long term funding and liquidity management requirements. The Company and the
Group manage liquidity risk by assessing required reserves and banking
facilities by continuously monitoring forecast and actual cash flows, and by
matching the maturity profiles of financial assets and liabilities. At the
year-end the Group has no undrawn bank facilities. The Company is in the
process of negotiating a significant funding transaction with a financial
institution in South Africa which is expected to be concluded during 2025.
The Company was in discussions with a financial institution in South Africa
regarding a funding transaction during the period. These discussions are still
ongoing, and at this stage, the process has been strategically paused. The
Company plans to resubmit updated information that more accurately reflects
the Company's strengthened position compared to the period prior to the
fundraise completed at the end of 2024. In light of the significant
investments made and ongoing since the fundraise, along with the overall
progress the Company has achieved, we believe our overall position is now
considerably stronger, positioning us well to secure this funding transaction
on favourable terms.
Interest rate risk profile
The Company and the Group is exposed to interest rate risk because the Group
borrows funds for working capital at fixed and variable rates. The Group
exposure to interest rates on financial assets and liabilities are detailed in
the liquidity risk management section of this note.
Financial assets
The Group has no financial assets, other than short-term receivables and cash
deposits of £4,000 (2023 - £19,000). The cash deposits attract variable
rates of interest. At the year-end the effective rate was 0.47% (2023 -
0.36%). The cash deposits held were as follows:-
2024 2023
£000 £000
Sterling - United Kingdom
banks
3 16
South African Rand - United Kingdom
banks
- 2
South African Rand - South African
banks
1 1
(
)
4 19
( )
Financial liabilities - maturity
The table below summarise maturity profile of the Group's financial
liabilities based on contractual undiscounted payments
Lease Trade and
Borrowings Liabilities other
£000 £000
£000
On demand
570
1 3,848
Less than three months
-
2 -
3 to 12 months
-
9 -
1 to 5 years
-
25 -
Greater than 5 years
-
- -
(
)
1 to 5 years
570
37 3,848
( )
( )
Lease Trade and
Liabilities other
£000 £000
On
demand
1 1,195
Less than three months
2 -
3 to 12
months
9 -
1 to 5
years
25 -
Greater than 5
years
- -
(
)
At 30 June
2023
37 1,195
( )
(
)
In addition to the above, financial liabilities include unconditional
acquisition costs for the Rustenberg Smelter of £5,027,000 (R116,000,000) as
disclosed in note 18. As the deal is unconditional then no contractual
liabilities exist at the year end. On completion, which is yet to be
determined but assumed to be within 12 months, £693,000 (R16,000,000) (2023 -
£667,000 (R16,000,000) is payable. The remainder of the consideration of
£4,334,000 (R100,000,000) (2023 - £4,162,000 (R100,000,000) will be due
after 12 months after completion of the acquisition.
Financial liabilities - Lease liabilities
Lease liabilities of £37,000 (2023 - £37,000) attract interest at a variable
rate of 2.49% above the First National Bank Prime lending rate which was
11.75% at the year end.
Sensitivity analysis - As the interest bearing liabilities are not
significant to the overall Group then an increase of 1% in interest rates in
South Africa at the balance sheet date would not have a significant effect on
the profit and loss of the group.
