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RNS Number : 5599E Power Metal Resources PLC 30 June 2023
30 June 2023
Power Metal Resources plc / EPIC: POW / Market: AIM
Power Metal Resources plc ("POW", "Power Metal" or the "Company")
Interim Results
Power Metal Resources plc, the AIM listed metals exploration and development
company, announces its unaudited interim results for the six month period
ended 31 March 2023 (the "period").
Sean Wade, Chief Executive Officer of Power Metal commented: "The key to
unlocking value is to complete planned portfolio disposals, secure operational
partnerships over certain exploration interests, drive our uranium interests
forward, and ensure the Company has access to quality sources of finance in
sufficient quantity to enable it to boldly pursue its ambitions.
"We are making progress across all these areas and whilst the completion of
the Golden Metal Resources IPO and £2.7m financing, both in May 2023, are
perhaps the notable events for investors recently, we hope to announce many
more corporate and exploration events in the coming weeks and months.
"I would like to thank shareholders for their continued support as we progress
through what we believe will be a vibrant and exciting period in the Company's
history."
KEY DEVELOPMENTS IN THE HALF YEAR TO 31 MARCH 2023
- Completion of exploration programmes across three projects,
including drilling at Molopo Farms in Botswana and the Victoria Goldfields in
Australia, as well as geophysics and trenching at the Tati project in
Botswana. All three have delivered positive exploration results, justifying
a decision to proceed to next stage exploration with potential partners
showing interest in all three projects.
- Material progress achieved in corporate activities, including
pre-IPO preparations for Golden Metal Resources PLC, First Development
Resources PLC and Uranium Energy Exploration Ltd.
- Broad spectrum advancement of the Company's Athabasca Basin
uranium portfolio, including additional ground acquisitions through staking,
and the management of third-party interest in the uranium portfolio.
- Completion of the conditional acquisition of a larger stake in the
Molopo Farms Complex project; the conditional disposal of the Company's
interests in the E-12 property in the Athabasca Basin to Uranium Energy
Exploration, and the completion of the disposal of the Company's interest in
the Kanye Resources joint venture ("JV"), to partner Kavango Resources PLC
(LON:KAV) for shares, warrants, royalty and long term compensation potential.
- Management changes including the appointment of Owain Morton as
Non-Executive Director and Sean Wade as Chief Executive Officer. Together the
appointments bring detailed geological, mine engineering and corporate
finance skills to the Board and provide Power Metal with an extensive
financing network for the Company and its planned spin-out IPO activity.
KEY DEVELOPMENTS SINCE 31 MARCH 2023
- Listing of Golden Metal Resources PLC on the London Stock Exchange
in May 2023, with a value of Power Metal's holding on listing of c £4.4m;
- Appointment of Bill Brodie Good as a Non-Executive Director in May
2023; and
- Financing which has raised £2.7m for the Company to support an
acceleration of value generative exploration and corporate activity.
POWER METAL INTERESTS AT TODAY'S DATE
The latest updated review of Power Metal's business interests is provided in
the Company's investor presentation which may be accessed here:
https://www.powermetalresources.com/investors/presentation/
(https://www.powermetalresources.com/investors/presentation/)
In addition, a single page Business Overview is provided for investors through
the following link:
https://www.powermetalresources.com/company/
(https://www.powermetalresources.com/company/)
LATEST POSITION OF POWER METAL INTERESTS AND TARGETED OBJECTIVES FOR 2023
Priority Exploration and Potential Exploration Project Joint Ventures
Exploration Interest Latest Position & Forward Plans
Athabasca Uranium
Saskatchewan, Canada Power Metal currently holds 17 properties covering 1005.14km(2) within and
surrounding the prolific Athabasca Basin.
(Uranium)
POW 100%
The conditional disposal of two of the properties, Reitenbach and E-12, has
been announced and work is underway to complete that transaction through a
listing in the London capital markets for the proposed holding vehicle,
Teathers Financial PLC, to be renamed Uranium Energy Exploration PLC.
