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European Green Transition plc announced the audited results for its wholly-owned subsidiary, European Green Metals Limited (EGM), for the year ended 31 December 2023. During 2023, EGM completed the acquisition of the Olserum Rare Earth Element project in Sweden in July and was granted a permit for the Marienberg critical metals project in Germany in June. Post-period, European Green Transition plc was admitted to AIM in April 2024, concurrently raising £6.5 million.
| Date | 25 Jun 2024 |
| Time | 07:00:06 |
| Category | Results |
| ID | 6749T |
25 June 2024
European Green Transition plc
("European Green Transition", "EGT", "the Company" or "the Group")
Results for Year Ended 31 December 2023
European Green Transition (AIM: EGT), a company developing green economy assets in Europe which aims to capitalise on the opportunity created by the green energy transition, is pleased to announce the audited results for European Green Metals Limited ("EGM"), the Group's wholly owned subsidiary, for the year ended 31 December 2023.
The Company was incorporated on 25 January 2024 as European Green Metals Holdings Limited, later renamed European Green Transition Limited on 29 February 2024 and subsequently re-registered as a public company changing its name to European Green Transition plc on 25 March 2024, ahead of its admission to AIM. European Green Transition plc is the holding company of the Group.
2023 Highlights
· Exercised option and completed acquisition of the Olserum Rare Earth Element ("REE") project in Sweden in July 2023.
Post Period End Highlights
· Incorporation and subsequent rebranding to European Green Transition plc, reflecting the Group's broader strategic focus and future as a public company.
· Successful admission of European Green Transition plc to AIM and concurrent £6.5m fundraise in April 2024.
· Entered an exclusive 12-month option to commence due diligence on and potentially acquire the Limni copper.
· Entered an exclusive 12-month option to investigate the potential to develop a peatland carbon sink programme and in turn generate carbon credits in Donegal, Ireland.
· Positive results from channel and grab samples taken at the Djupedal prospect, the nearby Bersummen area, and the newly identified Stora Lockerum structure, all located within the Olserum REE project in Sweden. These results support the Directors' belief that our fully permitted low-cost drill programme, scheduled for H2-2024, could confirm a district scale system with further project upside, supporting our aim of attracting a partner to fund a larger scale programme.
Aiden Lavelle, Chief Executive Officer of European Green Transition, said:
"Today we are presenting 2023 annual results for the Group's wholly owned subsidiary. 2023 was a pivotal year for the Group. We successfully completed the acquisition of the Olserum REE project in Sweden and laid the foundations for admission to AIM and concurrent fundraise of £6.5m in April 2024.
"Following our successful IPO, we aim to deliver value for shareholders and support Europe's green energy transition through our green economy portfolio. In H2-2024 we plan to conduct a low-cost drill programme at the Olserum REE project. We anticipate this will support our approach to engage a third party to fund its future development and potential commercialisation.
"Since IPO, EGT has secured two exclusive option agreements to expand our portfolio of green economy assets. The Limni copper tailings recycling project in Cyprus offers potential to recover meaningful amounts of copper in a capital efficient manner and subsequent solar energy development, and the Altan peatland carbon credit project in Ireland offers potential entry into the voluntary carbon credits market. We are now continuing our diligence work to ascertain the commercial viability of these projects, with the intention to pursue near-term revenue generation. We remain very active in our pursuit of further opportunities; as Europe progresses in its green transition, we see numerous undervalued assets and are excited about the potential to capitalise on these with a view to generate shareholder value."
A copy of this announcement, together with the Annual Report and Accounts will be available to view on the Company's website in due course at www.europeangreentransition.com
Enquiries
European Green Transition plc
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Aiden Lavelle, CEO |
+44 (0) 208 058 6129 |
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Jack Kelly, CFO |
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Panmure Gordon - Nominated Adviser and Broker
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James Sinclair-Ford / Dougie McLeod / Ivo Macdonald Mark Murphy / Hugh Rich / Rauf Munir |
+ 44 (0) 20 7886 2500 |
Camarco - Financial PR
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Billy Clegg, Elfie Kent, Lily Pettifar, Poppy Hawkins |
[email protected] + 44 (0) 20 3757 4980
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Notes to Editors
European Green Transition plc (listed on the AIM London Stock Exchange under the ticker "EGT") is a business operating in the green economy transition space in Europe. EGT intends to capitalise on the opportunities created by Europe's transition away from fossil fuels to a green, renewables-focused economy. The Company plans to expand its existing portfolio of green economy assets through M&A, targeting what it believes to be distressed and undervalued projects. EGT sees substantial opportunities to deliver value from its M&A pipeline, which includes critical material, wind, solar, processing and recycling projects.
EGT's highly experienced leadership team have a strong track record of building successful public companies through the acquisition of distressed assets. EGT plans to replicate this approach, creating a sustainable and profitable business while generating shareholder returns.
The Company's current portfolio of green economy assets includes the Olserum Rare Earth Project in Sweden. The Olserum project is one of Sweden's projects of "National Interest" and has the potential to become Europe's first operating REE mine. EGT has taken an exclusive option over a copper tailings recycling project in Cyprus with the potential to generate meaningful amounts of copper, and with the site and surroundings offering an excellent long-term location to establish a potential solar power facility. EGT has taken a further exclusive option to develop a peatland carbon sink programme and in turn generate carbon credits at Altan in Donegal in the northwest of Ireland. EGT owns additional projects in northern Sweden and Germany which have defined and tangible upside with potential to realise near-term inflection points in a cost-effective manner. EGT's objective is to build a profitable business while aiming to monetise some of its assets through sale or partnership with larger industry players or European end users. The team is focused on success while remaining committed to its defined ESG strategy, ensuring excellent development practices across all projects in addition to regular local community engagement.
Chairman's Statement
For the year ended 31 December 2023
Introduction
I am pleased to present my first Annual Report statement as the Non-Executive Chairman of European Green Transition plc (EGT) following the Company's successful admission to AIM in April 2024 and concurrent £6.5m fundraise. The financial statements presented in this report relate to European Green Metals Limited (EGM), a 100% owned subsidiary of EGT. EGT was incorporated on 25 January 2024 as European Green Metals Holdings Limited, later renamed European Green Transition Limited on 29 February 2024 and subsequently re-registered as public company changing its name to European Green Transition plc on 25 March 2024, ahead of its admission to AIM.
