Contents
STRATEGIC REPORT
2 Chairman’s Statement
4 Principal activity, strategy & business model
5 Mining Review
7 Sustainable development
11 Principal risks &uncertainties
16 Financial & performance review
GOVERNANCE
23 Directors and advisors
24 Five year summary
24 Financial calendar
25 Directors’ report
31 Statement of the Chairman oftheremuneration committee
32 Annual remuneration report
40 Audit committee report
42 Valuers’ certificates
43 Directors’ responsibilities statement
44 Independent auditor’s report
FINANCIAL STATEMENTS
54 Consolidated income statement
55 Consolidated statement ofother comprehensiveincome
56 Consolidated balance sheet
58 Consolidated statement of changes inshareholders’ equity
59 Consolidated cash flow statement
60 Group accounting policies
68 Notes to the financial statements
94 Company balance sheet
95 Company statement of changes in equity
96 Company accounting policies
11Bisichi PLC
Strategic report
The Directors present the
Strategic Report of the company
for the year ending 31 December
2021. The aim of the Strategic
Report is to provide shareholders
with the ability to assess how the
Directors have performed their
duty to promote the success of
the company for the collective
benefit of shareholders.
2 Bisichi PLC
Strategic Report
As we reflect back on the last two years,
the most challenging priority for your
Company was the continuity of our
South African mining and processing
operations, particularly during the peak
of the Covid-19 pandemic. In early 2020,
when global coal demand fell, the
average weekly price of Free on Board
(FOB) coal from Richards Bay Coal
Terminal (API4 price) fell from a high
of US$92 in January 2020 to $44 in
mid-April 2020. Thereafter, prices
remained largely supressed until the end
of the year. Under these very difficult
circumstances, your management worked
tirelessly, along with our key stakeholders,
to ensure that our South African
operations continued operating in an
efficient manner until global economic
activity and our markets improved.
As 2021 unfolded, an improvement in
global economic activity had a significant
impact on demand for coal in the
international market, alleviating many
of the challenges our South African
operations faced in 2020. Strong demand
for coal in the seaborne market resulted
in significantly higher API4 prices,
particularly in the second half of the year
when the price peaked at over $245 in
October. Overall, the API4 price averaged
$125 in 2021 compared to $65 in 2020.
Despite constraints in transporting
coal for export on the South African rail
network, constraints which were largely
beyond our control, at Sisonke Coal
Processing (our South African coal
processing operation), we were able
to take advantage of the improved
international coal price by increasing our
export sales during the year to 320,000
metric tonnes (2020: 230,000 metric
tonnes). The overall increase in Group
revenue, operating costs and earnings
during the year is mainly attributable
to our coal processing operations.
The overall performance of our South
African operations would have been even
better if we had not encountered some
difficult mining conditions at Black Wattle,
our South African mining operation,
which impacted adversely our coal
production during the period. Overall,
the mine achieved production of
1.04million metric tonnes compared to
1.18million metric tonnes in 2020.
During the year we continued to work
closely with Vunani Mining, our BEE
partner in Black Wattle, to seek further
opportunities to extend the life of mine at
Black Wattle. At the end of last year,
Black Wattle signed an agreement to
acquire an additional coal reserve
contiguous to Black Wattle which
required further drilling to ascertain its
commercial viability and indicative size.
We are very pleased to report that the
recently concluded geological assessment
indicates an expected run of mine tonnage
of 6.1million metric tonnes. This reserve
will be mined by opencast methods, the
coal will be processed at Sisonke Coal
Processing, and then sold into our
existing markets. This new reserve, which
is subject to regulatory approval, will
extend Black Wattle’s life of mine to eight
years. Vunani Mining played a key role in
acquiring these reserves, and will share
equally in any distributable income as
part of their non-controlling interest in
Black Wattle. Further details of this
acquisition can be found in our Mining
and Financial and Performance Reviews.
Looking forward, we expect the Group’s
mining production to improve further
once we complete our transition into new
mining areas at Black Wattle in the first
half of 2022. In addition, we have seen
coal market conditions continue to
improve in 2022 to date. In the first
quarter of this year, the weekly API4 price
averaged $238 and exports from our
South African operations in the first
quarter of 2022 have been in line with the
average export tonnages we achieved in
2021. However, looking beyond the first
Chairman’s Statement
In the wake of the challenges arising from the Covid-19 pandemic, I am pleased to
report to shareholders that for the year ended 31 December 2021, your company
made a profit before interest, tax, depreciation and amortisation (EBITDA) of
£5.8million (2020: loss: £2.4 million) and an operating profit before depreciation,
fair value adjustments and exchange movements (Adjusted EBITDA) of £5.0million
(2020: loss: £1.1million). £4.3million in adjusted EBITDA is attributable to the
second half of the year.
Strategic Report
33
33Bisichi PLC
Strategic Report
quarter, uncertainties remain, particularly
with regard to the international coal
price and the impact of constraints in
transporting coal for export on the South
African rail network.
In the UK, despite the Covid-19 pandemic,
we have seen rental revenue from our
retail property portfolio remain stable in
2021. Overall, the Group billed revenue
from our directly owned property portfolio
of £1.12million (2020: £1.18million) during
the year. The Group continues to hold its
joint venture investment, with London &
Associated Properties PLC and Metroprop
Real Estate Ltd, in the freehold of a retail
and residential redevelopment in West
Ealing, London. As previously announced,
planning permission for an expanded
residential redevelopment of 56 flats
on the site has been received. Planning
approval documents for the planning
consent are currently being finalised and
we look forward to updating shareholders
further on the situation in due course.
Finally, in light of the strong results
achieved for the year and in 2022 to
date, your directors believe the company
has the financial strength to recommence
distribution of dividends to shareholders.
For the year ended 31 December 2021
the directors recommend a dividend of
4p (2020: Nil) per share and a special
dividend of 2p (2020: Nil) per share. The
dividends will be payable on Friday 29
July 2022 to shareholders registered at
the close of business on 8 July 2022.
On behalf of the Board and shareholders,
I would like to thank all of our staff for
their hard work and dedication during
the course of a difficult year.
Sir Michael Heller
Chairman
13 April 2022
4 Bisichi PLC
Strategic Report
Principal activity, strategy
& business model
sustainable value to all our stakeholders through our business model which can be
broken down into three key areas:
1 2 3
Acquisition &
investment
Production &
sustainability
Processing &
marketing
The Group actively seeks new
opportunities to extend the life of its
existing mining and processing
operations in South Africa. The
Group aims to achieve this through
new commercial arrangements and
the acquisition of additional coal
reserves nearby to our existing
mining operations.
In addition, we seek to balance the
high risk of our mining operations
with a dependable cash flow from our
UK property investment operations
and listed equity investment
portfolios. The company primarily
invests in retail property across the
UK as well as residential property
development. The UK Retail property
portfolio is managed by London &
Associated Properties PLC whose
responsibility is to actively manage
the portfolio to improve rental income
and thus enhance the value of the
portfolio over time.
The Group strives to mine its
South African coal reserves in
an economical and sustainable
manner that delivers long term
value to all our stakeholders.
The Group seeks to achieve
value from its South African coal
processing infrastructure through
the washing, transportation and
marketing of coal into both the
domestic and export markets.
55Bisichi PLC
Strategic Report
Mining review
We are pleased to report that, after a challenging 2020, higher prices for our coal have
accelerated the recovery of our South African operations in 2021. Although we continued
to manage the health and safety impact of the Covid-19 pandemic on the Group’s
mining and processing operations in South Africa, business conditions significantly
improved in 2021. Looking forward into 2022, to date we have continued to see higher
coal prices contributing strongly to the performance of our South African operations.
Covid-19 update
The Group continues to consult with the
government authorities and its
stakeholders in South Africa to ensure
appropriate measures are taken across its
South African mining and processing
operations. Such measures have been
primarily focussed on the health and
safety of our employees. Further details
on these measures can be found in our
Sustainability report on page 7.
Production and operations
Difficult mining conditions at Black Wattle,
our South African mining operation,
impacted production in 2021. Overall, the
mine achieved production of 1.04 million
metric tonnes compared to 1.18 million
metric tonnes in 2020. Looking forward,
the mine will be transitioning into new coal
reserves over the first half of 2022 where
mining conditions and production capacity
is expected to improve in comparison to
the reserves mined in 2021. Although
mining production may be impacted in the
first half of 2022, mining production is
expected to improve once this transition
to the new reserves is complete. Overall,
we expect the Group’s mining production
in 2022 to remain at similar levels to 2021.
As noted in the Chairman’s statement, we
are very pleased to report the acquisition
of 6.1 million metric tonnes of coal reserves
contiguous to Black Wattle. The new
reserve, which is currently subject to
regulatory approval, will extend the life of
mine of Black Wattle to eight years. The
acquisition was negotiated in conjunction
with a re-negotiation of 2.1million metric
tonnes of separate coal reserves previously
acquired from the same seller, as
announced in our 2018 annual report. In
addition to a nominal financial consideration,
an option for offtake of processed coal from
both reserves has been entered into with
the seller. We would like to thank Vunani
Mining, our Black Economic Empowered
shareholders at Black Wattle, for their
significant contribution in acquiring these
reserves. In light of their integral
involvement, it has been agreed that
Vunani Mining will share equally in any
distributable income from the coal
reserves as part of their non-controlling
interest in Black Wattle. This has been
achieved through the issue of new shares
in Black Wattle. Further details on the
share issue can be found in the Financial
and Performance Review on page 16.
Main trends/markets
Improvement in global economic activity
had a significant impact on demand and
prices achievable for our coal in 2021. In
the international market the average
weekly price of Free On Board (FOB) Coal
from Richard Bay Coal Terminal (API4
price) averaged $125 in 2021 compared
to $65 in 2020 when coal prices and
economic activity remained largely
supressed due to the Covid-19 pandemic.
The higher prices, along with a stable US
Dollar compared to the South African
Rand, resulted in the Group achieving an
overall average Rand price of R1,129 per
tonne of export coal sold from the mine in
2021 compared to R547 in 2020. The
Group’s export sales are via Richards Bay
Coal Terminal, primarily under the Quattro
programme which allows junior black-
economic empowerment coal producers
direct access to the coal export market via
the terminal. Although our export volumes
to Richards Bay were limited by industry
constraints in transporting coal for export
on the South African rail network, overall
exports volumes from our South African
operations increased during the year to
320,000 metric tonnes compared to
230,000 metric tonnes in 2020.
6 Bisichi PLC
Strategic Report Principal activity, strategy & business model
These export constraints, arising from the
problems of the rail network, contributed
to a stable supply of coal to the South
African domestic market in 2021. As a
result, domestic coal prices in 2021
remained largely unchanged by
comparison with the 2020 prices; the
Group achieved an average domestic
price of R470 per tonne coal sold
compared to R450 in 2020. Overall,
domestic sales volumes from our South
African operations increased during the
year to 1.13million metric tonnes (2020:
0.97million metric tonnes).
Overall, the Group achieved an average
Rand price per tonne of coal sold of R616
compared to R469 in 2020. In addition to
the higher coal prices, higher overall sales
volumes and a reduction in stocks
contributed to the increase in Sterling
Group revenue during the year.
Looking forward into 2022, in the first
quarter we have seen the API4 price
average $238 and exports from our South
African operations to date have been in
line with the average export tonnages we
achieved in 2021. However, looking
beyond the first quarter, uncertainties
remain. These are particularly with regard
to the sustainability of the higher
international coal price as well as the
impact of continued constraints in
transporting coal for export on the South
African rail network.
Sustainable development
The Group’s South African operations
continue to strive to conduct business in a
safe, environmentally and socially
responsible manner. Some highlights of
our Health, Safety and Environment
performance in 2021:
• • The Group’s South African operations
recorded two Lost time Injuries during
2021 (2020: One).
• • No cases of Occupational Diseases
were recorded.
• • Zero claims for the Compensation for
Occupational Diseases were submitted.
In South Africa, the new government
regulated Broad-Based Socio-Economic
Empowerment Charter for the Mining and
Minerals Industry, 2020 (New Mining
Charter) came into force from March
2020. The New Mining Charter is a
regulatory instrument that facilitates
sustainable transformation, growth and
development of the mining industry. The
Group is committed to fully complying
with the New Mining Charter and
providing adequate resources to this area
in order to ensure opportunities are
expanded for historically disadvantaged
South Africans (HDSAs) to enter the
mining and minerals industry. In addition,
we continue to adhere and make progress
in terms of our Social and Labour Plan
and our various BEE initiatives. A fuller
explanation of these can be found in our
Sustainable Development Report on page
7.
Prospects
Management would like to thank all our
employees and stakeholders in helping
overcome many of the unprecedented
challenges presented by the Covid-19
pandemic over the last two years. Going
forward, I am confident that 2022 should
be another successful year for our South
African operations.
Andrew Heller
Managing Director
13 April 2022
77Bisichi PLC
Strategic Report
Social, community and
humanrights issues
The Group believes that it is in the
shareholders’ interests to consider social
and human rights issues when
conducting business activities both in the
UK and South Africa. Various policies and
initiatives implemented by the Group that
fall within these areas are discussed
within this report.
Health, Safety &
Environment (HSE)
The Group is committed to creating a
safe and healthy working environment for
its employees and the health and safety
of our employees is of the utmost
importance.
HSE performance in 2021:
• • No cases of Occupational Diseases
were recorded.
• • Zero claims for the Compensation for
Occupational Diseases were submitted.
• • No machines operating at Black Wattle
exceeded the regulatory noise level.
• • The Group’s South African operations
recorded two Lost time Injuries during
2021.
In addition to the required personnel
appointments and assignment of direct
health and safety responsibilities on the
mine, a system of Hazard Identification
and Risk Assessments has been
designed, implemented and maintained
at Black Wattle and at Sisonke Coal
Processing.
Health and Safety training is conducted
on an ongoing basis. We are pleased to
report all relevant employees to date have
received training in hazard identification
and risk assessment in their work areas.
A medical surveillance system is also in
place which provides management with
information used in determining measures
to eliminate, control and minimise
employee health risks and hazards and all
Occupational Health hazards are
monitored on an ongoing basis.
Various systems to enhance the current
HSE strategy have been introduced as
follows:
• • In order to improve hazard identification
before the commencing of tasks, mini
risk assessment booklets have been
distributed to all mine employees and
long term contractors on the mine.
• • Dover testing is conducted for all
operators. Dover testing is a risk
detection and accident reduction tool
which identifies employees’ problematic
areas in their fundamental skills in
order to receive appropriate training.
• • A Job Safety Analysis form is utilised to
ensure effective identification of
hazards in the workplace.
• • In order to capture and record
investigation findings from incidents, an
incident recording sheet is utilised by
line management and contractors.
• • Black Wattle Colliery utilises ICAM
(Incident Cause Analysis Method).
• • On-going training on first aid is being
conducted with all employees involved
with this discipline.
Covid-19 measures in 2021:
The Group continues to monitor and
adhere to all of the South African
government’s Covid-19 related guidelines
and regulations including all updates and
advice from the National Department of
Health, the Department of Minerals
Resources and Energy and the Office of
the President. These measures include:
• • Regular communications with
employees on all guidelines,
government restrictions and best
practice hygiene and health
recommendations;
• • Conducting various issue-based hazard
identification and risk assessments;
• • Temperature screening of those
entering certain of our offices and sites;
• • Working from home (in both the UK and
South Africa), where possible or
required;
• • Social distancing measures at
operating sites;
• • Restrictions on non-essential visits
to operating sites; and
• • Intensified cleaning and hygiene at
offices and sites.
Sustainable development
The Group is fully committed to ensuring the sustainability of both our UK and
South African operations and delivering long term value to all our stakeholders.
8 Bisichi PLC
In particular the Group has endeavoured
to follow the guidelines of the 10-point
plan developed by the Department of
Minerals Resources and Energy in line
with the guidelines of the Department of
Health and the National Institute of
Communicable Diseases (NICD) as
follows:
• • Educate employees on the virus,
symptoms and prevention.
• • Follow guidelines from the NICD,
educate health workers on how to
manage Covid-19. Consider alternate
arrangements for supply of chronic
medication to reduce crowds.
• • Ensure that all health workers have
access to protective clothing, gloves,
masks, cleaning materials and
pharmaceutical agents.
• • Vaccinate employees for seasonal
influenza.
• • All employees are encouraged to know
their status, get onto ARVs if positive
for HIV.
• • Manage suspected cases or contacts
of cases using guidelines from the
NICD.
• • Liaise with the NICD on procedure to
be followed for suspected and
confirmed cases.
• • Only essential travel to areas with
Covid-19 should be undertaken.
• • All suspected and confirmed cases in
the mining industry should be reported
to the NICD.
• • Monitor and stay aware of the latest
information on the Covid-19 pandemic.
Black Wattle Colliery Social
and Labour Plan (SLP) and
Community Projects
Black Wattle Colliery is committed to true
transformation and empowerment as well
as poverty eradication within the
surrounding and labour providing
communities.
Black Wattle is committed to providing
opportunities for the sustainable socio-
economic development of its
stakeholders, such as:
• • Employees and their families, through
Skills Development, Education
Development, Human Resource
Development, Empowerment and
Progression Programmes.
• • Surrounding and labour sending
communities, through Local Economic
Development, Rural and Community
Development, Enterprise Development
and Procurement Programmes.
• • Empowering partners, through Broad-
Based Black Economic Empowerment
(BBBEE) and Joint Ventures with
Historically Disadvantaged South
African (HDSA) new mining entrants
and enterprises.
• • The company engages in on going
consultation with its stakeholders to
develop strong company-employee
relationships, strong company-
community relationships and strong
company-HDSA enterprise
relationships.
The key focus areas in terms of the
detailed SLP programmes were updated
as follows:
• • Implementation of new action plans,
projects, targets and budgets were
established through regular workshops
with all stakeholders.
• • A comprehensive desktop socio-
economic assessment was undertaken
on baseline data of the Steve Tshwete
Local Municipality (STLM) and
Nkangala District Municipality (NDM).
• • The STLM is still in the process of
finalising its 2022-2027 Local
Economic Development (LED) Plan.
Once finalised, Black Wattle Colliery
will select projects from the 2022-2027
STLM LED plan for the inclusion in its
2022-2027 SLP. The Black Wattle
Colliery SLP will thereafter be
submitted to the department of Mineral
Resources and Energy for approval.
• • The building of the new school hall at
the Phumelele Secondary School in the
Rockdale Township will be completed
during the second quarter of 2022.
• • Various upgrades were initiated at the
Evergreen School nearby to Black Wattle.
Black Wattle has implemented various
community initiatives including:
• • A community training environmental
project, where local community
members are trained to safely cut and
remove non-indigenous vegetation, the
making, bagging and sales of charcoal.
• • Certain community members have
been identified for training in areas
regarding mining and beneficiation.
These areas include but are not limited
to conveyor maintenance, operation of
mining machinery and training in
environmental waste management.
• • An interlocking block manufacturing
operation will be started during 2022,
making interlocking blocks for building
homes
• • Two HDSA females completed their
University studies in the 2021 academic
year.
• • Two local community HDSA members
were enrolled for the new academic year.
Strategic Report Sustainable development
99Bisichi PLC
Strategic Report Sustainable development
Environment & Environment
Management Programme
South Africa
Under the terms of the mine’s
Environmental Management Programme
approved by the Department of Mineral
Resource and Energy (“DMRE”), Black
Wattle undertakes a host of environmental
protection activities to ensure that the
approved Environmental Management Plan
is fully implemented. In addition to these
routine activities, Black Wattle regularly
carries out environmental monitoring
activities on and around the mine, including
evaluation of ground water quality, air
quality, noise and lighting levels, ground
vibrations, air blast monitoring, and
assessment of visual impacts. In addition to
this Black Wattle also performs quarterly
monitoring of all boreholes around the mine
to ensure that no contaminated water filters
through to the surrounding communities.
Black Wattle is fully compliant with the
regulatory requirements of the
Department of Water Affairs and Forestry
and has an approved water use licence.
Black Wattle Colliery has substantially
improved its water management by
erecting and upgrading all its pollution
control dams in consultation with the
Department of Water Affairs and Forestry.
A performance assessment audit was
conducted to verify compliance to our
Environmental Management Programme
and no significant deviations were found.
United Kingdom
The Group’s UK activities are principally
retail property investment as well as
residential property development whereby
we provide or develop premises which are
rented to retail businesses or sold on to end
users. We seek to provide tenants and
users in both these areas with good quality
premises from which they can operate or
reside in an environmentally sound manner.
Procurement
In compliance with the Mining Charter
and the Mineral and Petroleum Resource
Development Act, the Group’s South
African operations has implemented a
BBBEE-focussed procurement policy
which strongly encourages our suppliers
to establish and maintain BBBEE
credentials. At present, BBBEE
companies provide approximately 90
percent of Black Wattle’s equipment and
services.
Mining Charter
In South Africa, the new government
regulated Broad-Based Socio-Economic
Empowerment Charter for the Mining and
Minerals Industry, 2020 (New Mining
Charter) came into force from March
2020. The New Mining Charter is a
regulatory instrument that facilitates
sustainable transformation, growth and
development of the mining industry. The
Group’s mining operation is expected to
reach various levels of compliance to the
New Mining Charter over a period of five
years from March 2020. The Group is
committed to providing adequate
resources to this area in order to ensure
full compliance to the New Mining Charter
is achieved over the transitional period.
As part of Black Wattle’s commitment to
the New Mining Charter, the company
seeks to:
• • Expand opportunities for historically
disadvantaged South Africans
(HDSAs), including women and youth,
to enter the mining and minerals
industry and benefit from the extraction
and processing of the country’s
resources;
• • Utilise the existing skills base for the
empowerment of HDSAs; and
• • Expand the skills base of HDSAs in
order to serve the community.
Employment
The Group’s South African operations are
committed to achieving the goals of the
South African Employment Equity Act
and is pleased to report the following:
• • Black Wattle Colliery has exceeded the
10 percent women in management and
core mining target.
• • Black Wattle Colliery has achieved over
15 percent women in core mining.
• • 94 percent of the women at Black
Wattle Colliery are HDSA females.
Black Wattle Colliery has successfully
submitted their annual Employment
Equity Report to the Department of
Labour.
In terms of staff training some highlights
for 2021 were:
• • 12 employees were trained in ABET
(Adult Basic Educational Training) on
various levels;
• • An additional 9 disabled HDSA women
continued their training on ABET levels
one to four.
• • We are pleased to confirm that 1 HDSA
male completed his apprenticeships in
2021.
• • Further to the above we confirm that 1
HDSA female was allocated a Bursary
for the 2021 period whilst 2 HDSA
males and 2 HDSA females continued
their Bursaries.
Highlights for 2021 for Sisonke Coal
Processing:
• • 5 employees were trained in ABET
(Adult Basic Educational Training) on
various levels
10 Bisichi PLC
Strategic Report Sustainable development
Employment terms and conditions for our
employees based at our UK office and at
our South African mining operations are
regulated by and are operated in
compliance with all relevant prevailing
national and local legislation. Employment
terms and conditions provided to mining
staff meet or exceed the national
average. The Group’s mining operations
and coal washing plant facility are labour
intensive and unionised. During the year
no labour disputes, strikes or wage
negotiations disrupted production or had
a significant impact on earnings. The
Group’s relations to date with labour
representatives and labour related unions
continue to remain strong.
In terms of directors, employees and
gender representation, at the year end
the Group had 9 directors (8 male, 1
female), 6 senior managers (5 male, 1
female) and 229 employees (160 male,
69 female).
Anti-slavery and human
trafficking
The Group is committed to the prevention
of the use of forced labour and has a zero
tolerance policy for human trafficking and
slavery. The Group’s policies and
initiatives in this area can be found within
the Group’s Anti-slavery and human
trafficking statement found on the
Group’s website at www.bisichi.co.uk.
Green House Gas reporting
We have reported on all of the emission
sources required under the Companies
Act 2006 (Strategic Report and Directors’
Reports) Regulations.
The data detailed in these tables
represent emissions and energy use for
which the Group is responsible. To
calculate our emissions, we have used the
main requirements of the Greenhouse
Gas Protocol Corporate Standard and a
methodology adapted from the
Intergovernmental Panel on Climate
Change (2019), along with the UK
Government GHG Conversion Factors for
Company Reporting 2021. Any estimates
included in our totals are derived from
actual data which have been extrapolated
to cover the full reporting periods.
Our reporting includes our energy use
and emissions associated with our UK
office, which are minimal (2 tonnes of
CO
2
e). The IPCC methodology *Tier 1 (+2)
Methodology (2006 with 2019 edits) -
Low, Average, and High CH
4
Emission
Factors – Medium Scenario) was used to
calculate emissions from surface coal
mining activities. The Group has not
implemented any energy efficiency
programs or specific measures during the
2021 year.
The group’s carbon footprint:
2021
CO
2
e
Tonnes
2020
CO
2
e
Tonnes
Emissions source:
Emissions from the combustion of fuel or the operation of
any facility including fugitive emis-sions from refrigerants
use
41,960 46,162
Emissions resulting from the purchase of electricity, heat, steam
or cooling by the company for its own use (location based)
12,040 12,482
Total gross emissions 54,000 58,644
Intensity:
Tonnes of CO
2
per £ sterling of revenue 0.0011 0.0020
Tonnes of CO
2
per tonne of coal produced 0.0516 0.0497
kWh kWh
Energy consumption used to calculate above emissions 83,079,614 99,450,585
Of which UK 10,186 5,571
1111Bisichi PLC
Strategic Report
Principal risks & uncertainties
PRINCIPAL RISK PERFORMANCE AND MANAGEMENT OF THE RISK
COAL PRICE AND VOLUME RISK COVID-19 RISK
The Group is exposed to coal price risk as its future revenues
will be derived based on contracts or agreements with physical
off-take partners at prices that will be determined by reference
to market prices of coal at delivery date.
The Group’s South African mining and coal processing
operational earnings are significantly dependent on
movements in both the export and domestic coal price.
The price of export sales is derived from a US Dollar-
denominated export coal price and therefore the price
achievable in South African Rands can be influenced by
movements in exchange rates and overall global demand and
supply. The volume of export sales achievable can be
influenced by rail capacity and export quota constraints at
Richards Bay Coal Terminal under the Quattro programme.
The domestic market coal prices are denominated in South
African Rand and are primarily dependant on local demand
and supply.
In the short term, the Covid-19 pandemic and geo-political
events in Ukraine may result in additional price volatility in both
the export and domestic market due to fluctuations in both
demand and supply.
Longer term both the demand and supply of coal in the
domestic and global market may be negatively impacted by
regulatory changes related to climate change and
governmental CO
2
emission commitments.
The Group primarily focuses on managing its underlying
production and processing costs to mitigate coal price volatility
as well as from time to time entering into forward sales contracts
with the goal of preserving future revenue streams. The Group
has not entered into any such contracts in 2020 and 2021.
The Group’s export and domestic sales are determined based on
the ability to deliver the quality of coal required by each market
together with the market factors set out opposite. Volumes of
export sales achieved during the year were primarily dependent
on the Group’s ability to produce the higher quality of coal
required for export, obtaining adequate rail capacity and utilising
allowable export quotas under the Quattro programme. The
volume of domestic market sales achieved during the year were
primarily dependant on local demand and supply as well as the
Group’s ability to produce the overall quality of coal required. The
Group continues to assess on an ongoing basis its dependence
on the above factors and evaluate alternative means to ensure
coal sales and prices achieved are optimised.
The Group assesses on an ongoing basis the impact that
Covid-19, geo-political events in Ukraine, regulatory changes
related to climate change and governmental CO
2
emission
commitments may have on the Group’s mining operations and
future investment decisions.
12 Bisichi PLC
PRINCIPAL RISK PERFORMANCE AND MANAGEMENT OF THE RISK
MINING RISK
As with many mining operations, the reserve that is mined has
the risk of not having the qualities and accessibility expected
from geological and environmental analysis. This can have a
negative impact on revenue and earnings as the quality and
quantity of coal mined and sold by our mining operations may
be lower than expected.
This risk is managed by engaging independent geological
experts, referred to in the industry as the “Competent Person”, to
determine the estimated reserves and their technical and
commercial feasibility for extraction. In addition, management
engage Competent Persons to assist management in the
production of detailed life of mine plans as well as in the
monitoring of actual mining results versus expected performance
and management’s response to variances. The Group continued
to engage an independent Competent Person in the current year.
Refer to page 5 for details of mining performance.
CURRENCY RISK
The Group’s operations are sensitive to currency movements,
especially those between the South African Rand, US Dollar
and British Pound. These movements can have a negative
impact on the Group’s mining operations revenue as noted
above, as well as operational earnings.
The Group is exposed to currency risk in regard to the Sterling
value of inter-company trading balances with its South African
operations. It arises as a result of the retranslation of Rand
denominated inter-company trade receivable balances into
Sterling that are held within the UK and which are payable by
South African Rand functional currency subsidiaries.
The Group is exposed to currency risk in regard to the
retranslation of the Group’s South African functional currency
net assets to the Sterling reporting functional currency of the
Group. A weakening of the South African Rand against Sterling
can have a negative impact on the financial position and net
asset values reported by the Group.
Export sales within the Group’s South African operations are
derived from a US Dollar-denominated export coal price. A
weakening of the US Dollar can have a negative impact on the
South African Rand prices achievable for coal sold by the
Group’s South African mining operations. This in turn can have a
negative impact on the Group’s mining operations revenue as
well as operational earnings as the Group’s mining operating
costs are Rand denominated. In order to mitigate this, the Group
may enter into forward sales contracts in local currencies with
the goal of preserving future revenue streams. The Group has
not entered into any such contracts in 2021 and 2020.
Although it is not the Group’s policy to obtain forward contracts
to mitigate foreign exchange risk on inter-company trading
balances or on the retranslation of the Group’s South African
functional currency net assets, management regularly review the
requirement to do so in light of any increased risk of future
volatility.
Refer to the ‘Financial Review’ for details of significant currency
movement impacts in the year.
Strategic Report Principal risks & uncertainties
1313Bisichi PLC
PRINCIPAL RISK PERFORMANCE AND MANAGEMENT OF THE RISK
NEW RESERVES AND MINING PERMISSIONS
The life of the mine, acquisition of additional reserves,
permissions to mine (including ongoing and once-off
permissions) and new mining opportunities in South Africa
generally are contingent on a number of factors outside of the
Group’s control such as approval by the Department of Mineral
Resources and Energy, the Department of Water Affairs and
Forestry and other regulatory or state owned entities.
In addition, the Group’s South African operations are subject to
the government Mining Charter with the New Mining Charter
coming into force from March 2020. Failure to meet existing
targets or further regulatory changes to the Mining Charter,
could adversely affect the mine’s ability to retain its mining
rights in South Africa.