Preparation of listing documentation is complete and the IPO financing is
expected to commence shortly with completion of the transaction in 2023.
Across the Company's wider Athabasca exploration interests there has been
considerable third-party interest in working with Power Metal to finance
uranium specific operations. The Company continues to engage with parties and
anticipates significant progress to occur in 2023.
In addition, the Company's recent £2.7m financing has provided the funds for
a considerable uranium exploration programme in the Athabasca during the 2023
season, details of which can be found in the Company's announcement dated 21
June 2023.
Molopo Farms Complex Project The cumulative exploration programmes undertaken at Molopo Farms have
demonstrated significant potential for a major nickel - platinum group element
Botswana discovery or discoveries.
(Nickel - Copper - Platinum Group Element) There has been considerable interest from third parties to work with and
potentially finance Molopo Farms at project level and Power Metal is working
POW: 87.71% with interested parties at present.
The Company is looking to move Molopo Farms forward considerably, targeting a
working partnership in place and operational in 2023.
Tati Project
Botswana Recently completed geophysics and trenching have provided valuable data,
adding to that previously collected. This enables the Company to move forward
(Gold - Nickel) with next stage soil sampling prior to final planning and implementation of
planned next stage reverse circulation and diamond drilling targeting a
POW: 100% significant gold discovery.
Soil sampling is underway currently alongside continuing work to process fines
dumps of previously processed ore from the Cherished Hope gold mine location
within the Tati licence footprint with local processing partners.
Investment Holdings and Disposals Planned/Underway
Note: other project packages within the Power Metal portfolio are also in
earlier stages of disposal and/or spin-out preparations in addition to those
listed below.
Business Interest Latest Position
Kavango Resources PLC (LON:KAV) In Q4 2022 Power Metal announced the conditional disposal of its Kanye
Resources interest to its joint-venture partner KAV.
Botswana & Zimbabwe Exploration
Following this disposal, Power Metal holds c.10% of KAV worth c.£0.8m as at
(Gold - Base Metals) 31 March 2023.
POW c.10% Power Metal also holds 30m warrants to acquire new KAV shares at 4.25p and 30m
warrants to acquire new KAV ordinary shares at 5.5p per share, both with a
life to expiry ending 8 January 2025.
In addition, Power Metal holds a 1% net smelter return royalty over the former
JV land footprint.
First Class Metals PLC (LON:FCM) FCM secured a listing on the London Stock Exchange in late July 2022 with
Power Metal holding an interest following its IPO financing of 28.19% on
Schreiber-Hemlo, Ontario, Canada listing (now c.26% after dilution since listing), worth c.£2.05m as of 31
March 2023.
(Gold - Base Metals)
Power Metal also holds 517,705 warrants to acquire new FCM ordinary shares at
POW c.26% 10p per share with an expiry date of 29 July 2023.
Golden Metal Resources PLC (LON:GMET) GMET secured a listing on the London Stock Exchange in late May 2023 with
Power Metal holding an interest following their IPO financing of 62.06%, worth
Nevada, USA c.£2.05m as at the date of this report.
Gold - Base Metals Power Metal also holds 1,749,378 warrants to acquire new GMET ordinary shares
at 10.75p with an expiry date of 10 May 2024 and 1,749,378 warrants at 17.5p
POW c.62% with an expiry date of 10 May 2025.
First Development Resources PLC (FDR) FDR is currently in the IPO Financing stage of it listing plans with IPO
documentation prepared and ready for listing.
Western Australia /Northern Territory
The listing of FDR is expected to occur in the near term.
(Gold - Copper - Rare Earth Elements - Uranium - Lithium)
POW: c.59%
New Ballarat Gold Corporation PLC (NBGC) Through its Australian operating subsidiary, Red Rock Australasia Pty Ltd,
NBGC has a substantial licence footprint within the Victoria Goldfields,
Victoria, Australia Australia, which is comprised of 17 granted exploration licences covering
1,867km(2) and 5 licence applications covering 493km(2).
