TIDMTGR
RNS Number : 1267I
Tirupati Graphite PLC
03 August 2023
03 August 2023
Tirupati Graphite plc
('Tirupati', 'TG' or the 'Company')
Final Results FY23
Tirupati Graphite plc, the specialist graphite producer and
developer of sustainable new age materials, is pleased to announce
its Audited Final Results for the year ended 31 March 2023 (FY23).
A copy of the Annual Report and Accounts will be available shortly
on the Company's website, www.tirupatigraphite.co.uk .
Operational and Development Highlights FY23
-- Achieved key milestone at Madagascan graphite projects:
o Completed and commissioned 18,000tpa Sahamamy plant;
o Upgraded Vatomina's capacity to 12,000tpa.
-- Achieved production and first sale of 97% purity flake graphite.
-- Took various measures to mitigate the risks of severe weather
conditions, stabilise operations and reduce both costs in H2 FY23
and carbon emissions per unit of production:
o Divided processing flow sheet into two parts, shifting the
first leg of processing, which removes c.90% of impurities from the
ore to the mine pit heads.
-- Undertook extensive market development activities resulting
in an increase of the number of customers supplied across
geographies.
-- Improved gross profits and operating margins, setting the
base to achieve profitability at corporate level.
Summary of the operating results for the year are as detailed in
table below:
Particulars Units FY23 FY22 YoY Change
Metric
Tons
Total Production (MT) 4,770 2,996 +59%
-------- ---------- ---------- -------------------
Mining & Processing
costs GBP 1,512,563 935,604 +62%
-------- ---------- ---------- -------------------
Human Resources costs GBP 326,783 378,671 -14%
-------- ---------- ---------- -------------------
Logistics utilities
& plant admin costs GBP 368,061 308,278 +19%
-------- ---------- ---------- -------------------
(Increase) / Decrease
in inventory GBP (676,058) (485,357) +39%
-------- ---------- ---------- -------------------
Total Costs of Production
(Excl. Depreciation) GBP 1,531,349 1,137,196 +35%
-------- ---------- ---------- -------------------
Cost per MT of Production GBP 321 380 -15%
-------- ---------- ---------- -------------------
Total Sales Volume MT 3,982 2,663 +50%
-------- ---------- ---------- -------------------
Total Revenues GBP 2,890,010 1,645,308 +76%
-------- ---------- ---------- -------------------
US$
/ GBP
Average Selling price per 841 / +4% in US$ /
per MT of Production MT 875 / 726 618 +17% in GBP terms
-------- ---------- ---------- -------------------
Gross Profit before
Depreciation GBP 1,358,661 508,112 +167%
-------- ---------- ---------- -------------------
Gross Margin on Sales % 47% 31% +52%
-------- ---------- ---------- -------------------
-- Operating margins up due to actions taken to mitigate weather
conditions and increasing capacity across Madagascan projects to
30,000tpa.
-- Strict cost discipline meant focus was maintained on
achieving the higher capacity construction and commissioning
alongside production from reorganised operations.
-- Management resources and teams on the ground worked
efficiently and trained local human resources to improve
productivity.
-- Grew operating margins - the Company believes it has reached
the operational stage where as the production ramp up is progressed
it will achieve profitability at corporate level.
-- 76% increase in revenues versus 50% increase in quantity sold
reflects higher price realisation in US$ terms and impacts of GBP
depreciation against US$ during the year.
Outlook of Madagascar Operations
-- Post year end, ramping up production and sales with a target
to achieve 75 - 80% of rated capacity at the earliest possible.
-- Identifying and addressing gaps like adding additional
standby power generation and other facilities to minimise plant
downtime and with a target to reach 100% capacity utilisation at
the earliest.
-- Substantially progressed business growth during Q1 FY24
having sold 2,772MT as compared to 3,982MT in whole of FY23,
-- Growth at a more gradual pace than targeted impacted by cash limitations due to:
o Considerable capital used to build capacity, undertake weather
mitigation work, complete the acquisition of Suni Resources, and
build inventory of spares and consumables for the expanded
operations, more so as larger corporate buyers need to be provided
60 to 90 days payment period from shipment date.
o Overdue VAT refund of >GBP 1 million as at end of FY23 from
the Tax Department in Madagascar (received >GBP 1 million VAT
refund for the previous periods April 2022 to December 2022).
-- In discussions with possible sources for post-sale credit
financing and in negotiations with certain customers for
prepayments.
-- Remains engaged to ramp up production and optimise capacity
utilisation to achieve consistent operating cash generation at
corporate level.
Capex Intensity and future capacity growth in Madagascar
Cumulative investments made in CAPEX by the Company a cross its
two projects in Madagascar up to 31 March 2023, depreciation
accrued thereon, and net depreciated book value of the CAPEX
investments made are as tabulated below:
Head of CAPEX Total Investment Accrued Depreciation Net Book Value
(GBP) at Cost (GBP) (GBP)
As at 31.03.2023 As at 31.03.2023 As at 31.03.2023
Property Plant
& Equipment 8,536,528 1,874,020 6,662,508
------------------ --------------------- ------------------
Infrastructure 4,727,205 417,910 4,309,295
------------------ --------------------- ------------------
Asset under Construction 226,634 - 226,634
------------------ --------------------- ------------------
Total 13,490,367 2,291,930 11,198,437
------------------ --------------------- ------------------
-- Applied resources to ensure it continues to increase its output and sales.
-- Any further major capacity build is planned to be progressed
once c.80% capacity utilisation at the current facilities is
achieved.
-- Continues to work on the opportunity of increasing the
capacity at Madagascar to 36,000 tons per annum as soon as
practicable.
Snapshot of Consolidated Income Statement
Summary of the Group's consolidated income statement for the
year ended 31 March 2023 is as follows:
Particulars FY23 (GBP) FY22 (GBP) YOY Change Commentary
(%)
Revenues grew
due to increased
production and
Revenues 2,890,010 1,645,308 76% sales
------------ ------------ ----------- ------------------------
Cost of Sales
grew at much lesser
rate than revenue
due to operational
Cost of Sales (1,531,349) (1,137,196) 35% efficiencies
------------ ------------ ----------- ------------------------
Resulted in Gross
Gross Profit Profit increase
(Excl. Dep) 1,358,661 508,112 167% by 167%
------------ ------------ ----------- ------------------------
Admin expenses
increased for
corporate costs,
fund raise costs
and increased
Less Administrative management team
Expenses (2,197,703) (1,774,581) 24% size on the ground
------------ ------------ ----------- ------------------------
Resulted in improved
EBITDA (839,042) (1,266,469) (34%) EBITDA loss decrease
------------ ------------ ----------- ------------------------
Increased due
to additional
Capex subjected
Less Depreciation (1,267,227) (565,079) 124% to depreciation
------------ ------------ ----------- ------------------------
Negative EBIT
increased by 15%
due to increased
EBIT (2,106,269) (1,831,548) 15% depreciation
------------ ------------ ----------- ------------------------
Finance Costs
Less Finance increased due
Cost (251,641) (140,209) 79% to new CLN issue
------------ ------------ ----------- ------------------------
Resulted in increase
in negative EBT
EBT (2,357,910) (1,971,757) 20% by 20 %
------------ ------------ ----------- ------------------------
Impact of Deferred
tax and current
tax provisions
in Madagascar
Less Taxes (9,775) 48,271 Subsidiaries
------------ ------------ ----------- ------------------------
EAT loss increased
by 23 %, due to
EAT (2,367,685) (1,923,486) 23% increased depreciation
------------ ------------ ----------- ------------------------
Loss per 2.59 pence 2.24 pence 16% Basic Loss per
share (Basic) share increased
by 16%
------------ ------------ ----------- ------------------------
Loss per 2.59 pence 2.24 pence 16% Diluted Loss per
share (Diluted) share increased
by 16%
------------ ------------ ----------- ------------------------
Highly favourable long term demand matrix
-- The global push for climate action and energy transition is
resulting in increased consumption of flake graphite in energy
storage lithium-ion batteries used in EVs and other
applications.
-- Increasing consumption of flake graphite is reported in
applications like fire safety, thermal management and advanced
materials and composites, while consumption in conventional
applications continues.
-- Substantial global dependence for flake graphite on Chinese
sources has created greater interest in the consumer industry for
non-Chinese sources.
-- The Company is not aware of any other new material production
having commenced during the year outside China.
-- The Company continues to increase its markets across
geographies as is evident from its growing sales although remains a
buyers' market at this time.
-- Non-Chinese battery capacities remain substantially in
development stage and expected to add new demand over the coming
years.
Inorganic growth
-- Completed the acquisition of Suni Resources SA ("Suni
Resources") as announced on 3 April 2023 from ASX listed Battery
Minerals Limited as part strategy to supply c.8% of global 2030
flake graphite demand, estimated to be no less than 5 million tons
by that time.
-- Acquisition brings two advanced stage flake graphite projects
in Mozambique, which host c.150 million tons of JORC Compliant
reserves and resources containing c.12 million tons of flake
graphite.
-- Commenced work on further optimising the studies conducted by
the previous owners to advance the projects and incorporate the
in-house advantages and processing technologies used by the
Company.
-- The Montepuez project is also being evaluated for its
Vanadium resource which has the potential to present as an economic
by-product and further strengthen the project's economics.
-- To further strengthen its presence in Madagascar, the Company
entered into a conditional agreement in September 2022 to acquire
three mining permits in Madagascar covering a total area of
31.25km2 and located in the vicinity of its existing projects.
Downstream and Advanced Materials
-- The sub-committee of the Board comprising the Independent
NEDs is continuing to look at the alternative options to meet the
objective of developing a downstream and advanced materials
business within the Company The Company plans to provide a more
detailed update to the market once these options have been fully
evaluated.
Other Developments
-- In Madagascar, continue to progress second phase of
exploration activities with an enhanced target of c.10,000 diamond
core drilling to be executed and acquired a second drilling rig for
the purpose.
-- Completed the construction of the maiden 100 kilo watt hydro
power plant in Sahamamy and generated its first power during the
year, though commercial use of power commenced only in June
2023.
-- Continued restoration of mining areas where appropriate and
plans further developed for the larger mining areas for catering to
current operations.
-- Continued to integrate environmentally friendly flake
graphite processing technologies for projects in Madagascar,
generating sand as a by-product, which remains in extensive use for
its internal developments.
-- Continued sustainability initiatives - further details to be
included in an updated Sustainability Report.
CHAIRMAN'S STATEMENT
I am pleased to present the sixth Annual Report of the Company
to our shareholders. Tirupati Graphite ('TG") has continued to
evolve and expand, helping to address the increasing demand for
graphite, one of the key critical minerals in the energy
transition, especially for emerging supply chains non-dependent on
single nations. Amidst this wider market demand, value creation
remains core to our culture, and we continue to leverage our
extensive graphite expertise and key principles to drive
sustainable value across our stakeholder base.
We have now completed two full financial years since our
ordinary shares were admitted to trading on the standard segment of
the main markets of The London Stock Exchange ("LSE"). While we
continued to evolve the development of our projects in Madagascar,
we have also sharpened our long term aims, targeting circa 8% of
the global flake graphite market by 2030, estimated to be circa
400,000 tpa, in the long-term as EV adaptation gains ground. The
Company set the base for this by completing the acquisition of two
world class graphite projects in Mozambique. Flake Graphite and its
derivatives are essential materials in technologies for achieving
improved energy efficiency, e-mobility, fire hazard safety, thermal
management, and evolution of new age materials. We recognise its
importance as a material, its market demand expectations, the
economics that create a sound business model, and the opportunities
it presents us with.
We are pleased to report that our first stage of development to
a capacity that enables us to become a profitable Company at the
Corporate level was completed during the year under reporting and
incorporated successful operational innovations at our producing
projects. The Company also successfully completed the acquisition
of Suni Resources S.A., incorporated in Mozambique, post year end.
Across its two projects, Suni holds a globally significant resource
base that sets an expanded foundation for our significant ambitions
as part of the global energy transition, with particular focus on
the electric vehicle segment.
It has been tireless efforts from the Board and management of
the Company that has led us to reach this stage and we will
continue to build from here with our step-by-step approach.
Achieving the capacities, we have to date significantly
strengthened our standing as a company and our prospects for
growing further business moving forward. We will refine our
capacity development for a short period and assess the location
options for our near-term future capacity additions that will best
fit the needs of our growing business, whether in Madagascar or in
Mozambique. In this period, it is our target to fully optimise the
outcomes of the capacities already created and continue to develop
deep relationships with markets of this critical mineral.
