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ANGLESEY MINING PLC - Annual Financial Report

Tuesday, July 23, 2013 10:02 AM


ANGLESEY MINING PLC - Annual Financial Report

Anglesey Mining plc
A UK mining company listed on the London Stock Exchange
Anglesey is the founder and holder of 15% of Toronto-listed Labrador Iron Mines
Holdings Limited (TSX:LIM) which is producing iron ore from its James deposit,
one of LIM's direct shipping iron ore deposits in western Labrador and
north-eastern Quebec. Development of other deposits is planned and production
of the high grade hematite iron ore is targeted to grow from 1.7 million tonnes
in 2012 to between 1.75 and 2 million tonnes in 2013.
Anglesey is carrying out exploration, development and pre-feasibility work at
its 100% owned Parys Mountain underground zinc-copper-lead-silver-gold deposit
in North Wales, UK.
Anglesey owns 19.3m LIM shares (15%) and has issued 161m of its own shares all
of which are admitted to trading on the London Stock Exchange.
Chairman's Statement
In a year of difficult trading conditions in all resource sectors I am pleased
to report that the company is weathering the storm and will see through the
remainder of this current downturn. At Labrador Iron which we formed in 2007
and is today Canada's only independent iron ore producer, the significant
variability in iron ore prices during the second half of 2012 resulted in large
reported losses and put a drain on the cash resources of that company. However
four major funding events in late 2012 and early 2013 provided LIM with the
necessary capital to enable it to enter its third year of mining operations
which I am happy to report is now well under way. At Parys Mountain, following
last summer's successful exploration programme, we are taking the opportunity
to review all the information available on the project and to consider the best
alternatives whilst minimising expenditure at the current time.
All mining stocks are suffering in the current marketplace and both Labrador
Iron and Anglesey Mining have been part of this severe downturn. We hope that
as LIM demonstrates its current production capability, and with the benefit of
a price protection programme in place to guard against any repeat of last
year's low prices, that the market will recognise the inherent value in LIM
which should be reflected in the Anglesey share price.
There is undoubtedly pressure on commodity prices largely as a result of some
reduction in the growth rate in China, however we do not support the notion
that there will be a return to the levels of the early years of this century.
Iron ore prices have come off from their all-time highs but remain relatively
strong and it is far from certain that the forecast increase in supply will
actually occur since many of the previously announced large undeveloped
projects are likely to find financing impossible to obtain. Meanwhile base
metals, which have slipped from their highs, also remain firm and with limited
new production coming on line or even planned, we look for significant
improvement in the middle term.
Our strategy therefore is to weather the current turbulent times, to retain
cash where possible, to maintain our holding in Labrador Iron which today has a
market value of almost £7 million and to leave ourselves ready and able to move
forward when metal prices and capital markets return to more positive
territory.
Labrador Iron
Following the initial production year in 2011, 2012 began well and production
was on target to meet the target of 2.0 million tonnes of saleable product.
However a major downturn in iron ore prices in August and September which saw
spot prices for 62% Fe CFR China fall from around $120 per tonne to $85 per
tonne in just four weeks left LIM in a vulnerable position in which it had no
alternative but to cut all expenditure and curtail some production.
Nevertheless iron ore sales for the year amounted to just over 1.5 million
tonnes and LIM reported revenues from mining operations of C$96 million.
Last year was also very successful on the exploration front with new techniques
permitting more and better drilling to be carried out for lower costs, and all
this new information led to significant increases in compliant resources
particularly on the Houston and Malcolm deposits, which will form the core of
the next ten years production, and on the development of a maiden 620 million
tonne taconite deposit close to LIM's current infrastructure.
After the financial difficulties in late 2012 it was necessary to rebuild the
LIM balance sheet and I am pleased to report that very encouraging support was
received from the market place and $C59 million was raised in two equity issues
in late 2012 and early 2013. LIM also entered into a strategic agreement with
Tata Steel Canada regarding cooperation on a number of matters including the
sale of a 51% interest in the Howse property which will result in the payment
to LIM of $C30 million on completion. After the end of the financial year LIM
also received a $35 million prepayment from RB Metalloyd as part of a two year
iron ore sales agreement.
LIM began its third year of mining operations in late March 2013 and is now in
full swing. Sales of between 1.75 and 2.0 million tonnes of iron ore are
targeted this year. To guard against what now looks to be an annual dip in iron
ore prices during the autumn period, LIM has put in place a price protection
programme for 825,000 tonnes of iron ore at a floor price of $105 per tonne.
Parys Mountain
During the summer of 2012 we completed a successful exploration drilling
programme at Parys Mountain. This work demonstrated that mineralisation at
economic grades exists across at least 1.5 kilometres from the Morris Shaft
area in the west of the property to the Pearl engine house area in the east.
This work was followed by the production by Micon International of a JORC
compliant resource estimate on the majority of the known and readily reachable
development targets. Micon had produced a JORC resource for White Rock
previously but this new estimate also brought both the Engine zone and Garth
Daniel resources into a modern compliant basis compared to the historical
estimates upon which the company had been reliant since 1990.
Micon had also made progress on a scoping study for Parys Mountain but given
the current market conditions the company has decided to have a fundamental
review of the technical and geological information available and to evaluate
all the options for moving this project forward to production.
In July 2012 a net profits royalty on production from Parys Mountain was bought
out and cancelled and outstanding advance royalty payments of £759,680 were
settled for a cash payment of £630,000 and the issue of 2,000,000 ordinary
shares. Cancellation of that royalty will improve both the economics and the
ability to finance the Parys Mountain project.
We hold freehold title to the area of Parys Mountain that contains all our
known resources and infrastructure. We have very low on-going cash commitments
and these remain well within the current financial capability of the company,
allowing us the benefit of time to make assessment without any risk of loss of
resources.
We continue to closely watch base metal markets both from a price perspective
as well as from materials supply view. We remain confident that the zinc copper
and lead in Parys Mountain will improve firstly in relative demand which will
flow through to higher prices in the medium term and we will be well prepared
to take advantage of this at the appropriate time.
Financial Results
There was a large loss after tax of £31,451,398 for the year ended 31 March
2013. This compared to a profit of £19,386,555 reported in 2012. In both years
a major factor was non-cash charges in respect of the accounting treatment of
deemed disposals in LIM. These arise when LIM issues new shares to third
parties; in 2012 they resulted in profits and in 2013 in losses due to the
lower share prices at which these issues were made in that year. In addition,
LIM reported significant operating losses in 2013 as well as amortisation
charges and write downs in intangible assets.
During the year the group's holding in LIM was diluted from 26% to 15% as a
result of the new share issues by LIM. Consequently LIM ceased to be treated as
an associate for accounting purposes and an accounting loss of £16,149,722 was
recorded on recognition of the associate as an investment accounted for at fair
value through profit and loss. There was a further non-cash loss of £3,791,439
over the period following the reclassification as an investment at fair value.
The group's cash balance at 31 March 2013 was £670,345 (2012 - £3,150,644). The
decrease from last year was due to the investment in LIM shares in November
2012 for £950,927, the cancellation of the Parys net profits royalty, Parys
development expenditures and administrative expenses.
The group's operating and administrative costs for the year were £398,428 (2012
- £396,807).
Ian Cuthbertson
It would be remiss of me not to mention that Ian Cuthbertson will be leaving us
at the end of July. Ian has been with Anglesey since its flotation in 1988 and
has been much involved with all the developments with their highs and lows
since then. During this time he has held the posts of accountant, company
secretary and finance director. However this does not tell the full story and
during this 25 year period of service he has been a central part, and indeed
for much of that time the major part, of the management of the company. Ian
will still be available give us on-going advice using his extensive knowledge
of the history and activities of the company - we wish him the very best of
good fortune in his retirement and in the years to come.
Outlook
We are in a period in which patience will be a great virtue. We certainly need
to see how LIM develops during 2013 but with its current year production plan
well under way and with autumn prices protected we remain comfortable that an
improvement is ahead. At Parys Mountain we do have the benefit of time if
needed and we will take that opportunity to develop the most rational approach
available under current and predicted price and market scenarios.
John F. Kearney
Chairman
23 July 2013

