Karelian Diamond Resources Plc - Half-yearly results for the six months ended 30 November 2023
(“Karelian” or “the Company”)
Half-yearly results for the six months ended
Highlights of the half-year period included:
-- The proceedings to establish the mining concession for the applied for
area at the Lahtojoki diamond deposit are now at an advanced stage.
-- Mining concession at Lahtojoki is expected to be approved, now the last
of the compensation appeals are being finalised. This follows prior
approvals by TUKES, the Finnish mining authority.
-- Exploration programme in the Kuhmo region of Finland continues to be
highly encouraging with results from basal till sampling suggesting that
two of the sample locations may be close to the source of the green
diamond the Company discovered.
-- Work continues in Northern Ireland on the nickel, copper and platinum
mineralisation anomalies.
-- Post Period: 3 year extension granted for Exploration Permit covering
the Riihivaara Kimberlite discovery and adjacent areas.
Professor
“We are very pleased with the Company’s progress regarding the planned development of the mine at the Lahtojoki diamond deposit, the work to find the source of the green diamond and, post period, the extension of the exploration permits which will allow the Company to continue its work on the emerging kimberlite field at Kuhmo. Overall, it has been a very satisfactory period for the exploration team.”
Further Information:Karelian Diamond Resources plc +353-1-479-6180 ProfessorRichard Conroy , ChairmanAllenby Capital Limited (Nomad) +44-20-3328-5656Nick Athanas /Nick Harriss Peterhouse Capital Limited (Broker) +44-20-7469-0930Lucy Williams /Duncan Vasey Lothbury Financial Services +44-20-3290-0707Michael Padley Hall Communications +353-1-660-9377Don Hall http://www.kareliandiamondresources.com
Chairman’s Statement
Dear Shareholder,
I have great pleasure in presenting the Company’s Half-Yearly Report and condensed Financial Statements for the half year ended
The period was one of continued progress in relation to the development of the Lahtojoki diamond deposit in the Kuopio-Kaavi region of
Land possession for the duration of the mine is a major step forward in the Company’s proposed development of the Lahtojoki deposit. The diamond mining project covers 71 hectares (c.176 acres) with the actual kimberlite pipe having a surface area of 16 hectares (c.40 acres). The deposit, as well as containing high quality colourless gem diamonds, contains pink diamonds which are highly sought after and can command prices up to 20 times that of normal colourless gem diamonds.
I believe the development of a diamond mine at Lahtojoki will not only bring significant benefits to the Company, but also to the entire surrounding Kuopio-Kaavi area and, when in production, is expected to be the first diamond mine in
The Company’s exploration programme in the Kuhmo region of
The Company’s nickel, copper and platinum mineralisation exploration project in
Exercise of Warrants
During the period the Company received warrant exercise notices to subscribe for a total of 600,000 new ordinary shares of nominal value €0.00025 each at an exercise price of
Finance
During the period there was a fundraising of £250,000 (including £100,000 from Board members) at
Following admission of these new ordinary shares, in relation to the fundraising and exercised warrants, the Company had a total of 105,092,749 ordinary shares in issue.
The loss after taxation for the half year ended
Directors and Staff
I would like to thank my fellow directors, staff and consultants for their support and dedication, which has enabled the continued success of the Company.
Future Outlook
I look forward to the Company continuing to progress the planned development of the Lahtojoki diamond deposit and also to further success with its diamond exploration in
Yours faithfully,
Professor
Chairman
Condensed income statement
Six-month Six-month period
ended 30 November Year ended 31 May
Note period ended 30 2022 2023
November 2023
(Unaudited) € (Audited) €
(Unaudited) €
Continuing
operations
Operating expenses (255,240) (165,140) (297,386)
Movement in fair 6 122,128 - 9,565
value of warrants
Operating loss (133,112) (165,140) (287,821)
Interest expense (3,239) (3,646) (3,646)
Loss before (136,351) (168,786) (291,467)
taxation
Income tax expense - - -
Loss for the
financial (136,351) (168,786) (291,467)
period/year
Loss per share
Basic and diluted
earnings/(loss) 2 (0.0014) (0.0025) (0.0038)
per share
Condensed statement of comprehensive income
Six-month period Six-month period Year ended 31 May
ended 30 November ended 30 November 2023
2023 2022
(Audited) €
(Unaudited) € (Unaudited) €
Loss for the (136,351) (168,786) (291,467)
financial period/year
Income/(expense)
recognised in other - - -