EGT's goal is to capitalise on the significant opportunity created by the green energy transition by targeting green economy assets in Europe, for Europe. Led by a highly qualified and experienced management team with a strong track record of successfully founding and scaling companies in the public markets, I have every confidence that we will deliver on our mission.
Business Model
As we look to execute our strategy of acquiring and developing a portfolio of green economy assets in Europe, we have identified a pipeline of attractive, revenue or near revenue stage projects, many of which we believe could potentially be acquired for a fraction of the capital that has been invested in them to date. These are typically projects where the current owners are now unable to raise sufficient capital to progress them further.
Our objective is to obtain control of these assets by structuring deals with a small upfront payment, with future payments tied to project milestone achievements. Once acquired, we intend to seek to de-risk the projects through cost-effective, capital-light activities with the goal of developing a profitable, sustainable business, with the optionality to monetise these projects through a sale or by bringing in a larger partner with the required expertise and skills to develop the project further.
Leadership
We have developed an experienced leadership team that has extensive small cap public company experience and a track record of successfully building and scaling public companies. The EGT team has a strong track record in leading M&A-focused businesses, focusing on identifying distressed or undervalued assets, completing further acquisitions, generating operational improvements, and ultimately scaling companies in the public market.
Our team is led by Aiden Lavelle (CEO and Chartered Geologist with 16 years' industry experience) and Jack Kelly (CFO and Chartered Accountant with extensive experience in M&A). Cathal Friel is co-founder, largest shareholder and Non-Executive Director. Our Board is completed by James Leahy, Non-Executive-Director who has c.34 years' experience in stockbroking and commodities in a variety of roles, including as a research analyst, equity salesperson and specialist corporate broker.
The Green Economy Opportunity
In 2023, the European Commission proposed a comprehensive set of actions to ensure the EU's access to a secure, diversified, affordable, and sustainable supply of critical raw materials. At the same time as demand for critical raw materials is projected to increase drastically, European industry relies heavily on imports, often from quasi-monopolistic third country suppliers such as China.
To mitigate this risk, the European Commission launched the Critical Raw Materials Act (CRMA). The CRMA aims to reduce dependence on non-European imports, specifically from China, which in December 2023 imposed further restrictions on the export of REE extraction and separation technologies. It is the Board's belief that EGT is well placed to benefit from the CRMA in Europe.
Focus on ESG & Sustainability
Maintaining high ESG standards is at the forefront of all of EGT's activities and the Company intends to maintain its environmental and social practices across all projects, engaging with local communities and stakeholders throughout.
In Sweden, we hosted two community meetings in August 2023 and April 2024, both of which I attended, whereby we outlined our plans and activities at the Olserum REE project. We have also engaged with local politicians, landowners, business representatives and other key stakeholders to keep them updated on our plans for the project. Regular engagement with local stakeholders is critical to project success and we will continue to work closely with those located nearby to all our projects.
Outlook - Positioning EGT for the future
2023 was a busy year for EGT. We completed our acquisition of the Olserum REE project and undertook the preparatory work to facilitate our admission to trading on the AIM market of the London Stock Exchange in April 2024.
Following our IPO, we are very excited by the future opportunities for EGT to deliver value to shareholders through what the Board believe to be a number of high potential projects.
The Olserum REE project in Sweden has the potential to be Europe's first REE mine, and we look forward to commencing our low-cost drill programme in H2-2024 which could support the Company's aim of engaging in monetisation discussions with potential partners and acquirors to fund its future development and potential commercialisation.
We have expanded our portfolio of green economy assets with the addition, through exclusive option agreements, for the Cyprus copper tailings recycling project, which has the potential to recover meaningful amounts of copper in a capital efficient manner and subsequent solar energy potential, and for the Altan carbon credit project in Ireland. Management continues to conduct encouraging discussions around monetising our other assets, namely the Pajala copper-graphite project in Sweden and the critical mineral projects in Saxony.
I strongly believe in the Company's potential, and in the management team's ability to deliver on this and rapidly grow EGT in the coming years. We have a clear strategic vision and a relentless focus on execution, supported by a robust cash balance. With that in mind, we believe that we are well positioned to capitalise on the opportunities that lie ahead as we aim to deliver long-term value for our shareholders.
Daniel Akselson
Chairman
25 JUNE 2024
CEO Statement
For the year ended 31 December 2023
Introduction
European Green Transition plc is a business operating in the green economy transition space in Europe. EGT was admitted to trading on the AIM market of the London Stock Exchange in April 2024 under the ticker "EGT". The foundations of our successful IPO in 2024 were established in 2023, and I believe that EGT is now well positioned to build on this over the coming 12-24 months, as we seek to capitalise on the opportunities created by Europe's transition away from fossil fuels to a green, renewable energy-focussed economy.
EGT intends to expand its existing portfolio of green economy assets through a disciplined M&A-focused approach, targeting what it believes to be distressed and/or undervalued projects with near revenue stage potential. Our focus has shifted towards later stage opportunities as this is where we see more potential to generate near-term returns. We continue to review opportunities with the potential to deliver value from our M&A pipeline, which includes tailings, wind, solar, carbon credit and recycling projects. We remain committed to our disciplined, capital light approach and we will seek to progress our projects through key inflection points in a cost-efficient manner.
Maintaining high ESG standards is at the forefront of all of EGT's activities and the team is focused on success while remaining committed to its ESG approach, ensuring excellent development practices across all projects in addition to regular local community engagement.
EGT's current European Green Economy Assets
The Company's current portfolio of green economy assets includes the Olserum Rare Earth Elements (REE) Project in Sweden. Olserum was designated a project of "National Interest" by the Swedish Geological Survey in 2023 and we believe it is one of only a few significant REE resources in Europe. In addition, EGT holds the Pajala copper-graphite project in northern Sweden and an early-stage critical minerals project in Saxony, Germany.
In recent months we have looked to bolster our portfolio with further exciting assets through two exclusive option agreements, including the Limni copper tailings recycling project in Cyprus and the Altan carbon credit project in Donegal, Ireland. These opportunities align with our strategy to target green economy assets in Europe with revenue potential, as we look to build a profitable business while aiming to monetise assets through sale or partnership with larger industry players.