The work performed in the acquisition and renewal of mining
permits as well as the maintenance of compliance with permits
includes factors such as environmental management, health and
safety, labour laws and Black Empowerment legislation (such as
the New Mining Charter); as failure to maintain appropriate
controls and compliance may in turn result in the withdrawal of
the necessary permissions to mine. The management of these
regulatory risks and performance in the year is noted in the
Mining Review on page 5 as well as in the Sustainable
Development report on page 7 and in this section under the
headings environmental risk, health & safety risk and labour risk.
Additionally, in order to mitigate this risk, the Group strives to
provide adequate resources to this area including the
employment of adequate personnel and the utilisation of third
party consultants competent in regulatory compliance related to
mining rights and mining permissions.
The Group also continues to actively seek new opportunities to
expand its mining operations in South Africa through the
acquisition of additional coal reserves and new commercial
arrangements with existing mining right holders.
POWER SUPPLY RISK
The current utility provider for power supply in South Africa
is the government run Eskom. Eskom continues to undergo
capacity problems resulting in power cuts and lack of provision
of power supply to new projects. Any power cuts or lack of
provision of power supply to the Group’s mining operations may
disrupt mining production and impact on earnings.
The Group’s mining operations have to date not been affected by
power cuts. However the Group manages this risk through
regular monitoring of Eskom’s performance and ongoing ability to
meet power requirements. In addition, the Group continues to
assess the ability to utilise diesel generators as an alternative
means of securing power in the event of power outages.
FLOODING RISK
The Group’s mining operations are susceptible to seasonal
flooding which could disrupt mining production and impact on
earnings.
Management monitors water levels on an ongoing basis and
various projects have been completed, including the
construction of additional dams, to minimise the impact of this
risk as far as possible.
Strategic Report Principal risks & uncertainties
14 Bisichi PLC
PRINCIPAL RISK PERFORMANCE AND MANAGEMENT OF THE RISK
ENVIRONMENTAL RISK
The Group’s South African mining operations are required to
adhere to local environmental regulations. Any failure to adhere
to local environmental regulations, could adversely affect the
mine’s ability to mine under its mining right in South Africa.
In line with all South African mining companies, the management
of this risk is based on compliance with the Environment
Management Plan. In order to ensure compliance, the Group
strives to provide adequate resources to this area including the
employment of personnel and the utilisation of third party
consultants competent in regulatory compliance related to
environmental management.
To date, Black Wattle is fully compliant with the regulatory
requirements of the Department of Water Affairs and Forestry
and has an approved water use licence. Further details of the
Group’s Environment Management Programme are disclosed in
the Sustainable development report on page 7.
HEALTH & SAFETY RISK
Attached to mining there are inherent health and safety risks.
Any such safety incidents disrupt operations, and can slow or
even stop production. In addition, the Group’s South African
mining operations are required to adhere to local Health and
Safety regulations as well as enhanced health and Safety
measures related to Covid-19.
The Group has a comprehensive Health and Safety programme
in place to mitigate this risk. Management strive to create an
environment where Health and safety of our employees is of the
utmost importance. Our Health & Safety programme provides
clear guidance on the standards our mining operation is
expected to achieve. In addition, management receive regular
updates on how our mining operations are performing. Further
details of the Group’s Health and Safety Programme are
disclosed in the Sustainable Development report on page 7.
LABOUR RISK
The Group’s mining operations and coal washing plant facility
are labour intensive and unionised. Any labour disputes,
strikes or wage negotiations may disrupt production and
impact earnings.
In order to mitigate this risk, the Group strives to ensure open
and transparent dialogue with employees across all levels. In
addition, appropriate channels of communication are provided to
all employment unions at Black Wattle to ensure effective and
early engagement on employment matters, in particular wage
negotiations and disputes.
Refer to the ‘Employment’ section on page 9 for further details.
Strategic Report Principal risks & uncertainties
1515Bisichi PLC
PRINCIPAL RISK PERFORMANCE AND MANAGEMENT OF THE RISK
CASHFLOW RISK
Commodity price risk, currency volatility and the uncertainties
inherent in mining may result in favourable or unfavourable
cashflows.
In order to mitigate this, we seek to balance the high risk of our
mining operations with a dependable cash flow from our UK
property investment operations which are actively managed by
London & Associated Properties PLC and our equity investment
portfolio. Due to the long term nature of the leases, the effect on
cash flows from property investment activities are expected to
remain stable as long as tenants remain in operation. Refer to
Financial and Performance review on page 20 for details of the
property and investment portfolio performance.
PROPERTY VALUATION RISK
Fluctuations in property values, which are reflected in the
Consolidated Income Statement and Balance Sheet, are
dependent on an annual valuation of the Group’s commercial
and residential development properties. A fall in UK commercial
and residential property can have a marked effect on the
profitability and the net asset value of the Group as well as
impact on covenants and other loan agreement obligations.
The economic performance of the United Kingdom, including
the potential final impact of the United Kingdom leaving the
European Union (“Brexit”), the final impact of Covid-19
pandemic, an impact from geo-political events in Ukraine as
well as the current overall economic performance and trends of
the UK retail market, may impact the level of rental income,
yields and associated property valuations of the Group’s UK
property assets including its investments in Joint Ventures.
The Group utilises the services of London & Associated Properties
PLC whose responsibility is to actively manage the portfolio to
improve rental income and thus enhance the value of the portfolio
over time. In addition, management regularly monitor banking
covenants and other loan agreement obligations as well as the
performance of our property assets in relation to the overall
market over time.
Management continues to monitor and evaluate the impact of
Brexit, the Covid-19 pandemic, geo-political events in Ukraine and
the current economic performance of the UK retail market on the
future performance of the Group’s existing UK portfolio. In
addition, the Group assesses on an ongoing basis the
performance of the UK retail market on the Group’s banking
covenants, loan obligations and future investment decisions.
Refer to page 20 for details of the property portfolio performance.
COVID-19 RISK
The Group is continually assessing and managing any potential
further risks brought about by the Covid-19 pandemic. Overall,
the Group is primarily exposed to impacts on the health and
safety of its employees and stakeholders. In the UK,
uncertainties remain on the final impact on retail property
revenue and values from the Covid-19 pandemic as outlined
under property valuation risk above. In South Africa, the Group
may be impacted by additional health and safety measures
related to its workforce and coal price risk as outlined under
the same heading above.
Risks faced by the business are assessed by the Board on an
ongoing basis.
Strategies for mitigating the risks have been defined and specific
measures for achieving these have already been implemented.
These include the measures outlined in the Sustainability
development section of this report.
The final impact of the Covid-19 pandemic remains uncertain and
the Group will adapt plans accordingly as any new information
becomes available or government advice changes.
Strategic Report Principal risks & uncertainties
16 Bisichi PLC
Strategic Report
EBITDA, adjusted EBITDA and mining
production are used as key performance
indicators for the Group and its mining
activities as the Group has a strategic focus
on the long term development of its existing
mining reserves and the acquisition of
additional mining reserves in order to realise
shareholder value. Mining production can
be defined as the coal quantity in metric
tonnes extracted from our reserves during
the period and held by the mine before any
processing through the washing plant.
Whilst profit/(loss) before tax is considered
as one of the key overall performance
indicators of the Group, the profitability of
the Group and the Group’s mining activities
can be impacted by the volatile and capital
intensive nature of the mining sector.
Accordingly, EBITDA and adjusted EBITDA
are primarily used as key performance
indicators as they are indicative of the value
associated with the Group’s mining assets
expected to be realised over the long term
life of the Group’s mining reserves. In
addition, for the Group’s property
investment operations, the net property
valuation and net property revenue are
utilised as key performance indicators as
the Group’s substantial property portfolio
reduces the risk profile for shareholders by
providing stable cash generative UK assets
and access to capital appreciation. Certain
key performance indicators below are not
Generally Accepted Accounting Practice
measures and are not intended as a
substitute for those measures, and may or
may not be the same as those used by
other companies.
Key performance indicators
The key performance indicators for the group are:
2021
£’000
2020
£’000
For the group:
Operating profit /(loss) before depreciation, fair value adjustments and exchange movements (adjusted EBITDA) 5,028 (1,111)
EBITDA 5,849 (2,387)
Profit/(Loss) before tax 2,501 (5,196)
For our property investment operations:
Net property valuation 10,525 10,270
Net property revenue 1,119 1,181
For our mining activities:
Operating profit/(loss) before depreciation, fair value adjustments and exchange movements (adjusted EBITDA) 4,266 (1,821)
EBITDA 4,145 (1,782)
Tonnes
’000
Tonnes
’000
Mining production 1,046 1,180
Quantity of coal sold 1,447 1,199
Financial & performance review
The movement in the Group’s Adjusted EBITDA from a loss of £1.1million in 2020 to
a profit of £5.0million in 2021 can mainly be attributed to higher prices achievable for
our coal and higher coal sale volumes from the Group’s South African operations in
the second half of the year. This offset the higher operating costs achieved in 2021.
1717Bisichi PLC
The key performance indicators of the group
can be reconciled as follows:
Mining
£’000
Property
£’000
Other
£’000
2021
£’000
Revenue 49,226 1,119 175 50,520
Transport and loading cost (5,569) - - (5,569)
Mining and washing costs (32,438) - - (32,438)
Other operating costs excluding depreciation (6,953) (527) (5) (7,485)
Operating profit before depreciation, fair value adjustments and
exchange movements (adjusted EBITDA)
4,266 592 170 5,028
Exchange movements (121) - - (121)
Fair value adjustments - 255 - 255
Gains on investments held at fair value through profit and loss (FVPL) - - 812 812
Operating profit excluding depreciation 4,145 847 982 5,974
Share of loss in joint venture - (125) - (125)
EBITDA 4,145 722 982 5,849
Net interest movement (777)
Depreciation (2,571)
Profit before tax 2,501
The key performance indicators of the Group
can be reconciled as follows:
Mining
£’000
Property
£’000
Other
£’000
2020
£’000
Revenue 28,567 1,181 57 29,805
Transport and loading cost (1,906) - - (1,906)
Mining and washing costs (22,739) - - (22,739)
Other operating costs excluding depreciation (5,743) (523) (5) (6,271)
Operating (loss)/profit before depreciation, fair value adjustments
and exchange movements (adjusted EBITDA)
(1,821) 658 52 (1,111)
Exchange movements 39 - - 39
Fair value adjustments - (1,295) - (1,295)
Gains on investments held at fair value through profit and loss (FVPL) - - 67 67
Operating (loss)/profit excluding depreciation (1,782) (637) 119 (2,300)
Share of loss in joint venture - (87) - (87)
EBITDA (1,782) (724) 119 (2,387)
Net interest movement (616)
Depreciation (2,193)
Loss before tax (5,196)
Strategic Report Financial & performance review
18 Bisichi PLC
Adjusted EBITDA is used as a key indicator
of the operating trading performance of
the Group and its operating segments
representing operating profit before the
impact of depreciation, fair value
adjustments, gains/(losses) on disposal of
other investments and foreign exchange
movements. The Group’s operating
segments include its South African mining
operations and UK property. The
performance of these two operating
segments are discussed in more detail
below.
The Group achieved an EBITDA for the
year of £5.8million (2020: loss
£2.4million). The movement compared to
the prior year can mainly be attributed to
the operating profit before depreciation
from our mining activities of £4.3million
(2020: loss £1.8million).
The Group’s fair value gains, related to
our UK property were £0.3million (2020:
loss £1.3million) and those related to
investments held at fair value through
profit and loss were £0.8million (2020:
£0.1million). Overall, the Group reported
an overall profit before tax of £2.5million
(2020: loss £5.2 million). Taxation for the
year increased to £0.8million (2020: gain
of £1.4million). This resulted in the Group
achieving an overall profit for the year
after tax of £1.7million (2020: loss
£3.8million), of which £1.5million (2020:
loss £3.4million) was attributable to
equity holders of the company.
South African mining operations
South African Rand UK Sterling
2021
R’000
2020
R’000
2021
£’000
2020
£’000
Revenue 1,004,444 602,581 49,223 28,567
Transport and loading costs (113,641) (40,204) (5,569) (1,906)
Mining and washing costs (661,929) (479,647) (32,438) (22,739)
Operating profit before other operating costs and depreciation 228,874 82,730 11,216 3,922
Other operating costs (excluding depreciation) (6,950) (5,743)
Operating profit before depreciation, fair value adjustments and
exchange movements (adjusted EBITDA)
4,266 (1,821)
Exchange movements (121) 39
EBITDA 4,145 (1,782)
2021
’000
2020
’000
Mining production in tonnes 1,046 1,180
2021
R
2020
R
Net Revenue per tonne of mining production 852 477
Mining and washing costs per tonne of mining production (633) (406)
Operating profit per tonne of mining production before other operating costs and depreciation 219 71
Net Revenue per tonne of mining production can be defined as the revenue price achieved per metric tonne of mining production
less transportation and loading costs.
Performance
The key performance indicators of the group’s South African mining
operationsarepresented in South African Rand and UK Sterling as follows:
Strategic Report Financial & performance review
1919Bisichi PLC
Strategic Report Financial & performance review
A breakdown of the quantity of coal sold and revenue of the Group’s South African mining operations are presented in metric
tonnes and South African Rand as follows:
Domestic
’000
Export
’000
2021
’000
Domestic
’000
Export
’000
2020
’000
Quantity of coal sold in tonnes 1,127 320 1,447 969 230 1,199
Domestic
R’000
Export
R’000
2021
R’000
Domestic
R’000
Export
R’000
2020
R’000
Revenue 530,905 473,539 1004,444 442,516 160,065 602,581
R R R R R R
Net Revenue per tonne of coal sold 470 1,129 616 450 547 469
Mining and washing costs per tonne of coal sold (457) (400)
Operating profit per tonne of coal sold before
other operating costs and depreciation
158 69
The quantity of coal sold can be defined
as the quantity of coal sold in metric
tonnes by the Group in any given period.
Net Revenue per tonne of coal sold can
be defined as the revenue price achieved
less transportation and loading costs per
metric tonne of coal sold.
Total net revenue per tonne of coal sold
for the Group’s mining and processing
operations increased for the year from
R469 per tonne of coal sold in 2020 to
R616 in 2021, mainly attributable to the
average price increase achieved in the
export market. A decrease in mining
production during the year, attributable to
difficult mining conditions, was offset by
an increase in buy-in coal processed and
a decrease in coal inventories due to
improved coal demand resulting in the
quantity of coal sold for the year
increasing to 1.447million tonnes (2020:
1.199million tonnes). Overall, the increase
in revenue per tonne of coal sold and the
higher coal sales volumes, particularly in
the export market, resulted in revenue
from the Group’s South African mining
operations increasing during the year to
R1.005billion compared to revenue of
R0.603billion in the prior year.
Mining and washing costs per tonne of
coal sold during the year increased from
R400 per tonne in 2020 to R457 per
tonne in 2020 due to incremental
increases in both mining and washing
costs. This resulted in an increase in total
mining and washing costs for the Group
to R661.9million (2020: R479.6million).
Other operating costs (excluding
depreciation) of £6.95million (2020:
£5.74million) include general administrative
costs as well as administrative salaries and
wages related to our South African mining
operations that are incurred both in South
Africa and in the UK. These costs are not
significantly impacted by movements in
mining production and coal processing.
The increase during the year can mainly be
attributed to lower administrative salaries
and wages costs incurred in 2020 due to
the financial performance of the Group in
the same period. Overall costs in South
Africa were in line with management’s
expectations and local inflation.
Overall, the movement in the Group’s
Adjusted EBITDA from a loss of £1.1million
in 2020 to a profit of £5.0million in 2021
can mainly be attributed to higher prices
achievable for our coal and increased coal
sales from the Group’s South African coal
processing operations. This offset the
higher mining, washing and operating
costs incurred in 2021. A further
explanation of the mines operational
performance can be found in the Mining
Review on page 5.
Non-controlling interest Black Wattle
As mentioned in the Chairman’s statement
and Mining Review, the Group’s subsidiary
Black Wattle Colliery (Pty) Ltd signed an
agreement to acquire additional coal
reserves during the year. The new reserves
of 6.1million metric tonnes, will extend the
life of mine of Black Wattle to eight years
and remains subject to regulatory approval.
The acquisition was negotiated in
conjunction with a re-negotiation of
2.1million metric tonnes of separate coal
reserves previously acquired from the
same seller, as previously announced in
our 2018 annual report.
20 Bisichi PLC
Strategic Report Financial & performance review
Vunani Mining (Pty) Ltd our black
economic empowered shareholders at
Black Wattle, were integral in the success
in acquiring both of these reserves. As a
result, it was agreed that Vunani Mining
will share equally in any distributable
economic benefit from the coal reserves
as part of their non-controlling interest in
Black Wattle. This has been achieved
through a new shares issue in Black
Wattle that was completed subsequent to
year end on 12 April 2022. The total
issued share capital in Black Wattle
Colliery (Pty) Ltd was increased further
from 1000 shares to 1002 shares at par of
R1 through the following share issue:
•• a subscription of 1 “B” Share at par by
Bisichi Mining (Exploration Limited), a
100% subsidiary of the Group;
•• a subscription of 1 “B” Share at par by
Vunani Mining (Pty) Ltd
The “B” shares rank pari passu with the
ordinary shares save that they have sole
rights to the distributable profits
attributable to the above mining reserves
held by Black Wattle Colliery (Pty) Ltd. A
non-controlling interest is therefore
recognised for all profits distributable to
the “B” shares held by Vunani Mining (Pty)
Ltd from the date of issue of the shares
(12 April 2022).
Details of Vunani’s non-controlling interest
held at year end can be found in the
Non-controlling interest note on page 88.
UK property investment
Performance
The Group’s portfolio is managed actively
by London & Associated Properties plc.
Rental performance was marginally below
levels achieved in 2021. Net property
revenue (excluding joint ventures and
service charge income) across the
portfolio decreased during the year to
£1.119million (2020: £1.181million). The
property portfolio was externally valued
at 31 December 2021 and the value of UK
investment properties attributable to the
Group at year end increased to
£10.525million (2020: £10.270million)
mainly due to the reduced impact of
Covid-19.
Joint venture property investments
The Group holds a £0.6million (2020:
£0.7million) joint venture investment in
Dragon Retail Properties Limited, a UK
property investment company. The open
market value of the company’s share of
investment properties included within its
joint venture investment in Dragon Retail
Properties decreased marginally during
the year to £1.040million (2020:
£1.065million).
The following table summarises the main components of the consolidated cashflow for the year:
Year ended
31 December
2021
£’000
Year ended
31 December
2020
£’000
Cash flow generated from operations before working capital and other items 5,028 (1,111)
Cash flow from operating activities 4,432 449
Cash flow from investing activities (2,706) (4,292)
Cash flow from financing activities (271) (285)
Net (decrease) / increase in cash and cash equivalents 1,455 (4,128)
Cash and cash equivalents at 1 January (1,078) 2,878
Exchange adjustment 105 172
Cash and cash equivalents at 31 December 482 (1,078)
Cash and cash equivalents at 31 December comprise:
Cash and cash equivalents as presented in the balance sheet 3,018 3,768
Bank overdrafts (secured) (2,536) (4,846)
482 (1,078)
2121Bisichi PLC
Strategic Report Financial & performance review
The Group continues to hold a £0.5million
(2020: £0.6million) 50% joint venture
investment in West Ealing Projects
Limited, a UK unlisted property
development company. West Ealing
Projects Limited’s only asset is a property
development in West Ealing, London. The
carrying value of the Group’s share of the
trading property inventory included within
this development is valued at £3.7million
(2020: £3.5million). The joint venture has
obtained planning consent for a
residential development of 56 flats. We
look forward to updating shareholders
further in due course.
During the year the Group acquired a one
third joint venture investment holding in
Development Physics Limited, a UK
unlisted property development company.
The remaining two thirds is held equally by
London & Associated Properties PLC and
Metroprop Real Estate Ltd. The company
was set up with the purpose of delivering a
residential development of 44 flats and 4
town houses in Purley, London.
Development Physics acquired a series of
options on the site and has registered for
planning permission for its development. At
year end, the negative carrying value of the
investment held by the Group was £3,000
(2020: £Nil). We look forward to updating
shareholders further in due course.
Overall, the Group achieved net property
revenue of £1.2million (2020: £1.3million)
for the year which includes the company’s
share of net property revenue from its
investment in joint ventures of £88,000
(2020: £71,000).
Other Investments
During the year the Group’s non-current
investments held at fair value through
profit and loss increased from £1.7million
in 2020 to £3.6million due to net
additions during the year of £1.2million
(2020: £1.3million) and gains from
investments of £0.7million (2020:
£0.2million). The investments comprise of
£1.56million (2020: £0.96million)
investments listed on stock exchanges in
the United Kingdom and £2.07million
(2020: £0.79million) of investments listed
on overseas stock exchanges.
Cashflow & financial position
Cash flow generated from operating
activities increased compared to the prior
year to £4.4million (2020: £0.4million).
This can mainly be attributed to the
operating profit during the year of
£3.4million (2020: loss £4.5million) and a
positive cash movement attributable to a
decrease in stocks of £2.1million (2020:
cash decrease of £1.1million). This offset
an increase in trade receivables of
£1.9million (2020: decrease £0.1million).
All of the above can mainly be attributed
to the improved coal sales and revenue
per tonne achieved during the year.
Investing cashflows primarily reflect the
net effect of capital expenditure during
the year of £1.8million (2020: £3.2million)
which can mainly be attributable to mine
development costs at Black Wattle of
£1.6million (2020: £2.5million). As at year
end the Group’s mining reserves, plant
and equipment had a carrying value of
£9.0million (2020: £10.1 million) with
capital expenditure being offset by
depreciation of £2.5million (2020:
£2.2milion) and exchange translation
movements of £0.4million (2020:
£0.6million) for the year. Other investing
cashflows also include the net acquisition
of listed investments of £0.9million
(2020: £1.1million).
Cash outflows from financing activities
includes a net decrease in borrowings of
£0.3million (2020:£0.2million). In
addition, no dividends were paid to
shareholders during the year (2020:
£0.1million).
Overall, the Group’s cash and cash
equivalents increased during the year by
£1.5million (2020: decrease £4.1million).
After taking into account an exchange
gain of £0.1million (2020: £0.2million) on
the translation of the Group’s year end
net balance of cash and cash equivalents
that were held in South African Rands,
the Group’s net balance of cash and cash
equivalents (including bank overdrafts) at
year end was £0.5million (2020: negative
amount of £1.1million).
The Group has considerable financial
resources available at short notice
including cash and cash equivalents
(excluding bank overdrafts) of £3.0million
(2020: £3.8 million) and listed
investments of £4.3million (2020:
£2.6million) as at year end. The above
financial resources totalling £7.3million
(2020: £6.4million).
The net assets of the Group reported as
at year end were £17.8million (2020:
£16.2million) and total assets at
£38.1million (2020: £38.7million).
Liabilities decreased from £22.5million to
£20.3million during the year primarily due
to a decrease in current borrowings from
£5.1million to £2.7million. The overall
exchange loss recorded through the
translation reserve on translation of the
Group’s South African net assets at year
end decreased to £0.05million (2020:
£0.40million) as a result of the lower
weakening of the South African Rand
against UK sterling year to year.
Further details on the Group’s cashflow
and financial position are stated in the
Consolidated Cashflow Statement on
page 59 and the Consolidated Balance
Sheet on page 56 and 57.
22 Bisichi PLC
Strategic Report Financial & performance review
Loans
South Africa
The Group has a structured trade finance
facility with Absa Bank Limited for
R85million held by Sisonke Coal
Processing (Pty) Limited, a 100%
subsidiary of Black Wattle Colliery (Pty)
Limited. This facility comprises of an
R85million revolving facility to cover the
working capital requirements of the
Group’s South African operations. The
facility is renewable annually at 25
January and is secured against inventory,
debtors and cash that are held in the
Group’s South African operations.
United Kingdom
The Group holds a 5 year term facility of
£3.9m with Julian Hodge Bank Limited at
an initial LTV of 40%. The loan is secured
against the company’s UK retail property
portfolio. The amount repayable on the
loan at year end was £3.8million. The
debt package has a five year term and is
repayable at the end of the term in
December 2024. In the last quarter of
2021 the base interest rate on the loan
changed from LIBOR to the Bank of
England base rate. The overall interest
cost of the loan is 4.00% above the Bank
of England base rate. The loan is secured
by way of a first charge over the
investment properties in the UK which are
included in the financial statements at a
value of £10.5million. No banking
covenants were breached by the Group
during the year.
Statement regarding Section
172 of the UK Companies Act
Section 172 of the UK Companies Act
requires the Board to report on how the
directors have had regard to the matters
outlined below in performing their duties.
The Board consider the Group’s
customers, employees, local
communities, suppliers and shareholders
as key stakeholders of the Group. During
the year, the Directors consider that they
have acted in a way, and have made
decision that would, most likely promote
the success of the Group for the benefit
of its members as a whole as outlined in
the matters below:
• • The likely consequences of any
decision in the long term: see Principal
activity, strategy & business model on
page 4 and Principal Risks and
Uncertainties on page 11;
• • The interests of the Group’s employees;
ethics and compliance; fostering of the
Company’s business relationships with
suppliers, customers and others; and
the impact of the Group’s operations on
the community and environment: see
Sustainability report on page 7;
• • The need to act fairly between members
of the Company: see the Corporate
Governance section on page 26.
Future prospects
As mentioned in the Chairman’s statement,
In the first quarter of the year, we have
seen the API4 price average $238 and
exports from our South African operations
in the first quarter of 2022 have been in
line with the average export tonnages we
achieved in 2021. However, looking
beyond the first quarter, uncertainties
remain, particularly in regard to the
sustainability of the higher international
coal price and the impact of continued
constraints in transporting coal for export
on the South African rail network.
The Group continues to seek opportunities
to expand its operations in South Africa
through the acquisition of additional coal
reserves. In the UK, management is
looking forward to progressing its property
development opportunities in West Ealing
and Development Physics as well as
expanding on its equity investment
portfolio. This is in line with the Group’s
overall strategy of balancing the high risk
of our mining operations with a dependable
cash flow and capital appreciation from
our UK property investment operations
and equity investments.
To date, the Group’s financial position has
remained strong and at present, the
Group has adequate financial resources
to ensure the Group remains viable for
the foreseeable future and that liabilities
are met. A full going concern and viability
assessment can be found in the Directors
report on page 30.
Further information on the outlook of the
company can be found in both the
Chairman’s Statement on page 2 and the
Mining Review on page 5 which form part
of the Strategic Report.
Signed on behalf of the Board of Directors
Garrett Casey
Finance Director
13 April 2022
22
2323Bisichi PLC
Governance
* SIR MICHAEL HELLER
MA, FCA (Chairman)
ANDREW R HELLER
MA, ACA
(Managing Director)
GARRETT CASEY
CA (SA)
(Finance Director)
ROBERT GROBLER
Pr Cert Eng
(Director of mining)
O+
CHRISTOPHER A JOLL
MA (Non-executive)
Christopher Joll was appointed a
Director on 1 February 2001. He has
held a number of non-executive
directorships of quoted and un-quoted
companies and currently runs his own
event management business. He is also
a published author, lecturer and a writer
and director of documentary films.
O *
JOHN A SIBBALD
BL (Non-executive)
John Sibbald has been a Director
since 1988. After qualifying as a
Chartered Accountant he spent
over 20 years in stockbroking,
specialising in mining and
international investment.
JOHN WONG
ACA, CFA (Non-executive)
(Appointed 15 October 2020)
John Wong was appointed a
Director on 15 October 2020. After
training as a Chartered accountant
he has worked in the fund
management industry for almost 20
years and has extensive experience
in investment management, in
particular within the mining sector.
SECRETARY AND
REGISTERED OFFICE
Garrett Casey CA (SA)
BLACK WATTLE COLLIERY
AND SISONKE COAL
PROCESSING DIRECTORS
Andrew Heller
(Managing Director)
Ethan Dube
Robert Grobler
Garrett Casey
Millicent Zvarayi
COMPANY REGISTRATION
Company registration No.
112155 (Incorporated in
WEBSITE
www.bisichi.co.uk
E-MAIL
admin@bisichi.co.uk
AUDITOR
Kreston Reeves LLP,
London
PRINCIPAL BANKERS
United Kingdom
Julian Hodge Bank Limited
Santander UK PLC
Investec PLC
South Africa
ABSA Bank (SA)
First National Bank (SA)
CORPORATE SOLICITORS
United Kingdom
Ashfords LLP, London
Fladgate LLP, London
Olswang LLP, London
Wake Smith Solicitors
Limited, Sheffield
South Africa
Beech Veltman Inc,
Johannesburg
Brandmullers Attorneys,
Middelburg
Cliffe Decker Hofmeyer,
Johannesburg
Herbert Smith Freehills,
Johannesburg
Natalie Napier Inc,
Johannesburg
Tugendhaft Wapnick
Banchetti and Partners,
Johannesburg
STOCKBROKERS
Shore Capital Stockbrokers
Limited
REGISTRARS AND
TRANSFEROFFICE
Link Group
Shareholder Services
The Registry
10th Floor
Central Square
29 Wellington Street
Leeds
LS1 4DL
UK telephone:
0371 664 0300
Calls are charged at the standard
geographic rate and will vary by
provider. Calls outside the United
Kingdom will be charged at the
applicable international rate. The
helpline is open between 9.00 a.m.
– 5.30 p.m., Monday to Friday
excluding public holidays in
England and Wales.
Website: https://www.linkgroup.com/
Email: shareholderenquiries@
linkgroup.co.uk
Company registration number:
341829 (England and Wales)
MANAGEMENT TEAM OTHER DIRECTORS AND ADVISORS
* Member of the nomination committee
+ Senior independent director
O Member of the audit, nomination
andremuneration committees.
24 Bisichi PLC
Governance
2021
£’000
2020
£’000
2019
£’000
2018
£’000
2017
£’000
Consolidated income statement items
Revenue 50,520 29,805 48,106 49,945 40,350
Operating profit /(loss) 3,403 (4,493) 3,658 6,526 3,763
Profit/(Loss) before tax 2,501 (5,196) 3,027 5,959 1,485
Trading profit /(loss) before tax 1,559 (3,881) 4,493 6,397 3,317
Revaluation and impairment profit /(loss) before tax 942 (1,315) (1,466) (438) (1,832)
EBITDA 5,849 (2,387) 5,868 8,587 3,734
Operating profit before depreciation, fair value
adjustments and exchange movements (adjusted EBITDA)
5,028 (1,111) 7,457 9,088 5,819
Consolidated balance sheet items
Investment properties 10,525 10,270 11,565 13,045 13,245
Other non-current investments 4,761 3,001 1,629 1,357 925
15,286 13,271 13,194 14,402 14,170
Current Investments held at fair value 685 833 1,119 887 1,050
15,971 14,104 14,313 15,289 15,220
Other assets less liabilities less non-controlling interests 1,541 1,969 5,619 4,280 1,922
Total equity attributable to equity shareholders 17,512 16,073 19,932 19,569 17,142
Net assets per ordinary share (attributable) 164.0p 150,5p 186.7p 183.3p 160.6p
Dividend per share 6.00p 0p 1.00p 6.00p 5.00p
Financial calendar
16 June 2022 Annual General Meeting
Late August 2022 Announcement of half-year results to 30 June 2022
Late April 2023 Announcement of results for year ending 31 December 2022
Five year summary
2525Bisichi PLC
Governance
Review of business, future
developments and post
balance sheet events
The Group continues its mining activities.
