REG - Anglo Asian Mining - Interim Results
25/09/2025 07:00
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RNS Number : 7278A Anglo Asian Mining PLC 25 September 2025
25 September 2025
Anglo Asian Mining PLC
Interim results for the six months to 30 June 2025
Return to profitability and key strategic progress, with two new mines
entering production during the year
Anglo Asian Mining PLC ("Anglo Asian", the "Company" or the "Group"), the
AIM-listed (ticker: AAZ) copper, gold, and silver producer in Azerbaijan, is
pleased to announce its unaudited interim results for the six-months ended 30
June 2025 ("H1 2025" or the "Period").
Financial highlights
· Total revenues of $40.9 million (H1 2024: $13.4 million)
o Attributable to all processing facilities operating continuously
throughout the Period which yielded higher production volumes and strong
commodity prices
o Higher gold bullion sales of 9,781 ounces (H1 2024: 6,000 ounces) sold at
a higher average gold price of $3,077 per ounce (H1 2024: $2,174 per ounce)
o Copper concentrate sales rose to $10.4 million (H1 2024: $0.5 million)
reflecting the increasing proportion of copper within the Group's production
· A return to profitability with profit before taxation of $7.1 million
(H1 2024: loss of $5.5 million)
o Gross profit of $13.8 million (H1 2024: gross loss of $1.7 million) due to
higher revenues
o Higher finance costs at $1.7 million (H1 2024: $1.2 million) due to higher
borrowing costs
· Cash generative with net cash generated by operating activities of
$11.4 million (H1 2024: $3.2 million)
· Investments in our future growth continued during the Period
o $8.0 million of capital expenditure predominately on mine and processing
plant development (H1 2024: $6.3 million)
· Net debt position (excluding leases but including advance from
Trafigura) reduced to $13.1 million at 30 June 2025 (31 December 2024: $14.7
million)
· No interim dividend declared for 2025
Operational highlights
· Total production of 16,378 Gold Equivalent Ounces ("GEOs") (H1 2024:
5,270 GEOs) due to continuous production since the start of January and
additional production from Gilar ramping up since May
o Gold production of 12,115 ounces (H1 2024: 4,704 ounces)
o Copper production of 1,188 tonnes (H1 2024: 100 tonnes)
o Silver production of 62,354 ounces (H1 2024: 12,746 ounces)
· New Gilar underground mine enters production
o 106,510 tonnes of ore produced grading 0.99 per cent. copper and 1.23 grams
per tonne of gold in H1 2025
· Encouraging progress made at Xarxar and Garadag with both projects
in-line with expectations and on track to commence production in 2027/28 and
2029, respectively
Outlook
· Post Period-end, the new Demirli mine entered production in July 2025
o Demirli is a significant copper asset and critical to executing Anglo
Asian's transition to a mid-tier producer of mostly copper
o Approximately 4,000 tonnes of copper in concentrate expected to be produced
in 2025 followed by a ramp-up during 2026
o Lease entered into with AzerGold Closed Joint Stock Company for the use of
the Demirli flotation plant
§ Rent will be included in operating costs for calculation of the Demirli
production share and be deductible for tax, which will significantly reduce
the impact on the earnings and cash flow of the Group
· Revised full year 2025 production guidance will be issued later in
the year after final evaluation of the following:
o Full year 2025 production at Demirli
o Effect of higher copper grades from Gilar which has required an upgrade to
the flotation plant which has commenced and is expected to be completed before
the end of the year
Anglo Asian CEO Reza Vaziri commented:
"I am delighted to announce our interim results for 2025 and a return to
profitability. In line with our growth strategy, during 2025 so far, we have
started production at two new mines, Gilar and Demirli. These are important
milestones in the execution of our growth strategy and in Anglo Asian's
history, as we transition to a mid-tier producer with copper as our dominant
product. The team continues to make strong progress across our portfolio, and
we remain committed to delivering value for our shareholders."
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed
inside information for the purposes of Article 7 of Regulation (EU) No
596/2014, which was incorporated into UK law by the European Union
(Withdrawal) Act 2018, until the release of this announcement.
For further information please contact:
Anglo Asian Mining plc
Reza Vaziri, Chief Executive Officer Tel: +994 12 596 3350
Bill Morgan, Chief Financial Officer Tel: +994 502 910 400
Stephen Westhead, Vice President Tel: +994 502 916 894
Amir Vaziri, Chief Business Development Officer Tel: +1 (301) 332 9938
SP Angel Corporate Finance LLP (Nominated Adviser and Broker) Tel: +44 (0) 20 3470 0470
Ewan Leggat
Adam Cowl
Hudson Sandler (Financial PR) aaz@hudsonsandler.com (mailto:aaz@hudsonsandler.com)
Charlie Jack Tel: +44 (0) 20 7796 4133
Harry Griffiths
Kristina Gaysina
Notes to editors
Anglo Asian Mining plc (AIM:AAZ) is a gold, copper and silver producer with a
high-quality portfolio of production and exploration assets in Azerbaijan. The
Company produced 16,760 gold equivalent ounces ("GEOs") for the year ended 31
December 2024. In the six months to 30 June 2025, the Company produced 16,378
GEOs.
The Company's strategic plan for growth shows a clearly defined path for the
Company to transition to a multi-asset, mid-tier, copper and gold producer by
2030, by which time copper will be the principal product of the Company, with
forecast annual production of around 50,000 to 55,000 tonnes of copper. It
plans to achieve this growth by bringing into production three new mines
during the period 2027 to 2030 at Xarxar, Garadag and Zafar, in addition to
the newly opened Gilar and Demirli mines. Production commenced at the Gilar
mine in May 2025 and Demirli in July 2025. https://www.angloasianmining.com/
(https://www.angloasianmining.com/)
Chairman's statement
Dear Shareholders
The six months to 30 June 2025 was a significant turning point in the Group's
development. Anglo Asian has emerged from a very challenging time and started
delivering tangible progress against its growth strategy. We are now seeing
the rewards of Anglo Asian's resilience, with a very strong start to 2025.
Gilar and Demirli started production in May and July respectively and the
Group has returned to profitability.
In May, we successfully commenced production at Gilar, our new underground
copper mine. Gilar is situated within the Gedabek contract area, and benefits
from our existing infrastructure and processing facilities. The JORC mineral
resources estimate confirmed the Gilar deposit contains nearly 54,000 tonnes
of copper and over 255,000 ounces of gold. Gilar is an important mine in
growing our portfolio of copper producing assets. It is expected to achieve
monthly production of 50,000 to 60,000 tonnes of ore following a steady
ramp-up.
We were delighted to start production at Demirli in July, with forecast
production of approximately 4,000 tonnes of copper during 2025. The Demirli
contract area was acquired in 2022, and we gained access to the site in the
summer of 2024. Since then, we have completed the required refurbishment and
ancillary works necessary to commence production. From 2026 onwards, output is
expected to increase to approximately 15,000 tonnes of copper per annum,
providing a substantial addition to our production. The life of mine is
currently being determined as the geological and mineral resource model is
being completed. However, we are confident that Demirli is a significant asset
for Anglo Asian's future growth.
To recognise the role played by the Government of Azerbaijan (the
"Government"), in bringing Demirli into the Group's portfolio of assets, the
Group entered into a lease during the Period for the use of the Demirli
flotation plant with AzerGold Closed Joint Stock Company. The Government is
currently completing the registration of all plant and equipment and issuing
formal approval for the use of the tailings dam. The lease will
commence when this exercise is completed, which is expected by the end of
the year. However, the Government has agreed the Group can undertake test
processing and commissioning of the flotation plant whilst this exercise is
carried out. The Group will not pay for the use of the flotation plant during
the test period, but cannot sell concentrate produced while testing, until the
lease commences.
Bringing two very different mines and a flotation plant into production in the
same year is an extraordinary achievement. The successful start-up of these
mines demonstrates the deep expertise and professionalism of our team and the
exciting development prospects of our portfolio. We are also delighted to have
brought these mines into production without raising equity capital or diluting
shareholders.
Production
Production improved significantly since the disruption of last year. The
Company produced 16,378 gold equivalent ounces ("GEOs") in H1 2025, compared
with 5,270 GEOs in H1 2024. This comprised 1,188 tonnes of copper production
(H1 2024: 100 tonnes), 12,115 ounces of gold (H1 2024: 4,704 ounces), and
62,354 ounces of silver (H1 2024: 12,746 ounces).
We are particularly encouraged by the first production from Gilar with its
higher-than-expected grades. Unfortunately, these higher-than-expected grades
have caused clogging of the thickener circuit and filter press. This will
slightly reduce our planned output in the short term, as only lower and medium
grade ore is currently being processed. Higher grade ore is being stockpiled
for use once the flotation plant upgrade is completed. The ongoing upgrades to
the flotation plant will be completed before the end of the year and position
the mine well for the future.
Strategic growth plan
We have made significant progress in delivering our medium-term growth
strategy. Gilar has entered production and is contributing meaningfully to
Group production, while commissioning continues to ramp up production at
Demirli.
Gilar is a significant milestone for Anglo Asian Mining, as it is the first
new mine the Company has opened since the Gedabek underground mine in 2020.
Alongside Demirli, it will ensure the Company maintains a portfolio with
considerable future potential. These new mines will more than replace the
declining output from our older mines, many of which are now approaching the
end of their lives.
Longer term, we are focusing on developing Xarxar and Garadag, which will
enable us to deliver our medium term target of becoming a mid-tier producer of
mainly copper. We continue our evaluation of these deposits and significant
progress was made in H1 2025.
Sustainability
The publication of Anglo Asian's inaugural sustainability rating,
independently assessed and provided by Digbee Ltd., demonstrates the ongoing
importance of the Company's sustainability commitments and programmes.
A panel of globally recognised sustainability professionals, following a
detailed review, awarded Anglo Asian's overall corporate-level sustainability
performance a 'BB' rating, and also a site-level rating for the Gedabek
operations of 'BB'. The ratings recognise our strong performance across a
range of factors, including our sustainability risk management, but also
demonstrate where further progress is needed. Improving the sustainability of
our operations is central to our strategy, and we are actively addressing
areas for improvement.
Annual General Meeting for 2025 ("AGM")
Our AGM was held on 25 June 2025, and we were very pleased with attendance
which demonstrates the continuing strong support and trust displayed by our
shareholders. A detailed presentation about the Company was made following the
formal business of the AGM, which we believe was well received.
Rectification of technical issues regarding distributable reserves
A circular containing full details of the issues with distributable reserves
will be posted to shareholders on 29 September 2025. A General Meeting of the
Company will be held on 22 October 2025 at which a resolution will be put to
shareholders to rectify the issues. Details of the General Meeting are
contained in the circular and all shareholders are welcome to attend.
Outlook
This is an exciting time for your Company. We have made a strong start to the
year, opening two new mines and returning the Company to profitability. We
plan to continue this progress throughout the rest of the year and into 2026
and beyond. We believe the Company can build on this progress to substantially
develop and grow the Company to create considerable shareholder value.
Appreciation
I would like to extend my gratitude to all Anglo Asian employees, whose hard
work and expertise made the commissioning of our two new mines this year
possible. I would also like to thank our many partners and the Government of
Azerbaijan for their ongoing support of Anglo Asian. I look forward to
providing an update on our continued progress later in the year.
Khosrow Zamani
Non-executive chairman
24 September 2025
Chief Executive Officer's review
I am pleased to report a strong performance for the six months to 30 June
2025. We commenced production at our new Gilar mine and post Period end at
Demirli in July 2025. Starting production from these two mines is a big
milestone in executing our medium-term growth strategy to become a mid-tier
producer.
Two new mines entering production
Production commenced at Gilar in May, and the mine produced 106,510 tonnes of
ore at grades of 1.23 grammes of gold per tonne and 0.99 per cent. copper in
the Period. While copper production fell short of that expected, this was due
to higher-than-expected grades from Gilar which require an upgrade of the
thickener circuit and filter press. We expect the upgrade to be completed
before the end of the year. Following the ramp-up of operations, we anticipate
Gilar will reach a monthly production of 50,000 to 60,000 tonnes of ore.
Gilar is located just seven kilometres from the Company's processing
facilities and therefore benefits significantly from existing Gedabek site
infrastructure. A maiden JORC mineral resources estimate confirmed the Gilar
deposit contains 6.10 million tonnes of mineralisation with average grades of
0.88 per cent. for copper, totalling nearly 54,000 tonnes of copper, and 1.30
grammes of gold per tonne, containing over 255,000 ounces of gold.
Demirli began production in July and commissioning is progressing well. I
would like to thank all our employees and partners for their support and hard
work in achieving this important milestone. Demirli is an exciting new asset
for Anglo Asian, which was acquired in 2022, with access to the site granted
in the Summer of 2024. It is located in the Karabakh Economic Region with ore
mined from a large open pit and processed via an adjacent flotation plant.
Since gaining access, we have fully evaluated the property, connected water
and power supplies, refurbished its control systems and tested its key
equipment. We have also assessed its existing tailings dam and have identified
a site for a second tailings dam, which we aim to make operational in 2026.
The Group has entered into a lease with AzerGold Closed Joint Stock Company
for the use of the Demirli flotation plant. The lease will commence upon the
completion of the registration of all plant and equipment and approval of the
use of the tailings dam, which is expected by the end of the year. Until the
lease commences, the Group is using the flotation plant without payment, but
the concentrate produced cannot be sold until the lease commences. The lease
is for three years and can be extended, and the Group can give 12 months'
notice at any time. The annual base rent is $24 million per annum ($2 million
per month). The base rent will be reduced, if in any calendar year, 75 per
cent. of the revenue from the flotation plant less operating and capital
expenses (the "Minimum Rent") is less than $24 million. The Minimum Rent will
be paid for that calendar year subject an overall lower limit of a Minimum
Rent payment of $15 million per annum. If 15 per cent. of revenue in any year
exceeds $28 million, the rent will be increased to 15 per cent. of revenue
less $4 million. This is provided 75 per cent. of revenue less operating and
capital expenses is greater than $28 million. The Group's usual production
sharing arrangements will apply to Demirli. The rent will be included in the
Demirli recoverable costs in accordance with the production sharing agreement
and will be deductible for tax. This will significantly reduce the impact of
the rent on the earnings and cash flow of the Group
We forecast Demirli to produce approximately 4,000 tonnes of copper in
concentrate during 2025 and, from 2026 onwards, this is expected to increase
to approximately 15,000 tonnes of copper per annum. The life-of-mine will be
determined following the completion of the geological and mineral resource
model. We are confident Demirli is a substantial asset that meaningfully
enhances our growth prospects. We are also very pleased with the support of
Trafigura Pte Ltd. who have entered into a prepayment agreement to purchase
the Demirli copper concentrate.
There is significant potential for additional mineral resources at Demirli,
with known extensions to the current pit area and nearby copper targets
identified for future evaluation. A regional exploration programme will be
undertaken. Importantly, Anglo Asian remains a first mover in the mining
industry in Azerbaijan and continues to support the Government in developing
and growing its extractive sector. Demirli will play a central role in the
renaissance of the Karabakh Economic Region.
Operational review
Total production for the Period was 16,378 gold equivalent ounces ("GEOs"),
compared to 5,270 GEOs during the same period last year ("H1 2024"). Copper
production totalled 1,188 tonnes, compared with 100 tonnes in H1 2024, while
gold production totalled 12,115 ounces, compared with 4,704 ounces in H1 2024.
Silver production was 62,354 ounces, compared with 12,746 ounces in H1 2024.
The first quarter of the year was Anglo Asian's first continuous quarter of
full production since production was partially suspended. The quarter was a
significant milestone as our comprehensive preparations for the restart of
operations in late 2024 enabled us to quickly increase our production. We
continued this momentum into the second quarter with a further increase in
production. The addition of Gilar and Demirli will further boost our output in
the second half of the year.
During the Period, we also strengthened our Senior Management team with a
number of high caliber appointments. We have appointed a new Director of
Mining, a Geology Director and a Senior Mining Engineer. These are all highly
experienced professionals who will provide valuable support and guidance as we
deliver on our ambitious growth programme.
