ROCK Rockfire Resources Plc

The information contained within this announcement is deemed by the Company to constitute inside information pursuant to Article 7 of EU Regulation 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended.

 

31 May 2024

Rockfire Resources plc

("Rockfire" or the "Company")

Annual Results for the year ended 31 December 2023

Rockfire Resources plc (LON: ROCK), the base metal, precious metal, and critical mineral exploration company, announces its audited results for the year ended 31 December 2023.

 

Posting of Annual Report and Notice of AGM

The Company's Annual Report and Financial Statements for the year ended 31 December 2023 will be made available on the Company's website (www.rockfireresources.com) and will be sent to shareholders shortly.

The Company will hold its Annual General Meeting at 5 St Helen's Pl, London EC3A 6AB, United Kingdom on Friday 28th June 2024 at 10:00am and the Notice of Annual General Meeting to that effect will be sent to shareholders shortly and will be available on the Company's website.

For further information on the Company, please visit www.rockfireresources.com or contact the following: 

 

Rockfire Resources plc:	info@rockfire.co.uk
David Price, Chief Executive Officer
Allenby Capital Limited (Nominated Adviser & Broker):	Tel: +44 (0) 20 3328 5656
John Depasquale / George Payne (Corporate Finance)
Guy McDougall / Matt Butlin (Sales and Corporate Broking)

 

Notes to Editors

 

Rockfire Resources plc (LON: ROCK) is a gold, base metal and critical mineral exploration company, with a high-grade zinc/lead/silver/germanium deposit in Greece and a portfolio of gold/copper/silver projects in Queensland Australia.

 

§ The Molaoi deposit in Greece has a JORC Inferred Resource of 2.3 million tonnes @ 11 % ZnEq. for 250,000 tonnes of ZnEq. This resource uses a 4% low-grade cut, with individual elemental grades of 9.4 % Zn, 1.7 % Pb and 47 g/t Ag. This equates to 210,000 tonnes of zinc, 39,000 tonnes of lead and 3.5 million ounces of silver.

 

§ The Plateau deposit in Queensland has a JORC resource of 131,000 ounces of gold and 800,000 ounces of silver, using a 0.5g/t Au cut off. 53,000 of these ounces lie within the top 100m from surface. Plateau is subject to a joint venture with ASX-listed Sunshine Metals Ltd (ASX:SHN).

 

 

 

CHAIRMAN'S STATEMENT

 

The last financial year has provided highs and lows for the Company, including a number of surprising turns of events. Management was disappointed not to have implemented its strategy to acquire a cash-generating business but was, at the same time, thankful to avoid any negative impacts which may have resulted from the completion of the transaction under sanction conditions.

 

Exploration Review

 

The Molaoi base metal and critical mineral project in Greece continued to provide a bright spot for the Company and remains the Company's principal focus. There was important diamond drilling completed during the reporting period, with much of the year's drilling objectives being:

 

·      To confirm the depth to mineralisation throughout the mineralisation model;

·      To confirm the positioning of mineralisation along the length of the mineralised zone;

·      To drill between historical drill holes to confirm the continuity of mineralisation;

·      To drill close to historical drill holes to confirm the grade and width of mineralisation; and

·      To determine the geotechnical parameters of the ore zone with respect to ground integrity, fracture density, rock quality designator values, friability and structure orientation where possible.

 

These outcomes were successful, and management is pleased with the results and continues to be pleased with the on-going progress of the project.

 

Overall, the grades and widths intersected by Rockfire correlate very well with the results anticipated from historical drilling. The confirmation of the positioning, grades, depths, and widths provides encouragement for Rockfire's technical team to rely on the results of historical drilling. This means that most of the historical holes are likely to be included in any future resource estimates and mine planning.

 

A significant milestone was announced to the market on 20 April, when the Greek Government approved the environmental study permit for exploration to occur over the following five years for Molaoi. This decision by the Greek Government was received in swift time and is a clear affirmation of the resolve of the Greek Government to facilitate foreign investment in the mining sector.

 

The Company encountered record-breaking zinc grades at Molaoi, with an interval of 0.2m grading 50.8% Zn being returned from drill hole MO_GTK_003A at 142.7m depth. Overall, MO_GTK_003A has a continuous zinc lode interval of 11.3m @ 9.2% ZnEq. commencing from 141.7m depth (37.3g/t Ag, 1.2% Pb, 8.1% Zn). These intervals are robust and would be expected to be included in planned underground mine designs.

 

Throughout the year, drilling continued to prove the continuity of the zinc mineralisation, as well as the grade and the positioning of the lodes. Despite the trading of Rockfire shares being under suspension for much of this period, the Company continued to release drilling results from Molaoi.

 

Up until 23 August 2023, Rockfire's analysis for germanium failed to detect any elevated germanium. The Company believed this to be highly irregular, given that germanium was identified in historical drill core. The Company's technical team elected to reanalyse the core for germanium using a different analytical method. Instead of using a 4-acid digest, the laboratory was instructed to use lithium borate fusion. This technique successfully detected high-grade germanium associated with zinc.

 

Germanium and gallium are both included on the US and EU lists of critical minerals, owing to geological scarcity. Gallium is included on the UK list of critical minerals. During the latter part of 2023, China announced restrictions on the export supplies of both gallium and germanium products, citing national security reasons. The Ge and Ga grades at Molaoi are expected to add significant further value as a bi-product to the project economics. Germanium traded above US$1.5m per tonne of metal product for most of the year.

 

Each hole drilled by Rockfire has intersected zinc, lead, silver and germanium mineralisation at the anticipated depth, the expected elevation, the calculated average grade, and the precise location modelled by the historical drilling. This is a good sign that the original drilling data can be relied upon and can be used in future feasibility studies and resource upgrades.

 

A farm-in and joint venture agreement was announced to the market on 20 January 2023. Rockfire had entered a new joint venture ("JV") at the Plateau gold deposit in Queensland, Australia. The binding heads of agreement is with Sunshine Gold Limited ("Sunshine"), a company which is listed on the Australian Stock Exchange (ASX:SHN).

 

The JV includes the Lighthouse tenement (EPM25617) and the adjoining Kookaburra tenement (EPM26705) and will result in Sunshine sole-funding exploration at Plateau for the next three years, with funding being engaged on direct exploration activity. Rockfire's intention is to focus its financial, logistical and human resources on the Molaoi zinc deposit in Greece.

 

 

Rockfire has the option to retain 25% ownership of the Plateau gold project by participating in 25% expenditure in on-going exploration, or the Company may elect to convert its right over a 25% share of the tenements to a 1.5% net smelter royalty. With this structure, any discovery success by Sunshine will directly benefit shareholders of Rockfire.

 

Several updates on exploration progress at Lighthouse were provided by Sunshine during the year. At the Plateau, Horse Creek and Cardigan Dam prospects, rock chip sampling returned high grade gold up to 8.35g/t Au and silver up to 116g/t Ag.

