TIDMNRRP
RNS Number : 7503K
North River Resources Plc
26 September 2016
North River Resources plc / Ticker: NRRP / Index: AIM / Sector:
Mining
26 September 2016
North River Resources plc
('North River' or 'the Company')
Interim Results for the six months ended 30 June 2016
North River Resources plc, the AIM quoted resource company
focused on the Namib Lead-Zinc Project ('Namib Project') in
Namibia, is pleased to provide its unaudited interim results for
the six months ended 30 June 2016.
Highlights:
-- North River continued in its efforts to secure a mining
licence for the Namib Project. A Notice of Preparedness to Grant
the Mining Licence was received from the Namibian Ministry of Mines
and Energy ("Ministry") in January 2016, setting out a process and
timeline for agreement on newly introduced licence conditions, and
a formal proposal to address these conditions was submitted to the
Ministry in late April 2016. The Ministry is yet to respond to this
proposal.
-- The 3,800 metre drill programme continued to progress in the
first half of the year, with a number of drill holes showing
significant mineralisation. Overall results, however, have been
mixed, with drill holes not intersecting mineralization to the
extent anticipated, indicating that achieving a significant
increase in defined mineral resource will require further work to
improve understanding of the structural complexity of the orebody
at depth. Since 30 June 2016, the programmed drilling metres have
been completed in early September, and next steps will be defined
following completion and assessment of final assays.
-- A loss before taxation reported for the 6 months to 30 June
2016 of GBP1,302,437 (30 June 2015: loss of GBP1,377,787).
Post period end:
-- A successful share capital reorganisation and US$ 5.6 million
financing, including an open offer and placing, were completed in
July 2016, allowing the Company to redeem outstanding convertible
loan notes to Greenstone Resources LP. The financing left the
Company effectively debt free and with US$2.5 million in working
capital to support project work programmes in the second half of
the year.
-- New appointments to the Board of Directors of wholly owned
Namibian company, Namibia Lead Zinc and Mining (Pty) Ltd ("NLZM"),
were announced on 26 August 2016. The appointments of Asser Kapere,
Ratonda Kajivikua and Francois du Plessis will greatly strengthen
the NLZM Board in its efforts to advance the mining licence
application and take the Namib Project forward to a construction
decision. Mr Kapere has been appointed as Chairman of the Board of
Directors of NLZM.
-- The Company now faces a critical period of assessment in
determining the way forward for the Namib Project. In regards to
this assessment we are cognisant of both the prolonged, ongoing
uncertainty regarding timing and terms to be attached to the grant
of a mining licence, and the results of the resource expansion
drilling programme.
Chairman's Statement
North River continued in the first half of 2016 to focus on
advancing the Namib Lead Zinc Project in Namibia towards a
construction decision. Against a backdrop of continued uncertainty
surrounding the long outstanding mining licence application, the
clear priorities in the period were to continue pushing for the
grant of the licence, advancing the resource expansion drilling
programme, and raising working capital to support these critical
activities.
As shareholders are aware, a successful share capital
reorganisation and US$ 5.6 million financing, including an open
offer and placing, were completed in July 2016, allowing the
Company to redeem outstanding convertible loan notes to Greenstone
Resources LP and in so doing be left effectively debt free and with
$2.5 million in working capital.
Regarding the Namib Project mining licence application, a Notice
of Preparedness to Grant the Mining Licence was received from the
Ministry in January 2016, setting out a process and timeline for
agreement on newly introduced licence conditions. A formal proposal
was submitted to the Ministry in late April 2016, addressing these
conditions, by committing to: (i) providing an opportunity for
local ownership of the Namib Project; (ii) participation by
historically disadvantaged Namibians in the management of the Namib
Project; and (iii) implementing a corporate social responsibility
strategy.
As per the process set out in the Notice of Preparedness to
Grant, the Ministry then had 30 days to review and respond to the
Company on its proposal. The Ministry however informed NLZM on 2
June 2016, and then again on 3 August 2016, that it requires more
time to review the submitted proposal. No revised date, or
timeframe within which the Company can expect to receive a
response, has been given by the Ministry. While the Company looks
forward to continuing to work with the Ministry on agreeing the
terms and conditions to the grant of the mining licence, the
duration and outcome of these discussions remain uncertain and the
final issue of the Mining Licence on commercially acceptable terms
cannot be guaranteed.
