Contents
Strategic Report
Principal Activities
Strategy & Business Model
Project Investment Strategy
Industry Leading Performance Metrics
Chairman’s Statement
Operations Review
Financial Review
Organisation Review
Directors
Operational Team
Key Performance Indicators
Risks & Uncertainties
Section 172(1) Statement
Governance
Corporate Governance
Corporate Responsibility
Report of the Directors
Independent Auditor’s Report
Financial Statements
Annual General Meeting COVID-19 Statement
Notice of the 2020 Annual General Meeting of Ariana Resources PLC
Advisors
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ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020 LONDON
ANKARA OPERATING HUB
Principal Activities
The principal activities of the Company and its
subsidiaries are the exploration and development
of precious and technology metals. The primary
area of geological focus is the globally significant
Tethyan Metallogenic Belt, which spans over
10,000km from central Europe through to the
Himalayas and beyond. This metallogenic belt
hosts some of the world’s largest gold, silver and
copper deposits.
The Company aims to advance mineral resource
opportunities both within its primary area of
operations in Turkey and across the wider
European and Eastern Mediterranean regions,
within which the Company has specific expertise.
Beyond its primary interest in precious metals,
specific opportunities are being evaluated
in the context of the demand for mineral
resources which contribute toward technological
development, energy efficiency and the global
decarbonisation agenda.
Dymaxion projection of the eastern hemisphere scales
countries more realistically than other map projections.
TETHYAN METALLOGENIC BELT
GOLD EXPLORATION HOT-SPOTS
CYPRUS: VENUS MINERALS PROJECTS
KOSOVO: WESTERN TETHYAN RESOURCES PROJECTS
TURKEY: ZENIT MADENCILIK PROJECTS
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PERTH
STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020 Strategy & Business Model
The Company’s primary strategy is to achieve sustainable long-term growth of the Company via robust
and cost-efficient mineral exploration and development.
This approach has led Ariana to identify, advance and develop projects rapidly, with a discovery cost per
ounce of gold that is substantially less than its peers.
The Company plans to achieve its goals by:
• Focusing on the discovery of sizeable mineral systems
• Building positive long-term relationships with local government, communities and key stakeholders
• Developing a strong team with excellent commercial, technical and financial skills
• Forming robust business partnerships for the development of gold and other mineral projects
• Executing selective, value-creative exploration programmes and joint venture (‘JV’) opportunities
• Ensuring safe operating procedures and minimising environmental impact
Project Investment Strategy
Operational Cash-flow
Zenit Madencilik JV, Turkey (23.5%)
C
O
2 P
E
R O
U
N
C
E L
E
V
E
L
Ariana Resources
0.32 CO2 t/oz
VS
International average
0.8 CO2 t/oz
Regional Exploration Partnerships
Venus Minerals, Cyprus (37.5%)
Western Tethyan Resources,
Eastern Europe (75%)
E
LU
A
G V
SIN
A
E
R
C
IN
Project Catalytic Investments
Discovery Funding
SUCCESSFUL PAST
INVESTMENTS
D
E
C
R
E
A
S
I
N
G
R
I
S
K
Project Generation Division
Utilising in-house specialists in remote-sensing,
geophysics and geochemistry
NUMBER OF OPPORTUNITIES
Previously Tigris
Resources Ltd
Previously Dakota Minerals
Ltd, since acquired by
Perseus Mining Ltd
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5
G
O
L
D DIS
C
O
V
E
R
Y C
O
S
T P
E
R O
Z
Ariana Resources
US$12/oz Au
(or US$8/oz Au eq)
VS
Industry average
US$62/oz Au
Industry Leading
Performance Metrics
Ariana has strived to implement
metrics to measure our achievements
against our strategic goals.
O
P
E
R
A
TIO
N
A
L C
A
S
H C
O
S
T
S
Ariana Resources
US$490/oz
(average LOM to date)
VS
International average
US$1,000/oz
Through the use of innovative technologies
and operating practices we have achieved
the following industry leading metrics:
• Gold Discovery Cost
• Operational Cash Costs
• Carbon Footprint
STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT
Chairman’s Statement
Fellow shareholders,
I am pleased to report that Ariana has again had
an outstanding year with gold production at 18,645
ounces, at an average life of mine cash cost
less than US$500 per ounce, alongside a most
successful ongoing exploration programme. This
set the stage for a transformational transaction
concluded after the year end, whereby Ariana
sold a significant portion of its Turkish assets for
a cash consideration, whilst still maintaining a
sizeable share of the cash-generating operations,
enabling Ariana to continue to implement its
successful exploration and development strategy.
During the period, the Kiziltepe Mine continued to
perform well above feasibility rates. This has been the
case since the commencement of operations and is
testament to the determination and professionalism
of the operating team. Despite the challenges of the
COVID-19 pandemic, they have managed to advance
production, exploration drilling and plant expansion
work simultaneously. The plant expansion, which
is expected to be commissioned during the second
half of 2021, allows for a doubling of the current
level of mill throughput. This will enable a lower
unit cost, as lower grade ore is brought on stream.
Excellent exploration and development work has
identified extensive additional mineral resources in
the immediate vicinity of the plant, which have the
potential to extend the life of mine significantly.
The mine continued to produce gold in the lowest cost
quartile internationally. This has enabled both the
repayment of the original construction loan and an
ongoing profit distribution to the Joint Venture (“JV”)
shareholders. This quality of operation enabled the
original JV partners to attract a highly regarded third
JV partner, namely Özaltin Holding A.S., which bought
a 53% stake in Zenit Madencilik San. ve Tic. A.S., now
incorporating the Salinbaş Gold Project, in addition to
the Kiziltepe Mine and the Tavşan Gold Project. We
now have a three-way partnership working on our
Turkish portfolio of assets and we are looking forward
to the accelerated development of these projects.
Over the last year, the delays and obstacles arising
from the ongoing pandemic naturally led to the
direction of available manpower predominantly
to the Kiziltepe Mine. Fewer resources were
physically deployed on the other Company assets,
though project work continued across the portfolio,
leading significantly to several important resource
updates. Currently the Tavşan Project is awaiting
its Environmental Impact Assessment approvals
and various provisional permitting applications
are in process. At the present rate of progress,
we are expecting production at Tavşan to be
achieved from late 2022. Meanwhile, further work is
ongoing at the Salinbaş Project, with a new drilling
programme scheduled to commence later in 2021.
While presenting some challenges, this new operating
environment has also introduced a number of new
opportunities, which, along with the successful
completion of the Özaltin JV transaction, will
allow Ariana to pursue more ambitious exploration
programmes. This is being pursued predominantly
through the use of freely available information and
databases integrated with data held by Ariana. This
is a highly technical process of data interpretation
and target definition, which our exploration team
is particularly skilled in. We use this information
to develop partnerships with carefully chosen
collaborators who then go on to develop assets. This
approach has yielded success many times in the past.
this new operating environment
has also introduced a number of
new opportunities, which along
with the successful completion
of the Özaltin JV transaction,
will allow Ariana to pursue more
ambitious exploration programmes
The Ariana team has never been afraid of drilling up
a “duster” and yet in my 16 years of recollection there
have not been many, if any at all. When undertaking
new exploration, one must allow for the occasional
“miss” when aiming at a new target. It takes a lot
of courage and determination to launch into a new
territory and most definitely needs the support of
a close team to undertake such new ventures. It
seems appropriate to take inspiration from one of
the most prolific goal scorers, Wayne Gretzky, whose
mantra was “you missed 100% of the shots you don’t
take”. With that in mind, I am encouraging our very
talented and dedicated exploration teams to carry
on with their excellent work, with the assurance that
there is 100% support, and the understanding that
we are all in this for the long game, for that next
mega discovery which is just over the next hill.
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Geotechnical and geochemical data gathered in
real time from a field deployable, Geotek BoxScan
system. This is a groundbreaking technological
step for exploration within the Company.
STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Chairman’s Statement continued
What Ariana is particularly good at is seeing the
big picture: where to look next and with whom to
collaborate to achieve the best outcome. To this
end, we have taken a global view of the Tethyan
Metallogenic Belt (“TMB”), our area of expertise,
then delved into our extensive database of
potential targets and pulled in our best partners for
collaboration in these areas to form a number of
new exploration opportunities. This is now taking
the form of Western Tethyan Resources Ltd, a
company which is focused on the Eastern European
end of the TMB, while we continue to support the
successful work of Venus Minerals Ltd on the island
of Cyprus. Meanwhile, further exploration and
development will continue in Turkey via our well-
established operations hub in Ankara, where Ariana
is establishing a dedicated office and technical
centre. This is allowing a full multidisciplinary team
to work on both data and material samples under
one roof. This is both an effective and efficient
operation in a very well-resourced location. Via
these regional partnerships, Ariana has reach over
2,500km of some of the most prospective territory
for gold, silver and copper deposits in the world.
We have taken a global view of
the Tethyan Metallogenic Belt
(“TMB”), our area of expertise...
Ariana has reach over 2,500km
of some of the most prospective
territory for gold, silver and
copper deposits in the world.
Kiziltepe processing plant.
Any company’s annual review would be incomplete
without some discussion and comment on “the
herd of elephants in the room” in our sector. To
mention just a few of these: the magnitude of the
pandemic has probably taken most of us by surprise
and left many of us considering what are the most
important things to us in our working and private
lives. To that end, it is probably worth thinking of
what one’s core values are and what we deliver in
our day-to-day work. I can honestly say that the
Ariana team are focused on delivering the most
professional job possible despite the challenges of
the moment. The dedication and focus of our team
is admirable and the Company is especially grateful.
The other elephant in the room, and an important
subject undergoing continual internal review, is
Environmental, Social and Governance (“ESG”). I see
this subject as being largely about one’s core values
and how we interact with our stakeholders and the
environment. In the broader sense, stakeholders
are as wide ranging as the environment in which
we operate, the communities located around our
exploration prospects, the Kiziltepe mine community
and the ultimate beneficiaries of our commercial
endeavours, our staff and shareholders, in addition
to local and national economies. In all areas this
range of stakeholders must be treated with fairness
and respect, as well as being kept informed about
aspects of the Company’s affairs that materially affect
them. This relationship is inevitably a two-way street
of communication with both sides practising active
listening and respect for one another’s point of view. It
is through this process that I think we learn the most.
Of course, the one stakeholder which does not have
a voice of its own needs special mention here. I
think the environment and climate change should be
discussed as a broader and integrated topic. While
the extractive industries continue to get the blunt
edge of media attention, it is plainly obvious that
human civilisation cannot exist without incurring an
impact on the Earth. All primary industries, whether
it is fishing, farming, forestry or mining, leave a
physical and lasting impact, altering the environment
through their presence. One only has to view Google
Earth to see the massive physical evidence of sea
pollution, farming, forestry and the odd mining or
tailings dam site. However, of all industries in my
opinion, mining delivers significantly more permanent
benefit relative to its physical impact on the Earth. We
cannot change the fact that our industry has already
had a significant impact and made many mistakes.
Nevertheless, we can positively affect the future and
our overall environmental impact going forwards.
Ariana aims to continue
to explore for our natural
assets in a constructive and
sustainable manner, very
conscious of our legacy
With this in mind, Ariana aims to continue to explore
for our natural assets in a constructive and sustainable
manner, very conscious of our legacy. Mining for
resources predates farming and probably followed
mankind’s first hunting and fishing activities. As we
now try to live in closer harmony with our natural world
and take steps towards living in the least polluting way,
we will also need to continue to explore for the minerals
that will allow for greater electrification and pollution-
scrubbing of fossil fuels. Ariana will continue along
this theme, to look for sizeable deposits in the copper,
gold and silver space along with other elements, set
against the backdrop of the requirement for a cleaner
environment. The mining industry has been the
leader in dealing with the ESG agenda for decades,
ahead of many other industries. It has been at the
top of the agenda on all the mining projects I have
ever been involved with during my working life. This
will continue to be the case. A lot more thought and
resources should be invested in mineral exploration
to deliver our ongoing needs for new minerals and
the clean and effective use of remaining resources.
We cannot leave the discussion of “elephants in the
room” without considering the largest destination for
much of what is mined, that being Asia, in particular
China. China is by far the largest consumer of coal
and iron and is consequentially the largest producer
of industrial pollution by some margin. China has
made very clear steps towards disinvesting out of
polluting industries and increasing investment in
cleaner energy alternatives. It is a very well publicised
fact that there are simply not enough of the required
battery and electrification metals available to
meet the forecast demand for a significant switch
to broader electrification. This trend, along with
worldwide government stimulus and post-pandemic
investment, further supports the view that whilst we
have been in a commodities super-cycle for some
time, this is likely to continue with the help of Chinese
demand, placing Ariana in the right place at the
right time to continue to enjoy this growing trend.
With Ariana now looking at a wider field of potential
exploration, it is appropriate that we have a wider
spread of our team and partners across our
theatres of operation. This currently ranges across
Australia, Cyprus, Kosovo, Turkey and the UK. Our
team is consequently able to cover nine time
zones and a multitude of prospective geological
regions simultaneously. This strategy allows for
“boots on the ground” and “the eyeball mark one”
to be deployed without any need for international
air travel, which in itself satisfies a significant
part of our ESG commitment going forward.
Last but not least, we intend to reward our
shareholders who have remained invested over the
long haul through the payment of dividends. Court
approval of our capital reorganisation has been
received and this will enable the declaration of a
dividend which the Board will announce in due course.
As current guidance on Annual General Meeting
(“AGM”) regimes is returning to face-to-face meetings,
with social distancing, it may again be possible to
meet you in person to present our results and provide
a Company update. We would however still encourage
you to exercise your proxy votes well in advance of
the AGM date as you did last year. I would like to close
by thanking our corporate advisors and growing clan
of strategic partners for their dedication and support
in helping Ariana achieve its ongoing success.
Michael de Villiers
Chairman
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Operations Review
During 2020, the Company continued to deliver
positively against all facets of its strategy, despite
the obvious challenges presented by the ongoing
pandemic. Near the end of the year, the Company
sought shareholder approval to conclude its proposed
new joint venture agreement with Özaltin Holding A.S.
and Proccea Construction Co. The transaction was
finalised in February 2021, and the interests of the
Company in Turkey are now held through its 23.5%
shareholding in Zenit Madencilik San. ve Tic. A.S.
(“Zenit” or the “JV”). Accordingly, by early 2021, the
Company had completed the partial divestment of
its interests in Turkey in exchange for US$30 million
in cash before costs and taxation from our new
partner, Özaltin Holding A.S.; a further US$5.75 million
was paid by Proccea Construction Co. and another
US$2 million due from Zenit following the transfer
of certain satellite projects. In addition, a further
US$8 million of capital was injected into the JV by
Özaltin Holding A.S. in order to advance Salinbaş.
For the fourth year running, the joint venture in Turkey
exceeded its gold production guidance for the year at
its Kiziltepe Mine and during the year fully repaid its
US$33 million capital development loan from Turkiye
Finans Katilim Bankasi A.S. In addition, the Company
increased its joint venture resource base substantially
to c.2.1Moz of gold, following a series of JORC Resource
Estimate and Exploration Target updates. In parallel
with increases in resources and enhanced mining rates
at Kiziltepe, the joint venture is completing a processing
plant expansion during 2021 to take the mill throughput
up to a maximum of 500,000 tonnes per annum from
approximately 200,000 tonnes per annum currently.
the Company increased its
joint venture resource base
substantially to c. 2.1Moz of gold
Top down view of processing plant expansion
at Kiziltepe. Due to be operational by H2 2021.
ZENIT JV
23.5% Ariana
VENUS - Ariana
earning to 50%
ARDALA
30M m³
SALINBAS
3.20M m³
TAVSAN
2.20M m³
KIZILTEPE
2.15M m³
MAGELLAN
3.50M m³
GOLD
OUNCES
939,000
598,000
253,000
227,000
48,500 - 257,000*
COPPER
TONNES
110,000
PRODUCTION
REVENUE
-
0
-
0
-
0
61,400
US$134m
-
NOTE: Areal footprint of each deposit area shown in plan view and at the same scale. The volume in cubic metres of each deposit area
is also provided. The contained gold in ounces and copper in tonnes (derived from JORC statements) is shown as circles with area
proportionate to the metal content. The Magellan Project gold content is based on the JORC Exploration Target. Current as at end 2020.
The Company also advanced its interests in a portfolio
of Cypriot copper-gold projects via its investment
in Venus Minerals Limited (“Venus”). During the
year, the first JORC resource for its Magellan Project
was established, standing at 9.5Mt at 0.65% copper
(Inferred). A resource and exploration drilling
programme, which commenced in March 2021, remains
underway at the Magellan Project. While our current
entitlement to shares in Venus has now reached 37.5%,
the Company is continuing its earn-in and expects to
reach 50% ownership of Venus by the end of 2021.
Elsewhere, the Company initiated work on its interests
in Eastern Europe through its investee company,
Western Tethyan Resources Limited (“WTR”) which
at the year-end was a wholly-owned subsidiary,
but which is now held 75% by Ariana. This Eastern
European focused company is managed by a high-
profile board with extensive operational experience
across this region. Licence applications located in
eastern Kosovo form the basis of the company’s
project interests at this time, though other projects
are being evaluated across the region. WTR is also
pursuing a target generation exercise utilising a range
of geoscientific datasets.
The Company was also proud to launch a not-for-
profit initiative, which aims to support education and
sustainability projects benefitting the communities in
which the Company operates. The Company and its
Joint Venture in Turkey has a successful track-record
of supporting local community and environmental
causes and it intends to build upon these in the years
ahead. Separately the Company is continuing to
support a twenty-year Masters degree scholarship
in Mining Geology, the Richard Osman Scholarship
Programme, at the Camborne School of Mines.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Operations Review continued
Zenit Madencilik
Zenit Madencilik San. ve Tic. A.S. is a joint
venture company operating in Turkey, now
owned 23.5% by Ariana. The joint venture
is operated by Proccea Construction Co.,
which also owns 23.5%, with the remaining
53% owned by Özaltin Holding A.S. Zenit
owns 100% of the Kiziltepe gold-silver mine,
and the Tavşan and Salinbaş development
projects, in addition to a number of other
gold projects in Turkey. The joint venture
owns a depleted total of c. 2.1 million
ounces of gold and other metals (as at
July 2020). The joint venture is focused on
achieving production from both Kiziltepe
and Tavşan in the coming years, with the
aim of increasing output to c. 50,000
ounces of gold per annum.
Arzu South open pit, with the Kiziltepe Mine
administrative buildings shown to the left.
Zenit JV Production Profile
NEW JV COMMENCES
ARIANA AT 23.5%
MILL EXPANSION
COMPLETED
z
o
d
o
G
l
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
2017
2018
2019
2020 2021
2022
2023 2024 2025 2026
2027
2028 2029 2030
TOTAL
Kiziltepe
Tavsan
Salinbas
Ariana Proportionate Share
Kiziltepe
The Kiziltepe Gold-Silver Mine is located in western Turkey
and contains a JORC (2012) Measured, Indicated and Inferred
Resource of 227,000 ounces gold and 0.7 million ounces silver
(as at April 2020). The mine has been in profitable production
since early 2017 and is expected to produce at a rate of
c.20,000 ounces of gold per annum to at least the mid-2020s.
Since start-up, the mine has recorded four years of successful
operations and has produced a total of 84,200 ounces of
gold and 915,200 ounces of silver, recording US$134 million in
revenue as at the end of 2020. Processing at Kiziltepe is via
the carbon-in-leach method and a processing plant expansion
is underway to provide for higher mill throughput. These
processing plant enhancements are due to be completed in
H2 2021, following which the processing plant capacity will be
increased by over 300% over the feasibility design and up to
500,000 tonnes of ore per annum. A major drilling programme
of over 10,000m was completed in H2 2021 which targeted
various resource extensions across the property. A Net
Smelter Return (“NSR”) royalty of 2.5% on production is being
paid to Franco-Nevada Corporation.
Joint Venture Revenue 2017-2021
Exploration and resource drilling team at Kiziltepe.
Cumulative
Revenue
2017-2020
$134M
Total ore mined
2017-2020
1,024,359t
Avg. processed
grade Au
2017-2020
3.52 g/t
$45.1M
$42.7M
$37.8M
$37.5M
l
z
o
d
o
G
/
r
e
v
l
i
S
500,000
400,000
300,000
200,000
$14M
100,000
0
2017
2018
2019
2020
2021 1
Revenue US$
Proportion of Ag oz
Proportion of Au oz
Historical and projected production from the Zenit JV, showing the production from individual mines and their annual total until 2030. Subject to
feasibility and environmental permitting, production from Tavşan is expected to conclude in 2030 while production from Salinbaş is expected to
extend beyond 2030.
