Corcel : Annual Report and Accounts 2022

Registration Number: 05227458

Corcel Plc

Annual Report and Accounts 2022

Contents
	Pages
STRATEGIC REPORT ........................................................................................................................................	2
COMPANY INFORMATION AND ADVISERS .....................................................................................................	2
CHAIRMAN AND CEO STATEMENT ..................................................................................................................	3
STRATEGIC REPORT ........................................................................................................................................	5
GOVERNANCE .................................................................................................................................................	11
CHAIRMAN'S CORPORATE GOVERNANCE STATEMENT ............................................................................	11
QCA CODE 2018 PRINCIPLES ........................................................................................................................	12
BOARD OF DIRECTORS..................................................................................................................................	16
CORPORATE GOVERNANCE FRAMEWORK.................................................................................................	17
MATTERS RESERVED FOR THE BOARD ......................................................................................................	18
BOARD ACTIVITIES .........................................................................................................................................	19
BOARD COMMITTEES.....................................................................................................................................	19
DIRECTORS' REPORT.....................................................................................................................................	21
STATEMENT OF DIRECTORS' RESPONSIBILITIES.......................................................................................	25
INDEPENDENT AUDITOR'S REPORT.............................................................................................................	26
FINANCIAL STATEMENTS ..............................................................................................................................	33
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ............................................................................	33
CONSOLIDATED INCOME STATEMENT.........................................................................................................	34
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ..................................................................	35
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ............................................................................	36
CONSOLIDATED STATEMENT OF CASH FLOWS .........................................................................................	38
COMPANY STATEMENT OF FINANCIAL POSITION.......................................................................................	39
COMPANY STATEMENT OF CHANGES IN EQUITY.......................................................................................	40
COMPANY STATEMENT OF CASH FLOWS....................................................................................................	42
NOTES TO FINANCIAL STATEMENTS ............................................................................................................	43

CORCEL PLC 1

Strategic Report

Company Information and Advisers

Directors	Nominated Adviser	Bankers
James Parsons	WH Ireland	Coutts & Co
Executive Chairman	24 Martin Lane	440 Strand
Scott Kaintz	London EC4R 0DR	London WC2R 0QS
Chief Executive Officer
Henry Bellingham	Accountants	Registrars
Independent Non-Executive	Silvertree Partners LLP	Share Registrars Limited
Director	3rd Floor, 14 Hanover Street	The Courtyard
Ewen Ainsworth	London EC2A 4EB	17 West Street
Non-Executive Director		Farnham
	Tax Advisers	Surrey GU9 7DR
All of	Cameron & Associates Limited	Tel: [phone]
Corcel Plc	35-37 Lowlands Road
(WeWork), 71-91 Aldwych House	Harrow-on-the-Hill
London WC2B 4HN	Middlesex HA1 3AW
Telephone	Auditor
020 7747 9960	PKF Littlejohn LLP
	15 Westferry Circus, Canary Wharf
Website	London E14 4HD
www.corcelplc.com	Broker
Registered Company Number	WH Ireland
05227458	24 Martin Lane
Secretary	London EC4R 0DR
AMBA Secretaries Limited
400 Thames Valley Park Drive
Reading, Berkshire RG6 1PT
Registered Office
Salisbury House
Suite 425, London Wall
London EC2M 5PS

2 CORCEL PLC

Chairman and CEO Statement

Corcel Plc ("Corcel", "CRCL", the "Company" or the "Parent Company") is an AIM listed company strategically increasing its exposure to critical battery metals prior to the widely expected supply crunch and associated structural price increases. Of particular focus for the Company are nickel and cobalt, which are both core battery metals with large supply deficits widely expected in the mid-2020s as the electric vehicle revolution and economic decarbonisation gains pace.

