Saratoga Investment Corp 7.50% Annual Report 2014

FY2014 Annual Report · Saratoga Investment Corp 7.50%
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SAVANNAH RESOURCES PLC
Company No 07307107

ANNUAL REPORT AND FINANCIAL STATEMENTS 

FOR THE YEAR ENDED 31 DECEMBER 2014

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CONTENTS

BUSINESS REVIEW

Chairman’s Statement

Chief Executive’s Report

Strategic Report

GOVERNANCE

Report of the Directors

Corporate Governance Statement

Statement of Directors’ Responsibilities

Report of the Independent Auditors 

FINANCIAL STATEMENTS

Consolidated Statement of Comprehensive Income 

Consolidated Statement of Financial Position 

Company Statement of Financial Position 

Consolidated Statement of Changes in Equity 

Company Statement of Changes in Equity 

Consolidated Statement of Cash Flows 

Company Statement of Cash Flows

Notes to the Consolidated Financial Statements

NOTICE OF THE ANNUAL GENERAL MEETING

COMPANY INFORMATION

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SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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CHAIRMAN’S STATEMENT

I am pleased to report that this has been another year
of growth and development for Savannah, which has
been  deﬁned  by  a  number  of  key  milestone
developments,  resulting 
in  the  transformational
restructure of our portfolio. In addition to advancing our
180km²  Jangamo  heavy  mineral  sands  project  in
Mozambique (‘Jangamo’), we are now also focussed on
the evaluation of three highly prospective copper blocks,
located  in  mineral  rich  Oman,  which  we  acquired  in
2014. Additionally, during the period, and as part of this
restructure, we divested interests in our legacy Mali gold
projects to AIM quoted Alecto Minerals Plc.

Blocks 4, 5 and 6 Copper Projects, Oman 
We  remain  focussed  on 
implementing  an  active
exploration programme at our copper blocks in Oman,
where we have a current Indicated and Inferred Mineral
Resource  of  1.7Mt  at  2.2%  copper  at  the  Mahab  4
prospect in Block 5. With a number of highly prospective
targets now identiﬁed through targeted reconnaissance
and sampling work, these assets continue to prove their
investment  value.  Additionally,  Oman  continues  to
present  itself  as  a  compelling  copper  investment
opportunity,  oﬀering  a  relatively  low  operating  cost
setting and enjoying the beneﬁts of an extensive array
of road, power, smelting and port infrastrucure. With
this  in  mind,  and  followign  the  completion  of  the
acquisition of Gentor Resources Limited, we took the
strategic  decision  during  the  year  to  increase  our
tenement  holdings  in  Oman.  In  November  2014  we
secured an interest in Block 4, which builds upon our
current Block 5 and Block 6 holdings, and increases our
in-country tenement package to over 1,270 km². With a
strengthened 
in-country  position  and  key  target
prospects  identiﬁed  via  geophysics,  we  commenced
drilling in late January 2015.

Jangamo Heavy Mineral Sands, Mozambique
Our  most  recent  achievement  during  this  period  has
been  the  delineation  of  a  maiden  Inferred  Mineral
Resource Estimate of 65Mt at 4.2% Total Heavy Minerals
(‘THM’)  at  our 
Jangamo  Project.  This  notable
development, which we announced in December 2014,
not  only  validates  our  exploration  concept  but  also
marks a signiﬁcant step in unlocking the value potential
of our project. Importantly, this resource was deﬁned
from a modest initial round of resource drilling over a
small  area  of  the  eastern  part  of  the  large  Jangamo

tenement and the mineralisation remains open along
strike.  Consequently  I  am  conﬁdent  that  signiﬁcant
upside opportunity remains to increase this resource,
which we intend to target through future exploration
scheduled to commence after the end of the wet season
late in the ﬁrst half of 2015.

Portfolio Investment in Alecto
During the year we increased our shareholding in AIM
listed Alecto Minerals Plc (“Alecto”) by 42.8% via the
conversion  of  a  loan  note  and  the  divestment  of  the
Company’s legacy Mali projects (Karan and Diatissan) to
Alecto in March 2014 for £250,000 worth of shares in
Alecto. At the end of 2014 we had a 19.6% shareholding
in Alecto and as of 23 February 2015 the shareholding
had reduced to 14.5%. 

Annual General Meeting
At the forthcoming AGM Shareholders will be asked to
renew  the  usual  equity  securities  issue  authorities,
which  includes  a  resolution  in  respect  of  a  Share
Exchange Agreement to acquire an 80% shareholding in
Matilda  Minerals  Lda.  This  requires  the  Company  to
issue up to AUD $1,500,000 worth of shares as deferred
consideration should a JORC Indicated Resource of up to
500Mt  @  3%  THM  at  the  Jangamo  project  be
established.

Financials
As  is  to  be  expected  with  an  exploration  company,
Savannah  is  reporting  a  loss  for  the  year  of  £1.92m
(2013: £2.04m), and Other Comprehensive Income loss
for  the  year  of  (£2.19m)  (2013:  £1.48)  for  which  the
signiﬁcant driver is the write down in the value of the
Company’s investment in Alecto, whose share price had
been at a 2 ½ year high at the end of 2013. Net assets
have remained unchanged at £4.75m (2013: £4.75m)
and  as  at  31  December  2014,  cash  balances  were
£1.78m  (2013:  £0.85m).  This  is  reﬂective  of  our
increased  tenement  holdings  in  Oman  and  targeted
evaluation programmes at our projects.

Cash  balances  during  the  period  were  also  bolstered
with a placing of £1.5m cash in March 2014 and two
placings  in  November  2014,  which  collectively  raised
£1.6m  cash.  These  placings  were  with  both  new  and
existing  investors  and  the  funds  raised  were  used  to
support exploration eﬀorts in Oman and Mozambique
and to provide working capital.

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CHAIRMAN’S STATEMENT

During  the  period  the  Board  also  took  the  strategic
decision to terminate the private placing agreement it
had with the Bergen Global Opportunity Fund, LP. This
agreement, which was made in April 2014, provided a
ﬂexible source of working capital. A total of £1.0m was
raised under this facility.

The Company recognises the necessity to reward key
executives fairly and appropriately for performance so
that it can operate on a sustainable basis. Mr Archer was
paid neither Directors’ fees nor salary either from the
time of his appointment as a Director in April 2013 or
from the time of his appointment as CEO in August 2013.
As a result of the Company’s signiﬁcant progress and the
transformational changes made, which saw the disposal
of all the Mali projects and the addition of projects in
Mozambique  and  Oman,  the  Board  elected  to
commence  paying  a  salary  to  the  CEO  eﬀective  from
April 2014.

Social Responsibility 
The Company and its management team are cognisant
of their social and environmental responsibilities in the
areas in which we operate and are committed to the
development  and  maintenance  of  good  relationships
with  local  communities.  To  this  end,  the  Board  has
formulated  a  Health,  Safety,  Environment  and
Community Relations policy that focuses on the positive
interaction with all parties. This policy has been adopted
and  already  forms  the  basis  for  eﬀective  community
relations in our permit areas.

Outlook
With  an  established  portfolio  of  highly  prospective
projects in place I am delighted with the progress we
continue  to  make.  Your  Board  remains  committed  to
maintaining  an  active  growth  path  for  the  Company
through 2015.

In Mozambique, with a Mineral Resource established
and  signiﬁcant  upside  opportunity  identiﬁed,  the
recommencement of drilling, will be another substantial
milestone in unlocking the project’s inherent value. This
is expected to commence late in the ﬁrst half of 2015.
In tandem with this planned exploration programme,
drilling of multiple, high calibre, near surface drill targets
in  Oman  is  currently  underway.  Although  we  have  a
strong understanding of our licence areas thanks to the
thorough evaluation work conducted to date by both
previous explorers and our ourselves, the collection and
analysis of drill data will provide greater clarity to the
resource potential of these mineral rich blocks. 

Importantly, we have a proven team with an excellent
track record in identifying promising exploration assets
into  proﬁtable,  producing
and  advancing  them 
companies.  With  this  industry  experience,  a  highly
prospective portfolio of assets in place, and targeted
development path to pave the road ahead, I expect 2015
to be a very active year for the Company. 

This will be the last Chairman’s Statement that I write as
I will be stepping down from the Board with eﬀect from
tomorrow.  It  has  been  my  pleasure  to  serve  as  the
Company’s Chairman for two years during which time
there has been signiﬁcant portfolio transformation and
organisational growth in size and capability.

Finally, I would like to take this opportunity to thank our
shareholders, advisers and management team for their
continued support and hard work and to welcome the
incoming Chairman, Matthew King, who has enjoyed a
very successful career and who is due to commence his
appointment tomorrow.

Mike Johnson
Chairman

Date: 24 February 2015

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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CHIEF EXECUTIVE’S REPORT

During 2014 Savannah has remained committed to its
strategy  of  building  a  geographically  diverse,  multi-
commodity exploration and development portfolio. I am
delighted  to  report  on  the  signiﬁcant  operational
progress that we have made during the period across
our  portfolio,  which  comprises  the  Blocks  4,  5  and  6
Copper Projects in the highly prospective, copper-rich,
Semail Ophiolite belt in the Sultanate of Oman, and our
Jangamo Heavy Mineral Sands Project in Mozambique. 

With  two  points  of  commodity  focus,  copper  and
mineral sands, I believe we have secured a signiﬁcant
portfolio from which to realise solid growth for the year
ahead and in-turn realise shareholder value. 

I am delighted to say that it has been a very active year.
We have completed multiple drilling and geophysical
exploration  programmes  over  multiple  projects  in
multiple geographies on time and on budget. This is a
clear demonstration of the technical and operational
capabilities  of  Savannah’s  team.  Our  activity  is  both
designed to get results and to leverage the maximum
impact oﬀ our ﬁxed cost base. 

Blocks 4, 5 and 6 Copper Projects, Oman 
Savannah has rights to three highly prospective blocks
covering 1,270km² in the copper-rich, Semail Ophiolite
belt in the Sultanate of Oman, which is proven to host
clusters of moderate to high grade copper deposits with
gold credits and metallurgically simple ores. The three
blocks are located some 180km north west of Muscat,
the capital city of Oman and within close proximity to
the export Port of Sohar. 

We  are  focusing  our  exploration  on  the  discovery  of
Cyprus type Volcanic Massive Sulphide (‘VMS’) deposits.
They  occur  on  and  below  fossil  seaﬂoors,  generally
within maﬁc to intermediate volcanic rocks and lesser
metalliferous  sediments/umbers.  Mineralisation 
is
comprised of two key zones, a massive sulphide zone
and an underlying stringer zone. 

We  believe  the  Blocks  provide  Savannah  with  an
excellent opportunity to potentially evolve into a mid-
tier copper producer in a relatively short time frame.
Together with our Omani partners, we aim to outline
further  mineral  resources  on  Blocks  4,  5  and  6,  to
provide the critical mass for a central operating plant to

develop the deposits as part of a broad consolidation
strategy. 

We very strongly believe that this is exactly the right
time in the cycle to be building an aggregated copper
resource in Oman. Projections by most informed copper
commentators and analysts highlight a copper deﬁcit
appearing in the period 2017 to 2020. This is projected
to support an increase in the copper price towards the
USD$4.00 per lb mark from today’s USD$2.50. 

The strategic market setting is therefore favourable and
this is matched by the extremely attractive features for
copper  mining  in  Oman.  These  features  include  a
favourable ﬁscal and legislative regime, a government
that  is  strongly  supportive  of  mining,  an  excellent
infrastructure base (roads, power, water, ports and a
copper smelter) and a favourable cost setting with very
low transport and fuel costs.

Savannah has the right to earn a 65% interest in Block 4,
a 65% holding in Block 5 and the right to earn up to a
70%  interest  in  Block  6.  The  acquisition  of  Gentor
Resources Limited, which has the rights to Blocks 5 and
6, was completed in July 2014 for an initial outlay of
USD$0.8  million  cash  with  deferred  consideration  of
USD$3.0  million 
in  cash  and  shares  payable  on
achievement of milestones relating to a potential mine
development (further information relating to the terms
of  the  acquisition  can  be  found  in  Note  21).  As  we
believe the region hosts a number of highly prospective
exploration opportunities we took the strategic decision
in-country  position  through  the
to  expand  our 
acquisition  of  Block  4;  in  November  2014  Savannah
entered  into  an  agreement  to  acquire  up  to  a  65%
shareholding  in  Al  Thuraya  LLC  by  spending  up  to
USD$4.6 million over 4 years. Al Thuraya wholly owns
the  highly  prospective  Block  4  (further  information
relating to the terms of the acquisition can be found in
Note 23). This acquisition increases the Company’s total
land package in Oman to 1,270 km². 

Block  5  currently  holds  a  near-surface,  collective
Indicated  and  Inferred  Mineral  Resource  of  1.7Mt  @
2.2% Cu (including a high-grade zone of ~0.5Mt @ 4.5%
Cu) which spans the Mahab 4 and Maqail South target
areas. Previous drilling on Block 5 has highlighted its
prospectivity with high grade intersections from multiple
areas including 56.35m at 6.21% Cu from the Mahab 4

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CHIEF EXECUTIVE’S REPORT

prospect, 6.68m at 7.42% Cu from Maqail South, 5.54m
at 3.96% Cu from Hara Kilab and 5m at 2.81% Cu from
Mahab  2.  Block  4  includes  over  35km  in  strike  of
prospective ophiolite with multiple prospective contacts,
has seen very little exploration using modern techniques
and is a prime target for the application of technologies
such as VTEM.

initially
Exploration  undertaken  by  Savannah  has 
focussed on evaluating potential open pittable targets.
First round re-processing of geophysical data (Versatile
Time Domain Electromagnetic airborne survey (‘VTEM’)
originally  completed  in  2010)  was  undertaken  by
Savannah  in  mid-2014  and  94  prospective  anomalies
were identiﬁed, with eight Priority 1 and 12 Priority 2
exploration targets identiﬁed on Blocks 5 and 6. 

In  addition,  ﬁeld  reconnaissance  by  way  of  a  ground
based electro-magnetic (‘EM’) survey of high priority
VTEM targets identiﬁed a new cluster of targets within
Block 5 and Block 4: Sarami West (Block 5), Wadi Ahin
(Block  5)  and  Ghayth  Prospect  (Block  4).  To  better
understand the mineralisation potential, Versatile Time
Domain  Electromagnetic  Surveying  (‘VTEM’)  was
completed in December 2014 over these targets, with
the results published post period end in January 2015. 

The strongest anomaly was identiﬁed at Sarami West,
which has a very high conductance, spans over 200m,
and  remains  open  to  the  south.  Importantly,  Sarami
West appears to be larger and of similar intensity to the
nearby  Mahab  4  copper  deposit  anomaly  where  an
Inferred Mineral Resource has been previously deﬁned,
illustrating the potential for resource expansion should
the drilling be successful. Furthermore, the VTEM survey
did  not  identify  any  potential  sources  for  a  false
anomaly, increasing the chances that the anomalies are
potentially  the  result  of  copper  bearing  sulphides  at
depth. 

It is our intention for the year ahead to advance Blocks
4, 5 and 6 up the value curve and accordingly a 2,000m
diamond  drilling  programme  commenced  in  January
2015. 

With a highly capable exploration team already in place
I  look  forward  to  utilising  our  in-country  advantage
within Oman’s mineral exploration industry as we focus
on  establishing  the  Company  as  a  mid-sized  copper

producer. I look forward to updating shareholders on this
progress throughout the year. 

is 

Jangamo Heavy Mineral Sands, Mozambique
As  previously  noted,  our  180km²  Jangamo  project  is
located  in  a  world-class  mineral  sands  province  in
southern  Mozambique.  The  Project 
located
immediately to the west of Rio Tinto’s (‘Rio’) Mutamba
deposit along an extensive dune system prospective for
mineral sands including ilmenite, zircon and rutile near
the village of Jangamo, approximately 350km north east
of the capital Maputo. Mutamba is one of two major
deposits  Rio  has  deﬁned  in  Mozambique,  which,
together  with  the  other  deposit  has  a  collective
exploration  target  of  7-12Bn  tonnes  at  3-4.5%  THM
(published in 2008). 

