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REG - Keras Resources PLC - Interim Results

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RNS Number : 0668O  Keras Resources PLC  29 September 2023

29 September 2023

 

Keras Resources plc ('Keras' or the 'Company')

 Interim Results

 

Keras Resources plc (AIM: KRS) announces its half year results for the six
months ending 30 June 2023.

 

Overview

 

·    Loss reduced to £255,000 and revenue increased to £397,000 compared
to the six-month period ended 30 June 2022 of £467,000 and £212,000
respectively;

·    Sales of 2,196 tons compared to the six-month period ended 30 June of
2022 of 1,896 tons;

·    2023 mining season has commenced with processing at the Spanish Fork
plant ongoing; and

·    Significant interest from fertiliser blenders who have now
successfully completed testwork on the high-grade Diamond Creek rock
phosphate.

 

 

Graham Stacey, Keras Chief Executive Officer, commented, "It was a tough start
to the year with record snowfall and an unpredictably long Utah winter,
exacerbated by a late spring and widespread heavy rains and flooding
throughout the Central California Valley where the majority of our customers
are located.  That said we believe we are in a strong position to now gear-up
on the back of the marketing drive over the past year, which has resulted in
significant interest and positive testwork from third party fertiliser
blenders and producers. I think it is important to note that creating markets
for our product, which in essence is convincing a farm to change its modus
operandi, takes time but once that change is made that market has longevity.
As mentioned in the Chairman's review we have had significant positive results
in the testwork undertaken by third party organic fertiliser companies eager
to use our rock phosphate in their blends and look forward to updating our
shareholders in the near future about potential long-term offtakes or joint
ventures.  To that end, we will provide guidance towards the end of the
fourth quarter for production and sales figures for 2024."

 

The information contained within this Announcement is deemed by the Company to
constitute inside information as stipulated under Article 7 of the Market
Abuse Regulation (EU) No. 596/2014 (as amended) as it forms part of the
domestic law of the United Kingdom by virtue of the European
Union (Withdrawal) Act 2018 (as amended). Upon the publication of this
Announcement via the Regulatory Information Service, this inside information
is now considered to be in the public domain.

 

 Graham Stacey                          Keras Resources plc             graham@kerasplc.com (mailto:graham@kerasplc.com)

 Ewan Leggat / Charlie Bouverat         SP Angel Corporate Finance LLP  +44 (0) 20 3470 0470

 Nominated Adviser & Joint Broker

 Joint Broker                           Shard Capital Partners LLP      +44 (0) 207 186 9900

 Damon Heath / Erik Woolgar

CHAIRMAN'S REVIEW

FOR THE SIX MONTHS ENDED 30 JUNE 2023

 

I am pleased to provide an update on our progress since the last report and to
set out our outlook for the business going forward.

 

2023 has been a transformative year for Keras with the unbundling of our
investment interest in the Nayéga manganese mine in northern Togo and the
focus on becoming the pre-eminent high grade organic phosphate producer in
North America.

 

The Diamond Creek phosphate mine

 

The Diamond Creek phosphate mine, which is believed to be one of the highest
grade organic rock phosphate deposits in the US, comprises an opencast
operation located on an 840 acre Federal Lease located approximately 80km
south-east of Salt Lake City, Utah.  Our focus going forward is to build the
operation into the premier high-grade organic phosphate producer in the US.

 

Our target market is the sustainable, organic agriculture sector and we are
strong advocates for the benefits of enhancing soil health and reducing the
impact that synthetic fertilisers have on water resources. Our organic
phosphate fertilizer products help farmers realise better crop growth without
sacrificing yields, and reduces the soil degradation seen when farmers use
chemically manufactured fertilisers, while at the same time reducing the
carbon footprint associated with growing their crops.

 

Sales for the first six months of 2023 were 2,192 tons sold, compared to the
first six months of 2022 of 1,896 tons. Year to date sales total 3,467 tons.
The lower than expected first half sales volume were a result of an extended
Utah winter and flooding throughout the Central California Valley which
impacted several key clients. High producer price inflation in the US also
impacted on buying patterns of organic fertilizer feedstocks as aggregators
and blenders preferred to preserve cash rather than build fertilizer stocks as
cost pressures impacted their own operations.

