REG - URU Metals Limited - Final Results <Origin Href="QuoteRef">URU.L</Origin> - Part 2
30/09/2015 12:30
- Part 2: For the preceding part double click ID:nRSd7509Aa
Company's consolidated financial statements for the
year ended March 31, 2015.
IAS 36 - Impairment of Assets ("IAS 36")
The IASB issued a narrow-scope amendment to IAS 36. The amendments included
those (i) to require disclosure of the recoverable amount of an asset or
cash-generating unit when an impairment loss has been recognized or reversed
and (ii) to require detailed disclosure of how the fair value less costs of
disposal has been measured when an impairment loss has been recognized or
reversed. At April 1, 2014, the Company adopted this pronouncement and there
was no material impact on the Company's consolidated financial statements for
the year ended March 31, 2015.
(n) New accounting standard issued but not yet effective
IFRS 9 - Financial Instruments: Classification and Measurement ("IFRS 9")
IFRS 9 was issued in November 2009, and will replace IAS 39 - Financial
instruments: Recognition and measurement. IFRS 9 is effective for periods
beginning on or after January 1, 2018. The Company is evaluating the impact of
the amendments on its consolidated financial statements as issued, although
currently they are not expected to have a material impact.
5. Financial instruments
Fair value determination
Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at
the measurement date. The fair value hierarchy establishes three levels to
classify the inputs to valuation techniques used to measure fair value. Level
1 inputs are quoted prices (unadjusted) in active markets for identical assets
or liabilities. Level 2 inputs are quoted prices in markets that are not
active, quoted prices for similar assets or liabilities in active markets,
inputs other than quoted prices that are observable for the asset or
liability, or inputs that are derived principally from or corroborated by
observable market data or other means. Level 3 inputs are unobservable
(supported by little or no market activity). The fair value hierarchy gives
the highest priority to Level 1 inputs and the lowest priority to Level 3
inputs. The Group has no financial instruments carried at fair value as at
March 31, 2015, other than the contingent payment on acquiring SSOAB. This is
a level 3 financial liability as determined based on management's expected
time to settle the obligation.
Financial risk management
The Company's Board of Directors monitors and manages the financial risks
relating to the operations of the Group. These include liquidity risk, credit
risks and market risks which include foreign currency and interest rate
risks.
Credit risk
Credit risk is the risk of loss associated with a counterparty's inability to
fulfill its payment obligations. The Group's credit risk is primarily
attributable to the Group's cash and other receivables. The Group has no
allowance for impairment that might represent an estimate of incurred losses
on other receivables. The Group has cash and cash equivalents of $574,000
(March 31, 2014 - $240,000), which represent the maximum credit exposure on
these assets. As at March 31, 2015, the majority of the cash and cash
equivalents were held with a major Canadian chartered bank from which
management believes the risk of loss to be minimal.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting
the obligations associated with its financial liabilities that are settled by
delivering cash or another financial asset. The Group's approach to managing
liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or risking damage
to the Group's reputation.
Typically the Group tries to ensure that it has sufficient cash on demand to
meet expected operational expenses for a period of twelve months, including
the servicing of financial obligations; this excludes the potential impact of
extreme circumstances that cannot reasonably be predicted. Management monitors
the rolling forecasts of the Group's liquidity reserve on the basis of
expected cash flows.
The following are the contractual maturities of financial liabilities:
Carrying Contractual 6 months 2-5
amount cash flows or less years
March 31, 2015
Trade and other payables $ 379 $ 379 $ 379 $ -
Contingent consideration 142 221 - 221
March 31, 2014
Trade and other payables $ 301 $ 301 $ 301 $ -
Contingent consideration 160 221 - 221
Market risks
Market risk is the risk that changes in market prices, such as foreign
exchange rates, interest rates and equity prices will affect the Group's
income or the value of its holdings of financial instruments. The objective of
market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return. The Company does not apply
hedge accounting in order to manage volatility in statements of loss.
Foreign currency rate risk
The Group, operating internationally, is exposed to currency risk on purchases
that are denominated in a currency other than the functional currency of the
Group's entities, primarily Pound Sterling (GBP), the Canadian Dollar (CAD),
the Central African Franc (CFA), the South African Rand (ZAR), and the US
Dollar (USD).
The Group does not hedge its exposure to currency risk.
In respect of other monetary assets and liabilities denominated in foreign
currencies, the Group's policy is to ensure that its net exposure is kept to
an acceptable level by buying or selling foreign currencies at spot rates when
necessary to address short term imbalances.
