REG - Strategic Minerals - Final Results
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RNS Number : 0797N Strategic Minerals PLC 17 June 2025
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018.
17 June 2025
STRATEGIC MINERALS PLC
("Strategic Minerals" or the "Company")
FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2024
Strategic Minerals Plc (AIM: SML; USOTC: SMCDF), an international mineral exploration and production company, announces its results for the year ended 31 December 2024 (the "Period").
Financial Highlights
· Revenues increased by approximately 200% to $4.7m (2023: $1.6m) -
the strongest performance since 2017, following the return of a major client
to the Cobre magnetite operation.
· Increased revenue drove operating profitability with pre-tax
profit of $2.1m (2023: loss $9.1m).
· Profit after tax $1.3m (2023: loss $9.2m).
· Invested $531k in development projects.
· Cash at 31 December 2024 increased to $621k (2023: $112k).
· Post year-end, the Company raised gross proceeds of £1m through
a share placement to accelerate development of the Redmoor Tungsten-Tin-Copper
Project in Cornwall.
Operational Highlights (By Subsidiary)
Southern Minerals Group LLC ("SMG")
Cobre magnetite stockpile, New Mexico, USA
· Revenue recovery following return of a major client with a 45,000
tonne purchase order, and a new client with a purchase order for between 5,000
and 7,000 tonnes per annum.
· Sold 70,658 tonnes (2023: 17,965 tonnes) of magnetite product
with full-year revenue of $4.7m (2023: $1.6m).
· Secured a new significant purchase order of up to 30,000 tonnes
from one of SMG's major clients for 2025.
· Secured an extension of access to the Cobre magnetite operation's
stockpile from 31 March 2027 to 31 March 2029.
Cornwall Resources Limited ("CRL")
Redmoor Tungsten-Tin-Copper Project, Cornwall, UK
· Three- year Exclusivity and Prospecting Agreement secured with
The Duchy of Cornwall, expanding its mineral rights footprint in East Cornwall
and the Tamar Valley nearly fourfold to 87.95 km² - rights to explore all
ores and minerals, excluding Crown and reserved assets.
· Commenced re-logging and sampling of historic drill core from
within the Tamar Valley Licence Area ("TVLA").
· Received positive assay results identifying four new mineralised
zones and high-grade tungsten, copper and tin intercepts within and beyond the
Redmoor deposit's Mineral Resource Estimate.
· Participated in the United Kingdom Research and Innovation funded
Green Economy Centre at the University of Exeter, focusing on sustainable
extraction of critical minerals including tungsten, tin and lithium.
· The UK Criticality Assessment 2024, released in November,
reaffirmed tungsten and tin as critical minerals, strengthening the project as
a key potential supply source, well positioned for expected supply and demand
imbalances.
· Post year-end, CRL secured over £764k of matched grant funding
investment from the UK Government, through its UK Shared Prosperity Fund,
managed by the Cornwall and Isles of Scilly Good Growth Project, and is now
advancing its fully funded project activities.
Leigh Creek Copper Mine Pty Ltd ("LCCM")
Leigh Creek Copper Project, South Australia
· Throughout the year the Directors marketed to and followed up
with potential co-investors in or purchasers of LCCM.
· Post year-end, the Company signed a non binding heads of
agreement to grant a purchaser a call option to acquire LCCM, which has been
taken up as detailed further below.
Board Changes
· Appointed Charles Manners and Mark Burnett to the Board as
Non-Executive Chairman and Non-Executive Director respectively - with Mark
Burnett subsequently becoming an Executive Director.
· Alan Broome AM and John Peters retired from the Board as Chairman
and Managing Director respectively.
Charles Manners, Non-Executive Chairman, commented:
"I look forward to progressing our key strategic goals in 2025 as we seek to
maximise outputs from the fully funded activities at Redmoor including
producing an updated MRE with data flowing through to an updated economic
model. By the time of our next annual report, we expect to have formed an
investment ready business case for mining at Redmoor.
It is worth noting that the most recent MRE at Redmoor was completed in 2019,
and the economic assessment, as part of CRL's internal Scoping Study, was
undertaken in 2020. Since then, there have been significant shifts in global
markets and commodity prices, with increased recognition of the importance of
critical minerals. The Company believes that Redmoor's resource stands out in
comparison to most tungsten projects due to the high-grade of tungsten
mineralisation, alongside the presence of tin and copper.