The North River Board also continues to examine the implications
of the Government of the Republic of Namibia's proposed
introduction of broad based empowerment legislation. As previously
announced, a first draft of the NEEEF Bill was published in
February 2016 for a period of public consultation and can be found
on the website of the Office of the Prime Minister
(www.opm.gov.na/web/opm/neee-bill). Following an extended period of
public consultation, a second draft of the NEEEF Bill is now under
further review and stakeholder consultation. The second draft of
the NEEEF Bill clarifies that the legislation would apply to both
existing and new business but otherwise remains largely unchanged
from the first draft. Indications from the Namibian Government
suggest that this proposed legislation will go ahead and be enacted
into law but timing remains uncertain. If enacted, the NEEEF Bill
will set out obligations for companies, irrespective of sector, in
respect of, inter alia, ownership and management participation by
previously disadvantaged Namibians. Certain obligations under the
draft Bill are inconsistent with those laid down under the terms
& conditions to the Notice of Preparedness to Grant. The extent
to which the NEEEF Bill would place additional obligations on the
Namib Project remains unclear. It is an area on which the Company
and Namibian mining industry as a whole will seek and need further
clarity in due course.
The Company recently announced new appointments to the Board of
Directors of wholly owned Namibian company, Namibia Lead Zinc and
Mining (Pty) Ltd ("NLZM"). The appointments of Asser Kuveri Kapere,
Ratonda Engelhardine Kajivikua and Francois du Plessis are aimed at
strengthening the Board to support the Group's efforts to obtain
the mining licence and take the Namib Project forward to a
construction decision. Mr Kapere has been appointed as Chairman of
NLZM.
North River is reporting a loss before taxation for the 6 months
to 30 June 2016 of GBP1,302,437 (30 June 2015: loss of
GBP1,377,787). The Company's cash position at the end of the period
was GBP162,026 (30 June 2015: GBP602,093), before the net US$2.5
million working capital financing was completed in July 2016.
I would like to thank our shareholders for their continued
support during what has been a difficult period for North River.
The Company now faces a critical period of assessment in
determining the way forward for the Namib Project. In regards to
this assessment we are cognisant of both the prolonged, ongoing
uncertainty regarding timing and terms to be attached to the grant
of a mining licence, and the results of the resource expansion
drilling programme.
Rod Beddows
Chairman
26 September 2016
For further information please visit www.northriverresources.com
or contact:
North River Resources Plc Tel: +44 (0) 20 7025 7047
James Beams (CEO)
Strand Hanson Limited (Nominated adviser) Tel: +44 (0) 20 7409
3494
Andrew Emmott/ Ritchie Balmer
RFC Ambrian Limited (Broker) Tel: +44 (0) 20 3440 6800
Jonathan Williams/ Kim Eckhof
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD
FROM 1 JANUARY 2016 TO 30 JUNE 2016
Unaudited Unaudited Audited
Period from Period from Year ended
1 January 1 January 31 December
CONTINUING OPERATIONS to to 2015
30 June 30 June GBP
2016 2015
GBP GBP
Exploration and evaluation expenditure (592,619) (692,150) (1,142,851)
Administrative expenses (538,604) (688,554) (1,883,600)
Impairment of goodwill (related to copper
exploration licences) - - (6,702,934)
----------------- ----------------- -----------------
GROUP OPERATING LOSS (1,131,223) (1,380,704) (9,729,385)
Interest payable on short term borrowings (174,777) (134) (82,777)
Interest receivable on bank deposits 3,563 3,051 14,471
----------------- ----------------- -----------------
LOSS BEFORE TAX (1,302,437) (1,377,787) (9,797,691)
Taxation - - -
----------------- ----------------- -----------------
LOSS FOR THE PERIOD (1,302,437) (1,377,787) (9,797,691)
OTHER COMPREHENSIVE LOSS:
Exchange difference on subsidiary loan treated
as net investment 994,806 - (2,847,677)
Exchange differences on translating foreign
operations (974,034) (8,958) 2,761,529
----------------- ----------------- -----------------
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD (1,281,665) (1,386,745) (9,883,839)
Loss per share
Basic and diluted - pence per share (0.06p) (0.07p) (0.49p)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE
2016
Unaudited Unaudited Audited
30 June 30 June 31 December 2015
2016 2015
Note GBP GBP GBP
NON-CURRENT ASSETS
Goodwill 4 1,036,052 7,738,986 1,036,052
Intangible assets 5 57,694 62,072 59,894
Plant and equipment 6 132,829 198,872 141,602
Investment in associated
company 8 113,182 113,182 113,182
-------------- -------------- ----------------------
1,339,757 8,113,112 1,350,730
-------------- -------------- ----------------------
CURRENT ASSETS
Trade and other receivables 158,519 286,779 81,925
Cash and cash equivalents 162,026 602,093 1,376,740
-------------- -------------- ----------------------
320,545 888,872 1,458,655
-------------- -------------- ----------------------
TOTAL ASSETS 1,660,302 9,001,984 2,809,395
CURRENT LIABILITIES
Trade and other payables 287,659 305,044 202,897
Convertible loan notes 7 150,238 - 150,238
-------------- -------------- ----------------------
437,897 305,044 353,135
NON-CURRENT LIABILITIES