The Group's exposure to foreign currency risk, based on notional amounts, was
as follows:
Franc
USD GBP ZAR CFA SEK CAD Total
March 31, 2015
Cash $ 17 $ 537 $ - $ - $ 5 $ 15 $ 574
Deposits, prepaid and receivables - - - - 2 - 2
Trade and other payable - (136 ) - - (13 ) (230 ) (379 )
Contingent consideration (142 ) - - - - - (142 )
March 31, 2014
Cash $ 9 $ 223 $ - $ 1 $ 5 $ 2 $ 240
Deposits, prepaid and receivables 64 25 - - 12 15 116
Trade and other payable (1 ) (104 ) (75 ) - (39 ) (82 ) (301 )
Contingent consideration (160 ) - - - - - (160 )
Interest rate risk
The financial assets and liabilities of the Group are subject to interest rate
risk, based on changes in the prevailing interest rate. The Group does not
enter into interest rate swap or derivative contracts. The primary goal of the
Group's investment strategy is to make timely investments in listed or
unlisted mining and mineral development properties to optimise shareholder
value. Where appropriate, the Group will act as an active investor and will
strive to advance corporate actions that deliver value adding outcomes. The
Group will undertake joint ventures with companies that have the potential to
realize value through mineral project development, and invest substantially in
those joint ventures to advance asset development over the near term.
Sensitivity analysis
A 10% strengthening of the US Dollar against the following currencies at March
31, 2015 would have increased/(decreased) equity and profit or loss by the
amounts shown below. This was determined by recalculating the USD balances
held using a 10% greater exchange rate to the US Dollar. This analysis assumes
that all other variables, in particular interest rates, remain constant.
March 31, 2015 March 31, 2014
Equity Profit or loss Equity Profit or loss
GBP $ - $ (40 ) $ - $ (4 )
ZAR $ - $ - $ - $ (1 )
CAD $ - $ 28 $ - $ (9 )
SEK $ - $ 3 $ - $ -
6. Capital risk management
The Company includes its share capital and premium, reserves and accumulated
deficit as capital. The Company's objective is to maintain a flexible capital
structure which optimizes the costs of capital at an acceptable risk. In light
of economic changes and with the risk characteristics of the underlying
assets, the Company manages the capital structure and makes adjustments to it.
As the Company has no cash flow from operations and in order to maintain or
adjust the capital structure, the Company may attempt to issue new shares,
issue debt and/or find a strategic partner. Neither the Company nor any of its
subsidiaries are subject to externally imposed capital requirements.
The Company prepares annual expenditure budgets to facilitate the management
of its capital requirements and updates them as necessary depending on various
factors such as capital deployment and general industry conditions. The
Company's investment policy is in highly liquid, short-term interest-bearing
investments with short maturities. During the year ended March 31, 2015, there
were no changes in the Company's approach to capital management.
7. Disposed investments and discontinued operations
(a) Sale of UrAmerica
On 4 April 2013, the Company elected to sell its entire holdings (4,421,000
shares) in UrAmerica, an Argentina-based private uranium exploration company,
for GBP 200,000, resulting in a gain of USD 292,000. This investment had
previously been written off in the consolidated financial statements.
(b) Decision to close the Niger Operations
The closure of the Niger operations was effective September 30, 2013 and have
been treated as a discontinued operation in the consolidated financial
statements.
The consolidated financial statements have been updated for the discontinued
operations for the following amounts:
Year ended
March 31,
2014
Operating expenses $ 178
Loss on disposal of assets 5
Total loss and comprehensive loss for the period from discontinued
operations $ 183
Cash flows from discontinued operations
Used in operations $ (178 )
Change in working capital (33 )
$ (211 )
Assets and liabilities of discontinued operations
As at
March 31,
2014
Cash $ 1
Total assets of discontinued operations $ 1
8. Purchase of Svenska Skifferoljeaktiebolaget ("SSOAB")
On 23 May, 2013, the Company announced that it had acquired all the
outstanding ordinary shares of a Swedish company, Svenska
Skifferoljeaktiebolaget ("SSOAB") from a private company. The acquisition was
made to obtain SSOAB's only significant assets: its title to six exploration
licenses in Sweden, located in Örebro County.