With activities underway, we look forward to a significant increase in news
output from Redmoor as well as a continued strong performance from Cobre."
For further information, please contact:
Strategic Minerals Plc +44 (0) 207 389 7067
Mark Burnett
Executive Director
Website: www.strategicminerals.net (http://www.strategicminerals.net)
Email: info@strategicminerals.net (mailto:info@strategicminerals.net)
Follow Strategic Minerals on:
X: @StrategicMnrls (https://x.com/StrategicMnrls)
LinkedIn: https://www.linkedin.com/company/strategic-minerals-plc
(https://www.linkedin.com/company/strategic-minerals-plc)
SP Angel Corporate Finance LLP +44 (0) 20 3470 0470
Nominated Adviser and Broker
Matthew Johnson/Charlie Bouverat/Grant Barker
Zeus Capital Limited +44 (0) 203 829 5000
Joint Broker
Harry Ansell/Katy Mitchell
Vigo Consulting +44 (0) 207 390 0234
Investor Relations
Ben Simons/Peter Jacob/Anna Sutton
Email: strategicminerals@vigoconsulting.com
(mailto:strategicminerals@vigoconsulting.com)
Notes to Editors
About Strategic Minerals Pls and Cornwall Resources Limited
Strategic Minerals Plc (AIM: SML; USOTC: SMCDY) is an AIM-quoted, producing
minerals company, actively developing strategic projects in the UK, United
States and Australia.
In 2019, the Company completed the 100% acquisition of Cornwall Resources
Limited and the Redmoor Tungsten-Tin-Copper Project.
The Redmoor Project is situated within the historically significant Tamar
Valley Mining District in Cornwall, United Kingdom, with a JORC (2012)
Compliant Inferred Mineral Resource Estimate published 14 February 2019:
Cut-off (SnEq%) Tonnage (Mt) WO(3) Sn Cu Sn Eq(1) WO(3) Eq
% % % % %
>0.45 <0.65 1.50 0.18 0.21 0.30 0.58 0.41
>0.65 10.20 0.62 0.16 0.53 1.26 0.88
Total Inferred Resource 11.70 0.56 0.16 0.50 1.17 0.82
1 Equivalent metal calculation notes; Sn(Eq)% = Sn% x 1 + WO3% x 1.43 + Cu% x
0.40. WO(3)(EQ)% = Sn% x 0.7 + WO(3) + Cu% x 0.28. Commodity price
assumptions: WO3 US$ 33,000/t, Sn US$ 22,000/t, Cu US$ 7,000/t. Recovery
assumptions: total WO3 recovery 72%, total Sn recovery 68% & total Cu
recovery 85% and payability assumptions of 81%, 90% and 90% respectively
More information on Cornwall Resources can be found at:
https://www.cornwallresources.com (https://www.cornwallresources.com)
In September 2011, Strategic Minerals acquired the distribution rights to the
Cobre magnetite project in New Mexico, USA, through its wholly owned
subsidiary Southern Minerals Group. Cobre has been in production since 2012
and continues to provide a sustainable revenue stream for the Company.
In March 2018, the Company completed the acquisition of the Leigh Creek Copper
Mine situated in the copper rich belt of South Australia. The Company
continues seek opportunities to monetise the asset and has signed a
non-binding Heads of Agreement to grant an option to acquire the project.
About the CIOS Good Growth Fund and UK Shared Prosperity Fund
This project is part-funded by the UK Government through the UK Shared
Prosperity Fund. Cornwall Council is responsible for managing projects
funded by the UK Shared Prosperity Fund through the Cornwall and the Isles of
Scilly Good Growth Programme (https://ciosgoodgrowth.com/) .
Cornwall and Isles of Scilly has been allocated £184 million for local
investment through the Shared Prosperity Fund
(https://www.gov.uk/government/publications/uk-shared-prosperity-fund-prospectus/uk-shared-prosperity-fund-prospectus)
. This new approach to investment is designed to empower local leaders and
communities, so they can make a real difference on the ground where it's
needed the most.
