REG - Gem Resources PLC - Annual Financial Report
30/04/2026 07:02
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RNS Number : 4610C Gem Resources PLC 30 April 2026
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION 2014/596/EU WHICH IS PART OF DOMESTIC UK LAW PURSUANT TO THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS (SI 2019/310) ("UK MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK MAR) IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
30 April 2026
Gem Resources plc
("GEMR" or the "Company")
Final results for the year ended 31 December 2025
Gem Resources plc (LSE: GEMR), the mineral exploration and mining group listed
on the Standard List segment of the main market of the London Stock Exchange
announces its audited results for the year ended 31 December 2025 (the "Annual
Report").
The full report is available on the Company's website at
https://gemresources.co.uk/publications/
(https://gemresources.co.uk/publications/) .
In accordance with Listing Rule 14.3.6R and 14.3.7R of the UK Financial
Conduct Authority ("FCA"), a copy of the Annual Report will also be submitted
to the FCA via the National Storage Mechanism and will shortly be available to
the public for inspection at:
https://www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
(https://www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism)
The Company will provide details of the Annual General Meeting in due course.
Enquiries:
Gem Resources plc +44 (0)746 368 6497
Chief Executive Officer info@gemresources.co.uk (mailto:info@gemresources.co.uk)
Bernard Olivier
Director
Peter Redmond
Peterhouse Capital Limited +44 (0)20 7469 0930
Joint Corporate Broker
Lucy Williams
Duncan Vasey
Capital Plus Partners
Joint Corporate Broker
Jon Critchley +44 (0)203 821 6169
All references to pages in the financial statements below refer to the Annual
Report which can be accessed via the link set out above.
GEM RESOURCES PLC
Annual Report and Consolidated Financial Statements
For the year ended 31 December 2025
Corporate Information
Directors Louis Ching Executive Chairman
Bernard Olivier Chief Executive Officer
Peter Redmond Non-Executive Director
Hans Wong Non-Executive Director
Edward Nealon Non-Executive Director
John Treacy Independent Non-Executive Director
Company Secretary OHS Secretaries Limited
Registered Office 9th Floor
107 Cheapside
London
EC2V 6DN
Company Number 05329401
Statutory Auditor PKF Littlejohn LLP
30 Churchill Place
London
E14 5RE
Share Registrar Computershare Services plc
P.O. Box 82
The Pavilions
Bridgwater Road
Bristol
BS99 7NH
Bankers Barclays Bank plc
Level 27
1 Churchill Place
London
E14 5HP
Solicitors Orrick Herrington & Sutcliffe LLP
107 Cheapside
London
EC2V 6DN
Brokers Albr Capital Limited
3rd Floor
80 Cheapside
London
EC2V 6EE
Capital Plus Partners
First Floor
85 Great Portland St
London
W1W 7LT
Chairman's Statement
Dear Shareholder
2025 was a year of transition and recapitalisation for Gem Resources Plc.
Since my appointment as Executive Chairman in September 2025, the Board has
focused on strengthening the balance sheet, improving governance and
reassessing the portfolio, rather than issuing frequent short‑term market
commentary.
Operational work continued at the Gravelotte project during the year,
including hard‑rock mining at the Cobra Open Pit and initial test sales of
emeralds and by‑products. These activities have been useful from a technical
and commercial standpoint, but Gravelotte is only one component of a broader
portfolio, and the Board continues to assess all assets through the lens of
overall shareholder value.
A key milestone was the recapitalisation announced in September 2025,
comprising a £617,320 equity subscription at 0.20 pence per share, a £1.5
million unsecured convertible loan note at a 50% premium to the subscription
price, and shareholder approval at the General Meeting held on 20 November
2025 for the proposed conversion of approximately £230,000 of outstanding and
accrued fees into equity on the same premium terms, which had not yet been
implemented as at year end. This significantly strengthened the Company's
financial position and provided a firmer platform for strategic initiatives.
The associated Board changes and approvals, including the Rule 9 waiver and
the resolutions passed at that General Meeting, have given the Company a
clearer mandate and enhanced governance.
In October 2025, the Board adopted GEMR's Cryptocurrency and Digital Asset
Treasury Policy, establishing a framework for holding approved digital assets
within treasury and commercial operations. This does not change GEMR's
identity as a natural resources company, but it broadens our tools for capital
management, including the option to accept payment for product sales in
digital assets while maintaining appropriate fiat liquidity.
Post period, in February 2026, GEMR completed its first allocation into
Bitcoin under this policy, acquiring 9.00000000 Bitcoin for a total cash
outlay of approximately US$634,684.60, funded entirely from existing cash.
This measured, initial step forms part of a wider capital allocation and
treasury diversification strategy and is not a change to the Group's core
business.
The Company now enters 2026 with refreshed leadership, a materially improved
capital base and a broader strategic toolkit than it had a year ago. The Board
is actively progressing corporate, financing and strategic initiatives aimed
at enhancing financial strength, improving flexibility and realising value
from the existing platform. While much of this work remains confidential at
this stage, I am encouraged by the progress made and the opportunities under
review.
On behalf of the Board, I thank shareholders for their patience and continued
support during this period of change and look forward to providing further
updates as developments materialise.
Louis Ching
Executive Chairman
Date: 29 April 2026
Strategic Report
The Directors present their Strategic Report for the year ended 31 December
2025.
Principal Activities
Throughout the period under review, Gem Resources Plc (the "Company" or
"GEMR") and its subsidiaries (the "Group") operated as a mining and mineral
exploration company. The principal activity of the Group during the year was
the advancement and development of its acquired assets, with the overarching
objective of creating long-term value for shareholders through capital growth
and/or dividends.
The Company's main strategic focus during the reporting period was as follows:
· to restart phase 1 of emerald production at the Gravelotte
Emerald Mine and to refine the processing and mining methodology to maximise
efficiency;
· additional exploration and pit optimisation work at Gravelotte;
· develop a detailed understanding of the available tailings and
ore at Gravelotte prior to commencing further mining activities and confirming
a route to market;
· commence early-stage development at the Curlew Emerald Mine in
Australia, with a view to restarting cost-effective mining and processing
operations in a phased and sustainable manner; and
· pursue joint venture opportunities for its strategic mineral
licence in Zambia, aimed at unlocking value through technical and commercial
partnerships.
Investing in small natural resource projects can be very rewarding, but
because of the issues and uncertainties arising from the principal risks
disclosed from page 9 below, there is a significant possibility of such reward
not materialising. As a result of the nature and size of the Group and Company
it will, in the early years particularly, be exposed to a concentration of
risk either by sector or geographically, or possibly both. These risks are
outlined in more detail below.
Licences
The Group's principal licences comprise the Gravelotte Mining Right, LP
30/5/1/2/2/153 MR, covering approximately 378.3275 hectares and valid until 23
July 2033, which may, subject to the MPRDA, be renewed for further periods of
up to 30 years at a time if the relevant renewal requirements are met; the
Curlew Mining Licence covering approximately 21.02 hectares and valid until 16
May 2044; Malaika Licence 26880-HQ-LEL covering approximately 965 km² and
currently under appeal following rejection of its renewal, although there can
be no assurance that such appeal will be successful and, given that
uncertainty, the relevant Zambia exploration project was impaired in the 2024
financial statements; and Malaika Licence 23239-HQ-LEL covering approximately
319 km², which expired on 30 January 2026 and is subject to a renewal
application which was duly submitted and is reflected on the Zambian Mining
Cadastre system. The Board believes that renewal of Licence 23239-HQ-LEL is
highly likely and, accordingly, continues to support the carrying value of the
related costs.
Review of Business and Development in the Year
A review of the year's activities and future prospects is contained in the
Chairman's Statement.
Financial and Performance Review
The Company recorded its first modest revenues of USD57,000 (£45,000)
consisting of the sale of mixed-to-low grade emeralds and historic tailings at
Gravelotte. Other projects remained pre-revenue for the period.
The Group and Company restated prior year numbers following a review of the
accounting of historic acquisitions. For details of restatement please refer
to note 28.
The results for the Company and Group are set out in detail in the financial
statements. The Company reports a loss of £0.7 million for the year ended 31
December 2025 (2024: £1.4 million as restated). The Group reports a loss of
£0.9 million for the year ended 31 December 2025 (2024: £1.9 million as
restated). The reduced loss in the current year is primarily attributable to
the non-recurrence of the impairment charge of £754,000 recognised in the
prior year.
Key Performance Indicators
The Company's primary financial key performance indicator ('KPI') at this
stage of its development is the monitoring of its cash balances. The Company's
cash as at 31 December 2025 was £129,000 (2024: £283,000). The Group's cash
as at 31 December 2025 was £1,613,000 (2024: £414,000).
The critical non-financial KPI during the period was the ability of the Group
and Company to develop its principal exploration project (Gravelotte) to the
point of being in a position to record its first sales. Whilst the Company
did record some sales from Gravelotte during the period, these sales were a
small trial parcel of emeralds. The majority of this parcel were recovered
from existing tailings piles on the mine site. The Directors believe that this
is not a sufficient scale of sales to make the move to non-financial KPIs
worthwhile at this time but will do so once the Gravelotte mine has
recommenced full commercial scale mining and production and can undertake
regular sales of more significant parcels of emeralds.
Cashflow
During the year, net cash outflow from Group operating activities was
£781,000 (2024: £550,000). Cashflow forecasts are reported to the Board
whenever the Board meets, to ensure progress is in line with budget. Long term
forecasts are also provided to ensure that the strategy of the business can be
adequately funded.
The Group raised cash net of costs of £567,000 (2024: £727,000) during the
year from placing of Ordinary Shares and raised £1.5 million from the
issuance of unsecured convertible loan notes.
The Group had a £1,247,000 net increase (2024: £256,000 decrease) in cash
and cash equivalents at year end.
Balance Sheet
During 2025, non-current assets marginally decreased to £859,000 (2024:
£893,000 restated), partly due to depreciation and amortisation.
The total liabilities increased to £1,805,000 (2024: £489,000 restated).
This resulted primarily from the issue of convertible loan notes.
Cash has mainly been used to fund the Group's operations and corporate
activities. Administrative expenses are the expenses related to the Group's
ability to run the corporate functions to ensure it can perform its
operational commitments. Exploration costs, capitalised during the year,
consist of exploration expenditure on the Group's exploration licences.
Risk & Uncertainties
This business carries a high level of risk and uncertainty, although the
potential rewards can be outstanding. The Directors have identified the
following principal risks in regards to the Group's future. The relative
significance of the Group's risks is likely to change as we execute our
strategy and as external conditions evolve, including developments and
exploration results that may require adjustments to our strategic priorities.
Key elements of this process are the Group's reporting at Board meetings. The
main risks include:
Strategic risk
The Group's strategy may not deliver the results expected by shareholders. The
Directors regularly monitor the appropriateness of the strategy, taking into
account both internal and external factors, together with progress in, and
modification to, the Company's strategy.
Geographic Risks
The concentration of the Group's licences lies in three projects: the
Gravelotte Emerald Mine, Curlew Emerald Mine and Strategic Mineral Projects,
located in South Africa, Australia and Zambia, respectively.
The limited number of separate projects and ongoing investments creates risk.
The Company is an African and Australian focused mining company with a
particular focus on coloured gemstones, specifically, emeralds at the
Gravelotte and Curlew Emerald Mines and high-grade graphite, coltan
(containing niobium & tantalum), lithium, and rare earth elements (REEs)
at the Strategic Mineral Projects.
The Group has limited diversification in its asset base in South Africa,
Australia and Zambia. In view of its initial focus on the Gravelotte Emerald
Mine, the Group will be exposed to the concentration risk of only having
current operations in the coloured gemstones sector, where concentration risk
may further relate to sub-sector, geography, the relative size of an
investment or other factors. The Group has focused its investment strategy on
the Gravelotte Emerald Mine, which, as a result, may expose the Group to
country and local government-associated risk, and fluctuations in the demand
for and the price of gemstones, specifically, emeralds and in the future,
high-grade graphite, coltan (containing niobium & tantalum), lithium, and
rare earth elements (REEs). Any delay in the active development of the
Gravelotte Emerald Mine, or any unexpected interference in operations in the
coloured gemstones sector, could, in turn, materially adversely affect the
revenue, business, results of operations and financial condition of the Group.
Access to infrastructure
Mining, processing, development and exploration activities depend, to a
significant degree, on adequate infrastructure. Reliable roads, power sources
and water supply are important determinants, which affect capital and
operating costs.
Unusual or infrequent weather phenomena, sabotage, government or other
interference in the maintenance or provision of such infrastructure could
materially adversely affect the Group's operations, financial condition and
results of operations. Any such issues arising in respect of the supporting
infrastructure or on the Group's sites could materially adversely affect the
Group's results of operations or financial condition.
Furthermore, any failure or unavailability of the Group's operational
infrastructure (for example, through equipment failure) could materially
adversely affect the production output from its mines or development of a mine
or project.
Operational Risks
There can be no guarantee of the results of any detailed exploration activity
at the Strategic Minerals Project. The prospects of the discovery of
commercially viable mineral resources and ore reserves on the Group's
exploratory licence area associated with the Strategic Minerals Project are
based on the judgement of the Directors, and historical data from the
Strategic Minerals Project (and adjacent areas which are anticipated to have
similar geology). Whilst the Directors have engaged geologists to support and
inform their decisions to acquire interests in the exploration licence area
associated with the Strategic Minerals Project, no mineral resource and
reserve estimate has, to date, been prepared in relation to it. Until the
Group carries out extensive and detailed exploration studies on the licence
areas, the assumptions as to the presence of mineral resources and ore
reserves on the exploration licence area associated with the Strategic
Minerals Project, remain based on theoretical and limited anecdotal physical
evidence and data.
Mineral exploration is an inherently speculative activity. The Group holds one
exploration licence in Zambia in respect of the Strategic Minerals Project and
is at an early stage of exploration in these licence areas. The Strategic
Minerals Project has been selected on the basis of a set of prevailing
geological conditions in the associated exploration licence area, however the
asset base has yet to be comprehensively explored or tested. In the event that
further exploration and/or testing reveals that the Strategic Minerals Project
does not have a viable asset base, the Group will rely heavily on the benefit
of having the acquired Curlew Emerald Mine in Australia and a JORC compliant
maiden mineral resource estimate for the Gravelotte Emerald Mine in South
Africa.
In the event that the geology in the associated licence areas turns out to be
other than as expected and even if the geology is as anticipated, there is
significant risk after spending significant sums on exploration and testing
activity that no commercially viable mineral resources and ore reserves will
be discovered. There is, accordingly, a material risk that activity at the
Strategic Minerals Project could yield results that are materially below
expectations which could, in turn, materially adversely affect the revenue,
business, results of operations and financial condition of the Group.
The financial performance of the Group is also subject to its ability to
achieve production at its Gravelotte Emerald and Curlew Mine at target
quantities and quality. Failure to do so may result in a material adverse
impact on the business, operations and financial performance of the Group.
Any unscheduled interruptions in the Group's operations due to mechanical,
electrical or other failures or industrial relations related issues or
problems or issues with the supply of goods or services, could have a serious
impact on the financial performance of those operations.
Legal and Regulatory Risks
The Group's activities in South Africa are subject to extensive laws and
regulations governing mining and mineral exploration companies. For example,
the Mineral and Petroleum Resources Development Act No. 28 of 2002 and the
MPRDA Amendment Act No.49 of 2008 ("MPRDA"), the Mineral and Petroleum
Resources Royalty Act 2008, the Mining Titles Registration Act 1967, the
Precious Metals Act 2005, National Environmental Management Act 1998 (NEMA)
and Diamonds Act 1986 regulate mining in South Africa. The MPRDA outlines key
requirements for exploration companies including imposing on these companies
the obligation, after a prospecting right or mining right is granted, to lodge
for registration with the Mineral and Petroleum Titles Registration Office
within 60 days of the notarial execution of the mining right. The holder of
the mining rights has various obligations during the duration of the right,
such as reporting obligations. There are additional considerations related to
environmental regulations and authorisations which are required for
prospecting or mining operations and related activities, including the
requirement by the Department of Mineral Resources and Energy of South Africa
("DMRE") to grant environmental authorisations and approve prescribed
financial provisions (the amounts set aside by mining companies for the
remediation and rehabilitation of the environment in relation to mining
activities).
The Group's current and prospective activities in Australia will similarly be
governed by extensive laws and regulations pertaining to environmental
protection, mining, and land use. Key legislative frameworks include the
Environmental Protection and Biodiversity Conservation Act 1999 (EPBC Act),
which outlines requirements for environmental assessments and approvals for
projects likely to have significant impacts on matters of national
environmental significance. The Group's compliance obligations also extend to
the Mining Act 1978 (Western Australia), the Work Health and Safety Act 2011,
and the Aboriginal Heritage Act 1972 (Western Australia), which protects
culturally significant sites. Australian states also enforce specific
environmental and mining regulations, including the obligation to submit
environmental management plans, remediation strategies, and financial
assurance for mine site rehabilitation. Additionally, the Australian
government requires mining operators to obtain permits for water use, waste
management, and greenhouse gas emissions under various federal and state
regulations. Non-compliance with these requirements can result in significant
penalties, project delays, and/or operational restrictions.
The Group's operating activities in Zambia are subject to extensive laws and
regulations governing waste disposal, protection of the environment, mine
development, land and water use, prospecting, mineral production and other
matters in Zambia (including the protection of Aboriginal heritage sites)
under the Zambian Environmental Act, the Occupational Health and Safety Act
No. 36 of 2010, the Mines and Minerals (Environmental) Regulations No. 29 of
1997 and the Environmental Protection and Pollution Control (Environmental
Impact Assessment) Regulations SI No. 28 of 1997 (EIA Regulations).
Environmental considerations are integral to the Group's operations across all
jurisdictions. In Zambia, South Africa, and Australia, compliance with
environmental laws encompasses obtaining permits for activities that may
affect air, water, or soil quality, implementing mitigation measures to manage
environmental risks, and adhering to stringent monitoring and reporting
requirements. The Group is committed to sustainable practices, ensuring that
operations align with environmental, social, and governance (ESG) principles,
particularly with respect to the remediation and rehabilitation of affected
sites and reducing the environmental footprint of its activities.
Market and Commodity Price Risks
The financial health of the Group is significantly tied to the market prices
of emeralds and other minerals. Price drops can decrease asset valuations,
diminish revenue, and reduce overall profitability, thereby affecting the
Group's financial condition and operational viability.
Political, Economic and Regulatory regime
The licences and operations of the Group are in jurisdictions outside the
United Kingdom and accordingly, there will be a number of risks which the
Group will be unable to control. Whilst the Group will make every effort to
ensure it has robust commercial agreements covering its activities, there is a
risk that the Group's activities will be adversely affected by economic and
political factors such as the imposition of additional taxes and charges,
cancellation or suspension of licences and changes to the laws governing
mineral exploration and operations.
The Group's activities will be dependent upon the granting of appropriate
licences, concessions, leases, permits, and regulatory consents that may be
withdrawn or made subject to limitations. There can be no assurance that they
will be granted or renewed or if so, on what terms. There is also the
possibility that the terms of any licence may be changed other than as
represented or expected.
The current jurisdictions of the Group's activities, offer stable political
frameworks and actively support foreign investment. These countries have
well-developed exploration and mining codes and proactively support foreign
companies. Through a programme of proactive engagement with each Government at
all levels, the Group seeks to partially mitigate these risks by establishing
professional working relationships.
Financial Risks
The Group's operations expose it to different financial risks including
foreign exchange risk, credit risk, liquidity risk and interest rate risk.
Details of the principal financial risks are set out in note 23.
To develop its extraction processes in South Africa and Australia, the Group
may require significant financial resources. These needs may arise from the
necessity to increase or expand mineral development activities, subject to
availability of capital on favourable terms.
Refer to note 2 to the consolidated and group financial statements which
explains that the Group is reliant on management's ability to secure
additional funding in order to meet its obligations as they become due. A
material uncertainty therefore exists that may cast significant doubt on the
Group's and Company's ability to continue as a going concern.
Furthermore, financial performance may be impacted by fluctuations in the
exchange rates between the US Dollar, South African Rand, Zambian Kwacha,
Australian Dollar and UK Pounds Sterling, particularly because the Group
operates in multiple currencies, but raises capital primarily in Sterling.
Human Capital Risks
The Group's operational success and strategic management are critically
dependent on the retention of skilled directors and senior management.
Difficulty in maintaining or recruiting such personnel poses significant risks
to operational continuity and the execution of strategic objectives.
Nevertheless, through programmes of incentivising staff, appropriate
succession planning, and good management these risks can be largely mitigated.
Exploration and Development Risks
The estimates of mineral resources and reserves involve significant
uncertainties. These estimations are based on historical geological data and
management's judgement, which may not always accurately predict actual mineral
deposits. Misjudgements or errors in these estimates could lead to
unanticipated variations in reserves, affecting the feasibility and
profitability of mining operations. Even if there are economically recoverable
deposits, delays in the construction and commissioning of mining projects or
other technical difficulties may make the deposits difficult to exploit. The
exploration and development of any project may be disrupted, damaged or
delayed by a variety of risks and hazards which are beyond the control of the
Group. These include (without limitation) geological, geotechnical and seismic
factors, environmental hazards, technical failures, adverse weather
conditions, acts of God and government regulations or delays.
Exploration is also subject to general industrial operating risks, such as
equipment failure, explosions, fires and industrial accidents, which may
result in potential delays or liabilities, loss of life, injury, environmental
damage, damage to or destruction of property and regulatory investigations.
The Group may also be liable for the mining activities of previous miners and
previous exploration works. Although the Group intends, itself or through its
operators, to maintain insurance in accordance with industry practice, no
assurance can be given that the Group or, the operator of an exploration
project, will be able to obtain insurance coverage at reasonable rates (or at
all), or that any coverage it obtains will be adequate and available to cover
any such claims. The Group may elect not to become insured because of high
premium costs or may incur a liability to third parties (in excess of any
insurance cover) arising from pollution or other damage or injury.
Environmental, Regulatory and Operational Safety Risks
Operations must adhere to strict environmental standards, which are subject to
changes and could become more stringent. Failure to comply can lead to
substantial fines and operational disruptions. Mining operations are exposed
to potential accidents and infrastructure failures. Any significant safety
incidents or infrastructural damages could lead to operational halts,
increased costs, and legal liabilities. While the Group believes that its
operations and future projects are currently, and will be, in substantial
compliance with all relevant material environmental and health and safety laws
and regulations, including relevant international standards, there can be no
assurance that new laws and regulations, or amendments to, or stringent
enforcement of, existing laws and regulations will not be introduced.
Nevertheless, the Group will continue to vigorously apply international
standards to the design and execution of any and all of its activities,
including engagement and consultation with local communities, and
non-governmental and Governmental organisations to ensure any impacts of
current and future activities are minimised and appropriately managed. The
Group has established a comprehensive suite of health, safety, environmental
and community policies which will underpin all future activities.
Digital Asset Treasury Policy Risks
The risks described below are not exhaustive. Post year end, the Company's
digital asset holdings are held through GemR Corporation Limited (the
"Treasury Subsidiary"), a company incorporated in Hong Kong and a wholly owned
subsidiary of GEMR.
Price Volatility and Market Risk
Bitcoin, Solana and Ethereum, the Treasury Subsidiary's initial cryptocurrency
targets, are subject to extreme and unpredictable price volatility. The value
of the Company's digital asset holdings may decline materially and rapidly,
including to zero, over short periods of time. Such volatility is driven by
factors outside the Company's, or the Treasury Subsidiary's, control,
including speculative trading activity, macroeconomic sentiment, regulatory
announcements in major jurisdictions, changes in market liquidity, and the
actions of large holders who may exert disproportionate influence over market
prices. Unlike traditional treasury assets such as cash, money market
instruments, or short-duration government securities, Bitcoin, Solana and
Ethereum generate no yield and provide no contractual right to a future cash
flow. The carrying value of the Company's digital asset holdings may therefore
fluctuate significantly between reporting dates, and between the date of this
annual report and any subsequent reporting period. Any material decline in the
value of these holdings would reduce the Company's net assets and could
adversely affect the Company's financial position, results of operations, and
the market price of its ordinary shares.