Shishir Poddar
Chair
Consolidated Statement of Comprehensive Income
For the year ended 31 March 2023
Notes 2023 2022
GBP GBP
Continuing operations
Revenue 5 2,890,010 1,645,308
================================= ====== ================ ==============
Cost of Sales 6 (1,531,349) (1,137,196)
Depreciation of Operating
Assets (1,024,564) (482,641)
Gross profit 334,097 25,471
================================= ====== ================ ==============
Administrative expenses 7 (2,440,366) (1,857,019)
Operating loss (2,106,269) (1,831,548)
Finance costs 9 (251,641) (140,209)
Loss before income tax (2,357,910) (1,971,757)
Income tax 10 (9,775) 48,271
================================= ====== ================ ==============
Loss for the year attributable
to owners of the Company (2,367,685) (1,923,486)
================================= ====== ================ ==============
Other comprehensive income:
Items that may be reclassified
to profit or loss:
================================= ====== ================ ==============
Exchange differences on
translation of foreign
operations (1,381,371) (361,662)
================================= ====== ================ ==============
Total comprehensive loss
for the year attributable
to the Group (3,749,056) (2,285,147)
================================= ====== ================ ==============
Earnings per share attributable Pence per
to owners of the Company Pence per share share
From continuing operations:
Basic and Diluted 11 (2.59) (2.24)
The accompanying accounting policies and notes are an integral
part of these finance
Consolidated and Company Statement of Financial Position
As at 31 March 2023
Notes Group Company
===================== ====== =========================== ===========================
2023 2022 2023 2022
===================== ====== ============ ============= ============ =============
GBP GBP GBP GBP
===================== ====== ============ ============= ============ =============
Non-current
assets
===================== ====== ============ ============= ============ =============
Investments
in subsidiaries 13 - - 3,921,348 3,901,023
===================== ====== ============ ============= ============ =============
Property, plant
and equipment 14 11,198,437 7,356,121 - -
===================== ====== ============ ============= ============ =============
Deferred tax 24 74,046 75,242 - -
===================== ====== ============ ============= ============ =============
Deposits 32,455 6,806 - -
===================== ====== ============ ============= ============ =============
Intangible assets 12 3,599,065 3,571,196 40,970 40,970
--------------------- ------ ------------ ------------- ------------ -------------
Total non-current
assets 14,904,003 11,009,365 3,962,318 3,941,993
--------------------- ------ ------------ ------------- ------------ -------------
Current assets
=====================
Inventory 16 1,386,558 732,274 - -
=====================
Trade and other
receivables 15 4,755,629 4,242,635 21,213,389 13,858,647
=====================
Cash and cash
equivalents 289,338 1,534,023 130,340 1,505,410
=====================
Total current
assets 6,431,525 6,508,932 21,343,729 15,364,057
--------------------- ------ ------------ ------------- ------------ -------------
Current liabilities
=====================
Trade and other
payables 17 1,684,808 730,869 735,440 315,207
=====================
Borrowings 19 909,000 536,000 909,000 536,000
=====================
Total current
liabilities 2,593,808 1,266,869 1,644,440 851,207
--------------------- ------ ------------ ------------- ------------ -------------
Net current
assets 3,837,717 5,242,063 19,699,289 14,512,850
--------------------- ------ ------------ ------------- ------------ -------------
Non-current
liabilities
===================== ====== ============ ============= ============ =============
Borrowings 19 1,862,500 473,000 1,862,500 473,000
===================== ====== ============ ============= ============ =============
Other payables 17 31,080 31,232 - -
===================== ====== ============ ============= ============ =============
Total non-current
liabilities 1,893,580 504,232 1,862,500 473,000
--------------------- ------ ------------ ------------- ------------ -------------
NET ASSETS 16,848,140 15,747,196 21,799,107 17,981,843
--------------------- ------ ------------ ------------- ------------ -------------
Equity
===================== ====== ============ ============= ============ =============
Share capital 20 2,536,195 2,173,497 2,536,195 2,173,497
===================== ====== ============ ============= ============ =============
Share premium
account 24,462,976 19,975,356 24,462,976 19,975,356
===================== ====== ============ ============= ============ =============
Warrant reserve 21 116,065 130,557 116,065 130,557
===================== ====== ============ ============= ============ =============
Foreign exchange
reserve (2,157,579) (776,208) - -
===================== ====== ============ ============= ============ =============
Retained losses (8,109,518) (5,756,006) (5,316,129) (4,297,566)
--------------------- ------ ------------ ------------- ------------ -------------
Equity attributable
to owners of
the Company 16,848,140 15,747,196 21,799,107 17,981,843
===================== ====== ============ ============= ============ =============
TOTAL EQUITY 16,848,140 15,747,196 21,799,107 17,981,843
--------------------- ------ ------------ ------------- ------------ -------------
The Company has elected to take the exemption under section 408
of the Companies Act 2006 not to present the company statement of
comprehensive income.
The loss for the company for the year was GBP1,032,736 (2022:
GBP1,400,141).
The accompanying accounting policies and notes are an integral
part of these financial statements.
The financial statements were approved by the Board of Directors
on 02 August 2023 and signed on its behalf by:
Mr Shishir Poddar
Executive Chairman and Managing Director
Company registration number: 10742540
Consolidated Statement of Changes in Equity
For the year ended 31 March 2023
Attributable to the owners of the company
Share Share premium Foreign Share Retained TOTAL
capital exchange warrants losses EQUITY
reserve reserve
----------
GBP GBP GBP GBP GBP GBP
---------- -------------- ------------ ---------- ------------ ------------
Balance at
1 April 2021 1,871,084 10,426,988 (414,546) 130,557 (3,832,520) 8,181,563
---------- -------------- ------------ ---------- ------------ ------------
Loss for the
period - - - - (1,923,486) (1,923,486)
---------- -------------- ------------ ---------- ------------ ------------
Other Comprehensive
Income: Exchange
translation
loss on foreign
operations - - (361,662) - - (361,662)
---------- -------------- ------------ ---------- ------------ ------------
Total comprehensive
income for
the year: - - (361,662) - (1,923,486) (2,285,148)
---------- -------------- ------------ ---------- ------------ ------------
Transactions
with owners
---------- -------------- ------------ ---------- ------------ ------------
Shares issued 302,413 9,548,368 - - - 9,850,781
---------- -------------- ------------ ---------- ------------ ------------
Balance at
31 March 2022 2,173,497 19,975,356 (776,208) 130,557 (5,756,006) 15,747,196
---------- -------------- ------------ ---------- ------------ ------------
Loss for the
year - - - - (2,367,685) (2,367,685)
---------- -------------- ------------ ---------- ------------ ------------
Other Comprehensive
Income: Exchange
translation
loss on foreign
operations - - (1,381,371) - - (1,381,371)
---------- -------------- ------------ ---------- ------------ ------------
Total comprehensive
income for
the year: - - (1,381,371) - (2,367,685) (3,749,056)
---------- -------------- ------------ ---------- ------------ ------------
Transactions
with owners
---------- -------------- ------------ ---------- ------------ ------------
Shares issued 362,698 4,487,302 - - - 4,850,000
---------- -------------- ------------ ---------- ------------ ------------
Adjustment
to Warrant
Reserve - 319 - (14,492) 14,173 -
---------- -------------- ------------ ---------- ------------ ------------
Balance at
31 March 2023 2,536,195 24,462,976 (2,157,579) 116,065 (8,109,518) 16,848,140
---------- -------------- ------------ ---------- ------------ ------------
The accompanying accounting policies and notes are an integral
part of these financial statements.
Share capital - Represents the nominal value of the issued share
capital.
Share premium account - Represents amounts received in excess of
the nominal value on the issue of share capital less any costs
associated with the issue of shares. During the year, GBP250,000
was adjusted as share issue expenses against share premium
reserves.
Retained losses - Represents accumulated comprehensive income
for the year and prior years excluding translation.
Foreign exchange reserve - Represents exchange differences
arising from the translation of the financial statements of foreign
subsidiaries and the retranslation of monetary items forming part
of the net investment in those subsidiaries.
Share warrant reserve - Represents reserve for equity component
of warrants issued as per IFRS 2 share-based payments.
Company Statement of Changes in Equity
For the year ended 31 March 2023
Attributable to equity shareholders
Share Share premium Share warrants Retained TOTAL
capital reserve losses EQUITY
----------
GBP GBP GBP GBP GBP
---------- -------------- --------------- ------------ ------------
Balance at 1 April
2021 1,871,084 10,426,988 130,557 (2,897,425) 9,531,204
---------- -------------- --------------- ------------ ------------
Loss for the period - - - (1,400,141) (1,400,141)
---------- -------------- --------------- ------------ ------------
Total comprehensive
income: - - - (1,400,141) (1,400,141)
---------- -------------- --------------- ------------ ------------
Transactions with
owners
---------- -------------- --------------- ------------ ------------
Shares issued 302,413 9,548,368 - - 9,850,781
---------- -------------- --------------- ------------ ------------
Balance at 31
March 2022 2,173,497 19,975,356 130,557 (4,297,566) 17,981,843
---------- -------------- --------------- ------------ ------------
Loss for the year - - - (1,032,736) (1,032,736)
---------- -------------- --------------- ------------ ------------
Total comprehensive
income: - - - (1,032,736) (1,032,736)
---------- -------------- --------------- ------------ ------------
Transactions with
owners
---------- -------------- --------------- ------------ ------------
Shares issued 362,698 4,487,302 - - 4,850,000
---------- -------------- --------------- ------------ ------------
Adjustment to warrant
reserve - 319 (14,492) 14,173 -
---------- -------------- --------------- ------------ ------------
Balance at 31
March 2023 2,536,195 24,462,976 116,065 (5,316,129) 21,799,107
---------- -------------- --------------- ------------ ------------
The accompanying accounting policies and notes are an integral
part of these financial statements.
Share capital - Represents the nominal value of the issued share
capital.
Share premium account - Represents amounts received in excess of
the nominal value on the issue of share capital less any costs
associated with the issue of shares. During the year, GBP250,000
was adjusted as share issue expenses against share premium
reserves.
Retained losses - Represents accumulated comprehensive income
for the year and prior years.
Share warrant reserve - Represents reserve for equity component
of warrants issued as per IFRS 2 share-based payments.
Consolidated Statement of Cash Flows
For the year ended 31 March 2023
2023 2022
GBP GBP
------------------------------------ ------------ ------------
Cash used in operating activities
------------ ------------
Loss for the year (2,357,910) (1,971,757)
------------ ------------
Adjustment for:
------------ ------------
Depreciation 1,267,227 565,079
------------ ------------
Convertible loan note costs 93,125 -
("CLN")
------------ ------------
Share based payments expense - -
------------ ------------
Lease interest 3,334
------------ ------------
Finance costs 251,641 140,209
------------ ------------
Unrealized Forex Loss / (Gain) (41,054) -
------------ ------------
Working capital changes:
------------ ------------
Increase/(decrease) in inventories (654,284) (271,181)
------------ ------------
Increase/(decrease) in receivables (1,566,964) (547,603)
------------ ------------
Increase/(decrease) in payables 861,019 285,596
------------ ------------
Increase /(decrease) in DTA
& Other assets (25,649) (10,723)
------------ ------------
Taxes paid (319) -
------------ ------------
Net cash from/(used in) operating
activities (2,169,835) (1,810,380)
------------ ------------
Cash flows from investing
activities:
------------ ------------
Purchase of tangible assets (2,797,818) (5,151,562)
------------ ------------
Advance towards asset purchase** (2,632,525) (2,592,163)
------------ ------------
Net cash (used in) investing
activities (5,430,343) (7,743,725)
------------ ------------
Cash flows from financing
activities*
------------ ------------
Proceeds from Shares issued
(net of costs) 4,750,000 9,576,781
------------ ------------
Proceeds from issue of Convertible 1,769,375 -
loan notes (net of costs)(see
below note)
------------ ------------
Lease Liability (10,087) 7,368
------------ ------------
Finance cost (168,496) (140,209)
------------ ------------
Net cash from financing activities 6,341,111 9,436,572
------------ ------------
Effects of exchange rates
on cash and cash
equivalents 14,382 -
------------ ------------
Net ( decrease )/increase
in cash and cash equivalents (1,244,685) (110,165)
------------ ------------
Cash and cash equivalents
at beginning of period 1,534,023 1,644,189
------------ ------------
Cash and cash equivalents
at end of period 289,338 1,534,023
------------ ------------
The accompanying accounting policies and notes are an integral
part of these financial statements.
*For reconciliation of cash and non-cash items from financing
activities refer Note No. 19 (Convertible loan notes) & note 20
(share capital).
**Advance towards asset purchase is for advance paid towards
acquisition of Suni resources.