Future mine development
Further progress is underway across our portfolio of assets under development.
At Xarxar, which borders Gedabek to the north and benefits from shared
infrastructure and staffing, preparatory mine design and process selection is
already underway, with first production targeted for 2027/2028. A maiden JORC
mineral resource estimate shows the deposit contains a total in-situ resource
of 119,100 tonnes of copper. Early studies include geological modelling, mine
scheduling and land allocation for future infrastructure. In addition, the
Xarxar Contract Area shows strong exploration potential with opportunities for
further copper discoveries near the existing deposit. Bringing Xarxar into
production is the next important milestone in our growth strategy. It will add
considerable copper production to our portfolio and deliver real value to the
Company and our shareholders.
Two mine design studies have already been carried out for Garadag, outlining
different production scenarios, ranging from nine to eighteen years. Its
maiden JORC mineral resource estimate shows the deposit has a total in-situ
copper resource of 897,000 tonnes of copper. Work is now focused on confirming
the best approach to development through additional drilling, mine design
optimisation and assessment of processing technologies.
These deposits take the Group's total JORC mineral resource to more than one
million tonnes of copper, establishing a robust pipeline that will support
Anglo Asian's transformation into a copper-focused, mid-tier producer.
Financial review
With all of our processing facilities operating continuously during the
Period, we were pleased to deliver revenue of $40.9 million compared to $13.4
million in the six months to 30 June 2024 ("H1 2024"). Revenues for H1 2025
included gold bullion sales of 9,781 ounces at a higher average price of
$3,077 per ounce (H1 2024: 6,000 ounces sold at an average price of $2,174 per
ounce) and total copper concentrate sales of $10.4 million (H1 2024: $0.5
million).
The strong revenue performance and the continued careful management of costs
delivered profit before taxation of $7.1 million, compared with a loss of $5.5
million in H1 2024. Gross profit during the Period was $13.8 million (H1 2024:
$3.2 million), and our finance costs rose to $1.7 million as a result of
higher borrowing costs.
Our cash generation was strong, with net cash generated by operating
activities of $11.4 million (H1 2024: $3.2 million). This enabled us to
continue to invest in our future growth, with capital expenditure of $8.0
million in the Period, mostly for mine and plant development.
Net debt reduced to $13.1 million as at 30 June 2025 (31 December 2024: $14.7
million). Our saleable inventory at 30 June 2025 was 1,176 ounces of gold with
a market value of approximately $2.1 million.
Environmental, Social and Governance ("ESG") review
During the Period, we were pleased to receive the results of our inaugural ESG
rating from Digbee Ltd.
The ESG assessment involved a detailed review of Anglo Asian's corporate
activities and the Gedabek operation, with both receiving BB ratings. The
assessment provides a credible and objective baseline to track progress as the
Company works to enhance sustainability practices and build long-term
resilience across the business. While we remain committed to maintaining
responsible operations, and recognise our role in supporting global energy
transition technologies through copper production, we are clear about where
further progress is required and are actively addressing those areas. This
will strengthen our ability to mitigate ESG risks and align with international
best practice.
We will also continue to report in line with TCFD standards, and the next
update will be provided in our 2025 Annual Report.
Outlook
Bringing two new mines and an associated flotation plant into production in
the same year is a significant achievement for the Company. The Group
continues to evaluate the production of Demirli and the reduction in copper
production from Gedabek due to the higher grades of ore from Gilar which have
required an upgrade to the flotation plant. Once these evaluations are
completed, the Group will issue revised guidance for the year.
Anglo Asian remains on track to deliver on its ambitious growth targets and to
become a mid-tier, multi-asset, primarily copper producer in the medium term.
Reza Vaziri
President and chief executive
24 September 2025
Corporate Governance
A statement of the Company's compliance with the ten principles of corporate
governance in the Quoted Companies Alliance Corporate Governance Code ('QCA
Code') can be found on the Company's website at
http://www.angloasianmining.com/media/pdf/CORPORATE_GOVERNANCE.pdf
(http://www.angloasianmining.com/media/pdf/CORPORATE_GOVERNANCE.pdf)
Competent Person Statement
The information in the announcement that relates to exploration results,
minerals resources and ore reserves is based on information compiled by Dr
Stephen Westhead, who is a full time employee of Anglo Asian Mining with the
position of Vice President. Dr Stephen Westhead is a Fellow of The Geological
Society of London, a Chartered Geologist, Fellow of the Society of Economic
Geologists, Fellow of The Institute of Materials, Minerals and Mining and a
Member of the Institute of Directors.
Dr Stephen Westhead has sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
being undertaken to qualify as a Competent Person as defined in the 2012
Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves'; who is a Member or Fellow of a
'Recognised Professional Organisation' (RPO) included in a list that is posted
on the ASX website from time to time (Chartered Geologist and Fellow of the
Geological Society and Fellow of the Institute of Material, Minerals and
Mining).
Dr Stephen Westhead has sufficient experience, relevant to the style of
mineralisation and type of deposit under consideration and to the activity
that he is undertaking, to qualify as a "competent person" as defined by the
AIM rules.
Dr Stephen Westhead has reviewed the resources and reserves included in this
announcement and consents to the inclusion in the announcement of the matters
based on his information in the form and context in which it appears.
Strategic report
Principal activities
Anglo Asian Mining PLC (the "Company"), together with its subsidiaries (the
"Group"), owns and operates gold, silver and copper producing properties in
the Republic of Azerbaijan ("Azerbaijan"). It also explores for, and develops,
gold and copper deposits in Azerbaijan.
The Group has a substantial portfolio of greenfield assets that lay the
foundation for future growth of the business. Gilar, Zafar, Xarxar and Garadag
all host significant ore deposits which contain total JORC mineral resources
(measured, indicated and inferred) of over one million tonnes of copper and
328,000 ounces of gold.
Production Sharing Agreement with the Government of Azerbaijan
The Group's mining concessions ("Contract Areas") in Azerbaijan are held under
a Production Sharing Agreement ("PSA") with the Government of Azerbaijan (the
"Government") dated 20 August 1997. Amendments to the PSA which granted the
Group additional Contract Areas, were passed into law in Azerbaijan on 5 July
2022.
A further amendment was made to the PSA which replaced the local party to the
PSA, the Ministry of Ecology and Natural Resources, with AzerGold Closed
Joint Stock Company ("AzerGold CJSC"). Minor amendments were also made in
respect of the use of facilities for the Kyzlbulag, Demirli and Vejnaly
Contract Areas. These amendments were passed into law in Azerbaijan on 21 June
2024.
Contract Areas in Azerbaijan
The Group has eight Contract Areas covering a total of 2,544 square kilometres
in western Azerbaijan:
o Gedabek. The location of the Group's primary gold, silver and copper open
pit mine and the Gadir and Gedabek underground mines. Gilar, a major new
underground mine, extracted its first ore in March 2025 and started production
in May 2025. The Zafar deposit is also situated at Gedabek. Gedabek also hosts
extensive processing facilities.
o Demirli. Located in Karabakh and adjacent to the Kyzlbulag Contract Area
which it extends to the northeast. It hosts a copper and molybdenum open pit
mine and a flotation processing plant.
o Xarxar. Located adjacent to the Gedabek and Garadag Contract Areas and
hosts the Xarxar deposit. It is likely part of the same mineral system.
o Garadag. Located to the north of Gedabek and Xarxar and hosts the large
Garadag copper deposit.
o Gosha. Located approximately 50 kilometres from Gedabek and hosts a
narrow-vein gold and silver mine.
o Vejnaly. Situated in the Zangilan district of Azerbaijan and hosts the
Vejnaly deposit.
o Ordubad. An early-stage gold and copper exploration area located in the
Nakhchivan exclave of Azerbaijan.
o Kyzlbulag. Situated in Karabakh and hosts the Kyzlbulag mine.
The Gedabek, Xarxar, Garadag and Gosha Contract Areas form a contiguous
territory totalling 1,408 square kilometres. The Group has been granted full
access to those areas of the Demirli Contract Area which have been subject to
land mine clearance. In accordance with the PSA, a four year exploration plan
for Demirli has been submitted to, and approved by, the Government. The Group
is currently undertaking the further formalities required to ensure Demirli
fully complies with the PSA. The Group has not been granted access to the
Kyzlbulag Contract Area, however, visits have been made to assess the site.
Overview of H1 2025
The Group's strategy is to transition into a mid-tier, copper focused
producer, which will be achieved through developing its considerable assets.
Production from the Group's agitation leaching and flotation plants had been
suspended in late 2023, with full production only restarting November 2024. H1
2025 is therefore the first reporting period since the partial shutdown with
continuous full production throughout the Period.
Gilar, a new underground mine at Gedabek, produced its first ore and entered
production in the Period. The Group continued its fast-track development of
Dermirli throughout the Period with the mine entering production shortly after
the Period end. The Group continued to make progress on strengthening its
Environment Social and Governance ('ESG') credentials. It received its
inaugural Sustainability rating from Digbee Ltd. ("Digbee"), an independent
provider of ESG disclosure and benchmarking for the mining sector.
Commencement of production from the Gilar mine
Development of the Gilar mine continued throughout the Period and in March
2025, the first ore was produced from Gilar. The mine commenced commercial
production in May 2025.
Prepayment agreement for the sale of concentrate
In May 2025, the Group's subsidiary, Azerbaijan International Mining Company
Limited, entered into a prepayment agreement with Trafigura Pte Ltd for the
sale of copper concentrate produced by Demirli.
Inaugural Sustainability rating from Digbee Ltd. ("Digbee")
In June 2025, the Group received its inaugural Sustainability rating
from Digbee, an independent provider of ESG disclosure and benchmarking for
the mining sector. An expert panel of globally recognized sustainability
professionals awarded Anglo Asian an overall BB rating for both its
corporate-level sustainability performance and that of its Gedabek asset.
Demirli development and commencement of production
The fast-track development of Demirli continued throughout the Period. Demirli
entered production shortly after the Period end in July 2025.
Raise of the wall of the tailings dam
The final raise of the wall of the tailings dam at Gedabek continued
throughout the Period.
Mineral resources and ore reserves
Key to the future development of the Group are the mineral resources and ore
reserves within its Contract Areas. Mineral resource and ore reserve estimates
are produced both in accordance with the JORC (2012) code ("JORC") and as
non-JORC compliant internal estimates.
Internal Group estimates have been prepared, in accordance with JORC
procedures, of the remaining mineralisation of the Gedabek open pit, the
Gedabek underground mine and the Gadir underground mine as at 1 January 2025.
These are set out in Tables 1 to 3 respectively.
A final JORC mineral resources estimate of the Zafar deposit at 30 November
2021 is set out in Table 4. A maiden JORC mineral resources estimate of the
Gilar deposit at 30 November 2023 was published on 11 December 2023 and is set
out in Table 5. A maiden JORC mineral resources estimate of copper in the
Xarxar deposit at January 2024 was published on 20 February 2024 and is set
out in Table 6.
The maiden JORC mineral resources estimate of copper in the Garadag deposit at
July 2024 was published on 24 September 2024 and is set out in Table 7. Table
8 sets out the Soviet mineral resources estimate for the Vejnaly deposit.
Table 9 sets out an internal Group estimate of the remaining mineral resources
of the Demirli deposit classified according to the JORC standard at 1 January
2025.
Table 1 - Internal Group estimate of the remaining mineralisation of the
Gedabek open pit in accordance with JORC at 1 January 2025
Tonnage In-situ grades Contained metal
(tonnes)
Gold Copper Silver Zinc Gold Copper Silver Zinc
(g/t) (%) (g/t) (%) (koz) (t) (koz) (t)
Measured and indicated 5,395,400 0.37 0.34 4.34 0.18 64 18,086 753 9,525
Inferred 226,575 0.55 0.17 2.58 0.09 4 388 19 208
Total 5,621,975 0.38 0.33 4.27 0.17 68 18,474 772 9,733
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
Table 2 - Internal Group estimate of the remaining mineralisation of the
Gedabek underground mine in accordance with JORC at 1 January 2025
Tonnage In-situ grades Contained metal
(tonnes)
Gold Copper Silver Zinc Gold Copper Silver Zinc
(g/t) (%) (g/t) (%) (koz) (t) (koz) (t)
Measured and indicated 348,933 1.33 0.05 13.46 0.44 15 191 151 1,539
Inferred 3,712 1.22 0.10 8.94 0.83 - 4 1 31
Total 352,645 1.33 0.06 13.41 0.45 15 195 152 1,570
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
Table 3 - Internal Group estimate of the remaining mineralisation of the Gadir
underground mine in accordance with JORC at 1 January 2025
Tonnage In-situ grades Contained metal
(tonnes)
Gold Copper Silver Zinc Gold Copper Silver Zinc
(g/t) (%) (g/t) (%) (koz) (t) (koz) (t)
Measured and indicated 15,483 2.38 0.64 23.97 0.52 1 99 12 81
Inferred - - - - - - - - -
Total 15,483 2.38 0.64 23.97 0.52 1 99 12 81
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
Table 4 - Final JORC mineral resources estimate of the Zafar deposit at 30
November 2021
Copper > 0.3 per cent. copper equivalent
Tonnage In-situ grades Contained metal
(million tonnes)
Copper Gold Zinc Copper Gold Zinc
(%) (g/t) (%) (kt) (kozs) (kt)
Measured and indicated 5.5 0.5 0.4 0.6 25 64 32
Inferred 1.3 0.2 0.2 0.3 3 9 3
Total 6.8 0.5 0.4 0.6 28 73 36
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
Table 5 - Maiden JORC mineral resources estimate of the Gilar deposit at 30
November 2023
Reporting cut-off >= 0.5 grammes per tonne of gold equivalent*
Tonnage In-situ grades Contained metal
(million tonnes)
Gold Copper Zinc Gold Copper Zinc
(g/t) (%) (%) (koz) (kt) (kt)
Measured 3.88 1.49 1.08 0.91 186.06 42.09 35.43
Indicated 2.02 1.00 0.56 0.48 64.80 11.30 9.77
Measured and indicated 5.90 1.32 0.90 0.77 250.86 53.39 45.20
Inferred 0.20 0.70 0.26 0.26 4.38 0.50 0.51
Total 6.10 1.30 0.88 0.75 255.24 53.89 45.72
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
*Gold equivalent calculation = Gold g/t plus (copper per cent.*1.49) plus
(zinc*0.46). The metal price assumptions used were Gold - $1,675 per ounce;
Copper - $8,000 per tonne; Zinc - $2,500 per tonne.
Table 6 - Maiden JORC mineral resources estimate of copper in the Xarxar
deposit at January 2024
Reporting cut-off >= 0.2 per cent. copper
Mineral resources estimate of copper in the Xarxar Deposit by oxidation domain
Domain
Indicated Inferred Indicated and inferred*
Tonnes Grade Metal Tonnes Grade Metal Tonnes Grade Metal
(mt) (%) (kt) (mt) (%) (kt) (mt) (%) (kt)
Oxide 5.2 0.55 28.5 0.8 0.66 5.2 5.9 0.57 33.7
Sulphide 16.8 0.46 77.9 2.1 0.35 7.6 18.9 0.45 85.5
Total 22.0 0.48 106.3 2.9 0.44 12.8 24.9 0.48 119.1
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
*Measured resources were nil due to insufficient third-party quality assurance
and quality control ("QAQC") drill core assays being carried out. Further QAQC
drill core assays will be carried out.
Table 7 - Maiden JORC mineral resources estimate of copper in the Garadag
deposit at July 2024 by domain
Domain Cut-off Indicated Inferred Indicated and inferred
Tonnes Grade Metal Tonnes Grade Metal Tonnes Grade Metal
(Mt) (Cu %) (kt) (Mt) (Cu %) (kt) (Mt) (Cu %) (kt)
0 (un-mineralised) 0.13% - - - - - - - - -
1 (leach) 0.13% - - - - - - - - -
3 (enriched) 0.13% 45.8 0.45 205.6 68.9 0.42 285.9 114.7 0.43 491.5
5 (primary) 0.13% 41.1 0.24 98.7 129.1 0.24 306.7 170.2 0.24 405.4
Total 86.9 0.35 304.3 198 0.30 592.6 284.9 0.32 896.9
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
Table 8 - Soviet mineral resources estimate of the Vejnaly deposit
Metal content
Units Category C1 Category C2 Total C1 and C2
Ore Tonnes 181,032 168,372 349,404
Gold Kilogrammes 2,148.5 2,264.2 4,412.7
Silver Kilogrammes 6,108.9 4,645.2 10,754.1
Copper Tonnes 1,593.6 1,348.8 2,942.4
Some of the totals in the above table may not sum due to rounding.