UK Shared Prosperity Fund
The UK Shared Prosperity Fund proactively supports delivery of the
UK-government's five national missions: pushing power out to communities
everywhere, with a specific focus to help kickstart economic growth and
promoting opportunities in all parts of the UK.
For more information, visit
https://www.gov.uk/government/publications/uk-shared-prosperity-fund-prospectus
(https://www.gov.uk/government/publications/uk-shared-prosperity-fund-prospectus)
For more information, visit https://ciosgoodgrowth.com
(https://ciosgoodgrowth.com)
STRATEGIC MINERALS PLC
CHAIRMAN'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
2024 was the Company's strongest performance since 2017 following the return
of a major client to the Cobre magnetite operation in New Mexico.
As the new Chairman, I believe the Company is well placed to realise the
underlying value built up in its projects, in particular its Redmoor
Tungsten-Tin-Copper Project which has the potential to be of strategic
importance.
Financial results
With sales at Cobre exceeding our previous expectations, the Company ended the
year with impressive operational and financial results, with annual magnetite
sales at Cobre of 70,658 tonnes (2023:17,965 tonnes), exceeding guidance, with
full-year revenue at $4.7m (2023: $1.6m) and year-end cash balances improving
to $0.62m.
We are confident of continued positive momentum for 2025, supported by a
significant purchase order of up to 30,000 tonnes of magnetite product from a
major client of Southern Minerals Group LLC ("SMG") and the extension of
access to the Cobre magnetite stockpile in New Mexico into 2029.
Cornwall Resources Limited
Redmoor Tin-Tungsten-Copper Project
During the year, the team at Redmoor developed a strategy to re-examine
previous 2017 and 2018 drill core to significantly strengthen the
understanding of the existing JORC (2012) compliant Mineral Resource Estimate
("MRE"), concluded significant mineral rights agreements with The Duchy of
Cornwall and continued to apply for grant funding from the Shared Prosperity
Fund and other sources.
In detail, the team conducted the following activity:
- Further historic relogging and sampling on Redmoor's library of 14,000m of
drill core, identifying four new mineralised zones and high-grade tungsten,
tin, and copper intercepts within and beyond the Redmoor Deposit's Mineral
Resource Estimate.
- Expanding its mineral rights footprint in East Cornwall and the Tamar
Valley nearly fourfold to 87.95km² under an Exclusivity and Prospecting
Agreement with The Duchy of Cornwall.
- Field sampling and identification of potential exploration opportunities
on the recently acquired Duchy of Cornwall licence.
- Continuing involvement in, and advancing new, collaborative research
funding opportunities with Camborne School of Mines and the Cornish mining
community.
- Gaining membership of the US Defense Industry Base Consortium (DIBC)
(Completed) and attending the DIBC symposium, in San Diego (Completed), which
outlined the format and nature of current Defense Production Act Investment
(DPAI) funding opportunities made available via White Papers open
announcements from the Department of Defense for strategic and critical
minerals projects.
- Preparing and submitting a White Paper application to an open announcement
via the DIBC.
- Continuing engagement with Government, the Critical Minerals Association,
and other parties on the upcoming Critical Minerals List refresh, emphasising
Redmoor's tungsten, copper and tin prospects.
- Attending Mines and Money conference in December 2024, as part of a
"Cornish Pavillion" of Southwest-based mining development projects and
representatives, to promote CRL and the growing importance of critical
minerals mining to the Cornish and U.K. economy.
- Hosting site visits by investors, research analysts and various other
counterparties and stakeholders.
- Hosting local community and stakeholder updates.
Southern Minerals Group LLC
Cobre Operations
The substantial increase in demand at Cobre in New Mexico, associated with the
return of its major client, has resulted in the best annual sales revenue
since 2017. The Directors continue to progress negotiations in relation to
demand and are confident that revenue levels will remain stable to elevated
throughout 2025.
The SMG claim against CV Investments ("CVI") was ongoing in 2024. SMG's
initial arbitrated claim was for $21.9m for CVI not fulfilling its contract to
take magnetite. However, the Receiver for CVI denied this on the basis that
SMG was a creditor and that, as CVI received its funding through proceeds of
crime (fraud),( SMG would rank behind those impacted by the crime.
