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26 July 2024
Great Southern Copper
plc
("GSC" or the
"Company")
Full Year Results and
Publication of Annual Report
Great Southern Copper plc (LSE:
GSCU), the Company focused on copper-gold and lithium exploration
in Chile, announces its results for the year ended 31 March
2024.
HIGHLIGHTS
Especularita Project
· Exploration activities have identified a strong pipeline of
high priority drill targets.
· Results from mapping and sampling activity at the Victoria
prospect, showing assay grades in rock chips of up to 6.9% Cu and
1.85g/t Au.
· Results from mapping at sampling activity at Teresita
prospect, showing assay grades in rock chips of up to
5.97% Cu and 13.9g/t Au.
· Completed stream sediment sampling survey, setting stage for
follow-up mapping and sampling campaign to identify new
prospects.
· Results from drone-magnetic survey, demonstrating high-grade
Abundante and Teresita Cu-Au prospects as magnetic
anomalies.
Especularita post period
· On 9
April 2024, scout drilling at Teresita and Abundante confirmed
intrusive-related and breccia-hosted mineralisation systems with
all drill holes intersecting anomalous gold and copper
mineralisation.
· Expanded footprint in highly prospective region:
o On 12 June 2024, signed agreement for Artemisa prospect
adding 1,665 ha to Especularita and began permitting process for
drilling.
o On 8 July 2024, signed agreement for Cerro Negro prospect,
including historical Mostaza Mine, which has indicated presence
high-grade Cu-Ag-Au mineralisation, and commenced the permitting
process for drilling.
San Lorenzo
· Received pleasing results from reconnaissance sampling at
newly acquired Suyay prospect, indicating potential porphyry-type
mineralisation.
Monte Lithium
· Delivered strategic objective to acquire a third project, the
Monti Lithium Project - 33,100 ha in the Salar de Atacama, Chile's
largest lithium brine producing district.
Corporate
· Appointed Martin Page as Chief Financial Officer and member
of the Board.
· Raised £1m and £905,000 through well-supported placing and
subscription agreements.
Corporate post-period
· On
26 June 2024, raised £1.25m through a conditional placing and
subscription to fund drilling and exploration work at
Especularita.
Sam Garrett, Chief Executive
Officer of Great Southern Copper, said: "It
has been another strong year for GSC. We made good progress across
our project portfolio with excellent results from our exploration
campaigns, establishing a very strong pipeline of drill
targets.
"Our Especularita copper-gold
project remains our primary focus. The impressive assay results and
magnetic surveys have bolstered our confidence in the project's
potential and we are excited by to push forwards our follow-up
exploration activities. Our recent acquisitions of Artemisa and
Cerro Negro further expand our footprint at Especularita,
strategically positioning us to unlock value from these highly
prospective areas with significant potential.
"The next six to twelve months
promise to be an exciting period for the Company with plans in
place to drill our priority targets. Our strengthened financial
position enables us to accelerate our exploration activities,
ensuring that we maximise the value of our asset base."
Annual Report and
Accounts
The Company will shortly be
publishing its Annual Report and Accounts. It will be made
available on the Company's website at https://gscplc.com and
posted to shareholders.
Enquiries:
Great Southern Copper plc
|
|
Sam Garrett, Chief Executive
Officer
|
+44 (0) 20 4582 3500
|
|
|
SI Capital Limited
|
|
Nick Emerson
|
+44 (0) 1483 413500
|
|
|
Gracechurch Group
|
|
Harry Chathli, Alexis Gore, Henry
Gamble
|
+44 (0) 20 4582 3500
|
About Great Southern Copper
Great Southern Copper PLC is a
UK-listed mineral exploration company focused on the discovery of
copper-gold and lithium deposits in Chile. The Company has the
option to acquire rights to 100% of two projects in the
under-explored coastal belt of Chile that are prospective for large
scale copper-gold deposits. In addition, the Company has the option
to acquire rights to 100% of a lithium project located in the Salar
de Atacama district of Chile. Chile is a globally significant
mining jurisdiction being the world's largest copper producer and
the second-largest producer of lithium.
The two, early-stage Cu-Au
projects comprise the Especularita and San Lorenzo Projects, both
located in the coastal metallogenic belt of Chile which hosts
significant copper mines and deposits, including Teck's Carmen de
Andacollo copper mine, and boasts excellent access to
infrastructure such as roads, power and ports. Significant
historical small-scale and artisanal workings for both copper and
gold are readily evident in both exploration project
areas.
The Company's Monti Lithium
project is strategically located in the pre-Andean region of Salar
de Atacama which is Chile's premier lithium-producing region with
well-established lithium mining operations and
infrastructure.
Great Southern Copper is
strategically positioned to support the global market for copper
and lithium - both critical battery metals in the clean energy
transition around the world. The Company is actively engaged in
exploration and evaluation work programmes targeting both large
tonnage, low to medium grade Cu-Au and Li deposits as well as
high-grade Cu-Au deposits.
Further information on the Company
is available on the Company's
website: https://gscplc.com
Chairman's Statement
It has been an important year of
progress for Great Southern Copper plc that has laid the
foundations for an exciting period of upcoming exploration. Over
the year, the Company was successful in both advancing its existing
prospects and identifying additional prospects to diversify our
portfolio. The past 12 months have seen us maintain momentum,
achieving several important milestones across the business in line
with our strategy.
Exploration projects
We remain excited by our portfolio
of prospects in Chile, which includes large-scale projects and
multiple high-grade copper-gold ("Cu-Au") targets ready to drill.
During the period, GSC saw particularly encouraging developments at
our Especularita project, where we received strong results from
mapping and sampling activity across various prospects. Post
period, in April 2024, our confidence was further strengthened by
the results from our scout RC drilling programmes at the Abundante
and Teresita prospects, all of which delivered evidence of high
grades of Cu-Au.
In June 2024, we were pleased to
expand our footprint at Especularita by adding the Artemisa and
Cerro Negro group of concessions. These acquisitions consist of
1,748 additional hectares, encompassing five highly prospective
areas within the project. Subsequent to the year end GSC
dropped a number of non-core concessions at both Especularita and
San Lorenzo, showing strong discipline over its areas of
interest.
In addition, we delivered our
strategic objective to acquire a third project and diversify our
portfolio through the acquisition of the Monti Lithium Project. The
Monti Lithium Project concession applications surround the Salar de
Atacama in northern Chile, a premier lithium brine production
region. Chile, already the largest producer and exporter of copper
globally, also holds the world's largest reserves of lithium and is
the second-largest producer after Australia. The government's
National Lithium Strategy, initiated in 2023, aims to promote the
development of lithium production, making it an ideal location for
exploration.
Chile's long history of mining and
metal processing have provided the country with a highly educated
and experience workforce, supported by first-class infrastructure
and a robust legal framework which is highly receptive to foreign
ownership of mining assets. The Board believes these
characteristics provide GSC with an advantage in an underexplored
area, given historical evidence, excellent infrastructure, and the
rights to earn 100% of the projects with no overhanging
payments.
As both copper and lithium are
essential for powering the global drive towards net zero, we
believe GSC is well-positioned to support the critical metals
market, which is forecasted to experience growing pressure on
supply. Global demand for copper is rising, and the growth of the
electric vehicle market will further increase pressure on lithium
supply.
Corporate
We were delighted to welcome
Martin Page as Chief Financial Officer ("CFO") and as a member of
the Board. Martin brings with him more than 15 years of experience
in finance within the mineral resources sector and has been an
excellent addition to the team since taking the role in August
2023.
Despite the continuing headwinds
in the capital markets we were able to secure three fundraisings
for the Company which raised a total of c. £3.15m (including
amounts raised in June 2024). Firstly, in May 2023 we secured a
total of £1.0m through a combination of a placing and subscription
and a convertible loan facility, and in November 2023, we raised
another £905,000 through a well-supported placing and subscription.
Most recently in June 2024, we were successful in securing an
additional £1.25m in funding supported by existing, institutional
and new investors, a testament to the strength of our project
portfolio, our strategy, and reputation within the investor
community. The funds will enable us to accelerate our exploration
efforts with our strong pipeline of targets.
Looking ahead
Our commitment remains to deliver
value to our shareholders through strategic exploration,
disciplined capital allocation, and a focus on high-quality,
high-potential projects.
We are exploring in a tier one
region, with excellent infrastructure, for resources where there is
high demand and increasing pressure on supply. Our portfolio
includes large-scale, promising prospects with significant
potential and numerous drill-ready targets. As a result, the Board
is looking forward to continuing our progress over the next twelve
months and updating shareholders as we advance our exploration
campaigns.
Finally, I would like to thank our
highly knowledgeable and dedicated team, including the Board, our
management and our team on the ground in Chile for their passion
and devotion towards advancing the Company's exploration efforts
whilst ensuring the values, beliefs and standards of the Company
are upheld and promoted.
Charles Bond
25 July 2024
Operations Report
The Company has three projects all
located in Chile, Especularita, San Lorenzo and Monti Lithium. Of
these, the primary focus is its Especularita project which is
highly prospective for porphyry Cu-Au, intrusive related Cu-Au and
high-grade IOCG Skarn-type mineralisation.
The Company's Especularita and San
Lorenzo projects are strategically located within the coastal
metallogenic belt, offering significant infrastructure advantages
over explorers operating in the high-altitude Andean belt including
access to roads, power, towns, and ports, which facilitate more
efficient and cost-effective operations. Geologically, the coastal
metallogenic belt also offers the company deposit style optionality
being known for large IOCG deposits as well as porphyry copper
deposits.
Both projects are along trend from
major deposits and exhibit substantial evidence of historical
artisanal mining, yet the areas remain relatively underexplored
compared to the Andean regions. This under-exploration presents an
opportunity for significant discoveries in a region with proven
mineral potential.
We have also acquired the Monti
Lithium project in Chile during the period, which is a lithium
brine project located in the highly prospective Salar de Atacama in
Chile1.
Exploration activities at the
projects for the year to 31 March 2024 and subsequent to the year
end are set out below.
Especularita Project
At Especularita, we have seen some
particularly exciting developments as we advanced our exploration
campaign through the year. We received strong results from mapping
and sampling activity at various prospect locations across the
project. Assay results from our rock chip sampling at Victoria,
returned grades up to 6.9% Cu and 1.85g/t Au, highlighting the
significance of the Victoria prospect with consistent high grades
of copper and associated gold-silver mapped and sampled in the
outcrop2.
The results of our drone-magnetics
survey at Especularita were also highly encouraging, which
identified high grade Cu-Au prospects, Abundante and Teresita, as
magnetic anomalies, prompting plans to drill at these
sites.3 It also identified multiple NE-trending targets
within the Teresita magnetic anomaly corridor and bullseye
anomalies that potentially represent breccia-pipe or
pencil-porphyry type Cu deposits.
Building on these findings, we
completed our scout drilling programme at the Abundante and
Teresita prospects4. At Teresita, broad intervals of
anomalous Cu-Au results from scout RC drill-testing of the Gato
Negro vein validated our IRGS target models and we are now
aggressively advancing our follow-up exploration activities.
