Wrap Text
Notice of Annual General Meeting
Audited results for the year ended 30 June 2018
Jubilee Metals Group PLC
Registration number (4459850)
AltX share code: JBL
AIM share code: JLP
ISIN: GB0031852162
("Jubilee" or "the Company")
Notice of Annual General Meeting
Audited results for the year ended 30 June 2018
The directors of Jubilee are pleased to release its audited results for the year ended 30 June 2018.
NOTICE OF ANNUAL GENERAL MEETING
The Company also hereby gives notice of the Company’s 2018 Annual General Meeting, which
will be held on 6 December 2018 at 11:00 am UK time at Fladgate LLP, 16 Great Queen Street,
London, WC2B 5DG to transact the business as stated in the notice of Annual General Meeting.
The Group’s Annual Report for the year ended 30 June 2018 has been posted to the website,
www.jubileemetalsgroup.com, with the notice of the Company’s 2018 Annual General Meeting.
Shareholders are advised that the Notice of Annual General Meeting, including a Form of
Proxy, for the year ended 30 June 2018 has been posted to Jubilee shareholders today, 14
November 2018.
FINANCIAL HIGHLIGHTS
• Combined project revenue up 44.14% to £ 14.14 million (ZAR: 245.53 million) [2017: £
9.81 million (ZAR 166. 97 million)]
• Combined project attributable earnings up 206% to £ 5.03 million (ZAR 86.80 million)
[2017: £ 1.64 million (ZAR 28.20 million)]
• Group delivers positive cash flow from operating activities of £ 0.96 million (ZAR 17.44
million) [(2017: negative cash flow of £ 0.53 million (ZAR 9.16 million)]
• Group revenue up 44.14% to £ 14.14 million (ZAR: 245.53 million) [2017: £ 9.81 million
(ZAR 166. 97 million)]
• Group operating expenses before impairments and non-cash, down 30.82 % to £ 1.92
million (ZAR 33.34 million) [(2017: £ 2.77 million (ZAR 47.87 million)]
• Group operating profit of £ 0.06 million (excluding impairments in an amount of £ 0.80
million) (ZAR: 1.04 million) [2017: loss of £ 1.67 million (ZAR 28.89 million) (excluding
impairments in an amount of £ 18.57 million)]
• Group loss per share reduced by 83.63 % to 0.18 pence per share (ZAR 1.88 cents) [(2017:
1.07 pence (ZAR 18.55 cents)]
OPERATIONAL HIGHLIGHTS FOR THE PERIOD UNDER REVIEW
• Hernic Operations achieved PGM1 production of 17 354 (2017: 808 ounces) ounces for
the year, generating revenue of £ 9.5 million (ZAR 164 366 million) [(2017: £
0.46 million) (ZAR 7.60 million)]
• DCM Operations achieved Chrome production of 46 191 tonnes (2017: 78 588 tonnes)
for the year, generating revenue of £ 4.62 million (ZAR 80.05 million) [(2017: £ 9.50
million (ZAR 162.04 million)]
• DCM Operations commenced with the construction of state of the art fine chrome
recovery plant with a targeted processing capacity of 300 000 tonnes per annum
• PlatCro PGM project commenced with the construction of the dewatering and
classification circuit to facilitate the ramp up to 720 000 tonnes per annum of the delivery
of PGM rich material to Northam Platinum’s Eland Platinum operation with PGM
production targeted to commence in Q1 2019
• Tjate PGM project progressed the implementation of the social labour plan with the
construction of an expanded water reticulation system to service the Tjate community
targeting commissioning in Q4 2018
• Jubilee executed agreement to gain sole processing rights of the Kabwe zinc, lead and
vanadium project in Zambia through Kabwe Operations agreement and acquiring a
29.01% interest in BMR increasing Jubilee’s effective interest in the Zambian Kabwe
Project to 57.41% (91.10% post the period under review)
1= 6 Element Platinum Group Metals (platinum, palladium, rhodium, ruthenium, iridium + gold)
2= For income statement purposes conversions are at the average £:ZAR rates for the period under review and for balance sheet
purposes at the spot rate as at year end. All other conversions are at rates at the time announced.
OPERATIONAL HIGHLIGHTS POST THE PERIOD UNDER REVIEW
• Hernic Operations reaches 8 551 ounces of PGM concentrate produced in first four
months following the period under review (increase of 96 % compared to the similar
period in 2017)
• Jubilee increases its effective beneficial interest in the Kabwe Project to 91.10% in the
Kabwe Project
• DCM Operations nears completion of the state of the art fine chrome recovery processing
plant targeting commissioning in Q4 2018
• PlatCro PGM project nears completion of the dewatering and classification (“Feed prep”)
circuit to ramp-up deliveries to Northam Platinum’s Eland operations. Targeting
completion of Feed prep circuit in Q4 2018 and commencing PGM production in Q1 2019
• Kabwe zinc, lead and vanadium project concludes its execution strategy, first targeting
the completion of the zinc refinery prior to the lead and vanadium circuit. The zinc
refinery circuit includes the potential of securing exclusive access and revamping of an
existing zinc refinery circuit to accelerate the production of zinc metal
OVERVIEW
Jubilee has delivered another strong operational performance during the period under review
which continued post this period.
In addition Jubilee continued to grow its project pipe line of surface metal recovery projects
expanding both in South Africa and into Africa through its Zambian acquisitions. Jubilee’s project
pipe-line contains a diversified metals of Chrome, PGMs, Zinc, Lead and Vanadium. This project
pipe-line supports Jubilee’s drive to diversify its earnings generation and is well buffered against
metal price fluctuations operating at the low end of the metal production cost curve in the absence
of any mining related costs.
Jubilee is actively pursuing further metal recovery projects. Jubilee’s brand is gaining strength on
the back of our successful track record and is engaging with global mining companies to target
the formation of strategic relationships.
In line with Jubilee’s strategy to rapidly grow its surface metal recovery project pipe line, Jubilee
has executed framework agreements and non-disclosure agreements with large global mining
companies to define the metals recovery opportunities and prepare an asset waste portfolio for
these companies.
The Company has successfully responded to the current challenges and risks inherent to a metals
production business that also holds an exploration asset and will continue to formulate
preventative measures.
JUBILEE’S METALS RECOVERY PROJECTS
HERNIC OPERATIONS – SOUTH AFRICA
The Hernic Operation targets the recovery of platinum group metals and chrome contained in
surface material. The metals recovery operation avoids any exposure to mining risk.
The Hernic Operation is the second of the Company's operating platinum-bearing surface tailings
projects and targets processing in excess of 600 000 tonnes tailings per year. The project has access
to an estimated 3 000 000 tons of surface platinum containing material, to which Hernic continues
to add further material. The project, which is estimated to contain in excess of 224 000 (3PGM +
Au) ounce in the historical tailings alone, is one of the largest PGM beneficiation plant in South
Africa to process surface chrome tailings. Jubilee was awarded the exclusive right to process and
recover the chrome and PGM’s from these surface tailings.
