REGISTERED NUMBER: 07386462 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
FOR |
TSMUK LTD |
REGISTERED NUMBER: 07386462 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
FOR |
TSMUK LTD |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Director | 5 |
Report of the Independent Auditors | 7 |
Consolidated Income Statement | 11 |
Consolidated Other Comprehensive Income | 12 |
Consolidated Balance Sheet | 13 |
Company Balance Sheet | 15 |
Consolidated Statement of Changes in Equity | 16 |
Company Statement of Changes in Equity | 17 |
Consolidated Cash Flow Statement | 18 |
Notes to the Consolidated Cash Flow Statement | 19 |
Notes to the Consolidated Financial Statements | 21 |
TSMUK LTD |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 MARCH 2023 |
DIRECTOR: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
Statutory Auditors |
9 Berners Place |
London |
W1T 3AD |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MARCH 2023 |
The director presents his strategic report of the company and the group for the year ended 31 March 2023. |
The financial statements are reported in United States Dollars |
The Group began its operation on 1st December 2010. |
The Group comprises of TSMUK Ltd ("TSMUK"), an investment company and its two Canadian subsidiaries. Tata Steel Minerals Canada Ltd and TS Canada Capital Ltd. |
Tata Steel Minerals Canada Ltd |
Tata Steel Minerals Canada Ltd (TSMC or the Company) is a subsidiary of Tata Steel Limited (TSL) (82%) (through its step-down subsidiary, TSMUK Limited (TSMUK) and the Government of Quebec (GoQ) (through Investissement Québec (IQ) (18%). The Company's objective is to develop the iron ore mining project in the Menihek Region in Newfoundland and Labrador near Schefferville, Quebec, Canada and to set up a large beneficiation plant (also referred to as Concentrator Project) to beneficiate an average Fe grade of 58% to an Fe grade of 65% and meet the customer requirements of despatches of iron ore with high Fe content (at least >60% Fe content) (collectively, the Project). |
The financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realise its assets and discharge its liabilities in the normal course of operations. |
As a result of the processing and production rates achieved since ramp-up and fine tuning of the plant, management determined that the Company's processing plant achieved commercial production effective 1 July 2020. Consequently, the Company ceased to capitalise all cost and offset all revenue against property plant and equipment. |
TS Canada Capital Ltd |
TS Canada Capital Ltd. (the "Company") was incorporated pursuant to the provisions of the British Columbia Business Corporations Act on 30th October 2012, for the purpose of financing the project of Tata Steel Mineral Canada Ltd. a sister company. |
The financial statements have been prepared on going concern basis, which assumes that the Company will be able to realise its assets and discharge its liabilities in the normal course of operations. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MARCH 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
In the normal course of operations, the Group is exposed to and manages various financial risks.The Group does not enter into financial instrument agreements including derivative financial instruments for speculative purposes. |
The Group's main financial risks and policies are as follows: |
Foreign exchange risk |
Exchange risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Group's functional currency is the US dollar and most expenditures are transacted in Canadian dollar. The Group funds certain foreign currency transactions by buying the foreign currency at the spot rate when required. Consequently, some assets and liabilities are exposed to foreign exchange fluctuation. |
Liquidity risk |
Liquidity risk is the risk that an entity will encounter financial difficulty in meeting obligations associated with financial liabilities. |
The Group has a robust planning and budgeting process which supports the determination of the funds required for Group's operating requirements as well as exploration and development plans. The annual budget is approved by the Board of Directors. Future exploration, development, mining, and processing may require additional financing by way of private or equity offering or debt or sale of part of the Project. If needed, TSMC has access to financial support, as confirmed by a financial support letter, from TSGH to provide the necessary support to the Company to enable it to fund the ongoing funding for the Project over the next 12 months. |
Credit risk |
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. |
The Group manages credit risk through an emphasis on quality in its investment portfolio, which at year-end consists of cash, short-term investments, and term deposits. The cash, short- term investments and term deposits are held through three Canadian chartered banks, and management believes the risk of loss to be remote. |
Price risk |
The Group is exposed to price risk with respect to iron ore prices and significant price declines could cause continued exploration and development to become uneconomical. |
Interest rate risk |
Interest rate risk is the risk that future cash flows of financial instrument will fluctuate because of changes in market interest rates. The Group is exposed to interest rate risk on its LIBOR rate based long-term debt. |
External factors |
The steel industry is highly capital-intensive and is cyclical. Steel demand is expected to continue growing in emerging economies such as India and China. China is an important influence on the global steel market. The sector remains vulnerable to increasing cost-side pressures and operating costs are expected to increase. Quarterly contracted prices of raw materials have added to earnings volatility of non-integrated steel manufacturers. This Volatility had lead to steel manufacturers seeking captive mining resources to safeguard business interests.Several foreign investors have entered into arrangement with small junior mining companies in Quebec. China and India , as well as the USA, are also interested by the quality of resources that can be found in Canada. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MARCH 2023 |
SECTION 172(1) STATEMENT |