Income for the year was derived from
sales of coal from its South African
operations. The Group also has a
property investment portfolio for which it
receives rental income and a joint venture
investment in a UK residential property
development.
The results for the year and state of
affairs of the Group and the company
at 31 December 2021 are shown on
pages 54 to 99 and in the Strategic
Report on pages 2 to 22. Future
developments and prospects are also
covered in the Strategic Report and
further details of any post balance sheet
events can be found in note 32 to the
financial statements. Over 98 per cent
of staff are employed in the South African
coal mining industry – employment
matters and health and safety are dealt
with in the Strategic Report.
The management report referred to in
the Director’s responsibilities statement
encompasses this Directors’ Report and
Strategic Report on pages 2 to 22.
Corporate responsibility
Environment
The environmental considerations of the
Group’s South African coal mining
operations are covered in the Strategic
Report on pages 2 to 22.
The Group’s UK activities are principally
property investment whereby premises
are provided for rent to retail businesses
and a joint venture investment in a UK
residential property development.
The Group seeks to provide those
tenants with good quality premises from
which they can operate in an efficient and
environmentally friendly manner.
Wherever possible, improvements, repairs
and replacements are made in an
environmentally efficient manner and
waste re-cycling arrangements are in
place at all the company’s locations.
Greenhouse Gas Emissions
Details of the Group’s greenhouse gas
emissions for the year ended 31
December 2021 can be found on page 10
of the Strategic Report.
Employment
The Group’s policy is to attract staff and
motivate employees by offering
competitive terms of employment. The
Group provides equal opportunities to all
employees and prospective employees
including those who are disabled. The
Strategic Report gives details of the
Group’s activities and policies concerning
the employment, training, health and
safety and community support and social
development concerning the Group’s
employees in South Africa.
Dividend policy
As outlined in the Strategic report on page
2 the directors are proposing the payment
of a dividend of 4p (2020: 0p) and a
special dividend of 2p (2020: Nil) per
share for 2021. No interim dividend for
2021 has been paid (Interim 2020: 0p).
The total dividend per ordinary share for
2021 will therefore be 6p (2020: 0p) per
ordinary share.
Investment properties and
other properties
The investment property portfolio is
stated at its open market value of
£10,525,000 at 31 December 2021
(2020: £10,270,000) as valued by
professional external valuers. The open
market value of the company’s share of
investment properties and development
property inventory held at cost included
within its investments in joint ventures is
£4,787,000 (2020: £4,597,000).
Financial instruments
Note 22 to the financial statements sets
out the risks in respect of financial
instruments. The Board reviews and
agrees overall treasury policies,
delegating appropriate authority to the
managing director. Treasury operations
are reported at each Board meeting and
are subject to weekly internal reporting.
Directors
The directors of the company for the year
were Sir Michael Heller, A R Heller, G J
Casey, C A Joll, R J Grobler (a South
African citizen), J A Sibbald and J Wong.
The directors retiring by rotation are Sir M
A Heller, Mr C A Joll and Mr J A Sibbald
who offers themselves for re-election.
Sir Michael Heller has been an executive
Director since 1972 and Chairman since
1981. He is a Chartered Accountant and
has a contract of employment
determinable at six months’ notice.
Directors’ report
The directors submit their report together with the audited financial
statements for the year ended 31 December 2021.
26 Bisichi PLC
Christopher Joll was appointed a Director
on 1 February 2001. He has held a number
of non-executive directorships of quoted
and un-quoted companies and currently
runs his own event management business.
He is also a published author, lecturer and
a writer and director of documentary films.
John Sibbald has been a non-executive
Director since 1988. He is a retired
Chartered Accountant. For most of his
career he was employed in stockbroking
in the City of London where he
specialised in mining and international
investment. He has a contract of service
determinable at three months’ notice.
No director had any material interest in
any contract or arrangement with the
company during the year other than as
shown in this report.
Directors’ shareholdings
The interests of the directors in the
shares of the company, including family
and trustee holdings where appropriate,
are shown on page 34 of the Annual
Remuneration Report.
Substantial interests
The following have advised that they have
an interest in 3 per cent. or more of the
issued share capital of the company as at
13 April 2022:
London & Associated Properties PLC –
4,432,618 shares representing 41.52 per
cent. of the issued capital. (Sir Michael
Heller is a director and shareholder of
London & Associated Properties PLC).
Sir Michael
Heller
330,117 shares
representing 3.09 per
cent. of the issued capital.
A R Heller 785,012 shares
representing 7.35 per
cent. of the issued capital.
Stonehage
Fleming
Investment
Management
Ltd –
1,981,154 shares
representing 18.56 per
cent. of the issued share
capital.
James Hyslop 345,000 shares
representing 3.23 per
cent. of the issued share
capital.
Disclosure of information to
auditor
The directors in office at the date of
approval of the financial statements have
confirmed that as far as they are aware
that there is no relevant audit information
of which the auditor is unaware. Each of
the directors has confirmed that they
have taken all reasonable steps they
ought to have taken as directors to make
themselves aware of any relevant audit
information and to establish that it has
been communicated to the auditor.
Indemnities and insurance
The Articles of Association and
Constitution of the company provide for
them to indemnify, to the extent permitted
by law, directors and officers (excluding
the Auditor) of the companies, including
officers of subsidiaries, and associated
companies against liabilities arising from
the conduct of the Group’s business. The
indemnities are qualifying third-party
indemnity provisions for the purposes of
the UK Companies Act 2006 and each of
these qualifying third-party indemnities
was in force during the course of the
financial year ended 31 December 2021
and as at the date of this Directors’
report. No amount has been paid under
any of these indemnities during the year.
The Group has purchased directors’ and
officers’ insurance during the year. In
broad terms, the insurance cover
indemnifies individual directors and
officers against certain personal legal
liability and legal defence costs for claims
arising out of actions taken in connection
with Group business.
Corporate Governance
The Board acknowledges the importance of
good corporate governance. The
paragraphs below set out how the company
has applied this guidance during the year.
Principles of corporate
governance
The Group’s Board appreciates the value
of good corporate governance not only in
the areas of accountability and risk
management, but also as a positive
contribution to business prosperity. The
Board endeavours to apply corporate
governance principles in a sensible and
pragmatic fashion having regard to the
circumstances of the Group’s business.
The key objective is to enhance and
protect shareholder value.
Board structure
During the year the Board comprised the
executive chairman, the managing
director, two other executive directors
and three non-executive directors. Their
details appear on page 23. The Board is
responsible to shareholders for the
proper management of the Group. The
Directors’ responsibilities statement in
respect of the accounts is set out on
page 43. The non-executive directors
have a particular responsibility to ensure
that the strategies proposed by the
executive directors are fully considered.
Governance Directors’ report
2727Bisichi PLC
To enable the Board to discharge its duties,
all directors have full and timely access to all
relevant information and there is a
procedure for all directors, in furtherance of
their duties, to take independent
professional advice, if necessary, at the
expense of the Group. The Board has a
formal schedule of matters reserved to it
and meets bi-monthly.
The Board is responsible for overall Group
strategy, approval of major capital
expenditure projects and consideration of
significant financing matters.
The following Board committees, which
have written terms of reference, deal with
specific aspects of the Group’s affairs:
• • The nomination committee comprises of
two non-executive directors C A Joll
(Chairman) and JA Sibbald as well as the
executive chairman. The committee is
responsible for proposing candidates for
appointment to the Board, having regard
to the balance and structure of the
Board. In appropriate cases recruitment
consultants are used to assist the
process. Each director is subject to
re-election at least every three years.
• • The remuneration committee is
responsible for making recommendations
to the Board on the company’s
framework of executive remuneration and
its cost. The committee determines the
contractual terms, remuneration and
other benefits for each of the executive
directors, including performance related
bonus schemes, pension rights and
compensation payments. The Board itself
determines the remuneration of the
non-executive directors. The committee
comprises of two non-executive directors
C A Joll (Chairman) and JA Sibbald. The
company’s executive chairman is
normally invited to attend meetings. The
report on directors’ remuneration is set
out on pages 32 to 39.
• • The audit committee comprises of two
non-executive directors C A Joll
(Chairman) and JA Sibbald. Its prime
tasks are to review the scope of external
audit, to receive regular reports from the
company’s auditor and to review the
half-yearly and annual accounts before
they are presented to the Board,
focusing in particular on accounting
policies and areas of management
judgment and estimation. The committee
is responsible for monitoring the controls
which are in force to ensure the integrity
of the information reported to the
shareholders. The committee acts as a
forum for discussion of internal control
issues and contributes to the Board’s
review of the effectiveness of the
Group’s internal control and risk
management systems and processes.
The committee also considers annually
the need for an internal audit function. It
advises the Board on the appointment of
external auditors and on their
remuneration for both audit and
non-audit work, and discusses the
nature and scope of the audit with the
external auditors. The committee, which
meets formally at least twice a year,
provides a forum for reporting by the
Group’s external auditors.
Meetings are also attended, by invitation,
by the company chairman, managing
director and finance director.
The audit committee also undertakes a
formal assessment of the auditors’
independence each year which includes:
• • a review of non-audit services provided
to the Group and related fees;
• • discussion with the auditors of a written
report detailing consideration of any
matters that could affect independence
or the perception of independence;
• • a review of the auditors’ own procedures
for ensuring the independence of the
audit firm and partners and staff involved
in the audit, including the regular rotation
of the audit partner; and
• • obtaining written confirmation from the
auditors that, in their professional
judgement, they are independent.
The audit committee report is set out on
page 40.
An analysis of the fees payable to the
external audit firm in respect of both audit
and non-audit services during the year is
set out in Note 5 to the financial statements.
Performance evaluation –
board, board committees and
directors
The performance of the board as a whole
and of its committees and the non-
executive directors is assessed by the
chairman and the managing director and
is discussed with the senior independent
director. Their recommendations are
discussed at the nomination committee
prior to proposals for re-election being
recommended to the Board. The
performance of executive directors is
discussed and assessed by the
remuneration committee. The senior
independent director meets regularly with
the chairman and both the executive and
non-executive directors individually
outside of formal meetings. The directors
will take outside advice in reviewing
performance but have not found this
necessary to date.
Governance Directors’ report
28 Bisichi PLC
Independent directors
The senior independent non-executive
director is Christopher Joll. The other two
independent non-executive directors are
John Sibbald and John Wong.
Christopher Joll has been a non-
executive director for over twenty years,
John Sibbald has been a non-executive
director for over thirty years and John
Wong was appointed to the Board on 15
October 2020. The Board encourages
the non-executive directors to act
independently. The board considers that
their length of service does not, and has
not, resulted in their inability or failure to
act independently. In the opinion of the
Board, Christopher Joll and John Sibbald
continue to fulfil their role as independent
non-executive directors.
The independent directors regularly meet
prior to Board meetings to discuss
corporate governance issues.
Meetings
held
Meetings
Attended
Sir Michael Heller Board
Nomination committee
Audit committee
5
1
2
5
1
2
A R Heller Board
Audit committee
5
2
5
2
G J Casey Board
Audit committee
5
2
5
2
R J Grobler Board 5 1
C A Joll Board
Audit committee
Nomination committee
Remuneration committee
5
2
1
1
5
2
1
1
J A Sibbald Board
Audit committee
Nomination committee
Remuneration committee
5
2
1
1
2
0
1
0
J Wong Board 5 1
Board and board committee meetings
The number of meetings during 2021 and attendance at regular Board meetings and
Board committees was as follows:
Internal control
The directors are responsible for the
Group’s system of internal control and
review of its effectiveness annually. The
Board has designed the Group’s system of
internal control in order to provide the
directors with reasonable assurance that its
assets are safeguarded, that transactions
are authorised and properly recorded and
that material errors and irregularities are
either prevented or would be detected
within a timely period. However, no system
of internal control can eliminate the risk of
failure to achieve business objectives or
provide absolute assurance against
material misstatement or loss.
The key elements of the control system in
operation are:
• • the Board meets regularly with a formal
schedule of matters reserved to it for
decision and has put in place an
organisational structure with clearly
defined lines of responsibility and with
appropriate delegation of authority;
• • there are established procedures for
planning, approval and monitoring of
capital expenditure and information
systems for monitoring the Group’s
financial performance against approved
budgets and forecasts;
• • UK property and financial operations are
closely monitored by members of the
Board and senior managers to enable
them to assess risk and address the
adequacy of measures in place for its
monitoring and control. The South
African operations are closely supervised
by the UK based executives through
daily, weekly and monthly reports from
the directors and senior officers in South
Africa. This is supplemented by regular
visits by the UK based finance director to
the South African operations which
include checking the integrity of
information supplied to the UK. The
directors are guided by the internal
control guidance for directors issued by
the Institute of Chartered Accountants in
England and Wales.
During the period, the audit committee has
reviewed the effectiveness of internal
control as described above. The Board
receives periodic reports from its
committees.
There were no significant issues identified
during the year ended 31 December 2021
(and up to the date of approval of the
report) concerning material internal control
issues. The directors confirm that the
Board has reviewed the effectiveness of the
system of internal control as described
during the period.
Governance Directors’ report
2929Bisichi PLC
Communication with
shareholders
Communication with shareholders is a
matter of priority. Extensive information
about the Group and its activities is given
in the Annual Report, which is made
available to shareholders. Further
information is available on the company’s
website, www.bisichi.co.uk. There is a
regular dialogue with institutional
investors. Enquiries from individuals on
matters relating to their shareholdings
and the business of the Group are dealt
with informatively and promptly.
Takeover directive
The company has one class of share
capital, ordinary shares. Each ordinary
share carries one vote. All the ordinary
shares rank pari passu. There are no
securities issued in the company which
carry special rights with regard to control of
the company. The identity of all substantial
direct or indirect holders of securities in the
company and the size and nature of their
holdings is shown under the “Substantial
interests” section of this report above.
A relationship agreement dated 15
September 2005 (the “Relationship
Agreement”) was entered into between the
company and London & Associated
Properties PLC (“LAP”) in regard to the
arrangements between them whilst LAP is
a controlling shareholder of the company.
The Relationship Agreement includes a
provision under which LAP has agreed to
exercise the voting rights attached to the
ordinary shares in the company owned by
LAP to ensure the independence of the
Board of directors of the company.
Other than the restrictions contained in the
Relationship Agreement, there are no
restrictions on voting rights or on the
transfer of ordinary shares in the company.
The rules governing the appointment and
replacement of directors, alteration of the
articles of association of the company and
the powers of the company’s directors
accord with usual English company law
provisions. Each director is re-elected at
least every three years. The company is not
party to any significant agreements that
take effect, alter or terminate upon a
change of control of the company following
a takeover bid. The company is not aware
of any agreements between holders of its
ordinary shares that may result in
restrictions on the transfer of its ordinary
shares or on voting rights.
There are no agreements between the
company and its directors or employees
providing for compensation for loss of
office or employment that occurs because
of a takeover bid.
The Bribery Act 2010
The Bribery Act 2010 came into force on
1 July 2011, and the Board took the
opportunity to implement a new Anti-
Bribery Policy. The company is committed
to acting ethically, fairly and with integrity
in all its endeavours and compliance of
the code is closely monitored.
Annual General Meeting
The annual general meeting of the company
(“Annual General Meeting”) will be held at
Meeting Room 2, 12 Charles II Street, St
James, London SW1Y 4QU on Thursday,
16 June 2022 at 11.00 a.m. Resolutions
1 to 10 will be proposed as ordinary
resolutions. More than 50 per cent. of
shareholders’ votes cast must be in
favour for those resolutions to be passed.
The directors consider that all of the
resolutions to be put to the meeting are in
the best interests of the company and its
shareholders as a whole. The Board
recommends that shareholders vote in
favour of all resolutions.
Please note that the following paragraph
is a summary of resolution 10 to be
proposed at the Annual General Meeting
and not the full text of the resolution. You
should therefore read this section in
conjunction with the full text of the
resolutions contained in the notice of
Annual General Meeting.
Directors’ authority to allot
shares (Resolution 10)
In certain circumstances it is important
for the company to be able to allot shares
up to a maximum amount without
needing to seek shareholder approval
every time an allotment is required.
Paragraph 10.1.1 of resolution 10 would
give the directors the authority to allot
shares in the company and grant rights
to subscribe for, or convert any security
into, shares in the company up to an
aggregate nominal value of £355,894.
This represents approximately 1/3 (one
third) of the ordinary share capital of the
company in issue (excluding treasury
shares) at 13 April 2022 (being the last
practicable date prior to the publication
of this Directors’ Report). Paragraph
10.1.2 of resolution 10 would give the
directors the authority to allot shares in
the company and grant rights to
subscribe for, or convert any security
into, shares in the company up to a
further aggregate nominal value of
£355,894, in connection with a pre-
emptive rights issue. This amount
represents approximately 1/3 (one third)
of the ordinary share capital of the
company in issue (excluding treasury
shares) at 13 April 2022 (being the last
practicable date prior to the publication
of this Directors’ Report).
Therefore, the maximum nominal value
of shares or rights to subscribe for, or
convert any security into, shares which
may be allotted or granted under resolution
10 is £711,788. Resolution 10 complies
with guidance issued by the Investment
Association (IA).
The authority granted by resolution 109
will expire on 31 August 2023 or, if earlier,
the conclusion of the next annual general
meeting of the company. The directors
have no present intention to make use of
this authority. However, if they do exercise
the authority, the directors intend to
follow emerging best practice as regards
its use as recommended by the IA.
Governance Directors’ report
30 Bisichi PLC
Donations
No political donations were made during
the year (2020: £nil).
Going concern
The Group’s business activities, together
with the factors likely to affect its future
development are set out in the
Chairman’s Statement on the preceding
page 2, the Mining Review on pages 5 to
6 and its financial position is set out on
page 21 of the Strategic Report. In
addition Note 22 to the financial
statements includes the Group’s treasury
policy, interest rate risk, liquidity risk,
foreign exchange risks and credit risk.
In South Africa, a structured trade finance
facility with Absa Bank Limited for
R85million is held by Sisonke Coal
Processing (Pty) Limited, a 100%
subsidiary of Black Wattle Colliery (Pty)
Limited. This facility comprises of a
R85million revolving facility to cover the
working capital requirements of the
Group’s South African operations. The
facility is renewable annually at 25
January and is secured against inventory,
debtors and cash that are held in the
Group’s South African operations. The
Directors do not foresee any reason why
the facility will not continue to be renewed
at the next renewal date, in line with prior
periods and based on their banking
relationships.
The directors expect that the coal market
conditions experienced by its South
African coal mining and processing
operations in 2021 will be similar going
into 2022. The directors therefore have a
reasonable expectation that the mine will
achieve positive levels of cash generation
for the Group in 2022. As a
consequence, the directors believe that
the Group is well placed to manage its
South African business risks successfully.
In the UK, forecasts demonstrate that the
Group has sufficient resources to meet
its liabilities as they fall due for at least
the next 12 months, from the approval of
the financial statements, including those
related to the Group’s UK Loan facility
outlined below.
The Group holds a 5 year term facility of
£3.9m with Julian Hodge Bank Limited at
an initial LTV of 40%. The loan is secured
against the company’s UK retail property
portfolio. The amount repayable on the
loan at year end was £3.9million. The
debt package has a five year term and is
repayable at the end of the term in
December 2024. In the last quarter of
2021 the base interest rate on the loan
changed from LIBOR to the Bank of
England base rate. The overall interest
cost of the loan is 4.00% above the Bank
of England base rate. All covenants on
the loan were met during the year and the
directors have a reasonable expectation
that the Group has adequate financial
resources at short notice, including cash
and listed equity investments, to ensure
the existing facility’s covenants are met
on an ongoing basis.
Dragon Retail Properties Limited
(“Dragon”), the Group’s 50% owned joint
venture, holds a Santander bank loan of
£1.2million secured against its investment
property, see note 14. The bank loan of
£1.164million is secured by way of a first
charge on specific freehold property at a
value of £2.08 million. The interest cost
of the loan is 2.75 per cent above the
bank’s base rate. A refinancing of this
loan is currently underway. The loan
originally expired in October 2020 but
has been extended to April 2022, and the
lender has offered to extend this further if
required. Dragon has agreed terms with a
new lender to refinance this loan in full
and are expecting to complete this
shortly.
Subsequent to year end in the first
quarter of 2022 geo-political events in
Ukraine resulted in higher global energy
prices. Although the final outcome of the
events in Ukraine is uncertain, the
Directors at present do not foresee the
events having a significant negative
impact on the Group’s UK and South
African operations ability to remain in
operation for the foreseeable future.
Detailed budget and cash flow forecasts
for the Group’s operations demonstrated
that the Group has sufficient resources to
meet its liabilities as they fall due for at
least the next 12 months and the
Directors believe the Group would be able
to manage its business risks and have
adequate cash resources to continue in
operational existence for the foreseeable
future. As a result of the banking facilities
held as well as the acceptable levels of
cash expected to be held by the Group
over the next 12 months, the Directors
believe that the Group has adequate
resources to continue in operational
existence for the foreseeable future and
that the Group is well placed to manage
its business risks. Thus they continue to
adopt the going concern basis of
accounting in preparing the annual
financial statements.
By order of the board
G.J Casey
Secretary
12 Little Portland Street
London W1W8BJ
13 April 2022
Governance Directors’ report
3131Bisichi PLC
Governance
The first part is the Annual Remuneration
Report which details remuneration
awarded to Directors and non-executive
Directors during the year. The shareholders
will be asked to approve the Annual
Remuneration Report as an ordinary
resolution (as in previous years) at the
AGM in June 2022. During the year, in light
of the performance of the Group, the
board determined to award bonuses to
certain executive directors of the Group.
The second part is the Remuneration
Policy which details the remuneration
policy for Directors, and can be found at
www.bisichi.co.uk. The current
remuneration policy was subject to a
binding vote which was approved by
shareholders at the AGM in July 2020.
The approval will continue to apply for a 3
year period commencing from then. The
committee reviewed the existing policy
and deemed that no changes were
necessary to the current arrangements.
Both of the above reports have been
prepared in accordance with The Large &
Medium-sized Companies and Groups
(Accounts and Reports) (Amendment)
Regulations 2013.
The company’s auditors, Kreston reeves
LLP are required by law to audit certain
disclosures and where disclosures have
been audited they are indicated as such.
Christopher Joll
Chairman – remuneration committee
12 Little Portland Street
London W1W8BJ
13 April 2022
Statement of the Chairman of
the remuneration committee
The remuneration committee presents its report for the year
ended 31 December 2021. The report is presented in two parts
in accordance with the remuneration regulations.
32 Bisichi PLC
Governance
The following information has been audited:
Single total figure of remuneration for the year ended 31 December 2021:
Salaries
and Fees
£’000
Benefits
£’000
Bonuses
£’000
Long Term
Incentive
Awards
£’000
Pension
£’000
Total
2021
£’000
Total
Fixed
Remuner-
ation
£’000
Total
Variable
Remuner-
ation
£’000
Executive Directors
Sir Michael Heller 83 - - - - 83 83 -
A R Heller 495 34 400 - - 929 529 400
G J Casey 185 17 200 - 19 421 221 200
R Grobler 205 11 176 - 17 409 233 176
Non–Executive Directors
C A Joll* 40 - - - - 40 40 -
J A Sibbald* 3 3 - - - 6 6 -
J Wong (appointed 15 October
2021)
50 - - - - 50 50 -
Total 1,061 65 776 - 36 1,938 1,162 776
*Members of the remuneration committee for the year ended 31 December 2021
Single total figure of remuneration for the year ended 31 December 2020:
Salaries
and Fees
£’000
Benefits
£’000
Bonuses
£’000
Long Term
Incentive
Awards
£’000
Pension
£’000
Total
2020
£’000
Total
Fixed
Remuner-
ation
£’000
Total
Variable
Remuner-
ation
£’000
Executive Directors
Sir Michael Heller 83 - - - - 83 83 -
A R Heller 495 56 - - - 551 551 -
G J Casey 154 20 - - 11 185 185 -
R Grobler 193 10 - - 16 219 219 -
Non–Executive Directors
C A Joll* 40 - - - - 40 40 -
J A Sibbald* 3 3 - - - 6 6 -
J Wong (appointed 15 October
2020)
12 - - - - 12 12 -
Total 980 88 - - 27 1,096 1,096 -
*Members of the remuneration committee for the year ended 31 December 2020
Annual remuneration report
3333Bisichi PLC
Governance Annual remuneration report
Summary of directors’ terms
Date of
contract
Unexpired
term
Notice
period
Executive directors
Sir Michael Heller November 1972 Continuous 6 months
A R Heller January 1994 Continuous 3 months
G J Casey June 2010 Continuous 3 months
R J Grobler April 2008 Continuous 3 months
Non-executive directors
C A Joll February 2001 Continuous 3 months
J A Sibbald October 1988 Continuous 3 months
J Wong October 2020 Continuous 3 months
Pension schemes and incentives
Two (2020: Two) directors have benefits under money purchase pension schemes. Contributions in 2021 were £35,177 (2020:
£27,323), see table above. There are no additional benefits payable to any director in the event of early retirement.
Scheme interests awarded during the year
During the year no share options were granted under share option schemes.
Share option schemes
The company currently has only one Unapproved Share Option Scheme which is not subject to HM revenue and Customs (HMRC)
approval. The 2012 scheme was approved by the remuneration committee of the company on 28 September 2012.
Number of share options
Option
price*
1 January
2021
Options
granted/
(Surren-
dered)
in
2021
31
December
2021
Exercisable
from
Exercisable
to
The 2012 Scheme
A R Heller 87.01p 150,000 - 150,000 18/09/2015 17/09/2025
A R Heller 73.50p 150,000 - 150,000 06/02/2018 06/02/2028
G J Casey 87.01p 150,000 - 150,000 18/09/2015 17/09/2025
G J Casey 73.50p 230,000 - 230,000 06/02/2018 06/02/2028
*Middle market price at date of grant
No consideration is payable for the grant of options under the 2012 Unapproved Share Option Scheme. There are no performance
or service conditions attached to the 2012 Unapproved Share Option scheme. No part of the award was attributable to share price
appreciation and no discretion has been exercised as a result of share price appreciation or depreciation. During the year, there
were no changes to the exercise price or exercise period for the options.
34 Bisichi PLC
Governance Annual remuneration report
Payments to past directors
No payments were made to past directors in the year ended 31 December 2021 (2020: £nil).
Payments for loss of office
No payments for loss of office were made in the year ended 31 December 2021 (2020: £nil).
Statement of Directors’ shareholding and share interest
Directors’ interests
The interests of the directors in the shares of the company, including family and trustee holdings where appropriate, were as follows:
Beneficial Non-beneficial
31.12.2021 1.1.2021 31.12.2021 1.1.2021
Sir Michael Heller 148,783 148,783 181,334 181,334
A R Heller 785,012 785,012 - -
R J Grobler - - - -
G J Casey 40,000 40,000 - -
C A Joll - - - -
J A Sibbald - - - -
J Wong - - - -
There are no requirements or guidelines for any director to own shares in the Company.
The following section is
unaudited.
The following graph illustrates the
company’s performance compared
with a broad equity market index over
a ten year period. Performance is
measured by total shareholder return.
The directors have chosen the FTSE
All Share Mining index as a suitable
index for this comparison as it gives
an indication of performance against
a spread of quoted companies in the
same sector.
The middle market price of Bisichi
PLC ordinary shares at 31 December
2021 was 60p (2020: 109p). During
the year the share price ranged
between 45p and 120p.
160.00
140.00
120.00
100.00
80.00
60.00
40.00
20.00
2012 2013 2014 2015 2016 2017 2018 2019 2020
–
Bisichi Mining
–
FTSE All Share
Share Price (rebased)
3535Bisichi PLC
Governance Annual remuneration report
Year
Managing
Director
Managing
Director
Single total
figure of
remuneration
£’000
Annual
bonus
payout
against
maximum
opportunity*
%
Long-term
incentive
vesting rates
against
maximum
opportunity*
%
2021 A R Heller 929 27% N/A
2020 A R Heller 551 0% N/A
2019 A R Heller 1,035 34% N/A
2018 A R Heller 1,073 34% N/A
2017 A R Heller 898 25% N/A
2016 A R Heller 850 22% N/A
2015 A R Heller 912 22% N/A
2014 A R Heller 862 22% N/A
2013 A R Heller 614 N/A N/A
2012 A R Heller 721 N/A N/A
Bisichi PLC does not have a Chief Executive so the table includes the equivalent information for the Managing Director.
*There were no formal criteria or conditions to apply in determining the amount of bonus payable or the number of shares to be issued prior to 2014.
Percentage change in remuneration and Company performance
Director
Base Salary
% Change
2021 v 2020
Benefits
% Change
2021 v 2020
Bonuses
% Change
2021 v 2020
Executive:
Sir Michael Heller 0% 0% 0%
A R Heller
1
0% (39%) N/A
G J Casey
1
20% (10%) N/A
R Grobler
1
6% 3% N/A
Non-Executive:
C A Joll 0% 0% 0%
J A Sibbald 0% 0% 0%
J Wong
2
0% 0% 0%
Employee remuneration on a full-time equivalent basis:
Employees of the Company
1&3
8% (26%) N/A
1 Bonus changes from 2021 to 2020 for AR Heller, G J Casey, R Grobler and Employees of the Company are disclosed as not applicable as no bonuses were
awarded to the various directors and employees in 2020.
2 Mr J Wong was appointed as a non-executive Director on 15 October 2020 so the annual change is apportioned.
3 The comparator group chosen is all UK based employees as the remuneration committee believe this provides the most accurate comparison of underlying
increases based on similar annual bonus performances utilised by the Group.
Remuneration of the Managing Director over the last ten years
The table below demonstrates the remuneration of the holder of the office of
Managing Director for the last ten years for the period from 1 January 2012
to 31 December 2021.