URU paid the vendors USD 300,000 and issued 17 million ordinary shares as
consideration to the vendors for the purchase of SSOAB. Of these shares, 15
million are restricted subject to a lock-in agreement which have yet to be
released. An additional 2.5 million ordinary shares, plus a cash payment of
USD 25,000, were paid as a finder's fee on the transaction. A deferred payment
of USD 200,000 will be paid by URU to the vendors upon the completion of the
first exploration drill programme on the property in the future. The agreement
has not specified a drilling timetable at the time of acquisition;
management's best estimate was that it would be on or about three years after
acquisition (i.e. May 2016), although the drilling would be contingent on the
Group's cash position. Coincident with the deferred payment will be a return
to the purchasers of cash and equivalents in the company at transfer of SEK
132,000 (USD 21,000 at date of purchase). The payment terms offer a reduction
to the extent of any claims for pre-acquisition liabilities not previously
disclosed by the seller and identified by URU within one year of purchase,
provided that any one claim is greater than USD 10,000 and the claims in
aggregate are greater than USD 100,000.
The contingent consideration of USD 221,000 (comprising a purchase cost of USD
200,000 plus a return of assets of USD 21,000) has been discounted and
recognized at fair value of USD 141,000 at issue, and will be remeasured to
fair value at each reporting date:
As at As at
March 31, March 31,
(in thousands of US dollars) 2015 2014
Opening balance $ 160 $ -
Amount recognized - 141
Accretion 29 19
Gain on fair value adjustment (43 ) -
Foreign exchange (4 ) -
Closing balance $ 142 $ 160
As the Company owns all of SSOAB's outstanding ordinary shares, the Company
has control over SSOAB as defined in IFRS 10, Consolidation. However, the
Group has treated the transaction as a purchase of assets, as SSOAB does not
meet the definition of a "business" as set out in IFRS 3, Business
Combination. As it was not a business combination, transaction costs have been
capitalised, and, as the transaction affected neither accounting nor taxable
profit, deferred taxes do not arise.
The following table summarises the consideration paid for SSOAB, and the
amounts of the assets acquired at the acquisition date (in thousands of US
dollars):
Consideration USD '000s
Cash $ 300
Cash-based acquisition costs 161
Total cash-based costs 461
Shares issued to vendor 582
Shares issued as part of acquisition costs 85
Contingent consideration 141
$ 1,269
Identifiable net assets acquired
Exploration licenses $ 1,269
$ 1,269
9. Purchase of Southern Africa Nickel Limited ("SAN Ltd")
On 25 November 2013, the Company announced that it had acquired all the
outstanding ordinary shares of SAN Ltd, a private company incorporated in the
BVI, from two private companies.
The acquisition was the first of a two-part plan to gain control of SAN Ltd's
interests in various mineral prospecting rights in South Africa. SAN Ltd had
been party to two joint ventures in South Africa: a putative 74% interest in
the Zebediela licenses, and, in a 50/50 ownership with URU, a 50% interest in
the Burgersfort project. The terms of the purchase agreement stipulated that
URU's joint venture with SAN Ltd would be terminated upon purchase. As a
result, URU now owns 100% of SAN Ltd, which in turn owns a putative 74%
interest in the Zebediela licenses and a 50% interest in the Burgersfort
project. The dispute between SAN Ltd and the holders of the Zebediela licenses
was terminated after year-end with the completion of the second part of the
plan, which is set out in Note 10.
URU paid consideration of USD 218,000, consisting of ZAR 1,907,977 (USD
187,000) to one of SAN Ltd's debtors, plus an additional USD 34,000 in
purchase costs.
As the Company owns all of SAN Ltd's outstanding ordinary shares, the Company
has control over SAN Ltd as defined in IFRS 10, Consolidation. However, the
Group has treated the transaction as a purchase of assets as SAN Ltd does not
meet the definition of a "business" as set out in IFRS 3, Business
Combination. As it was not a business combination, transaction costs have been
capitalised, and, as the transaction affected neither accounting nor taxable
profit, deferred taxes do not arise.
The following table summarises the consideration paid for SAN Ltd, and the
preliminary allocation to the assets acquired at the acquisition date:
Consideration USD '000s
Cash $ 184
Cash-based acquisition costs 34
Total consideration $ 218
Receivable from former owner $ 9
Exploration licenses 209
Recognized amounts of identifiable assets assumed $ 218
10. Purchase of Umnex Minerals Limpopo Pty ("UML")
In November 2013, the Company acquired 100% interest in SAN Ltd. SAN Ltd in
turn had a 74% interest in a joint operation (the "SAN-Umnex Joint Venture").
The remaining 26% was held by Umnex Mineral Holdings Pty ("UMH"), which had
putative title to the Zebediela licenses through its subsidiary, Umnex
Minerals Limpopo Pty ("UML"). SAN Ltd and UMH had been in dispute since 2011,
and arbitration had begun in August 2013. As a result of this arbitration, in
fiscal 2013 the Company had provided in full for the costs of the Zebediela
project (USD 1,821,000). The reversal of the impairment will be assessed once
the title to the licences has been completely transferred to the Group.
