KIBO ENERGY PLC
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR
THE YEAR ENDED 31 DECEMBER 2023
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEX
1
CORPORATE DIRECTORY
2
CHAIRMAN’S REPORT
4
CORPORATE GOVERNANCE REPORT
6
DIRECTORS’ REPORT
13
DIRECTORS’ STATEMENT OF RESPONSIBILITIES
26
AUDIT COMMITTEE REPORT
27
INDEPENDENT AUDITOR’S REPORT
29
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
36
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
37
COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
38
COMPANY STATEMENT OF FINANCIAL POSITION
39
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
40
COMPANY STATEMENT OF CHANGES IN EQUITY
41
CONSOLIDATED STATEMENT OF CASH FLOWS
42
COMPANY STATEMENT OF CASH FLOWS
43
SUMMARY OF MATERIAL ACCOUNTING POLICIES
44
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
57
ANNEXURE 1: HEADLINE EARNINGS PER SHARE
91
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE DIRECTORY
2
BOARD OF DIRECTORS:
Clive Roberts: Chairman (Non-Executive)
Jacobus van der Merwe: Interim Chief Executive Officer
Noel O’Keeffe: Non-Executive Director
COMPANY SECRETARY:
Noel O’Keeffe
REGISTERED OFFICE:
17 Pembroke Street Upper
Dublin 2, Ireland
BUSINESS ADDRESS - IRELAND:
Gray Office Park
Galway Retail Park
Headford Road
Galway, Ireland
AUDITORS:
Crowe Ireland
40 Mespil Rd
Dublin 4
D04 C2N4
Ireland
STOCK EXCHANGE LISTING:
London Stock Exchange: AIM - (Share code: KIBO) – Primary
Johannesburg Stock Exchange: JSE Alt X - (Share Code: KBO) – Secondary
SHARE REGISTRARS:
United Kingdom & Ireland
Link Registrars Ltd
Suite 149,
The Capel Building,
Mary’s Abbey,
Dublin 7, D07 DP79
South Africa
JSE Investor Services (Pty) Ltd
One Exchange Square,
2 Gwen Lane, Sandown,
Sandton, 2196
South Africa
PRINCIPAL BANKERS:
Allied Irish Banks PLC
Tuam Road
Galway
Ireland
JOINT BROKER:
Global Investment Strategy UK Limited
200 Aldersgate Street
London
EC1A4HD
England
JOINT BROKER:
Shard Capital Partners LLP
36-38 Cornhill
London
EC3V 3NG
England
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE DIRECTORY
3
SOLICITORS:
As to Irish Law:
OBH Partners
17 Pembroke Street Upper
Dublin 2
Ireland
As to English Law:
Druces LLP
Salisbury House
London Wall
London EC2M 5PS
UK NOMINATED ADVISER:
Beaumont Cornish Limited
Building 3
566 Chiswick High Road
London W4 5YA
JSE DESIGNATED ADVISER:
River Group
Unit 2, 211 Kloof Avenue
Waterkloof
Pretoria, South Africa
WEBSITE:
www.kibo.energy
CONTACT:
info@kibo.energy
DATE OF INCORPORATION:
17 January 2008
REGISTERED NUMBER:
451931
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CHAIRMAN’S REPORT
4
Chairman’s Statement
As the recently appointed non-executive Chairman, I am pleased to provide a review of Kibo Energy PLC (“Kibo” or
the “Company”) and its subsidiaries’ (together with Kibo, the “Group”) activities for the 2023 reporting period and to
present our full-year audited accounts for 2023.
The year proved a very challenging period for the Company in its endeavours to fund and develop its portfolio of
renewable energy projects spanning waste-to-energy, biofuel, and battery storage (the “African projects”) and reserve
energy in the UK. Consequently, progress with advancing these projects during 2023 was slow while the Company
focused on solutions to deal with its outstanding loan repayment obligations and to manage outstanding creditor
payments. At 31 December 2023, the Company’s total liabilities were £2,320,138 comprising £1,217,913 owed to
institutional investors and £1,102,225 to other creditors whilst total assets were £2,494,274. In recognition of the
risk profile of its assets, the Board of the Company following extensive consultation with the Company’s lenders,
advisors, potential investors and other stakeholders decided to implement an extensive restructuring and
repositioning plan (the Kibo Business Recovery Plan or “KBRP”) during the first half of 2024 which focused on
transitioning Kibo to a broader based energy company, looking at new business opportunities whilst deleveraging the
Company’s balance sheet.
The KBRP provided for the reconstitution of the Board with the appointment of new directors with the vision,
experience and access to projects and finance and to broaden the Company’s focus to new business opportunities
within the broader energy sector. Additionally, it provided for a part disposal and restructuring of the Company’s loan
debt and agreement for part conversion of trade creditor debt to equity. Despite some setbacks along the way these
tasks were significantly advanced with the support of a £350,000 placing subscription from a private investor (refer
Company RNS announcement of 27 June 2024).
Before I reflect on the Company’s activities during 2023, I take the opportunity to introduce the new members of the
reconstituted board comprising myself, appointed non-executive Chairman and Cobus van der Merwe our interim
CEO, both appointments to the board made in July 2024. Cobus, as the Company’s former Chief Financial Officer is
well placed to lead Kibo through its current transition phase while it seeks new project opportunities. I am also
pleased that Noel O’Keeffe is continuing in his current role as a non-executive director and company secretary over
this transitionary period to support the Company as it seeks new business opportunities. Louis Coetzee, the
Company’s former CEO is also making himself available to the Company in a board advisory role on a temporary basis
to assist with new project acquisitions.
During early 2023 the Company, notwithstanding its financial and operational challenges, continued to focus on
progressing its sustainable, renewable energy assets. These included its 2.7 MW plastic-to-syngas joint venture with
Industrial Green Energy Holdings (“IGEH Joint Venture”) in South Africa (Kibo held 65% of the project), where an
optimisation and integration study into the production of synthetic oil from non-recyclable plastic was initiated
during the reporting period. The Company also continued to liaise with TANESCO, the state electricity utility company
in Tanzania with the establishment of a Joint Technical Committee to supervise the production of a scope of work to
ensure key milestones are met with regard to the feasibility of establishing a biofuel fuelled thermal power plant in
southern Tanzania (the “Mbeya Power Project”), following the signing of a Memo of Understanding (“MoU”) in
November 2022. Regrettably, progress was severely hampered by the Company’s inability to secure funding for any
meaningful project development activities and subsequently all project activity came to a standstill towards the end
of the reporting period.
During 2024, the Company divested of most of its assets and became an AIM Rule 15 cash shell on 11 October 2024.
This followed the sale of its wholly owned Cyprus subsidiary, Kibo Mining (Cyprus) Limited, the holding company for
its African projects to Aria Capital Management Limited. The Company also disposed of its remaining 19.52% in LSE
listed UK Reserve Power operator and development company, Mast Energy Developments PLC.
As shareholders are aware, the Company remains suspended from trading on AIM from 1 July 2024 as it was unable
to prepare and publish its audited 2023 financial accounts (the “FY2023 Annual Accounts”) by this date due to the
financial challenges it was experiencing. I am pleased that the Company now expects the AIM trading suspension to
be lifted coincident with the publication of these FY2023 Annual Accounts and the HY24 Interim Results for the six
months ending 30 June 2024 to follow shortly.
On the corporate front, the Company, following extensive stakeholder engagement, implemented several measures to
ensure the Company's financial and operational stability including warrant re-pricing, convertible loan note conversions and
bridge loan reprofiling during 2023. While these measures offered some financial respite to the Company during 2023, it
became increasingly apparent that a more radical restructuring of the Board, debt profile and project focus would be required
to attract new investors. This resulted in the creation of the KBRP which provided a proposal for a restructuring and
repositioning plan for the Company, which has now been substantially implemented notwithstanding some outstanding
challenges in our efforts to complete a substantial corporate transaction that will bring new projects and new investment into
the Company. As the new non-executive Chairman of Kibo I am looking forward to guiding and working with the rest of
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CHAIRMAN’S REPORT
5
the board as we strive to fully execute the KBRP to re-launch the Company and take it forward by securing new projects and
new business opportunities in the broader energy sector.
In terms of International Financial Reporting Standards (IFRS), intangible assets with an indefinite life must be tested
for impairment on an annual basis and as a result the Group recognised impairment of £2,289,372, (2022: £7,038,930)
related to its assets. The result for the reporting period amounted to a loss of £5,715,341 for the year ended 31
December 2023 (31 December 2022: £10,908,524) as detailed further in the Statement of Profit or Loss and Other
Comprehensive Income, and further details on financial activities are detailed elsewhere in the Annual Report. The
loss is primarily due to the impairment of non-current assets, referred to above.
In closing, I would like to acknowledge the support of our shareholders and all other stakeholders as we embark on a
new journey with the Company. I would like to thank our Board, as well as management and staff, for their continued
support and commitment in advancing Kibo on the road ahead.
_____________________________
Clive Roberts
Chairman
20 December 2024
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE GOVERNANCE REPORT
6
The Kibo board (the “Board”) aims to conform to its statutory responsibilities and industry good practice in relation
to corporate governance of Kibo Energy PLC (“Kibo” or the “Company”) and its subsidiaries (together with Kibo, the
“Group”). The Board has adopted the latest version of the QCA Corporate Governance Code (2018) (“QCA Code”) and
endeavours to follow its ten principles (“the Principles”) with due regard to the stage of development of the Group.
In addition to my role as non-executive chairman of the Board, I am also the chairman of the Company’s Governance
Committee and retain primary responsibility for the design, implementation, articulation, review and updates of the
Company’s corporate governance policy. The Governance Committee meets at least once a year and makes
recommendations to the Board to ensure the Company’s corporate governance policy remains aligned with the
Principles as it grows.
The following are the principal ways in which the Group meets these requirements.
1. Establish a strategy and business model which promotes long-term value for shareholders
Following the adoption of the recent Kibo Business Recovery Plan and the re-organisation of the Board, The Company
is establishing a strategy and business model which it believes will promote long term value for shareholders. This
business model will span the Group’s financial, technical and operational areas and is continually updated as the
Group’s project portfolio expands. The Company believes this business model will deliver long term value to
shareholders by providing diverse exposure in the global energy sector. It further believes that this business model is
appropriate to protect the Company from unnecessary risk and secure its long-term future.
2. Seek to understand and meet shareholder needs and expectations
The Company seeks to understand and meet shareholder needs and expectations by engaging with them across a
range of platforms including regular investor presentations, Q&A forums, investor relations company services, social
media sites and at its Annual General Meeting where the Board encourages the active participation of shareholders
on important and relevant matters, including the Group’s strategy, financial performance, and operational and
commercial developments. The Company provides contact details on its RNS and SENS announcements where
shareholders can contact the appropriate senior Company representatives or advisors directly with their queries
together with a dedicated email address for shareholder feedback. The Board receives regular shareholder feedback
and provides prompt responses through all these communication channels and therefore believes it adequately meets
its shareholders expectations in this regard.
3. Consider wider stakeholder and social responsibilities and their implications for long-term success
The Company firmly believes that its projects that will form the basis of its business model will substantially benefit
the countries and regions in which it operates. It fosters a culture of open communication with all stakeholders who
may be impacted by its activities. Its strategy and business model are designed to minimise any negative impact of its
activities on the communities where it operates and on the environment.
The Company’s does not currently have any projects but is currently evaluating various project portfolios for
acquisition via corporate transaction which will most likely take the form of a reverse takeover of the Company.
Pending acquisition of new project(s) staff and locally appointed representatives at the Company’s project offices,
when established, will provide a first point of contact for stakeholders to receive information on the Company’s
activities and provide feedback on any issues or concerns they may have. The Company will appoint dedicated liaison
officers to communicate with stakeholder groups e.g., local & regional government officials, central government
departments, community groups and local suppliers to keep them continuously updated on project activities and
plans. Management will convey to the Board in a timely manner through formal reporting channels and at operational
review meetings any substantive concerns of stakeholders and where necessary, the Board will mandate appropriate
action be taken to address these concerns.
In support of the Company’s social responsibility towards the local communities among which it works, it will renew
and implement a Corporate Social Responsibility Plan (“CSR Plan”). As the company is currently reviewing the
composition and scope of new energy projects, it will update its CSR Plan in line with new projects acquired and
implement new initiatives specifically tailored to any new areas of operation.
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE GOVERNANCE REPORT
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4. Embed effective risk management, considering both opportunities and threats, throughout the
organisation
The Board has considered mechanisms by which the business and the financial risks facing the Group are managed
and reported to the Board. The principal business and financial risks have will be identified and control procedures
implemented. The Board acknowledges its responsibility for reviewing and updating the effectiveness of the systems
that are in place to manage risk in view of its new business strategy and to provide reasonable but not absolute
assurance on the safeguarding of the Group’s assets against misstatement or loss.
The major risks facing the Company are clearly identified in the Directors’ Report on page 13. The Company relies on
internal and external assessments of its systems for managing risk and it believes the continuous implementation of
recommendations from these reviews provide the Board with adequate assurance that its systems for managing risks
are effective.
The Company’s Audit Committee is the primary body that is tasked with identifying, assessing and managing risk. The
principal risks identified across all aspects of the Company’s operation include, inter alia, risks associated with foreign
exchange, strategy, funding, staffing, political stability and commercial activities. The Audit Committee regularly
reviews reports from Management across all financial and operational activities enabling it to identify and assess risks
and make recommendations to the Board where appropriate for mitigation. Similarly, it also informs the Board where
it identifies business opportunities that may be beneficial to the Company. The Audit Committee’s other core function
is to review and, if in order, recommend the annual financial statement to the Board for approval. Where the
Company’s auditors have identified risks or any shortcomings in accounting procedures, the Audit Committee brings
these to the Board’s attention for mitigation and/or rectification. The Audit Committee Report on page 25 provides
further details on the committee’s activities during 2023.
The Company maintains a Risk Register which is updated quarterly. This document is the cornerstone of its Risk
Management Policy and a key tool in monitoring the effectiveness of remedial action proposed by the Audit Committee
on an on-going basis.
5. Maintain the board as a well-functioning, balanced team led by the chair
The Board regularly meets to monitor and approve the strategy and business model for the Group.
The Board comprises a non-executive chairman, one executive director and one non-executive director. The non-
executive chairman and the other non-executive director are not considered by the Board to be independent directors
as a result their shareholdings in the Company. To address this, the Company intends to reconstitute the Board and
appoint independent non-executive directors commensurate with a corporate transaction to acquire new projects.
The Board considers non-executive directors to be independent when they are independent of Management and free
from any business or relationship that would materially interfere with the exercise of independent judgment as a
Board member.
The executive director comprises the Company’s interim CEO who dedicates 100% of his time to the Group. The non-
executive directors dedicate as much time as is required for them to fully carry out their duties for the Group including
overseeing corporate governance arrangements and serving on board committees. One of the non-executive directors,
Noel O’Keeffe, also serves as the Company secretary. The functions and composition of the various Board sub-
committees are outlined in Section 9 below.
The Board alone is responsible for:
•
formulating, reviewing and approving the Group’s budgets and major items of capital expenditure;
•
formulating the Group’s major policies and strategy;
•
monitoring and reviewing the Group’s performance and achievement of goals;
•
approval of Financial Statements and Annual Report;
•
major contracts and transactions;
•
board and management structure and appointments (the whole Board acts as the Nominations Committee);
•
effectiveness and integrity of internal control and management information systems; and
•
overall corporate governance of the Group.
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE GOVERNANCE REPORT
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An agenda and all supporting documentation are circulated to the directors before each Board meeting. Open and
timely access to all information is provided to directors to enable them to bring independent judgement on issues
affecting the Group and facilitate them in discharging their duties. The Board met twenty-five (25) times during the
last financial year to 31 December 2023 with on average >90% attendance by directors during this period.
In accordance with the Articles of Association of the Company, one third of the Board is required to retire each year
at the Company’s AGM but directors so resigning can put their name forward for re-election. The Board sets the
Group’s strategy and monitors its implementation through management and financial performance reviews. It also
works to ensure that adequate resources are available to implement strategy in a timely manner.
The Board is accountable to the shareholders for delivery of sustained value growth. In order to support its duties
and responsibilities the Board implements control procedures, such as quarterly operational review meetings, that
assess and manage risk and ensure robust financial and operational management within the Group.
6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
The Board considers that there is an appropriate balance between the executive and non-executive directors and that
no individual or small group dominates the Board’s decision making. The Board’s members have a wide range of
expertise and experience which the Board considers to be conducive to the effective leadership of the Group and to
the optimisation of shareholder value.
The Board members’ diverse range of skills and experience span technical, financial and operational areas relevant to
the management of the Company. Summary biographies of each Board member are shown on the Company’s website
and in the Directors’ Report on page 15. Directors keep their skill sets up to date by attendance at, and participation
in, various events organised by their respective industry sectors and/or by participation in continuing professional
development courses.
As the Company evolves, the Board composition will be reviewed to ensure appropriate expertise is always in place
to support its business activities. It strives to align directors’ responsibilities with their individual skills so they can
optimally contribute to its current strategy and business model. While the Board has not yet adopted any formal policy
on gender balance, ethnicity or age group, it is committed to fair and equal opportunity and fostering diversity subject
to ensuring appointees are appropriately qualified and experienced for their roles. The Company believes that its
current composition reflects this commitment.
The Company retains the services of independent advisors across financial, legal, technical/engineering and IT fields
that are always available to the Board. These advisors provide support and guidance to the Board and complement
the Company’s internal expertise.
7. Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
The performance of the Board and Management of the Company is evaluated on an on-going basis by the
Remuneration Committee (“Remcom”). The results of these evaluations are reflected in changes in the Executive
remuneration levels recommended by the Remcom from time to time and in awards under the Company’s Share
Option and Management Incentive Schemes where it considers such awards are warranted. Remuneration levels are
benchmarked against peer companies while performance awards are based on meeting pre-defined milestones such
as successful project acquisitions or completion of significant project development phases. As the Company grows,
the Board will develop more comprehensive human resource policies to provide both internal and external
performance evaluations of its Board, senior management and staff including the provision for upskilling where
necessary and to provide for Board member succession planning.
The Board considers that the corporate governance policies it has currently in place for Board performance reviews
is commensurate with the size and development stage of the Company.
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE GOVERNANCE REPORT
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8. Promote a corporate culture that is based on ethical values and behaviour
Historically the Company has operated across several countries including Ireland, UK, Cyprus, South Africa, Tanzania,
and Mozambique. In line with its international reach, the Company recognises the cultural diversity both internally
and among its business partners, service providers and other stakeholders. The Board promotes corporate values
that reflect its commitment to provide equal opportunity to all subject to its core principles that demand the adoption
of ethical values and conduct at all times. In this regard it has developed robust whistle-blower and anti-corruption
policies that Board, management, staff and service providers have signed up to. The Company’s Anti-Corruption policy
requires all Group personnel to declare conflicts of interest in any dealings on behalf of the Group and to excuse
themselves from any negotiation on behalf of, or with, the Company in such circumstances.
While the Company has not adopted a formal Code of Conduct at board level, management and staff behaviour is
governed by the terms of individual employment (and supplier) contracts whose terms reflect the ethics and values
of the Group. Together with other Company policies such as its whistle-blower and anti-corruption policies noted
above, these establish a high standard of values and behaviour to which all personnel working for, or on behalf, of the
Group are expected to adhere to. The Board monitors compliance with its ethical values through feedback from
Management and has disciplinary procedures in place to take corrective action where required.
9. Maintain governance structures and processes that are fit for purpose and support good decision-making
by the board
The Company has developed and adopted a variety of plans, policies, and procedures as part of its corporate
governance framework to ensure that the Company is run in an efficient, effective and responsible manner. Key
policies include:
Board Governance Plan
The Board Governance Plan is integrated into a Corporate Procedures Manual which sets out corporate governance
structure and includes the terms of reference for the various Board Committees. In addition, the Corporate Procedures
Manual outlines:
•
high level financial controls;
•
information system environment;
•
forecasting & budget procedures;
•
treasury operations;
•
accounting policies;
•
financial accounting procedures; and
•
management reporting framework.
Securities Trading/Share Dealing Policy
The Company’s Share Dealing Code sets out the Company’s policy, procedures and restrictions for directors,
management, staff and insiders in dealings in the Company’s shares. It is compliant with AIM and FCA Rules and with
the Company’s obligations under the Market Abuse Directive (2016).
Continuous Disclosure and Market Communications Policy
The Company’s policy is governed by the AIM Rules and the JSE Rules and all applicable national financial regulation
in the UK, Ireland and South Africa.
Risk Management Policy
The Company has developed a Risk Register which is reviewed on a quarterly basis. The Risk Register reviews the
risks around each aspect of management and operations and is scored by each Executive member of the Board in
terms of probability and impact to derive an overall risk profile for the Company. The Risk Register also records the
steps that are being taken to mitigate the major risks identified.
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Health and Safety Policy & Procedures
All operating companies within the Group have their own Health and Safety Policy and Procedures (“HSE Policy”)
tailored to the particular jurisdiction and environment in which they are active. The Board retains overall
responsibility to ensure appropriate HSE Policy is in place at all times and reviews this at its operations’ review
meetings.
Environmental Policy
Kibo is committed to high standards of environmental protection across our business. Our goal is to protect people,
minimise harm to the environment, integrate biodiversity considerations and reduce disruption to our neighbouring
communities. We seek to achieve continuous improvement in our environmental protection performance. The
Company will significantly expand and escalate our actions to meet our commitment to environmental protection
commensurate with the start of plant construction and energy production on our projects. The results of
environmental impact reports across our projects will be used to carefully plan for environmental risk assessments
and implement mitigating measures to protect the environment in association with relevant government bodies and
local communities.
Anti-corruption and bribery Policy
The Company’s Anti-corruption and bribery policy is in place to ensure that all directors, management, staff and
suppliers to the Group conduct themselves in an honest and ethical manner at all times. It meets the requirements of
the UK Bribery Act 2010.
Whistleblowing Policy
The Company’s Whistleblowing Policy is informed by Whistleblowing Arrangements Code of Practice issued by the
British Standards Institute and Public Concern at Work. Its objectives are:
•
to encourage Group personnel to report suspected wrongdoing as soon as possible, in the knowledge that
their concerns will be taken seriously and investigated as appropriate, and that their confidentiality will be
respected;
•
to provide Group personnel with guidance as to how to raise those concerns; and
•
to reassure Group personnel that they should be able to raise genuine concerns in good faith without fear of
reprisals, even if they turn out to be mistaken.
IT, communications and systems procedures
IT, communications and systems procedures are included in the Company’s Corporate Procedures Manual and are
designed to ensure a robust, upgradeable and secure IT system, with appropriate back-up to ensure any system failure
will not be catastrophic for the continued operations of the Company.
The Chairman is responsible for providing leadership to the Board while the day-to-day management of the Group is
led by the CEO. The CEO is primarily responsible for the Group’s business performance and manages the Group in
accordance with the strategies and business plan. The non-executive directors are responsible for providing advice
to the CEO and assisting with making Board decisions that are in the best interests of the Company.
The Board/senior officer committees are the Governance Committee, Executive Committee, Remuneration Committee
Audit Committee, and the Nomination Committee.
Governance Committee: Currently comprises two non-executive directors. The Committee meets at least once a year
to review the Company’s ongoing compliance with the QCA Code and to make recommendations to the Board where
it judges that there is a requirement to update, replace or expand corporate governance policies and procedures in
line with current activities. The Governance Committee is chaired by Clive Roberts and the other member is Noel
O’Keeffe.
Executive Committee: Currently just comprises one executive director but will be expanded commensurate with
new project acquisitions. When reconstituted, the Executive Committee meets at least once a month. The Executive
Committee is the core senior management team in the Company responsible for day-to-day management and
operations. Its terms of reference are defined in the Company’s Corporate Procedures Manual. The Executive
Committee’s function is currently carried out solely by Cobus van der Merwe (Interim CEO).
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Remuneration Committee: Comprises two non-executive directors. The Committee meets at least once a year to
determine Company policy on senior executive remuneration, to make detailed recommendations to the Board
regarding the remuneration packages of the executive directors and to consider awards under the Company’s Share
Option and Management Incentive Award schemes. The Chief Executive Officer is consulted on remuneration
packages and policy but does not attend discussions regarding his own package. The remuneration and terms and
conditions of the appointment of non-executive directors are determined by the Board. The Governance Committee
is chaired by Clive Roberts and the other member is Noel O’Keeffe.
Audit Committee: Comprises two non-executive directors. The Committee meets at least twice a year to consider the
scope of the annual audit and the interim financial statements and to assess the effectiveness of the Group’s system
of internal financial controls and risk management systems. It reviews the results of the external audit, its cost
effectiveness and the objectives of the auditor. Given the size of the Group, the Audit Committee considers that an
internal audit function is not currently justified. The Audit Committee is chaired by Noel O’Keeffe and the other
member is Clive Roberts.
Nomination Committee: Comprises the entire Board. The principal objectives of the Committee are to monitor and
review the Board structure, size, composition and the mix of skills and expertise to ensure that these are in line with
the Group’s strategies and to consider potential candidates for directorship.
The selection criteria for selection and recruitment of the potential candidates for directorship shall include
qualifications of the individual, experience, knowledge and achievements, credibility and background and ability of
the candidates to contribute effectively to the Board and Group. The Nomination Committee also oversees succession
planning of directors, taking into account the relative experience of each Board member in relation to the Company’s
requirements given its stage of development and strategies, with the goal of having in place an adequate and
sufficiently experienced board at all times.
The Company’s Corporate Procedures Manual includes a schedule of matters that are reserved as the sole
responsibility of the Board. These matters, in addition to setting strategy for the Company, include, but are not limited
to, Board nominations and appointments, approval of acquisitions and disposals and approval of annual budgets and
financings.
10. Communicate how the company is governed and is performing by maintaining a dialogue with
shareholders and other relevant stakeholders
The Board recognises the importance of establishing and maintaining good relationship with Kibo’s shareholders and
other stakeholders. The Board is responsible for ensuring satisfactory dialogue with shareholders throughout the
year. In order to establish and maintain good relationships with the shareholders of Kibo, and to maintain
transparency and accountability to its shareholders, Kibo uses various means to continuously communicate and
disseminate timely information to shareholders and stakeholders:
•
market announcements on regulatory platforms (RNS and SENS);
•
annual and interim reports;
•
circulars;
•
annual general meetings of shareholders;
•
investor presentations and briefings;
•
Q&A forums and social media sites;
•
website at www.kibo.energy.
