REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Financial Statements for the Year Ended 31 December 2023 |
for |
CGN Global Uranium Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Financial Statements for the Year Ended 31 December 2023 |
for |
CGN Global Uranium Limited |
CGN Global Uranium Limited (Registered number: 09142456) |
Contents of the Financial Statements |
for the Year Ended 31 December 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Director | 6 |
Statement of Director's Responsibilities | 8 |
Report of the Independent Auditors | 9 |
Statement of Comprehensive Income | 12 |
Balance Sheet | 13 |
Statement of Changes in Equity | 14 |
Notes to the Financial Statements | 15 |
CGN Global Uranium Limited |
Company Information |
for the Year Ended 31 December 2023 |
DIRECTOR: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Certified Accountants |
and Statutory Auditors |
9 St Clare Street |
London |
EC3N 1LQ |
CGN Global Uranium Limited (Registered number: 09142456) |
Strategic Report |
for the Year Ended 31 December 2023 |
The director presents his strategic report for the year ended 31 December 2023. |
REVIEW OF BUSINESS |
The company's key financial indicators during the year were as follows: |
The company's turnover amounted to $731,437,000 (2022: $297,138,000). |
The company's operating profit margin amounted to 2.06% (2022: 3.00%). |
The company's profit before tax amounted to $6,912,000 (2022: $9,484,000). |
The company's gross assets amounted to $154,031,000 (2022: $273,517,000) and net current assets amounted to $36,441,000 (2022: $29,500,000). |
The company's cash balance amounted to $55,749,000 (2022:$1,327,000). |
The uranium spot price took a leap in 2023, rising from below US$50 per pound to close the year above US$90. |
Uranium's sizeable price jump in 2023 came as various supply and demand factors converged. |
Excess inventory created by the Fukushima incident has finally dried up, and nuclear utilities are ready to sign new long-term contracts with uranium producers. Plus, uranium fund keeps buying inventory throughout 2023. However, material isn't necessarily readily available because many companies cut output or took their mines offline entirely when uranium prices were lower, and restarting production need more time to rump up. |
Adding complexity is the growing emphasis on supply chain security and geopolitical situation. The war between Russia and Ukraine had made countries like the US looking to reduce their dependence on Russia, which contribute to more supply backdrop. Against that supply backdrop, uranium demand continued to grow this past year and is set to increase substantially moving forward. |
The trend where uranium prices could continue in 2024 remains uncertain, the question is whether the commodity will continue to rise steadily or spike higher like it did in the last cycle. The uncertainty of Fed's policy on interest rate also makes the price forecast more difficult. |
During the period under review the company focused on risk management and cautious operation, building its customer base by entering contracts for the purchase and sale of uranium. |
CGN Global Uranium Limited (Registered number: 09142456) |
Strategic Report |
for the Year Ended 31 December 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
Market risk |
The natural uranium is stored at conversion facilities in Europe, Canada and North America and is covered by appropriate insurance for risk of loss or damage. All the purchase and sales deliveries are made by book transfer from company's accounts with entitlement credits and no uranium material is physically shipped by the company. |
Majority of uranium material inventory is sold under contracts with the uranium prices locked in, so the market price relationship is irrelevant to the locked contracts. When the company enters a uranium trade the purchase and the sales price is agreed simultaneously so the price changes won't have impact on those prices locked contracts. |
The company has strict authorization management regulations and require company not to speculate on the market and trade with a minimum amount of exposure to price risks. The directors' opinion is that the market risk does not currently present a significant risk to the company under current market conditions. |
Liquidity risk |
A characteristic of the industry is that sales and purchase commitments maybe entered into several years before deliveries are made and this can put pressure on the company's liquidity. This risk is mitigated by careful cash management, detailed cash flow forecasting and timing purchases and sales to optimise cash flows. |
The company uses borrowing facilities with low-margined interest rates and less borrowings so interest rate risks are not considered to be significant. However, the rising interest rates has impacted customers purchasing power and therefore our sales volumes. This is not expected to be a long term trend and customers stopped buying uranium temporarily. |
We do not believe there are any other significant risks and uncertainties facing our business, other than those normally encountered within our industry such as interest rates fluctuation, foreign currency volatility, credit risks and liquidity risks. |
CGN Global Uranium Limited (Registered number: 09142456) |
Strategic Report |
for the Year Ended 31 December 2023 |
SECTION 172(1) STATEMENT |
