REG - Starvest PLC - Half-year Report

StarvestAnnouncement

26/05/2021 09:35

RNS Number : 8747Z
  
Starvest PLC
  
26 May 2021
  
 

26 May 2021
 
Half-year report - six months ended 31 March 2021
 
Chairman's statement
Over the six months to 30 March 2021, we continued to experience the economic effects of COVID-19 but thankfully natural resources were very resilient compared to other investment sectors. However, we did note a change in global sentiment from early January 2021 as several commodities, including precious metals, declined in price, which had a marked impact on the near-record-high share price achieved toward the end of 2020. The natural resources sector managed to navigate the situation, and post period end we've continued to see gains. 
 
Starvest's focus on precious metals has meant that it has weathered the period reasonably well and while the Net Asset Value reduced from £17.95m as at 30 September 2020 to £16.72m to 30 March 2021, it has increased more than 250% over the 12 months from 30 March 2020 (NAV £4.66m). This annual increase is mainly due to the performance of our holdings in investee company Greatland Gold plc and, to a lesser extent, Ariana Resources plc. Post period end we have continued to see gains in the Net Asset Value, which was £19.09m as at 30 April 2021.
 
Net Assets, as presented in the Statement of Financial Position in this Half Yearly report, (which differ from the Net Asset Values stated above as Net Assets include provision for deferred taxation and current liabilities) declined from £15.88m as at 30 September 2020 to £14.66m as at 30 March 2021, but increased more than 220% over the 12 months from 30 March 2020 (Net Assets £4.56m).
 
While many sectors have not yet recovered to pre-pandemic levels, the mining sector has made significant gains and is forecast to continue to do so with economic recovery and climate-focused projects at the forefront of government infrastructure spending plans, which we expect will benefit the base and precious metals sectors. Quantitative easing remains a tool of choice for larger global economies and this provides a firm foundation to support the price of precious metals going forward.
 
Continuing to advance its Paterson project, Greatland Gold (LON:GGP) has commenced a box cut to establish a decline at  the Havieron gold-copper deposit which continues to yield many exciting drill results. Growth drilling by operating partners Newcrest Mining is underway which has the potential to significantly increase the resource base at the project. A Pre-Feasibility Study is expected to be delivered in H2 2021. Greatland Gold have also been conducting their own exploration with new programmes commencing recently on the Paterson Juri JV area. In addition, last season's Scallywag drilling has shown strong indications of mineralisation in the area. We look forward to further encouraging news from Greatland Gold, which is well-funded and has an experienced team in place. 
Ariana Resources (LON:AAU) reported robust silver-gold production figures from its Kiziltepe Mine, exceeding guidance for 2020 and making plans to expand its processing plant. Its recent deal with Ozaltin has provided the company with good working capital as well as offering the possibility of future dividends to shareholders following a capital restructure.  
 
Cora Gold (LON:CORA) has recently released exciting results from its latest drill programme at its flagship Sanankoro gold project. This is the start of its largest drill programme to date with up to 35,000m of drilling planned for completion by late July 2021 and the expected announcement of an updated resource statement. 
Kefi Minerals (LON:KEFI) continue with construction of the Tulu Kapi gold mine in Ethiopia and remain on target to start full production in 2022. Kefi has also made significant advances in its exploration of the Hawiah project in Saudi Arabia and has commenced a Pre-Feasibility study of the deposit. 
Other investee companies continue their efforts as well. Oracle Power (LON:ORCP) has expanded its remit and taken up gold exploration in Western Australia. Sunrise Resources (LON:SRES) is advancing its pozzolan-perlite project in Nevada USA towards mine permitting, while Alba (LON:ALBA) is focusing on development of Welsh gold deposits. 
Overall, throughout the past year to 30 March 2021, our strategy to focus on precious metal investments has been successful and resulted in significant increase in value for our overall portfolio. We continue to focus on seeking out value-adding opportunities in the precious metals sector and believe a robust gold price going forward will support current and future strategies. 
 
