Wrap Text
15 months results for the period ended 31 December 2012
Kibo Mining Plc
(Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10) Share
code on the JSE Limited: KBO
Share code on the AIM: KIBO ISIN:
IE00B61XQX41
("Kibo" or "the Company")
15 months results for the period ended 31 December 2012
Dated: 1 July 2013
Kibo Mining plc ("Kibo" or the "Company" (AIM: KIBO; AltX: KBO), the mineral exploration and
development company focused on gold nickel, coal and uranium projects in Tanzania is pleased to
announce its audited 15 month financial results for the period ending 31 December 2012. The Company's
Annual Report, which contains the financial statements accompanying this announcement, is in the process
of being printed and mailed to shareholders. Details of the date and venue for this year's AGM, which will
take place towards the end of July, will be announced shortly.
Louis Coetzee, CEO of the Company, commented today:
"These audited accounts show an increase in our issued share capital following an equity investment by
Mzuri Gold Limited in February 2012, the acquisitions of Mzuri Energy Limited and Mayborn Investments
(Pty) Limited completed in October 2012 and set up costs settled by equity in relation to our SEDA with
Yorkville, also in October 2012. The Mzuri Energy and Mayborn acquisitions are particularly pleasing as
they provide us with a large thermal coal resource on which we are now actively negotiating with multi-
national state owned Korean East-West Power on the terms for their joint participation in the development
of a mouth-of-mine thermal power plant".
Highlights from the Chairman, Christian Schaffalitzky's statement:
- Completion of a 100% acquisition of Mzuri Gold Limited and Mayborn Resources Limited
which re-position Kibo as a major multi-commodity mineral explorer and developer in
Tanzania;
- Completion of a JV agreement with Brazilian industrial conglomerate Votorantim on the Haneti
project and the commencement of a GBP0.5m field programme being the initial tranche of a
proposed GBP2.7M expenditure by Votorantim to acquire a 50% interest in the project;
- Securing of Tanzanian Government support for the Rukwa Coal to Power project and the
commencement of negotiations with Korean East-West Power to participate as a partner in the
development;
- Prioritisation of the Rukwa and Haneti projects, deferral of exploration on the Company's other
projects and on-going rationalization of its large early stage mineral licence portfolio.
Chairman's Statement
Dear Shareholder,
I am pleased to report that your Company has made significant progress during 2012 on both the corporate
and exploration fronts. In April 2012 we announced the acquisition of two private companies, Mzuri
Energy Ltd and Mayborn Resource Investments (Pty) Limited. These acquisitions required the suspension
of our shares on AIM and the JSE on the 11th May 2012, re-admission on the 15th August 2012 and
approval by Shareholders at EGM on the 6th September 2012. The transaction was formally completed on
the 1st October 2012 and brings to your Company substantial coal and uranium assets which complement
our existing gold and base metal projects. Kibo is now positioned as a major multi-commodity mineral
explorer and developer in Tanzania. The transaction was accompanied by changes on our Board with the
resignation of William Payne and Des Burke (Des resigned in January 2013) and the appointment of Cecil
Bond and Bernard Poznanski. I wish to thank William and Des for their valuable contribution to Kibo
during their directorships.
Exploration
Exploration on our Tanzanian mineral projects continued throughout the 15 month reporting period
commencing with the implementation of a Stage 1 exploration programme in the last quarter of 2011 and
continuing throughout 2012. Our exploration teams have now defined trenching and drill targets at the
Lake Victoria, Haneti and Morogoro projects. I am particularly pleased that our Haneti Ni-PGM-Gold
project has attracted the attention of major Brazilian industrial group, Votorantim Metaís Participações
Ltda ("Votorantim"), resulting in our announcement of a Joint Venture on the 12 December 2012. The
joint venture provides an option for Votorantim to expend GBP 2.7 million on exploration over a three-
year period to earn a 50% interest in the project and I am glad to report that as I write (June 2013), our
field team in conjunction with Votorantim have commenced field operations. A budget of GBP0.5M will
be expended at Haneti during the remainder 2013.
