Orogen plc (formerly Orogen Gold plc)
Annual Report
For the year ended
31 December 2016
Contents
Company Overview
Chairman’s Statement
Strategic Report
Corporate Governance
Board of Directors
Group Directors’ Report
Consolidated Financial Statements
Independent Auditors’ Report
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
Company Statement of Financial Position
Company Statement of Cash Flows
Company Statement of Changes in Equity
Notes to the Consolidated Financial Statements
Company Information
Annual General Meeting
Notice of Annual General Meeting
Form of Proxy
Page
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3
7
8
12
14
15
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17
18
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42
43
47
Orogen plc (formerly Orogen Gold plc)
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Annual Report 2016
CHAIRMAN’S STATEMENT
On 21 March 2017, the Company announced that it had completed a review of its operations and had
concluded that it was no longer in Shareholders' interests for the Company to continue to provide
financial support for its mineral exploration activities. The Board proposed to dispose of the
Company's mineral exploration interests and change the Company's business strategy. The Company
became an AIM Rule 15 cash shell on 7 April 2017.
On 26 May 2017, the Company announced that it had agreed heads of terms with Thread 35 Limited
(“Thread”) to acquire Thread’s entire issued share capital, subject to certain conditions and due
diligence. This acquisition would constitute a reverse transaction under the AIM rules. Thread
operates an e-commerce womenswear brand under the brand name “Sosandar”.
As at the date of this report, discussions are continuing the disposal of the mineral interests and the
other subsidiaries of Orogen.
I am delighted with the progress we are making with regards to the due diligence process relating to
the acquisition of Thread. I believe we have identified a very exciting acquisition, with a strong and
experienced management team in a market sector that is growing rapidly. I look forward to reporting
back to shareholders in due course.
______________
Adam Reynolds
Chairman
Date: 28 June 2017
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Annual Report 2016
STRATEGIC REPORT
REVIEW OF BUSINESS
Mutsk Gold Project, Armenia
Exercise of Earn-in Option
During the year, Orogen completed the earn-in exploration expenditures of US$2.5 million on the
Mutsk property prior to the required date of 31 August 2016. On completion of the earn-in
expenditure Orogen exercised its option to acquire an 80% interest in Georaid CJSC, the Armenian
registered company which holds the exploration licence covering the Mutsk property. Orogen
received its 80% interest during the year. An additional £125,000 of exploration expenditure was
incurred on the project after the option exercise date in the period to 31 December 2016. As the
Company’s partners on the project have not contributed to this expenditure as is required to maintain
their 20% interest in the project, Orogen’s interest in the project increased to approximately 82% by
the year end.
2016 Exploration Programme
Diamond drilling at the Mutsk gold property recommenced in early July 2016 with the aim of extending
the footprint of the gold deposit. An initial programme of seven holes totalling 1,015 metres directed
towards the east was completed in early September 2016. The holes were focussed to the east and
south of the main gold zone at Mutsk. Six of the seven holes completed cut sections of hydrothermal
alteration with associated gold-bearing intervals.
A further step-out drilling programme was undertaken in October-November 2016 comprising of four
step-out diamond drill holes to assess the potential strike extent of the Mutsk gold deposit. All holes
were drilled at 50 degrees towards the east.
Overall, management was very encouraged by the outcome of a relatively limited drilling programme
in 2016. This has demonstrated that a substantial gold deposit has been discovered with open pit
potential. The strike length of the Mutsk deposit has been substantially increased in the current year
from 0.5km to 1.3km, with the deposit still open to the south. In addition, drilling to the east of the
original discovery has located further multiple gold bands, almost doubling the mineralisation
footprint from east to west. There is also potential for additional discoveries further to the east, as
well as at depth. The drilling has given an indication of the potential scale of the project.
Silverton, Nevada
The Silverton project is located northeast of Tonopah in the central Pancake Range in Nevada, USA.
Over the last three decades multiple companies have explored the property for gold and silver.
In June 2016 Orogen signed an agreement with Galileo Resources plc (“Galileo”) pursuant to which
Orogen has the right to earn-in to a 51% interest in the project by way of exploration expenditure of
US$400,000 (the "First Expenditure") within 18 months and thereafter the possibility to spend an
additional US$1,500,000 (the "Second Expenditure") within 30 months to earn-in a further 24%
interest, in total 75%, in the project. Galileo will have the right to participate pro rata after the First
Expenditure; should it exercise this right it would retain a 49% equity interest in Silverton (as opposed
to being diluted down to 25%).
In October 2016, Orogen completed a total of 1,274m of reverse circulation drilling in five holes on
two targets within the Silverton claim area. Holes were targeted primarily at testing the Silverton Fault
Zone at depth beneath previous shallower vertical drilling that had intercepted moderate to low grade
gold and silver mineralisation over significant widths in the fault hanging-wall. The Silverton Fault
appeared to be a potential feeder to widespread shallow gold mineralisation.
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Annual Report 2016
STRATEGIC REPORT
The holes generally confirmed earlier results, with low-grade gold occurring in a package of iron-
stained and pyrite-bearing felsitic tuff and quartzite within the hanging-wall sequence above the fault
structure. Three of the four holes aimed at the fault zone intersected gold mineralisation, however
the intercepts were not enhanced compared to the shallower historic holes. While the geology was
much as expected, no significant gold mineralisation was encountered.
CHANGE OF NAME AND STRATGEY
While the 2016 drilling results at Mutsk were encouraging in that they extended the gold deposit
footprint, an independent study of the deposit has concluded that the current resource lies well below
the target of 1,000,000 ounces of gold for the project. The Company believes that there is scope to
add to the resource through additional exploration and infill drilling, albeit that the overall gold grade
of circa 1 g/t is low and will therefore require significant additional tonnage to move the project
forward to a commercial mine. As the Company has limited capital resources, and the Board does not
consider that the Company will be able to raise the relatively significant level of new funds on
acceptable terms to finance the further exploration that is needed to delineate the target orebody, it
has been decided that a sale or joint venture of this project to a larger and more financially robust
entity gives the project the opportunity to move forward and gives the Company some expectation of
recovering part of its investment.
The drilling results at Silverton in Nevada were disappointing. A low grade zone has been encountered
on the Silverton fault zone, but there is no sign of gold enhancement at depth. The Board does not
consider that these results provide a strong case for further drilling.
On 21 March 2017, Orogen announced details of a proposed new strategy and consequent
restructuring of its operations. The Board has completed a review of its operations and has concluded
that it is no longer in shareholders’ interests for the Company to continue to provide financial support
for its mineral exploration activities. It is therefore seeking to dispose of its interests in its mineral
exploration projects, and to conclude an acquisition which would constitute a reverse takeover under
the AIM Rules. The Company has decided to cap further expenditure on its existing mineral
exploration projects at £75,000 and to put them on care and maintenance programmes whilst buyers
are sought for the Company’s interests in these assets.
As an initial step in the above restructuring, the Company proposed to undertake a share consolidation
and sub-division in order to increase the price at which the Company’s shares trade on AIM and to
enable the Company to raise funds through the issue of new shares. As part of the proposals that were
put to a shareholder vote on 7 April 2017, up to £3.47m of new funds were to be introduced to the
company to implement the new strategy and the Company’s name was to be changed to Orogen plc.
All resolutions put to shareholders were approved at a general meeting on 7 April 2017. Accordingly,
the capital reorganisation and change of the Company name to Orogen plc were completed.
The decision to cease the Company's mineral exploration activities represents a fundamental change
of business under Rule 15 of the AIM Rules. Following the resolutions being passed, the Company is
deemed to be an AIM Rule 15 cash shell, which means that the Company must make an acquisition or
acquisitions which constitute a reverse takeover under Rule 14 of the AIM Rules within six months of
the general meeting, otherwise the trading of the Company's shares on AIM will be suspended. If the
Company has not made an acquisition or acquisitions which constitute a reverse takeover under Rule
14 of the AIM Rules within six months of such suspension, the admission of the Company's shares to
trading on AIM will be cancelled.
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Annual Report 2016
STRATEGIC REPORT
FINANCIAL AND CORPORATE
The loss for the year amounted to £3,083,000 (2015: £890,000). The loss for the year comprises an
impairment charge of £2,691,000 (2015: £534,000), general and administrative expenses of £375,000
(2015: £356,000), share based payment charge of £20,000 (2015: £5,000) and finance income of
£3,000 (2015: £5,000). The impairment charge is as a result of a review performed on the carrying
value of the exploration and evaluation assets related to the Mutsk Gold Project (£2,515,000) and
Silverton project (£168,000). A further £8,000 (2015: £534,000) was impaired on the Deli Jovan project
and has been included in the loss on discontinued operations.
Following the completion of the capital reorganisation and placing on 7 April 2017 there was a total
of 262,728,022 ordinary shares in issue. The Company raised gross proceeds of approximately £3.47
million, through an open offer, placing and second placing which added 231,364,011 ordinary shares
to the 31,364,011 ordinary shares in existence after the capital reorganisation.
Immediately following the general meeting on 7 April 2017, Colin Bird, Edward Slowey, Michael Nolan
and Alan Mooney resigned from the Board and Steven Metcalfe and Mark Collingbourne were
appointed as non-executive directors of the Company with immediate effect. In addition, the
Company appointed Turner Pope Investments (TPI) Ltd as sole broker with immediate effect.
PRINCIPAL RISKS AND UNCERTAINTIES
The success of the Company is dependent on its ability to identify appropriate acquisitions and to
attract sufficient funding to successfully develop them. The Company considers that the principal risks
to the achievement of its business plans are as follows:
•
Implementation risk: The Company’s future success is largely dependent upon its ability to
identify and execute a successful acquisition or acquisitions which constitutes a reverse
takeover under Rule 14 of the AIM Rules. At the date of this report, whilst the Directors and
have identified a number of potential acquisition opportunities that might be suitable for
further consideration, the Directors have not carried out any due diligence on any acquisition
opportunities or entered into any discussions or agreements in relation to any opportunity.
There can be no assurance that the Company will be able to identify opportunities that are
suitable or conclude agreements with any target business in the future. In addition, the
Company may face competition for acquisitions from other organisations which may be larger
and/or better funded. The Company cannot accurately predict how long it will take to deploy
the capital available to it, if at all. Precise timings will depend on, among other things, the
availability of suitable acquisitions, due diligence, negotiations with counterparties and
investment structuring considerations.
• Due diligence risk: The due diligence process that the Company will undertake in connection
with the strategy may not reveal all facts that may be relevant in connection with a proposed
acquisition. Before investing, the Company is expected to conduct due diligence on a potential
acquisition, including valuation analysis in order to identify material issues which might affect
an investment decision. In many cases, the Company will rely on third parties and public
information to conduct any such due diligence. The due diligence process may at times be
subjective and only limited information may be available. In addition, the Company expects
that any third party due diligence, feasibility, valuation or similar analyses will be subject to a
number of qualifications and may be based on assumptions that could prove to be incorrect.
Accordingly, the Company cannot assure investors that the due diligence investigation that it
or any third party will carry out with respect to any future development will reveal or highlight
all relevant risks associated with such an acquisition. Due diligence may also be insufficient to
reveal all of the past and future liabilities relating to the operations and objectives of the
target. The Company may lose all or part of the value of such acquisition, which could have a
Orogen plc (formerly Orogen Gold plc)
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Annual Report 2016
STRATEGIC REPORT
material adverse effect on the Company’s financial condition and results of operations and
which could reduce the value of the Company’s ordinary shares.