The prices for the main constituents of mineral sands,
(the  TiO2  feedstocks,  ilmenite,  rutile  and  zircon)  are
cyclically  weak  at  present.  Existing  producers  are
struggling  and  investment  in  exploration  is  limited.
Consumer demand for paints, paper and plastics will
inevitably  turn  up  as  will  prices  for  TiO2  feedstocks.
Companies like Savannah that secure strong resource
positions at this point of the cycle can be well rewarded.

We believe Mozambique is an ideal geography to put
this plan in place. The long, heavy mineral rich coastline
of Mozambique still remains relatively underexplored
and our experience over the last 18 months is that the
Mozambique  government  is  very  supportive  of  our
exploration investment in the country.

We have made signiﬁcant progress during 2014 with the
completion of three major rounds of scout and resource
deﬁnition drilling and an airborne geophysical survey.
The programmes have highlighted Jangamo’s potential
to host higher grade, commercial, heavy mineral sands
deposits. Signiﬁcantly, our exploration indicates that the
geology and geomorphology of Jangamo is similar to
that of Mutamba.

Consistent with our promise to the market we reached
a  major  milestone 
in  December  2014  with  the
announcement  of  a  maiden  JORC  compliant  Inferred
Mineral Resource of 65Mt at 4.5% total heavy minerals
(‘THM’). This was calculated after two separate drilling
programmes of 3,990m and 1,920m, and importantly, in
line with our strategy, successfully targeted extensions

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CHIEF EXECUTIVE’S REPORT

in  the  Jangamo
of  the  Mutamba  mineralisation 
tenement  with 
focus  of  deﬁning
mineralisation at the upper end of the grade range for
the Mutamba deposit of over 4% THM. Details of the
resource are contained in Table 1 below. 

the  primary 

Table 1

Resource Table (2.5% Cut oﬀ)
Zones
Category
Sand (Mt)
% THM
% Ilmenite in HM 
% Ilmenite in sand 
% Rutile in sand 
% Zircon in sand 
HM (Mt)
Ilmenite (Mt)
Rutile (Mt)
Zircon (Mt)

Jangamo
Inferred
65
4.2
60
2.5
0.083
0.15
2.7
1.6
0.054
0.1

Note: The table above has been prepared on a gross
basis  showing  100%  interest.  Savannah  has  an  80%
indirect interest in the Jangamo Project.

At  this  juncture  I  feel  it  is  important  to  note  the
signiﬁcant upside potential of the Jangamo project. The
maiden Mineral Resource was deﬁned and announced
in not much more than 12 months after we started our
ground work in Mozambique on what was essentially a
green ﬁelds’ tenement. Resource evaluation is staged in
nature  and  we  will  be  looking  to  further  expand  the
Mineral Resource during calendar 2015.

It is noteworthy that the maiden resource was deﬁned
over  two  small  areas  in  the  eastern  arm  of  the
tenement. These areas are a small part of the 180 km²
Jangamo tenement. The Mineral Resource remains open
along strike and there are a number of areas identiﬁed
during the 2014 exploration programme, which require
follow up work and resource drilling. 

Jangamo  is  a  large  system  and  we  are  focused  on
deﬁning  a  higher  grade  project  that  has  superior
economic  characteristics  for  the  development  of  a
proﬁtable mining operation with modest capital costs.
This  complements  the  favourable  local  infrastructure
setting that beneﬁts from nearby roads, power, and port. 

In this vein, further work is already planned for the 2015
ﬁeld  season 
including:  metallurgical  testwork  to
characterise  the  potential  product  from  any  project
development; further drilling around the newly deﬁned
Inferred  Mineral  Resource  to  further  expand  the
resource base; and further grid based resource drilling
around anomalous exploration drill holes. 

Signiﬁcantly we have also identiﬁed a major HMS system
in  the  western  part  of  the  tenement.  Scout  drilling
undertaken along the 15km strandline has intersected
encouraging  zones  of  mineralisation  with  excellent
intersections of up to 45m at 3.51% THM from 12m in
JMRC133. The western system, which extends over at
least 10km in strike, will form one of the main focuses
of the ongoing exploration programme in 2015.

Chairman 
I would also like to bring to shareholders’ attention the
fact  that  Mike  Johnson  has  decided  to  step  down  as
Chairman and eﬀective tomorrow is due to be replaced
by Matthew King. This change is a result of Mike having
successfully  steered  the  Company  through  its  recent
transitional phase where it exited its West African gold
projects and acquired interests in projects in its two new
core geographies of Oman and Mozambique in copper
and  heavy  minerals  respectively.  Under  Mike’s
stewardship the Company has strengthened its balance
sheet, established a key management group and secured
a valuable portfolio of new projects. Mike had always
made it clear that once this transitional phase had been
successfully implemented he would look to stand down
and in that regard the Company wishes to thank Mike
very much for his very signiﬁcant contribution and to
also wish him well in all his future endeavours. 

The Company is very fortunate to be able to appoint a
successor  with  the  experience  and  qualiﬁcations  of
Matthew  King.  Matthew  has  had  a 
long  and
distinguished  career  in  international  banking.  His
particular competencies are in the arenas of corporate
governance, operational risk and compliance.

Share Price
Savannah’s share price has traded in a very wide range
over the last 12 months. In recent days it has traded at
new lows. Clearly some of this is the result of the diﬃcult
market conditions generally for small cap explorers. This
has been exacerbated by the recent decline in the prices

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CHIEF EXECUTIVE’S REPORT 

of a wide range of commodities including copper. We
remain convinced that copper is the leading industrial
metal and the recent drop in its price will be short lived.

Despite  what  the  share  price  might  suggest  we  have
achieved a lot in 2014. We have secured a commanding
position in the Oman Ophiolite Belt which hosts a proliﬁc
number of copper deposits, and we have executed on
our plan; starting in July 2014 with the completion of the
acquisition  of  Blocks  5  and  6  in  Oman,  which  was
followed by the acquisition of Block 4, we have identiﬁed
prospective drill targets and are currently drilling away
– all within some seven months of starting. The timely
execution of these initial steps highlights both our intent
and capability to move forward and develop as a copper
producer. At the same time we have underscored the
prospectivity  of  Jangamo  with  the  declaration  of  a
maiden Mineral Resource. 

In summary, Savannah is a much more resilient company
in 2015 than it was in 2014 and is well positioned to
deliver shareholder value during 2015. 

Outlook
We have two very able operations teams in Oman and
Mozambique 
implementing  our  exploration  and
evaluation  activities.  In  Oman  the  next  step  in  our
evaluations  will  be  to  complete  a  1,200m  drilling
programme which started in late January 2015 at Block
5  and  Block  4,  on  a  number  of  high  priority  targets
identiﬁed. In conjunction with this, we look forward to
building  upon  the  now  established  Inferred  Mineral
Resource of 65Mt at 4.2% total heavy minerals at our
Jangamo Heavy Mineral Sands Project in Mozambique
through further drilling, planned to begin late in the ﬁrst
half of 2015.

In parallel with our existing activities as outlined here we
are working on other signiﬁcant associated initiatives
which  could  result  in  a  major  step  change  for  the
Company. I ﬁrmly believe that 2015 will be one of great
opportunity  for  Savannah,  and  I  look  forward  to
providing shareholders with regular updates on these
developments in due course. 

David S Archer
Chief Executive Oﬃcer

Date: 24 February 2015

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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STRATEGIC REPORT

Section  414A  of  the  Companies  Act  2006  (the  ‘Act’)
requires that the Company inform members as to how
the Directors have performed their duty to promote the
success of the Company, by way of a Strategic Report.

Set out below are the applicable reporting requirements
under the Act for the purposes of the Strategic Report,
together with guidance to other applicable sections of
the  2014  Annual  Report,  which  are  incorporated  by
reference into the Company’s Strategic Report.

General Exploration Risk
Mineral exploration is a high risk undertaking and there
can be no guarantee that exploration will result in the
discovery  of  an  economically  viable  ore  body.
Exploration tenements are carefully

selected by experienced experts in regions of proven
prospective geology. A methodical, staged approach is
taken to the work and diﬀerent technologies, as well as
extensive ﬁeldwork, are used prior to drilling.

Principal Activities 
The  principal  activity  of  the  Group  in  the  year  under
review  was  exploration  for  copper  in  Oman,  and
exploration for heavy mineral sands in Mozambique.

Fair Review of the Business
The  loss  of  the  Group  as  set  out  on  page  18 is  a  fair
reﬂection of the Group’s performance. The Group made
a  loss  of  £1,917,190  (2013:  £2,041,743),  of  which
to
(2013:  £905,576)  was 
£1,444,157 
administrative costs. Additionally the Company invested
£1,473,922 (2013: £824,638) on mineral exploration and
evaluation  on  the  licences  it  holds  (including  the
acquisition of Gentor Resources Ltd which has rights to
exploration Blocks 5 and 6 in Oman); this is capitalised
as  an  intangible  asset  as  set  out  in  Note  11  in  the
Financial Statements.

related 

The loss for the year excluded the revaluation loss of
£2,223,222 (2013: gain £1,430,435) in the Company’s
investment in Alecto detailed in Note 13.

A review of the Group’s prospects are included in the
Chairman’s  Statement  on  pages  2  to  3  and  the  Chief
Executive’s Report on pages 4 to 7.

information 

Future Development
This 
in  the  Chairman’s
is  contained 
Statement  on  pages  2  to  3  and  the  Chief  Executive’s
Report on pages 4 to 7 under the heading “outlook”.

Principal Risks and Uncertainties
The board has identiﬁed various risk factors which taken
individually or together may have a materially adverse
eﬀect on the Company’s business. The principal risks and
how they are managed are as follows:

Attraction and Retention of Key People 
The  success  of  the  Company  is  dependent  on  the
expertise  and  experience  of  the  Directors  and  senior
management and the loss of one or more could have a
material adverse eﬀect on the Company. The Board has
put  in  place  a  remuneration  policy  which  includes  a
share option scheme in order to motivate and retain key
employees.

Future Funding Requirements
The Company has an ongoing requirement to fund its
exploration activities and may need to obtain ﬁnance
from  the  equity  markets 
in  the  future.  Senior
Management  and  the  Board  closely  monitor  the
cashﬂows  of  the  Group.  Cashﬂow  projections  are
presented  regularly  to  the  Board  for  review  and  this
assists in ensuring expenditure is focussed on areas of
greatest  exploration  potential.  Overheads  and
administration costs are carefully managed.

Exploration Licence Titles
The licences will be subject to applications for renewal
and  any  renewal  is  usually  at  the  discretion  of  the
relevant  government  authority.  The  licences  in  the
Company’s portfolio have been the subject of legal due
diligence in order to establish valid legal title.

Country Risk
At  the  reporting  date,  the  Company  carried  out
exploration  in  Oman  and  Mozambique.  The  legacy
Malian projects were sold in March 2014. As a result, the
Company  operating  in  two  countries  beneﬁts  from  a
diversiﬁcation  of  country  risk.  Country  risk  is  further
mitigated  through  the  investment  it  holds  in  Alecto
which has exploration licences in Ethiopia, Mali, Burkina
Faso and Mauritania. This risk is mitigated by ensuring
its  work  and  expenditure
the  Company  meets 

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235402 Savannah p01-p17  26/02/2015  15:57  Page 9

STRATEGIC REPORT

development business. While the Directors believe the
expectation reﬂected herein to be reasonable in view of
the information available up to the time of the Board’s
approval of this Strategic Report, the actual outcome
may  be  materially  diﬀerent  owing  to  factors  either
beyond  the  Group’s  control  or  otherwise  within  the
Group’s  control  but,  for  example,  resulting  from  a
change  of  strategy.  Accordingly,  no  reliance  may  be
placed on the forward-looking statements.

On behalf of the Board:

David S Archer
Chief Executive Oﬃcer

Date: 24 February 2015 

that 

in-country
it  prioritises 
obligations, 
employment and that it maintains good relationships at
all levels with government, administrative bodies and
other stakeholders. The board actively monitors relevant
political and regulatory developments.

local 

Analysis of the Development and Performance of the
Business 
This information is contained in pages the Chairman’s
Statement on pages 2 to 3, and the Chief Executive’s
Report on pages 4 to 7.

Analysis of the Position of the Business
This information is contained in pages the Chairman’s
Statement on pages 2 to 3, and the Chief Executive’s
Report on pages 4 to 7.

Analysis Using Key Financial Performance Indicators
and Milestones

At the reporting date the Company’s cash balance was
£1,778,338  (2013:  £859,616)  and  its  investments  in
tradable securities was £1,129,602 (2013: £2,830,435).
The Company raised £3,769,095 (2013: £968,491) cash
via issuance of ordinary shares. The trading volumes in
the  Company’s  shares  increased  signiﬁcantly  to  over
3.7m shares per day in December 2014 (2013: 2.4m).

Analysis Using Other Key Performance Indicators and
Milestones

In July the Company acquired 100% of Gentor Resources
Ltd, which own the highly prospective Block 5 and Block
6 Copper Projects in Oman. In November the Company
entered  into  an  agreement  to  acquire  up  to  a  65%
shareholding in Al Thuraya LLC which own the highly
prospective  Block  4  Copper  Project  in  Oman.  In
December the Company announced a maiden inferred
JORC Mineral Resource Estimate of 65Mt at its Jangamo
Heavy Mineral Sands Project. The Company achieved its
strategic transformation from being a single commodity,
single  country  junior  explorer  to  becoming  a  multi-
commodity,  multi-geography 
and
development Company.

exploration 

Approval of the Board
This Strategic Report contains certain forward-looking
statements that are subject to the usual risk factors and
uncertainties associated with a mineral exploration and

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p01-p17  26/02/2015  15:57  Page 10

REPORT OF THE DIRECTORS

The  Directors  present  their  report  with  the  Financial
Statements of the Company and the Group for the year
ended 31 December 2014. 

Dividends
The  Directors  do  not  recommend  the  payment  of  a
dividend (2013: £nil).

Group’s Policy on Payment of Creditors
The Group’s policy on the payment of all trade creditors
is to ensure that the terms of payment, as speciﬁed and
agreed with creditors, are not exceeded. Trade creditors
as at 31 December 2014 represent 15 days (2013: 48
days) as a proportion of the total amount invoiced by
creditors during the year ended on that date.

Events Since the Reporting Date
The Company issued 637,381 new ordinary shares as
consideration  for  a  digitised  exploration  database
relating to the Block 4 Copper Project. The Company
disposed of 16.1m shares in Alecto for consideration of
£49k. The valuation of the Alecto shares at 31 December
2014 was based on a share price of £0.0065 and as at 23
February the share price was £0.0015. On 24 February
2015  the  Company  transferred  US$400,000  (~GBP
£257,500) as an initial capital contribution to achieve a
51%  shareholding  in  Al  Thuraya.  Further  details  are
included in Note 25 and in the Chairman’s Statement
and Chief Executive’s Report. 

Directors
The Directors who have held oﬃce during the period
from 1 January 2014 to the date of this report (unless
otherwise stated) are as follows: 

M S Johnson 
C Cannon-Brookes 
D S Archer 
D J Ferguson 

Directors’ Indemnity
The Group has agreed to indemnify its Directors against
third party claims which may be brought against them
and  has  in  place  a  Directors  and  Oﬃcers’  insurance
policy.

Financial Instruments Risk
This information is contained in Note 20 to the ﬁnancial
statements.

