REG-Report on Payments to Governments

Kenmare ResourcesAnnouncement

14/05/2025 07:00

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Kenmare Resources plc
(“Kenmare” or “the Company” or “the Group”)

14 May 2025

Report on Payments to Governments

Kenmare Resources plc (LSE:KMR, ISE:KMR), one of the leading global producers
of titanium minerals and zircon, which operates the Moma Titanium Minerals
Mine (the "Mine" or "Moma") in northern Mozambique, announces the publication
of its Report on Payments to Governments.

Introduction

This report details payments to governments made by Kenmare Resources plc (the
“Company”) and its subsidiary undertakings (the “Group”) for the
financial year ended 31 December 2024.

This report has been prepared in accordance with the requirements of Part 2A
of the Transparency (Directive 2004/109/EC) Regulations, 2007 (as amended)
(“Part 2A”), Part 26 of the Companies Act 2014 (“Part 26”) and rule
DTR 4.3A of the UK Financial Conduct Authority’s Disclosure Guidance and
Transparency Rules (“DTR 4.3A”). Part 2A and Part 26 enact in Ireland
domestic rules in line with Directive 2013/34/EU (the “EU Accounting
Directive (2013)”) and apply to large Irish incorporated companies, like the
Company, that are involved in the exploration, discovery, development, and
extraction of minerals. DTR 4.3A imposes equivalent requirements on issuers,
like the Company, admitted to trading on the London Stock Exchange that are
similarly involved in the exploration, development and extraction of minerals.

About Kenmare Resources plc

Kenmare Resources plc is an Irish incorporated company with a premium listing
on the London Stock Exchange and a secondary listing on Euronext Dublin.
Kenmare operates the Moma Titanium Minerals Mine (the “Moma Mine”), which
is located on the northern coast of Mozambique. Moma is one of the world’s
largest producers of titanium minerals, accounting for production of
approximately 6% of global titanium feedstocks and supplying to customers
operating in over 15 countries. The Group’s products are key raw materials,
ultimately consumed in everyday quality-of-life products such as paints,
plastics, and paper.

The Group consists of the parent company (Kenmare Resources plc) and its
subsidiary undertakings. The mining operations at the Moma Mine are carried
out by the Mozambique branch of Kenmare Moma Mining (Mauritius) Limited
(“KMML”) and downstream processing is undertaken by the Mozambique branch
of Kenmare Moma Processing (Mauritius) Limited (“KMPL”), both of which are
wholly-owned subsidiary undertakings of the Company. KMML and KMPL account for
100% of the Group’s turnover and 99% of the Group’s total assets.
Therefore, all revenues and operating costs of the Group’s mining and
processing operations are recorded by KMML and KMPL within the same tax
jurisdiction, namely Mozambique.

The parent company, Kenmare Resources plc, conducts no direct exploration or
mining activities. The Group’s corporate costs are recorded by the parent
company.

Scope of report

Disclosure of payments to governments is required in respect of payments
arising from the exploration, discovery, development and extraction of
minerals; the payments included within this report therefore relate to the
Group’s mining and processing activities at the Moma Mine in Mozambique.

Groups are required to prepare a consolidated report disclosing payments made
by the parent company and its subsidiary undertakings. Accordingly, this
report reflects payments made by the Group companies conducting mining and
processing activities, namely KMML and KMPL. The Group owns 100% of these
entities and the amounts reflect 100% of the payments made by these subsidiary
undertakings.

For a broader discussion of the Group’s payments to governments and its
contribution to its host communities, please see the Group’s 2024
Sustainability statement within our 2024 Annual Report, available on the
Company’s website at
www.kenmareresources.com/investors/reports-presentations-webcasts

Payments

The payments disclosed in this report are on a cash basis.

The payments made to governments are required to be analysed into the
following categories:
* Production entitlements - this category includes the host government’s
share of production, which is usually outlined in a production sharing
agreement. In 2024, the Group did not make relevant payments in this category.


* Taxes - this category includes taxes paid to governments on income, profits
or production arising from the Group’s exploration, discovery, development
and extraction of minerals. Taxes levied on consumption such as value added
taxes, personal income taxes and sales taxes are excluded. KMML is subject to
a corporation tax rate of 35% of the taxable profits of its Mozambique branch.
Taxable profits of the branch are calculated by reference to the cash costs of
producing Heavy Mineral Concentrate (“HMC”) net of allowable tax
deductions and increased by a defined margin.
KMML’s Mozambique branch produces one product from its mining activities,
namely HMC. HMC is sold to KMPL, which processes it into finished products
(ilmenite, zircon, rutile and concentrates), which are exported worldwide to
third party customers. The cash costs of mining include the costs of mine face
preparation, dredging and dry mining operations, Wet Concentrator Plant
operations, rehabilitation and support services.