Section 172 of the Companies Act 2006 requires a director of a company to act in the way he or she considers, in good faith, would most likely promote the success of the company for the benefit of its members as a whole but having regard to a range of factors set out in section 172(1)(a) - (f) in the Companies Act 2006. The Director considers, both individually and collectively, that they have acted in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole in the decisions taken during the year ended 31 December 2023. The Director acknowledges that every decision it makes will not necessarily result in a positive outcome for all the company's stakeholders. In considering the Company's purpose, vision and values, together with its strategic priorities and having a process in place for decision-making the Director does, however, aim to make sure that its decisions are consistent and reasonable. |
S172(1)(A) The likely consequence of any decision in the long term |
The Director understands the business and the environment in which the Company operates, including the challenges of navigating through the energy industry. The Company's purpose is to work towards and continue to be a top trading entity in the global uranium market with a wide outreach to counterparties globally. As the world further decarbonized and nuclear plays an increasingly important role in the world, The Director recognises the need for a sustainable and diversified supply source of uranium should be paramount. the Director has taken the decisions they believe best support the Company's long term strategic vision. |
S172(1)(B) The interests of the company's employees |
For caring for employees, the Company considers its employees as the most valued asset. Therefore, the Company strives to provide its employees with a positive, safe, healthy and fulfilling workplace to ensure the overall development and happiness of its employees, including provide the extensive training and development opportunities for employees to improve their skills and knowledge as well as to promote their career development. We respect the labour rights and human rights of all employees, maintain high ethical standards, and promote an inclusive culture within the Company. We continue to organize "caring for employee" activities regularly, and setup opinion channels for employees. |
S172(1)(C) |
The need to foster the company's business relationships with suppliers, customers and others. |
The Director notes that achieving our strategy depends on strong mutually beneficial relationships with suppliers, customers and others. The company actively seeks these mutually beneficial arrangements when entering into any new relationships. The company also accepts feedback from current relationships and actively promotes the process of improving these relationships. |
S172(1)(D) |
The impact of the company's operations on the community and the environment |
The Company believes that this is extremely important and relevant with the industry that the Company operates. The company has been committed to becoming a world-class natural uranium trader with the mission of "Providing Safe, Affordable and Reliable Products for international uranium market" since establishment. The company's approach is structured around focus areas through regularly engaging with a broad range of stakeholders including clients, suppliers, investors, analysts, governments, and the wider community. |
S172(1)(E) |
The desirability of the company maintaining a reputation for high standards of business conduct |
The Company's culture drives that way we do business, and our expectations of our staff including code of practice are outlined in the employee's handbook. The company periodically reviews and approves the codes of practice in place in the Company to ensure that its high standards are maintained both within the Company and the business relationships we maintain. |
S172(1)(F) The need to act fairly as between members of the company. |
The delivery of sustainable long-term value requires the allocation of capital and resources in a way that identifies and addresses stakeholders' needs fairly. After weighing up all factors surrounding the decision and by taking into account the Company's overall vision and goals, the Company aims to make sure that the decisions it makes are dependable and predictable and are most likely to benefit the Company as a whole. |
ON BEHALF OF THE BOARD: |
CGN Global Uranium Limited (Registered number: 09142456) |
Strategic Report |
for the Year Ended 31 December 2023 |
CGN Global Uranium Limited (Registered number: 09142456) |
Report of the Director |
for the Year Ended 31 December 2023 |
The director presents his report with the financial statements of the company for the year ended 31 December 2023. |
The profit for the year after taxation, amounted to $6,920,000 (2022: $7,659,000). |
There were no donations in the current year nor prior year. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of sales and trading of uranium. |
DIVIDENDS |
No dividends (2022: Nil) will be distributed for the year ended 31 December 2023. |
FUTURE DEVELOPMENTS |
The director is constantly reviewing the strategic options available in investment and trading of uranium resources. As the uranium trading and exclusive agent of Husab mine in international market, the company will continue to expand its customer base within the industry with a view to increasing growth in all areas of its business. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTOR |
FINANCIAL INSTRUMENTS |
The company's financial instruments are comprised of cash that generates directly from its operations and loans. The main purpose of these financial instruments is to raise finance for the company's operations. |
