Lionsgold (LSE: LION), the gold company focused on the exploration, production and retail application of physical gold, including the development of physical gold as a currency, is pleased to announce its audited final results for the financial year ended 30 June 2018.
The Company’s annual general meeting (“AGM”) is to be held at the registered office in Guerney at midday on Friday 28 December 2018. Lionsgold is also holding a shareholders presentation event in central London on Wednesday afternoon 19 December – for further details, shareholders should email the company: [email protected]
Chief Executive Officer’s Report
I am pleased to report to Lionsgold Shareholders on the financial year to 30 June 2018. This was a transformational period for Lionsgold in both direction and value growth under its corporate strategy – implemented following the appointment in July 2016 of the executive management – to become a vertically integrated operating company involved in the exploration, production and retail application of physical gold. During the term, Lionsgold increased its financial support and equity holdings in both its Indian and Finnish gold exploration and mining ventures, as well as escalating the development and ownership of its financial technology assets, including a cornerstone investment in the Company’s banking and compliance platform technology provider.
Lionsgold started the financial year with 254,211,719 shares in issue trading at 1.1p each representing a market capitalisation of £2.8 million. The Company finished the financial year with 512,459,296 shares in issue with a price per share of 2.65p (upon trading being suspended in May 2018) representing a market capitalisation of £13.6 million.
During the year the Company’s share price ranged from a low of circa 0.75p to a high of 6.55p. Lionsgold undertook a placing on 30 November 2017 resulting in the issue of 100,250,000 new ordinary shares at a price of 0.8p per share raising gross proceeds of £802,000. The Company has also seen 109,002,273 warrants exercised for new ordinary shares at 1.2p, 1.5p, 2.2p and 3.2p for a total of £1,466,800. The Company also issued during the year 57,995,304 new ordinary shares to acquire the remaining 45% of its fintech subsidiary and issued 5,500,000 in share-based payments of consultancy fees.
Prior to the end of the period under review, on 11 May 2018, Lionsgold had its shares suspended from trading on the London Stock Exchange AIM Market (“AIM”). The suspension was applied under Rule 14 of the AIM Rules for companies (“Rule 14”) on the basis that it had been determined by the regulator that the Company had undertaken a fundamental change of business through the completion of the 100% acquisition of TRAC Technology Limited (since renamed TallyMoney Ltd).
Since that time and post year end, Lionsgold has transitioned from an exploration and mining company with a complementary financial technology (“fintech”) division, to a fintech company with complementary mining assets. The Company has developed its physical gold currency proposition into a 100% reserve banking platform combined with a hard currency, that can operate seamlessly with and complementary to, government issued fiat currency and the fractional reserve banking system. This work has culminated in the branding of the gold currency and banking platform as “Tally” (www.tallymoney.com) as announced on 9 November 2018. Concurrent to this work, Lionsgold has continued to support the development of its gold assets in India and Finland, and in line with the evolution of TallyTM, the Company has been working with its advisers to enable the public access to the equity of the Company as a publicly traded stock once more.
Milestones achieved during the year ending 30 June 2018 and up to the date of this report include:
· Increasing Lionsgold’s equity holding in its fintech subsidiary from 37.7% at the start of the financial year to 55% in July 2017 and then 100% in April 2018;
· Evolving its challenger currency proposition initially named “Goldbloc” into a 100% reserve banking platform and hard currency, branded “Tally”;
· Acquiring 12.5% ownership of Railsbank Technology Ltd (“Railsbank”) – the developer of the banking and compliance technology platform utilised to provide individual bank accounts with Mastercard debit cards denominated in TallyTM, and securing the exclusive right to Railsbank’s API (Application Program Interface) for physical gold and gold derivatives, to 2021.
· Increasing investment in leading Indian gold exploration company Geomysore Services India Pvt Ltd (“Geomysore”) thus increasing Lionsgold’s equity holding from 21.25% to 21.92%;
· Following conclusion of the economic feasibility study with a ‘decision to mine’ at the Jonnagiri Mine Project “Jonnagiri”, the Geomysore team, having negotiated with some 600 landowners, completed lease arrangements and payments on approximately 1,300 acres of the Mining Lease (“ML”) area with circa 150 acres to conclude, and received consent letters for the purchase of over 227 acres of the mine build area at commercially acceptable prices, with 90 acres left to secure;
· Increasing ownership of Lionsgold’s Finnish joint venture company, Kalevala Gold Oy (“Kalevala”) from an initial 15% through 28% to being approximately 32%;
· Kalevala adding to its prospecting licence portfolio by 278km2 and 1,214km2 to now hold some 1,500km2 of gold prospective ground in Finland under licence which sees Kalevala control circa 90% of the known outcrop of the Suomussalmi Greenstone Belt and significant coverage of the Kuhmo Greenstone Belt; and
· Adding highly esteemed personnel including Mr Alan Davies as Global Strategy Consultant – the former Chief Executive of Energy & Minerals at Rio Tinto PLC and former Non-Executive Director of Rolls Royce Holdings PLC with more than twenty years of experience in operational and strategic development in the global mining industry, including having had executive responsibility for Rio Tinto in India for over eight years; and Mr Michael Joseph as Non-Executive Director – a successful entrepreneur with the proven knowledge and ability to rapidly grow a customer facing business in the financial services sector with a proprietary core technology and the Founder/Managing Director of Right Choice Insurance Brokers Ltd which recently received investment of £28 million from Lloyds Bank private equity division at a valuation of over £100 million.