Directors' report
The directors are pleased to submit their report and the audited accounts for
the year ended 31 March 2013.
Principal activities and business review
The group is engaged in the business of developing the wholly-owned Parys
Mountain project in North Wales and has a 15% holding (2012 - 26%) in the
Labrador iron project in eastern Canada.
Labrador Iron Mines is currently producing from its James deposit in Labrador,
LIM's target is to ship between 1.75 and 2 million tonnes of iron ore in the
2013 season.
At Parys Mountain a programme of geophysical and overburden sampling work was
completed and 1,815 metres of diamond coring in 11 holes was drilled between
January and the end of June 2012.
The group continues its search for other mineral exploration and development
opportunities.
The aim of the group is to continue its participation in the Labrador projects,
to create value in the Parys Mountain property, including by co-operative
arrangements where appropriate, and to actively engage in other mineral
ventures using the group's own resources together with such external investment
and finance as may be required.
Labrador Iron
Production commenced at the James mine in June 2011 and up to the end of 2012
two million dry tonnes of iron ore has been produced and sold into the Chinese
spot market in 13 cape-size shipments. Operations are seasonal, from
approximately the beginning of April to the end of November each year, with a
planned winter shut down.
During the year ended 31 March 2013 significant operational progress was made
and necessary decisive action was taken to respond to severe market conditions.
LIM met its reduced production target of 1.7 million wet tonnes of iron ore
production and sold a total of just over 1.5 million dry tonnes of iron ore
products, a substantial improvement from the 385,898 dry tonnes sold in fiscal
2012. The reduction of the original planned target of 2 million tonnes for 2012
was in response to market conditions and weaker spot iron ore prices during the
second half of calendar 2012. Five million tonnes of ship loading capacity was
secured at the new multi-user berth being built by the Port of Sept-Iles,
providing the opportunity to load cape size shipments when the berth and
terminal handling facility are completed.
LIM had a very successful exploration season, which included extensive drilling
of Houston, Malcolm, James North and James South, as well as bulk sampling
historic stockpiles. Exploration work also resulted in an initial resource of
620 million tonnes on the Elizabeth taconite deposit located near the currently
producing James mine.
Despite the many operational accomplishments, the year ended 31 March 2013 was
adversely impacted by the rapid and severe drop in spot iron ore prices which
occurred between August 2012 and November 2012. Iron ore spot prices and
transaction volumes suffered a sharp decline in August, with spot prices
dropping 33% during that quarter to below US$90 per tonne on a 62% Fe CFR China
basis. In response revised strategies were implemented in the mine, process
plant and rail transport areas and a critical review of operating and capital
spending resulted in decisive measures to reduce costs and conserve cash. These
included utilization of the new lower cost dry classifying system to produce
sinter and lump ore only; deferring all non-committed capital expenditures
relating to the Silver Yards processing plant and also deferring approximately
$52 million of additional planned capital investment originally budgeted for
2012 largely on the Houston project.
In addition a $30 million equity financing was completed in November 2012 and a
further $29 million equity financing was completed in February 2013. LIM
believes that the cost reductions in operations combined with the deferral of
capital expenditures were necessary steps and will ensure continued sustainable
activities. In March 2013 a strategic relationship arrangement with Tata Steel
was agreed whereby the two companies will cooperate with each other in various
aspects of their respective iron ore operations in the Labrador Trough and as
part this, upon completion of the formal agreements, LIM will receive $30
million for the sale of a 51% interest in LIM's Howse deposit.
Subsequent to the fiscal year-end a US$35 million advance payment against the
sale of iron ore to be delivered in 2013 and 2014 was secured and a new two
year iron or sales agreement with Iron Ore Company of Canada was agreed.
Full scale production of iron ore re-commenced as planned in April 2013 and
production of approximately 1.75 to 2.0 million tonnes of saleable product
during the 2013 operating season is targeted.
Resources
As at 31 March 2013, LIM has confirmed a total of approximately 59.5 million
tonnes at an average grade of 56.7% Fe of NI 43-101 compliant, measured and
indicated mineral resources on the Schefferville Projects. Of this total,
approximately 36.9 million tonnes are measured mineral resources and
approximately 22.5 million tonnes are indicated resources. There is also a
total of approximately 4.7 million tonnes of inferred resources at an average
grade of 55.8% Fe. In addition to the foregoing, there are previously mined
historical stockpiles, with a NI 43-101 compliant, indicated resource of
approximately 3.5 million tonnes at an average grade of 49.1% Fe and an
inferred resource of approximately 2.9 million tonnes at an average grade of
48.8% Fe.
LIM Financial
Revenues from mining operations for the year were $95.7 million, net of ocean
freight and IOC's participation, on sales of approximately 1.56 million dry
tonnes of iron ore in ten shipments completed during fiscal 2013. Revenues were
negatively impacted by a decline of 33% in the spot price of iron ore during
the period from August to October 2012.
For 2013 LIM reported a loss of $129.7 million, or $1.56 per share, compared to
a loss of $14.7 million, or $0.27 per share, during the previous fiscal year.
The variance in the results of operations relates largely to an operating loss
before depletion and depreciation of $28.9 million in fiscal 2013, depletion
and depreciation of $29.7 million, a write-down of mineral property interests
of $58.1 million and a $3.1 million provision against certain doubtful
receivables. In the previous year, no operating loss or depletion and
depreciation charges were recorded, since the commencement of commercial
production for accounting purposes began on 1 April 2012.
Parys Mountain
The Parys Mountain property is a significant UK base metal deposit where a
feasibility study carried out in 1991 identified a resource of 6.5 million
tonnes containing zinc, copper and lead with small amounts of silver and gold.
The study demonstrated the technical and economic viability of bringing the
property into production at a rate of 350,000 tonnes per annum, producing zinc,
copper and lead concentrates.
At Parys there is a head frame, a 300m deep production shaft and planning
permission for operations, consequently the lead time to production is expected
to be relatively short. The group has freehold ownership of the minerals and
surface land and there is substantial exploration potential. Infrastructure is
good, political risk is low and the project has the support of local people and
government.
During the year drilling continued as part of the programme commenced in
January 2012. Initially this was in the shallower White Rock area to the west
of the property after which the rig was moved to two locations near the Great
Open Cast pit and ended the programme with three holes from a location adjacent
to the Pearl engine house in the east of the property, the last of these being
completed in July 2012.
All the stages of this programme are considered to have been successful. Whilst
it was a little disappointing that the upper portions of the Engine zone, near
the White Rock zone in the west, could not be established at economic grades
and widths at higher levels, the results in the first two holes did extend the
potentially viable zone upwards.
The Pearl area drilling is particularly encouraging as it opens up an area that
is more than one kilometre away from the Morris Shaft and in conjunction with
previous results from the Garth Daniel area which lie midway between the Pearl
engine house and Morris Shaft locations demonstrates that mineralisation at
potentially economic grades and widths occurs across the entire property.
Following the drilling programme the first property-wide JORC Code-compliant
resource estimate was prepared by Micon International Co Limited ("Micon"):
Parys Mountain Mineral Resource estimate at $80 per tonne GMPV* cut-off
Zone               Category   Tonnes     Cu %     Pb %    Zn %   Ag g/t  Au g/t
Engine             Indicated   489,000   1.38     2.61    4.99    92.80   0.50
                   Inferred    121,000   1.74     3.42    6.74    70.00   0.50
Deep Engine        Inferred    618,000   1.95     1.90    4.22    23.00   0.20
White Rock         Indicated 1,625,000   0.34     2.05    3.84    33.00   0.50
                   Inferred    534,000   0.38     1.93    4.04    41.00   0.40
Garth Daniel       Inferred    299,000   2.06     3.07    6.43    75.00   0.20
Northern           Inferred  2,542,000   1.48     0.56    0.94    6.00    0.40
Total              Indicated 2,114,000   0.58     2.18    4.11    46.00   0.50
                   Inferred  4,114,000   1.46     1.20    2.40    20.00   0.30
Source: Micon. GMPV (gross mineral product value) based on Cu $3.50/lb, Pb
$1.00/lb, Zn $0.90/lb, Ag $33/oz, Au $1700/oz;
This new estimate follows a previous report by Micon in 2007 that dealt only
with the White Rock deposit. The current estimate includes all the known
contiguous deposits on site and is reported on a JORC Code-compliant basis.
With the exception of the 2007 White Rock estimate, the previous resource was
historical (estimated in 1990) and was not JORC Code-compliant. In now
reporting all estimates on a JORC Code-compliant basis the project has been
brought up to date and put in a position to be properly recognised for future
funding.
The Garth Daniel zone had been partially identified in 1990 but benefitted from
a further drilling programme in 2005 and 2006. The current estimate draws all
this information together. The Northern zone was previously poorly identified
and without any significant continuity. Micon has now shown such continuity to
exist and has defined a major resource for two discreet overlapping structures.
There are several other areas on Parys Mountain that have had exploration and
drilling carried out on them that have not been included in these estimates.
These include the area between the Deep Engine zone and Garth Daniel, and the
area around the Pearl Engine House that was drilled earlier this year. These
and other targets will be subject to additional exploration in the future, and
it is hoped that additional data will enable further continuity to be
demonstrated with subsequent additions to the resource base.
At the appropriate time it is planned to carry out additional development and
drilling to bring some or all of the Inferred mineral resource in to the
Indicated mineral resource category. This will be dependent on funding and, in
some cases, underground access to these areas.
In producing its estimates, Micon has followed all the normal procedures
required to make a JORC Code-compliant estimate. These have included a
validation of the drill hole database, construction of wireframes around the
various deposits, basic statistical analysis of the resultant assay data to
identify the extent to which top-cutting was required, the basis for assay
compositing, detailed variography analysis to identify the principal trends of
the mineralisation, appropriate block sizes to represent the volume of the
mineralisation and a determination of the appropriate search ellipsoid to be
applied for grade interpolation in each deposit. Grade interpolation using
Ordinary Kriging was then applied to the block model and the data was
validated. Specific gravity data was reviewed to develop bulk densities for
tonnage calculations.
A mineral resource estimate was then made based on a suite of metal prices.
These metal prices were assigned to each block and the sum of the products of
these prices and the various block grades produced a single Gross Metal Product
Value ("GMPV") value for each block. Micon reported the mineral resources by
category following the guidelines of the JORC Code, for a range of GMPV cut-off
values from $0 per tonne to $200 per tonne.
The resource estimate methodology employed now is quite different from that
used in 1990 and provides a higher degree of confidence than previously
enjoyed. This methodology has resulted in differing grade:tonnage combinations
than previously reported.
There are technical and other matters to be addressed to ensure that the
project moves towards production, however the directors are of the opinion that
this project is at an advanced state and the existence of the original
feasibility study, together with the valid planning permissions, will do much
to reduce both the volume of work required to move the project into production
and the risks associated with this work.
In July 2012 an agreement was reached with Intermine Limited in respect of the
termination of a net profits royalty on production from Parys Mountain. A cash
payment of C$1,000,000 (£630,000) was made and 2,000,000 ordinary shares in the
company issued to discharge the amount due to Intermine of £759,680 at 31 March
2012 and to cancel the royalty in its entirety and release the charge.
After due consideration the directors have decided that an impairment review is
not required in respect of the Parys Mountain mineral asset on the balance
sheet.
Operation of the mine and the receipt of cashflows from it are dependent on
finance being available to fund the development of the property.
Other activities
Management continues to search for new properties suitable for development
within a relatively short time frame and within the financing capability likely
to be available to the group.
Performance
The directors expect to be judged by results of project development and/or
exploration and by their success in creating long term value for shareholders.
The group holds shares in Labrador Iron Mines Holdings Limited and has
interests in exploration and evaluation properties and, until economically
recoverable reserves can be developed, there are no standardised performance
indicators which can usefully be employed to gauge the performance of the
group, other than the market price of the company's shares.
The chief external factors affecting the ability of the group to move forward
are primarily the demand for metals and minerals, levels of metal prices and
exchange rates; these and other factors are dealt with in the risks and
uncertainties section below.
Dividend
The group has no revenues and the directors are unable to recommend a dividend
(2012 - nil).
Financial position
The group has no revenues from the operation of its properties. The loss for
the year after tax was £31,451,398 compared to a profit of £19,386,555 in 2012.
The profit in 2012 was primarily due to the effects of gains on deemed
disposals which resulted from LIM's fund raisings during that year. Similar LIM
share issues in 2013 have also diluted the company's holding but have resulted
in substantial losses due to the lower share prices at which these issues were
made in this current period. LIM's own losses increased significantly in 2013
as did the group's share of those losses for the period during which LIM
remained as an associate.
During the year the group's holding in LIM has been diluted from 26% to 15%.
From the date on which this holding fell below 20% in November 2012, its
accounting treatment has changed and LIM is now held as an investment. This
change resulted in charges to the income statement of £16,677,214 in 2013 (2012
- nil) and there was a further loss in value for the period from November 2012
to 31 March 2013 charged to the income statement.
Administrative and other costs in the UK excluding investment income and
finance charges were £398,428 compared to £396,807 in the previous year.
During the year there were no additions to fixed assets (2012 - nil) and £
497,748 (2012 - £355,225) was capitalised in respect of the development of the
Parys Mountain property. As in 2012 most of this cost was in respect of the
drilling programme at Parys Mountain however in 2013 there were also charges
for resource estimations and scoping studies, and for the cancellation of a net
profits royalty interest in Parys Mountain held by Intermine Limited.
The group's cash balance at 31 March 2013 was £670,345 (2012 - £3,150,644),
this decrease from last year being due to the purchase of LIM shares in
November 2012, the net profits royalty cancellation referred to above,
expenditures on the development of Parys Mountain (including drilling costs and
feasibility study fees) and administrative expenses. The foreign exchange gain
of £11,196 (2012 - loss £41,914) shown in the income statement arises on the
cash balances held in Canadian dollars.
At 31 March 2013 the company had 160,608,051 ordinary shares in issue,
2,000,000 more than last year as a result of the issue of shares to Intermine
Limited.
The directors believe that the group has adequate funding for its current and
proposed operations.
Risks and uncertainties
In conducting its business the group faces a number of risks and uncertainties
some of which have been described above in regard to particular projects.
However, there are also risks and uncertainties of a nature common to all
mineral projects and these are summarised below.
General mining risks
Actual results relating to, amongst other things, mineral reserves, mineral
resources, results of exploration, capital costs, mining production costs and
reclamation and post closure costs, could differ materially from those
currently anticipated by reason of factors such as changes in general economic
conditions and conditions in the financial markets, changes in demand and
prices for minerals that the group expects to produce, legislative,
environmental and other judicial, regulatory, political and competitive
developments in areas in which the group operates, technological and
operational difficulties encountered in connection with the group's activities,
labour relations, costs and changing foreign exchange rates and other matters.
The mining industry is competitive in all of its phases. There is aggressive
competition within the mining industry for the discovery and acquisition of
properties considered to have commercial potential. The group faces strong
competition from other mining companies in connection with the acquisition and
retention of properties, mineral claims, leases and other mineral interests as
well as for the recruitment and retention of qualified employees and other
personnel.
Development and liquidity risk
The company has adequate funds for its current and planned operations. LIM is
believed to be fully funded for the foreseeable future.
Exploration and development
Exploration for minerals and development of mining operations involve risks,
many of which are outside the group's control. The group currently operates in
politically stable environments and hence is unlikely to be subject to
expropriation of its properties but exploration by its nature is subject to
uncertainties and unforeseen or unwanted results are always possible.
Metal prices
The prices of metals fluctuate widely and are affected by many factors outside
the group's control. The relative prices of metals and future expectations for
such prices have a significant impact on the market sentiment for investment in
mining and mineral exploration companies. Metal price fluctuations may be
either exacerbated or mitigated by international currency fluctuations which
affect the actual amount which might be received by the group in sterling.
Foreign exchange
LIM is a Canadian company and the value of the group's holding in LIM is
affected by an exchange rate risk. Operations at Parys Mountain are in the UK
and exchange rate risks are minor. The majority of the cash balance at the
year-end was held in sterling - see notes 17 and 24.
Permitting, environment and social
The group holds planning permission for the development of the Parys Mountain
property but further consents will be required to carry out proposed activities
and these permits may be subject to various reclamation and operational
conditions.
LIM conducts its operations in Labrador and Quebec, in areas which are subject
to conflicting First Nations land claims. There is a number of First Nations
peoples living in the Quebec-Labrador peninsula with overlapping claims to
asserted aboriginal land rights. Aboriginal claims to lands, and the
conflicting claims to traditional rights between aboriginal groups, which also
overlap the Quebec-Labrador provincial border, may have an impact on LIM's
ability to operate and develop the Schefferville deposits.
Employees and personnel
The group is dependent on the services of a small number of key executives
including the chairman, chief executive and finance director. The loss of these
persons or the group's inability to attract and retain additional highly
skilled and experienced employees for the operations of LIM or any other areas
in which the group might engage may adversely affect its business or future
operations.
Financial instruments
The group's use of financial instruments is described in note 24.
Directors
The names of the directors with biographical details are shown on the inside
rear cover. It is the company's procedure to submit re-election resolutions for
all directors at each annual general meeting. Ian Cuthbertson who has been
employed by the company since July 1988 is to retire on 31 July 2013 and Danesh
Varma will take over his duties as finance director and company secretary. Ian
will continue to provide services to the company in connection with the Parys
Mountain project under a consulting agreement.
The company maintains a directors' and officers' liability policy on normal
commercial terms which includes third party indemnity provisions. The powers of
the directors are described in the Corporate Governance Report.
With regard to the appointment and replacement of directors, the company is
governed by its Articles, the Corporate Governance Code, the Companies Act and
related legislation. The Articles themselves may be amended by special
resolution of the shareholders. Under the Articles, any director appointed by
the board during the year must retire at the AGM following his appointment. In
addition, the Articles require that one-third of the remaining directors retire
by rotation at each general meeting and seek re-appointment. However it is now
the company's practice to submit re-election resolutions for all directors at
each AGM.
Directors' interests in material contracts
Juno Limited (Juno), which is registered in Bermuda, holds 36.1% of the
company's ordinary share capital. The company has a controlling shareholder
agreement and working capital agreement with Juno. Advances made under the
working capital agreement are shown in note 19. Apart from interest charges
there were no transactions between the group and Juno or its group during the
year. An independent committee reviews and approves any transactions and
potential transactions with Juno. Danesh Varma is a director and, through his
family interests, a significant shareholder of Juno.
John Kearney is chairman and chief executive of LIM, Bill Hooley is a director
and vice-chairman of LIM and Danesh Varma is a director of LIM. All three are
shareholders of LIM, are entitled to remuneration from LIM. There are no
transactions between LIM, the group and the company which are required to be
disclosed.
There are no other contracts of significance in which any director has or had
during the year a material interest.
Directors' shareholdings
The interests of the directors in the share capital of the company, all of
which are beneficial, are set out below:
                     17 July 2013        31 March 2013        31 March 2012
    Director     Number of  Number of Number of  Number of Number of  Number of
                  options   ordinary   options   ordinary   options   ordinary
                             shares               shares               shares
John Kearney      5,000,000         -  5,000,000         -  5,000,000         -
Bill Hooley       2,500,000   200,000  2,500,000   200,000  2,500,000   100,000
Ian Cuthbertson   1,500,000 1,120,300  1,500,000 1,120,300  1,500,000 1,120,300
David Lean          450,000         -    450,000         -    450,000         -
Howard Miller       600,000         -    600,000         -    600,000         -
Roger Turner        500,000         -    500,000         -    500,000         -
Danesh Varma      1,000,000         -  1,000,000         -  1,000,000         -
                 11,550,000 1,320,300 11,550,000 1,320,300 11,550,000 1,220,300