Accordingly, SMG has reduced its claim to $160k.The receiver for CVI did not
make a distribution to claimants in 2024 and any payment in 2025 in relation
to the SMG's claim against CVI is expected to be small.
Leigh Creek Copper Mine Pty Ltd
Leigh Creek Copper Project
Throughout 2024, the Company worked with several parties who expressed an
interest in investing in or acquiring Leigh Creek Copper Mine Pty Ltd ("LCCM")
in South Australia.
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days (subsequently extended by 14 days)
from 23 April 2025 (or such further period as may be agreed by the parties),
for an exclusive call option to acquire 100% of LCCM (the "Call Option").
Under the Call Option, which will be exercisable for a period of six months
(or such longer period as may be agreed by the parties), the purchaser may
elect to acquire 100% of LCCM for an initial payment to Strategic
Minerals of A$1.9 million in cash.
The purchaser anticipates completing a listing on the Australian Securities
Exchange upon which it will issue shares to Strategic Minerals equivalent to
19.9% of the listed vehicle up to a maximum value limit of A$3 million.
The purchaser will pay an earn-out to Strategic Minerals equivalent to A$4
million to be paid on a half yearly basis from the commencement of commercial
production at the project with each half yearly payment to be the equivalent
of 20% of net free cash flows from the prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
Safety
The Company has a strong focus on safety issues and continues to maintain a
high level of performance when it comes to safety. In 2024 there was one minor
safety issue reported.
I would like to take this opportunity to thank my fellow Directors, our
management and staff in New Mexico, Cornwall and South Australia, along with
our advisers, for their support and hard work on our behalf during the year.
Additionally, I would like to thank our investors, clients, contractors,
suppliers and partners for their continued backing.
Conclusion
I look forward to progressing our key strategic goals in 2025 as we seek to
maximise outputs from the fully funded activities at Redmoor including
producing an updated Mineral Resource Estimate ("MRE") with data flowing
through to an updated economic model. By the time of our next annual report,
we expect to have formed an investment ready business case for mining at
Redmoor.
It is worth noting that the most recent MRE at Redmoor was completed in 2019,
and the economic assessment, as part of CRL's Internal Scoping Study, was
undertaken in 2020. Since then, there have been significant shifts in global
markets and commodity prices, with increased recognition of the importance of
critical minerals. The Company believes that Redmoor's resource stands out in
comparison to most tungsten projects due to the high-grade of tungsten
mineralisation, alongside the presence of tin and copper.
With activities underway, we look forward to a significant increase in news
output from Redmoor as well as a continued strong performance from Cobre.
Charles Manners
Non-Executive Director and Chairman
16 June 2025
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors of the Company and its subsidiaries (which together comprise the
Group) present their Strategic Report on the Group for the year ended 31
December 2024.
Financial Performance
The Company and the Group's reporting currency is US dollars reflecting that,
previously, the Group's revenues, expenses, assets and liabilities were
predominantly in US currency and, currently, the bulk of revenues continue to
be sourced in US dollars.
The Group recorded a profit before tax including discontinued operations tax
of $1.996m (2023 loss: $9.082m).
The Board strengthened its policy to ensure overheads and administration costs
are appropriately in line with cash flows from operations. Revenue grew from
$1.577m in 2023 to $4.745m in 2024 an increase of approximately 200%. Overhead
expenses for 2024 were $1.726m (2023: $1.455m) and represented a modest
increase of 19%.
On the back of strong revenue growth, SMG incurred a tax expense of $0.691m
(2023 $0.073m) for the year.
The Company continued to invest in moving both the Leigh Creek Copper and
Redmoor Tungsten-Tin-Copper Projects forward. In 2024, the Company invested
$0.531m in such activities (2023: $0.569m).
Included in the amount for trade payables are the following amounts owed to
Directors and key management personnel or their related parties:
At 31 Dec 24 At 31 Dec 23
USD $'000
USD $'000
John Peters - 206
Alan Broome 20 70
Peter Wale - 52
Karen Williams - CFO - 38
Total 20 366
Cash at the end of the year was $0.621m (2023: $0.112m).
PROJECT REVIEW AND ACTIVITIES
Cobre performance
In 2024, Cobre revenue reflected the return of its major client, increasing
200% to $4.745m (2023: $1.577m). This increase in demand was managed through
additional site hours.