Going Concern
After making enquiries, the Directors have a reasonable
expectation  that  the  Company  and  the  Group  have
adequate resources to continue in operational existence
for the foreseeable future. For this reason they continue
to  adopt  the  going  concern  basis  in  preparing  the
Financial Statements. See Note 1 for further information.

Statement as to Disclosure of Information to Auditors
So far as the Directors are aware, there is no relevant
audit  information  (as  deﬁned  by  Section  418  of  the
Companies Act 2006) of which the Group’s auditors are
unaware, and each Director has taken all the steps that
he ought to have taken as a Director in order to make
himself aware of any relevant audit information and to
establish that the Group’s auditors are aware of that
information.

Auditors
The  auditors,  BDO  LLP,  will  be  proposed  for  re-
appointment  at  the  forthcoming  Annual  General
Meeting.

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SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

235402 Savannah p01-p17  26/02/2015  15:57  Page 11

REPORT OF THE DIRECTORS

The Directors’ beneﬁcial interest (including the beneﬁcial interests of their immediate family) in the ordinary shares
of the Company are as follows:

M S Johnson
D S Archer

No. of shares held at 
31 December 2014

No. of shares held at 
31 December 2013

4,040,000
22,222,224

4,040,000
22,222,224

The Directors’ interests in the share options, warrants options and warrants of the Company are as follows (further
details can be found in Note 24):

At 31 December 2014

Quantity Quantity
granted

at

Lapsed
1 Jan during the during the
year
year
2014

Options/
Warrants
at
31 Dec 
2014

Exercise
price

Date of
the grant

First
date of
exercise

Final 
date of 
exercise

Share Options
D J Ferguson 
M Johnson 
M Johnson
C Cannon-
Brookes 
C Cannon-
Brookes

Warrants
D S Archer
M S Johnson

5,321,776
1,500,000

–
–
– 2,030,000

–  5,321,776
–  1,500,000
– 2,030,000

3.0p  21/07/13  20/07/14  20/07/18 
3.0p  22/09/13  22/03/14  21/09/18 
03/07/17
5.0p 03/07/14

03/07/14

1,500,000

–

–  1,500,000

3.0p  22/09/13  22/03/14  21/09/18 

– 1,270,000

– 1,270,000

5.0p 03/07/14

03/07/14

03/07/17

11,111,112
4,475,000

–
– (4,475,000)

– 11,111,112
–

3.0p 24/09/13
12.5p 22/10/10

24/09/13
01/11/10

19/07/18
01/11/14

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235402 Savannah p01-p17  26/02/2015  15:57  Page 12

REPORT OF THE DIRECTORS

At 31 December 2013

Quantity Quantity
granted

at

Lapsed
1 Jan during the during the
year
year
2013

Options/
Warrants
at
31 Dec 
2013

Exercise
price

Date of
the grant

First
date of
exercise

Final 
date of 
exercise

Share Options
M C Jones*
M C Jones *
M C Jones *
D J Ferguson 
M Johnson 
C Cannon-
Brookes 
S D Oke*
D D Chikohora* 
R A Williams* 

3,000,000 

–  2,100,000 
–  1,575,000 
–  5,321,776 
–  1,500,000 

– (1,500,000) 1,500,000 
(700,000)  1,400,000 
–  1,575,000 
–  5,321,776 
–  1,500,000 

21/10/11

10.0p 22/10/10
21/10/15
4.62p  01/02/13  31/01/14  31/01/18 
4.62p  30/09/13  30/09/13  01/10/18 
3.0p  21/07/13  20/07/14  20/07/18 
3.0p  22/09/13  22/03/14  21/09/18 

–  1,500,000 
–
– 
–

750,000 
600,000 
500,000 

–  1,500,000 
–
– 
–

(750,000) 
(600,000) 
(500,000) 

3.0p  22/09/13  22/03/14  21/09/18 
21/10/15
21/10/15
06/03/16

10.0p  22/10/10
10.0p  22/10/10
16.1p  07/03/11

21/10/11
21/10/11
07/03/11

Warrant Options
M C Jones*
S D Oke*
D D Chikohora* 

3,000,000 
750,000 
600,000 

– (1,500,000) 1,500,000 
–
–
– 
– 

(750,000)
(600,000)

12.5p 22/10/10
12.5p 22/10/10
12.5p 22/10/10

21/10/11
21/10/11
21/10/11

21/10/15
21/10/15
21/10/15

Warrants
M C Jones*
M S Johnson
D S Archer

1,850,000 
4,475,000

–
–
– 11,111,112

– 1,850,000
– 4,475,000
– 11,111,112

12.5p 22/10/10
12.5p 22/10/10
3.0p 24/09/13

01/11/10
01/11/10
24/09/13

01/11/14
01/11/14
19/07/18

*resigned during the year to 31 December 2013

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235402 Savannah p01-p17  26/02/2015  15:57  Page 13

REPORT OF THE DIRECTORS

The remuneration of Directors who held oﬃce during the year was as follows:

Directors’
emoluments 2014

Directors’
emoluments 2013

Cash Non-cash
share

Salary

Total

Cash Non-cash 
share

Salary

Total

Executive Directors
D J Ferguson 
D S Archer*
M C Jones (resigned 30 September 2013)
Non-Executive Directors
M S Johnson
C Cannon-Brookes
S D Oke (resigned 5 February 2013)
D D Chikohora (resigned 5 February 2013)
R A Williams (resigned 5 February 2013)
C Harrison (resigned 21 May 2013)

76,778
142,500
–
–
–
–
–
–
–
–

219,278

7,381
–
–
–
41,008
26,036
–
–
–
–

74,425

84,159
142,500
–
–
41,008
26,036
–
–
–
–

29,151
–
188,783
–
–
–
23,333
14,583
14,583
–

35,192
–
9,634
–
35,583
35,583
–
–
–
–

64,343
–
198,417
–
35,583
35,583
23,333
14,583
14,583
–

293,703

270,433

115,992

386,425

*Mr D S Archer was paid neither Directors’ fees nor salary either from the time of his appointment as a Director in April 2013 or from
the time of his appointment as CEO in August 2013. As a result of the Company’s signiﬁcant progress and the transformational changes
made which saw the disposal of all the Mali projects, the acquisition of new projects in Mozambique and Oman and the marked
increase in the scale and scope of the Company’s activities the board elected to commence paying a salary to the CEO eﬀective from
April 2014. There is no entitlement to bonus payments.

On behalf of the board:

D S Archer
Chief Executive Oﬃcer

Date: 24 February 2015

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p01-p17  26/02/2015  15:57  Page 14

CORPORATE GOVERNANCE STATEMENT

The Company, being listed on AIM, is not required to
comply with the UK Corporate Governance Code (“the
Code”) issued in May 2010. Although the Company does
not comply with the Code, it has given consideration to
the provisions set out in Section 1 of the Code annexed
to  the  Financial  Conduct  Authority  Listing  Rules.  The
Directors support the objectives of the Code and intend
to comply with those aspects that they consider relevant
to the Group’s size and circumstances. Details of these
are set out below.

The Board of Directors
The Board currently comprises two executive and two
non-executive  Directors.  The  Board  formally  meets
approximately every month and is responsible for setting
and monitoring Group strategy, reviewing budgets and
ﬁnancial  performance,  ensuring  adequate  funding,
examining major acquisition opportunities, formulating
policy on key issues and reporting to the shareholders.

Internal Financial Control
The Board is responsible for establishing and maintaining
the Group’s system of internal ﬁnancial controls. Internal
ﬁnancial  control  systems  are  designed  to  meet  the
particular needs of the Group and the risk to which it is
exposed, and by its very nature can provide reasonable,
but  not  absolute,  assurance  against  material
misstatement or loss. The Directors are conscious of the
need to keep eﬀective internal ﬁnancial control. Due to
the relatively small size of the Group’s operations, the
Directors  are  very  closely  involved  in  the  day-to-day
running of the business and as such have less need for a
detailed formal system of internal ﬁnancial control. The
Directors  have  reviewed  the  eﬀectiveness  of  the
procedures presently in place and consider that they are
appropriate to the nature and scale of the operations of
the Group. The Directors have implemented necessary
controls and procedures to comply with the UK Bribery
Act 2010.

The Audit Committee
An  Audit  Committee  has  been  established  which
comprises  two  non-executive  Directors  –  Charlie
Cannon-Brookes  (who  chairs  the  Committee),  Dale
is
Ferguson  and  Mike  Johnson.  The  Committee 
responsible for ensuring that the ﬁnancial performance
of the Group is properly reported on and monitored, and
for meeting the auditors and reviewing the reports from
the auditors relating to accounts and internal controls.
The  Committee  also  reviews  the  Group’s  annual  and
interim Financial Statements before submission to the
Board for approval. The role of the Audit Committee is
also to consider the appointment of the auditors, audit
fees, scope of audit work and any resultant ﬁndings.

It 

The Remuneration Committee
The  Remuneration  Committee  comprises  two  non-
executive  Directors  –  Charlie  Cannon-Brookes  (who
chairs  the  Committee)  and  Mike  Johnson. 
is
responsible  for  reviewing  the  performance  of  the
executive  Directors  and  for  setting  the  scale  and
structure of his remuneration, paying due regard to the
interests  of  shareholders  as  a  whole  and  the
performance  of  the  Group.  The  remuneration  of  the
Chairman and the non-executive Director is determined
by  the  Board  as  a  whole,  based  on  a  review  of  the
current practices in other companies. The Chairman and
non-executive Director are entitled to a nominal value
of £1 per annum for their services.

Anti-Bribery and Corruption
It  is  the  Company’s  policy  to  conduct  business  in  an
honest way, and without the use of corrupt practices or
acts of bribery to obtain an unfair advantage in line with
the UK Bribery Act 2010. The Company takes a zero-
tolerance  approach  to  bribery  and  corruption  and  is
committed  to  acting  professionally,  fairly  and  with
integrity  in  all  its  business  dealings  and  relationships
wherever it operates and implementing and enforcing
eﬀective systems to counter bribery.

The  Directors  are  responsible  for  preparing  the
Director’s  report  and  the  Financial  Statements  in
accordance with applicable law and regulations

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235402 Savannah p01-p17  26/02/2015  15:57  Page 15

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

Website Publication
The Directors are responsible for ensuring the Annual
Report and the Financial Statements are made available
on a website. Financial statements are published on the
Company’s website in accordance with legislation in the
United  Kingdom  governing  the  preparation  and
dissemination of Financial Statements, which may vary
from legislation in other jurisdictions. The maintenance
is  the
integrity  of  the  Company’s  website 
and 
responsibility  of 
the  Directors.  The  Directors’
responsibility also extends to the ongoing integrity of the
Financial Statements contained therein.

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 for that period. The
Directors  are  also  required  to  prepare  Financial
Statements in accordance with the rules of the London
Stock Exchange for companies trading securities on the
Alternative Investment Market. 

In preparing these Financial Statements, the Directors
are required to:

•

select suitable accounting policies and then apply
them consistently;

• make judgements and accounting estimates that are

reasonable and prudent;

•

•

state  whether  they  have  been  prepared 
in
accordance with IFRSs as adopted by the European
Union, subject to any material departures disclosed
and explained in the Financial Statements;

prepare  the  Financial  Statements  on  the  going
concern basis unless it is inappropriate to presume
that the Company will continue in business.

The  Directors  are  responsible  for  keeping  adequate
accounting  records  that  are  suﬃcient  to  show  and
explain the Company’s transactions and disclose with
reasonable accuracy at any time the ﬁnancial position of
the  Company  and  enable  them  to  ensure  that  the
Financial Statements comply with the requirements of
the Companies Act 2006. They are also responsible for
safeguarding the assets of the Company and hence for
taking reasonable steps for the prevention and detection
of fraud and other irregularities.

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p01-p17  26/02/2015  15:57  Page 16

REPORT OF THE INDEPENDENT AUDITORS

to the members of Savannah Resources Plc

We have audited the ﬁnancial statements of Savannah resources Plc for the year ended 31 December 2014 which
comprise the consolidated statement of comprehensive income, the consolidated and Company statement of
ﬁnancial position, the consolidated and Company statement of changes in equity, the consolidated and Company
statement of cash ﬂows and the related notes. The ﬁnancial reporting framework that has been applied in their
preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European
Union  and,  as  regards  the  parent  Company  statements,  as  applied  in  accordance  with  the  provisions  of  the
Companies Act 2006. 

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.

Respective Responsibilities of Directors and Auditors
As  explained  more  fully  in  the  statement  of  Directors’  responsibilities,  the  Directors  are  responsible  for  the
preparation of the ﬁnancial statements and for being satisﬁed that they give a true and fair view. Our responsibility
is to audit and express an opinion on the ﬁnancial statements in accordance with applicable law and International
Standards on Auditing (UK and Ireland). Those standards require us to comply with the Financial Reporting Council’s
(FRC’s) Ethical Standards for Auditors. 

Scope of the Audit of the Financial Statements
A  description  of  the  scope  of  an  audit  of  ﬁnancial  statements  is  provided  on  the  FRC’s  website  at
www.frc.org.uk/apb/scope/private.cfm. 

Opinion on Financial Statements
In our opinion: 

•

•

•

the ﬁnancial statements give a true and fair view of the state of the group’s and the parent Company’s aﬀairs
as at 31 December 2014 and of the group’s loss for the year then ended;

the group ﬁnancial statements have been properly prepared in accordance with IFRSs as adopted by the
European Union;

the parent Company ﬁnancial statements have been properly prepared in accordance with IFRSs as adopted
by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

•

the ﬁnancial statements have been prepared in accordance with the requirements of the Companies Act 2006.

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REPORT OF THE INDEPENDENT AUDITORS

Opinion on Other Matters Prescribed by the Companies Act 2006
In our opinion the information given in the strategic and Directors’ reports for the ﬁnancial year for which the
ﬁnancial statements are prepared is consistent with the ﬁnancial statements. 

Matters on Which we are Required to Report by Exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report
to you if, in our opinion:

•

•

•

adequate accounting records have not been kept by the parent Company, or returns adequate for our audit
have not been received from branches not visited by us; or

the parent Company Financial Statements are not in agreement with the accounting records and returns; or

certain disclosures of Directors’ remuneration speciﬁed by law are not made; or

• we have not received all the information and explanations we require for our audit.

Scott Knight (senior statutory auditor)
For and on behalf of BDO LLP, statutory auditor
55 Baker Street
London
W1U 7EU
United Kingdom
24 February 2015

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

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235402 Savannah p18-p24  26/02/2015  15:57  Page 18

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31 December 2014

Continuing Operations
Revenue
Administrative expenses

Operating loss
Finance income
Finance costs

Loss before tax
Taxation

Loss for period from continuing operations
Loss for the period from discontinued operations

Loss for the year attributable 
To equity owners of the parent
Other comprehensive income
Change in market value of investments
Exchange gains/(losses) arising on translation of foreign operations

Other comprehensive income for the year

Total comprehensive income for the year
attributable to equity owners of the parent

Loss per share attributable to equity owners of the parent 
expressed in pence per share: 
Basic and diluted
From Loss for the year attributable to equity owners of the parent
From Continuing operations
From Discontinued operations

Notes

2014
£

2013
£

(1,444,157)

(1,444,157)
18,818
(491,851)

(1,917,190)
–

(1,917,190)
–

–
(905,576)

(905,576)
228,433
–

(677,143)
–

(677,143)
(1,364,600)

(1,917,190)

(2,041,743)

(2,223,222)
31,350

(2,191,872)

1,430,435
51,990

1,482,425

(4,109,062)

(559,318)

(1.14)
(1.14)
–

(2.04)
(0.68)
(1.36) 

5
5

6
7

8

13

10
10
10

The notes form part of these Financial Statements.

