TIDMURU
RNS Number : 1668S
URU Metals Limited
29 September 2017
URU Metals Limited
("URU Metals" or "the Company")
Final Results
URU Metals is pleased to announce its final results for the year
ended 31 March 2017.
Chairman's Statement for the year ended 31 March 2017
I am pleased to present to our shareholders and stakeholders,
the consolidated financial statements of the Company for the year
ended March 31, 2017.
The past financial year has been a fruitful year for URU, with
achievements in obtaining financings and fulfilling investment
strategies. We are now well positioned to take advantage of
potential positive movements in the nickel market, as well as
positive trading at MRS following a difficult 2016 financial
period.
Henry Kloepper,
Executive Chairman
September 28, 2017
CEO's report for the year ended 31 March 2017
Below are the major events of the Company for the year ended 31
March 2017.
Zebediela Project
We are excited by the progress made in relation to the Zebediela
Project.
At the start of 2017 a new drilling campaign was undertaken on
the Zebediela project. It consisted of three new drill holes being
drilled on the Zebediela project (Z017, Z018, Z019). The main goal
of this campaign was to do infill drilling, drill test potential
extensions of the nickel (Ni) mineralisation, test the potential
magnetite mineralisation, and complete metallurgical test work on
the oxide and sulphide zones. The test work on the magnetite is
still ongoing. The drilling on Zebediela was completed in July 2017
and the assay results of drill holes Z019 and Z017 have been
reported to the market.
Burgersfort Ni Project
The Burgersfort Ni project was drill tested from 2010 to 2012
but was put on hold pending the outcome of a legal dispute between
URU and their BEE partners on the Zebedelia project. The dispute
has subsequently been settled and ongoing work at Burgersfort has
been on hold pending the outcome of additional metallurgical and
drilling testwork at URU's Zebedelia Ni project - which has many
similarities to Burgersfort.
Investment in Management Resource Solutions PLC
In March 2017 the Company acquired 7,550,000 shares of
Management Resource Solutions Plc ("MRS") from Scopn Pty Ltd.
("Scopn") at a price of GBP0.05 per share. As consideration the
Company issued Scopn 25,166,666 new shares of the Company (each at
an implied price of GBP0.045). In April 2017 the Company subscribed
for an additional 10,000,000 shares of MRS at a price of GBP0.05
per share for total cash consideration of GBP500,000 bringing the
Company's aggregate interest in MRS to 17,550,000 shares
(representing 10.06% of its current issued share capital). The
Company believes operational efficiencies can be realised to
restore MRS' profitability, and the potential exists for
significant revenue growth as a result of re-opening and/or
expanding of mining operations in New South Wales, coupled with the
continual demand for New South Wales coal from the Chinese market.
The Board believes the investment in MRS provides the Company with
a liquid investment with potential near-term upside.
On May 5, 2017, trading in MRS shares resumed on the AIM market
of the London Stock Exchange. Based on the closing middle market
share price of GBP0.045 per MRS share on September 20, 2017, the
value of the 7,550,000 MRS shares acquired on March 1, 2017 was
$460,000 ($1,173,000 as at March 31, 2017, based on the value of
the URU shares issued as acquisition consideration).
Strategy for 2017/2018, Advance Zebediela project
Our plans for 2017/2018 include investigation of the occurrence
of magnetite in both the oxide and the sulphide zones,
metallurgical test work on the magnetite and assessing the
potential for nickel extraction by acid and bioleaching compared to
previously envisaged floatation operation. Based on the positive
drill results from the most recent drilling campaign, URU plan to
expand on the potential PGE and high-grade nickel discoveries and
ultimately conduct updated feasibility studies on the Zebediela
Project. Further work will be predicated on the results of these
investigations.
URU remains committed to its strategy of acquiring mineral
assets, through:-
-- direct investments in companies with prospects with
medium-to-long term production potential;
-- partnership with other industry participants to develop
projects with production forecast in the near-to- medium term;
and
-- Investment of 100% equity in earlier-stage projects with the
potential to develop world-class sized mineral resources that could
be brought to market over the long-term.
URU would not rule out investing in longer-term, 100% equity
projects, or in other prospective junior companies should the right
opportunity arise. However, this would be dependent on investor
appetite at the time.
The Nickel Market
Overall positive trend - In September 2017, the nickel price
reached a two-year high on the back of the longest run of weekly
gains in a decade. The metals have been lifted by sustained demand
growth and decreasing supply. The World Bank believes that the
average Ni price for 2017 would be around $11,000 a ton and predict
an increase to $20,000 a ton by 2030.
Outlook - URU has a positive outlook on the nickel market. The
average nickel price for 2017 is expected to be $11,000 a ton, with
forecasts predicting it will reach $20,000 a ton by 2030.
The fastest growth today is seen in the newly and rapidly
industrializing countries, especially in Asia. Nickel-containing
materials are needed to modernize infrastructure, for industry and
to meet the material aspirations of their populations.
Your Management believes that our current projects have the
potential to deliver shareholder value and look forward to updating
shareholders on the development of Nickel projects in South
Africa.
John Zorbas, CEO
Consolidated Statements of Financial Position
(Expressed in thousands of United States Dollars)
-------------------------------------------------
As at As at
March 31, March 31,
2017 2016
---------------------------------------- --------- ---------
ASSETS
Non-current assets
Plant and equipment (note 7) $ 116 $ -
Intangible assets (note 8) 2,796 2,857
Long-term prepaid assets 41 41
Total non-current assets 2,953 2,898
Current assets
Marketable securities (notes 9 and 20) 1,173 -
Receivables (note 10) 30 171
Cash and cash equivalents 2,678 484
Total current assets 3,881 655
Total assets $ 6,834 $ 3,553
---------------------------------------- --------- ---------
EQUITY AND LIABILITIES
Equity
Share capital and premium (note 11) $ 54,449 $ 50,476
Shares to be issued (note 11 (ii) - 31
Reserves (note 12) 1,184 1,281
Accumulated deficit (49,476) (48,831)
Total equity 6,157 2,957
Current liabilities
Trade and other payables (note 13) 677 596
Total liabilities 677 596
Total equity and liabilities $ 6,834 $ 3,553
---------------------------------------- --------- ---------
The accompanying notes to the consolidated financial statements
are an integral part of these statements.