• Financial risk: There is a risk that the Company may incur substantial legal, financial and
advisory expenses arising from unsuccessful transactions. The net proceeds of the April 2017
placing are likely to be insufficient to fund in full all suitable acquisitions identified by the
Board. Accordingly, the Company expects to seek additional sources of financing to implement
its strategy. There can be no assurance that the Company will be able to raise those funds,
whether on acceptable terms or at all. If further financing is obtained by issuing equity
securities or convertible debt securities, existing shareholders may be diluted and the new
securities may carry rights, privileges and preferences superior to existing ordinary shares.
The Company may seek debt finance to fund all or part of any future acquisition. There can be
no assurance that the Company will be able to raise those debt funds, whether on acceptable
terms or at all. If such funding is unavailable, the Company may be required to reduce the
scope of its operations or anticipated expansion. If debt financing is obtained, the Company’s
ability to raise further finance and its ability to operate its business may be subject to
restrictions imposed by the providers of such funding.
For and on behalf of the board:
_________________
Adam Reynolds
Director
Date: 28 June 2017
Orogen plc (formerly Orogen Gold plc)
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Annual Report 2016
BOARD OF DIRECTORS
Biographical details of the Directors
Adam Reynolds – Non-Executive Chairman
Adam began his career as a stockbroker before moving into investor relations. In 2000, he established
Hansard Group plc, a financial PR firm, admitting its shares to trading on AIM in November 2000,
before jointly leading a management buy-out of the business in 2004. Adam is also a non-executive
director of EKF Diagnostics plc and HubCo Investments plc and a director of Wilton International
Marketing Limited and Autoclenz Holdings Limited.
Steven Metcalfe - Non-Executive Director
Steven is a former stockbroker with more than 28 years' experience in the financial industry. In 2005,
as Head of UK Equities at Hichens Harrison, he was involved in the management buyout and then
subsequent sale to Religare Capital Markets. For the last seven years, he has been involved with
institutions, hedge funds and high net worth individuals within the regulated arena. Since leaving
Investment Banking in mid-2016, he is now using his substantial background and history within the
financial and corporate world and has set up a consultancy business that advises SMEs on finance,
strategy and growth within their chosen area.
Mark Collingbourne - Non-Executive Director
Mark is a qualified accountant with significant experience in financial management, particularly in the
area of publicly quoted companies. He has dealt with all aspects of PLC development from bringing
small companies to flotation to supervising the on-going accountancy and ensuring the good
governance of international businesses.
During his ten year tenure with ViaLogy plc (now Premaitha Health plc), Mark was a key member of
the team that arranged its transformation from a private US organisation to an AIM company, via a
merger with Original Investments PLC. He also played a major part in arranging the financial details of
ViaLogy's restructuring.
Previously, after periods with ITV Network Centre and Mechanical Copyright Protection Society
Limited, Mark was appointed Finance Director of Curtis Brown Group Limited, one of the UK's leading
literary agencies, in 1996, where he managed the financial implications of the management buyout in
2001.
Mark is currently Finance Director of React Group Plc and Chief Finance Officer of Optibiotix Health
PLC. Mark also holds board positions on a number of small private companies.
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Annual Report 2016
GROUP DIRECTORS’ REPORT
The Directors present their report and the consolidated financial statements for the year ended 31
December 2016.
Change of Name and Strategy
On 7 April 2017 at a general meeting of the Company, Orogen shareholders voted to adopt resolutions
to effect a change of strategy and to change the name of the Company from Orogen Gold plc to Orogen
plc. Trading on AIM commenced under the new Company name on 10 April 2017.
The decision to cease the Company's mineral exploration activities represents a fundamental change
of business under Rule 15 of the AIM Rules. The Company is deemed to be an AIM Rule 15 cash shell,
which means that the Company must make an acquisition or acquisitions which constitute a reverse
takeover under Rule 14 of the AIM Rules within six months of the 7 April 2017 general meeting,
otherwise the trading of the Company's shares on AIM will be suspended. If the Company has not
made an acquisition or acquisitions which constitute a reverse takeover under Rule 14 of the AIM
Rules within six months of such suspension, the admission of the Company's shares to trading on AIM
will be cancelled.
Results and dividends
The Group loss after tax for the year ended 31 December 2016 amounts to £3,083,000 (2015:
£890,000). The Directors are not recommending payment of a final dividend for the year (2015: £nil).
Directors
The Directors who served on the Board during the year and to the date of this report are as follows:
Adam Reynolds
Colin Bird (resigned on 7 April 2017)
Ed Slowey (resigned on 7 April 2017)
Alan Mooney (resigned on 7 April 2017)
Michael Nolan (resigned on 7 April 2017)
Steven Metcalfe (appointed 7 April 2017)
Mark Collingbourne (appointed 7 April 2017)
Under the terms of the articles of association all Directors must retire by rotation every three years
and may seek re-election to the Board at the Annual General Meeting of the Company. The articles
also provide for one-third of the Directors to retire by rotation. All new Directors appointed since the
previous Annual General Meeting must seek re-election at the next Annual General Meeting in order
to ratify their appointment to the Board by the members.
The Directors required to seek re-election at the next Annual General Meeting are Steven Metcalfe
and Mark Collingbourne as directors appointed since the previous AGM and Adam Reynolds by
rotation.
Shares and listing
During the period the Company had two classes of share capital, ordinary shares of 0.01p each and
deferred shares of 0.9p each. On 7 April 2017, every 250 existing ordinary shares of par value 0.01p in
the Company at close of business on 7 April 2017 became 1 new ordinary share of par value 0.01p and
249 new deferred shares of par value 0.01p. The rights attaching to the new ordinary shares of 0.01p
will be identical in all respects to those of the old ordinary shares of 0.01p.
Similar to the old deferred shares of 0.9p each, the new deferred shares of 0.01p created are
effectively valueless as they will not carry any rights to vote or dividend rights. In addition, holders of
deferred shares will only be entitled to a payment on a return of capital or on a winding up of the
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Annual Report 2016
GROUP DIRECTORS’ REPORT
Company after each of the holders of new ordinary shares of 0.01p each have received a payment of
£10,000,000 on each such share. The new deferred shares are not and will not be listed or traded on
AIM or any other investment exchange and are only transferable in limited circumstances.
The Company’s new ordinary shares of 0.01p are listed on the Alternative Investment Market (“AIM”)
market of the London Stock Exchange (ticker: ORE.L). At the date of this report, 264,728,022 new
ordinary shares of 0.01p each were in issue (see note 23 for further information). Details of share
issues and changes to the capital structure during the year are set out in note 16 and 23. Details of the
nominated advisor and brokers are presented on the Company Information at the end of this annual
report.
Substantial shareholdings
As at 26 June 2017 the following held 3% or more of the share capital of the Company:
Rank
1
2
3
4
Shareholder
Spreadex Limited
Christopher Potts
Axiom Wealth Management Limited
Epsilon Investments pte Limited
A Based on 264,728,022 ordinary shares on 26 June 2017.
No of shares at
26 June 2017
27,784,866
13,333,333
12,333,333
10,000,000
% Issued
Capital
10.50
5.04
4.66
3.78
Corporate governance
The Company is subject to the UK City Code on Takeovers and Mergers.
The Quoted Companies Alliance Code ("QCA Code") adopts key elements of the UK Corporate
Governance Code, current policy initiatives and other relevant guidance and then applies these to the
needs and particular circumstances of small and mid-size quoted companies on a public market.
Focusing on 12 principles and a set of minimum disclosures, the QCA Code encourages companies to
consider how or whether they should apply each principle to achieve good governance and provide
quality explanations to their shareholders about what they have done.
Committees of the Board
The Directors have established Audit and Remuneration Committees.
The Audit Committee
The Audit Committee currently comprises Steven Metcalfe as Chairman and Adam Reynolds and has
primary responsibility for monitoring the quality of internal controls ensuring that the financial
performance of the Company is properly measured and reported on and reviewing reports from the
Company's auditors relating to the Company's accounting and internal controls, in all cases having due
regard to the interests of Shareholders. The Audit committee meets at least twice a year.
The Remuneration Committee
The Remuneration Committee currently comprises Adam Reynolds as Chairman and Steven Metcalfe
who review the performance of the executive directors and determine their terms and conditions of
service, including their remuneration and the grant of options, having due regard to the interests of
Shareholders. The Remuneration Committee meets no less than once every year.
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Annual Report 2016
GROUP DIRECTORS’ REPORT
Directors’ remuneration
Details of emoluments received by Directors of the Company for the year ended 31 December 2016
are as follows:
Edward Slowey
Colin Bird
Adam Reynolds
Alan Mooney
Michael Nolan
Anthony Venus
Total
2016 Total
£
60,000
20,000
15,000
15,000
15,000
—
125,000
2015 Total
£
79,750
5,000
29,625
21,875
21,875
13,875
172,000
Directors and their interests
The Directors of the Company held the following beneficial interests in the shares and share options
of Orogen plc at 31 December 2016 and 31 December 2015:
Edward Slowey
Michael Nolan
Alan Mooney
Colin Bird
Adam Reynolds
Ordinary
shares of
0.01p each
663,584
540,443
518,443
400,000
348,162
Ordinary
shares of
0.01p each
160,000 B
160,000 B
160,000 B
720,000 B
160,000
Share Options
Option
exercise
price
Expiry
£1.50
15/2/2021
£1.50
15/2/2021
15/2/2021
£1.50
£0.0875 30/9/2022
15/2/2021
£1.50
A The share numbers, options and option exercise prices have been adjusted by a factor of 250 to take into account the 250
to 1 share consolidation that took place on 7 April 2017.
B These options lapsed on 7 April 2017 following the board changes that were effective on that date as a result of the change
of company strategy.
Going concern
After making appropriate enquires, the Directors consider that the Company has adequate resources
to continue in operational existence for the foreseeable future. As part of their enquiries the Directors
have reviewed cash forecasts for the company’s operations for the 12 months from the date of
approval of the financial statements. The Company has adequate cash to cover its corporate
overheads and management costs over this period. The Company raised £3.47m before costs in a
share placing in April 2017 and will cap expenditure on exploration projects at £75,000 after the
change of strategy date of 7 April 2017. The Group acts as operator on its projects, which gives it
flexibility in managing the Group’s exploration programmes.
Events after the reporting period
Further information on events after the reporting period is set out in note 23.
Principal risks and uncertainties
The principal risks and uncertainties of the business are discussed in the Strategic Report and in note
21.
Overseas branches
The Company has no overseas branches.
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Annual Report 2016
GROUP DIRECTORS’ REPORT
Directors' responsibilities
The Directors are responsible for preparing the Group Directors' report and financial statements in
accordance with applicable law and International Financial Reporting Standards.
Company law requires the Directors to prepare financial statements for each financial period. Under
that law the Directors have elected to prepare the financial statements in accordance with
International Financial Reporting Standards as adopted for use in the European Union that give a true
and fair view of the state of the affairs of the Group and the Company and of the profit or loss of the
Group for that period.