Currency exposures
The Group undertakes transactions denominated in foreign currencies and is
consequently exposed to fluctuations in exchange rates. The carrying amounts
of the Group's foreign currency denominated monetary assets and monetary
liabilities were as follows:-
As at 30 June 2024
Assets Liabilities
£000 £000
British Pound Sterling
(£)
3 1,320
USD ($)
- 1
South African Rand (R)
17 8,161
( )
(
)
20 9,482
( )
(
)
As at 30 June 2023
Assets Liabilities
£000 £000
British Pound Sterling
(£)
17 257
USD ($)
- 6
South African Rand (R)
258 5,594
( )
(
)
275 5,857
( )
(
)
( )
Financial commitments and guarantee
Rehabilitation guarantees of £1,205,000 (R 27,797,984) (2023 - £1,157,000 (R
27,797,984)) have been issued to the Department of Mineral Resources for three
subsidiaries, HW Iron Proprietary Limited, Lapon Mining Proprietary Limited
and Luge Prospecting and Mining Company Proprietary Limited in order to comply
with Section 41 of the Mineral and Petroleum Resources Development Act, 2002
(Act 28 of 2002). Under this agreement the Group will pay deposits to a
third-party financial institution to be held pending discharge of any
potential claim on this guarantee. At 30 June 2024 £117,000 (R 2,698,798)
(2023 - £107,000 (R 2,581,388)) had been deposited in respect of this
agreement but was provided against as a doubtful receivable in the year. As
the project had not yet commenced then no liability is considered to have
arisen under this guarantee at the reporting date.
23. Share capital
Group and Company
2024 2023
£000 £000
Allotted, called up and fully paid
3,934,996,887 (2023 - 3,574,996,887) Ordinary shares of 0.1p
each 3,934 3,574
322,447,158 (2023 - 322,447,158) deferred shares of 1p
each
3,224 3,224
5,894,917,569 (2023 - 5,894,917,569) deferred shares of 0.1p
each 5,896 5,896
( )
13,054 12,694
( )
(
)
On 14 November 2023, a further 162,000,000 ordinary shares were issued and
admitted to trading to raise gross working capital of £450,000 for the Group.
On 15 November 2023, a further 198,000,000 ordinary shares were issued and
admitted to trading to raise gross working capital of £550,000 for the Group.
Unlike ordinary shares, the deferred shares have no voting rights, no dividend
rights and on a return of capital or winding up are entitled to a return of
amounts credited as paid. The deferred shares are not transferrable and
beneficial interests in the deferred shares can be transferred to such persons
as the Directors may determine as custodian for no consideration without
sanction of the holder. For this reason the deferred shares are excluded from
any Earnings per share calculations.
Further information on the issue of shares after the period end is provided in
note 30.
Share options
The Company has a share option scheme for certain employees and former
employees of the Group. The share options in issue during the year were as
follows:
As at
As at
Date
Exercise 1 July
Granted Exercised
Lapsed/30 June
granted
price
2023 in year
in year Cancelled 2024
No. No.
No.
No. No.
7 November 2013
1p
2,086,667 -
-
(2,086,667) -
1 May 2014
1p 200,000
- -
(200,000) -(
) 1 October 2015
1p
2,500,000 -
-
- 2,500,000
10 January 2020
1p
27,400,000 -
-
(27,400,000) -
27 February 2023
0.3p
48,250,000 -
- (12,500,000)
35,750,000
(
)
At the year-end, 12,691,667 options were exercisable (2023 - 31,186,667) as
follows.
As
at
As at
Date
Exercise 30 June Change Exercised
Lapsed/ 30 June
granted
price
2023 in year in year
Cancelled 2024
No. No. No.
No.
No.
7 November 2013
1p
2,086,667-
-
(2,086,667) -
1 May 2014
1p 200,000
-
-
(200,000) -(
) 1 October 2015
1p 1,500,000
-
-
- 1,500,000
10 January 2020
1p
27,400,000
-
-
(27,400,000) -(
) 27 February 2023
1p -
11,191,667 -
- 11,191,667(
)
(
)
The exercise period of the options is as follows:
Date
granted
Expiry date Exercise period
16 April 2013
16 April
2023
*
7 November 2013 7
November 2023 *
1 May 2014
1 May
2024
*
1 October 2015
1 October
2025 *
10 January 2020 9
January 2030
**
27 February 2023 27
February 2033 *
Exercise period
* - 1/3 on the first anniversary of grant, 1/3 on the second anniversary of
grant and the final 1/3 on the third anniversary of grant.
** - ½ on grant and the remaining ½ one year after the grant date.
Of the options granted on 1 October 2015, 1,000,000 are exercisable following
first commercial production from the proposed 15 MW smelter.
