REG - Rockfire Resources - Annual Results for the year ended 31 December 2022
06/06/2023 13:01
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230606:nRSF8371Ba&default-theme=true
RNS Number : 8371B Rockfire Resources PLC 06 June 2023
The information contained within this announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.
6 June 2023
Rockfire Resources plc
("Rockfire" or the "Company")
Annual Results for the year ended 31 December 2022
Rockfire Resources plc (LON: ROCK), the base metal, gold and critical mineral
exploration company, announces its audited results for the year ended 31
December 2022.
For further information on the Company, please
visit www.rockfireresources.com (http://www.rockfireresources.com/) or
contact the following:
Rockfire Resources plc: info@rockfire.co.uk (mailto:info@rockfire.co.uk)
David Price, Chief Executive Officer
Allenby Capital Limited (Nominated Adviser & Broker): Tel: +44 (0) 20 3328 5656
John Depasquale / George Payne (Corporate Finance)
Matt Butlin / Kelly Gardner (Sales and Corporate Broking)
Notes to Editors
Rockfire Resources plc (LON: ROCK) is a gold, base metal and critical mineral
exploration company, with a portfolio of gold/copper/silver projects in
Queensland Australia and a high-grade zinc/lead/silver/germanium deposit in
Greece.
§ The Molaoi deposit in Greece has a JORC resource of 210,000 tonnes of zinc,
39,000 tonnes of lead and 3.5 million ounces of silver, using a 4% Zn cut off.
§ The Plateau deposit in Queensland has a JORC resource of 131,000 ounces of
gold and 800,000 ounces of silver, using a 0.5g/t Au cut off. 53,000 of these
ounces lie within the top 100m from surface.
§ The Copperhead deposit in Queensland has a JORC resource of 80,000 tonnes
of copper, 9,400 tonnes of molybdenum and 1.1 million ounces of silver, using
a 0.13% CuEq. cut off.
CHAIRMAN'S STATEMENT
Rockfire has had a remarkable year of outstanding achievement. The Company
has, in a very short space of time, delivered a JORC gold resource, a JORC
silver resource, a JORC copper resource and now a JORC zinc/lead resource into
its portfolio. This has resulted in creating diverse material value across the
Company's project base.
Rockfire is in an enviable position of having accumulated JORC resources of:
· 130,000 ounces of gold and 800,000 ounces of silver at Plateau;
· 120,000 tonnes of copper equivalent at Copperhead (comprising
80,000 tonnes of copper, 9,000 tonnes of molybdenum and 1.1 million ounces of
silver); and
· 250,000 tonnes of zinc equivalent at Molaoi in Greece (comprising
210,000 tonnes of zinc, 39,000 tonnes of lead, and 3.5 million ounces of
silver).
2022 saw the Company focus its financial and human resources on the Molaoi
zinc/lead/silver deposit in Greece. This decision was made owing to the very
high grades attained at Molaoi in historical drilling. In addition to this,
Molaoi benefits from vast amounts of historical exploration expenditure, which
resulted in the drilling of 173 diamond holes, two rounds of metallurgical
test work, a financial and technical feasibility study as well as the
development of a portal and decline to the orebody. Molaoi represents a very
advanced project and Rockfire is aiming to achieve underground production
within the next 3 years.
As we strive to complete our confirmatory and in-fill drilling during the next
12-month period, our team is preparing for environmental and feasibility
studies which we hope to commence towards the end of the next financial
period.
I would like to congratulate our excellent teams in Greece and Australia who
have worked tirelessly during the year to complete so many milestones. These
include:
• Winning the tender for Molaoi
• Achieving a Maiden JORC resource at Copperhead
(64 MT @ 0.19 % CuEq (120,000 tonnes of CuEq.)
• Reanalysing the old drill core at Molaoi
• Discovering germanium at Molaoi
• Achieving a Maiden JORC at Molaoi (2.3 MT @ 11
% ZnEq. for 250,000 tonnes of ZnEq.)
• Hosting a technical site visit by the
Company's nominated advisor and broker, Allenby Capital
• Completing the submission of an Environmental
Study
• Applying for, and being accepted into ERMA
(European Raw Materials Alliance)
• Identifying all landowners and completing
initial consultations at Molaoi
• Commencing our field-based exploration
activity at Molaoi
• Achieving excellent recoveries of zinc (89%)
and lead (74%) from metallurgical tests
• Achieving commercially saleable grades of zinc
(57% Zn), silver (856 g/t Ag), lead (63.6% Pb) germanium (117 g/t
Ge), copper (2.62% Cu) and gold (0.52 g/t Au) at Molaoi
• Completing the lease of a 10Ha parcel of land
on top of the Molaoi resource
• Successfully changing the sole trading
Hellenic Minerals IKE to a publicly unlisted Hellenic Minerals SA company
structure after the acquisition by Rockfire
• Providing 4 x defibrillators to each of the
public schools in Molaoi as part of the Company's Health, Safety and
Environment plan
• Smooth and on-time commencement of diamond
drilling at Molaoi
• Location and excavation of the old portal site
• Locating and sampling very high zinc, lead and
silver grades from old shafts and outcrop
• Successfully encountering massive sulphides in
the first geotechnical drill hole at Molaoi at the predicted position
• Signing a lease over a parcel of land suitable
for core processing/site office/equipment storage
I proudly present to you, the Annual Report for Rockfire Resources for the
financial year ended 31 December 2022 and look forward to a very successful
2023 for all our shareholders.
Administration
The Company returned to in-person and hybrid meetings, including board
meetings and presentations to investors during the year. The Company held its
Annual General Meeting as a hybrid virtual/gathered meeting. Owing to
geographical diversity, all board meetings throughout the year were held
remotely, with directors meeting at least once a month (and often more
regularly) throughout the year.
Financial review
The consolidated statement of comprehensive income for the year shows a loss
of £614,329 (2021: loss £907,783).
Rockfire is very proud that it was able to restrict its raising of exploration
funds to only one fundraise during the calendar year and still achieve so much
exploration success.
On 17 October 2022, the Company announced that it had successfully completed a
subscription of new ordinary shares in the Company, raising gross proceeds of
£375,000. This subscription was through the Company's sole broker, Allenby
Capital Limited, and comprised 240,000,000 new ordinary shares of 0.1 pence
each in the Company being placed with an institutional investor, at an issue
price of 0.125 pence per share.
In addition, certain Rockfire employees including several Directors subscribed
for an aggregate of 60,000,000 new ordinary shares at the same issue price. In
total, 300,000,000 new ordinary shares were issued pursuant to the
subscription.
The total issue represented approximately 20.87 per cent. of the enlarged
issued share capital of the Company at the time.
On 1 June 2023, the Company announced that it had successfully raised
£880,000, before expenses, through Paloma Precious DMCC subscribing for
400,000,000 new ordinary shares of 0.1 pence each at a price of 0.22 pence per
share, representing approximately 21.7 per cent. of the issued share capital
of the Company as enlarged by the subscription.
Exploration review
Molaoi, Greece
Rockfire's exploration activities for 2022 started very positively with an
announcement on 8 March that it had won an Open International Tender for the
exploration and exploitation rights to the high-grade Molaoi zinc deposit in
Greece. Winning the tender provided Rockfire with 100% ownership of a 30-year
licence to explore and mine the Molaoi deposit, located in the Peloponnese
region of Greece. Molaoi is an outstanding high-grade zinc deposit, and Greece
offers a low-risk jurisdiction with a modern mining legislation and an active
and progressive mining industry making it an attractive destination for the
Company.
Successfully verifying the high grades reported by previous explorers
provided a big step towards de-risking the project and provided enormous
encouragement for the team to move forward rapidly with resource expansion
plans.
The Molaoi project took an unexpected but very positive turn when it was
announced to the market on 10 May 2022 that re-analysis of the historical
drill core had discovered the presence of one of the world's critical metals,
germanium. Critical metals are metals deemed vital for world economies to
continue to provide technology. The supply of germanium is largely at risk due
to geological scarcity. The European Union Environmental Agency includes
germanium in the top 20 raw materials which have been identified by the
European Commission as being critical metals owing to risk of supply
shortages.
The team successfully delivered a maiden inferred mineral resource estimate
for Molaoi in May 2022. The mineral resource surpassed all expectations and
demonstrated the quality and potential of the project. The inaugural JORC
resource estimation for Molaoi delivered an inferred mineral resource of 2.3
million tonnes @ 11 % ZnEq. for 250,000 tonnes of ZnEq. Using a 4% low-grade
cut, individual elemental grades are 9.4 % Zn, 1.7 % Pb and 47 g/t Ag. This
resulted in 210,000 tonnes of zinc, 39,000 tonnes of lead and 3.5 million
ounces of silver being included in the maiden resource.
Importantly, only 1,400 m of a potential strike extent of 7 km has been
included in the resource and the resource remains open at depth and along
strike. In addition to this, multiple parallel mineralised lodes are not
included in the resource and are yet to be fully tested. The presence of
parallel lodes may add materially to the resource in future estimates.
Results of metallurgical tests commissioned by Rockfire report excellent
recoveries of zinc (89%) and lead (74%). Commercially saleable grades of zinc
(57% Zn), silver (856 g/t Ag), lead (63.6% Pb), germanium (117 g/t Ge), copper
(2.62% Cu) and gold (0.52 g/t Au) are readily achieved at Molaoi.
Rockfire was delighted to announce in November 2022 that geotechnical drilling
was underway in Greece. An initial 4 holes (for a total of 840m) are planned
to be drilled within the main mineral resource of 2.3Mt @ 11% zinc equivalent.
These initial 4 geotechnical holes are expected to be followed by more holes
to gather geotechnical information throughout the 1.5km of the resource and
beyond. The average depth of drilling is 210m with the deepest hole planned to
reach 270m below surface.
Both massive and semi-massive sulphides were encountered in Rockfire's first
drill hole at a depth and position predicted from historical drill data.
Between 1979 and 1988, 173 diamond drill holes were drilled at Molaoi, as well
as metallurgical tests, a feasibility study and the development of a portal
and decline to the orebody. The Company's exploration and exploitation permit
allows Rockfire to capitalise on this excellent work by the Greek Government
to help monetise the project in a timely manner.
Management considers Molaoi to be an outstanding base metal project, which we
hope will grow to a globally significant scale. The quality of the grades and
quantity over the first 1,400 m strike extent is testimony to the potential
size of Molaoi, particularly if our planned exploration along strike proves to
be successful.
Lighthouse, Queensland
The Lighthouse tenement includes the Plateau gold deposit, where an Inferred
JORC resource has been drilled by Rockfire of 3.9 million tonnes @ 1.1 g/t Au
and 6.4 g/t Ag (0.5g/t cut-off), for 131,302 ounces of gold and 800,000 ounces
of silver. The tenement also comprises the Cardigan Dam, Split Rock and Double
Event prospects.
The Company completed soil and rock sampling during the year. A total of 557
soil samples were collected from four sites within the Lighthouse tenement and
results of this work returned strongly elevated gold results. Rockfire's
management believes that the soil anomaly may present a target, based on
high-grade gold-in-rock samples as well. Ongoing mapping and rock sampling at
Plateau identified multiple new targets close to the drilled JORC gold
resource. Seventeen (17) rock samples were collected, with results including
10.7 g/t Au, 3.2 g/t Au and 2.3 g/t Au.
The new targets combined could add material ounces to the already-defined gold
resources.
Copperhead, Queensland
At the start of the reporting period, Rockfire had recently completed a
diamond drilling programme and an update to the market was provided on 20
January 2022. This update included assay results for the third diamond drill
hole (BCH003), which returned 370 m @ 0.20 % CuEq. from 57 m. Hole BCH003
significantly expanded copper mineralisation by 100 m directly east of hole
BCH001 and 200 m north of hole BCH002, resulting in another significant
increase in the footprint of the drilled copper-bearing area.
Based on drilling 5 deep diamond holes at Copperhead, Rockfire announced a
maiden inferred JORC mineral resource of 64 million tonnes @ 0.19% CuEq. for
120,000 tonnes of copper equivalent on 21 March 2022.
The mineral resource remains open to the north, east, west and at depth,
leaving scope for significant, further resource increases. With continued
exploration success and expansion of the resource, Copperhead demonstrates
potential to form a low-cost, bulk-tonnage, open cut mining scenario.
Copper Dome
A three-dimensional interpretation of an airborne helicopter-supported
magnetic survey had been commissioned at the end of the previous reporting
period to determine the characteristics of the magnetic response at depth.
This 3D interpretation highlighted two large, strongly magnetic bodies lying
approximately 500m below the surface. These bodies were both characterised by
long intervals of low-grade copper and gold immediately above them, which had
been discovered in historical RC drilling.
Copper Dome remains a highly prospective porphyry copper/gold target for
Rockfire but no further work was completed during the 2022 calendar year.
Material events and reviews since the end of 2022
Lighthouse, Queensland
Rockfire announced on 20 January 2023 that the Company has entered into a new
joint venture ("JV") at the Plateau gold deposit in Queensland, Australia. The
purpose of the JV will be to test regional targets, as well as the discovery
of higher-grade gold, close to Rockfire's JORC resource.
· Rockfire has entered into a binding heads of agreement with
Sunshine Gold Limited ("Sunshine") to advance the Plateau gold deposit.
Sunshine is listed on the Australian Stock Exchange (ASX:SHN)
· The JV includes the Lighthouse tenement (EPM25617) and the
adjoining Kookaburra tenement (EPM26705) (together the "Tenements")
· The JV will result in Sunshine sole-funding exploration at
Plateau for the next 3 years, with funding being engaged on direct exploration
activity
· Rockfire intends to focus its financial, logistical and human
resources on the Molaoi zinc deposit in Greece, which hosts an Inferred,
high-grade JORC resource of 2.3 million tonnes @ 9.4% zinc, 1.7% lead and
47g/t silver for 250,000 tonnes of zinc equivalent. The critical mineral,
Germanium has also been discovered, associated with zinc
· The Plateau gold deposit has a quoted Inferred JORC resource of
3.9 million tonnes @ 1.1g/t gold and 6.4g/t silver, using a 0.5g/t Au cut off
· Sunshine will target potential for additional ounces in the top
100m from surface, where the JORC resource is quoted as Indicated and Inferred
1.4 million tonnes @ 1.2g/t Au and 8.8g/t Ag, (using a 0.5g/t Au cut off), for
a total of 53,336 ounces of gold
· Regional targets within the Lighthouse tenement, including Double
Event, Cardigan Dam, Bluff Creek, Bullseye, Rollston River, Warrawee, Lower
Lighthouse and Horse Creek will also be a focus for Sunshine to delineate
near-surface resources at each of these regional prospects
· Rockfire has the option to retain 25% ownership of the Plateau
gold project by participating in 25% expenditure in on-going exploration, or
the Company may elect to convert its right over a 25% share of the Tenements
to a 1.5% net smelter royalty. With this structure, any discovery success by
Sunshine will directly benefit shareholders of Rockfire
The establishment of this joint venture is a positive step for the Plateau
project and for Rockfire generally. The JV enables our team to focus its
efforts on the Molaoi project in Greece and allows for the advancement of
Plateau at the same time. The joint venture structure is designed so that
Sunshine will sole-fund exploration costs on the project with minimum
allowance for administration costs.
Sunshine is an excellent JV partner with a proven track record of thorough and
sustained drilling. The Sunshine team is experienced and dedicated to
discovery and Rockfire's management believes that Plateau is in good hands
with Sunshine as a quality partner.
· The JV includes the Lighthouse project exploration permit
EPM25617 and the adjoining Kookaburra exploration permit EPM26705 in
Queensland
· As at 30 June 2022, the Company's last announced financial
statements, the Tenements accounted for £1,569,459 of the Company's
intangible assets. As all expenditure on the Tenements is capitalised, there
were no losses or profits attributed to the Tenements
· During the sole funding period, Sunshine must keep the Tenements
in good order and meet all statutory reporting, rehabilitation, and
expenditure obligations
· On the occurrence of each milestone set out in the table below,
Sunshine will acquire the corresponding participating Interest in the
Tenements
Until the point that Sunshine reaches the stage 1 milestone, Sunshine will
have no participating interest in the Tenements.
