REG - Premier African Min - Final Results
30/06/2022 14:00
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RNS Number : 8637Q Premier African Minerals Limited 30 June 2022
30 June 2022
Premier African Minerals Limited
Final Results
Premier African Minerals Limited ("Premier" or the "Company"), the AIM-traded,
multi-commodity mining and natural resource development company focused in
Southern and Western Africa, is pleased to announce publication of its
audited Annual Report and Accounts for the year ended 31 December 2021 (the
"Annual Report").
The Annual Report is available on the Company's
website, www.premierafricanminerals.com
(http://www.premierafricanminerals.com/) , and is in the process of being
posted to Shareholders.
The Annual Report for the year ended 31 December 2021 is set out in full
below.
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018.
The person who arranged the release of this announcement on behalf of the
Company was George Roach.
Enquiries:
George Roach Premier African Minerals Limited Tel: +27 (0) 100 201 281
Michael Cornish / Roland Cornish Beaumont Cornish Limited Tel: +44 (0) 20 7628 3396
(Nominated Adviser)
John More/Toby Gibbs Shore Capital Stockbrokers Limited Tel: +44 (0) 20 7408 4090
(Joint Broker)
CEO STATEMENT -Mr George Roach
Reflecting on the past eighteen months and having reviewed our 2021 audited
financials and our most recent interims, I can't help feeling that so much is
changing and so rapidly that this statement is going to be more concerned with
events post year end, than those of the period under review!
Our project at Zulu in Zimbabwe has been front and centre in most of what we
have achieved in 2021. Improved liquidity and escalating interest in spodumene
concentrate, whilst allowing Premier to fund the commencement of a Definitive
Feasibility Study, did not necessarily answer the question as to what future
deal should be considered and what may offer the best value in the longer term
for shareholders. Whilst this was unfolding, a number of unforeseen issues did
not help progress at Zulu either. The return intermittently of COVID and
related travel restrictions and an abnormally wet summer, added their own
complications.
In the latter part of 2021, interest in the Zulu deposit increased
dramatically and a series of negotiations followed. This only increased the
difficulty in identifying the best possible deal to extract value for our
shareholders. Ultimately, Premier took the decision to retain ownership of
Zulu and to seek to bring the deposit into production without further dilution
to shareholders on the back of a pre-paid sales contract. Step one in this
process was to team up with a company that had those capabilities. At one
point, I was involved with eleven separate negotiations with people all
wanting Zulu! At the end of the day Suzhou TA&A agreed to take a placement
into Premier direct at a substantial premium to the then trading price, and
this has allowed us to dramatically improve the exploration activities at
Zulu.
In our RNS 13 June 2022, I set out Premier's intention to commission a high
capacity pilot plant and the rationale therefor; in essence that, the advanced
exploration and test work coupled to the shortage of SC6 and the price for
this commodity have all combined to create a unique opportunity for Zulu to be
in production with SC6 from Q1 2023. In our latest RNS OF 24 June 2022, I
have been able to confirm that this pilot plant option is now a reality and
Premier is now expected to be fully funded to bring Zulu into production in
early 2023.
Sadly, RHA has not progressed but, the control of the Zimbabwe states 51% now
resides in the Ministry of Mines and there have been encouraging negotiations
with an expectation that a workable agreement will be reached and that there
is a reasonable prospect that after some additional exploration work, this
could return to production in early 2023 as well. The price of wolframite
remains good and there is a window to bring this mine back into production.
Premier concluded a JV agreement with Li3 Resources Inc to earn in up to 50%
of the ownership of the claims previously acquired in the Mutare greenstone
belt. Exploration activities have commenced and we look forward to results of
those efforts in the near future.
George Roach
Acting Chairman and Chief Executive Officer
30 June 2022
STRATEGIC REPORT
The strategic report provides a detailed assessment of the activities of the
Company during the period under review. It also details the main objectives of
the Company related to our portfolio of assets. The principal risks and
uncertainties associated with our activities are outlined in a specific
principal risks and uncertainties section.
RHA
49% Interest owned by Premier
51% Locally indigenized owned by National Indigenisation and Economic
Empowerment Fund ("NIEEF")
Sadly, little changed once again, although in further reviews of the resource,
prompted by improved pricing for Wolframite, the option of open pit operations
being resumed targeting alternative lode structures to those originally mined
some years ago, represented a viable alternative, but something I would only
consider after additional exploration drilling to confirm the on strike
extensions of the lodes in question. Coupled to limited plant modifications
indicated from test work concluded during the year, an independent review
indicated that the mine could potentially operate profitably. The stumbling
block remains that Premier cannot reasonably be expected to fund this whilst
owning a minority stake.
In subsequent discussions with the Minister of Mines, there are positive signs
for a new agreement with the Government that may still see this mine back in
production in 2023. I will be updating on this regularly.
Recoverability of RHA Mine Assets
The RHA mine assets remain fully impaired at this time and are likely to so
remain until we are able to conclude the discussions underway at present.
Zulu Lithium and Tantalum Project
Much was achieved and much changed during the year under review. Exploration
activities at site and test work conducted in Germany by Anzaplan, together
with early drill results continued to support our confidence in the Zulu
Project.
After the formal grant of the EPO, Premier was able to self-fund the initial
stages associated with this extended exploration programme and also kickstart
DFS related activities. In terms of the DFS, this would be an extension to the
Scoping Study completed in 2017 that had indicated no fatal flaws and
recommended further study with a view to eventual mine development. The rising
demand for spodumene concentrates and the escalating price thereof, drove
strong interest from many parties all wanting an interest and/or possible
acquisition of the Zulu Project. After long and hard consideration, we took
the view that the best potential return for shareholders likely lay in
retaining ownership and looking to develop the project further before reaching
any definitive agreement with any party.
I have covered above the acceptance of the subscription into the company from
Suzhou TA&A and the substantial boost that has given our activities.
Important was the fact that Premier was fully funded and was able to take a
much sounder view of the exploration activities in particular, without
persistent pressure to rush interim results to market. The exploration program
had been difficult. Influenced by covid interruptions and then torrential
summer rains that together with further delays in receipt of assays, left us
well behind our original drilling targets. The subscription allowed us to
dramatically accelerate the exploration activities and also allowed time to
completely review all assays and other activities undertaken. Shortcomings
identified have been attended to, corrections made to ore body resource models
as needed and confirmatory and validation assays are well advanced. Our
internal Competent Person and project manager has indicated that he continues
to target a SAMREC compliant indicated resource of 8 to 10 MT @>1% Li2O
from the spodumene bearing pegmatites, sufficient to support the pilot plant
phase producing 5,000 ton per month of SC6. The ore body extends at depth and
on strike in both directions and updates on the overall projected size of this
ore body will follow.
In the past few days, Premier announced the funding agreement for the
construction of a large-scale pilot plant to produce SC6 from early 2023. The
cost estimate of $34 million will be fully funded from a pre-paid purchase of
SC6, and the projected production can potentially, based upon on current
spodumene prices, both fully repay the pre-paid amount inside of twelve months
and place Premier on a sound and profitable basis going forward. As important
is that the pilot plant operation will allow optimisation and completion of
detailed further test work on ancillary revenue streams that will include
tantalum concentrate, a technical grade petalite and possibly a
Caesium/Rubidium rich mica/lepidolite concentrate.
The pilot plant project has been launched with an initial payment of 15% of
the plant construction cost. At the same time site construction work is
already underway. The full staff and ancillary accommodation, workshops,
service areas and layout are expected to complete by 30 September 2022. Mine
dam, water reticulation, pilot plant base structures, tailings facilities and
power generation infrastructure construction commence July 2022 and first
equipment is expected to start arriving at site from November 2022. Plant
components are pre-assembled in South Africa before stripping and shipment to
site. The plant is modular and this will facilitate both speed of assembly and
provides flexibility in the test phases that will follow installation. The
final components of the plant will be delivered to site late in December 2022
with the construction of the dam to provide water completed by end of December
2022 and completion of the plant by end of January 2023. On this basis, our
expectation of first shipments will occur by 31 March 2023 is entirely
reasonable.
We will be providing regular progress reports and if adequate bandwidth
becomes available at the project site, a periodic live feed will be
considered.
As production date approaches, we will provide guidance related to anticipated
production levels updated to prices at that time.
Extended Lithium Portfolio
Potentially, a hidden gem. Whilst considered of little value when Premier
acquired a gold prospect in Mozambique and this portfolio of hard-rock lithium
assets located in Zimbabwe from Lithium Consolidated Ltd ("Li3") on the 28
July 2020, present circumstances have changed that perception entirely. Little
work was concluded in the year to December 2021 on these prospects and no work
was possible in Mozambique due to the mass displacement of people south from
Cabo del Gardo. In events post year end, Premier concluded a JV buy-in
agreement as announced in our RNS 25 April 2022 and since that date we have
deployed an exploration team to assess and determine where the most
prospective regions lie. Early mapping and surface sampling is encouraging.
Drill target identification continues and preliminary results can be expected
during Q3 2022.
MN Holdings Limited ("MNH")
Little has changed in regard to Otjozondu and it remains a disappointment that
neither has Premier been able to advance the present 19% interest in MNH, nor
has the mine operation improved. Fundamentally, this remains a sound prospect
with a sound and potentially profitable future when the operation is
recapitalised.
In the unaudited management accounts for 6 months ended 31 December 2021,
Otjozondu reported revenue of approximately N$26 million (equivalent
to $1.7 million) and an operating loss before tax (and interest charges to
group companies) of approximately N$45.6 million (equivalent to $3.0
million). Total assets as at the same date amounted to approximately N$130
million (equivalent to $8.5 million).
As further reported in Note 12, Premier has provided Otjozondu and its related
party, Ebenezer Farm, with a small working and expansion capital facility.
Circum Minerals Limited ("Circum")
The status in Ethiopia has effectively halted operations at Circum during the
year to 31 December 2021 and little was advanced. In events after the period
end, much has changed. Our RNS 22 February 2022 set out the terms under which
Premier's holding in Circum was consolidated into Vortex. Subsequent to this
consolidation, the collective shareholders of Vortex have significant
protection from a weak minority position and will enjoy an equitable
distribution in any proceeds from a cash generative event. The moves toward
peace in Ethiopia and the embargoes on potash from Russia and Belarus have
strengthened potash prices and there is growing interest in development of the
Circum deposit. Apart from this, the major shareholders of Circum, including
Vortex have agreed a final date by when a listing will be sought if no other
liquidity event has occurred.
I look forward to further updates during the year
Funding
During the reporting period we raised net proceeds of $3.609 million (2020:
$2.343 million).
Principal activities and strategic review of the business
The principal activity of Premier and its subsidiary companies (the Group)
during the year under review is the mining, exploration, evaluation
development and investment in natural resource properties on the African
continent.
Premier was incorporated on 21 August 2007 in the British Virgin Islands (BVI)
as a BVI business company with number 1426861. The registered office is
Craigmuir Chambers, PO Box 71, Road Town, Tortola, British Virgin Islands. The
Company was admitted to trading on the London Stock Exchange's AIM Market on
10 December 2012.
Objectives
During the current year, the primary focus will be:
· Look to acquire potentially cash generative assets.
· To progress the DFS studies at Zulu and implement the pilot plant
mining operations.
· Continue to engage directly with MNH.
· Definitively settle the status at RHA and either reopen the mine
or relocate our plant.
· Identify and secure high value exploration targets in other
jurisdictions.
Principal risks and uncertainties
The Group is subject to a number of risks and uncertainties which could have a
material effect on its business, operations, or future performance, including
but not limited to:
Credit Risk
Credit risk is the risk of potential loss to the Company if counterparty to a
financial instrument fails to meet its contractual obligations. The Company's
credit risk is primarily attributable to its liquid financial assets,
including cash, receivables, and balances receivable from the government. The
Company limits the exposure to credit risk in its cash by only investing its
cash with high-credit quality financial institutions in business and savings
accounts, guaranteed investment certificates and in government treasury bills
which are available on demand by the Company for its programs. The Company
does not invest in money market funds. The Company has no risk exposure to
asset backed commercial paper or auction rate securities.
Refer to note 29 for the company's exposure to credit risk.
Liquidity Risk
Liquidity risk is the risk that the Company will not have the resources to
meet its obligations as they fall due. The Company manages this risk by
closely monitoring cash forecasts and managing resources to ensure that it
will have sufficient liquidity to meet its obligations. Also refer to the
going concern section below.
Refer to note 29 for the company's exposure to liquidity risk.
Operating Risks
The activities of the Group are subject to all of the hazards and risks
normally incidental to exploring and developing natural resource projects.
These risks and uncertainties include, but are not limited to environmental
hazards, industrial accidents, labour disputes, geo-political risks,
encountering unusual or unexpected geologic formations or other geological or
grade problems, unanticipated changes in rock formation characteristics and
mineral recovery, encountering unanticipated ground or water conditions, land
slips, flooding, periodic interruptions due to inclement or hazardous weather
conditions and other acts of God or un-favourable operating conditions and
losses.
Should any of these risks and hazards affect the Group's exploration,
development or mining activities, it may cause the cost of production to
increase to a point where it would no longer be economic to extract minerals
from the Group's properties, require the Group to write-down the carrying
value of one or more of its assets, cause delays or a stoppage of mining and
processing, result in the destruction of mineral properties or processing
facilities, cause death or personal injury and related legal liability, any
and all of which may have a material adverse effect on the Group.
Early-stage Business Risk
The Group's success will depend on its ability to raise capital and generate
cash flows from production in the future at MNH and potentially RHA should
NIEEF meet their funding obligations. The board of directors manages this risk
by monitoring cash levels and reviewing cash flow forecasts on a regular
basis.
Market Risk (exchange rates, commodity, and equity)
Market risk is the risk of loss that may arise from changes in market factors
such as interest rates, foreign exchange rates, and commodity and equity
prices. These fluctuations may be significant.
Interest Rate Risk: The Company is exposed to interest rate risk to the extent
that its cash balances bear variable rates of interest. The interest rate
risks on cash and short-term investments and on the Company's, obligations are
not considered significant.
Foreign Currency Risk: The Company is exposed to the financial risk related to
the fluctuation of foreign exchange rates against the Company's functional
currency, which is the United States dollar ("USD"). The Company expects to
continue to raise funds in the United Kingdom. The Company conducts its
business in Zimbabwe with a significant portion of expenditures in that
country historically denominated in USD and now also in RTGS Dollars
("RTGS$"). The introduction of the RTGS$ during the 2019 financial year has
resulted in the devaluation of the RTGS$ against the US Dollar. This
devaluation has also resulted in the Zimbabwean economy going into
hyperinflationary status. The RTGS$ denominated assets and liabilities are
inflation adjusted at each reporting period yielding foreign exchange gains or
losses on conversion to USD. Additionally, a portion of the Company's business
is conducted in South African Rands ("ZAR"). As such, it is subject to risk
due to fluctuations in the exchange rates between the USD and each of the
RTGS$, ZAR and GBP. A significant change in the currency exchange rates
between the USD relative to foreign currencies could have an effect on the
Company's results of operations, financial position, or cash flows. The
Company has not hedged its exposure to currency fluctuations.
Commodity Price Risk - While the value of the Company's core mineral resource
properties, RHA and Zulu are related to the price of tungsten and lithium and
the outlook for these minerals, the Company currently does not have any
substantially owned operating mines and hence does not have any hedging or
other commodity-based risks in respect of its operational activities. The
Company minority interest in MNH results in limited control of how MNH
mitigate the risk associated with Manganese price fluctuations.
Refer to note 29 for the company's exposure to market risk.
Early-stage Project Risk
RHA moved into production during 2017, which was then suspended on 9 January
2018. Zulu is at an early stage of development. In advancing these projects to
the stage where they may be cash generative, many risks are faced, including
the inherent uncertainty of discovering commercially viable reserves, the
capital costs of exploration, competition from other projects seeking
financing and operating in remote and often politically unstable environments.
While discovery of a mineral deposit may result in substantial rewards, few
properties that are explored are ultimately developed into economically viable
operating mines. Major expenditure may be required to establish reserves and
it is possible that even preliminary due diligence will show adverse results,
leading to the abandonment of projects. Whether a mineral deposit will become
commercially viable depends on a number of factors, some of which are the
particular attributes of the deposit, proximity to infrastructure, financing
costs and governmental regulations. The effect of these factors can only be
estimated and cannot be accurately predicted.
Environmental Risks and Hazards
All phases of the Group's operations are subject to environmental regulation
in the areas in which it operates. Environmental legislation is evolving in a
manner that may require stricter standards and enforcement, increased fines
and penalties for non-compliance, more stringent environmental assessments of
proposed projects and a heightened degree of responsibility for companies and
their officers, directors, and employees. There is no assurance that existing
or future environmental regulation will not materially adversely affect the
Group's business, financial condition, and results of operations.
Environmental hazards may exist on the properties on which the Group holds
interests that are unknown to the Group at present. The Board manages this
risk by working with environmental consultants and by engaging with the
relevant governmental departments and other concerned stakeholders.
Licencing Risk
The Company's exploration and development activities are dependent upon the
grant of appropriate licences, concessions, leases, permits and regulatory
consents which may be withdrawn or made subject to limitations or performance
criteria. Such licences and permits are as a practical matter subject to the
discretion of the applicable Government or Government office. The Group must
comply with known standards, existing laws and regulations that may entail
greater or lesser costs and delays depending on the nature of the activity to
be permitted. The interpretations, amendments to existing laws and
regulations, or more stringent enforcement of existing laws and regulations
could have a material adverse impact on the Group's results of operations and
financial condition. Whilst the Company continually seeks to do everything
within its control to ensure that the terms of each licence are met and
adhered to, third parties may seek to exploit any technical breaches in
licence terms for their own benefit. There is a risk that negotiations with a
Government in relation to the grant, renewal or extension of a licence may not
result in the grant, renewal or extension taking effect prior to the expiry of
the previous licence period, and there can be no assurance of the terms of any
extension, renewal, or grant.
Political and Regulatory Risk
The Group's operating activities in Africa, notably in Zimbabwe, are subject
to laws and regulations governing expropriation of property, health and worker
safety, employment standards, waste disposal, protection of the environment,
mine development, land and water use, prospecting, mineral production,
exports, taxes, labour standards, occupational health standards, toxic wastes,
the protection of endangered and protected species and other matters. The
Group is dependent on the political and economic situation in these countries
and may be adversely impacted by political factors such as expropriation, war,
terrorism, insurrection, and changes to laws governing mineral exploration and
operations.
Internal Control and Financial Risk Management
The Board has overall responsibility for the Group's systems of internal
control and for reviewing their effectiveness. The Group maintains systems
which are designed to provide reasonable but not absolute assurance against
material loss and to manage rather than eliminate risk.
The key features of the Group's systems of internal control are as follows:
➢ Management structure with clearly identified responsibilities.
➢ Production of management information presented to the Board.
➢ Day to day hands on involvement of the Executive Directors and Senior
Management.
➢ Regular board meetings and discussions with the non-executive directors.
The Group's activities expose it to a number of financial risks including cash
flow risk, liquidity risk and foreign currency risk. The Group has identified
certain short coming in the financial control systems, which are currently in
the process of being addressed.
Disclosure of management's objectives, exposure, and policies in relation to
these risks can be found in note 29 to these financial statements.
Environmental Policy
The Group is aware of the potential impact that its subsidiary companies may
have on the environment. The Group ensures that it complies with all local
regulatory requirements and seeks to implement a best practice approach to
managing environmental aspects.
The RHA Mine located in Zimbabwe was granted approval of its Environmental
Impact Assessment and was permitted to undertake mining operations by the
Environmental Management Agency of Zimbabwe.
Health and Safety
The Group's aim is to achieve and maintain a high standard of workplace
safety. In order to achieve this objective, the Group provides ongoing
training and support to employees and sets demanding standards for workplace
safety.
Covid-19
The Board recognises that the emergence and spread of new coronavirus strains
represents a continuing risk to the Company's operations. The Board has also
received assurances from the Company's key service providers and management in
respect of their ongoing activities with our operations and steps are being
taken to guarantee the ongoing efficiency of our operations while ensuring the
safety and well-being of our employees.
With expanding vaccine programme, the outlook is cautiously positive, but the
Board will continue to monitor developments as they occur.
Going Concern
These consolidated financial statements are prepared on the going concern
basis. The going concern basis assumes that the Group will continue in
operation for the foreseeable future and will be able to realise its assets
and discharge its liabilities and commitments in the normal course of
business.
The Directors have prepared cash flow forecasts for the period ending 30 June
2023, on the basis of the following considerations, inter alia:
RHA
· The Company has not funded any of the activities at RHA since 1
July 2019, apart from essential care and maintenance costs.
Zulu
· During March 2021, the EPO was granted and subsequently a
definitive feasibility study (DFS) has commenced.
· The Company accepted a direct placement from Suzhou TA&A that
fully funds the ongoing DFS and all Premier activities to postproduction
start-up at Zulu that is projected for Q1 2023
· The Company has secured funding to complete the establishment of
a Pilot Plant at Zulu as announced on 24 June 2022.
