REG - Kropz PLC - Unaudited Results for Six Months end 30 Sept 2024
19/12/2024 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20241219:nRSS6650Qa&default-theme=true
RNS Number : 6650Q Kropz PLC 19 December 2024
Kropz plc ("Kropz", the "Company") and its subsidiaries (the "Group")
Unaudited Results for the Six Months ended 30 September 2024
Kropz plc (AIM: KRPZ), an emerging African phosphate developer and producer,
is pleased to announce its unaudited results for the six months ended 30
September 2024.
The financial report is available online at the Company's website
www.kropz.com (http://www.kropz.com) .
FINANCIAL AND OPERATIONAL HIGHLIGHTS
Operational highlights
The Group recorded revenue of US$ 14.1 million for the six months ended 30
September 2024. Throughout the six months, Elandsfontein continued operating
in trial production while ramping up production.
Challenges at Elandsfontein relating to the nature and excessive amount of
slimes material encountered in the ore deposit continues limiting production
throughput. Management believes that most of the issues related to the high
slimes content ore will be addressed through the recently installed centrifuge
unit and additional modifications to the processing circuit. The project has
yielded positive results from the initial commissioning. The centrifuge unit
has, however, suffered an early setback after it was commissioned due to
machinery failure, within its warranty period. Although interim measures have
been taken while the repairs are being made, the unit is only expected to be
fully operational during the first quarter of 2025.
The Elandsfontein mine is still in its trial production phase and further
challenges can be expected as it progresses towards full production.
The Company is glad to report and celebrate close to two years free of loss of
time due to injury. The Company adheres to strict health and safety standards
and international best practices. The safety of the Company's employees and
other stakeholders remains a key focus point of management. Kropz continues to
give back to local communities through various projects.
Key financial indicators
· Elandsfontein recognised trial revenue during the six month period
under review. In total, Elandsfontein achieved total sales of US$ 14.1
million for the six months ended 30 September 2024 (Fifteen month period
ended: 31 March 2024: US$ 40 million). This was below expectations due to the
significant mining and production challenges faced relating to the ore
variability for which a solution is being investigated.
· As the Company is still ramping up to steady-state production, a
gross loss has been recognised in the period of US$ 6.4 million. The loss was
largely due to Elandsfontein having to discount its sales prices as a new
market entrant and to consider lower grades being achieved as part of the
ramp-up process, coupled with higher production costs per tonne. With
Elandsfontein operating below planned production levels operational costs per
tonne remain elevated.
· Property, plant, equipment and exploration assets carrying value is
US$ 138.5 million as at 30 September 2024 (31 March 2024: US$ 128.6
million).
· Cash at 30 September 2024 of US$ 1.0 million (31 March 2024:
US$ 1.0 million);
· Shareholder loans and derivatives at 30 September 2024 of
US$ 131.0 million (31 March 2024: US$ 94.4 million).
· Trade and other payables at 30 September 2024 of US$ 14.2
million (31 March 2024: US$ 9.5 million).
· As announced on 11 July 2024, Kropz Elandsfontein and ARC
Fund ("ARC") agreed to a ZAR 140 million (approximately US$ 8 million)
bridge loan facility (the "Loan") to meet immediate cash requirements at Kropz
Elandsfontein. The loan was fully drawn at 22 August 2024.The loan is
unsecured, repayable on demand, with no fixed repayment terms and is repayable
by Kropz Elandsfontein on no less than two business days' notice. Interest is
payable at the South African prime overdraft interest rate plus 6%, nominal
per annum and compounded monthly. In the event that any amounts outstanding
under the loan, together with interest thereon, are not repaid within
6 months from the first utilisation date, the interest rate will be increased
by an additional 2%.
Key corporate and operational developments during the period
Corporate
· The Group announced on 3 September 2024, a restructuring of its debt
obligations ("Restructuring") and a fundraising that was conditional on
shareholders' approval and approval by the South African Reserve Bank
("SARB"). As a result of the Restructuring, Kropz Elandsfontein (Pty) Ltd and
Elandsfontein Land Holdings (Pty) Ltd (the "Elandsfontein Subsidiaries") have
extinguished their debt obligations towards ARC. Kropz has a convertible debt
balance of £88.9 million (including accumulated interest) outstanding with
ARC, being the aggregate of a new Convertible Loan Note ("CLN") and existing
equity facilities (the "Existing Equity Facilities"). Additionally, Kropz has
completed a fundraising of £8.9 million from ARC and other shareholders
before expenses through the issue of new Ordinary Shares an Issue Price of
1.387 pence per new Ordinary Share in the capital of the Company (the
"Fundraising"). The Issue Price represents a discount of approximately 5 per
cent. to the 30-day volume weighted average share price per existing Ordinary
Share to 23 August 2024. In aggregate 643,873,018 new Ordinary Shares have
been allotted and issued pursuant to the Fundraising. ARC and Kropz Plc
subscribed to additional equity in Kropz Elandsfontein (Pty) Ltd for R 66
million and R 154 million, respectively. The transaction was concluded in
October 2024.
Elandsfontein
· Bulk shipments and trial sales have been recorded with a total
of 129,552 tonnes of phosphate concentrate sales over the six months ending 30
September 2024 from Elandsfontein. Elandsfontein, however, achieved lower
sales price compared to the prevailing market price. As a new entrant in the
market, in order to gain market share Elandsfontein was required to offer
discounted pricing to market participants. Furthermore, Elandsfontein produced
lower grade phosphate product as part of its ramp-up operations, which also
impacted the sales price. Elandsfontein is aiming to achieve better prices
going forward in the market as both quality and market reputation improves.
· Sales volumes are below expectations due to the lack of available
stock on hand. Production has been negatively impacted by seasonal rains
during the period under review and continued ore variability.
Hinda
· The Company is still in the process of identifying potential
funding solutions for the development of Hinda.
· Engagement is ongoing with local government regarding project
development and progress.
· A reduced-sized project is being assessed to propose a
fit-for-purpose low capex project to prove the concept of producing phosphate
concentrate in the Congo and exporting it.
· The Company is also engaging with possible suppliers and third
parties to investigate possible efficiencies and capital expenditure
reductions in the proposed feasibility study.
Key developments post the period end
Corporate
· Following the announcement on 3 September 2024, the
restructuring of its debt obligations ("Restructuring") and a fundraising was
concluded in October 2024.
· The BNP loan facility has been fully repaid.
· As announced on 6 November 2024, Kropz Chair, Lord Renwick of
Clifton, passed away. With his sharp intellect and unwavering leadership, we
are deeply saddened by his passing.
