Bushveld Minerals Regulatory News (BMN)

Bushveld Minerals Ltd

("Bushveld" or the "Company")

2017 Audited Annual Financial Results

Bushveld Minerals Limited (AIM: BMN), the vanadium producing company with a diversified projects portfolio of tin and coal assets in Southern Africa, is pleased to announce its audited annual financial results for the year ended 28 February 2017.

The full 2017 Annual Report is now available on the Company's website at the following link: http://bushveldminerals.com/financialreports.aspx

A printed copy of the 2017 Annual Report will be posted to the Company's shareholders as per individual request. A copy of the Notice of the Annual General Meeting to be held at 18-20 Le Pollet, St Peter Port, Guernsey GY1 1WH at 11 a.m. on Tuesday 12th September 2017 has also been posted to all shareholders.

Highlights/Key Achievements

Bushveld Vanadium

· In partnership with Yellow Dragon Holdings Limited, the Company completed, on 6 April 2017, the acquisition of a 78.8% interest in Strategic Minerals Corporation ("SMC"), which owns the primary vanadium mining and processing company Vametco Alloys (Proprietary) Limited ("Vametco") in South Africa.

· Signed cooperation Agreement between the Industrial Development Corporation of South Africa ("IDC") and Bushveld Energy Limited ("Bushveld Energy", a subsidiary of Bushveld Minerals Limited) for the joint development of market opportunities for Vanadium Redox Flow Batteries ("VRFBs") in Africa.

· Completed a techno-economic study on the manufacturing of electrolyte in South Africa.

· Completed a market study for VRFBs in Africa.

· Completed the Acquisition of the Brits Vanadium Project from Sable Metals Limited.

Greenhills Resources

· Completed the Acquisition of a 49.5% interest in Dawnmin Africa Limited ("Dawnmin"), which holds an 85% interest in the Uis Tin Project in Namibia.

Lemur Resources

· Signed a Memorandum of Understanding ("MoU") with Sinohydro, a subsidiary of PowerChina for the development of a 60MW coal-fired power plant based at Lemur Resources' (a Bushveld Minerals subsidiary) Imaloto Coal Project in Madagascar.

Enquiries: info@bushveldminerals.com

Bushveld Minerals Limited

Fortune Mojapelo +27 (0) 11 268 6555

Strand Hanson Limited (Nominated Adviser)

James Harris / Ritchie Balmer / Jack Botros +44 (0) 20 7409 3494

Beaufort Securities (Joint broker)

Jon Bellis +44 (0) 20 7382 8300

SP Angel Corporate Finance (Joint broker)

Ewan Leggat +44 (0) 20 3470 0470

Blytheweigh (Public Relations)

Tim Blythe / Camila Horsfall +44 (0) 20 7138 3204

Gabriella von llle +27 (0) 711 121 907

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulations (EU) No. 596/2014.

About Bushveld Minerals Limited

Bushveld Minerals is a diversified AIM listed mineral development company with a portfolio of vanadium, iron ore, tin and coal greenfield assets in Southern Africa and Madagascar. The Company's flagship platform, the vanadium platform, includes the Mokopane Vanadium Project, the Brits Vanadium Project, and the Bushveld Iron Ore & Titanium Project. The tin platform comprises the Mokopane Tin Project whereas the Imaloto Coal Project, which is being developed as one of Madagascar's leading independent power producers, makes up the Company's coal platform.

The Company's vision is to become the largest low cost integrated primary vanadium producer through owned low-cost high-grade assets. This incorporates development and promotion of the role of vanadium in the growing global energy storage market through Bushveld Energy, the Company's energy storage solutions provider. Whilst the demand for vanadium remains largely anchored in a slow growing steel industry, Bushveld Minerals believes there is a strong potential for imminent significant global vanadium demand surge from the fast-growing energy storage market, particularly through the use and adoption of Vanadium Redox Flow Batteries.

Bushveld Minerals' approach to project development recognises that whilst attractive project economics are imperative, they are insufficient to secure capital to bring them to account. A clear path to production with a visible timeframe, low capex requirements and scalability are important factors in retaining an attractive exit option. This philosophy is core to the Company's strategy in developing projects. Detailed information on the Company and progress to date can be accessed on the website: www.bushveldminerals.com

Chairman's Statement

I am delighted to present the Annual Financial Statements of Bushveld Minerals for the year ended 28 February 2017. I am particularly pleased to be doing this at a transformational point in the Company's development, as we transition from a junior exploration company to a producing company. Though commodity markets have markedly recovered since the lows of 2015/16, capital markets remain challenging particularly for junior miners for whom access to capital continues to be largely constrained.

We articulated a commodity-focused platform strategy in 2014 based on which we would develop each of the Company's three platforms, comprising Bushveld Vanadium, Greenhills Resources and Lemur Resources, with a view to building each on a path to independent existence with dedicated resources. At the same time we outlined our intention to prioritise vanadium as the flagship of the Company. Finally, we outlined four key pillars guiding the development of our projects, being (a) choosing commodities with a positive market outlook; (b) developing assets with a low cost curve positioning; (c) executing a clear realisable path to production and, thus, cash flows and finally (d) ensuring scalability.

I am pleased to report that the Company has been disciplined and consistent in delivering on this strategy. Each of the three platforms has made strides in realising its objectives. At Lemur Resources, the efforts to secure an Independent Power Producer licence for the project continue apace and we hope that the licence will be agreed shortly. I am encouraged to see the prominence and attention given to the Lemur Power Project by the government, including the Presidency of Madagascar at the recent Madagascar Investment Conference hosted by the South African Government in Pretoria during mid-June 2017. The power project will provide a captive market for the Imaloto Coal Project and see the planned project capital investment grow from an initial estimate of US$16m to over US$200m.

Meanwhile, the acquisition of a 49.5% interest in the Uis Tin Project provides Greenhills with the critical mass necessary for a stand-alone tin platform. The fact that the Uis Tin Project comes with a mining licence and a pilot plant that can be refurbished is an additional benefit that allows the project path to production to be accelerated. Efforts to list the Greenhills Resources platform separately are now well underway and expected to be completed during the next financial year.