In preparing these financial statements the Directors are required to:
• Select suitable accounting policies and apply them consistently; and
• make judgements and estimates that are reasonable and prudent; and
•
state whether the Group and Company financial statements have been prepared in
accordance with IFRS as adopted by the European Union, subject to any material departures
disclosed and explained in the financial statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate
to presume that the Group and Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Group’s and Company’s transactions and disclose with reasonable accuracy at any time
the financial position of the Group and Company and to enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also responsible for safeguarding the
assets of the Group and Company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial
information included on the Company’s website.
Auditors
The Board are recommending Jeffreys Henry LLP for re-appointment as auditors of the Group and
Company. Jeffreys Henry LLP have expressed their willingness to accept this appointment and a
resolution re-appointing them will be submitted to the forthcoming Annual General Meeting.
Disclosure of information to the auditors
At the date of approving this report, each Director confirms that, so far as that he is aware, there is no
relevant audit information of which the Group and Company’s auditors are unaware and he 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 and Company’s auditors are aware of that
information.
For and on behalf of the board:
_____________________
Adam Reynolds
Director
Date: 28 June 2017
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Annual Report 2016
INDEPENDENT AUDITORS’ REPORT
Independent Auditors’ report to the members of Orogen plc
We have audited the financial statements of Orogen plc for the year ended 31 December 2016, which
comprise the Consolidated Statement of Profit or Loss and Other Comprehensive Income,
Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated
Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of
Cash Flows, 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
financial 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 auditors' report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company's members 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 set out in the Group Directors’
Report, 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 Auditing Practices Board's Ethical
Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the financial statements
sufficient to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or error. This includes an assessment of: whether the
accounting policies are appropriate to the Group’s and the parent Company's circumstances and have
been consistently applied and adequately disclosed; the reasonableness of significant accounting
estimates made by the directors; and the overall presentation of the financial statements. In addition
we read all financial and non-financial information in the Chairman’s Statement, the Strategic Report
and Group Directors’ Report to identify material inconsistencies with the audited financial statements
and to identify any information that is apparently materially incorrect based on, or materially
inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become
aware of any apparent material misstatements or inconsistencies we consider the implications for our
report.
Opinion on financial statements
In our opinion:
•
•
•
the financial statements give a true and fair view, of the state of the Group’s and Parent
Company's affairs as at 31 December 2016 and of the Group’s loss and Group’s and Parent
Company’s cash flows for the year then ended;
the financial statements have been properly prepared in accordance with International
Financial Reporting Standards as adopted by the European Union;
the parent Company financial statements have been properly prepared in accordance with
IFRS’s as adopted by the European Union and as applied in accordance with the provisions of
the Companies Act 2006; and
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Annual Report 2016
INDEPENDENT AUDITORS’ REPORT
•
the financial statements have been prepared in accordance with the requirements of the
Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit, the information given in the
Strategic Report and in the Group Directors’ Report for the financial year for which the financial
statements are prepared is consistent with the financial statements and the Group Directors’ Report
has been prepared in accordance with the legal requirements.
In addition, in light of the knowledge and understanding of the group and the parent company and its
environment obtained in the course of the audit, we have not identified any material misstatements
in the Strategic Report and the Group Directors’ Report.
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 audit have not been received from branches not visited by us; or
the parent company’s 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.
SACHIN RAMAIYA
(SENIOR STATUTORY AUDITOR)
For and on behalf of Jeffreys Henry LLP, Chartered Accountants, Statutory Auditor
Finsgate
5-7 Cranwood Street
London
EC1V 9EE
United Kingdom
Date: 28 June 2017
Orogen plc (formerly Orogen Gold plc)
P a g e | 13
Annual Report 2016
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2016
Continuing operations
Revenue
Operational costs
Gross profit
General and administrative expenses
Share based payments
Impairment of exploration and evaluation assets
Group operating loss
Finance income
Loss on ordinary activities before taxation
Tax on loss on ordinary activities
Loss for the year from continuing operations
Discontinued operations
Loss for the year from discontinued operations
Total loss for the year
Attributable to:
Equity holders of the parent
Non-controlling interests
Group loss for the year
Exchange translation differences
Total comprehensive loss for the year
Attributable to:
Owners of the parent
Non-controlling interests
Notes
17
9
4
5
7
11
2016
£’000
—
—
—
(334)
(20)
(2,683)
(3,037)
3
(3,034)
—
(3,034)
(49)
(3,083)
(2,609)
(474)
(3,083)
66
(3,017)
(2,543)
(474)
(3,017)
Loss per share:
Loss per share – basic and diluted, attributable to ordinary
equity holders of the parent (pence)
Loss per share - basic and diluted, from continuing
operations (pence)
8
8
(10.3)
(10.1)
20151
£’000
—
—
—
(356)
(5)
—
(361)
5
(356)
—
(356)
(534)
(890)
(677)
(213)
(890)
(2)
(892)
(679)
(213)
(892)
(4.2)
(2.2)
1 - The comparatives have been restated to reflect the reclassification of Deli Jovan Exploration d.o.o. and Orogen Gold (Serbia) Limited
as discontinued operations. The changes in presentation and the circumstances surrounding them are described in Note 2 – Accounting
policies and Note 11 – Discontinued operations.
Orogen plc (formerly Orogen Gold plc)
P a g e | 14
Annual Report 2016
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2016
Assets
Non-current assets
Exploration and evaluation assets
Property, plant and equipment
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Equity and liabilities
Equity
Share capital
Share premium
Other reserves
Retained earnings
Equity attributable to owners of the parent
Non-controlling interests
Total equity
Current liabilities
Trade and other payables
Total current liabilities
Total liabilities
Total equity and liabilities
Notes
2016
£’000
2015
£’000
9
12
14
15
16
16
18
19
—
—
—
46
342
388
388
1,577
2
1,579
22
921
943
2,522
4,651
12,268
676
(17,367)
228
3
231
4,418
12,181
625
(14,765)
2,459
—
2,459
157
157
157
388
63
63
63
2,522
The financial statements were approved and authorised for issue by the Board of Directors on 28 June
2017 and were signed on its behalf by:
_____________________
Adam Reynolds
Director
Company Number: 5379931
Orogen plc (formerly Orogen Gold plc)
P a g e | 15
Annual Report 2016
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2016
Cash flows from operating activities
Group loss for the year – continuing operations
Group loss for the year – discontinued operations
Group loss for the year
Finance income
Share based payments
Profit on disposal of subsidiary
Impairment of exploration and evaluation assets
Working capital adjustments:
Change in trade and other receivables
Change in trade and other payables
Net cash flow from operating activities
Cash flow from investing activities
Expenditure on exploration and evaluation assets and
project earn-ins
Outflow on disposal of subsidiary
Inflow on acquisition of subsidiary
Bank interest received
Net cash flow from investing activities
Cash flow from financing activities
Net proceeds from issue of equity instruments
Net cash flow from financing activities
Notes
5
17
11
9
11
10
5
16
2016
£’000
(3,034)
(49)
(3,083)
(3)
20
(25)
2,691
91
(32)
(341)
(568)
(4)
11
3
(558)
320
320
20151
£’000
(356)
(534)
(890)
(5)
5
—
534
36
(4)
(324)
(292)
—
—
5
(287)
411
411
Net change in cash and cash equivalents
Net foreign exchange difference
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
(200)
3
1,118
921
1 - The comparatives have been restated to reflect the reclassification of Deli Jovan Exploration d.o.o. and Orogen Gold (Serbia) Limited
as discontinued operations. The changes in presentation and the circumstances surrounding them are described in Note 2 – Accounting
policies and Note 11 – Discontinued operations.
(579)
—
921
342
15
15
Orogen plc (formerly Orogen Gold plc)
P a g e | 16
Annual Report 2016
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R
i
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2016
Assets
Non-current assets
Investments
Loans to subsidiaries
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Equity and liabilities
Equity
Share capital
Share premium
Other reserves
Retained earnings – prior periods
Retained earnings – current year
Total equity
Current liabilities
Trade and other payables
Total current liabilities
Total liabilities
Total equity and liabilities
Notes
2016
£’000
2015
£’000
13
13
14
15
16
16
18
18
19
—
100
100
62
64
126
226
—
2,063
2,063
61
301
362
2,425
4,651
12,268
610
(14,860)
(2,581)
88
4,418
12,181
597
(14,514)
(346)
2,336
138
138
138
226
89
89
89
2,425
The financial statements were approved and authorised for issue by the Board of Directors on 28 June
2017 and were signed on its behalf by:
_____________________
Adam Reynolds
Director
Company Number: 5379931
Orogen plc (formerly Orogen Gold plc)
P a g e | 18
Annual Report 2016
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2016
Cash flows from operating activities
Loss for the year – continuing operations
Loss for the year – discontinued operations
Loss for the year
Impairment of investments and loans to subsidiaries
Impairment of exploration and evaluation assets
Share based payments
Working capital adjustments:
Change in trade and other receivables
Change in trade and other payables
Net cash flow from operating activities
Cash flow from investing activities
Expenditure on exploration and evaluation assets and
project earn-ins
Net cash flow from investing activities
Cash flow from financing activities
Net proceeds from issue of equity instruments
Funds advanced to subsidiary companies
Net cash flow from financing activities
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Notes
13
9
17
14
19
9
16
13
15
15
2016
£’000
(2,525)
(63)
(2,588)
2,197
168
20
(1)
49
(155)
(168)
(168)
320
(234)
86
(237)
301
64
2015
£’000
(157)
(189)
(346)
200
—
5
116
(13)
(38)
—
—
549
(550)
(1)
(39)
340
301
Orogen plc (formerly Orogen Gold plc)
P a g e | 19
Annual Report 2016
0
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 General information
Orogen plc (formerly Orogen Gold plc) (the “Company”) is a company incorporated in England and
Wales. Details of the registered office, the officers and advisers to the Company are presented on the
Company Information page at the end of this report. The Company is listed on the AIM market of the
London Stock Exchange (ticker: ORE.L).
The principal activity of the Company during the year was gold and mineral exploration and production
in Europe and the USA. At a general meeting of the Company on 7 April 2017, a change of strategy
was approved by the shareholders of the Company. The Company is now classified as an AIM Rule 15
cash shell.
2 Significant accounting policies
Basis of preparation
The consolidated financial statements consolidate those of the Company and its subsidiaries (together
the “Group” or “Orogen”). The consolidated financial statements of the Group and the individual
financial statements of the Company are prepared in accordance with applicable UK law and
International Financial Reporting Standards ("IFRS") as adopted by the European Union and as applied
in accordance with the provisions of the Companies Act 2006. The Directors consider that the financial
information presented in these Financial Statements represents fairly the financial position,
operations and cash flows for the period, in conformity with IFRS.
Consolidation
The consolidated financial statements include the financial statements of the Company and its
subsidiaries and associated undertakings. All consolidated subsidiaries have a reporting date of 31
December.
Subsidiaries are all entities over which Orogen plc has the power to govern the financial and operating
policies generally accompanying a shareholding of more than one half of the voting rights. The
existence and effect of potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Group controls another entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the Company. They are de-consolidated
from the date that control ceases.
The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group.
The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued
and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the
acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the acquisition date, irrespective of the
extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s
share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less
than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in
the income statement.
Inter-company transactions, balances and unrealised gains on transactions between Group
companies are eliminated. Unrealised losses are also eliminated but considered an impairment
indicator of the asset transferred. Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the Group.
