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Altus Strategies PLC - Audited Final Results

Mon, 30th Apr 2018 15:12

RNS Number : 6152M
Altus Strategies PLC
30 April 2018
 

Altus Strategies Plc / Index: AIM / EPIC: ALS / Sector: Mining

 

NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES NOR FOR DISSEMINATION IN THE UNITED STATES OF AMERICA

 

 

 

30 April 2018

Altus Strategies Plc

("Altus" or the "Company")

 

Audited Final Results

 

Altus Strategies Plc (AIM: ALS), the Africa focused exploration project generator, announces its final results for the year ended 31 December 2017.

 

Highlights:

·     Admission to AIM and Placing and Subscription raising £1.1m in August 2017

·     Plan of Arrangement with TSX-V listed Legend Gold completed in January 2018

·     Legend deal brings six gold projects in Mali and a JV with Resolute Mining Ltd

·     Exploration programmes in Cameroon, Liberia, Morocco, Ivory Coast, Mali and Ethiopia

·     Grant of new exploration licences in Ethiopia, Liberia, Ivory Coast and Morocco

·     Cash and marketable securities of £1,124,878 as at year end

·     Placement raising C$4.1 million (£2.3 million) completed in April 2018

·     Conditional approval received to list on the TSX-V in April 2018

 

Chairman's Statement

I am delighted to report on a transformational year for Altus Strategies plc ("Altus", "the Company" and together with its subsidiaries "the Group") in 2017, which included the Initial Public Offering ("IPO") of the Company's shares on the AIM Market of the London Stock Exchange ("AIM") in August.

 

Subsequent to our IPO we commenced a plan of arrangement to acquire Legend Gold Corporation ("Legend") listed on the Toronto Venture Exchange ("TSX-V"). The transaction was successfully completed in January 2018 and brought Altus six exceptionally well located gold exploration projects in western and southern Mali. Several of these are close to the world class Sadiola gold mine, operated by a consortium of IAMGOLD, AngloGold Ashanti and the Malian government.

 

On completion of the arrangement we were delighted to welcome to the Company, Michael Winn as a Non-Executive Director and David Miles as our Chief Financial Officer, (Legend's former CEO and CFO respectively). Also Demetrius Pohl and Ambogo Guindo joined Altus as strategic advisers.

 

During 2017, we were also delighted to welcome Robert 'Woody' Milroy to the board. He brings the firm substantial expertise in corporate governance, as well as a career's worth of experience in both operational and investment management roles in the resource sector. I also take this opportunity to thank Neil Adshead, who stepped down as a non-executive director from the board ahead of our listing on AIM. Neil made profound contributions to our strategic discussions during his tenure and we are delighted that he has elected to stay on with Altus as a strategic adviser to the board. I would also like to thank Jeffrey Karoly, who stepped down as our Chief Financial Officer upon the completion of our transaction with Legend.

 

We have set ourselves an ambitious and clear path for the years ahead. Our first objective is to secure attractive joint venture agreements with strong industry partners on our existing projects. In parallel we aim to continue to grow our portfolio of assets, through grassroots licence applications and the opportunistic acquisitions of projects and royalties. As we go forward Altus will continue to maintain the highest social and environmental standards in the regions and with the communities where we operate.

 

It has been an incredibly productive year for Altus, having achieved a number of key milestones. On behalf of the board I take this opportunity to express my congratulations to all of the Altus employees, management and stakeholders for their collective hard work and determination during the year. They have driven all of our achievements and I am immensely proud of their contribution. Also I would like to welcome all of our new shareholders, large and small, that have invested in Altus. Your board and management team are working to ensure your confidence in us and our business model proves to be well placed.

 

We look forward with excitement to the year ahead for Altus, having established a solid and highly entrepreneurial platform for value creation in 2018 and beyond.

 

 

David Netherway

Non-Executive Chairman

30 April 2018

 

 

Market Abuse Regulation Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 ("MAR") until the release of this announcement. That inside information is set out in this announcement and is now considered to be in the public domain.

 

For further information you are invited to visit the Company's website www.altus-strategies.com or contact:

 

 

 

Altus Strategies Plc

Steven Poulton, Chief Executive

 

Tel: +44 (0) 1235 511 767

E: info@altus-strategies.com

SP Angel (Nominated Adviser)

Richard Morrison / Soltan Tagiev

 

Tel: +44 (0) 20 3470 0470

SP Angel (Broker)

Elizabeth Johnson / Richard Parlons

 

Tel: +44 (0) 20 3470 0471

Blytheweigh (Financial PR)

Tim Blythe / Camilla Horsfall / Nick Elwes

Tel: +44 (0) 20 7138 3204

 

About Altus Strategies Plc

Altus is a London listed (AIM: ALS), diversified and Africa focused mineral exploration project generator. Through our subsidiaries we discover new projects and attract third party capital to fund their growth, development and ultimately exit optionality. This strategy enables Altus to remain focused on the acquisition of new opportunities to be fed into the project generation cycle and aims to minimise shareholder dilution. Our business model is designed to create a growing portfolio of well managed and high growth potential projects, diversified by commodity and by country. Altus currently has seventeen projects in six commodities across six countries. We aim to position our shareholders at the vanguard of value creation, but with significantly reduced risks traditionally associated with investments in the mineral exploration sector.

 

 Cautionary Note Regarding Forward-Looking Statements

This news release includes certain statements that may be deemed "forward looking statements" with the meaning of applicable securities laws. All statements in this news release, other than statements of historical facts, that address events or developments that Altus Strategies Plc expects to occur, are forward looking statements and involve known and unknown risks, uncertainties and other factors. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "targets" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. The Company believes the expectations, estimates, forecasts and projections expressed in such forward looking statements are based on reasonable assumptions. However, investors are cautioned that such statements are not guarantees of future performance and the Company cannot provide assurance that actual results or performance will not differ materially from those projected in the forward looking statements. Factors that could cause the actual results to differ materially from those in forward looking statements include changes in market prices, exploration results and the interpretation of other geological data, the ability of the Company to obtain, maintain, renew and/or extend required licences, permits, authorizations and/or approvals from the appropriate regulatory authorities and other risks relating to the legal and regulatory frameworks in jurisdictions where the Company operates, competitive conditions in the mineral exploration sector, the activities of artisanal miners, whose activities could delay or hinder exploration or mining operations, the risk that third parties to contracts may not perform as contracted or may breach their agreements, the ability to attract and retain key management and personnel, terrorism, civil strife, or war in the jurisdictions in which the Company operates, or in neighbouring jurisdictions which could impact on the Company's exploration, development and operating activities, unanticipated costs and expenses, the continued availability of capital and financing on acceptable terms or at all, and general economic, market or business conditions.

 

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. 

 

**ENDS**

 

 

 

INDEPENDENT AUDITOR'S REPORT

 

Opinion

We have audited the financial statements of Altus Strategies plc (the parent company) and its subsidiaries (the group) for the year ended 31 December 2017 which comprise the Group Statement of Comprehensive Income, the Group and Parent Company Statement of Financial Position, the Group and Parent Company Statement of Changes in Equity, the Group and Parent Company Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and as regards the Parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

 

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

 

In our opinion:

·      The financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2017 and of the group's and parent company's loss for the year then ended;

·      The group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;

·      The parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

·      The financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

 

Basis for opinion

 

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Conclusions relating to going concern

 

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

·      the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

·      the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

 

 

Our application of materiality

The materiality applied to the Group financial statements was £120,000, based on thresholds for net assets and the loss before tax. The performance materiality was £84,000.

 

An overview of the scope of the audit

As part of designing our audit, we determined materiality and assessed the risk of material misstatement in the financial statements. In particular, we looked at areas involving significant accounting estimates and judgement by the directors and considered future events that are inherently uncertain. We also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

 

The accounting records of the parent company and all subsidiary undertakings are centrally located and audited by us based upon Group materiality or risk to the Group.

 

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current year and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

 

We have determined the following key audit matters and set out our findings:

Key Audit Matter

How the scope of our audit responded to the key audit matter

Valuation and recoverability of exploration assets and, for the parent company, amounts due from subsidiary and related undertakings.

We reviewed the Group's exploration licences and permits to confirm good title and standing. For licences which had expired and are in the process of renewal, we assessed the relevant factors, in conjunction with discussions with management, regarding the likelihood of renewal.

 

We reviewed the terms and status of the joint venture agreements in place, in conjunction with the accounting treatment adopted under the terms of those agreements.

 

The early stage projects were reviewed for indicators of impairment in accordance with IFRS 6, in conjunction with the competent persons report prepared for the IPO Admission Document.

 

The recoverability of amounts due from subsidiary and related undertakings were assessed by reference to the underlying projects therein.

 

 

 

Other information

 

The other information comprises the information included in the Annual Report, other than the Group and Parent Company's financial statements and our auditor's report thereon. The directors are responsible for the other information. Our opinion on the Group and Parent Company financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

 

Opinions on other matters prescribed by the Companies Act 2006

 

 

In our opinion, based on the work undertaken in the course of our audit:

·      the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·      the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

 

 

 

Matters on which we are required to report by exception

 

In the light of the knowledge and understanding of the Group and Parent Company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.