Note: Reconciliation of Convertible Loan Notes
2023 2022
----------------------------------------- ---------- ----------
GBP GBP
----------------------------------------- ---------- ----------
Opening Balance as on 1(st) April 1,009,000 1,283,000
========== ==========
Issued during the year 1,862,500 -
========== ==========
Redeemed/Converted during the year (non
cash item) (100,000) (274,000)
----------------------------------------- ---------- ----------
Closing Balance as on 31(st) March 2,771,500 1,009,000
----------------------------------------- ---------- ----------
Particulars 2023 2022
GBP GBP
---------- -----
Amount Received from issue 1,862,500 -
---------- -----
Issue cost Paid against consideration (93,125) -
---------- -----
Net Amount received from issue 1,769,375 -
---------- -----
Company Statement of Cash Flows
For the year ended 31 March 2023
2023 2022
GBP GBP
----------------------------------------- ------------ ------------
Loss for the year (1,032,736) (1,400,141)
------------ ------------
Adjustment for:
------------ ------------
Increase in inventories - 212,580
------------ ------------
Share based payments - -
------------ ------------
Unrealized Forex Loss / (Gain) 20,675 -
------------ ------------
CLN issuance cost 93,125 -
------------ ------------
Finance costs 251,641 140,209
------------ ------------
Working capital changes:
------------ ------------
Increase/(decrease) in receivables (87,712) (5,718,677)
------------ ------------
Increase/(decrease) in payables 319,244 95,427
------------ ------------
Net cash used in operating activities (435,763) (6,670,602)
------------ ------------
Cash flows from investing activities:
------------ ------------
Sale of tangible assets - 201,725
------------ ------------
Advance towards asset purchase** (2,632,525) (2,592,163)
------------ ------------
Loans to Subsidiaries (4,634,505) -
------------ ------------
Investment in subsidiaries (20,325) (361,575)
------------ ------------
Net cash (used in) investing activities (7,287,355) (2,752,013)
------------ ------------
Cash flows from financing activities*
------------ ------------
Shares issued 4,750,000 9,576,781
------------ ------------
Proceeds from issue of convertible 1,769,375 -
loan notes
------------ ------------
Finance costs (168,496) (140,209)
------------ ------------
Net cash from financing activities 6,350,879 9,436,572
------------ ------------
Effects of exchange rates on cash (2,831) -
and cash equivalents
------------ ------------
Net (decrease)/increase in cash
and cash equivalents (1,375,070) 13,956
------------ ------------
Cash and cash equivalents brought
forward 1,505,410 1,491,454
------------ ------------
Cash and cash equivalents carried
forward 130,340 1,505,410
------------ ------------
*For reconciliation of cash and non-cash items from financing
activities refer Note No. 19 (Convertible loan notes) & note 20
(share capital).
**Advance towards asset purchase is for advance paid towards
acquisition of Suni resources.
The accompanying accounting policies and notes are an integral
part of these financial statements.
Note: Reconciliation of Convertible Loan Notes
2023 2022
----------------------------------------- ---------- ----------
GBP GBP
----------------------------------------- ---------- ----------
Opening Balance as on 1(st) April 1,009,000 1,283,000
========== ==========
Issued during the year 1,862,500 -
========== ==========
Redeemed/Converted during the year (non
cash item) (100,000) (274,000)
----------------------------------------- ---------- ----------
Closing Balance as on 31(st) March 2,771,500 1,009,000
----------------------------------------- ---------- ----------
Particulars 2023 2022
GBP GBP
---------- -----
Amount Received from issue 1,862,500 -
---------- -----
Issue cost Paid against consideration (93,125) -
---------- -----
Net Amount received from issue 1,769,375 -
---------- -----
Notes to the Financial Statements
1. General Information
Tirupati Graphite plc (the "Company") is incorporated in England
and Wales, under the Companies Act 2006. The registered office
address is given on Company Information page.
The Company is a public company, limited by shares. On 14
December 2020 the ordinary shares of the Company were admitted on
the official list of the FCA and to trading on the main market of
the London stock exchange through standard listing.
The principal activities of the Company and its subsidiaries
(the "Group") and the nature of the Group's operations are set out
in the Strategic Report.
These consolidated financial statements are presented in pounds
sterling since that is the currency of the primary economic
environment in which the Group and Company operates.
2. Adoption of new and revised UK adopted IAS
New Standards
The Group and Company have adopted all recognition, measurement,
and disclosure requirements of IFRS, including any new and revised
standards and Interpretations of IFRS, in effect for annual periods
commencing on or after 1 April 2022. The following IFRS or IFRIC
interpretations were effective for the first time for the financial
year beginning 1 January 2022. Their adoption has not had any
material impact on the disclosures or on the amounts reported in
this financial information:
Standards/interpretations Description Effective from
IFRS 3 amendments Business Combinations 1 January 2022
---------------------------- ---------------
IAS 16 amendments Property, Plant and 1 January 2022
Equipment
---------------------------- ---------------
IAS 37 amendments Provisions, Contingent 1 January 2022
Liabilities and Contingent
Assets
---------------------------- ---------------
IFRS 9 amendments Annual Improvements 1 January 2022
to IFRS Standards
2018-2020 (fees in
the 10 percent test
for derecognition
of financial liabilities).
---------------------------- ---------------
Standards which are in issue but not yet effective:
At the date of authorisation of these financial statements, the
following Standards and Interpretation, which have not yet been
applied in these financial statements, were in issue but not yet
effective.
Standard or Description Effective
interpretation date
IAS 1 Amendments - Classification of Liabilities 1 January
as Current or Non-current 2023
------------------------------------------- -----------
IAS 8 Amendments - Definition of Accounting 1 January
estimate 2023
------------------------------------------- -----------
IAS 12 Amendments - Deferred Tax related 1 January
to Assets and Liabilities arising 2023
from a Single Transaction
------------------------------------------- -----------
IAS 1 amendments Disclosure of accounting policies 1 January
and IFRS practice 2023
statement 2
------------------------------------------- -----------
The Group and Company have not early adopted any of the above
standards and intends to adopt them when they become effective.
3. Significant Accounting Policies
Basis of Preparation
These consolidated financial statements have been prepared in
accordance with UK adopted international accounting standard (UK-
adopted IAS) in conformity with the requirements of the Companies
Act 2006 and in accordance with the requirements of the Companies
Act 2006.
The financial statements have been prepared on the historical
cost basis, except for financial instruments that are measured at
the fair values at the end of the reporting period. Historical cost
is generally based on the fair value of the consideration given in
exchange for goods and services.
The preparation of financial statements in conformity with
UK-adopted IAS requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in
the process of applying the accounting policies. The areas
involving a higher degree of judgement or complexity, or areas
where assumptions and estimates are significant to the consolidated
financial statements, are disclosed in Note 4.
The principal accounting policies adopted are set out on the
following pages.
Going Concern
The Group's business activities, together with the factors
likely to affect its future development, performance and position
are set out in the Business Review and Strategic Report Sections.
The financial position of the Group and the Company, their cash
flows and liquidity positions are contained in the financial
statements. The expected evolution of the business and significant
post year end events is also described in the business review and
strategic reports. In addition, the Annual Report discloses the
Group's objectives, policies and processes for managing its
business and capital; its financial risk management objectives;
details of its financial instruments; and its exposure to credit
and liquidity risk.
Since its Initial Public Offering and admission for trading on
the standard segment of the London Stock Exchange, the company has
executed development to reach a capacity of 30,000 tons flake
graphite production by end of the reporting period and is engaged
in ramping up production while selling its produce globally. In the
period the Company continued to produce and sell from the created
facilities and its annual revenues continue to grow. The Company
further reported positive operating gross cash margins throughout
the period and addressed any challenges that came on its way
successfully finding solutions as has been reported by the Company
on a continued basis.
For the year under reporting, the Company achieved 47% operating
margins at a total production of 4,770MT clocking sales of 3982
tons and yielding revenue of GBP2,890,010 up 76% over previous year
whereas the new 18,000 tons capacity was only commissioned at the
end of the year. In the first quarter of the current financial
year, the Company achieved sales of 2772 tons which represent c.70%
of the quantity sold in the year under reporting and the Company
continues to ramp up its production and sales with a target to
achieve 75-80% production and sales on the installed capacity.
According to the Company's estimates, it achieves positive
operating cash flows at the corporate level at an estimated 800-900
tons of sales per month.
The Company raised a total gross sum of GBP6,862,500 during the
year by way of capital raise activities, 1,862,500 by way of
Convertible Loan Notes and GBP5,000,000 by way of equity placing.
Since admission in December 2020, the Company had raised a sum of
GBP16,000,000 up to 31 March 2022. Thus, the Company has an
established track record for raising funds for its development,
though it is not guaranteed that the Company will be able to raise
funds successfully in the future. However, the Company's current
established capacities and operations provide reasonable basis to
assume that the Company can continue to meet its costs and cash
requirements at the consolidated level with its revenues.
While the Company has been in a stringent cash position at the
close of the year under reporting, the Company continues to produce
and sell and realise sale proceeds increasing output step by step
within its available resources. The Company is also engaged to
explore possible routes for financing its receivables or by way of
convertible debt to ease its liquidity position it continues to
manage its business within the available resources.
Taking in to account the comments above, the Directors have a
reasonable expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future, given
its current resources, installed capacities and operations, and
growing sales and revenues which are expected to add positive
operating cash flows which the Company can use and leverage for its
future growth.
Were the Company unable to meet its cash flow needs from its
current revenue resources, the Company shall not hesitate from
raising any gap funding and the Board believes and has demonstrated
that it has the ability to do so. Therefore, the Company continues
to adopt the going concern basis of accounting in preparing the
financial statements and is of the view that with the development
of the business and creation of capacities over the past few years,
it has attained the status that it shall remain a going concern for
the foreseeable future.
The Company notes that even though the Company has historically
successfully raised capital to meet its capital needs, there is no
certainty that the Company shall be able to raise funds over the
next 12 months to meet its obligations and/or needs if the
situation so requires. Thus the auditors made reference to include
a material uncertainty in relation to going concern in their audit
opinion.
Basis of Consolidation
Subsidiaries are all entities (including structured entities)
over which the Group has control. The Group controls an entity when
the Group is exposed to, or has rights to, variable returns from
its involvement with the entity and has the ability to affect those
returns through its power over the entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control
ceases.
The Group re-assesses whether or not it controls an investee if
facts and circumstances indicate that there are changes to one or
more of the three elements of control. Assets, liabilities, income
and expenses of a subsidiary acquired or disposed of during the
year are included in the consolidated financial statements from the
date the Group gains control until the date the Group ceases to
control the subsidiary.
The Group consists of Tirupati Graphite plc and its wholly owned
subsidiaries Tirupati Madagascar Ventures and Etablissements
Rostaing.
In the company financial statements, investments in subsidiaries
are accounted for at cost less impairment.
The consolidated financial statements incorporate those of
Tirupati Graphite plc and all of its subsidiaries (i.e. entities
that the group controls through its power to govern the financial
and operating policies so as to obtain economic benefits).
Subsidiaries acquired during the year are consolidated using the
purchase method. Their results are incorporated from the date that
control passes.
All financial statements are made up to 31 March 2023. Where
necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with
those used by other members of the group.
All intra-group transactions, balances, and unrealised gains on
transactions between Group companies are eliminated by accounting
resulting foreign exchange difference into Other Comprehensive
Income and foreign exchange reserve on consolidation.
Segment Reporting
The Group's chief operating decision makers are considered to be
the Board and senior management who have determined that as the
Group has only Graphite mining extraction activities in one region,
Madagascar as all the activities are closely linked and monitored
as one operating and geographical segment. Thus its Corporate
Office in London, UK and the Company is not seen as a separate
reporting segment. Therefore results, assets and liabilities of the
operating segment are the same as presented in the Group's primary
statements. Previously Company reported segment information,
relating to assets and liabilities of the group's subsidiaries
which the management has reassessed, leading to the conclusion that
such segment reporting is not relevant and hence removed from the
current report.
Revenue Recognition
Revenue is measured at the fair value of the consideration
received or receivable and represents amounts receivable for goods
or services supplied in course of ordinary business, stated net of
discounts, returns and value added taxes. The Group recognises
revenue in accordance with IFRS 15 at either a point in time or
over time, depending on the nature of the goods or services and
existence of acceptance clauses.
The Incoterms at which the Company conducts its sale of goods
are Free on Board (FOB) or Cost Insurance Freight (CIF) basis.
Under these incoterms as per Uniform Customs and Practices the
point of transfer of risk and rewards for the goods sold to the
buyer is the port from which the goods are shipped. Thus, the point
of revenue recognised by the Company is the entry of goods duly
stuffed in containers and sealed at which point the charge of goods
are transferred to the prearranged shipping line who issue the
relevant shipping document as the goods are loaded on the ship.
Foreign Currencies
For each entity, the Group determines the functional currency,
and items included in the consolidated financial statements of each
entity are measured using that functional currency. The Group's
financial statements are prepared and presented in in Pounds
sterling, which is its functional currency.