· As announced on 6 November 2024, the Kropz board has appointed
Linda Beal as Interim Chair.
Elandsfontein
· Post period end, Elandsfontein achieved production of 49,778 tonnes
of phosphate concentrate and sales of 65,710 tonnes of phosphate
concentrate from October 2024 to November 2024.
· The Company's rock phosphate has been qualified at customers in South
Korea, Australia, New Zealand and Brazil at both single superphosphate ('SSP")
and Phosphoric acid producers.
· Since the start of the 2024 calendar year, Kropz's core customer base
was narrowed down to focus on South Korea, Australia, New Zealand and Brazil,
where the special properties of Kropz Rock Phosphate (Low Cadmium, - toxic
metals, - moisture, - odour and - CaO levels) are complementary to country
rules dictating the final product properties.
· Management expects there to be more than sufficient demand for
Elandsfontein's Rock Phosphate forecast production to the end of 2025. Two
shipments have been planned for qualification trials in both India and Europe
to further diversify the customer base.
· As Elandsfontein has yet to achieve break-even production levels and
production ramp up is still ongoing the Group may be dependent on future fund
raisings to meet any costs that cannot be met from existing cash resources and
sales revenue.
Hinda
· The reduced sized project continues to be assessed to propose a
fit-for-purpose low capex project to prove the concept of producing phosphate
concentrate in the Congo and exporting it. The update of the project
feasibility is ongoing. Cominco has engaged with two engineering firms and
local contractors.
· The Company continues to invest in and prioritise ongoing
community projects.
The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.
For further information visit www.kropz.com (http://www.kropz.com) or contact:
Kropz Plc Via Tavistock
Louis Loubser (CEO) +44 (0) 207 920 3150
Grant Thornton UK LLP Nominated Adviser
Samantha Harrison +44 (0) 20 7383 5100
Harrison Clarke
Ciara Donnelly
Hannam & Partners Broker
Andrew Chubb +44 (0) 20 7907 8500
Ernest Bell
Tavistock Financial PR & IR (UK)
Nick Elwes +44 (0) 207 920 3150
Jos Simson kropz@tavistock.co.uk
R&A Strategic Communications PR (South Africa)
Charmane Russell +27 (0) 11 880 3924
Marion Brower charmane@rasc.co.za
marion@rasc.co.za
About Kropz plc
Kropz is an emerging African phosphate developer and producer with phosphate
projects in South Africa and the Republic of Congo ("RoC"). The vision of the
Group is to become a leading independent phosphate rock producer and to
develop into an integrated, mine-to-market plant nutrient company focusing on
sub-Saharan Africa.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30
SEPTEMBER 2024
30 September 31 March
2024 2024
Unaudited Audited
Notes US$'000 US$'000
Non-current assets
Property, plant, equipment and mine development 7 93,730 85,411
Exploration assets 8 44,790 43,172
Other financial assets 1,738 1,527
Inventories 1,370 955
141,628 131,065
Current assets
Inventories 8,389 5,775
Trade and other receivables 2,970 6,913
Cash and cash equivalents 1,030 968
12,389 13,656
154,017 144,721
TOTAL ASSETS
Current liabilities
Trade and other payables 14,199 9,516
Shareholder loans and derivatives 9 131,014 94,434
Other financial liabilities 10 4,253 11,722
Current taxation liabilities 68 650
149,534 116,322
Non-current liabilities
Provisions 1,622 1,375
1,622 1,375
151,156 117,697
TOTAL LIABILITIES
NET ASSETS 2,861 27,024
Shareholders' equity
Share capital 1,212 1,212
Share premium 194,063 194,063
Merger reserve (20,523) (20,523)
Foreign exchange translation reserve (13,834) (12,132)
Share-based payment reserve 316 295
Accumulated losses (125,778) (108,577)
35,456 54,338
Total equity attributable to the owners of the Company
Non-controlling interests (32,595) (27,314)
2,861 27,024
The accompanying notes form part of the Condensed Consolidated Financial
Statements.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2024
Six months ended Six months ended
30 September 30 September
2024 2023
Unaudited Unaudited
Notes US$'000 US$'000
Revenue 11 14,130 17,842
Cost of Sales (20,569) (17,244)
Gross (loss) / profit (6,439) 598
Other income 33 31
Selling and distribution expenses (2,052) (2,252)
Operating expenses (2,661) (1,937)
Operating loss (11,119) (3,560)
Finance income 12 129 89
Finance expense 13 (8,462) (9,221)
Fair value (loss) / gain from derivative liability 14 (2,597) 12,063
Loss before taxation (22,049) (629)
Taxation 15 595 -
Loss for the period (21,454) (629)
Loss / (profit) attributable to:
Owners of the Company (17,201) 3,697
Non-controlling interests (4,253) (4,326)
(21,454) (629)
Other comprehensive income:
Items that may be subsequently reclassified to profit or loss:
Exchange differences on translating foreign operations (2,730) (323)
Total comprehensive loss (24,184) (952)
Loss attributable to:
Owners of the Company (18,903) 2,887
Non-controlling interests (5,281) (3,839)
(24,184) (952)
Earnings / (loss) per share attributable to owners of the Company:
Basic and diluted (US cents) 16 (1.86) 0.40
The accompanying notes form part of the Condensed Consolidated Financial
Statements.