 

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

 

·      adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

·      the Parent Company financial statements are not in agreement with the accounting records and returns; or

·      certain disclosures of directors' remuneration specified by law are not made; or

·      we have not received all the information and explanations we require for our audit.

 

 

 

Responsibilities of directors

 

As explained more fully in the Directors' Responsibilities Statement, the directors are responsible for the preparation of the Group and Parent Company financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

 

In preparing the Group and Parent Company financial statements, the directors are responsible for assessing the Group and Parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or Parent Company or to cease operations, or have no realistic alternative but to do so.

 

 

 

 

Auditor's responsibilities for the audit of the financial statements

 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

 

 

 

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

 

 

 

 

David Thompson (Senior Statutory Auditor)

 

for and on behalf of PKF Littlejohn LLP

 

Statutory Auditor

 

1 Westferry Circus

 

Canary Wharf

 

London

 

E14 4HD 

 

 

30 April 2018

 

 

GROUP STATEMENT OF COMPREHENSIVE INCOME

 

 

2017

 

2016

 

Notes

£

 

£

Continuing operations

 

 

 

 

 

Management fees and costs recovered from joint venture partners

4

401,228

 

455,475

Administrative expenses

6

(1,497,498)

 

(920,620)

Exploration costs expensed

7

(556,447)

 

(512,636)

IPO and acquisition related costs

 

(371,753)

 

-

 

 

 

 

Loss from operations

 

 

(2,024,470)

 

(977,781)

Investment revenues

12

61

 

165

Other operating income

 

33,588

 

7,080

Fair value gain on investments

13

129,142

 

287,639

Gain on disposal of discontinued operations

8

-

 

29,405

 

 

 

 

Loss before taxation

 

(1,861,679)

 

(653,492)

Taxation

14

(1,126)

 

(174)

 

 

 

 

Loss and total comprehensive income for the year

 

(1,862,805)

 

(653,666)

 

 

 

 

Loss for the year attributable to:

 

 

 

-       Owners of the parent company

(1,860,145)

 

(649,091)

-       Non-controlling interest

               (2,660)

 

      (4,575)

 

       (1,862,805)

 

  (653,666)

Total comprehensive income for the year attributable to:

 

 

 

-       Owners of the parent company

(1,860,145)

 

(649,091)

-       Non-controlling interest

             (2,660)

 

      (4,575)

 

     (1,862,805)

 

  (653,666)

                           

 

 

 

 

GROUP STATEMENT OF COMPREHENSIVE INCOME

Note

2017

 

2016

 

£

 

£

 

 

 

 

Earnings per share (pence) attributable to the owners of the parent

 

15

 

 

 

Continuing operations

 

(1.84)

 

(0.81)

Discontinued operations

 

-

 

0.03

 

 

(1.84)

 

(0.78)

 

_______________

 

___________________

 

 

 

           

 

GROUP STATEMENT OF FINANCIAL POSITION

 

2017

 

2016

 

 

Notes

 

£

 

£

 

Non-current assets

 

Intangible assets

16

 

151,875

 

105,640

 

Property, plant and equipment

17

 

2,386

 

2,065

 

Investments

19

 

601,536

 

472,394

 

 

 

 

 

 

 

755,797

 

580,099

 

 

Current assets

 

Trade and other receivables

21

 

110,669

 

254,479

 

Cash and cash equivalents

 

523,344

 

415,914

 

 

 

 

 

 

 

634,013

 

670,393

 

 

 

 

 

 

Total assets

 

1,389,810

 

1,250,492

 

 

 

 

 

 

 

Current liabilities

 

Trade and other payables

22

 

298,055

 

323,863

 

Current tax liabilities

 

 

-

 

4,018

 

Provisions

23

 

15,000

 

15,000

 

 

 

 

 

 

Total liabilities

313,055

 

342,881

 

 

 

 

 

 

Net current assets

 

320,958

 

327,512

 

 

 

 

 

 

Net assets

 

1,076,755

 

907,611

 

 

 

 

 

 

 

Equity

 

Share capital

29

 

1,076,808

 

104,526

 

Share premium

30

 

999,000

 

5,770,590

 

Other reserves

 

 

5,727,614

 

(92,323)

 

Retained earnings

 

 

(6,656,664)

 

(4,807,839)

 

 

 

 

 

 

 

Total equity attributable to owners of the parent

 

1,146,758

 

974,954

 

Non-controlling interest

 

    (70,003)

 

 

   (67,343)

 

Total equity

 

1,076,755

 

907,611

 

 

 

 

 

 

 

 

 

 

 

 

                       

 

The financial statements were approved by the board of directors and authorised for issue on 30 April 2018 and are signed on its behalf by:  

 

 

 

Mr R Milroy

 

Mr M Grainger

Director

 

Director

 

 

 

COMPANY STATEMENT OF FINANCIAL POSITION

 

2017

 

 

 

Notes

 

 

£

 

Non-current assets

 

 

Investments

19

 

 

965,808

 

 

 

 

 

Current assets

 

 

Trade and other receivables

21

 

 

527,913

 

Cash and cash equivalents

 

 

291,087

 

 

 

 

 

 

 

 

 

819,000

 

 

 

 

 

 

 

Total assets

 

 

1,784,808

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

22

 

 

91,662

 

 

 

 

 

 

 

Total liabilities

 

91,662

 

 

 

 

 

 

 

Net current assets

 

 

727,338

 

 

 

 

 

 

 

Net assets

 

 

1,693,146

 

 

 

 

 

Equity

 

 

Called up share capital

29

 

 

1,076,808

 

Share premium account

30

 

 

999,000

 

Retained earnings

 

 

 

(382,662)

 

 

 

 

 

 

 

 

Total equity

 

 

1,693,146

 

 

 

 

 

 

As permitted by section 408 of the Companies Act 2006, the Company has not presented its own statement of comprehensive income and relates notes. The Company's loss for the year was £382,662.

The financial statements were approved by the board of directors and authorised for issue on 30 April 2018 and are signed on its behalf by:

 

 

 

 

 

 

 

 

 

 

Mr R Milroy

 

Mr M Grainger

 

Director

 

Director

 

 

 

 

 

                   

 

 

 

 

 

 

 

 

 

 

GROUP STATEMENT OF CHANGES IN EQUITY

 

Share capital

Share premium account

Other reserves

Retained earnings

Total equity

Non-controlling interest

Total

 

 

 

Notes

 

 

£

£

£

£

£

£

£

Balance at 1 January 2016

 

116,396

5,748,597

4,279

(4,158,748)

1,710,524

(62,768)

1,647,756

 

 

 

 

 

 

 

 

 

Year ended 31 December 2016:

 

 

 

 

 

 

 

 

Loss and total comprehensive income for the year

 

-

-

-

(649,091)

(649,091)

(4,575)

(653,666)

 

 

 

 

 

 

 

 

 

Issue of share capital

29 & 30

353

21,993

-

-

22,346

-

22,346

Reduction of shares

 

(12,223)

-

-

-

(12,223)

-

(12,223)

Transfers

 

-

-

(96,602)

-

(96,602)

-

(96,602)

Total transactions with owners, recognised directly in equity

 

(11,870)

21,993

(96,602)

-

(86,479)

-

(86,479)

 

 

 

 

 

 

 

 

 

Balance at 31 December 2016

 

104,526

5,770,590

(92,323)

(4,807,839)

974,954

(67,343)

907,611

 

 

 

 

 

 

 

 

 

Year ended 31 December 2017

 

 

 

 

 

 

 

 

Loss and total comprehensive income for the year

 

-

-

-

(1,860,145)

(1,860,145)

(2,660)

(1,862,805)

 

 

 

 

 

 

 

 

 

Issue of share capital

29 & 30

127,200

1,901,106

-

-

2,028,306

-

2,028,306

Issue of warrants

 

-

-

3,643

-

3,643

-

3,643

Capital reorganisation

 

845,082

(6,672,696)

5,827,614

-

-

-

-

Share options exercised

 

-

-

(11,320)

11,320

-

-

-

Total transactions with owners, recognised directly in equity

 

972,282

(4,771,590)

5,819,937

11,320

2,031,949

-

2,031,949

 

 

 

 

 

 

 

 

 

Balance at 31 December 2017

 

 1,076,808

 999,000

 5,727,614

(6,656,664)

1,146,758 

 (70,003)

1,076,755 

 

 

 

COMPANY STATEMENT OF CHANGES IN EQUITY

 

Share capital

Share premium account

Retained earnings

Total

 

 

Notes

£

£

£

£

 

 

Year ended 31 December 2017:

 

Loss and total comprehensive income for the year

 

-

-

 

(382,662)

(382,662)

Issue of share capital

29 & 30 30

1,076,808

999,000

-

2,075,808

 

Total transactions with owners, recognised directly in equity

 

1,076,808

999,000

-

2,075,808

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 31 December 2017

 

1,076,808

999,000

 

(382,662)

1,693,146

 

 

 

 

 

 

 

 

 

 

 

                         

 

 

 

 

GROUP STATEMENT OF CASH FLOWS

2017

 

2016

 

 

Notes

£

£

£

£

 

 

 

Cash flows from operating activities

 

 

 

 

Cash generated from/ (used in) operations

36

 

(1,523,505)

 

(495,629)

 

Income taxes paid

 

 

-

 

(174)

 

 

 

 

 

 

 