 

Mining has commenced, later than initially planned as a result of both cash
flow and inventory management which is a priority. Given our existing saleable
inventory, mining for the 2023 season, between now and end-November will be
between 2,500 and 4,000 tons dependent on offtake commitments from
customers.  Although sales for the first half of the year were below
expectations, we are confident that these will pick up in the fourth quarter
as seen during the same period in 2022.  In addition to our own sales of dry
crushed and milled product we have now seen a significant interest in organic
fertiliser blenders who have now undertaken testwork on our high-grade
phosphate rock to be incorporated in their blends.  The results of this
testwork have been positive and we look forward to updating shareholders once
commercial terms have been agreed.  As a company we believe that longer term
offtakes with fertiliser blenders will form a significant proportion of our
sales going forward.

 

Togo

 

In May 2023 the Company announced an agreement with the Republic of Togo (the
"State") on a way forward for the Nayéga Manganese project ("Nayéga") in
Northern Togo.  Keras and the State agreed that Nayéga is a Togolese
strategic asset and the exploitation permit will be awarded to Société
Togolaise de Manganèse, a Togolese incorporated company 100% owned by the
State ("STM") and Keras will no longer pursue the Nayéga exploitation permit.

 

The State paid Keras a cash consideration of US$1.7m (one million seven
hundred thousand United States dollars)  on 17 July 2023 and thereafter:

 

·    Keras will be paid an advisory fee of 1.5% (one and a half percent)
of gross revenue generated from the Nayéga mine for the provision of advisory
services for 3 (three) years; and

·    Keras will be paid 6.0% (six percent) of gross revenue generated from
the Nayéga mine for the provision of brokerage services for the lesser of 3.5
(three and a half) years or 900,000 (nine hundred thousand) tonnes of
beneficiated manganese ore produced and sold from Nayéga.

 

Since the agreement was signed in May, the Company and State have had positive
discussions regarding the development of Nayéga.  This process continues and
the Company believes that the continued constructive dialogue between the
Company and the State will stand the project in good stead, and we look
forward to updating shareholders on the way forward.

 

Financial review

 

The results for the 6 months ended 30 June 2023 show a loss of £255,000
compared to the six-month period ended 30 June 2022 of £467,000.  The
reduced loss was due to increased revenue of £397,00 (2022: £212,000) and a
profit on sale of intellectual property of £184,000.

 

On 13 April 2023 Chris Grosso from Kershner Grosso & Co. ('Kershner
Grosso'), a Saratoga Springs, New York State based Investment Advisor acquired
First Uranium Resources Ltd's (CSE: URNM) (KMMIF:OTC) ('First Uranium') entire
holding of 8,000,000 ordinary shares of 1 pence each in the Company ("Ordinary
Shares") representing 10% of the Company's issued share capital.  Subsequent
to his initial investment he has increased his holding to 15.64%. The Keras
Board is very pleased to have Kershner Grosso on board as a cornerstone
shareholder. Kershner Grosso's investment philosophy is very much aligned with
Keras's growth strategy in the US and the relationship is expected to provide
access to new markets and opportunities throughout North America.

 

On 4 July 2023 the Company announced receipt of the US$1.7m cash
consideration from the Republic of Togo and made cash payments of US$800,000,
being part of the consideration for the acquisition of Falcon Isle Resources
LLC Falcon Isle Holdings LLC ("Falcon Isle"), and US$240,000, being part of a
severance payment to the former CEO of Falcon Isle which totalled US$340,000.

 

Outlook

 

Although it has been a tough first half of the year, the Company remains very
positive about both the future of Diamond Creek and the fertiliser market
macro-economic conditions that underpin its future.  We are mining an
essential resource that can create value, be part of the greener economy and
contribute to a more sustainable future. As a mining company we remain ever
conscious of our obligations and commitments in line with best environmental,
social and governance ("ESG") practice and will continue to take the
initiative within this area.

 

I would like to thank our shareholders for their ongoing support and I look
forward updating all stakeholders as we continue to build Keras and Diamond
Creek into the premier organic phosphate producer in the US.