The Company’s Audit Committee Report is presented on page 25 and provides further details on the committee’s
activities during 2023, and while a separate report from the Remuneration Committee was not produced due to the
size of the Company, the Company intends to review this requirement on an annual basis.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CORPORATE GOVERNANCE REPORT
12
Conclusion
The Company believes that its governance structures and practices as detailed above comply with the expectations of
the QCA Code in all material respects. It also acknowledges its obligations under the Code to continually monitor and
further develop the scope and suitability of its governance structures in line with its growth. The Company continued
to update its Plans, Policies and Procedures itemised at 9 above during 2023 to ensure it remains in compliance with
the QCA Code.
___________________________
Clive Roberts
Chairman
Governance Committee
20 December 2024
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
13
The Board of Directors present their Annual Report together with the audited annual financial statements for the year
ended 31 December 2023.
During 2023, the Board comprised two executive directors, Louis Coetzee, CEO and Acting Chairman, Chris Schutte,
Capital Project Director, and two non-executive directors, Ajay Saldanha and Noel O’Keeffe. Mr Schutte retired from
the board in May 2023 while Mr Saldanha retired from the board in January 2024. The Company has reconstituted
the Board in July 2024 with the retirement of Louis Coetzee and the appointment of two new directors, Clive Roberts
as non-executive chairman and Cobus van der Merwe as executive director and Interim CEO. Mr. O’Keeffe, who is also
the company secretary remains on the Board as a non-executive director.
The Board is responsible for the supervision and control of the Company and is accountable to the shareholders. The
Board has reserved decision-making on a variety of matters and is responsible for formulating, reviewing and
approving the Company's strategy, budgets, major items of capital expenditure and acquisitions, as well as reviewing
the performance of management.
An agenda and all supporting documentation are circulated to all directors before each Board meeting. Open and
timely access to all information is provided to all directors to enable them to bring independent judgement on issues
affecting the Company and facilitate them in discharging their duties.
Role of Directors
All Board members ensure that appropriate governance procedures are adhered to and there is a clear division of
responsibilities at Board level to ensure a balance of power and authority so that no one individual has unfettered
powers of decision making.
Board and Audit Committee meetings have been taking place periodically and the CEO manages the daily Company
operations with the Board meetings taking place on a regular basis throughout the financial period. During the current
reporting period the Board met twenty-five (25) times and provided pertinent information to the Executive
Committee of the Company.
Directors are entitled, in consultation with the Chairman, to seek independent professional advice about the affairs of
the Company, at the Company’s expense. The composition, roles and responsibilities of the board committees
established by the Company are set out in the Corporate Governance Report.
Board Composition
At the date of this report, the board of directors comprised:
Clive Roberts - Chairman (non-executive)
Jacobus van der Merwe – Interim Chief Executive Officer
Noel O’Keeffe – Director (non-executive)
Clive Roberts, BSc (Hons), Age 61– Chairman (non- executive)
Clive Charles Herbert Roberts (Aged 61) had a 30-year career in investment banking, including 22 years at ABN AMRO
Hoare Govett, and has spent the last 10 years investing in startups and AIM companies. He has helped raise many
millions of investment funds for multiple companies and his market experience will be extremely valuable to KIBO
going forward.
Cobus van der Merwe, BCom (Accounting), BCompt (Hons. Accounting Science), CA (SA), Age 43
Cobus is a qualified Chartered Accountant (South Africa) and has held senior financial, managerial and executive level
positions for over 15 years in the investment management and energy, utilities and resources sectors. He has
significant experience servicing clients based in the United Kingdom, Ireland and Africa with specific reference to the
Energy and Resources industries. Further to this, he has extensive experience in managing bespoke investment
portfolios for high net-worth individuals, including capital raising and facilitating deal making. Cobus is a member of
the South African Institute of Chartered Accountants (SAICA) and holds a BCom degree in Accounting and a BCompt
Honours degree in Accounting Science.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
14
Noel O’Keeffe, BSc (Hons), Geology, MBA, CG (Affiliated), Age 61 – Director (non-executive)
Noel O’Keeffe has over 30 years’ experience in mineral exploration and has worked on a variety of base metal and
gold projects in Ireland, Canada, Australia and Africa. Prior to co-founding Kibo in 2008 he worked as a quality
coordinator with Boston Scientific (Ireland) Ltd, a multinational medical device company. He also worked part-time
for Irish geological services group, Aurum Exploration Ltd during 2003 and early 2004. During the mid-nineties he
was exploration manager with Ormonde Mining PLC in Tanzania, a company currently listed on the Irish Stock
Exchange and on AIM. Previously Noel was a senior geological consultant with BDA Consultants Limited and worked
on both government and private sector contracts. Earlier in his career, Noel worked as a geologist for Burmin
Exploration and Development PLC and for its Canadian and Australian subsidiaries. In recent years, Noel has assumed
administration, company secretarial and regulatory oversight roles within the Kibo Group.
Review of Business Developments throughout the year to date
As the Company has recently divested of all its projects (October 2024) a detailed review of work carried out during
2023 is not presented. This divestment took place through the sale of the Company’s wholly owned Cyprus subsidiary,
Kibo Mining (Cyprus) Limited (KMCY), to Aria Capital Management Limited. KMCY held the Company’s African energy
projects which comprises the joint investment with South African group Industrial Green Energy Holdings (IGEH), to
convert un-recyclable plastic to syngas (using pyrolysis), its Long Duration Energy Storage (LDES) Strategic
Framework Agreement with Austrian company Enerox GmbH ('CellCube') and the complementary National
Broadband Solutions joint venture and its legacy coal projects in Tanzania and Mozambique.
Also in September 2024, the Company divested of its remaining 19.52% shareholding interest in Mast Energy
Developments PLC in partial settlement of an outstanding loan with RiverFort Global Opportunities PCC Limited
(“RiverFort”) at a deemed value of £120,074 and so reducing the outstanding balance on the loan to £342,797.
With reference to the qualified audit opinion on the Company’s investment in Shankley Biogas Limited, Kibo was
unable to provide the auditor with sufficient appropriate audit evidence about the carrying values of the investment
in Shankley and its associated assets and liabilities, as included in the Group and Company Balance Sheets as at 31
December 2022 and 31 December 2023. This is because of a dispute with the vendor due to the vendor’s inability to
provide sufficient and reliable financial information for Shankley Biogas Limited, despite numerous requests in this
regard, and the Company being unable to agree an option to lease agreement in respect of the site with the vendor.
The Company has been engaged in constructive negotiations to reach an amicable resolve for the ongoing dispute,
which may include cancelling the transaction, and is confident that this will be settled. Consequently, the investment
in Shankley Biogas Limited in the Company Balance Sheet of £600,000 and the Intangible Assets in the Group Balance
Sheet of £603,050, have been fully impaired and therefore the Company and Group Statements of Profit and Loss
include impairment losses of £600,000 and £603,050 respectively.
In terms of International Financial Reporting Standards (IFRS), intangible assets with an indefinite life must be tested
for impairment on an annual basis and as a result the Group recognised impairment of £2,289,372 (2022: £7,038,930)
related to its assets. The result for the reporting period amounted to a loss of £5,715,341 for the year ended 31
December 2023 (31 December 2022: £10,908,524) as detailed further in the Statement of Profit or Loss and Other
Comprehensive Income, and further details on financial activities are detailed elsewhere in the Annual Report. The
loss is primarily due to the impairment of non-current assets, referred to above.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
15
Events After the Reporting Period
Retirement of Directors
Ajay Saldanha and Louis Coetzee retired from the Board as directors of the Company on 10 January 2024 and 5 July
2024 respectively.
Conversion of accrued fees & interest to equity
On 11 January 2024 the Company announced the allotment of 500,000,000 new ordinary Kibo shares of €0.0001 each
to RiverFort representing conversion of accrued fees and interest totalling £161,000 forming part of the outstanding
balance of £1,106,146.72 reported by the Company owing to RiverFort under the Facility Restatement Agreement
signed on 11 April 2023. The conversion price was £0.000322 (0.0322 pence) calculated as 92% of the lowest daily
VWAP over the ten (10) Trading Days immediately preceding the date of the conversion notice in accordance with the
terms of the Facility Restatement Agreement.
Share issue to service provider in settlement of invoice
On 8 March 2024, a further 81,081,081 shares in settlement of an invoice to a separate service provider at a deemed
price of 0.037p for a total of £30,000 were issued.
Strategy Update
On 16 January 2024 the Company provided a strategy update on its bio-coal development test work as part of its
commitment to on-going sustainable clean energy solutions. It advised that it is currently formulating a joint
development agreement with a multinational food and beverage producer ("the Client") intended to be funded equally
(i.e., 50-50) by Kibo and the Client. The objective of this collaboration is to build and operate a pilot plant that will
produce bio-coal as a preliminary step towards the establishment of a comprehensive production-scale facility. This
initiative, subject to a successful pilot plant and financing, will enable the Client to transition from the use of fossil coal
to bio-coal in its comprehensive boiler fleet, without any reconfiguration, aligning with established Environmental,
Social and Governance (ESG) compliance standards. Furthermore, it noted that it has received conditional preliminary
approval for development funding, subject to due diligence, from a prominent development banking institution in
Southern Africa for one of the Company's existing waste-to-energy projects. It should be noted that Kibo no longer
has any interest in this project following the sale of Kibo Mining (Cyprus) Limited to Aria Capital Management Limited
in October 2024.
Extraordinary General Meetings
On 9 February 2024 the Company held an extraordinary general meeting where it obtained shareholder approval to
renew its ability to issue shares without applying pre-emption rights and to update its Memo & Articles of Association
to align with all authorities approved by Shareholders at previous general meetings.
On 25 July 2024 the Company held an extraordinary general meeting where it obtained shareholder approval to
increase its ordinary authorised share capital to 30 billion shares of €0.0001 each.
On 11 October 2024 the Company held an extraordinary general meeting where it obtained shareholder approval for
the sale of its wholly owned subsidiary, Kibo Mining (Cyprus) Limited to Aria Capital Management Limited.
Corporate Restructuring & Repositioning
On 7 June 2024, the Company announced a major corporate restructuring and repositioning of the Company that
included, inter alia, the conditional appointment of four new directors to the board including a new CEO and non -
executive Chairman, creditor restructuring and settlement, review of its existing energy portfolio, Option awards to
directors and a Placing for £500,000.
On 20 June 2024 the Company announced a modification to its announcement on 7 June whereby the number of new
directors to be appointed to the board was reduced from four to two, and a revised reduced placing of £340,000 by
way of new broker sponsored placing and private subscriptions.
On 25 June 2024, the Company announced that it was unlikely it could meet its 30 June 2024 deadline for the
publication of its 2023 audited accounts following which it would be suspended from trading on AIM effective 7.30
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
16
a.m. on 1 July 2024 and also provided details for the admission of the new shares to be issued further to the £340,000
placing announced on 20 June 2024.
On 27 June 2024, the Company announced further changes to the placing details announced on 20 June 2024 as
regards placing amount, placing price, placees and schedule for admission of placing shares to AIM. The placing
amount was increased from £340,000 to £350,000 and at a placing price of 0.0084 pence and the issue of
4,166,666,666 new ordinary Kibo shares. (the “Placing Shares”). The entire placing amount was subscribed for by a
private investor to be settled in two tranches with 1,785,714,286 Placing Shares (Tranche 1) for a consideration of
£150,000, settling immediately and 2,380,952,380 Placing Shares (Tranche 2) for a consideration of £200,000 settling
following Kibo shareholder approval for an increase in authorized share capital of the Company at a General Meeting
to be held as soon as possible after settlement of Tranche 1; and all Kibo creditor conversions as noted in the 7 June
and 20 June RNS Announcement being settled in full. Admission of the shares to AIM was scheduled to coincide with
the lifting of the Company’s share trading suspension, such trading suspension subsequently coming into effect as
anticipated from 30 June 2024 and as announced by the Company on 1 July 2024.
On the 5 July 2024, the Company announced the stepping down of Louis Coetzee as CEO of the Company the
appointment of Cobus van der Merwe as the Interim CEO of the Company.
On 18 July 2024 the Company announced the appointment of Clive Roberts as non-executive chairman of the
Company.
On 5 August 2024, the Company announced the completion of the creditor conversions (credit restructuring) first
announced on 7 June 2024) following shareholder approval for an increase in its authorised capital at its EGM on 25
July 2024 which was required to create sufficient authorised share headroom for the creditor conversion to be
implemented.
On 16 September 2024, the Company announced that it had signed a binding term sheet (the “Term Sheet”) with Swiss
company, ESTI AG to acquire a diverse portfolio of renewable energy projects across Europe and Africa spanning wind
and solar generation, agri-photovoltaics and technology development by way of a proposed reverse takeover
transaction. Under the Term Sheet Aria Capital Management Limited (“Aria), a global asset management company
were to be appointed as the arrange to the reverse takeover transaction.
On the 19 September 2024, the Company announced that it had signed a sale agreement with Aria Capital
Management Limited for the purchase by Aria of Kibo’s its wholly owned subsidiary Kibo Mining (Cyprus) limited
subject to shareholder approval as required under AIM Rules. Shareholder approval was subsequently obtained at a
Kibo EGM on 11 October 2024 from which date the Company was considered an AIM Rule 15 cash shell. As a cash
shell, it was noted that the Company had six months from 11 October 2024 to undertake a Reverse Takeover or
otherwise will be suspended, after which it will have a further six months to complete a Reverse Takeover or
otherwise be cancelled from trading on AIM.
On 3 December 2024, the Company announced that it had terminated the Term Sheet by mutual consent with ESTGI
AG and secured a loan facility for up to £500,000 from Aria (the “Aria Facility”). The Company noted that it had taken
this decision as it believed that it does have sufficient time to secure all relevant information in a timely manner
necessary to complete the ESTGI AG reverse takeover particularly noting the Company will have been suspended for
6 months on 31 December 2024. The Company noted that it will now focus on completing and publishing its audited
accounts to 31 December 2023 and interim accounts to 30 June 2024 before 31 December 2024 to enable the
Company's current suspension from trading on AIM to be lifted. Following resumption of trading, the Company will
be noted that it will seek an alternative project portfolio to proceed with a revised transaction (the “Revised
Transaction”) and that it is already evaluating a number of project acquisition opportunities.
The Aria Facility is to provide the Company with working capital for the next four months (to 31 March 2025) until it
is able to identify and complete a Revised Transaction.
The Company also announced that it had also signed a Deed of Amendment to the terms of its outstanding loan facility
with River Global Opportunities PCC limited (the “RiverFort Loan”). The terms of the RiverFort Loan required
RiverFort’s consent for the Company to enter into another loan facility with another institution.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
17
Disposal, loss of control and deconsolidation of Mast Energy Developments
On 6 June 2024, the Company entered into an agreement with Riverfort Global Opportunities in which it ceded its
loan with Mast Energy Developments Plc (MED) through its subsidiary Kibo Mining (Cyprus) Limited to Riverfort in
partial settlement of its loan with Riverfort. The loan with Riverfort Global Opportunities and a transaction date
balance of £767,205 was reduced to £400,000 in exchange for the cession of the £797,396 loan receivable from MED.
The loan receivable from MED was payable on demand and was historically partially settled with shares issued in
MED. The directors considered the loan and historic precedent of conversion thereof as part of their assessment on
control over MED in terms of IFRS 10.
The directors determined that the combined factors of significant reduction in shareholding in MED during the 2024
year, and the disposal of the loan receivable from MED and resulting convertibility of the loan through shares issued,
resulted in loss of control of MED with effect from 7th of June 2024. From this date onwards MED was recognised as
an associate and equity accounted until the investment in MED was disposed of in full on the 30th of September 2024.
MED’s contribution to 31 December 2023’s Balance Sheet and Profit and Loss is summarised as follows:
Group
2023
(£)
MED
Contribution
2023
(£)
Unconsolidated
Group
2023
(£)
Assets
4,158,362
(2,569,419)
1,588,943
Equity
(2,144,659)
(464,744)
(2,609,403)
Liabilities
(6,303,021)
2,104,675
(4,198,346)
Loss for the year
(5,715,341)
3,539,394
(2,175,947)
As a result of the investment in MED being reclassified as an associate and the Group accounting policy of investments
in listed associates being measured at fair value of the shares at market value, the Group expects impairments and
gains on disposals of MED shares to amount to £12,482 and £268,497 respectively in its 30 June 2024 interim results.
The gain on disposal is as a result of the proceeds from share disposals and the recovery of loan and fair value of the
retained MED shares exceeding the net asset value thereof on disposal date.
The retained investment in MED was disposed of in September 2024 to Riverfort for £120,074.
Disposal of investment in Kibo Energy Botswana Limited
The Group disposed of its interest in Kibo Energy Botswana Limited on 31 January 2024 to Aria Capital Management
Limited for an amount of £70,000. The shareholding of Shumba Energy Limited did not form part of this agreement
and was transferred to Kibo Energy (Cyprus) Limited (KMCL) pending secretarial finalisation. The transfer was
completed in September 2024. The value of Kibo Energy Botswana Limited was represented by the investment in
Shumba Energy Limited of £307,725. As Kibo Energy Botswana was held at a £Nil balance the group expects a profit
on disposal of £70,000 in its 30 June 2024 interim results.
Disposal of investment in Kibo Mining (Cyprus) Limited
The Group disposed of its interest in Kibo Mining (Cyprus) Limited (KMCL) and its subsidiaries on 16 September 2024
for £Nil; the disposal did not include MED which contributed £1,902,936 of the carrying value of KMCL of £2,210,661
as at 31 December 2024. The disposal of the remaining carrying value of £307,725, represented by the investment in
Shumba, will result in a loss on disposal of £307,725 of Kibo for the 2024 year.
These measures summarised above amount to a business re-set for the Company where it intends to move ahead
under the stewardship of the reconstituted board by transitioning Kibo to a broader based energy company,
The discussion of risk and uncertainties on the following section takes regard to the potential acquisition by the
Company of projects in the natural resource and renewable energy areas The term “energy projects” or “energy
assets” refers to both unless otherwise qualified.
The disposals above came about after the restructuring process initiated in 2024.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
18
Principal Risks and Uncertainties
The realisation of energy assets is dependent on the completion of positive integrated bankable feasibility studies and
is subject to a number of significant potential risks summarised as follows, and described further below:
•
strategic risk;
•
funding risk;
•
commercial risk;
•
regulatory risk;
•
operational risk;
•
staffing and key personnel risks;
•
speculative nature of energy assets development;
•
development risk;
•
political stability;
•
uninsurable risks; and
•
foreign investment risks including increases in taxes, royalties and renegotiation of contracts.
Strategic risk
Significant and increasing competition exists for energy development opportunities throughout the world. Because of
this competition, the Company may be unable to acquire, explore, discover and develop attractive energy projects on
terms it considers acceptable. Accordingly, there can be no assurance that the Company will acquire any interest in
energy project opportunities, and should they be successful in doing so, there can be no assurance that would
eventually yield commercial opportunities. The Company expects to undertake comprehensive due diligence where
warranted to help ensure opportunities are subjected to proper evaluation.
Funding risk
In the past the Company has raised funds via equity contributions from new and existing shareholders, thereby
ensuring the Company remains a going concern until such time that revenues are earned through the sale or
development of its projects. Given the proposed expansion of its business strategy from developing a portfolio of
sustainable energy projects in the reserve power, waste-to-energy, biofuel and long duration battery storage sectors
to include seeking opportunities in the Oil and Gas sector, there can be no assurance that such funds will continue to
be available in the required amounts, on reasonable terms, or at all in future. The Directors regularly review cash flow
requirements to ensure the Company can meet financial obligations as and when they fall due.
Commercial risk
The energy sector is competitive and there is no assurance that, even if its existing portfolio of sustainable and
renewable energy projects are developed and/or commercial quantities of hydrocarbons are discovered by the
Company, a profitable market will exist for the realisation of such opportunities. Factors beyond the control of the
Company may affect the economic feasibility of any projects pursued. Development costs are subject to volatile price
changes from a variety of factors including international economic and political trends, expectations of inflation,
global and regional demand, currency exchange fluctuations, interest rates and global or regional consumption
patterns and speculative activities. Ultimately, the Company expects that prior to a development decision, a project
would be the subject of a feasibility analysis to ensure there exists an appropriate level of confidence in its economic
viability.
Regulatory risk
The energy sector is subject to both global and country-specific regulation which is constantly evolving and is
increasingly impacted by the pressure on all governments to reduce their greenhouse gas emissions by promoting
renewable energy projects in favour of fossil fuel projects. Specifically, there is greater regulatory involvement in the
structure of the Oil & Gas sector globally than has been the case over the last 20 years. Therefore, there remains a risk
that future interventions by governments and other regulatory bodies could have an adverse impact on the assets
that the Group intends to acquire, and while the Group will use its experience to acquire oil and gas exploration assets
in those jurisdictions which have stable regulatory regimes and it perceives to be still favourable to and supports
natural resource developments, there can be no assurance that support for such developments will change with time.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
19
Operational risk
Energy projects are subject to hazards normally encountered in acquisition, exploration, development, construction
and production. Although it is intended to take adequate precautions to minimise risk, there is a possibility of a
material adverse impact on the Company’s operations and its financial results should these risks realise outside the
allowable risk parameters. The Company will develop and maintain policies appropriate to the stage of development
of its existing projects and any it acquires.
Staffing and key personnel risks
Recruiting and retaining qualified personnel is critical to the Company’s success. The number of persons skilled in the
energy sector is limited and competition for such persons is intense. While the Company has good relations with its
employees, these relations may be impacted by changes in the scheme of labour relations which may be introduced
by the relevant governmental authorities. Adverse changes in such legislation may have a material adverse effect on
the Company’s business, results of operations and financial condition. Staff are encouraged to discuss with
management matters of interest to the employees and subjects affecting day-to-day operations of the Company.
Speculative nature of energy asset development
There can be no assurance that the discovery and development of energy assets will result in profitable project
execution. The recoverability of the carrying value of oil & gas assets, for example is dependent on the achievement
of discovery, successful development of the underlying projects to commercial viability and the ability of the Company
to raise additional financing, if necessary, or alternatively upon the Company’s ability to dispose of its interests on an
advantageous basis. Changes in market conditions may result in material write downs of the carrying value of the
Company’s assets.
Development of energy projects is, amongst others, contingent upon obtaining satisfactory feasibility results and
securing additional adequate funding. Energy asset development, particularly Oil & Gas, involves substantial expense
and relatively long-time horizons to development following discovery, implying a high degree of risk, which even a
combination of experience, knowledge and careful evaluation may not be able to adequately mitigate. The degree of
risk reduces substantially when a company’s properties move from the concept phase to the advanced feasibility
phase. Management will continuously assess funding requirements against project viability and prioritise key projects
over the short to medium term.
The development of energy assets is dependent upon several factors including the technical skill of the personnel
involved. The commercial viability of a project, once acquired, is also dependent upon a number of factors, including
proximity to infrastructure, energy prices and government regulations, including regulations relating to allowable
production and environmental protection. In addition, several years can elapse from acquisition, discovery (in the
case of Oil & Gas) and development to when commercial operations are commenced.
Political stability
The Company will likely be conducting its operational activities in various countries and regions. The directors will
satisfy themselves that the governments of these countries support the development of natural resources by foreign
investors and actively monitor the situation. However, there is no assurance that future political and economic
conditions in these countries will not result in their governments adopting different policies regarding foreign
development and ownership of oil & gas resources. Any changes in policy affecting ownership of oil & gas assets,
taxation, rates of exchange, environmental protection, labour relations, repatriation of income and return of capital,
may affect the Company’s ability to develop its projects.
Uninsurable risks
The Company may become subject to liability for accidents, pollution and other hazards against which it cannot insure
or against which it may elect not to insure because of prohibitive premium costs or for other reasons, such as amounts
which exceed policy limits. The company chooses to manage these risks, as best possible, through cautious business
practice, on a continuous basis.
Foreign investment risks including increases in taxes, royalties and renegotiation of contracts
The Group is subject to risk arising from the ever-changing economic environment in which its subsidiaries operate,
mainly driven by the changing regulatory environment governing corporate taxation, transfer pricing and other
investment related operational activities. The Group continues to re-assess its investment decisions to limit exposure
to the ever-changing regulatory environment in which it operates.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
20
Directors’ Interests
The interests of the directors and Company secretary (held directly and indirectly), who held office at the date of
approval of the financial statements, in the share capital of the Company are as follows:
Ordinary Shares (held directly and indirectly)
18 December 2024
31 December 2023
31 December 2022
Directors & Secretary
Ajay Saldanha (retired 10
January 2024)
n/a
-
n/a
Clive Roberts
1,805,733,828
n/a
n/a
Cobus van der Merwe
(appointed 11 January
2024)
88,642,857
-
-
Louis Coetzee (resigned 5
July 2024)
n/a
223,198,427
19,505,996
Noel O’Keeffe
57,234,904
7,037,047
7,037,047
Warrants (held directly and indirectly)
18 December 2024
31 December 2023
31 December 2022
Directors & Secretary
Ajay Saldanha
n/a
-
n/a
Clive Roberts
1,698,095,238
n/a
n/a
Cobus van der Merwe
-
n/a
n/a
Louis Coetzee
n/a
-
5,720,000
Noel O’Keeffe
39,816,997
-
-
Warrants
Date of Grant
Vesting date
Expiry date
Exercise
price
Number
granted
Exercisable as
at 31
December
2023
09 February 2024
09 February 2024
08 February 2027
0.13p
39,816,997
-
09 February 2024
09 August 2024
08 February 2026
0.25p
48,000,000
-
09 February 2024
09 August 2024
08 February 2026
0.25p
30,000,000
-
05 August 2024
05 August 2024
04 August 2027
0.01p
1,620,095,238
-
1,737,912,235
-
For further detail surrounding the ordinary shares, share options and warrants in issue, refer to Notes 16 and 18 of
the annual financial statements.