36 Bisichi PLC
Governance Annual remuneration report
Relative importance of spend on pay
The total expenditure of the Group on remuneration to all employees (see Notes 29 and 9 to the financial statements) is shown below:
2021
£’000
2020
£’000
Employee remuneration 7,491 5,890
Distribution to shareholders (see note below) 641 -
The distribution to shareholders in the current year is subject to shareholder approval at next the Annual General Meeting.
Statement of implementation of remuneration policy
The remuneration policy was approved at the AGM on 9 July 2020. The policy took effect from the conclusion of the AGM and will
apply for 3 years unless changes are deemed necessary by the remuneration committee. The company may not make a
remuneration payment or payment for loss of office to a person who is, is to be, or has been a director of the company unless that
payment is consistent with the approved remuneration policy, or has otherwise been approved by a resolution of members. During
the year, there were no deviations from the procedure for the implementation of the remuneration policy as set out in the policy.
Consideration by the directors of matters relating to directors’ remuneration
The remuneration committee considered the executive directors remuneration and the board considered the non-executive
directors remuneration in the year ended 31 December 2021. The Company did not engage any consultants to provide advice or
services to materially assist the remuneration committee’s considerations.
Shareholder voting
At the Annual General Meeting on 22 June 2021, there was an advisory vote on the resolution to approve the remuneration report,
other than the part containing the remuneration policy. In addition, on 9 July 2020 there was a binding vote on the resolution to
approve the current remuneration policy the results of which are detailed below:
% of votes
for
% of votes
against
No of votes
withheld
Resolution to approve the Remuneration Report (22 June 2021) 72.05% 27.95% -
Resolution to approve the Remuneration Policy (9 July 2020) 69.87% 30.13% -
The remuneration committee and directors have considered the percentage of votes against the resolutions to approve the
remuneration report and policy. Reasons given by shareholders, as known by the directors, have been the level of remuneration
awarded and the general remuneration policy itself. The remuneration committee consider the remuneration policy and
performance conditions within remain appropriate and therefore no further action has been taken.
Service contracts
All executive directors have full-time contracts of employment with the company. Non-executive directors have contracts of service.
No director has a contract of employment or contract of service with the company, its joint venture or associated companies with a
fixed term which exceeds twelve months. Directors notice periods (see page 33 of the annual remuneration report) are set in line
with market practice and of a length considered sufficient to ensure an effective handover of duties should a director leave the
company.
All directors’ contracts as amended from time to time, have run from the date of appointment. Service contracts are kept at the
registered office.
3737Bisichi PLC
Governance Annual remuneration report
Remuneration policy table
The remuneration policy table below is an extract of the Group’s current remuneration policy on directors’ remuneration, which was
approved by a binding vote at the 2020 AGM. The approved policy took effect from 9 July 2020. A copy of the full policy can be
found at www.bisichi.co.uk.
Element Purpose Policy Operation
Opportunity and performance
conditions
Executive directors
Base
salary
To recognise:
Skills
Responsibility
Accountability
Experience
Value
Considered by remuneration
committee on appointment.
Set at a level considered
appropriate to attract, retain
motivate and reward the
right individuals.
Reviewed annually
Paid monthly in cash
No individual director will be awarded
a base salary in excess of £700,000
per annum.
No specific performance conditions
are attached to base salaries.
Pension
To provide
competitive
retirement
benefits
Company contribution
offered at up to 10% of
base salary as part of overall
remuneration package.
The contribution payable
by the company is included
in the
director’s contract of
employment.
Paid into money purchase
schemes
Company contribution offered at up to
10% of base salary as part of overall
remuneration package.
No specific performance conditions
are attached to pension contributions.
Benefits
To provide a
competitive
benefits package
Contractual benefits can
include but are not limited to:
Car or car allowance
Group health cover
Death in service cover
Permanent health insurance
The committee retains
absolute discretion to
approve changes in
contractual benefits in
exceptional circumstances
or where factors outside
the control of the Group
lead to increased costs (e.g.
medical inflation)
The costs associated with benefits
offered are closely controlled and
reviewed on an annual basis.
No director will receive benefits of a
value in excess of 30% of his base
salary.
No specific performance conditions
are attached to contractual benefits.
The value of benefits for each director
for the year ended 31 December 2021
is shown in the table on page 32.
38 Bisichi PLC
Governance Annual remuneration report
Element Purpose Policy Operation Opportunity and performance conditions
Annual
Bonus
To reward and
incentivise
In assessing the
performance of the
executive team,
and in particular to
determine whether
bonuses are merited
the remuneration
committee takes
into account the
overall performance
of the business.
Bonuses are
generally offered in
cash
The remuneration
committee
determines the
level of bonus on
an annual basis
applying such
performance
conditions and
performance
measures as
it considers
appropriate
The current maximum bonus opportunity will not
exceed 200% of base salary in any one year, but the
remuneration committee reserves the power to award
up to 300% in an exceptional year.
There is no formal framework by which the company
assesses performance and performance conditions
and measures will be assessed on an annual basis
by the remuneration committee. In determining the
level of the bonus, the remuneration committee will
take into account internal and external factors and
circumstances that occur during the year under
review. The performance measures applied may
be financial, non-financial, corporate, divisional or
individual and in such proportion as the remuneration
committee considers appropriate to the prevailing
circumstances. The company does not consider,
given the company’s size, nature and stage of
operations that a formal framework is required.
Share
Options
To provide executive
directors with a
long-term interest in
the company
Granted under
existing schemes
(see page 33)
Offered at
appropriate times
by the remuneration
committee
Entitlement to share options is not subject to any
specific performance conditions.
Share options will be offered by the remuneration
committee as appropriate taking into account the
factors considered above in the decision making
process in determining remuneration policy.
The aggregate number of shares over which options
may be granted under all of the company’s option
schemes (including any options and awards granted
under the company’s employee share plans) in any
period of ten years, will not exceed, at the time of
grant, 10% of the ordinary share capital of the
company from time to time. In determining the limits
no account shall be taken of any shares where
the right to acquire the shares has been released,
lapsed or has otherwise become incapable of
exercise.
The company currently has one Share Option
Scheme (see page 33). For the 2012 scheme the
remuneration committee has the ability to impose
performance criteria in respect of any new share
options granted, however there is no requirement
to do so. There are no performance conditions
attached to the options already issued under the
2012 scheme, the options vest on issue and there
are no minimum hold periods for the resulting
shares issued on exercise of the option.
3939Bisichi PLC
Element Purpose Policy Operation Opportunity and performance conditions
Non-executive directors
Base
salary
To recognise:
Skills
Experience
Value
Considered by
the board on
appointment.
Set at a level
considered
appropriate to
attract, retain
and motivate the
individual.
Experience and
time required
for the role are
considered on
appointment.
Reviewed annually No individual director will be awarded a base salary in excess of
£60,000 per annum.
No specific performance conditions are attached to base
salaries.
Pension No pension offered
Benefits No benefits offered
except
to one non-
executive director
who is eligible for
health
cover (see annual
remuneration
report
page 32)
The committee
retains the
discretion to
approve changes in
contractual benefits
in exceptional
circumstances
or where factors
outside the control
of the Group lead to
increased costs (e.g.
medical inflation)
The costs associated with the benefit offered is closely
controlled and reviewed on an annual basis.
No director will receive benefits of a value in excess of 30% of
his base salary.
No specific performance conditions are attached to contractual
benefits.
Share
Options
Non-executive
directors do not
participate in
the share option
schemes
In order to ensure that shareholders have sufficient clarity over director remuneration levels, the company has, where possible,
specified a maximum that may be paid to a director in respect of each component of remuneration. The remuneration committee
consider the performance measures outlined in the table above to be appropriate measures of performance and that the KPI’s
chosen align the interests of the directors and shareholders.
Details of remuneration of other company employees can be found in Note 29 to the financial statements.
Governance Annual remuneration report
40 Bisichi PLC
Governance
The Audit Committee’s prime tasks are to:
• • review the scope of external audit, to
receive regular reports from the auditor
and to review the half-yearly and
annual accounts before they are
presented to the board, focusing in
particular on accounting policies and
areas of management judgment and
estimation;
• • monitor the controls which are in force
to ensure the integrity of the
information reported to the
shareholders;
• • assess key risks and to act as a forum
for discussion of risk issues and
contribute to the board’s review of the
effectiveness of the Group’s risk
management control and processes;
• • act as a forum for discussion of internal
control issues and contribute to the
board’s review of the effectiveness of
the Group’s internal control and risk
management systems and processes;
• • consider each year the need for an
internal audit function;
• • advise the board on the appointment of
external auditors and rotation of the
audit partner every five years, and on
their remuneration for both audit and
non-audit work, and discuss the nature
and scope of their audit work;
• • participate in the selection of a new
external audit partner and agree the
appointment when required;
• • undertake a formal assessment of the
auditors’ independence each year
which includes:
~ a review of non-audit services
provided to the Group and related
fees;
~ discussion with the auditors of a
written report detailing all
relationships with the company and
any other parties that could affect
independence or the perception of
independence;
~ a review of the auditors’ own
procedures for ensuring the
independence of the audit firm and
partners and staff involved in the
audit, including the regular rotation of
the audit partner; and
~ obtaining written confirmation from
the auditors that, in their professional
judgement, they are independent.
Meetings
The committee meets prior to the annual
audit with the external auditors to discuss
the audit plan and again prior to the
publication of the annual results. These
meetings are attended by the external
audit partner, managing director, director
of finance and company secretary. Prior to
bi-monthly board meetings the members
of the committee meet on an informal
basis to discuss any relevant matters
which may have arisen. Additional formal
meetings are held as necessary.
During the past year the committee:
• • met with the external auditors, and
discussed their reports to the Audit
Committee;
• • approved the publication of annual and
half-year financial results;
• • considered and approved the annual
review of internal controls;
• • decided that due to the size and nature
of operation there was not a current
need for an internal audit function;
• • agreed the independence of the
auditors and approved their fees for
both audit related and non-audit
services as set out in note 5 to the
financial statements.
Audit committee report
The committee’s terms of reference have been approved by the board and
follow published guidelines, which are available from the company secretary.
The audit committee comprises the two non-executive directors, Christopher
Joll (chairman), an experienced financial PR executive and John Sibbald, a
retired chartered accountant.
4141Bisichi PLC
Governance Audit committee report
Financial reporting
As part of its role, the Audit Committee
assessed the audit findings that were
considered most significant to the
financial statements, including those
areas requiring significant judgment and/
or estimation. When assessing the
identified financial reporting matters, the
committee assessed quantitative
materiality primarily by reference to profit
before tax. The Board also gave
consideration to:
• • the carrying value of the Group’s total
assets, given that the Group operates a
principally asset based business;
• • the value of revenues generated by the
Group, given the importance of coal
production and processing;
• • Adjusted EBITDA, given that it is a key
trading KPI, when determining
quantitative materiality; and
• • Going concern, given the potential
impact of macro-economic activity on
the Group’s operations.
The qualitative aspects of any financial
reporting matters identified during the
audit process were also considered when
assessing their materiality. Based on the
considerations set out above we have
considered quantitative errors individually
or in aggregate in excess of
approximately £300,000 to £350,000 to
be material.
External Auditors
Kreston Reeves LLP were appointed as
the statutory auditors during the year and
they have expressed their willingness to
continue in office and a resolution to
reappoint them will be proposed at the
forthcoming Annual General Meeting. In
the United Kingdom the company is
provided with extensive administration
and accounting services by London &
Associated Properties PLC which has its
own audit committee and employs a
separate firm of external auditors, RSM
UK Audit LLP. BDO South Africa Inc. acts
as the external auditor to the South
African companies, and the work of that
firm was reviewed by Kreston Reeves LLP
for the purpose of the Group audit.
Christopher Joll
Chairman – audit committee
12 Little Portland Street
London W1W8BJ
13 April 2022
42 Bisichi PLC
Governance
In accordance with your instructions we have carried out a valuation of the freehold property interests held as at 31 December
2021 by the company as detailed in our Valuation Report dated 16 February 2022.
Having regard to the foregoing, we are of the opinion that the open market value as at 31 December 2021 of the interests owned
by the company was £10,525,000 being made up as follows:
£’000
Freehold 8,230
Leasehold 2,295
10,525
Leeds
16 February 2022
Carter Towler
Regulated by Royal Institute of Chartered Surveyors
Valuers’ certificates
To the directors of Bisichi PLC
4343Bisichi PLC
Governance
Company law requires the directors to
prepare financial statements for each
financial year. Under that law the directors
are required to prepare the Group
financial statements in accordance with
UK-adopted international accounting
standards in conformity with the
requirements of the Companies Act 2006.
The directors have elected to prepare the
company financial statements in
accordance with United Kingdom
Generally Accepted Accounting Practice
(United Kingdom Accounting Standards
and applicable law). Under company law
the directors must not approve the
financial statements unless they are
satisfied that they give a true and fair view
of the state of affairs of the Group and
company and of the profit or loss for the
Group for that period.
In preparing these financial statements,
the directors are required to:
• • select suitable accounting policies and
then apply them consistently;
• • make judgements and accounting
estimates that are reasonable and
prudent;
• • state with regard to the Group financial
statements whether they have been
prepared in accordance with UK-
adopted international accounting
standards in conformity with the
requirements of the Companies Act
2006 subject to any material
departures disclosed and explained in
the financial statements;
• • state with regard to the parent
company financial statements, whether
applicable UK accounting standards
have been followed, subject to any
material departures disclosed and
explained in the financial statements;
• • prepare the financial statements on the
going concern basis unless it is
inappropriate to presume that the
company and the Group will continue in
business; and
• • prepare a director’s report, a strategic
report and director’s remuneration
report which comply with the
requirements of the Companies Act
2006.
The directors are responsible for keeping
adequate accounting records that are
sufficient to show and explain the
company’s transactions and disclose with
reasonable accuracy at any time the
financial position of the company and
enable them to ensure that the financial
statements comply with the Companies
Act 2006 and, as regards the Group
financial statements, Article 4 of the IAS
Regulation. They are also responsible for
safeguarding the assets of the company
and hence for taking reasonable steps for
the prevention and detection of fraud and
other irregularities. The Directors are
responsible for ensuring that the annual
report and accounts, taken as a whole, are
fair, balanced, and understandable and
provides the information necessary for
shareholders to assess the Group’s
performance, business model and strategy.
Website publication
The directors are responsible for ensuring
the annual report and the financial
statements are made available on a
website. Financial statements are
published on the company’s website in
accordance with legislation in the United
Kingdom governing the preparation and
dissemination of financial statements,
which may vary from legislation in other
jurisdictions. The maintenance and
integrity of the company’s website is the
responsibility of the directors. The
directors’ responsibility also extends to
the ongoing integrity of the financial
statements contained therein.
Directors’ responsibilities
pursuant to DTR4
The directors confirm to the best of their
knowledge:
• • the Group financial statements have
been prepared in accordance with
UK-adopted international accounting
standards in conformity with the
requirements of the Companies Act
2006 and give a true and fair view of
the assets, liabilities, financial position
and profit and loss of the Group.
• • the annual report includes a fair review
of the development and performance of
the business and the financial position
of the Group and the parent company,
together with a description of the
principal risks and uncertainties that
they face.
Directors’ responsibilities statement
The directors are responsible for preparing the annual report and the
financial statements in accordance with applicable law and regulations.
44 Bisichi PLC
Governance
Independent auditor report to the shareholders of
Bisichi Plc for the year ended 31 December 2021
Opinion
We have audited the financial statements
of Bisichi PLC (the ‘parent company’) and
its subsidiaries (the ‘Group’) for the year
ended 31 December 2021 which comprise
the consolidated income statement,
consolidated statement of other
comprehensive income, consolidated and
company balance sheets, consolidated
and company statements of changes in
equity, consolidated cash flow statement
and notes to the financial statements,
including a summary of significant Group
accounting policies. The financial
reporting framework that has been
applied in their preparation of the group
financial statements is applicable law and
UK adopted international accounting
standards. The financial reporting
framework that has been applied in the
preparation of the parent company
financial statements is applicable law and
United Kingdom Accounting Standards,
including FRS 101 Reduced Disclosure
Framework (United Kingdom Generally
Accepted Accounting Practice).
In our opinion, the financial statements:
• • 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
December 2021 and of the Group’s
profit for the year then ended;
• • the group financial statements have
been properly prepared in accordance
with UK adopted international
accounting standards;
• • the parent company financial
statements have been properly
prepared in accordance with United
Kingdom Generally Accepted
Accounting Practice; and
• • the financial statements have been
prepared in accordance with the
requirements of the Companies Act
2006
Basis for opinion
We conducted our audit in accordance
with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are
further described in the Auditor’s
responsibilities for the audit of the
financial statements section of our report.
We are independent of the Group in
accordance with the ethical requirements
that are relevant to our audit of the
financial statements in the UK, including
the FRC’s Ethical Standard as applied to
listed entities, and we have fulfilled our
other ethical responsibilities in
accordance with these requirements. We
believe that the audit evidence we have
obtained is sufficient and appropriate to
provide a basis for our opinion.
Conclusions relating to going
concern
In auditing the financial statements, we
have concluded that the Directors’ use of
the going concern basis of accounting in
the preparation of the financial
statements is appropriate. Our evaluation
of the directors assessment of the Group
and Parent companies ability to continue
to adopt the going concern basis of
accounting including the following:
• • Gained an understanding of the
systems and controls around
managements’ going concern
assessment, including for the
preparation and review process for
forecasts and budgets.
• • Evidence obtained that management
have undertaken a formal going concern
assessment, including sensitivity
analysis on cash flow forecasts, clear
consideration of external factors
including the COVID pandemic and the
war in Ukraine and the potential liquidity
impact of these on cash balances
including available facilities.
• • Analysed the financial strength of the
business at the year end date and
considered key trends in balance sheet
strength and business performance
over the last three years.
• • Confirmations gained that operation of
the business, including mine production
and sale at Black Wattle Colliery have
not been disrupted in the period by any
external or internal factors.
• • Testing the mechanical integrity of
forecast model by checking the
accuracy and completeness of the
model, including challenging the
appropriateness of estimates and
assumptions with reference to empirical
data and external evidence.
• • Based on our above assessment we
performed our own sensitivity analysis
in respect of the key assumptions
underpinning the forecasts.
• • We performed stress-testing analysis on
the core cash generating units of the
business to confirm cash inflow levels
needed to maintain minimal liquidity
required to meet liabilities as they fall due.
• • We considered post year end
performance of the business,
comparing this to budget as well as
considering the development of key
liquidity ratios in the business.
Independent auditor report to the shareholders of Bisichi Plc
4545Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
• • The group’s banking facility
documentation was reviewed to ensure
that any covenants in place have not
been breached.
• • We reviewed the adequacy and
completeness of the disclosure
included within the financial statements
in respect of going concern.
Based on the work we have performed,
we have not identified any material
uncertainties relating to events or
conditions that, individually or collectively,
may cast significant doubt on the entity’s
ability to continue as a going concern for
a period of at least twelve months from
when the financial statements are
authorised for issue.
In relation to the Group and Parent
Company’s reporting on how they have
applied the UK Corporate Governance
Code, we have nothing material to add or
draw attention to in relation to the
directors’ statement in the financial
statements about whether the directors
considered it appropriate to adopt the
going concern basis of accounting.
Our responsibilities and the
responsibilities of the directors with
respect to going concern are described in
the relevant sections of this report.
However, because not all future events or
conditions can be predicted, this
statement is not a guarantee as to the
Group’s and Parent Company’s ability to
continue as a going concern.
Corporate Governance
Statement
The Listing Rules require us to review the
directors’ statement in relation to going
concern, longer-term viability and that
part of the Corporate Governance
Statement relating to the Group’s and
Parent Company’s compliance with the
provisions of the UK Corporate
Governance Code specified for our
review.
Based on the work undertaken as part of
our audit, we have concluded that each of
the following elements of the Corporate
Governance Statement is materially
consistent with the financial statements
or our knowledge obtained during the audit:
• • Directors’ statement with regards to the
appropriateness of adopting the going
concern basis of accounting and any
material uncertainties identified set out
on page 30;
• • Directors’ explanation as to its
assessment of the company’s prospects,
the period this assessment covers and
why the period is appropriate set out on
page 22;
• • Board’s confirmation that it has carried
out a robust assessment of the emerging
and principal risks set out on pages 11
to 15;
• • The section of the Annual Report that
describes the review of effectiveness of
risk management and internal control
systems set out on page 28 and
• • The section describing the work of the
Risk and Audit Committee set out on
page 27.
An overview of the scope of
our audit
As part of designing our audit, we
determined materiality and assessed the
risks of material misstatement in the
financial statements. In particular, we
looked at where the directors made
subjective judgements, for example in
respect of significant accounting
estimates that involved making
assumptions and considering future
events that are inherently uncertain. As in
all of our audits we also addressed the
risk of management override of internal
controls, including evaluating whether
there was evidence of bias by the
directors that represented a risk of
material misstatement due to fraud.
46 Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
We reported all audit differences found in
excess of our triviality threshold to the
directors and the management board. For
each Group company within the scope of
our Group audit, we allocated a
materiality that is less than our overall
Group materiality. The range of
materiality allocated across each Group
company was between £227,000 and
£23,300. The scope of our audit was
influenced by our application of
materiality as we set certain quantitative
thresholds for performance materiality
and use these thresholds as a
consideration tool to help to determine
the scope of our audit and the nature,
timing and extent of our audit procedures
on the individual financial statement line
items and disclosures and in evaluating
the effect of misstatements, both
individually and in aggregate on the
financial statements as a whole.
We determined component materiality for
the parent company to be capped at
below group materiality. This was also the
case for group subsidiaries registered
outside of the UK. For the UK-registered
trading subsidiaries, 4% of that
subsidiary’s net assets was used.
Performance materiality was set in the
range of 70-80% of component
materiality.
Our application of materiality
Group financial statements Parent company financial statements
Materiality £359,600 £355,000
Basis for determining
materiality
2% of net assets Capped below group materiality
Rationale for benchmark
applied
The group's principal activity of that of
an exploration and mining operation and
investment property holdings. To this end the
business is highly asset focused. Therefore a
benchmark for materiality of the NA's of the
group is considered to be appropriate.
The parent company materiality has been
capped at below group materiality. This was to
address the aggregation risk in the group audit.
Performance materiality £269,700 £269,600
Basis for determining
performance materiality
75% of materiality Capped below group materiality
Rationale for
performance materiality
applied
On the basis of our risk assessments, together
with our assessment of the Group’s overall
control environment, our judgement was
that performance materiality was 75% of
our planning materiality. In assessing the
appropriate level, we consider the nature, the
number and impact of the audit differences
identified in the previous year’s audit.
The parent company performance materiality
has been capped at below group performance
materiality. This was to address the aggregation
risk in the group audit.
Triviality threshold £17,980 £17,975
Basis for determining
triviality threshold
5% of materiality Capped below group materiality
4747Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
Coverage overview
Group revenue Group profit/(loss) before tax Group net assets
Totals at 31 December
2021:
£50,519,592 £2,501,171 £17,835,066
Full statutory audit
(Kreston Reeves and BDO)
£50,519,592 (100%) £2,377,426 (95%) £17,092,472 (96%)
Limited procedures £Nil £123,745 (5%) £742,594 (4%)
We tailored the scope of our audit to
ensure that we performed sufficient
work to be able to give an opinion on
the financial statements as a whole,
taking into account the structure of the
Group and the parent company, the
accounting processes and controls,
and the industry in which they operate.
Our scoping considerations for the
Group audit were based both on
financial information and risk. As noted
above limited assurance audit work –
which is to say the audit of balances
and transactions material at a group
level – was only applied in respect of a
small element of the group. The below
table summarises for the parent
company, and its subsidiaries, in terms
of the level of assurance gained:
Group component Level of assurance
Bisichi PLC Full statutory audit (Kreston Reeves)
Mineral Products Limited Full statutory audit (Kreston Reeves)
Bisichi (Properties) Limited Full statutory audit (Kreston Reeves)
Bisichi Northampton Limited Full statutory audit (Kreston Reeves)
Black Wattle Colliery (Pty) Limited Full statutory audit (BDO)
Sisonke Coal Processing (Pty) Limited Full statutory audit (BDO)
Black Wattle Klipfontein (Pty) Limited Full statutory audit (BDO)
Bisichi Coal Mining (Pty) Limited Full statutory audit (BDO)
All other group undertakings Limited assurance (Kreston Reeves)
48 Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
Key audit matters
Key audit matters are those matters that,
in our professional judgment, were of
most significance in our audit of the
financial statements of the current period
and include the most significant assessed
risks of material misstatement (whether
or not due to fraud) that we identified,
including those which had the greatest
effect on: the overall audit strategy, the
allocation of resources in the audit; and
directing the efforts of the engagement
team. These matters were addressed in
the context of our audit of the financial
statements as a whole, and in forming our
opinion thereon, and we do not provide a
separate opinion on these matters. This is
not a complete list of all risks identified by
our audit.
Revenue recognition: £50,519,592
Significance and nature of key risk
Revenue is a key performance indicator for users in
assessing the group’s financial statements. Revenue
generated has a significant impact on cash inflows and
profit before tax for the group. As such revenue is a
key determinant in profitability and the group’s ability to
generate cash.
Revenue comprises two key revenue streams: the sale of
coal and property rental income.
Coal revenue is recognised when the customer has a legally
binding obligation to settle under the terms of the contract.
Rental income is recognised in the Group income statement
on a straight-line basis over the term of the lease.
How our audit addressed the key risk
Sales of coal and coal processing services in the period were
tested from the trigger point of the sale to the point of recognition
in the financial statements, corroborating this to contract sales or
service terms and the recognition stages detailed in IFRS 15.
Rental income revenue was recalculated based on the terms
included in signed lease agreements. Again, the recognition
stages detailed the relevant standards were carefully considered
to ensure revenue recognised was in line with these. This
substantive testing covered 100% of total property rental
revenues.
Revenue streams were further analytically reviewed via
comparison to our expectations. Expectations were based on
a combination of prior financial data/budgets and our own
assessments based on our knowledge gained of the business.
Cut-off of revenue was reviewed by analysing sales recorded
during the period just before and after the financial year end and
determining if the recognition applied was appropriate.
Walkthrough testing was performed to ensure that key systems
and controls in place around the revenue cycle operated as
designed.
The accuracy of revenue disclosures in the accounts were
confirmed to be consistent with the revenue cycle observed and
audited. The completeness of these disclosures was confirmed by
reference to the full disclosure requirements as detailed in IFRS
15.
Key observations communicated to the Risk and Audit Committee
We have no concerns over the material accuracy of revenue recognised in the financial statements.
4949Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
Valuation/impairment of investment properties: £10,700,134
Significance and nature of key risk
Investment properties comprise freehold and long leasehold
land and buildings. Investment properties are carried at fair
value in accordance with IAS 40.
Investment properties are revalued annually by professional
external surveyors and included in the balance sheet at their
fair value. Gains or losses arising from changes in the fair
values of assets are recognised in the consolidated income
statement in the period to which they relate. In accordance
with IAS 40, investment properties are not depreciated.
The fair value of the head leases is the net present value of
the current head rent payable on leasehold properties until
the expiry of the lease.
How our audit addressed the key risk
Appropriate classification of investment properties under IAS 40
was considered, especially in relation to long leasehold land and
buildings.
External valuation reports were obtained and vouched to stated
fair values. The competence and independence of the valuation
experts was carefully considered to ensure that the reports they
produce can be relied upon.
The key assumptions made within these reports were reviewed
and considered for reasonableness, including rental yield
analysis. We have further performed our own separate impairment
considerations to consider if events/factors in place at year end
present material impairment indicators.
Key observations communicated to the Risk and Audit Committee
We have no concerns over the material accuracy of investment property values recognised in the financial statements.
Valuation/impairment of mining reserves and development: £8,896,000
Significance and nature of key risk
The purpose of mine development is to establish secure
working conditions and infrastructure to allow the safe and
efficient extraction of recoverable reserves.
Depreciation on mine development costs is not charged
until production commences or the assets are put to
use. On commencement of full commercial production,
depreciation is charged over the life of the associated mine
reserves extractable using the asset on a unit of production
basis.
The unit of production calculation is based on tonnes
mined as a ratio to proven and probable reserves
and also includes future forecast capital expenditure.
The cost recognised includes the recognition of any
decommissioning assets related to mine development.
How our audit addressed the key risk
The accounting requirements of IFRS 6 and IAS 16 were
considered to ensure capitalisation of costs to mine development
under IAS 16 was appropriate.
In considering impairment indicators, as governed by IAS 36,
the life of mine assessment was obtained. All significant input
variables were considered and stress-tested to assess headroom
between modelling and the value of mine development.
Consideration was given to the competence and independence of
the technical expert involved with the production of historic technical
reports on which the life of mine assessment is partially built.
Depreciation of mine development was recalculated based on
the unit of production basis to ensure accurately recorded. This
basis was also considered for reasonableness by reference to the
accounting policies of industry peers.
The accuracy and appropriateness of mine development
disclosures in the accounts were confirmed to be consistent with
the mine development accounting cycle observed and audited.
Key observations communicated to the Risk and Audit Committee
We have no concerns over the material accuracy of mining reserves and development values recognised in the financial
statements.
50 Bisichi PLC
Other information
The other information comprises the
information included in the annual report
other than the financial statements and
our auditor’s report thereon. The directors
are responsible for the other information
contained within the annual report. Our
opinion on the financial statements does
not cover the other information and, except
to the extent otherwise explicitly stated in
our report, we do not express any form of
assurance conclusion thereon. Our
responsibility is to read the other information
and, in doing so, consider whether the
other information is materially inconsistent
with the financial statements or our
knowledge obtained in the course of the
audit, or otherwise appears to be materially
misstated. If we identify such material
inconsistencies or apparent material
misstatements, we are required to
determine whether this gives rise to a
material misstatement in the financial
statements themselves. If, based on the
work we have performed, we conclude
that there is a material misstatement of
this other information, we are required to
report that fact. We have nothing to report
in this regard.
Our opinion on the
remuneration report
Kreston Reeves has audited the Annual
remuneration report set out on pages 32
to 39 of the Annual Report for the year
ended 31 December 2021. The directors
of the Company are responsible for the
preparation and presentation of the
Remuneration Report in accordance with
the Companies Act 2006. Kreston Reeves’
responsibility is to express an opinion on
the Remuneration Report, based on our
audit conducted in accordance with
International Accounting Standards. In
Kreston Reeves’ opinion, the Remuneration
Report of the Group for the year, complies
with the requirements of the Companies
Act 2006.
Our consideration of climate
change related risks
The financial impacts on the Group of
climate change and the transition to a low
carbon economy (“climate change”) were
considered in our audit where they have
the potential to directly or indirectly
impact key judgements and estimates
within the financial statements.