With access to the stockpile being extended until March 2029 and the
resumption of shipping to the major client, 2024 was a positive year for the
operation and the prospects for 2025 appear to be promising.
In November 2023, the existing President of SMG resigned and was replaced by
the existing Pit Manager Tim Klumker. Tim has been with SMG for over six years
and has, for the past three years, been running operations.
As previously noted, the receiver for CV Investments made no distribution to
claimants in 2024 and any payment in 2025 in relation to the SMG's claim
against CVI is expected to be small.
SMG continues to have an exemplary safety record and has developed an enviable
culture that reinforces the highest safety standards. In 2024, there was one
minor safety incident.
Leigh Creek Copper Mine Pty Ltd ("LCCM")
In 2018, the Company invested in the LCCM project, a historically mined copper
oxide deposit, as part of its desire to acquire a near term cash flow project
exposed to minerals and metals expected to benefit in the future from supply
and demand imbalances, therein providing the Company with a second income
stream.
Since acquisition, the Company has invested in a temporary restart of
operations to test existing operating capacity and in preparing and submitting
a Programme for Environmental Protection and Rehabilitation ("PEPR") in
relation to its Paltridge North deposit. The PEPR was conditionally approved
in 2021 and LCCM undertook the work required to convert the conditional PEPR
to unconditional with additional information being lodged in January 2022.
In July 2022, an unconditional PEPR for the extraction and treatment of copper
oxide material at the Paltridge North deposit was issued. The material planned
to be extracted at Paltridge North is predominately copper oxide but becomes a
transitional copper sulphide ore at the lower part of the planned pit. The
regulatory authorities required further details on the treatment of such
material and in response an additional PEPR, replicating the unconditional
PEPR with data addressing the peculiarities of handling transitional ore, was
lodged in December 2022.
In line with the approval of the unconditional PEPR, the Company followed up
on parties interested in funding the project at the asset level with a view to
a full restart in 2023, subject to receipt of finance. A further PEPR will be
required for the proposed future mining of the Lynda/Lorna Doone deposits and
work on this is expected to be undertaken during the mining and processing of
ore from Paltridge North. The cost and expected timing of these have been
incorporated into the Company's financial modelling of the project.
Throughout 2024, the Company has worked with several parties who have
expressed an interest in investing in or acquiring the asset.
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
- The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days (subsequently extended by 14 days)
from 23 April 2025 (or such further period as may be agreed by the parties),
for an exclusive call option to acquire 100% of LCCM (the "Call Option").
- Under the Call Option, which will be exercisable for a period of six
months (or such longer period as may be agreed by the parties), the purchaser
may elect to acquire 100% of LCCM for an initial payment to Strategic Minerals
of A$1.9 million in cash.
- The purchaser anticipates completing a listing on the Australian
Securities Exchange upon which it will issue shares to Strategic
Minerals equivalent to 19.9% of the listed vehicle up to a maximum value
limit of A$3 million.
- The purchaser will pay an earn-out to Strategic Minerals equivalent to A$4
million to be paid on a half yearly basis from the commencement of commercial
production at the Project with each half yearly payment to be the equivalent
of 20% of net free cash flows from the prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
LCCM has three approved Mining Leases that cover a number of copper oxide
deposits, including Lorna Doone, Lynda, Mountain of Light (Rosmann East and
Paltridge North) and the Mount Coffin deposit. All the Mineral Resources are
contained within the Mining Leases. They contain a JORC 2012 total resource of
3.61mt @ 0.69% copper for 24,900 of contained copper metal which forms the
base of the project and includes the following resource category breakdown.
Inferred Indicated Total Resource
Deposit Tonnes Copper Grade Tonnes Copper Grade Tonnes Copper Grade Copper Metal (tonnes)
Paltridge North 41,000 0.49% 879,000 0.82% 920,000 0.81% 7,400
Lynda - - 1,349,000 0.65% 1,349,000 0.65% 8,800
Lorna Doone 66,000 0.68% 1,280,000 0.65% 1,346,000 0.65% 8,700
Total 107,000 0.61% 3,508,000 0.69% 3,615,000 0.69% 24,900
An existing heap leach and Kennecott cone-based copper processing facility is
located at the Mountain of Light deposit (adjacent to Rosmann East and nearby
Paltridge North) and was successfully operated for a short period in 2019 to
test its capacity to resume full time operations.
