TIDMARK
RNS Number : 7032Q
Arkle Resources PLC
30 June 2022
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
30 June 2022
Arkle Resources PLC
("Arkle", the "Group" or the "Company")
Final Results for the Year Ended 31 December 2021
Arkle Resources PLC (LON: ARK), the Irish gold and zinc
exploration and development company, is pleased to announce its
audited results for the year ending 31 December 2021.
Chairman's Statement
Arkle is an Irish based zinc and gold explorer with an active
zinc exploration project in the Stonepark area of Limerick and
ongoing gold exploration in Wexford / Wicklow and in Donegal. In
recent months, the directors have also been examining resource
projects in other jurisdictions, resulting in our entry into
Zimbabwe in June 2022.
It is frustrating to be an explorer at present. With zinc
selling above $3,700 a tonne and gold over $1,800 an ounce it
should be a good time for explorers. The future outlook for metals
has rarely been better. There is an increasing demand and
consumption of metals, being driven by the green economy: electric
vehicles require substantial quantities while one offshore wind
turbine contains up to 1,600 tonnes of metal.
Yet there has been a substantial drop in exploration
expenditure. We anticipate there can only be one outcome - higher
prices. For those of us willing to take the chance the potential
returns are greater.
There has been a drop in exploration, which some consider
attributable to some speculative capital being use on alternative
investments in technology and crypto. Recent collapses in these
sectors might be a wake-up call. Additionally, mining is not seen
to be environmentally friendly, and the industry tends to underplay
the positive impact it has on job creation, infrastructure
development and tax receipts.
Ireland, for long a beacon on how to provide a good structure
for exploration, is faltering. Long delays in renewing exploration
permits and some unhelpful political statements increase
uncertainty. An exploration dollar is an orphan with no loyalties.
It goes where it is most wanted. Anything that increases
uncertainty will have a detrimental impact on exploration. There
are more commercial deposits to be discovered in Ireland. For more
than 50 years Ireland has been at the forefront with clear,
transparent and stable policies relating to title, tax and
environmental commitments. It is hoped that the current
uncertainties are purely temporary.
Turning to the ongoing activities of Arkle. Very promising
results have come from drilling undertaken by our partner, Group
Eleven, on our 23.44% owned Stonepark zinc licences in Limerick. A
deep hole in an undrilled part of the block discovered a previously
unknown fault. Large Irish zinc deposits are generally discovered
at the base of a fault. Group Eleven has been exploring their own
ground prior to this in an attempt to find such a fault. The
Stonepark results may point toward a large zinc target a few
hundred metres to the north of the discovery hole. While examining
how best to proceed with this discovery, three holes will be
drilled in and around the existing shallow 5 million tonne zinc
discovery at Stonepark North.
Our gold exploration in Wicklow / Wexford is once again proving
to be an enigma. A 13 hole programme produced outstanding results
from a few holes then either the veins petered out or we missed
them in drilling. We have spent time re-examining the data and we
have commissioned a full review and modelling exercise on the
extensive database we hold. While awaiting this we are looking at
some further detailed sampling and mapping using the new technology
that successfully identified new zones. There remains huge
potential in the area and we intend to drill.
In the Inishown peninsula of Donegal we have a very specific
target. We had hoped to drill this area in early 2022 but months of
delays in renewing licences means we have missed the window, but we
intend to drill in the future.
Despite our good gold prospects, the recent significant zinc
results and very high metal prices, the Arkle share price has
languished. The directors have concluded that it is worthwhile
examining potential opportunities outside of Ireland, which we have
been doing. Most of the projects we have seen have been worked
before and / or shopped around and have not been pursued
further.
We have developed a focus on battery metals: lithium, cobalt,
copper and rare earths. As a first tentative low cost step into
this new area, post year-end we were awarded three licences in
Southern Zimbabwe, covering 163 hectares to prospect for lithium.
These licences contain hard rock spodumene which is known to
contain lithium and the area saw mining of lepidolite (a lithium
bearing mineral) in the late 1960s. Zimbabwe is a major hard rock
lithium producer.
We are also examining a specific exploration opportunity in
another jurisdiction. I look forward to updating shareholders on
this as soon as possible.
