Financial instruments measured at fair value

The following table presents financial assets and liabilities measured at fair value in the statement of financial position in accordance with the fair value hierarchy. This hierarchy groups financial assets and liabilities into three levels based on the significance of inputs used in measuring the fair value of the financial assets and liabilities. The fair value hierarchy has the following levels:

-       Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

-       Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

-       Level 3: inputs for the asset or liability that are not based on observable market data (unobserved inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

The financial assets and liabilities measured at fair value in the statement of financial position are grouped into the fair value hierarchy as follows:

                                                                                                                                               (GROUP)

                                                                                                                                                    (COMPANY)

There have been no significant transfers between levels in the reporting period.

Reconciliation of Level 3 fair value measurements of financial instruments (Group and Company)

Measurement of fair value

The methods and valuation techniques used for the purpose of measuring fair value are outlined in note 1 and remain unchanged compared to the previous reporting period.  The fair values of short-term receivables, cash and short-term payables do not differ from their carrying values due to their short maturity profiles.

Listed / quoted securities

Equity securities held by the Group are denominated in GBP, USD, CAD$, and AUS$ and are publicly traded on the main London Stock Exchange, the Alternative Investment Market of the London Stock Exchange, the Toronto Venture Exchange, the Australian Exchange and on NEX.  Fair values have been determined by reference to their quoted bid prices at the reporting date, with the exception of Rockrose plc, which are currently suspended and have been valued at their last available market price prior to suspension.

8.         TRADE AND OTHER RECEIVABLES

The amounts owed by group undertakings are interest free, unsecured and repayable on demand.

An expected credit loss impact assessment under IFRS 9 is not required, as the group does not hold any trade or intercompany debtors as at the balance sheet date.

9.         DEFERRED TAX LIABILITIES

The Group has tax losses carried forward in respect of excess management charges, non-trade deficits and capital losses of £2,965,014 (2019: £2,525,819). Unrealised losses on the Group's financial assets are estimated at £779,602 (2019: £675,998).  The resulting deferred tax asset is £563,353 (2019: £479,906).  However, deferred tax assets are not recognised due to the unpredictability of future profit streams arising from the disposal of investments held by the Group.  Tax losses may be carried forward indefinitely and will only be recoverable if suitable profits arise in the future. Deferred tax positions arising from unrealised gains and losses on the group's financial assets will vary depending on changes in the fair values of those assets up until the date of disposal

10.       TRADE AND OTHER PAYABLES

11.       CALLED UP SHARE CAPITAL

The share capital of Tiger consists of fully paid ordinary shares with a nominal value of 0.1p each and deferred shares with a nominal value of 0.9p each.  Ordinary shares of 0.1p are eligible to receive dividends and the repayment of capital and represent one vote at the shareholders' meeting of The Company. The deferred shares carry no dividend or voting rights.

The Deferred shares have no income or voting rights.

Included in allotted called and fully paid share capital are 4,500,000 shares with a nominal value of £4,500 held by the company in treasury.

(i) On 12 October 2020, The Company issued 12.5 million shares of 0.1 p each at an issue price of 0.25p each share each to acquire outstanding loans in Metrock totalling £31,250 - for further details refer to note 13(B).

12.       RELATED PARTY TRANSACTIONS

(1)   Lion Mining Finance Limited, a company in which Colin Bird is director and shareholder, has provided administrative and technical services to the Company amounting to £60,000 plus VAT in the year (2019 - £60,000).  There were no amounts outstanding at 31 December 2019 (2019- nil).   The Board considers this transaction to be on an arms' length basis.

(2)   The emoluments of the Directors are disclosed in note 3.

(3)   Directors' shareholdings are disclosed in the Report of the Directors.

(4)   The Company currently holds 50.75% equity stake in African Pioneer Plc ("APP"). C Bird, M H Nolan and R Samtani each also hold shares in APP. On 7 December 2020, APP consolidated its share capital 10:1 for existing shares. This resulted in 1,172,982 total issued number of shares, with The Company holding 595,291 shares at 31 December 2020. See note 6 to the financial statements for further details relating to this investment.

