ANNUAL REPORT & ACCOUNTS 2022
Metal Tiger plc
Annual Report & Accounts 2022
1
CONTENTS
2
STRATEGY AND PERFORMANCE
2
Chairman’s Statement
4
Chief Executive Officer’s Commentary
8
Strategic Report
25
STRATEGY AND PERFORMANCE
25
Chairman’s Corporate Governance Statement
26
Board of Directors and Committees of the Board
30
Compliance with the QCA Code of Practice
32
Compliance with ASX Corporate Governance Principles and Recommendations
34
Report of the Directors
36
INDEPENDENT AUDITOR’S REPORT
42
FINANCIAL STATEMENTS
42
Consolidated Statement of Comprehensive Income
43
Consolidated and Company Statements of Financial Position
44
Consolidated and Company Statements of Cash Flows
45
Consolidated Statement of Changes in Equity
46
Company Statement of Changes in Equity
47
Notes to the Financial Statements
75
COMPANY INFORMATION
Metal Tiger plc
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Annual Report & Accounts 2022
I am pleased to present the Group’s Annual Report
and Audited Financial Statements for the year ended
31 December 2022.
The past year has been challenging due to the COVID-19
pandemic and the global economic uncertainty caused by
the war in Ukraine. Metal Tiger has taken steps to address
these challenges by preserving its cash reserves and
managing its cost base. Nonetheless, we remain focused
on our key strategy of making the right longer-term
investment decisions, both individually and in the context
of our portfolio as a whole. We believe that it is important
for executive management and the Board as a whole to
continue to add value to investments when the opportunity
arises, while also remain well positioned to capture future
value in both the existing portfolio and new investments.
The Company was in a favorable position starting in
2022, with a strong and liquid balance sheet thanks
to its performance in the 2019, 2020 and 2021
financial years. The ability to access capital markets
based on its shareholding in Sandfire Resources
Limited (“Sandfire”) was a significant factor. Due to
the challenges in the commodity space mentioned
above, the Board exercised prudence by limiting the
number and size of investments versus previous
years. As communicated by the Company last year, no
additional active investments were added to our current
holdings of Cobre, Armada and Southern Gold. Further
information on the investment portfolio’s performance
and composition is detailed in the Strategic Report.
The Company has successfully disposed of its last
project investment by selling the remaining 49% stake
it held in Kalahari Metals Limited (“KML”). Although the
Company incurred a loss of £833,000, this move allowed
the Company to have a more predictable cash burn
outlook while still maintaining a significant exposure
to the project through Cobre Limited, as well as the
company’s 2% Net Smelter Return (“NSR”) over most
of KML’s license areas. This will enable the Company
to transition to an almost exclusively investment and
royalty owing company. The Projects Investment Section
provides more details about the disposal its effects.
While admission to AIM has generally served the Company
well, the Board believes that it will not be possible to
implement an efficient trading strategy in the future due
to the approval process required for certain investments.
The Board carefully explored the possibility of applying
for admission of the Shares to trading on the Specialist
Fund Segment of the Main Market of the London
Stock Exchange. However after discussions with the
Company’s professional advisers, it became clear that
such a move was not viable at this time. Therefore, the
Board has determined that it is in the best interests of
the Company and Shareholders to proceed with the AIM
Cancellation without applying for admission of the Shares
to trading on any other market in the United Kingdom.
However, the Company will retain the admission
of the Shares to listing and trading on the ASX. The
Board believes that this will give the Company greater
flexibility to manage its portfolio, implement the new
investing policy which was approved by Shareholders
at the General Meeting (the “New Investing Policy”) and
position it better to pursue and achieve its investment
objectives in the future by being able to trade in a more
efficiently. The New Investing Policy will also provide
flexibility to pursue “Complementary Investments”.
CHAIRMAN’S STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
Metal Tiger plc
Annual Report & Accounts 2022
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The operating loss for the year was £8,627,000 primarily
due to the performance of the investment portfolio with
losses from disposals and fair valuing of investments
amounting to £5,110,000 during the year, coupled
with the loss incurred from disposing of KML.
The Board believes it is prudent and appropriate to wait
for updates on the size of Sandfire’s A4 Copper/silver
Mineral Resource before revaluing the Company’s 2%
net smelter return (“NSR”). The revaluation in 2021 was a
significant contributor to the Company’s results. The key
assumptions used in testing the value of the Royalty are
contained in Note 17 of the Annual Financial Statements.
Expense and cost management remain a key focus of the
Board. However, during the year, there were corporate
legal costs £437,000 during the year up from £125,000
in the prior year predominately incurred to register as an
small UK AIFMs (“AIFMs”) under the Alternative Investment
Fund Managers Regulations 2013 (“AIFMRs”). There were
also costs in assessing the potential move from the
AIM market of the London Stock Exchange (“AIM”) to
the Specialist Fund Segment of the Main Market (“the
SFS”). While the Board anticipates corporate legal costs
in 2023, these are necessary to ensure the Company’s
compliance with the Regulators and strategic direction.
It is also important that the Company is housed on the
appropriate exchange to achieve its strategic goals.
Looking to the future, the Board will focus more on larger
investments in advanced resource definition/ development
stages, alongside traditional high conviction earlier stage
investments with a medium to long-term investment
timeframe, where Board representation is possible.
On the less active front, the Board has nearly exited all
of its legacy positions and will diversify into shorter/
medium term, lower-risk investment opportunities to
balance risk profiles against earlier stage investments.
It is important to highlight that our Company’s main
strategy is to make sound longer-term investment
decisions, considering not only their individual merits,
but also their impact in the context of the wider market
as a whole. A significant challenge we face is finding
suitable investments that align with our strategy. We
are constantly looking for opportunities, whether that
means making new investments, divesting existing ones,
or both, in order to create value for our shareholders.
The COVID-19 pandemic and ongoing conflict in
Ukraine have affected the immediate value of our
investment portfolio. While this may limit our ability
to make new investments in the short-term, it also
presents opportunities for further strategic investment
if appropriate. For further details of our response to the
current situation, please refer to the Strategic Review.
I would like to express my gratitude to Mark Potter,
Chief Investment Officer, and Neville Bergin, Non-
Executive Director, for their dedication and contributions
to the company over the last four to five years. Their
professionalism and guidance have been invaluable
to the development of Metal Tiger. I would also like to
take this opportunity to thank all of our shareholders,
business partners, and staff for their ongoing as
we continue to grow and evolve as a Group.
Charles Hall
Chairman
29 March 2023
Diamond drill rig in transit over Cobre’s
Ngami Copper Project, Botswana.
Metal Tiger plc
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Annual Report & Accounts 2022
I am pleased to present the audited results for the
year ended 31 December 2022. Alongside the financial
statements and supporting notes, a full review of
business activities during the year is provided within
the Strategic Report.
2022 was undoubtedly a challenging year, with several
market shocks. There were difficult macro trends driven by
a sharp global growth slow-down, which led to concerns
about a potential global recession. Inflation pushed up
costs, especially related energy. Rising interest rates,
liquidity pressure driven by an overall market sell-off,
COVID-19 restrictions in China, supply chain disruptions,
and geopolitical tensions between the East and West
also contributed to the uncertainty. The ongoing Russo-
Ukraine war added to the tension. Commodity prices,
with few exceptions, fell significantly from their peaks
(at least in US dollar terms), and currency depreciations
drove up domestic commodity prices in some countries,
especially in emerging markets and developing countries.
Energy prices went up due to aggressive natural gas
purchases by several European countries, but these prices
decreased towards the end of the year as inventories filled
and consumers reduced their consumption in response to
higher prices and warmer-than-usual weather. Declining
copper and zinc prices put pressure on Sandfire Resources
Ltd (“Sandfire”) MATSA operations in the Iberian Pyrite
Belt in Spain. As a result, in November 2022, Sandfire
conducted a fully underwritten entitlement offer, with the
proceeds to be used to repay one of its ANZ Corporate
Debt facilities as well as to fund increased working capital
for the construction and ramp up of its Motheo Copper
project in Botswana. Energy prices have since subsided
and are expected to ease through 2023 and 2024.
Government
Although there may be increased volatility in 2023, as we
have seen in the past 12 months, it is still arguable that we
are in a commodity super cycle as of the end of 2022.
Starting in March 2022, the Federal Reserve raised the
federal funds rate seven times in 2022, with a year-end rate
of 4.25% to 4.50%, and is expected to continue with smaller
increases throughout 2023. This has caused a decline in
metal prices due to increased cost of carrying inventories.
In 2022, Metal Tiger’s largest commodity exposure, through
its equity and now defunct project investments, was to
copper and gold. In 2022, copper prices were very volatile
with the price peaking in March before dropping on the
back of various macroeconomic factors in Chile and the
Fed announcing a March interest rate rise. Prices eventually
dropped below US$3/lb in July due to fear of a protracted
zero-COVID policy in China and further lockdowns, as well
as further Fed rate increases. Prices then stayed largely
suppressed, but Chile’s rejection of a new constitution
helped to support prices. In November, the copper price
was squeezed and closed the year at around US$3.81/lb
amid concerns regarding supply from Peru following civil
unrest and President Pedro Castillo’s removal from office,
and renewed optimism regarding reopening in China, which
accounts for about 50% of global copper consumption.
Goldman Sachs forecasts that “green demand” will
account for 68% of total demand growth in China in 2023,
offsetting continued weakness in the property sector.
In March 2022, Russia’s invasion of Ukraine caused gold
prices to increase by 13% from January, as investors sought
a safe-haven asset. However, this spike was short-lived
due to headwinds from a strong US dollar and the Federal
Reserve’s stance on inflation. In Q2 2022, surging costs
due to inflation saw an average all-in sustaining cost reach
a record high of US$1,289/oz. In Q3 2022, the surging US
CHIEF EXECUTIVE OFFICER’S COMMENTARY
FOR THE YEAR ENDED 31 DECEMBER 2022
Copper oxide veining Forest Road Samsun area - Southern Gold
Metal Tiger plc
Annual Report & Accounts 2022
5
dollar, along with seasonal weakness, saw the gold price
hit a low of US$1,691/oz. Gold ended the year at US$1,824/
oz. Nonetheless, annual gold demand in 2022 was very
high, aided by sizeable central bank purchases, strong retail
demand and slower ETF outflows. Gold supply increased
by 2%, and full-year mine production grew by 1%.
In July, the US enacted the Inflation Reduction Act, which
provided US$369 billion worth of tax breaks and subsidies
to support green technology and energy security in the
country. This move was viewed positively by the mining
sector and the global energy transition, but it was largely
inward-facing in terms of policy. It is widely anticipated
that Europe will implement similar pro-energy transition
legislation in 2023 to maintain competitiveness.
The cost of battery grade lithium carbonate has skyrocketed
from US$8,000 per tonne to over US$70,000 per tonne
since 2020. Lithium prices continue to remain strong, a
trend that is expected to continue for the foreseeable future,
with supply expected to remain tight amid bullish demand
from the accelerating adoption of electric vehicles (“EV”)
across the globe. Towards the end of 2022 and early 2023,
there was a slight decrease in the outlook for lithium, which
was led by a slowdown in the Chinese EV market. However
major EV manufacturers like Tesla have proactively lowered
the pricing of their electric cars to stimulate higher demand.
With increasing adoption of EVs, some industry experts
are forecasting that the gap between lithium demand and
supply will either remain the same or possibly widen in
2023. This supply-demand imbalance is expected to grow
even more over the coming decade. Fortunately, there
are many new lithium mines currently in development,
with over 60 new greenfield projects, and 7 brownfield
expansions, which will help alleviate some of the short-
term supply-side deficits in the coming years.
The prevailing market consensus view is that lithium
prices will remain at elevated levels for the next few
years, subject to EV demand remaining robust.
In 2022, the investment in decarbonising energy surpassed
US$1 trillion for the first time. This represented an increase
of more than US$250 billion from 2021, the largest jump
yet. According to Goldman Sachs, the EV sector remains
one of the four key drivers of future demand growth for
copper. Interestingly, EV sales grew by approximately 36%
in 2022 compared to the previous year. It is anticipated that
public infrastructure spending in China will remain strong
in 2023, supporting a recovery in Chinese GDP growth. As
for copper, Goldman Sachs expects that “green demand”
will account for 68% of total growth in China in 2023,
offsetting continued weakness in the property sector.
In late 2021, The Company decided to take up its rights
in Sandfire’s entitlement offer as part of its acquisition
of MATSA. To accomplish this, an A$9m margin lending
facility agreement was entered into in October 2021
with a nominee of SC Lowy Primary Investments Ltd
secured against 4,714,286 Sandfire shares held under a
tripartite sponsorship deed with an Australian broker.
Metal Tiger plc
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Annual Report & Accounts 2022
CHIEF EXECUTIVE OFFICER’S COMMENTARY
FOR THE YEAR ENDED 31 DECEMBER 2022
In June 2022, Metal Tiger announced that it had entered
into a transaction with Cobre Limited (“Cobre”) to dispose
of its interests in Kalahari Metals Limited (“KML”), thus ending
direct expenditure on exploration at a JV or project level
and essentially marking the end of the Project Investments
division of the Company. Cobre acquired all outstanding
debt and MTR’s remaining 24.5% interest in KML in exchange
for new shares in Cobre. While Metal Tiger no longer
supports the project directly, it opted to continue to support
Cobre by investing approximately A$1.47m in their A$7.0m
fundraise in August 2022, to maintain its pro-rata interest.
In December 2022, Metal Tiger agreed to invest a further
A$1m in support of highly encouraging exploration results
from Cobre’s successful drilling campaign and additional
exploration work. This second investment was subsequently
approved by Cobre shareholders on 24 March 2023.
In December 2022, Cobre announced that it had signed
a collaboration agreement with a subsidiary of Sandfire
to procure Airborne Gravity Gradient data over its Ngami,
Kitlanya West and Kitlanya East Copper Projects in
Botswana, with the costs to be split equally between Cobre
and Sandfire. Cobre, via KML, has completed 7,750m of
drilling. Out of 28 holes drilled on the Ngami Copper
Project (“NCP”), 27 intersected the target mineralised
contact. Assay results from discovery hole NCP20A
drilled into the Comet target confirmed visual copper
estimates and delineating a 30m zone (downhole) of
chalcocite mineralisation grading 1.25% Cu and 17 g/t Ag.
This same intersection includes an exceptional 1.7m at
10.9%Cu and 45g/t Ag from 155.3m to 157m downhole.
Over 5,000 historical soil samples combined with
1,634 new samples were analysed with partial leach
geochemistry, which has proven successful in defining
several new targets in addition to Comet at NCP. 5,359
soil samples were collected on the Kitlanya West Project
located immediately west of NCP. In addition, a 25km2
Natural Source Audio-Magnetotelluric NSAMT orientation
study was completed, along with a 500-sample ionic
leach test survey both aimed at providing new ways to
vector into high grade zones within the targets at NCP.
The Board is pleased with the methodical approach
by Cobre to unlock the value of their tenements, but
equally notes that this is being achieved with substantial
capital having been raised in the last 12 months. From
a positive market perspective, Cobre has consolidated
nearly 100% ownership of KML’s tenements, which
means it is in a far stronger negotiating position for spin-
outs, joint ventures, or farm-ins with third parties.
In late May 2022, the Company made its second
strategic move by applying to the UK Financial
Conduct Authority (“FCA”) to be registered as a small
Alternative Investment Fund Manager (“AIFM”). After
a thorough round of questioning from the FCA, and
with the assistance of its legal counsel, Metal Tiger was
successfully entered into the register of small registered
UK AIFMs, effective as of 17 November, 2022.
On 18 November 2022, following a copper price squeeze,
Sandfire announced an entitlement offer to raise A$200
million at A$4.30 per share. Metal Tiger exercised its pre-
emptive rights in the entitlement offer and disposed of 1.3
million SFR shares, while also reducing the loan balance
on the previous Margin Lending Facility. On 14 December
2022, Metal Tiger replaced its previous Margin Lending
Facility with a new A$15m Margin Lending and Drawdown
Facility with a sub-fund of SC Lowy SI II (SG) VCC. The
drawdown was partly used to repay the A$7m loan against
1,675,125 Sandfire shares at an effective put entry price. This
resulted in Metal Tiger’s position being 5,012,626 Sandfire
shares against an A$8.345m loan balance, with the ability to
drawdown a further A$6.65m to either purchase Sandfire
shares in the market or to settle loans outstanding against
the 1,167,542 SFR shares secured under the equity derivative
financing arrangement with a global investment bank. In late
December 2022, Metal Tiger opted to sell a further 250,000
Sandfire shares at A$5.38 per share, reducing the outstanding
loan balance to A$7.7m. While Sandfire is a medium-term
position for the Company, the Board is exercising more
caution regarding selling discipline and general risk exposure.
During the course of 2022, Metal Tiger was less active in
seeking and making new investments than it has been in
previous years. Passive investments totalled £3,928,000
for the year, down from £6,137,000 the year before. This
was largely as a result of the situation explained above.
Despite these difficulties, the Board made several
decisive moves in a transitional and challenging
2022 in order to establish a foundation for the future
growth and strategic ambitions of the Company.
Samsun vein
Metal Tiger plc
Annual Report & Accounts 2022
7
In November 2022, the Company began considering a
move from AIM to the Specialist Fund Segment of the LSE.
This was done to better enable the Company to meet its
investment objectives and maintain a UK listing for the
benefit of shareholders. Unfortunately, in February 2023,
following discussions with the Company’s professional
advisers, it became clear that such a move was not viable at
this time. As such, the Board made the difficult decision to
delist from AIM in order to meet its investment objectives.
Shareholder approval was sought and subsequently received
for a new investing policy to better enable the company to
meet its future investment objectives.The Company notes
that the new investing policy had initially been intended
to come into effect on the move from AIM to the SFS.
Additionally, the Company will also change its name to
Strata Investment Holdings plc as part of the transition.
I would like to place on record my thanks to the team
members, both new and former, at Metal Tiger, as well
as our co-directors and advisers, who have all worked
tirelessly to bring the Company to its current strong
position. Additionally, I would like to thank Mark Potter
and Neville Bergin for their years of service to the
Board. I wish them the well in their future endeavors.
Diamond Drilling at the Ngami
Copper Project, Botswana.
Finally, and most importantly, I would like to thank
shareholders for their continued support during a
challenging year. Although changes were necessary, we
are confident that the Company is now better positioned
to achieve its investment objectives. We believe that
the transition will be fruitful and are optimistic that the
concentration of risk in some of our larger investments
will ultimately pay off as we work towards aligning the
portfolio with our new investing policy over time.
Michael McNeilly
Chief Executive Officer
29 March 2023
Metal Tiger plc
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Annual Report & Accounts 2022
PROJECT INVESTMENTS
The Project Investments segment includes investments
into mineral exploration and development projects
either through subsidiaries, associates or joint venture
companies, operated by in-country partners who have the
requisite knowledge and expertise to advance projects.
This segment will no longer form a part of the Company’s
strategy going forward following the disposal of Kalahari
Metals Limited to Cobre Limited.
BOTSWANA
Kalahari Metals Limited
As announced on 30 November 2022, the company
completed the Sale of its remaining 49% interest in KML
to Cobre. Whilst Metal Tiger suffered a disposal loss of
£833,000 there is considerably more liquidity in Cobre
shares and the projects are now within a vehicle with a
diversified shareholder base with a considerable amount
of capital to spend on exploration to drive the value from
the projects. Metal Tiger maintains an uncapped 2% NSR
royalty over Kitlanya East and Kitlanya West project areas.
The Company is pleased to note that Cobre’s 2023 plans
currently include exploration activities and planned drilling
on the Kitlanya West project
This segment will no longer form a part of the Company’s
strategy going forward following the disposal of Kalahari
Metals Limited to Cobre Limited. Metal Tiger retains a
significant interest in Cobre Limited. The rationale for
winding down this division as well as selling Kalahari
Metals Limited, is due to several factors. Most importantly,
the Board views Kalahari Metals as a legacy investment
and that funding exploration costs does not match with
the objectives and requirements of being an investing
company especially relative to the Company’s asset
base. For example, post Cobre’s acquisition (partial and
complete) of Kalahari Metals Limited, Cobre Limited has
raised circa A$15m before costs to advance exploration in
the Kalahari Copperbelt. In a 3-year period, Metal Tiger has
only raised A$5m before costs.
THAILAND
Metal Tiger retains twelve exploration licence applications
in Thailand which have been fully progressed at the
relevant permitting body, the Department of Primary
Industries and Mines, and to the Company’s knowledge
as at the date of publication of these accounts, remain
in good standing. Should these exploration licence
applications be granted, and confirmation of such is
awaited, the Board will consider whether or not to pursue
appropriate exploration programmes.
The carrying value of Thailand has been written off at the
Company level and the licence applications are held at
immaterial amounts within Metal Tigers subsidiaries in
Thailand (“Thai Group”). Going forward the Thai Group
will increasingly serve as a shared services provider to
Group companies.
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
RESULTS
The results of the Group for the year ended
31 December 2022 are set out the Consolidated
Statement of Comprehensive Income and show a
loss before taxation for the year ended 31 December
2022 of £6,678,000 (2021:profit £4,215,000).
The net asset value of the Group reduced to £31,973,000
from £38,822,000 in 2021, being 18.9p per share from
22.9p per share in 2021 on a fully diluted basis.
REVIEW OF THE BUSINESS
DURING THE YEAR
The Group’s operations are carried out within
two segments for reporting purposes.
The Project investments segment includes investments
into mineral exploration and development projects
either through subsidiaries, associates or joint venture
companies, operated by the Group’s in-country partners
who have the requisite knowledge and expertise to
advance projects. The sale of KML will henceforth do
away with this segment as a reporting Segment.
The Equity Investments segment includes both
strategic investments (often Active) and investments
which are part of the on-market portfolio (often
Passive). Strategic investments are those where Metal
Tiger seeks to positively influence the management
of investee companies to enhance shareholder value.
The on-market portfolio consists of investments in
listed mining equities and warrants where the Board
believes the underlying investments are attractive. The
Company seeks to make capital gains both in the
short and long term as a result of market mispricing
or an increase in underlying commodity prices.
The following sections of the review cover the
operations of both segments during the year, the
Group’s general investment policy and central operations
including administrative costs and working capital.
Metal Tiger plc
Annual Report & Accounts 2022
9
EQUITY INVESTMENTS
The Equity Investments segment continues to invest in high
potential mining exploration and development companies
with a preference for base and precious metals. The focus
is to invest in mining companies that are significantly
undervalued by the market and where there is substantial
upside potential through exploration success and/or
development of a mining project towards commercial
production. To differentiate between the Board’s view of
each company’s strategy we categorise certain investments
as either Active or Passive.
Active investments are typically larger investments where
Metal Tiger seeks to positively influence the management
of investee companies, by providing oversight and
guidance at Board level to enhance shareholder value and
minimise downside risk. The investments that fall within this
category include Cobre, Southern Gold and Armada. The
Board continually evaluate the active investment portfolio,
and accordingly this may change in composition in the
future. No new Active Investments were added to the
portfolio in 2022. Furthermore the Board does not expect
to make further additions to the active investment portfolio
in the near future.
Metal Tiger invests in listed mining equities via either
initial public offering (“IPO”), pre-IPO equity placings,
or direct on-market share purchases. Metal Tiger
may receive warrants when undertaking investments
in pre-IPO, IPOs, or equity placings. The Company
may consider other investment structures. The main
aim is to make capital gains in the short to medium
term. Investments are considered individually based
on a variety of criteria. Investments are typically stock
exchange traded on the TSX, ASX, AIM or LSE but can be
private with a view to obtaining a liquidity event.