Olserum REE Project
The Olserum REE project is a 100% owned REE project located near excellent infrastructure in southern Sweden. It has a defined 43-101 compliant resource estimate from 2013 consisting of an Indicated Resource of 4.5Mt grading 0.6% TREO and Inferred Resource of 3.3Mt grading 0.63% TREO using a 0.4% cut-off, with 36 historic diamond drill holes across the project totalling 6,191m. The resource has a good contribution of high value critical REEs used in permanent magnets that are critical to the green transition namely dysprosium, neodymium and praseodymium.
Post-period, positive field mapping and grab sampling results from H1-2024 have led the Directors to believe that there is potential to scale the resource, particularly at the adjacent Olserum west prospect and at the Djupedal prospect where channel samples taken confirm REE mineralisation including 3m @ 1.58% TREO and 1m @ 2.27% TREO with c. 30% HREO average, and several new grab samples grading from >1.0% up to 15.27% TREO. A new mineralised shear zone structure at Stora Lockerum, 900m south of Djuepdal, was located and shows the potential to expand the scale of the project.
These results, combined with our new structural model for the area, increase our confidence in intersecting mineralisation in our upcoming H2-2024 drill programme which we expect to confirm that a district scale REE system is present. To date, we have defined a 1km mineralised trend at Djupedal, and the footprint of this mineralised area exceeds that of Olserum and Olserum West combined. The aim of the initial low-cost, fully permitted drill program is to show the potential for increased grade and size of the REE system at Olserum, which may support third-party interest in the project.
Exclusive Option over Cyprus Copper Tailings Recycling Project
In late April 2024, the Company announced an option to acquire the prospecting licence over the past-producing Limni copper mine near Polis in western Cyprus. The Limni project is a copper tailings recycling project with potential to generate meaningful volumes of copper, with the site and surroundings also offering an excellent long-term location to establish a potential solar power facility with power grid infrastructure adjacent to the site.
The Limni mine produced over 8.1 Mt at 1.11% Cu between 1937 and 1978 from a large open pit operation. The tailings from the deposit and other adjacent smaller higher-grade deposits were left at a tailings facility by the coast for c.30 years prior to being backfilled into the Limni pit by an EU funded program in 2010. The tailings, which are largely believed to be oxidised, are a source of copper and other metals which can be seen leaching from the pit as blue metal-enriched water. The Company is now working with consultants to determine if there is a low-cost treatment method to extract the copper, with potential to thereby generate a modest revenue while also improving the long-term environment around the site.
Cyprus is a stable EU jurisdiction which receives the most solar irradiance of any EU country, and yet it is heavily dependent on fossil fuels for its baseload energy requirements. The Company sees a strong opportunity to support Cyprus' transition away from imported fossil fuels towards a sustainable source of renewable energy through the potential development of a solar energy plant with adjacent power grid infrastructure, including a substation, near the site.
Exclusive Option over Altan Peatland Carbon Credit Project
In May 2024, EGT announced that it had taken an exclusive option agreement on the Altan carbon credit project in Ireland, to investigate the potential to develop a carbon sink project through peatland restoration and sale of certified carbon credits. Altan is a c.1,370 acre site primarily comprising of blanket peatland located in county Donegal in the northwest of Ireland.
EGT intends to generate carbon credits at Altan through a revenue sharing model between EGT and the Landowner. Through this approach the Company is looking to replicate a number of successfully implemented projects in Scotland, which leads the way in Europe in peatland re-wetting. A carbon credit is generated by either removing from the atmosphere, or avoiding the emission, of one tonne of carbon dioxide equivalent. Carbon credit markets exist as mandatory (compliance) schemes or voluntary programs, with the voluntary market projected to grow by a factor of 15 or more by 2030 to $50bn as companies strive to meet carbon neutral targets goals. Within this context, EGT sees potential to generate carbon credits from Altan and scale the Carbon Credit Project across other peatland opportunities.
Outlook
Building on the momentum of our successful listing on AIM, we continue to make important strides across our portfolio of green economy assets while maintaining a robust cash position through our disciplined approach to capital allocation. We believe our focus on near revenue stage projects is a key differentiator and we continue to explore further opportunities that meet these criteria.
Looking to the remainder of 2024 and beyond we believe that EGT is well-positioned for further growth. We are excited to commence our low-cost drilling programme at the Olserum REE project which should increase our confidence that a district scale REE system is present. We expect this will support our efforts to monetise the project through looking to partner with a larger industry player or long-term investor who can fund the project's future development and potential commercialisation. Likewise, we will continue our due diligence activities over our options on the Cyprus Copper Tailings Recycling project and the Altan Peatland Carbon Credit project as we look to ascertain the commercial potential of both projects. We remain committed to generating a return from our Pajala copper graphite project and the Saxony projects and believe that we will be able to advance these in 2024. Europe's green transition continues to generate significant opportunities, many of which appear undervalued, and we believe we can identify and capitalise on some of these to generate shareholder value.
Aiden Lavelle
CEO
25 JUNE 2024
European Green Metals Limited ("EGM" or the "Company") is a private company, limited by shares, incorporated in England and Wales with company number 13399065. Details of the registered office, the officers and advisers to the Company are presented on the Company Information page at the end of this report.
The principal activity of the Group is developing green economy assets in Europe which aims to capitalise on the opportunity created by the green energy transition.
The consolidated Financial Statements comprise those of the Company and its subsidiaries (together the "Group"). The consolidated Financial Statements of the Group and the individual Financial Statements of the Company have been prepared in accordance with UK-adopted international accounting standards ("UK-adopted IAS") as they apply to the Group for the period ended 31 December 2023 with the requirements of the Companies Act 2006. The financial statements are prepared on the historical cost basis.
Principal accounting policies
The principal accounting policies are summarised below. They have been consistently applied throughout the year covered by the Financial Statements.
Consolidation
The consolidated Financial Statements comprise the Financial Statements of the Company and its subsidiaries as at and for the year to 31 December 2023. Subsidiaries are entities controlled by the Group. Where the Group has control over an investee, it is classified as a subsidiary. The Group controls an investee if all three of the following elements are present: power over an investee, exposure to variable returns from the investee, and the ability of the investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control. Subsidiaries are fully consolidated from the date that control commences until the date that control ceases. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. Intergroup balances and any unrealised gains or losses or income or expenses arising from intergroup transactions are eliminated in preparing the consolidated Financial Statements.