Nature of operations (note 2)
Commitment (note 19)
Subsequent events (note 20)
Approved on behalf of the Board:
"Henry Kloepper", Chairman
---------------------------
"Jay Vieira", Director
---------------------------
Consolidated Statements of Loss and Comprehensive Loss
(Expressed in thousands of United States Dollars)
------------------------------------------------------
Year Year
ended ended
March 31, March 31,
2017 2016
-------------------------------------------------------------------------------- ----------- -----------
Administrative expenses $ (670) $ (630)
Operating loss before the following item (670) (630)
Financing costs - (21)
Reclassification from foreign currency translation reserve (note 8) 25 -
Impairment of intangible assets and derecognition of contingent liability (notes
8 and 14) - (982)
Net loss for the year (645) (1,633)
Other comprehensive loss
Items that will be reclassified subsequently to income
Effect of translation of foreign operations (72) (61)
Other comprehensive loss for the year (72) (61)
Total comprehensive loss for the year $ (717) $ (1,694)
-------------------------------------------------------------------------------- ----------- -----------
Basic and diluted net loss per share (USD cents) $ (0.15) $ (0.60)
Weighted average number of common shares outstanding 443,928,720 270,763,658
-------------------------------------------------------------------------------- ----------- -----------
Consolidated Statements of Cash Flows
(Expressed in thousands of United States Dollars)
-------------------------------------------------
Year Year
ended ended
March 31, March 31,
2017 2016
----------------------------------------------------------- --------- ---------
Operating activities
Net loss for the year $ (645) $ (1,633)
Items not involving cash:
Depreciation 3 -
Interest accretion on long-term liability - 21
Gain on fair value adjustment on long-term liability - (163)
Reclassification from foreign currency reserve (25) -
Unrealized foreign exchange (gain)/loss (149) 40
Impairment of intangible assets - 1,145
Changes in non-cash working capital items:
Decrease (increase) in receivables 141 (145)
Increase in trade and other payables 203 240
Net cash used in operating activities (472) (495)
Investing activities
Additions to plant and equipment (119) -
Additions of intangible assets (8) (56)
Net cash used in investing activities (127) (56)
Financing activities
Proceeds from private placement, net of transaction costs 2,796 464
Net cash provided by financing activities 2,796 464
Gain on exchange rate changes on cash and cash equivalents (3) (3)
Net change in cash and cash equivalents 2,194 (90)
Cash and cash equivalents, beginning of year 484 574
Cash and cash equivalents, end of year $ 2,678 $ 484
----------------------------------------------------------- --------- ---------
Consolidated Statements of Changes in Shareholders' Equity
(Expressed in thousands of United States Dollars)
----------------------------------------------------------
Equity attributable to shareholders
Share Option Foreign Currency
Shares and Warrants
Share Share to be Translation Accumulated
Capital Premium Issued Reserve Reserve Deficit Total
----------------- ------- ------- ------ ------- ------- ----------- ------
Balance, March
31, 2015 $ 2,290 $ 47,660 $ - $ 2,307 $ (965) $ (47,198) $ 4,094
Shares issued in
private
placement 900 (344) 31 - - - 587
Shares issued for
professional
service 50 (19) - - - - 31
Transaction costs
incurred for
private
placement - (61) - - - - (61)
Net loss and
comprehensive
loss for the
year - - - (61) (1,633) (1,694)
----------------- ------- ------- ------ ------- ------- ----------- ------
Balance, March
31, 2016 $ 3,240 $ 47,236 $ 31 $ 2,307 $ (1,026) $ (48,831) $ 2,957
Shares issued in
private
placement 3,799 (1,141) (31) - - - 2,383
Shares issued for
professional
fees 235 (93) - - - - 142
Shares issued for
acquisition of
marketable
securities 252 898 - - - - 1,394
Fair value of
warrants issued - (57) - 57 - - -
Shares issued
through exercise
of warrants
issued in
private
placement 200 103 - (57) - - 246
Transaction costs
incurred for
share issuance - (223) - - - - (223)
Reclassification
of foreign
currency reserve
in SSOAB - - (25) - (25)
Net loss and
comprehensive
loss for the
year - - - - (72) (645) (717)
----------------- ------- ------- ------ ------- ------- ----------- ------
Balance, March
31, 2017 $ 7,726 $ 46,723 $ - $ 2,307 $ (1,123) $ (49,476) $ 6,157
----------------- ------- ------- ------ ------- ------- ----------- ------
Notes to Consolidated Financial Statements
March 31, 2017 and 2016
(Expressed in United States Dollars Except As Otherwise Indicated)
------------------------------------------------------------------
1. General information
URU Metals Limited (the "Company", or "URU Metals"), formerly
known as Niger Uranium Limited, and before that, as UraMin Niger
Limited, was incorporated in the British Virgin Islands ("BVI") on
May 21, 2007. The Company's shares were admitted to trading on AIM,
a market operated by the London Stock Exchange on September 12,
2007. The address of the Company's registered office is Intertrust,
P.O. Box 92, Road Town, Tortola, British Virgin Islands, and its
principal office is 702-85 Richmond Street West, Toronto, Ontario,
Canada, M5H 2C9.
The consolidated financial statements of the Company as at and
for the year ended March 31, 2017 comprise the Company and its
subsidiaries. These consolidated financial statements (including
the notes thereto) of the Company were approved by the Board of
Directors on September 28, 2017.
2. Nature of operations
During the year ended March 31, 2017, the Company's principal
business activities were the exploration and development of mineral
properties in South Africa.
The business of mining and exploring for minerals involves a
high degree of risk and there can be no assurance that planned
exploration and development programs will result in profitable
mining operations. The Company has not yet established whether its
mineral properties contain reserves that are economically
recoverable. Changes in future conditions could require material
write-downs of the carrying values of mineral properties.
The Company is in the exploration stage and is subject to the
risks and challenges similar to other companies in a comparable
stage of development. These risks include, but are not limited
to:
-- Dependence on key individuals;
-- receipt and maintenance of all required exploration permits and property titles;
-- successful development; and
-- as noted above, the ability to secure adequate financing to meet the minimum capital required
to successfully develop the Company's projects and continue as a going concern.
3. Basis of preparation
(a) Statement of compliance
The annual consolidated financial statements have been prepared
in accordance with International Financial Reporting Standards
("IFRS") and International Financial Reporting Interpretations
Committee ("IFRIC") interpretations. The Company has consistently
applied the same accounting policies throughout all periods
presented.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgment in the process of
applying the group's accounting policies. The areas involving a
higher degree of judgment or complexity, or areas where assumptions
and estimates are significant to the consolidated financial
statements are further disclosed within this note.
(b) Basis of measurement
The annual consolidated financial statements have been prepared
on a historical cost basis convention, as modified by the
revaluation of marketable securities at fair value through profit
and loss.
(c) Functional and presentation currency
Items included in the consolidated financial statements for each
entity in the Group are measured using the currency that best
reflects the economic substance of the underlying events and
circumstances relevant to that entity (the "functional currency").
Similarly, the Group reports its results in a specified currency
(the "presentation currency"). The functional and presentation
currencies (with their abbreviation defined in note 5) are set out
in the table below:
March 31, 2017
Functional Presentation
Group - USD
Subsidiaries:
URU Metals Limited ("URU") CAD -
Niger Uranium Societe Anonyme ("NUSA") CFA -
8373825 Canada Inc. ("Nueltin") CAD -
Svenska Skifferoljeaktiebolaget ("SSOAB") SEK -
Southern Africa Nickel Ltd. ("SAN Ltd") USD -
Umnex Minerals Limpopo Pty ("UML") USD -
Lesogo Platinum Uitloop Pty ("LPU") USD -
The Group's annual consolidated financial statements are
presented in US Dollars, rounded to the nearest thousand. In
accordance with IAS 21, Effects of Changes in Foreign Exchange
Rates ("IAS 21"), company entities and operations whose functional
currencies differ from the presentation currency are translated
into US dollars.
-- Monetary assets and liabilities are translated at the closing rate as at the date of the statement
of financial position;
-- Income and expenses are translated at the average rate of exchange for the reporting period;
-- Equity balances are initially translated at closing exchange rates and subsequent balances
are translated at historical rates; and
-- Translation gains and losses are recognized in consolidated other comprehensive income (loss),
and are reported as such in accumulated other comprehensive income (loss).
(d) Critical estimates and judgments
The preparation of the annual consolidated financial statements
in conformity with IFRSs requires management to make judgments,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected. The Group makes estimations and assumptions concerning
the future. The resulting accounting estimates may not equal the
related actual results.
Information about significant areas of estimation uncertainty
and critical judgments in applying accounting policies that have
the most significant risk and effect on the carrying amounts
recognised in the consolidated financial statements are included in
the following Notes:
Note 3 (c) Determination of Functional currency
Note 8 Valuation of Intangible assets
Note 9 Valuation of marketable securities
Note 12 Measurement of share options
Note 19 Completeness of Contingent liabilities and
commitments
4. Significant accounting policies
The accounting policies set out below have been applied
consistently to all periods presented in these consolidated
financial statements.
(a) Basis of consolidation
Subsidiaries
Subsidiaries are all 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.