Callum N Baxter
Chairman & Chief Executive
26 May 2021




 Statement of Comprehensive Income
 







6 months to 31 March 2021


6 months to 31 March 2020


Year ended
 30 September 2020








Unaudited
£


Unaudited
£


Audited
£
 




Administrative expenses


(147,689)


(150,337)


(303,259)




Gain on disposal of financial assets


19,313


22,209


59,146




Amounts written off against financial assets


(1,088,092)


(86,103)


(104,116)




Movement in fair value of financial assets through profit and loss


-


2,747,065


16,097,296




Operating profit


(1,216,468)


2,532,834


15,749,067




Interest receivable


-


20


38




Profit on ordinary activities before tax


(1,216,468)


2,532,854


15,749,105




Tax on profit on ordinary activities


-


-


(2,003,618)




(Loss)/profit attributable to equity holders of the parent 


(1,216,468)


2,532,854


13,745,487






















Earnings per share - see note 3
Basic 
Diluted


 
(2.11) pence
(2.11) pence


 
4.53 pence
4.53 pence


 
24.22 pence
24.22 pence



 




Statement of Financial Position 
 











6 months ended 31 March 2021


6 months ended 31 March 2020


Year ended
 30 September 2020












Unaudited
£


Unaudited
£


Audited
£


























Fixed assets




















Financial assets through profit and loss






16,596,261


4,537,810


17,825,053




Total fixed assets






16,596,261


4,537,810


17,825,053


























Current assets
Trade and other receivables
Cash and cash equivalents


 
 
 


 
29,893
125,344


 
22,738
118,078


 
31,047
120,365




Total current assets






155,237


140,816


151,412


























Current liabilities
Trade and other payables






 
(84,716)


 
(120,672)


 
(93,215)




Total current liabilities






(84,716)


(120,672)


(93,215)


























Non-current liabilities




















Provision for deferred tax






(2,003,618)


-


(2,003,618)




Total non-current liabilities






(2,003,618)


-


(2,003,618)


























Net assets






14,663,164


4,557,954


15,879,632




 
Capital and reserves
Called up share capital
Share premium account
Retained earnings 






 
 
575,740
1,779,414
12,308,010


 
 
559,279
1,686,829
2,311,846


 
 
575,740
1,779,414
13,524,478




Total equity shareholders' funds






14,663,164


4,557,954


15,879,632











 




Statement of Cash Flows
 











6 months ended 31 March 2021


6 months ended 31 March 2020


Year ended
 30 September 2020












Unaudited
£


Unaudited
£


Audited
£


























Cash flows from operating activities




















Operating (loss)/profit






(1,216,468)


2,532,834


15,749,066




Net interest receivable






-


20


38




Shares issued in lieu of fees






-


-


109,046




Increase in investment provisions






1,088,092


86,103


104,116




Movement in fair value of investments






-


(2,747,065)


(16,097,296)




Profit on sale of current asset investments






(19,313)


(22,354)


(59,290)




Decrease/(increase) in debtors






1,154


91,800


83,491




(Decrease)/increase in creditors






(8,499)


54,669


27,212




Net cash used in operating activities






(155,034)


(3,993)


(83,617)


























Cash flows from investing activities




















Purchase of current asset investments






-


-


-




Sale of current asset investments






160,013


61,904


143,815




Net cash generated from investing activities






160,013


61,904


143,815


























Cash flows from financing activities




















Proceeds from issue of shares






-


-


-




Transaction costs of issue of shares






-


-


-




Net cash flows from financing activities






-


-


-


























Net increase in cash and cash equivalents






4,979


57,911


60,198




Cash and cash equivalents at beginning of period






120,365


60,167


60,167




Cash and cash equivalents at end of period






125,344


118,078


120,365

































 




 
Statement of Changes in Equity







Share capital


Share premium


Retained earnings 


Total Equity attributable to shareholders















£


£


£


£





At 30 September 2019


559,279


1,686,829


(221,009)


