Last checked at 15 Sep 2023 10:39
Chesterfield Resources PLC / EPIC: CHF / Market: LSE / Sector: Mining
15 September 2023
CHESTERFIELD RESOURCES PLC
("Chesterfield" or the "Company")
Interim Results
Chesterfield Resources PLC, the LSE listed mineral exploration company with projects in Cyprus and Canada, is pleased to announce its interim results for the six months ended 30 June 2023.
Chairman's review of year to date
During the first half of 2023 Chesterfield continued on its policy set out late 2022 which is aimed at restructuring the exploration licence portfolio in both Cyprus and Canada. This work has been carried out with the aim of reducing the need for continual equity dilution while preserving as much as possible shareholder exposure to these licences and their potential value accretion. The announcement in March of the optioning of the Adeline Project in Canada to Sterling Metals in exchange for cash and shares was an important milestone in this restructuring policy. The agreement with Sterling had an immediate beneficial impact on Chesterfield's finances, with the payment by Sterling of CAD$400,000 (£244,000), which constitutes half of the cash payment for the option, with the remainder payable in the event that Sterling opt to acquire the Adeline licences prior to 30 November 2024. This cash was accompanied by 4.5m shares in Sterling which were paid to Chesterfield, with a further 4.5m payable on the same conditions by 30 November 2024. In April, Sterling raised CAD$6.476m (£3.8m) in new equity to fund its exploration plans for the summer and autumn of 2023, with a total of CAD$2.5m (£1.476m) slated for expenditure on drilling and related work at Adeline. Any success at Adeline will be reflected in the value of Sterling shares that Chesterfield holds which in May constituted a 4% stake in the listed Canadian explorer.
Chesterfield rationalised its licence holdings in Cyprus in late 2022, reducing holdings from a total of 26 licences covering 110.42 km2 to 3 licences covering 13.39 km2. The Company has outlined plans for further exploration work on the retained properties. The Board would prefer to work with partners on these promising properties and will update shareholders as and when any formal arrangements are entered into.
During the first half of 2023, the Board has continued to carry out extensive work to examine a number of possible options for the Company to make an investment into new opportunities. The goal is to find a new area of business activity that will generate significant shareholder value in the near term and to announce a new direction in Chesterfield's development by the end of 2023. Shareholders should note that, subject to the terms that may be agreed for these opportunities, additional capital raising or additional shares being issued are possible outcomes of such a change.
An important part of the current overall strategy is cost savings, and the results of our efforts in this area should be clear from the accounts for the period. In addition to the cuts in exploration and related staffing and other overheads, management have been able to significantly reduce outgoings both to service providers and the Board, whose fees have been significantly cut back to £2,500 monthly during the period. With no debts and very low cash outlays, the Company is in a stable financial condition for the foreseeable future, and notwithstanding any further acquisitions or investments should preclude the need for a dilutive capital raise.
Financials
As is to be expected with an exploration company, for the six-month period ended 30 June 2023 the Group is reporting a pre-tax loss of £110,963 (six months ended 30 June 2022: loss of £491,607). The Group's net cash balance as at 30 June 2023 was £348,243 (30 June 2022: £663,226).
Responsibility Statement
We confirm that to the best of our knowledge:
· the interim financial statements have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, as adopted by the UK;
· give a true and fair view of the assets, liabilities, financial position and loss of the Company;
· the Interim report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the set of interim financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
· The Interim report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules, being the information required on related party transactions.
The interim report was approved by the Board of Directors and the above responsibility statement was signed on its behalf by:
Paul Ensor
Executive Chairman
15 September 2023
Market Abuse Regulation (MAR) 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 until the release of this announcement.