 

 

Net cash outflow from operating activities

 

(1,523,505)

 

(495,803)

 

 

 

Investing activities

 

 

Purchase of intangible assets

 

(1,734)

 

(15,371)

 

 

Purchase of property, plant and equipment

 

(46,235)

 

(405)

 

 

Distribution in specie

-

 

(100,000)

 

Other investments and loans made

 

-

 

(1,092,191)

 

Proceeds from other investments and loans

-

 

1,104,480

 

Interest received

 

61

 

307

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

(47,908)

 

(103,180)

 

 

 

Financing activities

 

 

Proceeds from issue of shares

 

1,678,843

 

-

 

 

 

 

 

 

 

 

Net cash generated from financing activities

 

1,678,843

 

-

 

 

 

 

 

 

 

 

 

Net increase/(decrease) in cash and cash equivalents

 

107,430

 

(598,983)

 

 

 

Cash and cash equivalents at beginning of year

 

415,914

 

1,014,897

 

 

 

 

 

 

 

Cash and cash equivalents at end of year

 

523,344

 

415,914

 

 

 

 

 

 

 

                           

 

 

 

 

 

 

 

 

COMPANY STATEMENT OF CASH FLOWS

 

2017

 

 

Notes

£

£

 

 

Cash flows from operating activities

 

 

Cash used in operations

37

 

(818,913)

 

 

 

 

Net cash used in operating activities

 

(818,913)

 

Financing activities

 

Proceeds from issue of shares

 

1,110,000

 

 

 

 

 

Net cash generated from financing activities

 

1,110,000

 

 

 

 

 

Net increase in cash and cash equivalents

 

291,087

 

 

Cash and cash equivalents at beginning of year

 

-

 

 

 

 

Cash and cash equivalents at end of year

 

291,087

 

 

 

 

Non-cash transactions

During the year the Company issued 96,580,812 ordinary shares to acquire Altus Exploration Management Limited by way of a share for share exchange.

 

               

                                 

 

 

1

Accounting policies

 

 

Company information

 

Altus Strategies plc is a public company limited by shares incorporated in England and Wales. The registered office is 14 Station Road, Didcot, Oxfordshire, OX11 7LL.

 

The Group consists of Altus Strategies plc and all of its subsidiaries, as listed in note 20.

 

1.1

Basis of preparation

 

These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS interpretations committee (IFRS IC) interpretations as adopted for use in the European Union and with IFRS and their interpretations issued by the IASB. The consolidated financial statements have also been prepared in accordance with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, (except as otherwise stated).

 

 

The financial statements have been prepared on the historical cost basis, except for the valuation of investments at fair value through profit or loss. The principal accounting policies adopted are set out below.

 

 

 

The financial statements are prepared in British Pounds Sterling (£), which is the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest whole pound.

 

As permitted by section 408 of the Companies Act 2006, the Company has not presented its own statement of comprehensive income and relates notes. The Company's loss for the year was £382,662.

 

1.2

Basis of consolidation

The consolidated financial statements comprise the financial statements of Altus Strategies plc and its subsidiaries as at 31 December 2017.

 

Altus Strategies plc was incorporated on 28 April 2017. On 14 June 2017, Altus Strategies plc acquired the entire share capital of Altus Exploration Management Limited by way of a share for share exchange. The transaction has been treated as a group reconstruction and has been accounted for using the reverse merger accounting method. Accordingly, the financial information for the current year and comparatives have been presented as if Altus Exploration Management Limited has been owned by Altus Strategies plc throughout the current and prior years.

 

Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls and investee if, and only if, the Group has:

 

·     power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)

·     Exposure, or rights, to variable returns from its involvement with the investee

·     The ability to use its power over the investee to affect its future

 

1

Accounting policies                                                                                                                                           (continued)

 

Generally, there is a presumption that a majority of the voting rights results in control. To support this presumption and when the Group has less than a majority of the voting rights or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has the power over an investee, including:

 

·     The contractual arrangements with the other vote holders of the investee

·     Rights arising from other contractual arrangements

·     The Group's voting rights and potential voting rights

 

The Group re-assesses 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. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.

 

"Joint ventures" as referred to in the financial statements refer to agreements with exploration partners and not joint ventures as defined within IFRS 11.

 

Profit or loss and each component of other comprehensive income are attributed to the equity holders of the parent company of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance.

 

All inter- group assets and liabilities, equity income, expense and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

 

1.3

Going concern

 

The Directors have at the time of approving the financial statements, a reasonable expectation that the Group and Company have adequate resources to continue in operational existence for the foreseeable future. In common with many junior resource investment and exploration companies, the Group and Company raise funds in discrete tranches from existing shareholders and /or new investors. The Directors and management are using funds for the evaluation of resource investment and exploration opportunities. The current funds are forecast to provide sufficient working capital through the next financial year and additional funds will be raised as and when required. Thus, they continue to adopt the going concern basis of accounting in preparing the financial statements.

 

 

1

Accounting policies                                                                                                                                           (continued)

1.4

Segmental reporting

 

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, which is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.

 

1.5

Exceptional items

 

Exceptional items are disclosed separately in the financial statements where it is necessary to do so, to provide further understanding of the financial performance of the Group. They are material items of income of expense that have been shown separately due to the significance of their nature or amount. IPO and acquisition related costs are included as exceptional items in profit or loss.

 

 

 

 

 

1.6

Fair value measurement

 

IFRS 13 establishes a single source of guidance for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The resulting calculations under IFRS 13 affected the principles that the Group uses to assess the fair value, but the assessment of fair value under IFRS 13 has not materially changed the fair values recognised or disclosed. IFRS 13 mainly impacts the disclosures of the Company. It requires specific disclosures about fair value measurements and disclosures of fair values, some of which replace existing disclosure requirements in other standards.

 

 

 

 

 

 

 

 

1.7

Intangible assets - Deferred exploration costs

 

 

 

Expenditure on exploration activities is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

 

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following basis.

 

Deferred exploration costs:   Not amortised

 

Deferred exploration costs comprise of exploration licence fees capitalised in accordance with IFRS 6 "Exploration for and Evaluation of Mineral Resources."  Licences are initially measured at cost. At each reporting date, the Group reviews the carrying amount in line with the accounting policy for impairment. When a project is considered no longer viable, the associated licence cost is written off to the income statement.

 

 

 

1

Accounting policies                                                                                                                                      (continued)

 

 

1.8

Property, plant and equipment

 

 

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

 

 

 

 

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

 

 

 

 

Fixtures and fittings

4 years straight line

 

Computers

2 years straight line

 

Plant and Machinery

4 years straight line

 

Motor vehicles

2 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 recognised in profit or loss.

 

 

 

1.9

Non-current investments

 

 

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

 

 

 

1.10

Impairment of non-current assets

 

 

At each reporting end date, the Group reviews the carrying amounts of its non-current assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

 

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

 

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

 

 

         

 

 

 

1

Accounting policies                                                                                                                                         (continued)

 

 

 

 

1.11

Cash and cash equivalents

 

 

Cash and cash equivalents include cash in hand and deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

 

 

1.12

Financial assets

 

 

Financial assets are recognised in the statement of financial position when the Group or Company becomes party to the contractual provisions of the instrument.

 

Financial assets are classified into specified categories. The classification depends on the nature and purpose of the financial assets and is determined at the time of recognition.

 

Financial assets are initially measured at fair value plus transaction costs, other than those classified as fair value through profit and loss, which are measured at fair value. Assets in this category are classified as current assets if expected to be settled within 12 months, otherwise they are classified as non-current.

 

 

 

Loans and receivables

 

 

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment. The Group's and Company's loans and receivables comprise trade and other receivables and cash and cash equivalents.

 

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.

 

 

 

Impairment of financial assets

 

 

Financial assets, other than those at fair value through profit or loss, are assessed for indicators of impairment at each reporting end date. For loans and receivables, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected.

 

 

 

Derecognition of financial assets

 

 

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

 

 

       

 

1

Accounting policies                                                                                                                                        (continued)

 

 

1.13

Financial liabilities

 

Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.

 

 

 

Other financial liabilities

 

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

 

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability to the net carrying amount on initial recognition.

 

 

 

Derecognition of financial liabilities

 

Financial liabilities are derecognised when, and only when, the company's obligations are discharged, cancelled, or they expire.

 

 

1.14

Equity instruments

 

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs.

 

1.15

Taxation

 

The tax expense represents the sum of the tax currently payable and deferred tax.

 

 

 

 

Current tax

Current tax is based on taxable profit or loss for the year. Taxable profit or loss differs from net profit or loss as reported in the Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. Current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

 

Deferred tax

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 profit or loss, and is accounted for using the balance sheet liability method. 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 profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

 

 

1

Accounting policies                                                                                                                                         (continued)

 

1.16

Provisions

 

Provisions are recognised when the Group or Company has a legal or constructive present obligation as a result of a past event and it is probable that the group will be required to settle that obligation, and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation.

 

Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

 

 

 

1.17

Employee benefits

 

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of inventories or non-current assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.

 

Termination benefits are recognised immediately as an expense when the Group is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

 

 

1.18

Retirement benefits

 

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

 

 

 

1.19

Share-based payments

 

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

 

 

 

 

When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.