Transactions Involving Directors
There have been no contracts or arrangements of significance during the period in which Directors of the Company,
or their related parties, were interested other than as disclosed in Note 24 to the annual financial statements.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
21
Directors’ meetings
The Company held twenty-five (25) Board meetings during the reporting period and the number of meetings attended
by each of the directors of the Company during the year to 31 December 2023 were:
Director Name
Position
Number of
Meetings Attended
Number of
Meetings Eligible to
Attend
Louis Coetzee*
Chief Executive Officer
25
25
Christiaan Schutte**
Executive Director
9
9
Ajay Saldanha***
Non- Executive Director
25
25
Clive Roberts+
Non-Executive Chairman
-
-
Cobus van der Merwe++
Chief Executive Officer
-
-
Noel O’Keeffe
Non-Executive Director
25
25
*Retired on 5 July 2024
**Retired on 2 May 2023
***Retired on 10 January 2024
+ Appointed 18 July 2024
++Appointed 5 July 2024
Under the Company’s Memorandum & Articles of Association, one third of directors are required to retire by rotation
from the Board on an annual basis, through resignation at the Annual General Meeting (AGM) and may put themselves
forward again for re-election at the AGM.
Committee meetings
The Company held two (2) Audit Committee meetings during the reporting period and the number of meetings
attended by each of the members during the year to 31 December 2023 were:
Director Name
Position
Number of
Meetings Attended
Number of
Meetings Eligible to
Attend
Noel O’Keeffe
Sole Member
2
2
The Company held no (0) Remuneration Committee meetings during the reporting period and the number of meetings
attended by each of the members during the year to 31 December 2023 were:
Director Name
Position
Number of
Meetings Attended
Number of
Meetings Eligible to
Attend
Ajay Saldanha**
Chairman
n/a
n/a
Noel O’Keeffe
Member
n/a
n/a
**Appointed on 24 January 2023
The Company held one (1) Governance Committee meeting during the reporting period and the number of meetings
attended by each of the members during the year to 31 December 2023 were:
Director Name
Position
Number of
Meetings Attended
Number of
Meetings Eligible to
Attend
Noel O’Keeffe
Chairman
1
1
Ajay Saldanha**
Member
1
1
**Appointed on 24 January 2023
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
22
Significant Shareholders
According to the latest information available to the Company, in addition to the interests of the directors, at 31
December 2023 and at the date of this report, the following shareholders own 3% or more beneficial interest, either
direct or indirect, of the issued share capital of the Company, which is considered significant for disclosure purposes
in the annual financial statements:
Percentage of issued share capital
18 December 2024
31 December 2023
31 December 2022
Sanderson Capital Partners Limited
3.54%
10.28%
12.79%
Peter Williams
28.32%
-
-
Tsitato Trading Limited
21.20%
-
-
Mzuri Exploration Services Limited
3.56%
-
-
RiverFort Global Opportunities PCC
Limited
3.25%
4.94%
-
Spreadex (Clive Roberts)
12.27%
3.49%
-
Subsidiary Undertakings
Details of the Company’s subsidiary undertakings are set out in Note 23 to the annual financial statements.
Political Donations
During the period, the Group made no charitable or political contributions (2022 £ Nil).
Going Concern
The financial statements have been prepared on the going concern basis which contemplates the continuity of normal
business activities and the realisation of assets and the settlement of liabilities in the normal course of business. In
performing the going concern assessment, the Board considered various factors, including the availability of cash and
cash equivalents; data relating to working capital requirements for the foreseeable future; cash-flows from
operational commencement, available information about the future, the possible outcomes of planned events, changes
in future conditions, the current global economic situation due to the ongoing Ukraine and Israel and Gaza conflicts,
and the responses to such events and conditions that would be available to the Board.
The Board has, inter alia, considered the following specific factors in determining whether the Group is a going
concern:
•
The significant financial loss for the year amounting to £5,715,341 (2022: £10,908,524);
•
Cash and cash equivalents readily available to the Group in the amount of £64,057 in order to pay its creditors
and maturing liabilities in the amount of £5,453,266 as and when they fall due and meet its operating costs for
the ensuing twelve months (2022: £163,884 and £4,192,170 respectively);
•
Whether the Group has available cash resources, or equivalent short term funding opportunities in the
foreseeable future, to deploy in developing and growing existing operations or invest in new opportunities;
and
•
Investment and associated funding opportunities available to the company after disposal of its Cyprus
subsidiary, Kibo Mining (Cyprus) Limited effective on 11 October as disclosed in note 26 (the “KMCL Disposal”),
following which the Company became an AIM Rule 15 cash shell. Given the Company’s limited available cash
resources post the KMCL Disposal and considering the Company’s status as a cash shell, the Board is
considering various investment opportunities to acquire a portfolio of assets as part of a Reverse Takeover
transaction (“RTO”) as envisaged under the AIM Rules which will coincide with a substantial fundraise to
provide the Company with sufficient working capital to meet its overhead and project development
commitments post RTO.
Following from the losses incurred in the current financial period, coupled with the net current liability position the
Group finds itself in as at December 2023, these conditions, together with those mentioned above are considered to
indicate that a material uncertainty exists which may cast significant doubt on the Group’s ability to continue as a
going concern.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
23
This is largely attributable to the short-term liquidity position the Group finds itself in as a result of the significant
capital required to meet its obligations that exceeds cash contributed to the Group by the capital contributors. The
Directors have evaluated the Group’s liquidity requirements to confirm whether the Group has adequate cash
resources to continue as a going concern for the foreseeable future, taking into account the net current liability
position, and consequently prepared a cash flow forecast covering a period of 12 months from the date of approval of
these financial statements, concluding that the Group would be able to continue its operations as a going concern.
In response to the net current liability position, to address future cash flow requirements, detailed liquidity
improvement initiatives have been identified and are being pursued, with their implementation regularly monitored
in order to ensure the Group is able to alleviate the liquidity constraints in the foreseeable future. Therefore, the ability
of the Group to continue as a going concern is dependent on the successful implementation or conclusion of the below
noted matters in order to address the liquidity risk the Group faces on an ongoing basis:
•
Successful conclusion of funding initiatives of the Group in order to keep the Company in good standing until
the successful completion of a reverse takeover transaction as the Company pursues its objective to acquire
a new portfolio of assets; and
•
Successful completion of a reverse takeover transaction as required under AIM Rule 15 given that the
Company became a cash shell on 11 October 2024 with the disposal of its subsidiary, Kibo Mining (Cyprus)
Limited.
Further to the above, on 3 December 2024 the Company announced that it had secured a loan facility for up to £500,000
from Aria Capital Management Limited (“Aria”) (the “Aria Facility”). The Company has received the first payment totalling
£122,585 under the Aria Facility. The purpose of the Aria Facility is to provide the Company with working capital until
it is able to identify and complete a reverse takeover transaction. Aria has also provided the Company with written
confirmation, which is effective for a period until 31 December 2025, that it will support the Company in its capacity
as lender under the Aria Facility and advisor to the Company, as follows:
•
Assist the Company in the timely sourcing and procurement of an appropriate project portfolio as part a
reverse takeover transaction;
•
Assist the Company to raise appropriate funding to the Company in good standing until completion of a
reverse takeover transaction to enable the Company to continue as a going concern for the foreseeable future;
and
•
Aria will not recall or demand cash repayment of the Aria Facility provided to the Company, except insofar as
the funds of the Company permit repayment and that such repayment will not adversely affect the ability of
the Company to carry on its business operations as a going concern.
As the Board is confident it would be able to successfully implement the above matters, it has adopted the going
concern basis of accounting in preparing the consolidated financial statements.
Environmental responsibility
The Company recognises that its activities require it to have regard to the potential impact that it, its subsidiaries and
partners may have on the environment. Where exploration and development works are carried out, care is taken to
limit the amount of disturbance and where any remediation works are required, they are carried out as and when
required.
Dividends
There have been no dividends declared or paid during the current financial period (2022: £ Nil).
Corporate Governance Policy
The Board is aware of the importance to conform to its statutory responsibilities and industry good practice in relation
to corporate governance of the Group.
The Board is accountable to the shareholders for delivery of sustained value growth. In order to support its duties
and responsibilities the Board implements control procedures that assess and manage risk and ensure robust
financial and operational management within the Company. The principal risks that the Company is exposed to can
be classified under the general headings of exploration risk, commodity risk, price risk, currency risk and political
risk.
The Board also sets the Company’s core values and ethical standards of business conduct ensuring these are
effectively communicated to all staff and are monitored continuously by the Board.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
24
The Board sets the Company’s strategy and monitors its implementation through management and financial
performance reviews. It also works to ensure that adequate resources are available to implement strategy in a timely
manner.
The Company subscribes to the values of good corporate governance at all levels and is committed to conduct business
with discipline, integrity and social responsibility. The Board of Directors is firmly committed to promoting Kibo
Energy PLC’s adherence to the principles contained in the QCA Corporate Governance Code (2018) (“QCA Code”), and
constantly reviews its performance against the QCA Code. The Directors are committed to the implementation of the
principles and non-compliance is limited to the matter listed in this report. In compliance with its statutory, AIM &
JSE listing obligations, the directors present a Corporate Governance Report on page 6.
Internal Audit
The Company does not have an internal audit function. Currently the operations of the Group do not warrant an
internal audit function, however the Board is assessing the need to establish an internal audit department considering
future prospects as the Group’s operations increase. During the period the Board has taken responsibility to ensure
effective governance, risk management and that the internal control environment is maintained.
Health, Safety and Environmental Policy
The Group is committed to high standards of Health, Safety and Environmental performance across our business. Our
goal is to protect people, minimise harm to the environment, integrate biodiversity considerations and reduce
disruption to our neighbouring communities. We seek to achieve continuous improvement in our Health, Safety and
Environmental performance.
Corporate Social Responsibility Policy (CSR)
The Group’s policy is to conduct all our business operations to best industry standards and to behave in a socially
responsible manner. Our goal is to behave ethically and with integrity and to respect cultural, national and religious
diversity.
Governance of IT
The Board is responsible for IT governance as an integral part of the Group’s governance as a whole. The IT function
is not expected to significantly change in the foreseeable future. The Board has the required policies and procedures
in place to ensure governance of IT is adhered to.
Integrated and Sustainability Reporting
Integrated Reporting is defined as a “holistic and integrated representation of the Group’s performance in terms of
both its finances and its sustainability”. The Group currently does not have a separate integrated report. The Board
and its sub-committees are in the process of assessing the principles and practices of integrated reporting and
sustainability reporting to ensure that adequate information about the operations of the Group, the sustainability
issues pertinent to its business, the financial results and the results of its operations and cash flows are disclosed in a
single report.
Accounting records
The measures taken by the directors to ensure compliance with the requirements in Sections 281 to 285 of the
Companies Act 2014, regarding proper books of account, are the implementation of necessary policies and procedures
for recording transactions, the employment of competent accounting personnel with appropriate expertise and the
provision of adequate resources to the financial function. The books of account of the Company are maintained at 119
Witch-Hazel Avenue, Highveld Technopark, Centurion 0157, South Africa.
Auditors
The auditors, Crowe Ireland, were re-appointed as the Company’s auditors at the last Annual General Meeting and
have indicated their willingness to continue in office in accordance with section s383(2) of the Companies Act 2014.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ REPORT
25
Provision of information to the auditor
Each of the persons who are Directors at the time when this Directors’ Report is approved has confirmed that:
•
So far as that Director is aware, there is no relevant audit information of which the Company’s auditor is
unaware, and
•
That Director has taken all the steps that ought to have been taken as a director in order to be aware of any
information needed by the Company’s auditors in connection with preparing their report and to establish
that the Company’s auditor is aware of that information.
Compliance statement
The directors acknowledge that they are responsible for securing the Company's compliance with the Company's
''relevant obligations'' within the meaning of section 225 of the Companies Act 2014 (described below as the ''relevant
obligations'').
The directors confirm that they have:
•
drawn up a compliance policy statement setting out the Company's policies (that are, in the opinion of the
directors, appropriate to the Company) in respect of the Company's compliance with its Relevant Obligations;
•
put in place appropriate arrangements or structures that, in the opinion of the Directors, provide a reasonable
assurance of compliance in all material respects with the Company's Relevant Obligations; and
•
during the financial year to which this report relates, conducted a review of the arrangements of structures
that the directors have put in place to ensure material compliance with the Company's Relevant Obligations.
On behalf of the Board
Cobus van der Merwe
Noel O’Keeffe
20 December 2024
20 December 2024
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
DIRECTORS’ STATEMENT OF RESPONSIBILITIES
26
The directors are responsible for preparing the Group and Company financial statements in accordance with
applicable Laws and Regulations.
Irish Company law requires the directors to prepare Group and Company financial statements for each financial year.
As permitted by Company law, the directors have prepared the Group financial statements in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European Union (EU IFRS) and have elected to
prepare the Company financial statements, as applied in accordance with the provisions of the Companies Act 2014.
The Group and Company financial statements are required by law and EU IFRS to present fairly the financial position
and performance of the Group. References in the relevant part of the Companies Act 2014 to financial statements
giving a true and fair view are provided for in the Act to mean such references to the financial statements achieving a
fair presentation. Under company law the Directors must not approve the Group and Company financial statements
unless they are satisfied that they give a true and fair view of the assets, liabilities and financial position of the Group
and Company and of the Group’s profit or loss for that year. In preparing each of the Group and Company financial
statements, the directors are required to:
•
select suitable accounting policies and then apply them consistently;
•
make judgements and estimates that are reasonable and prudent;
•
state whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements; 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 confirm they have complied with the above requirements in preparing these accounts.
Under applicable law the directors are also responsible for preparing a Directors’ Report and reports relating to
directors’ remuneration and corporate governance that comply with that law and those rules.
The directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at
any time the financial position of the Company and which enable them to ensure that its financial statements are
prepared in accordance with International Financial Reporting Standards, and comply with the Companies Act 2014,
and European Communities (Companies: Group Accounts) Regulations 1992 and all regulations to be construed as
one with those acts. They are also responsible for taking such steps as are reasonably open to them to safeguard 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 Republic of Ireland governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
On behalf of the Board
Cobus van der Merwe
Noel O’Keeffe
20 December 2024
20 December 2024
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
AUDIT COMMITTEE REPORT
27
I am pleased to present this report on behalf of the Audit Committee and to report on the progress made by the
Committee during the year.
Aims of the Audit Committee
Our purpose is to assist the Board in managing risk, discharging its duties regarding the preparation of financial
statements, ensure that a robust framework of accounting policies is in place and enacted and oversee the
maintenance of proper internal financial controls.
The Audit Committee currently comprises, Noel O’Keeffe and Clive Roberts who was co-opted on to the Audit
Committee on 15 August 2024. The Committee aims to meet at least once each year, and its key responsibilities
include monitoring the integrity of the Group’s financial reporting and to approve and recommend the annual
financial statements to the Board. The Chief Executive Officer and Chief Financial Officer are invited to attend meetings
of the Audit Committee.
The Audit Committee is committed to:
•
Maintaining the integrity of the financial statements of the Company and reviewing any significant reporting
matters therein;
•
Reviewing the Annual & Interim Report and Accounts and monitoring the accuracy and fairness of the
Company’s financial statements;
•
Ensuring compliance of financial statements with applicable accounting standards and the AIM & JSE Rules;
•
Reviewing the adequacy and effectiveness of the internal financial control environment and risk management
systems; and
•
Overseeing the relationship with and the remuneration of the external auditor, reviewing their performance
and advising the Board members on their appointment.
The Audit Committee did not meet during 2023 as it comprised of just one member, Noel O’Keeffe. Mr. O’Keeffe carried
out all duties described below on a continuous basis and references to the Audit Committee below refer to the
activities of Mr. O’Keeffe.
Activities of the Audit Committee during the year
On behalf of the Board, the Audit Committee has closely monitored the maintenance of internal controls and risk
management during the year. Key financial risks are reported during each Audit Committee meeting, including
developments and progress made towards mitigating these risks.
The Audit committee received and reviewed reports from the Chief Financial Officer, other members of management
and external auditors relating to the interim and annual accounts and the accounting and internal control systems in
use throughout the Group.
The external auditors attended meetings to discuss the planning and conclusions of their work and met with members
of the committee. The committee was able to call for information from management and consult with the external
auditors directly as required.
The objectivity and independence of the external auditors was safeguarded by reviewing the auditors’ formal
declarations, monitoring relationships between key audit staff and the Company and tracking the level of non-audit
fees payable to the auditors. Significant attention was given to the level of non-audit fees provided.
As noted above, the committee met twice during the year, to review the 2022 annual accounts and the interim
accounts to 30 June 2023. Members of the committee reviewed with the independent auditor its judgements as to the
acceptability of the Company’s accounting principles.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
AUDIT COMMITTEE REPORT
28
Since the year end the committee has met further with the auditors to consider the 2023 financial statements. In
particular, the committee discussed the significant audit risks, accounting for acquisitions and disposals during the
year and the application of the new accounting standard. In addition, the committee monitors the auditor firm’s
independence from Company management and the Company.
___________________________
Noel O’Keeffe
Chairman
Audit Committee
20 December 2024
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
29
To the Shareholders of Kibo Energy Plc
Report on the Audit of the Consolidated Financial Statements
Qualified Opinion
We have audited the consolidated financial statements of Kibo Energy Plc (“the Company”) and its subsidiaries (the
“Group”) for the year ended 31 December 2023, which comprise the Consolidated Statement of Profit or Loss and
Other Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Profit or
Loss and Other Comprehensive Income, the Company Statement of Financial Position, the Consolidated Statement of
Changes in Equity, the Company Statement of Changes in Equity, the Consolidated Statement of Cash Flows, the
Company Statement of Cash Flows, the Summary of Material Accounting Policies and the related notes to the
consolidated financial statements. The financial reporting framework that has been applied in their preparation is
Irish Law and International Financial Reporting Standards (“IFRSs”), as adopted by the EU.
In our opinion, except for the possible effects of the matter described in the Basis of Qualified Opinion section of our
report, the accompanying consolidated financial statements:
•
give a true and fair view of the consolidated financial position of the Group as at 31 December 2023 and of the
profit or loss and cash flows of the Group for the year then ended;
•
give a true and fair view of the financial position of the Company as at 31 December 2023 and of the Company
profit or loss and cash flows for the year then ended;
•
have been properly prepared in accordance with International Financial Reporting Standards (“IFRSs”), as
adopted by the EU; and
•
have been properly prepared in accordance with the requirements of the Companies Act 2014.
Basis for Qualified Opinion
The Group’s investment in Shankley Biogas Limited, a company acquired under a Share Purchase Agreement effective
on 30 September 2022, is carried in the Company Balance Sheet at cost of £600,000 less an impairment provision of
£600,000, while the Group Balance Sheet includes an amount capitalised in Intangible Assets for Project Development
Rights of £603,050 less an impairment provision for £603,050, development costs of £939,664 and associated current
liabilities of £950,326, while the Company Statement of Profit and Loss includes an impairment cost of £600,000 in
respect of the investment cost of the shares, and the Group Statement of Profit and Loss includes an impairment cost
of £603,050 in respect of the Intangible asset. The acquisition is also subject to ongoing disputes between the seller
and the Company. We were unable to obtain sufficient appropriate audit evidence about the carrying value of the
Company investment, the Group Intangible Assets, the Group Development costs and associated liabilities as at 31
December 2022 and 31 December 2023 and the impairment costs in both the Company and Group Statements of
Profit and Loss and Other Comprehensive Income recognised in the year ended 31 December 2023, because
management were unable to provide access to sufficient and reliable financial information for Shankley Biogas
Limited. Consequently, we were unable to determine whether any adjustments to these amounts were necessary.
We conducted our audit in accordance with International Standards on Auditing (Ireland) (“ISAs (Ireland)”). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the
International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code), and
we have fulfilled our other ethical responsibilities in accordance with the IESBA Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified
opinion.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
30
Material uncertainty relating to going concern
We draw attention to the Section headed Going Concern on page 22 of the financial statements, which details the
factors the Company has considered when assessing the going concern position. As detailed in the relevant note on
pages 44 to 45, the uncertainty surrounding the availability of funds to finance ongoing working capital requirements
and the financing of commercial projects of the Group through to the stage of cash generation indicates the existence
of a material uncertainty that may cast significant doubt on the Group’s ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Our responsibilities with respect to Going Concern are described further the Auditor’s Responsibilities for the Audit
of the Consolidated Financial Statements section of this report while the directors’ responsibilities are described
further in the Responsibilities of Management and Those Charged with Governance for the Consolidated Financial
Statements section.
Overview of our audit approach
Our application of materiality
In planning and performing our audit we use the concept of materiality. An item is considered material if it could
reasonably be expected to change the economic decisions of a user of the financial statements. Materiality is used as
to help establish our areas of audit focus and to evaluate the impact of misstatements identified in the course of the
audit.
Materiality for the Group financial statements as a whole was set at £208,000 (2022: £190,000) This was based on
5% of the Group Total Assets at the balance sheet date. Parent company materiality was set at £125,000 (2022:
£174,000) based on 5% of total assets of the Company.
We use Performance Materiality to determine the nature and extent of our audit testing. Performance Materiality is a
measure based on overall audit materiality (as above) adjusted downwards for the judgements we make as to entity
risk and specific risks around each audit area, having regard to the internal control environment.
For certain items such as related party transactions and directors’ remuneration disclosures, we may reduce
performance materiality further.
All errors identified in excess of 5% of Materiality (£10,400) (2022: £9,500) are reported to the Audit Committee.
Other errors below this threshold may be reported to the Audit Committee on qualitative grounds, if we believe
warranted.
Overview of the scope of our audit
The Group operates in seven main jurisdictions: Ireland, the UK, Cyprus, Tanzania, Botswana, South Africa and
Mozambique. The audit of Kibo Energy plc was conducted from Ireland. The transactions undertaken in Ireland are
Corporate and administrative in nature, principally capital fund raising and associated costs, professional fees and the
administration and incurrence of exploration and development expenditure on behalf of subsidiaries. 2023 was the
second year of significant revenue generation in the Group within the MAST Energy Developments plc sub-group and
this formed an area of focus.
We engaged member firms of the Crowe international network to undertake work on the UK and Cyprus subsidiaries
under our direction. Following discussions at the planning stage, we issued instructions to the network firms that set
out the significant risks to be addressed and the information we required to be reported. We further reviewed and
discussed their working papers on key findings, as well as obtaining information directly from management on
matters accounted for at subsidiary level but significant at group level.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
consolidated financial statements of the current period. These matters were addressed in the context of our audit of
the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
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KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
31
Key audit matter
How the scope of our audit addressed the key audit matter
Carrying value of indefinite life intangibles
Intangible assets with an indefinite life must be
tested for impairment on an annual basis. The
determination of their recoverable amount
requires judgement on the part of management
in both identifying and then valuing the
relevant cash generating units especially for
projects
where
there
is
an
uncertain
timeframe.
At the balance sheet date. the Group had
upstream and downstream power generation
and delivery projects in Tanzania (Mbeya Coal
to Power (MCPP), the UK (Rochdale Power,
Bordersely, Shankley/Southport, Hindlip and
Stather ) and South Africa (Sustineri Project).
Intangible assets capitalised at cost amounted
to £4.96m, with no significant additions in the
year. Impairments of £2.2m were recognised
during the year and at 31 December 2023,
intangibles totalled £0.4m (2022: £2.7m).
Certain of the assessments for impairment of
intangibles in the Group are underpinned by
Value in Use calculations of projects, the key
assumptions for which are set out on pages 71
to 72 of the financial statements.
We considered the risk whether indicators of
impairment may exist as well as the risk of
misstatements of the estimated fair value of
assets impaired during the year.
Our procedures to obtain comfort that the balance of the
indefinite life intangible assets is not materially misstated,
included:
-
Discussing and challenging management as to the status
of the projects’ developments and future planned
exploration
and
development
and
management
intentions on those projects, particularly in light of the
Group’s activity in 2024 and the disposal of legacy coal-
based assets;
-
Considering and challenging management’s impairment
review together with the calculations and basis for the
impairment provisions on the Hindlip Lane and
Bordersley intangibles and goodwill. This involved
reviewing and challenging the Value in Use calculations
(including the assumptions used)
prepared
by
Management as part of their review for impairment on
the UK assets and ensuring the accuracy of the
disclosures in the financial statements on the
assumptions used.
-
Discussing and reviewing the post year end movements
on investments in the subsidiaries companies in which
intangible assets are held in order to assess whether the
impairments recognised at 31 December 2023 were
appropriately supported by post year end transactions,
in particular with reference to the Mast Energy
Developments Plc assets and the Sustinieri assets;
-
Reviewing whether the accounting policies adopted and
applied by the Group for the exploration and evaluation
assets were consistent with IFRS 6;
-
Assessing whether the disclosures in relation to the
valuation of the intangible assets are compliant with the
relevant financial reporting requirements, in particular
as non-current assets.
Our findings
We have obtained sufficient comfort that the Group has
accounted for its indefinite life intangibles in accordance with
applicable standards and with the accounting policies as set out.
Treatment of the Investment in Mast Energy
Developments Limited sub-group (“MED”) as a
subsidiary for consolidation purposes
During 2023, the Kibo Group’s interest in MED
reduced from 57% at the start of the year to
42% at the year end. The Company has
continued to account for MED as a fully
consolidated subsidiary on the basis that Kibo
continued to exercise control over MED at the
financial year end date.
The gross assets of MED included in the Kibo
consolidated balance sheet totalled £2.6M at the
year end, alongside gross liabilities of £2.98M,
capital and equity reserves of (£0.4M)and a
Non-Controlling Interest of £0.27M .
Our procedures to obtain comfort that the balance of the
associate asset is not materially misstated, included:
-
Obtaining
and
reviewing
written
technical
memorandum which formed the basis by which
management
have
concluded
the
technical
appropriateness of continuing to consolidate a sub-
group in which the balance sheet date interest had
decreased below 50%;
-
Considering and challenging management’s contention
that Kibo continued to exercise “control” over MED by
virtue of its position as both a significant creditor with
share conversion rights and the main shareholder bloc,
including by review to supporting documentation.
-
Assessing whether appropriate and full disclosures
have been made in the financial statements to set out the
basis on which management have concluded it to be
appropriate to consolidate.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
32
We considered the risk whether the accounting
treatment adopted by the Company in respect
of MED was appropriate.
Our findings
We have obtained sufficient comfort that the Group has
accounted for its investment in MED in accordance with
applicable standards and with the accounting policies as set out.
Carrying value of the Company’s Net Investment
in Kibo Cyprus and sub-subsidiaries
The Company has net balance sheet investment
in Kibo Cyprus amounting to £2.2M after prior
year impairment provisions of £41.7M and a
further provision of £3.3M in the current year.