It is in the flagship vanadium platform, however, that the most progress has been made. Most notable is the completion of the acquisition on the 6 April 2017, by Bushveld Vametco Limited (BVL), co-owned 45:55 with Yellow Dragon Holdings Limited, of the primary vanadium mining and processing company, Vametco Alloys (Proprietary) Limited. The Company also competed the acquisition of the Brits Vanadium Project, the development project which potentially hosts a significant strike extension of the current Vametco mine ore body. The acquisition of Vametco could not have been completed at a better time, with vanadium prices on a solid upward trajectory. Vametco is a quality low-cost producer with a sound financial position that has allowed us to use a significant amount of debt funding for the acquisition. That BVL has been able to pay back all the external debt and facilitate a BEE transaction for Vametco within four months of the completion of the transaction is testament to the strong balance sheet and cash-generation capacity of this important asset. In acquiring Vametco, BVL has not only acquired a quality operating mine and processing facility, but a management team with extensive experience in the vanadium industry combining more than 100 years of industry experience. In addition, the management team has worked on every one of the primary vanadium-processing plants in South Africa.

This intellectual capital will be important as we look to grow the combined Bushveld vanadium platform from its current 3.5% market share of the global vanadium supply to a share projected at more than 10% in the next three to five years.

I am also pleased to note the significant progress made by Bushveld Energy in establishing the market opportunity for vanadium redox flow batteries in Africa. Bushveld Energy has established an invaluable working relationship with its local partner, the Industrial Development Corporation of South Africa. Through delivery on our agreed objectives, we are on plan to vindicate the IDC's choice of large-scale energy storage as one of the significant new industries to support in South Africa. I look forward to seeing continued progress on what has been achieved to date over the course of the coming year.

All this progress is praiseworthy. It happens, however, amidst a time of significant uncertainty in the global political and economic sphere. The UK Brexit vote, US elections and elections in France where there was much at stake in terms of the future direction of these important economies, all contributed to an environment of general political and economic uncertainty. In South Africa, 2017 is an important year for the African National Congress (the country's ruling political party), which holds its congress to elect a new national leader at the end of the year. This elective congress promises to be a highly contested leadership race. It comes at a time when the ruling party has lost considerable ground to opposition parties and is facing significant internal divisions, with threats of alliances breaking away amid public outcry over allegations of state capture and corruption. The significance of this lies in the nature of South Africa's constitutional democracy, with the party that wins the elections appointing the president of the country.

The South African government recently attempted to gazette a new Mining Charter, placing greater obligations on mining companies. It proposes greater representation of historically disadvantaged persons in procurement opportunities, shareholding, management and the board composition of mining companies. The Mining Charter has, however, since been suspended pending an outcome of legal challenges brought by the South African Chamber of Mines.

An important antidote to this uncertainty, however, has to be a sound and functional democratic system within which the politics play out. This presents a source of confidence in the long-term investment case of South African based projects. South Africa enjoys a constitutional democratic order that is sound and effective and is underpinned by an effective independent judiciary and chapter 9 institutions such as the Public Protector.

Geology plays a significant part in primary vanadium producers' resource bases. South Africa has the largest and best quality primary vanadium resource base of any nation. As a consequence Bushveld Minerals is well positioned as it develops its integrated vanadium platform. Moreover, with over 90% of its costs being Rand denominated and more than 95% of its forecast revenues being foreign currency denominated, Bushveld has a natural hedge against any deterioration of local economic conditions, in addition to its already low cost curve positioning.

As the Company continues in its quest to become a significant vanadium producer and undertakes the listing of Greenhills Resources, it will see the already lean management team stretched across the two distinct platforms, imposing the need for more human capital Accordingly in the coming year we will bolster the management team and the Board to ensure that the Company has the requisite capacity for the journey ahead, a journey I am delighted to be a part of.

I would like to thank our management team for their considerable efforts in what has been a challenging but exciting time for our Company. The business is dependent upon the hard work, dedication and skills of all our team. I would in particular like to thank our CEO Fortune Mojapelo, who has led the team in an exemplary way. Also, to my colleagues on the board, I extend my appreciation for their wise council and advice that I have received this year.

Ian Watson

Non-Executive Chairman

CEO Report

It gives me great pleasure to present this annual report, following an eventful and indeed transformational year for Bushveld Minerals Limited. We have continued the disciplined execution of our strategy for our three key platforms, Bushveld Vanadium, Greenhills Resources and Lemur, guided by our four key principles: (a) commodity choice with robust market fundamentals; (b) attractive cost position; (c) a realisable path to production; and (d) scalability.

The Vanadium Flagship

Nowhere are these principles given better expression than in the development of Bushveld Minerals' flagship vanadium platform:

· Vanadium - a commodity with a robust and growing demand profile amid a constrained and concentrated supply environment resulting in a sustained structural deficit with no significant new supply in the near future;

· With some of the highest primary vanadium grade in the world, a low-cost open-cast simple mining proposition and access to brownfield processing infrastructure that can be acquired at a small fraction of its replacement cost, Bushveld will be one of the lowest production platforms on the vanadium cost curve;

· The participation alongside Yellow Dragon Holdings in the acquisition of Vametco gives the Company exposure to a production asset with a significant share of the global vanadium market and with scope to scale up production in future;

· A healthy pipeline of resources and complementary processing infrastructure to support the Company's growth aspirations. The acquisition of the Brits Vanadium project presents significant opportunities to significantly increase the Company's resource base, while the existence of several additional brownfield assets in South Africa in close proximity to the Company's vanadium deposits creates low cost and quicker opportunities for scale up.

Consequently we have crafted a vision to build the largest, lowest-cost vertically integrated vanadium company.

· The largest primary vanadium platform means having the largest high-grade primary vanadium resource base and the largest primary vanadium production in the world;

· The lowest cost means targeting the lowest cost position on the vanadium production cost curve, leveraging the high in-situ and in-magnetite V2O5 grades and the open-cast mining proposition of Bushveld Minerals' deposits as well as access to low-cost brownfield processing infrastructure;

· The most vertically integrated primary vanadium platform means development of downstream operations beyond production of end-use vanadium products to also include development and deployment of vanadium applications in industries such as the energy storage market, where Bushveld intends to manufacture vanadium electrolyte and to build large-scale vanadium based VRFBs.