The board of directors of TSMUK Ltd consider, both individually and together, that they have acted in the way they consider, in good faith, would be most likely to promote the success of the group for the benefit of its members as a whole (having regard to the stakeholders and matters set out in S172 (1)(a-f) of the Act) in the decision taken during the year ended 31 March 2023. |
- Our plan was designed to have a long-term beneficial impact on the group and to contribute to its success in delivering a better quality, more reliable product to its customer. |
- Our employees are fundamental to the delivery of our plan. We aim to be a responsible employer in our approach to the pay and benefits our employees receive. The health, safety and well-being of our employees is one of our primary considerations. |
- Our plan took into account the impact of the company’s operations on the community and environment and our wider societal responsibilities, and in particular how we impact the region. Several of the proposed performance measures will deliver environment improvements. |
- As the Board of Directors, our intention is to behave responsibly and ensure that management operates the business in a responsible manner, operating within the high standards of business conduct and good governance expected for a business. The intention is to nurture our reputation that reflects our responsible behaviour. |
- As the Board of Directors, our intention is to behave responsibly toward our shareholders and treat them fairly and equally, so they too may benefit from the success of the business. |
ON BEHALF OF THE BOARD: |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
REPORT OF THE DIRECTOR |
FOR THE YEAR ENDED 31 MARCH 2023 |
The director presents his report with the financial statements of the company and the group for the year ended 31 March 2023. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 March 2023. |
DIRECTORS |
Other changes in directors holding office are as follows: |
RELATED PARTY DISCLOSURE |
None of the director's had a material interest at any time during the year in any contracts of significance in relation to the business of the company, other than the transactions reflected in note 26 to the financial statements. |
STREAMLINED ENERGY AND CARBON REPORTING |
The group operates in the UK from one office. As a result their energy consumption is less that the requirement to disclose in the United Kingdom. The major part of the business is generated from Canada and therefore no further information is required to be disclosed in the financial statements. |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | state whether applicable 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 will continue in business. |
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
REPORT OF THE DIRECTOR |
FOR THE YEAR ENDED 31 MARCH 2023 |
AUDITORS |
The auditors, Mehta & Tengra, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
TSMUK LTD |
Opinion |
We have audited the financial statements of TSMUK LTD (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the group's and of the parent company affairs as at 31 March 2023 and of the group's loss for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | 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 Auditors' 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, 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
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 group's and the parent company'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. |
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
TSMUK LTD |
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 Group Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Director. |
We have nothing to report in respect of the following matters where 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 director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page five, the director is 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 director determines 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 director is responsible for assessing the group's and the 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 director either intends to liquidate the group or the parent company or to cease operations, or has no realistic alternative but to do so. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
TSMUK LTD |
Auditors' 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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Identifying and assessing potential risks related to irregularities |
In identifying and assessing risks of material misstatements in respect of irregularities, including fraud and non-compliance and regulations, we considered the following: |
- the nature of the industry and sector, control environment and business performance including the design of company's remuneration policies, key drivers for directors' remuneration, bonus levels and performance targets. |
- results of our enquiries of management about their own identification and assessment of the risks and irregularities; |
- any matters we identified having obtained and reviewed the company's documentation of their policies and procedures relating to: |
- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; |
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; |
- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; |
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified that greatest potential for fraud is revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. |
We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context include the UK Companies Act, pension legislation and tax legislation. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
TSMUK LTD |
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 a Report of the Auditors 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. |
for and on behalf of |
Chartered Accountants |
Statutory Auditors |
9 Berners Place |
London |
W1T 3AD |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED INCOME STATEMENT |
FOR THE YEAR ENDED 31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
TURNOVER | 80,900,466 | 99,518,050 |
Cost of sales | (60,418,650 | ) | (51,901,180 | ) |
GROSS PROFIT | 20,481,816 | 47,616,870 |
Administrative expenses | (121,294,624 | ) | (143,964,768 | ) |
OPERATING LOSS | 5 | (100,812,808 | ) | (96,347,898 | ) |
Derivative financial |
instrument loss | 6 | (1,651,232 | ) | (2,697,560 | ) |
(102,464,040 | ) | (99,045,458 | ) |
Interest receivable and similar income | 31,910 | 17,231 |
(102,432,130 | ) | (99,028,227 | ) |
Interest payable and similar expenses | 7 | (28,762,537 | ) | (8,207,658 | ) |