As at 31 December 2022, as set out in the table below,
Metal Tiger had equity investments in companies pursuing
high potential exploration and development projects in
precious, base and battery metals. Projects are located in
a variety of jurisdictions, including North America, South
America, Africa, South East Asia and Australia. Metal Tiger
held some exposure to producers.
Through its investments, Metal Tiger is primarily exposed to
copper and gold.
During 2022 the gold price fell approximately 2% year-
on-year, driven by pressure from US dollar strength.
Rising interest rates and a stronger US dollar as well as
the expectation of continued hawkish US Federal Reserve
policy put a cap on the gold price for most of 2022 in spite
of increased investor demand for gold from central banks
globally as well as investors seeking a safe-haven asset in
light of the Russo-Ukraine war.
Metal Tiger continues to deliver on identifying high
conviction natural resource opportunities in line with its
investment approach. Whilst the Company continued to
largely focus on undervalued investment situations with the
potential for substantial exploration upside, the Company
still managed to maintain a strong level of diversification in
the Passive Investment portfolio in terms of commodity,
jurisdiction and project development stage. In addition,
Metal Tiger has managed to increase its warrant portfolio
through investments in the year.
Armada’s team in the core shed in Gabon.
Metal Tiger plc
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Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
EQUITY INVESTMENTS (continued)
Key events during 2022
During the period 1 January to 31 December 2022, net
assets in the Equity Investments segment decreased
to £24,565,000 from £35,524,000 and reported a loss
of £5,071,000 before finance and administrative costs.
This was primarily driven by the decrease in value of the
Company’s investments in Sandfire together with the
decreased dividend of £146,000 from £1,538,000 also
primarily from its holding in Sandfire, which is also included
in the above loss for the segment. The segment made an
aggregate of 22 separate investments in 2022 and fully
or partially exited from all of those positions. It should be
noted that in some positions Metal Tiger exited and re-
entered positions.
The Company’s largest equity investment as at 31
December 2022, was a 1.9% equity interest (5,930,168
ordinary shares) in Sandfire, valued at £18,162,187. Sandfire
Resources is an international and diversified sustainable
mining company listed on the Australian Securities
Exchange (ASX). In October 2022, Sandfire mined the
final stope of ore from its DeGrussa Copper Operations
in Western Australia, located 900km north of Perth.
This concluded more than 10 years of highly successful
production at one of Australia’s premier copper-gold mines.
Having replaced this cornerstone asset in 2021, Sandfire
now operates the MATSA Copper Operations located in
the Huelva Province of south-western Spain in the northern
portion of the Iberian Pyrite Belt. MATSA is a substantial
polymetallic mining operation comprising a 4.7Mtpa central
processing facility that sources ore from three underground
mines, Aguas Teñidas and Magdalena Mines in Almonaster
la Real and the Sotiel Mine in Calañas, producing copper,
zinc and lead mineral concentrates that are shipped from
the port of Huelva. Sandfire also has development and
exploration projects in North America and Botswana as
well as exploration projects in Australia.
Ariel image over Cobre’s district
scale projects in Botswana
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Annual Report & Accounts 2022
11
A selection of key Sandfire developments in 2022 include:
• Sandfire achieved copper production of 109,835
tonnes of copper, 97,732 tonnes of zinc, 10,977 tonnes
of lead, 10,977 ounces of gold and several million
ounces of silver in 2022 from DeGrussa and MATSA
operations with C1 cash costs increasing during the
period. Sandfire conducted successful plant-scale
trials on processing oxide stockpiles confirming the
opportunity to extend processing up to June 2023.
Equally, Sandfire initiated a formal sale process for the
DeGrussa Copper Operations and related exploration
tenure in Western Australia.
• Sandfire conducted a global exploration campaign with
rigs being active throughout most of 2022 in Spain as
well as the Kalahari Copperbelt. On 20 October 2022,
Sandfire announced extensive structurally controlled
copper-silver mineralisation over a 1.8km strike length
at the A1 Dome, 20km from the Motheo Copper mine.
Highlights from the drilling included holes with 11.5m
@ 2.0% Cu and 9g/t Ag from 130.5m; 8m @ 1.6% Cu
and Cg/t Ag from 120m and 15m @ 1.4% Cu and 20g/t
Ag from 135m. (This area is covered by Metal Tiger’s
uncapped 2% NSR).
• Sandfire published an updated Measured, Indicated
and Inferred Mineral Resource Estimate (MRE) being
completed for the MATSA Copper Operations showing:
147.2Mt at 1.4% Cu, 3.0% Zn, 1.0% Pb and 39.6g/t Ag,
containing an estimated 2.1Mt of copper, 4.4mt of zinc,
1.5Mt of lead and 187.6Moz of silver.
• Sandfire published an updated Ore Reserve Estimate
for MATSA totalling 37.1Mt at 1.6% Cu, 2.6% Zn, 0.8%
Pb and 36.1g/t Ag containing an estimated 593kt of
copper, 975kt of zinc, 286kt of lead and 43.0Moz of
silver with an estimated Net Smelter Return (NSR)
of US$116/t (using an NSR cut-off). The Proved Ore
Reserve Estimate increased by 41% to 26.2Mt at 1.7% Cu
and 2.7% Zn.
• Karl Simich announced his resignation as Managing
Director and CEO after 15 years at the helm of Sandfire.
On 10 November 2022, Sandfire announced that it
had appointed Brendan Harris as CEO and Managing
Director, to start in early April 2023. Jason Grace is
acting as Chief Executive Officer in the interim period.
• Construction of the 3.2Mtpa Motheo Copper Mine in
Botswana progressed largely on schedule and is due
for wet commissioning and then first ore to the plant in
Q1 2023. Completed a US$140m project finance facility
with Nedbank and Société Generale.
• In August 2022, announced a positive definitive
Feasibility Study “DFS” for the 5.2Mtpa processing
operation, mining both the T3 and A4 Deposit which
gave a pre-tax NPV7% of US$548m and an IRR of 29%
using metal prices of Cu US$3.57/lb, Ag US$20/oz
and a 10-year mine life and peak production of 55ktpa
copper-in-concentrate with a strip ratio of 6.2 waste to
ore. LOM production 440kt Cu and 18.4Moz Ag with
LOM all-in sustaining costs of US$1.79/lb. Initially A4
development and plant expansion was budgeted as an
additional circa US$72m. In the report first production
at A4 was anticipated in the December Quarter of
FY2025. The Board of Metal Tiger believes that there is
an opportunity for these timelines to be advanced such
that A4 timelines are progressed faster noting of course
that the main factors are around environmental permits
and the obtention of a mining license.
• On 18 November 2022, Sandfire announced a fully
underwritten entitlement offer to raise A$200m at
A$4.30 per share to help strengthen Sandfire’s balance
sheet, providing enhanced financial flexibility and
ensuring that the company remains well funded to
progress its ongoing strategic growth initiatives and
exploration across its portfolio. The use of proceeds
was used to pay down some of the ANZ Corporate
Debt Facility, strengthen the balance sheet and
working capital position as well as support execution
in growth and exploration projects, including MATSA
mine extension and drilling and ore reserve growth,
Motheo A4 progress including approvals and design
and Kalahari copper belt near mine exploration,
including further A1 drilling.
• On 1 November, Sandfire’s 87% owned subsidiary,
Sandfire Resources America Inc. announced that
the necessary permits to appropriate water for the
Black Butte Copper Project have been issued by the
State of Montana Department of Natural Resources
and Conservation (DNRC). While the Company
received objections to the water use permits and the
mitigation changes, the Company was able to resolve
all but one of the objections through negotiated
settlements, which may not be challenged as agreed
upon by the parties. The one remaining objection to
the groundwater permit, which is pending before the
Meagher County district court relates to the DNRC’s
interpretation of whether mine dewatering constitutes
“waste” under the Montana Water Use Act.
Metal Tiger plc
12
Annual Report & Accounts 2022
EQUITY INVESTMENTS (continued)
Other material equity investments as at
31 December 2022, include:
Active Investments:
Cobre Limited (“Cobre”)
Cobre is an ASX listed (ASX:CBE) is a copper exploration
growth company with prospective projects in Botswana and
Western Australia together with two strategic investments.
The Company held 46,989,136 ordinary shares representing
20.58% of the issued ordinary share capital of Cobre as at
and valued at £4,629,539. Michael McNeilly was appointed
as a Non-Executive Director on the KML Board as part of
the investment in 2019 and remains on the Board. Cobre
listed on the ASX in January 2020 raising A$10m.
In June 2022, Metal Tiger entered into a transaction with
Cobre to dispose of its interests in Kalahari Metals Limited
(“KML”), thereby ending direct expenditure on exploration
at a JV or project level and essentially marking the end of
the Project Investments division of the Company. In August
2022, Metal Tiger invested approximately A$1.47m into
Cobre’s A$7m fundraise to maintain its pro-rata interest
and agreed to invest a further A$1m in December 2022
to support highly encouraging exploration results from
Cobre’s successful drilling campaign. Post completion of
this a total of 7,750m of diamond drilling was successfully
completed, and within the planned exploration budget.
Of the 28 holes drilled at the Ngami Copper Project, 27
intersected the target mineralized contact, almost all of
which have returned anomalous copper mineralisation
for the Kalahari Copper Belt (“KCB”), demonstrating the
regional copper endowment in this emerging copper
district on the relatively unexplored northern margin of
the KCB. The most significant result was the intersection
of high-grade copper-silver mineralisation in drill NCP20A
at the Comet target. The intersected high-grade zone
appears to extend from drillhole NCP08 (10.7m @ 1.5% Cu
eq.) through recently completed NCP25 to NCP20A (12.2m
@ 2.68% Cu eq.) over a distance of more than 250m.
The expectation according to Cobre is for several similar
structurally controlled high-grade zones to occur within the
greater 4km Comet target, a typical feature in other known
KCB deposits. In this period Cobre also drilled the first of
several new targets, delineated from circa 6,600 partial
leach soil sample results. This received positive copper
intersections at the first target ‘Nova’.
In addition to the appointment of Dr Ross McGowan as a
Non-Executive Director, Adam Wooldridge was appointed
as the new CEO of Cobre on 8 December, complementing
his existing role as a founder and CEO of KML and Martin
Holland transitioned from Managing Director and Executive
Chairman to Executive Chairman On 14 December 2022,
Cobre announced a strategic collaboration agreement with
Sandfire to conduct a joint Airborne Gravity Gradient (AGG)
survey that will provide detailed coverage over Cobre’s
Ngami, Kitlanya West and Kitlanya East Copper Projects in
Botswana. Sandfire will contribute 50% towards the total
cost of the survey.
Cobre raised A$7m in August 2022 and a further A$5m in
December 2022, including a subsequent receipt of A$2.9m
via an oversubscribed Share Purchase Plan completed in
January 2023, to accelerate advanced exploration in the
KCB, Botswana.
Southern Gold Limited (“Southern Gold”)
Southern Gold is an ASX listed resource exploration and
development company with gold epithermal exploration
properties in South Korea. Metal Tiger made a follow-on
investment in Southern Gold during 2022 and as at 31
December 2022, held 40,794,000 shares representing
19.1% of the issued share capital of Southern Gold as well
as valued at £574,167. As part of the initial investment
agreement in 2020, Metal Tiger obtained Board nomination
rights which are maintained as long as the Company has a
relevant interest in at least 10% of the issued share capital of
Southern Gold. Terry Grammer was to be appointed to the
Board of Southern Gold but due to his sudden and tragic
passing Michael McNeilly was nominated and joined the
Board as a Non-Executive Director following Metal Tiger’s
initial investment.
A summary of key Southern Gold developments for 2022:
• Robert Smillie, Exploration Manager was appointed as
Managing Director and CEO (based in South Korea).
He has overseen an ambitious and meticulous project
generation campaign.
• As at the end of 2022, SAU had 128 exploration licences
under application, covering an area of 358.69km2.
In addition, the company has significantly advanced
work at the Deokon Au-Ag and Goseong Cu-Au-Ag
project areas towards drilling in Q1 2023, with land
access and permitting progressing well at both projects.
Detailed geologic mapping of drill target areas, drone
aeromagnetic surveys over 17km2 and two sampling
programmes were completed at Goseong.
• A geophysical gravity survey was conducted at Deokon
Au-Ag project covering 30km2 together with 3D
modelling of historic workings to develop new targets
for drilling.
• SAU diversified its exploration objectives, adding Rare
Earth Elements (REEs) and lithium-caesium-tantalum
(“LCT”) pegmatite targets as a key part of the company’s
focus in South Korea. Fieldwork commenced following
successful site vistis to priority target areas in November
2022 defined by geological consultant group RSC
Consulting Ltd.
• Metal Tiger invested A$382,000 to maintain its pro-rata
holdings as part of a A$2m private placement which
was underwritten by the three largest shareholders
including Metal Tiger.
• Southern Gold maintains 150m shares in London Stock
Exchange (“LSE”) listed Bluebird Merchant Ventures Ltd.
A sale of 50m Bluebird Merchant Ventures (LSE:BMV)
shares brought in proceeds of £250,000.
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
Metal Tiger plc
Annual Report & Accounts 2022
13
Armada Metals Limited (“Armada”)
Armada is an ASX listed (listing in December 2021 having
raised A$10m), Gabon focused, resource exploration and
development company which owns the Nyanga Project
which consists of two exploration tenements prospective
for nickel-copper sulphide, covering a total area of
2,725km2. The project lies on the western margin of the
Nyanga Basin where the basin onlaps and is also structurally
juxtaposed against the Archean to Eburnian basement
rocks. Metal Tiger held 15,000,000 shares representing
14.42% of the issued share capital of Armada as well as
3,333,333 A$0.334 warrants which expire on 22 November
2026, with the combined investment valued at £573,426.
A summary of key Armada Metals
Limited developments for 2022:
• In June 2022, Armada completed its phase 1
drilling programme noting that magmatic sulhpide
mineralisation had been intercepted in all ten diamond
holes at the Libonga North, Matchiti Central and Libonga
South targets along the Libonga-Matchiti Trend (“LMT”).
• Surface hand-grab samples collected along the
Ngongo-Yoyo Trent (“NYT”), confirmed the presence
of outcropping ultramafic intrusions with observed
magmatic sulphides for a further 40km southeast of the
LMT, extending the overall potential trend to over 60km.
Lab analysis of the samples has confirmed the NYT
as a complex, dynamic multi-phased magma conduit
system, with crustal contamination having cause
extensive sulphur saturation, with the source of the
magma in the NYT system the same as the LMT. The
data further supported intrusion fertility for polymetallic
magmatic mineralisation.
• Completed a Natural Source Audio-Magnetotelluric
(“NSAMT”) survey over the LMT and the results of
the modelling of ground NSAMT survey data defined
multiple discrete, very strong apparent conductors
which are consistent with the geological setting
of the Nyanga intrusions and will drive future drill
programmes. In addition, two new previously
concealed targets, Libonga Central and Libonga Central
Extension have been identified between the existing
Libonga North and Libonga South targets. The untested
apparent conductors are consistent with the anticipated
intrusion morphologies and are likely associated with
significant accumulations of magmatic sulphides.
• A 1,500 line-kilometre MobileMT survey, the latest
innovation in airborne electromagnetics, commenced
at the Nyanga Project on 30 November 2022 and was
deployed over Armada’s highest priority targets along
the Libonga-Matchiti Trend and the Ngongo-Yoyo Trend
at Armada’s magmatic nickel-copper Nyanga Project.
Passive Investments:
During 2022, the Company also invested in several
exploration and development companies in Asia, North
America, South America and Australia, with exploration
projects in copper, gold, silver, zinc, and tungsten.
During the course of 2022, Metal Tiger was less active in
seeking and making new investments than it had been in
previous years, with passive investments totaling £3,928,000
for the year, down from £6,137,000 the year before.
Summary of investments made in new portfolio
companies and fully exited in 2022
Investment
Listing
Investment
Alien Metals Limited*
AIM
6,000,000 ordinary shares
Adventus Mining Corp*
TSXV
280,000 ordinary shares
Canyon Resources Limited*
ASX
2,383,817 ordinary shares
Helix Resources Limited*
ASX
20,833,333 ordinary shares
Heavy Minerals Limited
ASX
1,650,000 ordinary shares
Northern Graphite Corp*
TSXV
660,000 ordinary shares
Pan Global Mining Inc
TSXV
694,444 ordinary shares
*new investments made in 2022
Outlook
At 31 December 2022, investment portfolio remains
invested in Sandfire. Sandfire operates the MATSA Copper
Operations located in the Huelva Province of south-
western Spain in the northern portion of the Iberian Pyrite
Belt. MATSA is a substantial polymetallic mining operation
comprising a 4.7Mtpa central processing facility that
sources ore from three underground mines, Aguas Teñidas
and Magdalena Mines in Almonaster la Real and the Sotiel
Mine in Calañas, producing copper, zinc and lead mineral
concentrates that are shipped from the port of Huelva.
Sandfire also has development and exploration projects
in North America and Botswana as well as exploration
projects in Australia.
The Company is optimistic that Sandfire having mined
the last ore at DeGrussa and successfully acquired and
operated MATSA for over a year is well through its transition
phase and with Motheo about to start production and with
A4 to follow in 2024/25.
Metal Tiger also has a number of early stage Equity
Investment holdings in early stage, exploration-focused
companies and some development stage companies.
Some of these investments are higher risk and may result
in substantial gains or a significant loss of value. Some of
these companies are actively pursuing exploration drilling
campaigns and we actively monitor the results of these
companies. The Company is very active in assessing new
opportunities sourcing and screening deal flow from a
variety of sources.
Metal Tiger plc
14
Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
Summary of listed investments held at 31 December 2022
Investment
Listing
Exchange
Description
No. of securities held
Value at
year end £
Sandfire Resources
Limited
ASX
Copper, gold and silver
mining and exploration
4,762,626 ordinary shares
(held as collateral for collateral loan)
18,162,187
1,167,542 ordinary shares (held as
security in structured finance loan)
Cobre Limited
ASX
Base metal exploration
46,989,136 ordinary shares
4,629,539
Southern Gold Limited
ASX
Gold mining and exploration
40,794,000 ordinary shares
574,167
Armada Exploration
Limited
ASX
Nickel and copper exploration
15,000,000 ordinary shares
573,426
3,333,333 unlisted warrants
(A$0.334 expiry 22/11/2026)
Max Resource
Corporation
TSXV
Copper exploration
1,250,500 ordinary shares
216,264
675,000 unlisted warrants
(C$0.36, 25/03/2024)
350,000 unlisted warrants
(C$0.85, 17/05/2023)
Sable Resources Limited
TSXV
Gold and silver exploration
1,506,666 ordinary shares
101,114
Antilles Gold Limited
ASX
Gold, copper exploration
and development
20,000 ordinary shares
98,325
2,333,333 unlisted warrants
(C$0.13 expiry 30/4/2023)
Greentech Metals
Limited
ASX
Nickel exploration
1,100,000 ordinary shares
86,701
03 Mining Inc
TSXV
Copper-Gold exploration
and development
93,000 ordinary shares
85,705
Artemis Resources
Limited
AIM/ASX
Copper, gold and cobalt
exploration and development
3,476,430 ordinary shares
46,967
Northern Graphite
Corporation
ASX
Graphite producer and exploration
330,000 unlisted warrants
(C$1.10 expiry 08/2/2024)
13,387
Ragusa Minerals Limited
ASX
Lithium, halloysite and gold exploration
15,000 ordinary shares
9,711
Camino Minerals Corp.
TSXV
Copper exploration
2,941,176 unlisted warrants
(C$0.25 expiry 18/5/2023)
5,708
Avidian Gold Corp
TSXV
Copper and gold exploration
500,000 unlisted warrants
(C$0.2 expiry 8/6/2024)
1,959
Inflection Resources
Limited
CSE
Copper and gold exploration
234,375 unlisted warrants
(C$0.5 expiry 14/5/2023)
1,559
Pearl Gull Iron Limited
ASX
Iron Ore exploration
550,000 unlisted warrants
(A$0.3 expiry 6/9/2024)
1,440
Anacortes Mining Corp.
TSXV
Copper and gold exploration
104,167 unlisted warrants
(C$3.3 expiry 22/7/2023)
109
Apollo Gold and
Silver Corporation
TSXV
Gold and silver exploration
110,000 unlisted warrants
(C$1.25 expiry 05/7/2023)
16
Thor Mining plc
AIM/ASX
Molyhil Tungsten Project
5,769,231 unlisted warrants
(1.3p expiry 17/08/2023)
4
Palladium One
Mining Inc.
TSXV
Nickel and copper exploration
170,000 unlisted warrants
(C$0.45 expiry 22/2/2023)
1
Metal Tiger plc
Annual Report & Accounts 2022
15
Summary of unlisted investments held at 31 December 2022
Investment
Listing
Exchange
Description
No. of securities held
Value at
year end £
Tally Limited
Private
Gold currency
3,840,909 ordinary shares
57,614
ACDC Metals Limited*
Private
Rare earths exploration
625,000 ordinary shares
56,299
Eridge Capital Limited
Private
854,545 ordinary shares
513
*Listed on 17th January 2023 on the ASX.
Summary of recent trading performances 1 January 2022 to 31 December 2022
Currency of
underlying investment
Cash outflows of
investments
in £
Cash inflows from
redemptions of
investments £
Market value of
residual positions
in £
Total return £
Total return
percentage
Australian Dollar
487,584
263,056
108,010
(116,517)
(24%)
Canadian/American Dollar
2,227,659
1,522,311
416,470
(288,877)
(13%)
Great British Pound
423,549
386,934
6,750
(29,866)
(7%)
Combined
3,138,792
2,172,301
531,230
(435,260)
(14%)
The table reflects the combined total return performance of new Passive investments made during 2022.
Assumed starting position:
Asset class
Percentage mix
Equities and warrants *
61%
Cash*
39%
*This chart is to demonstrate indicative performance as if
the passive investment arm were a closed ended fund and
assumes an allocation of starting cash plus (Passive) equity
investment positions (warrants and equities) of £7,203,000
at the beginning of 2022 and excludes the Company’s
equity positions) in Sandfire (and any dividends received)
any derivatives as well as Active investment.
*starting value as at beginning of 2022 of £7,203,000 is based on the NAV as reported on 31 December 2021, for Passive investments excluding Sandfire.
The chart below is to illustrate indicative performance of Passive investments in 2022 including the positions entered into in
during 2020 and 2021 which remained on hand as at December 2021.
Cash Flow
£8,000,000
£7,000,000
£6,000,000
£5,000,000
£4,000,000
£3,000,000
£2,000,000
£1,000,000
£0
NAV
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Dec
-£1,500,000
-£1,000,000
-£500,000
£0
£500,000
£1,000,000
£1,500,000
£9,000,000
Sales
Purchases
Closing NAV
2022 Running NAV
Metal Tiger plc
16
Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
Investment Policy
Proposed investments to be made by the Group may be:
either quoted or unquoted; made by direct acquisition
or through farm-ins; may be in companies, partnerships,
joint ventures; or direct interests in mining projects. Target
investments will generally be involved in projects in
the exploration and/or development stage and/or
producing mines.
The Group’s Project investments currently remain focused
on projects located in South East Asia, Australia, Africa and
Europe but the Company will also consider investments
in other geographical regions. The Directors identify and
assess potential investment targets and, where they believe
further investigation is required, appoint appropriately
qualified advisors to assist.