Regulatory and Legal Risk
The regulatory treatment of digital assets, including Bitcoin, Solana and
Ethereum, remains unsettled across all jurisdictions material to the Company's
operations, including the United Kingdom and Hong Kong.
United Kingdom: The Financial Conduct Authority (FCA) is actively expanding
its supervisory perimeter over crypto assets. Future regulation may require
the Company or the Treasury Subsidiary to obtain licences, register with
regulatory bodies, or change the structure, custody arrangements, or
composition of its digital asset holdings. The FCA's financial promotions
regime for crypto assets, in force since October 2023, and the anticipated
broader crypto asset regulatory framework under the Financial Services and
Markets Act 2023 may impose material compliance obligations on the Company.
Non-compliance, whether inadvertent or otherwise, could result in regulatory
sanction, reputational damage, or restrictions on the Company's ability to
continue operating its treasury policy. Further, the FCA informed all
Companies listed on the Main Market that the acquisition of cryptocurrencies
would be treated as the acquisition of assets and therefore subject to the
rules on Reverse Takeovers as set out under UKLR 7. Therefore, there is the
risk that if the Company has a significant holding of cryptocurrencies and
there is a significant value change in either the Company or, the assets that
the Company may have, the listing of its shares may be cancelled as a result.
Hong Kong: The Treasury Subsidiary is incorporated and operates under the laws
of Hong Kong. The Securities and Futures Commission (SFC) of Hong Kong has
introduced a licensing regime for virtual asset service providers (VASPs)
under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance
(AMLO), effective from June 2023. Whilst the Treasury Subsidiary is not
presently a VASP as defined, any change in the SFC's interpretation of its
regulatory perimeter, or any expansion of the licensing regime, may require
the Treasury Subsidiary to obtain regulatory approval, restructure its
operations, or cease holding digital assets in Hong Kong. Furthermore,
political and legal developments in Hong Kong may alter the regulatory
environment in a manner that is difficult to predict or manage.
Cross-border regulatory risk: The Company is subject to the risk that
regulatory changes in any one jurisdiction may have extraterritorial
consequences, requiring material changes to the treasury policy, custodial
arrangements, or corporate structure of the Treasury Subsidiary.
Custody and Security Risk
The Company's digital assets are held in custody in a cold storage wallet held
by the Treasury Subsidiary. Digital assets held in custody are subject to
risks that are qualitatively different from those associated with traditional
financial assets held at regulated banks or custodians. These include the risk
of theft, hacking, loss of private keys, insider fraud, and technical failures
at the custodian or in underlying blockchain infrastructure. Unlike deposits
held at a regulated bank, the Company's digital asset holdings are not
protected by the Financial Services Compensation Scheme (FSCS) or any
equivalent governmental guarantee scheme. If the Company's digital assets were
lost, stolen, or rendered inaccessible for any reason, recovery may be
impossible and the loss would be permanent and unrecoverable. Whilst the
Company has implemented controls in respect of custody security, there is no
assurance that such controls will prove effective against all threats. The
Directors draw shareholders' attention to the fact that the custody of digital
assets is an area of evolving best practice and that the Company's
arrangements may require ongoing review and enhancement.
Tax Risk
The tax treatment of digital assets in the United Kingdom and Hong Kong is
subject to uncertainty and ongoing development by the relevant tax
authorities.
United Kingdom: HMRC's published guidance treats Bitcoin, Solana and Ethereum
as capital assets for UK corporate tax purposes. Disposal of digital assets by
the Treasury Subsidiary, or transfers between Group entities, may trigger
taxable gains. The Company's ability to utilise losses arising from digital
asset disposals against other Group income may be restricted. Any future
change in HMRC's position on the classification, taxation, or transfer pricing
of intra-group digital asset arrangements could result in material tax
liabilities, penalties, or interest.
Hong Kong: The Treasury Subsidiary is subject to Hong Kong Profits Tax on
profits arising in or derived from Hong Kong. The characterisation of gains
and losses on digital asset holdings as capital or revenue in nature is a
question of fact and law that may be contested by the Inland Revenue
Department.
Transfer pricing and group structure: Transactions between GEMR and the
Treasury Subsidiary, including any funding arrangements, management fees, or
intra-Group asset transfers, must comply with arm's length transfer pricing
principles in both jurisdictions. Any failure to do so may result in tax
authority challenge and additional tax liability.
Liquidity Risk
Whilst Bitcoin, Solana and Ethereum are among the most liquid digital assets
by traded volume, liquidity in digital asset markets is not equivalent to that
available in major fiat currency markets or government bond markets. In
periods of market stress, bid-offer spreads on digital assets may widen
materially, and the Company may be unable to liquidate all or part of its
digital asset holdings at prices close to prevailing market prices. The
Company's digital asset holdings are intended to be held as long-term treasury
assets and are not immediately available to fund the Company's operating
activities without a liquidation event. If the Company was required to
liquidate digital assets at short notice to meet operational or other funding
needs, it may do so at a material discount to carrying value. Shareholders
should note that the Company's treasury policy does not guarantee that
sufficient liquidity will be available from digital asset holdings to meet the
Company's working capital requirements.
Concentration Risk
Post year end, the Company's digital asset holdings are concentrated in three
assets: Bitcoin, Solana and Ethereum. Whilst these represent three of the
largest digital assets by market capitalisation, concentration in a small
number of assets amplifies the potential adverse impact of price declines,
regulatory actions targeted at either asset, or adverse technical developments
specific to either the Bitcoin, or Solana or Ethereum blockchain protocols.
The Company does not hold a diversified portfolio of digital assets and does
not intend to hold stablecoins, tokenised securities, or other digital asset
classes as part of its current treasury policy.
Operational and Governance Risk
The implementation of the Company's digital asset treasury policy requires
specialised operational competencies that differ materially from those
required to manage a conventional corporate treasury. These include the
management of blockchain wallet infrastructure, custody security protocols,
counterparty due diligence on digital asset exchanges and custodians, and
real-time monitoring of digital asset valuations. The Company has sought to
address these requirements through the incorporation of a specific subsidiary
to handle crypto activities, full Board oversight of treasury activities and
the implementation of a comprehensive cryptocurrency policy. However, the
Company's management team has limited prior operational experience in managing
digital asset holdings at the corporate treasury level. Any failure of
operational controls, including errors in transaction execution, wallet
management, or counterparty selection, could result in permanent loss of
assets.
Reputational and Shareholder Perception Risk
The Company's decision to allocate a portion of its treasury to Bitcoin,
Solana and Ethereum may not be consistent with the investment mandates, ESG
policies, or risk tolerances of all current or prospective shareholders.
Certain institutional investors, particularly those subject to ESG-related
investment restrictions, may view digital asset holdings unfavourably due to
concerns regarding the energy consumption of proof-of-work blockchain networks
(relevant to Bitcoin) or the broader reputational associations of digital
asset markets. This may adversely affect the Company's ability to attract or
retain certain categories of institutional shareholder and could affect the
liquidity and market price of the Company's ordinary shares. The Company
acknowledges that its treasury policy represents a departure from conventional
corporate treasury practice and is committed to providing transparent
reporting on its digital asset holdings.
Technology and Protocol Risk
Bitcoin, Solana and Ethereum are open-source software protocols subject to
ongoing technical development. Whilst these protocols have established track
records of operational resilience, they are not immune to technological risk.
These risks include the discovery and exploitation of previously unknown
software vulnerabilities, the risk of a successful 51% attack on the networks
(more relevant to Bitcoin but a theoretical risk for all), protocol-level
changes that alter the economic or technical characteristics of the assets,
and the possibility that superior competing protocols could reduce the utility
and value of Bitcoin, Solana or Ethereum over time. In addition, Ethereum's
ongoing protocol development roadmap introduces execution risk: future
upgrades may introduce unforeseen consequences that affect the security,
utility, or value of Ethereum. The Company has no ability to influence or
control the development of protocols.
Other business risks
In addition to the current principal risks identified above, the Group's
business is subject to risks relating to the financial markets and commodity
markets. The buoyancy of both the aforementioned markets can affect the
ability of the Group to raise funds. The Group has identified certain risks
pertinent to its business including:
Strategic and Economic:
• Business environment changes
• Limited diversification
Operational:
• Difficulty in obtaining / maintaining / renewing licences /
approvals
Commercial:
• Failure to maximise value from its projects
• Loss of interest in key assets
• Regulatory, compliance and legal
Human Resources and Management:
• Failure to recruit and retain key personnel
• Human error or deliberate negative action
• Inadequate management processes
Financial:
• Restrictions in capital markets impacting available financial
resources
• Cost escalation and budget overruns
• Fraud and corruption
The Directors regularly monitor such risks, using information obtained or
developed from external and internal sources, and will take actions as
appropriate to mitigate these. Effective risk mitigation may be critical to
the Group in achieving its strategic objectives and protecting its assets,
personnel and reputation. The Group assesses its risk on an ongoing basis to
ensure it identifies key business risks and takes measures to mitigate these.
Other steps include regular Board review of the business, monthly management
reporting, financial operating procedures and antibribery management systems.
The Group reviews its business risks and management systems on a regular
basis.
Promotion of the Company for the benefit of the members as a whole
The Directors believe they have acted in the way most likely to promote the
success of the Company for the benefit of its members as a whole, as required
by s172 of the Companies Act 2006.
The requirements of s172 are for the Directors to:
· Consider the likely consequences of any decision in the
long term;
· Act fairly between members of the Group and Company;
· Maintain a reputation for high standards of business
conduct;
· Consider the interest of the Group and Company's
employees;
· Foster the Group and Company's relationships with
suppliers, customers and others; and
· Consider the impact of the Group and Company's operations
on the community and the environment.
The Group and Company has sought to act in a way that upholds these
principles. The Directors believe that the application of s172 requirements
can be demonstrated in relation to some of the key decisions made and actions
taken during the year.
Category How the Directors have engaged Impact of action
Shareholders and investors The Directors have communicated regularly with its shareholders and investors The Group and Company has received feedback from shareholders and is listed on
via public announcements. the Equity Shares (Transition) category and is trading on the Main Market of
the London Stock Exchange.
The Directors have also maintained the listing of the Company on the Equity
Shares (Transition) category of the London Stock Exchange. The Company, on behalf of the Group, raised fresh capital during the period
with which to run its operations and establish its cryptocurrency treasury
activities, demonstrating a strong relationship with investors and existing
shareholders, who participated in the fundraise.
Suppliers The Group and Company has focused on developing long term and mutually Relationships have been maintained with all suppliers in place at the
beneficial relationships with its suppliers through consistent communication, beginning of the period.
efficient use of their time, prompt payment and reasonable requests.
The Company also maintains strong Health and Safety policies on its
operational mine sites to ensure the wellbeing of all suppliers.
Employees Whilst the Group and Company is small, it makes sure that it works closely Meetings were held with staff to provide project updates and ongoing business
with its employees and Directors, keeping them all closely and regularly objectives.
informed of all developments.
The Company's one employee is in regular contact with the Board and the
Directors all communicate independently and via regular Board Meetings.
Employees of the Group's South African subsidiary are on-site and regularly
interact with senior management/directors - mainly Wessel Marais, Louis Swart
and Bernard Olivier. There are 22 employees at the South African subsidiary.
There is one director engaged in Australia - Michael Ast.
There are one resident director and two South African directors in Zambia and
no employees.
Environmental, social and governance ("ESG") The Directors acknowledge that the Group's business activities could affect No environmental or safety incidents were reported during the year.
the society and environment around it, and that it has an opportunity and an
implicit duty to ensure this impact is positive.
The Company has a fully remote set up, no UK physical locations, has under 500
employees and consumes less than 40,000 kwh of energy.
Government The Directors are aware of the importance of retaining close and strong The Group ensures that it is always operating within the parameters set by
working relationships with Government (both national and local) in the local laws, as evidenced by its maintained Zambian licence which is post year
jurisdictions that the Group operates in. end is under renewal, up to date filings in Australia and the deposit made for
mine site rehabilitation in RSA.
Local Community At the subsidiary level, management and the Group and Company's employees This created, and will continue to create, increased economic activity in the
continue to maintain excellent relationships with the local communities where areas in which the Company and Group operates. Local management also maintains
they operate. During the year under review, the Group and Company used local regular dialogue with the local population and leaders to ensure support for
businesses for the provision of certain services, specifically for geological its activities.
prospecting assistance, earth works, food and shelter.
The Company also fully complies with local Black Economic Empowerment ('BEE')
rules given the 26% shareholding of the BEE partners in the mining operations
in South Africa and maintains a strong relationship with its BEE partners.
Its members are kept informed, through detailed announcements, shareholder
meetings and financial communications, of the Board's broad and specific
intentions and the rationale for its decisions. The Company seeks to meet its
obligations in an orderly and timely manner, taking into account its working
capital position and keeps its costs to a minimum to protect shareholders'
funds.
Task Force on Climate-related Financial Disclosures (TCFD)
The Group recognises the importance of climate-related risks and opportunities
and is committed to providing disclosures aligned, where appropriate, with the
recommendations of the Task Force on Climate-related Financial Disclosures
("TCFD").
The Company is in the early stages of development and does not currently
consider climate-related risks to be material to its financial performance,
due to the early stage and limited scale of operations. However, the Board
acknowledges that climate-related factors will become increasingly relevant as
operations scale and is committed to enhancing its disclosures over time.
The Group intends to align its disclosures with the UK Sustainability
Reporting Standards (IFRS S1 and IFRS S2) as they become effective.
Governance
The Board has overall responsibility for the oversight of climate-related
risks and opportunities.
Climate-related considerations are incorporated into the Group's broader risk
management framework and are reviewed as part of the Board's regular
assessment of principal risks and uncertainties.
Given the size and stage of the Company, responsibility for assessing and
managing climate-related risks currently rests with the Board as a whole.
Strategy
The Group has considered climate-related risks and opportunities over the
short, medium and long term.
At its current stage of development, the Group's exposure is primarily
indirect and relates to:
• Regulatory risk, including potential changes to environmental and
mining legislation;
• Operational risk, including potential disruption from
weather-related events; and
• Stakeholder risk, including community and environmental
expectations.
The Group does not currently undertake formal climate scenario analysis, as
its operations are at an early stage and remain pre-scale. This will be
reviewed as projects advance.
Risk Management
Climate-related risks are considered as part of the Group's overall risk
management process.
The Board assesses whether climate-related risks are material to the Group's
operations and financial position and, where relevant, incorporates these into
the Group's principal risks and uncertainties.
At present, no climate-related risks have been identified as having a material
impact on the Group's financial statements.
Metrics and Targets
Due to the limited scale of the Group's operations during the year, the
Company has not established formal climate-related metrics or targets.
The Group does not currently measure Scope 1, Scope 2 or Scope 3 greenhouse
gas emissions, as its operational footprint remains limited and activities are
largely undertaken through third-party contractors.
The Board will review the appropriateness of introducing such metrics as
operations expand.
Use of financial instruments
The Company's financial risk management objectives are to minimise its
liabilities wherever possible (refer to note 23), to fund its activities
through equity or debt financing and to ensure the Company has sufficient
working capital to pursue its corporate strategic objectives.
Louis Ching
Executive Chairman
Date: 29 April 2026
Directors' Report
The Directors present their Directors' Report together with the audited
financial statements of Gem Resources Plc (the "Company" or "GEMR"). A
commentary on the business for the year is included in the Chairman's
Statement on page 5. A review of the business is also included in the
Strategic Report on page 7.
The shareholdings of the Directors and Key Management Personnel ("KMP") who
held office throughout the period and at the date of publication are as
follows:
At date of report 31 December 2025 31 December 2024
Name Number of Ordinary Shares Percentage of share capital Number of Ordinary Shares Percentage of share capital Number of Ordinary Shares Percentage of share capital
Louis Ching 308,658,089 50.00% 308,658,089 50.00% - -
Africa Critical Metals Limited(1) 60,000,000 9.72% 60,000,000 9.72% 60,000,000 19.44%
Edward Nealon(2) 15,347,434 2.49% 15,347,434 2.49% 10,680,768 3.46%
Peter Redmond 9,449,357 1.53% 9,449,357 1.53% 8,949,357 2.90%
Bernard Olivier 4,964,103 0.80% 4,964,103 0.80% 4,964,103 1.61%
Sam Mulligan 1,000,000 0.32% 1,000,000 0.32% 1,000,000 0.32%
Jeremy Sturgess-Smith 940,170 0.15% 940,170 0.15% 940,170 0.30%
(1) At the time of publication of the accounts, Edward Nealon holds 49.5% of
the issued share capital of Africa Critical Metals Limited ("ACM") through his
family investment company, Almaretta Pty Ltd. Mr Nealon is considered to be
interested, inter alia, in all the shares held by Africa Critical Metals
Limited in the proportions set out above. Mr Nealon is a director of ACM.
(2) Mr Nealon's interest in shares includes 5,384,615 shares held through his
family investment company, Almaretta Pty Ltd.
The Directors mitigate the risk to independence from the Chairman's large
shareholding through:
· decisions involving potential conflicts are considered by the
full board;
· independent director oversight is used where appropriate; and
· external legal advice is taken on material matters.
Results and dividends
The results for the year ended 31 December 2025 are set out on page 57.
The Group and Company restated prior year numbers following a review of the
accounting of historic acquisitions. For details of restatement please refer
to note 28.
The Group reports a loss of £0.9 million for the year ended 31 December 2025
(2024: £1.9 million as restated). The Company reports a loss of £0.7
million for the year ended 31 December 2025 (2024: £1.4 million as
restated).
The loss attributable to the owners of the parent was £846,000 (2024:
£1,728,000 as restated) and the loss attributable to non-controlling
interests was £70,000 (2024: £134,000 as restated), consistent with the
financial statements.
There were no dividends paid (2024: £nil) in the financial year ending 31
December 2025.
Directors' Insurance and Indemnity Provision
The Company maintains Directors' & Officers' liability insurance which
gives appropriate cover for any legal action brought against its Directors.
In accordance with Section 234 of the Companies Act 2006, qualifying third
party indemnity provisions are in place for the Directors in respect of
liabilities incurred as a result of their office to the extent permitted by
law.
Employment Policy
It is the policy of the Group and Company to operate a fair employment
policy. No employee or job applicant is less favourably treated than another
on the grounds of their sex, sexual orientation, age, marital status,
religion, race, nationality, ethnic or national origin, colour or disability
and all appointments and promotions are determined solely on merit. The
Directors encourage employees to be aware of all issues affecting the Group
and Company and place considerable emphasis on employees sharing in its
success.
Changes in share capital
Details of movements in share capital during the period are set out in note 19
to these consolidated financial statements.
Pensions
The Company did not operate a pension scheme during the period and has not
paid any contributions to any scheme for Directors and employees.
All eligible Directors and employees have been invited to participate in the
Company's pension scheme with True Potential. All Directors and employees
have opted out of the workplace pension.
Energy and Emissions Data
As the Company has not consumed more than 40,000 kwh of energy in this
reporting period, it qualifies as a low energy user under these regulations
and is not required to report on its emission, energy consumption or energy
efficiency activities. Additionally, during the reporting period, there were
no significant contracts in place that would affect the Energy or Emissions
Data.
Going concern
During the year ended 31 December 2025, the Group incurred a loss of £0.9
million (2024: £1.9 million as restated), the Company incurred a loss of
£0.7 million (2024: £1.4 million as restated) and experienced net cash
outflows from operating activities. Cash and cash equivalents for the Group
totalled £1,613,000 as at 31 December 2025 (2024: £414,000) and £129,000 as
at 31 December 2025 (2024: £283,000) for the Company.
The Group's consolidated financial statements and Company's financial
statements have been prepared on a going concern basis, which assumes that the
Group and Company will be able to realise its assets and discharge its
liabilities in the normal course of business for at least twelve months from
the date of approval of these financial statements.
Management has assessed the Group and Company's ability to continue as a going
concern in light of the current economic uncertainty following the recent
conflict in Iran. The geopolitical developments have led to increased
volatility in global financial markets, disruptions to certain supply chains,
and heightened uncertainty around investor sentiment toward certain asset
classes, including digital assets.
Post year end, the Group holds investments in cryptocurrencies. The value of
these holdings is subject to significant fluctuations due to market sentiment,
regulatory developments, and broader macroeconomic conditions. The conflict
and resulting regional tension have, at times, materially affected
cryptocurrency market valuations and liquidity. In conducting its assessment,
management has reviewed severe but plausible downside scenarios reflecting
potential further declines in crypto asset values and reductions in market
liquidity.
While these scenarios indicate that a material reduction in cryptocurrency
values could impact the Group and Company's net asset position, the Directors
have identified mitigating actions available to preserve liquidity, including
the potential reduction of discretionary expenditure, deferral of capital
programmes, and the selective disposal of non‑core assets. In September
2025, the Company issued Mr Louis Ching Convertible Loan Notes in the
principal amount of £1.5 million, convertible at a 50% premium to the
Subscription Price (equivalent to £0.003 per share (0.30 pence) (the
"Conversion Price")). The Convertible Loan Notes carry a 5% annual interest
and may be converted at any time up until 3 September 2028. In conjunction
with the issue of the Convertible Loan Note, the Company and its Directors
agreed that outstanding and accrued and unpaid Board and management fees,
totalling approximately £230,000 (gross), would be converted into Ordinary
Shares at the Conversion Price, showing the continued support from management.
After considering the above factors and the available mitigating actions, the
Directors have a reasonable expectation that the Group and Company will have
adequate resources to continue in operational existence for the foreseeable
future. Accordingly, the financial statements continue to be prepared on a
going concern basis.
Nevertheless, given the unpredictable nature of the geopolitical situation and
the inherent volatility of cryptocurrency markets, there remains a risk that
future events could have a material adverse impact on the Group and Company's
trading performance and financial position that may require the Group and
Company to raise additional working capital to advance its projects within the
12 months following the date of approval of these financial statements.
Management has successfully raised money in the past, but there is no
guarantee that adequate funds will be available when needed in the future.
These uncertainties represent a material uncertainty that may cast significant
doubt upon the Group and Company's ability to continue as a going concern.
The financial report does not include adjustments relating to the
recoverability and classification of recorded asset amounts or to the amounts
and classification of liabilities that might be necessary should the Group and
Company not continue as a going concern.
Directors' remuneration
Details of the remuneration of the Directors can be found in note 5 to these
consolidated financial statements.
Directors' interests in transactions
Other than disclosed in note 5 and 24 to the consolidated financial
statements, no Director had during, or at the end of the period, a material
interest in any contract which was significant in relation to the Company's
business.
Directors
The following Directors held office during the period:
Peter Redmond
John Treacy
Edward Nealon
Bernard Olivier
Sam Mulligan (resigned 18 June 2025)
Louis Ching (appointed 3 September 2025)
Hans Wong (appointed 3 September 2025)
Board Assessment
The Board recognises the importance of regular evaluation of its
effectiveness, composition and governance processes. Given the current size
and stage of development of the Company, no formal externally facilitated
board evaluation was undertaken during the year. Instead, board effectiveness
has continued to be kept under review by the Chairman and the Board as a
whole, with consideration given to the balance of skills, experience,
independence, succession planning and the evolving needs of the business. The
Board intends to keep the appropriateness of a more formal internal or
external evaluation process under review as the Company develops further. In
the meantime, the Directors consider that the existing informal review process
remains proportionate to the size and nature of the Group.