Any contingent consideration to be transferred by the group is
recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is
deemed to be an asset or liability is recognised in accordance with
IAS 39 either in loss or other comprehensive loss.
Contingent consideration that is classified as equity is not
re-measured, and its subsequent settlement is accounted for within
equity.
Joint arrangements, joint operations and joint ventures
A joint arrangement is a contractual arrangement in which two or
more parties have joint control. Joint control only exists when
decisions require unanimous consent of the parties sharing that
control. A joint arrangement is either a joint operation, where the
parties have rights to the assets and obligations of the operation
and thus recognize its share of the assets, liabilities, and
operations, or a joint venture, where the parties have rights to
the net assets or the obligation, and thus recognize their interest
as an investment using the equity method.
Transactions eliminated on consolidation
Intra-group balances and transactions and any unrealised income
and expenses arising from intra-group transactions, are eliminated
in preparing the consolidated financial statements.
(b) Foreign currency transactions
i) Foreign currency transactions
Transactions in foreign currencies are translated to the
respective functional currencies of Group entities at exchange
rates at the dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions and from
the translation of monetary assets and liabilities denominated in
foreign currencies are recognised in consolidated statement of
loss.
Monetary assets and liabilities denominated in foreign
currencies at the reporting date are retranslated to the functional
currency at the exchange rate at that date. Non-monetary assets and
liabilities denominated in foreign currencies that are measured at
fair value are retranslated to the functional currency at the
exchange rate at the date that the fair value was determined.
Foreign currency differences arising on retranslation are
recognised in consolidated statement of loss.
ii) Foreign operations
The assets and liabilities of operations, including goodwill and
fair value adjustments arising on acquisition, are translated to
the Group presentation currency (where different) at exchange rates
at the reporting date. The income and expenses of foreign
operations are translated to the Group presentation currency at
average exchange rates, unless this average is not a reasonable
approximation of the cumulative effect of the rates prevailing on
the transaction dates, in which case income and expenses are
translated at the rate on the dates of the transactions. Equity
balances are translated to presentation currency at historical
exchange rates.
Foreign currency differences are recognised directly in other
comprehensive income and such differences have been recognised in
the foreign currency translation reserve (FCTR). When a foreign
operation is disposed of, in part or in full, the relevant amount
in the FCTR is transferred to profit or loss.
Foreign exchange gains and losses arising from a monetary item
receivable from or payable to a foreign operation, the settlement
of which is neither planned nor likely in the foreseeable future,
are considered to form part of a net investment in a foreign
operation and are recognised directly in other comprehensive income
in the FCTR.
(c) Plant and equipment
Recognition and measurement
Items of plant and equipment are measured at cost less
accumulated depreciation and accumulated impairment losses. The
cost of plant and equipment was determined by reference to the cost
at the date of acquisition.
Cost includes expenditure that is directly attributable to the
acquisition of the asset.
Gains and losses on disposal of an item of plant and equipment
are determined by comparing the proceeds from disposal with the
carrying amount of plant and equipment, and are recognised net
within consolidated statement of loss.
Subsequent costs
The cost of replacing part of an item of plant and equipment is
recognised in the carrying amount of the item if it is probable
that the future economic benefits embodied within the part will
flow to the Group and its cost can be measured reliably. The
carrying amount of the replaced part is derecognised. The costs of
the day-to-day servicing of plant and equipment are recognised in
profit or loss as incurred.
Depreciation
Depreciation is calculated over the depreciable amount, which is
the cost of the asset, less its residual value. If the useful lives
and depreciation methods are the same for significant parts of
assets, these are not depreciated on a component basis.
Depreciation is recognised in profit or loss on a straight-line
basis over the estimated useful lives of each part of an item of
plant and equipment.
The estimated useful lives for the current and comparative
periods are as follows:
field equipment 3 years
Depreciation methods, useful lives and residual values are
reviewed at each reporting date and adjusted if appropriate.
(d) Exploration costs and intangible assets
Exploration and evaluation costs are capitalized on a
project-by-project basis, pending determination of the technical
feasibility and the commercial viability of the project. In
accordance with IFRS 6, Exploration for and Evaluation of Mineral
Resources, the Company allocates costs incurred to cash generating
units (CGUs), which are projects, or groups of projects, which
share a consistent profile and proximity. Exploration costs are
presented in Intangible assets in the statement of financial
position.
Capitalized costs include costs directly related to the
exploration and evaluation activities in the CGU.
General and administrative costs are allocated to the
exploration property to the extent that the costs are directly
related to activities in the relevant areas of interest. Costs
incurred before the legal rights are obtained to explore an area
and costs relating to a relinquished or abandoned license are
recognized in consolidated statement of loss.
Exploration and evaluation assets shall be assessed for
impairment at each reporting period in accordance with IFRS 6, and
any impairment loss is recognized in the consolidated statement of
loss.
Once technical feasibility and commercial viability have been
established, exploration assets attributable to those projects are
tested for impairment and reclassified from exploration properties
to development properties.
Mineral property acquisition costs, and exploration and
development expenditures incurred subsequent to the determination
of the feasibility of mining operations and approval of development
by the Company, are capitalised until the property to which they
relate is placed into production, sold, allowed to lapse or
abandoned.
(e) Cash and cash equivalents
In the consolidated statement of cash flows, cash and cash
equivalents includes cash in hand, deposits held at call with banks
and other short-term highly liquid investments with original
maturities of three months or less.
(f) Financial instruments
A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity.
(i) Financial assets and financial liabilities
Financial assets and financial liabilities are classified into
one of three categories as summarised in the table below:
Derivative Initial Subsequent to initial URU's assets
Category status measurement recognition, held at: in the category
-------------- ----------- ------------------------------ -------------------------
Loans and receivables Non-derivative Fair value Amortised cost using the Receivables
effective interest method
Loans and receivables Non-derivative Fair value same as above Cash and cash equivalents
Other financial liabilities Non-derivative Fair value same as above Trade and other payables
Other financial liabilities Non-derivative Fair value Fair value through profit and Contigent consideration
loss
Financial assets at fair value Non-derivative Fair value Fair value through profit and Marketable security
loss
The classification is determined at initial recognition and
depends on the nature and the purpose of the financial asset.
Financial assets are recognized when the Company becomes a party to
the contractual provisions of the instrument.
Loans and receivables
Loans and receivables are non-derivative financial assets that
have fixed or determinable payments and that are not quoted in an
active market. Loans and receivables are initially recognized at
the fair value and subsequently carried at amortized cost less
impairment losses. If collection of other receivables is expected
in one year or less, they are classified as current assets. If not,
they are classified as non-current assets.
Other financial liabilities
The Group initially recognizes financial liabilities on the
trade date at which the Group becomes a party to the contractual
provisions of the instrument.
Financial liabilities are recognised initially at fair value
plus any directly attributable transaction costs.
Financial assets at fair value
Financial assets at fair value through profit or loss are
financial assets held for trading. A financial asset is classified
in this category if acquired principally for the purpose of selling
in the short term, or if it is a derivative financial instrument.
Assets in this category are classified as current assets if
expected to be settled within 12 months, otherwise, they are
classified as non-current. Securities in privately held companies
are initially recorded at cost, being the fair value at the time of
acquisition. At the end of each financial reporting period, the
Company's management estimates the fair value of investments based
on the criteria below and reflects such valuation in the
consolidated financial statements. These are included in Level 2 as
disclosed in note 5.
Securities that are traded on a recognized securities exchange
and for which no sales restrictions apply and for which an active
market exists, are recorded at fair values based on quoted closing
prices at the consolidated statement of financial position date or
the closing price on the last day the security traded if there were
no trades at the statement of financial position date. Securities
which are traded on a recognized securities exchange but which are
escrowed or otherwise restricted as to sale or transfer are
determined based on other observable market inputs.