The Group carries out a comprehensive and thorough project
review process in which all material aspects of any potential
investment are subject to appropriate due diligence.
The Group’s Equity Investments segment includes both
strategic and on-market investments. In considering
acquisitions and hold/sell decisions the Group considers
the commodity price outlook, the track record of
management, the ability for the Metal Tiger management
team to “add value” through corporate governance,
financial and technical expertise, the potential to increase
substantially the value of any mining asset through
exploration and development regardless of commodity
price performance, and the ability to exit. Investments are
made in low and medium risk geographic jurisdictions.
Post year end
Post year end the shareholders adopted a new
investment policy to reflect the company’s change
in focus and strategic direction since when the prior
investment policy was adopted in June 2014.
In particular, whilst the Group remains focused on natural
resources investments and assets, the Group’s investment
strategy has moved away from direct project investments
and is now focused predominantly on equity investments
in companies involved in the mining sector. In this vein,
in November 2022 the Company was entered into the
register of small registered UK AIFMs.
Summary of the new investment policy
The Company will seek to achieve its Investment
Objective through a combination of Core Investments and
Complementary Investments.
Core Investments
The Group will primarily invest in equity securities or other
securities or instruments (including royalties) (collectively,
“financial products”) issued by companies which are
predominately admitted to trading on recognised stock
exchanges including, but not limited to, the ASX, the CSE,
the LSE (including both AIM and the Main Market), the
HKEX, the JSE, the NYSE and the TSX (including TSXV).
The Board intends to transition gradually over time
the Company’s existing portfolio of active and passive
investments and legacy positions in royalty interests into a
more diversified, balanced and liquid investment portfolio.
However, the Company will maintain the ability to be
overweight in certain high conviction investments, if the
Board believes this to be appropriate. The Board will also
be cognisant of the business and mining/commodity cycle
and from time to time it may be more appropriate for the
Group to have a greater concentration of risk in a certain
commodity or commodities, and less liquidity in order to
preserve and grow its net assets.
The Company expects to focus on opportunities that
fall within one, or ideally several, of the Core Investment
opportunities set out in the table below from which the
Company believes value can be achieved from a potential
investment whilst balancing the concentration of risk/
return of individual investments against the portfolio and
remaining nimble.
Core Investment Opportunities
• Significant discovery potential – pre or post discovery
• Country/district/first mover advantage
• Commodity price dislocations
• Potential for economic resource growth
• Financial restructuring opportunity
• M&A opportunity
• Macro/micro economic trading opportunity
• Liquidity
• Operational improvements
• Cost dislocations
The Company recognises that there may be investment
opportunities in the mining sector that fall outside the Core
Investment opportunities set out above that represent good
investment opportunities and could provide balance to
the portfolio. Such investments would be categorised as
special situation investments.
The Group may also make investments in suitable financial
products (primarily for hedging purposes) that fall outside
the remit of the mining sector, including but not limited
to investments which track relevant indices, investments
in correlated or inversely correlated metals or baskets of
Metal Tiger plc
Annual Report & Accounts 2022
17
metals, investments in correlated or inversely correlated
baskets of equity securities and other financial products,
and investments other funds or indices (which may or
may not be related to the mining sector) (collectively
“Core Investments”).
Complementary Investments
The Group may also invest in complementary business
verticals, with a focus on commercial businesses or funds
with separate management teams with that support
investment in and the funding of companies and/or
projects within the mining sector, that will generate income
for the Group. In particular, this may include, but may not
be limited to, the acquisition, seeding or establishment
of mining sector related broking or corporate banking
businesses, mining sector related credit funds, mining
sector related convertible bond funds, mining sector
related commodity trading funds for example relating to
metals or oil and gas, mining sector investment funds with
different investment strategies (for example, investment
strategies focused on precious metals, battery metals,
cleantech, downstream and upstream technology, private
equity or streaming and/or royalty businesses), as well as
funds with AUM directed to mining sector investments
which may also have non-mining sector investments
which would be restructured and divested. The Group
may to the extent legally permissible and appropriate
provide some level of shared services and share costs
with such businesses and in certain circumstances, where
relevant, the Group may also provide regulatory capital
to such businesses. The Group may seek representation
on the boards of directors of such businesses or relevant
investment, compliance, oversight or nomination
committees or any other committee relevant to provide
supervision of the Company’s investments but will
maintain separate operational control and independence
(collectively “Complementary Investments”).
Investment limits and restrictions
The Group will manage its assets in accordance with the
following investment limits and restrictions (the “Investment
Limits and Restrictions”), which, where relevant, shall be
measured at the point of investment:
• The Group will be permitted to invest in companies
registered, incorporated or domiciled in any jurisdiction,
with projects in any jurisdiction and at any point on
the mining development curve (including at the pre-
and post-discovery exploration, development and/
or production stage), provided that the Company will
not invest in companies registered, incorporated or
domiciled or with projects in jurisdictions which are
subject to major conflict or where such investments
would be in breach of sanctions administered or
enforced by (i) the United Kingdom, (ii) Australia, (iii) the
United States (including, without limitation, Office of
Foreign Assets Control of the US Treasury Department
or the US Department of State), (iii) the European Union,
or (iv) the United Nations Security Council.
• The Company will not be restricted in the allocation
of its net assets between Core Investments and
Complementary Investments. Within Core Investments,
the Company will seek to invest (but will not be bound
by such restrictions);
• 20-50 per cent. of its net assets in financial products
issued by companies which are mid to large-tier
producers, which may or may not be diversified by
jurisdiction or commodity;
• 20-40 per cent. of its net assets in financial products
issued by companies which have one or several projects
that are post resource definition, within the study phase
or development phase (pre or post financing);
• 10-30 per cent. in financial products issued
by companies which are pre or post discovery
exploration companies;
• Not more than 50 per cent. of the Company’s Gross
Asset Value at the time of investment will be invested in
the financial products of a single issuer (in aggregate);
• The Company will mainly focus on investments
with exposure to the mining sector generally,
but will not be restricted by commodity; and
• The Company will not be restricted by investment term.
Investments may be very short term in nature (including
intraday), short term (less than a year), medium term
(1-3 years) or longer term (> 3 years).
In the event of a breach of the Investment Limits and
Restrictions, the Group will attempt to resolve any breach
and a notification will be made via an RIS.
Borrowing and leverage policy
The Group will be permitted to borrow up to 50 per cent.
of its net asset value (calculated at the time of drawdown)
for the purposes of Core Investments, except where such
leverage is mitigated by an appropriately sized put option.
The Group will be permitted to borrow up to an unlimited
amount for the purposes of Complementary Investments.
Hedging and Derivatives
The Group may utilise derivatives for efficient portfolio
management purposes. In particular, non-Sterling
investments may be hedged so as to limit currency
exchange risk.
Metal Tiger plc
18
Annual Report & Accounts 2022
Cash Management
While it is intended that the Group will be fully invested
in normal market conditions, the Group may hold cash
on deposit or invest on a temporary basis in a range of
cash equivalent instruments. There is no restriction on the
amount of cash or cash equivalent instruments that the
Group may hold. Cash and cash equivalent instruments
will be held with approved counterparties and in line with
prudent cash management guidelines agreed by the Board.
Procedure to amend New
Investment Policy
No material change may be made to the New Investment
Policy without approval of the Shareholders by way of an
Ordinary Resolution.
The Company intends to deliver shareholder returns
principally through capital growth rather than income
distribution via dividends and actively manages its
investment portfolio to achieve this aim. Given the nature
of the investing policy, the Company does not intend to
make regular periodic disclosures or calculations of net
asset value. The Board considers that, in due course, the
Company may require additional funding as investments
are made and new investment opportunities arise.
RESULTS FOR THE YEAR
Operating performance
Administration costs for the year were £2,607,000 (2021:
£2,108,000). With legal fees payment costs stripped
out from the respective years, the adjusted costs total
£2,170,000 (2021: £1,983,000). The legal fees were mostly
incurred in respect of corporate strategy and compliance
work, with the Company being registered as an AIFM as
well as having incurred costs in assessing and transitioning
away from a multifaceted Company to one more reflective
of an investment and royalty owning Company. The
Board’s continuous drive for efficiencies which remain
ongoing, and the organisational chart and structure is
continuously assessed for appropriateness and whether
fit for purpose. Whilst there will be some further once off
costs to be born during 2023 in this regard, the Board
believes it is the correct strategic decision and provides the
Company with the best chance to best serve the interests
of the shareholders over the medium term.
As more fully detailed in the commentary in the Projects
Investment section, the Company has disposed of all
its remaining interest in its joint venture Kalahari Metals
to Cobre, recognising a loss on this sale of interest in
the amount of £833,000 (2021: profit of £21,000), after
recognising the Company’s proportionate share of losses
until sale date of £116,000 (2021: £493,000). There was
an overall loss in the year resulting from the disposals and
fair valuing of investments during the year of £5,110,000
(2021: gain of £1,830,000). This reflects market conditions
in the year and more specifically in the Sandfire position
which contributed to £3,775,000 of the losses. Cobre
outperformed and contributed a gain of £1,390,000 which
was somewhat paired by unrealised losses in our active
investments in Armada of £629,000 and Southern Gold of
£546,000. The Board’s conviction in the active investment
strategy remains comfortable but notes that the Company
is unlikely to pursue additional active investments in the
near term. The investments are medium to longer term
in nature offering exposure to earlier stage exploration
projects where the Company has a significant interest and
therefore some ability to influence strategic outcomes.
The Company received lower dividend income of
£146,000 (2021: £1,538,000), primarily, as a result of
Sandfire ceasing to declare a second dividend and
rather investing the capital in developing its assets and
acquisitions. The Company had net finance income of
£1,949,000 (2021: costs of £1,787,000) mainly relating to
the accretion of the royalty asset, which released £876,000
of finance income, other contributors being the change
in the value of the derivatives that hedge and secure the
Group’s structured finance loans with a gain of £881,000
(2021: loss £1,269,000). The value of the derivative inherently
moves in contrast to the performance of the underlying
share price over which the derivative is priced, being in
our instance Sandfire. Finally, a further contributor to the
finance income were foreign exchange gains for the year
of £1,061,000 (2021: loss of £500,000), primarily reflecting
the weakness of the Pound Sterling over the year and in
particular versus our US dollar denominated financial assets.
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
Drone Survey Deokon
Metal Tiger plc
Annual Report & Accounts 2022
19
The Board decided not to revalue the Company’s 2%
net smelter return (“NSR”) royalty over circa 8,000km2
of Sandfire’s exploration tenements and in-particular the
licence that holds the A4 project, which was material
contributor to the results of the Company during 2021
(£5,214,000), the Board is of the view its prudent and
appropriate to wait on any updates on the size of
Sandfire’s A4 copper/silver Mineral Resource. The Board
did however consider the carrying value of the Royalty
and the assumptions used in testing the same are
enclosed in Note 7.
All told the loss for the year on ordinary activities before tax
was £6,678,000 (2021: profit of £4,215,000).
Cashflow and financing
Disposals from equities during the year raised £14,600,000
and a further net £8,034,000 was invested into the
purchase of equities and other investments. Operational
cash outflows before working capital changes amounted
to £2,474,000 (2021: £2,009,000), with the increased cash
utilisation driven by the same drivers of the increase in
administrative expenses.
The net cash requirement for operations, was met
out, dividends received, the net proceeds of sales of
investments and joint venture interests after having
accounted for the net the repayment of loans during the
year and finally to increase cash reserves at the end of
the year.
The Group had cash reserves on 31 December 2021 of
£885,000 (2021: £648,000) and net current assets of
£19,189,000 (2021: £24,112,000).
No dividend has been declared or recommended during
the year under review (2021: Nil).
MobileMT Survey flown over
the Nyanga Project, Gabon
Diamond Drilling at the Ngami
Copper Project, Botswana.
Metal Tiger plc
20
Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
KEY PERFORMANCE INDICATORS
The key performance indicators are set out below:
31 December
2022
31 December
2021
Change
%
Net asset value
£31,973,000
£38,822,000
-18%
Net asset value – fully diluted per share¹
18.9p
22.9p
-17%
Closing share price
13.0p
20.5p
-37%
Share price premium/(discount) to net asset value – fully diluted
-31%
-10%
Market capitalisation
£22,025,000
£34,732,000
-37%
¹ Fully diluted net asset value is calculated on the aggregate number of shares in issue at the year end and the number of
warrants and options in the money at the year end. There were no warrants in the money at the yearend (2021: Nil).
Given the nature of our investments, the tendency is for
investors to look at the Group’s net assets and compare
this to market capitalisation. For Metal Tiger, the Board
believes this simplistic valuation metric does not work, as
the Group is focused on investment in major resource
projects, where the value of an interest can increase very
rapidly with successful ground exploration or corporate
developments. This is also relevant with Royalties as an asset
class, where initial valuations are determined using initial drill
result announcements in the market domain, however, as
the resource is further proven up any additional resource will
exponentially increase the value of an uncapped Royalty.
Where a project or investment has been made to acquire
commercially valuable interests, or where the Group has
acquired valuable project data and strategic positioning
in exploration licences, mining licences and licence
applications, then the costs of investment will be capitalised
in the Statement of Financial Position at the period end.
Shareholders should note therefore that at present the
published net asset position of the Group will largely
comprise the working capital representing predominantly
cash investments in joint ventures and associates, liquid
tradeable resource shares, and initial recognition of Royalties.
Remote Exploration Services (RES) truck
onsite at the Ngami Copper Project.
Metal Tiger plc
Annual Report & Accounts 2022
21
POST YEAR END DEVELOPMENTS
Equity Investments
Sandfire Resources Limited
In January 2023, Sandfire announced near-mine exploration
success at MATSA from an ongoing review and re-
interpretation of the MATSA geological model having yielded
early success with a significant new zone of VMS copper-
zinc mineralisation delineated at San Pedro, adjacent to
the Aguas Tenidas Mine and less than 100m from existing
underground mine infrastructure. For further information see
Sandfire’s announcement from 24 January 2023.
In Sandfire’s Half-Year Financial Report for the six months
ended 31 December 2022, Sandfire noted that the
outstanding MATSA Syndicated Debt Facility balance was
reduced to US$452m following the 31 January scheduled
repayment of US$80m. Sandfire noted that the annual
base case financial model review process, which reflects
the positive outlook for Copper and Zinc, and operational
performance experienced post Sandfire’s acquisition
of MATSA has provided the opportunity to engage with
the facility lenders with the aim of rescheduling future
principal repayments, and amending ongoing compliance
obligations to better align with the updated mine plan.
Furthermore, they noted that the 5.2Mtpa Motheo
Expansion Project and mining of the A4 Deposit will be
funded via a combination of existing cash, operating cash
flows and an additional US$40 to US$60m in project debt
which is currently being negotiated and is forecast to be
completed prior to the end of the 2023 financial year.
Cobre Limited
In January 2023, Cobre completed an oversubscribed
share purchase plan raising a total of circa A$2.961 well in
excess of the company’s target of A$1m.
In February 2023, Cobre reported that it was now well
funded with A$11m in cash and had commenced its 2023
drill program with two diamond drill rigs having started
drilling a 5,000m program at the Ngami Copper Project in
Botswana. Equally, they reported that recent results from
the Kitlanya West soil sampling program had provided a
number of priority areas to commence a 10,000m Aircore
(AC) drill program which is expected to provide further Cu/
Ag targets for diamond drilling.
Cobre also released assay results for drilling from 2022’s
campaign highlighting results from the most advanced
target Comet, as well as Helios, Interstellar, Luna, Nova
and Satellite. Cobre announced that it had completed the
100% acquisition of Triprop Holdings consolidating 100%
ownership of all of its subsidiary entities.
Southern Gold Limited
On 23 February 2023, Southern Gold announced that
it would commence drilling the first of two diamond
holes for 500m at the largely untested extensions of the
Deokon Main Mine at its Deokon Au-Ag Project. The Mine
has historically produced very high grades, including up to
59:3 g/t Au and 9,708 g/t Ag over a 240m vertical extent.
SAU also announced that it planned to drill two holes for
300m. at the “Golden Surprise Trend” discovered in 2019
from surface sampling which returned bonanza surface
grades of up to 78.6 g/t Au and 13,000 g/t Ag. When
announced drilling of the holes at Golden Surprise Trend
were still subject to obtaining land access.
Drilling was also in the process of being planned for the
Goseong Cu-Au-Ag Project. Southern Gold reported that
initial results from the drone geophysics magnetic survey
completed in November 2022 and that this along with
recent soil sampling programs were being reviewed.
Southern Gold noted that new exploration applications
had been lodged over highly prospective geology
adjacent to South Korea’s only two known rare earth
element (REE) deposits. Furthermore they announced
the commencement of regional exploration with the
objective of drill testing REE targets before the end of
2023. In addition desktop work for lithium targeting was
progressing well.
The company noted that government officials at Korea
Miner Rehabilitation and Mineral Resources Company are
highly supportive of SAU’s REE and lithium exploration
plans following a meeting in January.
Armada Exploration Limited
In January 2023, Armada highlighted the renewal of permit
G5-150 being received on 5 January 2023 and being valid
for an additional 3 years from 29 November 2022. The
company noted that the renewal resulted in a reduction in
the size of the tenement by approximately 18%. Armada’s
highest-priority magmatic nickel-copper targets, along the
25 kilometre (km)-long Libonga-Matchiti Trend, fall within
the renewed licence area.
Preliminary modelling of airborne Mobile Magnetotellurics
(‘MobileMT’) survey data has defined multiple preliminary
targets at the Nyanga Magmatic Nickel-Copper (Ni-Cu)
Project in Gabon, which will direct future ground based
NSAMT programs and drill targeting. The company
commenced a series of ground-based NSAMT surveys on
the highest priority MobileMT targets in advance of further
drilling at the Project.
Metal Tiger plc
22
Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
Summary of investments made between year end and the date of release of the financial statements.
Summary of investments made between 31 December 2022 and the date of release of the preliminary final report
Investment
Listing
Exchange
Description
No. of securities acquired
Investment made
£
Southern Gold Limited
ASX
Gold mining and explo-ration
16,608,696 ordinary shares
214,799
Newmont Corporation*
NYSE
Gold producer
2,400 ordinary shares
103,278
Barrick Gold Corporation*/**
NYSE
Gold producer
5,500 ordinary shares
84,706
ACDC Metals Limited
ASX
Rare earths explora-tion
135,000 ordinary shares
14,374
Dreadnought Resources Limited*
ASX
Rare earth, gold, nickel,
copper explo-ration
3,000,000 ordinary shares
172,950
Omega Oil & Gas Limited*
ASX
Oil and gas explora-tion
700,000 ordinary shares
76,661
S2 Resources Limited*
ASX
Gold and base metal exploration
583,334 ordinary shares
39,074
*Denotes new additions to the portfolio since the year end.
**Denotes fully exited by the date of the report.
PRINCIPAL RISKS AND UNCERTAINTIES
The main business risk is considered to be investment risk.
The Company faces external risks which are those that can
materially impact or influence the investment environment
within which the Company operates and can include
changes in commodity prices, and the numerous factors
which can influence those changes, including economic
recession, capital market instability, inflation and investor
sentiment and including the current and potential effects
of the coronavirus pandemic or derivatives thereof and
finally but not least the Ukraine conflict and or any other
conflict that may cause global or reginal instability over a
period of time.
Commodity prices have an impact on the investment
performance/prospects of both equity investments and
Project investments. The extent of the impact varies
depending on a wide variety of factors but depend largely
by where the investment sits on the mineral development
curve. Many of Metal Tiger’s investments sit at the
beginning of this curve, but its largest single investment,
Sandfire’s main asset, Degrussa, together with its nearest
potential development asset, the T3 Project, sit towards
the end of this curve. Commodity price risk is pervasive at
all stages of the development curve, but other prominent
risks such as exploration risk and technical and funding
risks at the exploration/development stage, may be
considered to be weighted higher earlier in the curve than
pure commodity risk which tends to have a greater impact
on producers.
The Equity Investment segment of the Group’s operations
is exposed to price risk within the market, interest
rate changes, liquidity risk and volatility particularly in
Australia. Although the investment risk within the portfolio
is dependent on many factors, the Group’s principal
investments at the year-end are in companies with
significant copper assets and, to some extent, dependent
on the market’s view of copper prices, perceived outlook
for copper demand/supply and/or the market’s view of the
management of the companies in managing those assets.
The Directors mitigate risk by carrying out a comprehensive
and thorough project/company review of any potential
investment in which all material aspects will be subject
to rigorous due diligence. Exposure to market risk as
regards the Company’s borrowings is managed by hedging
the assets acting as security for those borrowings. The
Directors believe that the Company has sufficient cash
resources to pursue its investment strategy.
Metal Tiger plc
Annual Report & Accounts 2022
23
OUTLOOK
The impact of the COVID-19 pandemic has receded, but
the recovery of the global economy has been hindered
by geopolitical tensions and rising interest rates. Since
recognising the urgent need for policy tightening to
combat inflationary pressures on the back of soaring prices,
the US Federal Reserve has raised interest rates at the
fastest pace in more than three decades, with most other
major developed central banks following suit. High inflation
has sparked cost-of-living crises and slowing global growth
and, although central banks are forecast to slow the rate
of interest rate increases, the possibility of recession for
developed markets looms.
Whilst the macro environment in developed market
economies continues to present near-term headwinds
for commodity markets, the structural backdrop with low
inventories, limited investment in new production and a
more rapid recovery in China than expected, are supportive
tailwinds. The energy transition will require enormous
scale of investment by mining companies over the coming
decades. Mining companies are in an excellent financial
position, with high levels of free cash flow and solid
balance sheets and these factors combined with the above
potential tailwinds could be a majorfactor in how 2023
shapes up for the sector.
Against this backdrop the Company remains cautiously
optimistic for the mining sector. The Board is also
confident that the Company remains well-placed to benefit
from the transition to net zero carbon emissions which
will continue to create investment opportunities in those
companies that service the associated supply chains.
GOING CONCERN
The Directors have reviewed a cash flow forecasts for a
period of at least 12 months from the date of approval of
these financial statements which demonstrate that the
Group is able to meet its commitments as they fall due.
In addition, thereto:
At the year end the Group had current assets of
£26,074,000, including cash balances of £885,000
and freely tradeable quoted investments in excess of
£24,000,000 compared with short term liabilities
of £6,885,000.
The Board also noted that the capped T3 royalty capped at
US$2m is expected to result in a receipt of cash during the
final quarter of 2023.
Whilst equity prices are volatile given, inter alia, the
coronavirus pandemic and more recently the Ukraine
conflict, the Board believes that the Group has access to
sufficient liquid, or readily converted to liquid, funds in
order trade through the crisis given the non-discretionary
cash burn rate of the Company.
Accordingly, the Directors have a reasonable expectation
that the Company will have adequate resources to
continue in operational existence for the foreseeable
future. For this reason, they continue to adopt the going
concern basis in preparing the financial statements.
Metal Tiger plc
24
Annual Report & Accounts 2022
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
SECTION 172 REPORT
As required by Section 172 of the Companies Act, a director
of a company must act in the way he or she considers,
in good faith, would likely promote the success of the
Company for the benefit of the shareholders. In doing so,
the director must have regard, amongst other matters, to
the following issues:
• the likely consequences of any decisions in the long-term;
• the interests of the Company’s employees;
• the need to foster the Company’s business relationships
with suppliers/customers and others;
• the impact of the Company’s operations on the
community and environment;
• the Company’s reputation for high standards of
business conduct; and
• the need to act fairly between members of the Company.