(Gold)
The intention of the JV parties is to undertake a listing of NBGC on the UK
POW: 49.9% JV Partner Red Rock Resources PLC (LON:RRR): 50.1% capital markets. Power Metal is targeting a listing during 2023.
ION Battery Resources Ltd (ION) ION comprises two lithium focused projects in Ontario and Quebec and a
graphite project in Saskatchewan.
Canada
Next exploration and corporate steps are under consideration for ION and a
(Lithium & Graphite) further announcement will come in due course. The commercial pathway for ION
is expected to be announced, with material progress in the business expected
POW 100% during 2023.
New Horizon Metals Pty Ltd (NHM) The JV partners behind NHM are currently considering a number of proposals to
secure a listing of NHM on the London or Australian capital markets.
Queensland and South Australia
Completion of a listing is targeted in 2023.
(Copper - Uranium - Gold)
POW 20%
PROJECTS WITH NEXT STEPS UNDER CONSIDERATION
Project Latest Position & Key Forward Events
Haneti Project
Tanzania Power Metal is currently in discussions with a JV partner Katoro Gold
(LON:KAT), to determine the future of the Haneti Project.
(Polymetallic)
POW: 35% (65% JV Partner Katoro Gold plc (LON:KAT))
Further information will be provided when material developments occur.
Silver Peak Project
British Columbia, Canada Power Metal is currently in discussions with its JV partner to determine next
corporate and exploration steps for Silver Peak.
(Silver)
POW: 30%
An outcome to these discussions is expected in the near term with advancement
of the project from an exploration and/or commercial perspective anticipated
during the remainder of 2023.
FINANCIAL HIGHLIGHTS FOR THE HALF YEAR ENDED 31 MARCH 2023
· Loss for the period, attributable to owners of the parent of £1.50
million (2022: £1.69 million), resulting in loss per share of 0.09 pence
(2022: 0.12 pence);
· Financing undertaken in January 2023 raising £0.9 million and
acquisitions during the period raised £1.1 million for the Company;
· Total assets of £14.62 million at the period end (30 September 2022:
£14.61 million); and
· Net assets of £13.99 million at the period end (30 September 2022:
£13.76 million).
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.
For further information please visit POW https://www.powermetalresources.com/
(https://www.powermetalresources.com/) or contact:
Power Metal Resources plc
Sean Wade (Chief Executive Officer) + 44 (0) 20 3778 1396
SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat/Charlie Bouverat +44 (0) 20 3470 0470
SI Capital Limited (Joint Broker)
Nick Emerson +44 (0) 1483 413 500
First Equity Limited (Joint Broker)
David Cockbill/Jason Robertson +44 (0) 20 7330 1883
Blythe Ray (Financial PR)
Tim Blythe/Megan
Ray
+44 (0) 20 7138 3204
Notes to Editors:
Power Metal Resources plc (LON:POW) is an AIM listed metals exploration
company which finances and manages global resource projects and is seeking
large scale metal discoveries.
The Company has a principal focus on opportunities offering district scale
potential across a global portfolio including precious, base, and strategic
metal exploration in North America, Africa, and Australia.
Project interests range from early-stage greenfield exploration to later-stage
prospects currently subject to drill programmes.
Power Metal will develop projects internally or through strategic joint
ventures until a project becomes ready for disposal through outright sale or
separate listing on a recognised stock exchange thereby crystallising the
value generated from our internal exploration and development work.
Value generated through disposals will be deployed internally to drive the
Company's growth or may be returned to shareholders through share buy backs,
dividends, or in-specie distributions of assets.