MNH
· The Group is anticipating deriving a return on its current
investment in MNH in the latter portion of 2022.
· The Company has received the unaudited management accounts as at
31 December which reflects a loss of N$45.6 million (US$3.0 million) for the 6
months then ended.
The Group
· During 2021 the Group issued 1,625,000,000 shares at an average
price of 0.172p per share raising a total of $2.8 million. This cash is being
used to commence the Zulu DFS and additional exploration required in terms of
the EPO.
· The Company will seek to diversify its operations and risk
profile and limit the funds that need to be raised through equity placements
to provide necessary funding for the Company's significantly reduced fixed
overhead.
· In March 2022 the company issued the balance of its authorised
share capital for a total of £12 million. These funds are being used to
complete the DFS at Zulu Lithium.
Refer to note 5 for further information.
George Roach
Acting Chairman and Chief Executive Officer
30 June 2022
Management Team
CEO - MR GEORGE ROACH
George has extensive experience in the natural resources sector in Africa. He
has successfully obtained licenses and concluded mineral exploration and
exploitation agreements in the entire SADAC region, Ethiopia and most of CEMAC
and ECOWAS regions. Under the auspices of Exploration Services, he has
provided consultancy to prospective exploration companies and has acted in
significant capacities for several start-ups that have subsequently listed on
AIM and TSX-V. Prior to founding Premier, George was the Managing Director
Africa, for Uramin Inc.
COO - Mr Errico Vascotto
Errico is an accomplished and qualified Mining Engineer with more than 40
years in the mining industry. Errico also has a MBA from the University of
Southern Queensland, Australia with Project Management as a speciality. He
has worked on both greenfield and brownfield projects globally. In addition
to direct mining experience, Errico has gained experience in mining
construction, providing strategic project leadership in line with industry
best practice.
CFO - Mr Tomas Apetauer
Since qualifying as a C.A. (S.A.), Tomas has gained extensive experience in a
diverse range of industries including finance, engineering consulting,
corporate finance and as an international trainer. As Premier's chief
financial officer, he brings the skills gained through corporate turnaround
strategies, multi-million dollar capital raises and buy-outs primarily focused
on the African market.
Country Manager - Mr Jabulani Chirasha
A qualified Metallurgical Engineer with over 30 years' experience in mining
and process engineering. Prior to joining Premier, Jabulani was a senior
manager at Anglo American in Zimbabwe. Jabulani has authored a number of
international papers on mining and process technology and facilitated at
international mining conferences as a speaker.
Corporate Secretary - Mr Brendan Roach
Brendan holds a B.Com LLB and MA(Law). He manages the full function of
corporate affairs for Premier and acts as our international Legal Counsel.
Exploration Manager - Mr Bruce Cumming
With more than 40 years' experience Bruce is an accomplished, SACNASP
registered Geologist. Bruce qualified with a BSc Hons degree from the
University of Cape Town and is a member of the GSSA. Bruce has extensive
exploration project management experience and has worked in various capacities
in diverse African countries. He has a long history with Premier African
Minerals.
Directors
CEO - MR GEORGE ROACH
George has extensive experience in natural resource business development in
Africa. He has held positions in and/or initiated a number of start-up
businesses listed on AIM and/or TSX-V.
Mr Wolfgang Hampel - Non executive Director
Wolfgang has more than 27 years' experience in the African, American, European
and Asian exploration and mining industry. He holds a Diploma in Economic
Geology from the Technical University of Munich and is a registered European
Geologist (EurGeol) n*1261, with the European Federation of Geologists.
Mr Godfrey Manhambara - Non Executive Director
A Zimbabwean national with extensive experience in business.
Godfrey was the former Chief Executive of Affretair. In 1999, Godfrey was
appointed as CEO of the Civil Aviation Authority in Zimbabwe, a position he
held until 2001. Currently Godfrey is the Chief Executive of Beta Holding,
the largest infrastructure supply manufacturer in Zimbabwe
Dr Luo Wei - Non Executive Director
Dr Wei has a PhD in Mineral Prospecting and Exploration from Central South
University. With over a decade of experience in the mining and exploration
industry Dr Wei has extensive experience in project management and
optimisation with a focus on resource development.
DIRECTORS REPORT
Results
The audited financial statements for the year ended 31 December 2021 are set
out on pages 29 to 83. The Group reported a profit before and after tax of
$2.298 million for the year ended 31 December 2021 (2020: loss $1.278
million).
The loss before and after tax includes:
· A gross trading profit after depreciation and amortisation is
$nil (2020: $nil).
· Administration expenses amounting to $2.366 million (2020: $1.311
million).
· RHA remains under care and maintenance. In 2019 it was decided to
impair the carrying value in full of the RHA assets. This results in an
impairment in 2021 of $nil (2020: $0.003 million).
· Finance costs amounting to $0.018 million (2020: $0.082 million);
and
· The reversal of the impairment of the Zulu Lithium's intangible
assets of $4.563 million (2020: $nil).
The total comprehensive profit for the year amounted to $2.099 million (2020:
loss $1.369 million)
Dividends
The Directors do not recommend the payment of a dividend in respect of the
year under review.
Fund-raising and capital
During the 2021 financial year net funds of $3.609 million were raised through
direct subscriptions from the issue of new ordinary shares (2020: $2.343
million).
There remains an active and very liquid market for the Group's shares.
Borrowings
During the financial year, Neil Herbert advanced $0.180 million to Premier
African Minerals to facilitate an additional loan to MN Holdings.
Further information on these transactions is included in note 18 and 32.
Other key elements of financial position
The prior year's impairment of the Zulu Lithium Exploration and Evaluation
costs of $4.566 million were reversed based upon the current market conditions
and requirements for Lithium.
The Company's holdings in Circum amount to $6.263 million (2020: $6.263
million).
The Company's holdings in MNH amount to $2.079 million (2020: $2.079 million).
The Company's investment in property, plant and equipment during the year was
$0.154 million (2020: $0.004 million).
Events after the reporting date
At the date these financial statements were approved, the Directors were not
aware of any significant events after the reporting date other than those set
out in note 33 to the financial statements.
Directors
The Directors of Premier who served during the period or subsequently were:
· George Roach (appointed on incorporation April 2007)
· Godfrey Manhambara (appointed 27 September 2017)
· Wolfgang Hampel (appointed 10 April 2018)
· Neil Herbert (appointed 28 August 2019, resigned 30 April 2022)
· Dr Luo Wei (appointed 30 April 2022)
Directors' Fiduciary Statement
The Directors acknowledge their fiduciary duties and consider that they have,
both individually and together, acted in the way that, in good faith, would be
most likely to promote the success of the Company for the benefit of its
members as a whole. In doing so, they have had regard (amongst other matters)
to:
· The likely consequences of any decision in the long term. The
Group's long-term strategic objectives, including progress made during the
year and principal risks to these objectives, are shown in the strategic
report and the key performance indicators.
· The interests of the Company's employees. Our employees are
fundamental to us achieving our long-term strategic objectives.
· The impact of the Company's operations on the community and the
environment. The Group operates honestly and transparently. We consider the
impact on the environment on our day-to-day operations and how we can minimise
this.
· The desirability of the Company maintaining a reputation for high
standards of business conduct. Our intention is to behave in a responsible
manner, operating within the high standard of business conduct and good
corporate governance.
· The need to act fairly as between members of the Company. Our
intention is to behave responsibly towards our shareholders and treat them
fairly and equally so that they may benefit from the successful delivery of
our strategic objectives.
Share capital
Premier's shares are publicly traded on AIM with the stock ticker of PREM. As
at 31 December 2021, the Company's issued share capital consists of
19,418,009,831 (note 19) Ordinary Shares of no par value.
The company does not hold any Ordinary Shares in treasury.
Major Shareholders
As at 30 June 2022 the Company was aware of the following persons who hold,
directly or indirectly, voting rights representing 3% or more of the issued
share capital of the Company to which voting rights are attached:
Name Number of Ordinary Shares % Issued Share Capital
Suzhou TA&A Ultra Clean Technology Co. Ltd 3,000,000,000 13.38%
George Roach*
James Goozee(#) 1,597,514,207 7.1%
1,219,537,846 5.4%
* George Roach and/or structures associated with G Roach.
(# )James Goozee and/or his wife Mrs. Elizabeth Goozee.
There are no restrictions on the transfer of the Company's AIM securities.
_____________________
George Roach
Acting Chairman and Chief Executive Officer
30 June 2022
CORPORATE GOVERNANCE STATEMENT
Premier is committed to maintaining the highest standards in corporate
governance throughout its operations and to ensure all its practices are
conducted transparently, morally, and efficiently. Therefore, and in
accordance with the AIM Rules for Companies (March 2018), Premier will seek to
comply with the provisions of The UK Corporate Governance Code July 2016, as
published by the Financial Reporting Council Limited, to the extent the Board
consider appropriate, given the Company's size, stage of development and
resources (the "Code").
Throughout the Reporting Period, the Company has continued to adhere to this
Code and the following statement sets out how the Company complies or
otherwise departs from the principles of the Code.
Premier constantly seeks to maintain the highest levels of corporate
governance whereby the Company ensures that a periodic review of the Company's
corporate governance is done. Following this recent review, there have been no
corporate governance issues identified by Premier.
Accordingly, the Company has established specific committees and implemented
certain policies, to ensure that:
· It is led by an experienced Board which is collectively
responsible for the long-term success of the Company.
· The Board and the committees have the appropriate balance of
skills, experience, independence, and knowledge of the Company to enable them
to discharge their respective duties and responsibilities effectively.
· The Board establish a formal and transparent arrangement for
considering how it applies the corporate reporting, risk management and
internal control principles and for maintaining an appropriate relationship
with the Company's auditors.
· There is a dialogue with shareholders based on the mutual
understanding of objectives.
During the year, the board of directors held one formal board meeting that was
attended by all members in office. Due to the ongoing medical issues
pertaining to one of the members of the board of directors, the board of
directors have elected to hold a number of informal virtual board calls with
the attendance of most of the directors in office to discuss the operations of
the Company. Since the year end, the board continued to implement the policy
of holding informal board calls as so required and is also in the process of
actively looking to strengthen the board of directors. The various committees
of the Company have continued to meet from time to time in accordance with the
requirements of the Company's ongoing operations.
In addition, the Company has adopted a comprehensive suite of policies
including:
· Anti-corruption and bribery.
· Health and safety.
· Environment and community.
· IT, communications, and systems.
· social media.
The Code follows 5 Main Principles, which are herein assessed in accordance
with Premier commitment to maintain the highest levels of corporate
governance.
1. Leadership
The Role of the Board of Directors
The Board is responsible for the management of the business of the Company,
setting its strategic direction and establishing appropriate policies. It is
the Directors' responsibility to oversee the financial position of the Company
and monitor its business and affairs on behalf of the Shareholders, to whom
they are accountable. The primary duty of the Board is always to act in the
best interests of the Company. The Board also addresses issues relating to
internal control and risk management. The Non-executive Directors bring a wide
range of skills and experience to the Company, as well as independent judgment
on strategy, risk, and performance. The Non-executive Directors are considered
by the Board to be independent at the date of this report. To achieve its
objectives, the Board strictly adheres to the Code.
The Board meets at least three times a year with supplementary meetings held
as required. The agenda for the Board meetings is prepared jointly by the
Chairman and CEO. The Board maintains annual rolling plan ("Agenda") of items
for discussion to ensure that all matters reserved for the Board, with other
items as appropriate, are addressed. The agenda, with all accompanying
documents, generally includes the following:
· Review of previous minutes.
· Discussion on various project activities and market conditions.
· Management Accounts and Financial position.
· Corporate Matters.
· Other business matters that Board members can freely raise beyond
the defined Agenda.
The Annual Accounts of Premier best reflects the Board key types of decisions
that the Board are required to take in their pursuant of maintaining the
highest levels of corporate governance. The following matters are reserved for
the Board.
· Strategy, Policy and Management.
· Group Structure and capital requirements.
· Financial reporting and controls.
· Internal and External controls.
· Transactions and Commercial Contracts including delegation
authority.
· Board structure.
· Corporate governance matters.
Premier has established varies committees to assist the Board in maintain the
highest levels of corporate governance. Of these committees, the following two
strongly assist the decision making of the Board.
Audit Committee
The Audit Committee ("AC"), which comprises of George Roach and is chaired by
Godfrey Manhambara, is responsible for the appointment of auditors and the
audit fee, and for ensuring that the financial performance of the Company is
properly monitored and reported. The Audit Committee, inter alia, meets with
the Company's external auditor and its senior financial management to review
the annual and interim financial statements of the Company, oversees the
Company's accounting and financial reporting processes, the Company's internal
accounting controls and the resolution of issues identified by the Company's
auditors.
Other key aspects of the AC include:
· Reviewing the Company's accounting policies and reports produced
by internal and external audit functions.
· Considering whether the Company has followed appropriate
accounting standards and made appropriate estimates and judgements,
considering the views of the external auditor.
· Reporting its views to the board of directors if it is not
satisfied with any aspect of the proposed financial reporting by the Company.
· Reviewing the adequacy and effectiveness of the Company's
internal financial controls and internal control and risk management systems.
· Reviewing the adequacy and effectiveness of the Company's
anti-money laundering systems and controls for the prevention of bribery and
receive reports on non-compliance.
· Overseeing the appointment of and the relationship with the
external auditor.
Remuneration Committee
The Remuneration Committee comprises of George Roach and chaired by Godfrey
Manhambara. The Remuneration Committee assumes general responsibility for
assisting the Board in respect of remuneration policies for Premier. The
Committee reviews and recommends remuneration strategies for the Company and
proposals relating to compensation for the Company's officers, directors and
consultants and assesses the performance of the officers of the Company in
fulfilling their responsibilities and meeting corporate objectives. It has the
responsibility for, inter alia, administering share and cash incentive plans
and programmes for Directors and employees and for approving (or making
recommendations to the Board on) share and cash awards for Directors and
employees.
The Committee is satisfied that the advice received has been objective and
independent as at the date of this report.
The Division of Responsibility of the Board of Directors
It is important that the Board itself contains the right mix of skills and
experience to deliver the strategy of the Company. The roles of the Chairman
and Chief Executive Officer ("CEO") are currently exercised by the same person
- following the resignation of Neil Herbert in April 2022, George Roach agreed
to act, for a limited time, as interim chairman. There is no one individual or
group of individuals on the Board that have unfettered powers of discretion
nor is there any undue influence in the collective decision-making ability of
the Board.
The responsibilities of the Chairman, CEO and Non-executive director are set
out in writing and are review by the Board annually to ensure that it remains
relevant and accurate. In brief summary, they are responsible as follows:
· The Chairman's role is to lead and manage the Board and play a
role in facilitating the discussion of the Company's strategy, as set by the
Board. And to effectively promote the success of the Company.
· The CEO's role, including the role of the Technical Director, is
the responsibility of the day-to-day management of the Company's operational
activities, and for the proper execution of the stagey as set by the Board.
· The Non-executive directors, act as a member of the unitary
Board, however, they are required to constructively challenge performance of
management and help develop proposals on strategy, agreeing of goals and the
Company key objectives.
2. Effectiveness
The Composition of the Board
The Board and its committees should have the appropriate balance of skills,
experience, independence, and knowledge of the Company to enable them to
discharge their respective duties and responsibilities effectively.
As such, the Board has been structured to ensure that correct mix of skills
and experience are in place to allow it to operate effectively:
· A Chairman (George Roach on an interim basis), whose primary
responsibility to lead and manage the Board. This remains vital in the
delivery of the Company's corporate governance model. The Chairman has a clear
separation from the day-to-day business of the Company which allows him to
make independent decisions.
· a CEO (George Roach), whose primary focus is communicating, on
behalf of the Company, with shareholders, government entities, and the public.
Leading the development of the Company's short- and long-term strategy.
· a Technical Director (Wolfgang Hampel), whose is responsible for
leading, co-ordinating and optimising the performance of both mining and
exploration services. With a further responsibility for geological and mine
planning activities, his role is critical in ensuring the quality and
efficiency of Premier geology, and
· one independent Non-Executive Director (Godfrey Manhambara).
The Code requires that a smaller company (and which the Company is under the
Code) should have at least two independent non-executive directors. Godfrey
Manhambara is independent under the Code. The Board also regards Wolfgang
Hampel as independent, notwithstanding that he participates in the Company's
share option plan and provides some technical advice to the board. The Board
is satisfied that Wolfgang Hampel acts independently irrespective of these
interests. The Board also notes that no single individual will dominate
decision making and further notes that there has been sufficient challenge of
executive management at meetings of the Board thereby confirming that the
Board is capable of operating effectively.
The Board has not appointed a senior Finance Director but is actively seeking
for the appropriate candidate. However, the board does engage the services of
Tomas Apetauer who is a chartered accountant with extensive audit and
financial management experience. Additionally, the Company has a Company
Secretary in the UK who assists the Chairman and CEO in preparing for and
running effective board meetings, including the timely dissemination of
appropriate information. The Company Secretary provides advice and guidance to
the extent required by the Board on the legal and regulatory environment.
The Nomination Committee ("NC") has been established to regularly review and
ensure that the Board has the appropriate balance of skills, experience, and
knowledge of the Company. NC meets as required to consider the composition of
and succession planning for the Board, and to lead the process of appointments
to the Board. The Committee is made up of George Roach and Wolfgang Hampel and
is chaired by George Roach.
Other key aspects of the NC include:
· regularly reviewing the structure, size, and composition
(including the skills, knowledge, experience, and diversity) of the board and
make recommendations to the board about any changes, succession planning and
vacancies; and
· identifying suitable candidates from a wide range of backgrounds
to be considered for positions on the board.
Appointments to the Board
The appointment of new Directors to the Board is led by the NC who has the
responsibility for nominating candidates for appointment. Both the NC and
Board considers the need for diversity, including equality, and that the new
directors must exhibit the required skills, experience, knowledge, and
independence.
The Board acknowledges that the Company is not in compliance with the Code
whereby the NC should comprise a majority of independent directors. The Board
considers that the NC has a strong enough independent component with Godfrey
Manhambara.
Commitment
The Board requires that all directors should be able to allocate sufficient
time to the Company to discharge their responsibilities in accordance their
letter of appointment. The Company maintains records of each letter of
appointment, which can be inspected at an agreed time, at the Company's
registered office.
The NC is responsible for considering on an annual basis, whether each
director is able to devote sufficient time to their duties.
Development
All directors are required to familiarise themselves with the Board and should
regularly update and refresh their skills and knowledge. The Company provides
each joining director with an induction on the Company. Each induction is
tailored to the specific background and requirements of the new director. In
general, the induction contains information on:
· Structures and operations.
· Board procedures.
· Corporate Governance.
· Details regarding their duties and responsibilities.
Information and Support
As Premier constantly seeks to maintain the highest levels of corporate
governance, it is imperative that information is supplied to the Board in a
form and of a quality appropriate to enable the Board to discharge its duties
in a timely manner. The supply of the information is done by the Chairman with
the assistance of the Company Secretary.
Premier encourage all Board members to seek independent professional advice
(at the reasonable expense of the Company) in the furtherance of their duties.
The Board is given sufficient opportunity to meet with any manager,
consultant, or contractor to gain further insight into Premier.
Evaluation
The Board recognises that it should undertake a formal and rigorous annual
evaluation of its own performance, that of its committees and individual
directors.
The evaluation of the Board's performance is an assessment of the following
key factors:
· The Board structure.
· The Board's performance.
· The Board business strategy.
· Financial reporting and controls.
· Performance monitoring.
· Supporting and advisory roles.
The Board is not in compliance with the Code as the evaluation process is
usually conducted internally due to the size and complexity of the operations
of the Company. Furthermore, the Board believes that internal assessment best
help identify the key strength and weaknesses to allow for effective
evaluation. The Board will continue to assess the internal review process
against the growth of the Company as should the Company grow in size it may
consider getting an independent assessment.
Re-election
The Board believe that all directors should be submitted for re-election at
regular intervals, subject to the continued satisfactory performance of the
Company.
The Director longest in office since their last appointment is required to
retire by rotation or stand for reappointment at the Annual General Meeting
("AGM").
3. Accountability
Financial and Business reporting
A key duty of the Board is to oversee the financial affairs of the Company.
The Financial Statements is the Board's primary means of presenting a fair,
balanced and understandable assessment of the Company's positions that also
best provides the information necessary to allow shareholders to assess the
Company's performance, business model and strategy for that period.
You can view Premier Annual Report and Financial Statements on the Company's
webpage at the following address, www.premierafricanminerals.com
(http://www.premierafricanminerals.com) . Under the Strategic Review section
of the Company's Annual Report and Financial Statements for the year ended
December 2021, the Board set outs the strategic objectives of the Company, how
these will be delivered, Premier business model and how the Company will
generate and preserve value over the longer term for shareholders.
