PEMBRIDGE RESOURCES PLC
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
Pembridge Resources plc
Company No. 07352056
Contents
Strategic Report
Chairman’s statement ......................................................................................................................... 2
Principal Risks and Uncertainties and Key Performance Indicators .................................................... 2
Corporate and Social Responsibility Report ................................................................................................ 4
Board of Directors and Senior Management……………………………… ………………………………………5
Directors’ Report ............................................................................................................................................. 7
Governance Report ......................................................................................................................................... 9
Directors’ Remuneration Report .................................................................................................................. 13
Directors’ Responsibilities ........................................................................................................................... 17
Independent Auditor’s Report to the members of Pembridge Resources Plc ......................................... 18
Financial Statements
Consolidated Statement of comprehensive income .......................................................................... 21
Company Statement of comprehensive income ................................................................................ 22
Consolidated Statement of financial position .................................................................................... 23
Company Statement of financial position .......................................................................................... 24
Consolidated Statement of changes in equity ................................................................................... 25
Company Statement of changes in equity ......................................................................................... 26
Consolidated Cash flow statement .................................................................................................... 27
Company Cash flow statement ......................................................................................................... 28
Notes to the Financial Statements .................................................................................................... 29
Company Information
Company information ........................................................................................................................ 42
1
Strategic Report
Chairman’s statement
We are pleased to present the Annual Report and Financial Statements of Pembridge Resources plc’s (“Pembridge”,
the “Group” or the “Company”) results for the year ended 31 December 2018.
Introduction
Given the macro outlook for mining and mining investment during 2018, the Directors believed an opportunity existed
for the Company to take advantage of cyclically low asset and project valuations, particularly in base and precious
metals, and to invest in projects where access to capital has been restricted.
In February 2018 the Company signed a Sale and Purchase Agreement (“SPA”) with Capstone Mining Corporation
(“Capstone”) to acquire Minto Explorations Ltd (“Minto”), which operates a copper-gold-silver mine (the “Minto Mine”).
The Minto Mine is located in the mining friendly Yukon territory in Canada and has a 10-year production history with all
key infrastructure and facilities in place. The opportunity offered by the Minto Mine aligned with the Company’s stated
goal to acquire a producing and profitable mining operation, to which the Pembridge team can add value.
The Company sought to raise equity in June 2018 in order to fund the purchase of the Minto Mine. However, against
a background of falling copper prices and increased market uncertainty, the Company was unable to raise the equity
required despite the backing of a major global Japanese trading house and a clear plan to extend the life of the Minto
Mine.
Subsequently, Capstone took the decision to cease production at the Minto Mine and placed it onto care-and-
maintenance, effective 11 October 2018. During the fourth quarter of 2018, the Company engaged in discussions with
Capstone to renegotiate the terms of the SPA.
The Company expects to be in a position to provide an update to shareholders on the status of those discussions
shortly.
During the year the Company acquired three newly incorporated Canadian registered subsidiary undertakings in order
to acquire certain mining rights in the Yukon. As a result, the year ended 31 December 2018 is the first period in which
consolidated financial statements are prepared.
Financials
During 2018, the Group and Company made a loss of US$3.79 million (2017 – Company loss of US$1.90 million). The
closing cash and cash equivalents balance is US$0.151 million at year-end 2018, compared to US$2.027 million at
year-end 2017.
Principal risks and uncertainties
Nature of Risk
Funding Risk
The Group and Company will need to secure additional
funding to cover working capital.
How we manage it
The Group and Company have the capability to raise
funds required for working capital purposes via its
brokers, SI Capital and Brandon Hill.
Impact
Shortage of cash for Head Office and acquisition costs.
Regulatory Risk
The Company may not be able to complete a reverse
takeover and become eligible for re-admission to listing
on the standard segment of the Official List of the UK
Financial Conduct Authority and to trading on the main
market for listed securities of London Stock Exchange
plc.
Impact
The Company will cease to be admitted to listing on the
standard segment of the Official List of the UK Financial
Conduct Authority and to trading on the main market for
listed securities of London Stock Exchange plc.
2
Pembridge is currently undertaking a process to seek re-
admission to listing on the standard segment of the
Official List of the UK Financial Conduct Authority and to
trading on the main market for listed securities of London
Stock Exchange plc, and to raise funds for working
capital and costs associated with an acquisition.
This process is being facilitated by the assembled team
outlined in the Chairman’s statement who have engaged
with the necessary advisers, including the Company’s
brokers, to raise capital within the required timeframe.
Nature of Risk
Human Resources Risk
The achievement of
the Group’s and Company’s
objectives will be dependent on the Company attracting
and retaining qualified and motivated staff.
How we manage it
The Company has attracted and will retain a qualified
team by providing a competitive remuneration policy,
which includes financial performance incentives so as to
align the team with the shareholders of the Company.
Impact
The efficiency of a particular aspect of the Group’s and
Company’s operations could be affected leading to
reduced profitability.
Investment Risk
The investments the Company makes fail to be of any
value.
Impact
The investments are written off.
Business Review & Development
Pembridge has a comprehensive investment policy and
strategy, as outlined in its Financial Position and
Prospects (“FPP”) procedures, that will assist in prudent
measures being made to identify and perform due
diligence on the investments that the Company makes.
A review of the business and its operations can be found in the Chairman’s statement on page 2.
Key performance indicators
KPI
Shareholder returns
Measure
Share price performance
Cash flows
Cash balances
Performance
The Company’s ordinary share price
was suspended at 1.275p on
announcement of the Minto
purchase transaction and remained
suspended as at 31 December
2018.
Cash balances decreased from
US$2.027million to US$
0.151million.
Francis McAllister
Non-Executive Director and Chairman of the Board
30 April 2019
3
Corporate and Social Responsibility Report (“CSR”)
Pembridge is committed to complying with all Health and Safety, environmental and social legislation and protecting the
health and general wellbeing of its employees. It is committed to preserving the environment.
Environment
Concern for the environment is of upmost importance to Pembridge. It is our policy to reduce to a minimum the potential
environmental impact of our activities and have a positive impact on the areas in which we operate.
Health, Safety and Security
The health, safety and security of the personnel and communities in which we operate takes priority in the management
of our operations. Our goal is to prevent injury and ill health to employees and contractors by providing a safe and
healthy working environment and by minimising risks associated with occupational hazards.
Business Ethics
Pembridge is committed to carrying out all its operations with high moral and legal standards. Pembridge has an anti-
corruption and anti-bribery policy which are in line with the requirements of the UK Bribery Act. Staff and contractors
are made aware of their obligations both on recruitment and by periodical updates.
The Strategic Report (comprising the Chairman’s statement and principal risks and uncertainties) on pages 2-3 was
approved by the Board of Directors and was signed on its behalf by Francis McAllister, Chairman of the Board.
Francis McAllister
Non-Executive Director and Chairman of the Board
30 April 2019
4
Board of Directors and Senior Management
Frank McAllister, Chairman
With over 50 years' industry experience, Frank McAllister has held various senior and Board positions in a number of
metals and mining companies. He worked with ASARCO Incorporated for 33 years during which he became Chief
Financial Officer in 1982 and then Executive Vice President of Copper Operations in 1993. He eventually became
ASARCO's President and Chief Operating Officer before becoming Chairman and Chief Executive Officer in 1999. In
1996 he became an Independent Director of Cliffs Natural Resources Inc and its Lead Director from 2004 to 2013.
During the same period, he was also Chairman, CEO and a Director at Stillwater Mining Co, and served as President
of the National Mining Association during 2012 and 2013. Frank holds an MBA from New York University, Bachelor of
Science in Finance from the University of Utah and attended the Advanced Management Program at Harvard Business
School.
David Linsley, Chief Executive Officer
David Charles Linsley is a former Executive Director of Behre Dolbear. Prior to his work with BD he was a co-founder
of Northern Zinc, a group formed to acquire a near production zinc asset in upstate New York. Mr Linsley founded Sirius
Investment Management LLP in 2005, a Gibraltar based multi strategy fund management group specialising in fund of
funds and hedge fund products. The most notable fund launched was the Sirius Resource Fund which invested in global
mining and resource transactions. Previously, in 1998, Mr Linsley was a co-founder and CEO of Cross Asset
Management Ltd, a UK- based hedge fund management Company which managed $500 million in assets across
multiple strategies including Event Driven Equity and Credit. As a multi-strategy Europe-focused arbitrage firm, Cross
Asset Management was involved in mergers, corporate restructurings, IPOs and private placements across Europe. In
2005, Cross Asset Management was sold to RAB Capital, a specialist asset manager focusing on natural resource and
long/short equity investments. Mr Linsley started his career at Lehman Brothers International in the prime brokerage
and equity finance group, where he was involved with numerous hedge fund structures as an early participant in the
London based hedge fund community. Mr Linsley has developed strong relationships with institutional funds
internationally, including in Europe and the US. In addition, Mr Linsley has been involved in numerous financings in the
mining and natural resource sectors around the world and has sat on the board of several mining companies.