 

Field mapping and sampling at Cardigan Dam identified a gossanous breccia. The best rock chip assayed 13.20g/t Au. A new zone of mineralisation was identified and rock sampling returned 9.58g/t Au. Follow-up sampling at Cardigan Dam confirmed a second gossanous zone, where rock chip sampling resulted 59.5g/t Au.

 

Corporate

 

A number of important milestones were announced to the market on 15 September 2023. Foremost of these was the proposed acquisition of Emirates Gold DMCC and Emperesse Bullion LLC (the "Proposed RTO"). This Proposed RTO was part of the Directors' ambitious growth strategy to acquire cash-generating and profitable companies.

 

Due to the Proposed RTO constituting a reverse takeover under the AIM Rules for Companies, the Company's shares were suspended from trading on the AIM Market of the London Stock Exchange on 15 September 2023.

 

Simultaneous to the announcement of the Proposed RTO, the Company raised £3.5 million from two new institutional investors. The successful result of this subscription was announced to the market on 20^th September 2023, with net proceeds to be used for the following purposes:

 

1)    to satisfy the payment of US$2m for the initial consideration for the Proposed RTO;

2)    to contribute towards costs associated with the Proposed RTO;

3)    to continue drilling at the Company's Molaoi zinc, silver, lead and germanium project in Greece; and

4)    to fund the working capital requirements within the Company.

 

Rockfire's management team, financial advisers, consultants, lawyers and accountants were in the process of undertaking a thorough due diligence on the companies to be acquired, as well as preparation of the admission document required to lift the suspension on the Company's shares. However, on 8 November 2023, the Foreign, Commonwealth & Development Office, a department of the Government of the United Kingdom, imposed a sanction on the vendor of Emirates Gold and Emperesse Bullion.

 

Rockfire was unable to complete the Proposed RTO without breaching the sanctions and therefore, on 13 November 2023, the Company announced the termination of the acquisitions of the two companies and the withdrawal from the share purchase agreement. Trading on AIM in the Company's shares was restored on 13 November 2023.

 

I present to you, the Annual Report for Rockfire for the financial year ended 31 December 2023. The year ahead will focus on Molaoi, as well as the evaluation of new business to build the Company, in line with the Board's growth ambitions.

 

Financial review

 

The income statement for the year shows a loss of £1,988,747 (2022: loss £614,329).

 

The Company was pleased to welcome a number of institutional and high net worth shareholders during the year and raised a total of £4.38m. This funding was used for the continuation of drilling at Molaoi, and to appraise and assess the possible acquisitions outlined above. 

 

On 1 June 2023, the Company announced a subscription for 400,000,000 new ordinary shares to be issued to Paloma Precious DMCC. This subscription raised £880,000, before expenses, at a price of 0.22 pence per share.

 

On 20 September 2023, the Company announced that it had successfully raised £3.5m before expenses from two new institutional investors subscribing for 700,000,000 new ordinary shares at a price of 0.5 pence per share. This subscription was at a premium of approximately 36 per cent. to the closing mid-market price of an ordinary share on 14 September 2023 and represented approximately 27.5% of the Company's issued share capital as enlarged by the subscription.

 

 

Material events since the end of 2023

 

On 1 February 2024 the Company confirmed the return of the US$2 million initial consideration which was paid by Rockfire as part of its terminated acquisition of Emirates Gold DMCC and Emperesse Bullion LLC.

 

 

 

 

 

Gordon Hart

Chairman

30 May 2024

 

 

STRATEGIC REPORT

 

CORPORATE

 

The last financial year has provided highs and lows for the Company, including a number of surprising turns of events. Management was disappointed not to have implemented its strategy to acquire a cash-generating business but was, at the same time, thankful to avoid any negative impacts which may have resulted from the completion of the transaction under sanction conditions.

 

On 1 June 2023, the Company announced a subscription for 400,000,000 new ordinary shares to be issued to Paloma Precious DMCC. This subscription raised £880,000, before expenses, at a price of 0.22 pence per share. At the completion of the subscription, Paloma held approximately 21.7 per cent. of the issued share capital of the Company.

 

Rockfire has over 130,000 ounces of gold and over 5 million ounces of silver in JORC resources, with 3.5 million ounces of silver at Molaoi alone. At the time, the Board believed this long-term partnership could be a very logical one, particularly with the increasing demand for silver in the solar energy industry. The proceeds of the subscription were to allow for the commencement of resource upgrade drilling at Molaoi and an updated mineral resource.

 

A number of important milestones were announced to the market on 15 September 2023. Foremost of these was the proposed acquisition of Emirates Gold DMCC and Emperesse Bullion LLC, which are two trading companies registered in the United Arab Emirates. This transaction was part of the Directors' ambitious growth strategy to acquire cash-generating and profitable companies.

 

Due to the Proposed RTO constituting a reverse takeover under the AIM Rules for Companies, the Company's shares were suspended from trading on the AIM Market of the London Stock Exchange on 15 September 2023. 

 

In accordance with rule 14 of the AIM Rules, the acquisition would require application to be made for the enlarged share capital to be readmitted to AIM, the publication of an AIM admission document, and approval by shareholders of the Company at a general meeting.

 

On the signing of a share purchase agreement, Rockfire paid USD$2 million in cash to acquire 10% of both Emirates and Emperesse. Rockfire conditionally agreed to acquire the remaining shares in the two companies, which were to be transferred to Rockfire on final completion of the transaction.

 

On the same day (15 September 2023), the Company also announced that it proposed to raise £3.5 million before expenses, from two new institutional investors subscribing for 700,000,000 new ordinary shares at a price of 0.5 pence per share. This subscription was at a premium of approximately 36 per cent. to the closing mid-market price of an ordinary share on 14 September 2023 and represented approximately 27.5% of the Company's issued share capital as enlarged by the subscription.

 

The successful result of the subscription was announced to the market on 20 September 2023, whereby the Company successfully raised £3.5 million before expenses, through two new institutional investors subscribing for 700,000,000 new ordinary shares at a price of 0.5 pence per share.

 

The net proceeds of the subscription were to be used for:

1)    to satisfy the payment of US$2m for the initial consideration for the acquisitions;

2)    to contribute towards costs associated with the transaction;

3)    to continue drilling at the Company's Molaoi zinc, silver, lead and germanium project in Greece; and

4)    to fund the working capital requirements within the Company.

 

Paloma Precious DMCC notified the Company via a TR-1 form that it had sold 400,000,000 ordinary shares in an off-market transaction at a price of 0.5 pence per share. This disposal was announced to the market on 22 September 2023 and following the disposal, Paloma held no interest in Rockfire's issued share capital.

 

Rockfire's management team and its advisers were in the process of undertaking a thorough due diligence on the companies to be acquired, as well as preparation of the admission document required for the RTO. This due diligence involved two law firms in London, two legal firms in Dubai, the Company's accountants, an audit firm, Rockfire's nominated advisor and broker, as well as multiple departments within the government of the UAE.