Convertible loan notes 7 1,621,915 - 1,574,105
TOTAL LIABILITIES 2,059,812 305,044 1,927,240
-------------- -------------- ----------------------
NET (LIABILITIES) /
ASSETS (399,510) 8,696,940 882,155
============== ============== ======================
EQUITY
Share capital 9 4,398,183 3,831,750 4,398,183
Share premium 9 21,258,590 21,258,590 21,258,590
Convertible loan note
reserves 7 115,876 - 115,876
Share-based payments
reserve 11 - - -
Currency translation
reserve (211,879) (155,461) (232,651)
Retained losses (25,960,280) (16,237,939) (24,657,843)
-------------- -------------- ----------------------
TOTAL EQUITY (399,510) 8,696,940 882,155
============== ============== ======================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD FROM
1 JANUARY 2016 TO 30 JUNE 2016
Share- Convertible
based Currency loan
Share Share Retained payment translation note Total
capital premium losses reserve reserve reserve equity
GBP GBP GBP GBP GBP GBP GBP
At 1 January
2015 3,831,750 21,258,590 (14,975,797) 115,645 (146,503) - 10,083,685
Loss for the
period - - (1,377,787) - - - (1,377,787)
Other
comprehensive
income:
Currency
translation
movement - - - - (8,958) - (8,958)
---------- ----------- ------------- ---------- ------------- -------------- ------------
Total
comprehensive
loss - - (1,377,787) - (8,958) - (1,386,745)
Transactions
with
shareholders:
Transfer of
expired share
options - - 115,645 (115,645) - - -
---------- ----------- ------------- ---------- ------------- -------------- ------------
At 30 June 2015
(Unaudited) 3,831,750 21,258,590 (16,237,939) - (155,461) - 8,696,940
---------- ----------- ------------- ---------- ------------- -------------- ------------
At 01 July 2015 3,831,750 21,258,590 (16,237,939) - (155,461) - 8,696,940
Loss for the
period - - (8,419,904) - - - (8,419,904)
Other
comprehensive
income:
Currency
translation
movement - - - - (77,190) - (77,190)
---------- ----------- ------------- ---------- ------------- -------------- ------------
Total
comprehensive
loss - - (8,419,904) - (77,190) - (8,497,094)
Transactions
with
shareholders:
Shares issued 566,433 - - - - - 566,433
Convertible
loan note
equity
element - - - - - 115,876 115,876
Transfer of -
expired share
options - - - - - -
---------- ----------- ------------- ---------- ------------- -------------- ------------
At 31 December
2015 (Audited) 4,398,183 21,258,590 (24,657,843) - (232,651) 115,876 882,155
---------- ----------- ------------- ---------- ------------- -------------- ------------
At 1 January
2016 4,398,183 21,258,590 (24,657,843) - (232,651) 115,876 882,155
Loss for the
period - - (1,302,437) - - - (1,302,437)
Other
comprehensive
income:
Currency
translation
movement - - - - 20,772 - 20,772
---------- ----------- ------------- ---------- ------------- -------------- ------------
Total
comprehensive
loss - - (1,302,437) - 20,772 - (1,281,665)
At 30 June 2016
(Unaudited) 4,398,183 21,258,590 (25,960,280) - (211,879) 115,876 (399,510)
---------- ----------- ------------- ---------- ------------- -------------- ------------
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM 1 JANUARY 2016 TO 30 JUNE 2016
Unaudited Unaudited Audited
period period Year
from from to 31
1 January 1 January December
to 30 to 30 2015
June June
2016 2015
Notes GBP GBP GBP
Cash flows from
operating activities
Group operating
loss (1,131,222) (1,380,704) (9,729,385)
Adjustments for
non-cash items:
Depreciation and
amortisation charges 6 30,745 34,747 69,833
Goodwill impairment - - 6,702,934
30,745 (1,345,957) (2,956,618)
Movements in working
capital:
Increase/(decrease)
in receivables (76,594) 158,038 239,466
Increase/(decrease)
in payables 84,762 (21,911) (124,061)
------------ -------------- ------------
Net cash used
in operating activities (1,092,309) (1,209,830) (2,841,213)
------------ -------------- ------------
Investing activities
Purchase of plant
and equipment 6 (470) (94,427) (82,340)
------------ -------------- ------------
Net cash used
in investing activities (470) (94,427) (82,340)
------------ -------------- ------------
Financing activities
Proceeds from
issue of share
capital - - 566,433
Proceeds of convertible
loan notes - - 2,218,583
Repayment of loan
notes via share
issue - - (189,298)
Convertible notes
issue costs - - (171,266)
Withholding tax (13,825) - -
payments
Interest paid (113,113) (134) (63,296)
Interest received 3,563 3,051 14,471
------------ -------------- ------------
Net cash (used
in)/ from financing
activities (123,375) 2,917 2,375,627
------------ -------------- ------------
(Decrease)/increase
in cash and cash
equivalents (1,216,154) (1,301,340) (547,926)
Cash and cash
equivalents at
beginning of period 1,376,740 1,904,860 1,904,860
Exchange differences 1,440 (1,427) 19,806
------------ -------------- ------------
Cash and cash
equivalents
at end of period 162,026 602,093 1,376,740
============ ============== ============
NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL
INFORMATION FOR THE SIX MONTHSED 30 JUNE 2015
1. BASIS OF PREPARATION
These half year accounts are prepared in accordance with the
historical cost convention and in accordance with the International
Financial Reporting Standards ("IFRS"), as adopted by the European
Union, including IFRS 6 'Exploration for and Evaluation of Mineral
Resources' and IAS 34 "Interim Financial Reporting".