Changes in fair values of financial assets through profit or
loss are presented as:
-- fair value gain or loss on investment in the consolidated statement of comprehensive income,
and
-- within operating activities in the statement of cash flows.
(ii) Derecognition of financial assets and financial
liabilities
A financial asset is derecognized when the contractual right to
the asset's cash flows expire or if the Company transfers the
financial asset and substantially all risks and rewards of
ownership to another entity. Any interest in transferred financial
assets that is created or retained by the Group is recognized as a
separate asset or liability.
The Group derecognizes a financial liability when its
contractual obligations are discharged or cancelled or expire.
(iii) Offset
Financial assets and financial liabilities are offset and the
net amount presented in the statement of financial position when
the Group has a legal right to offset the amounts and intends
either to settle on a net basis or to realize the asset and settle
the liability simultaneously.
(g) Impairment of assets
(i) Financial assets
Financial assets are assessed for indicators of impairment at
each reporting period end. Financial assets are impaired when there
is objective evidence that the estimated future cash flows of the
financial assets have been affected by one or more events that
occurred after the initial recognition of the financial asset.
An impairment loss in respect of a financial asset measured at
amortised cost is calculated as the difference between its carrying
amount and the present value of the estimated future cash flows
discounted at the assets original effective interest rate. Losses
are recognised in profit or loss and reflected in an allowance
account against receivables. Interest on the impaired asset
continues to be recognised. When an event occurring after the
impairment was recognised causes the amount of impairments loss to
decrease, the decrease in impairment loss is reversed through the
consolidated statement of loss.
(ii) Non-financial assets
The carrying amounts of the Group's non-financial assets are
reviewed at each reporting date to determine whether there is any
indication of impairment. If any such indication exists, then the
asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is
the greater of its value in use and its fair value less cost of
disposal. 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 the purpose
of impairment testing, assets are grouped together into the
smallest group of assets that generates cash inflows from
continuing use that are largely independent of the cash inflows of
other assets or groups of assets. Fair value less cost of disposal
is determined as the amount that would be obtained from the
disposal of the assets in an arm's length transaction between
knowledgeable and willing parties.
An impairment loss is recognised if the carrying amount of an
asset or its CGU exceeds its estimated recoverable amount.
Impairment losses are recognised in the consolidated statement of
loss.
Impairment losses recognised in prior periods are assessed at
each reporting date for any indications that the loss has decreased
or no longer exists. An impairment loss is reversed only to the
extent that the asset's carrying amount does not exceed the
carrying amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had been
recognised.
(h) Income tax
Income tax expense comprises current and deferred tax. Income
tax expense is recognised in the consolidated statement of loss
except to the extent that it relates to items recognised directly
in equity or other comprehensive loss.
Current tax is the expected tax payable on the taxable income
for the year, using tax rates enacted or substantively enacted at
the reporting date, and any adjustment to tax payable in respect of
previous years.
Deferred tax is recognised in respect of temporary differences
between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for the following
temporary differences: the initial recognition of assets or
liabilities in a transaction that is not a business combination and
that affects neither accounting nor taxable profit or loss, and
differences relating to investments in subsidiaries to the extent
that it is probable that they will not reverse in the foreseeable
future. In addition, deferred tax is not recognised for taxable
temporary differences arising on the initial recognition of
goodwill. Deferred tax is measured at the tax rates that are
expected to be applied to temporary differences when they reverse,
based on the laws that have been enacted or substantively enacted
by the reporting date. Deferred tax assets and liabilities are
offset if there is a legally enforceable right to offset current
tax liabilities and assets, and they relate to income taxes levied
by the same tax authority on the same taxable entity, or on
different tax entities, but they intend to settle current tax
liabilities and assets on a net basis or their tax assets and
liabilities will be realised simultaneously.
A deferred tax asset is recognised to the extent that it is
probable that future taxable profits will be available against
which the associated unused tax losses and deductible temporary
differences can be utilised. Deferred tax assets are reduced to the
extent that it is no longer probable that the related tax benefit
will be realised.
(i) Loss per share
The Group presents basic and diluted loss per share ("EPS") data
for its ordinary shares. Basic EPS is calculated by dividing the
profit or loss attributable to ordinary shareholders of the Group
by the weighted average number of ordinary shares outstanding
during the period. Diluted earnings or loss per share is similar to
basic earnings or loss per share, except that the denominator is
adjusted to include the dilutive potential ordinary shares that
would have been outstanding assuming that options and warrants with
an average market price for the year greater than their exercise
price are exercised and the proceeds used to repurchase ordinary
shares.
(j) Segment reporting
An operating segment is a component of the Group that engages in
business activities from which it may earn revenues and incur
expenses, including revenues and expenses that relate to
transactions with any of the Group's other components. All
operating segments' operating results are reviewed regularly by the
Group's Chief Operating Decision Maker, the CEO, to make decisions
about resources to be allocated to the segment and assess its
performance, and for which discrete financial information is
available.
(k) Employee benefits
Pension obligations and other post-employment benefits
The Group does not offer any pension and/or post-employment
benefits to employees.
Short-term employee benefits
Short-term employee benefits obligations are measured on an
undiscounted basis and are expensed as the related service is
provided. A liability is recognised for the amount expected to be
paid under short-term cash bonuses if the Group has a present legal
or constructive obligation to pay this amount as a result of past
service provided by the employee, and the obligation can be
estimated reliably.
Share-based compensation
The Group operates an equity-settled, share-based compensation
plan, The Niger Uranium Limited Share Option Plan 2008. The grant
date fair value of the employee services received in exchange for
the grant of the options is recognised as an expense with a
corresponding increase in equity, over the period that the
employees become unconditionally entitled to the awards. The total
amount to be expensed over the vesting period is determined by
reference to the fair value of the options granted, excluding the
impact of any non-market vesting conditions. Non-market vesting
conditions, such as forfeiture rates, are included in assumptions
about the number of options that are expected to vest. At each
reporting date, the entity revises its estimates of the number of
options that are expected to vest. It recognises the impact of the
revision of original estimates, if any, in consolidated statement
of loss, with a corresponding adjustment to equity.
(l) New accounting standards issued but not yet effective
IFRS 9 - Financial Instruments: Classification and Measurement
("IFRS 9")
IFRS 9 was issued in November 2009, and will replace IAS 39 -
Financial Instruments: Recognition and Measurement. IFRS 9 is
effective for periods beginning on or after January 1, 2018. The
Company is evaluating the impact of the amendments on its
consolidated financial statements, although currently they are not
expected to have a material impact.
IFRS 16 - Leases
Effective for annual periods beginning on or after 1 January
2019. The scope of IFRS 16 includes leases of all assets, with
certain exceptions. A lease is defined as a contract, or part of a
contract, that conveys the right to use an asset (the underlying
asset) for a period of time in exchange for consideration. IFRS 16
requires lessees to account for all leases under a single
on-balance sheet model in a similar way to finance leases under IAS
17 - Leases ("IAS 17"). The standard includes two recognition
exemptions for lessees - leases of 'low-value' assets (e.g.,
personal computers) and short-term leases (i.e., leases with a
lease term of 12 months or less). At the commencement date of a
lease, a lessee will recognise a liability to make lease payments
(i.e., the lease liability) and an asset representing the right to
use the underlying asset during the lease term (i.e., the
right-of-use asset). Lessees will be required to separately
recognise the interest expense on the lease liability and the
depreciation expense on the right-of-use asset. Lessees will be
required to remeasure the lease liability upon the occurrence of
certain events (e.g., a change in the lease term, a change in
future lease payments resulting from a change in an index or rate
used to determine those payments). The lessee will generally
recognise the amount of the remeasurement of the lease liability as
an adjustment to the right-of-use asset. Lessor accounting is
substantially unchanged from today's accounting under IAS 17.