Internal controls and corporate governance
The Board is responsible for identifying and evaluating the major business
risks faced by the Company and for determining and monitoring the appropriate
course of action to manage these risks.
Environmental, Social and Governance ("ESG") Statement
GEMR is committed to operating its mining and exploration activities in a
responsible, ethical, and sustainable manner. While the Company is still in
the early stages of production, ESG considerations are incorporated into all
strategic and operational decisions as part of its long-term value creation
plan.
Environmental Stewardship
GEMR acknowledges the environmental sensitivity of gemstone mining. The
Company strives to:
· Minimise environmental impact through responsible land use and
rehabilitation planning;
· Monitor water and waste management at its project sites; and
· Ensure that future energy sourcing decisions incorporate
efficiency and sustainability considerations.
During 2024 and 2025, mining and processing activities were limited to
tailings and low-impact hard rock mining, which allowed the Company to
optimise recovery while minimising its operational footprint.
Social Responsibility
GEMR is committed to building enduring relationships with the local
communities in which it operates. Highlights include:
· 26% Black Economic Empowerment (BEE) ownership at the Gravelotte
operation, which includes participation by the local community;
· Local employment preference at Gravelotte, providing jobs and
skills development to the surrounding communities; and
· Ethical sourcing and full traceability of GEMR's emeralds,
contributing to consumer confidence.
Community consultation remains an ongoing part of the Company's site
development and expansion planning. The inclusion of local community
stakeholders in the BEE structure is a central part of GEMR's social licence
to operate and long-term development strategy.
Governance and Compliance
The Board of GEMR recognises that strong governance underpins its ability to
deliver on its strategic and ESG objectives. Key features include:
· Board oversight of ESG matters via the Audit Committee;
· Policies in place addressing anti-bribery and market disclosure;
and
· Compliance with the QCA Corporate Governance Code as applicable
to a standard listed company.
As the Company grows, it intends to enhance formal ESG reporting frameworks
and adopt metrics consistent with the International Sustainability Standards
Board (ISSB) and Sustainability Accounting Standards Board (SASB) guidance
where relevant.
Streamlined Energy and Carbon Reporting (SECR)
GEMR does not meet the size or activity thresholds that would trigger
mandatory disclosure under the UK Government's Streamlined Energy and Carbon
Reporting (SECR) framework.
However, the Company remains committed to operating responsibly and will
continue to monitor its environmental impact. As operations scale, GEMR will
review the implementation of energy use monitoring and voluntary emissions
reporting in line with recognised ESG reporting standards.
Whistleblowing
The Group has adopted a formal whistleblowing policy which aims to promote a
very open dialogue with all its employees which gives every opportunity for
employees to raise concerns about possible improprieties in financial
reporting or other matters.
To date, no reports have been filed under this policy.
Diversity
The Board is aware of its lack of diversity in its Board and senior
management. It has an all male Board. It therefore does not meet, either
during the year or at the current time, the board diversity targets as
detailed out in Policy Statement PS 22/3 of the Listing Rules and DTR
requirements, on gender and on ethnicity. The Board will continue to address
these issues going forward, however, the Board is conscious that the Group is
small, with only one employee, and the recruitment of a diverse Board in the
immediate future may not be feasible owing to the necessary expertise required
and prioritisation of reaching revenue generation.
Market Abuse Regulations
The Group is required to comply with article 18(2) of the Market Abuse
Regulation ("MAR") with reference to insider dealing and unlawful disclosure
of inside information. The LSE requires traded companies to maintain insider
lists as set out in the MAR. The Board has put in place a MAR compliance
process and the Company's regulatory announcements are overseen by the Board
of Directors.
Substantial shareholdings
As at 31 December 2025 and at the date of this report, the Directors are aware
that following shareholders hold more than 3% of the issued share capital:
Name Number of Ordinary Shares Percentage of share capital
Louis Ching 308,658,089 50.00%
Africa Critical Metals Limited 60,000,000 9.72%
Nortrust Nominees Limited 23,675,000 3.84%
The Bank of New York (nominees) Limited 19,123,806 3.10%
Number of shares not in public hands as at 31 December 2025 and at the date of
this report, are 399,359,153 which equates to 64.69% of issued share capital.
Subsequent events
Following the end of the reporting period, the Group and Company announced
that it has recorded its first purchase of cryptocurrency under its new
cryptocurrency treasury policy, further details of this and other subsequent
events are disclosed in note 26 of the consolidated financial statements.
Annual general meeting
This report and the consolidated financial statements will be presented to
shareholders for their approval at the Company's Annual General Meeting
("AGM"). The Notice of the AGM will be distributed to shareholders together
with the Annual Report.
Audit committee
The Audit Committee comprises Peter Redmond as Chair and John Treacy, and
meets at least twice a year. The Audit Committee is responsible for making
recommendations to the Board on the appointment of auditors and the audit fee
and for ensuring that the financial performance of the Company is properly
monitored and reported. In addition, the Audit Committee receives and reviews
reports from management and the auditors relating to the interim report, the
annual report and accounts and the internal control systems of the Company.
The audit committee met 3 times during the year to 31 December 2025.
Corporate Governance
The Board recognises its responsibility for the proper management of the
Company and is committed to maintaining a high standard of corporate
governance. The Directors recognise the importance of sound corporate
governance commensurate with the size and nature of the Company and the
interests of its Shareholders.
As a public company limited by shares, the Company has chosen to adopt the QCA
Code (2023) which contains a minimum standard of best practice corporate
governance for listed companies and for reporting corporate governance
matters.
QCA Corporate Governance Statement
GEMR is committed to good corporate governance and has adopted the corporate
governance guidelines of the Quoted Companies Alliance (QCA).
Principle 1: Establish a purpose, strategy and business model which promotes
long-term value for shareholders
At Gem Resources, our strategy is clear: to become a leading producer and
trusted supplier of ethically mined gemstones. We plan to achieve this
through:
· Expertise and Experience
Leveraging the extensive global gemstone mining experience and deep local
knowledge of our directors and team of seasoned professionals.
· Uncovering Lucrative Opportunities
Our wealth of experience at GEMR enables us to identify previously untapped
new gemstone deposits with significant potential. We also apply advanced
mining technologies and processing techniques, tools that maximise returns and
can make it feasible to extract gemstones from previously inaccessible or
economically unviable locations.
· A Commitment to Ethical Standards
We are dedicated to establishing ourselves as trustworthy producers and
developing an ethical route to market for the gemstones we unearth. We have,
and always will, strictly adhere to ethical mining practices, ensuring fair
treatment of workers, responsible sourcing, and minimal environmental impact.
Our commitment to ethical standards is integral to every aspect of our
operations.
· Strategic Decision-Making
We adopt a disciplined approach to project development, evaluating whether to
proceed with further development or to divest at opportune stages to maximize
shareholder value. Our decisions are guided by a commitment to enhancing
returns, ensuring long term value and minimising risk.
Risk factors relating to the Group are set out in the Company's annual report
and include: expansion risk, jurisdictional risk, competition, dependence on
management, scarcity of suitably qualified individuals, dependence on
licences, reliance on certain facilities, regulatory compliance and
environmental regulatory and risks. The Company's risk factors are reviewed
and updated by the CFO and the wider board annually.
Principle 2: Promote a corporate culture that is based on ethical values and
behaviours
The Company aims to operate ethically and be socially responsible in its
actions. It has established a number of policies to support this aim,
including:
· Anti-bribery
· Financial Reporting Procedures
· Modern slavery and human trafficking policy
· Share dealing code
· Whistleblowing policy
· Social Media policy
The Company policies are regularly reviewed and updated (if applicable) to
ensure they are still fit for purpose.
Principle 3: Seek to understand and meet shareholder needs and expectations
The Company is committed to building and maintaining strong relationships with
all of its shareholders.
The Company disseminates news on significant developments and regular
operational updates in stock exchange announcements via the Regulatory News
Service (RNS). These are also available on the website www.gemresources.co.uk.
The website contains a wealth of information for existing and potential
shareholders. Also, to accompany important Company announcements released via
the RNS news service, the Company will send out an alert email to the
subscribers to its distribution list (which is free of charge to anyone who
wishes to subscribe).
The Company's Annual General Meeting (AGM) is the main forum for discussing
matters with shareholders, addressing their queries, and understanding their
needs and expectations. The Company holds its AGM (and other General Meetings)
at a convenient time and location, normally in Central London, to ensure
shareholders have every chance to attend.
The Chief Executive Officer makes himself available to meet with investors
during the year and engages in regular dialogue with the Company's advisors
and retail investors to gauge shareholder sentiment, including via the
Company's X/Twitter page, by attending investor and sector specific in-person
events, through media outreach/interviews (e.g. Zak Mir, Proactive Investors)
and through the utilisation of the Investor Meet Company platform.
Principle 4: Take into account wider stakeholder interests, including social
and environmental responsibilities, and their implications for long-term
success
In addition to weekly project and operational team meetings, the Company also
shares key progress updates via email to all staff and releases public
announcements via the RNS service.
The Directors believe they have acted in the way most likely to promote the
success of the Company for the benefit of its members as a whole. Including:
· Considering the likely consequences of any decision in the long term;
· Acting fairly between members of the Company;
· Maintaining a reputation for high standards of business conduct;
· Considering the interest of the Company's employees;
· Fostering the Company's relationships with suppliers, customers and
others;
· Considering the consequences of any actions taken on the Company's
relationship with its partners;
· Considering the impact of the Company's operations on the community
and the environment.
The Company seeks to act in a way that upholds these principles and maintains
a regular dialogue with its external stakeholders to ensure these principles
are upheld.
GEMR is committed to operating its mining and exploration activities in a
responsible, ethical, and sustainable manner. While the Company is still in
the early stages of production, ESG considerations are incorporated into all
strategic and operational decisions as part of our long-term value creation
plan.
GEMR acknowledges the environmental sensitivity of gemstone mining. The
Company strives to:
· Minimise environmental impact through responsible land use and
rehabilitation planning;
· Monitor water and waste management at its project sites;
· Ensure that future energy sourcing decisions incorporate efficiency
and sustainability considerations.
Principle 5: Embed effective risk management, internal controls and assurance
activities, considering both opportunities and threats, throughout the
organisation
The Board has identified what it believes to be a sensible and robust approach
to opportunity and risk management for a Company of our size. Risks are
managed throughout the Group with regular reviews at functional, Audit
Committee and Board level.
Our risk management framework and processes are described in our Annual
Report.
Maintaining and evolving mechanisms for internal controls is a continuous
process both within the Company and at Board level. Risk and control-specific
forums report directly into the Audit Committee. Assurance activities,
including external reviews are conducted on a regular basis.
The Company receives feedback from our external auditors on the state of our
risk management and internal controls.
Principle 6: Maintain the board as a well-functioning, balanced team led by
the chair
The Board currently comprises two Executive Directors (Louis Ching and Bernard
Olivier), three Non-Executive Directors (Edward Nealon, Hans Wong and Peter
Redmond) and one Independent Non-Executive Director (John Treacy). Biographies
for each board member are available on pages 37 and 38 of this document.
The Company's Articles of Association clearly define the matters reserved for
the Board.
In addition, the Board has formed two sub-committees - the Audit Committee and
the Remuneration Committee which both have their own terms of reference.
The Audit Committee is comprised of the one Independent Non-Executive Director
(John Treacy) and one Non-Executive Director (Peter Redmond) who serves as
Chair. The remuneration committee is comprised of the same Independent
Non-Executive Director (John Treacy) who serves as Chair and Non-Executive
Director (Peter Redmond). The Board will also consider establishing such other
sub-committees where it believes such a committee would be beneficial.
The responsibilities of the Audit Committee include to:
· Monitor and review internal controls and risk management systems
· Oversee the relationship with the Auditor
· Consider and recommend to the Board the reappointment of the external
auditor
· Monitor and review the compliance, whistleblowing, and fraud
detection procedures
· Monitor and review reports from the Executive Directors, including
the Company's financial statements
The responsibilities of the Remuneration Committee include to:
· Monitor and review internal Board remuneration
· Set new remuneration arrangements, commensurate with the business
· Consider and recommend new equity option plans for the Directors and
employees of the Company
The Chairman, CEO and CFO all have specific roles and responsibilities which
are:
· Chairman (Louis Ching) - Chairing all Company Board meetings and
General Meetings, leading the Company's cryptocurrency and offtake plans;
· CEO (Bernard Olivier) - sets the overall operational and strategic
tone for the Company and wider Group; and
· CFO (Louis Swart) - runs the yearly audit and half-yearly interim
reports, is the main interface between the Company and its auditors, and
prepares monthly Board reports as per QCA Principle 1.
The Board periodically reviews independence of the Directors.
The Company holds regular Board meetings, at which monthly management
accounts, crypto holding statements, management reports and other
operationally pertinent documents are tabled and discussed. Feedback is
collated and fed back to the appropriate operational team members, ensuring
that the Company is always aware of its financial position and ensuring that
operations remain focused on the Company's key goals.
Board Meeting and sub-committee attendance is recorded by the Company
Secretary as well as any conflicts of interest.
The Board operates in a collaborative and constructive manner with a clear
focus on the delivery of strategy and increasing shareholder value.
All Directors will submit themselves for re-election at the Company's AGM.
Principle 7: Maintain appropriate governance structures and ensure that
individually and collectively the directors have the necessary up-to-date
experience, skills and capabilities
All the current directors are considered to provide a diverse range of
appropriate skills and experience. The Company provides, or will provide,
adequate support and training to ensure that the Directors remain
appropriately skilled and able to fulfil their duties to the required
standard, and regularly assesses the board composition and will look to
recruit in further skillsets as and when that may be required.
The corporate governance section of our Annual Report also details the roles
and responsibilities of the Board of Directors. These are drawn from a range
of backgrounds, enabling decision-making which draws upon extensive and varied
experiences.
The appropriateness of the Board's structures and processes will, when
appropriate, be reviewed through a formal Board evaluation and effectiveness
process led by the Chairman together with other Directors, and these will
evolve in parallel with the Company's objectives, strategy, business model and
our governance framework.
The diversity of the Board, succession planning and the contributions made by
various Directors are further detailed in the Corporate Governance section of
the Annual Report.
The Independent Non-Executive Director has experience of early-stage and
micro-cap, listed companies.
Relationship with Controlling Shareholder(s)
The Board is satisfied that the Company's existing governance and control
framework provides adequate assurance that the Company is capable of operating
independently of its Controlling Shareholder(s). In particular:
· A majority of the Board comprises Non-Executive Directors who are
independent of the Controlling Shareholder(s);
· The Audit Committee and Remuneration Committee are both chaired by
independent non-executive directors;
· These Committees operate under formally adopted terms of reference
consistent with the principles of the Quoted Companies Alliance (QCA)
Corporate Governance Code, and report directly to the Board; and
· The Board maintains oversight arrangements to ensure that all
shareholders are treated fairly and that the interests of minority
shareholders are properly safeguarded.
Accordingly, the Board believes that the Company's governance structure
satisfies the independence and oversight requirements and continues to promote
a transparent and balanced relationship between the Company and its
Controlling Shareholder(s).
Principle 8: Evaluate board performance based on clear and relevant
objectives, seeking continuous improvement
The Board is focused on implementing the Company's strategy. However, given
the current size and nature of GEMR, the Board does not consider it
appropriate, at this time, to have a formal performance evaluation procedure
in place, as described and recommended in Principle 7 of the QCA Code.
Therefore, the Company does not currently comply with this principle. The
Board does however, and as noted above, use the retirement by rotation of all
Directors at the Company's AGM as an opportunity to informally evaluate
individual Director performance.
The Board will closely monitor this situation as the Company grows.
Principle 9: Establish a remuneration policy which is supportive of long-term
value creation and the company's purpose, strategy and culture
Our Annual Report outlines the approach of our Remuneration Committee and
policies.
Principle 10: Communicate how the company is governed and is performing by
maintaining a dialogue with shareholders and other relevant stakeholders
The Company communicates with shareholders and other stakeholders through its
Annual and Interim Reports, regulatory and non-regulatory announcements, its
investor relations website, Annual General Meetings and face-to-face meetings.
More detail has been provided in Principle 1 above.
Political and charitable contributions
The Company made no charitable nor political donation in 2025 (2024: £nil).
Statement of Directors' responsibilities
The Directors are responsible for preparing the Strategic Report, the
Directors' Report, the Remuneration Report and the consolidated financial
statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each
financial year. Under that law, the directors are required to prepare
financial statements in accordance with UK adopted International accounting
standards ('UK-IAS'). Under Company Law, the directors must not approve the
financial statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and profit or loss of the Company
for that year. In preparing these financial statements, the directors are
required to:
• select suitable accounting policies and then apply
them consistently
• make judgements and accounting estimates that are
reasonable and prudent
• state whether applicable accounting standards, UK
adopted IAS have been followed, subject to any material departures disclosed
and explained in the financial statements
• prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the Company will continue in
business
• prepare a directors' reports, strategic report and
directors' remuneration report which comply with the requirements of the
Companies Act 2006.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that the financial statements and the Directors
remuneration report comply with the Companies Act 2006 and Article 4 of the
IAS Regulations. They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The Directors confirm that:
• so far as each Director is aware, there is no relevant
audit information of which the Company's auditor is unaware;
• the Directors have taken all steps that they ought to
have taken to make themselves aware of any relevant audit information and to
establish that the auditor is aware of that information; and
• the Directors are responsible for preparing the annual
report in accordance with applicable law and regulations. The Directors
consider the annual report and the financial statements, taken as a whole,
provides the information necessary to assess the Company's performance,
business model and strategy and is fair, balanced and understandable.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the United Kingdom governing the preparation and dissemination
of financial statements may differ from legislation in other jurisdictions.
Information to shareholders - Website
The Company has its own website (www.gemresources.co.uk) for the purposes of
improving information flow to shareholders as well as to potential investors.
Directors' Responsibilities Pursuant to DTR4
To the best of their knowledge, the Directors confirm:
• the Group and Company financial statements, prepared in
accordance with the applicable set of accounting standards, give a true and
fair view of the assets, liabilities, financial position of the Group and
Company and its loss as at 31 December 2025; and
• the annual report, including the Strategic Report
includes a fair review of the development and performance of the business and
the position of the Group and Company, together with a description of the
principal risks and uncertainties faced.
Statement of disclosures to auditor
So far as all the Directors, at the time of approval of their report, are
aware:
a) there is no relevant audit information of which the
Company's auditors are unaware; and
b) each Director has taken all the steps that they ought to
have taken as Directors in order to make themselves aware of any relevant
audit information and to establish that the Company's auditors are aware of
that information.
By order of the Board
Louis Ching
Executive Chairman
Date: 29 April 2026
Board of Directors
Louis Ching - Executive Chairman
Mr. Louis Ching is an experienced investor, entrepreneur, and corporate
executive with expertise in international markets, commodity trading, and
strategic financing. He has a strong track record in business development
across Asia and Africa and currently serves as Chairman and Managing Director
of PT International Development Corporation Limited, a company listed on the
Hong Kong Stock Exchange.
Edward Nealon - Non-Executive Director
Edward Nealon is a geologist with 48 years' experience in the mining and
exploration industry. After graduating in 1974, he commenced his career in
South Africa with Anglo American Corporation, before moving to Australia in
1980 where he spent two years in exploration with Rio Tinto. He founded his
own consulting company in 1983 and has practiced in most of the world's major
mining centres. Mr Nealon was co-founder and former Chairman of Aquarius
Platinum Ltd dual listed on AIM and ASX, co-founder of Sylvania Platinum Ltd
(AIM and ASX), co-founder of Tanzanite One (AIM). He holds a Masters degree
in Geology and is a member of the Australian Institute of Mining and
Metallurgy. Mr Nealon currently also serves as the Non-Executive Chairman for
Lexington Gold Ltd.
Bernard Olivier - Chief Executive Officer
Dr Bernard Olivier is a qualified geologist and has been involved with the
mining and exploration industry for the past 26 years. Dr Olivier has over 17
years' experience as a public company director of ASX-listed and AIM-quoted
mining and exploration companies. Dr Olivier was previously the CEO of
Richland (formerly Tanzanite One Limited) and was credited with restructuring
and returning the group to profitability in 2010. As CEO he also led the team
which established a maiden JORC Resource estimate of 3.9 million gold ounces
for Bezant Resources plc's Mankayan project and achieved an 8 pence per share
return of capital to its shareholders. Dr Olivier is a Member of the
Australasian Institute of Mining and Metallurgy (AusIMM). Dr Olivier currently
serves as a Director and Chief Executive Officer of Lexington Gold Ltd.
Peter Redmond - Non-Executive Director
Peter Redmond is a corporate financier with over 35 years' experience in
corporate finance and venture capital. He has acted on and assisted a wide
range of companies to attain a listing over many years on the Unlisted
Securities Market, the Main Market of the London Stock Exchange and AIM,
whether by IPO or in many cases via reverse takeovers, across a wide range of
sectors, ranging from technology through financial services to natural
resources and, in recent years has done so as a director of the companies
concerned. He was a founder director of Cleeve Capital plc (now BigBlu
Operations Limited) and Mithril Capital plc (now Be Heard Group Limited), both
formerly listed on AIM prior to takeovers, and took a leading role in the
reconstruction and refinancing of AIM-quoted 3Legs Resources plc (now SalvaRx
Group plc). He is also a director of Hemogenyx plc (where he was involved in
creating the precursor vehicle).
John Treacy - Independent Non-Executive Director
John Treacy is an experienced London-based financier who specialises in
working with growing companies. He qualified as a solicitor in the London
office of a major international law firm where he specialised in Capital
Markets and Mergers & Acquisitions. From there he moved on to practice
corporate finance in the advisory teams of several prominent UK brokerages
where he acted as an adviser to a number of AIM companies and advised on
numerous initial public offerings, acquisitions, debt restructurings and
placings.
Hans Wong - Non-Executive Director
Mr. Wong is a corporate finance and investment professional with over 30
years' experience in international capital markets. As an investor-operator,
he specializes in strategic capital deployment and business guidance across
multiple sectors. He has a diverse track record, including ventures in
fintech, entertainment, and hospitality, and brings extensive knowledge of
corporate restructuring and cross-border transactions.
Remuneration Report and Plan
Dear Shareholder,
On behalf of the Board, I am pleased to present our Remuneration Report. It
has been prepared in accordance with the requirements of The Large and
Medium-sized Companies and Groups (Accounts and Reports) (Amendment)
Regulations 2013 (the "Regulations") and, after this introductory letter, is
split into two areas: the Annual Report on Remuneration the Remuneration
Policy, in that order.
GEMR's shares were admitted to what is now the Equity Shares (Transition)
category and to trading on the Main Market of the London Stock Exchange on 2
March 2022. Since the listing, GEMR has been a mineral exploration and mining
company, operating in South Africa, Australia and Zambia. Post year end,
GEMR's digital assets are held by its Treasury Subsidiary, incorporated in
Hong Kong.
During the period, the Company has had seven Directors and one employee, who
are deemed KMP. We had stated in our 13 December 2023 prospectus that the
Directors and KMP will be paid annual amounts of:
· Edward Nealon - £40,000 per annum;
· Bernard Olivier - £50,000 per annum;
· Sam Mulligan - £40,000 per annum;
· Peter Redmond - £24,000 per annum;
· John Treacy - £24,000 per annum; and
· Jeremy Sturgess-Smith (employee) - £40,000 per
annum.
The remuneration to the following Directors was amended (while others'
remuneration remains the same) with effect from 1 May 2024 to:
· Edward Nealon - £45,000 per annum with a reduction
to £24,000 per annum from 1 September 2025;
· Bernard Olivier - £70,000 per annum; and
· Peter Redmond - £40,000 per annum.