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 31 MARCH 2023
6 months 6 months Year
ended ended ended
31-Mar-23 31-Mar-22 30-Sep-22
(unaudited) (unaudited) (audited)
Note £'000 £'000 £'000
Revenue 1 198 37
Gross profit 1 198 37
Operating expenses (1,016) (1,330) (3,127)
Fair value gains through profit or loss (537) (405) 309
Gain on disposal of joint venture 48 - -
Loss from operating activities (1,504) (1,537) (2,781)
Share of post-tax losses of equity accounted joint ventures (108) (175) (167)
Loss before taxation (1,612) (1,712) (2,948)
Taxation - - -
Loss for the period from continuing operations (1,612) (1,712) (2,948)
Items that will or may not be reclassified to profit or loss
Capital contribution - - 2,794
Items that will or may be reclassified to profit or loss
Exchange translation (171) 78 18
Total other comprehensive income (171) 78 2,812
Total comprehensive expense for the period (1,783) (1,634) (136)
Loss for the period attributable to:
Owners of the parent (1,495) (1,691) (2,256)
Non-controlling interests (117) (21) (692)
(1,612) (1,712) (2,948)
Total comprehensive expense attributable to:
Owners of the parent (1,629) (1,613) 82
Non-controlling interests (154) (21) (218)
(1,783) (1,634) (136)
Earnings per share from continuing operations attributable to the ordinary
equity holder of the parent:
Basic and diluted loss per share (pence) 4 (0.09) (0.12) (0.15)
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2023
Note 31-Mar-23 (unaudited) 31-Mar-22 30-Sep-22
£'000 (unaudited) (audited)
£'000 £'000
Assets
Intangible assets 9,438 2,782 7,138
Investments in associates and joint ventures 278 156 402
Financial assets at fair value through profit or loss 469 3,539 1,620
Property, plant & equipment 40 22 33
Non-current assets 10,225 6,499 9,193
Financial assets at fair value through profit or loss 3,603 66 2,384
Assets classified as held for sale 78 - 1,124
Trade and other receivables 287 1,240 346
Cash and cash equivalents 427 1,435 1,560
Current assets 4,395 2,741 5,414
Total assets 14,620 9,240 14,607
Equity
Share capital 5 8,190 7,918 8,065
Share premium 25,144 21,871 23,312
Capital redemption reserve 5 5 5
Capital contribution reserve 2,322 - 2,322
Share based payments reserve 1,699 1,576 1,638
Foreign exchange reserve (44) 150 90
Accumulated losses (25,215) (23,179) (23,742)
Total 12,101 8,341 11,690
Non-controlling interests 1,890 (327) 2,066
Total equity 13,991 8,014 13,756
Liabilities
Trade and other payables 629 1,226 851
Current liabilities 629 1,226 851
Total liabilities 629 1,226 851
Total equity and liabilities 14,620 9,240 14,607
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 31 MARCH 2023
Share capital Share premium Capital redemption reserve £'000 Capital Contribution Share based payment reserve Exchange reserve Retained deficit £'000 Total Non-Controlling Interests Total Equity £'000
£'000
£'000
£'000
£'000
£'000
£'000 £'000
Balance at 1 October 2022 (audited) 8,065 23,312 5 2,322 1,638 90 (23,742) 11,690 2,066 13,756
Loss for the period - - - - - - (1,495) (1,495) (117) (1,612)
Total other comprehensive expense - - - - - (134) - (134) (37) (171)
Total comprehensive expense for the period - - - - - (134) (1,495) (1,629) (154) (1,783)
Issue of ordinary shares 125 1,878 - - - - - 2,003 - 2,003
Cost of share issues - (46) - - - - - (46) - (46)
Share-based payments - - - - 61 - - 61 - 61
Non-controlling interest adjustment - - - - - - 22 22 (22) -
125 1,832 - - 61 - 22 2,040 (22) 2,018
Balance at 31 March 2023 (unaudited) 8,190 25,144 5 2,322 1,699 (44) (25,215) 12,101 1,890 13,991