Further details of directors' options are provided in the Directors'
Remuneration Report.
Substantial shareholders
At 17 July 2013 shareholders had advised the company of the following
interests in the issued ordinary share capital:
Name                                    Number of  Percentage
                                           shares    of share
                                                      capital
Juno Limited                           57,924,248    36.1%

Shares
Disapplication of pre-emption rights
The directors would usually wish to allot any new share capital on a
pre-emptive basis, however in the light of the group's potential requirement to
raise further funds for the acquisition of new mineral ventures, other
activities and working capital, they believe that it is appropriate to have a
larger amount available for issue at their discretion without pre-emption than
is normal for larger listed companies. In the case of allotments other than for
rights or other pre-emptive issues, it is proposed that such authority will be
for a nominal value of up to £401,500 of share capital being 40,150,000
ordinary shares, which is equivalent to 25% of the issued ordinary share
capital at 17 July 2013. Whilst such authority is in excess of the 5% of
existing issued ordinary share capital which is commonly accepted for larger
listed companies, it will provide additional flexibility which the directors
believe is in the best interests of the group in its present circumstances. It
is the directors' present intention to renew this power each year.
Rights and obligations attaching to shares
The rights and obligations attaching to the ordinary and deferred shares are
set out in the Articles of Association. Details of the issued share capital are
shown in note 21. Details of employee share schemes are set out in the
Directors Remuneration Report and in note 22.
Each ordinary share carries the right to one vote at general meetings of the
company. Holders of deferred shares, which are of negligible value, are not
entitled to attend, speak or vote at any general meeting of the company, nor
are they entitled to receive notice of general meetings.
Subject to the provisions of the Companies Act 2006, the rights attached to any
class may be varied with the consent of the holders of three-quarters in
nominal value of the issued shares of the class or with the sanction of an
extraordinary resolution passed at a separate general meeting of the holders of
the shares of the class.
There are no restrictions on the transfer of the company's shares.
Voting rights
Votes may be exercised at general meetings in relation to the business being
transacted either in person, by proxy or, in relation to corporate members, by
corporate representative. The Articles provide that forms of proxy shall be
submitted not less than 48 hours before the time appointed for holding the
meeting or adjourned meeting.
No member shall be entitled to vote at a general meeting or at a separate
meeting of the holders of any class of shares in the capital of the company,
either in person or by proxy, in respect of any share held by him unless all
monies presently payable by him in respect of that share have been paid.
Furthermore, no shareholder shall be entitled to attend or vote either
personally or by proxy at a general meeting or at a separate meeting of the
holders of that class of shares or on a poll if he has been served with a
notice after failing to provide the company with information concerning
interests in his shares required to be provided under the Companies Act 2006.
Significant agreements and change of control
There are no agreements between the company and its directors or employees that
provide for compensation for loss of office or employment that may occur
because of a takeover bid. The company's share plans contain provisions
relating to a change of control. Outstanding awards and options would normally
vest and become exercisable on a change of control, subject to the satisfaction
of any performance conditions.
Employment, community, donations and environment
The group is an equal opportunity employer in all respects and aims for high
standards from and for its employees. It also aims to be a valued and
responsible member of the communities which it affects or operates in. Since
there are no revenues from operations, it is the group's general policy not to
make charitable or political donations and none were made during the year (2012
- nil).
The group has no operations; consequently its effect on the environment is very
slight, being limited to the operation of two small offices, where recycling
and energy usage minimisation are taken seriously and encouraged. It is not
practical or useful to quantify the effects of these measures. There are no
social or community issues which require the provision of further information
in this report.
Creditor payment policy
The group conducts its business on the normal trade credit terms of each of its
suppliers and tries to ensure that suppliers are paid in accordance with those
terms. The group's average creditor payment period at 31 March 2013 was 17 days
(2012 - 113 days).
Going concern
The directors have considered the business activities of the group as well as
its principal risks and uncertainties as set out in this report. When doing so
they have carefully applied the guidance given in the Financial Reporting
Council's document "Going concern and liquidity risk: Guidance for directors of
UK companies 2009". Based on the group's cash flow forecasts and projections to
December 2014, and after making due enquiry in the light of current and
anticipated economic conditions, the directors consider that the group and
company have adequate resources to continue in business for the foreseeable
future. For this reason, the going concern basis continues to be adopted in the
preparation of the financial statements.
Post balance sheet events
See note 30.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial
statements. The directors are required to prepare the financial statements for
the group in accordance with International Financial Reporting Standards as
adopted by the European Union ("IFRS") and have also elected to prepare
financial statements for the company in accordance with IFRS. Company law
requires the directors to prepare such financial statements in accordance with
IFRS, the Companies Act 2006 and, in relation to the group financial
statements, Article 4 of the IAS Regulation.
International Accounting Standard 1 requires that financial statements present
fairly for each financial year the group's financial position, financial
performance and cash flows. This requires the faithful representation of the
effects of transactions, other events and conditions in accordance with the
definitions and recognition criteria for assets, liabilities, income and
expenses set out in the International Accounting Standards Board's `Framework
for the Preparation and Presentation of Financial Statements'. In virtually all
circumstances, a fair presentation will be achieved by compliance with all
applicable International Financial Reporting Standards.
Directors are also required to:
  * properly select and apply accounting policies;
  * present information, including accounting policies, in a manner that
    provides relevant, reliable comparable and understandable information;
  * provide additional disclosures when compliance with the specific
    requirements in IFRS is insufficient to enable users to understand the
    impact of particular transactions, other events and conditions on the
    entity's financial position and financial performance; and
  * make an assessment of the company's ability to continue as a going concern.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
parent and the group, for safeguarding the assets, for taking reasonable steps
for the prevention and detection of fraud and other irregularities and for the
preparation of a directors' report and directors' remuneration report which
comply with the requirements of the Companies Act 2006.
The directors confirm that the financial statements have (a) been prepared in
accordance with applicable accounting standards; (b) give a true and fair view
of the results of the group and the assets, liabilities and financial position
of the group and the parent company; and (c) that the directors' report
includes a fair review of the development and performance of the business and
the position of the group and the parent company together with a description of
the principal risks and uncertainties that they face.
The directors are responsible for the maintenance and integrity of the group
website.
Auditor
Each of the directors in office at the date of approval of the annual report
confirms that so far as they are aware there is no relevant audit information
of which the company's auditor is unaware and that each director has taken all
of the steps which they ought to have taken as directors in order to make
themselves aware of that information. This confirmation is given and should be
interpreted in accordance with the provisions of s418 of the Companies Act
2006.
A resolution to reappoint Mazars LLP as auditor and to authorise the directors
to fix their remuneration will be proposed at the annual general meeting.
By order of the board
Ian Cuthbertson
Company Secretary
23 July 2013