2,025,099




























Profit for the period


-


-


2,532,854


2,532,854





Total recognised income and expenses for the period


-


-


2,532,854


2,532,854




























Shares issued


-


-


-


-





Total contribution by and distributions to owners


-


-


-


-




























At 31 March 2020


559,279


1,686,829


2,311,845


4,557,953




























Profit for the period


-


-


11,212,633


11,212,633





Total recognised income and expenses for the period


-


-


11,212,633


11,212,633




























Shares issued


16,461


92,585


-


109,046





Total contribution by and distributions to owners


16,461


92,585


-


109,046




























At 30 September 2020


575,740


1,779,414


13,524,478


15,879,632




























Loss for the period 


-


-


(1,216,468)


(1,216,468)





Total recognised income and expenses for the period


-


-


(1,216,468)


(1,216,468)




























Shares issued


-


-


-


-





Total contributions by and distributions to owners


-


-


-


-




























At 31 March 2021


575,740


1,779,414


12,308,010


14,663,164




 




Interim report notes
 
1.   Interim report
The information relating to the six month periods to 31 March 2021 and 31 March 2020 is unaudited.  
The information relating to the year ended 30 September 2020 is extracted from the audited accounts of the Company which have been filed at Companies House and on which the auditors issued an unqualified audit report.
2.   Basis of preparation
This report has been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' ('FRS102'), and with the Companies Act 2006. Although the information included herein does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006, the accounting policies that have been applied are consistent with those adopted for the statutory accounts for the year ended 30 September 2020. 
The Company will report again for the full year to 30 September 2021.
The Company's investments at 31 March 2021 are stated at the lower of cost and net realisable value or the valuation adopted at 30 September 2020 or the current market value based on market quoted prices at the close of business. The Chairman's statement includes a valuation based on market quoted prices at 31 March 2021. 
3.   Earnings per share











6 months ended 31 March 2021


6 months ended 31 March 2020


Year ended
 30 September 2020












Unaudited
£


Unaudited
£


Audited
£


























(Loss)/profit for the year:


(1,216,468)


2,532,854


13,745,487




 
Weighted average number of Ordinary shares of £0.01 in issue


 
57,573,986


 
55,927,832


 
56,742,071




 
Earnings per share - basic and diluted


 
(2.11) pence


 
4.53 pence


 
24.22 pence











 
 
 
 
 
 
 
 
 
 
 
 
 
Investment portfolio
Starvest now holds trade investments in the companies listed below; of these the following companies comprised 99% of the portfolio value as at 31 March 2021:
 



·      Alba Mineral Resources plc


Exploration for oil in England, lead-zinc in Ireland, uranium in Mauritania and graphite in Greenland www.albamineralresources.com




·      Ariana Resources plc


Gold-silver production and exploration in Turkey
www.arianaresources.com




·      Cora Gold Limited


Gold exploration in West Africa
www.coragold.com
 




·      Greatland Gold plc


Gold exploration and development in Australia
www.greatlandgold.com




·      Kefi Minerals plc


Gold and copper exploration and development in Ethiopia and Saudi Arabia
www.kefi-minerals.com




·      Oracle Power plc


Coal development in Pakistan and gold exploration in Australia
www.oraclecoalfields.com



Other investments 
The remaining non-core investments are available for sale when the conditions are deemed to be right:
 



·      Block Energy plc (formerly Goldcrest Resources plc)


Oil and gas exploration in Bulgaria
www.goldcrestresourcesplc.com




·      Minera IRL Limited


Gold exploration in South America
www.minera-irl.com  




·      Sunrise Resources plc


Exploration for industrial minerals in United States, Finland, Australia and Ireland
www.sunriseresourcesplc.com













Other investee companies are listed in the Company's 2020 annual report available on request or from the Company web site - www.starvest.co.uk
Copies of this interim report are available free of charge by application in writing to the Company Secretary at the Company's registered office, Salisbury House, London Wall, London EC2M 5PS, by email to info@starvest.co.uk or from the Company's website - www.starvest.co.uk
 
Enquiries to:
Starvest PLC
Callum Baxter or Gemma Cryan 02077 696 876 or info@starvest.co.uk
Grant Thornton UK LLP (Nomad)
Colin Aaronson, Harrison Clarke or Lukas Girzadas  02073 835 100
SI Capital Ltd (Broker)
Nick Emerson or Alan Gunn 01483 413 500

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