 

Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

 

 

 

1

Accounting policies                                                                                                                                         (continued)

 

1.20

Leases

 

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Rentals payable under operating leases, less any lease incentives received, are charged to income on a straight-line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.

 

 

1.21

Foreign exchange

 

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the Statement of Comprehensive Income for the period.

 

 

1.22

Liquidity risk

 

 

The company seeks to manage financial risk to ensure sufficient liquidity is available to meet foreseeable needs and invest cash assets safely and profitable.

 

 

2

Adoption of new and revised standards and changes in accounting policies

 

 

 

Standards which are in issue but not yet effective

 

 

At the date of authorisation of these financial statements, the following Standards and Interpretations, which have not yet been applied in these financial statements, were in issue but not yet effective.

 

 

New and amended standards adopted by the company

There are no IFRSs or IFRIC interpretations that were effective for the first time for the financial year beginning 1 January 2017 that had a material impact on the Group or Company.

 

New and revised IFRSs in issue but not yet effective

The Group and Company have not applied the following new and revised Standards and Interpretations that have been issued but are not yet effective:

 

 

Effective date for annual

 periods beginning

on or after

·     IFRS 9 Financial Instruments

1 January 2018

·     IFRS 15 Revenue from Contracts with Customers

1 January 2018

·     IFRS 16 Leases

1 January 2019

·     IFRS 2 (Amendments) Share-based payments - classification and measurement

1 January 2018

·     IFRS 10 and IAS 28 (Amendments) Sale or Contribution of Assets between

·     an Investor and its Associate or Joint Venture

*1 January 2018

·     IAS 40 (Amendments) Transfer of Investment Property

1 January 2018

·     IFRIC Interpretation 22 Foreign currency transactions and advanced consideration

1 January 2018

·     IFRIC 23 Uncertainty over Income Tax Treatments

*1 January 2019

·     IAS 28 (Amendments) Long-term interests in Associates and Joint Ventures

*1 January 2019

·     Annual Improvements to IFRS Standards 2015-2017 Cycle

*1 January 2019

 

* Subject to EU endorsement

 

The Group is evaluating the impact of the new and amended standards above. The directors believe that these new and amended standards are not expected to have a material impact on the company's results or shareholders' funds. There is not expected to be any significant impact form the introductions of IFRS 15 as the Group does not have any revenue from contracts with customers.

 

 

Based on an analysis of the Group's financial assets and financial liabilities as at 31 December 2017 on the basis of the facts and circumstances that exist at that date, the Directors of the Company do not expect there to be a significant impact on the adoption of IFRS 9.

 

 

 

3

Critical accounting estimates and judgements

 

 

 

 

 

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are shown below.

 

Share based payments

Estimating fair value for share based payment transactions require determination of the most appropriate valuation model, which depends on the terms and conditions of the grant. The estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option or appreciation right, volatility and dividend yield and making assumptions about them. For measurement of the fair value of equity settles transactions with employees at the grant date, the Company used the Black Scholes model. The assumptions and model for estimating fair value for share based payments are disclosed in note 27.

 

Impairment of Deferred Exploration Costs

At the reporting date, deferred exploration costs had a carrying value of £151,875 (2016 - £105,640). Management tests annually whether deferred exploration costs have a carrying value in accordance with the accounting policy stated in note 1.7 each exploration cost us subject to an annual review either by a consultant or a senior geologist to determine if the exploration results have returned to date, warrant further exploration expenditure and have the potential to result in an economic discovery. This review takes in to consideration long term metal prices, anticipated resource volumes and grades, permitting and infrastructure as well as the likelihood of on-going funding from joint venture partners. In the event that a project does not represent an economic exploration target and results indicate that there is no additional upside, or that future funding from joint venture partners is unlikely, a decision will be made to discontinue exploration. The Directors have reviewed the estimated value of each project prepared by management and do not consider any impairment necessary.

 

 

 

 

4

Segmental Analysis

 

 

 

 

 

2017

2016

 

 

 

£

£

 

 

 

 

 

 

 

Management fees and costs recovered from joint venture partners

  401,228

    455,475

 

 

 

 

 

 

 

Other operating income

33,588

-

 

 

Interest income

            61

            165

 

 

 

    33,649

            165

 

 

 

 

 

 

 

 

Segmental analysis

UK

Africa

Total

 

 

 

2016

2016

2016

 

 

 

£

£

£

 

 

Management fees and costs recovered from joint venture partners

4,943

450,587

455,530

 

 

Loss from operations

(890,575)

(87,206)

(977,781)

 

 

 

 

 

 

 

 

Reportable segment assets

1,059,433

191,059

1,250,492

 

 

Reportable segment liabilities

298,106

44,775

342,881

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

UK

Africa

Total

 

 

 

2017

2017

2017

 

 

 

£

£

£

 

 

Management fees and costs recovered from joint venture partners

-

401,228

401,228

 

 

Loss from operations

(1,829,925)

(194,545)

(2,024,470)

 

 

 

 

 

 

 

 

Reportable segment assets

1,075,825

313,985

1,389,810

 

 

Reportable segment liabilities

(241,062)

(71,993)

(313,055)

 

 

 

 

 

 

 

5

Operating loss

 

 

 

 

 

 

 

2017

2016

 

 

 

 

£

£

 

 

Operating loss for the year is stated after charging/(crediting):

 

 

 

 

Exchange losses/(gains)

 

(14,318)

(38,605)

 

 

Exploration and development costs

 

556,447

512,636

 

 

IPO and acquisition related costs

 

371,753

-

 

 

Depreciation

 

1,413

2,375

 

 

Share-based payments

 

3,643

3,398

 

 

Operating lease charges

 

350,846

23,046

 

 

 

 

 

 

 

                         

 

6

Administrative expenses

 

 

 

 

 

 

 

2017

2016

 

 

 

£

£

 

Administrative expenses include the following balances

 

 

 

 

 

 

 

Employee costs (note 10)

 

1,091,773

699,477

 

Costs incurred on behalf of joint venture partners

195,196

115,958

 

Legal and professional expenses

 

140,045

46,122

 

Travel expenses

 

29,079

20,342

 

Exchange gains

 

(14,318)

(38,605)

 

Depreciation of property, plant and equipment

1,413

2,375

 

Other expenses

 

           54,310

     74,951

 

 

 

     1,497,498

   920,620

             

 

 

 

 

 

 

 

7

Exploration and development costs

 

 

 

 

 

 

 

Location and licence

Administrative expenses

Operational expenses

Travel expenses

Total

 

 

2017

2017

2017

2017

 

 

£

£

£

£

 

Morocco - Agdz

447

7,975

6,615

15,037

 

Morocco - Takzim

457

571

38

1,066

 

Morocco - General

77,262

10,524

3,899

91,685

 

Ethiopia - Tigray-Afar

24,281

44,508

16,379

85,168

 

Ethiopia - General

79,788

4,405

7,345

91,538

 

Cameroon - Laboum

63,390

47,803

33,151

144,344

 

Cameroon - Birsok & Mandoum

1,032

189

-

1,221

 

Cameroon - Bikoula & Ndjele

1,715

3,162

1,692

6,569

 

Cameroon - General

68,989

(345)

970

69,614

 

Liberia - Bella Yella

9,418

4,575

24

14,017

 

Liberia - Zolowo

23,564

-

-

23,564

 

Liberia - Other

153

-

-

153

 

Other

      4,275

     4,479

      3,717

     12,471

 

Total

  354,771

127,846

    73,830

  556,447

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7

Exploration and development costs

 

 

(continued)

 

 

 

 

 

 

 

 

 

Location and licence

Administrative expenses

Operational expenses

Travel expenses

Total

 

 

 

2016

2016

2016

2016

 

 

 

£

£

£

£

 

 

Morocco - Agdz

52,448

9,703

9,265

71,416

 

 

Morocco - Takzim

36

2,610

867

3,513

 

 

Morocco - General

2,813

9,484

2,610

14,907

 

 

Ethiopia - Tigray-Afar

44,578

70,053

16,477

131,108

 

 

Ethiopia - General

65,274

2,441

4,865

72,580

 

 

Cameroon - Laboum

26,172

44,815

24,333

95,320

 

 

Cameroon - Birsok & Mandoum

5,176

1,170

1,652

7,998

 

 

Cameroon - Bikoula & Ndjele

7,336

4,114

2,306

13,756

 

 

Cameroon - General

86,083

619

2,675

89,377

 

 

Liberia - Bella Yella

8,810

1,005

1,179

10,994

 

 

Liberia - Zolowo

-

-

-

-

 

 

Liberia - Other

138

789

740

1,667

 

 

Other

              -

              -

              -

              -

 

 

Total

 298,864

 146,803

  66,969

 512,636

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

 

Discontinued operations

 

 

 

 

 

 

 

 

 

 

2016

 

 

Revenue

 

 

 

              55

 

 

Gross profit

 

 

 

55

 

 

Other operating income

 

 

 

600

 

 

Administrative expenses

 

 

 

      (2,578)

 

 

Operating loss

 

 

 

(1,923)

 

 

Investment revenues

 

 

 

142

 

 

Other gains and losses

 

 

 

6,594

 

 

Profit/(loss) on disposal of operations:

 

 

 

 

 

 

-       Gain on disposal of discontinued operations

-      

 

 

 

     24,592

 

 

Profit before taxation

 

 

 

29,405

 

 

Taxation

 

 

 

-

 

 

Total comprehensive income for the year

 

 

 

     29,405

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

Discontinued operations

 

 

(continued)

 

 

 

 

 

 

 

 

 

In the year ended 31 December 2016, the group disposed of four of its subsidiaries by way of a distribution in specie. The purpose of the distribution was for the group to focus on developing its mineral exploration business. The subsidiaries whose activities were divested were that of FCA regulated fund management, consultancy services and turn around investment opportunities. The distribution in specie allowed for two distinct areas of activity to be segregated whilst allowing the existing shareholders to retain full and pro rata ownership of the divested subsidiaries.