 

 

Russell Lamming

Chairman

 CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 FOR THE SIX MONTHS ENDED 30 JUNE 2023

                                                                                                                      6 months to 30-Jun-23         6 months to   30-Jun-22        12 months to 31-Dec-22

                                                                                                                      (unaudited)                   (unaudited)                    (audited)

                                                                                                                      £'000                         £'000                          £'000

 Revenue                                                                                                                           397              212                            994
 Cost of production                                                                                                                (44)             (104)                          (263)
 Gross profit/loss                                                                                                                 353              108                            731
 Profit on sale of intellectual property relating to Togo                                                             184                           -                              -
 Administrative expenses                                                                                              (686)                         (550)                          (1,524)
 Loss from operating activities                                                                                       (149)                         (442)                          (793)
 Finance income                                                                                                       -                             -                              -
 Finance costs                                                                                                        (106)                         -                              (204)
 Net finance costs                                                                                                    (106)                         (25)                           (204)
 Loss before taxation                                                                                                 (255)                         (467)                          (997)
 Taxation                                                                                                             -                             -                              -
 Loss for the period                                                                                                  (255)                         (467)                          (997)

 Other comprehensive income - items that may be subsequently reclassified to
 profit or loss
 Exchange translation on foreign operations                                                                           29                            53                             150
 Total comprehensive loss for the period                                                                              (226)                         (414)                          (847)

 Loss attributable to:
 Owners of the Company                                                                                                (255)                         (470)                          (1,076)
 Non-controlling interests                                                                                            -                             3                              79
 Loss for the period                                                                                                  (255)                         (467)                          (997)

 Total comprehensive loss attributable to:
 Owners of the Company                                                                                                (226)                         (414)                          (907)
 Non-controlling interests                                                                                            -                             -                              60
 Total comprehensive loss for the period                                                                              (226)                         (414)                          (847)

 Earnings per share
 Basic and diluted loss per share (pence)                                                                             (0.28)                        (0.015)                        (1.148)

 

The notes are an integral part of this condensed consolidated interim
financial report.

 

 

 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 AS AT 30 JUNE 2023

                                                                30-Jun-23         30-Jun-22             31-Dec-22

                                                                (unaudited)       (unaudited)           (audited)

                                                    Notes       £'000             £'000                 £'000
 Assets
 Non-current assets
 Intangible assets                                  7           3,418             4,875                 3,558
 Property, plant and equipment                      8           372               591                   381
 Right of use asset                                 9           59                185                   121
                                                                3,849             5,651                 4,060

 Current assets
 Inventory                                          10          660               484                   668
 Trade and other receivables                        11          1,612             115                   191
 Assets held for sale                                           -                 -                     1,558
 Cash and cash equivalents                                      39                440                   207
                                                                2,311             1,039                 2,624

 Total assets                                                   6,160             6,690                 6,684

 Equity
 Equity attributable to owners of the Company
 Share capital                                      12          797               798                   797
 Share premium                                      12          5,838             5,838                 5,838
 Other reserves                                                 311               173                   282
 Retained deficit                                               (3,245)           (2,885)               (2,990)
                                                                3,701             3,924                 3,927
 Non-controlling interests                                      (146)             (133)                 (146)
 Total equity                                                   3,555             3,791                 3,781

 Liabilities
 Current liabilities
 Trade and other payables                           13          1,478             1,423                 1,158
 Liabilities held for sale                                      -                 -                     471
 Lease liabilities - current                        9           61                120                   126
                                                                1,539             1,543                 1,755
 Non-current liabilities
 Trade and other payables                           13          1,066             1,293                 1,148
 Lease liabilities - non-current                    9           -                 63                    -
                                                                1,066             1,356                 1,148
 Total liabilities                                              2,605             2,899                 2,903

 Total equity and liabilities                                   6,160             6,690                 6,684

 

 

The notes are an integral part of this condensed consolidated interim
financial report.