John Teeling
Chairman
29 June 2022
Enquiries:
Arkle Resources PLC
John Teeling, Chairman +353 (0) 1 833 2833
Jim Finn, Finance Director +353 (0) 1 833 2833
SP Angel Corporate Finance LLP
Nominated Adviser & Joint Broker
Matthew Johnson/Adam Cowl +44 (0) 203 470 0470
First Equity Limited
Joint Broker
Jason Robertson +44 (0) 207 374 2212
BlytheRay +44 (0) 207 138 3204
Megan Ray
Rachael Brooks
Teneo
Luke Hogg +353 (0) 1 661 4055
Ciara Wylie +353 (0) 1 661 4055
ARKLE RESOURCES PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEARED 31 DECEMBER 2021
2021 2020
EUR EUR
Administrative expenses (320,266) (324,099)
Impairment of exploration and evaluation assets - (330,000)
---------- -----------
Loss from operations (320,266) (654,099)
Profit/(loss) due to fair value volatility of warrants 746,526 (441,829)
---------- -----------
Profit/(loss) before tax 426,260 (1,095,928)
Tax expense - -
---------- -----------
Profit/(loss) for the year 426,260 (1,095,928)
---------- -----------
Total comprehensive income 426,260 (1,095,928)
========== ===========
Earnings per share attributable to the ordinary equity holders of the parent
cents cents
Profit/(loss) per share - Basic & Diluted 0.14 (0.50)
========== ===========
ARKLE RESOURCES PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER
2021
Assets 2021 2020
Non-current assets EUR EUR
Intangible assets 3,831,080 3,373,488
----------- -----------
Current assets
Other receivables 32,635 21,923
Cash and cash equivalents 79,678 684,837
----------- -----------
112,313 706,760
----------- -----------
Total assets 3,943,393 4,080,248
----------- -----------
Liabilities Current liabilities
Trade and other liabilities (233,872) (176,664)
Warrants (159,672) (906,198)
----------- -----------
Total liabilities (393,544) (1,082,862)
----------- -----------
Net assets 3,549,849 2,997,386
=========== ===========
Issued capital and reserves attributable to owners of the parent
Called-up Share capital - Deferred 992,337 992,337
Called-up Share capital - Ordinary 764,956 742,612
Share premium reserve 6,680,245 6,605,681
Share based payments reserve 156,494 127,199
Retained deficit (5,044,183) (5,470,443)
----------- -----------
TOTAL EQUITY 3,549,849 2,997,386
=========== ===========
ARKLE RESOURCES PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL
YEARED 31 DECEMBER 2021
Called Called up
up Share Share Share
Capital Capital Share Based Payment Retained
Deferred Ordinary Premium Reserve Deficit Total
EUR EUR EUR EUR EUR EUR
At 1 January 2021 992,337 742,612 6,605,681 127,199 (5,470,443) 2,997,386
Shares issued - 22,344 74,564 - - 96,908
Credit to equity
for equity-settled
share-based payments - - - 29,295 - 29,295
Profit for the
year - - - - 426,260 358,250
---------- ---------- ---------- --------------- ------------ ------------
At 31 December
2021 992,337 764,956 6,680,245 156,494 (5,044,183) 3,549,849
========== ========== ========== =============== ============ ============
At 1 January
2020 - 1,323,116 6,209,190 44,989 (4,314,086) 3,263,209
Sub-division
of shares 992,337 (992,337) - - - -
Shares issued - 411,833 396,491 - - 808,324
Share issue expenses - - - - (60,429) (60,429)
Credit to equity
for equity-settled
share-based payments - - - 82,210 - 82,210
Loss for the
year - - - - (1,095,928) (1,095,928)
---------- ---------- ---------- --------------- ------------ ------------
At 31 December
2020 992,337 742,612 6,605,681 127,199 (5,470,443) 2,997,386
========== ========== ========== =============== ============ ============
Deferred share capital
The deferred share reserve comprises of the value of the
deferred shares that arose when the Company divided the ordinary
shares via special resolution on 22 April 2020 the shares into
500,000,000 deferred shares of 0.75 cent each and 500,000,000
ordinary shares of 0.25 cent each.
Called up ordinary share capital
The called up ordinary share capital reserve comprises of the
nominal value of the issued share capital of the Company.
Share premium
The share premium reserve comprises of the excess of monies
received in respect of share capital over the nominal value of
shares issued.
Share based payment reserve
The share based payment reserve arises on the grant of share
options to directors and consultants under the share options plan.
Share options expired are reallocated from share based payment
reserve to retained deficit at their grant date fair value.
Retained deficit
Retained deficit comprises accumulated losses in the current and
prior financial years.