 

Upon distribution, net assets of the subsidiaries disposed amounted to £75,408. The distribution made amounted to £100,000 resulting in a profit to the group of £24,592. A merger reserve equal to the value of the distribution was created upon disposal.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                   

 

9

Auditor's remuneration

 

 

 

 

2017

2016

 

Fees payable to the company's auditor and associates:

£

£

 

 

 

 

 

For audit services

 

 

 

Audit of the financial statements of the group and company

         20,500

        8,000

 

 

         20,500

        8,000

 

10

Employees

 

 

 

 

 

 

 

 

 

 

                              Group

              Company

 

 

 

2017

2016

2017

2016

 

 

Number

Number

Number

Number

 

Directors

4

4

-

-

 

Employee

                 20

               24

                  -

                  -

 

 

                 24

                28

                  -

                  -

 

 

 

 

 

 

 

The remuneration comprised:

 

 

 

 

 

                Group

       Company

 

 

2017

2016

2017

2016

 

 

£

£

£

£

 

Wages and salaries

924,005

521,356

-

-

 

Social security costs

94,617

50,664

-

-

 

Pension costs

        73,151

       127,457

                  -

                  -

 

 

    1,091,773

       699,477

                  -

                  -

 

 

 

 

 

 

                   

 

 

 

11

Directors remuneration

 

 

 

 

 

 

 

 

2017

2016

 

 

 

 

£

£

 

Remuneration for qualifying services

 

 

315,444

229,400

 

Company pension contributions to defined contribution schemes

      49,138

      58,562

 

 

 

 

 

 

 

 

 

 

    364,582

   287,962

 

 

 

 

 

 

 

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2016 - 2)

 

 

 

 

 

 

Remuneration disclosed above includes the following amounts paid to the highest paid director:

 

 

 

 

 

 

2017

2016

 

 

 

 

 

 

 

£

£

 

Remuneration for qualifying services

 

 

201,523

90,000

 

Company pension contributions to defined contribution schemes

      44,669

 

      29,281

 

 

 

 

   246,192

   119,281

                 

 

 

Directors' Fees

Bonuses

Company pension contributions

Other employment benefits

Total

 

For the year ended 31 Dec 2017

For the year ended 31 Dec 2016

For the year ended 31 Dec 2017

For the year ended 31 Dec 2016

For the year ended 31 Dec 2017

For the year ended 31 Dec 2016

For the year ended 31 Dec 2017

For the year ended 31 Dec 2016

For the year ended 31 Dec 2017

For the year ended 31 Dec 2016

£

£

£

£

£

£

£

£

£

£

David Netherway

               12,500

            50,000

                         -  

                         -  

                         -  

                         -  

                         -  

                         -  

            12,500

            50,000

Steven Poulton

               56,500

            90,000

            31,379

                         -  

               4,469

               29,281

                         -  

                         -  

         92,348

            119,281

Matthew Grainger

               72,583

            89,400

         128,940

 

               44,669

               29,281

                         -  

                         -  

         246,192

            118,681

Robert Milroy

               13,542

                         -  

                         -  

                         -  

                         -  

                         -  

                         -  

                         -  

            13,542

                         -  

Totals

       155,125

         229,400

         160,319

                         -  

            49,138

            58,562

                         -  

                         -  

         364,582

         287,962

 

 

 

 

 

 

 

 

12

Investment income

 

 

 

 

 

 

 

 

 

2017

2016

 

 

 

 

 

£

£

 

 

Interest income

 

 

 

 

 

 

Interest on bank deposits

 

 

                 61

      165

 

 

 

 

 

 

 

 

 

13

Other gains and losses

 

 

 

 

 

 

2017

2016

 

 

£

£

 

Other gains/(losses)

 

 

 

Gains/(losses) on disposal of financial assets held at fair value through profit and loss

129,142

287,639

 

 

 

 

14

Income tax expense

 

 

 

 

2017

2016

 

 

£

£

 

Foreign current tax on profit for the current year

1,126

 

 

 

174

 

 

 

 

 

The tax on the Group's profit before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the consolidated entities as follows:

 

 

2017

2016

 

 

£

£

 

Loss before taxation

(1,861,679)

(678,084)

 

 

 

 

 

Expected tax charge based on the standard rate of corporation tax in the UK of 19.25% (2016 - 20.00%)

 

(358,373)

 

(135,617)

 

Tax effect of expenses that are not deductible in determining taxable profit

104,823

(22,753)

 

Tax effect of utilisation of tax losses not previously recognised

-

(3,874)

 

Unutilised tax losses carried forward

253,216

87,823

 

Utilised tax losses brought forward

243

 

 

Adjustments in respect of prior years

-

4,098

 

Permanent capital allowances in excess of depreciation

91

49

 

Effect of overseas tax rates

1,126

65,530

 

Gain on demerger

                  -

          4,918

 

Tax expense for the year

         1,126

             174

 

 

 

 

                 
 

 

15

Earnings per share

 

 

 

 

2017

2016

 

 

Number

Number

 

 

 

 

 

Weighted average number of ordinary shares for basic earnings per share

100,929,581

83,609,646

 

 

 

 

 

 

100,929,581

83,609,646

 

 

 

 

 

Earnings

£

£

 

Continuing operations

 

 

 

Loss for the year from continuing operations

(1,862,805)

(687,646)

 

Less non-controlling interests

2,660

4,575

 

 

 

 

 

Earnings for basic and diluted earnings per share being net loss attributable to equity shareholders

 

(1,860,145)

 

(683,071)

 

 

 

 

 

 

 

 

 

 

Discontinued operations

 

 

 

Earning for basic and diluted earnings per share being net profit attributable to equity shareholders of Altus Exploration Management Limited for discontinued operations

-

 

 

29,405

 

 

 

 

 

Basic earnings per share

 

 

 

From continuing operations

(1.84)

(0.81)

 

From discontinued operations

-

0.03

 

 

 

 

 

 

            (1.84)

            (0.78)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16

Intangible fixed assets

 

 

 

 

 

Group

 

Deferred exploration costs

Total

 

 

 

£

£

 

Cost

 

 

 

 

At 1 January 2017

 

105,640

105,640

 

Additions

 

46,235

46,235

 

Disposals

 

                    -

                    -

 

At 31 December 2017

 

       151,875

       151,875

 

 

 

 

 

 

Amortisation and impairment

 

 

 

 

At 1 January 2017

 

-

-

 

Disposals

 

                    -

                    -

 

At 31 December 2017

 

                    -

                    -

 

 

 

 

 

 

 

 

 

 

 

Carrying amount

 

 

 

 

At 31 December 2016

 

       105,640

       105,640

 

 

 

 

 

 

At 31 December 2017

 

       151,875

       151,875

 

 

 

 

 

             

 

17

Property, plant and equipment

 

 

 

 

 

 

 

 

 

Group

Plant and machinery

 

Fixtures, fittings and equipment

 

Computer equipment

Motor vehicles

Total

 

 

£

£

£

£

£

 

Cost

 

 

 

 

 

 

At 1 January 2017

240

3,832

21,405

23,140

48,617

 

Additions

-

527

1,207

-

1,734

 

Disposals

                    -

                    -

                    -

                   -

                 -

 

At 31 December 2017

               240

            4,359

           22,612

       23,140

    50,351

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortisation and impairment

 

 

 

 

 

 

At 1 January 2017

240

2,497

20,675

23,140

46,552

 

Depreciation charged in the year

-

525

888

-

1,413

 

Eliminated on disposals

                    -

                    -

                    -

                  -

               -

 

At 31 December 2017

               240

           3,022

           21,563

       23,140

    47,965

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Carrying amount

 

 

 

 

 

 

At 31 December 2016

                    -

            1,335

                730

                  -

      2,065

 

 

 

 

 

 

 

 

At 31 December 2017

                    -

            1,337

             1,049

                  -

      2,386

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                         

 

 

18

Financial instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial instruments of the Group and Company are as follows:

 

 

 

 

 

 

 

 

Group

 

 

 

 

 

 

2017

 

Financial instruments at FVTPL

Loans and receivables

Investments held at cost less accumulated impairment

Liabilities measured at amortised cost

 

 

 

£

£

£

£

 

 

 

 

 

 

 

 

Non-current assets

 

601,536

-

-

-

 

Cash and cash equivalents

 

-

523,342

-

-

 

Trade and other receivables

 

-

32,519

-

-

 

Other creditors

 

                    -

                  -

                 -

     298,055

 

 

 

       601,536

     555,861

                 -

     298,055

 

 

 

 

 

 

 

 

2016

 