Review of operations for the financial year ended 30 June 2018
The three business divisions of the Company – India Gold, Finland Gold and Fintech Gold – were carried out through the Group’s activities and interests in Geomysore Services India Pvt Ltd, Finnish JV company, Kalevala Gold Oy, and the UK incorporated TRAC Technology Limited (renamed TallyMoney Ltd on (9 November 2018). During the financial year Lionsgold also acquired a strategic 12.5% stake in Railsbank Technology Limited – the developer of the banking and compliance API that is utilised to provide individual banking accounts denominated in TallyTM.
Snapshot of the platform and currency:
· TallyTM gives people the choice to use money that accesses a 100%-reserve banking platform combined with a hard currency.
· Each TallyTM is a milligram of gold directly owned by the customer and utilised in their individual banking account and debit card.
· TallyTM is not a fiat (government-issued) currency and TallyTM is not a cryptocurrency. TallyTM is a tangible asset utilised seamlessly via a customer’s banking account and debit card that operates complementary to fiat currencies using the mainstream banking system.
· TallyMoney Ltd, to be the EMD (Electronic Money Directive) Agent on the Financial Conduct Authority register under the E-Money Licence held by PayrNet Ltd.
Lionsgold owns 100% of TallyMoney Ltd as at 30 June 2018. The Company, acquired the remaining balance of 45% at a pre-money valuation of £3 million in April 2018 and significant development has been undertaken since that time to evolve the product offering and scalability, to maximise the Company’s long-term commercial opportunity.
As TallyMoney Ltd is 100% owned at the year end, it is considered to be controlled and has been consolidated. The total investment in Lionsgold’s individual company balance sheet is shown below. This shows a total investment in TallyMoney of £1.66m in the various stages of acquisition.
Extract from the Parent Company balance sheet as at 30 June
Developed under the initial product name of “Goldbloc”, over the course of calendar year 2018, with live testing underway, the vision and potential application evolved as a physical gold currency and alternative banking platform that operates complementary to fiat currency denominated banking accounts. In reviewing the initial name and the need for the brand positioning to reflect the expanded scope and scalability of the platform and B2B2C product offering and business model, the currency and platform to be released will be known as “Tally”.
Directors of TallyMoney Ltd
The co-founders of the product and platform, Lionsgold’s CEO Cameron Parry together with the Company’s Chief Platform Officer Ralph Hazell, were the only directors of Lionsgold’s fintech subsidiary during the financial period and they continue to be the only two directors of TallyMoney Ltd as at the date of this report.
Cameron Parry (aged 44)
Mr Parry is a serial innovator and chief executive of quoted public companies in both the fintech and mining sectors. Further information about Mr Parry can be found on page 13 of this report in the Board of Directors section.
Ralph Hazell (aged 47)
Mr Hazell is the founder of The Real Asset Company – an online retail gold and silver exchange created to improve access to those precious metals markets and enable individuals to conveniently trade and hold gold and silver. He was previously a trader and market maker in the fixed income and commodity markets for over 10 years, and was a founding partner of Trafalgar Financial Futures in Gibraltar, and of Jebel Tariq Trading in Dubai, which was the first company to automate market making in gold futures on the DGCX (Dubai Gold and Commodities exchange). In 2007, he left the markets to pursue his interest in retail driven marketplaces and exchanges. Whilst building a range of technology platforms, Mr Hazell founded MoneySwap, a P2P currency exchange, which listed on AIM in 2011. Mr Hazell is also the author of “The Decentralised Renaissance”.
Money is omnipresent in our daily lives. Congruent with the real physical asset currency being delivered for public use, “Tally” was developed as a brand name as it is a real word that is both a noun and a verb that refers to a unit, a ledger, a measurement of account and the action to count up, to correspond and to agree. It is still used in the modern vernacular and can be used in the singular or plural form, as a unit of one, or many. Following much deliberation and research over many months around multiple names and visual identities with a leading London brand strategy agency, management determined “Tally” to be a fitting and appealing brand to serve as both the name of the unit of currency and the name of the platform.
The TallyTM platform is due to go live with a soft launch in the UK commencing Q1 2019 with targeted marketing increasing from March 2019, providing the public with the choice to deposit, spend and transact TallyTM as part of and with the ease of everyday banking.
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