(5)   On 19 August 2015, the Company made an investment of £125,000 in Galileo Resources Plc ("Galileo"), acquiring 10,416,667 Ordinary shares of 0.1 pence each (being a 6.69% stake in Galileo at the date of subscription).  The Company sold 3,900,000 Galileo shares on 3 February 2017 for a total consideration of £161,346 and held 6,516,667 shares in Galileo Resources Plc at 31 December 2020 and 31 December 2019.

(6)   On 4 February 2017, African Pioneer Plc ("APP") sold its brought forward holding of 1,500,000 Ordinary shares in      Galileo Resources Plc realising a profit of £94,285. APP bought a further 2,500,000 Galileo shares for £50,000 in September 2017. Colin Bird is a Director and the Executive Chairman of Galileo and did not participate in the decision-making process for the Galileo investment decisions.

13.       POST-REPORTING DATE EVENTS

AGREEMENTS ENTERED INTO DURING THE PERIOD WHICH HAVE NOT YET CLOSED

A.    Proposed Listing of African Pioneer Plc:

(I) Purchase of Namibian exploration assets

On 29 October 2020, African Pioneer Plc entered into a sale and purchase agreement to acquire a 100 per cent. interest in Zamcu Exploration Pty Ltd ("Zamcu"), which via its subsidiaries Manmar Investments One Hundred & Twenty Nine (Pty) Limited ("Manmar 129") and Manmar Investments One Hundred & Thirty Six (Pty) Limited ("Manmar 136") holds a 70 per cent. interest in two Namibian Prospecting Licenses comprising of EPL 5772 (Ongombo) and EPL 6011 (Ongeama). Both licences are located within the Matchless amphibolite Belt of central Namibia.

These acquisitions are conditional inter alia on the Company's shares being admitted on the Official List by way of a Standard Listing.

The consideration for these acquisitions is to be satisfied by the issue on listing of:

(i)            10,000,000 APP Shares to Zamcu shareholders.

(ii)           A total of approximately 4,742,857 APP Shares to Manmar 129 and Manmar 136 shareholders.

(iii)          Approximately 4,900,000 APP Shares to Avanti Resources Pty Ltd as trustee for the Marlow Family Fund pursuant to an introduction mandate agreement. 

The total consideration for the acquisition of the above Namibian Prospecting Licences including the sum of AUS$ 200,000 which was paid by the company to Manmar 129 and Manmar 136 shareholders on 29 January 2021 and a further amount of AU$64,000 on 9 April 2021 will amount to £835,148, at specified exchange rates, assuming a valuation of 3.5 pence per APP ordinary share on listing.

(II) Purchase of Zambian exploration assets

On 25 November 2020, African Pioneer Plc entered into a sale and purchase agreement to acquire an 80 per cent.  interest in African Pioneer Zambia Limited which holds a 100 per cent. interest in four Zambian Prospecting Licenses (27771 HQ-LEL,

Proposed Listing of African Pioneer Plc (continued):

27770 HQ-LEL, 27768 HQ-LEL and 27767 HQ-LEL) located in the Central African Copperbelt and one Prospecting Licence (27769 HQ-LEL) located in the Zambezi Belt.

The above acquisitions are conditional inter alia on the Company's shares being admitted on the Official List by way of Standard Listing. 

The total consideration for the acquisition of the Zambian Prospecting Licences will be satisfied by the issue of 55,000,000 new APP ordinary shares and will amount to £1,925,000 assuming a price of 3.5 pence per APP ordinary share on listing.

(III) Purchase of Botswana Prospecting Licences

On 29 October 2020 African Pioneer Plc entered into a sale and purchase agreement to acquire a 100 per cent. interest of Resource Capital Partners Pty Ltd which holds a 100 per cent. interest in six Prospecting Licences (PLs 96, 98 and 100, 101, 102 and 103/2020) located in the Kalahari Copperbelt and a further two Prospecting Licences (PLs 97 and 99/2020) located in the Limpopo Mobile Belt in Botswana.

This acquisition is conditional inter alia on the Company's shares being admitted on the Official List by way of Standard Listing.

The total consideration for the acquisition of the Botswanan Prospecting Licences will be satisfied by the issue of 10,000,000 new APP ordinary shares and will amount to £350,000 assuming a price of 3.5 pence per APP ordinary share on listing.