The Group continues to develop its
assessment of the potential impacts of
climate change. Climate risks have the
potential to materially impact the key
judgements and estimates within the
financial report. Our audit considered
those risks that could be material to the
key judgement and estimates in the
assessment of the carrying value of
non-current assets and closure and
rehabilitation provisions.
The key judgements and estimates
included in the financial statements
incorporate actions and strategies, to the
extent they have been approved and can
be reliably estimated in accordance with
the Group’s accounting policies.
Accordingly, our key audit matters
address how we have assessed the
Group’s climate related assumptions to
the extent they impact each key audit
matter. Our audit procedures were
performed with the involvement of our
climate change and valuation specialists.
Opinions on other matters
prescribed by the Companies
Act 2006
In our opinion, based on the work
undertaken in the course of the audit:
•• the information given in the strategic
report and the directors’ report for the
financial year for which the financial
statements are prepared is consistent
with the financial statements; and
•• the strategic report and the directors’
report have been prepared in accordance
with applicable legal requirements.
Matters on which we are
required to report by exception
In the light of our knowledge and
understanding of the Group and parent
company and its environment obtained in
the course of the audit, we have not
identified material misstatements in the
strategic report or the directors’ report.
We have nothing to report in respect of
the following matters in relation to which
the Companies Act 2006 requires us to
report to you if, in our opinion:
•• adequate accounting records have not
been kept by the parent company, or
returns adequate for our audit have not
been received from branches not
visited by us; or
•• the parent company financial
statements 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
Responsibilities of directors
As explained more fully in the directors’
responsibilities statement (set out on
page 43), the directors are responsible
for the preparation of the financial
statements and for being satisfied that
they give a true and fair view, and for
such internal control as the directors
determine is necessary to enable the
preparation of financial statements that
are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the
directors are responsible for assessing
the Group’s and parent company’s ability
to continue as a going concern,
disclosing, as applicable, matters related
to going concern and using the going
concern basis of accounting unless the
directors either intend to liquidate the
Group or parent company or to cease
Governance Independent auditor report to the shareholders of Bisichi Plc
5151Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
operations, or have no realistic alternative
but to do so.
Auditor’s responsibilities for
the audit of the financial
statements
Our objectives are to obtain reasonable
assurance about whether the financial
statements as a whole are free from
material misstatement, whether due to
fraud or error, and to issue an auditor’s
report that includes our opinion.
Reasonable assurance is a high level of
assurance but is not a guarantee that an
audit conducted in accordance with ISAs
(UK) will always detect a material
misstatement when it exists.
Misstatements can arise from fraud or
error and are considered material if,
individually or in the aggregate, they
could reasonably be expected to
influence the economic decisions of users
taken on the basis of these financial
statements.
Capability of the audit in detecting
irregularities, including fraud
Based on our understanding of the group
and industry, and through discussion with
the directors and other management (as
required by auditing standards), we
identified that the principal risks of
non-compliance with laws and regulations
related to health and safety, anti-bribery
and employment law. We considered the
extent to which non-compliance might
have a material effect on the financial
statements. We also considered those
laws and regulations that have a direct
impact on the preparation of the financial
statements such as the Companies Act
2006. We communicated identified laws
and regulations throughout our team and
remained alert to any indications of
non-compliance throughout the audit. We
evaluated management’s incentives and
opportunities for fraudulent manipulation
of the financial statements (including the
risk of override of controls), and
determined that the principal risks were
related to posting inappropriate journal
entries to increase revenue or reduce
expenditure, management bias in
accounting estimates and judgemental
areas of the financial statements such as
the valuation of investment properties
and mining reserve and development
asset. Audit procedures performed by the
group engagement team and component
auditors included:
•• We obtained an understanding of the
legal and regulatory frameworks that
are applicable to the Group and
determined that the most significant
are those that relate to the reporting
framework and the relevant tax
compliance regulations in the
jurisdictions in which Bisichi PLC
operates. In addition, we concluded
that there are certain significant laws
and regulations that may have an effect
on the determination of the amounts
and disclosures in the financial
statements, mainly relating to health
and safety, employee matters, bribery
and corruption practices, environmental
and certain aspects of company
legislation recognising the regulated
nature of the Group’s mining and oil
and gas activities and its legal form.
•• Detailed discussions were held with
management to identify any known or
suspected instances of non-
compliance with laws and regulations.
•• Identifying and assessing the design
effectiveness of controls that
management has in place to prevent
and detect fraud.
•• Challenging assumptions and
judgements made by management in
its significant accounting estimates,
including assessing the capabilities of
the property valuers and discussing
with the valuers how their valuations
were calculated and the data and
assumptions they have used to
calculate these.
•• Performing analytical procedures to
identify any unusual or unexpected
relationships, including related party
transactions, that may indicate risks of
material misstatement due to fraud.
•• Confirmation of related parties with
management, and review of
transactions throughout the period to
identify any previously undisclosed
transactions with related parties
outside the normal course of business.
•• Reading minutes of meetings of those
charged with governance, reviewing
internal audit reports and reviewing
correspondence with relevant tax and
regulatory authorities.
•• Review of significant and unusual
transactions and evaluation of the
underlying financial rationale
supporting the transactions.
•• Identifying and testing journal entries,
in particular any manual entries made
at the year end for financial statement
preparation.
•• We ensured our global audit team
(including Kreston Reeves and BDO)
has deep industry experience through
working for many years on relevant
audits, including experience of mining
and investment property management.
Our audit planning included considering
external market factors, for example
geopolitical risk, the potential impact of
climate change, commodity price risk
and major trends in the industry.
Because of the inherent limitations of an
audit, there is a risk that we will not detect
all irregularities, including those leading
to a material misstatement in the financial
statements or non-compliance with
regulation. This risk increases the more
that compliance with a law or regulation is
removed from the events and
transactions reflected in the financial
statements, as we will be less likely to
become aware of instances of non-
compliance.
52 Bisichi PLC
Governance Independent auditor report to the shareholders of Bisichi Plc
As part of an audit in accordance with
ISAs (UK), we exercise professional
judgment and maintain professional
scepticism throughout the audit. We also:
•• Identify and assess the risks of material
misstatement of the financial
statements, whether due to fraud or
error, design and perform audit
procedures responsive to those risks,
and obtain audit evidence that is
sufficient and appropriate to provide a
basis for our opinion. The risk of not
detecting a material misstatement
resulting from fraud is higher than for
one resulting from error, as fraud may
involve collusion, forgery, intentional
omissions, misrepresentations, or the
override of internal control.
•• Obtain an understanding of internal
control relevant to the audit in order to
design audit procedures that are
appropriate in the circumstances, but
not for the purpose of expressing an
opinion on the effectiveness of the
Group’s internal control.
•• Evaluate the appropriateness of
accounting policies used and the
reasonableness of accounting
estimates and related disclosures made
by the directors.
•• Conclude on the appropriateness of the
directors’ use of the going concern
basis of accounting and, based on the
audit evidence obtained, whether a
material uncertainty exists related to
events or conditions that may cast
significant doubt on the Group’s or the
parent company’s ability to continue as
a going concern. If we conclude that a
material uncertainty exists, we are
required to draw attention in our
auditor’s report to the related
disclosures in the financial statements
or, if such disclosures are inadequate,
to modify our opinion. Our conclusions
are based on the audit evidence
obtained up to the date of our auditor’s
report. However, future events or
conditions may cause the Group or the
parent company to cease to continue
as a going concern.
•• Evaluate the overall presentation,
structure and content of the financial
statements, including the disclosures,
and whether the financial statements
represent the underlying transactions
and events in a manner that achieves
fair presentation.
•• Obtain sufficient appropriate audit
evidence regarding the financial
information of the entities or business
activities within the Group to express
an opinion on the consolidated financial
statements. We are responsible for the
direction, supervision and performance
of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged
with governance regarding, among other
matters, the planned scope and timing of
the audit and significant audit findings,
including any significant deficiencies in
internal control that we identify during
our audit.
Other matters which we are
required to address
We were appointed by the audit committee
on 19 November 2021 to audit the financial
statements for the year ending 31
December 2021. Our total uninterrupted
period of engagement is 1 year, covering
the year ended 31 December 2021. The
non-audit services prohibited by the FRC’s
Ethical Standard were not provided to the
group or the parent company and we
remain independent of the group and the
parent company in conducting our audit.
During the period under review, agreed
upon procedures were completed in
respect of a number of the group’s service
charge accounts. Our audit opinion is
consistent with the additional report to the
audit committee.
Use of our report
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 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.
Anne Dwyer BSc(Hons) FCA (Senior
Statutory Auditor)
For and on behalf of
Kreston Reeves LLP
Chartered Accountants
Statutory Auditor
London
Date: 19 April 2022
Financial statements
54 Consolidated income statement
55 Consolidatedstatementofothercomprehensiveincome
56 Consolidatedbalancesheet
58 Consolidatedstatementofchangesinshareholders’equity
59 Consolidatedcashflowstatement
60 Groupaccountingpolicies
68 Notestothefinancialstatements
94 Companybalancesheet
95 Companystatementofchangesinequity
96 Companyaccountingpolicies
53BisichiPLC
54 BisichiPLC
Financial statements
Notes
2021
Trading
£’000
2021
Revaluations
and
impairment
£’000
2021
Total
£’000
2020
Trading
£’000
2020
Revaluations
and
impairment
£’000
2020
Total
£’000
Group revenue 2 50,520 - 50,520 29,805 - 29,805
Operatingcosts 3 (45,492 ) - (45,492 ) (30,916 ) - (30,916 )
Operatingprofit/(loss)before
depreciation,fairvalueadjustments
andexchangemovements
Depreciation 3 (2,571 ) - (2,571 ) (2, 193 ) - (2,193 )
Operatingprofit/(loss)beforefairvalue
adjustmentsandexchangemovements
1 2,45 7 - 2,457 (3,304 ) - (3,304 )
Exchange(losses)/gains (121 ) - (121 ) 39 - 39
Increase/(Decrease)invalueof
investmentproperties
4 - 255 255 - (1,295 ) (1,295 )
Gainoninvestmentsheldatfairvalue - 812 812 - 67 67
Operating profit/(loss) 1 2,336 1,06 7 3,403 (3,265 ) (1,228 ) (4,493 )
Shareoflossinjointventures 13 - (125 ) (125 ) - (87 ) (8 7 )
Profit/(Loss) before interest and
taxation
Interestreceivable 22 - 22 25 - 25
Interestpayable 7 (7 99 ) - (7 99 ) (641 ) - (641 )
Profit/(Loss) before tax 5 1,559 942 2,501 (3,881 ) (1,315 ) (5, 196 )
Taxation 8 (453 ) (342 ) (795 ) 1,225 177 1,402
Profit/(Loss) for the year 1, 106 600 1,7 06 (2,656 ) (1, 138 ) (3, 7 94 )
Attributable to:
Equityholdersofthecompany 891 600 1,491 (2,216 ) (1, 138 ) (3,354 )
Non-controllinginterest 27 215 - 215 (440 ) - (440 )
Profit/(Loss) for the year 1, 106 600 1, 706 (2,656 ) (1, 138 ) (3,7 94 )
Profit/(Loss)pershare–basic 10 13.96 p (31.42 p)
Profit/(Loss)pershare–diluted 10 13.94 p (31.42 p)
Tradinggainsandlossesreflectallthetradingactivityonminingandpropertyoperationsandrealisedgains.Revaluationgains
andlossesreflectstherevaluationofinvestmentpropertiesandotherassetswithintheGroupandanyproportionofunrealised
gainsandlosseswithinJointVentures.Thetotalcolumnrepresentstheconsolidatedincomestatementpresentedinaccordance
withIAS1.
Consolidated income statement
for the year ended 31 December 2021
Financial statements
BisichiPLC 55
Financial statements
Consolidated statement ofother
comprehensiveincome
for the year ended 31 December 2021
2021
£’000
2020
£’000
Profit/(Loss) for the year 1, 706 (3,7 94 )
Other comprehensive income/(expense):
Items that may be subsequently recycled to the income statement:
Exchangedifferencesontranslationofforeignoperations (60 ) (46 7 )
Other comprehensive income for the year net of tax (60 ) (46 7 )
Total comprehensive income for the year net of tax 1,646 (4,261 )
Attributable to:
Equityshareholders 1,439 (3,7 52 )
Non-controllinginterest 207 (509 )
56 BisichiPLC
Financial statements
Notes
2021
£’000
2020
£’000
Assets
Non-current assets
Investmentproperties 11 10, 700 10,4 71
Miningreserves,plantandequipment 12 9,065 10, 17 4
Investmentsinjointventuresaccountedforusingequitymethod 13 1, 130 1,255
Otherinvestmentsatfairvaluethroughprofitandloss(“FVPL”) 13 3,631 1, 7 46
Total non-current assets 24,526 23,646
Current assets
Inventories 16 1,253 3,445
Tradeandotherreceivables 17 8,626 6,958
InvestmentsinlistedsecuritiesheldatFVPL 18 685 833
Cashandcashequivalents 3,018 3, 7 68
Total current assets 13,582 15,004
Total assets 38, 108 38,650
Liabilities
Current liabilities
Borrowings 20 (2,666 ) (5, 110 )
Tradeandotherpayables 19 (10, 7 43 ) (10,856 )
Currenttaxliabilities (7 26 ) (209 )
Total current liabilities (14, 135 ) (16, 17 5 )
Non-current liabilities
Borrowings 20 (3,853 ) (3,943 )
Provisionforrehabilitation 21 (1,390 ) (1,442 )
Leaseliabilities 31 (389 ) (427 )
Deferredtaxliabilities 23 (506 ) (4 7 4 )
Total non-current liabilities (6, 138 ) (6,286 )
Total liabilities (20,27 3 ) (22,461 )
Net assets 17 ,835 16,189
Consolidated balance sheet
at 31 December 2021
5757BisichiPLC
Financial statements Consolidated balance sheet
A R Heller G J Casey Company Registration No. 112155
Director Director
Notes
2021
£’000
2020
£’000
Equity
Sharecapital 24 1,068 1,068
Sharepremiumaccount 258 258
Translationreserve (2,540 ) (2,488 )
Otherreserves 25 707 707
Retainedearnings 18,019 16,528
Total equity attributable to equity shareholders 17 ,512 16,0 73
Non-controllinginterest 27 323 116
Total equity 17 ,835 16,189
Thesefinancialstatementswereapprovedandauthorisedforissuebytheboardofdirectorson13April2022andsignedonits
behalfby:
58 BisichiPLC
Financial statements
Share
capital
£’000
Share
Premium
£’000
Transla-
tion
reserves
£’000
Other
reserves
£’000
Retained
earnings
£’000
Total
£’000
Non-
controlling
interest
£’000
Total
equity
£’000
Balance at 1 January 2020 1,068 258 (2,090 ) 707 19,989 19,932 625 20,557
Lossfortheyear - - - - (3,354 ) (3,354 ) (440 ) (3, 794 )
Othercomprehensiveexpense - - (398 ) - - (398 ) (69 ) (46 7 )
Totalcomprehensiveexpense
fortheyear
Dividend(note9) - - - - (10 7 ) (10 7 ) - (107 )
Balance at 1 January 2021 1,068 258 (2,488 ) 707 16,528 16,073 116 16, 189
Profitfortheyear - - - - 1,491 1,491 215 1,7 06
Othercomprehensiveincome - - (52 ) - - (52 ) (8 ) (60 )
Totalcomprehensiveincomefor
theyear
Dividend(note9) - - - - - - - -
Balance at 31 December 2021 1,068 258 (2,540 ) 707 18,019 17 ,512 323 17 ,835
Consolidated statement of changes
inshareholders’ equity
for the year ended 31 December 2021
5959BisichiPLC
Financial statements
Year ended
31 December
2021
£’000
Yearended
31December
2020
£’000
Cash flows from operating activities
Operatingprofit/Loss 3,403 (4,493 )
Adjustmentsfor:
Depreciation 2,571 2, 193
Unrealised(gain)/lossoninvestmentproperties (255 ) 1,295
GainoninvestmentsheldatFVPL (812 ) (6 7 )
Exchangeadjustments 121 (39 )
Cash flow before working capital 5,028 (1, 111 )
Changeininventories 2, 105 (1, 12 7 )
Changeintradeandotherreceivables (1,900 ) 122
Changeintradeandotherpayables 192 3,37 9
Cash generated from operations 5,425 1,263
Interestreceived 22 25
Interestpaid (799 ) (641 )
Incometaxpaid (216 ) (198 )
Cash flow from operating activities 4,432 449
Cash flows from investing activities
Acquisitionofreserves,property,motorvehicles,plantandequipment (1, 781 ) (3, 186 )
Investmentinjointventure - -
Disposalofotherinvestments 70 5 253
Acquisitionofotherinvestments (1,630 ) (1,359 )
Cash flow from investing activities (2, 706 ) (4,292 )
Cash flows from financing activities
Borrowingsdrawn 46 61
Borrowingsandleaseliabilitiesrepaid (317 ) (239 )
Equitydividendspaid - (10 7 )
Minoritydividendspaid - -
Cash flow from financing activities (271 ) (285 )
Net increase in cash and cash equivalents 1,455 (4, 128 )
Cashandcashequivalentsat1January (1,078 ) 2,8 7 8
Exchangeadjustment 105 172
Cash and cash equivalents at 31 December 482 (1,0 7 8 )
Cashandcashequivalentsat31Decembercomprise:
Cashandcashequivalentsaspresentedinthebalancesheet 3,018 3, 7 68
Bankoverdrafts(secured) (2,536 ) (4,846 )
Consolidated cash flow statement
for the year ended 31 December 2021
60 BisichiPLC
Financial statements
Basis of accounting
Theresultsfortheyearended31
December2021havebeenpreparedin
accordancewithUK-adopted
internationalaccountingstandardsin
conformitywiththerequirementsofthe
CompaniesAct2006.Inapplyingthe
Group’saccountingpoliciesand
assessingareasofjudgmentand
estimationmaterialityisappliedas
detailedonpage40oftheAudit
CommitteeReport.Theprincipal
accountingpoliciesaredescribedbelow:
TheGroupfinancialstatementsare
presentedin£sterlingandallvaluesare
roundedtothenearestthousandpounds
(£000)exceptwhenotherwisestated.
Thefunctionalcurrencyforeachentityin
theGroup,andforjointarrangements
andassociates,isthecurrencyofthe
countryinwhichtheentityhasbeen
incorporated.Detailsofwhichcountry
eachentityhasbeenincorporatedcanbe
foundinNote15forsubsidiariesandNote
14forjointarrangementsandassociates.
Theexchangeratesusedintheaccounts
wereasfollows:
Going concern
TheGrouphaspreparedcashflow
forecastswhichdemonstratethatthe
Grouphassufficientresourcestomeet
itsliabilitiesastheyfalldueforatleast
thenext12monthsfromdateofsigning.
InSouthAfrica,astructuredtradefinance
facilitywithAbsaBankLimitedfor
R85millionisheldbySisonkeCoal
Processing(Pty)Limited,a100%
subsidiaryofBlackWattleColliery(Pty)
Limited.Thisfacilitycomprisesofa
R85millionrevolvingfacilitytocoverthe
workingcapitalrequirementsofthe
Group’sSouthAfricanoperations.The
facilityisrenewableannuallyat25
Januaryandissecuredagainstinventory,
debtorsandcashthatareheldinthe
Group’sSouthAfricanoperations.The
Directorsdonotforeseeanyreasonwhy
thefacilitywillnotcontinuetoberenewed
atthenextrenewaldate,inlinewithprior
periodsandbasedontheirbanking
relationships.
Thedirectorsexpectthatthecoalmarket
conditionsexperiencedbyitsSouth
Africancoalminingandprocessing
operationsin2021willbesimilargoing
into2022.Thedirectorsthereforehavea
reasonableexpectationthattheminewill
achievepositivelevelsofcashgeneration
fortheGroupin2022.Asa
consequence,thedirectorsbelievethat
theGroupiswellplacedtomanageits
SouthAfricanbusinessriskssuccessfully.
IntheUK,forecastsdemonstratethatthe
Grouphassufficientresourcestomeet
itsliabilitiesastheyfalldueforatleast
thenext12months,fromtheapprovalof
thefinancialstatements,includingthose
relatedtotheGroup’sUKLoanfacility
outlinedbelow.
TheGroupholdsa5yeartermfacilityof
£3.9mwithJulianHodgeBankLimitedat
aninitialLTVof40%.Theloanissecured
againstthecompany’sUKretailproperty
portfolio.Theamountrepayableonthe
loanatyearendwas£3.9million.The
debtpackagehasafiveyeartermandis
repayableattheendofthetermin
December2024.Inthelastquarterof
2021thebaseinterestrateontheloan
changedfromLIBORtotheBankof
Englandbaserate.Theoverallinterest
costoftheloanis4.00%abovetheBank
ofEnglandbaserate.Allcovenantson
theloanweremetduringtheyearandthe
directorshaveareasonableexpectation
thattheGrouphasadequatefinancial
resourcesatshortnotice,includingcash
andlistedequityinvestments,toensure
theexistingfacility’scovenantsaremet
onanongoingbasis.
DragonRetailPropertiesLimited
(“Dragon”),theGroup’s50%ownedjoint
venture,holdsaSantanderbankloanof
£1.2millionsecuredagainstitsinvestment
property,seenote14.Thebankloanof
£1.164millionissecuredbywayofafirst
chargeonspecificfreeholdpropertyata
valueof£2.08million.
Group accounting policies
for the year ended 31 December 2021
£1 Sterling: Rand £1 Sterling: Dollar
2021 2020 2021 2020
Year-endrate 20.7672 20.0145 1.3706 1.3663
Annualaverage 20.4060 21.0936 1.3685 1.2833
6161BisichiPLC
Financial statements Group accounting policies
Theinterestcostoftheloanis2.75per
centabovethebank’sbaserate.A
refinancingofthisloaniscurrently
underway.Theloanoriginallyexpiredin
October2020buthasbeenextendedto
April2022,andthelenderhasofferedto
extendthisfurtherifrequired.Dragonhas
agreedtermswithanewlenderto
refinancethisloaninfullandare
expectingtocompletethisshortly.
Subsequenttoyearendinthefirst
quarterof2022geo-politicaleventsin
Ukraineresultedinhigherglobalenergy
prices.Althoughthefinaloutcomeofthe
eventsinUkraineisuncertain,the
Directorsatpresentdonotforeseethe
eventshavingasignificantnegative
impactontheGroup’sUKandSouth
Africanoperationsabilitytoremainin
operationfortheforeseeablefuture.
Asaresultofthebankingfacilitiesheld
aswellastheacceptablelevelsofcash
expectedtobeheldbytheGroupover
thenext12months,theDirectorsbelieve
thattheGrouphasadequateresources
tocontinueinoperationalexistencefor
theforeseeablefutureandthattheGroup
iswellplacedtomanageitsbusiness
risks.Thustheycontinuetoadoptthe
goingconcernbasisofaccountingin
preparingtheannualfinancial
statements.
International Financial Reporting
Standards (IFRS)
TheGrouphasadoptedallofthenew
andrevisedStandardsandInterpretations
issuedbytheInternationalAccounting
StandardsBoard(“IASB”)thatare
relevanttoitsoperationsandeffectivefor
accountingperiodsbeginning1January
2021.
Anumberofnewstandards,amendments
tostandardsandinterpretationshave
beenissuedbutarenotyeteffectivefor
theGroup.TheGrouphasnotadopted
anyStandardsorInterpretationsin
advanceoftherequiredimplementation
dates.Theapplicationofthesenew
standards,amendmentsand
interpretationsarenotexpectedtohavea
significantimpactontheGroup’sincome
statementorbalancesheet.
Wearecommittedtoimprovingdisclosure
andtransparencyandwillcontinuetowork
withourdifferentstakeholderstoensure
theyunderstandthedetailofthese
accountingchanges.Wecontinuetoremain
committedtoarobustfinancialpolicy.
Key judgements and estimates
Areaswherekeyestimatesandjudgements
areconsideredtohaveasignificanteffect
ontheamountsrecognisedinthefinancial
statementsinclude:
Life of mine and reserves
Thedirectorsconsidertheirjudgements
andestimatessurroundingthelifeofthe
mineanditsreservestohavesignificant
effectontheamountsrecognisedinthe
financialstatementsandtobeanarea
wherethefinancialstatementsare
subjecttosignificantestimation
uncertainty.Thelifeofmineremainingis
currentlyestimatedat8years.Thislifeof
mineisbasedontheGroup’sexisting
coalreservesincludingreservesacquired
butsubjecttoregulatoryapproval.The
Groupactivelyseeksnewopportunities
toextendthelifeofmineofitsexisting
miningoperationsordevelopnew
independentminingoperationsinSouth
Africa.Thelifeofmineexcludesfuturecoal
purchasesandcoalreserveacquisitions.
TheGroup’sestimatesofprovenand
probablereservesarepreparedutilising
theSouthAfricancodeforthereporting
ofexplorationresults,mineralresources
andmineralreserves(theSAMRECcode)
andaresubjecttoassessmentbyan
independentCompetentPerson
experiencedinthefieldofcoalgeology
andspecificallyopencastandpillarcoal
extraction.Estimatesofcoalreserves
impactassessmentsofthecarryingvalue
ofproperty,plantandequipment,
depreciationcalculationsand
rehabilitationanddecommissioning
provisions.Therearenumerous
uncertaintiesinherentinestimatingcoal
reservesandchangestothese
assumptionsmayresultinrestatementof
reserves.Theseassumptionsinclude
geotechnicalfactorsaswellaseconomic
factorssuchascommodityprices,
productioncostsandyield.
Depreciation, amortisation of mineral
rights, mining development costs and
plant & equipment
Theannualdepreciation/amortisation
chargeisdependentonestimates,
includingcoalreservesandtherelated
lifeofmine,expecteddevelopment
expenditureforprobablereserves,the
allocationofcertainassetstorelevantore
reservesandestimatesofresidualvalues
oftheprocessingplant.Thechargecan
fluctuatewhentherearesignificant
changesinanyofthefactorsor
assumptionsused,suchasestimating
mineralreserveswhichinturnaffectsthe
lifeofmineortheexpectedlifeof
reserves.Estimatesofprovenand
probablereservesarepreparedbyan
independentCompetentPerson.
Assessmentsofdepreciation/
amortisationratesagainsttheestimated
reservebaseareperformedregularly.
Detailsofthedepreciation/amortisation
chargecanbefoundinnote12.
62 BisichiPLC
Financial statements Group accounting policies
Provision for mining rehabilitation
including restoration and
de-commissioning costs
Aprovisionforfuturerehabilitation
includingrestorationand
decommissioningcostsrequires
estimatesandassumptionstobemade
aroundtherelevantregulatory
framework,thetiming,extentandcosts
oftherehabilitationactivitiesandofthe
riskfreeratesusedtodeterminethe
presentvalueofthefuturecashoutflows.
Theprovisions,includingtheestimates
andassumptionscontainedtherein,are
reviewedregularlybymanagement.The
Groupannuallyengagesanindependent
experttoassessthecostofrestoration
andfinaldecommissioningaspartof
management’sassessmentoftheprovision.
Detailsoftheprovisionformining
rehabilitationcanbefoundinnote21.
Impairment
Property,plantandequipment
representingtheGroup’sminingassetsin
SouthAfricaarereviewedforimpairment
whenthereareindicatorsofimpairment.
Theimpairmenttestisperformedusing
theapprovedLifeofMineplanandthose
futurecashflowestimatesarediscounted
usingassetspecificdiscountratesand
arebasedonexpectationsaboutfuture
operations.Theimpairmenttestrequires
estimatesaboutproductionandsales
volumes,commodityprices,provenand
probablereserves(asassessedbythe
CompetentPerson),operatingcostsand
capitalexpendituresnecessarytoextract
reservesintheapprovedLifeofMine
plan.Changesinsuchestimatescould
impactrecoverablevaluesofthese
assets.Detailsofthecarryingvalueof
property,plantandequipmentcanbe
foundinnote12.
Theimpairmenttestindicatedsignificant
headroomasat31December2021and
thereforenoimpairmentisconsidered
appropriate.Thekeyassumptions
include:coalprices,includingdomestic
coalpricesbasedonrecentpricingand
assessmentofmarketforecastsfor
exportcoal;productionbasedonproven
andprobablereservesassessedbythe
independentCompetentPersonand
yieldsassociatedwithminingareas
basedonassessmentsbytheCompetent
Personandempiricaldata.An10%
reductioninaverageforecastcoalprices
ora14%reductioninyieldwouldgive
risetoabreakevenscenario.However,
thedirectorsconsidertheforecasted
yieldlevelsandpricingtobeappropriate
andsupportablebestestimates.
Fair value measurements of
investmentproperties
Anassessmentofthefairvalueof
investmentproperties,isrequiredtobe
performed.Insuchinstances,fairvalue
measurementsareestimatedbasedon
theamountsforwhichtheassetsand
liabilitiescouldbeexchangedbetween
marketparticipants.Totheextent
possible,theassumptionsandinputs
usedtakeintoaccountexternally
verifiableinputs.However,such
informationisbynaturesubjectto
uncertainty.Thefairvalueofinvestment
propertyissetoutinnote11,whilstthe
carryingvalueofinvestmentsinjoint
ventureswhichthemselvesinclude
investmentpropertyheldatfairvalueby
thejointventureissetoutatnote13.
Measurement of development property
Thedevelopmentpropertyincluded
withintheGroup’sjointventure
investmentinWestEalingProjectslimited
isconsideredbyManagementtofall
outsidethescopeofinvestmentproperty.
Apropertyintendedforsaleinthe
ordinarycourseofbusinessorinthe
processofconstructionordevelopment
forsuchsale,forexample,property
acquiredexclusivelywithaviewto
subsequentdisposalinthenearfutureor
fordevelopmentandresaleisexpectedto
berecordedundertheaccountingstandard
ofIAS2Inventories.Thedirectorshave
discussedthecommercialapproachwith
thedirectorsoftheunderlyingjoint
ventureandthecurrentplanistosellor
tocompletethedevelopmentandsell.
TheDirectorsthereforeconsiderthekey
judgementofaccountingtreatmentofthe
propertydevelopmentunderIAS2
Inventoriestobecorrect.
IAS2Inventoriesrequirethecapitalised
coststobeheldatthelowerofcostor
netrealisablevalue.At31December
2021,thecostscapitalisedwithinthe
developmentbasedonadirector’s
appraisalforthepropertyestimatedthe
netrealisablevalueatasurplusoverthe
costforthedevelopment.Thedirectors
havereviewedtheunderlyinginputsand
keyassumptionsmadeintheappraisal
andconsiderthemadequate.However,
suchinformationisbynaturesubjectto
uncertainty.Thecostofthedevelopment
propertyissetoutinnote14.