Stage Milestone Total participating interest earned by Sunshine at end of stage Time frame
1 Sunshine has sole funded AUD $600,000 in expenditure 40% Maximum of 1 Year from execution date
2 Sunshine has sole funded a further AUD $600,000 51% Maximum of 2 years from execution date
in expenditure
3 Sunshine has sole funded a further AUD $1,000,000 75% Maximum of 3 years from execution date
in expenditure
The expenditure requirement for each stage 1, 2 and 3 is independent of the
other stages and not cumulative.
At the conclusion of stage 3, Rockfire has 60 days from receipt of all data
and reports and proposed program and budget, by written notice to elect to
either contribute its 25% share of on-going exploration and development
expenditure or convert its 25% share to a 1.5% net smelter royalty.
The terms of the net smelter royalty are to be based on the standard Energy
& Resources Law Association (formerly AMPLA Ltd) template.
Molaoi, Greece
On 23 January 2023, Rockfire announced that results from the Company's
geotechnical drilling programme at the Molaoi zinc deposit in Greece include
multiple, high-grade intersections which demonstrates the quality of the
Molaoi deposit. Confirmation of multiple lodes provides an opportunity to
significantly increase tonnage and will potentially have a considerable
positive impact on the future economics of the project.
MO_GTK_001 was drilled halfway between historical drill holes to provide
sufficient sample for geotechnical test work. Historical drilling encountered
several possible parallel lodes and MO_GTK_001 confirms that Molaoi comprises
multiple lodes and perhaps as many as four stacked, high-grade lodes.
Main Lode
13.4% ZnEq. over 7.18m width, from 130.62m (11.3% Zn, 1.4% Pb and 50g/t Ag).
Second Lode
15.6% ZnEq. over 0.17m width, from 142.60m (14.3% Zn, 0.5% Pb and 41.80g/t Ag)
Third Lode
10.7% ZnEq. over 1.73m width, from 144.90m (8.3% Zn, 1.3% Pb and 62g/t Ag)
Fourth Lode
19.5% ZnEq. over 2.24 m width, from 161.10m (16.6% Zn, 3.1% Pb and 36g/t Ag)
Overall the main, second and third lodes comprise a broad mineralised zone
with an intersection of 7.5% ZnEq. over 16m width from 130.62m (6.2% Zn, 0.8%
Pb and 31 g/t Ag).
The highest individual samples are 20.5% Zn and 93.4g/t Ag over 1.25m (from
132.15m depth) and 4.1% Pb over 1.0m (from 161.10m).
Core samples from the mineralised lodes will contribute towards a compilation
sample to commence crushing and grinding work index studies.
Assay results of this magnitude and width provide management with
ever-increasing confidence that we can proceed rapidly towards a resource
upgrade and commence feasibility studies before the end of the 2023 calendar
year.
Share subscription
As mentioned above, on 1 June 2023, the Company announced that it had raised
£880,000, before expenses, through a subscription of 400,000,000 new ordinary
shares.
We wish to thank all our shareholders for their continuing support as we build
further value in our projects. With gold, silver, copper, molybdenum, zinc and
lead JORC resources, Rockfire is in an enviable position to capitalise on this
time of increasing commodity demand and rising prices.
Gordon Hart
Chairman
6 June 2023
DIRECTORS' BIOGRAPHIES
Gordon Hart, Chairman
Gordon has over 35 years of experience in the equity capital and financial
advisory markets. He spent 12 years from 2004 to 2016 as Managing Director of
Venture Group Equities Pty. Ltd, where he advised on transactions involving
over US$300 million of funding. He is a graduate of the Australian Institute
of Company Directors and has a Graduate Diploma in Corporate Governance.
Gordon brings a wealth of corporate knowledge, equities and finance expertise
and emerging company experience to Rockfire.
David Price, Chief Executive Officer and Managing Director
David is an experienced geologist and senior executive with over 30 years of
experience in the global mining industry and over 20 years' experience in
securing funding for exploration projects. David is a Fellow of the
Australasian Institute of Mining and Metallurgy (FAusIMM) and is a Competent
Person for Mineral Exploration under the guidelines of the JORC Code.
During his career, David has been involved with many resource projects. He was
Country Manager for Danae Resources during the drill-out and Pre-Approval
Study of the Sappes gold project in Greece. He was the Senior Consulting
Geologist during the drill-out of Australia's second-largest lithium resource
at Earl Grey in Australia.
David has previously held senior roles in both listed and private resource
companies, including CEO of Golden Tiger Mining Limited, CEO of Convergent
Minerals Limited and Managing Director of Millennium Mining Limited.
Ian Staunton, Non-executive Director
Ian has worked in the City of London for more than 40 years in a range of
role, including Audit Partner, Corporate Finance Partner and Equity Partner in
various accounting firms. He is a retired Fellow of the Institute of
Chartered Accountants in England and Wales and has a Diploma in Corporate
Finance. Having worked as Equity Partner and Head of Capital Markets for
Chantrey Vellacott DFK LLP and a Senior Equity Partner for Moore Stephens
during the last 25 years, Ian provides Rockfire with a strong level of
accounting and audit experience. Such high-level accounting, audit and
compliance capability fulfils Rockfire's ambition to broaden its corporate
skill base and to bring unparalleled experience and expertise from London onto
the board. Ian is the Chairman of the Audit Committee.
Patrick Elliott, Non-executive Director
Pat is an experienced resources and industrial company director. In a career
spanning over 45 years, he has held senior executive positions with
Consolidated Gold Fields (Australia) Limited and Morgan Grenfell Australia
Limited. Pat has an MBA in Mineral Economics from Macquarie University and a B
Comm from the University of New South Wales. He has extensive management
experience in various fields, including manufacturing, mineral exploration,
and oil and gas exploration. Pat is currently Executive Chairman of Cap-XX
Limited and Chairman of Argonaut Resources NL (an ASX-listed copper explorer).
He is also a Non-Executive Director of Tamboran Resources Limited and
Kirrama Resources Limited (an unlisted explorer and developer of chromite and
manganese projects in Madagascar).
Nicholas Walley, Non-executive Director
Nicholas has a business background spanning multiple industries, including
agriculture, property, construction, plant hire, food and beverage packaging,
leisure and charitable work. He has critical skills in logistics,
infrastructure, organisational management and sales.
STRATEGIC REPORT
Molaoi Zinc Project, Greece
Rockfire's exploration activities for 2022 started very positively with an
announcement on 8 March 2022 that it had won an Open International Tender for
the exploration and exploitation rights to the high-grade Molaoi zinc deposit
in Greece. Winning the tender provided Rockfire with 100% ownership of a
30-year licence to explore and mine the Molaoi project, located in the
Peloponnese region of Greece. Molaoi is an outstanding high-grade zinc
deposit, and Greece offers a low-risk jurisdiction with a modern mining
legislation and an active and progressive mining industry making it an
attractive destination for the Company.
The Greek State drilled 173 cored diamond holes between 1979 and 1988, largely
concentrated in a strike length of 1.5 km long. Multiple, stacked,
zinc-bearing layers have been mapped over a total strike length of 7 km,
providing enormous upside for additional expansion of zinc mineralisation.
Some of the outstanding results from historical drilling at Molaoi include:
· 10.4 m @ 10.63 % Zn, 1.45% Pb, & 62 g/t Ag (AN011, from 79 m)
· 15.0 m @ 11.94 % Zn, 1.96% Pb, & 66 g/t Ag (AN017, from 136
m)
· 7.0 m @ 14.96 % Zn, 2.13% Pb, & 63 g/t Ag (AN028, from 187 m)
· 7.0 m @ 19.17 % Zn, 2.89% Pb, & 76 g/t Ag (B010, from 43 m)
· 9.9 m @ 18.06 % Zn, 2.87% Pb, & 91 g/t Ag (B011, from 184 m)
· 2.8 m @ 26.51 % Zn, 1.87% Pb, & 80 g/t Ag (BG013, from 57 m)
Zinc mineralisation starts at surface and has been extensively drilled down to
approximately 220 m, where 5.15 m @ 10.8% Zn, 3.8% Pb, & 37g/t Ag was
encountered. Mineralisation remains open at depth.
On 11 April 2022, the Company announced that the historical drill core had
been located, photographed, and sampled as part of the Company's technical due
diligence of the Molaoi deposit. The core has been stored under cover by the
Greek Government and the original sampling intervals have been kept wrapped in
plastic. This meant that we have been able to sample the precise interval as
that selected in the 1980's. A total of 51 samples of the old core were taken
to verify a spread of original assays ranging from 0.9% Zn to a maximum of
36.75% Zn. The samples collected for re-assay were specifically selected to
represent a spatial spread to include the entire 1.5 km distance, where most
of the historical drilling occurred.
The results of the core re-analysis were announced on 3 May 2022 and
demonstrated that the core has successfully verified the high grades reported
by previous explorers, with zinc, lead and silver values closely replicating
historical analysis. This verification provided a big step towards de-risking
the project and provided enormous encouragement for the team to move forward
rapidly with resource expansion plans.
The highest individual assay returned was 0.5 m @ 34.1 % Zn, 12.9 % Pb and 474
g/t Ag. Not all the core was sampled and this individual sample is within a
broader zone which was not resampled but grades 3 m @ 13.0 % Zn, 4.6 % Pb and
159.8 g/t Ag feature in historical analysis.
The verification process formed part of Rockfire's technical Quality
Assurance/Quality Control (QA/QC) which is an important aspect of achieving an
inaugural JORC resource estimate. Verification assays of this magnitude and
accuracy confirm the significance of the Molaoi project and contribute to
overall de-risking of the project.
The Molaoi project took an unexpected but very positive turn when it was
announced to the market on 10 May 2022 that re-analysis of the historical
drill core had discovered the presence of one of the world's critical metals,
germanium, at Molaoi.
Critical metals are metals deemed vital for world economies to continue to
provide technology. The supply of germanium is largely at risk due to
geological scarcity. The European Union Environmental Agency includes
germanium in the top 20 raw materials which have been identified by the
European Commission as being critical metals, owing to risk of supply
shortages.
The weighted average grade of the 51 samples collected during the re-analysis
of core is 51 grams per tonne (g/t) Ge, with a peak value of 197 g/t Ge. 41%
of samples returned germanium values above 50 g/t Ge.
Germanium is used in the manufacture of everyday technology including mobile
phones, electronics, solar cells, camera lenses, satellites, computer screens,
as well as steering and parking sensors for vehicles. Germanium is also used
in numerous military applications including weapons-sighters (scopes) and
infrared night vision.
A maiden inferred mineral resource estimate for Molaoi was announced on 23 May
2022. The mineral resource surpassed all expectations and demonstrated the
quality and potential of the project. The resource is reported in accordance
with the Joint Ore Reserve Committee ("JORC") Australasian Code (2012) for
Reporting of Exploration Results, Mineral Resources and Ore Reserves.
The inaugural JORC resource estimation for Molaoi delivered an inferred
mineral resource of 2.3 million tonnes @ 11 % ZnEq. for 250,000 tonnes of
ZnEq. Using a 4% low-grade cut, individual elemental grades are 9.4 % Zn, 1.7
% Pb and 47 g/t Ag. This results in 210,000 tonnes of zinc, 39,000 tonnes of
lead, and 3.5 million ounces of silver being included in the maiden resource.
Only 1,400 m of a potential strike extent of 7 km has been included in the
resource and the resource remains open at depth and along strike. In addition
to this, multiple, parallel mineralised lodes are not included in the
resource, and are yet to be fully tested. The presence of parallel lodes may
add materially to the resource in future estimates.
Metallurgical flotation test work completed in 1984 resulted in 96% zinc
recovery, 92% lead recovery and 91% silver recovery into a bulk concentrate.
These recovery factors were applied to the mineral resource to calculate the
resulting zinc equivalent tonnes and grade.
The top 40 m from surface were excluded from the mineral resource as Rockfire
is planning underground mining only to minimise social and environmental
impacts. Germanium was not included in the maiden resource estimate owing to
limited quantitative analysis.
Management considers Molaoi to be an outstanding base metal project, which we
hope will grow to a globally significant scale. The quality of the grades and
quantity over the first 1,400 m strike extent is testimony to the potential
size of Molaoi, particularly if our planned exploration along strike proves to
be successful.
Geological mapping and rock sampling throughout the Molaoi licence commenced
on 17 August 2022, with an announcement on the same day detailing the initial
work. Diamond drilling was being planned to target the expansion of the maiden
JORC resource.
A Greek exploration geologist and a local mining engineer were appointed in
late July 2022 to conduct exploration activities and prepare for drilling. A
lease was signed for the Company to lease a core yard and field operations
office, both located on the exploration licence and close to the planned
drilling at Molaoi. Further, as part of the grant of the tender to Rockfire, a
lease of a 10-acre (4.06 Ha) parcel of surface land at Molaoi was granted to
the Company. The private lease transferred to Rockfire includes the portal and
decline to the historical underground mine, developed during the late 1980s.
On 25 August 2022, Rockfire announced that preliminary metallurgical tests
from Molaoi have returned excellent recoveries and concentrate grades for
zinc, silver, lead and germanium. Copper and gold have also reported to the
concentrates, adding high potential value to the future economics of the
project. The metallurgical recoveries and grades attained in this round of
tests significantly reduce process recovery and marketing risk. Metallurgical
test work is being supervised by the Company's metallurgical consultants, BHM
Process Consultants Pty. Ltd. ("BHM") in Perth, Western Australia, using core
drilled by the Greek Government.
Results of the metallurgical tests report excellent recoveries of zinc (89%)
and lead (74%). Commercially saleable grades of zinc (57% Zn), silver (856 g/t
Ag), lead (63.6% Pb), germanium (117 g/t Ge), copper (2.62% Cu) and gold (0.52
g/t Au) are readily achieved at Molaoi. Two flotation circuit tests were
conducted, with zinc/germanium (Concentrate 1) and lead/silver/copper/gold
(Concentrate 2).
First-pass metallurgical recovery of zinc is 89%, with this figure likely to
increase with more detailed tests. The performance of the zinc system is
reported by BHM as "excellent", with a product grade of 57% Zn concentrate
achieved in a single pass through a 3-stage flotation circuit. This is well
above the desired product grade of 50% Zn contained for a saleable
concentrate.
Germanium reports to the zinc concentrate with a commercially competitive
grade of 117 g/t Ge and is expected to be recovered as part of the zinc
concentrate. This is expected to be a valuable credit in the concentrate.
First-pass metallurgical recovery of lead is 74%, with this figure also
expected to increase with more detailed test work. The lead circuit recovery
is at a greatly over-concentrated value of 63.6% Pb concentrate achieved in a
single pass through a 3-stage circuit configuration. This also far exceeds the
market requirement of 40% - 50% Pb contained for a saleable concentrate.
Silver recovery is 85.6% from the rougher tails, with 15.2% of the silver
reporting through to the lead concentrate at a grade of 856 g/t Ag, whilst
copper and gold both reported to the lead concentrate with grades of 2.62% Cu
and 0.52 g/t Au.
BHM expects that these recovery figures may be conservative as there is much
metallurgical development and many optimisation tests still to occur on the
project. More definitive testing will be initiated using core obtained from
diamond drill core planned for later in the year. This work will include
crushing, milling and abrasion work indices.
The Company announced on 2 November 2022 that the concrete entrance to the old
underground portal and decline has now been exposed by excavation. Discussions
held with people closely associated with the mining activity in the 1980s
indicate that the mine was constructed with the use of steel and timber
support beams. It's therefore possible that the decline remains open and clear
beyond the portal. The decline was constructed using a 3.5m x 3.0m profile and
varies in slope angle between an initial slope of 1:12 and steepening to a 1:7
rate of decline lower in the decline.