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 31 MARCH 2022
Share capital Share premium Capital redemption reserve Share based payment reserve £'000 Exchange reserve Accumulated losses Total Non-controlling interests £'000 Total Equity £'000
£'000
£'000
£'000
£'000
£'000
£'000
Balance at 1 October 2021 (audited) 7,705 18,437 5 1,541 72 (21,488) 6,272 (306) 5,966
Loss for the period - - - - - (1,691) (1,691) (21) (1,712)
Total other comprehensive expense - - - - 78 - 78 - 78
Total comprehensive expense for the period - - - - 78 (1,691) (1,613) (21) (1,634)
Issue of ordinary shares 213 3,496 - - - - 3,709 - 3,709
Cost of share issues - (62) - - - - (62) - (62)
Share-based payments - - - 35 - - 35 - 35
213 3,434 - 35 - - 3,682 - 3,682
Balance at 31 March 2022 (unaudited) 7,918 21,871 5 1,576 150 (23,179) 8,341 (327) 8,014
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2022
Share capital Share premium Capital redemption reserve Capital Contribution Share based payment reserve £'000 Exchange reserve Retained Deficit Total Non-controlling interests £'000 Total Equity £'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Balance at 1 October 2021 (audited) 7,705 18,437 5 - 1,541 72 (21,488) 6,272 (306) 5,966
Loss for the year - - - - - - (2,258) (2,258) (690) (2,948)
Total other comprehensive expense - - - - - 18 - 18 - 18
Capital Contribution - - - 2,322 - - - 2,322 472 2,794
Total comprehensive expense for the period - - - 2,322 - 18 (2,258) 82 (218) (136)
Issue of ordinary shares 360 4,999 - - - - - 5,359 - 5,359
Cost of share issues - (124) - - - - - (124) - (124)
Share-based payments - - - - 101 - - 101 - 101
Warrant exercises - - - - (4) - 4 - - -
Non- controlling interest adjustment on step disposal of subsidiaries - - - - - - - 2,590 2,590
360 4,875 - - 97 - 4 5,336 2,590 7,926
Balance at 30 September 2022 (audited) 8,065 23,312 5 2,322 1,638 90 (23,742) 11,690 2,066 13,756
POWER METAL RESOURCES PLC
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 31 MARCH 2023
6 months 6 months Year
ended ended ended
31-Mar-23 31-Mar-22 30-Sep-22 (audited) £'000
(unaudited) (unaudited)
£'000 £'000
Cash flows from operating activities
Loss for the period (1,612) (1,712) (2,948)
Adjustments for:
- Fair value adjustment 537 405 (309)
- Share of post-tax losses of equity accounted 108 175 167
joint ventures
- Disposals (47) 378 245
- Equity settled share-based payments 17 35 101
- Depreciation 2 - -
- Foreign exchange differences (150) 78 11
(1,145) (641) (2,733)
Changes in working capital:
- Trade and other receivables (9) (1,063) (250)
- Trade and other payables (222) 908 477
Net cash used in operating activities (1,376) (796) (2,506)
Cash flows from investing activities
Purchase of intangibles (408) (295) (1,530)
Investment in financial assets at fair value through profit or loss - (321) (426)
Investment in Joint Ventures (194) (165) (188)
Proceeds from investment disposals - 171 -
Purchase of property, plant and equipment (9) (20) (32)
Net cash used in investing activities (611) (630) (2,176)
Cash flows from financing activities
Proceeds from issue of share capital 900 1,643 3,211
Shares issued to non-controlling interests by subsidiary - - 1,875
Issue costs (46) (63) (125)
Net cash flows from financing activities 854 1,580 4,961
Net increase/(decrease) in cash and cash equivalents (1,133) 154 279
Cash and cash equivalents at beginning of period 1,560 1,281 1,281
Cash and cash equivalents at end of period 427 1,435 1,560
Details of significant non-cash transactions are disclosed in note 5.
