29 November 2017
Conroy Gold and Natural Resources plc
(“Conroy” or “the
Company”)
Final results for
the year ended 31 May 2017
Notice of AGM
Conroy (AIM: CGNR; ESM: CGNRI), the Irish based resource company
exploring and developing gold and other projects in Ireland, is pleased to announce its results
for the year ended 31 May 2017.
Highlights:
-
Clay Lake – Clontibret project: updated mineral resource
estimate to JORC standard showed a 26% increase of indicated
resource grade and a 23% increase in gold in the indicated
category
-
Strong geological evidence to suggest that the lodes have a more
extensive strike length than previously interpreted – up to at
least 850m. Mineralisation remains open in all directions.
-
Gold assay data from the 1950s pertaining to the underground
antimony mine workings at the Clontibret deposit became available.
This adds greatly to the understanding of the gold deposit and its
potential size and grade.
-
Work also continued on the Company’s other exploration
properties
Chairman, Professor Richard Conroy commented:
“I am very pleased that during the
course of the year the Company has continued to make significant
progress with its exploration and development programme. I
look forward to this continuing into 2018 as the Company moves
forward with its plans to develop a mine at Clontibret and targets
a multi-million ounce gold resource.”
Further Information:
Conroy Gold and
Natural Resources plc |
Tel:
+353-1-661-8958 |
Professor Richard
Conroy, Chairman |
|
Allenby Capital
Limited (Nomad) |
Tel:
+44-20-3328-5656 |
Virginia Bull/James
Thomas/Nick Harriss |
|
Beaufort Securities
(Broker) |
Tel:
+44-20-7382 8300 |
Jon Bellis/Elliot
Hance |
|
Lothbury Financial
Services |
Tel:
+44-20-3290-0707 |
Michael
Padley |
|
Hall
Communications |
Tel:
+353-1-660-9377 |
Don Hall |
|
Chairman’s Statement
Dear Shareholder:
I have pleasure in presenting your Company’s Annual Report and
Consolidated Financial Statements for the financial year ended
31 May 2017.
Business Development
Your Company has continued to make progress on the 65 km (40
miles) gold trend that it has discovered in the Longford-Down
Terrane in Ireland with a series
of gold targets discovered along the trend in which it is targeting
a multi-million ounce gold potential at Clay Lake – Clontibret in
the north east of its licence area. An updated mineral resource
showed an increase of indicated resource grade to 2.1 g/t Au in the
gold lodes and an increase to 320,000 ounces of gold in the
indicated category. Your Company is also continuing to progress
work on its planned open pit gold mine at Clontibret in
Co. Monaghan.
Clay Lake - Clontibret
Excellent drilling results during the year which included the
discovery of five new gold zones, together with high grades and
wide intersections of gold were reported at your Company’s
Clontibret gold deposit and an updated resource estimate by Tetra
Tech Canada, Inc. (“Tetra Tech”) represents an increase in gold
grade of 26 per cent and an increase in contained ounces in the
indicated category of 23 per cent (see Table 1).
The new resource estimate was developed to Joint Ore Reserve
Committee 2012 standard (“JORC 2012”) and represents a detailed
geological revision and update on the scoping study previously
undertaken by Tetra Tech (2011).
Classification |
Zone |
Tonnage |
Grade |
Metal |
Au
(g/t) |
Au
(Ozt) |
Indicated |
Lodes |
4,460,000 |
2.1 |
301,000 |
Stockwork |
500,000 |
1.2 |
19,000 |
Indicated Total |
|
4,960,000 |
2.0 |
320,000 |
Inferred |
Lodes |
2,980,000 |
2.0 |
193,000 |
Stockwork |
110,000 |
1.2 |
4,000 |
Inferred Total |
|
3,090,000 |
2.0 |
197,000 |
Table 1.
Summary of updated mineral resources for the Clontibret project
The Clontibret deposit comprises two styles of gold
mineralisation (i) lodes and (ii) stockwork. This updated resource
estimate focused on determining the grade and continuity of the
lode mineralisation where over 95% of the contained ounces
occur. The stockwork resource still contributes to the
overall contained ounces.