The Hernic Operation was constructed and commissioned within budget and on time. Key project
milestones were:
• Concluded construction January 2017
• First Chrome production February 2017
• First Platinum production March 2017
• Positive project earnings from June 2017
• Consistent project earnings growth quarter on quarter reaching £1.92 million (ZAR 35.52
million) in Q3 2018 alone
• Unit cost of production below USD 400 per PGM ounce produced
• Achieved record monthly production of PGMs reaching 2 542 PGM ounces in October
2018
Jubilee strives at all times to provide a safe working environment for its employees and stake
holders and achieved a safety performance for the period under review of 183 903 of no lost time
injury hours worked.
The graph below depicting the quarter on quarter project performance, illustrates the continuous
step improvement achieved by the project.
The Jubilee attributable earnings shows that the project turned profitable within 2 months of
commencing operations and within 16 months of commencing with project capital expenditure.
The Hernic Operation continues to offer further upside in the performance by targeting increased
feed supply to the chrome and PGM recovery circuits.
The table below presents the operational performance of the Hernic Operation for the period under
review (The Hernic Operation was commissioned during March 2017 with operations only
commencing during Q2 of 2017):
Jubilee Jubilee Unit cost/
Tailings PGM Project Project Project Project attributable attributable PGM
processed ounces revenue1 revenue2 earnings3 earnings earnings earnings ounce
tonnes delivered (£’000) (ZAR’000) (£’000) (ZAR’000) (£’000) (ZAR’000) (USD)
Q2 2017 80 828 808 459 7.604 (110) (1.928) (110) (1.928) 901
FY 2017 80 828 808 459 7.604 (110) (1.928) (110) (1.928) 901
Q3 2017 105 673 2 943 1.539 26.581 562 9.725 562 9.725 460
Q4 2017 121 644 3 708 2.047 37.011 954 17.291 954 17.291 390
Q1 2018 110 409 4 894 2.651 44.013 1.141 18.897 1.141 18.897 430
Q2 2018 119 479 5 810 3.308 56.761 1.635 28.059 1.635 28.059 410
FY 2018 457 204 17 354 9.546 164.366 4.291 73.972 4.291 73.972
Q3 2018 135 146 6 009 3.356 61.785 1.920 35.523 1.920 35.523 311
1= Revenue from the current project phase – 100 % attributable to Jubilee until full capital recovery. Revenue is projected based on
latest average PGM market prices and USD exchange rates and results are only final once final Quotational Period has passed
2= Average monthly conversion rates used
3= Project Earnings include all incurred operational costs, management services and mineral royalties
DILOKONG CHROME MINE (DCM) OPERATIONS – SOUTH AFRICA
Jubilee’s subsidiary, Jubilee Tailings and Treatment Company Proprietary Limited (“JTTC”) holds
the exclusive rights to beneficiate the PGMs and chrome from the platinum and chrome-containing
surface material at DCM. The agreement between DCM and JTTC gives Jubilee access to more
than 850 000 tons of surface material containing an estimated 74 000 ounces 4E PGM (elements
platinum, palladium, rhodium and gold).
During the period under review, and in an ongoing co-operation with DCM, Jubilee executed a
new framework treatment of tailings and chrome ore agreement (“New Agreement”) with DCM,
thereby cancelling and superseding all existing agreements in respect of chrome processing and
PGM recovery at DCM. The New Agreement transforms Jubilee’s DCM operations as an equal
joint venture with DCM, on all chrome ore including 3rd party chrome ore. This New Agreement
now affords Jubilee the right to 50 % of all chromite earnings generated including from the
processing of third party or other Chromite Ore. This New Agreement captures the growth of the
DCM Project from initially Jubilee holding no rights to earnings from chromite ore at the outset of
the DCM Project to a 50/50 joint venture with DCM. The New Agreement further secures Jubilee’s
unencumbered PGM rights from all material processed at DCM irrespective of source.
DCM Operation
The DCM operations maintained a strong safety performance achieving 219 761 of no lost time
injury hours worked.
During the period under review the DCM operations produced 46 191 tonnes of saleable chrome
concentrate. Jubilee expects to deplete the initial coarse recoverable chrome from the tailings
material during Q4 2018. In-line with the expected reduced chrome production Jubilee commenced
with the construction of a state of the art fine chrome recovery circuit targeting the fine chrome
available in the approximate 1 000 000 tonnes of surface material. This new highly automated
circuit is targeted to commence commissioning during Q4 2018 ramping up to a processing rate of
300 000 tonnes per annum. The fine chrome circuit will be an industry first and Jubilee expects to
deploy the solution to its other operations. If offers the unique benefit of targeting the recovery of
chrome previously discarded to the waste streams which opens a new potential source of chrome.
During the period under review the DCM operations performed to plan with its second full year
of operation despite challenging market conditions and pressure on the chrome price. Jubilee
looks forward to bringing its new fine chrome recovery plant into full operation during the first
quarter of 2019.
The table below presents the operational performance of the DCM operations for the period under
review:
Chromite Jubilee Jubilee
concentrate Project Project Project Project attributable attributable
produced revenue revenue1 earnings2 earnings earnings earnings
tonnes (£’000) (ZAR’000) (£’000) (ZAR’000) (£’000) (ZAR’000)
Total Q3 2016 26 848 2.141 38.368 1.581 28.320 587 10.505
Total Q4 2016 19 108 2.642 45.714 1.714 29.668 368 6.367
Total Q1 2017 14 973 3.372 55.224 2.407 38.862 408 6.664
Total Q2 2017 17 659 1.348 22.731 386 6.504 399 6.727
FY 2017 78 588 9.503 162.037 6.088 103.354 1.762 30.263
Total Q3 2017 15 134 1.129 19.526 376 6.474 381 6.562
Total Q4 2017 11 788 1.254 22.858 515 9.308 257 4.654
Total Q1 2018 9 810 1.240 20.628 243 4.033 121 2.016
Total Q2 2018 9 461 993 17.036 -47 -807 -24 -404
FY 2018 46 191 4.616 80.048 1.086 19.007 736 12.829
1 = Average monthly conversion rates used
2 = Project earnings include project expenditure on plant and equipment
3 = Figures as announced, which can differ from annual audited figures due to conversion at the time of the announcement being
different to conversion for the whole period under review.
PLATCRO PROJECT - SOUTH AFRICA
Jubilee holds the rights to PlatCro’s estimated 1 900 000 tonnes of new platinum-bearing surface
material containing an estimated 2.7 g/t 4E PGMs (platinum, palladium, rhodium and gold) as well
as all future platinum bearing material processed.
Jubilee entered into a processing agreement (“the Agreement”) with Eland Platinum Proprietary
Limited (“Eland Platinum”), a subsidiary of Northam Platinum Limited, for the further refining of
the PGM rich surface material. The Agreement is on the basis that Jubilee will deliver its platinum
rich PlatCro material, post chrome removal, to Eland Platinum at a targeted rate of 60 000 tonnes
per month. All capital associated with the refurbishment of Eland Platinum’s platinum recovery
plant will be carried by Eland Platinum.