Foreign Currency Transactions
Transactions in foreign currencies are translated at the foreign
exchange rate ruling at the date of the transaction. Foreign
exchange differences arising on translation are recognised in
profit or loss. The subsidiaries are accounted into Madagascar
local currency i.e., Malagasy Ariary. For the purpose of
consolidation, the year-end assets and liabilities are converted at
closing rate and all income statement items are converted using
average rate for the year. The difference arising on such is passed
through Other Comprehensive Income and Foreign Exchange
Reserves.
Taxation
Income tax represents the sum of current tax and deferred
tax.
Current tax
Current tax is based on taxable profit or loss for the year.
Taxable profit or loss differs from net profit or loss as reported
in the 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's liability for current tax is calculated using tax rates
that have been enacted or substantively enacted by the balance
sheet date.
A provision is recognised for those matters for which the tax
determination is uncertain, but it is considered probable that
there will be a future outflow of funds to a tax authority. The
provisions are measured at the best estimate of the amount expected
to become payable. The assessment is based on the judgement of tax
professionals within the Company supported by previous experience
in respect of such activities and in certain cases based on
specialist independent tax advice.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit and is accounted for using the
balance sheet liability method.
Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits
will be available against which deductible temporary differences
can be utilised. Such assets and liabilities are not recognised if
the temporary difference arises from the initial recognition of
intangible asset 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 assets is reviewed at each
balance sheet 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 is
realised based on tax laws and rates that have been enacted or
substantively enacted at the balance sheet date. Deferred tax is
charged or credited in the income statement, except when it relates
to items charged or credited in other comprehensive income, in
which case the deferred tax is also dealt with in other
comprehensive income.
The measurement of deferred tax liabilities and assets reflects
the tax consequences that would follow from the manner in which the
Group expects, at the end of the reporting period, to recover or
settle the carrying amount of its assets and liabilities.
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 intends to settle its
current tax assets and liabilities on a net basis.
Assets Under Construction
All expenditure on the construction, installation or completion
of infrastructure facilities is capitalised as construction in
progress within "Assets Under Construction". Once production starts
at a project that was under construction, all assets included in
"Assets Under Construction" are transferred into "Property, Plant
and Equipment". It is at this point that depreciation/amortisation
commences over its useful economic life.
Property, Plant and Equipment
Property, Plant and Equipment in the course of construction for
production, supply or administrative purposes, or for purposes not
yet determined, are carried at cost, less any recognised impairment
loss. Costs includes professional fees and, for qualifying assets,
borrowing costs capitalised in accordance with the Group's
accounting policy. Depreciation of these assets, on the same basis
as other property assets, commences when the assets are ready for
their intended use.
Fixtures and equipment are stated at cost less accumulated
depreciation and any recognised impairment loss. Depreciation is
recognised so as to write off the cost or valuation of assets
(other than freehold land and properties under construction) less
their residual values over their useful lives, using the
straight-line method, on the following bases:
Plant and machinery 10%-25% per annum
Infrastructure and fixtures* 10%-25% per annum
*It includes mine developments assets, furniture & fixtures
land lease assets, engineering centre and similar assets that are
not included in Plant and Machinery.
The estimated useful lives, residual values and depreciation
method are reviewed at the end of each reporting period, with the
effect of any changes in estimate accounted for on a prospective
basis.
An item of Property, Plant and Equipment is derecognised upon
disposal or when no future economic benefits are expected to arise
from the continued use of the asset. The gain or loss arising on
the disposal or scrappage of an asset is determined as the
difference between the sales proceeds and the carrying amount of
the asset and is recognised in income.
Mining Exploration and Evaluation
The Company carries out exploration and evaluation activities
whenever required with the help of company's consultant and in
house geologists to determine if the exploration results returned
during the period warrant further exploration expenditure and have
the potential to result in an economic discovery. The amount of
expenses incurred are towards pumping and manpower which are small
in amounts and company's charges the same to income statement and
does not recognise separate asset under IFRS 6, since company finds
it immaterial to show it as recoverable asset. During the year,
amount of GBP 1,659 (2022: Nil) is charged to income statement in
the nature of research and development expenses.
Intangible assets recorded at fair-value on business
combination
The Company acquired two entities located in Madagascar which
are its current operating assets. These assets are acquired as part
of a business combination. When a business combination results in
the acquisition of an entity whose only significant assets are its
exploration asset and/or rights to explore, the Directors consider
that the fair value of the exploration assets is equal to the
consideration. Any excess of the consideration over the capitalised
exploration asset is treated in the form of intangible exploration
asset. The Company sees no reason for any impairment in the value
of such intangible exploration asset and thus carry's the same as
an asset in its financials at present. The Company will continue to
assess this in its future financial statements and if and when
prudent, may consider reclassifying it to mine development
asset.
Derecognition of intangible assets
An intangible asset is derecognised on disposal, or when no
future economic benefits are expected from use or disposal. Gains
or losses arising from derecognition of an intangible asset,
measured as the difference between the net disposal proceeds and
the carrying amount of the asset, are recognised in profit or loss
when the asset is derecognised.
Inventories
Inventories are stated at the lower of cost and net realisable
value. Cost comprises direct materials and, where applicable,
direct labour costs and those overheads that have been incurred in
bringing the inventories to their present location and condition.
Cost is calculated using the weighted average method. Net
realisable value represents the estimated selling price less all
estimated costs of completion and costs to be incurred in
marketing, selling and distribution.
Investments
Investments in subsidiaries are held at cost less any
impairment.
Financial instruments
Financial assets and financial liabilities are recognised in the
Group's balance sheet when the Group becomes a party to the
contractual provisions of the instrument.
Financial assets
Initial recognition and measurement
The Group applies IFRS 9 "Financial Instruments" and elected the
simplified approach method.
The Group classifies its financial assets in the following
categories: loans and receivables and fair value through profit and
loss. The classification depends on the nature of the assets and
the purpose for which the assets were acquired. Management
determines the classification of its financial assets at initial
recognition and this designation at every reporting date.
Trade and Other Receivables
Loans and receivables are non - derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. The principal financial assets of the Company are loans and
receivables, which arise principally through the provision of goods
and services to customers (e.g., trade receivables) but also
incorporate other types of contractual monetary assets. They are
included in current assets, except for maturities greater than
twelve months after the balance sheet date. These are classified as
non-current assets.
The Group's loans and receivables comprise trade and other
receivables and cash and cash equivalents in the Consolidated
Statement of Financial Position.
Financial assets are measured upon initial recognition at fair
value plus transaction costs directly attributable to the
acquisition of the financial assets, except for financial assets
measured at fair value through profit or loss ("FVTPL") in respect
of which transaction costs are recorded in profit or loss. Other
financial assets are classified into the following specified
categories: financial assets as "at fair value through profit and
loss" and "loans and receivables". The classification depends on
the nature and purpose of the financial assets and is determined at
the time of initial recognition. The financial assets are
subsequently measured at amoritized cost except for assets
recognized at FVTPL.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at
call with banks and other short-term highly liquid investments with
maturities of three months or less. Bank overdrafts that are
repayable on demand and form an integral part of the Group's cash
management are included as a component of cash and cash equivalents
in the consolidated cash flow statement.
Financial assets - impairment
The Group assesses on a forward-looking basis the expected
credit losses associated with its instruments carried at amortized
cost and FVTPL"). The impairment methodology applied depends on
whether there has been a significant increase in credit risk. For
trade receivables, the Group applies the simplified approach
permitted by IFRS 9, which requires expected lifetime losses to be
recognised from initial recognition of the receivables.
Non-financial assets - impairment
At each balance sheet date, the Group reviews the carrying
amounts of its tangible and intangible assets, to determine whether
there is any indication that these assets have suffered an
impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated to determine the extent of the
impairment loss (if any). Provision is made for any impairment and
immediately expensed in the period.
The 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 (or 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 revalued
amount, in which case the impairment loss is treated as a
revaluation decrease.
Financial liabilities and equity instruments issued by the
Group
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into. An equity instrument is any contract that evidences a
residual interest in the assets of the Group after deducting all of
its liabilities. Equity instruments issued by the Group are
recorded at the proceeds received, net of direct issued costs.
Trade payables
Trade payables are initially measured at fair value, and are
subsequently measured at amortised costs, using the effective
interest rate method.
Leases
At inception of a contract, the Group assesses whether a
contract is, or contains, a lease. A contract is, or contains, a
lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys the right to
control the use of an identified asset, the Group uses the
definition of a lease in IFRS 16.
The Group recognises a right-of-use asset and a lease liability
at the lease commencement date. The right-of use asset is initially
measured at cost, which comprises the initial amount of the lease
liability adjusted for any lease payments made at or before the
commencement date, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying asset or
to restore the underlying asset or the site on which it is located,
less any lease incentives received.
The right-of-use asset is subsequently depreciated using the
straight-line method from the commencement date to the end of the
lease term, unless the lease transfers ownership of the underlying
asset to the Group by the end of the lease term or the cost of the
right-of-use asset reflects that the Group will exercise a purchase
option. In that case the right-of-use asset will be depreciated
over the useful life of the underlying asset, which is determined
on the same basis as those of property and equipment. In addition,
the right-of-use asset is periodically reduced by impairment
losses, if any, and adjusted for certain remeasurements of the
lease liability.
The lease liability is initially measured at the present value
of the lease payments that are not paid at the commencement date,
discounted using the interest rate implicit in the lease or, if
that rate cannot be readily determined, the Group's incremental
borrowing rate. Generally, the Group uses its incremental borrowing
rate as the discount rate.
The Group determines its incremental borrowing rate by based on
the rate at it which has secured borrowing and makes certain
adjustments to reflect the terms of the lease and type of the asset
leased. The lease liability is measured at amortised cost using the
effective interest method. It is remeasured when there is a change
in future lease payments.
When the lease liability is remeasured in this way, a
corresponding adjustment is made to the carrying amount of the
right-of-use asset or is recorded in profit or loss if the carrying
amount of the right-of-use asset has been reduced to zero.
Borrowings
These financial liabilities are all interest bearing and are
initially recognised at amortised costs and include the transaction
costs directly related to the issuance. The transaction costs are
amortised using the effective interest rate method over the life of
the liability.
Convertible Loan Notes are recorded at their issue price. Any
interest due on these CLNs is recorded on accrual basis. On
conversion/redemption the face value of converted CLNs is reduced
from the total carried value. Interest at 12% p.a. is paid
semi-annually. The Company has issued Convertible Loan note during
the year and in past. In reference to the Company's specific
circumstances and financial position, the convertibility offering
within the CLN's document is not assessable as a component in
exchange of a lesser coupon. The Company's policy on the conversion
option provided to the CLN subscribers was in exchange of not
getting to the direct equity placement, with conversion defined at
a premium to the price of the Company's shares at the time of issue
of CLN's thus reducing possible dilution for its existing
shareholders. Thus, the equity component of CLN's is not accounted
for as it is not considered to be material to the financial
statements.
Financial liabilities at Fair Value Through Profit or Loss
("FVTPL")
A financial liability is classified as at FVTPL if it is
classified as held-for-trading, it is a derivative or it is
designated as such on initial recognition. Financial liabilities at
FVTPL are measured at fair value and net gains and losses,
including any interest expense, are recognised in profit or
loss.
Other financial liabilities
Other financial liabilities are initially measured at fair
value, net of transaction costs. Other financial liabilities are
subsequently measured at amortised cost using the effective
interest method, as set out above, with interest expense recognised
on an effective yield basis. The Company's Lease Liability is
recorded.
Share based payments
Equity-settled share-based payments are measured at fair value
at the date of grant by reference to the fair value of the equity
instruments granted using the Black-Scholes model. The fair value
determined at the grant date is expensed on a straight-line basis
over the vesting period, based on the estimate of shares that will
eventually vest. A corresponding adjustment is made to equity.
When the terms and condition of equity settled share-based
payments at the time they were granted are subsequently modified,
the fair value of the share-based payment under the original terms
and conditions and under the modified terms and conditions are both
determined at the date of the modification. Any excess of the
modified fair value over the original fair value is recognised over
the remaining vesting period in addition to the grant date fair
value of the original share-based payment. The share-based payment
expense is not adjusted if the modified fair value is less than the
original fair value.
Cancellations or settlements are treated as an acceleration of
vesting and the amount that would have been recognised over the
remaining vesting period is recognised immediately.
4. Critical Accounting Estimates and Judgements
The preparation of financial statements in conformity with UK
adopted IAS requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities at the date
of the financial statements and the reported amounts of sales and
expenses during the reporting period. Although these estimates are
based on management's best knowledge of the amount, event or
action, actual results ultimately may differ from those
estimates.