Lessors will continue to classify all leases using the same
classification principle as in IAS 17 and distinguish between two
types of leases: operating and finance leases. Management believes
that IFRS 16 will not have a material impact on these consolidated
financial statements as all current leases are low value
leases.
5. Financial instruments
Fair value determination
Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The fair value
hierarchy establishes three levels to classify the inputs to
valuation techniques used to measure fair value. Level 1 inputs are
quoted prices (unadjusted) in active markets for identical assets
or liabilities. Level 2 inputs are quoted prices in markets that
are not active, quoted prices for similar assets or liabilities in
active markets, inputs other than quoted prices that are observable
for the asset or liability, or inputs that are derived principally
from or corroborated by observable market data or other means.
Level 3 inputs are unobservable (supported by little or no market
activity). The fair value hierarchy gives the highest priority to
Level 1 inputs and the lowest priority to Level 3 inputs. The
Company has no financial instruments carried at fair value as at
March 31, 2017 other than marketable security which is a level 2
financial assets at fair value.
Financial risk management
The Company's Board of Directors monitors and manages the
financial risks relating to the operations of the Company. These
include liquidity risk, credit risks and market risks which include
foreign currency and interest rate risks.
Credit risk
Credit risk is the risk of loss associated with a counterparty's
inability to fulfill its payment obligations. The Company's credit
risk is primarily attributable to the Company's cash and cash
equivalents and other receivables. The Company has no allowance for
impairment that might represent an estimate of incurred losses on
other receivables. The Company has cash and cash equivalents of
$2,678,000 (March 31, 2016 - $484,000), which represent the maximum
credit exposure on these assets. As at March 31, 2017, the majority
of the cash and cash equivalents were held with a major Canadian
chartered bank from which management believes the risk of loss to
be minimal.
Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another
financial asset. The Company's approach to managing liquidity is to
ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Company's reputation.
Typically the Company tries to ensure that it has sufficient
cash on demand to meet expected operational expenses for a period
of twelve months, including the servicing of financial obligations;
this excludes the potential impact of extreme circumstances that
cannot reasonably be predicted. Management monitors the rolling
forecasts of the Company's liquidity reserve on the basis of
expected cash flows.
The following are the contractual maturities of financial
liabilities:
6 months
(In thousands of United States Dollars) amount cash flows or less years
---------------------------------------- ------ ---------- ------- --------
March 31, 2017
Trade and other payables $ 677 $ 677 $ 677 $ -
---------------------------------------- ------ ---------- ------- --------
March 31, 2016
Trade and other payables $ 596 $ 596 $ 596 $ -
---------------------------------------- ------ ---------- ------- --------
Market risks
Market risk is the risk that changes in market prices, such as
foreign exchange rates, interest rates and equity prices will
affect the Company's loss or the value of its holdings of financial
instruments. The objective of market risk management is to manage
and control market risk exposures within acceptable parameters,
while optimising the return. The Company does not apply hedge
accounting in order to manage volatility in statements of loss.
Foreign currency rate risk
The Company, operating internationally, is exposed to currency
risk on purchases that are denominated in a currency other than the
functional currency of the Company's entities, primarily Pound
Sterling ("GBP"), the Canadian Dollar ("CAD"), the South African
Rand ("ZAR"), Swedish Krona ("SEK") and the US Dollar ("USD").
The Company does not hedge its exposure to currency risk.
In respect of other monetary assets and liabilities denominated
in foreign currencies, the Company's policy is to ensure that its
net exposure is kept to an acceptable level by buying or selling
foreign currencies at spot rates when necessary to address short
term imbalances.
The Company's exposure to foreign currency risk, based on
notional amounts, was as follows:
(In thousands of United States Dollars) USD GBP SEK CAD Total
---------------------------------------- --- ------ --- ---- ------
March 31, 2017
Cash and cash equivalents $ - $ 2,185 $ - $ 493 $ 2,678
Receivables - - - 30 30
Trade and other payable - (104) (74) (499) (677)
---------------------------------------- --- ------ --- ---- ------
March 31, 2016
Cash and cash equivalents $ 10 $ 463 $ 4 $ 7 $ 484
Receivables - - - 171 171
Trade and other payable - (139) (78) (379) (596)
---------------------------------------- --- ------ --- ---- ------
Interest rate risk
The financial assets and liabilities of the Company are subject
to interest rate risk, based on changes in the prevailing interest
rate. The Company does not enter into interest rate swap or
derivative contracts. The primary goal of the Company's investment
strategy is to make timely investments in listed or unlisted mining
and mineral development properties to optimise shareholder value.
Where appropriate, the Company will act as an active investor and
will strive to advance corporate actions that deliver value adding
outcomes. The Company will undertake joint ventures with companies
that have the potential to realize value through mineral project
development, and invest substantially in those joint ventures to
advance asset development over the near term.
Sensitivity analysis
A 10% strengthening of the USD against the following currencies
at March 31, 2017 would have increased/(decreased) equity and
profit or loss by the amounts shown below. This was determined by
recalculating the USD balances held using a 10% greater exchange
rate to the USD. This analysis assumes that all other variables, in
particular interest rates, remain constant.
March 31, 2017 March 31, 2016
(In thousands of United States Dollars) Equity Profit or loss Equity Profit or loss
---------------------------------------- ------- -------------- ------ --------------
GBP $ - $ (350) $ - $ (32)
CAD $ - $ (7) $ - $ 23
SEK $ - $ 7 $ - $ 7
---------------------------------------- -------- -------------- ------ --------------
6. Capital risk management
The Company includes its share capital and premium, reserves and
accumulated deficit as capital. The Company's objective is to
maintain a flexible capital structure which optimizes the costs of
capital at an acceptable risk. In light of economic changes and
with the risk characteristics of the underlying assets, the Company
manages the capital structure and makes adjustments to it. As the
Company has no cash flow from operations and in order to maintain
or adjust the capital structure, the Company may attempt to issue
new shares, issue debt and/or find a strategic partner. Neither the
Company nor any of its subsidiaries are subject to externally
imposed capital requirements.
The Company prepares annual expenditure budgets to facilitate
the management of its capital requirements and updates them as
necessary depending on various factors such as capital deployment
and general industry conditions. During the year ended March 31,
2017, there were no changes in the Company's approach to capital
management.
7. Plant and equipment
(In thousands of United States Dollars)
Field
------------------------------------------- -----
Balance, March 31, 2015 and March 31, 2016 $ -
Additions 120
Impact of foreign exchange (1)
Balance, March 31, 2017 $ 119
------------------------------------------- -----
Field
------------------------------------------- -----
Balance, March 31, 2015 and March 31, 2016 $ -
Depreciation for the year 3
Balance, March 31, 2017 $ 3
------------------------------------------- -----
Field
------------------ -----
At March 31, 2016 $ -
At March 31, 2017 $ 116
------------------ -----
8. Intangible assets
(In thousands of United States Dollars)
Exploration costs
----------------------------------------- ------------- ------ ------
South African
COST projects SSOAB Total
----------------------------------------- ------------- ------ ------
Balance, March 31, 2015 $ 4,795 $ 1,096 $ 5,891
Foreign exchange (133) 34 (99)
Additions - 56 56
Transfer to long-term prepaid assets (1) - (41) (41)
Impairment - (1,145) (1,145)
Balance, March 31, 2016 $ 4,662 $ - $ 4,662
Additions 8 - 8
Foreign exchange (113) (113)
Balance, March 31, 2017 $ 4,557 $ - $ 4,557
----------------------------------------- ------------- ------ ------
South Africa
ACCUMULATED AMORTIZATION AND IMPAIRMENT Project SSOAB Total
---------------------------------------- ------------ ----- -------
Balance, March 31, 2015 $ (1,852) $ - $ (1,852)
Foreign exchange 47 - 47
Balance, March 31, 2016 $ (1,805) $ - $ (1,805)
Foreign exchange 44 - 44
Balance, March 31, 2017 $ (1,761) $ - $ (1,761)
---------------------------------------- ------------ ----- -------
South African
CARRYING VALUE Projects SSOAB Total
------------------------ ------------- ----- ------
Balance, March 31, 2016 $ 2,857 $ - $ 2,857
Balance, March 31, 2017 $ 2,796 $ - $ 2,796
------------------------ ------------- ----- ------
(1) On determination that an impairment charge was required for
the company's SSOAB Narke project, the Company identified a long
term prepaid asset for future drilling costs that may be applied to
projects undertaken in other locations. Accordingly, the long-term
prepaid asset was transferred out of intangible assets.