The main risks arising from the company's financial instruments are uranium market price risk, interest rate risk, foreign currency risk and liquidity risk. The board reviews and agrees policies for managing each of these risks and they are summarised below. The policies will be reviewed each year and updated in compliance with corporate governance policies. |
Market risk |
Majority of uranium material inventory is sold under contracts with the uranium prices locked in, so the market price relationship is irrelevant to the locked contracts. The directors' opinion is that the market risk does not currently present a significant risk to the company under current market conditions. This is discussed in the Strategic report. |
Interest rate risk |
The company finances its operations through a mixture of retained profits and loans from group and external undertakings. The borrowing facilities with low-margined interest rates and the cost had been covered by locked prices so interest rate risks are not considered to be significant. |
Foreign currency risk |
The company holds bank accounts and receives overhead invoices in different currencies and so is subject to some exchange rate gains and losses. The overall proportion of currency commitments is relatively small, hence the foreign currency risk faced by the company is relatively low. |
Liquidity risk |
The company holds bank accounts and has sufficient loan facilities from group and external lenders to cover its operation demand. |
CGN Global Uranium Limited (Registered number: 09142456) |
Report of the Director |
for the Year Ended 31 December 2023 |
ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS |
Delivering our strategy requires strong mutually beneficial relationships with suppliers, customers, governments and other stakeholders. The Company seeks the promotion and application of certain general principles in such relationships. The ability to promote these principles effectively is an important factor in the decision to enter into or remain in such relationships. The Board also reviews and approves the Company's approach to suppliers which is set out in the Company Supplier Principles. Management continuously assesses the priorities related to customers and those with whom we do business, and the Board engages with the businesses on these topics, for example, within the context of business strategy updates and investment proposals. |
Moreover, the Director receives information updates on a variety of topics that indicate and inform how these stakeholders have been engaged. The Company also works with other stakeholders such as regulatory and environmental bodies. |
STREAMLINED ENERGY AND CARBON REPORTING |
The Company is in scope for Streamlined Energy and Carbon Reporting (SECR) and also qualifies for ESOS. However, the Company falls under the category of a low energy user whose Total Energy Consumption (TEC) is at a domestic level of 40,000 kWh/year or less. Therefore, the Company is exempt from producing a fully compliant energy audit or achieving an alternative route to compliance. In practice, the Company promotes measures such as reducing waste and recycling, using LED lighting, encouraging use of public transport/cycling to reduce carbon footprints. |
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 company'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 company's auditors are aware of that information. |
AUDITORS |
The auditors, Shinewing Wilson Accountancy Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
CGN Global Uranium Limited (Registered number: 09142456) |
Statement of Director's Responsibilities |
for the Year Ended 31 December 2023 |
The director is responsible for preparing the 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 of the profit or loss of the company 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 transactions and disclose with reasonable accuracy at any time the financial position of the company 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
Report of the Independent Auditors to the Members of |
CGN Global Uranium Limited |
Opinion |
We have audited the financial statements of CGN Global Uranium Limited (the 'company') for the year ended 31 December 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity and 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 company's affairs as at 31 December 2023 and of its profit 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 company 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 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 Strategic Report, the Report of the Director and the Statement of Director's Responsibilities, 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. |
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 Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
CGN Global Uranium Limited |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the 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 eight, 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 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 company or to cease operations, or has no realistic alternative but to do so. |
Report of the Independent Auditors to the Members of |
CGN Global Uranium Limited |
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: |
Discussions were held with, and enquiries made of, management and those charged with governance with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity. |
The following laws and regulations were identified as being of significance to the entity: |
- Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax and Pensions legislation, distributable profits legislation. |