 

On 8 November 2023, the Foreign, Commonwealth & Development Office, a department of the Government of the United Kingdom, imposed sanctions on Paloma Precious DMCC and 28 other individuals and entities. Rockfire immediately sought legal advice regarding the Proposed RTO. The conclusion from this advice was that Rockfire was unable to complete the transaction without breaching the sanctions and therefore, on 13 November 2023, the Company announced the termination of the acquisition of the two companies and the withdrawal from the share purchase agreement.

 

Following the termination of the transaction, Trading on AIM in the Company's shares was restored on 13 November 2023.

 

Rockfire announced to the market on 4 December 2023, that is had made application to the UK Government's Office of Financial Sanctions Implementation ("OFSI") for authority to recover the US$2 million consideration which Rockfire paid as the initial consideration for the acquisition of Emirates and Emperesse. This application was subsequently approved by the OFSI and announced to the market on 1 February 2024, that Rockfire received the US$2m into its bank account.

 

Molaoi Zinc Project, Greece

 

The Molaoi project continues to advance, with significant and important diamond drilling completed during the reporting period. Rockfire, through its 100%-owned subsidiary, Hellenic Minerals S.A. completed a total of seven geotechnical drill holes. These holes were designed for the following outcomes:

 

·      To confirm the depth to mineralisation throughout the mineralisation model;

·      To confirm the positioning of mineralisation along the length of the mineralised zone;

·      To drill between historical drill holes to confirm the continuity of mineralisation;

·      To drill close to historical drill holes to confirm the grade and width of mineralisation; and

·      To determine the geotechnical parameters of the ore zone with respect to ground integrity, fracture density, rock quality designator values, friability and structure orientation where possible.

 

These outcomes were successful, and management is pleased with the results. The ground conditions are very poor above the mineralisation and significant ground support is anticipated when mining commences. Owing to poor ground conditions, the preferred access to the ore body is expected to be a shaft, rather than a decline. This will minimise the amount of development in unstable ground.

 

Overall, the grades and widths intersected by Rockfire correlate very well with the results anticipated from historical drilling. The confirmation of the positioning, grades, depths, and widths provides enormous encouragement for Rockfire's technical team to rely on the results of historical drilling. This means that most of the historical holes are likely to be included in any future resource estimates and mine planning.

 

The year commenced well when on 23 January 2023, the Company announced the first assay results from hole MO_GTK_001. This hole confirmed that Molaoi comprises multiple lodes, and perhaps as many as four stacked, high-grade lodes. Best results included:

 

·      13.4% ZnEq. over 7.18m width, from 130.62m (11.3% Zn, 1.4% Pb and 50g/t Ag).

·      15.6% ZnEq. over 0.17m width, from 142.60m (14.3% Zn, 0.5% Pb and 41.80g/t Ag).

·      10.7% ZnEq. over 1.73m width, from 144.90m (8.3% Zn, 1.3% Pb and 62g/t Ag).

·      19.5% ZnEq. over 2.24 m width, from 161.10m (16.6% Zn, 3.1% Pb and 36g/t Ag).

 

Overall, the main, second and third lodes comprise a broad mineralised zone with an intersection of 7.5% ZnEq. over 16m width, from 130.62m (6.2% Zn, 0.8% Pb and 31 g/t Ag). The highest individual samples obtained were 20.5% Zn and 93.4g/t Ag over 1.25m (from 132.15m depth) and 4.1% Pb over 1.0m (from 161.10m).

 

Further high grades were announced on 4 April 2023, when hole MO_GTK_002 results were released to the market. High-grade individual zinc values up to 19.7% Zn over 0.4m width were found to occur from 108.40m depth. Individual peak silver values are up to 94.2g/t Ag, and individual peak lead values are up to 2.5% Pb. An overall width of 2.4m recorded an average grade of 5.8% ZnEq., from 106.94m (5.4% Zn, 0.6% Pb and 17.8g/t Ag). Results continue to confirm the location, continuity, and high-grade nature of the zinc resource. Potentially economic zinc grades continue to occur over widths deemed suitable for mechanised underground mining. The close association of zinc, silver and lead continues to be demonstrated.

 

A milestone was announced to the market on 20 April 2023, when the Greek Government approved the environmental study permit for exploration to occur over the following 5 years for Molaoi. This decision by the Greek Government was received in swift time and is a clear affirmation of the resolve of the Greek Government to facilitate foreign investment in the mining sector.

 

On 26 May 2023, the Company released record-breaking zinc grades at Molaoi, with an interval of 0.2m grading 50.8% Zn being returned from drill hole MO_GTK_003A at 142.7m depth. This result is immediately followed by a second interval of 0.7m grading 43.2% Zn. This lens of record-breaking grade averages 36% ZnEq. over a 1.42m total length (127.5g/t Ag, 2.7% Pb, 33.6% Zn) and represents the highest grades encountered at Molaoi so far, from 180 drill holes already drilled. This very high-grade interval occurs within a broader, high-grade zone of 4.85m @ 14.6% ZnEq. (58.3g/t Ag, 1.9%Pb, 12.97% Zn). A lower, footwall lode was encountered from 150.5m depth, grading 11.7% ZnEq. over a width of 2.5m (49.1g/t Ag, 1.6% Pb, 10.2% Zn). Overall, MO_GTK_003A has a continuous zinc lode interval of 11.3m @ 9.2% ZnEq. commencing from 141.7m depth (37.3g/t Ag, 1.2%Pb 8.1% Zn).

 

Throughout the year, drilling continued to prove the continuity of the zinc mineralisation as well as the grade and the positioning of the lodes. Further high-grade drilling results were released on 13 June 2023, including results from Hole MO_GTK_004, with an upper lode of 2.37m @ 6.0% Zn occurring from 107m, along with 0.8% Pb and 31.3g/t Ag. A lower lode of 2.3m @ 5.3% Zn was also encountered from 110m, with 1.3% Pb and 13.6g/t Ag. Individual peak zinc values up to 17.6% Zn, 3.0% Pb and 91.8g/t Ag were recorded in this hole.

 

Results from drill hole MO_GTK_005 were released to the market on 19 July 2023. These results included an upper lode of 2.40m @ 5.5% ZnEq. from 81m (4.7% Zn, 21.9g/t Ag, 0.9% Pb) and a main lode, comprising 3.5m @ 7.3% ZnEq. This occurs within a broader zone of 3.96m @ 6.6% ZnEq., starting from 87.94m. Individual peak zinc values are up to 29.8% Zn, 3.3% Pb and 204.0g/t Ag.

