Final Results
31/10/2023 07:00
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Vast Resources plc / Ticker: VAST / Index: AIM / Sector: Mining
31 October 2023
Vast Resources plc
(‘Vast’ or the ‘Company’)
Final Results
Vast Resources plc, the AIM-listed mining company, is pleased to announce its
final results for the 12-month period ended 30 April 2023. A copy of the
annual report will be available on the Company’s website at www.vastplc.com
and printed copies are being posted to shareholders.
**ENDS**
For further information, visit www.vastplc.com or please contact:
Vast Resources plc Andrew Prelea (CEO) Andrew Hall (CCO) www.vastplc.com + 44 (0) 20 7846 0974
Beaumont Cornish – Financial & Nominated Advisor Roland Cornish James Biddle www.beaumontcornish.com +44 (0) 20 7628 3396
Shore Capital Stockbrokers Limited – Joint Broker Toby Gibbs / James Thomas (Corporate Advisory) www.shorecapmarkets.co.uk +44 (0) 20 7408 4050
Axis Capital Markets Limited – Joint Broker Richard Hutchinson www.axcap247.com +44 (0) 20 3206 0320
St Brides Partners Limited Susie Geliher www.stbridespartners.co.uk +44 (0) 20 7236 1177
OVERVIEW OF THE YEAR ENDED 30 APRIL 2023
Vast Resources plc (‘Vast’ or the ‘Group’ or the ‘Company’) is
focused on key mining opportunities in Romania, Zimbabwe and Tajikistan. These
opportunities comprise the Baita Plai Polymetallic Mine (“BPPM”) in
Romania, the Group’s expected opportunity in Zimbabwe, and participation in
a mining project in Tajikistan (“Takob project”) from which the Company
will receive the equivalent of a 12.25% royalty on all sales of non-ferrous
concentrate and other metals produced from an operating fluoride and galena
mine. The Group continued to hold the Manaila Polymetallic Mine (“MPM”) on
care and maintenance during the reporting period with the expectation of a
funding round at a later stage.
BPPM produced concentrate throughout the year, increasing milled production
from 38,108 metric tonnes for the year ended 30 April 2022 to 60,750 metric
tonnes for the year ended 30 April 2023. The Company continued to invest in
BPPM to support the transition to mechanised mining. The Company began a
drilling campaign at BPPM with the objective of establishing an enlarged JORC
compliant Mineral Resource potentially upgrading the existing Mineral Resource
with the inclusion of a JORC compliant Exploration Target of 11.65 to 12.65
million tonnes. Initial results received after the year end were very
encouraging confirming the potential to extend the mining area.
Having established steady state production of a 95% minimum fluorite
concentrate at the Takob mine in Tajikistan, the Takob project commenced
production of a lead and zinc concentrate at the end of the year and has
executed its first shipment after the year end. Shortly before the date of
this report the Company has executed a Memorandum of Understanding (MoU) which
will give it an interest in, and management responsibility for, the Aprelevka
gold mines in the Tien Shan Belt of Tajikistan.
Significant progress has been made towards achieving a satisfactory outcome to
our historic position in Zimbabwe and this has continued very positively post
year end.
Financial
* Unchanged revenues for the year ended 30 April 2023 (US$3.7 million)
compared to the year ended 30 April 2022 (US$ 3.8 million). Despite product
sales increasing revenues were impacted by lower copper prices.
* 14% decrease in other administrative and overhead expenses for the year
ended 30 April 2023 (US$3.9 million) compared to the year ended 30 April 2022
(US$4.5 million). The decrease is due to a significant reduction in payroll
costs mainly due to the elimination of expatriate employee headcount and
general reductions in expenses.
* Foreign exchange gains of US$1.4 million for the year ended 30 April 2023
compared to losses of US$3.8 million for the year ended 30 April 2022. These
profits arise from the Company’s USD denominated funding of its Romanian Lei
functional currency subsidiaries and are partly compensated by foreign
exchange translation losses of US$1.2 million. The Company funds its Romanian
businesses in USD given this funding will ultimately be repaid from USD
denominated sales.
* A decrease in losses after taxation in the year ended 30 April 2023 (US$10.5
million) compared to the year ended 30 April 2022 (US$15.5 million).
Eliminating the effects of foreign exchange gains and losses, the loss for the
period has increased from US$11.7 million for the year ended 30 April 2022 to
US$11.9 million for the year ended 30 April 2023.
* Cash balances at the end of the period US$0.530 million compared to US$0.130
million at 30 April 2022.
Operational Development
* BPPM milled production from 38,108 metric tonnes for the year ended 30 April
2022 to 60,750 metric tonnes for the year ended 30 April 2023.
* The Company continued to invest in BPPM to support the transition to
mechanised mining. Long-hole stopping was introduced during the period with
the purchase, delivery, and installation of drill rigs.
* The Company completed a second milling circuit at BPPM.
* The Company began drilling at BPPM for the purpose of establishing an
enlarged JORC compliant Mineral Resource which gives the Company potential to
upgrade the existing Mineral Resource with the inclusion of a JORC compliant
Exploration Target of 11.65 to 12.65 million MT at 0.98% to 1.69% copper,
0.23% to 0.57% lead, and 0.17% to 0.62% zinc.
* Following the successful opening of the Takob Mine Processing Project at the
Takob Mine in Tajikistan with Open Joint Stock Company Korkhanai Boygardonii
Takob ("Takob"), the Takob project has executed an exclusive offtake contract
with Trafigura PTE. Ltd, one of the world’s leading independent commodity
trading and logistics companies for the sale of bulk concentrates produced via
the Takob project.
* Steady state production of a 95% minimum fluorite (CaF₂) concentrate was
attained at the Takob mine in Tajikistan thus achieving satisfaction of a
major performance condition of the contract with Korkhanai Boygardonii Takob.
Post reporting date:
* Initial drilling results for BPPM received after the year end were very
encouraging confirming the potential to extend the mining area.
* On 14 July 2023, an employee was fatally injured in a mine transportation
incident. The Directors and Management of Vast express their sincere
condolences to the family and colleagues of the deceased and will be providing
all necessary support to the family.
* Execution of first shipment to Trafigura of lead and zinc concentrate from
the Takob mine in Tajikistan.
* Execution of a Memorandum of Understanding (MoU) which will give it an
interest in, and management responsibility for, the Aprelevka gold mines in
the Tien Shan Belt of Tajikistan.
Funding
Equity:
Fundraising share issues during the year (gross proceeds before cost of
issue):
£ $ Shares issued Issued to
6,901,967 8,232,634 1,661,286,533 Placing with investors
1,743,325 2,121,265 249,046,446 Subscription by investors
82,500 99,753 15,000,000 Subscription by management
1,420,845 1,750,000 511,963,302 Settle debt
10,148,637 12,203,652 2,437,296,281
Post reporting date:
£ $ Shares issued Issued to
3,520,350 4,409,350 1,419,000,000 Placing with investors
3,520,350 4,409,350 1,419,000,000
Debt:
* On 16 May 2022, the Company repaid in full the outstanding bonds owed to
Atlas and subsequently made a US$1 million debt reduction to the amount owed
to Mercuria. These repayments were in part financed by a US$4 million asset
backed debt facility from A&T Investments SARL (“Alpha”) with maturity 15
May 2023.
Post reporting date:
* The Company has been in continuing discussions with Mercuria and Alpha
regarding extensions in the repayment date for the totality of the debt owed
so as to allow further time to finalise the receipt of proceeds associated
with an historic claim in its operations. Mercuria and Alpha have been and
continue to be supportive to the Company having extended the repayment date on
several occasions with the current extension running to 30 November 2023.
Management
* Craig Harvey, Technical Director and Chief Operating Officer resigned on 3
March 2023.
Political and environmental
* The conflict in Ukraine has not had any direct adverse impact on Vast’s
operations but has continued to impact commodity markets.
CHAIRMAN’S REPORT
There have been some notable successes this year. Despite economic and
geopolitical headwinds, the Company successfully refinanced the Atlas bond
facility in May 2022. Production improved at the Baita Plai Polymetallic Mine
(“BPPM”) with the introduction of long-hole stopping. Significant progress
was made by the parties relating to our historic position in Zimbabwe, which
progress has continued positively after year end.
Romania
Production at the Baita Plai Polymetallic Mine (“BPPM”) increased over
last year, and the Company transitioned to a mechanised mining methodology,
commencing long-hole stopping in calendar Q3 2022. A second milling circuit
was also added. This has created the platform for further production
increases.
The Company began a drilling campaign at BPPM with the objective of
establishing an enlarged JORC compliant Mineral Resource potentially upgrading
the existing Mineral Resource with the inclusion of a JORC compliant
Exploration Target of 11.65 to 12.65 million tonnes. Initial results received
after the year end were very encouraging confirming the potential to extend
the mining area and to this end the Company will seek to increase capacity
accordingly at the appropriate time.
Given the many priorities and challenges during the year, the Company
continues to maintain the Manaila Polymetallic Mine (“MPM”) on care and
maintenance. The Company continues to engage with potential new investors at
the project level to support the restart.
Very sadly, on 14 July 2023, a mine employee at BPPM was fatally injured in a
mine transportation incident. Directors and Management of Vast express their
sincere condolences to the family and colleagues of the deceased and the
Company is providing all necessary support to the family.
Tajikistan
Tajikistan provides the Company with an exciting opportunity to develop local
mining and production capabilities in partnership with Takob. Having
established steady state production of a 95% minimum fluorite concentrate at
the Takob mine in Tajikistan, the Takob project commenced production of a lead
and zinc concentrate at the end of the year. The Directors believe that
Tajikistan offers the potential for other exciting developments.
Zimbabwe
Very positive progress has been made concerning our historic position in
Zimbabwe.
Directors and management
Craig Harvey, Technical Director and Chief Operating Officer resigned on 3
March 2023. I would like to thank Craig for his contribution to the Company
during his tenure as a director. We wish him well for the future. Craig’s
responsibilities regarding Romania are now undertaken by Nicolae Turdean, our
Romanian Country Manager. Nicolae is a mining engineer with decades of
experience in the mining industry and was previously President of Romania’s
National Agency for Mineral Resources and prior to that CEO of Cupru Min, a
Romanian state owned copper mine.
Funding
On 16 May 2022, the Company repaid in full the outstanding bonds owed to Atlas
and subsequently made a US$1 million debt reduction to the amount owed to
Mercuria. These repayments were in part financed by a US$4 million asset
backed debt facility from A&T Investments SARL (“Alpha”) with maturity 15
May 2023 which has subsequently been extended by mutual agreement to 30
November 2023.
Corporate Governance
As stated in the Strategic Report, the Company has adopted the Quoted Company
Alliance (‘QCA’) code on Corporate Governance. The Board strives to
promote a corporate culture based on sound ethical values and behaviours. The
Company maintains a strict anti-corruption and whistle blowing policy and the
Directors are not aware of any event in any jurisdiction in which it operates
that might be considered to be a breach of this policy. The Company has
formally adopted Code of Conduct, Health and Safety, Environmental, and Human
Rights policies which clearly articulate the Board’s expectations and
strengthen the control environment of the organisation. The Company continues
to operate a code for Directors’ and employees’ dealings in securities
which is appropriate for a company whose securities are traded on AIM and is
in accordance with the requirements of the Market Abuse Regulation which came
into effect in 2016. The Company is also committed to maintaining open
dialogue with shareholders, employees and other stakeholders.
Appreciation
The continued support and resolve of shareholders and other stakeholders
through times that have been challenging is much appreciated. To fellow
directors, thank you for your advice and support, and to management and staff
both in Romania and Zimbabwe for their continued effort on behalf of the
Company. Above all we wish all our stakeholders well in these difficult times
and remain committed to safeguarding the safety of our employees and the
communities in which we operate.
Brian Moritz
Chairman
STRATEGIC REPORT
Principal activities, review of business and future developments
Vision
The vision of the Group continues to be to become a mid-tier mining group, one
of the largest polymetallic (copper, zinc, silver, and gold) producers in
Romania, and a major player in the re-emergence of the mining industry in
Tajikistan.
Principal activities
In Romania the Group has focused on operating the Baita Plai Polymetallic Mine
(“BPPM”) which commenced production in October 2020. The Manaila
Polymetallic Mine (“MPM”) has remained on care-and-maintenance during the
period and the Company is engaged with new investors to support the restart.
In Tajikistan, the Group has a mining project in Tajikistan with a fluoride
and galena mine to produce and market non-ferrous concentrate and other
metals.
In Zimbabwe, the Group continues to focus on bringing the historic position to
a satisfactory conclusion and, post year end, the Group is now very well
advanced on this.
In both Romania and Tajikistan, the Group holds further mining claims or other
interests which are under appraisal.
Review of business
Romania
BPPM (100% interest)
Operations
The Company has continued to invest time and resources to fully implement the
transition to mechanised mining and successfully began long-hole stopping in
calendar Q3 2022 following the deliveries of two drilling rigs. BPPM produced
concentrate throughout the year, increasing milled production from 38,108
metric tonnes for the year ended 30 April 2022 to 60,750 metric tonnes for the
year ended 30 April 2023. Continued investment and production increases will
allow the mine to cover all the group’s costs. The progress this year
represents a significant achievement for the Company. We were, however, very
saddened on 14 July 2023, by a fatality at the mine. An employee was fatally
injured in a mine transportation incident. The Directors and Management of
Vast express their sincere condolences to the family and colleagues of the
deceased and will be providing all necessary support to the family.
Resources
The JORC compliant Resource & Reserve Report for BPPM comprises an Indicated &
Inferred mineral resource of 608,000 tonnes at 2.58% copper equivalent based
on a copper metal price of US$ 6,655/tonne. Under JORC an exploration target
has been identified, which includes an historical mineral resource of between
1.8 million to 3 million tonnes with a copper grade range of 0.50–2.00%,
gold range of 0.20–0.80 g/t and silver range of 40-80g/t. Subsequent to the
publication of the JORC assessment, and following an analysis of historical
data records, the exploration targets previously reported under the JORC were
increased from 1.8 million – 3.0 million tonnes to 3.2 million - 5.8 million
tonnes with copper grades in the range 0.50-2.00%, lead range 0.10-2.00%, zinc
range 0.10-2.00%, gold range 0.20- 0.80g/t, and silver range 40-80g/t further
reinforcing the value of BPPM. The Company has also begun a drilling campaign
for the purpose of establishing an enlarged JORC compliant Mineral Resource
and in due course an Ore Reserve for its licence renewal in August 2024. The
drilling campaign is supported by a Technical Programme Report prepared by the
Chief Geologist for geological and geotechnical consultants, Formin SA, and
countersigned by Top Consulting, Canada. The Report concludes that the
fulfilment of the programme will give the Company the potential opportunity to
upgrade the existing Mineral Resource with the inclusion of a JORC compliant
Exploration Target of 11.65 to 12.65 million metric tonnes at 0.98% to 1.69%
copper, 0.23% to 0.57% lead, and 0.17% to 0.62% zinc. Initial drill results
received after the year end were very encouraging confirming the potential to
extend the mining area.
MPM (100% interest)
The Manaila Carlibaba exploitation perimeter contains a JORC-2012 compliant
Indicated Mineral Resource of 3.6 million tonnes grading 0.93% copper, 0.29%
lead, 0.63% zinc, 0.23g/t gold and 24.9g/t silver with Inferred Mineral
Resources of 1.0 million tonnes grading 1.10% copper, 0.40% lead, 0.84% zinc,
0.24g/t gold and 29.2g/t silver. Under Page 8 of 65 JORC underground
exploration targets identified are 7.9 million – 23.6 million tonnes with
copper grades in range of 0.4-1.3%, lead range 0.2-0.7%, zinc range 0.3-1.1%,
and open pit exploration targets of 1.1 million – 3.2 million tonnes with
copper grades in range of 0.4-1.1%, lead 0.1-0.4%, and zinc range 0.2-0.6%.
The Company was granted the Manaila Carlibaba Exploitation License to 29
October 2025. The increase in demand for copper together with production
efficiencies confirmed by the assessment of the suitability of X-Ray Sorting
Technology (‘XRT’) to optimise the mine’s production profile results in
a substantial improvement in the economics of MPM. The test results conducted
by TOMRA indicate that an XRT machine can substantially reduce transportation
and production costs. It is for these reasons that the Company is engaged with
potential new investors at the project level to support the restart of MPM.
Blueberry Polymetallic Gold Project (`Blueberry’) (29.41% effective
interest).
The Group has an effective 29.41% economic interest in Blueberry through EMA
Resources Ltd (‘EMA’) in a brown field perimeter located at Baia de Aries
in the ‘Golden Quadrilateral’ of Western Romania on which historic work
has demonstrated prospectivity for gold and polymetallic minerals. The Group
has completed a drilling programme on the perimeter which has established
sufficient information to support a maiden JORC resource. The Company has
completed procedural and reporting requirements with the Romanian authorities.