NOTE: Total ore mined includes materials stockpiled and not yet processed as at end 2020.
1. Projected revenue calculated using an average of US$1,777 per oz Au and an average of US$25.5 per oz Ag as at 20 May 2021
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT
Operations Review continued
Tavşan
The Tavşan Gold Project is located
in western Turkey and contains a
JORC (2012) Measured, Indicated and
Inferred Resource of 253,000 ounces
gold and 3.7 million ounces silver
(as at June 2020). The project is
being progressed through permitting
and an Environmental Impact
Assessment, with the intention of
developing the site to become the
second joint venture gold mining
operation. Processing at Tavşan will
be via the heap-leach method to
accommodate a production rate of
c. 30,000 ounces of gold per annum.
It is expected that the mine life will
exceed six years and a new resource
drilling programme is expected to
be completed during 2021, targeting
further resource confirmation and
growth. A NSR royalty of up to 2%
on future production is payable to
Sandstorm Gold.
Trial mining stockpile at Tavşan.
Drill core from the most recent drill programme at Tavşan.
Full view of the Ardala porphry showing
the contact between the Salinbas
Au-Ag and Ardala Cu-Au-Mo zones.
Salinbaş
The Salinbaş Gold Project is located in north-
eastern Turkey and contains a JORC (2012)
Measured, Indicated and Inferred Resource
of 1.5 million ounces of gold (as at July 2020).
It is located within the multi-million ounce
Artvin Goldfield, which contains the “Hot
Gold Corridor” comprising several significant
gold-copper projects including the 4 million
ounce Hot Maden project, which lies 16km to
the south of Salinbaş. An Exploration Target
of up to 2.7Moz gold and 16.1Moz silver was
established for the project in 2018. There is
potential for further resource extensions to
be delineated within high-grade and steeply
dipping breccia pipes (akin to the Hot Maden
deposit), which likely merge with the Salinbaş
gold-silver zone. Furthermore, recent
work has confirmed that the Ardala Zone is
dominated by a significantly gold-enriched
copper-molybdenum porphyry system. A
NSR royalty of up to 2% on future production
is payable to Eldorado Gold Corporation.
Looking toward Tavşan South where
the JORC Exploration Target is located.
Berkin Uğurlu, Exploration
Manager evaluating drill
core using a handheld XRF.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Operations Review continued
Venus Minerals Ltd (“Venus”) is a UK registered,
Cyprus-domiciled company holding a significant
exploration and development portfolio in Cyprus.
Ariana is earning-in to 50% of Venus and has to date
earned into an entitlement to 37.5%. An advanced
copper-gold-zinc project, Magellan, contains an Inferred
JORC Resource of 9.5Mt @ 0.65% copper, which has
potential for less well constrained zinc at 0.6% and
unquantified gold and silver, providing the Company
with an exceptional foundation on which to build its
resource base. Scoping and pit-optimisation studies for
the projects have been completed and are under review
towards the preparation of a combined Preliminary
Economic Assessment. The Company recognises the
potential to confirm and grow these resources through
further drilling and a new drilling programme has been
underway on the Magellan Project since Q1 2021. Venus
also holds a substantial exploration portfolio outside of
the main project areas. This contains several immediate
drill targets, which have been established following a
rigorous data review and new surface exploration. It
is the intention of Venus to develop a significant new
mining operation in Cyprus.
www.venusminerals.co
Western Tethyan Resources Ltd is a UK registered,
Kosovo-domiciled company holding exploration
licence applications in Kosovo through its wholly-
owned subsidiary Kosovo Mineral Resources LLC
(“KMR”). The Company is currently 75% owned by
Ariana with the remaining 25% owned by a highly
qualified board. The Company is currently focused
on exploration for major copper-gold deposits in
the Lecce Magmatic Complex and Vardar Belt. The
Company is assessing several other exploration
project opportunities across Eastern Europe,
targeting major copper-gold deposits across the
porphyry-epithermal transition. Countries in which
project opportunities are being assessed include
Bosnia and Herzegovina, Bulgaria, Kosovo, North
Macedonia and Serbia. It is the intention of the
Company to progress to drill testing its projects
within the shortest possible timeframe.
www.westerntethyanresources.com
Asgard Metals Pty. Ltd. is a wholly-owned
Australian subsidiary of Ariana, now operating as
the Asgard Metals Fund (“Asgard”). The Company
was established initially to focus on technology-
commodity opportunities globally, and was successful
in identifying several early-stage lithium exploration
projects in Western Australia and the Northern Territory.
These projects were vended to two ASX-listed
companies in 2015 and 2016 for a combination of cash
and shares, which established the financial basis of
its future business. With A$2 million now available in
cash, the remit of the Company is being broadened to
encompass other project investment opportunities. It
is expected that Asgard will make “Project Catalytic”
investments in selected listed companies with
interests in high-quality early-stage exploration project
opportunities, with a particular focus on LSE and ASX
listed companies. Asgard is specifically focused on the
discovery stage of mineral exploration projects, where
the full capabilities of the Ariana in-house exploration
team can be brought to bear.
Grab samples showing the minerals
azurite and chrysocolla from dumps
at the Magellan Project, Cyprus.
Utilising handheld XRF to minimise over sampling. More representative samples can be selected based on optimal portable XRF geochemistry.
1 6
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Cecelia Project in Kosovo,
Western Tetyhan Resources.
STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Operations Review continued
Growth in Market Captalisation and Resource Base
8M*
2020
2017
£55M
TOTAL RESOURCE
2.88 Moz Au Eq.
49.6M
£15.3M*
TOTAL RESOURCE
1.62 Moz Au Eq.
25M 8M
8.4M
2013
£7.5M
TOTAL RESOURCE
1.03 Moz Au Eq.
2009
2007
£5.6M
TOTAL RESOURCE
0.40 Moz Au Eq.
£3.7M
TOTAL RESOURCE
0.14 Moz Au Eq.
2005
IPO
Funding
Market Funds (US$M)
Proccea JV Input (US$M)
Eldorado JV Input (US$M)
Kiziltepe Bank Finance (US$M)
Özaltin Holding (US$M)
* Özaltin Holding contribution to Salinbaş
Project expenditure continuing.
Ariana has minimised
shareholder risk by seeking
the majority of its funding
requirements through
partners and bank finance
TOTAL FUNDING
US$25
million
US$24.4
million
US$49.6
million
Shareholders
Partner Funding
Bank Finance
Outlook
With some of the difficulties of 2020 behind us, we
are now looking strategically and operationally to the
horizon of the next decade. Since our IPO in 2005,
we have transformed the Company from a junior gold
explorer to one which is sustainably self-financing,
holding a diverse portfolio of mineral exploration,
development and mining project investments. Most
importantly of all from an investor perspective, the
Company can demonstrate a robust track-record
across several metrics which, among others includes
our industry-leading discovery cost per ounce of gold
and our operational cash-costs which are in the lower
quartile internationally. From an environmental stand-
point, our joint venture operations produce gold at a
CO2 per ounce level which significantly lower than the
international average.
Having diligently built these solid foundations for
our future business during the best part of the past
two decades, we very much look forward to the new
“Roaring 20s”. As it was 100 years ago, with the
world having emerged from a catastrophic pandemic,
so will it be today. While the 1920s were marked by
the development of technologies which enabled
commercial flight, liquid-fuelled rockets, energy
distribution and television, the 2020s will be marked
by the development of commercial space-flight,
renewable energy, artificial intelligence and virtual
reality, amongst other technological advances. With
the global population having increased by 430%
Field exploration in western Turkey.
our reinvigorated purpose is to
discover the mineral resources
needed by mankind faster, better
and cheaper than our competitors
over the past century, the increased requirements
of these and other industries on the mining sector
are unprecedented. Your Company finds itself at the
dawn of this new age with the capability and financial
resources to meet these demands head on.
Stated simply, our reinvigorated purpose is to discover
the mineral resources needed by mankind faster, better
and cheaper than our competitors. We will continue
to achieve this by mitigating risks, mobilising cutting-
edge technologies, minimising environmental impact
and maximising partnerships with local communities.
In addition, very unusually for a mineral exploration and
development company, we are advancing a strategy
to enable the Company to pay dividends over the
long-term. This is in recognition of the important role
played by our shareholders, who provided the risk-
capital we required during our formative period and in
the expectation of facilitating a virtuous circle of future
investment in our Company.
Dr Kerim Sener
Managing Director
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT
Zenit JV Resource Tables
Resource Estimate for Kiziltepe/Tavşan:
Resource Estimate for Salinbaş / Ardala:
Kiziltepe and Kepez
Main Vein Zones
Measured
Indicated
Measured & Indicated
Inferred
Global Total
Tonnes
(t)
Grade Au
(g/t)
Grade Ag
(g/t)
Gold
(oz)
Silver
(oz)
970,000
1,044,000
2,014,000
1,011,000
3,025,000
2.46
2.54
2.51
2.23
2.33
43.64
43.35
43.49
29.58
77,000
77,000
1,361,000
1,377,000
154,000
2,738,000
Measured & Indicated
73,000
961,000
Inferred
38.03
227,000
3,699,000
Global Total
Zone
Salinbaş
Measured
Indicated
Tonnes
(t)
Grade Au
(g/t)
Grade Ag
(g/t)
Gold
(oz)
Silver
(oz)
868,000
2,421,000
3,289,000
5,114,000
8,403,000
2.32
1.83
1.96
2.38
2.21
15.30
19.00
18.02
16.10
16.90
65,000
428,000
142,000
1,478,000
207,000
1,906,000
391,000
2,649,000
598,000
4,555,000
Summary 2020 Kiziltepe and Kepez JORC 2012 compliant Mineral Resource Estimate (depleted for mining). Reporting is based on a 1.0 g/t Au
cut-off grade. Resource estimate dated 22 April 2020. Figures in the table may not sum precisely due to rounding.
Tavşan
Measured
Indicated
Measured & Indicated
Inferred
Global Total
Tonnes
(t)
611,000
2,556,000
3,167,000
1,322,000
4,489,000
Grade Au
(g/t)
Grade Ag
(g/t)
Gold
(oz)
Silver
(oz)
2.77
1.70
1.91
1.39
1.75
4.84
5.19
5.12
4.72
5.01
54,000
95,000
140,000
427,000
194,000
522,000
59,000
201,000
253,000
723,000
Summary 2020 Tavşan JORC 2012 compliant Mineral Resource Estimate. Reporting is based on a 0.7 g/t Au cut-off grade.
Resource estimate dated 8 June 2020. Figures in the table may not sum precisely due to rounding.
Zone
Ardala
Tonnes
(t)
Grade Au
(g/t)
Grade Ag
(g/t)
Grade Cu
(ppm)
Grade Mo
(ppm)
Gold
(oz)
Silver
(oz)
Copper
(t)
Molybdenum
(t)
Inferred
66,423,000
0.44
1.57
1,656
65
939,000 3,359,000
110,000
4,300
Summary 2020 Salinbas and Ardala JORC 2012 compliant Mineral Resource Estimate. Reporting is based on a 0.5 g/t Au cut-off grade for the
Salinbaş mineralisation and 0.25 g/t Au for the Ardala mineralisation. Resource estimate dated 29 July 2020. Figures in the table may not sum
precisely due to rounding.
Resource Estimate for Kizilҫukur:
Resource Estimate for Ivrindi:
Classification
Measured
Indicated
Measured & Indicated
Inferred
Global Total
Tonnes
(t)
130,511
87,805
218,317
37,344
255,660
Grade Au
(g/t)
Grade Ag
(g/t)
Gold
(oz)
Silver
(oz)
2.79
2.60
2.72
1.75
2.57
84.11
69.01
78.04
57.31
75.01
12,000
353,000
7,000
195,000
19,000
548,000
2,000
69,000
21,000
617,000
Summary 2020 Kizilçukur JORC 2012 compliant Mineral Resource Estimate. Reporting is based on a 1.0 g/t Au cut-off grade. Resource estimate
dated 9 May 2020. Figures in the table may not sum precisely due to rounding.
Classification
Inferred
Tonnes
(t)
207,000
Grade Au
(g/t)
Grade Ag
(g/t)
1.7
n/a
Gold
(oz)
11,000
Silver
(oz)
n/a
Summary 2013 Ivrindi JORC 2012 compliant Mineral Resource Estimate. Reporting is based on a 1.0 g/t Au cut-off grade. Resource estimate
dated 11 October 2013. Figures in the table may not sum precisely due to rounding.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Financial Review
The Group recorded a profit before tax for the year of
£5 million, compared to £7 million in the prior year.
The key driver of this was the decline in profitability of
our Joint Venture company, Zenit Madencilik San. ve
Tic. A.S. (“Zenit”), where our share of their profit for the
year reduced by £1.4 million, as set out in note 6 to the
accounts. Despite the price of gold being strong over the
period, and operationally the Company remaining very
robust, the decline in performance was in part due to
the lower grade ore being processed through the plant.
However, the JV company remains in a very strong
position, having paid off all its original capital loans,
and the plant is currently being expanded to increase
throughput to match the expanding resource base.
Otherwise on the Group Income Statement front, there
are few surprises – costs remain broadly constant year
on year, with no write downs of previously capitalised
exploration expenditure. Within Other Comprehensive
Income, there continues to be a large charge recorded
in respect of the foreign exchange loss due to the
weakening Turkish Lira. This represents the revaluation
of Group assets denominated in Lira, so does not
directly impact us operationally. Fortunately, our implicit
revenue stream from Zenit’s gold production is directly
linked to the US dollar denominated price of gold.
As far as the Statement of Financial Position is
concerned, our primary assets are our aforementioned
investment in Zenit, which increased in value due
to our share of the company’s net assets increasing
year on year, along with our investment in Salinbaş.
As referenced in note 26, the Group concluded the
disposal of both these assets in February 2021, and
so we have transferred the cost of Salinbaş to current
assets at the year end to reflect this. In the future
we will continue to record our ongoing investment in
23.5% of the share capital of the enlarged Zenit by way
of equity accounting, i.e. our share of that company’s
profits and net assets, in our published accounts.
The Statement of Financial Position also reflects our
earn-in to our Cyprus venture – at the year end we had
spent £1.2 million, which is being converted to share
capital as we earn into our full 50% stake in due course.
In cash terms the Group performed strongly with a net
increase in cash of £2.5 million, arising mainly from
repayment of loans and dividends from Zenit.
The disposal of part of our interests in Turkey for a
consideration before costs and taxation of US$35.75
million (with a further US$2 million due to be paid
in instalments following the transfer of the Satellite
Projects), approved by shareholders prior to the year
end but concluded in February of this year, together
with the capital reorganisation finalised through the
Courts in June of this year, has put the Group firmly on
a path towards payment of dividends going forward; a
suitable return for our loyal shareholders.
Dr Kerim Sener
Managing Director
Organisation Review
ARIANA EXPLORATION
& DEVELOPMENT LTD
100% Ariana
INVESTMENTS
ASGARD METALS
PTY LTD
(AUSTRALIA)
PORTSWOOD
RESOURCES LTD
(BVI)
WESTERN TETHYAN
RESOURCES LTD
VENUS MINERALS LTD
100% Ariana
100% Ariana
75% Ariana
37.5% Ariana*
GALATA MADENCILIK
SAN VE TIC LTD
100% Ariana
ZENİT MADENCILIK SAN
VE TIC AS
TURKEY
23.5% Ariana
TAVŞAN PROJECT
KIZILETEPE MINE
PRODUCING ASSET
SALINBAŞ PROJECT
Note: Simplified organisational structure. Ownership structures as at 13 July 2021.
*Ariana expecting to complete its earn in to 50% of Venus Minerals Ltd. by end of 2021.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Directors
Michael de Villiers B. Comm. Professional Accountant (SA) MIOD
Chairman and Company Secretary
Michael qualified as a Professional Accountant with Ernst & Young
in Cape Town. He gained his experience as Financial Manager
at mining and chemicals operations in Botswana, Bulgaria, FSU,
Ghana, Namibia and the United Kingdom. He was previously
CFO of Eurasia Mining plc, Finance Director of Mercator Gold
(now ECR Minerals plc), Oxus Gold plc and Navan Mining plc.
He has over 30 years’ experience in the mining industry.
Michael is Chairman of the Audit Committee and
serves on the Sustainability Committee.
Kerim Sener BSc (Hons) MSc DIC PhD
Managing Director
Kerim graduated from the University of Southampton with a
first-class BSc (Hons) degree in Geology in 1997 and from the
Royal School of Mines, Imperial College, with an MSc in Mineral
Exploration in 1998. After working in gold exploration and mining
in Zimbabwe, he completed a PhD at the University of Western
Australia in 2004. Since then he has been responsible for the
discovery of over 3.8Moz of gold in eastern Europe. Kerim is
also Non-Executive Chairman of LSE-listed Panther Metals plc.
Since 2020 he has been based in Perth, Western Australia.
Kerim is a Fellow of The Geological Society of London,
Member of The Institute of Materials, Minerals and Mining,
Member of the Chamber of Geological Engineers in Turkey
and a member of the Society of Economic Geologists.
William Payne BA (Hons) ACA
Non-Executive Director and Chief Financial Officer
William studied Accountancy at Exeter University before
training and qualifying as a Chartered Accountant with KPMG in
London. In 2003, he became a partner in top 20 accountancy
practice Wilkins Kennedy LLP at their London office, which
is now part of Azets where he is currently Regional CEO.
William is Chairman of the Remuneration Committee
and serves on the Audit Committee.
Chris Sangster BSc (Hons), ARSM, GDE, FIMMM
Non-Executive Director
Chris is a mining engineer with over 40 years’ experience in the
mining industry. He has a BSc Hons in Mining Engineering from
the Royal School of Mines, Imperial College in London and a GDE
in Mineral Economics from the University of Witwatersrand and is
a Fellow of the Institute of Materials Minerals and Mining. Chris has
extensive experience in gold, diamond and base metal production
environments. He held positions of Vice President Mining Services
at KCM PLC and Principal Mining Engineer for Australian Mining
Consultants. He co-founded ASX / AIM listed Scotgold Resources
and was its Managing Director following which he became a Non-
Executive Director and Technical Consultant from late 2014.
Chris is Chairman of the Sustainability Committee
and serves on the Remuneration Committee.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT
Operational Team
Fatma Yildiz BSc (Hons)
General Manager
Fatma is a Turkish national and has 13 years of
experience in the mining sector in Turkey. She
graduated from Cukurova University in 2007 with
a BSc degree in Mining Engineering. In addition to
being our General Manager, she is also responsible
for managing the administrative and legal
requirements of our exploration/operational licenses,
applications and formal reporting for licenses.
Fatma is a member of the Chamber of
Mining Engineers of Turkey, holder of a
technical inspector certificate and an
occupational health and safety certificate.
Berkin Uğurlu BSc (Hons)
Exploration Manager
Mathew Cooper BSc (Hons)
Senior Geophysics Advisor
Berkin graduated from the Middle East Technical
University with a BSc degree in Geology in 2004.
He worked with Teck in Turkey for four years before
spending a further four years as a Senior Consultant.
Following this he was appointed as Country Manager
for Tigris-Eurasia Madencilik, originally a subsidiary of
Royal Road Minerals, where he worked for four years.
He has experience managing all aspects of mineral
exploration programmes from project generation
through to resource and reserve drilling and technical
reporting including to NI 43-101 and JORC standards.
Mathew has over 20 years experience working as
a geophysicist for airborne and ground acquisition
contractors and mining and exploration companies,
including Normandy Exploration, with the last 13 years
as a consultant, manager and Director largely with
Core Geophysics. He has been involved in a number
of exploration successes whilst working on a range of
projects, both within Australia and internationally. He has
worked on a large variety of commodities including gold,
iron ore, base metals, diamonds, uranium and oil and
gas plays. Mathew is based in Perth, Western Australia.
He is a member of the Society of Economic
Geologists, a board member of the Mining
Geologists Association and a member of the
Chamber of Geological Engineers in Turkey. He
holds a IHA0 drone pilot qualification in Turkey.
Mathew is a member of the Australian Society
of Exploration Geophysicists, Society of
Geophysicists, and the Australian Institute
of Geoscientists.
