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Final Results for the Year Ended 30 June 2017
FERRUM CRESCENT LIMITED
(Incorporated and registered in Australia and registered as an external company
in the Republic of South Africa)
(Registration number A.C.N. 097 532 137)
(External company registration number 2011/116305/10)
Share code on the ASX: FCR
Share code on AIM: FCR
Share code on the JSE: FCR
Australian ISIN: AU000000WRL8
South African ISIN: AU000000FCR2
29 September 2017
Ferrum Crescent Limited
(“FCR”, the “Company” or the “Group”)(ASX, AIM, JSE: FCR)
Final Results for the Year Ended 30 June 2017
FCR, the lead-zinc exploration company, announces its final results for the year ended
30 June 2017.
A pdf copy of the full Annual Report and Accounts is attached here: http://www.rns-
pdf.londonstockexchange.com/rns/2592S_-2017-9-29.pdf and will be posted to
Shareholders in due course.
For further information on the Company, please visit www.fcrexploration.com
www.ferrumcrescent.com or contact:
Ferrum Crescent Limited
Grant Button, Chairman (Australia)
T: +61 8 9474 2995
Laurence Read, Executive Director (UK)
T: + 44 (0)20 3289 9923
Strand Hanson Limited (Nominated Adviser)
Rory Murphy / Matthew Chandler
T: +44 (0)20 7409 3494
Peterhouse Corporate Finance Limited (Broker)
Lucy Williams / Duncan Vasey / Heena Karani
T: +44 (0)20 7469 0930
Beaufort Securities Limited (Broker)
Elliot Hance
T: +44 (0)20 7382 8300
Bravura Capital (Pty) Ltd (JSE Sponsor)
Melanie De Nysschen
T (direct): +27 11 459 5052
The information contained within this announcement is deemed by the Company to constitute
inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.
Extracts from the Company’s audited Report and Accounts are set out below:
Introduction to the Group
Ferrum Crescent Limited (“Ferrum”, “FCR” or the “Company”) is an Australian
company listed on the Australian Securities Exchange (ASX: FCR) and on the JSE
Limited (JSE: FCR) and quoted on the AIM market of the London Stock Exchange plc
(AIM: FCR). During the year, the Company undertook operational restructuring which,
post period led to the divestment of its South African iron ore operations, and now
sees the Company focused on Spanish lead-zinc operations.
In carrying out its operations during the reporting period, the Group incurred a loss
after income tax for the period from 1 July 2016 to 30 June 2017 of $11,286,803 (2016:
loss of $1,573,533). The loss includes a loss of $9,262,484 on the sale of Batavia
Limited. The Group had net assets of $1,570,393 (2016: $718,659) as set out in the
Statement of Financial Position.
Review of operations and activities
Spanish lead-zinc portfolio
During September 2016, the Company advanced its refocus towards lead-zinc
exploration through the exercise of an option on a lead-zinc portfolio located in north-
western Spain. The Toral lead-zinc asset located in the Leon province has over 44,000
metres of historic drilling.
The Company has undertaken internal soil geochemistry and channel sampling at the
Toral lead-zinc asset (As announced on 23 February 2017), the key highlights of which
are set out below:
- Results from 575 soil samples, 108 rock chip samples, 23 channel samples.
- Channel sampling identified various mineralisation styles near surface, including:
o 0.9m @ 10.5% Zn & 2.5% Pb average achieved on main structure within Adit
49; and
o 1.2% Cu, 6.5% Zn & 13.5% Pb returned from a 1.2m channel sample in Adit 54.
- Soil sampling identified distinct, continuous zinc-? in-? soil 2 kilometre anomaly,
approximately 150 metres wide, including peak zinc-? in-? soil values of 1.4% zinc.
- New mineralising styles identified, associated with:
o Shear-related structural repetition and multiple structures sub-parallel to the
main shear;
o Cross-cutting faults associated with soil anomalies and sulphide mineralisation;
and
- Various zones of alteration associated with soil anomalies,
including dolomitisation, calcitic and chloritic alteration and zones of hydrothermal
brecciation.
- Formulation of a drill programme plan generated to intersect shallow untested
targets within main anomalous area.