Access agreements were signed in preparation for our initial drill programme
which is planned to consist of 4 geotechnical holes. These holes are designed
to gather information on ground conditions to feed into underground mine
design. These initial holes will also provide material for crushing and
grinding work indexes and uniaxial compressive strength ("UCS") tests to
measure the ability of the rock to withstand stress once mining commences.
Rockfire was delighted to announce on 21 November 2022, that geotechnical
drilling was underway in Greece. An initial 4 holes (for a total of 840m) are
planned to be drilled within the main mineral resource of 2.3Mt @ 11% zinc
equivalent. These initial 4 geotechnical holes are expected to be followed by
more holes to gather geotechnical information throughout the 1.5km of the
resource and beyond. The average depth of drilling is 210m d, with the deepest
hole planned to reach 270m below surface.
As part of the process to reach commercial extraction, the geotechnical tests
for which this core will be used form a critical stepping-stone on the path to
feasibility. The first holes are designed to provide the following analytical
and geotechnical outcomes:
· Confirmatory analysis to ensure correlation with previous assay
results;
· To gather geotechnical orientation and structural data to refine
the interpretation of the orebody at Molaoi;
· To obtain core for UCS tests. These tests inform our mining
engineers of rock strengths when loads are applied/reduced in an actual mining
scenario; and
· To obtain sufficient core for crushing and grinding work indices.
These tests determine the energy (and therefore cost) of crushing and grinding
the ore to a powder and will form a key component of a feasibility study into
the economics of the project.
High-grade results of rock samples taken from historic mullock (waste) dumps
and surface outcrops were announced to the market on 28 November 2022. Zinc up
to 25% Zn, lead up to 16.8% Pb and silver up to 498g/t Ag were returned in
rocks from waste dumps and outcrop around old mine workings.
The highest results obtained are from the "Kalamaki" prospect, where the JORC
resource of 2.3Mt @ 9.4% Zn, 1.7% Pb and 47g/t Ag is located. 9.3% Zn has been
found in old workings at the "Fournos" prospect, approximately 1.5km north of
the JORC mineral resource. Previous drilling by the Greek Government has
encountered 3m @ 8.4% Zn in diamond drill core at Fournos.
Zinc at 15.8% Zn has been found in old workings at the "Mesovouni" prospect,
approximately 1.0km northwest of the JORC resource. Previous drilling by the
Greek Government had encountered 3m @ 6.7% Zn in diamond drill core at
Mesovouni. Similarly, 8.7% Zn, 5.2% Pb and 161g/t Ag has been found in outcrop
to the north of the "Gkagkania" prospect, approximately 1.5km northwest of the
JORC resource. Previous drilling by the Greek Government had encountered 7m @
10.2% Zn in diamond drill core at Gkagkania.
Being from the spoils (waste) around the opening of old workings, it is
testimony to the high grades of zinc, lead and silver encountered during
historical mining. Several high-grade results were obtained from outcrops with
no historical mining. This emphasises the quality of targets to the north and
northwest of the main resource area.
On 12 December 2022, the market was informed that massive sulphides had been
encountered in drilling at the predicted depth and position.
Both massive and semi-massive sulphides were encountered in Rockfire's first
drill hole at a depth and position predicted from historical drill data.
Between 1979 and 1988, 173 diamond drill holes were drilled at Molaoi, as well
as metallurgical tests, a feasibility study and the development of a portal
and decline to the orebody. The
Company's exploration and exploitation permit allows Rockfire to capitalise on
this excellent work by the Greek Government to help monetise the project in a
timely manner.
Rockfire's first hole at Molaoi (MO_GTK_001) lies between historical drill
holes and will serve to provide core for geotechnical test work to feed into a
feasibility study. Massive sulphides occur between 130m and 134m, with
semi-massive and disseminated sulphides continuing for a further 11m, down to
145m. More disseminated sulphides have also been encountered at 160m depth,
which may represent a parallel lode beneath the main lode.
It is expected that sufficient mineralised core will be obtained to commence
crushing and grinding work index studies. These studies determine the energy
(and therefore cost) required to crush and grind the mineralised rock. The
results from these studies are parameters required for technical and financial
feasibility studies, which Rockfire plans to commence as soon as possible.
Lighthouse, Queensland Australia
The Lighthouse tenement includes the Plateau gold deposit, where an Inferred
JORC resource has been drilled by Rockfire of 3.9 million tonnes @ 1.1 g/t Au
and 6.4 g/t Ag (0.5g/t cut-off), for 131,302 ounces of gold and 800,000 ounces
of silver. The tenement also comprises the Cardigan Dam, Split Rock and Double
Event prospects.
On 11 April 2022, the Company announced that 557 soil samples had been
collected from four sites within the Lighthouse tenement and results of this
work were released to the market on 21 June 2022. Soil sampling returned
strongly elevated gold results which outline a readily accessed and untested
target at least 200 m long. The target is outside the area included in the
JORC resource. Gold-in-soil values as high as 0.67g/t were encountered, as
well as 2.3g/t silver. The soil anomaly is open along strike and extends
beyond the limit of the sampling grid. Rockfire's management believes that the
soil anomaly may present a target based on high-grade gold-in-rock samples as
well.
Ongoing mapping and rock sampling at Plateau identified multiple new targets
close to the drilled JORC gold resource and an announcement on 2 August 2022
confirmed that numerous faults have been identified. These faults are believed
to carry fluids rich in gold and are interpreted as structural controls on
gold mineralisation, including the Central Breccia and Eastern Breccia
resources at Plateau. A new structural interpretation was completed which
highlighted areas where dilation and rotation of the rocks has occurred. This
provides open space within the rocks for heated and mineralised fluids to
percolate through and deposit gold, silver and other metals.
Seventeen (17) rock samples collected during June 2022 outline two of the new
exploration targets with results including 10.7 g/t Au, 3.2 g/t Au and 2.3 g/t
Au. Twenty-nine percent (29%) of the rock samples returned results above 0.5
g/t Au, with more than 80% of results being above 0.1 g/t Au.
Rockfire continued to target additional near-surface, open-cut gold at
Plateau. Soil sampling, rock sampling, geological mapping and geophysics
confirm the presence of additional gold targets close to the edges of an
intruded breccia (shattered rock), where the previously drilled 131,302 ounces
of gold resource is positioned.
The new targets combined could add material ounces to the already-defined gold
resources. With five new targets showing similar surface grades and dimensions
to those in the two resource areas, it is realistic to target multiples of the
resources already drilled.
Copperhead Porphyry Project, Queensland Australia
At the start of the reporting period, Rockfire had recently completed a
diamond drilling programme and an update to the market was provided on 20
January 2022. This update included assay results for the third diamond drill
hole (BCH003), which returned 370 m @ 0.20 % CuEq. from 57 m. Copper veins
were observed throughout the entire 429 m long drill hole. The drill hole
finished in copper-bearing veins.
Within this broad zone a higher-grade interval of 50 m @ 0.35 % CuEq. occurs
from 259 m downhole depth and a more intensely veined interval of 22 m @ 0.41
% CuEq. has been intersected from 271 m downhole depth. Hole BCH003
significantly expanded copper mineralisation by 100 m directly east of hole
BCH001 (501m @ 0.14% CuEq.), and 200 m north of hole BCH002 (357m @ 0,11%
CuEq.), resulting in another significant increase in the footprint of the
drilled copper-bearing area.
Hole BCH003 is, to date, the highest-grade hole drilled at Copperhead and long
intervals including 62m @ 0.3% CuEq. is most encouraging. The grade
variability is typical of large porphyry copper systems but importantly, the
footprint of copper mineralisation is expanding with each hole. This third
hole significantly expands the volume, and therefore tonnage, of the deposit.
Based on drilling 5 deep diamond holes at Copperhead, Rockfire announced a
maiden inferred JORC mineral resource of 64 million tonnes @ 0.19% CuEq. for
120,000 tonnes of copper equivalent on 21 March 2022.
Mineral Resource Statement (effective date 14th March 2022)
Cut-off (Grade Cu Eq %) Resource Category Tonnage (Mt) Grade Contained Metal
Cu Eq % Cu % Mo % Ag (g/t) Cu Eq (Kt) Cu (Kt) Mo (Kt) Ag (M oz)
0.13 Inferred 64 0.19 0.12 0.015 0.55 120 80 9.4 1.1
The mineral resource remains open to the north, east, west and at depth
leaving scope for significant further resource increases. The extent and tenor
of mineralisation at Copperhead have yet to be fully tested. Copper
mineralisation starts at surface and continues for at least 400 m vertically
below surface. With continued exploration success and expansion of the
resource, Copperhead demonstrates potential to form a low-cost, bulk-tonnage,
open-cut mining scenario.
Copper Dome
On 11 April 2022, it was announced that a landowner access and compensation
agreement had been signed with the landowner at the Copper Dome porphyry
project in Queensland.
A three-dimensional interpretation of an airborne helicopter-supported
magnetic survey had been commissioned at the end of the previous reporting
period to determine the characteristics of the magnetic response at depth.
This 3D interpretation highlighted two large, strongly magnetic bodies lying
approximately 500m below the surface. These bodies were both characterised by
long intervals of low-grade copper and gold immediately above them which had
been discovered in historical RC drilling.
Copper Dome remains a highly prospective porphyry copper/gold target for
Rockfire, but no further work was completed during the 2022 calendar year.
KEY PERFORMANCE INDICATORS (KPI's)
The Board monitors KPI's, which it considers appropriate for a group at
Rockfire's stage of development.
Financial KPI's
During the year, the Board monitored the following KPI's:
· Cash flow and working capital;
· Short-term and long-term cash flow models, which include variance
analysis from original budgets.
RISK MANAGEMENT
The Board regularly reviews the risks to which the Group is exposed and
ensures through its meetings and regular reporting that these risks are
minimised as far as possible.
The principal risks and uncertainties facing the Group at this stage in its
development are
Exploration risk
The Group's business has been primarily mineral exploration and evaluation
which are speculative activities and, whilst the Directors are satisfied that
good progress is being made, there is no certainty that the Group will be
successful in the definition of economic mineral deposits, or that it will
proceed to the development of any of its projects or otherwise realise their
value.
The Group aims to mitigate this risk when evaluating new business
opportunities by targeting areas of potential where there is at least some
successful historical drilling or geological data available.
Resource risk
All mineral projects have risk associated with defined grade and continuity.
Mineral reserves and resources are calculated by the Group in accordance with
accepted industry standards and codes but are always subject to uncertainties
in the underlying assumptions which include geological projection and
commodity price assumptions.
The Group reports mineral resources and reserves in accordance with the
Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves ('the JORC Code'). The JORC Code is a professional code of
practice that sets minimum standards for public reporting of mineral
exploration results, mineral resources and ore reserves. Further information
on the JORC Code can be found at www.jorc.org (http://www.jorc.org) .
Environmental, landowner and native title risk
Exploration and development of a project can be adversely affected by
environmental legislation and the unforeseen results of environmental studies
carried out during evaluation of a project. Once a project is in production,
unforeseen events can give rise to environmental liabilities.
Access and compensation agreements are required to be negotiated between the
Company and the landowner at each project. Queensland legislation provides an
agreement template which may be modified by the Company and the landowner. The
Company cannot guarantee landowners will provide access, regardless of
existing laws in place to ensure such access is negotiated on fair terms.
Where native title exists, the Company obtains the necessary approvals for
access and working programmes according to legislation and the Company's
environmental, social and governance ("ESG") programme.
The Group is currently in the exploration stage. Any disturbance to the
environment during this phase is minimal and is rehabilitated in accordance
with the prevailing regulations of the countries in which we operate.
Financing and liquidity risk
The Group has an ongoing requirement to fund its activities through the equity
markets and in the future to obtain finance for project development. There is
no certainty such funds will be available when needed. To date, Rockfire has
managed to raise funds primarily through equity placements despite the very
difficult markets that currently exist for raising funding in the junior
mining industry.
Political risk
All countries carry political risk that can lead to interruption of activity.
Politically stable countries can have enhanced environmental and social
permitting risks, risks of strikes and changes to taxation whereas less
developed countries can have in addition, risks associated with changes to the
legal framework, civil unrest and government expropriation of assets.
Bribery risk
The Group has adopted an anti-corruption policy and whistle blowing policy
under the Bribery Act 2010. Notwithstanding this, the Group may be held liable
for offences under that Act committed by its employees or subcontractors,
whether or not the Group or the Directors had knowledge of the committing of
such offences.
Insurance coverage
The Group maintains a suite of insurance coverage that is appropriate for the
Group and Company. This is arranged via a specialist mining insurance broker
and coverage includes public and products liability, corporate and
professional, travel, property and medical coverage and assistance while Group
employees and consultants are travelling on Group business. This is reviewed
at least annually and adapted as the Group's scale and nature of activities
changes.
Internal controls and risk management
The Directors are responsible for the Group's system of internal financial
control. Although no system of internal financial control can provide absolute
assurance against material misstatement or loss, the Group's system is
designed to provide reasonable assurance that problems are identified on a
timely basis and dealt with appropriately.
In carrying out their responsibilities, the Directors have put in place a
framework of controls to ensure as far as possible that ongoing financial
performance is monitored in a timely manner, that corrective action is taken
and that risk is identified as early as practically possible. The Directors
review the effectiveness of internal financial control at least annually.
The Board continuously monitors and upgrades its internal control procedures
and risk management mechanisms and assesses both for effectiveness during the
annual review. This process enables the Board to determine if the risk
exposure has changed during the year. In order to assist the risk management
function, the Company has a risk management policy, which is reviewed
annually. The Executive Directors report regularly to the Board on the
management of material business risks.
The Board, subject to delegated authority, reviews capital investment,
property sales and purchases, borrowing facilities, guarantees and insurance
arrangements.
CORPORATE SOCIAL RESPONSIBILITY
The Board takes account of the significance of social, environmental and
ethical matters affecting the business of the Group. At this stage in the
Group's development the Board has not adopted a specific policy on corporate
social responsibility as it has a limited pool of stakeholders other than its
shareholders. Rather, the Board seeks to protect the interests of Rockfire's
stakeholders through individual policies and through ethical and transparent
actions.
SHAREHOLDERS
The Directors are always prepared, where practicable, to enter into dialogue
with shareholders to promote a mutual understanding of objectives and
outcomes. The Annual General Meeting provides the Board with an opportunity to
informally meet and communicate directly with investors.
ENVIRONMENT
The Board recognises that the Group's principal activity, mineral exploration,
has the potential to impact on the local environment. To date, activities at
the various projects have been limited to surveying and drilling activities
and the Group does comply with local regulatory requirements with regard to
environmental compliance and rehabilitation. The impact on the environment of
the Group's activities has the potential to increase should our projects move
into a development or production phase. This is currently assessed through
baseline environmental studies that are being undertaken and identifying
resources needed to manage environmental compliance in the future.
Given the Group's size and scale it is not considered practical or cost
effective to collect and report data on carbon emissions.
EMPLOYEES
The Group engages its employees to understand all aspects of the Group's
business and seeks to remunerate its employees fairly, being flexible where
practicable. The Group gives full and fair consideration to applications for
employment received regardless of age, gender, colour, ethnicity, disability,
nationality, religious beliefs, transgender status or sexual orientation. The
Group takes account of employees' interests when making decisions and welcomes
suggestions from employees aimed at improving the Group's performance.
The Group now operates in Queensland, Australia and Greece, where it recruits
locally as many of its employees and contractors as practicable..
SUPPLIERS AND CONTRACTORS
The Group recognises that the goodwill of its contractors, consultants and
suppliers is important to its business success and seeks to build and maintain
this goodwill through fair dealings. The Group has a prompt payment policy and
seeks to settle all agreed liabilities within the terms agreed with suppliers.
