REG-Medcaw Investments Plc: Half-yearly Report
27/09/2024 10:15
Medcaw Investments Plc
(“Medcaw” or the “Company”)
Half-year Report for the Period Ended 30 June 2024
CHAIRMAN’S STATEMENT
Operational Review
It is my pleasure to submit the Chairman’s Statement for the Company
covering the six-month period to 30 June 2024.
During the period, the company continued to work closely with the board of
Abyssinian Metals Limited ("AML"), the company developing the Kenticha
Lithium Project located in Oromia State, Southern Ethiopia.
The proposed Reverse Takeover Transaction has taken longer than was initially
intended and this is due to the emergence of a dispute between AML and its 49%
joint venture partner in the project - Oromia Mining Share Company (the
parastatal mining company for Oromia State). Negotiations are ongoing
between the joint venture partners, the Federal Government of Ethiopia and the
Ethiopian Federal Ministry of Mines and there is now a clear process in motion
to achieve a resolution of the dispute. AML, through its legal advisors
(Clifford Chance LLP), constructed and tabled a proposal which not only serves
as a dispute resolution, moreover, establishes a platform for a revised joint
venture agreement, and the issuance of the Mining Licence for the Kenticha
Lithium Project (currently an Exploration License exists over the primary rock
resource).
The proposed transaction constitutes a reverse takeover under the Listing
Rules, therefore, the Company requested its securities be suspended from
trading with effect from 7 July 2023. The Company’s securities continue to
be suspended as the transaction is ongoing.
The Company and AML have engaged professional advisors and continue to work
through diligence and documentation to complete the Transaction.
I would like to thank our shareholders, my fellow directors and our colleagues
at Orana Corporate for their continuing patience and ongoing support.
Financial Review
The Company incurred administrative expenses of £165,603 during the six
months to 30 June 2024. At the end of the period the Company had cash of
£162,941,
Outlook
The directors are working with the Company’s advisers on the acquisition of
AML and the re-admission of the Company’s shares to trading on the London
Stock Exchange with the aim of completing this transformational and value
enhancing transaction in as short a time frame as possible.
Principal Risks and Uncertainties
The principal risks and uncertainties for the remaining six months of the
financial year remain the same as those contained within the annual report and
accounts as at 31 December 2023.
Related Party Transactions
No related party transactions have taken place in the first six months of the
current financial year. There have been no changes in the related party
transactions described in the last annual report that could have a material
effect on the financial position or performance of the Company in the first
six months of the current financial year.
Statement of Directors’ Responsibilities
The directors confirm that these condensed interim financial statements have
been prepared in accordance with UK adopted International Accounting Standard
34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom’s Financial Conduct Authority and
that the interim management report includes a fair review of the information
required by DTR 4.2.7 and DTR 4.2.8, namely:
* an indication of important events that have occurred during the first six
months and their impact on the condensed set of financial statements, and a
description of the principal risks and uncertainties for the remaining six
months of the financial year; and
* material related-party transactions in the first six months and any material
changes in the related-party transactions described in the last annual report.
Marcus Yeoman
Non-Executive Chairman
26 September 2024
CONTACT:
Medcaw Investments Plc
Charlie Wood via Orana Corporate
LLP +44 (0) 203 475 6834
For more information please visit: https://medcaw-invest.com/
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
FOR 6 MONTHS TO 30 JUNE 2024
Unaudited Unaudited
6 months ended 6 months ended
30 June 2024 30 June 2023
Note £ £
Revenue - -
Administrative expenses (165,603) (135,975)
Impairment (172,428) -
Operating result (338,031) (135,975)
Finance income/(expense) 15,000 -
Loss before taxation (323,031 (135,975)
Income tax - -
Loss for the period and total comprehensive income for the period (323,031) (135,975)
Basic and diluted loss per ordinary share (pence) 3 (1.46) (0.79)
CONDENSED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
Unaudited Audited
As at 30 June 2024 As at 31 December 2023
Note £ £
ASSETS
Current assets
Other current assets 16,938 140,323
Cash and cash equivalents 162,941 371,484
Loan notes 4 - -
Total assets 179,879 511,807
Liabilities
Current liabilities
Trade & other payables 233,854 242,751
Total liabilities 233,854 242,751
Net (liabilities)/assets (53,975) 269,056
EQUITY AND LIABILITIES
Equity attributable to owners