ARKLE RESOURCES PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE FINANCIAL YEARED 31 DECEMBER 2021
2021 2020
EUR EUR
Cash flows from operating activities
Profit / (loss) for the year
Adjustments for 426,260 (1,095,928)
Impairment of exploration and evaluation assets - 330,000
Share based payments charge 29,295 42,679
Fair Value movement of warrants (746,526) 441,829
Foreign exchange (25,527) (4,847)
--------- -----------
(316,498) (286,267)
Movements in working capital:
Increase in trade and other receivables (10,712) (18,059)
Increase / (decrease) in trade and other payables 57,208 (30,688)
--------- -----------
Cash used in operations (270,002) (335,014)
--------- -----------
Net cash used in operating activities (270,002) (335,014)
--------- -----------
Cash flows from investing activities
Payments for exploration and evaluation (457,592) (218,247)
--------- -----------
Net cash used in investing activities (457,592) (218,247)
--------- -----------
Cash flows from financing activities
Proceeds from issue of equity shares 96,908 1,254,049
Share issue expenses - (60,429)
--------- -----------
Net cash generated from financing activities 96,908 1,193,620
--------- -----------
Net cash (decrease) / increase in cash and cash
equivalents (630,686) 640,359
Cash and cash equivalents at the beginning of year 684,837 39,631
Exchange gains on cash and cash equivalents 25,527 4,847
--------- -----------
Cash and cash equivalents at the end of the year 79,678 684,837
========= ===========
Notes:
1. Accounting Policies
There were no changes in accounting policies from those used to
prepare the Group's Annual Report for financial year ended 31
December 2020. The financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the European Union and in accordance with the
Companies Act 2014.
2. Earnings per Share
(i) Earnings per share
Basic profit/(loss) per share is computed by dividing the loss
after taxation for the year attributable to ordinary shareholders
by the weighted average number of ordinary shares in issue and
ranking for dividend during the year. Diluted profit/(loss)loss per
share is computed by dividing the loss after taxation for the year
by the weighted average number of ordinary shares in issue,
adjusted for the effect of all dilutive potential ordinary shares
that were outstanding during the year.
The following tables sets out the computation for basic and
diluted earnings per share (EPS):
2021 2020
cents cents
Profit/(Loss) per share - Basic and Diluted 0.14 (0.50)
Total diluted earnings per share attributable
to the ordinary equity holders of the Company 0.14 (0.50)
(ii) Reconciliation of earnings used in calculating earnings per
share
Basic loss per share
The earnings and weighted average number of ordinary shares used
in the calculation of basic loss per share are as follows:
Profit/(loss) from continuing operations
attributable to the ordinary equity holders
of the Company
EUR EUR
Used in calculating basic earnings per share 426,260 (1,095,928)
Used in calculating diluted earnings per share 426,260 (1,095,928)
(iii) Denominator
2021 2020
Number Number
For basic and diluted earnings per share 305,517,186 220,039,097
Basic and diluted profit/(loss) per share is the same as the
effect of the outstanding share options and warrants is
anti-dilutive.
3. Going Concern
The Group generated a profit for the financial year of
EUR426,260 (2020: loss EUR1,095,928) and the Group had net current
liabilities of EUR281,231 (2020: net current liabilities
EUR376,102) at the statement of financial position date leading to
concern about the Group's ability to continue as a going
concern.
The Group had a cash balance of EUR79,678 (2020: EUR684,837) at
the statement of financial position date.
Included in current liabilities is an amount of EUR172,500
(2020: EUR127,500) owed to key management personnel in respect of
remuneration due at the statement of financial position. Key
management have confirmed that they will not seek settlement of
these amounts in cash for a period of at least one year after the
date of approval of the financial statements or until the Group has
generated sufficient funds from its operations after paying its
third party creditors.
The directors have prepared cashflow projections for a period of
at least twelve months from the date of approval of these financial
statements. The cashflow projections include any anticipated
impacts of the Covid-19 pandemic on the Group and Company as well
as the minimum spend/cash call requirements in relation to licenses
held by the Group. As the Group and the Company are not revenue or
cash generating they rely on raising capital from the public
market. The cash flow projections prepared by the Group and Company
indicate that additional finances will be required to meet the
obligations of the Group and Company for a period of at least
twelve months from the date of approval of these financial
statements. This amounts to a material uncertainty that may cast
significant doubt on the Group's ability to continue as a going
concern.
The directors are confident that additional capital can be
raised as required. The Group received GBP86,250 from the
conversion of warrants during the financial year. Subsequent to
year end, pursuant to the receipt of warrant conversion notices,
the Group also raised GBP150,400 in February 2022 and GBP46,600 in
April 2022. Further information is detailed in Note 8.