The margin applied to the cash costs of mining is stipulated in the Mineral
Licensing Contract, dated 21 January 2002. The contract is between KMML and
the Ministry of Mineral Resources and Energy (MIREME) of the Republic of
Mozambique, acting for and on behalf of the Government of the Republic of
Mozambique, which details the terms and conditions for the exploration,
development and production of heavy minerals in the areas of Moma, Congolone
and Quinga. The margin is determined by dividing the prices for sale of
finished products to third party customers earned by KMPL in the year by the
prices earned in the prior year, adjusted for inflation and applying this
factor to the prior year margin. For the fiscal year ending 31 December 2024
the margin was 50.5%.

KMPL has the benefit of operating within an Industrial Free Zone (“IFZ”)
and as an IFZ company, it is exempted from corporation tax.
* Royalties – this category includes payments to a government for the rights
to extract minerals or other materials. Typically amounts are levied based on
production levels or revenues. KMML is subject to a mining royalty of 3% based
on HMC sold to KMPL. The royalty is calculated by multiplying the cash costs
of producing HMC, plus the margin as detailed above, by 3%.
KMPL is subject to a revenue royalty of 1% on revenue recognised.
* Dividends - this category includes dividend payments other than dividends
paid to a government as an ordinary shareholder of the Company or one of its
subsidiary undertakings. In 2024, the Group did not make relevant payments in
this category.


* Bonuses - this category includes bonuses paid to a government for and in
consideration of signature, discovery, production, awards, grants and
transfers of extraction rights and production bonuses. In 2024, the Group did
not make relevant payments in this category.


* Fees – this category includes licence fees, rental fees, entry fees and
other considerations for mining licences or concessions.


* Infrastructure improvements – this category includes payments to
governments for infrastructure other than in circumstances where the
infrastructure is expected to be primarily dedicated to operational activities
throughout its useful life. Payments that form part of the Group’s social
investment activities (which are primarily organised and administered by
Kenmare Moma Development Association) are excluded. Such payments would
include contributions in respect of local schools, healthcare or community
facilities, or improvements to the general environment of local communities.
Government

“Government” means any national, regional or local authority of a country,
and includes a department, agency or undertaking that is a subsidiary
undertaking where the authority is the parent undertaking.

All payments referred to this report are made to the Government of Mozambique
or its agencies; in particular, they are made to Autoridade Tributária
Unidade dos Grandes Contribuintes–Nampula, a department of the Mozambican
tax authority.

Analysis by project/entity

An analysis of payments by project is required where payments are attributable
to specific projects. Projects are defined as operational activities which are
governed by a single contract, licence, lease, concession or similar legal
agreement, and form the basis for payment liabilities with a government. Where
agreements are substantially interconnected in operating and geographical
terms, with substantially similar terms, those agreements should be treated as
a single project. Payments may be disclosed at an entity level where payments
are made in respect of obligations imposed at that entity level rather than at
a project level. Payments below are disclosed at the entity level for KMML and
KMPL, which between them operate the Moma Mine, which is treated as one
project for purposes of this Report.

Materiality

Under Part 2A and Part 26, a payment need not be disclosed if it is a single
payment of less than the equivalent of €100,000 or a series of related
payments in a single year whose total is less than the equivalent of
€100,000. Under DTR 4.3A, a payment need not be disclosed if it is a single
payment of less than the equivalent of £86,000 or a series of related
payments in a single year whose total is less than the equivalent of £86,000.

Currency and rounding

All monetary amounts in this report refer to United States dollars unless
otherwise indicated. The amounts shown in this report have been rounded to the
nearest $1,000.

Payments to Governments – 2024

                           Production entitlements  Taxes    Royalties  Dividends  Bonuses  Fees     Infrastructure improvements  Total    
                           $’000                    $’000    $’000      $’000      $’000    $’000    $’000                        $’000    
 Country summary                                                                                                                           
 Government of Mozambique  -                        9,921    10,087     -          -        315      -                            20,323   
 Total                     -                        9,921    10,087     -          -        315      -                            30,323   
                                                                                                                                           
 Entity report                                                                                                                             
 KMML                      -                        9,921    5,940      -          -        315      -                            16,176   
 KMPL                      -                        -        4,147      -          -        -        -                            4,147    
 Total                     -                        9,921    10,087     -          -        315      -                            20,323   

This report for Kenmare Resources plc (registered number 37550) was approved
by the Directors of the Company on 13 May 2025 and signed on their behalf by

Tom Hickey        
Director        

For further information, please contact:

Kenmare Resources plc
Katharine Sutton
Investor Relations
ir@kenmareresources.com
Tel: +353 1 671 0411
Mob: +353 87 663 0875

Murray (PR advisor)
Paul O’Kane
pokane@murraygroup.ie
Tel: +353 1 498 0300
Mob: +353 86 609 0221

About Kenmare Resources

Kenmare Resources plc is one of the world's largest producers of mineral sands
products. Listed on the London Stock Exchange and the Euronext Dublin, Kenmare
operates the Moma Titanium Minerals Mine in Mozambique. Moma's production
accounts for approximately 6% of global titanium feedstocks and the Company
supplies to customers operating in more than 15 countries. Kenmare produces
raw materials that are ultimately consumed in everyday quality-of life items
such as paints, plastics and ceramic tiles.

All monetary amounts refer to United States dollars unless otherwise
indicated