Wrap Text
Condensed Consolidated Annual Financial Results of for the year ended 31 December 2017
Kibo Mining Plc
(Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10)
Share code on AIM: KIBO
Share code on the AltX: KBO
ISIN: IE00B97C0C31
("Kibo" or "the Company" or together with its subsidiaries "the Group")
Condensed Consolidated Annual Financial Results of for the year ended 31 December 2017
Dated: 14 June 2018
Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO; AltX: KBO), the mineral exploration and
development company focused on gold, nickel and coal and projects in Africa, is pleased to release its
condensed consolidated annual financial results for the year ended 31 December 2017. The Company's
Annual Report, which contains the full financial statements accompanying this announcement, is in
the process of being prepared for dispatch to shareholders. A copy of this Annual Report will also be
available from the Company's website at www.kibomining.com. Details of the date and venue for
this year's AGM, will be announced on posting of the Annual Financial Results.
Highlights from the Chairman, Christian Schaffalitzky's statement:
2017 was a challenging year for Kibo as we pushed ahead with our efforts to complete a Power
Purchase Agreement (PPA) for our flagship Mbeya Coal to Power Project (MCPP) amid significant
upheavals and changes in the Tanzanian mining policy and regulatory environment. As might be
expected, these events have impacted on our anticipated time line to finalise a PPA with the Tanzanian
Government and complete Financial Close on the project. I am delighted to reflect that despite these
delays, at the end of 2017, the Tanzanian Government reconfirmed in writing its strong support for the
MCPP as an important component of its national energy strategy and undertook to expedite finalisation
of the PPA. As you are no doubt aware this commitment was backed up when we signed a
Memorandum of Understanding (MOU) with TANESCO (the Tanzanian state electricity company) in
February 2018 as a preparatory step to finalising a PPA. Management is now in advanced negotiation
with TANESCO on the finalisation of the full PPA.
Kibo Mining's main achievements in 2017 were:
- The publication of the MCPP Integrated Bankable Feasibility Study (IBFS) at the start of 2017.
This was the culmination of 3 years' work by Kibo and the most important milestone in the
development path for the project to date;
- Full environmental certification for both Mbeya Coal Mine as well as Mbeya Power Plant;
- The completion of the divestment of our resource-based gold assets, Imweru and Lubando, in
northern Tanzania to AIM listed Katoro Gold PLC in which we retain a 56.7% interest; and
- The terms of the forward payment facility agreed in December 2016 with Sanderson Capital
Partners were mutually revised in September 2017 allowing for an extension to the drawdown
schedule and part re-payment of funds already drawn by the issue of a convertible loan note to
Sanderson which it immediately converted to Kibo shares.
Condensed Consolidated Financial Results for the year ended 31 December 2017
Condensed Consolidated Statement of Comprehensive Income
Year Year
ended ended
31 December 31 December
2017 2016
Audited Audited
GBP GBP
Revenue - 18,039
Administrative expenses (1,871,697) (1,653,152)
Capital raising fees (908,543) (1,648,004)
Exploration expenditure (1,741,018) (1,716,967)
Operating loss (4,521,258) (5,000,084)
Investment and other income 1,445 1,414,668
Loss from ordinary activities before tax (4,519,813) (3,585,416)
Taxation - -
Loss for the period (4,519,813) (3,585,416)
Other comprehensive gain:
Exchange differences on translation of foreign operations 16,985 99,128
Adjustment arising from change in non-controlling interest - 1,527,515
Other Comprehensive gain for the period net of tax 16,985 1,626,643
Total comprehensive loss for the period (4,502,828) (1,958,773)
Loss for the period (4,519,813) (3,585,416)