As in previous years the Directors have given careful
consideration to the appropriateness of the going concern basis in
the preparation of the financial statements and believe the going
concern basis is appropriate for these financial statements. The
financial statements do not include any adjustment to the carrying
amount, or classification
4. Intangible Assets
Exploration and Evaluation: 2021 2020
EUR EUR
Cost:
At 1 January 3,373,488 3,445,710
Additions 457,592 257,778
Impairment - (330,000)
At 31 December 3,831,080 3,373,488
Carrying amount:
At 31 December 3,831,080 3,373,488
In 2012 the Group entered into an agreement with Teck Ireland
Limited ("Teck"), a subsidiary of Teck Resources Limited, which
gave Teck the option of earning a 75% interest in licences held by
the Group in Cavan/Meath by spending EUR1.35 million on the
licences in order to earn the option to acquire 75% interest. As
per the agreement the licences had been transferred into a new
company, Oldcastle Zinc Limited. As at 31 December 2019 Teck had
completed EUR1.35 million worth of expenditure to give them a total
of 75% in the company.
On 10 November 2020, the Group and Teck Ireland Limited agreed
to terminate the Oldcastle agreement and dissolve the joint
venture. Accordingly, the directors have impaired in full all
expenditure relating to the Oldcastle licences, resulting in an
impairment charge of EUR330,000 in the prior year.
In 2007 the Group entered into an agreement with Teck Cominco
which gave Teck Cominco the option to earn a 75% interest in a
number of other licences held by the Group. Teck Cominco had to
spend CAD$3m to earn the interest. During 2012 the relevant
licences were transferred to a new company, TILZ Minerals Limited,
which at 31 December 2020 was owned 23.44% (2019: 23.44%) by
Limerick Zinc Limited (subsidiary of Arkle Resources plc) and
76.56% (2019: 76.56%) by Group Eleven Resources Corp (third
party).
On 13 September 2017 t he board of Arkle Resources plc were
informed that Group Eleven Resources Corp. a private company, has
acquired the 76.56% interest held by Teck Ireland in TILZ Minerals.
Arkle Resources plc owns the remaining 23.44%.
The Group's share of expenditure on the licences continues to be
capitalised as an exploration and evaluation asset. The Group is
subject to cash calls from Group Eleven Resources Corp. in respect
of the financing of the ongoing exploration and evaluation of these
licences. In the event that the Group decides not to meet these
cash calls its interest in TILZ Minerals Limited may be diluted
accordingly.
The realisation of the intangible assets is dependent on the
discovery and successful development of economic reserves which is
subject to a number of risks as outlined below:
The Group's exploration activities are subject to a number of
significant and potential risks including:
- uncertainties over development and operational risks;
- compliance with licence obligations;
-ability to raise finance to develop assets;
- liquidity risks; and
- going concern risks.
The directors are aware that by its nature there is an inherent
uncertainty in such exploration and evaluation expenditure as to
the value of the asset. Having reviewed the carrying value of
exploration and evaluation of assets at 31 December 2021 the
directors are satisfied that the value of the intangible asset is
not less than carrying value.
Segmental Analysis
2021 2020
EUR EUR
Limerick 1,600,424 1,600,424
Oldcastle - -
Rest of Ireland 2,230,656 1,773,064
3,831,080 3,373,488
5. Share Capital and Share Premium
2021 2020
EUR EUR
Authorised:
500,000,000 Ordinary shares of EUR0.0025 each 1,250,000 1,250,000
500,000,000 Deferred shares of EUR0.0075 each 3,750,000 3,750,000
5,000,000 5,000,000
Deferred Shares - nominal value of EUR0.0075
Share Share
Number Capital Premium
EUR EUR
At 1 January 2021 132,311,593 992,337 -
31 December 2021 132,311,593 992,337 -
Ordinary Shares - nominal value of EUR0.0025
Allotted, Called-Up and Fully Paid:
Share Share
Number Capital Premium
EUR EUR
At 1 January 2020 132,311,593 1,323,116 6,209,190
Transfer to deferred shares - (992,337) -
Issued during the financial year 164,733,333 411,833 396,491
At 31 December 2020 297,044,926 742,612 6,605,681
Issued during the financial year 8,937,500 22,344 74,564
31 December 2021 305,982,426 764,956 6,680,245
Movement in shares
On 19 January 2021, a total of 8,937,500 shares were issued on
the exercise of 8,937,500 warrants at a price of 0.5p and 1.2p per
share to provide additional working capital and fund development
costs.
6. Share Based Payments
Equity-settled share-based payments are measured at fair value
at the date of grant.
The Group plan provides for a grant price equal to the average
quoted market price of the ordinary shares on the date of
grant.