 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 FOR THE SIX MONTHS ENDED 30 JUNE 2023

                                                                                                                      Share option/

                                                                                                                      warrant reserve                                    Retained earnings/ (deficit)                   Non-controlling interests

                                                                 Share capital £'000           Share premium          £'000                    Exchange reserve          £'000                                          £'000                                Total

                                                                                               £'000                                           £'000                                                       Total                                             equity

                                                                                                                                                                                                           £'000                                             £'000

 Balance at 1 January 2023 (audited)                             797                           5,838                  102                      180                                        (2,990)                3,927                  (146)                3,781

 Loss for the period                                             -                             -                      -                        -                                          (255)                  (255)                  -                    (255)
 Other comprehensive income                                      -                             -                      -                        29                                         -                      29                     -                    29
 Total comprehensive loss for the period                                                       -                      -                        29                                         (255)                  (226)                  -                    (226)

 Issue of ordinary shares                                        -                             -                      -                        -                                          -                      -                      -                    -
 Issue costs                                                     -                             -                      -                        -                                          -                      -                      -                    -
 Non-controlling interest on acquisition of subsidiary

                                                                 -                             -                      -                        -                                          -                      -                      -                    -
 Share based payment transactions                                -                             -                      -                        -                                          -                      -                      -                    -
 Transactions with owners, recognised directly in equity         -                             -                      -                        -                                          -                      -                      -                    -

 Balance at 30 June 2023 (unaudited)                             797                           5,838                  102                      209                                        (3,245)                3,701                  (146)                3,555

 

The notes are an integral part of this condensed consolidated interim
financial report.

 

 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 FOR THE TWELVE MONTHS ENDED 31 DECEMBER 2022

                                                                                                            Share option/

                                                                                                            warrant reserve                                                                           Non-controlling interests

                                                                Share capital         Share premium         £'000                   Exchange reserve         Retained                                 £'000                               Total

                                                                £'000                 £'000                                         £'000                    Earnings/ (deficit)       Total                                              equity

                                                                                                                                                             £'000                     £'000                                              £'000

 Balance at 1 January 2022 (audited)                            630                   4,033                 100                     11                                    (1,721)            3,053                    229                 3,282

 Loss for the period                                            -                     -                     -                       -                                     (1,076)            (1,076)                  79                  (997)
 Other comprehensive income                                     -                     -                     -                       169                                   -                  169                      (19)                150
 Total comprehensive loss for the period                        -                     -                     -                       169                                   (1,076)            (907)                    60                  (847)

 Issue of ordinary shares                                       167                   1,845                 -                       -                                     -                  2,012                    -                   2,012
 Costs of share issue                                           -                     (40)                  -                       -                                     -                  (40)                     -                   (40)
 Acquisition of non-controlling interest                        -                     -                     -                       -                                     (200)              (200)                    (435)               (635)
 Share option expense                                           -                     -                     9                       -                                     -                  9                        -                   9
 Share option forfeit                                           -                     -                     (7)                     -                                     7                  -                        -                   -
 Transactions with owners, recognised directly in equity        167                   1,805                 2                       -                                     (193)              1,781                    (435)               1,346

 Balance at 31 December 2022 (audited)                          797                   5,838                 102                     180                                   (2,990)            3,927                    (146)               3,781

 

The notes are an integral part of this condensed consolidated interim
financial report.

 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 FOR THE SIX MONTHS ENDED 30 JUNE 2022

                                                                                                                Share option/

                                                                                                                warrant reserve                                                                          Non-

                                                                  Share capital          Share premium          £'000                    Exchange reserve          Retained earnings                     controlling interests           Total

                                                                  £'000                  £'000                                           £'000                     £'000                   Total         £'000                           equity

                                                                                                                                                                                           £'000                                         £'000

 Balance at 1 January 2022 (audited)                              630                    4,033                  100                      11                                    (1,721)           3,053                 229               3,282

 Loss for the period                                              -                      -                      -                        -                                     (470)             (470)                 3                 (467)
 Total other comprehensive income                                 -                      -                      -                        56                                    -                 56                    (3)               53
 Total comprehensive loss for the period                          -                      -                      -                        56                                    (470)             (414)                 -                 (414)

 Issue of ordinary shares                                         168                    1,845                  -                        -                                     -                 2,013                 -                 2,013
 Issue costs                                                      -                      (40)                   -                        -                                     -                 (40)                  -                 (40)
 Acquisition of NCI without a change in control (note 14)

                                                                  -                      -                      -                        -                                     (694)             (694)                 (362)             (1,056)
 Share based payment transactions                                 -                      -                      6                        -                                     -                 6                                       6
 Transactions with owners, recognised directly in equity          168                    1,805                  6                        -                                     (694)             1,285                 (362)             923

 Balance at 30 June 2022                                          798                    5,838                  106                      67                                    (2,885)           3,924                 (133)             3,791

  (unaudited)

 

The notes are an integral part of this condensed consolidated interim
financial report.