As set out above in the Strategic Report the Board remains
focused on providing for shareholders through the long
term success of the Company. The means by which this is
achieved is set out further below.
Likely consequences of any decisions in
the long-term;
The Chairman’s Statement, the Chief Executive Officer’s
Commentary and the Strategic Review set out the
Company’s strategy. In applying this strategy, particularly
in seeking new Project investments and strategic
holdings in other public companies the Board assesses
the long-term future of those companies with a view to
shareholder return. The approach to general strategy and
risk management strategy of the Group is set out in the
Statement of Compliance with the Quoted Companies
Alliance (“QCA”) Corporate Governance Code (the “QCA
Code”) (Principles 1 and 4) on page 30.
Interest of Employees
The Group has a very limited number of employees and
all have direct access to the Executive Directors on a daily
basis and to the Chairman, if necessary. The Group has a
formal Employees’ Policy manual which includes process
for confidential report and whistleblowing.
Need to foster the Company’s business
relationships with suppliers/customers and others;
The nature of the Group’s business is such that the majority
of its business relationships are with Corporate suppliers,
and Investment Brokers and with, the boards of directors
of the companies in which the Group has strategic stakes
to the extent that such relationships are permitted, and
with suppliers for services. As the success of the business
primarily depends on its relationship with its partners
and investees, the Executive Directors manage these
relationships on a day-to-day basis. Where possible, the
Group will take a board, or similar appointment, in strategic
investees to ensure that there is a close and successful
ongoing dialog between the parties. Service providers are
paid within their payment terms and the Group aims to
keep payment periods under 30 days wherever practical.
Impact of the Company’s operations on the
community and environment;
The Group takes its responsibility within the community
and wider environment seriously. Its approach to its social
responsibilities is set out in the Statement of Compliance
with the QCA Code (Principle 3) on page 30.
The desirability of the Company maintaining a
reputation for high standards of business conduct
The Directors are committed to high standards of business
conduct and governance and have adopted the QCA Code
which is set out on pages 30 to 31. Where there is a need
to seek advice on particular issues, the Board will consult
with its lawyers and nominated advisors to ensure that its
reputation for good business conduct is maintained.
The need to act fairly between members
of the Company
The Board’s approach to shareholder communication is
set out in the Statement of Compliance with the (Principle
2) on page 30. The Company aims to keep shareholders
fully informed of significant developments in the Group’s
progress. Information is disseminated through Stock
Exchange announcements, website updates and, where
appropriate video-casts. During 2022 the Company issued
94 stock exchange announcements on operational
issues and released twelve videos or recordings to update
shareholders. All information is made available to all
shareholders at the same time and no individual shareholder,
or group of shareholders, is given preferential treatment.
On behalf of the Board
Michael McNeilly
Chief Executive Officer
29 March 2023
Metal Tiger plc
Annual Report & Accounts 2022
25
The Company has adopted the QCA Code and where
appropriate the further requirements required by the
application of the ASX Corporate Governance Principles and
Recommendations (ASX Corporate Governance Council,
4th Edition) and, consistent with ASX listing rule 4.10.3
and AIM rule 26, this section of the Report and Accounts
explains how it complies with the QCA Code and ASX
Corporate Governance Principles and Recommendations
(ASX Corporate Governance Council, 4th Edition) or, where
it departs from each applicable corporate governance code,
to explain the reasons for so doing.
The Board is fully committed to a high standard of
corporate governance based on practices which are
proportional to the size, risks and operation of the business.
In adopting the QCA Code and where appropriate the
further requirements required by the application of the ASX
Corporate Governance Principles and Recommendations
(ASX Corporate Governance Council, 4th Edition) the
Board recognises its principles and practices which seek
to focus on the creation of medium to long term value for
shareholders without stifling the entrepreneurial spirit in
which small to medium sized companies, such as Metal
Tiger, have been created. Notwithstanding the decision
of the board to cancel the Company’s admission to AIM,
the Board has committed to maintaining the QCA Code
requirements for the ensuing year, at least.
In this section of the Report and Accounts we also detail
generally the approach the Board takes to corporate
governance and set out how the Company complies with
the majority of principles within the QCA Code and where
appropriate the further requirements required by the
application of the ASX Corporate Governance Principles
and Recommendations (ASX Corporate Governance
Council, 4th Edition). It also explains where we have decided
that the recommendations in the QCA Code and/or ASX
Corporate Governance Principles and Recommendations
(ASX Corporate Governance Council, 4th Edition) in relation
to evaluating board performance are not appropriate to our
size and operations at present.
My role as Chairman is to provide leadership of the Board
and ensure its effectiveness on all aspects of its remit to
maintain control of the Group. I am also responsible for
the implementation and practice of sound corporate
governance. As an independent Non-Executive Director, I
maintain an adequate degree of separation from the day-to-
day management of the Company in performing that role.
In the spirit of the QCA Code and where appropriate the
further requirements required by the application of the ASX
Corporate Governance Principles and Recommendations
(ASX Corporate Governance Council, 4th Edition) it is
the Board’s job to ensure that the Group is managed
for the long-term benefit of all shareholders and other
stakeholders with effective and efficient decision-making.
Corporate governance is an important part of that job,
reducing risk and adding value to the Group. The Board
will continue to monitor the governance framework of the
Group as it grows.
The Company does not have a formal nomination
committee, however it does formally consider Board
succession issues and whether the board has the
appropriate balance of skills, knowledge, experience,
and diversity. This evaluation is undertaken collectively
by the Board. Furthermore, the Company does not have
and disclose a formal process for periodically evaluating
the performance of the Board, its committees, individual
directors or senior executives nor does it disclose, in relation
to each reporting period, whether a performance evaluation
was undertaken in the reporting period in accordance with
that process. This evaluation is undertaken collectively by the
Board via an informal process.
The Company does not have a formal risk committee,
however it does formally consider and oversee risk matters
and issues in accordance with its Risk Management Policy.
This evaluation is undertaken collectively by the Board.
The remuneration of the Executive Directors is fixed by the
Remuneration Committee which comprises two Non-
Executive Directors, Charles Hall and Neville Bergin (who
has been replaced by David Wargo, post Neville Bergin’s
resignation effective 31 January 2023). The Remuneration
Committee is responsible for reviewing and determining
Company policy on executive remuneration and the
allocation of long-term incentives to executives and
employees. The full terms of reference of the Remuneration
Committee are given on the Company’s website.
The Company also has an Audit Committee, which
comprises two Non-Executive Directors, Charles Hall and
Neville Bergin (who has been replaced by David Wargo, post
Neville Bergin’s resignation effective 31 January 2023). The
Audit Committee is responsible for ensuring that the financial
performance of the Group is properly monitored and
reported upon and that any such reports are understood by
the Board. The Committee meets at least twice each year to
review the published financial information, the effectiveness
of external audit, and internal financial controls. The terms
of reference of the Audit Committee are given on the
Company’s website. The Company’s external auditor attends
the Audit Committee to present its findings on the audit and
to provide a direct line of communication with the Directors.
The Company has a diversity policy but has not yet set
measurable objectives for achieving gender diversity
in the composition of its board, senior executives and
workforce generally. At this stage the Company has
not set any measurable objectives under the policy as
there have not been appointments to the Board or in
senior management roles and no such appointments are
contemplated at this time.
The Appendix 4G, “Key to disclosures Corporate Governance
Council Principles and Recommendations” in terms
of Listing Rules 4.7.3 and 4.10.3 of the ASX for the year
ended 31 December 2022, and further information on the
Company’s corporate governance policies and practices can
be found at www.metaltigerplc.com.
Charles Hall
Chairman
29 March 2023
CHAIRMAN’S CORPORATE
GOVERNANCE STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
Metal Tiger plc
26
Annual Report & Accounts 2022
BOARD OF DIRECTORS AND
COMMITTEES OF THE BOARD
BOARD OF DIRECTORS
The Company supports the concept of an effective Board
leading and controlling the Group. The Board is responsible
for approving Group policy and strategy. It meets regularly
and has a schedule of matters specifically reserved to it for
decision. Management supplies the Board with appropriate
and timely information and the Directors are free to
seek any further information they consider necessary.
All Directors have access to advice from the Company
Secretary and independent professionals at the Company’s
expense. Training is available for new Directors and other
Directors as necessary. Given the size of the Board,
there is no separate Nomination Committee. All Director
appointments are approved by the Board as a whole.
The Board has a formal schedule of matters reserved to it
and these include:
• the approval of financial statements, dividends and
significant changes in accounting practices;
• Board membership and powers including the
appointment and removal of Board members,
determining the terms of reference of the Board and
establishing the overall control framework;
• AIM and ASX Stock Exchange related issues including
the approval of the Company’s announcements and
communications with the shareholders, the Nominated
Advisor (“NOMAD”) and the Stock Exchanges;
• senior management and subsidiary Board appointments
and remuneration, contracts and the grant of share options;
• key commercial matters;
• risk assessment;
• financial matters including the approval of the budget
and financial plans, changes to the Group’s capital
structure, the Group’s business strategy, acquisitions
and disposals of businesses and investments and capital
expenditure; and
• other matters including health and safety policy,
insurance and legal compliance.
Other matters are delegated to the Executive Directors
who regularly update and consult with the Board on
matters arising and decisions to be taken, fully utilising the
in-depth experience of Board members on such matters.
Remuneration of Executive Directors is decided by
the Remuneration Committee as detailed below. The
remuneration of Non-Executive Directors is determined by
the Board as a whole. In setting remuneration levels, the
Company seeks to provide appropriate reward for the skill
and time commitment required so as to retain the right
caliber of director at a cost to the Company which reflects
current market rates. Details of Directors’ fees and of
payments made for professional services rendered are set
out in note 8 to the financial statements.
The current Board of Directors with biographies is set out
on page 29.
Charles Hall is the Non-Executive Chairman and his role
is described in the Chairman’s Corporate Governance
Statement above.
Michael McNeilly is Chief Executive Officer. The role of the
Chief Executive Officer is the strategic development of the
Group and for communicating this clearly to the Board and,
once approved by the Board, for implementing it. In addition,
the Chief Executive Officer is responsible for overseeing the
management of the Group and its executive management.
Mark Potter (resigned 12 March 2023) is Chief Investment
Officer. The Chief Investment Officer reports to the Board of
Metal Tiger and serves as the senior investment executive,
working closely with the Chief Executive Officer having
responsibility for managing the Group’s investments. The
Chief Investment Officer is responsible for sourcing and
securing investments as well as monitoring and managing
the investment pipeline, managing the investment
programme and playing an integral role in other executive
functions related to the Group’s strategic development.
David Wargo and Neville Bergin (resigned 31 January 2023)
are Non-Executive Directors and Neville Bergin (resigned
31 January 2023) is considered to be the senior
independent Director.
Attendance at Board meetings during the year ended
31 December 2022 was as follows:
Director
Max number
of meetings
Actual
attendance
Charles Hall
21
21
Michael McNeilly
21
21
Mark Potter
21
21
Neville Bergin
21
21
David Wargo
21
20
Metal Tiger plc
Annual Report & Accounts 2022
27
AUDIT COMMITTEE
The Audit Committee, which comprises two Non-Executive
Directors, Charles Hall and Neville Bergin (replaced
on the 31 January 2023, by David Wargo). The size of
the committee is deemed appropriate by the directors
given the size and complexity of the business. The Audit
Committee is responsible for ensuring that the financial
performance of the Group is properly monitored and
reported upon and that any such reports are understood
by the Board. The Committee meets at least twice each
year to review the published financial information, the
effectiveness of external audit, and internal financial
controls. The terms of reference of the Audit Committee
are given on the Company’s website.
The Company’s external auditor attends the Audit
Committee to present its findings on the audit and to
provide a direct line of communication with the Directors.
Attendance at Audit Committee meetings during the year
ended 31 December 2022 was as follows:
Director
Max number
of meetings
Actual
attendance
Charles Hall
2
2
Neville Bergin
2
2
REMUNERATION COMMITTEE
The remuneration of the Executive Directors is fixed by
the Remuneration Committee which comprises two
Non-Executive Directors, Charles Hall and Neville Bergin
(replaced on the 31 January 2023, by David Wargo). The
size of the committee is deemed appropriate by the
directors given the size and complexity of the business The
Remuneration Committee is responsible for reviewing and
determining Company policy on executive remuneration
and the allocation of long term incentives to executives and
employees. The full terms of reference of the Remuneration
Committee are given on the Company’s website.
Attendance at Remuneration Committee meetings during
the year ended 31 December 2022 was as follows:
Director
Max number
of meetings
Actual
attendance
Charles Hall
2
2
Neville Bergin
2
2
Goseong Project Area
Metal Tiger plc
28
Annual Report & Accounts 2022
Cobre’s core shed at the Ngami
Copper Project, Botswana.
Metal Tiger plc
Annual Report & Accounts 2022
29
BOARD OF DIRECTORS AND
COMMITTEES OF THE BOARD
DIRECTORS’ BIOGRAPHIES
Charles Hall
Non-Executive Chairman
Charles Hall was appointed Non-Executive Chairman in
December 2016 and is an experienced International Banker
with over 30 years with HSBC in a variety of finance and
insurance roles. His last position was as CEO & MD HSBC
Private Bank (Luxembourg) S.A. He has had significant
overseas senior management experience as well as that
of running complex businesses. His prime focus has been
on strategy and corporate restructuring with the emphasis
on re focusing businesses on their core revenue streams.
Charles holds a BA (Hons) from the University of Sussex, is
an Associate of the Hong Kong Institute of Bankers and is a
Fellow of the Royal Geographical Society.
Length of service: 6 years
Michael McNeilly
Chief Executive Officer
Michael McNeilly was appointed in December 2016
as Chief Executive Officer, and a nominee Director of
Cobre Limited appointed by Metal Tiger. As a nominee
Non-Executive Director of MOD Resources Limited,
he was actively involved in the Sandfire Resources NL
recommended scheme offer for MOD which saw Metal
Tiger receive circa 6.3m shares in SFR. Michael resigned
from the Board of MOD as part of the scheme of
arrangement. Michael has formerly been a Non-Executive
Director of Greatland Gold plc and a Non-Executive
Director at Arkle Resources plc. Michael serves as a director
on numerous Metal Tiger investment and subsidiary entities
including notably Kalahari Metals Limited and as a nominee
Non-Executive Director of Sothern Gold Limited and Cobre
Limited. Michael was appointed CEO of Metal Tiger in
December 2016.
Michael previously worked as a corporate financier with
both Allenby Capital and Arden Partners plc (AIM: ARDN)
advising on numerous private and public transactions
including several IPOs. Michael also worked as a corporate
executive at Coinsilium (NEX: COIN) where he worked
with early stage blockchain focused start-ups. Michael
studied Biology at Imperial College London and has a BA in
Economics from the American University of Paris. Michael
is fluent in French.
Length of service: 6 years
Mark Potter
Chief Investment Officer
Mark Potter who was appointed to the Board in January
2017 has over 15 years’ experience in natural resources
investments. Mark also serves as Chief Investment Officer
of Metal Tiger plc.
Mark is currently Non-Executive Chairman of Artemis
Resources Limited (ASX:ARV) and former Non-Executive
Director of Thor Energy Plc (ASX/AIM:THR) and was a former
Director and Chief Investment Officer of Anglo Pacific
Group, a London listed natural resources royalty company.
Length of service: 6 years
Resigned 12 March 2023
Neville Bergin
Non-Executive Director
Neville Bergin, who was appointed in March 2018, is a
mining engineer with over four decades of experience
in the mining industry. He has had exposure to a range
of commodities and both underground and open pit
operational experience. His broad experience base
encompasses many operational and executive roles, and
almost ten years’ experience as a Non-Executive Director
of UK and ASX listed and unlisted companies including
Northern Star Resources Limited. Neville was previously
Vice President of Gold Fields Australia Pty Ltd where he
oversaw operational management of that company’s
Australian mines.
Neville has extensive experience in technical due diligence
having undertaken this type of investigation for several
past employers and recent clients. He is also well versed
in study management having managed several feasibility
studies. He has a BSc from the Camborne School of Mines
in the UK and currently runs his own mining consultancy
business. He is also a Non-Executive director of Marmota
Ltd (ASX: MEU).
Length of service: 5 years
Resigned 31 January 2023
David Wargo
Non-Executive Director
David Wargo, who was appointed as a Director on 1
October 2020. David Wargo is a senior natural resource
investment banker with over 21 years of experience in the
mining industry and banking industry. He is currently a
managing director of Investment Banking at Sprott Capital
Partners, a division of Sprott Inc. Prior to this, he held
a number of senior positions, including as a managing
director of the Investment Banking Division at GMP
Securities L.P. David has an industry background, having
worked for 10 years as a chemical engineer in the mining
and oil and gas sectors. David holds an Executive MBA.
Length of service: 2 years
Metal Tiger plc
30
Annual Report & Accounts 2022
COMPLIANCE WITH THE QCA
CODE OF PRACTICE
The sections below set out the requirements of the QCA
Code and how the Company complies with them.
Principle 1: Establish a strategy and business model
which promotes long term value for shareholders.
Metal Tiger’s mission is to deliver a high return for
shareholders by investing in significantly undervalued
and/or highly prospective opportunities in the mineral
exploration and development sector timed to coincide,
where possible, with a cyclical recovery in the exploration
and mining markets.
The details of our strategy and the key challenges for the
Group are set out in the Strategic Report.
Principle 2: Seek to understand and meet
shareholder needs and expectations.
Shareholder engagement is the joint responsibility of the
Chairman and the Chief Executive Officer.
The Company is committed to listening to, and
communicating openly with, its shareholders to ensure that
its strategy, business model and performance are clearly
understood. Significant developments are disseminated
through Stock Exchange announcements and regular
updates of the Company website. The AGM is a forum for
shareholders to engage in dialogue with the Board. The
results of the AGM will be published via Stock Exchange
announcements and on the Company’s website.
Principle 3: Take into account wider stakeholder
and social responsibilities and their implications
for long term success.
Metal Tiger is committed to conducting its business in an
efficient and responsible manner, in line with current best
practice guidelines for the mining and mineral exploration
sectors and international investment. The Company
integrates environmental, social and health and safety
considerations to maintain its “social licence to operate” in
all its investing activities.
For the Company’s Project investments, Metal Tiger has
adopted and seeks alignment with the best practices
and principles of e3 Plus: A Framework for Responsible
Exploration as set out by the Prospectors and Developers
Association of Canada and the International Council on
Mining and Metals Sustainable Development Framework
(the ICMM 10 Principles).
Metal Tiger’s management maintains a close dialogue with
local communities via its joint venture partners. Where
issues are raised, the Board takes the matters seriously and,
where appropriate, steps are taken to ensure that these are
integrated into the Company’s strategy.
Principle 4: Embed effective risk management,
considering both opportunities and threats,
throughout the organisation.
The Board reviews the risks facing the business as part of the
operational review at each Board meeting. Investment risk,
as regards acquiring, holding or selling investments, is carried
out in line with the Investment Policy described in the
Strategic Review and the Investment Policy itself is reviewed
on an on-going basis as market conditions change.
The Company has a system of financial controls and
reporting procedures in place which are considered to be
appropriate given the size and structure of the Group and
the nature of risks associated with the Group’s assets. Key
procedures include:
• due diligence on new acquisitions;
• Board level liaison with management of major investees
and joint venture partners including, where appropriate,
board representation;
• monthly management account reporting;
• daily review of investments and market risk with
monthly reporting to the Board;
• regular cashflow re-forecasting as circumstances
change; and
• involvement of the Executive Directors in the day-to-
day operations of the Company and its subsidiaries.
Principle 5: Maintain the Board as a well-functioning,
balanced team led by the chair.
The role of the Chairman in ensuring that the Board is
functioning appropriately is described in the Chairman’s
Statement above. The Board currently comprises two
Executive Directors (Michael McNeilly and Mark Potter
*resigned 12 March 2023) and three Non-Executive Directors
(Charles Hall, David Wargo and Neville Bergin *resigned 31
January 2023) led by the Chairman. Day-to-day operational
control rests with the Chief Executive Officer, Michael
McNeilly. Charles Hall and Neville Bergin *resigned 31
January 2023 are considered to be the independent Non-
Executive Directors in terms of the QCA Code.
Executive Directors are full time and Non-Executive
Directors are expected to attend all Board meetings and be
available to provide advice to the executive Board members
whenever necessary. Details of attendance at Board and
committee meetings are given above.
Metal Tiger plc
Annual Report & Accounts 2022
31
Principle 6: Ensure that between them the
Directors have the necessary up-to-date
experience, skills and capabilities.
The biographies of the members of the Board are given on
page 29. The Board believes that the members have a wide
experience of the markets in which the Group operates
and the skills necessary to enable the Company to carry
out its strategy.
Where appropriate the Board appoints advisors to assist it
in carrying out this strategy including geologists, surveyors,
mining experts, corporate brokers, accountants and
lawyers. The Company also ensures it is in regular contact
with its nominated advisors, Strand Hanson Limited. The
Company Secretary provides advice and guidance, as
required, to the Board on regulatory matters, assisted by
the Company’s lawyers.
Principle 7: Evaluate board performance based
on clear and relevant objectives, seeking
continuous improvement.
Metal Tiger’s Board is completely focused on implementing
the Company’s strategy. However, given the size and
nature of Metal Tiger, the Board does not consider it
appropriate to have a formal performance evaluation
procedure in place. The Board will closely monitor the
situation as required.
Principle 8: Promote a corporate culture that is
based on ethical values and behaviours.
Careful attention is given to ensure that all exploration
activity within the Company’s investments is performed in
an environmentally responsible manner and abides by all
relevant mining and environmental acts. Metal Tiger takes
a conscientious role in all its operations and is aware of its
social responsibility and its environmental duty.
Both the engagement with local communities and the
performance of all activities in an environmentally and
socially responsible way are closely monitored by the
Board and ensure that ethical values and behaviours
are recognised.
The Company has adopted a comprehensive anti-
corruption and anti-bribery policy to ensure compliance
with the UK Bribery Act 2010.
The size of the Group makes it practical for the Executive
Directors to have day-to-day contact with all members of
staff and to ensure that they abide by the Group’s policies.
The Board as a whole oversees the role of the Executive
Directors in these matters.
Principle 9: Maintain governance structures and
processes that are fit for purpose and support
good decision-making by the Board.
The details of the roles and responsibilities of the Board
are given under “Board of Directors and Committees of
the Board” above together with the corporate governance
structures which the Group has in place. The composition
of the Board, its committees, and the governance
structures in general are kept under review by the Board,
informed by its advisors, and will be updated as appropriate
as the Group evolves.
Principle 10: Communicate how the Company
is governed and is performing by maintaining
a dialogue with shareholders and other
relevant stakeholders.
The Company’s approach to communication with
shareholders and others is set out under Principles
2 and 3 above.
Metal Tiger plc
32
Annual Report & Accounts 2022
COMPLIANCE WITH THE ASX CORPORATE
GOVERNANCE PRINCIPLES AND
RECOMMENDATIONS- UNAUDITED
(ASX Corporate Governance Council, 4th Edition.)
The sections below set out the requirements of the
principles and how the Company complies with them.
Principle 1: Lay solid foundations for
management and oversight.
The role of the Chairman in ensuring that the Board is
functioning appropriately is described in the Chairman’s
Statement above. The Board currently comprises two
Executive Directors (Michael McNeilly and Mark Potter
*resigned 12 March 2023) and two Non-Executive Directors
(Charles Hall, David Wargo) led by the Chairman. Day-
to-day operational control rests with the Chief Executive
Officer, Michael McNeilly, Charles Hall is the independent
Non-Executive Director.