LOSS BEFORE TAXATION | (131,194,667 | ) | (107,235,885 | ) |
Tax on loss | 8 | - | - |
LOSS FOR THE FINANCIAL YEAR | ( | ) | ( | ) |
Loss attributable to: |
Owners of the parent | (107,588,406 | ) | (87,933,426 | ) |
Non-controlling interests | (23,606,261 | ) | (19,302,459 | ) |
(131,194,667 | ) | (107,235,885 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
LOSS FOR THE YEAR | (131,194,667 | ) | (107,235,885 | ) |
OTHER COMPREHENSIVE INCOME |
Share application | - | 64,594 |
Income tax relating to other comprehensive income | - | - |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX | - | 64,594 |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR | (131,194,667 | ) | (107,171,291 | ) |
Total comprehensive income attributable to: |
Owners of the parent | (131,194,667 | ) | (107,171,291 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED BALANCE SHEET |
31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
FIXED ASSETS |
Intangible assets | 10 | 184,249,949 | 192,530,845 |
Tangible assets | 11 | 437,887,656 | 472,441,636 |
Investments | 12 | 6,341,461 | 6,341,461 |
628,479,066 | 671,313,942 |
CURRENT ASSETS |
Stocks | 13 | 87,194,429 | 74,641,691 |
Debtors | 14 | 24,758,108 | 38,652,965 |
Cash at bank | 15 | 4,995,231 | 4,590,226 |
116,947,768 | 117,884,882 |
CREDITORS |
Amounts falling due within one year | 16 | (123,092,840 | ) | (129,781,384 | ) |
NET CURRENT LIABILITIES | (6,145,072 | ) | (11,896,502 | ) |
TOTAL ASSETS LESS CURRENT LIABILITIES | 622,333,994 | 659,417,440 |
CREDITORS |
Amounts falling due after more than one year | 17 | (1,038,878,581 | ) | (944,767,360 | ) |
NET LIABILITIES | (416,544,587 | ) | (285,349,920 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED BALANCE SHEET - continued |
31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
CAPITAL AND RESERVES |
Called up share capital | 20 | 157 | 157 |
Share application money | 21 | 599,010,428 | 599,010,428 |
Other reserves | 21 | (44,860,690 | ) | (44,860,690 | ) |
Consolidation reserve | 21 | 20,583,288 | 20,583,288 |
Retained earnings | 21 | (945,477,483 | ) | (837,889,077 | ) |
SHAREHOLDERS' FUNDS | (370,744,300 | ) | (263,155,894 | ) |
NON-CONTROLLING INTERESTS | 22 | (45,800,287 | ) | (22,194,026 | ) |
TOTAL EQUITY | (416,544,587 | ) | (285,349,920 | ) |
The financial statements were approved by the director and authorised for issue on 24 April 2024 and were signed by: |
K De - Director |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
COMPANY BALANCE SHEET |
31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
FIXED ASSETS |
Intangible assets | 10 |
Tangible assets | 11 |
Investments | 12 |
CURRENT ASSETS |
Cash at bank | 15 |
CREDITORS |
Amounts falling due within one year | 16 | ( | ) | ( | ) |
NET CURRENT LIABILITIES | ( | ) | ( | ) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year | 17 | ( | ) | ( | ) |
NET LIABILITIES | (98,161,058 | ) | (98,191,375 | ) |
CAPITAL AND RESERVES |
Called up share capital | 20 | 157 | 157 |
Share application money | 21 | 599,010,428 | 599,010,428 |
Other reserves | 21 | (56,226,628 | ) | (56,226,628 | ) |
Retained earnings | 21 | (640,945,015 | ) | (640,975,332 | ) |
SHAREHOLDERS' FUNDS | (98,161,058 | ) | (98,191,375 | ) |
Company's profit/(loss) for the financial year | 30,317 | (32,452 | ) |
The financial statements were approved by the director and authorised for issue on |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 MARCH 2023 |
Called up | Share |
share | Retained | application | Other |
capital | earnings | money | reserves |
$ | $ | $ | $ |
Balance at 1 April 2021 | 157 | (749,955,651 | ) | 598,945,834 | (44,860,690 | ) |
As restated | 157 | (749,955,651 | ) | 598,945,834 | (44,860,690 | ) |
Changes in equity |
Total comprehensive income | - | (87,933,426 | ) | 64,594 | - |
Balance at 31 March 2022 | 157 | (837,889,077 | ) | 599,010,428 | (44,860,690 | ) |
As restated | 157 | (837,889,077 | ) | 599,010,428 | (44,860,690 | ) |
Changes in equity |
Total comprehensive income | - | (107,588,406 | ) | - | - |
Balance at 31 March 2023 | 157 | (945,477,483 | ) | 599,010,428 | (44,860,690 | ) |
Consolidation | Non-controlling | Total |
reserve | Total | interests | equity |
$ | $ | $ | $ |
Balance at 1 April 2021 | 20,583,288 | (175,287,062 | ) | (2,891,567 | ) | (178,178,629 | ) |
Prior year adjustment | - | - | (19,302,459 | ) | (19,302,459 | ) |
As restated | 20,583,288 | (175,287,062 | ) | (22,194,026 | ) | (197,481,088 | ) |
Changes in equity |
Total comprehensive income | - | (87,868,832 | ) | - | (87,868,832 | ) |
Balance at 31 March 2022 | 20,583,288 | (263,155,894 | ) | (22,194,026 | ) | (285,349,920 | ) |
Prior year adjustment | - | - | (23,606,261 | ) | (23,606,261 | ) |
As restated | 20,583,288 | (263,155,894 | ) | (45,800,287 | ) | (308,956,181 | ) |
Changes in equity |
Total comprehensive income | - | (107,588,406 | ) | - | (107,588,406 | ) |
Balance at 31 March 2023 | 20,583,288 | (370,744,300 | ) | (45,800,287 | ) | (416,544,587 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 MARCH 2023 |
Called up | Share |
share | Retained | application | Other | Total |
capital | earnings | money | reserves | equity |
$ | $ | $ | $ | $ |
Balance at 1 April 2021 | 157 | (640,942,880 | ) | 598,945,835 | (56,226,628 | ) | (98,223,516 | ) |
Changes in equity |
Total comprehensive income | - | ( | ) |
Balance at 31 March 2022 | 157 | (640,975,332 | ) | 599,010,428 | (56,226,628 | ) | (98,191,375 | ) |
Changes in equity |
Total comprehensive income | - |
Balance at 31 March 2023 | 157 | (640,945,015 | ) | 599,010,428 | (56,226,628 | ) | (98,161,058 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 MARCH 2023 |
2023 | 2022 |
Notes | $ | $ |
Cash flows from operating activities |
Cash generated from operations | 1 | (84,521,555 | ) | (226,478,993 | ) |
Interest paid | (28,762,537 | ) | (8,207,658 | ) |
Net cash from operating activities | (113,284,092 | ) | (234,686,651 | ) |
Cash flows from investing activities |
Purchase of tangible fixed assets | (3,006,378 | ) | (6,267,202 | ) |
Interest received | 31,910 | 17,231 |
Net cash from investing activities | (2,974,468 | ) | (6,249,971 | ) |
Cash flows from financing activities |
New loans in year | 122,950,797 | 276,139,850 |
Capital repayments in year | (6,287,232 | ) | (33,567,085 | ) |
Net cash from financing activities | 116,663,565 | 242,572,765 |
Increase in cash and cash equivalents | 405,005 | 1,636,143 |