 

Despite the trading of Rockfire shares being under suspension for much of this period, the Company continued to release drilling results from Molaoi. Drill hole MO_GTK_006 returned an excellent interval of 3.3m @ 22.1% ZnEq. (17.1% Zn, 1.9% Pb and 100.4g/t Ag), as announced on 1 August 2023. The interval quoted above lies within a broader interval of 5.8m @ 13.6% ZnEq. (10.5% Zn, 1.2% Pb and 61.1g/t Ag), which commences at 75.20m depth. The highest individual assay is just under 1m wide (0.94m), and grades 34.0% Zn, 4.1% Pb and 252.0g/t Ag. Results from hole MO_GTK_007 were released in the same RNS, informing the market that this hole was terminated early due to badly fractured and broken ground. Despite the early termination of the hole, an interval of 1.95m grading 3.0% ZnEq. was intersected. It is expected that this hole will be redrilled later to intersect the main lode deeper.

 

During all this time and up until 23 August 2023, Rockfire's analysis for germanium in holes MO_GTK_001 through to hole MO_GTK_007 failed to detect any elevated germanium. The Company believed this to be highly irregular, given that germanium was identified in historical drill core. The Company's technical team elected to reanalyse the core for germanium using a different analytical method. Instead of using a 4-acid digest, the laboratory was instructed to use lithium borate fusion. This technique successfully detected germanium associated with the high-grade zinc.

 

Germanium grades between 9.0 and 40.0 g/t were returned from the reanalysis, with an average from seven holes of 23.7 g/t Ge over an average downhole intersection of 4.6 metres. The highest individual germanium assay recorded was 73.8g/t Ge in hole MO_GTK_003A. Gallium grades between 9.7 and 19.0 g/t were detected, with an average of 15.3 g/t Ga over an average downhole intersection of 4.6 metres, with the highest individual gallium assay being 33.3g/t Ga in hole MO_GTK_003A.

 

Germanium and gallium are both included on the US and EU lists of critical minerals, owing to geological scarcity. Gallium is included on the UK list of critical minerals. China recently announced restrictions on the export supplies of both gallium and germanium products, citing national security reasons. The high Ge and Ga grades at Molaoi are expected to add significant further value to the project economics.

 

On 3 October 2023, the Company announced the commencement of a five-hole drilling programme, which was designed to replicate several historical drill holes. Successful replication of the historical holes would establish a high confidence in the positioning of those holes. Increased confidence in the positioning of historical holes is expected to enable inferred resources to convert to indicated resources, which can then be used in future feasibility studies.

 

Lighthouse, Queensland Australia

 

A strategically important joint venture was announced to the market on 20 January 2023. Rockfire had entered a new joint venture ("JV") at the Plateau gold deposit in Queensland, Australia. The purpose of the JV was to test regional targets, as well as the discovery of higher-grade gold, close to Rockfire's JORC resource. The binding heads of agreement is with Sunshine Gold Limited ("Sunshine"), a company which is listed on the Australian Stock Exchange (ASX:SHN).

 

The JV includes the Lighthouse tenement (EPM25617) and the adjoining Kookaburra tenement (EPM26705) and will result in Sunshine sole-funding exploration at Plateau for the next three years, with funding being engaged on direct exploration activity. Rockfire's intention is to focus its financial, logistical and human resources on the Molaoi zinc deposit in Greece.

 

Exploration by Sunshine will target regional prospects in the Lighthouse tenement, including Double Event, Cardigan Dam, Bluff Creek, Bullseye, Rollston River, Warrawee, Lower Lighthouse and Horse Creek, aiming to delineate near-surface resources at each of these regional prospects.

 

Rockfire has the option to retain 25% ownership of the Plateau gold project by participating in 25% expenditure in on-going exploration, or the Company may elect to convert its right over a 25% share of the tenements to a 1.5% net smelter royalty. With this structure, any discovery success by Sunshine will directly benefit shareholders of Rockfire.

 

An update of activities at the Lighthouse project was provided by Sunshine on 14 March 2023. At the Plateau prospect, two rock chips returned 7.46g/t Au, 116g/t Ag, 0.50% Ba, 0.16% V2O5 and 1.53g/t Au, 8.35g/t Ag, 0.74% Pb, 0.44% Zn. Rock samples from Cardigan Dam assayed 8.35g/t Au, 32.8g/t Ag, 0.28% Cu, 0.13% Co, 1.0% Ba. At Horse Creek, a prospect immediately north of Plateau, a rock chip assayed 1.1% Ni, 0.27% Cr, 0.12g/t Au, 0.75g/t Pt, 0.45g/t Pd, 0.05% Co.

 

Several updates on exploration progress at Lighthouse were provided by Sunshine during the year. On 6 April 2023, it was announced that field mapping and sampling over a previously identified 300m ridge of gold anomalism at Cardigan Dam identified a gossanous breccia. The best rock chip assayed 13.20g/t Au and 4.8g/t Ag. A new zone of mineralisation was identified approximately 500m south of the gossanous ridge and rock sampling returned 9.58g/t Au and 9.9g/t Ag. A single rock chip returned elevated cobalt and copper over a strong magnetic anomaly, approximately 250m northeast of the gossanous ridge, returning 0.62% Co, 0.48% Cu, 0.92% Ba and 185ppm Ni. The discovery of an elevated cobalt sample is an interesting discovery, particularly with the increasing demand for cobalt. Cobalt is used in large quantities in battery storage of energy and the supply of cobalt as a raw material for future energy storage is a growing and important industry.

 

On 12 September 2023, Sunshine released an announcement notifying that a rock chip from the main gossan at Cardigan Dam assayed 8.35g/t Au, 32.8g/t Ag, 0.28% Cu and 0.13% Co. Further mapping and sampling at Cardigan Dam had confirmed a second gossanous zone, where rock chip sampling resulted 59.5g/t Au and 41g/t Ag. Gold up to 1.68g/t Au and 415g/t Ag was returned from a ~700m x 600m area at Cardigan Dam breccia pipe.

 

Sunshine announced on 15 November 2023 that it had commenced drilling at Lighthouse. Three holes (23PLRC_Prop_001, 002, 004) were expected to target the northeast contact of the main diorite at Plateau, in a sparsely drilled location. Hole 23PLRC_Prop_003 was designed to test a structure coming off the northeast contact and trending eastward and a third hole, 23PLRC_Prop_007 targeted a zone of elevated gold-in-rocks, which includes a Rockfire sample assaying 6.96g/t Au and validated by Sunshine with a value of 7.46g/t Au.

 

Five drill holes (23CDRC_Prop_001 - 004; and CD23_Prop_010) were being proposed at Cardigan Dam West and designed to target the main gossan and its eastern extension. Holes 001-003 were to target the central part of the surface anomalism, which trends northwest. Hole 010 was proposed to target a mapped east-west trending breccia zone, believed to be the eastern extension of the main gossan structure. One hole, (23CDRC_Prop_004) is expected to test a northwest-trending lineament which has returned rock chips up to 59.5g/t Au.

 

One drill hole (23HCRC_Prop_001) was being planned to target immediately below a nickel-in-rock assay at Horse Creek Prospect, which lies approximately 750m northeast of Plateau.