Executive Directors are full time and Non-Executive
Directors are expected to attend all Board meetings and be
available to provide advice to the executive Board members
whenever necessary.
All Directors and senior executives have written agreements
setting out the terms of their appointment.
The Company has not yet set any measurable objectives
under the Policy as there have not been appointments
to the Board or in senior management roles and no such
appointments are contemplated at this time.
For further details refer to the Boards Charter at
www.metaltigerplc.com/Corporate-Governance
Principle 2: Structure the board to be effective
and add value.
The composition of the Board, its committees, and the
governance structures in general are kept under review by
the Board, informed by its advisors, and will be updated as
appropriate as the Group evolves.
The Company has not yet set any measurable objectives
under the Policy as there have not been appointments
to the Board or in senior management roles and no such
appointments are contemplated at this time.
For further details refer to the Boards Charter and the
Diversity policy at
www.metaltigerplc.com/Corporate-Governance
Principle 3: Instill a culture of acting lawfully,
ethically and responsibly.
Careful attention is given to ensure that all exploration
activity within the Company’s investments is performed in
an environmentally responsible manner and abides by all
relevant mining and environmental acts. Metal Tiger takes
a conscientious role in all its operations and is aware of its
social responsibility and its environmental duty.
Both the engagement with local communities and the
performance of all activities in an environmentally and
socially responsible way are closely monitored by the Board
and ensure that ethical values and behaviors are recognised.
The Company has adopted a comprehensive list of policies
to install and monitor the said culture:
Anti-Bribery Policy, Business code of conduct, and
whistleblowers policy.
For further details refer to
www.metaltigerplc.com/Corporate-Governance
The size of the Group makes it practical for the Executive
Directors to have day-to-day contact with all members of
staff and to ensure that they abide by the Group’s policies.
The Board oversees the role of the Executive Directors in
these matters.
Metal Tiger plc
Annual Report & Accounts 2022
33
Principle 7: Recognise and manage risk.
The Board reviews the risks facing the business as part of the
operational review at each Board meeting. Investment risk,
as regards acquiring, holding or selling investments, is carried
out in line with the Investment Policy described in the
Strategic Review and the Investment Policy itself is reviewed
on an on-going basis as market conditions change.
The Company has a system of financial controls and
reporting procedures in place which are considered to be
appropriate given the size and structure of the Group and
the nature of risks associated with the Group’s assets. Key
procedures include:
• due diligence on new acquisitions;
• Board level liaison with management of major investees
and joint venture partners including, where appropriate,
board representation;
• monthly management account reporting;
• daily review of investments and market risk with
monthly reporting to the Board;
• regular cashflow re-forecasting as circumstances
change; and
• involvement of the Executive Directors in the day-to-
day operations of the Company and its subsidiaries.
The Company has adopted a comprehensive Risk
Management policy.
For further details refer to
www.metaltigerplc.com/Corporate-Governance
8: Remunerate fairly and responsibly.
The remuneration of the Executive Directors is fixed by
the Remuneration Committee which full the full year,
comprised of two Non-Executive Directors, Charles
Hall and Neville Bergin, with Neville Bergin’s resignation
effective 31 January 2023 David Wargo, also a Non-
Executive Director, has since been appointed to serve The
Remuneration Committee is responsible for reviewing and
determining Company policy on executive remuneration
and the allocation of long term incentives to executives
and employees.
For further details on the Remuneraion and Nomination
Charter refer to
www.metaltigerplc.com/Corporate-Governance
Principle 4: Safeguard the integrity of
corporate reports.
The Audit and Risk committee and the Board review all the
reports that encompass the periodic release of Financial
Performance (Yearly Financial Statements, the Interim
Financial Statements and Appendix 4e).
All material market announcements are distributed to the
Board prior to release or as a minimum shortly thereafter.
The Company has adopted comprehensive policies including
Communications and Continuous Disclosure policies.
For further details refer to
www.metaltigerplc.com/Corporate-Governance
Principle 5: Make timely and balanced disclosure.
The Company is committed to listening to, and
communicating openly with, its shareholders to ensure that
its strategy, business model and performance are clearly
understood. Significant developments are disseminated
through Stock Exchange announcements and regular
updates of the Company website. The Annual General
Meeting is a forum for shareholders to engage in dialogue
with the Board. The results of the Annual General Meeting
will be published via Stock Exchange announcements and
on the Company’s website.
Principle 6: Respect the rights of security holders.
Shareholder engagement is the joint responsibility of the
Chairman and the Chief Executive Officer.
The Company is committed to listening to, and
communicating openly with, its shareholders to ensure that
its strategy, business model and performance are clearly
understood. Significant developments are disseminated
through Stock Exchange announcements and regular
updates of the Company website. The Annual General
Meeting is a forum for shareholders to engage in dialogue
with the Board. The results of the Annual General Meeting
will be published via Stock Exchange announcements and
on the Company’s website.
Metal Tiger plc
34
Annual Report & Accounts 2022
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2022
The Directors present their report together with the audited
financial statements for the year ended 31 December 2022.
A review of the business and principal risks and
uncertainties has been included in the Strategic Report.
DIVIDENDS
No interim dividend was paid (2021: £Nil) and the Directors
do not propose a final dividend (2021: £Nil) for the 12
months ended 31 December 2022.
DIRECTORS
The Directors of the Company who held office during the
year and to the date of this report were as follows:
Charles Patrick Stewart Hall (Chairman)
David Michael McNeilly
Mark Roderick Potter (resigned 12 March 2023)
Neville Keith Bergin (resigned 31 January 2023)
David Alan Wargo
Further details of the Directors’ remuneration are given in
note 8, details of Directors’ share options are given in note
25 and the Directors’ interests in transactions of the Group
and the Company are given in note 27.
FUTURE DEVELOPMENTS
The future developments of the business are set out in the
Strategic Report under “Post Year End Developments” and
are incorporated into this report by reference.
FINANCIAL INSTRUMENTS
Details of the Group’s financial instruments are given in
note 26.
SIGNIFICANT SHAREHOLDERS
As at 24 March 2023 the following were, as far as the
Directors are aware, interested in 3% or more of the issued
share capital of the Company
Name
Number of
ordinary shares
% of issued ordinary
share capital
Michael Joseph
15,773,893
9.31%
Exploration
Capital Partners
10,003,980
5.90%
Terry Grammer-Estate
6,966,500
4.11%
RIBO Trust (beneficially
owned by Rick Rule)
6,000,000
3.54%
FINANCIAL RISK MANAGEMENT
OBJECTIVES AND POLICIES
Details of the Group’s financial risk management
objectives and policies are set out in note 26 to these
financial statements.
POST YEAR END EVENTS
The following post year events have taken place.
General Meeting:
At a general meeting of the Company, held on 20 March
2023, resolutions were approved by shareholders on the
following matters.
1.
A new investment policy (refer also to: Investment
Policy section)
2.
The cancellation of all the existing Option Schemes
3.
The implementation of proposed new Option
Schemes, and certain awards pursuant thereto.
Cancellation of its admission to the AIM market of
the London Stock Exchange (“AIM”)
The Company has announced the cancellation of its
admission to the AIM market on 31 March 2023, with the
last day of trading of shares on the AIM market being the
30 March 2023.
Name Change of the Company
The Board intends to change the name of the Company
to Strata Investment Holdings plc shortly following the
AIM Cancellation.
Sandfire Resources Limited
The Company reduced its net investment in SFR since
the year end by 532,626 shares in the SC Lowy structure,
realising £1,873,396.
Cobre
The Company has committed to subscribe to 6,666,667
Shares in Cobre at a Placement issue price of A$0.15 per
share subject to Shareholder Approval. The meeting of the
Shareholders took place on the 24 March 2023, with the
sought authority being then given and settlement of the
subscription is due to take place imminently.
Other Events
Details of purchases of Equity investments since the year
end and post year end developments at the respective
portfolio level are included in the Strategic Report section.
Metal Tiger plc
Annual Report & Accounts 2022
35
INTERNAL CONTROL
The Directors acknowledge they are responsible for the
Group’s system of internal control and for reviewing the
effectiveness of these systems. The risk management
process and systems of internal control are designed to
manage rather than eliminate the risk of the Group failing
to achieve its strategic objectives. It should be recognised
that such systems can only provide reasonable and not
absolute assurance against material misstatement or loss.
The Company has well established procedures which are
considered adequate given the size of the business.
DIRECTORS’ INDEMNITY INSURANCE
As permitted by Section 233 of the Companies Act 2006,
the Company has purchased insurance cover on behalf of
the Directors indemnifying them against certain liabilities
which may be incurred by them in relation to the Group.
STATEMENT OF DIRECTORS’
RESPONSIBILITIES
The Directors are responsible for preparing the Annual
Report and Financial Statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the
Directors have elected to prepare Group and Company
financial statements in accordance with UK adopted
International Accounting Standards. Under company law
the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view
of the state of affairs of the Group and of the Company
and of the profit or loss of the Group for that period. The
Directors are also required to prepare financial statements
in accordance with the rules of both the London Stock
Exchange for companies quoted on AIM and the Australian
Stock Exchange in preparing these financial statements, the
Directors are required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and accounting estimates that are
reasonable and prudent;
• state whether they have been prepared in accordance
with UK adopted International Accounting Standards,
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 are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Group’s transactions and disclose with
reasonable accuracy at any time the financial position
of the Group and the Company and enable them to
ensure that the financial statements comply with the
Companies Act 2006. They are also responsible for
safeguarding the assets of the Group and the Company
and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
In the case of each person who was a Director
at the time this report was approved:
• 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 steps that the Director ought
to have taken as a Director to make himself aware of
any relevant audit information and to establish that the
Company’s auditor is aware of that information.
The Directors are responsible for ensuring that the
Annual Report and the Financial Statements are
made available on a website. Financial statements are
published on the Company’s website in accordance
with legislation in the United Kingdom governing the
preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions.
The maintenance and integrity of the Company’s website
are the responsibility of the Directors. The Directors’
responsibilities also extend to the on-going integrity of the
financial statements contained therein.
AUDITOR
A resolution to re-appoint Crowe U.K. LLP as auditor of the
Company for the year ended 31 December 2023 will be
proposed at the forthcoming Annual General Meeting.
By order of the Board
Adrian Bock
Secretary
29 March 2023
Metal Tiger plc
36
Annual Report & Accounts 2022
INDEPENDENT AUDITOR’S REPORT TO
THE SHAREHOLDERS OF METAL TIGER PLC
FOR THE YEAR ENDED 31 DECEMBER 2022
Opinion
We have audited the financial statements of Metal Tiger plc
(the “Parent Company”) and its subsidiaries (the “Group”)
for the year ended 31 December 2022, which comprise:
• the Group statement of comprehensive income for the
year ended 31 December 2022;
• the Group and Parent Company statements of financial
position as at 31 December 2022;
• the Group and Parent Company statements of cash
flows for the year then ended;
• the Group and Parent Company statements of changes
in equity for the year then ended; and
• the notes to the financial statements, including
significant accounting policies.
The financial reporting framework that has been
applied in the preparation of the financial statements is
applicable law and UK-adopted International Accounting
Standards and, as regards the parent company, as
applied in accordance with the Companies Act 2006.
In our opinion:
• the financial statements give a true and fair view of the
state of the Group’s and of the Parent Company’s affairs
as at 31 December 2022 and of the Group’s loss for the
period then ended;
• the group financial statements have been properly
prepared in accordance with UK-adopted international
accounting standards;
• the parent company financial statements have been
properly prepared in accordance with UK-adopted
International Accounting Standards as applied in
accordance with the Companies Act 2006, and
• have been prepared in accordance with the
requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We
are independent of the Group and the Parent Company
in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK,
including the FRC’s Ethical Standard, and we have fulfilled
our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for
our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded
that the directors’ use of the going concern basis of
accounting in the preparation of the financial statements
is appropriate. Our evaluation of the directors’ assessment
of the Group’s and Parent Company’s ability to continue
to adopt the going concern basis of accounting included:
• Assessing the cash flow requirements of the Group
based on budgets and forecasts;
• Understanding what forecast expenditure is committed
and what could be considered discretionary;
• Considering the liquidity of existing assets on the
statement of financial position;
• Considering the terms of the finance facilities and the
amount available for drawdown; and
• Considering potential downside scenarios and the
resultant impact on available funds.
Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the Group’s and Parent Company’s
ability to continue as a going concern for a period of at
least twelve months from when the financial statements
are authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Overview of our audit approach
Materiality
In planning and performing our audit we applied 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. We used
the concept of materiality to both focus our testing and to
evaluate the impact of misstatements identified.
Based on our professional judgement, we determined
overall materiality for the Group financial statements
as a whole to be £570,000 (2021: £650,000), based on
approximately 1.8% of the Group’s net assets at planning
stage. We did not consider it appropriate subsequently
to amend our assessment. Materiality for the Parent
Company financial statements as a whole was set at
£560,000 (2021: £630,000) based on approximately 1.8%
of the company net assets at planning stage.
Metal Tiger plc
Annual Report & Accounts 2022
37
We use a different level of materiality (‘performance
materiality’) to determine the extent of our testing for the
audit of the financial statements. Performance materiality
is set based on the audit materiality as adjusted for the
judgements made as to the entity risk and our evaluation
of the specific risk of each audit area having regard to the
internal control environment. This is set at £399,000 (2021:
£455,000) for the group and £392,000 (2021: £441,000)
for the parent.
Where considered appropriate performance materiality
may be reduced to a lower level, such as, for related party
transactions and directors’ remuneration.
We agreed with the Audit Committee to report to it all
identified errors in excess of £17,100 (2021: £19,500).
Errors below that threshold would also be reported to it
if, in our opinion as auditor, disclosure was required on
qualitative grounds.
Overview of the scope of our audit
The parent company’s operations are based in the UK.
Our audit was conducted from the UK. The group has
components accounted for in Thailand which were
not considered to be significant for the scope of the
consolidated audit. The UK audit team undertook
analytical procedures over the balances within the non-
significant components.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the
financial statements of the current period and include the
most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified. These
matters included those which had the greatest effect on:
the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit
of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion
on these matters.
This is not a complete list of all risks identified by our audit.
Metal Tiger plc
38
Annual Report & Accounts 2022
INDEPENDENT AUDITOR’S REPORT TO
THE SHAREHOLDERS OF METAL TIGER PLC
FOR THE YEAR ENDED 31 DECEMBER 2022
Key audit matter
How the scope of our audit
addressed the key audit matter
Income recognition
Given the nature of the business the key group income
generated relates to the (loss)/gain on investments disposed
and movements in fair value of investments held for trading.
There is a risk of error in relation to the measurement of
the fair value, in particular to those which cannot be agreed
to observable market data, as well as the identification
of the point of disposal and associated consideration for
investments where arrangements can be complex.
Our procedures included:
• Agreeing a sample of the disposal of investments
during the year to supporting documentation. In our
testing we have agreed the date of disposal, associated
consideration and re-calculated the associated gain or
loss arising;
• Reviewing disposals either side of the year end
ensuring that the income has been appropriately
accounted for within the correct period.
Movements in fair value were also considered and
are discussed within ‘Measurement and valuation of
investments’ below.
Classification, measurement and valuation of
investments
The group holds a number of different types of
investment where judgement is required when
determining the accounting treatment and whether
they are accounted for as investments in subsidiaries,
investments in joint ventures, investments in associates or
direct equities division investments.
In addition, certain investments cannot be agreed to
observable market data, in particular investments in
the associates, investments in joint ventures and the
investments held in share warrants. For these investments,
management has determined alternative approaches to
ensure that these are appropriately valued at the year end.
Our procedures included:
• For a sample of investments during the year,
considering the classification determined by
management which included consideration of their
structure, legal form, contractual agreement and any
other fact and circumstances available.
• Agreeing the year end value of a sample of
investments to observable data in order to verify
the carrying value of those investments. Where this
information cannot be agreed to observable market
data, we have discussed the assumptions determined
by management in assessing the value, challenging
where appropriate, as well considering whether there
is any evidence investments may be impaired.
• Considering the adequacy of the disclosures made in
the financial statements over this as a significant area
of judgement.
Metal Tiger plc
Annual Report & Accounts 2022
39
Our audit procedures in relation to these matters were
designed in the context of our audit opinion as a whole.
They were not designed to enable us to express an
opinion on these matters individually and we express no
such opinion.
Other information
The Directors are responsible for the other information
contained within the annual report. The other information
comprises the information included in the annual report,
other than the financial statements and our auditor’s report
thereon. Our opinion on the financial statements does
not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express
any form of assurance conclusion thereon.
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 this gives rise to a material
misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that
there is a material misstatement of this other information,
we are required to report that fact. We have nothing to
report in this regard.
Opinion on other matters prescribed by the
Companies Act 2006
In our opinion based on the work undertaken in the course
of our audit
• the information given in the Strategic Report and the
Directors’ Report for the financial year for which the
financial statements are prepared is consistent with
the financial statements; and
• the Strategic Report and the Directors’ Report
have been prepared in accordance with applicable
legal requirements.
Matters on which we are required
to report by exception
In light of the knowledge and understanding of the Group
and the Parent Company and their environment obtained
in the course of the audit, we have not identified material
misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following
matters where the Companies Act 2006 requires us to
report to you if, in our opinion:
• adequate accounting records have not been kept by
the parent company, or returns adequate for our audit
have not been received from branches not visited by
us; or
• the parent company financial statements are not in
agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified
by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Responsibilities of the Directors
for the financial statements
As explained more fully in the directors’ responsibilities
statement set out on page 35, the Directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to
enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors
are responsible for assessing the Group’s and Parent
Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless
the directors either intend to liquidate the Group or the
Parent Company or to cease operations, or have no
realistic alternative but to do so.
Metal Tiger plc
40
Annual Report & Accounts 2022
INDEPENDENT AUDITOR’S REPORT TO
THE SHAREHOLDERS OF METAL TIGER PLC
FOR THE YEAR ENDED 31 DECEMBER 2022
Auditor’s responsibilities for the audit of
the financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with ISAs (UK) will always detect a material misstatement
when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of
these financial statements.
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above,
to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures
are capable of detecting irregularities, including fraud is
detailed below:
We obtained an understanding of the legal and regulatory
frameworks within which the company operates, focusing
on those laws and regulations that have a direct effect on
the determination of material amounts and disclosures
in the financial statements. The laws and regulations we
considered in this context were the Companies Act 2006
and taxation legislation. Technical, or regulatory laws and
regulations which are inherent risks in extractive industries
are mitigated and managed by the Board and management
in conjunction with expert regulatory consultants in order
to monitor the latest regulations and planned changes to
the regulatory environment.
We identified the greatest risk of material impact on the
financial statements from irregularities, including fraud,
to be the override of controls by management. Our audit
procedures to respond to these risks included enquiries
of management about their own identification and
assessment of the risks of irregularities, sample testing on
the posting of journals including validation to underlying
support and reviewing accounting estimates for biases.
Owing to the inherent limitations of an audit, there is an
unavoidable risk that we may not have detected some
material misstatements in the financial statements, even
though we have properly planned and performed our
audit in accordance with auditing standards. We are not
responsible for preventing non-compliance and cannot be
expected to detect non-compliance with all laws
and regulations.
These inherent limitations are particularly significant in
the case of misstatement resulting from fraud as this may
involve sophisticated schemes designed to avoid detection,
including deliberate failure to record transactions, collusion
or the provision of intentional misrepresentations.
A further description of our responsibilities is available on
the Financial Reporting Council’s website at: www.frc.org.
uk/auditorsresponsibilities. This description forms part of
our auditor’s report.
Use of our report
This report is made solely to the company’s members, as
a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members
those matters we are required to state to them in an
auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the
company’s members as a body, for our audit work, for this
report, or for the opinions we have formed.
John Glasby (Senior Statutory Auditor)
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
29 March 2023
Metal Tiger plc
Annual Report & Accounts 2022
41
Area shot at the Ngami
Copper Project, Botswana.
Metal Tiger plc
42
Annual Report & Accounts 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
Notes
2022
£’000
2021
£’000
(Loss)/profit on sale/partial sale of interests in explorations in Botswana
15
(833)
21
(Loss)/Profit on disposal of investments
18
(1,156)
1,979
Movement in fair value of fair value accounted equities
4
(3,954)
(149)
Share of post-tax losses of equity accounted joint ventures
15
(116)
(493)
Provision against cost of long term investments
16
(107)
-
Investment income
5
146
1,538
Other income
6
-
5,214
Net (loss)/gain before administrative expenses
(6,020)
8,110
Administrative expenses
(2,607)
(2,108)
OPERATING (LOSS)/PROFIT
3,7
(8,627)
6,002
Finance income
9
2,854
467
Finance costs
10
(905)
(2,254)
(LOSS)/PROFIT BEFORE TAXATION
3
(6,678)
4,215
Tax on profit on ordinary activities
11
49
(49)
(LOSS)/PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION
7
(6,629)
4,166
OTHER COMPREHENSIVE INCOME - ITEMS WHICH MAY BE
SUBSEQUENTLY RECLASSIFIED TO PROFIT OR LOSS:
Exchange differences on translation of foreign operations
(306)
410
TOTAL COMPREHENSIVE (LOSS)/PROFIT FOR THE YEAR
(6,935)
4,576
(LOSS)/PROFIT FOR THE YEAR ATTRIBUTABLE TO:
Owners of the parent
(6,629)
4,166
Non-controlling interest
-
-
(LOSS)/PROFIT FOR THE YEAR
(6,629)
4,166
TOTAL COMPREHENSIVE (LOSS/PROFIT FOR THE YEAR ATTRIBUTABLE TO:
Owners of the parent
(6,937)
4,579
Non-controlling interest
2
(3)
TOTAL COMPREHENSIVE (LOSS)/PROFIT FOR THE YEAR
(6,935)
4,576
LOSS/EARNINGS PER SHARE
Basic (loss)/earnings per share
13
(3.91p)
2.59p
Fully diluted (loss)/earnings per share
13
(3.91p)
2.59p
Metal Tiger plc
Annual Report & Accounts 2022
43
CONSOLIDATED AND COMPANY STATEMENTS OF FINANCIAL POSITION
AT 31 DECEMBER 2022
Note
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
NON-CURRENT ASSETS
Intangible assets
18
-
21
-
Property, plant and equipment
145
-
19
-
Deferred tax asset
11
2,213
2,213
2,164
2,164
Investment in subsidiaries
14
-
-
-
564
Investment in joint ventures
15
-
-
2,873
2,873
Other non-current asset investments
16
-
-
3,613
3,613
Royalties receivable
17
12,753
12,753
10,593
10,593
15,129
14,966
19,283
19,807
CURRENT ASSETS
Equity investments accounted for under fair value
18
24,565
24,565
32,031
32,031
Trade and other receivables
19
624
201
477
199
Amounts due from related parties
27
-
-
-
3,111
Cash and cash equivalents
20
885
860
648
635
26,074
25,626
33,156
35,976
CURRENT LIABILITIES
Trade and other payables
21
594
390
312
244
Loans and borrowings
22
6,291
6,241
8,732
8,686
6,885
6,631
9,044
8,930
NET CURRENT ASSETS
19,189
18,995
24,112
27,046
NON-CURRENT LIABILITIES
Loans and borrowings
22
-
-
2,242
2,242
Deferred tax liability
11
2,213
2,213
2,213
2,213
Contingent consideration
23
132
132
118
118
2,345
2,345
4,573
4,573
NET ASSETS
31,973
31,616
38,822
42,280
EQUITY
Share capital
24
170
170
170
170
Share premium account
24
15,704
15,704
15,704
15,704
Capital redemption reserve
24
4
4
4
4
Share based payment reserve
2,279
2,279
2,343
2,343
Warrant reserve
83
83
3,048
3,048
Translation reserve
43
-
351
-
Retained profits*
13,600
13,376
17,114
21,011
TOTAL SHAREHOLDERS’ FUNDS
31,883
31,616
38,734
42,280
Equity non-controlling interests
90
-
88
-
TOTAL EQUITY
31,973
31,616
38,822
42,280
*Retained profits include the Company’s loss for the year after taxation of £10,750,000 (2021: profit £4,418,000).