Comparative period
The comparative period is for the year to 31 December 2022.
Going concern
Management believe that it is appropriate to prepare these consolidated financial statements on the going concern basis. In making that assessment, management are required to consider whether the Group can continue in operational existence for the foreseeable future, being a period of not less than twelve months from the date of the approval of the consolidated financial statements. In reaching the going concern conclusion, the cash and cash equivalents of £88,000 as at 31 December 2023 and Group's forecasts and projections over the 24 months from year end, along with sensitivity analysis performed on the projected cashflows taking into account reasonable changes in market conditions, were considered. The Group also took into consideration the fund raise of £6.4m in March 2024 by its new parent, EGT, post year end .The Group, therefore, continues to adopt the going concern basis in preparing the consolidated financial statements. Further information is provided on page 17 of the Group Directors' Report.
Reclassification of comparative information
A presentational change has been made to the Consolidated Statement of Cash Flow, specifically to the Company for the year ended 31 December 2022. The correction addresses the investment in Rockfleet Minerals Ltd of £90,000, which was mistakenly included in the 2022 Company cashflow statement. Since no cash was exchanged, it is a non-cash flow item and had no impact on last year's cash flow.
Presentation of balances
The consolidated Financial Statements are presented in Pounds Sterling ("£") which is the functional and presentational currency of the Company.
The following table discloses the major exchange rates of those currencies utilised by the Group:
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Average rate 2023 |
Average rate 2022 |
Year end rate 2023 |
Year end rate 2022 |
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Rate compared to GBP£ |
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Euro (€) |
1.16 |
1.14 |
1.15 |
1.13 |
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Swedish Kroner (SEK) |
13.05 |
n/a |
12.85 |
n/a |
The accounting policies adopted are consistent throughout the financial period. Standards and amendments to IFRS effective as of 1 January 2023 have been applied by the Group.
Standards issued but not yet effective
There were a number of standards and interpretations which were in issue at 31 December 2023 but were not effective at 31 December 2023 and have not been adopted for these Financial Statements. These include:
• Amendments to IFRS 7 Financial Instruments: Disclosures - amendments regarding supplier finance arrangements (applicable on or after 1 January 2024)
• Amendments to IFRS 16 Leases - requirements on accounting for sale and leaseback after the date of transaction (applicable on or after 1 January 2024)
• Amendments to IAS 1 Presentation of Financial Statements - amendments regarding the classification of debt with covenants (applicable on or after 1 January 2024)
• Amendments to IAS 7 Statement of Cash Flows - amendments regarding supplier finance arrangements (applicable on or after 1 January 2024)
The Directors have assessed the impact of these accounting changes on the Group. To the extent that they may be applicable, the Directors have concluded that none of these pronouncements will cause material adjustments to the Group's Financial Statements.
The preparation of Financial Statements in conformity with IFRS requires management to make estimates and judgements that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the period end and the reported amounts of revenues and expenses during the reporting period. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Group's accounting policy descriptions set out the areas that involve significant estimation, uncertainty and critical judgement. The most significant of which are:
(a) Carrying value of intangible exploration and evaluation assets - Note 14
The capitalisation of exploration costs relating to the exploration and evaluation phase requires management to make judgements as to the future events and circumstances of a project, especially in relation to whether an economically viable extraction operation can be established. In making such judgements, the Directors take comfort from the findings from exploration activities undertaken, the fact the Group intends to continue these activities and that the Company expects to be able to raise additional funding to enable it to continue the exploration activities.
At each reporting date, management make a judgment as to whether circumstances have changed following the initial capitalisation and whether there are indicators of impairment. If there are such indicators, an impairment review will be performed which could result in the relevant capitalised amount being written off to the income statement.
In the current year an impairment charge of £44,115 was made to Intangibles Assets and charged to the Consolidated Income Statement, see note 14.
(b) Investment in subsidiaries and recoverability of intercompany receivables - Note 15 and 17
In addition, the Company has also considered its investment in subsidiaries and loans to subsidiaries. In the current year and at this stage of the Company's development, the Company see no requirement for impairment of its investment in or loans to its subsidiaries.
Employee benefits
All employee benefit costs, notably bonuses and contributions to personal pension plans are charged to the Consolidated Statement of Comprehensive Income on an accruals basis.
Financial instruments
Financial instruments are classified on initial recognition as financial assets, financial liabilities or equity instruments in accordance with the substance of the contractual arrangement. Financial instruments are initially recognised when the Company becomes party to the contractual provisions of the instrument. Financial assets are de-recognised when the contractual rights to the cash flows from the financial asset expire or when the contractual rights to those assets are transferred. Financial liabilities are de-recognised when the obligation specified in the contract is discharged, cancelled or expired.
Cash and cash equivalents
Cash and cash equivalents comprise bank current account balances and short-term deposits with a maturity of three months or less. Amounts are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade and other receivables
Trade and other receivables have fixed or determinable payments that are not quoted in an active market, are measured at initial recognition at fair value, and are subsequently measured at amortised costs using the effective interest method less impairment. Trade and other receivables are reduced by appropriate allowances for estimated irrecoverable amounts. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
Impairment of financial assets
At each statement of financial position date, financial assets are assessed for indicators of impairment. Financial assets are impaired if indications exist that events have occurred after the initial recognition of the financial asset that estimated future cash flows have been impacted. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Any impairment loss arising from the review is charged to the statement of comprehensive income whenever the carrying amount of the asset exceeds its recoverable amount.
IFRS 9 requires the Company to make an assessment of expected credit losses relating to loans to subsidiary companies. An expected credit loss model has been used which takes into account the probability of default, the exposure at default and the loss given default at the year end. The Company defines default as the performance against plans, forecasts and the overall progress towards monetisation.
The Company does not expect loans to be recalled within the next 24 months and nor would amounts be available to repay on demand and therefore the Company has considered this in calculating the expected credit loss. The probability of default is considered to be low when considering the performance of the subsidiary companies. The potential recoverable amount has been estimated based on a probability weighted cashflow model. Cashflow assumptions include forecast future licence payments, the amount and timing of which are uncertain. The Company does not believe that there is a significant risk of default and therefore has not recognised a loss provision in the current year.
Trade and other payables
Trade and other payables are initially measured at their fair value and are subsequently measured at their amortised cost using the effective interest rate method except for short-term payables when the recognition of interest would be immaterial.