Table 9 - Internal Group estimate of the remaining mineral resources of the
Demirli deposit classified according to the JORC standard at 1 January 2025.
Ore tonnage In-situ grades Contained metal
(tonnes) Copper Copper
(%) (tonnes)
Measured 5,500,000 0.46 25,300
Indicated 9,508,981 0.45 41,946
Inferred 27,779,596 0.37 102,722
Non-classified 15,559,433 0.44 68,998
Total 58,348,010 0.41 238,966
Some of the totals in the above table may not sum due to rounding.
All tonnages reported are dry metric tonnes.
The above mineral resources estimate for Demirli is only in respect of the
mineral resources below the current open pit and does not include further
resources in the surrounding area.
Gedabek
Introduction
The Gedabek mining operation is located in a 300 square kilometre Contract
Area in the Lesser Caucasus mountains in western Azerbaijan on the Tethyan
Tectonic Belt, one of the world's most significant copper and gold-bearing
geological structures. Gedabek is the location of the Group's legacy Gedabek
open pit mine, and the Gadir and Gedabek underground mines. Gilar, a new
underground mine at Gedabek, entered production in May 2025. The Zafar mine at
Gedabek had minor development in 2023 but no further development has been
carried out. Gedabek is the location of extensive processing facilities
including flotation and agitation leaching plants. Heap leaching and SART
processing are also carried out.
Gold production at Gedabek commenced in September 2009. Ore was initially
mined from an open pit, with underground mining commencing in 2015, when the
Gadir mine was opened. In 2020, underground mining commenced beneath the main
open pit (the "Gedabek underground mine"). The Gedabek and Gadir underground
mines now form one continuous underground system of tunnels. Gilar, a major
new underground mine, commenced production in May 2025.
Initial gold production was by heap leaching, with copper production beginning
in 2010 from the Sulphidisation, Acidification, Recycling and Thickening
("SART") plant. The Group's agitation leaching plant commenced production in
2013 and its flotation plant in 2015. From the start of production to 30 June
2025, approximately 837 thousand ounces of gold and 22 thousand tonnes of
copper have been produced at Gedabek.
Gedabek open pit and Gedabek and Gadir underground mines
Conventional open-cast mining using trucks and shovels is carried out in the
Gedabek open pit (which comprises several contiguous smaller open pits). Ore
is also mined from the Gadir and Gedabek underground mines. These two
underground mines are connected, and form one continuous underground network
of tunnels, accessible from both the Gadir and Gedabek portals. However, a
significant fault structure separates the two mines.
Gilar underground mine
The Gilar underground mine is located approximately seven kilometres from the
Company's processing facilities and close to the northern boundary of the
Gedabek Contract Area. The mine entered production in May 2025.
The Gilar mine comprises two underground tunnels, a main production tunnel and
a second tunnel for ventilation. A spiral ramp accesses the ore body. The
lengths of the production and ventilation tunnels are 1,963 metres and 929
metres respectively. Spiral development of 311 metres and 1,532 metres of
stope development have also been completed. The walls of the tunnels are
supported by steel arches and shotcrete where necessary due to soft rock.
Water encountered underground is being pumped from the mine into a settling
pond constructed near the entrance to the mine.
Ore is mined by drill and blast using the sub-level caving method. Ore is then
extracted from the mine using a Caterpillar underground mining fleet which
consists of three R1700 and two 980UMA underground loaders.
Zafar mine development
The Zafar deposit was discovered in 2021 and is located 1.5 kilometres
northwest of the existing Gedabek processing plant.
A mining scoping study for the Zafar mine was completed in February 2023 and
development commenced. One of the two portals required for its ventilation and
haulage tunnels was constructed close to the existing Gedabek processing
facilities and about one kilometre from the mineralisation. Five metres of
haulage tunnel and 6.6 metres of ventilation tunnel were completed, prior to
suspension of development. Development of the Zafar mine was stopped in
mid-2023.
Table 10 shows all the ore mined by the Group in the year ended 31 December
2024 and six months ended 30 June 2025.
Table 10 - Ore mined at Gedabek for the year ended 31 December 2024 and 6
months ended 30 June 2025
12 months to 3 months to 3 Months
31 December 2024 31 March 2025 to 30 June 2025
Mine Ore mined Average Ore mined Average Ore mined Average
gold grade gold grade gold grade
(tonnes) (g/t) (tonnes) (g/t) (tonnes) (g/t)
Open pit 443,611 0.73 241,561 0.22 287,473 0.23
Gadir - u/g 167,121 1.58 12,325 2.21 - -
Gilar - - - - 106,510 1.23
Total 610,732 0.96 253,886 0.32 393,983 0.50
Processing operations
Ore is processed at Gedabek to produce either gold doré (an alloy of gold and
silver with small amounts of impurities, mainly copper) or a copper and
precious metal concentrate.
Gold doré is produced by cyanide leaching. Initial processing is to leach
(i.e. dissolve) the precious metal (and some copper) in a cyanide solution.
This is done by various methods:
1. Heap leaching of crushed ore. Crushed ore is heaped into permeable
"pads" onto which is sprayed a solution of cyanide. The solution dissolves the
metals as it percolates through the ore by gravity and it is then collected on
the impervious base under the pad.
2. Heap leaching of run of mine ("ROM") ore. The process is similar to
heap leaching for crushed ore, except the ore is not crushed, instead it is
heaped into pads as received from the mine (ROM) without further treatment or
crushing. This process is used for very low grade ores.
3. Agitation leaching. Ore is crushed and then milled in a grinding
circuit. The finely ground ore is placed in stirred (agitation) tanks
containing cyanide solution and the contained metal is dissolved in the
solution. Any coarse, free gold is separated using a centrifugal-type Knelson
concentrator.
Slurries produced by the above processes with dissolved metal in solution are
then transferred to a resin-in-pulp ("RIP") plant. In this plant, a synthetic
resin is used to selectively absorb the gold and silver from the slurry. The
metal-loaded resin is then "stripped" of its gold and silver by desorption
into another solution, from which the metals are recovered by electrolysis,
followed by smelting to produce the doré metal, which comprises an alloy of
gold and silver.
Copper and precious metal concentrates are produced by two processes, SART
processing and flotation.
1. Sulphidisation, Acidification, Recycling and Thickening ("SART"). The
cyanide solution after gold absorption by resin-in-pulp processing is
transferred to the SART plant. The pH of the solution is then changed by the
addition of reagents which precipitates the copper and any remaining silver
from the solution. The process also recovers cyanide from the solution, which
is recycled back to leaching.
2. Flotation. Finely ground ore is mixed with water to produce a slurry
called "pulp" and reagents are then added. This pulp is processed in flotation
cells (tanks), where the pulp is stirred and air introduced as small bubbles.
The sulphide mineral particles attach to the air bubbles and float to the
surface where they form a froth which is collected. This froth is dewatered to
form a mineral concentrate containing copper, gold and silver.
The Group's processing plants underwent extensive maintenance in 2023 and 2024
during the period when agitation leaching and flotation processing was
suspended. Extensive refurbishment of the agitation and flotation plants was
carried out, including installing a new hopper and redesigned pipework for the
agitation leach plant to improve ore feed. The ball mills were relined and
refurbished. Much of the work has improved safe working such as repairing
minor leaks, installing new floors and improving ladders and gantries. Roof
repairs have also been carried out where necessary. A substantial proportion
of the exterior of the plant has been cleaned by shot blasting and repainted.
Exterior pipework has also been cleaned or replaced as necessary.
Table 11 summarises the ore processed by leaching for the year ended 31
December 2024 and the six months ended 30 June 2025.
Table 11 - Ore processed by leaching at Gedabek for the year ended 31 December
2024 and the 6 months ended 31 December 2025
Quarter ended Ore processed Gold grade of ore processed
Heap leach pad crushed ore Heap leach pad ROM Agitation leaching plant* Heap leach pad crushed ore Heap leach pad ROM Agitation leachingplant*
(tonnes) ore (tonnes) (g/t) ore (g/t)
(tonnes) (g/t)
31 March 2024 120,528 - - 0.68 - -
30 June 2024 110,225 9,698 - 0.59 0.52 -
30 September 2024 110,152 - 18,009 0.65 - 1.93
31 December 2024 79,835 - 128,387 0.53 - 1.54
FY 2024 420,740 9,698 146,396 0.61 0.52 1.58
31 March 2025 106,429 - 149,763 0.40 - 1.16
30 June 2025 133,153 - 154,948 0.40 - 1.13
H1 2025 239,582 - 304,711 0.40 - 1.14
* includes previously heap leached ore.
Table 12 summarises the ore processed by flotation for the year ended 31
December 2024 and the six months ended 30 June 2025:
Table 12 - Ore processed by flotation for the year ended 31 December 2024 and
six months ended 30 June 2025
Quarter ended Ore processed Gold content Silver content Copper content
(tonnes) (ounces) (ounces) (tonnes)
31 March 2024 - - - -
30 June 2024 - - - -
30 September 2024 - - - -
31 December 2024 73,990 285 3,985 363
FY 2024 73,990 285 3,985 363
31 March 2025 155,406 535 9,516 729
30 June 2025 166,135 1,193 30,537 900
H1 2025 321,541 1,728 40,053 1,629
Previously heap leached ore
Gold production at Gedabek from 2009 to 2013 was by heap leaching crushed ore
until the start-up of the agitation leaching plant in 2013. The heaps remain
in-situ and given the high grade of ore processed prior to the commencement of
agitation leaching, and the lower recovery rates, much of the early heap
leached ore contains significant amounts of gold. This is now being
reprocessed by agitation leaching. Table 13 sets out the previously heap
leached ore processed for the six months ended 30 June 2025.
Table 13 - Previously heap leached ore processed for the six months ended 30
June 2025
In-situ material Average gold grade
(tonnes) (g/t)
1 January 2025 281,739 0.82
Processed in H1 2025 191,116 1.00
30 June 2025 90,623 0.86
The in-situ material is calculated at a standard cutoff grade of > 0.8
grammes per tonne of gold.
Production and sales
For the six months ended 30 June 2025, gold production totalled 12,115 ounces,
which was an increase of 7,411 ounces in comparison to the production of 4,704
ounces for the six months ended 30 June 2024. Copper production for the six
months ended 30 June 2025 was 1,188 tonnes compared to 100 tonnes for the six
months ended 30 June 2024, an increase of 1,088 tonnes. The higher production
of gold and copper in 2025 compared to 2024 arose as agitation and flotation
processing were operating throughout the Period.
Table 14 summarises the gold and silver bullion produced from doré bars and
sales of gold bullion for the year ended 31 December 2024 and 6 months ended
30 June 2025.
Table 14 - Gold and silver bullion produced from doré bars and sales of gold
bullion for the year ended 31 December 2024 and 6 months ended 30 June 2025
Quarter ended Gold produced* Silver produced* Gold sales** Gold Sales price
(ounces) (ounces) (ounces) ($/ounce)
31 March 2024 2,259 1,512 3,925 2,080
30 June 2024 2,433 1,532 2,075 2,350
30 September 2024 2,955 1,979 3,220 2,497
31 December 2024 7,280 6,974 6,031 2,655
FY 2024 14,927 12,007 15,251 2,432
31 March 2025 5,758 8,212 4,753 2,843
30 June 2025 5,624 6,699 5,028 3,299
H1 2025 11,382 14,911 9,781 3,077
* including Government of Azerbaijan's share
** excluding Government of Azerbaijan's share
Table 15 summarises the total copper, gold and silver produced as concentrate
by both SART and flotation processing for the year ended 31 December 2024 and
six months ended 30 June 2025.
Table 15 - Total copper, gold and silver produced as concentrate by both SART
and flotation processing for the year ended 31 December 2024 and six months
ended 30 June 2025
Concentrate Copper Gold Silver
production* content* content* content*
(dmt) (tonnes) (ounces) (ounces)
2024
Quarter ended 31 March
SART processing 89 54 7 4,893
Flotation - - - -
Total 89 54 7 4,893
Quarter ended 30 June
SART processing 77 46 5 4,809
Flotation - - - -
Total 77 46 5 4,809
Quarter ended 30 September
SART processing 19 11 1 1,336
Flotation - - - -
Total 19 11 1 1,336
Quarter ended 31 December
SART processing 34 17 2 3,549
Flotation 1,638 249 131 1,664
Total 1,672 266 133 5,213
2025
Quarter ended 31 March
SART processing 107 66 7 17,227
Flotation 2,965 468 264 4,882
Total 3,072 534 271 22,109
Quarter ended 30 June
SART processing 112 70 4 12,753
Flotation 3,411 584 458 12,581
Total 3,523 654 462 25,334
Notes
* including Government of Azerbaijan's share.
Certain amounts for SART and flotation production may differ to those
previously disclosed due to final reconciliation of production.
Table 16 summarises the total copper concentrate (including gold and silver)
production and sales from both SART and flotation processing for the year
ended 31 December 2024 and six months ended 30 June 2025.
Table 16 - Total copper concentrate (including gold and silver) production and
sales from both SART and flotation processing for the year ended 31 December
2024 and six months ended 30 June 2025
Concentrate Copper Gold Silver Concentrate
Concentrate
production* content* content* content* sales** sales**†
(dmt) (tonnes) (ounces) (ounces) (dmt) ($000)
Quarter ended
31 March 2024 89 54 7 4,893 71 295
30 June 2024 77 46 5 4,809 260 1,002
30 September 2024 19 11 1 1,336 - -
31 December 2024 1,672 266 133 5,213 1,173 1,493
FY 2024 1,857 377 146 16,251 1,504 2,790
31 March 2025 3,072 534 271 22,109 2,030 3,616
30 June 2025 3,523 654 462 25,334 3,402 6,299
H1 2025 6,595 1,188 733 47,443 5,432 9,915
* including Government of Azerbaijan's share
** excludes Government of Azerbaijan's share
† These are invoiced sales of the Group's share of production before any
accounting adjustments in respect of IFRS 15.
Infrastructure
The Gedabek Contract Area benefits from excellent infrastructure and access.
The site is located adjacent to the town of Gedabek, which is connected by
good metalled roads to the regional capital of Ganja. Baku, the capital of
Azerbaijan, is to the south and the country's border with Georgia to the
north, are each approximately a four to five hour drive over good quality
roads. The site is connected to the Azeri national power grid.
Water management
The Gedabek site has its own water treatment plant which was constructed in
2017, and which uses the latest reverse osmosis technology. In the last few
years, Gedabek town has experienced water shortages in the summer and this
plant reduces to the absolute minimum the consumption of fresh water required
by the Company.
Tailings (waste) storage
Tailings are stored in a purpose-built dam approximately seven kilometres from
the Group's processing facilities, topographically at a lower level than the
processing plant, thus allowing gravity assistance of tailings flow in the
slurry pipeline. Immediately downstream of the tailings dam is a reed bed
biological treatment system to purify any seepage from the dam before being
discharged safely into the nearby Shamkir river.
In August 2024, the Government of Azerbaijan issued approval for the final
raise of the existing tailings dam wall to go ahead. A further 6.0 metres wall
raise was authorised which will raise the wall to its final design height of
90 metres. The wall raise is being carried out in two back-to-back stages, and
the first raise of 2.5 metres was completed in November 2024. The final wall
raise of 3.5 metres is currently being carried out with completion expected in
the first half of 2026. The final raise of the wall will give the dam enough
capacity for the next two to three years of production.