Comparative Information
There have been a number of developments which have changed the presentation of the
comparative information and these are summarised as follows:
Orogen plc (formerly Orogen Gold plc)
P a g e | 21
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
- On 8 September 2016, a liquidation process commenced for Deli Jovan Exploration d.o.o. a 60%
owned Serbian subsidiary of the Company. All results and cash flows of the subsidiary for the
year ended 31 December 2015 have been reclassified as discontinued.
- Orogen Gold (Serbia) Limited holds the Group’s 60% interest in Deli Jovan Exploration d.o.o. It
doesn’t have any other activities. All results and cash flows of the subsidiary for the year ended
31 December 2015 have been reclassified as discontinued.
- The segmental information for 31 December 2015 has been restated to include the above
changes within discontinued operations.
Except as indicated above, the Group financial statements have been prepared on a basis
consistent with that reported for the year ended 31 December 2015.
Functional and presentation currency
Items included in the financial statements of the Group are measured using the currency of the
primary economic environment in which the entity operates (the functional currency). The financial
statements are presented in Pounds Sterling (£), which is the Group’s presentation currency and the
Company’s functional currency.
Foreign currency transactions are translated into the functional currency using exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year-end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in the income statement.
The results and financial position of all Group entities (none of which has the currency of a hyper-
inflationary economy) that have a functional currency different from the presentation currency are
translated into the presentation currency as follows:
• assets and liabilities for each statement of financial position presented are translated at the
•
closing rate at the date of that statement of financial position;
income and expenses for each income statement are translated at average exchange rates
(unless this average is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at the
rate on the dates of the transactions); and
• all resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign
operations, and of borrowings and other currency instruments designated as hedges of such
investments, are taken to shareholders’ equity. When a foreign operation is partially disposed of or
sold, exchange differences that were recorded in equity are recognised in the income statement as
part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets
and liabilities of the foreign entity and translated at the closing rate.
Changes in accounting policies and disclosures
The accounting policies adopted are consistent with those of the previous financial period. New
standards and amendments to IFRS effective as of 1 January 2016 have been reviewed by the Group.
These standards and amendments principally relate to clarifications and presentation and there has
been no material impact on the financial statements as a result. The new standards include:
• Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation
and Amortisation
• Amendments to IFRSs: Annual Improvements 2012-2014 Cycle
Orogen plc (formerly Orogen Gold plc)
P a g e | 22
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
• Disclosure Initiative (Amendments to IAS1)
• Amendment to IAS27: Equity Methods in Separate Financial Statements
• Amendment to IFRS 11: Accounting for Acquisitions of Interest in Joint Ventures
• Clarification of Acceptable Methods of Depreciation and Amortisation: Disclosure Initiative
• Amendments to IFRS 10, IFRS 12 and IAS 28: Investment Entities: Applying the
Consolidation Exception.
Standards issued but not yet effective
There were a number of standards and interpretations which were in issue at 31 December 2016 but
were not effective at 31 December 2016 and have not been adopted for these Financial Statements.
The Directors have assessed the impact of these accounting changes on the Company.
The new standards include:
IFRS 9
IFRS 15
IFRS 16
Improvements to IFRSs
Amendments to IAS 40
Amendments to IAS 12
Amendments to IAS 7
Clarifications to IFRS 15
Amendments to IFRS 2
IFRIC 23
IFRIC 22
Financial Instruments 2
Revenue from Contracts with Customers 2
Leases3
Annual Improvements 2014-2016 Cycle 2, 3
Transfers of Investment Property 2
Recognition of deferred tax assets for unrealised losses 1
Disclosure Initiative 1
Revenue from Contracts with Customers 2
Classification and Measurement of Share-based Payment
Transactions 2
Uncertainty over Income Tax Treatments 3
Foreign Currency Transactions and Advance Consideration 2
1 Effective for annual periods beginning on or after 1 January 2017
2 Effective for annual periods beginning on or after 1 January 2018
3 Effective for annual periods beginning on or after 1 January 2019
Critical accounting judgements and key sources of estimation uncertainty
The preparation of Financial Statements in conformity with IFRS requires management to make
estimates and judgements that affect the reported amounts of assets and liabilities as well as the
disclosure of contingent assets and liabilities at the period end and the reported amounts of revenues
and expenses during the reporting period. Estimates and judgements are continually evaluated and
are based on historical experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
The Group’s accounting policy descriptions set out the areas that involve significant estimation,
uncertainty and critical judgement. The most significant of which are exploration and evaluation
expenditure, business combinations and impairment of intangible assets and investments.
Principal accounting policies
The principal accounting policies are summarised below. They have been consistently applied
throughout the period covered by the Financial Statements.
Business combinations
Business combinations are accounted for using the acquisition method. The cost of an acquisition is
measured as the aggregate of the consideration transferred, measured at acquisition date fair value
and the amount of any non-controlling interest in the acquiree. In the consolidated Financial
Statements, acquisition costs incurred are expensed and included in general and administrative
expenses.
Orogen plc (formerly Orogen Gold plc)
P a g e | 23
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Exploration and evaluation assets
Exploration and evaluation assets are measured using the cost method of recognition. Exploration and
evaluation expenditure is capitalised and recognised as an exploration and evaluation asset when the
rights to an area of interest are current, the expenditures are expected to be recouped through
successful development and exploitation activities and the operations are current and have not
reached such a stage that a reasonable assessment of recoverable reserves can be made.
Exploration and evaluation expenditure includes:
researching, analysing and collating of historical data
• acquisition of rights to explore
•
• exploratory drilling, sampling and trenching
• evaluation of technical feasibility and commercial viability
• administrative and general overheads related to an area of interest
The application of the Group’s accounting policy for exploration and evaluation expenditure requires
judgement in determining whether it is likely that future economic benefits are likely either from
future exploration or sale or where activities have not reached a stage which permits a reasonable
assessment of the existence of reserves. The deferral policy requires management to make certain
estimates and assumptions about future events or circumstances, in particular whether an
economically viable extraction operation can be established. Estimates and assumptions made may
change if new information becomes available. If, after expenditure is capitalised, information becomes
available suggesting that the recovery of expenditure is unlikely, the amount capitalised is written off
in the statement of profit or loss and other comprehensive income in the period when the new
information becomes available.
Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated
impairment losses. Property, plant and equipment comprises office and field equipment and freehold
land. Freehold land is not depreciated. Office and field equipment are depreciated over 3 to 10 years.
Equity
Equity instruments issued by the Company are recorded at the value of the proceeds received, net of
direct issue costs, allocated between share capital and share premium.
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share
of the net identifiable assets of the acquired subsidiary or associate at the date of acquisition.
Goodwill on acquisitions of subsidiaries is included in ‘intangible assets’. Separately recognised
goodwill is tested annually for impairment and carried at cost less accumulated impairment losses.
Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include
the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is
made to those cash-generating units or groups of cash-generating units that are expected to benefit
from the business combination in which the goodwill arose. The Group allocates goodwill to each
business segment in each country in which it operates.
Impairment of non-financial assets
At each statement of financial position date, the Company reviews the carrying amounts of its
investments to determine whether there is any indication that those assets have suffered an
impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in
order to determine the extent of the impairment loss (if any). Where the asset does not generate cash
Orogen plc (formerly Orogen Gold plc)
P a g e | 24
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
flows that are independent from other assets, the Company estimates the recoverable amount of the
cash-generating unit to which the asset belongs. An intangible asset with an indefinite useful life is
tested for impairment annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the
asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount
of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss
is recognised as an expense immediately, unless the relevant asset is carried at a re-valued amount,
in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating
unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that would have been determined had no impairment
loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment
loss is recognised as income immediately, unless the relevant asset is carried at a revalued amount,
in which case the reversal of the impairment loss is treated as a revaluation increase.
Taxation
Income tax
Income tax expense represents the sum of the tax currently payable and deferred tax. The tax
currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported
in the same income statement because it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are never taxable or deductible. The
Group and Company’s liability for current tax is calculated using tax rates that have been enacted or
substantively enacted by the statement of financial position date.
Deferred tax
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit, and
is accounted for using the statement of financial position liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and deferred tax assets are recognised to
the extent that it is probable that taxable profits will be available against which deductible temporary
differences can be utilised. Such assets and liabilities are not recognised if the temporary difference
arises from goodwill or from the initial recognition (other than in a business combination) of other
assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax is reviewed at each statement of financial position date and
reduced to the extent that it is no longer probable that sufficient taxable profits will be available to
allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is
settled or the asset realised. Deferred tax is charged or credited to the income statement, except
when it relates to items charged or credited directly to equity, in which case the deferred tax is also
dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current
tax assets against current tax liabilities and when they relate to income taxes levied by the same
taxation authority and the Group and Company intends to settle its current tax assets and liabilities
Orogen plc (formerly Orogen Gold plc)
P a g e | 25
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
on a net basis.
Share based compensation
The fair value of the employee and suppliers services received in exchange for the grant of the options
is recognised as an expense. The total amount to be expensed over the vesting year is determined by
reference to the fair value of the options granted, excluding the impact of any non-market vesting
conditions (for example, profitability and sales growth targets). Non-market vesting conditions are
included in assumptions about the number of options that are expected to vest. At each statement of
financial position date, the entity revises its estimates of the number of options that are expected to
vest. It recognises the impact of the revision to original estimates, if any, in the income statement,
with a corresponding adjustment to equity.
The proceeds received net of any directly attributable transaction costs are credited to share capital
(nominal value) and share premium when the options are exercised.
The fair value of share based payments recognised in the income statement is measured by use of the
Black Scholes model, which takes into account conditions attached to the vesting and exercise of the
equity instruments. The expected life used in the model is adjusted; based on management’s best
estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.
The share price volatility percentage factor used in the calculation is based on management’s best
estimate of future share price behaviour and is selected based on past experience, future expectations
and benchmarked against peer companies in the industry.
Provisions
Provisions are recognised when the Group and Company has a present obligation as a result of a past
event, and it is probable that the Group and Company will be required to settle that obligation.
Provisions are measured at the Directors’ best estimate of the expenditure required to settle the
obligation at the statement of financial position date, and are discounted to present value where the
effect is material.
Financial instruments
Non-derivative financial instruments comprise investments in equity and debt securities, trade and
other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at
fair value through profit or loss, any directly attributable transactions costs, except as described
below. Subsequent to initial recognition non-derivative financial instruments are measured as
described below.
A financial instrument is recognised when the Group becomes a party to the contractual provisions of
the instrument. Financial assets are derecognised if the Group’s contractual rights to the cash flows
from the financial assets expire or if the Group transfers the financial assets to another party without
retaining control or substantially all risks and rewards of the asset. Regular purchases and sales of
financial assets are accounted for at trade date, i.e. the date that the Group commits itself to purchase
or sell the asset. Financial liabilities are derecognised if the Group’s obligations specified in the
contract expire or are discharged or cancelled.
Fair values
The carrying amounts of the financial assets and liabilities such as cash and cash equivalents,
receivables and payables of the Group and Company at the statement of financial position date
approximated their fair values, due to relatively short term nature of these financial instruments.