Basis of consolidation
TheGroupaccountsincorporatethe
accountsofBisichiPLCandallofits
subsidiaryundertakings,togetherwith
theGroup’sshareoftheresultsofitsjoint
ventures.Non-controllinginterestsin
subsidiariesarepresentedseparately
fromtheequityattributabletoequity
ownersoftheparentcompany.On
acquisitionofanon-whollyowned
subsidiary,thenon-controlling
shareholders’interestsareinitially
measuredatthenon-controllinginterests’
proportionateshareofthefairvalueof
thesubsidiariesnetassets.
6363BisichiPLC
Financial statements Group accounting policies
Thereafter,thecarryingamountof
non-controllinginterestsistheamountof
thoseinterestsatinitialrecognitionplus
thenon-controllinginterests’shareof
subsequentchangesinequity.For
subsequentchangesinownershipina
subsidiarythatdonotresultinalossof
control,theconsiderationpaidor
receivedisrecognisedentirelyinequity.
Thedefinitionofcontrolassumesthe
simultaneousfulfilmentofthefollowing
threecriteria:
• • Theparentcompanyholdsdecision-
makingpowerovertherelevant
activitiesoftheinvestee,
• • Theparentcompanyhasrightsto
variablereturnsfromtheinvestee,and
• • Theparentcompanycanuseits
decision-makingpowertoaffectthe
variablereturns.
Investeesareanalysedfortheirrelevant
activitiesandvariablereturns,andthe
linkbetweenthevariablereturnsandthe
extenttowhichtheirrelevantactivities
couldbeinfluencedinordertoensurethe
definitioniscorrectlyapplied.
Revenue
TheGroup’srevenuefromcontractswith
customers,asdefinedunderIFRS15,
includescoalrevenueandservicecharge
income.
Coalrevenueisderivedprincipallyfrom
exportrevenueanddomesticrevenue.
Bothexportrevenueanddomestic
revenueisrecognisedwhenthecustomer
hasalegallybindingobligationtosettle
underthetermsofthecontractwhenthe
performanceobligationshavebeen
satisfied,whichisoncecontrolofthe
goodshastransferredtothebuyeratthe
deliverypoint.Forexportrevenuethisis
generallyrecognisedwhentheproductis
deliveredtotheexportterminallocation
specifiedinthecustomercontract,at
whichpointcontrolofthegoodshave
beentransferredtothecustomer.For
domesticcoalrevenuesthisisgenerally
recognisedoncollectionbythecustomer
fromthemineorfromthemine’srail
sidingwhenloadedintotransport,where
thecustomerpaysthetransportation
costs.Fulfilmentcoststosatisfythe
performanceobligationsofcoalrevenues
suchastransportandloadingcosts
bornebytheGroupfromtheminetothe
deliverypointarerecodedinoperating
costs.
Coalrevenueismeasuredbasedon
considerationspecifiedinthecontract
withacustomeronapermetrictonne
basis.Bothexportanddomestic
contractsaretypicallyonaspecifiedcoal
volumebasisandlessthanayearin
duration.Exportcontractsaretypically
linkedtothepriceofFreeonBoard(FOB)
CoalfromRichardsBayCoalTerminal
(API4price).Domesticcontractsare
typicallylinkedtoacontractualprice
agreed.
Servicechargesrecoverablefromtenants
arerecognisedovertimeastheserviceis
rendered.
Leasepropertyrentalincome,asdefined
underIFRS16,isrecognisedintheGroup
incomestatementonastraight-linebasis
overthetermofthelease.Thisincludes
theeffectofleaseincentives.
Expenditure
Expenditureisrecognisedinrespectof
goodsandservicesreceived.Wherecoal
ispurchasedfromthirdpartiesatpointof
extractiontheexpenditureisonly
recognisedwhenthecoalisextracted
andallofthesignificantrisksand
rewardsofownershiphavebeen
transferred.
Investment properties
Investmentpropertiescomprisefreehold
andlongleaseholdlandandbuildings.
Investmentpropertiesarecarriedatfair
valueinaccordancewithIAS40
‘InvestmentProperties’.Propertiesare
recognisedasinvestmentproperties
whenheldforlong-termrentalyields,and
afterconsiderationhasbeengiventoa
numberoffactorsincludinglengthof
lease,qualityoftenantandcovenant,
valueoflease,managementintentionfor
futureuseofproperty,planningconsents
andpercentageofpropertyleased.
Investmentpropertiesarerevalued
annuallybyprofessionalexternal
surveyorsandincludedinthebalance
sheetattheirfairvalue.Gainsorlosses
arisingfromchangesinthefairvaluesof
assetsarerecognisedintheconsolidated
incomestatementintheperiodtowhich
theyrelate.InaccordancewithIAS40,
investmentpropertiesarenot
depreciated.Thefairvalueofthehead
leasesisthenetpresentvalueofthe
currentheadrentpayableonleasehold
propertiesuntiltheexpiryofthelease.
Mining reserves, plant and
equipment and development cost
Thecostofproperty,plantandequipment
comprisesitspurchasepriceandany
costsdirectlyattributabletobringingthe
assettothelocationandcondition
necessaryforittobecapableof
operatinginaccordancewithagreed
specifications.Freeholdlandincluded
withinminingreservesisnotdepreciated.
Otherproperty,plantandequipmentis
statedathistoricalcostlessaccumulated
depreciation.Thecostrecognised
includestherecognitionofany
decommissioningassetsrelatedto
property,plantandequipment.
64 BisichiPLC
Financial statements Group accounting policies
Thepurposeofminedevelopmentisto
establishsecureworkingconditionsand
infrastructuretoallowthesafeand
efficientextractionofrecoverablereserves.
Depreciationonminedevelopmentcostsis
notchargeduntilproductioncommences
ortheassetsareputtouse.On
commencementoffullcommercial
production,depreciationischargedover
thelifeoftheassociatedminereserves
extractableusingtheassetonaunitof
productionbasis.Theunitofproduction
calculationisbasedontonnesminedasa
ratiotoprovenandprobablereservesand
alsoincludesfutureforecastcapital
expenditure.Thecostrecognisedincludes
therecognitionofanydecommissioning
assetsrelatedtominedevelopment.
Post production stripping
Insurfaceminingoperations,theGroup
mayfinditnecessarytoremovewaste
materialstogainaccesstocoalreserves
priortoandafterproductioncommences.
Priortoproductioncommencing,stripping
costsarecapitaliseduntilthepointwhere
theoverburdenhasbeenremovedand
accesstothecoalseamcommences.
Subsequenttoproduction,waste
strippingcontinuesaspartofextraction
processasaminingproductionactivity.
Therearetwobenefitsaccruingtothe
Groupfromstrippingactivityduringthe
productionphase:extractionofcoalthat
canbeusedtoproduceinventoryand
improvedaccesstofurtherquantitiesof
materialthatwillbeminedinfuture
periods.Economiccoalextractedis
accountedforasinventory.The
productionstrippingcostsrelatingto
improvedaccesstofurtherquantitiesin
futureperiodsarecapitalisedasa
strippingactivityasset,ifandonlyif,allof
thefollowingaremet:
• • itisprobablethatthefutureeconomic
benefitassociatedwiththestripping
activitywillflowtotheGroup;
• • theGroupcanidentifythecomponent
oftheorebodyforwhichaccesshas
beenimproved;and
• • thecostsrelatingtothestripping
activityassociatedwiththatcomponent
orcomponentscanbemeasured
reliably.
Indeterminingtherelevantcomponentof
thecoalreserveforwhichaccessis
improved,theGroupcomponentisesits
mineintogeographicallydistinctsections
orphasestowhichthestrippingactivities
beingundertakenwithinthatcomponent
areallocated.Suchphasesare
determinedbasedonassessmentof
factorssuchasgeologyandmine
planning.
TheGroupdepreciatesdeferredcosts
capitalisedasstrippingassetsonaunitof
productionmethod,withreferencethe
tonsminedandreserveoftherelevant
orebodycomponentorphase.Thecost
isrecognisedwithinMinedevelopment
costswithinthebalancesheet.
Other assets and depreciation
Thecost,lessestimatedresidualvalue,of
otherproperty,plantandequipmentis
writtenoffonastraight-linebasisover
theasset’sexpectedusefullife.This
includesthewashingplantandotherkey
surfaceinfrastructure.Residualvalues
andusefullivesarereviewed,and
adjustedifappropriate,ateachbalance
sheetdate.Changestotheestimated
residualvaluesorusefullivesare
accountedforprospectively.Heavy
surfaceminingandotherplantand
equipmentisdepreciatedatvaryingrates
dependinguponitsexpectedusage.
Thedepreciationratesgenerallyapplied
are:
Mining
equipment
5–10percentperannumof
theearlierofitsusefullifeor
thelifeofthemine
Motor
vehicles
25–33percentperannum
Office
equipment
10–33percentperannum
Provisions and contingent liabilities
Provisionsarerecognisedwhenthe
Grouphasapresentobligationasaresult
ofapasteventwhichitisprobablewill
resultinanoutflowofeconomicbenefits
thatcanbereliablyestimated.
Aprovisionforrehabilitationofthemine
isinitiallyrecordedatpresentvalueand
thediscountingeffectisunwoundover
timeasafinancecost.Changestothe
provisionasaresultofchangesin
estimatesarerecordedasanincrease/
decreaseintheprovisionandassociated
decommissioningasset.The
decommissioningassetisdepreciatedin
linewiththeGroup’sdepreciationpolicy
overthelifeofmine.Theprovision
includestherestorationofthe
underground,opencast,surface
operationsandde-commissioningofplant
andequipment.Thetimingandfinalcost
oftherehabilitationisuncertainandwill
dependonthedurationoftheminelife
andthequantitiesofcoalextractedfrom
thereserves.
6565BisichiPLC
Financial statements Group accounting policies
Managementexercisesjudgmentin
measuringtheGroup’sexposuresto
contingentliabilitiesthroughassessing
thelikelihoodthatapotentialclaimor
liabilitywillariseandwherepossiblein
quantifyingthepossiblerangeoffinancial
outcomes.Wherethereisadisputeand
whereareliableestimateofthepotential
liabilitycannotbemade,orwherethe
Group,basedonlegaladvice,considers
thatitisimprobablethattherewillbean
outflowofeconomicresources,no
provisionisrecognised.
Employee benefits
Share based remuneration
Thecompanyoperatesashareoption
scheme.Thefairvalueoftheshare
optionschemeisdeterminedatthedate
ofgrant.Thisfairvalueisthenexpensed
onastraight-linebasisoverthevesting
period,basedonanestimateofthe
numberofsharesthatwilleventuallyvest.
Thefairvalueofoptionsgrantedis
calculatedusingabinomialorBlack-
Scholes-Mertonmodel.Paymentsmade
toemployeesonthecancellationor
settlementofoptionsgrantedare
accountedforastherepurchaseofan
equityinterest,i.e.asadeductionfrom
equity.Detailsoftheshareoptionsin
issuearedisclosedintheDirectors’
RemunerationReportonpage32under
theheadingShareoptionschemeswhich
iswithintheauditedpartofthatreport.
Pensions
TheGroupoperatesadefinedcontribution
pensionscheme.Thecontributions
payabletotheschemeareexpensedinthe
periodtowhichtheyrelate.
Foreign currencies
Monetaryassetsandliabilitiesare
translatedatyearendexchangeratesand
theresultingexchangeratedifferences
areincludedintheconsolidatedincome
statementwithintheresultsofoperating
activitiesifarisingfromtradingactivities,
includinginter-companytradingbalances
andwithinfinancecost/incomeifarising
fromfinancing.
Forconsolidationpurposes,incomeand
expenseitemsareincludedinthe
consolidated income statement at
averagerates,andassetsandliabilities
aretranslatedatyearendexchangerates.
Translationdifferencesarisingon
consolidationarerecognisedinother
comprehensiveincome.Foreignexchange
differencesonintercompanyloansare
recordedinothercomprehensiveincome
whentheloansarenotconsideredas
tradingbalancesandarenotexpectedto
berepaidintheforeseeablefuture.Where
foreignoperationsaredisposedof,the
cumulativeexchangedifferencesofthat
foreignoperationarerecognisedinthe
consolidatedincomestatementwhenthe
gainorlossondisposalisrecognised.
Transactionsinforeigncurrenciesare
translatedattheexchangeraterulingon
thetransactiondate.
Financial instruments
Financialassetsandfinancialliabilitiesare
recognisedintheGroup’sconsolidated
statementoffinancialpositionwhenthe
Groupbecomesapartytothecontractual
provisionsoftheinstrument.
Financial assets
Financialassetsareclassifiedaseither
financialassetsatamortisedcost,atfair
valuethroughothercomprehensive
income(“FVTOCI”)oratfairvaluethrough
profitorloss(“FVPL”)dependinguponthe
businessmodelformanagingthe
financialassetsandthenatureofthe
contractualcashflowcharacteristicsof
thefinancialasset.
Alossallowanceforexpectedcredit
lossesisdeterminedforallfinancial
assets,otherthanthoseatFVPL,atthe
endofeachreportingperiod.TheGroup
appliesasimplifiedapproachtomeasure
thecreditlossallowancefortrade
receivablesusingthelifetimeexpected
creditlossprovision.Thelifetimeexpected
creditlossisevaluatedforeachtrade
receivabletakingintoaccountpayment
history,paymentsmadesubsequentto
yearendandpriortoreporting,past
defaultexperienceandtheimpactofany
otherrelevantandcurrentobservabledata.
TheGroupappliesageneralapproachon
allotherreceivablesclassifiedasfinancial
assets.Thegeneralapproachrecognises
lifetimeexpectedcreditlosseswhenthere
hasbeenasignificantincreaseincredit
risksinceinitialrecognition.
TheGroupderecognisesafinancialasset
whenthecontractualrightstothecash
flowsfromtheassetexpire,orwhenit
transfersthefinancialassetand
substantiallyalltherisksandrewardsof
ownershipoftheassettoanotherparty.
TheGroupderecognisesfinancial
liabilitieswhentheGroup’sobligationsare
discharged,cancelledorhaveexpired.
Bank loans and overdrafts
Bankloansandoverdraftsareincludedas
financialliabilitiesontheGroupbalance
sheetattheamountsdrawnonthe
particularfacilitiesnetoftheunamortised
costoffinancing.Interestpayableon
thosefacilitiesisexpensedasfinance
costintheperiodtowhichitrelates.
66 BisichiPLC
Financial statements Group accounting policies
Lease liabilities
Foranynewcontractsenteredintothe
Groupconsiderswhetheracontractis,or
containsalease.Aleaseisdefinedas‘a
contract,orpartofacontract,that
conveystherighttouseanasset(the
underlyingasset)foraperiodoftimein
exchangeforconsideration’.Toapplythis
definitiontheGroupassesseswhetherthe
contractcontainsanidentifiedassetand
hastherighttoobtainsubstantiallyallof
theeconomicbenefitsfromuseofthe
identifiedassetthroughouttheperiodof
use.
Atleasecommencementdate,theGroup
recognisesaright-of-useassetanda
leaseliabilityonthebalancesheet.
Right-of-useassets,excludingproperty
headleases,havebeenincludedin
property,plantandequipmentandare
measuredatcost,whichismadeupofthe
initialmeasurementoftheleaseliability
andanyinitialdirectcostsincurredbythe
Group.TheGroupdepreciatesthe
right-of-useassetsonastraight-linebasis
fromtheleasecommencementdateto
theearlieroftheendoftheusefullifeof
theright-of-useassetortheendofthe
leaseterm.
Atthecommencementdate,theGroup
measurestheleaseliabilityatthepresent
valueoftheleasepaymentsunpaidat
thatdate,discountedusingtheinterest
rateimplicitintheleaseifthatrateis
readilyavailableortheGroup’s
incrementalborrowingrate.Liabilities
relatingtoshorttermleasesareincluded
withintradeandotherpayables.
Leasepaymentsincludedinthe
measurementoftheleaseliabilityare
madeupoffixedpaymentsandvariable
paymentsbasedonanindexorrate,
initiallymeasuredusingtheindexorrate
atthecommencementdate.Subsequent
toinitialmeasurement,theliabilitywillbe
reducedforpaymentsmadeandincreased
forinterest.Itisre-measuredtoreflect
anyreassessmentormodification.When
theleaseliabilityisre-measured,the
correspondingadjustmentisreflectedin
theright-of-useasset,orprofitandlossif
theright-of-useassetisalreadyreduced
tozero.
Leaseliabilitiesthatariseforinvestment
propertiesheldunderaleaseholdinterest
andaccountedforasinvestmentproperty
areinitiallycalculatedasthepresentvalue
oftheminimumleasepayments,reducing
insubsequentreportingperiodsbythe
apportionmentofpaymentstothelessor.
TheGrouphaselectedtoaccountfor
short-termleasesandleasesoflow-value
assetsusingthepracticalexpedients
availableinIFRS16.Insteadofrecognising
aright-of-useassetandleaseliability,the
paymentsinrelationtotheseare
recognisedasanexpenseinprofitorloss
onastraight-linebasisovertheleaseterm.
Investments
Currentfinancialassetinvestmentsand
otherinvestmentsclassifiedasnon-
current(“Theinvestments”)compriseof
sharesinlistedcompanies.The
investmentsaremeasuredatfairvalue.
Anychangesinfairvaluearerecognised
intheprofitorlossaccountand
accumulatedinretainedearnings.
Trade receivables
Tradereceivablesareaccountedforat
amortisedcost.Tradereceivablesdonot
carryanyinterestandarestatedattheir
nominalvalueasreducedbyappropriate
expectedcreditlossallowancesfor
estimatedrecoverableamountsasthe
interestthatwouldberecognisedfrom
discountingfuturecashpaymentsover
theshortpaymentperiodisnot
consideredtobematerial.
Trade payables
Tradepayablescostarenotinterest
bearingandarestatedattheirnominal
value,astheinterestthatwouldbe
recognisedfromdiscountingfuturecash
paymentsovertheshortpaymentperiod
isnotconsideredtobematerial.
Other financial assets and liabilities
TheGroup’sotherfinancialassetsand
liabilitiesnotdisclosedaboveare
accountedforatamortisedcost.
Joint ventures
Investmentsinjointventures,beingthose
entitiesoverwhoseactivitiestheGroup
hasjointcontrol,asestablishedby
contractualagreement,areincludedat
costtogetherwiththeGroup’sshareof
post-acquisitionreserves,onanequity
basis.Dividendsreceivedarecredited
againsttheinvestment.Jointcontrolis
thecontractuallyagreedsharingofcontrol
overanarrangement,whichexistsonly
whendecisionsaboutrelevantstrategic
and/orkeyoperatingdecisionsrequire
unanimousconsentofthepartiessharing
control.Controloverthearrangementis
assessedbytheGroupinaccordance
withthedefinitionofcontrolunderIFRS
10.Loanstojointventuresareclassified
asnon-currentassetswhentheyarenot
expectedtobereceivedinthenormal
workingcapitalcycle.Tradingreceivables
andpayablestojointventuresare
classifiedascurrentassetsandliabilities.
6767BisichiPLC
Financial statements Group accounting policies
Inventories
Inventoriesarestatedatthelowerofcost
andnetrealisablevalue.Costincludes
materials,directlabourandoverheads
relevanttothestageofproduction.Cost
isdeterminedusingtheweightedaverage
method.Netrealisablevalueisbasedon
estimatedsellingpricelessallfurther
costsofcompletionandallrelevant
marketing,sellinganddistributioncosts.
Impairment
Whenevereventsorchangesin
circumstanceindicatethatthecarrying
amountofanassetmaynotbe
recoverableanassetisreviewedfor
impairment.Thisincludesmining
reserves,plantandequipmentandnet
investmentsinjointventures.Areview
involvesdeterminingwhetherthecarrying
amountsareinexcessoftheir
recoverableamounts.Anasset’s
recoverableamountisdeterminedasthe
higherofitsfairvaluelesscostsof
disposalanditsvalueinuse.Such
reviewsareundertakenonanasset-by-
assetbasis,exceptwhereassetsdonot
generatecashflowsindependentofother
assets,inwhichcasethereviewis
undertakenonacashgeneratingunit
basis.
Ifthecarryingamountofanasset
exceedsitsrecoverableamountan
asset’scarryingvalueiswrittendownto
itsestimatedrecoverableamount(being
thehigherofthefairvaluelesscostto
sellandvalueinuse)ifthatislessthan
theasset’scarryingamount.Anychange
incarryingvalueisrecognisedinthe
comprehensiveincomestatement.
Deferred tax
Deferredtaxisthetaxexpectedtobe
payableorrecoverableondifferences
betweenthecarryingamountsofassets
andliabilitiesinthefinancialstatements
andthecorrespondingtaxbasesusedin
thetaxcomputations,andisaccounted
forusingthebalancesheetliability
method.Deferredtaxliabilitiesare
generallyrecognisedforalltaxable
temporarydifferencesanddeferredtax
assetsarerecognisedtotheextentthatit
isprobablethattaxableprofitswillbe
availableagainstwhichdeductible
temporarydifferencescanbeutilised.In
respectofthedeferredtaxonthe
revaluationsurplus,thisiscalculatedon
thebasisofthechargeablegainsthat
wouldcrystalliseonthesaleofthe
investmentportfolioasatthereporting
date.Thecalculationtakesaccountof
indexationonthehistoricalcostofthe
propertiesandanyavailablecapital
losses.
Deferredtaxiscalculatedatthetaxrates
thatareexpectedtoapplyintheperiod
whentheliabilityissettledortheassetis
realised.Deferredtaxischargedor
creditedintheGroupincomestatement,
exceptwhenitrelatestoitemschargedor
crediteddirectlytoothercomprehensive
income,inwhichcaseitisalsodealtwith
inothercomprehensiveincome.
Dividends
Dividendspayableontheordinaryshare
capitalarerecognisedasaliabilityinthe
periodinwhichtheyareapproved.
Cash and cash equivalents
Cashcomprisescashinhandand
on-demanddeposits.Cashandcash
equivalentscomprisesshort-term,highly
liquidinvestmentsthatarereadily
convertibletoknownamountsofcash
andwhicharesubjecttoaninsignificant
riskofchangesinvalueandoriginal
maturitiesofthreemonthsorless.The
cashandcashequivalentsshowninthe
cashflowstatementarestatednetof
bankoverdraftsthatarerepayableon
demandasperIAS7.Thisincludesthe
structuredtradefinancefacilityheldin
SouthAfricaasdetailedinnote22.
Thesefacilitiesareconsideredtoforman
integralpartofthetreasurymanagement
oftheGroupandcanfluctuatefrom
positivetonegativebalancesduringthe
period.
Segmental reporting
Formanagementreportingpurposes,the
Groupisorganisedintobusiness
segmentsdistinguishablebyeconomic
activity.TheGroup’smaterialbusiness
segmentsareminingactivitiesand
investmentproperties.Thesebusiness
segmentsaresubjecttorisksandreturns
thataredifferentfromthoseofother
businesssegmentsandaretheprimary
basisonwhichtheGroupreportsits
segmentinformation.Thisisconsistent
withthewaytheGroupismanagedand
withtheformatoftheGroup’sinternal
financialreporting.Significantrevenue
fromtransactionswithanyindividual
customer,whichmakesup10percentor
moreofthetotalrevenueoftheGroup,is
separatelydisclosedwithineach
segment.Allcoalexportsaresalesto
coaltradersatRichardBay’sterminalin
SouthAfricawiththerisksandrewards
passingtothecoaltraderattheterminal.
Whilstthecoaltraderswillultimatelysell
thecoalontheinternationalmarketsthe
Companyhasnovisibilityoverthe
ultimatedestinationofthecoal.
Accordingly,theexportsalesare
recordedasSouthAfricanrevenue.
68 BisichiPLC
Financial statements
1. SEGMENTAL REPORTING
2021
Business analysis
Mining
£’000
Property
£’000
Other
£’000
Total
£’000
SignificantrevenuecustomerA 23,206 - - 23,206
SignificantrevenuecustomerB 12,656 - - 12,656
SignificantrevenuecustomerC 6,169 - - 6,169
Otherrevenue 7,195 1,119 175 8,489
Segment revenue 49,226 1,119 175 50,520
Operating(loss)/profitbeforefairvalueadjustments
&exchangemovements
1,695 592 170 2,457
Revaluationofinvestments&exchangemovements (121) 255 812 946
Operating profit and segment result 1,574 847 982 3,403
Segment assets 17,350 12,242 4,319 33,911
Unallocated assets
–Non-currentassets 48
–Cash&cashequivalents 3,018
Total assets excluding investment in joint ventures and assets held for sale 36,977
Segmentliabilities (12,227) (1,522) (5) (13,754)
Borrowings (2,680) (3,839) - (6,519)
Total liabilities (14,907) (5,361) (5) (20,273)
Net assets 16,704
Non segmental assets
–Investmentinjointventures 1,131
Net assets as per balance sheet 17,835
Geographic analysis
United
Kingdom
£’000
South
Africa
£’000
Total
£’000
Revenue 1,294 49,222 50,516
Operatingprofit/(loss)andsegmentresult 687 2,716 3,403
Depreciation (32) (2,539) (2,571)
Non-currentassetsexcludinginvestments 10,748 9,018 19,766
Total net assets 14,400 3,435 17,835
Capitalexpenditure 35 1,781 1,816
Notes to the financial statements
for the year ended 31 December 2021
6969BisichiPLC
Financial statements Notes to the financial statements
1. SEGMENTAL REPORTING CONTINUED
2020
Business analysis
Mining
£’000
Property
£’000
Other
£’000
Total
£’000
SignificantrevenuecustomerA 9,042 - - 9,042
SignificantrevenuecustomerB 7,588 - - 7,588
SignificantrevenuecustomerC 6,291 - - 6,291
Otherrevenue 5,646 1,181 57 6,884
Segment revenue 28,567 1,181 57 29,805
Operating(loss)/profitbeforefairvalueadjustments
&exchangemovements
(4,014) 658 52 (3,304)
Revaluationofinvestments&exchangemovements 39 (1,295) 67 (1,189)
Operating profit and segment result (3,975) (637) 119 (4,493)
Segment assets 19,110 11,891 2,581 33,582
Unallocated assets
–Non-currentassets 45
–Cash&cashequivalents 3,768
Total assets excluding investment in joint ventures and assets held for sale 37,395
Segmentliabilities (11,919) (1,471) (19) (13,409)
Borrowings (5,253) (3,799) - (9,052)
Total liabilities (17,172) (5,270) (19) (22,461)
Net assets 14,934
Non segmental assets
–Investmentinjointventures 1,255
Net assets as per balance sheet 16,189
70 BisichiPLC
Financial statements Notes to the financial statements
1. SEGMENTAL REPORTING CONTINUED
Geographic analysis
United
Kingdom
£’000
South
Africa
£’000
Total
£’000
Revenue 1,238 28,567 29,805
Operatingprofit/(loss)andsegmentresult (931) (3,562) (4,493)
Depreciation (21) (2,172) (2,193)
Non-currentassetsexcludinginvestments 10,516 10,129 20,645
Total net assets 13,279 2,910 16,189
Capitalexpenditure 36 3,435 3,471
2. REVENUE
2021
£’000
2020
£’000
Revenue from contracts with customers:
Coalsalesandprocessing 49,226 28,567
Servicechargesrecoverablefromtenants 130 156
Other:
Rental income 989 1,025
Otherrevenue 175 57
Revenue 50,520 29,805
Segmentalminingrevenueisderivedprincipallyfromcoalsalesandisrecognisedoncethecontrolofthegoodshastransferred
fromtheGrouptothebuyer.Segmentalpropertyrevenueisderivedfromrentalincomeandservicechargesrecoverablefrom
tenants.Thisisconsistentwiththerevenueinformationdisclosedforeachreportablesegment(seenote1).Rentalincomeis
recognisedonastraight-linebasisoverthetermofthelease.Servicechargesrecoverablefromtenantsarerecognisedovertime
astheserviceisrendered.Revenueismeasuredbasedontheconsiderationspecifiedinthecontractwiththecustomerortenant.
3. OPERATING COSTS
2021
£’000
2020
£’000
Mining 38,008 24,645
Property 400 342
Cost of sales 38,408 24,987
Administration 9,655 8,122
Operating costs 48,063 33,109
Thedirectpropertycostsare:
Directpropertyexpense 351 272
Bad debts 49 70
400 342
Operatingcostsaboveincludedepreciationof£2,571,000(2020:£2,193,000).
7171BisichiPLC
Financial statements Notes to the financial statements
4. (LOSS)/GAIN ON REVALUATION OF INVESTMENT PROPERTIES
Thereconciliationoftheinvestment(deficit)/surplustothegainonrevaluationofinvestmentpropertiesintheincomestatementis
setoutbelow:
2021
£’000
2020
£’000
Investmentdeficit 255 (1,313)
Gain/(Loss)onvaluationmovementinrespectofheadleasepayments (26) 18
Loss on revaluation of investment properties 229 (1,295)
5. PROFIT BEFORE TAXATION
Profitbeforetaxationisarrivedataftercharging:
2021
£’000
2020
£’000
Staff costs (see note 29) 7,491 5,890
Depreciation 2,571 2,193
Exchangeloss (121) 39
Feespayabletothecompany’sauditorfortheauditofthecompany’sannualaccounts 51 84
Feespayabletothecompany’sauditoranditsassociatesforotherservices:
Theauditofthecompany’ssubsidiariespursuanttolegislation 37 26
Auditrelatedservices - 4
Non-auditrelatedservices - 2
Decrease/(Increase)invalueofInventory 2,105 (1,128)
Thedirectorsconsidertheauditorswerebestplacedtoprovidetheabovenon-auditandauditrelatedserviceswhichreferto
regulatorymatters.Theauditcommitteereviewsthenatureandextentofnon-auditservicestoensurethatindependenceis
maintained.
6. DIRECTORS’ EMOLUMENTS
Directors’emolumentsareshownintheDirectors’remunerationreportonpage32whichiswithintheauditedpartofthatreport.
7. INTEREST PAYABLE
2021
£’000
2020
£’000
Onbankoverdraftsandbankloans 554 547
Unwindingofdiscount - -
Leaseliabilities 29 26
Otherinterestpayable 216 68
Interest payable 799 641
72 BisichiPLC
Financial statements Notes to the financial statements
8. TAXATION
2021
£’000
2020
£’000
(a) Based on the results for the year:
Currenttax-UK - -
Currenttax-Overseas 750 12
Corporationtax-adjustmentinrespectofprioryear–UK - 2
Currenttax 750 14
Deferredtax 45 (1,416)
Total tax in income statement charge 795 (1,402)
(b) Factors affecting tax charge for the year:
ThecorporationtaxassessedfortheyearisdifferentfromthatatthestandardrateofcorporationtaxintheUnitedKingdomof
19.00%(2020:19%).