CONDENSED INTERM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2024
Share Share premium Merger Foreign currency translation Share-based payment reserve Retained earnings Non-controlling interest Total equity
capital reserve reserve Total attributable
to owners
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Unaudited - Six months ended 30 September 2024
Balance at 1 April 2024 1,212 194,063 (20,523) (12,132) 295 (108,577) 54,338 (27,314) 27,024
Total comprehensive loss for the period - - - (1,702) - (17,201) (18,903) (5,281) (24,184)
Share based payment charges - - - - 21 - 21 - 21
Transactions with owners - - - (1,702) 21 (17,201) (18,882) (5,281) (24,163)
Balance at 30 September 2024 1,212 194,063 (20,523) (13,834) 316 (125,778) 35,456 (32,595) 2,861
Audited - Six months ended 30 September 2023
Balance at 1 April 2023 1,212 194,063 (20,523) (11,392) 285 (125,765) 37,880 (22,895) 14,985
Total comprehensive (loss ) / income for the period - - - (810) - 3,697 2,887 (3,839) (952)
Share options exercised - - - - - - - -
Share based payment charges - - - - 44 - 44 - 44
Transactions with owners - - - (810) 44 3,697 2,931 (3,839) (908)
Balance at 30 September 2023 1,212 194,063 (20,523) (12,202) 329 (122,068) 40,811 (26,734) 14,077
The accompanying notes form part of the Condensed Consolidated Financial
Statements.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2024
Six months ended Six months ended
30 September 30 September
2024 2023
Unaudited Unaudited
US$'000 US$'000
Cash flows from operating activities
Loss before taxation (22,049) (629)
Adjustments for:
Depreciation of property, plant and equipment 395 28
Share-based payment 12 20
Interest income (129) (89)
Interest expense 11,996 6,759
Fair value gain / (loss) from derivative liability 2,597 (12,063)
Debt Modification Present value adjustment (105) (103)
Foreign currency exchange differences (2,895) 2,655
Fair value loss / (gain) on game animals 32 (24)
Operating cash flows before working capital changes (10,146) (3,446)
Decrease / (increase) in trade and other receivables 4,418 (3,799)
Increase in inventories (2,179) (3,091)
Increase in payables 3,493 3,658
Net cash flows used in operating activities (4,414) (6,678)
Cash flows used in investing activities
Purchase of property, plant and equipment (1,532) (937)
Exploration and evaluation expenditure (89) (192)
Other financial assets (56) (10)
Interest received 129 89
Net cash flows used in investing activities (1,548) (1,050)
Cash flows from financing activities
Finance cost paid (366) (1,230)
Shareholder loan received 13,690 17,420
Repayment of other financial liabilities (7,564) (7,495)
Net cash flows from financing activities 5,760 8,695
(202) 967
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at beginning of the period 968 3,264
Foreign currency exchange gains / (losses) on cash 264 (430)
Cash and cash equivalents at end of the period 1,030 3,801
The accompanying notes form part of the Condensed Consolidated Financial
Statements.
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2024
1. General information
Kropz and its subsidiaries (together "the Group") is an emerging plant
nutrient producer with an advanced stage phosphate mining project in South
Africa, Elandsfontein, and a phosphate project in the RoC, Hinda. The
principal activity of the Company is that of a holding company for the Group,
as well as performing all administrative, corporate finance, strategic and
governance functions of the Group.
The Company was incorporated on 10 January 2018 and is a public limited
company, with its ordinary shares admitted to the AIM Market of the London
Stock Exchange on 30 November 2018 trading under the symbol, "KRPZ". The
Company is domiciled in England and incorporated and registered in England and
Wales. The address of its registered office is 35 Verulam Road, Hitchin, SG5
1QE. The registered number of the Company is 11143400.
2. Basis of preparation
These interim consolidated financial statements have been prepared in
accordance with IAS 34 Interim Financial Reporting and the AIM rules and in
accordance with the accounting policies of the consolidated financial
statements for the period ended 31 March 2024. They do not include all
disclosures that would otherwise be required in a complete set of financial
statements and should be read in conjunction with the 2024 annual report. The
statutory financial statements for the period ended 31 March 2024 were
prepared in accordance with UK adopted international accounting standards and
the Companies Act 2006 applicable to companies reporting under the
International Financial Reporting Standards ("IFRS").
The interim consolidated financial statements have been prepared under the
historical cost convention unless otherwise stated in the accounting policies.
They are presented in United States Dollars, the presentation currency of the
Group and figures have been rounded to the nearest thousand.
The interim financial information is unaudited and does not constitute
statutory accounts as defined in the Companies Act 2006.
The interim financial information was approved and authorised for issue by the
Board of Directors on 18 December 2024.
3. Going concern
During the six month interim period ended 30 September 2024, the Group
incurred a loss of US$ 21 million (15 months ended 31 March 2024: profit of
US$ 0.3 million) and experienced net cash outflows from operating activities.
Cash and cash equivalents totalled US$ 1.0 million as at 30 September 2024
(31 March 2024: US$ 1.0 million).
Elandsfontein is currently the Group's only operating asset and source of
revenue. As Elandsfontein is still busy ramping up its operations and has yet
to achieve break-even production levels, an operating loss is also expected
for the full financial year ending 31 March 2025. Although the Elandsfontein
production levels are expected to increase over the next 12 months, there
remains a risk that these improvements could be delayed or not result in
sufficient increases in production levels to achieve break even. As such, the
Group may consequently be dependent on future fundraisings to meet any
production costs, overheads, future development and exploration requirements
that cannot be met from existing cash resources and sales revenue.
The Group announced on 3 September 2024, a restructuring of its debt
obligations ("Restructuring") and a fundraising. As a result of the
Restructuring, Kropz Elandsfontein (Pty) Ltd and Elandsfontein Land Holdings
(Pty) Ltd (the "Elandsfontein Subsidiaries") have extinguished their debt
obligations to ARC through a combination of new issuances of equity and
convertible debt instruments. Kropz has a convertible debt of £88.9 million
(including accumulated interest) outstanding with ARC, being the aggregate of
a new Convertible Loan Notes ("CLN") issued as part of the restructuring and
existing equity facilities (the "Existing Equity Facilities"). Additionally,
post the period end Kropz has completed a capital raise of £8.9 million from
ARC and other shareholders before expenses through the issue of new ordinary
shares at an issue price of 1.387 pence per new ordinary share in the capital
of the Company (the "Fundraising"). The issue price represents a discount of
approximately 5 per cent. to the 30-day volume weighted average share price
per existing ordinary share to 23 August 2024. In aggregate 643,873,018 new
ordinary shares have been allotted and issued pursuant to the Fundraising.
Both the Restructuring and Fundraising were concluded after the reporting
date.
Operational cash flows
No additional impairment or reversal of impairment was recognised as at 30
September 2024 following the impairment reversal of US$ 19 million
recognised at 31 March 2024 in relation to the Elandsfontein mine. The
recoverable amount was based on the latest life of mine (LOM) plans following
the updated mineral resource estimate ('MRE") as announced on 20 June 2024.
The recoverable amount of the Elandsfontein mine was estimated based on
discounted cash flows expected to be generated from the continued use of the
cash generating unit (CGU) using market-based commodity prices and exchange
rate assumptions, estimated quantities of recoverable minerals, production
levels, operating costs, capital requirements and its eventual disposal based
on the CGU's latest LOM plans. These calculations include a number of
estimates which if the actual outcome were different could have a significant
impact on the impairment assessment, financial outcome of the Elandsfontein
mine operations and the Group's funding needs.