Zack van Coller BSc (Hons)
Special Projects Geologist
Zack graduated from Cardiff University with a BSc (Hons)
degree in Exploration and Resource Geology in 2010. As
leader of our Special Projects Team, he is responsible
for advancing our project pipeline, in addition to being
involved in various exploration programmes across
Turkey. He was involved in the development of the
highly successful lithium strategy pursued by Asgard
Metals Pty. Ltd. on behalf of Ariana. He has also been
involved in advanced project development of a high-
sulphidation Cu-Au deposit in the Republic of North
Macedonia. Zack is bilingual in English and Afrikaans.
Zack is a member of the Geological Society of
London and he operates primarily between the
UK and Turkey.
Ruth Bektaş BSc (Hons) CGeol EurGeol
Project Analyst
Elif Gümüşlüoğlu BSC (Hons) MSc
Remote-sensing Specialist
Elif has 11 years of experience in the mining sector in
Turkey, having graduated from Hacettepe University in
2003 with a BSc (Hons) in Geological Engineering and
from Anadolu University in 2007 with MSc in Remote
Sensing & Geographical Information Systems (GIS).
She initially worked with INTA Space Turk Company
in 2007 on satellite image processing before joining
the Company in 2008. From the end of 2008 to
2019 she worked as a data manager and deputy
general manager of the Salinbas Project JV before
transferring back to us as Project Manager responsible
for the administrative and data management
requirements of our Salinbaş Project prior to it
becoming part of the Zenit JV. She also provides
specialist skills in remote-sensing to the Company.
She is a member of the Chamber of
Geological Engineers of Turkey and has a
safe driving certificate. She holds a IHA0
drone pilot qualification in Turkey.
Ruth graduated from the University of Leicester with
a BSc (Hons) degree in Applied and Environmental
Geology in 2013. As Project Analyst, through
geological, resource and financial modelling she is
responsible for identifying new projects to add to
our portfolio. Ruth worked with Ariana and Zenit
from 2013 to 2018 and was involved in bringing the
Kiziltepe Project from exploration to production stage.
She has since been with Tetra Tech as a Resource
Geologist, working on a range of projects around
the world, reporting in line with NI 43-101 and JORC
standards. Ruth is bilingual in English and Turkish.
Ruth is a Chartered Geologist of the Geological
Society of London (CGeol) and the European
Federation of Geologists (EurGeol). She is also a
member of the Society of Economic Geologists.
Selim Senoz BSc (Hons)
Geological Database Manager
Selim graduated in 2001 with a BSc in Geological
Engineering from Dokuz Eylül University in Izmir.
He is responsible for updating our information
systems databases, managing our geographic
information systems and drilling data. He is
the Company’s designated QA/QC officer and
has worked with the Company since 2006.
He is a member of the Chamber of Geological
Engineers of Turkey.
Field Team
Burak Mert BSc (Hons)
Project Geologist
Furkan Oğuz BSc (Hons)
Exploration Geologist
Tuncay Yavuz
Senior Technician
Ismail Aksoy
Field Technician
Our full team can be viewed
at arianaresources.com
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Key Performance Indicators
Risks & Uncertainties
Financial KPIs
PRODUCTION RISK
EXPLORATION AND DEVELOPMENT RISK
Production Success
Enhancing profits through efficient mining operations and
successful conversion of Resources to Reserves.
DESCRIPTION
DESCRIPTION
Exploration Expenditure
Enhancing intangible exploration assets through targeted expenditure.
Cash Flow Forecasts
Regular cash flow monitoring to ensure exploration targets
are met and that working capital is maintained.
Operational KPIs
Operational Success
Increasing JORC compliant resources and progressing advanced
projects through development and into production.
Advance Portfolio
Through acquisition or discovery of new exploration properties
utilising on-going exploration to target new ground.
Environmental, Health & Safety
Ensuring that all efforts are made to minimise adverse
personal, corporate and environmental outcomes, through
best practice training, implementation and monitoring.
Mining activity involves a variety of potential risks
to production or interruptions to output. These
can include geological, mining, processing,
environmental and financial risks.
MITIGATION
The Joint Venture company reviews mining
progress on a regular basis to determine any
potential risk factors that could affect production
negatively. The Joint Venture employs
experienced management staff.
Inherent risks associated with the failure
to discover or develop an economically
recoverable ore reserve, to conclude a
definitive feasibility study, and to obtain
the necessary consents and approvals for
the conduct of exploration and mining.
MITIGATION
The Board is committed to reviewing
progress relating to the development of its
various exploration targets and assesses this
against planned expenditure and expected
outcomes. The Group employs highly
trained geologists with extensive knowledge
of mineral exploration, with a particular
expertise in precious metal mineralisation.
PARTNER RISK
DESCRIPTION
Any joint venture arrangement contains an
element of counterparty risk.
MITIGATION
The Company maintains good working
relationships with our Joint Venture partners
and monitor their financial condition and
commitment on a regular basis.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Risks & Uncertainties continued
POLITICAL / IN-COUNTRY RISK
FOREIGN CURRENCY RISK
FINANCING RISK
DESCRIPTION
DESCRIPTION
Political instabilities, which could cause the loss
of an asset through expropriation, war or unrest.
Exploration or mining licences applied for might
not be granted or renewed.
The Group’s results are sensitive to foreign
currency movements and in particular with its
exposure to the Turkish Lira, arising from the
Group’s primary operations being in Turkey.
DESCRIPTION
This is the risk of running out of
working and investment capital.
MITIGATION
The Group has recently completed its
partial divestment of its interest in Turkey
in exchange for cash. Consequently
there is limited finance risk.
In addition, the Group continues to receive
cash flow from its joint venture investment
in an operational gold mine. The Group may
also issue new share capital, and may include
bank borrowing where appropriate, to finance
its activities.
MITIGATION
MITIGATION
The Group has spread its political risk exposure
by developing active interests in several
countries, including Australia, Cyprus, Kosovo
and Turkey. As the location of our joint venture
mining project, Turkey benefits from a robust
political environment and has established fiscal
and mining codes. The Group enjoys a good
working relationship with the relevant authorities
in Turkey and has a permanent management
team in the country to monitor developments.
ENVIRONMENTAL / SAFETY RISK
DESCRIPTION
Major pollution arising from operations and/or
loss of life due to systems or equipment failure.
MITIGATION
The Group adopts best practice in the industry
with on-site, country level and corporate level
policies and procedures.
The Group finances its operations through
the cash flow generated from its share of
profits from our investment in our joint venture
gold mining company. The Group maintains
the majority of its cash in Pounds Sterling
and United States Dollars and continues
to monitor relevant currency movements
and considers action where appropriate.
COVID-19 RISK
DESCRIPTION
The recent escalation in the spread of COVID-19
worldwide poses a threat to the continuation
of mining operations if a widespread infection
were to occur at the Kiziltepe Mine.
MITIGATION
Government guidance on the pandemic
in our operating countries, particularly in
the UK and Turkey, is being kept under
review. Risk mitigation procedures were
implemented rapidly and well-ahead of
government guidance, to ensure safe working
practices were maintained for our staff.
Staff have been supportive of these new
methods of working and have adapted
quickly to them. Despite a significant
weighting towards remote-working within
the business, there has been no measurable
detrimental impact to business activity.
COMMODITY RISK
DESCRIPTION
A potential fall in commodity prices which
could lead to it becoming uneconomic
for the Group to mine its assets.
MITIGATION
The Group’s principal interest is gold and
silver and the outlook for gold remains
broadly positive as a continuing safe
haven vehicle for wealth protection. The
Group will consider the use of appropriate
hedging products to mitigate this risk.
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STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Section 172(1) Statement - Promotion of the Company
for the benefit of the members as a whole
The Directors believe they have acted in the way most likely to promote the success of the Company for the benefit
of its members as a whole, as required by s172 of the Companies Act 2006.
The requirements of s172 are for the Directors to:
• Consider the likely consequences of any decision in the long term;
• Act fairly between the members of the Company;
• Maintain a reputation for high standards of business conduct;
• Consider the interests of the Company’s employees;
• Foster the Company’s relationships with suppliers, customers and others; and
• Consider the impact of the Company’s operations on the community and the environment.
The application of the s172 requirements can be demonstrated in relation to the some of the key decisions made
during 2020:
• Continuing evaluation of existing license areas and assessment of projects;
• Undertaking various technical studies as part of the operating licence process;
• Identifying and refining both new and previously defined drill targets;
• Further identification of drill targets across projects whether held within the joint venture or not;
• Completion of diamond and Reverse Circulation drill programmes at various projects;
• Commencement of resource estimation for the projects in accordance with JORC reporting standards; and
• Continued assessment of corporate overheads, expenditure levels and wider market conditions.
As a mining exploration and development Group operating primarily in Europe, the Board takes seriously its ethical
responsibilities to the communities and environment in which it works. We abide by the local and relevant UK laws
on anti-corruption and bribery. Wherever possible, local communities are engaged in the geological operations and
support functions required for field operations, providing much needed employment and wider economic benefits
to the local communities. In addition, we follow international best practice on environmental aspects of our work.
Our goal is to meet or exceed standards, in order to ensure we maintain our social licence to operate from the
communities with which we interact. The interests of our employees are a primary consideration for the Board.
Personal development opportunities are supported and a health and safety support network is in place to assist with
any issues that may arise on field expeditions.
3 2
3 3
Kiziltepe drill core logging using
tablet for direct database input.
STRATEGIC REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020STRATEGIC REPORT Corporate Governance
The Ariana Board of Directors aims to conform
to statutory responsibilities and industry good
practice in relation to corporate governance of
the Company and its subsidiaries. The Board has
adopted the latest version of the QCA Corporate
Governance Code (2018) (“QCA Code”) and strives
to follow the 10 principles outlined within it to the
fullest extent possible taking into consideration
the stage of development of the Company.
Details of how the Company addresses the key
governance principles defined in the QCA code are
set out below, and are found in more detail on the
Company’s website in accordance with AIM Rule 26.
1. Business model and strategy
The Board has developed and implemented a strategy
and business model which it believes will achieve
long term value for shareholders. This strategy
and business model is clearly explained in the
Strategic Report and on the Company’s website. The
Company believes that this strategy and business
model is appropriate to protect the Company from
unnecessary risk and secure its long-term future.
2. Understanding shareholder
needs and expectations
The Board is committed to maintaining good
communications and seeks to understand and meet
shareholder needs and expectations by engaging with
them across a range of formal platforms. This includes
regular interaction through investor presentations,
Q&A forums, investor relations services, an investor
portal available on the website, and social media sites
as well as its Annual General Meeting. The Company
provides phone numbers on all its updates and RNS
announcements where shareholders can contact
the appropriate senior Company representatives or
advisors directly with their queries together with a
dedicated email address for shareholder feedback.
3. Considering wider stakeholder
and social responsibilities
The Board recognises that the long-term success
of the Company is reliant upon the efforts of
the employees of the Company and its partners,
contractors, suppliers, regulators and other
stakeholders. The Board has put in place a range
of processes and systems to ensure that there is
close oversight and contact with its key resources
and relationships. For example, all employees of
the Company participate in a structured Company-
wide annual assessment process which is designed
to ensure that there is an open and confidential
dialogue with each person in the Company to help
ensure successful two way communication with
agreement on goals, targets and aspirations of
the employee and the Company. These feedback
processes help to ensure that the Company can
respond to new issues and opportunities that arise to
further the success of employees and the Company.
The Company’s principal area of operations is in
Eastern Europe. The Company is committed to
cultivating and maintaining good relations with all
stakeholders and its strategy and business model
are designed to minimise any potential negative
impact of its activities and of those working on its
behalf, on the communities where it operates and
on the environment. The Company has established a
positive working relationship with governments, non-
government organisations and local communities with
whom it holds regular meetings to appraise them of
the Company’s plans. The Company firmly believes that
the mining and exploration development projects that
form the basis of its business model will substantially
benefit the countries and regions in which it operates.
The Company provides open and clear communication
channels and points of contact for all its stakeholders
and has a robust communication system in place
to ensure all concerns are quickly brought to the
Board and senior management’s attention.
4. Risk management
In addition to its other roles and responsibilities,
the Audit Committee is responsible to the Board for
ensuring that procedures are in place and are being
implemented effectively to identify, evaluate and
manage the risks faced by the Company. The Company
recognises that it is exposed to risks which may
negatively impact on its business operations. It takes all
reasonable steps to identify, assess the impact of and
mitigate these risks wherever possible. These risks are
clearly identified on page 29-31 of the Strategic Report.
The following risk assessment matrix sets out
those risks, and identifies their ownership and the
controls that are in place. This matrix is updated
as changes arise in the nature of risks or the
controls that are implemented to mitigate them.
The Audit Committee reviews the risk matrix
and the effectiveness of scenario testing on a
regular basis. The following principal risks and
controls to mitigate them, have been identified:
Activity
Risk
Impact
Control(s)
Operation
Injury to staff
Injury to staff whilst operating heavy
machinery in remote locations
Regulatory
adherence
Breach of rules
Censure or withdrawal of authorisation
Creating a safe working
environment through strict
procedures and regular training
Strong compliance regime instilled
at all levels of the Company
Strategic
Market downturn
Change in macro-economic conditions Ongoing monitoring of economic
events and markets
Failure to deliver
commercially
Inability to operate efficiently
and economically
Active operational monitoring and
experienced management
Financial
Misappropriation
of funds
Fraudulent activity and loss of funds
IT security
Loss of critical financial data
Robust financial controls and
segregation of duties
Regular back up of data online
and locally
The Directors have established procedures, as
represented by this statement, for the purpose of
providing a system of internal control. An internal
audit function is not considered necessary or practical
due to the size of the Company and the close day
to day control exercised by the executive Director.
However, the Board will continue to monitor the
need for an internal audit function. The Board works
closely with and has regular ongoing dialogue with
the outsourced finance function and has established
appropriate reporting and control mechanisms to
ensure the effectiveness of its control systems.
The outbreak of the recent global COVID-19
virus has resulted in increased risks within the
global economy. The extent of the effect of the
virus, including its long-term impact, remains
uncertain and the Company continues to monitor
the situation while adopting the recommended
precautions to ensure the safety of employees.
5. A well-functioning Board of Directors
The Board comprises a Chairman, Michael de Villiers,
a Managing Director, Dr Kerim Sener and two Non-
Executive Directors, William Payne and Chris Sangster.
Chris Sangster is considered by the Board to be an
independent director, having been appointed in
2016 and since having acted in a primarily technical
capacity. In accordance with the Articles of Association
of the Company, one third of the Board is required to
retire each year at the Company’s AGM but Directors
resigning can put their name forward for re-election.
The Executive Director dedicates 100% of his
contractually required time to the Group. The Non-
Executive Directors dedicate as much time as is
required for them to fully carry out their duties for the
Group including overseeing corporate governance
arrangements and serving on board committees
with the ultimate responsibility for the quality of,
and approach to, corporate governance lying with
the Chairman, Michael de Villiers who also serves as
the Company Secretary and William Payne who acts
as the Chief Financial Officer. It is recognised that
an additional independent Non-Executive Director
would benefit the Company and it will appoint such
an independent director at the appropriate time so
as to comply with the Code. It is also recognised
that the finance function is currently carried out by
a Non-Executive Director and his supporting team
in the UK. William Payne’s accountancy services and
that of Michael de Villiers, provides effective and
well suited finance experience to the Company.
The Board is responsible for formulating, reviewing and
approving the Group’s strategy, budgets, major items of
capital expenditure and acquisitions. An agenda and all
supporting documentation is circulated to the Directors
before each Board meeting. Open and timely access
to all information is provided to Directors to enable
them to bring independent judgement on issues
affecting the Group and facilitate them in discharging
their duties. The Board met regularly during the last
financial year to 31 December 2020. Generally, no
individual director is absent for more than one board
meeting during any given year. The Board has three
sub-committees: the Audit Committee, Remuneration
Committee and Sustainability Committee. Governance
and Nominations are dealt with by the entire Board.
The Company reports annually on the number of
Board and committee meetings held during the year
and the attendance record of individual Directors.
In order to be efficient, the Directors meet formally
and informally both in person and by telephone.
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE Corporate Governance continued
5. A well-functioning Board
of Directors continued
Details of the Directors’ attendance at formal
board meetings are set out below:
Meetings
Attended
Meetings eligible
to attend
Kerim Sener
Michael de Villiers
William Payne
Chris Sangster
3
3
3
3
3
3
3
3
The Board is accountable to the shareholders for
delivery of sustained value growth. In order to
support its duties and responsibilities the Board
implements control procedures that assess and
manage risk and ensure robust financial and
operational management within the Group.
The Board sets the Group’s strategy and monitors
its implementation through operational and financial
performance reviews. It also works to ensure that
adequate resources are available to implement strategy
and exploit opportunities in an appropriate manner.
6. Appropriate skills and
experience of the Directors
The Board members have a diverse range of skills
and experience spanning technical, financial and
operational areas relevant to the development and
management of the Company. Summary biographies
of each Board member are shown on pages 24-26.
Directors keep their skill sets up to date by attendance
at, and participation in, various events organised by
their respective industry sectors and by participation
in continuing professional development courses. As
the Company evolves, the Board will be reviewed
and expanded if necessary to ensure appropriate
expertise is always in place to support its business
activities. The Board recognises that it currently has a
limited diversity and this will form a part of any future
recruitment consideration if the Board concludes that
replacement or additional Directors are required.
Where necessary the Board has engaged external
professional consultants on an ongoing basis to
ensure the Company is meeting its strategies. The
key advisers to the Company are set out on page 80.
The Board engages external geologists, environmental
specialists and a number of other specialised
consultants to produce the required surveys and
reports for the Environmental Impact Assessment,
Social Impact Assessment and Feasibility Studies.
The Board have ensured that the all external advisers
are knowledgeable and provide the required skillset.
7. Evaluation of board performance
The performance of the executive management of
the Company is evaluated on an on-going basis by
the Remuneration Committee (“Remcom”) which is
composed of William Payne and Chris Sangster. The
results of these evaluations are reflected in changes
in the executive remuneration levels recommended
by the Remcom from time to time and in awards
under the Company’s Share Option and Management
Incentive Schemes where it considers such awards
are warranted. As the Company grows, the Board will
develop more comprehensive human resource policies
to provide both internal and external performance
evaluations of its Board, senior management and staff
including the provision for upskilling where necessary
and to provide for Board member succession
planning. The Board considers that the corporate
governance policies it has currently in place for Board
performance reviews is commensurate with the size
and development stage of the Company and well
within the norms of the peer group and industry.
8. Corporate culture
The Company operates directly across several
countries including the UK, Turkey, Holland, BVI
and Australia.
In line with its international reach, the Company
recognises the cultural diversity both internally and
among its business partners, service providers and
other stakeholders. The Board recognises that their
decisions regarding strategy and risk will impact the
corporate culture of the Company as a whole and
that this will impact the performance of the Company.
The Board is very aware that the tone and culture set
by the Board will impact all aspects of the Company
as a whole and the way that employees behave. The
corporate governance arrangements that the Board
has adopted are designed to ensure that the Company
delivers long-term value to its shareholders and
that shareholders have the opportunity to express
their views and expectations for the Company in a
manner that encourages open dialogue with the board
through formal regulated channels. A large part of the
Company’s activities is centred upon what needs to
be an open and respectful dialogue with employees,
partners and other stakeholders. Therefore, the
importance of sound ethical values and behaviours
is crucial to the ability of the Company to achieve
its corporate objectives successfully. The Board
places great importance on this aspect of corporate
life and seeks to ensure that this flows through all
that the Company does. The Directors consider
that at present the Company has an open culture
facilitating comprehensive dialogue and feedback
and enabling positive and constructive challenge.
The Company has adopted, with effect from the
date on which its shares were admitted to AIM,
a code for Directors’ and employees’ dealings in
securities which is appropriate for a company
whose securities are traded on AIM and is in
accordance with the requirements of the Market
Abuse Regulation which came into effect in 2016.
9. Maintenance of governance
structures and processes
Ultimate authority for all aspects of the Company’s
activities rests with the Board, the respective
responsibilities of the Chairman and Managing
Director arising as a consequence of delegation
by the Board. The Board has adopted appropriate
delegations of authority which set out matters
which are reserved to the Board. The Chairman
is responsible for the effectiveness of the Board,
while management of the Company’s business
and primary contact with shareholders has been
delegated by the Board to the Managing Director.
Audit Committee
Michael de Villiers and William Payne
This committee has primary responsibility for
monitoring the quality of internal controls and ensuring
that the financial performance of the Company is
properly measured and reported. It receives reports
from the executive management and auditors
relating to the interim and annual accounts and
the accounting and internal control systems in use
throughout the Company. The Audit Committee shall
meet not less than twice in each financial year and it
has unrestricted access to the Company’s auditors.