Orogen plc (formerly Orogen Gold plc)
P a g e | 26
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Trade payables and other non-derivative financial liabilities
Trade payables and other creditors are non-interest bearing and are measured at cost.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held on call with banks, other short-term
highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank
overdrafts are shown within borrowings in current liabilities on the statement of financial position.
3 Segmental information
In the opinion of the Directors, during the year, the Group had one class of business being the
exploration for, and development and production of gold and other related activities.
The Group's primary reporting format was determined by the geographical segment according to the
location of the exploration asset. At 31 December 2016, there were four geographic reporting
segments: Armenia and USA involved in Gold exploration and development, discontinued operation
in Serbia and the United Kingdom & Ireland being the head and administrative offices.
Segment information of the business for the year ending 31 December 2016 is presented below:
Income statement
General and administrative expenses
Share based payments
Impairment charge
Group operating loss
Finance revenue
Group loss before tax
Assets and liabilities
Segment assets
Segment liabilities
UK & Ireland
£’000
(314)
(20)
—
(334)
3
(331)
371
(124)
247
USA
£’000
—
—
(168)
(168)
—
(168)
—
—
—
Armenia
£’000
(20)
—
(2,515)
(2,535)
—
(2,535)
17
(33)
(16)
Discontinued
operations
£’000
(41)
—
(8)
(49)
—
(49)
—
—
—
Segment information of the business for the year ending 31 December 2015 is presented below:
Income statement
General and administrative expenses
Share based payments
Impairment charge
Group operating loss
Finance revenue
Group loss before tax
Assets and liabilities
Segment assets
Segment liabilities
UK & Ireland
£’000
USA
£’000
Armenia
£’000
Discontinued
operations
£’000
(356)
(5)
—
(361)
5
(356)
940
(47)
893
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
1,577
—
1,577
—
—
(534)
(534)
—
(534)
5
(16)
11
Orogen plc (formerly Orogen Gold plc)
P a g e | 27
Annual Report 2016
Total
£’000
(375)
(20)
(2,691)
(3,086)
3
(3,083)
388
(157)
231
Total
£’000
(356)
(5)
(534)
(895)
5
(890)
2,522
(63)
2,459
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
4 Operating loss
Operating loss is stated after charging/(crediting):
Directors’ emoluments
Services provided by the Company’s auditors:
– Audit fees and expenses
– Tax compliance
– Other services pursuant to legislations
Foreign currency (gain)/loss
5 Finance income
Bank interest received
6 Employees
Aggregate Directors’ emoluments including consulting fees
Wages and salaries
Social security costs
Total
2016
£’000
2015
£’000
125
172
16
2
—
(9)
2016
£’000
3
2016
£’000
125
34
13
172
16
2
—
3
2015
£’000
5
2015
£’000
172
—
—
172
Including the Directors, the Group’s average number of employees during the year was 8 (2015: 5).
Including the Directors, the Company’s average number of employees during the year was 5 (2015: 5).
7 Income tax benefit / (expense)
No corporation tax charge arises in the year ended 31 December 2016 and the year ended 31
December 2015. A reconciliation of the expected tax benefit computed by applying the tax rate
applicable in the primary jurisdiction, the UK, to the loss before tax to the actual tax credit is as follows:
Loss on ordinary activities before taxation
Tax at the UK corporation tax rate of 20%
Expenses not deductible for tax purposes
Losses unutilised
Differences in overseas taxation rates
Tax on loss on ordinary activities
Group
Company
2016
£’000
(3,083)
(617)
539
64
14
—
2015
£’000
(890)
(178)
107
49
22
—
2016
£’000
(2,588)
(518)
477
41
—
—
2015
£’000
(346)
(69)
40
29
—
—
The Group has estimated tax losses of £3,185,000 (2015: £2,798,000) to carry forward against future
taxable profits. The deferred tax asset on these tax losses at 20% amounts to £637,000 (2015:
£560,000) and has not been recognised due to the uncertainty of the recovery. Due to the post year
end fundamental change in the Company’s business following the exit of the mineral exploration
industry, tax losses carried forward may not be fully available for use against the future profits of the
Group.
Orogen plc (formerly Orogen Gold plc)
P a g e | 28
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
8 Loss per share
Basic loss per share is calculated by dividing the loss attributable to equity shareholders by the
weighted average number of ordinary shares in issue during the period:
Loss after tax attributable to equity holders of the parent from
continuing operations (£’000)
Loss after tax attributable to equity holders of the parent from
discontinued operations (£’000)
Loss after tax attributable to equity holders of the parent (£’000)
Weighted average number of ordinary shares in issue
Fully diluted average number of ordinary shares in issue
Basic and diluted loss per share (pence) – continuing operations
Basic and diluted loss per share (pence) – discontinued operations
Basic and diluted loss per share (pence)
2016
(2,560)
2015
(356)
(49)
(321)
(2,609)
(677)
25,702,809 16,007,144
25,702,809 16,007,144
(2.2)
(2.0)
(4.2)
(10.1)
(0.2)
(10.3)
A The ordinary share numbers at 31 December 2016, have been adjusted by a factor of 250 to take into account the 250 to
1 share consolidation that took place on 7 April 2017.
Basic and diluted earnings per share are the same, since where a loss is incurred the effect of
outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of
the loss per share calculation. The share options outstanding as at 31 December 2016 totalled
380,000,000 (2015: 380,000,000) and are potentially dilutive.
9 Exploration and evaluation assets
Cost
At 1 January 2015
Additions
At 31 December 2015
Impairment
At 1 January 2015
Impairment charge
At 31 December 2015
Carrying value 31 December 2015
Cost
At 1 January 2016
Additions
Discontinued operations
At 31 December 2016
Impairment
At 1 January 2016
Impairment charge
Discontinued operations
At 31 December 2016
Carrying value 31 December 2016
GROUP
COMPANY
USA
£’000
Armenia
£’000
Serbia
£’000
Total
£’000
USA
£’000
Total
£’000
—
—
—
—
—
—
—
—
168
—
168
—
168
—
168
—
1,311
266
1,577
—
—
—
1,577
1,577
938
—
2,515
—
2,515
—
2,515
—
5,520
34
5,554
5,020
534
5,554
—
5,554
8
(5,562)
—
5,554
8
(5,562)
—
—
6,831
300
7,131
5,020
534
5,554
1,577
7,131
1,114
(5,562)
2,683
5,554
2,691
(5,562)
2,683
—
—
—
—
—
—
—
—
—
168
—
168
—
168
—
168
—
—
—
—
—
—
—
—
—
168
—
168
—
168
—
168
—
As part of the annual impairment review of asset carrying values a charge of £2,515,000 (2015: nil)
was recorded in relation to the Mutsk project in Armenia.
Orogen plc (formerly Orogen Gold plc)
P a g e | 29
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As part of the annual impairment review of asset carrying values a charge of £168,000 (2015: nil) was
recorded in relation to the Silverton project in USA. During the year, the Company decided to
terminate the Deli Jovan project and relinquish the exploration permit.
Annual Impairment Review
The Group’s policy in relation to exploration and evaluation expenditure is to capitalise the
expenditure when the rights to an area of interest are current, the expenditures are expected to be
recouped through successful development and exploitation activities and the operations are current
and have not reached such a stage that a reasonable assessment of recoverable reserves can be made.
The Company believes that sufficient information was available at the reporting date (including
disappointing exploration results, no substantive expenditure forecast on the assets and a depressed
share price) which suggested that the recovery of expenditure on the Mutsk and Silverton areas of
interest was unlikely, therefore the amounts which were capitalised in respect of these assets were
written off to the statement of comprehensive income.
After year end, at a General Meeting of the Company on 7 April 2017, shareholders approved a change
of strategy and an exit from mineral exploration. The Company has decided to cap further expenditure
on its existing mineral exploration projects at £75,000 and to put them on care and maintenance
programmes whilst buyers are sought for the Company's interests in these assets.
As a result of the above the Directors determined that there were facts and circumstances which
indicated at year end that the Group’s assets were impaired and accordingly the assets were written
off. The actions undertaken by the Company since the year end reflect the resulting impact of the
underlying issues which had begun to affect the Group prior to the year end.
10 Business combinations and non-controlling interests
Acquisition of Georaid CJSC
On 31 August 2016, the Group earned a 80% interest in the Armenia company Georaid CJSC following
the completion of US$2.5 million (£1,907,000) exploration financing of the Mutsk gold project. At the
date of acquisition non-controlling interests have been measured at their proportionate interest in
the book values of the subsidiary net assets as adjusted for the accounting policies of the Group (the
total subsidiary net assets after accounting policy and fair value adjustments was £2,384,000).
Assets acquired and liabilities assumed:
Assets
Exploration and evaluation assets (see note below)
Cash and cash equivalents
Trade and other receivables
Total assets
Liabilities
Trade and other payables
Total liabilities
Total net assets
Non-controlling interest
Purchase consideration
At date of
acquisition
£’000
2,390
11
18
2,419
35
35
2,384
477
1,907
Orogen plc (formerly Orogen Gold plc)
P a g e | 30
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
At the acquisition date a fair value uplift was made to the exploration and evaluation assets, which
resulted in a total value of £2,390,000 at the acquisition date, to reflect the value of the Group’s
investment in the Mutsk gold project.
An additional £125,000 of exploration expenditure was incurred to 31 December 2016 on the Mutsk
gold project after the 80% earn-in date. As the Company’s partners on the project have not
contributed to this expenditure as is required to maintain their 20% interest in the project, Orogen’s
interest in the project increased to approximately 82% by the year end. Shares in Georaid CJSC for the
increased interest in the project have not yet been issued to Orogen.
11 Discontinued operations
Serbian gold exploration operations
On 8 September 2016, a liquidation process commenced for Deli Jovan Exploration d.o.o. a 60% owned
Serbian subsidiary of the Company. All results and cash flows of the subsidiary for the year ended 31
December 2015 have been reclassified as discontinued.
Orogen Gold (Serbia) Limited holds the Group’s 60% interest in Deli Jovan Exploration d.o.o. It doesn’t
have any other activities. All results and cash flows of the subsidiary for the year ended 31 December
2015 have been reclassified as discontinued.
Armenia and USA gold exploration operations
On 21 March 2017, the Company announced its proposals to dispose of the Company's mineral
exploration interests and change the Company's business strategy. At a general meeting on the 7 April
2017, the Company’s shareholders approved resolutions for a change of strategy resulting in the
Company being classified as an AIM Rule 15 cash shell. The Company has decided to cap further
expenditure on its existing mineral exploration projects at £75,000 and to put them on care and
maintenance programmes whilst buyers are sought for the Company's interests in these assets. The
Board does not believe that all the conditions to classify the Armenian and USA gold exploration
operations as discontinued and available for sale were met at 31 December 2016. Therefore, these
operations have been included as continuing at 31 December 2016.
Results for discontinued operations:
As indicated above, the liquidation process for Deli Jovan Exploration d.o.o. commenced in 2016. As a
consequence of this, the results and cash flows of the subsidiary and its holding Company, Orogen Gold
(Serbia) Limited, for the year ended 31 December 2015 have been reclassified as discontinued.