The going concern assessment was performed using the Group's 18-month cash
flow forecast. The Group's going concern and forecast cash flows are largely
driven by Elandsfontein, as the Group's only operating asset. Elandsfontein's
forecast cashflows are based on its latest mine plan, per the updated MRE as
announced on 20 June 2024.
Elandsfontein's forecast cashflows were estimated using market-based commodity
prices, exchange rate assumptions, estimated quantities of recoverable
minerals, production levels, operating costs and capital requirements over an
18-month period. The going concern assessment only considered Elandsfontein's
resources defined as "measured" and "indicated" per the updated MRE. The
resource classified as "inferred" was not considered part of the mine plan for
purposes of the going concern assessment. However, it is expected that as
mining and drilling activities progress, progressively more of the total
resource will be reclassified from inferred to measured and indicated. In the
updated MRE, the measured and indicated portions increased by 72% based on
updated drilling and statistical estimation.
The 18-month forecast follows the fundraising as described in Note 20.
The critical estimates in the LOM plan and forecast cashflows expected to be
generated can be summarised as follows:
· Phosphate rock prices and grade;
· Phosphate recoveries;
· Operating costs;
· Foreign exchange rates; and
· Discount rates.
The going concern assessment and forecast cashflows are highly sensitive to
these estimates.
Phosphate rock prices and grade: Forecast phosphate rock prices are based on
management's estimates of quality of production and selling price and are
derived from forward price curves and long-term views of global supply and
demand in a changing environment, particularly with respect to climate risk,
building on past experience of the industry and consistent with external
sources.
In total Elandsfontein managed to achieve trial production sales totalling
US$14.1 million during the interim period (fifteen months ended 31 March 2024:
US 40 million). Since 30 September 2024 and the date of the financial
statements, an additional US$ 8.6 million sales have been recognised.
Kropz is and remains a new entrant to the phosphate market and has to date
sold its shipments at a discount to prevailing market prices. The discount was
taken into account in the going concern testing models. The discount is,
however, expected to unwind as Elandsfontein builds its reputation,
establishes itself in the global market and improves its production quality
and stability. As modifications are planned and efficiency improvements are
implemented at Elandsfontein, Elandsfontein should see a gradual improvement
in both grade and quality, some of which have already materialised.
Phosphate recoveries: Estimated production volumes are based on detailed LOM
plans of the measured and indicated resource as defined in the MRE and take
into account development plans for the mine agreed upon by management as part
of the long-term planning process. Production volumes are dependent on a
number of variables, such as: the recoverable quantities; the production
profile; the cost of the development of the infrastructure necessary to
extract the reserves; the production costs; the contractual duration of mining
rights; and the selling price of the commodities extracted.
Estimated production volumes are subject to significant uncertainty given the
ongoing ramp-up. The production ramp-up has been delayed largely by the need
to re-engineer parts of the fine flotation circuit proposed by the vendor.
Mining and processing have also been affected by early unpredicted ore
variability and lack of operator experience. The Company is in the process of
analysing the hard bank and pink ore material to identify the appropriate
method of mining and processing to improve production yield. Production
throughput is also being limited by the nature of slimes material and, the
Company has invested in new equipment to seek to overcome this and aims to
increase production throughput.
Reserves and resources: The LOM plan includes only the measured and indicated
resources as defined in the MRE which represents only around 8 years of
forecast production. There was a significant increase in the measured and
indicated resources in the MRE issued in March 2024 (an increase of 72%)
compared to the MRE issued in December 2022. The Directors believe that the
inferred resources in the MRE are capable of being accessed giving a mine life
of around 12 years, but this has not been taken into account in the discounted
cashflows.
Exchange rates: Foreign exchange rates are estimated with reference to
external market forecasts. The assumed long-term US dollar/ZAR exchange rate
are based on a consensus for the period to year 2028. Future years' exchange
rates were estimated using the prevailing inflation and interest rate
differential between USD and ZAR.
Operating cost: Operating costs are estimated with reference to contractual
and actual current costs adjusted for inflation. Key operating cost estimates
are mine and plant operating costs and transportation and port costs. The
forecast mine and plant costs were based on the contracted rates with the
current mine and plant operators. Production cost per tonne currently is
higher than sales per tonne as full production has not been reached to date,
leading to a gross loss per tonne. The forecast assumes that as production
volumes increase the average cost per tonne of phosphate will decrease with
economies of scale and further efficiency gains.
Mine and plant operating costs: The forecast mine and plant costs were based
on the contracted rates with the current mine and plant operators.
Port costs: The Group has a draft port access agreement with Transnet for
Saldanha port but this has not yet been signed. The Group has paid guest port
charges (the higher rates were used in the forecast) for Saldanha for the
shipments in 2023 and 2024 to date.
Discount rates: A discount rate of 13.98% was applied to the discounted cash
flows used in the LOM plan. This discount rate is derived from the Group's
post-tax weighted average cost of capital (WACC), with appropriate adjustments
made to reflect the risks specific to the CGU and to determine the pre-tax
rate. The WACC takes into account both debt and equity. The cost of equity is
derived from the expected return on investment by the Group's investors. The
cost of debt is based on the interest-bearing borrowings the Group is obliged
to service and the expected cost of any incremental debt.
There is a risk that revenue remains subdued and below operating costs and as
a result the expected improvement in operating margin included in the
discounted cashflows, may not materialise. In such a scenario the recoverable
amount from the Elandsfontein mine will be lower than the discounted cashflows
and subsequently impact the impairment assessment conclusion.
Funding
The Group is dependent on future fundraisings to meet production costs,
overheads, future development and exploration requirements which cannot be met
from existing cash resources and sales revenue alone.
The ARC Fund, on various occasions in the past, provided funding to support
the Group's operations. During the 21 month period to 30 September 2024
financial period end, Kropz, Kropz Elandsfontein and ARC Fund agreed to
further funding totalling ZAR 960 million (approximately US$ 52.2 million)
bridge loan facilities ("Loan") to meet immediate cash requirements at Kropz
Elandsfontein. The bridge loans have been fully settled as part of the
Restructuring and Fundraising transaction as described more fully in Note 20.
The BNP debt facility has been fully settled following the interim period 30
September 2024.
Management has successfully raised money in the past from its supportive major
shareholder, but there is no guarantee that any additional funds that might be
required will be available if needed in the future.
Going concern basis
Based on the Group's current available reserves, recent operational
performance, forecast production and sales coupled with Management's track
record to successfully raise additional funds as and when required, to meet
its working capital and capital expenditure requirements, the Board have
concluded that they have a reasonable expectation that the Group will continue
in operational existence for the foreseeable future and at least for a period
of 18 months from the date of approval of these interim financial statements.