Louis Ching and Hans Wong were appointed as Directors on 3 September 2025 and
are paid:
· Louis Ching - £100,000 per annum;
· Hans Wong - £24,000 per annum.
Wessel Marais and Louis Swart are directors at the South African entities and
are also deemed key management personnel and are paid:
· Wessel Marais - £61,510 per annum; and
· Louis Swart - £36,000 per annum.
No other remuneration has been paid to Directors. However, in order to
preserve cash, certain Directors and employee salaries were accrued and not
paid.
As was announced on 28 February 2025, the Company issued 5,999,998 new
ordinary shares of £0.0001 each ("Ordinary Shares") at an issue price of 0.65
pence per Ordinary Share to the directors, Bernard Olivier, Edward Nealon and
Peter Redmond in lieu of cash settlement of part of their accrued fees.
Refer to note 19.
At year end, the following amounts were outstanding to the
Directors/employee:
2025 2024
£ £
Peter Redmond 31,333 14,667
John Treacy 25,000 9,000
Edward Nealon 39,333 18,333
Bernard Olivier 57,750 32,083
Sam Mulligan(1) - 29,167
Louis Ching 32,576 -
Hans Wong 1,818 -
Jeremy Sturgess-Smith 31,667 21,667
Wessel Marais 32,310 35,711
Louis Swart 24,000 -
Total 275,787 160,628
(1) Resigned on 18 June 2025.
As was agreed on 20 November 2025, by resolution at a General Meeting, the
Company has the authority to issue 64,836,034 new ordinary shares of £0.0001
each ("Ordinary Shares") at an issue price of 0.3 pence per Ordinary Share to
certain directors and Key Management Personnel in lieu of cash settlement of
part of their accrued fees which had not yet been implemented as at the date
of this report.
On 1 September 2021, the Company adopted an unapproved share option plan,
which all executives and employees of the Company and its subsidiaries are
eligible to participate in. The Remuneration Committee has not granted any
further options beyond those detailed in the Remuneration Policy below;
however they will select individuals to whom any further share options are to
be granted from time to time.
Shareholders should note that the Company's Remuneration Policy contains
provisions that the Remuneration Committee be granted powers to set new
remuneration arrangements from time to time. As referred to above, the
Remuneration Committee implemented an option plan in 2021. An annual review
will be undertaken to ensure Remuneration is competitive and in line with
market practice and good governance. No arrangements other than the unapproved
option plan will be implemented for the Executive Directors or any other
Directors or employees until such a time as the Remuneration Committee may
feel it is appropriate. Any changes to the Remuneration Policy will be put to
shareholders at the next available Annual General Meeting.
John Treacy
Chairman of Remuneration Committee
Date: 29 April 2026
Remuneration Policy
As part of the current Remuneration Policy, the Remuneration Committee has
extensive discretionary powers to set new remuneration arrangements that are
commensurate with the business, from time to time. The Remuneration Committee
would expect to change salary levels of the existing Executive Directors, set
salaries and compensation and introduce benefits, pension, annual bonus and
long term incentive arrangements which are competitive and in line with market
practice and governance guidelines and which would be designed to align the
interests of shareholder growth and Director compensation. Salaries and fees
of all Directors were agreed following the admission of the Company's shares
to what is now the Equity Shares (Transition) category and to trading on the
Main Market of the London Stock Exchange on 2 March 2022, with an amendment
to Edward Nealon, Bernard Olivier and Peter Redmond's remuneration effective 1
May 2024. No further arrangements other than the unapproved option plan took
place for the existing Directors before 31 December 2025 (except for Edward
Nealon reduced to £24,000 per annum from 1 September 2025) but the
Remuneration Committee will keep the matter under review as the Company
develops.
Element Detail
Base salary Directors:
· Edward Nealon - £45,000 per annum with a reduction
to £24,000 per annum from 1 September 2025;
· Bernard Olivier - £70,000 per annum;
· Peter Redmond - £40,000 per annum;
· John Treacy - £24,000 per annum;
· Louis Ching - £100,000 per annum; and
· Hans Wong - £24,000 per annum.
Key Management Personnel:
· Jeremy Sturgess-Smith - £40,000 per annum;
· Wessel Marais - £61,510 per annum; and
· Louis Swart - £36,000 per annum.
At the end of the reporting period, a total of £275,787 (2024: £160,628) of
the above base salary remains unpaid and accrued.
Benefits No benefits are currently provided. A detailed review will be undertaken on
the 12-month anniversary of publication of these accounts.
Pension All eligible Directors and employees have been invited to participate in the
Company's pension scheme with True Potential. At the time of publication,
all eligible Directors and employees have opted out.
Annual Bonus No annual bonus scheme is intended to be implemented during 2025 or 2026. A
detailed review will be undertaken on the 12-month anniversary of publication
of these accounts. The review will reflect the scale and complexity of the
business at the time. Given the strategy of the Company, the Committee will
continue to monitor this throughout the period.
Option Plan The unapproved option plan put in place on Admission in March 2022 is intended
to support the delivery of the Company's strategy, to retain the Directors and
reward them for driving its successful delivery. At this stage, the Option
Plan is the Company's sole long-term incentive plan for current Directors and
employees following admission. The Option Plan operates over a period
commencing on admission to what is now the Equity Shares (Transition) category
and trading on the Main Market of the London Stock Exchange and ending on the
10(th) anniversary of this date (2 March 2032). For the full terms of the
Option Plan, please refer to the Company's prospectus published on its
website: https://gemresources.co.uk/publications/. All options are fully
vested.
At the time of publication, current participants are as follows:
Name Number of Options: Exercise Price: Date of Grant: Expiry Date:
Bernard Olivier 8,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
Peter Redmond 4,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
Jeremy Sturgess-Smith 8,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
In all cases the options vest in three equal tranches. The initial tranche,
equal to 25% of the total award, vested on 2 March 2022, at the Company's
initial listing on the Main Market of the London Stock Exchange, with an
exercise price of 2 pence per share; the second tranche, equal to 37.5% of
the total award, vested on 2 March 2023, on the first anniversary of the
Company's initial listing at an exercise price equal to 2.5 pence per share;
and the third tranche, equal to 37.5% of the total award, vests on 2 March
2024, the second anniversary of the Company's initial listing at an exercise
price of 2.7 pence per share.
As at 31 December 2025, none of the options have been exercised.
No other incentive plan is in place.
In all cases the options vest in three equal tranches. The initial tranche,
equal to 25% of the total award, vested on 2 March 2022, at the Company's
initial listing on the Main Market of the London Stock Exchange, with an
exercise price of 2 pence per share; the second tranche, equal to 37.5% of
the total award, vested on 2 March 2023, on the first anniversary of the
Company's initial listing at an exercise price equal to 2.5 pence per share;
and the third tranche, equal to 37.5% of the total award, vests on 2 March
2024, the second anniversary of the Company's initial listing at an exercise
price of 2.7 pence per share.
As at 31 December 2025, none of the options have been exercised.
No other incentive plan is in place.
Notice periods
The notice period for all Directors is 12 months' notice in writing.
Other Employees
Jeremy Sturgess-Smith is the Company's only employee. He also has a 12 month
notice period.
Other policy matters
Policy sections normally set out approaches in the areas of executive
recruitment, termination of employment, shareholder consultation,
consideration of employment conditions elsewhere in the Company and employee
consultation. Other than items explained above, the Company believes that
these issues are not applicable at present.
Annual Report on Remuneration
The Remuneration Committee presents its report for the year ended 31 December
2025.
The Remuneration Committee's main responsibilities
· The Remuneration Committee considers the remuneration
policy, employment terms and remuneration of the Board and advisers;
· The Remuneration Committee's role is advisory in nature,
and it makes recommendations to the Board on the overall remuneration
packages; and
· The Remuneration Committee, when considering the
remuneration packages of the Company's Board, will review the policies of
comparable companies in the industry.
The Remuneration Committee met once during the period to 31 December 2025.
Membership of the Remuneration Committee, meetings and Advisers
The Remuneration Committee is comprised of John Treacy as Chair and Peter
Redmond (both Non-Executive Directors). A meeting was held on 28 October 2025
and the Chairman of the Remuneration Committee presented an initial
recommendation to the Board.
The items included in this report are unaudited unless otherwise stated.
Report Approval
A resolution to approve this report will be proposed at the AGM of the
Company. The vote will have advisory status.
Directors' and Key Management Personnel ("KMP") emoluments and compensation
(audited)
Set out below are the emoluments of the Directors and KMP for the years ended
31 December 2025:
Salary and fees Loss of 2025
£ Office Total
£ £
Directors
Peter Redmond 40,000 - 40,000
John Treacy 24,000 - 24,000
Edward Nealon 39,750 - 39,750
Bernard Olivier 70,000 - 70,000
Sam Mulligan(1) (29,167)(1) 5,000 (24,167)
Louis Ching(2) 32,576 - 32,576
Hans Wong(2) 7,818 - 7,818
Total 184,977 5,000 189,977
KMP
Jeremy Sturgess-Smith 40,000 - 40,000
Wessel Marais 45,833 - 45,833
Louis Swart 36,000 - 36,000
Total 121,833 - 121,833
(1) Sam Mulligan resigned on 18 June 2025 and previous accrued fees reversed.
(2) Appointed 3 September 2025.
Set out below are the emoluments of the Directors and KMP for the years ended
31 December 2024:
Salary and fees Loss of 2024
£ Office Total
£ £
Directors
Peter Redmond 34,667 - 34,667
John Treacy 24,000 - 24,000
Edward Nealon 43,333 - 43,333
Bernard Olivier 63,333 - 63,333
Sam Mulligan 40,000 - 40,000
Total 205,333 - 205,333
KMP
Jeremy Sturgess-Smith 40,000 - 40,000
Wessel Marais 61,510 - 61,510
Louis Swart 15,000 - 15,000
Total 116,510 - 116,510
At the end of the reporting period, a total of £187,810 (2024: £103,250) of
the total Board remuneration and KMP salaries of £87,977 (2024: £57,377)
remain unpaid and accrued. Accrued and unpaid fees totalling £39,000 were
converted to Ordinary Shares (refer note 19 to the consolidated financial
statements) at a 31% premium, as was announced on 28 February 2025. A further
portion of accrued and unpaid fees totalling £194,508 was approved for
conversion to shares at a 50% premium on 20 November 2025.
Long term incentive plan arrangements
There is a charge of £nil (2024: £34,161) for Bernard Olivier, a charge of
£nil (2024: £17,081) for Peter Redmond and a charge of £nil (2024:
£34,161) for Jeremy Sturgess-Smith charged to the Comprehensive Income in the
year for the unapproved option plan.
Other disclosures on remuneration during 2025 and intention for 2026
Other than the salaries and fees detailed above in this Report, and the
Directors' and Employee option plan participation, no other remuneration was
paid, payable or is at present expected to be paid or payable for 2025. As
such, there are no further disclosures to be made in respect of salary or fee
changes for 2025, pension, benefits, annual bonus in respect of 2024 or 2025,
vesting, outstanding or forward long-term incentive plan awards. A payment of
£5,000 was made to Sam Mulligan for loss of office during the year ended 31
December 2025.
UK 10-year performance graph against CEO remuneration
The Directors have considered the requirement for a UK 10-year performance
graph comparing the Company's Total Shareholder Return with that of a
comparable indicator. The Directors do not currently consider that including
the graph will be meaningful because the Company is not paying dividends. The
Directors will continue to monitor the appropriateness or not of including a
graph for future annual reports.
Relative importance of spend on pay
The table below illustrates the year-on-year change in total remuneration
compared to distributions to shareholders and operational cash flow for the
financial periods ended 31 December 2025 and 2024:
Distribution to shareholders Total directors and employee pay Operational cash outflow
£'000 £'000 £'000
31 December 2025 Nil 312 781
31 December 2024 Nil 322 550
Total employee pay includes wages and salaries, social security costs and
pension costs for employees. Further details on employee remuneration are
provided in note 5 to the consolidated financial statements.
UK Remuneration percentage changes
Listed companies are required to make disclosures in respect of percentage
year-on-year changes in the lead executive's and employee remuneration, the
ratio of the lead executive's remuneration to that of different employee
groups. These disclosures are not applicable due to there being only one
employee.
Compliance with the QCA Governance Code
The Board is committed to maintaining high standards of corporate governance
and in this it is guided and complies with the QCA Corporate Governance Code.
As the Company develops and introduces a formal remuneration policy, the
Committee will reflect on these issues. The Committee is satisfied that, in
respect of 2025, the remuneration policy operated as intended in terms of
Company performance and quantum.
UK Directors' shares (audited)
The interests of the Directors who served during the year in the share capital
of the Company as of 31 December 2025 and at the date of this report has been
set out in the Directors' Report on page 23.
Policy Approval
A resolution to approve this policy will be proposed at the AGM of the
Company.
Approved on behalf of the Board of Directors by:
John Treacy
Chair of the Remuneration Committee
Date: 29 April 2026
Independent Auditors' Report
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GEM RESOURCES PLC
Opinion
We have audited the financial statements of Gem Resources plc (the 'parent
company') and its subsidiaries (the 'group') for the year ended 31 December
2025 which comprise the Consolidated Statement of Comprehensive Income, the
Consolidated and Company Statements of Financial Position, the Consolidated
and Company Statements of Changes in Equity, the Consolidated and Company
Statements of Cash Flows and notes to the financial statements, including
significant accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and UK-adopted
international accounting standards and as regards the parent company financial
statements, as applied in accordance with the provisions of the Companies Act
2006.
In our opinion:
· the financial statements give a true and fair view of the state of
the group's and of the parent company's affairs as at 31 December 2025 and of
the group's loss for the year then ended;
· the group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
· the parent company financial statements have been properly prepared
in accordance with UK-adopted international accounting standards and as
applied in accordance with the provisions of the Companies Act 2006; and
· the financial statements have been prepared in accordance with the
requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the
audit of the financial statements section of our report. We are independent of
the group and parent company in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the UK, including the
FRC's Ethical Standard as applied to listed public interest entities, and we
have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Material uncertainty related to going concern
We draw attention to Note 2 to the financial statements, which discloses that
the group and the parent company continue to incur losses and net cash
outflows from operating activities, and that there remains a risk that the
group and company may be required to raise additional working capital to
advance projects within the 12 months following the date of approval of these
financial statements. As disclosed in Note 2, these events or conditions,
along with other matters set forth in Note 2, indicate that a material
uncertainty exists that may cast significant doubt on the group's and parent
company's ability to continue as a going concern. Our opinion is not modified
in respect of this matter.
In auditing the financial statements, we concluded that the directors' use of
the going concern basis of accounting in the preparation of the financial
statements is appropriate. Our evaluation of the directors' assessment of the
group's and parent company's ability to continue to adopt the going concern
basis of accounting included:
· critically reviewing the cashflow forecasts and budgets prepared by
management for the 12 month period to 30 April 2027, corroborating and
providing challenge to key assumptions and inputs used;
· comparing forecast expenditures to current year actual results and
corroborating any significant variances;
· comparing historic forecasts to the actual results in the year to
assess the accuracy of the forecasting process; and
· reviewing post year-end bank statements and management information
to ascertain the group's and the parent company's cash position as at 31 March
2026 and post year-end performance, and comparing this to the forecasts.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Our application of materiality
The scope of our audit was influence by our application of materiality. The
thresholds for materiality determine the scope of our audit and the nature,
timing and extent of our audit procedures.
We determined materiality for the group and the parent company financial
statements to be:
Group Parent company
£ Basis £ Basis
Overall materiality 49,800 1.75% of total assets 24,900 1.75% of total assets, capped at 50% of group materiality
Performance materiality 29,850 60% of materiality 14,900 60% of materiality
Triviality 2,450 5% of materiality 1,240 5% of materiality
In determining group materiality, we considered total assets to be the most
appropriate benchmark. The group's mining assets, including exploration and
evaluation assets and mining development assets, represent the primary value
driver of the business and the principal source from which future revenues are
expected to be generated. Accordingly, these assets are a key area of focus
for users of the financial statements.
In determining the parent company materiality, we consider total assets to be
the primary measure used by the shareholders in assessing the performance. As
the parent company does not generate revenue, its primary balances consist of
investments in subsidiaries and receivables from group companies.
We use performance materiality to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements
exceeds overall materiality. Specifically, we use performance materiality in
determining the scope of our audit and the nature and extent of our testing of
account balances, classes of transactions and disclosures. We set the
performance materiality at 60% of the overall materiality for both the group
and the parent company.
In determining performance materiality, we considered the following factors:
· Our knowledge of the group and parent company and their
environment, including industry specific trends;
· Significant transactions during the year; and
· The level of judgement required in respect of the key accounting
estimates.
We agreed with the audit committee that we would report all individual audit
differences identified during the course of our audit in excess of £2,450 for
the group and £1,490 for the parent company together with any other audit
misstatements below these thresholds that we believe warranted reporting on
qualitative grounds.
Whilst performance materiality for the group was set at £29,850, we also
assessed performance materiality for in-scope entities. We identified five
components within the group, located in the United Kingdom, Zambia, Australia,
South Africa and Hong Kong. Full‑scope audits were performed on the UK
parent company by us as group auditor, and on the South African component by a
component auditor. For the Zambian, Australian and Hong Kong components, we
performed audit procedures on specific classes of transactions, account
balances or disclosures as part of our group audit. Aside from the parent
company, materiality for which is detailed above, these four components were
audited to a performance materiality ranging from £14,900 to £23,800,
representing an appropriate percentage of the group's performance materiality
according to their relative asset contribution and our assessment of inherent
risk. Therefore, we conclude that this approach provides sufficient coverage
to reduce the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality for the group financial statements as a
whole to an appropriately low level. The concept of materiality was applied
throughout the audit, from planning to execution, as well as in evaluating the
impact of misstatements.
Our approach to the audit
In designing our audit approach, we determined materiality and assessed the
risk of material misstatement in the financial statements. In particular, we
assessed the areas requiring the board and management to make subjective
judgements, for example in respect of significant accounting estimates
including the classification and valuation of mine development and stripping
activity, valuation of exploration and evaluation assets and with regard to
the parent company, valuation of investments and intercompany balances.
Audit work was performed on the financial information of the group's five
in-scope components, the scoping of which is detailed in the previous section.
One of the five components, South Africa, was audited by component auditor.
The group audit team provided detailed instructions to the component auditor
in respect of the scope of work to be performed, including the significant
audit areas and relevant risks identified, together with the required
reporting deliverables. The group audit team performed a review of the
component auditor's working papers in accordance with our group audit
approach. Ongoing communication was maintained with the component auditor
throughout the audit, and the required reporting packages and appendices were
received and reviewed to ensure compliance with our instructions.
The audit procedures on the other in‑scope entities, the parent company and
the group consolidation were performed in the United Kingdom by the group
audit team. In addition, the group audit team performed supplementary top-up
audit procedures in respect of the key audit matter relating to the valuation
of mine development costs and stripping activity, to complement and extend the
work performed by the component auditor.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were
of most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
In addition to the matter described in the Material uncertainty related to
going concern section of our report, we have determined the matters described
below to be the key audit matters to be communicated in our report.
Key Audit Matter How our scope addressed this matter
Classification and valuation of goodwill (Note 28)
In prior years, the group acquired controlling interests in Prasinus Our work in this area included the following:
Exploration Pty Ltd, Malaika Exploration (Ireland) Limited, and Gem Venus
Holdings (Pty) Ltd. These transactions were accounted for as business · Reviewing the historic accounting treatment of the group's
combinations in accordance with IFRS 3 Business Combinations. There is a risk acquisitions in prior years to assess whether the transactions were
that the acquisitions may not have been accounted for in full compliance with appropriately accounted for in accordance with IFRS, including evaluating
IFRS 3 and, consequently, that the classification and measurement of the whether the acquisitions were within the scope of IFRS 3 or should have been
resulting goodwill may not be appropriate. treated as asset acquisitions;
As a result of the judgement required by management in assessing the · Reviewing the share purchase agreements ('SPAs') for each entity
accounting treatment of these acquisitions, and due to the significant amount to understand the key terms including consideration transferred and assets
of time spent by the audit team in reviewing and concluding on these matters, acquired;
we have identified this as a key audit matter.
· Holding discussions with management surrounding the historical
acquisitions, including understanding the level of operations within the
acquiree companies and the nature of assets and liabilities acquired;
· Obtaining management's assessment of the accounting treatment of
each acquisition, and critically reviewing, providing challenge and
corroborating to SPAs;
· Reviewing appropriateness of the correcting accounting entries
relating to the acquisitions as at 1 January 2024 and 31 December 2024;
· Reviewing the purchase price allocation ('PPA') exercise
performed by management and reviewed by management's external expert,
assessing the methodologies applied, and consistency of conclusions with the
underlying transaction terms and applicable accounting standards;
· Assessing the competence, capabilities, and objectivity of the
external expert engaged by management in reviewing the PPA; and
· Reviewing the related financial statement disclosures.
Key observations
Based on our review, it was concluded by management that the historical
acquisitions of Prasinus Exploration Pty Ltd, Malaika Exploration (Ireland)
Limited, and Gem Venus Holdings (Pty) Ltd had been incorrectly accounted for
in prior periods.
The acquisitions of Prasinus Exploration Pty Ltd and Malaika Exploration
(Ireland) Limited were determined to be asset acquisitions rather than
business combinations. While the acquisition of Gem Venus Holdings (Pty) Ltd
met the definition of a business combination, no purchase price allocation was
performed at the time of acquisition.
As a result, amounts previously recognised as goodwill did not meet the
definition of goodwill under IFRS 3 and have been appropriately reclassified
in full to exploration and evaluation assets at their respective acquisition
dates.
Prior‑year adjustments have been recognised to correct the accounting
treatment as at 1 January 2024 and 31 December 2024.
Classification and capitalisation of mine development and stripping activity
(Note 7)
During the year, the group has generated revenues from trial production during Our work in this area included the following:
the year from its key asset, the Gravelotte Emerald Mine. Mine development and
stripping activity included within property, plant and equipment ('PPE') · Reviewing management's assessment of impairment in accordance
amounted to £243k as at 31 December 2025. with IAS 36 Impairment of Assets, including a review of net present value
calculations and challenging key assumptions used, including discount rates,
During the prior year, the group commenced operations at its Gravelotte forecast emerald prices, production levels and other significant inputs;
Emerald Mine and the related assets were reclassified from exploration and
evaluation assets to PPE as it was considered that technical and commercial · Verifying the mathematical accuracy of management's impairment
feasibility had been demonstrated. There is a risk that the transfer of assets models;
from exploration and evaluation stage to production assets may have been
performed incorrectly, resulting in potential misclassification. There is a · Obtaining the underlying Competent Person's Report ('CPR') in
further risk that, given revenues have been generated in the year, respect of the Gravelotte Emerald Mine and ensuring consistency with
depreciation should be recorded against these assets. management's impairment model, where applicable;
In addition, there is a risk that indicators of impairment exist in relation · Assessing the competence, capabilities and objectivity of
to the mining assets, as assessing recoverability requires significant management's expert in respect of the CPR;
judgement by management and the directors given the early stage of
development. · Evaluating management's rationale for the classification of such
assets within PPE, and for the absence of depletion given the stage of
As a result of this significant judgement, we have identified this area to be operations;
a key audit matter.
· Verifying physically a sample of production assets to supporting
documentation to confirm correct classification and existence, through site
visit performed by the component auditor; and
· Reviewing the related financial statement disclosures to ensure
compliance with IAS 36 and IAS 16 Property, Plant and Equipment.
Key observations
Based on the procedures performed, we did not identify any issues in respect
of the classification or valuation of the group's mine development and
stripping activity assets within PPE as at 31 December 2025.
