Annual Report and Accounts
– 2018 –
The Directors of ECR Minerals plc (the “Directors” or the “Board”) present their report and
audited financial statements for the year ended 30 September 2018 for ECR Minerals plc
(“ECR”, the “Company” or the “Parent Company”) and on a consolidated basis (the
“Group”)
CONTENTS
Chairman’s Statement
Chief Executive Officer’s Report
Directors’ Biographies
Strategic Report
Report of the Directors
Independent Auditor’s Report
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated & Company Statement of Financial Position
Consolidated Statement of Changes in Equity
Company Statement of Changes in Equity
Consolidated & Company Cash Flow Statement
Notes to the Financial Statements
Notice of Annual General Meeting
Company Information
1
3
6
7
14
17
20
21
22
23
24
25
26
42
47
Christian Dennis resigned as a non-executive director of
the Company in July 2018, to focus on his other business
interests. The Board would like to thank Christian for his
service as a director of ECR and wish him well for the
future.
Pleasingly, the gold price has made a healthy start to 2019
by returning to levels in excess of USD 1,300 per troy
ounce, and we are hopeful that macroeconomic conditions
will see the price rise further in the near future. Regardless,
the Board remains confident in ECR’s strategic objective of
discovering a multi-million ounce gold deposit, and we look
forward to reporting further progress towards this goal.
Weili (David) Tang
Chairman
28 March 2019
Chairman’s Statement
Over the past year, ECR has continued to advance and
augment its portfolio of gold exploration projects in Australia,
which is one of the world’s principal gold producers and one
of the foremost destinations for global mining investment.
During the financial year ended 30 September 2018 and
since the year-end the Company’s wholly owned Australian
subsidiary Mercator Gold Australia Pty Ltd (“MGA”) has
carried out extensive exploration work in the state of
Victoria, with drilling completed at two prospects in the
Avoca gold project area during calendar year 2018, followed
by drilling at the Creswick gold project in February 2019, and
at the Blue Moon and Black Cat prospects in the Bailieston
gold project area later the same month. The results of these
programmes are discussed in the Chief Executive Officer’s
report, to the extent which they are available. I am pleased
to note that drilling results announced to date have included
some significant intercepts at Blue Moon, the most exciting
being 2 metres at 17.87 g/t gold from 57 metres downhole
in BBM007, within a zone of 15 metres at 3.81 g/t gold from
51 metres.
In late 2018, the Group moved into another world-class
Australian gold province, the Yilgarn Craton in Western
Australia. MGA has made nine exploration licence
applications over a 1,600 square kilometre land package
which has been identified as a potential greenstone-hosted
orogenic gold exploration opportunity with significant
potential to contain Archaean greenstones buried beneath
Permian cover sequences of the Canning Basin.
Importantly, ECR is moving forward from a position of
financial strength, having raised £1.35 million (before costs)
during calendar year 2018, and with the potential for more
than £2 million of further funding to come into the Company
through the exercise of warrants issued to investors as part
of those fundraisings.
I would like to welcome Sam Garrett to the Board as a non-
executive director. Mr Garrett, who is a resident of Australia,
holds a Bachelor of Science degree with First Class Honours
in Geology and a Master of Economic Geology degree, both
from the University of Tasmania. He also holds a Master
of Applied Finance degree from Macquarie University
in Australia. Mr Garrett has over 30 years of exploration
management, project assessment and operational
experience working for large multi-national and junior
mining and exploration companies in ten countries including
Australia, Argentina and the Philippines. I am sure that Sam
has a valuable contribution to make as a director of ECR.
1
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Current tenement position of ECR’s wholly owned Australian subsidiary Mercator Gold Australia Pty Ltd in the state of
Victoria, Australia.
Location of exploration licences applied for in Western Australia by ECR’s wholly owned Australian subsidiary Mercator Gold
Australia Pty Ltd, comprising the Windidda project.
2
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Chief Executive Officer’s Report
The Group’s concentration on gold exploration in the state
of Victoria, Australia, continued apace during the year, as
did the exploration boom across the Victorian gold province
as a whole. The latter has been driven in large part by the
success story which has unfolded at the Fosterville gold
mine, which produced more than 350,000 ounces of gold
in 2018 and is firmly established as Victoria’s largest gold
producer.
At the same time, we have expanded our footprint to
Western Australia by applying for a package of nine
exploration licences in the Yilgarn Craton, which comprise
the Windidda gold project, and maintained our presence in
Argentina at the SLM gold project in La Rioja Province.
We are also continuously evaluating potential new
opportunities and will engage with those, such as the
Windidda project, that we determine may have the potential
to enable the achievement of ECR’s primary strategic
objective, which is to generate value for shareholders
through the discovery of a multi-million ounce gold deposit.
By convention, much of this Chief Executive Officer’s
Report relates to activities which have taken place after
30 September 2018. Diamond drilling at the Bung Bong,
Monte Christo and Blue Moon prospects was completed
prior to the year-end, as was rock-chip sampling in the
Byron and Cherry Tree areas. Reverse circulation (RC)
drilling at Blue Moon and the Creswick project and rotary
air blast (RAB) drilling at the Black Cat prospect has taken
place in the current financial year.
GOLD EXPLORATION IN VICTORIA,
AUSTRALIA
In Victoria, ECR’s wholly owned Australian subsidiary
Mercator Gold Australia Pty Ltd (“MGA”) has 100%
ownership of six exploration licences: Avoca (EL5387),
Bailieston (EL5433), Creswick (EL006184), Moormbool
(EL006280 and EL006913) and Timor (EL006278).
MGA has pending applications for four further exploration
licences, two south and south west of the existing licence
at Creswick; and two others in the vicinity of the Bailieston
and Moormbool project areas, to secure available ground
south and south east of a licence applied for by Newmont
Exploration Pty Ltd.
In early February 2019, MGA commenced a reverse
circulation (RC) drilling programme at Creswick, which was
followed by a second RC programme at the Blue Moon
prospect in the Bailieston gold project area. In parallel, a
rotary air blast (RAB) programme was carried out at the
Black Cat prospect, which is also within the Bailieston gold
project area.
The Company announced assay results in respect of three
holes drilled at Blue Moon on 14 March 2019, with results
from a further nine holes expected to be announced soon.
Assay results from drilling at Black Cat and Creswick are
also expected to be announced in the near future. From
the announced Blue Moon results, significant intersections
included 2 metres at 17.87 g/t gold from 57 metres down
hole in BBM007, within a zone of 15 metres at 3.81 g/t
gold from 51 metres.
Bailieston Gold Project - EL5433
The Bailieston project is at the epicentre of the current gold
exploration boom in Victoria, being located close to the
highly successful Fosterville mine owned by Kirkland Lake
Gold. This point is underlined by the arrival of Newmont
Exploration in the district with an application for ground
immediately to the north of the Black Cat prospect.
Blue Moon Prospect
The focus of activities in the Bailieston project area for
the past year has been the Blue Moon prospect. This was
identified as a high priority prospect in early 2018 when Dr
Rodney Boucher, an experienced Victorian gold geologist,
commenced a review of all available data on MGA’s
exploration licences (at that time numbering four licences),
complemented by geological mapping and geochemical
surveys in selected areas. The purpose of this work was
to help define targets for a diamond drilling programme
extending across a number of MGA’s prospects.
The geochemical surveys utilised a portable XRF to
delineate proxy minerals associated with gold. An arsenic-
anomalous zone up to 40 metres wide and more than 200
metres long was identified at Blue Moon, and previous
work showed anomalism over a further 150 metres to the
west. Previous rock chip samples included results of 12.1,
10.1 and 7.0 g/t gold, and previous soil surveys identified
gold to 5.0 g/t.
The diamond drilling at Blue Moon was intended to test
the arsenic and antimony anomalies identified by the soil
geochemical survey completed by MGA in early 2018.
Positive results from the drilling were announced in July
2018.
Diamond drill holes BBM001 and BBM002 were designed
to establish the dip of the host sandstones and assess the
potential for gold mineralisation. Intercepts of 5.45 metres
at 0.12 g/t gold from 33.95 metres and 10.0 metres at 0.16
g/t Au from 43.8 metres were obtained in BBM001 and
BBM002, respectively. Upon drilling faulted, stockworked
sandstone in the first two holes, BBM003 was drilled down
dip to test the nature of the cross-cutting faults and veins
and to obtain a large number of samples for analysis. An
intercept of 39.5 metres at 0.3 g/t gold from 24.2 metres,
including 2.7 metres at 1.12 g/t gold from 60 metres, was
obtained in BBM003. Intersections given in this paragraph
are apparent width.
3
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Chief Executive Officer’s Report continued
The gold mineralisation intersected is hosted in an
approximately 5.5 metre wide medium-grained sandstone
within a thick bioturbated shale. Diorite sills have intruded
along the margins of the sandstone. The sandstone is
metamorphosed to quartzite and the brittle host showed
stockwork vein development in each of the three
holes. Small iron-oxide pseudomorphs thought to be of
arsenopyrite and pyrite were disseminated throughout the
quartzite. Deep weathering of the sandstone meant that no
samples of fresh rock could be obtained from the diamond
drill holes to verify the minerals.
The high repeatability of the assay results from MGA’s
diamond drilling at Blue Moon supports the hypothesis that
the prospect is a disseminated gold occurrence comparable
to some of the mineralisation exploited at the Fosterville
mine approximately 50km away.
Given the deep weathering and the potential for gold
depletion in the oxidised sulphides, it was considered
possible that higher grades would be encountered at depth
in the fresh (un-weathered) rock. Obtaining samples from
fresh rock was a key objective of the drilling completed at
Blue Moon in February 2019.
The twelve reverse circulation (RC) holes (BBM004-15)
completed at Blue Moon by MGA aimed to intercept the
sandstone on 50 metre spacing across three sections and
to gain samples from beneath the oxide zone.
Assay results have been announced for holes BBM007,
BBM006 and BBM004, and have shown both high grade
intervals and significant widths of anomalous gold grades.
As well as 2 metres at 17.87 g/t gold from 57 metres down
hole in BBM007, within a zone of 15 metres at 3.81 g/t
gold from 51 metres, an intersection of 3 metres at 3.88
g/t gold from 170 metres down hole within a zone of 11
metres at 2.42 g/t gold from 169 metres in hole BBM006
has been announced. Intersections given in this paragraph
are apparent width.
These results indicate that a high grade zone exists
within the target sandstone host. Further drill results
and interpretation will be required to understand any
concentration of mineralisation within shoots.
The base of the oxide zone was at 64 metres in BBM007
within the host sandstone. Visible gold was seen in three
samples (3 metres at 13.4 g/t gold from 57-60 metres) and
it is possible these are elevated gold values as a result of
supergene enrichment close to the base of the oxide zone.
BBM004 & 6 intercepted the host sandstone beneath the
oxide zone. Logging recorded estimates of up to 4% pyrite
and 2% arsenopyrite with minor quartz. No visible gold was
seen in these samples.
In addition to Blue Moon, two further prospects with
similar characteristics at surface, namely anomalous
arsenic and broad areas of quartz float, have been identified
within an approximately 3km radius. MGA will be further
assessing these prospects, referred to as Red Moon and
Yellow Moon, in the months to come.
Black Cat Prospect
Black Cat is among the high priority targets identified by the
geophysical interpretation and targeting study completed
for MGA by Terra Resources in late 2017 and has not been
previously drilled. The prospect is immediately south of
ground recently applied for by Newmont Exploration and
contains 220 metres of historical workings along three
known lines of quartz reef. Strong gold-in-soil anomalism
in some areas indicates unworked reefs may remain to be
discovered, and rock chip sampling of quartz-poor material
indicates potential for disseminated gold. Rock chip
samples at Black Cat have returned encouraging grades up
to 11.3 g/t gold.
Rotary air blast (RAB) drilling is a low cost method well
suited to the first pass testing required at Black Cat, and a
450 metre RAB programme commenced in February 2019.
Other Prospects at Bailieston
Away from Black Cat and the ‘Moon’ prospects, exploration
work at Bailieston included 151 surface rock chip samples
to help assess targets in the Byron and Cherry Tree areas,
which contain numerous northwest trending quartz reefs,
including the Byron, Scoulars and Maori reefs that were
drilled by MGA in 2017. Of these samples, 51 returned
gold grades in excess of 0.5 g/t, with the highest being
67.4 g/t. Of the high grade samples, 26 were re-assayed in
accordance with common QA/QC practice, and the repeat
assays demonstrated good consistency with the first round
of assays.
Creswick Gold Project - EL006184
The Creswick project targets gold mineralisation hosted
within the Dimocks Main Shale (DMS), which extends
over a 15km trend from the mining centre of Ballarat to
the south, approximately 7km of which is covered by
EL006184 and MGA’s two exploration licence applications.
In the project area, the DMS is an approximately 25 metre
wide shale containing bedding and cleavage-parallel
auriferous quartz veins. Only two holes have previously
been drilled to test the DMS within EL006184, both in the
1990s. The results of this drilling included an intercept of 2
metres at 12.28 g/t gold. The best previous drill intercept
into the DMS elsewhere is 2 metres at 176 g/t gold.
4
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Avoca Gold Project - EL5387
MGA drill-tested two gold prospects in the Avoca project
area in April and May 2018, also following Dr Boucher’s
data review, mapping and geochemical surveying. Five
holes were completed at the Bung Bong prospect using a
diamond core rig. Thereafter, the rig moved to the Monte
Christo prospect, where two holes were drilled. Assay
results were announced in early June 2018.
All five holes at Bung Bong and the two holes at Monte
Christo fulfilled their intended purpose, which was to
test the structural architecture of the target areas. The
holes were the first ever drilled at both Bung Bong and
Monte Christo, and gold mineralisation was intersected
at both prospects, although no high-grade shoots were
encountered.
WESTERN AUSTRALIA
Windidda Gold Project
In December 2018, MGA submitted nine contiguous
exploration licence applications covering a 1,600 square
kilometre package of ground prospective for gold
mineralisation in the Yilgarn region of Western Australia,
east of the town of Wiluna. The application package is to
be known as the Windidda gold project.
FINANCIAL RESULTS FOR THE YEAR
ENDED 30 SEPTEMBER 2018
For the year to 30 September 2018 the Group recorded a
total comprehensive expense of £721,460, compared with
£562,649 for the year to 30 September 2018.
The largest contributor to the total comprehensive expense
was the line item “other administrative expenses”, which
represents the costs of operating the Group and carrying
out exploration at its projects, where these costs are
ineligible for capitalisation under applicable accounting
standards.
The Group’s net assets at 30 September 2018 were
£3,651,545, in comparison with £3,735,225 at 30
September 2017. The decrease is due to increased
exploration assets as a result of the capitalisation of
exploration expenditure during the year being offset by a
reduction in cash and cash equivalents.
Archaean greenstones host many of Western Australia and
the world’s most prolific gold deposits, and the Windidda
applications cover a significant proportion of an identified
gravity-magnetic trend with known gold prospects along
trend in outcropping greenstone to the south (outside the
application areas).