These have now been accepted and will allow the Company to apply for an
exploitation licence. The results and net assets of the Blueberry project are
immaterial to the Group and therefore have not been included in the Group
financial statements under the equity method of accounting.
Other Romanian prospects
Given the Company’s focus on BPPM, the application for an Exploration
Licence for our current claims at Magura Neagra and Piciorul Zimbrului
(collectively known as ‘Zagra’) has been placed on hold and will
recommence once internal resources are available. The Group continues to
believe that exploitation of the many mining opportunities that have become
dormant in Romania over the last two decades will be an attractive prospect
for global mining players seeking to capitalize on the projected increase in
demand globally for copper occasioned by the global transition to clean energy
and electric vehicles.
The Group’s ‘first mover position’ in Romania has attracted interest in
resuscitating the large-scale polymetallic resource projects in Romania.
Tajikistan (12.25% effective interest)
Takob processing Project
The Company, as one of a collective group of partners, has a mining project
(the “Takob project”) in Tajikistan with Open Joint Stock Company
Korkhonai Boygardonii Takob (“Takob”). The interest in the Takob project
was acquired as a result of the acquisition by a recently incorporated UK
company, Central Asia Investments Ltd, in which Vast has a 49 percent interest
of a 50 percent interest in Central Asia Minerals and Metals Ore Trading FZCO
(“CAMM”) which has an agreement with Takob (the “Master Agreement”).
Vast has an effective 24.5 percent indirect interest in the Takob project.
Takob, a wholly owned subsidiary of the Tajikistan Open Joint Stock Company
“TALCO”, the country’s largest group of companies, is the owner of the
operating Takob fluorite and galena mine (the “Mine”) in Tajikistan where
the strategic fluoride concentrate is sold to TALCO’s chemical division
(“TALCO Chemical LLC”), for the production of essential raw materials
required for primary aluminium production.
Under the Master Agreement the Mine is to produce approximately 7,000 tonnes
per month of ore containing no less than 1.5-2% lead, 1.2-1.4% zinc and 27%
fluoride. Under the Master Agreement CAMM is to provide equipment, technology
and technical expertise to upgrade and optimise the processing plant at the
Mine, and will undertake the responsibility for the management and execution
of the Takob project. Takob will continue to mine ore at the Mine and produce
fluoride concentrate. Takob has undertaken to supply no less than 1,000,000
tonnes of ore to be processed in line with the Project that is anticipated to
run with the current Resource statement for 12 years.
CAMM has also under the Master Agreement been appointed as exclusive agent for
Takob to market and sell all non-ferrous concentrates and precious metals from
Takob’s Mine including but not limited to lead, zinc, gold and silver. An
exclusive offtake contract has been entered into with Trafigura PTE. Ltd, one
of the world’s leading independent commodity trading and logistics companies
for the sale of bulk concentrates produced by the Takob project. CAMM has
secured financing and is fully funded for the Takob project. In consideration
for CAMM’s financing obligations and provision of services under the Master
Agreement CAMM will be entitled to receive 50 percent of net revenue from the
sale of non-ferrous concentrate and precious metals. In order for CAMM to
provide the expertise required to fulfil its services and marketing
obligations under the Master Agreement CAMM has entered a services agreement
with Vast to provide the services required. Under this agreement Vast is
entitled to charge for the services provided on the basis that 24.5 percent of
the fees earned will be left outstanding until they can be financed from
revenue arising from the Takob project. The project has made good progress
with the Takob mine achieving steady state production of a 95% minimum
fluorite (CaF₂) concentrate thus achieving satisfaction of a major
performance condition of the contract. In addition to fees receivable under
the services agreement with CAMM Vast will receive the equivalent of 12.25
percent royalty of all sales of the non-ferrous concentrate and any other
metals produced for its participation in the collective group. The Takob
project commenced production of a lead and zinc concentrate at the end of the
financial year and has executed its first shipment after the year end.
Takob Tailings Project
CAMM also executed a Memorandum of Understanding (“MoU”) with Open Joint
Stock Company TALCO linked to processing the tailings produced by the Takob
Mine processing facility. During the initial soil sampling phase, the company
reported visible signs of Lead, Zinc and precious metals, including Gold,
Silver & Platinum Group Metals, in the tailings facility. Initial surface
survey results show that there is a minimum of 1 million tons and up to 3.3
million tons. Over the past 40 years of mining the processing plant was
focused on Calcium Fluoride recoveries, not on extraction of non-ferrous or
precious metals.
MoU for Aprelevka Gold Mines
Shortly before the date of this report the Company has executed a legally
binding MoU which will give it an interest in, and management responsibility
for, the Aprelevka gold mines in the Tien Shan Belt of Tajikistan.
Zimbabwe
As stated in the Chairman’s Report, very significant progress has been made
during the year and continues to be made after the year end on the Company’s
outstanding historic position in Zimbabwe. Full details have been disclosed in
the Company’s announcements.
Corporate
On 16 May 2022, the Company repaid in full the outstanding bonds owed to Atlas
and subsequently made a US$1 million debt reduction to the amount owed to
Mercuria. These repayments were in part financed by a US$4 million asset
backed debt facility from A&T Investments SARL (“Alpha”) with maturity of
one year, which is due for repayment on 30 November 2023.
Strategy
The Group’s strategy is to:
* Attract appropriate funding for the Group – including from institutional
investment
* Attract appropriate joint venture partners and public institutions to invest
in the Group and projects of mutual interest
* Grow into a mid-tier mining company both organically and through
acquisitions financed principally by third parties
* Optimise operations to produce positive cashflows
* Add value to operations by increasing resources and reserves
* If expedient, hold significant minority stakes in new ventures operationally
managed by the Group
* Finance growth, where possible in a non-dilutive manner
* Maintain exposure to Romania and Zimbabwe where the Group has acquired
in-depth country knowledge
* Develop the Company’s existing relationship in Tajikistan with Talco with
a view to expanding its portfolio within the country
* Expand the Company’s polymetallic footprint further afield to complement
its Romanian strategy
Key performance indicators
In executing its strategy, the Board considers the Group’s key performance
indicators to be:
Cash cost per tonne milled
* Cash cost per tonne is derived from aggregate cash costs divided by tonnes
milled and measures productivity.
* BPPM cash cost per tonne was US$138 for the year (2022: US$180) and is
derived from aggregate cash costs divided by tonnes milled and measures
productivity.
* There has been no production at MPM this and last year given the mine was on
care and maintenance.
Cash costs per tonne of concentrate
* Cash cost per tonne produced is calculated by dividing aggregate cash cost
by concentrate tonnes produced and measures productivity.
* BPPM cash cost per tonne was US$5,407 for the year (2022: US$7,654) and is
derived from aggregate cash costs divided by the tonnes produced.
* There has been no production at MPM this year given the mine has been on
care and maintenance.
Plant production volumes as a measure of asset utilisation
* BPPM processed mill feed of 60,750 tonnes (2022: 38,108 tonnes).
* There has been no production at MPM this and last year given the mine was on
care and maintenance.
Total resources and reserves
* These indicators measure our ability to discover and develop new ore bodies,
including through acquisition of new mines, and to replace and extend the life
of our operating mines. We have published JORC-2012 compliant resource
estimates for both BPPM and MPM which are described above.
The rate of utilization of the Group’s cash resources. This is discussed
further below.
Cash resources
The Group’s year end position was US$0.503 million (2022: US$0.130 million).
During the year cash used in operations were US$6.396 million, with a
significant portion of the balance directly related to developing, supporting
and maintaining our mining assets.
Cash outflows from investing activities were US$1.871 million comprising
additions to property, plant, and equipment.
Cash net inflows from funding activities were US$ 8.694 million, comprising
the net of the proceeds from the issuance of shares of US$9.816 million less
net repayment of loans and borrowings and finance expenses of US$1.122
million.
The Directors monitor the cash position of the Group closely to plan
sufficient funds within the business to allow the Group to meet is commitments
and continue the development of assets. As part of this process, the Directors
closely monitor capital expenditure and the regulatory requirements of the
licences to ensure they continue in good standing.
Principal risks and uncertainties
Risk – Going concern
The Company will require funding in order to repay the Mercuria and Alpha debt
facilities, and to provide general working capital. The original maturity date
for these facilities was 15 May 2023 and this has been extended on several
occasions with the current extension by mutual agreement running to 30
November 2023. The Company has been in continuing discussions with Mercuria
and Alpha for extensions in the repayment date for the totality of the debt
owed so as to allow further time to realise the proceeds associated with a
historic claim in its operations. The Company expects these to repay both
Mercuria and Alpha, with the balance, together possibly with an element of
debt financing in discussion, to provide necessary funds for working capital
and BPPM expansion purposes. At the date of this Report the Company expects
the historic claim proceeds receipt very shortly although there can be no
certainty as to the precise date, and neither is there a legally binding
extension of the Mercuria and Alpha loans beyond 30 November nor alternative
legally binding funding arrangements. These conditions indicate the existence
of a material uncertainty which may cast significant doubt about the Group's
and Company's ability to continue as a going concern. The financial statements
do not include the adjustment that would result if the Group and Company were
unable to continue as a going concern.
Mitigation/Comments
In the event that the receipt of the historic claim proceeds were received
after 30 November 2023, management is confident that with continued progress
in the realisation process Mercuria and Alpha would remain supportive. To
date, Mercuria and Alpha have extended the original repayment date several
times. However, as mitigation, the Company continues to engage with investors
and debt providers in order to provide liquidity to repay the Mercuria and
Alpha debt and to articulate the fundamental strength of the Group’s
business so as to attract additional funding when required. The Board also
will, whenever possible, retain sufficient cash margin to offset
contingencies.
Risk – Mining
Mining of natural resources involves significant risk. Drilling and operating
risks include geological, geotechnical, seismic factors, industrial and
mechanical incidents, technical failures, labour disputes and environmental
hazards.
Mitigation/Comments
Use of strong technical management together with modern technology and
electronic tools assist in reducing risk in this area. Good employee relations
are also key in reducing the exposure to labour disputes. The Group is
committed to following sound environmental guidelines and is keenly aware of
the issues surrounding each individual project.
Risk - Commodity prices
Commodity prices are subject to fluctuation in world markets and are dependent
on such factors as mineral output and demand, global economic trends and
geo-political stability.
Mitigation/Comments
The Group’s management constantly monitors mineral grades mined, cost of
production, and commodity diversity to ensure that mining output becomes or
remains economic. The anticipated marginal contributions going forward at BPPM
are high versus fixed costs which provides a degree of liquidity protection in
the event prices decline significantly.
Risk – Management and Retention of Key Personnel
The successful achievement of the Group's strategies, business plans and
objectives depend upon its ability to attract and retain certain key
personnel.
Mitigation/Comments
The Group’s policy is to foster a management culture where management is
empowered and where innovation and creativity in the workplace are encouraged.
The Group has in place a “Share Appreciation Rights Scheme” for Directors
and senior executives to provide incentives based on the success of the
business and continues to consult third party benchmarks for remuneration.
Risk - Country and Political
The Group’s activities are based in Romania, Zimbabwe and Tajikistan.
Emerging market economies could be subject to greater risks, including legal,
regulatory, economic, bribery and political risks, and are potentially subject
to rapid change.
Mitigation/Comments
The Group’s management team is experienced in its areas of operation and
skilled at operating within the framework of the local culture in Romania,
Tajikistan and Zimbabwe to progress its objectives. The Group routinely
monitors political and regulatory developments in each of its countries of
operation. In addition, the Group actively engages in dialogue with relevant
government representatives to keep abreast of all key legal and regulatory
developments applicable to its operations. The Group has several internal
processes and checks in place to ensure that it is wholly compliant with all
relevant regulations to maintain its mining or exploration licences within
each country of operation.
Risk - Social, Safety and Environmental
The Group's success may depend upon its social, safety and environmental
performance, as failures can lead to delays or suspension of its mining
activities.
Mitigation/Comments
The Group takes its responsibilities in these areas seriously and monitors its
performance across these areas on a regular basis. The Group has adopted and
obtained ISO 9001:2015 for Quality, ISO 45001: 2018 for Safety, and ISO
140001: 2015 for Environment. As mentioned earlier, we were very saddened on
14 July 2023 by a fatality at BPPM. An employee was fatality injured in a mine
transportation incident.
Corporate Governance
The Company has adopted the QCA (Quoted Company Alliance) Code on corporate
governance. Details of how the Company complies with this are set out on the
Company’s website. Principles which are required to be dealt with under the
Code in the Company’s Annual Report are set out below.
Business model and strategy
This is described above under Strategy and elsewhere in this Report.
Risk Management
In addition to its other roles and responsibilities, the Audit and Compliance
Committee is responsible to the Board for ensuring that procedures are in
place and are being implemented effectively to identify, evaluate and manage
the significant risks faced by the Company.
The Directors have established procedures, as represented by this statement,
for the purpose of providing a system of internal control. An internal audit
function is not considered necessary or practical due to the size of the
Company and the close day to day control exercised by the Executive Directors.
The Board works closely with and has regular ongoing dialogue with the Company
Financial Director and other Executive Directors and has established
appropriate reporting and control mechanisms to ensure the effectiveness of
its control systems.
The risks facing the Company are detailed above. The Board seeks to mitigate
such risks so far as it is able to, as explained above, but certain important
risks cannot be controlled. The CEO is primarily responsible to the Board for
risk management.
In particular, the products the Company mines and is seeking to identify are
traded globally at prices reflecting supply and demand rather than the cost of
production. In Romania, the Company seeks to protect its cash flow by means of
a long-term offtake agreement, but it does not hedge future production.
Maintenance of a well-functioning Board of Directors led by the Chairman
Membership of the Board during the year is as follows:
Name Role Appointed
Brian Moritz Non-Executive Chairman 3 October
2016
Andrew Prelea Chief Executive Officer 1 March
2018
Roy Tucker Non-Executive Director 5 April 2005
Paul Fletcher Finance Director 6 November 2019
Craig Harvey Chief Operating Officer 1 March
2018 (resigned 3 March 2023)
Nick Hatch Non-Executive Director 9 May 2018
Nigel Wyatt Non-Executive Director 23 August
2021
Andrew Hall Commercial Director 6 December 2021
The Non-Executive Directors other than Roy Tucker are considered to be
independent.
All the Directors are subject to re-election at intervals of no more than
three years.
The table illustrates the success of the Board in refreshing its membership.
The Board is well balanced both in its skill sets and in the domicile of its
members. Of the Executive Directors, Andrew Prelea is resident in Romania,
Andrew Hall and Paul Fletcher in the UK, and Craig Harvey split his time
between Romania and Southern Africa, with the majority of his time spent in
Romania until his resignation on 3 March 2023. All the Non-Executive Directors
are resident in the UK.
Non-Executive Directors are committed to devote 3 days per month to the
Company. Executive Directors devote substantially the whole of their time to
the Company.
Where possible Directors are physically present at board meetings. However,
due to the wide divergence of locations, Directors may be present by
telephone.
During the year ended 30 April 2023 there were 10 board meetings of the
Company which save for the absence by one Director on one occasion were
attended by all the Directors. There were a further 10 meetings of a formal
nature. There were also two General Meetings in addition to the Annual General
Meeting.
Appropriate skills and experience of the Directors
The CVs of the Directors – four executives (three post 3 March 2023) and
four non-executives – as disclosed on the website, are set out below. In
addition, the Company has employed the outsourced services of Ben Harber of
Shakespeare Martineau as company secretary.
Andrew Prelea – Chief Executive Officer
Andrew has been involved in the mining sector for 11 years and with Vast since
2013. He has spearheaded the development of the Company’s Romanian
portfolio. Beginning his career in the early 1990s as a bulk iron ore and
steel trader in Romania, he then went on to develop his career in the property
and earthmoving sector in Australia before returning to Romania in 2003,
initially to focus on the development of properties for the Romanian Ministry
of Defence and latterly, private sector developments. Throughout his 30 year
career, Andrew has developed extensive investor and public relations
experience and has advised the Romanian government on wide ranging high-level
topics including social housing and economic policy. He has built a strong
network of contacts across the mining and metals industries and Europe and
southern Africa, in addition to policy makers and governmental authorities in
Romania, Tajikistan, and Zimbabwe.
Brian Moritz – Chairman
Brian is a Chartered Accountant and former Senior Partner of Grant Thornton UK
LLP, London; he formed Grant Thornton’s Capital Markets Team which floated
over 100 companies on AIM under his chairmanship. In December 2004, he retired
from Grant Thornton UK LLP to concentrate on bringing new companies to the
market. He specialises in natural resources companies, primarily in Africa,
and was formerly chairman of Metal Bulletin plc, African Platinum plc and
Chromex Mining plc as well as currently being chairman of several junior
mining companies.
Roy Tucker – Non-Executive Director
Roy is a Chartered Accountant with some 50 years of high level and broad
spectrum professional and business experience. He has been the founder of a
London banking group, served on bank boards and had a position as a major
shareholder of a substantial London commodity house. He is also the founder of
Legend Golf and Safari Resort in South Africa. He has substantial investment
in the Romanian property sector.