Valuation of exploration and evaluation asset (Note 9)
The group holds material exploration and evaluation assets of £470k relating Our work in this area included the following:
to its Strategic Minerals Project in Zambia and the Curlew Mine in Australia.
• Testing a sample of additions to ensure costs have been
Given the early stage nature of these projects and the reliance on management capitalised in accordance with IFRS 6 Exploration for and Evaluation of
judgement in determining whether the group has the intention and ability to Mineral Resources;
continue exploration, as well as whether facts and circumstances exist that
would indicate impairment. The impairment assessment involves a higher degree • Obtaining confirmation that the group has good title to the
of estimation uncertainty. applicable licences;
In light of the level of estimation uncertainty and significant judgement • Obtaining any relevant technical reports prepared in relation to
required to be exercised by management, the valuation of exploration and the group's exploration projects;
evaluation assets has therefore been identified as a key audit matter.
• Reviewing publicly available information and board minutes to
ascertain the status of the projects and identify any potential impairment
indicators;
• Reviewing management's assessment of impairment and considering
whether there are any indicators of impairment as per IFRS 6. Providing
challenge to, and corroborating, key inputs and assumptions made in the
assessment;
• Where an impairment has been recorded during the year in respect
of one or more licenses, reviewing the circumstances leading to the impairment
and ensuring this has been recorded at an appropriate amount; and
• Reviewing disclosures in the financial statements to ensure that
they are complete and in accordance with IFRS 6.
Key observations
Based on the audit work performed, we do not consider the carrying value of
exploration and evaluation assets at the year-end to be materially misstated.
However, we draw attention to the disclosures made in the "Exploration and
evaluation assets" (Note 9) of the Annual Report in relation to the Group's
Zambian exploration licence, which has a carrying value of £276k as at 31
December 2025. The recoverability of this asset is dependent on the successful
renewal of the underlying licence. Should the renewal not be obtained for any
reason, this would result in an impairment of the related exploration and
evaluation asset.
Valuation of investments and intercompany balances - parent company
(Notes 3 and 4 to the parent company financial statements)
The parent company holds £755k of investments in subsidiaries and £2.6m of Our work in this area included the following:
receivables from group companies. These balances represent the most
significant assets on the parent company's statement of financial position. · Confirming ownership of investments;
There is a risk of material misstatement relating to the recoverability of · Obtaining management's impairment assessment relating to
these investments and intercompany receivables. The carrying value of the investments in subsidiaries, providing challenge and corroborating key inputs
investments is ultimately dependent on the value of the underlying assets held and assumptions made;
by the subsidiaries. The key assets within those entities are exploration and
development projects, for which determining an accurate valuation is · Reviewing the investment balances for indicators of impairment in
inherently challenging at the earlier stages of development. accordance with IAS 36;
Valuations of these assets rely heavily on judgements and estimates made by · Considering the appropriateness of the methodology applied by
the directors, increasing the risk of misstatement. Similar considerations management in their assessment of the recoverable amount of intragroup loans,
apply to the recoverability of loans to subsidiaries, where the subsidiaries' and the calculation of any expected credit loss provisions against these
ability to repay is directly linked to the value and future prospects of their balances, in accordance with the requirements of IFRS 9;
underlying projects.
· Evaluating the recoverability of investments and intragroup loans
Due to the subjective nature of these balances and the significant judgement by reference to underlying net asset values and exploration projects; and
involved in assessing their recoverability, we consider this area to be a key
audit matter. · Evaluating the presentation and disclosures in the financial
statements in accordance with IFRS.
Key observations
Based on the procedures performed, we identified that management had not
adequately considered the requirements of the expected credit loss model
within IFRS 9 in respect of intercompany receivables, which are undocumented
and therefore deemed repayable on demand.
As a result of this, management revisited the treatment, which resulted in
full provision against the intercompany receivables from Malaika Developments
Limited, Malaika Exploration (Ireland) Limited and Prasinus Explorations Pty
Ltd.
Other information
The other information comprises the information included in the annual report,
other than the financial statements and our auditor's report thereon. The
directors are responsible for the other information contained within the
annual report. Our opinion on the group and parent company financial
statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge
obtained in the course of the audit, or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a
material misstatement in the financial statements themselves. If, based on the
work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors' remuneration report to be audited
has been properly prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
· the information given in the strategic report and the directors'
report for the financial year for which the financial statements are prepared
is consistent with the financial statements; and
· the strategic report and the directors' report have been prepared
in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent
company and their environment obtained in the course of the audit, we have not
identified material misstatements in the strategic report or the directors'
report.
We have nothing to report in respect of the following matters in relation to
which the Companies Act 2006 requires us to report to you if, in our opinion:
· adequate accounting records have not been kept by the parent
company, or returns adequate for our audit have not been received from
branches not visited by us; or
· the parent company financial statements and the part of the
directors' remuneration report to be audited are not in agreement with the
accounting records and returns; or
· certain disclosures of directors' remuneration specified by law are
not made; or
· we have not received all the information and explanations we
require for our audit.
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities, the
directors are responsible for the preparation of the group and parent company
financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is necessary to
enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements, the directors
are responsible for assessing the group's and the parent company's ability to
continue as a going concern, disclosing, as applicable, matters related to
going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the group or the parent company or to
cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
· We obtained an understanding of the group and parent company and
the sector in which they operate to identify laws and regulations that could
reasonably be expected to have a direct effect on the financial statements. We
obtained our understanding in this regard through discussions with management
and component auditor, industry research, application of cumulative audit
knowledge and experience of the sector.
· We determined the principal laws and regulations relevant to the
group and parent company in this regard to be those arising from:
o Companies Act 2006;
o Listing Rules;
o Quoted Companies Alliance (QCA) Corporate Governance code;
o Disclosure Guidance and Transparency Rules;
o UK tax and employment law;
o Local mining and environmental regulations in South Africa, Zambia and
Australia; and
o Anti-bribery and money laundering regulations.
· We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by the group
and the parent company with those laws and regulations. These procedures
included, but were not limited to:
o Making enquiries of management;
o Reviewing legal and professional fees to understand the nature of the
costs and the existence of any non-compliance with laws and regulations; and
o Reviewing minutes of meetings of those charged with governance and
Regulatory News Service announcements.
· We also identified the risks of material misstatement of the
financial statements due to fraud. We considered, in addition to the
non-rebuttable presumption of a risk of fraud arising from management override
of controls, that the potential for management bias was identified in relation
to the classification and valuation of mine development and stripping
activity, valuation of exploration assets and valuation of investments and
intercompany balances. We addressed this by challenging the key assumptions
and judgements made by management in relation to this balance. The work
performed on this area is disclosed above within the Key audit matters section
of our report.
· As in all of our audits, we addressed the risk of fraud arising
from management override of controls by performing audit procedures which
included, but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; evaluating the business rationale
of any significant transactions that are unusual or outside the normal course
of business; and reviewing significant transactions in the banks statements to
identify potentially large or unusual transactions that do not appear to be in
line with our understanding of business operations.
· Our review of non-compliance with laws and regulations incorporated
the listed parent company and scoped in components where applicable based on
risk, including review of the component auditor's work in respect of the South
African component.
Because of the inherent limitations of an audit, there is a risk that we will
not detect all irregularities, including those leading to a material
misstatement in the financial statements or non-compliance with regulation.
This risk increases the more that compliance with a law or regulation is
removed from the events and transactions reflected in the financial
statements, as we will be less likely to become aware of instances of
non-compliance. The risk is also greater regarding irregularities occurring
due to fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor's report.
Other matters which we are required to address
We were appointed by the Board of Directors on 24 November 2025 to audit the
financial statements for the period ending 31 December 2025. Our total
uninterrupted period of engagement is one year, covering the period ending 31
December 2025.
The non-audit services prohibited by the FRC's Ethical Standard were not
provided to the group or the parent company and we remain independent of the
group and the parent company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit
committee.
Use of our report
This report is made solely to the company's members, as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the company's members those matters we
are required to state to them in an auditor's report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone, other than the company and the company's members as
a body, for our audit work, for this report, or for the opinions we have
formed.
Imogen Massey (Senior Statutory Auditor)
30 Churchill Place
For and on behalf of PKF Littlejohn
LLP
London
Statutory
Auditor
E14 5RE
Date: 29 April 2026
Consolidated Statement of Comprehensive Income
31 Dec 2025 31 Dec 2024
£'000s £'000s
Note Restated*
Continuing operations
Revenue 45 -
Cost of sales (271) -
Gross loss (226) -
Operating expenses 3 (729) (1,152)
Change in fair value of derivative asset 12 (18) 18
Change in fair value of contingent consideration 14 74 32
Impairment of exploration and evaluation assets 9 - (754)
Operating loss (899) (1,856)
Finance income 13 -
Finance cost (56) (6)
Loss before taxation (942) (1,862)
Taxation 4 8 -
Loss for the year (934) (1,862)
Attributable to:
Owners of the parent (864) (1,728)
Non-controlling interest (70) (134)
(934) (1,862)
Other comprehensive income
Loss for the year (934) (1,862)
Items that may be reclassified to profit or loss:
Exchange difference on translation of foreign operations 13 (66)
Total comprehensive loss for the year (921) (1,928)
Attributable to:
Owners of the parent (823) (1,772)
Non-controlling interest (98) (156)
(921) (1,928)
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. * For details of
restatement please refer to note 28.
Consolidated Statement of Comprehensive Income (continued)
31 Dec 2025 31 Dec 2024
Note Restated*
Earnings per share
Basic and diluted earnings per share (pence) 6 (0.21) (0.61)
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. * For details of
restatement please refer to note 28.
Consolidated Statement of Financial Position
Company number: 05329401 31 Dec 2025 31 Dec 2024 1 Jan 2024
£'000s £'000s £'000s
ASSETS Note Restated* Restated*
Non-current assets
Property, plant and equipment 7 370 402 31
Right of use asset 8 19 29 34
Derivative asset 12 - 18 -
Exploration and evaluation assets 9 470 462 1,176
Total non-current assets 859 911 1,241
Current assets
Inventories 10 38 9 -
Other receivables 11 30 101 239
Restricted cash 13 13 12 -
Cash and cash equivalents 1,613 414 674
Total current assets 1,694 536 913
Total assets 2,553 1,447 2,154
LIABILITIES
Non-current liabilities
Lease liabilities 8 (7) (19) (26)
Contingent consideration 14 (67) (141) (173)
Provisions 15 (40) (12) -
Convertible debt 18 (1,337) - -
Deferred tax liability 16 - (8) -
Total non-current liabilities (1,451) (180) (199)
Current liabilities
Trade and other payables 17 (456) (488) (81)
Lease liabilities 8 (12) (10) (9)
Total current liabilities (468) (498) (90)
Total liabilities (1,919) (678) (289)
NET ASSETS 634 769 1,865
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. * For details of
restatement please refer to note 28.
Consolidated Statement of Financial Position (continued)
Note 31 Dec 2025 31 Dec 2024 1 Jan 2024
£'000s £'000s £'000s
EQUITY Restated* Restated*
Share capital 19 62 30 25
Share premium 19 5,264 4,690 3,980
Share option reserve 20 227 227 142
Share warrant reserve 20 60 262 250
Equity component of convertible notes 20 180 - -
Currency translation reserve 20 (104) (145) (101)
Accumulated deficit (4,752) (4,090) (2,362)
Total equity attributable to equity owners of the parent 937 974 1,934
Non-controlling interest (303) (205) (69)
TOTAL EQUITY 634 769 1,865
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. * For details of
restatement please refer to note 28.
These consolidated financial statements were approved and authorised for issue
by the Board of Directors on 29 April 2026 and signed on its behalf by:
Louis Ching
Executive Chairman
Consolidated Statement of Changes in Equity
Share Share Share Share warrant reserve Equity component of convertible notes Currency translation reserve Accumulated Non-controlling interest Total
capital premium option deficit equity
reserve
£'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s
Balance at 1 January 2024 25 3,980 142 250 - (101) (2,362) (69) 1,865
Loss for the period (restated*) - - - - - - (1,728) (134) (1,862)
Other comprehensive income - - - - - (44) - (22) (66)
Total comprehensive income (restated*) - - - - - (44) (1,728) (156) (1,928)
Net equity issued 5 722 - - - - - - 727
Share warrant reserve - (12) - 12 - - - - -
Share option reserve - - 85 - - - - - 85
Acquisition of subsidiary - - - - - - - 20 20
Balance at 31 30 4,690 227 262 - (145) (4,090) (205) 769
December 2024 (restated*)
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. Refer to note 20 for
a description of reserves. * For details of restatement please refer to note
28.
Consolidated Statement of Changes in Equity (continued)
Share Share Share Share warrant reserve Equity component of convertible notes Currency translation reserve Accumulated Non-controlling interest Total
capital premium option deficit equity
reserve
£'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s
Balance at 1 30 4,690 227 262 - (145) (4,090) (205) 769
January 2025 (restated)*
Loss for the period - - - - - - (864) (70) (934)
Other comprehensive income - - - - - 41 - (28) 13
Total comprehensive income - - - - - 94 (864) (98) (921)
Net equity issued 32 574 - - - - - - 606
Lapsed warrants - - - (202) - - 202 - -
Issue of convertible loan notes - - - - 180 - - - 180
Balance at 31 62 5,264 227 60 180 (104) (4,752) (303) 634
December 2025
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. Refer to note 20 for
a description of reserves. * For details of restatement please refer to note
28.
Consolidated Statement of Cash Flows
Note 31 Dec 2025 31 Dec 2024
£'000s £'000s
Cash flows from operating activities Restated*
Loss for the period before taxation (942) (1,862)
Adjustments for:
Finance costs 43 6
Change in fair value of derivative asset 18 (18)
Change in fair value of contingent consideration (74) (32)
Amortisation/depreciation and impairment 87 799
Share based payment charge - 85
Foreign exchange 37 -
Increase in inventories 10 (29) (9)
Decrease in receivables 11 71 85
Increase in payables 17 8 396
Net cash used in operating activities (781) (550)
Cash flows from investing activities
Purchase of property plant and equipment 7 - (125)
Purchase of intangible asset 9 (3) (58)
Acquisition of subsidiary, net of cash acquired 27 - (232)
Interest received 13 -
Net cash from / (used) in investing activities 10 (415)
Cash flows from financing activities
Issue of shares for cash, net of costs 19 567 727
Proceeds from issue of convertible loan notes 18 1,500 -
Finance costs (39) (6)
Finance lease payments (10) (12)
Net cash from financing activities 2,018 709
Net increase / (decrease) in cash and cash equivalents 1,247 (256)
Foreign exchange translation differences (48) (4)
Cash and cash equivalents at beginning of the year 414 674
Cash and cash equivalents at the end of the year 1,613 414
The notes to these consolidated financial statements on pages 64 to 98 form an
integral part of these consolidated financial statements. * For details of
restatement please refer to note 28.
Notes to the Consolidated Financial Statements
1. General information
Gem Resources Plc ("the Company" or "GEMR") is domiciled in England and Wales
having been incorporated on 11 January 2005 under the Companies Act with
registered number 05329401 as a public company limited by shares. On 2 March
2022, the Company's shares were admitted to what is now the Equity Shares
(Transition) category and to trading on the Main Market of the London Stock
Exchange. The Company changed its name from URA Holdings Plc to Gem Resources
Plc on 30 September 2024.
The principal accounting policies applied in the preparation of these
consolidated and company financial statements are set out below. These
policies have been applied to all years presented, unless otherwise stated
below.
In the opinion of the Directors the consolidated financial statements present
fairly the financial position, and results from operations and cash flows for
the period in conformity with the generally accepted accounting principles
consistently applied.
2. Accounting policies
The consolidated financial statements have been prepared in accordance with
UK-adopted international accounting standards ('UK-IAS').
Basis of preparation
The consolidated and company financial statements are prepared on the going
concern basis, under the historical cost convention as modified for fair value
accounting, if applicable. The consolidated financial statements are presented
in Pounds Sterling and have been rounded to the nearest £'000.
The functional currency for each entity in the Group is determined as the
currency of the primary economic environment in which it operates. The
functional currency of the parent company is Pounds Sterling (£) as this is
the currency that finance is raised in. The functional currency of its South
African subsidiary is South African Rands (ZAR) as this is the currency that
mainly influences labour, material and other costs of providing services. The
functional currency of its Zambian subsidiary is Zambian Kwacha, being the
currency in which the majority of the Zambian company's transactions are
denominated. The functional currency of its Australian subsidiary is
Australian Dollars, being the currency in which the majority of the company's
transactions are denominated. The Group has chosen to present its consolidated
financial statements in Pounds Sterling (£), as the Directors believe it is
the most relevant presentational currency for users of the consolidated
financial statements. All values are rounded to the nearest thousand pounds
(£'000) unless otherwise stated. Foreign operations are included in
accordance with the policies set out below.
The preparation of financial statements requires the use of certain critical
accounting estimates. It also requires management to exercise its judgement in
the process of applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the financial information are disclosed at the
end of note 2.
Going concern
During the year ended 31 December 2025, the Group incurred a loss of £0.9
million (2024: £1.9 million), the Company incurred a loss of £0.7 million
(2024: £1.4 million) and experienced net cash outflows from operating
activities. Cash and cash equivalents for the Group totalled £1,613,000 as at
31 December 2025 (2024: £414,000) and £129,000 as at 31 December 2025 (2024:
£283,000) for the Company.
The Group's consolidated financial statements and Company's financial
statements have been prepared on a going concern basis, which assumes that the
Group and Company will be able to realise its assets and discharge its
liabilities in the normal course of business for at least twelve months from
the date of approval of these financial statements.
Management has assessed the Group and Company's ability to continue as a going
concern in light of the current economic uncertainty following the recent
conflict in Iran. The geopolitical developments have led to increased
volatility in global financial markets, disruptions to certain supply chains,
and heightened uncertainty around investor sentiment toward certain asset
classes, including digital assets.
Post year end, the Group holds investments in cryptocurrencies. The value of
these holdings is subject to significant fluctuations due to market sentiment,
regulatory developments, and broader macroeconomic conditions. The conflict
and resulting regional tension have, at times, materially affected
cryptocurrency market valuations and liquidity. In conducting its assessment,
management has reviewed severe but plausible downside scenarios reflecting
potential further declines in crypto asset values and reductions in market
liquidity.
While these scenarios indicate that a material reduction in cryptocurrency
values could impact the Group and Company's net asset position, the Directors
have identified mitigating actions available to preserve liquidity, including
the potential reduction of discretionary expenditure, deferral of capital
programmes, and the selective disposal of non‑core assets. In September
2025, the Company has issued Mr Louis Ching Convertible Loan Notes in the
principal amount of £1.5 million, convertible at a 50% premium to the
Subscription Price (equivalent to £0.003 per share (0.30 pence) (the
"Conversion Price")). The Convertible Loan Notes carry a 5% annual interest
and may be converted at any time up until 3 September 2028. In conjunction
with the issue of Convertible Loan Note, the Company and its Directors have
agreed that outstanding and accrued and unpaid Board and management fees,
totalling approximately £230,000 (gross), would be converted into Ordinary
Shares at the Conversion Price, showing the continued support from its
management.
After considering the above factors, and the available mitigating actions, the
Directors have a reasonable expectation that the Group and Company will have
adequate resources to continue in operational existence for the foreseeable
future. Accordingly, the financial statements continue to be prepared on a
going concern basis.
Nevertheless, given the unpredictable nature of the geopolitical situation and
the inherent volatility of cryptocurrency markets, there remains a risk that
future events could have a material adverse impact on the Group and Company's
trading performance and financial position that may require the Group and
Company to raise additional working capital to advance its projects within the
12 months following the date of approval of these financial statements.
Management has successfully raised money in the past, but there is no
guarantee that adequate funds will be available when needed in the future.
These uncertainties represent a material uncertainty that may cast significant
doubt upon the Group and Company's ability to continue as a going concern.
The financial report does not include adjustments relating to the
recoverability and classification of recorded asset amounts or to the amounts
and classification of liabilities that might be necessary should the Group and
Company not continue as a going concern.
Cash and cash equivalents
Cash and cash equivalents are carried in the consolidated statement of
financial position at cost and comprise cash in hand, cash at bank, deposits
held at call with banks, other short-term highly liquid investments with
original maturities of three months or less. Bank overdrafts are included
within borrowings in current liabilities on the consolidated statement of
financial position. For the purposes of the statement of cash flows, cash and
cash equivalents also includes any bank overdrafts.
Property plant and equipment
Property, plant, equipment and mine development includes buildings and
infrastructure, machinery, plant and equipment, site preparation and
development that are expected to be used during more than one period.
Assets that are in the process of being constructed are measured at cost less
accumulated impairment and are not depreciated. All other classes of property,
plant and equipment are stated at historical cost less accumulated
depreciation and accumulated impairment.
Direct costs incurred on major projects during the period of development are
capitalised. Subsequent expenditure on property, plant and equipment is
capitalised only when the expenditure enhances the value or output of the
asset beyond original expectations, it is probable that future economic
benefits associated with the item will flow to the entity and the cost of the
item can be measured reliably. Costs incurred on repairing and maintaining
assets are recognised in the income statement in the period in which they are
incurred.
Gains and losses on disposals are determined by comparing proceeds with
carrying amount. These are included in profit or loss.
Depreciation is charged to profit or loss so as to allocate the cost of assets
less their residual values over their estimated useful lives, using the
straight-line method or unit of production method. The following useful lives
are used for the depreciation of property, plant and equipment:
Item Depreciation method Average useful life
Furniture and fittings Straight line 6
Vehicles Straight line 5
Plant and equipment Straight line 6
Mine Development and Stripping Activity Unit of production Life of Mine*
* Depreciation of mining assets is computed principally by the
unit-of-production method over life-of-identified ore based on estimated
quantities of recoverable inferred resources, which can be recovered in future
from known mineral deposits.
Development begins once the technical feasibility and commercial viability of
extracting mineral resources have been established. At this stage,
expenditures incurred to bring the property to commercial production are
classified as development costs and depreciated on a unit-of-production method
as referred to above. These costs include activities such as constructing haul
roads, removing overburden, and building facilities necessary for extraction
and treatment.
The costs of stripping activity which provides a benefit in the form of
improved access to ore is capitalised as a non-current asset.
Intangible assets - Exploration and evaluation assets
All costs incurred prior to obtaining the legal right to undertake exploration
and evaluation activities on a project are written off as incurred. Following
the granting of a prospecting right, general administration and overhead costs
directly attributable to exploration and evaluation activities are expensed
and all other costs are capitalised and recorded at cost on initial
recognition. As the capitalised exploration and evaluation expenditure asset
is not available for use, it is not depreciated.
The following expenditures are included in the initial and subsequent
measurement of the exploration and evaluation assets:
· Acquisition of rights to explore;
· Topographical, geological, geochemical or geographical studies;
· Exploratory drilling;
· Trenching;
· Sampling;
· Activities in relation to the evaluation of both the technical
feasibility and the commercial viability of extracting minerals;
· Exploration staff related costs; and
· Equipment and infrastructure.
Exploration and evaluation costs that have been capitalised are classified as
either tangible or intangible according to the nature of the assets acquired
and this classification is consistently applied.
If commercial reserves are developed, the related deferred exploration and
evaluation costs are then reclassified as development and production assets
within property, plant and equipment.
All capitalised exploration and evaluation expenditure is monitored for
indications of impairment in accordance with IFRS 6.
Taxation
Current income tax assets and liabilities for the current period are measured
at the amount expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted, at the reporting date, in the
countries where the Group operates.
Deferred tax is accounted for using the liability method in respect of
temporary differences arising from differences between the carrying amount of
assets and liabilities in the Financial Statements and the corresponding tax
bases used in the computation of taxable profit or loss. In principle,
deferred tax liabilities are recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary
differences can be utilised.