Craig Brown
Chief Executive Officer
28 March 2019
The under-cover greenstone gold exploration model has
been successfully tested by Greatland Gold (LON:GGP) at
its Ernest Giles project located approximately 125km east
of the Windidda project.
Previous exploration within the Windidda project area
has targeted base metal and manganese deposits within
the cover sequences. Gravity and magnetic anomalies
interpreted to be hosted in greenstone units beneath
the cover have not been targeted. These targets are
expected to be amenable to aircore drilling to enable rapid
assessment of potential for gold mineralisation, after the
exploration licences are granted.
Iceberg Gold Project
The Company secured an option over the Iceberg project in
Western Australia in August 2018, but after completing its
due diligence, elected not to proceed with the acquisition.
5
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Samuel James Melville Garrett
Non-Executive Director
(aged 52)
Mr Garrett holds a Bachelor of Science degree with First
Class Honours in Geology and a Master of Economic
Geology degree, both from the University of Tasmania.
He also holds a Master of Applied Finance degree from
Macquarie University in Australia. Mr Garrett has 30 years
of exploration management, project assessment and
operational experience working for large multi-national and
junior mining and exploration companies in ten countries
including Australia, Argentina and the Philippines.
Directors’ Biographies
Weili (David) Tang
Non-Executive Chairman
(aged 53)
David Tang was previously the President of China
Nonferrous Metals Int’l Mining Co., Ltd. (CNMIM) and
the Managing Director of China Nonferrous Gold Ltd, an
AIM-listed company which was formerly known as Kryso
Resources plc. China Nonferrous Gold is focused on the
Pakrut gold mine in Tajikistan, where first gold was poured
in 2015. Mr Tang has previously served as a director to
several companies involved in mining or exploration in
Africa, South East Asia and Australia. Mr Tang graduated
with a Bachelor of Science degree (1988) majoring in
computer science from Central-South University, China and
also holds a Master of Science degree (1991). In the 1990s,
he pioneered the trading system for the first nonferrous
metals futures exchange in China. He worked for several
years in Canada in investment management and consulting,
before returning to China to take up office at CNMIM in
2003.
Craig William Brown
Director and Chief Executive Officer
(aged 48)
Craig Brown was appointed as ECR’s Finance Director
in May 2016 before becoming Chief Executive Officer
in September 2016. Previously, he was a founding
shareholder of Kryso Resources plc, now known as
China Nonferrous Gold Ltd. Mr Brown acted as Finance
Director and Company Secretary of Kryso before becoming
Managing Director in 2010 and stepping down from the
board in September 2013. During this period, Kryso/CNG
delineated a 5 million ounce JORC Mineral Resource
at the Pakrut gold project in Tajikistan, completed a
bankable feasibility study for the project, obtained debt and
equity finance for mine development, and commenced
construction of the mine and infrastructure. Prior to his
roles with Kryso/CNG, Mr Brown held positions with Gulf
International Minerals Ltd and Nelson Gold Ltd, both of
which also successfully put gold mines into production
during his tenure.
6
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Strategic Report
The Directors of the Company present their Strategic
Report for the year ended 30 September 2018.
Principal Activities
The principal activity of the Group is the identification,
acquisition, exploration and development of mineral
projects. The principal activity of the Company is that of a
holding company for its subsidiaries and other investments,
although project development activities may also be
undertaken directly. Whilst the Group’s historical focus
has been on gold, as is its current focus, it also considers
opportunities in other mineral commodities.
The main current area of activity is Central Victoria,
Australia, and the Group continues to review potential new
projects on a highly selective basis, with a concentration on
precious, base and strategic metals.
Organisation Review
The Company is incorporated in England but operates in
other countries through foreign subsidiaries and contractual
arrangements. Craig Brown, Director & Chief Executive
Officer is based in the United Kingdom while Weili Tang,
Non-Executive Chairman, is based in the People’s Republic
of China (PRC), and Samuel Garrett, Non-Executive
Director, is based in Australia. The corporate structure of
the Group reflects its present and historical activities and
the requirement, where appropriate, to have incorporated
entities in particular countries.
The Group’s exploration activity in Argentina, which in
physical terms ceased in 2015 and resumed in 2017, has
been undertaken through an Argentinian wholly owned
subsidiary, Ochre Mining SA. There are two dormant
subsidiaries, both registered in the USA, which relate to
past projects.
The Company has a wholly owned Australian subsidiary
named Mercator Gold Australia Pty Ltd (“MGA”), which
was released from external administration in December
2014. MGA has accumulated substantial tax losses from
its past trading, and is therefore a suitable vehicle for any
future profit generative activities of the Group in Australia.
The Group’s activities in the Philippines, which ceased in
2016, were undertaken under the auspices of an earn-in
and joint venture agreement. Further details of the Group’s
interests in Argentina and the Philippines can be found
under “Operating Review” below.
The Directors aim to ensure that the Group operates with
as low a cost base as is practical in order to maximise the
amount spent on mineral exploration and development,
in which activities the expertise and experience of the
Directors and consultants of the Group are employed
to add value to the Group’s projects. The Company has
three male Directors, one of whom is an employee, and
two other employees. The services of various consultants
are utilised to meet the needs of the Group in respect of
technical and other activities.
The Group’s activities are financed through periodic
capital raisings, principally through the placement of the
Company’s ordinary shares. As the Group’s projects
become more advanced, other forms of finance appropriate
to the stage of development and potential of each project
may be considered.
Financial & Performance Review
The Group’s ongoing activities are solely in mineral
exploration and development. It is not in production at any
of its current projects and hence has no income.
For the year to 30 September 2018 the Group recorded a
total comprehensive expense attributable to shareholders
of the Company of £721,460, compared with £562,649 for
the year to 30 September 2017. In both 2017 and 2018,
the largest contributor to the total comprehensive expense
was the line item “other administrative expenses”, which
represents the costs of operating the Group and carrying
out exploration at its projects, where these costs are
ineligible for capitalisation under applicable accounting
standards. The Group’s net assets as at 30 September
2018 were £3,651,545, in comparison with £3,735,225 at
30 September 2017.
Exploration activity took place in Central Victoria, Australia
during the year to 30 September 2018, as discussed in the
Chief Executive Officer’s Report and later under “Operating
Review”. Capitalised exploration assets are valued in the
Consolidated Statement of Financial Position at cost; this
value should not be confused with the realisable value of
the relevant projects or be considered to determine the
value accorded to the projects by the stock market, which
in both cases may be considerably different.
Strategy and Business Model
The Group’s strategy is to locate and acquire mineral
projects which show good prospects. The Directors select
these projects after a thorough and critical appraisal. This
is needed as in general, across the industry as a whole,
the percentage of mineral exploration and development
projects which go on to become fully operational and
producing mines is relatively low.
After acquiring an interest in a project, the strategy is then
to leverage the Group’s commercial experience and access
to technical expertise to explore and further develop the
project, and in doing so to create value for the benefit of
the Company’s shareholders. Decisions can then be made
at appropriate times as to whether to continue the project
into production, enter into a joint venture with another
company, or sell the project outright.
7
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Strategic Report continued
Where a project has been disposed of, the proceeds of
that disposal will usually be reinvested in new projects. In
the case of very significant proceeds from a disposal, the
Directors would also consider distributions to shareholders.
The Group’s business model is to be an efficient and
successful explorer and developer of mineral deposits.
The rights to carry out these activities may be acquired
through the receipt by the Group of licences from the
relevant authorities, or by negotiating to acquire rights
from existing owners. The Group will generally seek to
acquire such rights for low initial payments, with any
further amounts paid later depending on the success of
the project. This enables the risk inherent to the Group’s
activities to be somewhat mitigated.
The business model is put into practice by the Directors
combined with the use of consultants on an as required
basis, both in the UK and overseas. In this way, overheads
can be kept as low as possible and the flexibility of the
Group can be maintained.
Key Performance Indicators (“KPIs”)
KPIs which apply in most businesses are not usually
particularly relevant to mineral exploration and development
companies which, for example, typically have little or no
product sales.
The Board has previously identified some key KPIs which
are considered of relevance. These are detailed below.
Project development:
The Group reports the achievement of exploration and
development targets, including results of exploration,
definition of exploration targets, and reporting of mineral
resources and mineral reserves using internationally
recognised protocols. During the year drilling results were
obtained from the Bung Bong and Monte Christo prospects
in the Avoca gold project area (EL5387), together with
the Blue Moon prospect in the Bailieston gold project
area (EL5433), in Central Victoria, Australia. These drilling
programmes are considered to have fulfilled their intended
purpose.
End of year cash balance and attributable cash resources:
This KPI is of critical importance and it is a good indicator
of whether the Group has sufficient financial resources.
The Directors take all necessary steps to minimise the rate
of cash burn on overheads (commensurate with ensuring
that the Group’s quality standards, including its human
resources, are not compromised and that it has adequate
resources, both human and otherwise, to carry out its
activities). The Group held £782,142 of cash and cash
equivalents at 30 September 2018, versus £1,082,994
at the beginning of the year. The Directors consider the
performance of the Group in this regard to be in line
with the activities required to fulfil the Group’s work
programmes.
Operating Review
As mentioned above, the Group’s current physical
operations are located in Central Victoria, Australia. The
Group holds interests in Argentina and the Philippines but
did not carry out significant operations in either jurisdiction
during the year and has not done so since the year-end.
Potential new projects are reviewed from time to time in line
with the strategy discussed earlier in this Strategic Report.
Avoca, Bailieston, Creswick, Moormbool and Timor gold
projects, Australia
These projects are located in Central Victoria and are
100% held by ECR’s wholly owned Australian subsidiary
MGA. The exploration licences comprising the Moormbool
(EL006280) and Timor (EL006278) projects were granted
to MGA during the year ended 30 September 2017,
while the Avoca (EL5387) and Bailieston (EL5433)
exploration licences were acquired from Currawong
Resources Pty Ltd (“Currawong”) pursuant to a deed of
assignment (the “Deed”) entered into between MGA and
Currawong during the year ended 30 September 2016.
The Company announced the acquisition of the Creswick
licence, EL006184, in April 2018. EL006913, which abuts
EL006280, was granted to MGA in March 2019.
In respect of future production from the Avoca and/
or Bailieston projects (if any), the original holder of the
licences, Currawong, is entitled to be paid a net profits
interest royalty of 20% in respect of mine dumps and 10%
in respect of other deposits. Royalties on the same basis
would also be payable, subject to the terms of the Deed, in
respect of a 10km Area of Interest (as that term is defined
in the Deed) surrounding the Avoca and Bailieston projects.
This is considered likely to bring the Moormbool and Timor
projects within the ambit of the royalties. Total royalties
payable to Currawong under the Deed are capped at AUD
3.5 million. In addition, AUD150,000 worth of ECR shares
will become issuable to Currawong if any Tenement (as
that term is defined under the Deed) reaches commercial
production.
Exploration activities on MGA’s projects in Victoria during
the year ended 30 September 2018 and since the year-end
are discussed in the Chief Executive Officer’s Report.
Windidda gold project, Western Australia
In December 2018, ECR’s wholly owned Australian
subsidiary MGA submitted nine contiguous exploration
licence applications covering a 1,600 square kilometre
package of ground prospective for gold mineralisation in
the Yilgarn region of Western Australia, east of the town
of Wiluna. The application package is to be known as the
Windidda gold project. This project is further discussed in
the Chief Executive Officer’s Report.
8
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 SLM gold project, Argentina
The SLM project is located in La Rioja Province, Argentina
and is 100% held by ECR’s wholly owned subsidiary Ochre
Mining SA. In November 2015, Argentina elected a new
president who is seen to be relatively pro-business, and the
new administration moved to liberalise currency controls
and remove export taxes on mined products.
Under the Agreement, the estimation of this mineral
resource and the making of expenditures exceeding
US$500,000 in connection with the Danglay project entitle
ECR to a 25% interest in Cordillera Tiger. Both conditions
have been satisfied, but the relevant shareholding has yet
to be issued, despite a resolution of Cordillera Tiger’s board
of directors authorising the issuance.
In December 2016, a site visit and review by three of the
Company’s Directors (including Ivor Jones, a professional
geologist, who has since resigned from the Board)
enabled the announcement of a JORC Code-compliant
Exploration Target for the El Abra and JV14 prospects,
along with details of a proposed drilling programme.
Further information and explanation regarding the SLM
project Exploration Targets and proposed drilling, details of
which were announced on 27 January 2017, is provided in
a technical report entitled ‘Exploration Target - Sierra de las
Minas’ which is available on ECR’s website.
The Company has begun investigating the possibility
of ‘spinning out’ the SLM project into a separate listed
company. This would provide ECR with a substantial
shareholding in that company, which would then be
responsible for financing further exploration at SLM.
Danglay gold project, Philippines
In late April 2013 ECR entered into an earn-in and joint
venture agreement (the “Agreement”) in relation to the
Danglay gold project in the Philippines. Cordillera Tiger
Gold Resources, Inc. (“Cordillera Tiger”) is a Philippine
corporation and the holder of the exploration permit (the
“EP”) which represents the Danglay project.
Activities under the Agreement commenced in December
2013 and ceased when the Earn-In Option (as that term
is defined in the Agreement) was terminated in August
2016. The Philippine mining industry is enduring a period
of significant political and regulatory upheaval, which has
been particularly intense and unpredictable since June
2016. In light of this, termination of the Earn-In Option was
considered a prudent step for the Company to take.
The Agreement gave ECR the exclusive right and option to
earn a 25% or 50% interest in Cordillera Tiger and thereby
in the Danglay project. Under the terms of the Agreement,
ECR was the operator of the Danglay project, through
Cordillera Tiger. The completion of various exploration
programmes generated valuable data which is relevant to
the assessment of the project’s economic potential.
In December 2015, the Company published an NI43-101
technical report (the “Report”) in relation to the Danglay
project. The Report also disclosed a target for further
exploration, as permitted by NI43-101. The Report supports
the disclosure on 5 November 2015 of an inferred mineral
resource estimate for oxide gold mineralisation at Danglay.
One of the delaying factors is a lawsuit which has been
filed in the Philippines against three members of the
Cordillera Tiger board. The lawsuit challenges, among other
things, the resolution approving the issuance of shares
in Cordillera Tiger to ECR. The plaintiff in the suit is Patric
Barry, a director of Cordillera Tiger. The Company considers
the lawsuit to be a transparent and unscrupulous attempt
to obstruct Cordillera Tiger’s performance of its contractual
obligations and deprive ECR of its rightful shareholding.
Renewal of the EP for a further two-year term was applied
for in September 2015, and in June 2016 the renewed
EP was issued to Cordillera Tiger for signature and return
to the Philippine authorities. The final renewed EP has
yet to be provided to Cordillera Tiger, and the status of
the renewal is unclear. Given the political and regulatory
uncertainty affecting the mining sector in the Philippines,
the delay is not unexpected.