On April 10, 2014, SAN Ltd. and UMH agreed that SAN Ltd. would purchase 100%
of UML from UMH for consideration of 33,194,181 in new URU shares and
8,000,000 bonus shares issued to directors and officers for their services in
the acquisition of UML.
The Zebediela Nickel Project extends over three separate mining titles in
Limpopo Province. As at the date of acquisition, title to all three rights
were held by parties unrelated to UML, and transfer of the rights to UML's
subsidiary Lesogo Platinum Uitloop Pty ("LPU") had not been completed. The
timing of the transfer is uncertain and regulatory approval of the transfer
remains outstanding.
Under the terms of the acquisition agreement, UMH is permitted to return the
shares and take back the licences should URU:
· fail to maintain adequate cash funds to meet its general and project
expenditure obligations, or
· fail to meet the purchased rights' minimum statutory expenditure
obligations, or
· raise equity capital at a valuation of below 1.5 pence per share
As at March 31, 2015, the "general and project expenditure obligations" and
the "minimum statutory expenditure obligations" of the general and project
expenditure obligations has not been determined.
As the Company owns all of UML's outstanding ordinary shares, the Company has
control over UML as defined in IFRS 10, Consolidation. However, as UML does
not meet the definition of a "business" as set out in IFRS 3, the Company has
treated the transaction as a purchase of assets. As it was not a business
combination, transaction costs have been capitalized, and as the transaction
affected neither accounting nor taxable profit, deferred taxes do not arise.
The following table summarises the assessment of consideration paid for UML
and the amounts of assets acquired at the acquisition date:
Consideration USD '000s
Value of shares issued $ 996
Value of bonus shares issued 226
Cash-based acquisition costs 126
$ 1,348
Identifiable net assets acquired
Intangible assets $ 1,348
$ 1,348
Of the consideration paid, USD95,000 was incurred and capitalized to
intangible assets in the year ended March 31, 2014.
Additionally, conditional consideration of 12,000,000 free-trading shares is
payable if either 1) a transaction is consummated by URU to sell, farm-out, or
similarly dispose of any portion of a mineral project on some or all of the
mining titles, or 2) a mining right is obtained from the South African
Department of Mines and Resources in respect of some or all of the rights, or
3) an effective change of control of URU occurs. As at March 31, 2015, none of
the above conditions have occurred.
11. Plant and equipment
(In thousands of United States Dollars)
Exploration Computer
COST Plant and equipment equipment Total
Balance, March 31, 2013 $ 29 $ 7 $ 36
Additions 21 - 21
Balance, March 31, 2014 50 7 57
Impairment of assets (50 ) - (50 )
Balance, March 31, 2015 $ - $ 7 $ 7
Exploration Computer
ACCUMULATED DEPRECIATION Plant and equipment equipment Total
Balance, March 31, 2013 $ 23 $ 6 $ 29
Depreciation for the year 8 - 8
Balance, March 31, 2014 31 6 37
Depreciation for the year 7 1 8
Impairment of assets (38 ) - (38 )
Balance, March 31, 2015 $ - $ 7 $ 7
Exploration Computer
CARRYING AMOUNTS Plant and equipment equipment Total
At March 31, 2014 $ 19 $ 1 $ 20
At March 31, 2015 $ - $ - $ -
During the year ended March 31, 2015, the Group wrote off the exploration
plant and equipment related to Nueltin as the Group has no plan to pursue the
project in Nunavut Territory (see note 12).
12. Intangible assets
(In thousands of United States Dollars)
Exploration costs
South African
COST Projects SSOAB Nueltin Total
Balance, March 31, 2013 $ 3,872 $ - $ - $ 3,872
Acquired (note 10) (i) 209 1,269 - 1,478
Foreign exchange (228 ) 36 - (192 )
Additions 123 133 175 431
Balance, March 31, 2014 3,976 1,438 175 5,589
Acquired (note 10) (i) 1,254 - - 1,254
Foreign exchange (440 ) (453 ) (22 ) (915 )
Additions 5 111 - 116
Impairment - - (153 ) (153 )
Balance, March 31, 2015 $ 4,795 $ 1,096 $ - $ 5,891
ACCUMULATED AMORTIZATION South African
AND IMPAIRMENT Projects SSOAB Nueltin Total
Balance, March 31, 2013 $ (2,345 ) $ - $ - $ (2,345 )
Foreign exchange 257 - - 257
Balance, March 31, 2014 (2,088 ) - - (2,088 )
Foreign exchange 236 - - 236
Balance, March 31, 2015 $ (1,852 ) $ - $ - $ (1,852 )
South African
CARRYING VALUE Projects SSOAB Nueltin Total
At March 31, 2014 $ 1,802 $ 1,438 $ 175 $ 3,415
At March 31, 2015 $ 2,943 $ 1,096 $ - $ 4,039
(i) The intangible assets acquired from UML were capitalized as additions to
South African Projects.