The Vametco Transaction

An important part of realising this vision was the Company's 45% participation with Yellow Dragon Holdings Limited (55%) in the acquisition, from the Evraz Group S.A. of a 78.8% shareholding in Strategic Minerals Corporation, the parent company for the primary vanadium mining and processing plant of Vametco Alloys (Proprietary) Limited.

The transaction, completed on 6 April 2017, was completed less than four years since the company announced, in November 2013, its focus on developing the vanadium platform. Since this announcement, we have made significant strides, including completing a Scoping Study on the Mokopane Vanadium Project in April 2014, followed by a Prefeasibility Study in February 2016.

The Vametco vanadium mine is a high-quality, low-cost producer with a trademark vanadium product and a global vanadium customer base. Vametco is one of the cheapest primary producers of vanadium in the world. It currently has an approximate 3.5% share of global supply capacity and provides a solid platform for growing this production base. It is intended to leverage its processing capacity and broaden its product base to include vanadium chemicals, such as VRFB electrolyte. Our participation in the acquisition of Vametco as described in this report is therefore aligned with the Company's aspirations in the global energy storage market by providing capacity for potential electrolyte manufacturing.

The Vametco transaction gives impetus to the Company's vision to develop the largest, lowest-cost vertically integrated primary vanadium platform in the world. The transaction could not have been completed at a better time, with vanadium prices having staged a strong recovery. Vametco has an ungeared financial position and a healthy cash generation ability which enabled BVL to fund the acquisition largely through debt. US$14 million of the US$16.5 million acquisition consideration was fully repaid within four months of the completion of the transaction.

I am pleased that BVL was able to transfer customer contracts from Evraz Group seamlessly within a month of completion of the transaction, thanks in a large part to our partnership with Wogen Resources Limited, which brings decades of experience in metals trading, with a global footprint and established relationships with several of the Vametco customers.

Meanwhile Vametco has been delivering solid operational and financial performance. Production volumes in 2016 were a solid 2 804MTV, a 16% increase on 2015 volumes of 2 419MTV. The volume increase and weakening South African exchange rate (from ZAR12.75:US$1 in 2015 to ZAR14.71:US$1) in addition to improved operational performance saw Vametco improve its already low production costs from US$17.23/kgV to US$14.50/kgV. Consequently EBITDA performance improved between the two years from ZAR15.7 million (US$1.2 million) to ZAR47.5 million (US$3.2 million). This performance improvement has continued into 2017 supported in part by the significant rises in vanadium prices. At ZAR85.5 million (US$6.5 million) EBITDA for the first half of 2017 is already 80% higher than that of the entire 2015.

Going forward, BVL will leverage the solid Vametco platform, its experienced management team and the South African base to grow production volumes, drive down costs and add new vanadium products to its portfolio.

Four Key Priorities

To give effect to this vision we identified four key priorities that guide the Company's action programme. I am pleased with the progress the Company has made on all of them:

a) Advance Mokopane Vanadium Project

Notwithstanding the growing focus on the Vametco mine and processing plant, the Mokopane Vanadium Project is an important part of Bushveld's future plans. With a resource of 298Mt, a completed Pre-Feasibility Study and a Mining Right under application, this project is an important part of our vanadium portfolio. The project Pre-feasibility Study, completed in February 2016, reported a pre-tax NPV and IRR of US$418m and 24% respectively against a capital expenditure of US$298 million for a project producing 9,525 mtv of 99.8% V2O5. The attractiveness of the project is under-scored by the conservative long term average price of US$7.50/lb V2O5 which is conservative relative to vanadium prices at the date of this report (US$9.40 mid Metal Bulletin, 4 August 2017).

Significant progress was made during the year in our efforts to secure a new order mining right, including securing environmental authorisation for the project. We look forward to finalising the mining right and developing the project going forward. Efforts to find partnerships for the project are continuing. Furthermore, the Company will explore opportunities for supplying unprocessed ore or concentrate to vanadium-processing facilities around the world that are starved of vanadium feedstock.

b) Identify and secure quality brownfield processing infrastructure

Bushveld's vanadium deposits are located in a mining region with established logistics infrastructure and a deep history of beneficiation. The Company investigated several opportunities and, as mentioned earlier, in 2016 negotiated and agreed, in partnership with Yellow Dragon Holdings, the purchase of a 78.8% in SMC.

Our participation in the acquisition of an operating, profitable low-cost producer of vanadium at less than 10% of its replacement value is testament to the value in this approach.

The Company continues to explore further brownfield opportunities that are in close proximity to and are complementary with the Company's vanadium assets. This we will do by leveraging the strong technical skills within Bushveld Minerals and Vametco. Combining over 100 years of vanadium industry experience, the Vametco team has in-depth knowledge of vanadium mining, processing and marketing.

c) Support vanadium role in energy storage

The success of VRFBs in the burgeoning global energy market is important for the vanadium market - growing and diversifying the demand profile of a commodity that today is dominated by the steel industry with about 90% of vanadium consumption. In addition, the energy storage market itself offers a compelling commercial proposition for Bushveld Minerals. Yet the success of VRFBs must overcome two key hurdles: (a) security of supply and (b) security of cost of the VRFBs, both of which are accentuated by the significant reduction of supply in the past 18 months, with no significant new capacity in the horizon, as well as the more than 150% increase in vanadium prices to an 8 year high in the past 18 months.

We believe that the answer to these hurdles lies in a vertically integrated business model involving low-cost vanadium production assets. Bushveld is more than ever ideally placed, through its energy storage dedicated company Bushveld Energy Limited, to play a catalytic role in driving VRFB adoption in the global market by effectively addressing these two hurdles. This vertically integrated model is pursued through smart strategic partnerships along the value chain.

I am pleased that in the review period Bushveld added to its strategic partnership with technology partner UniEnergy Technologies, a leading US-based manufacturer of large-scale VRFBs, by signing a Cooperation Agreement with the Industrial Development Corporation of South Africa. Bushveld Energy could not have found a better partner in the IDC. I am pleased with the positive outcome of the two completed studies in respect of VRFBs; these now pave the way for pursuing the VRFB opportunity further.

In addition, Bushveld Energy is developing optimal sites for large-scale VRFB demonstration systems of multiple megawatt hours in South Africa in parallel with building up a short-to-medium-term energy storage project development backlog across Africa to tap into the multi-gigawatt-hour opportunity for large-scale energy storage.