The fair value of the share options granted on 23 February 2023 was estimated
at the date of grant using the Black Scholes model using the following inputs
to the model:-
Expected volatility
95%
Risk-free interest rate
4.18%
Expected vesting period of the share
options
1 to 3 years
Expected life of the share
options
10 years
The total estimated fair value of the options granted on 23 February 2023 was
£101,000 and the Group recognised a share-based payment expense of £48,000
(2023 - £11,000) in the year. No options were granted or exercised in the
year.
Share warrants
Pursuant to the share placing on 14 December 2020 Turner Pope were appointed
as joint broker to the Placing and in addition to 3,333,333 ordinary shares
were issued with 95,833,333 broker warrants, exercisable at 0.3p (the placing
price) for a period of 36 months from the date of admission. The broker
warrants were transferrable and on 4 March 2021 17,500,000 warrants were
exercised for £52,500. The remaining warrants expired in the period.
Pursuant to the loan facilities agreement, dated 19 May 2022, the Company
issued share warrants to the lenders over 13,000,000 shares at 1 pence per
share. The warrants had a 3 years life and the lender was able to use the
outstanding balances under the loan facilities to exercise the warrants. The
loans were repaid in the previous period. In accordance with the agreement,
the price was adjusted downwards to the subsequent placing price of 0.3p per
share and at the year-end, there remained 13,000,000 lender warrants in issue.
Pursuant to the share placing on 2 August 2022 Turner Pope were appointed as
sole broker to the Placing and were issued with 375,000,000 broker warrants,
exercisable at 0.3p (the placing price) for a period of 3 years from the date
of admission. At the year-end, there were 375,000,000 broker warrants in
issue.
Pursuant to the share placing in March 2023, the Company issued to subscribers
to the Placing with warrants to subscribe for new ordinary shares on the basis
of one (1) warrant for every two (2) Placing Shares. The investor warrants are
exercisable at 0.50 pence for a period of two years from the date of their
grant. At the year end, there were 333,333,333 investor warrants in issue. In
addition, the Company issued TPI, the sole broker to the Placing, with
135,000,000 broker warrants, exercisable at 0.3p (the placing price) for a
period of three years from the date of admission. At the year-end, there were
135,000,000 broker warrants in issue.
Pursuant to the share placing in November 2023, the Company issued to
subscribers to the Placing with warrants to subscribe for new ordinary shares
on the basis of one (1) warrant for every one (1) Placing Shares. The investor
warrants are exercisable at 0.29 pence for a period of three years from the
date of their grant. At the year end, there were 360,000,000 investor warrants
in issue.
Following the year-end, pursuant to the share placing in November 2023, the
Company issued to subscribers to the Placing with warrants to subscribe for
new ordinary shares on the basis of one (1) warrant for every one (1) Placing
Shares. The investor warrants over 9,807,092,461 shares are exercisable at
0.072 pence for a period of three years and the Broker warrants over
694,444,444 shares are exercisable at 0.036 pence for a period of 5 years.
24. Reserves
Group and Company
Other reserves represent the equity component of share options and share
warrants issued in the year.
The balance classified as share premium is the premium on the issue of the
Group's equity share capital, less any costs of issuing the shares.
The foreign currency translation reserve accumulates the foreign currency
gains and losses on the translation of foreign operations.
Retained earnings is made up of cumulative profits and losses to date, share
based payments, adjustments arising from changes in non-controlling interests
and exchange differences on translation of foreign operations.