The Board have a reasonable expectation that the Group has adequate resources
to continue in operations or existence for the foreseeable future thus
continues to adopt the going concern basis in preparing its Annual Report and
Financial Statements. Refer to note 5 to the financial statements.
Risk Management and Internal Control
The Board is responsible for determining the nature and extent of the
significant risks it is willing to take in achieving its strategic objectives.
The Board manages the risk through the implementation of internal control
systems.
The Board has identified the following as some of the risks and their
mitigation:
· Credit Risk: Credit risk is the risk of potential loss to the
Company if counterparty to a financial instrument fails to meet its
contractual obligations. The Company's credit risk is primarily attributable
to its liquid financial assets, including cash, receivables, and balances
receivable from the government. The Company limits the exposure to credit risk
in its cash by only investing its cash with high-credit quality financial
institutions in business and savings accounts, guaranteed investment
certificates and in government treasury bills which are available on demand by
the Company for its programs.
· Liquidity Risk: Liquidity risk is the risk that the Company will
not have the resources to meet its obligations as they fall due. The Company
manages this risk by closely monitoring cash forecasts and managing resources
to ensure that it will have enough liquidity to meet its obligations.
· Operating Risks: The activities of the Company are subject to all
of the hazards and risks normally incidental to exploring and developing
natural resource projects. These risks and uncertainties include, but are not
limited to environmental hazards, industrial accidents, Covid-19, labour
disputes, geo-political risks, encountering unusual or unexpected geologic
formations or other geological or grade problems, unanticipated changes in
rock formation characteristics and mineral recovery, encountering
unanticipated ground or water conditions, land slips, flooding, periodic
interruptions due to inclement or hazardous weather conditions and other acts
of God or un-favourable operating conditions and losses. The Company manages
the risk by closing monitoring operations and maintaining adequate insurance
cover.
· Early-stage Business Risk: The Board manages this risk by
monitoring cash levels and reviewing cash flow forecasts on a regular basis.
· Market Risk (exchange rates, commodity, and equity): Market risk
is the risk of loss that may arise from changes in market factors such as
interest rates, foreign exchange rates, and commodity and equity prices. The
Company manages the risk by closing monitoring exchange rates, commodity, and
equity markets. The Company further engages consultants to undertake commodity
forecasts.
· Interest Rate Risk: The Company is exposed to interest rate risk
to the extent that its cash balances bear variable rates of interest. The
interest rate risks on cash and short-term investments and on the Company's,
obligations are not considered significant and is not mitigated at this time.
· Foreign Currency Risk: The Company is exposed to the financial
risk related to the fluctuation of foreign exchange rates against the
Company's functional currency, which is the United States dollar ("USD").
The Company has not hedged its exposure to currency fluctuations.
· Environmental Risks and Hazards: All phases of the Company's
operations are subject to environmental regulation in the areas in which it
operates. The Board manages this risk by working with environmental
consultants and by engaging with the relevant governmental departments and
other concerned stakeholders.
· Licencing Risk: The Company's exploration and development
activities are dependent upon the grant of appropriate licences, concessions,
leases, permits and regulatory consents which may be withdrawn or made subject
to limitations or performance criteria. Such licences and permits are as a
practical matter subject to the discretion of the applicable Government or
Government office. The Group must comply with known standards, existing laws
and regulations that may entail greater or lesser costs and delays depending
on the nature of the activity to be permitted. The interpretations, amendments
to existing laws and regulations, or more stringent enforcement of existing
laws and regulations could have a material adverse impact on the Group's
results of operations and financial condition. Whilst the Company continually
seeks to do everything within its control to ensure that the terms of each
licence are met and adhered to, third parties may seek to exploit any
technical breaches in licence terms for their own benefit. There is a risk
that negotiations with a Government in relation to the grant, renewal or
extension of a licence may not result in the grant, renewal or extension
taking effect prior to the expiry of the previous licence period, and there
can be no assurance of the terms of any extension, renewal, or grant.
· Political and Regulatory Risk: The Company operating activities
in Africa, notably in Zimbabwe, and Namibia, are subject to laws and
regulations governing expropriation of property, health and worker safety,
employment standards, waste disposal, protection of the environment, mine
development, land and water use, prospecting, mineral production, exports,
taxes, labour standards, occupational health standards, toxic wastes, the
protection of endangered and protected species and other matters. The Group is
dependent on the political and economic situation in these countries and may
be adversely impacted by political factors such as expropriation, war,
terrorism, insurrection, and changes to laws governing mineral exploration and
operations.
· Internal Control and Financial Risk Management: The Board has
overall responsibility for the Group's systems of internal control and for
reviewing their effectiveness. The Group maintains systems which are designed
to provide reasonable but not absolute assurance against material loss and to
manage rather than eliminate risk.
The Board has overall responsibility for maintaining and reviewing the Group's
system of internal control and ensuring that the controls are robust and
effective in enabling risks to be appropriately assessed and managed.
Refer to the principal risks and uncertainties as set out in the Strategic
Report for additional information on these risks.
On behalf of the Board, the AC conducts an annual review of the effectiveness
of the systems of internal control including financial, operational and
compliance controls and risk management systems.
Audit Committee and Auditors
The functions of the AC are clearly described as part of the Leadership
function in this note.
Whilst the Board sets the Company risk appetite, it reviews the operations and
effectiveness of the Company's risk management activities through the AC,
which undertake the day-to-day oversight of the risk management framework on
behalf of the Board. The Chairman of the AC regularly provides an update on
the work carried out by the AC to the board.
It is noted that the AC follow the recommendations of the Code whereby they
monitor and review the effectiveness of the internal audit activities.
However, at this time, the Board have determined that the appointment of
internal auditor is not required due to the size of the Company.
4. Remuneration
The Level and Components of Remuneration
Executive directors' remuneration should be designed to promote the long-term
success of the Company. Performance-related elements should be transparent,
stretching and rigorously applied. The Board delegates the responsibility for
setting the appropriate levels of remuneration for its directors to the
Remuneration Committee.
The levels of Remuneration to directors are disclosed to shareholders in
Premier Annual Report and Financial Statements. Both the Board and
Remuneration Committee seek to provide appropriate reward for the skill and
time commitment required so at to retain the right calibre of director at a
cost to the Company and which reflects the current market rates.
Procedure
The Board have a formal and transparent procedure for developing policy on the
executive remuneration and for fixing the remuneration packages of individual
directors. As strict policy, no director is involved in deciding their own
remuneration.
The Remuneration Committee consider and approves the remuneration and where
applicable, incentives and benefits, and makes recommendations to the Board.
The Committee will also govern employee share schemes. The Chairman of the
Committee will be consulted by the CEO in respect of the Company and
director's performance approvals, compensation and in respect of any
appointment/departures from roles.
The remuneration of non-executive directors shall be a matter for the
executive members of the Board.
The Company has adopted a share dealing code to ensure directors and certain
employees do not abuse, and do not place themselves under suspicion of abusing
inside information of which they are in possession and to comply with its
obligations under MAR which applies to the Company by virtue of its shares
being traded on AIM. Furthermore, the Company's share dealing code is
compliant with the AIM Rules for Companies published by the London Stock
Exchange (as amended from time to time).
Under the share dealing code, the Company must:
· Disclose all inside information to the public as soon as possible
by way of market announcement unless certain circumstances exist in which the
disclosure of the inside information may be delayed.
· Keep a list of each person who is in possession of inside
information relating to the Company.
· Procure that all persons discharging managerial responsibilities
and certain employees are given clearance by the Company before they are
allowed to trade in Company securities; and
· Procure that all persons discharging managerial responsibilities
and persons closely associated to them notify both the Company and the
Financial Conduct Authority of all trades in Company securities that they
make.
Additionally, under the share dealing code, no person discharging managerial
responsibilities is permitted to deal in Company securities (whether directly
or through an investment manager) during a closed period; being the period
either: from the end of the relevant financial year up to the release of the
preliminary announcement of the Company's annual results; from the end of the
relevant financial period up to the release of the Company's half-yearly
financial report or; 30 calendar days before the release of each of the
Company's first quarter report and third quarter report.
For details of the directors' remuneration refer to note 28.
5. Relations with Shareholders
Dialogue with shareholders
The Company recognises that maintaining strong communications with its
shareholders promotes transparency and will drive value in the medium to
long-term. Accordingly, the Company has an established programme to
communicate with shareholders. This done by providing regular updates on the
progress of the Company, detailing recent business and strategy developments,
in news releases which will be posted on the Company's website and through
certain social media channels.
The Disclosure Committee which comprises of George Roach and Wolfgang Hampel
and is chaired by Wolfgang Hampel is in place to assist the Board with the
dialogue between the Company and its shareholders. The Disclosure Committee
assumes general responsibility for approval and monitoring compliance with the
Company's disclosure controls and procedures. It has the responsibility, inter
alia, determining whether information is inside information, deciding whether
the inside information is to be announced as soon as possible and reviewing
the scope, content, and accuracy of disclosure. The Company has adopted a
share dealing code governing the share dealings of the Directors and
applicable employees during close periods and is in accordance with Rule 21 of
the AIM Rules.
The Chairman and CEO are contactable via email. Their email address can be
obtained at either the Company's registered office or by requesting them at
the below address. To continually improve transparency, the Board would be
delighted to receive feedback from shareholders. Communications should be
directed to info@premierafricanminerals.com
(mailto:info@premierafricanminerals.com) . The CEO has been appointed to
manage the relationship between the Company and its shareholders and will
review and report to the Board on any communications received.
Constructive Use of General Meetings
The Company holds AGM each year, whereby all of the directors aim to attend
the AGM and value the opportunity of welcoming individual shareholders and
other investors to communicate directly and address their questions.
In addition to the mandatory information required and procedures to calling a
general meeting, which can be found under the Company's constitutional
documents on the webpage, the Board ensure that a full, fair, and balanced
explanation of business of all general meetings is sent in advance to
shareholders.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and financial
statements and have prepared the Group financial statements in accordance with
UK adopted International Accounting Standards in order to give a true and fair
view of the state of affairs of the Group and of its profit or loss for that
period, in accordance with the rules of the London Stock Exchange for
companies trading securities on AIM.
In preparing these financial statements the directors are required to:
· select suitable accounting policies and then apply them
consistently.
· make judgements and accounting estimates that are reasonable and
prudent.
· state whether they have been prepared in accordance with UK
adopted International Accounting Standards, subject to any material departures
disclosed and explained in the financial statements; and
· prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company and the Group will
continue in business.
The directors are responsible for keeping records that are sufficient to show
and explain the Group and Company's transactions and will, at any time, enable
the financial position of the Group and Company to be determined with
reasonable accuracy. They are also responsible for safeguarding the assets of
the Company and the Group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the British Virgin Islands governing the preparation and
dissemination of the Company's financial statements and other information
included in the annual reports may differ from legislation in other
jurisdictions.
The directors consider this Annual report and accounts, taken as a whole, is
fair, balanced, understandable, and provides the information necessary for
shareholders to assess the Company's position, performance, business model and
strategy.
Statement of disclosure to auditor
The directors who were in office at the date of approval of these financial
statements have confirmed that, as far as they are aware, there is no relevant
audit information of which the auditor is unaware. Each of the directors has
confirmed that they have taken all the steps that they ought to have taken as
directors in order to make themselves aware of any relevant audit information
and to establish that it has been communicated to the auditor.
Viability statement and going concern
The Board has assessed the prospects of the Group over a period of 12 months
from the date of approval of these financial statements, involving a review of
the Group's forecast prepared for the 12 months ending 30 June 2023. and
taking account of the Board's intentions for future activities after that
date. As explained further in note 5, taking account of the Group's current
position and principal risks, over a 12 month period, the Board has a
reasonable expectation that the Group will be able to continue in operation
and meet its liabilities as they fall due over that period.
The Board considers these periods of assessment to be appropriate because they
contextualise the Company's financial position, business model and strategy.
George Roach
Acting Chairman and Chief Executive Officer
30 June 2022
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PREMIER AFRICAN MINERALS
LIMITED
Opinion
We have audited the consolidated financial statements of Premier African
Minerals Ltd (the 'Group') for the year ended 31 December 2021 which comprise
the consolidated income statement, the consolidated statement of comprehensive
income, the consolidated statement of financial position, the consolidated
statements of cash flows, the consolidated statements of changes in equity and
notes to the financial statements, including a summary of significant
accounting policies.
The financial reporting framework that has been applied in the preparation of
the financial statements is applicable law and UK adopted international
accounting standards.
In our opinion the financial statements,
• give a true and fair view of the state of the group's affairs as
at 31 December 2021 and of the group's performance for the year then ended;
• have been properly prepared in accordance with UK adopted
international accounting standards; and
• the group's financial statements have been properly prepared in
accordance with UK adopted international accounting standards;
• the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with UK adopted international accounting
standards and applicable law. Our responsibilities under those standards are
further described in the Auditor's responsibilities for the audit of the
financial statements section of our report. We are independent of the Group in
accordance with the ethical requirements that are relevant to our audit of the
financial statements in the UK, including the FRC's Ethical Standard as
applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation of the directors '
assessment of the entity's ability to continue to adopt the going concern
basis of accounting included:
• a review of management's budgets and cashflow
forecasts for the 12 months from proposed sign off date;
• a review of the inputs and assumptions utilised
in the budgets and cashflow forecasts taking into account our knowledge of the
group and its levels of operating cashflows;
• stress testing of the forecasted cashflows;
• a review of the cash balances held by the group
at year end date and at sign-off date.
Based on the work we have performed, we have not identified any material
uncertainties relating to events or conditions that, individually or
collectively, may cast significant doubt on the group's ability to continue as
a going concern for a period of at least twelve months from when the financial
statements are authorised for issue.
An overview of the scope of our audit
As part of designing our audit, we determined materiality and assessed the
risks of material misstatement in the financial statements. In particular, we
looked at where the directors made subjective judgments, for example in
respect of significant accounting estimates that involved making assumptions
and considering future events that are inherently uncertain. As in all of our
audits we also addressed the risk of management override of internal controls,
including evaluating whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to
be able to give an opinion on the financial statements as a whole, taking into
account the structure of the Group, the accounting processes and controls, and
the industry in which they operate.
The Group financial statements are a consolidation of 3 reporting units,
comprising the Group's operating businesses. The Group comprises the parent
undertaking, incorporated in the British Virgin Islands, its principal
operating subsidiaries, RHA Tungsten (Private) Limited and Zulu Lithium
(Private) Limited, and eleven non-trading or intermediate holding companies,
of which seven are registered in Mauritius, seven in Zimbabwe and three in
Australia. A full scope audit to Group materiality levels was performed on the
parent undertaking and the trading companies as well as their immediate
holding companies. This resulted in 100% coverage of consolidated expenditures
and 100% of the Group's gross assets.
We performed audits of the complete financial information of the Group
reporting units, which were individually financially significant and accounted
for 100% of the Group's absolute profit before tax (i.e. the sum of the
numerical values without regard to whether they were profits or losses for the
relevant reporting units). We also performed specified audit procedures over
certain account balances and transaction classes that we regarded as material
to the Group at the 3 reporting units.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. This is not a complete list of
all risks identified by our audit.
Key audit matters How our audit addressed the key audit matter
Valuation of the rehabilitation provision Valuation of the rehabilitation provision
The Group has recognised a rehabilitation provision, under IAS 37 - contingent We have understood and assessed the inputs in calculation of the liability.
liabilities and contingent assets, of $362,000 (2020: $153,000), in relation These were based on the original environmental impact assessment as carried
to the future costs to rehabilitate the current mines as per regulation. out in 2015. We have also verified that there were no applicable changes to
the regulations which would increase the liability and have reviewed
The directors are required to assess the provision at the end of each calculations for the unwinding of the provision.
reporting period and adjust to reflect their best estimates of the liability.
The directors consider the liability to be sufficient due to the value of the
RGTS (Zimbabwe currency) against the Dollar.
Fair value of investments Fair value of investments
The Group has recognised Investments of $8,342,000 (2020: $8,342,000) as at We have clarified that the MNH shares were valued at the basis of the latest
the reporting date. share transactions
Directors are required to assess the fair value of investments at each
reporting date under IFRS 9.
As neither Circum nor MNH are traded on an active market a level 3 valuation
technique was used. The shareholding was based on the most recent placing of
the shares in the respective companies, as well as management's best estimates
of the fair values.
Our application of materiality
The scope of our audit was influenced by our application of materiality. We
set certain quantitative thresholds for materiality. These, together with
qualitative considerations, helped us to determine the scope of our audit and
the nature, timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in evaluating the effect of
misstatements, both individually and in aggregate on the financial statements
as a whole.
Based on our professional judgment, we determined materiality for the
financial statements as a whole as follows:
Group financial statements
Overall materiality $90,000 (2020: $75,000)
How we determined it 1% of Gross assets
Rationale for benchmark applied We believe that the gross assets is a primary measure used by shareholders in
assessing the performance of the Group, as the group is at a pre-revenue stage
and is asset heavy.
We agreed with the Audit Committee that we would report to them misstatements
identified during our audit above $4,500 (2020: $3,750) as well as
misstatements below those amounts that, in our view, warranted reporting for
qualitative reasons.
Other information
The other information comprises the information included in the annual report
other than the financial statements and our auditor's report thereon. The
directors are responsible for the other information contained within the
annual report. Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise explicitly stated in our
report, we do not express any form of assurance conclusion thereon. Our
responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and its
environment obtained in the course of the audit, we have not identified
material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters that we are
required to report to you if, in our opinion:
• adequate accounting records have not been kept by the parent company,
or returns adequate for our audit have not been received from branches not
visited by us; or
• the financial statements are not in agreement with the accounting
records and returns; or
• certain disclosures of directors' remuneration specified by law are
not made; or
• we have not received all the information and explanations we require
for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement as set
out on page 23, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is necessary to
enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the group or the
parent company or to cease operations, or have no realistic alternative but to
do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
The extent to which the audit was considered capable of detecting
irregularities including fraud
Our approach to identifying and assessing the risks of material misstatement
in respect of irregularities, including fraud and non-compliance with laws and
regulations, was as follows:
• the senior statutory auditor ensured the engagement team
collectively had the appropriate competence, capabilities and skills to
identify or recognise non-compliance with applicable laws and regulations;
• we focused on specific laws and regulations which we considered
may have a direct material effect on the financial statements or the
operations of the Group.
• we assessed the extent of compliance with the laws and regulations
identified above through making enquiries of management and inspecting legal
correspondence; and
• identified laws and regulations were communicated within the audit
team regularly and the team remained alert to instances of non-compliance
throughout the audit.
We assessed the susceptibility of the Group's financial statements to material
misstatement, including obtaining an understanding of how fraud might occur,
by:
• making enquiries of management as to where they considered there
was susceptibility to fraud, their knowledge of actual, suspected and alleged
fraud;
• considering the internal controls in place to mitigate risks of
fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls,
we:
• performed analytical procedures to identify any unusual or
unexpected relationships;
• tested journal entries to identify unusual transactions;
• assessed whether judgements and assumptions made in determining
the accounting estimates set out in Note 2 were indicative of potential bias;
• investigated the rationale behind significant or unusual
transactions.
In response to the risk of irregularities and non-compliance with laws and
regulations, we designed procedures which included, but were not limited to:
• agreeing financial statement disclosures to underlying supporting
documentation;
• reading the minutes of meetings of those charged with governance;
• enquiring of management as to actual and potential litigation and
claims;
• Obtaining confirmation of compliance from the Company's legal
advisors.
There are inherent limitations in our audit procedures described above. The
more removed that laws and regulations are from financial transactions, the
less likely it is that we would become aware of non-compliance. Auditing
standards also limit the audit procedures required to identify non-compliance
with laws and regulations to enquiry of the directors and other management and
the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than
those that arise from error as they may involve deliberate concealment or
collusion.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor's report.
Use of this report
This report is made solely to the Company's members, as a body, in accordance
with our engagement letter. Our audit work has been undertaken so that we
might state to the Company's members those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other
than the company and the Company's members as a body, for our audit work, for
this report, or for the opinions we have formed.
Sanjay Parmar
Senior Statutory Auditor
For and on behalf of
Jeffreys Henry LLP, Statutory Auditor
Finsgate, 5-7 Cranwood Street,
London EC1V 9EE
30 June 2022
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
EXPRESSED IN US DOLLARS 2021 2020
Notes $ 000 $ 000
ASSETS
Non-current assets
Intangible assets 8 4 686 120
Investments 9 8 342 8 342
Property, plant and equipment 10 139 -
Loans Receivable 11 859 -
14 026 8 462
Current assets
Inventories 12 - 1
Trade and other receivables 13 386 7
Cash and cash equivalents 14 963 727
1 349 735
TOTAL ASSETS 15 375 9 197
LIABILITIES
Non-current liabilities
Financial lease liabilities 15 - -
Deferred tax 26 - -
Provisions - rehabilitation 16 362 153
362 153
Current liabilities
Trade and other payables 17 586 505
Financial lease liabilities 15 - -
Borrowings 18 180 -
766 505
TOTAL LIABILITIES 1 128 658
NET ASSETS 14 247 8 539
EQUITY
Share capital 19 56 113 52 504
Share based payment and warrant reserve 20 2 366 2 366
Revaluation reserve 711 711
Foreign currency translation reserve 7 (13 235) (13 181)
Accumulated loss (19 399) (22 135)
Total equity attributed to the owners of the parent company 26 556 20 265
Non-controlling interest 21 (12 309) (11 726)
TOTAL EQUITY 14 247 8 539
These financial statements were approved and authorised for issue by the Board
on 30 June 2022 and are signed on its behalf.