As part of this study, additional opportunities to increase the
size of the resource have been identified. There is strong
geological evidence to suggest that the lodes have a more extensive
strike length than previously interpreted – up to at least
850m. Mineralisation remains open in all
directions.
In total, 46 individual lodes and a stockwork body were
identified. The lodes generally have a north / south strike,
dipping to the west at between 60 and 70 degrees. The strike of the
stockwork zone trends north east / south west, dipping to the north
west at approximately 50 degrees. The mineralised lodes penetrate
into the stockwork body, terminating against the footwall of the
stockwork. The lodes and stockwork are distinct geological
domains.
During the year, gold assay data pertaining to the underground
antimony mine workings at the Clontibret deposit became available.
The samples were collected by an Irish-Canadian company during the
1950s and comprise detailed channel samples of the back (roof) and
walls of the drift and shafts. Detailed surveyed sample maps
and original ‘signed off’ assay sheets have been examined.
Your Company has been able to relate its own geological mapping
from the Clontibret stream, drilling data and the assay data from
the underground workings. The interpretation is that, within the
48m of underground development in the Tullybuck drift, the
following four gold bearing lodes occur (see Table 2).
|
Width (m) |
Grade (g/t Au) |
Lode
1 |
10.0 |
7.0 |
Lode
2 |
4.0 |
12.8 |
Lode
3 |
5.5 |
12.0 |
Lode
4 |
3.0 |
9.8 |
Table 2.
This newly available historic data from the underground working
adds to and correlates closely with the results of your Company’s
recent drilling and structural work at Clontibret and adds greatly
to our understanding of the Clontibret gold deposit and its
potential size and grade.
To assess the potential of the Clay Lake – Clontibret project to
host a significant amount of contained ounces, an Exploration
Target has been calculated under the JORC 2012 code (see Table 3
below).
An Exploration Target is an assessment of the exploration
potential of a mineral occurrence in a defined geological setting.
The potential quantity and grade is essentially conceptual in
nature, supported by drilling, trenching, geological mapping,
structural interpretation, prospecting, sampling, analyses and
nearby geological analogies.
Potential grade in g/t Au |
Contained ounces x 1000 |
1.00 |
1.50 |
2.00 |
2.50 |
3.00 |
3.50 |
4.00 |
4.50 |
5.00 |
5.50 |
%
drilling success |
14,012 |
21,018 |
28,023 |
35,029 |
42,035 |
49,041 |
56,047 |
63,053 |
70,058 |
77,064 |
25 |
11,209 |
16,814 |
22,419 |
28,023 |
33,628 |
39,233 |
44,837 |
50,442 |
56,047 |
61,651 |
20 |
8,407 |
12,611 |
16,814 |
21,018 |
25,221 |
29,425 |
33,628 |
37,832 |
42,035 |
46,239 |
15 |
5,605 |
8,407 |
11,209 |
14,012 |
16,814 |
19,616 |
22,419 |
25,221 |
28,023 |
30,826 |
10 |
2,802 |
4,204 |
5,605 |
7,006 |
8,407 |
9,808 |
11,209 |
12,611 |
14,012 |
15,413 |
5 |
1,401 |
2,102 |
2,802 |
3,503 |
4,204 |
4,904 |
5,605 |
6,305 |
7,006 |
7,706 |
2.5 |
Table 3.The table represents an ‘Exploration
Target’ under the JORC Code (2012) and does
notinclude the Clontibret deposit. The area
considered in the construction of the Exploration Target is
adjacent to the Clontibret deposit in the southwest, to the Clay
Lake deposit in the northeast.
The grade and
tonnage relating to the Exploration Target is conceptual in nature
and the geological information used in its construction includes
actual geochemistry, trenching, drilling and associated assays. The
calculations are based on coherent gold in soil anomalies (usually
greater than 10ppb Au) and representative ranges of the above
listed exploration data extrapolated to a depth of 200m.
An Exploration
Target is not, and must not be construed as, a Mineral Resource. It
is designed to provide guidance to the mineral exploration
potential of the defined area.
(This Exploration Target was
prepared by EurGeol Prof. Garth Earls PGeo, FSEG according to
Australasian Joint Ore Reserve Committee (JORC) Guidelines.)