Equally encouraging is the recent inclusion of the Company's Rukwa Coal to Power Project ("Rukwa") as
a strategic component of the Tanzanian Government's National Energy Strategy and its commitment to
proactively support development of the infrastructure to support the project. Securing Tanzanian
Government support for the project has been a major milestone in our development path and this has
increased the level of interest from third parties wishing to become partners in the project. Therefore, the
Company's announcement on the 24th April 2013 that it has selected Korean East West Power Co. Ltd
("EWP"), a globally operating power company owned by the South Korean Government, as its preferred
development partner at Rukwa is another major step. The board looks forward to negotiating a definitive
partnership agreement with EWP to the benefit of all stakeholders, not least for Tanzania for which Rukwa
should make a valuable contribution towards addressing the country's future energy needs.
In order to best manage its resources for 2013, your Company has prioritised the Rukwa and Haneti
projects and is deferring any significant exploration work at Lake Victoria, Morogoro and Pinewood to
2014. A Scoping Study at Rukwa will commence during the second half of 2013 which will run in parallel
with completing a full strategic partnership agreement with EWP. Exploration at Haneti, fully funded by
Votorantim, will continue for the remainder of 2013 and it is planned to commence initial drilling at the
project later in 2013 or early in 2014. As a further measure to reduce costs and focus on priority areas, the
Board has recently elected to relinquish almost 50% of its grass roots exploration interests (includes
licences, offers and applications) across all projects save for Rukwa. The majority of this ground comprises
early stage licence applications considered by Company geologists as low priority from desktop and field
assessments. This need for the Company to implement this reduction in our licence portfolio results both
from recent substantial increases in licence rental costs in Tanzania and the imperative to focus resources
on priority areas which offer the greatest chance of exploration success.
Corporate
The financial accounts cover the 15-month period to the 31 December 2012. This follows our decision to
change the Company's financial year end from 30 September to 31 December and so align it with the
calendar year and with the financial year ends of the Group's non-Irish subsidiaries.
The challenging global economic conditions and turbulent markets of 2011 continued into 2012, making it
a difficult year for the exploration and mining sector. Junior exploration companies found it particularly
difficult to raise equity funds and had to accept funding at severely discounted prices or through alternative
funding methods, all of which contributed to significant shareholder dilution and value erosion in many
instances. Unfortunately, Kibo was not immune to this adverse macroeconomic environment and we saw a
decline in our share price during the year to levels that we do not believe reflect the inherent value in our
mineral assets. Consequently, we found it increasingly difficult throughout 2012 to raise funds for our
exploration and development programmes to match our ambitious implementation schedule. However, we
are fortunate to have the support of our largest shareholder, Mzuri Capital Group Limited, which fully
subscribed to a GBP750,000 Placing in February 2012. This allowed us to implement first stage
exploration programmes over our substantial Tanzanian mineral licence portfolio over the reporting period.
Broker sponsored placings of GBP750,000 in January 2013 and GBP780,000 in April 2013, together with
funds of GBP50,000 drawn downs under our SEDA agreement with Yorkville Advisors, are allowing us to
continue advancing both our near-term corporate and exploration objectives in the early part of 2013, albeit
at a slower pace that we had planned.
In conclusion, while acknowledging the challenging economic environment in which your company now
operates, I remain confident that our mineral assets present an attractive investment option, particularly
bolstered by our 109 million tonne Rukwa coal deposit and plans to develop a mouth of mine thermal coal
plant. I would like to thank our shareholders for their continued support as we strive to bring this project
to fruition. Also I would like to thank our CEO, Louis Coetzee and his management team for their
substantial work in successfully completing our corporate acquisitions during 2012 while simultaneously
keeping field exploration moving forward. Louis now has the challenging task of leading the team in
realising value across all our commodity streams in 2013 and beyond.