These half year accounts for the six months ended 30 June 2016
are unaudited and do not constitute statutory accounts as defined
in section 434 of the Companies Act 2006. They have been prepared
using accounting bases and policies consistent with those used in
the preparation of the financial statements of the Company and the
Group for the year ended 31 December 2015 and expected to be
adopted in the financial year ending 31 December 2016.
The half year accounts include unaudited comparative figures for
the half year ended 30 June 2015 and comparatives for the year
ended 31 December 2015 that have been extracted from the audited
financial statements for that year.
The financial statements for the year ended 31 December 2015
have been delivered to the Registrar of Companies and the auditor's
report on those financial statements was unqualified and did not
contain a statement made under Section 498(2) or Section 498(3) of
the Companies Act 2006. The auditors' report included an 'emphasis
of matter' in connection with the Group's going concern and licence
renewal position.
No new IFRS standards, amendments or interpretations became
effective in the six months to 30 June 2016 which had a material
effect on this consolidated interim financial information.
The Group's financial risk management objectives and policies
are consistent with those disclosed in the 2015 annual report.
Going concern
The Directors believe that the Group will be able to raise as
required, sufficient cash to enable it to continue its operations,
and continue to meet, as and when they fall due, its planned and
committed exploration and development activities and liabilities
for at least the next twelve months from the date of approval of
these condensed half year accounts. In July 2016 the group
successfully completed an additional fundraising of GBP4.2m (US
$5.6m) to fully repay $3.1 million convertible loan notes to
Greenstone Resources LP and support its on-going project
activities, see note 14 for more detail. For this reason the
Directors continue to adopt the going concern basis in preparing
the accounts.
Applications for the Namib Lead mining licence and the renewal
of several exploration EPLs in the Licence Areas have been
submitted and are awaiting confirmation. A proposal has been
submitted to the Namibian Ministry of Mines and Energy in respect
of the Namib Project, to address new licence conditions introduced
by the Ministry, this is under review by the Ministry If the mining
licence is not received or the EPLs are not renewed then the
Directors would have to reconsider the position of the Group and
the resulting ability to continue operations as planned.
2. SEGMENT REPORTING
For the purposes of segmental information, the operations of the
Group are focused in the United Kingdom, Namibia and Mozambique and
comprise one class of business: the exploration and evaluation of
mineral resources.
The Company acts as a holding company.
The Group's operating loss for the period arose from its
operations in the United Kingdom, Namibia and Mozambique. In
addition, all of the Group's assets are based in the United
Kingdom, Namibia and Mozambique.
Geographical Segment - Group Six months ended 30 June 2016
(UNAUDITED)
United Kingdom Namibia Mozambique Total
GBP GBP GBP GBP
Exploration & evaluation
expenditure - (592,619) - (592,619)
Administration expenses (417,100) (121,504) - (538,604)
Interest paid (174,777) - - (174,777)
Interest received 299 3,264 - 3,563
--------------------------------- --------- ---------- -----------
Loss before taxation (591,578) (710,859) - (1,302,437)
--------------------------------- --------- ---------- -----------
Trade and other receivables 61,812 71,593 25,114 158,519
Cash and cash equivalents 123,287 26,458 12,281 162,026
Accrued expenditure
and provisions (215,096) (72,563) - (287,659)
Convertible loan notes (150,238) - - (150,238)
Non-current convertible
loan notes (1,621,915) - - (1,621,915)
Goodwill - 1,036,052 - 1,036,052
Investment in associate
company - - 113,182 113,182
Intangible assets 1,199 - 56,495 57,694
Plant and equipment 340 132,489 - 132,829
----------- --------- ------- -----------
Net (liability) / asset (1,800,611) 1,194,029 207,072 (399,510)
=========== ========= ======= ===========
At the end of June 2016, the Group had not yet commenced
commercial production from its exploration sites and therefore had
no turnover for the period.