Ordinary share capital 5 221,320 221,320
Share premium 5 1,005,110 1,005,110
Share based payments reserve 14,903 14,903
Accumulated losses (1,295,308) (972,277)
Total equity (53,975) 269,056
CONDENSED STATEMENT OF CHANGES IN EQUITY
AS AT 30 JUNE 2024
Ordinary share Share Share based Retained earnings Total
capital premium payment reserve equity
£ £ £ £ £
As at 31 December 2022 171,320 679,110 - (260,170) 590,323
Comprehensive loss for the year
Loss for the year - - - (712,170) (712,170)
Total comprehensive loss for the year - - - (712,170) (712,170)
Transactions with owners
Warrants issued during year - - 14,903 - 14,903
Ordinary shares issued during year 50,000 350,000 - - 400,000
Share issue costs - (24,000) - - (24,000)
Total transactions with owners 50,000 326,000 14,903 - 390,903
As at 31 December 2023 221,320 1,005,110 14,903 (972,277) (269,056)
Comprehensive loss for the period
Loss for the period - - - (323,031) (323,031)
Total comprehensive loss for the period - - - (323,031) (323,031)
Transactions with owners
Ordinary shares issued during year - - - - -
Total transactions with owners - - - - -
As at 30 June 2024 221,320 1,005,110 14,903 (1,295,308) (53,975)
CONDENSED STATEMENT OF CASH FLOWS
FOR 6 MONTHS TO 30 JUNE 2024
Unaudited Unaudited
6 months ended 6 months ended
30 June 2024 30 June 2023
£ £
Cash flows from operating activities
Loss before income tax (323,031) (135,975)
Adjustments for:
Impairment 172,428 -
Interest income (15,000) -
Share based payments - -
Decrease / (Increase) in other receivables 123,385 (21,565)
Decrease in other payables (8,897) (161,327)
Net cash from operating activities (51,115) (318,867)
Cash flows from financing activities
Cash received from issue of ordinary Shares - 187,250
Net cash inflow from financing activities - 187,250
Cash flows from investing activities
Loan notes (157,428) (150,000)
Net cash inflow from investing activities (157,428) (150,000)
Net (decrease)/ increase in cash and cash equivalents (208,543) (281,617)
Cash and cash equivalents at beginning of period (371,484) 643,872
Cash and cash equivalents at end of period 162,941 362,255
NOTES TO THE INTERIM FINANCIAL INFORMATION
FOR 6 MONTHS TO 30 JUNE 2024
1 General information
The Company was incorporated on 11 December 2020 as a public company in
England and Wales with company number 13078596 under the Companies Act,
2006.
The address of its registered office is Central Working Victoria Eccleston
Yards, 25 Eccleston Place London SW1W 9NF United Kingdom.
The principal activity of the Company is to pursue one or more acquisitions in
the natural resources field.
2 Accounting policies
IAS 8 requires that management shall use its judgement in developing and
applying accounting policies that result in information which is relevant to
the economic decision-making needs of users, that are reliable, free from
bias, prudent, complete and represent faithfully the financial position,
financial performance and cash flows of the entity.
2.1 Basis of preparation
The Interim Financial Statements of the Company are unaudited condensed
financial statements for the six month period ended 30 June 2024.
The accounting policies applied by the Company in these Interim Financial
Statements, are the same as those applied by the Company in its financial
statements and have been prepared on the basis of the accounting policies
applied for the financial year to 31 December 2023 which have been prepared in
accordance with IFRS as adopted by UK for. The Company Financial Statements
have been prepared using the measurement bases specified by IFRS each type of
asset, liability, income and expense.
The functional currency for the Company is determined as the currency of the
primary economic environment in which it operates. The functional and
presentational currency of the Company is Pounds Sterling (£).
The business is not considered to be seasonal in nature.
The comparative figures have been presented as the Company Financial
Statements cover the 6 month period ended 30 June 2023 and the 12 month
period ended 31 December 2023.
New standards, amendments and interpretations adopted
During the current period the Company adopted all the new and revised
standards, amendments and interpretations that are relevant to its operations
and are effective for accounting periods beginning on 1 January 2024. This
adoption did not have a material effect on the accounting policies of the
Company.
New standards, amendments and interpretations not yet adopted by the Company.
The standards and interpretations that are relevant to the Company, issued,
but not yet effective, up to the date of these interim Financial information
have been evaluated by the Directors and they do not consider that there will
be a material impact of transition on the financial information.
2.2 Going concern
The financial statements have been prepared on a going concern basis, which
assumes that the Company will continue in operational existence for the
foreseeable future.