The Danglay project remains attractive from a technical
standpoint, but due to the high level of political and
regulatory risk affecting the Philippine mining sector, only
limited efforts by ECR to enforce its rights in respect of
Cordillera Tiger have to date been considered commercially
justifiable.
However, the political climate for the minerals industry in
the Philippines appears on course to improve in future, and
the Directors are aware of the circumstances surrounding
the aforementioned litigation and consider that a favourable
outcome for the Company (which is not a party to the
litigation) is more likely than not.
Risks and Uncertainties
The Directors regularly review the risks and uncertainties to
which the Group is exposed and seek to ensure that these
risks and uncertainties are, as far as possible, minimised.
The Directors have identified the principal risks and
uncertainties facing the Group and these are set out below.
Exploration Risk
Mineral exploration is, by its nature, speculative, and as
mentioned earlier the number of such projects which
develop into mining operations is relatively low. There
is no certainty that the Group’s exploration projects can
be economically exploited and no certainty that this will
enhance shareholder value. If the Directors ultimately
decide that a prospect has no economic future and they
9
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Strategic Report continued
are unable to sell it on, the costs incurred to date would
be written off in the Consolidated Income Statement in
the year in which the decision to discontinue exploration
operations is made.
Development Risk
All mineral exploration and development projects may be
subject to delays and/or unforeseen difficulties arising from
bad weather, natural disasters, non-availability or delayed
availability of licences or permits, changes in the terms on
which key licences or permits are available, commissioning
of operations, and the raising of finance, among other
factors. The risk of delays and unforeseen difficulties is
mitigated when practical and legal to do so. However,
the risk remains that such factors may render a project
unfeasible, or not economically feasible.
Commodity Prices
Changes in the spot and forward prices of the relevant
mineral commodity can affect the economic viability of a
project at any stage in its life cycle.
Resource Risk
Mineral deposits are evaluated by their size, grade and by
other parameters, and mineral resources and reserves are
typically calculated in accordance with accepted industry
standards and codes. Nevertheless, there is always some
level of uncertainty in the underlying assumptions. The
Board keeps these assumptions under constant review and
adjusts the Group’s development strategy accordingly.
Mining & Processing Technical Risk
Variations can occur unexpectedly in the technical
parameters of a project and can considerably alter its
economic viability, despite the Directors taking as many
precautions (such as confirmatory drilling, metallurgical test
work and feasibility studies) as is sensible.
Environmental Risks
Changes in legislation and the risk of environmental
damage can give rise to unplanned environmental liabilities
or threaten the continuity of a project at any stage in its
life cycle. The environmental parameters of all projects are
considered carefully so as to minimise these risks.
Financing Risk
This arises when despite its best efforts the Group finds
itself unable to raise the requisite finance on its optimal
timescale, or at all. As a result, project development may
be either delayed or suspended pending the raising of
finance, and the lack thereof may threaten the rights of
the Group in the event the Group is unable to meet its
commitments.
The Directors aim to plan far enough ahead to ensure
an orderly timing of finance raising activities in order to
ensure, as far as practical, that the Group has sufficient
liquidity to enable projects to proceed as planned.
Partner Risks
Any joint venture arrangement contains an element of
counterparty risk, particularly as to the financial status of
the joint venture partner or to its level of participation in
the joint venture, and these issues can ultimately lead to
the failure of the joint venture. There is a need to maintain
good working relations with the Group’s joint venture
partners and to monitor their involvement and financial
condition on a regular basis.
Political & Regulatory Risk
This takes many forms and can exist in developed
countries (enhanced environmental requirements, changes
in taxation, etc.) as well as less developed countries
(civil unrest, government expropriation of mineral assets,
corruption etc.).
Internal Control & Risk Management
The Directors are responsible for the Company’s internal
control systems. Whilst no system can give absolute
assurance against material loss or misstatement, the
Group’s processes are designed, within the confines of
the limited number of personnel employed, to provide
reasonable assurance that issues are identified and dealt
with in a timely manner.
The on-going financial performance of the Group is
monitored regularly, risks are identified and where
necessary adjustments are made as early as is possible.
The Board, subject to the necessary shareholder authority,
regularly reviews capital investment, project acquisitions
and disposals, borrowing facilities (if any), insurance and
any guarantee arrangements.
Forward Looking Statements
This Annual Report & Accounts 2018 may include forward
looking statements. Such statements may be subject to
a number of known and unknown risks, uncertainties and
other factors that could cause actual results or events to
differ materially from current expectations. There can be no
assurance that such statements will prove to be accurate
and therefore actual results and future events could differ
materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance
on forward looking statements. Any forward looking
statements contained herein speak only as of the date
hereof (unless stated otherwise) and, except as may be
required by applicable laws or regulations (including the
AIM Rules for Companies), the Company and the Group
disclaim any obligation to update or modify such forward
looking statements as a result of new information, future
events or for any other reason.
10
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Corporate Governance
4. Risk management
Since September 2018, all AIM-listed companies have
been required to apply a recognised corporate governance
code. The Company has chosen the Quoted Companies
Alliance (QCA) Corporate Governance Code published in
April 2018 for this purpose. High standards of corporate
governance are a priority for the Board, and details of how
ECR addresses the key governance principles defined in
the QCA code are set out below, and on the Company’s
website in accordance with AIM Rule 26.
Deliver growth
1. Strategy and business model
ECR’s business model and strategy to deliver shareholder
value is set out in this Strategic Report, together with the
Company’s values and risk management approach.
The Company operates in the mineral exploration and
development sector, which is generally high risk but can
provide exceptionally high returns for shareholders. The
Company maintains a register of risks across a number
of categories including personnel, competition, finance,
environmental, political, technical and legal.
The risks are identified on an annual basis and discussed
with the auditors, and kept up to date with the aid of
regular discussions at Board level. For each risk the Board
estimates the potential impact and likelihood of adverse
events, and identifies mitigating strategies. This register is
reviewed periodically as the Company’s situation changes
and at a minimum annually to determine whether the
systems in place are effective or need updating.
Maintain a dynamic management framework
2. Understanding and meeting shareholder needs and
5. Board structure
expectations
The Company maintains a dedicated email address which
investors can use to contact the Company. This address is
prominently displayed on the Company’s website together
with its address and phone number.
Annual general meetings are held, which all members
have the right to attend, and during each annual general
meeting, time is set aside specifically to allow questions
from attending members to be addressed to the Board.
As the Company is too small to have a dedicated
investor relations department, the CEO is responsible for
reviewing all communications received from members and
determining the most appropriate response. In addition to
these passive measures, the CEO typically engages with
members through investor shows once or twice each year,
which seems to be effective.
3. Stakeholder and social responsibilities
In addition to its members, the Company recognises
that its main stakeholder groups are its employees,
consultants and contractors, and the communities and
governmental authorities where the Company and its
subsidiaries operate. Where necessary, the Company
dedicates significant time to understanding and acting
on the needs and requirements of each of these groups.
Board members assess the needs and requirements of
the Company’s stakeholders as and when they interact
with each stakeholder group, usually through meetings and
dialogue, and matters are then be raised at Board level for
appropriate action.
With regard to corporate social responsibility, the Board is
aware of the impact the activities of the Company and its
subsidiaries may have on the communities in which they
operate, and aims to ensure this impact is positive.
The Board currently comprises one executive director, one
independent non-executive director and one independent
non-executive Chairman. The Board meets at least
quarterly, and all current directors have attended all Board
meetings held in the current financial year (subject to his
being a director at that time). Under the Company’s articles
of association, each director must periodically offer himself
for re-election by vote of the members at the Company’s
annual general meeting.
The contracts of engagement for the Company’s non-
executive directors require that they devote such of their
time as is reasonably necessary to perform their duties.
In addition, they may provide paid consulting services in
respect of work going beyond the role of a non-executive
director.
The Company notes that best practice under the QCA code
is to have at least half the Board made up of independent
non-executive directors.
In addition, the Company notes that its Non-Executive
Chairman David Tang has been in post for more than one
year and the Board is satisfied as to his independence,
especially in light of the periodic requirement for all
directors to offer themselves for re-election, which offers
shareholders an opportunity to vote on their suitability.
During the past twelve months there have been four formal
board meetings and all directors in office at the relevant
time attended.
6. Board diversity and experience
The individuals who have been appointed to the Board have
been chosen because of the skills and experience they
offer. The members of the Board at the present time are
listed earlier in this annual report, together with an outline
of their experience, skills and personal qualities relevant to
the Company’s business.
11
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Strategic Report continued
The diverse experience and expertise of the directors
is intended to ensure that the Board has the skills and
capabilities to manage the Company for the benefit of
shareholders over the medium to long term.
The Company has no specific advisors to the board other
than its lawyers and AIM nominated adviser. Craig Brown
acts in the role of Company Secretary.
7. Board performance & evaluation
Evaluation of the performance of the Board has historically
been implemented in an informal manner. From 2019
however, the Board will formally review and consider the
performance of each director at or around the time of the
Company’s annual general meeting using a process which
is currently under development.
On an ongoing basis, Board members maintain a watching
brief to identify relevant internal and external candidates
who may be suitable additions to or backup for current
Board members, however the Board considers that the
Company is too small to have an internal succession plan
and that it would not be cost effective to maintain an
external candidate list prior to the need arising.
8. Corporate culture
The Board believes that the promotion of a corporate
culture based on sound ethical values and behaviours is
essential to maximise shareholder value in the medium to
long term. Adherence to these standards is a key factor
in the evaluation of performance within the Company,
including during annual performance reviews. In addition,
staff matters are a standing topic at every Board
meeting and the CEO reports on any notable examples
of behaviours that either align with or are at odds with
the Company’s stated values. The Board believes that
the Company’s culture encourages collaborative, ethical
behaviour which benefits employees and shareholders. The
Board further believes that all employees and consultants
worked in line with the Company’s values during the
financial year ended 30 September 2018 and since. This
has been assessed by the Board in the course of the day to
day management of the Company, which is feasible given
the relatively small size of the organisation.
9. Governance structures
Due to the size of the Company all strategic and major
commercial matters are reserved for the Board.
The key Board roles are as follows:
Chair: The primary responsibility of the Chair is to lead the
Board effectively and to oversee the adoption, delivery and
communication of the Company’s corporate governance
model. The Chair has sufficient separation from the day-to-
day business to be able to make independent decisions.
The Chair is also responsible for making sure that the Board
agenda concentrates on the key issues, both operational
and financial, with regular reviews of the Company’s
strategy and its overall implementation.
Chief Executive Officer (CEO): Charged with the
implementation of the strategy set by the Board. Works
with the Chair and non-executives in an open and
transparent way. Keeps the Chair and the Board as a whole
up-to-date with operational performance, risks and other
issues to ensure that the business remains aligned with the
strategy.
The Board has two committees. They are as follows:
Audit committee: The audit committee meets to consider
matters relating to the Company’s financial position and
financial reporting. The audit committee reviews the
independence and objectivity of the external auditors. The
committee reviews the independence and objectivity of the
external auditors, PKF Littlejohn LLP, as well as the amount
of non-audit work undertaken by them, to satisfy itself that
this will not compromise their independence. Details of
the fees paid to PKF Littlejohn LLP during each financial
year are given in the annual accounts. The audit committee
currently comprises David Tang (Non-Executive Chairman)
and Craig Brown (Chief Executive Officer).
Remuneration committee: The remuneration committee has
been established primarily to determine the remuneration,
terms and conditions of employment of the executive
directors of the Company. Any remuneration issues
concerning non-executive directors are also resolved by this
committee, although no director participates in decisions
that concern his own remuneration. The remuneration
committee comprises David Tang (Non-Executive Chairman)
and Samuel Garrett (Non-Executive Director).
Due to the nature of the size of the Company all major
operational decisions are reserved for the Board. The
appropriateness of the Company’s governance structures
will be reviewed as the Company evolves, and changes
made as necessary.
Build trust
10. Stakeholder communication
On the Company’s website shareholders can find all
historical regulatory announcements, notices of general
meetings, governance-related materials, interim reports
and annual reports. Annual reports and notices of general
meetings are posted directly to all registered shareholders,
and the outcome of general meetings is disclosed in a clear
and transparent manner via regulatory announcements.
The Company’s website allows shareholders and other
interested parties to sign up to a mailing list to enable them
to directly receive regulatory and other company releases
by email. As described earlier, the Company also maintains
email and phone contacts which shareholders can use to
make enquiries or requests.
12
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Corporate Responsibility
Suppliers & Contractors
The Board regularly reviews the significance of social,
environmental and ethical matters affecting the Group’s
operations. It considers that the Group is not yet at a stage
where a specific corporate social responsibility policy is
required, in view of the limited number of stakeholders,
other than shareholders. Instead the Board protects the
Group’s interests and those of its stakeholders through
individual policies and through ethical and transparent
business dealings.
The Board recognises the importance of maintaining the
goodwill of its contractors, consultants and suppliers, and
encourages this through fair dealings. The Group has a
prompt payment policy and seeks to ensure all liabilities are
settled within the terms agreed with that supplier.
Health & Safety
The activities of the Group are carried out in accordance
with all applicable laws on health & safety.
The Board has adopted an Anti-Bribery and Corruption
Policy.
This Strategic Report was approved by the Directors on
28 March 2019.
Craig Brown
Director and Chief Executive Officer
Shareholders
The Board seeks to protect shareholders’ interests at
all times by operating in accordance with the corporate
governance arrangements set out above, and by ensuring
that each Board decision is taken with due regard to the
interests of shareholders as a whole. In addition to making
appropriate news releases and publishing financial reports,
the Directors encourage communication with shareholders
at annual general meetings and by participating in investor
presentations, Q&A sessions and via social media.
Environment
Mineral exploration and development has the potential to
adversely impact the environment in which it takes place.
The Group takes its environmental responsibilities seriously
and the environmental parameters of the activities of the
Group are considered carefully so as to minimise the risk of
adverse environmental effects.
Human Rights
The activities of the Group are carried out in accordance
with all applicable laws on human rights and with genuine
moral concern for all stakeholders.
Employees
The Group seeks to remunerate its employees fairly,
offers flexible working arrangements where practical and
encourages employees to gain exposure to all aspects
of the Group’s business. The Group gives full and fair
consideration to applications for employment received
regardless of age, gender, colour, ethnicity, disability,
nationality, religious beliefs, transgender status or sexual
orientation. It considers the interests of employees
when making decisions and welcomes suggestions
from employees which have the potential to improve the
Group’s performance.
13
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Report of the Directors
For the year ended 30 September 2018
Principal Activities
A full review of significant matters, including likely future
developments, is contained in the Chairman’s Statement,
Chief Executive Officer’s Report and the Strategic Report.
Details of significant events after the reporting date are
also disclosed in Note 22 to the financial statements.