NUSA Licenses
All of the Niger exploration licences were acquired from NWT Uranium
Corporation ("NWT") and UraMin Inc. as part of the asset purchase agreement
when URU Metals Limited was formed. All the Niger licenses are considered to
be a single project, and thus to be one Cash Generating Unit (CGU).
In fiscal 2014, the licenses were returned and the Group's operations in Niger
were closed, and the latter are thus set out in Note 7, Disposed investments
and discontinued operations.
SSOAB Licenses
SSOAB has 100% ownership of several exploration licenses near the town of
Örebro, Sweden. The Swedish licenses are considered to be a single project,
and thus to be one CGU.
Nueltin License
Nueltin is party to an option agreement with Cameco Corporation, the holder of
license located in the Nunavut Territory of Canada. Under the agreement, the
Group can earn 51% interest in the project from Cameco in return for
exclusively funding CDN$2.5 million in exploration expenditures by December
31, 2016. The Cameco project is considered to be one CGU. During the year
ended March 31, 2015, the Group wrote-off the Nueltin License for an amount
$153 as the Group has no plan to pursue the project in Nunavut Territory.
South African Projects
On 5 October 2010, the Group announced that it had entered into a joint
venture (the "SAN-URU Joint Venture") with SAN Ltd, the joint owner and
current developer of a portfolio of large nickel projects in Southern Africa.
Under the agreement, the Group committed to provide funding to the SAN-URU
Joint Venture of, in aggregate, up to USD 3.6 million over a period of 20
months from 5 October 2010. The SAN-URU Joint Venture's interests included a
50% interest in a joint arrangement to explore mineral rights near the town of
Burgersfort in South Africa (the "Burgersfort Project") as well as the
Zebediela Nickel Project as noted below.
On 6 April 2011 the Group announced the satisfactory and successful conclusion
of all due diligence activities between SAN Ltd and Umnex Mineral Holdings Pty
("Umnex"), in relation to the acquisition of the Zebediela Nickel Project
close to the mining town of Mokopane in the Limpopo province of South Africa.
The Zebediela project is a joint venture, structured exclusively between SAN
Ltd and Umnex (the "SAN-Umnex Joint Venture", i.e. not to be confused with the
SAN-URU Joint Venture). The acquisition of an interest in the Zebediela rights
via the SAN-Umnex Joint Venture involved no additional cash consideration to
be made by either the Group or SAN and did not increase the Group's original
committed contribution to the SAN-URU Joint Venture of USD 3.6 million.
In fiscal 2012, URU Metals satisfied all its obligations under the SAN-URU
Joint Venture Agreement and thus had a fully vested 50% interest in the
SAN-URU Joint Venture. However, as announced on 6 April 2011, the SAN-URU
Joint Venture sought to continue the development of the Zebediela Nickel
Project. Umnex, the vendor of the Zebediela Nickel Project, would receive a
direct interest in the SAN-URU Joint Venture from both Southern African Nickel
and URU Metals. Subsequent to that direct investment - and assuming that the
arbitration (see below) was to have ruled in SAN's favour - the effective
interest of each party in the SAN-URU Joint Venture would have been URU Metals
45%, SAN 40%, and Umnex 15%.
In fiscal 2013, a dispute arose between SAN and Umnex. Both parties alleged
that the other party had failed in its obligations under their SAN-Umnex Joint
Venture agreement. Primarily, Umnex alleged that SAN has failed in its
obligation to achieve a public listing for the SAN-Umnex Joint Venture by July
6, 2012, and thus Umnex had the ability to leave the Joint Venture with
ownership of the mineral rights in exchange for payment of historical
exploration costs, whereas SAN Ltd alleged that Umnex had not facilitated the
required transfer of the mineral license into the correct corporate vehicle
first, which was necessary to allow the public listing to proceed. URU's
interest in the Zebediela project was negotiated as an amendment to the
SAN-URU Joint Venture; URU was never party to the dispute between SAN Ltd and
Umnex. As at 31 March 2013, URU had fulfilled all of its obligations under
that separate agreement. URU was in active discussions between Umnex and SAN
Ltd to facilitate a resolution to the dispute. Unfortunately, discussion
through to the end of calendar 2012 failed to resolve the dispute between
Umnex and SAN Ltd, such that those two partners entered into a formal
arbitration process.