SSOAB Licences
SSOAB (as defined in note 14) had 100% ownership of several
exploration licences near the town of Örebro, Sweden. The Swedish
licences are considered to be a single project, and thus to be one
CGU. During the year ended March 31, 2016, due to the continued
decline of the prices of oil and uranium, the Company decided not
to pursue the continued development of SSOAB properties and
therefore determined that the recoverable amount of the intangibles
under SSOAB properties was the value in use of the properties which
was estimated to be $nil. The Company recorded $1,145 impairment of
intangible assets in the consolidated statements of loss and
comprehensive loss for the year ended March 31, 2016. The foreign
currency reserve of SSOAB was reclassified from equity to the
consolidated statements of loss and comprehensive loss for the year
ended March 31, 2017.
Nueltin Licence
Nueltin was party to an option agreement with Cameco Corporation
("Cameco"), the holder of a licence located in the Nunavut
Territory of Canada. Under the agreement, the Company could earn
51% interest in the project from Cameco in return for exclusively
funding CDN$2.5 million in exploration expenditures by December 31,
2016. The Cameco project was considered to be one CGU. During the
year ended March 31, 2015, the Company wrote off the Nueltin
Licence in an amount $153 as the Company had no plan to pursue the
project in Nunavut Territory and the Company let the option
expire.
South African Projects
In November 2013, the Company acquired 100% interest in Southern
Africa Nickel Limited ("SAN Ltd.") which was the Company's joint
venture partner since 2010 on the Zebediela Nickel Project and 50%
interest in the Burgersfort Project. SAN Ltd in turn had a 74%
interest in a joint operation (the "SAN-Umnex Joint Venture"). The
remaining 26% was held by Umnex Mineral Holdings Pty ("UMH"), which
had title to the Zebediela licences through its subsidiary, UML.
With URU's acquisition of SAN Ltd., the SAN-URU joint venture was
dissolved and San Ltd. obtained ownership of the JV's 50% interest
in the Burgersfort Project with BSC resources as the other party to
the agreement.
On April 10, 2014, SAN Ltd. and UMH agreed that SAN Ltd. would
purchase 100% of UML from UMH for consideration of 33,194,181 in
new URU Metals shares and 8,000,000 bonus shares issued to
directors and officers for their services in the acquisition of
UML.
The Zebediela Nickel Project extends over three separate
adjacent prospecting rights in the Limpopo Province of South
Africa. All three rights are held by LPU which in turn is 100%
owned by UML.
All three rights are currently compliant with minimum
expenditure obligations, annual report submissions, annual
prospecting fees, and submitted prospecting work programs.
Under the terms of the acquisition agreement, UMH is permitted
to return the shares and take back the licences should URU
Metals:
-- fail to maintain adequate cash funds to meet its general and project expenditure obligations,
or
-- fail to meet the purchased rights' minimum statutory expenditure obligations
As at March 31, 2017, the "general and project expenditure
obligations" and the "minimum statutory expenditure obligations" of
the general and project expenditure obligations had not been
determined.
Additionally, conditional consideration of 12,000,000
free-trading shares is payable if either 1) a transaction is
consummated by URU Metals to sell, farm-out, or similarly dispose
of any portion of a mineral project on some or all of the mining
titles, or 2) a mining right is obtained from the South African
Department of Mines and Resources in respect of some or all of the
rights, or 3) an effective change of control of URU Metals occurs.
As at March 31, 2017, none of the above conditions have
occurred.
9. Marketable security
On March 1, 2017, the Company acquired 7,550,000 shares of
Management Resource Solutions Plc ("Management Resource") for
GBP0.15 per share by issuance of 25,166,666 common shares of the
Company. The fair value of the Management Resource shares was
determined to be the value of the URU shares issued, as Management
Resource was a public company whose shares were not trading at the
time and the market price was not available. As at March 31, 2017,
the trading in the shares of Management Resource was still
suspended and management determined to use the fair value of the
URU shares issued on March 1, 2017 of 3.7 pence per share as the
fair value of the Management Resource shares. Subsequent to year
end, the trading in the shares of Management Resource was resumed
(note 20) and the value of the shares had decreased to GBP0.045 per
share on September 20, 2017.
10. Receivables
As at As at
March 31, March 31,
(In thousands of United States Dollars) 2017 2016
---------------------------------------- --------- ---------
Receivables $ 30 $ 171
---------------------------------------- --------- ---------
11. Share capital and premium
(In thousands of United States Dollars except number of
shares)
Number of
shares Share capital Share premium Total
-------------------------------------------- ----------- ------------- ------------- -------
Balance, March 31, 2015 228,960,379 $ 2,290 $ 47,660 $ 49,950
Shares issued in private placement (i) 95,000,000 900 (344) 556
Shares issued for professional fees (i) 5,000,000 50 (19) 31
Transaction costs incurred for private
placement - - (61) (61)
--------------------------------------------- ----------- ------------- ------------- -------
Balance, March 31, 2016 328,960,379 $ 3,240 $ 47,236 $ 50,476
Shares issued in private placements
(ii)(iii)(iv)(v) 374,944,444 3,799 (1,141) 2,414
Shares issued for professional fees
(iii)(iv)(v) 23,499,999 235 (93) 142
Fair value of warrants issued (iv) - - (57) (57)
Shares issued upon exercise of warrants(vi) 20,000,000 200 46 246
Reclassification of fair value of warrants
upon exercise (vi) - - 57 57
Shares issued for acquisition of marketable
security(vii) 25,166,666 252 898 1,394
Transaction costs incurred for private
placement - - (223) (223)
--------------------------------------------- ----------- ------------- ------------- -------
Balance, March 31, 2017 772,571,488 $ 7,726 $ 46,723 $ 54,449
--------------------------------------------- ----------- ------------- ------------- -------
Issued shares
All issued shares are fully paid up.
Authorized: unlimited number of common shares. There are no
preferences or restrictions attached to any classes of common
shares.
(i) During the year ended March 31, 2016, the Company issued 95
million shares at GBP 0.004 per share for gross proceeds of
$525,000 and settlement of Chief Executive Officer ("CEO")
salaries, director fees and consulting fees of $62,000 and $31,000
consulting fees were settled against 5 million shares to be issued
at GBP 0.004 per share. Transaction costs of $61,000 were incurred
for the private placement. The CEO of the Company subscribed for 5
million shares in the private placement for settlement of CEO
salaries and director fees of $31,000.
(ii) On April 15, 2016, 5,000,000 shares to be issued in the
private placement as described above during the year ended March
31, 2016 were issued to the CEO of the Company in settlement of his
salaries.
(iii) On November 22, 2016, the Company issued 185,000,000
shares at GBP 0.004 for gross proceeds of $832,000 and settlement
of director fees and consulting fees of $87,000. Officers and
directors of the Company subscribed for 32,500,000 shares for
$161,000. Transaction costs of $81,000 were incurred.