It is expected that the Eland Platinum processing plant will commence processing of the Jubilee
material from February 2019 ramping up to a targeted rate of 60 000 tonnes per month at an agreed
fixed processing cost. In return Eland Platinum will acquire the platinum material from Jubilee
and recover the contained PGMs at a targeted rate of approximately 2 800 PGM ounces per month.
All earnings generated by the sale of the recovered PGM ounces will be shared at an agreed earning
split, with Jubilee retaining a majority of the earnings.
Jubilee has commenced the construction of the dewatering and classification circuit at PlatCro to
facilitate the ramp up of deliveries to Eland Platinum. The project remains on track to commence
the production of PGMs during Q1 2019.
KABWE PROJECT – ZAMBIA
The Kabwe Project provides Jubilee a position in Zambia offering a potential to lead, zinc and
vanadium contained in historical surface mine tailings and discards. JORC compliant lead and zinc
in Kabwe Dumps is estimated at 164 000 tonnes of zinc and 272 000 tonnes of lead excluding the
further significant non-JORC compliant surface resources and the contained vanadium estimated
to contain 6 400 000 tonnes of lead, zinc and vanadium rich material at surface
During the period under review Jubilee acquired 29.01% of BMR and executed agreements with
BMR where Jubilee would provide access to funding for the Kabwe Operations to the value of £
300,000 to secure a 15% equity interest in Kabwe Operations held as a Preferred Share. The funding
will be utilised towards the confirmation by Jubilee of the initial design, work programme and
budget for construction of the Kabwe Project.
Post the period under review, the agreements for the Kabwe Project were updated (“Updated
Agreements”) to better align with Jubilee’s role to deliver a successful project. The Updated
Agreements places Jubilee in full control of the execution methodology and funding requirements
to bring the project to account. In return Jubilee will hold a minimum of 87. 5% shareholding in
Kabwe Operations assigned with all intellectual property developed for the execution of the Kabwe
Project as well as the right to fund and execute the Kabwe Project.
Jubilee also holds a further option, at its sole election, to acquire 100% of the issued shares of EML,
a subsidiary of BMR and the company that owns the Project through BMR’s Zambian based EPL.
BMR will hold either the remaining 12, 5% shareholding in Kabwe Operations or should Jubilee
acquire EML outright a 12, 5% share of earnings generated by the Kabwe Project (“Royalty”).
Such Royalty payments will only be due and payable by the Kabwe Project once Jubilee has
secured a minimum of a 20% rate of return on the investment made into the Project and only once
EPL or Kabwe Operations have received all generated earnings in cash.
Post the period under review Jubilee concluded the process review and project implementation
strategy. The strategy includes separating the zinc and lead recovery circuits and completing first
the zinc recovery circuit. The option is being considered to gain exclusive access to a nearby zinc
refinery currently under care and maintenance. This option would include refurbishing the existing
refinery which significantly reduces the project time line to commence production of zinc. The
tailings from the zinc circuit would be fed to a new constructed lead recovery circuit for the
production of a lead concentrate. The final decision on whether access to the zinc refinery can be
secured is expected during Q4 2018, failing which Jubilee will accelerate the construction of a
dedicated zinc recovery circuit at the EPL Kabwe property.
Jubilee further holds the right as part of the existing agreements with BMR to offer tolling refining
services to future zinc ore from the large scale exploration rights also held under EPL. BMR has
entered into a joint venture agreement with Galileo Resources to further the exploration of these
assets. Initial drilling results have confirmed the potential of significant shallow zinc resources
suited for further refining by the Jubilee proposed zinc recovery circuit.
TJATE PLATINUM PROJECT – SOUTH AFRICA
Tjate was awarded a Mining right granted 2 March 2017 for the mining of platinum group metals
and associated base metals and chrome on three farms Quartzhill, Fernkloof and Dsjate totalling
some 5 100 hectares, which comprise the Project. The Project covers the feasibility of the
development of a medium size underground mine to extract the Merensky and UG2 reefs
containing platinum group minerals, chromite and other associated metal ores. The Project
property’s farms are down dip of Impala Platinum’s operating Marula platinum mine and of Anglo
Platinum’s developing Twickenham platinum mine.
Jubilee commissioned an independent review and update of the project and economics in order to
assess the most suitable and appropriate way forward for the project.
Jubilee on behalf of Tjate has progressed with the implementation of the Social Labour Program
during the period under review. The activities included the construction of an expanded water
storage reticulation system to service the Tjate community.
CHAIRMAN’S STATEMENT
Dear shareholder,
Our stated mission is to establish Jubilee as a leading global player in the recovery of metals from
surface material previously regarded as waste or discard by applying project appropriated cutting
edge metallurgical solutions. This mission, while remaining free of any mining risk, secures
Jubilee access to low capital, quick to market projects diversified across metals and country.
Reflecting on the period under review I am proud to report that Jubilee has demonstrated it progress
in delivering this mission. We responded aggressively to market dynamics by solidifying our
existing earnings generative projects and focussing on efficiencies to fully capture the benefit from
strong palladium and rhodium prices included in the PGMs produced, while diversifying our
project portfolio to include the energy associated metals such as vanadium and zinc in Zambia.
The year under review has seen significant progress made by Jubilee both operationally, delivering
record earnings and associated PGM ounces, as well as strategically with Jubilee expanding its
operational footprint and diversifying into energy related base metals associated with acquisition
of the Kabwe project in Zambia.
Our Hernic operation’s quarterly published results confirmed the project as one of the premier
projects in the arena achieving a unit cost per PGM ounce produced of below USD 400. Hernic
delivered 17 354 ounces for the 12 months period of under review. At the time of writing this
report, the Company has announced the monthly production of PGMs for October alone this year
to be some 2 542 ounces, which is in excess of the forecasted production rate.
At our DCM operation, we announced on 5 September 2017 a new partnership agreement with
DCM. The agreement gave Jubilee an increase from 0 to 50 % in all chrome produced from the
DCM operation and also extended Jubilee’s sole right to all PGMs from material at DCM
irrespective of source.
With the depletion of coarser chrome in the surface stock Jubilee commenced the construction of
a state of the art fine chrome recovery circuit targeting the recovery of the significant quantity of
fine chrome remaining in the more than 1 000 000 tonnes surface stock at DCM. We anticipate
that the fine chrome recovery project will be commissioned during the 4th quarter 2018. The
completion of this project is expected to significantly enhance revenues and earnings from the
DCM Project. The DCM fine chrome recovery plant will capture chrome currently being lost prior
to the introduction of the capability. This loss is common to the industry and the Company
considers this process capability to be generally marketable within the chrome industry of South
Africa.
The Company has aggressively pursued its decision to provide a country and commodity hedge.
The first move in this direction was with the BMR in Zambia. BMR’s Zambian subsidiary, Enviro
Processing Limited, holds the rights to the secondary materials at the former Kabwe mine in
Zambia. The initial intent was to joint venture with BMR, with Jubilee providing the expertise and
initial financing to develop a small plant, with Jubilee enjoying a 40 % share of profits.
We announced on 15 January 2018 that we had acquired a 29.01 % in the enlarged issued share
capital of BMR. The effect of this acquisition was to increase our overall beneficial interest in the
Kabwe Project to 51.41 %. This decision was inspired by our confidence in the Project and its
potential future opportunities. The holding in BMR was supported by our intent to make other
dump and secondary material acquisitions in Zambia using BMR as our initial footprint and
platform for progression.