OPTIONS
2021 2021 2020 2020
Options Weighted average exercise Options Weighted average exercise
price in pence price in pence
Outstanding at beginning of
the financial year 13,100,000 1.22 2,800,000 2.276
Granted during the financial
year 3,000,000 1.80 10,300,000 0.93
----------- ----------------------------- ----------- -----------------------------
Outstanding at the end of the
financial year 16,100,000 1.32 13,100,000 1.22
=========== ============================= =========== =============================
Exercisable at the end of the
financial year 16,100,000 1.32 13,100,000 1.22
=========== ============================= =========== =============================
On 9 March 2021 a total of 3,000,000 options with an exercise
price of 1.8p per option were granted to the directors with a fair
value of EUR29,295. The fair value was calculated using the
Black-Scholes valuation model.
The inputs into the Black-Scholes valuation model were as
follows:
Grant 9 March 2021
Weighted average share price at date of grant (in pence) 1.0p
Weighted average exercise price (in pence) 1.8p
Expected volatility 116.32%
Expected life 7 years
Risk free rate 0.1%
Expected dividends none
Expected volatility was determined by management based on their
cumulative experience of the movement in share prices over the
years.
The terms of the options granted do not contain any market
conditions within the meaning of IFRS 2.
The Group capitalised expenses of EURNil (2020: EUR39,531) and
expensed costs of EUR29,295 (2020: EUR42,679) relating to
equity-settled share-based payment transactions during the
financial year.
7. Warrants
Fair Value
2021 2020
EUR EUR
At 1 January 906,198 18,644
FV of warrants issued during the year at grant date - 445,725
FV of warrants exercised during the year (68,010) -
Movement in fair value (678,516) 441,829
---------- --------
At 31 December 159,672 906,198
========== ========
Number
2021 2021 2020 2020
Warrants Weighted average exercise Warrants Weighted average exercise
price in pence price in pence
Outstanding at beginning of
the financial year 119,400,000 0.9 46,203,312 4.7
Granted during the financial
year - 125,400,000 0.9
Expired during the financial
year - (46,203,312) 4.7
Exercised during the
financial year (8,937,500) 0.5 (6,000,000) 0.5
------------ ---------------------------- ------------- ----------------------------
Outstanding and exercisable
at the end of the financial
year 110,462,500 0.9 119,400,000 0.9
============ ============================ ============= ============================
On 19 January 2021 a total of 3,000,000 (2020: 6,000,000)
warrants with an exercise price of 0.5p per warrant were exercised
with a fair value of EUR27,665. On 31 December 2021 the fair value
for the outstanding warrants was EUR75,857 (2020: EUR396,040). The
gain due to the movement in fair value of EUR292,518 (2020: loss
EUR217,001) was included in the Consolidated Statement of
Comprehensive Income. The fair value was calculated using the
Black-Scholes valuation model.
On 19 January 2021 a total of 5,937,500 warrants with an
exercise price of 1.2p per warrant were exercised with a fair value
of EUR40,345. On 31 December 2021 the fair value for the
outstanding warrants was EUR83,815 (2020: EUR510,158). The gain due
to the movement in fair value of EUR385,998 (2020: loss EUR510,158)
was included in the Consolidated Statement of Comprehensive Income.
The fair value was calculated using the Black-Scholes valuation
model.
8. Post Balance Sheet Events
On 22 February 2022, the Company announced that, pursuant to the
receipt of warrant conversion notices, it had raised GBP150,400
from the issue of 30,080,000 ordinary shares of EUR0.0025 each at
the exercise price of 0.5 pence per share.
On 28 April 2022, the Company announced that, pursuant to the
receipt of warrant conversion notices, it had raised GBP46,600 from
the issue of 9,320,000 ordinary shares of EUR0.0025 each at the
exercise price of 0.5 pence per share.
9. Annual General Meeting
The Company's Annual General Meeting will be held at held at the
Hotel Riu Plaza The Gresham, 23 O'Connell Street Upper, North City
Dublin, D01 C3W7, Ireland on 5 August 2022 at 10.00am.
General Information
The financial information set out above does not constitute the
Company's financial statements for the year ended 31 December 2021.
The financial information for 2020 is derived from the financial
statements for 2020 which have been delivered to the Companies
Registration Office. The auditors have reported on 2020 statements;
their report was unqualified. The financial statements for 2021
will be delivered to the Companies Registration Office.
A copy of the Company's Annual Report and Accounts for 2021 will
be mailed to all shareholders shortly and will also be available
for collection from the Company's registered office, 162 Clontarf
Road, Dublin 3, Ireland. The annual report will shortly be
available for viewing at Arkle's website at
www.arkleresources.com
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(END) Dow Jones Newswires
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