URU acquired 100% of the shares of SAN Ltd in November 2013 as set out in Note
10.
The arbitration was ultimately settled as a condition of URU's acquisition in
April 2014 of the Umnex subsidiary which held the Zebediela licenses.
Accounting Treatment of SAN-URU Joint Venture (the Burgersfort properties).
With URU's acquisition of SAN Ltd at year-end, the SAN-URU Joint Venture was
dissolved, and SAN Ltd obtained ownership of the JV's 50% interest in the
Burgersfort properties. SAN Ltd's interest in the Burgersfort properties is a
Joint Operation, as set out in IFRS 11, Joint Arrangements, with BSC Resources
as the other party to the arrangement. Any disputes not resolved by management
of SAN Ltd and its joint venture partner must go to arbitration, i.e. joint
control over a contractual agreement.
Accounting Treatment of SAN-Umnex Joint Venture (the Zebediela properties)
The original agreement intended that SAN Ltd would have 74% ownership of the
final agreement. Accordingly, at March 31, 2014, SAN Ltd's interest in
Zebediela remained a Farm-in Agreement, and the Company capitalised 100% of
the costs it incurred in relation to the SAN-Umnex Joint Venture to the extent
that the costs were directly related to exploration and evaluation
activities.
On April 10, 2014, SAN Ltd. and UMH agreed that SAN Ltd. would purchase 100%
of UML from UMH for consideration (see note 10), thereby dissolving the
SAN-Umnex Joint Venture.
13. Receivables
(In thousands of United States Dollars)
As at As at
March 31, March 31,
2015 2014
Deposits $ - $ 63
Other prepayments - 19
Other receivables 2 30
Payroll withholding taxes recoverable from directors - 4
$ 2 $ 116
14. Share capital and premium
(In thousands of United States Dollars except number of shares)
Number of
shares Share capital Share premium Total
Balance, March 31, 2013 113,276,722 $ 1,133 $ 45,724 $ 46,857
Shares issued to purchase SSOAB (i) 19,500,000 195 472 667
Balance, March 31, 2014 132,776,722 $ 1,328 $ 46,196 $ 47,524
Shares issued for acquisition of UML (note 10) 41,194,181 412 810 1,222
Shares issued in private placement (ii) 54,333,334 543 831 1,374
Shares issued for professional service (iii) 656,142 7 7 14
Transaction costs incurred for private placement - - (184 ) (184 )
Balance, March 31, 2015 228,960,379 $ 2,290 $ 47,660 $ 49,950
Issued shares
All issued shares are fully paid up.
(i) Of these shares, 15 million are restricted subject to a lock-in
agreement.
(ii) On May 2, 2014, the Company announced the placing of 54,333,334 new
shares at a price of 1.5 pence per share for a total of GBP 815,000. Of the
total, 19,283,335 shares were issued to Niketo Co. Ltd., a company wholly
owned by NWT Uranium Corp.("NWT"), the Company's largest shareholder.
8,500,000 of these share were issued in settlement of professional fees owed.
(iii) During the year ended March 31, 2015, the Company issued 656,142 shares
to RB Milestone, a consultant, for settlement of professional services
privided with a total value of $14.
Unissued shares
In terms of the BVI Business Companies Act, the unissued shares are under the
control of the Directors.
Dividends
Dividends declared and paid by the Company were $nil for the year ended March
31, 2015 (2014 - $nil)
15. Share option reserve
(a) Share options
The Share Option Plan is administered by the Board of Directors, which
determines individual eligibility under the plan for optioning to each
individual. Below is disclosure of the movement of the Group's share options
as well as a reconciliation of the number and weighted average exercise price
of the Group's share options outstanding on March 31, 2015.
The assessed fair value at grant date is determined using the Black-Scholes
Model that takes into account the exercise price, the term of the option, the
share price at grant date, the expected price volatility of the underlying
share, the expected dividend yield and the risk-free interest rate for the
term of the option.
(i) Reconciliation of share options outstanding as at March 31,
2015:
Weighted Number of
average options originally Number
Exercise prices (GBP) remaining life (years) granted exercisable
0.034 0.91 2,000,000 2,000,000
0.049 5.56 2,633,334 2,633,334
0.020 2.15 8,500,000 8,500,000
0.032 2.64 13,133,334 13,133,334
(ii) Continuity and exercise price
The number and weighted average exercise prices of share options are as
follows:
Weighted
average
Number exercise price
of options per share (GBP)
Balance, March 31, 2013 11,483,334 $ 0.05
Options expired unexercised (4,000,000 ) 0.05
Balance, March 31, 2014 7,483,334 0.04
Options granted 8,500,000 0.02
Options expired unexercised (2,850,000 ) 0.05
Balance, March 31, 2015 13,133,334 $ 0.03
On May 22, 2014, the Company granted a total of 8,500,000 options to directors
and contractors at an exercise price of GBP0.02 per share. The options granted
vested immediately upon grant. The fair value of share options granted was
$98,067 (GBP58,319) which was expensed during the year ended March 31, 2015.