Report of the auditor to the members of Anglesey Mining plc
We have audited the financial statements of Anglesey Mining plc for the year
ended 31 March 2013 which comprise the Group Income Statement, the Group
Statement of Comprehensive Income, the Group and Company Statement of Financial
Position, the Group and Company Statement of Changes in Equity, the Group and
Company Statement of Cash Flows and the related notes. The financial reporting
framework that has been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by the European
Union.
Respective responsibilities of directors and auditor
As explained more fully in the Directors' Responsibilities Statement on pages 9
and 10, the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view.
Our responsibility is to audit and express an opinion on the financial
statements in accordance with applicable law and International Standards on
Auditing (UK and Ireland). Those standards require us to comply with the
Auditing Practices Board's (APB's) Ethical Standards for Auditors. This report
is made solely to the company's members as a body in accordance with Chapter 3
of Part 16 of the Companies Act 2006. Our audit work has been undertaken so
that we might state to the company's members those matters we are required to
state to them in an auditor's report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the company and the company's members as a body for our audit work,
for this report, or for the opinions we have formed.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on
the Financial Reporting Council's website at www.frc.org.uk/
auditscopeukprivate.
Opinion on the financial statements
In our opinion the financial statements:
  * give a true and fair view of the state of the group's and of the parent
    company's affairs as at 31 March 2013 and of the group's profit for the
    year then ended;
  * have been properly prepared in accordance with IFRSs as adopted by the
    European Union; and
  * have been prepared in accordance with the requirements of the Companies
    Act.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion:
  * the part of the Directors' Remuneration Report to be audited has been
    properly prepared in accordance with the Companies Act 2006;
  * the information given in the Directors' Report for the financial year for
    which the financial statements are prepared is consistent with the
    financial statements; and
  * the information given in the Corporate Governance Statement with respect to
    internal control and risk management systems in relation to financial
    reporting processes and about share capital is consistent with the
    financial statements and rules 7.2.5 and 7.2.6 of the Disclosure and
    Transparency Rules.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the
Companies Act 2006 requires us to report to you if, in our opinion:
  * adequate accounting records have not been kept, or returns adequate for our
    audit have not been received from branches not visited by us; or
  * the parent company financial statements and the part of the Directors'
    Remuneration Report to be audited are not in agreement with the accounting
    records and returns; or
  * certain disclosures of directors' remuneration specified by law are not
    made; or
  * we have not received all the information and explanations we require for
    our audit; or
  * a Corporate Governance Statement has not been prepared by the company.
Under the Listing Rules we are required to review:
  * the directors' statement, set out on pages 9 and 10, in relation to going
    concern;
  * the part of the Corporate Governance Statement relating to the company's
    compliance with the nine provisions of the UK Corporate Governance Code for
    reporting periods commencing on or after 29 June 2010 specified for our
    review; and
  * certain elements of the report to the shareholders by the Board on
    directors' remuneration.
Richard Metcalfe (Senior Statutory Auditor)
for and on behalf of Mazars LLP
Chartered Accountants and Statutory Auditor
Tower Bridge House, St. Katharine's Way, London, E1W 1DD
23 July 2013

Financial statements
Group income statement
All attributable to equity holders of the company
                                   Notes   Year ended  Year ended
                                             31 March    31 March
                                                 2013        2012
All operations are continuing                 £            £
  Revenue                                           -           -
  Expenses                                  (398,428)   (396,807)
  Share of loss of associate        14a   (4,572,320) (3,484,140)
  (Losses)/gains on deemed          14a   (6,793,789)  23,374,274
  disposals in associate
  Loss on reclassification of       14b  (16,149,722)           -
  associate as an investment
  Loss on fair value of investment  14b   (3,791,439)           -
  Exchange difference on loss       14b       321,186           -
  above
  Investment income                  6         36,941      49,041
  Finance costs                      7      (115,023)   (113,899)
  Foreign exchange profit/(loss)               11,196    (41,914)
(Loss)/profit before tax             4   (31,451,398)  19,386,555
  Tax                                8              -           -
(Loss)/profit for the period             (31,451,398)  19,386,555
  (Loss)/profit per share
  Basic - pence per share            9        (19.7)p      12.2 p
  Diluted - pence per share          9        (19.7)p      11.6 p

Group consolidated statement of comprehensive income
(Loss)/profit for the period             (31,451,398)  19,386,555
  Other comprehensive income:
  Exchange difference on                      975,771   (379,827)
  translation
  of foreign holding in year
  Exchange difference on                  (4,216,941)           -
  translation of
  foreign holding reclassified to
  income statement
Total comprehensive (loss)/income        (34,692,568)  19,006,728
for the period

Statement of financial position of the group
                                            31 March    31 March
                                                2013        2012
                                   Notes      £           £
Assets
  Non-current assets
  Mineral property development      10    14,753,566  14,255,818
  Property, plant and equipment     11       204,687     204,687
  Interest in associate             14             -  41,240,859
  Investment                        14     7,964,532           -
  Deposit                           15       122,204     121,685
                                          23,044,989  55,823,049
  Current assets
  Other receivables                 16        40,239      64,991
  Cash and cash equivalents         17       670,345   3,150,644
                                             710,584   3,215,635
Total assets                              23,755,573  59,038,684
Liabilities
  Current liabilities
  Trade and other payables          18     (100,677) (1,040,961)
                                    17
                                           (100,677) (1,040,961)
  Net current assets                         609,907   2,174,674
  Non-current liabilities
  Loan                              19   (2,306,283) (2,191,260)
  Long term provision               20      (42,000)    (42,000)
                                         (2,348,283) (2,233,260)
Total liabilities                        (2,448,960) (3,274,221)
Net assets                                21,306,613  55,764,463
Equity
  Share capital                     21     7,116,914   7,096,914
  Share premium                            9,848,949   9,634,231
  Currency translation reserve                     -   3,241,170
  Retained earnings                        4,340,750  35,792,148
Total shareholders' equity                21,306,613  55,764,463

The financial statements of Anglesey Mining plc were approved by the board of
directors, authorised for issue on 23 July 2013 and signed on its behalf by:
John F. Kearney, Chairman
Ian Cuthbertson, Finance Director

Statement of financial position of the company
                                  Notes  31 March    31 March
                                           2013        2012
                                             £           £
Assets
   Non-current assets
   Investments                     13    13,956,680  13,698,575
                                         13,956,680  13,698,575
   Current assets
   Other receivables               16        26,102      24,071
   Cash and cash equivalents       17       623,215   1,063,330
                                            649,317   1,087,401
Total Assets                             14,605,997  14,785,976
Liabilities
   Current liabilities
   Trade and other payables        18      (70,516)   (107,418)
                                           (70,516)   (107,418)
   Net current assets                       578,801     979,983
   Non-current liabilities
   Loan                            19   (2,306,283) (2,191,260)
                                        (2,306,283) (2,191,260)
   Total liabilities                    (2,376,799) (2,298,678)
Net assets                               12,229,198  12,487,298
Equity
   Share capital                   21     7,116,914   7,096,914
   Share premium                          9,848,949   9,634,231
   Retained losses                      (4,736,665) (4,243,847)
Shareholders' equity                     12,229,198  12,487,298
The financial statements of Anglesey Mining plc registered number 1849957 were
approved by the board of directors and authorised for issue on 23 July 2013,
and signed on its behalf by:
John F. Kearney, Chairman
Ian Cuthbertson, Finance Director

Statements of changes in equity
All attributable to equity holders of the company.
 Group                     Share     Share    Currency     Retained      Total
                          capital   premium  translation   earnings
                                               reserve
                             £         £          £           £            £
 Equity at 1 April 2011  7,092,414 9,621,181   3,620,997   15,748,173   36,082,765
 Total comprehensive
 income for the year:
 Profit for the year             -         -           -   19,386,555   19,386,555
 Exchange difference on          -         -   (379,827)            -    (379,827)
 translation of foreign
 holding
 Total comprehensive             -         -   (379,827)   19,386,555   19,006,728
 income for the year
 Shares issued for cash      4,500    19,073           -            -       23,573
 Share issue costs               -   (6,023)           -            -      (6,023)
 Equity-settled benefits         -         -           -      657,420      657,420
 credit:
 - associate
 Equity at 31 March 2012 7,096,914 9,634,231   3,241,170   35,792,148   55,764,463
 Total comprehensive
 income for the year:
 (Loss) for the year             -         -           - (31,451,398) (31,451,398)
 Exchange difference on          -         -     975,771            -      975,771
 translation of foreign
 holding
 Eliminate foreign               -         - (4,216,941)            -  (4,216,941)
 holding
 exchange difference
 Total comprehensive             -         - (3,241,170) (31,451,398) (34,692,568)
 loss for the year
 Shares issued              20,000   220,000           -            -      240,000
 Share issue costs               -   (5,282)           -            -      (5,282)
 Equity at 31 March 2013 7,116,914 9,848,949           -    4,340,750   21,306,613
 Company                             Share      Share      Retained      Total
                                   capital £  premium £    losses £        £
 Equity at 31 March 2011           7,092,414   9,621,181  (3,747,888)   12,965,707
 Total comprehensive
 income for the year:
 Loss for the year                         -           -    (495,959)    (495,959)
 Total comprehensive                       -           -    (495,959)    (495,959)
 loss for the year
 Shares issued for cash                4,500      19,073            -       23,573
 Share issue costs                         -     (6,023)            -      (6,023)