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 31 December 2014

Assets
Non-current assets
Intangible assets
Property, plant and equipment
Investments
Other receivables

Total non-current assets

Current assets
Investments
Loan receivables
Trade and other receivables
Cash and cash equivalents

Total current assets

Total assets

Equity and liabilities
Shareholders’ equity
Share capital
Share premium
Foreign currency reserve
Warrant reserve
Share based payment reserve
Merger reserve
Retained earnings

Total equity attributable to 
Equity holders of the parent

Liabilities
Current liabilities
Trade and other payables

Total liabilities

Total equity and liabilities

Notes

2014
£

2013
£

11
12
13
15

13
14
15
16

18

1,974,128
30,245
–
17,049

2,021,422

1,129,602
–
82,590
1,778,338

2,990,530

5,011,952

699,138
–
2,830,435
2,998

3,532,571

–
573,380
108,215
859,616

1,541,211

5,073,782

2,231,697
8,539,626
36,171
362,252
619,423
–
(7,034,355)

1,383,658
5,460,305
35,578
850,611
497,181
572,314
(4,045,757)

4,754,814

4,753,890

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257,138

257,138

319,892

319,892

5,011,952

5,073,782

The Financial Statements were approved by the Board of Directors on 24 February 2015 and were signed on its
behalf by: 

D S Archer
Executive Director
Company number: 07307107

The notes form part of these Financial Statements.

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235402 Savannah p18-p24  26/02/2015  15:57  Page 20

COMPANY STATEMENT OF FINANCIAL POSITION

as at 31 December 2014

Assets
Non-current assets
Intangible assets
Investments
Other receivables

Total non-current assets

Current assets
Investments
Loan receivables
Trade and other receivables
Cash and cash equivalents

Total current assets

Total assets

Equity and liabilities
Shareholders’ equity
Called up share capital
Share premium
Warrant reserve
Share based payment reserve
Retained earnings
Merger reserve

Total equity

Liabilities
Current liabilities
Trade and other payables

Total liabilities

Total equity and liabilities

Notes

2014
£

2013
£

11
13
15

13
14
15
16

18

19

47,391
281
2,301,121

2,348,793

1,129,602
–
58,994
1,634,371

2,822,967

5,171,760

3,153
2,956,562
310,354

3,270,069

–
573,380
107,225
855,023

1,535,628

4,805,697

2,231,697
8,539,626
362,251
619,423
(6,738,170)
–

1,383,658
5,460,305
850,611
497,181
(3,424,075)
(82,188)

5,014,827

4,685,492

156,933

156,933

120,205

120,205

5,171,760

4,805,697

The Financial Statements were approved by the Board of Directors on 24 February 2015 and were signed on its
behalf by: 

D S Archer
Executive Director
Company number: 07307107

The notes form part of these Financial Statements.

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the year ended 31 December 2014

Share
Share
capital premium
£

£

Foreign
currency Warrant
reserve
£

reserve
£

Share 
based 
payment 
reserve 
and 
warrant
reserve
£

Retained
earnings
£

Merger 
reserve
£

Total
equity
£

At 1 January 2013 842,133 4,997,699

(16,412)

579,500

577,260 (3,646,829)

572,314 3,905,665

Loss for the year
Other comprehensive 
income

Total comprehensive 
income for the year
Issue of share 
capital
Issue of warrants
Share based payments
Share options lapsed

541,525
–
–
–

Loss for the year
Other comprehensive
income

–

–

–

Total comprehensive 
income for the year
Issue of share 
capital
Issue of warrants
Expiry of warrants
Disposal of subsidiaries
Foreign exchange 
on disposal of subsidiaries–
–
Share based payments

–
–

–

–

–

–

–

–

–

51,990

51,990

–

–

–

– (2,041,743)

– (2,041,743)

– 1,430,435

– 1,482,425

–

(611,308)

–

(559,318)

733,717
(271,111)
–
–

–
–
–
–

–
271,111
–
–

132,301
(212,380)

–
–
–
212,380

– 1,275,242
–
–
132,301
–
–
–

At 31 December 
2013

1,383,658 5,460,305

35,578

850,611

497,181 (4,045,757)

572,314 4,753,890

–

–

–

–

31,350

31,350

–

–

–

– (1,917,190)

– (1,917,190)

– (2,223,222)

– (2,191,872)

– (4,140,412)

– (4,109,062)

848,039 3,170,461
(91,140)
–
–

–
–
–
–

–
91,140
(579,500)
–

–
–
–
–

–
–
579,500
572,314

– 4,018,500
–
–
–
–
–
(572,314)

–
–

(30,757)
–

–
–

–
122,242

–
–

–
–

(30,757)
122,242

At 31 December
2014

2,231,697 8,539,626

36,171

362,252

619,423 (7,034,355)

– 4,754,814

The following describes the nature and purpose of each reserve within owners’ equity:

Reserve

Share capital

Share premium

Description and purpose

Amounts subscribed for share capital at nominal value.

Amounts subscribed for share capital in excess of nominal value.

Foreign currency reserve

Gains/losses arising on retranslating the net assets of Group operations into Pound Sterling.

Warrant reserve
Share based payment reserve

Retained earnings
Merger reserve

Fair value of the warrants issued.
Represents the accumulated balance of share based payment charges recognised in respect of share options
granted by Savannah Resources Plc, less transfers to retained losses in respect of options exercised and lapsed.
Cumulative net gains and losses recognised in the consolidated statement of comprehensive income.
Amounts resulting from acquisitions under common control.

The notes form part of these Financial Statements.

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235402 Savannah p18-p24  26/02/2015  15:57  Page 22

COMPANY STATEMENT OF CHANGES IN EQUITY

for the year ended 31 December 2014

Share
capital premium
£

Share Warrant
reserve
£

£

Share 
based 
payment
reserve
£

Retained
earnings
£

Merger 
reserve
£

Total
equity
£

At 1 January 2013

842,133 4,997,699

579,500

577,260 (3,008,739)

(82,188) 3,905,665

Loss for the year
Other comprehensive income

–
–

–
–

–
–

– (2,058,151)
– 1,430,435

– (2,058,151)
– 1,430,435

Total comprehensive income
for the year
Issue of share capital
Issue of warrants
Share based payments
Share options lapsed

–
541,525
–
–
–

–
733,717
(271,111)
–
–

–
–
271,111
–
–

–
–
–
132,301
(212,380)

(627,716)
–
–
–
212,380

–
(627,716)
– 1,275,242
–
–
132,301
–
–
–

At 31 December 2013

1,383,658 5,460,305

850,611

497,181 (3,424,075)

(82,188) 4,685,492

Loss for the year
Other comprehensive income

–
–

–
–

–
–

– (1,588,185)
– (2,223,222)

– (1,588,185)
– (2,223,222)

Total comprehensive 
income for the year
Issue of share capital
Issue of warrants
Expiry of warrants
Disposal of subsidiaries
Share based payments

–

–
848,039 3,170,461
(91,140)
–
–
–

–
–
–
–

–
–
91,140
(579,500)
–
–

– (3,811,407)
–
–
–
–
579,500
–
(82,188)
–
–
122,242

– (3,811,407)
– 4,018,500
–
–
–
–
–
82,188
122,242
–

At 31 December 2014

2,231,697 8,539,626

362,251

619,423 (6,738,170)

– 5,014,827

The following describes the nature and purpose of each reserve within owners’ equity:

Reserve

Share capital

Description and purpose

Amounts subscribed for share capital at nominal value.

Share premium

Amounts subscribed for share capital in excess of nominal value.

Warrant reserve

Fair value of the warrants issued.

Share based payment reserve

Represents the accumulated balance of share based payment charges recognised
in respect of share options granted by Savannah Resources Plc, less transfers to
retained losses in respect of options exercised and lapsed.

Retained earnings

Cumulative net gains and losses recognised in the consolidated statement of
comprehensive income.

Merger reserve

Amounts resulting from acquisitions under common control.

The notes form part of these Financial Statements.

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235402 Savannah p18-p24  26/02/2015  15:57  Page 23

CONSOLIDATED STATEMENT OF CASH FLOWS

for the year ended 31 December 2014

Cash ﬂows used in operating activities
Loss for the year
Depreciation and amortisation charges
Impairment of intangible assets 
Proﬁt on disposal of subsidiaries
Share based payment reserve charge
Shares issued in lieu of payments to extinguish liabilities
Finance income
Finance expense

Cash ﬂow from operating activities before changes 
in working capital
Decrease/(increase) in trade and other receivables
(Decrease)/increase in trade and other payables

Net cash used in operating activities

Cash ﬂow used in investing activities
Disposal of subsidiaries 
Purchase of intangible exploration assets
Purchase of tangible ﬁxed assets
Purchase of convertible loan notes
Purchase of investments
Interest received

Net cash used in investing activities

Cash ﬂow from ﬁnancing activities
Interest paid
Proceeds from issues of ordinary shares

Net cash from ﬁnancing activities

Increase/(Decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year 
Exchange diﬀerences

Cash and cash equivalents at end of year

Notes

2014
£

2013
£

11
4

5

(1,917,190)
12,254
–
–
122,242
75,290
(18,818)
491,851

(1,234,371)
10,574
(106,739)

(1,330,536)

–
(1,429,884)
(37,733)
–
–
4,842

(2,041,743)
30,231
1,362,402
(180,048)
132,301
75,750
(228,433)
–

(849,540)
(81,973)
140,066

(791,447)

(21,653)
(593,638)
(6,380)
(350,000)
(150,000)
5,053

(1,462,775)

(1,116,618)

(2,768)
3,769,095

3,766,327

973,016
859,616
(54,294)

–
968,491

968,491

(939,574)
1,767,381
31,809

1,778,338

859,616

The cash ﬂows from discontinued operations are disclosed in Note 8 to the Financial Statements.

The notes form part of these Financial Statements.

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235402 Savannah p18-p24  26/02/2015  15:57  Page 24

COMPANY STATEMENT OF CASH FLOWS

for the year ended 31 December 2014

Cash ﬂows used in operating activities
Loss for the year
Depreciation and amortisation charges
Impairment of intercompany receivables
Proﬁt on disposal of subsidiaries
Share based payment reserve charge
Shares issued in lieu of payments to extinguish liabilities
Finance income
Finance expense

Cash ﬂow from operating activities before changes in working capital
Increase in trade and other receivables
Increase/(decrease) in trade and other payables

Net cash used in operating activities

Cash ﬂow used in investing activities
Investment in subsidiaries
Purchase of convertible loan notes
Purchase of investments 
Purchase of intangible exploration assets
Interest received

Net cash used in investing activities

Cash ﬂow from ﬁnancing activities
Interest paid
Proceeds from issues of ordinary shares

Net cash from ﬁnancing activities

Increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

(1,588,185)
3,153
–
(41,753)
122,242
75,290
(18,367)
491,163

(956,457)
(2,024,857)
36,729

(2,058,151)
2,910
2,562,753
(1,249,900)
132,301
75,750
(228,433)
–

(762,770)
(672,454)
56,805

(2,944,585)

(1,378,419)

(81) 
–
–
(47,391)
4,482

(42,990)

(2,172)
3,769,095

3,766,923

779,348
855,023

–
(350,000)
(150,000)

5,053

(494,947)

–
968,491

968,491

(904,875)
1,759,898

1,634,371

855,023

The notes form part of these Financial Statements.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

for the year ended 31 December 2014

1. ACCOUNTING POLICIES
Basis of Preparation
These Financial Statements have been prepared in accordance with International Financial Reporting Standards,
International Accounting standards and Interpretations (collectively “IFRSs”) as adopted by the EU and IFRIC
interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.
The Financial Statements have been prepared under the historical cost convention. 

The  consolidated  Financial  Statements  have  been  prepared  by  the  merger  method  of  accounting  on  the
historical cost basis except, as explained in the accounting policies below. Historical cost is generally based on
the consideration given in exchange for assets. The principal accounting policies are set out below.

Presentational and Functional Currency
The  functional  currency  of  the  Company  is  Pound  Sterling.  Each  entity  in  the  Group  determines  its  own
functional currency and items included in the Financial Statements of each entity are measured using that
functional currency. The presentational currency of the Group is Pound Sterling.

Going Concern
The Financial Statements have been prepared on a going concern basis. The Board consider that the Group has
suﬃcient cash resources to enable it to continue to fund overheads and exploration on its projects.

Basis of Consolidation
The  Group  accounts  consolidate  the  accounts  of  Savannah  Resources  Plc  and  its  domestic  and  foreign
subsidiaries, refer to Note 13. The foreign subsidiaries have been consolidated in accordance with IAS 27 and
IAS 21 “The eﬀects of Foreign Exchange Rates.”

Inter-company transactions and balances between Group companies are eliminated in full.

Equity Investments
Equity investments excluding subsidiaries are included on the balance sheet at fair value with value changes
being recognised in other comprehensive income. 

Investments in equity instruments with no reliable fair value measurement are measured at cost.

Investments in Subsidiaries and Associates
Investments in subsidiaries, associates and jointly controlled entities are accounted for at cost within the
individual accounts of the parent Company. These investments are classiﬁed as non-current assets on the
balance sheet of the parent Company.

Investments in subsidiaries, associates and jointly controlled entities are accounted for under the equity method
of accounting within the consolidated accounts of the parent Company whereby the investment is initially
recognised at cost and adjusted thereafter for changes in the investor’s share of the investee’s net assets. The
investor’s proﬁt or loss includes its share of the investee’s proﬁt or loss and the investor’s other comprehensive
income includes its share of the investee’s other comprehensive income.

Foreign Currencies
Transactions in foreign currencies are initially recorded in the functional currency by applying spot exchange
rate ruling at the date of transaction. Monetary assets and liabilities denominated in foreign currencies are
retranslated at the functional currency rate of exchange ruling at the reporting date.

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p25-p53  26/02/2015  15:57  Page 26

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES continued

The income statements of individual Group companies with functional currencies other than Pound Sterling
are translated into Pound Sterling at the average rate for the period and the balance sheet translated at the
rate of exchange ruling on the reporting date. Exchange diﬀerences which arise from retranslation of the
opening net assets and results of such subsidiary undertakings are taken to equity (“foreign currency reserve”).
On disposal of such entities, the deferred cumulative amount recognised in equity relating to that particular
operation is transferred to the consolidated statement of comprehensive income as part of the proﬁt or loss
on disposal.

Intangible Assets
Deferred development costs
Once  an  exploration  licence  or  an  option  to  acquire  an  exploration  licence  has  been  obtained,  all  costs
associated with mineral property development and investments are capitalised on a project-by-project basis
pending  determination  of  the  feasibility  of  the  project.  Costs  incurred  include  appropriate  technical  and
administrative expenses but not general overheads. If a mining property development project is successful, the
related expenditures will be amortised over the estimated life of the commercial ore reserves on a unit of
production basis. Where a licence is relinquished, a project is abandoned, or is considered to be of no further
commercial value to the Savannah Resources Group, the related costs will be written oﬀ.

Unevaluated mineral properties are assessed at reporting date for impairment in accordance with the policy
set out below. For the purposes of assessing impairment, assets are grouped at the lowest level for which there
are separately identiﬁable cash ﬂows (cash generating units) as disclosed in Note 11.

If  commercial  reserves  are  developed,  the  related  deferred  development  and  exploration  costs  are  then
reclassiﬁed as development and production assets within property, plant and equipment.

Mineral properties
Mineral properties are recorded at cost less amortisation and provision for diminution in value. Amortisation
will be over the estimated life of the commercial ore reserves on a unit of production basis.

Acquisitions of Mineral Exploration Licences
The acquisition of Gentor Resources Limited and Matilda Minerals Lda, was principally the acquisition of mining
licences eﬀected through a non-operating corporate structure. As the structure does not represent a business,
it is considered that the transaction does not meet the deﬁnition of a business combination. Accordingly the
transaction  is  accounted  for  as  the  acquisition  of  an  asset.  Future  consideration  is  contingent  and  is  not
recognised as an asset or liability.