Cash and cash equivalents at beginning of year | 2 | 4,590,226 | 2,954,083 |
Cash and cash equivalents at end of year | 2 | 4,995,231 | 4,590,226 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 MARCH 2023 |
1. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
$ | $ |
Loss before taxation | (131,194,667 | ) | (107,235,885 | ) |
Depreciation charges | 42,150,998 | 44,306,140 |
Finance costs | 28,762,537 | 8,207,658 |
Finance income | (31,910 | ) | (17,231 | ) |
(60,313,042 | ) | (54,739,318 | ) |
Increase in stocks | (12,552,738 | ) | (17,526,391 | ) |
Decrease/(increase) in trade and other debtors | 13,894,857 | (12,383,970 | ) |
Decrease in trade and other creditors | (25,550,632 | ) | (141,829,314 | ) |
Cash generated from operations | (84,521,555 | ) | (226,478,993 | ) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 March 2023 |
31.3.23 | 1.4.22 |
$ | $ |
Cash and cash equivalents | 4,995,231 | 4,590,226 |
Year ended 31 March 2022 |
31.3.22 | 1.4.21 |
$ | $ |
Cash and cash equivalents | 4,590,226 | 2,954,083 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 MARCH 2023 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
At 1.4.22 | Cash flow | At 31.3.23 |
$ | $ | $ |
Net cash |
Cash at bank | 4,590,226 | 405,005 | 4,995,231 |
4,590,226 | 405,005 | 4,995,231 |
Debt |
Finance leases | (6,423,767 | ) | 6,287,232 | (136,535 | ) |
Debts falling due after 1 year | (915,848,505 | ) | (122,950,797 | ) | (1,038,799,302 | ) |
(922,272,272 | ) | (116,663,565 | ) | (1,038,935,837 | ) |
Total | (917,682,046 | ) | (116,258,560 | ) | (1,033,940,606 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
1. | STATUTORY INFORMATION |
TSMUK LTD is limited by shares, registered in England and Wales. The company's registered number and registered office address can be found on the General Information page. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Basis of consolidation |
The group financial statements consolidated those of the company and its subsidiary undertakings drawn up to 31 March 2023. The subsidiary is an entity over which the company has the power to control the financial and operating policies to obtain benefits from its activities. The Group obtains and exercise control through voting rights. |
Currency |
The currency used when reporting was United States Dollar. |
Significant judgements and estimates |
The preparation of financial statements requires management to make estimates and assumptions that affect the amounts recorded in the financial statements and notes to the financial statements. The estimates include the recoverability of mineral properties, the useful life of property and equipment and Canadian income taxes related accounts and credits. These estimates are based on management’s best knowledge of current events and actions that the group may undertake in the future. Actual results may differ from these estimates. |
Cash and cash equivalents |
Cash and cash equivalents include cash and highly liquid short-term investments having a term of three months or less from the acquisition date. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, and other sales taxes. |
Revenue recognition |
Revenue from sale of products (iron-ore) is recognized when control of the products has been transferred, this being when the products are delivered to the customer. Delivery occurs when the product has been shipped or delivered to a specific location as the case may be, the risk of loss has been transferred and either the customer has accepted the products in concordance with the sales contract, or the group has objective evidence that all criteria for acceptance has been satisfied. Sales of product include related ancillary services if any. |
Mineral properties |
The Group capitalized costs, net of tax credits and mining duties credit relating to the acquisition, exploration and development of mineral properties on an area of interest basis until June 30,2020. These expenses are amortized to operations through useful life of 25 years. The Company reviews the carrying values of mineral property interests on a yearly basis by reference to the Project economics, including the timing and effort of the exploration and/or development work, the work programs and exploration results experienced by the Company and others, and the extent to which options have committed, or are expected to commit to, exploration on a property. When it becomes apparent that the carrying value of a property exceeds its estimated net recoverable amount based on the foregoing criteria, an impairment test is performed as further described under Impairment of long-lived assets |
During the construction and commissioning period of the mine, revenue from saleable material produced as part of test production was recorded against the cost of the asset until 30th June 2020. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
1) Plant and Equipment - The Ore Processing plant , transportation infrastructure and equipment and the building and mine are amortised using the units-of-production basis. |
2) Fixture and Fitting - Office equipment and furniture are depreciated on straight-line basic over 18, 36 or 60 months . |
3) Rolling stock - Rolling stock is depreciated on a declining balance of 30% per annum . |
4) Building and mine camp - Straight line over 10 years |
Impairment of long-lived assets |
Long-lived assets are tested for impairment whenever events or circumstances indicate that their carrying value may not be recoverable. An impairment loss is recognised when the carrying amount of the asset exceeds the sum of the undiscounted cash flows resulting from its use and eventual disposition. The impairment loss is measured as the amount by which the carrying amount of the long-lived asset exceeds its fair value. |
Commercial production |
Prior to reaching pre-determined levels of operating capacity intended by management, costs incurred were capitalised as part of mineral properties under development within property, plant and equipment, and proceeds from sales are offset against capitalised costs up the date the asset reaches commercial production after which all capitalisations will be ceased. |
Stocks |