George Roach
Chief Executive Officer
The notes on pages 33 to 83 are an integral part of these consolidated
financial statements.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
AS AT 31 DECEMBER 2021
Continuing operations 2021 2020
EXPRESSED IN US DOLLARS Notes $ 000 $ 000
Revenue 22 - -
Cost of sales excluding depreciation and amortisation 23 - -
Gross profit / (loss) - -
Administrative expenses 24 (2 366) (1 274)
Operating profit / (loss) (2 366) (1 274)
Depreciation and amortisation 8, 10 (14) -
Other Income 22 133 81
Reversal of Impairment of Intangible assets - Zulu Lithium 10 4 563 -
Impairment of intangible assets - RHA Tungsten 10 - (3)
Finance charges 25 (18) (82)
4 664 (4)
Profit / (Loss) before income tax 2 298 (1 278)
Income tax expense 26 - -
Profit / (Loss) from continuing operations 2 298 (1 278)
Loss for the year 2 298 (1 278)
Other comprehensive income:
Items that are or may be reclassified subsequently to profit or loss:
Foreign exchange loss on translation 7 (199) (55)
Fair value movement on available-for-sale investment - -
(199) (55)
Total comprehensive income for the year 2 099 (1 333)
Loss attributable to:
Owners of the Company 2 736 (854)
Non-controlling interests (438) (424)
2 298 (1 278)
Total comprehensive income attributable to:
Owners of the Company 2 682 (886)
Non-controlling interests (583) (447)
Total comprehensive income for the year 2 099 (1 333)
Loss per share attributable to owners of the parent (expressed in US cents)
Basic loss per share 27 0.01 (0.01)
Diluted loss per share 27 0.01 (0.01)
The notes on pages 33 to 83 are an integral part of these consolidated
financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
Share capital Share option and warrant reserve Revaluation reserve Foreign currency translation reserve Accumulated loss Total attributable to owners of parent Non-controlling interest ("NCI") Total equity
EXPRESSED IN US DOLLARS $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
At 1 January 2020 48 042 2 366 711 (13 149) (21 281) 16 689 (11 279) 5 410
Loss for the period - - - - (854) (854) (424) (1 278)
Other comprehensive income for the period - - - (32) - (32) (23) (55)
Total comprehensive income for the period - - - (32) (854) (886) (447) (1 333)
Transactions with Owners
Issue of equity shares 4 558 - - - - 4 558 - 4 558
Share issue costs (96) - - - - (96) - (96)
Warrant options cancelled - - - - - - - -
Share based payments - - - - - - - -
At 31 December 2020 52 504 2 366 711 (13 181) (22 135) 20 265 (11 726) 8 539
Loss for the period - - - - 2 736 2 736 (438) 2 298
Other comprehensive income for the period - - - (54) - (54) (145) (199)
Total comprehensive income for the period - - - (54) 2 736 2 682 (583) 2 099
Transactions with Owners
Issue of equity shares 3 839 - - - - 3 839 - 3 839
Share issue costs (230) - - - - (230) - (230)
Warrant options cancelled - - - - - - - -
Share based payments - - - - - - - -
At 31 December 2021 56 113 2 366 711 (13 235) (19 399) 26 556 (12 309) 14 247
The notes on pages 33 to 83 are an integral part of these consolidated
financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2021
2021 2020
EXPRESSED IN US DOLLARS Notes $ 000 $ 000
Net cash outflow from operating activities 29 (2 540) (783)
Investing activities
Acquisition of property plant and equipment 10 (154) (4)
Loans advanced to investment 13 (859) -
Acquisition of subsidiaries, net of cash acquired 31 - (120)
Acquisition of investment 9 - (898)
Net cash used in investing activities (1 013) (1 022)
Financing activities
Proceeds from borrowings granted 18 180 200
Net proceeds from issue of share capital 19 3 609 2 343
Finance charges 15 - (1)
Repayment of finance lease 15 - (34)
Net cash from financing activities 3 789 2 508
Net decrease in cash and cash equivalents 236 703
Cash and cash equivalents at beginning of year 727 24
Net cash and cash equivalents at end of year 963 727
The notes on pages 33 to 83 are an integral part of these consolidated
financial statements.
1. Reporting entity
Premier African Minerals Limited ('Premier' or 'the Company'), together with
its subsidiaries (the 'Group'), was incorporated in the Territory of the
British Virgin Islands under the BVI Business Companies Act, 2004. The address
of the registered office is Craigmuir Chambers, PO Box 71, Road Town, Tortola,
British Virgin Islands.
The Group's operations and principal activities are the mining and development
of mineral reserves on the African continent.
Premier's shares were admitted to trading on the London Stock Exchange's AIM
market on 10 December 2012.
2. Basis of accounting
These consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (UK adopted International
Accounting Standards). They were authorised for issue by the Company's board
of directors on 30 June 2022.
Details of the Group's accounting policies are detailed below.
The preparation of financial statements in conformity with EU adopted IFRS
requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group's
accounting policies.
The accounting policies set out below are applied consistent across the Group
and to all periods presented in these consolidated financial statements.
Functional and presentation currency
The Group's presentation currency and the functional currency of the majority
of the group's entities is
US dollars. All amounts have been rounded to the nearest thousand, unless
otherwise indicated. The Zimbabwean subsidiaries' functional currency was
changed by the Zimbabwean government from USD to RTGS dollar during the 2019
financial year. Refer to note 7 for detailed information.
Use of judgements and estimates
In preparing these consolidated financial statements, management has made
judgements, estimates and assumptions that affect the application of the
Group's accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to estimates are recognised prospectively.
For details of the use of judgments and estimates refer to note 4 and detailed
notes on the Intangible assets and goodwill (note 8), Investments (note 9),
Property, plant and equipment (note 10), Inventories (note 12), Trade and
other receivables (note 13), Provision for rehabilitation (note 16) and Share
based payment and warrant reserve (note 20).
3. Significant accounting policies
3.1 Change in significant accounting policies
The group have implemented IFRS as adopted by UK. At the point of transition
from IFRS as adopted by EU the underlying requirements were identical. The
following standards, amendments and interpretations are new and effective for
the year ended 31 December 2021 and have been adopted. None of the IFRS
standards below had a material impact on the financial statements.
Reference Title Summary Application date of standard (Periods commencing on or after)
IFRS 3 Business combinations Amends the definition of a business and whether a transaction is accounted for
a business combination or an asset acquisition.
1 October 2020
IAS 1 and IAS 8 'Presentation of Financial Statements' and 'Accounting policies, changes in i) Use a consistent definition of materiality throughout IFRSs and the 1 October 2020
accounting estimates and errors' Conceptual Framework for Financial Reporting;
ii) Clarify the explanation of the definition of material; and
iii) Incorporate some of the guidance in IAS 1 about immaterial information.
IFRS 9, Interest rate benchmark reform - Phase 1. 1 October 2020
IAS 39 and
The phase 1 amendments provide certain reliefs in connection with interest
IFRS 7 rate benchmark. The reliefs relate to hedge accounting and have the effect
that IBOR reform should not generally cause hedge accounting to terminate.
The following new standards, amendments to standards and interpretations have
been issued, but are not effective for the financial year beginning 1 January
2022 and have not been early adopted:
Reference Title Summary Application date of standard (Periods commencing on or after)
IFRS 16 Leases COVID-19 related rent concessions Extension of the practical expedient 1 April 2021
IFRS 4, Interest rate benchmark reform - Phase 2. 1 January 2021
IAS 7 and
The Phase 2 amendments address issues that arise from the implementation of
IFRS 16 the reforms, including the replacement of one benchmark with an alternative
one. The Phase 2 amendments provide additional temporary reliefs from applying
specific IAS 39 and IFRS 9 hedge accounting requirements to hedging
relationships directly affected by IBOR reform.
IFRS 3 Business Combinations Updating a reference in IFRS 3 to the Conceptual Framework for Financial 1 January 2022
Reporting without changing the accounting requirements for business
combinations.
IAS 16 Property, Plant and Equipment Prohibits a company from deducting from the cost of property, plant and 1 January 2022
equipment amounts received from selling items produced while the company is
preparing the asset for its intended use. Instead, a company will recognise
such sales proceeds and related cost in profit or loss.
IAS 37 Provisions, contingent liabilities and contingent assets Specifies which costs a company includes when assessing whether a contract 1 January 2022
will be loss-making.
IAS 1 Presentation of Financial Statements Clarifies that liabilities are classified as either current or noncurrent, 1 January 2023
depending on the rights that exist at the end of the reporting period.
Classification is unaffected by the expectations of the entity or events after
the reporting date (for example, the receipt of a waiver or a breach of
covenant). The amendment also clarifies what IAS 1 means when it refers to the
'settlement' of a liability.
IAS 1 and IAS 8 'Presentation of Financial Statements' and 'Accounting policies, changes in Amendments to improve accounting policy disclosures and to help users of the 1 January 2023
accounting estimates and errors' financial statements to distinguish between changes in accounting estimates
and changes in accounting policies.
IAS 12 Deferred Taxation These amendments require companies to recognise deferred tax on transactions 1 January 2023
that, on initial recognition give rise to equal amounts of taxable and
deductible temporary differences.
IFRS17 Insurance contracts This standard replaces IFRS 4, which currently permits a wide variety of 1 January 2023
practices in accounting for insurance contracts. IFRS 17 will fundamentally
change the accounting by all entities that issue insurance contracts and
investment contracts with discretionary participation features.
The Directors anticipate that the adoption of these standards and the
interpretations in future periods will not have a material impact on the
financial statements of the Group.
3.2 Basis of consolidation
Subsidiaries are all entities over which the Group has control. The Group
controls an entity when it is exposed to, or has the rights to, variable
returns from its involvement with the entity and has the ability to affect
those returns through its power over the entity. The existence and effect of
potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Group controls another entity. The Group
also assesses existence of control where it does not have more than 50% of the
voting power but is able to govern the financial and operating policies by
virtue of de-facto control. This is evidenced with RHA Tungsten (Private)
Limited which the Group owns 49% of but is consolidated into the Group (note
4.7).
Subsidiaries are consolidated, using the acquisition method, from the date
that control is gained and non-controlling interests are apportioned on a
proportional basis.
When necessary, amounts reported by subsidiaries have been adjusted to conform
to the Group's accounting policies.
3.3 Business combinations and goodwill
The Group applies the acquisition method to account for business combinations.
The consideration transferred for the acquisition of a subsidiary is the fair
values of the assets transferred, the liabilities incurred to the former
owners of the acquiree, and the equity interests issued by the Group. The
consideration transferred includes the fair value of any asset or liability
resulting from a contingent consideration arrangement. Identifiable assets
acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the acquisition
date.
3.4 Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an
entity when it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns
through its power over the entity. The financial statements of subsidiaries
are included in the consolidated financial statements from the date on which
control commences until the date on which control ceases.
3.5 Non-controlling interests ("NCI")
Non-controlling interests are measured initially at their proportionate share
of the acquiree's identifiable net assets at the date of acquisition.
Changes in the Group's interest in a subsidiary that do not result in a loss
of control are accounted for as equity transactions.
3.6 Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses
arising from intra-group transactions, are eliminated. Unrealised gains
arising from transactions with equity accounted investees are eliminated
against the investment to the extent of the Group's interest in the investee.
Unrealised losses are eliminated in the same way as unrealised gains, but only
to the extent that there is no evidence of impairment.
3.7 Foreign currency
Transactions in foreign currencies are translated into the respective
functional currencies of Group companies at the exchange rates at the dates of
the transactions.
Monetary assets and liabilities denominated in foreign currencies are
translated into the functional currency at the exchange rate at the reporting
date. Non-monetary assets and liabilities that are measured at fair value in a
foreign currency are translated into the functional currency at the exchange
rate when the fair value was determined. Non-monetary items that are measured
based on historical cost in a foreign currency are translated at the exchange
rate at the date of the transaction. Foreign currency differences are
generally recognised in profit or loss.
The assets and liabilities of foreign operations, including goodwill and fair
value adjustments arising on acquisition, are translated into dollars at the
exchange rates at the reporting date. The income and expenses of foreign
operations are translated into dollars at the exchange rates at the dates of
the transactions.
Foreign currency differences are recognised in Other Comprehensive Income
("OCI") and accumulated in the translation reserve, except to the extent that
the translation difference is allocated to NCI.
Where the functional currency of a company is in a hyperinflationary economy
IAS 29 Financial Reporting in Hyperinflationary Economies is applied. Under
this standard the results are restated to reflect the current cost of the
various elements of the financial statements. For the Statement of
comprehensive income the cost of sales and depreciation are recorded at
current costs at the time of consumption; sales and other expenses are
recorded at their money amounts when they occurred. Therefore all amounts need
to be restated into the measuring unit current at the end of the reporting
period by applying a general price index.
Monetary items stated in the Statement of financial position that are stated
at current cost are not restated because they are already expressed in terms
of the measuring unit current at the end of the reporting period. All
non-monetary items in the statement of financial position are restated by
applying an index at the time of their acquisition to the reporting date. Any
resulting gain or loss on the net monetary position is included in profit or
loss reserve.
In accordance with IAS29, corresponding figures for the previous reporting
period, whether they were based on a historical cost approach or a current
cost approach, are restated by applying a general price index so that the
comparative financial statements are presented in terms of the measuring unit
current at the end of the reporting period. Information that is disclosed in
respect of earlier periods is also expressed in terms of the measuring unit
current at the end of the reporting period.
When a foreign operation is disposed of in its entirety or partially such that
control, significant influence or joint control is lost, the cumulative amount
in the translation reserve related to that foreign operation is reclassified
to profit or loss as part of the gain or loss on disposal. If the Group
disposes of part of its interest in a subsidiary but retains control, then the
relevant proportion of the cumulative amount is reattributed to NCI. When the
Group disposes of only part of an associate or joint venture while retaining
significant influence or joint control, the relevant proportion of the
cumulative amount is reclassified to profit or loss.
3.8 Discontinued operation
A discontinued operation is a component of the Group's business, the
operations and cash flows of which can be clearly distinguished from the rest
of the Group and which:
· represents a separate major line of business or geographic area of
operations;
· is part of a single co-ordinated plan to dispose of a separate major
line of business or geographic area of operations; or
· is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs at the earlier of disposal
or when the operation meets the criteria to be classified as held-for-sale.
When an operation is classified as a discontinued operation, the comparative
statement of profit or loss and OCI is re-presented as if the operation had
been discontinued from the start of the comparative year.
3.9 Revenue
Performance obligations and service recognition policies
Revenue is measured based on the consideration specified in a contract with a
customer in line with IFRS 15. The Group recognises revenue when it transfers
control over of goods or services to a customer.
The following table provides information about the nature and timing of the
satisfaction of performance obligations in contracts with customers, including
significant payment terms, and the related revenue recognition policies.
Type of product/ service Nature and timing of satisfaction of performance obligations, including Revenue recognition under IFRS 15
significant payment terms
Revenue
Wolframite sales Customers obtain control of the wolframite ore when the ore has been delivered Revenue is recognised when the goods are delivered and have been accepted by
to and have been accepted at their premises or the agreed point of delivery. the customers at their premises or the agreed point of delivery.
Invoices are generated at that point in time based on the agreed upon weight
of the ore. Invoices are generally payable within 30 days. No discounts are
provided for.
The sale of the ore is not subject to a return policy.
Scrap sales Customers obtain control of the scrap when the scrap has been delivered to and Revenue is recognised when the goods are delivered and have been accepted by
have been accepted at their premises or the agreed point of delivery. Invoices the customers at their premises or the agreed point of delivery.
are generated at that point in time based upon the agreed upon weight of the
scrap. Invoices are generally payable within 30 days. No discounts are
provided for.
The sale of the scrap is not subject to a return policy.
Reserve Bank of Zimbabwe Export Incentive The Export Incentive is provided on an individual basis and has to be applied The Group gains control over the export incentive when it is received in the
for. It is based on the export sales of the company. As such the revenue from Group's bank accounts.
the RBZ is not guaranteed.
Other Income
Government Grants The Group has no control over the timing of the grants nor any payment terms. The Group gains control over the Government grant when it is received in the
Group's bank accounts.
Prescription of debts Management periodically reviews all outstanding payables and identifies any Debts are considered prescribed if the creditor has not claimed payment for a
potential debts that may have prescribed. period in excess of the relevant prescription period.
3.10 Employee benefits
Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided.
A liability is recognised for the amount expected to be paid if the Group has
a present legal or constructive obligation to pay this amount as a result of
past service provided by the employee and the obligation can be estimated
reliably.
Share-based payment arrangements
The Group operates an equity-settled share option plan and issues warrants
from time to time either with direct subscriptions in equity or as finance
related packages. The fair value of the service received in exchange for the
grant of options or issue of warrants is recognised as an expense or
recognised as a deduction from equity or an addition to intangible assets
depending on the nature of the services received.
Share-based payments are measured at fair value at the date of grant. The
fair value determined at the grant date of equity-settled share-based payments
is expensed on a straight-line basis over the vesting period, based on the
Group's estimate of shares that will eventually vest.
Fair value is measured by use of the Black Scholes model. The expected life
used in the model has been adjusted, based on management's best estimate, for
the effects of non-transferability, exercise restrictions, and behavioural
considerations.
Any adjustments are recognised through the profit and loss. The fair value is
reassessed annually.
3.11 Finance income and finance costs
The Group's finance income and finance costs include:
· interest income;
· Interest expense;
· dividend income;
Interest income and expense is recognised using the effective interest method.
Dividend income is recognised in profit or loss on the date on which the
Group's right to receive payment is established.
The "effective interest rate" is the rate that exactly discounts estimated
future cash payments or receipts through the expected life of the financial
instrument to:
· the gross carrying amount of the financial asset; or
· the amortised cost of the financial liability.
In calculating interest income and expense, the effective interest rate is
applied to the gross carrying amount of the asset (when the asset is not
credit-impaired) or to the amortised cost of the liability. However, for
financial assets that have become credit-impaired subsequent to initial
recognition, interest income is calculated by applying the effective interest
rate to the amortised cost of the financial asset, if the asset is no-longer
credit-impaired, then the calculation of interest income reverts to the gross
basis.
3.12 Income tax
Income tax expense comprises current and deferred tax. It is recognised in
profit or loss except to the extent that it relates to a business combination,
or items recognised directly in equity or in OCI.
3.12.1 Current tax
Current tax comprises the expected tax payable or receivable on the taxable
income or loss for the year and any adjustment to the tax payable or
receivable in respect of previous years. The amount of current tax payable or
receivable is the best estimate of the tax amount expected to be paid or
received that reflects uncertainty related to income taxes, if any. It is
measured using tax rates enacted or substantively enacted at the reporting
date. Current tax also includes any tax arising from dividends.
Current tax assets and liabilities are offset only if certain criteria are
met.
3.12.2 Deferred tax
Deferred tax is recognised in respect of temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes
and the amounts used for taxation purposes.
Deferred tax is not recognised for:
· temporary differences on the initial recognition of assets or
liabilities in a transaction that is not a business combination and that
affects neither accounting nor taxable profit or loss;
· temporary differences related to investments in subsidiaries,
associates and joint arrangements to the extent that the Group is able to
control the timing of the reversal of the temporary differences and it is
probable that they will not reverse in the foreseeable future; and -- taxable
temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits
and deductible temporary differences to the extent that it is probable that
future taxable profits will be available against which they can be used.
Future taxable profits are determined based on the reversal of relevant
taxable temporary differences. If the amount of taxable temporary differences
is insufficient to recognise a deferred tax asset in full, then future taxable
profits, adjusted for reversals of existing temporary differences, are
considered, based on the business plans for individual subsidiaries in the
Group. Deferred tax assets are reviewed at each reporting date and are reduced
to the extent that it is no longer probable that the related tax benefit will
be realised; such reductions are reversed when the probability of future
taxable profits improves.
Unrecognised deferred tax assets are reassessed at each reporting date and
recognised to the extent that it has become probable that future taxable
profits will be available against which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to
temporary differences when they reverse, using tax rates enacted or
substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would
follow from the manner in which the Group expects, at the reporting date, to
recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset only if certain criteria are
met.