 

Qualified Person Statement

 

The technical information present is based on information compiled by Mr David Price, the Chief Executive Officer of Rockfire Resources plc, who is a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM). Mr Price has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which has been undertaken to qualify as a "Qualified Person" in accordance with the AIM Rules Guidance Note for Mining and Oil & Gas Companies. Mr Price consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears.

 

 

KEY PERFORMANCE INDICATORS (KPIs)

 

The Board monitors KPIs, which it considers appropriate for a group at Rockfire's stage of development.

 

Financial KPIs

 

During the year, the Board monitored the following KPIs:

 

·      Cash flow and working capital.

 

RISK MANAGEMENT

 

The Board regularly reviews the risks to which the Group is exposed and ensures through its meetings and regular reporting that these risks are minimised as far as possible.

 

The principal risks and uncertainties facing the Group at this stage in its development are:

Risk of Sanction

 

During 2023, Rockfire was exposed to a potential risk of sanction. The owner of two companies being acquired by Rockfire in the United Arab Emirates ("UAE") was sanctioned by the United Kingdom Government during the course of the acquisition process.

 

On learning of the sanctions being imposed on the seller of the assets, Rockfire immediately sought legal opinion. That opinion was that the acquisition could not proceed without breaching the sanctions. On receiving this advice, Rockfire immediately withdrew from the share purchase agreement and discontinued its acquisition of the two companies in the UAE.

 

Rockfire has developed a new sanctions policy to assist with the avoidance of exposure to sanction risk, as well as to manage any exposure to risk in the future.

 

Money-laundering risk

 

The procedure for dealing with the risk of money-laundering has been put in place by Rockfire management. Rockfire has developed a new anti money-laundering policy to assist with the avoidance of exposure to such risk, as well as to manage any exposure to risk in the future.

 

Exploration risk

 

The Group's business has been primarily mineral exploration and evaluation which are speculative activities and whilst the Directors are satisfied that good progress is being made, there is no certainty that the Group will be successful in the definition of economic mineral deposits, or that it will proceed to the development of any of its projects or otherwise realise their value.

 

The Group aims to mitigate this risk when evaluating new business opportunities by targeting areas of potential where there is at least some successful historical drilling or geological data available.

 

Resource risk

 

All mineral projects have risk associated with defined grade and continuity. Mineral reserves and resources are calculated by the Group in accordance with accepted industry standards and codes but are always subject to uncertainties in the underlying assumptions which include geological projection and commodity price assumptions.

The Group reports mineral resources and reserves in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves ('the JORC Code'). The JORC Code is a professional code of practice that sets minimum standards for public reporting of mineral exploration results, mineral resources and ore reserves. Further information on the JORC Code can be found at www.jorc.org.

 

Environmental, landowner and native title risk

 

Exploration and development of a project can be adversely affected by environmental legislation and the unforeseen results of environmental studies carried out during evaluation of a project. Once a project is in production, unforeseen events can give rise to environmental liabilities.

 

Access and compensation agreements are required to be negotiated between the Company and the landowner at each project. Greek legislation provides an agreement template which may be modified by the Company and the landowner. The Company cannot guarantee landowners will provide access, regardless of existing laws in place to ensure such access is negotiated on fair terms.

 

The Group is currently in the exploration stage. Any disturbance to the environment during this phase is minimal and is rehabilitated in accordance with the prevailing regulations of the countries in which we operate.

 

Financing and liquidity risk

 

The Group has an ongoing requirement to fund its activities through the equity markets and in the future to obtain finance for project development. There is no certainty such funds will be available when needed. To date, Rockfire has managed to raise funds primarily through equity placements despite the very difficult markets that currently exist for raising funding in the junior mining industry.

 

Political risk

 

All countries carry political risk that can lead to interruption of activity. Politically stable countries can have enhanced environmental and social permitting risks, risks of strikes and changes to taxation whereas less developed countries can have in addition, risks associated with changes to the legal framework, civil unrest and government expropriation of assets.

 

Bribery risk

 

The Group has adopted an anti-corruption policy and whistle blowing policy under the Bribery Act 2010. Notwithstanding this, the Group may be held liable for offences under that Act committed by its employees or subcontractors, whether or not the Group or the Directors had knowledge of the committing of such offences.

 

Insurance coverage

 

The Group maintains a suite of insurance coverage that is appropriate for the Group and Company. This is arranged via a specialist mining insurance broker and coverage includes public and products liability, corporate and professional, travel, property and medical coverage and assistance while Group employees and consultants are travelling on Group business. This is reviewed at least annually and adapted as the Group's scale and nature of activities changes.

 

Internal controls and risk management

 

The Directors are responsible for the Group's system of internal financial control. Although no system of internal financial control can provide absolute assurance against material misstatement or loss, the Group's system is designed to provide reasonable assurance that problems are identified on a timely basis and dealt with appropriately.

 

In carrying out their responsibilities, the Directors have put in place a framework of controls to ensure as far as possible that ongoing financial performance is monitored in a timely manner, that corrective action is taken and that risk is identified as early as practically possible. The Directors review the effectiveness of internal financial control at least annually.

 

The Board continuously monitors and upgrades its internal control procedures and risk management mechanisms and assesses both for effectiveness during the annual review. This process enables the Board to determine if the risk exposure has changed during the year.  The Company has a risk management policy, which is reviewed annually. The Executive Directors report regularly to the Board on the management of material business risks.

 

The Board, subject to delegated authority, reviews capital investment, property sales and purchases, additional borrowing facilities, guarantees and insurance arrangements.

 

CORPORATE SOCIAL RESPONSIBILITY

 

The Board takes account of the significance of social, environmental and ethical matters affecting the business of the Group. At this stage in the Group's development the Board has not adopted a specific policy on corporate social responsibility as it has a limited pool of stakeholders other than its shareholders. Rather, the Board seeks to protect the interests of Rockfire's stakeholders through individual policies and through ethical and transparent actions.

 

SHAREHOLDERS

 

The Directors are always prepared, where practicable, to enter into dialogue with shareholders to promote a mutual understanding of objectives and outcomes. The Annual General Meeting provides the Board with an opportunity to informally meet and communicate directly with investors.

 

ENVIRONMENT

 

The Board recognises that the Group's principal activity, mineral exploration, has the potential to impact on the local environment. To date, activities at the various projects have been limited to surveying and drilling activities and the Group does comply with local regulatory requirements with regard to environmental compliance and rehabilitation. The impact on the environment of the Group's activities has the potential to increase should our projects move into a development or production phase. This is currently assessed through baseline environmental studies that are being undertaken and identifying resources needed to manage environmental compliance in the future.

 

Given the Group's size and scale it is not considered practical or cost effective to collect and report data on carbon emissions.

 

 

 

 

EMPLOYEES

 

The Group engages its employees to understand all aspects of the Group's business and seeks to remunerate its employees fairly, being flexible where practicable. The Group gives full and fair consideration to applications for employment received regardless of age, gender, colour, ethnicity, disability, nationality, religious beliefs, transgender status or sexual orientation. The Group takes account of employees' interests when making decisions and welcomes suggestions from employees aimed at improving the Group's performance.