Financial instruments at FVTPL

Loans and receivables

Investments held at cost less accumulated impairment

Liabilities measured at amortised cost

 

 

 

£

£

£

£

 

 

 

 

 

 

 

 

Non-current assets

 

472,394

-

-

-

 

Cash and cash equivalents

 

-

415,914

-

-

 

Trade and other receivables

 

-

193,977

-

-

 

Other creditors

 

                    -

                  -

                  -

      298,055

 

 

 

       472,394

     609,891

                  -

      298,055

 

 

 

 

 

 

 

 

Company

 

 

 

 

 

 

2017

 

Financial instruments at FVTPL

Loans and receivables

Investments held at cost less accumulated impairment

Liabilities measured at amortised cost

 

 

 

£

£

£

£

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

-

-

965,808

-

 

Cash and cash equivalents

 

-

291,087

-

-

 

Trade and other receivables

 

-

510,723

-

-

 

Other creditors

 

                  -

                  -

                  -

      91,661

 

 

 

                  -

     801,810

    965,808

      91,661

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18

Financial instruments

 

 

 

(continued)

 

 

 

 

 

 

 

 

2016

 

Financial instruments at FVTPL

Loans and receivables

Investments held at cost less accumulated impairment

Liabilities measured at amortised cost

 

 

 

£

£

£

£

 

 

 

 

 

 

 

 

Non-current assets

 

-

-

-

-

 

Cash and cash equivalents

 

-

-

-

-

 

Trade and other receivables

 

-

-

-

-

 

Other creditors

 

                -

                -

                -

               -

 

 

 

                -

                -

                -

               -

 

 

 

 

 

 

 

 

Investments in subsidiaries are held at cost less accumulated impairment as fair value cannot be reliably determined.

 

The Group uses the following hierarchy for determining and disclosing the fair value of the financial instruments by valuation technique:

 

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

 

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

 

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

 

The Group has classified its financial instruments using these categories as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Group

 

 

 

2017

2016

 

 

 

 

 

Level 1 inputs

Level 1 inputs

 

 

 

 

 

£

£

 

 

 

 

 

 

 

 

Non-current assets

 

 

 

       601,536

      472,392

 

 

 

 

 

 

 

 

There were no transfers between levels in the year.

 

 

 

 

 

 

 

 

 

 

The Company does not hold any financial instruments measured using the fair value hierarchy.

 

19

Non-current assets

 

 

 

 

 

 

Group

Company

 

 

2017

2016

2017

2016

 

 

£

£

£

£

 

Investments in subsidiaries

-

-

965,808

-

 

Investments carried at fair value

            601,536

             472,394

                     -

                 -

 

 

            601,536

             472,394

        965,808

                 -

 

 

19

Non-current assets

 

 

 

(continued)

 

 

 

 

 

 

 

 

Fair value of financial assets carried at amortised cost

Except as detailed below the directors believe that the carrying amounts of financial assets carried at amortised cost in the financial statements approximate to their fair values.

Financial assets for which fair value cannot be measured reliably

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses, in line with the accounting policy. Subsidiaries are not held at fair value as there is no active market.

Fair value of listed equity shares

Investments carried at fair value comprise listed equity shares (Level 1). The fair value of these equity shares is determined by reference to published price quotations in an active market.

 

 

20

Subsidiaries

 

 

 

 

 

Details of the Company's subsidiaries at 31 December 2017 are as follows:

 

 

 

 

 

 

Name of undertaking

Country of incorporation

Ownership interest (%)

Voting power held (%)

Nature of business

 

 

Altus Exploration Management Limited

UK

100.00

100.00

Service provider and resource investment adviser

 

 

Aeos Gold Limited

UK

100.00

100.00

Gold exploration

 

 

Auramin Limited

UK

99.00

99.00

Gold exploration

 

 

Aluvance Limited

UK

97.26

97.26

Iron ore exploration

 

 

Alures Mining Limited

UK

100.00

100.00

Bauxite exploration

 

 

Altau Resources Limited

UK

100.00

100.00

Copper exploration

 

 

Aterian Resources Limited

UK

100.00

100.00

Mineral exploration

 

 

Oxford Mining Club Limited

UK

50.00

50.00

Events

 

 

Altau Resources Limited

Ethiopia

100.00

100.00

Copper exploration

 

 

Aeos Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Altaucam Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Altau Holdings Limited

Seychelles

100.00

100.00

Dormant

 

 

Avance African Group Limited

Seychelles

100.00

100.00

Dormant

 

 

Aucam Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Inland Exploration Limited

Seychelles

100.00

100.00

Dormant

 

 

Westcoast Exploration Limited

Seychelles

100.00

100.00

Dormant

 

 

Mansion Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Altar Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Eagle Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Enigma Resources Limited

Seychelles

100.00

100.00

Dormant

 

 

Atlas Minerals

Seychelles

100.00

100.00

Dormant

 

 

Atlantic Minerals

Seychelles

100.00

100.00

Dormant

 

 

Alboran Minerals

Seychelles

100.00

100.00

Dormant

 

 

Addax Minerals

Seychelles

100.00

100.00

Dormant

 

 

Akkari Minerals

Seychelles

100.00

100.00

Dormant

 

 

Aures Minerals

Seychelles

100.00

100.00

Dormant

 

 

                     

 

 

20

Subsidiaries

 

 

 

(continued)

 

 

 

 

 

 

 

Azilal Minerals

Seychelles

100.00

100.00

Dormant

 

Altus Diamonds

Seychelles

100.00

100.00

Dormant

 

Avanor SARL

Côte d'Ivoire

97.26

97.26

Dormant

 

Avanex SARL

Côte d'Ivoire

97.26

97.26

Dormant

 

Bauxex SA

Cameroon

97.26

97.26

Dormant

 

Aucam SA

Cameroon

97.26

97.26

Iron ore exploration

 

Valnord SA

Cameroon

100.00

100.00

Gold exploration

 

Mining & Exploration Services Limited

Liberia

100.00

100.00

Gold exploration

 

AF Resources SARL AU

Morocco

100.00

100.00

Dormant

 

Azru Resources SARL AU

Morocco

100.00

100.00

Copper exploration

 

Adrar Resources SARL AU

Morocco

100.00

100.00

Dormant

 

Altus Mining (SL)

Sierra Leone

100.00

100.00

Dormant

 

AuCrest Sarl

Côte d'Ivoire

100.00

100.00

Gold exploration

 

Apalex Sarl

Côte d'Ivoire

100.00

100.00

Dormant

 

Aza Minerals Sarl

Morocco

100.00

100.00

Dormant

 

Akassori

Chad

100.00

100.00

Dormant

 

 

 

 

 

 

 

On 14 June 2017, the Company undertook capital reorganisation by way of a share for share exchange with the shareholders of Altus Strategies Limited. Subsequent to the exchange Altus Strategies Limited became a 100% subsidiary of the Company and was renamed Altus Exploration Management Limited.

 

Investments in subsidiaries are stated at cost. The future value of the investments in subsidiaries is                   dependent on future exploration and commercial success.

 

 

 

 

Registered office addresses

 

14 Station Road, Didcot, Oxfordshire OX11 7LL, United Kingdom

 

Bole Sub-City, Kebele  08/09, House No. 811/A, P.O.Box 2633, Addis Ababa, Ethiopia

 

 

Suite 24, First Floor, Eden Plaza, Eden Island, Victoria, PO Box 438, Mahé, Seychelles

 

 

Cocody Les Deux Plateux, Rue des Jardins, Residence Aziz, Porte B, 20 BP 725 Abidjan 20, Côte d'Ivoire

 

BP: 5405  Bastos, Dernier poteau, Yaoundé, Cameroon

 

PO Box 10-3218, 1000 Monrovia 10, Liberia

 

 

Appt 9, IMM 18, Rue Jbel Tazekka, Agdal, Rabat, 10090, Morocco

 

 

46, Avenue Oqba, Appt No. 2, Agdal, Rabat, Morocco

 

 

2, Berthan Macauley Street, Freetown, Sierra Leone

 

Quartier Diguel Nord, N'Djamena, Chad

 

 

 

21

Trade and other receivables

 

 

 

 

 

Group

Company

 

 

2017

2016

2017

2016

 

 

£

£

£

£

 

Trade receivables

1,051

135,953

-

-

 

Other receivables

4

-

-

-

 

VAT recoverable

32,754

42,808

2,485

-

 

Amounts due from group undertakings

-

-

510,724

-

 

 

 

 

 

 

 

Amounts due from related parties

31,468

58,024

-

-

 

Prepayments

            45,392

                       -

            14,704

                    -

 

 

                         

                        

                        

                        

 

 

          110,669

          236,785

          527,913

                    -

 

 

 

 

 

 

Trade receivables - credit risk

 

All trade receivables are denominated in £ sterling and are fully performing.

 

 

 

Fair value of trade receivables

 

The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.

 

 

 

 

No significant receivable balances are impaired at the reporting end date.