Guy Le Bel, Non-Executive Director
Guy brings more than 30 years of international experience in strategic and financial mine planning to the Pembridge
team. He is currently CFO of Golden Queen Mining Ltd, and was previously Vice President Evaluations for Capstone
Mining Corp, Director of Golden Queen Mining, RedQuest Capital Corp and was VP, Business Development at Quadra
Mining Ltd. He also held business advisory, strategy and planning, business valuation, and financial planning
management roles at BHP Billiton Base Metals Ltd., Rio Algom Ltd. and Cambior Inc. He has extensive experience
across precious and base metals industries in the Americas. Guy holds an MBA Finance from École des Hautes Études
Commerciales, a Master Applied Sciences, Mining Engineering - University of British Columbia and a B.Sc. Mining
Engineering from Université Laval.
Gati Al-Jebouri, Non-Executive Director
Mr Al-Jebouri, who was born in Bulgaria in 1969, graduated from the University of Bristol with a Civil Engineering degree
in 1990 and from the Institute of Chartered Accountants as a chartered accountant in 1994. In 2001 he was appointed
Deputy Minister of Energy of Bulgaria and in 2002 Bulgaria's First Deputy Minister of Finance. His varied career has
included working for the accountancy firm KPMG in London and Bulgaria until being recruited to LUKOIL, where he
soon became Director of Investment and Finance in the London office. In 2003 he became Chief Financial Officer of
LITASCO (LUKOIL International Trading and Supply Company), where he rose to Chief Executive Officer two years
later. In 2010 he became Executive Director for Finance and Marketing of LUKOIL Mid East Ltd and in 2018 was
promoted to Managing Director of the Company.
Peter Bojtos, President
Peter Bojtos is a professional engineer with over 40 years of experience in the mining industry and a strong background
in corporate management; including all facets of the industry from exploration through the feasibility study stage to mine
construction, operations and decommissioning. He graduated from the University of Leicester in 1972, following which
he worked at a number of open-pit iron-ore and underground base-metal and uranium mines in West Africa, the United
States and Canada. From 1990 to 1995 he was President & CEO of RFC Resource Finance Corp, President & CEO of
Consolidated Nevada Goldfields Corp and was Chairman & CEO of Greenstone Resources Ltd. He has also been an
independent Director of numerous Canadian, US, Australian, London or European listed mining and exploration
companies over the past 18 years. These include Birim Goldfields Inc., Desert Sun Mining Corp., Queenstake
Resources Ltd., European Uranium Inc., US Gold Corp.and Vaaldiam Resources Ltd.
5
During the course of his career he has visited and evaluated properties in over 70 countries carrying out approximately
20 significant corporate acquisitions, mergers or sales that involved 24 operating mines; participating in the financing,
development, building or reopening of 19 mines and has had a hand in the operation of 24 producing mines.
Paul Fenby, Chief Financial Officer
Paul has over 25 years' experience in natural resources, most recently as Group CFO of UK listed Asia Resource
Minerals Plc between 2013 and 2015. There he was responsible for both the London and Jakarta listed entities of the
Indonesia focussed coal mining Company. Immediately prior to joining Pembridge he was the Interim CFO at Smiths
Detection, a division of Smiths Group Plc. After qualifying in 1990 as an accountant in public practice he joined
ExxonMobil where he held roles in finance, strategic planning, sales & marketing and external affairs. He then held
senior international finance roles at BG Plc and Petrofac Plc, and has lived and worked in Egypt, Kazakhstan, Malaysia
and Indonesia. Paul holds a degree from the University of Leicester, and is a Fellow of the Institute of Chartered
Accountants in England and Wales.
Thomas Horton, Vice President Project Development
Thomas Horton is a mining professional with a range of work experience across Canada, the Middle East, Europe and
the UK. He joins Pembridge from Private Equity firm Duke Street Capital, where he was involved in deal execution and
origination, following the completion of his MBA. Prior to this, Thomas was business development manager for
MineARC Systems, where he successfully expanded the business across Europe and the Middle East. Before
MineARC, Thomas was at RFC Ambrian where he worked with a number of London and ASX listed mining and oil &
gas clients in a corporate broking and capital markets capacity. Prior to RFC Ambrian, Thomas was a project engineer
in the Canadian mining industry working for AMEC and Fluor Corp, where he worked on Vale’s Long Harbour nickel
processing plant construction, Freeport McMoran’s El Abra SX EW plant expansion, and the feasibility studies for BHP’s
Jansen project and Agrium’s Vanscoy expansion project. Thomas holds a Masters in Business Administration (MBA)
from London Business School, and has a Master’s degree (MEng) in Mechanical Engineering from the University of
Manchester. Thomas is also Co-Chairman and Secretary for the Association of Mining Analysts.
6
Directors’ Report
The Directors present their report and the audited Financial Statements of the Group and Company for the year ended
31 December 2018.
General information about the Group and Company is provided in note 1 to the Financial Statements.
Principal activity
The principal activity of Pembridge is to operate as a base and precious metals focussed holding company.
Business review and future development
A review of the business and future developments of the Group and Company is included within the Chairman’s
statement on pages 2 and 3, which form part of the Strategic Report.
Results and dividends
During 2018, the Group made a loss of US$3.83 million (2017 – Company loss of US$1.90 million). The loss incurred
during the year consists of costs of running the head office in London, associated listing and regulatory requirements
and legal and professional costs in connection with the Minto acquisition. No dividends were paid during the year and
the Directors do not recommend payment of a final dividend (2017: $nil).
Going concern
The Group’s and Company’s ability to continue to adopt the going concern basis of preparation will depend upon a
number of matters including future successful capital raisings for necessary funding or loans from third parties.
The Group and Company does not currently have sufficient funds to meet its working capital needs over the going
concern period, and further funding will be required in order to complete an acquisition and for associated working
capital requirements. The Company will seek to raise funds for working capital purposes through a fundraise, and will
seek re-admission to listing on the standard segment of the Official List of the UK Financial Conduct Authority and to
trading on the main market for listed securities of London Stock Exchange plc, which is subject to shareholder and
regulatory approvals. The Directors are of the opinion that the Company will be able to secure funding through
fundraises and from third parties to meet its current and future liabilities. However, in the event that the Group and
Company is unable to secure finance either through third parties or capital raising, it may not have sufficient funds in
order to meet its contracted and committed liabilities for at least 12 months from the date of approval of the Financial
Statements, and will need to source additional funds by alternative means to continue as a going concern.
Related Party Transactions
The Company borrowed £280,000 during the year to 31 December 2018 from its Directors, to fund working capital.
Further details are provided in Note 10 to these financial statements.
Post reporting date events
The Company entered into a related party transaction with Gati Al-Jebouri on 25 February 2019, borrowing £40,000 in
order to fund working capital. The unsecured loan has a two year term, and carries an interest rate of 20% per annum,
payable semi-annually in arrears.
Directors
The Directors who served during the year ended 31 December 2018 and up to the date of signing the Financial
Statements were as follows:
Francis McAllister
David Charles Linsley
Guy Le Bel Non-Executive Director
Non-Executive Director
Gati Al-Jebouri
Chairman and Non-Executive Director
Director and Chief Executive Officer
7
Share consolidation and deferred share repurchase
On 16 July 2018 the Company announced the consolidation of every 10 existing ordinary shares of nominal value 0.1
pence each into one Ordinary Share of nominal value; such consolidation to take place immediately before the ordinary
shares are re-admitted to listing on the standard segment of the Official List of the UK Financial Conduct Authority and to
trading on the main market for listed securities of London Stock Exchange plc. Also on 16 July 2018, all of the Deferred
Shares were repurchased by the Company by way of the proceeds of the issue of one ordinary share.
Capital structure
The Company’s capital consists of ordinary shares which rank pari passu in all respects which are currently suspended
from listing on the standard segment of the Official List of the UK Financial Conduct Authority and trading on the main
market for listed securities of London Stock Exchange plc. There are no restrictions on the transfer of securities in the
Company or restrictions on voting rights and none of the Company’s ordinary shares are owned or controlled by employee
share schemes. There are no arrangements in place between shareholders that are known to the Company that may
restrict voting rights, restrict the transfer of securities, result in the appointment or replacement of Directors, amend the
Company’s articles of association or restrict the powers of the Company’s Directors, including in relation to the issuing or
buying back by the Company of its shares or any significant agreements to which the Company is a party that take effect
after or terminate upon, a change of control of the Company following a takeover bid or arrangements between the
Company and its Directors or employees providing for compensation for loss of office or employment (whether through
resignation, purported redundancy or otherwise) that may occur because of a takeover bid.
Directors’ indemnities
Pembridge maintained liability insurance for its Directors and officers during the period and also as at the date of the
Directors’ Report.
Financial instruments
The financial risk management policies and objectives are set out in detail in Note 22 of the Financial Statements.
Information on exposure to risks
Principal risks and uncertainties are discussed in the Strategic Report on pages 2 and 3, while liquidity risks are covered
in Note 22.
Greenhouse gas emissions
The Group has as yet minimal greenhouse gas emissions to report from the operations of the Group and does not have
responsibility for any other emission producing sources under the Companies Act 2006 (Strategic Report and Directors
report) Regulations 2014.