3.13 Intangible assets and goodwill
All costs of Exploration and Evaluation ("E&E") are initially capitalised
as intangible assets, such as payments to acquire the legal right to explore,
costs of technical services and studies, seismic acquisition, exploratory
drilling and testing. The costs include directly attributable overheads
together with the cost of other materials consumed during the exploration and
evaluation phases.
Costs incurred prior to having obtained the legal rights to explore an area
are expensed directly to profit or loss as they are incurred.
E&E assets are not amortised.
Intangible assets related to each exploration licence or pool of licences are
carried forward, until the existence (or otherwise) of commercial reserves has
been determined. Once the technical feasibility and commercial viability of
extracting a mineral resource is demonstrable, the related E&E assets are
assessed for impairment on an individual licence or cost pool basis, as
appropriate, as set out below and any impairment loss is recognised in profit
or loss.
The Group considers each licence, or where appropriate, a pool of licences,
separately, for the purposes of determining whether impairment of E&E
assets has occurred.
Intangible assets are assessed for impairment when facts and circumstances
suggest that the carrying amount may exceed its recoverable amount. Such
indicators include, but are not limited to, those situations outlined in
paragraph 20 of IFRS 6 Exploration for and Evaluation of Mineral Resources and
include the point at which a determination is made as to whether or not
commercial reserves exist.
When impairment indicators exist, the aggregate carrying value is compared
against the expected recoverable amount, generally by reference to the present
value of the future net cash flows expected to be derived from production of
commercial reserves.
When a licence or pool of licences is abandoned or there is no planned future
work, the costs associated with the respective licences are written off in
full and recognised in profit or loss.
Any impairment loss is recognised in profit or loss and separately disclosed.
3.14 Impairment
3.14.1 Non-derivative financial assets
Credit-impaired financial assets
At each reporting date, the Group assesses whether financial assets carried at
amortised cost and debt securities at FVOCI are credit-impaired. A financial
asset is "credit-impaired" when one or more events that have a detrimental
impact on the estimated future cash flows of the financial assets have
occurred.
Evidence that a financial asset is credit-impaired includes the following
observable data:
· significant financial difficulty of the borrower or issuer;
· a breach of contract such as a default or being more than 90 days
past due;
· the restructuring of a loan or advance by the Group on terms that
the Group would not consider otherwise;
· it is probable that the borrower will enter bankruptcy or other
financial reorganisation; or
· the disappearance of an active market for a security because of
financial difficulties.
A 12 months approach is followed in determining the Expected Credit Loss
("ECL").
Presentation of allowance for ECL in the statement of financial position
Loss allowances for financial assets measured at amortised cost are deducted
from the gross carrying amount of the assets.
For debt securities at FVOCI, the loss allowance is charged to profit or loss
and is recognised in OCI.
Write-off
The gross carrying amount of a financial asset is written off when the Group
has no reasonable expectations of recovering a financial asset in its entirety
or a portion thereof. For corporate customers, the Group individually makes an
assessment with respect to the timing and amount of write-off based on whether
there is a reasonable expectation of recovery from the amount written off.
However, financial assets that are written off could still be subject to
enforcement activities in order to comply with the Group's procedures of
recovery of the amounts due.
3.14.2 Financial assets measured at amortised cost
The Group considers evidence of impairment for these assets at both an
individual asset and a collective level. All individually significant assets
are individually assessed for impairment. Those found not to be impaired are
then collectively assessed for any impairment that has been incurred but not
yet individually identified. Assets that are not individually significant are
collectively assessed for impairment. Collective assessment is carried out by
grouping together assets with similar risk characteristics.
In assessing collective impairment, the Group uses historical information on
the timing of recoveries and the amount of loss incurred, and makes an
adjustment if current economic and credit conditions are such that the actual
losses are likely to be greater or lesser than suggested by historical trends.
An impairment loss is calculated as the difference between an asset's carrying
amount and the present value of the estimated future cash flows discounted at
the asset's original effective interest rate. Losses are recognised in profit
or loss and reflected in an allowance account. When the Group considers that
there are no realistic prospects of recovery of the asset, the relevant
amounts are written off. If the amount of impairment loss subsequently
decreases and the decrease can be related objectively to an event occurring
after the impairment was recognised, then the previously recognised impairment
loss is reversed through profit or loss.
3.14.3 Available for sale financial asset
Impairment losses on available-for-sale financial assets are recognised, only
when fair value is less than carrying value and this is significant over a
prolonged period, by reclassifying the losses accumulated in the fair value
reserve to profit or loss. The amount reclassified is the difference between
the acquisition cost (net of any principal repayment and amortisation) and the
current fair value, less any impairment loss previously recognised in profit
or loss.
3.14.4 Non-financial assets
At each reporting date, the Group reviews the carrying amounts of its
non-financial assets (other than inventories) to determine whether there is
any indication of impairment. If any such indication exists, then the asset's
recoverable amount is estimated. Goodwill is tested annually for impairment.
For impairment testing, assets are grouped together into the smallest group of
assets that generates cash inflows from continuing use that are largely
independent of the cash inflows of other assets or CGUs. Goodwill arising from
a business combination is allocated to CGUs or groups of CGUs that are
expected to benefit from the synergies of the combination.
The recoverable amount of an asset or CGU is the greater of its value in use
and its fair value less cost of disposal. Value in use is based on the
estimated future cash flows, discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset or CGU.
An impairment loss is recognised if the carrying amount of an asset or CGU
exceeds its recoverable amount.
Impairment losses are recognised in profit or loss. They are allocated first
to reduce the carrying amount of any goodwill allocated to the CGU, and then
to reduce the carrying amounts of the other assets in the CGU on a pro rata
basis.
An impairment loss in respect of goodwill is not reversed. For other assets,
an impairment loss is reversed only to the extent that the asset's carrying
amount does not exceed the carrying amount that would have been determined,
net of depreciation or amortisation, if no impairment loss had been
recognised.
3.15 Cash and cash equivalents
The Cash and cash equivalents comprises of cash at bank, cash on hand and
other highly liquid investments with short term maturities. Cash and cash
equivalents are measured at amortised cost. For the purposes of the Statement
of Cash Flows, cash and cash equivalents consist of cash and cash equivalents
as defined above, net of outstanding bank overdrafts.
3.16 Inventory
Inventory is measured at the lower of cost and net realisable value. The cost
of inventories is based on the first-in, first-out principle. The cost of
inventories includes the cost of consumables and cost of production. Net
realisable value is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and selling expenses.
Inventory consists of mining consumables.
3.17 Property, plant and equipment
Recognition and measurement
Items of property, plant and equipment are measured at cost, which includes
capitalised borrowing costs, less accumulated depreciation and any accumulated
impairment losses.
If significant parts of an item of property, plant and equipment have
different useful lives, then they are accounted for as separate items (major
components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is
recognised in profit or loss.
Subsequent expenditure
Subsequent expenditure is capitalised only if it is probable that the future
economic benefits associated with the expenditure will flow to the Group.
Depreciation
Depreciation is calculated to write off the cost of items of property, plant
and equipment less their estimated residual values using the straight-line
method over their estimated useful lives, and is generally recognised in
profit or loss. Leased assets are depreciated over the shorter of the lease
term and their useful lives unless it is reasonably certain that the Group
will obtain ownership by the end of the lease term. Land is not depreciated.
The estimated useful lives of property, plant and equipment for current and
comparative periods are as follows:
· Land - indefinite useful life
· Buildings - 10 years
· Plant & equipment - 4/6 years
· Mine development - depreciated over the life of the mine,
currently assessed at 10 years
Depreciation methods, useful lives and residual values are reviewed at each
reporting date and adjusted if appropriate.
3.18 Financial instruments
The Group classifies non-derivative financial assets into the following
categories: loans and receivables and FVTPL and FVTOCI financial assets.
The Group classifies non-derivative financial liabilities into the following
category: other financial liabilities.
3.18.1 Non-derivative financial assets and financial liabilities -
Recognition and derecognition
The Group initially recognises loans and receivables on the date when they are
originated. All other financial assets and financial liabilities are initially
recognised on the trade date when the entity becomes a party to the
contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the
cash flows from the asset expire, or it transfers the rights to receive the
contractual cash flows in a transaction in which substantially all of the
risks and rewards of ownership of the financial asset are transferred, or it
neither transfers nor retains substantially all of the risks and rewards of
ownership and does not retain control over the transferred asset. Any interest
in such derecognised financial assets that is created or retained by the Group
is recognised as a separate asset or liability.
The Group derecognises a financial liability when its contractual obligations
are discharged or cancelled or expire. Gains or losses on derecognition of
financial liabilities are recognised in profit or loss as a finance charge.
Financial assets and financial liabilities are offset, and the net amount
presented in the statement of financial position when, and only when, the
Group currently has a legally enforceable right to offset the amounts and
intends either to settle them on a net basis or to realise the asset and
settle the liability simultaneously.
3.18.2 Loans and receivables- Measurement
These assets are initially measured at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, they are
measured at amortised cost using the effective interest method.
3.18.3 Assets at FVOCI - Measurement
These assets are initially measured at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, they are
measured at fair value and changes therein, other than impairment losses, are
recognised in OCI and accumulated in the revaluation reserve.
When these assets are derecognised, the gain or loss accumulated in equity is
reclassified to profit or loss.
3.18.4 Non-derivative financial liabilities - Measurement
Other non-derivative financial liabilities are initially measured at fair
value less any directly attributable transaction costs. Subsequent to initial
recognition, these liabilities are measured at amortised cost using the
effective interest method.
3.18.5 Convertible loan notes and derivative financial instruments
The presentation and measurement of loan notes for accounting purposes is
governed by IAS 32 and IAS 39. These standards require the loan notes to be
separated into two components:
· A derivative liability, and
· A debt host liability.
This is because the loan notes are convertible into an unknown number of
shares, therefore failing the 'fixed-for-fixed' criterion under IAS 32. This
requires the 'underlying option component' of the loan note to be valued first
(as an embedded derivative), with the residual of the face value being
allocated to the debt host liability (refer financial liabilities policy
above).
Compound financial instruments issued by the Group comprise convertible notes
denominated in dollars that can be converted to ordinary shares at the option
of the holder, when the number of shares to be issued is fixed and does not
vary with changes in fair value.
The liability component of compound financial instruments is initially
recognised at the fair value of a similar liability that does not have an
equity conversion option. The equity component is initially recognised at the
difference between the fair value of the compound financial instrument as a
whole and the fair value of the liability component. Any directly attributable
transaction costs are allocated to the liability and equity components in
proportion to their initial carrying amounts.
Subsequent to initial recognition, the liability component of a compound
financial instrument is measured at amortised cost using the effective
interest method. The equity component of a compound financial instrument is
not remeasured.
Interest related to the financial liability is recognised in profit or loss.
On conversion at maturity, the financial liability is reclassified to equity
and no gain or loss is recognised.
3.19 Provisions - Rehabilitation
Provisions are recognised when the Group has a present obligation (legal or
constructive) as a result of a past event, it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the
obligation.
An obligation to incur environmental restoration, rehabilitation and
decommissioning costs arises when disturbance is caused by the development or
on-going production of a mining property. Such costs arising from the
decommissioning of plant and other site preparation work, discounted to their
net present value, are provided for and capitalised at the start of each
project, as soon as the obligation to incur such costs arises. These costs are
recognised in profit or loss over the life of the operation, through the
depreciation of the asset and the unwinding of the discount on the provision.
Costs for restoration of subsequent site damage which is created on an ongoing
basis during production are provided for at their net present values and
recognised in profit or loss as extraction progresses.
Changes in the measurement of a liability relating to the decommissioning of
plant or other site preparation work (that result from changes in the
estimated timing or amount of the cash flow, or a change in the discount rate)
are added to or deducted from the cost of the related asset in the current
period. If a decrease in the liability exceeds the carrying amount of the
asset, the excess is recognised immediately in profit or loss. If the asset
value is increased and there is an indication that the revised carrying value
is not recoverable, an impairment test is performed in accordance with the
accounting policy above.
Provisions are determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time value of
money and the risks specific to the liability. The unwinding of the discount
is recognised as finance cost in profit or loss.
3.20 Equity
Equity comprises the following:
· Share capital - ordinary shares are classified as equity. Incremental
costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
· Share-options and warrant reserve - represents equity-settled
share-based payments.
· Accumulated loss represents retained profits less retained losses.
· Revaluation reserve represents the difference between the nominal
value of shares issued by the Company to the shareholders of ZimDiv Holdings
Limited ("Zimdiv") and the nominal value of the ZimDiv shares taken in
exchange.
· Non-controlling interests represents the share of retained profits
less retained losses of the non-controlling interests.
· Foreign currency translation reserve represents the other
comprehensive income gains or losses arising on the conversion of the
functional currencies of the subsidiaries to the holding company's functional
currency of USD.
3.21 Leases
Determining whether an arrangement contains a lease.
At inception of an arrangement, the Group determines whether the arrangement
is or contains a lease.
At inception or on reassessment of an arrangement that contains a lease, the
Group separates payments and other consideration required by the arrangement
into those for the lease and those for other elements on the basis of their
relative fair values. If the Group concludes for a finance lease that it is
impracticable to separate the payments reliably, then an asset and a liability
are recognised at an amount equal to the fair value of the underlying asset;
subsequently, the liability is reduced as payments are made and an imputed
finance cost on the liability is recognised using the Group's incremental
borrowing rate.
Assets held under leases are recognised as assets of the Group at the fair
value at the inception of the lease or, if lower, at the present value of the
minimum lease payments. Lease payments are apportioned between interest
expense and capital redemption of the liability. Interest is recognised
immediately in the statement of comprehensive income unless attributable to
qualifying assets, in which case they are capitalised to the cost of those
assets.
Exemptions are applied for short life leases and low value assets made under
operating leases charged to the statement of comprehensive income on a
straight line basis over the period of the lease.
Payments made under non-capitalised leases are recognised in profit or loss on
a straight-line basis over the term of the lease. Lease incentives received
are recognised as an integral part of the total lease expense, over the term
of the lease.
Minimum lease payments made are apportioned between the finance expense and
the reduction of the outstanding liability. The finance expense is allocated
to each period during the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability.
3.22 Operating segments
Segmental information is provided for the Group on the basis of information
reported internally to the chief operating decision-maker for decision-making
purposes. The Group considers that the role of chief operating decision-maker
is performed by the Group's board of directors.
4. Significant accounting judgements, estimates and assumptions
In preparing these consolidated financial statements, management has made
judgements, estimates and assumptions that affect the application of the
Group's accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to estimates are recognised prospectively.
4.1. Judgements
Information about judgements made in applying accounting policies that have
the most significant effects on the amounts recognised in the consolidated
financial statements is included in the following notes:
- Note 4.7 - consolidation: whether the Group has de facto control
over an investee; and
- Note 15 - leases: whether an arrangement contains a lease.
4.2. Assumptions and estimation uncertainties
Information about assumptions and estimation uncertainties that have a
significant risk of resulting in a material adjustment to the carrying amounts
of assets and liabilities within the year ended 31 December 2021 is included
in the following notes:
· Note 26 - recognition of deferred tax assets: availability of future
taxable profit against which tax losses carried forward can be used;
· Note 4.4 - Recoverability of exploration and evaluation assets: key
assumptions underlying recoverable amounts;
· Note 4.5 - Recoverability of RHA Cash-Generating Unit "CGU": key
assumptions underlying recoverable amounts;
· Note 16 - recognition and measurement of provisions and
contingencies: key assumptions about the likelihood and magnitude of an
outflow of resources; and
· Note 20 - share based payments assumptions regarding the various
inputs into the Black Scholes model used to determine the option value.
·
4.3. Measurement of fair values
A number of the Group's accounting policies and disclosures require the
measurement of fair values, for both financial and non-financial assets and
liabilities.
When measuring the fair value of an asset or a liability, the Group uses
observable market data as far as possible. Fair values are categorised into
different levels in a fair value hierarchy based on the inputs used in the
valuation techniques as follows.
· Level 1: quoted prices (unadjusted) in active markets for identical
assets or liabilities.
· Level 2: inputs other than quoted prices included in Level 1 that are
observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
· Level 3: inputs for the asset or liability that are not based on
observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability fall
into different levels of the fair value hierarchy, then the fair value
measurement is categorised in its entirety in the same level of the fair value
hierarchy as the lowest level input that is significant to the entire
measurement.
The Group recognises transfers between levels of the fair value hierarchy at
the end of the reporting period during which the change occurred.
Further information about the assumptions made in measuring fair values is
included in the following notes:
· Note 20 - share-based payment arrangements;
· Note 30 - financial instruments.
4.4 Recoverability of exploration and evaluation assets
Determining whether an exploration and evaluation asset is impaired requires
an assessment of whether there are any indicators of impairment, including by
reference to specific impairment indicators prescribed in IFRS 6 Exploration
for and Evaluation of Mineral Resources. If there is any indication of
potential impairment, an impairment test is required based on value in use of
the asset or fair value less cost to sell.
The carrying amount of exploration and evaluation assets at 31 December 2021
amounted to $4.566 million (2020: $nil). Refer to note 8 for the assumptions
used.
4.5 Recoverability of RHA Cash-Generating Unit "CGU"
Determining whether a CGU is impaired requires an assessment of whether there
are any indicators of impairment, including by reference to specific
impairment indicators prescribed in IAS36 Impairment of Assets. If there is
any indication of potential impairment, an impairment test is required based
on the greater of fair value less cost of disposal, and, value in use of the
asset. The value in use calculation requires the entity to estimate the future
cash flows expected to arise from the cash-generating unit and a suitable
discount rate in order to calculate the present value.
During 2017 the operating losses at RHA were higher than predicted due to
operations in the open pit and underground failing to deliver both the ore
volumes and the anticipated grade. The operating losses are an indicator of
potential impairment. In December 2017, due to the lower ore delivery,
anticipated grade and operating losses, the Board of Directors decided to
place the RHA Tungsten mine under care and maintenance.
As a result, management completed an impairment review.
The impairment review concluded that four months further capex will be
required in order to open the existing underground mining of 6 000 tons per
month run of mine ore. Concurrently additional plant upgrades and a connection
to the national grid would result in a 40 000 ton per month run of mine ore
operation. A further option to construct a new decline vehicle access was not
considered during this review.
Key assumptions used in calculating the initial impairment included:
· 7 265 mtu concentrate production per month; 10 year mine plan; APT
price of $275 per metric ton unit ('mtu');
· 20% discount rate; and a zero growth rate in operating cash flow
after the plant is fully operational, forecast to be for the full year 2019.
Other key factors include attainment of forecast grade as set out in our
resource statement and plant operating parameters being achieved.
· The XRT sorter installation is a significant element in increasing
confidence in RHA in that 70% of the anticipated run of mine feed target of 40
000 ton per month is passed through the sorter, which is able to recover
approximately 90% of the mineralisation in a mass pull of some 5%.
· The model assumes annual revenues of $13.1m from 2020. Revenue
generation is dependent on a number of inter-linked assumptions and a
combination of negative changes in those assumptions would result in further
impairment charges.
As the mine is not operating, these assumptions were not revisited and the
mine remains fully impaired.
Sensitivity analysis was conducted on the volume, grade, concentrate
production per month and APT price assumptions in the model.
The management of RHA continue to engage with NIEEF about the future of RHA.
4.6 Estimation of useful life for mine assets
Mine assets are depreciated /amortised on a straight-line basis over the life
of the mine concerned. Judgement is applied in assessing the mine's useful
life and in the case of RHA, the Group's only operating concern, is based on
the initial Preliminary Economic Assessment ('PEA') first published in August
2013 that initially modelled an 8 year life of mine. The life of mine
reassessed annually based on levels of production.
4.7 Basis of consolidation
RHA
During 2013, Premier concluded a shareholders' agreement with NIEEF whereby
NIEEF acquired 51% of the shares of RHA. The principal terms of the agreement
are as follows:
· ZimDiv Holdings Limited ('ZimDiv'), a wholly owned subsidiary, is
appointed as the Manager of the project for an initial 5 year term.
· On 7 May 2019 ZimDiv were reappointed as the manager for another 5
year term.
· ZimDiv has marketing rights to the product.
· Each shareholder can appoint up to two directors each, with a 5(th)
director who is rotated between each shareholder. The 5(th) director will not
have a vote.
· Although the local Zimbabwean company is responsible for financing
and repayment of such. Premier has secured the funding to advance RHA to
production.
· There has been no operational change since the agreements were signed
and Premier continues to fund RHA until it becomes cash generative.
At the financial year-end, two directors of RHA were from the Premier Group
and three directors from NIEEF. There is no majority vote at board level and
Premier still retains operational and management control through its
shareholders' agreement. Following the assessment, the Directors concluded
that Premier, through its wholly owned subsidiary ZimDiv, retained control and
should continue to consolidate 100% of RHA and recognise non-controlling
interests of 51% in the consolidated financial statements.
4.8 Valuations
· Investments - Premier's investment in Circum is classified as an
FVOCI as such is required to be measured at fair value at the reporting date.
