This past week, as well as drilling down into the ground at the KCB, we’ve been drilling down into the company too.
Both present their own challenges…
But both help our progress enormously.
Indeed, as our drill campaign continues apace, and we continue to progress our projects at the KSZ and Ditau, we’ve been engaged in a serious undertaking to provide the FCA with a full company prospectus.
It’s been a lot of work for our management team, but I think will prove to be worth it.
The FCA, as you no doubt know, is the Financial Conduct Authority.
As part of their regulatory oversight, when a company like ours on the Standard List raises funds, the FCA requires us to produce and submit a detailed prospectus that outlines how the company has developed so far and how funds will be used in the future.
We have to provide evidence on how we plan to achieve our strategic goals, and - importantly – the basis on which we’ve made our future predictions (or “forward looking statements”).
Granted, talking about the FCA hardly sounds like an exciting or stimulating subject for an email like this...
But the truth is, compiling a detailed report of this nature provides several encouraging benefits, as I’ll explain.
Of course, those familiar with how the markets work might be aware that most companies in the UK exploration space, who are listed on AIM, do not have to produce a prospectus like this. AIM is a market to which these rules do not apply, but we are on the Standard List of the main LSE – a more prestigious venue for a company like ours to trade.
One of the main benefits of spending so much time on preparing a prospectus is that it has given us the chance to complete a comprehensive review of the entire company. We've been able to see what we’ve done well and also see where we might be able to do things differently in future.
That kind of self-awareness and insight could prove to be invaluable as we move forward.
There’s also the fact that the process of approving the prospectus means two separate individuals from the FCA are required to go through everything themselves with a fine-toothed comb and ask questions about anything that sticks out as odd or needs better explaining.
Though some might see this as unwelcome scrutiny, I encourage it wholeheartedly.
It helps confirm we’re doing things right from a regulatory perspective. This makes our business stronger and more robust.
More so, the regulator is particularly concerned with our forward-looking statements.
This is key.
This isn’t just about checking what’s gone before…
It’s about ensuring, at least from a regulatory perspective, that we have planned strategically and financially in a way that makes sense…that the sums add up.
It’s further reassurance for Kavango, but also for investors and the market as a whole.
Indeed, that’s another knock-on benefit of compiling such a detailed review and having it approved by the FCA… it means we have more compelling evidence for future investors that what we’re doing is investible. They’ll be able to consult this document and use it to support their investment case.
Yes - it’s been a lot of work, and not the exciting work of drilling and getting our hands in the Botswanan soil…
And yes, many similar companies listed on AIM avoid the need to do this altogether...
But the whole process, though detailed and demanding, has left me feeling even more positive about what we’re doing here at Kavango.
It fills me with greater confidence. And I hope, now that the process is complete and the prospectus is published on our website, it will give a boon to investors too.
The takeaway is simple…
Both below the ground and behind the scenes, our work is progressing with clear focus and steely determination.
Now that the prospectus is published, we can complete various elements of our work programmes and I look forward to bringing you more news in the near future.