For these reasons, the interim financial statements have been prepared on the
going concern basis, which contemplates the continuity of normal business
activities and the realisation of assets and discharge of liabilities in the
normal course of business.
As there can be no guarantee that any additional funding that might be
required can be raised in the necessary timeframe, a material uncertainty
exists that may cast significant doubt on the Group's ability to continue as a
going concern and therefore it may be unable to realise its assets and
discharge its liabilities in the normal course of business.
The interim financial statements do not include adjustments relating to the
recoverability and classification of recorded asset amounts or to the amounts
and classification of liabilities that might be necessary should the Group not
continue as a going concern.
4. Significant accounting policies
The Company has applied the same accounting policies, presentation, methods of
computation, significant judgements and the key sources of estimation
uncertainties in its interim consolidated financial statements as in its
audited financial statements for the fifteen months ended 31 March 2024,
except for the following amendments. However, none of the recent amendments to
IFRS are expected to materially impact the Group as they are either not
relevant to the Group's activities or require accounting which is consistent
with the Group's current accounting policies.
The following new standards and amendments are effective for the period
beginning on or after 1 January 2024:
· Supplier Finance Arrangements (Amendments to IAS 7 & IFRS 7);
· Lease Liability in a Sale and Leaseback (Amendments to IFRS 16);
· Classification of Liabilities as Current or Non-Current
(Amendments to IAS 1); and
· Non-current Liabilities with Covenants (Amendments to IAS 1).
5. Production start date
The Group assesses the stage of each mine under development/construction to
determine when a mine moves into the production phase, this being when the
mine is substantially complete and ready for its intended use. The criteria
used to assess the start date are determined based on the unique nature of the
mine development. The Group considers various relevant criteria to assess when
the production phase is considered to have commenced. At this point, all
related amounts are reclassified from "trial production" to "steady state
production".
Some of the criteria used to identify the production start date include, but
are not limited to:
• The percentage grade (phosphate concentrate) and volume of ore
being mined is sufficiently economic and consistent with the plant design
specifications;
• Ability to produce phosphate in saleable form (within
specifications); and
• Ability to sustain ongoing production of phosphate.
When the mine moves into the steady state production, the capitalisation of
certain mine development costs ceases and costs are either regarded as forming
part of the cost of inventory or expensed, except for the costs that qualify
for capitalisation relating to mining asset additions or improvements, or
mineable reserve development. It is also at this point that
depreciation/amortisation commences. Refer to Note 7.
6. Segmental information
Operating segments
The Board of Directors consider that the Group has one operating segment,
being that of phosphate mining and exploration. Accordingly, all revenues,
operating results, assets and liabilities are allocated to this activity.
Geographical segments
The Group operates in two principal geographical areas - South Africa and the
RoC.
The Group's revenues and non-current assets by location of assets are detailed
below.
Six months to 30 September 2024 Non-Current Assets
Revenues US$'000
US$'000
South Africa 14,130 96,649
Republic of Congo - 44,979
14,130 141,628
Fifteen months to 31 March 2024 Non-Current Assets
Revenues US$'000
US$'000
South Africa 40,087 87,685
Republic of Congo - 43,380
40,087 131,065
7. Tangible assets - Property, plant, equipment and mine development
30 Sep 30 Sep 30 Sep 31 Mar 2024 31 Mar 31 Mar
2024 2024 2024 2024 20224
Cost Accumulated Carrying value Cost Accumulated Carrying value
depreciation and impairment depreciation and impairment
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Buildings and infrastructure
Land 1,404 (615) 789 1,278 (615) 663
Buildings (4,429) 5,883 9,379 (3,949) 5,430
10,312
Capitalised road costs 7,530 (5,673) 1,857 6,853 (4,906) 1,947
Capitalised electrical sub-station costs 3,267 (2,419) 848 2,973 (2,090) 883
Machinery, plant and equipment
Critical spare parts 2,065 (847) 1,218 1,824 (755) 1,069
Plant and machinery 96,329 (40,602) 55,727 86,837 (36,243) 50,594
Water treatment plant 3,781 (1,369) 2,412 2,941 (1,222) 1,719
Furniture and fittings 56 (46) 10 51 (40) 11
Geological equipment 78 (61) 17 71 (52) 19
Office equipment 136 (131) 5 130 (125) 5
Other fixed assets 1 (1) - 1 (1) -
Motor vehicles 266 (124) 142 252 (93) 159
Computer equipment 149 (137) 12 138 (121) 17
Mine development 19,555 (8,039) 11,516 17,762 (7,148) 10,614
Stripping activity costs 22,589 (9,522) 13,067 20,536 (8,492) 12,044
Game animals 227 - 227 237 - 237
Total 167,745 (74,015) 93,730 151,263 (65,852) 85,411
Reconciliation of property, plant, equipment and mine development - Period
ended 30 September 2024
Opening Additions Fair value gain Deprecia-tion charge Foreign exchange loss Closing balance
Balance US$'000 US$'000 US$'000 US$'000 US$'000
US$'000
Buildings and infrastructure
Land 663 - - - 126 789
Buildings 5,430 10 - (16) 459 5,883
Capitalised road costs 1,947 - - (236) 146 1,857
Capitalised electrical sub-station costs 883 - - (102) 66 847
Machinery, plant and equipment
Critical spare parts 1,069 57 - - 92 1,218
Plant and machinery 50,594 883 - (5) 4,256 55,728
Water treatment plant 1,719 517 - - 175 2,411
Furniture and fittings 11 - - (1) 1 11
Geological equipment 19 - - (4) 2 17
Office equipment 5 1 - (1) - 5
Other fixed assets - - - - - -
Motor vehicles 159 - - (22) 6 143
Computer equipment 17 2 - (8) - 11
Mine development 10,614 38 - - 864 11,516
Stripping activity costs 12,044 26 - - 998 13,068
Game animals 237 - (32) - 21 226
Total 85,411 1,534 (32) (395) 7,212 93,730
Reconciliation of property, plant, equipment and mine development - Year ended
31 March 2024
Opening Additions Disposals Depreciation charge Foreign exchange loss Closing balance
Balance US$'000 US$'000 Fair value gain/ (loss) Impair- US$'000 US$'000 US$'000
US$'000 US$'000 ment
US$'000
Buildings and infrastructure
Land 623 - - 337 - (297) 663
Buildings 4,243 516 (1) 1,109 (37) (400) 5,430
Capitalised road costs 1,891 - - - 800 (582) (162) 1,947
Capitalised electrical sub-station costs 852 - - - 356 (252) (73) 883
Machinery, plant and equipment
Critical spare parts 784 218 - - 138 - (71) 1,069
Plant and machinery 41,575 1,186 - (42) 11,768 (202) (3,691) 50,594
Water treatment plant 1,025 853 - - (60) - (99) 1,719
Furniture and fittings 15 - - - - (4) - 11
Geological equipment 31 - - - - (9) (3) 19
Office equipment 2 129 - (27) - (99) - 5
Other fixed assets - - - - - - - -
Motor vehicles - 127 - 56 - (24) - 159
Computer equipment 34 70 (2) - - (81) (4) 17
Mine development 7,936 1,812 - - 1,570 - (704) 10,614
Stripping activity costs 9,772 474 - - 2,665 - (867) 12,044
Game animals 182 - - 74 - - (19) 237
Total 68,965 5,385 (2) 60 18,683 (1,290) (6,390) 85,411
Kropz Elandsfontein has a fully drawn down project financing facility with BNP
Paribas for US$ 30 million, outstanding balance as at 30 September: $3 750
000 (see Note 10). BNP has an extensive security package over all the assets
of Kropz Elandsfontein and Elandsfontein Land Holdings (Pty) Ltd
("Elandsfontein Land Holdings") as well as the share investments in those
respective companies owned by Kropz SA (Pty) Ltd ("Kropz SA"). The facility
was fully repaid after 30 September 2024.