 Equity at 31 March 2012           7,096,914   9,634,231  (4,243,847)   12,487,298
 Total comprehensive
 income for the year:
 Loss for the year                         -           -    (492,818)    (492,818)
 Total comprehensive                       -           -    (492,818)    (492,818)
 loss for the year
 Shares issued                        20,000     220,000            -      240,000
 Share issue costs                         -     (5,282)            -      (5,282)

 Equity at 31 March 2013           7,116,914   9,848,949  (4,736,665)   12,229,198

Statement of cash flows of the group
                                   Notes   Year ended   Year ended
                                             31 March     31 March
                                                 2013         2012
                                              £            £
Operating activities
  (Loss)/profit for the period           (31,451,398)   19,386,555
  Adjustments for non-cash items:
  Investment revenue                 6       (36,941)     (49,041)
  Finance costs                      7        115,023      113,899
  Share of loss of associate        14a     4,572,320    3,484,140
  Losses/(gains) on deemed          14a     6,793,789 (23,374,274)
  disposals in associate
  Loss on reclassification of       14a    16,149,722            -
  associate as an investment
  Loss on fair value of investment  14b     3,791,439            -
  Exchange difference on loss       14b     (321,186)            -
  above
  Foreign exchange movement                  (11,196)       41,914
                                            (398,428)    (396,807)
  Movements in working capital
  Decrease/(increase) in                       24,753     (42,522)
  receivables
  (Increase)/decrease in payables            (36,902)        7,047
Net cash used in operating                  (410,577)    (432,282)
activities
Investing activities
  Investment revenue                           36,422       48,502
  Mineral property development            (1,166,413)    (112,459)
  Addition to AFS investment in             (950,927)            -
  LIM
Net cash used in investing activities     (2,080,918)     (63,957)
Financing activities
  Proceeds from issue of shares                     -       17,550
  Loan received                                                  -
Net cash generated from financing                   -       17,550
activities
Net decrease in cash                      (2,491,495)    (478,689)
and cash equivalents
Cash and cash equivalents at start          3,150,644    3,671,247
of period
Foreign exchange movement                      11,196     (41,914)
Cash and cash equivalents at end    17        670,345    3,150,644
of period

Statement of cash flows of the company
                                  Notes  Year ended  Year ended
                                           31 March    31 March
                                               2013        2012
                                             £           £
Operating activities
  Loss for the period              23     (492,818)   (495,959)
  Adjustments for non-cash items:
  Investment revenue                       (27,361)    (26,969)
  Finance costs                             115,023     113,899
                                          (405,156)   (409,029)
  Movements in working capital
  Increase in receivables                   (2,031)     (9,040)
  (Increase)/decrease in payables          (36,902)       7,047
Net cash used in operating                (444,089)   (411,022)
activities
Investing activities
  Interest received                          27,361      26,969
  Investments and long term loans       (1,122,585)   (161,904)
Net cash used in investing              (1,095,224)   (134,935)
activities
Financing activities
  Proceeds from issue of shares                   -      17,550
  Inter-company loan received             1,099,198      93,600
Net cash generated from financing         1,099,198     111,150
activities
Net decrease in cash and cash             (440,115)   (434,807)
equivalents
Cash and cash equivalents at              1,063,330   1,498,137
start of period
Cash and cash equivalents at end            623,215   1,063,330
of period