Geographical Segment - Group six months ended 30 June 2015
(UNAUDITED)
United Kingdom Namibia Mozambique Total
GBP GBP GBP GBP
Exploration & evaluation
expenditure - (692,150) - (692,150)
Administration expenses (615,429) (73,125) - (688,544)
Interest paid - (134) - (134)
Interest received 650 2,401 - 3,051
--------------------------------- --------- ---------- -----------
Loss before taxation (614,779) (763,008) - (1,377,787)
--------------------------------- --------- ---------- -----------
Trade and other receivables 203,715 57,950 25,114 286,779
Cash and cash equivalents 563,613 26,199 12,281 602,093
Accrued expenditure
and provisions (195,449) (109,595) - (305,044)
Goodwill - 7,738,986 - 7,738,986
Investment in associate
company - - 113,182 113,182
Intangible assets 5,577 - 56,495 62,072
Plant and equipment 975 197,897 - 198,872
--------------------------------- --------- ---------- -----------
Net assets 578,431 7,911,437 207,072 8,696,940
--------------------------------- --------- ---------- -----------
Geographical Segment - Group Year ended 31 December 2015
(AUDITED)
United Namibia Mozambique Total
Kingdom
GBP GBP GBP GBP
Other income - - - -
Exploration & evaluation
expenditure - (1,142,851) - (1,142,851)
Administration expenses (1,078,093) (805,507) - (1,883,600)
Interest paid (82,657) (120) - (82,777)
Interest received 718 13,753 - 14,471
Impairment of goodwill - (6,702,934) - (6,702,934)
------------- ------------ -------------------- ------------
Loss before taxation - (1,160,032) (8,637,659) - (9,797,691)
============= ============ ==================== ============
Trade and other receivables 28,737 28,074 25,114 81,925
Cash and cash equivalents 1,194,994 169,465 12,281 1,376,740
Accrued expenditure and
provisions (158,732) (44,165) - (202,897)
Convertible loan notes (150,238) - - (150,238)
Non-current convertible
loan notes (1,574,105) - - (1,574,105)
Goodwill - 1,036,052 - 1,036,052
Investment in associate
company - - 113,182 113,182
Intangible assets 3,399 - 56,495 59,894
Plant and equipment 563 141,039 - 141,602
------------- ------------ -------------------- ------------
Net (liability) / assets (655,382) 1,330,465 207,072 882,155
============= ============ ==================== ============
3. LOSS PER SHARE
Loss for Weighted Loss per
the period average share
from continuing number Basic
operations of shares (pence
GBP per share)
Six months ended 30 (0.06)
June 2016 (Unaudited) (1,302,437) 2,199,091,843 pence
----------------- ---------------- ------------
Six months ended 30 (0.07)
June 2015 (Unaudited) (1,377,787) 1,915,875,310 pence
----------------- ---------------- ------------
Year ended 31 December (0.49)
2015 (Audited) (9,797,691) 1,981,829,845 pence
----------------- ---------------- ------------
The diluted loss per share has been calculated using a weighted
average number of shares in issue. The conversion of share options
decreases the basic loss per share, thus being anti-dilutive and
the options must be excluded from the calculation.
4. GOODWILL
The Company acquired, on 20 November 2009, the entire issued
share capital in, and the shareholder loans to Namib Lead and Zinc
Mining (Pty) Ltd ("Namib Lead"). The consideration paid by the
Company for the Namibian entity and the shareholder loans was
satisfied by the allotment of 266,666,667 Ordinary shares of
GBP0.002 each ("Ordinary shares") at a price of 3 pence per
Ordinary share.
At the time of the acquisition the Namib Lead Licence Areas were
subject to an external review by MSA Geosciences of South Africa
whose employee, Mike Venter, acted as a Competent Person, as
disclosed in the AIM re-admission document dated 28 November
2009.