 

The Group now operates in Greece and Australia where it recruits locally as many of its employees and contractors as practicable.

 

SUPPLIERS AND CONTRACTORS

 

The Group recognises that the goodwill of its contractors, consultants and suppliers is important to its business success and seeks to build and maintain this goodwill through fair dealings. The Group has a prompt payment policy and seeks to settle all agreed liabilities within the terms agreed with suppliers. The Company encourages best practice from suppliers and contractors with regards to environmental issues.

 

HEALTH AND SAFETY

 

The Board recognises that it has a responsibility to provide strategic leadership and direction in the development of the Group's health and safety strategy in order to protect all of its stakeholders. The Group does not have a formal health and safety policy at this time. This is re-evaluated as and when the Group's nature and scale of activities change.

 

ENGAGEMENT WITH STAKEHOLDERS

 

The Board of Rockfire is proud of the high standard of corporate governance it has established and maintains. The Board makes a conscious effort to understand the interests and expectations of the Company's stakeholders, and to reflect these in the choices it makes in its effort to create long-term sustainable success for our business.

 

Engagement with our shareholders and wider stakeholder groups, including employees, landowners, suppliers, contractors and government agencies, plays a central role throughout Rockfire's business. The Board is aware that each stakeholder group requires a specific and unique engagement approach in order to create and maintain effective, sustainable and mutually beneficial relationships.

 

The Board's understanding of various stakeholder interests is factored into programme planning, boardroom discussions, strategy and budgets to assess potential long-term impacts of our business on each group, and how we might best address stakeholder expectations from our business.

 

Throughout this Annual Report, we provide examples of how we:

 

·      Take into account the likely consequences of long-term decisions;

·      Foster relationships with stakeholders;

·      Understand our impact on our local communities and the environment; and

·      Demonstrate the importance of behaving responsibly.

 

This engagement with stakeholders section forms our section 172 statement and should be read in conjunction with other information included in this Annual Report. Section 172 of the Companies Act 2006 requires the Directors to act in a way that they consider, in good faith, would most likely promote the success of the Company for the benefit of its members as a whole, taking into account the factors listed in section 172.

 

The Directors continue to observe, plan for, and communicate the interests of the Company's stakeholders, including the impact of its exploration activities on local communities and the environment. Acting in good faith and fairly between members, the Directors consider what is most likely to promote the success of the Company for its members in the long term.

 

The Board regularly reviews its principal stakeholders and how it engages with each. Stakeholder expectations are brought into the boardroom throughout the annual cycle through information provided by management and by direct engagement with stakeholders themselves. The priority of each stakeholder group may increase or decrease, depending on the degree of impact any decision may have on any particular stakeholder group. The Board therefore seeks to consider the impact and priorities of each stakeholder group during its discussions and as part of its decision making.

 

The table below sets out the key stakeholder groups, their interests and how Rockfire has engaged with them over the reporting period. However, given the importance of stakeholder focus, long-term strategy and reputation, these themes are also discussed throughout this Annual Report.

 

Stakeholder	Their interests	How we engage
Our investors	·       Comprehensive review of financial performance of the business ·       Business sustainability ·       High standard of governance ·       Success of the business ·       Ethical behaviour ·       Director experience ·       Awareness of long-term strategy and direction ·       Project prospectivity ·       Improving market perception of the business	·       Annual Report ·       Company website ·       Shareholder circulars ·       Podcasts and interviews ·       Corporate information including Company announcements and presentations ·       AGM results ·       Conference presentations ·       Stock exchange announcements ·       Press releases ·       Appointment of a public relations advisor ·       Frequent communication through briefings with management ·       Shareholder communication policy, which is renewed annually ·       Specific shareholder liaison officer on the Board (Chief Executive Officer) ·       Social media ·       One- to- one meetings with large existing or potential new shareholders
Regulatory bodies	·       Compliance with regulations ·       Worker pay and conditions ·       Health and safety ·       Brand reputation ·       Waste and environment ·       Insurance ·       Environmental protection	·       Company website ·       Stock Exchange announcements ·       Interim and Annual Report ·       Regular contact with QCA, share registrar, LSE and Companies House  ·       Compliance updates at Board meetings ·       Risk management policy, updated annually ·       Compliance with local regulatory requirements and industry standard principles for environmental and social risk management ·       Appointment of a nominated advisor in accordance with the AIM Rules ·       Appointment of a competent person in accordance with the AIM Rules ·       Adhere to Australian and Greek laws and regulations ·       Adoption of best practice policies recommended by the World Bank and The International Council on Mining and Metals
Community	·       Sustainability ·       Human rights ·       Community outreach	·       Philanthropy. Drilling of a water bore is offered to the landowner during each drill programme ·       Corporate responsibility is overseen by a dedicated exploration manager ·       Employment of local contractors wherever possible ·       Prompt rehabilitation of drill sites ·       Providing opportunity for local businesses to cater for our exploration programs ·       Local landowners are paid promptly ·       Landowner access and compensation agreements ·       Active communication with landowners and communities where field work is taking place ·       Adhere to Queensland Government guidelines for approaching landowner and native title holder discussion
Environment	·       Energy usage ·       Recycling ·       Waste management	·       All operational waste is completely removed from site and taken to a waste and/or recycling facility ·       Detailed field operation guidelines to minimise any negative environmental impact of exploration activities ·       Obtaining environmental permits for exploration works in Greece and Australia, granted by the relevant  government ·       Ensuring operational protocols are in place and monitoring the adherence to those protocols
Suppliers	·       Terms and conditions of contract ·       Procurement opportunities ·       Workers' rights ·       Supplier engagement ·       Sustainability ·       Long-term partnerships ·       Fair trading and payment terms	·       All supplies are sourced locally where possible ·       Our suppliers and contractors have received repeat business from Rockfire, which is testimony to the fine working relationship established ·       Supplier performance is continually monitored by a dedicated exploration manager ·       All field programs, including supplier quotes are authorised by the Executive Directors prior to implementation ·       Local suppliers are paid promptly ·       Contact and feedback to suppliers is regular and personal via a dedicated exploration manager
Contractors	·       Terms and conditions of contract ·       Health and safety ·       Human rights and modern slavery ·       Working conditions ·       Diversity and inclusion	·       All contractors are sourced locally where possible ·       Contractors are trained in senior first aid, paid for by Rockfire ·       On-the-job training is provided ·       Local contractors are paid promptly ·       Rockfire pays contractors standard industry rates, which are well in excess of minimum average wages ·       Communication with contractors is frequent through a dedicated exploration manager ·       Induction for health and safety is mandatory for contractors visiting site ·       Daily safety meetings have been implemented during all field operations ·       Rockfire has a whistle-blower policy and procedure in place to ensure compliance, safety and governance ·       Code of conduct providing a framework for ethical decision making ·       Contact and feedback to contractors is regular and personal via a dedicated exploration manager ·       Anti-corruption and bribery policy

 

On behalf of the Board

 

 

 

 

David Price

Chief Executive Officer

30 May 2024

 

 

DIRECTORS' REPORT

 

 

Principal activities

 

The principal activities of the Group are currently exploration for base metals and critical minerals in Greece, as well as gold and copper resources in Australia. The Group's strategy is to explore for and, where the Directors believe that it is commercially feasible, develop deposits of base metals, precious metals and critical minerals. The Company strategy includes considering opportunities for project sale or joint venture at a point when any of the Group's projects becomes appropriately advanced enough to consider such options.