Base metal and other gold targets
Exploration also continued for gold, zinc and other metals on
your Company’s other exploration properties in Ireland as well as for gold in Finland.
Extraordinary General Meetings
Your Company has, since the close of its financial year, had to
contend with a series of actions by a shareholder which have
hindered the Board of Directors and management from pursuing your
Company's business objectives as planned during the period. These
actions culminated in the holding of two separate extraordinary
general meetings and the bringing of a court action to overturn
certain of the results of the first meeting. While the Board of
Directors was successful in defending certain of these actions, the
distraction during the period has undoubtedly delayed the progress
of your Company's business.
Finance
The loss after taxation for the financial year ended
31 May 2017 was €431,922 (2016:
€292,165) and the net assets as at 31 May
2017 were €16,760,867 (2016: €17,113,858). Post year end,
your Company raised €240,000 by way of a subscription for ordinary
shares in your Company. The exercise of warrants by Managing
Director, Maureen T.A. Jones and I,
also raised approximately €166,680.
Auditors
I would like to take this opportunity to thank the partners and
staff of Deloitte for their services to your Company during the
course of the financial year.
Directors and staff
I would like to express my deep appreciation of support and
dedication of all the Directors, consultants and staff, which
despite all the difficulties, has made possible the continued
progress and success, which your Company has achieved.
I would like in particular to pay tribute to the outstanding
contributions made by Séamus P. FitzPatrick, James P. Jones, Dr. Sor?a Conroy, Louis J. Maguire, Michael E. Power and C.
David Wathen. Their experience and ability is a very
considerable loss to your Board of Directors.
I am very pleased to welcome Dr. Karl
Keegan and Brendan McMorrow
to your Board of Directors. Their knowledge and backgrounds will
significantly contribute to your Company.
Future outlook
Your Company has continued to make progress in its exploration
and development programme. I look forward to this continuing this
into 2018 as your Company moves to develop a mine at Clontibret and
targets a multi-million ounce gold resource.
________________________
Professor Richard Conroy
Chairman
28 November
2017
Consolidated income statement
for the financial year ended
31 May 2017
|
Note |
|
|
|
|
|
|
2017 |
|
|
2016 |
|
|
€ |
|
|
€ |
|
|
|
|
|
|
Continuing
operations |
|
|
|
|
|
Operating expenses |
|
(431,922) |
|
|
(291,486) |
Finance costs –
interest |
|
- |
|
|
(679) |
|
|
|
|
|
|
Loss before
taxation |
|
(431,922) |
|
|
(292,165) |
|
|
|
|
|
|
Income tax
expenses |
|
- |
|
|
- |
|
|
|
|
|
|
Loss for the
financial year |
|
(431,922) |
|
|
(292,165) |
|
|
|
|
|
|
Loss per
share |
|
|
|
|
|
Basic and diluted loss
per share |
3 |
(€0.0392) |
|
|
(€0.0479) |
Consolidated statement of comprehensive income
for the financial year ended
31 May 2017
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
|
€ |
|
|
€ |
|
|
|
|
|
|
Loss for the
financial year |
|
(431,922) |
|
|
(292,165) |
|
|
|
|
|
|
Income/expense
recognised in other comprehensive income |
|
- |
|
|
- |
|
|
|
|
|
|
Total comprehensive
expense for the financial year |
|
(431,922) |
|
|
(292,165) |
The total comprehensive expense for the financial year is
entirely attributable to equity holders of the Company.