25. Cash used in operations
Group
2024 2023
£000 £000
Operating loss
(1,141) (1,236)
Depreciation on property, plant and
equipment
18 17
Share based payment charge
25 11
Foreign exchange
(17) (117)
Loan to Joint venture -
provision
97 -
( )
(
) Operating cash flows before movements in working
capital
(1,018) (1,325)
Movement in inventories
5 (51)
Movement in receivables
199 (203)
Movement in payables and contract
liabilities
509
907( )
(
)
Cash used in
operations
(305) (672)
( )
(
) Cash and cash equivalents
2024 2023
£000 £000
Cash and bank
balances
4 19
( )
Company
2024 2023
£000 £000
Operating loss
(866) (911)
Share based payment charge
- 3
( )
(
)
Operating cash flows before movements in working
capital (866)
(908)
Movement in receivables
40 (45)
Movement in payables
493 (147)
( )
(
)
Cash used in
operations
(333) (1,100)
( )
Cash and cash equivalents
2024 2023
£000 £000
Cash and bank
balances
3 17
( )
26. Significant non-cash transactions
The company settled liabilities and paid for services by the issue of shares.
The value of the shares issued was as follows:-
2024 2023
£000 £000
Loan
repayments
- 360,000
Accrued directors
fees
- 192,000
Services
provided
- 45,000
( )
( )
27. Related party transactions
Group
During the year the Group incurred £84,886 (2023 - £134,000) for consultancy
services to Goldline Global Consulting (Pty) Limited, a company in which P Cox
is materially interested. At 30 June 2024, £Nil (2023 - £Nil) remained
unpaid in accruals.
Group and Company
The key management personnel of the Group are the directors. Directors'
remuneration is disclosed in Note 6.
During the year the Company paid £60,000 (2023 - £59,000) for accounting
services to Westleigh Investments Limited, a company in which G Clarke and N
Harrison are materially interested.
Included in other loans at 30 June 2024 was a short term working capital loans
of £510,000 (2023 - £Nil) due to Tracarta Limited (in which John Wardle,
Executive Chairman of the Company has a beneficial interest). The loan
attracted interest at 11% per annum and a loan arrangement fee of 2.5% of the
facility amount.
Further directors' remuneration of £231,000 (2023 - £12,000) was unpaid at
the year-end and is included in accruals. During the year £Nil (2023 - £
192,000) of director's fees were settled by the issue of shares.
28. Financial commitments
At the year-end the Group had no financial commitments under operating leases
(2023 - £Nil).
On 24 May 2022, the Group announced that it had signed Heads of Terms to
acquired 100% of the share capital of Ferrochrome Furnaces (Pty) Limited
("FCF") which will provide the Group with an existing smelting facility and
the opportunity to commence mining and processing in the short term. The share
capital was to be acquired for a nominal fee but debt was to be acquired of
R116m (approximately £5m) repayable over a 10 year period. At the year-end
the acquisition was unconditional but remained subject to contract and the
R116m is accrued in these financial statements. The Group commenced plans
during the Period to bring the smelter back in to production with overall
costs estimated to be R48m (£2.1m).
29. Non-controlling interest
2024 2023
£000 £000
(
) At 1 July
2,748 3,344
Exchange adjustments
114 (572)
Share of profit/(loss) for the
period
(14) (24)
( )
(
)
At 30 June
2,848 2,748
( )
(
)
The table below shows details of non-wholly owned subsidiaries of the Group
that have material non-controlling interests:
Profit/ (loss)
Proportion
of allocated
to
Accumulated
voting
rights
non-controlling
non-controlling
and shares
held
interests
interests
2024
(2023) 2024
2023
2024 2023
£000 £000
£000 £000
HW Iron (Proprietary) (32%)
(32%) -
14
932 896
Limited
Lapon Mining (26%) (26%)
(50)
6
1,930 1,903
(Proprietary) Limited
Other non-controlling interests
36
(44)
(14) (51)
(
)
(14) (24)
2,848 2,748
(
)
Summarised financial information in respect of each of the Group's
subsidiaries that have material non-controlling interests is set out below.
The summarised financial information below represents amounts before
intragroup eliminations. The accounts of the subsidiaries have been translated
from their presentational currency of South African Rand (R) using the R: GBP
exchange rate prevailing at 30 June 2024 of 23.075 (2023 - 24.023).