The carrying value of Kibo Mining Cyprus is
underpinned by the interests it holds in
subsidiaries and related projects in the UK
(MAST
Energy
Developments),
Tanzania
(Mbeya), Botswana (Mabesekwa), Mozambique
(Benga) and South Africa (Sustineri). The
Group has evaluated the underlying assets and
concluded that factors related to impairments
projects in the United Kingdom subsidiaries will
also result in an impairment to the value of
£3.4M to the investment in Kibo Cyprus.
We considered the risk whether indicators of
impairment may exist as well as the risk of
misstatements of the estimated fair value of
assets impaired during the year.
Our procedures to obtain comfort that the balance of the
associate asset is not materially misstated, included:
-
Obtaining and reviewing documentation supporting the
ownership and rights and obligations assertions in
relation to the investments in Kibo Cyprus and its
subsidiaries;
-
Comparing the carrying value of the Company’s
investment in Kibo Cyprus to the consolidated net asset
position of Kibo Cyprus;
-
Discussing and challenging management as to the status
of each of the entities under Kibo Cyprus and the
associated
projects
along
with
the
projects’
developments and future planned exploration and
development and management intentions on the
project, particularly in light of the post year end
reorganisation of the Company’s investments;
-
Considering and challenging management’s impairment
review together with the calculations and basis for the
impairment charge on the investment in Kibo Cyprus in
particular with reference to the post year end disposal
of that investment;
-
Assessing whether the disclosures in relation to the
valuation of the investment are compliant with the
relevant financial reporting requirements, in particular
with IAS36;
Our findings
We have obtained sufficient comfort that the Company has
accounted for its investment in the subsidiary in accordance
with applicable standards and with the accounting policies as set
out.
We refer to the Basis of Qualified Opinion section of our Report wherein we have set out a matter giving rise to a
modified opinion. We also refer to the Material uncertainty relating to going concern section of our report. Both these
matters are Key Audit Matters but have been reported on individually in the respective sections of our report, in
accordance with ISA 701.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
33
Other information
The directors are responsible for the other information. The other information comprises the information included in
the Annual report, other than the financial statements and our Auditors' report thereon. Our opinion on the financial
statements does not cover the other information and, except to the extent otherwise explicitly stated in our report,
we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other information. If, based on the work
we have performed, we conclude that there is a material misstatement of this other information, we are required to
report that fact.
We have nothing to report in this regard.
Opinion on other matters prescribed by the Companies Act 2014
Based solely on the work undertaken in the course of the audit, we report that:
•
in our opinion, the information given in the Directors' Report is consistent with the financial statements; and
•
in our opinion, the Directors' Report has been prepared in accordance with applicable legal requirements.
We have obtained all the information and explanations which we consider necessary for the purposes of our audit.
In our opinion the accounting records of the Company were sufficient to permit the financial statements to be readily
and properly audited, and the financial statements are in agreement with the accounting records.
Matters on which we are required to report by exception
Based on the knowledge and understanding of the Company and its environment obtained in the course of the audit,
we have not identified any material misstatements in the Directors' Report.
The Companies Act 2014 requires us to report to you if, in our opinion, the disclosures of directors' remuneration and
transactions required by sections 305 to 312 of the Act are not made. We have nothing to report in this regard.
Respective responsibilities and restrictions on use
Responsibilities of Management and Those Charged with Governance for the Consolidated Financial
Statements
As explained more fully in the Directors' Responsibilities Statement on page 26, the directors are responsible for the
preparation of the consolidated 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 the consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’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 management either intends to liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
34
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated 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 (Ireland) 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 consolidated financial statements.
As part of an audit in accordance with ISAs (Ireland), we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the consolidated financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control;
•
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal control;
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by management;
•
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group to cease to continue as a going concern;
•
Evaluate the overall presentation, structure and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation;
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the consolidated financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
INDEPENDENT AUDITOR’S REPORT
35
The purpose of our audit work and to whom we owe our responsibilities
This report is made solely to the Company's members in accordance with Section 391 of the Companies Act 2014. 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 Auditors' 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 for our audit work, for this
report, or for the opinions we have formed.
_________________________________________
for and on behalf of
Crowe Ireland
Chartered Accountants and Statutory Audit Firm
40 Mespil Road
Dublin 4
Date: __________________
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
20/12/2024
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
36
All figures are stated in Sterling
31 December
2023
31 December
2022
Audited
Audited
Notes
£
£
Revenue
2
341,207
1,036,743
Cost of sales
(223,838)
(778,802)
Gross profit
117,369
257,941
Administrative expenses
(2,164,670)
(2,579,028)
Impairment of non-current assets
5
(2,289,372)
(7,038,930)
Listing and capital raising fees
(855,323)
(363,368)
Project and exploration expenditure
(326,093)
(847,567)
Operating loss
(5,518,089)
(10,570,952)
Investment and other income
3
105,734
93,866
Share of loss from associate
(97,340)
(181,684)
Finance costs
4
(205,646)
(249,754)
Loss before tax
5
(5,715,341)
(10,908,524)
Taxation
8
-
-
Loss for the period
(5,715,341)
(10,908,524)
Other comprehensive loss:
Items that may be classified subsequently to profit or loss:
Exchange differences on translation of foreign operations
576,313
372,191
Exchange differences reclassified on disposal of foreign operation
6,195
-
Other Comprehensive loss for the period net of tax
582,508
372,191
Total comprehensive loss for the period
(5,132,833)
(10,536,333)
Loss for the period
(5,715,341)
(10,908,524)
Attributable to the owners of the parent
(3,854,280)
(9,776,917)
Attributable to the non-controlling interest
(1,861,061)
(1,131,607)
Total comprehensive loss for the period
(5,132,833)
(10,536,333)
Attributable to the owners of the parent
(3,277,967)
(9,404,726)
Attributable to the non-controlling interest
(1,854,866)
(1,131,607)
Loss Per Share
Basic loss per share
9
(0.001)
(0.003)
Diluted loss per share
9
(0.001)
(0.003)
All activities derive from continuing operations.
The accompanying notes on pages 57-91 form an integral part of these financial statements.
The financial statements were approved and authorised for issue by the Board of Directors on 20 December 2024 and
signed on its behalf by:
On behalf of the Board
________________________
________________________
Cobus van der Merwe
Noel.O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
37
All figures are stated in Sterling
31
December
2023
31
December
2022
Audited
Audited
Notes
£
£
Assets
Non-current assets
Property, plant and equipment
10
3,021,547
3,493,998
Intangible assets
11
397,779
2,691,893
Investments in associates
12
124,982
100,945
Other financial assets
13
307,725
-
Total non-current assets
3,852,033
6,286,836
Current assets
Other receivables
14
242,272
227,223
Cash and cash equivalents
15
64,057
163,884
Total current assets
306,329
391,107
Total assets
4,158,362
6,677,943
Equity and liabilities
Equity
Called up share capital
16
21,790,988
21,140,481
Share premium account
16
45,816,001
45,516,081
Share based payments reserve
18
-
73,469
Share capital reserve
68,250
-
Translation reserve
19
482,320
(93,993)
Retained deficit
(70,557,426)
(66,319,142)
Attributable to equity holders of the parent
(2,399,867)
316,896
Non-controlling interest
20
255,208
1,164,218
Total equity
(2,144,659)
1,481,114
Liabilities
Non-current liabilities
Lease liability
10
405,390
346,674
Other financial liabilities
22
444,365
243,056
Total non-current liabilities
849,755
589,730
Current liabilities
Lease liability
10
4,205
3,980
Trade and other payables
21
3,912,223
2,395,090
Borrowings
22
1,217,913
1,195,239
Other financial liabilities
22
318,925
1,012,790
Total current liabilities
5,453,266
4,607,099
Total liabilities
6,303,021
5,196,829
Total equity and liabilities
4,158,362
6,677,943
The accompanying notes on pages 57-91 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 20 December 2024 and signed on its behalf by:
On behalf of the Board
_____________________________
________________________
Cobus van der Merwe
Noel O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
38
All figures are stated in Sterling
31
December
2023
31
December
2022
Audited
Audited
Notes
£
£
Revenue
-
-
Administrative expenses
(316,557)
(804,820)
Listing and capital raising fees
(345,618)
(230,920)
Impairment of subsidiary investments
23
(3,328,031)
(12,333,224)
Fair value adjustment
23
24,037
(427,819)
Operating loss
(3,966,169)
(13,796,783)
Other income
3
89,937
16,266
Finance costs
4
(115,397)
(151,375)
Loss before tax
5
(3,991,629)
(13,931,892)
Taxation
8
-
-
Loss for the period
(3,991,629)
(13,931,892)
All activities derive from continuing operations.
The Company has no recognised gains or losses other than those dealt with in the Statement of Profit or Loss and
Other Comprehensive Income.
The accompanying notes on pages 57-91 form an integral part of these financial statements.
The financial statements were approved and authorised for issue by the Board of Directors on 20 December 2024
and signed on its behalf by:
On behalf of the Board
________________________
________________________
Cobus van der Merwe
Noel.O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
COMPANY STATEMENT OF FINANCIAL POSITION
39
All figures are stated in Sterling
31 December
2023
31 December
2022
Audited
Audited
Notes
£
£
Non-current Assets
Investments
23
2,335,641
5,688,607
Property, plant and equipment
10
1,012
1,265
Total non-current assets
2,336,653
5,689,872
Current assets
Other receivables
14
156,114
90,720
Cash and cash equivalents
15
1,507
19,442
Total current assets
157,621
110,162
Total assets
2,494,274
5,800,034
Equity and liabilities
Equity
Called up share capital
16
21,790,988
21,140,481
Share premium account
16
45,816,001
45,516,081
Share based payment reserve
18
-
73,469
Share capital reserve
68,250
-
Retained deficit
(67,501,103)
(63,609,256)
Total equity
174,136
3,120,775
Liabilities
Current liabilities
Trade and other payables
21
1,102,225
826,035
Borrowings
22
1,217,913
1,195,239
Other financial liabilities
22
-
657,985
Total current liabilities
2,320,138
2,679,259
Total liabilities
2,320,138
2,679,259
Total equity and liabilities
2,494,274
5,800,034
The accompanying notes on pages 57-91 form integral part of these financial statements.
The financial statements were approved by the Board of Directors on 20 December 2024 and signed on its behalf by:
On behalf of the Board
______________________________
________________________
Cobus van der Merwe
Noel O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
40
Share
Capital
Share
premium
Warrants
and share
based
payment
reserve
Warrant
and share
capital
reserve
Control
reserve
Translation
reserve
Retained
deficit
Non-
controlling
interest
Total equity
All figures are stated in Sterling
£
£
£
£
£
£
£
£
£
Balance as at 1 January 2022
21,042,444
45,429,328
466,868
-
-
(466,184)
(56,627,389)
1,962,816
11,807,883
Loss for the year
-
-
-
-
-
-
(9,776,917)
(1,131,607)
(10,908,524)
Other comprehensive income – exchange differences
-
-
-
-
-
372,191
-
-
372,191
Change in shareholding without loss of control
-
-
-
-
-
-
(333,009)
333,009
-
Shares issued
98,037
86,753
-
-
-
-
-
184,790
Warrants issued by Kibo Energy PLC during the year
-
-
24,774
-
-
-
-
-
24,774
Warrants issued by Kibo Energy PLC which expired
during the year
-
-
(418,173)
-
-
-
418,173
-
-
Balance as at 31 December 2022
21,140,481
45,516,081
73,469
-
-
(93,993)
(66,319,142)
1,164,218
1,481,114
Loss for the year
-
-
-
-
-
-
(3,854,280)
(1,861,061)
(5,715,341)
Other comprehensive income – exchange differences
-
-
-
-
-
576,313
-
6,195
582,508
Change in shareholding without loss of control
(483,786)
483,786
-
Shares issued
650,507
299,920
-
-
-
-
-
-
950,427
Outstanding warrants repriced
-
-
(45,850)
-
-
-
45,850
-
-
Directors loan repayable in shares
-
-
-
-
-
81,329
81,329
Warrants issued by Mast Energy Development PLC
-
-
-
-
-
-
-
380,741
380,741
Warrants issued by Kibo Energy PLC which were
exercised during the year pending settlement
-
-
-
68,250
-
-
-
-
68,250
Warrants issued by Kibo Energy PLC which were
exercised during the year
-
-
(10,178)
-
-
-
10,178
-
-
Warrants expired during the year
(17,441)
43,754
26,313
Balance as at 31 December 2023
21,790,988
45,816,001
-
68,250
-
482,320
(70,557,426)
255,208
(2,144,659)
Notes
16
16
18
17
19
20
The warrant and share capital reserves represent irrevocably exercised equity instruments which require issuance of shares.
The notes on pages 57-91 form part of the financial statements. The financial statements were approved by the Board of Directors on 20 December 2024 and signed on its behalf by:
On behalf of the Board
________________________________
________________________
Cobus van der Merwe
Noel O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
COMPANY STATEMENT OF CHANGES IN EQUITY
41
Share
capital
Share
premium
Share
capital
reserve
Share
based
payment
reserve
Retained
deficit
Total equity
All figures are stated in Sterling
£
£
£
£
£
£
Balance as at 1 January 2022
21,042,444
45,429,328
-
466,868
(50,095,537)
16,843,103
Loss for the year
-
-
-
-
(13,931,892)
(13,931,892)
Shares issued
98,037
86,753
-
-
-
184,790
Warrants issued by Kibo Energy PLC during the year
-
-
-
24,774
-
24,774
Warrants issued by Kibo Energy PLC which expired during the year
-
-
-
(418,173)
418,173
-
-
Balance as at 31 December 2022
21,140,481
45,516,081
-
73,469
(63,609,256)
3,120,775
Loss for the year
-
-
-
-
(3,991,629)
(3,991,629)
Shares issued
650,507
299,920
-
-
-
950,427
Outstanding warrants repriced
-
-
-
(45,850)
45,850
-
Warrants issued which were exercised during the year pending settlement
-
-
68,250
-
-
68,250
Warrants issued which were exercised during the year
-
-
-
(10,178)
10,178
-
Warrants expired during the year
-
-
-
(17,441)
43,754
26,313
Balance as at 31 December 2023
21,790,988
45,816,001
68,250
-
(67,501,103)
174,136
Notes
16
16
18
The accompanying notes on pages 57-91 form an integral part of these financial statements.
The financial statements were approved by the Board of Directors on 20 December 2024 and signed on its behalf by:
On behalf of the Board
_____________________________
________________________
Cobus van der Merwe
Noel O’Keeffe
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
CONSOLIDATED STATEMENT OF CASH FLOWS
42
All figures are stated in Sterling
31
December
2023
31
December
2022
Audited
Audited
Notes
£
£
Cash flows from operating activities
Loss for the period before taxation
(5,715,341)
(10,908,524)
Adjustments for:
(Reversal of) / Impairment of associates
12
(429,102)
3,809,775
Costs settled through the issue of shares
19,635
95,001
Depreciation on property, plant and equipment
10
75,023
66,582
Directors’ fees settled with credit loan notes
-
44,591
(Losses)/Gains on revaluations of derivatives
86,558
(86,558)
Impairment of intangible assets
11
2,258,774
3,229,155
Impairment of property, plant and equipment
10
459,700
-
Interest accrued
204,128
248,202
Loss from equity accounted associate
97,340
181,684
Loan reprofiling costs not settled in cash
195,559
-
Other non-cashflow items
3,698
133
Profit on sale of property, plant and equipment
(6,424)
(7,264)
Warrants and options issued
422,100
24,774
(2,328,352)
(3,302,449)
Movement in working capital
Decrease / (Increase) in debtors
14
(15,049)
28,524
Increase / (Decrease) in creditors
21
1,517,133
678,817
1,502,084
707,341
Net cash outflows from operating activities
(826,268)
(2,595,108)
Cash flows from financing activities
Repayment of lease liabilities
(39,292)
(27,000)
Repayment of borrowings
(466,870)
(44,917)
Proceeds from borrowings
85,800
2,322,824
Proceeds from director’s loan
81,329
-
Proceeds from disposal of interests in subsidiary to non-controlling
interest without loss of control
482,966
-
Net cash (used in) / proceeds from financing activities
143,933
2,250,907
Cash flows from investing activities
Cash received from /(advanced) to Joint Venture
-
20,955
Property, plant and equipment acquired (excluding right of use assets)
-
(1,020,747)
Intangible assets acquired
-
(342,038)
Deferred payment settlement
-
(555,535)
Net cash flows from/(used in) investing activities
-
(1,897,365)
Net (decrease) / increase in cash
(682,335)
(2,241,566)
Cash at beginning of period
163,884
2,082,906
Exchange movement
582,508
322,544
Cash at end of the period
15
64,057
163,884
The accompanying notes pages 57-91 form an integral part of these financial statements.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
COMPANY STATEMENT OF CASH FLOWS
43
All figures are stated in Sterling
31 December
2023
31 December
2022
Audited
Audited
Notes
£
£
Cash flows from operating activities
(Loss) for the period before taxation
Adjusted for:
(3,991,629)
(13,931,892)
Depreciation
253
-
Fair value adjustment of investment in associates
23
(24,037)
406,863
Warrants and options issued
99,782
24,774
Interest accrued
115,397
151,377
Impairment of investments
23
3,328,031
12,354,180
Expenses settled in shares
166,244
95,001
Directors’ fees settled with credit loan notes
-
44,591
Other non-cash items
3,084
134
(302,875)
(854,972)
Movement in working capital
(Increase) in debtors
14
(65,394)
(16,986)
Increase in creditors
21
276,190
111,973
210,796
94,987
Net cash outflows from operating activities
(92,079)
(759,985)
Cash flows from financing activities
Proceeds from borrowings
22
317,039
1,672,824
Repayment of borrowings
22
(322,687)
(44,917)
Net cash (outflows) / inflows from financing activities
(5,648)
1,627,907
Cash flows from investing activities
Cash advances to Group Companies
(359,093)
(1,086,889)
Repayments of advances from group companies
438,885
-
Purchase of Property, Plant and Equipment
10
(1,265)
Net cash generated from/(used in) investing activities
79,792
(1,088,154)
Net (decrease) in cash
(17,395)
(220,232)
Cash at beginning of period
19,442
239,674
Cash at end of the period
15
1,507
19,442
The accompanying notes on pages 57-91 form an integral part of these financial statements.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
44
General Information
Kibo Energy PLC (“the Company”) is a Company incorporated in Ireland at registered office 17 Pembroke Street Upper
Dublin 2, Ireland. The Company’s ordinary shares are admitted to trading on the AIM Market of the London Stock
Exchange. The Group financial statements consolidate those of the Company and its subsidiaries (together referred
to as the “Group”).
The principal activities of the Company and its subsidiaries are related to the exploration for and development of
multi-asset energy projects in Sub Saharan Africa, and the United Kingdom.
Statement of Compliance
As required by AIM rules and permitted by Company Law, the Group financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS) and their interpretations issued by the
International Accounting Standards Board (IASB) as adopted by the EU (IFRS).
The IFRS adopted by the EU as applied by the Company and the Group in the preparation of these financial statements
are those that were effective for accounting periods commencing on or before 1 January 2023 or were early adopted
as indicated elsewhere in these accounting policies.
The financial statements have been prepared in accordance with the requirements of the Companies Act 2014.
Statement of Accounting Policies
The accounting policies set out below have been applied consistently to all periods presented in these consolidated
financial statements in the current financial period.
Basis of Preparation
The Group and Company financial statements are prepared on the historical cost basis less accumulated impairments,
except for the investment in Katoro Gold PLC which is measured at fair value by the Company. The accounting policies
have been applied consistently by Group entities, except for the adoption of new standards and interpretations which
became effective in the current year. The Group and Company financial statements have been prepared on a going
concern basis as explained in the notes to the financial statements.
The individual financial information of each Group entity is measured and presented in the currency of the primary
economic environment in which the entity operates (its functional currency). The consolidated financial information
of the Group is presented in Pounds Sterling, which is the presentation currency for the Group. The functional
currency of each of the Group entities is the local currency of each individual entity.
Going Concern
The financial statements have been prepared on the going concern basis which contemplates the continuity of normal
business activities and the realisation of assets and the settlement of liabilities in the normal course of business. In
performing the going concern assessment, the Board considered various factors, including the availability of cash and
cash equivalents; data relating to working capital requirements for the foreseeable future; cash-flows from
operational commencement, available information about the future, the possible outcomes of planned events, changes
in future conditions, the current global economic situation due to the ongoing Ukraine and Israel and Gaza conflicts,
and the responses to such events and conditions that would be available to the Board.
The Board has, inter alia, considered the following specific factors in determining whether the Group is a going
concern:
•
The significant financial loss for the year amounting to £5,715,341 (2022: £10,908,524);
•
Cash and cash equivalents readily available to the Group in the amount of £64,057 in order to pay its creditors
and maturing liabilities in the amount of £5,453,266 as and when they fall due and meet its operating costs for
the ensuing twelve months (2022: £163,884 and £4,192,170 respectively);
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
45
•
Whether the Group has available cash resources, or equivalent short term funding opportunities in the
foreseeable future, to deploy in developing and growing existing operations or invest in new opportunities;
and
•
Investment and associated funding opportunities available to the company after disposal of its Cyprus
subsidiary, Kibo Mining (Cyprus) Limited effective on 11 October as disclosed in note 26 (the “KMCL Disposal”),
following which the Company became an AIM Rule 15 cash shell. Given the Company’s limited available cash
resources post the KMCL Disposal and considering the Company’s status as a cash shell, the Board is
considering various investment opportunities to acquire a portfolio of assets as part of a Reverse Takeover
transaction (“RTO”) as envisaged under the AIM Rules which will coincide with a substantial fundraise to
provide the Company with sufficient working capital to meet its overhead and project development
commitments post RTO.
Following from the losses incurred in the current financial period, coupled with the net current liability position the
Group finds itself in as at December 2023, these conditions, together with those mentioned above are considered to
indicate that a material uncertainty exists which may cast significant doubt on the Group’s ability to continue as a
going concern.
This is largely attributable to the short-term liquidity position the Group finds itself in as a result of the significant
capital required to meet its obligations that exceeds cash contributed to the Group by the capital contributors. The
Directors have evaluated the Group’s liquidity requirements to confirm whether the Group has adequate cash
resources to continue as a going concern for the foreseeable future, taking into account the net current liability
position, and consequently prepared a cash flow forecast covering a period of 12 months from the date of approval of
these financial statements, concluding that the Group would be able to continue its operations as a going concern.
In response to the net current liability position, to address future cash flow requirements, detailed liquidity
improvement initiatives have been identified and are being pursued, with their implementation regularly monitored
in order to ensure the Group is able to alleviate the liquidity constraints in the foreseeable future. Therefore, the ability
of the Group to continue as a going concern is dependent on the successful implementation or conclusion of the below
noted matters in order to address the liquidity risk the Group faces on an ongoing basis:
•
Successful conclusion of funding initiatives of the Group in order to keep the Company in good standing until
the successful completion of a reverse takeover transaction as the Company pursues its objective to acquire
a new portfolio of assets; and
•
Successful completion of a reverse takeover transaction as required under AIM Rule 15 given that the
Company became a cash shell on 11 October 2024 with the disposal of its subsidiary, Kibo Mining (Cyprus)
Limited.
Further to the above, on 3 December 2024 the Company announced that it had secured a loan facility for up to £500,000
from Aria Capital Management Limited (“Aria”) (the “Aria Facility”). The Company has received the first payment totalling
£122,585 under the Aria Facility. The purpose of the Aria Facility is to provide the Company with working capital until
it is able to identify and complete a reverse takeover transaction. Aria has also provided the Company with written
confirmation, which is effective for a period until 31 December 2025, that it will support the Company in its capacity
as lender under the Aria Facility and advisor to the Company, as follows:
•
Assist the Company in the timely sourcing and procurement of an appropriate project portfolio as part a
reverse takeover transaction;
•
Assist the Company to raise appropriate funding to the Company in good standing until completion of a
reverse takeover transaction to enable the Company to continue as a going concern for the foreseeable future;
and
•
Aria will not recall or demand cash repayment of the Aria Facility provided to the Company, except insofar as
the funds of the Company permit repayment and that such repayment will not adversely affect the ability of
the Company to carry on its business operations as a going concern.
As the Board is confident it would be able to successfully implement the above matters, it has adopted the going
concern basis of accounting in preparing the consolidated financial statements.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
46
Use of Estimates and Judgements
The preparation of financial statements in conformity with EU IFRS requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
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 judgements about
carrying values of assets and liabilities that are not readily apparent from other sources.
In particular, there are significant areas of estimation, uncertainty and critical judgements in applying accounting
policies that have the most significant effect on the amounts recognised in the financial statements.
The following key areas of estimation uncertainty exist:
•
significant estimation uncertainty inherent in determination of the recoverable amount as part of the
impairment assessment of non-financial assets, which include amongst others intangible assets related to
mining rights and exploration licences as well as tangible assets in the form of property, plant or equipment;
•
estimation uncertainty inherent in determination of the period of the useful life of Tangible and Intangible
assets;
•
estimation uncertainty inherent in determination of the incremental borrowing rate of leases;
•
estimation uncertainty inherent in the fair value determination of investment in unlisted associates;
•
estimation uncertainty in the valuation of share-based instruments in issue; and
•
estimation uncertainty inherent in the determination of credit loss allowance for other financial assets.
The following key areas of judgement exist:
•
Recognition and measurement of exploration and evaluation expenditure;
•
Fair value determination of unlisted investments measured at fair value through profit or loss;
•
Consolidation of Joint Venture interest;
•
Consolidation of Subsidiary interest;
•
Consolidation of Associate interest; and
•
Going concern.
Significant estimation uncertainty inherent in determination of the recoverable amount as part of the
impairment assessment of non-financial assets, which include amongst others intangible assets related to
mining rights and exploration licences, associate investments as well as tangible assets in the form of property,
plant or equipment
In applying IAS 36, impairment assessments are performed whenever events or changes in circumstances indicate
that the carrying amount of an asset or CGU may not be recoverable, over and above the annual impairment
assessment required for goodwill and intangible assets which have an indefinite useful live. Estimates are made in
determining the recoverable amount of assets which includes the estimation of cash flows and discount rates used. In
estimating the cash flows, management bases cash flow projections on reasonable and supportable assumptions that
represent management’s best estimate of the range of economic conditions that will exist over the remaining useful
life of the assets. The discount rates used reflect the current market assessment of the time value of money and the
risks specific to the assets for which the future cash flow estimates have not been adjusted. Where the value in use
basis to determine the recoverable amount is not considered appropriate the recoverable amount is based on fair
market value, which is determined by identifying recent completed sales transactions or valuations for similar
commodity projects, in similar condition and with similar stage of development to utilise as base from which to
quantify the proposed fair value at which an independent third party may be willing to acquire the assets.