Corporate Governance
The Governance Report is disclosed on pages 9 to 12.
Statement as to disclosure of information to auditor
The Directors who were in office on the date of approval of these Financial Statements have confirmed, as far as they are
aware, that there is no relevant audit information of which the auditors are unaware. Each of the Directors have confirmed
that they have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any
relevant audit information and to establish that it has been communicated to the auditor.
Auditor
The auditors, PKF Littlejohn LLP, have expressed their willingness to continue in office and a resolution that they be re-
appointed will be proposed at the annual general meeting.
By order of the Board
David Linsley
Director and Chief Executive Officer
30 April 2019
8
Governance Report
Introduction
Pembridge Resources plc recognises the importance of, and is committed to, high standards of Corporate Governance.
At the date of this Report, and whilst the Company is not formally required to comply with the UK Corporate Governance
Code, the Company will try to observe, where practical, the requirements of the UK Corporate Governance Code. The UK
Corporate Governance Code can be found at frc.org.uk/our-work/publications/Corporate-Governance.
The Group will comply with the QCA Code, as published by the Quoted Companies Alliance, to the extent they consider
appropriate in light of the Group’s size, stage of development and resources.
The Group is currently a small company with a modest resource base. The Group has a clear mandate to optimise the
allocation of limited resources to support its development plans. As such, the Group strives to maintain a balance between
conservation of limited resources and maintaining robust corporate governance practices. As the Group evolves, the Board
is committed to enhancing the Group’s corporate governance policies and practices deemed appropriate for the size and
maturity of the organisation.
Set out below are the Group’s and Company’s corporate governance practices for the year ended 31 December 2018.
Leadership
The Group is headed by an effective Board which is collectively responsible for the long-term success of the Group.
The role of the Board - The Board sets the Group’s strategy, ensuring that the necessary resources are in place to achieve
the agreed strategic priorities, and reviews management and financial performance. It is accountable to shareholders for
the creation and delivery of strong, sustainable financial performance and long-term shareholder value. To achieve this,
the Board directs and monitors the Group’s affairs within a framework of controls which enable risk to be assessed and
managed effectively. The Board also has responsibility for setting the Group’s core values and standards of business
conduct and for ensuring that these, together with the Group’s obligations to its stakeholders, are widely understood
throughout the Group.
Board Meetings - The core activities of the Board are carried out in scheduled meetings of the Board. These meetings are
timed to link to key events in the Group’s corporate calendar and regular reviews of the business are conducted. Additional
meetings and conference calls are arranged to consider matters which require decisions outside the scheduled meetings.
During the year, the Board met on 9 occasions.
Outside the scheduled meetings of the Board, the Directors maintain frequent contact with each other to discuss any issues
of concern they may have relating to the Group or their areas of responsibility, and to keep them fully briefed on the
Company’s operations.
Matters reserved specifically for Board - The Board has a formal schedule of matters reserved that can only be decided by
the Board. The key matters reserved are the consideration and approval of;
The Group’s overall strategy;
Financial Statements and dividend policy;
-
-
- Management structure including succession planning, appointments and remuneration; material acquisitions and
disposal, material contracts, major capital expenditure projects and budgets;
- Capital structure, debt and equity financing and other matters;
- Risk management and internal controls;
-
- Corporate policies.
The Group’s corporate governance and compliance arrangements; and
Summary of the Board’s work in the year – During the year, the Board considered all relevant matters within its remit, but
focused in particular on the establishment of the Group and Company and the identification of a suitable investment
opportunity for the Company to pursue. Certain other matters are delegated to the Board Committees, namely the Audit
and Remuneration Committees.
9
Governance Report (continued)
Attendance at meetings:
Member
Francis McAllister
David Charles
Linsley
Guy Le Bel
Gati Al-Jebouri
Chairman and Non-Executive Director
Director and Chief Executive Officer
Non-Executive Director
Non-Executive Director
Meetings
attended
8
9
9
8
The Board is pleased with the high level of attendance and participation of Directors at Board and committee meetings.
The Chairman, Francis McAllister, sets the Board Agenda and ensures adequate time for discussion.
Non-executive Directors - The non-executive Directors bring a broad range of business and commercial experience to
the Company and have a particular responsibility to challenge independently and constructively the performance of the
Executive management (where appointed) and to monitor the performance of the management team in the delivery of the
agreed objectives and targets.
Non-executive Directors are initially appointed for a term of three years, which may, subject to satisfactory performance
and re-election by shareholders, be extended by mutual agreement.
Other governance matters - All of the Directors are aware that independent professional advice is available to each Director
in order to properly discharge their duties as a Director. In addition, each Director and Board Committee has access to the
advice of the Company Secretary.
The Company Secretary - The Company Secretary role is carried out by London Registrars Ltd.
Effectiveness
For the period under review the Board comprised of a Chief Executive Officer, a non-executive Chairman and two
independent non-executive Directors. Biographical details of the Board members are set out on pages 5 and 6 of this
report.
The Directors are of the view that the Board and its committees consist of Directors with an appropriate balance of skills,
experience, independence and diverse backgrounds to enable them to discharge their duties and responsibilities
effectively.
Independence - The Board considers each of the non-executive Directors to be independent in character and judgement.
Appointments – the Board is responsible for reviewing and the structure, size and composition of the Board and making
recommendations to the Board with regards to any required changes.
10
Governance Report (continued)
Commitments – All Directors have disclosed any significant commitments to the Board and confirmed that they have
sufficient time to discharge their duties.
Induction – All new Directors received an induction as soon as practical on joining the Board.
Conflicts of interest – A Director has a duty to avoid a situation in which he or she has, or can have, a direct or indirect
interest that conflicts, or possibly may conflict with the interests of the Group and Company. The Board had satisfied
itself that there is no compromise to the independence of those Directors who have appointments on the Boards of, or
relationships with, companies outside the Company. The Board requires Directors to declare all appointments and other
situations which could result in a possible conflict of interest.
Board performance and evaluation – The Company has a policy of appraising Board performance annually. Having
reviewed various approaches to Board appraisal, the Company has concluded that for a Company of its current scale,
an internal process of regular face to face meetings is most appropriate, in which all Board members discuss any issues
as and when they arise in relation to the Board or any individual member’s performance.
Although the Board consists of only male Directors, the Board supports diversity in the Boardroom and the Financial
Reporting Council’s aims to encourage such diversity. The following table sets out a breakdown by gender at 31
December 2018:
Directors
Senior Managers
Other employees
Accountability
Male
4
3
-
Female
-
2
The Board is committed to providing shareholders with a clear assessment of the Group’s position and prospects. This
is achieved through this report and as required other periodic financial and trading statements.
Going concern - The Group’s and Company’s business activities, together with factors likely to affect its future operations,
financial position, and liquidity position are set out in the Directors’ Report and the Principle risks and Uncertainties
sections of the Strategic Report. In addition, the notes to Financial Statements discloses the financial risk management
practices with respect to its capital structure, liquidity risk, foreign exchange risk, and other related matters.
The Directors, having made due and careful enquiry, are of the opinion that the Group and Company do not have
adequate working capital to execute its operations and will require further working capital during the next 12 months, and
has the ability to access such additional financing. The Directors, therefore, have made an informed judgement, at the
time of approving Financial Statements, that there is a reasonable expectation that the Group and Company have
adequate resources to continue in operational existence for the foreseeable future. As a result, the Directors have
continued to adopt the going concern basis of accounting in preparing the financial statements.
Internal controls - The Board of Directors reviews the effectiveness of the Group’s and Company’s system of internal
controls in line with the requirement of the Code. The internal control system is designed to manage the risk of failure to
achieve its business objectives. This covers internal financial and operational controls, compliances and risk
management. The Company has necessary procedures in place for the year under review and up to the date of approval
of the Annual Report and Financial Statements. The Directors acknowledge their responsibility for the Group’s and
Company’s system of internal controls and for reviewing its effectiveness. The Board confirms the need for an ongoing
process for identification, evaluation and management of significant risks faced by the Group. The Directors carry out a
risk assessment before signing up to any commitments.
11
Governance Report (continued)
The Audit Committee regularly reviews and reports to the Board on the effectiveness of the system of internal control.
Given the size of the Group and Company and the relative simplicity of the systems, the Board considers that there is no
current requirement for an internal audit function. The procedures that have been established to provide internal financial
control are considered appropriate for a Group and Company of its size and include controls over expenditure, regular
reconciliations and management accounts.
The Directors are responsible for taking such steps as are reasonably available to them to safeguard the assets of the
Group and to prevent and detect fraud and other irregularities.
Remuneration
Currently due to the size of the Group there is no Remuneration Committee. This will be established following an
acquisition. Remuneration paid to Directors in the period under review is disclosed in the Directors’ Remuneration Report.
Nomination
Currently due to the size of the Group there is no Nomination Committee. This will be established following an acquisition.