The Company encourages best practice from suppliers and contractors with
regards to environmental issues.
HEALTH AND SAFETY
The Board recognises that it has a responsibility to provide strategic
leadership and direction in the development of the Group's health and safety
strategy in order to protect all of its stakeholders. The Group does not have
a formal health and safety policy at this time. This is re-evaluated as and
when the Group's nature and scale of activities change.
ENGAGEMENT WITH STAKEHOLDERS
The Board of Rockfire is proud of the high standard of corporate governance it
has established and maintains. The Board makes a conscious effort to
understand the interests and expectations of the Company's stakeholders, and
to reflect these in the choices it makes in its effort to create long-term
sustainable success for our business.
Engagement with our shareholders and wider stakeholder groups, including
employees, landowners, suppliers, contractors and government agencies, plays a
central role throughout Rockfire's business. The Board is aware that each
stakeholder group requires a specific and unique engagement approach in order
to create and maintain effective, sustainable and mutually beneficial
relationships.
The Board's understanding of various stakeholder interests is factored into
programme planning, boardroom discussions, strategy and budgets to assess
potential long-term impacts of our business on each group, and how we might
best address stakeholder expectations from our business.
Throughout this Annual Report, we provide examples of how we:
· Take into account the likely consequences of long-term
decisions;
· Foster relationships with stakeholders;
· Understand our impact on our local communities and the
environment; and
· Demonstrate the importance of behaving responsibly.
This engagement with stakeholders section forms our section 172 statement and
should be read in conjunction with other information included in this Annual
Report. Section 172 of the Companies Act 2006 requires the Directors to act in
a way that they consider, in good faith, would most likely promote the success
of the Company for the benefit of its members as a whole, taking into account
the factors listed in section 172.
The Directors continue to observe, plan for, and communicate the interests
of the Company's stakeholders, including the impact of its exploration
activities on local communities and the environment. Acting in good faith and
fairly between members, the Directors consider what is most likely to promote
the success of the Company for its members in the long term.
The Board regularly reviews its principal stakeholders and how it engages with
each. Stakeholder expectations are brought into the boardroom throughout the
annual cycle through information provided by management and by direct
engagement with stakeholders themselves. The priority of each stakeholder
group may increase or decrease, depending on the degree of impact any decision
may have on any particular stakeholder group. The Board therefore seeks to
consider the impact and priorities of each stakeholder group during its
discussions and as part of its decision making.
The table below sets out the key stakeholder groups, their interests and how
Rockfire has engaged with them over the reporting period. However, given the
importance of stakeholder focus, long-term strategy and reputation, these
themes are also discussed throughout this Annual Report.
Stakeholder Their interests How we engage
Our investors · Comprehensive review of financial performance of the business · Annual Report
· Business sustainability · Company website
· High standard of governance · Shareholder circulars
· Success of the business · Podcasts and interviews
· Ethical behaviour · Corporate information including Company announcements and
presentations
· Director experience
· AGM results
· Awareness of long-term strategy and direction
· Conference presentations
· Project prospectivity
· Stock exchange announcements
· Improving market perception of the business
· Press releases
· Appointment of a public relations advisor
· Frequent communication through briefings with management
· Shareholder communication policy, which is renewed annually
· Specific shareholder liaison officer on the Board (Chief
Executive Officer)
· Social media
· One- to- one meetings with large existing or potential new
shareholders
Regulatory bodies · Compliance with regulations · Company website
· Worker pay and conditions · Stock Exchange announcements
· Health and safety · Annual Report
· Brand reputation · Regular contact with QCA, share registrar, LSE and Companies
House
· Waste and environment
· Compliance updates at Board meetings
· Insurance
· Risk management policy, updated annually
· Environmental protection
· Compliance with local regulatory requirements and industry
standard principles for environmental and social risk management
· Appointment of a nominated advisor in accordance with the AIM
Rules
· Appointment of a competent person in accordance with the AIM
Rules
· Adhere to Australian and Greek laws and regulations
· Adoption of best practice policies recommended by the World
Bank and The International Council on Mining and Metals
Community · Sustainability · Philanthropy. Drilling of a water bore is offered to the
landowner during each drill programme
· Human rights
· Corporate responsibility is overseen by a dedicated exploration
· Community outreach manager
· Employment of local contractors wherever possible
· Prompt rehabilitation of drill sites
· Providing opportunity for local businesses to cater for our
exploration programs
· Local landowners are paid promptly
· Landowner access and compensation agreements
· Active communication with landowners and communities where
field work is taking place
· Adhere to Greek and Australian Government guidelines for
approaching landowner and native title holder discussion
Environment · Energy usage · All operational waste is completely removed from site and taken
to a waste and/or recycling facility
· Recycling
· Detailed field operation guidelines to minimise any negative
· Waste management environmental impact of exploration activities
· Obtaining environmental permits for exploration works in Greece
and Australia, granted by the relevant Government
· Ensuring operational protocols are in place and monitoring the
adherence to these protocols
Suppliers · Terms and conditions of contract · All supplies are sourced locally where possible
· Procurement opportunities · Our suppliers and contractors have received repeat business
from Rockfire, which is testimony to the fine working relationship established
· Workers' rights
· Supplier performance is continually monitored by a dedicated
· Supplier engagement exploration manager
· Sustainability · All field programs, including supplier quotes are authorised by
the Executive Directors prior to implementation
· Long-term partnerships
· Local suppliers are paid promptly
· Fair trading and payment terms
· Contact and feedback to suppliers is regular and personal via a
dedicated exploration manager
Contractors · Terms and conditions of contract · All contractors are sourced locally where possible
· Health and safety · Contractors are trained in senior first aid, paid for by
Rockfire
· Human rights and modern slavery
· On-the-job training is provided
· Working conditions
· Local contractors are paid promptly
· Diversity and inclusion
· Rockfire pays contractors standard industry rates, which are
well in excess of minimum average wages
· Communication with contractors is frequent through a dedicated
exploration manager
· Induction for health and safety is mandatory for contractors
visiting site
· Daily safety meetings have been implemented during all field
operations
· Rockfire has a whistle-blower policy and procedure in place to
ensure compliance, safety and governance
· Code of conduct providing a framework for ethical decision
making
· Contact and feedback to contractors is regular and personal via
a dedicated exploration manager
· Anti-corruption and bribery policy
On behalf of the Board
David Price, Chief Executive Officer
6 June 2023
DIRECTORS' REPORT
Principal activities
The principal activities of the Group are currently exploration for gold and
copper resources in Queensland, Australia and zinc, lead, silver and germanium
resources in Greece. The Group's strategy is to explore for and, where the
Directors believe that it is commercially feasible, develop deposits of
precious and base metals. The Company strategy includes considering
opportunities for project sale or joint venture at a point when any of the
Group's projects becomes appropriately advanced enough to consider such
options.
The Group currently holds five exploration permits for minerals (EPMs) in
Queensland, Australia and one exploration/exploitation licence in Greece.
Financial overview
The loss for the year is in line with the Directors' expectations. With
funding being raised in October 2022 and June 2023, the Directors are
confident that they will be able to secure additional funding when required to
do so. The Directors are also of the view that the investment sentiment in the
resource sector is improving, to the extent that the exploration success the
Company has achieved to date should enable it to raise sufficient additional
exploration funding to continue its exploration programmes.
Further details of the Group's business, including its targets and strategies
is given in the Chairman's Statement and the Strategic Report.
Major events after the reporting period
For information regarding events after the reporting date, see note 19 to the
financial statements.
Dividends
The Directors are unable to recommend the payment of a dividend for the year
ended 31 December 2022 (2021: £nil).
Going concern
The current investment environment in the United Kingdom and elsewhere in the
World has made seeking equity funds for small cap exploration companies
challenging. The Board is therefore encouraged that in October 2022, the
Company raised gross proceeds of £375,000 through a subscription of
300,000,000 new ordinary shares of 0.1p each and in early June 2023, the
Company raised gross proceeds of £880,000 from the issue of 400,000,000 new
ordinary shares of 0.1p each. This will enable the Group to meet existing
liabilities plus enable further exploration, especially at its Molaoi project
in Greece.
The Board believes the Group will continue to generate sufficient working
capital to meet its future operational and exploration requirements and to
continue to advance them and will continue to have the ongoing support of its
shareholders, as required, for the foreseeable future.
Directors
The Directors in office during the year are listed below. The interests of the
Directors in the shares of the Company, and share options were as follows:
As at 31 December 2022 As at 31 December 2021 Ordinary shares As at 31 December 2022 As at 31 December 2021
Ordinary shares Options Options
Gordon Hart 18,423,530 8,823,530 10,000,000 10,000,000
Patrick Elliott 40,042,765 12,469,823 6,000,000 6,000,000
Ian Staunton - - 6,000,000 6,000,000
Nicholas Walley 75,200,000 59,000,000 6,000,000 6,000,000
David Price 46,350,000 13,850,000 10,000,000 10,000,000
Significant shareholdings
As at 4 May 2023, the Company was aware of the following holdings of 3% or
more of the issued share capital of the Company:
Ordinary shares % of the Company's issued share capital
Nicholas Walley 75,200,000 5.21%
Michael Somerset-Leeke 49,101,126 3.40%
Patrick Elliott 47,350,991 3.28%
David Price 46,350,000 3.21%
Directors' remuneration
Full details of Directors' emoluments are set out in note 5 to the financial
statements.
Environmental policy
The Group's projects are subject to the relevant Australian and Greek laws and
regulations relating to environmental matters.
The Group's strategy is to explore for and, where the relevant studies
indicate that it is economically viable to do so, to develop mineral deposits.
It is the Group's intention to conduct its exploration and investigation
activities in a professional and responsible manner, for the benefit of the
Company's shareholders, its employees and the national and local communities
within which it operates.
The Group aims at all times to conduct its operations in an environmentally
responsible manner and in accordance with relevant legislation. The Group aims
to adopt best practice policies as recommended by the World Bank, the
International Council on Mining & Metals ("ICMM") and others where the
Group deems local legislation to be inadequate in terms of environmental
protection. The Group has in place a detailed field operations guidelines
manual which covers in considerable detail the measures to be taken by field
personnel to minimise any negative environmental impact of current exploration
activities on the environment.
The Group also recognises the enormous potential of its activities for
positive impact on the communities in which it operates and strives to
optimise these positive impacts as far as possible.
Directors' indemnities
The Group has directors' and officers' indemnity insurance to cover its
Directors and officers against the costs of defending themselves in legal
proceedings taken against them in that capacity and in respect of any damages
resulting from those proceedings.
Political contributions
No political contributions have been made.
Auditor
A resolution proposing that PKF Littlejohn LLP be re-appointed will be put to
the forthcoming Annual General Meeting.
Statement of disclosure to auditor
The Directors who held office at the date of approval of this Annual Report
confirm that, so far as they are each aware, there is no relevant audit
information of which the Company's auditor is unaware and each Director has
taken all steps that he ought to have taken as a Director in order to make
himself aware of any relevant audit information and to establish that the
Company's auditor is aware of that information.
Statement of Directors' responsibilities
The Directors are responsible for preparing the Strategic Report, the
Director's Report and the financial statements in accordance with applicable
law and regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law the Directors have prepared the Group and
Company financial statements in accordance with UK-adopted international
accounting standards and as regards the Company financial statements, as
applied in accordance with the requirements of the Companies Act 2006.
Under company law the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of
affairs of the Group and the Company and of the profit or loss of the Group
and Company for that period.
In preparing the Group and Company 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 comply with UK-adopted international
accounting standards, subject to any material departures disclosed and
explained in the financial statements;
· prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and Company will continue
in business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Group's and the Company's transactions and
disclose with reasonable accuracy at any time the financial position of the
Group and the Company and enable them to ensure that the financial statements
comply with the Companies Act 2006. They are also responsible for safeguarding
the assets of the Group and the Company and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The Group's Annual Report will be published on the Group's website and in this
regard the Directors accept responsibility for the maintenance and integrity
of the website.
Annual General Meeting and recommendation
The Board considers that the resolutions to be proposed at the Annual General
Meeting are in the best interests of the Company and the Group as a whole and
its unanimous recommendation is that shareholders support these proposals as
the Directors intend to do in respect of their own holdings. Further details
regarding the location and timing of the Company's forthcoming Annual General
Meeting will be provided shortly.
We welcome you to continue to take the journey with us as we build Rockfire
through exploration success and quality asset acquisition.
On behalf of the Board
David Price, Chief Executive Officer
6 June 2023
CORPORATE GOVERNANCE STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
As Chairman of Rockfire, it is my responsibility to ensure that Rockfire has
both sound corporate governance and an effective Board. I do that by ensuring
that the Company and the Board are acting in the best interests of
shareholders, and by making sure that the Board discharges its
responsibilities. This includes creating the right Board dynamic and ensuring
that all important matters, in particular strategic decisions, receive
adequate time and attention at Board meetings.
My responsibilities include leading the Board effectively, overseeing the
Group's corporate governance model, communicating with shareholders and
ensuring that good information flows freely between the Executive and
Non-executive Directors in a timely manner.
To the extent applicable, and to the extent able (given the current size and
structure of the Company and the Board), the Company has adopted the Quoted
Companies Alliance Corporate Governance Code (the Code). Details of how the
Company complies with the Code are set out below, together with the principles
contained in the Code.
In light of the Company's size and nature, the Board considers that the
current Board is a cost effective and practical method of directing and
managing the Company. As the Company's activities develop in size, nature and
scope, the size of the Board and the implementation of additional corporate
governance policies and structures will be reviewed. Further disclosures under
the Code are included on the Company's website.
Principle 1 - Establish a strategy and business model which promote long-term
value for shareholders
Rockfire is an AIM-quoted mineral explorer with projects located in northern
Queensland, Australia and the Peloponnese region of Greece. The Company's
strategy is to identify mineral deposits which can be developed into mines to
create value and income for shareholders.
Throughout 2022, the Board has delivered on its strategy to achieve growth of
the Group, with highly successful exploration results at Molaoi in Greece and
at the Plateau gold deposit and Copperhead project, in Queensland, Australia.
The Company continues to seek other resource projects.
Principle 2 - Seek to understand and meet shareholder needs and expectations
NEEDS OF SHAREHOLDERS
The principal need of a shareholder is to achieve a return on their investment
EXPECTATIONS OF SHAREHOLDERS
A shareholder can reasonably expect the Company and Management to;
· deliver on its obligations and commitments to Principal 1.
· ensure its management and directors act with integrity and
professionalism in running the company
· direct the expenditure of monies on appropriate exploration
methods and to ensure expenditure is justified and accountable
· provide enough flow of information on exploration progress to
allow the shareholder to make informed decisions on their investment
· publish clear and concise announcements, with minimal technical
complexity
· have open access to the Board or CEO to provide clarification
We seek to engage with our shareholders through updates to the market via
regulatory news flow ('RNS'), on matters of a material substance and
regulatory nature. Whilst being mindful of the requirements of the AIM Rules
and Market Abuse Regulations the Board may engage with Shareholders directly
from time to time in relation to questions that they may have and other
matters.
The Company's AGM will also provide an opportunity for shareholders to ask
questions during the formal business of the meeting and informally following
the meeting.
The Board shall ensure that the voting decisions of shareholders at the AGM
are reviewed and monitored and that approvals sought at the Company's AGM will
be in line with the recommended corporate guidelines of the QCA Code.
Shareholder enquiries should be emailed to: info@rockfireresources.com.
Principle 3 - Take into account wider stakeholder and social responsibilities
and their implications for long-term success
Consider wider stakeholder and social responsibilities and their implications
for long term success.
ENGAGEMENT
The Board believes that engaging with stakeholders strengthens relationships
and helps make better business decisions to deliver on commitments. The Board
is regularly updated on wider stakeholder engagement feedback to stay abreast
of stakeholder insights into the issues that matter most to them, and to
enable the Board to understand and consider these issues in decision-making.