Consolidated statement of financial position
as at 31 May
2017
|
Note |
31 May
2017 |
|
|
31 May
2016 |
|
|
€ |
|
|
€ |
Assets |
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
Intangible
assets |
|
19,659,104 |
|
|
18,696,602 |
Property,
plant and equipment |
|
15,116 |
|
|
16,150 |
Total
non-current assets |
|
19,674,220 |
|
|
18,712,752 |
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
Cash and
cash equivalents |
|
19,704 |
|
|
687,708 |
Other
receivables |
|
98,980 |
|
|
38,334 |
Total current
assets |
|
118,684 |
|
|
726,042 |
|
|
|
|
|
|
Total
assets |
|
19,792,904 |
|
|
19,438,794 |
|
|
|
|
|
|
Equity |
|
|
|
|
|
Capital and
reserves |
|
|
|
|
|
Called up
share capital |
|
11,014 |
|
|
11,014 |
Called up
deferred share capital |
|
10,504,431 |
|
|
10,504,431 |
Share
premium |
|
10,649,252 |
|
|
10,649,252 |
Capital
conversion reserve fund |
|
30,617 |
|
|
30,617 |
Share
based payments reserve |
|
1,542,961 |
|
|
1,464,030 |
Retained
deficit |
|
(5,977,408) |
|
|
(5,545,486) |
Total
equity |
|
16,760,867 |
|
|
17,113,858 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
Directors’
loans |
5 |
277,287 |
|
|
135,287 |
Total
non-current liabilities |
|
277,287 |
|
|
135,287 |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
Trade and
other payables |
4 |
2,754,750 |
|
|
2,189,649 |
Total current
liabilities |
|
2,754,750 |
|
|
2,189,649 |
|
|
|
|
|
|
Total
liabilities |
|
3,032,037 |
|
|
2,324,936 |
|
|
|
|
|
|
Total equity and
liabilities |
|
19,792,904 |
|
|
19,438,794 |
Consolidated statement of cash
flows
for the financial
year ended 31 May 2017
|
2017 |
|
|
2016 |
|
€ |
|
|
€ |
Cash flows from
operating activities |
|
|
|
|
Loss for the financial
year |
(431,922) |
|
|
(292,165) |
Adjustments
for: |
|
|
|
|
Depreciation |
3,779 |
|
|
1,833 |
Interest expense |
- |
|
|
679 |
Expense recognised in
consolidated income statement in respect of equity settled share
based payments |
15,346 |
|
|
68,026 |
Increase in
creditors |
460,066 |
|
|
237,389 |
(Increase)/decrease in
debtors |
(60,646) |
|
|
25,252 |
Net cash
(outflow)/provided by operating activities |
(13,377) |
|
|
41,014 |
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
Expenditure on
intangible assets |
(898,917) |
|
|
(858,769) |
Purchase of property,
plant and equipment |
(2,745) |
|
|
- |
Cash used in
investing activities |
(901,662) |
|
|
(858,769) |
|
|
|
|
|
Cash flows from
financing activities |
|
|
|
|
Loan from
Directors’ |
142,000 |
|
|
- |
Advances from Karelian
Diamond Resources P.L.C. |
105,035 |
|
|
- |
Issue of share
capital |
- |
|
|
1,800,367 |
Payments to Karelian
Diamond Resources P.L.C. |
- |
|
|
(201,955) |
Share issue costs |
- |
|
|
(60,015) |
Repayments of loan from
Director |
- |
|
|
(55,735) |
Interest paid |
- |
|
|
(679) |
Net cash provided by
financing activities |
247,035 |
|
|
1,481,983 |
|
|
|
|
|
(Decrease)/increase
in cash and cash equivalents |
(668,004) |
|
|
664,228 |
Cash and cash
equivalents at beginning of financial year |
687,708 |
|
|
23,480 |
Cash and cash
equivalents at end of financial year |
19,704 |
|
|
687,708 |
Consolidated statement of changes in
equity
for the financial
year ended 31 May 2017
|
Share
capital |
Share
premium |
Capital conversion reserve fund |
Share-
based payment reserve |
Retained
deficit |
Total
equity |
|
€ |
€ |
€ |
€ |
€ |
€ |
Balance at 1 June 2016 |
10,515,445 |
10,649,252 |
30,617 |
1,464,030 |
(5,545,486) |
17,113,858 |
Share-based
payments |
- |
- |
- |
78,931 |
- |
78,931 |
Loss for the financial
year |
- |
- |
- |
- |
(431,922) |
(431,922) |
Balance at 31 May 2017 |
10,515,445 |
10,649,252 |
30,617 |
1,542,961 |
(5,977,408) |
16,760,867 |
|
|
|
|
|
|
|
Balance at 1 June 2015 |
10,508,805 |
8,855,525 |
30,617 |
1,120,009 |
(5,193,306) |
15,321,650 |
Share issue |
6,640 |
1,793,727 |
- |
- |
- |
1,800,367 |
Share issue costs |
- |
- |
- |
- |
(60,015) |
(60,015) |
Share-based
payments |
- |
- |
- |
344,021 |
- |
344,021 |
Loss for the financial
year |
- |
- |
- |
- |
(292,165) |
(292,165) |
Balance at 31 May 2016 |
10,515,445 |
10,649,252 |
30,617 |
1,464,030 |
(5,545,486) |
17,113,858 |
1
Publication of non-statutory accounts
The financial information set out in this preliminary
announcement are abbreviated accounts as defined in Section 1119 of
the Companies Act 2014.