Shareholder relations
Communication and dialogue – Open and transparent communication with shareholders is given high priority and there is
regular dialogue with institutional investors, as well as general presentations made at the time of the release of the annual
and interim results. All Directors are kept aware of changes in major shareholders in the Company and are available to
meet with shareholders who have specific interests or concerns. The Group issues its results promptly to individual
shareholders and also publishes them on the Company’s website: www.pembridgeresources.com. Regular updates to
record news in relation to the Group are included on the Company’s website. Shareholders and other interested parties
can subscribe to receive these news updates by email by registering online on the website free of charge.
The Directors are available to meet with institutional shareholders to discuss any issues and gain an understanding of the
Company’s business, its strategies and governance. Meetings are also held with the corporate governance representatives
of institutional investors when requested.
Annual General Meeting - At every annual general meeting individual shareholders are given the opportunity to put
questions to the Chairman and to other members of the Board that may be present. Notice of the annual general meeting
is sent to shareholders at least 21 clear days before the annual general meeting. Details of proxy votes for and against
each resolution, together with the votes withheld are announced by way of regulatory information service and are published
on the Company’s website as soon as practical after the annual general meeting.
Francis McAllister
Chairman and Non-Executive Director
30 April 2019
12
Directors’ Remuneration Report
Until an acquisition is made the Company will not have a separate remuneration committee. The Board as a whole will
instead review the scale and structure of the Directors’ fees, taking into account the interests of shareholders and the
performance of the Company and Directors. Following the completion of an acquisition, the Board intends to put in place
a remuneration committee.
The items included in this report are unaudited unless otherwise stated.
Statement of Pembridge Resources plc’s policy on Directors’ remuneration
The Group’s policy is to maintain levels of remuneration so as to attract, motivate, and retain Directors and Senior
Executives of the highest calibre who can contribute their experience to deliver industry leading performance with the
Group’s operations. Currently Director’s remuneration is not subject to specific performance targets.
In future periods the Group intends to implement a remuneration policy so that a meaningful proportion of Executive and
Senior Management’s remuneration is structured so as to link rewards to corporate and individual performance, align their
interests with those of shareholders and to incentivise them to perform at the highest levels. No Director takes part in any
decision directly affecting their own remuneration.
Directors’ remuneration
The Directors who held office at 31 December 2018 and who had beneficial interests in the ordinary shares of the Company
are summarised as follows:
Name of Director
Position
No. of shares held
Francis McAllister
David Linsley
Chairman, Non-Executive Director
Director and Chief Executive Officer
Guy Le Bel
Gati Al-Jebouri
Non-Executive Director
Non-Executive Director
4,687,500
3,750,000
468,750
12,500,000
Each of the Directors entered into service agreements at the time of the Company’s admission to the main market in August
2017. Details of Directors’ emoluments and of payments made for professional services rendered are set out below.
Remuneration components
For the year ended 31 December 2018 salaries and fees, bonuses and share based payments were the sole components
of remuneration. The Board will consider the components of Directors’ remuneration during the year and following this
review these are likely to consist of:
•
•
•
•
•
Salaries and fees
Annual bonus
Taxable benefits
Pensions
Share Incentive arrangements
13
Directors’ emoluments and compensation (audited)
Set out below are the emoluments of the Directors for the year ended 31 December 2018:
2018
Salary
and
Fees
US$'000
Share
based
Bonus payments
US$'000
US$’000
Total
US$'000
Francis McAllister
David Charles Linsley
Gati Al-Jebouri
Guy Le Bel
-
419
-
-
Total
419
-
-
-
-
-
-
-
-
-
-
-
419
-
-
419
2017
Share
based
Bonus payments
US$'000
US$’000
Total
US$'000
Fees
US$'000
Roderick Webster*
Paul Johnson**
John Bryant*
Nicholas O’Reilly**
Francis McAllister
David Charles Linsley
Gati Al-Jebouri
Guy Le Bel
22
-
11
-
-
75
-
-
-
-
-
-
-
160
-
-
-
-
-
-
-
64
-
-
22
-
11
-
-
299
-
-
Total
108
160
64
332
*resigned 27 September 2017
**resigned 17 February 2017
14
Directors beneficial share interests (audited)
The interests of the Directors who served during the year in the share capital of the Company at 31 December
2018 and at the date of this report or their resignation (if earlier) were as follows:
Name of Director
Francis McAllister
David Linsley
Guy Le Bel
Gati Al-Jebouri
Number of
ordinary shares
held at 31
December 2018
4,687,500
3,750,000
468,750
As at the date
of this report
4,687,500
Number of
options /
warrants
6,037,500
3,750,000
10,325,000
468,750
1,818,750
Number of share
options / warrants
vested but
unexercised
4,687,500
3,750,000
468,750
12,500,000
12,500,000
13,850,000
12,500,000
Total pension entitlements (audited)
The Company currently has a statutory workplace pension scheme in place, but does not pay pension amounts in relation
to any of the Directors.
The Company has not paid out any excess retirement benefits to any Directors or past Directors.
Payments to past Directors (audited)
The Company has not paid any compensation to past Directors.
Payments for loss of office (audited)
No payments were made for loss of office during the year.
Consideration of shareholder views
The Board considers shareholder feedback received and guidance from shareholder bodies. This feedback, plus any
additional feedback received from time to time, is considered as part of the Company’s annual policy on remuneration.
Policy for new appointments
Base salary levels will take into account market data for the relevant role, internal relativities, the individual’s experience
and their current base salary. Where an individual is recruited at below market norms, they may be re-aligned over time
(e.g. two to three years), subject to performance in the role. Benefits will generally be in accordance with the approved
policy.
For external and internal appointments, the Board may agree that the Company will meet certain relocation and/or
incidental expenses as appropriate.
Policy on payment for loss of office
Payment for loss of office would be determined by the remuneration committee once appointed, taking into account
contractual obligations.
Other matters
The Company does not currently have any annual or long-term incentive schemes in place for any of the Directors and as
such there are no disclosures in this respect.
15
Unaudited information
Performance graph
The ordinary shares of the Company were suspended on 14 February 2018, following the announcement of the Minto
acquisition. The shares remained suspended at 31 December 2018, and consequently no share performance graph is
shown.
Approved on behalf of the Board
Francis McAllister
Chairman and Non-Executive Director
30 April 2019
16
Directors’ responsibilities
The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable
law and regulations.
Company law requires the Directors to prepare Financial Statements for each financial year. Under that law the Directors
have elected to prepare the Group and Company Financial Statements in accordance with International Financial
Reporting Standards (IFRSs) as adopted by the European Union. 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
Company and of the profit or loss of the Group and Company for that period.
In preparing these Financial Statements, the Directors are required to:
•
select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
•
•
state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material
departures disclosed and explained in the Financial 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
and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and
Company and enable them to ensure that the Financial Statements and the Directors’ Remuneration Report comply with
the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS
Regulation. They are also responsible for safeguarding the assets of the Group and Company and hence for taking
reasonable steps for the prevention and detection of fraud and other irregularities.
They are also responsible to make a statement that they consider that the Annual Report and Financial Statements, taken
as a whole, is fair, balanced, and understandable and provides the information necessary for the shareholders to assess
the Group and Company’s position and performance, business model and strategy.
Website publication
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the
Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of the Financial
Statements may differ from legislation in other jurisdictions.
Directors Responsibility pursuant to DTR4
Each of the Directors whose names and functions are listed on page 4 confirm that, to the best of their knowledge and
belief:
•
•
the Financial Statements prepared in accordance with IFRS as adopted by the European Union, give a true
and fair view of the assets, liabilities, financial position and loss of the Group and Company; and
the Annual Report and Financial Statements, including the Business review, includes a fair review of the
development and performance of the business and the position of the Group and Company, together with a
description of the principal risks and uncertainties that they face.
Approved on behalf of the Board
Francis McAllister
Chairman and Non-Executive Director
30 April 2019
17
Independent Auditor’s Report to the Members of Pembridge Resources p[lc
Disclaimer of Opinion
We were engaged to audit the Financial Statements of Pembridge Resources plc (the ”Parent Company”) and its
subsidiaries (together, the ”Group”) for the year ended 31 December 2018 which comprise the Consolidated and Company
Statements of Comprehensive Income, the Consolidated and Company Statements of Financial Position, the Consolidated
and Company Statements of Changes in Equity, the Consolidated and Company Cash Flow Statements and notes to the
Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and International Financial Reporting Standards (“IFRSs”) as adopted
by the European Union.
We do not express an opinion on the accompanying Financial Statements of the Group and Parent Company. Because of
the significance of the matter described in the Basis for disclaimer of opinion section of our report, we have not been able
to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these Financial Statements.
Basis for disclaimer of opinion
As explained in Note 3 ‘Accounting Policies – going concern’ to the Financial Statements and the ‘Going concern’ section
of the Directors’ Report, the Group and Parent Company does not currently have sufficient funds to meet its working capital
needs for the next 12 months and further funding will be required. The ability to raise additional funds as at the date of
approval of the Financial Statements is dependent on successfully concluding an acquisition, which is contingent on
obtaining the requisite shareholder and regulatory approvals. The Directors have been unable to provide sufficient
appropriate audit evidence to support their opinion that the going concern basis of preparation is appropriate. We were
unable to satisfy ourselves, through the performance of alternative audit procedures, that additional funds would be secured
in the absence of achieving the above. Consequently, we were unable to confirm the adequacy of the disclosures or
conclude on the adequacy of the going concern basis of preparation, for which the possible effects on the Financial
Statements could be both material and pervasive.