- There are no laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements. |
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; review of board minutes; testing the appropriateness of entries in the nominal ledger, including journal entries; reviewing transactions around the end of the reporting period; and the performance of analytical procedures to identify unexpected movements in account balances which may be indicative of fraud. |
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity's controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK). |
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. |
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 Certified Accountants |
and Statutory Auditors |
9 St Clare Street |
London |
EC3N 1LQ |
CGN Global Uranium Limited (Registered number: 09142456) |
Statement of Comprehensive Income |
for the Year Ended 31 December 2023 |
31.12.23 | 31.12.22 |
Notes | $'000 | $'000 | $'000 | $'000 |
TURNOVER | 4 |
Cost of sales |
GROSS PROFIT |
Distribution costs |
Administrative expenses |
3,157 | 2,481 |
OPERATING PROFIT | 6 |
Interest receivable and similar income |
15,799 | 11,583 |
Interest payable and similar expenses | 7 |
PROFIT BEFORE TAXATION |
Tax on profit | 8 | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
CGN Global Uranium Limited (Registered number: 09142456) |
Balance Sheet |
31 December 2023 |
31.12.23 | 31.12.22 |
Notes | $'000 | $'000 | $'000 | $'000 |
FIXED ASSETS |
Tangible assets | 9 |
CURRENT ASSETS |
Stocks | 10 |
Debtors | 11 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 12 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 14 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 15 |
Retained earnings |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the director and authorised for issue on |
CGN Global Uranium Limited (Registered number: 09142456) |
Statement of Changes in Equity |
for the Year Ended 31 December 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
$'000 | $'000 | $'000 |
Balance at 1 January 2022 |
Changes in equity |
Issue of share capital | - |
Total comprehensive income | - |
Balance at 31 December 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 December 2023 |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements |
for the Year Ended 31 December 2023 |
1. | STATUTORY INFORMATION |
CGN Global Uranium Limited is a |
The company's functional and presentation currency is US$. |
Monetary amounts included in these financial statements are rounded to the nearest thousand $. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
The director has prepared the financial statements on a going concern basis which assumes that the company will continue in operational existence for the foreseeable future. The director has reviewed the cash flow forecasts for a period of not less than 12 months from the date of the approval of these financial statements. Based on the cash flow forecasts and analysis, the company has sufficient headroom on its credit facilities in place to fund the working capital requirements in the going concern period and have therefore concluded that it is appropriate to prepare these financial statements on a going concern basis. The director has also considered the Company's ability to renew the credit facilities that are due to expire within the going concern period and have a reasonable expectation that a renewal will be forthcoming based on their success of renewals in the past. The company also mitigates the risk of non-renewal of credit facilities by holding facilities with multiple facility providers. |
Reclassification of comparative figures |
Other income recognised in the company's income statements for the financial year ended 31 December 2022 has been reclassified to financial income in accordance with the change in accounting policy to conform with current year presentation. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirement of paragraph 33.7. |
The Company's parent undertaking, CGN Mining Company Limited includes the Company in its consolidated financial statements. The consolidated financial statements of CGN Mining Company Limited which listed on Hong Kong stock exchange (1164.HK) are prepared in accordance with Hong Kong Financial Reporting Standards (HKFRS) and are available to the public and may be obtained from http://www.cgnmc.com/en_cgnmc/index.shtml. |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: |
Sale of goods |
The company's revenue is from the sales of uranium and revenue is recognised at a point in time, when the customer obtains control of the asset which is upon delivery or book transfer. |
Revenue from the sale of goods is recognised when all of the following conditions are satisfied: |
- the Company has transferred the significant risks and rewards of ownership to the buyer; |
- the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; |
- the amount of revenue can be measured reliably; |
- it is probable that the Company will receive the consideration due under the transaction; and |
- the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Tangible fixed assets |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
The Company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred. |
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight line method. The estimated useful lives range as follows: The estimated useful lives range as follows: |
Fixtures & fittings 5 years |
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. |
Stocks |
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average cost method basis. |