The Company owns 41% of the Mambare nickel-cobalt project in Papua New Guinea, where recent focus by the joint venture has been on securing a mining lease covering a DSO operation at the project. In line with its growth strategy, the Company acquired a second material nickel-cobalt project in Papua New Guinea ("PNG") during the period, signing a share purchase agreement with RMI in August 2021 to acquire 100% of the issued share capital in Australian-registered Niugini Nickel Pty Ltd, which owns 100% of the Wowo Gap nickel-cobalt project. As consideration for the acquisition, the Company released all liabilities and obligations in connection with its previously acquired AUD 4,761,087 senior debt position in Resource Mining Corporation Limited ("RMI"). The Company sees significant synergies between the two PNG battery metal projects and views this acquisition as a significant step in its evolution towards building a leading regional battery metal and nickel /cobalt business with material scale.

Having successfully acquired the Wowo Gap project, the Company then sought to de-risk the project technically and to prepare for a mining lease application. The first steps in this process were to undertake a GAP analysis in anticipation of a Bankable Feasibility Study ("BFS") and the establishment of a JORC 2012 compliant resource for the Wowo Gap project. The JORC resource, which was announced on 17 May 2022, applies much more stringent economic criteria and validates Corcel's underlying rationale for the asset acquisition, confirming Wowo Gap as a similar size and grade deposit to the Company's sister project at Mambare, also in PNG.

Following these advancements of the Wowo gap project, we have now, after the period end, announced our intended structure to fund, continue to grow and ultimately develop the enlarged battery metals portfolio through the creation of a Singapore based upstream Battery Metal joint venture, which will, subject to contract, own CRCL's positions in both the Mambare and Wowo Gap projects. We also intend to add into this joint venture a third battery metal project, namely the Doncella lithium salt brine project in Argentina. The intended joint venture structure, called Integrated Battery Metals ("IBM") offers Corcel a 50% interest carried for the first $1.5m of expenditure as well as a 1.5% gross revenue royalty. Corcel retains control of the JV and will nominate half of the Board while progressing a shared vision with the other parties to list the JV in Singapore.

Alongside the creation of this joint venture, the Company welcomes Shangdong New Power COSMO AM&T ("NPC") as a new cornerstone investor with a significant equity position and Board representation. NPC had previously been in discussions with the Company as a potential offtaker for the PNG portfolio, and ultimately will now invest in both Corcel directly as well as the battery metal projects via the IBM structure.

Following the increased focus on upstream battery metals as its core strategy, and given the looming economic recession, the Company is in the process of strategically winding down its UK based gas peaker and battery storage portfolio. This has been progressed via the announced sale of the Tring Road gas peaker project, which lowers the Company's debt burden following a restructuring in October 2022 with a view to freeing up further capital for immediate operational and capital commitments. The Board is now actively working to further de-leverage the Company by repaying all of its debts well before they become due.

The Company has also recently further broadened its portfolio with the application for the Star Mountains Gold-Copper tenement in PNG and in securing an option on the Mt. Weld rare earth project in Western Australia. These opportunities are potentially large upside projects for Corcel, which only require minimal upfront capital to access.

During these challenging times in global and domestic markets, the Board is very cognisant that the continued support of our key stakeholders, including lenders, shareholders and the new cornerstone investor, remains critical. We report during the period that the Group incurred a loss of £2.128 million whilst finance costs over the year increased to £0.224 million, reflecting increased interest and finance fees (2021: £0.065million). Overall, administrative costs increased slightly for the year to £1.26 million (2021: £1.0 million) largely reflecting increased insurance costs, professional services costs, share based payments (non-cash) and payroll costs.

CORCEL PLC 3

Chairman and CEO Statement

continued

We are amongst the first movers in this space in the micro-cap sector and we believe that our shareholders will, in due course, see significant rewards from the hard miles we have covered building the foundations to support our present strategic positioning, which now includes both an intended Singapore listed joint venture as well as investments from large industrial and strategic partners.

We therefore are pleased to present the Annual Report and Accounts for the year to 30 June 2022.

James Parsons	Scott Kaintz
Executive Chairman	Chief Executive Officer

4 CORCEL PLC