Our application of materiality
The materiality applied to the Group and Parent Company Financial Statements was US$90,000, based on thresholds for
net liabilities and the loss before tax. The performance materiality was US$72,000.
An overview of the scope of our audit
As part of designing our audit, we determined materiality and assessed the risk of material misstatement in the Financial
Statements. In particular, we looked at areas involving significant accounting estimates and judgement by the Directors
and considered future events that are inherently uncertain. We also addressed the risk of management override of internal
controls, including among other matters consideration of whether there was evidence of bias that represented a risk of
material misstatement due to fraud.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
Financial Statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the
allocation of resources in the audit; and directing the efforts of the engagement team.
Except for the matter described in the Basis for disclaimer opinion section, we have determined that there are no key
audit matters to communicate in our report.
Other information
The other information comprises the information included in the Annual Report, other than the Financial Statements and
our auditor’s report thereon. The Directors are responsible for the other information. Our opinion on the Group and Parent
Company Financial Statements does not cover the other information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the Financial
Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is
materially inconsistent with the Financial Statements or our knowledge obtained in the audit or otherwise appears to be
materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to
determine whether there is a material misstatement in the Financial Statements or a material misstatement of the other
information. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
18
As described in the Basis for disclaimer of opinion section of our report, we were unable to obtain sufficient appropriate
audit evidence to support the going concern basis of preparation. Information pertaining to going concern is included in the
Strategic Report and Directors’ Report and accordingly we are unable to confirm the adequacy of that disclosure for the
same reason.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the Directors’ remuneration report to be audited has been properly prepared in accordance with
the Companies Act 2006.
Because of the significance of the matter described in the Basis for disclaimer of opinion section of our report, we have
been unable to form an opinion, whether based on the work undertaken in the course of the audit:
•
•
the information given in the Strategic Report and the Directors’ Report for the financial year for which the Financial
Statements are prepared is consistent with the Financial Statements; and
the Strategic Report and the Directors’ Report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
Notwithstanding our disclaimer of an opinion on the Group and Parent Company Financial Statements, in the light of the
knowledge and understanding of the Group and the Parent Company and their environment obtained in the course of the
audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the
Strategic Report or the Directors’ Report.
Arising solely from the limitation on the scope of our work referred to above:
• we have not obtained all the information and explanations that we considered necessary for the purpose of our
audit; and
• we were unable to determine whether adequate accounting records have been kept by the Parent Company.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
•
•
•
returns adequate for our audit have not been received from branches not visited by us; or
the Parent Company Financial Statements and the part of the Directors’ remuneration report to be audited are
not in agreement with the accounting records and returns; or
certain disclosures of Directors’ remuneration specified by law are not made.
Responsibilities of Directors
As explained more fully in the Directors’ responsibilities statement, the Directors are responsible for the preparation of the
Group and Company Financial Statements and for being satisfied that they give a true and fair view, and for such internal
control as the Directors determine is necessary to enable the preparation of the Financial Statements that are free from
material misstatement, whether due to fraud or error.
In preparing the Group and Parent Company Financial Statements, the Directors are responsible for assessing the Group’s
and 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 Company
or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Statements
Our responsibility is to conduct an audit of the Group's and Parent Company's Financial Statements in accordance with
International Standards on Auditing (UK) and to issue an auditor’s report.
However, because of the matter described in the Basis for disclaimer of opinion section of our report, we were not able to
obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these Financial Statements.
We are independent of the Group and Parent Company in accordance with the ethical requirements that are relevant to
our audit of the Financial Statements in the UK, including the FRC's Ethical Standard as applied to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
19
Other matters which we are required to address
We were appointed by the Board of Directors on 10 February 2018 to audit the Financial Statements for the year ended
31 December 2017. Our total uninterrupted period of engagement is two years.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group or the Company and we
remain independent of the Group and Company in conducting our audit.
As part of our audit procedures, we gained an understanding of the legal and regulatory framework applicable to the Group
and Company and considered the risk of acts by the Group or Company which were contrary to applicable laws and
regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting
a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve
deliberate concealment by, for example, forgery or intentional misrepresentations or through collusion. Our tests included
making enquiries of management, as well as inspecting underlying supporting documentation and calculations.
As in all of our audits, we also addressed the risk of management override of internal controls, including evaluating whether
there was evidence of bias by the Directors that represented a risk of material misstatement due to fraud. Procedures
designed and executed to address these risks included the review and testing of journal entries during the period, testing
and evaluating management’s key accounting estimates for reasonableness and consistency, review of transactions
through the bank statements, and undertaking cut-off procedures to verify proper cut-off of expenses.
Our disclaimer of opinion is consistent with the additional report to the Board.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies
Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are
required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone, other than the company and the company's members as a body, for our audit
work, for this report, or for the opinions we have formed.
David Thompson
(Senior statutory auditor)
For and on behalf of PKF Littlejohn LLP
Statutory auditor
30 April 2019
1 Westferry Circus
Canary Wharf
London E14 4HD
20
Consolidated statement of comprehensive income
For the year ended 31 December 2018
Administrative, legal and professional expenses
Operating loss
Finance income
Finance cost
Loss before income tax
Income tax
Note
7
11
Loss for the year attributable to the equity holders of the Company
Other comprehensive income
Total comprehensive income for the year
Earnings per share expressed in US cents
Basic and diluted loss per share attributable to the equity holders of the
Company
12
All amounts relate to continuing activities.
Year
ended
31 December 2018
US$'000
(3,829)
(3,829)
-
-
(3,829)
-
(3,829)
-
(3,829)
Year
ended
31 December 2018
(1.7c)
The notes on pages 29 to 41 form part of these Financial Statements.
21
Company statement of comprehensive income
For the year ended 31 December 2018
Note
15
7
Year
ended
31 December
2018
US$'000
Year
ended
31 December
2017
US$'000
(3,824)
-
(1,768)
(157)
(3,824)
(1,925)
-
-
-
-
Administrative, legal and professional expenses
Loss on disposal of investments
Operating loss
Finance income
Finance cost
Loss before income tax
(3,824)
(1,925)
Income tax
11
-
-
Loss for the year attributable to the equity
holders of the Company
Other comprehensive income
Total comprehensive income for the year
Earnings per share expressed in US cents
(3,824)
(1,925)
-
(3,824)
-
(1,925)
Year
ended
31 December
2018
Year
ended
31 December
2017
Basic and diluted loss per share attributable to
the equity holders of the Company
12
(1.7c)
(1.4c)
All amounts relate to continuing activities.
The notes on pages 29 to 41 form part of these Financial Statements.
22
Consolidated statement of financial position
As at 31 December 2018
Note
31 December
2018
US$'000
Assets
Non-current assets
Property, plant and equipment
Intangible assets
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Liabilities
Non-current liabilities
Borrowings
Current liabilities
Trade and other payables
Borrowings
Total liabilities
Net liabilities
Equity
Share capital
Share premium
Capital redemption reserve
Other reserve
Retained deficit
Equity attributable to shareholders of the Company
13
14
16
17
19
18
19
20
20
20
15
148
163
240
151
391
554
(103)
(1,831)
(279)
(2,213)
(1,659)
295
2,902
1,011
66
(5,933)
(1,659)
The Financial Statements were approved and authorised for issue by the Board on 30 April 2019 and signed on behalf of
the Board by:
David Linsley
Director and Chief Executive Officer
Francis McAllister
Non-Executive Director and Chairman
The notes on pages 29 to 41 form part of these Financial Statements.
23
Company statement of financial position
As at 31 December 2018
Note
31 December
2018
US$'000
31 December
2017
US$'000
Assets
Non-current assets
Property, plant and equipment
Available for sale financial assets
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total assets
Liabilities
Non-current liabilities
Borrowings
Current liabilities
Trade and other payables
Borrowings
Total liabilities
Net liabilities
Equity
Share capital
Share premium
Capital redemption reserve
Other reserve
Retained deficit
13
14
16
17
19
18
19
20
20
20
15
-
15
393
151
544
559
(103)
(1,831)
(279)
(2,213)
2
-
2
354
2,027
2,381
2,383
-
(213)
-
(213)
(1,654)
2,170
295
2,902
1,011
66
(5,928)
1,306
2,902
-
165
(2,203)
Equity attributable to shareholders of the
Company
(1,654)
2,170
The Financial Statements were approved and authorised for issue by the Board on 30 April 2019 and signed on behalf of
the Board by:
David Linsley
Director and Chief Executive Officer
Francis McAllister
Non-Executive Director and Chairman
The notes on pages 29 to 41 form part of these Financial Statements.