Notes to the financial statements
1 General information
Anglesey Mining plc is domiciled and incorporated in England and Wales under
the Companies Act. The nature of the group's operations and its principal
activities are set out in note 3 and in the business review section of the
directors' report. The registered office address is as shown on the rear cover.
These financial statements are presented in pounds sterling because that is the
currency of the primary economic environment in which the group has been
operating. Foreign operations are included in accordance with the policies set
out in note 2.
2 Significant accounting policies
Basis of Accounting
The group and company financial statements have been prepared in accordance
with International Financial Reporting Standards (IFRS) as adopted by the
European Union and therefore the group financial statements comply with Article
4 of the EU IAS Regulation.
The financial statements have been prepared on the historical cost basis. The
principal accounting policies adopted are set out below.
Going concern
The financial statements are prepared on a going concern basis. The validity of
the going concern basis is dependent on finance being available for the
continuing working capital requirements of the group for a period of twelve
months from the date of approval of the accounts. For the reasons set out in
the directors' report, the directors believe that the going concern basis is
appropriate for these accounts.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the company and entities controlled by the company (its subsidiaries) made up
to 31 March each year. Control is achieved where the company has the power to
govern the financial and operating policies of an investee entity so as to
obtain benefits from its activities.
On acquisition, the assets and liabilities and contingent liabilities of a
subsidiary are measured at their fair values at the date of acquisition. Any
excess of the cost of acquisition over the fair values of the identifiable net
assets acquired is recognised as goodwill. Any deficiency of the cost of
acquisition below the fair values of the identifiable net assets acquired (i.e.
discount on acquisition) is credited to the income statement in the period of
acquisition. The results of subsidiaries acquired or disposed of during the
year are included in the group income statement from the effective date of
acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with those used by
the group. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
Investment in associate
An associate is an entity over which the group exercises, or is in a position
to exercise, significant influence, but not control or joint control, through
participation in the financial or operating policy of the investee. In
considering the degree of control, any options or warrants over ordinary shares
which are capable of being exercised at the period end are taken into
consideration.
Where material, the results and assets and liabilities of associates are
incorporated in the financial statements using the equity method of accounting,
except when these associates are classified as held for sale. Investments in
associates are carried in the statement of financial position at cost adjusted
by any material post-acquisition changes in the net assets of the associates,
less any impairment of value in the individual investments.
Investments in associates cease to be treated as associates using the equity
method of accounting when the group loses significant influence. Any retained
interest is treated as an investment in accordance with IAS 39 `Financial
Instruments: Recognition and Measurement'. The transaction is treated as a
disposal of interest in the associate, with any difference arising between the
fair value of the retained interest, and the carrying value of the associate at
the date significant influence is lost recognised as a profit or loss on
reclassification within the income statement.
Revenue recognition
Interest income is accrued on a time basis, by reference to the principal
outstanding and at the effective interest rate applicable, which is the rate
that exactly discounts estimated future cash receipts through the expected life
of the financial asset to that asset's net carrying amount.
Foreign currencies
Transactions in currencies other than pounds sterling are recorded at the rates
of exchange prevailing on the dates of the transactions. At the end of each
reporting period, monetary assets and liabilities that are denominated in
foreign currencies are retranslated at the rates prevailing on the period end
date. Non-monetary assets and liabilities carried at fair value that are
denominated in foreign currencies are translated at the rates prevailing at the
date when the fair value was determined. Gains and losses arising on
retranslation are included in net profit or loss for the period.
On consolidation, the assets and liabilities of the group's overseas operations
are translated at exchange rates prevailing on the period end date. Exchange
differences arising, if any, are classified as items of other comprehensive
income and transferred to the group's translation reserve within equity. Such
translation differences are reclassified to profit or loss, and recognised as
income or as expense, in the period in which the operation is disposed.
Segmental analysis
Operating segments are identified on the basis of internal reports about
components of the group that are regularly reviewed by the chief operating
decision-maker.
Retirement benefit costs
Payments to defined contribution retirement benefit schemes are charged as an
expense as they fall due. There are no defined benefit retirement schemes.
Equity-settled employee benefits
The group provides equity-settled benefits to certain employees. Equity-settled
employee benefits are measured at fair value at the date of grant. The fair
value determined at the grant date is expensed on a straight-line basis over
the vesting period, based on the group's estimate of shares that will
eventually vest and adjusted for the effect of non-market based vesting
conditions.
Fair value is measured by use of a Black-Scholes model. The expected life used
in the model has been adjusted from the longer historical average life, based
on directors' estimates of the effects of non-transferability, exercise
restrictions, market conditions, age of recipients and behavioural
considerations.
Taxation
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the period end liability method. Deferred
tax liabilities are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary
differences can be utilised. Such assets and liabilities are not recognised if
the temporary difference arises from goodwill or from the initial recognition
(other than in a business combination) of other assets and liabilities in a
transaction that affects neither the tax profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences
arising on investments in subsidiaries and associates, and interests in joint
ventures, except where the group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
The carrying amount of any deferred tax assets is reviewed at each period end
date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset is realised. Deferred tax is
charged or credited in the income statement, except when it relates to items
charged or credited directly to equity, in which case the deferred tax is also
dealt with in equity.
Property, plant and equipment
The group's freehold land is stated in the statement of financial position at
cost. The directors consider that the residual value of buildings, based on
prices prevailing at the date of acquisition, is such that any depreciation
would not be material. The carrying value is reviewed annually and any
impairment in value would be charged immediately to the income statement.
Plant, equipment, fixtures and motor vehicles are stated in the statement of
financial position at cost, less depreciation. Depreciation is charged on a
straight line basis at the following annual rates: plant and equipment 25% and
motor vehicles 25%. Residual values and the useful lives of these assets are
also reviewed annually.
Intangible assets - mineral property development costs
Intangible assets are stated in the statement of financial position at cost,
less accumulated amortisation and provisions for impairment.
Costs incurred prior to obtaining the legal rights to explore a mineral
property are expensed immediately to the income statement. Mineral property
development costs are capitalised until the results of the projects, which are
usually based on geographical areas, are known. Mineral property development
costs include an allocation of administrative and management costs as
determined appropriate to the project by management.
Where a project is successful, the related exploration costs are amortised over
the life of the estimated mineral reserve on a unit of production basis. Where
a project is terminated, the related exploration costs are expensed
immediately. Where no internally-generated intangible asset can be recognised,
development expenditure is recognised as an expense in the period in which it
is incurred.
Impairment of tangible and intangible assets
The values of mineral properties are reviewed annually for indications of
impairment and when these are present a review to determine whether there has
been any impairment is carried out. They are written down when any impairment
in their value has occurred and are written off when abandoned. Where a
provision is made or reversed it is dealt with in the income statement in the
period in which it arises.
Investments
Investments in subsidiaries are shown at cost less provisions for impairment in
value. Income from investments in subsidiaries together with any related
withholding tax is recognised in the income statement in the period to which it
relates.
Provisions
Provisions are recognised when the group has a present obligation as a result
of a past event and it is probable that the group will be required to settle
that obligation. Provisions are measured at the directors' best estimate of the
expenditure required to settle that obligation at the end of the reporting
period and are discounted to present value where the effect is material.
Financial instruments
Financial assets and liabilities are initially recognised and subsequently
measured based on their classification as "loans and receivables", "available
for sale financial assets" or "other financial liabilities".
Loans and receivables are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. They are
included in current assets, except where they mature more than 12 months after
the period end date: these are classified as non-current assets.
(a) Trade and other receivables. Trade and other receivables are measured at
initial recognition at fair value and are subsequently measured at amortised
cost using the effective interest rate method. Appropriate allowances for
estimated irrecoverable amounts are recognised in the income statement when
there is objective evidence that the asset is impaired.
(b) Cash and cash equivalents. The group considers all highly liquid
investments which are readily convertible into known amounts of cash and have a
maturity of three months or less when acquired to be cash equivalents. The
management believes that the carrying amount of cash equivalents approximates
fair value because of the short maturity of these financial instruments.
(c) Available for sale financial assets. Listed shares held by the group that
are traded in an active market are classified as being AFS and are stated at
fair value. Gains and losses arising from changes in fair value are recognised
in other comprehensive income and accumulated in the investments revaluation
reserve with the exception of impairment losses and foreign exchange gains and
losses on monetary assets, which are recognised directly in profit or loss.
Where the investment is disposed of or is determined to be impaired, the
cumulative gain or loss previously recognised in the investments revaluation
reserve is reclassified to profit or loss.
Dividends on AFS equity instruments are recognised in profit or loss when the
group's right to receive the dividends is established.
The fair value of AFS monetary assets denominated in a foreign currency is
determined in that foreign currency and translated at the spot rate at the
balance sheet date. The foreign exchange gains and losses that are recognised
in profit or loss are determined based on amortised cost of the monetary asset.
Other foreign exchange gains and losses are recognised in other comprehensive
income.
(d) Trade and other payables. Trade payables are not interest bearing and are
initially recognised at fair value and subsequently measured at amortised cost
using the effective interest rate method.
(e) Deposits. Deposits are recognised at fair value on initial recognition and
are subsequently measured at amortised cost using the effective interest rate
method.
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received,
net of direct issue costs.
Leases
Leases are classified as finance leases whenever the terms of the lease
transfer substantially all the risks and rewards of ownership to the lessee.
All other leases are classified as operating leases.
Mining lease payments are recognised as an operating expense in the income
statement on a straight line basis over the lease term. There are no finance
leases or other operating leases.
New accounting standards
The group and company have adopted the amendments to the following
interpretation:
IFRS 7 Financial Instruments: Amendments related to the offsetting of assets
and liabilities; Issued - December 2011; Effective - Annual periods beginning
on or after 1 July 2011
IAS 12 Income Taxes: Limited scope amendments (recovery of underlying assets);
Issued - December 2010; Effective - Annual periods beginning on or after 1
January 2012
There has been no impact of adopting the amendments.
The group and the company have not applied the following IFRS, IAS and IFRICs
that are applicable and have been issued but are not yet effective:
IFRS 9 Financial Instruments; Original issue; Issued - November 2009; Effective
- Annual periods beginning on or after 1 January 2015
IFRS 10 Consolidated Financial Statements: Original issue; Issued October 2012;
Effective - Annual periods beginning on or after 1 January 2014
IFRS 11 Joint Arrangements: Original issue; Issued - May 2011; Effective -
Annual periods beginning on or after 1 January 2013
IFRS 12 Disclosure of Interests in Other Entities: Original issue; Issued - May
2011; Effective - Annual periods beginning on or after 1 January 2014
IFRS 13 Fair Value Measurement: Original issue; Issued - May 2011; Effective -
Annual periods beginning on or after 1 January 2013
IAS 1 Presentation of Financial Statements: Amendments to revise the way other
comprehensive income is presented; Issued - June 2011; Effective - Annual
periods beginning on or after 1 July 2012
IAS 19 Employee Benefits: Original issue; Issued - Amended June 2011; Effective
- Annual periods on or after 1 January 2013.
IAS 27 Separate Financial Statements (as amended in 2011): Original issue;
Issued - May 2011; Effective - Annual periods beginning on or after 1 January
2013
IAS 28 Investments in Associated and Joint Ventures: Original issue; Issued -
May 2011; Effective - Annual periods beginning on or after 1 January 2013
IAS 32 Financial Instruments: Presentation: Amendments relating to the
offsetting of assets and liabilities; Issued - December 2011; Effective -
Annual periods beginning on or after January 2014
IAS 36 Impairment of Assets: Amendments arising from Recoverable Amounts
Disclosure for Non-financial Assets; Issued - 2004, Amended - May 2013;
Effective Annual periods beginning on or after 1 January 2014
IAS 39 Financial Instruments: Amendments for novation of derivatives; Amended
June 2013; Effective for Annual periods beginning on or after 1 January 2014
IAS 39 Financial Instruments: Recognition and Measurement; Original issue;
Issued - June 2013; Effective for Annual periods beginning on or after 1
January 2014
IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine; Effective -
Annual periods beginning on or after 1 January 2013
IFRIC 21 Levies; Effective - Annual periods beginning on or after 1 January
2014.
The directors expect that the adoption of the above pronouncements will have no
material impact to the financial statements in the period of initial
application other than disclosure.
The directors do not consider the adoption of the amendments resulting from the
Annual Improvements 2009 - 2011 cycle will result in a material impact on the
financial information of the group and company. These amendments to IAS 1, IAS
16 and IAS 32 are effective for accounting periods beginning on or after 1
January 2013.
There have been no other new or revised International Financial Reporting
Standards, International Accounting Standards or Interpretations that are in
effect since that last annual report that have a material impact on the
financial statements.
Judgements made in applying accounting policies and key sources of estimation
uncertainty
The following critical judgements have been made in the process of applying the
group's accounting policies:
(a) Following the reduction in the group's holding in Labrador Iron Mines
Holdings Limited to less than 20% in November 2012, the directors' believe that
the group does not have significant influence and does not control the
activities and operations of LIM, and that this holding should be accounted for
as an investment.
(b) In determining the treatment of exploration, evaluation and development
expenditures the directors are required to make estimates and assumptions as to
future events and circumstances. There are uncertainties inherent in making
such assumptions, especially with regard to: ore resources and the life of a
mine; recovery rates; production costs; commodity prices and exchange rates.
Assumptions that are valid at the time of estimation may change significantly
as new information becomes available and changes in these assumptions may alter
the economic status of a mining unit and result in resources or reserves being
restated. Operation of a mine and the receipt of cashflows from it are
dependent on finance being available to fund the development of the property.
(c) In connection with possible impairment of assets the directors assess each
potentially cash generating unit annually to determine whether any indication
of impairment exists. The judgements made when doing so are similar to those
set out above and are subject to the same uncertainties.
Nature and purpose of equity reserves
The share premium reserve represents the consideration that has been received
in excess of the nominal value of shares on issue of new ordinary share
capital.
The currency translation reserve represents the revaluation of overseas foreign
subsidiaries and associates.
The retained earnings reserve represents profits and losses retained in
previous and the current period.
3 Segmental information
The group is engaged in the business of developing the wholly-owned Parys
Mountain project in North Wales and has an investment in the Labrador iron
project in eastern Canada. During the year the group's holding in LIM has been
diluted from 26% to 15%. From the date on which this holding fell below 20%,
its accounting treatment has changed and LIM is now held as an investment. In
the opinion of the directors, the group's activities comprise one class of
business which is mine development. The group reports geographical segments;
these are the basis on which information is reported to the board.
Income statement
analysis
                                   2013                                 2012
                       UK         Canada -    Total              UK    Canada -       Total
                                investment                           investment
                        £          £            £             £          £           £
Expenses            (398,428)            -    (398,428)   (396,807)           -   (396,807)
Share of loss in            -  (4,572,320)  (4,572,320)           - (3,484,140) (3,484,140)
associate
(Loss)/gain on              -  (6,793,789)  (6,793,789)           -  23,374,274  23,374,274
deemed disposals
Loss on recognition         - (16,149,722) (16,149,722)           -           -           -
of
associate as an
investment
Loss on fair value          -  (3,791,439)  (3,791,439)           -           -           -
of investment
Exchange difference         -      321,186      321,186           -           -           -
on loss above
Investment income      36,941            -       36,941      49,041           -      49,041
Finance costs       (115,023)            -    (115,023)   (113,899)           -   (113,899)
Exchange rate loss     11,196            -       11,196    (41,914)           -    (41,914)
(Loss)/profit for   (465,314) (30,986,084) (31,451,398)   (503,579)  19,890,134  19,386,555
the year

Assets and
liabilities
                              31 March 2013                        31 March 2012
                        UK        Canada -    Total               UK   Canada -       Total
                                investment                           investment
                         £          £           £             £          £           £
Assets               15,791,041  7,964,532  23,755,573    17,797,825 41,240,859  59,038,684
Liabilities         (2,448,960)          - (2,448,960)   (3,274,221)          - (3,274,221)
Net assets           13,342,081  7,964,532  21,306,613    14,523,604 41,240,859  55,764,463

4 Operating result
The operating result for the year has been
arrived at after charging:
                                      2013           2012
                                         £              £
Fees payable to the group's
auditors:
for the audit of the annual         30,329         28,871
accounts
for the audit of subsidiaries'       5,000          5,000
accounts
for other services - taxation        6,551          9,547
compliance
Directors' remuneration            139,000        112,297
Director's pension                  20,000         20,000
contributions
Foreign exchange (gain)/loss      (11,196)         41,914

5 Staff costs
The average monthly number of persons employed (including
executive directors) was:
                                          2013        2012
Administrative                               3           3
                                             3           3
Their aggregate remuneration was:            £           £
Wages and salaries                     100,000      73,297
Social security costs                   11,733      12,868
Other pension costs                     20,000      20,000
                                       131,733     106,165

Details of directors' remuneration and share options are given in the
directors' remuneration report.
6 Investment income
                                     2013           2012
                                   £              £
Loans and receivables
Interest on bank deposits          36,423         48,502
Interest on site                      518            539
re-instatement deposit 15
                                   36,941         49,041

7 Finance costs
                                     2013           2012
Loans and payables                 £              £
Loan interest to Juno Limited     115,023        113,899
19


8 Taxation
Activity during the year has generated trading losses for taxation purposes
which may be offset against investment income and other revenues. Accordingly
no provision has been made for Corporation Tax. There is an unrecognised
deferred tax asset at 31 March 2013 of £1.2 million (2012 - £1.2 million)
which, in view of the group's trading results, is not considered by the
directors to be recoverable in the short term. There are also capital
allowances, including mineral extraction allowances, of £12.3 million unclaimed
and available at 31 March 2013 (2012 - £11.8 million). No deferred tax asset is
recognised in respect of these allowances.
                                          2013           2012
                                             £              £
Current tax                                  -              -
Deferred tax                                 -              -