Remuneration Committee
William Payne and Chris Sangster
The Remuneration Committee reviews the performance
of the Executive Director and employees and makes
recommendations to the Board on matters relating
to their remuneration and terms of employment.
The Remuneration Committee also considers and
approves the granting of share options pursuant to
the share option plan and the award of shares in lieu
of bonuses pursuant to the Company’s Remuneration
Policy. The Remuneration Committee reviews
overall remuneration against industry peer group
companies on a regular basis and takes professional
advice as and when it is deemed necessary.
Sustainability Committee
Chris Sangster and Michael de Villiers
The Sustainability Committee is formed of the
two Directors who have prior operational and
industry experience and may include other
management who are responsible for developing
and implementing policy and procedures.
The Company is committed to providing all employees
a safe place to work in accordance with our HSE
goals. This will be accomplished by providing safe
equipment to operate, proper training and safe
methods and procedures. The Company will at
a minimum, comply with all applicable industry
norms for rules and regulations. Any risk of injury
that can arise remains our primary concern.
Nominations Committee
The Board has agreed that appointments to the
Board will be made by the Board as a whole and
so has not created a Nominations Committee.
Directors Fiduciary Duties
In accordance with the Companies Act 2006, the
Board complies with: a duty to act within their powers;
a duty to promote the success of the Company; a
duty to exercise independent judgement; a duty to
exercise reasonable care, skill and diligence; a duty
to avoid conflicts of interest; a duty not to accept
benefits from third-parties and a duty to declare any
interest in a proposed transaction or arrangement.
10. Shareholder communications
The Board is committed to good communications
with the market and constructive dialogue with
shareholders. For regulatory purposes, this is strictly
managed by our public relations advisors. Similarly,
institutional shareholders and analysts have the
opportunity to discuss issues and provide feedback
to the Company. All shareholders are encouraged
to attend the Company’s Annual General Meeting.
Investors have access to current information on
the Company though our website, https://www.
arianaresources.com, and via other designated investor
platforms. Management is available to answer investor
enquiries through formal Q&A sessions arranged
periodically through the year. The Company proposed
in 2018 to make greater use of on-line meetings.
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE
Corporate Responsibility
Ariana has always been committed to socially
responsible and environmentally conscious exploration
and mining. Since the commencement of work on
our Kiziltepe gold mine, Ariana has worked to build
strong links with local communities and to establish
relationships of trust with all stakeholders. Whilst
work on establishing vital stakeholder links often
occurs in the background, its importance cannot
be under-estimated. Without these concerted
efforts and commitment to integrity, we could
not have achieved the sound relationships with
government organisations, local communities and
JV partners, which have underpinned Ariana’s
success. In addition, the Company has in place
an Anti-Corruption and Anti-Bribery Policy.
Shareholders
The Board of Directors encourages communications
with shareholders via formal Q&A sessions
and seeks to protect shareholders’ interests
at all times. More information can be found
in the Corporate Governance section.
Employees
Ariana has always attached great importance to
employees’ professional development and the creation
of employment in the localities where we operate. The
Company provides fair remuneration, flexible working
arrangements where practical and exposure to wider
aspects of the Company’s operations. The Company
gives full and fair consideration to applications for
employment received irrespective of age, gender,
colour, ethnicity, disability, nationality, religious beliefs
or sexual orientation. More information on Ariana’s
Employee policy can be found on its corporate website.
Governmental organisations
Ariana has many years’ experience across Eastern
Europe and has an in-depth understanding of
business within this broad region. The Company
focuses on building good relationships with
government organisations and local authorities. We
have developed a track record of being diligent in
following government guidelines in all aspects of our
work. Ariana works with JV partners local to each
project, such as Özaltin Holding A.S. and Proccea
Construction Co. in Turkey and Western Tethyan
Resources in Kosovo, ensuring that financial benefits
also accrue to the countries in which we work.
Local Communities
Environmental
From our inception, Ariana has been committed to a
sustainable and environmentally responsible approach to
exploration and mining. Using cutting edge technologies
and innovative working practices, we aim to achieve our
environmental goals in faster and better ways.
We have implemented operating guidelines to ensure
that specific environmental standards are met by our
exploration and mining teams. Our operations comply
with local environmental standards and we operate under
the relevant certification from government departments.
We have adopted agile new technologies and working
practices to help us reduce our carbon footprint. Our
early adoption of portable XRF technology greatly
reduces our carbon footprint, as samples can be
analysed locally, instead of sending them to distant
locations for analysis. Our deployment of Geotek
BoxScan technology for drill cores also ensures we
can analyse drill-cores locally and avoid excessive
transportation. For many years, we have used remote
working team technologies and video-conferencing to
minimise air and road travel.
Measuring our environmental impact is an essential
component of our approach. Ariana’s carbon
Ariana has a strong track record of commitment to
working with local suppliers and employing local
people. Our understanding of local social and business
cultures enables us to develop strong connections
with local businesses and communities. We encourage
collaborative working and aim to ensure Ariana’s values
are reflected in our joint ventures and other partnerships.
In Turkey our Joint Venture company, Zenit Madencilik,
employs local people, including professionally qualified
mining engineers from nearby villages and towns.
Ariana has run many training programmes for these
employees focusing on the mechanical, physical,
technical and safety aspects of its exploration
programmes. Working with the local community to
promote educational standards is also a priority for
Ariana. Through our joint venture we actively support
Sindirgi Elementary School.
We have also supported many community programmes
in the Sindirgi area close to our Kiziltepe mine. Recently,
we have built a new road to the village in our Salinbaş
Project area.
Suppliers & Contractors
The Company has a prompt payment policy and
seeks to ensure that all liabilities are settled within the
supplier’s terms. Through fair dealings the Company
aims to cultivate the goodwill of its contractors,
consultants and suppliers.
Human Rights
Ariana is committed to best-practice in socially and
ethically responsible exploration and mining for the
benefit of all stakeholders. The activities of the Company
are in line with applicable laws on human rights.
Health and Safety
Company activities are carried out in accordance
with its Health and Safety Policy, which adheres to all
applicable laws. Relevant to their job roles, members
of the team have received certification in occupational
health and safety, advanced off-road driving, first-aid
and survival.
In the face of the COVID-19 pandemic, the Company,
working with Zenit Madencililk and our employees,
has met the challenges of implementing COVID-safe
working practices to ensure work at the Kiziltepe Mine
continued without interruption. We are grateful for
the good sense and forbearance of our employees
and suppliers in helping us manage an extremely
challenging situation over the past year.
emissions are estimated to be 0.32 tonnes CO2 per
ounce of gold. The global average for our industry is
0.80 tonnes CO2 per ounce of gold. We are proud that
our carbon footprint is being offset by our reforestation
programme of some 8,000 trees and 17,500 other
plants around the Kiziltepe Mine site. Rehabilitation
work has begun on parts of the waste rock dump,
covering it with topsoil and planting sainfoin, a drought
resistant plant, highly beneficial to bees and other
pollinators. The topsoil storage area has also been
covered in sainfoin to preserve soil quality, as it is a
nitrogen fixing plant.
We keep bees at the Kiziltepe Mine site, as they are a
bellwether for the health of ecosystems. Honey from
our hives is distributed free to local villages. Chickens
and doves are also bred on the site. The local university
prepares a flora and fauna report which we use to
ensure mining activity is not adversely impacting the
local ecosystem.
The joint venture also sponsors firefighting equipment.
Firefighting is a very important local issue, as much of
the upland area in the vicinity of the mine is covered in
protected pine forests.
Honey bee feeding on nectar from
wildflowers within the Kizltepe Mine site.
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE
Report of the Directors
For the year ended 31 December 2020
The Directors present their report with the audited financial statements of the Company and the Group for the year
ended 31 December 2020.
Principal activity
Ariana Resources PLC (the “Company”) is a public limited company incorporated and domiciled in Great Britain. The
address of its registered office and principal place of business is disclosed at the end of this report. The Company’s
shares are listed on the AIM market of the London Stock Exchange. The principal activities of the Company and its
subsidiaries (the “Group”) are related to the exploration for and development of gold and other minerals, with a focus
on Eastern Europe.
Directors
The Directors during the year under review were:
M J de Villiers
A K Sener
W J B Payne
C J S Sangster
The beneficial interests of the Directors holding office either directly or indirectly (including interests held by spouses,
children or associated parties) on 31 December 2020 in the ordinary issued share capital and options of the Company
were as follows:
M J de Villiers
A K Sener
W J B Payne
C J S Sangster
Total
2020
Ordinary Shares
2020
Share Options
2019
Ordinary Shares
2019
Share Options
55,799,142
18,985,526
9,359,314
3,716,844
14,000,000
6,000,000
4,000,000
4,000,000
54,845,000
19,564,252
9,359,314
3,716,844
17,000,000
19,000,000
4,000,000
4,000,000
87,860,826
28,000,000
87,485,410
44,000,000
Further details on share options can be found in note 19 to the financial statements.
Annual General Meeting (AGM) COVID-19 and contingencies
We are keen to welcome shareholders in person to our 2021 Annual General Meeting this year, particularly given
the constraints we faced in 2020 due to the COVID-19 pandemic. At present, it is possible under guidelines to hold
socially distanced meetings with a limited number of shareholders. We are therefore proposing to hold the Annual
General Meeting at the East India Club, 16 St James’s Square, London, SW1Y 4LH on 18 August 2021 at 11.00 a.m. and
to welcome up to 15 shareholders within safety constraints and in accordance with government guidelines.
However, given the constantly evolving nature of the situation, we want to ensure that we are able to adapt these
arrangements efficiently to respond to changes in circumstances. On this basis, should the situation change such
that we consider that it is no longer possible for shareholders to attend the meeting, we will continue to hold the AGM
as a closed-door non-attendance meeting. Should we have to change the arrangements in this way, it is likely that
we will not be in a position to accommodate shareholders beyond the minimum required to hold a quorate meeting
which will be achieved through the attendance of employee shareholders. We will notify shareholders of any changes
to our plans via the appropriate regulated news service (RNS). Any updates to the position will also be included on
our website at https://arianaresources.com/investors/circulars.
Attendance at the meeting
Shareholders intending to attend the Annual General Meeting, should this be possible, are asked to register their
intention as soon as practicable by writing to Computershare Investor Services PLC, The Pavilions, Bridgwater Road,
Bristol BS99 6ZY.
Proxies
Given the uncertainty around whether shareholders
will be able to attend the Annual General Meeting, and
because of tighter restrictions due to a change in the
situation with the COVID-19 pandemic, we encourage all
shareholders to complete and return their proxy forms
appointing the Chair of the meeting, as their proxy. This
will ensure that your vote will be counted if ultimately
you (or any other proxy you might otherwise appoint) are
not able to attend the meeting.
Share capital
Section 561 of the Companies Act 2006 provides that
subject to limited exceptions any shares being issued
must be issued to all existing shareholders pro-rata to
their holding. However, where Directors have a general
authority to allot shares they may be given the power
by the Articles or by a special resolution to allot shares
pursuant to the authority as if the statutory pre-emption
rights did not exist.
An ordinary resolution will be proposed at the forthcoming
Annual General Meeting for the renewal of the Directors’
general authority to issue relevant securities up to an
aggregate nominal amount of £500,000.
A special resolution will also be proposed at the
forthcoming Annual General Meeting for the
renewal of the Directors’ authority to allot relevant
securities for cash without first offering them to the
shareholders pro-rata to their holdings, pursuant
to section 570 of the Companies Act 2006 up to an
aggregate nominal amount of £250,000.
The authority mentioned above will, if passed, expire at
the earlier of the following Annual General Meeting or the
date being 15 months from the passing of the resolutions.
Substantial share interests
The Company had been notified of the following
interests in the Company’s shares held on 30 June 2021.
Shareholder
Hargreaves Lansdown
Nominees Limited
Interactive Investor
Services Nominees Limited
Barclays Direct Investing
Nominees Limited
Ordinary
Shares
% of Issued
Share Capital
217,804,506
20.08%
167,505,439
15.44%
143,021,178
13.19%
Jim Nominees Limited
78,466,840
HSDL Nominees Limited
60,410,110
Mr Michael de Villiers
58,400,000
Mr Stephen Bingham
37,500,000
7.23%
5.57%
5.38%
3.46%
Strategic Report
The Company has chosen, in accordance with Section
414C of the Companies Act 2006, to set out the
following information in the Strategic Report which
would otherwise be required to be contained in the
Directors’ Report:
• Financial risk management objectives;
• Indication of exposure to principal risks;
• Corporate Governance including committee
objectives and memberships;
• Future developments of the business.
The Impact of COVID-19 on the Group
Since March 2020, the Board has made preparations to
mitigate the impact of COVID-19 on the business through
several action plans and mitigation strategies. These will
continue to be monitored and updated as required.
The Impact of Brexit on the Group
The Board has considered the extent of challenges to
our business model and operations arising from the
withdrawal of the United Kingdom from the European
Union (“Brexit”). The Board does not envisage Brexit
has a significant impact on the Group, based on
operations and cash flow generating elements of
the business residing outside the EU. The Group is
sensitive to foreign currency movements and details of
this risk, and mitigation thereof, are outlined within the
Strategic Report on page 31.
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE Report of the Directors
For the year ended 31 December 2020
Dividends
No dividends have been distributed for the year ended
31 December 2020 (2019: £nil) and the retained profit
has been transferred to reserves.
Group’s policy on payment of creditors
It is the Group’s normal practice to settle the terms
of payment when agreeing a transaction, to ensure
suppliers are aware of those terms and to abide by
them. Trade creditor days based on creditors at
31 December 2020 were 30 days (2019: 30 days).
Political and charitable contributions
During the year, the Group made a charitable donation of
£3,000 to the University of Exeter towards the Richard
Osman Memorial Fund. The Group has committed to
supporting this charitable fund until 2022.
No contributions were made for political purposes.
Going concern
The Directors confirm that they are satisfied the Group
has adequate resources to continue in business for the
foreseeable future, having regard to the factors set out
in more detail in Note 1 to the financial statements.
Post year end events
Further details on post balance sheet events can be
found in note 26 to the financial statements.
Statement of Directors’ responsibilities in respect
of the Annual Report and the financial statements
The Directors are responsible for preparing the Annual
Report, Strategic Report, the Directors’ Report and the
financial statements in accordance with applicable law
and regulations.
Company law requires the Directors to prepare group
and parent company financial statements for each
financial year. Under that law they have elected to
prepare both the Group and the parent company
financial statements in accordance with International
Financial Reporting Standards as adopted by the
European Union (IFRSs as adopted by the EU) and
applicable law.
Under company law the Directors must not approve
the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of
the Group and parent Company and of their profit or
loss for that period. In preparing each of the Group and
parent Company financial statements, the Directors are
required to:
• select suitable accounting policies and then
apply them consistently;
• make judgements and estimates that are
reasonable, relevant and reliable;
• state whether they have been prepared in
accordance with IFRSs as adopted by the EU;
• assess the Group and parent Company’s ability
to continue as a going concern, disclosing, as
applicable, matters related to going concern; and
• use the going concern basis of accounting unless
they either intend to liquidate the Group or the
parent Company or to cease operations or have no
realistic alternative but to do so.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the parent Company’s transactions and
disclose with reasonable accuracy at any time the
financial position of the parent Company and enable
them to ensure that its financial statements comply
with the Companies Act 2006. They are responsible for
such internal control as they determine is necessary to
enable the preparation of financial statements that are
free from material misstatement, whether due to fraud
or error, and have general responsibility for taking such
steps as are reasonably open to them to safeguard the
assets of the Group and to prevent and detect fraud
and other irregularities.
The Company is compliant with AIM Rule 26 regarding
the Company’s website.
Under applicable law and regulations, the Directors
are responsible for preparing a Strategic Report and
a Director’s Report that complies with the law and
those regulations.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information
included on the Company’s website. Legislation in the
UK governing the preparation and dissemination of
financial statements may differ from legislation in
other jurisdictions.
Disclosure of information to auditor
The Directors who held office at the date of approval
of this Directors’ report confirm that, so far as they are
each aware, there is no relevant audit information of
which the Company’s auditor is unaware; and each
Director has taken all the steps that he ought to have
taken as a Director to make himself aware of any
relevant audit information and to establish that the
Company’s auditors are aware of that information.
Corporate governance
The Board of Directors
The Directors are responsible for the Group’s system
of internal control and for reviewing its effectiveness.
The risk management process and systems of internal
control are designed to manage rather than eliminate
the risk of failure to achieve the Group’s objectives.
Any such system of internal control can only provide
reasonable but not absolute assurance against material
misstatement or loss.
Full meetings are held regularly to review Group
strategy, direction and financial performance and to
review operational reports from all of the Group’s areas
of operations. The process is used to identify major
business risks, evaluate their financial implications, and
ensure an appropriate control environment.
Certain control over expenditure is delegated to on site
project managers subject to Board control by means of
monthly budgetary reports.
Internal financial control procedures include:
• preparation and regular review of operating
budgets and forecasts;
• prior approval of all capital expenditure;
• review and debate of treasury policy; and
• unrestricted access of Non-Executive Directors
to all members of senior management.
Audit Committee
The Audit Committee comprises Michael de Villiers and
William Payne. The Audit Committee may examine any
matters relating to the financial affairs of the Group and
the Group’s audits.
This includes reviews of the annual financial statements
and announcements, internal control procedures,
accounting procedures, accounting policies, the
appointment, independence, objectivity, terms of
reference and fees of external auditors and such other
related functions as the Board may require.
Remuneration Committee
The committee comprises William Payne and Chris
Sangster. It determines the terms and conditions of the
employment and annual remuneration of the Executive
Director and other senior executives. It consults with
the Managing Director, takes into consideration external
data and comparative third-party remuneration and has
access to professional advice outside the Company.
The key policy objectives of the Remuneration
Committee in respect of the Company’s Executive
Director and other senior executives are:
• to ensure that individuals are fairly rewarded for
their personal contribution to the Company’s overall
performance; and
• to act as the independent committee ensuring that
due regard is given to the interest of the Company’s
shareholders and to the financial and commercial
health of the Company.
Remuneration of the Executive Director and other
senior executives comprises basic salary, discretionary
bonuses, participation in the Company’s share option
scheme and other benefits. The Company’s remuneration
policy with regard to options is to maintain an amount of
not more than 10% of the issued share capital in options
for the Company’s management and employees.
Total Directors’ emoluments are disclosed in note 3 to
the financial statements and the Directors’ options are
disclosed above.
Auditor
In accordance with Section 489 of the Companies Act 2006,
a resolution for the re-appointment PKF Littlejohn LLP as
auditor of the Company is to be proposed at the forthcoming
Annual General Meeting. PKF Littlejohn LLP have expressed
their willingness to continue in office as auditor.
By order of the Board.
Michael de Villiers
Company Secretary
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE
Whilst materiality for the Group financial statements as
a whole was set at £449,000, component materiality
for the joint venture was set at £291,850 based upon
3% of the average of profit before tax and net assets.
Performance materiality was set at 65%. Component
materiality for the subsidiary undertakings ranged
between £110,900 and £291,850. We applied the
concept of materiality both in planning and performing
our audit, and in evaluating the effect of misstatements.
We agreed with the audit committee that we would
report all corrected and uncorrected misstatements
identified during the course of our audit in excess
of £22,450 for the Group and £2,850 for the parent
company, in addition to other identified misstatements
that warranted reporting on qualitative grounds.
Our approach to the audit
In designing our audit, we determined materiality
and assessed the risk of material misstatement in
the financial statements. In particular, we looked
at areas requiring the Directors to make subjective
judgements, for example in respect of assessing
the recoverability of exploration, evaluation and
development expenditure and the carrying value and
recoverability of investments in subsidiaries at parent
company level, and the consideration of future events
that are inherently uncertain. We also addressed the
risk of management override of internal controls,
including evaluating whether there was evidence of
bias by the Directors that represented a risk of material
misstatement due to fraud.
An audit was performed on the financial information of
the Group’s significant operating components which,
for the year ended 31 December 2020, were located
in Turkey and the United Kingdom. The accounting
records of the parent company and all subsidiary
undertakings are centrally located and audited by us
based upon materiality or risk. The key audit matters
and how these were addressed are outlined below.
The Turkish registered joint venture company was
audited by a component auditor under our instruction.
The Group audit team instructed the component
auditor on the significant risk areas to be covered and
determined component materiality. There was regular
interaction with the component auditor during all
stages of the audit.
Key audit matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the financial statements of the current
period and include the most significant assessed risks
of material misstatement (whether or not due to fraud)
we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of
resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in
the context of our audit of the financial statements as
a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters.