On 7 February 2018 we were advised by BMR that the Zambian government had terminated, with
immediate effect, BMR’s mining right to the Kabwe operation with 30 days to appeal. Jubilee and
BMR worked diligently together in an appeal to reinstate the license and announced on 5 April
2018 that the license has been reinstated, effective immediately, by the Minister of Mines and
Mineral Development. This reinstatement of the mining license paved the way for Jubilee and BMR
to commence joint execution of the Project. Post balance sheet, Jubilee announced that it had gained
full control of the Kabwe Project by increasing its stake to 87. 5 % with an option to acquire 100
% of the Kabwe Project, while BMR retains a maximum of 12.5 % of generated earnings after
Jubilee has first secured a return on its project capital. The Jubilee board is convinced that this
acquisition will represent a major step in its stated mission to take its brand into the global arena.
The mission being, to secure projects, which are low risk with high operating margins and no
exposure to mining or exploration risk. In pursuing this mission, Jubilee have assembled an
enviable project pipeline ranging across a range of commodities and secondary material types. A
number of projects have advanced to final negotiation stage and we look forward to further
announcements in this regard in the near future.
One of the key necessities to pursue this mission is that of finance and to this end, Jubilee secured
a USD 50 million project funding agreement as announced on 9 August 2017. The key feature of
this funding is that it will be directed at asset level and will be drawn down based on individual
project criteria. This initial funding arrangement is for a 33 month period with options to extend
and/or increase the level of commitment. Jubilee has been active throughout the year in establishing
a network of various institutional individual investors who recognise the brand and management
vision in respect of dump and secondary material treatment on a global basis.
Jubilee at the time of writing this report has the technical, engineering and financing capability to
execute projects of a similar size to the projects already in our arsenal, should the fundamentals
permit. Our brand and model will allow third party major resource companies to clean up their
secondary material problems, receiving significant income without capital risk. The strength of this
model is supported by the level of enquiry and interaction currently being experienced by Jubilee
in this particular field.
I firmly believe that 2019/2020 will see inflation continue, apace producing a supportive
environment for commodities, with demand increasing and ability to supply being limited with the
outcome of general price increases. Our project line does not require either extended time or capital
to implement new projects and as such we will be able to take full and quicker advantage over
companies who have to embark upon primary mining activities to meet the new metal demand.
On 21 June 2018 we announced the retirement of Andrew Sarosi from the board. The decision of
Andrew Sarosi to step down from the board was a sad moment in the Company’s history since his
untiring efforts, intellectual contribution and sheer hard work will be sorely missed. We wish
Andrew Sarosi well in his retirement and we thank him for his exemplary contribution. Andrew
Sarosi has been replaced by Dr Evan Kirby, who has a wide experience in our industry and has
operated in a senior level therein. Like Andrew, Dr Kirby is a metallurgical engineer and therefore
his contribution will have significant impact on decisions being made going forward. We welcome
Dr Kirby to the board.
Finally, I would like to thank everyone concerned with the sterling effort, which has produced two
highly cash generative projects and a pipeline of enviable future investments. I look forward to the
next year producing even stronger earnings and several of our pipeline project being consummated.
Colin Bird
Group annual financial statements
Group statement of financial position
as at 30 June 2018
Figures in Sterling 2018 2017
Assets
Non-current assets
Property, plant and equipment 10 364 239 13 161 021
Intangible assets 44 385 596 48 166 942
Investments in associates 2 760 966 –
Other financial assets 509 229 –
58 020 030 61 327 963
Current assets
Inventories 1 306 000 44 789
Other financial assets 424 753 –
Current tax receivable 15 870 15 870
Trade and other receivables 3 293 938 3 222 150
Cash and cash equivalents 6 376 153 4 635 636
11 416 714 7 918 445
Total assets 69 436 744 69 246 408
Equity and liabilities
Equity attributable to equity
holders of parent
Share capital and share premium 94 065 073 87 674 940
Reserves 21 432 114 23 078 043
Accumulated loss (59 057 860) (57 261 760)
56 439 327 53 491 223
Non-controlling interest 2 363 401 2 867 039
58 802 728 56 358 262
Liabilities
Non-current liabilities
Other financial liabilities 1 622 026 688 000
Deferred tax liability 5 065 422 5 362 500
6 687 448 6 050 500
Current liabilities
Other financial liabilities 1 448 664 3 083 581
Trade and other payables 2 497 904 3 754 065
3 946 568 6 837 646
Total liabilities 10 634 016 12 888 146
Total equity and liabilities 69 436 744 69 246 408
The financial statements were authorised for issue and approved by the Board on 14 November
2018 and signed on its behalf by:
Leon Coetzer
Chief Executive Officer
Company number: 04459850
Group statement of comprehensive income
for the year ended 30 June 2018
Figures in Sterling 2018 2017
Continuing operations
Revenue 14 139 510 9 805 701
Cost of sales (8 672 325) (8 038 731)
Gross profit 5 467 185 1 766 970
Other income 9 227 348
Operating expenses1 (5 416 827) (3 439 040)
Operating profit/(loss) 59 585 (1 671 722)
Investment revenue 25 586 18 673
Impairments (804 357) (18 570 584)
Finance costs (1 375 732) (198 565)
Share of loss from associates (308 451) –
Loss before taxation (2 403 369) (20 422 198)
Taxation – 9 849 606
Loss for the year (2 403 369) (10 572 592)
Other comprehensive income:
Exchange differences on
translating foreign operations (2 954 327) 6 104 352
Total comprehensive loss (5 357 696) (4 468 240)
Basic loss for the year
Attributable to:
Owners of the parent (2 114 713) (10 570 058)
Non-controlling interest (288 656) (2 534)
(2 403 369) (10 572 592)
Total comprehensive loss
attributable to:
Owners of the parent (4 892 637) (4 878 961)
Non-controlling interest (465 059) 410 721
(5 357 696) (4 468 240)
Basic loss per share (pence) (0.18) (1.07)
Group statement of changes in equity
for the year ended 30 June 2018
Total
attributable
Share Foreign Share- to equity
capital and currency based holders of Non-
share translation Merger payment Total Accumulated the Group/ controlling Total
Figures in Sterling premium reserve reserve reserve reserves loss Company interest equity
Group
Balance at 1 July 2016 82 515 169 (7 133 637) 23 184 000 1 947 350 17 997 713 (46 799 126) 53 713 756 2 456 317 56 170 073
Changes in equity
Total comprehensive income for the year – 5 691 097 – – 5 691 097 (10 570 058) (4 878 961) 410 721 (4 468 239)
Issue of share capital net of costs 5 159 771 – – – – – 5 159 771 – 5 159 771
Warrants issued – – – 22 025 22 025 – 22 025 – 22 025
Warrants exercised – – – (632 792) (632 792) 632 792 – – –
