It’s been a whirlwind year for Lionsgold Limited (LON:LION), which was still known by its previous name Kolar Gold this time 12 months ago.
A new management team was brought in last July, which included new chief executive Cameron Parry and executive director Luke Cairns, and a few months later the name officially changed.
Jonnagiri gold project
Alongside its partner, Geomysore Services, a large part of the year ended 30 June was dedicated to the development of the Jonnagiri gold deposit in India.
Post-period end Geomysore – in which Lionsgold has a 21.15% stake valued at £2.93mln – released a preliminary feasibility study which suggested the project has the potential to be an economically robust mine.
The plan is to build an open pit gold mine on the East Block, producing 25,000 ounces of gold a year.
More than just Jonnagiri
The company has another gold asset in Finland and a 50-50 joint venture with TRAC Technology in India. It also owns a 55% direct stake in the business.
TRAC has developed a trading platform called The Real Asset Co (www.therealasset.co.uk) that allows investors to acquire and store physical gold and silver rather than buying into exchange traded funds.
Lionsgold and TRAC aim to tap into India’s borderline obsession with the yellow metal with a platform that should be immediately generate value.
In November, the company was granted an electronic money licence by the UK’s Financial Conduct Authority.
The full commercial version of Goldbloc – the digital gold currency developed by TRAC – is scheduled to be available in the second half of next year.
Finland
In Finland, Lionsgold was recently granted government permission to take a 200 tonne initial test sample at the Kalevala gold deposit.
The idea at Kalevala is to process enough ore to generate just over US$4mln at today’s spot price for the precious metal.
What it then does with the cash is open to discussion between Lionsgold and its partner, Mineral Exploration Network (Finland) Ltd.
Helping Lionsgold size up its options will be former Rio Tinto executive Alan Davies, who was recently appointed as global strategy consultant.
Davies was formerly chief executive of Energy & Minerals at Rio Tinto PLC (LON:RIO).
Cash in the bank
For the 12 months ended 30 June, Lionsgold recorded loss before tax of of £862,000 (2016: £931,000).
During that period it raised £1.45mln from investors in two separate share placings which left it with £565,000 in the bank at the end of June.
That figure is likely to be a little higher given Lionsgold raised £750,000 at the end of November.
“This was a period of resetting the Company's operations and strategic direction from the original proposition that the Company's mid-2011 IPO was based upon,” said CEO Parry.
“It has been a busy time since the change in management at the end of July 2016 and the Lionsgold Board believes we are heading into a very exciting year for the group.”
Lionsgold shares jumped 8.9% to 3.54p on Monday.