Independent Auditor’s Report
To the members of Ariana Resources PLC
Opinion
We have audited the financial statements of
Ariana Resources Plc (the ‘parent company’) and
its subsidiaries (the ‘group’) for the year ended 31
December 2020 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated
and Parent Company Statements of Financial Position,
the Consolidated and Parent Company Statements
of Changes in Equity, the Consolidated and Parent
Company Statements of Cash Flows and notes to the
financial statements, including significant accounting
policies. The financial reporting framework that has
been applied in their preparation is applicable law and
international accounting standards in conformity with
the requirements of the Companies Act 2006 and as
regards the parent company financial statements,
as applied in accordance with the provisions of the
Companies Act 2006.
In our opinion:
• The financial statements give a true and fair
view of the state of the Group’s and of the parent
company’s affairs as at 31 December 2020 and of
the Group’s profit and parent company’s loss for the
year then ended;
• The Group financial statements have been
properly prepared in accordance with international
accounting standards in conformity with the
requirements of the Companies Act 2006;
• The parent company financial statements have
been properly prepared in accordance with
international accounting standards in conformity
with the requirements of the Companies Act 2006
and as applied in accordance with the provisions of
the Companies Act 2006; and
• The financial statements have been prepared
in accordance with the requirements of the
Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those
standards are further described in the Auditor’s
responsibilities for the audit of the financial statements
section of our report. We are independent of the Group
and parent company in accordance with the ethical
requirements that are relevant to our audit of the
financial statements in the UK, including the FRC’s
Ethical Standard as applied to listed entities, and
we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that
the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have
concluded that the Director’s use of the going
concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation
of the Directors’ assessment of the Group’s and
parent company’s ability to continue to adopt the
going concern basis of accounting included a review
of the forecast financial information prepared by
management, a review of management’s assessment
of going concern, and post year end information,
including contracted and committed expenditure.
Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the Group’s or parent company’s
ability to continue as a going concern for a period
of at least twelve months from when the financial
statements are authorised for issue.
Our responsibilities and the responsibilities of the
Directors with respect to going concern are described
in the relevant sections of this report.
Our application of materiality
Materiality
Basis for materiality
Group £449,000
(2019: £490,000)
Company £57,000
(2019: £93,000)
2% of net assets
5% of loss before tax
We consider net assets to be the most significant
determinant of the Group’s financial position and
performance used by shareholders, with the key
financial statement balances being intangible
exploration and evaluation assets and the equity
accounted joint venture, which owns the operating
mine. The basis for calculating materiality was
unchanged from the prior year. The performance
materiality for the Group was £291,850 (2019: £318,500).
The materiality applied to the parent company financial
statements was £57,000, based on a threshold of
5% of loss before tax, in order to obtain coverage
of expenditure in our testing for a non-trading
undertaking. The performance materiality for the
parent company was £39,900 (2019: £65,100).
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE Independent Auditor’s Report
To the members of Ariana Resources PLC
Key Audit Matter
Valuation and recoverability of intangible
exploration assets (refer note 18)
The Group carrying value of intangible assets in
relation to capitalised exploration costs, classified
as at 31 December 2020 within assets held for sale,
amounted to £16,002,000 (2019: £16,404,000) which
represents 50% of the Group’s total assets. There
is a risk that these assets have been incorrectly
capitalised in accordance with the requirements of
IFRS 6 and that there are indicators of impairment
as at 31 December 2020. Exploration and evaluation
assets comprise costs associated with early stage
projects through to advanced exploration projects.
These carrying values are tested annually for
impairment. Determining whether impairment
indicators exist involves significant judgement
by management, including considering specific
impairment indicators prescribed in IFRS 6. As
at 31 December 2020, management were in
addition required to assess whether the asset
held for sale was stated at the lower of carrying
value and realisable value, less costs to sell.
Equity accounted joint venture entity Zenit
Madencilik San ve Tic Ltd (“Zenit”) (refer note 6)
The investment in joint venture has a carrying
value at 31 December 2020 of £11,213,000
(2019: £7,768,000). The Group’s share of profit
during the year ended 31 December 2020
amounted to £6,478,000 (2019: £7,891,000).
The accuracy of equity accounting for the
joint venture is directly reliant on the accuracy
of the financial statements of Zenit which
contain a number of key risk areas.
How the scope of our audit responded
to the key audit matter
Our work included but was not restricted to:
• Confirming that the Group has good title to the
applicable exploration licences, and has fulfilled
any specific conditions therein;
• A review and substantive testing of capitalised
costs including consideration of appropriateness
for capitalisation under IFRS 6;
• We reviewed and discussed management’s
assessment of impairment in accordance with the
requirements of IFRS 6, together with a review of
subsequent events regarding disposal;
• We reviewed independently prepared reports and
resource estimates, including an assessment of the
competence and objectivity of the preparer; and
• We evaluated the disclosures included within the
financial statements.
Our work included but was not restricted to:
• We instructed and monitored the component
auditor and reviewed the component auditor
working papers. Revenue recognition, recoverability
of mining assets, inventory valuation and
compliance with laws and regulations were among
the areas designated as either significant or
identified risks;
• We checked and agreed the GAAP transition
adjustments between the local jurisdiction
financial statements and the Group accounting
framework; and
• We checked the joint venture had been correctly
equity accounted for, including the adequacy of
disclosures, in the financial statements.
• adequate accounting records have not been kept
by the parent company, or returns adequate for our
audit have not been received from branches not
visited by us; or
• the parent company financial statements are not
in agreement with the accounting records and
returns; or
• certain disclosures of Directors’ remuneration
specified by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Responsibilities of Directors
As explained more fully in the Directors’ responsibilities
statement, the Directors are responsible for the
preparation of the Group and parent company financial
statements and for being satisfied that they give a
true and fair view, and for such internal control as
the Directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the Group and parent company financial
statements, the Directors are responsible for assessing
the Group’s and the parent company’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going
concern basis of accounting unless the Directors either
intend to liquidate the Group or the parent company or
to cease operations, or have no realistic alternative but
to do so.
Other information
The other information comprises the information
included in the annual report, other than the financial
statements and our auditor’s report thereon. The
Directors are responsible for the other information
contained within the annual report. Our opinion on the
Group and parent company financial statements does
not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do
not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements
or our knowledge obtained in the course of the audit,
or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent
material misstatements, we are required to determine
whether this gives rise to a material misstatement in
the financial statements themselves. If, based on the
work we have performed, we conclude that there is a
material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion, based on the work undertaken in the
course of our audit:
• the information given in the Strategic Report and
the Directors’ Report for the financial year for which
the financial statements are prepared is consistent
with the financial statements; and
• the Strategic Report and the Directors’ Report
have been prepared in accordance with applicable
legal requirements.
Matters on which we are required to report
by exception
In the light of the knowledge and understanding of the
Group and the parent company and their environment
obtained in the course of the audit, we have not
identified material misstatements in the Strategic
Report or the Directors’ Report.
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE Independent Auditor’s Report
To the members of Ariana Resources PLC
Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high
level of assurance but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of
these financial statements.
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect
of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities,
including fraud is detailed below:
• We obtained an understanding of the Group and
parent company and the sector in which they
operate to identify laws and regulations that
could reasonably be expected to have a direct
effect on the financial statements, including the
equity accounted joint venture. We obtained our
understanding in this regard through discussions
with management and application of our cumulative
audit knowledge and experience of the industry.
We ensured that the audit team collectively had the
appropriate experience with auditing entities within
this industry, facing similar audit and business risks,
and of a similar size.
• We determined the principal laws and regulations
relevant to the Group and parent company in this
regard to be those arising from:
• AIM Rules;
• IFRSs; and
• Local tax laws and regulations.
• We designed our audit procedures to ensure the
audit team considered whether there were any
indications of non-compliance by the Group and
parent company with those laws and regulations.
These procedures included, but were not limited to:
• Making enquiries of management;
• A review of Board minutes;
• A review of legal ledger accounts; and
• A review of regulated news
service announcements.
• As in all of our audits, we addressed the risk of
fraud arising from management override of controls
by performing audit procedures which included,
but were not limited to: the testing of journals,
reviewing accounting estimates for evidence of
bias; and evaluating the business rationale of any
significant transactions that are unusual or outside
the normal course of business.
Because of the inherent limitations of an audit,
there is a risk that we will not detect all irregularities,
including those leading to a material misstatement
in the financial statements or non-compliance
with regulation. This risk increases the more that
compliance with a law or regulation is removed from
the events and transactions reflected in the financial
statements, as we will be less likely to become aware
of instances of non-compliance. The risk is also greater
regarding irregularities occurring due to fraud rather
than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit
of the financial statements is located on the Financial
Reporting Council’s website at: www.frc.org.uk/
auditorsresponsibilities. This description forms part of
our auditor’s report.
Use of our report
This report is made solely to the Company’s members,
as a body, in accordance with Chapter 3 of Part 16 of
the Companies Act 2006. Our audit work has been
undertaken so that we might state to the Company’s
members those matters we are required to state to
them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone, other than
the Company and the Company’s members as a body,
for our audit work, for this report, or for the opinions we
have formed.
David Thompson (Senior Statutory Auditor)
for and on behalf of PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London
E14 4HD
13 July 2020
Top down view of the Kiziltepe Mine.
4 8
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GOVERNANCEARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020GOVERNANCE
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2020
Consolidated Statement of Financial Position
For the year ended 31 December 2020
Continuing operations
Administrative costs
General exploration expenditure
Intangible exploration assets - written off
Other gains
Other income
Operating loss
Profit/(loss) on disposal of equity securities at FVOCI
Share of profit of Joint Venture accounted for using the equity method
Investment income
Profit before tax
Taxation
Profit for the year from continuing operations
Earnings per share (pence) attributable to equity holders of the Company
Note
11a
4
5
6
8
2020
£’000
(1,360)
(35)
-
-
-
(1,395)
-
6,478
7
5,090
(327)
4,763
2019
£’000
(1,242)
(18)
(364)
627
61
(936)
20
7,891
5
6,980
(46)
6,934
Basic and diluted
10
0.45
0.65
Other comprehensive income
Items that are or may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations
(3,647)
(1,774)
Items that will not be classified subsequently to profit or loss:
Net change in fair value of equity securities at FVOCI
13
Other comprehensive loss for the year net of income tax
Total comprehensive profit for the year
The accompanying notes form part of these financial statements.
-
(3,647)
1,116
49
(1,725)
5,209
Note
2020
£’000
2019
£’000
Assets
Non-current assets
Trade and other receivables
Intangible exploration assets
Intangible assets
Land, property, plant and equipment
Earn-In advances
Investment in Joint Venture accounted for using the equity method
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
15
11a
11b
12
13
6
16
Assets classified as held for sale
18
Total current assets
Total assets
Equity
Called up share capital
Share premium
Other reserves
Share based payments
Translation reserve
Retained earnings
Total equity attributable to equity holders of the parent
Total equity
Liabilities
Non-current liabilities
Deferred tax liabilities
Other financial liabilities
Total non-current liabilities
Current liabilities
Trade and other payables
Liabilities directly associated with classified as held for resale
Total current liabilities
Total equity and liabilities
19
19
19
20
21
17
18
100
-
168
41
1,206
11,213
93
16,404
187
50
-
7,768
12,728
24,502
298
2,978
16,002
19,278
32,006
6,070
12,053
720
307
(9,617)
17,164
26,697
26,697
-
-
-
1,385
3,924
5,309
4,574
453
-
5,027
29,529
6,054
11,821
720
364
(5,970)
12,298
25,287
25,287
2,273
1,651
3,924
318
-
318
32,006
29,529
The financial statements were approved by the Board of Directors and authorised for issue on 13 July 2021. They were signed on its behalf by:
M J de Villiers
Chairman
A.K.Sener
Managing Director
The accompanying notes form part of these financial statements.
5 0
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Company Statement of Financial Position
For the year ended 31 December 2020
Consolidated Statement of Changes in Equity
For the year ended 31 December 2020
Note
2020
£’000
2019
£’000
7,027
377
1,206
8,610
-
-
-
8,508
365
-
8,873
534
-
534
Share
capital
£’000
Share
premium
£’000
Other
reserves
£’000
Share
based
payments
reserve
£’000
Translation
reserve
£’000
Retained
earnings
£’000
Total
attributable
to equity
holders of
parent
£’000
Changes in equity to
31 December 2019
Balance at 1 January 2019
6,054
11,821
720
250
(4,196)
Profit for the year
Other comprehensive income
Total comprehensive income
Share options
Transactions with owners
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
8,610
9,407
Balance at 31 December 2019
6,054
11,821
720
6,070
12,053
307
(9,826)
8,604
6
6
6,054
11,821
364
(8,838)
9,401
6
6
Changes in equity to
31 December 2020
Profit for the year
Other comprehensive income
Total comprehensive income
Issue of ordinary shares
Share options
Transfer between reserves
Transactions with owners
-
-
-
16
-
-
16
-
-
-
232
-
-
232
-
-
-
-
-
-
-
8,610
9,407
Balance at 31 December 2020
6,070
12,053
720
The accompanying notes form part of these financial statements.
-
(1,774)
(1,774)
-
-
5,315
6,934
49
6,983
-
-
19,964
6,934
(1,725)
5,209
114
114
(5,970)
12,298
25,287
-
4,763
4,763
(3,647)
-
(3,647)
(3,647)
4,763
-
-
-
-
-
-
103
103
1,116
248
46
-
294
(9,617)
17,164
26,697
-
-
-
114
114
364
-
-
-
-
46
(103)
(57)
307
Assets
Non-current assets
Trade and other receivables
Investments in group undertakings
Earn-In advances
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Equity
Called up share capital
Share premium
Share based payments reserve
Retained earnings
Total equity
Liabilities
Current liabilities
Trade and other payables
Total current liabilities
Total equity and liabilities
15
14
13
16
19
19
19
17
The financial statements were approved by the Board of Directors and authorised for issue on 13 July 2021 .
They were signed on its behalf by:
M J de Villiers
Chairman
A.K.Sener
Managing Director
Registered number : 05403426
The accompanying notes form part of these financial statements.
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Company Statement of Changes in Equity
For the year ended 31 December 2020
Consolidated Statement of Cash Flows
For the year ended 31 December 2020
Changes in equity to
31 December 2019
Balance at 1 January 2019
Loss for the year
Other comprehensive income
Total comprehensive income
Share options
Transactions with owners
Balance at 31 December 2019
Changes in equity to
31 December 2020
Loss for the year
Other comprehensive income
Total comprehensive income
Issue of ordinary shares
Share options
Transfer between reserves
Transactions with owners
Share
capital
£’000
Share
premium
£’000
Share
based
payments
reserve
£’000
Retained
earnings
£’000
6,054
11,821
250
(8,010)
Total
£’000
10,115
(828)
-
(828)
-
(828)
(828)
-
-
114
114
(8,838)
9,401
(1.091)
(1,091)
-
-
(1,091)
(1,091)
-
103
103
248
46
-
294
(9,826)
8,604
-
-
-
114
114
364
-
-
-
46
(103)
(57)
307
-
-
-
-
-
-
-
-
-
-
6,054
11,821
-
-
-
16
-
-
16
-
-
-
232
-
-
232
Balance at 31 December 2020
6,070
12,053
Company statement of cash flows
For the year ended 31 December 2020
All bank transactions are undertaken by Ariana Exploration & Development Limited on behalf of Ariana Resources PLC and recharged accordingly.
As such the Company had no cash transactions directly, as was the case in 2019.
The accompanying notes form part of these financial statements.
Cash flows from operating activities
Profit for the year
Adjustments for:
Profit on disposal of subsidiary undertaking, net of tax
(Profit)/loss on disposal of equity securities at FVOCI
(Profit) on disposal of equipment
Depreciation of non-current assets
Write down of intangible exploration assets
Fair value adjustments
Share of profit in Joint Venture
Share based payments charge
Investment income
Income tax expense
Movement in working capital
Decrease in trade and other receivables
Increase in trade and other payables
Cash inflow from operating activities
Taxation paid
Net cash from operating activities
Cash flows from investing activities
Earn-In Advances
Purchase of land, property, plant and equipment
Payments for intangible assets
Proceeds from disposal of equity securities at FVOCI
Proceeds from disposal of equipment
Dividends from Joint Venture
Investment income
Net cash used in investing activities
Cash flows from financing activities
Issue of share capital
Net cash generated from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Exchange adjustment on cash and cash equivalents
Cash and cash equivalents at end of year
The accompanying notes form part of these financial statements.
2020
£’000
2019
£’000
4,763
6,934
-
-
-
20
-
-
(627)
(20)
(53)
20
364
(49)
(6,478)
(7,891)
45
(7)
327
(1,330)
3,056
1,021
2,747
(282)
2,465
(672)
(3)
(262)
-
-
776
7
114
(5)
46
(1,167)
918
253
4
(8)
(4)
-
(12)
(516)
104
55
-
5
(154)
(364)
248
248
-
-
2,559
(368)
453
(34)
2,978
938
(117)
453
5 4
5 5
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements
For the year ended 31 December 2020
1. General Information
Ariana Resources PLC (the “Company”) is a public limited
company incorporated, domiciled and registered in the UK. The
registered number is 05403426 and the registered address is
2nd Floor, Regis House, 45 King William Street, London, EC4R 9AN.
The Company’s shares are listed on the Alternative Investment
Market of the London Stock Exchange. The principal
activities of the Company and its subsidiaries (together the
“Group”) are related to the exploration for and development
of gold and technology-metals, principally in Turkey.
The consolidated financial statements are presented in Pounds
Sterling (£), which is the parent company’s functional and
presentation currency, and all values are rounded to the nearest
thousand except where otherwise indicated. The financial
information has been prepared on the historical cost basis
modified to include revaluation to fair value of certain financial
instruments and the recognition of net assets acquired including
contingent liabilities assumed through business combinations
at their fair value on the acquisition date modified by the
revaluation of certain items, as stated in the accounting policies.
Basis of Preparation
The Group financial statements have been prepared
and approved by the Directors in accordance with
International Financial Reporting Standards as adopted
by the EU (“Adopted IFRSs”) and effective for the Group’s
reporting for the year ended 31 December 2020.
The separate financial statements of the Company are presented
as required by the Companies Act 2006. As permitted by that
Act, the separate financial statements have been prepared
in accordance with IFRS. These financial statements have
been prepared under the historical cost convention (except
for financial assets at FVOCI) and the accounting policies
have been applied consistently throughout the period.
Going Concern
These financial statements have been prepared on the
going concern basis.
The Directors are mindful that there is an ongoing need to
monitor overheads and costs associated with delivering on its
strategy and certain exploration programmes being undertaken
across its portfolio. The Group is not expecting to raise additional
capital at this time, but may do so to support its strategy and
specific activities on occasion. The Group has no bank facilities
and has been meeting its working capital requirements from
cash resources. At the year end the Group had cash and cash
equivalents amounting to £2.953 million (2019: £453,000).
As set out in note 26, subsequent to the year end the Group
partly disposed of its interests in Zenit Madencilik San. ve Tic. A.S.
(“Zenit”) and Pontid Madencilik San. ve Tic. Limited for a gross
consideration before costs and taxation of US$37.75 million.
The Directors have prepared cash flow forecasts for the Group
for the period to 31 July 2022 based on their assessment
of the prospects of the Group’s operations. The cash flow
forecasts include expected future cash flows from our
Joint Venture investment in Zenit along with the normal
operating costs for the Group over the period together with
the discretionary and non-discretionary exploration and
development expenditure. The forecasts indicate that on the
basis of existing cash and other resources, and expected
future dividend payments from Zenit, the Group will have
adequate resources to meet all its expected obligations in
delivering its work programme for the forthcoming year.
The Group believes there should be no significant
material disruption to the mining operations in Zenit
from COVID-19, but the Board continues to monitor
these risks and Zenit’s business continuity plans.
In preparing these financial statements the Directors have
given consideration to the above matters and on this
basis they believe that it remains appropriate to prepare
the financial statements on a going concern basis.
New Accounting Standards & Interpretations
(a) New and amended standards mandatory for the first time for
the financial periods beginning on or after 1 January 2020.
Definition of Material – Amendments to IAS1 and IAS8
Amendments to References to the Conceptual Framework in
IFRS Standards
Amendments to IFRS 3 Business Combinations
The adoption of these new accounting pronouncements has not
had a significant impact on the accounting policies, methods
computation or presentation applied by the Group.