Significantly, the Teresita drill results also confirm the IRGS
nature of mineralisation at the Company's Victoria
prospect.
Our initial exploration programme
at the Aurelia prospect delivered another high-grade copper target
into the drilling prospect pipeline, with assay grades up to 6.76%
Cu5. This success gave us the impetus for follow-up
exploration, including soil sampling and petrochemical surveys,
setting the stage for initial scout drilling at the
prospect.
We also announced results from our
latest mapping and sampling programme at our Victoria prospect,
which reported grades up to 4.04% Cu, 4.57g/t
Au and 26.7g/t Ag6. These results continue to
highlight the significance of the Victoria prospect with consistent
high grades of copper and associated gold-silver mapped and sampled
in outcrop. Work is now continuing at Victoria with a view to
better understanding the controls on mineralisation and advancing
the prospect toward being ready for drill testing.
In February 2024, we announced our
intention to expand the Company's footprint at Especularita by
signing binding letters of intent for two new high-priority
prospects, Artemisa and Cerro Negro7, and in June and
July 2024 respectively, we completed those agreements adding a
total of 1,748 ha of new concessions, including drill-ready
targets.
The Artemisa group of concessions
comprise five new prospect areas and significantly expands the
Company's Victoria and Lipa exploration targets. The Cerro Negro
option includes the historic Mostaza Cu-Ag-Au Mine which was
previously owned by Antofagasta Minerals. Due diligence work by GSC
indicates that mining in the past did not exhaust the Mostaza
mineral inventory and as such potential exists to expand the known
deposit in all directions as well as discover new deposits along
trend.
San Lorenzo
San Lorenzo comprises both mining
and exploration concessions covering 25,680 ha. The project area
includes extensive historical mine workings for high-grade Cu-Au as
well as evidence of placer gold workings in two
locations.
During the period, the
Company received the results of reconnaissance sampling at the
newly acquired Suyay prospect with results up to 4.13g/t Au and
1.75% Cu8. The anomalous geochemistry combined with
our early understanding of the geology and controls on
mineralisation now suggests that there is potential at Suyay for a
high-level gold-rich porphyry or intrusive-related system. The
Company has identified a number of large radiometric anomalies
potentially representative of porphyry-type silica-clay-sericite
alteration which it intends to target with regional mapping and
sampling programmes.
Monti Lithium
GSC made its first foray into
lithium exploration with the acquisition of an option over the
Monti Lithium Project located in the Salar de Atacama region of
Chile.
The Group secured rights to 100%
ownership of the Monti Lithium Project comprising concession
applications surrounding the Salar de Atacama, Chile's premier
lithium producing region. The Salar de Atacama is a tier 1 lithium
production region with estimated pre-mine resources greater than
6.0 Mt LiCO3. Lithium is hosted in subterranean brine solutions
which are pumped to the surface, where the lithium is extracted via
evaporation processes producing a lithium carbonate (LiCO3)
concentrate product.
The Monti Project initially
comprised 81 concession applications for a total combined
concession area of 235 km2 (23,500 ha).
In October 2023, the total
concession application area of the Monti Lithium project was
expanded to 331 km2 (33,100 ha), strategically targeting
areas where the Company believes the fluid-flow of Li-rich brines
into the Salar de Atacama basin is enhanced by large-scale
structures9.
GSC is now conducting due
diligence on the project with a view to ranking the concession
areas on the basis of potential access to brine-rich horizons in
the basin in-flow regions. Work will include reconnaissance
field trips to undertake surface sampling and mapping
programmes.
Outlook
It has been a positive year of
progress as we continue to make significant strides across our
prospects, particularly at Especularita. Our exploration campaigns
have yielded encouraging results and we have established a very
strong pipeline of drill targets. Whilst acknowledging that GSC
will need to continue to raise funds for its activities, with a
strengthened capital base, we are poised to accelerate our
exploration efforts, where we aim to commence drilling shortly at
our highly prospective targets.
Our Especularita project remains
our primary focus, given its highly promising potential for
porphyry Cu-Au, intrusive-related Cu-Au, and high-grade IOCG
Skarn-type mineralisation. The impressive assay results and
magnetic surveys have reinforced our confidence in the project's
potential, and we are advancing with aggressive follow-up
exploration activities. The expansion of our footprint at
Especularita, including the recent acquisition of Artemisa and
Cerro Negro, strategically positions us to unlock significant value
from these highly prospective areas. In addition, the team has
shown strong discipline in dropping certain non-core concessions
subsequent to the year end.
Looking ahead, our strategic
priorities are clear and the next six to twelve months promise to
be an exciting period for the Company with our plans to drill our
priority targets, namely Cerro Negro, Victoria and Aurelia. All
drilling activities are subject to permitting approvals, rig
availability and community consultations. We will continue to
prioritise and advance our high-potential targets with a focused
and disciplined approach aimed at advancing prospects to
drill-ready status. Our strengthened financial position enables us
to commence our exploration drilling plans at Cerro Negro, ensuring
that we maximise the value of our asset base.
Sam Garrett
Chief Executive Officer
25 July 2024
References:
1. RNS 9894M (20 Sep
2023): GSC Secures "Monti Lithium Project" in the Prolific Salar de
Atacama Region, Chile
2. RNS 0032C (05 Feb
2024): Rock Chip Sampling at Victoria Prospect Delivers Assay
Results up to 4.04% Cu, 4.16g/t Au and 26.7g/t Ag from Multiple
Quartz-Sulphide Vein Breccias
3. RNS 4849P (10 Oct
2023): Especularita Magnetics Survey Identifies Multiple
Targets
4. RNS 5914A (23 Jan
2024): Scout Drilling Completed at Abundante Prospect,
Especularita,
5. RNS 4473Q (18 Oct
2023): High Grade Rock Chips up to 6.76% Cu at Aurelia Prospect,
Especularita
6.
RNS 0032C (05 Feb 2024): Rock Chip Sampling at Victoria Prospect
Delivers Assay Results up to 4.04% Cu, 4.16g/t Au and 26.7g/t Ag
from Multiple Quartz-Sulphide Vein Breccias,
7. RNS 0741E (22 Feb
2024): GSC Expands Especularita Project with Two New
Agreements
8. RNS 4266J (16 Aug
2023): New "Suyay" Prospect Delivers High-Grade Gold-Copper in Rock
Chip Samples, San Lorenzo
9. RNS 7843R (31 Oct
2023): Monti Lithium Project Grows by 40% with New Concession
Filing
Extract from Strategic Report
The Directors present their
Strategic Report on the Group and Company for the year ended 31
March 2024.
Strategy and Business Review
The Company's strategy is to
create value for shareholders by using the expertise of its
management team to successfully explore for copper-gold (Cu-Au)
deposits in Chile and, potentially, to identify and acquire other
mineral exploration projects.
The Company's key exploration
projects in Chile comprise the Especularita Cu-Au project located
approximately 350km north of Santiago and the San Lorenzo Cu-Au
project north east of the coastal town of La Serena in northern
Chile. Both projects are situated in the Coastal Cordillera of
Chile with good access to infrastructure. In addition, the
Company has an option over the Monti Lithium project located in the
Salar de Atacama district of northern Chile.
Subsequent Events
On 26 June 2024, the Company
completed a fund-raising through the placing and subscription for
104,416,667 new ordinary shares of 1p each at £0.012 per share
raising £1.25m before expenses.
On 12 June 2024, the Company
signed a binding purchase option agreement to acquire the Artemisa
copper project at the Company's Especularita project in
Chile.
On 29 June 2024, the Company
signed a binding purchase option agreement to acquire the Cerro
Negro copper project at the Company's Especularita project in
Chile.
Principal Risks
The Directors have identified the
following principal risks in regards to the Company's future. The
relative importance of these risks is likely to evolve over time as
the Company executes its strategy in Chile and as the external
economic and market environment changes.
Strategic Risk
The Company's strategy may not
deliver the results anticipated by the shareholders. The Directors
regularly monitor the Company's progress and will modify the
strategy as required, based on internal and external developments
and exploration results. The strategy is monitored at the Company's
regular Board meetings.
Concentration Risk
The Company's activities are
currently geographically concentrated in Chile. As a result
of this concentration, the Company may be disproportionately
exposed to the impact of local delays or interruptions to
development of, and future production from, these locations caused
by significant changes to governmental regulation, interruption to
transportation together with capacity constraints, curtailment of
future production, natural disasters, adverse weather conditions,
civil unrest, labour disputes or other events which impact this
area.
Exploration Risk
The Company's projects are
regarded as 'early-stage exploration', are highly speculative in
nature, and may not result in success. There is no guarantee that
further mineralisation or recoverable economic resources will be
found.
Whilst the Directors endeavour to
apply their skills to assess the projects, exploration is costly,
highly speculative and often unsuccessful. For instance, factors
such as adverse weather conditions, natural disasters, equipment or
services shortages, procurement delays or difficulties arising from
the environmental and other conditions in the areas where the
potential resources are located, may increase costs and make it
uneconomical to advance or develop the Company's projects.
Failure to discover new mineral resources or maintain existing
mineral rights could materially and adversely affect the Company's
results of operations, cash flows, financial conditions and
prospects.
Government Regulation
The licences and operations of the
Company are in jurisdictions outside of the UK and there will,
therefore, be a number of risks that the Company will be unable to
control.
Whilst the Company will make every
effort to ensure that it has robust commercial agreements in place,
there is a risk that the Company may be adversely affected by
political factors such as taxes and charges, suspension of licences
and changes to the laws governing mineral exploration and
extraction activities. The adoption of a mining royalty tax in
Chile may adversely affect the Company's operations in the
future.
On 10 August 2023, a mining
royalty law was enacted which introduces a new royalty system
payable by copper mining companies. The law contains a variable
royalty rate, dependent on the quantity of copper sold and will
apply to companies producing more than 50,000 metric tonnes of fine
copper per annum. The Company is aware of the law and will continue
to monitor relevant regulations and any other proposed changes and
specifically the impact they could have on any potential future
operations of the Company.
Permitting
The Company's rights to the
exploration projects are defined by option agreements that its
subsidiary, PTRC, has over the exploration and exploitation
concessions at these projects. The option agreements and all of the
concessions are in good standing.
Exploration concessions in Chile
currently last for 2 years, counted since their constitution by
judicial ruling, and are subject to the payment of annual fees to
the Chilean Treasury. If these fees are not paid in a timely
manner, the claim can only be restored to good standing by paying
double the annual fee the following year. At the end of the
two-year period, the exploration concession may i) be renewed for
an additional two years, in which case at least 50% of the surface
area of the exploration concession must be relinquished, or ii) be
converted, totally or partially, into an exploitation concession.
Pursuant to article 112 of the Mining Code, amended by Law No.
21,420 of 4 February 2022 which became effective on 1 January 2024,
exploration concessions will have a duration of 4 years counted
since their constitution (and the 4-year period cannot be
extended).