Increase in investments – – – – – (525 367) (525 367) - (525 367)
Total changes 5 159 771 5 691 097 – (610 767) 5 080 330 (10 462 633) (222 532) 410 721 188 190
Balance at 30 June 2017 87 674 940 (1 442 540) 23 184 000 1 336 583 23 078 043 (57 261 760) 53 491 223 2 867 039 56 358 262
Changes in equity
Total comprehensive income for the year - (2 777 924) - - (2 777 924) (2 114 713) (4 892 637) (465 059) (5 357 696)
Issue of share capital net of costs 7 258 327 - - - - - 7 258 327 - 7 258 327
Warrants issued (868 194) - - 868 194 868 194 - - - -
Options issued - - - 263 801 263 801 - 263 801 - 263 801
- - - - 318 612 318 612 (38 578) 280 034
Changes in ownership interest – control not lost -
Total changes 6 390 133 (2 777 924) - 1 131 995 (1 645 929) (1 796 101) 2 948 103 (503 637) 2 444 466
Balance at 30 June 2018 94 065 073 (4 220 464) 23 184 000 2 468 578 21 432 114 (59 057 860) 56 439 327 2 363 401 58 802 728
Group statement of cash flows
for the year ended 30 June 2018
Figures in Sterling 2018 2017
Cash flows from operating activities
Cash used in operations 1 406 936 (160 100)
Interest income 25 586 18 673
Finance costs (469 548) (384 935)
Net cash from operating activities 962 974 (526 362)
Cash flows from investing activities
Purchase of property, plant and equipment (195 208) (7 161 323)
Sale of property, plant and equipment 9 056 19 145
Purchase of intangible assets (191 743) (37 685)
Investment in associate (500 000) –
Loans to group companies – –
(Repayment)/receipt of loans (841 087) 555 159
Advance payment for tailings material – (1 179 220)
Net cash from investing activities (1 718 982) (7 803 924)
Cash flows from financing activities
Net proceeds on share issues 4 252 950 5 159 771
Repayment of other financial liabilities (3 518 298) (2 986 434)
Proceeds from other financial liabilities 1 920 000 6 135 647
Net cash from financing activities 2 654 652 8 308 984
Total cash movement for the year 1 898 644 (21 302)
Total cash at the beginning of the year 4 635 636 4 414 908
Effect of exchange rate movement on cash balances (158 127) 242 030
Total cash at end of the year 6 376 153 4 635 636
NOTES TO THE GROUP FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2018
1. Statement of accounting policies
The Group and Company results for the year ended 30 June 2018 have been prepared using the
accounting policies applied by the Company in its 30 June 2017 annual report which are in accordance
with 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 the
Companies Act 2006 (UK). They are presented in Pound Sterling.
This financial report does not include all notes of the type normally included in an annual financial
report. Accordingly, this report is to be read in conjunction with the annual report for the year ended
30 June 2018 and any public announcements by Jubilee Platinum PLC after that date to the date of
publication of these results.
All monetary information is presented in the functional currency of the Company being Great British
Pound. The Group’s principal accounting policies and assumptions have been applied consistently
over the current and prior comparative financial period. The financial information for the year ended
30 June 2017 contained in this report does not constitute statutory accounts as defined by section 435
of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the
Registrar of Companies. The auditor’s report on those accounts was unqualified did not contain a
statement under section 498(2)-(3) of the Companies Act 2006.
2. Financial review
Jubilee reports its first profit from operations of £0.06 million compared to a loss of £ 1.67 million
for the 2017 financial year. Positive cash flow from operating activities of £ 0.96 million compared
to a negative cash from operations of £ 0.53 million in the 2017 financial year, confirms the cash
positive performance of its current projects.
Earnings per ordinary share for the year ended 30 June 2018 were as follows:
June 2018 June 2017
Basic loss for the year (£’000) (2 115) (10 570)
Weighted average number of shares in issue (‘000) 1 203 479 984 780
Loss per share (pence) (0.18) (1.07)
Loss per share (ZAR cents) (3.05) (18.55)
The Group reported a net asset value of 4.49 pence (ZAR 81.49 cents) (2017: 5.04 pence
(ZAR 85.54 cents) per ordinary share. Tangible net asset value for the period under review was 1.10
pence (ZAR 19.98 cents) ((2017: 0.73 pence) (ZAR 12.42 cents)).
The total number of ordinary shares in issue as at 30 June 2018 were 1 310 992 791 (2017: 1 118
360 942) shares.
Major components of the Group’s operating expenses comprised the following main categories:
Total Business
Figures in pound sterling June 2018 Operations Development Head Office
Admin, corporate and operational costs 288 361 146 466 16 238 125 657
Consulting and professional fees 518 146 185 482 29 951 302 713
Human resources 817 817 619 190 3 455 195 172
Corporate listing costs 137 339 - - 137 339
Loss on exchange differences 120 437 92 893 43 27 500
Travelling 21 903 - 1 273 20 631
Repairs and Maintenance 12 273 10 841 819 613
Total operating expenses before non-
cash expenses listed below1 1 916 2761 1 054 872 51 780 809 625
Other non-cash operating expenses
Amortisation, depreciation 3 236 750 2 907 088 329 662 -
Share-based payment charge
– new options granted 263 800 - - 263 800
Total operating expenses reported 5 416 827 3 961 960 381 442 1 073 425
1=Total operating expenses before non-cash expenses down 30.82 % to £ 1.92 million (2017: £ 2.77 million)
Figures in pound sterling Total
June Business Head
2017 Operations Development Office
Admin, corporate and operational costs 1 043 065 341 742 580 601 120 718
Consulting and professional fees 847 717 601 559 75 107 171 050
Human resources 628 695 393 942 – 234 754
Corporate listing costs 150 104 – – 150 104
Loss on exchange differences 72 418 47 714 – 24 704
Travelling 16 633 159 – 16 474
Repairs and Maintenance 11 249 9 538 – 1 711
Total operating expenses before credit
amounts and non-cash expenses listed
below 2 769 881 1 394 654 655 708 719 515
Credit amounts
Recovery of proceeds receivable from
disposal of assets previously provided for
as bad debts (461 727) - - (461 727)
Sub total 2 308 154 1 394 654 655 708 257 787
Other non-cash operating expenses
Amortisation, depreciation and
impairments 1 108 866 1 108 866 – –
Share-based payment charge 22 025 – – 22 025
Total operating expenses reported 3 439 040 2 503 521 655 708 279 812
The table above forms part of supplementary information and has not been audited.
3. Dividends
The Board did not declare any dividends for the period under review. (2017: Nil)
4. Auditor’s review opinion
These results have been audited by the Group’s auditors, Saffery Champness LLP and their report is
available for inspection at the Company’s registered office. A copy of the report is also attached to
the back of this announcement as annexure 1.
5. Board
There were changes to the Board during the period under review. Mr Andrew Sarosi has resigned as
Director, effective 21 June 2018 and Dr Evan Kirby was appointed as Technical Director, effective 21
June 2018.
6. Share capital and share premium
Group
2018 2017
Authorised
The share capital of the Company is divided into an unlimited number of
ordinary shares of £0.01 each.
