31 December 2016
31 December 2015
30 June 2016
Investment in an associate
Accretion of investment
Share of loss in associate
b) Investment in TRAC Technologies
On 1 November 2016 the Company announced the acquisition of 27.3% of TRAC Technology Limited ("TRAC") for $100,000 satisfied through $50,000 in cash and the issue of 2,600,000 new ordinary shares at 1.6p per share.
At the date of these financial statements it was concluded that the purchase price of the investment in TRAC reflected the value of the investment as at 31 December 2016 and that there had been no significant movements between the date of acquiring the investment and the interim financial statement date. It was also concluded that no impairment to the value of the investment was required.
4. Loan advancement for Finland Investment
On 13 October 2016 the Company entered into a Memorandum of Understanding ("MOU") with Mineral Exploration Network (Finland) Limited ("MENF") with a view to establishing a potential joint venture in the future in order to develop gold exploration and mining assets in Finland.
Under the MOU, the Company paid €150,000 upfront on 18 October 2016. The Company has agreed to issue the equivalent of €150,000 new ordinary shares at an implied price of 1.6p in return for 150 shares in Kalevala Gold Oy ("Kalevala"), a Finnish company established to develop the various licences subject to the joint venture with MENF. The Company has committed to invest a further €350,000 in Q1 2017 with an option to provide a further €1m to take its interest up to 50% in the JV.
Although the Company advanced the initial cash payment in October, the share-based payment element of the acquisition did not occur until after the period end. Furthermore, Kalevala, the entity in which shares are being acquired, was not incorporated until January 2017 and as such, the Company did not have a shareholding in this investment at the date of these interim financial statements. For this reason, it has been deemed appropriate to treat the initial cash payment as a loan advancement for the future acquisition of the investment.
5. Share Capital
31 December 2016
31 December 2015
30 June 2016
No of Shares
No of Shares
No of Shares
Issued during the period/ year
All shares issued by the Company are "ordinary" shares and rank equally in all respects, including for dividends, shareholder attendance and voter rights at meetings, on a return of capital and in a winding-up.
A resolution was passed at an Extraordinary General Meeting ("EGM") for the issue of 81,818,182 new ordinary shares (the "Placing Shares") at a price of 1.1p per share (the "Placing Price") on 28 July 2016. The Placing on 28 July 2016 raised £900,000 before fees and expenses. In addition the Company issued 81,818,182 warrants exercisable at 2.2p.
The EGM resolutions also included the redesignation of the ordinary shares of 7p in the capital of the Company as ordinary shares of no par value.
On the same date, the Company also issued 5,000,000 new ordinary shares to Cameron Parry as part of his remuneration package.
On 1 November 2016 the Company announced the acquisition of 27.3% of TRAC Technology Limited ("TRAC") for $100,000 satisfied through $50,000 in cash and the issue of 2,600,000 new ordinary shares at a price of 1.6p per share.
6. Share-based payments
The Company has the ability to issue options to Directors to compensate them for services rendered and incentivise them to add value to the Group"s longer term share value.
As at 31 December 2016, there were no options in existence over the shares of Lionsgold Limited.
250,000 options previously granted to Stephen Oke (125,000 on 31 December 2012 and 125,000 on 25 November 2013) lapsed during the period due to his resignation from the Board on 31 December 2016 under the terms of the Company"s option plan.
300,000 options previously granted to Harvinder Hungin (150,000 on 31 December 2012 and 150,000 on 25 November 2013) lapsed due to his resignation from the Board on 30 September 2016.
In addition to the Placing on 28 July 2016 which raised £900,000 before fees and expenses, the Company issued 81,818,182 warrants exercisable at 2.2p. No warrants have been exercised throughout the six month period to 31 December 2016 and no warrants have expired in this period.
During the period an amount of £61,530, representing the fair value of the warrants, has been recognised against share premium. The fair value of the options was determined using the Black Scholes model.
c) Share-based payments
On his appointment to the board, Cameron Parry was issued with 5,000,000 new ordinary shares. The issue of these shares occurred simultaneously with the Placing of 81,818,182 shares which raised £900,000 before fees and expenses.
The Placing shares were issued at a price of 1.1p which has also been taken as the deemed fair value of the shares issued to Cameron Parry.
These shares constitute a sign-on fee paid in shares and hence a share-based payment of £55,000 which has been recognised in profit and loss.
7. Operating Segments
For the financial period under review the Group had one reportable segment, being Indian Exploration - Investment in gold exploration activities and administration in the Kolar Gold Fields region in Karnataka State, India.
The Group also has corporate administrative functions outside India which generate corporate expenses that have not been allocated to a segment. Due to the winding down of the Australian subsidiary, much of these costs have since been reduced materially.
The Group"s Chief Executive Officer reviews internal management reports for this segment on a monthly basis.
The Group has no revenue at this stage of its development and performance is measured based on expenses incurred and exploration activity levels in the Indian segment.
8. Subsequent events
Lionsgold Limited was formerly known as Kolar Gold Limited and changed its name effective 23 February 2017.
Following the period ended 31 December 2016 the following Options were granted:
M Hanuma Prasad
Each Option entitles the holder to subscribe for one ordinary share in Lionsgold Limited. Options do not confer any voting rights on the holder.
Lionsgold Limited issued 8,500,000 new ordinary shares to Mineral Exploration Network (Finland) Limited ("MENF") in January 2017 in return for 150 shares in Kalevala Gold Oy ("Kalevala"), the recently incorporated Finnish company established to develop the various licences subject to the joint venture with MENF (the "JV") announced on 13 October 2016.
The New Shares were issued at an implied price of 1.6p per share by reference to the consideration of €150,000 as detailed in these financial statements.
There have been no other significant events subsequent to the balance sheet date to report that would alter the condensed consolidated interim financial statements as at 31 December 2016 or require disclosure.