(iv) On January 9, 2017, the Company issued 200,000,000 shares
at GBP 0.0045 for gross proceeds of $1,063,000 and settlement of
director fees and consulting fees of $30,000. Related parties
including Niketo Limited, a company with the common management of
URU and officers and directors of the Company subscribed for
31,111,111 shares for $170,000. Transaction costs of $105,000 were
incurred.
On January 9, 2017. the Company issued 20,000,000 warrants to
Adam International Investments Limited ("Adam International") with
each warrant exercisable at GBP0.01 for a share of the Company. The
fair value of the warrants was determined to be $57 using the Black
Scholes model with the following assumptions: risk free rate of
0.73%, dividend yield of 0%, expected life of 1 year, expected
volatility of 145.7%, exercise price of GBP 0.01 and share price of
GBP0.0059.
(v) On February 13, 2017, the Company issued 13,444,443 shares
at GBP 0.045 for gross proceeds of $732,000 and settlement of
director fees and consulting fees of $25,000. Related parties
including Niketo Limited, a company with the common management of
URU and officers and directors of the Company subscribed for
3,555,555 shares for $200,000. Transaction costs of $21,000 were
incurred.
(vi) On March 1, 2017, the Company issued 20,000,000 shares for
the exercise of the 20,000,000 warrants issued to Adam
International above for gross proceeds of $246,000.
(vii) On March 1, 2017, the Company issued 25,166,666 for
acquisition of 7,550,000 of Management Resources Solutions Plc
("MRS") from Scopn Pty Ltd. at a price of GBP0.15 per share.
Transaction costs of $7,000 were incurred.
Unissued shares
In terms of the BVI Business Companies Act, the unissued shares
are under the control of the Directors.
Dividends
Dividends declared and paid by the Company were $nil for the
year ended March 31, 2017 (year ended March 31, 2016 - $nil)
12. Share option reserve
(a) Share options
The Share Option Plan is administered by the Board of Directors,
which determines individual eligibility under the plan for
optioning to each individual. Below is disclosure of the movement
of the Company's share options as well as a reconciliation of the
number and weighted average exercise price of the Company's share
options outstanding on March 31, 2017.
The assessed fair value at grant date is determined using the
Black-Scholes Model that takes into account the exercise price, the
term of the option, the share price at grant date, the expected
price volatility of the underlying share, the expected dividend
yield and the risk-free interest rate for the term of the
option.
(i) Reconciliation of share options outstanding as at March 31,
2017:
Weighted Number of
average options originally Number
Exercise prices (GBP) remaining life (years) granted exercisable
---------------------- ---------------------- ------------------ -----------
0.049 3.56 2,633,334 2,633,334
0.020 (i) 0.15 8,500,000 8,500,000
0.030 0.95 11,133,334 11,133,334
---------------------- ---------------------- ------------------ -----------
(i) Subsequent to year end, 8,000,000 of these options were
exercised and the remaining 500,000 options expired unexercised
(note 20).
(ii) Continuity and exercise price
The number and weighted average exercise prices of share options
are as follows:
Weighted
average
Number exercise price
of options per share (GBP)
------------------------------------------- ---------- ---------------
Balance, March 31, 2015 13,133,334 0.03
Options expired unexercised (2,000,000) 0.03
Balance, March 31, 2016 and March 31, 2017 11,133,334 0.03
-------------------------------------------- ---------- ---------------
(b) Warrants
The following is a summary of the Company's warrants granted
under its Share Incentive Scheme. As at March 31, 2017, the
following warrants, issued in respect of capital raising, had been
granted but not exercised:
Fair value
Number of Exercise Expiry at
grant date
Name Date granted Date vested warrants price (GBP) date (GBP)
--------- ------------ ------------- --------- ----------- ------------ -----------
October 9, October 9, October 9,
Beaumont 2009 2009 100,000 0.345 2019 0.345
---------- -------------- ------------ --------- ----------- ------------ -----------
Refer to note 11(iv) for the issuance and exercise of 20 million
warrants during the year ended March 31, 2017.
13. Trade and other payables
As at As at
March 31, March 31,
(In thousands of United States Dollars) 2017 2016
---------------------------------------- --------- ---------
Other payables $ 291 $ 300
Accruals 386 296
$ 677 $ 596
---------------------------------------- --------- ---------
14. Contingent consideration on SSOAB purchase
On May 23, 2013, the Company announced that it had acquired all
the outstanding ordinary shares of a Swedish company, Svenska
Skifferoljeaktiebolaget ("SSOAB") from a private company. The
acquisition was made to obtain SSOAB's only significant assets: its
title to six exploration licences in Sweden, located in Örebro
County.
URU Metals paid the vendors $300,000 and issued 17 million
ordinary shares as consideration to the vendors for the purchase of
SSOAB. An additional 2.5 million ordinary shares, plus a cash
payment of $25,000, were paid as a finder's fee on the transaction.
A deferred payment of $200,000 was to be paid by URU Metals to the
vendors upon the completion of the first exploration drill program
on the property in the future. The agreement had not specified a
drilling timetable; management's best estimate was that it would be
on or about three years after acquisition (i.e. May 2016), although
the drilling would be contingent on the Company's cash position.
Coincident with the deferred payment would be a return to the
purchasers of cash and equivalents in the company at transfer of
SEK 132,000 ($21,000 at date of purchase).
During the year ended March 31, 2016, the Company decided not to
continue the drilling program and the contingent consideration of
$221,000 (comprising a purchase cost of $200,000 plus a return of
assets of $21,000) was discounted and de-recognized at fair value
of $nil. During the year ended March 31, 2017, the contingent
consideration was no longer recorded.
As at As at
March 31, March 31,
(In thousands of United States Dollars) : 2017 2016
------------------------------------------ ---------- ---------
Opening balance $ - $ 142
Accretion - 21
Derecognition of contingent consideration - (163)
$ - $ -
----------- ----------------------------------------- ---------
15. Related party transactions
(a) Transactions with key management personnel
During the year ended March 31, 2017, no stock options were
granted to key management personnel.
Details of stock options outstanding granted to directors,
management and past directors and management are as follows:
Weighted Number of
average options originally Expiry
Directors/officers exercise price (GBP) granted date
------------------- -------------------- ------------------ ------------
Directors
J. Vieira 0.02 2,000,000 May 23, 2017
D. Subotic 0.02 3,000,000 May 23, 2017
Management
J. Zorbas 0.02 3,000,000 May 23, 2017
8,000,000
------------------- -------------------- ------------------ ------------
The former CEO and director R. Lemaitre and former Chief
Financial Officer, R. Swarts resigned during the prior two years
and the Board of Directors confirmed that their options remained in
force until they expire or are unexercised.
All options held by management were exercised subsequent to
March 31, 2017 (note 20).
(b) Management remuneration
Year Year
ended ended
March 31, March 31,
(In thousands of United States Dollars) 2017 2016
---------------------------------------- --------- ---------
Fees for services as director $ 121 $ 36
Basic salary 158 236
Total $ 279 $ 272
---------------------------------------- --------- ---------
Please refer to note 11 (i)(ii)(iii)(iv)(v) for settlement of
CEO salaries and director fees for issuance of shares.
During the year ended March 31, 2017, the Company issued
15,833,333 shares and 444,444 shares to David Subotic and Jay
Vieira, respectively, for settlement of their director fees (note
11 (iii)(iv)(v)).
During the year ended March 31, 2016, the Company paid $12,000
to Jay Vieira, one of the directors of the Company for professional
services.
16. Loss before income tax
The following items have been charged in arriving at the
operating loss for the year:
(In thousands of United States Dollars)
March 31, March 31,
Note 2017 2016
----------------------------- ----- --------- ---------
Auditors' remuneration $ 63 $ 79
Directors' fees 121 36
Legal fees 36 56
Operating lease payments 32 32
Depreciation 3 -
Foreign exchange loss (gain)
Realized - 32
Unrealized (86) 47
Other professional fees 232 126
-------------------------------------- --------- ---------
17. Income tax expense and deferred taxation
The Company is incorporated in the British Virgin Islands (BVI).