 

 

               

 

22

Trade and other payables

 

 

 

 

 

Group

Company

 

 

2017

2016

2017

2016

 

 

£

£

£

£

 

Trade payables

78,000

23,146

56,012

-

 

Other payables

30,985

16,058

6,250

-

 

Accruals and deferred income

         189,070

     284,659

         29,400

                    -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

         298,055

     323,863

         91,662

                    -

 

 

 

 

 

 

23

Provisions for liabilities

 

 

 

 

 

Group

Company

 

 

2017

2016

2017

2016

 

 

£

£

£

£

 

Provisions

      15,000

     15,000

           -

            -

 

 

 

 

 

 

All provisions are expected to be settled within 12 months of the reporting date.

 

A provision has been recognised in accordance with IAS 37 in respect of the company's obligation to its landlord for dilapidations on the expiry of its lease. The provision has been recognised because there is an obligation at the reporting date as a result of an onerous contract, where outflow is probable to settle the obligation and a reliable estimate can be made.

                     

 

 

24

Financial risk management

 

 

 

 

 

 

 

 

 

 

 

 

 

The Group's activities expose it to a variety of financial risks: credit risk, liquidity risk, price risk and interest rate risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Groups financial performance. There has been no change in the Group's risk management programme from previous years.

 

 

 

 

 

 

 

 

 

 

 

24.1 Market risk

 

 

 

 

 

 

The Group's activities potentially expose it to market risks, which is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risks arise from open positions in interest rate and foreign currency risk, all of which are exposed to general and specific market movements and changes in the level of volatility of market rates or prices such as interest rates and foreign exchange rates.

 

 

 

 

 

 

 

 

 

 

 

 

24.1.1 Foreign exchange risk

 

 

 

 

 

 

The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures. The Group's functional currency is pound sterling, and major purchases are transacted in pounds sterling, US dollars, West African francs, Ethiopian birr, Moroccan dirham and the Liberian dollar. The Group's head office expenditures are mainly incurred in pounds sterling and the majority of its exploration costs are incurred in the local African currencies. The Group believes the foreign exchange risk derived from currency fluctuations is not significant to its financial performance, and therefore does not consider it necessary to actively manage foreign exchange risk. For the year ended December 31, 2017, the Group had an exchange gain of £14,318 (2016: £38,605) which were not material to its operations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24.1.2 Commodity price risk

 

 

 

 

 

 

The Group's principal activity is the exploration for economic mineral deposits in Africa. The Group is therefore exposed to commodity price risks in the valuation of base minerals, which may impact the commercial viability of the licences it holds or impact the raising of future financing. The Group therefore maintains a diversified portfolio of licences in order to mitigate the risk of changes in the prices of individual base metals.

 

 

 

 

 

24.1.3 Interest rate risk

 

 

 

 

 

 

Interest rate risk is the possibility that changes in interest rates will result in higher financing costs or reduced income from the Group's interest bearing financial assets and liabilities. The Group is primarily financed through equity and interest rate risk arising on interest income is immaterial. The Group therefore does not currently consider it necessary to actively manage interest rate risk.

 

 

 

 

 

 

 

 

 

 

 

24.2 Credit risk

 

 

 

 

 

 

Credit risk is the risk of suffering financial loss should the Group's customers, clients or counterparties fail to fulfil their contractual obligations to the Group. The Group's core business is the exploration for economic mineral deposits in Africa and therefore the majority of expenditure is incurred in cash. The Group therefore only has significant exposure on its cash and cash equivalents. The Group mitigates this risk by depositing surplus cash with financial institutions with acceptable credit ratings. The carrying value of financial assets approximates their fair value and the maximum exposure as at the Statement of Financial Position date is outlined in the following table:

 

 

 

 

 

 

 

 

 

24

Financial risk management

 

 

 

(continued)

 

 

 

 

 

 

 

 

 

 

 

 

2017

2016

 

 

 

 

 

£

£

 

 

 

 

 

 

 

 

Trade receivables

 

 

 

1,051

135,953

 

Other receivables

 

 

 

4

-

 

VAT recoverable

 

 

 

32,754

42,808

 

Amounts due from related parties

 

 

 

31,468

58,024

 

Prepayments

 

 

 

45,392

17,694

 

Cash and cash equivalents

 

 

 

     523,342

   415,914

 

 

 

 

 

     634,011

  670,393

 

 

 

 

 

 

 

 

24.3 Liquidity risk

 

 

 

 

 

 

Liquidity risk is the risk that the Group is unable to meet its payment obligations associated with its financial liabilities when they fall due. Prudent liquidity risk management is achieved by maintaining sufficient cash balances and the availability of funding through an adequate amount of committed credit facilities. The Group manages liquidity by maintaining sufficient cash with banks to meet its changing commitments. The Group's objective is to ensure that there are sufficient committed financial resources to meet its current obligations and its future business requirements for a minimum of twelve months. At present the Group does not make use of any credit or debit facilities.

 

 

 

 

 

 

The table below presents the cash flows payable by the Group by remaining contractual maturities at the Statement of Financial Position date. The amounts disclosed in the table are the contractual undiscounted cash flows. The carrying values of financial liabilities approximates their fair values.

 

 

 

 

 

 

 

 

 

 

 

2017

 

Up to 3 months

3 to 12 months

Over 12 months

Total

 

 

 

£

£

£

£

 

 

 

 

 

 

 

 

Trade payables

 

78,000

-

-

78,000

 

Other payables

 

30,985

-

-

30,985

 

Accruals and deferred income

 

189,070

-

-

189,070

 

Provisions

 

       15,000

              -

             -

    15,000

 

 

 

     313,055

              -

             -

  313,055

 

 

 

 

 

 

 

 

2016

 

Up to 3 months

3 to 12 months

Over 12 months

Total

 

 

 

 

 

 

 

 

Trade payables

 

23,146

-

-

23,146

 

Other payables

 

16,058

-

-

16,058

 

Accruals and deferred income

 

284,659

-

-

284,659

 

Provisions

 

                 -

              -

    15,000

    15,000

 

 

 

    323,863

              -

   15,000

  338,863

 

 

 

 

 

 

 

 

25

Retirement benefit schemes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Defined contribution schemes

2017

2016

 

 

 

 

 

 

 

£

£

 

 

 

 

 

 

Charge to profit or loss in respect of defined contribution schemes

3,198

127,457

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

 

 

 

 

 

 

 

 

 

 

 

26

Share options

 

 

 

 

 

 

 

 

Non-EMI Share Options

 

 

 

 

 

 

 

 

The total number of non-EMI share options over Ordinary shares outstanding at 31 December 2017 was Nil (2016 - 8,170,000).

These share options were as follows:

 

 

 

 

 

 

 

 

Exercise

price

Outstanding 31 December 2016

('000s)

Exercised/

Cancelled

('000s)

31 December 2017

 

 

 

 

Date of grant/exercisable from

 

 

 

 

1 September 2007

 

 

0.75p

1,600

1,600

-

 

 

 

17 November 2007

 

1.5p

1,000

1,000

-

 

 

 

8 November 2009

 

1p

1,000

1,000

-

 

 

 

11 January 2012

 

      0.47p     

           4,570

            4,570

                 -

 

 

 

Total

 

 

           8,170

            8,170

                  -

 

 

 

 

 

 

 

 

 

 

 

 

The non-EMI share options held by directors, employees and non-employees during the year was as follows:

 

 

 

 

 

 

Date of grant/exercisable from

 

Exercise

price

0.75p

Outstanding 31 December 2016

1,600

David Netherway

-

Non-employees

1,600

 

 

 

1 September 2007

 

 

 

 

 

17 November 2007

 

1.5p

1,000

-

1,000

 

 

 

8 November 2009

 

1p

1,000

-

1,000

 

 

 

11 January 2012

 

0.47p

        4,570

            4,570

                  -

 

 

 

Total

 

 

        8,170

            4,570

         3,600

 

 

 

 

 

 

 

 

 

 

 

 

The weighted average of the exercise price per share of the non-EMI share options as at 31 December 2017 was Nil (2016 - £7.16).

 

 

 

 

 

 

 

 

 

 

 

Approved EMI Share Options

 

 

 

 

 

 

 

 

The total number of approved EMI share options over Ordinary shares outstanding at 31 December 2017 was nil. These share options were as follows:

 

 

 

 
                           

 

 

26

Share options

 

 

 

(continued)

 

 

 

 

 

 

 

 

Date of grant/exercisable from

 

Exercise

price

Number/

granted

Exercise/

Cancelled

31 December 2017

 

 

 

 

11 January 2012

 

£4.70

19,232

19,232

-

 

11 January 2016

 

£4.70

2,784

2,784

-

 

11 January 2016

 

£6.00

          7,125

          7,125

                  -

 

Total

 

 

      29,141

       29,141

                  -

 

 

 

 

 

 

 

 

The approved EMI share options held by directors, employees and non-employees as at 31 December 2017 were as follows:

 

 

 

 

 

Exercise price

Outstanding 31 December 2016

Steven Poulton

Matthew Grainger

Employees

 

Date of grant/exercisable from

 

 

 

 

 

 

 

 

 

11 January 2012

£4.70

19,232

-

13,089

6,143

 

11 January 2016

£4.70

2,784

2,784

-

-

 

11 January 2016

£6.00

          7,125

                 -

                  -

         7,125

 

Total

 

        29,141

        2,784

       13,089

       13,268

 

 

 

 

 

 

 

 

The Company does not currently have an approved EMI or unapproved share option plan in place and as such there are currently no share options in issue or outstanding.