Goodwill arising on the acquisition is GBP1,036,052 and was
allocated to cash-generating units (CGUs) by reference to the
exploration areas as shown below:
Goodwill ascribed to CGUs:
GBP
Namib Lead
Namib lead-zinc mine 1,036,052
==========
Goodwill impairment review
In accordance with the Group's accounting policies, and as
required by IAS 36 'Impairment of Assets', the Directors test each
goodwill CGU for impairment annually, or sooner, where indications
exist or information comes to light that clarifies the size,
quality and economics of the licences and ore bodies held/owned by
WAGE and Namib Lead.
Namib Lead and Zinc Mining (Pty) Ltd ("NLZM")
The Namib Lead-Zinc project held by NLZM is the primary focus of
activity. To date, significant project work has been completed
resulting in the publication of a definitive feasibility study in
late 2014 showing an economically robust project. The feasibility
study and the impairment testing of the goodwill indicates a
calculated net present value of $24.7 million and an IRR of 52%. To
further enhance the value of the project, the Group has undertaken
project optimisation work and has embarked on a 3,800 metre
resource drilling campaign targeted at increasing the resource base
and mine life. As a result of the impairment tests carried out and
the resulting CGU's net present value estimated, the Directors do
not believe that the goodwill of NLZM's Namib Lead of GBP1,036,052
should be impaired.
Goodwill balances at the period end
The goodwill balances at each period end were as follows:
Unaudited Unaudited Audited
at at at
30 June 30 June 31 December
Goodwill ascribed to CGUs: 2016 2015 2015
WAGE GBP GBP GBP
Witvlei Copper - 4,719,300 -
Dordabis Copper - 1,983,634 -
---------- ------------ --------------
- 6,702,934 -
Namib Lead
Namib Lead - mine 1,036,052 1,036,052 1,036,052
Goodwill carrying values 1,036,052 7,738,986 1,036,052
========== ============ ==============
At 31 December 2015 an impairment charge of GBP6,702,934 was
made to the goodwill ascribed to West Africa Gold Exploration
(Namibia) (Pty) Ltd. This was due to the net present value of the
copper projects associated with the licenses being marginal using
long term consensus copper prices.
5. INTANGIBLE ASSETS
Exploration
licences Software Total
GBP GBP GBP
COST
At 31 December 2014
(Audited) 134,464 37,151 171,615
Effects of foreign
exchange (5,159) (1,429) (6,588)
-------------------------- -------- --------
At 30 June 2015 (Unaudited) 129,305 35,722 165,027
Effects of foreign
exchange (11,342) (3,139) (14,481)
-------------------------- -------- --------
At 31 December 2015
(Audited) 117,963 32,583 150,546
Effects of foreign
exchange 9,831 2,745 12,576
-------------------------- -------- --------
At 30 June 2016 (Unaudited) 127,794 35,328 163,122
-------------------------- -------- --------
AMORTISATION
At 31 December 2014
(Audited) 77,969 28,708 106,677
Charge for the period - 2,861 2,861
Effects of foreign
exchange (5,159) (1,424) (6,583)
-------------------------- -------- --------
At 30 June 2015 (Unaudited) 72,810 30,145 102,955
Charge for the period - 2,182 2,182
Effects of foreign
exchange (11,342) (3,143) (14,485)
-------------------------- -------- --------
At 31 December 2015
(Audited) 61,468 29,184 90,652
Charge for the period - 2,200 2,200
Effects of foreign
exchange 9,831 2,745 12,576
-------------------------- -------- --------
At 30 June 2016 (Unaudited) 71,299 34,129 105,428
-------------------------- -------- --------
NET BOOK VALUE
At 30 June 2016 (Unaudited) 56,495 1,199 57,694
-------------------------- -------- --------
At 30 June 2015 (Unaudited) 56,495 5,577 62,072
-------------------------- -------- --------
At 31 December 2015
(Audited) 56,495 3,399 59,894
-------------------------- -------- --------
6. PROPERTY, PLANT AND EQUIPMENT
Plant & Fixtures Motor vehicles
machinery & fittings GBP Total
GBP GBP GBP
COST
At 31 December 2014
(Audited) 163,452 39,483 172,724 375,659
Additions in the period 89,052 5,375 - 94,427
Effects of foreign
exchange (10,815) (1,432) (11,430) (23,677)
--------------------- ---------------- ---------------------- --------
At 30 June 2015 (Unaudited) 241,689 43,426 161,294 446,409
Additions in the period (12,890) 803 - (12,087)
Effects of foreign
exchange (23,777) (3,148) (25,125) (52,050)
--------------------- ---------------- ---------------------- --------