Please refer to the company’s announcement dated 23 February 2017 for further
information.
The Company has undertaken a drilling programme which, post-period, returned
positive lead-zinc results at the Toral lead-zinc asset (as announced 7 September
2017). The key highlights of the drilling programme are set out below:
- All of the 1,046.9m drilled occurred within 200 metres of the surface.
- Intersection of lead-zinc anomalies in all six drill holes.
- Key intersections encountered (all widths given along the core):
- Hole TOR17009 1 metre grading at 1.22%Pb, 9.77%Zn (10.99% combined
Pb/Zn);
- Hole TOR17012 3 metres grading at 0.64%Pb, 6.46%Zn (7.10% combined
Pb/Zn);
- Hole TOR17012 1 metre grading at 0.67%Pb, 16.10%Zn (16.77% combined
Pb/Zn);
- Hole TOR17013 1 metre grading at 6.51%Pb, 6.50%Zn (13.01% combined
Pb/Zn); and
- Hole TOR17013 3 metres grading at 6.03%Pb, 5.49%Zn (11.52% combined
Pb/Zn).
Outlook
The Company is now reviewing all data and looking to develop a next stage of
exploration at Toral to unlock value from the significant drilling information held at the
project.
Competent Person’s Statement
The information set out in section 2 above relates to Exploration Results which are
based on information compiled by Mr Juki Laurikko who is a Member of the European
Federation of Geologists which is a Recognised Professional Organisation for the
purposes of the 2012 JORC Code. Mr Laurikko is a Technical Consultant to the
Company, and has sufficient experience which is relevant to the style of mineralisation
and type of deposit under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the ‘'Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’'. Mr
Laurikko consents to the inclusion in this announcement of the matters based on his
information in the form and context in which they appear. Mr Laurikko has also
reviewed and approved the technical information in his capacity as a qualified person
under the AIM Rules.
The Moonlight project
The Moonlight Deposit (upon which the Moonlight Project is based) is a magnetite
deposit located on the farms Moonlight, Gouda Fontein and Julietta in Limpopo
Province in the north of South Africa.
In June 2017, the Company entered into a legally binding agreement for the sale of Batavia
Ltd ("Batavia"), its wholly-owned Mauritian subsidiary which is the investment holding
company for all the Group's South African assets, including the Moonlight iron ore
project in Limpopo Province, northern South Africa (the “"Moonlight Project”"), to
NPSPL Africa Holdings Limited and its BEE partner, Ngwenya Capital (Pty) Limited
(together, the "Purchasers"). The Company no longer holds any interest in this project.
Corporate
July 2016
GBP374,453 raised before expenses through a placement of 187,226,485 new ordinary
shares of no par value each in the capital of the Company at a price of 0.20 pence per
new ordinary share.
Issued 66,874,816 new ordinary shares issued of no par value each in the capital of
the Company as a result of the exercise of, in aggregate, 66,874,816 options
exercisable at a price of 0.165 pence per share.
August 2016
Issued 44,797,543 new ordinary shares of no par value each in the capital of the
Company as a result of the exercise of, in aggregate, 44,797,543 options exercisable
at a price of 0.165 pence per share.
September 2016
Ferrum Crescent acquired 100 per cent. of the share capital of GoldQuest Iberica, S.L.
(“"GoldQuest”") further to the exercise of its option. Consideration comprised
GBP326,500 in cash and the issue of 100 million new ordinary shares in the capital of
Ferrum Crescent.
In connection with the Acquisition process, the Vendor, Crestgate, Lundin Mining
Corporation (“"Lundin”") and others, entered into an assignment and restatement
agreement (the “"Assignment Agreement”") with respect to certain residual historic
rights held by Lundin and its subsidiary over the Toral licence area.
Pursuant to the Assignment Agreement, the Vendor is required to:
i) make a one-off payment of US$2.5 million to Lundin at such time as a decision is
made to proceed with the construction of a mine on the Toral licence area;
ii) make a further one-off payment of US$5 million to Lundin following
commencement of commercial production (as defined in the agreement) on the
Toral licence area; and
iii) pay Lundin's subsidiary a 1.5 per cent. net smelter return royalty upon
commencement of commercial production on the Toral licence area.