Estimation uncertainty inherent in determination of the period of the useful life of Tangible and Intangible
assets
Depreciation “(Amortisation for intangible assets”) is charged on a systematic basis over the estimated useful lives of
the assets after taking into account the estimated residual values of the assets. In determining the depreciable amount,
management makes assumptions in respect of the residual value of assets based on the expected estimated amount
that the entity would currently obtain from disposing the asset, after deducting the estimated costs of disposal. If an
asset is expected to be abandoned, the residual value is estimated at nil. Useful live is either the period of time over
which the asset is expected to be used or the number of production or similar units expected to be obtained from the
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
47
use of the asset, taking into account the expected physical wear and tear, legal or similar limits of assets such as rights,
condition and location of the asset as well as obsolescence.
Estimation uncertainty inherent in determination of the incremental borrowing rate of leases
The Group cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing
rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow over
a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use
asset in a similar economic environment. The IBR therefore reflects what the Group ‘would have to pay’, which
requires estimation when no observable rates are available or when they need to be adjusted to reflect the terms and
conditions of the lease. The Group estimates the IBR using observable inputs (such as market interest rates) when
available and is required to make certain entity-specific estimates.
Estimation uncertainty inherent in the fair value determination of investment in unlisted associates
Following the disposal of the controlling interest held in Mabesekwa Coal during the prior financial period, the
remaining interest in the Mabesekwa Coal indicated the existence of significant influence, thus the remaining equity
investment is recognised as an investment in associate where its cost at initial recognition is equal to the fair value
determined on loss of control. The principal asset held by Mabesekwa Coal comprises a pending mining licence for a
prospective coal asset and coal resources where previous work had identified an indicative resource. The asset is
considered to be unique, and a fair market price is not easily obtainable. The overall value of the investment in
associate, however, was separately reviewed by the independent directors, as announced to the market on various
occasions, which is the basis utilised for the valuation of the associate on loss of control.
Estimation uncertainty in the valuation of share-based instruments in issue
Share-based instruments issued, such as warrants or options, or payments made require significant judgment and
estimate concerning the method of valuation applied and key inputs applied respectively. In order to calculate the
charge for share based warrants issued or payments as required by IFRS 9 and IFRS 2 respectively, the Group makes
estimates principally relating to the assumptions used in its option-pricing model. Refer to Note 18 for details on
valuation of share-based transactions, including options and warrants granted.
Estimation uncertainty inherent in the determination of credit loss allowance for other financial assets
Lake Victoria Gold
The continued default from the counterparty resulted in the credit risk increasing significantly during the period to
lifetime expected credit losses for the financial asset receivable. With effect from 30 September 2021, the Group lost
control over its net investment in Katoro Gold PLC, following which the financial asset receivable was de-recognised.
Blyvoor Joint Venture
The Blyvoor joint operation agreement has been structured in such a way that all amounts contributed to the joint
operations by Katoro is receivable from the Blyvoor joint operation once the project reaches commercial viability and
starts generating positive cashflow to pay firstly the third-party creditors and thereafter Katoro capital contributed
to the joint operations. The credit loss allowance for the Blyvoor Joint Venture Receivable as disclosed in Note 12 was
determined to be equal to a lifetime expected credit loss allowance following from the uncertainty related to the
commercial viability of the underlying project as at reporting period date The uncertainty around the successful
achievement of commercial viability of the project as at this point in time results in the increased credit risk to lifetime
expected credit losses for the financial asset receivable. With effect from 30 September 2021, the Group lost control
over its net investment in Katoro Gold PLC, following which the financial asset receivable was de-recognised.
Significant judgement concerning the choice of accounting policy w.r.t exploration and evaluation expenditure
In line with the Group’s accounting policy, all the exploration and evaluation expenditure has been charged to profit
or loss, as in the judgement of the Directors the commercial viability of the mineral deposits had not been established.
If a policy of capitalisation of exploration expenditure had been adopted an amount of £326,093 would have been
capitalised in the current year (2022: £847,567).
Significant judgement relating to the consolidation of Joint Venture interest
In the 2018 year Kibo entered into a Joint Venture Agreement (“JV”) acquiring a 65% equity interest in the Benga
Power Plant Project (“BPPP”). Although the agreement refers to the existence of a 65% equity stake, and Kibo’s ability
to appoint three of five management committee members, all decisions presented in front of the management
committee requires absolute agreement by all committee members before it stands, failing which it would result in a
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
48
decision to be made between the two respective CEOs of the participating entities in the JV. Furthermore, the
participating interest only allows to partake in the net revenue of the JV.
Significant judgement relating to the consolidation of Subsidiary interest
In the current year Kibo’s effective equity interest in Mast Energy Developments PLC (“MED”) was 42.58% as at 31
December 2023 (2022: 57.86%). MED is recognised as a subsidiary and is measured in accordance with the business
combinations as prescribed by IFRS 3.
During the current year the shareholding in MED was reduced to below 50%. Judgement was applied on continued
recognition of MED as a subsidiary based on factors other than shareholding above 50%. These judgements take into
account the board composition of MED, Kibo’s voting bloc in relation to other investors and significant intercompany
loans at the reporting date with historic precedent of conversion to share equity. These factors satisfy the
requirements of IFRS 10 (Consolidated Financial Statements) in relation to control, and Kibo’s continued
consolidation of MED.
Significant judgement relating to the consolidation of Associate interest
In the current year Kibo’s effective equity interest in Katoro Gold PLC (“Katoro”) was 14.36% as at 31 December 2023
(2022: 20.88%). Katoro Gold PLC is recognised as an associate and is measured in accordance with the equity method
as prescribed by IAS 28.
During the current year the shareholding of Katoro declined to below 20%. The recognition of Katoro Plc and its
subsidiaries as an associate were based on factors other than shareholding. These judgements take into account the
board composition of Katoro Gold Plc which indicated significant influence at the reporting date.
Significant judgement relating to the adoption of the Going Concern basis of preparation
The Group’s current liabilities exceed its current assets as at 31 December 2023 which contributes significantly to the
material uncertainty related to the going concern assumption applied in preparation of the financial statements.
Management applies judgement in determining whether or not the Group is able to continue as a going concern for
the foreseeable future, in identifying the matters which give rise to the existence of the material uncertainty, and in
developing responses thereto in order to address the risk of material uncertainty.
Consolidation
The consolidated annual financial statements comprise the financial statements of Kibo and its subsidiaries for the
year ended 31 December 2023 over which the Company has control.
Control is achieved when the Company:
•
has the power over the investee;
•
is exposed, or has rights, to variable return from its involvement with the investee; and
•
has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstance indicate that there are
changes to one or more of the three elements of control listed above.
De-facto control exists in situations where the Company has the practical ability to direct the relevant activities of the
investee without holding the majority of the voting rights.
In determining whether de-facto control exists the Company considers all relevant facts and circumstances, including:
•
The size of the Company’s voting rights relative to both the size and dispersion of other parties who hold
voting rights;
•
Substantive potential voting rights held by the company and by other parties;
•
Other contractual arrangements; and
•
Historic patterns in voting attendance.
In assessing control, potential voting rights that are currently exercisable or convertible are taken into account.
Subsidiaries are fully consolidated from the date that control commences until the date that control ceases.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies
adopted by the Group.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
49
Intragroup balances and any unrealised gains or losses or income or expenses arising from intragroup transactions
are eliminated in preparing the Group financial statements, except to the extent they provide evidence of impairment.
The Group accounts for business combinations using the acquisition method of accounting. The cost of the business
combination is measured as the aggregate of the fair values of assets given, liabilities incurred or assumed, and equity
instruments issued. Costs directly attributable to the business combination are expensed as incurred, except the costs
to issue debt which are amortised as part of the effective interest and costs to issue equity which are included in
equity.
The acquiree's identifiable assets, liabilities and contingent liabilities which meet the recognition conditions of IFRS
3 Business Combinations are recognised at their fair values at acquisition date.
Contingent liabilities are only included in the identifiable assets and liabilities of the acquiree where there is a present
obligation at acquisition date.
Non-controlling interest arising from a business combination is measured either at their share of the fair value of the
assets and liabilities of the acquiree or at fair value. The treatment is not an accounting policy choice but is selected
for each individual business combination and disclosed in the note for business combinations.
Changes in the Group’s interest in subsidiaries that do not result in a loss of control are accounted for as equity
transactions.
Upon the loss of control, the Company derecognises the assets and liabilities of the subsidiary, any non-controlling
interests and the other components of equity related to the subsidiary. Any resulting gain or loss is recognised in
profit or loss. If the Company retains any interest in the previous subsidiary, such interest is measured at fair value at
the date that control is lost.
Any gain from the acquisition of a subsidiary or gain/loss from the disposal of subsidiary will be recognised through
profit and loss in the current financial period.
Business combinations involving entities under common control
Business combinations involving entities under common control comprise business combinations where both entities
remain under the ultimate control of the holding company before and after the combination, and that control is not
transitory. The group applies merger accounting for all its common control transactions from the date that it obtains
control. In terms of this:
•
the assets and liabilities of the acquiree are recorded at their existing carrying amounts (not fair value);
•
if necessary, adjustments are made to achieve uniform accounting policies;
•
intangible assets and contingent liabilities are recognised only to the extent that they were recognised by the
acquiree in accordance with applicable IFRS;
•
no goodwill is recognised. Any difference between the acquirer’s cost of investment and the acquiree’s equity
is presented separately directly in equity as a common control reserve (CCR) on consolidation;
•
any non-controlling interest is measured as a proportionate share of the carrying amounts of the related
assets and liabilities (as adjusted to achieve uniform accounting policies); and
•
any expenses of the combination are written off immediately in profit or loss, except for the costs to issue
debt which are amortised as part of the effective interest and costs to issue equity which are recognised
within equity.
When control is lost, resulting in the common control of entities, the balance of CCR recognised in respect of that
acquisition is realised directly to retained earnings on the effective date when control is lost.
Intangible Assets
Intangible assets acquired separately
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation
and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimated useful
lives which are disclosed in Note 11. The estimated useful life and amortisation method are reviewed at the end of
each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
50
Intangible assets with an indefinite useful life
An intangible asset is regarded as having an indefinite useful life when, based on all relevant factors, there is no
foreseeable limit to the period over which the asset is expected to generate net cash inflows. Amortisation is not
provided for these intangible assets, but they are tested for impairment annually or more frequently if events or
changes in circumstances indicate that the carrying value may be impaired, and it is subsequently carried at cost less
accumulated impairment losses.
Derecognition of intangible assets
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or
disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the
net disposal proceeds and the carrying amount of the asset, are recognised in profit or loss when the asset is
derecognised.
Categories of intangible assets
Intangible assets comprise the following:
•
acquisition of rights to explore or mine in relation to the Group’s exploration and evaluation activities; and
•
intellectual property acquired in relation to the Group’s renewable energy activities.
Irrespective of whether there is any indication of impairment, the Group also tests intangible assets not yet available
for use for impairment annually by comparing its carrying amount with its recoverable amount. This impairment
test is performed during the annual period and at the same time every period.
Investments in associates
Associates are all entities over which the group has significant influence but not control, generally accompanying a
shareholding between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity
method of accounting.
Under the equity method, the investment is initially recognised at cost where the equity interest in the associate is
acquired, however where control is lost over a subsidiary the remaining equity interest is recognised at fair value on
date which control is lost and the fair value is deemed to be the cost of the investment in associate going forward and
the carrying amount is increased or decreased to recognise the investor’s share of the profit or loss of the investee
after the date of acquisition.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of
the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.
The group’s share of post-acquisition profit or loss is recognised in the statement of profit or loss, and its share of
post-acquisition movements in other comprehensive income is recognised in other comprehensive income with a
corresponding adjustment to the carrying amount of the investment. When the group’s share of losses in an associate
equal or exceeds its interest in the associate, including any other unsecured receivables, the group does not recognise
further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.
The group determines at each reporting date whether there is any objective evidence that the investment in the
associate is impaired. If this is the case, the group calculates the amount of the impairment as the difference between
the recoverable amount of the associate and its carrying value and recognises the amount adjacent to share of
profit/(loss) of associates in the statement of comprehensive income.
Exploration & Evaluation Assets
Exploration and evaluation activity involves the search for mineral resources, the determination of technical
feasibility and the assessment of commercial viability of an identified resource. Exploration and evaluation activity
includes:
•
researching and analysing historical exploration data;
•
gathering exploration data through topographical, geochemical and geophysical studies;
•
exploratory drilling, trenching and sampling;
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SUMMARY OF MATERIAL ACCOUNTING POLICIES
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•
determining and examining the volume and grade of the resource;
•
surveying transportation and infrastructure requirements; and
•
conducting market and finance studies.
Exploration and evaluation expenditure is charged to the Statement of Profit or Loss as incurred except in the
following circumstances, in which case the expenditure may be capitalised:
In respect of minerals activities:
•
the exploration and evaluation activity are within an area of interest which was previously acquired as an
asset acquisition or in a business combination and measured at fair value on acquisition; or
•
the existence of a commercially viable mineral deposit has been established.
Capitalised exploration and evaluation expenditure considered to be tangible is recorded as a component of property,
plant and equipment at cost less impairment charges. Otherwise, it is recorded as an intangible.
Intangible assets all relate to exploration and evaluation expenditure which are carried at cost with an indefinite
useful life and therefore are reviewed for impairment annually and when there are indicators of impairment. Where
a potential impairment is indicated, assessment is performed for each area of interest in conjunction with the group
of operating assets (representing a cash generating unit) to which the exploration is attributed. Exploration areas at
which reserves have been discovered but require major capital expenditure before production can begin, are
continually evaluated to ensure that commercial quantities of reserves exist or to ensure that additional exploration
work is under way or planned.
Impairment
Non-financial assets
Assets are reviewed for impairment at each reporting date or whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the
asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of
assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows
(cash generating units).
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is
recognised in the Statement of Profit or Loss immediately.
Property, Plant and Equipment
Property, Plant and Equipment is stated at cost, less accumulated depreciation.
Cost includes expenditure that is directly attributable to the acquisition of the items of property, plant and equipment.
The cost of self-constructed items of property, plant and equipment includes the cost of materials and direct labour,
any other costs directly attributable to bringing the items of property, plant and equipment to a working condition
for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are
located.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate
items (major components) of property, plant and equipment.
Depreciation is provided at rates calculated to write off the cost less residual value of each asset over its expected
useful life, as follows:
•
Land is not depreciated;
•
Office equipment between 12.5% to 37.5% straight line;
•
Plant & machinery at 20% straight line;
•
Furniture & fixtures at 12.5% straight line;
•
Motor vehicles at 25% straight line;
•
Right of Use assets straight line over the lease term; and
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SUMMARY OF MATERIAL ACCOUNTING POLICIES
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•
I.T. Equipment at 20% straight line
Depreciation methods, useful lives and residual values are reviewed at each reporting date. Useful lives are affected
by technology innovations, maintenance programmes and future economic benefits. Residual value assessments
consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
On disposal of property, plant and equipment the cost and the related accumulated depreciation and impairments are
removed from the financial statements and the net amount, less any proceeds, is taken to the Statement of Profit or
Loss and Other Comprehensive Income.
Right-of-use assets and corresponding lease liability
For any new contracts entered into the Group considers whether a contract is or contains a lease. A lease is defined
as ‘a contract, or part of a contract, that conveys the right to use an asset (the underlying asset) for a period of time in
exchange for consideration’. To apply this definition the Group assesses whether the contract meets three key
evaluations which are whether:
•
the contract contains an identified asset, which is either explicitly identified in the contract or implicitly
specified by being identified at the time the asset is made available to the Group.
•
the Group has the right to obtain substantially all of the economic benefits from use of the identified asset
throughout the period of use, considering its rights within the defined scope of the contract
the Group has the right to direct the use of the identified asset throughout the period of use. The Group assess whether
it has the right to direct ‘how and for what purpose’ the asset is used throughout the period of use.
At lease commencement date, the group recognises a right-of-use asset and a lease liability on the statement of
financial position. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease
liability, any initial direct costs incurred by the group, and any lease payments made in advance of the lease
commencement date. The group depreciates the right-of-use assets on a straight-line basis from the lease
commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term
whichever is earlier. The group also assesses the right-of-use asset for impairment when such indicators exist. At the
commencement date, the group measures the lease liability at the present value of the lease payments unpaid at that
date, discounted using the interest rate implicit in the lease if that rate is readily available or the group’s incremental
borrowing rate. In determining the present value of the lease liability, the group has used its incremental borrowing
rate of prime as the rate implicit in the lease was not readily available. Lease payments included in the measurement
of the lease liability are made up of fixed payments (including in substance fixed), variable payments based on an
index or rate, amounts expected to be payable under a residual value guarantee and payments arising from options
reasonably certain to be exercised.
Subsequent to initial measurement, the liability will be reduced for payments made and increased for interest. It is
remeasured to reflect any reassessment or modification, or if there are changes in in-substance fixed payments. When
the lease liability is remeasured, the corresponding adjustment is reflected in the right-of-use asset, or profit and loss
if the right-of-use asset is already reduced to zero.
The group has elected to account for short-term leases and leases of low-value assets using the practical expedients.
Instead of recognising a right-of-use asset and lease liability, the payments in relation to these are recognised as an
expense in profit or loss on a straight-line basis over the lease term.
On the statement of financial position, right-of-use assets have been included in property, plant and equipment and
lease liabilities have been included in trade payables.
Income Tax
Income tax expense comprises current and deferred tax. Income tax expense is recognised in the Income Statement
except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively
enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill, the initial
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SUMMARY OF MATERIAL ACCOUNTING POLICIES
53
recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they probably
will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to
the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by
the reporting date.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against
which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced
to the extent that it is no longer probable that the related tax benefit will be realised.
Employee benefits
Short-term benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related
service is provided.
A liability is recognised for the amount expected to be paid under short-term cash bonuses or profit-sharing plans if
the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by
the employee and the obligation can be estimated reliably.
Foreign Currencies
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (“the functional currency”). The consolidated annual
financial statements are presented in Sterling, which is the Group’s presentation currency. This is also the functional
currency of the Company and is considered by the Board also to be appropriate for the purposes of preparing the
Group financial statements.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and
from the translation at period end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in the Statement of Profit or Loss.
Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary
economy) that have a functional currency different from the presentation currency are translated into the
presentation currency as follows:
•
monetary assets and liabilities for each Statement of Financial Position presented are presented at the closing
rate at the date of that Statement of Financial Position. Non-monetary items are measured at the exchange
rate in effect at the historical transaction date and are not translated at each Statement of Financial Position
date;
•
income and expenses for each Statement of Profit or Loss are translated at average exchange rates (unless
this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the dates of the transaction): and
•
all resulting exchange differences are recognised as a separate component of equity. On consolidation,
exchange differences arising from the translation of monetary items receivable from foreign subsidiaries for
which settlement is neither planned nor likely to occur in the foreseeable future are taken to shareholders
equity. When a foreign operation is sold, such exchange differences are recognised in the Statement of Profit
or Loss as part of the gain or loss on sale.
Finance income and expense
Finance income comprises interest income on funds invested, dividend income, gains on the disposal of available-for-
sale financial assets, and changes in the fair value of financial assets at fair value through profit or loss. Interest income
is recognised as it accrues in profit or loss, using the effective interest method. Dividend income is recognised in profit
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
54
or loss on the date that the Group’s right to receive payment is established, which in the case of listed securities is the
ex-dividend date.
Finance expenses comprise interest expense on borrowings, unwinding of discount on provisions, changes in the fair
value of financial assets at fair value through profit or loss, impairment losses recognised on financial assets and losses
on forward exchange contracts that are recognised in profit or loss. All borrowing costs are recognised in profit or
loss using the effective interest method.
Foreign currency gains and losses are reported on a net basis.
Earnings per Share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by
dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of
ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable
to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all
dilutive potential ordinary shares.
Financial Instruments
Recognition
Financial instruments comprise other financial assets receivable, trade and other receivables, cash and cash
equivalents, trade and other payables, other financial liabilities and borrowings.
Financial assets and liabilities are recognised in the Group’s statement of financial position when the Group becomes
a party to the contractual provisions of the instruments.
Classification
The Group classifies financial assets on initial recognition as measured at amortised cost as the Group’s business
model and objective is to hold the financial asset in order to collect the contractual cash flow and the contractual terms
allows for cash flows on specified dates for the payment of the principal amounts outstanding.
Financial liabilities are classified at amortised cost.
Financial assets
Classification
Other financial assets
Financial assets at amortised cost
Trade and other receivables
Financial assets at amortised cost
Cash and Cash Equivalents
Financial assets at amortised cost
Investment in listed entities
Financial assets at fair value through profit or loss
Financial liabilities
Classification
Trade and other payables
Financial liabilities at amortised cost
Borrowings
Financial liabilities at amortised cost
Financial assets are classified as current if expected to be realised or settled within 12 months from the reporting
date; if not, they are classified as non-current. Financial liabilities are classified as non-current if the Group has an
unconditional right to defer payment for more than 12 months from the reporting date.
Measurement on Initial recognition
All financial assets and liabilities are initially measured at fair value, including transaction costs.
Subsequent measurement
Financial assets held at amortised cost are subsequently measured at amortised cost using the effective interest
method, less any impairment losses.
Foreign exchange gains and losses and impairments are recognised in profit or loss. Any gain or loss on de-recognition
is recognised in profit or loss.
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SUMMARY OF MATERIAL ACCOUNTING POLICIES
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Financial assets held at fair value through profit or loss are subsequently measured at fair value with fair value
movement recognised through profit or loss.
Financial liabilities are subsequently measured at amortised cost using the effective interest method.
De-recognition
Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been
transferred and the group has transferred substantially all risks and rewards of ownership.
Financial liabilities are derecognised when the obligations specified in the contracts are discharged, cancelled or
expire.
On de-recognition of a financial asset/liability, any difference between the carrying amount extinguished and the
consideration paid is recognised in profit or loss.
Impairment of Financial Assets not carried at Fair value
Under IFRS 9 the Group calculates its allowance for credit losses as expected credit losses (ECLs) for financial assets
measured at amortised cost. ECLs are a probability weighted estimate of credit losses.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between
its carrying amount, and the present value of the estimated future cash flows discounted at the original effective
interest rate.
Significant financial assets are tested for impairment on an individual basis. The remaining financial assets are
assessed collectively in Groups that share similar credit risk characteristics.
An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment
loss was recognised. For financial assets measured at amortised cost, the reversal is recognised in the profit or loss.
Warrant reserves
For such grants of share options or warrants qualifying as equity-settled share-based payments, the fair value as at
the date of grant is calculated using the Black-Scholes option pricing model, taking into account the terms and
conditions upon which the options or warrants were granted. The amount recognised as an expense is adjusted to
reflect the actual number of share options or warrants that are likely to vest, except where forfeiture is only due to
market-based conditions not achieving the threshold for vesting.
Share based payments
For such grants of share options qualifying as equity-settled share-based payments, the fair value as at the date of
grant is calculated using the Black-Scholes option pricing model, taking into account the terms and conditions upon
which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of
share options that are likely to vest, except where forfeiture is only due to market-based conditions not achieving the
threshold for vesting.
Share Capital
Incremental costs directly attributable to the issue of ordinary shares are recognised directly in equity.
Issue Expenses and Share Premium Account
Issue expenses directly attributable to the issuance of new ordinary shares are written off against the premium arising
on the issue of share capital where ordinary shares are issued at a premium. Where the ordinary shares are issued at
their nominal value, the issue expenses directly attributable to the issuance of new ordinary shares is set off against
the accumulated loss reserve.
Segment reporting
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
SUMMARY OF MATERIAL ACCOUNTING POLICIES
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The Group determines and presents operating segments based on the information that is internally provided to the
Chief Executive Officer, who is the chief operating decision maker. A segment is a distinguishable component of the
Group that is engaged either in providing related products or services (business segment), or in providing products
or services within a particular economic environment (geographical segment), which is subject to risks and returns
that are different from those of the other segments. The Group’s primary format for segment reporting is based on
business segments. The business segments are determined based on the reporting business units.
Joint arrangements
Joint arrangements are arrangements in which the Group shares joint control with one or more parties. Joint control
is the contractually agreed sharing of control of an arrangement and exists only when decisions about the activities
that significantly affect the arrangement’s returns require the unanimous consent of the parties sharing control.
Judgement is required in determining this classification through an evaluation of the facts and circumstances arising
from each individual arrangement. Joint arrangements are classified as either joint operations or joint ventures based
on the rights and obligations of the parties to the arrangement.
In joint operations, the parties have rights to the assets and obligations for the liabilities relating to the arrangement,
whereas in joint ventures, the parties have rights to the net assets of the arrangement. Joint arrangements that are
not structured through a separate vehicle are always joint operations. Joint arrangements that are structured through
a separate vehicle may be either joint operations or joint ventures depending on the substance of the arrangement. In
these cases, consideration is given to the legal form of the separate vehicle, the terms of the contractual arrangement
and, when relevant, other facts and circumstances. The Group accounts for joint operations by recognising the assets,
liabilities, revenue, and expenses for which it has rights or obligations, including its share of such items held or
incurred jointly.
Revenue from contracts with customers
The Group and Company recognise revenue from the following major source:
•
Provision of produced electricity generated from peaker power plants.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The transaction price is the amount of consideration to which the expects to be
entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf
of third parties and is variable.
The revenue is generated upon consumption by the customer and is recognised at a point in time based on the variable
consumption for the specific period for which the revenue is recognised.
Customers are invoiced on a monthly basis and consideration is payable when invoiced.
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
57
NEW STANDARDS AND INTERPRETATIONS
Standards issued but not yet effective:
At the date of authorisation of these financial statements, the following standards and interpretations relevant to the
Group and which have not been applied in these financial statements, were in issue but were not yet effective.