Aside from Shareholders, suppliers and customers, our workforce is one of the
most important stakeholder groups and the Board therefore closely monitors
their feedback to ensure alignment of interests
WORKFORCE
The Board has established a safe and healthy work environment, which complies
with the relevant Occupational Health and Safety laws. It has tried to ensure
that the workforce is provided with enough training to develop the appropriate
skills and knowledge to complete the tasks requested of them.
The Company shall;
· adhere to the relevant laws, rules and regulations within the
jurisdictions in which it operates
· ensure technical reporting obligations are submitted on time
· complete environmental management reports for the government
· comply with site-clearing and rehabilitation guidelines and
expectations on a "best practice" approach
TRADITIONAL LANDOWNERS
The Company shall respect traditional lands, customs and culture on all land
with registered traditional ownership. Heritage clearance, as required by law
shall be sought and honoured. Where appropriate, traditional landowners shall
be consulted with and included in any opportunities for employment on an equal
basis.
LANDOWNERS & PASTORALISTS
The Company shall respect and acknowledge the rights of landowners and
leaseholders. The Company shall work with the landowner in an ethical manner
and where possible, shall offer opportunity to the landowner to participate in
the work program.
CONTRACTORS & SUPPLIERS
· For the sake of Occupational Health & Safety, all contractors
and sub-contractors shall be treated in the same manner as employees.
· Independent contractors will be required to provide their own PPE
(personal protective equipment) whilst working on any of the Company sites
· All Contractors shall be subject to a Site Induction on their
first visit to any of the sites being explored by the Company.
· All independent contractors will be required to carry their own
Public Liability and Workers Compensation Insurances.
· To ensure a safe and productive work environment, the appropriate
Occupational Health & Safety requirements, induction procedures and safety
precautions shall be established by the Company.
The Company has designated an appropriately experienced and qualified
representative to act as a "Liaison Officer" between contractors and the
Company.
Principle 4 - Embed effective risk management, considering both opportunities
and threats, throughout the organisation
The risks facing the Company are detailed in the risk management section of
the Strategic Report. The Board seeks to mitigate such risks so far as it is
able to do, but certain important risks cannot be controlled by the Board.
In setting and implementing the Company's strategies, the Board, having
identified the risks, seeks to limit the extent of the Company's exposure to
them having regard to both its risk tolerance and risk appetite.
Principle 5 - Maintain the board as a well-functioning, balanced team led by
the chair
Ian Staunton is considered to be independent. Nicholas Walley and Patrick
Elliott, as significant shareholders, are not considered to be independent.
The Company is aware that having an Executive Chairman is not in line with the
recommendations made by the QCA. The role of Executive Chairman has been
primarily to ensure that best practice policies and procedures are implemented
through identifying and appointing the appropriate Directors, ensuring the
Board is run in an effective manner, and assisting the Chief Executive Officer
with legacy matters. There is a clear split of responsibilities between the
Executive Chairman and the Chief Executive Officer. The Board believes that
the skillsets of the Chairman and the non-independent Non-executive Directors
are appropriate and beneficial for all shareholders and stakeholders.
All Directors are expected to devote the necessary time commitments required
by their position and are expected to attend all Board meetings. The Board
convenes outside these meetings on an ad hoc basis as and when it deems
necessary.
The Chief Executive Officer works full time for the Company. The Executive
Chairman is expected to devote sufficient time as to fulfil the needs of the
Company, The Non-executive Directors are expected to dedicate up to 3 days per
month to the Company's affairs. The Board is satisfied that each of the
Directors is able to allocate sufficient time to the Company to discharge
their responsibilities effectively.
The number of meetings of the Board and attendance for the year ended 31
December 2022 are set out below:
Meetings held Meetings attended
Gordon Hart 14 14
Patrick Elliott 14 9
Ian Staunton 14 12
Nicholas Walley 14 14
David Price 14 14
Principle 6 - Ensure that between them the directors have the necessary
up-to-date experience, skills and capabilities
The Board comprises the Executive Chairman, Gordon Hart; the Chief Executive
Officer, David Price; and three Non-executive Directors, Ian Staunton, Patrick
Elliott and Nicholas Walley. Further details on the Board can be found on the
Director biographies section of the 2022 Annual Report, which details the
relevant experience, skills and personal qualities and capabilities that each
director brings to the board.
The Board is therefore satisfied that it has a suitable balance between
independence on the one hand, and direct managerial and operational knowledge
of the Company on the other, which ensures that no individual or group may
dominate the Board's decisions. The Board is also satisfied that the Board has
sufficient knowledge of the Group and its operations to enable it to discharge
its duties and responsibilities effectively. All Directors use their
independent judgement to challenge all matters, whether strategic or
operational.
The Directors endeavour to ensure that their knowledge of best practices and
regulatory developments is up to date by technical reading and attending
relevant seminars and conferences as considered necessary. All Directors
receive regular updates on legal and governance issues. Nicholas Walley has
been attending various QCA seminars on remuneration. David Price has attended
various technical seminars. Gordon Hart has attended numerous webinars and
conferences held by the Australian Institute of Company Directors. All
Directors are encouraged to attend presentations, conferences and webinars
which improve their skill base.
Rockfire has a Company Secretary whose role is to work closely with the
Chairman to maintain high standards of corporate governance, ensuring that the
necessary information is supplied to the Directors on a timely basis and that
the Company complies with all applicable rules, regulations and obligations
governing its operation.
The Board has regular contact with its advisors to ensure that it is aware of
changes to generally accepted corporate governance procedures and requirements
and that the Group remains compliant with applicable rules and regulations.
The Company's nominated advisor supports the Board's development, specifically
providing guidance on corporate governance and other regulatory matters, as
required.
Each Director can take independent professional advice in the furtherance of
his duties, if necessary, at the Company's expense. In addition, the Directors
have direct access to the advice and services of the Company Secretary.
Neither the Board nor its committees have sought external advice on a
significant matter during this period.
Principle 7 - Evaluate board performance based on clear and relevant
objectives, seeking continuous improvement
Given the current stage of the Company's development the Directors believe
that the Board operates efficiently and cost effectively and that the cost of
an internal or external review process is not justified. Nevertheless, it is
intended that the Board will be strengthened in due course to reflect the
Group's progress with exploration and growth.
No board performance evaluation has taken place in the year for the reason
described above.
Principle 8 - Promote a corporate culture that is based on ethical values and
behaviours
The Board recognises that its decisions regarding strategy and risk will
impact the corporate culture of the Group as a whole and that this will impact
the performance of the Group. The Board is aware that the tone and culture set
by the Board will greatly impact all aspects of the Group and the way that
employees and other stakeholders behave. The Corporate Governance arrangements
that the Board has adopted are designed to ensure that the Company delivers
long term value to its shareholders, and that shareholders have the
opportunity to express their views in a manner that encourages open dialogue
with the Board. Therefore, the importance of sound ethical values and
behaviours is crucial to the ability of the Company to successfully achieve
its corporate objectives.
A large part of the Company's activities is centred upon an open and
respectful dialogue with employees, contractors, clients and other
stakeholders. The Board places great importance on this aspect of corporate
life and seeks to ensure that transparency and openness are evident in all
that the Company does. The Directors consider that at present the Company
has an open culture facilitating comprehensive dialogue and feedback and
enabling positive and constructive challenge.
The Board has adopted a code of conduct which provides a framework for ethical
decision-making and actions across the Group. The code of conduct reiterates
the Group's commitment to integrity and fair dealing in its business affairs
and its duty of care to all employees, contractors and stakeholders.
Each Board member's adherence to the Group's code of conduct is assessed
annually. Employees are assessed on their performance and their adherence to
the code of conduct through their annual performance review.
Principle 9 - Maintain governance structures and processes that are fit for
purpose and support good decision-making by the board
BOARD PROGRAMME
The Board is responsible for approving the Company strategy and policies, for
safeguarding the assets of the Company, and is the ultimate decision-making
body of the Company in all matters except those that are reserved for specific
shareholder approval.
The Board sets direction for the Company through a formal schedule of matters
reserved for its decision.
The Board meets at least four times each year in accordance with its scheduled
meeting calendar and maintains regular dialogue between Board members.
Prior to the start of each financial year, a schedule of dates for that year's
Board meetings is compiled. This may be supplemented by additional meetings as
and when required.
The Board and its Committees receive appropriate and timely information prior
to each meeting, with a formal agenda being produced for each meeting, and
Board and Committee papers distributed several days before meetings take
place.
Any Director may challenge Company proposals and decisions are taken
democratically after discussion. Any Director who feels that any concern
remains unresolved after discussion may ask for that concern to be noted in
the minutes of the meeting, which are then circulated to all Directors. Any
specific actions arising from such meetings are agreed by the Board or
relevant Committee and then followed up by the Company's executive management
team.
ROLES & RESPONSIBILITIES
There is a clear division of responsibility at the head of the Company.
The Chairman is responsible for:
· running the business of the Board;
· setting the agenda for Board meetings;
· ensuring appropriate strategic focus and direction;
· facilitating effective contribution from all Directors; and
· promoting constructive and respectful relations between the Board and
management.
The CHIEF EXECUTIVE OFFICER is responsible for:
· proposing the strategic focus to the Board;
· implementing strategy once it has been approved by the Board;
· overseeing the management of the Company through the executive
management team; and
· where proposed transactions, commitments or arrangements exceed the
thresholds set by the Board to refer the matter to the Board for its
consideration, review and approval.
The Board is supported by the Audit and Remuneration committees. Each
committee has access to such resources, information and advice as it deems
necessary, at the cost of the Company, to enable the committee to discharge
its duties.
The Audit Committee's primary function is to assist the Board in fulfilling
its responsibilities by reviewing the:
· Quality and integrity of financial reporting.
· Systems of internal control which management and the Board have
established to safeguard the Group's financial and physical assets and
facilitate compliance with relevant statutory and regulatory requirements.
· Processes for business risk identification, quantification and
mitigation.
· Effectiveness and independence of the external audit process.
· Quality and relevance of financial and non-financial information
provided to management and the Board on which decisions will be based.
The Audit Committee acts as the Board's committee to oversee risk.
The Remuneration Committee acts as the Board's committee to oversee employment
and remuneration contracts for management and directors.
The roles of the Audit and Remuneration Committees are available on the
website at www.rockfireresources.com
All matters that have a material impact upon the Company or any of its
subsidiaries will be referred to the Board. However, below is a schedule of
matters reserved specifically for the decision of the Board or a duly
authorized committee thereof. The Board has the authority to obtain outside
legal or other independent advice at the expense of the Company.
Financial matters
· Approval of full year (preliminary) and half year
results announcements.
· Adoption of significant change in accounting policies or
practices.
· Approval of all circulars and prospectus to shareholders.
· Changes relating to the capital structure of the company.
· Approval of increases in share capital of any Group Company.
· The approval of all guarantees given by the Company.
· Ratify the use of Rockfire Resources plc company seal.
Corporate matters
· Convening general meetings of the Company.
· Recommending to shareholders the approval of alterations to the
Memorandum and Articles of Association of the company.
· Making any take-over offer for another company or other companies
within the City Code on Takeovers and Mergers and considering a response to
any such approaches to the Company.
· Annual report and accounts
To issue the Annual Report and Accounts of the company having approved the
following:
· Strategic Report.
· Directors Report.
· Remuneration, Audit and Nomination Committee Reports
· Accounts and notes to the accounts.
Appointments and structure
· Appointment and removal of the Chairman.
· Appointment, removal and re-election of the Directors.
· Appointment and removal of the Company Secretary.
· Reviewing succession planning for the Board and senior management
of the Group.
· Carry out a formal and rigorous review of its own performance and
that of its committees and individual directors on an annual basis.
Budgets, contracts and business development
· Approval of strategic plans of the company.
· Approval of the annual budget of the company.
· Approval of significant changes in treasury and foreign currency
policy of the company.
· Approval of material contracts.
· Significant changes to the company's activities to include,
acquisitions or divestments or entry into a new foreign jurisdiction or exit
from an existing one.
· Internal controls
To receive reports directly from the Chief Executive Officer on the Group's
internal control systems and to consider amongst others:
· Changes in the nature and extent of significant risks to the
business.
· The key risks and how these are evaluated and managed.
To review annually the effectiveness of the company's internal control systems
and consider:
· For identified weaknesses, the actions being taken and the
timeliness of rectification.
· The effectiveness and output of the management's review process.
· Incidence of major control weaknesses, their cause and potential
impact on the business.
· To report to shareholders on the review of the internal control
systems.
Board committees
· Approving terms of reference for Board Committees and agreeing
division of responsibility between Chairman and Chief executive Officer.
· Recommendation to shareholders to appoint or remove the Company's
auditors including approval of their fees.
· Appointment or removal of the Company's principal advisors.
· Approval of major changes in employee share and incentive
schemes.
· Approval of the Group's Health and Safety Policy.
· Approval of the Group's Environmental Policy.
· Monitoring of the Directors and Officers Liability Insurance.
· Agreeing fee levels for Non-Executive Directors.
As the Group grows and develops the Board will periodically review its
corporate governance framework to ensure it remains appropriate for the size,
complexity and risk profile of the Group
Principle 10 - Communicate how the company is governed and is performing by
maintaining a dialogue with shareholders and other relevant stakeholders
The Board attaches great importance to providing shareholders with clear and
transparent information on the Company's activities, strategy and financial
position.
The Company communicates with shareholders through the Annual Report,
full-year and half-year announcements, the Annual General Meeting and
one-to-one meetings with large existing or potential new shareholders.
The Company announces significant developments which are disseminated via
various outlets including the London Stock Exchange's Regulatory News Service
(RNS).
The audit committee is chaired by Ian Staunton and includes Patrick Elliott
and Gordon Hart, and their biographies can be found on page 7. The role of the
committee is to consider and approve the interim results, and with the
auditors to consider the annual report and matters raised by the auditors
based on their audit. So far as possible recommendations by the auditors are
immediately implemented. To date, audit committee matters have been discussed
in full Board meetings. As such no formal audit committee reports have been
required.
The remuneration committee is chaired by Nicholas Walley and includes Patrick
Elliott, and their biographies can be found on page 7. The remuneration
committee meets on an ad hoc basis, when required. Fees payable to the
Non-executive Directors are determined by the Executive Directors.
Additional information supplied by the remuneration committee has been
disseminated across this Annual Report, rather than included as a separate
committee report.
Gordon Hart, Chairman
6 June 2023
INDEPENDENT AUDITOR'S REPORT
Opinion
We have audited the financial statements of Rockfire Resources Plc (the
'parent company') and its subsidiaries (the 'group') for the year ended 31
December 2022 which comprise the Consolidated Statement of Comprehensive
Income, the Consolidated and Parent Company Statements of Financial Position,
the Consolidated and Parent Company Statements of Changes in Equity, the
Consolidated and Parent Company Statements of Cash Flows and notes to the
financial statements, including significant accounting policies. The financial
reporting framework that has been applied in their preparation is applicable
law and UK-adopted international accounting standards and as regards the
parent company financial statements, as applied in accordance with the
provisions of the Companies Act 2006.
In our opinion:
· the financial statements give a true and fair view of the state
of the group's and of the parent company's affairs as at 31 December 2022 and
of the group's loss for the year then ended;
· the group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
· the parent company financial statements have been properly
prepared in accordance with UK-adopted international accounting standards and
as applied in accordance with the provisions of the Companies Act 2006; and
· 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 International Standards on Auditing
(UK) (ISAs (UK)) 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 and parent company 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.