Exclusive Mandate with Metrock Resources Ltd

On 12 October 2020, The Company entered into an exclusive advisory and investment agreement ("Mandate") with Metrock Resources Ltd. ("Metrock") to oversee the listing of a number of mineral exploration licences in Southern Botswana, comprising the Kanye Manganese project ("Kanye").

Under this agreement, the Company agreed to issue 25 million new Ordinary Shares in two tranches of 12.5 million shares to acquire loans outstanding in Metrock totalling £62,500. The Company issued the first tranche of 12.5 million Ordinary shares of 0.1 p each at an issue price of 0.25p per share to acquire outstanding loans in Metrock totalling £31,250 shortly after executing the Mandate with Metrock.  It was agreed that the 2^nd tranche of 12.5M shares would be issued on completion of the IPO of the Manganese assets to acquire a further loan outstanding in Metrock amounting to £31,250.  

The Company and Metrock subsequently agreed not to proceed with an IPO of the Manganese assets and to amend the terms of the Mandate to facilitate the vending of the Kanye Manganese project to AIM quoted Bezant Resource Plc ("Bezant").  As part of the revised terms for the Mandate, the Company received the following on completion of the sale of the Kanye project to Bezant on 12 February 2021.

(i) 28,314,815 Bezant Shares ("New Shares") as settlement of outstanding loans of £46,250 (including the £31,250 of loans acquired through the issue of 12.5M Ordinary Shares referred to above) which The Company had made to Metrock plus a fee of £30,200 fee due from Metrock for facilitating the sale of the sale of the Kanye Manganese project.

(ii)The Company was granted a Net Smelter Return ("NSR") of 2% on the Kanye project which may be purchased from the Company by Metrock for a payment of £1 million or on a partial basis at a buy-out rate of £250k per 0.5% of the NSR.

As part of the revised terms agreed in the amended Mandate, it was agreed that The Company would no longer participate in a 2^nd tranche investment of £31,250 in outstanding Metrock loans.

AGREEMENTS ENTERED INTO POST PERIOD END WHICH HAVE NOT YET CLOSED

B.    Conditional sale of Botswana Prospecting Licences

On 12 March 2021 African Pioneer Plc entered into a conditional licence sale agreement with Australian Stock exchange listed Sandfire (the "Conditional Botswana Licence Sale Agreement") which provides for the following:

a)    The Sale of licences: the sale to Sandfire of the 8 Botswana licences (the "Botswana Licences") being acquired at Standard Listing by the acquisition of Resources Capital Partners (Pty) Limited for an aggregate consideration of US$1M (being a Guarantee Fee of US$250,000 and a Licence Purchase Price of US$750,000) of which US$0.5M will be paid in cash (the "Cash Consideration") and US$0.5M by the issue by Sandfire of its ordinary shares to APP (the "Consideration Shares") at an issue price per share based on the 10 day volume weighted average price (VWAP) of the Sandfire share price as at the date before the signing of the Sandfire Conditional Botswana Licence Sale Agreement;

b)    An Exploration Commitment: Sandfire to spend US$1M on the Licences (the "Exploration Commitment") within two years of settlement (the "Exploration Period") and if the US$1M is not spent any shortfall will be paid to African Pioneer;

c)     A Success Payment: a success payment to be paid to APP for the first ore reserve reported under The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC) 2012 edition on the Licences which exceeds 200,000 tonnes of contained copper (the "First Ore Reserve") in the range of US$10M to US$80M depending on the copper ore in the First Ore Reserve (the "Success Payment"). Sandfire have the option to elect to settle the Success Payment, if due, by the issue of Sandfire shares based on the 10-day Volume Weighted Average Price (VWAP) of Sandfire shares at the time of announcing an Ore Reserve that triggers the Success Payment. Given the limited exploration conducted on the Botswana licenses to date and the many years that it could take to establish and ore reserve that there can be no guarantee that any such Success Payment will be forthcoming;

d)    Conditions Precedents: The conditions precedent to be completed unless indicated otherwise by the long stop date of 31 July 2021 are as follows:

i)      The parties having executed the Convertible Loan Note Share Subscription Agreement as detailed in (D) below;

ii)     The Company providing, at least 5 Business Days prior to the Settlement Date:

(1)   ministerial consent for the transfer of the Licences;

(2)   all ASX and LSE regulatory approvals;

(3)   bank details for the payment of the Licence Purchase Price and the Guarantee Fee;

(4)   approval of the acquisition of the Licences by the Competition Authority of Botswana (or confirmation from such authority or from either party's Botswana legal counsel that such approval is not required); and

(5)   duly executed transfer applications for the Licences in the form required by the Mining Act or the Department under which a 100% interest in the Licences may be transferred to the Purchaser.

iii)    the Standard Listing having occurred by 30 June 2021. If Standard Listing has not occurred by 30 June 2021 then the initial long stop date of 31 July 2021 shall automatically be extended to 31 December 2021 (the "Long Stop Date") and the Cash Consideration shall not be payable.

e)     Completion and Standard Listing not occurring by Long Stop Date. If both I) completion of the Conditional Botswana Licence Sale Agreement and ii) Standard Listing have not occurred, by the Long Stop Date then APP will be due to pay Sandfire US$500,000 by way of a cancellation fee.

Rationale for Conditional Botswana Licence Sale Agreement: APP has seen this as an opportunity for Sandfire to take over ownership and responsibility for the exploration stage of the Botswanan Projects whilst allowing APP to share in the potential upside should the exploration ultimately be successful in establishing a mineable reserve.  Sandfire has the in-country infrastructure and technical expertise and financial resources to accelerate the rate of expenditure on the Botswanan assets.

AGREEMENTS ENTERED INTO POST PERIOD END WHICH HAVE NOT YET CLOSED

C.    US$500,000 Investment by Sandfire Resources Limited into African Pioneer Plc

On 11 March 2021, African Pioneer Plc entered into a Convertible Loan Note Share Subscription Agreement (the "Sandfire Investment Agreement") with Sandfire. Following this agreement Sandfire has now subscribed for US$500,000 interest free unsecured loan notes ("Sandfire Investment Notes") which will automatically be convertible upon Standard Listing into APP ordinary shares constituting 15% of the Company's enlarged share capital. 

Pursuant to the Sandfire Investment Agreement, upon conversion, Sandfire has the right to nominate a director to the Board of the Company whilst their shareholding remains at or above 15% of the issued share capital of African Pioneer.  If the Standard Listing has not occurred by 30 June 2021, then the Sandfire Investment Notes will be automatically and immediately cancelled and the US$500,000 invested by Sandfire will not be repayable by the Company

Additionally, Sandfire will have the right to participate in all future share offerings by African Pioneer as subscribers so as to maintain its African Pioneer shareholding at 15%, irrespective of any disapplication or non-application of pre-emption rights. The African Pioneer Shares issued to Sandfire at Standard Listing will be subject to a 12-month lock-in during which the African Pioneer ordinary shares are not permitted to be sold, followed by a 12-month orderly markets period during which Sandfire are required to work with the African Pioneer's broker for 10 days prior to making any sale.

14.       CONTINGENT LIABILITIES

There were no contingent liabilities at 31 December 2020 (2019 - None).

There were no operating or financial commitments or contracts for capital expenditure in place for the Group or Company as at the reporting date (2019: £nil).

15.       FINANCIAL INSTRUMENTS

Management of Risk

The Group and the Company's financial instruments comprise:

§ Investments in subsidiary companies

§ Investments held at fair value through profit or loss

§ Cash, short-term receivables and payables

Throughout the period under review, it was the Group's policy that no trading in derivatives shall be undertaken.

The main financial risks arising from the Group and Company's financial instruments are market price risk and liquidity risk.

Liquidity risk arises principally from cash and cash equivalents, which comprise cash at bank (repayable on demand). The Group has no overdraft facilities. The carrying amount of these assets are approximately equal to their fair value.

Credit risk is not significant, but is monitored.  The Board regularly reviews and agrees policies for managing each of these risks and they are summarised below. These policies have remained constant throughout the period.

Market risk

Market risk consists of interest rate risk, foreign currency risk and other price risk.  It is the Board's policy to maintain an appropriate spread of investments in the portfolio whilst maintaining the investment policy and aims of the Company and the Group.  The Investment Committee actively monitors market prices and other relevant information throughout the year and reports to the Board, who is ultimately responsible for the Group's investment policy.