24
Consolidated statement of changes in equity
For the year ended 31 December 2018
Share
capital
Share
premium
Capital
redemption
reserve
Other
reserve
Retained
deficit
Total
US$'000
US$'000
US$’000
US$'000
US$'000
US$'000
Balance at 1 January 2017
1,048
138
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
-
-
-
-
-
-
Proceeds from shares issued
182
2,772
Direct cost of shares issued
Value of placing warrants
Value of share options
Share based payments
-
-
-
76
(153)
(6)
-
151
Total transactions with owners recognised
directly in equity
258
2,764
Balance at 31 December 2017
1,306
2,902
Balance at 1 January 2018
1,306
2,902
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
Cancellation of deferred shares
Warrants expired
Total transactions with owners recognised
directly in equity
-
-
-
(1,011)
-
(1,011)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,011
112
(278)
1,020
-
-
(1,925)
(1,925)
-
-
-
(1,925)
(1,925)
-
-
6
47
-
53
-
-
-
-
-
-
2,954
(153)
-
47
227
3,075
165
(2,203)
2,170
165
(2,203)
2,170
-
-
-
-
(3,829)
(3,829)
-
-
(3,829)
(3,829)
-
99
99
-
-
-
-
(99)
1,011
(99)
Balance at 31 December 2018
295
2,902
1,011
66
(5,933)
(1,659)
The following describes the nature and purpose of each reserve within owners’ equity:
Reserve
Share capital
Share premium
Description and purpose
Nominal value of shares issued.
Amount subscribed for share capital in excess of nominal value, less share issue costs.
Capital redemption reserve
Reserve created on cancellation of the deferred shares
Other reserve
Retained deficit
Cumulative fair value of warrants and share options granted.
Cumulative net gains and losses recognised in the statement of comprehensive income.
25
Company statement of changes in equity
For the year ended 31 December 2018
Share
capital
Share
premium
US$'000
US$'000
Capital
redemption
reserve
US$’000
Other
reserve
Retained
deficit
Total
US$'000
US$'000
US$'000
Balance at 1 January 2017
1,048
138
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
-
-
-
-
-
-
Proceeds from shares issued
182
2,772
Direct cost of shares issued
Value of placing warrants
Value of share options
Share based payments
-
-
-
76
(153)
(6)
-
151
Total transactions with owners recognised
directly in equity
258
2,764
Balance at 31 December 2017
1,306
2,902
Balance at 1 January 2018
1,306
2,902
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
Cancellation of deferred shares
Warrants expired
Total transactions with owners recognised
directly in equity
-
-
-
(1,011)
-
(1,011)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,011
112
(278)
1,020
-
-
(1,925)
(1,925)
-
-
-
(1,925)
(1,925)
-
-
6
47
-
53
-
-
-
-
-
-
2,954
(153)
-
47
227
3,075
165
(2,203)
2,170
165
(2,203)
2,170
-
-
-
-
(3,824)
(3,824)
-
-
(3,824)
(3,824)
-
99
99
-
-
-
-
(99)
1,011
(99)
Balance at 31 December 2018
295
2,902
1,011
66
(5,928)
(1,654)
The following describes the nature and purpose of each reserve within owners’ equity:
Reserve
Share capital
Share premium
Description and purpose
Nominal value of shares issued.
Amount subscribed for share capital in excess of nominal value, less share issue costs.
Capital redemption reserve
Reserve created on cancellation of the deferred shares
Other reserve
Retained deficit
Cumulative fair value of warrants and share options granted.
Cumulative net gains and losses recognised in the statement of comprehensive income.
The notes on pages 29 to 41 form part of these Financial Statements.
26
Notes
16
18
Consolidated cash flow statement
For the year ended 31 December 2018
Cash flows from operating activities
Loss for the year
Adjusted for:
Depreciation
Movements in working capital
Increase in trade and other receivables
Increase in trade and other payables
Net cash used in operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from borrowings
Net cash generated from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
17
The notes on pages 29 to 41 form part of these Financial Statements.
Year
Ended
31 December 2018
US$'000
(3,829)
5
(3,824)
(344)
1,928
(2,240)
(18)
(18)
382
382
(1,876)
2,027
151
27
Notes
16
18
Company cash flow statement
For the year ended 31 December 2018
Cash flows from operating activities
Loss for the year
Adjusted for:
Depreciation
Share option charge
Movements in working capital
Increase in trade and other receivables
Increase in trade and other payables
Net cash used in operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchases of available-for-sale financial assets
Proceeds from sale of available-for-sale financial
assets
Net cash (used in)/generated from investing
activities
Cash flows from financing activities
Proceeds from issuance of shares
Direct cost of share issue
Proceeds from borrowings
Net cash generated from financing activities
Year
Ended
31 December
2018
US$'000
Year
ended
31 December
2017
US$'000
(3,824)
(1,925)
5
-
(3,819)
(40)
1,618
(2,241)
(18)
-
-
(18)
-
-
383
383
1
47
(1,720)
(316)
29
(2,007)
-
(199)
269
70
2,954
(153)
-
2,801
864
1,163
2,027
Net increase in cash and cash equivalents
(1,876)
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
17
2,027
151
The notes on pages 29 to 41 form part of these Financial Statements.
28
Notes to the Financial Statements
For the year ended 31 December 2018
1. NATURE OF OPERATIONS AND GENERAL INFORMATION
The principal activity of the Company is to operate as a mining focussed holding company.
Pembridge Resources plc is incorporated and domiciled in England. The address of the Company's registered office is
Suite A, 6 Honduras Street, London EC1Y 0TH. Pembridge Resources plc's shares are admitted to listing on the standard
segment of the Official List of the UK Financial Conduct Authority and to trading on the main market for listed securities of
London Stock Exchange plc.
The Group’s and Company’s Financial Statements are presented in United States dollars (US$), which is also the functional
currency of the Company, and rounded to the nearest thousand.
These Financial Statements were approved for issue by the Board of Directors on 30 April 2019.
2. STANDARDS, AMENDMENTS AND INTERPRETATIONS
2.1 New and amended standards adopted
There were no IFRSs or IFRIC interpretations relevant to the Group or Company that were effective for the first time for
the financial year beginning 1 January 2018 that had a material impact on the Group or Company.
2.2 Standards, amendments and interpretations to existing standards that are not yet effective and have not been
adopted early
At the date of authorisation of these Financial Statements, certain new standards, amendments and interpretations to
existing standards have been published but are not yet effective, and have not been adopted early by the Group or
Company.
Management anticipates that all of the pronouncements will be adopted in the Group’s and Company’s accounting policy
for the first period beginning after the effective date of the pronouncement. The new standards and interpretations are not
expected to have a material impact on the Group’s and Company’s Financial Statements.
•
•
IFRS 16 – Leases (effective 1 January 2019)
IAS 19 – Employee Benefits, amendments regarding plan amendments, curtailments or settlements (effective 1
January 2019)
•
IFRIC 23 – Uncertainty over Income Tax Treatments (1 January 2019)
• Annual Improvements – Annual Improvements to IFRSs 2015 – 2018 Cycle (1 January 2019*)
*Subject to EU endorsement
3. SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
The Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRSs)
and IFRIC interpretations (IFRS IC) as adopted by the European Union, and with the Companies Act 2006 applicable to
companies reporting under IFRS. The Financial Statements have been prepared under the historical cost convention.
The preparation of Financial Statements in conformity with IFRS requires the use of certain critical accounting estimates.
It also requires management to exercise its judgement in the process of applying the accounting policies. The areas
involving a high degree of judgement or complexity, or areas where assumptions and estimates are significant to the
Financial Statements are disclosed in Note 4.
29
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
Going concern
The Group and Company meets its working capital and investment requirements from its cash and cash equivalents. The
Company raises finance for its activities in discrete tranches. The Group and Company did not generate revenues from
operations during 2018. As such, the ability to continue to adopt the going concern assumptions will depend upon a number
of matters including future successful capital raisings for necessary funding or loans from third parties.
The Group and Company does not have sufficient funds to meet its working capital needs for the next 12 months and
further funding will be required either through equity raisings or other financial arrangements to fund working capital and
costs associated with a potential acquisition. The Company will seek to raise funds for working capital purposes through a
fundraise, and will seek to re-list on the London Stock Exchange, which is subject to shareholder and regulatory approvals.
This cannot be guaranteed and there are no legally binding agreements in place at the date of approval of these Financial
Statements relating to the raising of additional funds.
The Group and Company will only be able to meet its contracted and committed expenditure for at least the next 12 months
with a further injection of funds. The Directors have a reasonable expectation that the Group and Company will be able to
raise such funds, and therefore continue in operational existence for the foreseeable future. Thus they continue to adopt
the going concern basis of accounting in preparing these Financial Statements.
Property, plant and equipment
Property, plant and equipment are recorded at cost, net of accumulated depreciation and any provision for impairment.
Depreciation is provided using the straight-line method to write off the cost of the asset less any residual value over its
useful economic life as follows:
Furniture and office equipment
- 3 years
Intangible assets
Mining Rights are shown at historic cost and are tested annually for impairment.
Foreign currency translation
In preparing the Financial Statements, transactions in currencies other than the entity’s functional currency (foreign
currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each reporting date,
monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the
reporting date. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences arising, if any, are recognised in profit or loss.