Christian Schaffalitzky Chairman
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
All figures are stated in Sterling GROUP
15 month 12 month
period ended period ended
31 December 30 September
2012 2011
Audited Restated
Continuing operations GBP GBP
Administrative expenses (2,295,936) (831,342)
Exploration expenditure (897,740) (1,200,343)
Share based payment charge (1,290,446) (424,570)
Operating loss (4,484,122) (2,456,255)
Investment income 1,043 7,248
Loss on ordinary activities before tax (4,483,079) (2,449,007)
Taxation - -
(Loss) for the period (4,483,079) (2,449,007)
Other comprehensive income:
Exchange differences on translation of foreign operations (3,830) (74, 656)
Other Comprehensive income for the period net of tax (3,830) (74 656)
Total comprehensive income for the period (4,486,909) (2,523,663)
Loss for the period attributable to the owners of the parent (4,483,079) (2,449,007)
Total comprehensive Income attributable to the owners of the (4,486,909) (2,523,663)
parent
Loss Per Share (pence)
Basic earnings per share (pence) 1 (0.83) (0.74)
Diluted earnings per share (pence) 1 (0.83) (0.74)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
All figures are stated in Sterling GROUP
31 30 30
December September September
2012 2011 2010
Audited Restated Restated
GBP GBP GBP
Assets
Non-Current Assets
Property, plant and equipment 10,654 - 1,306
Intangible assets 21,054,614 3,853,550 3,023,509
Goodwill 3,307,757 - -
Total non-current assets 24,373,025 3,853,550 3,024,815
Current Assets
Trade and other receivables 75,438 52,965 22,981
Cash and cash equivalents 98,678 937,084 421,359
Total current assets 174,116 990,049 444,340
Total Assets 24,547,141 4,843,599 3,469,155
Equity and Liabilities
Equity
Called up share capital 9,192,046 3,231,898 2,132,295
Share premium account 21,879,748 5,887,327 3,533,115
Share based payment reserve 977,543 456,820 32,250
Translation reserve (81,334) (85,164) (10,508)
Retained deficit (9,237,758) (4,754,679) (2,305,672)
22,730,245 4,736,202 3,381,480
Total Equity 22,730,245 4,736,202 3,381,480
Liabilities
Current Liabilities
Trade and other payables 1,783,668 94,735 85,575
Current tax ,liabilities 33,228 12,662 2,100
Total Current Liabilities 1,816,896 107,397 87,675
Total Equity and Liabilities 24,547,141 4,843,599 3,469,155
COMPANY STATEMENT OF FINANCIAL POSITION
All figures are stated in Sterling COMPANY
31 30 30
December September September
2012 2011 2010
Audited Restated Restated
GBP GBP GBP
Assets
Non-Current Assets
Investments in group undertakings 4,326,511 4,326,511 2,626,511
Total Non-current assets 4,326,511 4,326,511 2,626,511
Current Assets
Trade and other receivables 24,512,666 3,238,206 2,313,743
Cash and cash equivalents 16,229 333,928 235,521
Total Current assets 24,528,895 3,572,134 2,549,264
Total Assets 28,855,406 7,898,645 5,175,775
Equity and Liabilities
Equity
Called up share capital 9,192,046 3,231,898 2,132,295
Share premium 21,879,748 5,887,327 3,533,115
Share based payment reserve 510,978 456,820 32,250
Translation reserves (19,754) (90,373) (9,255)
Retained deficit (4,190,391) (1,654,268) (572,930)
27,372,627 7,831,404 5,115,475
Total Equity 27,372,627 7,831,404 5,115,475
Liabilities
Current Liabilities
Trade and other payables 1,449,552 54,619 58,200
Current tax liabilities 33,227 12,622 2,100
Current Liabilities
Trade and other payables 13 5,318 -
Total current liabilities 1,482,779 67,241 60,300
Total Equity and Liabilities 28,855,406 7,898,645 5,175,775
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Share Total share Share based Foreign currency Total Retained Total
GROUP Capital premium capital payment reserve translation reserve reserves deficit
Restated Restated Restated Restated Restated Restated Restated Restated
All figures are stated in Sterling GBP GBP GBP GBP GBP GBP GBP GBP
Balance as at 1 October 2010 2,132,295 3,533,115 5,665,410 32,250 (10,508) 21,742 (1,063,119) 4,624,034
Change in accounting policy - - - - - - (1,242,553) (1,242,553)
Restated balance as at 1 October 2010 2,132,295 3,533,115 5,665,410 32,250 (10,508) 21,742 (2,305,672) 3,381,480
Profit / (loss) for the period - - - - - - (3,691,561) (3,691,561)
Change in accounting policy 1,242,553 1,242,553
Restated profit / (loss) for the period (2,449,007) (2,449,007)
Other comprehensive income-exchange - - - - (74,656) (74,656) - (74,656)
differences on translating foreign operations