comprehensive income
Total comprehensive
income/(expense) for (136,351) (168,786) (291,467)
the financial
period/year
Condensed statement of financial position
Note 30 November 2023 30 November 2022 Year ended 31 May
(Unaudited) (Unaudited) 2023 (Audited)
€ € €
Assets
Non-current assets
Intangible assets 3 11,439,845 10,989,210 11,265,894
Financial assets - - -
Total non-current 11,439,845 10,989,210 11,265,894
assets
Current assets
Cash and cash 215,025 90,177 116,038
equivalents
Other receivables 57,834 36,034 79,003
Total current assets 272,859 126,211 195,041
Total assets 11,712,704 11,115,421 11,460,935
Equity
Capital and reserves
Called up share
capital presented as 3,203,532 3,191,807 3,200,882
equity
Share premium 10,726,620 9,959,181 10,546,844
Share based payments 450,658 450,658 450,658
reserve
Retained losses (4,548,661) (4,289,629) (4,412,310)
Total equity 9,832,149 9,312,017 9,786,074
Liabilities
Non-current
liabilities
Convertible loan 122,483 - 119,246
Warrant liabilities 5 95,606 - 109,224
Derivative liability 10,304 146 10,304
Total non-current 228,393 146 238,774
liabilities
Current liabilities
Trade and other
payables: amounts 1,652,162 1,632,822 1,436,087
falling due within
one year
Convertible Loan 6 - 170,436 -
Total current 1,652,162 1,803,258 1,436,087
liabilities
Total liabilities 1,880,555 1,803,404 1,664,859
Total equity and 11,712,704 11,115,421 11,460,935
liabilities
Condensed statement of cash flows
Six-month period Six-month period Year ended 31 May
ended 30 November ended 30 November 2023 (Audited)
2023 (Unaudited) € 2022 (Unaudited) €
€
Cash flows from
operating activities
(Loss) for the (136,351) (168,786) (291,467)
financial period/year
Adjustments for:
Interest expenses 3,239 3,646 3,646
Movement in fair (122,128) - 109,224
value of warrants
(Decrease)/increase
in trade and other 200,825 191,584 1,361
payables
Decrease/(increase) 21,168 24,144 (18,825)
in other receivables
Advances from/
(repayments to)
Conroy Gold and 15,250 - 119,246
Natural Resources
P.L.C
Net cash provided by/
(used in) operating (17,997) 50,588 (76,815)
activities
Cash flows from
investing activities
Investment in
exploration and (173,951) (78,279) (354,963)
evaluation
Net cash used in (173.951) (78,279) (354,963)
investing activities
Cash flows from
financing activities
Issue of share 299,555 - 453,109
capital
Share issue costs (8,620) - (23,161)
Net cash provided by 290,935 - 429,948
financing activities
Increase in cash and 98,987 (27,291) (J,830)
cash equivalents
Cash and cash
equivalents at 116,038 117,868 117,868
beginning of
financial period/year
Cash and cash
equivalents at end of 215,025 90,177 116,038
financial period/year
Condensed statement of changes in equity
Share capital Share-based Retained
(including Share premium payment Total equity
deferred share reserve losses
capital)
€ € € € €
Balance at 1 3,200,882 10,546,844 450,658 (4,412,310) 9,786,074
June 2023
Issue of share 2,650 296,905 - - 299,555
capital
Share issue - (8,620) - - (8,620)
costs *
Warrant issue - (108,509) - - (108,509)
*
Loss for the
financial - - - (136,351) (136,351)
period
Balance at 30 3,203,532 10,726,620 450,658 (4,548,661) 9,832,109
November 2023
Balance at 1 3,191,807 9,959,181 450,658 (4,120,843) 9,480,803
June 2022
Issue of share - - - - -
capital
Share issue - - - - -
costs
Share based - - - - -
payments
Loss for the
financial - - - (168,786) (168,786)
period
Balance at 30 3,191,807 9,959,181 450,658 (4,289,629) 9,312,017
November 2022
Share capital
The share capital comprises the nominal value share capital issued for cash and non-cash consideration. The share capital also comprises deferred share capital. The deferred share capital
*
arose through the restructuring of share capital which was approved at an Annual General Meeting held on
Authorised share capital:
The authorised share capital at
* Capital reorganisation:
Following approval at an Annual General Meeting (“AGM”) held on
Consolidated shares:
On
Share and Warrant issues during the period:
During the period ended
Share premium
The share premium comprises the excess consideration received in respect of share capital over the nominal value of the shares issued as adjusted for the costs of share issue in line with the Company’s accounting policies.
Share based payment reserve
The share based payment reserve comprises of the fair value of all share options and warrants which have been charged over the vesting period, net of amounts relating to share options and warrants forfeited, exercised or lapsed during the period, which are reclassified to retained earnings.
Retained losses
This reserve represents the accumulated losses incurred by the Company up to the condensed statement of financial position date.
The accompanying notes form an integral part of these condensed financial statements.