The fair value of these share options was calculated using the Black Scholes
model with the following assumptions:
Risk-free interest rate 1.04%
Expected life (years) 3.0
Expected volatility 49.62%
Dividend yield per share Nil
Exercise price GBP0.02
Share price GBP0.02
(b) Warrant
The following is a summary of the Company`s warrant granted under its Share
Incentive Scheme. As at March 31, 2015, the following warrant, issued in
respect of capital raising, had been granted but not exercised:
Number of Exercise Expiry Fair value at
Name Date granted Date vested warrants price (GBP) date grant date (GBP)
Beaumont October 9, 2009 October 9, 2009 100,000 0.345 October 9, 2019 0.345
There were no movements in warrant during the year ended March 31, 2014 or
during the year ended March 31, 2013.
16. Trade and other payables
(In thousands of United States Dollars)
As at As at
March 31, March 31,
2015 2014
Other payables $ 105 $ 3
Accruals 274 298
$ 379 $ 301
17. Related party transactions
(a) Transactions with key management personnel
During the year ended March 31, 2015, stock options of 8,000,000 were granted
to officers and directors of the Company (2014 - nil) at an exercise price of
GBP 0.02 per share.
Details of stock options outstanding granted to directors, management and past
directors and management are as follow:
Weighted Number of
average options originally Expiry
Directors/officers exercise price (GBP) granted date
Directors
J. Vieira 0.034 1,000,000 February 27, 2016
J. Vieira 0.02 2,000,000 May 23, 2017
D. Subotic 0.034 1,000,000 February 27, 2016
D. Subotic 0.02 3,000,000 May 23, 2017
Management
J. Zorbas 0.02 3,000,000 May 23, 2017
10,000,000
The former Chief Executive Officer and director R. Lemaitre and former Chief
Financial Officer, R. Swarts resigned during the prior two years and the Board
of Directors confirmed that their options remained in force until they expire
or are unexercised.
(b) Management remuneration
(In thousands of United States Dollars)
For the years ended March 31, 2015 2014
Fees for services as director $ 45 $ 50
Basic salary 114 163
Share-based payments 92 11
Total $ 251 $ 224
18. Loss before income tax
The following items have been charged in arriving at the operating loss for
the year:
(In thousands of United States Dollars)
March 31, March 31,
Note 2015 2014
Auditors' remuneration $ 96 $ 70
Directors' fees 45 51
Legal fees 21 49
Operating lease payments 62 96
Depreciation 7 7
Foreign exchange loss(gain)
Realized 53 (80 )
Unrealized (73 ) 22
Staff remuneration
Share options expensed - Directors (equity settled) 15a 98 11
Share options expensed - Current and former staff (equity settled) 15a - 7
Share options expensed - salaries 115 303
Other professional fees 192 119
19. Income tax expense and deferred taxation
The Company is incorporated in the British Virgin Islands (BVI). The BVI under
the Business Companies Act (BCA) imposes no corporate or capital gains taxes.
As such, the Company's losses will not result in an income tax recovery in the
BVI. However, the Company as a Group may be liable for taxes in the
jurisdictions where it operates or develops mining properties.
Effective 13 July 2012, the Company became resident in Canada, and is subject
to income taxes at a combined federal and provincial statutory tax rate of
26.5% (2014 - 26.5%).
Income tax expense from the amount that would be computed by applying the
Canadian federal and provincial statutory income tax rates to the loss for the
year is as follows:
2015 2014
Loss for the year before taxes $ (1,129 ) $ (388 )
Statutory tax rate 26.5% 26.5%
Expected income tax recovery (299 ) (103 )
Non-deductible/non-taxable items 26 (54 )
Benefit of losses not recognized 273 157
- -
No deferred tax asset has been recognised because there is insufficient
evidence of the timing of suitable future profits against which it can be
recovered. No deferred tax liability has been recognised as a result of the
losses in the periods to date.