Foreign currency translation
The Company translates foreign currency transactions into its functional currency, £, at the rate of exchange prevailing at the transaction date. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the rate of exchange prevailing at the Statement of Financial Position date. Exchange differences arising are taken to the Statement of Comprehensive Income.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to other comprehensive income. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the income statement as part of the gain or loss on sale.
EGM has a functional currency of GBP£, Rockfleet Minerals Limited and European Green Metals (Ireland) Limited have a functional currency of Euro€ and European Mineral Exploration AB and Olree AB have a functional currency of Swedish Krona SEK.
Exploration expenditure relates to the initial search for deposits with economic potential. Evaluation expenditure arises from a detailed assessment of deposits that have been identified as having economic potential. The costs of exploration assets include the cost of acquiring the right to explore. Costs incurred in relation to evaluating the technical feasibility and commercial viability of extracting resources are capitalised as part of exploration and evaluation assets. Exploration costs are capitalised until technical feasibility and commercial viability of extraction of reserves are demonstrable. At that point, all costs which have been capitalised to date and included in exploration and evaluation assets, are assessed for impairment. All impairment losses are recognised immediately in the statement of comprehensive income. If assets are not impaired, then they are reclassified as either tangible assets or intangible assets and amortised over their useful life.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount may exceed its recoverable amount. The Group reviews and tests for impairment on an ongoing basis and specifically if the following occurs:
• the period for which the group has a right to explore in the specific area has expired during the year or will expire in the near future, and is not expected to be renewed;
• substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned;
• exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the Group has decided to discontinue such activities in the specific area; or
• sufficient data exists to indicate that although a development in the specific area is likely to proceed the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.
Investment in subsidiaries
Investments in subsidiaries are stated at cost less impairment. Investment in subsidiaries are subject to annual impairment review, with any impairment charge being recognised in the Statement of Comprehensive Income. The Group determines whether an investment is a business combination by applying the definition in IFRS 3, which requires that the assets acquired and liabilities assumed constitute a business. If the assets acquired are not a business, the Group accounts for the transaction as an asset acquisition. Frequently, the acquisition of mining exploration assets is effected through a non-operating corporate structure. As these structures do not represent a business, it is considered that the transaction does not meet the definition of a business combination. Accordingly, the transaction is accounted for as the acquisition of an asset. The net assets acquired are recognised at cost. When IFRS 3 guidance is applied to the acquisition of Rockfleet Minerals Limited, European Mineral Exploration AB and Olree AB the indicators point to the acquisition being that of assets (primarily mining exploration permits) as opposed to an acquisition of a business. After reviewing the characteristics of the acquisition, the Group has determined that the appropriate accounting treatment of these acquisitions is as asset acquisition.
Impairment
At each Statement of Financial Position date, the Company reviews the carrying amounts of its investments and acquired intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Any impairment loss arising from the review is charged to the Statement of Comprehensive Income whenever the carrying amount of the asset exceeds its recoverable amount.
The Group assesses each asset annually to determine whether any indication of impairment exists. Where an indicator of impairment exists, a formal estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs to sell and value in use. These assessments require the use of estimates and assumptions such as discount rates, future capital requirements, general risks affecting the green energy industry and other risks specific to the individual asset. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. Fair value is generally determined as the present value of estimated future cash flows arising from the continued use of the asset, using assumptions that an independent market participant may take into account. 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. Assets are grouped into the smallest group that generate cash inflows are independent of other assets.
Property, plant and equipment
Property, plant and equipment are stated at historical cost less accumulated depreciation and any provision for impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the asset and bringing the asset to its working condition for its intended use.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only where it is probable that future economic benefits associated with the asset will flow to the Group and the cost of the asset can be measured reliably. The carrying amount of the replaced asset is derecognised. All other repairs and maintenance are charged to the Statement of Comprehensive Income during the financial period in which they are incurred. Any borrowing costs associated with qualifying property, plant and equipment are capitalised and depreciated at the rate applicable to that asset category.
Depreciation on assets is calculated using the straight-line method to allocate their cost to its residual value over their estimated economic useful lives, as follows:
Computer Equipment three years
The assets' residual values and useful economic lives are reviewed regularly, and adjusted if appropriate, at the end of each reporting period.
Gains and losses on the disposal of assets are determined by comparing the proceeds with the carrying amount and are recognised in Administration expenses in the Statement of Comprehensive Income.
Taxes
Tax comprises current and deferred tax. Current tax is the expected tax payable on the taxable income for the period, using tax rates enacted or substantially enacted at the reporting date. Deferred tax assets or liabilities are recognised where the carrying value of an asset or liability in the Statement of Financial Position differs to its tax base and is accounted for using the statement of financial position liability method. Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against which the difference can be utilised. From 1 April 2023 the UK main corporation tax rate is 25%, increasing from 19% where taxable profits exceed £250,000. For companies with taxable profits below £50,000 the small profits rate remains at 19%. There is no deferred tax asset recognised for the Group or Company as the company is still pre-revenue, and thus not considered probable that future trading profits would be generated in which this asset could be offset.
Share capital
Ordinary Shares are classified as equity. Proceeds in excess of the nominal value of shares issued are allocated to the share premium account and are also classified as equity. Incremental costs directly attributable to the issue of new Ordinary Shares or options are deducted from the share premium account.
Revenue recognition
Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable.
Exceptional items
These are items of an unusual or non-recurring nature incurred by the Group and include transactional costs and one-off items relating to business combinations, such as acquisition expenses, restructuring costs etc.
The Board considers there to be only a single operating segment: Green Energy projects. All areas of the business are engaged in the development of a range of Green Energy projects. Performance information is reported as a single business unit to the executive management team, who are responsible for reviewing the Group's management information. The Chief Executive Officer and Chief Financial Officer are considered to be the chief operating decision makers.
The Group did not generate revenue during the year or prior year.
|
|
2023 £ |
2022 £ |
|
Sweden |
1,436,670 |
142,465 |
|
Germany |
134,668 |
97,178 |
|
UK |
850 |
- |
|
Total non-current assets |
1,572,188 |
239,642 |
Non-current assets consist of intangible assets and tangible assets. Intangible assets are classified under the location where the project is located. Tangible assets are classified where the company holding the asset is incorporated.
|
|
2023 £ |
2022 £ |
|
Employee benefit expense (note 8) |
13,002 |
- |
|
Professional fees |
201,977 |
31,701 |
|
Subcontractors' fees, travel, safety equipment |
208,717 |
35,390 |
|
Business development |
101,991 |
30,524 |
|
Currency losses |
14,911 |
455 |
|
Other expenses |
32,926 |
5,097 |
|
Total administrative costs |
573,524 |
103,167 |
There were no short-term lease payments expensed during year ended 31 December 2023 (2022: £Nil).