1 Accounting policies
Reporting entity
Basis of preparation and statement of compliance
The condensed financial statements for the six months ended
The condensed financial statements have been prepared in accordance with International Accounting Standard (“IAS”) 34: Interim Financial Reporting .
The condensed financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company’s annual financial statements as at
The condensed financial statements have been prepared under the historical cost convention, except for derivative financial instruments which are measured at fair value at each reporting date.
The condensed financial statements are presented in Euro (“€”). € is the functional currency of the Company.
The preparation of condensed financial statements requires the Board of Directors and management to use judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. Actual results may differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the financial period in which the estimate is revised and in any future financial periods affected. Details of critical judgements are disclosed in the accounting policies detailed in the annual financial statements.
The financial information presented herein does not amount to statutory financial statements that are required by Chapter 4 part 6 of the Companies Act 2014 to be annexed to the annual return of the Company. The statutory financial statements for the financial year ended
These condensed financial statements were authorised for issue by the Board of Directors on
Going concern
The Company recorded a loss of €136,351 for the six-month period ended
The Board of Directors have considered carefully the financial position of the Company and in that context, have prepared and reviewed cash flow forecasts for the period to
Statement of compliance
The Company’s financial statements have been prepared in accordance with IFRS as adopted by the
Recent accounting pronouncements
The following new standards and amendments to standards have been issued by the
-- Amendments to IFRS 10 and IAS 28: Sale or contribution of assets between
an investor and its associate or joint venture – Postponed indefinitely;
-- Amendments to IFRS 16 Leases: Lease liability in a sale and leaseback –
Effective date 1 January 2024 ; and
-- Amendments to IAS 1 Presentation of Financial Statements: Classification
of liabilities as current or non-current and classification of
liabilities as current or non-current – Effective date 1 January 2024 .
2 Profit/(loss) per share
Basic earnings per
share
Six-month period Six-month period Year ended 31 May
ended 30 November ended 30 November 2023
2023 (Unaudited) € 2022 (Unaudited) €
(Audited)€
Profit/(loss) for
the financial
period/year (136,351) (168,786) (291,467)
attributable to
equity holders of
the Company
Number of ordinary
shares for the 95,096,311 68,542,749 76,460,146
purposes of earnings
per share
Basic earnings/
(loss) per ordinary (€0.0014) (€0.0025) (€0.0038)
share
Diluted earnings/(loss) per share
The effect of share options and warrants is anti-dilutive.
3 Intangible assets
Exploration and
evaluation assets
30 November 2023 30 November 2022 31 May 2023
Cost (Unaudited) € (Unaudited) €
(Audited) €
At 1 June 11,265,894 10,910,931 10,910,931
Expenditure during the
financial period/year
-- License and 93,258 18,510 269,314
appraisal costs
-- Other operating 80,693 59,769 85,649
expenses
At 30 November/31 May 11,439,845 10,989,210 11,265,894
Exploration and evaluation assets relate to expenditure incurred in the development of mineral exploration opportunities. These assets are carried at historical cost and have been assessed for impairment in particular with regard to the requirements of IFRS 6: Exploration for and Evaluation of Mineral Resources relating to remaining licence or claim terms, likelihood of renewal, likelihood of further expenditure, possible discontinuation of activities as a result of specific claims and available data which may suggest that the recoverable value of an exploration and evaluation asset is less than its carrying amount.
The Board of Directors have considered the proposed work programmes for the underlying mineral resources. They are satisfied that there are no indications of impairment.
The Board of Directors note that the realisation of the intangible assets is dependent on further successful development and ultimate production of the mineral resources and the availability of sufficient finance to bring the resources to economic maturity and profitability.
4 Commitments and Contingencies
At
5 Convertible Loan
On
The amount of €10,304 relates to derivative liability attached to the total convertible loan note at date of issue above and the net amount of €119,246 was recorded as the value of the convertible loan at
6 Warrant liabilities
The Company holds Sterling based warrants. The Company estimates the fair value of the sterling-based warrants using the Binomial Lattice Model. The determination of the fair value of the warrants is affected by the Company’s share price along with other assumptions.
The fair value of the warrants in issue as at
7 Related party transactions
(a)Apart from Directors’ remuneration, equity investment from Directors, and loans from shareholders, (who are also Directors), there have been no contracts or arrangements entered into during the six-month period in which a Director of the Company had a material interest.
(b)
The Company shares accommodation and staff with Conroy Gold and Natural Resources plc which have certain common Directors and shareholders. For the six-month period ended
(c)
In
8 Subsequent events
There were no material events subsequent to the reporting date which necessitate revision of the figures or disclosures included in the financial statements.
9 Approval of the condensed financial statements
These condensed financial statements were approved by the Board of Directors on
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