Taxes
Income tax represents the sum of the tax currently payable or receivable and deferred tax.
Current tax is based on taxable result for the period. Taxable profit or loss differs from reported profit or loss because it
excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are
never taxable or deductible. The Group’s and Company’s liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and
liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable
temporary differences, and deferred tax assets are recognised to the extent that it is probable that taxable profits will be
available against which deductible temporary differences can be utilised.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset
is realised. Deferred tax is charged or credited in profit or loss, except when it relates to items charged or credited directly
to equity, in which case the deferred tax is also dealt with in equity. Tax relating to items recognised in other comprehensive
income is recognised in other comprehensive income.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to taxes levied by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
30
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
Financial instruments, assets and liabilities
The Group and Company uses financial instruments comprising cash and cash equivalents, trade and other receivables,
trade and other payables and borrowings that arise from its operations.
Financial assets
The only financial assets currently held by the Company are classified as loans and receivables and cash and cash
equivalents. These assets are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market. They are initially recognised at fair value plus transaction costs that are directly attributable to their
acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision
for impairment.
Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part
of the counterparty or default or significant delay in payment) that the Company will be unable to collect all of the amounts
due under the terms receivable, the amount of such a provision being the difference between the net carrying amount and
the present value of the future expected cash flows associated with the impaired receivable.
Loans and receivables comprise trade and other receivables and cash and cash equivalents in the statement of financial
position.
Derecognition of financial assets
The Group and Company derecognises a financial asset only when the contractual rights to the cash flows from the asset
expire; or it transfers the asset and substantially all the risk and rewards of ownership of the asset to another entity.
Financial liabilities
Trade payables and other short-term monetary liabilities are all classified as other financial liabilities. At present, the
Company does not have any liabilities classified as fair value through profit or loss.
Trade payables and other short-term monetary liabilities are initially recognised at fair value and subsequently carried at
amortised cost using the effective interest method. All interest and other borrowing costs incurred in connection with the
above are expensed as incurred and reported as part of financing costs in the statement of comprehensive income.
Derecognition of Financial liabilities
The Company derecognises financial liabilities when, and only when, the Company’s obligations are discharged, cancelled
or they expire.
Cash and cash equivalents
Cash and cash equivalents includes cash in hand and deposits held at call with banks. Any interest earned is accrued
monthly and classified as finance income. For the purposes of the statement of cash flows, cash and cash equivalents
consist of cash and cash equivalents as defined above.
Investment in subsidiary
The Company recognises its previous investments in subsidiaries at cost, less any provision for impairment. The cost of
acquisition includes directly attributable professional fees and other expenses incurred in connection with the acquisition.
Borrowings
Borrowings are initially recognised at fair value, and subsequently carried at amortised cost. Borrowing costs are
recognised in profit or loss in the period in which they are incurred.
31
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares are
shown in equity as a deduction from proceeds.
Share based payments
The fair value of services received from employees and third parties in exchange for the grant of share options and warrants
is recognised as an expense, except for those granted in connection with the issue of new ordinary shares which are
shown as a deduction in equity. A corresponding increase is recognised in other reserves in equity. The fair value of the
share options and warrants is calculated using an appropriate valuation model. At each reporting period end the Company
revises its estimate of the number of options that are expected to become exercisable. The proceeds received net of any
attributable transaction costs are credited to share capital (nominal value) and share premium when exercised.
4. GROUP STRUCTURE
The parent entity of the Group is Pembridge Resources plc, incorporated in England, and the details of its
subsidiaries are as follows:
Yukon
536545 Inc.
Yukon
536445 Inc.
Minotaur
Acquisition
Ltd.
Country of
incorporation
Canada
Canada
Canada
Nature of
business
Mineral
prospecting
Mineral
prospecting
Intermediate
holding
company
Ownership Interest
As at 31
December 2018
100%
As at 31
December 2017
-
100%
100%
-
-
Registered office addresses are as follows:
Yukon 536545 Inc. and Yukon 536445 Inc. – c/o MacDonald and Company, Suite 200, 204 Lambert Street, Whitehorse
Y.T, Canada
Minotaur Acquisition Ltd. – c/o Edwards, Kenny and Bray LLP, 1900-1040 West Georgia Street, Vancouver B.C. Canada
5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
In the application of the Group’s and Company’s accounting policies, described in Note 3, the Directors are required to
make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical experience and other
factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision
and future periods if the revision affects both current and future periods.
Critical estimates in applying the Group’s and Company’s accounting policies
There are currently no critical estimates or judgements that the Directors have made in the process of applying the Group’s
and Company’s accounting policies that have a significant effect on the amounts recognised in Financial Statements.
6. OPERATING SEGMENTS
Operating segments are reported in a manner consistent with the internal reporting provided to the Board, who are
responsible for allocating resources and assessing performance of the operating segment.
The Company currently has one operating segment, being a holding Company, therefore all IFRS 8 disclosures are
incorporated within other notes to the Financial Statements.
32
7. EXPENSES BY NATURE
This is stated after charging:
Staff costs
Share options granted to Directors
Share based payments
Auditor's remuneration (note 8)
8. AUDITOR’S REMUNERATION
Remuneration receivable by the Company’s auditors for the audit of the Financial
Statements
Fees payable to the Company’s auditor and its associates
for other services
Total remuneration
9. EMPLOYEES AND KEY MANAGEMENT
Group
Year ended
31 December
2018
US$'000
Company
Year ended
31 December
2017
US$'000
1,187
-
-
76
416
19
9
38
Group
Year ended
31 December
2018
US$'000
Company
Year ended
31 December
2017
US$'000
18
58
76
14
24
38
The total Directors’ emoluments for the year, including share based payments, were US$419,000 (2017 - US$351,000).
Detailed disclosure of Directors’ remuneration is disclosed in the Directors’ remuneration report on page 14.
The average number of employees was 7 (2017 – 2).
Key management personnel as defined under IAS 24 have been identified as only the Board of Directors.
Wages and salaries
Social security costs
Pension contributions
Total employee benefit expenses
33
Group
Year ended
31 December
2018
US$'000
Company
Year ended
31 December
2017
US$'000
1,038
136
12
1,186
366
51
-
416
10. RELATED PARTY TRANSACTIONS
The Company has entered into the following related party transactions with its Directors in
order to fund working capital:
a) On 28 August 2018, the Company borrowed £200,000 from Frank McAllister. The unsecured loan has no fixed
term, but is due to be repaid within 30 days of the Company being re-listed. The loan carries an interest rate of
10% per annum, payable semi-annually in arrears.
b) On 13 December 2018, the Company borrowed £40,000 from Frank McAllister. The unsecured loan has a two
year term, and carries an interest rate of 20% per annum, payable semi-annually in arrears.
c) on 20 December 2018, the Company borrowed £40,000 from Guy Le Bel. The unsecured loan has a two year
term, and carries an interest rate of 20% per annum, payable semi-annually in arrears.
11. INCOME TAX
Current tax:
UK corporation tax on the result for the year
Total current taxation
Deferred taxation
Income tax
Differences explained below:
Loss before tax
Loss before tax multiplied by the standard rate 19% (2017: 19.25%)
Effect of:
Expenses not deductible for tax
Tax losses for which no deferred income tax asset was
recognised
Tax for the year
Unrecognised deferred tax asset
Tax losses UK – excess management expenses
Group
Year ended
31 December
2018
US$'000
Company
Year ended
31 December
2017
US$'000
-
-
-
-
(3,829)
(727)
-
727
-
1,134
1,134
-
-
-
-
(1,925)
(371)
102
269
-
412
412
The deferred tax assets are currently unrecognised as the likelihood of sufficient future taxable profits does not yet meet
the definition of “probable”.
The unrecognised deferred tax asset has no expiry period.
34
12. EARNINGS PER SHARE
The calculation of basic and diluted loss per ordinary share is based on the following data:
Group
Year ended
31 December
2018
Company
Year ended
31 December
2017
Basic and diluted loss per share (US cents)
(1.7c)
(1.4c)
Weighted average number of shares for basic and
diluted loss per share
223,849,257
133,409,358
The basic and diluted loss per share have been calculated using the loss attributable to shareholders of the Group
(2017:Company) of US$3,829,000 (2017: US$1,925,000) as the numerator, i.e. no adjustment to loss was necessary. The
basic and dilutive loss per share are the same as the effect of the exercise of share options and warrants would be anti-
dilutive.
Details of share options and warrants that could potentially dilute earnings per share in future periods are set out in Note
19.