Thedifferencesareexplainedbelow:
Profit/Lossonordinaryactivitiesbeforetaxation 2,501 (5,196)
Taxonprofit/lossonordinaryactivitiesat19.00%(2020:19.00%) 475 (987)
Effectsof:
Expensesnotdeductiblefortaxpurposes 49 23
Capitalgains\(losses)ondisposal 20 -
Adjustmenttotaxrate 260 (360)
Otherdifferences (9) (80)
Adjustmentinrespectofprioryears - 2
Total tax in income statement (credit) / charge 795 (1,402)
(c) Analysis of United Kingdom and overseas tax:
UnitedKingdomtaxincludedinabove:
Currenttax - -
Deferredtax 152 (312)
152 (312)
Overseastaxincludedinabove:
Currenttax 750 12
Adjustmentinrespectofprioryears - 2
Currenttax 750 14
Deferredtax (107) (1,104)
643 (1,090)
OverseastaxisderivedfromtheGroup’sSouthAfricanminingoperation.Refertonote1forareportontheGroups’miningand
SouthAfricansegmentalreporting.TheadjustmenttotaxratearisesduetothedeferredtaxrateusedintheUKfortheyearof
25%(2020:19%)andthecorporationtaxrateassessedinSouthAfricafortheyearof28%(2020:28%)beingdifferentfrom
thecorporationtaxrateintheUK.
7373BisichiPLC
Financial statements Notes to the financial statements
9. SHAREHOLDER DIVIDENDS
2021
Per share
2021
£’000
2020
Pershare
2020
£’000
Dividendspaidduringtheyearrelatingtothepriorperiod - - 1.00p 107
Dividendsrelatingtothecurrentperiod:
Proposeddividendfor2021 4p 427 - -
Proposedspecialdividendfor2021 2p 214 - -
6p 641
ThedividendsrelatingtothecurrentperiodarenotaccountedforuntiltheyhavebeenapprovedattheAnnualGeneralMeeting.
10. PROFIT/(LOSS) AND DILUTED PROFIT/(LOSS) PER SHARE
Boththebasicanddilutedprofit/(loss)persharecalculationsarebasedonaprofitaftertaxof£1,491,000(2020:lossof
£3,354,000).Thebasicprofit/(loss)persharehasbeencalculatedonaweightedaverageof10,676,839(2020:10,676,839)
ordinarysharesbeinginissueduringtheperiod.Thedilutedprofitpersharehasbeencalculatedontheweightedaveragenumber
ofsharesinissueof10,676,839(2020:10,676,839)plusthedilutivepotentialordinarysharesarisingfromshareoptionsof21,923
(2020:Nil)totalling10,698,762(2020:10,676,839).
11. INVESTMENT PROPERTIES
Freehold
£’000
Long
Leasehold
£’000
Head
Lease
£’000
Total
£’000
Valuationat1January2021 7, 875 2,395 201 10,471
Revaluation 355 (100) (26) 229
Valuation at 31 December 2021 8,230 2,295 175 10,700
Valuation at 1 January 2020 9,020 2,545 183 11,748
Revaluation (1,145) (150) 18 (1,277)
Valuation at 31 December 2020 7, 8 7 5 2,395 201 10,471
Historicalcost
At 31 December 2021 5,851 728 - 6,579
At31December2020 5,851 728 - 6,579
Longleaseholdpropertiesarethoseforwhichtheunexpiredtermatthebalancesheetdateisnotlessthan50years.All
investmentpropertiesareheldforuseinoperatingleasesandallpropertiesgeneratedrentalincomeduringtheperiod.
FreeholdandLongLeaseholdpropertieswereexternallyprofessionallyvaluedat31Decemberonanopenmarketbasisby:
2021
£’000
2020
£’000
CarterTowler 10,525 10,270
ThevaluationswerecarriedoutinaccordancewiththeStatementsofAssetValuationandGuidanceNotespublishedbyTheRoyal
InstitutionofCharteredSurveyors.
EachyearexternalvaluersareappointedbytheExecutiveDirectorsonbehalfoftheBoard.Thevaluersareselectedbasedupon
theirknowledge,independenceandreputationforvaluingassetssuchasthoseheldbytheGroup.
74 BisichiPLC
Financial statements Notes to the financial statements
11. INVESTMENT PROPERTIES CONTINUED
ValuationsareperformedannuallyandareperformedconsistentlyacrossallinvestmentpropertiesintheGroup’sportfolio.At
eachreportingdateappropriatelyqualifiedemployeesoftheGroupverifyallsignificantinputsandreviewthecomputational
outputs.ValuerssubmittheirreporttotheBoardontheoutcomeofeachvaluationround.
Valuationstakeintoaccounttenure,leasetermsandstructuralcondition.Theinputsunderlyingthevaluationsincludemarketrent
orbusinessprofitability,likelyincentivesofferedtotenants,forecastgrowthrates,yields,EBITDA,discountrates,construction
costsincludinganyspecificsitecosts(forexamplesection106),professionalfees,developer’sprofitincludingcontingencies,
planningandconstructiontimelines,leaseregearcosts,planningriskandsalespricesbasedonknownmarkettransactionsfor
similarpropertiestothosebeingvalued.
Valuationsarebasedonwhatisdeterminedtobethehighestandbestuse.Whenconsideringthehighestandbestuseavaluer
willconsider,onapropertybypropertybasis,itsactualandpotentialuseswhicharephysically,legallyandfinanciallyviable.
Wherethehighestandbestusediffersfromtheexistinguse,thevaluerwillconsiderthecostandlikelihoodofachievingand
implantingthischangeinarrivingatitsvaluation.
ThereareoftenrestrictionsonFreeholdandLeaseholdpropertywhichcouldhaveamaterialimpactontherealisationofthese
assets.Themostsignificantoftheseoccurwhenplanningpermissionorleaseextensionandrenegotiationofusearerequiredor
whenacreditfacilityisinplace.Theserestrictionsarefactoredintheproperty’svaluationbytheexternalvaluer.
IFRS13setsoutavaluationhierarchyforassetsandliabilitiesmeasuredatfairvalueasfollows:
Level1: valuationbasedoninputsonquotedmarketpricesinactivemarkets
Level2: valuationbasedoninputsotherthanquotedpricesincludedwithinlevel1thatmaximisetheuseofobservabledata
directlyorfrommarketpricesorindirectlyderivedfrommarketprices.
Level3: whereoneormoresignificantinputstovaluationsarenotbasedonobservablemarketdata
Theinter-relationshipbetweenkeyunobservableinputsandtheGroups’propertiesisdetailedinthetablebelow:
Class of property
Level 3 Valuation technique
Key
unobservable inputs
Carrying/
fair value
2021
£’000
Carrying/
fairvalue
2020
£’000
Range
(weighted
average)
2021
Range
(weighted
average)
2020
Freehold–external
valuation
Incomecapitalisation Estimatedrental
valuepersqftp.a
8,230 7, 8 75 £6 – £29
(£21)
£6–£27
(£19)
EquivalentYield 8.9% – 14.7%
(11.2%)
9.4%–
16.7%
(11.8%)
Longleasehold–
externalvaluation
Incomecapitalisation Estimatedrental
valuepersqftp.a
2,295 2,395 £9 – £9
(£9)
£8–£8
(£8)
Equivalentyield 9.8% – 9.8%
(9.8%)
8.9%–8.9%
(8.9%)
At 31 December 2021
10,525 10,270
Thereareinterrelationshipsbetweenalltheseinputsastheyaredeterminedbymarketconditions.Theexistenceofanincreasein
morethanoneinputwouldbetomagnifytheinputonthevaluation.Theimpactonthevaluationwillbemitigatedbythe
interrelationshipoftwoinputsinoppositedirections,forexample,anincreaseinrentmaybeoffsetbyanincreaseinyield.
7575BisichiPLC
Financial statements Notes to the financial statements
11. INVESTMENT PROPERTIES CONTINUED
Thetablebelowillustratestheimpactofchangesinkeyunobservableinputsonthecarrying/fairvalueoftheGroup’sproperties:
Estimated rental
value 10% increase
or decrease
Equivalent yield
25 basis point contrac-
tion or expansion
2021
£’000
2020
£’000
2021
£’000
2020
£’000
Freehold–externalvaluation 823 / (823) 788/(788) 203 / (193) 185/(177)
LongLeasehold–externalvaluation 230 / (230) 240/(240) 60 / (57) 69/(65)
12. MINING RESERVES, PLANT AND EQUIPMENT
Mining
reserves
£’000
Mining
equipment
anddevelop-
ment costs
£’000
Motor
vehicles
£’000
Office
equipment
£’000
Total
£’000
Costat1January2021 1,138 28,371 372 174 30,055
Exchangeadjustment (41) (1,059) (11) (4) (1,115)
Additions - 1,772 35 9 1,816
Disposals - (21) - - (21)
Cost at 31 December 2021 1,097 29,063 396 179 30,735
Accumulateddepreciationat1January2021 1,123 18,399 215 144 19,881
Exchangeadjustment (41) (710) (7) (3) (761)
Chargefortheyear 7 2,499 56 9 2,571
Disposals - (21) - - (21)
Accumulated depreciation at 31 December 2021 1,089 20,167 264 150 21,670
Net book value at 31 December 2021 8 8,896 132 29 9,065
Costat1January2020 1,226 26,674 361 175 28,436
Exchangeadjustment (88) (1,733) (25) (6) (1,852)
Additions - 3,430 36 5 3,471
Disposals - - - - -
Cost at 31 December 2020 1,138 28,371 372 174 30,055
Accumulateddepreciationat1January2020 1,212 17,405 171 140 18,928
Exchangeadjustment (89) (1,136) (10) (5) (1,240)
Chargefortheyear - 2,130 54 9 2,193
Disposals - - - - -
Accumulated depreciation at 31 December 2020 1,123 18,399 215 144 19,881
Net book value at 31 December 2020 15 9,972 157 30 10,174
76 BisichiPLC
Financial statements Notes to the financial statements
12. MINING RESERVES, PLANT AND EQUIPMENT CONTINUED
Includedintheabovelineitemsareright-of-useassetsoverthefollowing:
Mining
Equipment
anddevelop-
ment costs
£’000
Motor
vehicles
£’000
Total
£’000
Netbookvalueat1January2021 263 45 308
Additions - 35 35
Exchangeadjustment (6) - (6)
Depreciation (38) (32) (70)
Net book value at 31 December 2021 219 48 267
Netbookvalueat1January2020 52 29 81
Additions 248 36 284
Exchangeadjustment (18) - (18)
Depreciation (19) (20) (39)
Net book value at 31 December 2020 263 45 308
13. INVESTMENTS HELD AS NON-CURRENT ASSETS
2021
Net
investment in
joint
ventures
assets
£’000
2021
Other
£’000
2020
Net
investment
injoint
ventures
assets
£’000
2020
Other
£’000
At1January 1,255 1,746 1,342 287
Shareof(loss)/gainininvestment - 701 - 201
Additions - 1,630 - 1,359
Disposals - (446) - (101)
Shareof(loss)/gaininjointventures (125) - (87) -
Net assets at 31 December 1,130 3,631 1,255 1,746
7777BisichiPLC
Financial statements Notes to the financial statements
13. INVESTMENTS HELD AS NON-CURRENT ASSETS CONTINUED
Otherinvestmentscompriseofthefollowing:
2021
£’000
2020
£’000
Netbookvalueofunquotedinvestments - -
NetbookandmarketvalueofreadilyrealisableinvestmentslistedonstockexchangesintheUnited
Kingdom
1,564 959
Netbookandmarketvalueofreadilyrealisableinvestmentslistedonoverseasstockexchanges 2,067 787
3,631 1,746
14. JOINT VENTURES
Development Physics Limited
ThecompanyownsathirdoftheissuedsharecapitalofDevelopmentPhysicsLimited,anunlistedpropertydevelopmentcompany.
Atyearend,thenegativecarryingvalueoftheinvestmentheldbytheGroupwas£3,000(2020:£Nil).Theremainingtwothirdsis
heldequallybyLondon&AssociatedPropertiesPLCandMetropropRealEstateLtd.DevelopmentPhysicsLimitedisincorporated
inEnglandandWalesanditsregisteredaddressis12LittlePortlandStreet,London,W1W8BJ.Ithasissuedsharecapitalof99
(2020:99)ordinarysharesof£1each.Nodividendswerereceivedduringtheperiod.
Dragon Retail Properties Limited
Thecompanyowns50%oftheissuedsharecapitalofDragonRetailPropertiesLimited,anunlistedpropertyinvestment
company.Atyearend,thecarryingvalueoftheinvestmentheldbytheGroupwas£637,000(2020:£670,000).Theremaining
50%isheldbyLondon&AssociatedPropertiesPLC.DragonRetailPropertiesLimitedisincorporatedinEnglandandWalesand
itsregisteredaddressis12LittlePortlandStreet,London,W1W8BJ.Ithasissuedsharecapitalof500,000(2020:500,000)
ordinarysharesof£1each.Nodividendswerereceivedduringtheperiod.ItholdsaSantanderbankloanof£1.164millionsecured
againstitsinvestmentproperty.Thebankloanof£1.164millionissecuredbywayofafirstchargeonspecificfreeholdpropertyata
valueof£2.08million.Theinterestcostoftheloanis2.75percentabovethebank’sbaserate.Arefinancingofthisloanis
currentlyunderway.TheloanoriginallyexpiredinOctober2020buthasbeenextendedtoApril2022,andthelenderhasoffered
toextendthisfurtherifrequired.Thecompanyhasagreedtermswithanewlendertorefinancethisloaninfullandareexpecting
tocompletethisshortly.
West Ealing Projects Limited
Thecompanyowns50%oftheissuedsharecapitalofWestEalingProjectsLimited,anunlistedpropertydevelopmentcompany.
Atyearend,thecarryingvalueoftheinvestmentheldbytheGroupwas£496,000(2020:£585,000).Theremaining50%isheld
byLondon&AssociatedPropertiesPLC.WestEalingProjectsLimitedisincorporatedinEnglandandWalesanditsregistered
addressis12LittlePortlandStreet,London,W1W8BJ.Ithasissuedsharecapitalof1,000,000(2020:1,000,000)ordinaryshares
of£1each.Nodividendswerereceivedduringtheperiod.
78 BisichiPLC
Financial statements Notes to the financial statements
14. JOINT VENTURES CONTINUED
Development
Physics
£’000
Dragon
£’000
West
Ealing
£’000
2021
£’000
Dragon
£’000
West
Ealing
£’000
2020
£’000
Turnover - 168 58 226 143 192 335
Profitandloss:
(Loss)/Profitbeforedepreciation,
interestandtaxation
(10) (32) (215) (257) (280) 100 (180)
Depreciationandamortisation - (3) - (3) (10) - (10)
(Loss)/Profitbeforeinterestand
taxation
(10) (35) (215) (260) (290) 100 (190)
InterestIncome - - - - - - -
Interestexpense - (31) (1) (32) (28) - (28)
(Loss)/Profitbeforetaxation (10) (66) (216) (292) (318) 100 (218)
Taxation - - 38 38 44 - 44
(Loss)/Profit after taxation (10) (66) (178) (254) (274) 100 (174)
Balance sheet
Non-current assets - 2,091 - 2,091 2,146 - 2,146
Cashandcashequivalents - 27 5 32 12 27 39
Propertyinventory 232 - 7,494 7,7 2 6 - 7,056 7,056
Othercurrentassets 27 374 70 471 460 103 563
Othercurrentliabilities (269) (53) (6,549) (6,871) (92) (5,962) (6,054)
Net current assets (10) 348 1,020 1,358 380 1,224 1,604
Non-currentborrowings - (1,165) (28) (1,193) (1,186) (54) (1,240)
Othernon-currentliabilities - - - - - - -
Net assets at 31 December (10) 1,274 992 2,256 1,340 1,170 2,510
Share of net assets at 31 December (3) 637 496 1,130 670 585 1,255
7979BisichiPLC
Financial statements Notes to the financial statements
15. SUBSIDIARY COMPANIES
Thecompanyownsthefollowingordinarysharecapitalofthesubsidiarieswhichareincludedwithintheconsolidatedfinancial
statements:
Activity
Percentageof
sharecapital Registeredaddress
Countryof
incorporation
Directly held:
MineralProductsLimited Sharedealing 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
Bisichi(Properties)Limited Property 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
BisichiNorthamptonLimited Property 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
BisichiTrusteeLimited Property 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
UrbanFirst(Northampton)Limited Property 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
BisichiMining(Exploration)Limited Holding
company
100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
NinghiMarketingLimited Dormant 90.1% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
BisichiMiningManagement
ServicesLimited
Dormant 100% 12LittlePortlandStreet,London,
W1W8BJ
England
andWales
BisichiCoalMining(Pty)Limited Coalmining 100% SamoraMachelStreet,BethalRoad,
Middelburg,Mpumalanga,1050
SouthAfrica
Indirectly held:
BlackWattleColliery(Pty)Limited Coalmining 62.5% SamoraMachelStreet,BethalRoad,
Middelburg,Mpumalanga,1050
SouthAfrica
SisonkeCoalProcessing(Pty)Limited Coal
processing
62.5% SamoraMachelStreet,BethalRoad,
Middelburg,Mpumalanga,1050
SouthAfrica
BlackWattleKlipfontein(Pty)Limited Coalmining 62.5% SamoraMachelStreet,BethalRoad,
Middelburg,Mpumalanga,1050
SouthAfrica
AmandlaEhtuMineralResource
Development(Pty)Limited
Dormant 70% SamoraMachelStreet,BethalRoad,
Middelburg,Mpumalanga,1050
SouthAfrica
Detailsonthenon-controllinginterestinsubsidiariesareshownundernote27.
80 BisichiPLC
Financial statements Notes to the financial statements
16. INVENTORIES
2021
£’000
2020
£’000
Coal
Washed 1,185 2,924
MiningProduction 59 394
Workinprogress - 111
Other 9 16
1,253 3,445
17. TRADE AND OTHER RECEIVABLES
2021
£’000
2020
£’000
Financial assets falling due within one year:
Tradereceivables 6,328 5,155
Amountowedbyjointventure 1,067 952
Otherreceivables 984 680
Non-financial instruments falling due within one year:
Prepaymentsandaccruedincome 247 171
8,626 6,958
Financialassetsfallingduewithinoneyearareheldatamortisedcost.Thefairvalueoftradeandotherreceivablesapproximates
theircarryingamounts.TheGroupappliesasimplifiedapproachtomeasurethecreditlossallowancefortradereceivablesusing
thelifetimeexpectedcreditlossprovision.Thelifetimeexpectedcreditlossisevaluatedforeachtradereceivabletakinginto
accountpaymenthistory,paymentsmadesubsequenttoyearendandpriortoreporting,pastdefaultexperienceandtheimpactof
anyotherrelevantandcurrentobservabledata.TheGroupappliesageneralapproachonallotherreceivablesclassifiedas
financialassets.Atyearend,theGroupallowancefordoubtfuldebtsprovidedagainsttradereceivableswas£140,000(2020:
£91,000).
18. INVESTMENTS IN LISTED SECURITIES HELD AT FVPL
2021
£’000
2020
£’000
Market value of listed Investments:
ListedinGreatBritain 478 567
ListedoutsideGreatBritain 207 266
685 833
Originalcostoflistedinvestments 846 1,098
Unrealisedsurplus/deficitofmarketvalueversuscost (161) (265)
8181BisichiPLC
Financial statements Notes to the financial statements
19. TRADE AND OTHER PAYABLES
2021
£’000
2020
£’000
Tradepayables 7,171 7,168
Amountsowedtojointventures 156 156
Leaseliabilities(Note31) 65 81
Otherpayables 2,281 1,839
Accruals 844 1,374
DeferredIncome 226 238
10,743 10,856
20. FINANCIAL LIABILITIES – BORROWINGS
Current Non-current
2021
£’000
2020
£’000
2021
£’000
2020
£’000
Bankoverdraft(secured) 2,536 4,846 - -
Bankloan(secured) 130 264 3,853 3,943
2,666 5,110 3,853 3,943
2021
£’000
2020
£’000
Bankoverdraftandloaninstalmentsbyreferencetothebalancesheetdate:
Withinoneyear 2,666 5,110
Fromonetotwoyears 11 128
Fromtwotofiveyears 3,842 3,815
6,519 9,053
Bankoverdraftandloananalysisbyorigin:
UnitedKingdom 3,839 3,799
SouthernAfrica 2,680 5,254
6,519 9,053
InSouthAfrica,anR85milliontradefacilityisheldwithAbsaBankLimitedbySisonkeCoalProcessing(Pty)Limited(“SisonkeCoal
Processing”)inordertocovertheworkingcapitalrequirementsoftheGroup’sSouthAfricanoperations.Theinterestcostofthe
loanisattheSouthAfricanprimelendingrateplus3.8%ThefacilityisrenewableannuallyeachJanuary,isrepayableondemand
andissecuredbywayofafirstchargeoverspecificpiecesofminingequipment,inventoryandthedebtorsoftherelevant
companywhichholdstheloanwhichareincludedinthefinancialstatementsatavalueof£8,843,219.Allbankingcovenantswere
eitheradheredtoorwaivedbyAbsaBankLimitedduringtheyear.
IntheUK,theGroupholdsa£3.96milliontermloanfacilitywithJulianHodgeBankLimited.Theloanissecuredagainstthe
Group’sUKretailpropertyportfolio.ThedebtpackagehasafiveyeartermandisrepayableattheendoftheterminDecember
2024.Inthelastquarterof2021thebaseinterestrateontheloanchangedfromLIBORtotheBankofEnglandbaserate.The
overallinterestcostoftheloanis4.00%abovetheBankofEnglandbaserate.Theloanissecuredbywayofafirstchargeover
theinvestmentpropertiesintheUKwhichareincludedinthefinancialstatementsatavalueof£10,525,000.Nobanking
covenantswerebreachedbytheGroupduringtheyear.
82 BisichiPLC
Financial statements Notes to the financial statements
20. FINANCIAL LIABILITIES – BORROWINGS CONTINUED
Consistentwithothersintheminingandpropertyindustry,theGroupmonitorsitscapitalbyitsgearinglevels.Thisiscalculatedas
thetotalbankloansandoverdraftlessremainingcashandcashequivalentsasapercentageofequity.Atyearendthegearingof
theGroupwascalculatedasfollows:
2021
£’000
2020
£’000
Totalbankloansandoverdraft 6,519 9,053
Lesscashandcashequivalents(excludingoverdraft) (3,018) (3,768)
Net debt 3,501 5,285
Total equity attributable to shareholders of the parent 17,512 16,073
Gearing 20.0% 32.9%
Analysisofthechangesinliabilitiesarisingfromfinancingactivities:
Bank
borrowings
£’000
Bank
overdrafts
£’000
Lease
liabilities
£’000
2021
£’000
Bank
borrowings
£’000
Bank
overdrafts
£’000
Lease
liabilities
£’000
2020
£’000
Balanceat1January 4,207 4,846 508 9,561 4,402 4,842 262 9,506
Exchangeadjustments (10) (138) (6) (154) (56) (330) (18) (404)
Cashmovementsexcluding
exchangeadjustments
(214) (2,172) (57) (2,443) (139) 334 (39) 156
Additions - - 9 9 - - 303 303
Balanceat31December 3,983 2,536 454 6,973 4,207 4,846 508 9,561
21. PROVISION FOR REHABILITATION
2021
£’000
2020
£’000
Asat1January 1,442 1,554
Exchangeadjustment (52) (112)
Increaseinprovision - -
Unwindingofdiscount - -
Asat31December 1,390 1,442
8383BisichiPLC
Financial statements Notes to the financial statements
22. FINANCIAL INSTRUMENTS
Total financial assets and liabilities
TheGroup’sfinancialassetsandliabilitiesareasfollows,representingboththefairvalueandthecarryingvalue:
Financial
Assets
measured
at
amortised
cost
£’000
Financial
Liabilities
measured
at
amortised
cost
£’000
Investments
heldat
FVPL
£’000
2021
£’000
Financial
Assets
measured
at
amortised
cost
£’000
Financial
Liabilities
measured
at
amortised
cost
£’000
Investments
heldat
FVPL
£’000
2020
£’000
Cashandcashequivalents 3,018 - - 3,018 3,768 - - 3,768
Non-currentother
investmentsheldatFVPL
- - 3,631 3,631 - - 1,746 1,746
Investmentsinlisted
securitiesheldatFVPL
- - 685 685 - - 833 833
Tradeandotherreceivables 8,379 - - 8,379 6,787 - - 6,787
Bankborrowingsand
overdraft
- (6,519) - (6,519) - (9,053) - (9,053)
LeaseLiabilities - (454) - (454) - (508) - (508)
Otherliabilities - (11,178) - (11,178) - (10,746) - (10,746)
11,397 (18,151) 4,316 (2,438) 10,555 (20,307) 2,579 (7,173)
Investmentsinlistedsecuritiesheldatfairvaluethroughprofitandlossfallunderlevel1ofthefairvaluehierarchyintowhichfair
valuemeasurementsarerecognisedinaccordancewiththelevelssetoutinIFRS7.Thecomparativefiguresfor2020fallunder
thesamecategoryoffinancialinstrumentas2021.
Thecarryingamountofshortterm(lessthan12months)tradereceivableandotherliabilitiesapproximatetheirfairvalues.Thefair
valueofnon-currentborrowingsinnote20approximatesitscarryingvalueandwasdeterminedunderlevel2ofthefairvalue
hierarchyandisestimatedbydiscountingthefuturecontractualcashflowsatthecurrentmarketinterestratesforUKborrowings
andfortheSouthAfricanoverdraftfacility.Thefairvalueoftheleaseliabilitiesinnote31approximatesitscarryingvalueandwas
determinedunderlevel2ofthefairvaluehierarchyandisestimatedbydiscountingthefuturecontractualcashflowsatthecurrent
marketinterestrates.
Treasury policy
Althoughnoderivativetransactionswereenteredintoduringthecurrentandprioryear,theGroupmayusederivativetransactions
suchasinterestrateswapsandforwardexchangecontractsasnecessaryinordertohelpmanagethefinancialrisksarisingfrom
theGroup’sactivities.ThemainrisksarisingfromtheGroup’sfinancingstructureareinterestraterisk,liquidityrisk,marketrisk,
creditrisk,currencyriskandcommoditypricerisk.Therehavebeennochangesduringtheyearofthemainrisksarisingfromthe
Group’sfinancestructure.Thepoliciesformanagingeachoftheserisksandtheprincipaleffectsofthesepoliciesontheresults
aresummarisedbelow.
Interest rate risk
Interestrateriskistheriskthatthevalueofafinancialinstrumentorcashflowsassociatedwiththeinstrumentwillfluctuatedueto
changesinmarketinterestrates.InterestrateriskarisesfrominterestbearingfinancialassetsandliabilitiesthattheGroupuses.
TreasuryactivitiestakeplaceunderproceduresandpoliciesapprovedandmonitoredbytheBoardtominimisethefinancialrisk
facedbytheGroup.Interestbearingassetscomprisecashandcashequivalentswhichareconsideredtobeshort-termliquid
assetsandloanstojointventures.
84 BisichiPLC
Financial statements Notes to the financial statements
22. FINANCIAL INSTRUMENTS CONTINUED
Interestbearingborrowingscomprisebankloans,bankoverdraftsandvariableratefinanceleaseobligations.Theratesofinterest
varybasedonBankofEnglandintheUKandPRIMEinSouthAfrica.
Asat31December2021,withothervariablesunchanged,a1%increaseordecreaseininterestrates,oninvestmentsand
borrowingswhoseinterestratesarenotfixed,wouldrespectivelychangetheprofit/lossfortheyearby£80,000(2020:£37,000).
Theeffectonequityofthischangewouldbeanequivalentdecreaseorincreasefortheyearof£80,000(2020:£37,000).
Liquidity risk
TheGroup’spolicyistominimiserefinancingrisk.Efficienttreasurymanagementandstrictcreditcontrolminimisethecostsand
risksassociatedwiththispolicywhichensuresthatfundsareavailabletomeetcommitmentsastheyfalldue.Asatyearendthe
GroupheldborrowingfacilitiesintheUKinBisichiPLCandinSouthAfricainBlackWattleColliery(Pty)Ltd.
Thefollowingtablesetsoutthematurityprofileofcontractualundiscountedcashflowsoffinancialliabilitiesasat31December:
2021
£’000
2020
£’000
Withinoneyear 14,122 16,174
Fromonetotwoyears 238 371
Fromtwotofiveyears 4,391 4,268
Beyondfiveyears 129 232
18,880 21,045
Thefollowingtablesetsoutthematurityprofileofcontractualundiscountedcashflowsoffinancialliabilitiesasat31December
maturingwithinoneyear:
2021
£’000
2020
£’000
Withinonemonth 11,509 13,088
Fromonetothreemonths 1,699 2,106
Fromfourtotwelvemonths 914 980
14,122 16,174
InSouthAfrica,anR85milliontradefacilityisheldwithAbsaBankLimitedbySisonkeCoalProcessing(Pty)Limited(“SisonkeCoal
Processing”)inordertocovertheworkingcapitalrequirementsoftheGroup’sSouthAfricanoperations.Theinterestcostofthe
loanisattheSouthAfricanprimelendingrateplus3.8%ThefacilityisrenewableannuallyeachJanuary,isrepayableondemand
andissecuredagainstinventory,debtorsandcashthatareheldbySisonkeCoalProcessing(Pty)Limited.Thefacilityisincluded
incashandcashequivalentswithinthecashflowstatement.
IntheUK,theGroupholdsa£3.96milliontermloanfacilitywithJulianHodgeBankLimited.Theloanissecuredagainstthe
Group’sUKretailpropertyportfolio.ThedebtpackagehasafiveyeartermandisrepayableattheendoftheterminDecember
2024.Inthelastquarterof2021thebaseinterestrateontheloanchangedfromLIBORtotheBankofEnglandbaserate.The
overallinterestcostoftheloanis4.00%abovetheBankofEnglandbaserate.
Asaresultoftheaboveagreedbankingfacilities,theDirectorsbelievethattheGroupiswellplacedtomanageitsliquidityrisk.
8585BisichiPLC
Financial statements Notes to the financial statements
22. FINANCIAL INSTRUMENTS CONTINUED
Credit risk
TheGroupismainlyexposedtocreditriskonitscashandcashequivalents,tradeandotherreceivablesandamountsowedby
jointventuresasperthebalancesheet.Themaximumexposuretocreditriskisrepresentedbythecarryingamountofeach
financialassetinthebalancesheetwhichatyearendamountedto£11,397,000(2020:£10,555,000).
Tomitigateriskonitscashandcashequivalents,theGrouponlydepositssurpluscashwithwell-establishedfinancialinstitutions
ofhighqualitycreditstanding.