NOTES TO THE CONSOLIDATED INTERIM FINANCIAL REPORT
1. Reporting entity
Power Metal Resources plc is a company domiciled in the United Kingdom. The
unaudited consolidated interim financial report of the Group as at and for the
period ended 31 March 2023 comprises the results of the Company and its
subsidiaries. The Group primarily is involved in the exploration and
exploitation of mineral resources in Australia, Botswana, Canada, Cameroon,
the DRC, USA and Tanzania.
2. Basis of preparation
(a) Statement of compliance
As permitted, IAS 34, 'Interim Financial Reporting' has not been applied in
this interim report.
The financial information presented in this interim report has been prepared
using accounting policies that are expected to be applied in the preparation
of the financial statements for the year ending 30 September 2023.
These policies are in accordance with the recognition and measurement
principles of International Financial Reporting Standards, International
Accounting Standards, and Interpretations (collectively IFRS) issued by the
International Accounting Standards Board as endorsed for use in the United
Kingdom, and these principles are disclosed in the Financial Statements for
the year ended 30 September 2022.
The interim results have been prepared on a going concern basis. The financial
information in this interim report does not constitute statutory accounts
within the meaning of Section 435 of the Companies Act 2006. The 2023 interim
financial report has not been audited.
The Annual Report and Financial Statements for 2022 have been filed with the
Registrar of Companies. The Independent Auditors' Report on the Annual Report
and Financial Statement for 2022 was unqualified and did not contain a
statement under 498(2) or 498(3) of the Companies Act 2006.
The interim results were approved by the Board of Directors on 27 June 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 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 consolidated financial statements as at and for the year ended 30
September 2022.
(c) Going concern
The interim financial report has been prepared on a going concern basis.
Although the Group's assets are not generating revenues, the Directors
believe, having considered all available information, including the Company's
proven ability to raise further equity funds from its supportive shareholder
base, that the Group will have sufficient funds to meet its expected committed
and contractual expenditure for the foreseeable future. Thus, the Directors
continue to adopt the going concern basis of accounting in preparing the
interim financial report for the period ended 31 March 2023.
3. Significant accounting policies
The accounting policies applied by the Group in this consolidated interim
financial report are the same as those applied by the Group in its
consolidated financial statements as at and for the year ended 30 September
2022.
4. Earnings per share
Basic loss per share
The calculation of basic loss per share is based on the loss attributable to
ordinary shareholders of the parent of £1,495,000 (2022: £1,691,000), and a
weighted average number of ordinary shares in issue of 1,681,431,009 (2022:
1,404,603,204).
5. Issues of Equity
In November 2022, the company issued 46,134,171 new ordinary shares of 0.1p at
a price of 1.75 pence per share, for the initial consideration of the
acquisition of an additional 58.7% interest in Kalahari Key Mineral
Exploration Pty Limited. The company also issued warrants over 46,134,171 new
ordinary shares at a price of 3.5 pence with an expiry date of 18 May 2024.
In January 2023, 2,500,000 new ordinary shares of 0.1p each were issued at a
price of 1.5 pence per share for the acquisition of the 4,222-hectar Doerksen
Bay graphite project located in Saskatchewan, Canada.
In January 2023, Power Metal raised £900,000 before expenses through the
issue of 64,285,714 new ordinary shares of 0.1p each in the company at an
issue price of 1.4 pence per share. Each financing share has an attaching
warrant to subscribe for one new ordinary share of 0.1 pence each in the
Company at an exercise price of 2.0 pence per share with a 24-month term from
30 January 2023 creating 64,285,714 Financing Warrants.
In March 2023, the company issued 11,458,872 new ordinary shares at an issue
price of 2.25 pence per share relating to payment for drill costs in relation
to the recently completed Molopo Farms Complex diamond drill programme in
Botswana.
At the period end, the Company had 1,739,033,678 Ordinary Shares in issue (30
September 2022: 1,614,654,921).
At the date of this interim report, the Company had 2,064,671,913 Ordinary
Shares in issue.
**Ends**
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