These financial statements were approved by the Board of Directors on 29 March 2023 and were signed on its behalf by:
Michael McNeilly, Director
Company number: 04196004
Metal Tiger plc
44
Annual Report & Accounts 2022
CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
CASH FLOWS FROM OPERATING ACTIVITIES
(Loss)/Profit before taxation
(6,678)
(10,799)
4,215
4,468
Adjustments for:
Loss/(Profit) on sale of exploration operations in Botswana
833
833
(21)
(21)
Loss/(Profit) on disposal of fair value accounted equities
1,156
1,156
(1,979)
(1,979)
Movement in fair value of investments
3,954
3,954
149
149
Share of post-tax losses of equity accounted joint ventures
116
116
493
493
Movement in provision, and write-offs of, long term investments
107
107
-
-
Movement in provision against subsidiary investments
-
4,336
-
-
Share based payment charge for year
86
86
86
86
Depreciation and amortisation
47
-
13
-
Other income
-
-
(5,214)
(5,214)
Investment income
(146)
(146)
(1,538)
(1,538)
Finance income
(2,854)
(2,845)
(467)
(491)
Finance costs
905
905
2,254
2,213
Operating cash flow before working capital changes
(2,474)
(2,297)
(2,009)
(1,834)
Decrease/(Increase) in trade and other receivables
(147)
(1)
72
131
(Decrease)/Increase in trade and other payables
282
146
(11)
(46)
Decrease/(Increase) in amounts due from subsidiaries
-
(634)
-
174
Unrealised foreign exchange gains and losses
110
384
(387)
(797)
Net cash outflow from operating activities
(2,229)
(2,402)
(2,335)
(2,372)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from current asset investment disposals
14,600
14,600
13,434
13,434
Purchase of fixed assets
(165)
-
(9)
-
Sale of investment in, and loans to, joint ventures
2,046
2,046
(453)
(453)
Purchase of current asset investments
(8,034)
(8,034)
(18,676)
(18,676)
Investment income
146
146
1,538
1,538
Net cash outflow from investing activities
8,593
8,758
(4,166)
(4,157)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
-
-
3,191
3,191
Share issue costs
-
-
(217)
(217)
Loans drawn down
4,620
4,620
4,829
4,829
Loans paid
(9,846)
(9,846)
(618)
(618)
Interest paid
(905)
(905)
(491)
(451)
Net cash (outflow)/inflow from financing activities
(6,131)
(6,131)
6,694
6,734
NET INCREASE IN CASH AND CASH EQUIVALENTS
233
225
193
205
Cash and cash equivalents brought forward
648
635
458
430
Effect of exchange rate changes
4
-
(3)
-
CASH AND CASH EQUIVALENTS AT END OF YEAR
885
860
648
635
Metal Tiger plc
Annual Report & Accounts 2022
45
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
Share
capital
£’000
Share
premium
£’000
Capital
Redemption
reserve
£’000
Share based
payment
reserve
£’000
Warrant
reserve
£’000
Translation
reserve
£’000
Retained
profits
£’000
Total equity
shareholders’
funds
£’000
Non-
controlling
interests
£’000
Total
equity
£’000
BALANCE AT
1 JANUARY 2021
153
12,831
4
2,257
5,476
(62)
10,436
31,095
91
31,186
Profit for the year ended
31 December 2021
-
-
-
-
-
-
4,166
4,166
-
4,166
Other comprehensive
income
-
-
-
-
-
413
-
413
(3)
410
TOTAL
COMPREHENSIVE INCOME
-
-
-
-
-
413
4,166
4,579
(3)
4,576
Share issues
17
3,174
-
-
-
-
-
3,191
-
3,191
Warrants issued
-
-
-
-
84
-
-
84
-
84
Cost of share-
based payments
-
-
-
86
-
-
-
86
-
86
Transfer of reserves relating
to exercise and expiry of
options and warrants
-
-
-
-
(2,512)
-
2,512
-
-
-
Share issue expenses
-
(301)
-
-
-
-
-
(301)
-
(301)
TOTAL CHANGES
DIRECTLY TO EQUITY
17
2,873
-
86
(2,428)
-
2,512
3,060
-
3,060
BALANCE AT
31 DECEMBER 2021
170
15,704
4
2,343
3,048
351
17,114
38,734
88
38,822
Loss for the year ended
31 December 2022
-
-
-
-
-
-
(6,629)
(6,629)
-
(6,629)
Other comprehensive
income
-
-
-
-
-
(308)
-
(308)
2
(306)
TOTAL
COMPREHENSIVE INCOME
-
-
-
-
-
(308)
(6,629)
(6,937)
2
(6,935)
Cost of share-
based payments
-
-
-
86
-
-
-
86
-
86
Transfer of reserves
relating to expiry of
options and warrants
-
-
-
(150)
(2,965)
-
3,115
-
-
-
TOTAL CHANGES
DIRECTLY TO EQUITY
-
-
-
(64)
(2,965)
-
3,115
86
-
86
BALANCE AT
31 DECEMBER 2022
170
15,704
4
2,279
83
43
13,600
31,883
90
31,973
Metal Tiger plc
46
Annual Report & Accounts 2022
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
Share
capital
£’000
Share
premium
account
£’000
Capital
redemption
reserve
£’000
Share
based
payment
reserve
£’000
Warrant
reserve
£’000
Retained
profits
£’000
Total
equity
£’000
BALANCE AT 1 JANUARY 2021
153
12,831
4
2,257
5,476
14,081
34,802
Profit for the year and other
comprehensive income for the
year ended 31 December 2021
-
-
-
-
-
4,418
4,418
Share issues
17
3,174
-
-
-
-
3,191
Warrants issued
-
-
-
-
84
-
84
Cost of share-based payments
-
-
-
86
-
-
86
Transfer of reserves relating
to exercise and expiry of
options and warrants
-
-
-
-
(2,512)
2,512
-
Share issue expenses
-
(301)
-
-
-
-
(301)
TOTAL CHANGES
DIRECTLY TO EQUITY
17
2,873
-
86
(2,428)
2,512
3,060
BALANCE AT 31 DECEMBER 2021
170
15,704
4
2,343
3,048
21,011
42,280
Loss for the year and other
comprehensive income for the
year ended 31 December 2022
-
-
-
-
-
(10,750)
(10,750)
Cost of share-based payments
-
-
-
86
-
-
86
Transfer of reserves relating to
expiry of options and warrants
-
-
-
(150)
(2,965)
3,115
-
TOTAL CHANGES
DIRECTLY TO EQUITY
-
-
-
(64)
(2,965)
3,115
86
BALANCE AT 31 DECEMBER 2022
170
15,704
4
2,279
83
13,376
31,616
Metal Tiger plc
Annual Report & Accounts 2022
47
1. GENERAL INFORMATION
Metal Tiger plc is a public limited company incorporated in the
United Kingdom. The shares of the Company are listed on the AIM
market of the London Stock Exchange as well as on the Australian
Stock Exchange. The Group’s principal activities are described in
the Strategic Report.
2. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
BASIS OF PREPARATION
The financial statements have been prepared in accordance with
UK adopted International Accounting Standards. The financial
statements have also been prepared under the historical cost basis,
except for certain assets and liabilities which are measured at fair
value details of which are set out in the relevant policies below.
The financial statements are presented in UK pounds, which is also
the Company’s functional currency.
GOING CONCERN
The Directors have prepared cash flow forecasts for a period of
at least 12 months from the date of approval of these financial
statements which demonstrate that the Group is able to meet its
commitments as they fall due. On this basis, the Directors have
a reasonable expectation that the Group has adequate resources
to continue operating for the foreseeable future. For this reason,
they continue to adopt the going concern basis in preparing the
Group’s financial statements.
CHANGES IN ACCOUNTING POLICIES
New/Revised Standards and Interpretations Adopted in 2022:
• IAS 16 “Property, Plant and Equipment” regarding proceeds
before intended use.
• IAS 37 “Onerous contracts” regarding costs a company should
include as the cost fulfilling a contract when assessing whether
a contract is onerous.
• A number of narrow-scope amendments to IFRS 3.
No new standards or amendments to standards that are mandatory
for the first time for the financial year commencing 1 January 2022
affected any of the amounts recognised in the current year or any
prior years.
The Group has not early adopted any standard, interpretation or
amendment that has been issued but is not yet effective.
Relevant Standards/Amendments thereto not yet effective for the
financial statements for the year ended 31 December 2022:
• Amendments to IAS 1: Presentation of financial statements
1 January 2024*
• Amendments to IAS 1: Disclosure of Accounting Policies
1 January 2023
• Amendments to IFRS 16: Lease liability in a Sale and Leaseback
1 January 2024*
• Amendments to IAS 12: Deferred Tax Related to Assets and
Liabilities Arising from a Single Transaction
• 1 January 2023
• Amendments to IAS 8: Definition of Accounting Estimates
1 January 2023
*Subject to UK endorsement
The Group has not early adopted any standard, interpretation or
amendment that has been issued but is not yet effective. above
and the Grroup does not believe any of such standards and or
amendments will not have a significant impact on the Group’s
results of operations and financial position in the period of
initial application.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of financial statements in conformity with IFRS
requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues
and expenses during the reporting year. These estimates and
assumptions are based upon management’s knowledge and
experience of the amounts, events or actions. Actual results may
differ from such estimates.
Estimates and judgements are continually evaluated and are
based on historical experience and other factors, including
expectations of future events that are believed to be reasonable
under the circumstances.
In certain circumstances, where fair value cannot be readily
established, the Directors are required to make judgements
over carrying value impairment and evaluate the size of any
impairment required.
FAIR VALUE OF INVESTMENTS
The Group’s investments accounted for within the Equity
Investment operating segment require measurement at fair value.
Investments in shares in quoted entities traded in an active market
and unquoted shares are valued as set out in “Current Assets
Investments” below. The unquoted share warrants (Level 3) are
shown at Directors’ valuation based on a value derived from either
Black-Scholes or Monte Carlo pricing models depending on the
suitability of the method to the specific warrant taking into account
the terms of the warrant and discounting for the non-tradability of
the warrants where appropriate. Both pricing models use inputs
relating to expected volatility that require estimations. Estimations
used at year end are more fully disclosed in note 18. No value is
ascribed to warrants which include terms which cause the exercise
price to be dependent on events outside the control of the Group
and outcomes which are unable to be predicted with any certainty.
ROYALTIES RECEIVABLE
Royalties receivable are stated at the expected amounts to be
received based on existing committed contracts and discounted
at an appropriate discount rate which reflects the estimated risk-
weighted cost of capital relevant to that asset. The amortisation
of the discount over the period to the receipt of the royalty
payments is credited to the Statement of Comprehensive Income
as finance income.
Where royalty contracts have been entered into but the timing of
receipts are unknown or cannot be reliably forecast, no value is
attributed to the royalties.
The expected amounts to be received, the period over which
they will be received and the appropriate discount rate are
assessed on the date of acquisition of the royalty interests and
re-assessed at each reporting date.
Considerations and estimations used to determine the carrying
value at year end are more fully disclosed in Note 17.
Contracts are assessed on a contract-by-contract basis.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Metal Tiger plc
48
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)
CLASSIFICATION OF JOINT ARRANGEMENTS
For all joint arrangements structured in separate vehicles the
Group must assess the substance of the joint arrangement in
determining whether it is classified as a joint venture or joint
operation. This assessment requires the Group to consider
whether it has rights to the joint arrangement’s net assets (in which
case it is classified as a joint venture), or rights to and obligations
for specific assets, liabilities, expenses, and revenues (in which
case it is classified as a joint operation). Factors the Group must
consider include:
• structure;
• legal form;
• contractual agreement; and
• other facts and circumstances.
Upon consideration of these factors, the Group’s judgement
is that all its joint arrangements structured through separate
vehicles give it rights to the net assets and are therefore classified
as joint ventures.
SUBSIDIARY AND JOINT VENTURE INVESTMENTS
In arriving at the carrying value of investments in subsidiaries and
joint ventures, the Group determines the need for impairment
based on the level of geological knowledge and confidence of the
mineral resources (as further described in its accounting policy).
Such decisions are taken on the basis of the exploration and
research work carried out in the period utilising expert reports.
STATEMENT OF COMPLIANCE
The financial statements comply with UK adopted international
Accounting Standards.
Details of new standards applied during the year and their
effect on the financial statements are set out under “Basis of
Preparation” above.
At the date of authorisation of these financial statements, a
number of Standards and Interpretations were in issue but not yet
effective. The adoption of these standards and interpretations, or
any of the amendments made to existing standards as a result of
the annual improvements cycle, will not have a material effect on
the financial statements in the year of initial application nor will
require restatement of prior year results, assets or liabilities.
BASIS OF CONSOLIDATION
The Consolidated Statement of Comprehensive Income and
Statement of Financial Position include the financial statements
of the Company and its subsidiary undertakings made up to
31 December 2022.
Subsidiaries are all entities over which the Group has control. The
Group controls an entity when the Group is exposed to, or has
rights to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power over the
entity. Subsidiaries are fully consolidated from the date on which
control is transferred to the Group. They are deconsolidated from
the date that control ceases.
Profit or loss and each component of other comprehensive
income are attributed to the equity holders of the parent of the
Group and to non-controlling interests, even if this results in non-
controlling interests having a deficit balance. When necessary,
adjustments are made to the financial statements of subsidiaries
to bring their accounting policies into line with the Group’s
accounting policies. All intra-group assets and liabilities, equity,
income, expenses and cash flows relating to transactions between
members of the Group are eliminated in full on consolidation.
A change in ownership interest of a subsidiary without a loss
of control is accounted for as an equity transaction. When the
Group ceases to have control, any retained interest in the entity
is re-measured to its fair value at the date when control is lost,
with the change in carrying amount recognised in profit or loss.
The fair value is the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an associate,
joint venture or financial asset. In addition, any amounts previously
recognised in other comprehensive income in respect of that
entity are accounted for as if the Group had directly disposed of
the related assets or liabilities. This may require that the amounts
previously recognised in other comprehensive income be
reclassified to profit or loss.
BUSINESS COMBINATIONS
Business combinations are accounted for using the acquisition
method. The cost of an acquisition is measured as the aggregate
of the consideration transferred, measured at fair value at the date
of acquisition and the amount of any non-controlling interest in
the acquired entity. Non-controlling interests (“NCI”) may be initially
measured either at fair value or at the NCI’s proportionate share of
the recognised amounts of the acquiree’s identifiable net assets.
The choice of measurement basis is made on a transaction-by-
transaction basis. Acquisition costs incurred are expensed and
included in administrative expenses except where they relate to
the issue of debt or equity instruments in connection with the
acquisition, in which case they are included in finance costs.
When the business combination is achieved in stages, any
previously held equity interest is re-measured at its acquisition date
fair value and any resulting gain or loss is recognised in profit or
loss. It is then considered in determination of goodwill.
Any contingent consideration to be transferred by the acquirer is
recognised at fair value at the acquisition date. Any subsequent
changes to the fair value of the contingent consideration are
adjusted against the cost of the acquisition if they occur within
the measurement period of twelve months following the date
of acquisition. Any subsequent changes to the fair value of the
contingent consideration after the measurement period are
recognised in the Income Statement. Contingent consideration
that is classified as equity is not re-measured and subsequent
settlement is accounted for within equity.
SEGMENTAL REPORTING
The accounting policy for identifying segments is based on internal
management reporting information that is regularly reviewed by
the chief operating decision maker, which is identified as the Board
of Directors. In identifying its operating segments, management
generally follows the Company’s service lines which represent the
main products and services provided by the Company.
EXPLORATION COSTS
Exploration costs incurred by Group companies, associates and joint
ventures are expensed in arriving at profit or loss for the period.
Investments made are capitalised as an asset where the underlying
projects have mineral resources which are compliant with
internationally recognised mineral resource standards (JORC and
NI 43-101) or where the investment is to acquire an interest in an
investment or associate that holds commercial information, assets
or strategic features against which a current commercial value can
be reasonably assessed.
The JORC Code, the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves, is a
professional code of practice that sets minimum standards for
public reporting of mineral exploration results, mineral resources
and ore reserves. NI 43-101 is a national instrument for the
Standards of Disclosure for Mineral Projects within Canada which
provides a codified set of rules and guidelines for reporting and
Metal Tiger plc
Annual Report & Accounts 2022
49
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
displaying information related to mineral properties owned by,
or explored by, companies which report these results on stock
exchanges within Canada.
TAXATION
Current taxation is the taxation currently payable on taxable profit
for the year.
Deferred income taxes are calculated using the liability method
on temporary differences. Deferred tax is generally provided
on the difference between the carrying amounts of assets and
liabilities and their tax bases. However, deferred tax is not provided
on the initial recognition of an asset or liability unless the related
transaction is a business combination or affects tax or accounting
profit. Temporary differences include those associated with shares
in subsidiaries and joint ventures and are only not recognised if
the Company controls the reversal of the difference and it is not
expected for the foreseeable future. In addition, tax losses available
to be carried forward as well as other income tax credits to the
Company are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting.
Deferred tax assets are recognised to the extent that it is probable
that the underlying deductible temporary differences will be able
to be offset against future taxable income. Current and deferred
tax assets and liabilities are calculated at tax rates that are expected
to apply to their respective period of realisation, provided they are
enacted or substantively enacted at the reporting date. Changes in
deferred tax assets or liabilities are recognised as a component of
tax expense in the Statement of Comprehensive Income, except
where they relate to items that are charged or credited to equity
in which case the related deferred tax is also charged or credited
directly to equity.
FOREIGN CURRENCY TRANSLATION
Transactions entered into by Group companies, in a currency other
than the currency of the primary economic environment in which
they operate (their “functional currency”) are recorded at the rates
ruling when the transactions occur. Foreign currency monetary
assets and liabilities are translated at the rates ruling at the
reporting date. Exchange differences arising on the retranslation
of unsettled monetary assets and liabilities are recognised
immediately in profit or loss.
Exchange gains and losses arising on the retranslation of monetary
financial assets are treated as a separate component of the change
in fair value and recognised in profit or loss. Exchange gains and
losses on non-monetary OCI financial assets form part of the overall
gain or loss in OCI recognised in respect of that financial instrument.
Translation into presentation currency.
• Assets and liabilities for each financial reporting date
presented (including comparatives) are translated at the
closing rate of that financial reporting period.
• Income and expenses for each income statement (including
comparatives) is translated at exchange rates at the dates
of transactions.
For practical reasons, the Company applies average exchange
rates for the period.
• All resulting changes are recognised as a separate component
of equity.
• Equity items are translated at exchange rates at the dates
of transactions.
INTANGIBLE ASSETS
Software Licences
Licences are stated at cost, less amortisation and provision for any
impairment. Amortisation is provided at rates calculated to write off
the cost of the software over its expected useful life as follows:
Software
10 years straight line
Gains and losses on disposals are determined by comparing the
disposal proceeds with the carrying amount and are included in
the Statement of Comprehensive Income in arriving at profit or
loss for the year.
INVESTMENTS IN JOINT VENTURES
A joint venture is a contractual arrangement whereby two or
more parties undertake an economic activity that is subject to
joint control. Joint control is the contractually agreed sharing of
control such that significant operating and financial decisions
require the unanimous consent of the parties sharing control. In
some situations, joint control exists even though the Company
has an ownership interest of more than 50% because joint venture
partners have equal control over management decisions. The
Company’s joint venture interests are held through one or more
Jointly Controlled Entities (a “JCE”). A JCE is a joint venture that
involves the establishment of a corporation, partnership or other
entity in which each venturer has a long term interest.
Exploration costs in respect of investments in associates and joint
ventures are capitalised or expensed according to the policy set
out above in respect of Group exploration costs. For associates
and joint ventures which are equity accounted for, any share of
losses are offset against cost of investment or loans advanced.
FINANCIAL ASSETS
The Company’s financial assets comprise investments held in
the Equity Investment at fair value, royalties receivable, trade
receivables and cash and cash equivalents.
OTHER FIXED ASSET INVESTMENTS
Other fixed asset investments comprise equity interests which are
not held for short term trading. The method of accounting for
these assets is set out under “Accounting for Equity Investment
Segmental Assets” below.
CURRENT ASSET INVESTMENTS
All investments, except those primarily held for strategic purposes,
as security for loans, or not for short term trading, are designated
as current asset investments. The method accounting for these
assets is set out below under “Accounting for Equity Investment
Segmental Assets”.
ACCOUNTING FOR EQUITY INVESTMENTS SEGMENTAL ASSETS
Investment transactions are accounted for on a trade date basis.
Incidental acquisition costs are expensed. Assets are derecognised
at the trade date of the disposal. Where investments are traded in
a liquid market, the fair value of the financial instruments in the
Statement of Financial Position is based on the quoted bid price
at the reporting date, with no deduction for any estimated future
selling cost. Non-traded investments are valued by the Directors
using primary valuation techniques such as, where possible,
comparable valuations, recent transactions, last price and net asset
value or, in the case of warrants, options and other derivatives on
the basis of third party quotation or specific investment valuation
models appropriate to the investment concerned.
Changes in the fair value of investments held at fair value through
profit or loss and gains and losses on disposal are recognised in
the Statement of Comprehensive Income.
Metal Tiger plc
50
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)
TRADE AND OTHER RECEIVABLES
Trade and other current asset receivables are recognised initially at
fair value and subsequently measured at amortised cost using the
effective interest method, less any provision for impairment. The
amount of any impairment provided is based on the expected loss
on an item-by-item basis for significant receivables and using a
risk-based provision matrix where appropriate.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash on hand and demand
deposits, together with other short term, highly liquid investments
that are readily convertible into known amounts of cash and which
are subject to an insignificant risk of changes in value.
IMPAIRMENT OF FINANCIAL ASSETS
The carrying values of the Company’s assets are reviewed annually
for any indicators of impairment. Where the carrying value of an
asset exceeds the recoverable amount (i.e. the higher of value
in use and fair value less cost to sell), the asset is written down
accordingly. Impairment charges are included in profit or loss,
except to the extent they reverse gains previously recognised in
other comprehensive income.
FINANCIAL LIABILITIES
The Company’s financial liabilities comprise trade and other
payables. Financial liabilities are obligations to pay cash or other
financial assets and are recognised when the Company becomes
a party to the contractual provisions of the instruments.
Trade and other payables are recognised initially at their fair value and
subsequently measured at amortised cost less settlement payments
SHARE BASED PAYMENTS
All share based payments are accounted for in accordance with
IFRS 2 – “Share based payments”. The Company issues equity-
settled share based payments in the form of share options and
warrants to certain Directors, employees and advisors. Equity-
settled share based payments are measured at fair value at the
date of grant. The fair value determined at the grant date of
equity-settled share based payments is expensed on a straight line
basis over the vesting period, based on the Company’s estimate of
shares that will eventually vest.