Total tax                                    -              -
Domestic income tax is calculated at 24% of the estimated
assessed profit for the year. In 2012 the
rate used was 26% and the change this year is due to a change in
Corporation Tax rates. Taxation for
other jurisdictions is calculated at the rates prevailing in
the relevant jurisdictions.
The total charge for the year can be reconciled to the
accounting profit or loss as follows:
(Loss)/profit for the year        (34,692,568)     19,386,555

Tax at the domestic income tax     (8,326,216)      5,040,504
rate of 24% (2012 - 26%)
Tax effect of:
Losses/(gains) on deemed             1,630,509    (6,077,311)
disposals in associate
Share of loss of associate           1,097,357        905,876
Losses on interest in associates     5,598,350        130,931
and investments
Total tax                                    -              -

9 Earnings per ordinary share
                                         2013            2012
                                            £               £
Earnings
(Loss)/profit for the year       (31,451,398)      19,386,555
Number of shares
Weighted average number of        159,966,407     158,403,406
ordinary shares for the purposes
of basic earnings per share
Shares deemed to be issued for              -       8,884,238
no consideration in respect of
employee options
Weighted average number of        159,966,407     167,287,644
ordinary shares for the purposes
of diluted earnings per share
Basic earnings per share              (19.7)p           12.2p
Diluted earnings per share            (19.7)p           11.6p

As the group has a loss for the year ended 31 March 2013 the effect of the
11.55 million options
outstanding is anti-dilutive and diluted earnings are reported to be the same
as basic earnings.
10 Mineral property development costs - group
                               Parys
                            Mountain
Cost                               £
At 1 April 2011           13,900,593
Additions - site             259,156
Additions - rentals &         96,069
charges
At 31 March 2012          14,255,818
Additions - site             468,837
Additions - rentals &         28,911
charges
At 31 March 2013          14,753,566
Carrying amount
Net book value 2013       14,753,566
Net book value 2012       13,900,593

Included in the additions are mining lease expenses of £15,500 (2012 - £11,225)
and £113,241 for the cancellation of the Intermine net profits royalty
agreement (2012 - nil).
The Parys Mountain property is currently being explored and evaluated and there
are no grounds to believe that the asset is impaired.
11 Property, plant and equipment
Group               Freehold   Plant &    Office   Total
                    land and equipment equipment
                    property
Cost                       £         £         £       £
At 1 April 2010      204,687    17,434     5,487 227,608
At 31 March 2011,    204,687    17,434     5,487 227,608
2012 and 2013
Depreciation
At 1 April 2010            -    17,434     5,487  22,921
At 31 March 2011,          -    17,434     5,487  22,921
2012 and 2013
Carrying amount
At 31 March 2011,    204,687         -         - 204,687
2012 and 2013
Company             Freehold   Plant &    Office   Total
                    land and equipment equipment
                    property
Cost                       £         £         £       £
At 1 April 2010            -    17,434     5,487  22,921
At 31 March 2011,          -    17,434     5,487  22,921
2012 and 2013
Depreciation
At 1 April 2010            -    17,434     5,487  22,921
At 31 March 2011,          -    17,434     5,487  22,921
2012 and 2013
Carrying amount
At 31 March 2011,          -         -         -       -
2012 and 2013
12 Subsidiaries - company
The subsidiaries of the company at 31 March 2013 and 2012 were as follows:
Name of company            Country of   Percentage     Principal
                          incorporation   owned        activity
Labrador Iron plc          Isle of Man     100%      Holder of the
                                                       company's
                                                     investment in
                                                     Labrador Iron
                                                    Mines Holdings
                                                        Limited
Anglo Canadian              England &      100%         Dormant
Exploration (Ace) Limited     Wales
Parys Mountain Mines        England &      100%     Development of
Limited                       Wales                    the Parys
                                                    Mountain mining
                                                       property
Parys Mountain Land         England &      100%    Holder of part of
Limited                       Wales                    the Parys
                                                   Mountain property
Parys Mountain Heritage     England &      100%    Holder of part of
Limited                       Wales                    the Parys
                                                   Mountain property
13 Investments - company
                          Shares at          Loans          Total
                               cost
                                  £              £              £
At 1 April 2011             100,103     13,530,168     13,630,271
Advanced                          -        161,904        161,904
Repaid                            -       (93,600)       (93,600)
At 31 March 2012            100,103     13,598,472     13,698,575
Advanced                          -      1,357,303      1,357,303
Repaid                            -    (1,099,198)    (1,099,198)

At 31 March 2013            100,103     13,856,577     13,956,680

The realisation of investments is dependent on finance being available for
development and on a number of other factors.
No interest was charged in the year on inter-company loans.
14 a Interest in associate
LIM is a company registered in Ontario Canada, which is independently managed
and is the 100% owner and operator of a series of iron ore properties in
Labrador and Quebec, many of which were formerly held and initially explored by
the group. On 6 November 2012 the group's holding in LIM was diluted from 26%
to 15% as a result of LIM share issues to third party interests. From that date
its accounting treatment has changed and LIM is now held as an investment.
  Value in group financial               31 March    31 March
  statements                                 2013        2012
  while held as an associate:
                                                £           £
  Value brought forward from           41,240,859  21,073,132
  previous period
  Group's share of losses of          (4,786,514) (3,484,140)
  associate
  Group's share of equity-settled         214,194     657,420
  benefits included in losses above
  and now added back
  (Loss)/profit on deemed disposals   (6,793,789)  23,374,274
  following
  LIM share issues
  Exchange rate movement                  975,771   (379,827)
  Loss on adjustment to fair value   (20,366,663)
  at date of recognition as an
  investment
  Value of group's share of net        10,483,858
  assets at the date on which LIM
  ceased to be an associate
  Amount carried in the group                      41,240,859
  accounts
14 b Investments
Value in group financial statements  31 March
while held as an investment:           2013
                                         £
Value of investment upon             10,483,858
recognition as a financial
investment
Addition to investment                  950,927
Loss on adjustment to fair value at (3,791,439)
year end
Exchange difference arising on          321,186
adjustment above
Amount carried in the group           7,964,532
accounts

The published fair value of the group's investment in LIM at 31 March 2013 is £
7.9 million (2012 - £51 million).
The shares included above represent an investment in listed equity securities
that present the group with opportunity for return through dividend income and
trading gains. The group holds a strategic non-controlling interest, following
the dilution of its interest in Labrador Iron Holdings Limited (see note 14a)
to 15.3%. These shares are not held for trading and accordingly are classified
as `available for sale' which is deemed to be the most appropriate
classification under IFRS. The fair values of all equity securities are based
on quoted market prices.
The above investment is measured subsequent to initial recognition at fair
value as `Level 1' AFS based on the degree to which the fair value is
observable. Level 1 fair value measurements are those derived from quoted
priced (unadjusted) in active markets.
Values as shown in the published       31 March     31 March
accounts of the associate (100%)         2013         2012
including a fair value uplift in          £            £
respect of mineral properties, after
conversion into sterling:
  Total assets                        191,199,592  238,839,086
  Total liabilities                  (21,655,917) (29,348,232)
  Total net assets                    169,543,674  209,490,854
                                             2013         2012
  Revenues                             60,573,862            -
  (Loss) for the year                (82,072,824)  (9,285,932)

15 Deposit
                                        Group          Company
                              2013       2012        2013       2012
                                 £          £           £          £
Site re-instatement        122,204    121,685     -          -
deposit
This deposit was required and made under the terms of a Section 106 Agreement
with the Isle of Anglesey County Council which has granted planning permissions
for mining at Parys Mountain. The deposit is refundable upon restoration of the
permitted area to the satisfaction of the Planning Authority. The carrying
value of the deposit approximates to its fair value.
16 Other receivables
                                        Group                 Company
                              2013       2012         2013       2012
                                 £          £            £          £
Other                       40,239     64,991       26,102     24,071

The carrying value of the receivables approximates to their fair value.
17 Cash
                                         Group                 Company
                              2013        2012        2013        2012
                                 £           £           £           £
Held in sterling           646,760   1,092,216     623,215   1,063,330
Held in Canadian dollars    23,585   2,058,428           -           -
                           670,345   3,150,644     623,215   1,063,330

The carrying value of the cash approximates to its fair value.
18 Trade and other payables
                                           Group                 Company
                              2013          2012        2013        2012
                                 £             £           £           £
Trade creditors           (33,860)     (207,331)    (10,700)    (41,021)
Property royalties and           -     (759,680)           -           -
rentals
Taxes                     (13,064)      (30,398)    (13,064)    (30,398)
Other accruals            (53,753)      (43,552)    (46,752)    (35,999)
                         (100,677)   (1,040,961)    (70,516)   (107,418)

The carrying value of the trade and other payables approximates to their fair
value. During the year the amounts due in respect of property royalties and
rentals were discharged - see note 26 (d).
19 Loan
                                            Group                      Company
                               2013          2012           2013          2012
                                  £             £              £             £
Loan from Juno Limited  (2,306,283)   (2,191,260)    (2,306,283)   (2,191,260)

The loan from Juno Limited is provided under a working capital agreement,
denominated in sterling, unsecured and carries interest at 10% per annum on the
principal only. It is repayable from any future financing undertaken by the
company, or on demand following a notice period of 367 days. The terms of the
facility were approved by an independent committee of the board. The carrying
value of the loan approximates to its fair value.
20 Provision
                                 Group                  Company
                              2013        2012        2013       2012
                                 £           £           £          £
Provision for site        (42,000)    (42,000)           -          -
reinstatement
The provision for site reinstatement covers the estimated costs of
reinstatement at the Parys Mountain site of the work done and changes made by
the group up to the date of the accounts. These costs would be payable on
completion of mining activities (which is estimated to be in more than 20
years' time) or on earlier abandonment of the site. There are significant
uncertainties inherent in the assumptions made in estimating the amount of this
provision, which include judgements of changes to the legal and regulatory
framework, magnitude of possible contamination and the timing, extent and costs
of required restoration and rehabilitation activity. There has been no movement
during the year.
21 Share capital
             Ordinary shares of 1p Deferred shares of 4p     Total
Issued and     Nominal      Number   Nominal      Number   Nominal
fully paid     value £               value £               value £
At 31 March  1,581,581 158,158,051 5,510,833 137,770,835 7,092,414
2011
Issued 5         2,500     250,000         -           -     2,500
April 2011
Issued 22        2,000     200,000         -           -     2,000
March 2012
At 31 March  1,586,081 158,608,051 5,510,833 137,770,835 7,096,914
2012
Issued 11       20,000   2,000,000         -           -    20,000
July 2012
At 31 March  1,606,081 160,608,051 5,510,833 137,770,835 7,116,914
2013
The deferred shares are non-voting, have no entitlement to dividends and have
negligible rights to return of capital on a winding up.
The issue of 2,000,000 shares on 24 July 2012 was to Intermine Limited at the
then market price of 12 pence per share for consideration of £240,000 as part
of the discharge of amounts due and cancellation of a royalty agreement - see
note 26 (d).
22 Equity-settled employee benefits
2004 Unapproved share option plan
The group plan provides for a grant price equal to or above the average quoted
market price of the ordinary shares for the three trading days prior to the
date of grant. All options granted to date have carried a performance
criterion, namely that the company's share price performance from the date of
grant must exceed that of the companies in the top quartile of the FTSE 100
index. The vesting period for any options granted since 2004 has been one year.
If the options remain unexercised after a period of 10 years from the date of
grant, they expire. Options are forfeited if the employee leaves employment
with the group before the options vest.
                                        2013                     2012
                         Options    Weighted      Options    Weighted
                                     average                  average
                                    exercise                 exercise
                                    price in                 price in
                                       pence                    pence
Outstanding at        11,550,000       10.90   12,000,000       10.69
beginning of period
Granted during the             -           -            -           -
period
Forfeited during the           -           -            -           -
period
Exercised during the           -           -      450,000        5.24
period
Expired during the             -           -            -           -
period
Outstanding at the    11,550,000       10.90   11,550,000       10.90
end of the period
Exercisable at the    11,550,000       10.90   11,550,000       10.90
end of the period