The region around the project has excellent infrastructure with a modern town
(Leigh Creek), sealed airstrip, sealed and all-weather roads, power and water
utilities.
In addition to the Mining Leases, two approved Exploration Leases, covering an
area of 686km² in the northern Flinders Ranges, are included in the project.
These provide excellent opportunities for exploration of new copper oxide
resources.
Despite improvements in the economics of the project, associated with higher
copper prices, the previous Board's efforts to secure funding did not result
in a transaction being achieved in 2023. Accordingly, the full book value of
the LCCM project was impaired at 31 December 2023.
As noted above in April 2025, the Company signed a non-binding heads of
agreement for the sale of the Leigh Creek Copper Mine project.
Cornwall Resources Limited - Redmoor Tungsten-Tin-Copper Project
After becoming a 50% owner of the Redmoor Tungsten-Tin-Copper Project in 2016,
SML moved to acquire full control of CRL, the holder of the Project, in 2019.
The move to acquire the balance of CRL was based on the Board's perception of
the value of the acquisition and its preference to secure full control of such
a key asset before the market became fully aware of its potential.
This 2019 resource update demonstrated that the overall Inferred Resource had
increased from the previously assessed 4.5m tonnes at a tin equivalent
("SnEq") of 1.00% to 11.7m tonnes at 1.17% SnEq. The result was a 200%
increase in contained metal, 160% in resource tonnes and a 0.17% rise in the
tin equivalent grade.
Not only has the resource been significantly expanded but, as shown in the
following diagram, the mineralisation has been discovered in discrete
locations giving rise to the ability to tailor mining and processing to
preferred mineralisation at the time of extraction.
The Board considers that CRL holds a significant asset at a time when the
regional potential of the area and its recent extension of the exploration
licence, until 2037, provides the time to develop this fully to the best
benefit of shareholders.
Increases in commodity prices, notably tin and copper, have impacted very
positively on the economics of the Redmoor Project. This, combined with the
world class standing of the Redmoor deposit, augurs well for valuation in the
future. In the Company's last Redmoor Scoping Study report, in October 2020,
commodity prices used were tin $20,000/t (currently c$30,000/t), tungsten
$30,000/t (currently c$32,500 MTU) and copper $3.18 lb (currently c$4.65/lb).
Accordingly, internal analysis shows a significant increase upon the
previously reported after tax NPV(8) of $91m and the IRR of 23.4%.
In late 2024 a revised submission was submitted to secure grant funding from
the Shared Prosperity Fund of the Council of Cornwall and the Isles of Scilly.
In April 2025, CRL finalised grant funding of over £764k with the UK
Government through the UK Shared Prosperity Fund ("SPF").Cornwall
Council is responsible for managing projects funded by the UK Shared
Prosperity Fund through the Cornwall and the Isles of Scilly Good Growth
Programme.
The grant funding, which will be equally matched by Company expenditure up to
a total Project spend of £1.529m, will enable new exploration activities,
including borehole drilling, aimed at accelerating the development of the
Redmoor Tungsten-Tin-Copper Project.
Safety
There was only one minor safety incident in 2024 (2023: one) which occurred at
th US operation, when a machine drove into a pothole caused by inclement
weather, jarring the driver. As a result, the driver was given the rest of the
day off and returned to work the next morning.
Board Changes
Name Position Appointment Date Resignation Date
Charles Manners Non- Executive Chairman 1 September 2024
Mark Burnett Non-Executive Director 1 September 2024 15 November 2024
Executive Director 15 November 2024
John Peters Executive Director 15 November 2024
Alan Broome Chairman 16 July 2024
Peter Wale Executive Director 24 March 2025
Philip Haydn- Slater Non-Executive Director 27 January 2025
Key Risks and Uncertainties
The management of the business and the execution of the Group's strategy are
subject to a number of risks. The Group regularly reviews the principal risks
and uncertainties that the business faces and assesses appropriate responses
to mitigate and, where possible, eliminate potential adverse impact. There is
the possibility that if more than one event occurs, that the overall effect of
such events would compound the possible adverse effects on the Group.