HW Iron (Proprietary) Limited
2024 2023
£000 £000
Non-current assets
6,437 6,011
Current assets
5 5
Current liabilities
(63) (5)
Non-current liabilities
(3,466) (3,212)
( )
(
)
2,913 2,799
( )
(
)
Equity attributable to owners of the Company
1,981 1,903
Non-controlling
interest
932 896
( )
Revenue
- -
Expenses
- (1)
Tax
- 43
( )
(
)
Profit/(loss) for the
year
-
42
( )
(
)
Attributable to the owners of the
Company
- 28
Attributable to the non-controlling
interests
- 14
( )
Net cash (outflow)/inflow from operating
activities
56 (1)
Net cash outflow from investing
activities
(175) (317)
Net cash inflow from financing
activities
119 318
( )
(
)
Net cash inflow
-
-
( )
(
)
Net cash flow - Attributable to the non-controlling
interests
- -
( )
Lapon Mining (Proprietary) Limited
2024 2023
£000 £000
Non-current assets
12,839 12,248
Current assets
9 10
Current liabilities
(290) (172)
Non-current liabilities
(5,136) (4,768)
( )
(
)
7,422 7,318
( )
(
)
Equity attributable to owners of the
Company
5,492 5,415
Non-controlling
interest
1,930
1,903
( )
Revenue
- 18
Expenses
(194) (108)
Tax
- 114
( )
(
)
Profit/(loss) for the
year
(194) 24
( )
(
)
Attributable to the owners of the
Company
(144) 18
Attributable to the non-controlling
interests
(50) 6
( )
Net cash inflow from operating
activities
1 91
Net cash outflow from investing
activities
(200) (446)
Net cash inflow from financing
activities
200 355
( )
(
)
Net cash flow
1 -
( )
(
)
Net cash flow - Attributable to the non-controlling
interests
- -
( )
30. Events arising after the reporting period
On 20 November 2024 details of a capital re-organisation were approved whereby
each Existing Ordinary share was subdivided into one New Ordinary Share of
0.01 pence and nine Deferred Shares of 0.01 pence.
On 30 October 2024 the Company announced a proposed fundraising and capital
re-organisation and on 20 November 2024 confirm that the placing, subscription
and capital re-organisation had been approved. Under the placing and
subscription 6,944,444,444 New Ordinary shares were issued at a price of 0.036
pence per share raising gross proceeds of £2.5m. In addition, 2,862,647,017
New Ordinary Shares were issued at 0.036 pence in settlement of certain loan
facilities, creditors and Directors salaries. Finally, Investor Warrants were
issued to the recipients of the New Ordinary Shares pursuant to the
transaction on a 1 for 1 basis, with each investor Warrant exercisable at
0.072 pence for a period of three years.
The fundraise will provide the capital required for Ironveld to advance its
key strategic initiatives and unlock the significant value inherent in its
assets. The Board believes that the current market capitalisation does not
accurately reflect the true potential of the Company's assets, and the new
funds will enable the Company to continue driving forward on several fronts,
including:
· Completion of essential upgrades at the smelter complex to
achieve profitable production capacity.
· Progression towards revenue generation and cash flow positivity,
anticipated by end of Q2 2025.
· Establishing Ironveld as the first producer of high-purity
water-atomised iron in the Southern Hemisphere, opening new market
opportunities.
· Capitalising on our significant untapped asset value, which
remains under appreciated in the current market valuation.
Ironveld has long-term, renewable Mining Licenses extending to 2045 and 2047,
with a range of potential revenue streams from HPI, vanadium, and titanium
products. In addition, the Company is also actively exploring new
opportunities to diversify its asset portfolio, ensuring long-term growth and
value creation.
The Company will maintain its focus on operational improvements and the
production of high-quality coarse and water-atomised HPI powders. These
efforts are designed to generate revenue, achieve profitability, and
ultimately deliver long-term growth and increased shareholder value.
31. Control
The Directors consider that there is no overall controlling party.
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