Equity-settled share based payments are made in settlement of
professional and other costs. These payments are measured at the
fair value of the services provided which will normally equate to
the invoiced fees and charged to the Statement of Comprehensive
Income, share premium account or are capitalised according to
the nature of the fees incurred.
Fair value is estimated using the Black-Scholes valuation model.
The expected life used in the model has been adjusted on the
basis of management’s best estimate for the effects of non-
transferability, exercise restrictions and behavioral considerations.
WARRANTS
Share warrants issued to shareholders in connection with share
capital issues are measured at fair value at the date of issue and
treated as a separate component of equity. Fair value is determined
at the grant date and is estimated using the Black-Scholes
valuation model. Share warrants issued separately to Directors,
employees and advisors are accounted for in accordance with the
policy on share based payments above.
EQUITY
Equity comprises the following:
“Share capital” representing the nominal value of equity shares;
“Share premium” representing the excess over nominal value of
the fair value of consideration received for equity shares, net of
expenses of the share issue;
“Share based payment reserve” representing the cumulative cost of
share based payments for options which are outstanding ;
“Warrant reserve” representing the outstanding cost of warrants
issued in connection with share capital issues; and
“Retained profits” representing retained profits.
The cost of the Company’s shares held by the Company for
treasury and subsequent cancellation are shown separately as
a deduction from total equity. The shares were transferred to
treasury shares and then cancelled in the prior year (see note 24).
Metal Tiger plc
Annual Report & Accounts 2022
51
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
3. SEGMENTAL INFORMATION
OPERATING SEGMENTS
Year ended 31 December 2022
Group
Equity
Investments
£’000
Project
Investments
£’000
Central
costs
£’000
Inter-
company
£’000
Total
£’000
COMPREHENSIVE INCOME
Net gain on investments
(5,071)
(949)
-
-
(6,020)
Intercompany sales
-
63
-
(63)
-
Administrative expenses
(77)
(484)
(2,109)
63
(2,607)
Net finance income/expense
395
1,130
424
-
1,949
Profit/(loss) for the year before taxation
(4,753)
(240)
(1,685)
-
(6,678)
Taxation
-
-
49
-
49
Profit/(loss) for the year after taxation
(4,753)
(240)
(1,636)
-
(6,629)
FINANCIAL POSITION
Intangible assets
-
18
-
-
18
Property, plant and equipment
-
145
-
-
145
Deferred tax asset
-
-
2,213
-
2,213
Royalties receivable
-
12,753
-
-
12,753
Total non-current assets
-
12,916
2,213
-
15,129
Current assets
24,565
450
1,059
-
26,074
Current liabilities
-
(257)
(6,628)
-
(6,885)
Non-current liabilities
-
(132)
(2,213)
-
(2,345)
Net assets
24,565
12,977
(5,569)
-
31,973
Equity Investments include strategic investments in resource exploration and development companies including equity and warrant holdings.
Project Investments are mainly by way of joint venture arrangements and include interests in precious, strategic and energy metals and
also house the net smelter return (“NSR”) royalty portfolio, with the last remaining project located in Botswana, having been sold in 2022,
the segment will be renamed Royalty segment in future years Central costs comprise those corporate costs which cannot be allocated
directly to either operating segment and include office rent, audit fees, AIM and ASX costs together with corporate employees and Directors’
remuneration relating to managing the business as a whole.
Metal Tiger plc
52
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
3. SEGMENTAL INFORMATION (continued)
OPERATING SEGMENTS
Year ended 31 December 2021
Group
Equity
Investments
£’000
Project
Investments
£’000
Central
costs
£’000
Inter-
company
£’000
Total
£’000
COMPREHENSIVE INCOME
Net gain on investments
3,368
(472)
-
-
2,896
Intercompany sales
-
46
-
(46)
-
Other income
-
5,214
-
-
5,214
Administrative expenses
(14)
(332)
(1,808)
46
(2,108)
Net finance income/expense
100
(48)
(1,839)
-
(1,787)
Profit/(loss) for the year before taxation
3,454
4,408
(3,647)
-
4,215
Taxation
-
-
(49)
-
(49)
Profit/(loss) for the year after taxation
3,454
4,408
(3,696)
-
4,166
FINANCIAL POSITION
Intangible assets
-
21
-
-
21
Property, plant and equipment
-
19
-
-
19
Deferred tax asset
-
-
2,164
-
2,164
Investment in joint ventures
-
2,873
-
-
2,873
Other fixed asset investments
3,506
-
107
-
3,613
Royalties receivable
-
10,593
-
-
10,593
Total non-current assets
3,506
13,506
2,271
-
19,283
Current assets
32,031
3,403
833
(3,111)
33,156
Current liabilities
(13)
(3,230)
(8,912)
3,111
(9,044)
Non-current liabilities
-
(118)
(4,455)
-
(4,573)
Net assets
35,524
13,561
(10,263)
-
38,822
Metal Tiger plc
Annual Report & Accounts 2022
53
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
3. SEGMENTAL INFORMATION (continued)
GEOGRAPHICAL SEGMENTS
Year ended 31 December 2022
Group
UK
£’000
EMEA
£’000
Asia-
Pacific
£’000
Australasia
£’000
Americas
£’000
Inter-
company
£’000
Total
£’000
COMPREHENSIVE INCOME:
Net (loss)/gain on investments
(64)
(918)
-
(4,342)
(696)
-
(6,020)
Intercompany sales
-
-
63
-
-
(63)
-
Administrative expenses
(1,989)
-
(415)
(216)
(50)
63
(2,607)
Net finance income/(expense)
(403)
2,158
296
(285)
183
-
1,949
(Loss)/profit on ordinary
activities before taxation
(2,456)
1,240
(56)
(4,843)
(563)
-
(6,678)
Taxation
49
-
-
-
-
-
49
Profit/(loss) for the year after taxation
(2,407)
1,240
(56)
(4,843)
(563)
-
(6,629)
FINANCIAL POSITION:
Intangible assets
-
-
18
-
-
-
18
Property, plant and equipment
-
-
145
-
-
-
145
Deferred tax asset
2,213
-
-
-
-
-
2,213
Royalties receivable
-
12,753
-
-
-
-
12,753
Total non-current assets
2,213
12,753
163
-
-
-
15,129
Current assets
1,303
-
460
24,065
246
-
26,074
Current liabilities
(205)
-
(257)
(6,423)
-
-
(6,885)
Non-current liabilities
(2,213)
-
(132)
-
-
-
(2,345)
Net assets
1,098
12,753
234
17,642
246
-
31,973
Metal Tiger plc
54
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
3. SEGMENTAL INFORMATION (continued)
GEOGRAPHICAL SEGMENTS (continued)
Year ended 31 December 2021
Group
UK
£’000
EMEA
£’000
Asia-
Pacific
£’000
Australasia
£’000
Americas
£’000
Inter-
company
£’000
Total
£’000
COMPREHENSIVE INCOME:
Net (loss)/gain on investments
49
(472)
-
3,545
(226)
-
2,896
Intercompany sales
-
-
46
-
-
(46)
-
Other income
-
5,214
-
-
-
-
5,214
Administrative expenses
(1,644)
(30)
(298)
(164)
(18)
46
(2,108)
Net finance income/(expense)
314
502
(528)
(2,077)
2
-
(1,787)
Profit/(loss) on ordinary
activities before taxation
(1,281)
5,214
(780)
1,304
(242)
-
4,215
Taxation
(49)
-
-
-
-
-
(49)
Profit/(loss) for the year after taxation
(1,330)
5,214
(780)
1,304
(242)
-
4,166
FINANCIAL POSITION:
Intangible assets
-
-
21
-
-
-
21
Property, plant and equipment
-
-
19
-
-
-
19
Deferred tax asset
2,164
-
-
-
-
-
2,164
Investment in joint ventures
-
2,873
-
-
-
-
2,873
Other fixed asset investments
107
-
-
3,506
-
-
3,613
Royalties receivable
-
10,593
-
-
-
-
10,593
Total non-current assets
2,271
13,466
40
3,506
-
-
19,283
Current assets
1,501
-
3,412
29,629
1,725
(3,111)
33,156
Current liabilities
(93)
-
(3,227)
(8,835)
-
3,111
(9,044)
Non-current liabilities
(2,213)
-
(117)
(2,243)
-
-
(4,573)
Net assets
1,466
13,466
108
22,057
1,725
-
38,822
Metal Tiger plc
Annual Report & Accounts 2022
55
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
4. MOVEMENT IN FAIR VALUE OF FAIR VALUE ACCOUNTED EQUITIES
2022
£’000
2021
£’000
Change in fair value of non-current asset investments (note 16)
-
1,469
Change in fair value of current asset investments (note 18)
(3,954)
(1,618)
(3,954)
(149)
5. INVESTMENT INCOME
Investment income comprises dividends received.
6. OTHER INCOME
2022
£’000
2021
£’000
Revaluation of the A4 Dome uncapped net royalty receivable initially recognised in 2020. (note 17).
-
5,214
7. OPERATING PROFIT
2022
£’000
2021
£’000
Profit from operations is arrived at after charging:
Wages and salaries (see note 8)
1,198
1,173
Share based payment expense – options
86
86
Amortisation of intangible assets
4
4
Depreciation
43
9
During the year the Group obtained the following services from the Company’s auditor:
2022
£’000
2021
£’000
Fees payable to the Company’s auditor for:
the audit of the Group’s financial statements
60
45
tax services*
9
11
other assurance services
-
10
* Performed by Audit firm independent of the external auditors.
Metal Tiger plc
56
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
8. EMPLOYEE AND DIRECTORS’ REMUNERATION
The expense recognised for employee benefits for continuing operations is analysed below:
2022
£’000
2021
£’000
Short term employee benefits (including Directors)
1,097
1,052
Pension costs
3
4
Social security costs
103
117
1,203
1,173
Share based remuneration
86
86
1,289
1,259
DIRECTORS’ REMUNERATION
2022
£’000
2021
£’000
Remuneration
492
491
Consultancy fees
-
-
Bonuses
265
280
Other benefits
23
11
780
782
Share based remuneration
49
49
829
831
Social security costs
72
90
901
921
Details of Directors’ employment benefits expense are as follows:
Name of Director
Remuneration
£ ‘000
Consultancy
fees
£’000
Bonuses
£’000
Pension
costs
£’000
Other
benefits
£’000
Total
2022
£’000
Total
2021
£’000
Charles Hall
85
-
30
-
3
118
138
Michael McNeilly
187
-
150
-
14
351
339
Mark Potter
150
-
70
-
6
226
225
Neville Bergin
35
-
10
-
-
45
45
David Wargo
35
-
5
-
-
40
35
492
-
265
-
23
780
782
Details of share options and warrants granted to Directors during the year are given in note 25.
Average number of persons employed during the year:
2022
Number
2021
Number
Project Investment operations
3
1
Office and management
7
7
10
8
Key management are the Directors and Officers of the Company.
Metal Tiger plc
Annual Report & Accounts 2022
57
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
9. FINANCE INCOME
2022
£’000
2021
£’000
Bank interest
36
-
Accretion of discount on royalty’s receivable (see note 17)
881
467
Change in value of derivatives held for financing
876
-
Foreign exchange gains
1,061
-
2,854
467
10. FINANCE COSTS
2022
£’000
2021
£’000
Bank interest
905
485
Net change in value of derivatives and price resets on loans held for financing
-
1,269
Foreign exchange losses
-
500
905
2,254
11. TAXATION
2022
£’000
2021
£’000
Current tax on income for the year
-
-
Deferred tax
49
(49)
Total tax charge for the year
49
(49)
The tax on the Groups on the Groups profit before tax differs from the theoretical amount that would arise using the weighted average rate
applicable to the profits of the Group or Company as follows:
Factors affecting the tax charge
2022
£’000
2021
£’000
(Loss)/profit before tax
(6,678)
4,215
Profit before tax multiplied by rate of corporation tax in the UK of 19% (2021: 19%)
1,269
(801)
Overseas profits/losses taxed at different rates
(40)
(48)
Changes in rate at which deferred tax is provided
(11)
103
Chargeable (gains)/losses arising
219
(514)
Income not chargeable to tax
-
639
Expenses not allowable for tax
(1,025)
(40)
Unprovided prior year deferred tax
24
-
Deferred tax gains and losses not recognised
(387)
612
Total tax
49
(49)
Metal Tiger plc
58
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
11. TAXATION (continued)
Movements in deferred tax assets and liabilities during the year and the amounts outstanding at the year end are as follows:
Deferred tax asset/(liability)
Assets
£’000
Liabilities
£’000
Net
£’000
At 1 January 2021
-
-
-
Adjustment for prior years
909
(909)
-
Charge for the year
1,255
(1,304)
(49)
At 31 December 2021
2,164
(2,213)
(49)
Adjustment for prior years
(24)
-
(24)
Charge for the year
73
-
73
At 31 December 2022
2,213
(2,213)
-
Deferred tax asset is provided to the extent that it will be utilised by originating timing differences upon which the deferred tax liability was
raised. The remaining unrecognised tax losses carried forward of approximately £2,7,00,000 of which £800,000 relate to subsidiaries in
Thailand and expire over the period to 31 December 2027.
12. PROFIT ACCOUNTED FOR IN THE PARENT COMPANY
As permitted under Section 408 of the Companies Act 2006, a Statement of Comprehensive Income for the Company is not presented as
part of these financial statements.
13. EARNINGS PER SHARE
The basic earnings per share is based on the profit for the year divided by the weighted average number of shares in issue during the year.
The weighted average number of ordinary shares for the year assumes that all shares have been included in the computation based on the
weighted average number of days since issue.
2022
£’000
2021
£’000
(Loss)/Earnings attributable to equity holders of the Company:
Continuing and total operations
(6,629)
4,166
No of shares
Weighted average number of ordinary shares in issue for basic earnings
169,423,576
160,776,895
Weighted average of exercisable share options and warrants
-
-
Weighted average number of ordinary shares in issue for fully diluted earnings
169,423,576
160,776,895
No share options and warrants outstanding on 31 December 2022 were dilutive as the exercise price of any share options or warrants
outstanding at 31 December 2022 was higher than the average market price of ordinary shares during the year. Accordingly, all such potential
ordinary shares have been excluded from the weighted average number of ordinary shares in calculating diluted earnings per share as at 31
December 2022.
No share options and warrants outstanding on 31 December 2021 were dilutive as the exercise price of any share options or warrants
outstanding at 31 December 2021 was higher than the average market price of ordinary shares during the year. Accordingly, all such potential
ordinary shares have been excluded from the weighted average number of ordinary shares in calculating diluted earnings per share as at 31
December 2021.
2022
Pence per share
2021
Pence per share
(Loss)/Earnings per ordinary share - basic:
Continuing and total operations
(3.91)
2.59
Earnings per ordinary share - fully diluted:
Continuing and total operations
(3.91)
2.59
Metal Tiger plc
Annual Report & Accounts 2022
59
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
14. SUBSIDIARY UNDERTAKINGS
The following were subsidiary undertakings at the end of the year. All subsidiaries have year ends which are coterminous with that of the
parent Company. Except where indicated all companies are engaged in mineral exploration. Metal Tiger plc controls those companies where
its proportion of voting rights is less than 50% by virtue of shareholder agreements.
Name
Registered office
Country of
incorporation
or registration
Effective
dividend
rights held
Type of
shares held
Proportion of
voting rights
and ordinary
share capital held
KEMCO Mining plc*
(non-trading)
Weston Farm House
Weston Down Lane
Hampshire SO21 3AG
UK
England
and Wales
100%
Ordinary
100%
Metal Tiger Australia Pty Limited*
(non-trading)
Level 32
152 St Georges Terrace
West Perth
WA 6000
Australia
Australia
100%
Ordinary
100%
Metal Tiger Exploration
and Mining Co. Ltd
Metal Tiger IHQ Co. Ltd.*
Metal Group Co. Ltd.
Metal Tiger Resources Co. Ltd.
98 Sathorn Square
Office Tower
Room N0. 140114th Floor
North Sathorn Road,
Silom, Bangrak
Bangkok, 10500
Thailand
Thailand
100%
Ordinary
Preference
49%
100%
100%
Ordinary
100%
99%
Ordinary
49%
100%
Ordinary
88%
* Directly owned by the Company.
INVESTMENT IN SUBSIDIARY UNDERTAKINGS
Company
2022
£’000
2021
£’000
At 1 January
564
564
Increase in capital
-
-
Provision against investment
(564)
At 31 December
-
564
Metal Tiger plc
60
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
15. INVESTMENT IN JOINT VENTURES
The companies in which Metal Tiger’s joint venture interests are held are set out below. All are engaged in mineral exploration.
Joint Venture
Registered office
Country of
incorporation
or registration
Principal place
of business
Proportion of ownership
interest and voting rights held
by the Group/Company
31 Dec 2022
31 Dec 2021
Held directly:
Kalahari Metals Limited
25-29 Maddox Street
London W1S 2PP UK
UK
UK
0%
49%/49%
* On 30 November 2022 the remaining 49% interest in Kalahari Metals Limited was sold. Prior thereto it was regarded as a joint venture as a
shareholder agreement precluded Metal Tiger from exercising control over the company accordingly its voting rights were effectively limited
to 49% up until sale date (2021:49%).
Group and Company
Cost of
investment
£’000
Loan advances
£’000
Total
£’000
At 1 January 2021
3,198
-
3,198
(Disposals)/Additions in the year
(672)
840
168
Share of losses
(493)
-
(493)
At 31 December 2021
2,033
840
2,873
Disposals in the year
(1,084)
(962)
(2,046)
Share of losses
(116)
-
(116)
Loss on sale
(833)
-
(833)
Translation differences
-
122
122
At 31 December 2022
-
-
-
The fair value of investments in joint ventures at the yearend is considered by the Directors not to be materially different to the carrying amounts.
Metal Tiger plc
Annual Report & Accounts 2022
61
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
15. INVESTMENT IN JOINT VENTURES (continued)
The consolidated results and net assets of Kalahari Metals Limited were as follows:
2022
£’000
2021
£’000
Impairment in carrying value of exploration licences
-
(860)
Operating costs
(27)
(149)
Finance income/(expense)
(209)
13
Loss before taxation
(236)
(996)
Tax on loss on ordinary activities
-
-
Loss for the year
(236)
(996)
2022
£’000
2021
£’000
Non-current assets
-
3,926
Non-current liabilities
-
(1,719)
Current liabilities
-
(69)
Net assets
-
2,138
The Company’s remaining holding in Kalahari Metals Limited was sold on 30 November 2022.
Metal Tiger plc
62
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
16. OTHER NON-CURRENT ASSET INVESTMENTS
Year ended 31 December 2022
Group and Company
Equity
investments
£’000
Derivatives
£’000
Other fixed asset
investments
£’000
Total
£’000
At 1 January – at fair value
4,125
(619)
107
3,613
Transfer (to)/from current assets
(4,125)
619
-
(3,506)
Movement in fair value/(provided against)
-
-
(107)
(107)
At 31 December – at fair value
-
-
-
-
Year ended 31 December 2021
Group and Company
Equity
investments
£’000
Derivatives
£’000
Other fixed asset
investments
£’000
Total
£’000
At 1 January – at fair value
8,575
444
107
9,126
Transfer from current assets
(5,919)
259
-
(5,660)
Movement in fair value
1,469
(1,370)
-
99
Translation differences
-
48
-
48
At 31 December – at fair value
4,125
(619)
107
3,613
Categorised as:
Level 1 - Quoted investments
4,125
-
-
4,125
Level 3 - Unquoted equity/derivatives
-
(619)
107
(512)
4,125
(619)
107
3,613
The tables of investments above set out the fair value measurements using the IFRS 13 fair value hierarchy. Categorisation within the hierarchy
has been determined on the basis of the lowest level of input that is significant to the fair value measurement of the relevant asset as follows:
Level 1 - valued using quoted prices in active markets for identical assets;
Level 2 - valued by reference to valuation techniques using observable inputs other than quoted prices included within Level 1; and
Level 3 - valued by reference to valuation techniques using inputs that are not based on observable market data.
The maximum credit risk as regards these investments is not considered to be materially different from the carrying value of those investments.
During the year all the 1,167,542 shares held as part of the investment in Sandfire Resources NL at the beginning of the year were transferred
to current assets, matching the repayment profile of the bank loans the shares are held as security for, the financing arrangement for the bank
loan includes a put/call option over these shares as set out more fully in Note 18.
OTHER NON-CURRENT FIXED ASSET INVESTMENTS
Other non-current fixed asset investments comprise an investment in Sita Capital Partners LLP, an asset management partnership which is
not held for short term. Mr Mark Potter, a Director of the Company, is the controlling partner of Sita Capital Partners LLP. The Directors of the
Company decided to fully provide against this investment during the year.
Metal Tiger plc
Annual Report & Accounts 2022
63
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
17. ROYALTIES RECEIVABLE
Group and Company
T3
£’000
A4
£’000
Total
£’000
At 1 January 2021
1,228
3,638
4,866
Acquisitions/revaluations in the year – Other income
-
5,214
5,214
Net accretion of discount on acquisition*
74
393
467
Translation effects
13
33
46
At 31 December 2021
1,315
9,278
10,593
Net accretion of discount on acquisition*
78
803
881
Periodic revaluation- Other income
-
-
-
Translation effects
169
1,110
1,279
At 31 December 2022
1,562
11,191
12,753
*will reflect assumptions pertaining to timings of cash flow since last valuation at appropriate discount rates.
The T3 royalty receivable relates to the T3 project in Botswana previously owned in the Metal Capital Ltd joint venture sold to MOD Resources
Ltd in 2018 and ultimately Sandfire. The royalty is capped at US$2m and is expected to result in a receipt thereof in the final quarter of 2023.
The A4 royalty is an uncapped 2% Net Smelter Return royalty over the any future production over the A4 deposit situated in Botswana and
owned by Sandfire. In initially assigning a value to the royalty in 2020, the Company relied inter alia on the announcement released by Sandfire
to the market on 1 December 2020.
The Company again predominantly relied on the announcement released by Sandfire to the market on 2 September 2021 together with other
consensus information readily available in the market to determine the revised carrying value of the royalty as of 31 December 2021.
As a consequence of there being no significant market announcements on the size and extent of the resource over the A4 royalty during
the year ended 31 December 2022 the Company tested the carrying value based on the unadjusted resource size, whilst iterating for the
likely adjusted cash flow timelines and the relevant periods consensus copper price information readily available in the market, the Company
determined the carrying value as of 31 December 2021, adjusted for the release of the accretion of the time value of money discount and
translation effects, remains appropriate as of 31 December 2022.
The following table illustrates the key considerations and assumptions the Group considered in determining the value of the royalty by using
the net present value of the cash flows expected from the royalty as discounted, the key considerations included.