8. Intangible assets - exploration and evaluation costs
30 September 31 March
2024 2024
US$'000 US$'000
Capitalised exploration costs
Cost 44,790 43,172
Amortisation - -
Carrying value 44,790 43,172
Reconciliation of exploration assets
Opening Additions Foreign exchange Gain Closing balance
Balance US$'000 US$'000 US$'000
US$'000 Disposals
US$'000
Period ended 30 September 2024
Capitalised exploration costs 43,172 98 - 1,520 44,790
Reconciliation of exploration assets
Opening Additions Foreign exchange loss Closing balance
Balance US$'000 US$'000 US$'000
US$'000 Disposals
US$'000
Period ended 31 March 2024
Capitalised exploration costs 42,415 393 - 364 43,172
The costs of mineral resources acquired and associated exploration and
evaluation costs are not subject to amortisation until they are included in
the life-of-the-mine plan and production has commenced.
Where assets are dedicated to a mine, the useful lives are subject to the
lesser of the asset category's useful life and the life of the mine, unless
those assets are readily transferable to another productive mine. In
accordance with the requirements of IFRS 6, the Board of Directors assessed
whether there were any indicators of impairment. No indicators were
identified.
9. Shareholder loans and derivative liability
30 September 31 March
2024 2024
US$'000 US$'000
Shareholder loans - ARC Fund 19,623 18,826
Demand Loan facility - ARC Fund 65,913 41,745
Convertible debt - ARC Fund 35,896 27,387
Derivative liability 9,582 6,476
131,014 94,434
Maturity
Non-current - -
Current 131,014 94,434
Total 131,014 94,434
Shareholder loans - ARC Fund
The loans are: (i) US$ denominated, but any repayments will be made in ZAR at
the then prevailing ZAR/US$ exchange rate; (ii) carry interest at monthly
LIBOR plus 3%; and (iii) are repayable by no later than 1 January 2035 (or
such earlier date as agreed between the parties to the shareholder
agreements). The Shareholder loans were fully settled as part of the
Restructuring transaction (Note 20).
Demand Loan facility - ARC Fund
The loans are unsecured, repayable on demand, and interest accruing at SA
prime overdraft rate plus 6%, if not repaid within 6 months from first
utilisation date rate increases by 2%. The Demand Loan facility was fully
settled as part of the Restructuring transaction (Note 20).
Convertible debt - ARC Fund
On 20 October 2021, the Company entered into a new convertible equity facility
of up to ZAR 200 million ("ZAR 200 Million Equity Facility") with ARC, the
Company's major shareholder. Interest is payable at 14% nominal, compounded
monthly. At any time during the term of the ZAR 200 Million Equity Facility,
repayment of the ZAR 200 Million Equity Facility capital amount will, at the
election of ARC, either be in the form of the conversion into ordinary shares
of 0.1 pence each ("Ordinary Shares") in the Company and issued to ARC, at a
conversion price of 4.5058 pence per Ordinary Share each, representing the
30-day Volume Weighted Average Price ("VWAP") on 21 September 2021, and at
fixed exchange rate of GBP 1 = ZAR 20.24 ("Conversion"), or payable in cash by
the Company at the end of the term of the ZAR 200 Million Equity Facility
which is 27 October 2026. The ZAR 200 Million Equity Facility is fully drawn
at the date of this report.
As announced on 11 May 2022, the Company entered into a new conditional
convertible equity facility of up to ZAR 177 million ("ZAR 177 Million Equity
Facility") with ARC. Interest is payable at 14% nominal, compounded monthly.
At any time during the term of the ZAR 177 Million Equity Facility, repayment
of the ZAR 177 Million Equity Facility capital amount will, at the election of
ARC, either be in the form of the conversion into Ordinary Shares in the
Company and issued to ARC, at a conversion price of 9.256 pence per Ordinary
Share each, representing the 30-day Volume Weighted Average Price ("VWAP") on
4 May 2022, and at fixed exchange rate of ZAR 1 = GBP 0.0504 ("Conversion"),
or payable in cash by the Company at the end of the term of the ZAR 177
Million Equity Facility which is 2 June 2027. The ZAR 177 Million Equity
Facility is fully drawn at the date of this report.
As announced on 14 November 2022, the Company entered into a new conditional
convertible equity facility of up to ZAR 550 million ("ZAR 550 Million Equity
Facility") with ARC. Interest is payable at the South African prime overdraft
interest rate plus 6%, nominal per annum and compounded monthly. At any time
during the term of the ZAR 550 Million Equity Facility, repayment of the
ZAR 550 Million Equity Facility capital amount will, at the election of ARC,
either be in the form of the conversion into Ordinary Shares in the Company
and issued to ARC, at a conversion price of 4.579 pence per Ordinary Share
each, representing the 30-day Volume Weighted Average Price ("VWAP") on 21
October 2022 and at fixed exchange rate of ZAR 1 = GBP 0.048824
("Conversion"), or payable in cash by the Company at the end of the term of
the ZAR 550 Million Equity Facility which is 30 November 2027. The ZAR 550
Million Equity Facility is fully drawn at the date of this report.