The Vendor's abovementioned obligations to Lundin under the Assignment Agreement
are guaranteed by Crestgate and pursuant to the terms of the SPA will be assumed
by the Company within twelve months of completion.
Issued 5,381,907 new ordinary shares of no par value each in the capital of the
Company as a result of the exercise of, in aggregate, 5,381,907 options exercisable
at a price of 0.165 pence per share.
October 2016
Issued 181,560,288 new ordinary shares of no par value each in the capital of the
Company as a result of the exercise of, in aggregate, 181,560,288 options exercisable
at a price of 0.165 pence per share.
November 2016
Issued 769,231 new ordinary shares of no par value each in the capital of the Company
as a result of the exercise of, in aggregate, 769,231 options exercisable at a price of
0.165 pence per share.
December 2016
Issued 3,205,088 new ordinary shares of no par value each in the capital of the
Company as a result of the exercise of, in aggregate, 3,205,088 options exercisable
at a price of 0.165 pence per share.
GBP550,000 raised before expenses through a placement of 275,218,025 new ordinary
shares of no par value each in the capital of the Company at a price of 0.20 pence per
new ordinary share.
January 2017
Mr Klaus Borowski resigns from the Board of Directors of the Company as a non-
executive director. Laurence Read joins the board of directors as a non-executive
director.
February 2017
The agreement with Business Venture Investments No. 1709 (Proprietary) Limited
(“"BVI”") for the Moonlight iron ore projects terminates due to non-completion of
specified work streams within a stated period by BVI.
April 2017
Company announces proposed wind-down and hand back of Moonlight assets in lieu
of a credible development partner being secured.
June 2017
GBP225,521 raised before expenses through a placement of 322,173,789 new ordinary
shares of no par value each in the capital of the Company at a price of 0.07 pence per
new ordinary share.
Significant events after the reporting date
There are subsequent events to report, as follows:
On 8 September 2017, the Company announced that it had conditionally raised in
aggregate, GBP193,304 (approximately AU$321,590) before expenses through a
placement via Peterhouse Corporate Finance Limited, as agent to the Company, of
214,782,526 new ordinary shares of no par value each in the capital of the Company
at a price of 0.09 pence per new ordinary share. Following admission, the total issued
ordinary share capital of the Company was 2,684,781,581 ordinary shares.
On 26 September 2017, the Company announced that Mr Justin Tooth, Executive
Chairman, had resigned from the Board of Directors of the Company with immediate
effect, in order to pursue his other business interests. Mr Grant Button, previously a
non-executive director of the Company and the Company secretary, will assume the
role of non-executive Chairman with immediate effect. Mr Laurence Read, previously
a non-executive director, will become an executive director, with immediate effect.
Likely developments and expected results
The Group will continue to carry out its business plans, by:
- Conducting its planned initial zinc exploration work programme on the Iberian
Projects in Spain;
- Seeking further strategic acquisition opportunities within the exploration and
mining industry to enter potentially into additional advanced projects that will add
value to the Group; and
- Continuing to meet its statutory commitments relating to its exploration
tenements and carrying out exploration of its exploration tenements in
accordance with its stated strategy, whilst carefully conserving the Group’s cash
reserves in order to be able to take advantage of value adding opportunities.
There can be no guarantee either that further exploration of the Group’s tenements
will result in exploration success or that any potential additional strategic acquisition
considered by the Directors to be likely to add value to the Group will become available
to the Group.