Paul Fletcher – Finance Director
Paul is a Chartered Accountant and Fellow of the Association of Corporate
Treasurers with 31 years’ experience working in the commodity and financial
services industries. He has held a variety of senior international finance and
operational roles in trading, processing, and financial businesses in the US,
Europe, and Asia.
Andrew Hall – Commercial Director
Andrew has spent the last fourteen years working in natural resources and
finance linked businesses. Before joining the Company in December 2018, Andrew
previously worked at a natural resources focussed merchant bank where he
established and managed the alternative finance distribution business covering
asset managers, private equity, investment banks, family offices and trading
houses.
Craig Harvey – Chief Operating Officer
Craig began his career with Gold Fields of SA in 1988 as a bursary student in
Economic Geology where he worked on various gold, platinum, coal and
exploration projects. At Harmony Gold he managed the mineral resources on
various operations and was involved in due diligence on acquisitions. He
joined Simmer and Jack with a focus on shallow hydro-thermal gold deposits in
the Eastern Transvaal and later moved into a corporate role managing and
auditing the mineral resource process across all gold and uranium operations.
Craig spent 3 years in a Principal Consultant role for Ravensgate based in
Perth, Australia, where he conducted numerous resource estimations, valuations
and technical reports mainly in gold, uranium, copper and iron ore. Craig
joined Vast Resources as a consultant in 2013 and became Chief Operating
Officer in March 2017. During his tenure with Vast Resources, he has been
heavily involved in both Zimbabwe and Romania. Craig resigned from the Board
on 3 March 2023 and his roll on BPPM has been allocated to the Romanian
Country Manager under the supervision of Andrew Prelea. The Romania Country
Manager, Nicolae Turdean, is a mining engineer with decades of expertise in
the mining industry and was previously President of Romania’s National
Agency for Mineral Resources and prior to that CEO of Cupru Min, a Romanian
state- owned copper mine.
Nick Hatch – Non-Executive Director
Nick has more than 37 years’ experience in mining investment banking,
primarily as a mining analyst and in managing mining & metals research and
equities teams. He was most recently Director of Mining Equity Research at
Canaccord Genuity in London. Nick’s experience includes researching and
advising on mining companies and projects across the globe and across the
commodity spectrum and includes companies of all sizes. Nick left investment
banking in 2017, and has set up his own company, Nick Hatch Mining Advisory
Ltd, to provide mining research, business development and financing advice. He
holds a degree in Mining Geology and is a Chartered Engineer.
Nigel Wyatt – Non-Executive Director
Nigel is a Chartered Engineer, a graduate of the Camborne School of Mines. He
has held senior positions in several mining and engineering companies
primarily in Southern Africa. These include CEO of Chromex Mining Plc, group
marketing director of a De Beers subsidiary group supplying specialised,
materials, engineering and technology to the mining and industrial sectors,
and commercial director of Dunlop Industrial Products (Pty) Ltd, South Africa.
He has wide ranging experience in ore and diamond recovery technologies and
the manufacture of electronic sorting equipment. His experience includes the
design and erection of ore sorting and treatment plants.
The Company believes that the current balance of skills on the Board, as a
whole, reflects the broad range of commercial and professional skills that the
Company requires. Among the Executive Directors, Andrew Prelea is experienced
in general management, including identifying and negotiating new business
opportunities; Paul Fletcher is a Chartered Accountant and Fellow of the
Association of Corporate Treasurers with broad international and financial
management experience in the commodity sector, Craig Harvey, who resigned on 3
March 2023, is a qualified geologist experienced in constructing and operating
mines, and Andrew Hall is experienced in natural resource and finance linked
businesses.
Among the Non-executives Brian Moritz is a Chartered Accountant with senior
experience. In addition to his financial skills he has former experience as a
Registered Nominated Adviser. Roy Tucker is a Chartered Accountant with many
years’ experience in general executive management. Nick Hatch is a qualified
geologist with experience in evaluating mining companies and natural resource
projects. Nigel Wyatt is a Chartered Engineer, a graduate of the Camborne
School of Mines with wide ranging experience in the commercial aspects of
mining and in ore and diamond recovery technologies.
Importantly, three Directors without geological qualifications have
significant experience with junior companies in the natural resources sector.
Evaluation of Board Performance
The Group is in the process of fast evolution and at this stage in the
Company’s development it is not deemed necessary to adopt formal procedures
for evaluation of the Board or of the individual Directors. There is frequent
informal communication between members of the Board and peer appraisal takes
place on an ongoing basis in the normal course of events. However, the Board
will keep this under review and may consider formalised independent evaluation
reviews at a later stage in the Company’s development.
Given the size of the Company, the whole Board is involved in the
identification and appointment of new Directors and as a result, a Nominations
Committee is not considered necessary at this stage. The importance of
refreshing membership of the Board is recognised and has been implemented. In
2018 Andrew Prelea was appointed to replace Roy Pitchford as CEO, and Nick
Hatch replaced Brian Basham as a Non-executive Director. In November 2019,
Paul Fletcher was appointed to the Board as Finance Director, and in 2021
Nigel Wyatt was appointed to replace Eric Diack as Non-executive Director, and
Andrew Hall appointed to the Board as Commercial Director. Nevertheless, it is
envisaged that the Board will be strengthened in due course as and when new
projects are operated by the Company.
Maintenance of Governance Structures and Processes
The corporate governance structures which the Company is able to operate are
limited by the size of the Board, which is itself dictated by the current size
and geographical spread of the Company’s operations, with Directors resident
in the UK, Romania and Southern Africa. With this limitation, the Board is
dedicated to upholding the highest possible standards of governance and
probity.
The Chairman, Brian Moritz:
* leads the Board and is primarily responsible for the effective working of
the Board;
* in consultation with the Board ensures good corporate governance and sets
clear expectations with regards to Company culture, values and behaviour;
* sets the Board’s agenda and ensures that all Directors are encouraged to
participate fully in the activities and decision-making process of the Board.
The CEO, Andrew Prelea:
* is primarily responsible for developing Vast’s strategy in consultation
with the Board, for its implementation and for the operational management of
the business;
* is primarily responsible for new projects and expansion;
* in conjunction with the CFO and Commercial Director is responsible for
attracting finance and equity for the Company;
* runs the Company on a day-to-day basis;
* implements the decisions of the Board;
* monitors, reviews and manages key risks.
The Chief Operating Officer, Craig Harvey, until his resignation from the
Board on 3 March 2023:
* was responsible for operational improvements and efficiency of mining
operations in Romania;
* was responsible for expansion and exploration of projects at the mine level;
* was responsible for the Baita Plai mine ramp-up;
* assisted and advised on the operation and expansion of other operations and
projects;
* provided technical input on new projects.
Craig’s responsibilities following his resignation regarding Romania have
been transferred to the Romanian Country Manager, Nicolae Turdean under the
Board supervision of Andrew Prelea.
The Finance Director, Paul Fletcher:
* is responsible for the administration of all aspects of the Group;
* oversees the accounting and treasury function of all Group companies;
* in conjunction with the CEO, is responsible for the financial risk
management of the Company;
* is responsible for financial modelling to support fund raising initiatives
and structuring trade related funding;
* is responsible for financial planning and analysis;
* deals with all matters relating to the independent audit.
The Commercial Director, Andrew Hall:
* works with the CEO on the Company’s strategic business initiatives and
capital raising;
* is responsible for offtake relationships;
* is responsible for leading the Company’s external and investor
communications;
* is the main point of contact with the Company’ s Nomad.
Roy Tucker who is a Non-Executive Director also provides legal, consultancy
and compliance services to the Company.
The Remuneration Committee is currently chaired by Nick Hatch and comprises
Nick Hatch, Brian Moritz and Nigel Wyatt. The Remuneration Committee is
responsible for establishing a formal and transparent procedure for developing
policy on executive remuneration and to set the remuneration packages of
individual Directors. The Committee’s policy is to provide a remuneration
package which will attract and retain Directors and management with the
ability and experience required to manage the Company and to provide superior
long-term performance.
The Audit and Compliance Committee is currently chaired by Brian Moritz and
comprises Brian Moritz, Nick Hatch and Nigel Wyatt. It normally meets twice
per annum to inter alia, consider the interim and final results. In the latter
case the auditors are present and the meeting considers and takes action on
any matters raised by the auditors arising from their audit.
Matters reserved for the Board include:
* Vision and strategy
* Production and trading results
* Financial statements and reporting
* Financing strategy, including debt and other external financing sources
* Budgets, acquisitions and expansion projects, divestments and capital
expenditure and business plans
* Corporate governance and compliance
* Risk management and internal controls
* Appointments and succession plans
* Directors’ remuneration
Shareholder Communication
The Board is committed to maintaining effective communication and having
constructive dialogue with its shareholders in accordance with Principle Two
of the Quoted Companies Alliance Code as adopted by the Company. The Company
is desirous of obtaining an institutional shareholder base, and institutional
shareholders and analysts will have the opportunity to discuss issues and
provide feedback at meetings with the Company.
The Investors section of the Company’s website provides all required
regulatory information as well as additional information shareholders may find
helpful including: information on Board members, advisors and significant
shareholdings, a historical list of the Company’s Announcements, its
corporate governance information, the Company’s publications including
historic annual reports and notices of annual general meetings, together with
share price information.
The results of shareholder meetings will be publicly announced through the
regulatory system and displayed on the Company’s website with suitable
explanations of any actions undertaken as a result of any significant votes
against resolutions.
Section 172 (1) Statement
The Directors of the Company must act in accordance with a set of general
duties. These duties are detailed in section 172 of the UK Companies Act 2006.
This Section 172 statement explains how the Directors fulfil these duties.
Each Director must act in a way that they consider, in good faith, would be
most likely to promote the Company’s success for the benefit of its members
as a whole, and in doing so have regard (among other matters) to:
S172(1) (a) “The likely consequences of any decision in the long term”
The Board has focused its resources primarily on its key mining opportunity,
BPPM. The Board is also looking to expand the Company’s polymetallic
footprint further afield to complement its Romanian and Zimbabwe strategies.
For further details on the Company’s strategy and the key performance
indicators, please see page 9 and 10. The Board has implemented processes to
identify, measure, manage, and mitigate risks and uncertainties arising from
the implementation of its strategy. These risks and uncertainties are
highlighted on pages 10, 11 and 12 of the annual report and the processes by
which they are managed are highlighted under the Risk Management principles
set out on the Corporate Governance section on page 12.
S172(1) (b) “The interests of the Company’s employees”
The successful achievement of the Group's strategies, business plans and
objectives depend upon its ability to attract, motivate, and protect the
safety of its employees. Health and Safety, and Human Rights policies clearly
articulate the Board’s expectations and safeguard the interests of the
Company’s employees. The Group’s policy is to foster a management culture
where management is empowered and where innovation and creativity in the
workplace are encouraged and rewarded. This is reflected in the performance
programs that the Company has implemented.
S172(1) (c) “The need to foster the company’s business relationships with
suppliers, customers and others”
The Company has ongoing dialogue with its customers and suppliers and ensures
that a strong relationship is maintained at the level of senior management.
This ensures alignment with the Company’s business objectives and promotes
strong collaboration. As mentioned on page 16, under Shareholder
Communication, the Board maintains effective communication with its
shareholders and provides updates and information through public announcements
on the regulatory system and on the Company website.
S172(1) (d) “The impact of the company’s operations on the community and
the environment”
As mentioned on page 11, under Risk – Social, Safety and Environmental, the
Group monitors its performance across these areas on a regular basis. The
Group has adopted and obtained ISO 9001:2015 for Quality, ISO 45001: 2018 for
Safety, and ISO 140001: 2015 for Environment. The Group adheres to all
Covid-19 rules, regulations, and guidelines in preventing transmission of the
infection through the workforce. As mentioned in the Chairman’s Report on
page 5, the Company has also implemented formal policies on these areas.
S172(1) (e) “The desirability of the company maintaining a reputation for
high standards of business conduct”
As more fully explained on page 5 of the Chairman’s Report and under the
Corporate Governance section on page 12 the Board strives to promote a culture
based on high business conduct standards.
S172(1) (f) “The need to act fairly as between members of the company”
Having assessed all necessary factors, and as supported by the processes
described above, the Directors consider the best approach to delivering on the
Company’s strategy. This is done after assessing the impact on all
stakeholders and is performed in such a manner so as to act fairly as between
the Company’s members.
Outlook
The Company has continued to invest time and resources to implement the full
transition to mechanised. The Company began a drilling campaign with the
objective of establishing an enlarged JORC complaint Mineral Resource
potentially upgrading the existing Mineral Resource with the inclusion of a
JORC compliant Exploration target of 11.65 to 12.65 million tonnes. Initial
results received after the year end were very encouraging confirming the
potential to extend the mining area. MPM continues to hold significant value
for the Company, supported by continued strong demand for copper and improved
production techniques. The priorities this year prevented the team from
devoting time to realising the value of the asset and we are re-engaging with
investors to support at the project level the restart of MPM. The Company also
anticipates traction on its other Romanian opportunities.
In Tajikistan, we see an exciting opportunity to develop our position in
country in polymetallics as evidenced by the signing of an MoU in connection
with the Aprelevka gold mines. In Zimbabwe, the Group continues to focus on
the historic position to a satisfactory realisation -, post the year end, now
very well advanced.
The economic fundamentals for the Company’s polymetallic business are
strong. Continued demand for copper has buoyed prices, despite current
geopolitical risks. The forecast global growth in electric vehicles remains
likely to create, over the next decade, a shortage of copper as producers
struggle to meet demand as a consequence of declining grades, water supply
issues and community resistance holding back discovery and exploitation of new
resources.
Management believes that a combination of a bullish outlook on polymetallics
together with a reduction in Romanian risk premiums has the potential to
provide significant medium-term growth in the share price and the financial
performance of these businesses.
Many thanks to fellow Board members and management for the commitment and hard
work that has been put into the Group. I also thank all our stakeholders for
their support.
On behalf of the Board,
Andrew Prelea
Group Chief Executive Officer
REPORT OF THE DIRECTORS
for the year ended 30 April 2023
The Directors present their report together with the audited financial
statements for the twelve-month period ended 30 April 2023.
Results and dividends
The Group statement of comprehensive income is set out on page 29 and shows
the profit for the period.
The Directors do not recommend the payment of a dividend (2022: nil).
Financial instruments
Details of the use of financial instruments by the Company and its subsidiary
undertakings are contained in note 21 of the financial statements.
Directors
The Directors who served during the period and up to the date hereof were as
follows: -
Date of Appointment
Roy Tucker 5 April 2005
Brian Moritz 3 October 2016
Andrew Prelea 1 March 2018
Craig Harvey 1 March 2018 (resigned 3 March
2023)
Nick Hatch 9 May 2018
Paul Fletcher 6 November 2019
Nigel Wyatt 23 August 2021
Andrew Hall 6 December 2021
Directors’ interests
The interests in the shares of the Company of the Directors who served during
the period were as follows:
30 April 2023 30 April 2022
Ordinary Shares Ordinary Shares
Andrew Hall 115,550 115,550
Nigel Wyatt - -
Paul Fletcher 705,481 705,481
Craig Harvey* 56,500 56,500
Nick Hatch - -
Brian Moritz 250,000 250,000
Andrew Prelea 31,065,147 16,065,147
Roy Tucker 2,945,757 2,945,757
Total 35,138,435 20,138,435
*For the year ended 30 April 2023, shares held by Craig Harvey are as at 3
March 2023, the date of his resignation.