The financial information for the period ended 31 May 2017 has been extracted from the Company's
financial statements to that date which have received an
unqualified auditor’s report but have not yet been delivered to the
Registrar of Companies.
2
Going Concern
The Group and the Company incurred a loss of €431,922 (2016:
€292,165) for the financial year ended 31
May 2017 and had net current liabilities of €2,636,066 and
€2,354,768 respectively (2016: €1,463,607 and €1,182,409
respectively) at that date. The Directors and former Directors,
namely James P. Jones, Séamus P.
FitzPatrick, C. David Wathen,
Louis J. Maguire, Dr. Sor?a
Conroy and Michael E. Power, have
confirmed that they will not seek repayment of amounts owed to them
by the Group and the Company of €2,161,780 (2016: €1,741,824)
within 12 months of the date of approval of the financial
statements, unless the Group has sufficient funds to repay.
In addition, Karelian Diamond Resources P.L.C. has confirmed
that it does not intend to seek repayment of amounts owed to it at
31 May 2017 by the Group and the
Company of €273,800 (2016: €168,765) within 12 months of the date
of approval of the consolidated financial statements, unless the
Group has sufficient funds to repay. Amounts owed from Group
companies amounted to €281,300 (2016: €281,200) in the Company
statement of financial position.
The Board of Directors have considered carefully the financial
position of the Group and the Company and in that context, have
prepared and reviewed cash flow forecasts for the period to
30 November 2018. As set out in the
Chairman’s statement, the Group and the Company expects to incur
material levels of capital expenditure in 2018, consistent with its
strategy. In reviewing the proposed work programme for exploration
and evaluation of assets and on the basis of the equity raised
during past financial years, the funds received after the financial
year end, the results obtained from the exploration programme and
the prospects for raising additional funds as required, the Board
of Directors are satisfied that it is appropriate to prepare the
financial statements on a going concern basis.
3
Loss per share
The calculation of the loss per ordinary share of €0.0392 (2016
- €0.0479) is based on the loss for the financial year of €431,922
(2016 - €292,165) and the weighted average number of ordinary
shares in issue during the year of 11,013,537 (2016 –
5,295,110).
Since the Company incurred a loss, the effect of share options
and warrants would be anti-dilutive.
4
Trade and other payable
Group and
Company |
|
|
|
31 May
2017 |
|
31 May
2016 |
Amounts falling due
within one year |
|
|
|
€ |
|
€ |
Accrued Directors’
remuneration |
|
|
|
|
|
|
Fees and other emoluments |
|
|
|
1,356,445 |
|
1,584,649 |
Pension contributions |
|
|
|
121,000 |
|
157,175 |
Accrued former
Directors’ remuneration |
|
|
|
|
|
|
Fees and other emoluments |
|
|
|
613,160 |
|
- |
Pension contributions |
|
|
|
71,175 |
|
- |
Other accruals |
|
|
|
319,170 |
|
279,060 |
Amounts owed to Karelian
Diamond Resources P.L.C. |
273,800 |
|
168,765 |
|
|
|
|
2,754,750 |
|
2,189,649 |
It is the Group’s practice to agree terms of transactions,
including payment terms with suppliers. It is the Group’s policy
that payment is made according to the agreed terms. The carrying
value of the trade and other payables approximates to their fair
value.
The Directors and former Directors, namely James P. Jones, Séamus P. FitzPatrick,
C. David Wathen, Louis J. Maguire, Dr. Sor?a Conroy and Michael E. Power, have confirmed that
they will not seek repayment of amounts owed to them by the Group
and the Company of €2,161,780 (2016: €1,741,824) for a minimum
period of 12 months from the date of approval of the consolidated
financial statements, unless the Group has sufficient funds to
repay.