Various sites have been identified for the location of the construction of a
second tailings dam at Gedebak. A technical report detailing the various sites
is currently being prepared which will be submitted to the Government prior to
selection of the final site.
Demirli
Introduction
The Demirli Contract Area is situated in the Karabakh economic region and is
74 square kilometres in size that extends to the northeast by about 10
kilometres from the Kyzlbulag Contract Area. The Demirli mining property
comprises an open pit mine, a processing plant, power and water infrastructure
and a tailings dam. The processing plant contains two rotary mills, a copper
flotation plant and a molybdenum plant. The capacity of the plant is around
6.5 million tonnes per annum. There is also an upstream tailings dam located
close to the plant. The mine entered production in July 2025.
Open pit mine
The open pit mine comprises a central and western open pit. It has been mined
for about the last 10 years. Ore is transported from the mine to the plant in
a fleet of Caterpillar 55.5 tonne and Komatsu 91 tonne trucks.
Processing operations
The plant comprises of a comminution circuit of a SAG and ball mill, banks of
flotation cells and a dewatering press to produce a copper concentrate. Ore is
fed through a hopper and then transported to the main body of the plant via a
conveyor belt. The ore is highly fractured and does not require any crushing.
It is fed directly into the SAG mill then to the ball mill to produce ground
ore. This is treated by flotation to produce a copper concentrate, which is
de-watered on a filter press.
Infrastructure and tailings dam
Tailings from the plant are sent to an upstream tailings dam, immediately
adjacent to the plant. The dam has had five wall raises and is almost full.
There is a small tailings water decant pond next to the plant for the storage
of water with an associated pumping station. Water is collected in the pond
from several sources in the surrounding region including a reservoir
approximately 14 kilometres from the plant. There is an electrical substation
and the plant is connected to the grid.
Xarxar
The 464 square kilometre Xarxar Contract Area is located immediately north of
the Gedabek Contract Area which it borders. The Xarxar Contract Area was
acquired in 2022 together with historical geological and other data owned by
AzerGold CJSC, its previous owner.
The Xarxar Contract Area hosts the Xarxar copper deposit. The mineralisation
of the deposit is copper dominant and comprises mainly oxides and secondary
sulphides, with minerals such as malachite, azurite, pyrite, chalcocite and
bornite, together with some primary chalcopyrite, as common minerals in the
deposit, and minor barite and magnetite minerals are also recorded. The main
copper mineralisation lenses are located in the central part of the Xarxar
deposit, with approximate east-west orientations.
On 20 February 2024, a maiden JORC mineral resources estimate was published
for the Xarxar deposit, which is set out in Table 6 above.
Gilar is situated close to the northern boundary of the Gedabek Contract Area.
Geological exploration indicates that this deposit trends to the north. The
Xarxar Contract Area extends the Gedabek Contract Area to the north and will
therefore enable the Gilar deposit to be fully mined.
Garadag
The 344 square kilometre Garadag Contract Area is situated four kilometres
north of Gedabek alongside the road from Gedabek to Shamkir. Garadag was first
explored during the Soviet era and has been extensively explored since then,
most recently by AzerGold CJSC, its previous owner. The roads built for drill
access are still accessible and serviceable on Garadag.
In 2022, the Group acquired historical geological and other data and
associated reports (the "Data") in respect of Garadag from AzerGold CJSC for
$3.3 million. The Data includes geochemical and geophysical data, including
maps and interpretative reports. Substantial core drilling and data
interpretations were carried out by Azergold CJSC and the Data includes 9,645
chemical assays taken from 23,454 metres of drill core, which have been
transferred to the Group. The Data also includes an initial mining scoping
study based on a preliminary mineral resource estimate with various options
for mine development, including open pit designs, initial mining schedules and
an outline metallurgical flow sheet. An environmental and socio-economic
baseline assessment has also been carried out and is included in the Data.
On 24 September 2024, the Company published a maiden JORC mineral resources
estimate of the Garadag deposit at July 2024. This showed a total in-situ
mineral resource (indicated and inferred) of 285 million tonnes of
mineralisation containing 897 thousand tonnes of copper at an average grade of
0.32 per cent. This maiden JORC resource is set out in Table 7 above.
Gosha
The Gosha Contract Area is 300 square kilometres in size and is situated in
western Azerbaijan, 50 kilometres northwest of Gedabek. Gosha is regarded as
under-explored. Gosha is the location of a small, high grade, underground gold
mine. Ore mined at Gosha is transported by road to Gedabek for processing. No
mining was carried out in the Gosha mine in the six months ended 30 June 2025.
Geological fieldwork has resulted in the discovery of additional
mineralisation adjacent to the existing underground mine. This includes
"Hasan", a sub-vertical high gold grade mineralised vein, immediately south of
the existing Gosha mine. Hasan can be accessed via a short tunnel from the
existing tunnelling at Gosha. A further vein close to Hasan called "Akir" is
also showing promising mineralisation.
The Group is also carrying out geological fieldwork at Asrikchay, a copper and
gold target situated within the Gosha Contract Area. Asrikchay is located in
the northeast corner of the Contract Area, about seven kilometres from the
Gosha mine, within the Asrikchay valley.
Vejnaly
Vejnaly is a 300 square kilometre Contract Area located in the Zangilan
district in southwest Azerbaijan. It borders Iran to the south and Armenia to
the west and hosts the Vejnaly deposit.
A thorough survey of the site has been carried out, which has found that the
main ore body was extensively mined during the Armenian occupation. There are
both open pit and underground workings at the location. There is also an
existing crusher and flotation processing plant at the mine, which will need
extensive renovation to recommence operations.
On 3 August 2023, staff were evacuated from Vejnaly on the instructions of the
Government of Azerbaijan due to the potential danger from landmines. At 30
June 2025, staff had still not received formal permission from the Government
of Azerbaijan to return to Vejnaly. Accordingly, no geological fieldwork was
carried out at the site in the six months ended 30 June 2025.
Ordubad
The 462 square kilometre Ordubad Contract Area is located in the Nakhchivan
exclave, southwest Azerbaijan, and contains numerous targets. Limited
geological exploration work was carried out in the six months ended 30 June
2025.
Kyzlbulag
The Kyzlbulag Contract Area is 300 square kilometres and is located in
Karabakh. It contains several mines and has excellent potential for
exploration, as indicated by the presence of many mineral deposits and known
targets in the region. There are indications that up to 35,000 ounces of gold
per year were extracted from the Kyzlbulag copper-gold mine, before the mine
was closed several years ago, indicating the presence of a gold mineralising
system.
Access to the Contract Area has still not been granted due to the presence of
landmines. However, various geological site visits have been made to the
Kyzlbulag Contract Area and sampling carried out in the six months ended 30
June 2025.
Geological exploration
Summary
· Minimal exploration work continued to be carried out in H1 2025 due
to strict cost control and the Group's focus on bringing the new Gilar and
Demirli mines into production.
· Limited underground drilling was carried out at the Gadir and Gilar
underground mines
· 20 underground drill holes totalling 957 metres completed at the
Gilar mine
· Four underground drill holes totalling 166 metres completed at the
Gadir mine
· Reverse circulation drill programme continued at Demirli to determine
remaining resource with an additional 45 drill holes completed with a total
length of 4,141 metres
· Comprehensive alteration map prepared
· Drill hole database digitised
· Trenching continued at Ordubad with 663 metres completed yielding 659
channel samples
· In-house analysis of samples from various deposits such as Zafar and
Xarxar continued throughout the Period
Gedabek
Gedabek open pit mine
No exploration was conducted at the Gedabek open pit mine in H1 2025. Drilling
activities continued to be carried out for grade control purposes.
Gadir underground mine
Four diamond drill holes totalling of 166 metres were completed. The aim of
the drilling is to delineate the detailed ore boundaries and support further
underground exploration between the 1,465 metre and 1,505 metre mining levels.
No underground sampling activities were carried out in H1 2025 as mining
operations are virtually complete.
Gilar
The area hosts two styles of mineralisation, gold in quartz veins and
hydrothermal gold-copper. Three mineralisation bodies have been discovered.
During H1 2025, channel sampling of the walls of the tunnel was carried out
with 61 underground samples taken with a total length of 71 metres.
Additionally, 20 underground core drill holes totalling 957 metres were
completed in the southern and southwestern flanks of the deposit. These areas
show significant potential for resource and reserve expansion.
Zafar
The geology of the area is structurally complex, comprising mainly of Upper
Bajocian-aged volcanics. The mineralisation seems to be associated with a main
northwest to southeast trending structure, which is interpreted as post-dating
smaller northeast to southwest structures. In the southwest area, outcrops
with tourmaline have been mapped, which can be indicative of the potential for
porphyry-style mineral formation.
There was no geological exploration carried out at Zafar in H1 2025. Given the
discovery of the second anomaly, similar to the original Zafar anomaly, thin
section and XRD investigation of samples were carried at the Group's in-house
mineralogical laboratory. The results show the area of the second anomaly has
significant potential for future exploration.
Demirli
A reverse circulation drill programme commenced in 2024 with 898 reverse
circulation drill holes completed to a depth of 10 metres each with a total
depth of 8,980 metres. This progamme continued in H1 2025 with an additional
45 reverse circulation totalling 4,141 metres completed. The purpose of the
programme is to determine the remaining resource in the current open pit.
A geotechnical investigation of the tailings dam commenced in H1 2025 with
eight geotechnical drill holes completed with a combined depth of 313 metres.
Seismic geophysical studies were also carried out. The purpose of this work
was to assess the structural stability of the tailings dam and its compliance
with safety and environmental standards.
A comprehensive structural alteration map of the Demirli mine has been
prepared along with the digitisation of the drill hole database. Based on this
work, and other data, an initial residual ore resource report has been
prepared and submitted to the Government of Azerbaijan. A more precise ore
resource estimate will be prepared following further sampling of existing
drill core and further drilling. 157 surface samples were collected in H1 2025
to support this more precise estimate.
Gosha
The Gosha mine was initially thought to consist of two narrow gold veins, zone
13 and zone 5. Mining has taken place from both veins. A further vein,
"Hasan", has also been discovered located immediately south of zone 5, which
it intersects at one point. The host rock mostly exhibits silicification and
kaolinisation alteration, which changes to quartz-haematite alteration in
andesite.
There was no geological exploration carried out at the Gosha mine in H1 2025.
Geological fieldwork activity continued at the Boyuk Gishlag mineralisation
occurrence within the Gosha Contract Area. Reconnaissance work focused on
assessing the mineralisation occurrences and identifying priority targets for
future exploration campaigns.
Xarxar
No geological fieldwork was carried out at Xarxar in H1 2025.
Scanning of the existing Xarxar drill core was completed during H1 2025 using
TerraCore technology. The scanning will support the development of a 3-D
alteration model. This model is essential to identifying further
mineralisation and ascertain the best metallurgical methods to process the
ore. TerraCore scanning is hyperspectral scanning which enables identification
of anomalies not visible to the naked eye. The scanning is being carried out
by TerraCore staff in Azerbaijan using a TerraCore scanner imported into
Azerbaijan. This is the first time hyperspectral scanning has been carried out
in Azerbaijan.
Garadag
No geological field work was carried out at Garadag in H1 2025. Detailed
assessment continued of the historical exploration data and metallurgical
studies to better understand the processing characteristics of the deposit's
mineralisation.
Ordubad
Trenching continued in H1 2025 in the Dirnis and Destabashi areas with 663
metres completed yielding 659 channel samples. Trenches were dug with a depth
of 10 metres to explore extensions of previously identified copper and silver
mineralisation. Consistent with earlier trenching campaigns, results confirmed
that mineralisation thickness increases by about 30 per cent. compared to
surface expressions.
Vejnaly
No geological fieldwork was carried out in H1 2025 as the Group did not have
access to the Contract Area.
In 2024, a "WorldView-3" study was completed by an independent company,
"Exploration Mapping USA", and a map prepared identifying mineralisation
targets. In H1 2025, the exploration team continued to develop a detailed
target mineralisation map. Once access to the Contract Area is restored,
in-house geological fieldwork will start exploring known gold targets and
targets identified by the "WorldView-3" study.
Sale of the Group's products
Important to the Group's success is its ability to transport its production to
market and sell them without disruption.
In the six months ended 30 June 2025, the Group shipped all its gold doré to
Switzerland for refining by MKS Finance SA. The logistics of transport and
sale are well established and gold doré shipped from Gedabek arrives in
Switzerland within three to five days. The proceeds of the estimated 90 per
cent. of the gold content of the doré can be settled within one to two days
of receipt of the doré. The Group, at its discretion, can sell the resulting
refined gold bullion to the refiner.
The Gedabek mine site has good road transportation links and copper and
precious metal concentrate is collected by truck from the Gedabek site by the
purchaser. The Group sells its copper concentrate to three metal traders as
detailed in note 2 to the Group financial statements. The contracts with each
metal trader are periodically renewed and each new contract requires the
approval of the Government of Azerbaijan.
Principal risks and uncertainties
Country risk in Azerbaijan
The Group's wholly owned operations are solely in Azerbaijan and are therefore
at risk of adverse changes to the regulatory or fiscal regime within the
country. However, Azerbaijan is outward looking and desirous of attracting
direct foreign investment and the Company believes the country will be
sensitive to the adverse effect of any proposed changes in the future. In
addition, Azerbaijan has historically had a stable operating environment and
the Company maintains very close links with all relevant authorities.
Operational risk
The Company produced all its products for sale in the Period at Gedabek.
Planned production may not be achieved as a result of unforeseen operational
problems, machinery malfunction or other disruptions. Operating costs and
profits for commercial production therefore remain subject to variation. The
Group monitors its production daily, and has robust procedures in place to
effectively manage these risks.
In the second half of 2025, the Company commenced production at its Demirli
Contract Area. The Group will monitor its production daily and has put in
place similar procedures to Gedabek to effectively manage the risks associated
with Demirli's operation.
Commodity price risk
The Group's revenues are exposed to fluctuations in the price of gold, silver
and copper and all fluctuations have a direct impact on the operating profit
and cash flow of the Group. Whilst the Group has no control over the selling
price of its commodities, it has very robust cost controls to minimise
expenditure to ensure it can withstand any prolonged period of commodity price
weakness. The Group actively monitors all changes in commodity prices to
understand the impact on its business. The directors keep under review the
potential benefit of hedging which it carries out from time to time.
Foreign currency risk
The Group reports in United States Dollars and a large proportion of its costs
are incurred in United States Dollars. It also conducts business in Euros,
Azerbaijan Manats and United Kingdom Sterling. The Group does not currently
hedge its exposure to other currencies, although it continues to review this
periodically.
Liquidity and interest rate risk
The Group utilised various credit lines from several banks in Azerbaijan
throughout the six months ended 30 June 2025. This was primarily to provide
working capital and finance for the Demirli start up. The banks loans were all
at a fixed rate of interest and therefore the Group had no interest rate risk
in respect of bank loans the six months ended 30 June 2025.
The Group also utilised a vendor financing facility which carries interest at
a rate of CME Term SOFR plus a margin of 2 per cent. Given the size of the
borrowing and relative stability of interest rates, the Group does not
consider that this variable rate presents any material interest rate risk to
the Group.
Russian invasion of Ukraine
The Company is unaffected directly by the Russian invasion of Ukraine or the
international sanctions levied against various private and governmental
Russian entities. However, the Company is subject to the global macro-economic
conditions resulting from the Russian invasion such as higher input costs.
Key performance indicators
The Group has adopted certain key performance indicators ("KPIs") which enable
it to measure its financial performance. These KPIs are as follows:
1 Profit before taxation. This is the key performance indicator used by
the Group. It gives insight into cost management, production growth and
performance efficiency.
2 Net cash provided by operating activities. This is a complementary
measure to profit before taxation and demonstrates conversion of underlying
earnings into cash. It provides additional insight into how we are managing
costs and increasing efficiency and productivity across the business in order
to deliver increasing returns.
3 Free cash flow ("FCF"). FCF is calculated as net cash from operating
activities, less expenditure on property, plant and equipment and mine
development, and Investment in exploration and evaluation assets including
other intangible assets.