Revenue
General and administrative costs
Impairment charges
Loss on discontinued operations before tax
Tax
Loss for the period from discontinued operations
Group
Company
2016
£’000
—
(41)
(8)
(49)
—
(49)
2015
£’000
—
—
(534)
(534)
—
(534)
2016
£’000
3
(66)
—
(63)
—
(63)
2015
£’000
11
—
(200)
(189)
—
(189)
Orogen plc (formerly Orogen Gold plc)
P a g e | 31
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Loss per share from discontinued operations:
Loss per share from discontinued operations:
Basic and diluted A
2016
Pence
2015
Pence
(0.2)
(2.0)
A The share number used in the LPS calculation is the post period end share consolidation amount – see note 16 for details.
The net cash flows incurred are as follows:
Operating
Investing
Financing
Net cash (outflow)/inflow
12 Property, plant and equipment - Group
Cost
At 1 January 2015
Additions
At 31 December 2015
Accumulated depreciation
At 1 January 2015
Additions
At 31 December 2015
Carrying value 31 December 2015
Cost
At 1 January 2016
Discontinued operations
At 31 December 2016
Accumulated depreciation
At 1 January 2016
Discontinued operations
At 31 December 2016
Carrying value 31 December 2016
Group
2016
£’000
(11)
(4)
—
(15)
2015
£’000
(14)
(26)
—
(40)
Freehold
Land
£’000
Office and
Field
Equipment
£’000
Total
£’000
2
—
2
—
—
—
2
2
(2)
—
—
—
—
—
2
—
2
1
1
2
—
2
(2)
—
2
(2)
—
—
4
—
4
1
1
2
2
4
(4)
—
2
(2)
—
—
Orogen plc (formerly Orogen Gold plc)
P a g e | 32
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13 Non-current assets
Investments in subsidiaries and associates:
Cost as at 1 January
Additions
Cost at 31 December
Impairment as at 1 January
Impairment charge
Impairment at 31 December
Carrying value as at 31 December
Break down of carrying value of investment:
Emotion Fitness Mag Kft – investment
Emotion Fitness Mag Kft -impairment
Medavinci Gold Limited - investment
Medavinci Gold Limited - impairment
Investments
Medavinci Gold Limited – loan
Medavinci Gold Limited – loan provision
Loans to subsidiaries
Total non-current assets
Group
Company
2016
£’000
—
—
—
—
—
—
—
2015
£’000
—
—
—
—
—
—
—
2016
£’000
9,102
234
9,336
7,039
2,197
9,236
100
2015
£’000
8,689
413
9,102
6,839
200
7,039
2,063
Group
Company
2016
£’000
—
—
—
—
—
—
—
—
—
2015
£’000
339
(339)
—
—
—
—
—
—
—
2016
£’000
—
—
3,370
(3,370)
—
5,627
(5,527)
100
100
2015
£’000
339
(339)
3,370
(3,370)
—
5,393
(3,330)
2,063
2,063
As part of the annual impairment review of asset carrying values a charge of £2,197,000 (2015:
£200,000) was recorded in relation to the Company’s intercompany receivable from Medavinci Gold
Limited. This follows the review of the carrying value of all exploration assets (see note 9). Medavinci
Gold Limited operates as a holding company of Orogen Gold Limited an Irish registered company with
gold exploration interests in Armenia.
Emotion Fitness Mag Kft
The Group's investment in Emotion Fitness Mag Kft (a Hungarian registered company) represents a
47% interest in that company. Emotion Fitness Mag Kft discontinued the operation of a fitness centre
from its Budapest premises in 2011. The Directors consider it is unlikely that the Company will recover
any value from this investment and accordingly have fully impaired the value of the investment.
Subsidiary companies
Deli Jovan Exploration d.o.o.
Medavinci Gold Limited
Emotion Fitness Limited
Orogen Gold Limited
Orogen Gold (Serbia) Limited
Orogen Gold (Armenia) Limited
Georaid CJSC
1 Percentage of share type held and overall voting rights
Incorporation
Serbia
UK
UK
Ireland
Ireland
Ireland
Armenia
Holding
Indirect
Direct
Direct
Indirect
Indirect
Indirect
Indirect
Type of share held
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
%
Holding1
2016
—
100
100
100
100
100
80
%
Holding1
2015
60
100
100
100
100
100
—
Orogen plc (formerly Orogen Gold plc)
P a g e | 33
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
List of registered offices:
Company
Deli Jovan Exploration d.o.o.
Medavinci Gold Limited
Emotion Fitness Limited
Orogen Gold Limited
Orogen Gold (Serbia) Limited
Orogen Gold (Armenia) Limited
Georaid CJSC
Registered Office Address
Ustanička 128 a, Beograd-Voždovac
Finsgate, 5-7 Cranwood Street, London, EC1V 9EE
Finsgate, 5-7 Cranwood Street, London, EC1V 9EE
18 Fitzwilliam Place, Dublin 2
18 Fitzwilliam Place, Dublin 2
18 Fitzwilliam Place, Dublin 2
8H.Qochar,apt.16, Yerevan
14 Trade and other receivables
VAT recoverable
Other receivables and prepayments
Receivables from Group Companies
Trade and other receivables
Group
Company
2016
£’000
15
31
—
46
2015
£’000
16
6
—
22
2016
£’000
10
22
30
62
2015
£’000
5
4
52
61
The Directors consider that the carrying amount of trade and other receivables approximates their
fair value.
15 Cash and cash equivalents
Cash at bank
Cash and cash equivalents
Group
Company
2016
£’000
342
342
2015
£’000
921
921
2016
£’000
64
64
2015
£’000
301
301
16 Share capital
Details of ordinary shares issued are in the table below:
Ordinary Shares (£0.001)
Date
At 1 Jan 2015
27 Jan 2015
25 Mar 2015
30 Oct 2015
At 31 Dec 2015
9 Aug 2016
At 31 Dec 2016
Details
Opening Balance
Mutsk continuation notice
Drill for equity agreement
Share placing - £450,000
Share placing - £350,000
Number of shares
3,560,432,183
110,886,804
36,350,350
1,800,000,000
5,507,669,337
2,333,333,333
7,841,002,670
Issue Price
£
0.000597
0.002
0.00025
0.00015
Total
Share
Capital
£’000
356
11
4
180
551
233
784
Total
Share
Premium
£’000
11,827
55
69
230
12,181
87
12,268
Details of deferred shares issued are in the table below:
Deferred Shares (£0.009)
Date
At 1 Jan 2015, 31 Dec 2015 and 31 Dec 2016
Number of
shares
429,643,035
Total Share
Capital
£’000
3,867
Total Share
Premium
£’000
—
Orogen plc (formerly Orogen Gold plc)
P a g e | 34
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
On 7 April 2017, every 250 existing ordinary shares of par value 0.01p in the Company at close of
business on 7 April 2017 became 1 new ordinary share of par value 0.01p and 249 new deferred shares
of par value 0.01p. The rights attaching to the new ordinary shares of 0.01p will be identical in all
respects to those of the old ordinary shares of 0.01p.
Similar to the old deferred shares of 0.9p each, the new deferred shares of 0.01p created are
effectively valueless as they will not carry any rights to vote or dividend rights. In addition, holders of
deferred shares will only be entitled to a payment on a return of capital or on a winding up of the
Company after each of the holders of new ordinary shares of 0.01p each have received a payment of
£10,000,000 on each such share. The new deferred shares are not and will not be listed or traded on
AIM or any other investment exchange and are only transferable in limited circumstances.
17 Share based payments
The Group has a share ownership compensation scheme for senior executives of the Group. In
accordance with the provisions of the plan, as approved by shareholders at a previous general
meeting, senior executives may be granted options to purchase ordinary shares in the Company.
The Group has on occasion issued warrants, or share options to third parties by way of settlement of
liabilities to strategic suppliers and consultants. Each share option converts into one ordinary share of
Orogen plc upon exercise. No amounts are paid or payable by the recipient of the option for the
option. The options carry neither rights to dividends nor voting rights at shareholders meetings.
2016
2015
Number of share options
380,000,000
Balance at 1 January
—
Lapsed during the year
—
Issued during the year
Balance at 31 December B
380,000,000
200,000,000
Exercisable at 31 December
A See note 16 in relation to the post year end share reorganisation. All existing rights attached to share options were
amended to reflect the new share structure. The rights are now over new ordinary shares of 0.01p, with the original units
divided by a factor of 250 and the original exercise price increased by a factor of 250.
B 300,000,000 of these options lapsed on 7 April 2017 following the board changes that were effective on that date as a
result of the change of company strategy.
Number of share
options
225,000,000
(25,000,000)
180,000,000
380,000,000
200,000,000
Weighted
average exercise
price
0.369p
—
—
0.369p
0.60p
Weighted average
exercise price
0.68p
0.80p
0.035p
0.369p
0.60p
The fair value of equity based share options granted is estimated at the date of grant using the Black-
Scholes pricing model, taking into account the terms and conditions upon which the options have been
granted. The calculated fair value of share options and warrants charged to the Group and Company
financial statements in the year is £20,000 (2015: £5,000). The total fair value of the share options
granted during 2015 is £41,000.
The following are the inputs to the model for the options granted during the prior year:
Strike price
Total units
Underlying asset price
Time (days)
Volatility
Interest rate p.a.
Share Options
2015
0.035p
180,000,000
0.035p
2,555
110%
1.25%
A See note 16 in relation to the post year end share reorganisation.
Orogen plc (formerly Orogen Gold plc)
P a g e | 35
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
18 Retained earnings
Opening balance
Loss for the year
Transfer from share based payment reserve
Closing balance
Group
Company
2016
£’000
(14,765)
(2,609)
7
(17,367)
2015
£’000
(14,088)
(677)
—
(14,765)
2016
£’000
(14,860)
(2,588)
7
(17,441)
2015
£’000
(14,514)
(346)
—
(14,860)
In accordance with the provisions of the Companies Act 2006, the Company has not presented a
statement of profit or loss and other comprehensive income. The Company's loss for the year was
£2,588,000 (2015: loss £346,000).
19 Trade and other payables
Trade payables
Accruals and deferred income
Amounts due to Directors
Payable to Group Companies
Trade and other payables
Group
Company
2016
£’000
15
126
16
—
157
2015
£’000
8
42
13
—
63
2016
£’000
13
93
8
24
138
2015
£’000
6
36
8
39
89
Amounts due to Directors are unsecured, interest free and are current liabilities.
20 Related party transactions
See the Directors report for details of remuneration of Directors.
Shares purchased by Directors
Shares in Orogen plc were acquired by the Directors of the Company as part of share placings as
follows:
Colin Bird
Adam Reynolds
Ed Slowey
Alan Mooney
Michael Nolan
Total
Subscription shares
October 2015
100,000,000
25,000,000
25,000,000
25,000,000
25,000,000
200,000,000
A See note 16 in relation to the post year end share reorganisation.
There were no shares purchased via share placings by directors during 2016.
Other transactions with Directors
The following amounts were charged during the year to the Company by entities related to the
Directors:
Office facilities and administration
Total
2016
£’000
10
10
2015
£’000
9
9
Orogen plc (formerly Orogen Gold plc)
P a g e | 36
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Office facilities and administration costs include £10,000 (2015: £9,000) in relation to office licence
fees. The office licence fees were charged on an arm’s length basis.