Stocks are stated at the lower of cost and net realisable value. Cost is ascertained on a weighted average basis. Cost comprises direct materials and where applicable direct labour costs and overheads that have been incurred in bringing the inventories to their present location and condition. Net realisable value is the price at which the inventories can be realised in the normal course of business after allowing for the cost of conversion from their existing state to a finished condition and for the cost of marketing. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Deferred taxation |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Commercial production |
Prior to reaching pre-determined levels of operating capacity intended by management, costs incurred were capitalized as part of mineral properties under development within property, plant and equipment, and proceeds from sales are offset against capitalized costs up to the date the asset reaches commercial production after which all capitalisations will be ceased. |
Foreign currencies translation |
The Group's currency of measurement and presentation is the U.S. dollar. Monetary assets and liabilities in foreign currency are translated at the exchange rate in effect at the balance sheet date, whereas non-monetary items are translated at the historical rate. Revenue and expenses are translated at the exchange rate in effect at the transaction date. Gains and losses are included in the statement of earnings and loss. |
Tax credits and mining duties |
The Canadian tax credits and mining duties are recorded as a reduction of the mineral properties during the year in which the costs are incurred, provided that the group is reasonably certain that the Canadian tax credits and mining duties will be received. The tax credits and mining duties claimed and recorded must be examined and approved by the Canadian tax authorities and it is possible that the amount granted will differ from the amount recorded. |
Income taxes |
The Group applies the taxes payable method of accounting for income taxes. |
Provisions |
The Group recognizes the present provision when there is a legal obligation in the period in which it occurred, if a reasonable estimate of the obligation can be made. It is a measured as the best estimate of the expenditure required to settle the obligation. |
Asset retirement obligations |
During the course of acquiring and exploring potential mining properties. The group must comply with Canadian government environmental regulations concerning reclamation requirements. The estimated costs of complying with these requirements will be capitalised as mineral properties and the corresponding liability will be increased accordingly. The carrying value will then be amortised over the life of the related assets on a unit-of-production basis and the related liabilities will accrete to the original value estimate. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
-Measurement of financial instruments |
The group initially measures its financial assets and financial liabilities at fair value except for certain non-arm's-length transactions. Advances and receivable from shareholders are measured at cost. |
-Transaction costs |
The Group recognises its transaction costs in net income in the period incurred. However, financial instruments that will not be subsequently measured at fair value are adjusted by the transaction costs that are directly attributable to their origination, issuance, or assumption. |
- Derivative financial instruments |
The Group holds forward contracts on Iron Ore to protect against changes in market of iron ore based on anticipated transactions. |
As at 31st March, 2023, and 31st March 2022, the Group had not designated any derivative financial instruments as off-setting hedges for accounting purposes and the loss on these contracts at fair value are recorded as expenses in the statement of earnings and loss. |
3. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
$ | $ |
Wages and salaries | 30,310,458 | 31,721,403 |
The average number of employees during the year was as follows: |
2023 | 2022 |
Average number of employees |
4. | DIRECTORS' EMOLUMENTS |
2023 | 2022 |
$ | $ |
Directors' remuneration | - | - |
5. | OPERATING LOSS |
The operating loss is stated after charging/(crediting): |
2023 | 2022 |
$ | $ |
Depreciation - owned assets | 37,560,358 | 36,656,742 |
Mineral Properties amortisation | 8,280,896 | 7,649,399 |
Auditors' remuneration | 10,206 | 23,951 |
Foreign exchange differences | (8,541,951 | ) | (109,964 | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
6. | EXCEPTIONAL ITEMS |
2023 | 2022 |
$ | $ |
Derivative financial |
instrument loss | (1,651,232 | ) | (2,697,560 | ) |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
$ | $ |
Bank loan interest | 28,762,537 | 8,207,658 |
8. | TAXATION |
Analysis of the tax charge |
No liability to UK corporation tax arose for the year ended 31 March 2023 nor for the year ended 31 March 2022. |
Tax effects relating to effects of other comprehensive income |
There were no tax effects for the year ended 31 March 2023. |
2022 |
Gross | Tax | Net |
$ | $ | $ |
Share application | 64,594 | - | 64,594 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
8. | TAXATION - continued |
Taxation |
Tata Steel Minerals Canada Ltd. pays no tax as this company has had a net loss every year since incorporation, except in 2016. |
Tata Steel Mineral UK Ltd. did not pay UK corporation tax during the year. |
The total amount of unused tax losses and income tax reductions, and the amount of deductible temporary differences, for which no future income tax asset has been recognized amounts to |
$356,203,329 ($192,958,257 in 2022) |
The group has unused Canadian Exploration Expenses of $ 273,869,104 ($273,869,104 in 2022) and unused Canadian Development Expenses of $ 942,409 ($942,409 in 2022) |
The Group has earned cumulative Federal investment tax credits ("ITCs") of $50,823,212 ($50,823,212 in 2022) which have not been recorded in these financial statements due to the uncertainty as to whether the Group will be able to utilize them. These ITCs can be carried forward for 20 years and expire as follows: |
$ |
2031 | 71,462 |
2032 | 1,486,977 |
2033 | 5,618,775 |
2034 | 6,988,194 |
2035 | 20,196,938 |
2036 | 16,460,866 |
50,823,212 |
The group has $675,624,605 ($581,657,774 in 2022) of non-capital tax losses, which are available to reduce income taxes in future years and expire as follows: |
$ |
2034 | 17,308,373 |
2035 | 12,428,843 |
2036 | 141,424,204 |
2037 | 10,882,561 |
2038 | 84,817,404 |
2039 | 77,811,757 |
2040 | 91,060,766 |
2041 | 54,217,819 |
2042 | 102,876,191 |
2043 | 82,7966,687 |
675,624,605 |