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss. |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments' of FRS 102 to all of its financial instruments. |
Financial instruments are recognised when the company becomes party to the contractual provisions of the instrument. |
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously. |
Basic financial assets |
Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the financial asset is measured at the present value of the future receipts discounted at a market rate of interest. |
Classification of financial liabilities |
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. |
Basic financial liabilities |
Basic financial liabilities, including trade and other payables, bank loan and loans from group undertakings, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. |
Debt instruments are subsequently carried at amortised cost, using the effective interest method. |
Share capital |
Financial instruments issued by the company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. |
The company's ordinary shares are classified as equity instruments. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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. |
Deferred tax |
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. |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into US dollar at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into US dollar at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Operating leases: lessee |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Finance cost |
Finance costs are charged to the Income statement over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument. |
Finance income |
The Company earns finance income from Sales and repurchase back transactions where the Company sells the Uranium to a customer and then repurchases it back for an amount that is less than the original selling price of the asset after an agreed date. The entity recognises as financial transaction and finance income recognised using straight-line method to spread over the whole term. |
3. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
In applying the company's accounting policies, the director is required to make judgements, estimates and assumptions in determining the carrying amount of the assets and liabilities. The director's judgements, estimates and assumptions are based on the best and most reliable evidence at the time when the decisions are made, and based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results and outcomes may differ. |
The estimates and underlying assumptions are reviewed on an ongoing basis. Revision to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects both current and future periods. |
The critical accounting judgements that the director has made in the process of applying the company's accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below. |
Critical judgements in applying the company's accounting policies |
Slow and obsolete stock provisions are reviewed on a line by line basis and appropriate provisions are recorded as necessary. |
Impairment testing is carried out for all tangible assets at the year end date or where there is an indication that impairment exists. For the purposes of impairment testing, the carrying amounts of the tangible assets are reviewed and an impairment loss is recognised where the carrying amounts exceed the assets recoverable amount. |
Key sources of estimation uncertainty |
There are no key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
4. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by class of business is given below: |
31.12.23 | 31.12.22 |
$'000 | $'000 |
An analysis of turnover by geographical market is given below: |
31.12.23 | 31.12.22 |
$'000 | $'000 |
United Kingdom |
Europe |
United States of America |
Switzerland | 232,225 | 81,353 |
Canada | 26,545 | 75,314 |
Rest of world | 86,470 | - |
5. | EMPLOYEES AND DIRECTORS |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
31.12.23 | 31.12.22 |
Sales | 3 | 3 |
Administration | 3 | 3 |
31.12.23 | 31.12.22 |
$ | $ |
Director's remuneration |
Director's pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
5. | EMPLOYEES AND DIRECTORS - continued |
Information regarding the highest paid director is as follows: |
31.12.23 | 31.12.22 |
$ | $ |
Emoluments etc |
Pension contributions to money purchase schemes |
6. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Other operating leases |
Depreciation - owned assets |
Auditors' remuneration |
Other non- audit services |
Foreign exchange differences | ( |
) |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Bank interest |
Interest paid to group |
8. | TAXATION |
Analysis of the tax (credit)/charge |
The tax (credit)/charge on the profit for the year was as follows: |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Current tax: |
UK corporation tax | ( |
) |
Tax on profit | ( |
) |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
8. | TAXATION - continued |
Reconciliation of total tax (credit)/charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Income not taxable for tax purposes | ( |
) |
Depreciation in excess of capital allowances | - |
Adjustments to tax charge in respect of previous periods |
Tax rate changes | (1,663 | ) | 3 |
Other | 19 | - |
Total tax (credit)/charge | (8 | ) | 1,825 |
In 2021 an increase in the corporation tax rate to 25% with effect from 1 April 2023 was substantively enacted. The 23.5% rate used above reflects 9 months of this new rate and 3 months of the previous rate of 19%. The 25% rate is used to measure UK deferred taxes in 2023 (and in 2022 to the extent the related timing differences were expected to reverse after 1 April 2023). |