13. PROPERTY PLANT AND EQUIPMENT
Group
Furniture and
office equipment
US$'000
Company
Furniture and office
equipment
US$'000
Cost
At 1 January 2017 and 2018
Additions
At 31 December 2018
At 1 January 2017
Change for the year
Depreciation
At 1 January 2018
Charge for the year
At 31 December 2018
Net book value at 31 December 2018
Net book value at 31 December 2017
35
3
18
21
-
(1)
(1)
(5)
(6)
15
2
3
18
21
-
(1)
(1)
(5)
(6)
15
2
14. INTANGIBLE ASSETS
Cost
At 1 January 2018
Additions
At 31 December 2018
Accumulated amortisation and impairment
At 1 January 2018 and 31 December 2018
Net book value
At 31 December 2018
15. AVAILABLE-FOR-SALE FINANCIAL ASSETS
At 1 January
Additions
Disposals
At 31 December
16. TRADE AND OTHER RECEIVABLES
Other receivables
Prepayments
VAT recoverable
17. CASH AND CASH EQUIVALENTS
Group
Mining claims
US$'000
-
148
148
-
148
Group and
Company
31 December
2018
US$'000
Company
31 December
2017
US$'000
-
-
-
-
-
426
(426)
-
Group
31 December
2018
Company
31 December
2018
Company
31 December
2017
US$'000
207
7
26
240
360
7
26
393
118
41
195
354
Group
31 December
2018
Company
31 December
2018
Company
31 December
2017
US$'000
US$'000
US$'000
Cash and short-term deposits
151
151
2,027
36
18. TRADE AND OTHER PAYABLES
Trade payables
Other payables and accruals
Group
31 December
2018
US$'000
Company
31 December
2018
US$'000
Company
31 December
2017
US$'000
900
931
1,831
900
931
1,831
97
116
213
Trade and other payables are non-interest bearing and normally settled in the month following date of invoice.
19. BORROWINGS
Non-current
Loans from related parties (note 10)
Current
Loans from related parties (note 10)
Other loans
Group
31 December
2018
US$'000
Company
31 December
2018
US$'000
Company
31 December
2017
US$'000
103
253
279
103
253
279
-
-
-
All borrowings are determined in pounds sterling. All borrowings are unsecured with no exposure to interest rate
changes.
37
20. SHARE CAPITAL AND PREMIUM
Allotted, called up and fully paid
Number of
ordinary
shares
Number of
deferred
shares
Share
Capital –
ordinary
shares
US$000
Share
Capital –
deferred
shares
US$000
Share
premium
US$000
At 1 January 2018
Repurchase of deferred shares
223,849,257
1
81,843,195
(81,843,195)
295
-
1,011
(1,011)
2,902
-
Total
US$000
4,208
-
At 31 December 2018
223,849,258
-
295
-
2,902
4,208
Ordinary shares have attached to them full voting, dividend and capital distribution rights (including on a winding up).
On 16 July 2018 the Company announced the consolidation of every 10 existing ordinary shares of nominal value 0.1
pence each into one ordinary share of nominal value, such consolidation to take place immediately before the shares
are re-admitted to listing on the standard segment of the Official List of the UK Financial Conduct Authority and to trading
on the main market for listed securities of London Stock Exchange plc. Also on 16 July 2018, all of the deferred shares
were repurchased by the Company by way of the proceeds of the issue of one ordinary share, creating a capital
redemption reserve for the same nominal value.
21. SHARE BASED PAYMENTS
Movements in the number of share options and warrants and their related weighted average exercise prices are as follows:
At 1 January,
Correction to balance brought
forward
Granted
Forfeited
2018
2017
Options and
warrants
Number
220,139,010
4,054,781
-
(47,082,949)
Average
exercise
price
(pence)
3.52
3.20
-
4.34
Options and
warrants
Number
53,082,948
-
167,056,062
-
Average
exercise
price
(pence)
4.34
-
3.26
-
At 31 December 2018
177,110,843
3.29
220,139,010
3.52
Out of the 177,110,843 (2017: 224,193,791 as adjusted) outstanding options and warrants, 162,410,843 (2017:
202,143,790) were exercisable at the year-end. 47,082,949 warrants were forfeited during the year as they had expired.
No options or warrant were exercised during the year.
Share options and warrants outstanding at the end of year have the following expiry date and exercise prices:
Grant-Vest
2016
2016
2017
2017
2017-2018
2017-2019
2017-2020
Expiry
date
2018
2021
2019
2022
2027
2027
2027
Exercise price
(pence)
4.34
4.34
3.20
4.34
2.00
4.00
8.00
38
2018
Number
-
6,000,000
146,060,083
3,000,000
7,350,000
7,350,000
7,350,000
2017
Number
47,082,949
6,000,000
146,060,083
3,000,000
7,350,000
7,350,000
7,350,000
22. FINANCIAL INSTRUMENTS
Significant accounting policies
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument, are disclosed in note 3.
The only financial assets currently held by the Company are classified as loans and receivables and cash and cash
equivalents.
Categories of financial instruments
The carrying amounts presented in the statement of financial position relate to the following categories of assets and
liabilities.
Financial assets
Current
Loans and receivables
Trade and other receivables
Cash and cash equivalents
Financial liabilities
Amortised cost
Trade and other payables
Borrowings
Group
31 December
2018
US$'000
Company
31 December
2018
US$'000
Company
31 December
2017
US$'000
233
151
384
386
151
537
(1,831)
(382)
(1,831)
(382)
(2,213)
(2,213)
313
2,027
2,340
(213)
-
(213)
As at 31 December 2018, trade and other receivables are all considered to be recoverable.
The fair value is equivalent to book value for current assets and liabilities.
The main risks arising from the Group’s and Company’s financial instruments are liquidity risk, interest rate risk and foreign
currency risk. The Directors review and agree policies for managing these risks and these are summarised below.
Liquidity risk
Liquidity risk arises from the Group’s management of working capital. It is the risk that the Group will encounter difficulty in
meeting its financial obligations as they fall due. The Directors are current assessing the Group’s options in respect of
raising additional finance for the business.
The Directors monitor cash flow on a daily basis and at quarterly Board meetings in the context of their expectations for
the business, in order to ensure sufficient liquidity is available to meet foreseeable needs.
Interest rate risk
The interest rate profile of the Group’s and Company’s cash and cash equivalents as at 31 December was as follows:
As at 31 December 2018
Cash at bank with no interest rate
Pound
Sterling
$'000
151
151
Total
$'000
151
151
US
Dollars
$'000
-
-
39
As at 31 December 2017
Cash at bank with no interest rate
Dollars
$'000
38
38
Sterling
$'000
1,919
Total
$'000
2,027
1,919
2,027
The Company’s cash at bank is held with an institution with an A+ credit rating (Fitch).
Foreign currency risk management
The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the
reporting date are as follows:
Cash and cash equivalents
Pound Sterling
Group
31 December 2018
US$'000
Company
31 December 2018
US$'000
Company
31 December 2017
US$'000
151
151
151
151
1,989
1,989
The following table details the Company’s sensitivity to a 10% increase and decrease in the US dollar against the relevant
foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally and represents
Management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes
only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for a 10%
change in foreign currency rates. A positive number below indicates an increase in profit and equity where the US dollar
strengthens 10% against the relevant currency. For a 10% weakening of the US dollar against the relevant currency, there
would be an equal and opposite impact on the profit and equity, and the balances below would be negative.
British pound
currency impact
British pound
currency impact
31 December 2018
US$'000
31 December 2017
US$'000
Effect on loss
+10%
-10%
Effect on equity
+10%
-10%
199
199
199
199
15
15
15
15
40
23. CAPITAL MANAGEMENT POLICIES AND PROCEDURES
The Group and Company considers its capital to comprise its ordinary share capital, share premium and accumulated
retained losses as well as loans and reserves (consisting of share based payments reserve).
The Group’s and Company’s objective when maintaining capital is to safeguard the entity's ability to continue as a going
concern, so that it can provide returns for shareholders and benefits for other stakeholders.
The Group and Company meets its capital needs by equity financing and loans from related parties.
Capital for the reporting period under review is summarised as follows:
31 December 2018
US$'000
31 December 2017
US$'000
Total equity
(1,659)
2,170
24. EVENTS SUBSEQUENT TO THE REPORTING DATE
The Company entered into a related party transaction with Gati Al-Jebouri on 25 February 2019, borrowing £40,000 in
order to fund working capital. The unsecured loan has a two year term, and carries an interest rate of 20% per annum,
payable semi-annually in arrears.
41
Company information
Directors
(Non-Executive Director and Chairman)
Francis Ralph McAllister
(Director and Chief Executive Officer)
David Charles Linsley
Guy Le Bel
(Non-Executive Director)
Gati Al-Jebouri (Non-Executive Director)
Secretary
London Registrars Ltd
Registered office
Suite A, 6 Honduras Street
London EC1Y 0TH
Registered number
07352056 (England and Wales)
Auditor
Bankers
Solicitors
Joint Brokers
Registrars
PKF Littlejohn LLP
Statutory Auditor
1 Westferry Circus
Canary Wharf
London E14 4HD
Bank of Scotland
St James’s Gate
14-16 Cockspur Street
London SW1Y 5BL
Cooley (UK) LLP
Dashwood
69 Old Broad Street
London EC2M 1QS
SI Capital Limited
46 Bridge Street
Godalming, Surrey GU7 1HL
Brandon Hill Capital Ltd
1 Tudor Street
London
EC4Y 0AH
Link Asset Management
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Website
www.pembridgeresources.com
TDIM
PERE
42