Share Appreciation Rights Scheme
The following Directors have been granted rights under the Company’s Share
Appreciation Rights Scheme:
In issue at Grant date Awarded during period Exercised / lapsed during period In issue at Vesting period
30 April 2022 30 April 2023
Start Finish
Paul 50,000 04-Nov-19 (50,000) 0 04-Nov-19 03-Nov-22
Fletcher 50,000 04-Nov-19 (50,000) 0 04-Nov-19 31-Mar-23
175,000 24-Nov-20 175,000 24-Nov-20 23-Nov-23
175,000 24-Nov-20 175,000 31-Mar-21 31-Mar-24
2,000,000 05-Jul-21 (2,000,000) 0 31-Dec-22 31-Dec-25
24-Apr-23 10,750,000 10,750,000 01-May-23 31-Dec-25
24-Apr-23 10,750,000 10,750,000 01-May-23 31-Dec-25
Nick 50,000 24-Nov-20 50,000 24-Nov-20 23-Nov-23
Hatch 50,000 24-Nov-20 50,000 31-Mar-21 31-Mar-24
Craig 90,000 01-Mar-18 (90,000) 0 31-Mar-20 31-Mar-23
Harvey 90,000 04-Nov-19 (90,000) 0 04-Nov-19 03-Nov-22
90,000 04-Nov-19 (90,000) 0 04-Nov-19 31-Mar-23
100,000 24-Nov-20 100,000 24-Nov-20 23-Nov-23
100,000 24-Nov-20 100,000 31-Mar-21 31-Mar-24
2,000,000 05-Jul-21 (2,000,000) 0 31-Dec-22 31-Dec-25
Andrew 180,000 01-Mar-18 (180,000) 0 31-Mar-20 31-Mar-23
Prelea 180,000 04-Nov-19 (180,000) 0 04-Nov-19 03-Nov-22
180,000 04-Nov-19 (180,000) 0 04-Nov-19 31-Mar-23
2,000,000 05-Jul-21 (2,000,000) 0 31-Dec-22 31-Dec-25
24-Apr-23 15,000,000 15,000,000 01-May-23 31-Dec-25
24-Apr-23 15,000,000 15,000,000 01-May-23 31-Dec-25
Roy 90,000 01-Mar-18 (90,000) 0 31-Mar-20 31-Mar-23
Tucker 90,000 04-Nov-19 (90,000) 0 04-Nov-19 03-Nov-22
90,000 04-Nov-19 (90,000) 0 04-Nov-19 31-Mar-23
112,500 24-Nov-20 112,500 24-Nov-20 23-Nov-23
112,500 24-Nov-20 112,500 31-Mar-21 31-Mar-24
2,000,000 05-Jul-21 (2,000,000) 0 31-Dec-22 31-Dec-25
24-Apr-23 7,000,000 7,000,000 01-May-23 31-Dec-25
24-Apr-23 7,000,000 7,000,000 01-May-23 31-Dec-25
Andrew 50,000 04-Nov-19 (50,000) 0 04-Nov-19 03-Nov-22
Hall 50,000 04-Nov-19 (50,000) 0 04-Nov-19 31-Mar-23
100,000 24-Nov-20 100,000 24-Nov-20 23-Nov-23
100,000 24-Nov-20 100,000 31-Mar-21 31-Mar-24
2,000,000 05-Jul-21 (2,000,000) 0 31-Dec-22 31-Dec-25
24-Apr-23 10,250,000 10,250,000 01-May-23 31-Dec-25
24-Apr-23 10,250,000 10,250,000 01-May-23 31-Dec-25
12,355,000 86,000,000 (11,280,000) 87,075,000
See note 23 for further details of the SARS.
Directors’ remuneration
2023 2022
Salary/Fees Other Total Salary/Fees Other Total
$’000 $’000 $’000 $’000 $’000 $’000
Nigel Wyatt 27 - 27 20 - 20
Paul Fletcher 176 1 177 193 7 200
Craig Harvey 192 - 192 192 - 192
Nick Hatch 27 - 27 30 - 30
Brian Moritz 28 - 28 31 - 31
Andrew Prelea 258 - 258 258 - 258
Roy Tucker 83 - 83 135 - 135
Andrew Hall 162 14 176 75 10 85
Total 953 15 968 934 17 951
* The Company has developed a practice of deferring payment of varying
proportions of sums earned by Directors until the Company liquidity position
improves.
As at 30 April 2023 a total of US$1,052,484 was owed to Directors (Brian
Moritz – US$116,763, Nick Hatch – US$104,666, Roy Tucker US$282,318, Nigel
Wyatt – US$46,721, Paul Fletcher US$245,231, Andrew Prelea US$106,280, Craig
Harvey US$138,920, and Andrew Hall – US$11,585). As at 30 April 2022 a total
of US$647,230 was owed to the Directors (Brain Moritz - US$88,442, Nick Hatch
- US$78,040, Roy Tucker - US$222,463, Nigel Wyatt - US$20,095, Paul Fletcher -
US$90,453, Andrew Prelea - US$83,059, Craig Harvey - US$56,960, and Andrew
Hall - US$7,718).
Future developments
The Company’s plans for future developments are more fully set down in the
Strategic Report, on pages 7 to 18.
Research and development
The Company has assessed the suitability of X-Ray Sorting Technology
(‘XRT’) to optimise the production profile of BPPM. The test results
received from TOMRA indicate that the implementation of XRT equipment
significantly improves the economics of the mine.
The Company began a drilling campaign at BPPM with the objective of
establishing an enlarged JORC compliant Mineral Resource potentially upgrading
the existing Mineral Resource with the inclusion of a JORC compliant
Exploration Target of 11.65 to 12.65 million tonnes. Initial results received
after the year end were very encouraging confirming the potential to extend
the mining area.
Disabled employees
The Group gives full consideration to applications for employment from
disabled persons where the candidate’s particular aptitudes and abilities
are consistent with adequately meeting the requirements of the job.
Opportunities are available to disabled employees for training, career
development and promotion.
Where existing employees become disabled, it is the Company’s policy to
provide continuing employment wherever practicable in the same or an
alternative position and to provide appropriate training to achieve this aim.
Streamlined Energy and Carbon Reporting (SECR) regulations
The Company did not consume more than 40,000kWh of energy in the UK in the
reporting period and is therefore exempt from reporting under these
regulations.
Auditors
All of the current Directors have taken all the steps that they ought to have
taken to make themselves aware of any information needed by the Group's
auditors for the purposes of their audit and to establish that the auditors
are aware of that information. The Directors are not aware of any relevant
audit information of which the auditors are unaware. Vast’s auditor, Crowe
U.K. LLP, was initially appointed on 25 April 2016 and it is proposed by the
Board that they be reappointed as auditors at the forthcoming AGM.
Events after the reporting date
These are more fully disclosed in Note 28.
By order of the Board
Ben Harber
Secretary
30 October 2023
Statement of Directors' responsibilities
The Directors are responsible for preparing the Strategic Report, the
Directors' 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 elected to prepare the
financial statements in accordance with UK-adopted International Accounting
Standards and applicable law.
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 company and the group and of the profit or loss of the group
for that period. In preparing these financial statements, the Directors are
required to:
* select suitable accounting policies and then apply them consistently;
* make judgments and accounting estimates that are reasonable and prudent;
* state whether applicable accounting standards have been followed, 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 company will continue in business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Group’s transactions and disclose with
reasonable accuracy at any time the financial position of the Group 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
hence for taking reasonable steps for the prevention and detection of fraud
and other irregularities.
They are further responsible for ensuring that the Strategic Report and the
Report of the Directors and other information included in the Annual Report
and Financial Statements is prepared in accordance with applicable law in the
United Kingdom.
The maintenance and integrity of the Group’s website is the responsibility
of the Directors.
Legislation in the United Kingdom governing the preparation and dissemination
of the accounts and the other information included in annual reports may
differ from legislation in other jurisdictions.
Independent Auditor’s Report to the Members of Vast Resources Plc
Opinion
We have audited the financial statements of Vast Resources plc (the “Parent
Company”) and its subsidiaries (the “Group”) for the year ended 30 April
2023, which comprise:
* the Group statement of comprehensive income for the year ended 30 April
2023;
* the Group and Parent Company statements of changes in equity for the year
ended 30 April 2023
* the Group and Parent Company statements of financial position as at 30 April
2023;
* the Group and Parent Company statements of cash flows for the year then
ended; and
* the notes to the financial statements, including a summary of significant
accounting policies.
The financial reporting framework that has been applied in the preparation of
the financial statements is applicable law and UK-adopted International
Accounting Standards.
In our opinion the financial statements:
* give a true and fair view of the state of the Group’s and of the Parent
Company's affairs as at 30 April 2023 and of the Group’s loss for the period
then ended;
* have been properly prepared in accordance with UK-adopted International
Accounting Standards; and
* 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 the 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 the basis of preparation and going concern assessment
note on page 34 in the financial statements, which indicates the Group will
require funding for general working capital and to repay the debts owed to
Mercuria Energy Trading SA (Mercuria) and A&T Investments Sarl (“Alpha”)
by 30 November 2023. Whilst the Group continues progress with the realisation
of the proceeds associated with a historic claim, there is ongoing discussion
with investor and debt providers for alternative funding arrangements beyond
30 November 2023, but no binding agreements are in place. As stated in this
note, these events or conditions, along with the other matters as set forth in
the note, indicate that a material uncertainty exists that may cast
significant doubt on the Group’s and Parent Company’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 directors 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 and entity’s ability to continue to adopt the going concern basis
of accounting included:
* We obtained managements going concern assessment, assessed the
appropriateness of the approach and tested the mathematical accuracy of the
model;
* We assessed the accuracy of management’s past forecasting for the previous
financial years by comparing management’s forecasts to actual results for
those years and have considered the impact on the working capital forecast;
* We assessed and challenged the key assumptions into the model including
metal prices, operating expenditure and production volumes and agreeing to
forecast data;
* We reviewed management’s assessment regarding the material uncertainty
disclosed in the basis of preparation and going concern assessment and
considered the impact the quantum and timing of these cashflow, together with
actions in the events that key financing events are delayed or do not occur;
and
* We assessed the adequacy of the disclosures made in the financial
statements.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Overview of our audit approach
Materiality
In planning and performing our audit we applied the concept of materiality. An
item is considered material if it could reasonably be expected to change the
economic decisions of a user of the financial statements. We used the concept
of materiality to both focus our testing and to evaluate the impact of
misstatements identified.
Based on our professional judgement, we determined overall materiality for the
Group financial statements as a whole to be $220,000 (2022: $210,000), based
on approximately 1% of the Group’s assets. Materiality for the Parent
Company financial statements as a whole was set at $130,000 (2022: $125,000),
based on approximately 5% of the Company’s normalised loss before tax.
We use a different level of materiality (‘performance materiality’) to
determine the extent of our testing for the audit of the financial statements.
Performance materiality is set based on the audit materiality as adjusted for
the judgements made as to the entity risk and our evaluation of the specific
risk of each audit area having regard to the internal control environment.
This is set at $154,000 (2022: $140,000) for the Group and $91,000 (2022:
$87,500) for the Parent Company.
Where considered appropriate performance materiality may be reduced to a lower
level, such as, for related party transactions and directors’ remuneration.
We agreed with the Audit and Compliance Committee to report to it all
identified errors in excess of $6,600 (2022: $6,000). Errors below that
threshold would also be reported to it if, in our opinion as auditor,
disclosure was required on qualitative grounds.
Overview of the scope of our audit
Of the Group’s reporting components, in addition to the Parent Company, we
identified two entities comprising one component requiring audit procedures to
be performed for group reporting purposes, the component is located in
Romania. The components within the scope of our work accounted for 100% of the
group’s total assets and 100% of the result for the period. The work on
these components was performed by local auditors under our direction and
review.
We issued instructions to the local auditors which included details of the
significant areas to be covered, including the key audit matters detailed
below, and the information required to be reported back. We reviewed the audit
work performed by the component auditors, communicated our findings therefrom
and any further work required by us was then performed by the local auditor.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, 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) that we identified. These matters
included 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 matter described in the ‘Material uncertainty related to
going concern section, we have determined the following key audit matters.
This is not a complete list of all risks identified by our audit.
Key audit matter How the scope of our audit addressed the key audit matter
Carrying value of property, plant and equipment At 30 April 2023 the group had property, plant and equipment of $17.8million (2022: $16.2million). The group incurred a loss from operations of $10.5 million (2022: $15.5 million) and therefore there could We obtained management’s impairment assessment of assets, reviewed the impairment model and discussed the key inputs into the model with management. We performed audit procedures, including applying challenge regarding the reasonableness on the inputs into the model as follows: * the forecast cash flows within the assessment period;
be evidence that these assets are impaired. * the expected margin and prevailing commodity prices:
* the discount rate applied to the forecast; and
* benchmarked the underlying key input assumption to the market information.
We tested the accuracy of management’s forecasting through a comparison of budget to actual data and historical variance trends. We considered and assessed the managements’ sensitivity analysis whether a reasonably possible change to a key input would result in an impairment charge. We also considered the disclosure made in the financial statements relating to impairments are appropriate.
Carrying value of investments and intercompany receivables – Parent Company The carrying value of investments in subsidiaries in the Parent Company financial statements at 30 April 2023 was $23.3million (2022: $23.3million) as well as intercompany We obtained management’s assessment of the impairment of investment in subsidiaries and the intercompany receivables. We considered the following matters: * Management’s assessment as to whether any indication of impairment existed. This includes considering the existence of any indication of discontinued activities, management’s future plans for the business, and the market capitalisation of the Group.
receivables of $33.5million (2022: $25.2million). The valuation of these investments and the recovery of the intercompany receivables are almost entirely dependent on the successful execution of the business plan. Failure to execute the business plan would * We reviewed management’s impairment model and discussed the key inputs into the model with management. This includes applying challenge regarding the reasonableness on the key inputs assumption used by management in assessing the forecast cashflows of the underlying assets in the subsidiary and thus the ability of the subsidiaries to generate profit and ultimately remit that to the Parent Company; and
likely result in an impairment to the carrying value of the investments in loans to subsidiaries. * We assessed the adequacy of the associated disclosure in the financial statements.
Our audit procedures in relation to these matters were designed in the context
of our audit opinion as a whole. They were not designed to enable us to
express an opinion on these matters individually and we express no such
opinion.
Other information
The directors are responsible for the other information contained within the
annual report. The other information comprises the information included in the
annual report, other than the financial statements and our auditor’s report
thereon. Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in our
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the 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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion based on the work undertaken in the course of our 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 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 where 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 the directors for the financial statements
As explained more fully in the directors’ responsibilities statement, the
directors are responsible for the preparation of the financial statements and
for being satisfied that they give a true and fair view, and for such internal
control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the Group’s and 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 legal and regulatory frameworks within
which the Group operates, focusing on those laws and regulations that have a
direct effect on the determination of material amounts and disclosures in the
financial statements. The laws and regulations we considered in this context
were relevant company law and taxation legislation in the UK and Romania being
the principal jurisdictions in which the Group operates.
We identified the greatest risk of material impact on the financial statements
from irregularities, including fraud, to be the override of controls by
management. Our audit procedures to respond to these risks included enquiries
of management about their own identification and assessment of the risks of
irregularities, sample testing on the posting of journals and reviewing
accounting estimates for biases in particular where significant judgements are
involved (see Key Audit Matters above).
Owing to the inherent limitations of an audit, there is an unavoidable risk
that some material misstatements of the financial statements may not be
detected, even though the audit is properly planned and performed in
accordance with the ISAs (UK).
The potential effects of inherent limitations are particularly significant in
the case of misstatement resulting from fraud because fraud may involve
sophisticated and carefully organised schemes designed to conceal it,
including deliberate failure to record transactions, collusion or intentional
misrepresentations being made to us.
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.
John Glasby (Senior Statutory Auditor)
for and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
30 October 2023
Group statement of comprehensive income
for the year ended 30 April 2023
30 Apr 2023 30 Apr 2022
12 Months 12 Months
Group Group
Note $’000 $’000
Revenue 3,720 3,781
Cost of sales (8,402) (7,403)
Gross loss (4,682) (3,622)
Overhead expenses (3,454) (9,380)
Depreciation of property, plant and equipment 2 (706) (812)
Share option and warrant expense 2, 23 (274) (356)
Sundry income (5) 59
Exchange gain / (loss) 2 1,411 (3,754)
Other administrative and overhead expenses (3,880) (4,517)
Fair value movement in available for sale investments - (3)
Loss from operations (8,136) (13,005)
Finance expense 4 (2,370) (2,487)
Loss before taxation from continuing operations (10,506) (15,492)
Taxation charge 5 - -
Total (loss) after taxation for the period (10,506) (15,492)
Other comprehensive income
Items that may be subsequently reclassified to either profit or loss
Exchange gain /(loss) on translation of foreign operations (1,197) 2,219
Total comprehensive expense for the period (11,703) (13,273)
(Loss) per share - basic and diluted - amount in cents ($) 8 (0.56) (5.73)
The accompanying accounting policies and notes on pages 34 to 66 of the annual
report form an integral part of these financial statements.
Group statement of changes in equity
for the year ended 30 April 2023
Share capital Share premium Share option reserve Foreign currency translation reserve Retained deficit Total
$’000 $’000 $’000 $’000 $’000 $’000
At 30 April 2021 41,092 89,348 2,982 (2,595) (121,709) 9,118
Total comprehensive loss for the period - - - 2,219 (15,492) (13,273)
Share option and warrant charges - - 356 - - 356
Share options and warrants lapsed - - (967) - 967 -
Share warrants issued under share issuance - (203) 203 - - -
Shares issued:
- for cash consideration 175 4,353 - - 4,528
- to settle liabilities 191 1,209 - - - 1,400
At 30 April 2022 41,458 94,707 2,574 (376) (136,234) 2,129
Total comprehensive loss for the period - - - (1,197) (10,506) (11,703)
Share option and warrant charges - - 274 - - 274
Share options and warrants lapsed - - (2,193) - 2,193 -
Share warrants issued to lender - - 277 - - 277
Shares issued:
- for cash consideration 2,285 7,531 - - 9,816
- to settle liabilities 630 1,120 - - - 1,750
At 30 April 2023 44,373 103,358 932 (1,573) (144,547) 2,543
The accompanying accounting policies and notes on pages 34 to 66 form an
integral part of these financial statements.