Financial Risk Management Objectives and Policies
The Group does not presently hold any forward or hedge
positions in either currency or minerals. Currently these are
not deemed necessary, but this is reviewed from time to
time. There is inherent risk in operating between different
currencies, principally GBP, AUD and USD, and the Board
monitors and reviews this exposure on a regular basis.
The Board recognises the Group’s exposure to liquidity
risk and that the Group’s ability to continue its operations
is dependent on it having or acquiring sufficient cash
resources. The Board continually monitors the Group’s
cash position and may realise all or part of the Group’s
investments in order to maintain the ability of the Group to
meet its obligations as they fall due.
The location of the Group’s principal activities is currently in
Australia and its corporate base is in the United Kingdom.
These locations are considered stable with advanced
economic and legal infrastructures.
Further details of the Group’s financial risk management
objectives and policies are set out in Note 19 to the
financial statements.
Position of the Company and Going Concern
At the date of this report the Group’s financial position
is stable. As explained herein, the financial statements
continue to be prepared on a going concern basis.
Based on a review of the Group’s budgets and cash flow
forecasts and the expected sources of financing available,
the Directors are satisfied that the Group and Company
have sufficient resources to continue their operations and
to meet their commitments for the next at least the next
12 months. The Directors have considered the present
economic and financial climate as specifically pertaining
to the Company and its peer group and are confident in
the ability of the Company to raise funding as required to
sustain and develop the operations of the Group. Means of
raising finance potentially available to the Company include
the issue of equity and the sale of assets.
Reviews of operations and business developments are
provided in the reports of the Chairman and the Chief
Executive Officer, the Strategic Report, this Report of the
Directors and within the detail of the financial statements.
Therein are set out certain forward looking statements
that have been made by the Directors in good faith. By
the nature of these statements there can be no certainty
that any or all predictions will be met. Such statements
may be subject to a number of known and unknown
risks, uncertainties and other factors that could cause
actual results or events to differ materially from current
expectations. There can be no assurance that such
statements will prove to be accurate and therefore actual
results and future events could differ materially from those
anticipated in such statements.
Accordingly, readers should not place undue reliance
on forward looking statements. Any forward looking
statements contained herein speak only as of the date
hereof (unless stated otherwise) and, except as may
be required by applicable laws or regulations (including
the AIM Rules for Companies), the Company disclaims
any obligation to update or modify such forward looking
statements as a result of new information, future events or
for any other reason.
The Impact of Brexit on the Group
The Board has considered the extent of solvency, liquidity
and other risks and uncertainties arising from the proposed
withdrawal of the United Kingdom from the European
Union (“Brexit”) that may threaten the long term viability
of the Group. The Board does not envisage Brexit having a
significant impact on the Group, based on the geographical
location of the Group’s current exploration projects and
investor base.
The Board will continue to follow the development of the
UK’s negotiations with the European Union and evaluate
the impact on the Group accordingly.
Dividends
The results for the year are set out in the Consolidated
Income Statement. No dividend is proposed in respect of
the year (2017: nil). The Group loss for the year of £550,018
(2017 loss of £511,124) has been taken to reserves
together with the comprehensive income and expenses.
Directors
The Directors who served during the year and to the date
of this report were:
Weili (David) Tang
Craig William Brown
Ivor William Osborne Jones (appointed 8 November
2016, resigned effective 30 November 2017)
Christian Gabriel St. John-Dennis (resigned effective 4
July 2018)
Samuel James Melville Garrett (appointed 22 February
2019)
14
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Under the Company’s Articles of Association, at every
annual general meeting of the Company, any Director:
•
•
•
who has been appointed by the Board since the date of
the last annual general meeting; or
who held office at the time of the two preceding annual
general meetings and did not retire at either of them; or
who has held office with the Company as a non–
executive Director (that is, he has not been employed
by the Company or held executive office) for a
continuous period of nine years or more at the date of
the meeting:
shall retire from office and may offer himself for election/
re–election by the members.
Total Directors’ emoluments are disclosed in Note 6 to
the financial statements and details of the share options
granted to Directors are disclosed below.
Share Capital and Substantial Share Interests
On 22 March 2019, the Company was aware of the
following holdings of 3% or more in Company’s issued
ordinary share capital of 445,840,783 ordinary shares of
£0.00001 each.
Registered Shareholder
Number
%
of shares Holding
Jim Nominees Ltd
Interactive Investor Services Nominees
Limited
Share Nominees Ltd
Barclays Direct Investing Nominees Ltd
Hargreaves Lansdown (Nominees) Limited
Interactive Investor Services Nominees Limited
HSDL Nominees Limited
Hargreaves Lansdown (Nominees) Limited
<15942>
124,587,741
27.94
53,258,965
49,263,888
11.95
11.05
29,505,358
6.62
25,464,114
5.71
21,576,270
21,255,160
4.84
4.77
16,210,620
3.64
The Directors will comply with Rule 21 of the AIM rules
and the Market Abuse Regulation relating to Directors’
dealings and will take all reasonable steps to ensure
compliance by the Group’s applicable employees.
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the annual
report and the financial statements in accordance with
applicable law and regulations.
Directors’ Interests
Directors who held office at 30 September 2018 held the
following beneficial interests, either directly or indirectly
(including interests held by spouses, minor children or
associated parties) in the ordinary shares of the Company.
29 March 30 September 30 September
2017
no. of shares no. of shares no. of shares
2019
2018
2,977,842
C W Brown
I W O Jones1
–
C G St. John-Dennis2
–
Weili (David) Tang 1,428,572
1,549,271
–
–
–
1,549,271
1,000,000
–
–
4,406,414
1,549,271
2,549,271
1 I W O Jones was appointed on 8 November 2016 and resigned
effective 30 November 2017
2 C G St. John-Dennis was appointed on 12 October 2016 and resigned
effective 4 July 2018
Additionally, Directors of the Company who held office
at 30 September 2018 held the following share options
granted under the Company’s unapproved share option
scheme:
Options
Issued
Date
Issued
Expiry Exercise
Price
Date
C W Brown 4,076,984 27/02/2017 27/02/2022 £0.01725
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the
Directors have elected to prepare the Group and Parent
Company financial statements in accordance with
International Financial Reporting Standards (“IFRSs”) as
adopted by the European Union and, as regards the Parent
Company financial statements, as applied in accordance
with the provisions of the Companies Act 2006. 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
the Company and of the profit or loss of the Group for
that period. In preparing these financial statements the
Directors are required to:
•
•
•
•
select suitable accounting policies and then apply them
consistently;
make judgements and accounting estimates that are
reasonable and prudent;
state whether applicable IFRSs as adopted by the
European Union have been followed subject to any
material departures disclosed and explained in the
financial reports;
prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Group and Company will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s and Group’s transactions and disclose with
reasonable accuracy at any time the financial position of
the Company and the Group and enable them to ensure
that the financial statements comply with the Companies
15
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Report of the Directors continued
Act 2006. They are also responsible for safeguarding the
assets of the Company and the Group and hence for taking
reasonable steps for the prevention and detection of fraud
and other irregularities.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the Company’s website. Legislation in the United
Kingdom governing the preparation and dissemination of
the financial statements may differ from legislation in other
jurisdictions.
Directors and Officers’ Liability Insurance
The Company had in force during the year and has in force
at the date of this report a qualifying indemnity in favour of
its Directors against the financial exposure that they may
incur in the course of their professional duties as Directors
and officers of the Company and/or its subsidiaries.
Statement on Disclosure of Information to Auditors
Having made the requisite enquiries and in the case of
each of the Directors who are Directors of the Company at
the date when this report is approved:
•
•
so far as they are individually aware, there is no
relevant audit information (as defined by Section 418
of the Companies Act 2006) of which the Company’s
auditors are unaware; and
each of the Directors has taken all the steps that they
should 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 the information.
Auditor
PKF Littlejohn LLP has expressed its willingness to
continue in office as auditor of the Company and a
resolution to confirm the appointment will be proposed at
the forthcoming annual general meeting.
Annual General Meeting
The annual general meeting of the Company will be held at
9.00 am on 23 April 2019 at the offices of Charles Russell
Speechlys LLP, 5 Fleet Place, London, EC4M 7RD, United
Kingdom. Notice of the annual general meeting is enclosed.
This report was approved by the Board on 28 March 2019.
By order of the Board
Craig Brown
Director and Chief Executive Officer
16
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Independent Auditor’s Report
For the year ended 30 September 2018
Independent Auditor’s Report to the Members of ECR
Minerals Plc
Opinion
We have audited the financial statements of ECR Minerals
Plc (the ‘parent company’) and its subsidiaries (the ‘group’)
for the year ended 30 September 2018 which comprise
the Consolidated Income Statement, the Consolidated
Statement of Comprehensive Income, the Consolidated
and Parent Company Statement 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 a summary of significant accounting
policies. The financial reporting framework that has
been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as
adopted by the European Union 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 30 September 2018 and of the group’s and parent
company’s loss for the year then ended;
the group financial statements have been properly
prepared in accordance with IFRSs as adopted by the
European Union;
the parent company financial statements have been
properly prepared in accordance with IFRSs as adopted
by the European Union 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
We have nothing to report in respect of the following
matters in relation to which the ISAs (UK) require us to
report to you where:
•
•
the directors’ use of the going concern basis
of accounting in the preparation of the financial
statements is not appropriate; or
the directors have not disclosed in the financial
statements any identified material uncertainties that
may cast significant doubt about the group’s or the
parent company’s ability to continue to adopt the
going concern basis of accounting for a period of at
least twelve months from the date when the financial
statements are authorised for issue.
Our application of materiality
The scope of our audit was influenced by our application
of materiality. The quantitative and qualitative thresholds
for materiality determine the scope of our audit and the
nature, timing and extent of our audit procedures. Group
materiality was £60,000 based upon gross assets and
the loss before tax. The Parent Company materiality was
£55,000 based upon gross assets and the result for the
year. For each component in the scope of our group audit,
we allocated a materiality that is either equal to or less than
our overall group materiality.
An overview of the scope of our audit
As part of designing our audit, we determined materiality
and assessed the risk of material misstatement in the
financial statements. In particular, we looked at areas
involving significant accounting estimates and judgement
by the Directors and considered future events that are
inherently uncertain. As in all of our audits, we also
addressed the risk of management override of internal
controls, including among other matters consideration of
whether there was evidence of bias that represented a
risk of material misstatement due to fraud. The Australian
and Argentinian subsidiary undertakings represent the
principal business units within the Group, upon which we
performed audit procedures directly on significant accounts
based on size or risk profile to the Group. A full scope audit
was undertaken on the financial statements of the Parent
Company.
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.
This matter was 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 this matter.
17
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Independent Auditor’s Report continued
Key Audit Matter
Recoverability of intangible assets – exploration and
development costs (refer note 10)
The carrying value of intangible assets as at 30 September
2018 is £2,859,474 which comprises exploration and
development projects in Australia, Argentina and the
Philippines. The carrying value of these intangible assets
are tested annually for impairment. There is a risk that the
carrying value of these early stage projects is impaired
and that the exploration and development expenditure
capitalised during the year is not in accordance with IFRS 6.
How the scope of our audit responded to the key audit
matter
The carrying value of all early stage exploration and
development projects were assessed and tested in
accordance with the following criteria:
•
•
•
The Group holds good title to the licence areas;
The Group has planned and budgeted for further
expenditure for mineral resources in the licence areas;
and
Exploration and development work undertaken to date
has indicated the existence of commercially viable
quantities of mineral resource.
We undertook substantive testing on capitalised
expenditure during the year to ensure it satisfied the
criteria under IFRS 6.
We discussed with management the scope of their future
budgeted and planned expenditure on each licence area.
As disclosed in note 10 to the financial statements, the
Group has not formally acquired title to its 25% interest in
Cordillera Tiger Gold Resources, Inc (“Cordillera”) which
is the holder of the exploration permit for the Danglay
gold project in the Philippines. The conditions for the
earn-in have been satisfied but the relevant shareholding
has yet to be issued, despite the Board of Cordillera
authorising the issue. In addition, the exploration permit
for the Danglay gold project held by Cordillera expired
on 30 September 2015. Cordillera is currently waiting
for the Philippine authority to formally grant its renewal
application. This indicates the existence of a material
uncertainty over the recoverability of the carrying value of
the Danglay gold project, which amounted to £1,176,729
as at 30 September 2018.
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. 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. In connection
with our audit of the financial statements, our responsibility
is to read the other information and, in doing so, consider
whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in
the audit or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent
material misstatements, we are required to determine
whether there is a material misstatement in the financial
statements or a material misstatement of the other
information. If, based on the work we have performed, we
conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies
Act 2006
In our opinion, based on the work undertaken in the course
of the audit:
•
•
the information given in the strategic report and the
directors’ report for the financial year for which the
financial statements are prepared is consistent with the
financial statements; and
the strategic report and the directors’ report have
been prepared in accordance with applicable legal
requirements.
18
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 A further description of our responsibilities for the audit
of the financial statements is located on the Financial
Reporting Council’s website at: http://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 Compa-
nies 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
28 March 2019
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:
•
•
•
•
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.
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.
19
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Consolidated Income Statement
For the year ended 30 September 2018
ECR Minerals plc company no. 5079979
Continuing operations
Other administrative expenses
Currency exchange differences
Total administrative expenses
Operating loss
Loss on disposal of investment
Fair value movements - available for sale financial asset
Financial income
Financial expense
Finance income and costs
Loss for the year before taxation
Income tax
Loss for the year from continuing operations
Year ended
30 September 2018
£
Year ended
30 September 2017
£
Note
(544,521)
(6,912)
(551,433)
(551,433)
–
(971)
(552,404)
1,386
1,000
2,386
(550,018)
–
(550,018)
(509,545)
(3,186)
(512,731)
(512,731)
(1)
1,255
(511,477)
353
–
353
(511,124)
–
(511,124)
3
9
7
5
Loss for the year - all attributable to owners of the parent
(550,018)
(511,124)
Earnings per share - basic and diluted
On continuing operations
4
(0.21)p
(0.31)p
The Company has elected to take the exemption under section 408 of the Companies Act 2006 from presenting the parent
company profit and loss account. The loss for the parent company for the year was £373,149 (2017: £208,774 loss).
The notes on pages 26 to 41 are an integral part of these financial statements.
20
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Consolidated Statement of Comprehensive Income
For the year ended 30 September 2018
ECR Minerals plc company no. 5079979
Year ended
30 September 2018
£
Year ended
30 September 2017
£
Loss for the year
(550,018)
(511,124)
Items that may be reclassified subsequently to profit or loss
Loss on exchange translation
Other comprehensive expense for the year
Total comprehensive expense for the year
Attributable to:-
Owners of the parent
(171,442)
(171,442)
(721,460)
(51,524)
(51,524)
(562,648)
(721,460)
(562,648)
The notes on pages 26 to 41 are an integral part of these financial statements.