Proceeds of share issue of share capital 1,099,603 2,354,212 3,453,815 - - - - 3,453,815
Share options issued - - - 424,570 - 424,570 - 424,570
1,099,603 2,354,212 3,453,815 424,570 (74,656) 349,914 (2,449,007) 1,354,722
Restated balance at 30 September 2011 3, 231,898 5,887,327 9,119,225 456,820 (85,164) 371, 656 (4,754,679) 4,736,202
Profit / (loss) for the period - - - - - - (4,483,079) (4,483,079)
Other comprehensive income-exchange - - - - 3,830 3,830 - 3,830
differences on translating foreign operations
Proceeds of share issue of share capital 5,960,148 15,992,421 21,952,569 - - - - 21,952,569
Share options acquired through business - - - 466,565 - 466,565 - 466,565
combinations
Share options issued 54,158 - 54,158 - 54,158
5,960,148 15,992,421 21,952,569 520,723 3,830 524,553 (4,483,079) 17,994,043
Balance at 31 December 2012 9,192,046 21,879,748 31,071,794 977,543 (81,334) 896,209 (9,237,758) 22,730,245
Share capital Share Total share Share based Foreign Total Retained Total equity
premium capital payment currency reserves deficit
reserve translation
COMPANY reserve
Restated Restated Restated Restated Restated Restated Restated Restated
All figures are stated in Sterling GBP GBP GBP GBP GBP GBP GBP GBP
Balance at 1 October 2010 2,132,295 3,533,115 5,665,410 32,250 (9,255) 22,995 (572,930) 5,115,475
Profit / (loss) for the period - - - - - - (1, 081,338) (1,081,338)
Other comprehensive income-exchange differences - - - - (81,118) (81,118) - (81,118)
Proceeds of issue of share capital 1,099,603 2,354,212 3,453,815 - - - - 3,453,815
Share options issued - - - 424,570 - 424,570 - 424,570
Balance at 1 October 2011 3, 231,898 5, 887,327 9, 119,225 456,820 (90,373) 366,447 (1, 654,268) 7, 831,404
Profit / (loss) for the period - - - - - - (2,536,123) (2,536,123)
Other comprehensive income-exchange differences - - - - 70,619 70,619 - 70,619
Proceeds of issue of share capital 5,960,148 15,992,421 21,952,569 - - - - 21,952,569
Share options issued - - - 54,158 - 54,158 54,158
5,960,148 15,992,421 21,952,569 54,158 70,619 124,777 (2,536,123) 19,541,223
Balance at 31 December 2012 9,192,046 21,879,748 31,071,794 510,978 (19,754) 491,224 (4,190,391) 27,372,627
CONSOLIDATED STATEMENT OF CASH FLOWS
All figures are stated in Sterling
GROUP
15 month 12 Month period
period ended ended
31 December 30 September
2012 2011
Restated Restated
GBP GBP
Cash flows from operating activities
Loss for the period before taxation (4,483,079) (2,449,007)
Adjustments for:
Foreign exchange (gain) (83,871) (74,656)
Depreciation 1,072 1,306
Investment income (1,043) (7,248)
Movement of exploration activities 897,740 1,200,343
Share based payments 1,290,446 424,570
(2,378,735) (904,692)
Movement in working capital
(Increase) in debtors (22,473) (29,984)
Increase/ (Decrease) in creditors 1,709,499 19,722
1,687,026 (10,262)
Net cash outflows from operating activities (691,709) (914,954)
Cash flows from financing activities
Proceeds of issue of share capital 750,000 1,753,815
Investment income 1,043 7,249
Net cash proceeds from financing activities 751,043 1,761,064
Cash flows from investing activities
Expenditure on exploration activities (897,740) (330,385)
Purchase of property, plant and equipment - -
Net cash used in investing activities (897,740) (330,385)
Net increase in cash and cash equivalents (838,406) 515,725
Cash and cash equivalents at beginning of period 937,084 421,359
Cash and cash equivalents at end of the period 98,678 937,084
COMPANY STATEMENT OF CASH FLOWS
All figures are stated in Sterling
COMPANY
15 month 12 month
period ended period ended
31 December 30 September
2012 2011
Restated Restated
GBP GBP
Cash flows from operating activities
Loss for the period before taxation (2,536,123) (1, 081, 338)
Adjustments for:
Foreign exchange loss (74,991) (81, 118)
Investment income (1,116) (7, 248)
Share based payments 111,033 424, 570
(2,501,197) (745 134)
Movement in working capital
Decrease/(Increase) in debtors 16,844 (924, 463)
Increase in creditors 1,415,538 6, 941
1,432,382 (917, 522)
Net cash outflows from operating activities (1,0,68,815) (1, 662, 649)
Cash flows from financing activities
Proceeds of issue of share capital 750,000 1, 753, 815
Investment income 1,116 7, 248
Net cash proceeds from financing activities 751,116 1, 761, 063
Cash flows from investing activities
Cost of investment in subsidiary - -
Net cash used in investing activities - -
Net increase in cash and cash equivalents (317,699) 98, 407