Company statement of changes in equity
for the year ended 30 April 2023
Share capital Share premium Share option reserve Foreign currency translation reserve Retained deficit Total
$’000 $’000 $’000 $’000 $’000 $’000
At 30 April 2021 41,092 89,348 2,982 (4,954) (87,779) 40,689
Total comprehensive loss for the period - - - - (3,448) (3,448)
Share option and warrant charges - - 356 - - 356
Share options and warrants lapsed - - (967) - 967 -
Share warrants issued under share issuance - (203) 203 - - -
Shares issued:
- for cash consideration 175 4,353 - - - 4,528
- to settle liabilities 191 1,209 - - - 1,400
At 30 April 2022 41,458 94,707 2,574 (4,954) (90,260) 43,525
Total comprehensive loss for the period - - - - (2,689) (2,689)
Share option and warrant charges - - 274 - - 274
Share options and warrants lapsed - - (2,193) - 2,193 -
Share warrants issued to lender - - 277 - - 277
Shares issued:
- for cash consideration 2,285 7,531 - - - 9,816
- to settle liabilities 630 1,120 - - - 1,750
At 30 April 2023 44,373 103,358 932 (4,954) (90,756) 52,953
The accompanying accounting policies and notes on pages 34 to 66 of the annual
report form an integral part of these financial statements.
Group and Company statements of financial position
As at 30 April 2023
30 Apr 2023 30 Apr 2022 30 Apr 2023 30 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Assets Note
Non-current assets
Property, plant and equipment 10 17,840 16,212 3 3
Available for sale investments 16 891 891 891 891
Investment in subsidiaries 11 - - 23,302 23,302
Investment in associates 12 417 417 417 417
Loans to group companies 13 - - 33,920 25,402
19,148 17,520 58,533 50,015
Current assets
Inventory 14 973 839 - -
Receivables 15 2,936 2,834 1,024 648
Cash and cash equivalents 530 103 460 86
Total current assets 4,439 3,776 1,484 734
Total Assets 23,587 21,296 60,017 50,749
Equity and Liabilities
Capital and reserves attributable to equity holders of the Parent
Share capital 22 44,373 41,458 44,373 41,458
Share premium 22 103,358 94,707 103,358 94,707
Share option reserve 932 2,574 932 2,574
Foreign currency translation reserve (1,573) (376) (4,954) (4,954)
Retained deficit (144,547) (136,234) (90,756) (90,260)
Total equity 2,543 2,129 52,953 43,525
Non-current liabilities
Provisions 19 1,165 1,145 - -
Trade and other payables 20 1,933 1,954 - -
3,098 3,099 - -
Current liabilities
Loans and borrowings 17 9,169 10,316 5,605 5,300
Trade and other payables 18 8,777 5,752 1,459 1,924
Total current liabilities 17,946 16,068 7,064 7,224
Total liabilities 21,044 19,167 7,064 7,224
Total Equity and Liabilities 23,587 21,296 60,017 50,749
The accompanying accounting policies and notes on pages 34 to 66 of the annual
report form an integral part of these financial statements. The parent Company
reported a loss after taxation for the year of US$ 2.689 million (2022: US$
3.448 million loss). The financial statements on pages 29 to 66 of the annual
report were approved and authorised for issue by the Board of Directors on 30
October 2023 and were signed on its behalf by:
Paul
Fletcher Registered
number 5414325
Director 30
October 2023
Group and Company statements of cash flow
for the year ended 30 April 2023
30 Apr 2023 30 Apr 2022 30 Apr 2023 30 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
CASH FLOW FROM OPERATING ACTIVITIES
Profit (loss) before taxation for the period (10,506) (15,492) (2,689) (3,448)
Adjustments for:
Depreciation 706 812 - -
Share option expense 274 356 274 356
Finance expense 2,370 2,487 1,597 1,979
Unrealised foreign currency exchange loss / (gain) (1,661) 3,946 - -
(8,817) (7,891) (818) (1,113)
Changes in working capital:
Decrease (increase) in receivables (101) 373 (376) (149)
Decrease (increase) in inventories (134) 97 - -
Increase (decrease) in payables 2,656 3,859 (465) 1,294
2,421 4,329 (841) 1,145
Taxation paid - - - -
Cash (used in) / generated by / operations (6,396) (3,562) (1,659) 32
Investing activities:
Payments to acquire property, plant and equipment (1,896) (1,467) - -
Disposal proceeds of property, plant and equipment 25 - - -
Payments to acquire investments in associates - (417) - (417)
Advanced loans to group companies - - (8,518) (5,029)
.
Total cash used in investing activities (1,871) (1,884) (8,518) (5,446)
Financing Activities:
Proceeds from the issue of ordinary shares 9,816 4,528 9,816 4,528
Proceeds from loans and borrowings granted 4,500 - 4,500 -
Repayment of loans and borrowings (5,622) (364) (3,765) (343)
Total proceeds from financing activities 8,694 4,164 10,551 4,185
Increase (decrease) in cash and cash equivalents 427 (1,282) 374 (1,229)
Cash and cash equivalents at beginning of period 103 1,385 86 1,315
Cash and cash equivalents at end of period 530 103 460 86
The accompanying notes and accounting policies on pages 34 to 66 of the annual
report form an integral part of these financial statements.
Statement of accounting policies
for the year ended 30 April 2023
General information
Vast Resources plc and its subsidiaries (together “the Group”) are engaged
principally in the exploration for and development of mineral projects in
Sub-Saharan Africa and Eastern Europe. Since incorporation the Group has built
an extensive and interesting portfolio of projects in these jurisdictions, and
has invested in a mineral mining project in Central Asia. The Company’s
ordinary shares are listed on the AIM market of the London Stock Exchange.
Vast Resources plc was incorporated as a public limited company under UK
Company Law with registered number 05414325. It is domiciled in England and
Wales with its registered office at 60 Gracechurch Street, London EC3V 0HR.
Basis of preparation and going concern assessment
The principal accounting policies adopted in the preparation of the financial
information are set out below. The policies have been consistently applied
throughout the current year and prior year, unless otherwise stated. These
financial statements have been prepared in accordance with UK-adopted
International Accounting Standards and the Companies Act 2006.
The financial statements are prepared under the historical cost convention on
a going concern basis. In certain prescribed circumstances the use of fair
value accounting has been adopted.
The Group made a loss for the year of $10.51 million (2022: $15.49 million).
The Group recorded net cash used in operating activities of $6.40 million
(2022: $3.56 million). At the reporting date the group held cash and cash
equivalents of $0.53 million (2022: $0.1 million) and had net current
liabilities of $13.51 million (2022: $12.29 million). Subsequent to the year
end, the Company raised $4.41 million from the placing of new shares for mine
operations, capital expenditure and general working capital.
The Company will require funding to repay the Mercuria and Alpha loans and to
provide general working capital. The original maturity date for these
facilities was 15 May 2023 and this has been extended on several occasions
with the current extension by mutual agreement running to 30 November 2023.
The Company has been in continuing discussions with Mercuria and Alpha for
extensions in the repayment date for the totality of the debt owed so as to
allow further time to realise the proceeds associated with a historic claim in
its operations. The Company expects these to repay both Mercuria and Alpha,
with the balance, together possibly with an element of debt financing in
discussion, to provide necessary funds for working capital and BPPM expansion
purposes. At the date of this Report the Company expects the historic claim
proceeds receipt very shortly, although there can be no certainty as to the
precise date. While management is confident that with continued progress in
the realisation process Mercuria and Alpha would remain supportive beyond 30
November, the Company is also in discussions with investors and debt providers
to provide funding after 30 November. At the date of this report, there is
neither a legally binding extension of the Mercuria and Alpha loans beyond 30
November nor alternative legally binding funding arrangements. These
conditions indicate the existence of a material uncertainty which may cast
significant doubt about the Group's and Company's ability to continue as a
going concern. The financial statements do not include the adjustment that
would result if the Group and Company were unable to continue as a going
concern.
Changes in Accounting Policies
At the date of authorisation of these financial statements, a number of
Standards and Interpretations were in issue and effective for the first time
this financial year. The Directors do not anticipate that the adoption of
these standards and interpretations, or any of the amendments made to existing
standards as a result of the annual improvements cycle, will have a material
effect on the financial statements in the year of initial application.
Areas of estimates and judgement
The preparation of the Group financial statements in conformity with UK
adopted International Accounting Standards (UK IAS) requires the use of
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Although these estimates are based on
management’s best knowledge of current events and actions, actual results
may ultimately differ from those estimates. The estimates and assumptions that
have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities in the next financial year are discussed
below:
Accounting estimates
a) Impairment of mining assets
The Group reviews, on an annual basis, whether deferred exploration costs,
acquired either as intangible assets, as property, plant and equipment, or as
mining options or licence acquisition costs, have suffered any impairment. The
recoverable amounts are determined based on an assessment of the economically
recoverable mineral reserves, the ability of the Group to obtain the necessary
financing to complete the development of the reserves and future profitable
production or proceeds from the disposition of recoverable reserves.
The Group uses discounted cash flow techniques (“DCF”) and, as relevant
industry benchmarks, to assess whether any impairment is necessary. Revenue
projections used in DCF are based on production plans associated with the
Company’s estimate of economically recoverable mineral reserves and are
modelled using prevailing commodity market prices with an appropriate down
stress applied. Production cost inputs used in DCF are referenced to
observable inputs in accordance with the production plan and are applied
conservatively. The Group applies a pre-tax discount rate of 15% in its DCF
modelling, reflecting its assessment of the market cost of capital for such
assets under the Capital Asset Pricing Model (“CAPM”). The results of
these assessments indicate that the fair value of the Group’s mining assets
is significantly more than their carry value. There have been no fundamental
changes in the quality and condition of these assets versus the previous year.
The Group also sensitised a reasonable possible movement in key assumptions
such as a reduction of forecast commodity prices by up to 15% and a higher
discount rate up to 20%. Under these scenarios, there are no impairment
indictors identified.
The mining assets are disclosed in note 10 to the financial statements.
b) Provisions
The Group is required to estimate the cost of its obligations to realise and
rehabilitate its mining properties.
The estimation of the cost of complying with the Group’s obligations at
future dates and in economically unpredictable regions, and the application of
appropriate discount rates thereto, gives rise to significant estimation
uncertainties.
Accounting judgements
c) Going concern and the Company’s Inter-company loan
recoverability
The recoverability of inter-company loans advanced by the Company to
subsidiaries depends also on the subsidiaries realising their cash flow
projections, which is linked to the future cashflows expected to be generated
from certain underlying assets of the Company’s subsidiaries which are
predominantly the mining assets within the property, plant and equipment
assets. The going concern considerations are highlighted above. The results of
these assessments indicate that the recoverable amount of these mining assets
are significantly more than the carrying value of the Company’s loans to its
subsidiaries.
d) VAT recoverable
In countries where the Group has productive mining operations carried out by
its subsidiaries those subsidiaries are registered for Value Added Tax (VAT)
with their respective local taxation authorities and, as their outputs are
predominantly zero-rated for VAT, receive net refunds of VAT in respect of
input tax borne on their inputs. This amount is carried as a receivable until
refunded by the State.
The amount carried as a receivable is determined in accordance with the
returns submitted to the taxation authorities.
Basis of consolidation
Where the Company has control over an investee, it is classified as a
subsidiary. The Company controls an investee if all three of the following
elements are present: power over the investee, exposure to variable returns
from the investee, and the ability of the investor to use its power to affect
those variable returns. Control is reassessed whenever facts and circumstances
indicate that there may be a change in any of these elements of control.
The consolidated financial statements present the results of the Company and
its subsidiaries ("the Group") as if they formed a single entity.
Inter-company transactions and balances between Group companies are therefore
eliminated in full.
The consolidated financial statements incorporate the results of business
combinations using the acquisition method. In the statement of financial
position, the acquiree's identifiable assets, liabilities and contingent
liabilities are initially recognised at their fair values at the acquisition
date. The results of acquired operations are included in the consolidated
statement of comprehensive income from the date on which control is obtained.
They are deconsolidated from the date on which control ceases.
Financial instruments
The Group’s principal financial assets are cash and cash equivalents and
receivables. The Group also holds a long-term investment available for sale.
The Group’s principal financial liabilities are trade and other payables,
and loans and borrowings.
The Group's accounting policy for each category of financial asset is as
follows:
Financial assets held at amortised cost
Trade receivables and other receivables are classified as financial assets
held at amortised cost as they are held within a business model whose
objective is to collect contractual cashflows which are solely payments of
principal and interest. 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
rate method, less provision for impairment.
Impairment provisions are recognised under the expected loss model with
changes in the provision being recorded in the statement of comprehensive
income. For receivables, which are reported net, such provisions are recorded
in a separate allowance account with the loss being recognised within
administrative expenses in the statement of comprehensive income. On
confirmation that the receivable will not be collectable, the gross carrying
value of the asset is written off against the associated provision.
Financial assets held at fair value
Financial assets held for trading are measured at fair value through the
profit and loss account as their value will be recovered through sale.
Cash and cash equivalents
These amounts comprise cash on hand and balances with banks. Cash equivalents
are short term, highly liquid accounts that are readily converted to known
amounts of cash. They include short-term bank deposits.
Financial liabilities
The Group’s financial liabilities consist of trade and other payables
(including short terms loans) and long term secured borrowings. These are
initially recognised at fair value and subsequently carried at amortised cost,
using the effective interest method. Where any liability carries a right to
convertibility into shares in the Group and the Group has an unconditional
right to avoid delivering cash, the fair value of the equity and liability
portions of the liability is determined at the date that the convertible
instrument is issued, by use of appropriate discount factors.
Foreign currency
The functional currency of the Company and all of its subsidiaries outside
Romania is the United States Dollar, while the functional currency of the
Company’s Romanian subsidiaries is the Romanian Lei (RON). These are the
currencies of the primary economic environment in which the Company and its
subsidiaries operate.
Transactions entered into by the Group entities in a currency other than the
currency of the primary economic environment in which it operates (the
“functional currency”) are recorded at the rates ruling when the
transactions occur. Foreign currency monetary assets and liabilities are
translated at the rates ruling at the date of the statement of financial
position. Exchange differences arising on the retranslation of unsettled
monetary assets and liabilities are similarly recognised immediately in profit
or loss.
For consolidation purposes, the results and financial position of a Group
entity whose functional currency differs from the Group’s presentation
currency is translated into the Group’s presentation currency as follows:
assets and liabilities are translated at the closing rate; income and expenses
are translated at the average rate for the period, and; all resulting exchange
differences are recognised in other comprehensive income.
The exchange rates applied at each reporting date were as follows:
* 30 April 2023 $1.2568:
£1 and $1: RON 4.4915 and $1:
ZWL 1,047.44
* 30 April 2022 $1.2572:
£1 and $1: RON 4.6774 and $1:
ZWL 159.35
* 30 April 2021 $1.3818:
£1 and $1: RON 4.0621 and $1: ZWL 85.75
On 22 February 2019 all United States dollar balances in Zimbabwe were
restated as RTGS (Real Time Gross Settlement) balances, later renamed Zimbabwe
Dollar (ZWL), as a separate and distinct currency tradeable against the US
dollar. On 27 March 2020 the Government of Zimbabwe pegged the rate of
exchange at $1: 25. Subsequently, the ZWL has depreciated significantly. This
has an immaterial impact on the balance sheet and profit and loss for the year
ended 30 April 2023 and for the ongoing financial position of our operations
in Zimbabwe.
Intangible assets - Mining rights
Mineral rights are recorded at cost less amortisation and provision for
diminution in value. Amortisation will be over the estimated life of the
commercial ore reserves on a unit of production basis.
Licences for the exploration of natural resources will be amortised over the
lower of the life of the licence and the estimated life of the commercial ore
reserves on a unit of production basis.
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of
cost and net realisable value. Cost comprises all costs of purchase, costs of
conversion and other costs incurred in bringing the inventories to their
present location and condition. Weighted average cost is used to determine the
cost of ordinarily inter-changeable items.
Mining inventory includes run of mine stockpiles, minerals in circuit,
finished goods and consumables. Stockpiles, minerals in circuit and finished
goods are valued at their cost of production to their point in process using a
weighted average cost of production, or net realisable value, whichever is the
lower. Low grade stockpiles are only recognised as an asset when there is
evidence to support the fact that some economic benefit will flow to the
Company on the sale of such inventory. Consumables are valued at their cost of
acquisition, or net realisable value, whichever is the lower.
Investment in subsidiaries and associates
The Company’s investment in its subsidiaries and associates is recorded at
cost less any impairment.
Associates
Where the Group has the power to participate in (but not control) the
financial and operating policy decisions of another entity, it is classified
as an associate. Associates are initially recognised in the consolidated
statement of financial position at cost. Subsequently associates are accounted
for using the equity method, where the Group's share of post-acquisition
profits and losses and other comprehensive income is recognised in the
consolidated statement of profit and loss and other comprehensive income
(except for losses in excess of the Group's investment in the associate unless
there is an obligation to make good those losses).