21
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Consolidated & Company Statement of Financial Position
At 30 September 2018
ECR Minerals plc company no. 5079979
Assets
Non-current assets
Property, plant and equipment
Investments in subsidiaries
Intangible assets
Other receivables
Current assets
Trade and other receivables
Available for sale financial assets
Cash and cash equivalents
Total assets
Current liabilities
Trade and other payables
Total liabilities
Net assets
Equity attributable to owners of the parent
Share capital
Share premium
Exchange reserve
Other reserves
Retained losses
Group
Company
30 September
2018
£
30 September
2017
£
30 September
2018
£
30 September
2017
£
Note
8
9
10
11
11
9
12
14
13
13
3,033
–
2,859,474
–
8,694
–
2,668,747
–
1,764
852,728
2,256,309
538,494
7,020
852,170
2,180,312
240,970
2,862,507
2,677,441
3,649,295
3,280,472
79,413
21,299
781,142
54,888
22,269
1,082,994
471,670
21,299
749,025
281,901
22,269
1,046,787
881,854
1,160,151
1,241,994
1,350,957
3,744,361
3,837,592
4,891,289
4,631,429
92,816
92,816
92,816
102,367
102,367
102,367
75,662
75,662
75,662
80,432
80,432
80,432
3,651,545
3,735,225
4,815,627
4,550,997
11,283,756
44,460,171
(389,501)
1,381,998
(53,084,879)
11,282,812
43,823,335
(218,059)
1,381,998
(52,534,860)
11,283,756
44,460,171
–
1,381,998
(52,310,298)
11,282,812
43,823,335
–
1,381,998
(51,937,148)
Total equity
3,651,545
3,735,225
4,815,627
4,550,997
The notes on pages 26 to 41 are an integral part of these financial statements. The financial statements were approved and
authorised for issue by the Directors on 28 March 2019 and were signed on its behalf by:
Weili (David) Tang
Non–Executive Chairman
Craig Brown
Director & Chief Executive Officer
22
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Consolidated Statement of Changes in Equity
For the year ended 30 September 2018
ECR Minerals plc company no. 5079979
Share
capital
(Note 13)
£
Share
premium
(Note 13)
£
Exchange
reserve
Other
reserves
Retained
reserves
£
£
£
Balance at 30 September 2016
Loss for the year
Loss on exchange translation
11,281,628
–
–
42,441,553
–
–
(166,535)
–
(51,524)
1,147,717
–
–
(52,023,736)
(511,124)
–
Total comprehensive expense
Shares issued
Share issue costs
Share based payments
Shares issued in payment of creditors
–
1,109
–
–
75
–
1,552,455
(84,878)
(166,739)
80,944
(51,524)
–
–
–
–
–
–
–
234,281
–
(511,124)
–
–
–
–
Total
£
2,680,627
(511,124)
(51,524)
(562,648)
1,553,564
(84,878)
67,542
81,019
Total transactions with owners,
recognised directly in equity
1,184
1,381,782
–
234,281
–
1,617,247
Balance at 30 September 2017
Loss for the year
Gain/loss on exchange translation
11,282,812
–
–
43,823,335
–
–
(218,059)
–
(171,442)
1,381,998
–
–
(52,534,860)
(550,018)
–
3,735,226
(550,018)
(171,442)
–
(171,442)
Total comprehensive expense
Shares issued
Share issue costs
Warrants issued in lieu of finance cost
Shares issued in payment of creditors
–
929
-
–
15
649,071
(27,220)
–
14,985
Total transactions with owners,
recognised directly in equity
944
636,836
–
–
–
–
–
–
–
–
–
–
–
(550,018)
(721,460)
–
–
–
–
–
650,000
(27,220)
15,000
637,780
Balance at 30 September 2018 11,283,756
44,460,171
(389,501)
1,381,998
(53,084,878)
3,651,546
The notes on pages 26 to 41 are an integral part of these financial statements.
23
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Company Statement of Changes in Equity
For the year ended 30 September 2018
ECR Minerals plc company no. 5079979
Balance at 30 September 2016
Loss for the year
Total comprehensive expense
Shares issued
Share issue costs
Share based payments
Shares issued in payment of creditors
Total transactions with owners, recognised
directly in equity
Balance at 30 September 2017
Loss for the year
Total comprehensive expense
Shares issued
Share issue costs
Shares issued in payment of creditors
Total transactions with owners, recognised
directly in equity
Share
capital
(Note 13)
£
Share
premium
(Note 13)
£
Other
reserves
Retained
reserves
£
£
Total
£
11,281,628
–
42,441,553
–
–
1,109
–
–
75
–
1,552,455
(84,878)
(166,739)
80,944
1,147,717
–
–
–
–
234,281
–
(51,728,374)
(208,774)
3,142,524
(208,774)
(208,774)
(208,774)
–
–
–
–
1,553,564
(84,878)
67,542
81,019
1,184
1,381,782
234,281
–
1,617,247
11,282,812
43,823,335
1,381,998
–
929
–
15
–
649,071
(27,220)
14,985
944
636,836
–
–
–
–
–
(51,937,148)
(373,149)
4,550,997
(373,149)
(373,149)
(373,149)
–
–
–
650,000
(27,220)
15,000
–
637,780
Balance at 30 September 2018
11,283,756
44,460,171
1,381,998
(52,310,297)
4,815,628
The notes on pages 26 to 41 are an integral part of these financial statements.
24
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Consolidated & Company Cash Flow Statement
For the year ended 30 September 2018
ECR Minerals plc company no. 5079979
Group
Company
Year ended
30 September
2018
£
Year ended
30 September
2017
£
Year ended
30 September
2018
£
Year ended
30 September
2017
£
Note
Net cash flow used in operations
21
(563,850)
(569,016)
(547,730)
(511,307)
Investing activities
Purchase of property, plant & equipment
Increase in exploration assets
Investment in subsidiaries
Loan to subsidiary
Interest income
10
–
(302,794)
–
–
1,386
(6,174)
(231,140)
–
–
353
–
(75,998)
(558)
(297,524)
1,268
(4,082)
(104,209)
(112,070)
(133,629)
233
Net cash used in investing activities
(301,408)
(236,961)
(372,812)
(353,757)
Financing activities
Proceeds from issue of share capital
Net cash from financing activities
622,780
1,468,686
622,780
1,468,686
622,780
1,468,686
622,780
1,468,686
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Effect of changes in foreign exchange rates
(242,478)
1,082,994
(59,374)
662,709
471,809
(51,524)
(297,762)
1,046,787
–
603,622
443,165
–
Cash and cash equivalents at end of the year
12
781,142
1,082,994
749,025
1,046,787
Non-cash transactions:
1. Settlement of creditors of £15,000 (2017: £80,994) with ordinary shares.
The notes on pages 26 to 41 are an integral part of these financial statements.
25
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements
For the year ended 30 September 2018
1 General information
The Company and the Group operated mineral exploration
and development projects. The Group’s principal interests are
located in Argentina, the Philippines and Australia.
The Company is a public limited company incorporated and
domiciled in England. The registered office of the Company
and its principal place of business is Unit 117, Chester House,
81-83 Fulham High Street, Fulham Green, London SW6 3JA.
The Company is listed on the Alternative Investment Market
(AIM) of the London Stock Exchange.
2 Accounting policies
Overall considerations
The principal accounting policies that have been used in the
preparation of these consolidated financial statements are set
out below. The policies have been consistently applied unless
otherwise stated.
Basis of preparation
The financial statements of both the Group and the Parent
Company have been prepared in accordance with International
Financial Reporting Standards (IFRSs) and Interpretations
issued by the IFRS Interpretations Committee (IFRIC) as
adopted by the European Union and with those parts of the
Companies Act 2006 applicable to companies reporting under
IFRS. These are the standards, subsequent amendments and
related interpretations issued and adopted by the International
Accounting Standard Board (IASB) that have been endorsed
by the European Union at the year end. The consolidated
financial statements have been prepared under the historical
cost convention, as modified by the revaluation of certain
financial instruments. The Directors have taken advantage of
the exemption available under Section 408 of the Companies
Act 2006 and have not prepared an Income Statement or a
Statement of Comprehensive Income for the Company alone.
The Group and Parent Company financial statements have
been prepared on a going concern basis as explained in the
Directors’ Report on page 15.
New accounting standards and interpretations
Effective during the year
During the year the Group has adopted the following standards
and amendments:
• Annual Improvements to IFRSs 2014–2016 Cycle
•
Amendments to IAS 12: Recognition of Deferred Tax
Assets for Unrealised Losses
• Amendments to IAS 7: Disclosure Initiative
The adoption of these standards and amendments did not
have any impact on the financial position or performance of the
Group.
Not yet effective
At the date of authorisation of these Group Financial
Statements and the Parent Company Financial Statements, the
following Standards, amendments and interpretations were
endorsed by the EU but not yet effective:
26
•
•
•
•
•
•
•
•
IFRS 15 Revenue from Contracts with Customers including
amendments to IFRS 15
Clarifications to IFRS 15 Revenue from Contracts with
Customers
IFRS 9 Financial Instruments
IFRS 16 Leases
Amendments to IFRS 2: Classification and Measurement
of Share-based Payment Transactions
IFRIC Interpretation 22 Foreign Currency Transactions and
Advance Consideration
IFRIC 23 Uncertainty over Income Tax Treatments
Amendments to IAS 28 Long-term Interests in Associates
and Joint Ventures
In addition to the above there are also the following standards
and amendments that have not yet been endorsed by the EU:
• Annual Improvements to IFRS Standards 2015-2017 Cycle
• Amendments to IFRS 3 Business Combinations
• Amendments to IAS 1 and IAS 8 Definition of Material
The Group intends to adopt these standards when they
become effective. The introduction of these new standards
and amendments is not expected to have a material impact on
the Group or Parent Company.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and two of its subsidiaries made
up to 30 September 2018. Subsidiary undertakings acquired
during the period are recorded under the acquisition method
of accounting and their results consolidated from the date of
acquisition, being the date on which the Company obtains
control, and continue to be consolidated until the date such
control ceases.
The Group controls an entity when the Group is exposed to,
or has rights to, variable returns from its involvement with the
entity and has the ability to affect those returns through its
power over the entity.
Going concern
It is the prime responsibility of the Board to ensure the Group
and Company remains a going concern. At 30 September
2018, the Group had cash and cash equivalents of £781,142
and no borrowings. The Group’s financial projections and cash
flow forecasts covering a period of at least twelve months
from the date of approval of these financial statements show
that the Group will have sufficient available funds in order
to meet its contracted and committed expenditure. Further
details are included in Note 19 to the financial statements.
The Directors are confident in the ability of the Group to raise
additional funding, if required, from the issue of equity and/or
the sale of assets.
Based on their assessment of the financial position, the
Directors have a reasonable expectation that the Group and
Company will be able to continue in operational existence for
the next 12 months and continue to adopt the going concern
basis of accounting in preparing these Financial Statements.
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Cash and cash equivalents
Cash includes petty cash and cash held in current bank
accounts. Cash equivalents include short–term investments
that are readily convertible to known amounts of cash and
which are subject to insignificant risk of changes in value.
Property, plant and equipment
Property, plant and equipment are stated at cost, less
accumulated depreciation and any provision for impairment
losses.
Depreciation is charged on each part of an item of property,
plant and equipment so as to write off the cost of assets less
the residual value over their estimated useful lives, using the
straight–line method. Depreciation is charged to the income
statement. The estimated useful lives are as follows:
Office equipment
Furniture and fittings
Machinery and equipment
3 years
5 years
5 years
Expenses incurred in respect of the maintenance and
repair of property, plant and equipment are charged against
income when incurred. Refurbishments and improvements
expenditure, where the benefit is expected to be long lasting,
is capitalised as part of the appropriate asset.
An item of property, plant and equipment ceases to be
recognised upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or loss arising
on cessation of recognition of the asset (calculated as the
difference between the net disposal proceeds and the carrying
amount of the asset) is included in the income statement in the
year the asset ceases to be recognised.
Exploration and development costs
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. 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 in the period in which the event occurs. Where the
Group maintains an interest in a project, but the value of the
project is considered to be impaired, a provision against the
relevant capitalised costs will be raised.
Intangible exploration assets are not subject to amortisation
and are tested annually for impairment.
Provisions
A provision is recognised in the Statement of Financial
Position when the Group or Company has a present legal or
constructive obligation as a result of a past event, and it is
probable that an outflow of economic benefits will be required
to settle the obligation. If the effect is material, provisions are
determined by discounting the expected future cash flows at
a pre–tax rate that reflects current market assessments of the
time value of money and, where appropriate, the risks specific
to the liability.
Leased assets
In accordance with IAS 17, leases in terms of which the Group
or Company assumes substantially all the risks and rewards of
ownership are classified as finance leases. All other leases are
regarded as operating leases and the payments made under
them are charged to the income statement on a straight line
basis over the lease term.
Taxation
There is no current tax payable in view of the losses to date.
Deferred income taxes are calculated using the Statement of
Financial Position 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
and joint ventures is not provided if reversal of these temporary
differences can be controlled by the Company 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 Company 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
at the Statement of Financial Position date.
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.
Changes in deferred tax assets or liabilities are recognised as
a component of tax expense in the income statement, except
where they relate to items that are charged or credited directly
to equity, in which case the related current or deferred tax is
also charged or credited directly to equity.
Impairment testing
Individual assets are tested for impairment whenever events or
changes in circumstances indicate that the carrying amount of
an asset may exceed its recoverable amount, being the higher
of net realisable value and value in use. Any such excess of
carrying value over recoverable amount or value in use is taken
as a debit to the income statement.
Investments in subsidiaries
Subsidiaries are entities controlled by the Group. The Group
controls an entity when it is exposed to, or has rights to,
variable returns from its involvement with the entity and has
the ability to affect those returns through its power over the
entity.
27
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
The investments in subsidiaries held by the Company
are valued at cost less any provision for impairment that
is considered to have occurred, the resultant loss being
recognised in the income statement.
Equity
Equity comprises the following:
•
•
•
•
•
“Share capital” represents the nominal value of equity
shares, both ordinary and deferred.
“Share premium” represents the excess over nominal
value of the fair value of consideration received for equity
shares, net of expenses of the share issues.
“Other reserves” represent the fair values of share options
and warrants issued.
“Retained reserves” include all current and prior year
results, including fair value adjustments on available for
sale financial assets, as disclosed in the consolidated
statement of comprehensive income.
“Exchange reserve” includes the amounts described
in more detail in the following note on foreign currency
below.
Foreign currency translation
The consolidated financial statements are presented in pounds
sterling which is the functional and presentational currency
representing the primary economic environment of the Group.
Foreign currency transactions are translated into the respective
functional currencies of the Company and its subsidiaries using
the exchange rates prevailing at the date of the transaction
or at an average rate where it is not practicable to translate
individual transactions. Foreign exchange gains and losses are
recognised in the income statement.
Monetary assets and liabilities denominated in a foreign
currency are translated at the rates ruling at the Statement of
Financial Position date.