I am pleased to note that the benefits of VRFBs are increasingly recognised - long life cycle, low levelised cost of energy, etc. Bushveld Energy has and continues to play a key role in this respect, including being an important part of the Vanitec Energy Storage Committee, through which the vanadium industry cooperates to support the VRFB industry.

d) Consolidate primary vanadium resources

Bushveld Minerals believes the future of vanadium supply lies with high-grade primary vanadium suppliers. This is underscored by the structural challenges faced by vanadium-slag-producing steel plants, which account for as much as 64% of vanadium feedstock supply and yet whose viability is structurally challenged on account of their high magnetite iron input costs, high processing costs and general lack of influence on the low steel prices afflicting their profitability. Nowhere are the consequences of these constraints clearer than the shutdown of Highveld Steel and Vanadium during 2015.

The Company's efforts in this regard were focussed on completing the acquisition of the Brits Vanadium Project, which comprises prospecting rights on several farms adjacent to the producing Vametco plant. The Company was, as at the reporting date, in the process of securing regulatory approval in terms of section 11 of the Mineral and Petroleum Resources Development Act for change of control in respect of the acquired Sable Metals & Mining Limited's subsidiaries. Following approval, Bushveld Minerals will commence with activities to delineate the project's extensive shallow resource.

Unlocking value from the other platforms

While our focus has been on the vanadium platform, we will continue to execute a strategy for the other two platforms - Greenhills Resources (tin) and Lemur (coal and power generation) - aimed at crystallising and realising value for our shareholders, as outlined in this report.

· For Greenhills Resources Limited that strategy entails consolidating a critical mass of tin resource inventory, implementing a pilot production programme and exploring options for a potential listing of Greenhills Resources.

· For Lemur this entails securing a power purchase agreement for a 60MW thermal coal power project as well as tying up partnerships with financial and EPC (Engineering, Procurement and Construction) partners ahead of a potential spin-off of Lemur.

Greenhills Resources Limited

Subsequent to the year in review saw Greenhills Resources complete the acquisition of a 49.5% interest in Dawnmin, which owns an 85% interest in the Uis Tin Project in Namibia.

With valid mining licences in place and an old processing plant (albeit in need of refurbishing), Greenhills Resources intends to accelerate this project into production. Greenhills Resources' approach to bringing this mine into full-scale production includes:

· Mapping out the higher-grade greisened zones that are the target for early stage mining;

· Completing the mineralogical and metallurgical studies to fine-tune the pilot plant for a consistent production phase based on which techno-economic parameters for the scaled up larger plant can be confirmed;

· Completing the refurbishment of the old pilot plant and running it on a consistent basis for several months; and

· Confirm the existing Uis Project resources in accordance with the JORC standards.

Having achieved a critical mass of tin resource inventory, and with a valid mining licence for the Uis Tin Project, Greenhills Resources is well positioned for life as a stand-alone platform through an IPO on AIM in the near term, efforts for which are now already underway. This will allow Greenhills Resources to attract the dedicated resources (financial and human capital) to be successful as an African focused tin and associated metals champion.

Lemur Resources Limited

The past year has seen significant progress in the development of Lemur's Imaloto coal project in Madagascar. The Company's strategy for the development of the project involves securing an Independent Power Producer licence and a Power Purchase Agreement for a thermal coal fired power station next to the coal mine, thereby providing a captive market for the Imaloto project run-of-mine coal. Negotiations with the Madagascar authorities regarding the PPA have progressed well during the year under review.

In addition, I am pleased that Lemur signed a Memorandum of Understanding with PowerChina for the development of a 60MW thermal coal power plant in Madagascar. The MoU provides a sound framework for cooperation between Lemur and PowerChina, which has extensive experience investing in and developing large-scale power projects in Africa. It further provides for PowerChina funding the bankable feasibility for the power project, which will provide a ready and captive market for the Imaloto coal project. Since the signing of this MoU, Lemur has led a delegation to Madagascar intended, among other things, to help identify the optimal site for the power plant. Meanwhile, Lemur has also engaged the services of Advisian Advisory as the Owner's Engineer to represent Lemur in our engagement with PowerChina, Jirama (the Madagascar national power utility) and external funders for the project, undertake several studies that form a part of the bankable feasibility study for power project and ensure that all environmental studies are done to internationally accepted standards.

The development of the Imaloto project, including the mine and the power plant, will see the region receiving new infrastructure and stable energy access. Thousands of new jobs will be created, over US$1 billion in new government revenue will be generated and approximately US$300 million in new investment in the country will be achieved. The design and location of the project are such that it will immediately increase the country's power supply by 15% and be able to scale up to supply more power to new electricity users in the region in the longer term.

General Operating Environment

The economic environment for mining and South Africa in particular remains a challenging one. Uncertainty relating to the new Mining Charter presents risks to Bushveld's South African operations, as does the overall political uncertainty prevailing in South Africa. We note, however, that political uncertainty is as much a global phenomenon as it is South African. Our assets are of a high quality and their export proposition, coupled with a local cost base, present a natural hedge against any adverse developments in the local economy.

A proactive strategy in dealing with various stakeholders is essential. Bushveld and its operating subsidiaries are well positioned to address issues with respect to stakeholder engagement at all major levels of government, communities and employees. Bushveld's transaction in support of a new Black Economic Empowerment partner for Vametco, Jaxson 640 (Proprietary) Limited ("Jaxson"), in terms of which Bushveld provided loan financing of approximately US$1 million for Jaxson to buy out the previous BEE shareholders in Vametco Holdings is an example of this proactive approach. As a consequence of this transaction, the local landowners and affected communities' shareholding in Vametco increased from 3.75% to about 12%.

Bushveld Minerals continues to make strides in developing its projects across all its three platforms in spite of the constrained operating environment.

Financial Report

As mentioned elsewhere in this report, the most significant transaction during the current financial year was the Company's participation in the Vametco acquisition by Bushveld Vametco Limited, which was completed post year end. The strong cash flow generating ability of the underlying operations enabled the acquisition to be largely debt-funded (US$14.0 million). BVL's equity component of US$2.47 million was settled in two parts, US$1.65 million during the current financial year, with a further US$0.82 million settled post year-end upon completion of the acquisition in April 2017.