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial period are discussed below.
a) Impairment of assets
The Company is required to test, on an annual basis, whether its
non-current assets have suffered any impairment. Determining
whether these assets are impaired requires an estimation of the
value in use of the cash-generating units to which the assets have
been allocated. The value in use calculation requires the Directors
to estimate the future cash flows expected to arise from the
cash-generating unit and a suitable discount rate to calculate the
present value. Subsequent changes to the cash generating unit
allocation or to the timing of cash flows could impact on the
carrying value of the respective assets. The Company uses factors
like estimated quantity of production and sales, basket price,
variable cost per ton, fixed costs, discounting rate and working
capital changes to judge the impairment of assets. The company has
done impairment testing taking in consideration for 10 years and
not 5 years as suggested by standard, because company believes it
is in project development stage and it will eventually take that
sufficient time to explore mine resources and get out economic
benefit of it.
Production assets
In accordance with the accounting principles and standards
followed by the Company under the relevant standards, we have
conducted an assessment of our capital assets to determine if there
are any indicators of impairment in the carrying value of capital
assets as at 31 March 2023. We are pleased to report that as of 31
March 2023, there are no indications of impairment for our capital
assets.
Components of capital assets of the Company including
exploration assets, drilling and mining equipment, processing plant
and equipment, Infrastructure and project development etc and form
a significant component of our balance sheet. These play a vital
role in generating current and future economic benefits for the
company. These assets have been valued appropriately, considering
their expected useful lives.
The total value of capital assets of the Company as at 31 March
2023 was as below:
a. At Cost : GBP 13,490,367
b. Book value : GBP 11,198,437
We regularly monitor various factors that could potentially
affect the value of our capital assets, such as changes in market
conditions, technological advancements, legal or regulatory
changes, and physical damage . An assessment of impairment of
production assets has been carried out by the Company considering
whether the net losses of the Company have impaired its production
assets and whether the net present value of the production assets
is lower than its book value and has come to the conclusion that
there is no impairment in the value of its production assets.
Impairment of intangible assets
The intangible exploration assets of the Company relate to the
excess of consideration paid over the book value as acquired at the
time of acquisition of the assets the Company holds in Madagascar,
which stood at GBP3,599,065 as at 31 March 2023 (2022:
GBP3,571,196). Such assets have an indefinite useful life as the
Group has a right to renew exploration licences and the asset is
only amortised once extraction of the resource commences.
Management tests for impairment annually whether exploration
projects have future economic value in accordance with the
accounting policy stated in Note 3. The company holds c.33 square
kilometres of flake graphite mining permits for forty years.
Currently the Company has reported mineral resource estimates for
only about 30% of identified mineral bearing zones. The Company
sees no indictors of impairment under IFRS6 as the licences remain
valid and further exploration is planned. The Companies net present
value assessments in relation assets show significant higher
potential as compared to the Book Value of the assets. Hence, the
Company finds no justification for impairment to be charged.
Useful economic lives of property, plant and equipment
The annual depreciation charge for different asset classes under
property, plant and equipment are charged considering the relevant
factors to that asset class. For all asset classes depreciation is
accounted for on the basis of norms set under the local regulations
which is in the range of 10 to 25% depending on the asset type
signifying useful life of 10 years or below. The Company has no
reasons to believe that the useful life of the assets is below
these. Thus, at the year end, Company assessed that there is no
requirement of changing the useful economic life of its assets.
In regard to Mine Development assets which is also a part of
property plant and equipment, this contains expenses relating to
costs incurred for determination of availability of graphite
deposits, ore resources and expenses related to developments of
mining for the purpose of providing raw material to the processing
plants that have been set up by the Company at its projects. The
Company adapted an unconventional path for its development the gist
of which is as below:
a. Alongside continuation of exploration, it evolved a
development path utilising its internal expertise. This path
envisaged modular development of production capacities alongside
continuation of graphite resources estimations made under JORC 2012
standards.
b. In 2019, SRK consulting assessed the first set of activities
performed by the company for the purpose of resource determination
and the CPR defined resources in the projects under Inferred and
Indicated categories.
c. According to conventional approach for development of mining
activities, this CPR was not enough for setting up mining and
processing facilities, but the Company preferred to commence
development of the projects on the back of its own expertise.
d. The development is also staged, and the capacities installed
by the Company to date are more of less 35% of the total that it
intends to install at these projects.
e. Given that the Company initiated production activities it
prudently preferred to account for amortisation of mine development
assets.
f. Since no ore reserves are established by the CPR and ongoing
investments continue in Mine Development arena it is not in
accordance with usual practices that the Company could consider
quantitative amortisation of the costs incurred under the head.
g. The Company therefore preferred to assess what will be the
minimum worst-case life of mine on its operations and this was
assumed as 10 years for worst case scenario.
h. The Company therefore adopted a flat 10% annual rate of
Amortisation for the Mine Development Assets for the past
years.
i. It is important to note that costs under this head will
continue to be incurred till such time that the Company continues
its exploration activities and will ultimately culminate into an
updated Competent Person Report engaged by the Company.
j. At this stage the Company may prudently consider to change
its method of amortisation of the Mine Development assets based on
quantitative considerations if it is so prudent to do.
Intragroup receivables
The Company assessed the recoverability of intragroup
receivables, and it does not require any impairment adjustment in
current financial year. This on the basis that the subsidiaries
have remained in investment mode until end of this year and it is
only now that the opportunity to produce at a annual rate that
leads to profitability of the subsidiaries have been achieved. The
Company shall review this status further at the end of FY24 to
assess further on Intragroup receivables.
b) Provision for restoration costs
The Company makes good any provision for the cost of
rehabilitating the end-of-life production sites and related
production facilities at the same time as production. The
rehabilitation costs are charged to the Income statement as
incurred. As is privy to the Group's environment and sustainability
initiatives management take note of the Environment Commitment Book
which underlines in-county regulations set out by the Malagasy
Government, and the environmental conditions within the mining
permit, which covers the Group's obligations towards restauration
and rehabilitation. The group has adopted a principle of ongoing
rehabilitation activities. The directors do not believe any further
provision Is required because the project areas in Madagascar are
located within a moderately undulating area and the Company's mine
planning takes this into consideration the topographic advantage.
In addition, the nature of the deposit and pit design is such that
rehabilitation and restoration of mining areas is an ongoing and
concurrent activity undertaken by the Group. In line with the
requirements of the licence, they have already incurred costs
relating to the construction of anti-erosion infrastructures, dam
cleaning, wall making, soil restoration and some reforestation of
areas.
Following limited and small-scale production to date, the
Group's operations after the year end will significantly increase
and management will therefore undertake another detailed analysis
of their environmental and restoration obligations following
increased activity in line with its second Sustainability Report
which shall be formulated against the Global Reporting Initiative
(GRI) Index, one of leading industry benchmarks which has been
adopted by the Company. The Sustainability Report will provide
deeper insights on the various mechanisms and steps taken by the
Company to meet their legal obligations and improve the lives of
people in some of the most deprived regions and its workplaces,
reduce environmental impacts and to have environment friendly
operations across the various legs of its business. The
Sustainability Report will also highlight the goals and targets set
by the Company for the longer-term and the green technologies
developed by the Company. Once this exercise is completed,
management will review the findings and assess whether any
activities are to be performed in this regard.
c) Recoverability of VAT
The Company has been regularly receiving VAT refunds generally
in 3-6 months of time and believes that the balance standing of GBP
1,058,832 in Trade and other receivables will be recovered in due
course. Hence there is no requirement of writing off such
assets.
d) Going Concern
The financial statements have been prepared on the basis that
the Company remains a going concern. The management's judgement are
based on the Company's current stage of development and estimated
future cash flows from operation and the ability of the Company to
raise funds if the need so be. The auditors have preferred to
include a material uncertainty in relation to going concern in
their audit opinion.
e) Capitalisation of Costs for development
The Company does not employ any Engineering and Construction
contractors for development of its projects and conducts mine and
infrastructure development activities also using its in house
resources including mining equipment fleet and human resources.
During the year the Company executed extensive development
activities across its projects along with operations of the
facilities that were completed. Adopting conservative principles
for capitalisation, the management uses its judgement for
capitalisation of reasonable part of those resources that are used
in development activities.
5. Revenue from Contracts with Customers
The Group & the company derives revenue from the transfer of
goods at a point in time in the following major product lines and
geographical regions:
2023 USA Europe Africa Asia Total
Revenue from external
customers 40,289 717,786 36,024 2,095,912 2,890,010
Timing of recognition:
------------------------ ------- -------- ------- ---------- ----------
At a point in time 40,289 717,786 36,024 2,095,912 2,890,010
------------------------ ------- -------- ------- ---------- ----------
2022 USA Europe Asia Total
Revenue from external
customers 34,000 224,033 1,387,275 1,645,308
======= ======== ========== ==========
Timing of recognition:
------------------------ ------- -------- ---------- ----------
At a point in time 34,000 224,033 1,387,275 1,645,308
------------------------ ------- -------- ---------- ----------
Following customers constituted more than 10% of the revenue,
their respective share of revenue is mentioned below:
2023 2022
GBP GBP
Customer A 895,809 224,033
------------ -------- --------
Customer B 471,867 488,330
------------ -------- --------
Customer C 408,780 287,247
------------ -------- --------
Customer D 339,710 430,429
Customer E 292,414 -
------------ -------- --------
Revenues of approximately GBP 2,408,580 (2022: GBP1,430,039) are
derived from 5 customers who each account for greater than 10% of
the group's & company's total revenues.
6. Cost of Sales
2023 2022
GBP GBP
---------- ----------
Expenses included in Cost of Sales:
---------- ----------
Mining & Processing Costs 1,512,563 935,064
---------- ----------
Human Resource Costs 326,783 378,671
---------- ----------
Logistics Utilities & Plan Admin Costs 368,061 308,278
---------- ----------
(Increase)/Decrease in Inventory of Inputs (676,058) (485,357)
---------- ----------
1,531,349 1,137,196
---------- ----------
7. Expenses by Nature
2023 2022
GBP GBP
The following items have been included
in arriving at operating loss
Depreciation on other assets 242,663 565,079
==================================================== ========== =========
Net foreign exchange gain (256,927) (95,171)
==================================================== ========== =========
PR/IR Expenses 118,865 131,885
==================================================== ========== =========
Professional Fees 223,460 124,454
==================================================== ========== =========
Insurance 127,617 27,941
==================================================== ========== =========
Director Emoluments 362,042 355,000
==================================================== ========== =========
Management Salary 405,793 569,179
==================================================== ========== =========
Brokerage 93,125 -
==================================================== ========== =========
R&D Expenses 82,807 -
==================================================== ========== =========
Other Admin Expenses 958,421 606,293
==================================================== ========== =========
Auditor's remuneration has been included
in arriving at operating loss as follows:
==================================================== ========== =========
Fees payable to the Company's auditor
and their associates for the audit of
the Company and consolidated financial
statements 82,500 55,000
Fees payable to the Company's auditor - -
and its associates for other services:
Corporate finance services - -
==================================================== ========== =========
8. Employee Information
The average monthly number of employees (including Executive
Directors) was:
2023 2022
Number of employees for the year: 474 290
GBP GBP
-------------------------------------------- ---------- ----------
Wages & salaries (for the above employees) 1,088,599 1,118,892
Social security costs 90,123 40,485
Share based payments - -
-------------------------------------------- ---------- ----------
1,178,722 1,159,377
-------------------------------------------- ---------- ----------
Directors' remuneration and transactions
2023 2022
GBP GBP
Directors' remuneration
=============================================== ======== ========
Emoluments and fees (gross of capitalisation) 482,042 764,000
=============================================== ======== ========
GBP GBP
----------------------------------------------- -------- --------
Remuneration of the highest paid director
(gross of capitalisation):
Emoluments and fees 320,000 320,000
=============================================== ======== ========
Payment in lieu of retirement benefits 30,000 30,000
=============================================== ======== ========
Bonus - 264,000
=============================================== ======== ========
Share based payments - -
----------------------------------------------- -------- --------
Refer to Directors Remuneration Report for further information
in respect of Directors' remuneration.
9. Finance Cost
2023 2022
GBP GBP
Interest Expense 251,641 140,209
------------------ -------- --------
10. Income Tax
2023 2022
GBP GBP
============ ============
Loss on ordinary activities before tax (2,357,910) (1,971,757)
============ ============
Loss on ordinary activities multiplied by
weighted average tax rate (459,792) (384,429)
============ ============
Minimum tax in Madagascar 9,775 5,946
============ ============
Tax on disallowed items 47,812 157,164
============ ============
Tax losses carried forward (deferred tax
not recognised) 411,981 173,048
============ ============
Net tax (credit) / charge 9,775 (48,271)
============ ============
Current tax charge 9,775 5,946
------------------------------ ------ ---------
Deferred tax (credit)/charge - (54,217)
------------------------------ ------ ---------
Net tax (credit)/ charge 9,775 (48,271)
====== =========
The Group has tax losses available to be carried forward and
used against trading profits arising in future periods of
GBP6,430,959 (2022: GBP4,371,054). A deferred tax asset of
GBP1,286,192(2022: GBP837,841) calculated at a weighted average
rate of 20% has not been recognised in respect of the tax losses
carried forward on the basis that there is insufficient certainty
over the level of future profits to utilise against this
amount.