The assets and liabilities of the Group’s foreign operations
are translated at exchange rates ruling at the Statement
of Financial Position date. Income and expense items are
translated at the average rates for the period. Exchange
differences are classified as equity and transferred to the
Group’s exchange reserve. Such differences are recognised in
the income statement in the periods in which the operation is
disposed of.
Share–based payments
The Company operates equity–settled share–based
remuneration plans for the remuneration of some of its
employees. The Company awards share options to certain
Company Directors and employees to acquire shares of the
Company. Additionally, the Company has issued warrants to
providers of loan finance.
All goods and services received in exchange for the grant of
any share–based payment are measured at their fair values.
Where employees are rewarded using share–based payments,
the fair values of employees’ services are determined indirectly
by reference to the fair value of the instrument granted to the
employee.
The fair value is appraised at the grant date and excludes
the impact of non–market vesting conditions. Fair value
is measured by use of the Black Scholes model. The
expected life used in the model has been adjusted,
based on management’s best estimate, for the effects of
non–transferability, exercise restrictions, and behavioural
considerations.
All equity–settled share–based payments are ultimately
recognised as an expense in the income statement with a
corresponding credit to “other reserves”.
If vesting periods or other non–market vesting conditions
apply, the expense is allocated over the vesting period, based
on the best available estimate of the number of share options
expected to vest. Estimates are subsequently revised if there
is any indication that the number of share options expected
to vest differs from previous estimates. Any cumulative
adjustment prior to vesting is recognised in the current period.
No adjustment is made to any expense recognised in prior
years if share options ultimately exercised are different to that
estimated on vesting.
Upon exercise of share options the proceeds received net of
attributable transaction costs are credited to share capital and,
where appropriate, share premium.
A gain or loss is recognised in profit or loss when a financial
liability is settled through the issuance of the Company’s own
equity instruments. The amount of the gain or loss is calculated
as the difference between the carrying value of the financial
liability extinguished and the fair value of the equity instrument
issued.
Financial instruments
The Group’s financial assets comprise cash and cash
equivalents, investments and loans and receivables. Financial
assets are assigned to the respective categories on initial
recognition, depending on the purpose for which they were
acquired. This designation is re–evaluated at every reporting
date at which a choice of classification or accounting treatment
is available.
The Group’s loans, investments and receivables are
non–derivative financial assets with fixed or determinable
payments that are not quoted in an active market. Loans and
receivables are measured at fair value on initial recognition.
After initial recognition they are measured at amortised cost
using the effective interest rate method, less any provision
for impairment. Any change in their value is recognised in
profit or loss. The Group’s receivables fall into this category of
financial instruments. Discounting is omitted where the effect
of discounting is immaterial. All receivables are considered for
impairment on a case–by–case basis when they are past due
at the Statement of Financial Position date or when objective
evidence is received that a specific counterparty will default.
Investments that are held as available for sale financial
assets are financial assets that are not classified in any other
categories. After initial recognition, available for sale financial
assets are measured at fair value. Any gains or losses from
changes in the fair value of the financial asset are recognised in
28
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Critical accounting estimates and judgements
The preparation of financial statements in conformity with
IFRSs requires management to make judgements, estimates
and assumptions that affect the application of policies and
reported amounts of assets and liabilities, income and
expenses. The estimates and associated assumptions are
based on historical experience and various other factors that
are believed to be reasonable under the circumstances, the
results of which form the basis of making the judgements
about carrying values of assets and liabilities that are not
readily apparent from other sources. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on
an on–going basis. Revisions to accounting estimates are
recognised in the year in which the estimate is revised if the
revision affects only that year or in the year of the revision
and future years if the revision affects both current and future
years.
The most critical accounting policies and estimates in
determining the financial condition and results of the Group are
those requiring the greater degree of subjective or complete
judgement. These relate to:
•
capitalisation and recoverability of exploration costs (Note
10);
• share–based payments (Note 6 and Note 13).
equity, except that impairment losses, foreign exchange gains
and losses on monetary items and interest calculated using
the effective interest method are recognised in the income
statement.
Where there is a significant or prolonged decline in the fair
value of an available for sale financial asset (which constitutes
objective evidence of impairment), the full amount of the
impairment, including any amount previously charged to equity,
is recognised in the consolidated income statement. The
Directors consider a significant decline to be one in which the
fair value is below the weighted average cost by more than
25%. A prolonged decline is considered to be one in which the
fair value is below the weighted average cost for a period of
more than twelve months.
If an available for sale equity security is impaired, any further
declines in the fair value at subsequent reporting dates are
recognised as impairments. Reversals of impairments of
available for sale equity securities are not recorded through the
income statement. Upon sale, accumulated gains or losses are
recycled through the income statement.
Financial liabilities, which are measured at amortised cost, and
equity instruments are classified according to the substance
of the contractual arrangements entered into. An equity
instrument is any contract that evidences a residual interest
in the assets of the entity after deducting all of its financial
liabilities. Any instrument that includes a repayment obligation
is classified as a liability.
Where the contractual liabilities of financial instruments
(including share capital) are equivalent to a similar debt
instrument, those financial instruments are classed as financial
liabilities, and are presented as such in the Statement of
Financial Position. Finance costs and gains or losses relating
to financial liabilities are included in the income statement.
Finance costs are calculated so as to produce a constant rate
of return on the outstanding liability.
Where the contractual terms of share capital do not have
any features meeting the definition of a financial liability then
such capital is classed as an equity instrument. Dividends and
distributions relating to equity instruments are debited direct
to equity.
29
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Notes to the Financial Statements continued
For the year ended 30 September 2018
3 Operating loss
The operating loss is stated after charging:
Year ended
30 September
2018
£
Year ended
30 September
2017
£
Depreciation of property, plant and equipment
Operating lease expenses
Share–based payments
Auditors’ remuneration – fees payable to the Company’s auditor for the audit of
the parent company and consolidated financial statements
5,662
22,875
–
21,500
4,653
24,213
67,542
21,500
4 Earnings per share
Basic and Diluted
Year ended
30 September
2018
Year ended
30 September
2017
Weighted number of shares in issue during the year
263,542,617
166,559,125
Loss from continuing operations attributable to owners of the parent
£
(550,018)
£
(511,124)
Basic earnings per share has been calculated by dividing the loss attributable to equity holders of the company after taxation by
the weighted average number of shares in issue during the year. There is no difference between the basic and diluted earnings
per share as the effect on the exercise of options and warrants would be to decrease the earnings per share.
Details of share options and warrants that could potentially dilute earnings per share in future periods is set out in Note 13.
5
Income tax
The relationship between the expected tax expense based on the corporation tax rate of 19% for the year ended 30 September
2018 (2017: 19%) and the tax expense actually recognised in the income statement can be reconciled as follows:
Group loss for the year
Loss on activities at effective rate of corporation tax of 19% (2016: 20%)
Expenses not deductible for tax purposes
Income not taxable
Depreciation in excess of capital allowances
Loss carried forward on which no deferred tax asset is recognised
Current tax expense
Deferred tax (see below)
Total income tax expense
Year ended
30 September
2018
£
Year ended
30 September
2017
£
(550,018)
(104,503)
10,297
(241)
247
94,200
–
–
–
(511,124)
(97,114)
13,694
(19)
247
83,192
–
–
–
The Company has unused tax losses of approximately £4,080,000 (2017: £3,763,000) to carry forward and set against future
profits; and the Company has capital losses of £196,977 to carry forward and set against future capital gains of the Company. The
related deferred tax asset has not been recognised in respect of these losses as there is no certainty in regards to the level and
timing of future profits.
30
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
6 Staff numbers and costs
Group and Company
Directors
Administration
Total
The aggregate payroll costs of these persons were as follows:
Staff wages and salaries
Directors’ cash based emoluments
Social security costs
Share-based payments
Year ended
30 September
2018
Number
Year ended
30 September
2017
Number
3
2
5
£
12,270
216,176
15,342
–
243,788
3
1
4
£
243
208,232
10,402
67,542
286,419
The remuneration of the directors, who are the key management personnel of the Group, in aggregate for each of the categories
specified in IAS 24 ‘Related Party Disclosures’ was as follows:
Directors’ cash based emoluments
Employer’s national insurance contributions
Share-based payments
£
£
216,176
15,342
–
231,518
208,232
10,402
67,542
286,176
Directors’ remuneration
As required by AIM Rule 19, details of remuneration earned in respect of the financial year ended 30 September 2018 by each
Director are set out below:
Year ended 30 September 2018
Director
C Brown
C St John Dennis
I Jones
W Tang
Salary
Paid
£
Accrued
£
Consulting
fees
£
Share–based
payments
£
101,500
20,400
12,000
34,539
168,439
–
–
–
4,000
4,000
–
2,000
7,000
29,184
38,184
–
–
–
–
–
Total
£
101,500
22,400
19,000
67,723
210,623
31
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
6 Staff numbers and costs continued
Year ended 30 September 2017
Director
C Brown
R Watts
C St John Dennis
I Jones
W Tang
W Howell
Paid
£
90,000
484
23,385
38,968
6,395
45,000
204,232
Salary
Accrued
£
–
–
–
4,000
–
–
4,000
Bonus
£
–
–
–
37,000
–
–
37,000
Share–based
payments
£
33,771
–
–
33,771
–
–
67,542
Total
£
123,771
484
23,385
113,739
6,395
45,000
312,774
The highest paid Director received remuneration of £101,500 (2017: £90,000), excluding share–based payments.
I Jones received remuneration, excluding share-based payments, including consulting fees of £19,000 (2017: £79,968) via a
service company.
Year ended
30 September
2018
£
1,386
1,386
Year ended
30 September
2017
£
353
353
Furniture
&
fittings
£
2,982
-
2,982
Office
equipment
£
Machinery &
equipment
£
12,917
-
12,917
791
583
8,347
4,306
1,374
12,653
2,191
1,608
4,570
264
Total
£
19,764
-
19,764
11,070
5,662
16,732
8,694
3,032
3,865
-
3,865
1,932
773
2,705
1,993
1,160
7 Finance income
Finance income
Interest on cash and cash equivalents
8 Property, plant and equipment
Group
Cost
At 1 October 2017
Additions
At 30 September 2018
Depreciation
At 1 October 2017
Depreciation for the year
At 30 September 2018
Net book value
At 1 October 2017
At 30 September 2018
32
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
8 Property, plant and equipment continued
Company
Cost
At 1 October 2017
At 30 September 2018
Depreciation
At 1 October 2017
Depreciation for the year
At 30 September 2018
Net book value
At 1 October 2017
At 30 September 2018
Furniture
&
fittings
£
Office
equipment
£
Machinery &
equipment
£
890
890
373
178
551
517
339
12,917
12,917
8,347
4,306
12,653
4,570
264
3,865
3,865
1,932
773
2,705
1,933
1,160
The Group and the Company’s property, plant and equipment are free from any mortgage or charge.
The comparable table for 2017 is detailed below.
Group
Cost
At 1 October 2016
Additions
Written off
At 30 September 2017
Depreciation
At 1 October 2016
Written off
Depreciation for the year
At 30 September 2017
Net book value
At 1 October 2016
At 30 September 2017
Company
Cost
At 1 October 2016
Additions
Written off
At 30 September 2017
Depreciation
At 1 October 2016
Written off
Depreciation for the year
At 30 September 2017
Net book value
At 1 October 2016
At 30 September 2017
Furniture
& fittings
£
Office
equipment
£
Machinery &
equipment
£
3,445
2,277
(2,740)
2,982
2,950
(2,740)
581
17,729
4,833
(9,645)
12,917
14,693
(9,645)
3,299
791
8,347
495
2,191
3,036
4,570
4,172
–
(307)
3,865
1,466
(307)
773
1,932
2,706
1,933
Furniture
& fittings
£
Office
equipment
£
Machinery &
equipment
£
3,445
185
(2,740)
890
2,950
(2,740)
163
373
17,414
4,833
(9,330)
12,917
14,378
(9,330)
3,299
8,347
495
517
3,036
4,570
3,865
–
–
3,865
1,159
–
773
1,932
2,706
1,933
Total
£
17,672
17,672
10,652
5,257
15,909
7,020
1,763
Total
£
25,346
7,110
(12,692)
19,764
19,109
(12,692)
4,653
11,070
6,237
8,694
Total
£
24,724
5,018
(12,070)
17,672
18,487
(12,070)
4,235
10,652
6,237
7,020
33
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
9
Investments
Cost as at 1 October 2017
Addition
Balance at 30 September 2018
The comparable table for 2016 is detailed below:
Cost as at 1 October 2016
Addition
Balance at 30 September 2017
Investment in subsidiaries
Investment in
subsidiaries
£
852,170
558
852,728
Investment in
subsidiaries
£
740,100
112,070
852,170
At 30 September 2018, the Company had interests in the following subsidiary undertakings:
Subsidiaries:
Ochre Mining SA
Mercator Gold Australia Pty Ltd
Warm Springs Renewable Energy Corporation
Copper Flat Corporation
Address of the subsidiaries:
Principal
country of
incorporation
Argentina
Australia
USA
USA
Principal
activity
Mineral
Exploration
Mineral
Exploration
Dormant
Dormant
Description
and effective
country of
operation
Proportion of
shares held
Argentina
100%
Australia
100%
USA
USA
90%
100%
Ochre Mining SA
Reconquista 657, Piso 1, City of Buenos Aires,
Argentina
58 Gipps Street, Collingwood Victoria, 3066, Australia
Mercator Gold Australia Pty Ltd
Warm Springs Renewable Energy Corporation
315 Paseo de Peralta, Santa Fe, NM 87501, USA
Copper Flat Corporation (formerly New Mexico Copper Corporation) 315 Paseo de Peralta, Santa Fe, NM 87501, USA
Available for sale financial assets
Quoted investments
At 1 October
Fair value movements
At 30 September
2018
£
22,269
(971)
21,299
2017
£
21,014
1,255
22,269
The available for sale financial asset at 30 September 2017 and 2018 comprises shares in Tiger International Resources, Inc.
34
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
10 Intangible assets – exploration and development costs
At 1 October
Additions
Translation difference
At 30 September
Group
Company
2018
£
2017
£
2018
£
2017
£
2,668,747
302,794
(64,346)
2,437,608
284,063
(52,924)
2,180,312
75,997
–
2,076,103
104,208
–
2,859,474
2,668,747
2,256,309
2,180,312
An operating segment level summary of exploration and development costs of the Group is presented below:
Danglay Gold Project, Philippines
SLM Gold Project, Argentina
Central Victorian Gold Projects, Australia
Iceberg Gold Project
At 30 September
Danglay Gold Project, Philippines
2018
£
1,176,729
1,038,418
619,327
25,000
2017
£
1,160,848
1,161,979
345,920
–
2,859,474
2,668,747
In late April 2013 ECR entered into an earn-in and joint venture agreement (the “Agreement”) in relation to the Danglay gold
project in the Philippines. Cordillera Tiger Gold Resources, Inc. (“Cordillera Tiger”) is a Philippine corporation and the holder of the
exploration permit (the “EP”) which represents the Danglay project.