The Company has based the going concern assumption on a base case, where any
proposed transaction does not take place meaning the entity has the ability to
meet its working capital requirements from existing cash. The existing cash
are sufficient to meet the working capital requirements of the Company going
forward when outgoings are reduced to only committed costs. This includes
applying mitigation measures to reduce the cost base of the Company. As a
result of this the directors believe that the going concern assumption is
appropriate.
Under the scenario that any proposed acquisition does take place the Company
would secure additional funding to ensure that all future capital commitments
would be able to be satisfied.
Taking these matters into consideration, the Directors consider that the
continued adoption of the going concern basis is appropriate having reviewed
the forecasts for the coming 12 months from the date of signing and the
financial statements do not reflect any adjustments that would be required if
they were to be prepared other than on a going concern basis.
2.4 Cash and cash equivalents
The Directors consider any cash on short-term deposits and other short-term
investments to be cash equivalents.
2.5 Financial assets and liabilities
Financial assets and financial liabilities are recognised when the Company
becomes a party to the contractual provisions of a financial instrument.
Financial assets and financial liabilities are offset if there is a legally
enforceable right to set off the recognised amounts and interests and it is
intended to settle on a net basis.
2.6 Earnings per Ordinary Share
The Company presents basic and diluted earnings per share data for its
Ordinary Shares. Basic earnings per Ordinary Share is calculated by dividing
the profit or loss attributable to Shareholders by the weighted average number
of Ordinary Shares outstanding during the period. Diluted earnings per
Ordinary Share is calculated by adjusting the earnings and number of Ordinary
Shares for the effects of dilutive potential Ordinary Shares.
2.7 Equity
Share capital is determined using the nominal value of shares that have been
issued.
The share premium account includes any premiums received on the initial
issuing of the share capital. Any transaction costs associated with the
issuing of shares are deducted from the share premium account, net of any
related income tax benefits.
Retained losses includes all current and prior period results as disclosed in
the income statement.
2.8 Critical accounting estimates and judgments
In preparing the Company Financial information, the Directors have to make
judgments on how to apply the Company’s accounting policies and make
estimates about the future. The Directors do not consider there to be any
critical judgments that have been made in arriving at the amounts recognised
in the interim financial information.
3 Loss per Ordinary Share
As at 30 June 2024 As at 30 June 2023
Basic loss per Ordinary Share
Earnings attributable to Shareholders (323,031) (135,975)
Weighted average number of Ordinary Shares 22,132,095 17,132,095
Basic and diluted loss per share (pence) (1.46) (0.79)
4 Loan notes
As at As at
30 June 2024 £ 31 December 2023 £
Loan note 307,338 149,109
Interest receivable 22,849 7,849
Provision for doubtful debts (330,187) (157,759)
- -
On 23rd June 2023 and January 2021 £149,109 and £157,428 was loaned to
Abyssinian Metals Pty Ltd (AML) to fund working capital requirements. The loan
accrues interest at 10% per annum payable in monthly instalments. The loan is
repayable upon demand by the lender and can be converted into shares in AML
subject to certain milestones. As at reporting date the loan has not been
converted to equity. Due to inherent uncertainties around the collectability
of the loan a provision has been raised and an impairment charge for the full
amount recorded in the current year.
5 Share Capital
Ordinary Shares Share Capital Share Premium Total
£ £ £
At 31 December 2022 17,132,095 171,320 679,110 850,430
Issue of ordinary shares 3 5,000,000 50,000 350,000 400,000
Share issue costs - - (24,000) (24,000)
At 31 December 2023 22,132,095 221,320 1,005,110 1,226,430
Movement for the year - - - -
As at 30 June 2024 22,132,095 221,320 1,005,110 1,226,430
6 Warrants
As at 30 June 2024
Weighted average Number of warrants
exercise price
Brought forward at 1 January 2024 20p 13,712,500
Granted in year - -
Vested in year - -
Outstanding at 30 June 2024 20p 13,712,500
Exercisable at 30 June 2024 20p 13,712,500
The weighted average time to expiry of the warrants as at 30 June 2024 is 1.5
years.
7 Related party transactions
There have been no material related party transactions in the period that
require disclosure.
8 Events subsequent to the reporting date
There have been no material events subsequent to the reporting date.
9 Financial commitments and contingent liabilities
There were no financial commitments or contingent liabilities of the Company
as at 30 June 2024.
10 Ultimate controlling party
As at 30 June 2024, there was no ultimate controlling party of the Company.
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