From 1 April 2023 the corporation tax rate increased to 25% for
companies with profits of
over GBP250,000. A small profits rate has also been introduced
for companies with profits of
GBP50,000 or less so that they will continue to pay corporation
tax at 19%. From this date
companies with profits between GBP50,000 and GBP250,000 will pay
tax at the main rate
reduced by a marginal relief providing a gradual increase in the
effective corporation tax
rate.
The Company is loss-making at present and an assessment of the
impact of the change in
future tax rates is not possible at this stage.
11. Earnings Per Share
Basic and diluted
Earnings per share is calculated by dividing the loss
attributable to the equity holders of the Company by the weighted
average number of Ordinary shares in issue during the period.
2023 2022
Continuing operations:
-------------------------------------------- ------------ ------------
Loss attributable to equity holders of
the Company (GBP) (2,367,685) (1,923,486)
Weighted average number of ordinary shares
in issue 91,466,033 85,876,108
============================================ ============ ============
Loss per share (pence) (2.59) (2.24)
-------------------------------------------- ------------ ------------
The Dilutive instruments like warrants & CLNs issued by the
company are resulting in anti-dilutive effect on EPS. Hence diluted
EPS is shown as equal to basic EPS following IFRS requirements.
12. Intangible Assets
Group
Cost GBP
==========
At 1 April 2021 3,682,354
==========
Additions -
==========
Forex Change (111,158)
==========
At 1 April 2022 3,571,196
==========
Impairment -
==========
Forex Change 27,869
------------------- ----------
At 31 March 2023 3,599,065
------------------- ----------
Accumulated amortisation
At 1 April 2021 -
==========
Charge for the year -
==========
At 1 April 2022 -
==========
Charge for the year -
---------------------------- ----------
At 31 March 2023 -
==========
Net book value
==========
At 1 April 2021 3,682,354
==========
At 1 April 2022 3,571,196
==========
At 31 March 2023 3,599,065
----------------------------- ----------
Intangible assets comprise of excess of purchase consideration
paid in the acquisition of subsidiaries.
The projects in Madagascar have a current JORC compliant mineral
ore resource of 25.1 million tonnes which contains c.4% average
grade of graphite content. Further exploration across the two
projects is ongoing. The company has drilling resources to be
explored and believes that an economic target will be achieved in
future years hence impairment is not recognised. The Directors
undertook an assessment of the following areas and circumstances
that could indicate the existence of impairment:
-- The Group's right to explore in an area has expired, or will
expire in the near future without renewal;
-- No further exploration or evaluation is planned or budgeted for;
-- A decision has been taken by the Board to discontinue
exploration and evaluation in an area due to the absence of a
commercial level of reserves; or
-- Sufficient data exists to indicate that the book value will
not be fully recovered from future development and production.
Following their assessment, the Directors concluded that no
impairment charge was required at 31 March 2023.
13. Investments
Company Shares in group undertaking
Cost GBP
At 1 April 2021 3,539,448
Addition 361,575
At 1 April 2022 3,901,023
Addition 20,325
At 31 March 2023 3,921,348
------------------- -----------------------------
Net book value
================== =============================
At 1 April 2021 3,539,448
=================== =============================
At 1 April 2022 3,901,023
------------------- -----------------------------
At 31 March 2023 3,921,348
------------------- -----------------------------
The Company's investments at the Statement of Financial Position
date in the share capital of companies include the following:
Subsidiaries
Tirupati Madagascar Ventures
Registered: Lot II N 95 SB BIS E, Ambatobe, Antananarivo 103,
Madagascar
Nature of business: Graphite mining extraction
%
------------------------------------------------ ------------------------
Class of share Holding
Ordinary shares 98*
------------------------------------------------ ------------------------
*Tirupati Resources Mauritius was liquidated on 28(th) May 2021
and the shares have been transferred to Tirupati Graphite Plc.
Balance 1% each is held by Mr. Shishir & Mr. Hemant
respectively on behalf of the company.
Establissements Rostaing
Registered: Lot II N 95 SB BIS E, Ambatobe, Antananarivo 103,
Madagascar
Nature of business: Graphite mining extraction
%
------------------------------------------------ ------------------------
Class of share Holding
Ordinary shares 95*
------------------------------------------------ ------------------------
* Tirupati Resources Mauritius was liquidated on 28(th) May 2021
and the shares are transferred to Tirupati Graphite Plc. Balance 5%
is held by Mr. Shishir on behalf of the Company
14. Property, Plant and Equipment
Group Plant and Infrastructure Assets under construction Total
Machinery & Fixtures*
GBP GBP GBP GBP
-------------------- ----------- --------------- -------------------------- --------------------
Cost
=========== =============== ========================== ====================
At 1 April 2021 1,985,574 411,795 1,119,742 3,517,111
=========== =============== ========================== ====================
Additions 3,305,123 1,593,029 - 4,898,152
-------------------- ----------- --------------- -------------------------- --------------------
Reclassification 487,713 - (487,713) -
-------------------- ----------- --------------- -------------------------- --------------------
At 1 April 2022 5,778,410 2,004,824 632,029 8,415,263
=========== =============== ========================== ====================
Additions 2,758,118 422,381 1,894,605 5,075,104
=========== =============== ========================== ====================
Reclassification - 2,300,000 (2,300,000) -
=========== =============== ========================== ====================
At 31 March 2023 8,536,528 4,727,205 226,634 13,490,367
-------------------- ----------- --------------- -------------------------- --------------------
At 1 April 2021 401,254 92,809 - 494,063
=========== =============== ========================== ====================
Depreciation 482,641 82,438 - 565,079
-------------------- ----------- --------------- -------------------------- --------------------
At 1 April 2022 883,895 175,247 - 1,059,142
=========== =============== ========================== ====================
Depreciation 990,125 242,663 - 1,232,788
=========== =============== ========================== ====================
At 31 March 2023 1,874,020 417,910 - 2,291,930
-------------------- ----------- --------------- -------------------------- --------------------
Carrying amount
=========== =============== ========================== ====================
As at 1 April 2022 4,894,515 1,829,577 632,029 7,356,121
-------------------- ----------- --------------- -------------------------- --------------------
As at 31 March
2023 6,662,508 4,309,295 226,634 11,198,437
-------------------- ----------- --------------- -------------------------- --------------------
Company Assets under construction Total
GBP
GBP
-------------------------------------------------- -------------------------- --------------------
Cost GBP GBP
========================== ====================
At 1 April 2021 204,631 204,631
========================== ====================
Transfer to Subsidiary (204,631) (204,631)
-------------------------------------------------- -------------------------- --------------------
At 1 April 2022 - -
========================== ====================
Additions
========================== ====================
At 31 March 2023 - -
-------------------------------------------------- -------------------------- --------------------
At 1 April 2021 - -
========================== ====================
Depreciation - -
-------------------------------------------------- -------------------------- --------------------
At 1 April 2022 - -
========================== ====================
Depreciation - -
========================== ====================
At 31 March 2023 - -
-------------------------------------------------- -------------------------- --------------------
Carrying amount
========================== ====================
As at 1 April 2022 - -
-------------------------------------------------- -------------------------- --------------------
As at 31 March 2023 - -
-------------------------------------------------- -------------------------- --------------------
Note: Infrastructure & fixtures includes mine development
assets 2023: GBP1,492,474 (2022: GBP737,396) and right of use
assets 2023: GBP 58,599 (2022: GBP51,998)
15. Trade and Other Receivables
Group Company
2023 2022 2023 2022
GBP GBP GBP GBP
Trade receivables 710,600 532,370 710,600 532,370
Advance for Capex 287,039 2,592,163 287,039 2,592,163
VAT Refunds 1,058,832 942,458 7,451 12,274
Other debtors 50,209 106,423 - 2,898
Prepayments 16,424 69,220 16,424 99,221
Amounts owed by group undertakings - - 17,559,350 10,619,721
Advance for Acquisitions* 2,632,525 - 2,632,525 -
4,755,629 4,242,634 21,213,389 13,858,647
------------------------------------ ---------- ---------- ----------- -----------
*Note: Amounts advanced to Battery Minerals Limited in terms of
agreements entered into for securing placement of bank guarantee
and payment of capital gains tax so as to facilitate the approval
for completing the acquisition.
Trade receivables are amounts due from customers for goods sold
in the ordinary course of business. They are generally due for
settlement within 30-60 days and therefore are all classified as
current. Trade receivables are recognised initially at the amount
of consideration that is unconditional. The Group holds the trade
receivables with the objective to collect the contractual cash
flows and therefore measures them subsequently at amortised cost
using the effective interest method. All sales of the company are
in USD.
The Group applies the IFRS 9 simplified approach to measuring
expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected credit
losses, trade receivables have been grouped based on the days past
due.
At 31 March 2023 Current More More More Total
than than than
30 days 60 Days 90 days
GBP GBP GBP GBP GBP
-------- --------- --------- --------- ------
Expected loss rate 0% 0% 0% 80% 0%
-------- --------- --------- --------- ------
Gross trade receivables 710,600 - - - -
-------- --------- --------- --------- ------
Loss allowance - - - - -
-------- --------- --------- --------- ------
At 31 March 2022 Current More More More Total
than than than
30 days 60 Days 90 days
GBP GBP GBP GBP GBP
-------- --------- --------- --------- ------
Expected loss rate 0% 0% 0% 80% 0%
-------- --------- --------- --------- ------
Gross trade receivables 532,370 - - - -
-------- --------- --------- --------- ------
Loss allowance - - - - -
-------- --------- --------- --------- ------
Trade receivables are provided for when there is no reasonable
expectation of recovery. Indicators that there is no reasonable
expectation of recovery include, amongst others, the failure of a
debtor to engage in a repayment plan with the Group, and a failure
to make contractual payments for a period of greater than 120 days
past due. There are no significant known risks, and therefore no
provision is made as at 31 March 2022 & 31 March 2023.
16. Inventories
Group
2023 2022
Cost and net book value GBP GBP
Raw materials and consumables 457,997 563,923
Finished and semi-finished goods 928,561 168,351
1,386,558 732,274
---------------------------------- ---------- --------
17. Trade and Other Payables
Current:
Group Company
2023 2022 2023 2022
GBP GBP GBP GBP
Trade payables 1,084,991 548,906 243,500 188,534
Social security and
other taxes 48,913 18,817 - -
Amounts due from group - - - -
Accruals 550,994 163,146 491,940 126,673
1,684,808 730,869 735,440 315,207
------------------------ ---------- -------- -------- --------
In the Directors' opinion, the carrying amount of payable is
considered a reasonable approximation of fair value.
Non-current:
Group Company
2023 2022 2023 2022
GBP GBP GBP GBP
Lease liability 31,080 31,232 - -
----------------- ------- ------- ----- -----
31,080 31,232 - -
----------------- ------- ------- ----- -----
The Company has taken land on lease for Vatomina project for 18
years hence, there is no current maturity.
Lease liability is recognized in accordance with requirements of
IFRS 16. It requires a lessee to recognise assets and liabilities
for all leases with a term of more than 12 months, unless the
underlying asset is of low value. A lessee is required to recognise
a right-of-use asset representing its right to use the underlying
leased asset and a lease liability representing its obligation to
make lease payments.
Additional disclosure as per IFRS 16 is as follows:
Group
2023 2022
GBP GBP
Addition in lease liability & ROU asset 6,601 21,521
Interest charged during the year 3334 6,590
Amortization of Right to use asset (Incl.
in Infrastructure & fixtures) 2,643 1,955
=========================================== ====== =======
18. Provisions and Commitments
No provisions have existed within the financial year or persist
at year end. As regard the Company's capital commitments, the
ongoing development at its projects are substantially completed and
further developments will be made post further funding
arrangements. The acquisition of Suni Resources are commitments to
be satisfied in equity consideration.
19. Borrowings
The Company has issued two series 2019CLN's and 2022CLN's both
carrying coupon of 12% payable half yearly and convertible at the
holders' option at issue price as defined in the underlying
instrument, key terms thereof being as below:
Term CLN2019 CLN2022
Coupon 12% payable half yearly 12% payable half yearly
------------------------- ------------------------
Maturity 3 years from issue date 3 years from date
(verbally agreed to of issue
extend the maturity
date to 31(st) December
2024 post yearend)
------------------------- ------------------------
Conversion At the holders' option At the holders' option
------------------------- ------------------------
Conversion Price GBP0.45 per ordinary GBP0.60 for year 1
share being the IPO GBP0.75 for year 2
fund raise price per GBP0.90 for year 3
ordinary share
------------------------- ------------------------
During FY23 the Company received conversion notice for
GBP100,000 under the 2019CLN's which were converted into equity .