Material uncertainty related to going concern
We draw attention to note 3 in the financial statements, which indicates that
the group will require further funds to be raised over the next 12 months in
order for the group to meet its exploration expenditure commitments and to
undertake the budgeted exploration activities. As stated in note 3, these
events or conditions indicate that a material uncertainty exists that may cast
significant doubt on the group's ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
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 group's and parent company's ability to continue to adopt
the going concern basis of accounting included a review of the cash flow
forecasts prepared by management, a review of management's assessment of going
concern and post year end information impacting going concern.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Our application of materiality
Materiality Basis for materiality
Group £102,000 (2021: £97,000) 2% of gross assets
Company £75,000 (2021: £75,000) Combination of 2% of gross assets and 5% of loss before tax
We consider gross assets to be the most significant determinant of the group's
financial position and performance used by shareholders, with the key
financial statement balances being intangible exploration and evaluation
assets and cash and cash equivalents. The going concern of the group is
dependent on its ability to fund operations going forward, as well as on the
valuation of its assets, which represent the underlying value of the group.
The basis for calculating materiality was unchanged from the prior year. The
benchmark for the parent company differs from the group in order to achieve
sufficient coverage of expenditure in our testing.
Whilst materiality for the group financial statements as a whole was set at
£102,000, materiality for the parent company was £75,000 and for significant
components was set at a range between £71,000 and £63,350 (2021: £75,000
and £58,000). Performance materiality at 70% was set at £71,400 for the
group, £52,500 for the parent company and for the significant components at a
range between 49,700 and £44,350 (2021: £67,900, £52,500 and £40,600
respectively). We applied the concept of materiality both in planning and
performing our audit, and in evaluating the effect of misstatements.
We agreed with the audit committee that we would report to the committee all
audit differences identified during the course of our audit in excess of
£5,100 (2021: £4,850) for the group and £3,750 (2021: £3,750) for the
parent company.
Our approach to the audit
In designing our audit, we determined materiality and assessed the risk of
material misstatement in the financial statements. In particular, we looked at
areas requiring the directors to make subjective judgements, for example in
respect of assessing the recoverability of exploration, evaluation and
development expenditure, the valuation of share-based payments, the carrying
value and recoverability of investments in subsidiaries at parent company
level, and the consideration of future events that are inherently uncertain.
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.
An audit was performed on the financial information of the group's significant
operating components which, for the year ended 31 December 2022, were located
in the United Kingdom, Australia and Greece. The audit of significant
components was performed in London solely by PKF Littlejohn LLP using a team
with experience of auditing mineral exploration and publicly listed entities.
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. In addition to the matters
described in the Material uncertainty related to concern section we have
determined the matters described below to be the key audit matters to be
communicated in our report.
Key Audit Matter How our scope addressed this matter
Carrying value and appropriate capitalisation of Intangible Assets (refer Note
9) (GROUP)
The group carrying value of intangible assets in relation to capitalised Our work in this area included:
exploration costs for its Australian and Greek projects is material. There is
a risk that these assets have been incorrectly capitalised in accordance with
the requirements of IFRS 6 and that there are indicators of impairment as at
31 December 2022. · Confirmation that the group has good title to the applicable
exploration licences, and has fulfilled any specific conditions therein
particularly having regard to minimum expenditure requirements;
Particularly for early stage exploration projects, where the calculation of · Review and substantive testing of capitalised costs, including
recoverable amount via value in use calculations is not possible, management's the fair value arising on the asset acquisition in the year, and consideration
assessment of impairment under IFRS 6 requires significant estimation and of appropriateness for capitalisation under IFRS 6;
judgement.
· Assessment of progress at the individual projects during the year
and post year-end;
· Consideration of management's impairment reviews in light of
impairment indicators identified in accordance with IFRS 6, including
corroboration and challenge thereof; and
· Evaluating the disclosures included within the financial
statements.
Recoverability of investments and intragroup balances (refer Notes 11 and 12)
(COMPANY)
Investments in subsidiaries and intragroup loans are significant assets in the Our work in this area included:
parent company's financial statements. Their recoverability is directly linked
to the recoverability of intangible assets in those entities, and hence may · Confirmation of ownership of the investments;
not be fully recoverable.
· Review of management's calculations of expected credit losses on
the intragroup balances to ensure the rationale and accounting treatment is in
accordance with IFRS 9;
· Consideration of recoverability of investments and intragroup
loans by reference to underlying net asset values and exploration projects;
and
· Evaluating the disclosures included within the financial
statements.
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 group and parent company 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
· the information given in the strategic report and the directors'
report for the financial year for which the financial statements are prepared
is consistent with the financial statements; and
· the strategic report and the directors' report have been prepared
in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent
company and their 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 in relation to
which the Companies Act 2006 requires us 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 parent company 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, the
directors are responsible for the preparation of the group and parent company
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 group and parent company financial statements, the directors
are responsible for assessing the group's and the parent company'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:
· We obtained an understanding of the group and parent company and
the sector in which they operate to identify laws and regulations that could
reasonably be expected to have a direct effect on the financial statements. We
obtained our understanding in this regard through discussions with management
and application of our cumulative audit knowledge and experience of the
industry. We ensured that the audit team collectively had the appropriate
experience with auditing entities within this industry, facing similar audit
and business risks, and of a similar size.
· We determined the principal laws and regulations relevant to the
group and parent company in this regard to be those arising from:
o AIM Rules;
o UK employment law; and
o Local tax laws and regulations.
· We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by the group
and parent company with those laws and regulations. These procedures included,
but were not limited to:
o Making enquiries of management;
o A review of Board minutes;
o A review of legal ledger accounts; and
o A review of RNS announcements.
· We addressed the risk of fraud arising from management override
of controls by performing audit procedures which included, but were not
limited to: the testing of journals, reviewing accounting estimates for
evidence of bias; and evaluating the business rationale of any significant
transactions that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will
not detect all irregularities, including those leading to a material
misstatement in the financial statements or non-compliance with regulation.
This risk increases the more that compliance with a law or regulation is
removed from the events and transactions reflected in the financial
statements, as we will be less likely to become aware of instances of
non-compliance. The risk is also greater regarding irregularities occurring
due to fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
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 our report
This report is made solely to the company's members, as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. 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.
David Thompson (Senior Statutory Auditor)
15 Westferry Circus
For and on behalf of PKF Littlejohn
LLP
Canary Wharf
Statutory
Auditor
London E14 4HD
6 June 2023
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER
2022
Note 2022 2021
£ £
Interest income 1 -
Impairment of intangible assets - (12,334)
Administrative expenses (753,213) (732,619)
Operating loss 6 (753,212) (744,953)
Loss before taxation (753,212) (744,953)
Taxation 7 - -
(753,212) (744,953)
Loss for the year attributable to shareholders of the Company
Items that may be reclassified subsequently to profit or loss:
Foreign exchange translation movement 138,883 (162,830)
Total comprehensive loss attributable to shareholders of the Company (614,329) (907,783)
Loss per share attributable to shareholders of the Company
Basic and diluted 8 (0.06)p (0.08)p
The notes form part of these financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 31 DECEMBER
2022
Note 2022 2021
£ £
Assets
Non-current assets
Intangible assets 9 4,451,118 3,447,739
Property, plant and equipment 10 38,323 20,189
Other receivables 12 85,872 -
4,575,313 3,467,928
Current assets
Cash and cash equivalents 420,255 1,473,599
Trade and other receivables 12 106,171 124,261
526,426 1,597,860
Total assets 5,101,739 5,065,788
Equity and liabilities
Equity attributable to shareholders of the Company
Share capital 13 7,435,409 7,078,136
Share premium 14 18,233,976 18,180,659
Other reserves 14 2,295,035 2,295,035
Merger relief reserve 14 190,000 -
Foreign exchange reserve 14 (51,123) (190,006)
Retained deficit (23,161,632) (22,408,420)
Total equity 4,941,665 4,955,404
Current liabilities
Trade and other payables 16 160,074 110,384
Total liabilities 160,074 110,384
Total equity and liabilities 5,101,739 5,065,788
The notes form part of these financial statements.
COMPANY STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 31 DECEMBER 2022
2022 2021
£ £
Assets Note
Non-current assets
Intangible assets 9 - 13,380
Property, plant & equipment 10 109 690
Investments 11 1,030,640 648,000
Total non-current assets 1,030,749 662,070
Current assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 12 4,605,819 3,573,333
Total current assets 4,642,824 4,994,134
Total assets 5,673,573 5,656,204
Equity
Equity attributable to owners
of the parent:
Share capital 13 7,435,409 7,078,136
Share premium 14 18,233,976 18,180,659
Other reserves 14 1,801,872 1,801,872
Merger relief reserve 14 190,000 -
Accumulated losses 14 (22,077,982) (21,489,448)
Total equity 5,583,275 5,571,219
LIABILITIES
Current liabilities
Trade and other payables 16 90,299 84,985
Total liabilities 90,299 84,985
Total equity and liabilities 5,673,574 5,656,204
As permitted by section 408 of the Companies Act 2006, the Company has not
presented its own income statement. The Company's total comprehensive loss for
the year was £588,534 (2021: loss of £717,442).
The financial statements were approved and authorised for issue by the Board
on 6 June 2023 and signed on its behalf by:
David Price, Chief Executive Officer
The notes form part of these financial
statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER
2022
Share capital Share premium Other reserves Merger Foreign exchange reserve Retained deficit Total equity
relief reserves
£ £ £ £ £ £ £
As at 1 January 2021 6,828,085 16,658,354 2,295,035 - (27,176) (21,779,516) 3,974,782
Loss for the financial year - - - - - (744,953) (744,953)
Foreign exchange translation movement - - - - (162,830) - (162,830)
Total comprehensive loss - - - - (162,830) (744,953) (907,783)
Shares issued during the year 250,051 1,630,995 - - - - 1,881,046
Share issuance costs - (108,690) - - - - (108,690)
Share-based expense - - - - - 116,049 116,049
Total transactions with shareholders 250,051 1,522,305 - - - 116,049 1,888,405
At 31 December 2021 7,078,136 18,180,659 2,295,035 - (190,006) (22,408,420) 4,955,404
As at 1 January 2022 7,078,136 18,180,659 2,295,035 - (190,006) (22,408,420) 4,955,404
Loss for the financial year - - - - - (753,212) (753,212)
Foreign exchange translation movement - - - - 138,883 - 138,883
Total comprehensive loss - - - - 138,883 (753,212) (614,329)
Shares issued during the year 307,273 95,727 - - - - 403,000
Share issuance costs - (42,410) - - - - (42,410)
Acquisition of subsidiary 50,000 - - 190,000 - - 240,000
Total transactions with shareholders 357,273 53,317 - 190,000 - - 600,590
At 31 December 2022 7,435,409 18,233,976 2,295,035 190,000 (51,123) (23,161,632) 4,941,665
The notes form part of these financial statements.
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2022
Share capital Share premium Other reserves Merger Retained deficit Total equity
relief
reserves
£ £ £ £ £ £
At 1 January 2021 6,828,085 16,658,354 1,801,872 - (20,888,055) 4,400,256
Loss for the financial year - - - - (717,442) (717,442)
Total comprehensive loss - - - - (717,442) (717,442)
Issue of share capital 250,051 1,630,995 - - - 1,881,046
Share issuance costs - (108,690) - - - (108,690)
Share-based payments - - - - 116,049 116,049
Total transactions with shareholders 250,051 1,522,305 - - 116,049 1,888,405
At 31 December 2021 7,078,136 18,180,659 1,801,872 - (21,489,448) 5,571,219
Loss for the financial year - - - - (588,534) (588,534)
Total comprehensive loss - - - - (588,534) (588,534)
-
Issue of share capital 307,273 95,727 - - - 403,000
Share issuance costs - (42,410) - - - (42,410)
Acquisition of subsidiary 50,000 - - 190,000 - 240,000
Total transactions with shareholders 357,273 53,317 - 190,000 - 600,590
At 31 December 2022 7,435,409 18,233,976 1,801,872 190,000 (22,077,982) 5,583,275
The notes form part of these financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2022
2022 2021
£ £
Cash flow from operating activities
Loss for the year before tax (753,212) (744,953)
Impairment of intangible assets - 12,334
Depreciation 8,677 7,052
Expenses settled in shares 28,000 31,041
Share-based expense - 116,049
Finance cost 1,477 -
Foreign exchange differences (105,327) (47,912)
Decrease / (Increase) in trade and other receivables 20,617 (61,748)
Decrease in trade and other payables (96,804) (9,148)
Net cash outflow from operating activities (896,572) (697,285)
Cash flow from investing activities
Exploration expenditure (459,292) (918,667)
Payment of long term deposit (85,872) -
Cash acquired with subsidiary 82,282 -
Acquisition of property, plant and equipment (25,003) (2,690)
Net cash used in investing activities (487,885) (921,357)
Cash flow from financing activities
Proceeds from issuance of ordinary shares 375,000 1,850,005
Share issuance costs (42,410) (108,690)
Interest paid (1,477) -
Net cash generated from financing activities 331,113 1,741,315
Net (decrease) / increase in cash and cash equivalents (1,053,344) 122,673
Cash and cash equivalents at the beginning of the year 1,473,599 1,350,926
Cash and cash equivalents at the end of the year 420,255 1,473,599
The notes form part of these financial statements.
COMPANY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2022
2022 2021
£ £
Cash flow from operating activities
Loss for the year before tax (588,534) (717,442)
Expenses settled in shares 28,000 31,041
Depreciation 580 460
Share-based expense - 116,049
Expected credit losses 86,022 168,482
Decrease in trade and other receivables 35,485 957,221
Increase in trade and other payables 5,313 34,400
Net cash outflow from operating activities (433,134) 590,211
Cash Flow from investing activities
Exploration expenditure - (13,380)
Acquisition of property, plant and equipment - (1,149)
Investment in subsidiary (142,639) -
Net cash used in investing activities (142,639) (14,529)
Cash flow from financing activities
Related party loans (1,140,613) (2,132,370)
Proceeds from issuance of ordinary shares 375,000 1,850,005
Share issuance costs (42,410) (108,690)
Net cash generated from financing activities (808,023) (391,055)
Net increase in cash and cash equivalents (1,383,796) 184,627
Cash and cash equivalents at the beginning of the year 1,420,801 1,236,174
Cash and cash equivalents at the end of the year 37,005 1,420,801
The notes form part of these financial statements.
.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER
2022
1 Reporting entity
Rockfire Resources plc is a public limited company, quoted on AIM and
incorporated in England and Wales.
2 Adoption of new and revised standards
(i) New and amended standards, and interpretations issued and effective for
the financial year beginning 1 January 2022
The following new standards, amendments and interpretations are effective for
the first time in these financial statements. However, none has had a material
impact on the financial statements:
Standard Effective date
Amendments to IFRS 3: Business Combinations - Reference to the Conceptual 1 January 2022
Framework;
Amendment to IAS 16: Property, Plant and Equipment 1 January 2022
Amendments to IAS 37: Provisions, Contingent Liabilities and Contingent Assets 1 January 2022
Annual Improvements to IFRS Standards 2018-2020 Cycle 1 January 2022
(ii) New standards, amendments and interpretations in issued but not yet
effective
At the date of approval of these financial statements, the following standards
and interpretations which have not been applied in these financial statements
were in issue but not yet effective: (and in some cases not yet adopted by the
UK):
Standard Effective date
Amendments to IAS 1 Presentation of Financial Statements: Classification of 1 January 2023
Liabilities as Current or Non-current
Amendments to IAS 8: Accounting Policies, Changes in Accounting Estimates and 1 January 2023
Errors - Definition of Accounting Estimates;
Deferred Tax relating to Assets and Liabilities arising from a Single 1 January 2023
Transaction (Amendments to IAS 12);
Amendment to IFRS 16 Leases: Lease Liability in a sale & leaseback*. 1 January 2023
* Subject to UK endorsement
The Directors do not expect that the adoption of these standards will have a
material impact on the financial statements of the Group or Company in future
periods.
3 Basis of preparation and significant accounting
policies
a) Basis of preparation
These financial statements have been prepared in accordance with UK-adopted
international accounting standards and with the requirements of the Companies
Act 2006. The Financial statements are prepared under the historical cost
convention as modified by the measurement of certain financial instruments at
fair value.