TheGroup’screditriskisprimarilyattributabletoitstradereceivables.Tradedebtor’screditratingsarereviewedregularly.TheGroup’s
reviewincludesmeasuressuchastheuseofexternalratingsandestablishingpurchaselimitsforeachcustomer.TheGrouphad
amountsduefromitssignificantrevenuecustomersattheyearendthatrepresented53%(2020:68%)ofthetradereceivables
balance.Theseamountshavebeensubsequentlysettled.TheGroupapproachtomeasurethecreditlossallowancefortrade
receivablesisoutlinedinnote17.Atyearend,theGroupallowancefordoubtfuldebtsprovidedagainsttradereceivableswas£140,000
(2020:£91,000).Asatyearendtheamountoftradereceivablesheldpastduedatelesscreditlossallowanceswas£201,000(2020:
£282,000).Todate,theamountoftradereceivablesheldpastduedatelesscreditlossallowancesthathasnotsubsequentlybeen
settledis£106,000(2020:£155,000).Managementhavenoreasontobelievethatthisamountwillnotbesettled.
TheGroupexposuretocreditriskonitsloanstojointventuresandotherreceivablesismitigatedthroughongoingreviewofthe
underlyingperformanceandresourcesofthecounterpartyincludingevaluationofdifferentscenariosofprobabilityofdefaultand
expectedlossapplicabletoeachoftheunderlyingbalances.
Financial assets maturity
On31December2021,cashatbankandinhandamountedto£3,018,000(2020:£3,768,000)whichisinvestedinshorttermbankdeposits
maturingwithinoneyearbearinginterestatthebank’svariablerates.Cashandcashequivalentsallhaveamaturityoflessthan3months.
Foreign exchange risk
Alltradingisundertakeninthelocalcurrenciesexceptforcertainexportsaleswhichareinvoicedindollars.ItisnottheGroup’s
policytoobtainforwardcontractstomitigateforeignexchangeriskonthesecontractsaspaymenttermsarewithin15daysof
invoiceorearlier.Fundingisalsoinlocalcurrenciesotherthaninter-companyinvestmentsandloansanditisalsonottheGroup’s
policytoobtainforwardcontractstomitigateforeignexchangeriskontheseamounts.During2021and2020theGroupdidnot
hedgeitsexposureofforeigninvestmentsheldinforeigncurrencies.
TheprincipalcurrencyrisktowhichtheGroupisexposedinregardtointer-companybalancesistheexchangeratebetween
PoundssterlingandSouthAfricanRand.ItarisesasaresultoftheretranslationofRanddenominatedinter-companytrade
receivablebalancesheldwithintheUKwhicharepayablebySouthAfricanRandfunctionalcurrencysubsidiaries.
BasedontheGroup’snetfinancialassetsandliabilitiesasat31December2021,a25%strengtheningofSterlingagainstthe
SouthAfricanRand,withallothervariablesheldconstant,woulddecreasetheGroup’sprofitaftertaxationby£218,000(2020:
£360,000).A25%weakeningofSterlingagainsttheSouthAfricanRand,withallothervariablesheldconstantwouldincreasethe
Group’sprofitaftertaxationby£364,000(2020:£601,000).
The25%sensitivityhasbeendeterminedbasedontheaveragehistoricvolatilityoftheexchangerate.
Thetablebelowshowsthecurrencyprofilesofcashandcashequivalents:
2021
£’000
2020
£’000
Sterling 1,397 1,641
SouthAfricanRand 1,017 809
USDollar 604 1,318
3,018 3,768
CashandcashequivalentsearninterestatratesbasedonBankofEnglandratesinSterlingandPrimeinRand.
86 BisichiPLC
Financial statements Notes to the financial statements
22. FINANCIAL INSTRUMENTS CONTINUED
ThetablesbelowshowsthecurrencyprofilesofnetmonetaryassetsandliabilitiesbyfunctionalcurrencyoftheGroup:
2021:
Sterling
£’000
South
African
Rands
£’000
Sterling 1,123 -
SouthAfricanRand 65 (5,088)
USDollar 1,462 -
2,650 (5,088)
2020:
Sterling
£’000
South
African
Rands
£’000
Sterling (70) -
SouthAfricanRand 39 (8,878)
USDollar 1,736 -
1,705 (8,878)
23. DEFERRED TAXATION
2021
£’000
2020
£’000
Asat1January 474 2,071
Recognisedinincome 45 (1,416)
Exchangeadjustment (13) (181)
Asat31December 506 474
Thedeferredtaxbalancecomprisesthefollowing:
Revaluations 641 299
Capitalallowances 2,253 2,478
Shorttermtimingdifference (832) (692)
Unredeemedcapitaldeductions (1,057) (645)
Lossesandotherdeductions (499) (966)
506 474
Refertonote8fordetailsofdeferredtaxrecognisedinincomeinthecurrentyear.Taxratesof25%(2020:19%)intheUKand
28%(2020:28%)inSouthAfricawereutilisedtocalculateyearenddeferredtaxbalances.
8787BisichiPLC
Financial statements Notes to the financial statements
24. SHARE CAPITAL
2021
£’000
2020
£’000
Authorised:13,000,000ordinarysharesof10peach 1,300 1,300
Allottedandfullypaid:
2021
Number of
ordinary
shares
2020
Numberof
ordinary
shares
2021
£’000
2020
£’000
At1Januaryandoutstandingat31December 10,676,839 10,676,839 1,068 1,068
25. OTHER RESERVES
2021
£’000
2020
£’000
Equityshareoptions 621 621
Netinvestmentpremiumonsharecapitalinjointventure 86 86
707 707
26. SHARE BASED PAYMENTS
DetailsoftheshareoptionschemeareshownintheDirectors’remunerationreportonpage33undertheheadingShareoption
schemeswhichiswithintheauditedpartofthisreport.Furtherdetailsoftheshareoptionschemesaresetoutbelow.
TheBisichiPLCUnapprovedOptionSchemes:
Year of grant
Subscription
price per share
Period within
which options
exercisable
Numberofshare
forwhichoptions
outstandingat
31December2020
Numberof
shareoptions
lapsed/surrendered
/awarded
duringyear
Number of
share for which
options
outstanding at
31 December 2021
2015 87.0p Sep 2015 – Sep 2025 300,000 - 300,000
2018 73.50p Feb 2018 – Feb 2028 380,000 - 380,000
Therearenoperformanceorserviceconditionsattachedto2015and2018optionswhichareoutstandingat31December2021.
88 BisichiPLC
Financial statements Notes to the financial statements
26. SHARE BASED PAYMENTS CONTINUED
2021
Number
2021
Weighted
average
exercise
price
2020
Number
2020
Weighted
average
exercise
price
Outstandingat1January 680,000 79.46p 680,000 79.46p
Lapsed/Surrenderedduringtheyear - - - -
Issuedduringtheyear - - - -
Outstandingat31December 680,000 79.46p 680,000 79.46p
Exercisable at 31 December 680,000 79.46p 680,000 79.46p
27. NON-CONTROLLING INTEREST
2021
£’000
2020
£’000
Asat1January 116 625
Shareofprofit/(loss)fortheyear 215 (440)
Dividendspaid - -
Exchangeadjustment (8) (69)
Asat31December 323 116
Thenon-controllinginterestcomprisesofa37.5%interestinBlackWattleColliery(Pty)Ltdanditswhollyownedsubsidiary
SisonkeCoalProcessing(Pty)Ltd.BlackWattleColliery(Pty)LtdisacoalminingcompanyandSisonkeCoalProcessing(Pty)Ltd
isacoalprocessingcompanybothincorporatedinSouthAfrica.Summarisedfinancialinformationreflecting100%ofthe
underlyingconsolidatedrelevantfiguresofBlackWattleColliery(Pty)Ltd’sanditswhollyownedsubsidiarySisonkeCoal
Processing(Pty)Ltdissetoutbelow.
2021
£’000
2020
£’000
Revenue 49,225 28,555
Expenses (47,787) (31,498)
Profit/(loss) for the year 1,438 (2,943)
OthercomprehensiveIncome - -
Total comprehensive income for the year 1,438 (2,943)
Balancesheet
Non-currentassets 9,019 10,130
Currentassets 9,329 9,781
Currentliabilities (14,287) (16,915)
Non-currentliabilities (1,904) (2,224)
Net assets at 31 December 2,157 772
8989BisichiPLC
Financial statements Notes to the financial statements
27. NON-CONTROLLING INTEREST CONTINUED
Thenon-controllinginterestoriginatesfromthedisposalofa37.5%shareholdinginBlackWattleColliery(Pty)Ltdin2010when
thetotalissuedsharecapitalinBlackWattleColliery(Pty)Ltdwasincreasedfrom136sharesto1,000sharesatparofR1(South
AfricanRand)throughthefollowingsharesissue:
- asubscriptionfor489ordinarysharesatparbyBisichiMining(Exploration)Limitedincreasingthenumberofsharesheldfrom
136ordinarysharestoatotalof625ordinaryshares;
- asubscriptionfor110ordinarysharesatparbyVunaniMining(Pty)Ltd;
- asubscriptionfor265“A”sharesatparbyVunaniMining(Pty)Ltd
BisichiMining(Exploration)LimitedisawhollyownedsubsidiaryofBisichiPLCincorporatedinEnglandandWales.
VunaniMining(Pty)LtdisaSouthAfricanBlackEconomicEmpowermentcompanyandminorityshareholderinBlackWattle
Colliery(Pty)Ltd.
The“A”sharesrankparipassuwiththeordinarysharessavethattheywillhavenodividendrightsuntilsuchtimeasthedividends
paidbyBlackWattleColliery(Pty)Ltdontheordinarysharessubsequentto30October2008willequatetoR832,075,000.
Anon-controllinginterestof15%inBlackWattleColliery(Pty)Ltdisrecognisedforallprofitsdistributabletothe110ordinary
sharesheldbyVunaniMining(Pty)Ltdfromthedateofissueoftheshares(18October2010).Anadditionalnon-controlling
interestwillberecognisedforallprofitsdistributabletothe265“A”sharesheldbyVunaniMining(Pty)Ltdaftersuchtimeasthe
profitsavailablefordistribution,inBlackWattleColliery(Pty)Ltd,beforeanypaymentofdividendsafter30October2008,exceeds
R832,075,000.
On12April2022thetotalissuedsharecapitalinBlackWattleColliery(Pty)Ltdwasincreasedfurtherfrom1000sharesto1002
sharesatparofR1throughthefollowingshareissue:
asubscriptionof1“B”ShareatparbyBisichiMining(ExplorationLimited);
asubscriptionof1“B”ShareatparbyVunaniMining(Pty)Ltd
The“B”sharesrankparipassuwiththeordinarysharessavethattheyhavesolerightstothedistributableprofitsattributableto
certainminingreservesheldbyBlackWattleColliery(Pty)Ltd.Anon-controllinginterestisrecognisedforallprofitsdistributableto
the“B”sharesheldbyVunaniMining(Pty)Ltdfromthedateofissueoftheshares(12April2022).
90 BisichiPLC
Financial statements Notes to the financial statements
28. RELATED PARTY TRANSACTIONS
At31December Duringtheyear
Amounts
owed
torelated
party
£’000
Amounts
owed
byrelated
party
£’000
Costs
recharged
(to)/by
related
party
£’000
Cashpaid
(to)/by
related
party
£’000
Related party:
London&AssociatedPropertiesPLC(note(a)) 41 - 200 (192)
WestEalingProjectsLimited(note(b)) - (998) - (158)
DragonRetailPropertiesLimited(note(c)) 156 - (36) 44
DevelopmentPhysicsLimited(note(d)) - (67) - (67)
As at 31 December 2021 197 (1,065) 164 (373)
London&AssociatedPropertiesPLC(note(a)) 43 - 200 (190)
WestEalingProjectsLimited(note(b)) - (952) - (112)
DragonRetailPropertiesLimited(note(c)) 156 - (36) 44
As at 31 December 2020 199 (952) 164 (258)
(a) London & Associated Properties PLC–London&AssociatedPropertiesPLC(“LAP”)isasubstantialshareholderandparent
companyofBisichiPLC.Propertymanagement,officepremises,generalmanagement,accountingandadministrationservices
areprovidedforBisichiPLCanditsUKsubsidiaries.BisichiPLCcontinuestooperateasafullyindependentcompanyand
currentlyLAPownsonly41.52%oftheissuedordinarysharecapital.However,LAPisdeemedunderIFRS10tohave
effectivecontrolofBisichiPLCforaccountingpurposes.
(b) West Ealing Projects Limited –WestEalingProjectsLimited(“WestEaling”)isanunlistedpropertycompanyincorporatedin
EnglandandWales.WestEalingisownedequallybythecompanyandLondon&AssociatedPropertiesPLCandisaccounted
asajointventureandtreatedasanon-currentassetinvestment.
(c) Dragon Retail Properties Limited–(“Dragon”)isownedequallybythecompanyandLondon&AssociatedPropertiesPLC.
Dragonisaccountedasajointventureandistreatedasanon-currentassetinvestment.
(d) Development Physics Limited–DevelopmentPhysicsLimited(“DP”)isanunlistedpropertycompanyincorporatedinEngland
andWales.DPisownedequallybythecompany,London&AssociatedPropertiesPLCandMetropropRealEstateLtdandis
accountedasajointventureandtreatedasanon-currentassetinvestment.
Keymanagementpersonnelcompriseofthedirectorsofthecompanywhohavetheauthorityandresponsibilityforplanning,
directing,andcontrollingtheactivitiesofthecompany.Detailsofkeymanagementpersonnelcompensationandinterestinshare
optionsareshownintheDirectors’RemunerationReportonpages32and33undertheheadingsDirectors’remuneration,Pension
schemesandincentivesandShareoptionschemeswhichiswithintheauditedpartofthisreport.Thetotalemployers’national
insurancepaidinrelationtotheremunerationofkeymanagementwas£189,000(2020:£97,000).In2012aloanwasmadetoone
ofthedirectors,MrARHeller,for£116,000.InterestispayableontheDirector’sLoanatarateof6.14percent.Thereisnofixed
repaymentdatefortheDirector’sLoan.Theloanamountoutstandingatyearendwas£41,000(2020:£41,000)andnorepayment
(2020:£nil)wasmadeduringtheyear.
9191BisichiPLC
Financial statements Notes to the financial statements
28. RELATED PARTY TRANSACTIONS CONTINUED
Thenon-controllinginteresttoVunaniMining(Pty)Ltdisshowninnote27.Inaddition,theGroupholdsaninvestmentinVunani
Limitedwithafairvalueof£45,000(2020:£38,000)andaninvestmentinVunaniCapitalPartners(Pty)Ltdof£38,000(2020:
£nil).BotharerelatedpartiestoVunaniMining(Pty)Ltdandareclassifiedasnon-currentavailableforsaleinvestments.
29. EMPLOYEES
2021
£’000
2020
£’000
Staffcostsduringtheyearwereasfollows:
Salaries 6,995 5,512
Socialsecuritycosts 189 97
Pensioncosts 307 281
Sharebasedpayments - -
7,491 5,890
2021 2020
TheaverageweeklynumbersofemployeesoftheGroupduringtheyearwereasfollows:
Production 214 221
Administration 15 15
229 236
30. CAPITAL COMMITMENTS
2021
£’000
2020
£’000
Commitmentsforcapitalexpenditureapprovedandcontractedforattheyearend - 485
92 BisichiPLC
Financial statements Notes to the financial statements
31. LEASE LIABILITIES AND FUTURE PROPERTY LEASE RENTALS
Theleaseliabilitiesaresecuredbytherelatedunderlyingassets.Theundiscountedmaturityanalysisofleasepaymentsat31
December2021isasfollows:
Mining
Equipment&
Development
costs
£’000
MotorVehi-
cles
£’000
Head
LeaseProp-
erty
£’000
2021
£’000
2020
£’000
Withinoneyear 42 28 13 83 84
Secondtofifthyear 161 21 44 226 236
Afterfiveyears 91 - 1,336 1,427 1,680
294 49 1,393 1,736 2,000
Discountingadjustment (62) (2) (1,218) (1,282) (1,492)
Presentvalue 232 47 175 454 508
Thepresentvalueofminimumleasepaymentsat31December2021isasfollows:
Mining
Equipment&
Development
costs
£’000
MotorVehi-
cles
£’000
Head
LeaseProp-
erty
£’000
2021
£’000
2020
£’000
Withinoneyear(Note19) 27 27 11 65 81
Secondtofifthyear 205 20 35 260 195
Afterfiveyears - - 129 129 232
Presentvalue 232 47 175 454 508
Withtheexceptionofshort-termleasesandleasesoflow-valueunderlyingassets,eachleaseisreflectedonthebalancesheetas
aright-of-useassetandaleaseliability.TheGroupclassifiesitsright-of-useassetsinaconsistentmannertoitsproperty,plant
andequipment.Leaseliabilitiesduewithinoneyearareclassifiedwithintradeandotherpayablesinthebalancesheet.
TheGrouphasoneleaseforminingequipmentinSouthAfricaandoneleaseformotorvehiclesintheUnitedKingdom.Both
leaseshavetermsoflessthan5yearsareeithernon-cancellableormayonlybecancelledbyincurringasubstantivetermination
fee.LeasepaymentsforminingequipmentaresubjecttochangesinconsumerpriceinflationinSouthAfrica.
TheGrouphasoneleasecontractforaninvestmentproperty.Theremainingtermfortheleasedinvestmentpropertyis127years
(2020:128years).Theannualrentpayableisthehigherof£7,500or6.25%oftherevenuederivedfromtheleasedassets.
TheGrouphasenteredintorentalleasesonitsinvestmentpropertyportfolioconsistingmainlyofcommercialproperties.These
leaseshavetermsofbetween1and106years.Allleasesincludeaclausetoenableupwardrevisionoftherentalchargeonan
annualbasisaccordingtoprevailingmarketconditions.
9393BisichiPLC
Financial statements Notes to the financial statements
31. LEASE LIABILITIES AND FUTURE PROPERTY LEASE RENTALS CONTINUED
Thefutureaggregateminimumrentalsreceivableundernon-cancellableoperatingleasesareasfollows:
2021
£’000
2020
£’000
Withinoneyear 948 814
Secondyear 830 711
Thirdyear 776 590
Fourthyear 710 536
Fifthyear 634 471
Afterfiveyears 9,956 9,562
13,854 12,684
32. CONTINGENT LIABILITIES AND POST BALANCE SHEET EVENTS
Bank Guarantees
BankguaranteeshavebeenissuedbythebankersofBlackWattleColliery(Pty)Limitedonbehalfofthecompanytothirdparties.
Theguaranteesaresecuredagainsttheassetsofthecompanyandhavebeenissuedinrespectofthefollowing:
2021
£’000
2020
£’000
Railsiding 48 50
Rehabilitationofminingland 1,700 1,441
Water&electricity 46 48
Contingent tax liability
TheinterpretationoflawsandregulationsinSouthAfricawheretheGroupoperatescanbecomplexandcanleadtochallenges
fromordisputeswithregulatoryauthorities.Suchsituationsoftentakesignificanttimetoresolve.Wherethereisadisputeand
whereareliableestimateofthepotentialliabilitycannotbemade,orwheretheGroup,basedonlegaladvice,considersthatitis
improbablethattherewillbeanoutflowofeconomicresources,noprovisionisrecognised.
BlackWattleColliery(Pty)LtdiscurrentlyinvolvedinataxdisputeinSouthAfricarelatedtoVAT.Thedisputearoseduringthe
yearended31December2020andisrelatedtoeventswhichoccurredpriortotheyearsended31December2020.Asat13April
2022,theGrouphasbeenadvisedthatithasastronglegalcase,thatithascompliedfullywiththelegislationand,therefore,no
economicoutflowisexpectedtooccur.Becauseofthenatureandcomplexityofthedispute,thepossiblefinancialeffectofa
negativedecisioncannotbemeasuredreliably.Accordingly,noprovisionhasbeenbookedattheyearend.Atthisstage,the
Groupbelievesthatthedisputewillberesolvedinitsfavour.
94 BisichiPLC
Financial statements
Notes
2021
£’000
2020
£’000
Fixed assets
Tangibleassets 35 93 90
Investmentinjointventures 36 665 665
Otherinvestments 36 9,987 8,102
10,745 8,857
Current assets
Debtors–amountsduewithinoneyear 37 3,636 4,782
Debtors–amountsdueinmorethanoneyear 37 220 248
Bank balances 788 1,810
4,644 6,840
Creditors–amountsfallingduewithinoneyear 38 (454) (563)
Net current assets 4,190 6,277
Total assets less current liabilities 14,935 15,134
Creditors–amountsfallinginmorethanoneyear 38 (20) (16)
Net assets 14,915 15,118
Capital and reserves
Calledupsharecapital 24 1,068 1,068
Sharepremiumaccount 258 258
Availableforsalereserve - -
Otherreserves 622 622
Retainedearnings 33 12,967 13,170
Shareholders’ funds 14,915 15,118
Thelossforthefinancialyear,beforedividends,was£203,000(2020:profit£83,000)
Thecompanyfinancialstatementswereapprovedandauthorisedforissuebytheboardofdirectorson13April2022andsigned
onitsbehalfby:
A R Heller G J Casey Company Registration No. 112155
Director Director
Company balance sheet
at 31 December 2021
9595BisichiPLC
Financial statements
Company statement of changes in equity
for the year ended 31 December 2021
Share
capital
£’000
Share
premium
£’000
Other
reserve
£’000
Retained
earnings
£’000
Shareholders
funds
£’000
Balanceat1January2020 1,068 258 622 13,194 15,142
Dividendpaid - - - (107) (107)
Profitandtotalcomprehensiveincomefortheyear - - - 83 83
Balance at 1 January 2021 1,068 258 622 13,170 15,118
Dividendpaid - - - - -
Profitandtotalcomprehensiveincomefortheyear - - - (203) (203)
Balance at 31 December 2021 1,068 258 622 12,967 14,915
96 Bisichi PLC
Financial statements
Company accounting policies
for the year ended 31 December 2021
The following are the main accounting
policies of the company:
Basis of preparation
The financial statements have been
prepared in accordance with Financial
Reporting Standard 100 Application of
Financial Reporting Requirements and
Financial Reporting Standard 101
Reduced Disclosure Framework. The
principal accounting policies adopted in
the preparation of the financial
statements are set out below.
The financial statements have been
prepared on a historical cost basis, except
for the revaluation of leasehold property
and certain financial instruments.
Going concern
Details on the Group’s adoption of the
going concern basis of accounting in
preparing the annual financial statements
can be found on page 60.
Disclosure exemptions adopted
In preparing these financial statements
the company has taken advantage of all
disclosure exemptions conferred by FRS
101 as well as disclosure exemptions
conferred by IFRS 2, 7, 13 and 16.
Therefore these financial statements do
not include:
• • certain comparative information as
otherwise required by IFRS;
• • certain disclosures regarding the
company’s capital;
• • a statement of cash flows;
• • the effect of future accounting
standards not yet adopted;
• • the disclosure of the remuneration of
key management personnel; and
• • disclosure of related party transactions
with the company’s wholly owned
subsidiaries.
In addition, and in accordance with FRS
101, further disclosure exemptions have
been adopted because equivalent
disclosures are included in the company’s
Consolidated Financial Statements.
Dividends received
Dividends are credited to the profit and
loss account when received.
Depreciation
Provision for depreciation on tangible
fixed assets is made in equal annual
instalments to write each item off over its
useful life. The rates generally used are:
Office equipment 10 – 33 percent
Joint ventures
Investments in joint ventures, being those
entities over whose activities the Group
has joint control as established by
contractual agreement, are included at
cost, less impairment.
Other Investments
Investments of the company in
subsidiaries are stated in the balance
sheet as fixed assets at cost less
provisions for impairment.
Other investments comprising of shares
in listed companies are classified at fair
value through profit and loss.
Foreign currencies
Monetary assets and liabilities expressed
in foreign currencies have been
translated at the rates of exchange ruling
at the balance sheet date. All exchange
differences are taken to the profit and
loss account.
Financial instruments
Details on the Group’s accounting policy
for financial instruments can be found on
page 65.
Deferred taxation
Details on the Group’s accounting policy
for deferred taxation can be found on
page 67.
Leased assets and liabilities
Details on the Group’s accounting policy
for leased assets and liabilities can be
found on page 66.
Pensions
Details on the Group’s accounting policy
for pensions can be found on page 65.
Share based remuneration
Details on the Group’s accounting policy
for share based remuneration can be
found on page 65. Details of the share
options in issue are disclosed in the
directors’ remuneration report on page
33 under the heading share option
schemes which is within the audited part
of this report.
Notes to the financial statements
9797BisichiPLC
33. PROFIT & LOSS ACCOUNT
AseparateprofitandlossaccountforBisichiPLChasnotbeenpresentedaspermittedbySection408(2)oftheCompaniesAct
2006.Thelossforthefinancialyear,beforedividendspaid,was£203,000(2020:profit:£83,000)
Detailsofsharecapitalaresetoutinnote24oftheGroupfinancialstatementsanddetailsoftheshareoptionsareshowninthe
Directors’RemunerationReportonpage33undertheheadingShareoptionschemeswhichiswithintheauditedpartofthisreport
andnote26oftheGroupfinancialstatements.
34. DIVIDENDS
Detailsondividendscanbefoundinnote9intheGroupfinancialstatements.
35. TANGIBLE FIXED ASSETS
Leasehold
Property
£’000
Motor
Vehicles
£’000
Office
equipment
£’000
Total
£’000
Costat1January2021 45 69 70 184
Additions - 35 - 35
Cost at 31 December 2021 45 104 70 219
Accumulateddepreciationat1January2021 - 24 70 94
Chargefortheyear - 32 - 32
Accumulated depreciation at 31 December 2021 - 56 70 126
Net book value at 31 December 2021 45 48 - 93
Netbookvalueat31December2020 45 45 - 90
Leaseholdpropertyconsistsofasingleunitwithalongleaseholdtenant.Thetermremainingontheleaseis38years.Motor
VehiclescomprisewhollyofRightofUseleasedassets.
36. INVESTMENTS
Joint
ventures
shares
£’000
Sharesin
subsidiaries
£’000
Other
investments
£’000
Total
£’000
Netbookvalueat1January2021 665 6,356 1,746 8,102
Investedduringtheyear - - 1,630 1,630
Repayment - - (446) (446)
Unrealisedsurplus/deficitovercost - - 701 701
Net book value at 31 December 2021 665 6,356 3,631 9,987
Investmentsinsubsidiariesaredetailedinnote15.Intheopinionofthedirectorstheaggregatevalueoftheinvestmentin
subsidiariesisnotlessthantheamountshowninthesefinancialstatements.
Otherinvestmentscompriseof£3,631,000(2020:£1,746,000)sharesinlistedcompanies.
Financial statements Notes to the financial statements
98 BisichiPLC
Financial statements Notes to the financial statements
37. DEBTORS
2021
£’000
2020
£’000
Amounts due within one year:
Amountsduefromsubsidiaryundertakings 2,421 3,709
Otherdebtors 94 85
Jointventure 1,065 952
Prepaymentsandaccruedincome 56 36
3,636 4,782
Amounts due in more than one year:
Deferredtaxation 220 248
220 248
Amountsduewithinoneyearareheldatamortisedcost.TheGroupappliesasimplifiedapproachtomeasurethelossallowance
fortradereceivablesusingthelifetimeexpectedlossprovision.TheGroupappliesageneralapproachonallotherreceivables.The
generalapproachrecogniseslifetimeexpectedcreditlosseswhentherehasbeenasignificantincreaseincreditrisksinceinitial
recognition.Thecompanyhasreviewedandassessedtheunderlyingperformanceandresourcesofitscounterpartiesincludingits
subsidiaryundertakingsandjointventures.
38. CREDITORS
2021
£’000
2020
£’000
Amounts falling due within one year:
Jointventure 156 156
Othertaxationandsocialsecurity 64 63
Othercreditors 164 188
LeaseLiabilities 26 29
Accrualsanddeferredincome 44 127
454 563
Amounts falling due in more than one year:
LeaseLiabilities 20 16
LeaseliabilitiescompriseofleasesonMotorvehicleswithremainingleasesof1-3years.Withtheexceptionofshort-termleases
andleasesoflow-valueunderlyingassets,eachleaseisreflectedonthebalancesheetasaright-of-useassetandaleaseliability.
9999BisichiPLC
Financial statements Notes to the financial statements
39. RELATED PARTY TRANSACTIONS
At31
December Duringtheyear
At31December
Amountsowed
byrelatedparty
£’000
Costs
recharged/
accrued(to)/
byrelated
party
£’000
Cashpaid
(to)/by
relatedparty
£’000
Related party:
BlackWattleColliery(Pty)Ltd(note(a)) (637) (923) 1,617
NinghiMarketingLimited(note(b)) (102) - -
As at 31 December 2021 (739) (923) 1,617
BlackWattleColliery(Pty)Ltd(note(a)) (1,331) (958) -
NinghiMarketingLimited(note(b)) (102) - -
As at 31 December 2020 (1,433) (958) -
(a) Black Wattle Colliery (Pty) Ltd–BlackWattleColliery(Pty)LtdisacoalminingcompanybasedinSouthAfrica.
(b) Ninghi Marketing Limited–NinghiMarketingLimitedisadormantcoalmarketingcompanyincorporatedinEngland&Wales.
BlackWattleColliery(Pty)LtdandNInghiMarketingLimitedaresubsidiariesofthecompany.
Inadditiontotheabove,thecompanyhasissuedacompanyguaranteeofR20,061,917(2020:R20,061,917)(SouthAfricanRand)
tothebankersofBlackWattleColliery(Pty)Ltdinordertocoverbankguaranteesissuedtothirdpartiesinrespectofthe
rehabilitationofminingland.
Aprovisionof£102,000hasbeenraisedagainsttheamountowingbyNinghiMarketingLimitedinprioryearsasthecompanyisdormant.
In2012aloanwasmadetooneofthedirectors,MrARHeller,for£116,000.FurtherdetailsontheloancanbefoundinNote28of
theGroupfinancialstatements.
UnderFRS101,thecompanyhastakenadvantageoftheexemptionfromdisclosingtransactionswithotherwhollyownedGroup
companies.Detailsofotherrelatedpartytransactionsaregiveninnote28oftheGroupfinancialstatements.
41. EMPLOYEES
2021
£’000
2020
£’000
Theaverageweeklynumbersofemployeesofthecompanyduringtheyearwereasfollows:
Directors&administration 5 5
Staffcostsduringtheyearwereasfollows:
Salaries 1,426 758
Socialsecuritycosts 189 97
Pensioncosts 31 28
Sharebasedpayments - -
1,646 883