Reza Vaziri
President and chief executive
24 September 2025
Financial review
Currency of financial review
References to "$" and "cents" are to United States dollars and cents.
References to "£" and "p" are to United Kingdom Sterling pounds and pence.
References to AZN are to the Azerbaijan New Manat and "m" are to million. Some
figures in the review below may not sum due to rounding.
Group statement of income
The Group generated revenues in the six months ended 30 June 2025 ("H1 2025")
of $40.9m (H1 2024: $13.4m) from the sales of gold and silver bullion and
copper and precious metal concentrate.
The revenues in H1 2025 included $30.5m (H1 2024: $12.9m) generated from the
sales of gold and silver bullion from the Group's share of the production of
gold doré bars. Bullion sales in H1 2025 were 9,781 ounces of gold and 13,902
ounces of silver (H1 2024: 6,000 ounces of gold and 4,846 ounces of silver) at
an average price of gold of $3,077 per ounce and an average price of silver of
$32 per ounce (H1 2024: $2,174 per ounce and $26 per ounce respectively). In
addition, the Group generated revenue in H1 2025 of $10.4m (H1 2024: $0.5m)
from the sale of 5,432 dry metric tonnes (H1 2024: 331 dry metric tonnes) of
copper and precious metal concentrate. The Group's revenue benefitted in H1
2025 from both a higher average price of gold at $3,077 (H1 2024: $2,204) per
ounce and a higher average price of copper at $9,445 (H1 2024: $8,998) per
metric tonne.
The were no gold sales made under any hedging programme in H1 2025. In March
and April 2024, 1,600 ounces of gold were sold under a hedging programme
started in 2023 at an average price of $1,976.85 per ounce. The Group
generated lower revenue in H1 2024 of $30,600 from the hedging programme,
calculated by comparing the hedged sale price with the spot price at each date
of sale
The Group incurred cost of sales in H1 2025 of $27.1m (H1 2024: $15.0m) as
follows:
H1 2025 H1 2024 B/(W)*
($m) ($m) ($m)
Cash cost of sales 25.3 14.9 (10.4)
Depreciation and amortisation 6.8 2.2 (4.6)
Cash costs, depreciation and amortisation 32.1 17.1 (15.0)
Capitalised costs - (1.3) (1.3)
Cost of sales before inventory movement and leases 32.1 15.8 (16.3)
Lease adjustments (0.1) (0.1) -
Inventory movement (4.9) (0.7) 4.2
Cost of sales per the Group statement of income 27.1 15.0 (12.1)
*B/(W) - Better or Worse
H1 2024 and H1 2025 cash costs reflect very different circumstances. In H1
2024, agitation leaching and flotation were suspended throughout the period
with only heap leaching and SART processing in operation. Mining was also
significantly reduced. All other variable costs such as reagents and materials
and consumables were very significantly reduced in H1 2024 due to the reduced
processing and mining activity. Agitation leaching and flotation were
restarted in late 2024 and therefore H1 2025 contains a full six months of all
processing costs.
Depreciation (including leased assets) increased by $4.6m from $2.2m in H1
2024 to $6.8m in H1 2025 due to higher gold production. Accumulated mine
development costs within producing mines are depreciated and amortised on a
unit-of-production basis over the economically recoverable reserves of the
mine concerned or by the straight-line method. The unit of account for run of
mine ("ROM") costs and for post-ROM costs are recoverable ounces of gold.
Administrative expenses in H1 2025 were $4.1m compared to $3.0m in H1 2024.
The Group's administrative expenses comprise the cost of the administrative
staff and associated costs at the Gedabek mine site, the Demirli mine site and
the Baku office. The administrative expenses also include executive salaries
and the cost of maintaining the Group as a UK listed company. The cost
increase in H1 2025 resulted from $0.8m of additional staff costs due to
establishing an administrative department at Demirli and increased
administration at the Baku office. Included in other operating expenses of
$0.9m in H1 2025 were transportation and refining costs of $0.6m.
Finance costs in H1 2025 were $1.7m (H1 2024: $1.2m) and comprise interest on
bank debt, interest on lease liabilities and a deposit received from a
customer, interest accretion expense on the rehabilitation provision and
interest on the AzerGold CJSC creditor. The finance costs in H1 2025 were
higher due to higher interest rates charged on bank borrowings and a higher
rehabilitation provision.
The Group recorded a profit before taxation in H1 2025 of $7.1m (H1 2024: loss
of $5.5m). The Group was profitable in H1 2025 due to higher sales as its
flotation and agitation leaching plants were in continuous production
throughout the Period. In H1 2024, neither flotation or agitation leaching
processing were in operation.
The Group had a taxation charge in H1 2025 of $2.4m (H1 2024: benefit of
$1.4m). This was a deferred tax charge of $2.4m (H1 2024: benefit of $1.4m).
R.V. Investment Group Services ("RVIG") in Azerbaijan generated taxable
profits in H1 2025 of $8.1m (H1 2024: losses of $3.7m) which were offset
against taxable losses carried forward from previous periods. RVIG's taxable
profits are taxed at 32 per cent. (the corporation tax rate stipulated in the
Group's production sharing agreement). RVIG had tax losses of $14.3m at 30
June 2025 (30 June 2024: $21.0m) and these losses will be carried forward and
offset against future taxable profits. RVIG has no other taxable losses
available for offset against future
profits.
All-in sustaining cost of gold production
The Group is now focused on copper which is becoming an increasing proportion
of its production. Accordingly, the Group will not now report an All-in
sustaining cost of gold production as it is not regarded as meaningful.
Group statement of financial position
Assets
Non-current assets increased from $103.7m at 31 December 2024 to $104.5m at 30
June 2025. Intangible assets increased from $24.0m at 31 December 2024 to
$24.4m at 30 June 2025 due to expenditure on geological exploration and
evaluation of $0.8m partially offset by amortisation of $0.4m in respect of
mining rights. Property, plant and equipment (including leased assets) at 30
June 2025 at $72.4m were lower by $0.9m compared to 31 December 2024 of
$73.3m. Additions to owned and leased fixed assets of $8.0m were offset by
depreciation of $6.7m in the Period and a reduction in the rehabilitation
provision of $2.3m.
Current assets were $51.9m at 30 June 2025 compared to $42.9m at 31 December
2024. The main reasons for the increase was an increase of cash of $4.4m and
an increase in current inventories of $3.8m. Inventories increased by $3.8m,
mainly due to an increase in metal in circuit of $3.5m as the gold ounces in
circuit increased due to resumption of full processing. Inventory included
1,176 ounces of unsold gold valued at $2.1m and 714 tonnes of unsold
concentrate valued at $1.2m at 30 June 2025. The Group's cash balances at 30
June 2025 were $5.3m (31 December 2024: $0.9m) and restricted cash of $6.0m
(31 December 2024: $6.0m) which is not available for use by the Company as it
is security for a loan. Surplus cash is maintained in US dollars.
Liabilities
Current liabilities at 30 June 2025 were $44.4m (31 December 2024: $38.9m).
Trade and other payables (excluding the amount owed to the Government of
Azerbaijan for gold held on its behalf) increased from $12.2m at 31 December
2024 to $16.6m at 30 June 2025. This was the result of actions to manage
working capital. Current liabilities at 30 June 2025 also include a $4.5m (31
December 2024: $nil) prepayment for the sale of concentrate received from
Trafigura Pte Ltd. This advance will be repaid from sales of concentrate under
the Group's existing contract with Trafigura Pte Ltd. and is expected to be
fully repaid within 12 months of the balance sheet date.
Non-current liabilities at 30 June 2025 includes trade and other payables of
$0.9m (31 December 2024: $0.5m). The non-current trade and other payables at
30 June 2024 include $3.3m in respect of the purchase of historical
exploration data of Xarxar and Garadag. This liability is payable in 2025 and
has been included in current trade and other payables at 31 December 2024 and
30 June 2025.
Borrowings
The total of the Group's bank borrowings and vendor financing loan decreased
from $21.6m at 31 December 2024 to $19.8m at 30 June 2025. There were no new
borrowings, and repayments of debt principal of $1.8m, were made during the
Period. The Group had bank borrowings from two banks in Azerbaijan during H1
2025, Access Bank and International Bank of Azerbaijan ("IBA"), and a
vendor financing loan from Caterpillar Financial Services
Corporation ("Caterpillar").
The Group's has a $5.6m loan from Access Bank which is secured against a $6.0m
cash deposit maintained at the bank. The loan carries interest at 0.5 per
cent. per month and is repayable in 6 equal monthly instalments starting in
January 2026.
The Group has a $5.0m bank loan from IBA which carries interest of 8.5 per
cent. In May 2025, the maturity of the loan was extended to May 2026. The
Group also has a $10.0m loan from IBA. The loan is repayable on a reducing
balance basis of 25 equal monthly repayments of $413,000 with the final
repayment in May 2026.
The Group received the proceeds of a vendor financing facility with
Caterpillar in H2 2024 of $3.7m. The interest rate is CME Term SOFR rate
plus a margin of 2 per cent. and repayment of capital is by 12 equal quarterly
instalments. The amounts outstanding at 31 December 2024 and 30 June 2025 were
$3.1m and $2.5m respectively. The loan is subject to a net debt to EBITDA
ratio covenant and a net worth covenant. The Group complied with the net debt
to EBITDA ratio covenant but not the net worth covenant at 30 June 2025, and
therefore in accordance with the amendments to IAS1, the entire loan has been
classified as a current liability. A waiver for the net worth covenant at 30
June 2025 has been obtained from Caterpillar.
Net assets
Net current assets were $7.5m at 30 June 2025 compared to $3.9m at 31 December
2024. The net current assets increased due to an increase in cash of $4.4m.
Net assets of the Group at 30 June 2025 were $72.0m (31 December 2024:
$67.4m). The net assets were higher due to an increase in retained earnings as
a result of the profit generated in H1 2025. There were no shares issued or
bought back in H1 2025.
Equity
The Group's gearing ratio at 30 June 2025 decreased to 31.3 per cent. (31
December 2024: 35.3 per cent.). The Group calculates its gearing ratio as its
total current and non-current debt (including lease liabilities) divided by
total equity and multiplied by 100. It is Group policy to keep its gearing
ratio below 70 per cent.
There were no movements of the Group's share capital, merger reserve and share
premium account in 2024 or H1 2025. The Group's holding company did not buy
back any ordinary shares in 2024 or H1 2025.
Copper Giant Resources Corp. (formerly Libero Copper & Gold Corporation)
("Copper Giant")
Copper Giant was an associate company of the Group at 31 December 2023 but on
15 February 2024 was reclassified as a financial asset as the Group's interest
reduced to 5.7 per cent. in January 2024 and Michael Sununu resigned from
the board of Copper Giant. The reversal of the impairment charge in H1 2024 of
$354,000 arose due to an increase in the share price of Copper Giant between 1
January and 15 February 2024.
From 15 February 2024, the investment in Copper Giant was included in the
Group's balance sheet by reference to their closing quoted value at each
respective balance sheet date. The market value of the Group's shares in
Copper Giant at 30 June 2025 was $334,000 (31 December 2024: $475,000 and 30
June 2024: $560,000). In H1 2025, an unrealised loss on the value of the
shares of $141,000 was recorded as other expense (H1 2024: unrealised profit
of $10,000 recorded as other income). The investment is classified as a
non-current financial asset as the directors do not intend to sell the shares
within 12 months of the balance sheet date.
Group statement of cash flow
Operating cash inflow before movements in working capital for H1 2025 was
$15.8m (H1 2024: outflow of $2.3m). The increase was due to the increased
revenue and resultant profitable trading in the Period.
Working capital movements in H1 2025 absorbed cash of $4.4m (H1 2024:
generated $5.5m). Trade and other payables increased by $5.5m and trade
debtors and other receivables increased by $4.6m. Inventories also increased
by $5.2m. These movements in working capital reflect continuous production
from flotation and agitation leaching processing throughout the Period.
There was net cash generated by operating activities in H1 2025 of $11.4m
compared to H1 2024 of $3.2m. The increased cash flow resulted from the
profitable trading in the Period.
The Group paid corporation tax in H1 2025 of $nil (H1 2024: $nil)
in Azerbaijan. There were sufficient taxable losses carried forward to offset
the taxable profits generated by RVIG in the Period.
Expenditure on property, plant and equipment in H1 2025 was $8.0m (H1 2024:
$6.3m). The main items of expenditure in H1 2025 were repairs and renovation
of the Demirli property of $3.8 million and Gilar development costs of $3.6
million.
Exploration and evaluation expenditure incurred and capitalised in H1 2025 was
$0.7m (H1 2024: $0.8m) with the majority expended on the Gedabek and Ordubad
Contract Areas. Exploration and evaluation activities were significantly
reduced in 2024 and H1 2025 to conserve funds.
There was a cash inflow in H1 2025 from financing activities of $1.4m (H1
2024: $1.2m). The inflow in H1 2025 included a $4.5m net advance received from
Trafigura Pte Ltd. This net advance has been classified as part of the Group's
financing cash flows as it is financing in nature.
Dividends
No dividend was declared or paid in respect of the year ending 31 December
2024 and the six months ended 30 June 2025.
A legal review was carried out in early 2025, of the distributions made to
shareholders by Anglo Asian Mining plc, following an enquiry from the United
Kingdom Financial Reporting Council in late 2024. The review found that the
Group's subsidiaries have ample distributable reserves, which can be
distributed to Anglo Asian Mining PLC, to pay dividends to shareholders and
buy back shares. However, certain technical provisions of the Companies Act
2006 had not been complied with in making those distributions.
A circular containing full details of the issues with distributable reserves
will be posted to shareholders on 29 September 2025. A General Meeting of the
Company will be held on 22 October 2025 at which a resolution will be put to
shareholders to rectify the issues. Details of the General Meeting are
contained in the circular.
Production sharing agreement
In accordance with the terms of the Production Sharing Agreement ("PSA") with
the Government of Azerbaijan (the "Government"), the Group and the
Government share the commercial products of each mine. The Government's share
is 51 per cent. of "Profit Production". Profit Production is defined as the
value of production, less all capital and operating cash costs incurred during
the period when the production took place. Profit Production for any period is
subject to a minimum of 25 per cent. of the value of the production. This is
to ensure the Government always receives a share of production. The minimum
Profit Production is applied when the total capital and operating cash costs
(including any unrecovered costs from previous periods) are greater than 75
per cent. of the value of production. All operating and capital cash costs in
excess of 75 per cent. of the value of production can be carried forward
indefinitely and set off against the value of future production.
Profit Production and unrecovered costs are calculated separately for each
contract area and costs incurred at one contract area cannot be offset against
production at another. Unrecovered costs can only be recovered against future
production from their respective contract area.
Profit Production for the Gedabek Contract Area has been subject to the
minimum 25 per cent. since commencement of production including both the year
to 31 December 2024 and the 6 months to 30 June 2025. The Government's share
of production in the six months to 30 June 2025 (as in all previous periods)
was therefore 12.75 per cent. being 51 per cent. of 25 per cent. with the
Group entitled to the remaining 87.25 per cent. The Group was therefore
subject to an effective royalty on its revenues from the Gedabek Contract Area
in the six months to 30 June 2025 of 12.75 per cent. (six months to 30 June
2024: 12.75 per cent.) of the value of its production.
The Group can recover the following costs in accordance with the PSA for each
Contract Area as follows:
o all direct operating expenses of the mine;
o all exploration expenses;
o all capital expenditure incurred on the mine;
o an allocation of corporate overheads - currently, overheads are apportioned
to Gedabek according to the ratio of direct capital and operating expenditure
at the Gedabek contract area compared with direct capital and operational
expenditure at the Gosha and Ordubad contract areas; and
o an imputed interest rate of United States Dollar LIBOR + 4 per cent. per
annum on any unrecovered costs.