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 30 June 2017
2017 2016
Note $ $
Revenue from continuing operations
Revenue 3(a) 17,956 22,517
Other income 3(b) 175,851 490,850
Administration expenses 3(c) (1,595,427) (1,416,748)
Occupancy expenses (60,139) (52,382)
Exploration expenditure (514,439) (188,506)
Fair value gain on financial instrument 3(d) - 46,868
Foreign exchange loss (37,064) (395,816)
Share based payments 19 (11,057) (34,097)
Fair value gain on disposal of available for sale
investments - 649
Impairment of minority interest obligation 3(d) - (46,868)
Loss from sale of subsidiaries 6 (9,262,484) -
Loss before taxation (11,286,803) (1,573,533)
Income tax benefit / (expense) 5 - -
Loss after income tax for the year from continuing
operations (11,286,803) (1,573,533)
Net loss for the year (11,286,803) (1,573,533)
Other comprehensive income
Items that may be reclassified subsequently to profit or
loss
Net exchange gain/ (loss) on translation of foreign
(930,007) 226,166
operation
Reclassification of net changes in fair value relating to
the disposal of available for sale investments - 649
Income tax effect - (182)
Fair value on investment unrealised - 524
Other comprehensive income/ (loss) for the year,
net of tax (930,007) 227,157
Total comprehensive loss for the year (12,216,810) (1,346,376)
Net loss for the year attributable to:
Equity holders of the Parent (11,286,803) (1,573,533)
(11,286,803) (1,573,533)
Total comprehensive loss for the period attributable to:
Equity holders of the Parent (12,216,810) (1,346,376)
(12,216,810) (1,346,376)
Loss per share Cents per share Cents per share
Basic loss for the year attributable to ordinary equity
holders of the Parent 8 (0.91) (0.22)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should
be read in conjunction with the accompanying notes in the full Report and Accounts.
Consolidated Statement of Financial Position
As at 30 June 2017
2017 2016
Note $ $
Assets
Current assets
Cash and short term deposits 9 503,891 743,264
Trade and other receivables 10 46,624 33,929
Other current financial assets 13 14,344 29,303
Prepayments 49,523 50,606
Total current assets 614,382 857,102
Non-current assets
Plant and equipment 11 21,865 13,533
Investments 12 1,180,488 243,331
Other non-current financial assets 13 - 64,715
Total non-current assets 1,202,353 321,579
Total assets 1,816,735 1,178,681
Liabilities and equity
Current liabilities
Trade and other payables 14 242,804 263,827
Provision for payments received in advance 15 - 175,722
Provisions 16 3,538 20,473
Total current liabilities 246,342 460,022
Total liabilities 246,342 460,022
Equity
Contributed equity 17 35,931,732 33,049,490
Accumulated losses 20 (36,483,664) (24,424,297)
Reserves 19 2,122,325 (7,906,534)
Equity attributable to equity holders of the Parent 1,570,393 718,659
Total equity 1,570,393 718,659
Total equity and liabilities 1,816,735 1,178,681
This Consolidated Statement of Financial Position is to be read in conjunction with the
accompanying notes in the full Report and Accounts.
Consolidated Statement of Cash Flows
For the year ended 30 June 2017
2017 2016
Note $ $
Cash flows from / (used in) operating activities
Interest received 8,653 3,191
Income from available for sale investment - 5,242
Exploration and evaluation expenditure (463,585) (183,483)
Receipts from customers 9,303 14,084
Payments to suppliers and employees (1,695,759) (1,417,784)
Net cash flows used in operating activities 23 (2,141,388) (1,578,750)
Cash flows from / (used in) investing activities
Payments for plant and equipment (17,679) -
Sale of plant and equipment 2,588 -
Payment for acquisition of GoldQuest asset (519,821) (243,331)
Cash acquired on acquisition of GoldQuest asset 8,923
Purchase of available-for-sale financial assets - (30,360)
Proceeds from sale of subsidiaries 6 1,000 -
Proceeds from disposal of available-for-sale financial
assets - 92,699
Net cash flows used in investing activities (524,989) (180,992)
Cash flows from / (used in) financing activities
Proceeds from issue of shares 2,821,053 1,676,878
Transaction costs on issue of shares (330,305) (169,481)
Net cash flows from financing activities 2,490,748 1,507,397
Net increase / (decrease) in cash and cash equivalents
held (175,629) (252,345)
Net foreign exchange difference (63,744) (32,859)
Cash and cash equivalents at 1 July 743,264 1,028,468
Cash and cash equivalents at 30 June 9 503,891 743,264
The above Consolidated Statement of Cash Flows should be read in conjunction with the
accompanying notes in the full Report and Accounts which can be accessed via the following
link: http://www.rnspdf.londonstockexchange.com/rns/2592S_-2017-9-29.pdf
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