Our principal risks and uncertainties are as follows:
Commodity prices and currency risk
Although the Group's main income stream at Cobre is focused on localised
markets, which minimises the impact of global commodity prices, the value of
its development projects can still be subject to changes in global commodity
prices. Fluctuations in commodity markets are affected by numerous factors
beyond the Group's control, including global demand and supply, international
economic trends, currency exchange fluctuations, expectations for inflation,
speculative activity, consumption patterns and global or regional political
events. The aggregate effect of these factors is impossible to predict.
Fluctuations in commodity prices, over the long term, may adversely impact the
returns of the Group's investments. The Group monitors commodity prices and
structures its portfolio of assets with commodities that are likely to
appreciate in the medium to long term.
The Group reports its results in US Dollars, whilst the functional currency of
the parent company from which the Group derives most of its funding is Pound
Sterling. Fluctuations in exchange rates between currencies in which the Group
invest, reports, or derives income may cause fluctuations in its financial
results that are not necessarily related to the Group's underlying operations.
The Group converts funds to a currency in which funds will be utilised on an
as needed basis.
Funding risk
The Group requires funds, both to manage its working capital requirements and
fund new and existing projects, as the Group seeks to grow. If the Group is
not able to obtain sufficient financial resources, it may not be able to
develop new and existing projects. There can be no assurance that such funds
will continue to be available on reasonable terms, or at all in the future.
The Directors regularly review cash flow expenditure requirements, and the
cash flow generated from its Cobre operation to ensure the Company and Group
can meet financial obligations as and when they fall due.
In 2024, uncertainty in capital markets restricted access to both debt and
equity markets and the Board demonstrated flexibility and financial acumen in
navigating the complexities associated with ensuring cash flow for operations.
Early 2025 indications are that investment market uncertainty is reducing.
Reserve and resource risk
The mineral reserve and resource relating to CRL and LCCM are only estimates
and no assurance can be given that the estimated reserves and resources will
be recovered or that they will be recovered at the rates estimated. Reserve
and resource estimates are based on sampling and, consequently, are uncertain
because the samples may not be representative. Reserve and resource estimates
may require revision (up or down) based on future actual production
experience. The discovery of mineral deposits is dependent upon a number of
factors including the technical skill of the exploration personnel involved.
The commercial viability of a mineral deposit, once discovered, is also
dependent upon several factors, including the size, grade and proximity to
infrastructure, metal prices and government regulations, including regulations
relating to royalties, allowable production, importing and exporting of
minerals, and environmental protection. There can be no guarantee that a
mineral deposit will be economically viable. The Group undertakes studies in
order to mitigate this risk.
Licence and Permitting risk
The exploration, developing and mining of resources is, usually, governed by
licensing and permitting requirements issued, generally, by governments. These
normally cover limited periods and risk may be attached to whether governments
permit these periods to be extended or institute "new" conditions on their
usage. While this is true for all resource projects it has significant
application to SML's two, pre-production assets, namely:
(a) LCCM - The PEPR permitting process provides risk, both to costs
and timing of projects. While the PEPR for mining copper oxide material from
Paltridge North is unconditional, at the time of writing, the variation to
encapsulate the transitional ore expected at the bottom of the planned
Paltridge North pit has also been submitted and is pending approval. There is
also a need for a PEPR for the Lynda/Lorna Doone deposit. Allowance for these
undertakings is reflected in our internal plans and valuations but it is
acknowledged that risks to the overall projects value may arise from
variations to expectations around the granting of these PEPRs.
(b) Redmoor - As the planned Redmoor Project is not as advanced as
LCCM, its progress is still dependent on obtaining and maintaining appropriate
approvals. Ultimately, a mining licence will need to be obtained. However, for
the present, the principal focus is on the current fully funded project
activities including drilling.
Customer risk
The level of profitability of the Group is currently dependant on the
performance of the Group's Cobre operation in the United States. The Cobre
operation has several major customers and should one or more of these
customers choose to not to purchase product it may have a substantial impact
on the performance of the Group. The Group continues to look for additional
customers at Cobre to address this risk and in addition will develop other
projects such as Redmoor to reduce the risk of dependence on any one customer.