The total unrecovered costs (operating costs and capital expenditure) for the
Group's eight contract areas are as follows:
Contract area Total unrecovered costs ($m)
30 June 2025 31 December 2024
Gedabek 79.4 82.0
Gosha 40.0 38.3
Ordubad 38.4 36.6
Vejnaly 2.5 2.3
Garadag* 1.8 1.4
Xarxar* 4.1 3.9
Demirli 6.8 0.3
Kyzlbulag - -
*The unrecovered costs include cash payments for historical geological data of
$0.8m and $0.2m in respect of Garadag and Xarxar respectively.
Foreign currency exposure
The Group reports in US dollars and a substantial proportion of its business
is conducted in either US dollars or the Azerbaijan Manat ("AZN") which has
been stable at AZN 1 equalling approximately $0.58 during the six months ended
30 June 2025. The Company's revenues and its debt facilities are also
denominated in US dollars. The Company does not currently have any significant
exposure to foreign exchange fluctuations and the situation is kept under
review.
Going concern
Preparation of financial statements on a going concern basis
The directors have prepared the Group financial statements on a going concern
basis after reviewing the Group's forecast cash position for the period from
the date of signing these financial statements to 30 September 2026 (the
"going concern review period") and satisfying themselves that the Group will
have sufficient funds on hand to meet its obligations as and when they fall
due over the period of their assessment. Appropriate rigour and diligence have
been applied by the directors who believe the assumptions are prepared on a
realistic basis using the best available information.
Main business of the Group
The Group produces gold and copper at its Gedabek mining concession in
northwestern Azerbaijan. Ore mined at Gedabek produces gold doré by heap and
agitation leaching and copper concentrate (which also contains gold and
silver) from SART and flotation processing. The Group's new Gilar underground
mine will substantially increase production in the second half of 2025 and
2026 as its ore is much richer than the Group's current mines. The Gilar mine
extracted its first ore in March 2025 and started production in May 2025 with
production expected to ramp up to 50,000 to 60,000 tonnes per month.
The Group also started copper production from its Demirli plant in Karabakh in
the going concern review period with first production in July 2025. Demirli is
an existing open pit copper mine and associated flotation plant which was
acquired in 2022 and has been extensively refurbished by the Group. It
produces a copper concentrate
Business plans for Gedabek and Demirli
The directors have prepared a cash flow forecast for the Gedabek site that
assumes production is consistent with the business plan and uses a gold price
of $3,100 per ounce and a copper price of $9,500 per tonne for the second half
of 2025 and 2026. This cash flow forecast shows the Group is able to fund its
working capital requirements from cash generated from its operations at
Gedabek. The cash flow also shows that the Group is able to fund its capital
expenditure requirements at Gedabek from its existing cash flow. The Group
generated $4.5 million of overall positive cash flow in the first half of 2025
from its Gedabek operation.
The directors have also prepared a cash flow forecast for the Group's new
Demirli operation which assumes production is consistent with the business
plan and uses a copper price of $9,500 per tonne for the second half of 2025
and 2026. The cash flow forecast shows that Demirli will be cash generative
following completion of commissioning of its plant. Any initial cash
shortfalls as it commences production due to working capital or other
requirements can be met from the cash generated from the Group's Gedabek
operations.
Financial condition and credit facilities available to the Group
The Group had cash reserves of $11.3 million (including $6.0 million
restricted cash) and debt (excluding leases but including an advance from
Trafigura) of $24.4 million at 30 June 2025.
The Group has in place an AZN 55 million ($32.3 million) General credit
agreement with the International Bank of Azerbaijan ("IBA") with minimal
conditions on drawdown. The Group has borrowed $10.0 million under this
facility of which $1.2 million was repaid in H1 2025. The balance is repayable
monthly between July 2025 to May 2026. The Group has also borrowed $5.0
million under the facility which was originally repayable in May 2024. The
repayment of the loan was extended by one year to May 2025, and in May 2025
was further extended by one year to May 2026.
The Group also finances its operations using concentrate prepayment facilities
established with Trafigura Pte Ltd. ("Trafigura"). A 3-month revolving, $5.0
million to $10.0 million prepayment facility has been established with
Trafigura for concentrate produced at Gedabek. At 30 June 2025, $4.5 million
was outstanding under this facility. The Group has also entered into a
contract with Trafigura for the purchase of its copper concentrate produced at
Demirli. The contract includes a revolving prepayment facility of up to $25
million at an interest rate of SOFR plus 4 per cent. per annum.
The Group closed a vendor refinancing in 2024 as part of the purchase
consideration of its Caterpillar mining fleet and received proceeds of $3.7
million. $2.5 million is outstanding at 30 June 2025 and the loan will be
repaid in quarterly instalments with the final instalment in July 2027. The
loan is subject to a net debt to EBITDA ratio covenant and a net worth
covenant. The Group complied with the net debt to EBITDA ratio but not the net
worth covenant at 30 June 2025. A waiver for the net worth covenant at 30 June
2025 has been obtained from Caterpillar.
Directors' going concern opinion
The directors have prepared the condensed Group interim financial statements
for the six months ended 30 June 2025 on a going concern basis after reviewing
the Group's forecast cash position for the period to 30 September 2026 and
satisfying themselves that the Group will have sufficient funds on hand to
meet its obligations as and when they fall due over the period of their
assessment. Appropriate rigour and diligence have been applied by the
directors who believe the assumptions are prepared on a realistic basis using
the best available information.
The Group's business activities, together with the factors likely to affect
its future development, performance and position, can be found within the
chairman's statement, the president and chief executive's review and the
strategic report above. The financial position of the Group, its cash flow,
liquidity position and borrowing facilities are discussed within the financial
review above.
William Morgan
Chief financial officer
24 September 2025
Anglo Asian Mining plc
Condensed group statement of income
Six months ended 30 June 2025
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
Continuing operations Notes $000 $000
Revenue 2 40,931 13,372
Cost of sales (27,114) (15,022)
Gross profit / (loss) 13,817 (1,650)
Other operating income 13 10
Administrative expenses (4,121) (2,995)
Other operating expenses (939) (97)
Operating profit / (loss) 8,770 (4,732)
Finance costs (1,676) (1,237)
Finance income 147 138
Other income 9 - 10
Other expense 9 (141) -
Share of loss of an associate company 3 - (46)
Reversal of impairment of an associate company 3 - 354
Profit / (loss) before tax 7,100 (5,513)
Income tax (expense) / benefit 4 (2,442) 1,426
Profit / (loss) attributable to the equity holders of the parent 4,658 (4,087)
4,658 (4,087)
Profit / (loss) per share attributable to the equity holders of the parent
Basic (US cents per share) 5 4.07 (3.57)
Diluted (US cents per share) 5 4.07 (3.57)
Anglo Asian Mining plc
Condensed group statement of comprehensive income
Six months ended 30 June 2025
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
$000 $000
Profit / (loss) for the period 4,658 (4,087)
Net other comprehensive profit that may be reclassified to profit or loss in
subsequent periods
- -
Total comprehensive income / (loss) for the period, net of tax
4,658 (4,087)
Anglo Asian Mining plc
Condensed group statement of financial position
30 June 2025
30 June 2024
30 June 2025 (unaudited) 31 December 2024
(unaudited) (audited)
Notes $000 $000 $000
Non-current assets
Intangible assets 6 24,363 27,764 23,998
Property, plant and equipment 7 70,214 68,454 71,606
Rights of use assets 8 2,171 1,738 1,690
Financial assets 9 334 560 475
Inventory 10 7,148 - 5,716
Other receivables 11 267 440 260
104,497 98,956 103,745
Current assets
Inventory 10 28,571 41,178 24,733
Trade and other receivables 11 12,077 8,314 11,262
Restricted cash 12 6,000 6,000 6,000
Cash and cash equivalents 12 5,267 1,946 886
51,915 57,438 42,881
Total assets 156,412 156,394 146,626
Current liabilities
Trade and other payables 13 (20,386) (14,734) (19,700)
Interest-bearing loans and borrowings 14 (18,303) (15,127) (18,546)
Advances 15 (4,481) (3,000) -
Lease liabilities 8 (1,244) (263) (691)
(44,414) (33,124) (38,937)
Net current assets 7,501 24,314 3,944
Non-current liabilities
Trade and other payables 13 (882) (3,254) (476)
Provision for rehabilitation (17,192) (13,715) (18,826)
Interest-bearing loans and borrowings 14 (1,545) (4,803) (3,083)
Lease liabilities 8 (1,431) (1,934) (1,456)
Deferred tax liability 4 (18,918) (18,838) (16,476)
(39,968) (42,544) (40,317)
Total liabilities (84,382) (75,668) (79,254)
Net assets 72,030 80,726 67,372
Equity
Share capital 16 2,016 2,016 2,016
Share premium 17 33 33 33
Treasury shares (145) (145) (145)
Share-based payment reserve 576 576 576
Merger reserve 46,206 46,206 46,206
Foreign currency translation reserve (172) (233) (172)
Retained earnings 23,516 32,273 18,858
Total equity 72,030 80,726 67,372
Anglo Asian Mining plc
Condensed group statement of cash flows
Six months ended 30 June 2025
Notes 6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
$000 $000
Cash flows from operating activities
Profit / (loss) before tax 7,100 (5,513)
Adjustments to reconcile profit / (loss) before tax to net cash flows:
Finance costs 14 1,676 1,237
Finance income (147) (138)
Unrealised loss / (profit) on financial instruments 9 141 (10)
Gain on the modification of lease liabilities 8 - (2)
Depreciation of owned assets 7 6,128 1,922
Depreciation of leased assets 8 552 330
Share based payment - 5
Share of loss of an associate company 3 - 46
Reversal of impairment of an associate company 3 - (354)
Amortisation of mining rights and other intangible assets 6 311 121
Foreign exchange loss 72 20
Operating cash inflow / (outflow) before movements in working capital 15,833 (2,336)
(Increase) / decrease in trade and other receivables 10 (4,631) 2,394
Increase in inventories 11 (5,273) (837)
Increase in trade and other payables 13 5,510 3,989
Cash generated from operations 11,439 3,210
Income taxes paid - -
Net cash generated by operating activities 11,439 3,210
Cash flows from investing activities
Expenditure on property, plant and equipment and mine development (7,962) (6,347)
Investment in exploration and evaluation activities (677) (760)
Interest received 162 163
Net cash used in investing activities (8,477) (6,944)
Cash flows from financing activities
Proceeds from borrowing 14 - 2,000
Repayment of borrowings 14 (1,785) (2,720)
Advances received for concentrate sales 15 11,500 3,000
Advances repaid by concentrate sales 15 (7,019) -
Interest paid - loans 14 (586) (641)
Interest paid - lease liabilities 8 (113) (129)
Repayment of lease liabilities 8 (506) (287)
Net cash used in financing activities 1,491 1,223
Net increase / (decrease) in cash and cash equivalents 4,453 (2,511)
Net foreign exchange difference (72) (20)
Cash and cash equivalents at beginning of period 12 886 4,477
Cash and cash equivalents at end of the period 12 5,267 1,946
Anglo Asian Mining plc
Condensed group statement of changes in equity
Six months ended 30 June 2025
(unaudited)
Share Share Merger Foreign currency translation Retained Total
capital premium Share-based reserve reserve earnings equity
$000 $000 Treasury payment $000 $000 $000 $000
shares reserve
$000 $000
1 January 2025 2,016 33 (145) 576 46,206 (172) 18,858 67,372
Profit for the period - - - - - - 4,658 4,658
Other comprehensive income / (loss) for the period - - - - - - -
-
-
Total comprehensive profit for the period - - - - - - 4,658 4,658
Share based payment - - - - - - - -
30 June 2025 2,016 33 (145) 576 46,206 (172) 23,516 72,030
Six months ended 30 June 2024
(unaudited)
Share Share Merger Foreign currency translation Retained Total
capital premium Share-based reserve reserve earnings equity
$000 $000 Treasury payment $000 $000 $000 $000
shares reserve
$000 $000
1 January 2024 2,016 33 (145) 571 46,206 (233) 36,360 84,808
Loss for the period - - - - - - (4,087) (4,087)
Other comprehensive income / (loss) for the - - - - - - - -
period
Total comprehensive loss for the period - - - - - - (4,087) (4,087)
Share based payment - - - 5 - - - 5
30 June 2024 2,016 33 (145) 576 46,206 (233) 32,273 80,726
Year ended 31 December 2024
(audited)
Notes Share Share Share-based Merger Foreign currency translation Retained Total
capital premium payment reserve reserve earnings equity
$000 $000 Treasury reserve $000 $000 $000 $000
shares $000
$000
1 January 2024 2,016 33 (145) 571 46,206 (233) 36,360 84,808
Loss for the year - - - - - - (17,502) (17,502)
Foreign currency translation reserve - - - - - 61 - 61
Share-based payment
- - - 5 - - - 5
31 December 2024 2,016 33 (145) 576 46,206 (172) 18,858 67,372
Anglo Asian Mining plc
Notes to the condensed Group interim financial statements
Six months ended 30 June 2025
1 General information
Anglo Asian Mining plc (the "Company") is a company incorporated in England
and Wales under the Companies Act 2006. The Company's ordinary shares are
traded on the AIM market of the London Stock Exchange plc. The Company is a
holding company. The principal activity of the Company and its subsidiaries
(the "Group") is operating a portfolio of mining operations and metal
production facilities within Azerbaijan. The Group also invests in mining
businesses outside of Azerbaijan.
Basis of preparation
The condensed Group interim financial statements for the six-month period
ending 30 June 2025 have been prepared in accordance with IAS 34 'Interim
Financial Reporting' as issued by the International Accounting Standards Board
and IAS 34 as adopted for use in the United Kingdom. The information for the
half year ended 30 June 2025 does not constitute statutory accounts as defined
in section 435 of the Companies Act 2006. A copy of the statutory accounts
for the year ended 31 December 2024 has been delivered to the Registrar of
Companies. The auditor's report on those accounts was not qualified and did
not contain a statement under sections 498(2) or 498(3) of the Companies Act
2006. The auditor's report on those accounts did not contain a statement of
"Material uncertainties relating to going concern". The condensed Group
interim financial statements have not been audited.
The condensed Group interim financial statements have been prepared under the
historical cost convention except for the treatment of share-based payments,
certain trade receivables at fair value, derivatives not designated as hedging
instruments and financial assets at fair value through profit and loss. The
condensed Group interim financial statements are presented in United States
dollars ("$") and all values are rounded to the nearest thousand except where
otherwise stated. In the condensed Group interim financial statements "£" and
"pence" are references to the United Kingdom pound sterling, "CAN$" and "CAN
cents" are references to Canadian dollars and cents and "AZN" is a reference
to the Azerbaijan New Manat.
Accounting policies and new standards, interpretations and amendments
The annual financial statements of Anglo Asian Mining plc are prepared in
accordance with UK adopted International Accounting Standards and in
conformity with the requirements of the Companies Act 2006. The condensed
Group interim financial statements included in this half-yearly financial
report have been prepared in accordance with IAS 34 'Interim Financial
Reporting' adopted by the UK and in conformity with the requirements of the
Companies Act 2006.
The accounting policies adopted in the preparation of the half-yearly
condensed Group interim financial statements for 2025 are consistent with
those followed in the preparation of the Group's annual report and accounts
for 2024, except for the adoption of new standards that became effective from
1 January 2025. The Group has not adopted any other standard, interpretation
or amendment that has been issued but is not yet effective.
The Group has adopted the following new amendment for the first time for the
interim reporting period commencing 1 January 2025:
o Lack of Exchangeability (Amendments to IAS 21 The Effects of Changes in
Foreign Exchange Rates).
The Group only uses freely exchangeable currencies for which there are
well-developed spot and forward markets. Accordingly, the Group believes that
the amendment has no effect on its interim financial statements.
Going concern
Preparation of financial statements on a going concern basis
The directors have prepared the Group financial statements on a going concern
basis after reviewing the Group's forecast cash position for the period from
the date of signing these financial statements to 30 September 2026 (the
"going concern review period") and satisfying themselves that the Group will
have sufficient funds on hand to meet its obligations as and when they fall
due over the period of their assessment. Appropriate rigour and diligence have
been applied by the directors who believe the assumptions are prepared on a
realistic basis using the best available information.