Total cash and cash equivalents at the beginning of the financial year amounted to £478,619. During the current financial year Bushveld raised approximately £3.4 million from three separate capital raisings, as well as various warrant-for-share conversions by shareholders. The cash raised from these capital raises were largely used to pursue the Company's participation in the Vametco acquisition, plus associated due diligence and other expenditures, as well as settling our obligations (principal and interest) to Darwin Strategic. The Directors maintained tight discipline over cash operating expenses, which decreased by 10% from the previous financial year to approximately £1.4 million.

During the current financial year the Company's cash resources have materially been applied as shown in the table below:

The year ahead

In the year ahead Bushveld will continue to execute on its stated strategy, focusing on:

· Working with Yellow Dragon Holdings to grow the Vametco's production volumes and exploring further brownfield opportunities complementary to the Company's vanadium assets.

· In addition, Bushveld Energy will work with its VRFB technology partners to unlock the potential for vanadium electrolyte production within the global energy storage market;

· Unlocking value in its Madagascar coal project through securing an IPP licence and continuing the feasibility studies on a 60MW thermal coal power project;

· Completing the listing of Greenhills Resources and thus establishing an AIM-listed dedicated African tin champion well placed to consolidate quality tin assets in Africa; and

· Growing our human capital base to meet the growing demands of a growing company. I look forward to building on our existing team and introducing more senior-level leadership in the areas of operations, investor relations and project development. At the same time, the Company will look to further strengthen the board of directors to ensure it is well suited to provide the kind of oversight and support required by management.

Conclusion

The year under review has been an eventful and transformational one underscored by BVL's acquisition of the Vametco primary vanadium mine and processing plant. This has reflected in a 641% surge in the Company's share price from 1.53p to 9.80p between 1 August 2016 and 31 July 2017. The re-rate to a market capitalisation of more than £78 million at the beginning of August 2017 reflects our on-going transformation into a portfolio that includes a mining operation with access to cash flows and a potential for further returns to our shareholders. Notably during the same period, Bushveld shareholders suffered only a modest dilution as a consequence of the Company's capital raising, increasing its issued shares from 591,6 million to 806.6 million. We believe there is significant growth yet to be realised as we execute on our strategy.

The BVL acquisition was not without its challenges; not least initially looking to raise financing that, at the time of the agreement execution, was more than Bushveld's market capitalisation and during a challenging capital raising environment for junior mining companies. Bushveld Minerals and its strategic partner in BVL, Yellow Dragon Holdings, are grateful to Wogen Resources Limited and the Barak Fund, who believed in our proposition and provided the needed financing to complete the transaction.

I am thankful for the support of the entire Bushveld Minerals team for continuing to show incredible commitment to the Company. I am also thankful for the support of the Board and most importantly of our shareholders. I believe Bushveld Minerals is at a critical transformational point in its story and look forward to the next chapter in its development.

We are excited about what the future holds as we continue on our journey to build the world's largest, lowest cost and most vertically integrated vanadium platform.

Fortune Mojapelo

Chief Executive Officer

Consolidated Income Statement

For the year ended 28 February 2017

All results relate to continuing activities.

The notes on pages 21 to 56 form part of these financial statements.

Consolidated Statement of Comprehensive Income

For the year ended 28 February 2017

Consolidated Statement of Financial Position

As at 28 February 2017

Company number: 54506

The notes on pages 21 to 56 form part of these financial statements.

The financial statements were authorised and approved for issue by the Board of directors and authorised for issue on 14 August 2017.

Consolidated Statement of Changes in Equity

For the year ended 28 February 2017

Attributable to owners of the parent company

Consolidated Statement of Cash Flows

For the year ended 28 February 2017

The notes on pages 21 to 56 form part of these financial statements.

Notes to the consolidated financial statements

For the year ended 28 February 2017

1. Corporate information and principal activities

Bushveld Minerals Limited ("Bushveld") was incorporated and domiciled in Guernsey on 5 January 2012, and admitted to the AIM market in London on 26 March 2012.

The Bushveld Group comprises Bushveld Minerals Limited and its subsidiaries as noted below.

The wholly owned Guernsey subsidiaries Bushveld Resources Limited (BRL) and Greenhills Resources Limited (GRL) were acquired by Bushveld under the terms of a Share Exchange Agreement entered into on 15 March 2012. In 2016 the Company completed the acquisition of Lemur Holdings Limited (Lemur).

BRL is an investment holding company formed to invest in resource-based vanadium and iron ore exploration companies in South Africa. The South African subsidiaries are Pamish Investments No. 39 (Proprietary) Limited ("Pamish 39") in which BRL holds a 64% equity interest, Amaraka Investments No. 85 (Proprietary) Limited ("Amaraka 85") in which BRL holds 68.5% equity interest and Frontier Platinum Resources (Proprietary) Limited in which BRL holds 100% equity interest. The minority shareholder in Pamish 39 is Izingwe Capital (Proprietary) Limited and the minority shareholder in Amaraka 85 is Afro Multi Minerals (Proprietary) Limited.

GRL is an investment holding company formed to invest in resource-based tin exploration companies in South Africa. The South African subsidiaries are Mokopane Tin Company (Proprietary) Limited in which GRL holds 100% equity interest and Renetype (Proprietary) Limited ("Renetype") in which GRL holds a 74% equity interest. The minority shareholders in Renetype are African Women Enterprises Investments (Proprietary) Limited and Cannosia Trading 62 CC who own 10% and 16% respectively.

The Lemur subsidiaries are coal project development companies. The Lemur subsidiaries are the holder of 11 concession blocks in South West Madagascar covering the Imaloto Coal Basin, known as the Imaloto Coal Project and Extension.

As at 29 February 2017, the Bushveld Group comprised:

1 Held directly by Bushveld Minerals Limited

2 Held by Bushveld Resources Limited

3 Held by Greenhills Resources Limited

4 Held by Mokopane Tin Company (Pty) Limited

5 Held by Lemur Holdings Limited

6 Held by Bushveld Energy Limited

7 Held by Lemur Investments Ltd

8 Held by Imaloto Power Ltd

9 Held by Lemur South Africa Ltd

These financial statements are presented in Pound Sterling (£) because that is the currency the Group has raised funding on the AIM market in the United Kingdom.