Cash and cash equivalents at beginning of period 333,928 235, 521
Cash and cash equivalents at end of the period 16,229 333, 928
1. Loss per share
Basic earnings per share
The basic and weighted average number of ordinary shares used in the calculation of basic
earnings per share is as follows:
15 month 12 month
period ended period ended
31 December 30 September
2012 2011
Loss for the period attributable to equity holders of the (GBP4,483,079) (GBP2,449,007)
parent
Weighted average number of ordinary shares for the 541,336,221 331,040,217
purposes of basic earnings per share
Basic loss per ordinary share (pence) (0.83) (0.74)
Diluted loss per share
There is no dilutive effect of share options or warrants on the basic loss per share.
Diluted loss per ordinary share (pence) (0.83) (0.74)
The Directors present their Annual Report together with the audited financial statements for the
15 month period ended 31 December 2012 of Kibo Mining Plc ("the Company") and its
subsidiaries (collectively "the Group").
General Information
Kibo Mining Plc ("the Company") is a Company incorporated in Ireland. The Group financial
statements consolidate those of the Company and its subsidiaries (together referred to as the
"Group"). The principal activities of the Company and its subsidiaries are related to the
exploration for and development of coal and other minerals in Tanzania. The figures in the
financial statements are presented in Sterling unless otherwise stated.
Statement of Compliance
As permitted by the European Union, the Group financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRSs) and their interpretations
issued by the International Accounting Standards Board (IASB) as adopted by the EU (IFRS). The
individual financial statements of the Company ("Company financial statements") have been
prepared in accordance with the Companies Act, 1963 to 2012 which permits a Company that
publishes its Company and Group financial statements together, to take advantage of the
exemption in Section 148(8) of the Companies Act, 1963, from presenting to its members its
Company Income Statement and related notes that form part of the approved Company financial
statements.
The IFRSs adopted by the EU as applied by the Company and the Group in the preparation of
these financial statements are those that were effective at 31 December 2012.
Statement of Accounting Policies
The accounting policies set out below have been applied consistently to all periods presented in
these consolidated financial statements.
Basis of Preparation
The Group and Company financial statements are prepared on the historical cost basis. The
accounting policies have been applied consistently by Group entities. The Group and Company
financial statements have been prepared on a going concern basis as explained on page 8.
Use of Estimates and Judgements
The preparation of financial statements in conformity with EU IFRS requires management to
make judgements, estimates and assumptions that affect the application of accounting policies
and the reported amounts of assets, liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results of which form the basis of making
judgements about carrying values of assets and liabilities that are not readily apparent from
other sources.
In particular, there are significant areas of estimation, uncertainty and critical judgements in
applying accounting policies that have the most significant effect on the amounts recognised in
the financial statements in the following areas:
- Measurement of the recoverable amounts of intangible assets; and
- Utilisation of tax losses
Exploration and evaluation expenditure
The Group's revised accounting policy for exploration and evaluation expenditure results in the
capitalisation of certain intangible mineral resources which are identified through business
combinations or equivalent acquisitions. This policy requires management to make certain
estimates and assumptions as to future events and circumstances, in particular whether an
economically viable extraction operation can be established based on the separately identified
mineral resources. Any such estimates and assumptions may change as new information becomes
available. If, after having capitalised the intangible mineral resources under the policy, a
judgement is made that recovery of the intangible asset is unlikely, the relevant capitalised
amount will be written off to the income statement.