At 31 December 2015
(Audited) 205,022 41,081 136,169 382.272
Additions in the period - 470 - 470
Effects of foreign
exchange 33,073 3,750 21,966 58,789
--------------------- ---------------- ---------------------- --------
At 30 June 2016 (Unaudited) 238,095 45,301 158,135 441,531
--------------------- ---------------- ---------------------- --------
DEPRECIATION
At 31 December 2014
(Audited) 73,045 33,302 125,455 231,802
Charge for the period 19,362 3,113 9,411 31,886
Effects of foreign
exchange (5,997) (1,286) (8,868) (16,151)
--------------------- ---------------- ---------------------- --------
At 30 June 2015 (Unaudited) 86,410 35,129 125,998 247,537
Charge for the period 23.615 2,217 7,072 32,904
Effects of foreign
exchange (16,104) (3,435) (20,232) (39,771)
--------------------- ---------------- ---------------------- --------
At 31 December 2015
(Audited) 93,921 33,911 112,838 240,670
Charge for the period 22,219 1,493 7,033 30,745
Effects of foreign
exchange 16,060 2,736 18,491 37,287
--------------------- ---------------- ---------------------- --------
At 30 June 2016 (Unaudited) 132,200 38,140 138,362 304,691
--------------------- ---------------- ---------------------- --------
NET BOOK VALUE
--------------------- ---------------- ---------------------- --------
At 30 June 2016 (Unaudited) 105,895 7,161 19,773 132,829
--------------------- ---------------- ---------------------- --------
At 30 June 2015 (Unaudited) 155,279 8,297 35,296 198,872
--------------------- ---------------- ---------------------- --------
At 31 December 2015
(Audited) 111,101 7,170 23,331 141,602
--------------------- ---------------- ---------------------- --------
7. CONVERTIBLE LOAN NOTES
Unaudited Unaudited Audited
at at at
30 June 30 June 31 December
2016 2015 2015
GBP GBP GBP
Amounts falling
due within one
year:
Convertible loan
notes 150,238 - 150,238
---------- ---------- -------------
Amounts falling
due after more
than one year:
Convertible loan
notes 1,621,915 - 1,574,105
---------- ---------- -------------
Total 1,772,153 - 1,724,343
========== ========== =============
Greenstone Resources LP issued convertible loan notes to North
River Resources Plc as part of the contracted subscription
agreement in the Open Offer placed on the market in September
2015.
The US Dollar notes are convertible into new ordinary shares at
the Open Offer Price (0.02p per Ordinary Share). The Offer Price is
converted into US Dollars applying the Financial Times Exchange
rate on the date before the Open Offer (14 September 2015 $1:
GBP0.6489).
Transaction costs directly associated with the issue of
Convertible loan notes have been allocated to the liability and
equity components in accordance with IAS 32 'Financial Instruments:
Presentation'. They are recognised against the outstanding loan
balance and included in the discounting calculation used to
calculate the fair value of the loan notes. The loan notes are
unwound over the loan period until maturity, at this point the loan
liability will be equal to the face value notes issued in October
2015 of $3,418,355.
In July 2016 the Convertible loan notes were redeemed in full as
part of a GBP4.2m ($5.6m) fundraising completed, see note 15 for
further details.
8. INVESTMENT IN ASSOCIATED COMPANY
The following entity meets the definition of an associate and
has been equity accounted in the consolidated interim financial
information:
Company Country Group interest
of Incorporation at 30 June
2016
North River Resources
(Murrupula) Limitada Mozambique 40%
North River Resources (Murrupula) Limitada ('Murrupula') is a
company that was registered in Mozambique on 27 January 2011. The
Group's interest in Murrupula is jointly held by North River
Resources plc and NRR Mozambique Limited. It is also the beneficial
owner of an exploration licence in Mozambique. The licence and
Murrupula are the subject of a Heads of Agreement between Baobab
Resources Limited ("Baobab") and North River Resources plc. Under
this agreement Baobab is entitled to a 60% participation interest
in Murrupula. Boabab have completed the agreed level of exploration
work. Legal control over Murrupula has not yet passed to Baobab,
however, effective control has passed.
Accordingly, these consolidated financial statements have been
prepared on the basis that control has passed and that Murrupula is
treated as an associate as from 1 October 2011.