Silverton Agreement with Galileo Resource plc (“Galileo”)
In June 2016, Orogen executed an earn-in agreement with Galileo covering the Silverton gold-silver
property in Nevada, USA (“Silverton”). Under the earn-in agreement Orogen secured the right to earn-
in to an initial 51% interest in Silverton by spending US$400,000 within 18 months and thereafter the
possibility to spend an additional US$1,500,000 within 30 months to earn-in a further 24% interest. At
the time of the transaction, Colin Bird was a director of both Galileo and Orogen and had shareholdings
of 24.81% and 1.82% respectively.
Parent transactions with Group companies
During the year the Company advanced £234,000 (2015: £413,000) to Medavinci Gold Limited by way
of intercompany loans for exploration activities. The balance outstanding from Medavinci Gold
Limited at 31 December 2016 is £5,627,000 (2015: £5,393,000). The Company made a provision of
£2,197,000 (2015: £200,000) against this receivable in the current year (see note 13). The
intercompany loans are interest free and unsecured.
As at the 31 December 2016 the Company had trade receivable balances of £30,000 (2015: £51,000)
with Orogen Gold (Armenia) Limited and nil (2015: £1,000) with Orogen Gold (Serbia) Limited.
Intercompany trade receivable balances are payable within 30 days of the invoice date. The
Company’s total intercompany income for the year was £144,000 (2015: £181,000).
As at the 31 December 2016 the Company had a trade payable balance of £24,000 (2015: £39,000)
with Orogen Gold Limited. Intercompany trade payable balances are payable within 30 days of the
invoice date. The Company’s total intercompany recharges incurred for the year was £106,000 (2015:
£150,000).
21 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.
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group’s risk management objectives
and policies and, whilst retaining responsibility for them it has delegated the authority for designing
and operating processes that ensure the effective implementation of the objectives and policies to
the Group’s finance function. The Board receives regular updates from the management team
through which it reviews the effectiveness of the processes put in place and the appropriateness of
the objectives and policies it sets. The overall objective of the Board is to set policies that seek to
reduce risk as far as possible without unduly affecting the Group’s competitiveness and flexibility. The
Company’s operations expose it to some financial risks arising from its use of financial instruments,
the most significant ones being cash flow interest rate risk, foreign exchange risk, liquidity risk and
capital risk. Further details regarding these policies are set out below:
Orogen plc (formerly Orogen Gold plc)
P a g e | 37
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Cash flow interest rate risk
The Group is exposed to cash flow interest rate risk from its deposits of cash and cash equivalents with
banks. The cash balances maintained by the Group are proactively managed in order to ensure that
attractive rates of interest are received for the available funds but without affecting the working
capital flexibility the Group requires. The Group is not at present exposed to cash flow interest rate
risk on borrowings as it has no debt. No subsidiary company of the Group is permitted to enter into
any borrowing facility or lease agreement without the prior consent of the Company.
Interest rates on financial assets
The Group’s financial assets consist of cash and cash equivalents, loans, trade and other receivables.
The interest rate profile of these assets was as follows:
31 December 2016
UK Sterling
Euro
US Dollar
Other currencies
31 December 2015
UK Sterling
Euro
US Dollar
Other currencies
Total
£’000
Financial assets on which
interest is earned
£’000
Financial assets on which
interest in not earned
£’000
264
29
88
7
388
897
25
19
2
943
184
—
61
1
246
588
—
19
—
607
80
29
27
6
142
309
25
—
2
336
The Group earned interest on its interest bearing financial assets at rates between 0.05% and 0.75%
(2015: 0.05% and 0.9%) during the year.
A change in interest rates on the statement of financial position date would increase/ (decrease) the
equity and the anticipated annual income or loss by the theoretical amounts presented below. The
analysis is made on the assumption that the rest of the variables remain constant. The analysis with
respect to 31 December 2015 was prepared under the same assumptions.
Instruments bearing interest
2016
2015
Increase in
1%
£’000
7
Decrease of
1%
£’000
(7)
Increase in
1%
£’000
6
Decrease of
1%
£’000
(6)
It is considered that there have been no significant changes in cash flow interest rate risk at the
reporting date compared to the previous year end and that therefore this risk has had no material
impact on earnings or shareholders’ equity.
Foreign exchange risk
Foreign exchange risk may arise because the Group has operations located in various parts of the
world where the local currency is not the same as the functional currency in which the Company
operates.
Only in exceptional circumstances will the Group consider hedging its net investments in overseas
operations, as generally it does not consider that the reduction in foreign currency exposure warrants
Orogen plc (formerly Orogen Gold plc)
P a g e | 38
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
the cash flow risk created from such hedging techniques. It is the Group’s policy to ensure that
individual Group entities enter into local transactions in their functional currency wherever possible
and that surplus funds over and above immediate working capital requirements are held in Sterling
deposits.
The Group considers this policy minimises any unnecessary foreign exchange exposure. In order to
monitor the continuing effectiveness of this policy the Board through their approval of both corporate
and capital expenditure budgets and review of the currency profile of cash balances and management
accounts, considers the effectiveness of the policy on an on-going basis.
The following table discloses the major exchange rates of those currencies utilised by the Group:
Foreign currency units to £1 UK Sterling (rounded)
Average 2016
At 31 December 2016
Average 2015
At 31 December 2015
(EUR = Euro and USD = United States Dollar)
EUR
1.225
1.174
1.374
1.357
USD
1.351
1.235
1.528
1.480
Liquidity risk
Liquidity risk arises from the Group’s management of working capital; it is the risk that the Group will
encounter difficulty in meeting its financial obligations as they fall due. The principal obligations of the
Group arise in respect of committed expenditure in respect of its on-going exploration work. The
Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its obligations
when they become due. To achieve this aim, it seeks to maintain readily available cash balances (or
agreed facilities) to meet expected requirements and to raise new equity finance to meet the next
phase of exploration and where relevant development expenditure.
The Board receives cash flow projections on a monthly basis as well as information on cash balances.
The Board will not commit to material expenditure in respect of its on-going exploration work prior to
being satisfied that sufficient funding is available to the Group to finance the planned programmes.
For cash and cash equivalents, the Company only uses recognised banks with medium to high credit
ratings.
Capital risk
The Group’s objectives when managing capital are to safeguard the ability to continue as a going
concern in order to provide returns for shareholders and benefits to other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital.
22 Capital commitments and contingencies
Capital Commitments
Following the approval of the change in strategy on 7 April 2017, Orogen will withdraw from mineral
exploration and will not commit further substantial expenditure on its exploration assets in the
meantime. All costs incurred to 31 December 2016 in respect of the Company’s work programmes
have been accrued for. Going forward the Group has liabilities in respect of general overheads in
relation to its exploration projects, £50,000 in the period to 7 April 2017, and has decided to cap
further expenditure, after the change of strategy date, on its mineral exploration projects at £75,000
whilst buyers are sought for the Company’s interest in these assets. The Company estimates that total
future costs in relation to mineral exploration after 31 December 2016 should not exceed £125,000 in
aggregate.
Orogen plc (formerly Orogen Gold plc)
P a g e | 39
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Contingent liabilities
Georaid CJSC (“Georaid”) Mutsk Gold Project Joint Venture Agreement
Under the Joint Venture Agreement with Georaid if a positive bankable feasibility study is obtained
on the Mutsk gold project, then Orogen will issue ordinary shares in the Company to the former
Georaid principals to the value of US$300,000. The US$300,000 share based payment is contingent on
the Company (1) exercising its option to acquire an 80% interest in the project (this option was
exercised in August 2016); (2) the project partners undertaking further substantial exploration work
on the project and (3) a feasibility study being commissioned which is both positive in its outcome and
bankable.
23 Events after the reporting period
Change of Name and Strategy
On 7 April 2017 at a general meeting of the Company, Orogen shareholders voted to adopt resolutions
to effect a change of strategy and to change the name of the Company from Orogen Gold plc to Orogen
plc. Trading on AIM commenced under the new Company name on 10 April 2017.
The decision to cease the Company's mineral exploration activities represents a fundamental change
of business under Rule 15 of the AIM Rules. The Company is deemed to be an AIM Rule 15 cash shell,
which means that the Company must make an acquisition or acquisitions which constitute a reverse
takeover under Rule 14 of the AIM Rules within six months of the 7 April 2017 general meeting,
otherwise the trading of the Company's shares on AIM will be suspended. If the Company has not
made an acquisition or acquisitions which constitute a reverse takeover under Rule 14 of the AIM
Rules within six months of such suspension, the admission of the Company's shares to trading on AIM
will be cancelled.
Capital Restructuring and Issue of Shares
On 7 April 2017, every 250 existing ordinary shares of par value 0.01p in the Company at close of
business on 7 April 2017 became 1 new ordinary share of par value 0.01p and 249 new deferred shares
of par value 0.01p. The rights attaching to the new ordinary shares of 0.01p will be identical in all
respects to those of the old ordinary shares of 0.01p.
On 7 April 2017 the Company raised gross proceeds of approximately £3.47 million, through an open
offer, placing and second placing which added 231,364,011 ordinary shares to the 31,364,011 ordinary
shares in existence after the capital reorganisation.
Directorate Changes
Following the general meeting on 7 April 2017, Colin Bird, Edward Slowey, Michael Nolan and Alan
Mooney resigned from the Board and Steven Metcalfe and Mark Collingbourne were appointed as
directors of the Company with immediate effect.
Issue of Equity
On 3 May 2017, the Company issued 2,000,000 new ordinary shares of 0.01p at 1.5p in settlement
of professional fees. Following the issue of the new ordinary shares, the total number of ordinary
shares in issue is 264,728,022.
Silverton Agreement Withdrawal
On 8 May 2017, Orogen issued formal notice to Galileo Resources plc of its withdrawal from the
Silverton Agreement. As permitted under the agreement, Orogen has withdrawn without recourse
with all interests in the Silverton property reverting back to Galileo.
Orogen plc (formerly Orogen Gold plc)
P a g e | 40
Annual Report 2016
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Suspension, Loan and Potential Acquisition
On the 26 May 2017, the Company announced that it had agreed heads of terms with Thread 35
Limited ("Thread") to acquire Thread's entire issued share capital, subject to certain conditions and
due diligence. Thread operates an e-commerce womenswear brand under the brand name
the AIM
"Sosandar". This acquisition would constitute a
Rules. Consequently, the Company has requested that trading in its shares is temporarily suspended,
pending either the publication of an admission document or until the proposed acquisition
negotiations are terminated.
transaction under
reverse
As part of the proposed transaction Orogen has made a secured loan of up to £250,000 ("Loan") to
Thread. The Loan is interest free and may be drawn down in two tranches. The first tranche of
£100,000 may be drawn down immediately, whilst the second tranche may only be drawn down on
the condition that letters of intent are obtained by the Company from Thread's shareholders to accept
the terms of an offer to acquire their shares. On 14 June 2017, the second tranche of the Loan was
drawn down.