Other intangible assets
Other intangibles are recorded at cost less amortisation and provision for diminution in value. Amortisation is
calculated to write oﬀ the cost of each asset over its estimated useful life of 3 years.

Property, Plant and Equipment
Tangible non-current assets used in exploration and evaluation are classiﬁed within tangible non-current assets
as property, plant and equipment. To the extent that such tangible assets are consumed in exploration and
evaluation the amount reﬂecting that consumption is recorded as part of the cost of the intangible asset. 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES continued

Depreciation is provided on all items of property, plant and equipment in order to write oﬀ the cost less
estimated residual value of each asset over its estimated useful life.

Plant & Machinery
Oﬃce Equipment
Motor Vehicles

4 – 10 years
4 years
4 years

Financial Instruments
Financial assets and ﬁnancial liabilities are recognised in the Group’s statement of ﬁnancial position when the
Group becomes a party to the contractual provisions of the instrument.

Financial Assets
Loans and receivables
Loans and receivables 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 Savannah Resources Group
will be unable to collect all of the amounts due under the terms receivable, the amount of such a provision
being the diﬀerences between the net carrying amount and the present value of the future expected cash ﬂows
associated with the impaired receivable. For receivables, which are reported net, such provisions are recorded
in a separate allowance account with the loss being recognised within administrative expenses in the statement
of comprehensive income. On conﬁrmation that the receivable will not be collectable, the gross carrying value
of the asset is written oﬀ against the associated provision.

The Savannah Resources Group’s loan and receivables comprise other receivables and cash and cash equivalents
in the Consolidated Statement of Financial Position. Cash and cash equivalents comprise cash in hand and
balances held with banks. Cash equivalents are short term, highly liquid accounts that are readily converted to
known amounts of cash.

There is no signiﬁcant diﬀerence between carrying value and fair value of loans and receivables. 

Derivatives and embedded derivatives
Derivatives  are  accounted  for  on  the  balance  sheet  at  fair  value  with  changes  recognised  in  the  income
statement. Fair values are determined using the Black Scholes valuation methodology.

Embedded derivatives are separated from their host contracts and accounted for as derivatives when they meet
the deﬁnition of a derivative and the characteristics can be separated from those of the host contract. 

Financial Liabilities
Other liabilities
Other liabilities consist of trade and other payables, which are initially recognised at fair value and subsequently
carried at amortised cost, using the eﬀective interest method.

There is no signiﬁcant diﬀerence between the carrying value and fair value of other liabilities.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES continued

Taxation
Current taxes are based on the results shown in the Financial Statements and are calculated according to local
tax rules, using tax rates enacted or substantively enacted by the reporting date.

Deferred tax is recognised in respect of all timing diﬀerences that have originated but not reversed at the
reporting date. A deferred tax asset is recognised to the extent that it is probable that future taxable proﬁts
will be available against which timing diﬀerences can be utilised. 

Operating Leases
Rentals payable under operating leases are charged to the income statement on a straight-line basis over the
term of the relevant lease.

Share-based Payments
Where equity settled share options are awarded to Directors and employees, the fair value of the options at
the date of grant is charged to the Consolidated Statement of Comprehensive Income over the vesting period.
Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected
to vest at each reporting date so that, ultimately, the cumulative amount recognised over the vesting period is
based on the number of options that eventually vest. Market vesting conditions are factored into the fair value
of the options granted. As long as all other vesting conditions are satisﬁed, a charge is made irrespective of
whether the market vesting conditions are satisﬁed. The cumulative expense is not adjusted for failure to
achieve a market vesting condition.

Where the terms and conditions of options are modiﬁed before they vest, the change in the fair value of the
options, measured immediately before and after the modiﬁcation, is also charged to the Consolidated Statement
of Comprehensive Income over the remaining vesting period.

Where equity instruments are granted to persons other than employees for goods and services received, the
Consolidated Statement of Comprehensive Income is charged with the fair value of goods and services received
or where this is not possible at the fair value of the equity instruments granted. Fair value is measured by use
of an option pricing model.

Key Accounting Estimates and Judgements
The preparation of ﬁnancial information in conformity with IFRS requires the use of estimates and assumptions
that aﬀect the reported amounts of assets and liabilities at the date of ﬁnancial information and the reported
amounts of expenses during the reporting periods. Although these estimates are based on management’s best
knowledge of the amounts, event or actions, actual results ultimately may diﬀer from those estimates. The key
accounting estimates and judgements are set out below:

(a) Carrying value of mineral properties and development costs

The Savannah Resources Group assesses at each reporting period whether there is any indication that
these assets may be impaired. If such indication exists, the Group estimates the recoverable amount of
the asset. In the early stages of exploration an indication of impairment may arise from drilling and assay
results or from management’s decision to terminate the project. The recoverable amount is assessed by
reference to the higher of ‘value in use’, where a project is still expected to be developed into production
(being the new present value of expected future cash ﬂows of the relevant cash generating unit) and ‘fair
value less cost to sell’. Further details are set out in Note 11.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES continued

(b) Exploration and evaluation costs

The Savannah Resources Group has to apply judgement in determining whether exploration and evaluation
expenditure should be capitalised within intangible assets as exploration and evaluation costs or expensed.
The Savannah Resources Group has a policy of capitalising all exploration and evaluation costs (as set out
above).  Management  therefore  exercises  judgement  based  on  the  results  of  economic  evaluations,
prefeasibility or feasibility studies in determining whether it is appropriate to continue to carry these costs
as an intangible asset or whether they should be impaired. The total value of exploration and evaluation
costs capitalised as at each of the reporting dates is set out in Note 11.

(c) Share-based payments

In determining the fair value of share-based payments made during the period, a number of assumptions
have been made by management. The details of these assumptions are set out in Note 24.

(d)

Investment in Alecto Minerals plc
The Directors have had to apply judgment in considering the accounting treatment of the Company’s
investment in Alecto Minerals plc (‘Alecto’) with reference to its relationship with Alecto. Although during
the year the Company held between 15.7% and 21.1% of Alecto’s shares, it is the Directors’ opinion that
the investment in Alecto should be treated as an investment in the accounts of Savannah rather than as an
associate on the basis that Savannah does not have the power to exert signiﬁcant inﬂuence over Alecto.
Key factors behind the opinion of the Directors include:

•

•

•

•

•

•

Proportion of shareholding;

Inﬂuence of other shareholders;

Board representation and inﬂuence over decision-making;

The presence of any special voting rights;

Transactions between the companies;

Inter-change of managerial personnel.

Accounting Developments During 2014
The International Accounting Standards Board (IASB) has issued the following new standards, amendments to
published standards and interpretations to existing standards with eﬀective dates on or prior to 1 January 2014
which have been adopted by the Group for the ﬁrst time this year and which have not had a material eﬀect.
The new standards and amendments relevant to the Group have been disclosed below:

Eﬀective period 
commencing on or after

Impact on Group

Amendment to IAS 32 Oﬀsetting Financial Assets and 
Financial Liabilities
Amendment to IAS 36 Impairment of Assets – Recoverable 
Amount Disclosures for Non-Financial Assets
Amendments to IFRS 10, IFRS 12 and IAS 27 – Investment
Entities

1 January 2014

No material impact

1 January 2014

No material impact

1 January 2014

No material impact

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES continued

Accounting Developments Not Yet Adopted
Various new standards and amendments have been issued by the IASB up to the date of this report which are
not applicable until future periods and some have not yet been endorsed by the European Union. The Directors
do not expect these will have a material impact on the Financial Statements of the Group or Company. 

2. SEGMENTAL REPORTING

The Group complies with IFRS 8 Operating Segments, which requires operating segments to be identiﬁed on
the basis of internal reports about components of the Group that are regularly reviewed by the chief operating
decision maker, which the Company considers to be the Board of Directors. In the opinion of the Directors, the
operations of the Group comprise of exploration in Oman, exploration in Mali (discontinued), exploration in
Mozambique,  headquarter  administration  and  corporate  costs  and  the  Company’s  investments  in  Alecto
Minerals Plc (“Alecto”). 

Based on the Group’s current stage of development there are no revenues associated to the segments detailed
below. For exploration in Oman, Mali and Mozambique the segments are calculated by the summation of the
balances in the legal entities which are readily identiﬁable to each of the segmental activities. In the case of
the Investment in Alecto, this is calculated by analysis of the speciﬁc related investment instruments. Inter-
Company loans are eliminated to zero and not included in each segment below.

Oman
Copper
£

Exploration
in Mali
£

Mozam- Headquarter
bique administration
and
corporate
£

Mineral
Sands
£

Investment 
in
Alecto
£

Elimination
£

Total
£

–
–
238

274,723
(177,694)
4,153

–
(314,157)
13,976

(274,723)
–
–

–
(491,851)
18,367

2014
Revenue
Finance costs
Interest income
Depreciation and 
amortisation
Loss on disposal 
of subsidiaries
(Loss)/proﬁt for 
the period
Total assets
Total non-
current assets
Additions to 
non-current 
assets
Total current 
assets
Total liabilities

–
–
–

–

–

–
–
–

–

–
–

–

(3,784)

–

(1,568)

–

(134,315)
1,043,846

(126,152)
1,097,749

(1,356,542)
1,740,755

(300,181)
1,129,602

954,349

1,067,072

–

904,696

11,337

588,133

7,489

101,067
(83,839)

–
–

66,497
(18,767)

1,693,364
(154,531)

1,129,602
–

–

–

–

–

–

–
–

–

–

–
–

(3,784)

(1,568)

(1,917,190)
5,011,952

2,021,421

1,511,655

2,990,530
(257,137)

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2. SEGMENTAL REPORTING continued

Headquarter

2013

Exploration Mozambique administration Investment in 
Alecto
£

in Mali Mineral Sands and corporate
£

£

£

Depreciation and amortisation
Proﬁt on disposal of subsidiaries
Impairment of intangibles
(Loss)/proﬁt for the period
Total assets
Total non-current assets
Additions to non-current assets
Total current assets
Total liabilities

(27,321)
180,048
(1,362,402)
(1,377,175)
251,010
250,000
384,000
1,010
(5,366)

–
–
–
(18,490)
453,577
448,983
447,018
4,593
(188,839)

(2,910)
–
–
(869,458)
965,380
3,153
–
962,228
(125,687)

–
–
–
223,380
3,403,815
2,830,435
2,830,435
573,380
–

3. EMPLOYEES AND DIRECTORS

The average monthly number of employees during the year was as follows:

Operational
Non-operational

Staﬀ Costs (excluding Directors)

Salaries
Social security
Share based payment expense (see Note 24)
Severance

2014
No

8
8

16

2014
£

328,684
24,175
47,816
–

400,675

Total
£

(30,231)
180,048
(1,362,402)
(2,041,743)
5,073,782
3,532,571
3,661,453
1,541,211
(319,892)

2013
No

15
8

23

2013
£

296,863
65,405
16,310
7,241

385,819

The numbers in the above table includes £242,460 (2013: £111,732) which was capitalised as an intangible
asset.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

3. EMPLOYEES AND DIRECTORS continued

Directors’ Remuneration

Salaries
Social security
Share based payment expense (see note 24)

2014
£

219,278
18,841
74,425

312,544

2013
£

270,433
5,233
115,992

391,658

The numbers in the above table includes £18,643 (2013: Nil) of Directors’ Remuneration which was capitalised
as an intangible asset in relation to the provision of speciﬁc technical services.

The Directors are considered to be the key management of the Group. Details of Directors’ remuneration and
the highest paid Director are disclosed in the Report of the Directors. No Directors accrued pension beneﬁts
during any of the periods presented. 

4.

(LOSS)/PROFIT ON DISPOSAL OF SUBSIDIARIES

Consideration 
Net assets disposed

2014
£

2013
£

250,000
(251,568)

1,250,000
(1,069,952)

(1,568)

180,048

On 27 March 2014 the Company sold to Alecto its subsidiary, NewMines Holdings Limited, which, through its
wholly owned subsidiary Tobon Tondo, holds the exploration rights to the Karan and Diatissan gold projects in
Mali. The consideration payable of £250,000 was satisﬁed by the issue of 20,000,000 ordinary shares in Alecto
(see Note 13).

In August 2013 the Group disposed of its investment in AME West Africa Limited and its’ subsidiary Caracal
Gold S.A.R.L to Alecto Minerals plc (“Alecto”) for £1,250,000 worth of shares in Alecto (see Note 13).

The net assets at the date of disposal comprised: 

Intangible assets
Tangible assets
Receivables
Cash
Payables

2014
£

250,783
–
785
–
–

251,568

2013
£

910,190
148,643
6,162
21,653
(16,696)

1,069,952

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

5. FINANCE INCOME

Deposit account interest
Interest on convertible loan notes
Movement on the valuation of derivative

2014
£

4,842
13,976
–

18,818

2013
£

5,053
45,196
178,184

228,433

The convertible loan notes are detailed in Note 14. The interest accruing on the loan notes is reﬂected above.

FINANCE COSTS

Bank charges
Alecto derivative valuation and loan accretion
Movement on the valuation of Bergen derivative

2014
£

2,769
314,517
174,565

491,851

2013
£

–

–

–

The movement in the value of the derivative at fair value at the reporting date are reﬂected above.

6. LOSS BEFORE INCOME TAX

The loss before income tax is stated after charging

Depreciation and amortisation
Auditors’ remuneration:
– Statutory audit of the Group Financial Statements
– Other assurance services 
– Tax advice
Foreign exchange diﬀerences
Operating lease payments
Share based payments

2014
£

2013
£

3,784

30,231

26,500
5,000
32,950
11,267
49,541
122,242

24,973
4,027
1,400
3,110
54,244
132,301

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

7.

INCOME TAX
Analysis of the Tax Charge
No liability to UK corporation tax arose on ordinary activities for the year ended 31 December 2014 nor for the
year ended 31 December 2013. 

Factors Aﬀecting the Tax Charge
The reasons for the diﬀerence between the actual tax charge for the year and the standard rate of corporation
tax in the United Kingdom applied to the result for the year are as follows: 

2014
£

2013
£

Loss on ordinary activities before tax

(1,917,190)

(2,041,743)

Loss on ordinary activities multiplied by the standard rate
of corporation tax in the UK of 21% (2013 – 23%)

Eﬀects of:
Expenses not deductible for tax purposes
Tax losses carried forward

Total income tax

(402,610)

(469,601)

64,444
338,166

–

340,998
128,603

–

Deferred Tax
The Group has carried forward losses amounting to £3,397,055 as at 31 December 2014 (2013: £2,312,420).
As the timing and extent of taxable proﬁts are uncertain, the deferred tax asset arising on these losses has not
been recognised in the Financial Statements.

8. CASH FLOWS FROM DISCONTINUED OPERATIONS

The Company made the decision to divest NewMines Holding Limited and as such the assets within NewMines
Holding Limited were disposed of on 27 March 2014 as detailed in Note 4.

AME West Africa Limited and its subsidiary, Caracal Gold Mali SARL, were disposed of during the year ended
31 December 2013 as detailed in Note 4.

Group cash ﬂows from discontinued operations

Operating cash ﬂows
Investing cash ﬂows
Financing cash ﬂows

Total cash ﬂows

Group

2013
£

310,960
(338,373)
–

(27,413)

2014
£

–
–
–

–

Company

2014
£

2013
£

–
–
–

–

–
–
–

–

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

8. CASH FLOWS FROM DISCONTINUED OPERATIONS continued

Analysis of the result of discontinued operations 

Revenue
Expenses
Impairment
(Loss)/Proﬁt on disposal of subsidiaries (Note 4)

Loss before tax of discontinued operations
Tax

Loss after tax of discontinued operations

Group

Company

2014
£

–
–
–
(1,568)

(1,568)
–

(1,568)

2013
£

–
(182,246)
(1,362,402)*
180,048

(1,364,600)
–

(1,364,600)

2014
£

–
–
–
41,753

41,753
–

41,753

2013
£

–
–

(1,362,402)*

–

(1,362,402)
–

(1,362,402)

* The Directors reviewed the carrying value of the intangible assets and have included an impairment charge of nil (2013:
£1,362,402). The impairment in the 2013 ﬁnancial year (see note 11) was against the carrying value of the Karan and Diatissan
licences. The impairment charge has been restated based on the £250,000 consideration received in the sale of New Mines
Holdings Limited and Tobon Tondo S.U.A.R.L. 