As Circum is unlisted there are no quoted market prices. In previous years the
fair value of the Circum shares was derived using the most recent placing
price. The Fair value of the Circum shares as at 31 December 2021 was derived
using the most recent placing price in May 2021. Subsequent to the year end
100% of Premier's investment in Circum was sold to Vortex Limited at book
value in exchange for shares in Vortex Limited.
· Investments - Premier's investment in MNH is classified as an FVOCI
as such is required to be measured at fair value at the reporting date. As MNH
is unlisted there are no quoted market prices. The Fair value of the MNH
shares as at 31 December 2021 was derived using the purchase price in July
2019.
· Valuation of warrants, share options and ordinary shares issued as
consideration - judgement is applied in determining appropriate assumptions to
be used in calculating the fair value of the warrants, shares and share
options issued. Refer accounting policy note and note 20.
· Provision for Rehabilitation - A provision is recognised for site
rehabilitation and decommissioning of current mining activities based on
current environmental and regulatory requirements. The net present value of
the provision is calculated at a discount rate of 10% over an 8 year life of
mine.
· The life of mine has subsequently been reassessed to a total of 10
years. The corresponding rehabilitation assets were capitalised to property,
plant and equipment and is depreciated over the life of the mine.
5. Going Concern
These consolidated financial statements are prepared on the going concern
basis. The going concern basis assumes that the Group will continue in
operation for the foreseeable future and will be able to realise its assets
and discharge its liabilities and commitments in the normal course of
business.
The Group has an operating profit from continuing operations amounting to
$2.366 million (2020: loss of $1.311 million) and negative cash flows from
operations amounting to $2.540 million for the year ended 31 December 2021
(2020: $0.783 million) as the Group continued to maintain RHA in care and
maintenance, attempted to advance Zulu through the EPO and the commencement of
a Definitive Feasibility Study and external partners joint venture processes
described above in this report and explored new opportunities to diversify and
mitigate general risks associated with its Zimbabwe based projects.
As at 31 December 2021, current assets exceeded current liabilities by $0.583
million (2020: current assets exceeded current liabilities by $0.230 million).
The Group raised $3.609 million (2020: $2.343 million) in net funding through
share subscriptions to fund holding costs at RHA, general group maintenance
and preservation of assets and to investigate and assess potential
diversification, through potential investments in cash generating assets, as
discussed above.
The Directors have prepared cash flow forecasts for the period ending 31
December 2022, on the basis of the following considerations.
RHA
· The Company has not funded any of the activities at RHA since 1
July 2019, apart from essential care and maintenance costs.
Zulu
· During March 2021, the EPO was granted and subsequently a DFS has
commenced, which is still ongoing.
· The Company has fully funded the DFS through capital raises.
MNH
· The Group is anticipating deriving a return on its current
investment in MNH in the latter portion of 2022.
· The Company has received the June 2020 audited financial
statements which reflects a profit of N$4.4 million for the year. The December
2021 management accounts reflects a loss of N$45.6 million ($3 million).
The Group
· During the course of the year ended 31 December 2021 the Company
issued 1,625,000,000 shares with a total value of $3.839 million. These funds
were used to fund continuing operations and acquire the investments as listed
in note 8 and 9.
· In March 2022 the Group issued 30,000,000 shares at a price of
0.40p per share raising a total of
£12 million. This cash is being used to complete the Zulu DFS. No additional
capital raises are planned at this stage.
· The Company will seek to diversify its operations and risk
profile and limit the funds that need to be raised through equity placements
to provide necessary funding for the Company's significantly reduced fixed
overhead.
6. Operating segments
The group has the following three reportable segments that are managed
separately due to the different jurisdictions.
Segmental results, assets and liabilities include items directly attributable
to a segment as well as those that can be allocated on a reasonable basis.
Reportable segments Operations
RHA and RHA Mauritius Development and mining of Wolframite
Zulu and Zulu Mauritius Development of Lithium and Tantalite
Head office General administration and control
By operating segment Unallocated Corporate RHA Tungsten Mine Zimbabwe and RHA Mauritius* Exploration Zulu Lithium Zimbabwe and Zulu Mauritius Total continued operations
2021 $ 000 $ 000 $ 000 $ 000
Result
Revenue - - - -
Operating loss / (income) 1 543 107 730 2 380
Other income - - - -
Fair value movement on investment - - - -
Impairment of RHA - - - -
Finance charges - 18 - 18
Reversal of Impairment of Zulu - - (4 563) (4 563)
Loss before taxation 1 421 114 (3 833) (2 298)
Assets
Exploration and evaluation assets 123 - 4 563 4 686
Investments 8 342 - - 8 342
Inventories - 1 - 1
Trade and other receivables 11 5 370 386
Cash 919 2 41 962
Total assets 10 254 8 5 113 15 375
Liabilities
Other financial liabilities - - - -
Borrowings (180) - - (180)
Bank overdraft - - - -
Trade and other payables (557) (28) - (585)
Provisions - (362) - (362)
Total liabilities (737) (390) - (1 127)
Net assets 9 517 (382) 5 113 14 248
Other information
Depreciation and amortisation - - 14 14
Property plant and equipment additions - - 154 154
Costs capitalised to intangible assets 3 - - 3
By operating segment Unallocated Corporate RHA Tungsten Mine Zimbabwe and RHA Mauritius* Exploration Zulu Lithium Zimbabwe and Zulu Mauritius Total continued operations
2020 $ 000 $ 000 $ 000 $ 000
Result
Revenue - - - -
Operating loss / (income) 1 087 93 11 1 191
Other income - (81) - (81)
Fair value movement on investment - - - -
Impairment of RHA - 3 - 3
Finance charges 60 22 - 82
Impairment of Zulu - - - -
Loss before taxation 1 147 118 11 1 276
Assets
Exploration and evaluation assets 120 - - 120
Investments 8 342 - - 8 342
Inventories - - - -
Trade and other receivables 2 5 - 7
Cash 722 5 - 727
Total assets 9 186 10 - 9 196
Liabilities
Other financial liabilities - - - -
Borrowings - - - -
Bank overdraft - - - -
Trade and other payables (356) (147) (2) (505)
Provisions - (153) - (153)
Total liabilities (356) (300) (2) (658)
Net assets 8 830 (290) (2) 8 538
Other information
Depreciation and amortisation - - - -
Property plant and equipment additions - 4 - 4
Costs capitalised to intangible assets 120 - - 120
*Represents 100% of the results and financial position of RHA Tungsten
(Private) Limited ("RHA") whereas the Group owns 49%. Non-controlling
interests are disclosed in note 21.
RHA Revenue is generated from sales to Noble Minerals, in line with RHA's
off-take agreement.
7. Hyper-inflationary accounting
In terms of IAS29, Hyperinflation is indicated by characteristics of the
economic environment of a country which include, but are not limited to, the
following:
a) the general population prefers to keep its wealth in non‑monetary
assets or in a relatively stable foreign currency. Amounts of local currency
held are immediately invested to maintain purchasing power;
b) the general population regards monetary amounts not in terms of the
local currency but in terms of a relatively stable foreign currency. Prices
may be quoted in that currency;
c) sales and purchases on credit take place at prices that compensate
for the expected loss of purchasing power during the credit period, even if
the period is short;
d) interest rates, wages and prices are linked to a price index; and
e) the cumulative inflation rate over three years is approaching, or
exceeds, 100%.
As stated in the 2018 annual financial statements, with effect of the 21(st)
of February 2019 Zimbabwe implemented the Real Time Gross Settlement of US
Dollars ("RTGS") at an official exchange rate of 1:1. At that time the
official inflation rate was 0%. At the year end the official exchange rate has
moved to
RTGS 105.6684 : $1 (2020: RTGS 81,8151 : $1) whilst the official inflation
rate has moved to 58,40% (2020: 401.66%) on a year on year basis. The table
below details the exchange rates and inflation rates, as published by
https://tradingeconomics.com/zimbabwe/inflation-cpi
(https://tradingeconomics.com/zimbabwe/inflation-cpi) , on a monthly basis for
the year ended 31 December 2021.
Inflation Rate Exchange Rate RTGS : US$ Inflation Rate Exchange Rate RTGS : US$
2021 2021 2020 2020
January 362.63% 82.6756 175.66% 17.3531
February 321.59% 83.8868 540.16% 17.9594
March 240.55% 84.4001 676.39% 25.0000
April 194.07% 84.5032 765.57% 25.0000
May 161.91% 84.7259 785.55% 25.0000
June 106.60% 85.4234 737.26% 57.3582
July 56.37% 85.6402 837.53% 76.7596
August 50.24% 85.9084 761.02% 83.3994
September 51.55% 87.6653 659.40% 81.4439
October 54.50% 97.1361 471.25% 81.3531
November 58.40% 105.6684 401.66% 81.8151
December 60.70% 108.6660 348.59% 81.7866
Two of the group's subsidiaries, namely RHA and Zulu, operate in Zimbabwe.
In accordance with IAS29 the group has implemented the Historical Cost
approach in restating the subsidiary accounts as at the 31 December 2021 and
the corresponding comparative figures for the year ended 31 December 2020.
The financial statements reflect the reduction in the purchasing power of RTGS
which have been remeasured, in terms of IAS 29, as at 31 December 2021.
8. Intangible assets
2021 2020
$ 000 $ 000
Exploration and evaluations assets 4 686 120
Total intangible assets 4 686 120
Opening carrying value 2020 120 -
Expenditure on Exploration and evaluation - 120
Impairment of Exploration and evaluation assets - -
Closing carrying value 2020 120 120
Reversal of impairment of Zulu Lithium's E&E assets 4 563 -
Additional costs capitalised to the Li3 assets 3 -
Closing carrying value 2021 4 686 -
During the year, the market conditions for lithium improved substantially.
This improvement enabled management to revisit the assumptions surrounding the
impairment of the Zulu Lithium Exploration and Evaluation assets. Based upon
the current market conditions and associated assumptions, management has
reversed the impairment of the Zulu Lithium's Exploration and Evaluation
assets.
During the 2020 year the company acquired a portfolio of hard-rock lithium
assets located in Zimbabwe and Mozambique from Lithium Consolidated Ltd
("Li3").
Zulu Lithium and Tantalite Project
During the year $nil (2020: $nil) exploration costs were incurred and
capitalised to Zulu. The Group views this project as strategic and exploration
work will be continued in the future, cash flow permitting.
Key assumptions applied in calculating the discounted cash flow analysis
included:
· Targeted annual production of spodumene
concentrate
84 000 tonnes
· Targeted annual production of petalite
concentrate
32 500 tonnes
· Price of spodumene
concentrate
$975/t
· Price of petalite
concentrate
$400/t
· Discount rate
25%
· Operating costs per combined tonnage of
concentrate
$486/t
· Estimated 15 year life of mine
· Average strip ratio of
5.5:1
During March 2021, the EPO was granted and a DFS is being undertaken.
For additional information on events after the reporting date, refer to note
33.
9. Investments
Circum Manganese Total
Minerals Namibian
Holdings
$ 000 $ 000 $ 000
Opening carrying value 2020 6 263 - 6 263
Shares acquired - 2 079 2 079
Fair value adjustment - - -
Closing carrying value 2020 6 263 2 079 8 342
Shares acquired - - -
Fair value adjustment - - -
Closing carrying value 2021 6 263 2 079 8 342
Reconciliation of movements in investments
Opening carrying value 2020 (1) (2) 6 263 - 6263
Acquisition at fair value 2020 (3) - 2 079 2 079
Opening carrying value 2021 6 263 2 079 8 342
Acquisition of shares - - -
Acquisition at fair value - - -
Closing carrying value 2021 6 263 2 079 8 342
(1) Represents 2 million shares in unlisted entity Circum.
(2) As Circum is unlisted there are no quoted markets. The fair value of the
Circum shares was derived using the previous issue price and validating it
against the most recent placing price on 11 May 2021 of $1.25 per share. In
March 2022, the shares were sold at book value to Vortex Limited in exchange
for shares in Vortex Limited, see note 32 for additional information.
(3) Represents a purchase of 11% interest in MNH.
(4) Represents the purchase of 8.9% interest in MNH.
The shares are considered to be level 3 financial assets under the IFRS 13
categorisation of fair value measurements.
Premier continues to hold 5,010,333 shares in Circum currently valued in total
at $6.263 million. Circum has published a general update to shareholders in
May 2021 and the major shareholders and directors are now fully coordinated in
their intention to generate a liquidity event for shareholders. Novopro has
been appointed to complete a DFS for an initial production of ± 375ktpa of
Sulphate of Potash which will be scaled up to 750Ktpa over time. To this
effect a fully subscribed rights issue raised $12.5 million.
The fair value of these investments on 31 December 2021 amounted to $8.342
million (2020: $8.342 million).
Premier's investment in Circum is classified as FVOCI and as such is required
to be measured at fair value at each reporting date. As Circum is unlisted
there are no quoted market prices. The fair value of the Circum shares was
derived using the previous issue price and validating it against the most
recent placing price on 11 May 2021.
Premier's investment in MNH is classified as FVOCI and as such is required to
be measured at fair value at each reporting date. As MNH is unlisted there are
no quoted market prices. The fair value of the MNH shares was based on the
latest transactions and supported by an external evaluation conducted by Bara
Consulting.
Sensitivity analysis
The investments are subject to changes in market prices. A 10% reduction in
market prices would result in a $0.834 million (2020: $0.834 million) charge
to Other Comprehensive Income.
10. Property, plant and equipment
Mine Development Plant and Equipment Land and Buildings Total
$ 000 $ 000 $ 000 $ 000
Cost
At 1 January 2020 1 465 2 898 79 4 442
Exchange differences (1) (565) (227) (51) (843)
Additions - 4 - 4
Disposals - - - -
At 31 December 2020 900 2 675 28 3 603
Exchange differences (1) (4) (3) (1) (8)
Additions - 140 14 154
Disposals - - - -
At 31 December 2021 896 2 812 41 3 749
Accumulated Depreciation and Impairment Losses
At 1 January 2020 1 465 2 898 79 4 442
Charge for the period - - - -
Exchange differences (1) (565) (227) (51) (843)
Charge for the year - - - -
Impairment of RHA - 4 - 4
At 31 December 2020 900 2 675 28 3 603
Exchange differences (1) (4) (2) (1) (7)
Charge for the year - 14 - 14
Impairment - - - -
At 31 December 2021 896 2 687 27 3 610
Net Book Value
At 31 December 2020 - - - -
At 31 December 2021 - 125 14 139
Refer to note 7 Hyperinflationary Accounting.
The impairment assessment is detailed in note 4, Significant accounting
judgements, estimates and assumptions.
Refer note 15, Other financial liabilities for capitalised lease assets.
11. Loans receivable
2021 2020
$ 000 $ 000
Outback Investments Pty Ltd 414 -
Otjozondu Mining (Pty) Ltd 445 -
859 -
The above loans are made to a subsidiary and a related party of MN Holdings
(Pty) Ltd and are held at amortised cost.
The purpose of the Outback Investments Pty Ltd loan was to enable MNH to lease
and acquire the remaining extent of the Ebenezer No 377 Farm which contains
untreated tailings facilities from the Purity Mining Project as announced on
the 8(th) of July 2019. The loan will be forgiven following the uninterrupted
use of the farm land for the treatment of the tailing facilities for a period
of up to 10 years. During this period Premier has rights to these tailings
facilities. The loan is interest free. The loan is only repayable upon default
by Outback Investments.
The loan to Otjozondu Mining is to assist with funding the day to day
operations and is in accordance with the RNS of 31(st) August 2021. Premier
has provided a loan of $265,000 which bear interest of 20% and is repayable in
instalments of $25,000 per shipment of manganese shipped from Namibia. The
balance of $180,000 has been provided interest free as it is linked to the
loan from Neil Herbert, see note 18 for additional information.
12. Inventories
2021 2020
$ 000 $ 000
Mine consumables - 1
- 1
13. Trade and other receivables
2021 2020
$ 000 $ 000
The exposure to credit risk for trade receivables
by geographic region was as follows:
Zimbabwe - 8
Other - -
- 8
The exposure to credit risk for trade receivables
by counterparty was as follows:
Zimbabwe Revenue Authority - 3
Other - 2
- 5
The exposure to credit risk for trade receivables
by credit rating was as follows:
External credit ratings - -
Other - 8
- 8
The receivables are considered to be held within a held-to-collect business
model consistent with the Group's continuing recognition of the receivables.
As at 31 December 2021 the Group does not have any contract assets nor any
contract liabilities arising out of contracts with customers relating to the
Group's right to receive consideration for work completed but not billed.
Credit and market risks, and impairment losses
The Group did not impair any of its trade receivables as at 31 December 2021,
as all trade receivables generated during the financial year were settled in
full prior to the year-end.
Information about the Group's exposure to credit and market risks and
impairment losses for trade receivables is included in Note 30.
The Directors consider that the carrying amount of trade and other receivables
approximates their fair value.
14. Cash and cash equivalents
2021 2020
$ 000 $ 000
Bank balances 963 727
Cash and cash equivalents per the statement of cash flows 963 727
15. Finance lease liabilities
Finance lease
During 2015, the Group entered into a finance lease with Board Market Trading
258 (Pty) Ltd for the purchase of two generators with a net book value of
$0.124 million to be used at RHA. The finance lease is for a term of 48 months
with interest charged at 19.5% per annum with monthly repayments of $0.006
million beginning from 1 August 2016. Depreciation of leased assets amounted
to nil (2019: $nil) due to the assets being fully impaired in a prior period.
The agreement is classified as a finance lease as the rental period equal the
estimated useful life of the assets concerned and the Group has the right to
purchase the assets outright at the end of the minimum lease term by paying a
nominal amount.
In terms of IFRS 16 Leases, short term lease agreements which are less than
one month or with total present value of lease payments not exceeding $0.005
million are excluded from capitalisation.
Future lease payments are due as follows:
Minimum lease payments Interest Present value of minimum lease payments
2021 $ 000 $ 000 $ 000
Not later than one year - - -
Between one year and five years - - -
- - -
Minimum lease payments Interest Present value of minimum lease payments
2020 $ 000 $ 000 $ 000
Not later than one year - - -
Between one year and five years - - -
- - -
Reconciliation
Minimum lease payments Interest Present value of minimum lease payments
Balance as at 31 December 2019 36 1 35
Payments made during the year 36 1 35
Balance as at 31 December 2020 - - -
Payments made during the year - - -
Balance as at 31 December 2021 - - -
16. Provisions - rehabilitation
2021 2020
$ 000 $ 000
As at 1 January 153 388
Foreign Exchange variation on translation 191 (255)
Unwinding of discount 18 20
As at 31 December 362 153
A provision is recognised for site rehabilitation and decommissioning of
current mining activities based on current environmental and regulatory
requirements. The gross provision was based upon an environmental impact
assessment ("EIA") conducted and calculated in 2014 and discounted to a net
present value using a discount rate of 10% over a life of mine of 8 years. The
corresponding rehabilitation assets was capitalised to property, plant and
equipment and is depreciated over the life of the mine. The initial provision
for rehabilitation was performed in the then functional currency of USD. With
the implementation of RTGS this provision was restated in terms of note 7 on
Hyperinflationary accounting. With RHA currently under care and maintenance
the directors reassessed the final provision based upon actual volumes
extracted versus projected volumes. This reassessment will be done annually
taking into consideration the remaining volume of ore to be extracted, the
current level of mining that has already been conducted and the estimated
costs involved in rehabilitating the land.
17. Trade and other payables
2021 2020
$ 000 $ 000
Trade payables 280 238
Accrued expenses 298 253
Payroll liabilities 8 14
586 505
All trade and other payables at 31 December 2021 are due within one year,
non-interest bearing, and comprise amounts outstanding for mine purchases and
on-going costs, except as described further below. The Directors consider that
the carrying amount of trade and other payables approximates their fair value.
18. Borrowings
2021 2020
$ 000 $ 000
Loan Neil Herbert 180 -
180 -
2021 2020
$ 000 $ 000
Reconciliation of movement in borrowings
As at 1 January - 715
Loans received (1) (2) 180 200
Loans repaid through conversion to equity (1) (3) (4) - (965)
Implementation fee - 15
Accrued interest - 35
As at 31 December 180 -
Current 180 -
Non-current - -
180 -
Borrowings comprise loans from a related party and a non-related party. Loans
from a related party are further disclosed in Note 32, Related Party
Transactions.
(1) Neil Herbert made available a loan of US$180,000 to the Company.
Under the terms of the Director Loan, the loan is both unsecured and will not
attract any interest and is repayable in full by the Company on the signing of
a new off-take agreement at Otjozondu. The purpose of the Director Loan is to
provide funding to Premier to allow an amendment to the Otjozondu Loan while
Premier, acting collectively with Otjozondu, looks to secure the best possible
off-take funding package.
At 31 December 2021 the off-take funding had not been secured and Mr Herbert
has agreed to the deferment of the repayment of the loan until such off-take
agreement has been secured.