The significant components of the Company's unrecognized deductible temporary
differences as at March 31, 2015 and 2014 are as follows:
2015 2014
Loss carry-forward $ 9,098 $ 8,220
Share issuance costs 25 -
Subtotal $ 9,123 $ 8,220
The group has non-capital losses in Canada of USD 878,000 expiring in 2035,
USD 575,000 expiring in 2034 and USD 7,645,000 expiring in 2033.
20. Segmented information
(a) Reportable segments
The Group has two reportable segments, as described below, which are the
Group's strategic business units. Both are determined by the CEO, the Group's
chief operating decision-maker, and have not changed year-over-year. The
strategic business units offer different services, and are managed separately
because they require different strategies.
The following summary describes the operations in each of the Group's
reportable segments:
Exploration - Includes obtaining licenses and exploring these license areas.
Corporate office - Includes all Group administration and procurement
There are no other operations that meet any of the quantitative thresholds for
determining reportable segments in 2015 or 2014.
There are varying levels of integration between the Exploration and Corporate
Office reportable segments. This integration includes shared administration
and procurement services. The accounting policies of the reportable segments
are the same as described in Notes 3 and 4.
Information regarding the results of each reportable segment is included
below. Performance is measured based on segmented results. Any inter-segment
transactions would be determined on an arm's length basis. Inter-segment
pricing for 2015 and 2014 consisted of funding advanced from Corporate Office
to Exploration.
(b) Operating segments
Exploration Corporate office Total
2015 2014 2015 2014 2015 2014
Depreciation $ 7 $ 2 $ 1 $ 5 $ 8 $ 7
Reportable segment profit (loss) before tax for:
continuing operations $ (139 ) $ - $ (990 ) $ (388 ) $ (1,129 ) $ (388 )
discontinued operations $ - $ (183 ) $ - $ - $ - $ (183 )
Material non-cash items in segment loss before tax:
Share-based payments expenses - $ - $ 98 $ 18 $ 98 $ 18
Reportable segment assets $ 4,049 $ 3,468 $ 566 $ 324 $ 4,615 $ 3,792
Capital expenditures $ - $ 20 $ - $ - $ - $ 20
Additions to mineral properties $ 116 $ 1,909 $ - $ - $ 116 $ 1,909
Reportable segment liabilities $ (144 ) $ (15 ) $ (377 ) $ (446 ) $ (521 ) $ (461 )
(c) Geographical segments
During the year ended March 31, 2015, business activities took place in
Sweden, Canada and South Africa and during the year ended March 31, 2014,
business activities took place in Sweden, Canada, South Africa and Niger.
In presenting information based on the geographical segments, segment assets
are based on the geographical location of the assets.
The following table presents segmented information on the Company's operations
and net loss for the year ended March 31, 2015 and assets and liabilities as
at March 31, 2015:
(In thousands of United States Dollars)
Canada Sweden South Africa Total
Net loss $ 1,162 $ (33 ) $ - $ 1,129
Depreciation $ 8 $ - $ - $ 8
Share-based payments $ 98 $ - $ - $ 98
Total assets $ 566 $ 1,106 $ 2,943 $ 4,615
Non-current assets $ - $ 1,084 $ 2,955 $ 4,039
Liabilities $ (377 ) $ (144 ) $ - $ (521 )
The following table presents segmented information on the Company's operations
and net loss for the year ended March 31, 2014 and assets and liabilities as
at March 31, 2014:
(In thousands of United States Dollars)
Canada Sweden South Africa Niger Total
Net loss $ 388 $ - $ - $ 183 $ 571
Depreciation $ 6 $ - $ - $ 1 $ 7
Share-based payments $ 18 $ - $ - $ - $ 18
Total assets $ 423 $ 1,426 $ 1,942 $ 1 $ 3,792
Non-current assets $ 195 $ 1,438 $ 1,802 $ - $ 3,435
Liabilities $ (446 ) $ - $ - $ (15 ) $ (461 )
21. Commitment
In February 2014, the Company signed a lease agreement with its majority
shareholder, NWT, based on the square footage it uses in NWT's office space.
The monthly rent is CAD1,850 through to March 31, 2015 and will be settled
from time to time with NWT as URU's finances permit.
**ENDS**
For further information please visit www.urumetals.com or contact:
URU Metals Limited John Zorbas(Chief Executive Officer) +1 416 504 3978
Northland Capital Partners Limited(Nominated Adviser and Joint Broker) Edward Hutton / Matthew Johnson + 44 (0) 207 382 1100
Beaufort Securities Limited(Joint Broker) Andrew Gutmann + 44 (0) 207 382 8300
St Brides Partners Ltd(Financial Public Relations) Lottie Brocklehurst +44 (0) 20 7236 1177
This information is provided by RNS
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