Profits and losses arising on transactions between the Group and its
associates are recognised only to the extent of unrelated investors' interests
in the associate. The investor's share in the associate's profits and losses
resulting from these transactions is eliminated against the carrying value of
the associate. Any premium paid for an associate above the fair value of the
Group's share of the identifiable assets, liabilities and contingent
liabilities acquired is recognised as goodwill and included in the carrying
amount of the associate. Where there is objective evidence that the investment
in an associate has been impaired the carrying amount of the investment is
tested for impairment in the same way as other non-financial assets.
Revenue
Revenue from the sales of goods is recognised when the Group has performed its
contractual obligations and it is probable that the Group will receive the
previously agreed upon payment. These criteria are considered to be met when
the goods are loaded at the plant and consigned to the buyer. Revenue for
services is recognised as those services are performed under contractual
obligations with the customer.
Under IFRS 15, the freight service on export commodity contracts with CIF/CFR
terms represents a separate performance obligation, and a portion of the
revenue earned under these contracts, representing the obligation to perform
the freight service, is deferred and recognised over time as this obligation
is fulfilled. The sale of concentrate, along with the associated costs, is
recognised at the point of time that the goods are delivered to the customer.
Provided the amount of revenue can be measured reliably and it is probable
that the Group will receive any consideration, revenue for services is
recognised in the period in which they are rendered.
Pension costs
Contributions to defined contribution pension schemes are charged to profit or
loss in the year to which they relate.
Production expenses
Production expenses include all direct costs of production but exclude
depreciation of property plant and equipment involved in the mining process,
and mine and Company overhead.
Property, plant, and equipment
Land is not depreciated. Items of property, plant and equipment are initially
recognised at cost and are subsequently carried at depreciated cost. As well
as the purchase price, cost includes directly attributable costs and the
estimated present value of any future costs of dismantling and removing items.
The corresponding liability is recognised within provisions.
Depreciation is provided on all other items of property and equipment so as to
write off the carrying value of items over their expected useful economic
lives. It is applied at the following rates:
Buildings – 2.5% per annum, straight line
Plant and machinery – 15% per annum, reducing
balance
Fixtures, fittings & equipment – 20% per
annum, reducing balance
Computer assets – 33.33% per annum, straight
line
Motor vehicles – 15% per annum, reducing
balance
Capital works in progress: Property, plant and equipment under construction
are carried at its accumulated cost of construction and not depreciated until
such time as construction is completed or the asset put into use, whichever is
the earlier.
Proved mining properties
Depletion and amortisation of the full-cost pools is computed using the
units-of-production method based on proved reserves as determined annually by
management.
Provision for rehabilitation of mining assets
Provision for the rehabilitation of a mining property on the cessation of
mining is recognised from the commencement of mining activities. This
provision accounts for the full cost to rehabilitate the mine according to
good practice guidelines in the country where the mine is located, which may
involve more than the stipulated minimum legal commitment.
When accounting for the provision the Company recognises a provision for the
full cost to rehabilitate the mine and a matching asset accounted for within
the non-current mining asset. The rehabilitation provision is discounted using
an appropriate discount rate, which is linked to the currency in which the
costs are expected to be incurred, and the applicable inflation rate applied
to the cash flows. The unwinding of the discounting effect is recognised
within finance expenses in the income statement.
Share based payments
Equity-settled share-based payments
Where share options are awarded to employees, the fair value of the options at
the date of grant is charged to profit or loss over the vesting period.
Non-market vesting conditions are taken into account by adjusting the number
of equity instruments expected to vest at each reporting date so that,
ultimately, the cumulative amount recognised over the vesting period is based
on the number of options that eventually vest.
Where the terms and conditions of options are modified before they vest, the
increase in the fair value of the options, measured immediately before and
after the modification, is also charged to profit or loss over the remaining
vesting period.
Where equity instruments are granted to persons other than employees, the fair
value of goods and services received is charged to profit or loss, except
where it is in respect to costs associated with the issue of shares, in which
case, it is charged to the share premium account.
Remuneration shares
Where remuneration shares are issued to settle liabilities to employees and
consultants, any difference between the fair value of the shares on the date
of issue and the carrying amount of the liability is charged to profit or
loss.
Stripping costs
Costs incurred in stripping the overburden to gain access to mineral ore
deposits are accounted for as follows:
Stripping costs incurred during the development phase of the mine (before
production begins) are capitalised as part of the depreciable cost of
building, developing and constructing the mine. Capitalised costs are
amortised using the units of production method, once production begins.
Stripping costs incurred during the production phase of the mine which give
rise to the production of usable inventory are accounted for in accordance
with the principles contained in the Group’s policy on
Inventories. Stripping costs incurred in the production phase of the mine
which result in improved access to ore are capitalized and recognized as
additions to non-current assets provided that it is probable that the future
economic benefit from improved access to the ore body associated with the
stripping activity will flow to the Company, that it is possible to identify
the component of the ore body to which access has been improved and that the
costs relating to the stripping activity associated with that component of the
ore body can be measured reliably.
Tax
The major components of income tax on the profit or loss include current and
deferred tax.
Current tax
Current tax is based on the profit or loss adjusted for items that are
non-assessable or disallowed and is calculated using tax rates that have been
enacted or substantively enacted by the reporting date.
Tax is charged or credited to the statement of comprehensive income, except
when the tax relates to items credited or charged directly to equity, in which
case the tax is also dealt with in equity.
Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount
of an asset or liability in the statement of financial position differs to its
tax base, except for differences arising on:
* The initial recognition of goodwill;
* The initial recognition of an asset or liability in a transaction which is
not a business combination and at the time of the transaction affects neither
accounting or taxable profit; and
* Investments in subsidiaries and jointly controlled entities where the Group
is able to control the timing of the reversal of the difference and it is
probable that the differences will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it
is probable that taxable profit will be available against which the difference
can be utilised.
The amount of the asset or liability is determined using tax rates that have
been enacted or substantively enacted by the reporting date and are expected
to apply when deferred tax liabilities/(assets) are settled/(recovered).
Deferred tax balances are not discounted.
New IFRS accounting standards
A number of new standards and amendments to standards and interpretations have
been issued but are not yet effective.
At the date of authorisation of these financial statements, the Directors have
reviewed the standards in issue by the UK Endorsement Board (“UKEB”),
which are effective for annual accounting periods ending on or after the
stated effective date. In their view, none of these standards would have a
material impact on the consolidated financial statements.
Notes to financial statements
for the year ended 30 April 2023
1 Segmental analysis
The Group operates in one business segment, the development and mining of
mineral assets. The Group has interests in two geographical segments being
Southern Africa (primarily Zimbabwe) and Europe and Central Asia (primarily
Romania and Tajikistan focusing on polymetallic opportunities). The group
combines its Tajikistan and Romanian operations into one geographical segment,
Europe and Central Asia, as these operations are managed together as a single
geography utilising common resources and leveraging commercial and strategic
synergies.
The Group’s operations are reviewed by the Board (which is considered to be
the Chief Operating Decision Maker (‘CODM’)) and split between mining
exploration and development and administration and corporate costs.
Exploration and development is reported to the CODM only on the basis of those
costs incurred directly on projects. All costs incurred on the projects are
capitalised in accordance with IFRS 6, including depreciation charges in
respect of tangible assets used on the projects.
Administration and corporate costs are further reviewed on the basis of spend
across the Group.
Decisions are made about where to allocate cash resources based on the status
of each project and according to the Group’s strategy to develop the
projects. Each project, if taken into commercial development, has the
potential to be a separate operating segment. Operating segments are disclosed
below on the basis of the split between exploration and development and
administration and corporate.
Revenue comprises of the sale of concentrates of $2.66million (2022:
$2.25million) and services rendered of $1.06million (2022: $1.53million). The
Group derives revenue from two customers (2022: two), each exceeding 10% of
total revenues.
Mining, exploration, and development Admin and corporate Total
Europe & Central Asia Africa
$’000 $’000 $’000 $’000
Year to 30 April 2022
Revenue 3,720 - - 3,720
Production costs (8,402) - - (8,402)
Gross profit (loss) (4,682) - - (4,682)
Depreciation (704) - (2) (706)
Share option and warrant expense - - (274) (274)
Sundry income (5) - - (5)
Exchange (loss) gain 1,098 - 313 1,411
Other administrative and overhead expenses (2,165) - (1,715) (3,880)
Finance expense (775) - (1,595) (2,370)
Taxation (charge) - - - -
Profit (loss) for the year (7,233) - (3,273) (10,506)
30 April 2022
Total assets 22,290 - 1,297 23,587
Total non-current assets 17,916 - 1,232 19,148
Additions to non-current assets 1,595 - 301 1,896
Total current assets 4,374 - 65 4,439
Total liabilities 13,937 - 7,107 21,044
Mining, exploration, and development Admin and corporate Total
Europe & Central Asia Africa
$’000 $’000 $’000 $’000
Year to 30 April 2022
Revenue 3,781 - - 3,781
Production costs (7,403) - - (7,403)
Gross profit (loss) (3,622) - - (3,622)
Depreciation (806) - (6) (812)
Share option and warrant expense - - (356) (356)
Sundry income 59 - - 59
Exchange (loss) gain (3,359) - (395) (3,754)
Other administrative and overhead expenses (2,565) - (1,952) (4,517)
Fair value movement in available for sale investments - - (3) (3)
Finance expense (508) - (1,979) (2,487)
Taxation (charge) - - - -
Profit (loss) for the year (10,801) - (4,691) (15,492)
30 April 2022
Total assets 19,614 - 1,682 21,296
Total non-current assets 16,549 - 971 17,520
Additions to non-current assets 1,467 - - 1,467
Total current assets 3,065 - 711 3,776
Total liabilities 11,938 - 7,229 19,167
2 Group loss from operations
2023 2022
Group Group
$’000 $’000
Operating loss is stated after charging/ (crediting):
Auditors' remuneration (note 3) 99 91
Depreciation 706 812
Employee pension costs 353 283
Share option expense 274 356
Foreign exchange (gain) / loss (1,411) 3,754
3 Auditor’s remuneration
2023 2022
Group Group
$’000 $’000
Fees payable to the Company's auditor for the audit of the Company's annual accounts 67 60
Fees payable to the Company's auditor for other services:
- Audit of the accounts of subsidiaries 32 31
- Other services - -
99 91
4 Finance expense
Finance expense 2023 2022
Group Group
$’000 $’000
Finance expense on secured borrowings 1,572 2,473
Finance expense on unsecured borrowings 430 14
Finance charges on taxes payable (note 20) 368 -
2,370 2,487
5 Taxation
2023 2022
Group Group
$’000 $’000
Income tax on profits - -
Deferred tax charge - -
Tax charge (credit) - -
2023 2022
Group Group
$’000 $’000
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The differences are explained as follows:
Loss before taxation (10,506) (15,492)
Loss before taxation at the standard rate of corporation tax in the UK of 19% (2023: 19%) 1,992 2,943
Difference in tax rates in foreign jurisdictions (249) (348)
Income not chargeable to tax 46 -
Expenses not allowed for tax 650 304
Short term timing differences 7 14
Loss carried forward (2,446) (2,913)
Income tax charge on profits - -
There was no taxation charge during the year (2022: US$ nil).
Deferred tax assets are only recognised in the Group where the company
concerned has a reasonable expectation of future profits against which the
deferred tax asset may be recovered.
Tax losses 2023 2022 2023 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Accumulated tax losses 81,378 65,240 43,061 40,649
However, these losses will only be recoverable against future profits, the
timing of which is uncertain, and a deferred tax asset has not been recognised
in respect of these losses. A deferred tax asset has not been recognised in
respect of accumulated tax losses for the Company.
6 Employees
2023 2022
Group Group
$’000 $’000
Staff costs (including directors) consist of:
Wages and salaries – management 1,350 1,318
Wages and salaries – other 6,095 5,712
7,445 7,030
Consultancy fees 20 185
Social Security costs 28 64
Healthcare costs 18 -
Pension costs 353 283
7,864 7,562
The average number of employees (including directors) during the year was as follows:
Management 14 15
Other operations 336 352
350 367
7 Directors’ remuneration
2023 2022
Group Group
$’000 $’000
Directors’ emoluments 953 934
Company contributions to pension schemes 12 17
Healthcare costs 3 -
Termination payments - -
Directors and key management remuneration 968 951
The Directors are considered to be the key management of the Group and
Company. The highest paid Director received an amount of $257,628 (2022:
$258,259).
Five of the Directors at the end of the period have share options receivable
under long term incentive schemes.
8 Earnings per share
30 Apr 2023 30 Apr 2022
Group Group
Profit and loss per ordinary share has been calculated using the weighted average number of ordinary shares in issue during the relevant financial year.
The weighted average number of ordinary shares in issue for the period is: 1,862,916,300 270,291,660
Profit / (loss) for the period: ($’000) (10,506) (15,492)
Profit / (Loss) per share basic and diluted (cents) (0.56) (5.73)
The effect of all potentially dilutive share options is anti-dilutive.
9 Loss for the financial year
The Company has adopted the exemption allowed under Section 408(1b) of the
Companies Act 2006 and has not presented its own income statement in these
financial statements.
10 Property, plant, and equipment
Group Plant and machinery $’000 Fixtures, fittings and equipment $’000 Computer assets $’000 Motor vehicles $’000 Buildings and Improvements $’000 Mining assets $’000 Capital Work in progress $’000 Total $’000
Cost at 1 May 2021 4,554 75 165 738 3,326 12,128 2,743 23,729
Additions during the period 28 5 12 45 - 256 1,121 1,467
Reclassification (568) 2 - 98 168 892 (592) -
Foreign exchange movements (571) (10) (17) (118) (348) (1,206) (289) (2,559)
Cost at 30 April 2022 3,443 72 160 763 3,146 12,070 2,983 22,637
Additions during the year 10 - - - - 177 1,709 1,896
Reclassification 443 - - 303 - 691 (1,437) -
Disposals during the year (5) - - (37) - - - (42)
Foreign exchange movements 134 3 4 40 102 367 79 729
Cost at 30 April 2023 4,025 75 164 1,069 3,248 13,305 3,334 25,220
Depreciation at 1 May 2021 2,949 65 100 225 1,089 1,413 604 6,445
Charge for the year 281 14 16 27 138 336 - 812
Reclassification - (4) 4 - - - - -
Foreign exchange movements (392) (10) (13) (62) (190) (165) - (832)
Depreciation at 30 April 2022 2,838 65 107 190 1,037 1,584 604 6,425
Charge for the year 262 8 10 61 86 279 - 706
Reclassification - (4) 4 - - - - -
Disposals during the year (1) - - (16) - - - (17)
Foreign exchange movements 120 2 4 19 59 62 - 266
Depreciation at 30 April 2023 3,219 71 125 254 1,182 1,925 604 7,380
Net book value at 1 May 2021 1,605 10 65 513 2,237 10,715 2,139 17,284
Net book value at 30 April 2022 605 7 53 573 2,109 10,486 2,379 16,212
Net book value at 30 April 2023 806 4 39 815 2,066 11,380 2,730 17,840
10 Property, plant, and equipment (cont.)
Company Plant and machinery Fixtures, fittings and equipment Computer assets Total
$’000 $’000 $’000 $’000
Cost at 30 April 2021 30 5 28 63
Additions during the period - - - -
Disposals during the period - - - -
Cost at 30 April 2022 30 5 28 63
Additions during the year - - - -
Disposals during the year - - - -
Cost at 30 April 2023 30 5 28 63
Depreciation at 30 April 2021 30 5 24 59
Charge for the period - - 1 1
Disposals during the period - - - -
Depreciation at 30 April 2022 30 5 25 60
Charge for the year - - - -
Disposals during the year - - - -
Depreciation at 30 April 2023 30 5 25 60
Net book value at 30 April 2022 - - 3 3
Net book value at 30 April 2023 - - 3 3
11 Investments in subsidiaries
2023 2022
Company Company
$’000 $’000
Cost at the beginning of the year 23,302 23,302
Additions during the year - -
Cost at the end of the year 23,302 23,302
The principal subsidiaries of Vast Resources plc, all of which are included in
these consolidated Annual Financial Statements, are as follows:
Company Country of registration Class Proportion held by group Nature of business
2023 2022
Vast Baita Plai SA (formerly African Consolidated Resources SRL) Romania Ordinary 100% 100% Mining exploration and development
Sinarom Mining Group SRL Romania Ordinary 100% 100% Mining exploration and development
Vast Resources Romania Ltd United Kingdom Ordinary 100% 100% Holding company
Vast Resources Zimbabwe (Private) Limited Zimbabwe Ordinary 100% 100% Mining exploration and development
The table above shows the principal subsidiaries of the Company. A full list
of all group subsidiaries is given in Note 29, at the end of this report.
12 Investment in associates
Investment in associates comprises the acquisition cost of an effective
interest of 24.5% in Central Asia Minerals and Metals Ore Trading FZCO
(“CAMM”).