Issued share capital fully paid
Ordinary shares of 1 pence each (£) 13 109 923 11 183 609
Share premium (£) 80 955 150 76 491 331
Total issued capital (£) 94 065 073 87 674 940
The Company issued the following shares during the period and up to the date of this annual report:
Issue price –
Date issued Number of shares pence Purpose
Opening balance 1 118 360 942
15 January 2018 125 000 000 3.60 Placing
19 January 2018 63 166 969 4.01 Acquisition
20 April 2018 4 464 880 10.59 Acquisition
Closing balance at year-end 1 310 992 791
The Company did not issue any shares after year-end to the date of this report.
WARRANTS
At year-end and at the last practicable date the Company had the following warrants outstanding:
Share price
Issue at
Number price issue date
of warrants Issue date £s Expiry date Pence
3 591 742 2015-08-12 0.04750 2018-08-12 4.48
8 244 825 2016-03-23 0.04725 2019-03-23 2.94
27 777 780 2018-01-19 0.06120 2023-01-19 3.55
29 166 665 2018-01-19 0.06120 2023-01-19 3.55
5 555 555 2018-01-19 0.06120 2023-01-19 3.55
2 777 778 2018-01-19 0.06120 2023-01-19 3.55
77 114 345
7. Business segments
The operations of the Group companies comprise of four reporting segments being:
- the beneficiation of Platinum Group Metals (“PGMs”) and development of PGM smelters
utilising exclusive commercialisation rights of the ConRoast smelting process, located in South
Africa (“PGM beneficiation and development”);
- the evaluation of the reclamation and processing of sulphide nickel tailings in Australia and the
development and implementation of process solutions, specifically targeting both liquid and
solid waste streams from mine processes (Research and Development);
- the exploration and mining of Platinum Group Metals (“PGMs”) (Exploration and mining);
- the parent company operates a head office based in the United Kingdom, which incur certain
administration and corporate costs. (“Corporate”)
The Group’s operations span six countries, South Africa, Australia, Madagascar, Mauritius, Zambia
and the United Kingdom. There is no difference between the accounting policies applied in the
segment reporting and those applied in the Group financial statements. Mauritius and Madagascar do
not meet the qualitative threshold under IFRS 8, consequently no separate reporting is provided.
Segment report for the year ended 30 June 2018
PGM
beneficiation Total
and Research and Exploration Continuing
Figures in Pound Sterling development development and mining Corporate operations
Total revenues (14 139 510) - - - (14 139 510)
Cost of sales 8 672 325 - - - 8 672 325
Forex losses 92 893 - - 27 500 120 394
Share of loss from associate 308 451 - - - 308 451
Loss before taxation 952 910 348 840 30 946 1 070 671 2 403 369
Taxation - - - - -
Loss after taxation 952 910 348 840 30 946 1 070 628 2 403 369
Interest received (22 526) - (263) (2 797) (25 586)
Interest paid 1 375 732 - - - 1 375 732
Depreciation, amortisation and
impairments 2 898 310 338 440 - - 3 236 750
Total assets 25 555 593 14 016 052 25 325 043 4 540 056 69 436 744
Total liabilities (5 393 954) (3 305 224) (1 376 573) (558 264) (10 634 014)
Segment report for the year ended 30 June 2017
PGM
beneficiation Research Total
Figures in Pound and and Exploration Continuing Disposal
Sterling development development and mining Corporate operations Group
Total revenues (9 805 702) – – - (9 805 702) -
Cost of sales 8 038 731 – – - 8 038 731 -
Forex losses 47 714 – – 24 704 72 418 –
Loss before taxation 1 511 175 18 566 747 71 118 734 887 20 883 927 (461 728)
Taxation 250 303 (10 099 909) – – (9 849 605) –
Loss after taxation 1 761 478 8 466 838 71 118 734 887 11 034 322 (461 728)
Interest received (11 609) – (760) (6 304) (18 673) -
Interest paid 198 565 – – - 198 565 –
Depreciation,
amortisation and 1 108 866 18 554 683 15 901 – 19 679 451 –
impairments
Total assets 24 149 529 15 131 292 26 524 677 3 440 910 69 246 408 –
Total liabilities (7 138 099) (2 275 862) (2 414 659) (1 059 526) (12 888 146) –
8. Going concern
The Directors have adopted the going-concern basis in preparing the financial statements.
The period under review has seen Jubilee continuing to successfully develop and grow its strategy to
successfully implement its Metals Recovery Strategy which is advancing to the satisfaction of the
Board. Jubilee is currently evaluating a number of projects, which if concluded successfully, would
enhance shareholder value and growth for the Group.
Factors in support of the Group’s treasury position are listed below:
8.1 The Company has an USD10 million loan agreement secured. Jubilee has drawn down on
USD5m of the total facility since inception of the loan. At the period end the amount
outstanding, including fees and interest was £3.07 million (2017: £3.78 million).
8.2 On 9 August 2017 Jubilee secured a project funding facility which is modelled on the
successful Hernic platinum and chrome recovery project.
8.3 In January 2018 the Company successfully completed a placing of 125 000 000 new ordinary
shares of 1 pence each in Jubilee at a price of 3.6 pence (ZAR 62.62 cents) per share raising
approximately £4.5 million before expenses (ZAR 75.78 million) (Conversion rates applicable
on the date of the announcement being 9 January 2018).
8.4 The Group’s current projects are cash generative and contributes to the treasury of the Group.
The Directors are of the opinion that the Group and Company are funded sufficiently to enable it to
continue with its operations as a going concern.
9. Events after the reporting period
9.1 BMR Group Plc
On 7 February 2018, the company announced the suspension of trading of its securities on AIM. On
3 August BMR’s admission to AIM was cancelled and the company converted to an unlisted public
company. Jubilee’s 29.01% then converted to an unlisted public investment in associate.
9.2 Kabwe Project
As announced on 2 May 2018, Jubilee executed a shareholders and operating agreement with BMR
for the Kabwe Project. As announced on 6 August 2018, these agreements for the Kabwe Project were
updated (“Updated Agreements”) to better align with Jubilee’s role to deliver a successful project. The
Updated Agreements places Jubilee in full control of the execution methodology and funding
requirements to bring the Kabwe Project to account. In return Jubilee will hold a minimum of 87. 5%
shareholding in Kabwe Operations Limited, a company incorporated as a Joint Venture Company
(“Kabwe Operations”) assigned with all intellectual property developed for the execution of the
Kabwe Project as well as the right to fund and execute the Kabwe Project. This, together with Jubilee’s
indirect interest in Kabwe Operations through its 29.01% direct shareholding in BMR, results in
Jubilee holding a 91.1% interest in Kabwe Operations post year end.
Jubilee holds a further option, at its sole election, to acquire 100% of the issued shares of Enviro
Mining Limited (“EML”), a subsidiary of BMR and the company that owns the Project through
BMR’s Zambian based Enviro Processing Limited (“EPL”). BMR will then hold either the remaining
12. 5% shareholding in Kabwe Operations or should Jubilee acquire EML outright a 12. 5% share of
earnings generated by the Project (“Royalty”). Such Royalty payments will only be due and payable
by the Kabwe Project once Jubilee has secured a minimum of a 30% return on the investment made
into the Kabwe Project and only once EPL or Kabwe Operations have received all generated earnings
in cash.