Taxation
Assessing the recoverability of deferred income tax assets requires the Company to make
significant estimates related to expectations of future taxable income. Estimates of future taxable
income are based on forecast cash flows from operations and the application of existing tax laws
in each jurisdiction. To the extent that future cash flows and taxable income differ significantly
from estimates, the ability of the Company to realise the net deferred tax assets recorded at the
end of the reporting period could be impacted.
Revenue Recognition - Interest Revenue
Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the
effective interest rate applicable, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to that asset's net carrying amount.
Consolidation
The consolidated financial statements comprise the financial statements of Kibo Mining Plc and
its subsidiaries for the 15 month period ended 31 December 2012.
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power,
directly or indirectly, to govern the financial and operating policies of an entity so as to obtain
benefits from its activities. In assessing control, potential voting rights that are currently
exercisable or convertible are taken into account. Subsidiaries are fully consolidated from the
date that control commences until the date that control ceases.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency
with the policies adopted by the Group.
Intragroup balances and any unrealised gains or losses or income or expenses arising from
intragroup transactions are eliminated in preparing the Group financial statements, except to the
extent they provide evidence of impairment.
The Group accounts for business combinations using the acquisition method of accounting. The
cost of the business combination is measured as the aggregate of the fair values of assets given,
liabilities incurred or assumed and equity instruments issued. Costs directly attributable to the
business combination are expensed as incurred, except the costs to issue debt which are
amortised as part of the effective interest and costs to issue equity which are included in equity.
The acquiree's identifiable assets, liabilities and contingent liabilities which meet the recognition
conditions of IFRS 3 Business Combinations are recognised at their fair values at acquisition date.
Contingent liabilities are only included in the identifiable assets and liabilities of the acquiree
where there is a present obligation at acquisition date.
Non-controlling interest arising from a business combination is measured either at their share of
the fair value of the assets and liabilities of the acquiree or at fair value. The treatment is not an
accounting policy choice but is selected for each individual business combination, and disclosed
in the note for business combinations.
Intangible Assets
An intangible asset is recognised when:
- it is probable that the expected future economic benefits that are attributable to the asset will
flow to the entity; and
- the cost of the asset can be measured reliably.
Intangible assets are carried at cost less accumulated amortisation and impairment.
Irrespective of whether there is any indication of impairment, the Group also:
- tests intangible assets with an indefinite useful life or intangible assets not yet available for use
for impairment annually by comparing its carrying amount with its recoverable amount. This
impairment test is performed during the annual period and at the same time every period; and
- test goodwill by comparing its carrying value with its recoverable amount.
Exploration & Evaluation Assets
Exploration and evaluation activity involves the search for mineral resources, the determination
of technical feasibility and the assessment of commercial viability of an identified resource.
Exploration and evaluation activity includes:
- researching and analysing historical exploration data;
- gathering exploration data through topographical, geochemical and geophysical studies;
- exploratory drilling, trenching and sampling;
- determining and examining the volume and grade of the resource;
- surveying transportation and infrastructure requirements; and
- conducting market and finance studies.
Administration costs attributable to exploration activities are charged to the income statement.
Licence costs paid in connection with a right to explore in an existing exploration area is charged
to the income statement. Exploration and evaluation expenditure is charged to the income
statement as incurred except in the following circumstances, in which case the expenditure may
be capitalised:
- In respect of minerals activities:
the exploration and evaluation activity is within an area of interest which was previously
acquired as an asset acquisition or in a business combination and measured at fair value
on acquisition; or
the existence of a commercially viable mineral deposit has been established.
Capitalised exploration and evaluation expenditure considered to be tangible is recorded as a
component of property, plant and equipment at cost less impairment charges. Otherwise, it is
recorded as an intangible. As the capitalised exploration and evaluation expenditure asset is not
available for use, it is not depreciated. All capitalised exploration and evaluation expenditure is
monitored for indications of impairment. Where a potential impairment is indicated, assessment
is performed for each area of interest in conjunction with the group of operating assets
(representing a cash generating unit) to which the exploration is attributed. Exploration areas at
which reserves have been discovered but require major capital expenditure before production
can begin, are continually evaluated to ensure that commercial quantities of reserves exist or to
ensure that additional exploration work is under way or planned.