Activities under the Agreement commenced in December 2013 and ceased when the Earn-In Option (as that term is defined in
the Agreement) was terminated in August 2016. The Philippine mining industry is enduring a period of significant political and
regulatory upheaval, which has been particularly intense and unpredictable since June 2016. In light of this, termination of the
Earn-In Option was considered a prudent step for the Company to take.
The Agreement gave ECR the exclusive right and option to earn a 25% or 50% interest in Cordillera Tiger and thereby in the
Danglay project. Under the terms of the Agreement, ECR was the operator of the Danglay project, through Cordillera Tiger. The
completion of various exploration programmes generated valuable data which is relevant to the assessment of the project’s
economic potential.
In December 2015, the Company published an NI43-101 technical report (the “Report”) in relation to the Danglay project.
The Report also disclosed a target for further exploration, as permitted by NI43-101. The Report supports the disclosure on 5
November 2015 of an inferred mineral resource estimate for oxide gold mineralisation at Danglay.
Under the Agreement, the estimation of this mineral resource and the making of expenditures exceeding US$500,000 in
connection with the Danglay project entitle ECR to a 25% interest in Cordillera Tiger. Both conditions have been satisfied, but the
relevant shareholding has yet to be issued, despite a resolution of Cordillera Tiger’s board of directors authorising the issuance.
One of the delaying factors is a lawsuit which has been filed in the Philippines against three members of the Cordillera Tiger
board. The lawsuit challenges, among other things, the resolution approving the issuance of shares in Cordillera Tiger to ECR.
The plaintiff in the suit is Patric Barry, a director of Cordillera Tiger at the time the suit was initiated. The Company considers the
lawsuit to be a transparent and unscrupulous attempt to obstruct Cordillera Tiger’s performance of its contractual obligations and
deprive ECR of its rightful shareholding.
Renewal of the EP for a further two-year term was applied for in September 2015, and in June 2016 the renewed EP was issued
to Cordillera Tiger for signature and return to the Philippine authorities. The final renewed EP has yet to be provided to Cordillera
Tiger, and the status of the renewal is unclear. Given the political and regulatory uncertainty affecting the mining sector in the
Philippines, the delay is not unexpected.
The Danglay project remains attractive from a technical standpoint, but due to the high level of political and regulatory risk
affecting the Philippine mining sector, only limited efforts by ECR to enforce its rights in respect of Cordillera Tiger have to date
been considered commercially justifiable.
However, the political climate for the minerals industry in the Philippines appears on course to improve in future, and the Directors
are aware of the circumstances surrounding the aforementioned litigation and consider that a favourable outcome for the
Company (which is not a party to the litigation) is more likely than not.
35
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
11 Trade and other receivables
Non-current assets
Amount owed by a subsidiary
Current assets
Amount owed by a subsidiary
Other receivables
Prepayments and accrued income
Group
Company
2017
£
2018
£
2017
£
–
538,494
240,970
–
46,884
8,004
54,888
410,556
17,470
43,644
265,180
9,847
6,874
471,670
281,901
2018
£
–
–
36,095
43,318
79,413
The short–term carrying values are considered to be a reasonable approximation of the fair value.
12 Cash and cash equivalents
Cash and cash equivalents consisted of the following:
Deposits at banks
Cash on hand
Group
Company
2018
£
2017
£
2018
£
2017
£
781,139
3
1,082,941
53
749,025
–
1,046,739
48
781,142
1,082,994
749,025
1,046,787
13 Share capital and share premium accounts
The share capital of the Company consists of three classes of shares: ordinary shares of 0.001p each which have equal rights
to receive dividends or capital repayments and each of which represents one vote at shareholder meetings; and two classes of
deferred shares, one of 9.9p each and the other of 0.099p each, which have limited rights as laid out in the Company’s articles.
In particular deferred shares carry no right to dividends or to attend or vote at shareholder meetings and deferred share capital is
only repayable after the nominal value of the ordinary share capital has been repaid.
a)
Changes in issued share capital and share premium
Number of
Shares
247,605,240
Ordinary
shares
£
2,476
Deferred Deferred ‘B’
0.099p
shares
£
3,828,359
9.9p
shares
£
7,194,816
Deferred
0.199p
shares
£
Total
shares
£
Share
premium
£
Total
£
257,161 11,282,812 43,823,335 55,106,147
92,857,143
929
1,500,00
15
-
-
-
-
-
-
929
621,851
622,780
15
14,985
15,000
At 1 October 2017
Issue of shares
less costs
Shares issued in
payment of creditors
Balance at
30 September 2018 341,962,383
3,420
7,194,816
3,828,359
257,161 11,283,756 44,460,171 55,743,927
All the shares issued are fully paid up and none of the Company’s shares are held by any of its subsidiaries.
36
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
13 Share capital and share premium accounts continued
b)
Potential issue of ordinary shares
Share options
The number and weighted average exercise prices of share options valid at the year–end are as follows:
Exercisable at the beginning of the year
Granted during the year
Expired during the year
Weighted
average
exercise price
2018
£
0.127
–
0.40
Number of
options
2018
9,904,670
–
(650,000)
Weighted
average
exercise price
2017
£
0.637
0.01725
–
Number of
options
2017
1,750,702
8,153,968
–
Exercisable at the end of the year
0.108
9,254,670
0.127
9,904,670
The options outstanding at 30 September 2018 have a weighted average remaining contractual life of three years (2017: four
years).
The options outstanding at the end of the year have the following expiry date and exercise prices:
Date granted
Expiry Date
Exercise Price in
6 January 2011
31 December 2014
27 February 2017
5 January 2021
30 December 2019
26 February 2022
£5.00
£0.55
£0.01725
No. of Options
56,000
1,044,702
8,153,968
Share-based payments
There were no options issued during the year.
Share warrants
Exercisable at the beginning of the year
Expired during the year
Granted during the year
Weighted
average
exercise price
2018
£
0.03245
0.0721
0.01257
Number of
warrants
2018
103,745,559
(427,766)
95,357,143
Weighted
average
exercise price
2017
£
0.0583
0.2363
0.0290
Number of
warrants
2017
15,651,338
(485,963)
88,580,184
Exercisable at the end of the year
0.010682
198,674,936
0.03245
103,745,559
The warrants outstanding at the end of the year have the following expiry date and exercise prices:
Date granted
Expiry Date
Exercise Price
23 November 2015
8 December 2015
9 March 2016
4 April 2016
6 May 2016
2 June 2016
6 September 2016
6 September 2016
6 September 2016
20 September 2016
2 June 2017
6 June 2017
6 June 2017
6 June 2017
30 July 2018
30 July 2018
22 November 2018
7 December 2018
8 March 2019
3 April 2019
5 May 2019
1 June 2019
5 September 2019
5 September 2019
5 September 2019
19 September 2019
1 June 2020
5 June 2020
5 June 2022
5 June 2022
29 July 2020
29 July 2020
£
0.08
0.08
0.0656
0.0562
0.0532
0.0456
0.01
0.03
0.02
0.03
0.018
0.01
0.02
0.05
0.0125
0.015
No. of
Warrants
4,500,000
1,750,000
858,779
583,333
404,930
473,901
2,000,000
2,500,000
1,000,000
666,667
2,777,778
2,767,820
55,356,391
27,678,195
92,857,143
2,500,000
37
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
14 Trade and other payables
Trade payables
Social security and employee taxes
Other creditors and accruals
15 Capital management
Group
Company
2018
£
47,864
9,240
35,712
92,816
2017
£
44,227
13,684
44,456
102,367
2018
£
41,797
9,240
24,625
75,662
2017
£
34,104
13,684
32,644
80,432
The Group’s objective when managing capital is to safeguard the entity’s ability to continue as a going concern and develop its
mineral exploration and development and other activities to provide returns for shareholders and benefits for other stakeholders.
The Group’s capital structure comprises all the components of equity (all share capital, share premium, retained earnings when
earned and other reserves). When considering the future capital requirements of the Group and the potential to fund specific
project development via debt, the Directors consider the risk characteristics of the underlying assets in assessing the optimal
capital structure.
16 Related party transactions
Group
Company
2018
£
2017
£
2018
£
2017
£
Amounts owed to Directors
11,960
12,323
11,960
12,323
Details of Directors’ emoluments are disclosed in Note 6. The amounts owed to Directors relate to accrued emoluments,
consulting fees and expenses due.
The Directors are the only key management. Transactions with the Directors are disclosed in Note 18 and this note.
During the year the Company provided additional advances of £297,524 under a loan to Mercator Gold Australia Pty Ltd and
charged expenses and management fees of £145,376. The balance owed to the Company is shown in Note 11.
The Company and the Group have no ultimate controlling party.
17 Commitments and contingencies
Capital expenditure commitment
As at 30 September 2018, the Group had no commitments (2017: £Nil).
The Group is committed to issuing a further AUD 150,000 worth of Ordinary Shares in ECR contingent on commercial production
being established from either the Avoca or the Bailieston projects.
Operating lease commitments
Details of operating lease commitments are set out in Note 18 below.
18 Operating leases
The total amounts payable under:
Non–cancellable operating lease liabilities of the Group and Company are as follows:
Payable:
Within 1 year
38
2018
£
–
2017
£
–
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
19 Financial instruments
Categories of financial instrument
Group
Financial assets (loans and receivables)
Trade and other receivables (excluding prepayments)
Cash and cash equivalents
Available for sale financial assets
Financial liabilities (amortised cost)
Trade and other payables
Company
Financial assets (loans and receivables)
Trade and other receivables (excluding prepayments)
Cash and cash equivalents
Available for sale financial assets
Financial liabilities (amortised cost)
Trade and other payables
2018
£
36,095
781,142
817,237
21,299
21,299
92,816
92,816
2018
£
966,520
749,025
1,715,545
21,299
21,299
75,662
75,662
2017
£
46,884
1,082,994
1,129,878
22,269
22,269
102,367
102,367
2017
£
515,997
1,046,787
1,562,784
22,269
22,269
80,432
80,432
Risk management objectives and policies
The Group’s principal financial assets comprise cash and cash equivalents, trade and other receivables, investments and
prepayments. The Group’s liabilities comprise trade payables, other payables including taxes and social security, and accrued
expenses.
The Board determines as required the degree to which it is appropriate to use financial instruments, commodity contracts or other
hedging contracts to mitigate financial risks.
Credit risk
The Group’s cash at bank is held with reputable international banks. Cash is held either on current account or on short–term
deposit at floating rates of interest determined by the relevant prevailing base rate. The fair value of cash and cash equivalents at
30 September 2017 and 30 September 2016 did not differ materially from their carrying value.
Market risk
The Group’s financial instruments potentially affected by market risk include bank deposits, and trade payables. An analysis is
required by IFRS 7, intended to illustrate the sensitivity of the Group’s financial instruments (as at period end) to changes in
market variables, being exchange rates and interest rates.
The Group’s exposure to market risk is not considered to be material.
Interest rate risk
The Group has no material exposure to interest rate risk.
Since the interest accruing on bank deposits was relatively immaterial there is no material sensitivity to changes in interest rates.
Foreign currency risk
The Group is exposed to foreign currency risk in so far as some dealings with overseas subsidiary undertakings are in foreign
currencies.
39
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
Notes to the Financial Statements continued
For the year ended 30 September 2018
19 Financial instruments continued
Fair value of financial instruments
The fair values of the Company’s financial instruments at 30 September 2018 and 30 September 2017 did not differ materially
from their carrying values.
The Group measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making
the measurements:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2: valuation techniques based on observable inputs either directly (i.e. as prices) or indirectly (i.e. derived from prices);
• Level 3: valuation techniques that include inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value,
by the level in the fair value hierarchy into which the measurement is categorised.
Group and Company
30 September 2018
Available for sale financial assets
Group and Company
30 September 2017
Available for sale financial assets
Liquidity risk
Level 1
£
21,299
21,299
Level 1
£
22,269
22,269
Level 2
£
Level 3
£
–
–
–
–
Level 2
£
Level 3
£
–
–
–
–
Total
£
21,299
21,299
Total
£
22,269
22,269
The Group finances its operations primarily through the issue of equity share capital and debt in order to ensure sufficient cash
resources are maintained to meet short–term liabilities and future project development requirements. Management monitors
availability of funds in relation to forecast expenditures in order to ensure timely fundraising. Funds are raised in discrete tranches
to finance activities for limited periods.
Funds surplus to immediate requirements may be placed in liquid, low risk investments.
The Group’s ability to raise finance is subject to market perceptions of the success of its projects undertaken during the year and
subsequently. Due to the uncertain state of financial markets there can be no certainty that future funding will continue to be
available.
The table below sets out the maturity profile of financial liabilities as at 30 September 2018.
Due in less than 1 month
Due between 1 and 3 months
Due between 3 months and 1 year
Due after 1 year
2018
£
92,816
–
–
–
92,816
2017
£
102,367
–
–
–
102,367
40
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
20 Segmental report
The Group is engaged in mineral exploration and development. Management does not segment the mineral exploration activity by
geographical region when evaluating performance.
21 Cash used in operations
Group
Company
Year ended
30 September
2018
£
Year ended
30 September
2017
£
Year ended
30 September
2018
£
Year ended
30 September
2017
£
Note
Operating activities
Loss for the year before tax
Adjustments:
Depreciation expense property, plant and equipment
(Gain)/Loss on available for sale assets
Interest income
Share based payments
Increase in accounts receivable
Increase in taxation
Decrease in accounts payable
Shares issued in lieu of expense payments
8
(550,019)
(511,124)
(373,149)
(208,774)
5,661
970
(1,386)
–
(24,525)
–
(9,551)
15,000
3,717
(1,255)
(353)
67,542
(36,899)
28,212
(199,876)
81,019
5,257
970
(1,286)
–
(189,769)
–
(4,753)
15,000
3,299
(1,255)
(233)
67,542
(265,235)
220
(187,891)
81,019
Net cash flow used in operations
(563,850)
(569,016)
(547,730)
(511,307)
22 Events after the reporting date
•
•
On 21 December 2018 the Company announced a placing of 100,000,000 new ordinary shares for gross proceeds of
£700,000. Each placing share was issued with a warrant to subscribe for a further new ordinary share.
On 22 February 2019, the Company announced the appointment of Samuel James Melville Garrett as a non-executive director
with immediate effect.
41
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
PLEASE NOTE THAT THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any
doubt as to what action you should take, please consult your stockbroker or other independent adviser authorised under
the Financial Services and Markets Act 2000 immediately. If you have recently sold or transferred all of your ordinary shares
in ECR Minerals PLC, please forward this document, together with the accompanying documents, as soon as possible either
to the purchaser or transferee or to the person who arranged the sale or transfer so they can pass these documents to
the person who now holds the shares. If you have sold or transferred only part of your holding of ordinary shares in ECR
Minerals PLC, you are advised to consult your stockbroker, bank or other agent through whom the sale or transfer was
effected.