The Company raised gross proceeds of GBP1,862,500 under the 2022CLN
with transaction cost incurred of GBP93,125 being incurred. The
tables below summarise the balances on the closing date and changes
during the year. Optiva Securities Ltd is eligible to receive 5%
warrants of subscribed CLN2022 at issue price of 90p.
2023 2022
----------------------- ---------- ----------
Within one year 909,000 536,000
========== ==========
Between 2 and 5 years 1,862,500 473,000
----------------------- ---------- ----------
2,771,500 1,009,000
----------------------- ---------- ----------
Following table denotes changes in borrowings:
2023 2022
------------------------------------ ---------- ----------
Opening Balance as on 1(st) April 1,009,000 1,283,000
========== ==========
Issued during the year 1,862,500 -
========== ==========
Redeemed/Converted during the year (100,000) (274,000)
------------------------------------ ---------- ----------
Closing Balance as on 31(st) March 2,771,500 1,009,000
------------------------------------ ---------- ----------
The loan notes shall be redeemed by the Company, at any time
after the first anniversary of an Initial Public Offering up to the
Maturity Date or by the Noteholder or the Company, on the Maturity
Date being 3 years from date of issue.
Conversion can be made 15 Business Days after the date of
completion of a successful Initial Public Offering to convert all
of the Notes outstanding into fully paid Ordinary Shares at a price
equal to the price per Share paid by investors participating in the
Initial Public Offering.
20. Share Capital
2023 2023 2022 2022
Number GBP Number GBP
========================= ============= ==================== =========== ==========
Allotted, called up and
fully paid
Ordinary shares of 2.5p
each 1,01,447,768 2,536,195 86,939,832 2,173,497
Shares were issued during the year as follows:
Cost of issue Number of shares
(GBP) issued
--------------------------------- -------------- -----------------
Shares issued on conversion of
CLNs on 03 Oct 2022 - 222,222
Shares issued from a placing on
05 Dec 2022 250,000 14,285,714
============== =================
250,000 14,507,936
================================= -------------- -----------------
Note: The cost of issue of GBP 250,000 was settled against
consideration of equity raised and it is debited to the share
premium account. Optiva Securities Ltd is eligible to receive 5%
warrants to subscribe at issue price of 35p per warrant for the
transaction.
21. Share based Payments & Warrant Reserve
During the first two years after incorporation of the Company,
with the consent of its Board and senior management team, the
Company adopted a minimal approach to incentives and provided no
bonuses to the executive management team or the Board. However, to
show the appreciation of the Company, the Board was provided with
an annual incentive package in the form of warrants to subscribe
for equity shares of the Company at a premium to the prices at
which Ordinary Shares have been subscribed when the Company raised
equity in the relevant period. The Company has also provided broker
warrants to Optiva, on a success basis, for the fundraising
activities executed by it prior to Admission.
All warrants are equity-settled, in accordance with IFRS 2, by
award of warrants to acquire ordinary shares or award of ordinary
shares. The fair value of these awards has been calculated at the
date of grant of the award. The fair value of the warrants granted
was calculated using a Black-Scholes model. Changes in the
assumptions can affect the fair value estimate of a Black-Scholes
model.
Following are the key assumptions used to estimate the fair
value of the warrants issued:
a) Expected Volatility: 20%
b) Contractual Life of the warrant: 3 years
c) Risk free interest rate: 0.38% p.a.
Following warrants over ordinary shares have been granted by the
Company and are outstanding as on 31 March 2023:
Number of warrants
Expiry Date Exercise Price exercisable and
Grant Date (GBP) outstanding
31 December 2017 31 December 2025 0.300 1,000,000
------------------ ----------------- -------------------
31 December 2018 31 December 2025 0.400 1,520,000
------------------ ----------------- -------------------
31 March 2019 31 March 2025 0.400 320,000
------------------ ----------------- -------------------
31 December 2019 31 December 2025 0.400 1,620,000
------------------ ----------------- -------------------
31 March 2020 31 March 2025 0.400 480,000
------------------ ----------------- -------------------
15 June 2020 15 June 2023 0.675 222,222
------------------ ----------------- -------------------
15 June 2020 15 June 2023 0.900 222,222
------------------ ----------------- -------------------
30 June 2020 30 June 2023 0.675 22,800
------------------ ----------------- -------------------
14 December 2020 14 December 2023 0.450 170,329
------------------ ----------------- -------------------
14 December 2020 14 December 2023 0.675 113,553
------------------ ----------------- -------------------
20 April 2021 20 April 2024 1.350 222,222
------------------ ----------------- -------------------
Total 5,913,348
-------------------
The Company extended the expiry date of 4,940,000 warrants from
2022 to 2025 issued to Directors. This amounts to modification of
terms of warrant under IFRS 2 - Share Based Payments, the impact of
such modification is not material and therefore management has not
accounted for such modification.
Optiva Securities Limited is eligible for issue of following
share warrants during the year, but these have not yet issued:
Eligibility Expiry Date Exercise Price Eligible number
Date (GBP) of warrants
05 December 05 December
2022 2025 0.350 714,285
================= ==================== ================
08 August 2022 08 August 2025 0.900 103,472
================= ==================== ================
Total 817,757
================
The Company has not accounted for the warrants granted as they
have not been formally issued and the cost of such warrant is not
material.
Following table denotes changes warrants outstanding:
2023 2022
------------------------------------ ---------- ----------
Opening Balance as on 1(st) April 6,630,491 6,784,778
========== ==========
Issued during the year - 222,222
========== ==========
Exercised during the year - (376,509)
------------------------------------ ---------- ----------
Expired during the year (717,143) -
------------------------------------ ---------- ----------
Closing Balance as on 31(st) March 5,913,348 6,630,491
------------------------------------ ---------- ----------
In FY23, 640,000 warrants issued to management executives and
77,143 to brokers have expired.
Number Warrant
of warrants reserve
Warrants issued to outstanding GBP
Brokers 528,904 16,138
Members of the Board & executive management 4,940,000 54,566
CLN Investors 444,444 45,361
Total 5,913,348 116,065
--------------------------------------------- ------------- -------------
During the year, total of 640,000 warrants issued to management
executives and 77,143 to brokers have expired for which GBP14,173
is reversed back to retained earnings account and GBP319 is
reversed back to Share premium account respectively.
22. Financial Instruments
Financial risk management
The Group has exposure to the following risks from its use of
financial instruments:
-- Capital risk management
-- Market risk
-- Credit risk
-- Liquidity risk
-- Currency risk
This note presents information about the Group's exposure to
each of the above risks, the Group's management of capital, and the
Group's objectives, policies and procedures for measuring and
managing risk.
The Board of Directors has overall responsibility for the
establishment and oversight of the Group's risk management
framework.
The Group's risk management policies are established to identify
and analyse the risks faced by the Group, to set appropriate risk
limits and controls, and to monitor risks and adherence to limits.
Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Group's
activities.
The Group Audit Committee oversees how management monitors
compliance with the Group's risk management policies and procedures
and reviews the adequacy of the risk management framework in
relation to the risks faced by the Group.
Capital Risk Management
The Group manages its capital to ensure that entities in the
Group will be able to continue as a going concern while maximising
the return to stakeholders as well as sustaining the future
development of the business. In order to maintain or adjust the
capital structure, the Group may adjust dividends paid to
shareholders, return capital to shareholders, issue new shares or
sell assets to reduce debt.
The capital structure of the Group consists of net debt, which
includes loans, cash and cash equivalents, and equity attributable
to equity holders of the company, comprising issued capital and
retained earnings.
Fair value of financial assets and liabilities for the group
Valuation, Book value Fair value Book value Fair value
Methodology 2023 2023 2022 2022
and hierarchy GBP GBP GBP GBP
========================= =============== ============== ==================== =========== ===========
Financial assets
Cash and cash
equivalents (a) 289,338 289,338 1,534,023 1,534,023
Loans and receivables,
net of impairment (a) 4,755,629 4,755,629 4,242,635 4,242,635
========================= =============== ============== ==================== =========== ===========
Total at amortised
cost 5,044,967 5,044,967 5,776,658 5,776,658
========================================== ============== ==================== =========== ===========
Financial liabilities
Trade and other
payables (a) 1,684,808 1,684,808 730,869 730,869
Borrowings and
provisions (a) 2,771,500 2,771,500 1,009,000 1,009,000
Lease Liabilities (a) 31,080 31,080 31,232 31,232
Total at amortised
cost 4,487,388 4,487,388 1,771,101 1,771,101
------------------------------------------ -------------- -------------------- ----------- -----------
Fair value of financial assets and liabilities for the
company
Valuation, Book value Fair value Book value Fair value
Methodology 2023 2023 2022 2022
and hierarchy GBP GBP GBP GBP
========================= =============== ============== =================== =========== ===========
Financial assets
Cash and cash
equivalents (a) 130,340 130,340 1,505,410 1,505,410
Loans and receivables,
net of impairment (a) 21,213,389 21,213,389 13,858,647 13,858,647
========================= =============== ============== =================== =========== ===========
Total at amortised
cost 21,343,729 21,343,729 15,364,057 15,364,057
========================================== ============== =================== =========== ===========
Financial liabilities
Trade and other
payables (a) 735,440 735,440 315,207 315,207
Borrowings and
provisions (a) 2,771,500 2,771,500 1,009,000 1,009,000
Total at amortised
cost 3,506,940 3,506,940 1,324,207 1,324,207
------------------------------------------ -------------- ------------------- ----------- -----------
Valuation, methodology and hierarchy
(a) The carrying amounts of cash and cash equivalents, trade and
other receivables, trade and other payables and deferred income,
and Borrowings are all stated at book value. All have the same fair
value due to their short-term nature.
Market risk
Market price risk arises from uncertainty about the future
valuations of financial instruments held in accordance with the
Group's investment objectives. These future valuations are
determined by many factors but include the operational and
financial performance of the underlying investee companies, as well
as market perceptions of the future of the economy and its impact
upon the economic environment in which these companies operate.
Credit risk
Credit risk is the risk that counterparties to financial
instruments do not perform their obligations according to the terms
of the contract or instrument. The Group is exposed to counterparty
credit risk when dealing with its customers and certain financing
activities.
The immediate credit exposure of financial instruments is
represented by those financial instruments that have a net positive
fair value by counterparty at 31 March 2023.
The Group considers its maximum exposure to be:
2023 2022
GBP GBP
Financial assets
Cash and cash equivalents 289,338 1,534,023
Loans and receivables, net of impairment 4,755,629 4,242,635
------------------------------------------ ---------- ----------
5,044,967 5,776,658
------------------------------------------ ---------- ----------
The company considers its maximum exposure to be:
2023 2022
GBP GBP
Financial assets
Cash and cash equivalents 130,340 1,505,410
Loans and receivables, net of impairment 21,213,389 13,858,647
------------------------------------------ ----------- -----------
21,343,729 15,364,057
------------------------------------------ ----------- -----------
All cash balances are held with an investment grade bank who is
our principal banker. Although the Group has seen no direct
evidence of changes to the credit risk of its counterparties, the
current focus on financial liquidity in all markets has introduced
increased financial volatility. The Group continues to monitor the
changes to its counterparties' credit risk.
Liquidity risk
Liquidity risk is the risk the Group will encounter difficulty
in meeting its obligations associated with financial liabilities as
they fall due. The Board are jointly responsible for monitoring and
managing liquidity and ensures that the Group has sufficient liquid
resources to meet unforeseen and abnormal requirements. The current
forecast suggests that the Group has sufficient liquid
resources.
Available liquid resources and cash requirements are monitored
using detailed cash flow and profit forecasts these are reviewed at
least quarterly, or more often as required. The Directors decision
to prepare these accounts on a going concern basis is based on
assumptions which are discussed in the going concern note
above.