Main business of the Group
The Group produces gold and copper at its Gedabek mining concession in
northwestern Azerbaijan. Ore mined at Gedabek produces gold doré by heap and
agitation leaching and copper concentrate (which also contains gold and
silver) from SART and flotation processing. The Group's new Gilar underground
mine will substantially increase production in the second half of 2025 and
2026 as its ore is much richer than the Group's current mines. The Gilar mine
extracted its first ore in March 2025 and started production in May 2025 with
production expected to ramp up to 50,000 to 60,000 tonnes per month.
The Group also started copper production from its Demirli plant in Karabakh in
the going concern review period with first production in July 2025. Demirli is
an existing open pit copper mine and associated flotation plant which was
acquired in 2022 and has been extensively refurbished by the Group. It
produces a copper concentrate
Business plans for Gedabek and Demirli
The directors have prepared a cash flow forecast for the Gedabek site that
assumes production is consistent with the business plan and uses a gold price
of $3,100 per ounce and a copper price of $9,500 per tonne for the second half
of 2025 and 2026. This cash flow forecast shows the Group is able to fund its
working capital requirements from cash generated from its operations at
Gedabek. The cash flow also shows that the Group is able to fund its capital
expenditure requirements at Gedabek from its existing cash flow. The Group
generated $4.5 million of overall positive cash flow in the first half of 2025
from its Gedabek operation.
The directors have also prepared a cash flow forecast for the Group's new
Demirli operation which assumes production is consistent with the business
plan and uses a copper price of $9,500 per tonne for the second half of 2025
and 2026. The cash flow forecast shows that Demirli will be cash generative
following completion of commissioning of its plant. Any initial cash
shortfalls as it commences production due to working capital or other
requirements can be met from the cash generated from the Group's Gedabek
operations.
Financial condition and credit facilities available to the Group
The Group had cash reserves of $11.3 million (including $6.0 million
restricted cash) and debt (excluding leases but including an advance from
Trafigura) of $24.4 million at 30 June 2025.
The Group has in place an AZN 55 million ($32.3 million) General credit
agreement with the International Bank of Azerbaijan ("IBA") with minimal
conditions on drawdown. The Group has borrowed $10.0 million under this
facility of which $1.2 million was repaid in H1 2025. The balance is repayable
monthly between July 2025 to May 2026. The Group has also borrowed $5.0
million under the facility which was originally repayable in May 2024. The
repayment of the loan was extended by one year to May 2025, and in May 2025
was further extended by one year to May 2026.
The Group also finances its operations using concentrate prepayment facilities
established with Trafigura Pte Ltd. ("Trafigura"). A 3-month revolving, $5.0
million to $10.0 million prepayment facility has been established with
Trafigura for concentrate produced at Gedabek. At 30 June 2025, $4.5 million
was outstanding under this facility. The Group has also entered into a
contract with Trafigura for the purchase of its copper concentrate produced at
Demirli. The contract includes a revolving prepayment facility of up to $25
million at an interest rate of SOFR plus 4 per cent. per annum.
The Group closed a vendor refinancing in 2024 as part of the purchase
consideration of its Caterpillar mining fleet and received proceeds of $3.7
million. $2.5 million is outstanding at 30 June 2025 and the loan will be
repaid in quarterly instalments with the final instalment in July 2027. The
loan is subject to a net debt to EBITDA ratio covenant and a net worth
covenant. The Group complied with the net debt to EBITDA ratio but not the net
worth covenant at 30 June 2025. A waiver for the net worth covenant at 30 June
2025 has been obtained from Caterpillar.
Directors' going concern opinion
The directors have prepared the condensed Group interim financial statements
for the six months ended 30 June 2025 on a going concern basis after reviewing
the Group's forecast cash position for the period to 30 September 2026 and
satisfying themselves that the Group will have sufficient funds on hand to
meet its obligations as and when they fall due over the period of their
assessment. Appropriate rigour and diligence have been applied by the
directors who believe the assumptions are prepared on a realistic basis using
the best available information.
The Group's business activities, together with the factors likely to affect
its future development, performance and position, can be found within the
chairman's statement, the president and chief executive's review and the
strategic report above. The financial position of the Group, its cash flow,
liquidity position and borrowing facilities are discussed within the financial
review above.
2 Operating segments
The Group determines operating segments based on the information that is
internally provided to the Group's chief operating decision maker. The chief
operating decision maker has been identified as the board of directors. The
board of directors currently considers consolidated financial information for
the entire Group and reviews the business based on the Group income statement
and Group statement of financial position in their entireties. Accordingly,
the Group has only one operating segment, mining operations. The mining
operations comprise the Group's major producing asset, the open cast and
underground mines located at the Gedabek and Gosha licence areas, which
account for all the Group's revenues and the majority of its cost of sales,
depreciation and amortisation. The Group's mining operations are all located
within Azerbaijan and therefore all within one geographic segment.
Sales of gold within doré and gold and silver bullion in 2024 and 2025 were
made to the Group's gold refiners, MKS Finance SA which is based in
Switzerland.
The gold and copper concentrate was sold in the six months ended 30 June 2024
to Trafigura Pte Ltd and in the six months ended 30 June 2025 to Trafigura Pte
Ltd and Industrial Minerals SA.
3 Investment in an associate company
Copper Giant Resources Corp. ("Copper Giant") (formerly Libero Copper &
Gold Corporation) is a minerals exploration company listed on the TSX Venture
Exchange (ticker: CGNT) in Canada and owns the Mocoa copper property in
Colombia.
From 1 January 2023 to 15 February 2024, Copper Giant was an associate company
of the Group which held an interest ranging from 18.29 per cent. at 1 January
2023 to 13.11 per cent. at 15 February 2024. A Group director was also a
director of Copper Giant and the Group's vice president, technical services
was a member of the technical committee of Copper Giant. There were no
restrictions on the ability of the Group to transfer funds to Copper Giant and
for Copper Giant to transfer funds to the Group.
On 22 January 2024, Copper Giant announced a non-brokered private placement
for aggregate gross proceeds of up to CAN $3 million. The private placement
completed on 15 February 2024. The Company did not participate in the private
placement and its interest in Copper Giant reduced to approximately 5.9 per
cent following completion of the private placement. Michael Sununu resigned
from the board of directors of Copper Giant on 15 February 2024 and Copper
Giant ceased to be an associate company of the Group from that date.
The loss recognised for Copper Giant as an associate company for the six
months ended 30 June 2024, is the Group's share of the loss of Copper Giant
for the period 1 January 2024 to 15 February 2024. Subsequent to 15 February
2024, the Group's interest in Copper Giant is accounted for as a financial
asset. The Group's holding in Copper Giant from 15 February 2024 is valued at
each balance sheet date as the market value of its shares which corresponds to
the fair value.
On 15 February 2024 (the date Copper Giant ceased to be an associate company),
Copper Giant's carrying value as an associate company was $196,000 and the
market value of the Copper Giant's shares was $550,000. Accordingly, a release
of the impairment provision was made of $354,000 being the difference between
the market of Copper Giant's shares and its carrying value as an associate
company on 15 February 2024. Copper Giant was reclassified as a financial
asset at fair value through profit and loss at a value of $550,000.
Accordingly, no profit or loss was therefore recognised when Copper Giant was
reclassified. At 30 June 2024 Copper Giant was classified in the Group's
balance sheet as a financial asset (note 9 - "Financial assets").
The financial statements of Copper Giant are made up to 31 December of each
year. The financial information about Copper Giant, included in these Group
financial statements, has been taken from their unaudited financial statements
for the three months ended 31 March 2024 dated 28 May 2024.
The following tables illustrates the summarised financial information of the
Group's investment in Copper Giant:
Profit and loss account of Copper Giant from 1 January to 15 February 2024
1 January to
15 February 2024
(unaudited)*
$000
Expenses 513
Other expenses 63
Loss before taxation 576
Taxation -
Loss for the period 576
Reconciliation of loss in the period to loss of associate company in the Group
profit and loss account
Loss for the period 576
Exploration expense (236)
Loss for the period as an associate company
340
Group's share of the loss at 13.1 and 19.7 per cent.
46
*estimated by time apportionment from the unaudited financial statements of
Copper Giant for the 3 months
ended 31 March 2024.
4 Income tax
The income taxation charge for the 6 months ended 30 June 2025 represents a
current income tax charge of $nil (2024: $nil) and a deferred taxation charge
of $2.4 million (2024: benefit of $1.4 million). These current and deferred
taxation charges and credits are in respect of the representative office
registered in Azerbaijan of RV Investment Group Services LLC ("RVIG") (a
wholly owned subsidiary of the Company).
Deferred taxation assets or liabilities are calculated at the taxation rates
that are expected to apply in the period when the liability is settled or the
asset is realised. Deferred taxation is charged or credited in the income
statement, except when it relates to items charged or credited directly to
equity, in which case the deferred taxation is also dealt with in equity.
Deferred taxation assets and liabilities are offset when there is a legally
enforceable right to offset current taxation assets against current taxation
liabilities and when they relate to income taxes levied by the same taxation
authority and the Group intends to settle its current taxation assets and
liabilities on a net basis.
At 30 June 2025, RVIG had unused taxation losses available for offset against
future profits of $14.3 million (30 June 2024: $21.0 million and 31 December
2024: $22.4 million). A deferred taxation asset in respect of the losses of
$4.6 million (30 June 2024: $6.7 million and 31 December 2024: $7.2 million)
has been offset against other deferred taxation net liabilities in the Group
balance sheet. The Group also has unused taxation losses within the Company
and a subsidiary (Anglo Asian Operations Limited) available for offset against
future profits. No deferred taxation asset has been recognised in respect of
such losses due to the unpredictability of future profit streams. Unused
taxation losses may be carried forward indefinitely.
5 Profit / (loss) per ordinary share
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
$000 $000
Profit / (loss) after tax for the period 4,658 (4,087)
Basic profit / (loss) per share (US cents) 4.07 (3.57)
Diluted profit / (loss) per share (US cents) 4.07 (3.57)
Weighted average number of shares Number Number
For basic earnings per share 114,335,175 114,335,175
For diluted earnings per share 114,335,175 114,335,175
6 Intangible assets
Exploration and evaluation
Gedabek Gosha Ordubad Vejnaly Xarxar Garadag Demirli Mining rights Other intangible assets Total
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Cost
I January 2024 19,339 2,967 6,733 1,478 3,514 2,834 - 41,925 726 79,516
Additions 764 - 524 259 201 361 59 - - 2,168
Transfer to assets under construction (3,574) - - - - - - - - (3,574)
31 December 2024 16,529 2,967 7,257 1,737 3,715 3,195 59 41,925 726 78,110
Additions 420 - 150 71 10 2 35 - - 688
30 June 2025 16,949 2,967 7,407 1,808 3,725 3,197 94 41,925 726 78,798
Amortisation and impairment
1 January 2024 5,086 2,967 4,978 - - - - 38,815 544 52,390
Charge for the year - - - - - - - 387 21 408
Impairment 1,314 - - - - - - - - 1,314
31 December 2024 6,400 2,967 4,978 - - - - 39,202 565 54,112
Charge for the period - - - - - - - 311 12 323
30 June 2025 6,400 2,967 4,978 - - - - 39,513 577 54,435
Net book value
31 December 2024 10,129 - 2,279 1,737 3,715 3,195 59 2,723 161 23,998
30 June 2025 10,549 - 2,429 1,808 3,725 3,197 94 2,412 149 24,363
7 Property, plant and equipment
Plant and
equipment Producing mines Assets under construction Total
and motor vehicles (unaudited) (unaudited) (unaudited)
(unaudited)
$000 $000 $000 $000
Cost
1 January 2024 36,290 236,950 12,298 285,538
Additions 1,399 1,167 6,741 9,307
Transfer to producing mines - 1,044 (1,044) -
Transfer from intangibles - - 3,574 3,574
Increase in provision for 5,028
Rehabilitation - 5,028 -
31 December 2024 37,689 244,189 21,569 303,447
Additions 1,023 3,181 2,784 6,988
Change in provision for rehabilitation - (2,252) - (2,252)
30 June 2025 38,712 245,118 24,353 308,183
Depreciation and impairment
1 January 2024 25,337 195,426 - 220,763
Charge for year 2,011 8,533 - 10,544
Impairment of development assets - 534 - 534
31 December 2024 27,348 204,493 - 231,841
Charge for period 2,575 3,553 - 6,128
30 June 2025 29,923 208,046 - 237,969
Net book value
31 December 2024 10,341 39,696 21,569 71,606
30 June 2025 8,789 37,072 24,353 70,214
8 Leases
Right of use assets
Plant and equipment Producing mines Total
and motor vehicles (unaudited) (unaudited)
(unaudited)
$000 $000 $000
Cost
1 January 2024 3,163 1,153 4,316
Additions 443 - 443
Lease modifications (37) (48) (85)
31 December 2024 3,569 1,105 4,674
Additions 1,020 13 1,033
30 June 2025 4,589 1,118 5,707
Depreciation and impairment
1 January 2024 1,579 684 2,263
Charge for year 572 157 729
Lease modifications (8) - (8)
31 December 2024 2,143 841 2,984
Charge for period 481 71 552
30 June 2025 2,624 912 3,536
Net book value
31 December 2024 1,426 264 1,690
30 June 2025 1,965 206 2,171
Lease liabilities
Total
(unaudited)
$000
1 January 2024 2,471
Additions 443
Lease modifications (85)
Interest expense 280
Repayment (962)
31 December 2024 2,147
Addition 1,034
Interest expense 113
Repayment (619)
30 June 2025 2,675
30 June 2025 30 June 2024 (unaudited) 31 December 2024
(unaudited) $000 (audited)
$000 $000
Current liabilities 1,244 263 691
Non-current liabilities 1,431 1,934 1,456
Total lease liabilities 2,675 2,197 2,147
Amount recognised in the profit and loss account
6 months to 6 months to
30 June 2025 30 June 2024
(unaudited) (unaudited)
$000 $000
Depreciation expense of right to use assets 552 330
Interest expense 113 129
Expense relating to short leases 121 29
Gain on lease modifications - (2)
786 486
9 Financial assets
Non - current 30 June 2024 31 December 2024
(unaudited) (audited)
30 June 2025 (unaudited) $000 $000
$000
Financial assets at fair value through profit or loss
Listed equity investments 334 560 475
The Company holds 2,130,000 shares in Copper Giant Resources Corp. (formerly
Libero Copper & Gold Corporation), a company which is listed on the
Toronto Ventures Stock Exchange in Canada. The shares are valued at market
value by reference to their closing market price on the Toronto Ventures Stock
Exchange in Canada at each balance sheet date which corresponds to their fair
value.
The unrealised loss on the shares in the six months to 30 June 2025 of
$141,000 was debited to profit and loss account as other expense (six months
to 30 June 2024 - unrealised profit of $10,000 credited to profit and loss as
other income).
10 Inventory
Cost
30 June 2024 31 December 2024
30 June 2025 (unaudited) (unaudited) (audited)
Non-current assets $000 $000 $000
Ore stockpiles 7,148 - 5,716
30 June 2024 31 December 2024
30 June 2025 (unaudited) (unaudited) (audited)
Current assets $000 $000 $000
Finished goods - bullion 2,070 2,974 2,295
Finished goods - metal in concentrate 1,173 6 411
Metal in circuit 6,636 6,587 3,162
Metal in tailings dam 328 4,870 455
Ore stockpiles 376 8,311 953
Spare parts and consumables 17,988 18,430 17,457
Total current inventories 28,571 41,178 24,733
Total inventories at the lower of cost and net realisable value 35,719 41,178 30,449
The Group has capitalised mining costs related to high grade sulphide ore
stockpiled during 2024 and the 6 months ended 30 June 2025. Such
stockpiles are expected to be utilised as part of the flotation
processing. Current ore stockpiles consist of high-grade and low-grade oxide
ores that are expected to be processed during the 12 months subsequent to the
balance sheet date.
Inventory is recognised at lower of cost or net realisable value.