Interest rate risk

Changes in interest rates would affect the Company and the Group's returns from its cash balances. A floating rate of interest, which is linked to bank base rates, is earned on cash deposits. The exposure to cash flow interest rate risk at 31 December 2020 for

the Group was £508,161 (2019: £142,622).   The exposure to cash flow interest rate risk at 31 December 2020 for the Company was £420,699 (2019: £142,394).

A sensitivity analysis based on a movement of 1% on interest rates would have a £5,079 effect on the Group's profit (2019: £1,426).  A sensitivity analysis based on a movement of 1% on interest rates would have a £4,207 effect on the Company's' profit (2019: £1,424).

As the Group does not have any borrowings and finances its operations through its share capital and retained revenues, it does not have any interest rate risk except in relation to cash balances.

Foreign currency risk

The Group's total return and net assets can be affected by currency translation movements as part of the investments held by the Company are denominated in currencies other than £ Sterling. The Directors mitigate the individual currency risks through the international spread of investments. Hedging transactions may be used but none have been employed during the period under review (2019: none).

The fair values of the Group's investments that have foreign currency exposure at 31 December 2020 are shown below.

The Group accounts for movements in fair value of its financial assets in other comprehensive income. The following table illustrates the sensitivity of the equity in regard to the Group's financial assets and the exchange rates for £/ Canadian Dollar, £/ US Dollar and £/Australian Dollar.

It assumes the following changes in exchanges rates:

- £/CAD                    +/- 20% - (2019: +/- 20%)

- £/USD                     +/- 20% - (2019: +/- 20%)

- £/AUD                    +/- 20% - (2019: +/- 20%)

These percentages used reflect the high level of market volatility experienced in exchange rates in recent years.

The sensitivity analysis is based on the Group's foreign currency financial instruments held at each balance sheet date.

If £ Sterling had weakened against the currencies shown, this would have had the following effect:

If £ Sterling had strengthened against the currencies shows, this would have had the following effect:

If £ Sterling had weakened against the currencies shown, this would have had the following effect:

If £ Sterling had strengthened against the currencies shows, this would have had the following effect:

Other price risk

Other price risk which comprises changes in market prices other than those arising from interest rate risk or currency risk may affect the value of quoted and unquoted equity investments. The Board of directors manages the market price risks inherent in the investment portfolio by regularly monitoring price movements and other relevant market information.

The Group accounts for movements in the fair value of investments in financial assets in other comprehensive income and assets designated at fair value through profit or loss in comprehensive income. The following table illustrates the sensitivity to equity of an increase / decrease of 50% in market prices. This level of change is considered to be reasonable based on observation of current market conditions, in particular resource stocks and junior mining companies. The sensitivity is based on the Group's equities at each balance sheet date, with all other variables held constant.

Liquidity risk

The Group maintains appropriate cash reserves and the majority of the Group's assets comprise realisable securities, most of which can be sold to meet funding requirements if necessary. Given the Group's cash reserves, it has been able to settle all liabilities on average within 1 month.

Credit risk

The risk of counterparty's failure to discharge its obligations under a transaction that could result in the Group suffering a loss is minimal. The Group holds its cash balances with a reputable bank and only transacts with regulated institutions on normal market terms. 

Included in total amounts receivable at 31 December 2020 is the sum of £859 (2019 - £2,313) which was lodged with the Company's brokers in relation to future investments.     

Financial liabilities

There are no currency or interest rate risk exposures on financial liabilities as they are denominated in £ Sterling and settled on average within one month.

Capital management

The Group actively reviews its issued share capital and reserves and manages its capital requirements in order to maintain an efficient overall financing structure whilst avoiding any leverage. The capital structure of the Group and the Company consists of only equity of the Group (comprising issued capital, reserves, retained earnings and non- controlling interests as disclosed below and in the Consolidated Statements of Changes in Equity & Statement of Changes in Equity) and no debt.

The Board monitors the discount level of its issued shares, which is the difference between its Net Asset Value (NAV) and its actual share price. To improve NAV, the Company may purchase its own shares in the market. During the current year, the Group has not purchased any of its own shares (2019: Nil).