Standard
Effective date,
annual period
beginning on or
after
Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture
If a parent loses control of a subsidiary which does not contain a business, as a result of a
transaction with an associate or joint venture, then the gain or loss on the loss of control is
recognised in the parents' profit or loss only to the extent of the unrelated investors' interest
in the associate or joint venture. The remaining gain or loss is eliminated against the carrying
amount of the investment in the associate or joint venture. The same treatment is followed for
the measurement to fair value of any remaining investment which is itself an associate or joint
venture. If the remaining investment is accounted for in terms of IFRS 9, then the measurement
to fair value of that interest is recognised in full in the parents' profit or loss.
To be
determined by
the IASB.
Non-current liabilities with covenants – amendments to IAS 1
The amendment applies to the classification of liabilities with loan covenants as current or non-
current. If an entity has the right to defer settlement of a liability for at least twelve months
after the reporting period, but subject to conditions, then the timing of the required conditions
impacts whether the entity has a right to defer settlement. If the conditions must be complied
with at or before the reporting date, then they affect whether the rights to defer settlement
exists at reporting date. However, if the entity is only required to comply with the conditions
after the reporting period, then the conditions do not affect whether the right to defer
settlement exists at reporting date. If an entity classifies a liability as non-current when the
conditions are only required to be met after the reporting period, then additional disclosures
are required to enable the users of financial statements to understand the risk that the
liabilities could become repayable within twelve months after the reporting period.
1 January 2024
Lease liability in a sale and leaseback – amendments to IFRS 16
The amendments to IFRS 16 add subsequent measurement requirements for sale and
leaseback transactions that satisfy the requirements in IFRS 15 Revenue from Contracts with
Customers to be accounted for as a sale. The amendments require the seller-lessee to
determine ‘lease payments’ or ‘revised lease payments’ such that the seller-lessee does not
recognise a gain or loss that relates to the right of use retained by the seller-lessee, after the
commencement date. The amendments do not affect the gain or loss recognised by the seller-
lessee relating to the partial or full termination of a lease. Without these new requirements, a
seller-lessee may have recognised a gain on the right of use it retains solely because of a
remeasurement of the lease liability (for example, following a lease modification or change in
the lease term) applying the general requirements in IFRS 16. This could have been particularly
the case in a leaseback that includes variable lease payments that do not depend on an index
or rate. As part of the amendments, the IASB amended an Illustrative Example in IFRS 16 and
added a new example to illustrate the subsequent measurement of a right-of-use asset and
lease liability in a sale and leaseback transaction with variable lease payments that do not
depend on an index or rate. The illustrative examples also clarify that the liability that arises
from a sale and leaseback transaction that qualifies as a sale applying IFRS 15 is a lease liability.
The amendments are effective for annual reporting periods beginning on or after 1 January
2024. Earlier application is permitted. If a seller-lessee applies the amendments for an earlier
period, it is required to disclose that fact. A seller-lessee applies the amendments
retrospectively in accordance with IAS 8 to sale and leaseback transactions entered into after
1 January 2024
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NOTES TO THE ANNUAL FINANCIAL STATEMENTS
58
Standard
Effective date,
annual period
beginning on or
after
the date of initial application, which is defined as the beginning of the annual reporting period
in which the entity first applied IFRS 16.
Lease liability in a sale and leaseback – amendments to IFRS 16
Specify when a currency is exchangeable into another currency and when it is not — a currency
is exchangeable when an entity is able to exchange that currency for the other currency through
markets or exchange mechanisms that create enforceable rights and obligations without undue
delay at the measurement date and for a specified purpose; a currency is not exchangeable into
the other currency if an entity can only obtain an insignificant amount of the other currency.
Specify how an entity determines the exchange rate to apply when a currency is not
exchangeable — when a currency is not exchangeable at the measurement date, an entity
estimates the spot exchange rate as the rate that would have applied to an orderly transaction
between market participants at the measurement date and that would faithfully reflect the
economic conditions prevailing. Require the disclosure of additional information when a
currency is not exchangeable — when a currency is not exchangeable an entity discloses
information that would enable users of its financial statements to evaluate how a currency’s
lack of exchangeability affects, or is expected to affect, its financial performance, financial
position and cash flows. The amendments are effective for reporting periods beginning on or
after 1 January 2025 and earlier application is permitted.
1 January 2025
IFRS 18 Presentation and Disclosure in Financial Statements
The new Standard, IFRS 18 Presentation and Disclosure in Financial Statements, will give
investors more transparent and comparable information about companies’ financial
performance, thereby enabling better investment decisions. It will affect all companies using
IFRS Accounting Standards. IFRS 18 introduces three sets of new requirements to improve
companies’ reporting of financial performance and give investors a better basis for analysing
and comparing companies:
Improved comparability in the statement of profit or loss (income statement)
Currently there is no specified structure for the income statement. Companies choose their own
subtotals to include. Often companies report an operating profit but the way operating profit
is calculated varies from company to company, reducing comparability. IFRS 18 introduces
three defined categories for income and expenses—operating, investing and financing—to
improve the structure of the income statement, and requires all companies to provide new
defined subtotals, including operating profit. The improved structure and new subtotals will
give investors a consistent starting point for analysing companies’ performance and make it
easier to compare companies.
Enhanced transparency of management-defined performance measures
Many companies provide company-specific measures, often referred to as alternative
performance measures. Investors find this information useful. However, most companies don’t
currently provide enough information to enable investors to understand how these measures
are calculated and how they relate to the required measures in the income statement. IFRS 18
therefore requires companies to disclose explanations of those company-specific measures
that are related to the income statement, referred to as management-defined performance
measures. The new requirements will improve the discipline and transparency of
management-defined performance measures, and make them subject to audit.
1 January 2027
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ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
59
Standard
Effective date,
annual period
beginning on or
after
More useful grouping of information in the financial statements
Investor analysis of companies’ performance is hampered if the information provided by
companies is too summarised or too detailed. IFRS 18 sets out enhanced guidance on how to
organise information and whether to provide it in the primary financial statements2 or in the
notes. The changes are expected to provide more detailed and useful information. IFRS 18 also
requires companies to provide more transparency about operating expenses, helping investors
to find and understand the information they need.
Retrospective application of the standard is mandatory for annual reporting periods starting
from 1 January 2027 onwards, but earlier application is permitted provided that this fact is
disclosed.
The directors anticipate that the adoption of these Standards and Interpretations in future periods will have no
material impact on the financial statements of the Group but may result in reduced disclosure requirements.
The Group expects to adopt all relevant standards and interpretations as and when they become effective.
Standards and interpretations which are effective in the current period (Changes in accounting policies):
None of these standards which became effective during the period which are applicable to the Group, have had a
material impact.
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NOTES TO THE ANNUAL FINANCIAL STATEMENTS
60
1. Segment analysis
IFRS 8 requires an entity to report financial and descriptive information about its reportable segments, which are operating segments or aggregations of operating segments that meet
specific criteria. Operating segments are components of an entity about which separate financial information is available that is evaluated regularly by the chief operating decision maker.
The Chief Executive Officer is the chief operating decision maker of the Group.
Management currently identifies individual projects as operating segments. These operating segments are monitored, and strategic decisions are made based upon their individual nature,
together with other non-financial data collated from exploration activities. Principal activities for these operating segments are as follows:
2023 Group
ADV001
Hindlip Lane
(£)
ARL018
Stather Road
(£)
Bordersley
(£)
Pyebridge
(£)
Rochdale Power
(£)
Sustineri Energy
(£)
Corporate
(£)
31 December 2023
(£)
Group
Revenue
-
-
-
341,207
-
-
-
341,207
Cost of sales
-
-
-
(223,838)
-
-
-
(223,838)
Administrative and other cost
(14,302)
(20,313)
(37,736)
(46,424)
(9,377)
(1,381)
(1,965,476)
(2,095,009)
Depreciation
-
(2,509)
(11,941)
(58,504)
-
-
(2,069)
(75,023)
Impairments and fair value
adjustments
-
(208,398)
(1,649,206)
-
-
-
(512,964)
(2,370,568)
Listing and Capital raising fees
-
-
-
-
-
-
(855,323)
(855,323)
Project and exploration
expenditure
(38,434)
(5,743)
(27,972)
(173,631)
(23,396)
(16,059)
(40,858)
(326,093)
Share in loss of associate
-
-
-
-
-
-
(97,340)
(97,340)
Investment and other income
-
-
-
126,933
-
-
65,359
192,292
Finance costs
-
-
-
-
-
2
(205,648)
(205,646)
Loss before tax
(52,736)
(236,963)
(1,726,855)
(34,257)
(32,773)
(17,438)
(3,614,319)
(5,715,341)
2022 Group
ADV001
Hindlip Lane
(£)
ARL018
Stather Road
(£)
Bordersley
(£)
Pyebridge
(£)
Rochdale Power
(£)
Sustineri Energy
(£)
Corporate
(£)
31 December 2022
(£)
Group
Revenue
-
-
-
1,036,743
-
-
-
1,036,743
Cost of sales
-
-
-
(778,802)
-
-
-
(778,802)
Administrative and other cost
(46,064)
(7,065)
(7,186)
(52,809)
(10,763)
(1,766)
(2,453,375)
(2,579,028)
Impairments and fair value
adjustments
(1,288,578)
(3,563,639)
(1,940,577)
-
-
-
(246,136)
(7,038,930)
Listing and Capital raising fees
-
-
-
-
-
-
(363,368)
(363,368)
Project and exploration
expenditure
(222,296)
-
-
(255,601)
(104,090)
(108,912)
(156,668)
(847,567)
Share in loss of associate
-
-
-
-
-
-
(181,684)
(181,684)
Investment and other income
-
-
-
-
-
10
93,856
93,866
Finance costs
(24,537)
-
-
-
-
-
(225,217)
(249,754)
Loss before tax
(1,581,475)
(3,570,704)
(1,947,763)
(50,469)
(114,853)
(110,668)
(3,532,592)
(10,908,524)
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
61
2023 Group
ADV001 Hindlip
Lane
(£)
ARL018 Stather
Road
(£)
Bordersley Power
(£)
Pyebridge Power
(£)
Rochdale Power
(£)
Sustineri Energy
(£)
Corporate
(£)
31 December
2023 (£)
Group
Assets
Segment assets
9,163
117,215
392,155
2,020,584
91,134
-
1,528,111
4,158,362
Liabilities
Segment liabilities
25,979
139,276
389,225
174,537
38,391
133,650
5,401,963
6,303,021
2022 Group
ADV001 Hindlip
Lane
(£)
ARL018 Stather
Road
(£)
Bordersley Power
(£)
Pyebridge Power
(£)
Rochdale Power
(£)
Sustineri Energy
(£)
Corporate
(£)
31 December
2022 (£)
Group
Assets
Segment assets
1,733,554
235
-
2,082,352
262,043
293,160
2,306,599
6,677,943
Liabilities
Segment liabilities
296,984
7,270
2,320
133,650
6,897
48,491
4,701,217
5,196,829
Geographical segments
The Group operates in six principal geographical areas being Tanzania (Exploration), Botswana (Exploration), Cyprus (Corporate), South Africa (Renewable Energy), United
Kingdom (Renewable Energy) and Ireland (Corporate).
Tanzania
(£)
Botswana
(£)
Cyprus
(£)
South
Africa
(£)
United
Kingdom
(£)
Ireland
(£)
31 December
2023
(£)
Carrying value of segmented assets
624
-
307,725
143,845
3,545,042
126,503
4,123,739
Revenue
-
-
-
-
341,207
-
341,207
Loss before tax
(85,095)
-
(862,827)
(277,592)
(3,805,221)
(684,606)
(5,715,341)
Tanzania
(£)
Botswana
(£)
Cyprus
(£)
South
Africa
(£)
United
Kingdom
(£)
Ireland
(£)
31 December
2022
(£)
Carrying value of segmented assets
-
-
218,735
293,160
5,564,783
601,265
6,677,943
Revenue
-
-
-
-
1,036,743
-
1,036,743
Loss before tax
(1,947,763)
(3,563,639)
(1,517,557)
(110,843)
(2,732,982)
(1,035,740)
(10,908,524)
All revenue generated was from the United Kingdom geographical area with the only customer being Statkraft Markets GMBH.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
62
2. Revenue
Revenue comprised ancillary electricity sales from operational testing of the renewable energy operations of MAST
Energy Developments PLC in the United Kingdom.
3. Investment and other Income
31 December
2023
(£)
Group
31 December
2022
(£)
Group
31 December
2023
(£)
Company
31 December
2022
(£)
Company
Interest received
1,128
44
1
34
(Reversal of gain) / Gain on
revaluation of derivative liabilities
(86,558)
86,558
-
-
Profit on sale of plant and equipment
6,424
7,264
-
-
Recoveries
57,806
-
89,936
16,232
Insurance claims
126,934
-
-
-
105,734
93,866
89,937
16,266
During the financial year the Group recorded other income resulting from the revaluation of derivative liabilities.
These liabilities were recognised as part of convertible loan notes entered into during the financial year. The
derivative liability was fair valued at year end and resulted in a gain for the financial year.
4. Finance costs
31 December
2023
(£)
Group
31 December
2022
(£)
Group
31 December
2023
(£)
Company
31 December
2022
(£)
Company
Interest paid to finance houses
169,687
223,623
115,397
151,375
Interest from leases (refer note 10)
35,959
26,131
-
-
205,646
249,754
115,397
151,375
31 December
2023 (£)
Group
31 December
2022 (£)
Group
Electricity sales
341,207
1,036,743
341,207
1,036,743
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
63
5. Loss on ordinary activities before taxation
Operating loss is stated after
the
following
key
transactions:
31 December
2023 (£)
Group
31 December
2022 (£)
Group
31 December
2023 (£)
Company
31 December
2022 (£)
Company
Depreciation of property,
plant and equipment
75,023
66,582
253
-
Group auditors’ remuneration
for audit of financial
statements
102,890
58,425
-
58,425
Subsidiaries auditors’
remuneration for audit of the
financial statements
140,662
172,767
-
-
Impairment of non-current
assets*
2,289,372
7,038,929
-
-
Impairment of subsidiary
investments
-
-
3,328,031
12,333,224
Share in loss from associate
97,340
-
-
-
Fair value adjustments
-
-
(24,037)
427,819
(Gains) / losses on
revaluations of derivatives
86,558
(86,558)
-
-
Profit on sale of assets
(6,424)
(7,264)
-
-
Disaggregation of
impairment of non-current
assets:
31 December
2023 (£)
Group
31 December
2022 (£)
Group
31 December
2023 (£)
Company
31 December
2022 (£)
Company
Impairment of property, plant
and equipment (refer note 10)
459,700
-
-
-
Impairment of intangible
assets (refer note 11)
2,258,774
3,229,155
-
-
Impairment of associates
(refer note 12)
(429,102)
3,809,774
-
-
Impairment of subsidiary
investments (refer note 23)
3,328,031
12,333,224
2,289,372
7,038,929
3,328,031
12,333,224
* The comparative balances for the impairments of non-current assets have been combined, please see separate disaggregation.
6. Staff costs (including Directors)
Group
31 December
2023 (£)
Group
31 December
2022 (£)
Company
31 December
2023 (£)
Company
31 December
2022 (£)
Wages and salaries
1,305,331
949,355
67,335
28,297
Share based remuneration
-
-
-
-
1,305,331
949,355
67,335
28,297
The average monthly number of employees (including executive Directors) during the period was as follows:
Group
31 December
2023
Group
31 December
2022
Company
31 December
2023
Company
31 December
2022
Exploration and development activities
9
10
-
1
Administration
5
7
1
1
14
17
1
2
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
64
7. Directors’ emoluments
Group
31 December
2023 (£)
Group
31 December
2022 (£)
Company
31 December
2023 (£)
Company
31 December
2022 (£)
Basic salary and fees accrued
283,079
374,308
24,366
Share based payments
-
-
-
283,079
374,308
24,366
The acting chairman in 2023 did not receive any additional emoluments other than those disclosed below. (2022: The
emoluments of the Chairman were £ 55,950). The emoluments of the highest paid director were £167,896 (2022:
£164,726).
Directors received shares in the value of £Nil during the year (2022: £Nil) and warrants to the value of £Nil (2022:
£Nil) during the year.
Key management personnel consist only of the Directors. Details of share options and interests in the Company’s
shares of each director are shown in the Directors’ report.
The following table summarises the remuneration applicable to each of the individuals who held office as a director
during the reporting period:
31 December 2023
Salary and
fees
accrued
£
Salary and
fees settled
in shares
£
Warrants
issued
£
Total
£
Louis Coetzee
167,896
-
-
167,896
Noel O’Keeffe
39,074
-
-
39,074
Ajay Saldanha
34,037
-
-
34,037
Christiaan Schutte
42,072
-
-
42,072
Total
283,079
-
-
283,079
31 December 2022
Salary and
fees
accrued
£
Salary and
fees settled
in shares
£
Warrants
issued
£
Total
£
Christian Schaffalitzky
16,990
-
-
16,990
Louis Coetzee
164,726
-
-
164,726
Noel O’Keeffe
38,135
-
-
38,135
Andreas Lianos
31,274
-
-
31,274
Christiaan Schutte
123,183
-
-
123,183
Total
374,308
-
-
374,308
As at 31 December 2023, an amount of £274,621 (2022: £174,482) was due and payable to Directors for services
rendered not yet settled.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
65
8. Taxation
Current tax
31 December
2023 (£)
31 December
2022(£)
Charge for the period in respect of corporate taxation
-
-
Total tax charge
-
-
The difference between the total current tax shown above and the amount calculated by applying the standard rate
of corporation tax for various jurisdictions to the loss before tax is as follows:
2023 (£)
2022 (£)
Loss on ordinary activities before tax
(5,715,341)
(10,908,524)
Income tax expense calculated at blended rate of 13.18% (2021: 13.18%)
(753,282)
(1,437,917)
Income which is not taxable
-
(4,615)
Expenses which are not deductible
301,033
913,814
Losses available for carry forward
(452,249)
528,718
Income tax expense recognised in the Statement of Profit or Loss
-
-
The effective tax rate used for the December 2023 and December 2022 reconciliations above is the corporate rate of
13.18% and 13.18% payable by corporate entities on taxable profits under tax law in that jurisdiction respectively.
The tax jurisdictions in which the Group operates are Cyprus, Ireland, South Africa, Tanzania and the United Kingdom.
No provision has been made for the 2023 deferred taxation as no taxable income has been received to date, and the
probability of future taxable income is indicative of current market conditions which remain uncertain. At the
Statement of Financial Position date, the Directors estimate that the Group has unused tax losses of £45,328,153
(2022: £41,896,825) available for potential offset against future profits which equates to an estimated potential
deferred tax asset of £6,231,314 (2022: £5,779,065). No deferred tax asset has been recognised due to the
unpredictability of the future profit streams. Losses may be carried forward indefinitely in accordance with the
applicable taxation regulations ruling within each of the above jurisdictions.
9. Loss per share
Basic loss per share
The basic loss and weighted average number of ordinary shares used for calculation purposes comprise the following:
Basic Loss per share
31 December
2023(£)
31 December
2022(£)
Loss for the period attributable to equity holders of the parent
(3,854,280)
(9,776,917)
Weighted average number of ordinary shares for the purposes of basic
loss per share
3,568,946,718
3,010,992,501
Basic loss per ordinary share (GBP)
(0.001)
(0.003)
As there are no instruments in issue which have a dilutive impact, the dilutive loss per share is equal to the basic loss
per share, and thus not disclosed separately.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
66
10. Property, plant and equipment
GROUP
Land
Furniture
and Fittings
Motor
Vehicles
Office
Equipment
I.T.
Equipment
Plant &
Machinery
Right of use
assets
Assets under
construction
Total
Cost
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
Opening Cost as at 1 January
2022
602,500
2,465
16,323
4,942
5,390
2,020,112
293,793
-
2,945,525
Disposals
-
(2,465)
-
(3,383)
(3,193)
(5,642)
-
-
(14,683)
Additions
-
-
-
-
6,031
75,061
62,090
-
143,182
Assets under development
-
-
-
-
-
939,664
-
-
939,664
Derecognition as a result of
waiver
-
-
-
-
-
(421,041)
-
-
(421,041)
Exchange movement
-
-
-
-
-
2,695
-
-
2,695
Closing Cost as at 31
December 2022
602,500
-
16,323
1,559
8,228
2,610,849
355,883
-
3,595,342
Disposal
(14,747)
(1,559)
(16,306)
Change in lease
-
-
-
-
-
-
62,274
-
62,274
Transfer between classes
-
-
-
-
-
(1,066,464)
-
1,066,464
-
Exchange movement
(1,576)
(701)
985
(1,292)
Closing Cost as at 31
December 2023
602,500
-
-
-
7,527
1,545,370
418,157
1,066,464
3,640,018
Accumulated Depreciation
(“Acc Depr”)
Acc Depr as at 1 January
2022
-
(2,465)
(16,323)
(4,407)
(4,074)
(8,704)
(9,793)
-
(45,766)
Disposals
-
2,465
-
3,383
3,193
1,974
-
-
11,015
Depreciation
-
-
-
-
(1,385)
(52,632)
(12,565)
-
(66,582)
Exchange movements
-
-
-
-
-
(11)
-
-
(11)
Acc Depr as at 31 December
2022
-
-
(16,323)
(1,024)
(2,266)
(59,373)
(22,358)
-
(101,344)
Disposals
14,747
1,559
-
-
-
-
16,306
Depreciation
-
-
-
(228)
(1,842)
(58,504)
(14,449)
-
(75,023)
Exchange movements
-
-
1,576
(307)
21
-
-
-
1,290
Impairment
-
-
-
-
-
-
(381,350)
(78,350)
(459,700)
Acc Depr as at 31 December
2023
-
-
-
-
(4,087)
(117,877)
(418,157)
(78,350)
(618,471)
Land
Furniture
and Fittings
Motor
Vehicles
Office
Equipment
I.T
Equipment
Plant &
Machinery
Right of use
assets
Assets under
construction
Total
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
67
Carrying Value
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
Carrying value as at 31
December 2022
602,500
-
-
535
5,962
2,551,476
333,525
333,525
3,493,998
Carrying value as at 31
December 2023
602,500
-
-
-
3,440
1,427,493
-
988,114
3,021,547
COMPANY
Land
Furniture
and Fittings
Motor
Vehicles
Office
Equipment
I.T
Equipment
Plant &
Machinery
Right of use
assets
Total
Cost
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
Opening Cost as at 1 January 2022
-
-
-
-
-
-
-
-
Additions
1,265
Closing Cost as at 31 December 2022
-
-
-
-
1,265
-
-
1,265
Closing Cost as at 31 December 2023
1,265
1,265
Accumulated Depreciation (“Acc Depr”)
Acc Depr as at 1 January 2022
-
-
-
-
-
-
-
-
Acc Depr as at 31 December 2022
-
-
-
-
-
-
-
-
Depreciation
-
-
-
-
(253)
-
-
(253)
Acc Depr as at 31 December 2023
-
-
-
-
(253)
-
-
(253)
Land
Furniture
and Fittings
Motor
Vehicles
Office
Equipment
I.T
Equipment
Plant &
Machinery
Right of use
assets
Total
Carrying Value
(£)
(£)
(£)
(£)
(£)
(£)
(£)
(£)
Carrying value as at 31 December 2022
-
-
-
-
1,265
-
-
1,265
Carrying value as at 31 December 2023
-
-
-
-
1,012
-
-
1,012
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
68
Right of use asset
The Group has one lease contract for land it shall utilise to construct a 5MW gas-fuelled power generation plant. The
land is located at Bordesley, Liverpool St. Birmingham.
The land has a lease term of 20 years, with an option to extend for 10 years which the Group has opted to include due
to the highly likely nature of extension as at the time of the original assessment.
The Group’s obligations under its leases are secured by the lessor’s title to the leased assets. The Group’s incremental
borrowing rate ranges between 8.44% and 10.38%.
The Group has valued its property, plant and equipment in line with its directors’ estimation of the Value in Use for
those assets. Kindly refer to note 11 for the key variables used in the estimation of the value thereof.
Right of use asset
31 December
2023
(£)
Group
31 December
2022
(£)
Group
Set out below are the carrying amounts of right-of-use assets
recognised and the movements during the period:
Opening balance
333,525
284,000
Additions
-
62,090
Change in lease
62,274
-
Impairment
(381,350)
-
Depreciation
(14,449)
(12,565)
Closing balance
-
333,525
Lease liability
Set out below are the carrying amounts of lease liabilities and the
movements during the period:
Opening balance
350,654
291,518
Additions
-
60,005
Interest
35,959
26,131
Change in lease
62,274
Repayment
(39,292)
(27,000)
Closing balance
409,595
350,654
Spilt of lease liability between current and non-current portions:
Non-current
405,390
346,674
Current
4,205
3,980
Total
409,595
350,654
Future minimum lease payments fall due as follows
- within 1 year
39,826
33,960
- later than 1 year but within 5 years
159,304
135,840
- later than 5 years
851,812
756,720
Subtotal
1,050,942
926,520
- Unearned future finance charges
(641,347)
(575,866)
Closing balance
409,595
350,654
A 100bp change in the Incremental Borrowing Rate (“IBR”), would result in a £Nil (2022: £29,603) change in the Right
of Use Asset, and the corresponding Lease Liability of £33,643 (2022: £29,603) on transaction date. Short term leases
to the value of £43,949 (2023: £5,506) were not recognised as right of use Assets
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
69
11. Intangible assets
Intangible assets consist of separately identifiable prospecting, exploration and renewable energy assets in the form of licences, intellectual property or rights acquired either
through business combinations or through separate asset acquisitions.
The following reconciliation serves to summarise the composition of intangible assets as at period end:
ADV001
Hindlip
Lane (£)
ARL018
Stather
Road (£)
Bordersley
Power (£)
Mbeya Coal
to Power
Project (£)
Rochdale
Power
(£)
Shankley
Biogas (£)
Sustineri
Energy
(£)
Total (£)
Carrying value at 1 January 2022
-
-
2,595,000
1,940,577
150,273
-
278,700
4,964,550
Impairments
-
-
(1,288,578)
(1,940,577)
-
-
-
(3,229,155)
Acquisition of ARL018 Stather Road
-
91,482
-
-
-
-
-
91,482
Acquisition of ADV001 Hindlip Lane
247,506
-
-
-
-
-
-
247,506
Acquisition of Shankley Biogas Ltd
-
-
-
-
-
603,050
-
603,050
Exchange movements
-
-
-
-
-
-
14,460
14,460
Carrying value at 1 January 2023
247,506
91,482
1,306,422
-
150,273
603,050
293,160
2,691,893
Impairments
-
(91,482)
(1,306,422)
-
(603,050)
(257,820)
(2,258,774)
Exchange movements
-
-
-
-
-
-
(35,340)
(35,340)
Carrying value at 31 December 2023
247,506
-
-
-
150,273
-
-
397,779
During the year the Group disposed of its holdings in the Mbeya Coal to Power Project.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
70
Intangible assets are amortised once commercial production commenced, over the remaining useful life of the project,
which is estimated to be between 20 years, depending on the unique characteristics of each project.