9. LOSS OF PARENT COMPANY

As permitted by Section 408 of the Companies Act 2006, the proﬁt and loss account of the parent Company is
not presented as part of these Financial Statements. The parent Company’s loss for the ﬁnancial year was
£3,811,407 (2013: £627,716). 

10. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the period.

Diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the
conversion of all dilutive potential ordinary shares.

In accordance with IAS 33 as the Group is reporting a loss for both this and the preceding year the share options,
warrant options and warrants are not considered dilutive because the exercise of share options would have
the eﬀect of reducing the loss per share.

Reconciliations are set out below.

Basic Loss Per Share
Losses attributable to ordinary shareholders:
Total loss for the year
Continuing operations
Discontinued operations
Weighted average number of shares
Loss per share – total loss for the year
Loss per share – continuing operations
Loss per share – discontinued operations

2014
£

2013
£

(1,917,190)
(1,917,190)
–
167,870,908
0.0114
0.0114
–

(2,041,743)
(677,143)
(1,364,600)
100,004,746
0.0204
0.0068
0.0136

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

11. INTANGIBLE ASSETS (Group)

Cost
At 1 January 2013
Additions
Transfers from tangible assets
Disposals (Note 4)
Exchange diﬀerences

At 1 January 2014
Additions
Disposals (Note 4)
Exchange diﬀerences

At 31 December 2014

Amortisation and impairment
At 1 January 2013
Impairment charge for the year from discontinued operations
Amortisation charge for the year
Exchange diﬀerences

At 1 January 2014
Amortisation charge for the year
Eliminated on disposal
Exchange diﬀerences

At 31 December 2014

Net Book Value
At 31 December 2014

At 31 December 2013

Exploration 
and evaluation 
£

2,080,604
824,638
11,904
(928,667)
47,430

2,035,909
1,473,922
(1,572,679)
36,975

1,974,128

–
1,362,402
–
(22,478)

1,339,924
–
(1,318,299)
(21,625)

Other
£

11,640
–
–
–
–

11,640
–
–
–

11,640

5,577
–
2,910
–

8,487
3,153
–
–

Total
£

2,092,244
824,638
11,904
(928,667)
47,430

2,047,550
1,473,922
(1,572,679)
36,975

1,985,768

5,577
1,362,402
2,910
(22,478)

1,348,411
3,153
(1,318,299)
(21,625)

–

11,640

11,640

1,974,128

695,985

–

1,974,128

3,153

699,138

The exploration and evaluation assets referred to in the table above comprise expenditure in relation to
exploration licences in the Republic of Mali, Oman and Mozambique. The Directors consider that for the
purposes  of  assessing  impairment,  the  above  exploration  and  evaluation  expenditure  is  allocated  to  the
following licence areas, representing the Group’s Cash Generating Units (“CGUs”).

Karan and Diatissan (Mali)
Jangamo (Mozambique)
Blocks 4, 5 and 6 (Oman)

2014
£

–
1,047,382
926,746

1,974,128

2013
£

250,000
445,985
–

695,985

The Directors have reviewed the carrying value of the intangible assets and have included an impairment charge
of nil (2013: £1,362,402). The impairment in the 2013 ﬁnancial year (see Note 8) was against the carrying value
of the Karan and Diatissan licences. The impairment charge was calculated based on the £250,000 consideration
received in the sale of New Mines Holdings Limited and Tobon Tondo S.U.A.R.L. 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

11. INTANGIBLE ASSETS (Group) continued

The Directors consider that the remaining carrying value of the intangible assets is not impaired based on an
assessment of the recoverable amount of each of the Group’s CGUs.

INTANGIBLE ASSETS (Company)

Cost
At 1 January 2013
Additions

At 1 January 2014
Additions

At 31 December 2014

Amortisation
At 1 January 2013
Charge for the year

At 1 January 2014
Charge for the year

At 31 December 2014

Net Book Value
At 31 December 2014

At 31 December 2013

Total
£

11,640
–

11,640
47,391

59,031

5,577
2,910

8,487
3,153

11,640

47,391

3,153

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

12. PROPERTY, PLANT AND EQUIPMENT (Group)

Cost
At 1 January 2013
Additions
Transfers to intangible assets
Disposals (Note 4)
Exchange diﬀerences

At 1 January 2014
Additions
Exchange diﬀerences

At 31 December 2014

Depreciation
At 1 January 2013
Charge for year
Disposals (Note 4)
Exchange diﬀerences

At 1 January 2014
Charge for year
Exchange diﬀerences

At 31 December 2013

Net Book Value
At 31 December 2014

At 31 December 2013

13. INVESTMENTS

Listed Investments in Alecto
Group 
Non Current

At 1 January 2014
Additions at cost
Conversion of loan note
Change in market value of investment
Transfer to Current

At 31 December 2014
Current
At 1 January 2014
Transfer from Non Current

At 31 December 2014

Plant and
machinery
£

Motor
vehicles
£

Oﬃce 
Equipment
£

173,202
6,380
(11,904)
(174,332)
6,654

–
–
–

–

27,598
19,882
(46,238)
(1,242)

–
–
–

–

–

–

–

53,832
–
–
(55,900)
2,068

–
27,505
1,578

29,083

24,092
6,797
(34,116)
3,227

–
2,149
123

2,272

–

26,811

–

6,954
–
–
(7,221)
267

–
10,228
556

10,784

5,124
642
(5,962)
196

–
6,951
399

7,350

–

3,434

–

Total
£

233,988
6,380
(11,904)
(237,453)
8,989

–
37,733
2,134

39,867

56,814
27,321
(86,316)
2,181

–
9,100
522

9,622

–

30,245

–

Quantity of
shares held

Share Price
£

% of Alecto
Issued Share
Capital

Listed
investments
£

121,739,130
20,000,000
32,045,742
–

0.02325
0.01250
0.0085
–

14.8%
2.4%
3.9%
–

–

–

–

173,784,872

0.0065

19.58%

2,830,435
250,000
272,389
(2,223,222)
(1,129,602)

–

–
1,129,602

1,129,602

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

13. INVESTMENTS continued

The Investment in Alecto has been classiﬁed as current at 31 December 2014 as the lock-in period expired on
4  October  2014  and  the  Group  has  entered  a  12  month  orderly  market  period  for  128,695,652  of  the
173,784,872 shares held at that date, with the balance being freely tradeable.

In August 2013 the Group announced the conditional agreement to divest its subsidiary, AME West Africa
Limited to Alecto Minerals Plc (“Alecto”). Included within the opening balance above is £1,250,000 in respect
of 108,695,652 shares acquired in Alecto in respect of this divestment and a share subscription of 13,043,478
shares in Alecto for £150,000. The change in market value represents the fair value of shares held at the
reporting date less the cost. The fair value of the shares being the market value of the Alecto shares at the
reporting date of 31 December 2014.

On 27 March 2014 the Company sold to Alecto its subsidiary, NewMines Holdings Limited, which, through its
wholly owned subsidiary Tobon Tondo, holds the exploration rights to the Karan and Diatissan gold projects in
Mali. The consideration payable of £250,000 was satisﬁed by the issue of 20,000,000 ordinary shares in Alecto
which was considered to be its value.

On 27 July 2014 the Unsecured Loan Note (“Convertible Loan”) in Alecto Minerals Plc (“Alecto”) has been
converted into 30,434,783 ordinary shares in Alecto (“Shares”). As prescribed by the terms of the Convertible
Loan entered into in October 2013 in relation to the disposal of AME West Africa Ltd to Alecto, the £350,000
Convertible Loan has been converted at a ﬁxed rate of £0.0115 per ordinary Share. The market value at the
date of conversion was £0.0085 per Share. Additionally 1,610,959 Shares have been issued in satisfaction of
the £18,831 interest earned on the Convertible Loan. Following the issue of the resulting 32,045,742 Shares,
the Company’s shareholding in Alecto will be 173,784,872 Shares acquired. 

Company

Non Current
At 1 January 2014
Additions
Conversion of loan note
Change in market value of investment
Disposals
Transfer to Current

At 31 December 2014

Current
At 1 January 2014
Transfer from Non Current

At 31 December 2014

Shares in Group 
undertakings
& listed 
investments
£

2,956,562
250,081
272,389
(2,223,222)
(125,927)
(1,129,602)

281

–
1,129,602

1,129,602

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

13. INVESTMENTS continued

In September 2013 the Group entered into an agreement to acquire 80% of the share capital of Matilda Minerals
Lda (“Matilda”), the owner of a mineral sands exploration project in a world class mineral sands province in
Mozambique. In respect of the remaining 20% shareholding in Matilda Minerals Plc, this will be free carried at
the Company’s cost until the point of decision to carry out a Deﬁnitive Feasibility Study. When this point is
reached the 20% shareholder can either: (a) contribute in proportion to its shareholding at that time; (b) become
diluted in accordance with a pre-determined methodology; or (c) sell its shareholding pro rata to the Project
value. The investment in Matilda has been accounted for as an asset acquisition and is included in intangible
assets in Note 11.

A new 100% subsidiary Company, Savannah Resources B.V. was set up to be the immediate parent Company of
Gentor Resources Inc. with an initial investment of €100 (~£81) in the ordinary share capital. On 10 April 2014
the  Company  entered  into  an  agreement  to  acquire  100%  of  Gentor  Resources  Inc.’s  subsidiary,  Gentor
Resources Limited (“GRL”) through a the subsidiary, Savannah Resources B.V., which in turn acquired interests
in Al Fairuz, Gentor Resources LLC, and Al Zuhra. 

Gentor Resources Limited has a 65% interest in Al Fairuz (Block 5) and the right to earn up to a 70% interest in
Al Zuhra (Block 6) exploration licences in Oman. 

In  consideration  for  acquiring  100%  of  the  issued  share  capital  of  GRL,  the  Company  initially  paid  cash
consideration of USD 800,000. Additionally milestone payments, to be satisﬁed (up to 50% payable in ordinary
shares  in  the  Company)  as  follows:  (a)  USD  1,000,000  upon  a  formal  ﬁnal  investment  decision  for  the
development of the Block 5 Licence; (b) USD 1,000,000 upon the production of the ﬁrst saleable concentrate
or saleable product from ore derived from the Block 5 Licence; (c) USD 1,000,000 within six months of the
payment of the Deferred Consideration in (b). The Company will be responsible for all of the funding of the
projects. This funding will be in the form of loans which would be reimbursed prior to any dividend distribution
to shareholders.

In November 2014 the Group entered into an earn-in agreement (“Earn-in”) to acquire up to a 65% interest in
Al Thuraya LLC (“Al Thuraya”) which wholly owns the highly prospective Block 4 Copper Project in Oman. In
order  for  the  Group  to  achieve  a  51%  shareholding  in  Al  Thuraya,  they  are  required  to  make  a  capital
contribution  of  US$2,000,000  (~GBP  £1,287,500)  within  two  years  and  a  further  US$2,600,000  (~GBP
£1,674,000) cash within four years to receive a further 14% shareholding in Al Thuraya. These funds will be
used for exploration activities.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

13. INVESTMENTS continued

The Company had the following subsidiary undertakings, either directly or indirectly, at 31 December 2014,
which have been included in the Consolidated Financial Statements.

Subsidiary

AME East Africa Limited
Matilda Minerals Limitada
Panda Recursos Limitada
Savannah Resources B.V.
Gentor Resources Limited
Al Fairuz Mining Co L.L.C.
Gentor Resources L.L.C.
Al Zuhra Mining L.L.C.
Al Thuraya Mining L.L.C.
African Mining & Exploration 
Limited

Country of 
Incorporation

Nature of business

Mining & exploration
Mining & exploration

United Kingdom Holding Company
Mozambique
Mozambique
The Netherlands Holding Company
Holding Company
British Virgin Is.
Mining & exploration
Oman
Dormant
Oman
Mining & exploration
Oman
Mining & exploration
Oman

Class of 
share

Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary

% Holding

100%
80%3
99.99%
100%
100%
65%3
70%3
40%1, 3
0%2, 3

United Kingdom Dormant

Ordinary

100%

1 The Group has legal rights to 40% of equity holding, oﬃcial registration of the ownership is pending.

2 Al Thuraya has been consolidated at 31 December 2014 as the Group has controlling rights to the Project via
the Earn-in.

3 These entities have been consolidated 100% despite the Group owing less than 100% of the voting rights.
This is due to the Company having Earn-in contracts whereby the Company is the only contributing party and
has the ability to control the operations. 

14. LOAN RECEIVABLES

Loan
Derivative

Group

Company

2014
£

–
–

–

2013
£

228,474
344,906

573,380

2014
£

–
–

–

2013
£

228,474
344,906

573,380

The loans receivable above relate to the purchase of convertible loan notes in Alecto Minerals Plc. The loan
was converted in July 2014 into Alecto’s shares at a ﬁxed price of 1.15 pence through the issue of 30,434,783
ordinary Alecto shares, refer to note 13. This derivative has been recognised at fair value using the Black Scholes
valuation technique. 

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15. TRADE AND OTHER RECEIVABLES

Non-Current: 
Other receivables
Amounts due from subsidiaries

Current:
VAT recoverable
Other receivables

16. CASH AND CASH EQUIVALENTS

Group

2013
£

2,998
–

2,998

31,449
76,766

108,215

2014
£

17,049
–

17,049

46,331
36,259

82,590

Company

2014
£

2013
£

–
2,301,121

2,301,121

46,331
12,663

58,994

-
310,354

310,354

30,630
76,595

107,225

Group

2014
£

2013
£

Company

2014
£

2013
£

Cash at bank and in hand

1,778,338

859,616

1,634,371

855,023

17. LOAN PAYABLES

The Company issued an Unsecured Convertible Instrument to Bergen on 10 April 2014 with a nominal value of
US$400,000 (£237,925 at date of issue), which was convertible at Bergen’s election into ordinary shares in the
Company (the “Convertible Security”). The relevant conversion price is the lesser of (a) 91% of the average of
ﬁve daily volume-weighted average prices of the Company’s shares on AIM during a speciﬁed period preceding
the date of the conversion of the Convertible Security and (b) 135% of the average of the daily volume-weighted
average prices of the Company’s shares for the 20 consecutive trading days preceding 10 April 2014. This
Convertible Instrument was fair valued using the Black-Scholes valuation technique. In November 2014 the
Convertible Security was exercised by Bergen. There are no loans payable as at 31 December 2014.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

18. SHARE CAPITAL

Allotted, issued and fully paid

At beginning of year
Issued during year:
Cash subscription by 
David Archer (Director)
Share placement
Bergen ﬁnancing arrangement
Acquisition of 80% of 
Matilda Minerals Lda
In lieu of notice
In lieu of cash for professional services1

2014

2013

£0.01
ordinary
shares
number

£0.01
ordinary
shares
number

£

£

138,365,781

1,383,658

84,213,306 

842,133

–
55,173,104
26,244,600

–
–
3,386,229

–
551,731
262,446

–
–
33,862

22,222,224
18,047,748

222,222
180,478

10,643,107
2,666,667
572,729 

106,431
26,667
5,727 

At end of year

223,169,714

2,231,697

138,365,781 

1,383,658 

1 The shares issued in lieu of cash for professional services were valued at the fair value of the services received,
£132,393 has been recorded in share premium for these transactions.