13 Loans to group companies
Loans to Group companies are repayable on demand. The treatment of this
balance as non-current reflects the Company’s expectation of the timing of
receipt. Recoverability of these balances is linked to the future cashflows
expected to be generated from certain underlying assets of the Company’s
subsidiaries which are predominantly property, plant and equipment assets. The
recoverable amount of these underlying assets is determined based on an
assessment of the economically recoverable mineral reserves, the ability of
the subsidiaries to complete the development of the reserves and future
profitable production or proceeds from the disposition of the recoverable
reserves. Based on this review, the carrying value of these underlying assets
was not impaired and there were no indications the subsidiaries would be
unable to repay any borrowing obligations. Accordingly, no impairment was
recognised in these financial statements.
14 Inventory
Apr 2023 Apr 2022 Apr 2023 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Minerals held for sale 402 185 - -
Production stockpiles 6 6 - -
Consumable stores 565 648 - -
973 839 - -
During the year, US$8.402 million (2022: US$7.403 million) inventories
relating to revenue were recognised as costs in the income statement.
15 Receivables
Apr 2023 Apr 2022 Apr 2023 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Trade receivables 215 151 - -
Other receivables 1,624 1,658 653 268
Short term loans 335 312 269 246
Prepayments 125 183 71 118
VAT 637 530 31 16
2,936 2,834 1,024 648
Of which: Of which: not impaired as at 30 April 2023 and past due in the following periods:
Carrying amount before deducting any impairment loss Related Impairment loss Net carrying amount Neither impaired nor past due on 30 April 2023 Not more than three months More than three months and not more than six months More than six months
Trade receivables 215 - 215 - 79 116 20
Other receivables 1,624 - 1,624 1,617 - - 7
1,839 - 1,839 1,617 79 116 27
At the reporting date, included within VAT receivable is an amount in respect
of VAT owed to Vast Baita Plai SA (formerly African Consolidated Resources
SRL) of US$ 450,678 (RON 2,024,222). The amount represents VAT paid on the
Baita Plai Mine’s care operations. As reported previously, ANAF, the
Romanian revenue authority had refused to accept amounts included in this
balance as a legitimate VAT receivable as a mining licence was not then in
place for Baita Plai Mine. On 15th October 2018, the mining licence was
granted. The Romanian Courts ruled in favour of the Company and the tax
authorities have appealed against the decision. The Company continues to
maintain that the case has no merit.
16 Available for sale investments
In the year to 30 April 2020, the Company acquired an investment in the
Convertible 15% Loan Notes of EMA of principal value US$750,000. The
transaction value was US$891,164. These notes fund EMA’s and Blueberry’s
working capital and capital expenditure requirements in relation to
exploration at the Blueberry mine and other matters necessary for the purpose
of achieving an IPO. The conversion feature of the loan notes allows the
holder to convert every US$ 10,000 of principal into 0.075% of shares at the
time of the IPO. These notes are held for sale and are carried at fair value
through the profit and loss account as their value will be recovered through
sale. Management is targeting a sale in the financial year ended 30 April 2025
and has therefore classified the investment in non-current assets. The project
is its early stages of development and there is insufficient more recent
information to reliably measure the fair value of the project, on the basis
management consider cost to be the best estimate of fair value of the
instrument.
17 Loans and borrowings
Apr 2023 Apr 2022 Apr 2023 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Non-current
Secured borrowings 8,213 10,075 4,666 5,100
Unsecured borrowings 728 - 728 -
less amounts payable in less than 12 months (8,941) (10,075) (5,394) (5,100)
- - - -
Current
Secured borrowings - - - -
Unsecured borrowings 227 240 210 199
Bank overdrafts 1 1 1 1
Current portion of long-term borrowings - secured 8,213 10,075 4,666 5,100
- unsecured 728 - 728 -
9,169 10,316 5,605 5,300
Total loans and borrowings 9,169 10,316 5,605 5,300
Current secured borrowings consist of:
* US$3,546,600 (2022: US$4,975,129) secured offtake finance from Mercuria
Energy Trading SA. The loan is secured by a charge on the assets held by
Sinarom Mining Group SRL which is the holder of the rights to the Manaila Mine
and by a pledge on the shares of Vast Resources PLC 100% holding. The loan
bore floating rate interest during the period of 10.7%. The repayment of the
loan is to be made from surplus cashflows generated from BPPM.
* US$4,665,643 (2022: US$NIL) secured finance from A&T Investments Sarl
(‘Alpha’). The loan has a 12 month term and a fixed rate of interest of
20%. The loan and interest were originally due for repayment on 15 May 2023
and has been extended to 30 November 2023. Alpha has been granted first lien
security over a real estate asset in Bucharest, Romania, in order to provide
enhanced security. An existing shareholder of the Company has been granted a
first ranking security over the Baita Plai Polymetallic Mine (‘BBPM’) in
return for allowing this asset to be used as enhanced collateral. Alpha has
been granted a second ranking security over BPPM.
* During the year, the Company settled the convertible bond from Atlas Capital
Markets Limited, amounting to US$5,100,000.
Current unsecured borrowing consists of:
* US$17,781 (2022: US$40,753) loans owed to the former non-controlling
interests in Vast Baita Plai SA. These include amounts owed to the following
director: Roy Tucker (US$5,766). These loans are interest free and have no
fixed terms of repayment. There is no expectation that these loans will be
called in the short-term.
* US$937,995 (2022: US$199,266) of third-party loans comprising a loan from M
Semere of US$210,495 bearing an interest rate of 6%, a third-party loan of
US$625,000 bearing an interest rate of 10%, and a short-term third party loan
of US$102,500 which was repaid after the year-end. There is no expectation
that the outstanding loans will be called in the short-term.
Reconciliation of liabilities arising from financing activities
Non-cash changes
2023 Group 01-May-22 Cash -flows Amortised finance charges Loans repaid in shares Warrants issued 30-Apr-23
$'000s $'000s $'000s $'000s $’000s $'000s
Long-term borrowings - - -
Short-term borrowings 10,316 (1,122) 2,002 (1,750) (277) 9,169
Total liabilities
from financing activities 10,316 (1,122) 2,002 (1,750) (277) 9,169
Non-cash changes
2022 Group 01-May-21 Cash -flows Amortised finance charges Loans repaid in shares Warrants issued 30-Apr-22
$'000s $'000s $'000s $'000s $’000s $'000s
Long-term borrowings - - -
Short-term borrowings 9,593 (364) 2,487 (1,400) - 10,316
Total liabilities
from financing activities 9,593 (364) 2,487 (1,400) - 10,316
Non-cash changes
2023 Company 01-May-22 Cash -flows Amortised finance charges Loans repaid in shares Warrants issued 30-Apr-23
$'000s $'000s $'000s $'000s $'000s
Long-term borrowings - - - -
Short-term borrowings 5,300 735 1,597 (1,750) (277) 5,605
Total liabilities
from financing activities 5,300 735 1,597 (1,750) (277) 5,605
Non-cash changes
2022 Company 01-May-21 Cash -flows Amortised finance charges Loans repaid in shares Warrants issued 30-Apr-22
$'000s $'000s $'000s $'000s $'000s
Long-term borrowings - - - -
Short-term borrowings 5,064 (343) 1,979 (1,400) - 5,300
Total liabilities
from financing activities 5,064 (343) 1,979 (1,400) - 5,300
18 Trade and other payables
Apr 2023 Apr 2022 Apr 2023 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Trade payables 3,458 2,608 173 548
Other payables 1,872 1,751 1,232 1,262
Other taxes and social security taxes 3,346 1,325 12 80
Accrued expenses 101 68 42 34
8,777 5,752 1,459 1,924
Total $'000 30 days 60 days 90 days 120 days 121 days or more
Trade payables 3,458 652 169 316 153 2,168
Other payables 1,872 679 1,193
Total 5,330 1,331 169 316 153 3,361
19 Provisions
Apr 2023 Apr 2022 Apr 2023 Apr 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Provision for rehabilitation of mining properties
- Provision brought forward from previous periods 1,145 1,206 - -
- Liability recognised during period - - - -
- Effect of foreign exchange 20 (61) -
1,165 1,145 - -
As more fully set out in the Statement of Accounting Policies on page 38, the
Group provides for the cost of the rehabilitation of a mining property on the
cessation of mining. Provision for this cost is recognised from the
commencement of mining activities.
This provision accounts for the estimated full cost to rehabilitate the mines
at Manaila and Baita according to good practice guidelines in the country
where the mine is located, which may involve more than the stipulated minimum
legal commitment.
When accounting for the provision the Group recognises a provision for the
full cost to rehabilitate the mine and a matching asset accounted for within
the non-current mining asset.
20 Trade and other payables
Vast Baita Plai SA (‘VBP’) reached an agreement in principle with ANAF in
December 2021 to defer the current payroll tax liability over a five year
period. The final repayment schedule was established on 20 May 2022. The
amounts included in trade and other payables (non-current liabilities)
represent those amounts that are due for repayment beyond one year from the
balance sheet date.
Apr-23 Apr-22
$000's $000's
Amounts due between one and two years 455 340
Amounts due between two and three years 579 409
Amounts due between three and four years 725 493
Amounts due between four and five years 174 712
1,933 1,954
After the year end, the Company has entered into discussions for a new and
required restructuring plan in order to ensure the Company can affordably
repay the total amounts due to the tax authorities
21 Financial instruments – risk management
Significant accounting policies
Details of the significant accounting policies in respect of financial
instruments are disclosed on page 35. The Group’s financial instruments
comprise available for sale investments, cash and items arising directly from
its operations such as trade and other receivables, trade payables and loans.
Financial risk management
The Board seeks to minimise its exposure to financial risk by reviewing and
agreeing policies for managing each financial risk and monitoring them on a
regular basis. No formal policies have been put in place in order to hedge the
Group and Company’s activities to the exposure to currency risk or interest
risk; however, the Board will consider this periodically. No derivatives or
hedges were entered into during the year.
The Group and Company is exposed through its operations to the following
financial risks:
* Credit risk
* Market risk (includes cash flow interest rate risk and foreign currency
risk)
* Liquidity risk
The policy for each of the above risks is described in more detail below.
The principal financial instruments used by the Group, from which financial
instruments risk arises are as follow:
* Receivables
* Cash and cash equivalents
* Trade and other payables (excluding other taxes and social security) and
loans
* Available for sale investments
The table below sets out the carrying value of all financial instruments by
category.
2023 2022 2023 2022
Group Group Company Company
$’000 $’000 $’000 $’000
Loans and receivables
Cash and cash equivalents 530 103 460 86
Receivables 2,936 2,834 1,024 648
Loans to Group Companies - - 33,920 25,402
Financial assets held for sale
Available for sale investments 891 891 891 891
Other liabilities
Trade and other payables (excl short term loans) 8,777 5,752 1,459 1,924
Loans and borrowings 9,169 10,316 5,605 5,300
The available for sale investment is recognised in the financial statements at
fair value through to profit or loss account and are classified within the
level 1 Category. There were no transfers between fair value hierarchies
during 2022 and 2023.
Credit risk
Financial assets, which potentially subject the Group and the Company to
concentrations of credit risk, consist principally of cash, short-term
deposits, an available for sale investment in 15% loan notes funding the
Blueberry project, and other receivables. Cash balances are all held at
recognised financial institutions. The 15% loan notes are considered fully
recoverable given the project prospects. Receivables are presented net of
allowances for doubtful receivables.
The Company has a credit risk in respect of inter-company loans to
subsidiaries. The recoverability of these balances is dependent on the
commercial viability of the exploration activities undertaken by the
respective subsidiary companies. The credit risk of these loans is managed as
the directors constantly monitor and assess the viability and quality of the
respective subsidiary's investments in intangible mining assets.
Maximum exposure to credit risk
The Group’s maximum exposure to credit risk by category of financial
instrument is shown in the table below:
2023 2023 2022 2022
Carrying value Maximum exposure Carrying value Maximum exposure
$’000 $’000 $’000 $’000
Cash and cash equivalents 530 530 103 103
Receivables 2,936 2,936 2,834 2,834
Available for sale investments 891 891 891 891
The Company’s maximum exposure to credit risk by category of financial
instrument is shown in the table below:
2023 2023 2022 2022
Carrying value Maximum exposure Carrying value Maximum exposure
$’000 $’000 $’000 $’000
Cash and cash equivalents 460 460 86 86
Receivables 1,024 1,024 648 648
Available for sale investments 891 891 891 891
Loans to Group Companies 33,920 33,920 25,402 25,402
Market risk
Cash flow interest rate risk
The Group has adopted a non-speculative policy on managing interest rate risk.
Only approved financial institutions with sound capital bases are used to
borrow funds and for the investments of surplus funds.
At the reporting date, the Group had a cash balance of $0.530 million (2022:
$0.103 million) which was made up as follows:
2023 2022
Group Group
$’000 $’000
Sterling 457 3
United States Dollar 3 41
Euro - 42
Lei (Romania) 70 17
530 103
At the reporting date, the Company had a cash balance of $0.460 million (2022:
$0.086 million) which was made up as follows:
2023 2022
Company Company
$’000 $’000
Sterling 457 4
United States Dollar 3 39
Euro - 42
Lei (Romania) - 1
460 86
The Group had interest bearing debts at the current year end of US$9.151
million (2022: US$10.275 million). These are made up as follows:
Interest rate 2023 Group 2022 Group 2023 Company 2022 Company
$'000 $'000 $'000 $'000
Secured short-term loans 10-20% 8,213 10,075 4,666 5,100
Unsecured loans 6-10% 938 200 939 200
9,151 10,275 5,605 5,300
Borrowings of US$3.547 million carry a floating interest rate with the
remainder having fixed rates. An increase in interest rates of 1% would
increase the annual finance expense by US$34,547. All Company borrowings are
at fixed rates.
Foreign currency risk
Foreign exchange risk is inherent in the Group’s and the Company’s
activities and is accepted as such. The Company’s production, underlying
value, and funding is referenced to and denominated in the United States
Dollar and therefore foreign currency exchange risk arises where any balance
is held, or costs incurred, in currencies other than United States Dollars. At
30 April 2023 and 30 April 2022, the currency exposure of the Group was as
follows:
Currency exposure - Group
Sterling US Dollar Euro Other Total
At 30 April 2023 $’000 $’000 $’000 $’000 $’000
Cash and cash equivalents 457 3 - 70 530
Trade and other receivables 74 1,055 45 1,762 2,936
Trade and other payables (802) (690) (42) (7,243) (8,777)
Available for sale investments - 891 - - 891
At 30 April 2022
Cash and cash equivalents 3 41 42 17 103
Trade and other receivables 30 582 170 2,052 2,834
Trade and other payables (1,004) (585) (330) (3,833) (5,752)
Available for sale investments - 891 - - 891
The effect of a 10% strengthening of Sterling against the US dollar at the
reporting date, all other variables held constant, would have resulted in
increasing post tax losses by $27,100 (2022: $97,000 decrease). Conversely the
effect of a 10% weakening of Sterling against the US dollar at the reporting
date, all other variables held constant, would have resulted in decreasing
post tax losses by $27,100 (2022: $97,000 increase)
At 30 April 2023 and 30 April 2022, the currency exposure of the Company was
as follows:
Currency exposure - Company
Sterling US Dollar Euro Other Total
At 30 April 2023 $’000 $’000 $’000 $’000 $’000
Cash and cash equivalents 457 3 - - 460
Trade and other receivables 73 906 45 - 1,024
Loans to Group companies - 33,920 - - 33,920
Trade and other payables (802) (651) (42) 36 (1,459)
Available for sale investments - 891 - - 891
At 30 April 2022
Cash and cash equivalents 4 39 42 1 86
Trade and other receivables 30 513 105 - 648
Loans to Group companies - 25,402 - - 25,402
Trade and other payables (1,003) (584) (330) (7) (1,924)
Available for sale investments - 891 - - 891
Liquidity risk
Any borrowing facilities are negotiated with approved financial institutions
at acceptable interest rates. All assets and liabilities are at fixed and
floating interest rate. The Group and the Company seeks to manage its
financial risk to ensure that sufficient liquidity is available to meet the
foreseeable needs both in the short and long term. See also references to
Going Concern disclosures in the Strategic Report on page 10.