The Corporation also has capital losses of $ 102,025,940 ($102,025,940 in 2022) that can be carried forward indefinitely and applied only against future capital gains which have not been recorded in these financial statements. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
9. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
10. | INTANGIBLE FIXED ASSETS |
Group |
Mineral |
Properties |
$ |
COST |
At 1 April 2022 |
and 31 March 2023 | 207,022,415 |
AMORTISATION |
At 1 April 2022 | 14,491,570 |
Amortisation for year | 8,280,896 |
At 31 March 2023 | 22,772,466 |
NET BOOK VALUE |
At 31 March 2023 | 184,249,949 |
At 31 March 2022 | 192,530,845 |
Goodwill arose during the consolidation process had been fully impaired. |
Mineral properties |
The Group capitalized costs, net of tax credits and mining duties credit relating to the acquisition, exploration and development of mineral properties on an area of interest basis until June 30,2020. These expenses are amortized to operations through useful life of 25 years. The Group reviews the carrying values of mineral property interests on a yearly basis by reference to the Project economics, including the timing and effort of the exploration and/or development work, the work programs and exploration results experienced by the Group and others, and the extent to which options have committed, or are expected to commit to, exploration on a property. When it becomes apparent that the carrying value of a property exceeds its estimated net recoverable amount based on the foregoing criteria, an impairment test is performed as further described under Impairment of long-lived assets. |
During the construction and commissioning period of the mine, revenue from saleable material produced as part of test production was recorded against the cost of the asset until June 30, 2020. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
11. | TANGIBLE FIXED ASSETS |
Group |
Fixtures |
Plant and | and | Rolling |
machinery | fittings | stock | Totals |
$ | $ | $ | $ |
COST |
At 1 April 2022 | 603,375,775 | 4,473,962 | 958,218 | 608,807,955 |
Additions | 3,006,378 | - | - | 3,006,378 |
At 31 March 2023 | 606,382,153 | 4,473,962 | 958,218 | 611,814,333 |
DEPRECIATION |
At 1 April 2022 | 131,241,729 | 4,413,895 | 710,695 | 136,366,319 |
Charge for year | 37,479,527 | 22,485 | 58,346 | 37,560,358 |
At 31 March 2023 | 168,721,256 | 4,436,380 | 769,041 | 173,926,677 |
NET BOOK VALUE |
At 31 March 2023 | 437,660,897 | 37,582 | 189,177 | 437,887,656 |
At 31 March 2022 | 472,134,046 | 60,067 | 247,523 | 472,441,636 |
The amount for property, plant and equipment under construction is $23,784,846 ($23,838,587 in 2022) and has not been amortized in 2023. |
During the year, we tested long-lived assets for impairment as a result of this test, we determined that no write-down of long-lived assets was required. |
12. | FIXED ASSET INVESTMENTS |
Group | Company |
2023 | 2022 | 2023 | 2022 |
$ | $ | $ | $ |
Shares in group undertakings | - | - |
Loans to group undertakings | - | - |
Other investments not loans | 6,341,461 | 6,341,461 |
6,341,461 | 6,341,461 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
12. | FIXED ASSET INVESTMENTS - continued |
Additional information is as follows: |
Group |
Investments (neither listed nor unlisted) were as follows: |
2023 | 2022 |
$ | $ |
Other asset | 6,341,461 | 6,341,461 |
Company |
Shares in |
group |
undertakin |
$ |
COST |
At 1 April 2022 |
and 31 March 2023 |
NET BOOK VALUE |
At 31 March 2023 |
At 31 March 2022 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiaries |
Registered office: |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
$ | $ |
Aggregate capital and reserves |
Loss for the year | ( | ) | ( | ) |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
12. | FIXED ASSET INVESTMENTS - continued |
Registered office: |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
$ | $ |
Aggregate capital and reserves |
Loss for the year | ( | ) | ( | ) |
Company |
Loans to |
group |
undertakin |
$ |
At 1 April 2022 |
and 31 March 2023 |
Impairment of investment: |
The standalone accounts of TSMC under Canadian GAAP does not show an impairment of the assets (Mineral Properties) of the company. However under FRS102 the Mineral Properties should have been impaired. Therefore, the impairment was only reflected in the consolidated accounts in the year to 31st March 2021. |
Other Assets: |
In July 2012, the Company entered into an agreement with the Sept-Îles Port Authority providing the Company with access to a new multi-user deep-water dock facility. As part of the agreement, TSMC will have a minimum annual shipping capacity of 5 million tons a year for 20 years, with options to renew for four or five-year terms. |
13. | STOCKS |
2023 | 2022 |
$ | $ |
Finished Goods | 47,870,855 | 36,377,921 |
ROM | 22,747,618 | 23,856,815 |
Others | 16,575,956 | 14,406,955 |
87,194,956 | 74,641,691 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group |
2023 | 2022 |
$ | $ |
Sales tax recoverable | 1,934,660 | 4,829,942 |
Amount receivable from NML | 1,205,602 | 2,896,351 |
Interest receivable | 3,960 | 496,915 |
Deposit on contract | 10,674,913 | 12,297,793 |
Prepayments | 10,938,973 | 18,131,964 |
24,758,108 | 38,652,965 |
The amounts due from shareholder corporation (NML) which were transferred to TSMUK following the transfer of NML shares to TSL, are non-interest bearing and due on demand. |
Advances for operational and logistic vendors are non-interest bearing and cleared against subsequent invoice. |
15. | CASH AT BANK |
Group | Company |
2023 | 2022 | 2023 | 2022 |
$ | $ | $ | $ |
Bank account- USD ($) | 4,994,165 | 4,589,072 | 38,611 | 64,660 |
Bank account- CAD ($) | 1,066 | 1,154 | 1,066 | 1,154 |
4,995,231 | 4,590,226 | 39,677 | 65,814 |
Cash and cash equivalents include cash and short-term investments having a term of three months or less from the acquisition date. |
16. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
$ | $ | $ | $ |
Finance leases (see note 19) | 57,256 | 6,275,902 |
Trade creditors | 87,392,602 | 109,511,714 |
Other creditor | - | - | 19,168 | 20,094 |
Accrued expenses | 29,498,454 | 6,551,276 |
Asset retirement obligation | 6,144,528 | 7,442,492 |
123,092,840 | 129,781,384 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
17. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
$ | $ | $ | $ |
Other loans (see note 18) | 1,038,799,302 | 915,848,505 |
Finance leases (see note 19) | 79,279 | 147,865 |
Loan by related company | - | 28,770,990 | 28,770,990 | 28,770,990 |
1,038,878,581 | 944,767,360 |