The par value of the Company’s shares is £0.01

Refer to Note 24 for details of warrants and options issued.

19. TRADE AND OTHER PAYABLES

Current: 
Trade payables
Other payables
Accruals and deferred income

Group

2014
£

2013
£

100,813
15,969
140,356

257,138

172,307
8,635
138,950

319,892

Company

2014
£

71,111
11,738
74,084

2013
£

78,224
3,916
38,065

156,933

120,205

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20. FINANCIAL INSTRUMENTS

Financial Instruments - Risk Management
In  common  with  all  other  businesses,  the  Group  is  exposed  to  risks  that  arise  from  its  use  of  ﬁnancial
instruments. This note describes the Group’s objectives, policies and processes for managing those risks and
the methods used to measure them. Further quantitative information in respect of these risks is presented
throughout these Financial Statements.

There have been no substantive changes in the Group’s exposure to ﬁnancial instrument risks, its objectives,
policies and processes for managing those risks or the methods used to measure them from previous periods
unless otherwise stated in this note.

Principal Financial Instruments
The principal ﬁnancial instruments used by the Group, from which ﬁnancial instrument risk arises, are as follows:

•

•

•

•

•

•

loan receivables

trade and other receivables

derivatives – equity conversion option in receivables/payables convertible to share capital

cash at bank

trade and other payables

investments

Trade and other payables fall due for payment within 3 months from the reporting date.

Liquidity Risk
The Group has suﬃcient funding in place to meet its operational commitments and is not exposed to any
liquidity risk but in common with many exploration companies, the Company is likely to need to raise funds for
its exploration activities. The Group’s policy continues to be to ensure that it has adequate liquidity by careful
management of its working capital. The Board receives rolling 18-month cash ﬂow projections on a regular
basis as well as information regarding cash balances. At the reporting date, these projections indicated that
the Group expected to have suﬃcient liquid resources to meet its current obligations under all reasonably
expected circumstances. 

Foreign Exchange Risk
The Group is exposed through its operations to foreign exchange risk which arises because the Group has
overseas operations located in Mozambique whose functional currency is MZN and in Oman whose functional
currency is OMR which is pegged to the USD. The Group’s net assets arising from overseas operations are
exposed to currency risk resulting in gains or losses on retranslation into Pound Sterling.

Foreign exchange risk also arises when individual Group entities enter into transactions denominated in a
currency other than their functional currency. The Group’s policy is, where possible, to allow Group entities to
settle liabilities denominated in their functional currency (Euro, OMR, MZN or Pound Sterling) with the cash
remitted to their own operations in that currency. Where Group entities have liabilities denominated in a
currency other than their functional currency (and have insuﬃcient reserves of that currency to settle them)
cash already denominated in that currency will, where possible, be transferred from elsewhere within the
Group. To mitigate the risk of the CFA / Euro expenditure in Oman, the Group holds cash in a Euro denominated
bank account, suﬃcient to meet committed expenditure and other liabilities. The OMR is pegged to the USD
at a rate of 1 OMR to 2.6 USD. To further mitigate foreign exchange risk, larger contracts in Mozambique are
denominated in USD.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20. FINANCIAL INSTRUMENTS continued

Market Risk
The Group holds an equity investment in Alecto (see Note 13). The Directors believe that the exposure to market
price risk from this activity is acceptable in the Group’s circumstances. 

The eﬀect of a 10% increase in the value of the equity investments held at the reporting date would, all other
variables held constant, have resulted in an increase in other comprehensive income and net assets of £112,960
(2013: £283,043). A 10% decrease in their value would, on the same basis, have decreased other comprehensive
income and net assets by the same amount.

Credit Risk
The Company is exposed to credit risk on its’ receivables from its subsidiaries. The subsidiaries are exploration
companies with no current revenue and therefore, whilst the receivables are due on demand, they are not
expected to be paid until there is a successful outcome on an exploration project resulting in revenue being
generated by a subsidiary.

Fair Value
Derivatives are measured at fair value and relate to assets traded in an active market. Fair values are determined
using the quoted share price and applying the Black-Scholes valuation methodology. 

The fair values of derivatives as at 31 December 2014 were as follows:

Financial instrument

Loan Receivable Derivative – equity 
conversion option within a receivable 
convertible to share capital. 

Loan Payable Derivative – equity 
conversion option within a payable 
convertible to share capital. 

Revaluation 
gains/
(losses)  Measurement 
methodology

£

Fair value
£

–

–

(314,517) Based on share 
price using
Black-Scholes 
model

(174,565) Based on share 
price using
Black-Scholes 
model

The fair values of derivatives as at 31 December 2013 were as follows:

Financial instrument
Loan Receivable Derivative – equity
conversion option within a receivable 
convertible to share capital. 

Fair value
£
344,906

Revaluation 
gains/
(losses)  Measurement 
methodology
Based on 
price using
Black- Scholes
model

£
178,184

The  level  of  the  fair  value  hierarchy  within  the  measurement  is  categorised  as  Level  2  and  there  are  no
unobservable inputs within the measurement. There were no transfers between Level 1 and Level 2 for the
year.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20. FINANCIAL INSTRUMENTS continued

The loan receivable derivative valuation has been calculated using a Black-Scholes Model. The valuation at
conversion for 2014 and at year end for 2013 has been calculated using the following parameters:

Stock asset price (£)
Option strike price (£)
Maturity (years)
Risk-Free interest rate
Volatility

2014
£

0.0085
0.012
0.2
2.5%
100%

2013
£

0.023
0.012
0.75
2.5%
100%

The loan payable derivative valuation at conversion has been calculated using a Black-Scholes Model and using
the following parameters:

Stock asset price (£)
Option strike price (£)
Maturity (years)
Risk-Free interest rate
Volatility

Financial instruments by category (Group)

As at 31 December 2014

Investment in Alecto
Cash and cash equivalents

At 31 December 2013
Investment in Alecto
Loan receivables
Derivative
Cash and cash equivalents

2014
£

0.6
0.36
2.6
2.5%
64%

2013
£

–
–
–
–
–

Assets at fair 
Loans and value through
receivables proﬁt and loss
£
–
–

£
–
1,778,338

1,778,338

–

–
228,474
–
859,616

1,088,090

–
–
344,906
–

344,906

Available
for sale
£
1,129,602
–

1,129,602

2,830,435
–
–
–

2,830,435

Total
£
1,129,602
1,778,338

2,907,940

2,830,435
228,474
344,906
859,616

4,263,431

Available for sale assets are measured at fair value. The fair value hierarchy is level 1 as the valuation is based
wholly on quoted prices. There were no transfers between level 1 and level 2 for the current year.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20. FINANCIAL INSTRUMENTS continued

Financial instruments by category (Group) Continued
As at 31 December 2014

Trade and other payables

At 31 December 2013
Trade and other payables

Financial 
liabilities at 
amortised cost
£

Total
£

257,138

257,138

319,892

319,892

As at 31 December 2014 and 31 December 2013, the currency exposure of the Group was as follows:

At 31 December 2014

GBP
£

USD
£

AUD
£

OMR
£

MZN
£

Total
£

Other
£

Cash and cash 
equivalents
1,166,120
Trade and other payables 130,197

At 31 December 2013
Cash and cash equivalents 852,299
573,3800
Loan receivables
206,674
Trade and other payables

483,480
25,871

–
49,314

83,758
43,080

44,980
8,675

– 1,778,338
257,137
–

–
–
–

–
–
–

–
–
–

4,593
–
107,852

2,724
–
5,366

859,616
573,380
319,892

Capital Disclosures
The Group’s objectives when maintaining capital are:

–

–

to safeguard the entity’s ability to continue as a going concern, so that it can continue to provide returns
for shareholders and beneﬁts for other stakeholders, and

to provide an adequate return to shareholders by pricing products and services commensurately with the
level of risk.

The Company currently does not have any debt.

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235402 Savannah p25-p53  26/02/2015  15:58  Page 48

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

21. CONTINGENT LIABILITIES

Details of contingent liabilities where the probability of future payments is not considered remote are set out
below, as well as details of contingent liabilities, which although considered remote, the Directors consider
should be disclosed. The Directors are of the opinion that provisions are not required in respect of these matters,
as it is not probable that a future sacriﬁce of economic beneﬁts will be required or the amount is not capable
of reliable measurement. 

Deferred consideration payable in relation to the acquisition of 80% shareholding in Matilda Minerals Lda
In consideration for acquiring 80% shareholding in Matilda Minerals Lda, the Company paid initial consideration
of  AUD$400,000  (~GBP  £210,000)  in  ordinary  shares  and  a  cash  payment  for  cost  reimbursements  of
AUD$125,000 (~GBP £66,000). Additionally milestone payments, to be satisﬁed by the issue of ordinary shares
in the Company are payable as follows: (a) AUD$500,000 (~GBP £263,000) upon the establishment of a JORC
Inferred Resource of 150Mt @ 3% THM; (b) AUD$500,000 (~GBP £263,000) upon the establishment of a JORC
Indicated Resource of 350Mt @ 3% THM; (c) AUD$500,000 (~GBP £263,000) upon the establishment of a JORC
Indicated Resource of 500Mt @ 3% THM.

Deferred consideration payable in relation to the acquisition of Oman Copper
On 15 July 2014 the Company completed the acquisition of interests in the highly prospective Block 5 and Block
6 copper projects in the Semail Ophiolite belt in the Sultanate of Oman from the TSX-Venture listed Gentor
Resources Inc. The Company paid initial consideration of USD $800,000 (~GBP £515,000) with the following
deferred consideration required to complete the acquisition of 100% of the issued share capital of Gentor
Resources Ltd (“GRL”):

1.  Deferred Consideration (up to 50% payable in Savannah shares)

(a)  a milestone payment of USD $1,000,000 (~GBP £644,000) upon a formal ﬁnal investment decision for the

development of the Block 5 Licence;

(b)  a  milestone  payment  of  USD  $1,000,000  (~GBP  £643,750)  upon  the  production  of  the  ﬁrst  saleable

concentrate or saleable product from ore derived from the Block 5 Licence; and

(c)  a milestone payment of USD $1,000,000 (~GBP £643,750) within six months of the payment of the Deferred

Consideration in (b).

2.  Other Information

(a)  the Company will be responsible for all of the funding of the projects. This funding will be in the form of a

loan which would be reimbursed prior to any dividend distribution to shareholders; and

(b)  the Company is expected to spend approximately GBP £600,000 on exploration in the ﬁrst 12 months of

owning GRL.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

22. RELATED PARTY DISCLOSURES

Details of Director’s remuneration are disclosed in note 3. During the year £62,545 (2013: £25,614) was payable
to  Blue  Bone  Consulting  Pty  Ltd  (a  Company  controlled  by  Dale  Ferguson)  for  consultancy  fees  of  which
£5,632(2013: £nil) remained unpaid. In 2013 £141,286 was payable to J Cubed Ventures Ltd (a Company
controlled by former Director Mark Jones) for consultancy fees, no fees were payable in 2014. The amounts
payable  to  Blue  Bone  Consulting  Pty  Ltd  and  J  Cubed  Ventures  Ltd  have  been  included  in  the  Directors’
remuneration in note 3.

During the year £18,038 (2013: Nil) was payable to Arlington Group Asset Management (a Company which
Charlie Cannon-Brookes is a Director and Shareholder) for the provision of a serviced oﬃce. No amounts remain
unpaid. During the year £1,750 (2013: Nil) was payable to Lautner Group Limited (a Company which David
Archer’s close family member is a Director) for the provision of oﬃce support. No amounts remain unpaid.

These transactions were entered into on an arms-length basis.

23. COMMITMENTS

Operating Lease Commitments
No later than 1 year
Later than 1 year and no later than 5 years
Later than 5 years

2014
£

30,372
–
–

30,372

2013
£

30,215
12,292
–

42,507

The operating lease commitments are for business premises in the United Kingdom, Mozambique and Oman.

Other Commitments
As announced on 18 November 2014 the Group entered into an agreement to acquire Al Thuraya LLC (“Al
Thuraya”), owner of the highly prospective Block 4 Copper Project. In order for the Group to achieve a 51%
shareholding in Al Thuraya, the Company is required to make an initial contribution of US$400,000 (~GBP
£257,500),  a  capital  contribution  of  US$1,600,000  (~GBP  £1,030,000)  within  two  years  and  a  further
US$2,600,000 (~GBP £1,674,000) cash contribution within four years to receive a further 14% shareholding in
Al Thuraya. These funds will be used for exploration activities.

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235402 Savannah p25-p53  26/02/2015  15:58  Page 50

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

24. SHARE OPTIONS AND WARRANTS 

Share options and warrants to subscribe for Ordinary Shares in the Company are granted to certain employees,
Directors, investors and suppliers providing services to the Group. Some of the options issued vest immediately
and others over a vesting period and may include performance conditions. Options are forfeited if the employee
leaves the group before the options vest.

2014

Weighted

2013

Weighted

average Weighted
exercise remaining
life

price

Number

average Weighted 
exercise remaining
life

price

4.5p
6.8p
–

5.2p

12.5p
–
12.5p

12.5p

11.0p
11.0p
12.5p

4.6p

– 5,550,000
– 16,386,776
– (4,713,333)

3.19 17,223,443

– 4,850,000
– (2,850,000)
–
–

0.81 2,000,000

– 57,949,993
– 11,111,112
–
–

3.50 69,061,105

10.5p
3.6p
8.7p

4.5p

12.5p
12.5p
–

12.5p

12.5p
3p
–

11.0p

–
–
–

4.18

–
–
–

1.81

–
–
–

1.43

Number

17,223,443
7,300,000
–

24,523,443

2,000,000
–

(1,636,740) 1

363,260

69,061,105
2,800,000
(57,949,993) 2

13,911,112

Share Options
Opening Balance 
Granted
Lapsed

Closing Balance

Share Warrant Options
Opening Balance
Lapsed
Forfeited

Closing Balance

Investor Warrants
Opening Balance
Granted
Lapsed

Closing Balance

1 Share Warrant Options were forfeited upon the lapse of the 2010 Investor Warrants

2 Investor Warrants expired on 1 November 2014

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

24. SHARE OPTIONS AND WARRANTS continued

Share schemes outstanding at 31 December 2014 are as follows:

Outstanding
Exercisable
Exercisable Outstanding
31 December 31 December 31 December 31 December 
2013

2014

2014

2013

100,000

100,000

100,000

2,000,000 1,750,000 2,000,000 1,750,000
100,000
3,726,667 3,726,667 3,726,667 3,726,667
5,321,776 5,321,776 5,321,776 5,321,776
–
4,500,000 4,500,000 4,500,000
1,575,000 1,575,000 1,575,000 1,575,000
–
3,000,000 3,000,000
–
3,300,000 3,300,000
–
–
1,000,000

–
–
–

Exercise 
Price

Expiry Date

10.0p
10.4p
4.6p
3.0p
3.0p
4.6p
8.8p
5.0p
7.0p

21 October 2015
28 April 2016
31 January 2018
20 July 2018
21 September 2018
30 September 2018
25 February 2019
3 July 2017
12 September 2017

24,523,443 23,273,443 17,223,443 12,473,443

363,260

317,852 2,000,000 1,750,000

12.5p

21 October 2015

363,260

317,852 2,000,000 1,750,000

–

– 57,949,993 57,949,993
11,111,112 11,111,112 11,111,112 11,111,112
–
2,800,000 2,800,000

–

12.5p
3.0p
11.0p

1 November 2014
19 July 2018
17 April 2018

Share Options
October 2010
April 2011
February 2013
July 2013
September 2013
September 2013
February 2014
July 2014
September 2014

Share Warrant Options
October 2010

Investor Warrants
October 2010
September 2013
April 2014

13,911,112 13,911,112 69,061,105 69,061,105

All of the options and warrants granted attract a share based payment charge. The grants have been measured
using the Black-Scholes pricing model that takes into account factors such as the option life, share price volatility
and the risk free rate. Volatility was calculated with reference to the Company’s historical share price volatility
up to the grant date to reﬂect a term approximate to the expected life of the option.