Until such time as the underlying operations commence production, the Group performs regular impairment reviews
to determine whether any impairment indicators exist.
When the following circumstance arise, it indicates that an entity should test an intangible asset for impairment:
the carrying value of the project assets (deemed to be property, plant and equipment as well as intangible asset)
exceed the recoverable amount of the assets.
In assessing whether a write-down is required in the carrying value of a potentially impaired intangible asset, the
asset’s carrying value is compared with its recoverable amount. The recoverable amount is the higher of the asset’s
fair value less cost of disposal (FVLCD) and value in use (VIU). The valuation techniques applicable to the valuation of
the abovementioned intangible assets comprise a combination of fair market values, discounted cash flow projections
and historic transaction prices.
The following key assumptions influence the measurement of the intangible assets’ recoverable amounts, through
utilising the forecast-based estimates performed:
•
energy prices pegged from base year;
•
commercial viability period;
•
cost of capital related to funding requirements;
•
applicable inflationary increases in energy prices and related costs;
•
future operating expenditure for developments of the project; and
•
co-operation of key project partners going forward.
Through review of the project specific financial, operational, market and economic indicators applicable to the above
intangible assets, as well as consideration of the various elements which contribute toward the indication of
impairment, it was concluded impairment was necessary in the 2023 financial period.
Mbeya Coal to Power Project
The project has not made any significant progress and as at year end did not indicate any improvement and is
therefore held at £Nil. Refer to note 26 where the parent of the Mbeya Coal to Power Project was disposed during
September 2024.
Shankley Biogas Limited
The investment was originally seen as recoverable, but during the 2023 the dispute with the vendor which started
during 2022 was not significantly progressed due to the vendor’s inability to provide sufficient and reliable financial
information for Shankley Biogas Limited, despite numerous requests in this regard, and the Company being unable to
agree an option to lease agreement in respect of the site with the vendor. The Company has been engaged in
constructive negotiations to reach an amicable resolve for the ongoing dispute and is confident that this will be settled
soon. This has impacted the viability thereof.
Management has sought to resolve this with the former owners of the business without any formal way forward. This
has therefore resulted in the project being idle. This, coupled with cash flow restrictions of Kibo, has led to no further
development of the project taking place.
The current considerations of management is:
•
Dissolving the purchase agreement and in effect walking back the transaction in full.
•
Legal action to maintain ownership, resolve the points of contention with the former owners and develop the
projects.
None of the positions have been finalised and as such the project is still deemed to be under control of Kibo which
results in an impairment of £600,000 of the goodwill. If the acquisition contract is cancelled the impairment would be
reversed and brought back to its current net book value (assets less liabilities) of £Nil.
Any contingent liabilities arising from the actions of the former owner is deemed to fall outside of Kibo’s responsibility
and Kibo has obtained legal opinion that the liabilities would be the responsibility of the former owners as he had
acted outside of the contractual agreement.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
71
A summary of the assessment performed for each of the renewable energy intangible assets are detailed below.
Key estimation variables
ADV001
ARL018
Recoverable value of project
£685,141
-
Recoverable value method of calculation
FVLCD
FVLCD
Life of project
20 years
20 years
Weighted average cost of capital (“WACC”)
12.39%
12.39%
Output
7.0 MW
2.4 MW
Average £/MW output
£171,347 per MW output
£172,697 per MW output
Debt/Equity ratio
67/33
67/33
Sensitivity analysis
Project delayed by 6 months
(£51,689)
-
250bps Increase/Decrease in WACC
(£685,141) / £1,079,758
-
250bps Increase/Decrease in £/MW output
£393,537 / (£393,537)
-
Project life decreased by 5 years
(£306,816)
-
Key estimation variables
Bordersley
Rochdale
Recoverable value of project
£48,449
£568,844
Recoverable value method of calculation
FVLCD
FVLCD
Life of project
20 years
20 years
Weighted average cost of capital (“WACC”)
12.39%
12.39%
Output
5.0 MW
4.4 MW
Average annual £/MW output
£410,606 per MW output
£518,620 per MW output
Debt/Equity ratio
67/33
67/33
Sensitivity analysis
Project delayed by 6 months
(£3,304)
(£43,833)
250bps Increase/Decrease in WACC
(£48,449) / £612,219
(£544,043) / £753,963
250bps Increase/Decrease in £/MW output
£115,246 / (£48,499)
£268,599 / (£268,599)
Project life decreased by 5 years
(£48,449)
(£317,634)
Key estimation variables
Pyebridge
Sustineri Energy
Recoverable value of project
£3,166,679
-
Recoverable value method of calculation –
based on active project
FVLCD
FVLCD
Life of project
20 years
10 years
Output
8.0 MW
2.7 MW
Average annual £/MW output
£297,000 per MW output
£15,000 - £20,000 per MW
output
The Group is exposed to significant market volatility in its estimate of the weighted average cost of capital. The risk-
free rate for the market in which the Group operates was negatively affected during the financial year as a direct result
of the war between Russia and Ukraine.
The market interest rates have increased significantly year on year and the weighted average cost of capital rose from
+-6.2% in the previous year to 13.5% for the current financial year. This has resulted in impairments being required
for the investments and related property, plant and equipment.
Market indicators are predominantly showing an expected decrease in the interest rates during the second half of the
2023 financial year. As a result of the disposal of the interest in these projects during 2024, the group does not expect
that a reversal of impairment would occur.
The assessment of the value in use of the intangible assets resulted in an impairment of £2,258,774 (2022:
£3,229,155) being recognised. The most significant contributor to the impairment required was the increase of the
weighted average cost of capital due to increase in market interest rates.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
72
The directors have performed further sensitivity analysis on the value in use assessments for the four projects based
in the UK and Sustineri based in South Africa with the following variables being assessed:
Key estimation variables
Reason for assessment
Projects delayed by 6 months
The projects may be delayed due to project funding restrictions.
250bps Increase/Decrease in WACC
The market interest rates have been volatile during the financial year
and due to the above average interest rate increases an assessment of
250bps increase or decrease was performed.
250bps Increase/Decrease in
£/MW output
The energy market has experienced above average movements during
the financial year and an assessment of 250bps increase or decrease was
performed.
Projects life reduced by 5 years
The projects might be abandoned in 15 years due to excessive wear on
the plant or significant change in market sentiment regarding natural
gas.
12. Investment in associates
Investment in associates consist of equity investments where the Group has an equity interest between 20% and 50%
and does not exercise control over the investee.
The following reconciliation serves to summarise the composition of investments in associates as at period end:
Katoro Gold
PLC (£)
Mabesekwa
Coal
Independent
Power
Project (£)
Total (£)
Carrying value at 1 January 2022
528,764
3,563,639
4,092,403
Share of losses for the year
(181,684)
-
(181,684)
Impairment loss
(246,135)
(3,563,639)
(3,809,774)
Carrying value at 1 January 2023
100,945
-
100,945
Share of losses for the year
(97,340)
-
(97,340)
Reversal of impairment loss
121,377
307,725
429,102
Disposal of intangible asset
(307,725)
(307,725)
Carrying value at 31 December 2023
124,982
-
124,982
Mabesekwa Coal Independent Power Project
On 3 April 2018, the Group completed the acquisition of an 85% interest in the Mabesekwa Coal Independent Power
Project, located in Botswana. The intangible asset was recognised at the fair value of the consideration paid, which
emanates from the fair value of the equity instruments issued as at transaction date, being £9,376,312.
The Mabesekwa Coal Independent Power Project (“MCIPP”) is located approximately 40km east of the village of
Tonata and approximately 50km southeast of Francistown, Botswana’s second largest city. Certain aspects of the
Project have been advanced previously by Sechaba Natural Resources Limited (“Sechaba”), including water and land
use permits and environmental certification. Mabesekwa consists of an in situ 777Mt Coal Resource. A pre-feasibility
study on a coal mine and a scoping study on a coal fired thermal power plant has been completed. Kibo is in possession
of a Competent Persons Report on the project, which includes a SAMREC-compliant Maiden Resource Statement on
the excised 300 Mt portion of the Mabesekwa coal deposit.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
73
In September 2019, Kibo and Shumba Energy Limited (“Shumba”) signed a binding Heads of Agreement to reorganise
the arrangements for the MCIPP and its associated coal asset in Botswana. Under the reorganisation the MCIPP
retained assets will be consolidated back into KEB and Kibo’s interest in KEB will be reduced to 35% to maintain
Kibo’s look-through interest in the MCIPP resource and make sundry adjustments to recognise Kibo’s project
expenditure. In exchange for the increase in the equity interest held by Shumba, Shumba would forego the previous
claim it had against a portion of the MCIPP coal resources, thereby increasing the value of the interest held by KEB.
During the financial year the investment in Mabasekwa was disposed of for the shares in the listed company Shumba
Energy Limited with a fair value of £307,725 at disposal date. The shares fair valued at year end did not change and
remained as £307,725. Shumba Energy trades on the Botswana Stock Exchange. The intangible asset for the
Mabasekwa Coal assets were valued at the disposal price which resulted in a reversal of impairment of £307,725.
Kibo Energy Botswana (Pty) Ltd recognised no revenue during the year (2022: Nil). No dividends were received
during the year (2022: Nil). Kibo Energy Botswana (Pty) Ltd’s principal place of business is Plot 2780, Extension 9,
Gaborone, Botswana.
During the 2024 year, the investment in Shumba was disposed of as part of the disposal of Kibo Mining (Cyprus)
Limited (“KMCL”) on 11 October 2024, for a consideration to Kibo Energy Plc of £Nil as the proceeds with said disposal
was set off against KMCL’s payroll liabilities under the terms of the share purchase agreement, which resulted in a
group loss on disposal of £307,725. The disposal was as a result of the Group restructuring initiated during June 2024
(refer note 26).
Katoro Gold PLC
On 30 September 2021, the Group lost the ability to exercise control over the operations of Katoro Gold PLC and its
subsidiaries (hereinafter referred to as the “Katoro Group”) following from the resignation of certain Kibo directors.
Following the loss of control, in accordance with IFRS 10, the assets, liabilities, non-controlling interest and foreign
currency translation reserves attributable to the operations of the Katoro Group were derecognised, with the
remaining equity interest retained in the associate being recognised at fair value, resulting in a loss on deemed
disposal recognised through profit or loss, as detailed below.
The value of the remaining equity interest in Katoro Gold PLC on initial recognition as an associate, was determined
based on the fair value of the listed equities.
During the current year the shareholding of Katoro declined to below the 20% threshold. Due to significant influence
retained over Katoro as a result of shared board members during the 2023 year, Katoro was deemed to be an associate
as at reporting date. In the 2024 financial year board changes in both Kibo and Katoro resulted in Katoro no longer
being recognised as an associate.
Summarised financial information of the associate is set out below:
Group (£)
31 December
2023
Group (£)
31 December
2022
Non-current assets
-
-
Current assets
16,330
65,936
Current liabilities
(654,618)
(296,844)
Loss for the year ended
(607,365)
(1,066,616)
Cash flow from operating activities
(200,388)
(893,310)
Cash flow from investing activities
-
-
Cash flows from financing activities
144,711
114,950
Katoro Gold PLC recognised no revenue during the year (2022: £Nil). No dividends were received during the year
(2022: £Nil). Kibo owns 96,138,738 of Katoro’s 669,497,693 issued shares or 14.36% (2022: 20.88%) of the issued
shares at year end.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
74
At 31 December 2023 the group equity accounted for loss and other comprehensive income in Katoro to the value of
£97,340. In terms of group accounting policies, the carrying value of investments in associates that are publicly traded
are measured at the fair value of their shares. The resultant difference is recognised as an impairment loss or reversal
of impairment. The net reversal of impairment amounted to £121,377 for the year (2022: £246,135 impairment loss).
Katoro Gold PLC’s principal place of business is the 6th Floor, 60 Gracechurch Street, London, EC4V OHR. Project
specific information about Katoro Gold PLC can be obtained from their website at katorogold.com.
13. Other financial assets
Group (£)
Group (£)
2023
2022
Other financial assets comprise of:
Shumba Energy Limited (refer note 12)
307,725
307,725
-
Impairment allowance for other financial assets receivable
Shumba Energy Limited (refer note 12)
-
-
Group
Reconciliation of movement in other financial assets
Shumba
Energy
Limited
£
Carrying value as at 31 December 2022
-
Additions
307,725
Carrying value as at 31 December 2023
307,725
Fair value hierarchy measurement
Level 1
14. Other receivables
Group 2023
(£)
Group 2022
(£)
Company
2023 (£)
Company
2022 (£)
Amounts falling due within one year:
Other debtors
242,272
227,223
156,114
90,720
242,272
227,223
156,114
90,720
The carrying value of current receivables approximates their fair value.
Trade and other receivables pledged as security
None of the above stated trade and other receivables were pledged as security at period end. Credit quality of trade
and other receivables that are neither past due nor impaired can be assessed by reference to historical repayment
trends of the individual debtors.
15. Cash and cash equivalents
Group (£)
Company (£)
Cash consists of:
2023
2022
2023
2022
Short term convertible cash reserves
64,057
163,884
1,507
19,442
64,057
163,884
1,507
19,442
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
75
Cash has not been ceded or placed as encumbrance toward any liabilities as at year end.
16. Share capital - Group and Company
2023
2022
Authorised equity
10,000,000,000 Ordinary shares of €0.0001 each
€1,000,000
-
5,000,000,000 Ordinary shares of €0.001 each
-
€5,000,000
1,000,000,000 deferred shares of €0.014 each
€14,000,000
€14,000,000
3,000,000,000 deferred shares of €0.009 each
€27,000,000
€27,000,000
5,000,000,000 deferred shares of €0.0009 each
€4,500,000
-
€46,500,000
€46,000,000
Allotted, issued and fully paid shares
2023: 3,779,866,683 Ordinary shares of €0.0001 each
£258,511
-
2022: 3,039,197,458 Ordinary shares of €0.001 each
-
£1,934,599
1,291,394,535 Deferred shares of €0.009 each
£9,257,075
£9,257,075
805,053,798 Deferred shares of €0.014 each
£9,948,807
£9,948,807
3,779,866,683 Deferred shares of €0.0009 each
£2,326,595
-
£21,790,988
£21,140,481
Number of
Shares
Ordinary
Share
Capital
(£)
Deferred
Share
Capital
(£)
Share
premium
(£)
Balance at 31 December 2021
2,930,657,437
1,836,562
19,205,882
45,429,328
Shares issued during the period
108,540,021
98,036
-
86,753
Balance at 31 December 2022
3,039,197,458
1,934,598
19,205,882
45,516,081
Shares issued during the period
740,669,225
650,508
299,920
Deferred shares issued during
the period
-
(2,326,595)
2,326,595
-
Balance at 31 December 2023
3,779,866,683
258,511
21,532,477
45,816,001
All ordinary shares issued have the right to vote, right to receive dividends, a copy of the annual report, and the right
to transfer ownership.
During the year, the Company resolved to reduce the nominal value of the ordinary shares in issue from €0.001 to
€0.0001, whilst retaining the same number of shares. Under the capital re-organisation, each ordinary share was
converted into one new deferred share of €0.0009 each and one new ordinary share of €0.0001 each.
The Deferred Shares will not entitle holders to receive notice of, or attend or vote at any general meeting of the
Company or to receive a dividend or other distribution or to participate in any return on capital on a winding up other
than the nominal amount paid following a substantial distribution to the holders of the Ordinary Shares in the
Company.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
76
The company issued the following ordinary shares during the period, with regard to key transactions:
•
14,025,314 new Kibo Shares were issued on 25 January 2023 of €0.001 each at a deemed issue price of
£0.0014 per share to a supplier in settlement of £19,635 of amounts due;
•
510,369,286 new Kibo Shares were issued on 11 April 2023 of €0.001 each at a deemed issue price of
£0.0014 to and Institutional Lender pursuant to partial settlement of convertible loan notes;
•
168,274,625 new Kibo Shares were issued on 26 April 2023 of €0.001 each at a deemed issue price of
£0.0011 per share pursuant to 168,274,625 warrants exercised
• 48,000,000 new Kibo Shares were issued on 26 May 2023 of €0.001 each at a deemed issue price of
£0.0011 per share pursuant to 48,000,000 warrants exercised.
17. Control reserve
The transaction with Opera Investments PLC in 2017 represented a disposal without loss of control. Under IFRS this
constitutes a transaction with equity holders and as such is recognised through equity as opposed to recognising
goodwill. The control reserve represents the difference between the purchase consideration and the book value of the
net assets and liabilities acquired in the transaction with Opera Investments. The control reserve balance as at the
year-end is Nil, following the loss of control over of Katoro Gold PLC effective from 30 September 2021.
18. Share based payments reserve
The following reconciliation serves to summarise the composition of the share-based payment reserves as at period
end, which incorporates both warrants and share options in issue for the Group:
Group (£)
Company (£)
2023
2022
2023
2022
Opening balance of share-based payment
reserve
73,469
466,868
73,469
466,868
Repricing of warrants
(45,850)
-
(45,850)
-
Issue of share options and warrants
380,741
24,774
-
24,774
Warrants attributable to NCI
(380,741)
-
-
-
Expired warrants during the period
(17,441)
(418,173)
(17,441)
(418,173)
Warrants exercised
(10,178)
-
(10,178)
-
-
73,469
-
73,469
Share Options and Warrants detail
Share Options
Kibo and MAST Energy Developments PLC had no share options in issue throughout the year
Warrants
The following reconciliation serves to summarise the value attributable to the share-based payment reserve as at
period end for the Company:
Group (£)
Company (£)
2023
2022
2023
2022
Opening balance of warrant reserve
73,469
466,868
73,469
466,868
Repricing of warrants
(45,850)
-
(45,850)
-
Issue of share options and warrants
380,741
24,774
-
24,774
Expired warrants during the period
(17,441)
(418,173)
(17,441)
(418,173)
Warrants exercised
(10,178)
-
(10,178)
-
380,741
73,469
-
73,469
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
77
The following reconciliation serves to summarise the quantity of warrants in issue as at period end:
Group
Company
2023
2022
2023
2022
Opening balance
1,128,024,625
1,180,861,140
1,128,024,625
1,180,861,140
New warrants issued
86,814,562
168,274,625
-
168,274,625
Warrants exercised
(284,524,625)
-
(284,524,625)
-
Warrants expired
(843,500,000)
(221,111,140)
(843,500,000)
(221,111,140)
86,814,562
1,128,024,625
-
1,128,024,625
At 31 December 2023 the Group had no share options and 86,814,562 (2022: 1,128,024,625) warrants outstanding:
Warrants (All arose in Mast Energy Developments Plc)
Date of Grant
Issue date
Expiry date
Exercis
e price
Number
granted
Exercisable as
at 31 December
2023
18 May 2023
18 May 2023
18 May 2026
2p
2,255,656
2,255,656
18 May 2023
18 May 2023
18 May 2026
2p
2,255,656
2,255,656
18 May 2023
18 May 2023
18 May 2027
0.89
20,575,813
20,575,813
18 May 2023
18 May 2023
18 May 2027
1.8p
20,575,813
20,575,813
18 May 2023
18 May 2023
18 May 2027
0.89p
20,575,813
20,575,813
18 May 2023
18 May 2023
18 May 2027
1.8pp
20,575,813
20,575,813
86,814,564
86,814,564
Total contingently issuable shares
86,814,564
86,814,564
Expenses settled through the issue of shares
The Group recognised the following expense related to equity settled share-based payment transactions:
2023 (£)
2022 (£)
Geological expenditure settled
-
25,000
Listing and capital raising fees
195,559
159,790
Shares and warrants issued to directors and staff
-
-
195,559
184,790
19. Translation reserve
The foreign exchange reserve relates to the foreign exchange effect of the retranslation of the Group’s overseas
subsidiaries on consolidation into the Group’s financial statements, taking into account the financing provided to
subsidiary operations is seen as part of the Group’s net investment in subsidiaries.
Group
2023
(£)
2022
(£)
Opening balance
(93,993)
(466,184)
Movement during the period
576,313
372,191
Closing balance
482,320
(93,993)
The gain on foreign currency translation is a result of investments in foreign denominated subsidiaries with the
primary investments in Euro and secondary investments in US Dollar and South African Rand. The devaluation of the
Euro to the British Pound specifically resulted in above normal gains experienced in the current year. The foreign
currency translation reserve is expected to be derecognised during the 2024 year as a result of Kibo Mining Cyprus
Limited's disposal (refer note 26).
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
78
20. Non-controlling interest
The non-controlling interest brought forward relates to the minority equity attributable to Sustineri Energy and Mast
Energy Developments Plc. As at 31 December 2023, the Group’s non-controlling interest comprises 57,42% equity
held in MAST Energy Development PLC (2022: 42.14%) and 35% in Sustineri Energy (2022: 35%).
Group
2023 (£)
2022 (£)
Opening balance
1,164,218
1,962,816
Change of interest in subsidiary without loss of control
483,786
333,009
Warrants attributable to NCI
380,741
-
Director’s loan repayable in shares
81,329
-
Comprehensive loss for the year allocated to non-controlling interest
(1,854,866)
(1,131,607)
Closing balance of non-controlling interest
255,208
1,164,218
The summarised financial information for significant subsidiaries in which the non-controlling interest has an
influence, namely MAST Energy Developments PLC as at ended 31 December 2023, is presented below:
MAST Energy Development PLC
2023 (£)
2022 (£)
Statement of Financial position
Total assets
2,601,549
4,617,505
Total liabilities
2,986,058
2,500,761
Statement of Profit and Loss
Revenue for the period
341,207
1,036,743
Loss for the period
(3,539,394)
(2,733,000)
Statement of Cash Flow
Cash flows from operating activities
(727,125)
(1,284,427)
Cash flows from investing activities
-
(974,350)
Cash flows from financing activities
595,193
585,500
21. Trade and other payables
Group
2023 (£)
Group
2022 (£)
Company
2023 (£)
Company
2022 (£)
Amounts falling due within one year:
Trade payables
1,862,542
680,722
420,340
159,009
Derivative liabilities (refer below)
22,232
20,386
-
-
Other payables
600,000
884,015
600,000
-
Accrued liabilities
1,427,449
809,967
81,885
667,026
3,912,223
2,395,090
1,102,225
826,035
Movements in derivative liabilities included in Trade and
Other Payables:
(Derecognition) / Recognition of derivative liability
derived from the convertible loan notes
(64,326)
106,944
-
-
Gain on fair value adjustment of derivative liability
86,558
(86,558)
-
-
22,232
20,386
-
-
The carrying value of current trade and other payables equals their fair value due mainly to the short-term nature of
these receivables.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
79
Derivatives
The derivative liability is derived from the convertible credit note loans. The convertible feature within the credit
notes enables the noteholders to convert into a fixed number of shares at the Fixed Premium Payment Price (FPPP).
This price does have variability, although the FPPP is set at the Reference price, in the event that a share placing occurs
93,910 at below the Reference price, the FPPP will be the share placing price (“round down” feature). The conversion
includes and embedded derivative, as its value moves in relation the share price (through a placing price) and it is not
related to the underlying host instrument, the debt. The effect is that the embedded derivative is accounted for
separately at fair value.
22. Borrowings and other financial liabilities
Group
2023 (£)
Group
2022 (£)
Company
2023 (£)
Company
2022 (£)
Amounts falling due within one year:
Short term loans
1,217,913
1,195,239
1,217,913
1,195,239
Other financial liabilities – Convertible loan notes
318,925
1,012,790
-
657,985
Amounts falling due between one year and five
years:
Other financial liabilities – Convertible loan notes
444,365
243,056
-
-
1,981,203
2,451,085
1,217,913
1,853,224
Group
2023 (£)
Group
2022 (£)
Company
2023 (£)
Company
2022 (£)
Reconciliation of borrowings and other financial
liabilities:
Opening balance
2,451,085
1,079,691
1,853,224
119,004
Proceeds from convertible loans in MED
171,931
650,000
-
Proceeds from borrowings in Kibo
1,672,824
1,672,824
Recognition of derivative liability derived from the
convertible loan notes
(106,944)
-
Raised during the year
-
-
Repayment of deferred payment liability
(555,535)
-
Repayment of borrowings
(466,870)
(44,917)
(322,687)
(44,917)
Waiver of deferred payment liability
(421,041)
-
Debt forgiven
-
-
Interest charged
204,128
192,087
115,397
121,393
Costs incurred on borrowings
195,559
74,709
146,609
74,709
Settled through the issue of shares
(574,630)
(89,789)
(574,630)
(89,789)
Closing balance
1,981,203
2,451,085
1,217,913
1,853,224
Breakdown of borrowings and other financial
liabilities:
Non-current
-
243,056
-
-
Current
1,981,203
2,208,029
1,217,913
1,853,224
Total
1,981,203
2,451,085
1,217,913
1,853,224
Convertible loan notes
Short term loans relate to two unsecured loan facilities from the institutional investor which are repayable either
through the issue of ordinary shares or payment of cash by the Company.
These facilities have repayment periods of 18 and 24 months respectively for each drawdown from the facility. The
facilities may be converted at the option of the note holders once certain milestones have been met.