No options were granted, forfeited or expired during the year or the prior
year. The options outstanding at 31 March 2013 had a weighted average
exercise price of 10.90 pence (2012 - 10.90 pence), and a weighted average
remaining contractual life of 3.0 years (2012 - 4 years). As all options had
vested by 31 March 2010, the group recognised no expenses in respect of
equity-settled employee remuneration in respect of the years ended 31 March
2012 and 2013.
A summary of options granted and outstanding, all of which are over ordinary
shares of 1 pence, is as follows:
Scheme             Number  Nominal Exercise Exercisable Exercisable
                           Value £  price          from       until
2004            5,500,000   55,000  4.13p    22 October  21 October
Unapproved                                         2004        2014
2004            1,550,000   15,500 10.625p   15 January  14 January
Unapproved                                         2007        2016
2004            3,800,000   38,000  21.90p  26 November 26 November
Unapproved                                         2008        2017
2004              700,000    7,000  5.00p      27 March    27 March
Unapproved                                         2010        2019
Total          11,550,000  115,500
23 Results attributable to Anglesey Mining plc
The loss after taxation in the parent company amounted to £492,818 (2012 loss £
495,959). The directors have taken advantage of the exemptions available under
section 408 of the Companies Act 2006 and not presented an income statement for
the company alone.
24 Financial instruments
Capital risk management
There have been no changes during the year in the group's capital risk
management policy.
The group manages its capital to ensure that entities in the group will be able
to continue as going concerns while optimising the debt and equity balance. The
capital structure of the group consists of debt, which includes the borrowings
disclosed in note 19, the cash and cash equivalents and equity comprising
issued capital, reserves and retained earnings.
The group does not enter into derivative or hedging transactions and it is the
group's policy that no trading in financial instruments be undertaken. The main
risks arising from the group's financial instruments are currency risk and
interest rate risk. The board reviews and agrees policies for managing each of
these risks and these are summarised below.
Interest rate risk
The amounts advanced under the Juno loans are at a fixed rate of interest of
10% per annum and as a result the group is not exposed to interest rate
fluctuations. Interest received on cash balances is not material to the group's
operations or results.
The company (Anglesey Mining plc) is exposed to minimal interest rate risks.
Liquidity risk
The group has ensured continuity of funding through a mixture of issues of
shares and the working capital agreement with Juno Limited. The group could
consider sale of shares in the group's investment to provide continued funding.
Trade creditors are payable on normal credit terms which are usually 30 days.
The loans due to Juno carry a notice period of 367 days; in keeping with its
practice since drawdown commenced more than 10 years ago, Juno has indicated
that it has no current intention of demanding repayment and no such notice had
been received by 17 July 2013. However the Juno loan is classified as having a
maturity date between one and two years from the period end date.
Currency risk
The functional currency of the company is pounds sterling. The loan from Juno
Limited is denominated in pounds sterling. As a result, the group has no
currency exposure in respect of this loan.
The investment in LIM is denominated in Canadian dollars and amounts to
C$12,325,025 equivalent to £7,964,532. If the rate of exchange between the
Canadian dollar and sterling were to move against sterling by 10% there would
be a loss to the group of £724,000 and if it were to move in favour of sterling
by a similar amount there would be a gain of £885,000.
At the year end the group held C$36,555 in Canadian dollars, equivalent to £
22,990. If the rate of exchange between the Canadian dollar and sterling were
to move against sterling by 10% there would be a loss to the group of £2,100
and if it were to move in favour of sterling by a similar amount there would be
a gain of £2,600.
Credit risk
The directors consider that the entity has limited exposure to credit risk as
the entity has immaterial receivable balances at the year-end on which a third
party may default on its contractual obligations. The carrying amount of the
group's financial assets represents its maximum exposure to credit risk. Cash
is deposited with BBB or better rated banks.
A table showing the financial instruments of the group and the company is set
out below:
Group
               Available for        Loans &           Other financial
                sale asset        receivables           liabilities
             31 March    31    31 March 31 March   31 March    31 March
               2013     March    2013     2012       2013        2012
                        2012
                     £       £        £         £           £           £
Financial
assets
Investment   7,964,532       -        -         -           -           -
Deposit              -       -  122,204   121,685           -           -
Other                -       -   40,239    64,991           -           -
debtors
Cash and             -       -  670,345 3,150,644           -           -
cash
equivalents
                     -       -
Financial            -       -
liabilities
Trade                -       -        -         -    (33,860)   (207,331)
creditors
Loans due to         -       -        -         - (2,306,283) (2,191,260)
Juno
             7,964,532       -  832,788 3,337,320 (2,340,143) (2,398,591)

Company
                   Loans &          Other financial
                 receivables          liabilities
                31    31 March   31 March    31 March
               March    2012       2013        2012
               2013
                    £         £           £           £
Financial
assets
Other debtors  26,102    24,071           -           -
Cash and cash 623,215 1,063,330           -           -
equivalents
Financial
liabilities
Trade               -         -    (10,700)    (41,021)
creditors
Loans due to        -         - (2,306,283) (2,191,260)
Juno
              649,317 1,087,401 (2,316,983) (2,232,281)

25 Related party transactions
Transactions between Anglesey Mining plc and its subsidiaries are summarised in
note 13.
Juno Limited
Juno Limited (Juno) which is registered in Bermuda holds 36.1% of the company's
issued ordinary share capital. The group has the following agreements with
Juno: (a) a controlling shareholder agreement dated September 1996 and (b) a
consolidated working capital agreement of 12 June 2002. Interest payable to
Juno is shown in note 7 and the balance due to Juno is shown in note 19. There
were no transactions between the group and Juno or its group during the year
other than the accrual of interest due to Juno. Danesh Varma is a director and,
through his family interests, a significant shareholder of Juno.
Key management personnel
All key management personnel are directors and appropriate disclosure with
respect to them is made in the directors' remuneration report. There are no
other contracts of significance in which any director has or had during the
year a material interest.
26 Mineral holdings
Parys
(a) Most of the mineral resources delineated to date are under the western
portion of Parys Mountain, the freehold and minerals of which are owned by the
group. A royalty of 6% of net profits after deduction of capital allowances, as
defined for tax purposes, from production of freehold minerals is payable. The
mining rights over and under this area, and the leasehold area described in (b)
below, are held in the Parys Mountain Mines Limited subsidiary.
(b) Under a lease from Lord Anglesey dated December 2006, the subsidiary Parys
Mountain Land Limited holds the eastern part of Parys Mountain, formerly known
as the Mona Mine. An annual certain rent of £10,000 is payable for the year
beginning 23 March 2012; the base part of this rent increases to £20,000 when
extraction of minerals at Parys Mountain commences; this rental is
index-linked. A royalty of 1.8% of net smelter returns from mineral sales is
also payable. The lease may be terminated at 12 months' notice and otherwise
terminates in 2070.
(c) Under a mining lease from the Crown dated December 1991 there is an annual
lease payment of £5,000. A royalty of 4% of gross sales of gold and silver from
the lease area is also payable. The lease may be terminated at 12 months'
notice and otherwise terminates in 2020.
(d) A royalty agreement with Intermine Limited required annual payments of
C$50,000 (approximately £31,000) until production commences at the Parys
Mountain mine and a royalty of 4% of net profits (as defined after various
deductions) generated from production at the mine. The royalty agreement also
provided an option to cancel the royalty and advance payments.
In July 2012 under an agreement with Intermine Limited a cash payment of
C$1,000,000 (£630,000) was made and 2,000,000 ordinary shares in the company
issued to cancel the royalty in its entirety, release the charge and discharge
the amount due of £759,680 at 31 March 2012.
Lease payments
All the group's leases and the royalty agreement may be terminated with 12
months' notice. If they are not so terminated, the minimum payments due in
respect of the leases and royalty agreement are analysed as follows: within the
year commencing 1 April 2013 - £15,500; between 1 April 2014 and 31 March 2019
- £82,000. Thereafter the payments will continue at proportionate annual rates,
in some cases with increases for inflation, so long as the leases and royalty
agreement are retained or extended.
27 Material non cash transactions
Other than the issue of shares to Intermine (see note 26d) there were no
material non-cash transactions in the year.
28 Commitments
Other than commitments under leases (note 26) there is no capital expenditure
authorised or contracted which is not provided for in these accounts (2012 -
nil).
29 Contingent liabilities
There are no contingent liabilities (2012 - nil).
30 Events after the period end
Since the year end the market value of the group's shareholding in LIM has
fallen below the amount at which it is held in the statement of financial
position - see note 14b.
Otherwise there are no events after the period end to report.


Anglesey Mining plc
Parys Mountain
Amlwch, Anglesey, LL68 9RE
Phone 01407 831275
mail@angleseymining.co.uk
London office Painter's Hall Chambers
8 Little Trinity Lane, London, EC4V 2AN
Phone 020 7653 9881
Labrador Iron - Toronto 220 Bay Street, Suite 700
Toronto, Ontario, M5J 2W4, Canada
Phone +1 647 728 4107
Registrars Capita Registrars
Northern House, Woodsome Park
Fenay Bridge, Huddersfield, HD8 0LA
Phone 0871 664 0300
Calls cost 10p per minute plus network extras
From overseas +44 208 639 3399
Fax 01484 600911
Registered office Tower Bridge House,
St. Katharine's Way, London, E1W 1DD
Web site www.angleseymining.co.uk
Company registered number 1849957
Shares listed The London Stock Exchange - LSE:AYM
                           www.angleseymining.co.uk
                           www.labradorironmines.ca
(Source: PR Newswire )
(Source: Quotemedia)

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