1. Adoption of new and revised standards

ACCOUNTING STANDARDS ADOPTED DURING THE YEAR

New standards, amendments to published standards and interpretations to existing standards effective in 2016, with their dates of adoption adopted by the Group and brief description:

* not yet endorsed by the EU

Following the adoption of these standards there has been no change to the group accounting policies and there has been no material impact on the financial statements of the Group.

ACCOUNTING STANDARDS AND INTERPRETATIONS NOT APPLIED

Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted by the Group:

* not yet endorsed by the EU

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the financial statements of the Group, subject to any future business combinations.

2. Significant accounting policies

Basis of accounting

These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively "IFRS") issued by the International Accounting Standards Board ("IASB") as adopted by the European Union ("adopted IFRS"), and are in accordance with IFRS as issued by the IASB.

The consolidated financial statements have been prepared under the historical cost basis, except for the revaluation of financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for the assets. The principal accounting policies are set out below.

Going concern

The directors have considered the current financial position of the Group and the likely future cash flows for the period of 12 months following the approval of these financial statements in preparing the 2017 Year financial statements. Further funds will be required to finance the Group's working capital requirements and development of the Group's assets. If cash flow from existing sources was not sufficient to meet the Group's commitments the Directors are confident that additional funds would be successfully raised from other sources. However, there are no binding agreements in place to date. These conditions indicate the existence of a material uncertainty which may cast significant doubt about the Group's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the Company was unable to continue as a going concern.

Basis of consolidation

Subsidiaries

Subsidiaries are all entities (including structured entities) over which the group has control. The group controls an entity when the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases.

The group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest's proportionate share of the recognised amounts of acquiree's identifiable net assets.

Acquisition-related costs are expensed as incurred.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer's previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognised in profit or loss.

Any contingent consideration to be transferred by the group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39 either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity.

Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated. When necessary amounts reported by subsidiaries have been adjusted to conform with the group's accounting policies.

Disposal of subsidiaries

When the group ceases to have control any retained interest in the entity is re-measured to its fair value at the date when control is lost, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

Non-controlling interests

Non-controlling interests in subsidiaries are identified separately from the Group's equity therein. Those interests of non-controlling shareholders that present ownership interests entitling their holders to a proportionate share of the net assets upon liquidation are initially measured at fair value. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests' share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Associates

Associates are all entities over which the group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor's share of the profit or loss of the investee after the date of acquisition. The group's investment in associates includes goodwill identified on acquisition.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.

The group's share of post-acquisition profit or loss is recognised in the income statement, and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the group's share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.

The group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to share of profit/(loss) of associates in the income statement.

Profits and losses resulting from upstream and downstream transactions between the group and its associate are recognised in the group's financial statements only to the extent of unrelated investor's interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the group.

Dilution gains and losses arising in investments in associates are recognised in the income statement

Segment 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, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the steering committee that makes strategic decisions.

Foreign currencies

Functional and presentational currency

The individual financial statements of each Group company are prepared in the currency of the primary economic environment in which they operate (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of each Group company are expressed in Pound Sterling, which is the functional currency of the Company, and the presentation currency for the consolidated financial statements.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when deferred in other comprehensive income as qualifying cash flow hedges and qualifying net investment hedges. Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the income statement within 'finance income or costs'. All other foreign exchange gains and losses are presented in the income statement.

Group companies

The results and financial position of all the group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

a) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;

b) income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

c) all resulting exchange differences are recognised in other comprehensive income.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. Exchange differences arising are recognised in other comprehensive income.

Finance income

Interest revenue is recognised when it is probable that economic benefits will flow to the Group and the amount of revenue can be measured reliably. Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.

Taxation

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

The tax charge is based on taxable profit for the year. The Group's liability for current tax is calculated by using tax rates that have been enacted or substantively enacted by the reporting date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the "balance sheet liability" method.

Deferred tax liabilities are 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. Deferred tax is calculated at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled based upon rates enacted and substantively enacted at the reporting date. Deferred tax is charged or credited to profit or loss, except when it relates to items credited or charged to other comprehensive income, in which case the deferred tax is also dealt with in other comprehensive income.

Intangible exploration and evaluation assets

All costs associated with mineral exploration and evaluation including the costs of acquiring prospecting licences; mineral production licences and annual licences fees; rights to explore; topographical, geological, geochemical and geophysical studies; exploratory drilling; trenching, sampling and activities to evaluate the technical feasibility and commercial viability of extracting a mineral resource; are capitalised as intangible exploration and evaluation assets and subsequently measured at cost.

If an exploration project is successful, the related expenditures will be transferred at cost to property, plant and equipment and amortised over the estimated life of the commercial ore reserves on a unit of production basis (with this charge being taken through profit or loss). Where a project does not lead to the discovery of commercially viable quantities of mineral resources and is relinquished, abandoned, or is considered to be of no further commercial value to the Group, the related costs are recognised in profit or loss.

The recoverability of deferred exploration costs is dependent upon the discovery of economically viable ore reserves, the ability of the Group to obtain necessary financing to complete the development of ore reserves and future profitable production or proceeds from the extraction or disposal thereof.

Impairment of exploration and evaluation assets

Whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, the asset is reviewed for impairment. Assets are also reviewed for impairment at each balance sheet date in accordance with IFRS 6. An asset's carrying value is written down to its estimated recoverable amount (being the higher of the fair value less costs to sell and value in use) if that is less than the asset's carrying value. Impairment losses are recognised in profit or loss.

An impairment review is undertaken when indicators of impairment arise but typically when one of the following circumstances applies:

• unexpected geological occurrences that render the resources uneconomic; or

• title to the asset is compromised; or

• variations in mineral prices that render the project uneconomic; or

• variations in the foreign currency rates; or

• the Group determines that it no longer wishes to continue to evaluate or develop the field.

Warrants

The warrants issued by the company are recorded at fair value on initial recognition net of transaction costs. The fair value of warrants granted is recognised as an expense or as share issue costs, with a corresponding increase in equity. The fair value of the warrants granted is measured using the Black Scholes valuation model for options without market conditions and using the binomial method for those with market conditions, taking into account the terms and conditions under which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of warrants that vest.