Derivative liability
It was determined that the conversion option embedded in the convertible debt
equity facility be accounted for separately as a derivative liability.
Although the amount to be settled is fixed in ZAR, when converted back to
Kropz's functional currency will result in a variable amount of cash based on
the exchange rate at the date of conversion. The value of the liability
component and the derivative conversion component were determined at the date
of draw down using a Monte Carlo simulation. The debt host liability was
bifurcated based on the determined value of the option. Subsequently, the
embedded derivative liability is adjusted to reflect fair value at each period
end with changes in fair value recorded in profit and loss (refer to Note 19).
Fair value of shareholder loans
The carrying value of the loans approximates their fair value.
10. Other financial liabilities
30 September 31 March
2024 2024
US$'000 US$'000
BNP Paribas ("BNP") 3,750 11,262
Greenheart Foundation 503 460
Total 4,253 11,722
BNP
A US$ 30,000,000 facility was made available by BNP Paribas to Kropz
Elandsfontein in September 2016.
In May 2020, Kropz Elandsfontein and BNP Paribas agreed to amend and restate
the term loan facility agreement entered into on or about 13 September 2016
(as amended from time to time). The BNP Paribas facility amendment agreement
extends inter alia the final capital repayment date to Q3 2024, with eight
equal capital repayments to commence in Q4 2022 and an interest rate of 6.5%
plus LIBOR, up to project completion and 4.5% plus LIBOR thereafter.
BNP Paribas has an extensive security package over all the assets of Kropz
Elandsfontein and Elandsfontein Land Holdings as well as the share investments
in those respective companies owned by Kropz SA.
The BNP loan is subject to covenant clauses. Kropz Elandsfontein did not reach
project completion as stipulated in the agreement to be 31 December 2022 and
failed to fund the Debt Service Reserve Account, however BNP Paribas provided,
a waiver to 30 September 2024. The outstanding balance is therefore presented
as a current liability. The facility was fully repaid post 30 September 2024.
Greenheart Foundation
A loan has been made to the Group by Greenheart Foundation which is
interest-free and repayable on demand. Louis Loubser, a Director of Kropz plc,
is a Director of Greenheart Foundation.
Fair value of other financial liabilities
The carrying value of the loans approximate their fair value.
11. Revenue
Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
Sales to region/country
South Africa 27 9
Australia 2,174 1,454
Brazil 1 4,815
New Zealand 4,117 -
South Korea 7,811 11,564
14,130 17,842
Timing of transfer of Goods
Delivery to port of departure 14,130 17,842
14,130 17,842
All 2024 revenue from phosphate is trial revenue. All 2024 revenue from
phosphate is recognised at a point in time when control transfers.
12. Finance income
Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
Interest income 129 89
Total 129 89
13. Finance expense
Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
Shareholder loans 11,434 5,371
Foreign exchange (gains) / losses (3,429) 2,565
Bank debt 356 1,217
BNP Paribas - Debt modification present value adjustment amortisation (105) (103)
BNP Paribas amendment fee amortisation 92 90
Other 114 81
Total 8,462 9,221
14. Fair value (loss) / gain from derivative liability
Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
Fair value (loss) / gain from derivative liability (2,597) 12,063
Total (2,597) 12,063
The Company has entered into three convertible equity facilities with the ARC
Fund. On 20 October 2021, the Company entered into the first a convertible
equity facility of up to ZAR 200 million ("ZAR 200 Million Equity Facility").
The second convertible equity facility was entered into on 11 May 2022 of up
to ZAR 177 million ("ZAR 177 Million Equity Facility"). On 14 November 2022,
the Company entered into its third conditional convertible equity facility of
up to ZAR 550 million ("ZAR 550 Million Equity Facility.") (refer to Note
9).
It was determined that the conversion option embedded in the convertible debt
equity facility be accounted for separately as a derivative liability.
Although the amount to be settled is fixed in ZAR, when converted back to
Kropz's functional currency will result in a variable amount of cash based on
the exchange rate at the date of conversion. The value of the liability
component and the derivative conversion component was determined at the date
of draw down using a Monte Carlo simulation. The debt host liability was
bifurcated based on the determined value of the option. Subsequently, the
embedded derivative liability is adjusted to reflect fair value at each period
end with changes in fair value recorded in profit and loss (refer to Note 19).
15. Taxation
Major components of tax charge Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
Deferred
Originating and reversing temporary differences - -
Current tax
UK tax in respect of the prior period 595 -
UK tax in respect of the current period - -
Total 595 -
The Group had losses for tax purposes of approximately US$ 92.2 million (30
September 2023: US$ 56.3 million) which, subject to agreement with taxation
authorities, are available to carry forward against future profits. A net
deferred tax asset arising from these losses has not been recognised as steady
state production has not been reached and therefore the reversal of any
potential deferred tax asset remains uncertain.
16. Earnings per share
There are no dilutive amounts in issue. The calculations of basic and diluted
earnings per share have been based on the following loss attributable to
ordinary shareholders and the weighted average number of ordinary shares
outstanding:
Six months ended Fifteen months
30 September ended
2024 30
US$'000 September
2023
US$'000
Profit / (Loss) attributable to ordinary shareholders (17,201) 3,697
Weighted average number of ordinary shares in Kropz plc 925,818,223 926,718,223
Basic and diluted profit / (loss) per share (US cents) (1.86) 0.40
17. Related party transactions
Details of share issues and shareholder and related party loans are explained
in Notes 9 and 10. The following transactions were carried out with related
parties:
Related party balances
Loan accounts - Owed to related parties
30 September 31 March
2024 2024
US$'000 US$'000
Shareholder loans - ARC Fund 19,623 18,826
Demand Loan facility - ARC Fund 65,913 41,745
Convertible debt - ARC Fund 35,896 27,387
Derivative liability 9,582 6,476
Greenheart Foundation 503 460
Total 131,517 94,894
Related party balances
Interest accrued to related parties
Six months ended Six months ended
30 September 30 September
2024 2023
US$'000 US$'000
ARC Fund 11,434 5,371
Total 11,434 5,371
18. Seasonality of the Group's business
There are no seasonal factors which materially affect the operations of any
company in the Group.
19. Fair value
The following table compares the carrying amounts and fair values of the
Group's financial assets and financial liabilities as at 30 September 2024.
The Group considers that the carrying amount of the following financial assets
and financial liabilities are a reasonable approximation of their fair value:
· Trade receivables;
· Trade payables;
· Restricted cash; and
· Cash and cash equivalents.