Included within note 6 above are exceptional items as shown below:
|
|
2023 £ |
2022 £ |
|
Exceptional items include: |
|
|
|
- Impairment of Hainichen Licence (see note 14) |
44,115 |
- |
|
- Transaction costs relating to forth-coming IPO of Company (see note 27) |
47,310 |
- |
|
Total exceptional Loss |
91,425 |
- |
Services provided by the Company's auditor and its associates. During the year the Group (including its overseas subsidiaries) obtained the following services from the Company's auditor and its associates:
|
|
2023 £ |
2022 £ |
|
Fees payable to Company's auditor for the audit of the Parent Company and consolidated financial statements |
38,000 |
7,000 |
|
Total paid to the Company auditor |
38,000 |
7,000 |
|
Fees payable to other auditors for services: |
|
|
|
- Prior year and interim audit fees paid to previous auditor |
6,050 |
- |
|
- Tax services paid to other auditors |
4,173 |
- |
|
Total paid to other auditors |
10,223 |
- |
|
Total auditor's remuneration |
48,223 |
7,000 |
|
|
2023 £ |
2022 £ |
|
Aggregate emoluments |
- |
- |
|
Social Security Costs |
- |
- |
|
Contribution to defined contribution pension scheme |
- |
- |
|
Total Directors' remuneration |
- |
- |
See further disclosures within the Group Director's Report.
There were no emoluments paid to directors for their services as directors during 2023.
|
|
2023 £ |
2022 £ |
|
Wages and salaries |
10,738 |
- |
|
Social security costs |
1,187 |
- |
|
Pension costs |
1,077 |
- |
|
Total employee benefit expense |
13,002 |
- |
The first employee joined the group in November 2023. A contribution to their pension has been accrued at year end pending the opening of a new pension scheme in 2024 - £1,077 (2022: Nil).
|
|
2023 No. |
2022 No. |
|
Average number of people (including Directors) employed was: Administration |
3 |
2 |
|
Total average number of people employed |
3 |
2 |
Monthly weighted average used in above calculation.
|
|
2023 £ |
2022 £ |
|
Interest expense: - Interest on convertible debt securities (see note 21) |
(43,945) |
(19,915) |
|
Finance costs |
(43,945) |
(19,915) |
|
Finance income - Interest income on bond held by Swedish Mining authority |
14 |
- |
|
Finance income |
14 |
- |
|
Net finance (expense) |
(43,932) |
(19,915) |
11. Income tax expense
|
Group |
2023 £ |
2022 £ |
|
Total current tax charge |
- |
- |
|
Total deferred tax |
- |
- |
The tax charge on the Group's results before tax differs from the theoretical amount that would arise using the standard tax rate applicable to the loss of the consolidated entities as follows:
|
|
2023 £ |
2022 £ |
|
(Loss) before tax |
(708,881) |
(123,082) |
|
Tax calculated at domestic tax rates applicable to UK small profits rate of tax of 19% |
|
|
|
(2022 - 19%) |
(134,687) |
(22,870) |
|
Tax effects of: |
|
|
|
- Expenses not deductible for tax purposes |
(173) |
- |
|
- Losses carried forward |
(134,514) |
22,870 |
|
Total tax charge |
- |
- |
Basic loss per share is calculated by dividing the (Loss) attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.
|
|
2023 £ |
2022 Revised £ |
|
(Loss) for the year |
(708,881) |
(123,082) |
|
|
|
|
|
Weighted average number of Ordinary Shares in issue |
131,874,275 |
94,299,060 |
|
Earnings per share from operations |
£(0.0054) |
£(0.0013) |
There were no EGM share options outstanding as at 31 December 2023.
Post year end, in January 2024, EGM issued 19,082,001 new shares bringing the total number of EGM ordinary shares in issue to 252,425,255.
On 14 March 2024, EGM consolidated the number of ordinary shares in issue by a factor of approx. 4.48 bringing the total number of ordinary shares in issue down to 56,307,702.
Subsequently on 14 March 2024, EGM and EGT completed a share exchange agreement whereby EGT acquired the EGM group by issuing 1 EGT share for each 1 EGM share in issue .
See also note 27 for further post year end details on EGT's subsequent fund raise, creation of EGT share options, initial public offering (IPO) of EGT and admission of EGT to AIM division of London Stock Exchange.
|
Group & Company |
Computer equipment £ |
Total £ |
|
Cost At 1 January 2023 Additions Exchange differences |
- 850 - |
- 850 - |
|
At 31 December 2023 |
850 |
850 |
|
Depreciation At 1 January 2023 Charge for the year Exchange differences |
- - - |
- - - |
|
At 31 December 2023 |
- |
- |
|
Net book value At 31 December 2023 |
850 |
850 |
 |
The equipment was purchased at year end 2023 so depreciation will begin in 2024. There was no movement in 2022, and thus not disclosed in the above table.
|
Group |
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
Cost At 1 January Additions* |
239,642 1,375,811 |
- 239,642 |
108,068 320,687 |
- 108,068 |
|
At 31 December |
1,615,453 |
239,642 |
428,755 |
108,068 |
|
Amortisation and impairment At 1 January Charge for the year Impairment (see note 5) |
- - (44,115) |
- - - |
- - (44,115) |
- - - |
|
At 31 December |
(44,115) |
- |
(44,115) |
- |
|
Net book value At 31 December |
1,571,338 |
239,642 |
384,640 |
108,068 |
* Additions include £1,030,000 non-cash asset acquisition of Swedish Licences via acquisition of European Mineral Exploration AB and Olree AB (see note 15)
The Group reviews the carrying amounts of its intangible assets to determine whether there are any indications that those assets have suffered an impairment loss. If any such indications exist, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Impairment indications include events causing significant changes in any of the underlying valuation assumptions used. In the current year an impairment charge of £44,115 (2022: nil) was made to the Consolidated Income Statement in relation to a German licence which is not being renewed in early 2024. This is as a result of the Directors reviewing ongoing licence programmes and concluding that the Group should concentrate the use of its resources on other core licences.
|
Company |
2023 £ |
2022 £ |
|
Shares in Group undertakings |
|
|
|
At 1 January |
90,000 |
- |
|
Investment in Rockfleet Minerals Limited |
- |
90,000 |
|
Investment in European Mineral Exploration AB |
515,000 |
- |
|
Investment in Olree AB |
515,000 |
- |
|
Investment in European Green Metals (Ireland) Limited |
1 |
- |
|
At 31 December |
1,120,001 |
90,000 |
Investments in Group undertakings are recorded at cost, which is the fair value of the consideration paid. Following review an impairment provision of Nil (2022: Nil) has been made to the investment in subsidiaries.