(2) As at 31 December 2021 nil was outstanding to George Roach. In
March 2020 the Company entered into a secured $0.200 million Loan Agreement
and related Subscription Agreement with a company owned by a Trust of
which George Roach is a beneficiary at 10% interest per annum. In July
2020 $0.206 million was settled by issue of 232,647,763 ordinary shares and in
October 2020 the balance of $0.237 million was settled by issue of 456,291,154
ordinary shares.
(3) As at 31 December 2021 nil was outstanding to Brendan Roach. In
October 2020 $0.132 million including interest was settled by issue of
241,117,500 ordinary shares.
(4) As at 31 December 2021 nil was outstanding to Regent Mercantile
Holdings Limited. In July 2020 $0.0.390 million including interest was settled
by issue of 431,241,920 ordinary shares.
19. Share capital
Authorised share capital
19.42 billion (2020: 17.79 billion) ordinary shares of no par value.
Issued share capital
Number of Shares Value
'000 $ 000
As at 1 January 2020 11 266 071 51 035
Shares issued on conversion of loan (1) 171 074 199
Shares issued on conversion of loan (2) 498 230 699
Shares issued on conversion of loan (3) 431 242 390
Shares issued on conversion of loan (4) 70 427 56
Shares issued under subscription agreement (5) 124 513 120
Shares issued on conversion of loan (6) 232 648 206
Shares issued on conversion of loan (7) 64 470 51
Shares issued on conversion for fees (8) 374 921 437
Shares issued on conversion of loan (9) 62 450 50
Shares issued on conversion of loan (10) 125 905 76
Shares issued on conversion of loan (11) 120 915 65
Shares issued under subscription agreement (12) 2 750 000 1421
Shares issued on conversion for fees (13) 1 500 143 787
As at 31 December 2020 17 793 009 55 592
Shares issued for direct Investment (14) 625 000 1 417
Shares issued for direct Investment (15) 500 000 1 364
Shares issued for direct Investment (16) 500 000 1 059
As at 31 December 2021 19 418 009 59 432
Less cumulative share costs (3 319)
Net share capital as at 31 December 2021 56 113
(1) On the 06 February 2020, the Company issued 171 074 444 shares under a
subscription agreement at a price of 0.9p per share.
(2) On the 11 June 2020, the Company issued 498 229 730 shares under a
subscription agreement at a price of 0.111p per share.
(3) On 24 July 2020, the Company issued 431 241 920 shares at an issue price of
0.07092p per share for a total value of $0.390 million for conversion of loan.
(4) On 27 July 2020, the Company issued 70 426 740 shares at an issue price of
0.06264p per share for a total value of $0.056 million for conversion of loan.
(5) On the 28 July 2020, the Company issued 124 512 702 shares under a
subscription agreement at a price of 0,0744p for a total value of $0.120
million
(6) On the 30 July 2020, the company issued 232 647 763 shares for a total value
of $ 0.206 million for conversion of fees.
(7) On the 11 August 2020, the company issued 64 470 222 shares for a total value
of $ 0.051 million for conversion of fees.
(8) On the 11 August 2020, the company issued 374 920 533 shares for a total value
of $ 0.437 million for conversion of fees.
(9) On the 18 August 2020, the company issued 62 450 479 shares for a total value
of $ 0.050 million for conversion of fees.
(10) On the 21 September 2020, the company issued 125 905 202 shares for a total
value of $ 0.076 million for conversion of fees.
(11) On the 02 October 2020, the company issued 120 915 045 shares for a total
value of $ 0.065 million for conversion of fees.
(12) On the 21 October 2020, the Company issued 2 750 000 000 shares under a
subscription agreement at a price of 0,04p for a total value of $1.421 million
(13) On the 22 October 2020, the Company issued 1 500 143 471 shares at an issue
price of 0.04p per share for a total value of $0.787 million for conversion of
fees.
(14) On the 03 June 2021, the Company issued 625 000 000 shares under a
subscription agreement at a price of 0,16p for a total value of $1.501 million
(15) On the 17 August 2021 the Company issued 500 000 000 shares under a
subscription agreement at a price of 0,02p for a total value of $1.446 million
(16) On the 14 December 2021 the Company issued 500 000 000 shares under a
subscription agreement at a price of 0,16p for a total value of $1.122 million
Reconciliation to balance as stated in the consolidated statement of financial
position
2021 2020
$ 000 $ 000
As at 1 January 52 504 48 042
Shares issued under subscription agreements - cash flow - 1 541
Shares issued to settle trade payables - 1 225
Shares issued on conversion of loans and loan notes (note 12) - non-cash - 894
Shares issued to purchase Investment in MNH - 898
Share issue costs - cash flow (230) (96)
Shares issued for direct Investment 3 839 -
As at 31 December 56 113 52 504
20. Share based payment and warrant reserve
2021 2020
$ 000 $ 000
Share options and warrants reserve beginning of year 2 366 2 366
Warrants granted - -
Share options - -
Warrants cancelled - -
Share options and warrants reserve end of year 2 366 2 366
Share options and warrant arrangements are set out below.
Equity-settled Share base payment arrangement
The Company adopted an incentive share option plan (the 'Plan') during 2012.
The essential elements of the Plan provide that the aggregate number of common
shares of the Company's capital stock issuable pursuant to options granted
under the Plan may not exceed 15% of the issued and outstanding Ordinary
Shares at the time of any grant of options. Options granted under the Plan
will have a maximum term of 10 years. All options granted to Directors and
management are subject to vesting provisions of one to two years.
All options are to be settled by the physical delivery of shares.
The fair value of all the share options has been measured using the
Black-Scholes Model.
Issued to Date Granted Vesting Term Number of Options Granted Exercise Price Expiry Date Estimated Fair Value
'000
Employees and consultants 10/02/2011 1 year 2 250 1.135p 09/02/2014 0.87p
Directors 04/12/2012 See 1 below 20 386 Nil 03/12/2022 1.11p
Directors 04/12/2012 See 2 below 20 386 2p 03/12/2022 1.85p
Employees and associates
04/12/2012 See 3 below 5 536 Nil 03/12/2022 1.85p
Directors 29/07/2014 See 4 below 6 000 1.15p 28/07/2024 1.15p
Directors 29/07/2014 See 5 below 6 000 1.50p 28/07/2024 1.15p
Management 29/07/2014 See 4 below 6 500 1.15p 28/07/2024 1.15p
Management 29/07/2014 See 5 below 6 500 1.50p 28/07/2024 1.15p
Directors 13/03/2015 See 4 below 2 000 0.9p 12/03/2025 0.67p
Directors 13/03/2015 See 5 below 2 000 1.17p 12/03/2025 0.64p
Management 13/03/2015 See 4 below 3 250 0.9p 12/03/2025 0.67p
Management 13/03/2015 See 5 below 3 250 1.17p 12/03/2025 0.64p
Directors 19/01/2017 See 5 below 30 500 0.28p 18/01/2027 0.278p
Consultants 19/01/2017 See 5 below 50 439 0.28p 18/01/2027 0.278p
Directors 19/01/2017 See 5 below 30 500 0.40p 18/01/2027 0.28p
Consultants 19/01/2017 See 5 below 50 439 0.40p 18/01/2027 0. 28p
Total number of options 245 936
Issued to:
- Directors 111 772
- Employees and consultants 114 664
- Management 19 500
245 936
Less:
- Options exercised in prior years 27 257
- Options cancelled in prior years 18 330
Total options in issue at 31 December 2021 200 349
Expected volatility has been based on an evaluation of the historical
volatility of the Company's share price, particularly over the historical
period commensurate with the expected term. The expected term of the
instruments has been based on historical experience and general option holder
behaviour
The Company has granted the following share options during the years up to 31
December 2021:
1. These share options vest on the two-year anniversary of the grant
date. The options are exercisable at any time after vesting during the
grantee's period as an eligible option holder, and must be exercised no later
than 10 years after the date of grant, after which the options will lapse.
2. These share options vest in equal instalments annually on the
anniversary of the grant date over a two year period. The options are
exercisable at any time after vesting during the grantee's period as an
eligible option holder, and must be exercised no later than 10 years after the
date of grant, after which the options will lapse.
3. These share options vested on the grant date. The options are
exercisable at any time after vesting during the grantee's period as an
eligible option holder, and must be exercised no later than 10 years after the
date of grant, after which the options will lapse.
4. These share options vest on the one-year anniversary of the grant
date. The options are exercisable at any time after vesting during the
grantee's period as an eligible option holder, and must be exercised no later
than 10 years after the date of grant, after which the options will lapse.
5. These share options vest on the two-year anniversary of the grant
date. The options are exercisable at any time after vesting during the
grantee's period as an eligible option holder, and must be exercised no later
than 10 years after the date of grant, after which the options will lapse.
No share options were granted during the year ended 31 December 2021 (2020 -
none issued).
The fair value of the options granted during the year ended 31 December 2021
was $nil (2020: $nil). The assessed fair value of options granted to directors
and management was determined using the Black-Scholes Model that takes into
account the exercise price, the term of the option, the share price at grant
date, the expected price volatility of the underlying share, the expected
dividend yield and the risk-free rate interest rate for the term of the
option.
In issue prior to 1 January 2021 Exercised during the year Cancelled / Lapsed during the year Granted during the year In issue as at 31 December 2021
Directors:
- G. Roach 21 517 - - - 21 517
- N. Herbert 4 000 - - - 4 000
- W. Hampel 8 000 - - - 8 000
- M. Foster (resigned) 18 000 - - - 18 000
- Resigned directors 40 941 - - - 40 941
Other option holders 107 891 - - - 107 891
200 349 - - - 200 349
The Group has the following share options outstanding:
Grant Date Expiry Date Exercise Price Number of options outstanding Number of options vested and exercisable
'000 '000
04/12/2012 03/12/2022 Nil 2 013 2 013
04/12/2012 03/12/2022 2p 12 458 12 458
29/07/2014 28/07/2024 1.15p 3 000 3 000
29/07/2014 28/07/2024 1.50p 10 500 10 500
13/03/2015 12/03/2025 0.9p 5 250 5 250
13/03/2015 12/03/2025 1.17p 5 250 5 250
19/01/2017 18/01/2027 0.28p 80 939 80 939
19/01/2017 18/01/2027 0.40p 80 939 80 939
200 349 200 349
The following table lists the inputs into the valuation model.
19 Jan 19 Jan 13 Mar 13 Mar 29 Jul 29 Jul 4 Dec
2017 2017 2015 2015 2014 2014 2012
Issue Issue Issue Issue Issue Issue Issue
Dividend yield (%) - - - - - - -
Expected volatility (%) 236.0 236.0 100.0 100.0 148.0 148.0 75.0
Risk-free interest rate (%) 1.43 1.43 1.71 1.71 1.71 1.71 1.81
Share price at grant date 0.28p 0.28p 0.9p 0.9p 1.15p 1.15p 1.85p
Exercise price 0.28p 0.40p 0.9p 1.17p 1.15p 1.5p 2p and nil
The shares that the options are based on are quoted in GBP and so the option
agreement is stated in GBP. As such they are presented in GBP despite the
presentational currency of the Group being USD.
The number and weighted-average exercise prices of share options under the
share option programmes and replacement awards were as follows:
2021 2020
Weighted Average Exercise Price Weighted Average Exercise Price
Shares Shares
'000 '000
Options outstanding, beginning of year 200 349 0.55p 200 349 0.55p
Granted - - - -
Options outstanding, end of year 200 349 0.55p 200 349 0.55p
The weighted-average life of the options in issue as at 31 December 2021 is 3
years and 27 days (2020 - 4 years and 27 days.)
Warrants
The Company did not grant warrant options during the year (2020: nil)
A summary of the status of the Company's share warrants as of 31 December 2020
and changes during the year are as follows:
2021 2020
'000 '000
Warrants outstanding, beginning of year - -
Granted - -
Expired - -
Exercised - -
Cancelled * - -
Warrants outstanding, end of year - -
During the year ending 31 December 2021 nil (2020 - nil) warrants granted to
an advisor expired.
There are no warrants outstanding in favour of the Directors.
Premier's share price opened at 0.052p in January 2021, traded at an average
of 0.175p, with a high of 0.495 and low of 0.043p during the year and closed
at 0.19p on 31 December 2021.
21. Non-controlling interest
2021 2020
RHA Tungsten Limited (51% Non-controlling interest) $ 000 $ 000
At 1 January (11 726) (11 499)
Foreign exchange and hyper-inflationary adjustments - 220
Non-controlling interest in share of profit / (losses) for the year - RHA (145) (23)
Non-controlling interest in share of other comprehensive income for the period (438) (424)
At 31 December (12 309) (11 726)
The following table summarises the information relating to each of the Group's
subsidiaries that has material Non-controlling interest, before any
intra-group eliminations.
2021 2020
RHA RHA
Non-controlling Interest percentage 51% 51%
Non-current assets - -
Current assets 8 10
Non-current liabilities (18 493) (18 041)
Current liabilities (5 651) (4 961)
Net assets (24 136) (22 992)
Net assets attributed to Non-controlling Interest (12 310) (11 726)
Revenue - 13
Profit / (Loss) (858) (832)
Other Comprehensive Income /(Loss) (286) (43)
Total comprehensive income (1 144) (875)
Loss allocated to NCI (584) (447)
The share of losses in the year represents the losses attributable to
non-controlling interests in RHA for the year.
22. Revenue
2021 2020
$ 000 $ 000
Major product/service lines
Sale of Wolframite - -
Sale of scrap - -
Reserve Bank of Zimbabwe Export Incentive - -
Total revenue - -
NIEEF refund of expenses - 6
Prescription of debts 133 75
Total other income 133 81
Gross revenue 133 81
Primary Geographical Markets
Africa 133 81
133 81
Timing of revenue recognition
Products transferred at a point in time 133 81
133 81
23. Cost of sales excluding depreciation and amortisation
2021 2020
$ 000 $ 000
Mining contractor - -
Staff costs - -
Consumables - -
Equipment hire and maintenance - -
Mining services - -
Plant services - -
Selling costs - -
Net realisable value adjustment of cost of inventory sold - -
Inventory write-down / (write-up) - -
- -
RHA mine is under care and maintenance and accordingly there are no cost of
sales.
24. Administrative expenses
2021 2020
$ 000 $ 000
Audit fees - Holding company 44 22
- Under provision prior year 3 -
- Over provision prior year - (6)
Staff costs 31 19
Consulting and advisory fees 1 199 793
Directors' fees 118 35
Accounting and legal fees 143 142
Marketing and public relations 3 17
Travel 50 40
Security costs 7 2
Vehicle operating costs 9 9
Insurance 8 8
Office and administration 88 32
Short term non-capitalised lease payments (note 15) 114 114
Foreign exchange losses 12 47
Share based payment (note 21) - -
Exploration costs 537 -
2 366 1 274
Number of staff 2021 2020
Directors of the Holding Company 4 4
Administrative staff 0 0
Total Holding Company staff 4 4
Directors of subsidiaries 1 1
Subsidiary administrative and operating staff 6 6
Total staff 11 11
25. Finance charges
2021 2020
$ 000 $ 000
Interest charged by suppliers - -
Interest on borrowings - 61
Derivative financial liability transaction costs - -
Unwinding of discount on provisions 18 20
Loss on extinguishment of debt - -
Interest on finance lease - 1
18 82
26. Taxation
Deferred tax 2021 2020
$ 000 $ 000
As at 1 January - -
As at 31 December - -
Income Tax
Taxation charge for the year - -
There is no taxation charge for the year ended 31 December 2021 (2020: Nil)
because the Group is registered in the British Virgin Islands where no
corporate taxes or capital gains tax are charged. However, the Group may be
liable for taxes in the jurisdictions of the underlying operations.
The Group has incurred tax losses in West Africa and Zimbabwe; however a
deferred tax asset has not been recognised in the accounts due to the
unpredictability of future profit streams. The accumulated tax losses not
recognised at RHA amount to RTGS 1,615.272 million (2020: RTGS 52.342
million).
Reconciliation of effective tax rate 2021 2021 2020 2020
$ 000 $ 000
Loss before tax from continuing operations 2 099 - (1 333) -
Tax using the Zimbabwean company tax rate 25% (525) 25% 333
Tax effect of:
Effects of tax rates in foreign jurisdictions (25%) 525 (25%) (333)
Contingent liability
The Group operates across different geographical regions and is required to
comply with tax legislation in various jurisdictions. The determination of the
Group's tax is based on interpretations applied in terms of the respective tax
legislations and may be subject to periodic challenges by tax authorities
which may give rise to tax exposures.
27. Loss per share
The calculation of loss per share is based on the loss after taxation
attributable to shareholders, divided by the weighted average number of shares
in issue during the year:
2021 2020
$ 000 $ 000
Net loss attributable to owners of the company ($ 000) 2 099 (1 333)
Weighted average number of Ordinary Shares in calculating basic earnings per 18 337 187 13 167 281
share ('000)
Basic loss per share (US cents) 0.01 (0.01)
Diluted loss per share (US cents) 0.01 (0.01)
Weighted average number of ordinary shares
Issued ordinary shares at 1 January ('000) 17 793 009 11 266 071
Weighted average of shares issued during the year ('000) 544 178 1 901 210
Weighted average number of ordinary shares at 31 December ('000) 18 337 187 13 167 281
As the Group incurred a loss for the year, there is no dilutive effect from
share options and warrants in issue or the shares issued after the reporting
date.
2021 2020
Potential dilutive effect on earnings per share $ 000 $ 000
Options issued 200 349 200 349
Warrants issued - -
Convertible loan notes - -
Total potentially dilutive shares 200 349 200 349
Refer to note 33 Post balance sheet events for additional potentially dilutive
transactions.
28. Directors' remuneration
Directors' fees Consultancy Fees Share Options Total
2021 $ 000 $ 000 $ 000 $ 000
Executive Directors
George Roach - current - 275 - 275
- backdated increase 70
Non-Executive Directors
Godfrey Manhambara - current 42 - - 42
- backdated increase 45
Wolfgang Hampel 31 - - 31
Neil Herbert - 36 - 36
118 381 - 384
Directors' fees Consultancy Fees Share Options Total
2020 $ 000 $ 000 $ 000 $ 000
Executive Directors
George Roach - 240 - 240
Non-Executive Directors
Godfrey Manhambara 19 - - 19
Wolfgang Hampel 16 - - 16
Neil Herbert (*) - 33 - 33
35 273 - 308
(*) These directors were not employed during the full financial year.
The Directors' fees disclosed in note 24 include nil (2020: nil) being the
fees paid to Directors of RHA, who are not directors of the parent company.
29. Notes to the statement of cash flows
Cash and cash equivalents comprise cash at bank, bank overdrafts and
short-term bank deposits with an original maturity of three months or less.
The carrying value of these assets is approximately equal to their fair value.
2021 2020
$ 000 $ 000
Profit / (Loss) before tax 2 099 (1 333)
Adjustments for:
Finance charges 18 82
Foreign exchange variations 192 51
Settlement agreement on Finance lease - (74)
Impairment of PPE - RHA - 4
Reversal of Impairment of intangible assets - Zulu (4 566) -
Depreciation and amortisation 14 -
Operating cash flows before movements in working capital (2 243) (1 270)
(Increase)/decrease in inventories 1 -
(Increase)/decrease in receivables (379) 9
Increase/(decrease) in payables 81 478
Net cash (outflow) from operating activities (2 540) (783)
2021 2020
Reconciliation of Non-Cash Transactions $ 000 $ 000
Share Capital
Shares issued 3 839 4 558
Less: Share issue costs (230) (96)
Less: Settlement of payables - (2 119)
3 609 2 343
Finance Charges
Finance charge expense (18) (82)
Less: Unwinding of discount on the Provision for rehabilitation 18 20
Less: Interest accrued on loans and other payables - 61
- (1)
Net Debt Reconciliation for the Group
Cash and Right of use
cash lease Total
equivalents Borrowings liability debt Net debt
£ £ £ £ £
Net debt as at 31 December 2019 24 (715) (34) (749) (725)
Cash flows 753 715 34 749 1 502
Foreign exchange adjustments (51) - - - (51)
Net debt as at 31 December 2020 726 - - - 726
Cash flows 44 (120) - (120) (76)
Foreign exchange adjustments 192 - - - 192
Net debt as at 31 December 2021 962 (120) - (120) 842
30. Financial Instruments - Fair values and risk management
The following table shows the carrying amounts and fair values of financial
assets and financial liabilities, including their levels in the fair value
hierarchy. It does not include fair value information for financial assets and
financial liabilities not measured at fair value if the carrying amount is a
reasonable approximation of fair value.
Trade and other receivables and trade and other payables classified as
held-for-sale are not included in the table below. As at 31 December 2021 the
Group did not have any trade and other receivables nor any trade and other
payables that were classified as held-for-sale.