The Group has losses to be carried forward on which no deferred tax asset is
recognised due to the uncertainty as to the timing of profit.
Financial instruments
Classification and measurement
The Group classifies its financial instruments into the following
categories:
· Financial assets measured at amortised cost;
· Financial assets measured at fair value through profit and loss;
· Financial liabilities measured at amortised cost; and
· Derivative financial instruments are accounted for at fair value
through profit and loss.
Classification of financial assets depends on the business model for
managing the financial assets and the contractual terms of the cash flows.
Management determines the classification of financial assets at initial
recognition. Generally, the Group does not acquire financial assets for the
purpose of selling in the short term. The Group's business model is primarily
that of "hold to collect" (where assets are held in order to collect
contractual cash flows).
Financial assets held at amortised cost
This classification applies to debt instruments which are held under a hold
to collect business model and which have cash flows that meet the "solely
payments of principal and interest" ("SPPI") criteria.
At initial recognition, trade and other receivables that do not have a
significant financing component are recognised at their transaction price.
Other financial assets are initially recognised at fair value plus related
transaction costs. They are subsequently measured at amortised cost using the
effective interest method. Any gain or loss on de-recognition or modification
of a financial asset held at amortised cost is recognised in the income
statement.
Financial assets and liabilities held at fair value through profit or loss
Financial assets and liabilities at fair value through profit or loss are
carried in the statement of financial position at fair value with net changes
in fair value recognised in the statement of profit or loss. Assets and
liabilities in this category are classified as current if they are expected to
be settled within twelve months, otherwise they are classified as non-current.
Impairment of financial assets
A forward-looking expected credit loss ("ECL") review is required for debt
instruments measured at amortised cost or held at fair value through other
comprehensive income, financial guarantees not measured at fair value through
profit or loss and other receivables that give rise to an unconditional right
to consideration.
As permitted by IFRS 9, the Group applies the "simplified approach" to trade
receivables, contract assets and lease receivables and the "general approach"
to all other financial assets. The general approach incorporates a review for
any significant increase in counterparty credit risk since inception. The ECL
reviews include assumptions about the risk of default and expected loss rates.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other
short-term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of changes in value.
These are classified as financial assets at amortised cost.
Trade and other payables
Trade and other payables are classified as financial liabilities at
amortised cost.
Derivative asset
The Group entered into a contractual arrangement that provides it with the
right, but not an obligation, to acquire additional ownership interest in an
existing subsidiary from a non-controlling shareholder. The Group accounts
for the arrangement as a derivative asset measured at fair value with changes
in fair value at each reporting date recognised in profit or loss.
Investments
Investments are recognised at cost less impairment.
Compound financial instruments
Compound financial instruments issued by the Group comprise convertible notes
that can be converted to ordinary shares at the option of the holder, when the
number of shares to be issued is fixed and does not vary with changes in fair
value.
The liability component of compound financial instruments is initially
recognised at the fair value of a similar liability that does not have an
equity conversion option. The equity component is initially recognised at the
difference between the fair value of the compound financial instrument as a
whole and the fair value of the liability component. Any directly attributable
transaction costs are allocated to the liability and equity components in
proportion to their initial carrying amounts.
Subsequent to initial recognition, the liability component of a compound
financial instrument is measured at amortised cost using the effective
interest method. The equity component of a compound financial instrument is
not remeasured.
Interest related to the financial liability is recognised in profit or loss.
On conversion at any time up to 3 September 2028 or at maturity, the financial
liability is reclassified to equity and no gain or loss is recognised.
Share capital
Ordinary shares are classified as equity. Incremental costs directly
attributable to the increase of new shares or options are shown in equity as a
deduction from the proceeds.
Share based payments
The Company enters equity-settled share-based compensation plans with its
Directors and contractors, in which the counterparty provides services to the
Company in exchange for remuneration in the form of certain equity instruments
of the Company. The equity instruments comprise warrants and share options.
The services received by the Company in these share-based payment agreements
are measured by reference to the fair value of the equity instruments at the
date of grant and are recognised as an expense in the statement of total
comprehensive income with a corresponding increase in equity. The Company
estimates the fair value of the equity instruments at the grant date using the
Black Scholes model in which the terms and conditions upon which those equity
instruments were granted are considered. Share options exercised are allocated
to share capital or when lapsed are derecognised at that point in time against
retained earnings.
Warrants
Warrants issued are recognised at fair value at the date of grant. The fair
value is measured using the Black-Scholes model. Where warrants are issued in
respect of services rendered, the fair value is expensed over the vesting
period (if applicable). Where warrants are considered to represent a
transaction cost attributable to a liability recorded at amortised cost, the
fair value is deducted from the liability and amortised subsequently through
the effective interest rate. Where a fixed number of warrants are issued and
the exercise price is in functional currency of the issuer the warrant fair
value is credited to equity.
Foreign currency and foreign exchange reserves
In preparing the financial statements of the Group entities, transactions in
currencies other than the entity's functional currency (foreign currencies)
are recognised at the rates of exchange prevailing on the dates of the
transactions. At each reporting date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates prevailing at
that date. Non-monetary items carried at fair value that are denominated in
foreign currencies are translated at the rates prevailing at the date when the
fair value was determined. Non-monetary items that are measured in terms of
historical cost in a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the period in which
they arise except for exchange differences on monetary items receivable from
or payable to a foreign operation for which settlement is neither planned nor
likely to occur in the foreseeable future (therefore forming part of the net
investment in the foreign operation), which are recognised initially in other
comprehensive income and reclassified from equity to profit or loss on
disposal or partial disposal of the net investment.
For the purpose of presenting consolidated financial statements, the assets
and liabilities of the Group's foreign operations are translated at exchange
rates prevailing on the reporting date. Income and expense items are
translated at the average exchange rates for the period, unless exchange rates
fluctuate significantly during that period, in which case the exchange rates
at the date of transactions are used. Exchange differences arising, if any,
are recognised in other comprehensive income and accumulated in a foreign
exchange translation reserve.
Goodwill and fair value adjustments arising on the acquisition of a foreign
entity are treated as assets and liabilities of the foreign entity and
translated at the closing rate. Exchange differences arising are recognised in
other comprehensive income.
Earnings per share
Basic earnings per share is calculated by dividing;
· the profit or loss attributable to the owners of the company,
excluding any costs of servicing equity other than ordinary shares;
· by the weighted average number of ordinary shares outstanding during
the financial year.
Diluted earnings per share adjusts the figures used in the determination of
basic earnings per share to take into account:
· after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares; and
· weighted average number of ordinary shares that would have been
outstanding assuming the conversion of all dilutive potential ordinary shares.
New standards and interpretations
a) New standards, amendments and interpretations adopted by the Group.
There were no new or amended accounting standards that required the Group to
change its accounting policies for the year ended 31 December 2025 and no new
standards, amendments or interpretations were adopted by the Group.
b) New standards, amendments and interpretations not yet adopted by the
Group.
The standards and interpretations that are relevant to the Group, issued, but
not yet effective, up to the date of the Financial Statements are listed
below. The Group intends to adopt these standards, if applicable, when they
become effective. The Directors do not expect any material impact as a result
of adopting the standards and amendments listed above in the financial year
they become effective.
Standard Impact on initial application Effective date
Annual Improvements to IFRS standards - Volume 11 Streamlined process for dealing efficiently with a collection of amendments to 1 January 2026
IFRSs
Amendments IFRS 9 and IFRS 7 regarding the classification and measurement of The amendments address matters identified during the post-implementation 1 January 2026
financial instruments review of the classification and measurement requirements of IFRS 9 Financial
Instruments.
IFRS 18 Presentation and Disclosures in Financial Statements IFRS 18 includes requirements for all entities applying IFRS for the 1 January 2027
presentation and disclosure of information in financial statements.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and entities controlled by the Company (its subsidiaries) made up
to 31 December each year. Per IFRS 10, control is achieved when the Company:
· has the power over the investee;
· is exposed, or has rights, to variable returns from its involvement
with the investee; and
· has the ability to use its power to affects its returns.
The Company reassesses whether or not it controls an investee if facts and
circumstances indicate that there are changes to one or more of the three
elements of control listed above. When the Company has less than a majority of
the voting rights of an investee, it considers that it has power over the
investee when the voting rights are sufficient to give it the practical
ability to direct the relevant activities of the investee unilaterally. The
Company considers all relevant facts and circumstances in assessing whether or
not the Company's voting rights in an investee are sufficient to give it
power, including:
· the size of the Company's holding of voting rights relative to the
size and dispersion of holdings of the other vote holders;
· potential voting rights held by the Company, other vote holders or
other parties;
· rights arising from other contractual arrangements; and
· any additional facts and circumstances that indicate that the Company
has, or does not have, the current ability to direct the relevant activities
at the time that decisions need to be made, including voting patterns at
previous shareholders' meetings.
Consolidation of a subsidiary begins when the Company obtains control over the
subsidiary and ceases when the Company loses control of the subsidiary.
Specifically, the results of subsidiaries acquired or disposed of during the
year are included in profit or loss from the date the Company gains control
until the date when the Company ceases to control the subsidiary. Where
necessary, adjustments are made to the financial statements of subsidiaries to
bring the accounting policies used into line with the Group's accounting
policies.
Inter-company transactions, balances and unrealised gains on transactions
between group companies are eliminated. Unrealised losses are also eliminated.
When necessary, amounts reported by subsidiaries have been adjusted to conform
with the group's accounting policies.
The Group recognises any non-controlling interest in the acquired entity at
the non-controlling interest's proportionate share of the acquired entity's
net identifiable assets. Subsequent to acquisition, the carrying amount of
non-controlling interests is the amount of those interests at initial
recognition plus the non-controlling interests' share of subsequent changes in
equity. The Group treats transactions with non-controlling interests that do
not result in a loss of control as transactions with equity owners of the
group. A change in ownership interest results in an adjustment between the
carrying amounts of the controlling and non-controlling interests to reflect
their relative interests in the subsidiary.
Profit or loss and each component of other comprehensive income are attributed
to the owners of the Company and to the non-controlling interests. Total
comprehensive income of the subsidiaries is attributed to the owners of the
Company and to the non-controlling interests even if this results in the
non-controlling interests having a deficit balance.
The loss attributable to non-controlling interest represents 26% of the total
losses from the South African subsidiaries' operations and 35% of the total
losses from the Australian subsidiary operations. For the South African
operations, non-controlling interests represent a 26% equity interest held by
BEE shareholders. Losses attributable to non-controlling interests have been
calculated proportionally and reported within equity.
Business combinations
The Group accounts for transactions that meet the definition of a business
combinations using the acquisition method. The cost of an acquisition is
measured as the aggregate of the consideration transferred, measured at
acquisition date fair value and the amount of any non-controlling interest in
the acquiree. For each business combination, the Group elects whether it
measures the non-controlling interest in the acquiree either at fair value or
at the proportionate share of the acquiree's identifiable net assets.
Acquisition costs incurred are expensed and included in administrative
expenses.
When the Group acquires a business, it assesses the financial assets and
liabilities assumed for appropriate classification and designation in
accordance with the contractual terms, economic circumstances and pertinent
conditions as at the acquisition date and are initially recognised at their
fair values at the acquisition date. This includes the separation of embedded
derivatives in host contracts by the acquiree.
Any contingent consideration to be transferred by the acquirer will be
recognized at fair value at the acquisition date. Contingent consideration
classified as an asset or liability that is a financial instrument and within
the scope of IFRS 9 Financial Instruments, is measured at fair value with
changes in fair value recognized either in the profit or loss or as a change
to other comprehensive income.
Goodwill is initially measured at cost, being the excess of the aggregate of
the consideration transferred and the amount recognized for non-controlling
interest over the net identifiable assets acquired and liabilities assumed. If
the fair value of the net assets acquired is in excess of the aggregate
consideration transferred, the gain is recognized in profit or loss.
After initial recognition, goodwill is measured at cost less any accumulated
impairment losses. For the purpose of impairment testing, goodwill acquired in
a business combination is, from the acquisition date, allocated to each of the
Group's cash-generating units that are expected to benefit from the
combination, irrespective of whether other assets or liabilities of the
acquiree are assigned to those units.
Inventory
Inventory is measured at lower of weighted average cost and net realisable
value.
Right-of-use-assets
The group recognises right-of-use assets at the commencement date of the lease
(i.e., the date the underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated depreciation and impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of
right-of-use-assets includes the amount of lease liabilities recognised,
initial direct costs, and lease payments made at or before the commencement
date less any incentives received.
Right-of-use-assets are depreciated on a straight-line basis over the shorter
of the lease term and the estimated useful lives of the assets. If the
ownership of the leased assets transfers to the group at the end of the lease
term or the cost reflects the exercise of a purchase option, depreciation is
calculated using the estimated useful life of the asset.
Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities
measured at the present value of lease payments to be made over the lease
term. The lease payments include fixed payments (including in substance fixed
payments) less any lease incentives receivable, variable lease payments that
depend on an index or a rate, and amounts expected to be paid under residual
value guarantees. The lease payments also include the exercise price of a
purchase option reasonably certain to be exercised by the Group and payments
of penalties for terminating the lease, if the lease term reflects the Group
exercising the option to terminate. Variable lease payments that do not depend
on an index or a rate are recognised as expenses (unless they are incurred to
produce inventories) in the period in which the event or condition that
triggers the payment occurs.
In calculating the present value of lease payments, the Group uses its
incremental borrowing rate at the lease commencement date if the interest rate
implicit in the lease is not readily determinable. After the commencement
date, the amount of lease liabilities is increased to reflect the accretion of
interest and reduced for the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a modification, a change
in the lease term, a change in the lease payments (e.g., changes to future
payments resulting from a change in an index or rate used to determine such
lease payments) or a change in the assessment of an option to purchase the
underlying asset.
Provisions
A provision is recognised when the Group has a present obligation (legal or
constructive) as a result of a past event and it is probable that an outflow
of resources embodying economic benefit will be required to settle the
obligation, and a reliable estimate can be made of the amount of obligation.
If the effect of the time value of money is material, provisions are
discounted using a current pre-tax rate that reflects, when appropriate, the
risks specific to the liability. When discounting is used, the increase in the
provision due to the passage of time is recognised as a finance cost.
The provision for environmental rehabilitation is recognised as and when an
obligation to incur rehabilitation and mine closure costs arises from
environmental disturbance caused by the development or ongoing production of a
mining property. For South Africa, the liability is calculated based on the
determined values as per the Department of Mineral Resources and Energy
("DMRE") which is reviewed and updated annually.
Revenue
The majority of the Group's revenue is derived from selling of rough gemstones
with revenue recognised at a point in time when control of the goods has
transferred to the customer. This is generally when the goods are delivered
to the customer.
Cost of sales
Cost of sales comprises the cost of inventories sold during the year,
including direct mining and processing costs, employee-related costs,
contractor charges, consumables, utilities, mine-site overheads and
depreciation of mining and processing assets used in production.
Critical Accounting Estimates and Judgements
In applying the Group's accounting policies, which are described in note 2
above, the Directors are required to make judgements (other than those
involving estimations) that have a significant impact on the amounts
recognised and to make estimates and assumptions about the carrying amounts of
assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and
other factors that are considered to be relevant. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in the period
of the revision and future periods if the revision affects both current and
future periods.
a) Critical judgement in the recoverability of exploration and evaluation
assets
Exploration and evaluation assets include mineral rights and exploration and
evaluation costs, including geophysical, topographical, geological and similar
types of costs. Exploration and evaluation costs are capitalised if management
concludes that future economic benefits are likely to be realised and
determines that economically viable extraction operation can be established as
a result of exploration activities and internal assessment of mineral
resources. According to 'IFRS 6 Exploration for and evaluation of mineral
resources', the potential indicators of impairment include: management's plans
to discontinue the exploration activities, lack of further substantial
exploration expenditure planned, expiry of exploration licences in the period
or in the nearest future, or existence of other data indicating the
expenditure capitalised is not recoverable. At the end of each reporting
period, management assesses whether such indicators exist for the exploration
and evaluation assets capitalised, which requires significant judgement. The
exploration projects are actively being progressed and therefore the Company
does not believe any circumstances have arisen to indicate these assets
require impairment.
b) Critical estimate in accounting for share-based payments and warrants
The Group has issued various share options and warrants to its service
providers. These are valued in accordance with IFRS 2 "Share-based payments".
The grant date fair value of such share-based payments is calculated using a
Black-Scholes model whose input assumptions are derived from market and other
internal estimates. Changes to these inputs may impact the related charge.
c) Critical judgement in accounting for contingent consideration
At 31 December 2025, the Group recognised an amount of £67,000 (2024:
£141,000) as contingent consideration, which relates to contingent
consideration payable to the owners of Gem - Venus Holdings Proprietary
Limited, on acquisition of the shares in Gem - Venus Holdings. Under the terms
of the SPA, the company was to pay a consideration of AU$200,000 (£99,323)
for each tranche of 5 million Carats of emerald mined, up to a maximum of AU$2
million (£993,226). In accordance with IFRS 3 paragraph 37, the management
has recognised the contingent consideration as part of the consideration
transferred in exchange for the acquiree, accordingly the contingent
consideration meets the definition of financial instrument as a financial
liability, and therefore the management have recognised this in accordance
with IAS 32. In recognising this financial liability, the management has used
a probability-weighted discount cash flow model and a discount rate of 10%, in
accordance with the market conditions, having regard to risk free rate, equity
risk premium and country specific risk premium. Changes to these may impact
the amount of liability recognised.
d) Valuation of equity instruments - Convertible Loan Notes
Convertible instruments can be complex, containing a number of features which
can have a significant impact on the accounting under IFRS 9 Financial
Instruments and IAS 32 Presentation of Financial Instruments. The Company
determined that the £1,500,000 convertible note issued as announced on 4
September 2025 was a compound financial instrument containing both liability
and equity components as the conversion feature results in the conversion of a
fixed amount of stated principal into a fixed number of shares, it satisfies
the 'fixed for fixed' criterion and, therefore, it is classified as an equity
instrument which requires the valuation of the liability component and the
equity conversion component. The fair value of the liability component,
included in current borrowings, at inception was calculated using a market
interest rate for an equivalent instrument without conversion option. The
discount rate applied was 10%.
e) Valuation of derivative asset
On 17 July 2024, GEMR entered into an agreement to acquire 65% of the equity
share capital of Prasinus Exploration Pty Ltd ("Prasinus"). As part of the
agreement, GEMR obtained the option to acquire the remaining 35% share capital
under a call option. The call option is valid for a 6-month period, from the
first anniversary of the completion of the acquisition to 18 months following
the completion of acquisition. The option was granted for a consideration of
A$1.00 and if exercised would require GEMR to pay in its ordinary shares equal
in value to A$300,000 (£148,984) on settlement. Management has determined
that this arrangement gives rise to a derivative asset which is required to be
measured at fair value at each reporting date. The determination of the fair
value of this derivative asset involves significant judgement and estimation
uncertainty because the instrument is not traded in an active market and its
valuation is based on a binomial option pricing model using significant
unobservable inputs. As the valuation incorporates significant inputs that are
not based on observable market data, the fair value measurement is classified
as Level 3 in the fair value hierarchy. Changes in the assumptions used,
particularly expected volatility and the estimated probability and timing of
exercise, could materially affect the carrying amount of the derivative asset
and the amount of any fair value gain or loss recognised in profit or loss.
e) Critical judgement in classification, capitalisation and valuation of
mine development and stripping activities
In determining the accounting treatment of mine development and stripping
costs incurred, management exercises significant judgment in assessing whether
such expenditure should be capitalised as part of property, plant and
equipment or recognised in profit or loss as incurred. This assessment
requires management to determine whether the costs relate to the production of
inventory in the current period or provide improved access to an identifiable
component of the ore body that will be mined in future periods. Mine
development and stripping costs are capitalised only when all recognition
criteria are met, including where it is probable that future economic benefits
associated with the activity will flow to the Group, the relevant component of
the ore body can be specifically identified, and the costs attributable to
that component can be measured reliably. The determination of the component of
the ore body benefiting from the stripping or development activity, and the
allocation of costs between current and future production, involves
significant judgment and is based on the life-of-mine plan. Capitalised
stripping and development assets are depreciated on a unit-of-production basis
over the expected useful life of the identified component of the ore body to
which they relate. The carrying amount of capitalised mine development and
stripping assets is also subject to estimation uncertainty. These assets are
reviewed for impairment when facts and circumstances indicate that their
carrying amount may not be recoverable. In assessing recoverable amount,
management uses discounted future cash flow models that incorporate estimates
and assumptions regarding reserves, expected production volumes, future
commodity prices, operating costs, capital expenditure, foreign exchange
rates, discount rates and the timing of extraction. Changes in these
assumptions may result in a material adjustment to the carrying amount of mine
development and stripping assets in future reporting periods.
f) Company Only - Critical judgement in the impairment assessment of
investment in and loans granted to subsidiaries
In preparing the parent company financial statements, the Directors apply
their judgement to decide if any or all of the Company's investments
(including capital contributions) in its subsidiaries should be impaired.
In undertaking their review, the Directors consider the outcome of their
impairment assessment in accordance with IAS 36. The Company assesses, at
each reporting date, whether there is an indication that an investment may be
impaired. If any indication exists, or when annual impairment testing for an
investment is required, the Company estimates the investment's recoverable
amount. Recoverable amount is the higher of an investment's or cash-generating
unit's (CGU) fair value less costs to sell and its value in use. The CGU's
were determined to be the three operational locations at Gravelotte, Malaika
and Prasinus. Recoverable amount is determined for an individual investment,
unless the investment does not generate cash inflows that are largely
independent of those from other investment or Groups of investments. When the
carrying amount of an investment or CGU exceeds its recoverable amount, the
investment is considered impaired and is written down to its recoverable
amount.
In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset.
The application of the IFRS 9 to loans due from subsidiary undertakings
requires significant management judgement and estimation. In particular,
judgement is required in assessing whether there has been a significant
increase in credit risk since initial recognition and therefore whether a
12-month ECL or lifetime ECL should be recognised for each exposure. This
assessment is inherently judgemental because the loans are to related parties
for which there is limited observable market data and the recoverability of
the balances depends primarily on the future financial performance and cash
generation of the relevant subsidiary undertakings. Given the level of
estimation involved, the ECL provision is sensitive to changes in assumptions
regarding the future profitability, cash generation and funding position of
the relevant subsidiary. A different assessment of increase in credit risk, or
changes in forecast cash flows and economic conditions, could result in a
material change to the impairment allowance recognised in future periods.
3. Operating expenses
2025 2024
£'000s £'000s
Audit fee of current auditor - Group (80) -
Audit fee of predecessor auditor- Group - (90)
Audit fee of predecessor auditor - Group - preceding periods under accrual (3) (25)
Audit fee - Subsidiaries (10) (13)
Accounting (79) (49)
Amortisation and depreciation (87) (45)
Directors' remuneration (190) (205)
Staff salaries (48) (40)
General expenses (6) (51)
Legal and professional fees (112) (123)
Foreign exchange losses (37) -
Consultancy fees (40) (13)
FCA fee (26) (25)
Director and officer insurance (6) (8)
Share based payment expense - (85)
Other operating expenses (5) (380)
Total (729) (1,152)
4. Taxation
2025 2024
£'000s £'000s
UK Corporation tax - -
Deferred tax 8 -
Total tax charge 8 -
The tax charge can be reconciled to the profit for the period as follows: (942) (1,862)
Loss for the period
Tax at the standard rate of UK corporation tax of 25% (2024: 25%) (236) (466)
Effects of:
Disallowed expenses 1 1
Increase in tax losses carried forward 243 465
Total tax charge 8 -
As at 31 December 2025, the Company had unused tax losses of £5.7 million
(2024: £5.4 million) available for offset against future profits. The
deferred tax asset relating to these losses is not provided for due to the
uncertainty over the timing of any future non-trading profits.