(b) New standards, amendments and Interpretations that have
not been early adopted but effective from 1 January 2022, are as
follows:
Amendments to IAS 1 Presentation of financial statements:
classification of liabilities as current and non-current
Amendments to IFRS 3 amendments Business combinations:
updating a reference to the conceptual framework
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16:
Interest Rate Benchmark Reform – Phase 2
Amendments to IAS 37 Provisions, contingent liabilities and
continent assets: onerous contracts
Amendments to IAS 16 Property, plant and equipment
Annual improvements to IFRS Standards 2018-2020 Cycle
The Group is evaluating the impact of the new and amended
standards above which are not expected to have a material
impact on the Group’s results or shareholders’ funds statements.
Basis of consolidation
The consolidated financial statements comprise the
financial statements of Ariana Resources PLC and its
subsidiaries for the year ended 31 December 2020.
Subsidiaries are all entities over which the Group has power to
direct relevant activities and an exposure to variable returns.
Subsidiaries are fully consolidated from the date on which control
is transferred to the Group. They are de-consolidated from the
date that control ceases. The cost of an acquisition is measured
at fair value of the assets and equity instruments acquired, and
the liabilities incurred or assumed at the date of exchange.
The acquisition of subsidiaries is accounted for using the
purchase method. The cost of acquisition is measured at
the fair values, at the date of exchange, of the assets given,
liabilities incurred or assumed, and equity instruments issued.
The acquirer’s identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS3
are recognised at their fair values at the acquisition date. Where
the Group acquires a subsidiary for less than the fair value of
its assets and liabilities, this results in negative goodwill or
gain on acquisition which is recognised in profit and loss.
If a business combination is achieved in stages, the
acquisition date carrying value of the Group’s previously
held equity interest in the acquiree is remeasured to fair
value at the acquisition date; any gains or losses arising
from such remeasurements are recognised in the income
statement. Where necessary, adjustments are made to the
financial statements to bring the accounting policies used
into line with those used by other members of the Group.
All significant intercompany transactions and balances
between group entities are eliminated on consolidation.
The Group has applied IFRS 11 to all joint arrangements as of
1 January 2015. The Group identifies joint arrangements as
those arrangements in which two or more parties have joint
control, where joint control is evidenced by the contractually
agreed sharing of control of an arrangement, which exists
where the decisions about the relevant activities require
the unanimous consent of the parties sharing control.
Investments in joint arrangements are classified as
either joint operations or joint ventures depending on the
contractual rights and obligations of each investor.
Joint operations are identified as those agreements whereby
the parties have rights to the assets and obligations for
liabilities relating to the arrangement. Joint operations
are accounted for by recognising the operator’s relevant
share of assets, liabilities, revenues and expenses. The
Group currently has no joint operations in existence.
Joint ventures are identified as those agreements whereby
the parties have rights to the net assets of the arrangement
and are accounted for using equity accounting in accordance
with IAS 28. Interest in joint ventures are initially recognised at
cost and adjusted thereafter to recognise the Group’s share of
the post-acquisition profits or losses and movements in other
comprehensive income. When the Group’s share of losses
in a joint venture equals or exceeds its interests in the joint
ventures (which includes any long-term interests that form
part of the Group’s net investment in the joint ventures), the
Group does not recognise further losses, unless it has incurred
obligations or made payments on behalf of the Joint Venture.
An associate is an entity over which the Group is in a position
to exercise significant influence, but not control or joint control,
through participation in the financial and operating policy
decisions of the investee. Significant influence is the power to
participate in the financial and operating policy decisions of the
investee but is not control or joint control over those policies.
The results and assets and liabilities of our investments in
our associates are incorporated in these financial statements
using the equity method of accounting except when classified
as held for sale. Investments in associates are carried in the
Group statement of financial position at cost as adjusted
by post-acquisition changes in the Group’s share of the net
assets of the associates, less any impairment in the value of
individual investments. Losses of the associates in excess of
the Group’s interest in those associates are not recognised.
In the Company accounts, investments in subsidiary
undertakings are held at cost less impairment losses.
Income and expense recognition
The Group’s other income represents consideration received
on the disposal of licences, consultancy fees and interest
receivable from bank deposits. Interest income is accrued
on a time basis, by reference to the principal outstanding
and the effective rate of interest applicable. The effective
interest rate is the rate that exactly discounts estimated
future cash receipts through the expected life of the financial
asset to the net carrying amount of the financial asset.
Operating expenses are recognised in the statement of
comprehensive income upon utilisation of the service or at the
date of their origin and are reported on an accruals basis.
Foreign currency translation
Functional and presentational currency
Items included in the financial statements are measured
using the currency of the primary economic environment
in which the entity operates (the ‘functional currency’). The
consolidated financial statements are presented in Pounds
Sterling, which is the Group’s presentation currency.
Transactions and balances
Foreign currency transactions are translated into the
functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions and
from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are
recognised in the comprehensive income statement.
Group companies
The results and financial position of all the Group entities (none
of which has the currency of a hyperinflationary economy) that
have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
• assets and liabilities for each statement of financial position
presented are translated at the closing rate at the date of that
statement of financial position;
• income and expenses for each income statement are
translated at average exchange rates (unless this average
is not a reasonable approximation of the cumulative effect
of the rates prevailing on the transaction dates, in which
case income and expenses are translated at the dates of the
transaction); and
• all resulting exchange differences are recognised as a
separate component of equity. On consolidation, exchange
differences arising from the translation of monetary items
receivable from foreign subsidiaries for which settlement is
neither planned nor likely to occur in the foreseeable future
are taken to shareholders’ equity. When a foreign operation
is sold, such exchange differences are recognised in the
statement of comprehensive income as part of the gain or
loss on sale.
5 6
5 7
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT
Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
Earnings per share
Basic earnings per share amounts are calculated by dividing
the profit after taxation of the Group by the weighted average
number of shares outstanding during the year.
Land, property, plant and equipment
Land, property, plant and equipment are stated at cost less
accumulated depreciation and any accumulated impairment losses.
Depreciation is charged so as to write off the cost of assets over
their estimated useful lives, using the straight-line method. The
estimated useful lives, residual values and depreciation method
are reviewed at each year end, with the effect of any changes in
estimate accounted for on a prospective basis.
Land
– not depreciated
Computer equipment – between 25% & 33%
Drilling equipment
– between 10% & 20%
Fixtures and fittings
– between 5% & 33%
Motor vehicles
– between 20% & 25%
The gain or loss arising on the disposal or retirement of an item of
property, plant and equipment is determined as the difference
between the sales proceeds and the carrying amount of the asset
and is recognised in the statement of comprehensive income.
Intangible assets
Intangible assets include expenditure on software and databases
acquired to develop the Group’s geological expertise. Assets
within this category that have a finite useful life are amortised
over 20 years.
Intangible exploration assets
Intangible assets represent exploration and evaluation assets
(IFRS 6 assets), being the cost of acquisition by the Group of
rights, licences and know-how. Such expenditure requires the
immediate write-off of exploration and development expenditure
that the Directors do not consider to be supported by the
existence of commercial reserves.
All costs associated with mineral exploration and investments,
are capitalised on a project-by-project basis, pending
determination of the feasibility of the project. Costs incurred
include appropriate technical and administrative expenses but
not general overheads and these assets are not amortised until
technical feasibility and commercial viability is established. If an
exploration project is successful, the related expenditures will be
transferred to mining assets and amortised over the estimated
life of the commercial ore reserves on a unit of production basis.
Where a licence is relinquished or a project abandoned, the
related costs are written off.
The recoverability of all exploration and development costs
is dependent upon the discovery of economically recoverable
reserves, the ability of the Group to obtain necessary financing
to complete the development of reserves and future profitable
production or proceeds from the disposition thereof.
Exploration and evaluation assets shall no longer be classified as
such when the technical feasibility and commercial viability of
extracting mineral resources are demonstrable. When relevant,
such assets shall be assessed for impairment, and any impairment
loss recognised, before reclassification to mine development.
Assets classified as held for sale
Assets are classified as held for sale if their carrying amount will be
recovered primarily through a sale transaction rather than through
continuing use and a sale is considered highly probable. They are
measured at the lower of their carrying value and fair value less
costs to sell. An impairment loss is recognised for any subsequent
write-down of the asset to fair value less costs to sell.
Impairment of tangible and intangible assets
At each balance sheet date, the Group reviews the carrying
amounts of its tangible and intangible assets (except for intangible
exploration assets) to determine whether there is any indication
that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss (if any).
Where it is not possible to estimate the recoverable amount of
an individual asset, the Group estimates the recoverable amount
of the cash-generating unit to which the asset belongs. Where a
reasonable and consistent basis of allocation can be identified,
corporate assets are also allocated to individual cash-generating
units, or otherwise they are allocated to the smallest group of
cash-generating units for which a reasonable and consistent
allocation basis can be identified.
Intangible assets with indefinite useful lives and intangible assets
not yet available for use are tested for impairment annually, and
whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell
and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset for which the
estimates of future cash flows have not been adjusted.
Investment in Group undertakings
The Company’s investments in Group undertakings are carried
at historical cost less any provision for impairment. The
Company’s investments arose from either incorporation of, or
acquisition of subsidiary companies primarily based in Turkey.
As these investments are not amortised, their carrying values
are at risk of impairment. The carrying value of investments is
compared to their recoverable amounts which are assessed with
reference to the discounted cash flow forecasts associated with
these territories.
Financial instruments
Financial assets and financial liabilities are recognised on the
Group’s Statement of Financial Position when the Group becomes
a party to the contractual provisions of the instrument. The Group
derecognises a financial asset only when the contractual rights to
cash flows from the asset expire, or it transfers the financial asset
and substantially all the risks and rewards of ownership of the
asset to another entity. If the Group neither transfers nor retains
substantially all the risks and rewards of ownership and continues
to control the transferred asset, the Group recognises its retained
interest in the asset and an associated liability for the amount it
may have to pay. If the Group retains substantially all the risks and
rewards of ownership of a transferred financial asset, the Group
continues to recognise the financial asset and also recognises a
collateralised borrowing for the proceeds received.
The Group derecognises financial liabilities when the Group’s
obligations are discharged, cancelled or expired.
Financial Assets
Trade and other receivables
Trade and other receivables are measured at initial recognition
at fair value, and are subsequently measured at amortised
cost less any provision for impairment. The Group applies the
IFRS 9 simplified approach to providing for expected credit
losses in accordance with applicable guidance for non-banking
entities. Under the simplified approach the Group is required to
measure lifetime expected credit losses for all trade receivables.
No credit losses have been identified during the period.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and on-
demand deposits and other short-term highly liquid investments
that are readily convertible to a known amount of cash with
three months or less remaining to maturity and are subject to an
insignificant risk of changes in value.
Financial liabilities and equity instruments
Financial liabilities and equity instruments are classified according
to the substance of the contractual arrangements entered into.
Equity instruments
Financial instruments issued by the Company are treated as equity
only to the extent that they meet the following two conditions:
• they include no contractual obligations upon the
Company to deliver cash or other financial assets or
to exchange financial assets or financial liabilities
with another party under conditions that are
potentially unfavourable to the Company; and
• where the instrument will or may be settled in the
Company’s own equity instruments, it is either a non-
derivative that includes no obligation to deliver a variable
number of the Company’s own equity instruments
or is a derivative that will be settled by the Company
exchanging a fixed amount of cash or other financial
assets for a fixed number of its own equity instruments.
To the extent that this definition is not met, the proceeds
of issue are classified as a financial liability. Where the
instrument so classified takes the legal form of the Company’s
own shares, the amounts presented in these financial
statements for called up share capital and share premium
account exclude amounts in relation to those shares.
Financial liabilities are classified as measured at amortised
cost or FVTPL. A financial liability is classified as at FVTPL if it is
classified as held-for-trading, it is a derivative or it is designated
as such on initial recognition. Financial liabilities at FVTPL are
measured at fair value and net gains and losses, including any
interest expense, are recognised in profit or loss. Other financial
liabilities are subsequently measured at amortised cost using
the effective interest method. Interest expense and foreign
exchange gains and losses are recognised in profit or loss. Any
gain or loss on derecognition is also recognised in profit or loss.
Share-based payments
For grants of share options, the fair value as at the date of grant
is calculated using the Black-Scholes option pricing model,
taking into account the terms and conditions upon which the
options were granted. The amount recognised as an expense
is adjusted to reflect the actual number of share options that
are likely to vest, except where forfeiture is only due to market
based conditions not achieving the threshold for vesting. Where
shares are issued in settlement of goods or services supplied,
the relevant expense is recorded in the consolidated statement
of comprehensive income, with the related share issue recorded
within share capital and share premium.
Provisions
Provisions are liabilities where the exact timing and amount
of the obligation is uncertain. Provisions are recognised when
the Group has a present obligation (legal or constructive)
as a result of past events, when an outflow of resources
is probable to settle the obligation and when an amount
can be reliably estimated. Where the time value of money
is material, provisions are discounted to current values
using appropriate rates of interest. The unwinding of any
discount is recorded in net finance income or expense.
Taxation
Current income tax assets and liabilities comprise those
obligations to, or claims from, fiscal authorities relating to
the current or prior reporting year, that are unpaid at 31
December 2020. They are calculated according to the tax
rates and tax laws applicable to the fiscal periods to which
they relate, based on the taxable profit for the year.
Deferred income taxes are calculated using the liability method on
temporary differences. Deferred tax is generally provided on the
difference between the carrying amounts of assets and liabilities
and their tax bases. However, deferred tax is not provided on
the initial recognition of goodwill or on the initial recognition of
an asset or liability unless the related transaction is a business
combination or affects tax or accounting profit. Deferred tax on
temporary differences associated with shares in subsidiaries is
not provided if reversal of these temporary differences can be
controlled by the Group and it is probable that reversal will not
occur in the foreseeable future. In addition tax losses available
to be carried forward as well as other income tax credits to the
Group are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting.
Deferred tax assets are recognised to the extent that it is
probable that the underlying deductible temporary differences
will be able to be offset against future taxable income. Current
and deferred tax assets and liabilities are calculated at tax
rates that are expected to apply to their respective period of
realisation, provided they are enacted or substantively enacted
as at 31 December 2020. Changes in deferred tax assets or
liabilities are recognised as a component of tax expense in
the consolidated statement of comprehensive income, except
where they relate to items that are charged or credited directly
to equity in which case the related deferred tax is also charged
or credited to equity. The deferred tax asset arising from
trading losses carried forward as referred to in Note 8 has not
been recognised. The deferred tax asset will be recognised
when it is more likely than not that it will be recoverable.
Segmental reporting
Operating segments are reported in a manner consistent with
the internal reporting provided to the Board of Directors who
have been identified as responsible for allocating resources
and assessing performance of the operating segments,
and who act as the Chief Operating Decision Maker.
5 8
5 9
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT
Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
Accounting judgements
The following are the critical judgements, apart from
those involving estimations, that the Directors have
made in the process of applying the Group’s accounting
policies and that have the most significant effect on the
amounts recognised in the financial statements.
Accounting for Joint Venture
Management have reviewed the criteria of IFRS 11 and made
a judgement that despite its 50% shareholding, Zenit is a
Joint Venture rather than a subsidiary due to the contractual
agreement to share control of that company. The Group
accounts for its Joint Venture with Proccea in Zenit using
the equity method in accordance with IAS 28 (revised).
Intangible exploration assets
Determining whether intangible exploration assets are impaired
requires an assessment of whether there are any indicators
of impairment, by reference to specific impairment indicators
prescribed in IFRS 6. This includes the assessment, on a project
by project basis, of the likely recovery of the cost of the Group’s
Intangible exploration assets in the light of future production
opportunities based upon ongoing geological studies. This also
involves the assessment of the period for which the entity has
the right to explore in the specific area, or if it has expired during
the period or will expire in the near future if it is not expected to
be renewed.
The Group determines that exploration costs are capitalised at
the point the Group has a valid exploration licence or is in the
process of renewal.
Impairment of assets, excluding intangible exploration assets
The Group assesses impairment at each reporting date on a
project by project basis by evaluating conditions specific to
the Group that may indicate an impairment of assets. Where
indicators of impairment exist, the recoverable amount of the
asset is determined based on value in use or fair value less cost
to sell, both of which require the Group to make estimates.
2. Staff costs
4. Other gains
Wages and salaries
Social security costs
Share based payments
(option scheme)
Pension contributions
Group
Company
2020
£’000
2019
£’000
2020
£’000
2019
£’000
434
123
46
43
305
36
114
35
367
116
35
41
288
32
85
33
646
490
559
438
Total staff costs, including those capitalised within
intangible assets, amounts to £658,000 (2019: £771,000).
The average monthly number of employees (including
the Executive Director) during the year was as follows:
Exploration activities
Administration
2020
Group
Number
2019
Group
Number
14
5
19
12
5
17
The only employees within the Company were the Directors.
3. Directors’ emoluments
Short term incentives
Basic salary and fees
Pension contributions
2020
£’000
2019
£’000
367
41
408
342
33
375
Key management personnel consist of only the Directors. Details
of share options and interests in the Company’s shares of each
Director are highlighted in the Directors’ Report on page 40.
Michael de Villiers
Kerim Sener
William Payne
Year
2020
2019
2020
2019
2020
2019
Christopher Sangster
2020
2019
Salary & fees
£’000
Pension
£’000
Total
£’000
125
132
162
115
40
40
60
55
13
10
23
23
-
-
6
1
138
142
185
138
40
40
66
56
William Payne’s services are provided by a firm of Accountants,
further details of which are set out in Note 25.
During the prior year, the Group entered into a sale agreement to dispose of its 99%-owned subsidiary, Çamyol Gayrimenkul, Madencilik,
Turizm, Tarim ve Hayvancilik Ltd (“Camyol”). Camyol carried out a significant part of the Group’s land purchases prior to the commencement
of construction of the Kiziltepe Mine.
The disposal was effected in order that all freehold land pertaining to the Kiziltepe Mine is owned directly by the operating company.
(a) Profit on disposal of land owning operations and subsidiary
Trading loss on operations for the year
Translation reserve transferred to statement of comprehensive income
Exchange loss on revaluation of Intercompany loan
Profit on disposal of subsidiary (4b)
(b) Profit on disposal of subsidiary
At the time of the disposal of the Group’s subsidiary, Camyol, the carrying amount of its assets and liabilities were
as follows:
Non- current assets
Land
Current assets
Trade receivables
Cash at bank
Current liabilities
Trade payables
Net assets derecognised
Consideration receivable on disposal
Profit on disposal of subsidiary
5. Operating loss
The operating loss is stated after charging/ (crediting):
Depreciation and amortisation – owned assets
Other income – disposal of drilling equipment and other miscellaneous income.
Write down of Intangible exploration assets
Office lease rentals
Net foreign exchange (gains)/ losses
Fees payable to the Company’s auditor for the audit of the Group’s and Company’s annual accounts
Fees payable to the Company’s auditor for other services:
– The audit of the Company’s subsidiaries
2020
£’000
2019
£’000
-
-
-
-
-
(1)
23
(217)
822
627
2020
£’000
2019
£’000
-
-
-
-
-
-
-
119
1
4
(115)
9
831
822
2020
£’000
2019
£’000
19
-
-
13
(502)
50
21
20
(61)
364
-
144
50
20
6 0
6 1
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
6. Share of profit of interest in Joint Venture
6. Share of profit of interest in Joint Venture continued
In July 2010 the Group entered into an agreement with Proccea Construction Co. (“Proccea”) such that Galata Madencilik San. ve Tic.
Ltd. (“Galata”) would transfer its principal assets at Kiziltepe and Tavşan, collectively known as the “Red Rabbit Gold Project” into a
wholly owned subsidiary, Zenit Madencilik San. ve Tic. A.S. (“Zenit”). Proccea earned their 50% share in Zenit by investing US$8 million
in the capital of Zenit, US$1.4 million of such funds having been spent on a Feasibility Study and an Environmental Impact Assessment
(“EIA”), with the balance on initial mine construction, once the Feasibility Study and EIA were completed satisfactorily. Shareholdings in
Zenit represents the ratio of 50% the Group and 50% to Proccea, with Proccea in management control, but with key decisions requiring
approval from both the Group and Proccea.
Zenit entered production during March 2017, with commercial production declared from 1 July 2017. Operational revenues and costs
arising from pre-commercial production were capitalised in 2017 along with any new capital expenditure incurred during 2018 including
the construction of the district road diversion necessary for the full development of the Arzu South open pit. Total revenue for the year
was c. US$37.5 million (2019: US$45.1 million) in gold and silver sales.
The liability of the Joint Venture includes current and non-current portions of a bank loan repayable to Turkiye Finans Katilim Bankasi A.S.
and Garanti Bankasi A.S.. Management does not foresee any significant restrictions on the ability of the Joint Venture to repay these loans.