 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

 FOR THE SIX MONTHS ENDED 30 JUNE 2023

                                                                                              30-Jun-23         30-Jun-22             31 -Dec-22

                                                                                              (unaudited)       (unaudited)           (audited)

                                                                                              £'000             £'000                 £'000

 Cash flows from operating activities
 Loss from operating activities                                                               (226)             (467)                 (997)
 Adjustments for:
 Depreciation and amortisation                                                                61                99                    179
 Profit on sale of intellectual property relating to Togo                                     (184)             -                     -
 Expenses settled in shares                                                                   -                 -                     109
 Finance costs recognised                                                                     106               -                     204
 Foreign exchange differences                                                                 -                 (356)                 -
 Equity-settled share-based payment transactions                                              -                 6                     9
                                                                                              (243)             (718)                 (496)
 Changes in:
 - inventories                                                                                8                 (211)                 (395)
 - trade and other receivables                                                                (8)               (21)                  (97)
 - trade and other payables                                                                   116               (747)                 119
 Cash used in operating activities                                                            (127)             (1,697)               (869)

 Interest paid                                                                                (9)               -                     (52)
 Net cash used in operating activities                                                        (136)             (1,697)               (921)

 Cash flows from investing activities
 Interest received                                                                            -                 -                     -
 Acquisition of property, plant and equipment                                                 -                 -                     -
 Exploration and licence expenditure                                                          -                 (2)                   -
 Consideration for purchase of minority interest in subsidiary                                -                 -                     (286)
 Net cash used in investing activities                                                        -                 (2)                   (286)

 Cash flows from financing activities
 Net proceeds from issue of share capital                                                     -                 1,973                 1,641
 Loans received                                                                               -                 -                     100
 Repayment of loans                                                                           -                 -                     (375)
 Payment of lease obligations                                                                 (61)              -                     (93)
 Net cash flows from financing activities                                                     (61)              1,973                 1,273

 Net (decrease)/increase in cash and cash equivalents                                         (197)             274                   66
 Cash and cash equivalents at beginning of period                                             207               166                   166
 Effect of foreign exchange rate changes                                                      29                -                     (25)
 Cash and cash equivalents at end of period                                                   39                440                   207

 

 

The notes are an integral part of this condensed consolidated interim
financial report.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS

FOR THE SIX MONTHS ENDED 30 JUNE 2023

 

1.             Reporting entity

Keras Resources plc (the "Company") is a company domiciled in England and
Wales.  The unaudited condensed consolidated interim financial statements of
the Company as at and for the six months ended 30 June 2023 comprise the
Company and its subsidiaries (together referred to as the "Group") and the
Group's interests in associates and jointly controlled entities.  The Group
currently operates as an explorer and developer.

 

2.             Basis of preparation

 

(a)           Statement of compliance

This condensed consolidated interim financial report has been prepared in
accordance with IAS 34 Interim Financial Reporting. Selected explanatory notes
are included to explain events and transactions that are significant to an
understanding of the changes in financial performance and position of the
Group since the last  consolidated financial statements as at and for the
period ended 31 December 2022.  This condensed consolidated interim financial
report does not include all the information required for full annual financial
statements prepared in accordance with International Financial Reporting
Standards.

 

This condensed consolidated interim financial report was approved by the Board
of Directors on 27 September 2023, subject to certain amendments that were
delegated to and approved by a Director on 29 September 2023.

 

(b)           Judgements and estimates

Preparing the interim financial report requires Management to make judgements,
estimates and assumptions that affect the application of accounting policies
and the reported amounts of assets and liabilities, income and expense.
Actual results may differ from these estimates.

 

In preparing this condensed consolidated interim financial report, significant
judgements made by Management in applying the Group's accounting policies and
key sources of estimation uncertainty were the same as those that applied to
the audited consolidated financial statements as at and for the period ended
31 December 2022.