 

The Group currently holds one exploration and exploitation licence in Greece, and five exploration permits for minerals in Queensland, Australia.

 

Financial overview

 

The loss for the year is higher than anticipated owing to the unsuccessful acquisition of Emirates Gold DMCC and Emperesse Bullion DMCC. The Directors are confident that they will be able to secure additional funding when required. The Directors are also of the view that the investment sentiment in the resource sector is currently slow, but improving, to the extent that the exploration success the Company has achieved to date should enable it to raise sufficient additional exploration funding to continue its exploration programmes.

 

Further details of the Group's business, including its targets and strategies is given in the Chairman's Statement and the Strategic Report.

 

Major events after the reporting period

 

For information regarding events after the reporting date, see note 21 to the financial statements.

 

Dividends

 

The Directors are unable to recommend the payment of a dividend for the year ended 31 December 2023 (2022: £nil).

 

Going concern 

 

The Board believes the Group will generate sufficient working capital to continue in operational existence and will have the ongoing support of its shareholders, as required, for the foreseeable future. Refer to the going concern accounting policy note for more detail.

 

Directors

 

The Directors in office during the year are listed below. The interests of the Directors in the shares of the Company, and share options were as follows:

 

	As at 31 December 2023 Ordinary shares	As at 31 December 2022 Ordinary shares	As at 31 December 2023 Options	As at 31 December 2022 Options
Gordon Hart	18,423,530	14,423,530	10,000,000	10,000,000
Patrick Elliott	55,594,744	40,042,765	-	6,000,000
Ian Staunton	-	-	-	6,000,000
Nicholas Walley	75,200,000	75,200,000	-	6,000,000
David W Price	46,350,000	46,350,000	10,000,000	10,000,000

 

 

Significant shareholdings

 

As at 15 May 2024, being the latest practical date prior to publication of this document, the Company was aware of the following holdings of 3% or more of the issued share capital of the Company:

 

	Ordinary shares	% of the Company's issued share capital
Rostra Holdings	480,000,000	18.78%
TPM Middle East Dubai	312,000,000	12.21%
The Wonderful Group	308,000,000	12.05%

 

Directors' remuneration

 

Full details of Directors' emoluments are set out in note 5 to the financial statements.

 

Environmental policy

 

The Group's projects are subject to the relevant Greek and Australian laws and regulations relating to environmental matters.

 

The Group's strategy is to explore for and, where the relevant studies indicate that it is economically viable to do so, to develop mineral deposits. It is the Group's intention to conduct its exploration and investigation activities in a professional and responsible manner, for the benefit of the Company's shareholders, its employees and the national and local communities within which it operates.

 

The Group aims, at all times, to conduct its operations in an environmentally responsible manner and in accordance with relevant legislation. The Group aims to adopt best practice policies as recommended by the World Bank, the International Council on Mining & Metals ("ICMM") and others where the Group deems local legislation to be inadequate in terms of environmental protection. The Group has in place a detailed field operations guidelines manual which covers in considerable detail the measures to be taken by field personnel to minimise any negative environmental impact of current exploration activities on the environment.

 

The Group also recognises the enormous potential of its activities for positive impact on the communities in which it operates and strives to optimise these positive impacts as far as possible.

 

Directors' indemnities

 

The Group has directors and officers' indemnity insurance to cover its Directors and officers against the costs of defending themselves in legal proceedings taken against them in that capacity and in respect of any damages resulting from those proceedings.

 

Political contributions

 

No political contributions have been made.

 

Auditor

A resolution proposing that PKF Littlejohn LLP be re-appointed will be put to the forthcoming Annual General Meeting.

 

Statement of disclosure to auditor

 

The Directors who held office at the date of approval of this Annual Report confirm that, so far as they are each aware, there is no relevant audit information of which the Company's auditor is unaware and each Director has taken all steps that he ought to have taken as a Director in order to make himself aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

 

Statement of Directors' responsibilities

 

The Directors are responsible for preparing the Strategic Report, the Director's Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the Group and Company financial statements in accordance with UK-adopted international accounting standards and as regards the Company financial statements, as applied in accordance with the requirements of the Companies Act 2006.

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group and Company for that period.

 

In preparing the Group and Company financial statements, the Directors are required to:

 

·      select suitable accounting policies and then apply them consistently;

·      make judgements and accounting estimates that are reasonable and prudent;

·      state whether they comply with UK-adopted international accounting standards, subject to any material departures disclosed and explained in the financial statements; and

·      prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business.

 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

The Group's Annual Report will be published on the Group's website and in this regard the Directors accept responsibility for the maintenance and integrity of the website.

 

Annual General Meeting and recommendation

 

The Board considers that the resolutions to be proposed at the Annual General Meeting are in the best interests of the Company and the Group as a whole and its unanimous recommendation is that shareholders support these proposals as the Directors intend to do in respect of their own holdings. Further details regarding the location and timing of the Company's forthcoming Annual General Meeting will be provided shortly.

 

We thank you for your continuing support of Rockfire and welcome you to remain a shareholder as we strive to build Rockfire into a cash-positive company.

 

On behalf of the Board

 

 

David Price, Chief Executive Officer

30 May 2024

 

INDEPENDENT AUDITOR'S REPORT

 

Opinion

We have audited the financial statements of Rockfire Resources Plc (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Statement of Comprehensive Income, the Consolidated and Parent Company Statements of Financial Position, the Consolidated and Parent Company Statements of Changes in Equity, the Consolidated and Parent Company Statements of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards and as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

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 2023 and of the group's loss for the year then ended;

·      the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards;

·      the parent company financial statements have been properly prepared in accordance with UK-adopted international accounting standards 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.

Material uncertainty related to going concern

We draw attention to note 3 in the financial statements, which indicates that the group will require further funds to be raised over the next 12 months in order for the group to meet its exploration expenditure commitments, undertake the budgeted exploration activities and progress new business development opportunities. As stated in note 3, these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the group's and parent company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the group's and parent company's ability to continue to adopt the going concern basis of accounting included a review of the cash flow forecasts prepared by management, a review of management's assessment of going concern and post year end information impacting going concern. 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. 