The Group accounts for its Joint Venture with Proccea in Zenit using the equity method in accordance with IAS 28 (revised). At 31
December 2020 the Group has a 50% (2019: 50%) interest in Zenit. Ultimately profits from Zenit are shared in the ratio of 50:50 between
Group and Proccea.
Statement of financial position
As at 31 December 2020
Assets
Non-current assets
Other receivables and deferred tax asset
Intangible exploration assets
Kiziltepe Gold Mine (including capitalised mining costs, land, property, plant and equipment)
Total non-current assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Principal place of business for Zenit is Ankara, Turkey. Zenit was also incorporated in Ankara, Turkey.
Other receivables, VAT and prepayments
Financial information of the Joint Venture, based on its translated financial statements, and reconciliations with the carrying amount of
the investment in the consolidated financial statements are set out below:
Statement of Comprehensive Income
For the year ended 31 December 2020
Revenue
Cost of sales
Gross Profit
Administrative expenses
Operating profit
Finance expenses including foreign exchange losses
Finance income including foreign exchange gains
Profit before tax
Taxation charge
Profit for the year
Proportion of the Group’s profit share
Group's share of profit for the year
2020
£’000
2019
£’000
29,145
35,337
(13,335)
(15,444)
15,810
(1,750)
14,060
(3,143)
2,262
13,179
(223)
19,893
(1,636)
18,257
(4,762)
2,667
16,162
(380)
12,956
15,782
50%
6,478
50%
7,891
Total current assets
Total assets
Liabilities
Non-current liabilities
Borrowings
Asset retirement obligation
Total non-current liabilities
Current liabilities
Borrowings
Trade payables
Other payables
Total current liabilities
Total liabilities
Equity
Proportion of the Group’s profit share
Carrying amount of investment in Joint Venture
Movement in Equity – our share
Opening balance
Profit for the year
Translation and other reserves
Dividend receivable
Closing balance
2020
£’000
2019
£’000
1,244
670
440
837
18,817
23,275
20,731
24,552
8,031
286
2,598
2,004
7,184
752
1,745
2,187
12,919
11,868
33,650
36,420
2,126
924
3,050
4,881
1,544
1,749
8,174
11,224
22,426
50%
11,213
7,768
6,478
(2,257)
(776)
11,213
3,241
1,000
4,241
5,776
1,883
8,984
16,643
20,884
15,536
50%
7,768
3,968
7,891
(1,049)
(3,042)
7,768
6 2
6 3
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
7. Segmental analysis
8. Taxation
Management currently identifies one division as an operating segment – mineral exploration. This operating segment is monitored
and strategic decisions are made based upon this and other non-financial data collated from exploration activities.
Principal activities for this operating segment are as follows:
• Mining - incorporates the acquisition, exploration and development of mineral resources.
(a) Current tax expense in respect of the current year
• Reconciling items include non-mineral exploration costs and transactions between Group and associate companies.
The charge for the year can be reconciled to the profit per the statement of comprehensive income as follows:
Administrative costs
General and specific exploration expenditure
Profit/(loss) on disposal of investments
Other gains
Share of profit in Joint Venture
Investment and other income
Profit before taxation
Taxation
Profit after taxation
Assets
Segment assets
Liabilities
Segment liabilities
Additions to segment assets
Intangible assets
Property, plant & equipment
Depreciation and amortisation
Geographical segments
2020
Other
reconciling
items
£’000
2019
Other
reconciling
items
£’000
Group
£’000
Group
£’000
Mining
£’000
(1,360)
(1,360)
-
(1,242)
(1,242)
-
-
-
-
7
(35)
(382)
-
-
-
627
6,478
7,891
7
-
-
20
-
-
66
(382)
20
627
7,891
66
Mining
£’000
-
(35)
-
-
6,478
-
6,443
(1,353)
5,090
8,136
(1,156)
6,980
(43)
(284)
(327)
(43)
(3)
(46)
6,400
(1,637)
4,763
8,093
(1,159)
6,934
Profit before tax – continuing operations
Profit multiplied by the standard rate of corporation tax in the UK of 19% (2019:19%)
Effect of tax on share of Joint Venture profit
Disallowable expenses and other adjustments
Exempt gain on disposal of subsidiary
Withholding tax suffered on subsidiary dividend
Effect of different tax rates and laws of subsidiaries operating in other jurisdictions
Losses for the year to carry forward
Tax charge
The Group has UK losses carried forward on which no deferred tax asset is recognised in the financial statements as the recovery of this
benefit is dependent on future profitability, the timing of which cannot be reasonably foreseen. Total UK losses carried forward amount to
£10,393,000 (2019: £9,313,000), and non-UK losses amount to £306,000 (2019: £169,000).
29,937
2,069
32,006
28,706
823
29,529
No deferred tax assets had been recognised against the Group’s and Company’s tax losses as the entities have not had sufficient taxable
temporary differences in the year against which the losses could be utilised.
(5,056)
(253)
(5,309)
(4,003)
(239)
(4,242)
9. Loss of parent company
263
19
-
-
-
(19)
263
19
(19)
516
32
-
-
-
(20)
516
32
(20)
As permitted by Section 408 of the Companies Act 2006, the statement of comprehensive income of the parent Company is not
presented as part of these financial statements. The parent Company’s loss for the financial year was £1,091,000 (2019: £828,000).
10. Earnings per share on continuing operations
The calculation of basic profit per share is based on the profit attributable to ordinary shareholders of £4,763,000 (2019: £6,934,000)
divided by the weighted average number of shares in issue during the year being 1,062,538,317 shares (2019: 1,059,677,953). There is no
material effect on the basic earnings per share for the dilution provided by the share options.
2020
£’000
327
2020
£’000
5,090
967
2019
£’000
46
2019
£’000
6,980
1,326
(1,235)
(1,499)
11
-
284
16
284
327
23
(137)
-
108
225
46
The Group’s mining assets and liabilities are located primarily in Turkey.
Carrying amount of segment non-current assets
2020
United
Kingdom
£’000
Group
£’000
Turkey
£’000
2019
United
Kingdom
£’000
Group
£’000
1,375
12,728
24,314
188
24,502
Turkey
£’000
11,353
6 4
6 5
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
11a. Intangible exploration assets
12. Land, property, plant & equipment
Deferred exploration
expenditure
£’000
Land
£’000
Computer
equipment
£’000
Drilling
equipment
£’000
Fixtures &
fittings
£’000
Motor
vehicles
£’000
Totals
£’000
Cost
At 1 January 2019
Additions and capitalised depreciation
Reclassification of expenditure
Exchange movements
Expenditure written off
At 31 December 2019
Additions and capitalised depreciation
Exchange movements
Expenditure reclassified to assets held for sale (note 18)
At 31 December 2020
Net book value
At 1 January 2019
At 31 December 2019
At 31 December 2020
16,975
516
(206)
(517)
(364)
16,404
263
(665)
(16,002)
-
16,975
16,404
-
None of the Group’s intangible assets are owned by the Company.
The technical feasibility and commercial viability of extracting a mineral resource are not yet fully demonstrable in the above intangible
exploration assets. These assets are not amortised, until technical feasibility and commercial viability is established. Intangible exploration
costs written off represent costs relating to certain projects that are no longer considered economically viable or where exploration
licences have been relinquished.
11b. Intangible assets
Cost or Valuation
At 1 January 2020
Amortisation charge
At 31 December 2020
Net book value
At 1 January 2020
At 31 December 2020
Software and
Database
expenditure
£’000
187
(19)
168
187
168
Cost
At 1 January 2019
Additions
Disposals
Exchange movements
At 31 December 2019
Additions
Exchange movements
At 31 December 2020
At 31 December 2019
Depreciation
At 1 January 2019
Charge
Disposals
Exchange movements
At 31 December 2019
Charge
Exchange movements
At 31 December 2020
Net book value
At 1 January 2019
At 31 December 2019
At 31 December 2020
138
(119)
(19)
-
-
-
-
-
-
-
-
-
-
-
-
138
-
-
47
2
-
(15)
34
6
(6)
34
33
5
-
(8)
30
5
(5)
30
14
4
4
251
26
(87)
(164)
26
-
(6)
20
158
5
(85)
(72)
6
4
(1)
9
93
20
11
45
4
-
(15)
34
1
(7)
28
35
4
-
(16)
23
4
(5)
22
10
11
6
39
-
-
(5)
34
12
(7)
39
16
5
-
(2)
19
4
(4)
19
23
15
20
520
32
(206)
(218)
128
19
(26)
121
242
19
(85)
(98)
78
17
(15)
80
278
50
41
Of the total depreciation expense, £16,000 has been capitalised to intangible exploration assets (2019: £18,000).
6 6
6 7
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
13. Earn-In Advances
Group and Company
At 1 January 2020
Reclassification from debtors – prior year
Advances paid during the year
At 31 December 2020
Net book value
At 31 December 2019
At 31 December 2020
Group and Company
2020
£’000
-
534
672
1,206
-
1,206
Ariana Resources PLC is to acquire up to 50% of Venus Minerals Ltd through an earn-in agreement. Investment rights continue to accrue as at
31 December 2020 on earn-in payments to date amounting to £1,206,000 (2019: £534,000). It is expected that Ariana Resources PLC will have
acquired 50% of Venus Minerals Ltd during 2021, following further earn-in payments amounting to approximately £1,600,000.
14. Investments in Group undertakings continued
Ariana Exploration & Development Limited’s investments at the balance sheet date comprise the following companies:
Subsidiaries
Ownership
Country of
incorporation
Nature
of business
Address
Greater Pontides Exploration B.V.
100%
Netherlands
Holding
company
Herengracht 500,
1017 CB Amsterdam, Netherlands
Pontid Madencilik San. ve Tic. Ltd.
100%
Turkey
Exploration
Hilal Mahallesi, Konrad Adenauer Cd.
15A, 06550 Çankaya, Ankara, Turkey
Asgard Metals Pty. Ltd.
100%
Australia
Western Tethyan Resources Ltd
100%
United Kingdom
Exploration/
Investment
10 Wygonda Rd,
Roleystone WA 6111, Australia
Holding
company
2nd Floor, Regis House, 45 King William Street
London, EC4R 9AN
Kosovo Mineral Resources LLC
100% Republic of Kosovo
Exploration
Rr Ali Vitia Kalabri Bll. A-Lam-B. Nr.19
Prishtine, Kosova
14. Investments in Group undertakings
15. Non-current trade and other receivables
Company
At 1 January 2020
Additions
At 31 December 2020
Shares in Group undertakings
£’000
365
11
376
The Company’s investments at the balance sheet date comprise ownership of the ordinary share capital of the following companies:
Amounts owed by Group undertakings
Other receivables
Group
Company
2020
£’000
2019
£’000
-
100
100
-
93
93
2020
£’000
7,027
-
2019
£’000
8,508
-
7,027
8,508
Other receivables falling due after more than one year represent amounts due from the government of Turkey in respect of VAT relating to
the Group’s exploration projects. The amounts owed to the Company by Group undertakings are interest free and repayable on demand.
Subsidiaries
Ownership
Country of
incorporation
Nature
of business
Address
16. Trade and other receivables
Ariana Exploration &
Development Limited
100%
United Kingdom
Exploration
2nd Floor, Regis House, 45 King William Street
London, EC4R 9AN
Portswood Resources Limited
100%
British
Virgin Islands
Holding
company
Kingston Chambers P.O. Box 173
Road Town, Tortola, British Virgin Islands
Galata Madencilik San. ve Tic. Ltd.
100%
Turkey
Exploration
Çankaya Mah. Farabi Sok. 7/5 Çankaya,
Ankara, Turkey
Amounts owed by Joint Venture Company
Other receivables
Earn-In advances reclassified to Non-current assets (see note 13)
Prepayments
Group
Company
2020
£’000
-
183
-
115
298
2019
£’000
3,383
598
534
59
4,574
2020
£’000
2019
£’000
-
-
-
-
-
-
-
534
-
534
The carrying values of other receivables approximate their fair values because these balances are expected to be cash settled in the
near future.
6 8
6 9
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
17. Trade and other payables
19. Called up share capital and premium continued
Trade and other payables
Social security and other taxes
Other creditors and advances
Accruals and deferred income
Group
Company
2020
£’000
147
14
1,099
125
1,385
2019
£’000
2020
£’000
2019
£’000
109
66
7
136
318
-
-
-
6
6
-
-
-
6
6
Fully paid Ordinary Shares carry one vote per share and carry the right to dividends. Deferred Shares have attached to them the following
rights and restrictions:
• they do not entitle the holders to receive any dividends and distributions;
• they do not entitle the holders to receive notice or to attend or vote at General Meetings of the Company;
on return of capital on a winding up the holders of the Deferred Shares are only entitled to receive the amount
paid up on such shares after the holders of the Ordinary Shares have received the sum of 0.1p for each ordinary
share held by them and do not have any other right to participate in the assets of the Company.
Potential issue of ordinary shares
Share options
The above listed payables are all unsecured. Due to the short-term nature of current payables, their carrying values approximate their
fair value.
The Company issued 64,000,000 new options to Directors and staff at an exercise price of 1.55 pence, vesting over 3 years, commencing
on 1 January 2018. At 31 December 2020 the Company had options outstanding for the issue of ordinary shares as follows:
18. Assets and liabilities classified as held for sale
Date options
granted
Exercisable from
Exercisable
to
Exercise
price
Number
granted
Options exercised
during the year
Number at
31 December 2020
Assets classified as held for sale
Intangible Exploration assets
Total assets of group held for sale
Liabilities directly associated with assets classified as held for sale
Deferred tax liabilities
Contingent consideration payable
Total liabilities of group held for sale
Group
Company
1 January 2018
1 January 2018
31 December 2023
1.55p
64,000,000
(16,000,000)
48,000,000
2020
£’000
2019
£’000
2020
£’000
2019
£’000
Total
64,000,000
(16,000,000)
48,000,000
The fair value of services received in return for share options are measured by reference to the fair value of share options granted. The fair
value of employee share options is measured using the Black-Scholes model. Measurement inputs and assumptions are as follows:
16,002
16,002
2.273
1,651
3,924
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Costs associated with options issued on the 1 January 2018 and exercisable by 2023
Share price when options issued
Expected volatility (based on closing prices over the last 7 years)
Expected life
Risk free rate
Expected dividends
1.25p
67.84%
5 years
0.75%
0%
The above assets and liabilities held for sale were reclassified from non-current assets and non-current liabilities due to the Group
concluding the disposal, since the year end, of its interests in its Salinbas and all other exploration projects, held through its subsidiary
companies based in Turkey. Further details are disclosed in note 26.
19. Called up share capital and premium
Allotted, issued and fully paid ordinary 0.1p shares
Number
Ordinary
Shares
£’000
Deferred
shares
£’000
Called up
Share capital
£’000
Share
Premium
£’000
In issue at 1 January 2020
Share options exercised
In issue at 31 December 2020
1,059,677,943
16,000,000
1,075,677,943
1,059
16
1,075
4,995
-
4,995
6,054
16
11,821
232
6,070
12,053
During 2013 the existing ordinary shares were sub-divided into one new ordinary share of 0.1 pence (“New Ordinary Share”) and one
deferred share of 0.9 pence (“Deferred Share”). The New Ordinary Shares have a nominal value of 0.1 pence. The percentage of New
Ordinary Shares held by each shareholder following the subdivision is the same as the percentage of existing ordinary shares held by the
shareholder before the change.
The expected volatility is wholly based on the historic volatility (calculated based on the weighted average of the last 7 years of quotation).
Share based payments reserve
At 1 January 2020
Charge during the year
Transfer to retained earnings for options exercised during the year
At 31 December 2020
Group and Company
2020
£’000
364
46
(103)
307
As set out in note 2 the Group recognised an expense of £46,000 (2019: £114,000) relating to equity share based payment transactions in
the year.
7 0
7 1
FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT
Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
20. Deferred tax liabilities
25. Related party transactions
Opening and closing deferred tax liability
Group
Company
2020
£’000
-
2019
£’000
2,273
2020
£’000
-
2019
£’000
-
Group companies
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation.
Ariana Resources PLC is the beneficial owner and controls, or is in joint venture with, the following companies and as such are considered
related parties:
Deferred tax has been provided against the fair value uplift of intangible exploration assets that resulted from a previous business
combination. This liability has been reclassified under liabilities directly associated with assets held for sale, as set out in note 18.
21. Other financial liabilities
Contingent consideration payable
Group
Company
2020
£’000
-
2019
£’000
1,651
2020
£’000
-
2019
£’000
-
Ariana Exploration & Development Ltd.
Portswood Resources Ltd.
Galata Madencilik San. ve Tic. Ltd.
Zenit Madencilik San. ve Tic. A.S. (Joint Venture)
Asgard Metals Pty. Ltd.
Greater Pontides Exploration B.V.
Pontid Madencilik San. ve Tic. Ltd.
Western Tethyan Resources Ltd.
Kosovo Minerals Resources LLC.
The consideration above relates to a 2% net smelter returns royalty on the future production revenue at Salinbaş. This liability arose as a
result of the business combination as noted in note 20. This liability has been reclassified under liabilities directly associated with assets
held for sale, as set out in note 18.
22. Operating lease arrangements
Management have completed a detailed assessment of existing operating contracts and have not identified any contracts requiring adjustment
on the adoption of IFRS 16 as the operating leases held by the Group are of low value and short-term in nature.
The only transactions during the year between the Company and its subsidiaries were as follows:
Loan payable by Ariana Exploration & Development Limited to Ariana Resources PLC amounted to £7,027,310 (2019: £8,508,203).
Loan payable by the Group’s recently formed wholly owned subsidiary Kosovo Minerals Resources LLC to Ariana Exploration &
Development Limited amounted to £30,000.
William Payne is a partner in Azets (previously Wilkins Kennedy), a firm of Accountants that provides his services. During the year end
31 December 2020, Azets were paid £40,000 (2019: £40,000) in respect of his services as a Director, and £119,775 (2019: £101,500) in
respect of accounting and management services. Fees paid for William Payne’s services are included as part of Directors emoluments
declared in Note 3. At the year end the Group owed Azets £25,105 (2019: £40,451).
At the year end, the Group had outstanding short term commitments for future minimum lease payments under non-cancellable operating
leases, which fall due as follows:
Independent Executive Consultants Limited, a company jointly controlled by Michael de Villiers, charged the Company £Nil (2019:
£37,000) in respect of his services as a Director. This remuneration for the prior year is included as part of his emoluments in note 3.
Within one year
23. Capital commitments
2020
16
2019
16
The Group had no authorised or unauthorised capital commitments at the year end (2019: £nil).
24. Contingent liabilities
Following the disposal of the Group’s 99%-owned subsidiary, Çamyol Gayrimenkul, Madencilik, Turizm, Tarim ve Hayvancilik Ltd
(“Camyol”) 75% of the resulting gain on disposal is exempt from Turkish corporation tax provided the gain is retained under equity by
Galata Madencilik San. ve Tic. Ltd. for a period of 5 years. This potentially exempt taxable gain amounts to Turkish Lira 4,529,343 with an
associated corporation tax liability of Turkish Lira 996,455, or approximately £99,000 (2019: £137,000).
At 31 December 2020, Kerim Sener had received £63,455 or TL 581,357 (2019: £109,583 or TL795,621) from Zenit Madencilik San. ve Tic.
A.S. for his services as a Director of the joint venture subsidiary, in accordance with the Turkish Commercial Code and an Extraordinary
General Meeting resolution dated 1 November 2018. This remuneration is in addition to his emoluments disclosed in note 3.
Kerim Sener was appointed a Director of Venus Minerals Ltd (“Venus”) on 13 August 2019 and continues to receive no remuneration
during the period to 31 December 2020. Venus is focused on the exploration and development of copper and gold on the island of Cyprus.
Transactions with Venus during the year and additional disclosures are set out on note 13.
Joint Venture company
Loans including unpaid dividends payable on demand by Zenit Madencilik San. ve Tic. A.S. to Galata Madencilik San. ve Tic. Ltd. amounted
to £Nil (2019: £3,383,297).
26. Post year end events
In February 2021 the Group concluded the disposal of its interests in Salinbaş held through its subsidiary company Pontid Madencilik
San ve Tic. Ltd to Zenit, and the subsequent disposal of 53% of its existing shareholding in Zenit to Özaltin Holding A.S. for an overall
consideration of US$35.75 million before costs and taxation, retaining a 23.5% interest in the ongoing joint venture. A further US$2 million
is to be paid in instalments to the Group by Zenit following the transfer of three remaining Satellite Projects by Galata Madenicilik San. ve
Tic. Ltd. to Zenit.