18. | LOANS |
An analysis of the maturity of loans is given below: |
Group | Company |
2023 | 2022 | 2023 | 2022 |
$ | $ | $ | $ |
Amounts falling due between one and two | years: |
Other loans - 1-2 years | 588,951,423 | 409,948,740 | - |
Amounts falling due between two and five | years: |
Other loans - 2-5 years | - | 56,051,886 |
Preference shares | 449,847,879 | 449,847,879 | 449,847,879 | 449,847,879 |
449,847,879 | 505,899,765 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
18. | LOANS - continued |
Short-term debt |
TSMC has entered into a revolving line credit facility agreement with ICICI bank amounting to US$ 11,773,868 (2022: 12,804,097) (CA$16,000,000). As at March 31, 2023, TSMC has utilized US$ 12,164,849 (equivalent CA$15,200,000). |
Long-term debt and loans payable to related companies: |
2022 | 2022 |
$ | $ |
TSGH- Earmarked for preference share | 84,822,877 | 84,822,877 |
Loan from Investissement Quebec bearing interest at 6.00% due on 30th September 2024. | 42,958,668 | 46,231,384 |
Loan TSGH $205 Mn from shareholder company TSGH bearing interest at 6.13% per annum. Interest accrued on this loan as of March 31,2023 is $12,570,695 and it is included in accrued liabilities as at March 31,2023. | 205,068,429 | - |
Loan TSGH $6.7M from shareholder company TSGH bearing interest at 6.13% per annum. Interest accrued on this loan as of March 31, 2023 is $ 413,009 and it is included in accrued liabilities as at March 31,2023. | 6,737,506 | 6,737,506 |
Loan from TSGH bearing interest at 6.00%. Interest accrued on this loan is $ 8,247.15 and is included in the balance as at March 31, 2022 | - | 24,553,100 |
Loan from Tata Steel Global Procurement Company Pte. Ltd. (TSGP) bearing interest at 6.57%. Interest accrued on this loan during the year is $5,885,583.91 and is included in Accounts payable and accrued liabilities as at March 31, 2022 | - | 51,333,530 |
Loan from a shareholder TSGH bearing interest at 6.13%. Interest incurred on this loan during the year is $ 22,013.38 and is included in accrual liabilities as at March 31, 2022. | - | 65,537,379 |
Loan from TSMUK assigned to TSGH $0,090,479 bearing interest at 6.13% per annum. Interest accrued on this loan as of March 31, 2023 is $5,552,807 and it is included in accrued liabilities as at March 31,2023. | 90,090,479 | - |
Loans received from TSGH $98.84 Mn (Shareholder company) bearing interest at 6.13% per annum received during FY'23. Interest accrued on this loans of March 31, 2023 in $2.1Mn and it is included in accrued liabilities as at March 31,2023. | 98,840,200 | - |
Loan TSGH from shareholder company TSGP bearing interest at 6.13% per annum. Interest accrued on this loan as of March 31,2022 is $ nil and it is disclosed in accrued liabilities as at March 31,2022. | - | 8,059,653 |
Loan $ 25m from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 19,949.51 and is included in accrual liabilities as at March 31, 2022. | - | 20,165,690 |
Loan $ 7m from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 31.33 and is included in accrual liabilities as at March 31, 2022. | - | 93,287 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
18. | LOANS - continued |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 7,197.27 and is included in accrual liabilities as at March 31, 2022 | - | 21,427,456 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 5,581.37 and is included in accrual liabilities as at March 31, 2022 | - | 16,616,630 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 24,876.82 and is included in accrual liabilities as at March 31, 2022 | - | 74,062,027 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 66.82 and is included in accrual liabilities as at March 31, 2022 | - | 198,937 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 814.22 and is included in accrual liabilities as at March 31, 2022 | - | 7,275,975 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 1,145.78 and is included in accrual liabilities as at March 31, 2022 | - | 2,424,066 |
Loan from TSGH bearing interest at 6.13% per annum. Interest accrued on this loan is $ 1,145.78 and is included in accrual liabilities as at March 31, 2022 | - | 3,411,178 |
Loan from AXIS bank, maturity date Oct 31,2026, 6 months LIBOR plus 2.95% p.a. bearing interest at 7.15%. Interest accrued on this loan during the year is $ Nil. Interest is payable every 6 months (last paid on 31st March 2023. | 36,494,547 | 48,659,396 |
565,012,706 | 481,902,347 |
The estimated repayments for the following years ending March 31 are as follows: |
$ |
2024 | 12,164,849 |
2025 | 20,756,583 |
2026 | 20,756,583 |
2027 | 20,756,583 |
2028 | 20,756,583 |
Subsequently | 469,821,525 |
Total | 565,012,706 |
TSMUK holds 82% in TSMC. TSGP is a subsidiary of TSL. |
The loan facility includes certain financial and non-financial covenants. As at 31st March, 2023, the Company was in compliance with all covenants. |
Details of shares shown as liabilities are as follows: |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
18. | LOANS - continued |
value: | $ | $ |
Preference | 1 | 449,847,879 | 449,847,879 |
$ |
Convertible preference shares | 449,847,879 |
The preference share that have not been redeemed retracted or repurchased prior to the tenth anniversary of their date of issue shall be immediately and automatically be converted into fully paid Class A ordinary shares. |
Dividends are payable at the discretion of the directors and shall not exceed 10% of the redemption amount. |
19. | LEASING AGREEMENTS |
2022 | 2021 |
$ | $ |
Other capital lease |
Current portion | 57,256 | 6,275,902 |
Non-current | 79,279 | 147,865 |
Total leasing | 136,535 | 6,423,767 |
Minimum lease payments required in the next five years and subsequently under "the capital lease" are as follows: |
$ |
2024 | 67,450 |
2025 | 58,319 |
2026 | 26,704 |
Subsequently | - |
152,473 |
Interest included in minimum payments | (15,938 | ) |
136,535 |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | $ | $ |
Ordinary | 1.572 | 5 | 157 | 157 |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
21. | RESERVES |
Group |
Share |
Retained | application | Other | Consolidation |
earnings | money | reserves | reserve | Totals |
$ | $ | $ | $ | $ |
At 1 April 2022 | (837,889,077 | ) | 599,010,428 | (44,860,690 | ) | 20,583,288 | (263,156,051 | ) |
Deficit for the year | (107,588,406 | ) | (107,588,406 | ) |
At 31 March 2023 | (945,477,483 | ) | 599,010,428 | (44,860,690 | ) | 20,583,288 | (370,744,457 | ) |