14 November 2018
Jubilee Metals Group PLC
Colin Bird/Leon Coetzer
Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913
Nominated Adviser
SPARK Advisory Partners Limited
Mark Brady/Andrew Emmott
Tel: +44 (0) 203 368 3555
Broker
Shard Capital Partners LLP
Damon Heath/Erik Woolgar
Tel +44 (0) 20 7 186 9900
JSE Sponsor
Sasfin Capital (a member of the Sasfin group)
Sharon Owens
Tel +27 (0) 11 809 7500
Annexure 1
Jubilee Metals Group Plc
Independent auditors’ report to the members
Opinion
We have audited the financial statements of Jubilee Metals Group Plc for the year ended 30 June 2018
which comprise the Group and Company Statements of Financial Position, the Group and Company
Statements of Comprehensive Income, the Group and Company Statements of Changes in Equity, the
Group and Company Statements of Cash flows and notes to the financial statements, including a
summary of significant accounting policies set out on pages 42 to 85. The financial reporting
framework that has been applied in their preparation is applicable law and International Financial
Reporting Standards (IFRSs) as adopted by the European Union.
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 30
June 2018 and of the group and parent company’s loss for the period then ended;
• have been properly prepared in accordance with IFRSs as adopted by the European Union; and
• 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 the 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, 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.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK)
require us to report to you where:
• the directors’ use of the going concern basis of accounting in the preparation of the financial
statements is not appropriate; or
• the directors have not disclosed in the financial statements any identified material uncertainties
that may cast significant doubt about the group’s or the parent company’s ability to continue to
adopt the going concern basis of accounting for a period of at least twelve months from the date
when the financial statements are authorised for issue.
Key audit matters
Key audit matters are those matters that, in our professional judgement, 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 statement as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Key Audit Matter How our audit addressed the key audit
matter
Carrying value of intangible assets
The carrying value of intangible assets included Our audit procedures included the following:
in the Group’s balance sheet at 30 June 2018
was stated as £45.0m, contained within 3 cash • Assessing whether the methodology
generating units (“CGUs”). used by the Directors to calculate
recoverable amounts complies with IAS
36;
The Directors assess at each reporting period • Assessing the viability of the platinum
end whether there is any indication that an asset group elements (“PGE”) exploration
may be impaired and intangible assets with an asset by analysing CGU value in use
indefinite life must be tested for impairment on cash flows and determining whether
an annual basis. The determination of the input assumptions are reasonable
recoverable amount, being the higher of value- and supportable given the current
in-use and fair value less costs to dispose, macroeconomic climate;
requires judgement on the part of management
in both identifying and then valuing the relevant • Performing sensitivity analysis on key
CGUs, especially for projects where the there is assumptions and testing the
an uncertain timeframe. mathematical accuracy of models;
• Challenging inputs to models including
comparison with external data sources;
Deferred tax liabilities are recognised on certain
intangible assets following business • Reviewing correspondence and other
combinations and these liabilities are re- sources for evidence of impairment;
evaluated at each reporting period end.
• Reviewing the recoverability of
intercompany loans within the parent
company and indicators of impairment
Any impairment in these CGUs could lead to in investments in subsidiaries;
subsequent impairments in the parent company
investments in subsidiaries or intercompany • Assessing the appropriateness and
loans to these subsidiaries. completeness of the related disclosures
in note 9, intangible assets, of the group
financial statements; and
Due to the significance of the intangible assets
to the consolidated financial statements, the
significant judgements involved in these
calculations and the potential impact to parent • Recalculating the deferred tax liability
company investments and intercompany loans, relating to specific intangible assets and
the carrying value of intangible assets is a key assessing applicable tax rates.
audit matter.
Based on our procedures, we noted no material
exceptions and considered management’s key
assumptions to be within reasonable ranges.
Revenue recognition
Revenue for the year was £14.1m, representing Our audit procedures included the following:
a significant increase on 2017. 2018 was the
first full year of production at Hernic, giving • Evaluating the Group’s revenue
increased revenue for the group. Revenue recognition policy and management’s
recognised is from platinum group metals current year accounting assessment for
(“PGM”) concentrate and chromite concentrate the fair value of consideration
sales. receivable;
As required by IFRS as adopted by the • Confirming the implementation of the
European Union, an entity is required to Group’s policy to both PGM
recognise revenue at the fair value of the concentrate sales at Hernic and
consideration received or receivable when the chromite concentrate sales at DCM by
following conditions have been satisfied: performing tests to confirm our
understanding of the process by which
• the entity has transferred to the buyer revenue is calculated;
the significant risks and rewards of
ownership of the goods; • Confirming that fair value
measurements are determined in
• the entity retains neither continuing accordance with IFRS 13;
managerial involvement to the degree
usually associated with ownership nor • Comparing foreign exchange rates used
effective control over the goods sold; in management’s calculations;
• the amount of revenue can be measured • Substantive tests agreeing concentrates
reliably; and underlying calculations to
independent sources ; and
• it is probable that the economic benefits
associated with the transaction will • Assessing the appropriateness of the
flow to the entity; and related disclosures in notes 1.12 and 3,
revenue recognition accounting policy
• the costs incurred or to be incurred in and revenue split by commodity, of the
respect of the transaction can be group financial statements.
measured reliably.
For the sale of chromite concentrate and PGM
concentrate, revenue is initially recognised at Based on our procedures, we noted no material
the fair value of the consideration receivable, exceptions and considered management’s key
which is an estimate of the final sales price (see assumptions to be within reasonable ranges. We
note 1.12, revenue recognition accounting consider that revenue recognition has been
policy, for the full revenue recognition policy). recognised appropriately and is in accordance
with the Group’s revenue recognition policy.
Due to the significance of revenue to the
consolidated financial statements, the
judgement involved in estimating consideration
receivable and this being the first year of
revenue generated at the Hernic project,
revenue recognition is a key audit matter.
Accounting and disclosure of associates
During the year Jubilee acquired a 29.01% Our audit procedures included the following:
interest in BMR Group Plc (“BMR”) through
the issue of shares in Jubilee. The value of the • Evaluating the terms of the Share
shares issued was £3,032,995. Jubilee also Exchange Agreement between Jubilee
acquired 15% of Kabwe Operations (Pty) Ltd and BMR including Recalculating the
(“Kabwe”), a subsidiary of BMR through transaction value;
funding of £300,000. £242,000 of the £300,000
• Reviewing journal entries to ensure the
funding had been paid by the year end.
accounting for each transaction was
The Directors are required to assess at the correct;
reporting period end whether a subsidiary
• Challenging the basis of the Directors’
relationship is created by virtue of control over
impairment assessment of their
the entity or if the entity was an associate due to
investment in BMR undertaking
having significant influence only. Any such
procedures on a sample basis to
judgement by the Directors must be
understand the impact of the group’s
substantiated.
