EUROPEAN LITHIUM LIMITED EUROPEAN LITHIUM LIMITED
ABN 45 141 450 624
Interim Financial Report
For the Half Year Ended
31 December 2021
CONTENTS
AUDITOR'S INDEPENDENCE DECLARATION ................................................................................................................................................. | 8 |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ................................................................................................. | 9 |
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION ........................................................................................................ | 10 |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ......................................................................................................... | 11 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS..................................................................................................................... | 12 |
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.................................................................................................... | 13 |
DIRECTORS' DECLARATION ........................................................................................................................................................................ | 22 |
INDEPENDENT AUDITOR'S REVIEW REPORT .............................................................................................................................................. | 23 |
HALF YEAR REPORT DECEMBER 2021 | Page 1 |
DIRECTORS' REPORT
DIRECTORS' REPORT
Your Directors submit the Interim Financial Report of European Lithium Limited (European Lithium or the Company) and its controlled entities (together the Group) for the half-year ended 31 December 2021. In order to comply with the provisions of the Corporations Act
2001, the Directors report as follows:
Directors
The names of Directors who held office during or since the end of the interim period and until the date of this report are noted below. Directors were in office for the entire period unless otherwise stated.
Antony Sage | Executive Chairman |
Malcolm Day | Non-Executive Director |
Michael Carter | Non-Executive Director (appointed 31 August 2021) |
Mykhailo Zhernov | Non-Executive Director (appointed 22 December 2021) |
Kimon Gkomozias | Executive Director (resigned 31 August 2021) |
Review of Operations
Corporate
Millstone Acquisition and Placement
On 4 November 2021, the Company announced that it has entered into binding agreements under which EUR will acquire Petro Consulting LLC (Petro Consulting), a Ukraine incorporated company that is applying (through either court proceedings, public auction and/or production sharing agreement with the Ukraine Government) for 20-year special permits for the extraction and production of lithium at the Shevchenkivske project and Dobra Project in Ukraine, from Millstone and Company Global DW LLC (Millstone). In addition, under the terms of the agreement, Millstone will subscribe for $20m in shares in the Company, with $2.5m invested immediately, $2.5m subject to shareholder approval (approval received at the AGM held on 21 January 2022) and the balance of $15m following completion of the acquisition of Petro Consulting.
Board Changes
During the half year ended 31 December 2021, the Company announced the appointment of Mr Michael Carter as Non-Executive Director and the resignation of Mr Kimon Gkomozias as Executive Director of the Company with effect from 31 August 2021.
On 22 December 2021, the Company announced the appointment of Mr Mykhailo Zhernov as Non-Executive Director of the Company. Mr Mykhailo Zhernov's appointment was in accordance with the terms of the Millstone transaction.
During the half year ended 31 December 2021, as a result of EUR's advancement of the Wolfsberg Lithium Project and increased levels of activities, Tony Sage transitioned to Executive Chairman.
Placement
During the half year ended 31 December 2021, the Company issued 141,000,000 shares at an issue price of $0.0625 per share with a 1 for 1 free attaching listed option (exercisable at $0.075 on or before 19 April 2024) to raise proceeds of $6.50m (before expenses) (August Placement)
Financing Facility - Winance
The Company previously announced that it had secured a A$10 million finance facility with Winance Investment LLC (Winance) (refer ASX Announcement 31 July 2019). On 5 March 2020, the Company announced that it had agreed to draw down A$2 million (2,000 convertible notes) under the Winance facility (Tranche 2).
HALF YEAR REPORT DECEMBER 2021 | Page 2 |
DIRECTORS' REPORT
During the half year ended 31 December 2021, Winance converted the remaining 300 Tranche 2 notes. As at 31 December 2021, Winance had nil Tranche 2 convertible notes remaining.
OTC
On 23 November 2021, the Company announced that its shares are now quotes on the US OTCQB market under the symbol EULIF.
OTC Markets Group Inc. (OTCQX: OTCM) operates the OTCQX® Best Market, the OTCQB® Venture Market, and the Pink® Open Market for 11,000 U.S. and global securities. The OTC Markets Group provide an SEC regulated Alternative Trading System, OTC Link® ATS, that connects a diverse network of broker-dealers to provide liquidity and execution services for the OTC markets, therefore, enabling investors to easily trade through the broker of their choice and empower companies to improve the quality of information available for investors. OTC Markets Group Market Data is distributed by most major financial data distributors, including Bloomberg, Thomson Reuters, Interactive Data, Factset, Fidessa, NASDAQ and SIX Financial.