Company |
Share |
Retained | application | Other |
earnings | money | reserves | Totals |
$ | $ | $ | $ |
At 1 April 2022 | (640,975,332 | ) | 599,010,428 | (56,226,628 | ) | (98,191,532 | ) |
Profit for the year | 30,317 | 30,317 |
At 31 March 2023 | (640,945,015 | ) | 599,010,428 | (56,226,628 | ) | (98,161,215 | ) |
GROUP |
Increase/ (Decrease) in: |
Share application money |
This represents additional contribute by the shareholders. |
Other reserve |
The other reserves represent the currency translation of financial statement as at 01 April 2015 from Canadian $ to US$. |
Consolidation reserve: |
The consolidation reserve arose due to the change in minority shareholding from 22.32% to 18% during the year 2020/21 and 6% to 22.32% during the year 2016/17, which resulted in the readjustment of the opening share capital, retained losses and other reserve. |
22. | NON-CONTROLLING INTERESTS |
The minority shareholders own all of the class B and class C shares issued in Tata Steel Minerals Canada Ltd, which represent approximately 18.00% (2022: 18%) of the total issued share capital. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
23. | ULTIMATE PARENT COMPANY |
The group is a wholly owned group headed by 'Tata Steel Limited', a company incorporated and registered in India. |
The immediate parent company of the group is (Tata Steel Global Holdings TSGH) incorporated in Singapore. |
24. | CONTINGENT LIABILITIES |
The Group has entered into Impact Benefit Agreements (IBA) with four First Nations. These "life of mine" agreements promotes and govern a mutually beneficial Project. The IBAs establish the processes and sharing benefits, whereby the First Nations will benefit through training, employment, business opportunities and financial participation in the Project. |
The payments required under these IBAs are as follows: |
$ |
2024 | 2,009,330 |
2025 | 2,357,146 |
2026 | 2,352,816 |
2027 | 2,251,404 |
2028 | 2,431,042 |
Subsequent | 11,139,178 |
Total | 22,540,917 |
25. | COMMITMENTS |
The Group has entered into various agreements for the operating activity to be paid as project milestones are met and has agreed to some take-or-pay obligations that the Company anticipates will be used by its future operations. Based on the Company's assessment, the minimum amounts due in each of the next five years and subsequently under these agreements are as follows: |
$ |
2024 | 16,362,237 |
2025 | 16,362,237 |
2026 | 16,182,665 |
2027 | 16,182,665 |
2028 | 5,056,540 |
Total | 70,146,344 |
The Group is party to claims and lawsuits in the normal course of business. Management believes that the resolution of these claims and lawsuits will not have a material adverse effect on the Company's financial position, loss or cash-flows. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
26. | RELATED PARTY DISCLOSURES |
During the year, the Group incurred transactions with companies under common control and a shareholder company: |
2023 | 2022 |
$ | $ |
Balance sheet accounts |
Tata Steel Global Holding TSGH (Previously called TSGMH) | 84,822,876 | 84,822,876 |
Tata Steel Limited | 515,355 | 489,020 |
Loan payable to TSGH (TSMUK Ltd in FY22 | 90,090,479 | 90,090,479 |
TSGH | 228,524,455 | 129,684,255 |
TSGP Liability related to hedge | 967,151 | 7961,039 |
Tata Steel Global Procurement-TSGP | 82,121,680 | 82,121,680 |
These transactions, concluded in the normal course of operations, are for loans and services provided by subsidiaries and TSL respectively. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
27. | FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES |
In the normal course of operations, the Group is exposed to and manages various financial risks. |
The Group does not enter into financial instrument agreements including derivative financial instruments for speculative purposes. |
The Group's main financial risks and policies are as follows: |
Foreign exchange risk |
Foreign exchange risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The functional currency is the US dollar, but most of the Company's expenditures are transacted in Canadian dollars. Consequently, some assets and liabilities are exposed to foreign exchange fluctuations. |
On March 31, 2023, TSMC had cash in the amount of C$1,239,92 (C$ 4,463,796 in 2022) which has been translated into US dollars at the exchange rate on March 31, 2023. |
On March 31, 2023, TSCC had cash in the amount of C$34,735 (C$ 1,145,635 in 2022) which has been translated into US dollars at the exchange rate on March 31, 2023. |
Liquidity risk |
Liquidity risk is the risk that an entity will encounter financial difficulty in meeting obligations associated with financial liabilities. |
The Group has a robust planning and budgeting process which supports the determination of the funds required for Company's operating requirements as well as exploration and development plans. The annual budget is approved by the Board of Directors. Future exploration, development, mining, and processing may require additional financing by way of private or equity offering or debt or sale of part of the Project. If needed, TSMC has access to financial support, as confirmed by a financial support letter, from TSGMH to provide the necessary support to the Company to enable it to fund the ongoing funding for the Project over the next 12 months. |
Credit risk |
Credit risk is the risk that one party to a party to financial instrument will cause a financial loss for the other party by falling to discharge an obligation. |
The Group manages credit risk through an emphasis on quality in its investment portfolio, which at year-end are cash short-term investments and term deposits are held through three Canadian chartered banks and management believes the risk of loss to be remote. |
Interest rate risk |
Interest rate risk is the risk that future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its LIBOR- based long-term debt. |
Market risk |
Market risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk. |
TSMUK LTD (REGISTERED NUMBER: 07386462) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
28. | ASSET RETIREMENT OBLIGATIONS |
The Group accrued an estimated liability related to the mine rehabilitation and closure plan of the Project based on the total future remediation cost using a 2.81% (2.41% in 2022) discount rate (10 Year Zero Coupon Bond Yield) and a 2% inflation rate. The carrying value will be amortized over the expected mine life of 15 years. |