Orogen plc (formerly Orogen Gold plc)
P a g e | 41
Annual Report 2016
COMPANY INFORMATION
WEBSITE: WWW.OROGEN.CO.UK
Registered office
Finsgate
5-7 Cranwood Street
London EC1V 9EE
Registered number
5379931, England and Wales
Directors
Secretary
Auditors
Nominated advisor
Broker
Registrars
Solicitors
Public Relations
Adam Reynolds – Non-executive Chairman
Steven Metcalfe – Non-executive Director
Mark Collingbourne – Non-executive Director
Mark Collingbourne
Jeffreys Henry LLP
Finsgate
5-7 Cranwood Street
London EC1V 9EE
Cairn Financial Advisers LLP
Cheyne House
Crown Court
62-63 Cheapside
London EC2V 6AX
Turner Pope Investments
6th Floor, Becket House
36 Old Jewry
London EC2R 8DD
Capita Asset Services
The Registry, 34 Beckenham Road
Beckenham
Kent BR3 4TU
BPE Solicitors LLP
St. James’ House
St. James’ Square
Cheltenham GL50 3PR
Walbrook PR Limited
4 Lombard Street
London EC3V 9HD
Orogen plc (formerly Orogen Gold plc)
P a g e | 42
Annual Report 2016
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the Annual General Meeting (“Meeting”) of Orogen plc (“the Company”)
will be held at Finsgate, 5-7 Cranwood Street, London EC1V 9EE on 27 July 2017 at 4pm for the
following purposes:
ORDINARY BUSINESS
1. To receive and adopt the report of the Directors and the financial statements of the Company for
the year ending 31 December 2016, together with the report of the auditors thereon. (Ordinary
Resolution)
2. To re-elect Adam Reynolds as a Director of the Company in accordance with the Company’s articles
of association. (Ordinary Resolution)
3. To re-elect Steven Metcalfe as a Director of the Company in accordance with the Company’s articles
of association. (Ordinary Resolution)
4. To re-elect Mark Collingbourne as a Director of the Company in accordance with the Company’s
articles of association. (Ordinary Resolution)
5. To re-appoint Jeffreys Henry LLP as auditors of the Company and to authorize the Directors to fix
their remuneration. (Ordinary Resolution)
SPECIAL BUSINESS
To consider and, if thought fit, to pass the following resolutions which will be proposed as an ordinary
resolution as to resolution 6 and as a special resolution as to resolution 7:
6. THAT the Directors be and they are hereby generally and unconditionally authorised in accordance
with section 551 of the Companies Act 2006 (“Act”) to exercise all and any powers of the Company to
allot shares in the Company or grant rights to subscribe for or to convert any securities into shares in
the Company (“Rights”) up to an aggregate nominal amount of £26,472, provided that the authority
hereby conferred shall operate in substitution for and to the exclusion of any previous authority given
to the Directors pursuant to section 551 of the Act and shall expire on the date falling 12 months from
the date of the passing of this resolution (or, if later, the next annual general meeting of the Company
following the passing of this resolution) unless such authority is renewed, varied or revoked by the
Company in general meeting save that the Company may at any time before such expiry make an offer
or agreement which might require shares to be allotted or Rights to be granted after such expiry and
the Directors may allot shares or grant Rights in pursuance of such offer or agreement as if the
authority hereby conferred had not expired. (Ordinary Resolution)
7. THAT subject to and conditional upon passing of resolution 6 the Directors 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) for cash as if section 561 (1) of the Act did not apply to any such allotment PROVIDED THAT
such power shall be limited to:
Orogen plc (formerly Orogen Gold plc)
P a g e | 43
Annual Report 2016
NOTICE OF ANNUAL GENERAL MEETING
a. the allotment of equity securities in connection with a rights issue or any other pre-emptive offer
in favour of holders of equity securities (as required by the rights of such securities) in proportion (as
nearly as may be) to the respective amounts of equity securities held by them subject only to such
exclusions or other arrangements as the Directors may consider appropriate to deal with treasury
shares, fractional entitlements, record dates or legal or practical difficulties under the laws of any
territory or the requirements of any recognised regulatory body or stock exchange in any territory or
otherwise;
b. the allotment (otherwise than pursuant to sub paragraph (a) above) of equity securities up to an
aggregate nominal amount of £13,236,
and the power hereby conferred shall operate in substitution for and to the exclusion of any previous
power given to the Directors pursuant to section 561 (1) of the Act and shall expire on the date falling
12 months from the date of the passing of this resolution (or, if later, the next annual general meeting
of the Company following the passing of this resolution) unless such power is renewed, varied or
revoked by the Company in general meeting except that the Company may before the expiry of any
power contained in this Resolution 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. (Special Resolution)
By Order of the Board
Mark Collingbourne
Company Secretary
Orogen plc
Finsgate
5 – 7 Cranwood Street
London EC1V 9EE
Date: 28 June 2017
Orogen plc (formerly Orogen Gold plc)
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Annual Report 2016
NOTICE OF ANNUAL GENERAL MEETING
NOTES:
Entitlement to attend and vote
1
In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001, the Company gives
notice that only those shareholders entered on the relevant register of members (Register) for
certificated or uncertificated shares of the Company (as the case may be) at close of business on 25 July
2017 (Specified Time) will be entitled to attend or vote at the Annual General Meeting in respect of the
number of shares registered in their name at that time. Changes to entries on the Register after the
Specified Time will be disregarded in determining the rights of any person to attend or vote at the Annual
General Meeting. Should the Annual General Meeting be adjourned to a time not more than 48 hours after
the Specified Time, that time will also apply for the purpose of determining the entitlement of members
to attend and vote (and for the purpose of determining the number of votes they may cast) at the
adjourned Annual General Meeting. Should the Annual General Meeting be adjourned for a longer period,
then to be so entitled, members must be entered on the Register at the time which is 48 hours before
the time fixed for the adjourned Annual General Meeting or, if the Company gives notice of the adjourned
Annual General Meeting, at the time specified in the notice.
Appointment of proxies
2 As a member of the Company, 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 or via CREST 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.
If you do not give your proxy an indication of how to vote on any resolution, 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.
4
Appointment of proxy using hard copy Proxy Form
5
The notes to the Proxy Form explain how to direct your proxy 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 Capita Asset Services at PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU; and
- received by Capita Asset Services no later than 4pm on 25 July 2017.
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.
6
7
8 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.
Appointment of proxy by joint members
9
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 Register in respect of the joint holding (the
first-named being the most senior).
Changing proxy instructions
10 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 applies in relation
to amended instructions; any amended proxy appointment received after the relevant cut-off time will
be disregarded.
11 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 Capita Asset Services on 0871 664 0300.
Orogen plc (formerly Orogen Gold plc)
P a g e | 45
Annual Report 2016
NOTICE OF ANNUAL GENERAL MEETING
Calls cost 12p per minute plus your phone company’s access charge. If you are outside the United
Kingdom, please call +44 371 664 0300. Calls outside the United Kingdom will be charged at the applicable
international rate. Capita are open between 09:00-17.30, Monday to Friday excluding public holidays in
England and Wales. Calls may be recorded and randomly monitored for security and training purposes.
The helpline cannot provide advice on the merits of the resolutions proposed nor give any financial, legal
or tax advice.
12 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
13 In order to revoke a proxy instruction (other than a CREST Proxy instruction) you will need to inform
Capita Asset Services by sending a signed hard copy notice clearly stating your intention to revoke your
proxy appointment to Capita Asset Services at PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU. 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.
14 The revocation notice must be received by Capita Asset Services no later than 9am on 23 May 2017. 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.
15 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.
Appointment of proxy via CREST
16 CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment
service may do so by using the procedures described in the CREST Manual. CREST personal members or
other CREST sponsored members and those CREST members who have appointed 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.
17 In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate
CREST message (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. The message, regardless of whether it constitutes the appointment of a
proxy or 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 Capita Asset Services (ID RA10) by no later than 4pm on 25
July 2017. No such message received through the CREST network after this time will be accepted. 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 registrars are 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.
18 CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note
that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular
message. 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 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 the CREST system 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.
19 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.
Orogen plc (formerly Orogen Gold plc)
P a g e | 46
Annual Report 2016
FORM OF PROXY
I/We the undersigned, being a member/members of Orogen plc (the “Company”), appoint
Name:…………………………………..................................................................................or,
failing him, the Chairman of the meeting, as my/our proxy to vote on my/our behalf at the Annual
General Meeting of the Company (“Meeting”) to be held on 25 July 2017 at 4pm at Finsgate, 5-7
Cranwood Street, London EC1V 9EE and at any adjournment thereof. The proxy will vote on the
under mentioned resolutions, as indicated.
(PLEASE INDICATE WITH AN “X” IN THE BOXES BELOW)
ORDINARY RESOLUTIONS
For
Against
Abstain
1. To receive and adopt the report of the Directors and the
financial statements of the Company for the year ending 31
December 2016 together with the report of the auditors thereon.
2. To re-elect Adam Reynolds as a Director of the Company.
3. To re-elect Steven Metcalfe as a Director of the Company.
4. To re-elect Mark Collingbourne as a Director of the Company.
5. To re-appoint Jeffreys Henry LLP as auditor and to authorise
the Directors to fix their remuneration.
6. To grant the Directors authority to allot shares generally.
7. To disapply statutory pre-emption provisions.
SPECIAL RESOLUTION
If this form is signed and returned without any indication as to how the proxy shall vote, the proxy
will exercise his discretion both as to how he votes (and whether or not he abstains from voting).
Enter number of ordinary shares in relation to which your proxy is authorised to
vote or leave blank to authorise your proxy to act in relation to
your full entitlement
Please also tick this box if you are appointing more than one proxy
PRINT NAME: …............................................................
SIGNATURE: ................................................................
DATE: ...................................2017
Completed proxy forms should be delivered before 4pm on 25 July 2017 to the Company’s registrars:
Capita Asset Services, PXS, 34 Beckenham Road, Kent, BR3 4TU
Orogen plc (formerly Orogen Gold plc)
P a g e | 47
Annual Report 2016
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FORM OF PROXY
Notes:
1. To appoint as a proxy a person other than the Chairman of the Meeting insert the full name of that person in the space
provided. To appoint more than one proxy you may photocopy the form. Please indicate the proxy holder’s name and
the number of shares in relation to which they are authorised to act as your proxy (which, in aggregate, should not
exceed the number of shares held by you). Please also indicate if the proxy instruction is one of multiple instructions
being given. All forms must be signed and should be returned together in the same envelope. A proxy need not be a
member of the Company.
2. Unless otherwise indicated the proxy will vote as he thinks for or, at his discretion, abstain from voting.
3. The Form of Proxy over must arrive at Capita Asset Services, PXS, 34 Beckenham Road, Beckenham, BR3 4TU during usual
business hours accompanied by any Power of attorney under which it is executed (if applicable) no later than 4pm on 25
July 2017.
4. A member which is a company must execute the Form of Proxy under its common seal or signed on its behalf by an
officer of the Company.
5. Any power of attorney or other authority under which the Form of Proxy is signed (or duly certified copy of such power
or authority) must be included with the Form of Proxy.
6. The Form of Proxy is for use in respect of the shareholder account specified above only and should not be amended or
submitted in respect of a different account.
7. The vote ‘Withheld’ option is provided to enable you to abstain on any particular resolution. Such a vote is not a vote in
law and will not be counted in the vote ‘For’ and ‘Against’ a resolution.
8. Corporate Representatives must make themselves known to the Company prior to the start of the Meeting.
9. Shares held in uncertificated form (i.e. in CREST) may be voted through the CREST Proxy Voting Service in accordance
with the procedures set out in the CREST Manual.
Orogen plc (formerly Orogen Gold plc)
P a g e | 48
Annual Report 2016