Capital Raisings and Movements
On 16 August 2021, the Company issued 104,000,000 shares and 52,000,000 listed options $0.075 each expiring 19 April 2024) pursuant to the August Placement. On the same day, Evolution was issued 2,000,000 shares and 20,000,000 listed options ($0.075 each expiring 19 April 2024) as lead managers for the August Placement. In addition, the Company issued 200,000 shares in satisfaction of debts of $12,000 owed by the Company to unrelated third parties.
On 23 August 2021, the Company issued 6,000,000 shares to Winance upon the conversion of 300 convertible notes.
On 17 September 2021, the Company issued 150,000 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022).
On 30 September 2021, the Company issued 4,000,000 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022).
On 5 October 2021, the Company issued 3,400,000 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022).
On 20 October 2021, the Company issued 7,500,000 shares upon the exercise of listed options ($0.075 each expiring 19 April 2024).
On 5 November 2021, the Company issued 4,043,688 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022).
On 12 November 2021, the Company issued 1,713,335 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022) and issued 8,528,035 shares upon the exercise of listed options ($0.075 each expiring 19 April 2024).
On 25 November 2021, the Company issued 3,634,426 shares upon the exercise of unlisted options ($0.05 each expiring 31 July 2022) and issue of 1,370,000 shares upon the exercise of listed options ($0.075 each expiring 19 April 2024).
On 30 November 2021, a total of 10,000,000 unlisted options expired ($0.15 each).
On 11 December 2021, a total of 2,500,000 unlisted options expired ($0.20 each).
On 22 December 2021, the Company issued 26,310,749 shares in respect to tranche 1 of the subscription agreement pursuant to the Millstone transaction.
Wolfsberg Lithium Project - Austria
Drilling
Two drill rigs mobilised Q1 & Q2/2021 were demobilised in Q3 after the successful completion of the deep hole drilling program. Both drill rigs completed the ambitious drilling program for deep holes (>300m in depth) totalling 7,923m during Q3/2021. The drilling contractor delivered the high-quality work with an extraordinary core recovery and remaining incident free.
HALF YEAR REPORT DECEMBER 2021 | Page 3 |
DIRECTORS' REPORT
Figure 1: Drill Rig I - in operation
Total Measured, Indicated and Inferred Mineral Resources now total 12.9 Mt grading 1.00% Li2O. This includes the previously announced estimate of 9.7Mt grading 1.03% Li2O in the Measured and Indicated Resource category (see ASX Announcement, 8 November 2021) and the updated Inferred Resource estimate of 3.1 Mt grading 0.90% Li2O.
Category | Tonnage (t) | Grade (% Li2O) |
Measured | 4 313 000 | 1,13 |
Indicated | 5 430 000 | 0,95 |
Total (M+I) | 9 743 000 | 1,03 |
Inferred | 3 138 000 | 0,90 |
Total (M+I+In) | 12 881 000 | 1.00 |
Notes:
- resources estimated based on minimum mineralized intersection of 0.5m
- bulk density of 2.73 t/m3 applied to volumetric estimate
- Grade is based on length weighted mineralized intersections, assuming minimum intersection width of 2m and incorporates internal dilution.
Definitive-Feasibility Study (DFS)
The Company completed the resource upgrade to 12.9Mt grading 1.00% Li2O in Zone 1 that is an essential part of the DFS. The final results were signed off by the Company's competent person and published (see ASX Announcement, 1 December 2021).
Dorfner/Anzaplan (Dorfner) based in Germany, as the Company's independent consultants, completed the final locked cycle test as part of the QA/QC process for the metallurgical test work to assess and optimise process lines, flowsheets and layouts. In total there were 4 LCTs required to achieve full confidence in the chemical process lines developed. The comprehensive report provided by Dorfner covers the final results as expected.
HALF YEAR REPORT DECEMBER 2021 | Page 4 |
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European Lithium Limited published this content on 16 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 February 2022 04:13:07 UTC.