 

3.             Significant accounting policies

The accounting policies applied by the Group in this condensed consolidated
interim financial report are the same as those applied by the Group in its
audited consolidated financial statements as at and for the period ended 31
December 2022.

 

4.             Financial instruments

 

Financial risk management

The Group's financial risk management objectives and policies are consistent
with those disclosed in the audited consolidated financial statements as at
and for the period ended 31 December 2022.

5.             Segment information

The Group considers that it operates in two distinct business areas, manganese
mining in West Africa and phosphate mining in Utah, USA.  These business
areas form the basis of the Group's operating segments.  For each segment,
the Group's CEO (the chief operating decision maker) reviews internal
management reports on at least a quarterly basis.

 

Operations ceased in the manganese segment of the Group during the period.
This was a result of the sale of the intellectual property relating to this
geographic region. As a result, an amount of £1,412,077 is recognised within
other receivables reflecting the amounts due on the sale and an amount of
£184,653 recognised as a gain on disposal within operating profit.

 

Other operations relate to the group's administrative functions conducted at
its head office and by its intermediate holding company together with
consolidation adjustments.

 

Information regarding the results of each reportable segment is included
below.  Performance is measured based on segment profit before tax, as
included in the internal management reports that are reviewed by the Group's
CEO.  Segment results are used to measure performance as Management believes
such information is the most relevant in evaluating the performance of certain
segments relative to other entities that operate within the exploration
industry.

 

Information about reportable segments

 

For the six months ended 30 June 2023 (unaudited)

 

                                                                                  Other operations£'000

                                        Manganese£'000            Phosphate                                   Total

                                                                  £'000                                       £'000

 External revenue                       -                         397             -                           397

 Profit/(loss) before tax               -                         141             (396)                       (255)

 Segment assets                         -                         4,689           1,471                       6,160

 For the six months ended 30 June 2022 (unaudited)

                                                                                  Other operations£'000

                                        Manganese£'000            Phosphate                                   Total

                                                                  £'000                                       £'000

 External revenue                       -                         212             -                           212

 Profit/(loss) before tax               22                        9               (498)                       (467)

 Segment assets                         1,228                     4,744           718                         6,690

 5.       Segment information (continued)

 For the twelve months ended 30 December 2022 (audited)

                                                                                  Other operations

                                        Manganese                 Phosphate       £'000                       Total

                                        £'000                     £'000                                       £'000

 External revenue                       -                         994             -                           994

 Profit/(loss) before tax               (131)                     68              (934)                       (997)

 Segment assets                         1,558                     5,027           99                          6,684

Information about geographical segments:

 

For the six months ended 30 June 2023 (unaudited)

 

                                           West                 US              Other operations£'000             Total

                                           Africa

                                           £'000                £'000                                             £'000
 External  revenue                         -                    397             -                                 397

 Profit/(loss) before tax                  -                    141             (396)                             (255)

 Segment assets                            -                    4,689           1,471                             6,160

        For the six months ended 30 June 2022 (unaudited)

                                           West                 US              Other operations£'000             Total

                                           Africa

                                           £'000                £'000                                             £'000
 External  revenue                         -                    212             -                                 212

 Profit/(loss) before tax                  22                   9               (498)                             (467)

 Segment assets                            1,228                4,744           718                               6,690

 5

        Segment information (continued)

         Information about geographical segments(continued)

        For the 12 months ended 31 December 2022 (audited)

                                           West                 US              Other operations                  Total

                                           Africa                               £'000

                                           £'000                £'000                                             £'000

 External revenue                          -                    994             -                                 994

 Profit/(loss) before tax                  (131)                68              (934)                             (997)

 Segment assets                            1,558                5,027           99                                6,684

6.            Seasonality of operations

Mining at Falcon Isle takes place between May and November due to winter snow
cover at the mine site and on the approach road. The fertiliser produced is
used primarily during the planting and growing seasons, but sales by Falcon
Isle take place throughout the year.