5. Staff Costs (including Directors)
2025 2024
£'000s £'000s
As salary and fees:
Peter Redmond 40 35
John Treacy 24 24
Edward Nealon 40 43
Bernard Olivier 70 63
Sam Mulligan(1) (24) 40
Louis Ching 33 -
Hans Wong 8 -
Other staff 40 40
Other consultants 82 77
Closing balance 313 322
(1) Sam Mulligan resigned on 18 June 2025 and previous accrued fees reversed.
The average monthly number of employees, including the Directors, during the
year was as follows:
2025 2024
Staff/consultants 24 28
Directors 7 5
Total 31 33
Included within staff costs is an amount of £40,000 paid to Jeremy
Sturgess-Smith who is a Key Management Personnel. An amount of £nil (2024:
£34,161) has been charged in respect of unapproved option plan for Jeremy
Sturgess-Smith.
Wessel Marais and Louis Swart are both directors at the South African entities
of the Group and are considered Key Management Personnel. An amount of
£46,000 (2024: £61,510) has been charged to professional and accounting fees
for Wessel Marais and £36,000 (2024: £15,000) for Louis Swart.
Share based payments
The amount recognised in respect of share-based payments was £nil (2024:
£85,403).
The Group has established share option programmes that entitle certain
employees to purchase shares in the Group.
Share options outstanding to Directors or employees are as follows:
Name Number of Options: Exercise Price: Date of Grant: Expiry Date:
Bernard Olivier 8,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
Peter Redmond 4,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
Jeremy Sturgess-Smith 8,000,000 1(st) Tranche - 2p per share; 2(nd) tranche- 2.5p per share and 3rd tranche 1 September 2021 1 September 2031
2.7p per share.
In all cases the options vest in three equal tranches. The initial tranche,
equal to 25% of the total award, vested on 2 March 2022, at the Company's
initial listing on the Main Market of the London Stock Exchange, with an
exercise price of 2 pence per share; the second tranche, equal to 37.5% of
the total award, vested on 2 March 2023, on the first anniversary of the
Company's initial listing at an exercise price equal to 2.5 pence per share;
and the third tranche, equal to 37.5% of the total award, vests on 2 March
2024, the second anniversary of the Company's initial listing at an exercise
price of 2.7 pence per share.
There are no performance conditions attaching to these options. No options
were exercised in 2025 (2024: Nil).
No new options were issued during 2025 and the total options in issue as at
31 December 2025 amount to 20,000,000 (2024: 20,000,000).
Pensions
The Company did not operate a pension scheme during the period and has not
paid any contributions to any scheme for Directors and employees.
All eligible Directors and employees have been invited to participate in the
Company's pension scheme with True Potential. All Directors and employees
have opted out of the workplace pension.
6. Earnings per share
Earnings per share is calculated by dividing the loss for the period
attributable to ordinary equity shareholders of the parent by the number of
ordinary shares outstanding during the year.
During the year the calculation was based on the loss for the year
attributable to owners of the parent of £864,000 (2024: £1,728,000) divided
by the weighted number of ordinary shares 406,545,749 (2024: 283,957,748).
The diluted loss per share and the basic loss per share are recorded as the
same amount as conversion of the share options and warrants decreases the
basic loss per share, thus being anti-dilutive.
7. Property, plant and equipment
COST Fixture and fittings Plant and equipment Mine development and stripping activity Total Assets
£'000 £'000 £'000 £'000
Restated Restated Restated Restated
At 1 January 2025 44 255 206 505
Additions - - 25 25
Foreign exchange 2 11 12 25
At 31 December 2025 46 266 243 555
AMORTISATION / IMPAIRMENT
At 1 January 2025 24 79 - 103
Charge for the year 5 71 - 76
Foreign exchange 1 5 - 6
At 31 December 2025 30 155 - 185
CARRYING VALUE
At 31 December 2025 16 111 243 370
At 31 December 2024 20 176 206 402
8. Leases
Right of use asset
Following are the changes in the carrying value of right of use assets for the
year ended 31 December 2025.
COST Car Lease
£'000
At 1 January 2025 34
Foreign exchange 1
At 31 December 2025 35
DEPRECIATION
At 1 January 2025 5
Charge for the year 11
Foreign exchange -
At 31 December 2025 16
CARRYING VALUE
At 31 December 2025 19
At 31 December 2024 29
Lease liabilities
2025 2024
£'000s £'000s
Minimum lease payments which fall due
- Within one year 14 14
- In second to fifth year inclusive 7 20
21 34
Less: future finance charges (2) (5)
Present value of minimum lease payments 19 29
2025 2024
£'000s £'000s
Current lease liabilities 12 10
Non-current lease liabilities 7 19
19 29
9. Exploration and evaluation assets
Cost and net book value 2025 2024
£'000s £'000s
Restated
At beginning of period 462 1,176
Additions during the year 3 58
Acquired through business combination - 189
Transfer to property, plant and equipment - (205)
Impairment - (754)
Foreign exchange 5 (2)
Closing balance 470 462
In accordance with IFRS 6, the Directors undertook an assessment of the
following areas and circumstances which could indicate the existence of
impairment:
· The Group's right to explore in an area has expired or will expire in
the near future without renewal.
· No further exploration or evaluation is planned or budgeted for.
· A decision has been taken by the Board to discontinue exploration and
evaluation in an area due to the absence of a commercial level of reserves.
· Sufficient data exists to indicate that the book value may not be
fully recovered from future development and production.
During 2024, the Company was informed that the renewal of one of its licences
held by Malaika Developments Limited was rejected. Following this, an appeal
was lodged directly with the Minister of Mines and we are awaiting a
response. Given the uncertainty around the renewal, the Directors concluded
that an impairment charge in respect of the rejected licence application, was
necessary for the year ended 31 December 2024. The estimate was based on the
proportionate size of the licence area not renewed. The one remaining licence
of Malaika Developments Limited expired on 30 January 2026 and an application
for renewal has been submitted. Management assessed there is a high
probability for the licence to be renewed and therefore does not indicate an
existence of impairment.
10. Inventories
2025 2024
£'000s £'000s
Rough inventory carried at lower of cost and net realisable value 38 9
Closing balance 38 9
11. Other Receivables
2025 2024
£'000s £'000s
Prepayments 18 30
Sundry debtors - 15
VAT recoverable 12 56
Closing balance 30 101
The Directors consider that the carrying amount of other receivables is
approximately equal to their fair value. Included in sundry debtors for 2024
is an amount of £15,000 due by Peter Redmond which is unsecured and interest
free.
12. Derivative asset
2025 2024
£'000s £'000s
Restated
At beginning of period 18 -
Derivative asset at initial recognition - 23
Change in fair value (18) (5)
Closing balance - 18
On 17 July 2024, GEMR entered into an agreement to acquire 65% of the equity
share capital of Prasinus Exploration Pty Ltd ("Prasinus"). As part of the
agreement, GEMR obtained the option to acquire the remaining 35% share capital
under a call option. The call option is valid for a 6-month period, from the
first anniversary of the completion of the acquisition to 18 months following
the completion of acquisition. The option was granted for a consideration of
A$1.00 and if exercised would require GEMR to pay in its ordinary shares equal
in value to A$300,000 (£148,984) on settlement.
The option is a derivative financial instrument recognised on the statement of
financial position at fair value. The option expired unexercised on 17
January 2026.
13. Restricted cash
2025 2024
£'000s £'000s
At beginning of period 12 -
Deposited at DMRE - 12
Foreign exchange 1 -
Closing balance 13 12
Restricted cash consists of amounts paid as rehabilitation deposit to the
Department of Mineral Resources and Energy ("DMRE") in South Africa. The
deposit is refundable upon mine closure or licence surrender conditional upon
the statutory rehabilitation obligations being completed to the satisfaction
of the DMRE.
14. Contingent consideration
2025 2024
£'000s £'000s
Restated
At beginning of period 141 173
Change in fair value (74) (32)
Closing balance 67 141
On 24 February 2023, the Company completed its acquisition of the entire
issued share capital of Gem - Venus Holdings Proprietary Limited for a
consideration in form of fully paid up GEMR shares amounting to £100,000 and
a contingent consideration.
The contingent consideration arrangement required the Company to pay the
former owners of Gem - Venus Holdings Proprietary Limited, a maximum of AU$2
million (£993,226), payable in tranches of AU$200,000 (£99,323) for every 5
million carats of gemstones produced at the mine.
In accordance with IFRS 3, management has recognised the contingent
consideration as part of the consideration transferred in exchange for the
acquiree. The fair value of the contingent consideration was estimated at the
acquisition date using a probability-weighted discounted cash flow approach,
estimating timing of reaching each 5 million carat milestone at a discount
rate of 10%. At the acquisition date, the fair value of this contingent
consideration was estimated to be £173,000.
The liability is remeasured to fair value at each reporting period, with any
changes recognised in the profit or loss.
15. Provisions
2025 2024
£'000s £'000s
Rehabilitation
At beginning of period 12 -
Provision raised 28 12
Closing balance 40 12
The rehabilitation provision was provided based on DMRE agreed values for
expected closure and rehabilitation of mines area and is assessed annually.
16. Deferred tax liability
2025 2024
£'000s £'000s
At beginning of period 8 -
Reversal through profit and loss (8) -
Acquired through business combination - 8
Closing balance - 8
17. Trade and other payables
2025 2024
£'000s £'000s
Trade payables 72 232
Other payables - 17
Accruals 384 239
Closing balance 456 488
The Directors consider that the carrying amount of trade payables approximates
to their fair value. Accruals predominantly comprise audit fee accrual of
£83,000 (2024: £88,000) and accrued and unpaid Directors and KMP salaries of
approximately £276,000 (2024: £125,000).
18. Convertible loan notes
2025 2024
£'000s £'000s
Proceeds from issue of convertible loan notes 1,500 -
Amount classified as equity (180) -
Interest 42 -
Payments (25) -
Closing balance 1,337 -
In September 2025, the Company issued unsecured convertible loan notes in the
principal amount of £1.5 million ("Convertible Loan Notes") to Louis Ching.
The Convertible Loan Notes are convertible at £0.003 per share and carry a 5%
annual interest, payable semi-annually in arrears on 30 June and 31 December
each year and may be converted at any time up until 3 September 2028. Any
portion of the loan not converted must be repaid in full at maturity together
with accrued interest.
As the conversion feature results in the conversion of a fixed amount of
stated principal into a fixed number of shares, it satisfies the 'fixed for
fixed' criterion and, therefore, it is classified as a compound financial
instrument comprising a liability component and an equity component which
requires the valuation of the liability component and the equity conversion
component. The fair value of the liability component, included in current
borrowings (due to being exercisable at any time up to 3 September 2028), at
inception was calculated using a market interest rate for an equivalent
instrument without conversion option. The discount rate applied was 10%.
19. Share capital
2025 2024
£'000s £'000s
Allotted, called up and fully paid share capital 62 30
Movements in Equity
2025 Number of shares in issue
Opening balance of Ordinary Shares in issue of £0.0001 each 302,658,090
Fees settled in shares 5,999,998
Share subscription 308,658,088
Closing balance of Ordinary Shares in issue of £0.0001 each 617,316,176
Issue of Equity in Lieu of Director's Fees
On 28 February 2025, Directors Dr Bernard Oliver, Edward Nealon and Peter
Redmond, agreed to the issue of 5,999,998 new ordinary shares of £0.0001 each
("Ordinary Shares") at an issue price of 0.65 pence per Ordinary Share in lieu
of cash settlement of part of their accrued and unpaid fees.
In prior year the movements in equity were as below:
2024 Number of shares in issue
Opening balance of Ordinary Shares in issue of £0.0001 each 252,345,590
Shares issued 50,312,500
Closing balance of Ordinary Shares in issue of £0.0001 each 302,658,090
The Company has one class of ordinary share which carry no right to fixed
income.
Share Capital 2025 2024
£'000s £'000s
At the beginning of the year 30 25
Issued in the year 32 5
At the end of the year 62 30
Share Premium 2025 2024
£'000s £'000s
At the beginning of the year 4,690 3,980
Issued in the year 629 883
Issue cost (55) (173)
At the end of the year 5,264 4,690
Ordinary shares
All shares rank equally with regard to the Company's residual assets. The
holders of ordinary shares are entitled to receive dividends as declared from
time to time and are entitled to one vote per share at meetings of the
Company.
Share Premium
Represents excess paid above nominal value of shares issued.
20. Reserves
The following describes the nature and purpose of each reserve:
Share option reserve
This represents the amounts charged on share options that have been granted to
employees and directors less amounts transferred on exercise or lapse.
Share warrant reserve
This represents amounts charged on share warrants granted to service providers
less amounts transferred on exercise or lapse.
Foreign exchange translation reserve
This represents amounts charged through other comprehensive income related to
the translation of subsidiaries' financial statements from a currency other
than the Group's presentation currency (£).
Equity component of convertible loan notes reserve
The reserve for convertible loan notes comprises the amount allocated to the
equity component for the convertible loan notes issued by the Company in
September 2025.
21. Share-based payments
At the year end, the Company had the following share-based payment plans
involving equity settled share options and warrants in existence:
Share options
Number Date granted Exercise price Maximum term Vesting dates
5,000,000 01/09/2021 2p Expire on 01/09/2031 Admission
7,500,000 01/09/2021 2.5p Expire on 01/09/2031 02/03/2023
7,500,000 01/09/2021 2.7p Expire on 01/09/2031 02/03/2024
20,000,000
Warrants
Number Date granted Exercise price Maximum term Vesting dates
125,000 01/09/2023 2.4p Expire on 31/08/2026 Upon being granted
3,184,000 01/11/2023 1.25p Expire on 13/12/2026 Upon being granted
1,425,000 26/02/2024 2p Expire on 25/02/2027 Upon being granted
4,734,000
The number and weighted average exercise prices of the above options and
warrants are as follows:
31 December 2025 31 December 2024
Number Weighted average exercise price Number Weighted average exercise price
Outstanding at beginning of year 53,609,000 2.12p 52,184,000 2.13p
Lapsed warrants (28,875,000)(1) 2p - -
Warrants issued - - 1,425,000 2p
Outstanding at end of year 24,734,000 2.27p 53,609,000 2.12p
(1) Warrants granted on 25 February 2022 with an expiration date of 24
February 2025 lapsed due to expiry.
The share options and warrants have been valued using the Black Scholes option
pricing model.
22. Financial instruments
Financial assets and liabilities by category
2025 2024
£'000s £'000s
Restated
Carrying amount of financial assets
Current
Measured at amortised cost
- Other receivables 4 15
- Restricted cash 13 12
- Cash and cash equivalents 1,613 414
Non-current
Measured at fair value through profit or loss
- Derivative asset - 18
1,630 459
2025 2024
£'000s £'000s
Restated
Carrying amount of financial liabilities
Current
Measured at amortised cost
- Lease liability 12 10
- Trade and other payables 456 488
Non-current
Measured at amortised cost
- Lease liability 7 19
- Convertible debt 1,337 -
Measured at fair value through profit or loss
- Contingent consideration 67 141
1,879 658
Fair value estimation
The following table compares the carrying amounts and fair values of the
Group's financial assets and financial liabilities as at 31 December 2025.
The Group considers that the carrying amount of the following financial assets
and financial liabilities are a reasonable approximation of their fair value:
• Other receivables;
• Trade and other payables;
• Convertible debt;
• Restricted cash; and
• Cash and cash equivalents.
31 December 2025 31 December 2024
Carrying amount Fair Carrying amount Fair
£'000s value £'000s value
£'000s £'000s
Financial Assets
Derivative asset - - 18 18
Financial Liabilities
Contingent consideration 67 67 141 141
This note provides an update on the judgements and estimates made by the Group
in determining the fair values of the financial instruments.
(i) Financial instruments measured at fair value
The financial instruments recognised at fair value in the Statement of
Financial Position have been analysed and classified using a fair value
hierarchy reflecting the significance of the inputs used in making the
measurements.
(ii) Fair value hierarchy
The fair value hierarchy consists of the following levels
• Quoted prices in active markets for identical assets and liabilities
(Level 1);
• Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (as prices) or
indirectly (derived from prices) (Level 2); and
• Inputs for the asset and liability that are not based on observable
market date (unobservable inputs) (Level 3).
Level 1 Level 2 Level 3 Total
£'000s £'000s £'000s £'000s
31 December 2025
Financial assets
Derivative asset - - - -
Financial liabilities
Contingent consideration - - 67 67
31 December 2024
Financial assets
Derivative asset - - 18 18
Financial liabilities
Contingent consideration - - 141 141
There were no transfers between levels for recurring fair value measurements
during the year.
(iii) Reconciliation: Level 3 fair value measurement
2025 2024
£'000s £'000s
Restated
Derivative asset
Opening balance 18 -
Derivative asset at initial recognition through profit or loss - 23
Change in fair value through profit or loss (18) (5)
Closing balance - 18
2025 2024
£'000s £'000s
Restated
Contingent consideration
Opening balance 141 173
Change in fair value through profit or loss (74) (32)
Closing balance 67 141
(iv) Valuation technique used to determine fair value
Derivative asset:
On 17 July 2024, GEMR entered into an agreement to acquire 65% of the equity
share capital of Prasinus Exploration Pty Ltd ("Prasinus"). As part of the
agreement, GEMR obtained the option to acquire the remaining 35% share capital
under a call option. The call option was valid for a 6-month period, from the
first anniversary of the completion of the acquisition to 18 months following
the completion of acquisition. The option was granted for a consideration of
A$1.00 and if exercised would require GEMR to pay in its ordinary shares equal
in value to A$300,000 (£148,984) on settlement.
The option is a derivative financial instrument recognised on the statement of
financial position at fair value.
The fair value of the option was determined using a binomial option pricing
model. The inputs into the model are as follows:
31 Dec 2025 31 Dec 2024 17 July 2024
Stock price A$242.31 A$242.31 A$242.31
Exercise price A$300.00 A$300.00 A$300.00
Sigma per annum 50% 50% 50%
Maximum time 0.04 years 1.04 years 1.5 years
Risk free rate 4% 4% 4%
Dividend yield 0% 0% 0%
Vesting time 0.001 years 0.54 years 1 years
Contingent consideration:
The fair value of this contingent consideration was estimated using a
probability-weighted discounted cash flow approach. This method accounts for
production scenarios, the estimated timing and probability of reaching each
5-million-carat milestone.
The following significant unobservable inputs were used to determine the fair
value (Level 3):
Production forecasts: Based on the Life-of-Mine (LOM) plan, which assumes an
average annual production of 1.6 million carats.
Probability of achievement: Management assigned diminishing probabilities to
reaching each production tranche within the 17-year forecast period.
Discount rate: A discount rate of 10.37% was applied to the expected cash
flows to reflect the time value of money.
23. Financial risk
Interest rate risk
The Company's exposure to interest rate risk, which is the risk that a
financial instrument's value will fluctuate as a result of changes in market
interest rates on classes of financial assets and financial liabilities, was
as follows:
Floating interest rate Floating interest rate
2025 2024
£'000s £'000s
Cash 1,613 414
1,613 414
Financial risk management
The Directors recognise that this is an area in which they may need to develop
specific policies should the Company become exposed to further financial risks
as the business develops.
Capital risk management
The Company considers capital to be its equity reserves. At the current stage
of the Company's life cycle, the Company's objective in managing its capital
is to ensure funds raised meet the Company's working capital commitments.
Credit risk management
With respect to credit risk arising from financial assets of the Company,
which comprise cash and cash equivalents held in financial institutions, the
Company are deemed to be at low credit risk.
Liquidity risk
The Company manages liquidity risk by maintaining adequate banking facilities
and borrowing facilities. The Company continuously monitor forecasts and
actual cash flows, matching the maturity profiles of financial assets and
liabilities and future capital and operating comments. The Directors
consider the Company to have adequate current assets and forecast cash from
operations to manage liquidity risks arising from current and non-current
liabilities.
The table below analyses the Group's financial liabilities into relevant
maturity groupings based on the remaining period at the statement of financial
position to the contractual maturity date. The amounts disclosed in the table
are the contractual undiscounted cash flows.
Less than one year Between one and two years Between two and five years Over five years
£'000s £'000s £'000s £'000s
31 December 2025
Lease liabilities 12 7 - -
Contingent consideration - - - 995
Trade and other payables 456 - - -
Convertible debt 76 76 1,551 -
544 83 1,551 995
31 December 2024
Lease liabilities 10 19 - -
Contingent consideration - - 99 887
Trade and other payables 488 - - -
Convertible debt - - - -
498 19 99 887
Foreign currency risk
Foreign currency risk is the risk that fair value or future cash flows of a
financial instrument will fluctuate because of changes in foreign exchange
rates. The Group reports in Pounds Sterling, but the functional currency of
its subsidiaries are in Australian Dollars (AU$), South African Rands (ZAR)
and Zambian Kwacha (ZMW). The Group does not currently hedge its exposure to
currencies. The Group's cash and cash equivalents are held in Pounds Sterling,
Australian Dollars, South African Rand, Hong Kong Dollars and Zambian Kwacha.
Sensitivity analysis
A 10 per cent strengthening of the Pounds Sterling against the following
currencies at 31 December would have increased/(decreased) profit or loss by
the amounts shown below. The analysis assumes that all other variables, in
particular interest rates, remain constant. The analysis is performed on the
same basis as at 31 December 2024.
2025 2024
£'000 £'000
Australian Dollars - (5)
South African Rand (30) (39)
Hong Kong Dollars (1) -
United States Dollars (146) -
Zambian Kwacha (3) 1
Funding risk
Funding risk is the possibility that the Group might not have access to the
financing it needs. The Group's continued future operations depend on the
ability to raise sufficient working capital through the issue of equity share
capital. The Directors are confident that adequate funding will be forthcoming
with which to finance operations. The Directors have a strong track record of
raising funds as required. Controls over expenditure are carefully managed and
activities planned to ensure that the Group has sufficient funding.
24. Related party transactions
(a) Parent entity
The parent entity within the Group is Gem Resources Plc.
(b) Subsidiaries
Interest in subsidiaries are shown in note 3 to the Company Financial
Statements.
(c) Transactions with related parties
All the Director's and KMP remuneration as disclosed in note 5.
As was announced on 28 February 2025, the Company issued 5,999,998 new
ordinary shares of £0.0001 each ("Ordinary Shares") at an issue price of 0.65
pence per Ordinary Share to the Directors, Bernard Olivier, Edward Nealon and
Peter Redmond in lieu of cash settlement of part of their accrued fees
totalling £39,000.
Number of shares issued
Bernard Olivier 3,230,769
Edward Nealon 1,846,153
Peter Redmond 923,076
5,999,998
The following table provides details of outstanding balances to Directors and
KMP at the year-end date:
2025 2024
£'000s £'000s
Peter Redmond 31 15
John Treacy 25 9
Edward Nealon 39 18
Bernard Olivier 58 32
Sam Mulligan - 28
Louis Ching 33 -
Hans Wong 2 -
Jeremy Sturgess-Smith 32 22
Wessel Marais 32 36
Louis Swart 24 -
276 160
The above amounts outstanding are unsecured and repayable on demand.
As was agreed on 20 November 2025, by resolution at a General Meeting, the
Company has the authority to issue 64,836,034 new ordinary shares of £0.0001
each ("Ordinary Shares") at an issue price of 0.3 pence per Ordinary Share to
certain Directors and Key Management Personnel in lieu of cash settlement of
part of their accrued fees.