ECR MINERALS PLC
(the “Company”)
(Registered in England and Wales No 05079979)
NOTICE OF ANNUAL GENERAL MEETING
NOTICE is hereby given that the Annual General Meeting of the Company will be held at the offices of Charles Russell Speechlys
LLP, 5 Fleet Place, London EC4M 7RD on 23 April 2019 at 9.00 a.m. for the purpose of considering and, if thought fit, passing
Resolutions 1 to 5 as ordinary resolutions, and Resolutions 6 and 7 as special resolutions:
Ordinary Resolutions
1
2
3
To receive, consider and adopt the annual accounts of the Company for the year ended 30 September 2018, together with the
reports of the directors and auditors thereon.
That Samuel James Melville Garrett, a director retiring in accordance with article 79.1.1 of the Company’s articles of association,
be elected as a director of the Company.
To re-appoint PKF Littlejohn LLP as auditors of the Company, to hold office until the conclusion of the next general meeting at
which accounts are laid before the Company.
4
To authorise the audit committee to determine the remuneration of the auditors of the Company.
5
That the directors be generally and unconditionally authorised pursuant to and in accordance with section 551 of the Companies
Act 2006 (the “CA 2006”) to exercise all the powers of the Company to allot shares or grant rights to subscribe for, or to convert
any security into, shares in the Company up to an aggregate nominal amount of £10,000 provided that this authority shall, unless
renewed, varied or revoked by the Company, expire on 30 June 2020 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 equity
securities to be allotted (or treasury shares to be sold) after the authority expires and the directors may allot equity securities (or
sell treasury shares) in pursuance of any such offer or agreement as if the authority had not expired.
Special Resolutions
6 That, subject to the passing of Resolution 5, the directors be empowered to allot equity securities (as defined by section 560
of the CA 2006) pursuant to the authority conferred by Resolution 5 for cash, and/or sell treasury shares for cash, as if section
561(1) of the CA 2006 did not apply to any such allotment, provided that this power shall be limited to the allotment of equity
securities of up to an aggregate nominal value of £10,000. The authority granted by this resolution will expire at the conclusion of
the Company’s next annual general meeting after this resolution is passed or, if earlier, at the close of business on 30 June 2020
save that the Company may, before such expiry, make offers or agreements which would or might require equity securities to
be allotted (or treasury shares to be sold) after the authority expires and the directors may allot equity securities (or sell treasury
shares) in pursuance of any such offer or agreement as if the authority had not expired.
7 That the Company be generally and unconditionally authorised for the purposes of section 701 of the CA 2006 to make one or
more market purchases (as defined in section 693(4) of the CA 2006) of its ordinary shares with nominal value of £0.00001 each
in the Company, provided that:
7.1 the Company does not purchase under this authority more than 44,584,078 ordinary shares;
7.2 the Company does not pay less than £0.00001 for each ordinary share; and
42
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 7.3 the Company does not pay more per ordinary share than the higher of (i) an amount equal to 5 per cent. over the average of the
middle-market price of the ordinary shares for the five business days immediately preceding the day on which the Company
agrees to buy the shares concerned, based on share prices published in the Daily Official List of the London Stock Exchange; and
(ii) the amount stipulated by the regulatory technical standards adopted by the European Commission pursuant to Article 5(6) of
the Market Abuse Regulation (EU) No. 596/2014.
This authority shall continue until the conclusion of the Company’s annual general meeting in 2020 or 30 June 2020, whichever is
the earlier, provided that if the Company has agreed before this date to purchase ordinary shares where these purchases will or
may be executed after the authority terminates (either wholly or in part) the Company may complete such purchases.
By order of the board
Craig Brown
Director and Company Secretary
Registered Office:
Unit 117, Chester House
81-83 Fulham High Street
Fulham Green
London, SW6 3JA
29 March 2019
43
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
NOTES ON RESOLUTIONS
The following paragraphs explain, in summary, the resolutions
to be proposed at the annual general meeting (the “Meeting”).
Resolution 1: Receipt of the annual accounts
Resolution 1 proposes that the Company’s annual accounts
for the period ended 30 September 2018, together with the
reports of the directors and auditors on these accounts, be
received, considered and adopted.
Resolution 2: Election of Samuel James Melville Garrett
Resolution 2 proposes that Mr Garrett, who was appointed
since the last Annual General Meeting of the Company and
is retiring in accordance with article 79.1.1 of the Company’s
articles of association, be elected as a director of the Company.
Resolution 3: Re-appointment of auditor
Resolution 3 proposes the reappointment of the Company’s
existing auditor to hold office until the end of the next annual
general meeting.
Resolution 4: Remuneration of auditor
Resolution 4 is to authorise the audit committee of the
Company to determine the remuneration of the Company’s
auditors.
Resolution 5: Authority to allot shares
Resolution 5 is to renew the directors’ power to allot shares
in accordance with section 551 of the CA 2006. The authority
granted at the annual general meeting on 24 April 2018 is
due to expire on 23 April 2019 (i.e. the proposed date of the
forthcoming annual general meeting).
If passed, the resolution will authorise the directors to allot
equity securities up to a maximum nominal amount of £10,000,
which represents approximately 224% of the Company’s
issued ordinary shares as at 28 March 2019 (being the latest
practicable date before publication of this document).
If given, these authorities will expire at the annual general
meeting in 2020 or on 30 June 2020, whichever is the earlier.
The directors have no present intention to issue new ordinary
shares, other than pursuant to the exercise of options
or warrants. However, the directors consider it prudent
to maintain the flexibility to take advantage of business
opportunities that this authority provides.
As at the date of this document the Company does not hold
any ordinary shares in the capital of the Company in treasury.
Resolution 6: Disapplication of pre-emption rights
Resolution 6 is to grant the directors the authority to allot
equity securities for cash or sell any shares held in treasury
otherwise than to existing shareholders pro rata to their
holdings, as there may be occasions where it is in the best
interests of the Company not to be required to first offer such
shares to existing shareholders.
Accordingly, resolution 6 will be proposed as a special
resolution to grant such a power and will permit the directors,
pursuant to the authority granted by resolution 5, to allot
equity securities (as defined by section 560 of the CA 2006)
or sell treasury shares for cash without first offering them to
existing shareholders in proportion to their existing holdings
up to a maximum nominal value of £10,000 representing
approximately 224% of the Company’s issued ordinary shares
as at 28 March 2019 (being the latest practicable date before
publication of this document). If given, this authority will expire
at the annual general meeting in 2020 or on 30 June 2020,
whichever is the earlier.
Resolution 7: Purchase of own shares
Resolution 7 will be proposed as a special resolution and will
give the Company authority to purchase its own shares in the
markets up to a limit of 10 per cent. of its issued ordinary share
capital. The maximum and minimum prices are stated in the
resolution. Your directors believe that it is advantageous for the
Company to have this flexibility to make market purchases of
its own shares.
Your directors will exercise this authority only if they are
satisfied that a purchase would result in an increase in
expected earnings per share and would be in the interests of
shareholders generally. In the event that shares are purchased,
they would either be cancelled (and the number of shares in
issue would be reduced accordingly) or, in accordance with the
CA 2006, be retained as treasury shares.
If given, this authority will expire at the annual general meeting
in 2020 or on 30 June 2020, whichever is the earlier.
As at 28 March 2019, the total number of outstanding options
and warrants over ordinary shares in the Company was
309,179,606, which represents approximately 69 per cent. of
the Company’s voting rights at that date. If the Company were
to purchase its own ordinary shares to the fullest possible
extent of its authority from shareholders (existing and being
sought), this number of outstanding options and warrants could
potentially represent 82 per cent. of the voting rights of the
Company as at 28 March 2019.
44
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 SHAREHOLDER NOTES
The following notes provide more detailed information about
your voting rights, and how you may exercise them.
1
2
A member entitled to attend and vote at the meeting
is entitled to appoint another person(s) (who need not
be a member of the Company) to exercise all or any of
his rights to attend, speak and vote at the meeting. A
member can appoint more than one proxy in relation to
the meeting, provided that each proxy is appointed to
exercise the rights attaching to different shares held by
him.
Your proxy could be the Chairman, another director of the
Company or another person who has agreed to attend
to represent you. Your proxy will vote as you instruct and
must attend the meeting for your vote to be counted.
Details of how to appoint the Chairman or another person
as your proxy using the proxy form are set out in the
notes to the proxy form. Appointing a proxy does not
preclude you from attending the meeting and voting in
person. If you attend the meeting in person, your proxy
appointment will automatically be terminated.
3
An appointment of proxy is provided with this notice and
instructions for use are shown on the form. In order to be
valid, a completed appointment of proxy must be returned
to the Company by one of the following methods:
3.1
in hard copy form by post, by courier or by hand to the
Company’s registrars, Computershare Investor Services
plc, at the address shown on the form of proxy; or
3.2
in the case of CREST members, by utilising the CREST
electronic proxy appointment service in accordance with
the procedures set out below,
and in each case must be received by the Company by
9.00 a.m. on 17 April 2019 or in the case of any adjourned
meeting 48 hours (excluding non-business days) before
the adjourned meeting.
Please note that any electronic communication sent to
us/our registrars in respect of the appointment of a proxy
that is found to contain a computer virus will not be
accepted.
In the case of a member which is a company, the proxy
form 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
the proxy form is signed (or a duly certified copy of such
power or authority) must be included with the proxy form.
To change your proxy instructions you may return a new
proxy appointment using the methods set out above.
Where you have appointed a proxy using the hard copy
proxy form and would like to change the instructions
using another hard copy proxy form, please contact
Computershare Investor Services plc. The deadline for
4
5
6
7
8
receipt of proxy appointments (see above) also applies
in relation to amended instructions. Any attempt to
terminate or amend a proxy appointment received after
the relevant deadline will be disregarded. Where two or
more valid separate appointments of proxy are received
in respect of the same share in respect of the same
meeting, the one which is last sent shall be treated as
revoking the other or others.
CREST members who wish to appoint a proxy or proxies
by utilising the CREST electronic proxy appointment
service may do so by utilising the procedures described
in the CREST Manual. CREST Personal Members or other
CREST sponsored members, and those CREST members
who have appointed a voting service provider(s), should
refer to their CREST sponsor or voting service provider(s),
who will be able to take the appropriate action on their
behalf.
In order for a proxy appointment made by means of
CREST to be valid, the appropriate CREST message
(a “CREST Proxy Instruction”) must be properly
authenticated in accordance with Euroclear UK & Ireland’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 3RA50) by the latest time(s) for receipt of proxy
appointments specified in the notice of meeting. For this
purpose, the time of receipt will be taken to be the time
(as determined by the timestamp applied to the message
by the CREST Applications Host) from which the issuer’s
agent is able to retrieve the message by enquiry to CREST
in the manner prescribed by CREST.
9
The Company may treat as invalid a CREST Proxy
Instruction in the circumstances set out in Regulation
35(5)(a) of the Uncertificated Securities Regulations 2001.
10 CREST members and, where applicable, their CREST
sponsors or voting service providers should note that
Euroclear UK & Ireland does not make available special
procedures in CREST for any particular messages. Normal
system timings and limitations will therefore apply in
relation to the input of CREST Proxy Instructions. It is
the responsibility of the CREST member concerned
to take (or, if the CREST member is a CREST personal
member or sponsored member or has appointed a voting
service provider(s), to procure that his CREST sponsor
or voting service provider(s) take(s)) such action as shall
be necessary to ensure that a message is transmitted by
means of the CREST system by any particular time. In this
connection, CREST members and, where applicable, their
CREST sponsors or voting service providers are referred,
in particular, to those sections of the CREST Manual
concerning practical limitations of the CREST system and
timings.
45
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018
11 Only those shareholders registered in the Register of
Members of the Company as at 6.00 p.m. on 17 April
2019 (or, if the meeting is adjourned, on the date which is
48 hours (excluding non-business days) before the time
of the adjourned meeting) shall be entitled to attend and
vote at the meeting or adjourned meeting in respect of
the number of shares registered in their respective names
at that time. Changes to the Register of Members after
that time will be disregarded in determining the rights of
any person to attend or vote at the meeting or adjourned
meeting.
12 Any corporation which is a member can appoint one or
more corporate representatives who may exercise on its
behalf all of its powers as a member provided that they do
not do so in relation to the same shares.
13 You may not use any electronic address provided either in
this notice of general meeting or any related documents
(including the form of proxy) to communicate with the
Company for any purposes other than those expressly
stated.
14 As at 28 March 2019 (being the last business day
before the publication of this notice), the Company’s
issued ordinary share capital consisted of 445,840,783
ordinary shares carrying one vote each. The Company
does not hold any shares in treasury. In addition,
there are 72,674,911 deferred shares of £0.099 each,
3,867,029,332 deferred B shares of £0.00099 each and
129,226,440 deferred shares of £0.00199 each which do
not carry voting rights.
15 Any member attending the meeting has the right to ask
questions. The Company must cause to be answered any
such question relating to the business being dealt with at
the meeting but no such answer need be given if:
15.1 to do so would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential
information;
15.2 the answer has already been given on a website in the
form of an answer to a question; or
15.3 it is undesirable in the interests of the company or the
good order of the meeting that the question be answered.
16
Information regarding the meeting is available from www.
ecrminerals.com.
46
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 Company Information
DIRECTORS
Weili (David) Tang
Non–Executive Chairman
Craig William Brown
Director & CEO
Samuel Garrett
Non-Executive Director
COMPANY SECRETARY
Craig William Brown
Unit 117, Chester House
81-83 Fulham High Street
Fulham Green London SW6 3JA
AUDITOR
PKF Littlejohn LLP
Statutory Auditor
1 Westferry Circus
Canary Wharf
London E14 4HD
AIM NOMINATED ADVISER
WH Ireland Group plc
24 Martin Lane
London
EC4R 0DR
REGISTRARS
AIM BROKER OF RECORD
Computershare Investor Services plc
SI Capital
The Pavilions
Bridgwater Road
Bristol BS13 8AE
REGISTERED AND HEAD OFFICE
LEGAL ADVISERS
Charles Russell Speechlys LLP
5 Fleet Place
London EC4M 7RD
ECR Minerals plc
Unit 117, Chester House
81-83 Fulham High Street
Fulham Green
London SW6 3JA
Tel: +44 (0)20 7929 1010
Fax: +44 (0)20 7929 1015
info@ecrminerals.com
www.ecrminerals.com
AIM ticker: ECR
Twitter.com/ecrminerals
46 Bridge Street
Godalming GU7 1HL
BANKERS
Barclays Bank plc
1 Churchill Place
London
E14 5HP
47
ECR MINERALS PLCANNUAL REPORT & ACCOUNTS 2018 NP0319.2879
Continue reading text version or see original annual report in PDF
format above