2022
£’000
2021
£’000
Resource size
MT
9,700,000
9,700,000
Resource Grade
Copper
1.17%
1.17%
Medium term copper price- weighted average
US$/MT
9,593
9,078
Mining recovery rate
Copper
92.3%
92.3%
Concentrate recovery
Copper
92.2%
92.2%
Medium date at which time 50% of the royalty will have been received
3rd Quarter 2027
3rd Quarter 2025
Discount rate
7%
7%
The following table illustrates the sensitivity of the net value of the A4 royalty, to changes to the material valuation components:
CHANGE IN EQUITY
2022
£’000
2021
£’000
5% Increase in Resource size
560
462
5% Decrease in Resource size
(560)
(462)
5% Increase in medium term copper price
560
462
5% Decrease in medium term copper price
(560)
(462)
Cash flow commencement date 1 year earlier
710
606
Cash flow commencement date 1 year later
(710)
(606)
Metal Tiger plc
64
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
18. CURRENT ASSET INVESTMENTS
2022
Group and
Company
£’000
2021
Group and
Company
£’000
At 1 January – investments at fair value
32,031
20,768
Acquisitions
8,034
18,676
Disposal proceeds
(14,600)
(13,434)
Transfers from/(to) non-current assets
3,506
5,660
(Loss)/Gain on disposal of investments
(1,156)
1,979
Movement in fair value of investments
(3,250 )
(1,618)
At 31 December – investments at fair value
24,565
32,031
Categorised as:
Level 1 – Quoted investments
24,522
31,262
Level 3 – Unquoted - equity
114
212
Level 3 – Unquoted – share warrants/
102
816
Level 3 – Unquoted – derivatives structured loan
(173)
(259)
24,565
32,031
The current asset investments includes 1,167,542 (2021: 1,675,125) ordinary shares in the capital of Sandfire Resources NL (“Sandfire”) which is
traded on the Australian ASX market. This investment is held as security, via a stock lending arrangement, for a portion of the Group’s non-
current bank loans with maturity dates ranging from 18 May 2023 and 8 December 2023 (see note 22). The financing arrangement for the
bank loan includes a put/call option over these shares as set out below.
DERIVATIVES
As part of the financing arrangements for the Group’s bank loan, the Company has entered a put/call arrangements whereby it has:
(a) obtained the right (but not the obligation) to sell 1,167,542 Sandfire shares to the lender at the expiry of the loans on ranging between 18
May 2023 and 8 December 2023 at strike prices which range between A$2.93 and A$4.02 with the weighted average strike price being
A$3.49 (subject to customary adjustments), and
(b) granted the lender the right (but not the obligation) to buy 1,167,542 Sandfire shares from the Company at the same date at strike prices
which range between A$5.80 and A$8.19 with the weighted average strike price being A$6.83.
The Company may elect to settle the put/call by way of physical delivery of Sandfire shares or by way of a cash payment reflecting the value of
the put and call at the time.
The derivative has been recorded initially at cost and revalued by the lending bank at the yearend by reference to Level 3 data under the IFRS13
fair value hierarchy.
The table of investments sets out the fair value measurements using the IFRS 13 fair value hierarchy. The explanation of the hierarchy is given in
note 16.
The maximum credit risk as regards these investments is not considered to be materially different from the carrying value of those investments.
Metal Tiger plc
Annual Report & Accounts 2022
65
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
18. CURRENT ASSET INVESTMENTS (continued)
LEVEL 3 FINANCIAL ASSETS
Reconciliation of Level 3 fair value measurement of financial assets:
2022
Group and
Company
£’000
2021
Group and
Company
£’000
At 1 January
769
951
Purchases
287
572
Transfer to Level 1/from non-current assets
(620)
(259)
Disposal proceeds
(401)
(184)
Loss on disposal of investments
(176)
(42)
Movement in fair value
239
(269)
Translation effects
(55)
-
At 31 December
43
769
Level 3 valuation techniques used by the Group are explained in note 2 (fair value of investments). The following key input has been used
in the valuation model: volatilities ranging between 56% and 198% depending on the investment (2021: 49% to 142%). A 20% increase in the
volatility estimate would result in a £24,000 increase in the fair value (2021: £133,000) and a 20% decrease would result in a £22,000 decrease
in fair value (2021: £131,000).
19. TRADE AND OTHER RECEIVABLES
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
Tax and social security
192
-
159
-
Other receivables
122
58
48
31
Prepayments and accrued income
310
143
270
168
624
201
477
199
The fair value of trade and other receivables, using the expected credit loss model, is considered by the Directors not to be materially different
to carrying amounts.
20. CASH AND CASH EQUIVALENTS
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
Cash at investment brokers
315
315
168
168
Cash at bank
570
545
480
467
885
860
648
635
The fair value of cash and cash equivalents is considered by the Directors not to be materially different to carrying amounts.
21. TRADE AND OTHER PAYABLES
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
Trade payables
165
165
36
38
Tax and social security
16
16
24
24
Other payables
56
44
58
43
Accrued charges
357
165
194
139
594
390
312
244
The fair value of trade and other payables is considered by the Directors not to be materially different to carrying amounts.
Metal Tiger plc
66
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
22. LOANS AND BORROWINGS
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
Current liabilities
6,291
6,241
8,732
8,686
Non-current liabilities
-
-
2,242
2,242
6,291
6,241
10,974
10,928
CURRENT LIABILITIES – Loans and borrowings
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
At 1 January
8,732
8,686
52
-
Net cash flows from financing activities
(2,775)
(2,775)
4,829
4,829
Drawn down in the year
4,620
4,620
4,829
4,829
Repayments in the period
(7,395)
(7,395)
-
-
Transfer to current liabilities – Loans and borrowings
2,242
2,242
3,853
3,853
Translation differences*
(1,908)
(1,912)
(2)
4
At 31 December
6,291
6,241
8,732
8,686
*non - cash flow
The Company has secured loans in aggregate of A$4,084,612, (2021: A$11,351,476) from a banking institution which is secured by reference to
the stock loan over shares in Sandfire and the associated put/call derivative, see note 18.
The loans are repayable in full on the following dates:
2022
Group and
Company
£’000
2021
Group and
Company
£’000
16 December 2022
-
3,853
8 May 2023
542
530
9 June 2023
556
543
10 July 2023
559
545
7 July 2023
83
81
8 December 2023
560
544
2,300
6,096
Also included in the amount owing is a loan amounting to A$7,001,306 (2021: A$9,000,000) which is secured by a collateral agreement over
4,762,626 (2021: 4,714,286) shares in the capital of Sandfire and attracts interest at a floating rate determined to be the quoted 30 day BBSY
Bid plus a margin of 8%, which equated to an interest rate of 11.01% at 31 December 2022 (2021:10%)
The loan is repayable in full on 15 December 2023, with the Company having the option to extend the repayment date to 15 December 2024
at a fee of 3% of the revolving maximum facility commitment of A$15,000,000.
Metal Tiger plc
Annual Report & Accounts 2022
67
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
23. CONTINGENT CONSIDERATION
On 16 February 2016, the Company exercised its option to acquire the remainder of the Thai based assets of Southeast Asia Mining
Corporation (“SEAM”), comprising its investment in Southeast Asia Exploration and Mining Co. Ltd (now called Metal Tiger Exploration
and Mining Co. Ltd.) and certain fellow subsidiaries, to provide an increased portfolio of base metal interests in Thailand through joint
venture interests with Boh Yai Mining Company Ltd. in Thailand. The consideration was a cash payment of US$200,000 and a payment
of US$300,000 in 23,799,000 new ordinary shares of the Company. A potential further cash payment of US$100,000 and a US$60,000
working capital contribution may be issued to SEAM subject to the grant of the primary target prospecting licence 1/2557 in the Kanchanaburi
province in Western Thailand.
24. SHARE CAPITAL
CALLED UP, ISSUED AND FULLY PAID
Number of
ordinary shares
Share
capital
£’000
Capital
Redemption
£’000
Share
premium
£’000
At 1 January 2021
153,311,625
153
4
12,831
Share issues
13,513,514
14
-
2,645
Warrant exercised
2,598,437
3
-
529
Share issue expenses
-
-
-
(301)
At 31 December 2021
169,423,576
170
4
15,704
Share issues
-
-
-
-
Warrant exercised
-
-
-
-
Share issue expenses
-
-
-
-
At 31 December 2022
169,423,576
170
4
15,704
22. LOANS AND BORROWINGS (continued)
NON-CURRENT LIABILITIES – Loans and borrowings
2022
Group
£’000
2022
Company
£’000
2021
Group
£’000
2021
Company
£’000
At 1 January
2,242
2,242
7,051
7,051
Net cash flows from financing activities
-
-
(618)
(618)
Drawn down in the year
-
-
-
-
Repayments in the period
-
-
(618)
(618)
Transfer to current liabilities – Loans and borrowings
(2,242)
(2,242)
(3,853)
(3,853)
Translation differences*
-
-
(338)
(338)
At 31 December
-
-
2,242
2,242
*non - cash flow
Metal Tiger plc
68
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
24. SHARE CAPITAL (continued)
SHARE ISSUES
There were no shares issued or cancelled during the year.
In 2021 as announced on the 26 July 2021, pursuant to existing capacity from its Annual General Meeting, and further to it the authority
granted to the company by way of a General Meeting resolution on 19 September 2020 the company issued an aggregate of 13,513,514
new ordinary shares.
The following issues of ordinary shares of 0.01p took place in the 2021 financial year:
Date
Issue price*
(p)*
Number
issued
Amount gross
£’000
6 August 2021
Placing
19.67 *
10,810,811
2,127
24 September 2021
Placing
19.67 *
2,702,703
532
Various dates
Exercise of warrants
20.45**
2,598,437
532
Total issued for cash
16,111,951
3,191
* p equivalent
** Average price
Details of warrants issued with the placing are given in note 25.
SHARE BUY-BACKS
During the year, there were no share buy-backs (2021: Nil).
25. SHARE OPTIONS AND WARRANTS
SHARE OPTIONS
2022
2021
Number
Weighted average
exercise price
(p)
Number
Weighted average
exercise price
(p)
At 1 January
15,550,000
40.93
15,550,000
40.93
Issued in year
-
-
-
-
Cancelled or expired in year
(1,200,000)
60
-
-
At 31 December
14,350,000
39.34
15,550,000
40.93
Exercisable at 31 December
12,180,000
41.13
13,370,968
43.12
Average life remaining at 31 December
2.1
2.89 years
There were no options issued/amended during the year.
Metal Tiger plc
Annual Report & Accounts 2022
69
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
25. SHARE OPTIONS AND WARRANTS (continued)
Options outstanding to Directors at 31 December 2021 are as follows:
Current Directors at the year end:
Exercise price
(p)
At 1 January
Number
Granted/(Cancelled or Expired)
Number
At 31 December
Number
Charles Hall
35
300,000
-
300,000
45
450,000
-
450,000
60
500,000
-
500,000
27.5
200,000
-
200,000
Michael McNeilly
20
-
-
-
30
750,000
-
750,000
35
1,000,000
-
1,000,000
45
1,500,000
-
1,500,000
60
1,000,000
-
1,000,000
27.5
1,000,000
-
1,000,000
Mark Potter
30
-
-
-
35
1,000,000
-
1,000,000
45
1,500,000
-
1,500,000
60
400,000
-
400,000
27.5
600,000
-
600,000
Neville Bergin – resigned 31 January 2023
35
200,000
-
200,000
45
300,000
-
300,000
27.5
200,000
-
200,000
David Wargo
27.5
200,000
-
200,000
10,350,000
-
10,350,000
The total share based payment expense recognised in the income statement for the year ended 31 December 2021 in respect of options granted
was £86,000 (2021: £86,000).
PLACING WARRANTS
2022
2021
Number
Weighted average
exercise price
(p)
Number
Weighted average
exercise price
(p)
At 1 January
17,651,666
57.476
51,196,433
45.32
Issued in year (see below)
-
-
1,000,000
30.00
Exercised in year
-
-
(2,598,437)
20.45
Expired in year
(16,651,666)
59.126
(31,946,330)
41.028
At 31 December
1,000,000
30
17,651,666
57.476
Exercisable at 31 December
1,000,000
30
17,651,666
57.476
Average life remaining at 31 December
1,58 years
0.452 years
There were no warrants issued during the 2022 financial year.
Metal Tiger plc
70
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
25. SHARE OPTIONS AND WARRANTS (continued)
The warrants issued during 2021 year were in connection with the placings of the Company’s ordinary shares as detailed in note 24 and
have been charged as a component of equity. The fair values of the warrants were determined using the Black-Scholes pricing model. The
significant inputs to the model were as follows:
Warrants for advisory services
Grant date
20 July 2021
Share price at date of grant
23.50p
Exercise price per share
30.00p*
No. of warrants granted
1,000,000
Risk free rate
1%
Expected volatility
64%
Life of warrant
3 years
Calculated fair value per share warrant
8.4p
*equivalent at time of grant
26. FINANCIAL INSTRUMENTS
CAPITAL RISK MANAGEMENT
The Group manages its capital to ensure that it will be able to continue as a going concern while maximising the return to shareholders
through the optimisation of debt and equity funding. Currently the Company’s capital structure consists entirely of shareholders’ equity,
comprising issued share capital and reserves.
The Company uses financial instruments to provide funding for its operations. The derivatives held by the Company, as set out in note 17 are
used to provide for a partial hedge in changes in the value of the market investments used to secure the Company’s long-term loan (note 22).
The main risks arising from the Company’s financial instruments are credit risk, liquidity risk, market risk and foreign exchange risk. The
Company does not have any significant other risks. The Directors agree policies for managing these risks and they are summarised below.
CREDIT RISK
The Group’s exposure to credit risk is limited to the carrying amounts of trade and other receivables, and cash and cash equivalents recognised
at the reporting date, as follows:
2022
£’000
2021
£’000
Trade and other receivables
122
48
Cash and cash equivalents
885
648
1,007
696
The Group’s management considers that all the above financial assets that are not impaired for each of the reporting dates under review are
of good credit quality, including those that are past due.
No impairment provision was required against trade and other receivables in the year (2021: Nil). None of the Group’s financial assets are
secured by collateral or other credit enhancements.
The credit risk for cash and cash equivalents is considered negligible, since the counterparties are reputable banks with high quality external
credit ratings.
Metal Tiger plc
Annual Report & Accounts 2022
71
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
26. FINANCIAL INSTRUMENTS (continued)
LIQUIDITY RISK
The Group makes both short term and long-term investments. Short term investments are principally quoted investments and such
investments may be sold to meet the Group’s funding requirements. The market in small capitalised companies may at times prove to have
pockets of illiquidity, particularly at times when the markets are distressed which is somewhat mitigated by the diversity of the portfolio.
Long term investments include quoted and unquoted investments, derivatives and joint ventures through unquoted investment vehicles.
Unquoted investments, including joint ventures, are subject to greater liquidity risk. Directors perform extensive due diligence prior to
investment in joint ventures.
As the Group has no significant interest bearing assets, the Group’s income and operating cash flows are substantially independent of
changes in market interest rates.
The following table shows the contractual maturities of the Group’s financial liabilities, including repayments of both principal and interest
where applicable:
2022
£’000
2021
£’000
Trade and other payables due in 6 months or less
237
118
Loan repayable on demand
-
46
Loan repayable between 0-1 year
6,291
8,686
Loan repayable between 1- 2 years
-
2,242
Total contractual cash flows
6,528
11,092
As set out in notes 16 and 22, the loans repayable during the ensuing year together with the loans payable thereafter are either secured by
quoted equity investment held by the Company and pricing risk is partially protected by means of a derivative cap/collar, or by means of
adequate collateral coverage.
Equity investments included in current assets comprising predominately of liquid listed shares amount to £24,565,000. The cover ratio of 3.8
times is deemed more than sufficient in the circumstances by the Directors.
MARKET RISK
The Company is exposed to market risk as a result of investing in listed resource companies. The fair value of each investment will fluctuate as
a result of factors specific to the investment. The Company actively reviews its portfolio of investments to manage this risk. An increase of 10%
in the valuation of listed investments held at the year end would increase the profit before tax for the year by £2,452,000 (2021: £3,538,000).
FOREIGN CURRENCY RISK
The Group is exposed to movements in exchange rates in respect of equity investments, derivatives, overseas subsidiaries, investments in joint
ventures and associates, and cash held in foreign currencies.
The following table illustrates the sensitivity of net assets to changes in currency exchange rates at the year end where there is a material
exposure to that currency:
CHANGE IN EQUITY
2022
£’000
2021
£’000
5% Increase in A$ fx rate against GBP
916
1,121
5% Decrease in A$ fx rate against GBP
(916)
(1,121)
5% Increase in US$ fx rate against GBP
631
667
5% Decrease in US$ fx rate against GBP
(631)
(667)
Exposure to foreign exchange rates varies during the year depending on the volume and nature of foreign transactions. Nonetheless, the
analysis above is considered to be representative of the Group’s exposure to currency risk.
Metal Tiger plc
72
Annual Report & Accounts 2022
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
26. FINANCIAL INSTRUMENTS (continued)
CATEGORIES OF FINANCIAL INSTRUMENTS
The IFRS 9 categories of financial assets and liabilities included in the Statement of Financial Position and the headings in which they are
included are as follows:
Year ended 31 December 2022
Current assets
and liabilities
£’000
Non-current assets
and liabilities
£’000
Total
£’000
FINANCIAL ASSETS HELD AT AMORTISED COST
Cash and bank balances
885
-
885
Loans and receivables
314
-
314
FINANCIAL ASSETS HELD AT FAIR VALUE
Royalties receivable
-
12,753
12,753
Equity investments accounted for under fair value
24,565
-
24,565
FINANCIAL LIABILITIES HELD AT AMORTISED COST
Trade and other payables
237
-
237
Loans and borrowings
6,291
-
6,291
Year ended 31 December 2021
Current assets
and liabilities
£’000
Non-current assets
and liabilities
£’000
Total
£’000
FINANCIAL ASSETS HELD AT AMORTISED COST
Cash and bank balances
648
-
648
Loans and receivables
208
-
208
FINANCIAL ASSETS HELD AT FAIR VALUE
Royalties receivable
-
10,593
10,593
Other non-current asset investments
-
107
107
Equity investments accounted for under fair value
32,031
3,506
35,537
FINANCIAL LIABILITIES HELD AT AMORTISED COST
Trade and other payables
118
-
118
Loans and borrowings
8,732
2,242
10,974
Metal Tiger plc
Annual Report & Accounts 2022
73
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
27. RELATED PARTY TRANSACTIONS
GROUP AND PARENT COMPANY
A list of significant shareholders is included in the Report of the Directors. No ultimate controlling party has been identified by the Directors.
Details of the Directors’ remuneration and consultancy fees are disclosed in note 8. In the opinion of the Board, only the Directors of the
parent Company are to be regarded as key employees.
No amounts were owed by any Director to the Group at 31 December 2022 or 31 December 2021.
The following amounts were owed by the Group to Directors at the year end in respect of expenses and outstanding salaries:
2022
£’000
2021
£’000
Charles Hall
-
-
Michael McNeilly
-
-
Mark Potter
-
-
Neville Bergin
3
3
David Wargo
3
3
PARENT COMPANY TRANSACTIONS WITH SUBSIDIARIES
The Company charged Metal Tiger Exploration and Mining Co. Ltd. £Nil (2021: £42,000) during the year in respect of fees for consultancy
services and for travel and similar costs incurred in respect of their operations and £26,000 (2021: £24,000) in respect of interest on
outstanding charges.
In addition, the Company has funded the operations of subsidiaries during the year.
Subsidiary
Amounts due to the
Company at
31 December 2022
£’000
Amounts due to the
Company at
31 December 2021
£’000
KEMCO Mining plc
-
-
Metal Tiger Exploration and Mining Co. Ltd.
1,511
1,405
Metal Tiger IHQ Co. Ltd.
1,839
1,343
Metal Group Co. Ltd.
401
343
Metal Tiger Resources Co. Ltd.
22
20
Metal Tiger Australia Pty Limited
-
-
3,772
3,111
The Company has provided in full against the amounts receivable in 2022.
The Company was charged £63,000 (2021: £45,000 during the year by Metal Tiger IHQ Co Ltd. In respect of office and administration costs
relating to Group services.
No amounts were due by the Company to its subsidiary companies. Amounts due from subsidiary companies included within current assets
and current liabilities represent amounts advanced for operational activities and repayable on demand and interest free or for management
fees and interest thereon and are repayable on normal commercial terms.
PARENT COMPANY TRANSACTIONS WITH ASSOCIATES AND JOINT VENTURES
Details of transactions with associates and joint ventures are given in notes 14 and 15 respectively.
Company and Group
2022
£’000
2021
£’000
Amounts due by the Company and Group at 31 December:
Kalahari Metals Limited
-
840
The amount owing to in 2021 represented amounts relating to the investment made during the year which has been included as part of the
investment in joint ventures reflecting the substance of the loan.
Metal Tiger plc
74
Annual Report & Accounts 2022
28. POST YEAR END EVENTS
Cobre Investment
The Company has committed to subscribe to 6,666,667 Shares in Cobre at a Placement issue price of A$0.15 per
share subject to Shareholder Approval. The meeting of the Shareholders took place on the 24 March 2023, with
the sough authority being then given and settlement of the subscription is due to take place imminently.
Sandfire Resources Limited
The Company reduced its net investment in SFR since the year end by 532,626 shares in the SC Lowy structure, realising £1,873,396.
AIM Cancellation
On 2 March 2023 the Company announced it the proposed cancellation of its admission to the AIM market, to be effective on 31 March 2023
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Metal Tiger plc
Annual Report & Accounts 2022
75
COMPANY INFORMATION
DIRECTORS :
Charles Patrick Stewart Hall
(Non-Executive Chairman)
David Michael McNeilly
(Chief Executive Officer)
Mark Roderick Potter
(Chief Investment Officer) (Resigned 12 March 2023)
Neville Keith Bergin
(Non-Executive Director) (Resigned 31 January 2023)
David Alan Wargo
(Non-Executive Director)
SECRETARY AND
CHIEF FINANCIAL OFFICER :
Adrian Lee Bock
CA (SA), ACA , MCSI
REGISTERED OFFICE :
Weston Farm House,
Weston Down Lane,
Weston Colley,
Hampshire SO21 3AG
AUSTRALIAN OFFICE :
c/o Elderton Pty Ltd, Level 32,
152 St Georges Terrace, Perth,
WA,6000, +61 8 6324 2900
COMPANY
REGISTRATION NUMBER :
04196004
REGISTRAR AND
TRANSFER OFFICE
UNITED KINGDOM:
Link Group
10th Floor, 29 Wellington Street,
Leeds LS1 4DL
+44 0 371 664 0300
REGISTRAR AND
TRANSFER OFFICE
AUSTRALIA:
Link Market Services Limited
Level 12
680 George Street
Sydney NSW 2000
+61 1300 554 474
BANKERS :
NatWest Bank plc
180 Brompton Road,
London SW3 1HL
SOLICITORS :
Simmons & Simmons LLP
Citypoint, 1 Ropemaker Street
London EC2Y 9SS
Clayton Utz
Level 15, 1 Bligh Street, Sydney,
NSW 2000, Australia
DFDL Mekong (Thailand) LLP
No 3 Rajanakarn Building,
South Sathorn Road,
Yannawa Sub-District,
Sathorn District,
Bangkok Metropolis 10120,
Thailand
AUDITOR
Crowe U.K. LLP
55 Ludgate Hill,
London EC4M 7JW
NOMINATED ADVISER :
Strand Hanson Limited
26 Mount Row,
London W1K 3SQ
BROKERS
Zeus Capital Ltd
82 King Street
Manchester M2 4WQ
Metal Tiger plc
76
Annual Report & Accounts 2022
Chan and Nick Geoje
Island May
Metal Tiger plc
Weston Farm House
Weston Down Lane
Weston Colley
Winchester
Hants SO21 3AG
United Kingdom
Tel:
+44(0)20 3287 5349
Email: info@metaltigerplc.com
www.metaltigerplc.com
Company No : 04196004