For further information please visit www.chesterfieldresourcesplc.com or contact:
Chesterfield Resources plc | Paul Ensor, Executive Chairman | Tel: +44 (0) 7595 219 011 |
First Equity Limited (Broker) | Jason Robertson | Tel: +44 (0)207 330 1183 |
Panmure Gordon (UK) Limited (Broker) | John Prior & Hugh Rich | Tel: +44 (0) 207 886 2500 |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
| Notes | 6 months to 30 June 2023 Unaudited £ | 12 months to 31 December 2022 Audited £ | 6 months to 30 June 2022 Unaudited £ |
Continuing operations | ||||
Revenue | - | - | 45,132 | |
Administration expenses | (148,386) | (855,899) | (536,739) | |
Other Gains | 38,011 | - | - | |
Operating Profit/(Loss) | (110,375) | (855,899) | (491,607) | |
Impairment | - | (3,195,730) | - | |
Finance cost | (588) | (35) | - | |
Other income | - | 45,132 | - | |
Loss before taxation | (110,963) | (4,006,532) | (491,607) | |
Deferred tax credit | - | 347,145 | - | |
Loss for the period |
| (110,963) | (3,659,387) | (491,607) |
Other comprehensive income | ||||
Items that may be reclassified to profit or loss | ||||
Currency translation differences | (39,161) | 97,040 | 137,934 | |
Total other comprehensive income for the period | (39,161) | 97,040 | 137,934 | |
Total comprehensive income for the period attributable to equity holders | (150,124) | (3,562,347) | (353,673) | |
Earnings per share from continuing operations attributable to the equity owners of the parent | ||||
Basic and diluted | 5 | (0.085)p | (2.831)p | (0.384)p |
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
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Notes | As at 30 June 2023 Unaudited £ | As at 31 December 2022 Audited £ | As at 30 June 2022 Unaudited £ |
Non-Current Assets |
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Property, plant and equipment | - | 8,941 | 25,244 | |
Intangible assets | 6 | 894,336 | 880,837 | 5,395,923 |
Available for Sale Investment | 7 | 494,798 | - | - |
1,389,134 | 889,778 | 5,421,167 | ||
Current Assets |
| |||
Trade and other receivables | 143,921 | 162,435 | 375,008 | |
Cash and cash equivalents | 348,243 | 304,022 | 663,226 | |
492,164 | 466,457 | 1,038,234 | ||
Asset held for sale | 8 | 739,143 | 1,478,287 | - |
Total Assets | 2,620,441 | 2,834,522 | 6,459,401 | |
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Non-Current Liabilities |
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Deferred tax liabilities | (33,138) | (33,138) | (380,283) | |
Current Liabilities |
| |||
Trade and other payables | (39,576) | (103,533) | (174,693) | |
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Total Liabilities | (72,714) | (136,671) | (554,976) | |
Net Assets | 2,547,727 | 2,697,851 | 5,904,425 | |
Capital and Reserves Attributable to Equity Holders of the Company |
| |||
Share capital | 228,328 | 228,328 | 228,328 | |
Share premium | 8,919,654 | 8,919,654 | 8,919,654 | |
Other reserves | 186,780 | 257,838 | 298,732 | |
Retained losses | (6,787,035) | (6,707,969) | (3,542,289) | |
Total Equity | 2,547,727 | 2,697,851 | 5,904,425 |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
|
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| Attributable to owners of the Parent |
| ||||
|
| Share capital £ | Share premium £ | Other reserves £ | Retained losses £ | Total equity £ | ||
Balance as at 1 January 2022 |
| 218,328 | 8,253,634 | 160,798 | (3,050,682) | 5,582,078 | ||
Loss for the period | - | - | - | (491,607) | (491,607) | |||
Other comprehensive income for the year |
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Items that may be subsequently reclassified to profit or loss | ||||||||
Currency translation differences | - | - | 137,934 | - | 137,934 | |||
Total comprehensive income for the year |
| - | - | 137,934 | (491,607) | (353,673) | ||
Share issue |
| 10,000 | 690,000 | - | - | 700,000 | ||
Cost of capital |
| - | (23,980) | - | - | (23,980) | ||
Total transactions with owners, recognised in equity |
| 10,000 | 666,020 | - | - | 676,020 | ||
Balance as at 30 June 2022 |
| 228,328 | 8,919,654 | 298,732 | (3,542,289) | 5,904,425 | ||
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Balance as at 1 January 2023 |
| 228,328 | 8,919,654 | 257,838 | (6,707,969) | 2,697,851 | ||
Loss for the period | - | - | - | (110,963) | (110,963) | |||
Other comprehensive income for the year |
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Items that may be subsequently reclassified to profit or loss |
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Currency translation differences | - | - | (39,161) | - | (39,161) | |||
Total comprehensive income for the year |
| - | - | (39,161) | (110,963) | (150,124) | ||
Options expired during the year |
| - | - | (31,897) | 31,897 | - | ||
Total transactions with owners, recognised in equity |
| - | - | (31,897) | 31,897 | - | ||
Balance as at 30 June 2023 |
| 228,328 | 8,919,654 | 186,780 | (6,787,035) | 2,547,727 | ||
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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
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Notes | 6 months to 30 June 2023 Unaudited £ | 6 months to 30 June 2022 Unaudited £ | |
Cash flows from operating activities |
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| ||
Loss before taxation | (110,963) | (491,607) | ||
Adjustments for: | ||||
Depreciation | - | 2,802 | ||
Increase/(decrease) in trade and other receivables | 18,516 | (53,009) | ||
Increase/(decrease) in trade and other payables | (63,962) | 20,310 | ||
Foreign exchange | (6,456) | 24,022 | ||
Net cash used in operations | (162,865) | (497,482) | ||
Cash flows from investing activities | ||||
(Purchase)/Sale of property, plant & equipment | - | (4,324) | ||
Sale of exploration assets | 244,344 | - | ||
Exploration and evaluation activities | 6 | (37,258) | (273,959) | |
Net cash used in investing activities | 207,086 | (278,283) | ||
Cash flows from financing activities |
| |||
Cost of share issue | - | (23,980) | ||
Share issue | - | 700,000 | ||
Net cash generated from financing activities | - | 676,020 | ||
Net decrease in cash and cash equivalents | 44,221 | (99,745) | ||
Cash and cash equivalents at beginning of period | 304,022 | 762,971 | ||
Cash and cash equivalents at end of period | 348,243 | 663,226 |
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. General Information
Chesterfield Resources plc is a minerals company exploring primarily for copper and gold in Canada and Cyprus and listed on the Standard segment of the Main Market of the London Stock Exchange.