Property, plant and equipment

Property, plant and equipment is stated at historical cost less accumulated depreciation.

Land is not depreciated. Depreciation is provided on all plant and equipment at rates calculated to write each asset down to its estimated residual value, using the straight-line method over their estimated useful life of the asset as follows:

• The mining assets amortised over the life of the mine or 20 years whichever is the lesser;

• Geological equipment over one to three years;

• Motor vehicles over three years; and

• Fixtures and fittings over two years.

The estimated useful lives, residual values and depreciation methods are reviewed at each year end and adjusted if necessary.

Gains or losses on disposal are included in profit or loss.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount

Impairment of property, plant and equipment

At each statement of financial position date, the Group reviews the carrying amounts of its tangible 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 the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Where there has been a change in economic conditions that indicate a possible impairment in a cash-generating unit, the recoverability of the net book value relating to that field is assessed by comparison with the estimated discounted future cash flows based on management's expectations of future oil prices and future costs.

The 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 (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Where conditions giving rise to impairment subsequently reverse, the effect of the impairment charge is also reversed as a credit to the income statement, net of any depreciation that would have been charged since the impairment.

Financial assets and liabilities

Financial assets and financial liabilities are recognised in the Group's balance sheet when the Group becomes a party to the contractual provisions of the instrument. Financial instruments are classified into specified categories dependent upon the nature and purpose of the instruments and are determined at the time of initial recognition. All financial assets are recognised as loans and receivables or available for sale investments and all financial liabilities are recognised as other financial liabilities.

Trade and other receivables

Trade and other receivables are stated initially recognised at the fair value of the consideration receivable less any impairment. Impairment provisions are recognised when there is objective evidence that the Group will be unable to collect all of the amounts due under the terms of the receivable, the amount of such a provision being the difference between the carrying amount and the present value of the future expected cash flows associated with the impaired receivable.

Trade and other receivables are subsequently measured at amortised cost, less any impairment.

Cash and cash equivalents

Cash and cash equivalents comprise cash at hand and deposits on a term of not greater than three months.

Trade and other payables

Trade and other payables are initially recognised at fair value. They are subsequently measured at amortised cost using the effective interest rate method.

Available for sale financial assets

Listed shares held by the Group that are traded in an active market are classified as being available for sale and are stated at fair value. The fair value of such investments is determined by reference to quoted market prices.

Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated in the investments revaluation reserve with the exception of impairment losses. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in the investments revaluation reserve is reclassified to profit or loss.

Dividends on available for sale equity instruments are recognised in profit or loss when the Group's right to receive the dividends is established.

Financial liabilities and equity

Financial liabilities (including loans and advances due to related parties) and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. When the terms of a financial liability are negotiated with the creditor and settlement occurs through the issue of the Company's equity instruments, the equity instruments are measured at fair value and treated as consideration for the extinguishment of the liability. Any difference between the carrying amount of the liability and the fair value of the equity instruments issued is recognised in profit or loss.

Use of estimates and judgements

In the application of the Group's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

Estimates and judgements are continually evaluated. Revisions to accounting estimates are recognised in the year in which the estimates are revised if the revision affects only that year, or in the year of revision and in future years if the revision affects both current and future years.

Management's critical estimates and judgements in preparing the financial statements relate to the going concern assumption (see above) and the valuation of intangible exploration assets of £60.2m (2016: £56.4m).

Determining whether an exploration and evaluation asset is impaired requires an assessment of whether there are any indicators of impairment, including by reference to specific impairment indicators prescribed in IFRS 6 Exploration for and Evaluation of Mineral Resources. If there is any indication of potential impairment, an impairment test is required based on value in use of the asset. The valuation of intangible exploration assets is dependent upon the discovery of economically recoverable deposits which, in turn, is dependent on future iron ore and tin prices, future capital expenditures and environmental and regulatory restrictions. The directors have concluded that there are no indications of impairment in respect of the carrying value of intangible assets at 28 February 2017 based on planned future development of the projects and current and forecast commodity prices.

4. Segmental reporting

The reporting segments are identified by the directors of the Group (who are considered to be the chief operating decision makers) by the way that Group's operations are organised. As at 28 February 2017 the Group operated within three operating segments, mineral exploration activities for iron ore and vanadium, tin and coal. Exploration activities take place in South Africa (iron ore and tin), Namibia (tin)Madagascar (coal).

Segment revenue and results

The following is an analysis of the Group's revenue and results by reportable segment.

The reconciliation of segmental gross loss to the Group's loss before tax is as follows:

4. Other segmental information

Segmental assets and liabilities disclosed in the reports to the Board of directors, for the purpose of resource allocation and assessment of segmental performance, consist of the amounts capitalised as intangible exploration expenditure. All other assets and liabilities are classified as unallocated.

5. Expenses by nature

6. Staff costs

Key management personnel have been identified as the Board of directors. Details of key management remuneration are shown in note 22.

Included above are emoluments of £120,112 (2016: £108,333) in respect of the highest paid Director.

No pension contributions were made on behalf of the Directors and other staff members.

7. Finance income

8. Finance expense

7.

9. Taxation

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

Accumulated losses in the subsidiary undertakings for which there is an unrecognised deferred tax asset are£ 276,900 (2016 £ 102,617).

10. Loss per share

From continuing operations

The calculation of a basic loss per share of 0.28 pence (2016: 0.39 pence), is calculated using the total loss for the year attributable to the owners of the company of £1,705,920 (2016: £1,699,000) and the weighted average number of shares in issue during the year of 601,801,830 (2016: 460,361,182). There are no potentially dilutive shares in issue.

11. Intangible exploration and evaluation assets

The Company's subsidiary, Bushveld Resources Limited has a 64% interest in Pamish Investment No 39 (Proprietary) Limited ("Pamish") which holds an interest in Prospecting right 95 ("Pamish 39"). Bushveld Resources Limited also has a 68.5% interest in Amaraka Investment No 85 (Proprietary) Limited ("Amaraka") which holds an interest in Prospecting right 438 ("Amaraka 85").