Impairment
Assets are reviewed for impairment at each reporting date or whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. An impairment loss is
recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For
the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash generating units).
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised in the Statement of Comprehensive
Income immediately.
Property, Plant and Equipment
Property, Plant and Equipment are stated at cost or valuation, less accumulated depreciation.
Depreciation is provided at rates calculated to write off the cost less residual value of each asset
over its expected useful life, as follows:
Office equipment-between 12.5% to 37.5% straight line;
Plant & machinery at 20% straight line;
Furniture and fixtures at 12.5% straight line;
Motor vehicles at 25% straight line; and
I.T Equipment at 20% straight line
The residual value and useful lives of the property, plant and equipment are reviewed annually
and adjusted if appropriate at each Statement of Financial Position date.
On disposal of property, plant and equipment the cost and the related accumulated depreciation
and impairments are removed from the financial statements and the net amount, less any
proceeds, is taken to the Statement of Comprehensive Income.
Income Tax
Income tax expense comprises current and deferred tax. Income tax expense is recognised in the
Income Statement except to the extent that it relates to items recognised directly in equity, in
which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted at the reporting date, and any adjustment to tax payable in respect of
previous years.
Deferred tax is recognised using the balance sheet method, providing for temporary differences
between the carrying amounts of assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes. Deferred tax is not recognised for the following temporary
differences: the initial recognition of goodwill, the initial recognition of assets or liabilities in a
transaction that is not a business combination and that affects neither accounting nor taxable
profit, and differences relating to investments in subsidiaries to the extent that they probably will
not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected
to be applied to the temporary differences when they reverse, based on the laws that have been
enacted or substantively enacted by the reporting date.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will
be available against which temporary difference can be utilised. Deferred tax assets are reviewed
at each reporting date and are reduced to the extent that it is no longer probable that the related
tax benefit will be realised.
Additional income taxes that arise from the distribution of dividends are recognised at the same
time as the liability to pay the related dividend is recognised.
Foreign Currencies
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the
currency of the primary economic environment in which the entity operates ("the functional
currency"). The consolidated financial statements are presented in Sterling, which is the Group's
presentation currency. This is also the functional currency of the Group and Company and is
considered by the Board also to be appropriate for the purposes of preparing the Group financial
statements.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from
the settlement of such transactions and from the translation at period end exchange rates of
monetary assets and liabilities denominated in foreign currencies are recognised in the
Statement of Comprehensive Income.
Group companies
The results and financial position of all the Group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
- Monetary assets and liabilities for each Statement of Financial Position presented are
presented at the closing rate at the date of that Statement of Financial Position. Non-
monetary items are measured at the exchange rate in effect at the historical transaction
date and are not translated at each Statement of Financial Position date;
- Income and expenses for each income statement are translated at average exchange rates
(unless this average is not a reasonable approximation of the cumulative effect of the
rates prevailing on the transaction dates, in which case income and expenses are
translated at the dates of the transaction): and
- All resulting exchange differences are recognised as a separate component of equity. On
consolidation, exchange differences arising from the translation of monetary items
receivable from foreign subsidiaries for which settlement is neither planned nor likely to
occur in the foreseeable future are taken to shareholders equity. When a foreign
operation is sold, such exchange differences are recognised in the income statement as
part of the gain or loss on sale.
Issue Expenses and Share Premium Account
Issue expenses are written off against the premium arising on the issue of share capital.
Earnings per share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic
EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the
Company by the weighted average number of ordinary shares outstanding during the period.
Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders
and the weighted average number of ordinary shares outstanding for the effects of all dilutive
potential ordinary shares.
Financial Instruments
Cash and Cash Equivalents
Cash and Cash Equivalents in the Statement of Financial Position comprise cash at bank and in
hand and short term deposits with an original maturity of three months or less. Bank overdrafts
that are repayable on demand and form part of the Group's cash management are included as a
component of cash and cash equivalents for the purpose of the statement of cash flows.
Trade and other receivables / payables
Trade and other receivables and payables are stated at cost less impairment, which approximates
fair value given the short dated nature of these assets and liabilities.