As at 30 September 2024 As at 31 March 2024
Carrying amount Fair Carrying amount Fair
US$'000 value US$'000 value
US$'000 US$'000
Financial Assets
Other financial assets 1,738 1,738 1,527 1,527
Total 1,738 1,738 1,527 1,527
Financial Liabilities
Shareholder loans 121,432 121,432 87,958 87,958
Derivative liability 9,582 9,582 6,476 6,476
Other financial liabilities 4,253 4,253 11,722 11,722
Total 135,267 135,267 106,156 106,156
This note provides an update on the judgements and estimates made by the Group
in determining the fair values of the financial instruments.
(i) Financial instruments Measured at Fair Value
The financial instruments recognised at fair value in the Statement of
Financial Position have been analysed and classified using a fair value
hierarchy reflecting the significance of the inputs used in making the
measurements.
(ii) Fair value hierarchy
The fair value hierarchy consists of the following levels
• Quoted prices in active markets for identical assets and
liabilities (Level 1);
• Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (as prices) or
indirectly (derived from prices) (Level 2); and
• Inputs for the asset and liability that are not based on
observable market date (unobservable inputs) (Level 3).
Level 1 Level 2 Level 3 Total
US$'000 US$'000 US$'000 US$'000
30 September 2024
Derivative liability - - 9,582 9,582
31 March 2024
Derivative liability - - 6,476 6,476
There were no transfers between levels for recurring fair value measurements
during the year.
(iii) Reconciliation: Level 3 fair value measurement
Six months ended Period ended
30 September 31 March
2024 2024
US$'000 US$'000
Derivative liability
Opening balance (6,476) (23,037)
Fair value at initial recognition - (3,235)
Fair value gain/(loss) recognised in profit and loss (2,597) 20,601
Foreign exchange (509) (805)
Closing balance (9,582) (6,476)
(iv) Valuation technique used to determine fair value
Derivative liability:
The fair value is calculated with reference to market rates using industry
valuation techniques and appropriate models from a third-party provider. The
Monte-Carlo model utilised includes a high level of complexity and the main
inputs are share price volatility, risk margin, foreign exchange volatility
and UK risk-free rate. A number of factors are considered in determining these
inputs, including assessing historical experience but also considering future
expectations. The determined fair value of the option is multiplied by the
number of shares available for issue pursuant to the ZAR 200 Million Equity
Facility, ZAR 177 Million Equity Facility and the ZAR 550 Million Equity
Facility (refer to Note 9).
Valuation results (as at 30 September 2024)
Total loan amount Value per Number of Total Value
Facility (ZAR) share (p) Shares (GBP)
ZAR200m facility 200,000,000 0.57 219,272,938 1,251,396
ZAR177m facility 177,000,000 0.43 96,378,566 413,644
ZAR550m facility 550,000,000 0.94 586,442,455 5,492,005
Total 902,093,959 7,157,045
Sensitivity Valuation results (as at 30 September 2024) - Volatility
Total Value
(GBP) - 75%
Base volatility historical
Facility assumption volatility (66%)
ZAR200m facility 87.87% 594,225
ZAR177m facility 87.87% 143,773
ZAR550m facility 87.87% 2,863,434
Total 3,601,432
Sensitivity Valuation results (as at 30 September 2024) - Risk Margin
Total Value Total Value
Base risk margin (GBP) - 7% (GBP) - 3%
Facility assumption risk margin risk margin
ZAR200m facility 5% 1,253,532 1,249,171
ZAR177m facility 5% 414,597 412,640
ZAR550m facility 5% 5,509,643 5,473,412
Total 7,177,772 7,135,223
Sensitivity Valuation results (as at 30 September 2024) - FX volatility
Total Value Total Value
(GBP) - 20% (GBP) - 10%
Facility Base FX volatility FX volatility FX volatility
ZAR200m facility 13.49% 1,254,799 1,252,089
ZAR177m facility 13.49% 416,200 413,351
ZAR550m facility 13.49% 5,500,030 5,494,207
Total 7,171,029 7,159,647
Sensitivity Valuation results (as at 30 September 2024) - UK risk-free rate
Total Value Total Value
(GBP) - UK rf (GBP) - UK rf
Facility Base UK risk-free rate + 2% -2%
ZAR200m facility 3.51% 1,290,782 1,212,559
ZAR177m facility 3.54% 430,974 396,767
zAR550m facility 3.58% 5,659,609 5,235,478
Total 7,381,365 6,934,804
20. Events after the reporting period
Further shipments and sales of 34,405 tonnes of phosphate concentrate from
Kropz Elandsfontein were recorded in October 2024 and 31,305 tonnes in
November.
As announced on 11 July 2024, Kropz Elandsfontein and ARC Fund ("ARC")
agreed to a ZAR 140 million (approximately US$ 8 million) bridge loan
facility (the "Loan") to meet immediate cash requirements at Kropz
Elandsfontein. The facility is fully drawn and settled at the date of this
report.
The Group announced on 3 September 2024, a restructuring of its debt
obligations ("Restructuring") and a fundraising that was conditional on
shareholders' approval and approval by the South African Reserve Bank
("SARB"). As a result of the Restructuring, Kropz Elandsfontein (Pty Ltd and
Elandsfontein Land Holdings (Pty) Ltd (the "Elandsfontein Subsidiaries") have
extinguished their debt obligations to ARC. Kropz now has convertible debt of
£88.9 million (including accumulated interest) outstanding with ARC, being
the aggregate of a new Convertible Loan Note ("CLN") and existing equity
facilities (the "Existing Equity Facilities"). Additionally, Kropz has
completed a fundraising of £8.9 million from ARC and other shareholders
before expenses through the issue of new Ordinary Shares an Issue Price of
1.387 pence per new Ordinary Share in the capital of the Company (the
"Fundraising"). The Issue Price represents a discount of approximately 5 per
cent. to the 30-day volume weighted average share price per existing Ordinary
Share to 23 August 2024. In aggregate 643,873,018 new Ordinary Shares have be
allotted and issued pursuant to the Fundraising. This was concluded after the
reporting date.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END MSCGPGMCPUPCGBRRecent news on Kropz
See all newsREG - Kropz PLC - Notice of Motion application by WWF SA
AnnouncementREG - Kropz PLC - Trading Update and Notification of Legal Claim
AnnouncementREG - Kropz PLC - Unaudited Results for Six Months end 30 Sept 2024
AnnouncementREG - Kropz PLC - Passing of Lord Renwick of Clifton
AnnouncementREG - Kropz PLC - Results of General Meeting
Announcement