Attributable to the owners of the parent (3,712,707) (3,611,496)
Attributable to the non-controlling interest (807,106) 26,080
Total comprehensive loss for the period (4,502,828) (1,986,288)
Attributable to the owners of the parent (3,689,196) (1,984,853)
Attributable to the non-controlling interest (813,632) 26,080
Loss Per Share
Basic loss per share (0.010) (0.010)
Diluted loss per share (0.010) (0.010)
Headline loss per share (0.010) (0.010)
Condensed Consolidated Statement of Financial Position
31 December 31 December
2017 2016
Audited Audited
GBP GBP
Assets
Non-Current Assets
Property, plant and equipment 7,650 9,107
Intangible assets 17,596,105 17,596,105
Total non-current assets 17,603,755 17,605,212
Current Assets
Trade and other receivables 59,046 50,633
Cash 766,586 382,339
Total current assets 825,632 432,972
Total Assets 18,429,387 18,038,184
Equity and Liabilities
Equity
Called up share capital 14,015,670 13,603,965
Share premium account 28,469,750 27,318,262
Control reserve 2,097,442 -
Share based payment reserve 556,086 514,279
Translation reserve (268,506) (285,491)
Retained deficit (26,534,653) ( (23,625,367)
Attributable to equity holders of the parent 18,335,789 17,525,648
Non-controlling interest (1,383,388) (1,435)
Total Equity 16,952,401 17,524,213
Liabilities
Current Liabilities
Trade and other payables 266,218 146,380
Borrowings 1,210,768 251,928
Provisions - 115,663
Total Current Liabilities 1,476,986 513,971
Total Equity and Liabilities 18,429,387 18,038,184
Condensed Consolidated Statement of Changes in Equity
Share Share Treasury Total Share based Foreign Control Total Retained Non- Total
Capital premium shares share payment currency reserve deficit Controlling
capital reserve translation reserves Interest
reserve
All figures are stated in GBP GBP GBP GBP GBP GBP GBP GBP GBP GBP
Sterling
Balance as at 31 13,210,288 25,782,519 (44,464) 38,948,343 514,279 (384,619) - 129,660 (21,541,386) - 17,536,617
December 2015
Loss for the year - - - - - - - - (3,611,496) 26,080 (3,585,416)
Adjustment arising from - - - - - 1,527,515 (27,515) 1,500,000
change in non-
controlling interest
Other comprehensive - - - - - 99,128 - 99,128 - - 99,128
income - exchange
differences on
translating foreign
operations
Proceeds of share issue 393,677 1,335,876 1,729,553 - - - - - - 1,729,553
of share capital
Allotment of treasury - 199,867 44,464 244,311 - - - - - - 244,311
shares
393,677 1,535,743 44,464 1,973,884 - 99,128 - 99,128 (2,083,981) (1,435) (12,404)
Balance at 31 13,603,965 27,318,262 - 40,922,227 514,279 (285,491) - 228,788 (23,625,367) (1,435) 17,524,213
December 2016
Loss for the year - - - - - - - (3,712,707) (807,106) (4,519,813)
Adjustment arising from (302,117) 2,097,442 1,795,325 803,421 (568,321) 2,030,425
acquisition of subsidiary
Other comprehensive - - - - - 319,102 - 319,102 - (6,526) 312,576
income - exchange -
differences on
translating foreign
operations
Share options issued - - - - 41,807 - - 41,807 - - 41,807
during the current period
Proceeds of share issue 411,705 1,151,488 - 1,563,193 - - - - - 1,563,193
of share capital
411,705 1,151,488 - 1,563,193 41,807 16,985 2,097,442 2,156,234 (2,909,286) (1,381,953) (571,812)
Balance at 31 14,015,670 28,469,750 - 42,485,420 556,086 (268,506) 2,097,442 2,385,022 (26,534,653) (1,383,388) 16,952,401
December 2017
Condensed Consolidated Statement of Cash Flow
All figures are stated in Sterling
31 December 31 December
2017 2016
Audited Audited
GBP GBP
Cash flows from operating activities
Loss for the period before taxation (4,519,813) (3,585,416)
Adjustments for:
Foreign exchange gain 249,437 124,884
Depreciation on property, plant and equipment 2,738 8,228
Investment income - (1,815)
Share based remuneration to directors 260,000 -
Deal cost settled in shares 155,539 -
Movement in provisions (115,663) 115,663
Liabilities settled in shares - 1,648,004
Deemed cost of listing 206,680 -
(3,761,082) (1,690,452)
Movement in working capital
(Increase)/ Decrease in debtors (8,413) 500,059
Increase/ (Decrease) in creditors 119,838 (160,417)
111,425 339,642
Net cash outflows from operating activities (3,649,657) (1,350,810)
Cash flows from financing activities
Proceeds of issue of share capital 1,818,345 -
Repayment of borrowings - (200,000)
Proceeds from borrowings 1,751,326 1,751,928
Investment income - 1,815
Net cash proceeds from financing activities 3,569,671 1,553,743
Cash flows from investing activities
Net cash flow from acquisition of subsidiaries 465,408 (1,000)
Purchase of property, plant and equipment (1,175) (9,029)
Net cash used in investing activities 464,233 (10,029)
Net increase in cash 384,247 192,904
Cash at beginning of period 382,339 189,435
Cash at end of the period 766,586 382,339
Notes to the condensed consolidated financial results for the year ended 31 December 2017
1. General information
Kibo Mining Plc ("the Company") is a public limited company incorporated in Ireland. The consolidated
annual financial statements consolidate those of the Company and its subsidiaries (together referred to as
the "Group"). The Company's shares are listed on the AIM market ("AIM") of the London Stock
Exchange plc and the Alternative Exchange of the Johannesburg Stock Exchange Limited (AltX). The
principal activities of the Company and its subsidiaries are related to the exploration for and development
of coal and other minerals in Tanzania.
2. Statement of Compliance and basis of preparation
The condensed consolidated annual financial results for the year ended 31 December 2017 have been
prepared in accordance with framework concepts and the recognition and measurement criteria of
International Financial Reporting Standards (IFRS and IFRC interpretations) issued by the International
Accounting Standards Board (IASB) as adopted for use in the EU (IFRS, including the SAICA financial
reporting guides as issued by the Accounting Practices Committee and Financial Pronouncements as
issued by Financial Reporting Standards Council, IAS 34 - Interim Financial Reporting), the Listings
Requirements of the JSE Limited and the provisions of the Irish Companies Acts, 1963 to 2014 ('the
Companies Acts').
These condensed consolidated annual financial results do not include all the information required for full
financial statements and should be read in conjunction with the consolidated annual financial statements
of the Group for the period ended 31 December 2017, which is available for inspection at the Company's
registered offices.
The comparative amounts included in these condensed consolidated financial results include extracts
from the audited consolidated annual financial statements for the period ended 31 December 2017.
All monetary information is presented in the functional currency of the Company being pound Sterling.
The Company's financial statements are prepared on the historical cost basis, other than intangible assets
which is measured at fair value. The accounting policies have been applied consistently by Group entities
and are similar to those applied in the prior period. The Group financial results have been prepared on a
going concern basis.
These condensed consolidated financial results have been extracted from the audited financial statements
but are not itself audited.
3. Statement of Accounting Policies
The accounting policies have been applied consistently to all periods presented in these condensed
consolidated financial results using the accounting policies applied by the Group in its 31 December 2017
report, updated for any new accounting standards which became effective in the current year.
4. Responsibility Statement
The directors take full responsibility for the preparation of the report and that the financial information
has been correctly extracted from the underlying financial statements. These financial results were
prepared under the supervision of the Financial Director, Andreas Lianos.
5. Audit opinion
The consolidated annual financial statements were audited by the Company's auditors, Saffery
Champness LLP. The auditors' report together with the financial statements is available for inspection at
the Company's registered office. The auditors' report contains an emphasis of matter with regard to the
realisation of certain assets, as follows:
Emphasis of Matter - Realisation of Assets
In forming our opinion on the financial statements, which is not modified, we considered the adequacy of
disclosures made in Notes 11, 13 and 23 to the financial statements concerning the valuation of intangible
assets, and investments in Group undertakings. The realisation of intangible assets of GBP17,596,105
(2016: GBP17,596,105), amounts due from Group undertakings of GBP24,402,788 (2016: GBP26,998,867) and
investments in Group undertakings of GBP3,468,224 (2016: GBP1,700,000) included in the Company Statement
of Financial Position are dependent on the economic exploitation of gold and coal reserves including the
ability of the Group to raise sufficient finance to develop these projects.
6. Subsequent events
Mbeya Coal to Power Project
The Group made considerable progress in the Mbeya Coal to Power Project by signing a Memorandum of
Understanding ("MOU") with the Tanzania Electric Supply Company ("TANESCO"), on 14 February
2018. This MOU is the precursor to the finalisation of the Power Purchase Agreement ("PPA") for the
300MW mine - mouth power station to be constructed in south-western Tanzania. Although the PPA has
not been signed at the date of issue of the Annual Financial Statements, the Tanzanian Government's
recent pledge to support the private sector is favourable to the Group and evidences the National
government's commitment to all projects.
Strategies to complete the funding arrangements for this flagship project are ongoing.
Botswana Power Project Acquisition
On 3 April 2018, the Group completed the acquisition of an 85% interest in the Mabesekwa Coal
Independent Power Project, located in Botswana. This acquisition is in line with the Group's strategy of
positioning itself as a strategic regional electricity supplier in Southern Africa and creates many synergies
with the MCPP in Tanzania.
As a result of the acquisition, 153,710,030 ordinary shares in Kibo were issued to Sechaba Natural
Resources Limited ("Sechaba"). Sechaba retains a 15% interest in the Mabesekwa Coal Independent
Power Project and gained the right to a seat on Kibo's board of directors. Initial accounting for the business
combination is incomplete at the time the financial statements are authorised for issue, as management is
finalising outstanding areas with regard to the acquisition. As part of the terms of the acquisition,
Mr Mashale Phumaphi joined the company as a non-executive director, however, he has subsequently
resigned.
Share placements
Subsequent to year end, the company has raised the following placements:
- GBP750,000 in the placement of 17,647,060 ordinary Kibo shares at 4.25p per share;
- GBP1,500,000 in the placement of 28,571,428 ordinary Kibo shares at 5.25p per share;
- 8,370,716 ordinary shares in the company were issued, at a price of 5p per share, to Sanderson
Capital Partners Limited ("Sanderson") as a partial settlement on the balance of funds drawn
down under the forward payment facility between the Company and Sanderson. The shares issued
are in respect of a repayment amount of $568,712.
7. Litigation
There are currently no arbitration proceedings against the Group, or of which the Group is aware, which
may have, or have had in the 12 months preceding the date of this report, a material effect on the
consolidated annual financial results.
8. Dividends
There have been no dividends declared or paid during the current financial period.
9. Going Concern
The consolidated annual financial results have been prepared on the basis of accounting policies
applicable to a going concern. This basis presumes that funds will be available to finance future
operations and that the realisation of assets and settlement of liabilities, contingent obligations and
commitments will occur in the ordinary course of business. The directors constantly review the business
models of the Group and its operating subsidiaries to ensure sustainability and the ability to operate
profitably and generate positive cash flows. Funding facilities are also reviewed regularly to ensure that
the Group has sufficient facilities in place to finance its operations.
10. Basic, Dilutive and Headline Loss per share
The basic and dilutive loss and weighted average number of ordinary shares used in the calculation of
basic loss per share is as follows:
Basic and dilutive loss per share
The basic loss and weighted average number of ordinary shares used for calculation purposes comprise
the following:
Basic and dilutive loss per share 31 December 31 December
2017 (GBP) 2016 (GBP)
Loss for the period attributable to equity holders of (3,712,707) (3,611,496)
the parent
Weighted average number of ordinary shares for 372,255,127 351,080,645
the purposes of basic loss per share
Basic loss per ordinary share (0.010) (0.010)
As the exercise price of the share options and warrants in issue is higher than the current market value as
at reporting date, these option and warrants do not have a dilutive impact. Thus, there are no dilutive
share options or warrants in issue as at year end which decreased the basic loss per share as indicated
above.
Headline loss per share
Reconciliation of headline loss per share:
31 December 31 December
2017 (GBP) 2016 (GBP)
Loss for the period attributable to normal shareholders (3,712,707) (3,611,496)
Reversal of impairment of Intangible assets/ (Impairment of Intangible - -
assets)
Loss on disposal of subsidiaries - -
Bargain purchase from acquisition of Subsidiaries - -
Adjustment arising from change in non-controlling interest - -
Impairment of goodwill on acquisition of Subsidiaries - -
Headline loss for the period attributable to normal shareholders (3,712,707) 3,611,496)
Headline loss per ordinary share (0.010) (0.010)
11. Called up share capital and share premium
Details of authorised and issued capital are as follows:
2017 2016
Authorised equity
1,000,000,000 (2016: 1,000,000,000) Ordinary shares of EUR0.015 each EUR15,000,000 EUR15,000,000
3,000,000,000 deferred shares of EUR0.009 each EUR27,000,000 EUR27,000,000
EUR42,000,000 EUR42,000,000
Allotted, issued and fully paid shares
(2017: 395,254,364 Ordinary shares of EUR0.015 each) GBP4,758,595 -
(2016: 363,976,596 Ordinary shares of EUR0.015 each) - GBP4,346,890
1,291,394,535 Deferred shares of EUR0.009 each GBP9,257,075 GBP9,257,075
GBP14,015,670 GBP13,603,965
Ordinary Deferred
Share Share Share Treasury
Number of Capital Capital Premium shares
Shares (GBP)* (GBP) (GBP) (GBP)*
Balance at 31 December 2016 363,976,596 4,346,890 9,257,075 27,318,262 -
Shares issued during the period 31,277,768 411,705 - 1,151,488 -
Balance at 31 December 2017 392,254,364 4,758,595 9,257,075 28,469,750 -
12. Condensed Consolidated Segmental Analysis
Management currently identifies two divisions as operating segments - mining and corporate. These
operating segments are monitored and strategic decisions are made based upon them together with other
non-financial data collated from exploration activities. Principal activities for these operating segments
are as follows.
2017 Group Mining and 31 December
Exploration Corporate 2017 (GBP)
Group Group Group
Revenue - - -
Administrative cost - (1,871,697) (1,871,697)
Capital raising fees - (908,543) (908,543)
Exploration expenditure (1,741,018) - (1,741,018)
Investment and other income 1,445 - 1,445
Tax - - -
Loss after tax (1,739,573) (2,780,240) (4,519,813)
2016 Group Mining and 31 December
Exploration Corporate 2016 (GBP)
Group Group Group
Revenue 18,039 - 18,039
Administrative cost - (1,653,152) (1,653,152)
Capital raising fees - (1,648,004) (1,648,004)
Exploration expenditure (1,716,967) - (1,716,967)
Investment and other income 1,414,668 1,414,668
Tax - - -
Profit/ (Loss) after tax 284,260 (3,301,156) (3,585,416)
2017 Group 31 December
Mining Corporate 2017 (GBP)
Group Group Group
Assets 18,423,284 6,103 18,429,387
Segment assets
Liabilities 264,562 1,297,505 1,562,066
Segment liabilities
Other Significant items
Depreciation 2,738 - 2,738
2016 Group 31 December
Mining Corporate 2016 (GBP)
Group Group Group
Assets
Segment assets 18,015,412 22,772 18,038,184
Liabilities
Segment liabilities 111,376 402,595 513,971
Other Significant items
Depreciation 8,228 - 8,228
13. Changes to the board of Kibo Mining Plc
No changes were made to the board during the current financial year.
By order of the Board
14 June 2018
Directors:
Christian Schaffalitzky Chairman (Non-Executive)
Louis Coetzee Chief Executive Officer (Executive)
Noel O'Keeffe Technical Director (Non-Executive)
Andrew Lianos Finance Director (Non-Executive)
Lukas Marthinus Maree Executive Director
Wenzel Kerremans Non-Executive Director
Company Secretary: Noel O'Keeffe
Auditors: Saffery Champness LLP
For further information please visit www.kibomining.com or contact:
Louis Coetzee louisc@kibomining.com Kibo Mining Plc Chief Executive Officer
Andreas Lianos +27 (0) 83 4408365 River Group Corporate Adviser and
Designated Adviser on JSE
Ben Tadd / +44 (0) 20 3700 0093 SVS Securities Joint Broker
Tom Limited
Curran
Jon Belliss +44 (0) 20 7399 9400 Novum Securities Joint Broker
Ltd
Andrew Thomson +61 8 9480 2500 RFC Ambrian NOMAD on AIM
Limited
Isabel de Salis / +44 (0) 20 7236 1177 St Brides Partners Ltd Investor and Media
Priit Piip Relations Adviser
This announcement contains inside information as stipulated under the Market
Abuse Regulations (EU) no. 596/2014 ("MAR").
Notes to editors
Kibo is a multi-asset resource development and energy company with a long-term goal of
becoming a leading power producer in Sub-Saharan Africa. The Company aims to tackle
the acute power deficit which is severely hindering economic development in the region.
Kibo's flagship asset is the Mbeya Coal to Power Project ('MCPP') in Tanzania, which
comprises the Mbeya Coal Mine, a 1.5Mt p/a mining operation, and the Mbeya Power
Plant, a 300MW mine-mouth thermal power station. The Mbeya Coal Mine has a defined
120.8 Mt NI 43 101 thermal coal resource. A Definitive Feasibility Study has been
conducted on the project which underpinned its value and confirmed an initial rate of
return of 69.2%. The 300MW mouth-of-mine thermal power station has long term
scalability with the potential to become a 1000MW plant. The completed full Power
Feasibility Study highlighted a power output target of 1,800 GWh/a based on annual
average coal consumption of 1.5Mt. An Integrated Bankable Feasibility Study report for
the entire project indicated total potential revenues of US$ 7.5-8.5 billion over an initial
25-year mine life, post tax equity IRR between 21-22%, debt pay-back period of 11-12
years and a construction period of 36 months.
To assist in the execution of this critical power project of the MCPP, Kibo has assembled
an international team of advisors and partners including Engineering Procurement and
Construction ('EPC') contractors and financial teams that are assisting in the advancement
and development of the MCPP. These include ABSA/Barclays as Financial Advisor,
China based EPC contractor SEPCO III, General Electric, Tractebel Engineering (Power),
Minxcon Consulting (Mining) and legal advisors Norton Rose Fulbright.
Kibo also has an 85% interest in the Mabesekwa Coal Independent Power Project
('MCIPP'), a nearly identical power project in Botswana. The project consists of 300Mt
subset of the current in-situ 777Mt Coal Resource and has water and land use permits and
environmental certification in place. A Pre-Feasibility Study on the coal mine has been
completed, as has a Scoping Study, which highlight the power plant having a maximum
capacity of 600MW (4x150MW) based on a coal delivery rate of 3.2Mtpa and a Life of
Mine of over 30 years.
Johannesburg
14 June 2018
Corporate and Designated Adviser
River Group
Date: 14/06/2018 09:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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