In June 2021 the Company was successful in its application to the Court for permission to reduce its share capital via the cancellation of
its share premium account and historical deferred shares in issue.
7 2
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
27. Capital management policies and procedures
The Group’s capital management objectives are:
• To ensure the Group’s ability to continue as a going concern;
• To increase the value of the assets of the business; and
• To provide an adequate return to shareholders in the future when exploration assets are taken into production.
These objectives will be achieved by identifying the right exploration projects, adding value to these projects and ultimately taking them
through to production and cash flow, either with partners or by our own means.
The Group monitors capital on the basis of the carrying amount of equity, cash and cash equivalents as presented on the face of the
consolidated statement of financial position. Movements in capital for the year under review are summarised in Note 18 and in the
consolidated statement of changes in equity.
The Group manages its capital structure in response to changes in economic conditions and in accordance with the Group’s objective to
finance additional work on existing and new projects to enhance their overall value.
In the normal course of its operations, the Group and Company are exposed to gold prices, currency, interest rate and liquidity risk.
The Group and Company use financial instruments, other than derivatives, comprising short term deposits, cash, liquid resources and
various items such as sundry debtors and creditors that arise directly from its operations. The main purpose of these financial instruments
is to finance the Group’s operations.
The main risks arising from the Group’s and Company’s financial instruments are liquidity and currency differences on foreign currency net
investments. The Directors review and agree policies for managing these risks and these are summarised below.
Liquidity risk
Liquidity risk is the risk that the Group and Company will not be able to meet their financial obligations as they fall due.
The Group and Company seek to manage financial risk to ensure sufficient liquidity is available to meet foreseeable needs and to invest
cash assets safely and profitably. The Board will seek additional funds from the issue of share capital where appropriate, by reviewing
financial and operational budgets and forecasts. The Group and Company’s financial liabilities, including interest bearing liabilities and
trade and other payables will all be settled within six months of the year end with the exception of the contingent consideration payable
which is not expected to become payable for a period beyond 5 years.
Credit risk
Credit risk is the risk of financial loss to the Group and Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations. The Group and Company have borrowings outstanding from its subsidiaries and joint ventures, the ultimate
realisation of which depends on the successful exploration and realisation of the Group’s intangible exploration assets:
Trade and other receivables (current and excluding prepayments)
Trade and other receivables (non-current)
Group
Company
2020
£’000
183
100
283
2019
£’000
3,981
93
4,074
2020
£’000
-
7,027
7,027
The concentration of credit risk for trade and other receivables at the balance sheet date by geographic region was:
Group
Company
United Kingdom
Turkey
Other
2020
£’000
32
251
-
283
2019
£’000
520
3,552
2
4,074
2020
£’000
7,027
-
-
7,027
9,042
2019
£’000
534
8,508
9,024
2019
£’000
9,042
-
-
27. Capital management policies and procedures continued
Market risk
Foreign exchange risk arises due to the Group’s and Company’s primary operations being in Turkey. The Group and Company have a
general policy of not hedging against its exposure of foreign investments in foreign currencies. The Group and Company are exposed to
translation and transaction foreign exchange risks and take profits or losses on these as they arise.
GBP
Turkish Lira
Other
Total
Group
Cash and cash equivalents
Trade and other receivables
Trade and other payables
2020
£’000
2019
£’000
2020
£’000
597
129
263
48
1,113
241
2,117
162
932
2019
£’000
157
3,459
70
2020
£’000
264
7
200
2019
£’000
248
2
7
2020
£’000
2,978
298
1,395
2019
£’000
453
4,574
318
GBP
Turkish Lira
Other
Total
Company
2020
£’000
2019
£’000
2020
£’000
2019
£’000
2020
£’000
2019
£’000
2020
£’000
2019
£’000
Cash and cash equivalents
-
-
Trade and other receivables
7,027
9,042
Trade and other payables
6
6
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,027
9,024
6
6
Sensitivity analysis
Foreign exchange risk arises due to the Group’s and Company’s primary operations being in Turkey.
A 10% percent weakening of Turkish Lira against the Sterling at the reporting date would have decreased net assets by £1,296,000. This
calculation assumes that the change occurred at the balance sheet date and had been applied to risk exposures existing at that date.
Market risk - Borrowing facilities and interest rate risk
The Group and Company finances its operations primarily through its share of profits from its joint venture investment, and the issue of equity
share capital to ensure sufficient cash resources are maintained to meet short-term liabilities and future project development requirements.
Cash deposits are kept under regular review, with reference to future expenditure requirements and to maximise interest receivable.
Sensitivity analysis
(a) The Group and Company have limited exposure to changes to interest rates both locally and in Turkey since the interest accruing on
bank deposits was relatively immaterial.
(b) The Group and Company have no interest rate exposure on the loan finance provided during the year as the amounts owed by Group
undertakings are interest free.
Market risk – Equity price risk
The Group and Company’s exposure to equity price risk arose from its investment in equity securities which ceased during the prior year.
7 4
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT Notes to the Consolidated Financial Statements continued
For the year ended 31 December 2020
27. Capital management policies and procedures continued
Please note that this document is important and requires your immediate attention.
Fair values of financial instruments
The fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date. Where applicable, further information about the assumptions
made in determining fair values is disclosed in the notes specific to that asset or liability.
Set out below is a comparison by category of carrying amounts and fair values of all the Group’s financial instruments:
If you are in any doubt as to the action to be taken, please consult an independent adviser immediately. If you have sold or transferred
or otherwise intend to sell or transfer all of your holding of ordinary shares in the Company prior to the record date (as described in
Note 12) for the Annual General Meeting of the Company on 18 August 2021 11:00 AM you should send this document, together with the
accompanying Form of Proxy, to the (intended) purchaser or transferee or to the stockbroker, bank or other agent through whom the sale
or transfer was or is to be effected for transmission to the (intended) purchaser or transferee. If you have sold some only of your ordinary
shares then please retain this document.
Carrying Amount
Fair Value
2020
£’000
2020
£’000
2019
£’000
2019
£’000
2020
£’000
2020
£’000
2019
£’000
2019
£’000
Group Company
Group Company
Group Company
Group Company
Financial assets
Cash and cash equivalents
2,978
Nil
453
Nil
2,978
Nil
453
Nil
Loans and receivables
Trade and other receivables (current)
Trade and other receivables (non-current)
Trade and other payables
Other financial liability
298
100
(1,385)
(1,651)
Nil
4,574
534
7,027
93
8,508
298
100
Nil
4,574
534
7,027
93
8,508
(6)
-
(318)
(1,651)
(6)
-
(1,385)
(1,651)
(6)
-
(318)
(1,651)
(6)
-
The fair value of trade and other receivables is estimated as the present value of future cash flows discounted at the market rate of
interest at the reporting date. For receivables and payables with a remaining life of less than one year, the notional amount is deemed to
reflect fair value. All other receivables and payables are, where material, discounted to determine the fair value.
When measuring the fair value of an asset or a liability, the Group and Company uses observable market data as far as possible. Fair values
are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset
or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Differences arising between the carrying and fair value are considered not significant to adjust for in these accounts. The carrying and fair
value of intercompany balances are the same as if they are repayable on demand.
COVID-19 – IMPORTANT – PLEASE READ
The Board takes its responsibility to safeguard the health of its shareholders, stakeholders and employees very seriously and so the
following measures will be put in place for the AGM in response to the COVID-19 pandemic and the current social distancing measures
being implemented by the Government in the United Kingdom.
The formal business of the Annual General Meeting (AGM) will only be to consider and vote upon the resolutions set out in the notice of
meeting. The holding of the AGM will be kept under review in line with Public Health England guidance. It is intended that the meeting will
be held with no more than 15 shareholders and 4 Directors present. The Company is taking these precautionary measures to safeguard its
shareholders’, stakeholders’ and employees’ health and make the AGM as safe and efficient as possible.
SHAREHOLDERS WISHING TO VOTE ON ANY OF THE MATTERS OF BUSINESS ARE STRONGLY URGED TO DO SO THROUGH
COMPLETION OF A FORM OF PROXY which must be completed and submitted in accordance with the instructions thereon. It is
emphasised that any forms of proxy being returned via a postal service should be submitted as soon as possible to allow for any delays
to or suspensions of postal services in the United Kingdom as a result of measures being implemented by the Government of the United
Kingdom. Shareholders wishing to vote on any matters of business are strongly urged to do so through registering their proxy
appointment and voting by proxy online and to appoint the Chairman of the Meeting as your proxy. This will enable the Chairman
of the Meeting to vote on your behalf, and in accordance with your instructions, at the AGM.
In line with corporate governance best practice and in order that any proxy votes of those shareholders who are not able to attend and to
vote in person are fully reflected in the voting on the resolutions, the Chairman of the meeting will direct that voting on all resolutions set
out in the notice of meeting will take place by way of a poll. The final poll vote on each resolution will be published immediately after the
AGM on the Company’s website.
Further information on voting procedures follows the resolutions below. Queries regarding these procedures may be directed to the
Company’s registrars, Computershare Investor Services plc, The Pavilions, Bridgewater Road, Bristol BS99 6ZY (telephone number:
+44 (0) 370 889 3196.
7 6
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT
Notice of the 2021 Annual General Meeting of
Ariana Resources PLC
Company Number: 05403426
ii. to holders of other equity securities as required by the
rights of those securities or as the Directors otherwise
consider necessary, but subject to such exclusions or
other arrangements as the Board may deem necessary
or expedient in relation to treasury shares, fractional
entitlements, record dates, legal or practical problems in
or under the laws of any territory or the requirements of
any regulatory body or stock exchange; and
b.
the allotment (otherwise than pursuant to paragraph 5a
above) of equity securities up to an aggregate nominal
amount of £250,000.
The power granted by this resolution will unless renewed, varied
or revoked by the Company, expire at the conclusion of the next
Annual General Meeting of the Company following the date of
the passing of this resolution or (if earlier) 15 months from the
date of passing this resolution, save that the Company may,
before such expiry make offers or agreements which would or
might require equity securities to be allotted after such expiry
and the Directors may allot equity securities in pursuance of
any such offer or agreement notwithstanding that the power
conferred by this resolution has expired.
This resolution revokes and replaces all unexercised powers
previously granted to the Directors to allot equity securities
as if section 561(1) of the 2006 Act did not apply, but without
prejudice to any allotment of equity securities already made or
agreed to be made pursuant to such authorities.
6. That, the Company be authorised generally and unconditionally
to make market purchases (within the meaning of section 693(4)
of the Companies Act 2006) of ordinary shares of £0.001 each,
provided that:
a.
the maximum aggregate number of ordinary shares that
may be purchased is 5% of the issued share capital of the
Company as at the date of the market purchase;
b.
the minimum price (excluding expenses) which may be paid
for each ordinary share is £0.001;
c.
the maximum price (excluding expenses) which may be
paid for each ordinary share is to be no higher than the
average mid-market closing price of an ordinary share in the
Company on the day prior to the day the purchase is made;
d.
The authority conferred by this resolution shall expire at the
conclusion of the Company’s next annual general meeting
save that the Company may, before the expiry of the
authority granted by this resolution, enter into a contract
to purchase ordinary shares which will or may be executed
wholly or partly after the expiry of such authority.
e.
The Directors may hold any such ordinary shares in
Treasury and are then entitled to resell the same, satisfy the
issue of new ordinary shares or cancel any such ordinary
shares so acquired, as allowed by the Companies Act.
By Order of the Board dated
13 July 2021
Notice is hereby given that the Annual General Meeting of Ariana
Resources PLC (the “Company”) will be held at the East India
Club, 16 St James’s Square, London, SW1Y 4LH on 18 August
2021 at 11:00 AM in order to consider and, if thought fit, pass
resolutions 1 to 4 as Ordinary Resolutions and Resolutions 5 & 6
as Special Resolutions:
Ordinary resolutions
1. To receive the Annual Report and Accounts for the year ended
31 December 2020.
2. To re-elect William Payne who is retiring pursuant to Article
27.1.2 of the Articles of Association as a Director of the Company.
3. To re-appoint PKF Littlejohn as auditors and to authorise the
Directors to fix their remuneration.
4. That the Directors be generally and unconditionally authorised to
allot Relevant Securities (as defined in the notes to this Notice) up
to a maximum nominal amount of £500,000 comprising:
a.
equity securities (as defined by section 560 of the
Companies Act 2016) of ordinary shares of 0.1p each in
the capital of the Company (“Ordinary Shares”) up to an
aggregate nominal amount of £250,000 in connection with
an offer by way of a rights issue:
b.
i.
to holders of Ordinary Shares in proportion (as nearly as
may be practicable) to their respective holdings; and
ii. to holders of other equity securities as required by the
rights of those securities or as the Directors otherwise
consider necessary, but subject to such exclusions or
other arrangements as the Directors may deem necessary
or expedient in relation to treasury shares, fractional
entitlements, record dates, legal or practical problems in
or under the laws of any territory or the requirements of
any regulatory body or stock exchange; and
in any other case, up to an aggregate nominal amount
of £250,000, provided that this authority shall, unless
renewed, varied or revoked by the Company, expire on
the date which is 15 months after the date on which this
resolution is passed or, if earlier, the date of the next annual
general meeting of the Company save that the Company
may, before such expiry, make offers or agreements
which would or might require Relevant Securities to be
allotted and the Directors may allot Relevant Securities in
pursuance of such offer or agreement notwithstanding that
the authority conferred by this resolution has expired.
This resolution revokes and replaces all unexercised
authorities previously granted to the Directors to allot
Relevant Securities but without prejudice to any allotment
of shares or grant of rights already made, offered or agreed
to be made pursuant to such authorities.
Special resolutions
5. That, subject to the passing of Resolution 4 the Directors be
given the general power to allot equity securities (as defined
by Section 560 of the 2006 Act) for cash, either pursuant to
the authority conferred by Resolution 4 or by way of a sale of
treasury shares, as if Section 561(1) of the 2006 Act did not
apply to any such allotment, provided that this power shall be
limited to:
a.
the allotment of equity securities in connection with an
offer by way of a rights issue:
i.
to the holders of ordinary shares in proportion (as nearly
as may be practicable) to their respective holdings; and
Notes:
1.
2.
3.
4.
5.
6.
7.
8.
9.
As a member of the Company you are entitled to appoint a
proxy to exercise all or any of your rights to attend, speak
and vote at a general meeting of the Company. You can only
appoint a proxy using the procedures set out in these notes.
Appointment of a proxy does not preclude you from attending
the meeting and voting in person. If you have appointed
a proxy and attend the meeting in person, your proxy
appointment will automatically be terminated. Shareholders
are reminded of the COVID-19 restrictions.
A proxy does not need to be a member of the Company but
must attend the meeting to represent you. To appoint as
your proxy a person other than the Chairman of the meeting,
insert their full name in the box. If you sign and return this
proxy form with no name inserted in the box, the Chairman
of the meeting will be deemed to be your proxy. Where you
appoint as your proxy someone other than the Chairman, you
are responsible for ensuring that they attend the meeting
and are aware of your voting intentions. If you wish your
proxy to make any comments on your behalf, you will need to
appoint someone other than the Chairman and give them the
relevant instructions directly. Shareholders are reminded of the
COVID-19 restrictions.
You may not appoint more than one proxy to exercise rights
attached to any one share.
To direct your proxy how to vote on the resolutions mark
the appropriate box with an ‘X’. To abstain from voting on a
resolution, select the relevant “Vote withheld” box. A vote
withheld is not a vote in law, which means that the vote will
not be counted in the calculation of votes for or against the
resolution. If you give no voting indication, your proxy will vote
or abstain from voting at his or her discretion. Your proxy will
vote (or abstain from voting) as he or she thinks fit in relation to
any other matter which is put before the meeting.
To appoint a proxy you must ensure that the attached proxy
form is completed, signed and sent to Computershare Investor
Services PLC, The Pavilions, Bridgwater Road, Bristol BS99 6ZY
by no later than 11 AM on 16 August 2021.
In the case of a member which is a company, the Form of Proxy
must be executed under its common seal or signed on its behalf
by an officer of the Company or an attorney for the Company.
Any power of attorney or any other authority under which this
proxy form is signed (or a duly certified copy of such power or
authority) must be included with the proxy form.
In the case of joint holders, where more than one of the joint
holders purports to appoint a proxy, only the appointment
submitted by the most senior holder will be accepted. Seniority
is determined by the order in which the names of the joint
holders appear in the Company’s register of members in respect
of the joint holding (the first-named being the most senior).
10.
If you submit more than one valid proxy appointment, the
appointment received last before the latest time for the
receipt of proxies will take precedence. CREST members
who wish to appoint a proxy or proxies through the CREST
electronic proxy appointment service may do so for the
meeting (and any adjournment of the meeting) by following
the procedures described in the CREST Manual available on
the website of Euroclear UK and Ireland Limited (“Euroclear”)
at www.euroclear.com. CREST Personal Members or other
CREST sponsored members (and those CREST members
who have appointed a voting service provider) should refer
to their CREST sponsor or voting service provider, who will be
able to take the appropriate action on their behalf. In order
for a proxy appointment or instruction made by means of
CREST to be valid, the appropriate CREST message (a “CREST
Proxy Instruction”) must be properly authenticated in
accordance with Euroclear’s specifications and must contain
the information required for such instructions, as described
in the CREST Manual. The message (regardless of whether it
constitutes the appointment of a proxy or an amendment to
the instruction given to a previously appointed proxy) must,
in order to be valid, be transmitted so as to be received by
the issuer’s agent Computershare Investor Services PLC
(ID number 3RA50) not later than 48 hours before the time
appointed for holding the meeting. For this purpose, the time
of receipt will be taken to be the time (as determined by the
timestamp generated by the CREST system) from which the
issuer’s agent is able to retrieve the message. The Company
may treat as invalid a proxy appointment sent by CREST
in the circumstances set out in Regulation 35(5)(a) of the
Uncertificated Securities Regulations 2001.
11.
12.
You may not use any electronic address provided in this proxy
form to communicate with the Company for any purposes
other than those expressly stated.
Pursuant to Regulation 41 of the Uncertificated Securities
Regulations 2001, the time by which a person must be entered
on the register of members in order to have the right to attend
and vote at the Annual General Meeting is 6pm on 16 August
2021, (being not more than 48 hours prior to the time fixed
for the Meeting) or, if the Meeting is adjourned, such time
being not more than 48 hours prior to the time fixed for the
adjourned meeting. Changes to entries on the register of
members after that time will be disregarded in determining the
right of any person to attend or vote at the Meeting.
Relevant Securities means:
• Shares in the Company other than shares allotted pursuant to:
• an employee share scheme (as defined
by section 1166 of the Act);
• a right to subscribe for shares in the Company where the
grant of the right itself constituted a Relevant Security; or
• a right to convert securities into shares in the Company where
the grant of the right itself constituted a Relevant Security.
• Any right to subscribe for or to convert any security into
shares in the Company other than rights to subscribe for
or convert any security into shares allotted pursuant to an
employee share scheme (as defined by section 1166 of the
Act). References to the allotment of Relevant Securities
in the resolution include the grant of such rights
7 8
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FINANCIAL REPORTARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020ARIANA RESOURCES PLC - ANNUAL REPORT & ACCOUNTS 2020FINANCIAL REPORT
A R I A N A R E S O U R C E S P L C - A N N U A L R E P O R T & A C C O U N T S 2 0 2 0
Advisors
Directors
M J de Villiers
A K Sener
W J B Payne
C J S Sangster
Secretary
M J de Villiers
Registered Office
2nd Floor, Regis House
45 King William Street
London, EC4R 9AN
Registered Number
05403426
Auditors
PKF Littlejohn LLP
15 Westferry Circus, London, E14 4HD
Bankers
HSBC
186 Broadway, Didcot, Oxfordshire, OX11 8RP
Solicitors
Gowling WLG (UK) LLP
4 More London Riverside, London, SE1 2AU
Joint Broker
Panmure Gordon (UK) Limited
1 New Change, London, EC4M 9AF
Nominated Advisor and Joint Broker
Beaumont Cornish Limited
Building 3, 566 Chiswick High Road, London W4 5YA
Registrars
Computershare Investor Services PLC
The Pavilions, Bridgwater Road, Bristol, BS13 8AE
Public Relations
Yellow Jersey PR
Mappin House, Oxford St, London, W1W 8HF
Design & Production by
haywoodsener.com
8 0
F I N A N C I A L R E P O R T