share of BMR’s loss;
The Directors are also required to assess at the
• Testing for impairment an intangible
reporting period end if the investment in BMR
asset held by BMR in respect of Kabwe;
is impaired. They must also identify and
account for any group share of profits and • Reviewing and challenging the
losses, along with including appropriate cashflow model produced for the above
disclosures in the annual report. intangible to ensure reasonable,
In line with BMR being determined to be an including review of the assumptions
associate, the interest is accounted for under the used such as discount rate and expected
equity method. On initial recognition the tonnage;
investment in an associate is recognised at cost, • Considering the expertise of external
and the carrying amount is increased or
experts upon whose resource statements
decreased to recognise the investor's share of
and reports we relied upon;
the profit or loss of the investee after the date of
acquisition. • Reviewing deferred tax adjustments
included in line with the impairments of
Due to the significance of the share of the
assets recorded at fair value in BMR;
associates profit or loss to the consolidated
financial statements and due to the relationship • Recalculating Jubilee’s share of BMR’s
being a material business combination consolidated loss and identifying the
requiring the judgement of the Directors, the date from which Jubilee held an interest
accounting and disclosure of associates is a key to understand how the adjustment had
audit matter. been made for the acquisition part way
through the year;
• Considering the accounting treatment
against IAS 28 Investment in
Associates and Joint Ventures; and
• Reviewing the disclosure requirements
to ensure adequate disclosure was given
in the financial statements.
Based on our procedures, we noted no material
exceptions and considered the accounting and
disclosure of associates to be within reasonable
ranges.
Accounting and disclosure of non-
controlling interests
Our audit procedures included the following:
During the year Jubilee disposed of 63 ordinary
par value shares in Braemore Precious Metal • Evaluating the terms of the sale of
Refiners (Pty) Limited (“BPMR”), a wholly shares and participation agreement
owned subsidiary of Jubilee Processing (Pty) including recalculating the % share of
Limited. The disposal reduced Jubilee’s interest Jubilee’s interest in the subsidiary
in BPMR by 26.25%. The shares were disposed of Reviewing the journal
purchased by Kgato Investments (Pty) Limited entries to ensure the accounting for
(“Kgato”), the beneficial owner of Kgato is Dr each transaction was correct;
Nakedi Mathews Phosa a Director of the Jubilee
• Reviewing and challenging the
Group.
Directors valuation model used to
Under IFRS 10 Consolidation of financial determine the fair value of the
statements, changes in a parent's ownership receivable due from Kgato, including
interest in a subsidiary that do not result in the review of the discount rate used and
parent losing control of the subsidiary are expected revenue forecasts;
equity transactions. When the proportion of the
• Recalculating Kgato’s share of
equity held by non-controlling interests
Jubilee’s consolidated loss and ensuring
changes, the carrying amount of the controlling
this had been accounted for correctly in
and non-controlling interests are adjusted to
the financial statements;
reflect the changes in their relative interests in
the subsidiary. Any difference between the • Considering the accounting treatment
amount by which the non-controlling interests against IFRS 10 Consolidated financial
are adjusted and the fair value of the statements; and
consideration paid or received is recognised
directly in equity and attributed to the owners • Reviewing the disclosure requirements
of the parent to ensure adequate disclosure was given
in the annual report. Including specific
Per the terms of the agreement the purchase review of the disclosures required for
price of the shares is to be determined by the the related party transaction.
auditors of the subsidiary BPMR. As a
valuation had not taken place by the reporting Based on our procedures, we noted no material
period end the Directors are required to assess exceptions and considered the accounting and
the fair value of the shares purchased. They disclosure of both the disposal of shares and
must also identify and account for any share of non-controlling interest to be within reasonable
profits and losses attributable to the non- ranges.
controlling interest, along with including
appropriate disclosures in the annual report.
Due to the significance of the transaction being
with a related party and requiring the judgement
of the Directors in valuing the consideration due
for shares purchased, the accounting and
disclosure of non-controlling interests is a key
audit matter.
Our application of materiality
We apply the concept of materiality in planning and performing our audit, in evaluating the effect of
any identified misstatements and in forming our audit opinion. Our overall objective as auditor is to
obtain reasonable assurance that the financial statements as a whole are free from material
misstatement, whether due to fraud or error. We consider a misstatement to be material where it could
reasonably be expected to influence the economic decisions of the users of the financial statements.
We have determined a materiality of £600,000 (2017: £620,000) for both the Group and Company
financial statements. This is based on 1% of net assets per draft financials at the planning stage.
An overview of the scope of our audit
We tailored the scope of our audit to ensure that we obtained sufficient evidence to support our opinion
on the financial statements as a whole, taking into account the structure of the Group and the Parent
Company, the accounting processes and controls and the industry in which the Group operates.
As Group auditors we carried out the audit of the Company financial statements and, in accordance
with ISA (UK) 600, obtained sufficient evidence regarding the audit of six subsidiaries undertaken by
component auditors in South Africa. These six subsidiaries were deemed to be significant to the Group
financial statements either due to their size or their risk characteristics. The Group audit team directed,
supervised and reviewed the work of the component auditors in South Africa, which involved issuing
detailed instructions, holding regular discussions with component audit teams, performing detailed
file reviews and visiting South Africa to attend local audit meetings with management. Audit work in
South Africa was performed at materiality levels of £100,000, lower than Group materiality.
As part of designing our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements. In particular, we looked at where the Directors made
subjective judgements, for example in respect of significant accounting estimates that involved making
assumptions and considering 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.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report, other than the financial statements and our auditor’s report
thereon. Our opinion on the 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether there is a material misstatement in the financial statements or a material
misstatement of the other information. 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 company and its 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, 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 set out on page 32, the directors
are responsible for the preparation of the 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 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 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.
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.
Jamie Cassell (Senior Statutory Auditor)
for and on behalf of Saffery Champness LLP
Chartered Accountants
Statutory Auditors
71 Queen Victoria Street
London
EC4V 4BE
14 November 2018
Annexure 2 - Headline earnings per share
Accounting policy
Headline earnings per share (HEPS) is calculated using the weighted average number of shares in
issue during the period under review and is based on earnings attributable to ordinary shareholders,
after excluding those items as required by Circular 4/2018 issued by the South African Institute of
Chartered Accountants (SAICA).
In compliance with paragraph 18.19 (c) of the JSE Listings Requirements the table below represents
the Group’s Headline earnings and a reconciliation of the Group’s loss reported and headline earnings
used in the calculation of headline earnings per share:
30 June 2018 30 June 2017
£’000 £’000
Short form reconciliation of headline earnings
Headline loss per share comprises the following:
Loss from operations for the period attributable to ordinary (2 115) (10 570)
Share of impairment loss of equity accounted associate
shareholders 93 -
Impairment of other financial assets 622 18 371
Total tax effects of adjustments (200) (9 849)
Loss on exchange differences - 72
Headline loss from continuing operations (1 600) (1 976)
Weighted average number of shares in issue 1 203 479 984 780
Headline loss per share (pence) (0.13) (1.07)
Headline loss per share (ZAR cents) (2.31) (18.55)
Average conversion rate used for the period under review £:ZAR 0.05759 0.05786
United Kingdom
14 November 2018
Sponsor: Sasfin Capital (a member of the Sasfin group)
Date: 14/11/2018 04:49:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