Under the agreements to acquire the licences within Bushveld Resources, the group is required to fully fund the exploration activities up to the issue of the corresponding mining licences. As the non-controlling interest party retains their equity interest, the funding of their interest is accounted as deemed purchased consideration and is included in the additions in the year to exploration activities. A corresponding increase is credited to non-controlling interest.

The Company's other directly owned subsidiary, Greenhills Resources Limited, has a 74% interest in Renetype (Proprietary) Limited ("Renetype") which holds an interest in Prospecting right 2205 ("Renetype 2205").

Brits Vanadium Project

The Company completed the purchase during the year of the following licences through the acquisition of subsidiary undertakings of Sable Metals & Minerals Limited:

· NW 30/5/1/1/2/11069 PR - held through Great Line 1 (Pty) Ltd

· NW 30/5/1/1/2/11124 PR - held through Great Line 1 (Pty) Ltd

· GP 30/5/1/1/02/10142 PR - held through Gemsbok Magnetite (Pty) Ltd

The Company is in a process to secure regulatory approval in terms of section 11 of the Mineral and Petroleum Resources Development Act (MPRDA) for change of control in respect of the acquired Sable Metals & Mining Ltd's subsidiaries. Following approval, Bushveld Minerals will commence with activities to delineate the shallow resource on the Uitvalgrond farm portion.

At the date of approval of these financial statements, three of the Group's exploration licences remain due for renewal. Applications have been submitted for renewal of these licences as they become due and the directors have no reason to believe that these renewals will be unsuccessful.

12. Property, plant and equipment

Mining asset

In 2016 the Group acquired the shares in Zaaiplaats Mining (Proprietary) Limited the owner of the following properties:

· Remaining Extent of Portion 25 of the farm Groenfontein 227 KR Limpopo Province and

· Portion 5 of the farm Roodepoort 222 KR Limpopo Province.

The tailings dumps situated on the property are currently being exploited for building sand.

An Application for a Mining Right has been lodged with the Department of Mineral Resources to enable the Group to commence mining activities for tin.

During the year depreciation of £nil was capitalised to the intangible exploration and evaluation asset (2016: £23,955).

13. Trade and other receivables

Advances and deposits in 2016 related to amounts held in escrow in relation to the Darwin Facility (see note 15).

The amounts due from associate relate to advances to BVL in respect of the post year end SMC transaction (see note 21).

The directors consider that the carrying amount of trade and other receivables approximates to their fair value due to their short term nature. As at the year end, no receivables are past their due date, hence no allowance for doubtful receivables is provided.

The total trade and other receivables denominated in South African Rand amount to £464,041 (2016: £120,140) and denominated in Australian Dollars amount to £1,237 (2016: £20,718).

14. Cash and cash equivalents

Cash and cash equivalents (which are presented as a single class of assets on the face of the Statement of Financial Position) comprise cash at bank and other short-term highly liquid investments with an original maturity of three months or less. The directors consider that the carrying amount of cash and cash equivalents approximates their fair value. The total cash and cash equivalents denominated in South African Rand amount to £92,913 (2016: £49,622) and £3,154 (2016: £83,135) is denominated in Australian Dollars.

15. Borrowings

During the year the Company released the £2.6m previously held in escrow to Darwin in accordance with the agreed terms of the facility and subsequently terminated the agreement. All interest relating to the facility was settled with cash during the year.

16. Trade and other payables

Trade and other payables principally comprise amounts outstanding for trade purchases and on-going costs. The average credit year taken for trade purchases is 30 days.

The Group has financial risk management policies in place to ensure that all payables are paid within the pre-arranged credit terms. No interest has been charged by any suppliers as a result of late payment of invoices during the year.

The directors consider that the carrying amount of trade and other payables approximates to their fair value.

The total trade and other payables denominated in South African Rand amount to£312,756 (2016: £187,849) and £18,535 (2016: £14,012) is denominated in Australian Dollars.

17. Share capital and share premium

The Board may, subject to Guernsey Law, issue shares or grant rights to subscribe for or convert securities into shares. It may issue different classes of shares ranking equally with existing shares. It may convert all or any classes of shares into redeemable shares. The Company may also hold treasury shares in accordance with the law. Dividends may be paid in proportion to the amount paid up on each class of shares.

As at the 28 February 2017 the Company owns 670,000 (2016: 670,000) treasury shares with a nominal value of 1 pence

During the year the Company issued 7,000,000 new ordinary shares at a price of 1.8 pence per share in respect of the remaining consideration payable for the Brits Vanadium Project.

During the year the Company issued a total of 98,333,334 new ordinary shares at a price of 1.8 pence per share raising gross cash proceeds of £1,770,000.

During the year the Company issued a total of 38,666,668 new ordinary shares at a price of 1.5 pence per share raising gross cash proceeds of £580,000.

During the year the Company issued a total of 53,571,430 new ordinary shares at a price of 1.4 pence per share raising gross cash proceeds of £750,000.

18. Warrants

The following warrants were granted during the year ended 28 February 2017:

The estimated fair values were calculated by applying the Black Scholes pricing model. The model inputs were:

The following warrants were granted in previous years:

The estimated fair values were calculated by applying the Black Scholes pricing model. The model inputs were:

The warrants in issue during the year are as follows:

The warrants outstanding at the year-end have an exercise price of £0.02, with a weighted average remaining contractual life of 2 years.

The group has recognised a charge amounting to £426,180 (2016: £nil) during the year which has been deducted from share premium as the warrants were issued as consideration for professional fees in relation to the issue of shares.

19. Financial instruments

The Group is exposed to the risks that arise from its use of financial instruments. This note describes the objectives, policies and processes of the Group for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

Capital risk management

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising returns to shareholders. In order to maintain or adjust the capital structure, the Group may issue new shares or arrange debt financing. Currently the Group has £nil net debt.

The capital structure of the Group consists of cash and cash equivalents and equity, comprising issued capital and retained losses.

The Group is not subject to any externally imposed capital requirements.

Significant accounting policies

Details of the significant accounting policies and methods adopted including the criteria for recognition, the basis of measurement and the bases for recognition of income and expenses for each class of financial asset, financial liability and equity instrument are disclosed in note 3.

Principal financial instruments

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

· Trade and other receivables

· Cash at bank

· Trade and other payables

Categories of financial instruments

The Group holds the following financial assets: