Company Registration No. 05697574
KAZERA GLOBAL plc
Annual Report
For the year ended 30 June 2022
KAZERA GLOBAL PLC
CONTENTS
Page
1
2
3
5
11
14
20
21
22
27
28
29
30
31
32
Company information
Chairman’s statement
Chief Executive Officer’s review
Strategic report
Directors’ report
Chairman’s corporate governance statement
Directors’ report on remuneration
Statement of directors’ responsibilities
Report of the independent auditor
Group statement of comprehensive income
Group and Company statements of financial position
Group statement of changes in equity
Company statement of changes in equity
Group and Company statements of cash flows
Notes forming part of the Group financial statements
COMPANY INFORMATION
DIRECTORS:
SECRETARY:
REGISTERED OFFICE:
Gerard Kisbey-Green - Chairman
Dennis Edmonds
Geoffrey Eyre
Brian James
Unit D, De Clare House
Sir Alfred Owen Way
Pontygwindy Industrial Estate
Caerphilly
Wales
CF83 3HU
COMPANY REGISTRATION NUMBER:
05697574
REGISTRAR AND TRANSFER OFFICE:
SOLICITORS:
INDEPENDENT AUDITORS:
NOMINATED ADVISOR & BROKER:
BANKERS:
Link Group
10th Floor, Central Square
29 Wellington Street
Leeds
LS1 4DL
Kuit Steinart Levy LLP
3 St Mary’s Parsonage,
Manchester
M3 2RD
PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London
E14 4HD
FinnCap Limited
60 New Broad Street
London
EC2M 1JJ
HSBC Bank PLC
3 Rivergate
Temple Quay
Bristol
BS1 6ER
KAZERA GLOBAL PLC
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KAZERA GLOBAL PLC
CHAIRMAN’S STATEMENT
For the year ended 30 June 2022
Review of the Period
Joining the team at Kazera Global this year has been an exciting prospect, with all the Company’s assets on the verge of becoming
cash flow positive. The Company has made significant progress over the past year in building the infrastructure on its various projects
to move them to production. We are on track to both production and revenue, generating significant cash inflows during the year
ending 30 June 2023; this work is described further in the Chief Executive Officers review on page 3.
Kazera has performed well in what has been a turbulent year globally, and over the period Kazera has delivered growth both
organically and inorganically.
The potential acquisition of a 71% interest in Great Lakes Graphite, Kenya Rare Earth projects, announced in June, was a significant
potential step forward into further diversifying the Company’s portfolio, maximising shareholder value whilst minimising downside
risk. Due to delays in obtaining the licence, and in light of the board’s wish to focus on Whale Head Minerals’ Heavy Mineral Sands
project, the board has decided not to proceed with this transaction.
Post period end, the Company signed a definitive agreement to sell its 100% interest in African Tantalum (Proprietary) Limited to
Hebei Xinjian Construction for cash consideration of US$13,000,000 in December 2022. Seizing opportunities such as this highlight
the rigour and expertise of the team driving growth for the business and the profitable realisation of assets.
As well as realising capital value by the disposal of African Tantalum, Kazera has continued to drive organic growth through
investment in its assets. The development of the diamond and Heavy Mineral Sands projects has been a clear example of the team’s
dedication to maximising growth through investment in a promising project, executing plans to develop the processing plant, driving
potential production figures and cashflow for the mine and subsequently the Company.
In addition to my joining the Kazera Board, post-reporting period, the Company was also pleased to appoint Geoffrey Eyre as a Non-
Executive Director in July 2022. Geoff, as an experienced finance professional with more than 17 years of experience in senior
positions in the mining industry, is already making an impact as a great addition to the Board.
Outlook
We plan to continue to drive growth in the business both through organic and inorganic means, leaning on the expertise of the team
to maximise the opportunities available to us. We will also be exploring ways in which to return to shareholders a substantial portion
of the gains made.
As Kazera moves forward it is in a prime position to deliver a promising year for the business. With cash in hand and the growth in
cashflow potential, the business will look to maximise shareholder value by continuing to reinvest, whether it be through further
developing assets or through M&A transactions.
I would like to take this opportunity to thank the Kazera Board, management team, and all our employees as well as our advisors for
their continued work and dedication.
Gerard Kisbey-Green
Chairman
15 March 2023
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KAZERA GLOBAL PLC
CHIEF EXECUTIVE OFFICER’S REVIEW
For the year ended 30 June 2022
Overview
I am pleased to provide an update following a very strong period for Kazera Global Plc.
As the Company continues to progress towards generating significant cashflow I would like to thank all the team for their hard work
throughout the year and in dealing with the aftershock of the COVID-19 pandemic.
Operations
Kazera has continued to build through organic growth, initially securing of a three-year tantalum off-take agreement that would
support the Company’s cashflow through until 31 December 2024. This deal was signed in September 2021 with Jiujiang Jinxin
Nonferrous Metals Co Ltd at Tantalite Valley, Namibia. Post-period, in July 2022, the Company announced an agreement to secure a
non-dilutive US$7.5 million investment in return for a 49% stake in the Company’s marketing, sales and export subsidiary for all
lithium production from the Tantalite Valley mine in Namibia. This deal was further improved when, in December 2022, the Company
secured a deal to dispose of its entire interest in African Tantalum (Proprietary) Limited (“Aftan”) to Hebei Xinjian Construction for
cash consideration of US$13,000,000. This second deal was the result of continued investment in the asset and its production
capabilities including a processing plant refurbishment plan outlining a path to unlock significant cashflow potential from the asset
once completed. Exploration work at the Tantalite Valley Mine also sampled high quality Lithium and Feldspar from the site which
increased the attractiveness of the asset for potential buyers. The transaction is transformational for Kazera and represents a real
milestone for the Company as the first realization of returns from an investment in line with our stated strategy as an investing
company of building value in our investments whilst maintaining flexibility for opportunistic exit points. This strategic exit will also
enable management to focus on our existing projects and further potential investments.
In September 2021, Kazera acquired 60% of Whale Head Minerals (“WHM”). This transaction offered Kazera exposure to the WHM
application for a Mining Permit over a Heavy Mineral Sands (“HMS”) project with a net present value (“NPV”) of £150 million as
calculated by independent consultancy company Creo Design (Pty) Limited based on expected production of circa 6,000 tons of HMS
per month generating an estimated gross profit of in excess of $300,000 per month. Post-period, in August 2022, the Mining Permit
was granted to WHM, enabling the Company to start building the HMS mine. This will place a substantial positive impact on the
Company's profitability, and also holds potential to generate broader opportunities for Kazera in the Richtersveld where we are now
focused on delivering production at Walviskop.
Following the WHM acquisition, the Group had a balance in respect of Mines Under Construction, which related to the acquisition of
the subsidiaries, Aftan, Deep Blue and WHM, of £2,961k.
Throughout the period, the Group has been mining diamond gravel. Despite achieving over 1,000 carats in one cycle, the Group has,
like all other contractors in the region, been hampered by the fact that the processing facility run by Alexkor at Muisvlak has not been
operational. Without being able to process gravels, the Company was unable to sell diamonds. For a period, at Alexkor’s request, the
Group took over the running of the facility with operational success, but was forced to withdraw its assistance due to political and
economic factors. Post-period the Group acquired the use of a pan plant and a jig which will enable it to bypass Muisvlak in its entirety
and submit highly concentrated gravel only for final sorting. This is expected to have a major impact on cash flows before the end of
the year.
Our path to profitability remains the Company’s ultimate priority and in October 2021, Kazera established a new loan facility to allow
the Company to draw down £250k to maximise the Company’s growth potential. This facility provided the Company with a cash buffer
to overcome any short-term cash issues which might otherwise have hindered its route to positive cash flow. In addition, the Company
increased its borrowings from Westleigh Investment Holdings Limited (“WIHL”), a company controlled by Giles Clarke and Nick Harrison
(who were at the time directors of the Company). At the end of the year, £199k remained outstanding to WIHL; this amount was repaid
in full, in January 2023.
On 5 May 2022, the Company announced that it had raised £1 million by way of a placing of 100,000,000 new ordinary shares. Align
Research Ltd converted £100,000 of its loan (as referred to in the previous paragraph) together with the interest thereon into
11,131,500 ordinary shares and Dennis Edmonds agreed to convert £50,000 of outstanding salary into 5,000,000 shares.
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KAZERA GLOBAL PLC
Outlook
As the business becomes cashflow positive, we intend to continue to deliver growth and value for our shareholders through
reinvestment of the proceeds into resource definition and mining at our Deep Blue and WHM projects in South Africa.
In addition to our significant organic growth potential, the team at Kazera continues to seek to maximise value by evaluating potential
M&A opportunities available to the business. In the event that a disposal of one of our assets took place we would look to making a
distribution to shareholders. The Board is also actively investigating ways to distribute to shareholders a substantial portion of the
proceeds received from the sale of assets.
Dennis Edmonds
Chief Executive Officer
15 March 2023
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KAZERA GLOBAL PLC
STRATEGIC REPORT
For the year ended 30 June 2022
The Directors present their strategic report on the Group for the year ended 30 June 2022.
PRINCIPAL ACTIVITY AND BUSINESS REVIEW
The principal activity of the Group is to act as an investor in the resources and energy sectors. The Group was focused on its Tantalite
and Lithium projects in Namibia and its diamond and heavy Mineral Sands mine in South Africa; its projects in Namibia were disposed
of post-period end. As at 30 June 2022, the Group was also in the process of undertaking due diligence into a Rare Earth Element
exploration project in Kenya. The Group may be either an active investor and acquire control of a single company or it may acquire
non-controlling shareholdings.
The Directors recommend that there is no dividend payment for the year ended 30 June 2022 (2021: nil).
The review of the period is contained within the Chairman’s Statement.
The Chairman’s Statement provides a balanced and comprehensive analysis of the future developments, performance and results of
the Group during the period and of the balance sheet position of the Group at the end of that period in the context of the Group’s
current activities (which are set out in the CEO’s report on page 3), taking into consideration the disposal of the Group’s interest in
Namibia post period end.
INVESTING POLICY
Kazera Global plc (the “Company”) seeks to achieve shareholder return primarily via capital appreciation through direct investments
in companies and projects primarily in, but not limited to, Africa within the mining and resource sectors (the “Target Sectors”)
including traditional direct investments in securities and similar financial instruments including any combination of the following:
(a) equity securities (predominantly unlisted);
(b) listed and unlisted debt securities that may be rated or not rated (bonds, debt instruments, convertible bonds and bonds
with warrants, fund-linked notes with a capital guarantee, loan facilities etc.); and
(c) hybrid instruments.
The Company may exploit a wide range of investment opportunities within the Target Sectors as they arise and, to this end, the
Company has complete flexibility in selecting the specific investment and trading strategies that it sees fit in order to achieve its
investment objective. In this regard, the Company may seek to gain Board representation and/or managerial control in its underlying
investments if it deems to be the best way of generating value for shareholders.
Opportunities will be chosen through a careful selection process which will appraise both the fundamental factors specific to the
opportunity as well as wider economic considerations. Typical factors that will be considered are the strength of management, the
quality of the asset base, the investment’s scale and growth potential, the commodity price outlook, any geopolitical concerns, the
underlying financial position, future working capital requirements as well as potential exit routes. Investments may be in the form of
buy-outs, controlling positions (whether initially or as a result of additional or follow-on investments) or strategic minority
investments.
There is no fixed limit on the number of projects or companies into which the Company may invest, nor the proportion of the
Company’s gross assets that any investment may represent at any time.
No material change will be made to the Company’s investing policy without the approval of shareholders.
KEY PERFORMANCE INDICATORS
The Group considers investment value and return on investment as its principal key performance indicators. This is monitored
quarterly and reviewed at Board meetings. The Directors believe the return on investment to be a fair representation of business for
the year. The Company has provided further finance to its subsidiaries.
Key Performance Indicator
Investment1
Return on investment2
30 June 2022
£’000
3,298
-61%
30 June 2021
£’000
3,114
-36%
1 see investment in subsidiaries (Note 14)
2 Loss attributable to owners of the Company in the year divided by the Investment amount
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KAZERA GLOBAL PLC
STRATEGIC REPORT (continued)
For the year ended 30 June 2022
PRINCIPAL RISKS AND UNCERTAINTIES
The Group’s business is to identify, make, manage and realise investments in accordance with the Group’s stated investing policy.
The Directors consider the following risks to be the most material or significant for the management of the business. These issues do
not purport to be a complete list or explanation of all the risk factors facing the Group. In particular, the Group’s performance may
be affected by changes in the market and/or economic conditions and changes in legal, regulatory or tax requirement legislation.
Additional risks and uncertainties not presently known by the Group or that the Group currently deems immaterial may also impact
the business.
The Board of Directors monitors these risks and the Group’s performance on a regular basis, considering investment proposals, the
performance of investments made and opportunities for divestment as appropriate as well as considering the actual performance of
the Group against budgets.
•
Political and Country Risk
Substantially all of the Group’s business and operations are conducted in Namibia and South Africa. The political, economic, legal and
social situation in Namibia and South Africa introduces a certain degree of risk with respect to the Group’s activities. The governments
of Namibia and South Africa exercise control over such matters as exploration and mining license, permitting, exporting and taxation,
which may adversely impact the Group’s ability to carry out exploration, development and mining activities.
Government activity, which could include non-renewal of licenses, may result in any income receivable by the Group being adversely
affected. In particular, changes in the application or interpretation of mining and exploration laws and/or taxation provisions in
Namibia could adversely affect the value of the Group’s interests.
The Group’s risks are mitigated by liaison with the local governments and union representatives as well as continuous monitoring of
local situations. The Group’s exposure to Namibia in this regard has now been mitigated by the post-year-end disposal of the
operations in Namibia, for which the acquirer is now responsible.
•
Exploration and Development Risk
The exploration for and the development of mineral deposits involves significant risks, which even a combination of careful
evaluation, experience and knowledge may not eliminate. While the discovery of an ore body may result in substantial rewards, few
properties which are explored ultimately develop into producing mines. Major resources are required to establish ore reserves, to
develop metallurgical processes and to construct mining and processing facilities. In respect of the Namibian site this risk has been
substantially mitigated by the disposal transaction per period end that previously referred to above.
There is no certainty that the exploration and development expenditures made by the Group as described in these financial
statements will result in a commercially feasible mining operation. There is aggressive competition within the mining industry for the
discovery and acquisition of properties considered to have commercial potential. The Group will compete with other companies,
many of which have greater financial resources, for the opportunity to participate in promising projects. Significant capital investment
is required to achieve commercial production from successful exploration efforts.
The commercial viability of a deposit is dependent on a number of factors. These include deposit attributes such as size, grade and
proximity to infrastructure; current and future market prices which can be cyclical; government regulations including those relating
to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. The effect of
these factors, either alone or in combination, cannot be entirely predicted, and their impact may result in the Group not receiving an
adequate return on invested capital.
There is no assurance the Group will be able to adhere to the current development and production schedule or that the required
capital and operating expenditure will be accurate. The Group’s development plans may be adversely affected by delays and the
failure to obtain the necessary approvals, licenses or permits to commence production or technical or construction difficulties which
are beyond the Group’s control. Operational risks and hazards include: unexpected maintenance, technical problems or delays in
obtaining machinery and equipment, interruptions from adverse weather conditions, industrial accidents, power or fuel supply
interruptions and unexpected variations in geological conditions.
Exploration risk is mitigated by using independent third-parties to determine the resource availability (JORC reports) and the
operational risk is mitigated by using high-quality skilled drilling contractors.
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KAZERA GLOBAL PLC
STRATEGIC REPORT (continued)
For the year ended 30 June 2022
PRINCIPAL RISKS AND UNCERTAINTIES (continued)
•
Unable to invest
The Directors may be unable to identify investments which are consistent with the Group’s investment policy and which are available
at a price which the Directors consider suitable, which would limit the potential for the Group’s value to grow.
The Board is comprised of experienced mining executives with significant experience in sourcing investment opportunities, and has
engaged professional advisers, each of whom has access to a broad network through which opportunities are frequently referred.
Shareholders in the Company may also bring to the Board’s attention, projects which they believe to be consistent with the Group’s
investment policy.
•
Unavailability of finance
The Directors may identify suitable investments at what they believe to be a suitable price but which may require more funds than
are available to the Group and the Group may then be unable to raise further funds at all or on terms which the Directors consider
acceptable.
The Group is listed on the public markets providing enhanced access to capital in the event that this was required. The Company’s
disposal of its interests in Namibia in December 2022 and move towards cash generative production during the year ending 30 June
2023 also reduces the Company’s funding requirements.
•
Covid-19
The Group’s operations are principally in Namibia and South Africa where Covid-19 has had a significant impact on the local
economies. The following has been implemented by the Group:
Health and safety – The Group has published policies on operating within the current government and international guidelines to
ensure our personnel remain safe. No significant outbreaks of Covid-19 have been identified within our operational vicinity, however
should there be a significant outbreak, operations will be adversely affected. The current guidelines implemented by the Group have
limited financial impact in the short term, and as government restrictions are being eased in these regions, the Group does predict a
long-term effect on the results.
Localised and national lockdowns – To date, there have been limited lockdowns in the specific regions in which Kazera operate. Going
forward there is a risk that should tighter restrictions be enforced leading to reduced activity, both future development as well as
mining operations may be impacted.
•
Investment risk
Once an investment has been made, the underlying business invested in may not perform as the Directors had expected and this
may impair or eliminate the value of the Group’s investment.
The management team closely monitors performance of each activity and takes corrective action where necessary.
•
Realisation risk
Once an investment has been made, it may not prove possible to realise the investment at the time the Directors intend or only to
realise it at a value which damages the Group’s value.
The Management team are highly experienced at sourcing opportunities and adding value to assets until such time as an acceptable
return on investment can be realised as demonstrated by the Group’s disposal of its interest in Namibia.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Note 24 to the financial statements sets out the financial risks to which the Group is exposed, together with its policies for managing
these risks.
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KAZERA GLOBAL PLC
STRATEGIC REPORT (continued)
For the year ended 30 June 2022
PROMOTION OF THE COMPANY FOR THE BENEFIT OF THE MEMBERS AS A WHOLE
The Director’s believe they have acted in the way most likely to promote the success of the Company for the benefit of its members
as a whole, as required by s172 of the Companies Act 2006.
The section specifies that the Directors must act in good faith, when promoting the success of the Company and in doing so have
regard (amongst other things) to:
Consider the likely consequences of any decision in the long term,
Act fairly between the members of the Company,
•
•
• Maintain a reputation for high standards of business conduct,
•
•
•
Consider the interests of the Company’s employees,
Foster the Company’s relationships with suppliers, customers and others, and
Consider the impact of the Company’s operations on the community and the environment.
The Company is quoted on AIM and its members will be fully aware, through detailed announcements, shareholder meetings and
financial communications, an updated website, of the Board’s broad and specific intentions and the rationale for its decisions. The
Company has complied with all its obligations under AIM rule 26. The Company went through a period of continued development
and evolution during the period 2021-2022. The Directors worked during the year and after year end to increase its reach with regards
to mining rights in various countries which sets the stage for further growth and development.
When selecting investments, issues such as the impact on the community and the environment have actively been taken into
consideration. The Company strives to comply with all local environmental legislation, and takes its responsibility to the environment
very seriously. Post year-end, the Company had focused on water recycling projects at its processing plant in the Tantalite Valley.
This has also been timed with equity and investments designed to advance the business for the benefit of all stakeholders, including
shareholders, employees and suppliers while minimising the effects of dilution and capital costs on the shareholders and the business.
The Company pays its employees and creditors promptly and keeps its costs to a minimum to protect shareholders funds. The
Company recognises, communicates with workers’ representation unions and complies with all local employment legislation. There
were no outstanding employment disputes at 30 June 2022.
Decision Making and Implementation
The Board is collectively responsible for the decisions made towards the long-term success of the Company and how the strategic,
operational and risk management decisions have been implemented throughout the business, this is detailed in this Strategic Review
Report on pages 5 to 10.
Maintaining High Standards of Business Conduct
The Board places great importance on this aspect of corporate life, where failure could put the Company at risk, and seeks to ensure
that this flows through all its business interactions and at all levels of the Company. The Board upholds the importance of sound
ethical values and behaviour not only because it is important to the Company to successfully achieve its corporate objectives and to
transmit this culture throughout the organisation but also to set a benchmark and send a signal of what it will and will not do in some
of the jurisdictions in which the Company operates.
The Company is incorporated in the UK and governed by the Companies Act 2006, the Group’s business operations are carried out
within the UK and Internationally, which requires the Company to conform with the various statutory and regulatory provisions in
the UK as well as in other locations in which it operates. The Company has adopted the Quoted Companies Alliance Corporate
Governance Code 2018 (the ‘QCA Code’) and the Board recognises the need to maintain a high standard of corporate governance as
well as to comply with AIM Rules to safeguard the interest of the Company’s stakeholders. The corporate governance arrangements
that the Board has adopted, together with a punctilious observance of applicable regulatory requirements also form part of the
corporate culture, requiring a standard of behaviour when interacting with contractors, business partners, service providers,
regulators and others. For example, the Company has adopted an Anti-Corruption and Bribery Policy, Whistleblowing Policy, HR and
H&S Policies that dictate acceptable behaviour as well as the Share Dealing Code for Directors and employees, required for the AIM
listed companies and in accordance with the requirements of the Market Abuse Regulation, which came into effect in 2016. Staff
training on anti-corruption and anti-bribery is monitored and refresher courses are provided as when required to ensure that the
issues of bribery and corruption remain at the forefront of peoples’ mind.
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KAZERA GLOBAL PLC
STRATEGIC REPORT (continued)
For the year ended 30 June 2022
Employee Engagement
The Board recognises that its employees are one its key resources, which enables delivering the Company’s vision and goals. Annual
pay and benefit reviews are carried out to determine whether all levels of employees are benefited equally and to retain and
encourage skills vital for the business. The Board encourages management to improve employee engagement and to provide
necessary training in order to use their skills in the relevant areas in the business. The Board periodically reviews the health and
safety measures, implemented in the business premises and improvements are recommended for better practices.
Employees are informed of the results and important business decisions to stimulate their engagement and are encouraged to
improve their skills and career potential.
Suppliers, Customers and Regulatory Authorities
The Board acknowledges that a strong business relationship with suppliers and customers is a vital part of the growth. Whilst day to
day business operations are delegated to the executive management, the Board sets directions with regard to new business ventures.
The Board upholds ethical behaviour across all sectors of the business and encourages management to seek comparable business
practices from all suppliers and customers doing business with the Company. We value the feedback we receive from our
stakeholders and we take every opportunity to ensure that, where possible, their wishes are duly considered.
Shareholder Engagement
The Board places equal importance on all shareholders and recognises the significance of transparent and effective communications
with shareholders. As an AIM listed company, there is a need to provide fair and balanced information in a way that is understandable
to all stakeholders and particularly our shareholders.
The Board recognises that it is accountable to shareholders for the performance and activities of the Company and is committed to
providing effective communication with its shareholders. Significant developments are disseminated through stock exchange
announcements. The changes to the Board and Board Committees, changes to major shareholder information, QCA Code disclosure
updates are promptly published on the website to enable the shareholders to be kept abreast of the Company’s affairs. The
Company’s Annual Report and Notice of Annual General Meetings (AGM) are available to all shareholders and the Interim Report
and other investor presentations are also available for the last five years and can be downloaded from the Company’s website
www.kazeraglobal.com.
Shareholders can attend the Company’s Annual General Meetings and any other shareholder meetings held during the year, where
they can formally ask questions, raise issues and vote on the resolutions as well as engage in a more informal one-to-one dialogue
with the executive Directors.
Community and Environment
The Board recognises that the long-term success of the Company will be enhanced by good relations with different internal and
external groups and to understand their needs, interests and expectations.
Kazera is committed to sustainable natural resource investment and development worldwide and recognises a responsibility to
protect the environments in which it operates. The Company seeks to manage and mitigate environmental risks as well as to minimise
the overall impact of our operations on the people and countries in which we operate. The Board encourages that good relations are
cultivated with local governments and communities, aiming to better understand various parties’ aspirations and ensure that the
Company’s business activities are compliant not only with local and global laws, including environmental laws, but also where possible
take account of local expectations and priorities.
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KAZERA GLOBAL PLC
STRATEGIC REPORT (continued)
For the year ended 30 June 2022
GOING CONCERN
The financial statements have been prepared assuming the Group and Company will continue as a going concern.
In assessing whether the going concern assumption is appropriate, the directors have taken into account all available information for
the foreseeable future; in particular for the 12 months from the date of approval of these financial statements and performed
sensitivity analysis thereon. This assessment includes consideration of the cash receipts arising from the disposal of the Group’s
operations in Namibia, future plans, expenditure commitments in place, cost reduction measures that can be implemented and
permitting requirements. The Directors estimates are dependent upon the Group’s mining operations coming into operation as
planned. In the event that this does not occur the Directors are confident that further funds could be raised to meet any shortfall.
In May 2022, the Company raised £1 million before expenses by way of a share placing.
On 20 December 2022, the Company announced an agreement for the sale of Kazera's interest in 100% of the shares in African
Tantalum to Xinjian for a headline sum of US$13 million (excluding interest at 8% on loans of c. US$9.3 million made by Kazera to
African Tantalum). On signing of these agreements, Kazera received a payment of US$642k, and has since received further payments
of approximately US$1,625k, far exceeding the contracted amount required under the agreement at this stage. Monthly receipts
under the agreement are due to commence from April 2023.
This report was approved by the board of Directors on 15 March 2023 and signed on its behalf by
Dennis Edmonds
Chief Executive Officer
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KAZERA GLOBAL PLC
DIRECTORS’ REPORT
For the year ended 30 June 2022
The Directors present their annual report and audited financial statements for the year ended 30 June 2022.
DIRECTORS
The Directors who served throughout the year and at the date of this report, were as follows:
Giles Clarke – Chairman – resigned 8 July 2022
Giles Clarke was appointed as a director on 25 March 2014 and was independent on appointment as Chairman. He was formerly
Chairman of AIM quoted Amerisur Resources plc prior to its disposal in 2020, is Chairman of Westleigh Investments Holdings Limited
and AIM quoted Ironveld plc. He began his career as an investment banker with Credit Suisse First Boston before successfully
establishing, building and selling a number of high-profile businesses including Majestic Wine, Pet City plc and Safestore plc. He is
also Chairman of several private organisations.
Gerard Kisbey-Green – Chairman - appointed on 18 July 2022
Mr Kisbey-Green, a qualified Mining Engineer, has over 36 years' experience in the mining and related financial industry and has
worked on mines in a diversity of commodities and geographies both as an engineer and as a banker. Mr. Kisbey-Green has also held
the position of CEO for a number of private and listed mining and exploration companies in addition to holding numerous non-
executive board positions. Mr Kisbey-Green has 17 years of resource banking experience including a period in equity analysis as well
as a corporate financier for major banks in Johannesburg and London including JPMorgan, Investec, and Standard Bank.
Larry Johnson – Chief Executive Officer – resigned 20 October 2021
Larry Freeman Johnson has more than 25 years' experience in the tantalum industry having worked with two large US based publicly
listed companies with core interests in tantalum. Throughout his career, Larry has held several senior key positions, most recently as
Director: Mining and Global Tantalum Supply Chain at KEMET Electronics Corporation, and significantly he has spent several years
focussing on the development of conflict-free global supply chains.
Dennis Edmonds – Chief Executive Officer
Mr Edmonds has a wealth of experience in board level positions in investment banking and venture capital industries. Most recently,
Mr Edmonds was executive Chairman of AIM-quoted Alien Metals Limited and CEO of Pathfinder Minerals PLC.
Odilon Ilunga – Executive Technical Director – resigned on 14 March 2023
Mr Ilunga is a Metallurgist and Civil Engineer having graduated with a master's degree in metallurgical engineering from the University
of Witwatersrand. Having begun his career in mining at Ongolopo Mining Limited in 2004 before moving to Weatherly Mining Namibia
in 2010, Mr Ilunga was appointed Operations Manager at African Tantalum in 2017, in charge of tantalum ore concentration and
development strategies for the processing plant.
Nick Harrison – Non-Executive Director – resigned on 8 July 2022
Nick Harrison was appointed as a director on 25 March 2014 and was independent on appointment. He was formerly Finance Director
of AIM quoted Amerisur Resources plc prior to its sale in 2020, and a Non-executive Director of Ironveld plc. Mr Harrison has held
Board positions at a number of private companies with international activities. He is a Chartered Accountant, having qualified with
Arthur Andersen before holding senior roles with Deloitte, Midland Bank (International) and Coopers & Lybrand.
Geoffrey Eyre - Non-Executive Director - appointed on 8 July 2022
Geoffrey Eyre was appointed on 8 July 2022. He is an experienced finance professional with more than 17 years of experience holding
senior positions with companies in the mining industry including producing assets, exploration and development stage companies
and private equity investment funds. Most recently, Mr. Eyre was the CFO of Adriatic Metals plc. He is a Chartered Accountant,
member of the ICAEW and holds a first-class honours degree in Electrical Engineering from the University of Warwick
11 | P a g e
KAZERA GLOBAL PLC
DIRECTORS’ REPORT (continued)
For the year ended 30 June 2022
DIRECTORS’ INTERESTS
The Directors who held office during the period and their beneficial interest in the ordinary shares of the Company were as follows:
G Clarke* (Resigned on 8 July 2022)
N Harrison* (Resigned on 8 July 2022)
L Johnson (Resigned on 20 October 2021)
D Edmonds
O Ilunga (Resigned on 14 March 2023)
30 June 2022
30 June 2021
Number
19,832,743
20,499,409
500,000
5,000,000
-
% held
2.83%
2.93%
0.07%
0.53%
-
Number
19,832,743
20,499,409
500,000
-
-
% held
2.83%
2.93%
0.07%
-
-
* Westleigh Investments Holdings Limited (a company beneficially owned by Giles Clarke and Nick Harrison), holds 15,138,095 (2021:
15,138,095) ordinary shares in addition to the personal holdings shown above. Please refer to Note 26 for further details on the
Related Party Transaction.
CAPITAL STRUCTURE
Details of the issued share capital are shown in Note 21. The Company has one class of ordinary shares which carries no right to fixed
income. Each share carries the right to one vote on a poll at general meetings of the Company.
There are no specific restrictions on the size of a holding nor on the transfer of shares, which are both governed by the provisions of
the Articles of Association and prevailing legislation. The Directors are not aware of any agreements between holders of the
Company’s shares that may result in restrictions on the transfer of securities or on the exercise of voting rights.
No person has any special rights of control over the Company’s share capital and all issued shares are fully paid.
With regard to the appointment and replacement of directors, the Company is governed by its Articles of Association, the Companies
Acts and related legislation. The Articles themselves may be amended by special resolution of the shareholders.
EVENTS AFTER THE REPORTING PERIOD
Note 25 details the events after the reporting period.
EMPLOYEES
The Group is an equal opportunities employer.
SUBSTANTIAL SHAREHOLDINGS
Other than as stated below, as far as we are aware, there are no persons with significant direct or indirect holdings in the Company.
Information provided to the company pursuant to the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules
(DTR 5) is published on a Regulatory Information Service and on the company’s website, www.kazeraglobal.com.
As at 9 March 2023, the Company has received notifications in accordance with DTR 5 of the following notifiable interests in the
voting rights in the company’s issued share capital:
Align Research Ltd & Related Parties R S & C A Jennings
Spreadex Ltd
Tracarta Limited
Giles Clarke & Westleigh Investments Holdings Ltd
Number of ordinary
shares
206,381,500
69,380,000
43,181,095
37,209,900
% of ordinary share
capital and voting
rights
22.02%
7.40%
4.61%
3.97%
12 | P a g e
DIRECTORS’ REPORT (continued)
For the year ended 30 June 2022
As at 2 March 2023, the registered holders of 3% or more of the Ordinary shares in the capital of the Company were as follows;
KAZERA GLOBAL PLC
Fiske Nominees Limited FISKPOOL a/c
JIM Nominees Limited JARVIS a/c
Hargreaves Lansdowne (Nominees) Ltd HLNOM a/c
Interactive Investor Services Nominees Limited SMKTISAS a/c
Chase Nominees Limited
Hargreaves Lansdown (Nominees) Limited 15942 a/c
GHC Nominees Limited POOL a/c
The Bank of New York (Nominees) Limited 672938 a/c
Spreadex Limited
Hargreaves Lansdown (Nominees) Limited VRA a/c
Interactive Investor Services Nominees Limited SMKTNOMS a/c
ISI Nominees Limited ADMAGT a/c
Number of ordinary
shares
192,147,044
52,406,712
50,057,360
47,400,114
43,191,095
39,973,851
38,570,837
37,142,721
35,000,000
34,110,508
31,629,547
30,000,000
% of ordinary share
capital and voting
rights
20.50%
5.59%
5.34%
5.06%
4.61%
4.27%
4.12%
3.96%
3.73%
3.64%
3.38%
3.20%
STATEMENT OF DISCLOSURE TO INDEPENDENT AUDITORS
Each of the persons who is a director at the date of approval of this report confirms that:
•
•
So far as the Director is aware, there is no relevant audit information of which the Company’s auditor is unaware; and
The Director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant
audit information and to establish that the Company’s auditor is aware of that information.
INDEPENDENT AUDITOR
PKF Littlejohn LLP have expressed their willingness to continue in office as auditor and will be proposed for reappointment at the
next Annual General Meeting.
This report was approved by the board of Directors on 15 March 2023 and signed on its behalf by
Dennis Edmonds
Director
13 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT
The Directors recognise the importance of sound corporate governance while taking into account the Group’s size and stage of
development.
With effect from 28 September 2018, corporate governance regulations apply to all AIM quoted companies and require the Company
to:
•
•
provide details of a recognised corporate governance code that the board of directors has decided to apply
explain how the Company complies with that code, and where it departs from its chosen corporate governance code provide
an explanation of the reasons for doing so.
The corporate governance disclosures need to be reviewed annually, and the company is also required to state the date on which
these disclosures were last reviewed. This Chairman’s Corporate Governance Statement sets out how Kazera seeks to comply with
these requirements.
The Directors acknowledge that they have overall responsibility for the Company’s system of internal control and for reviewing its
effectiveness. Such a system is designed to manage rather than eliminate the risk of failure to achieve business objectives and even
the most effective system can provide only reasonable, and not absolute, assurance with respect to the preparation of financial
information and the safeguarding of assets. The close involvement of the Directors in all decisions and actions undertaken by the
Company is intended to ensure that the risks to the Company are minimised.
Overview
As Chairman of the Board of Directors of Kazera Global plc (Kazera, We, or the Company/Group as the context requires), it is my
responsibility to ensure that Kazera has both sound corporate governance and an effective Board. Kazera is an AIM listed investing
company whose principal activity is as an investor in the resources and energy sectors. The Group is focused on projects located in
Southern Africa but will also consider investments in other geographical regions.
Kazera’s Board has adopted the principles of the Quoted Companies Alliance Corporate Governance Code 2018 Edition (QCA Code)
in accordance with the London Stock Exchange’s recent changes to the AIM Rules, requiring all AIM-listed companies to adopt and
comply or explain non-compliance with a recognised corporate governance code. The QCA Code identifies ten principles to be
followed in order for companies to deliver growth in long term shareholder value, encompassing an efficient, effective and dynamic
management framework accompanied by communication to promote confidence and trust. This report follows the structure of these
guidelines and explains how we have applied the guidance as well as disclosing any areas of non-compliance. We will provide annual
updates on our compliance with the QCA Code. The Board considers that the Group complies with the QCA Code so far as it is
practicable having regard to the size, nature and current stage of development of the Company, and will disclose any areas of non-
compliance in the text below.
The sections below set out the ways in which the Group applies the ten principles of the QCA Code in support of the Group’s medium
to long-term success.
Key governance changes during the year include the formal adoption of the QCA Code.
QCA Principles
Establish a strategy and business model which promotes long-term value for shareholders
1.
Kazera Global plc is an investment company focused on opportunities principally, but not exclusively in the resources and energy
sectors. The Company holds 100% of African Tantalum in Namibia, which was subsequently disposed of in December 2022, 90% of
Deep Blue Minerals, a South Africa-based company and 60% of Whale Head Minerals which is also located in South Africa.
Kazera seeks to achieve shareholder return primarily via capital appreciation through the purchase and sale of securities and other
direct investments in companies and projects primarily in, but not limited to, Africa within the mining and resource sectors (the
“Target Sectors”) including traditional direct investments in securities and similar financial instruments including any combination of
the following:
(a) equity securities (predominantly unlisted);
(b) listed and unlisted debt securities that may be rated or not rated (bonds, debt instruments, convertible bonds and bonds
with warrants, fund-linked notes with a capital guarantee, loan facilities etc.); and
(c) hybrid instruments.
14 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT (continued)
QCA Principles (continued)
The Company may exploit a wide range of investment opportunities within the Target Sectors as they arise and, to this end, the
Company has complete flexibility in selecting the specific investment and trading strategies that it sees fit in order to achieve its
investment objective. In this regard, the Company may seek to gain Board representation and/or managerial control in its underlying
investments if it deems to be the best way of generating value for Shareholders.
Opportunities will be chosen through a careful selection process which will appraise both the fundamental factors specific to the
opportunity as well as wider economic considerations. Typical factors that will be considered are the strength of management, the
quality of the asset base, the investment’s scale and growth potential, the commodity price outlook, any geopolitical concerns, the
underlying financial position, future working capital requirements as well as potential exit routes. Investments may be in the form of
buy-outs, controlling positions (whether initially or as a result of additional or follow-on investments) or strategic minority
investments.
There is no fixed limit on the number of projects or companies into which the Company may invest, nor the proportion of the
Company’s gross assets that any investment may represent at any time.
No material change will be made to the Company’s investing policy without the approval of Shareholders.
Challenges to delivering strategy, long-term goals and capital appreciation are uncertain in relation to organisational, operational,
financial and strategic risks, all of which are outlined in the Strategic Report on page 5, as well as steps the Board takes to protect the
Company by mitigating these risks and secure a long-term future for the Company.
Seek to understand and meet shareholder needs and expectations
2.
The Board recognises the importance of communication with its stakeholders and is committed to establishing constructive
relationships with investors and potential investors in order to assist it in developing an understanding of the views of its
shareholders.
Kazera also maintains a dialogue with shareholders through formal meetings such as the AGM, which provides an opportunity to
meet, listen and present to shareholders, and shareholders are encouraged to attend in order to express their views on the
Company’s business activities and performance. Members who have queries regarding the Company’s AGM can contact the
Company’s Registrars, Link Asset Services on the Shareholder helpline which is 9871 664 0300 or +44 (0)371 664 0300 if calling from
outside the UK.
The Board welcomes feedback from key stakeholders and will take action where appropriate and the Chairman of the Board is the
shareholder liaison, and meets shareholders regularly, and informs other directors of their views and suggestions. Analysts provide
the Board with updates on the Company’s business and how strategy is being implemented, as well as to hear views and expectations
from shareholders. The views of the shareholders expressed during these meetings are reported to the Board, ensuring that all
members of the Board are fully aware of the thoughts and opinions of shareholders.
As part of our commitment to shareholder engagement we have been seeking the views of shareholders through outreach campaigns
and roadshows. The Company maintains effective contact with its principal shareholders and welcomes communications from its
private investors. The Company’s Financial PR contact details are listed on the website where a contact form is also included.
The Company also has a social media account (Twitter) through which the Company maintains a dialogue with shareholders and
interested parties.
Information on the Investor Relations section of the Company’s website is kept updated and contains details of relevant
developments, Annual and Interim Results, Regulatory News Service announcements, presentations and other key information.
3.
Take into account wider stakeholder and social responsibilities and their implications for long-term success
The Board recognises that the long-term success of the Company is reliant upon the efforts of employees, regulators and many other
stakeholders. The Board has put in place a range of processes and systems to ensure that there is close oversight and contact with
its key resources and relationships. The Company prepares and updates its strategic plan regularly together with a detailed rolling
budget and financial projections which consider a wide range of key resources including staffing, consultants and utility providers.
The Board is kept updated on questions / issues raised by stakeholders and incorporates information and feedback into future
decision making.
15 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT (continued)
QCA Principles (continued)
Kazera fully abides by the provisions of the 2015 Modern Slavery Act. In accordance with its Code of Business Conduct and Ethics,
Kazera opposes the crime of slavery in all of its forms, including child labour, servitude, forced or compulsory labour and human
trafficking. Employee feedback is not relevant at present given retrenchment and realignment of activities.
All employees within the Group are valued members of the team, and the Board seeks to implement provisions to retain and
incentivise all its employees. The Group offers equal opportunities regardless of race, gender, gender identity or reassignment, age,
disability, religion or sexual orientation. The directors are in constant contact with employees and seek to provide continual
opportunities in which issues can be raised allowing for the provision of feedback. This feedback process helps to ensure that new
issues and opportunities that arise may be used to further the success of the Company. Share options and other equity incentives
are offered to employees. Kazera complies fully with all Namibian employment legislation.
4.
Embed effective risk management, considering both opportunities and threats, throughout the organisation
The Board recognises the need for an effective and well-defined risk management process and it oversees and regularly reviews the
current risk management and internal control mechanisms.
The Board regularly reviews the risks facing the Company as detailed in the Strategic Report on page 5 and seeks to exploit, avoid or
mitigate those risks as appropriate. The Board is responsible for the monitoring of financial performance against budget and forecast
and the formulation of the Company’s risk appetite including the identification, assessment and monitoring of Kazera’s principal risks.
Additionally, the Board reviews the mechanisms of internal control and risk management it has implemented on an annual basis and
assesses both for effectiveness.
On the wider aspects of internal control, relating to operational and compliance controls and risk management, the Board, in setting
the control environment, identifies, reviews, and regularly reports on the key areas of business risk facing the Group.
The Group Board and subsidiary Boards maintain close day to day involvement in all of the Group’s activities which enables control
to be achieved and maintained. This includes the comprehensive review of both management and technical reports, the monitoring
of interest rates, environmental considerations, government and fiscal policy issues, employment and information technology
requirements and cash control procedures. In this way, the key risk areas can be monitored effectively, and specialist expertise
applied in a timely and productive manner.
The effectiveness of the Group’s system of internal financial controls, for the year to 30 June 2022 and for the period to the date of
approval of the financial statements, has been reviewed by the Directors. Whilst they are aware that although no system can provide
for absolute assurance against material misstatement or loss, they are satisfied that effective controls are in place.
5. Maintain the Board as a well-functioning, balanced team led by the Chair
The Board recognises the QCA recommendation for a balance between Executive and Non-Executive Directors and the
recommendation that there be at least two Independent Non-Executives. The Board currently comprises of two Executive Directors
and two Non-Executive Directors. The Board will take this into account when considering future appointments. However, all Directors
are encouraged to use their judgement and to challenge matters, whether strategic or operational, enabling the Board to discharge
its duties and responsibilities effectively. The Board maintains that the Board’s composition will be frequently reviewed as the
Company develops, however, as the Company is small the current Board reflects this and it is not deemed appropriate to have audit,
remuneration or nominations committees. For the moment, the responsibilities which would normally be assumed by the
Nominations committee are assumed by the Board as a whole and the responsibilities of the Audit and Remuneration committees
are assumed by the two Non-Executive Directors in specific sessions of the Board.
The Group is controlled and led by the Board of Directors with an established schedule of matters reserved for their specific approval.
The Board meets regularly throughout the year and is responsible for the overall Group strategy, acquisition and divestment policy,
approval of major capital expenditure and consideration of significant financial matters. It reviews the strategic direction of the
Company and its individual subsidiaries, their annual budgets, their progress towards achievement of these budgets and their capital
expenditure programmes.
The role of the Chairman is to supervise the Board and to ensure its effective control of the business, and that of the Chief Executive
is to manage the Group on the Board’s behalf. All Board members have access, at all times, to sufficient information about the
business, to enable them to fully discharge their duties. Also, procedures exist covering the circumstances under which the Directors
may need to obtain independent professional advice.
16 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT (continued)
QCA Principles (continued)
The Board meets regularly and is responsible for formulating, reviewing and approving the Group’s strategy, budgets, performance,
major capital expenditure and corporate actions. Detailed biographies of the Board members can be found on the website and in the
Directors’ Report on page 11. Giles Clarke was independent on appointment as Chairman and Nick Harrison was independent on
appointment. The Board has subsequently changed with the resignation of L Johnson. The external time commitments are reported
upon in the director’s biographies.
Throughout the year, there have been four Board meetings, with all Directors in attendance. The Directors of the Company are
committed to sound governance of the business and each devotes enough time to ensure this happens.
Directors’ conflict of interest
The Board is aware of the other commitments and interests of its Directors, and changes to these commitments and interests are
reported to and, where appropriate, agreed with the rest of the Board.
6.
Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities
The Company believes that the current balance of skills in the Board as a whole reflects a very broad range of personal, commercial
and professional skills, and notes the range of financial and managerial skills. The Non-Executive Director maintains ongoing
communications with Executives between formal Board meetings.
Biographical details of the Directors can be found on the Company’s website and in the Directors’ Report on page 11 of this report.
Brian James is the Company Secretary and helps Kazera comply with all applicable rules, regulations and obligations governing its
operation. The Company’s NOMAD assists with AIM matters and ensures that all Directors are aware of their responsibilities. The
company can also draw on the advice of its solicitors.
The Directors have access to the Company’s NOMAD, Company Secretary, lawyers and auditors as and when required and are able
to obtain advice from other external bodies when necessary. If required, the Directors are entitled to take independent legal advice
and if the Board is informed in advance, the cost of the advice will be reimbursed by the Company.
Board composition is always a factor for consideration in relation to succession planning. The Board will seek to consider any Board
imbalances for future nominations, with areas considered including board independence and gender balance. The Group considers
however that at this stage of its development and given the current size of its Board, it is not necessary to establish a formal
Nominations Committee. Instead, the appointments to the Board are made by the Board as a whole and this position is reviewed on
a regular basis by the Board.
7.
Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
The Directors consider that the Company and Board are not yet of a sufficient size for a full Board evaluation to make commercial
and practical sense. In the frequent Board meetings/calls, the Directors can discuss any areas where they feel a change would benefit
the Company, and the Company Secretary remains on hand to provide impartial advice. As the Company grows, it expects to expand
the Board and with the Board expansion, re-consider the need for Board evaluation.
The Board continues to conduct internal and external Board evaluations which consider the balance of skills, experience,
independence and knowledge of the Company. The evaluation process, the Board refreshment, use of third-party search companies
and succession planning elements are discussed.
The Board evaluation of the CEO’s performance is carried out on an annual basis. Given the level of activity and size of the Company,
no other evaluation is seen as appropriate.
In view of the size of the Board, the responsibility for proposing and considering candidates for appointment to the Board as well as
succession planning is retained by the Board. All Directors submit themselves for re-election at the AGM at regular intervals.
17 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT (continued)
QCA Principles (continued)
Promote a corporate culture that is based on ethical values and behaviours
8.
The Board recognises that its decisions regarding strategy and risk will impact the corporate culture of the Company as a whole and
that this will impact the performance of the Company. The Board is aware that the tone and culture set by the Board will greatly
impact all aspects of the Company as a whole and the way that employees behave. The corporate governance arrangements that the
Board has adopted are designed to ensure that the Company delivers long term value to its shareholders, and that shareholders have
the opportunity to express their views and expectations for the Company in a manner that encourages open dialogue with the Board.
Therefore, the importance of sound ethical values and behaviours is crucial to the ability of the Company to successfully achieve its
corporate objectives.
The Board places great importance on the responsibility of accurate financial statements and auditing standards comply with Auditing
Practice Board’s (APB’s) and Ethical Standards for Auditors. The Board places great importance on accuracy and honesty, and seeks
to ensure that this aspect of corporate life flows through all that the Company does.
A large part of the Company’s activities is centred upon an open and respectful dialogue with employees, clients and other
stakeholders. Therefore, the importance of sound ethical values and behaviours is crucial to the ability of the Company to successfully
achieve its corporate objectives. The Directors consider that the Company has an open culture facilitating comprehensive dialogue
and feedback and enabling positive and constructive challenge. Whilst the Company has a small number of employees, the Board
maintains that as the company grows it intends to maintain and develop strong processes which promote ethical values and
behaviours across all hierarchies.
The Board has adopted an anti-corruption and bribery policy (Bribery Policy). The Bribery Policy applies to all Directors and employees
of the Group, and sets out their responsibilities in observing and upholding a zero-tolerance position on bribery and corruption, as
well as providing guidance to those working for the Company on how to recognise and deal with bribery and corruption issues and
the potential consequences.
The Board complies with Rule 21 of the AIM Rules for Companies relating to dealings in the Company’s securities by the Directors
and other Applicable Employees. To this end, the Company has adopted a code for Directors’ dealings appropriate for a company
whose shares are admitted to trading on AIM and takes all reasonable steps to ensure compliance by the Directors and any relevant
employees.
9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the
Board
The Board is committed to, and ultimately responsible for, high standards of corporate governance. The Board reviews the
Company’s corporate governance arrangements regularly and expect to evolve this over time, in line with the Company’s growth.
The Board delegates responsibilities to Committees and individuals as it sees fit.
The Chairman’s principal responsibilities are to ensure that the Company and its Board are acting in the best interests of shareholders.
His leadership of the Board is undertaken in a manner which ensures that the Board retains integrity and effectiveness, and includes
creating the right Board dynamic and ensuring that all important matters, in particular strategic decisions, receive adequate time and
attention at Board meetings.
The Chairman of Kazera is the key contact for shareholder liaison and all other stakeholders.
Executive Directors are responsible for the general day-to-day running of the business and developing corporate strategy.
The CEO has, through powers delegated by the Board, the responsibility for leadership of the management team in the execution of
the Group’s strategies and policies and for the day-to-day management of the business. He is responsible for the general day-to-day
running of the business and developing corporate strategy while the Non-Executive Director is tasked with constructively challenging
the decisions of executive management and satisfying themselves that the systems of business risk management and internal
financial controls are robust.
All Directors participate in the key areas of decision-making, including the following matters:
Strategy
Budgets
Performance
-
-
-
- Major Capital Expenditure
-
Corporate Actions
18 | P a g e
KAZERA GLOBAL PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT (continued)
QCA Principles (continued)
The Board would normally delegate authority to a number of specific Committees to assist in meeting its business objectives, and
the Committees, comprising of at least two independent Non-Executive Directors, would meet independently of Board meetings.
However, the current Board structure does not permit this, and the Directors will seek to take this into account when considering
future appointments. As a result, matters that would normally be referred to the Nominations and AIM rules compliance committees
are dealt with by the Board as a whole. Matters that would normally be referred to the Audit and Remuneration committees are
dealt with by the two Non-Executive directors, Giles Clarke and Nick Harrison, in specific sessions, usually with the CEO in attendance
by invitation. Following the year-end, on 8 July 2022, Giles Clarke and Nick Harrison resigned as directors. Geoffrey Eyre was
appointed as an independent non-executive director on 8 July 2022 and Gerard Kisbey-Green was appointed as Chairman and was
deemed independent upon appointment.
The Chairman and the Board continue to monitor and evolve the Company’s corporate governance structures and processes, and
maintain that these will evolve over time, in line with the Company’s growth and development.
10.
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders
and other relevant stakeholders
The Board is committed to maintaining effective communication and having constructive dialogue with its stakeholders. The
Company intends to have ongoing relationships with both its private and institutional shareholders (through meetings and
presentations), and for them to have the opportunity to discuss issues and provide feedback at meetings with the Company. In
addition, all shareholders are encouraged to attend the Company’s Annual General Meeting. The Board already discloses the result
of General Meetings by way of announcement and discloses the proxy voting numbers to those attending the meetings. In order to
improve transparency, the Board has committed to publishing proxy voting results on its website in the future.
The Company communicates with shareholders through the Annual Report and Accounts, full-year and half-year results
announcements and the Annual General Meeting (AGM). Information on the Investor Relations section of the Group’s website is kept
updated and contains details of relevant developments, regulatory announcements, financial reports and shareholder circulars. A
range of corporate information (including all Company announcements and presentations) is also available to shareholders, investors
and the public on the Company’s corporate website.
A detailed description of the Board Committees can be found on the
www.kazeraglobal.com/corporate-responsibility.
Investor Relations page of the website, at
Shareholders with a specific enquiry can contact us on the website contact page. The Company uses electronic communications with
shareholders in order to maximise efficiency.
Gerard Kisbey-Green
Chairman
15 March 2023
19 | P a g e
KAZERA GLOBAL PLC
DIRECTORS’ REPORT ON REMUNERATION
For the year ended 30 June 2022
REMUNERATION
The remuneration of the Directors is set by the Board as a whole and is reviewed annually. They are remunerated by a fixed fee for
their duties as Directors, but it is anticipated that additional payments may be made where, as a result of the Company’s activities,
the time to be spent by the Directors on the affairs of the Company are greater than envisaged by the fixed fee.
The Company does not provide a pension scheme for employees or Directors and does not contribute to plans established by them.
DIRECTORS’ SERVICE CONTRACTS
The Directors have letters of appointment which commence from their date of appointment and will continue unless terminated in
accordance with the terms of the letter.
DIRECTORS REMUNERATION
Directors’ emoluments for the year are as follows:
G Clarke (Resigned on 8 July 2022)
N Harrison (Resigned on 8 July 2022)
D Edmonds
O Ilunga (Resigned on 14 March 2023)
L Johnson (Resigned on 20 October 2021)
Fees
£’000
50
40
70
11
17
177
Termination Other benefits
£’000
-
-
-
-
-
-
£’000
25
20
-
-
20
65
Year ended
30 June 2022
£’000
75
60
70
11
37
242
Year ended
30 June 2021
£’000
50
40
70
-
124
284
Details of the share options and warrants held by Directors are shown below:
L Johnson (Resigned on 30 October 2021)
G Clarke (Resigned on 8 July 2022)
N Harrison (Resigned on 8 July 2022)
D Edmonds
O Ilunga (Resigned on 14 March 2023)
Number outstanding at
30 June 2022
Number outstanding at
30 June 2021
15,000,000
13,333,333
13,333,333
10,000,000
-
51,666,666
15,000,000
13,333,333
13,333,333
10,000,000
-
51,666,666
This report was approved by the board of Directors on 15 March 2023 and signed on its behalf by
Dennis Edmonds
Director
20 | P a g e
KAZERA GLOBAL PLC
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
For the year ended 30 June 2022
The Directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and
regulations.
Company law requires the Directors to prepare financial statements for each financial period. Under that law the Directors are
required to prepare the Group and Parent Company financial statements in accordance with applicable law and UK-adopted
international accounting standards in conformity with the requirements of the Companies Act 2006. Under company law the
Directors must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the
Group and 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;
state whether applicable UK-adopted international accounting standards in conformity with the requirements of the
Companies Act 2006 have been followed, subject to any material departures disclosed and explained in the financial
statements;
make judgements and accounting estimates that are reasonable and prudent; and
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 Group and
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and
enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding
the assets of the Group and Company 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 financial statements may differ from
legislation in other jurisdictions.
The Company is compliant with AIM Rule 26 regarding the Company’s website.
Gerard Kisbey-Green
Director
15 March 2023
21 | P a g e
KAZERA GLOBAL PLC
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF KAZERA GLOBAL PLC
Opinion
We have audited the financial statements of Kazera Global Plc (the ‘parent company’) and its subsidiaries (the ‘group’) for the year
ended 30 June 2022 which comprise the Group Statement of Comprehensive Income, the Group and Company Statements of
Financial Position, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity, the Group and Company
Statements of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting
framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards 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
June 2022 and of the group’s loss for the year then ended;
the group financial statements have been properly prepared in accordance with UK-adopted international accounting
standards;
the parent company financial statements have been properly prepared in accordance with UK-adopted international
accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements
section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities, and we
have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s and parent
company’s ability to continue to adopt the going concern basis of accounting included obtaining management’s assessment of going
concern and associated forecasts for a minimum of 12 months from the date of approval of the financial statements. We have
reviewed inputs to the forecast financial information, and challenged the applicable assumptions and key estimates, stress-tested
where appropriate, and confirmed that the calculations applied in the forecasts were in accordance with the assumptions and were
mathematically accurate.
We reviewed management’s forecasts up to end of March 2024 as well as comparing the results for the first half of year ending 30
June 2023 with actuals. We noted the sale of African Tantalum (Proprietary) Limited for US$13 million which significantly improves
the cash flow of the group and this together with the current cash balances of the group will be sufficient to cover working capital
and other operational expenditure until the mines have proved sufficient sales. The forecasts indicate positive returns expected in
the year ending 30 June 2023 and the group also obtained funding for upgrades to the plants and investments in new projects.
We confirmed that in January 2023, the group had cash balances of more than £1 million.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the group's or parent company’s ability to continue as a going concern for a
period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of
this report.
Our application of materiality
We apply the concept of materiality in both planning and performing the audit, and in evaluating the effect of misstatements. At the
planning stage, materiality is used to determine the financial statements areas that are included within the scope of the audit and
the extent of sample sizes during the audit.
The materiality applied to the group financial statements was £231,000 (2021: £194,000), based on a percentage of gross assets, as
it is from these assets that the group seeks to deliver returns for shareholders.
As in the prior year, we considered gross assets to be the most significant determinant of the group’s financial position and
performance used by shareholders. This is because the key balances, as reflected in the Statement of Financial Position, are mines
under construction and property plant and equipment. The going concern of the group is dependent on its ability to fund operations
going forward, as well as on the valuation of its mines under construction, which represent the underlying value of the group.
Whilst materiality for the financial statements as a whole was set at £231,000, each significant component of the group was audited
to an overall materiality ranging between £700 - £207,000 (2021: £43,600 - £174,600) with performance materiality set at 70% for
22 | P a g e
KAZERA GLOBAL PLC
the significant components and the group. The performance materiality for the group was set at £161,700 (2021: £135,800). The
benchmark of 70% has been selected as many of the balances representing risk areas, including the carrying value of mines under
construction and impairments of investments in subsidiaries, which we tested 100%. Therefore, we concluded this provided sufficient
coverage of significant and residual risks. We applied the concept of materiality both in planning and performing our audit, and in
evaluating the impact of misstatements.
We communicated in our audit planning report that all audit differences identified during the course of our audit in excess of £11,550
(2021: £9,700) will be brought to the attention of those charged with governance. There were no misstatements identified during
the course of our audit that were individually, or in aggregate, considered to be material.
Materiality for the parent company financial statements was set at £207,000 (2021: £174,600), based on a percentage of gross assets,
with performance materiality set at 70%. The performance materiality for the parent company was set at £144,000 (2021: £122,220).
Materiality has been reassessed during the fieldwork and closing stages of the audit, taking into consideration new information which
arose. No alterations were made to materiality either during or at the conclusion of the audit.
Our approach to the audit
In designing our audit approach, we determined materiality and assessed the risk of material misstatement in the financial
statements. In particular, we assessed the areas requiring the directors to make subjective judgements, for example in respect of
significant accounting estimates including the carrying value of mines under construction and impairment of investments in
subsidiaries and the consideration of future events that are inherently uncertain.
An audit was performed on the financial information of the group’s material operating components which, for the year ended 30
June 2022, were located in South Africa and in Namibia. There are two dormant companies within the group which were not assessed
as material components. Consequently, the audit work performed on these components consisted of analytical procedures at group
level.
The work performed by component auditors, under our instructions on the significant components located in Namibia was directed
by us as group auditor and the Senior Statutory Auditor was responsible for the scope and direction of the audit process. We ensured
that there was regular interaction with the component auditors during all stages of the audit and reviewed their working papers to
gain sufficient appropriate evidence for our opinion on the group financial statements.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
Carrying Value of Mines Under Construction (Note 12)
There is a risk that the carrying value of the mines under
construction might be impaired and the assumptions used to
estimate impairment values are not appropriate.
The recoverability of these balances is ultimately dependent
on the mines being able to generate returns. The mines are
not yet in the production phase and the recoverability and
valuation of these amounts is dependent on management
judgement and estimation.
The value of the mines under construction amounts to
£2,961k (2021: £2,896k), representing the most material
amount within the financial statements.
Given the quantum of the account balance and the significant
level of management judgement and estimation involved, the
carrying value of mines under construction is considered to be
a key audit matter.
How our scope addressed this matter
Our work in this area included but was not limited to:
▪
A review of the costs capitalised, and additions made
to mine under construction assets during the fiscal
year to ensure that transactions are accounted for in
accordance with IFRS;
▪ Obtaining Management’s impairment assessments
▪
▪
▪
and challenging the inputs used therein;
Assessing whether sufficient funding is available to
bring the mines into production and thereby generate
revenue;
Performing sensitivity analysis on the impairment
calculations;
Consideration of the buy in price for the disposal of
the Namibian operations and whether there was a
shortfall or surplus on the carrying amounts vs the
disposal amount at the date of disposal;
▪ Obtaining and reviewing reports produced by
management’s experts in support of the underlying
mineral resources;
Assessing the independence and competence of
management’s expert;
▪
23 | P a g e
Key Audit Matter
How our scope addressed this matter
KAZERA GLOBAL PLC
Impairment of Investments in Subsidiaries (Parent Company
Only) (Note 14)
There is a risk that the carrying value of investments held in
subsidiaries at a Parent Company level may be impaired.
The recoverability of these balances is dependent on the
subsidiaries being able to generate returns from its underlying
mines under construction and the valuation of recoverability
of these balances is subject to significant management
estimation and judgement.
For the year ended 30 June 2022, the value of investments in
subsidiaries amounts to £3,298k (2021 : £3,114k).
The loan receivables from the subsidiaries were considerably
higher than the values of the investments at £7,989k (2021 :
£7,644k).
level of
Given the quantum of the balance and the
management estimation
impairment of
investments in subsidiaries is considered to be a key audit
matter.
involved, the
▪
▪
▪
A review of the component auditors working papers
through assessing the substantive testing performed
on additions made during the year and tracing an
appropriate sample to supporting documents to
ensure that capitalisations are properly accounted for
under the relevant IFRSs;
Ensuring valid relevant
licenses are held and
considering potential impairment if any license have
expired; and
Ensuring where
relevant
applicable
subcontracting agreements were in place to enable
mining operations.
valid
Our work in this area included but was not limited to:
▪ Obtaining Management’s impairment assessments
▪
▪
▪
and challenging the inputs used therein;
Assessing whether sufficient funding is available to
bring the mines into production and thereby generate
revenue;
Performing sensitivity analysis on the impairment
calculations;
Consideration of the buy in price for the disposal of
the Namibian operations and whether there was a
shortfall or surplus on the carrying amounts vs the
disposal amount at the date of disposal;
▪
▪
▪ Obtaining and reviewing reports produced by
management’s experts in support of the underlying
mineral resources;
Assessing the independence and competence of
management’s expert;
Ensuring valid relevant licenses are held and consider
potential impairment if any license have expired; and
Ensuring where
relevant
applicable
subcontracting agreements were in place to enable
mining operations and ownership of the investments
held.
valid
▪
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s
report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the group
and parent company financial statements does not cover the other information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or
apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
•
the information given in the strategic report and the directors’ report for the financial year for which the financial
statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the 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.
24 | P a g e
KAZERA GLOBAL PLC
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 statement of directors’ responsibilities, 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 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including fraud is detailed below:
▪ We obtained an understanding of the group and parent company and the sector in which they operate to identify laws and
regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our
understanding in this regard through, discussions with management, industry research, application of cumulative audit
knowledge and experience of the sector etc. This is evidenced by discussion of laws and regulations with the management,
reviewing minutes of meetings of those charged with governance and RNSs and review of legal or professional
expenditures. As for the parent company’s subsidiaries, corresponding instructions have been issued to the component
auditors to assess the compliance of the components to the applicable laws and regulations.
▪ We determined the principal laws and regulations relevant to the group and parent company in this regard to be those
arising from Companies Act 2006, AIM rules, and local laws and regulations in South Africa and Namibia relating to
exploration and production.
▪ We designed our audit procedures to ensure the audit team considered whether there were any indications of non-
compliance by the group and parent company with those laws and regulations. These procedures included, but were not
limited to:
o Discussion with management regarding potential non-compliance;
o
o
Review of the component auditor’s work on compliance with laws and regulations;
Review of legal and professional fees to understand the nature of the costs and the existence of any non-
compliance with laws and regulations;
Review of minutes of meetings of those charged with governance and RNS announcements.
o
▪
▪ We also identified the risks of material misstatement of the financial statements due to fraud. Aside from the non-
rebuttable presumption of a risk of fraud arising from management override of controls, and the presumed risk of fraud on
revenue recognition, we did not identify any significant fraud risks.
As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit
procedures which included, but were not limited to: the testing of journals; reviewing accounting estimates, judgements
and assumptions for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual
or outside the normal course of business and review of the bank statements during the year to identify any large and
unusual transactions where the business rationale is not clear.
25 | P a g e
KAZERA GLOBAL PLC
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a
material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance
with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to
become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than
error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone, other than the company and the company's members as a body, for our audit work, for this report, or for
the opinions we have formed.
Joseph Archer (Senior Statutory Auditor)
For and on behalf of PKF Littlejohn LLP
Statutory Auditor
Date: 15 March 2023
15 Westferry Circus
Canary Wharf
London E14 4HD
26 | P a g e
GROUP STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2022
Continuing operations
Revenue
Cost of Sales
Gross Profit / (loss)
Pre-production expenses
Administrative expenses
Operating loss
Finance charges
Loss before taxation
Taxation
Loss for the year
Loss attributable to owners of the Company
Loss attributable to non-controlling interests
Other comprehensive income:
Items that may be subsequently reclassified to profit and loss:
Exchange differences on translation of foreign operations
Total comprehensive loss for the year attributable to:
The equity holders of the parent
The non-controlling interests
Earnings per share attributable to owners of the Company
From continuing operations:
Basic and diluted (pence)
KAZERA GLOBAL PLC
Notes
Year ended
30 June 2022
£’000
Year ended
30 June 2021
£’000
5
6
7
10
107
(107)
-
(333)
(1,644)
(1,977)
(44)
(2,021)
-
(2,021)
(2,001)
(20)
(2,021)
55
(55)
-
(111)
(1,053)
(1,164)
(1,164)
-
(1,164)
(1,146)
(18)
(1,164)
(17)
107
(2,018)
(20)
(2,038)
(1,039)
(18)
(1,057)
11
(0.26) p
(0.17) p
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent Company
profit and loss account. The loss for the Parent Company for the year was £328,095 (2021: £423,521 loss).
The accounting policies and notes are an integral part of these financial statements.
27 | P a g e
GROUP AND COMPANY STATEMENTS OF FINANCIAL POSITION
As at 30 June 2022
KAZERA GLOBAL PLC
2021
£’000
2,897
716
-
-
3,613
168
47
215
209
209
431
55
486
COMPANY
2022
£’000
-
-
3,298
8,737
2021
£’000
-
-
3,114
7,644
12,035
10,758
22
609
631
645
645
-
-
-
23
3
26
180
180
301
-
301
6
(14)
(150)
GROUP
2022
£’000
2,961
796
-
-
3,757
279
637
916
652
652
826
54
880
264
3,141
3,133
12,021
10,303
3,516
17,556
2,077
443
(494)
(19,908)
3,190
(49)
3,141
3,279
15,863
2,077
337
(477)
(17,917)
3,162
(29)
3,516
17,556
2,077
443
-
(11,571)
3,279
15,863
2,077
337
-
(11,253)
12,021
10,303
-
-
3,133
12,021
10,303
Notes
12
13
14
16
17
18
19
19
20
21
21
Non-Current assets
Mines under construction
Property, plant and equipment
Investment in subsidiaries
Long-term loan
Current assets
Trade and other receivables
Cash and cash equivalents
Current liabilities
Trade and other payables
Non-Current liabilities
Other payables
Provisions
Net current assets / (liabilities)
Net assets
Equity
Share capital
Share premium account
Capital redemption reserve
Share option reserve
Currency translation reserve
Retained earnings
Equity attributable to owners of the
Company
Non-controlling interests
Total equity
These financial statements were approved by the Board of Directors on 15 March 2023.
Signed on behalf of the Board by
Dennis Edmonds
Director
Company number: 05697574
The accounting policies and notes form an integral part of these financial statements.
28 | P a g e
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Share capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Balance at 30 June 2020
3,255
15,711
2,077
Share
option
reserve
£’000
165
KAZERA GLOBAL PLC
Currency
translation
reserve
£’000
Retained
earnings
£’000
Equity
shareholders’
funds
£’000
Non-
controlling
interests
£’000
(584)
(16,771)
3,853
Total
£’000
3,842
(1,164)
(11)
(18)
Loss for the year
-
-
-
-
-
(1,146)
(1,146)
Other comprehensive income
-
-
-
-
107
- 107
- 107
Total comprehensive income
-
-
-
-
107
(1,146)
(1,039)
(18)
(1,057)
Non-controlling interest on
acquisition of a subsidiary
Transactions with Non-controlling
interest
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Issue of share capital
24
152
-
-
-
- 176
- 176
Share based payment expense
-
-
- 172
-
- 172
- 172
Balance at 30 June 2021
3,279
15,863
2,077
337
(477)
(17,917)
3,162
Loss for the year
-
-
-
Other comprehensive income
Total comprehensive income
Issue of share capital
Share options/warrants exercised
-
-
237
-
Share based payment expense
-
-
-
1,693
-
-
-
-
-
-
-
-
-
-
(10)
-
(17)
(17)
-
-
- 116
-
(2,001)
(2,001)
-
(17)
(2,001)
(2,018)
-
10
-
1,930
-
116
(29)
(20)
-
(20)
-
-
-
3,133
(2,021)
(17)
(2,038)
1,930
-
116
Balance at 30 June 2022
3,516
17,556
2,077
443
(494)
(19,908)
3,190
(49)
3,141
The accounting policies and notes form an integral part of these financial statements.
29 | P a g e
KAZERA GLOBAL PLC
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Share
capital
£’000
Share
premium
£’000
Capital
redemption
reserve
£’000
Share
option
reserve
£’000
Retained
earnings
£’000
Balance at 30 June 2020
3,255
15,711
2,077
165
(10,829)
Total
£’000
10,379
Total comprehensive income for
the year
Issue of share capital, net of
share issue costs
Share based payment expense
-
24
-
-
152
-
-
-
-
-
-
(424)
(424)
-
176
172
- 172
Balance at 30 June 2021
3,279
15,863
2,077
337
(11,253)
10,303
Total comprehensive income for
the year
Issue of share capital, net of
share issue costs
Share options/warrants exercised
Share based payment expense
-
-
237
1,693
-
-
-
-
-
-
-
-
-
-
(10)
116
(328)
(328)
-
10
-
1,930
-
116
Balance at 30 June 2022
3,516
17,556
2,077
443
(11,571)
12,021
The accounting policies and notes form an integral part of these financial statements.
30 | P a g e
GROUP AND COMPANY STATEMENTS OF CASH FLOWS
For the year ended 30 June 2022
KAZERA GLOBAL PLC
GROUP
COMPANY
Year ended
30 June
2022
£’000
Year ended
30 June
2021
£’000
Year ended
30 June
2022
£’000
Year ended
30 June
2021
£’000
OPERATING ACTIVITIES
Operating loss
Depreciation and amortisation
Share based payment expense
Finance charges
Foreign exchange
Provisions for mine rehabilitation and
decommissioning
Intercompany loan interest charged
Operating cash flows before movement in
working capital
(Increase)/decrease in receivables
Increase in payables
Net cash used in operating activities
INVESTING ACTIVITIES
Purchases of property, plant and equipment
Development costs
Trial diamond mining
Advances to subsidiary undertakings
Purchase/increase in subsidiary undertakings
Net cash used in investing activities
FINANCING ACTIVITIES
Net proceeds from share issues
Loans received
Net cash from financing activities
Net increase/(decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
(2,021)
(1,164)
52
116
44
121
-
-
(1,688)
(110)
880
(918)
(438)
(6)
107
-
-
(337)
1,498
347
1,845
590
47
637
126
172
-
(39)
55
-
(850)
21
382
(447)
(197)
-
-
-
-
(197)
176
90
266
(378)
425
47
The accounting policies and notes are an integral part of these financial statements.
(328)
-
116
44
-
-
(336)
(504)
1
205
(298)
-
-
-
(757)
(184)
(424)
-
172
-
-
-
(312)
(564)
89
312
(163)
-
-
-
(501)
-
(941)
(501)
1,498
347
1,845
606
3
609
176
90
(266)
(398)
401
3
31 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS
For the year ended 30 June 2022
1
GENERAL INFORMATION
Kazera Global Plc is a public limited company which is listed on the Alternative Investment Market (AIM) and incorporated and
domiciled in England and Wales, United Kingdom. The nature of the Group’s operations and its principal activities are set out
in the Strategic Report and the Directors’ Report.
2
ACCOUNTING POLICIES
BASIS OF PREPARATION
These consolidated financial statements have been prepared and approved by the Directors in accordance with UK Adopted
International Accounting Standards in accordance with the requirements of the Companies Act 2006.
The consolidated financial statements have been prepared under the historical cost convention, except as noted in the
accompanying accounting policies.
The preparation of financial statements in conformity with UK Adopted International Accounting Standards (‘IAS’) requires the
use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying
the accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the financial statements, are disclosed in Note 3.
The financial statements are presented in pounds sterling (£’000), which is also the functional currency of the Company and
Group.
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
GOING CONCERN
The Company prepares and routinely maintains a cash flow forecast; the directors have, with reference to the cash flow
forecast considered a number of potential scenarios under which the Company’s ability to continue as a going concern.
During October 2021, the Company secured a loan facility of £450,000 with Westleigh Investments Holdings Limited, and
throughout the year, received equity finance from the exercise of share options, warrants, and the conversion of contractor
liabilities, salaries and loans, totalling £887,065.
The loan from Westleigh Investments Holdings Limited was subsequently repaid in full during January 2023 following the sale
of the Company’s Namibian business for US$13 million, which was as announced in December 2022.
The Group’s South African diamond business investment is now also generating revenue.
The Directors are of the opinion that existing available cash resources together with deferred cash consideration from the
disposal of the Namibian business and cash inflows from operations will be sufficient to meet operating cash outflows
requirements for a period of 12 months from the date of approval of these financial statements. Future revenues will be
dependent upon the Company’s ability to extract and sell diamonds in line with budgets. In the event that the mining activities
do not perform in line with budgets, the Directors are confident that the deferred consideration from the disposal of the
Namibian business with be sufficient to meet any shortfall.
Taking the above factors into consideration, the financial statements have been prepared on the going concern basis.
32 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
KAZERA GLOBAL PLC
NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS ADOPTED BY THE GROUP
The following IFRS or IFRIC interpretations were effective for the first time for the financial year beginning 1 July 2020. Their
adoption has not had any material impact on the disclosures or on the amounts reported in these financial statements.
Standard /interpretations
Annual Improvements to IFRS Standards:
2018 – 2020 Cycle
Application
Effective 01 January 2022
Amendments to IAS1
Presentation of Financial Statements and IFRS
Practice Statement 2: Disclosure of
Accounting Policies
Amendments to IAS 8
Amendments to IAS 12
Amendments to IFRS 10 and IAS 28
Amendments to IFRS 3
Amendments to IAS 16
Amendments to IAS 1
Amendments to IAS 1
Disclosure of Accounting Policies (effective 1 January 2023);
Accounting policies, Changes in Accounting Estimates and Errors – Definition
of Accounting Estimates (effective 1 January 2023)
Income Taxes – Deferred Tax arising from a Single Transaction (effective 1
January 2023).
Sale or Contribution of Assets between an Investor and its Associate or Joint
Venture (effective date postponed) Business Combinations – Reference to the
Conceptual Framework (effective date 1 January 2022)
Amendments to IAS 1: Presentation of Financial Statements and IFRS Practice
Statement 2: Disclosure of Accounting Policies
Property, Plant and Equipment (effective date 1 January 2022)
Presentation of Financial Statements: Classification of Liabilities as Current or
Non-current (effective date TBC)
Classification of Liabilities as Current or Non current (effective date TBC)
NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS NOT YET ADOPTED BY THE GROUP
There are no IFRS’s or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the
Company or Group.
BASIS OF CONSOLIDATION
Subsidiaries are all entities (including structured entities) over which the Group has control. 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. Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are deconsolidated from the date that control ceases.
Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated.
Unrealised losses are also eliminated.
The Group applies the acquisition method to account for business combinations. The consideration transferred for the
acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the
subsidiary and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or
liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group
recognises any non-controlling interest in the subsidiary on an acquisition-by-acquisition basis, either at fair value or at the
non-controlling interest’s proportionate share of the recognised amounts of subsidiary’s identifiable net assets.
Acquisition-related costs are expensed as incurred.
Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised either in profit
or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not re-measured,
and its subsequent settlement is accounted for within equity.
FOREIGN CURRENCIES
The individual financial statements of each group company are presented in South African Rands and Namibian Dollars, which
is the currency of the primary economic environment in which it operates (its functional currency). For the purpose of the
33 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
KAZERA GLOBAL PLC
Group financial statements, the results and financial position of each group company are expressed in Pounds Sterling, which
is the functional currency of the Company, and the presentation currency for the Group financial statements.
In preparing the financial statement of the individual companies, transactions in currencies other than the entity’s functional
currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each year
end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on
the year end date. Non-monetary items carried at fair value that are denominated in foreign currencies are translated at the
rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical
cost in a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included
in the income statement. Exchange differences arising on the retranslation of non-monetary items carried at fair value are
included in profit or loss for the period, except for differences arising on the retranslation of non-monetary items in respect of
which gains and losses are recognised directly in equity. For such non-monetary items, any exchange component of that gain
or loss is also recognised directly in equity.
For the purpose of presenting Group financial statements, the assets and liabilities of the Group’s foreign operations are
translated at exchange rates prevailing on the year end date. Income and expense items are translated at the average
exchange rates for the period. Exchange differences arising are classified as equity and transferred to the Group’s translation
reserve. Such translation differences are recognised as income or as expenses in the period in which the operation is disposed
of.
TAXATION
The tax currently payable is based on taxable profit or loss for the period. Taxable profit or loss differs from net profit or loss
as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The Company’s liability for current tax is calculated
using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and
liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be
available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the
temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets
and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying value of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is
realised based on tax laws and rates that have been enacted at the balance sheet date. Deferred tax is charged or credited in
the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is
also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current
tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
INTANGIBLE ASSETS – EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation activity involve the search for mineral resources, the determination of technical feasibility and the
assessment of commercial viability of an identified resource. Research expenditure is written off in the year in which it is
incurred. The Group recognises expenditure as exploration and evaluation assets when it determines that the legal rights to
said assets have been obtained. Costs incurred which relate wholly to exploration work only, are expensed through the
statement of comprehensive income. When a decision is taken that a mining property becomes viable for commercial
production, all further pre-production expenditure is capitalised.
Expenditure included in the initial measurement of exploration and evaluation assets and which is classified as intangible
assets, relates to the acquisition of rights to undertake topographical, geological, geochemical and geophysical studies,
exploratory drilling, trenching, sampling and other activities to evaluate the technical feasibility and commercial viability of
extracting a mineral source.
34 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
KAZERA GLOBAL PLC
MINES UNDER CONSTRUCTION
Expenditure is transferred from “Exploration and evaluation” assets to “Mines under construction” once the work completed
to date supports the future development of the property and such development receives the requisite approvals. All
subsequent expenditure on technically and commercially feasible sites is capitalised within mining rights.
All expenditure on the construction, installation or completion of infrastructure facilities is capitalised as construction in
progress within “Mines under construction”. Once production starts, all assets included in “Mines under construction” are
transferred into “Property, Plant and Equipment” or “Producing Mines. It is at this point that depreciation/amortisation
commences over its useful economic life. The asset will be depreciated using the Units of Production method (UOP).
Mines under construction are stated at cost. The initial cost comprises transferred exploration and evaluation assets,
construction costs, infrastructure facilities, any costs directly attributable to bringing the asset into operation, the initial
estimate of the rehabilitation obligation, and, for qualifying assets, borrowing costs. Costs are capitalised and categorised
between mining rights and construction in progress respectively according to whether they are intangible or tangible in
nature.
PROPERTY, PLANT AND EQUIPMENT
Property, Plant and equipment are recorded at cost, less depreciation, less any amount of adjustments for impairment, if any.
Significant improvements are capitalised, provided they qualify for recognition as assets. The costs of maintenance, repairs
and minor improvements are expensed when incurred.
Tangible assets, retired or withdrawn from service, are removed from the balance sheet together with the related accumulated
depreciation. Any profit or loss resulting from such an operation is included in the income statement.
Tangible and intangible assets are depreciated on the straight-line method based on their estimated useful lives from the time
they are put into operation, so that their net cost is diminished over the lifetime of consideration to estimated residual value
as follows:
Buildings – Over 20 years
Plant and machinery– Between 5 and 10 years
Furniture and equipment – Between 5 and 10 years
IMPAIRMENT OF PROPERTY, PLANT & EQUIPMENT AND INTANGIBLE ASSETS EXCLUDING GOODWILL
Assets that have an indefinite useful life are not subject to amortisation but are reviewed for impairment annually and where
there are indications that the carrying value may not be recoverable. An impairment loss is recognised for the amount by which
the carrying value exceeds the recoverable amount.
ASSET ACQUISITIONS - LAND
Acquisitions of mineral exploration licences through the acquisition of non-operational corporate structures that do not
represent a business, and therefore do not meet the definition of a business combination, are accounted for as the acquisition
of an asset. The consideration for the asset is allocated to the assets based on their relative fair values at the date of
acquisition. Inter-company transactions, balances and unrealised gains on transactions between group companies are
eliminated. Unrealised losses are also eliminated.
Where the asset was acquired during the period however licensing becomes available post year end this is accounted for as
an acquisition of Land.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash at bank and in hand, deposits at call with banks, other short-term highly liquid
investments with original maturity at acquisition of three months or less that are readily convertible to cash, net of bank
overdrafts. For the purpose of the cash flow statement, cash and cash equivalents consist of the definition outlined above.
EQUITY INSTRUMENTS INCLUDING SHARE CAPITAL
Equity instruments consist of the Company’s ordinary share capital and are recorded at the proceeds received, net of direct
issue costs.
35 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
KAZERA GLOBAL PLC
FINANCIAL INSTRUMENTS – INITIAL RECOGNITION AND SUBSEQUENT MEASUREMENT
Classification
The Group classifies its financial assets into only one category, being those to be measured at amortised cost.
The classification depends on the Group’s business model for managing the financial assets and the contractual terms of the
cash flows.
Recognition
Purchases and sales of financial assets are recognised on trade date (that is, the date on which the Group commits to purchase
or sell the asset). Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired
or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.
Measurement
At initial recognition, the Group measures a financial asset at its fair value plus transaction costs that are directly attributable
to the acquisition of the financial asset.
Debt instruments
Amortised cost: Assets that are held for collection of contractual cash flows, where those cash flows represent solely payments
of principal and interest, are measured at amortised cost. Interest income from these financial assets is included in finance
income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss
and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as a
separate line item in the statement of profit or loss.
Impairment
The Group assesses, on a forward-looking basis, the expected credit losses associated with its debt instruments carried at
amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses
to be recognised from initial recognition of the receivables.
FINANCIAL LIABILITIES
All non-derivative financial liabilities are classified as other financial liabilities and are initially measured at fair value, net of
transaction costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest rate
method. Other financial liabilities consist of borrowings and trade and other payables.
Financial liabilities are classified as current liabilities unless the Company has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
OTHER FINANCIAL LIABILITIES, BANK AND SHORT-TERM BORROWINGS
Other financial liabilities, as categorised above, are initially measured at fair value, net of transaction costs. Other financial
liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised
on an effective yield basis. Other financial liabilities are classified as current liabilities unless the Company has an unconditional
right to defer settlement of the liability for at least 12 months after the balance sheet date.
TRIAL PRODUCTION REVENUE AND COSTS
Revenue
IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. These
steps are as follows: identification of the customer contract; identification of the contract performance obligations;
determination of the transaction price; allocation of the transaction price to the performance obligations; and revenue
recognition as performance obligations are satisfied.
Under IFRS 15, revenue is recognised when performance obligations are met. This is the point of delivery of goods to the
customer. Revenue is measured at the fair value of consideration received or receivable from sales of diamonds and tantalite
to an end user, net of buyer’s discount, treatment charges, freight costs and value added tax. The application of the standard
including the five-step approach has not resulted in any changes to the timing of recognition of revenue in the current or any
prior period. Accordingly, the information for 2021 has not been restated.
Revenues from the sale of diamonds as a by-product of the evaluation or “testing” phase are offset against the cost of the
Mines Under Construction (see Note 12).
36 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
EARNINGS PER SHARE
Basic earnings per share is calculated by dividing:
•
•
the profit attributable to owners of the Company, excluding any costs of servicing equity other than ordinary shares;
by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the year and excluding treasury shares (note 11).
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
•
•
the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares;
and
the weighted average number of additional ordinary shares that would have been outstanding, assuming the
conversion of all dilutive potential ordinary shares.
SEGMENTAL ANALYSIS
Under IFRS 8 operating segments are considered to be components of an entity about which separate financial information is
available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assessing
performance. The Company’s chief operating decision maker is the Board of Directors. At present, and for the period under
review, the Company’s reporting segments are the holding company, tantalite and lithium mining operation in Namibia and
the diamond mining operations in South Africa.
3
CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATIONS
In the application of the Group’s accounting policies, which are described in Note 2, the Directors are required 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.
Valuation of options
The valuation of the options involves making a number of critical estimates relating to price volatility, future dividend yields,
expected life of the options and forfeiture rates. These assumptions and valuation methodology adopted have been described
in more detail in Note 22. The estimates and assumptions could materially affect the Income Statement.
Carrying value of mines under construction (Note 12)
The Group tests annually whether its mines under construction have suffered any impairment and management make
judgements in this respect. The judgements are based on the recoverable amounts of cash generating units (“CGUs”) which
are determined based on value in use calculations which require the use estimates and assumptions such as long-term
commodity prices and recovery rates, discount rates, operating costs and therefore expected margins and future capital
requirements. These estimates and assumptions are subject to risk and uncertainty and therefore there is a possibility that
changes in circumstances will impact the recoverable amount.
In assessing the carrying amounts of its tantalite mine under construction, the Directors have conducted a feasibility study in
conjunction with an independently prepared mineral resource estimate. The period used in management’s assessment is the
anticipated life of the mine to the expiration of the licence. A discount rate of 10% has been applied. The mineral resource
report concluded on an inferred 297,600 tonnes of tantalum pentoxide within the White City Tantalum Mineral Resource Area.
These estimates are consistent with external sources of information. The three principal variables in the Company’s forecasts
are as follows: resources, pricing and operational efficiency. In reviewing sensitivities, the following should be considered: a
further 622,200 tonnes of lithium and tantalite resources have been identified at Purple Haze and Homestead in addition to
the resources at White City, the Company’s financial forecasts assume a 65% operational efficiency and resources are forecast
to be sold on long term contracts to end users reducing commodity risk.
In assessing the carrying amounts of its diamond operations, the Company has commissioned an independent feasibility study
which has concluded that the market value of its operations is significantly greater than carrying value.
37 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATIONS (continued)
Investment in subsidiaries
The investments in subsidiaries are recognised at cost less accumulated impairments. Details of the investments are listed in
Note 14.
Upon acquisition, the excess of the sum of the consideration transferred over the net of the acquisition-date amounts of the
identifiable assets acquired and the liabilities assumed, is recognised under mines under construction.
Any potential impairments to the investments in subsidiaries are measured in line with the impairment of mines under
construction in the paragraph above.
The Directors are confident that the future operational cashflows forecast to be generated from the sale of diamonds, tantalum
and HMS will be sufficient to repay the intergroup loans.
38 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
4
SEGMENTAL REPORTING
The Directors are of the opinion that under IFRS 8 – Operating Segments the Group operates in three primary business
segments; being holding company expenses, tantalite mining and diamond mining activities. The secondary segment is
geographic. Pre-production/ trial revenue earned during each of the years ended 30 June 2022 and 30 June 2021 were from
immaterial sales to Alexkor and JAE Mining.
The Group’s losses and net assets by primary business segments are shown below.
Segmentation by continuing business
Profit/ (loss) before income tax
Holding company
Tantalite mining activity
Diamond mining activity
Net assets /(liabilities)
Holding company
Tantalite mining activity
Diamond mining activity
Segmentation by geographical area
Loss before income tax
United Kingdom
Namibia
South Africa
Net assets /(liabilities)
United Kingdom
Namibia
South Africa
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
(664)
(1,170)
(187)
(2,021)
(424)
(506)
(234)
(1,164)
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
12,021
(6,722)
(504)
10,303
(5,280)
(300)
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
(664)
(1,170)
(187)
(2,021)
(424)
(506)
(234)
(1,164)
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
12,021
(6,722)
(504)
10,303
(5,280)
(300)
39 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
5
REVENUE
Revenue from external customers
KAZERA GLOBAL PLC
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
107
55
Revenues of £107k were derived from customers in South Africa, for the sale of the by-products of testing and evaluation
activities in Deep Blue Minerals Limited. The revenues were derived from pre-production activities and have been considered
against the Mines Under Construction intangible asset recognised in the Group (see note 12).
6
OPERATING LOSS
Loss for the period has been arrived at after charging:
Staff costs as per Note 9 below
Auditors’ remuneration
Depreciation of property, plant and equipment
Share-based payment expense
7
FINANCE CHARGES
Loan interest payable
8
AUDITORS’ REMUNERATION
The analysis of auditors’ remuneration is as follows:
Fees payable to the Group’s auditors for the audit of the Group’s annual accounts
Total audit fees
Fees payable to the Group auditor and their associates for other services to the Group:
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
520
50
52
116
577
40
126
172
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
44
44
-
-
Year ended
30 June 2022
£’000
Year ended
30 June 2021
£’000
50
50
-
50
40
40
-
40
40 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
9
STAFF COSTS
The average monthly number of employees (including executive directors) for the continuing operations was:
KAZERA GLOBAL PLC
Group total staff
Wages and salaries
Share based payment in respect of exercise of options
Other benefits
Social security costs
Year ended
30 June 2022
Number
16
Year ended
30 June 2021
Number
16
£’000
£’000
400
118
1
1
520
367
172
2
36
577
DIRECTORS’ EMOLUMENTS
An analysis of the directors’ emoluments and pension entitlements and their interest in the share capital of the Company is
contained in the Directors’ Remuneration report on page 20 accompanying these financial statements. All emoluments are
short term in nature and the Directors are considered to be key management personnel.
10
TAXATION
The weighted average applicable tax rate of 28.25% (2021: 28.25%) is a combination of the rates used in the UK, Namibia
and South Africa.
Analysis of income tax expense:
Current tax
Deferred tax
Total income tax expense
Loss on continuing operations before tax
Tax at the weighted average tax rate of 28.25% (2021 28.25%)
Effects of:
Expenses not deductible for tax purposes
Unutilised tax losses carried forward
Tax charge for period
Year ended
30 June 2022
£'000
Year ended
30 June 2021
£'000
-
-
-
-
-
-
(2,021)
(571)
(1,164)
(329)
33
538
-
1
328
-
The taxation charge in future periods will be affected by any changes to the corporation tax rates in force in the countries in
which the Group operates. Losses from the previous period have been carried forward. A deferred tax asset has not been
recognised in the financial statements due to the uncertainty of the recoverability of the amount.
At the balance sheet date the Group had unused tax losses of £7,401,000 (2021: £5,497,000)
41 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
11
EARNINGS PER SHARE
The calculation of basic earnings per share is based on the following data:
Loss for the year attributable to owners of the Company
KAZERA GLOBAL PLC
Year ended
30 June 2022
Year ended
30 June 2021
£’000
(2,021)
£’000
(1,164)
Weighted average number of ordinary shares in issue for basic and fully diluted
earnings
EARNINGS PER SHARE (PENCE PER SHARE)
BASIC AND FULLY DILUTED:
- from continuing and total operations
(0.17)
The Company has outstanding warrants and options as disclosed under Note 22 which may be dilutive in future periods. The
effect in respect of the current year would have been anti-dilutive (reducing the loss per share) and accordingly is not
presented.
770,895,360
(0.26)
686,324,120
In addition, the effect of the issue of ordinary shares shortly after year end, would also have been anti-dilutive, and
accordingly is not considered. The issue however, may be dilutive in future periods.
12 MINES UNDER CONSTRUCTION
GROUP
At 1 July 2020
Additions
Sale of by-products
Exchange translation difference
At 30 June 2021
Additions
Trial production revenue
Exchange translation difference
Construction in
progress
£’000
2,784
-
(55)
132
2,861
-
(107)
161
Mining
licences
£’000
33
-
-
3
36
6
-
4
Total
£’000
2,817
-
(55)
135
2,897
6
(107)
165
At 30 June 2022
2,961
Revenues from the sale of the by-product of testing and evaluation activities have been offset against the costs of the
intangible asset. These totalled £107,281 in the year (2021: £54,952).
2,915
46
42 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
13 PROPERTY, PLANT AND EQUIPMENT
KAZERA GLOBAL PLC
GROUP
Cost
At 1 July 2020
Exchange translation difference
Additions
Cost at 30 June 2021
Exchange translation difference
Additions
Cost at 30 June 2022
Depreciation
At 1 July 2020
Exchange translation difference
Charge for the year
Depreciation at 30 June 2021
Exchange translation difference
Charge for the year
Depreciation at 30 June 2022
Net book value at 30 June 2022
Net book value at 30 June 2021
Land &
buildings
£’000
Plant &
machinery
Furniture &
equipment
£’000
£’000
125
-
-
125
-
184
309
30
-
5
35
-
5
40
269
90
964
24
197
1,185
(342)
196
1,039
432
16
116
564
(24)
44
584
455
621
36
3
-
39
(8)
58
89
28
1
5
34
(20)
3
17
73
5
14
INVESTMENT IN SUBSIDIARY UNDERTAKINGS
The Company’s investments in its subsidiary and associated undertakings
COMPANY
Cost and net book value
As at 1 July 2020
As at 30 June 2021
Acquisition: 60% of Whale Head Minerals (Pty) Ltd (Note 15)
As at 30 June 2022
All principal subsidiaries of the Group are consolidated into the financial statements.
Total
£’000
1,125
27
197
1,349
(350)
438
1,437
490
17
126
633
(44)
52
641
796
716
Total
£’000
3,114
3,114
184
3,298
At 30 June 2022 the subsidiaries were as follows:
Subsidiary undertakings
African Tantalum (Pty) Ltd
Namibia Tantalite Investments (Pty) Ltd
Tameka Shelf Company Four (Pty) Ltd
Whale Head Minerals (Pty) Ltd
Deep Blue Minerals (Pty) Ltd
Kazera Trading Limited
Country of
registration
Namibia
Namibia
Namibia
Principal activity
Intermediate holding company
Tantalite mining
Mining licence holder
South Africa Mining License holder
South Africa Mining License holder
UK
Dormant
Holding
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
%
100%
100%
100%
60%
90%
100%
43 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
14
INVESTMENT IN SUBSIDIARY UNDERTAKINGS (continued)
Whale Head Minerals (Pty) Ltd
On 30 September 2021, the Company announced an investment acquiring a 60% stake in Whale Head Minerals (Pty) Limited,
a South Africa-based company as the mining license holder. The cost of the transaction was an initial investment and directly
attributable acquisitions costs, totalling £183,079. Goodwill in the amount of £183,655 was recognised in relation to this
acquisition and subsequently impaired to £nil as at 30 June 2022.
15
BUSINESS ACQUISITION – WHALE HEAD MINERALS (PTY) LTD
On 28 September 2021, the Company acquired 60% of the issued share capital of Whale Head Minerals (Pty) Ltd (“WHM”)
for consideration of £184,000. The consolidated income statement for the year ended 30 June 2022 includes the results of
WHM from 28 September 2021, the date of the acquisition. The Company has determined the fair value of the assets and
liabilities of WHM to be recognised in these consolidated financial statements as follows:
Assets
Exploration and evaluation assets
Total Assets
Liabilities
Non-current liabilities
Total Liabilities
Total identified assets at fair value
Fair Value
recognised on
acquisition
£’000
10
10
(10)
(10)
-
Purchase consideration
184
Under IFRS 3, a business must have three elements: inputs, processes and outputs. Whale Head Minerals (Pty) Ltd is an early
stage exploration company and as at 30 June 2022, had no near term plans to develop a mine. WHM possess titles to mineral
properties but at 30 June 2022, these could not be considered inputs because of their early stage of development. WHM did
not have a skilled workforce, nor did it hold any infrastructure or assets that could produce outputs. Therefore, the Directors’
conclusion is that the transaction is an asset acquisition and not a business combination. As the mining licence only became
available after 30 June 2022, the acquisition of WHM was initially accounted for as an acquisition of land.
16
LONG-TERM LOAN (COMPANY)
COMPANY
As at 1 July 2020
As at 30 June 2021
Increase in loan
As at 30 June 2022
Loan to Aftan
Tantalum
£’000
6,729
7,145
840
7,985
Loan to Deep
Blue Minerals
£’000
102
499
234
733
Loan to Whale
Head Minerals
£’000
0
0
19
19
Total
£’000
6,831
7,644
1,394
8,737
The Directors are confident that the future operational cashflows forecast to be generated from the sale of diamonds, tantalum
and HMS will be sufficient to repay the intragroup loans.
17
TRADE AND OTHER RECEIVABLES
Other receivables
Prepayments and accrued income
GROUP
COMPANY
2022
£’000
262
17
279
2021
£’000
162
6
168
2022
£’000
5
17
22
2021
£’000
17
6
23
The Directors consider the carrying amount of intercompany loans and other receivables approximates to their fair value.
44 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
18
CASH AND CASH EQUIVALENTS
Cash and cash equivalents
GROUP
COMPANY
2022
£’000
637
2021
£’000
47
2022
£’000
609
2021
£’000
3
Cash and cash equivalents (which are presented as a single class of asset on the face of the balance sheet) comprise cash at
bank and other short term, highly liquid investments with a maturity of three months or less.
The Directors consider the carrying amount of cash and cash equivalents approximates to their fair value.
19
TRADE AND OTHER PAYABLES
Current Liabilities
Trade payables
Other payables
Accruals
Non-Current Liabilities
Other payables
Accruals
GROUP
COMPANY
2022
£’000
2021
£’000
2022
£’000
2021
£’000
12
482
158
652
826
-
826
128
7
74
209
220
211
431
12
480
153
645
-
-
-
108
3
69
180
90
211
301
The Directors consider the carrying amount of trade payables approximates to their fair value.
The ‘other payables’ current liability amount includes several loans: £148k from third parties; £199k from WIHL, a related
party (see note 26); loans relating to directors’ deferred salaries of £71k relating to Giles Clarke, and £57k relating to Nick
Harrison. The directors’ loans were repaid during December 2022.
The ‘other payables’ non-current liability amount includes loans of £766k from third parties.
20
PROVISIONS
Mine rehabilitation provision
Mine decommissioning provision
GROUP
2022
£’000
44
10
54
2021
£’000
45
10
55
COMPANY
2022
£’000
2021
£’000
-
-
-
-
-
-
The provisions for mine rehabilitation and decommissioning represents the management’s best estimate of the costs which
will be incurred in the future to meet the Group’s obligations under existing Namibian law and the terms of the Group’s
mining and other licences and contractual arrangements. Estimates are based upon costs that are regularly reviewed and
adjusted as new information becomes available. The current estimate was discounted at a rate of 7.50% and the liabilities
become payable in the next five years being licence validity period.
45 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
21.
SHARE CAPITAL AND SHARE PREMIUM
Total as at 1 July 2020
Share issues
Total as at 30 June 2021
Share issues
Total as at 30 June 2022
No. Ordinary shares
of 0.1p each
675,927,855
23,839,780
699,767,653
237,397,258
937,164,911
Deferred shares
of 0.9p each
286,561,208
-
286,561,208
-
286,561,208
Share Capital
£’000
3,255
24
3,279
237
3,516
Share Premium
£’000
14,307
1,404
15,863
1,693
17,556
Share issues
On 30 September 2021, 2,500,000 new ordinary shares were issued at 1 pence per share.
On 30 September 2021, 13,527,957 new ordinary shares were issued at 1.358 pence per share
On 1 October 2021, 5,000,000 new ordinary shares were issued at 1 pence per share
On 8 October 2021, 1,825,000 new ordinary shares were issued at 1 pence per share
On 15 October 2021, 1,666,667 now ordinary shares were issued at 0.6 pence per share
On 19 October 2021, 10,000,000 new ordinary shares were issued at 0.1 pence per share
On 27 October 2021, 3,500,000 new ordinary shares were issued at 0.5 pence per share
On 28 October 2021, 16,666,666 new ordinary shares were issued at 0.3 pence per share
On 29 October 2021, 3,500,000 new ordinary shares were issued at 1.0 pence per share
On 31 December 2021, 2,500,000 new ordinary shares were issued at a price of 1.0 pence per share
On 2 February 2022, 5,579,468 new ordinary shares at a price of 1.2546p per Ordinary Share
On 24 February 2022, 10,000,000 new ordinary shares were issued at a price of 1.0 pence per share
On 5 May 2022, 116,131,500 new ordinary shares were issued at a price of 1.0 pence per share
On 23 May 2022, 45,000,000 new ordinary shares were issued at a price of 0.3 pence per share
Reserves
The Group’s reserves are made up as follows:
Share capital: Represents the nominal value of the issued share capital.
Share premium account: Represents amounts received in excess of the nominal value on the issue of share capital less
any costs associated with the issue of shares.
Capital redemption reserve: Reserve created on the redemption of the Company’s shares
Share option reserve: Reserve created for the equity settled share option scheme (see note 22)
Currency translation reserve: Reserve arising from the translation of foreign subsidiaries at consolidation. The total
movement in the foreign currency translation reserve was presented in both the Statement of Changes in Equity and in
Other Comprehensive Income in the current year. During the prior year, this movement was presented in the Statement
of Changes in Equity.
Retained earnings: Represents accumulated comprehensive income for the year and prior periods.
46 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
22
SHARE-BASED PAYMENTS
Equity-settled share option scheme and share warrants
The Company operates share-based payment arrangements to incentivise directors by the grant of share options.
Equity-settled share-based payments within the scope of IFRS 2 are measured at fair value (excluding the effect of non-market
based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based
payments is expensed on a straight-line basis over the vesting period, based on the Company’s estimate of shares that will
eventually vest and adjusted for the effect of non-market based vesting conditions.
The fair value of the share-based payments has been calculated using the Black-Scholes valuation model. The assumptions
used in the fair value calculation were as follows:
Date of grant
Number of options/warrants
Exercise price (pence)
Risk free interest (%)
Expected volatility (%)
Expected life (years)
21 Dec 2018
10,000,000
1.75p
0.5%
50%
3.66
2 Oct 2019
3,333,333
0.6p
0.5%
50%
2.9
23 Mar 2020
66,666,667
0.3p
0.5%
50%
2
4 Jun 2020
26,500,000
1p
0.5%
50%
5
The total share-based payment expense recognised in the income statement for the year ended 30 June 2022 in respect of the
share options granted was £116,000 (2021: £172,000).
The total number of share options and share warrants in issue as at 30 June 2022 are as follows:
Exercise Price (p)
0.60
0.30
1.00
2.00
2.00
2.00
2.00
1.00
2.00
2.00
1.00
2.00
Expiry Date
23/09/2022
23/03/2022
17/06/2022
17/12/2022
27/12/2022
04/01/2023
12/01/2023
30/10/2023
01/02/2023
31/01/2023
31/05/2023
01/02/2023
Exercise Price (p)
1.75
1.75
1.75
1.00
1.00
1.00
1.00
1.00
2.00
1.00
Expiry Date
17/08/2021
17/08/2022
17/08/2023
03/06/2025
03/06/2025
03/06/2025
03/06/2025
03/06/2025
12/01/2023
06/05/2027
Share warrants
Issued
At 1 July 2021
-
1,666,667
-
61,666,666
-
64,700,000
-
325,000
10,000,000
-
2,500,000
-
5,000,000
-
39,722,643
-
2,500,000
-
10,000,000
-
- 116,131,500
3,500,000
-
128,033,333 189,354,143
At 1 July 2021
3,300,000
3,300,000
3,400,000
5,000,000
5,000,000
5,000,000
10,000,000
1,500,000
-
-
36,500,000
Share options
Issued
-
-
-
-
-
-
-
-
1,500,000
1,500,000
3,000,000
Exercised
1,666,667
61,666,666
33,500,000
325,000
-
-
-
-
-
-
-
-
97,158,333
Lapsed
-
-
-
-
-
-
-
-
-
-
-
-
-
Exercised
-
-
-
-
-
-
-
1,500,000
-
-
1,500,000
Lapsed
3,300,000
-
-
-
-
-
-
-
-
-
3,300,000
At 30 June 2022
-
-
-
-
10,000,000
2,500,000
5,000,000
171,854,143
2,500,000
10,000,000
116,131,500
3,500,000
189,354,143
At 30 June 2022
-
3,300,000
3,400,000
5,000,000
5,000,000
5,000,000
10,000,000
-
1,500,000
1,500,000
34,700,000
47 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
23
FINANCIAL INSTRUMENTS
The Group’s financial instruments comprise borrowings, cash and various items, such as trade receivables and trade payables
that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the Group's
operations.
FINANCIAL ASSETS BY CATEGORY
Financial assets included in the Statement of financial position and the headings in which they are included are as follows:
Financial assets at amortised cost:
Cash and cash equivalents
Loans and receivables
2022
£'000
637
279
916
2021
£'000
47
167
214
FINANCIAL LIABILITIES BY CATEGORY
Financial liabilities included in the Statement of financial position and the headings in which they are included are as follows:
2021
£'000
2022
£'000
Financial liabilities at amortised cost:
Trade and other payables
652
652
209
209
The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed
repayment periods. The table has been drawn up based on the undiscounted cash flows of financial liabilities based on the
earliest repayment date on which the Group can be required to pay. The table includes both interest and principal cash flows.
To the extent that interest flows are floating rate, the undiscounted amount is derived from the interest rate curves at the
balance sheet date. The contractual maturity is based on the earliest date on which the Group may be required to pay.
Less than
1 month
1-5 years Over 5 years
3 months
to 1 year
1-3 months
30 June 2021
Non-interest bearing:
Trade and other payables
Short term borrowings
30 June 2022
Non-interest bearing:
Trade and other payables
Short term borrowings
£’000
£’000
£’000
£’000
£’000
209
826
-
−
−
-
−
−
−
−
−
48 | P a g e
KAZERA GLOBAL PLC
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
24 RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group is exposed to a variety of financial risks which result from both its operating and investing activities. The Group’s
risk management is coordinated by the Board of Directors, and focuses on actively securing the Group’s short to medium term
cash flows by minimising the exposure to financial markets.
The main risks the Group are exposed to through its financial instruments and the operations of the Group are credit risk,
foreign currency risk, liquidity risk and market price risk. These risks are managed by the Group’s finance function together
with the Board of Directors.
Capital risk management
The Group’s objectives when managing capital are:
• to safeguard the Group’s ability to continue as a going concern, so that it continues to provide returns and benefits for
shareholders;
• to support the Group’s growth; and
• to provide capital for the purpose of strengthening the Group’s risk management capability.
The Group actively and regularly reviews and manages its capital structure to ensure an optimal capital structure and equity
holder returns, taking into consideration the future capital requirements of the Group and capital efficiency, prevailing and
projected profitability, projected operating cash flows, projected capital expenditures and projected strategic investment
opportunities. Management regards total equity as capital and reserves, for capital management purposes.
Credit risk
The Company’s principal financial assets are bank balances and cash and other receivables, which represent the Company’s
maximum exposure to credit risk in relation to financial assets. The credit risk on liquid funds is limited because the
counterparties are banks with high credit ratings assigned by international credit rating agencies.
As at 30 June 2022, the Group’s maximum exposure to credit risk was £636,854 (2021: £46,780) comprising cash and cash
equivalents.
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting its
obligations related to financial liabilities. The Group manages this risk through maintaining a positive cash balance and
controlling expenses and commitments. The Directors are confident that adequate resources exist to finance current
operations.
Foreign Currency risk
The Group undertakes transactions denominated in foreign currencies. Hence, exposures to exchange rate fluctuations arise.
Following the acquisition of African Tantalum (Pty) Ltd. Ltd, the Group’s major activity has been in Namibia, bringing exposure
to the exchange rate fluctuations of GBP/£ Sterling with the Namibian Dollar and South African Rand, the currencies in which
most of the operating costs are denominated. It is expected that the Group’s future exposure will principally be to GBP South
African Rand foreign exchange fluctuations following the Company’s disposal of African Tantalum (Pty) Ltd. At the year end the
value of assets denominated in these currencies was such that the resulting exposure to exchange rate fluctuations was not
material to the Group’s operations.
Exchange rate exposures are managed within approved policy parameters. The Group has not entered into forward exchange
contracts to mitigate the exposure to foreign currency risk.
The Directors consider the assets most susceptible to foreign currency movements to be the Investment in Subsidiaries.
Although these investments are denominated in South African Rands their value is dependent on the global market value of
the available Tantalite resources.
The table below details the split of the cash held as at 30 June 2022 between the various currencies. The impact due to
movements in the exchange rates is considered to be immaterial.
Namibian Dollar (NAD)
173,234
South African Rand (ZAR)
220,360
GBP Sterling (£)
608,504
Total GBP Sterling (£)
636,854
Market Price risk
Going forwards the Group’s exposure to market price risk mainly arises from potential movements in the market price of
Tantalite. The Group is managing this price risk by completing a fixed price off-take agreement in respect of the major part of
its planned production.
49 | P a g e
NOTES TO THE GROUP FINANCIAL STATEMENTS (continued)
For the year ended 30 June 2022
KAZERA GLOBAL PLC
25 EVENTS AFTER THE REPORTING PERIOD
On 20 July 2022, the Company announced that Kazera Global plc signed an agreement to secure an investment of US$7.5
million in return for a 49% stake in the Company's marketing, sales and export subsidiary ("SPV") for all lithium production
from the Company's wholly owned mine at Tantalite Valley, Namibia.
On 26 July 2022, the Company announced the transformational investment deal in lithium produced from the Company's
wholly owned mine at Tantalite Valley, Namibia, the Company has now received the first payment of US$100,000 in
accordance with the terms of the deal.
On 28 July 2022, the Company announced that Department of Mining and Mineral Resources has dismissed a third party's
appeal against the grant of a mining permit to the Company's 60% owned subsidiary Whale Head Minerals (Pty) Ltd
("WHM"). WHM now expects to shortly receive final documentation allowing it to commence production operations of heavy
mineral sands ("HMS") at the Walviskop mine in South Africa.
On 31 August 2022, the Company announced that that the mining permit has now been granted to the Company's 60% owned
subsidiary Whale Head Minerals (Pty) Ltd ("WHM"), which will facilitate the start of heavy mineral sands (" HMS ") production
at the Walviskop mine in South Africa.
On 20 September 2022, the Company granted options to subscribe for up to 16,500,000 new ordinary shares (representing
approximately 1.8% of the Company's issued ordinary share capital) to Dennis Edmonds, Chief Executive Officer of the
Company, and certain members of staff. Such options will be exercisable at any time up until 6 May 2027 at a price of 1p per
share.
On 20 December 2022, the Company announced the signing of a definitive agreement to sell its 100% interest in African
Tantalum (Proprietary) Limited ("Aftan") to Hebei Xinjian Construction ("Xinjian") for cash consideration of US$13,000,000.
26 RELATED PARTY TRANSACTIONS
The remuneration of the Directors, who are the key management personnel of the Company, is set out in the report of the
Board on remuneration accompanying these financial statements.
During the year, Westleigh Investment Holdings Ltd (“WIHL”) received £49,000 (2021: £48,000) in respect of accounting,
administration and office accommodation services provided to the Company. WIHL is a substantial shareholder in the Company
and is controlled by Giles Clarke and Nick Harrison.
In May 2022, Align Research Ltd converted £100,000 of its outstanding loan (as referred to on the Chief Executive’s Review on
page 3) together with the interest thereon into 11,131,500 ordinary shares.
In May 2022, Dennis Edmonds converted £50,000 of outstanding salary into 5,000,000 shares.
As at 30 June 2022, the Company had an outstanding loan of £199,000 with WIHL. This loan was repaid in January 2023.
As at 30 June 2022, £71,000 and £57,000 was owed to Giles Clarke and Nick Harrison respectively in unpaid salaries. These
amounts were settled in full in December 2022.
There have been no other material transactions with related parties.
27 ULTIMATE CONTROLLING PARTY
The Directors do not consider there to be one single ultimate controlling party.
50 | P a g e