The preparation of financial statements in conformity with 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 and Company's
accounting policies.
b) Basis of consolidation
Subsidiaries are entities controlled by the Group. Control is achieved when
the Group is exposed, or has rights, to variable returns from its involvement
with the investee and has the ability to affect those returns through its
power over the investee. Specifically, the Group controls an investee if, and
only if, the Group has:
· Power over the investee (i.e., existing rights that give it the
current ability to direct the relevant activities of the investee);
· Exposure, or rights, to variable returns from its involvement
with the investee; and
· The ability to use its power over the investee to affect its
returns.
Generally, when the Group has less than a majority of the voting or similar
rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
· The contractual arrangement(s) with the other vote holders of the
investee;
· Rights arising from other contractual arrangements; and
· The Group's voting rights and potential voting rights.
The Group re-assesses whether or not it controls an investee if facts and
circumstances indicate that there are changes to one or more of the three
elements of control. Subsidiaries are fully consolidated from the date that
control commences until the date that control ceases. Accounting policies of
subsidiaries have been changed where necessary to ensure consistency with the
policies adopted by the Group. Intra-group balances and any unrealised gains
or losses or income or expenses arising from intra-group transactions are
eliminated in preparing the Group financial statements.
c) Functional and presentation currency
These consolidated financial statements are presented in GB pounds sterling
(GBP), which is the Company's functional currency.
d) Going concern
The Company has prepared a cash flow forecast to 30 June 2024 which supports
the Directors' expectation that the Group has adequate resources to continue
in operational existence for a period of not less than 12 months from the date
of signing these financial statements. This cash flow forecast assumes that
the exploration programmes, including minimum expenditure commitments, will
only continue with additional equity funding secured by the Group. This
additional funding is not guaranteed, however, to date the Group has been
successful in securing funding when required. On 17 October 2022, the Company
announced that it had successfully completed a placing of new ordinary shares
in the Company, raising gross proceeds of £375,000, which comprised
240,000,000 new ordinary shares of 0.1 pence each in the Company being placed
with an institutional investor at an issue price of 0.125 pence per share. In
addition, certain Rockfire employees, including several Directors subscribed
for an aggregate of 60,000,000 new ordinary shares at the same issue price. In
total, 300,000,000 new ordinary shares were issued pursuant to the placing. On
1 June 2023, the Company announced that it had raised £880,000, before
expenses, through a placing of 400,000,000 new ordinary shares of 0.1pence
each at a price of 0.22 pence per share. As such, the financial statements
have been prepared assuming the Group and Company will continue as a going
concern.
The Directors believe the Group will generate sufficient working capital and
cash flows to continue in operational existence and will have the ongoing
support of its shareholders, if required, for the foreseeable future.
e) Business combinations
The Group applies the acquisition method in accounting for business
combinations. The consideration transferred by the Group to obtain control of
a subsidiary is calculated as the sum of the acquisition-date fair values of
assets transferred, liabilities incurred, and the equity interests issued by
the Group, which includes the fair value of any asset or liability arising
from a contingent consideration arrangement. Acquisition costs are expensed as
incurred. Assets acquired and liabilities assumed are generally measured at
their acquisition-date fair value.
f) Property, plant and equipment
Items of property, plant and equipment are stated at historical cost less
accumulated depreciation.
Depreciation is provided at the following annual rates in order to write off
each asset over its estimated useful life.
· Motor vehicles
- 20% straight line
· Office equipment
- 25% straight line
· Building improvements
- 10% straight line
The assets' residual values and useful lives are reviewed, and adjusted if
appropriate, at each balance sheet date.
g) Intangible assets - exploration costs
Exploration costs comprise costs associated with the acquisition of mineral
rights and mineral exploration and are capitalised as intangible assets
pending the feasibility of the project. They also include certain
administrative costs that are allocated to the extent that those costs can be
related directly to exploration activities.
If an exploration project is deemed successful based on feasibility studies,
the related expenditure is transferred to development and production assets
and amortised over the estimated useful life of the ore reserves on a unit of
production basis. Where a project is abandoned or considered to be no longer
economically viable, the related costs are written off to profit or loss.
To date, the Group has not progressed to the development and production stage
in any area of operation.
h) Impairment of non-financial assets
The Group assesses at each reporting date whether there is an indication that
an asset may be impaired. If any such indication exists, or when annual
impairment testing for an asset is required, the Group estimates the asset's
recoverable amount. An asset's recoverable amount is the higher of an assets
or cash-generating unit's fair value less costs to sell and its value in use
and is determined for an individual asset, unless the asset does not generate
cash inflows that are largely independent from those of other assets or groups
of assets. Where the carrying value of an asset exceeds its recoverable
amount, the asset is considered impaired and is written down to its
recoverable amount. In assessing value in use, the estimated future cash flows
are 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. In determining fair value less costs to sell, an
appropriate valuation model is used.
Exploration projects at an early stage of development are assessed under the
following areas, in accordance with the criteria contained within IFRS 6, for
circumstances that may indicate the existence of impairment:
· The Group's right to explore in an area has expired, or will
expire in the near future without renewal;
· No further exploration or evaluation is planned or budgeted;
· A decision has been taken by the Board to discontinue exploration
and evaluation in an area due to the absence of a commercial level of
reserves; or
· Sufficient data exists to indicate that the book value will not
be fully recovered from future development.
Impairment losses of continuing operations are recognised in profit or loss in
those expense categories consistent with the function of the impaired asset.
For impaired assets, an assessment is made at each reporting date as to
whether there is any indication that previously recognised impairment losses
may no longer exist or may have decreased. If such indication exists, the
Group makes a revised estimate of recoverable amount. A previously recognised
impairment loss is reversed only if there has been a change in the estimates
used to determine the asset's recoverable amount since the last impairment
loss was recognised. If that is the case the carrying amount of the asset is
increased to its recoverable amount. That increased amount cannot exceed the
carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognised for the asset in prior years.
i) Financial instruments
Financial assets
Classification
The Group classifies its financial assets at amortised cost. Financial assets
do not comprise prepayments. Management determines the classification of its
financial assets at initial recognition. The classification of financial
assets at initial recognition that are debt instruments depends on the
financial asset's contractual cash flow characteristics and the business model
for managing them. In order for a financial asset to be classified and
measured at amortised cost it needs to give rise to cash flows that are solely
payments of principal and interest (SPPI) on the principal amount outstanding.
Amortised cost
The Group's financial assets held at amortised cost comprise trade and other
receivables and cash and cash equivalents in the statement of financial
position. These assets are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. They arise
principally through the provision of goods and services to customers (e.g.,
trade receivables), but also incorporate other types of contractual monetary
asset. They are initially recognised at fair value plus transaction costs that
are directly attributable to their acquisition or issue and are subsequently
carried at amortised cost using the effective interest method, less provision
for impairment.
Impairment of financial assets
An impairment provision is recognised when there is objective evidence of a
default event (e.g., significant financial difficulties on the part of the
counterparty or default or significant delay in payment) such that the Group
may be unable to collect all of the amounts due under the terms receivable,
the amount of such a provision being the difference between the net carrying
amount and the present value of the future expected cash flows associated with
the impaired asset.
Impairment provisions for trade receivables and other receivables are
recognised based on the simplified approach within IFRS 9 using lifetime
expected credit losses (ECLs). During this process the probability of
non-payment of receivables is assessed. This probability is then multiplied by
the amount of expected loss arising from the default to determine the ECL.
Financial liabilities
The Group classifies its financial liabilities in the category of financial
liabilities at amortised cost. All financial liabilities are recognised in the
statement of financial position when the Group becomes a party to the
contractual provision of the instrument. Trade and other payables and
borrowings are included in this category.
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs
incurred. Borrowings are subsequently carried at amortised cost. Any
difference between the proceeds (net of transaction costs) and the redemption
value is recognised in the statement of comprehensive income over the period
of the borrowings using the effective interest method.
Borrowings are de-recognised from the balance sheet when the obligation
specified in the contract is discharged, is cancelled or expires. The
difference between the carrying amount of a financial liability that has been
extinguished or transferred to another party and the consideration paid,
including any non-cash assets transferred or liabilities assumed, is
recognised in profit or loss as other operating income or finance costs.
Borrowings are classified as current liabilities unless the Group has an
unconditional right to defer settlement of the liability for at least 12
months after the reporting period.
Trade and other payables
Trade and other payables are initially recognised at fair value and
subsequently measured at amortised cost using the effective interest method.
Accounts payable are classified as current liabilities if payment is due
within one year or less. If not, they are presented as non-current
liabilities.
j) Provisions
A provision is recognised in the balance sheet when the Group has a present
legal or constructive obligation as a result of a past event, and it is
probable that an outflow of economic benefit will be required to settle the
obligation. If the effect is material, provisions are determined by
discounting the expected future cash flows at a pre-tax rate that reflects the
current market assessment of the time value of money and where appropriate,
the risks specific to the liability.
k) Current and deferred tax
Tax represents the sum of current and deferred tax.
Tax payable or receivable is based on taxable profit or loss for the year.
Taxable profit or loss differs from accounting profit or loss as reported in
the consolidated statement of comprehensive income because it excludes items
of income or expense that are taxable or deductible in other years and further
excludes items that are never taxable or deductible. Current tax is measured
using tax rates that have been enacted or substantively enacted by the
reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit and is accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available, against which
deductible temporary differences can be utilised.
l) Pensions
Pension costs charged in the financial statements represent the contributions
payable by the Group during the year into defined contribution pension
schemes.
m) Foreign currencies
The individual financial statements of each Group entity are presented in the
currency of the primary economic environment in which the entity operates (its
functional currency). For the purpose of the financial statements, the results
and financial position of each entity are expressed in GBP.
In preparing the financial statements of the individual entities, transactions
in currencies other than the entity's functional currency (foreign currencies)
are recorded at the rates of exchange prevailing on the dates of the
transactions. At each balance sheet date, monetary items denominated in
foreign currencies are retranslated at the rates prevailing at the balance
sheet date.
Exchange differences arising on the settlement of monetary items and on the
retranslation of monetary items are included in the statement of comprehensive
income for the period.
For the purpose of presenting consolidated financial statements, the assets
and liabilities of the Group's foreign operations are expressed in GBP using
exchange rates prevailing at the balance sheet date. Income and expense items
are translated at the average exchange rates for the period. Exchange
differences arising, if any, are classified as other comprehensive income and
are transferred to the Group's translation reserve.
When the settlement of a monetary item receivable from or payable to a foreign
operation is neither planned nor likely in the foreseeable future, foreign
currency gains and losses arising from such items are considered to form part
of a net investment in the foreign operation and are recognised in other
comprehensive income and presented in the exchange reserve in equity.
n) Investments
Investments held as non-current assets comprise investments in subsidiary
undertakings and are stated at cost less any provision for impairment.
o) Share capital
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of ordinary shares are recognised as a deduction
from equity, net of any tax effects.
p) Share-based payments
The Group makes equity-settled share-based payments to certain Directors and
employees. Equity-settled share-based payments are measured at fair value at
the date of grant by reference to the fair value of the equity instruments
granted.
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 the number of instruments that will eventually vest
with a corresponding adjustment to equity. 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 effect of
non-transferability, exercise restrictions, and behavioural considerations.
Non-vesting and market vesting conditions are taken into account when
estimating the fair value of the option at grant date. Service and non-market
vesting conditions are taken into account by adjusting the number of options
expected to vest at each reporting date.
q) Critical accounting estimates and judgements
The Group makes estimates and assumptions concerning the future. The resulting
estimates will, by definition, seldom equal the actual results. Estimates and
judgements are continually evaluated and are based on historical experience
and other factors, including expectations of future events that are believed
to be reasonable under the circumstances. Certain amounts included in the
financial statements involve the use of judgement and/or estimation. These
judgements and estimates are based on management's best knowledge of the
relevant facts and circumstances, but actual results may differ from the
amounts included in the financial statements. The Board has considered the
critical accounting estimates and assumptions used in the financial statements
and concluded that the areas of judgement that have the most significant
effect on the amounts recognised in the financial statements are as set out
below.
Recoverability of deferred exploration costs
All costs directly attributable to exploration are capitalised on a project
basis, pending a decision on the economic feasibility of the project. The
capitalisation of such costs gives rise to an intangible asset in the
consolidated and parent company statements of financial position. Exploration
costs are capitalised where it is considered likely that the amount will be
recovered by future exploitation, sale or alternatively where the activities
have not reached a stage which permits a reasonable assessment of the
existence of reserves. This requires management to make estimates and
assumptions as to the future events and circumstances, especially in relation
to whether an economically viable extraction operation can be established.
Such estimates are subject to change and should it become apparent that
recovery of the expenditure is unlikely, the relevant amount is written off in
the statement of comprehensive income.
Receivables from Group undertakings
The Company makes assumptions when implementing the forward-looking ECL model.
This model is used to assess intercompany loans for impairment.
Estimates are made regarding the credit risk and the underlying probability of
default in each of the credit loss scenarios. The scenarios identified by the
Company are production, divestment, fire-sale and failure. The Directors make
judgements on the expected likelihood and outcome of each of the scenarios,
and these expected values are applied to the loan balances.
4 Segmental reporting
During the year, the Group had one business segment which was exploration for
gold and copper resources. Accordingly, no segmental analysis is appropriate.
5 Staff costs
Number of employees
The monthly average number of employees (excluding Directors) of the Group
during the year was:
2022 2021
No. No.
Professional 2 2
Employment costs (excluding directors) 2022 2021
£ £
Wages and salaries 126,531 106,422
Post-employment benefits 8,687 10,363
Total 135,218 116,785
Directors' emoluments
2022
Short-term benefits Post-employment benefits Total
£ £ £
David Price 162,547 16,662 179,209
Gordon Hart 88,699 9,092 97,791
Ian Staunton 31,576 - 31,576
Patrick Elliott 29,540 - 29,540
Nicholas Walley 31,576 - 31,576
Total 343,938 25,754 369,692
2021
Short-term benefits Post-employment benefits Total
£ £ £
David Price 150,000 14,639 164,639
Gordon Hart 79,992 7,985 87,977
Ian Staunton 30,000 - 30,000
Patrick Elliott 28,000 - 28,000
Nicholas Walley 30,731 - 30,731
Total 318,723 22,624 341,347
The key management personnel of the Group are considered to be the Directors.
6 Operating loss
Operating loss is stated after charging:
2022 2021
£ £
Fees payable to the Group auditor for the audit of the Group and Company 27,960 24,750
financial statements
Fees payable to the Group auditor for the taxation services 2,000 1,850
Impairment of intangible assets - 12,334
7 Taxation
2022 2021
£ £
Factors affecting tax charge for the year
Loss on ordinary activities before taxation (753,212) (744,953)
Loss on ordinary activities at the UK standard rate of 19% (2021: 19%) (143,110) (141,541)
Effects of:
UK carried forward losses 95,432 82,253
Non-deductible expenses 45 24,491
Losses of overseas subsidiaries carried forward 47,633 34,797
Current tax charge - -
The Group has estimated UK tax losses of approximately £5,671,000 (2021:
£5,061,000), and losses of overseas subsidiaries approximately £1,153,000
(2021: £863,000) available to carry forward against future trading profits.
The Group has not recognised a deferred tax asset on any losses carried
forward due to the uncertainty of future profits.
8 Earnings per share
2022 2021
£ £
Loss for the purpose of basic and diluted loss per share (753,212) (744,953)
Weighted average number of ordinary shares for the purpose of basic and 1,166,576,254 974,997,979
diluted loss per share
Loss per share - basic and diluted (pence) (0.06) (0.08)
Basic EPS is calculated by dividing the loss attributable to equity holders of
the Company by the weighted average number of ordinary shares in issue during
the year. Diluted EPS is calculated by adjusting the weighted average number
of ordinary shares outstanding to assume conversion of all dilutive potential
ordinary shares. The Company, being loss making in both this year and the
comparative period would mean that any exercise would be anti-dilutive.