Exploitation concessions are valid
indefinitely so long as annual fees are paid to the Chilean
government. Pursuant to article 142 bis of the Mining Code, added
by Law No. 21,420 of February 4, 2022 which became effective on 1
January 2024, the annual fee for proving the start and maintenance
of mining works will be US$8/ha. In the event that the exploitation
concessions do not comply with such requirement (maintenance of
mining works), a progressive annual fee will be applied for the
aforementioned measure, as follows:(i) USD32/ha for the first 5
years of validity; (ii) USD64/ha from year 6 to year 10; (iii)
USD72/ha from year 11 to year 15; (iv) USD96/ha from year 16 to
year 20; (v) USD240/ha from year 21 to year 25; (vi) USD580/ha from
year 26 to year 30; and (vi) USD960/ha from year 31. Pursuant to
article 142 bis of the Mining Code, added by Law No. 21,420 of
February 4, 2022 which became effective on 1 January 2024, the
annual fee for proving the start and maintenance of mining works
will be US$8/ha.
The process to incorporate an
exploitation concession is based on the principle that grants
preference to the first petitioner before the local court. The
holder of an exploration concession in good standing has the
preferential right to incorporate an exploitation concession within
the boundaries of its exploration concession. Notwithstanding,
anyone can request the incorporation of an exploitation concession
within the limits of the exploration concession of a different
owner, in which case the holder has to file a claim opposing the
aforementioned constitution, within 30 days, counted from the date
of publication of the application made by the interested third
party. Exploration and exploitation concessions do not necessarily
imply a right to mine, except on a small scale. However, they give
the owner the right to mine subject to the granting of
permits.
There is no guarantee that any of
PTRC's granted exploration concessions, or any exploration
concessions granted in the future, will be renewed. Additionally,
there is no guarantee that PTRC's exploitation concessions granted
or to be granted can be effectively maintained by payment of the
appropriate annual licence fees or by means of compliance with any
new regulation that may control the granting and maintenance of
exploitation concessions in the future. If these exploration and
exploitation concessions are not renewed or maintained, or if new
exploration and exploitation concessions are applied for and not
granted, this could have a material adverse effect on the Company's
business, prospects, financial conditions and results of
operations.
Whilst the Company is satisfied
that it has taken reasonable measures to ensure an unencumbered
right to explore its projects in Chile, the relevant concessions
may be subject to undetected defects. If a defect does exist, it is
possible that the PTRC may lose all or part of its interest in one
or more of the concessions to which the defect relates and its
exploration and exploitation rights over the areas related to such
concessions and prospects of commercial production may accordingly
be adversely affected.
Exploration concessions, which
PTRC has the right to acquire through option agreements, need to be
duly registered in the Chilean Mining Registrar in order for them
to be enforceable. Whilst PTRC is satisfied that it has submitted
all option agreements not currently registered in the Chilean
Mining Registrar for registration, if PTRC fails to register any
option agreement in the Chilean Mining Registrar, then it may be
unable to enforce the benefit of them and PTRC's title to the
exploration concession and could be subject to potential litigation
by third parties claiming an interest in them.
Environmental and Other Regulatory
Requirements
Currently the Group's environment
impact is limited to the activities associated with exploration and
is therefore minimal. The development of any project into a mining
operation will have a considerable impact on the local landscape
and communities. There may at some point be opposition to mining by
some parties and this may impact the ability of the Company to
progress these projects towards production.
Although the Company believes that
its projects are currently in compliance with all relevant
environmental and health and safety laws and regulations, there can
be no guarantee that new laws or regulations, or amendments to
current laws or regulations will not be introduced and they may
have a material impact on the Company and its projects. The Company
will continue to maintain the highest standards and aim to comply
with all appropriate laws and regulations. The Company will also
continue to engage with local communities and non-governmental and
governmental bodies to ensure any impacts of current and future
activities are minimised and managed appropriately.
Financing
The Company is in the exploration
stage of its development and will only become revenue producing
once successful exploration has been achieved and an operating mine
developed. Consequently, the Company will be dependent on
either equity funding or bringing in partners to finance its
operations. The Company may not be successful in the
procurement of the required funds and may therefore have to adjust
its exploration strategy accordingly.
Commodity Prices
The market prices of copper and
gold, like many commodities, are volatile and are affected by
numerous factors which are beyond the Company's control.
Sustained downward movements in copper and gold prices could render
less economic, or uneconomic, the mineral projects that the Company
is exploring and could negatively impact the availability of equity
finance to the Company for it to continue to fund its exploration
activities.
Foreign Currency and Exchange Rates
The Company may be exposed to
ongoing currency risk, however no forex sensitivities have been
included as they are deemed to be immaterial. Proceeds of
fundraises are expected to be mostly in Sterling; the Company's
financial statements are stated in Sterling and certain ongoing
management costs will be denominated in Sterling. Its operational
costs are largely in Chilean Peso (CLP). As a result, fluctuations
in the exchange rates of these currencies may adversely affect the
Company's exploration budgets, operating results, cash flows or
financial condition to a material extent.
Market Conditions
The Company cannot predict the
extent of periods of slow or negative economic growth and any
resultant weakening of consumer and business confidence. This might
result in difficulties in raising capital and lower the level of
demand for many products across a wide variety of industries,
including those industries for which commodities in the natural
resources sector are an important raw material. Accordingly, the
Company's estimate of the results of operations, financial
condition and prospects of the Company, and of any future
acquisition targets, will be uncertain and may be adversely
impacted by unfavourable general global, regional and national
macroeconomic conditions.
Dependence on Key Personnel
The Company's success depends to a
significant extent on the quality of its management. The Company's
business may be disrupted, additional cost may be incurred or its
future may be jeopardised by a loss of, or failure to retain,
sufficient numbers and quality of management staff or senior
personnel.
To mitigate this risk, measures
are in place and are under review to reward and retain key
individuals and to protect the Company from the impact of staff
turnover.
Social, Community and Human Rights
It is the Company's intention to
operate for the benefit of all stakeholders. In this regard,
it will ensure that PTRC:
· Adopts fair, non-discriminatory employment
practices;
· Ensures safe working practices for all employees;
· Positively engages with local communities and is sensitive to
any concerns that they may have regarding land usage, water
resources, biodiversity, cultural sites and artefacts;
and
· Will
treat local suppliers fairly.
Whilst the projects are still at
an early stage of exploration, the Company recognises that for any
mine to be developed at the project sites, it must be able to
demonstrate to all stakeholders, a clear positive benefit that
respects social, community and human rights.
Key Performance Indicators (KPIs)
Given that the Company is at an
early stage in its development, has no turnover and is dependent on
raising funds in the equity market to finance its activities, many
of the quantifiable KPIs that companies in other industries may
present are not applicable here. Nevertheless, management is
monitoring key performance indicators or the process associated
with:
· Company expenses and the cash balance to ensure that the
Company can meet its expected obligations as they fall due and to
inform the required timing of the next fund raising;
· The
progress of the exploration programme and the status and
commitments with regards to the exploration concessions;
and
· Ensuring that Pacific Trends Resources Chile Spa ("PTRC")
meets its environmental and social obligations in Chile.
· Ensuring that the Group maintains as low an impact on climate
change as possible
The Directors are of the opinion
that, for an early-stage mineral exploration company, the audited
accounts, the Chairman's Statement and the Operations Report are
the best means of assessing the performance of the Company during
the year.
Section 172(1) Statement
The Directors believe they have
acted in the way that they consider, in good faith, would be most
likely to promote the success of the Company for the benefit of its
members as a whole (as required by s172 of the Companies Act 2006),
and in doing so have had regard (amongst other matters) to the
following factors:
· The
likely consequences of any decision in the long term;
· The
interests of the Company's employees;
· The
need to foster the Company's business relationships with suppliers,
customers and others;
· The
impact of the Company's operations on the community and the
environment;
· The
desirability of the Company maintaining a reputation for high
standards of business conduct; and
· The
need to act fairly as between members of the Company.
The application of the s172
requirements can be demonstrated by the actions and key decisions
of the Company during the year including:
· In
pursuit of the Company's strategy of creating value for
shareholders via the exploration for copper mineral deposits in
Chile, the Company has, in the past year:
· carried out exploration and identified copper mineralisation
at its two projects in Chile;
· confirmed the discovery of a large intrusive-related
copper-gold mineralised system at Especularita;
· identified mineralised vein breccia targets for follow up
work; and
· added a third project to the Company - being the Monti
lithium project
· In
order to pursue the strategy outlined, the Directors are aware of
the importance of developing the skills of its employees and
establishing a good team work ethic where team members work well
together and communicate openly with each other. In pursuit
of this objective, the CEO visited the projects in Chile on a
number of occasions during the year, working with team members and,
together with the Company's experienced exploration manager,
imparting the benefit of their expertise to more junior team
members.
· In
the past year, the Company has acted fairly, in good faith and
without problems with all of the service providers.
· At
this stage of the Company's development, it has no
customers.
· The
Directors are very aware of the need to carefully manage
environmental and social matters in Chile in order to ensure that
it has a social licence to explore and, if successful, to
ultimately mine at the project sites. The Company has
prepared a 'Sustainability' statement which appears on the
Company's website and has commenced work on an Environmental,
Social and Corporate Governance ("ESG") policy to govern how
members of the team manage these matters and to ensure that the
Company operates to the highest standards.
· The
Company's values of business conduct are described in the Corporate
Governance Statement. Additionally, the culture of the
Company is illustrated by the following statements that appear on
the Company's website:
· We
will be guided by our company values to act with integrity at all
times both within the workplace and within the community more
broadly; and
· We
will communicate transparently and honestly with all
stakeholders
· Retaining investor support is important to the Company and,
therefore, the Directors intend to keep shareholders fully and
equally informed. In the past year, the Company has kept
shareholders informed of progress via news releases, web podcasts,
the Company's website, attending a mining conference and through
direct contact. Moving forward, management will continue to
attend mining conferences where they will be available to meet
shareholders in person.
Extract from the Directors' report
The Directors have pleasure in
submitting their report together with the audited financial
statements for Great Southern Copper plc (the 'Company' and
together with its subsidiary, the 'Group') for the year ended 31
March 2024.
Principal Activities
The Group is currently focussed
upon the exploration for copper and gold in Chile. Further detail
is covered in the Chairman's Statement and also in the Operations
Report.
Dividends
No dividends are planned (2023:
£nil).
Subsequent Events
Further details on subsequent
events can be found in note 24 and in the strategic report on page
19 of the Annual Report.
Going Concern
In common with many other mineral
exploration companies, the Group has raised equity and debt finance
for its exploration activities. The Board recognises that further
finance will need to be raised as and when required to progress its
exploration projects and add shareholder value. The Board also
acknowledges that previous success in raising funds does not
necessarily provide any guarantee that the Group will be able to do
so in the future.
As at 31 March 2024, the Group's
cash at bank amounted to £503k; at the date of signing this report,
the balance of cash and committed funds amounted to
£1,005k.