Share based payments
For such grants of share options, the fair value as at the date of grant is calculated using the
Black-Scholes option pricing model, taking into account the terms and conditions upon which the
options were granted. The amount recognised as an expense is adjusted to reflect the actual
number of share options that are likely to vest, except where forfeiture is only due to market
based conditions not achieving the threshold for vesting.
Shareholder warrants
The shareholder warrants entitle shareholders to a number of common shares based upon the
number of shares they subscribed for at the date of issue of the warrant instrument. The
warrants relate to a transaction with the equity holders as opposed to a transaction in exchange
for any goods or services. The equity component of the instrument is not considered material and
there is no liability component arising as a result of these warrants. Upon exercise of the warrant
the proceeds received, net of attributable transaction costs, are credited to share capital and
where appropriate share premium.
Share Capital
Incremental costs directly attributable to the issue of ordinary shares and share options are
recognised directly in equity.
Contacts
Louis Coetzee +27 (0)83 2606126 Kibo Mining plc Chief Executive Officer
Andreas Lianos +27 (0)83 4408365 River Group Corporate Adviser and
Designated Adviser on JSE
Jon Belliss +44 (0) 20 3216 2630 XCAP Joint Broker
Stuart Laing +61 8 94802500 RFC Ambrian Nominated Adviser on AIM
Limited
Matt Beale +44 (0)7966 389196 Fortbridge Investor Relations
Updates on the Company's activities are regularly posted on its website www.kibomining.com
General Background & Strategy
Kibo was established in early 2008 to explore and develop mineral deposits in Tanzania, East
Africa and was admitted to AIM in London on 27 April 2010 and AltX in Johannesburg on 30
May 2011. The Board of Kibo is composed of professionals whose experience include mineral
exploration, mine development, mining finance, tax, law, mergers and acquisitions, and
financial control of public companies. It is supported by a competent and motivated Tanzanian
staff that operates from Kibo's operations office in Dar es Salaam.
The mineral assets of the Company comprise five projects areas in Tanzania - Haneti (nickel,
PGE and gold), Morogoro (Gold), Lake Victoria (Gold), Rukwa (Coal) and Pinewood (Coal &
Uranium).
The Haneti project is the subject of a joint venture with Brazilian Votorantim Metais
Participações Ltda, a member of Votorantim Group. The Rukwa and Pinewood projects are
situated close to the Mtwara Corridor, an area where the Tanzanian Government has
committed to significant infrastructure development and which has seen recent multi-million
dollar investment in coal and coal-fired power stations and uranium exploration.
The Rukwa project is substantially more advanced than Kibo's existing exploration projects,
with a significant Mineral Resource of thermal coal already defined. The project enjoys strong
support expressed by the Tanzanian Government for the expedited development of a coal mine
and mine-mouth coal-fired power plant.
Kibo's objective is to build shareholder value in a sustainable manner. This objective will be
pursued primarily through active exploration of its own projects and by using the Company's
experience in Tanzania to acquire attractive exploration and development assets on competitive
terms that can be moved swiftly up the value curve by using the Company's own skills base
whilst also seeking to benefit from strategic collaborative relationships with industry leaders
who have special skills and competencies within their chosen fields of focus. Kibo will
undertake continual risk assessment of its projects and take whatever actions it believes are
necessary to ensure that these risks are mitigated.
Johannesburg
1 July 2013
Corporate and Designated Adviser
River Group
Updates on the Company's activities are regularly posted on its website
www.kibomining.com
Review by Qualified Person
The information in this announcement that relates to the Rukwa mineral resources is taken
from a report titled "Independent Technical Report for the Rukwa Coal Project, Mbeya
Region, United Republic of Tanzania dated 19th April 2012". This report was prepared for the
Company by CD Van Niekerk Pr. Sc. Nat., Director and Principal Geologists with Gemecs
(Pty) Ltd. Mr. Van Niekerk is registered as a Professional Natural Scientist (Geological
Science) with the South African Council for Natural Scientific Professions (SACNASP),
Registration No 400066/98, is a Fellow Member of the Geological Society of South Africa
(FGGSA) and has extensive experience in coal resource evaluation. Mr Van Niekerk qualifies
as a Qualified Person under the AIM and JSE rules. Mr Van Niekerk consents to the inclusion
in this announcement of the resource information relating to the Rukwa Coal Project in the
form and context in which it appears.
Date: 01/07/2013 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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