The Group’s total contractual future cashflows for loans and borrowings are
shown in the table below:
2023 2023 2022 2022
Carrying value Total Contractual Future Cashflows Carrying value Total Contractual Future Cashflows
Loans and borrowings 9,169 9,317 10,316 10,754
The Group’s estimated future interest charges are shown in the table below:
Apr-23 Apr-22
$000's $000's
Estimated future interest charges for the Group within one year. 148 438
The Company’s contractual future cashflows for loans and borrowings are
shown in the table below:
2023 2023 2022 2022
Carrying value Total Contractual Future Cashflows Carrying value Total Contractual Future Cashflows
Loans and borrowings 5,605 5,756 5,300 5,364
The Company’s estimated future interest charges are shown in the table
below:
Apr-23 Apr-22
$000's $000's
Estimated future interest charges for the Company within one year. 134 64
The maturity of the Group’s and Company’s loans and borrowings are shown
below:
Interest rate 2023 Group 2022 Group 2023 Company 2022 Company
$'000 $'000 $'000 $'000
Secured short-term loans 10-20% 8,213 10,075 4,666 5,100
Unsecured loans 0-10% 956 241 939 200
9,169 10,316 5,605 5,300
These loans are repayable as follows:
-Within 1 year 9,169 10,316 5,605 5,300
-Between 1 and 2 years - - - -
-In more than 2 years - - - -
As set out in Note 18 of the consolidated trade and other payables balance of
US$5.330 million, US$1.500 million is due for payment within 60 days of the
reporting date. The maturity profile of interest-bearing debts is highlighted
above. The secured short-term loans are due for repayment on 30 November 2023.
Capital
The objective of the Directors is to maximise shareholder returns and minimise
risks by keeping a reasonable balance between debt and equity.
Debt equity ratio
The Group’s debt to equity ratio is 339.7% (2022: 479.7%), calculated as follows: Apr 2023 Apr 2022
$000’s $'000
Loans and borrowings 9,169 10,316
Less: cash and cash equivalents (530) (103)
Net debt 8,639 10,213
Total equity 2,543 2,129
Debt to capital ratio (%) 339.7% 479.7%
22 Share capital
Ordinary 0.1p Deferred 0.9p TOTAL
No of shares Nominal value No of shares Nominal value Share Capital Share premium
As at 30 April 2021 21,300,489,500 28,242 863,562,664 12,850 41,092 89,348
Capital Reorganization (21,087,484,605) (27,959) 2,343,053,845 27,959 0 0
Issued during the period * 277,342,966 366 - - 366 5,359
As at 30 April 2022 490,347,861 649 3,206,616,509 40,809 41,458 94,707
Issued during the year * 2,437,296,281 2,915 - - 2,915 8,651
As at 30 April 2023 2,927,644,142 3,564 3,206,616,509 40,809 44,373 103,358
* Details of the shares issued during the year are as shown in the table below
and in the Statement of Changes of Equity on pages 30-31 of the annual report.
There were no shares reserved for issue under share options at 30 April 2023
(2022: nil).
On 6 May 2021 the Company concluded a capital reorganisation which comprised
two distinct parts, firstly a consolidation of the existing Ordinary Shares on
a 1 for 100 basis, and then a subdivision of each resulting ordinary share of
10p into one new Ordinary Share and eleven new Deferred Shares. The effect of
this reorganisation was to reduce the number of ordinary shares in issue by a
factor of 100. The effect of this capital reorganisation is highlighted in the
above table.
The deferred shares carry no rights to dividends or to participate in any way
in the income or profits of the Company. They may receive a return of capital
equal to the amount paid up on each deferred share after the ordinary shares
have received a return of capital equal to the amount paid up on each ordinary
share plus £10,000,000 on each ordinary share, but no further right to
participate in the assets of the Company. The Company may, subject to the
Statutes, acquire all or any of the deferred shares at any time for no
consideration. The deferred shares carry no votes.
The ordinary shares carry all the rights normally attributed to ordinary
shares in a company subject to the rights of the deferred shares.
See also Note 28 on page 63 for details of share issues after the reporting
date.
Date of issue
2023 No of shares Issue price (p) Purpose of issue
03-May-22 29,648,978 0.400 Settle debt
06-May-22 89,255,224 0.270 Settle debt
18-May-22 151,260,080 0.270 Settle debt
31-May-22 241,799,020 0.270 Settle debt
15-Jun-22 214,285,715 0.700 Placing with investors
15-Jun-22 249,046,446 0.700 Subscription by investors
29-Sep-22 164,000,000 0.400 Placing with investors
31-Oct-22 652,000,000 0.225 Placing with investors
10-Feb-23 15,000,000 0.550 Subscription by management
10-Feb-23 54,545,454 0.550 Placing with investors
20-Feb-23 363,636,364 0.550 Placing with investors
18-Apr-23 67,000,000 0.460 Placing with investors
26-Apr-23 145,819,000 0.460 Placing with investors
2,437,296,281
Date of issue
2022 No of shares Issue price (p) Purpose of issue
06-May-21 0 0.000 CAPITAL REORGANISATION
13-Aug-21 5,611,110 6.300 Placing with investors
13-Aug-21 3,580,952 6.300 Subscription by investors
24-Aug-21 18,784,760 6.300 Placing with investors
03-Nov-21 10,000,000 2.500 Placing with investors
11-Nov-21 44,000,000 2.500 Placing with investors
30-Nov-21 1,512,416 2.470 To settle liabilities
01-Dec-21 1,540,160 2.430 To settle liabilities
02-Dec-21 1,577,229 2.370 To settle liabilities
11-Jan-22 4,676,536 1.570 To settle liabilities
24-Feb-22 14,806,819 1.240 To settle liabilities
24-Mar-22 13,195,122 0.860 To settle liabilities
30-Mar-22 14,772,333 0.770 To settle liabilities
12-Apr-22 19,400,315 0.590 To settle liabilities
20-Apr-22 50,000,000 0.840 Subscription by investors
21-Apr-22 48,414,060 0.480 To settle liabilities
25-Apr-22 25,471,154 0.450 To settle liabilities
277,342,966
23 Share based payments
Equity – settled share-based payments
The Company has granted share options and warrants to Directors, staff and
consultants.
In June 2015, the Company also established a Share Appreciation Scheme to
incentivise Directors and senior executives. The basis of the Scheme is to
grant a fixed number of 'share appreciation rights' (SARs) to participants.
Each SAR is credited rights to receive at the discretion of the Company
ordinary shares in the Company or cash to a value of the difference in the
value of a share at the date of exercise of rights and the value at date of
grant. The SARS are subject to various performance conditions.
The tables below reconcile the opening and closing number of SARs in issue at
each reporting date:
Exercise price In issue at 30 April 2022 Issued during year* Lapsed during year Exercised during year In issue at 30 April 2023 Final exercise date
Options
1.21p 60,000,000 60,000,000 Dec-25*
1.21p 50,000,000 50,000,000 Dec-25
19.8p 10,000,000 (10,000,000) - Dec-25**
19.8p 700,000 700,000 Nov-23
19.8p 700,000 700,000 Mar-24
25p 520,000 (520,000) - Nov-22
25p 620,000 (620,000) - Mar-23
45p 50,000 (50,000) - Dec-22***
50p 470,000 (470,000) - Mar-23
13,060,000 110,000,000 (11,660,000) - 111,400,000
*60,000,000 SARs exercisable subject to shareholder authority at GM which was received after the year end
**Vests upon one day VWAP share price reaching not less than 20p for a continuous period of 20 consecutive business days where the first of such days falls on or before 31 December 2022
***Extended from 30 June 2020 to 31 December 2022
Exercise price In issue at Issued during year* Lapsed during year Exercised during year In issue at 30 April 2022 Final exercise date
30 April 2021*
Options
19.8p 10,000,000 10,000,000 Dec-25**
19.8p 700,000 700,000 Nov-23
19.8p 700,000 700,000 Mar-24
25p 520,000 520,000 Nov-22
25p 620,000 620,000 Mar-23
30p 200,000 (200,000) - Mar-22
45p 50,000 50,000 Dec-22***
50p 480,000 (480,000) - Mar-22
50p 470,000 470,000 Mar-23
3,740,000 10,000,000 (680,000) - 13,060,000
* Prior years SARS awards have been restated to reflect the share capital reorganisation effected on 5 May 2022
**Vests upon one day VWAP share price reaching not less than 20p for a continuous period of 20 consecutive business days where the first of such days falls on or before 31 December 2022
***Extended from 30 June 2020 to 31 December 2022
The tables below reconcile the opening and closing number of share option and
warrants in issue at each reporting date:
Exercise price In issue at 30 April 2022 Issued during year Lapsed during year Exercised during year In issue at 30 April 2023 Final exercise date
1.44p - 45,167,118 - - 45,167,118 May-23
0.525p 160,000,000 - - - 160,000,000 Dec-25
26p* 5,176,048 - (5,176,048) - - Jan-23
165,176,048 45,167,118 (5,176,048) - 205,167,118
variable 23,150,000 - - - 23,150,000 See Note
188,326,048 45,167,118 (5,176,048) - 228,317,118
Exercise price In issue at 30 April 2021* Issued during year Lapsed during year Exercised during year In issue at 30 April 2022* Final exercise date
0.525p - 160,000,000 - - 160,000,000 Dec-25
26p* 5,176,048 - - - 5,176,048 Jan-23
5,176,048 160,000,000 - - 165,176,048
variable 23,150,000 - - - 23,150,000 See Note
28,326,048 160,000,000 - - 188,326,048
*Prior years warrants issued have been restated to reflect the share capital reorganisation effected on 6 May 2022
* Extended from June 2019
Note: These warrants are only exercisable in the event of a
default in repayment of the Mercuria loan.
2023 2022
Weighted average exercise price (pence) Number Weighted average exercise price (pence) Number
Outstanding at the beginning of the year 2.80 178,236,048 27.77 8,916,048
Granted during the year 1.28 155,167,118 1.66 170,000,000
Lapsed during the year 22.98 (16,836,048) 44.12 (680,000)
Outstanding at the end of the year 0.98 316,567,118 2.80 178,236,048
Exercisable at the end of the year 0.98 256,567,118 2.80 8,236,048
The weighted average remaining lives of the SARs, share options or warrants
outstanding at the end of the period is 28 months (2022: 14 months). Of the
316,567,118 SARs, options and warrants outstanding at 30 April 2023
(2022: 178,236,048), 256,567,118 (2022: 8,236,048) are fully vested in the
holders and are exercisable at that date.
Fair value of share options
The fair values of share options and warrants granted have been calculated
using the Black Scholes pricing model which takes into account factors
specific-to-share incentive plans such as the vesting periods of the plan, the
expected dividend yield of the Company’s shares and the estimated volatility
of those shares. Based on the above assumptions, the fair values of the
options granted are estimated to be:
Grant date Share Option or Warrant Exercise Price Vesting periods Share price at date of grant Volatility Life (years) Dividend yield Risk free interest rate Fair value
Apr-22 0.525 Apr-23 0.525 105% 1 nil 0.69% 0.21
May-22 1.44 May-23 0.012 123% 1.00 nil 0.94% 0.005
Apr-23 1.21 Dec-25 0.615 150% 2.67 nil 4.18% 0.0044
Volatility has been based on historical share price information. A higher rate
of volatility is used when determining the fair value of certain options in
order to reflect the special conditions attached thereto.
Based on the above fair values the expense arising from equity-settled share
options and warrants made was $274,052 (2022: $356,015).
Warrant and Share option expense
Apr 2023 Apr 2022
Group Group
$’000 $’000
Warrant and share option expense:
- In respect of remuneration contracts 274 356
- In respect of financing arrangements - -
Total expense / (credit) 274 356
24 Reserves
Details of the nature and purpose of each reserve within owners’ equity are
provided below:
* Share capital represents the nominal value at 0.1p each of the shares in
issue.
* Share premium represents the balance of consideration received net of
fund-raising costs in excess of the par value of the shares.
* The share options reserve represents the accumulated balance of share
benefit charges recognised in respect of share options granted by the Company,
less transfers to retained losses in respect of options exercised or lapsed.
* The foreign currency translation reserve represents amounts arising on the
translation of the Group and Company financial statements from Sterling to
United States Dollars, as set out in the Statement of Accounting Policies on
page 36, prior to the change in functional currency to United States Dollars,
together with cumulative foreign exchange differences arising from the
translation of the Financial Statements of foreign subsidiaries; this reserve
is not distributable by way of dividends.
* The retained deficit reserve represents the cumulative net gains and losses
recognised in the Group statement of comprehensive income.
25 Related party transactions
Company and group
Directors and key management emoluments are disclosed in notes 6 and 7.
Group
At the reporting date, there was an amount owing by Vast Baita Plai SA
(formerly African Consolidated Resources SRL) to Ozone Homes SRL (Ozone) of
US$3,734 (2022: US$3,586) in respect of transactions undertaken by Ozone in
2014. Ozone is a company controlled by Andrew Prelea, the Group CEO and senior
Group executive in Romania.
During the year, the company had a service contract with Roy Tucker to provide
office premises and associated services totalling US$21,722 excluding VAT
(2022: US$24,360).
During the year, the Company provided services of US$1.064 million to CAMM,
its 24.5% associate company, who provides these services on a back-to-back
basis to Takob, a third party. These amounts have been recognised in revenues.
26 Contingent liabilities
In the normal course of conducting business in Romania, the Company’s
Romanian businesses are subject to a number of legal proceedings and claims.
These matters comprise claims by the Romanian tax authorities. The Company
records liabilities related to such matters when management assesses that
settlement of the exposure is probable and can be reasonably estimated. Based
on current information and legal advice, management does not expect any such
proceedings or claims to result in liabilities and therefore no liabilities
have been recorded at 30 April 2023. However, these matters are subject to
inherent uncertainties and there exists the remote possibility that the
outcome of these proceedings and claims could have a material impact on the
Group.
27 Contingent assets
As mentioned in the Strategic Report, the company has an historic claim in its
operations. No asset has been recorded in respect of the claim.
28 Events after the reporting date
Ordinary Shares issued and warrants exercised post reporting
date
£ $ Shares issued Issued to
3,520,350 4,409,350 1,419,000,000 Placing with investors
3,520,350 4,409,350 1,419,000,000
The Company has executed a Memorandum of Understanding (MoU) which will give
it an interest in, and management responsibility for, the Aprelevka gold mines
in the Tien Shan Belt of Tajikistan.
29 Group subsidiaries
A full list of all subsidiary companies and their registered offices is given
below:
Company Country of registration Group Interest Nature of business
Note 2023 2022 2021 2020
Sinarom Mining Group SRL Romania 2 100% 100% 100% 100% Mining production
Vast Baita Plai SA* Romania 1 100% 100% 100% 80% Mining development
AP Mining Group Ltd UK 3 100% 100% 100% nil Dormant
Vast Resources Enterprises Limited UK 3 100% 100% 100% nil Mining investment
Vast Resources Nominees Limited ** UK 3 100% 100% 100% 100% Nominee company
Vast Resources Romania Limited UK 3 100% 100% 100% 100% Mining investment
Accufin Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Aeromags (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Cadex Investments (Private) Limited Zimbabwe 4 100% 100% 100% 100% Claim holding
Campstar Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Central Asia Investments Ltd United Kingdom 3 49% 49% nil nil Holding company
Chaperon Manufacturing (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Charmed Technical Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Chianty Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Conneire Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Corampian Technical Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Dashaloo Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Deep Burg Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Deft Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Exchequer Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Febrim Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Heavystuff Investment Company (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Hemihelp Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Isiyala Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Katanga Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Kengen Trading (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Kielty Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Lafton Investments (Private) Limited Zimbabwe 4 100% 100% 100% 100% Claim holding
Lomite Investments (Private) Limited Zimbabwe 4 100% 100% 100% 100% Claim holding
Lucciola Investment Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Malaghan Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Methven Investment Company (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Mimic Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Monteiro Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Mystical Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Naxten Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Asset holding
Nedziwe Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Notebridge Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Olebile Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Perkinson Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Pickstone-Peerless Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Possession Investment Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Prudent Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Rania Haulage (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Regsite Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Riberio Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Sackler Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Schont Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Swadini Miners (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Tamahine Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
The Salon Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Vast Resources Zimbabwe (Private) Limited Zimbabwe 5 100% 100% 100% 100% Mining investment
Vono Trading (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Wynton Investment Company (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Zimchew Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Isiyala Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Katanga Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Kengen Trading (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Kielty Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Lafton Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Lomite Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Lucciola Investment Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Malaghan Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Methven Investment Company (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Mimic Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Monteiro Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Mystical Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Naxten Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Asset holding
Nedziwe Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Notebridge Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Olebile Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Perkinson Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Pickstone-Peerless Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Possession Investment Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Prudent Mining (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Rania Haulage (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Regsite Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Riberio Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Sackler Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Schont Mining Services (Private) Limited Zimbabwe 5 100% 100% 100% 100% Claim holding
Swadini Miners (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Tamahine Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
The Salon Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Vast Resources Zimbabwe (Private) Limited Zimbabwe 5 100% 100% 100% 100% Mining investment
Vono Trading (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Wynton Investment Company (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
Zimchew Investments (Private) Limited Zimbabwe 5 100% 100% 100% 100% Dormant
* Formerly African Consolidated Resources SRL
**Formerly ACR Nominees Ltd
Notes - Addresses of Registered offices:
1 Sat Iacobeni,Str.Minelor Nr.20, Jud. Suceava, Romania
2 Str.9 Mai, Nr.20, Baia Mare, Jud.Maramures, 430274 Romania
3 Nettlestead Place, Nettlestead, Maidstone, Kent ME18 6HE,
United Kingdom
4 121 Borrowdale Road, Gun Hill, Harare, Zimbabwe
5 6, John Plagis Avenue, Alexandra Park, Harare, Zimbabwe
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