The Group has not disclosed the fair values of financial instruments such as
short-term trade receivables and payables, because their carrying amounts are
a reasonable approximation of their fair value.
Carrying value Fair value
31 December 2021 FVOCI - equity instruments Financial assets at amortised cost Other financial liabilities Total Level 1 Level 2 Level 3 Total
Note $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Financial assets measured at fair value
FVOCI 8 342 - - 8 342 - - 8 342 8 342
8 342 - - 8 342
Financial assets not measured at fair value
Trade and other receivables - 859 - 859
Cash and cash equivalents - - - -
- 859 - 859
Financial liabilities measured at fair value
- - - -
- - - -
Financial liabilities not measured at fair value
Bank overdrafts - - - -
Unsecured loans from shareholders - - - -
Secured loan - - - -
Trade and other payables - - (586) (586)
- - (586) (586)
Carrying value Fair value
31 December 2020 FVOCI - equity instruments Financial assets at amortised cost Other financial liabilities Total Level 1 Level 2 Level 3 Total
Note $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Financial assets measured at fair value
FVOCI 8 342 - - 8 342 - - 8 342 8 342
8 342 - - 8 342
Financial assets not measured at fair value
Trade and other receivables - 8 - 8
Cash and cash equivalents - - - -
- 8 - 8
Financial liabilities measured at fair value
- - - -
- - - -
Financial liabilities not measured at fair value
Bank overdrafts - - - -
Unsecured loans from shareholders - - - -
Secured loan - - - -
Trade and other payables - - (505) (505)
- - (505) (505)
Financial instruments - Fair values and risk management
B. Measurement of fair values
i. Valuation techniques and significant unobservable
inputs
The following tables show the valuation techniques used in measuring Level 3
fair values for financial instruments measured at fair value in the statement
of financial position, as well as the significant unobservable inputs used.
Related valuation processes are described in Note 4.8.
Financial instruments measured at fair value
Type Valuation technique Significant unobservable inputs Inter-relationship between significant unobservable inputs and fair value
measurement
Unlisted Equity investments Current market value technique: None None
The valuation model is based upon the latest price at which the unlisted
entity raised capital.
ii. Transfers between Levels 1 and 2
There were no transfers between Levels 1 and 2 in either the current financial
year or in the prior financial year.
C. Financial Risk Management
The Group has exposure to the following risks arising from financial
instruments:
- credit risk;
- liquidity risk; and
- market risk.
Risk management framework
The Company's board of directors has overall responsibility for the
establishment and oversight of the Group's risk management framework.
The Group's risk management policies are established to identify and analyse
the risks faced by the Group, to set appropriate risk limits and controls and
to monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the
Group's activities.
The Group's audit committee oversees how management monitors compliance with
the Group's risk management policies and procedures, and reviews the adequacy
of the risk management framework in relation to the risks faced by the Group.
The Group's audit committee undertake ad hoc reviews of risk management
controls and procedures, the results of which are reported to the audit
committee.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations and arises principally from the Group's receivables from customers
and investments in debt securities.
The carrying amounts of financial assets represent the maximum credit
exposure.
In the current year there was no impairment loss, nor 2019, for unrecoverable
sundry debtors.
Trade receivables
The Group's exposure to credit risk is influenced mainly by the individual
characteristics of each customer. However, management also considers the
factors that may influence the credit risk of its customer base, including the
default risk associated with the industry and country in which its customers
operate. Details of concentration of revenue are included in Note 22.
The Group has established a credit policy under which each new customer is
analysed individually for creditworthiness before the Group's standard payment
terms and conditions are offered. The Group's review includes external
ratings, if they are available, financial statements, credit agency
information, industry information and in some cases bank references. Sales
limits are established for each customer and are reviewed regularly.
The Group limits its exposure to credit risk from trade receivables by
establishing a maximum payment period of one month.
The Group is monitoring the economic environment in Zimbabwe, where its
exploration and mining operations are based.
The Group does not require collateral in respect of trade and other
receivables. The Group does not have trade receivables for which a no
allowance is recognised because of collateral.
2021 2020
$ 000 $ 000
The exposure to credit risk for trade receivables
by geographic region was as follows:
Zimbabwe - 6
Other - -
- 6
The exposure to credit risk for trade receivables
by counterparty was as follows:
Zimbabwe Revenue Authority 5 3
Other - 2
5 5
The exposure to credit risk for trade receivables
by credit rating was as follows:
External credit ratings - -
Other 5 5
5 5
Expected credit loss assessment for corporate customers as at 1 January 2021
and 31 December 2021
The Group allocates each exposure to a credit risk grade based on data that is
determined to be predictive of the risk of loss (including but not limited to
external ratings, audited financial statements, management accounts and cash
flow projections and available press information about customers) and applying
experienced credit judgement. Credit risk grades are defined using qualitative
and quantitative factors that are indicative of the risk of default.
The company had no exposure to credit risk for the year ended 31 December 2021
(2020 - nil)
Movements in the allowance for impairment in respect of trade receivables
The movement in the allowance for impairment in respect of trade receivables
during the year amounted to nil (2020 - nil).
Cash and cash equivalents
As at 31 December 2021, the Group held $0.963 million in cash and cash
equivalents (2020: $0.727 million). The cash and cash equivalents are held
with bank and financial institution counterparties which are rated BB to BAA
(according to Standard and Poor's).
Impairment on cash and cash equivalents has been measured on a 12-month
expected loss basis and reflects the short maturities of the exposures. The
Group considers that its cash and cash equivalents have low credit risk based
on the external credit ratings of the counterparties. On the implementation of
IFRS 9 the Group did not impair any of its cash and cash equivalents.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting
the obligations associated with its financial liabilities that are settled by
delivering cash or another financial asset. The Group's approach to managing
liquidity is to ensure, as far as possible, that it will have sufficient
liquidity to meet its liabilities when they are due, under both normal and
stressed conditions, without incurring unacceptable losses or risking damage
to the Group's reputation.
Exposure to liquidity risk
The following table presents the remaining contractual maturities of financial
liabilities at the reporting date. The amounts are gross and undiscounted and
include contractual interest payments and exclude the impact of netting
agreements.
Contractual cash flows
31 December 2021 Carrying value Total 2 Months or less 2 to 12 Months 1 to 2 Years 2 to 5 Years More than 5 years
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Non- derivative financial
liabilities
Bank overdrafts - - - - - - -
Unsecured shareholder's
loan - - - - - - -
Unsecured loans - - - - - - -
Secured loans - - - - - - -
Trade payables (586) (586) (586) - - - -
(586) (586) (586) - - - -
Derivative financial - - - - - - -
liabilities - - - - - - -
- - - - - - -
Contractual cash flows
31 December 2020 Carrying value Total 2 Months or less 2 to 12 Months 1 to 2 Years 2 to 5 Years More than 5 years
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
Non- derivative financial
liabilities
Bank overdrafts - - - - - - -
Unsecured shareholder's
loan - - - - - - -
Unsecured loans - - - - - - -
Secured loans - - - - - - -
Trade payables (505) (505) (505) - - - -
(505) (505) (505) - - - -
Derivative financial - - - - - - -
liabilities - - - - - - -
- - - - - - -
The interest payments on the financial liabilities represent the fixed
interest rates as per the respective contracts.
The Group aims to maintain the level of its cash and cash equivalents and
other highly marketable debt investments at an amount in excess of expected
cash outflows on financial liabilities other than trade payables. The Group
also monitors the level of expected cash inflows on trade and other
receivables together with expected cash outflows on trade and other payables.
Market risk
Market risk is the risk that changes in market prices - such as foreign
exchange rates, interest rates and equity prices - will affect the Group's
income or the value of its holdings of financial instruments. The objective of
market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return.
Currency risk
The Group is exposed to transactional foreign currency risk to the extent that
there is a mismatch between the currencies in which sales, purchases,
receivables and borrowings are denominated and the respective functional
currencies of Group companies. The functional currencies of Group companies
are primarily Pound Sterling and the US Dollar. The Zimbabwean trading
companies functional currency is RTGS. The currencies in which these
transactions are primarily denominated are Euro, US Dollar, South African
Rand, RTGS and Pound Sterling.
The Company conducts its business in Zimbabwe with a significant portion of
expenditures in that country historically denominated in USD and now also in
RTGS. The introduction of the RTGS$ during the financial year has resulted in
the devaluation of the RTGS$ against the US Dollar. This devaluation has also
resulted in the Zimbabwean economy going into hyperinflationary status. To a
large extent this is beneficial to Premier as its Zimbabwean assets are fully
impaired. The remaining liabilities are inflation adjusted at each reporting
period yielding foreign exchange gains on conversion to USD.
All transactions are subject to spot rates and with no hedging transactions
taking place.
Exposure to currency risk
31 December 2021 31 December 2020
EUR GBP USD ZAR RTGS EUR GBP USD ZAR RTGS
'000 '000 '000 '000 '000 000 '000 '000 '000 '000 '000 000
Trade receivables - - - - - - - - - -
Unsecured loans - - - - - - - - - -
Trade payables - (98) (189) (87) (3 143) (77) (11) (205) (540) (13)
Net statement of financial position exposure - (98) (189) (87) (3 143) (77) (11) (205) (540) (13)
Next 6 months forecast - - - - - - - - - -
sales
Next 6 months forecast purchases (379) (392) (2 391) (3 048) (1 327) - (126) (1 186) - (2 988)
Net forecast transaction exposure (379) (392) (2 391) (3 048) (1 327) - (126) (1 186) - (2 988)
Net exposure (379) (490) (2 580) (3 135) (4 470) (77) (137) (1 391) (540) (3 001)
The summary quantitative data about the Group's exposure to currency risk as
reported to the management of the Group is as follows:
The following significant exchange rates in relation to the reporting currency
are applicable:
Average rate for the year 2021 Year end spot rate
2021 2020 2021 2020
Euro 1.1921 1.1751 1.2281 1.2282
GBP 1.3867 1.335 1.421 1.3577
ZAR 0.0682 0.0699 0.0741 0.0682
RTGS 87.9503 50.4253 108.666 81.787
The carrying amounts of the Group's foreign currency denominated monetary
assets and monetary liabilities at the reporting date are as follows:
Liabilities Assets
2021 2020 2021 2020
'000 '000 '000 '000
Sterling (£) 98 11 - -
Euro (€) - 77 - -
South African Rand (ZAR) 87 540 - -
Real Time Gross Settlement of USD (RTGS) 3 143 12 707 - 429
The presentation currency of the Group is US dollars.
The Group is exposed primarily to movements in USD for trade, RTGS for the
Zimbabwean companies and GBP for all fund raising activities.
Sensitivity analysis
Financial instruments affected by foreign currency risk include financial
investments (see note 9) cash and cash equivalents, other receivables, trade
and other payables and convertible loan notes. The following analysis,
required by IFRS 7 Financial Instruments: Disclosures, is intended to
illustrate the sensitivity of the Group's financial instruments (at year end)
to changes in market variables, being exchange rates.
The following assumptions were made in calculating the sensitivity analysis:
All income statement sensitivities also impact equity
Translation of foreign subsidiaries and operations into the Group's
presentation currency have been excluded from this sensitivity as they have no
monetary effect on the results.
Income Statement / Equity
2021 2020
$ 000 $ 000
Exchange rates:
+10% $ Sterling (GBP) (9) (1)
-10% $ Sterling (GBP) 9 1
+10% $ RTGS (314) (1 253)
-10% $ RTGS 314 1 253
The above sensitivities are calculated with reference to a single moment in
time and will change due to a number of factors including:
· Fluctuating other receivable and trade payable balances
· Fluctuating cash balances
· Changes in currency mix
Interest rate risk
The Group has entered into fixed rate agreements for its finance leases and
shareholders loans. The Group does not hedge its interest rate exposure by
entering into variable interest rate swaps.
Exposure to interest rate risk
The interest rate profile of the Group's interest-bearing financial
instruments as reported to the management of the Group is as per the table
below.
2021 2020
$ 000 $ 000
Fixed rate instruments
Financial assets - -
Financial liabilities - -
- -
Fair value sensitivity analysis for fixed-rate instruments
The Group does not account for any fixed-rate financial assets of financial
liabilities at FVTPL. Therefore, a change in interest rates at the reporting
date would not affect profit or loss.
Other market price risk
The Group is exposed to equity price risk, which arises from equity securities
at FVOCI are held as a long-term investment.
The Group's investments in equity securities comprise small shareholdings in
unlisted companies. The shares are not readily tradable and any monetisation
of the shares is dependent on finding a willing buyer.
Valuation techniques and assumptions applied for the purposes of measuring
fair value
Due to the short term nature, the fair value of cash and receivables and
liabilities approximates the carrying values disclosed in the financial
statements.
The fair value of financial assets is estimated by using other readily
available information. As the Circum and MNH shares are in privately held
exploration companies, the fair values were estimated using observable placing
prices where available.
Circum and MNH are unlisted and there are no quoted market prices. The fair
value of the Circum shares was derived using the previous issue price and
validating it against the most recent placing price on 11 May 2021. The fair
value of MNH shares was derived from the latest placing and supported by an
external valuation conducted by Bara Consulting.
Capital management
The Group manages its capital resources to ensure that entities in the Group
will be able to continue as a going concern, while maximising shareholder
return.
The capital structure of the Group consists of equity attributable to
shareholders, comprising issued share capital and reserves. The availability
of new capital will depend on many factors including a positive mineral
exploration environment, positive stock market conditions, the Group's track
record, and the experience of management. There are no externally imposed
capital requirements. The Directors are confident that adequate cash
resources exist or will be made available to finance operations but controls
over expenditure are carefully managed.
31. Subsidiaries
Premier had investments in the following subsidiary undertakings as at 31
December 2021, which principally affected the losses and net assets of the
Group:
31.1 Subsidiaries held during the year
Country of incorporation and operation Proportion of voting interest %
Name
Activity
2021 2020
Zulu Lithium Mauritius Holdings Limited Mauritius 100 100 Holding Company
RHA Tungsten Mauritius Limited Mauritius 100 100 Holding Company
Kavira Minerals Holdings Limited Mauritius 100 100 Holding Company
Tinde Fluorspar Holdings Limited Mauritius 100 100 Holding Company
Lubimbi Minerals Holdings Limited Mauritius 100 100 Holding Company
Gwaaii River Minerals Limited Mauritius 100 100 Holding Company
Zulu Lithium (Private) Limited Zimbabwe 100 100 Exploration
RHA Tungsten (Private) Limited Zimbabwe 49* 49* Care and maintenance
Katete Mining (Private) Limited Zimbabwe 100 100 Exploration
Tinde Fluorspar (Private) Limited Zimbabwe 100 100 Exploration
LM Minerals (Private) Limited Zimbabwe 100 100 Exploration
BM Mining & Exploration (Private) Limited Zimbabwe 100 100 Exploration
Licomex (Pty) Ltd Zimbabwe 100 100 Exploration
Li3 Mozambique (Pty) Ltd Australia 100 100 Holding Companies
Li3B Mozambique (Pty) Ltd Australia 100 100 Holding Companies
Li3C Mozambique (Pty) Ltd Australia 100 100 Holding Companies
Lithium B S.A. Mozambique 100 100 Exploration
* Accounted as a controlled subsidiary, refer note 4 - Significant accounting
policies, estimates and assumptions and note 4.7 - Basis of consolidation.
31.2 Acquisition of subsidiaries
During the year ended 31 December 2020 the Group acquired 100% of the
following companies:
Company Name Number of shares purchased Purchase Consideration Country of Incorporation Main Activity
LiComex (Pty) Ltd, 100 $99,864 Zimbabwe Exploration
Li3 Mozambique (Pty) Ltd 10,000 $6,634 Australia Holding company - Owning 33.33% of Lithium B S.A.
Li3B (Mozambique) (Pty) Ltd 10,000 $6,633 Australia Holding company - Owning 33.33% of Lithium B S.A.
Li3C (Mozambique) (Pty) Ltd 10,000 $6,633 Australia Holding company - Owning 33.33% of Lithium B S.A.
Lithium B S.A. 30,000 $nil Mozambique Exploration
$119,764
Total purchase consideration
32. Related party transactions
Ultimate controlling party
There is no single ultimate controlling party.
Transactions with key management personnel
Loans from directors
During 2020 all loans to directors were settled by the issue of shares. The
amount outstanding at year end is nil (2020: nil). Refer to note 18 for
detailed information.
Supplies and Services
During 2021, administration fees of $0.114 (2020: $0.114 million) were paid by
Premier to a trading business in which George Roach, Director, is the
beneficial owner. Administration fees comprised allocated rental costs and
administrative support services. At the financial year-end the amount
outstanding is nil (2020: nil).
The amount outstanding at 31 December 2021 for Brendan Roach for directors
fees of RHA is nil (2020 : nil).
The amount outstanding at 31 December 2021 for Godfrey Manhambara for
directors fees of is $0.092 (2020: nil).
The amount outstanding at 31 December 2021 for Wolfgang Hampel for directors
fees of is $0.011 million (2020 - $0.002 million).
The amount outstanding at 31 December 2021 for Neil Herbert for directors fees
of is nil (2020: nil).
Borrowings
In April 2018 Brendan Roach loaned the company GBP 0.084 million. The
outstanding loan balance as at 31 December 2019 is $0.128 million. During 2020
the loan was settled by the issue of shares. The amount outstanding at year
end is nil. Refer to note 18 for detailed information.
During the financial year, Neil Herbert advanced $0.180 million to Premier
African Minerals to facilitate an additional loan to MN Holdings.
Remuneration of key management personnel
The remuneration of the Directors and other key management personnel of the
Group are set out below for each of the categories specified in IAS 24 Related
Party Disclosures.
2021 2020
$ 000 $ 000
Consulting Fees (Note 28) 381 273
Staff costs 114 160
Directors' fees (Note 28) 118 35
613 468
33. Events after the reporting date
33.1 Corporate matters
On the 10 January 2022, Premier appointed of Mr. Errico Vascotto as a
non-board Chief Operating Officer.
During February 2022, the Company accepted a share offer by Vortex Limited
("Vortex") for the exchange of Premier's entire 4.8% interest in Circum
Minerals Limited ("Circum") for 5,010,333 new shares in the capital of Vortex
representing an interest of approximately 13.1% of the enlarged share capital
of Vortex. As part this transaction, Vortex agreed to provide Premier with
observer rights to its day-to-day operations, including without limitation,
access to any information updates from Circum. Premier will also have certain
pre-emptive rights to ensure that Premier is able to protect and maintain its
interest in Vortex.
In March 2022, Premier concluded a direct subscription with Suzhou TA&A
Ultra Clean Technology Co., Ltd ("Suzhou TA&A") to raise £12 million
before expenses at an issue price of 0.4 pence per new ordinary share for the
ongoing DFS at Premier's Zulu Lithium and Tantalum Project ("Transaction"). In
accordance with this Transaction, Suzhou TA&A were also award the
following:
i. exclusive offtake rights on commercial terms to
the marketing and sale of 50 per cent of all spodumene produced at Zulu
("Offtake Rights");
ii. an irrevocable right of first refusal for 180 days
from the date of the Subscription to match any further equity or loan related
funding that is contemplated by Premier, in particular any deal relating to
Zulu, on terms no worse than those offered by another potential investor;
iii. A right of participation in any future funding so
as to maintain Suzhou TA&A's shareholding of 13.38 per cent in Premier at
all times; and
iv. A right to appoint one director to serve on the
boards of Premier, Zulu Lithium Mauritius Limited, and Zulu Lithium (Private)
Limited ("Board Appointment"). To this extent, Dr Luo Wei was appointed as
Non-Executive Director of the Company on the 14 April 2022.
In April 2022, Premier entered into a binding Joint Venture Agreement ("JV
Agreement") with Li3 Resources Inc. ("Li3 Resources") whereby Li3 Resources
will acquire a 50% interest in Premier's hard-rock lithium assets located in
the Mutare Greenstone Belt in Zimbabwe. This JV Agreement facilitates is
intended to facilitate exploration activities that are funded independently of
Premier's. To date, Premier is yet to receive the funding, however Li3
Resources has until 31 December 2022 to acquire the 50% interest in the Li3
Project by spending US$250,000 in further exploration works.
On the 27 April 2022, Neil Herbert elected to resign from the board of
Premier to pursue his other business interests including his recent
appointment as executive Chairman of Atlantic Lithium. George Roach agreed to
act as the interim Chairman for a limited period.
In May 2022, the Company awarded 1,127,500,000 share options to both directors
and management ("Options"). Options for up to 317,500,000 ordinary shares of
no-par value in the Company (the "Director Options") were awarded to
Directors. In addition, the Company has also issued a further 810,000,000
options to a non-board members and management on similar terms ("Management
Options").
In June, the Company entered into a binding heads of terms with Suzhou
TA&A to provide a pre-funding amount US$34,644,385 to enable the
construction and commissioning of a large-scale pilot plant at the Zulu
Lithium Project.
34 Ultimate Controlling Company
There is no single ultimate controlling company for Premier.
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