Our application of materiality

Materiality	Basis for materiality
Group £144,000 (2022: £102,000) Company £100,800 (2022: £75,000)	2% of gross assets 2% of gross assets with 5% of loss before tax to obtain coverage of expenditure

 

We consider gross assets to be the most significant determinant of the group's financial position and performance used by shareholders, with the key financial statement balances being intangible exploration and evaluation assets and cash and cash equivalents. The going concern of the group is dependent on its ability to fund operations going forward, as well as on the valuation of its assets, which represent the underlying value of the group. The basis for calculating materiality was unchanged from the prior year.

 

Whilst materiality for the group financial statements as a whole was set at £144,000, materiality for the parent company was £100,800 and for significant components was set at a range between £100,800 and £71,400 (2022: £71,000 and £63,350). Performance materiality at 70% was set at £100,800 for the group, £70,560 for the parent company (2022: £71,400 and £52,500, respectively) and for the significant components at a range between £70,560 and £49,980 (2022: £49,700 and £44,350). We applied the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.

We agreed with the audit committee that we would report to the committee all audit differences identified during the course of our audit in excess of £7,200 (2022: £5,100) for the group and £5,040 (2022: £3,750) for the parent company.

Our approach to the audit

In designing our audit, we determined materiality and assessed the risk of material misstatement in the financial statements. In particular, we looked at areas requiring the directors to make subjective judgements, for example in respect of assessing the recoverability of exploration, evaluation and development expenditure, the valuation of share-based payments, the carrying value and recoverability of investments in subsidiaries at parent company level, and the consideration of future events that are inherently uncertain. We also addressed the risk of management override of internal controls, including evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

An audit was performed on the financial information of the group's significant operating components which, for the year ended 31 December 2023, were located in the United Kingdom, Australia and Greece. The audit of significant components was performed in London solely by PKF Littlejohn LLP using a team with experience of auditing mineral exploration and publicly listed entities.

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 period 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. In addition to the matters described in the Material uncertainty related to concern section we have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matter	How our scope addressed this matter
Carrying value and appropriate capitalisation of Intangible Assets (refer Note 9) (GROUP)
The group carrying value of intangible assets in relation to capitalised exploration costs for its Australian and Greek projects is material. There is a risk that these assets have been incorrectly capitalised in accordance with the requirements of IFRS 6 and that there are indicators of impairment as at 31 December 2023.   Particularly for early stage exploration projects, where the calculation of recoverable amount via value in use calculations is not possible, management's assessment of impairment under IFRS 6 requires significant estimation and judgement.	Our work in this area included:   ·      Confirmation that the group has good title to the applicable exploration licences, and has fulfilled any specific conditions therein particularly having regard to minimum expenditure requirements; ·      Review and substantive testing of capitalised costs,  and consideration of appropriateness for capitalisation under IFRS 6; ·      Assessment of progress at the individual projects during the year and post year-end; ·      Consideration of management's impairment reviews in light of impairment indicators identified in accordance with IFRS 6, including corroboration and challenge thereof; and ·      Evaluating the disclosures included within the financial statements.
Recoverability of investments and intragroup balances (refer Notes 11 and 12) (COMPANY)
Investments in subsidiaries and intragroup loans are significant assets in the parent company's financial statements. Their recoverability is directly linked to the recoverability of intangible assets in those entities, and hence may not be fully recoverable.	Our work in this area included: ·      Confirmation of ownership of the investments; ·      Review of management's calculations of expected credit losses on the intragroup balances to ensure the rationale and accounting treatment is in accordance with IFRS 9; ·      Consideration of recoverability of investments and intragroup loans by reference to underlying net asset values and exploration projects; and ·      Evaluating the disclosures included within the financial statements.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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 the 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 the 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 in relation to which 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's and the 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 the 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

·      We obtained an understanding of the group and parent company and the sector in which they operate to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through discussions with management and application of our cumulative audit knowledge and experience of the industry. We ensured that the audit team collectively had the appropriate experience with auditing entities within this industry, facing similar audit and business risks, and of a similar size.

·      We determined the principal laws and regulations relevant to the group and parent company in this regard to be those arising from:

o  AIM Rules;

o  UK employment law; and

o  Local tax laws and regulations.

·      We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the group and parent company with those laws and regulations. These procedures included, but were not limited to:

o  Making enquiries of management;

o  A review of Board minutes;

o  A review of legal ledger accounts; and

o  A review of regulated news service announcements.

·      We also identified the risks of material misstatement of the financial statements due to fraud. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management override of controls, that the potential for management bias was identified in relation to the impairment assessment of intangible assets and we addressed this by challenging the assumptions and judgements made by management when auditing that significant accounting estimate.

·      We addressed the risk of fraud arising from management override of controls by performing audit procedures which included, but were not limited to: the testing of journals, reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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

Use of our report

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.

 

 

 

David Thompson (Senior Statutory Auditor)                                                                                    15 Westferry Circus

For and on behalf of PKF Littlejohn LLP                                                                                                   Canary Wharf

Statutory Auditor, 30 May 2024                                                                                                             London E14 4HD

 

 

 

 

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2023

 

       

 

	Note		2023		2022
			£		£
Interest income			2		1
Administrative expenses			(1,785,547)		(753,213)
Operating loss	6		(1,785,545)		(753,212)
Loss before taxation			(1,785,545)		(753,212)
Taxation	7		-		-
Loss for the year attributable to shareholders of the Company			(1,785,545)		(753,212)
Items that may be reclassified subsequently to profit or loss:
Foreign exchange translation movement			(203,202)		138,883
Total comprehensive loss attributable to shareholders of the Company			(1,988,747)		(614,329)
Loss per share attributable to shareholders of the Company
Basic and diluted	8		(0.10)p		(0.06)p

The notes form part of these financial statements.

 

 

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

FOR THE YEAR ENDED 31 DECEMBER 2023

 

 

	Note		2023		2022
			£		£
Assets
Non-current assets
Intangible assets	9		4,972,616		4,451,118
Property, plant and equipment	10		28,244		38,323
Other receivables	12		94,301		85,872
			5,095,161		4,575,313
Current assets
Cash and cash equivalents	13		436,575		420,255
Trade and other receivables	12		1,732,419		106,171
			2,168,994		526,426
Total assets			7,264,155		5,101,739
Equity and liabilities
Equity attributable to shareholders of the Company
Share capital	14		8,548,460		7,435,409
Share premium	15		21,210,144		18,233,976
Other reserves	15		2,190,753		2,295,035
Merger relief reserve	15		190,000		190,000
Foreign exchange reserve	15		(254,325)		(51,123)
Retained deficit			(24,842,895)		(23,161,632)
Total equity			7,042,137		4,941,665
Current liabilities
Trade and other payables	17		222,018		160,074
Total liabilities			222,018		160,074
Total equity and liabilities			7,264,155		5,101,739

 

 

The notes form part of these financial statements

 

 

David Price

Chief Executive Officer

 

The notes form part of these financial statements.