9 Intangible assets
Group Exploration costs
£
At 1 January 2021 2,655,196
Additions 918,667
Impairment (12,334)
Foreign exchange differences (113,790)
At 31 December 2021 3,447,739
At 1 January 2022 3,447,739
Additions 459,292
Acquisition 394,530
Foreign exchange differences 149,557
At 31 December 2022 4,451,118
As at 31 December 2022, the Group had future commitments of £6,910,544 (2021:
£9,342,018) in relation to exploration projects:
Rent Minimum
spend
£ £
1 year 7,397 609,993
Later than 1 year but no more than 5 years 486,186 5,806,968
Total 493,583 6,416,961
Company Exploration costs
£
At 1 January 2021 13,380
Additions -
At 31 December 2021 13,380
At 1 January 2022 13,380
Transferred to subsidiary (13,380)
At 31 December 2022 -
10 Property, plant and equipment
Group Motor vehicles Office equipment Building improvements Total
£ £ £ £
Cost
At 1 January 2021 30,445 3,165 - 33,610
Additions - 2,690 - 2,690
Foreign exchange differences (1,468) (178) - (1,646)
At 31 December 2021 28,977 5,677 - 34,654
At 1 January 2022 28,977 5,677 - 34,654
Additions 20,773 3,165 1,065 25,003
Foreign exchange differences 2,247 347 44 2,638
At 31 December 2022 51,997 9,189 1,109 62,295
Depreciation
At 1 January 2021 7,097 807 - 7,904
Charge for the year - 2,619 - 2,619
Depreciation capitalised 4,433 - - 4,433
Foreign exchange differences (417) (74) - (491)
At 31 December 2021 11,113 3,352 - 14,465
At 1 January 2022 11,113 3,352 - 14,465
Charge for the year 534 4,507 - 5,041
Depreciation capitalised 3,637 - - 3,637
Foreign exchange differences 563 266 - 829
At 31 December 2022 15,847 8,125 - 23,972
Net book value
At 31 December 2021 17,864 2,325 - 20,189
At 31 December 2022 36,150 1,064 1,109 38,323
10 Property, plant and equipment (continued)
Company Office equipment Total
£ £
Cost
At 1 January 2021 - -
Additions 1,150 1,150
At 31 December 2021 1,150 1,150
At 1 January 2022 1,150 1,150
Additions - -
At 31 December 2022 1,150 1,150
Depreciation
At 1 January 2021 - -
Charge for the year 460 460
At 31 December 2021 460 460
At 1 January 2022 460 460
Charge for the year 581 581
At 31 December 2022 1,041 1,041
Net book value
At 31 December 2021 690 690
At 31 December 2022 109 109
11 Investments
Company 2022 2021
£ £
At beginning and end of the year 648,000 648,000
Additions in respect of acquisitions 362,147 -
Additional issue of share capital 20,493 -
Total 1,030,640 648,000
On 8 March 2022, Rockfire announced the winning of an Open International
Tender for a 30-year licence to explore and mine the high-grade Molaoi
Zn/Pb/Ag deposit, located in the Hellenic Republic of Greece. Rockfire
participated in the tender under a Memorandum of Understanding with a local
Greek company, Hellenic Minerals IKE, now Hellenic Minerals SA ("Hellenic"),
the applicant in the tender.
On 16 May 2022, the Company acquired 100% of the issued share capital in
Hellenic. Consideration was paid by the Company issuing 50,000,000 new
ordinary shares to the vendors of Hellenic at an issue price of 0.01p and
potential deferred consideration of £400,000 in respect of obtaining a
JORC-compliant mineral resource exceeding four hundred thousand tonnes of zinc
equivalent value. The vendors of Hellenic retain a 2% gross production
royalty on saleable product from all metals extracted from the Molaoi project.
The Company has the option to acquire the gross production royalty for a cash
consideration of £1,000,000 at any time. The following table summarises the
net liabilities acquired, and assumed at the acquisition date:
Fair value
£'s
Trade and other receivables 17,070
Cash and cash equivalents 82,282
Trade and other payables (131,735)
Net liabilities acquired (32,383)
Consideration 362,147
Fair value attributable to exploration assets 394,530
11 Investments (continued)
Additional share capital investment of €24,000 was agreed by the Board on 8
August 2022, in respect of the conversion of Hellenic to an SA company, to
meet the statutory requirements of capital invested per Greek company law.
The Group's subsidiary undertakings at 31 December 2022, were as follows:
Entity name Proportion held Class of shareholding Nature of business Country of incorporation Registered office
Papua Mining Limited 100% Ordinary Dormant British Virgin Islands c/o AA Corporate Management 13, Boulevard Princesse Charlotte, Monte Carlo,
Monaco, MC98000
BGM Investments Pty Limited 100% Ordinary Exploration Australia c/o WSC Group Accountants, 11/800-812 Old Illawarra Road, Menai, NSW 2234,
Australia
Hellenic Minerals SA 100% Ordinary Exploration Greece Philellinon No 9, Alexandroupoli, 68131, Greece.
12 Trade and other receivables
Current 2022 2021
Group £ £
Other receivables 106,171 124,261
2022 2021
Company £ £
Amounts owed by Group undertakings 4,561,444 3,493,473
Other receivables 44,375 79,860
Total 4,605,819 3,573,333
Receivables due from Group undertakings are net of cumulative ECLs of
£704,890 (2021: £618,868). Other receivables comprise prepayments.
Non - Current 2022 2021
Group £ £
Other receivables 85,872 -
The other receivables balance of £85,872 (2021: £Nil) relates to deposits
held in respect of a guarantee given to the Greek Government which expires in
2028.
13 Share capital
Group and Company
Issued share capital 2022 2021
No. No.
Deferred shares of £0.099 each 51,215,534 51,215,534
Ordinary shares of £0.001 each 1,439,739,067 1,082,466,125
Ordinary Shares
2022 2021
Number Number
Allotted, called up and fully paid
At 1 January 1,082,466,125 832,415,592
Issued for cash 300,000,000 246,429,200
Issued in lieu of fees 7,272,942 3,621,333
Issued in asset acquisition 50,000,000 -
At 31 December 1,439,739,067 1,082,466,125
Share Capital
2022 2021
£ £
Allotted, called up and fully paid
At 1 January 7,078,136 6,828,086
Issued for cash(1) 300,000 246,429
Issued in lieu of fees 7,273 3,621
Issued in asset acquisition 50,000 -
At 31 December 7,435,409 7,078,136
(1)In the year ended 31 December 2022 includes issue costs of £42,410 (2021:
£108,690).
The nominal value of the issued share capital includes a cumulative foreign
exchange difference of £925,332 which crystallised in 2017 when the Group's
functional and presentational currency was changed from US$ to GBP.
14 Reserves
Share premium
The share premium account represents amounts subscribed for share capital in
excess of nominal value, net of directly attributable issue costs.
Foreign exchange reserve
Cumulative gains and losses on translating the net assets of overseas
operations to the presentation currency.
Merger relief reserve
The balance on the merger relief reserve represents the fair value of the
consideration given in excess of the nominal value of the ordinary shares
issued as consideration on the acquisition of Hellenic.
Other reserves
Represents the reserve arising from a share for share exchange as part of a
group reorganisation in 2011.
15 Share options and warrants
Share options
2022 2021
Options Weighted Options Weighted
average exercise average exercise
price price
No. £ No. £
Outstanding at 1 January 54,000,000 0.02 18,000,000 0.02
Granted during the year - - 36,000,000 0.02
Lapsed during the year - - - -
Outstanding at 31 December 54,000,000 0.02 54,000,000 0.02
Exercisable at 31 December 54,000,000 0.02 54,000,000 0.02
The weighted average life of the outstanding and exercisable options was 366
days (2021 :2 years and 163 days).
Share options held by Directors were as follows:
2022 2021
No. No.
David Price 10,000,000 10,000,000
Gordon Hart 10,000,000 10,000,000
Ian Staunton 6,000,000 6,000,000
Patrick Elliot 6,000,000 6,000,000
Nicholas Walley 6,000,000 6,000,000
Warrants 2022 2021
Warrants Weighted Warrants Weighted
average exercise average exercise
price price
No. £ No. £
Outstanding at 1 January 30,899,999 0.010 30,899,999 0.010
Lapsed during the year 30,899,999 0.010 - -
Outstanding and exercisable at 31 December - - 30,899,999 0.010
The weighted average life of the outstanding and exercisable warrants at 31
December 2021 was 279 days.
16 Trade and other payables
2022 2021
Group £ £
Trade payables 80,587 47,006
Other payables 22,278 17,128
Accruals 57,209 46,250
Total 160,074 110,384
2022 2021
Company £ £
Trade payables 46,667 46,242
Other payables 20 3,086
Accruals 43,612 35,657
Total 90,299 84,985
17 Financial instruments
In common with other businesses, the Group is exposed to risks that arise from
its use of financial instruments. This note describes the Group's objectives,
policies and processes for managing those risks and the methods used to
measure them. Further quantitative information in respect of these risks is
presented throughout these financial statements.
The significant accounting policies regarding financial instruments are
disclosed in note 3.
The Group does not have any derivative products or any long-term borrowings.
The Group is not exposed to interest-bearing indebtedness. The exploration
activities of the Group are financed by the proceeds of share issues.
Principal financial instruments
The principal financial instruments used by the Group, from which financial
instrument risk arises, are as follows:
2022 2021
Group £ £
Financial assets
Cash and cash equivalents 506,127 1,473,599
Trade and other receivables - -
Total 506,127 1,473,599
Financial liabilities
Trade payables 80,587 47,007
Other payables 22,278 62,650
Total 102,865 109,657
Company
Financial assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 4,605,819 4,112,412
Total 4,642,824 5,533,213
Financial liabilities
Trade payables 46,667 46,242
Other payables 43,632 38,743
Total 90,299 84,985
The Directors consider that the fair value of the above financial instruments
is equal to the carrying values.
General objectives, policies and processes
The Directors have overall responsibility for the determination of the Group's
risk management objectives and policies. The Board regularly reviews the
effectiveness of the processes put in place and the appropriateness of the
objectives and policies it sets.
The overall objective of the Directors is to set policies that reduce risk as
far as possible without unduly affecting the Group's competitiveness and
flexibility.
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. The carrying amount of financial assets represents the maximum
credit exposure. The maximum exposure to credit risk at the reporting date was
as follows:
17 Financial instruments (continued)
2022 2021
Group £ £
Financial assets
Cash and cash equivalents 506,127 1,473,599
Trade and other receivables 106,171 -
Total 612,298 1,473,599
Company
Financial assets
Cash and cash equivalents 37,005 1,420,801
Trade and other receivables 4,605,819 4,112,412
Total 4,642,824 5,533,213
Liquidity risk
Liquidity risk relates to the ability of the Group to meet future obligations
and financial liabilities. To date the Group has relied upon shareholder
funding of its activities. Future exploration and development activities is
dependent upon the Group's ability to obtain further financing through equity
financing or other means.
The following table shows the Group's financial liabilities:
2022 2021
Group £ £
Financial liabilities
Trade payables 80,587 47,006
Other payables 22,278 62,650
Total 102,865 109,656
Company
Financial liabilities
Trade payables 46,667 46,242
Other payables 43,632 38,743
Total 90,299 84,985
The financial statements have been prepared on a going concern basis and note
3(d) provides further information in this regard.
Foreign currency risk
Foreign currency risk refers to the risk that the value of a financial
commitment, recognised asset or liability will fluctuate due to changes in
foreign currency rates.
The Group operates in Australia and Greece. As such the Group is exposed to
transaction foreign exchange risk. The mix of currencies and terms of trade
with its suppliers are such that the Directors believe that the Group's
exposure is minimal and consequently they have not, to date, specifically
sought to hedge that exposure. Most of the Group's funds are in GBP with only
sufficient funds held overseas to meet local costs. The Group and Company's
net exposure to foreign currency risk at the reporting date is as follows:
Group Company
Net foreign currency financial (liabilities)/assets Year Year Year Year
ended 31 December 2022 ended 31 December 2021 ended 31 December 2022 ended 31 December 2021
£ £ £ £
EURO 83,781 - - -
AUD 376,655 69,075 - (2,728)
460,436 69,075 - (2,728)
17 Financial instruments (continued)
Sensitivity analysis
The following table details the impact of changes in foreign exchange rates on
financial assets and liabilities at the balance sheet date, illustrating the
(decrease)/increase in Group operating result caused by a 10 per cent
strengthening of GBP compared to the year-end spot rate. The analysis assumes
that all other variables remain constant.
Profit or loss Equity
Net foreign currency financial Year Year Year Year
(liabilities)/assets ended 31 December 2022 ended 31 December 2021 ended 31 December 2022 ended 31 December 2021
£ £ £ £
Euros (8,378) - (8,378) -
AUD (37,666) (6,907) (37,666) (6,907)
(46,044) (6,907) (46,044) (6,907)
Commodity price risk
Commodity price risk is the risk that the Group's future earnings will be
adversely impacted by changes in the market prices of commodities. The Group
is not currently exposed to commodity price risk, but future revenues will be
determined by reference to market commodity prices.
Capital management
The Group's objectives when managing capital is to maintain its ability to
continue as a going concern in order to provide returns for shareholders and
benefits for other stakeholders and to ensure sufficient resources are
available to meet day to day operating requirements. The Group defines capital
as 'equity' and 'cash' as shown in the consolidated statement of financial
position. As at 31 December 2022 the Group held equity and cash balances of
£4,941,665 and £506,127 (2021: £4,955,405 and £1,473,599), respectively.
The Board takes full responsibility for managing the Group's capital and does
so through Board meetings and reviews of financial information.
The Group's policy is to invest its cash in deposits with high credit worthy
financial institutions with short term maturity.
18 Related party transactions
During the year, the Company advanced funds to BGM Investments Pty Ltd
totalling £570,641 (2021: £1,109,832). The loan is repayable in GBP on
demand and as at 31 December 2022, £3,981,077 (2021: £3,493,473) was
outstanding. A cumulative expected credit loss provision of £704,890 (2021:
£618,869) has been recognised at the year-end in respect of the loan.
During the year, the Company advanced funds to Hellenic totalling £563,635
and transferred exploration costs of £13,380. The loan is repayable in GBP on
demand and as at 31 December 2022, £580,344 was outstanding.
On 16 May 2022, the Company issued 50,000,000 new ordinary shares to the
vendors of Hellenic Minerals as settlement of Tranche 1 of the acquisition
agreement for the Molaoi project in Greece. David Price (or his related party
nominees) was issued 25,000,000 of these new ordinary shares in the Company as
per an historic agreement with the vendors as previously reported. Further
details of the acquisition are set out in note 11.
19 Subsequent events
On 9 January 2023, the Company issued 4,475,758 new ordinary shares to Patrick
Elliott in settlement of Director's fees.
On 20 January 2023, the Company announced that it has entered into a joint
venture arrangement with Sunshine Gold Limited on the Lighthouse and
Kookaburra tenements in Queensland, Australia. Details of the arrangement are
set out in the Chairman's Statement.
19 Subsequent events (continued)
On 1 June 2023, the Company announced that it had raised £880,000, before
expenses, through a subscription of 400,000,000 new ordinary shares of
0.1pence each at a price of 0.22 pence per share.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR UPUMCQUPWGGQRecent news on Rockfire Resources
See all newsREG - Rockfire Resources - NED appointment prepares ROCK for development
AnnouncementREG - Rockfire Resources - Annual Results for the year ended 31 December 2024
AnnouncementREG - Rockfire Resources - Result of General Meeting
AnnouncementREG - Rockfire Resources - Important milestones continue to advance Molaoi
AnnouncementREG - Rockfire Resources - Drilling & mining studies accelerated by Sunshine
Announcement