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235402 Savannah p25-p53  26/02/2015  15:58  Page 52

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

24. SHARE OPTIONS AND WARRANTS continued

The range of inputs of the options and warrants granted in the year are as follows:

Share Options
Stock price
Fair value of option
Exercise Price
Expected volatility
Expected life
Risk free rate
Dividend yield

Investor Warrants
Stock price
Fair value of option
Exercise Price
Expected volatility
Expected life
Risk free rate
Dividend yield

2014

2013

4.6p – 8.2p
1.9p – 4.4p
5.0p – 8.8p
62% – 66%
3 – 5 years
2.5%
nil

1.9p – 4.1p
0.8p – 3.0p
3.0p – 4.6p
53% – 62%
5 years
2.5%
nil

7.8p
3.2p
11.0p
65%
4 years
2.5%
nil

4.0p*
2.4p
3.0p
62%
5 years
2.5%
nil

* The stock asset price was greater than the option strike price due to the delay between the Board approval and the Shareholder
approval of the options.

This fair value is the cost that is charged to the Statement of Comprehensive Income and is spread over the
expected vesting period which, for non-market vesting conditions (as noted above), is revised at each period
end. If the issue was a share issue cost the charge is to the Share Premium account.

Share options issued
During the year 7,300,000 share options were issued to employees and Directors to assist with the recruitment,
reward  and  retention  of  key  employees.  Some  of  the  options  vest  immediately  and  some  vest  upon  the
employee meeting service and/or performance conditions.

During the 2013 ﬁnancial year 6,565,000 share options were issued to key employees and the former CEO Mark
Jones, in lieu of cash salary as part of the Company’s cash conservation measures. A further 9,821,776 share
options were issued in respect of either reduced fees/nominal fees (£1 per annum) paid to Directors and key
personnel.

Investor Warrants issued
During the year 2,800,000 warrants were issued to Bergen Global Opportunity Fund LP in accordance with the
execution of the facility agreement. The warrants were issued with an exercise price of 11.0p, equal to 135%
of the average weighted price for the 20 trading days prior to issue.

During  the  2013  ﬁnancial  year  David  Archer  was  granted  11,111,112  warrants  in  consideration  of  a  cash
subscription of £500,000 for shares and warrants with shareholder approval obtained at a shareholders meeting
on 24 September 2013.

Options issued to Directors
Refer to Report of Directors for share options and warrants issued to Directors.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

25. EVENTS SINCE THE REPORTING DATE

On 19 January 2015 the Company issued 637,381 ordinary shares as consideration for an exploration database
relating to the Block 4 Copper Project in Oman. The ordinary shares were issued to settle the AUD 40,000
(~£22,000) consideration for the database.

The Company has disposed of 16.1m of the 173m shares it held in Alecto at 31 December 2014 for consideration
of £49k. The valuation of the Alecto shares at 31 December 2014 was based on a share price of £0.0065 and as
at 23 February 2015 the share price is £0.0015. The Company considers this to be a non-adjusting post balance
sheet event.

On 24 February 2015 the Company transferred US$400,000 (~GBP £257,500) as an initial capital contribution
to achieve a 51% shareholding in Al Thuraya.

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235402 Savannah p54-end  26/02/2015  15:58  Page 54

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of Savannah Resources Plc (‘the Company’) will be held at
the oﬃces of RFC Ambrian Ltd, Condor House, 10 St. Paul’s Churchyard, London EC4M 8AL, on 15 April 2015 at
11:00 a.m. for the purpose of considering and, if thought ﬁt, passing the following resolutions which will be
proposed as ordinary resolutions in the cases of resolutions 1-4 and as a special resolution in the case of resolution 5.

ORDINARY BUSINESS
1

To receive the report of the Directors and the audited Financial Statements of the Company for the year ended
31 December 2014.

2

3

To  re-appoint  Mike  Johnson  who  retires  as  a  Director  in  accordance  with  article  23.1  of  the  Articles  of
Association at the conclusion of the meeting and, being eligible, oﬀering himself for re-election as a Director
of the Company.

To re-appoint BDO LLP as auditors of the Company to act until the conclusion of the next Annual General
Meeting and to authorise the Directors to determine the remuneration of the auditors.

ORDINARY RESOLUTION
4

That in substitution for all existing and unexercised authorities, the Directors of the Company be and they are
hereby generally and unconditionally authorised for the purpose of section 551 of the Companies Act 2006
(‘the Act’) to exercise all or any of the powers of the Company to allot equity securities (within the meaning of
Section 560 of the Act) up to a maximum nominal amount of £1,400,000 provided that this authority shall,
unless previously revoked or varied by the Company in general meeting, expire on the earlier of the conclusion
of the next Annual General Meeting of the Company or 15 months after the passing of this Resolution, unless
renewed or extended prior to such time except that the Directors of the Company may before the expiry of
such period make an oﬀer or agreement which would or might require equity securities to be allotted after the
expiry of such period and the Directors of the Company may allot relevant securities in pursuance of such oﬀer
or agreement as if the authority conferred hereby had not expired.

SPECIAL RESOLUTION
5

That in substitution for all existing and unexercised authorities and subject to the passing of the immediately
preceding Resolution, the Directors of the Company be and they are hereby empowered pursuant to section
570 of the Act to allot equity securities (as deﬁned in section 560 of the Act) pursuant to the authority conferred
upon them by the preceding Resolution as if section 561(1) of the Act did not apply to any such allotment
provided that the power conferred by the Resolution, unless previously revoked or varied by special resolution
of the Company in general meeting, shall be limited:

(a) to the allotment of ordinary shares arising from the exercise of options, warrant options and warrants

outstanding at the date of this resolution;

(b) to the allotment of equity securities in connection with a rights issue in favour of ordinary shareholders
where  the  equity  securities  respectively  attributable  to  the  interest  of  all  such  shareholders  are
proportionate (as nearly as may be) to the respective numbers of the ordinary shares held by them subject
only to such exclusions or other arrangements as the Directors of the Company may consider appropriate
to deal with fractional entitlements or legal and practical diﬃculties under the laws of, or the requirements
of any recognised regulatory body in, any territory;

(c) the grant of a right to subscribe for, or to convert any equity securities into Ordinary Shares otherwise than

under sub-paragraph (a) above, up to a maximum aggregate nominal amount of £150,000;

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NOTICE OF ANNUAL GENERAL MEETING

(d) pursuant to the share exchange agreement for 80% of the issued share capital of Matilda Minerals Lda, up

to a maximum aggregate nominal value of £400,000; and 

(e) to the allotment (otherwise than pursuant to sub-paragraphs (a), (b), (c) and (d) above) of equity securities
up to an aggregate nominal amount of £450,000 (approximately 20% of the Company’s issued share capital)
in respect of any other issues for cash consideration; 

and shall expire on the earlier of the date of the next Annual General Meeting of the Company or 15 months
from the date of the passing of this Resolution save that the Company may before such expiry make an oﬀer
or agreement which would or might require equity securities to be allotted after such expiry and the Directors
may allot equity securities in pursuance of such oﬀer or agreement as if the power conferred hereby had not
expired.

If you are a registered holder of Ordinary Shares in the Company, whether or not you are able to attend the meeting,
you may use the enclosed form of proxy to appoint one or more persons to attend and vote on a poll on your behalf.
A proxy need not be a member of the Company.

A form of proxy is provided.

This may be sent by facsimile transfer to 01252 719 232 or by mail using the reply paid card to:

The Company Secretary
Savannah Resources Plc
c/o Share Registrars Limited
Suite E
First Floor
9 Lion and Lamb Yard
Farnham
Surrey GU9 7LL

In either case, the signed proxy must be received no later than 48 hours (excluding non-business days) before the
time of the meeting, or any adjournment thereof.

Registered Oﬃce: 

By order of the Board

Third Floor
55 Gower Street
London WC1E 6HQ
24 February 2015

Stephen Ronaldson
Company Secretary

Registered in England and Wales Number: 07307107

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p54-end  26/02/2015  15:58  Page 56

NOTICE OF ANNUAL GENERAL MEETING

Notes to the Notice of General Meeting
Entitlement to Attend and Vote
1. Pursuant to Regulation 41 of the Uncertiﬁcated Securities Regulations 2001, the Company speciﬁes that only
those members registered on the Company’s register of members 48 hours before the time of the Meeting
shall be entitled to attend and vote at the Meeting.

Appointment of Proxies
2.

If you are a member of the Company at the time set out in note 1 above, you are entitled to appoint a proxy to
exercise all or any of your rights to attend, speak and vote at the Meeting and you should have received a proxy
form with this notice of meeting. You can only appoint a proxy using the procedures set out in these notes and
the notes to the proxy form.

3.  A proxy does not need to be a member of the Company but must attend the Meeting to represent you. Details
of how to appoint the Chairman of the Meeting or another person as your proxy using the proxy form are set
out in the notes to the proxy form. If you wish your proxy to speak on your behalf at the Meeting you will need
to appoint your own choice of proxy (not the Chairman) and give your instructions directly to them.

4. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to diﬀerent
shares. You may not appoint more than one proxy to exercise rights attached to any one share. To appoint more
than one proxy, please contact the registrars of the Company, Share Registrars Limited on 01252 821 390.

5. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes
for or against the resolution. If no voting indication is given, your proxy will vote or abstain from voting at his
or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks ﬁt in relation to any other
matter which is put before the Meeting.

Appointment of Proxy Using Hard Copy Proxy Form
6.  The notes to the proxy form explain how to direct your proxy how to vote on each resolution or withhold their

vote.

To appoint a proxy using the proxy form, the form must be:

–

–

–

Completed and signed;

Sent or delivered to Share Registrars Limited at Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey
GU9 7LL or by facsimile transmission to 01252 719 232; and

Received by Share Registrars Limited no later than 48 hours (excluding non-business days) prior to the
Meeting.

In the case of a member which is a Company, the proxy form must be executed under its common seal or signed
on its behalf by an oﬃcer of the Company or an attorney for the Company.

Any power of attorney or any other authority under which the proxy form is signed (or a duly certiﬁed copy of
such power or authority) must be included with the proxy form.

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NOTICE OF ANNUAL GENERAL MEETING

Appointment of Proxy by Joint Members
7. 

In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the
appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in
which the names of the joint holders appear in the Company’s register of members in respect of the joint
holding (the ﬁrst-named being the most senior).

Changing Proxy Instructions
8.  To change your proxy instructions simply submit a new proxy appointment using the methods set out above.
Note that the cut-oﬀ time for receipt of proxy appointments (see above) also apply in relation to amended
instructions; any amended proxy appointment received after the relevant cut-oﬀ time will be disregarded.

Where you have appointed a proxy using the hard-copy proxy form and would like to change the instructions
using another hard-copy proxy form, please contact Share Registrars Limited on 01252 821 390.

If you submit more than one valid proxy appointment, the appointment received last before the latest time for
the receipt of proxies will take precedence.

Termination of Proxy Appointments
9. 

In order to revoke a proxy instruction you will need to inform the Company using one of the following methods:

By sending a signed hard copy notice clearly stating your intention to revoke your proxy appointment to Share
Registrars  Limited  at  Suite  E,  First  Floor,  9  Lion  and  Lamb  Yard,  Farnham,  Surrey  GU9  7LL  or  by  facsimile
transmission to 01252 719 232. In the case of a member which is a Company, the revocation notice must be
executed under its common seal or signed on its behalf by an oﬃcer of the Company or an attorney for the
Company. Any power of attorney or any other authority under which the revocation notice is signed (or a duly
certiﬁed copy of such power or authority) must be included with the revocation notice.

In either case, the revocation notice must be received by Share Registrars Limited no later than 48 hours
(excluding non-business days) prior to the Meeting.

If you attempt to revoke your proxy appointment but the revocation is received after the time speciﬁed then,
subject to the paragraph directly below, your proxy appointment will remain valid.

Appointment of a proxy does not preclude you from attending the Meeting and voting in person. If you have
appointed a proxy and attend the Meeting in person, your proxy appointment will automatically be terminated.

Issued shares and total voting rights
10. As at 24 February 2015, the Company’s issued share capital comprised 223,807,095 ordinary shares of £0.01
each. Each ordinary share carries the right to one vote at a general meeting of the Company and, therefore,
the total number of voting rights in the Company as at 24 February 2015 is 223,807,095.

Communications with the Company
11. Except  as  provided  above,  members  who  have  general  queries  about  the  Meeting  should  telephone  the
Company Secretary, Stephen Ronaldson, on (020) 7580 6075 (no other methods of communication will be
accepted). You may not use any electronic address provided either in this notice of general meeting; or any
related documents (including the chairman’s letter and proxy form), to communicate with the Company for
any purposes other than those expressly stated.

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

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235402 Savannah p54-end  26/02/2015  15:58  Page 58

NOTICE OF ANNUAL GENERAL MEETING

CREST
12. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service
may do so for the General Meeting and any adjournment(s) thereof by using the procedures described in the
CREST Manual. 

CREST Personal Members or other CREST sponsored members, and those CREST members who have appointed
a voting service provider(s) should refer to their CREST sponsor or voting service provider(s), who will be able
to take the appropriate action on their behalf.

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST
message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK &
Ireland Limited’s speciﬁcations and must contain the information required for such instructions, as described
in the CREST Manual (available via euroclear.com/CREST). 

The message, regardless of whether it relates to the appointment of a proxy or to an amendment to the
instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received
by the issuer’s agent (ID: 7RA36) by the latest time(s) for receipt of proxy appointments speciﬁed above. For
this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the
message by the CREST Applications Host) from which the issuer’s agent is able to retrieve the message by
enquiry to CREST in the manner prescribed by CREST. After this time, any change of Instructions to proxies
appointed through CREST should be communicated to the appointee through other means.

CREST members and, where applicable, their CREST sponsors or voting service providers should note that
Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages.
Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions.
It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal
member or sponsored member or has appointed a voting service provider(s), to procure that his or her CREST
sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is
transmitted  by  means  of  CREST  by  any  particular  time.  In  this  connection,  CREST  members  and,  where
applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the
CREST Manual concerning practical limitations of the CREST system and timings.

The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a)
of the Uncertiﬁcated Securities Regulations 2001.

58

SAVANNAH RESOURCES Plc – ANNUAL REPORT AND FINANCIAL STATEMENTS 2014

235402 Savannah p54-end  26/02/2015  15:58  Page 60

DIRECTORS:

SECRETARY:

REGISTERED OFFICE:

COMPANY INFORMATION

Professor M S Johnson
D S Archer
D J Ferguson
C Cannon-Brookes

Chairman 
Executive Director
Executive Director
Non-Executive Director

S F Ronaldson
55 Gower Street
London
WC1E 6HQ

Third Floor
55 Gower Street
London
WC1E 6HQ

REGISTERED NUMBER:

07307107 (England and Wales)

AUDITORS:

BANKERS:

NOMINATED ADVISOR & BROKER:

SOLICITORS:

REGISTRARS:

BDO LLP
Chartered Accountants & Statutory Auditors
55 Baker Street
London
W1U 7EU

NatWest Bank Plc
St James’ & Piccadilly Branch
PO Box 2DG
208 Piccadilly
London
W1A 2DG

RFC Ambrian Ltd
Condor House
10 St. Paul’s Churchyard
London
EC4M 8AL

Ronaldsons LLP
55 Gower Street
London
WC1E 6HQ

Share Registrars
9 Lion & Lamb Yard
Farnham
Surrey
GU9 7LL

WEBSITE:

www.savannahresources.com

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