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Central Asia Metals PLC Proposed acquisition of -50-

22 Sep 2017 6:01 am

SASA has engaged an independent expert to conduct an independent assessment on the environment of the mining activities of SASA and to prepare assessment of the restoration and the relevant costs connected with the mine, tailing site and the mining properties. The calculation was performed on a basis of this independent assessment performed by an environmental technical expert.

The expected current cash flows were projected over the useful life of the mining sites and discounted to 2014 terms using a risk free discount rate. The cost of the relating assets is depreciated over the useful life of the assets and is included in property, plant and equipment. If the estimated discount rate used in the calculation had been 10% lower than management's estimates, the carrying amount of the restoration and decommissioning provision would have been USD 259,161 higher.
   (ii)        Employee retirement benefit provision 

All employers in the Republic of Macedonia are obliged to pay employees minimum severance pay on retirement equal to two months of the average monthly salary applicable in the Country at the time of retirement.
   (iii)       Other employee benefits 

The Lynx Group is also obliged to pay jubilee anniversary awards that correspond to the total number of years of service of the employee. Provisions for termination and retirement obligations are recognized in accordance with actuary calculation in 2016. Basic actuary assumptions are used as follows:
 
                                                                                                          As at 
                                                                                                         1 January 
                                                                                          2015   2014      2014 
                                                                                         -----  -----  ----------- 
 Discount 
  rate................................................................................. 
  ..............                                                                          4.3%   4.8%     5.35% 
 Exacted rate for increasing 
  of salary........................................................                       2.5%   1.5%     2.35% 
 

Retirement benefit obligation is stated at the present value of expected future payments to employees with respect to employment retirement pay. The present value of expected future payments to employees is determined by an independent authorised actuary in accordance with the prevailing rules of actuarial mathematics.
   20.       Borrowings 
 
                                                                                                 2015        2014 
 Borrowings............................................................................... 
  ................................                                                            11,208,226   9,228,567 
                                                                                             ===========  ========== 
                                                                                              11,208,226   9,228,557 
 Current.................................................................................. 
  .....................................                                                       11,208,226   4,209,520 
 Non-current.............................................................................. 
  ................................                                                                     -   5,019,047 
                                                                                             -----------  ---------- 
                                                                                              11,208,226   9,228,557 
                                                                                             ===========  ========== 
 

Borrowings are measured at amortized cost. Borrowings relate to two short-term loans from Ohrid Bank AD Skopje. The first short-term loan was approved in amount of USD 5,504,271 with interest rate of 6.2% per annum and maturing on 1 May 2016. The second short-term loan was issued in amount of USD 6,563,263 with interest rate of 3.5% p.a. with maturity date on 4 January 2016. The loans towards Natixis and Solway Commodities were repaid in 2015 with interest rate of one-month Libor +6% p.a.

The carrying amounts and fair value of the current borrowings are as follows:
 
                                                           Carrying amount             Fair value 
                                                       -----------------------  ----------------------- 
                                                           2015        2014         2015        2014 
                                                       -----------  ----------  -----------  ---------- 
 Ohridska Banka 
  AD Skopje................                             11,208,226           -   11,208,226           - 
 Nataxis Solway.....................................             -   8,904,756            -   8,904,756 
 Soloway Commodities.........................                    -     323,811            -     323,811 
                                                       -----------  ----------  -----------  ---------- 
                                                        11,208,226   9,228,567   11,208,226   9,228,567 
                                                       ===========  ==========  ===========  ========== 
 

The fair value of current borrowings equals their carrying amount, as the impact of discounting is not significant.

The information in relation to the pledge of collateral is presented in Note 13. The carrying amounts of the borrowings are denominated in the following currencies.
 
                                                                                                 2015        2014 
                                                                                             -----------  ---------- 
 MKD.......................................................................................   11,208,226           - 
 ................................... 
 USD...................................................................................... 
  ......................................                                                               -   9,228,567 
                                                                                             -----------  ---------- 
                                                                                              11,208,226   9,228,557 
                                                                                             -----------  ---------- 
 
   21.       Trade and other payables 
 
                                                                                                2015         2014 
 Trade payables 
 Domestic trade 
  payables................................................................................. 
  .......                                                                                     1,473,914    1,412,350 
 Foreign trade 
  payables................................................................................. 
  ..........                                                                                    623,758      469,795 
                                                                                             ----------  ----------- 
 Trade payables                                                                               2,097,672    1,882,145 
                                                                                             ==========  =========== 
 Other current liabilities 
 Dividend 
  liabilities.............................................................................. 
  .....................                                                                               -   62,366,773 
 Employee related 
  liabilities.............................................................................. 
  .......                                                                                       637,843      736,169 
 Concession 
  liability................................................................................ 
  .................                                                                             476,741      570,763 
 Other current 
  liabilities.............................................................................. 
  ..............                                                                                126,103      141,534 
 Other current 
  liabilities.............................................................................. 
  ..........                                                                                  1,240,687   63,815,239 
                                                                                             ----------  ----------- 
 Total                                                                                        3,338,359   65,697,384 
                                                                                             ----------  ----------- 
 

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September 22, 2017 02:01 ET (06:01 GMT)

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