As announced on 4 September 2025, GEMR issued unsecured convertible loan notes
in the principal amount of £1.5 million ("Convertible Loan Notes") to Louis
Ching. The Convertible Loan Notes are convertible at £0.003 per share and
carry a 5% annual interest, payable semi-annually in arrears on 30 June and 31
December each year and may be converted at any time up until 3 September
2028. Any portion of the loan not converted must be repaid in full at
maturity together with accrued interest.
25. Segment information
An operating segment is a component of the Group that engages in business
activities from which it can earn revenues and incurs expenses, including
revenue and expenses that relate to transactions with any of the Group's other
components.
An operating segment's operating results are reviewed regularly by the Chief
Operating Decision Maker ("CODM") which in the case of the Group is the Board
of Directors. The CODM makes decisions about the resources to be allocated to
the segment and assesses its performance, where discrete financial information
is available.
Operating segments
The Board considers that the Group has one operating segment, being that of
emerald mining and exploration. Accordingly, all revenues, operating
results, assets and liabilities are allocated to this activity. The UK and
Hong Kong are used for the administration of the Group.
Geographical segments
The Group's loss before tax arose from its operations in the UK, South Africa,
Zambia, Australia and Hong Kong.
For the year ended 2025
UK South Zambia Australia Hong Kong Group
Africa
£'000 £'000 £'000 £'000 £'000 £'000
Revenue - 45 - - - 45
Consolidated loss before tax (537) (315) 14 (69) (35) (942)
Total assets 150 446 276 216 1,465 2,553
Total liabilities (1,791) (121) (2) (5) - (1,919)
For the year ended 2024
UK South Zambia Australia Hong Kong Group
Africa
£'000 £'000 £'000 £'000 £'000 £'000
Revenue - - - - - -
Consolidated loss before tax (1,375) (442) (32) (13) - (1,862)
Total assets 365 541 270 271 - 1,447
Total liabilities (497) (122) (38) (21) - (678)
26. Events after the period end date
As at 6 February 2026, the Company's wholly owned subsidiary incorporated in
Hong Kong, GemR Corporation Limited ("GEMR HK"), has acquired an aggregate of
9.00000000 Bitcoin ("BTC") for total execution consideration of approximately
US$633,200.00, excluding trading fees of approximately US$1,484.60. Including
trading fees, the total cash outlay was approximately US$634,684.60. This is a
non-adjusting event and does not affect the 31 December 2025 year end balances
as the purchases were executed after yearend.
The BTC purchases were executed through multiple individual trades on HashKey
Exchange, a regulated digital asset trading platform in Hong Kong, at a volume
weighted average execution price, excluding fees, of approximately
US$70,355.56 per BTC, and an all in average acquisition price, including fees,
of approximately US$70,520.51 per BTC.
This initial Bitcoin allocation has been funded entirely from existing Group
cash resources. To date, all acquisitions under the policy have been Bitcoin
and no other digital assets have yet been acquired. The board of the Company
will continue to review the capital adequacy parameters of the cash reserves
for the Company to ensure that sufficient working capital for its near-term
costs are held in cash.
During Q1 2026, heavy rainfall and significant flooding occurred across the
Limpopo Province, causing damaged infrastructure, inaccessible roads, and
disruptions to water and electricity supply. The flooding did not cause
significant physical damage to the plant, equipment or mine infrastructure at
the Gravelotte mine. However, elevated water levels have required sustained
dewatering and site access has been intermittently affected. Dewatering and
recovery activities are underway. Following dewatering activities the mine
would be able to restart production.
27. Acquisition of subsidiaries
In the prior year on 17 July 2024, the Company announced the acquisition of a
65% interest in Prasinus Exploration Pty Ltd ("Prasinus"), the owner of the
Curlew Emerald Mine located in the Pilbara Region of Western Australia
("Curlew Mine") for a consideration of AU$450,000 (£232,000) and a call
option to acquire the remaining 35% interest for a further AU$300,000
(£149,000) in GEMR shares expiring on 18 January 2026. In the prior year the
acquisition was recorded as a business combination, but management has now
concluded that the acquiree does not constitute a business as defined in IFRS
3 (no substantive process capable of producing outputs). Refer to note 28 for
further details. Accordingly, the transaction has been accounted for as an
asset acquisition in terms of IFRS 3 (scope exclusion) and IFRS 6 for
exploration and evaluation assets. No goodwill has been recognised. The
consideration has been allocated to the identifiable assets and liabilities
based on their relative fair values at the acquisition date. The excess of
consideration over the fair value of other net identifiable assets has been
attributed to exploration and evaluation assets, being the predominant asset
acquired.
The amounts recognised in respect of the identifiable assets acquired and
liabilities assumed as a result of the acquisition are as follows:
£'000
Exploration and evaluation assets 189
Property, plant and equipment 83
Trade and other receivables 1
Trade and other payables (13)
Deferred tax liability (8)
Non-controlling interest at proportionate share (20)
Total identifiable assets acquired, and liabilities assumed 232
Fair value of consideration paid:
Cash paid 232
Consideration transferred 232
28. Prior period adjustments
(i) Restatement of prior year balances
Management reviewed the application of IFRS 3 in its historic acquisitions of
Malaika Exploration (Ireland) Limited, Gem - Venus Holdings (Pty) Ltd and
Prasinus Exploration Pty Ltd. All the acquisitions were accounted for
previously as business combinations under IFRS 3. However, the review
revealed that Malaika Exploration (Ireland) and Prasinus Exploration Pty Ltd
lacked a substantive process to qualify as a business combination and
therefore, should have been accounted for as asset acquisitions and that
substantially all of the fair value of the gross assets acquired is
concentrated in the exploration and evaluation assets acquired. Goodwill is
therefore accordingly adjusted.
Furthermore, in the review of the Gem - Venus Holdings (Pty) Ltd business
combination a contingent consideration is payable in the amount of a maximum
of AU$2 million (£993,226), payable in tranches of AU$200,000 (£99,323) for
each 5 million carats of emeralds produced at the mined. Management previously
has recognised the contingent consideration at AU$2 million payable in 10
years using a discount rate of 10% recording an interest charge of £44,000 in
the prior year and it has been concluded that it should have been fair valued
taking into consideration the probability-weighted discounted cash flow
approach. This requires recognising the liability based on the estimated
future payments, adjusted for the likelihood of achieving the specific
targets. The £44,000 interest charge was reversed and a fair value
adjustment for the year ended 31 December 2024 of £32,000 was recorded in
relation to the contingent consideration.
In the prior year, GEMR entered into an agreement to acquire 65% of the equity
share capital of Prasinus Exploration Pty Ltd ("Prasinus"). As part of the
agreement, GEMR obtained the option to acquire the remaining 35% share capital
under a call option. The call option was valid for a 6-month period, from the
first anniversary of the completion of the acquisition to 18 months following
the completion of acquisition. The option was granted for a consideration of
A$1.00 and if exercised would require GEMR to pay in its ordinary shares equal
in value to A$300,000 (£148,984) on settlement. The fair value of the
option was not accounted for as a derivative asset in the prior year and is
now stated at £18,000 as at 31 December 2024.
During the year, the Company identified a prior period presentation error in
the stand-alone financial statements whereby an amount of £264,000 had been
incorrectly credited against investments in subsidiaries. This amount should
instead have been credited against amounts owed by group companies included in
other receivables. Accordingly, the prior year comparatives have been restated
to reallocate £264,000 from investments in subsidiaries to other receivables.
Consequently, the prior period statement of financial position as at
31 December 2024 and 1 January 2024 have each been restated in accordance
with IAS 8, and, in accordance with IAS 1 (revised). The restatement
involved adjustments to goodwill, property, plant and equipment, investment in
subsidiaries, exploration and evaluation assets, contingent consideration,
reduction in interest expense related to the contingent consideration
previously incorrectly being discounted and fair value adjustments to the
derivative asset through profit and loss.
Impact on adjustment on the consolidated statement of financial position
1 Jan 2024 Prior year adjustment 1 Jan 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Goodwill 1,286 (1,286) -
Exploration and evaluation assets 153 1,023 1,176
Contingent consideration 436 (263) 173
Increase in retained earnings (2,362) - (2,362)
Impact on Profit and Loss (1,132) - (1,132)
Effect on total equity -
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Goodwill 728 (728) -
Property, plant and equipment 373 29 402
Exploration and evaluation assets 26 436 462
Derivative asset - 18 18
Contingent consideration 479 (338) 141
Increase in retained earnings (4,184) 94 (4,090)
Impact on Profit and Loss (1,956) 94 (1,862)
Effect on total equity 94
Impact on adjustment on the company statement of financial position
1 Jan 2024 Prior year adjustment 1 Jan 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Investment in subsidiaries 1,272 1(1) 1,273
Other receivables 846 (264) 582
Contingent consideration 436 (263) 173
Increase in retained earnings (2,193) - (2,193)
Impact on Profit and Loss (868) - (868)
Effect on total equity -
(1) Net effect of movement in other receivables and contingent consideration.
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Investment in subsidiaries 752 1 754
Derivative asset - 18 18
Contingent consideration 479 (338) 141
Increase in retained earnings (3,661) 94 (3,567)
Impact on Profit and Loss (1,468) 94 (1,374)
Effect on total equity 94
Impact on adjustment on the consolidated statement of comprehensive income
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Change in fair value of derivative asset - 18 18
Change in fair value of contingent consideration - 32 32
Finance cost (50) 44 (6)
Impact on adjustment on the company statement of comprehensive income
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Change in fair value of derivative asset - 18 18
Change in fair value of contingent consideration - 32 32
Finance cost (44) 44 -
The earnings per share have been restated as the adjustment affects the profit
or loss attributable to owners of the parent used as the numerator.
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Loss attributable to owners of the parent (1,822) 94 (1,728)
Earnings per share
Basic and diluted earnings per share (pence) (0.64) 0.03 (0.61)
Impact on adjustment on the consolidated statement of cash flows
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Cash flows from operating activities
Loss for the period (1,956) 94 (1,862)
Adjustments for:
Changes in fair value of derivative asset - (18) (18)
Changes in fair value of contingent consideration - (32) (32)
Finance cost 50 (44) 6
Impact on adjustment on the company statement of cash flows
31 Dec 2024 Prior year adjustment 31 Dec 2024
(as previously stated (as re-stated)
£'000 £'000 £'000
Cash flows from operating activities
Loss for the period (1,468) 94 (1,374)
Adjustments for:
Changes in fair value of derivative asset - (18) (18)
Changes in fair value of contingent consideration - (32) (32)
Finance cost 44 (44) -
Company Statement of Financial Position
Company number: 05329401 31 Dec 2025 31 Dec 2024 1 Jan 2024
£'000s £'000s £'000s
ASSETS Note Restated* Restated*
Non-current assets
Investment in subsidiaries 3 755 754 1,273
Other receivables 4 216 - -
Total non-current assets 971 754 1,273
Current assets
Other receivables 4 2,437 1,084 582
Derivative asset 5 - 18 -
Cash and cash equivalents 129 283 667
Total current assets 2,566 1,385 1,249
Total assets 3,537 2,139 2,522
LIABILITIES
Non-current liabilities
Contingent consideration 6 (67) (141) (172)
Convertible loan notes 8 (1,337) - -
Total non-current liabilities (1,404) (141) (172)
Current liabilities
Trade and other payables 7 (388) (356) (145)
Total current liabilities (388) (356) (145)
Total liabilities (1,792) (497) (317)
NET ASSETS 1,745 1,642 2,204
EQUITY
Share capital 9 62 30 25
Share premium 9 5,264 4,690 3,980
Share option reserve 10 227 227 142
Share warrant reserve 10 60 262 250
Equity component of convertible notes 11 180 - -
Accumulated deficit (4,048) (3,567) (2,193)
TOTAL EQUITY 1,745 1,642 2,204
The Company has elected to take the exemption under section 408 of the
Companies Act 2006, to not present its own profit and loss account. The
Company's total comprehensive loss for the year was £0.7 million (2024: £1.4
million as restated).
The notes to these financial statements on pages 103 to 108 form an integral
part of these financial statements. * For details of restatement please
refer to note 29 to the consolidated financial statements.
These financial statements were approved and authorised for issue by the Board
of Directors on 29 April 2026 and signed on its behalf by:
Louis Ching
Executive Chairman
Company Statement of Changes in Equity
Share Share Share Share warrant reserve Equity component of convertible notes Accumulated Total
Capital premium option deficit equity
reserve
£'000s £'000s £'000s £'000s £'000s £'000s £'000s
Balance at 1 January 2024 25 3,980 142 250 - (2,193) 2,204
Loss for the period (restated*) - - - - - (1,374) (1,374)
Other comprehensive income (restated*) - - - - - - -
Total comprehensive income (restated*) - - - - - (1,374) (1,374)
Net equity issued 5 722 - - 727
Share warrant reserve - (12) 12 - - -
Share option reserve - - 85 - - 85
Balance at 31 30 4,690 227 262 - (3,567) 1,642
December 2024 (restated*)
The notes to these financial statements on pages 103 to 108 form an integral
part of these financial statements. Refer to note 10 for a description of
reserves. * For details of restatement please refer to note 29 to the
consolidated financial statements.
Company Statement of Changes in Equity (continued)
Share Share Share Share warrant reserve Equity component of convertible notes Accumulated Total
Capital premium option deficit equity
reserve
£'000s £'000s £'000s £'000s £'000s £'000s £'000s
Balance at 1 January 2025 (restated*) 30 4,690 227 262 - (3,567) 1,642
Loss for the period - - - - - (683) (683)
Other comprehensive income - - - - - - -
Total comprehensive income - - - - - (683) (683)
Net equity issued 32 574 - - - - 606
Lapsed warrants - - - (202) - 202 -
Issue of convertible loan notes - - - - 180 - 180
Balance at 31 62 5,264 227 60 180 (4,048) 1,745
December 2025
The notes to these financial statements on pages 103 to 108 form an integral
part of these financial statements. Refer to note 10 for a description of
reserves. * For details of restatement please refer to note 29 to the
consolidated financial statements.
Company Statement of Cash Flows
Note 31 Dec 2025 31 Dec 2024
£'000s £'000s
*Restated
Cash flows from operating activities
Loss for the period before taxation (683) (1,374)
Adjustments for:
Finance costs 32 -
Change in fair value of derivative asset 18 (18)
Change in fair value of contingent consideration (74) (32)
Amortisation/depreciation and impairment - 752
Intercompany loan provision 153 -
Share based payment - 85
Foreign exchange (5) -
Decrease in receivables 4 43 60
Increase in payables 7 70 211
Net cash used in operating activities (446) (316)
Cash flows from investing activities
Acquisition of subsidiary, net of cash acquired 3 (1) (232)
Interest received 1 -
Loans provided to subsidiaries 4 (1,748) (563)
Net cash used in investing activities (1,748) (795)
Cash flows from financing activities
Issue of shares for cash, net of costs 9 567 727
Proceeds from issue of convertible loan notes 11 1,500 -
Finance costs (25) -
Net cash from financing activities 2,042 727
Decrease in cash and cash equivalents (152) (384)
Foreign exchange translation differences (2) -
Cash and cash equivalents at beginning of the year 283 667
Cash and cash equivalents at the end of the year 129 283
The notes to these financial statements on pages 103 to 108 form an integral
part of these financial statements. * For details of restatement please
refer to note 28.
Notes to the Company Financial Statements
1. General information
Gem Resources Plc ("the Company" or "GEMR") is domiciled in England and Wales
having been incorporated on 11 January 2005 under the Companies Act with
registered number 05329401 as a public company limited by shares. The
Company's shares were delisted from trading on the AIM Market ("AIM") of the
London Stock Exchange plc on 20 December 2018. On 2 March 2022, the
Company's shares were admitted to what is now the Equity Shares (Transition)
category and to trading on the Main Market of the London Stock Exchange. The
Company changed its name from URA Holdings Plc to Gem Resources Plc on
30 September 2024.
The Company financial statements are required by Companies House and do not
include any intercompany eliminations. The Company financial statements and
note disclosures should be read in conjunction with the Group financial
statements above.
2. Staff Costs (including Directors)
Key management of the Company are considered to be the Directors of the
Company and their accrued remuneration was as follows:
2025 2024
£'000s £'000s
Peter Redmond 40 35
John Treacy 24 24
Edward Nealon 40 43
Bernard Olivier 70 63
Sam Mulligan(1) (24) 40
Louis Ching 32 -
Hans Wong 8 -
Other staff 40 40
Closing balance 230 260
(1) Sam Mulligan resigned on 18 June 2025 and previous accrued fees reversed.
The average monthly number of employees, including the Directors, during the
year was as follows:
2025 2024
Staff/consultants 1 2
Directors 7 5
Total 8 7
Included within staff costs is an amount of £40,000 paid to Jeremy
Sturgess-Smith who is a Key Management Personnel. An amount of £nil (2024:
£34,161) has been charged in respect of unapproved option plan for Jeremy
Sturgess-Smith.
Share based payments
The amount recognised in respect of share-based payments was £nil (2024:
£85,403).
The Group has established share option programmes that entitle certain
employees to purchase shares in the Group.
There are no performance conditions attaching to these options. No options
were exercised in 2025 (2024: Nil).
No new options were issued during 2025 and the total options on issue as at
31 December 2025 amount to 20,000,000 (2024: 20,000,000).
The share options have been valued using the Black Scholes model.
3. Investments in subsidiaries
Cost and net book value 2025 2024
£'000s £'000s
Restated
At beginning of period 754 1,274
Investment in subsidiaries 1 232
Impairment - (752)
Closing balance 755 754
In the prior year, the Company was informed that the renewal of one of its
licences held by Malaika Developments Limited was rejected. Following this,
an appeal was lodged directly with the Minister of Mines and are awaiting a
response. Given the uncertainty around the renewal, the Directors concluded
that an impairment charge in respect of the investment in the Zambia
exploration project was necessary. The estimate was based on the
proportionate size of the licence area not renewed.
The Company's investments at the Statement of Financial Position date in the
share capital of companies include the following:
Subsidiary companies
Name Address of the registered office Nature of business 2025 2024
Proportion of ordinary shares held by parent Proportion of
(%) ordinary shares
held by parent
(%)
Malaika Exploration (Ireland) Limited FDW House, Blackthorn Business Park, Coes Road, Dundalk, Co. Louth, Ireland Exploration 100 100
Malaika Developments Limited** Zambia Exploration 100 100
Gem - Venus Holdings (Pty) Ltd South Africa Investment 100 100
Adit Mining Consultants and Trading (Pty) Ltd** South Africa Mining 74 74
Venus Emeralds (Pty) Ltd** South Africa Exploration 74 74
Prasinus Exploration Pty Ltd Australia Mining 65 65
GemR Corporation Limited Hong Kong Investment 100 -
** Subsidiaries held indirectly through Gem - Venus Holdings Proprietary
Limited and Malaika Exploration (Ireland) Limited.
The Company owns 100% of Malaika Exploration (Ireland) Limited, which owns
100% of Malaika Developments Limited.
On 18 July 2024, the Company acquired 65% of the shares in Prasinus
Exploration Pty Ltd. Refer to note 22 to the consolidated financial
statements for further detail of the acquisition.
4. Other Receivables
2025 2024
£'000s £'000s
Restated
Prepayments 15 30
Sundry debtors - 15
Amounts owed by group companies 2,632 1,021
VAT recoverable 6 18
Closing balance 2,653 1,084
2025 2024
£'000s £'000s
Current assets 2,437 1,084
Non-current assets 216 -
2,653 1,084
The Directors consider that the carrying amount of other receivables is
approximately equal to their fair value. Included in the 2024 sundry debtors
is an amount of £15,000 due by Peter Redmond which was settled in 2025.
Amounts owed by Group companies total £2,632,000 as at 31 December 2025
(2024: £1,021,000) and are classified as financial assets measured at
amortised cost under IFRS 9. These balances arise from unsecured intra-group
transactions and funding arrangements. A loan was provided to Adit Mining
bearing interest at the prime interest rate quoted by Absa Bank Limited
compounded monthly and is repayable by 31 December 2030 or such date as may be
agreed. Apart from the Adit Mining loan, the loans are interest-free with no
fixed repayment terms, making them repayable on demand. The receivables have
been assessed as current assets based on management's expectation of repayment
timing. Due to slower than planned ramp at Prasinus Exploration Pty Ltd and
the licence expiry at Malaika Developments Limited shortly after year end
(pending renewal), management has provided for the full amounts outstanding by
the Australian and Zambian projects of £153,000 (2024: nil).
5. Derivative asset
Disclosures in relation to the derivative asset are shown in note 12 to the
Consolidated Financial Statements.
6. Contingent consideration
Disclosures in relation to the contingent consideration are shown in note 14
to the Consolidated Financial Statements.
7. Trade and other payables
2025 2024
£'000s £'000s
Trade payables 36 124
Other payables - 17
Accruals 352 215
Closing balance 388 356
The Directors consider that the carrying amount of trade payables approximates
to their fair value. Accruals predominantly comprise audit fee accrual of
£83,000 (2024: £88,000) and accrued and unpaid directors and salaries of
approximately £244,000 (2024: £125,000).
8. Convertible loan notes
Disclosures in relation to convertible loan notes are shown in note 18 to the
Consolidated Financial Statements.
9. Share capital
Details of the Company's authorised, called-up and fully paid share capital
are set out in note 19 to the Consolidated Financial Statements.
The ordinary shares of the Company carry one vote per share and an equal right
to any dividends
declared.
10. Reserves
The following describes the nature and purpose of each reserve:
Share option reserve
This represents the amounts charged on share options that have been granted to
employees and directors less amounts transferred on exercise or lapse.
Share warrant reserve
This represents amounts charged on share warrants granted to service providers
less amounts transferred on exercise or lapse.
Equity component of convertible loan notes reserve
The reserve for convertible loan notes comprises the amount allocated to the
equity component for the convertible loan notes issued by the Company in
September 2025.
11. Equity component of convertible notes
2025 2024
£'000s £'000s
Opening balance - -
Equity component of convertible notes 180 -
Closing balance 180 -
In September 2025, the Company issued unsecured convertible loan notes in the
principal amount of £1.5 million ("Convertible Loan Notes") to Louis Ching.
The Convertible Loan Notes are convertible at £0.003 per share and carry a 5%
annual interest, payable semi-annually in arrears on 30 June and 31 December
each year and may be converted at any time up until 3 September 2028. Any
portion of the loan not converted must be repaid in full at maturity together
with accrued interest.
As the conversion feature results in the conversion of a fixed amount of
stated principal into a fixed number of shares, it satisfies the 'fixed for
fixed' criterion and, therefore, it is classified as an compound financial
instrument comprising liability and equity components which requires the
valuation of the liability component and the equity conversion component. The
fair value of the liability component, included in current borrowings, at
inception was calculated using a market interest rate for an equivalent
instrument without conversion option. The discount rate applied was 10%.
12. Contingent consideration
Financial assets and liabilities by category
2025 2024
£'000s £'000s
Restated
Carrying amount of financial assets
Current
Measured at amortised cost
- Other receivables - 15
- Cash and cash equivalents 129 283
Non-current
Measured at fair value through profit or loss
- Derivative asset - 18
129 316
2025 2024
£'000s £'000s
Restated
Carrying amount of financial liabilities
Current
Measured at amortised cost
- Trade and other payables 388 356
Non-current
Measured at amortised cost
- Convertible debt 1,337 -
Measured at fair value through profit or loss
- Contingent consideration 67 141
1,792 497
13. Related party transactions
Director's remuneration is disclosed in note 3 to the Company Financial
Statements.
Further disclosures in relation to the related party transactions are shown in
note 24 to the Consolidated Financial Statements.
14. Prior period adjustments
Disclosures in relation to prior period adjustments are shown in note 28 to
the Consolidated Financial Statements.
15. Events after the period end date
Disclosures in relation to events after 31 December 2025 are shown in note 26
to the Consolidated Financial Statements.
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