 

7.             Intangible assets

                                                            30-Jun-23         30-Jun-22             31-Dec-22

                                                            (unaudited)       (unaudited)           (audited)

                                                            £'000             £'000                 £'000

 Cost
 Balance at beginning of period                        3,613                  4,643                 4,643
 Additions                                             -                      3                     -
 Effect of movement in exchange rates                  (145)                  298                   349
 Transfers to assets held for sale                     -                      -                     (1,379)
 Balance at end of period                              3,468                  4,944                 3,613

 Impairment losses
 Balance at beginning of period                        55                     37                    37
 Impairment                                            -                      26                    -
 Amortisation                                          -                      -                     13
 Disposals                                             -                      -                     -
 Effect of movement in exchange rates                  (5)                    6                     5
 Balance at end of period                              50                     69                    55

 

 Carrying amounts
 Balance at end of period        3,418    4,875      3,558
 Balance at beginning of period  3,558    4,606      4,606

Intangible assets comprise the fair value of prospecting and exploration
rights.

8.             Property, plant and equipment

Acquisitions and disposals

 

No assets were acquired or disposed of during the six months ended 30 June
2023 or the comparative period.

 

 

9.             Right of use asset

 

                                                         30-Jun-23         30-Jun-22             31-Dec-22

                                                         (unaudited)       (unaudited)           (audited)
                                                         £'000             £'000                 £'000
 Balance at beginning of period                          121               215                   215
 Additions                                               -                 -                     -
 Depreciation                                            (59)              (66)                  (118)
 Effects of movements in exchange rates                  (3)               36                    24
                                                         59                185                   121

 

                Lease liability

 

                                         £'000     £'000           £'000
 Balance at beginning of period          126       219             219
 Principal reduction                     (61)      (64)            (93)
 Finance cost                            2         5               9
 Effects of movements in exchange rates  (6)       23              (9)
                                         61        183             126

 

 Current portion      61    120      126
 Non current portion  -     63       -
                      61    183      126

 

 

10.          Inventories

 

                                                         30-Jun-23         30-Jun-22         31-Dec-22

                                                         (unaudited)       (unaudited)       (audited)

                                                         £'000             £'000             £'000
               Phosphate                                 660               484               668
                                                         660               484               668

11.          Trade and other receivables

                                                                30-Jun-23         30-Jun-22         31-Dec-22

                                                                (unaudited)       (unaudited)       (audited)

                                                                £'000             £'000             £'000
               Trade receivables                                89                -                 69
 Other receivables                                              1,496             95                85
 Prepayments                                                    27                20                37
                                                                1,612             115               191

 

Trade receivables and other receivables are stated at their nominal values
less allowances for non-recoverability.

 

12.          Share capital and reserves

 

Dividends

No dividends were declared or paid in the six months ended 30 June 2023 (six
months ended 30 June 2022 : £nil, twelve months ended 31 December 2022:
£nil).

 

13.          Trade and other payables

 Current                                                                             30-Jun-23         30-Jun-22         31-Dec-22

                                                                                     (unaudited)       (unaudited)       (audited)
                                                                                     £'000             £'000             £'000
 Trade payables                                                                      510               401               262
 Accruals                                                                            92                208               59
 Other payables                                                                      247               814               209
 Deferred consideration and loans to previous minority shareholders                  629               -                 628
                                                                                     1,478             1,423             1,158

 

 

 Non-current                                                                         30-Jun-23         30-Jun-22         31-Dec-21

                                                                                     (unaudited)       (unaudited)       (audited)
                                                                                     £'000             £'000             £'000
 Other payables                                                                      -                 1,293             83
 Deferred consideration and loans to previous minority shareholders                  1,066             -                 1,065
                                                                                     1,066             1,293             1,148

 

There is no material difference between the fair value of trade and other
payables and their book value.

 

14.          Acquisition of non-controlling interest ("NCI") in
Falcon Isle

In the comparative period, the Group agreed to acquire the outstanding 49%
equity interest in Falcon Isle, together with loans totalling US$1,816,527
made by the vendor to Falcon Isle for total consideration of $3.2 million
payable in four annual tranches of US$800,000 commencing on 1 July 2022.  The
first payment was made on 30 June 2022., The second payment, due by 1 July
2023, has been treated as a current liability and is included in other
payables. The final two instalments have been treated as non-current
liabilities.

 

 

 

 

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.   END  IR FLFVRALITFIV

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