Swedish registered companies European Mineral Exploration AB (company number 556932-0244) and Olree AB (company number 559402-8465) were acquired by the company on 6 July 2023 for £515,000 each - payable by the issue of a convertible debt security certificate for £450,000 and a cash payment of £65,000. The convertible debt security certificate was convertible to ordinary shares on the admission of the Company to AIM on the London Stock Exchange on or before 30 April 2024. The cash payment was payable within 30 days of the IPO. The Parent Company of EGM, EGT, was admitted to trading on AIM on 8 April 2024 (see note 27).
Irish registered company European Green Metals (Ireland) Limited (company number 750370) is a new company incorporated in October 2023 created to employ Irish-based staff.
All the subsidiaries are included in the consolidation. The proportions of voting shares held by the Parent Company do not differ from the proportion of Ordinary Shares held.
The Group's financial instruments comprise investments, cash at bank, and various items such as debtors, convertible debt security certificates, and creditors. The Group has not entered into derivative transactions, nor does it trade financial instruments as a matter of policy. A detailed description of how risk management is carried out by the Directors of the Group is contained in the strategic report on page 7 and 8.
(a) Assets
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
31 December |
|
|
|
|
|
Assets at amortised cost |
|
|
|
|
|
Trade and other receivables |
1,296 |
3,160 |
82,673 |
48,469 |
|
Cash and cash equivalents |
87,969 |
659,420 |
86,685 |
654,743 |
|
Total |
89,265 |
662,580 |
169,358 |
703,212 |
Assets in the analysis above are all categorised as 'other financial assets at amortised cost' for the Group and Company. Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group'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 Group's reputation.
(b) Liabilities
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
31 December |
|
|
|
|
|
Liabilities at amortised cost |
|
|
|
|
|
Convertible debt security certificates |
1,788,300 |
796,559 |
1,788,300 |
796,559 |
|
Trade and other payables |
338,018 |
41,329 |
324,858 |
41,330 |
|
Total |
2,126,318 |
837,888 |
2,113,158 |
837,889 |
Liabilities in the analysis above are all categorised as 'other financial liabilities at amortised cost' for the Group and Company.
(c) Credit quality of financial assets and liabilities
The Group is exposed to credit risk from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
The Group's maximum exposure to credit risk, due to the failure of counter parties to perform their obligations as at 31 December 2023 and 31 December 2022, in relation to each class of recognised financial assets, is the carrying amount of those assets as indicated in the accompanying Statement of Financial Position.
Cash at bank
The credit quality of cash has been assessed by reference to external credit ratings, based on reputable credit agencies' long-term issuer ratings:
|
Rating |
2023 £ |
2022 £ |
|
A - AAA |
87,969 |
659,420 |
|
Total |
87,969 |
659,420 |
Foreign currency risk
The Group incurs costs denominated in foreign currencies (including Euros and Swedish Krona) which gives rise to short term exchange risk. The Group does not currently hedge against these exposures as they are deemed immaterial and there is no material exposure as at the period end.
Market risk
Market risk is the risk that changes in market prices, such as commodity prices, interest rates, foreign exchange rates, and equity prices will affect the Group's value of its holdings in financial instruments.
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
Trade receivables |
1,296 |
3,160 |
- |
- |
|
Amounts owed by subsidiary undertakings |
- |
- |
82,673 |
48,469 |
|
Total |
1,296 |
3,160 |
82,673 |
48,469 |
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value. The carrying amounts of the Group's trade and other receivables denominated in all currencies were as follows:
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
SEK |
1,296 |
3,160 |
- |
- |
|
Total |
1,296 |
3,160 |
- |
- |
Cash and cash equivalents include the following for the purposes of the statement of cash flows:
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
Cash at bank and on hand |
87,969 |
659,420 |
86,685 |
654,743 |
|
Cash and cash equivalents |
87,969 |
659,420 |
86,685 |
654,743 |
The Directors consider that the carrying amount of cash and cash equivalents approximates to its fair value.
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
Trade payables |
46,953 |
10,541 |
46,953 |
10,543 |
|
Social security and other taxes (see note 8) |
4,645 |
- |
- |
- |
|
Other payables (see note 15) |
130,000 |
- |
130,000 |
- |
|
Accrued expenses |
156,420 |
30,787 |
147,906 |
30,787 |
|
Total |
338,018 |
41,329 |
324,858 |
41,330 |
The fair value of trade and other payables approximates to their book value. All balances are due within 1 year.
Deferred income tax assets are recognised to the extent that the realisation of the related tax benefit through future taxable profits is probable. There is no deferred tax asset recognised for the Group or Company's accumulated losses of £843,741 and £814,623 respectively as the Group and Company are still pre-revenue.
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
Current - falling due within 1 year Convertible debt securities ("CDSs") Non-current - falling due after 1 year Convertible debt securities ("CDSs") |
1,788,300
- |
- 796,559 |
1,788,300
- |
- 796,559 |
|
Total borrowings |
1,788,300 |
796,559 |
1,788,300 |
796,559 |
During 2022 and 2023, the Group issued Convertible Debt Security certificates ("CDS") to a collective of high-net-worth investors. During 2023, there were additional CDSs created of £991,741. Of this balance £900,000 CDSs were issued to the owners of European Mineral Exploration AB and Olree AB on acquisition of those companies in July 2023 (see note 15).