In addition, Karelian Diamond Resources P.L.C. has confirmed
that it will not seek repayment of amounts owed to it by the Group
and the Company at 31 May 2017 of
€273,800 (2016: €168,765) within 12 months of the date of approval
of the consolidated financial statements, unless the Group has
sufficient funds to repay. During the financial year ended
31 May 2017, €383,845 (2016: €43,778)
was paid by Karelian Diamond Resources P.L.C to the Company. For
the financial year ended 31 May 2017,
the Company incurred costs totalling €278,810 (2016: €245,773) on
behalf of Karelian Diamond Resources P.L.C.
5
Non-current financial liabilities – Group and Company
Directors’ loan
|
|
|
|
31 May
2017 |
|
31 May
2016 |
|
|
|
|
€ |
|
€ |
Opening balance 1
June |
|
|
|
135,287 |
|
191,022 |
Loan advance |
|
|
|
142,000 |
|
- |
Loan repayment |
|
|
|
- |
|
(59,130) |
Interest charge for the
financial year |
|
|
|
- |
|
3,395 |
Closing balance 31 May |
|
|
|
277,287 |
|
135,287 |
The Directors’ loan amounts relate to monies owed to Professor
Richard Conroy amounting to €232,287
(2016: €127,287), and Maureen T.A. Jones amounting to €45,000
(2016: €8,000). The Directors’ loan amounts have been partly repaid
post year end (€166,680).
6 Post balance
sheet events
At the Extraordinary General Meeting (“EGM”) of the Company held
on 4 August 2017, resolutions
proposed by Mr. Patrick O’Sullivan
(a substantial shareholder in the Company), in accordance with
Section 146 of the Companies Act 2014 were passed which resulted in
the immediate removal of the following Directors: James P. Jones (Finance Director), Séamus P.
FitzPatrick (Deputy Chairman), C. David
Wathen, Louis J. Maguire, Dr.
Sor?a Conroy and Michael E. Power
(non-executive Directors). Resolutions to appoint Paul Johnson, Gervaise
Heddle and Patrick O’Sullivan (“Mr. O’Sullivan”) to the
Board of Directors, were, upon advice from the Company’s Irish
legal counsel, declared of no effect by reason of non-compliance
with the provisions of the Company's constitution.
On 26 September 2017, the High
Court in Dublin held in favour of
the Company in the case brought against it by Mr. O'Sullivan, in
which Mr. O’Sullivan claimed that he and his nominees,
(Paul Johnson and Gervaise Heddle) were appointed to the Board of
Directors of the Company at the Company's EGM held on 4 August 2017. The Judge found that Mr.
O’Sullivan did not comply with the notification requirements under
the Articles of Association of the Company in advance of the
extraordinary general meeting and that there was nothing improper
or untoward in the actions of the chairman at the meeting.
Accordingly, all of the reliefs sought by Mr O’Sullivan, which
included a declaration that he and the other two individuals
nominated by him were entitled to be appointed to the Board of
Directors, were refused by the Court.
The Company announced on 10 October
2017, that the High Court had awarded costs, with a stay on
that order pending any appeal, to the Company in respect of the
case brought by Mr. O’Sullivan.
The Company announced on 10 October
2017 that it is to cancel the admission of its ordinary
shares to trading on the Enterprise Securities Market (“ESM”) on
the Irish Stock Exchange on 6 November
2017. This cancellation occurred on 6
November 2017.
Post year-end the Company raised €240,000 by way of a
subscription for ordinary shares in the Company. The exercise of
warrants by the Chairman and Managing Director also raised
approximately €166,680.
7 Copies of
Accounts & Notice of AGM
A copy of the
audited consolidated financial statements will be available on the
Company’s website www.conroygold.com and will be available from the
Company’s registered office at 3300 Lake Drive, Citywest Business
Campus, Dublin 24, D24 TD21,
Ireland. It will also be posted to
shareholders who requested a hard copy. Notice of the Annual
General Meeting to be held on 21 December
2017 and proxy form have also been posted to shareholders
and are available on the website.