The company is within the scope of the OECD Pillar Two model rules. Pillar Two legislation was enacted in England the jurisdiction in which the entity is incorporated and will come into effect from 1 January 2025. Since the Pillar Two legislation was not effective at the reporting date, the entity has no related current tax exposure. The entity applies the exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to Section 29 issued in July 2023. |
9. | TANGIBLE FIXED ASSETS |
Fixtures |
and |
fittings |
$'000 |
COST |
At 1 January 2023 |
Additions |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
10. | STOCKS |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Stocks |
Stocks to the value of $713,233,000 were recognised as expenses in the year (2022: $285,728,000). |
11. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Trade debtors |
Other debtors - Rent deposit |
Tax |
VAT |
Prepayments and accrued income |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Other loans (see note 13) |
Amounts owed to group undertakings |
Tax |
Other creditors |
Accrued expenses |
Included in other creditors, an amount of $68,880,000 (2022: $45,795,000) represent repurchase agreements relate to inventory which has been sold on terms under which the company is committed to repurchase at a future date within 12 months. |
13. | LOANS |
An analysis of the maturity of loans is given below: |
31.12.23 | 31.12.22 |
$'000 | $'000 |
Amounts falling due within one year or on demand: |
Other loans |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
13. | LOANS - continued |
Bank of China - London |
During the year the existing credit and trade finance facility with Bank of China - London ("BOCL") . has been extended. On 6 July 2023, the Company signed an amendment guaranteed revolving credit and trade finance facility of $150 million with BOCL. As at 31 December 2023 the total amount outstanding including accrued interest charges was $45 million (2022: $73.6 million) which was due for repayment in January and March 2024 and attracts interest rate up to 6.02072% p.a. (2022: up to 5.12063%). Under the terms of the facility, the loan is guaranteed by the parent company, CGN Mining Company Limited. |
Bank of China - Hong Kong |
During the year the existing revolving facility loan of $50 million with Bank of China - Hong Kong expired. During the year, the Company repaid all loan balance. There is no outstanding balance as at 31 December 2023 (2022:$50.7 million). |
China Construction Bank (Asia) |
The Company has an existing revolving facility loan of $100 million with China Construction Bank (Asia). During the year, the Company drew down and repaid $154.5 million under the facility. There is no outstanding balance as at 31 December 2023. Under the terms of the facility, the loan is guaranteed by the parent company, CGN Mining Company Limited. |
CGN Mining Company Limited |
During the year the existing revolving facility loan of $150 million with its Parent Company, CGN Mining Company Limited expired. During the year the company drew down $42million and repaid $21million. As at 31 December 2023, there is no outstanding balance (2022: $21 million), the loan interest paid during the year is $824,000 (2022: $323,000). |
14. | PROVISIONS FOR LIABILITIES |
31.12.23 | 31.12.22 |
Deferred tax | $ | $ |
Accelerated capital allowance | 36 | 36 |
Tax expenses included in profit or loss |
31.12.23 | 31.12.22 |
$ | $ |
Origination of timing difference | - | 36 |
15. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31.12.23 | 31.12.22 |
value: | $'000 | $'000 |
ordinary shares | $1 | 11,000 | 11,000 |
On 11 April 2022, the Company issued 8 million new ordinary shares with a nominal value of $1 at par value to the parent company, CGN Mining Company Limited. |
16. | ULTIMATE PARENT COMPANY |
The company's parent is CGN Mining Company Limited, a company incorporated in Cayman Island, listed on the Hong Kong stock exchange and in turn is a 56.29% owned subsidiary of China Uranium Development Company Limited. China General Nuclear Power Corporation is the ultimate parent of the Company and controlling entity. The financial statements of CGN Mining Company Limited are available to the public (http://www.cgnmc.com/en_cgnmc/index.shtml). |
CGN Global Uranium Limited (Registered number: 09142456) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
17. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
For transactions with related parties not within the group are shown as follows: |
Swakop Uranium (Pty) Ltd | 2023 | 2022 |
Fellow company share the same ultimate parent entity | $ | $ |
Related party transactions during the year are in relation to purchase of |
330K lbs (2022: 180K lbs) uranium | 17,053 | 9,126 |
Balance outstanding and included in creditors | - | - |
Huasheng Investment Limited |
Fellow company share the same ultimate parent entity |
Interest payable on loan amount as at the year end | - | 251 |
Interest receivable on the money held by Huasheng | 113 | 562 |
Money held by Huasheng at the year end | 55,745 | 1,327 |
CGNPC Uranium Resources Co., Ltd |
Ultimate parent entity |
Related party transactions during the year are in relation to expatriates' expenses paid on behalf of the company |
203 |
196 |
Balance outstanding and included in creditors | 242 | 39 |
18. | POST BALANCE SHEET EVENTS |
In January 2024, the Company signed a new facility agreement with Ping An Bank Co., Ltd. for US$100 million of which 50% is guaranteed by its parent company, CGN Mining Company Limited and remaining 50% is under credit line without guarantee. |