The following are the contractual maturities of financial
liabilities for the group:
6 to 1 to 2 to
Carrying Contractual 6 months 12 2 5
amount cash flows or less months years years
31 March 2023 GBP GBP GBP GBP GBP GBP
Non-derivative
financial liabilities
Trade and other
payables 1,684,808 - 1,684,808
Borrowings 2,771,500 - 909,000 - - 1,862,500
Lease Liability 31,080 - - - - -
31 March 2022
Non-derivative
financial liabilities
Trade and other
payables 730,869 - 730,869 - - -
Borrowings 1,009,000 - 116,000 420,000 473,000 -
Lease Liability 31,232 - - - - -
======================== ========== ============ ========== ======== ======== ===================
The following are the contractual maturities of financial
liabilities for the company:
6 to 1 to 2 to
Carrying Contractual 6 months 12 2 5
amount cash flows or less months years years
31 March 2023 GBP GBP GBP GBP GBP GBP
Non-derivative
financial liabilities
Trade and other
payables 735,440 - 735,440
Borrowings 2,771,500 - 909,000 - - 1,862,500
31 March 2022
Non-derivative
financial liabilities
Trade and other
payables 315,207 - 315,207 - - -
Borrowings 1,009,000 - 116,000 420,000 473,000 -
------------------------ ---------- ------------ --------- -------- -------- -------------------
Cash flow management
The Group produces an annual budget which it updates quarterly
with actual results and forecasts for future periods for profit and
loss, financial position and cash flows. The Group uses these
forecasts to report against and monitor its cash position. If the
Group becomes aware of a situation in which it would exceed its
current available liquid resources, it would apply mitigating
actions involving reduction of its cost base. The Group would also
employ working capital management techniques to manage the cash
flow in periods of peak usage.
Currency risk
The Group operates internationally and is exposed to foreign
exchange risk. Foreign exchange risk arises from future commercial
transactions and recognised assets and liabilities denominated in a
currency that is not the functional currency of the relevant Group
entity. The Group's primary currency exposure is to US Dollar,
which is the currency of all intra-group transactions as well as
denomination of selling price of the products. The group also has
some exposure to Malagasy ariary due to its operating subsidiaries
in Madagascar.
Considering the natural hedge available the Group currently
doesn't hedge the currency risk. The Group's and Company's exposure
to foreign currency risk at the end of the reporting period is
summarised below. All amounts are presented in GBP equivalent.
USD MGA USD MGA
Group 2023 2023 2022 2022
GBP GBP GBP GBP
Cash and cash equivalents 66,652 158,386 19,405 18,550
Trade & other receivables 997,639 1,101,590 3,127,431 1,003,709
Trade & other payables (243,500) (949,368) (188,534) (415,662)
--------------------------- ---------- ---------- ---------- ----------
Net Exposure 820,791 310,608 2,958,302 606,597
--------------------------- ---------- ---------- ---------- ----------
USD USD
Company 2023 2022
GBP GBP
Cash and cash equivalents 66,040 9,342
Loans to subsidiaries 15,153,109 9,797,683
Trade & other receivables 6,060,281 3,949,469
Trade & other payables (578,315) (224,937)
--------------------------- ----------- -----------
Net Exposure 20,701,115 13,531,557
--------------------------- ----------- -----------
Sensitivity Analysis
As shown in the table above, the Group is primarily exposed to
changes in the GBP:USD & GBP:MGA exchange rates. The table
below shows the impact in GBP on pre-tax profit and loss of a 10%
increase/ decrease in the GBP to USD exchange rate, holding all
other variables constant. Also shown is the impact of a 10%
increase/decrease in the GBP to MGA exchange rate, being the other
primary currency exposure.
2023 Group Company
GBP GBP
GBP:USD exchange rate increases by 10% 82,079 2,070,112
GBP:USD exchange rate decreases by 10% (82,079) (2,070,112)
======================================== ========= ============
GBP:MGA exchange rate increases by 10% 31,068 -
GBP:MGA exchange rate decreases by 10% (31,068) -
======================================= =========
2022 Group Company
GBP GBP
GBP:USD exchange rate increases by 10% 295,830 1,353,156
GBP:USD exchange rate decreases by 10% (295,830) (1,353,156)
======================================== ========== ============
GBP:MGA exchange rate increases by 10% 60,660 -
GBP:MGA exchange rate decreases by 10% (60,660) -
======================================= =========
23. Related Party Transactions
PranaGraf Materials and Technologies Private Limited (Formerly
known as Tirupati Speciality Graphite Private Limited) is an entity
incorporated in India. The Company is connected to TSG in that both
Shishir Poddar and Hemant Poddar were directors and shareholders of
TSG during the year. At year end, a net amount GBP333,253 (2022 -
GBP1,567,693) was receivable towards sale of goods with none
overdue. Revenue earned during the year amounted to GBP895,808
(2022 - GBP287,247), the Company purchased capital goods and
consumables of GBP1,764,805 (2022: GBP1,484,087), and incurred
service fees of GBP290,287 (2022: GBP235,795) towards back office
services received. Reimbursement of expenses of GBP204,220 (2022:
GBP143,334 ) towards travel and other expenses for the executives
of the Company was made during the year.
Haritmay Ventures LLP (HV) is an entity incorporated in India
and engaged in manufacturing proprietary tailor-made flake graphite
processing machinery and equipment which the Company uses in its
projects. The Company is connected to HV in that Shishir Poddar is
partner and shareholder of HV during the year. At year end, a net
amount of GBP287,039 (2022: GBP230,624) was receivable being
advance paid for long lead machinery purchase and the Company
purchased proprietary graphite processing machinery and spares of
GBP861,368 (2022: GBP1,132,398) during the year.
Optiva Securities Limited is an entity incorporated in the
United Kingdom. The Company is a stock brokerage firm connected to
the Company being the sole broker of the Company and Christian
Gabriel St.John-Dennis was one of the directors of the Company and
holding a position with Optiva Securities Limited during the year.
At year end, the Company incurred brokerage and consultancy fees,
business development fees of GBP343,125 (2022 : GBP440,000) and
brokerage and consultancy fees prepaid of GBP Nil (2022:
GBP6,250)
24. Deferred Tax Assets
2023 2022
------------------------------------ -------- -------
Brought forward DTA 75,242 21,182
======== =======
Created/(reversed) during the year - 54,217
======== =======
Forex (1,196) (157)
------------------------------------ -------- -------
Carried forward DTA 74,076 75,242
------------------------------------ -------- -------
25. Events after the Reporting Period
Acquisition of Suni Resources
On 1 April 2023 the Company completed the acquisition of Suni
Resources SA a private Company incorporated in Mozambique, which
holds two advanced stage graphite projects being:
(i) the Montepuez Project which holds the mining licence over an
area of 3,667 hectares with JORC 2012 defined reserves &
resources of almost 120 million tons; plus
(ii) the Balama Central Project, which has a mining licence over
1,543 hectares with JORC 2012 defined mineral reserves and
resources of 33 million tonnes. Both projects have licences
permitting build out to an annual production of 100,000 and
c.58,000 tons of flake graphite respectively.
Under the terms of the SPA and IP Assignment as varied, the
total aggregate consideration for the Acquisition is satisfied as
follows:
-- The issue of 10,046,556 TG ordinary shares of GBP0.025 each
to BAT covering a sum of AUD$9,750,000 (c.GBP5,284,500) at an issue
price of GBP0.526 per ordinary share in two equal tranches as
follows:
o 5,023,278 TG ordinary shares of GBP0.025 each issued at
Completion (the "Tranche 1 Consideration Shares"); and
o 5,023,278 TG ordinary shares of GBP0.025 each to be issued on
the eight month anniversary of Completion (the "Tranche 2
Consideration Shares").
-- Payment of a sum of AUD$5,428.14 in cash at Completion pursuant to the SPA.
-- The payment of a sum AUD$500,000 (c.GBP0.27 million) in cash
paid by the Company to BAT on 25 January 2023 pursuant to the IP
Assignment.
-- The issue of 2,018,944 ordinary shares of GBP0.025 each to BAT at Completion covering a sum of AUD$994,571.86 (GBP539,058) at an issue price of GBP0.267 per ordinary (the "IP Consideration Shares").
-- Payment of a sum of AUD$2,375,000 (c.GBP1,260,150) that has
been made pursuant to the variations of the SPA to facilitate the
payment of Capital Gains Tax by BAT in connection with the disposal
of Suni in consideration for which Suni agreed:
o to a AUD$1,250,000 (c.GBP677,500) reduction in the value of
Consideration Shares to be issued as consideration under the SPA
from AUD$11,000,000 (c.GBP5,962,000) to AUD$9,750,000
(c.GBP5,284,500);
o to the Company retaining the right to the VAT Refunds due to
Suni for historical spends by BAT and amounting to c.AUD$ 1.5
million (c.GBP810,000).
The Acquisition includes the entire equity capital of Suni (with
7,256 out of 241,868,268 of Suni shares in issue held by the
Executive Chairman of the Company as nominee on behalf of the
Company to satisfy local Mozambique requirements), shareholder debt
advanced by Battery Minerals Limited to Suni Resources S.A. and the
Battery Technical Information. Details of the assets acquired are
set out below:
-- Mining license over an area of 3,666.88 hectares for the
Montepuez Project vested with a JORC 2012 mineral reserves and
resources totalling 119.60 million tons with license to build the
project to 100,000 tons flake graphite production per annum in 2
stages of 50,000 tons each.
-- All infrastructure and assets on the ground at the
construction initiated Montepuez Project including, but not limited
to, (i) 100 persons base camp facilities, (ii) the developed
construction site for setting up the proposed processing facilities
(iii) the well-constructed tailing dam, and (iv) a mobile crusher
unit with capacity sufficient for the first 50,000 tons plant as
per the Montepuez Graphite Implementation Project document.
-- Mining license over an area of 1543.08 hectares for the
Balama Central Project vested with a JORC 2012 mineral reserves and
resources totalling 32.9 million tons and license to build the
project to 58,000 tons flake graphite production per annum.
-- Fixed deposits with NED Bank pledged for the issue of Bank
Guarantee in connection with the Projects amounting to >c.GBP2
million including cash remitted to Suni by the Company through BAT
amounting c.GBP970,000 to cover the bank guarantee issued for the
Balama Central Project.
-- All historical technical information on the projects.
-- Rights to the VAT Refunds.
The amount advanced by the company to BAT prior to 31(st) March
2023 included GBP970,000 now lying as fixed deposit with NED Bank
thus now being an asset of the company against which bank guarantee
has been issued by NED bank towards the Balma Central mining
license.
Extension of maturity of 2019CLN's
The Company has in issue 900,900 2019CLN's in issue as at 31
March 2023. The maturity of these were pegged at third anniversary
from the date of issue and conversion price pegged at GBP0.45 per
ordinary share. The Company engaged with its Brokers Optiva
Securities Limited to agree to extending the maturity of the
2019CLN's up to 31 December 2024 so that the Company conserves its
resources for its business being in formative stage and so that the
investors retain the opportunity to convert for a further period.
Optiva has confirmed that it has received consent from all holders
of the 2019CLN's for the extension and the Company has agreed to
pay a fee of 2% to Optiva for the arrangements. Accordingly, the
maturity of 2019CLN's is now considered extended to 31 December
2024.
S
For further information, please visit
https://www.tirupatigraphite.co.uk/ or contact:
Tirupati Graphite Plc
Puruvi Poddar - Chief of Corporate & admin@tirupatigraphite.co.uk
Business Development +44 (0) 20 39849894
Optiva Securities Limited (Broker)
Ben Maitland - Corporate Finance +44 (0) 20 3034 2707
Robert Emmet - Corporate Broking +44 (0) 20 3981 4173
FTI Consulting (Financial PR) +44 (0) 20 3727 1000
Ben Brewerton / Nick Hennis / Lucy Wigney tirupati@fticonsulting.com
About Tirupati Graphite
Tirupati Graphite Plc is a specialist flake graphite company and
places a special emphasis on "green" applications of flake
graphite, including renewable energy, energy efficiency, energy
storage and thermal management and is committed to ensuring its
operations are sustainable as well.
The Company's operations include primary mining and processing
in Madagascar, where the Company operates two key projects,
Sahamamy and Vatomina. With the start of commercial production of
its latest 18,000 tpa plant at Sahamamy in March 2023, it now has
an installed capacity of 30,000 tpa high-quality flake graphite
concentrate with up to 97% purity in Madagascar, planned to
increase to 84,000 tpa as per the Company's modular medium-term
development plan.
On 3rd April 2023 the Company completed the acquisition of Suni
Resources SA, Mozambique, whose two main assets are (i) the
Montepuez Project which holds the mining licence over an area of
3,667 hectares with JORC 2012 defined reserves & resources of
almost 120 million tonnes; plus (ii) the Balama Central Project,
which has a mining license over 1,543 hectares with JORC 2012
defined mineral reserves and resources of 33 million tonnes. Both
projects have licenses permitting build out to an annual production
of 100,000 and 58,000 tons of flake graphite respectively.
TG believes that the addition of these projects provides the
Company with sufficient resources to achieve its ambition of
satisfying 8% of the estimated global flake graphite demand - of
around 5 million tons per annum - by 2030.
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END
FR QLLFBXVLZBBB
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August 03, 2023 02:00 ET (06:00 GMT)
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