The BVI under the Business Companies Act (BCA) imposes no corporate
or capital gains taxes. As such, the Company's losses will not
result in an income tax recovery in the BVI. However, the Company
as a Group may be liable for taxes in the jurisdictions where it
operates or develops mining properties.
Effective 13 July 2012, the Company became resident in Canada,
and is subject to income taxes at a combined federal and provincial
statutory tax rate of 26.5% (2016 - 26.5%).
Income tax expense from the amount that would be computed by
applying the Canadian federal and provincial statutory income tax
rates to the loss for the year is as follows:
2017 2016
--------------------------------- ----- -------
Loss for the year before taxes $ (645) $ (1,633)
Statutory tax rate 26.5% 26.5%
Expected income tax recovery (171) (433)
Benefit of losses not recognized 171 433
- -
--------------------------------- ----- -------
No deferred tax asset has been recognised because there is
insufficient evidence of the timing of suitable future profits
against which it can be recovered. No deferred tax liability has
been recognised as a result of the losses in the periods to
date.
The significant components of the Company's unrecognized
deductible temporary differences as at March 31, 2017 and 2016 are
as follows:
2017 2016
--------------------- ------- ------
Loss carry-forward $ 10,476 $ 9,768
Share issuance costs 234 74
Other $ 982 $ 982
--------------------- ------- ------
18. Segmented information
(a) Reportable segments
The Company has two reportable segments, as described below,
which are the Company's strategic business units. Both are
determined by the CEO, the Company's chief operating
decision-maker, and have not changed year-over-year. The strategic
business units offer different services, and are managed separately
because they require different strategies.
The following summary describes the operations in each of the
Company's reportable segments:
Exploration Includes obtaining licences and exploring these licence areas.
Corporate office Includes all Company administration and procurement
There are no other operations that meet any of the quantitative
thresholds for determining reportable segments during the year
ended March 31, 2017 or 2016.
There are varying levels of integration between the Exploration
and Corporate Office reportable segments. This integration includes
shared administration and procurement services.
Information regarding the results of each reportable segment is
included below. Performance is measured based on segmented results.
Any inter-segment transactions would be determined on an arm's
length basis. Inter-segment pricing for 2017 and 2016 consisted of
funding advanced from Corporate Office to Exploration.
(b) Operating segments
(In thousands of United States Dollars)
Exploration Corporate office Total
2017 2016 2017 2016 2017 2016
------------------------ ---- ------ -------- ------- ------ -----
Depreciation $ 3 $ - $ - $ - $ 3 $ -
Reportable segment loss
before tax $ 3 $ 1,003 $ 642 $ 630 $ 645 $ 1,633
------------------------ ---- ------ -------- ------- ------ -----
Exploration Corporate office Total
2017 2016 2017 2016 2017 2016
------------------------------- ------ ------ -------- ------ ------ ------
Reportable segment assets $ 2,878 $ 2,902 $ 3,956 $ 651 $ 6,834 $ 3,553
Reportable segment liabilities $ (10) $ (12) $ (667) $ (584) $ (677) $ (596)
------------------------------- ------ ------ -------- ------ ------ ------
(c) Geographical segments
During the year ended March 31, 2017 and 2016, business
activities took place in Canada and South Africa.
In presenting information based on the geographical segments,
segment assets are based on the geographical location of the
assets.
The following table presents segmented information on the
Company's operations and net loss for the year ended March 31, 2017
and assets and liabilities as at March 31, 2017:
(In thousands of United States Dollars) Canada Sweden South Africa Total
---------------------------------------- ------ ------ ------------ ------
Net loss $ 642 $ - $ 3 $ 645
Total assets $ 3,956 $ - $ 2,878 $ 6,834
Non-current assets $ 113 $ - $ 2,840 $ 2,953
Liabilities $ (667) $ (10) $ - $ (677)
---------------------------------------- ------ ------ ------------ ------
The following table presents segmented information on the
Company's operations and net loss for the year ended March 31, 2016
and assets and liabilities as at March 31, 2016:
(In thousands of United States Dollars) Canada Sweden South Africa Total
---------------------------------------- ------ ------ ------------ ------
Net loss $ 620 $ 1,003 $ - $ 1,633
Total assets $ 651 $ 45 $ 2,857 $ 3,553
Non-current assets $ - $ - $ 2,898 $ 2,898
Liabilities $ (584) $ (12) $ - $ (596)
---------------------------------------- ------ ------ ------------ ------
19. Commitments and Contingency
Commitments
Refer to notes 8 and 20(iii) for conditional consideration for
UML acquisition.
Contingency
The Company's former controller filed a law suit claiming
approximately $40,000 against the Company. URU delivered a defense
and counterclaim against the former controller. Documents have been
produced by the parties but there have not been any examinations
for discovery. At this stage, it is too early to evaluate the
relative strength of the claim, defense and counterclaim and no
amounts have been accrued in the consolidated financial statements
in relations to this matter.
20. Subsequent events
(i) In April 2017, 8 million stock options were exercised by the
officers and directors of the Company for a total proceeds of $126
(GBP100) and in relation to a director resignation settlement pay
of $76 (GBP60).
(ii) On April 19, 2017, 15,050,000 stock options with each
exercisable into a common share of the Company at GBP0.06 per share
were granted to officers, directors and consultants of the Company
and 15,150,000 stock options each exercisable into a common share
of the Company at GBP0.09 per share were granted to officers,
directors and consultants of the Company. The fair value of the
options was estimated at $72,038 (GBP52,256). The options vest in
five years.
(iii) On April 19, 2017, the Company entered into a Corporate
and Management Services Agreement (the "Agreement") with UMH. As
per the Agreement, UMH shall provide to UML services including
project management, coordination of mining rights application,
mineral rights management, finance and accounting, technical,
metallurgical, engineering and geological services and corporate
finance and capital raising. In exchange of the services, UMH will
earning the following fees:
1. Once the Bankable Feasibility Study commences a monthly
retainer of ZAR150,000 until then a monthly retainer of ZAR75,000
will be paid;
2. First right of offer for technical, metallurgical,
engineering and geological services at market related pricing;
3. Capital raising and corporate finance fees of 5% of the
transaction value of capital raised through UMH sources;
4. UMH will be issued a 1.5% royalty on all revenue generated
from the Zebediela project. 1% of the royalty can be purchased back
by URU or its successor for the amount of $2 million provided that
URU exercises this right within 24 months of the Mining Right being
issued by the Department of Mineral Resources of South Africa.
(iv) On May 5, 2017, the MRS shares resumed trading on the AIM
market of the London Stock Exchange. Based on the closing middle
market share price of GBP0.045 per MRS share on September 20, 2017,
the value of the 7,550,000 MRS shares acquired on March 1, 2017 was
$460 ($1,173 as at March 31, 2017, based on the value of the URU
shares issued as acquisition consideration).
This announcement contains inside information.
END
For further information, please contact:
URU Metals Limited +1 416 504 3978
John Zorbas
(Chief Executive Officer)
Northland Capital Partners Limited + 44 (0) 203 861 6625
(Nominated Adviser and Joint Broker)
Edward Hutton / Matthew Johnson
Beaufort Securities Limited + 44 (0) 207 382 8300
(Joint Broker)
Jonathan Belliss
SVS Securities Plc +44 (0) 203 700 0093
(Joint Broker)
Tom Curran
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UWUBRBVAKUAR
(END) Dow Jones Newswires
September 29, 2017 02:01 ET (06:01 GMT)
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