9. SHARE CAPITAL
Allotted, issued and fully paid:
Nominal Unaudited Unaudited Audited
value at at at
30 June 30 June 31 December
2016 2015 2015
GBP GBP GBP
Number of
Ordinary shares 2,199,091,843 1,915,875,310 2,199,091,843
Ordinary share 0.2p GBP4,398,183 GBP3,831,750 GBP4,398,183
capital
============== ============== ==============
Date of issue Detail of Number of Share Share
issue Ordinary capital premium
shares GBP GBP
At 1 January
2014 1,915,875,310 3,831,750 21,258,590
Open Offer
7 October 2015 and Placing 283,216,533 566,433 -
As at 31 December
2015 2,199,091,843 4,398,183 21,258,590
As at 30 June
2016 2,199,091,843 4,398,183 21,258,590
================ ============ =============
10. SUBSIDIARIES
The consolidated interim financial information includes
the following group companies:
Company Country of Holding Nature of business
Incorporation
NRR Energy Minerals Limited United Kingdom 100% Holding company
NRR Mozambique Limited United Kingdom 100% Holding company
West Africa Gold Exploration Namibia 100% Exploration
(Namibia) (Pty) Ltd and mining
Namib Lead and Zinc Mining Namibia 100% Exploration
(Pty) Ltd and mining
North River Resources Namibia Namibia 100% Administration
(Pty) Ltd
North River Resources (Mavuzi) Mozambique 100% Inactive
Limitada
NRR Energy Minerals Limited and NRR Mozambique Limited act as
holding companies to associates, joint venture companies and
subsidiaries in Namibia and Mozambique respectively.
11. SHARE BASED PAYMENTS
Share options outstanding
Unaudited Unaudited Audited
6 months 6 months Year ended
ended ended 31 Dec
30 June 30 June 2015
2016 2015
Number Number Number
Opening balance - 9,100,000 9,100,000
Expired / cancelled during
the period - (9,100,000) (9,100,000)
----------- ------------ ------------
Closing balance - - -
=========== ============ ============
There are no share options outstanding as at 30 June 2016. All
share options were fully expensed in prior periods.
12. CONTROL
No one party is identified as controlling the Group.
13. RELATED PARTY TRANSACTIONS
Convertible loan notes
During the period the Group incurred interest quarterly in
arrears on the full balance of the loan notes at an annualised rate
of 10%. A total of GBP113,113 (December 2015: GBP50,698, June 2015:
GBPnil) was paid on the issued loan notes to Greenstone Resources
LP.
Directors' remuneration
Details of the Director's remuneration for the period ending 30
June 2016 were as follows:
James Beams GBP80,000
Ken Sangster GBP12,000
Keith Marshall GBP12,000
Rod Beddows GBP24,000
Mark Thompson GBP12,000
14. EXPLORATION EXPENDITURE COMMITMENTS
Restoration commitments
The Company has no obligations to undertake any rehabilitation
or restoration activity on the licences currently held. Existing
Exploration Licences in Namibia
The Group has a number of exploration licences in Namibia. The
Group plans to carry out further exploration work on the licences,
the amount of work being dependant on success at each stage.
Estimated exploration expenditure, excluding the ongoing
expenditure on the Namib project, and based on success, could be up
to GBP0.1 million on these licences through 2016 - 2017. There is
scope in the Mines and Minerals Act for expenditure to be altered
by the Group and still keep the licences in good standing. It
should also be noted that meaningful expenditure will only commence
once outstanding licence renewals have been received, and if at any
point the results do not support further investment, the relevant
work programme will be terminated without further expenditure.
Existing Exploration Licences in Mozambique
The Group has a 40% interest in a licence in Mozambique, through
its associated company North River Resources
(Murrupula) Limitada. The cost of maintaining this licence is
not significant to the Group and will be borne by North River
Resources plc (see Note 8).
15. SUBSEQUENT EVENTS
Fundraising:
On 18 July 2016, shareholders approved a financing proposal by
the Company involving a share capital reorganization, an open offer
and placing.
The Company had secured GBP4.2m (US $5.6m) of funding through
the issue of new secured, conditionally convertible loan notes to
Greenstone Resources LP in order to fully redeem the 2015
convertible loan notes and raise $2.5 million in new working
capital. The conditional convertible loan notes were redeemable in
full for newly issued shares in the Company. The Company also
received approval from shareholders to undertake a share capital
re-organisation in order to be ab le to issue these new ordinary
shares and to undertake an open offer and a placing to redeem the
loan notes in full.
The results of the Open Offer led to an additional 258,758 new
ordinary shares being issued to Eligible Shareholders. The Company
did not raise any funds from the placing.
The Company redeemed GBP61,455 of the loan notes from amounts
raised in the open offer and converted the remaining balance of the
convertible loan notes into 17,337,471 new ordinary shares.
Following the issue of new ordinary shares to Greenstone,
Greenstone's aggregate holding in the Company stands at 19,975,501
ordinary shares, which represents 75.69 per cent of the Company's
issued share capital.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR VXLFLQKFEBBD
(END) Dow Jones Newswires
September 26, 2016 02:00 ET (06:00 GMT)
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