For those CDSs issued in 2022, interest accrued at the rate of 5% per annum and was payable on the six (6) month anniversary of the issue of the Securities and every six (6) months thereafter for two (2) years (i.e. until the second anniversary of the issue of the Securities). Interest was calculated on a 'simple interest' basis. For those CDSs issued in 2023 there was no interest payable. For all CDSs either the principal was fully repayable at the end of year two (2) or all debt security certificates were automatically convertible to ordinary shares if the company had an initial public offering ("IPO") before the end of year two.
Following novation of all CDSs from EGM to EGT in March 2024, the new Parent Company of EGM, EGT, was admitted to trading on AIM on 8 April 2024 so all CDSs have since been converted into ordinary shares in EGT post year end (see note 27).
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
233,343,254 (2022 - 128,500,000) Ordinary shares of £0.0005 |
116,672 |
64,250 |
116,672 |
64,250 |
|
Total |
116,672 |
64,250 |
116,672 |
64,250 |
The share capital of European Green Metals Limited consists only of fully paid ordinary shares. All shares are equally eligible to share in declared dividends, appoint Directors, receive notice of, attend, speak and vote at any general meeting of the Company.
During the year the Company issued 104,843,254 shares @ £0.002/Share as a result of a rights issue to existing shareholders.
23. Other reserves Group and Company Share premium
Share premium is the difference between the nominal value of share capital and the actual cash received on fund-raising less any costs associated with the fund-raising.
Foreign currency reserve
The presentation currency of the Group is GBP£. This reserve arises from the translation of the subsidiaries which are denominated in Euro and SEK into GBP£ on consolidation.
The Euro denominated subsidiaries are Rockfleet Minerals Limited and European Green Metals (Ireland) Limited. The SEK denominated subsidiaries are European Mineral Exploration AB and Olree AB.
Retained Earnings
For the Group and Company, earnings reflect the earnings of European Green Metals Limited.
|
|
Group 2023 £ |
Group 2022 £ |
Company 2023 £ |
Company 2022 £ |
|
(Loss) before income tax Adjustments for: - Net finance costs (note 10) - Impairment of intangible - FX Losses on conversion of CDSs (note 21) Changes in working capital - Decrease/(increase) re trade and other receivables - Increase re VAT tax recoverable - trade and other receivables re Rockfleet Minerals Limited - Increase re trade and other payables - trade and other payables re Rockfleet Minerals Limited |
(708,881)
43,932 44,115 7,140
1,864 (31,548)
- 168,689 - |
(123,082)
19,915 - -
(3,144) -
7,450 38,330
(1,257) |
(680,013)
43,946 44,115 7,140
- (31,372) - 155,527 - |
(122,832)
19,915 - -
- -
- 38,330 - |
|
Net cash (used) in operations |
(474,689) |
(61,789) |
(460,657) |
(64,587) |
25. Related Party Disclosures
Key management are those persons having authority and responsibility for planning, controlling and directing the activities of the Company. In the opinion of the Board, the Company's key management are the Directors of European Green Transition plc.
There were no directors' emoluments paid during 2023.
David Hall, non-executive Director until his resignation on 26 August 2023, invoiced the Company and was paid for his services in relation to consultancy fees for business development opportunities for £53,035 (2022: £28,000).
Aiden Lavelle, non-executive Director from his appointment on 2 October 2023, invoiced the Company and was paid for his consultancy services in relation to geological surveying for £30,284 (2022: Nil).
Robert Whelan, former Company Secretary, is owner/director of Resource HQ consulting Limited and during 2023 Resource HQ consulting Limited invoiced the company and was paid for accountancy services fees of £15,600 (2022:
£11,000) and Robert Whelan invoiced the company and was paid personally for £2,296 (2022: £4,000).
Raglan Professional Services Limited, a company controlled by Cathal Friel, non- executive director, invoiced the Company for services in relation to business development opportunities for £80,630 (2022: Nil). This balance remains unpaid at year end.
Raglan Road Capital Limited, a company controlled by Cathal Friel, non- executive director, provided a bridging loan of
£150,000 to the Company to assist with cash flow during 2023. £2,500 of interest was charged on the loan. This loan plus after-tax interest due was later converted to £152,000 of equity in the Company in November 2023.
Mitaks Investment & Management AB, a company controlled by Daniel Akselson, non-Executive chairman of EGT, was a 10% shareholder, in European Mineral Exploration AB prior to the acquisition by the Company on 6 July 2023. As part of the consideration paid by the Company, Mitaks Investment & Management AB received a convertible debt security certificate for £45,000 plus a deferred cash payment of £6,500. The CDS converted to equity on successful completion of the IPO on 8 April 2024.
There were no other related party transactions during the year.
At 31 December 2023 the Company was owed £82,673 (2022 - £48,469) by its subsidiaries.
The Group had no capital commitments at 31 December 2023 or at 31 December 2022.
The projects are all held under exploration licences, which are due for renewal in the upcoming years. These renewals will incur associated renewal fees. There are various specific costs relating to the continuance of business activities including staffing and consultancy costs, office costs and various sundry items including warehousing commitments for equipment and core storage.
No provision has been made in the financial statements for these amounts as the expenditure items are expected to be incurred in the normal course of business operations. Furthermore, whilst maintaining the current portfolio of exploration interests is the intent of the Group, should activities be ceased in any project, aside from modest exit costs, the costs of that project would cease.
The following events have taken place since the year end:
1. In January and February 2024, 3 additional CDSs valued at £255,000 were issued in EGM. All CDSs were novated to EGT in March 2024.
2. European Green Transition Ltd ("EGT") was incorporated in January 2024. Following a share consolidation in EGM and a share exchange agreement between EGT and EGM in March 2024, EGT became the Parent Company of EGM.
3. In April 2024, EGT was admitted to AIM on the London Stock Exchange following a fund -raise in March 2024 of
£6.4m. All CDSs were converted to equity on admission to AIM.
4. EGT adopted an Employee Performance Incentive Plan ("EPIP") for a number of key senior management in March 2024.
5. EGT signed 12-month option agreements in April 2024 and May 2024 for £125,000 and €100,000 respectively to perform due diligence on the Cyprus copper tailings recycling project and the Irish peatland carbon credits project.
At 31 December 2023 there was no one ultimate controlling party of the EGM group. Since March 2024, the ultimate controlling party of the EGM group is European Green Transition plc - co. reg. number 15442832 at registered address The Walbrook Building, 25 Walbrook, London, EC4N 8AF, UK.