During the year the loan notes were reprofiled.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
80
23. Investment in subsidiaries and associates
Breakdown of investments as at 31 December 2023
Associate
undertakings
(£)
Subsidiary
undertakings
(£)
Kibo Mining (Cyprus) Limited
-
2,210,659
Katoro Gold PLC
124,982
-
Shankley Biogas Limited
-
-
Total investments
124,982
2,210,659
Breakdown of investments as at 31 December 2022
Associate
undertakings
(£)
Subsidiary
undertakings
(£)
Kibo Mining (Cyprus) Limited
-
4,987,662
Katoro Gold PLC
100,945
-
Shankley Biogas Limited
-
600,000
Total cost of investments
100,945
5,587,662
Investments at Cost
At 1 January 2022
528,764
16,233,997
Additions in Kibo Mining Cyprus Limited
-
1,086,889
Purchase of Shankley Biogas Limited (refer note 11)
-
600,000
Impairment of subsidiaries
-
(12,333,224)
Fair value adjustment of Katoro Gold PLC
(427,819)
-
At 31 December 2022 (£)
100,945
5,587,662
Reduction in Kibo Mining Cyprus Limited
(48,972)
Impairment of subsidiaries
(3,328,031)
Fair value adjustment of Katoro Gold PLC
24,037
-
At 31 December 2023 (£)
124,982
2,210,659
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
81
At 31 December 2023 the Company had the following undertakings:
Description
Subsidiary,
associate,
Joint Ops
Activity
Incorporated
in
Interest
held
(2023)
Interest
held
(2022)
Directly held
investments
Kibo
Mining
(Cyprus)
Limited
Subsidiary
Treasury Function
Cyprus
100%
100%
Katoro Gold PLC
Associate
Mineral
Exploration
United Kingdom
14.36%
20.88%
Indirectly
held
investments
MAST Energy Development
PLC
Subsidiary
Power Generation
United Kingdom
42.58%
57.86%
Sloane Developments
Limited
Subsidiary
Holding Company
United Kingdom
42.58%
57.86%
MAST Energy Projects
Limited
Subsidiary
Power Generation
United Kingdom
42.58%
57.86%
Bordersley Power Limited
Subsidiary
Power Generation
United Kingdom
42.58%
57.86%
Rochdale Power Limited
Subsidiary
Power Generation
United Kingdom
42.58%
57.86%
Pyebridge Power Limited
Subsidiary
Power Generation
United Kingdom
42.58%
57.86%
Kibo Gold Limited
Associate
Holding Company
Cyprus
2.87%
20.88%
Savannah Mining Limited
Associate
Mineral
Exploration
Tanzania
2.87%
20.88%
Kibo Nickel Limited
Associate
Holding Company
Cyprus
9.33%
20.88%
Eagle Exploration Limited
Associate
Mineral
Exploration
Tanzania
9.33%
20.88%
Katoro (Cyprus) Limited
Associate
Mineral
Exploration
Cyprus
9.33%
20.88%
Katoro South Africa Limited
Associate
Mineral
Exploration
South Africa
9.33%
20.88%
Mbeya Holdings Limited
Subsidiary
Holding Company
Cyprus
100%
100%
Mbeya Development Limited
Subsidiary
Holding Company
Cyprus
100%
100%
Mbeya Mining Company
Limited
Subsidiary
Holding Company
Cyprus
100%
100%
Mbeya Coal Limited
Subsidiary
Mineral
Exploration
Tanzania
100%
100%
Rukwa Holding Limited
Subsidiary
Holding Company
Cyprus
100%
100%
Mbeya Power Tanzania
Limited
Subsidiary
Power Generation
Tanzania
100%
100%
Kibo Mining South Africa
(Pty) Ltd
Subsidiary
Treasury Function
South Africa
100%
100%
Sustineri Energy (Pty) Ltd
Subsidiary
Renewable Energy
South Africa
65%
65%
Kibo Exploration Limited
Subsidiary
Treasury Function
Tanzania
100%
100%
Kibo MXS Limited
Subsidiary
Holding Company
Cyprus
100%
100%
Mzuri Exploration Services
Limited
Investment
Exploration
Services
Tanzania
4.78%
4.78%
Protocol Mining Limited
Investment
Exploration
Services
Tanzania
4.78%
4.78%
Jubilee Resources Limited
Subsidiary
Mineral
Exploration
Tanzania
100%
100%
Kibo Energy Botswana
Limited
Subsidiary
Holding
Company
Cyprus
100%
100%
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
82
Description
Subsidiary,
associate,
Joint Ops
Activity
Incorporated
in
Interest
held
(2023)
Interest
held
(2022)
Kibo Energy Botswana (Pty)
Ltd - disposed
Associate
Mineral
Exploration
Botswana
0%
35%
Kibo Energy Mozambique
Limited
Subsidiary
Holding
Company
Cyprus
100%
100%
Pinewood Resources Limited
Subsidiary
Mineral
Exploration
Tanzania
100%
100%
BENGA Power Plant Limited
Joint Venture
Power
Generation
Tanzania
65%
65%
Makambako Resources
Limited
Subsidiary
Mineral
Exploration
Tanzania
100%
100%
Shankley Biogas Limited
Subsidiary
Power
Generation
United Kingdom
100%
100%
The Group has applied the approach whereby loans to Group undertakings and trade receivables from Group
undertakings were capitalised to the cost of the underlying investments. The capitalisation results in a decrease in the
exchange fluctuations between Group companies operating from various locations.
24. Related parties
Related parties of the Group comprise subsidiaries, joint ventures, significant shareholders, the Board of Directors
and related parties in terms of the listing requirements. Transactions between the Company and its subsidiaries,
which are related parties, have been eliminated on consolidation.
Board of Directors/ Key Management
Name
Relationship (Directors of:)
A. Lianos (resigned 2022)
River Group, Boudica Group and Namaqua Management Limited
Other entities over which directors/key management or their close family have control or significant
influence:
River Group
Boudica Group
St Anderton on Vaal Limited
River Group provide corporate advisory services and is the Company’s
Designated Advisor.
Boudica Group provides secretarial services to the Group.
St Anderton on Vaal Limited provides consulting services to the Group.
The directors of St Anderton on Vaal Limited are also directors of Mast
Energy Developments PLC.
Kibo Mining PLC is a shareholder of the following companies and as such are considered related parties:
Directly held investments:
Kibo Mining (Cyprus) Limited
Katoro Gold PLC
Indirectly held investments:
Kibo Gold Limited
Kibo Mining South Africa Proprietary Limited
Savannah Mining Limited
Kibo Nickel Limited
Katoro (Cyprus) Limited
Katoro South Africa Proprietary Limited
Kibo Energy Botswana Limited
Kibo Energy Mozambique Limited
Eagle Exploration Mining Limited
Rukwa Holdings Limited
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
83
Mbeya Holdings Limited
Mbeya Development Company Limited
Mbeya Mining Company Limited
Mbeya Coal Limited
Mbeya Power Limited
Kibo Exploration Limited
Mbeya Power Tanzania Limited
Kibo MXS Limited
Kibo Energy Mozambique Limited
Pinewood Resources Limited
Makambako Resources Limited
Jubilee Resources Limited
MAST Energy Developments PLC
MAST Energy Projects Limited
Sloane Developments Limited
Bordersley Power Limited
Rochdale Power Limited
Pyebridge Power Limited
Shankley Biogas Limited
Icon Park (Pty) Ltd
Sustineri Energy Proprietary Limited
Balances
Name
Amount (£)
2023
Amount (£)
2022
Group
Boudica Group – Secretarial services
-
27,577
River Group – Professional and legal services
-
2,500
Company
Katoro Gold Plc – recharges receivable
30,403
-
Mast Energy Developments Plc– Management and administration services
receivable
38,306
16,025
Mast Energy Developments Plc (through Kibo Mining (Cyprus) Limited)– loan
receivable
849,253
1,231,535
Transactions
Name
Amount (£)
2023
Amount (£)
2022
Group
Boudica Group – Secretarial services
-
27,577
Company
Mast Energy Developments Plc – Management and administration services
30,892
16,232
Katoro Gold Plc– Management and administration services
30,403
49,453
Directors fees (refer note 7)
-
24,366
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on
consolidation. The transactions during the period between the Company and its subsidiaries included the settlement
of expenditure to/from subsidiaries, working capital funding, and settlement of the Company’s liabilities through the
issue of equity in subsidiaries. The loans from related parties do not have fixed repayment terms and are unsecured.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
84
25. Financial Instruments and Financial Risk Management
The Group and Company’s principal financial instruments comprises trade payables and borrowings. The main
purpose of these financial instruments is to provide finance for the Group and Company’s operations. The Group has
various other financial assets and liabilities such as trade receivables and trade payables, which arise directly from
its operations.
It is and has been throughout the 2023 and 2022 financial period, the Group and Company’s policy not to undertake
trading in derivatives. Any derivative liabilities due are a result of agreements with the Group and Company’s
suppliers or financiers under its primary business goals, i.e., financing and development of renewable energy projects.
The main risks arising from the Group and Company’s financial instruments are foreign currency risk, credit risk,
liquidity risk, interest rate risk and capital risk. Management reviews and agrees policies for managing each of these
risks which are summarised below.
Foreign currency risk
The Group undertakes certain transactions denominated in foreign currencies and exposures to exchange rate
fluctuations therefore may arise. Exchange rate exposures are managed by continuously reviewing exchange rate
movements in the relevant foreign currencies. The exposure to exchange rate fluctuations for the Group/Company is
limited to foreign currency translation of subsidiaries.
At the period ended 31 December 2023, the Group had no outstanding forward exchange contracts.
2023 (£)
2022 (£)
Financial instruments of the Group are:
Financial
assets
Financial
liabilities
Financial
assets
Financial
liabilities
Financial assets at amortised cost
Other receivables
242,272
-
227,223
-
Cash and cash equivalents
64,057
-
163,884
-
Financial liabilities at amortised cost
Trade and other payables
-
3,912,223
-
2,374,704
Other financial liabilities
-
763,290
-
1,255,846
Borrowings
-
1,217,913
-
1,195,239
Financial liabilities at fair value
Trade payables – derivative liabilities
-
22,232
-
20,386
306,329
5,915,658
391,107
4,846,175
2023 (£)
2022 (£)
Financial instruments of the Company are:
Financial
assets
Financial
liabilities
Financial
assets
Financial
liabilities
Financial assets at amortised cost
Other receivables
156,114
90,720
-
Cash and cash equivalents
1,507
19,442
-
Financial liabilities at amortised cost
Trade and other payables
1,102,225
-
826,035
Other financial liabilties
-
-
657,985
Borrowings
1,217,913
-
1,195,239
157,621
2,320,138
110,162
2,679,259
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
85
Exchange rates used for conversion of foreign subsidiaries undertakings were:
2023
2022
EURO
to
GBP
(Average)
0.8765
0.8115
EURO to GBP (Spot)
0.8675
0.8866
USD to GBP (Average)
0.8074
0.8528
USD to GBP (Spot)
0.7855
0.8266
ZAR to GBP (Average)
0.0459
0.0496
ZAR to GBP (Spot)
0.0430
0.0486
The executive management of the Group monitor the Group's exposure to the concentration of fair value estimation
risk on a monthly basis.
As the Group/Company has no material monetary assets denominated in foreign currencies, the impact associated
with a change in the foreign exchange rates is not expected to be material to the Group/Company.
Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss
to the Group. As the Group does not, as yet, have any significant sales to third parties, this risk is limited.
The Group and Company’s financial assets comprise receivables and cash and cash equivalents. The credit risk on
cash and cash equivalents is limited because the counterparties are banks with high credit-ratings assigned by
international credit rating agencies. The Group and Company’s exposure to credit risk arise from default of its
counterparty, with a maximum exposure equal to the carrying amount of cash and cash equivalents in its consolidated
statement of financial position. Expected credit losses were not measured on a collective basis. The various financial
assets owed from group undertakings were evaluated against the underlying asset value of the investee, taking into
account the value of the various projects undertaken during the period, thus validating, as required the credit loss
recognised in relation to amounts owed by group undertakings.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of
counterparties having similar characteristics. The Group defines counterparties as having similar characteristics if
they are connected or related entities.
Financial assets exposed to credit risk at period end were as follows:
Financial assets
Group (£)
Company (£)
2023
2022
2023
2022
Trade & other receivables
242,272
227,223
156,114
90,720
Cash
64,057
163,884
1,507
19,442
306,329
391,107
157,621
110,162
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has built an appropriate
liquidity risk management framework for the management of the Group and Company’s short, medium and long-term
funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves
and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets
and liabilities. Cash forecasts are regularly produced to identify the liquidity requirements of the Group.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
86
The Group and Company’s financial liabilities relating to trade payables and borrowings as at 31 December 2023 were
payable on demand.
Group (£)
Less than 1 year
Greater than 1
year but within
5 years
Greater than 5
years
At 31 December 2023
Trade and other payables
3,912,223
-
-
Borrowings
1,217,913
-
-
Lease liabilities
39,826
159,304
851,812
Other financial liabilities
318,925
444,365
-
5,488,887
603,669
851,812
At 31 December 2022
Trade and other payables
2,395,090
-
-
Borrowings
1,195,239
-
-
Lease liabilities
27,000
108,000
621,000
Other financial liabilities
1,012,790
243,056
-
4,630,119
351,056
621,000
Company (£)
At 31 December 2023
Trade and other payables
1,102,225
-
-
Borrowings
1,217,913
-
-
2,320,138
-
-
At 31 December 2022
Trade and other payables
826,035
-
-
Borrowings
1,195,239
-
-
Other financial liabilities
657,985
2,679,259
-
Interest rate risk
The Group and Company’s exposure to the risk of changes in market interest rates relates primarily to the Group and
Company’s holdings of cash and short-term deposits.
It is the Group and Company’s policy as part of its management of the budgetary process to place surplus funds on
short term deposit in order to maximise interest earned.
Group Sensitivity Analysis:
Currently no significant impact exists due to possible interest rate changes on the Company’s interest-bearing
instruments.
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while
maximising the return to stakeholders through the optimisation of the debt and equity balance.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To
maintain or adjust its capital structure, the Group may adjust or issue new shares or raise debt. No changes were made
in the objectives, policies or processes during the period ended 31 December 2023.
The capital structure of the Group consists of equity attributable to equity holders of the parent, comprising issued
capital, reserves and retained losses as disclosed in the consolidated statement of changes in equity.
Fair values
The carrying amount of the Group and Company’s financial assets and financial liabilities recognised at amortised cost
in the financial statements approximate their fair value.
Hedging
As at 31 December 2023, the Group had no outstanding contracts designated as hedges.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
87
26. Events After the Reporting Period
Retirement of Directors
Ajay Saldanha and Louis Coetzee retired from the Board as directors of the Company on 10 January 2024 and 5 July
2024 respectively.
Conversion of accrued fees & interest to equity
On 11 January 2024 the Company announced the allotment of 500,000,000 new ordinary Kibo shares of €0.0001 each
to RiverFort representing conversion of accrued fees and interest totalling £161,000 forming part of the outstanding
balance of £1,106,146.72 reported by the Company owing to RiverFort under the Facility Restatement Agreement
signed on 10 April 2023. The conversion price was £0.000322 (0.0322 pence) calculated as 92% of the lowest daily
VWAP over the ten (10) Trading Days immediately preceding the date of the conversion notice in accordance with the
terms of the Facility Restatement Agreement.
Share issue to service provider in settlement of invoice
On 8 March 2024, a further 81,081,081 shares in settlement of an invoice to a separate service provider at a deemed
price of 0.037p for a total of £30,000 were issued.
Strategy Update
On 16 January 2024 the Company provided a strategy update on its bio-coal development test work as part of its
commitment to on-going sustainable clean energy solutions. It advised that it is currently formulating a joint
development agreement with a multinational food and beverage producer ("the Client") intended to be funded equally
(i.e., 50-50) by Kibo and the Client. The objective of this collaboration is to build and operate a pilot plant that will
produce bio-coal as a preliminary step towards the establishment of a comprehensive production-scale facility. This
initiative, subject to a successful pilot plant and financing, will enable the Client to transition from the use of fossil coal
to bio-coal in its comprehensive boiler fleet, without any reconfiguration, aligning with established Environmental,
Social and Governance (ESG) compliance standards. Furthermore, it noted that it has received conditional preliminary
approval for development funding, subject to due diligence, from a prominent development banking institution in
Southern Africa for one of the Company's existing waste-to-energy projects. It should be noted that Kibo no longer
has any interest in this project following the sale of Kibo Mining (Cyprus) Limited to Aria Capital Management Limited
in October 2024.
Extraordinary General Meetings
On 9 February 2024 the Company held an extraordinary general meeting where it obtained shareholder approval to
renew its ability to issue shares without applying pre-emption rights and to update its Memo & Articles of Association
to align with all authorities approved by Shareholders at previous general meetings.
On 25 July 2024 the Company held an extraordinary general meeting where it obtained shareholder approval to
increase its ordinary authorised share capital to 30 billion shares of €0.0001 each.
On 11 October 2024 the Company held an extraordinary general meeting where it obtained shareholder approval for
the sale of its wholly owned subsidiary, Kibo Mining (Cyprus) Limited to Aria Capital Management Limited.
Corporate Restructuring & Repositioning
On 7 June 2024, the Company announced a major corporate restructuring and repositioning of the Company that
included, inter alia, the conditional appointment of four new directors to the board including a new CEO and non -
executive Chairman, creditor restructuring and settlement, review of its existing energy portfolio, Option awards to
directors and a Placing for £500,000.
On 20 June 2024 the Company announced a modification to its announcement on 7 June whereby the number of new
directors to be appointed to the board was reduced from four to two, and a revised reduced placing of £340,000 by
way of new broker sponsored placing and private subscriptions.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
88
On 25 June 2024, the Company announced that it was unlikely it could meet its 30 June 2024 deadline for the
publication of its 2023 audited accounts following which it would be suspended from trading on AIM effective 7.30
a.m. on 1 July 2024 and also provided details for the admission of the new shares to be issued further to the £340,000
placing announced on 20 June 2024.
On 27 June 2024, the Company announced further changes to the placing details announced on 20 June 2024 as
regards placing amount, placing price, placees and schedule for admission of placing shares to AIM. The placing
amount was increased from £340,000 to £350,000 and at a placing price of 0.0084 pence and the issue of
4,166,666,666 new ordinary Kibo shares. (the “Placing Shares”). The entire placing amount was subscribed for by a
private investor to be settled in two tranches with 1,785,714,286 Placing Shares (Tranche 1) for a consideration of
£150,000, settling immediately and 2,380,952,380 Placing Shares (Tranche 2) for a consideration of £200,000 settling
following Kibo shareholder approval for an increase in authorized share capital of the Company at a General Meeting
to be held as soon as possible after settlement of Tranche 1; and all Kibo creditor conversions as noted in the 7 June
and 20 June RNS Announcement being settled in full. Admission of the shares to AIM was scheduled to coincide with
the lifting of the Company’s share trading suspension, such trading suspension subsequently coming into effect as
anticipated from 30 June 2024 and as announced by the Company on 1 July 2024.
On the 5 July 2024, the Company announced the stepping down of Louis Coetzee as CEO of the Company and the
appointment of Cobus van der Merwe as the Interim CEO of the Company.
On 18 July 2024 the Company announced the appointment of Clive Roberts as non-executive chairman of the
Company.
On 5 August 2024, the Company announced the completion of the creditor conversions (credit restructuring) first
announced on 7 June 2024) following shareholder approval for an increase in its authorised capital at its EGM on 25
July 2024 which was required to create sufficient authorised share headroom for the creditor conversion to be
implemented.
On 16 September 2024, the Company announced that it had signed a binding term sheet (the “Term Sheet”) with Swiss
company, ESTI AG to acquire a diverse portfolio of renewable energy projects across Europe and Africa spanning wind
and solar generation, agri-photovoltaics and technology development by way of a proposed reverse takeover
transaction. Under the Term Sheet Aria Capital Management Limited (“Aria), a global asset management company
were to be appointed as the arrange to the reverse takeover transaction.
On the 19 September 2024, the Company announced that it had signed a sale agreement with Aria Capital
Management Limited for the purchase by Aria of Kibo’s its wholly owned subsidiary Kibo Mining (Cyprus) limited
subject to shareholder approval as required under AIM Rules. Shareholder approval was subsequently obtained at a
Kibo EGM on 11 October 2024 from which date the Company was considered an AIM Rule 15 cash shell. As a cash
shell, it was noted that the Company had six months from 11 October 2024 to undertake a Reverse Takeover or
otherwise will be suspended, after which it will have a further six months to complete a Reverse Takeover or
otherwise be cancelled from trading on AIM.
On 3 December 2024, the Company announced that it had terminated the Term Sheet by mutual consent with ESTGI
AG and secured a loan facility for up to £500,000 from Aria (the “Aria Facility”). The Company noted that it had taken
this decision as it believed that it does not have sufficient time to secure all relevant information in a timely manner
necessary to complete the ESTGI AG reverse takeover particularly noting the Company will have been suspended for
6 months on 31 December 2024. The Company noted that it will now focus on completing and publishing its audited
accounts to 31 December 2023 and interim accounts to 30 June 2024 before 31 December 2024 to enable the
Company's current suspension from trading on AIM to be lifted. Following resumption of trading, the Company noted
that it will seek an alternative project portfolio to proceed with a revised transaction (the “Revised Transaction”) and
that it is already evaluating a number of project acquisition opportunities.
The Aria Facility is to provide the Company with working capital for the next four months (to 31 March 2025) until it
is able to identify and complete a Revised Transaction.
The Company also announced that it had also signed a Deed of Amendment to the terms of its outstanding loan facility
with River Global Opportunities PCC limited (the “RiverFort Loan”). The terms of the RiverFort Loan required
RiverFort’s consent for the Company to enter into another loan facility with another institution.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
89
These measures summarised above amount to a business re-set for the Company where it intends to move ahead
under the stewardship of the reconstituted board by transitioning Kibo to a broader based energy company,
Disposal, loss of control and deconsolidation of Mast Energy Developments
On 6 June 2024, the Company entered into an agreement with Riverfort Global Opportunities in which it ceded its
loan with Mast Energy Developments Plc (MED) through its subsidiary Kibo Mining (Cyprus) Limited to Riverfort in
partial settlement of its loan with Riverfort. The loan with Riverfort Global Opportunities and a transaction date
balance of £767,205 was reduced to £400,000 in exchange for the cession of the £797,396 loan receivable from MED.
The loan receivable from MED was payable on demand and was historically partially settled with shares issued in
MED. The directors considered the loan and historic precedent of conversion thereof as part of their assessment on
control over MED in terms of IFRS 10.
The directors determined that the combined factors of significant reduction in shareholding in MED during the 2024
year, and the disposal of the loan receivable from MED and resulting convertibility of the loan through shares issued,
resulted in loss of control of MED with effect from 7th of June 2024. From this date onwards MED was recognised as
an associate and equity accounted until the investment in MED was disposed of in full on the 30th of September 2024.
MED’s contribution to 31 December 2023’s Balance Sheet and Profit and Loss is summarised as follows:
Group
2023
(£)
MED
Contribution
2023
(£)
Unconsolidated
Group
2023
(£)
Assets
4,158,362
(2,569,419)
1,588,943
Equity
(2,144,659)
(464,744)
(2,609,403)
Liabilities
(6,303,021)
2,104,675
(4,198,346)
Loss for the year
(5,715,341)
3,539,394
(2,175,947)
As a result of the investment in MED being reclassified as an associate and the Group accounting policy of investments
in listed associates being measured at fair value of the shares at market value, the Group expects impairments and
gains on disposals of MED shares to amount to £12,482 and £268,497 respectively in its 30 June 2024 interim results.
The gain on disposal is as a result of the proceeds from share disposals and the recovery of loan and fair value of the
retained MED shares exceeding the net asset value thereof on disposal date.
The retained investment in MED was disposed of in September 2024 to Riverfort for £120,074.
Disposal of investment in Kibo Energy Botswana Limited
The Group disposed of its interest in Kibo Energy Botswana Limited on 31 January 2024 to Aria Capital Management
Limited for an amount of £70,000. The shareholding of Shumba Energy Limited did not form part of this agreement
and was transferred to Kibo Energy (Cyprus) Limited (KMCL) pending secretarial finalisation. The transfer was
completed in September 2024. The value of Kibo Energy Botswana Limited was represented by the investment in
Shumba Energy Limited of £307,725. As Kibo Energy Botswana was held at a £Nil balance the group expects a profit
on disposal of £70,000 in its 30 June 2024 interim results.
Disposal of investment in Kibo Mining (Cyprus) Limited
The Group disposed of its interest in Kibo Mining (Cyprus) Limited (KMCL) and its subsidiaries on 16 September 2024
for £Nil; the disposal did not include MED which contributed £1,902,936 of the carrying value of KMCL of £2,210,661
as at 31 December 2024. The disposal of the remaining carrying value of £307,725, represented by the investment in
Shumba, will result in a loss on disposal of £307,725 of Kibo for the 2024 year.
The disposals above came about after the restructuring process initiated in 2024.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
90
27. Commitments and Contingencies
Benga Power Project
Kibo entered into a Joint Venture Agreement (the ‘Benga Power Joint Venture’ or ‘JV’) with Mozambique energy
company Termoeléctrica de Benga S.A. to participate in the further assessment and potential development of the
Benga Independent Power Project (‘BIPP’).
In order to maintain its initial participation interest Kibo is required to ensure funding of a maximum amount of £1
million towards the completion of a Definitive Feasibility Study, however this expenditure is still discretionary.
Other than the commitments and contingencies noted above, the Group does not have identifiable material
commitments and contingencies as at the reporting date. Any contingent rental is expensed in the period in which it
incurred. It should be noted that that the Group disposed of its interest in the Benga Power Project through the
disposal of the Company’s Cyprus subsidiary, Kibo Mining (Cyprus) Limited, on 11 October 2024.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E
KIBO ENERGY PLC
ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
91
Annexure 1:
Headline Earning Per Share
Headline earnings per share (HEPS) is calculated using the weighted average number of ordinary shares in issue
during the period and is based on the earnings attributable to ordinary shareholders, after excluding those items as
required by Circular 1/2022 issued by the South African Institute of Chartered Accountants (SAICA).
Reconciliation of Headline earnings per share
Headline loss per share
Headline loss per share comprises the following:
Reconciliation of headline loss per share:
31 December
2023 (£)
31 December
2022 (£)
Loss for the period attributable to normal shareholders
(3,854,280)
(9,776,917)
Adjustments:
Profit on disposal of PPE
(6,424)
(7,264)
Impairment of intangible assets
2,258,774
3,229,155
(Reversal of) / Impairment of associates
(429,102)
3,809,774
Impairment of property, plant and equipment
459,700
-
Headline loss for the period attributable to normal shareholders
(1,571,332)
(2,745,252)
Headline loss per ordinary share
(0.0004)
(0.0009)
Weighted average number of shares in issue:
3,568,946,718
3,010,992,501
In order to accurately reflect the weighted average number of ordinary shares for the purposes of basic earnings,
dilutive earnings and headline earnings per share as at year end, the weighted average number of ordinary shares
was adjusted retrospectively.
Docusign Envelope ID: 1CDF54B6-D500-47A8-971D-C3AC05D5EA5E