 

As part of the IPO, the Company issued warrants over 110,000 ordinary shares of 1p. The warrants are exercisable at any time over a period of 12 months from the listing date, at an exercise price of 10p per share.

 

 

 

 

 

 

 

               

 

 

 

 

 

 

 

 

 

 

27

Share-based payments

 

 

 

 

 

 

 

 

 

 

 

 

 

Group and company

 

 

 

 

 

 

The weighted average fair value of options during the prior year was determined using the Black Scholes option pricing model.

 

 

 

 

 

 

2017

2016

 

 

 

Weighted average share price

 

-

£3.82

 

 

 

Weighted average exercise price

 

-

£6.00

 

 

 

Expected volatility

 

-

20.00%

 

 

 

Expected life

 

-

2 Years

 

 

 

Risk free rate

 

-

1.32%

 

 

 

Expected dividend yield

 

-

-

 

 

 

 

 

 

 

 

 

 

 

 

 

Group

 

Company

 

 

 

 

2017

2016

2017

2016

 

 

 

£

£

£

£

 

Expenses recognised in the year

 

 

 

 

 

 

Arising from equity settled share based payment transactions

 

 

 

 

 

 

 

           3,643

          3,398

  -  

             -    

 

 

 

 

 

 

 

During the year, Altus Exploration Management Limited issued 1,192,814 ordinary shares to directors and employees in settlement of services. The fair value of these services was £149,102 and has been recognised in profit or loss in the current year.

               

 

 

 

 

28

Subsequent events

 

 

 

 

 

 

 

 

 

Legend acquisition

 

 

 

 

 

 

 

 

 

On January 30, 2018, Altus acquired all of the outstanding shares of Legend Gold Corp. ("Legend"). A summary of the preliminary purchase price allocation for the Legend Acquisition is as follows:

 

 

 

 

 

 

 

Preliminary Purchase Price

 

 

 

 

Legend common shares outstanding as at January 30, 2018

 

 

13,686,752             

 

Exchange Ratio

 

 

3.0

 

Altus common shares issued to Legend shareholders

 

 

41,060,256

 

Fair value of Altus common share, in GBP on January 30, 2018

 

 

£0.085

 

Fair value of Altus common shares issued, in GBP

 

 

£3,490,122

 

Fair value of outstanding Legend warrants exchanged for Altus warrants

 

 

£102,000

 

Altus transaction costs

 

 

£138,000

 

 

 

 

 

 

Preliminary Purchase Price

 

 

£3,728,122

 

 

 

 

 

 

The value of the Altus ordinary shares was calculated based on the issuance of 41,060,256 shares at a price per share of £0.085 which was the closing Altus share price on 30 January 2018. The final purchase price may vary from the above calculation depending on whether there are additional transactions costs.

 

The replacement of Legend's warrants has been valued using the Black-Scholes option pricing model. The weighted average assumptions used in the Black-Scholes option pricing model are as follows:

 

 

 

 

 

 

 

Weighted average

Warrants

 

 

 

 

Discounted rate

0.60%

 

 

 

 

Expected life (years)

1.42

 

 

 

 

Expected volatility

100%

 

 

 

 

             

Altus has only recently become a public company and therefore does not have much trading history on which to base volatility. A volatility of 100% has been assumed for the purposes of this calculation. The fair value of the replacement warrants is based on the outstanding 2,888,618 warrants outstanding adjusted for the Share Exchange Ratio of 3.0 of Altus common shares per Legend warrant. The fair value per common share of Altus is the closing price on the Alternative Investment Market ("AIM") on January 30, 2018 and the foreign exchange rate of 1.7396 is the closing GBP to CAD exchange rate published by the Bank of England on January 30, 2018.

 

The transaction has been treated as an asset acquisition by Altus and therefore estimated transaction costs attributable to the acquisition totalling £138,000 have been included in the preliminary purchase price. The transaction costs are mainly legal expenses.

     Under IFRS 3, a business must have three elements: inputs, processes and outputs. Legend Gold Corp. ("Legend") was an early stage exploration company and had no mineral reserves and no plan to develop a mine. Legend did have title to mineral properties but these could not be considered inputs because of their early stage of development. Legend had no processes to produce outputs. Legend had not completed a feasibility study or a preliminary economic assessment on any of its properties and had no infrastructure or assets that could produce outputs. There was also no management or personnel within the Company that had any experience or expertise in mine development, mining, construction of mill equipment or in milling processes. Therefore, our conclusion was that the transaction was an asset acquisition and not a business acquisition.

 

 

28

Subsequent events                                                                                                                                           (continued)

 

 

 

 

Capital Raise

 

After the year the Company completed a non-brokered private placement offering of units ("Units") at an issue price of C$0.15 / £0.0846 per Unit to raise C$4,108,742 / £2,300,690. Each Unit was comprised of one Ordinary Share and one Ordinary Share purchase warrant of Altus ("Warrant") exercisable to purchase one Ordinary Share for five years at an exercise price of C$0.30.

 

29

Share capital

 

 

 

 

 

 

 

 

 

 

 

Company

2017

 

 

Ordinary share capital

 

£

 

 

 

 

Authorised, issued and fully paid

 

 

 

 

107,680,814 of 1p each

 

  1,076,808

 

 

 

 

 

 

 

On 14 June 2017, the Company undertook capital reorganisation by way of a share for share exchange with the shareholders of Altus Strategies Limited. Subsequent to the exchange Altus Strategies Limited became a 100% subsidiary of the Company and was renamed Altus Exploration Management Limited.

  During the year, 11,100,000 Ordinary shares of 1p each were issued at a premium of 9p per share, for cash consideration.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30

Share premium

 

 

 

 

 

 

 

Group

Company

 

 

 

2017

2016

2017

 

 

 

 

£

 

£

 

£

 

 

 

 

 

 

 

 

 

 

 

 

As at 1 January

5,770,590

5,748,587

-

 

 

 

Issue of new shares

1,901,106

21,993

999,000

 

 

 

Capital reorganisation

(6,672,696)

                   -

               -

 

 

 

 

 

 

 

 

 

 

As at 31 December

         999,000

  5,770,580

  999,000

 

 

 

 

 

 

 

 

31

Leases

 

 

 

 

 

 

 

 

 

 

Lessee

 

 

 

 

 

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows

 

 

 

 

Group

 

 

 

 

 

2017

2016

 

 

 

 

 

£

 

£

 

 

 

 

 

 

 

 

 

 

Within one year

 

 

2,441

-

 

 

Between two and five years

 

 

-

26,542

 

 

 

 

 

 

 

 

 

 

 

 

            2,441

         26,542

 

32

Related party transactions

 

 

 

 

 

 

 

 

 

 

 

 

 

Remuneration of key management personnel

 

 

 

 

 

 

See note 11 for details of key management. personnel remuneration

 

 

 

 

 

 

 

 

 

 

 

 

 

Transactions with related parties

 

 

 

 

 

 

During the year the group entered into the following transactions with related parties:

 

 

 

 

 

 

 

Sale of goods

Purchase of goods

 

 

 

 

 

2017

2016

2017

2016

 

 

 

£

 

£

 

£

 

£

 

 

 

Entities over which the company has control,

joint control or significant influence

             -

    14,324

              -

    31,758

 

 

 

 

 

 

 

 

 

The following amounts were outstanding at the reporting end date:

 

 

 

 

 

 

 

 

 

 

 

 

 

Transactions with related parties During the year the group entered into the following transactions with related parties:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts owed to related parties

 

 

 

 

 

2017

2016

 

 

 

 

 

£

 

£

 

 

 

Entities over which the company has control,

joint control or significant influence

 

 

510,724

741,856

 

 

 

 

 

 

 

 

33

Controlling party

 

 

 

 

 

 

 

 

 

 

 

 

 

There is no ultimate controlling party.

 

 

 

 

 

                                       

 

34

Cash flows from operating activities - group

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss for the year after tax

 

2017

2016

 

 

 

£

£

 

Adjustments for:

 

 

 

 

Interest received

 

(1,862,805)

(653,666)

 

Taxation charged

 

 

 

 

Investment income

 

 

 

 

Depreciation and impairment of property, plant and equipment

 

(61)

-

 

Other gains and losses

 

1,126

174

 

Equity settled share based payment

 

-

(307)

 

Movements in working capital:

 

1,413

2,375

 

(Increase)/decrease in trade and other receivables

 

(129,141)

(294,233)

 

Increase/(decrease) in trade and other payables

 

351,981

3,398

 

 

 

 

 

 

(Increase)/decrease in trade and other receivables

 

143,810

302,506

 

Cash used in operations

 

(29,826)

144,124

 

 

 

            __________

__________

 

 

 

Cash flows used in operating activities

 

 (1,523,505)

    (495,629)

 

 

 

 

 

 

 

 

 

 

35

Cash flows from operating activities - company

 

 

 

 

 

 

2017

 

 

 

 

£

 

 

 

 

 

 

 

Loss for the year after tax

 

(382,662)

 

 

Foreign exchange

 

40

 

 

Movements in working capital:

 

 

 

 

(Increase)/decrease in trade and other receivables

 

(527,913)

 

 

Increase/(decrease) in trade and other payables

 

91,622

 

 

 

 

            __________

 

 

 

 

Cash used in operations

 

     (818,913)

 

 

 

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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