The Company is domiciled in the United Kingdom and incorporated and registered in England and Wales, with registration number 10545738. The Company's registered office is 6 Heddon Street, London W1B 4BT.
2. Basis of Preparation
These condensed interim financial statements are for the six months ended 30 June 2023 and have been prepared in accordance with the accounting policies adopted in the Group's most recent annual financial statements for the year ended 31 December 2022.
The Group have chosen to adopt IAS 34 "Interim Financial Reporting" in preparing this interim financial information as adopted by the United Kingdom and the Disclosure and Transparency Rules of the UK Financial Conduct Authority. They do not include all the information required in annual financial statements, and they should be read in conjunction with the consolidated financial statements for the year ended 31 December 2022 and any public announcements made by Chesterfield Resources Plc. during the interim reporting period.
The interim financial information set out above does not constitute statutory accounts within the meaning of the Companies Act 2006. It has been prepared on a going concern basis in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) as adopted by the United Kingdom.
Statutory financial statements for the period ended 31 December 2022 were approved by the Board of Directors on 27 April 2023 and delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified. The condensed interim financial statements are unaudited and have not been reviewed by the Company's auditor.
Going concern
The Directors, having made appropriate enquiries, consider that adequate resources exist for the Company to continue in operational existence for the foreseeable future and that, therefore, it is appropriate to adopt the going concern basis in preparing the condensed interim financial statements for the period ended 30 June 2023.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of the business. The key risks that could affect the Company's medium term performance and the factors that mitigate those risks have not substantially changed from those set out in the Company's 2022 Annual Report and Financial Statements, a copy of which is available on the Company's website: www.chesterfieldplc.com. The key financial risks are liquidity risk, credit risk, interest rate risk and fair value estimation.
Critical accounting estimates
The preparation of condensed interim financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the end of the reporting period. Significant items subject to such estimates are set out in Note 2 of the Company's 2022 Annual Report and Financial Statements. The nature and amounts of such estimates have not changed significantly during the interim period.
3. Accounting Policies
A number of new standards, amendments and became effective on 1 January 2023 and have been adopted by the Group. None of these standards have materially affected the Group.
The same accounting policies, presentation and methods of computation are followed in the interim consolidated financial information as were applied in the Group's latest annual audited financial statements except for those that relate to new standards and interpretations effective for the first time for periods beginning on (or after) 1 January 2023, and will be adopted in the 2023 annual financial statements. In addition to these the following new accounting policies have been adopted:
Assets held for sale
Asset are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell.
4. Dividends
No dividend has been declared or paid by the Company during the six months ended 30 June 2023 (six months ended 30 June 2022: £nil).
5. Loss per Share
The calculation of loss per share is based on a retained loss of £110,963 for the six months ended 30 June 2023 (six months ended 30 June 2022: £491,607) and the weighted average number of shares in issue in the period ended 30 June 2023 of 130,328,311 (six months ended 30 June 2022: 128,173,615).
No diluted earnings per share is presented for the six months ended 30 June 2023 or six months ended 30 June 2022 as the effect on the exercise of share options would be to decrease the loss per share.
6. Intangible assets
The movement in capitalised exploration and evaluation costs during the period was as follows:
Exploration & Evaluation at Cost and Net Book Value | £ |
Balance as at 1 January 2023 | 880,837 |
Additions | 37,258 |
Foreign exchange | (23,759) |
As at 30 June 2023 | 894,336 |
7. Available for sale investment
The movement in available for sale investments during the period was as follows:
Avaliable for sale investments | £ |
Balance as at 1 January 2023 | - |
4,500,000 shares in Sterling Metals | 494,798 |
As at 30 June 2023 | 494,798 |
8. Asset held for sale
On 6th March 2023, the Company announced that they had signed an agreement with Sterling Metals, a TSX-V and OTCQB listed exploration company, with regard to Chesterfield's Adeline project in Labrador. Under the agreement Sterling Metals will purchase an option to acquire full ownership and rights over the project in exchange for a series of payments of cash and shares for a total consideration of CAD$800,000 and 9,000,000 shares in Sterling Metals. Therefore, the Directors have determined that the Adeline licences be classified as an asset held for sale.
Sterling will pay the total cash consideration in three separate tranches. As at 30 June 2023, CAD$400,000 (£244,000) and and 4,500,000 shares have been received by Chesterfield. A final tranche of CAD$400,000 (£230,000) and 4,500,000 shares are to be paid on or before 30 November 2024.
The movement in capitalised exploration and evaluation costs during the period was as follows:
Asset held for sale | £ |
Balance as at 1 January 2023 | 1,478,287 |
Partial sale of Adeline | (739,142) |
As at 30 June 2023 | 739,143 |
The balance of £739,143 is the remaining 50% of Adeline which will be transferred when the final tranche is received by Chesterfield.
9. Events after the balance sheet date
The Directors believe there to be no significant events after the reporting date.
10. Approval of interim financial statements
The Condensed interim financial statements were approved by the Board of Directors on 15 September 2023.
**ENDS**