The Board has reviewed the Group's
cash flow forecast up to 31 July 2025 and are aware that additional
funds will need to be sourced in order to continue to advance its
exploration activities and continue as a going concern for a period
of at least 12 months from the approval of these financial
statements. The Directors are confident that they will be
able to secure the necessary funding in order to enable the Group
to continue to advance its projects, however the requirement for
further uncommitted fundings casts significant doubt over the
Group's ability to continue as a going concern. The auditors
have acknowledged this going concern uncertainty in their
unqualified audit report.
The Board continues to closely
monitor its cash position, allocate funds in line with its detailed
budget and maintain a strict control over non-project spend.
The Directors remain confident in the Company's ability to raise
additional funds as required, from existing and/or new investors
and therefore consider it appropriate to continue to adopt the
going concern basis of accounting in preparing these financial
statements.
Extracted from Directors' responsibility statement pursuant
to Disclosure and Transparency Rules
Each of the Directors, whose names
and functions are listed on page 7 and 8 of the Annual Report,
confirms that to the best of his knowledge and belief:
· The
financial statements prepared in accordance with UK-adopted
International Accounting Standards and in conformity with the
Companies Act 2006, give a true and fair view of the assets,
liabilities, financial position and loss of the Group and parent
company; and
· The
Annual Report and financial statements, including the Operations
Report, includes a fair review of the development and performance
of the business and the position of the Group and parent company,
together with a description of the principal risks and
uncertainties that they face.
Approved by the Board of Directors
and signed on behalf of the Board by:
Charles Bond
Chairman
25 July 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
YEAR ENDED 31 MARCH 2024
|
Note
|
Year ended
31 March
2024
£'000
|
Year ended
31 March
2023
£'000
|
Continuing operations
|
|
|
|
Administrative expenses
|
6
|
(1,759)
|
(1,299)
|
|
|
|
|
Operating loss
|
|
(1,759)
|
(1,299)
|
Loss before taxation
Taxation
|
9
|
(1,759)
-
|
(1,299)
-
|
Loss for the year attributable to the owners of the
Company
|
|
(1,759)
|
(1,299)
|
Other comprehensive income
Items that may be reclassified subsequently
to
profit or loss:
Exchange rate differences on
translation of foreign operations
|
|
1
|
29
|
Total comprehensive loss attributable to the owners of the
Company
|
|
(1,758)
|
(1,270)
|
|
|
|
|
|
|
Pence
|
Pence
|
Earnings per share - basic and diluted
|
10
|
(0.638)
|
(0.610)
|
The notes form part of these
financial statements
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
AS AT 31 MARCH 2024
|
Note
|
2024
£'000
|
2023
£'000
|
Assets
Non-current assets
|
|
|
|
Intangible assets
|
11
|
3,202
|
2,479
|
Property, plant and
equipment
|
12
|
1
|
2
|
Total non-current assets
|
|
3,203
|
2,481
|
Current assets
|
|
|
|
Trade and other
receivables
|
14
|
93
|
190
|
Cash and cash
equivalents
|
15
|
503
|
654
|
Total current assets
|
|
596
|
844
|
Total assets
|
|
3,799
|
3,325
|
Liabilities
|
|
|
|
Current Liabilities
|
|
|
|
Trade and other
payables
|
16
|
(204)
|
(126)
|
Total liabilities
|
|
(204)
|
(126)
|
Net current assets
|
|
392
|
718
|
|
|
|
|
Net assets
|
|
3,595
|
3,199
|
|
|
|
|
|
Equity
|
|
|
|
Share capital
|
18
|
3,435
|
2,133
|
Share premium
Share based payment
reserve
|
20
19
|
3,816
342
|
3,176
236
|
Foreign currency translation
reserve
|
20
|
6
|
5
|
Retained earnings
|
20
|
(4,004)
|
(2,351)
|
Total equity attributable to the owners of the
Company
|
|
3,595
|
3,199
|
The notes form part of these
financial statements
COMPANY STATEMENT OF CASH FLOWS
YEAR ENDED 31 MARCH 2024
|
|
|
Year ended
31 March
2024
£'000
|
Year ended
31 March
2023
£'000
|
Net cash flows from operating activities
|
|
|
|
|
Loss for the year
|
|
|
(1,131)
|
(479)
|
|
|
|
|
|
Adjustments for:
|
|
|
|
|
Share based payments
|
|
|
212
|
89
|
Remuneration settled through issue
of shares
|
|
|
68
|
29
|
|
|
|
|
|
Working capital adjustments
|
|
|
|
|
Increase in long term
receivables
|
|
|
(1,257)
|
(1,350)
|
Decrease in trade and other
receivables
|
|
|
37
|
129
|
Increase/(decrease) in trade and
other payables
|
|
|
35
|
(92)
|
Net cash used in operations
|
|
|
(2,036)
|
(1,674)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
Issue of ordinary share capital,
net of issue costs
|
|
|
1,376
|
-
|
Proceeds from convertible loan
note
|
|
|
501
|
-
|
Net cash generated from financing
activities
|
|
|
1,877
|
-
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
(159)
|
(1,674)
|
Cash and cash equivalents brought forward
|
|
|
651
|
2,325
|
Cash and cash equivalents carried forward
|
|
|
492
|
651
|
Significant non-cash transactions
from investing and financing activities are as follows:
|
|
|
2024
£'000
|
2023
£'000
|
Share option charge
Remuneration settled through issue
of shares
|
|
|
212
68
|
89
29
|
Shares issued to redeem
convertible loan note
|
|
|
501
|
-
|
Issuance of shares in lieu of
option payment
|
|
|
20
|
-
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 MARCH 2024
1. General Information
Great Southern Copper plc ('the
Company') and its subsidiaries (together 'the Group') principal
activity is currently focused upon the exploration for copper and
gold in Chile. Further detail is covered in the Chairman's
Statement and also in the Operations Report.
The Company is a public limited
Company, which is listed on the London Stock Exchange and
incorporated and domiciled in England and Wales. The address of its
registered office is Salisbury House, London Wall, London, United
Kingdom, EC2M 5PS.
2. Basis of Preparation
The consolidated Group financial
statements and Company financial statements have been prepared in
accordance with United Kingdom ("UK") adopted International
Accounting Standards ('IFRS') and those parts of the Companies Act
2006 applicable to companies reporting under IFRS. The consolidated
Group financial statements and Company financial statements are
presented in Sterling and rounded to the nearest thousand pound
unless otherwise indicated. The financial statements are prepared
on the historical cost basis, except for certain financial
instruments and share-based payments that have been measured at
fair value. The financial statements are presented in £ Sterling
and rounded to the nearest £'000 unless otherwise
stated.
Going Concern
Basis
In common with many other mineral
exploration companies, the Group has raised equity and debt finance
for its exploration activities. The Board recognises that further
finance will need to be raised as and when required to progress its
exploration projects and add shareholder value. The Board also
acknowledges that previous success in raising funds does not
necessarily provide any guarantee that the Group will be able to do
so in the future.
As at 31 March 2024, the Group's
cash at bank amounted to £503k; at the date of signing this report,
the balance of cash and committed funds amounted to
£1,005k.
The Board has reviewed the Group's
cash flow forecast up to 31 July 2025 and are aware that additional
funds will need to be sourced in order to continue to advance its
exploration activities and continue as a going concern for a period
of at least 12 months from the approval of these financial
statements. The Directors are confident that they will be
able to secure the necessary funding in order to enable the Group
to continue to advance its projects, however the requirement for
further uncommitted fundings casts significant doubt over the
Group's ability to continue as a going concern. The auditors
have acknowledged this going concern uncertainty in their
unqualified audit report.
The Board continues to closely
monitor its cash position, allocate funds in line with its detailed
budget and maintain a strict control over non-project spend.
The Directors remain confident in the Company's ability to raise
additional funds as required, from existing and/or new investors
and therefore consider it appropriate to continue to adopt the
going concern basis of accounting in preparing these financial
statements.
3. Accounting Policies
The principal accounting policies
adopted are set out below.
Basis of
Consolidation
The consolidated financial
statements incorporate the assets, liabilities, income and expenses
of the Company and entity controlled by the Company (its
subsidiary) made up to the Company's accounting reference date.
Control is achieved when the Company has the power over the
investee, is exposed or has rights to variable return from its
involvement with the investee and has the ability to use its power
to affect its returns. The Company reassesses whether or not it
controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements of control listed
above.
Consolidation of a subsidiary
begins when the Company obtains control over the subsidiary and
ceases when the Company loses
control of the subsidiary. Specifically, the
results of subsidiaries acquired or disposed of during the period
are included in the consolidated income statement from the date
that the Company gains control until the date when the Company
ceases to control the subsidiary.
Where necessary, adjustments are
made to the financial statements of a subsidiary to bring the
accounting policies used into line with the Group's accounting
policies. All intra group assets and liabilities, equity, income,
expenses and cash flows, relating to transactions between the
members of the Group, are eliminated on consolidation.
The results of overseas
subsidiaries are translated at the monthly average rates of
exchange during the period and their statements of financial
position at the rates ruling at the reporting date. Exchange
differences arising on translation of the opening net assets and on
foreign currency borrowings or deferred consideration, to the
extent that they hedge the Group's investment in such subsidiaries,
are reported in the statement of comprehensive income. The
financial statements of the subsidiary are drawn up to 31 December,
with management information utilised to take this out to 31 March
in line with the reporting period of the Group.
Currencies
Presentational
Currency
Items included in the financial
statements are measured using the currency of the primary economic
environment in which the ultimate parent undertaking operates which
is Sterling (£). The functional currency of the only subsidiary of
the Group is the United States Dollar ($).
Transactions and
Balances
Foreign currency transactions are
translated into the functional currency using the exchange rates
prevailing at the dates of the transactions or at an average rate
for a period if the rates do not fluctuate significantly. Foreign
exchange gains and losses, resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies, are recognised in the income
statement. Non-monetary items that are measured in terms of
historical cost in a foreign currency are not
retranslated.
Revenue
Recognition
Revenue is recognised in the
individual company financial statements in respect of management
fees charged to the subsidiary company. Revenue is recognised in
respect of the period that the service has been
completed.
Intangible Assets -
Exploration and Evaluation Expenditure
Mineral exploration and evaluation
expenditure relates to costs incurred in the exploration and
evaluation of potential mineral resources and includes exploration
and mineral licences, researching and analysing historical
exploration data, exploratory drilling, trenching, sampling and the
costs of pre-feasibility studies.
Exploration and evaluation
expenditure for each area of interest, other than that acquired
from another entity, is charged to profit or loss as incurred
except when the expenditure is expected to be recouped from future
exploitation or sale of the area of interest and it is planned to
continue with active and significant operations in relation to the
area, or at the reporting period end, the activity has not reached
a stage which permits a reasonable assessment of the existence of
commercially recoverable reserves, in which case the expenditure is
capitalised. Purchased exploration and evaluation assets are
recognised at their fair value at acquisition. As the capitalised
exploration and evaluation expenditure asset is not available for
use, it is not depreciated.
Exploration and evaluation assets
have an indefinite useful life and are assessed for impairment when
facts and circumstances may suggest an impairment and circumstances
suggest that the carrying amount of an asset may exceed its
recoverable amount. The assessment is carried out by allocating
exploration and evaluation assets to cash generating units, which
are based on specific projects or geographical areas. IFRS 6
permits impairments of exploration and evaluation expenditure to be
reversed should the conditions which led to the impairment improve.
The Group continually monitors the position of the projects
capitalised and
impaired.
Whenever the exploration for and
evaluation of mineral resources in cash generating units does not
lead to the discovery of commercially viable quantities of mineral
resources and the Group has decided to discontinue such activities
of that unit, the associated expenditures are written off to profit
or loss.
Income Tax
The tax expense or credit
represents the sum of the tax currently payable or recoverable and
the movement in deferred tax assets and liabilities.
Current Income
Tax
Current tax is based upon taxable
income for the year and any adjustment to tax from previous years.
Taxable income differs from net income in the income statement
because it excludes items of income or expense that are taxable or
deductible in other years or that are never taxable or deductible.
The calculation uses the latest tax rates for the year that have
been enacted or substantively enacted by the reporting
date.
Deferred
Tax
Deferred tax is calculated at the
latest tax rates that have been substantively enacted by the
reporting date that are expected to apply when settled. It is
charged or credited to profit or loss, except when it relates to
items credited or charged directly to equity, in which case it is
also dealt with in equity.
Deferred tax is the tax expected
to be payable or recoverable on differences between the carrying
amounts of assets and liabilities in the financial statements and
the corresponding tax bases used in the computation of taxable
income and is accounted for using the liability method. Deferred
tax liabilities and assets are not discounted.
Deferred
Tax
Deferred tax liabilities are
generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is
probable that taxable income will be available against which the
asset can be utilised. Such assets are reduced to the extent that
it is no longer probable that the asset can be utilised.
Deferred tax assets and
liabilities are offset when there is a right to offset current tax
assets and liabilities and when the deferred tax assets and
liabilities relate to taxes levied by the same taxation authority,
on either the same taxable entity or different taxable entities,
where there is an intention to settle the balances on a net
basis.
Payroll Expense and Related
Contributions
The Group provides a range of
benefits to employees, including annual bonus arrangements, paid
holiday arrangements and defined contribution pension
plans.
Short-term benefits, including
holiday pay and other similar non-monetary benefits, are recognised
as an expense in the period in which the service is
received.
Pension
Costs
The Group operates a defined
contribution pension scheme for employees. The annual contributions
payable are charged to profit or loss.
Share-Based
Compensation
The Group issues share-based
payments to certain employees and Directors. Equity-settled
share-based payments are measured at fair value at the date of
grant and expensed on a straight-line basis over the vesting
period, along with a corresponding increase in equity. The Group
has measured share based payments using the Black Scholes and Monte
Carlo option (note 19) models.
At each reporting date, the Group
revises its estimate of the number of equity instruments expected
to vest as a result of the effect of non-market based vesting
conditions. The impact of any revision is recognised in profit or
loss, with a corresponding adjustment to equity
reserves.
The fair values of share options
are determined using the Monte Carlo and Black Scholes models,
taking into consideration the best estimate of the expected life of
the option and the estimated number of shares that will eventually
vest.
Financial
Instruments
Financial assets and financial
liabilities are recognised in the Statement of Financial Position
when the Group becomes party to the contractual provisions of the
instrument. Financial assets are
derecognised when the contractual rights to the cash flows from the
financial asset expire or when the contractual rights to those
assets are transferred. Financial liabilities are derecognised when
the obligation specified in the contract is discharged, cancelled
or expired.
Impairment of Financial
Instruments
The Group recognises an allowance
for expected credit losses ('ECLs') for all debt instruments not
held at fair value through profit or loss. ECLs are based on the
difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to
receive, discounted at an approximation of the original effective
interest rate ('EIR'). The expected cash flows will include cash
flows from the sale of collateral held or other credit enhancements
that are integral to the contractual terms
IFRS 9.5.5.1 ECLs are recognised
in two stages. For credit exposures for which there has not been a
significant increase in credit risk since initial recognition, ECLs
are provided for credit losses that result from default events that
are possible within the next 12-months (a 12-month ECL). For those
credit exposures for which there has been a significant increase in
credit risk since initial recognition, a loss allowance is required
for credit losses expected over the remaining life of the exposure,
irrespective of the timing of the default (a lifetime
ECL).
The Group considers a financial
asset in default when contractual payments are 90 days past due.
However, in certain cases, the Group may also consider a financial
asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding
contractual amounts in full before taking into account any credit
enhancements held by the Group. A financial asset is written off
when there is no reasonable expectation of recovering the
contractual cash flows and usually occurs when past due for more
than one year and not subject to enforcement activity.
At each reporting date, the Group
assesses whether financial assets carried at amortised cost are
credit impaired. A financial asset is credit-impaired when one or
more events that have a detrimental impact on the estimated future
cash flows of the financial asset have occurred.
Property Plant and
Equipment
Property, plant and equipment are
stated at cost net of accumulated depreciation and accumulated
impairment losses. Cost comprises purchase cost together with any
incidental costs of acquisition.
Depreciation is provided to write
down the cost less the estimated residual value of all tangible
fixed assets by equal instalments over their estimated useful
economic lives on a straight-line basis. The following rates are
applied.
Computer equipment
|
3 years straight line
|
The gain or loss arising on the
disposal of an asset is determined as the difference between the
sale proceeds and the carrying value of the asset and is credited
or charged to profit or loss.
Trade and Other
Receivables
Trade and other receivables, and
amounts owed by Group undertakings, are classified at amortised
cost and recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method
(except for short-term receivables where interest is immaterial)
less provisions for impairment. These
assets are held to collect contractual cash flows being solely the
payments of the principal amount and interest. Provisions for impairment of trade receivables are recognised
for expected lifetime credit losses using the simplified approach.
Impairment reviews of other receivables, including those due from
related parties, use the general approach whereby twelve month
expected losses are provided for and lifetime credit losses are
only recognised where there has been a significant increase in
credit risk, by monitoring the creditworthiness of the other
party.
Cash and Cash
Equivalents
Cash and cash equivalents are held
at amortised cost and consist of cash on hand, demand deposits and
other short-term highly liquid investments that are readily
convertible to a known amount of cash and are subject to an
insignificant risk of changes in value. Further details are given
in note 15.
Trade and Other
Payables
Trade and other payables are
initially measured at their fair value and are subsequently
measured at their amortised cost using the effective interest rate
method. This method allocates interest expense over the relevant
period by applying the 'effective interest rate' to the carrying
amount of the liability.
Classification As Debt Or
Equity
Debt and equity instruments issued
by the Group are classified as either financial liabilities or as
equity in accordance with the substance of the contractual
arrangements and the definitions of a financial liability and an
equity instrument.
Equity
Instruments
An equity instrument is any
contract that evidences a residual interest in the assets of an
entity after deducting all of its liabilities. Equity instruments
issued by the Group are recognised at the proceeds received, net of
direct issue costs.
Convertible loan
notes
The convertible loan note issued
during the year is considered to be a compound financial instrument
comprising a financial liability (loan) and an embedded derivative
(equity). At the date of issue both elements were included in the
balance sheet as liabilities and held at fair value as the equity
element was considered immaterial. The fair value of the loan
element was estimated using the prevailing market interest rate for
similar non convertible debt. Subsequently the loan element was
accounted for at amortised cost. On conversion of the loan note to
equity, the difference between the nominal value of the equity
issued and the contracted conversion price was credited to the
share premium account.
Accounting
Developments
There have been no new standards,
amendments and interpretations adopted in the preparation of the
financial statements. The Group does not expect any standards
issued by the IASB, but not yet effective, to have a material
impact on the Group.
4. Critical Accounting Estimates and
Judgements
The preparation of these financial
statements requires management to make judgements and estimates
that affect the reported amounts of assets and liabilities at each
reporting date and the reported results. Actual results could
differ from these estimates. Information about such judgements and
estimations is contained in individual accounting policies.
Accounting Estimates and Judgements
The key accounting estimates and
judgements used in the preparation of the financial statements are
as follows:
Recognition and Valuation of
Exploration Assets
Exploration and evaluation assets
include mineral rights and exploration and evaluation costs,
including geophysical, topographical, geological and similar types
of costs. Exploration and evaluation costs are capitalised if
management concludes that future economic benefits are likely to be
realised and determines that economically viable extraction
operation can be established as a result of exploration activities
and internal assessment of mineral resources. According to 'IFRS 6
Exploration for and evaluation of mineral resources', the potential
indicators of impairment include: management's plans to discontinue
the exploration activities, lack of further substantial exploration
expenditure planned, expiry of exploration licences in the period
or in the nearest future, or existence of other data indicating the
expenditure capitalised is not recoverable. At the end of each
reporting period, management assesses whether such indicators exist
for the exploration and evaluation assets capitalised, which
requires significant judgement. As of 31 March 2024 total
exploration and evaluation costs capitalised amounted to £3,202,080
(2023: £2,478,738). Refer to note 11 for more
information.
Carrying Value of
Investments in Subsidiary Undertakings
Management must consider the
carrying value of investments in subsidiary companies based on the
ongoing performance of said company. The nature of the judgement
will impact whether or not there is deemed to be any indicators of
impairment, which could materially impact the carrying value of
those investments. The key driver of the assessment is linked to
the impairment review carried out in respect of exploration assets.
The impairment review is carried out under IAS 36 - Impairment of
assets and assesses impairment indicators such as market value
declines, negative changes in the industry and obsolescence of the
underlying assets. At 31 March 2024, the carrying value
amounted to £5,269,417 (2023: £3,992,000). Refer to note 13
for more information.
Share Based
Payments
The Group measures the cost of
equity-settled transactions with employees by reference to the fair
value of the equity instruments at the date at which they are
granted. The fair value is determined by using either the Monte
Carlo or Black-Scholes model taking into account the terms and
conditions upon which the instruments were granted, see note 19 for
further details.
5. Operating Segments
Operating segments are reported in
a manner that is consistent with the internal reporting provided to the chief
operating decision maker. The chief
operating decision maker has been identified as the Board. The
Board is responsible for allocating resources and assessing
performance of operating segments.
The Group has two reportable
segments, exploration and corporate, which are the Group's
strategic divisions. For each of the strategic divisions the Board
reviews internal management reports on a regular basis.
The Group's reportable segments
are:
Exploration: the exploration
segment is presented as an aggregate of all Chile licences
held.
Expenditure on exploration
activities for each licence is used to measure agreed upon
expenditure targets for each licence to ensure the licence clauses
are met.
Corporate: the corporate segment
includes the holding company costs in respect of managing the
Group.
Segment result:
|
|
2024
£'000
|
2023
£'000
|
Exploration - Chile
Corporate - UK
|
|
(628)
(1,131)
|
(820)
(478)
|
Loss before tax
|
|
(1,759)
|
(1,299)
|
|
|
|
|
Taxation
|
|
-
|
-
|
Loss after tax
|
|
(1,759)
|
(1,299)
|
Segment assets and
liabilities:
Non current assets
|
|
2024
£'000
|
2023
£'000
|
Exploration - Chile
Corporate - UK
|
|
3,202
-
|
2,481
-
|
Total
|
|
3,202
|
2,481
|
Total assets
|
|
2024
£'000
|
2023
£'000
|
Exploration - Chile
Corporate - UK
|
|
3,234
565
|
2,541
784
|
Total
|
|
3,799
|
3,325
|
Total liabilities
|
|
2024
£'000
|
2023
£'000
|
Exploration - Chile
Corporate - UK
|
|
(64)
(140)
|
(21)
(105)
|
Total
|
|
(204)
|
(126)
|
6. Operating Expenses
|
|
2024
£'000
|
2023
£'000
|
Staff costs (including share based
payments)
|
|
700
|
494
|
Foreign exchange
loss/(gain)
|
|
68
|
(27)
|
Auditor's remuneration
|
|
80
|
63
|
Travel expenses
|
|
90
|
46
|
Legal, professional &
consultancy fees
|
|
250
|
231
|
Insurance
|
|
36
|
32
|
Subcontracted labour
|
|
252
|
202
|
Other administrative
expenses
|
|
283
|
257
|
Total
|
|
1,759
|
1,299
|
As per the accounting policy
disclosed in note 3 the Group has made the policy choice to only
capitalise specific identifiable exploration costs as an intangible
asset. Related administration and contractor costs (including
staff and labour costs) are expensed as incurred.
7. Auditor's Remuneration
|
|
2024
£'000
|
2023
£'000
|
Fees payable to the Company's
auditor for the audit of the parent and consolidated annual
accounts
|
|
55
|
60
|
Total audit fees
|
|
55
|
60
|
|
|
|
|
Audit-related assurance
services
|
|
35
|
3
|
Total non-audit fees
|
|
35
|
3
|
8. Employee Numbers and Costs
The average monthly number of people employed was:
|
Group
|
Company
|
|
2024
|
2023
|
2024
|
2023
|
|
Number
|
Number
|
Number
|
Number
|
Average number of employees:
Directors
|
5
|
4
|
5
|
4
|
Administrative staff
|
5
|
5
|
-
|
1
|
Total
|
10
|
9
|
5
|
5
|
The aggregate remuneration of all
employees, including Directors, comprises:
|
Group
|
Company
|
|
2024
£'000
|
2023
£'000
|
2024
£'000
|
2023
£'000
|
Wages and salaries
|
451
|
341
|
324
|
243
|
Social security costs
|
23
|
22
|
13
|
14
|
Other pension costs
|
14
|
13
|
14
|
13
|
Share based payments
|
212
|
118
|
219
|
118
|
Total
|
700
|
494
|
570
|
388
|
Details of Directors' remuneration and pension
entitlements are disclosed in the Remuneration Report on page 16 of
the Annual Report. Please refer to the Directors Remuneration
report and related party note (note 21) for additional disclosure
relating to key management personnel.
The aggregate amount of gains made
by Directors on the exercise of share options was £Nil (2023:
£Nil).
9. Taxation
|
|
2024
£'000
|
2023
£'000
|
Current tax
|
|
|
|
Current period - UK corporation
tax
|
|
-
|
-
|
Adjustments in respect of prior
periods
|
|
-
|
-
|
Foreign current tax
expense
|
|
-
|
-
|
Total current tax
|
|
-
|
-
|
|
|
|
|
|
|
|
|
Deferred tax
|
|
|
|
Origination and reversal of
temporary differences
|
|
-
|
-
|
Adjustments in respect of prior
periods
|
|
-
|
-
|
Impact of change in tax
rate
|
|
-
|
-
|
Total deferred tax
|
|
-
|
-
|
|
|
|
|
Total tax charge
|
|
-
|
-
|
The standard rate of tax applied
to reported profit on ordinary activities is 25% (2023: 19%). The
Finance Act 2021, which was substantively enacted on 24 May 2021,
created a 25% main rate, 19% small profits rate and a marginal rate
which is effective from 1 April 2024.
The tax charge for the year can be
reconciled to the loss per the income statement as
follows:
|
|
2024
£'000
|
2023
£'000
|
Loss before tax
|
|
(1,759)
|
(1,299)
|
Tax charge at 25.0 % (2023:
19.0%)
|
|
(440)
|
(247)
|
|
|
|
|
Expenses not deductible for
tax
|
|
56
|
19
|
Remeasurement of deferred tax for
changes in tax rates
|
|
-
|
(23)
|
Adjustments to losses
|
|
-
|
1
|
Difference in overseas tax
rates
|
|
-
|
(49)
|
Movement in deferred tax not
recognised
|
|
384
|
299
|
Total tax expense
|
|
-
|
-
|
Deferred tax in relation to
carried forward losses is not recognised as there is deemed to be
uncertainty over when they will be recoverable.
The Company has tax losses of
£1,344,970 (2023: £449,169) carried forward. The Group has tax
losses of £3,344,205 (2023: £1,809,391) carried forward.
10. Earnings Per Share
Basic earnings per share is
calculated by dividing the net income for the period attributable
to ordinary equity holders by the weighted average number of
ordinary shares outstanding during the period.
Diluted earnings per share amounts
are calculated by dividing the profit attributable to owners of the
parent by the weighted average number of ordinary shares in issue
during the financial year, adjusted for the effects of potentially
dilutive options. The dilutive effect is calculated on the full
exercise of all potentially dilutive ordinary share options granted
by the Group, including performance-based options which the Group
considers to have been earned
The calculations of earnings per
share are based upon the following:
|
|
2024
£'000
|
2023
£'000
|
Loss for the year
|
|
(1,759)
|
(1,299)
|
|
|
Number
|
Number
|
Weighted average number of shares
in issue
|
|
275,726,884
|
212,819,244
|
|
|
|
|
Weighted average number of shares
- basic
|
|
275,726,884
|
212,819,244
|
Share options
|
|
154,531,593
|
160,030,082
|
Weighted average number of shares
- diluted
|
|
430,258,477
|
372,849,326
|
|
|
Pence
|
Pence
|
Earnings per share -
basic
|
|
(0.638)
|
(0.610)
|
Earnings per share -
diluted
|
|
(0.638)
|
(0.610)
|
In accordance with IAS 33, basic
and diluted earnings per share are identical for the Group as the
effect of the exercise of the share options would be to decrease
the loss per share.
11. Intangible Assets
Group
|
|
|
|
|
Exploration
assets
|
Cost
|
|
|
£'000
|
As at 1 April 2022
|
|
|
1,489
|
Additions
|
|
|
924
|
Exchange difference
|
|
|
66
|
As at 1 April 2023
|
|
|
2,479
|
Additions
|
|
|
779
|
Exchange difference
|
|
|
(56)
|
As at 31 March 2024
|
|
|
3,202
|
Accumulated Amortisation
|
|
|
|
As at 1 April 2022
|
|
|
-
|
Charge for the period
|
|
|
-
|
As at 1 April 2023
|
|
|
-
|
Charge for the year
|
|
|
-
|
As at 31 March 2024
|
|
|
-
|
Carrying Amount:
|
|
|
|
As at 31 March 2024
|
|
|
3,202
|
As at 31 March 2023
|
|
|
2,479
|
Exploration projects in Chile are
at an early stage of development and there are no JORC (Joint Ore
Reserves Committee) or non-JORC compliant resource estimates
available to enable value in use calculations to be
prepared.
In accordance with IFRS 6, the
Directors undertook an assessment of the following areas and
circumstances which could indicate the existence of
impairment:
· The
Group's right to explore in an area has expired, or will expire in
the near future without renewal.
· No
further exploration or evaluation is planned or budgeted
for.
· A
decision has been taken by the Board to discontinue exploration and
evaluation in an area due to the absence of a commercial level of
reserves.
· Sufficient data exists to indicate that the book value may
not be fully recovered from future development and
production.
Following the year end the Group
dropped a number of non-core concession areas, none of which has
had any material expenditure from historic drilling or exploration
campaigns.
Following their assessment, the
Directors concluded that no impairment charge was necessary for the
year ended 31 March 2024 (2023: £Nil).
The Company had no intangible
assets at 31 March 2024 or 31 March 2023.
12. Property, Plant and Equipment
Group
|
|
|
|
|
Computer
equipment
|
Cost
|
|
|
£'000
|
As at 1 April 2022
|
|
|
-
|
Additions
|
|
|
2
|
Exchange difference
|
|
|
-
|
As at 1 April 2023
|
|
|
2
|
Additions
|
|
|
-
|
Exchange difference
|
|
|
-
|
As at 31 March 2024
|
|
|
2
|
Accumulated Depreciation
|
|
|
|
As at 1 April 2022
|
|
|
-
|
Charge for the period
|
|
|
-
|
As at 1 April 2023
|
|
|
-
|
Charge for the year
|
|
|
(1)
|
Exchange difference
|
|
|
-
|
As at 31 March 2024
|
|
|
(1)
|
Carrying Amount:
|
|
|
|
As at 31 March 2024
|
|
|
1
|
As at 31 March 2023
|
|
|
2
|
The Company had no plant, property
and equipment at 31 March 2024 or 31 March 2023.
13. Investments
Company
|
Amounts owed by
subsidiary
£'000
|
Shares in group
undertakings
£'000
|
Total
£'000
|
At 1
April 2023
|
2,770
|
1,222
|
3,992
|
Additions
|
1,277
|
-
|
1,277
|
Carrying value at end of the
year
|
4,047
|
1,222
|
5,269
|
At 31 March 2024 the Company owned
the following subsidiary:
|
Registered
Office
|
Holding
|
Proportion of
Voting Rights and Shares Held
|
Nature of
Business
|
Pacific Trends Resources Chile
SpA
|
1
|
Ordinary
Shares
|
100%
|
Mining
and exploration
|
1. Avenue El Bosque Central
No. 92, 7th floor, Borough of Las Condes, Metropolitan
Region
The credit risk of related parties
is estimated based on the expected recoverable amount, taking into
account the creditworthiness of the other party. Any expected
credit loss is calculated based on the general approach as set out
in IFRS 9. The Directors have determined that there has not been an
increased credit risk within the year and no impairment charge has
been recognised against these balances.
Amounts owed by group undertakings
are interest free and are due on demand. The recoverability of this
debt is dependent upon the liquidity of the subsidiary's intangible
assets. More details can be found in note 11.
14. Trade and Other Receivables
|
|
|
Group
|
|
|
|
2024
£'000
|
2023
£'000
|
Other receivables
|
|
|
8
|
50
|
Prepayments
|
|
|
85
|
140
|
|
|
|
93
|
190
|
|
|
|
|
|
|
|
|
|
Company
|
|
|
|
2024
£'000
|
2023
£'000
|
Other receivables
|
|
|
8
|
34
|
Prepayments
|
|
|
64
|
99
|
|
|
|
72
|
133
|
|
|
|
|
|
|
|
|
|
| |
Other receivables consist of
amounts owed in respect of shares subscribed for as part of the
IPO, as well as amounts due in respect of VAT.
15. Cash and Cash Equivalents
|
|
|
Group
|
|
|
|
2024
£'000
|
2023
£'000
|
Cash at bank
|
|
|
503
|
654
|
|
|
|
Company
|
|
|
|
2024
£'000
|
2023
£'000
|
Cash at bank
|
|
|
492
|
651
|
Banking facilities utilised by the
Group are rated as follows:
·
Bendigo and Adelaide Bank
A-
(Fitch)
· Revolut
No rating available
·
Banco Security
BBB
(Fitch)
Cash was held in the following
currencies:
|
|
|
Group
|
|
|
|
2024
£'000
|
2023
£'000
|
GBP Sterling
|
|
|
421
|
33
|
US Dollars
|
|
|
11
|
592
|
Australian Dollars
|
|
|
62
|
25
|
Chilean Peso
|
|
|
9
|
4
|
|
|
|
503
|
654
|
16. Trade and Other Payables
|
|
|
Group
|
|
|
|
2024
£'000
|
2023
£'000
|
Other payables
|
|
|
136
|
55
|
Accruals
|
|
|
68
|
71
|
|
|
|
204
|
126
|
Other payables principally consist
of amounts outstanding for trade purchases and ongoing costs. They
are non-interest bearing and are typically settled on 30
to 60 day
terms.
The Directors consider that the
carrying value of trade and other payables approximates their fair
value. Trade and other payables are denominated in Sterling. Great
Southern Copper plc has financial risk management policies in place
to ensure that all payables are paid within the credit time
frame and no interest has been charged by any
suppliers as a result of late payment of invoices during the
period.
|
|
|
Company
|
|
|
|
2024
£'000
|
2023
£'000
|
Other payables
|
|
|
70
|
34
|
Accruals
|
|
|
68
|
70
|
|
|
|
138
|
104
|
17. Financial Instruments
Principal Financial
Instruments
The principal financial
instruments used by the Group, from which financial instrument risk
arises, are as follows:
Financial
Assets
The Group held the following
financial assets at amortised cost:
|
|
Group
|
|
|
2024
£'000
|
2023
£'000
|
Cash and cash
equivalents
Other receivables (excluding VAT
and prepayment)
|
|
503
-
|
654
42
|
|
|
503
|
696
|
|
|
|
|
|
|
| |
Financial
Liabilities
The Group held the following
financial liabilities, classified as other financial liabilities at
amortised cost:
|
|
Group
|
|
|
2024
£'000
|
2023
£'000
|
Other payables and
accruals
|
|
204
|
125
|
|
|
204
|
125
|
Financial
Assets
The Company held the following
financial assets at amortised cost:
|
|
Company
|
|
|
2024
£'000
|
2023
£'000
|
Cash and cash
equivalents
|
|
492
|
651
|
Other receivables (excluding VAT
and prepayments)
|
|
-
|
26
|
|
|
492
|
677
|
Financial
Liabilities
The Company held the following
financial liabilities, classified as other financial liabilities at
amortised cost:
|
Company
|
|
|
2024
£'000
|
2023
£'000
|
Other payables and
accruals
|
|
138
|
104
|
|
|
138
|
104
|
The Group's activities expose it
to certain financial risks: market risk, credit risk and liquidity
risk. The overall risk management programme focuses
upon the
unpredictability of financial markets and seeks to minimise
potential adverse effects on the Group's financial performance.
Risk management is carried out by the Directors, who identify and
evaluate financial risks in close cooperation with key members of
staff.
Market
Risk
Market risk is the risk of loss
that may arise from changes in market factors such as interest
rates and foreign exchange rates.
Foreign Currency Risk
Management
Currency risk is the risk that the
financial results of the Group will be adversely affected by
changes in exchange rates to which the Group is exposed. No foreign
currency sensitivities have been included as they are deemed to be
immaterial. The Group undertakes certain transactions denominated
in foreign currencies. The majority of the Company's expenditures
are denominated in Pound Sterling, while its exploration expenses
are incurred in US Dollars, accordingly, the result for the year
are adversely impacted by depreciation of the Pound Sterling
against the US$ while the Group's assets are positively impacted by
appreciation of the US$ against the Pound. Currency risk is
monitored on a regular basis.
The following is a note of the
assets and liabilities denominated at each period end in US
Dollars:
|
|
|
|
|
Group
|
|
|
|
|
|
2024
|
2023
|
|
|
|
|
|
$'000
|
$'000
|
Other receivables
|
|
|
|
10
|
19
|
Cash and cash
equivalents
|
|
|
|
14
|
736
|
Other payables
|
|
|
|
(170)
|
(26)
|
|
|
|
|
(146)
|
729
|
|
|
|
|
|
|
|
|
|
| |
Liquidity
Risk
Liquidity risk is the risk that
the Group will not be able to meet its financial obligations as
they fall due. This risk relates to the Group's prudent liquidity
risk management and implies maintaining sufficient cash. The
Directors monitor rolling forecasts of the Group's liquidity and
cash and cash equivalents based upon expected cash flow.
Credit
Risk
Credit risk is the risk that a
customer may default or not meet its obligations to the Group on a
timely basis, leading to financial losses to the Group. Credit risk
arises from cash and deposits kept with banks, advances paid and
other receivables. The maximum exposure to credit risk at the
reporting date to recognised financial assets is the carrying
amount, net of any provisions for impairment of those assets, as
disclosed in the statement of financial position and notes to the
financial statements. The consolidated entity does not hold any
collateral.
Generally, other receivables are
written off when there is no reasonable expectation of recovery.
Indicators of this include the failure of a debtor to engage in a
repayment plan, no active enforcement activity and a failure to
make contractual payments for a period greater than 1
year.
Capital Risk
Management
The Group's objectives when
managing capital are to safeguard the Group's ability to continue
as a going concern, to enable the Group to continue its exploration
and evaluation activities, and to maintain an optimal capital
structure to reduce the cost of capital. In order to maintain or
adjust the capital structure, the Group may adjust the issue of
shares or sell assets to reduce debts.
At 31 March 2024 the Group had
borrowings of £Nil (2023: £Nil) and defines capital based on the
total equity of the Group. The Group monitors its level of cash
resources available against future planned exploration and
evaluation activities and may issue new shares in order to raise
further funds from time to time.
Fair Value
Estimation
The carrying value of other
receivables and payables are assumed to approximate to their fair
values because of the short-term nature of such assets and the
effect of discounting liabilities is negligible.
The Group is exposed to the risks
that arise from its financial instruments. The policies for
managing those risks and the methods to measure them are described
earlier in this note.
Maturity Of Financial Assets
And Liabilities
All of the Group's non-derivative
financial liabilities and its financial assets at the reporting
date are either payable or receivable within one year.
18. Share Capital
Number of Shares in
Issue
|
2024
|
Ordinary share capital
|
Number
|
£'000
|
Authorised, Issued and fully paid:
|
|
|
Ordinary shares of £0.01 as at 1
April 2023
|
212,336,411
|
2,133
|
Issued during the year
|
130,155,076
|
1,302
|
Ordinary shares of £0.01 as at 31
March 2024
|
343,491,487
|
3,435
|
Rights of Share
Capital
Ordinary shares carry rights to
dividends and other distributions from the Company, as well as
carrying voting rights.
On 19 May 2023, the Company issued
41,749,998 ordinary shares with a nominal value of £0.01 per share,
through a placing and subscription at a share price of £0.0120,
raising £501,000 before costs.
On 14 December 2023, the Company
issued 40,222,206 ordinary shares with a nominal value of £0.01 per
share, through a placing and subscription at a share price of
£0.0225, raising £905,000 before costs.
On 14 December 2023, the Company
issued 41,749,995 ordinary shares with a nominal value of £0.01 per
share, following the conversion of a convertible loan facility
between the Company and its major shareholder, at a share price of
£0.0120 per share (see note 23).
On 14 December 2023, the Company
issued 1,693,767 ordinary shares with a nominal value of £0.01 per
share, as part payment to the vendors of the San Lorenzo project,
at a share price of £0.0120 per share.
On 14 December 2023, the Company
issued 4,436,834 ordinary shares with a nominal value per share of
£0.01 as remuneration for work performed by key management
personnel. The amount of remuneration in relation to the share
issue amounted to £60,656.
On 16 January 2024, the Company
issued 302,276 ordinary shares with a nominal value per share of
£0.01 as remuneration for work performed by key management
personnel. The amount of remuneration in relation to the share
issue amounted to £7,817.
19. Share Based
Payments
The Group had warrants and share
option schemes in place during the year ended 31 March 2024 and 31
March 2023 as follows:
Warrants - outstanding at
the beginning of the year
On 7 December 2021 the Company
issued 148,327,850 warrants. The warrants were granted in the
following tranches:
1. 60,555,550 granted
to Pacific Trends Resources Pty Ltd following the acquisition of
Pacific Trends Resources Chile SpA.
2. 1,407,300 Broker
warrants grated as part of the IPO.
3. 70,365,000 placing
warrants granted as part of the IPO.
4. 16,000,000
conversion warrants granted to Foreign Dimensions Pty Ltd, the
largest individual shareholder.
All the above warrants, with the
exception of the Broker Warrants entitled the holder to subscribe
for one ordinary share at a price of £0.10 per share. The warrants
became exercisable on admission and had a maximum life of two
years. All warrants, excepting the Broker Warrants time expired
during the year. The Broker warrants have an exercise price of
£0.05 and a life of three years.
Warrants - granted during
the year
On 19 May 2023, the Company issued
41,749,998 warrants (conditional on the publication of a prospectus
that was subsequently issued on 7 December 2023) in relation to a
share placing and subscription.
On 19 May 2023, the Company issued
41,749,995 warrants (conditional on the publication of a prospectus
that was subsequently issued on 7 December 2023) in relation to a
convertible loan note (see note 23).
The above warrants entitled the
holder to subscribe for one ordinary share at a price of £0.024 per
share. The warrants became immediately exercisable and had a
maximum life of three years.
On 14 December 2023, the Company
issued 40,222,206 warrants in relation to a share placing and
subscription. The warrants entitled the holder to subscribe
for one ordinary share at a price of £0.045 per share. The
warrants became immediately exercisable and had a maximum life of
two years
|
Number of
warrants
|
Weighted average exercise
price
|
Number of
warrants
|
Weighted average exercise
price
|
2024
|
2024
|
2023
|
2023
|
Outstanding at beginning of the
year
|
148,327,850
|
£0.10
|
148,327,850
|
£0.10
|
Granted during the year
|
123,722,199
|
£0.03
|
1,407,300
|
£0.05
|
Cancelled during the
year
|
-
|
-
|
(1,407,300)
|
£0.05
|
Lapsed during the year
|
(146,920,550)
|
£0.10
|
-
|
-
|
Outstanding at the end of the year
|
125,129,499
|
£0.03
|
148,327,850
|
£0.10
|
Exercisable at the end of the year
|
125,129,499
|
£0.03
|
148,327,850
|
£0.10
|
Broker warrants fall within the
scope of IFRS 2 - Share Based Payments as there is an associated
service attached to their issue, whilst the other warrants referred
to above do not confer any such service so have not been subject to
valuation. The weighted average contract length of the warrants is
2 years 8 months, whilst the remaining average contractual life is
1 year 11 months (2023: 8 months).
Share
options
On 19 September 2023 the Company
issued 22,500,000 options to director and other personnel employed
within the group. These options all carry an exercise price
of £0.01 and vest in 3 tranches, 1/3 on the first anniversary of
the grant, 1/3 on the second anniversary of the grant and 1/3 on
the third anniversary of the grant and expire on 19 September
2030.
On 7 December 2021, the Company
issued 11,702,232 options to directors and key personnel employed
within the group as follows:
1.) 10,105,554 options were
granted to directors and a key employee of Great Southern Copper
Plc. These options are split into 2 equal tranches, all carry an
exercise price of £0.05 per share and have the following vesting
conditions:
a.) 50% vest in 3 tranches,
1/3 on admission, 1/3 on the first anniversary of admission and 1/3
on the second anniversary of admission.
b.) 50% vest in 3 tranches,
1/3 when the share price reaches £0.10, 1/3 when the share price
reaches £0.15 and 1/3 when the share price reaches
£0.20.
On 19 September 2023, in relation
to the issuance of the new 2023 share options, 4,800,138 share
options (as described in 1b above) were cancelled. The
share-based payment expense in relation to these options was
accelerated and fully recognised in the year totalling
£79,123.
The remaining options must be
exercised by the third anniversary of admission, being 20 December
2024.
2.) 1,596,678 options were
granted to other key personnel, including employees of Pacific
Trends Resources Chile SpA. These options all carry an exercise
price of £0.01 and vest in 3 tranches, 1/3 on admission, 1/3 on the
first anniversary of admission and 1/3 on the second anniversary of
admission.
The above options (2) must be
exercised by 7 December 2026.
|
Number of
options
|
Weighted average exercise
price
|
Number of
options
|
Weighted average exercise
price
|
2024
|
2024
|
2023
|
2023
|
Outstanding at beginning of the
year
|
11,702,232
|
£0.04
|
11,702,232
|
£0.04
|
Exercised during the
year
|
-
|
-
|
-
|
-
|
Granted during the year
|
22,500,000
|
£0.01
|
-
|
-
|
Cancelled during the
year
|
(4,800,138)
|
£0.05
|
-
|
-
|
Outstanding at the end of the year
|
29,402,094
|
£0.02
|
11,702,232
|
£0.04
|
Exercisable at the end of the year
|
6,649,455
|
|
9,485,747
|
|
|
|
|
|
| |
The weighted average contract
length on the options was 6 years (2023: 4 years). The remaining
average contractual life of the options was 5 years 2 months (2023:
3 years 8 months).
Valuation
Given the existence of market
based vesting conditions in certain of the options, the valuation
exercise was split into 2 parts with the options including those
conditions being valued using a Monte Carlo option pricing model,
whilst the other options have been valued using the Black Scholes
option pricing model.
Options granted on 7 December 2021
valued - Monte Carlo Model
|
|
|
Share price at date of
grant
Fair value at the year
end
Exercise price
Time to expiry (years)
Risk-free rate (%) - 3
years
Volatility (%)
Dividend yield (%)
Employee retention rate
(%)
|
£0.0455
£0.02
£0.05
3 years
0.46%
70.0%
0%
100
%
|
Options granted on 7 December 2021
valued - Black Scholes Model
|
|
|
Share price at date of
grant
Fair value at the year end - £0.01
options
Fair value at the year end - £0.05
options
Exercise price
Time to expiry (years)
Risk-free rate (%) - £0.01
options
Risk-free rate (%) - £0.05
options
Volatility (%)
Dividend yield (%)
Employee retention rate
(%)
|
£0.0455
£0.02
£0.01
£0.05;
£0.01
3 and 5
years
0.35%
0.46%
70.0%
0%
100%
for employees with £0.01
options,
100%
for employees with £0.05
options
|
Options granted on 19 September
2023 valued - Black Scholes Model
|
|
|
Share price at date of
grant
Fair value at the year end - £0.01
options
Exercise price
Time to expiry (years)
Risk-free rate (%) - £0.01
options
Volatility (%)
Dividend yield (%)
Employee retention rate
(%)
|
£0.025
£0.017
£0.01
7 years
0.35%
70.0%
0%
100%
for employees with £0.01
options
|
|
|
|
|
|
| |
Volatility is measured using a
weekly share price over a period of 5 years prior to the date of
grant.
The risk-free rate is derived
using a 3 and 5 year gilt rate.
The total share-based payment
expense in relations to warrants and options in the year is
£212,005 (2023: £88,607).
20. Reserves
Share
Premium
Consideration received for shares
issued above their nominal value net of transaction
costs.
Share Based
Payments
The cumulative share-based payment
expenses of unvested awards that have not been
exercised.
Shares To Be
Issued
Shares to be issued to a director
in lieu of cash remuneration.
Foreign Currency
Translation
Cumulative gains and losses in
respect of the translation of the results of overseas subsidiaries
into the presentational currency of the Group.
Retained
Earnings
Cumulative profit and loss net of
distributions to owners.
21. Related Party Transactions
Remuneration Of Key
Personnel - Group
Remuneration of key management personnel, considered to be the Directors
and other senior management of the Group is as follows:
|
|
|
|
2024
|
2023
|
|
|
|
|
£'000
|
£'000
|
Short-term
remuneration*
|
|
|
330
|
257
|
Other pension costs
|
|
|
13
|
13
|
Share-based payments
|
|
|
177
|
94
|
|
|
|
520
|
364
|
Reconciliation of short-term
remuneration
|
|
|
* As above
|
330
|
257
|
Less: Employer's National
Insurance
|
(13)
|
(13)
|
Previous
Chief Financial Officer's
remuneration
|
(32)
|
(70)
|
Add: Remuneration settled through
issue of shares
|
-
|
29
|
Total per Directors' Remuneration
Report - Page 16 in the Annual Report
|
285
|
203
|
Transactions And Balances
With Key Personnel - Group
Balances outstanding to key
personnel at year end totalled to £9,504 (2023:
£13,357).
As at 31 March 2024 a balance of
£14,150 was owed to the largest shareholder (2023:
£14,150).
SI Capital Limited are a related
party through common key management personnel. The charge in
relation to Broker warrants of £Nil (2023: £nil) is included within
share premium. At 31 March 2024 amounts owed to the Group by SI
Capital Limited totalled £nil (2023: £25,000).
During the year payments were made
to third parties in respect of services provided by one of the
Directors. Payments made to SI Capital Limited totalled £25,000
(2023: £21,758) respectively. During the year £25,000 (2023:
£25,000) broker fees were charged by SI Capital Limited.
During the year the charge for the
services of the Chief Executive were made through Metal Ventures
Inc totalling £138,137 (2023: £105,714).
The Directors' disclosures have
been included in the Directors Remuneration report.
22. Contingencies and Commitments
The option agreements held by the
Company in relation to the San Lorenzo and Especularita projects
give the Company the discretionary right to acquire the relevant
concessions, provided the annual option fees totalling US$100,000
due by March 2024 specified in such agreements, have been paid in
full. There are no royalty, third party payments, or other
obligations in favour of third parties regarding the option
payments or the concessions to which they relate.
The Company's commitments to
meeting and finalising its purchase of the mineral concessions
under the Option Agreements, if it chooses to do so, are summarised
in the following table:
Especularita
|
San
Lorenzo
|
Date
|
Payment
|
Date
|
Payment
|
01/03/2025 Final
Payment
|
US$ 1,100,000
|
01/06/2024
|
US$
50,000
|
Extension of final payment to
01/03/2025
|
US$
100,000
|
01/06/2025 Final
Payment
|
US$
1,610,000
|
Extension of final payment to
01/03/2026
|
US$
100,000
|
Extension of final payment to
01/06/2026
|
US$
100,000
|
|
|
Extension of final payment to
01/06/2027
|
US$
100,000
|
To acquire 100% of the
Especularita project a total payment of US$1.5m is required (of
which US$400,000 has been paid to date) with the final payment due
on 01/03/2024. The Company may defer the final payment for a period
of 2 years at a cost of US$100,000 per additional year, which it
has opted to do. To acquire 100% of the San Lorenzo project a total
payment of US$2.0m is required (of which US$340,000 has been paid
to date), with a quota of US$50,000 due before 01/06/2024 and the
final payment due before 01/06/2025. The Company may defer the
final payment for a period of 2 years at a cost of US$100,000 per
additional year, which it has opted to do.
In September 2023, the Company
signed a binding term sheet which allows the Company to earn 100%
of the mining rights of the Monti Lithium project once its
concessions are granted. Details of the related commitments
are given in the table below:
Monti
|
|
Date
|
Cash US$
|
Value in GSC equity
US$
|
01/03/2024 (due
payable)
|
US$50,000
|
-
|
01/09/2024
|
US$50,000
|
US$50,000
|
01/09/2025
|
US$50,000
|
US$50,000
|
01/09/2026
|
US$1,000,000
|
US$1,000,000
|
23. Convertible loan note
On 15 May 2023, the Company
entered into a convertible loan totalling £501,000 with its major
shareholder Foreign Dimensions Pty Ltd. The loan was interest
free, unsecured and automatically converted to equity on issuance
of a prospectus. Following the publication of a prospectus on
7 December 2023, the loan was fully redeemed by conversion
to 41,749,995 ordinary shares with a
nominal value of £0.01 per share (see note 18). No amounts
remained due or payable under the facility at the balance sheet
date.
|
|
|
£'000
|
As at 1 April 2023
|
|
|
-
|
Convertible loan drawn in the
year
|
|
|
501
|
Conversion of loan to
equity
|
|
|
(501)
|
As at 31 March 2024
|
|
|
-
|
The convertible loan note was
initially recognised as a compound financial instrument. The host
contract was recognised as a liability on the balance sheet.
The conversion element would have been recognised as equity,
although the balance was calculated as immaterial, and not relevant
at the year end given the full conversion of the instrument as
detailed above.
24. Post Balance Sheet Events
On 26 June 2024, the Company
completed a fund-raising through the placing and subscription for
104,416,667 new ordinary shares of 1p each at £0.012 per share
raising £1.25m before expenses.
On 12 June 2024, the Company
signed a binding purchase option agreement to acquire the Artemisa
copper project at the Company's Especularita project in
Chile.
On 29 June 2024, the Company
signed a binding purchase option agreement to acquire the Cerro
Negro copper project at the Company's Especularita project in
Chile.
25. Ultimate Controlling Party
In the opinion of the Directors,
there is considered to be no ultimate controlling party.