11 Trade and other receivables
Other receivables
30 June 2024
30 June 2025 (unaudited) (unaudited) 31 December 2024
$000 $000 (audited)
$000
Non-current
Advances for purchases - 195 -
Loans to employees* 267 - 260
Prepayments and advances - 245 -
267 440 260
Trade and other receivables
30 June 2025 (unaudited) 30 June 2024 31 December 2024
$000 (unaudited) (audited)
$000 $000
Current
Gold held due to the Government of Azerbaijan
3,778 3,531 7,471
VAT refund due 1,600 1,748 808
Loan to employee* 542 511 527
Other tax receivable 1,808 157 1,247
Trade receivables - fair value** - 82 44
Prepayments and advances 4,349 2,285 1,165
12,077 8,314 11,262
*See note 19 - "Related party transactions"
**Trade receivables subject to provisional pricing.
Trade receivables (not subject to provisional pricing) are for sales of gold
and silver to the refiner and are non interest-bearing and payment is usually
received one to two days after the date of sale.
Trade receivables (subject to provisional pricing) are for sales of gold and
copper concentrate and are non interest-bearing, but are exposed to future
commodity price movements over the quotational period ("QP") and, hence, fail
the 'solely payments of principal and interest' test and are measured at fair
value up until the date of settlement. These trade receivables are initially
measured at the amount which the Group expects to be entitled, being the
estimate of the price expected to be received at the end of the QP.
Approximately 90 per cent. of the provisional invoice (based on the
provisional price) is received in cash within one to two weeks from when the
concentrate is collected from site, which reduces the initial receivable
recognised under IFRS 15. The QPs can range between one and four months post
shipment and final payment is due between 30-90 days from the end of the QP.
The Group does not consider any trade or other receivables as past due or
impaired. All receivables at amortised cost have been received shortly after
the balance sheet date and therefore the Group does not consider that there is
any credit risk exposure. No provision for any expected credit loss has
therefore been established at 30 June 2024 and 2025 and 31 December 2024
The VAT refund due at 30 June 2025 and 2024 and 31 December 2024 relates to
VAT paid on purchases.
Gold bullion held and transferable to the Government is bullion held by the
Group due to the Government of Azerbaijan. The Group holds the Government's
share of the product from its mining activities and from time to time
transfers that product to the Government. A corresponding liability to the
Government is included in trade and other payables shown in note 13.
12 Restricted cash and cash and cash equivalents
Restricted cash comprises of a bank deposit in Azerbaijan which has been
pledged as security for a $5,650,000 loan from the bank. Details of the loan
are set out in note 14 - "Interest-bearing loans and borrowings".
Cash and cash equivalents consist of cash on hand and held by the Group within
financial institutions that are available immediately. The carrying amount of
these assets approximates their fair value.
The Group's cash and cash equivalents are mostly held in United States
Dollars.
13 Trade and other payables
Current 30 June 2024 (unaudited) 31 December 2024
30 June 2025 $000 (audited)
(unaudited) $000
$000
Accruals and other payables 5,413 3,705 2,330
Trade creditors 6,540 6,836 5,503
Gold held due to the Government of Azerbaijan 3,778 3,531 7,471
Geological data 3,540 - 3,379
Payable to the Government of Azerbaijan from copper concentrate joint sale 1,017
1,115 662
20,386 14,734 19,700
Non-current 30 June 2024 (unaudited) 31 December 2024
30 June 2025 $000 (audited)
(unaudited) $000
$000
Geological data - 3,254 -
Other payables 882 - 476
882 3,254 476
Trade creditors primarily comprise amounts outstanding for trade purchases and
ongoing costs. Trade creditors are non-interest bearing. Accruals and other
payables mainly consist of accruals made for accrued but not paid salaries,
bonuses, related payroll taxes and social contributions, accrued interest on
borrowings, and services provided but not billed to the Group by the end of
the reporting period. The directors consider that the carrying amount of trade
and other payables approximates to their fair value.
The amount payable to the Government of Azerbaijan from copper concentrate
joint sale represents the portion of cash received from the customer for the
government's portion from the joint sale of copper concentrate.
In the year ended 31 December 2022, the Group contracted with AzerGold CJSC to
pay $4.0 million (plus VAT) for the historical geological data AzerGold CJSC
owned in respect of the Garadag and Xarxar Contract Areas. The consideration
was apportioned as $3.3 million for Garadag data and $0.7 million for Xarxar
data. $1.0 million (25 per cent.) was paid in 2022 with the remaining $3.0
million (75 per cent.) payable after three years, or if earlier for each
respective deposit, the balance of the purchase price on the approval of the
Group's development and production programme for the deposit in accordance
with the Group's Production Sharing Agreement. The creditor has been
discounted at a rate of 8 per cent. being the risk-free rate. The repayment
dates of the creditor are the directors' best estimation of when repayment
will occur. The discounted amounts outstanding at each balance sheet date have
been grossed up by the VAT liability at a rate of 18 per cent. The amounts
outstanding at 30 June 2025 and 31 December 2024 have been classified as a
current liability (30 June 2024: classified as non-current liability).
14 Interest-bearing loans and borrowings
Interest rate Final maturity date 30 June 2025 30 June 2024 (unaudited) 31 December 2024 (audited)
(per cent.) (unaudited) $000 $000
$000
$5,000,000 bank loan 6.0 per annum May 2025 - 5,000 5,002
8.5 per annum May 2026 5,009 - -
$5,650,000 bank loan 0.5 per month June 2026 5,682 5,650 5,684
$10,000,000 bank loan 6.5 per annum May 2026 6,677 9,280 7,850
$3,708,000 vendor financing
SOFR + 2.0 per annum July 2027 2,480 - 3,093
19,848 19,930 21,629
Loans repayable in less than one year 18,303 15,127 18,546
Loans repayable in more than one year 1,545 4,803 3,083
19,848 19,930 21,629
The directors consider that the carrying amount of interest-bearing loans and
borrowings approximates to their fair value.
$5,000,000 bank loan
The loan is unsecured and was initially repayable in full on 11 May 2025 and
carried an interest rate of 6.0 per cent. In May 2025, it was extended for a
further 12 months till 11 May 2026 at an interest rate of 8.5 per cent.
$5,650,000 bank loan
The loan is secured against a $6 million deposit maintained with the lender.
The principal was originally repayable in 2 instalments of $2,818,659 and
$2,831,341 in March 2024 and April 2024 respectively. On 1 March 2024, the
term of the loan was extended for one year, with five instalments until 3
March 2025. The loan was further extended on 31 October 2024 and is repayable
in six equal monthly instalments starting in January 2026. The $6 million
deposit has been disclosed as restricted cash in the Group balance sheet at 30
June 2025 and 30 June 2024 and 31 December 2024.
$10,000,000 bank loan
The loan is unsecured. The borrowing commenced on 6 November 2023. The loan
had a 6-month capital repayment grace period during which only interest of
$54,167 per month was payable. From May 2024 till May 2026, 25 equal monthly
repayments of principal and interest totalling $413,306 will be made to repay
the principal on a monthly reducing balance basis. A final repayment of
principal and interest of $413,306 will also be made in May 2026.
$3,708,000 vendor financing
On 2 May 2024, Azerbaijan International Mining Company (a wholly owned
subsidiary of the Group) agreed and signed a vendor financing facility (the
"Facility") with Caterpillar Financial Services Corporation ("Cat
Financial"). On 26 August 2024 the Group received the full proceeds of
$3,708,000 from its vendor financing loan with Cat Financial. The loan is
secured against the underground mining equipment purchased under the agreement
for the Group's Gilar mine. The underground fleet cost $4.6 million which had
already been paid by the Group at 31 December 2023. $3,708,000 of the
purchase price was refinanced through the Facility. Other principal terms of
the facility were as follows:
- Guarantor: Anglo Asian Mining PLC
- Interest rate: CME Term SOFR rate plus a margin of 2 per
cent.
- Repayment of interest: quarterly
- Repayment of capital: 12 equal quarterly installments
- Net debt to EBITDA and net worth covenants
- Prepayment: allowed subject to a fee
The Group was in breach of various of the covenants on the Facility at 30 June
2025 and 31 December 2024. Accordingly, the entire loan has been classified as
a current liability at 30 June 2025 and 30 December 2024. The Group
subsequently obtained a waiver for the breach of the covenants at 30 June 2025
and 31 December 2024.
15 Advances
30 June 2024 (unaudited) 31 December 2024
30 June 2025 $000 (audited)
(unaudited) $000
$000
Prepayment for the sale of concentrate 4,481 3,000 -
The Group has entered into a prepayment agreement in regard of sales of copper
concentrate produced at Gedabek to Trafigura Pte Ltd ("Trafigura"), the
Group's main offtaker of copper concentrates. Under the agreement, Trafigura
makes advance payments to the Group for the purchase of copper concentrate.
The advance payments are settled either by the delivery of copper concentrate
to Trafigura under the Group's existing contract, or by cash payments to
Trafigura. The existing contract sets the sales price of the copper within the
concentrate by reference to the market price of copper at the date of sale.
The volume of concentrate deliveries to settle the advances will therefore
depend, inter alia, on the future market price of copper. The prepayments are
secured against certain fixed and mobile assets of the Group at Gedabek
including crushing and milling equipment and a crane.
The agreement has also granted Trafigura the exclusive right to purchase 50
per cent. of the first year of future production from the Demirli mine.
Demirli only started production after the 30 June 2025 and future production
is uncertain. In light of this uncertainty, the directors believe that no
value can be assigned to the exclusive right granted to Trafigura under the
contract. There were no outstanding amounts at 30 June 2024 or 2025 or 31
December 2024 in respect of the Demirli prepayment agreement.
The Group expects advances will be settled within 12 months of the balance
sheet date.
16 Share capital
Ordinary shares of 1 pence each $000
(unadited) (unaudited)
Ordinary shares issued and fully paid:
30 June 2025 and 2024 and 31 December 2024 114,392,024 2,016
150,000 ordinary shares were brought back during the year ended 31 December
2022 and are now held in treasury.
17 Share premium account
$000
(unaudited)
30 June 2025 and 2024 and 31 December 2024 33
18 Contingencies and commitments
Production sharing agreement
The Group undertakes its mining operations in the Republic of Azerbaijan
pursuant to the provisions of the Agreement on the Exploration, Development
and Production Sharing for the Prospective Gold Mining Areas: Gedabek, Gosha,
Ordubad Group (Piazbashi, Agyurt, Shakardara, Kiliyaki), Soutely, Kyzilbulag
and Vejnali Deposits dated year ended 20 August 1997 (the "PSA"). The original
agreement was dated 20 August 1997 and granted the Group mining rights over
the following contract areas containing mineral deposits: Gedabek, Gosha,
Ordubad Group (Piyazbashi, Agyurt, Shakardara, Kiliyaki), Soutely, Kyzilbulag
and Vejnali. On 5 July 2022, amendments to the PSA were ratified by the
Parliament of the Republic of Azerbaijan which granted the Group three new
contract areas with a combined area of 882 square kilometres and relinquished
the Soutely contract area. The parliamentary ratification was signed into law
on 5 July 2022 by the President of the Republic of Azerbaijan. In June 2024,
the local party, the Ministry of Ecology and Natural Resources, to the PSA was
replaced by AzerGold Closed Joint Stock Company. Minor amendments were also
made in respect of the use of facilities for the Kyzlbulag, Demirli and
Vejnaly contract areas.
The PSA contains various provisions relating to the obligations of the R.V.
Investment Group Services LLC ("RVIG"), a wholly owned subsidiary of the
Company. The principal provisions are regarding the exploration and
development programme, preparation and timely submission of reports to the
Government, compliance with environmental and ecological requirements. The
Directors believe that RVIG is in compliance with the requirements of the PSA.
The Group has announced a discovery on Gosha Mining Property in February
2011 and submitted the development programme to the Government according to
the PSA requirements, which was approved in 2012. In April 2012 the Group
announced a discovery on the Ordubad Group of Mining Properties and
submitted the development programme to the Government for review and
approval according to the PSA requirements. The Group and the Government are
still discussing the formal approval of the development programme.
The initial period of the mining licence for Gedabek was until March 2022. The
Company has the option to extend the licence for two five-year periods (ten
years in total) conditional upon satisfaction of certain requirements in the
PSA. The first of the five year extensions was obtained by the Company in
April 2021 and accordingly the mining licence now extends to March 2027 with a
further five year extension permitted.
RVIG is also required to comply with the clauses contained in the PSA relating
to environmental damage. The directors believe RVIG is substantially in
compliance with the environmental clauses contained in the PSA.
Lease with AzerGold Closed Joint Stock Company ("AzerGold") for the use of the
Demirli flotation plant
On 10 March 2025, RVIG entered into a lease with AzerGold for the lease of the
Demirli flotation plant. The lease will commence upon completion of certain
formalities by the Government. This is expected to happen by the end of 2025.
Until lease commencement, the Company is using the flotation plant without
payment but cannot sell the concentrate produced until the lease commences.
The lease is for three years and can be extended and RVIG can give 12 months'
notice at any time. The annual base rent is $24 million per annum ($2 million
per month). The base rent will be reduced, if in any calendar year, 75 per
cent. of revenue less operating and capital expenses is less than $24 million
(the "Minimum Rent"). The Minimum Rent will be paid for that year subject an
overall limit of a Minimum Rent payment of $15 million per annum. If 15 per
cent. of revenue in any year exceeds $28 million, the rent will be increased
to 15 per cent. of revenue less $4 million. This is provided 75 per cent. of
revenue less operating and capital expenses is greater than $28 million. The
rent will be included in the Demirli recoverable costs under the production
sharing agreement and will be deductible for tax.
19 Related party transactions
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note. Transactions between the Group and other related parties are disclosed
below.
Trading transactions
During the period, there were no trading transactions between group companies
and related parties who are not members of the Group.
Other related party transactions
(a) Total payments in the 6 months to 30 June 2025 of $1,078,000 (6 months
to 30 June 2024: $69,000) were made for equipment and spare parts purchased
from Proses Muhendislik Danismanlik Inshaat ve Tasarim Anonim Shirket
("PMDI"), an entity in which the vice president of technical services of
Azerbaijan International Mining Company has a direct ownership
interest. There is an outstanding payable to PMDI of $276,000 at 30 June 2025
(30 June 2024: $126,000 and 31 December 2024: $282,000).
(b) On 30 June 2022, a loan of $500,000 was made to the vice president of
technical services of Azerbaijan International Mining Company. The loan
carries an interest rate of 4 per cent. and was repayable on 30 June 2023 with
earlier repayment permissible. The loan is secured on the Anglo Asian Mining
plc shares owned by the vice president of technical services of Azerbaijan
International Mining Company. The loan was guaranteed by the president and
chief executive officer of Anglo Asian Mining plc. In June 2023, the loan was
renewed on the same terms as previously except the term of the loan was
extended for 3 years from the date of the original advance and the interest
rate was increased to 6 per cent.
(c) During 2023, Ilham Khalilov was promoted to Vice President, Azerbaijan
International Mining Company ("AIMC") and become a member of the key
management personnel of the Group. On 1 October 2020, AIMC lent $245,000 to
Ilham Khalilov for a period of 3 years. On 1 October 2023, the loan was
extended until 31 December 2026 at an interest rate of 6 per cent. No
repayments were made during the 6 months ended 30 June 2024 and 6 months ended
30 June 2025.
20 Post balance sheet events
Start of Production from Demirli
On 21 July 2025, the commissioning and first production from the Demirli
copper mine commenced in the Karabakh Economic Region of Azerbaijan.
Commissioning is expected to continue until the end of this year.
Receipt of waiver of loan covenant from Caterpillar Financial Services
Corporation ("Caterpillar")
On 11 September 2025, the Group received a waiver from Caterpillar for the
breach of the net worth loan covenant at 30 June 2025 included in its vendor
financing facility. The Group compiled with the net debt to EBITDA ratio
covenant for the six months to 30 June 2025.
21 Approval of condensed group interim financial statements
The condensed group interim financial statements of Anglo Asian Mining plc and
its subsidiaries for the six-month period ended 30 June 2025 were authorised
for issue in accordance with a resolution of the directors on 24 September
2025.
**ENDS**
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