Operational and Environmental risk
Mining operations are subject to hazards normally encountered in exploration,
development, and production. These include unexpected geological formations,
rock falls, flooding, dam wall failure and other incidents or conditions which
could result in damage to plant or equipment, people, or the environment and
which could impact any future production throughput. Although it is intended
to take adequate precautions to minimise risk, there is a possibility of a
material adverse impact on the Group's operations and its financial results.
The Group will develop and maintain policies appropriate to the stage of
development of its various projects. In 2020, as a safeguard to both our
clients and staff, amendments were made to operational procedures to ensure
that delivery of material was contactless. These procedures have continued as
standard practice.
Strategic risk
Significant and increasing competition exists for mineral acquisition
opportunities throughout the world. As a result of this competition, the Group
may be unable to acquire rights to exploit additional revenue generative
assets such as Cobre and attractive mining development properties such as
Redmoor and LCCM on terms it considers acceptable. Accordingly, there can be
no assurance that the Group will acquire any interest in additional operations
that would yield reserves or result in commercial mining operations. The Group
expects to undertake sufficient due diligence to help ensure opportunities are
subjected to proper evaluation.
Uninsurable risk
The Group may become subject to liability for accidents, pollution, and other
hazards against which it cannot insure or against which it may elect not to
insure because of prohibitive premium costs or for other reasons, such as
amounts which exceed policy limits.
Product risk
The Group has a contract for access to magnetite iron ore at the Cobre
operation until March 2029. There is a risk that the supplier may terminate
the agreement, after this time, in which case the Group would no longer have
product to sell. The Group's proactive approach in securing access for the
next four years has minimised the impact this risk may have on future
operations and the Group's management actively engages with its supplier
throughout the year to proactively address any concerns that the supplier may
raise.
An off-take arrangement remains in place for the LCCM project which is subject
to minimum product specifications. During 2019 the Group was able to produce
at specification material in its retreatment of heaps thereby substantially
reducing the product specification risk. No further product has been produced
since 2019.
Dependence on key personnel risk
The Group and Company are dependent upon the executive and local management
teams. Whilst it has entered into contractual agreements with the aim of
securing the services of these personnel, the retention of their services
cannot be guaranteed. The development and success of the Group depends on the
Company's ability to recruit and retain high quality and experienced staff.
The loss of the service of key personnel or the inability to attract
additional qualified personnel as the Group grows could have an adverse effect
on future business and financial conditions. The Group incentivises executives
and management with market-based remuneration packages, short term and
long-term incentive schemes.
Climate Change Risk
While climate change considerations can seriously impact resource companies,
the Group considers that there is little downside risk from these
considerations, given the metals and minerals in its portfolio, and that these
climate change considerations are likely to impact positively on commodity
prices for both copper and tin.
Ongoing War Risk
The ongoing Russia- Ukraine and Middle-East conflicts continue to raise the
possibility of a global conflict. To date, these actions have generally
positively impacted on resource prices relevant to SML. However, there is
risk, that global economic growth may be severely curtailed, and this would,
ultimately, have a negative impact on the demand for resources.
Key Performance Indicators
The Board monitors the activities and performance of the Group on a regular
basis. The principal KPI's monitored by the Group are domestic sales of
product from Cobre, the cash position of the Group, the investment in project
activities, the share price of the Group and the health, safety, and
environmental incidents of the Group.
The sales of domestic product at Cobre were significantly improved in 2024,
due to a return of sales to the largest client. Revenue in 2024 was $4.745m
(2023: $1.577m).
The unrestricted cash position of the Group as of 31 December 2024 was $0.621m
which increased from $0.112m from the previous year. This increase in cash
reflects the operating profit generated during the year, less the investments
made into the LCCM and Redmoor projects as detailed in the Group Statement of
Cash Flows.
The share price of the Company at year end was 0.25p (2023: 0.10p).
The Group had only one minor health and safety or environmental incident
during the year, (2023: one).
Strategy
In early 2016, the Group adopted a strategy emphasising both an operating and
investment strategy which continues today.
The operating strategy is centred on maintaining and improving cash flows from
the Group's magnetite stockpile at the Cobre mine in New Mexico, USA, whilst
also limiting corporate overheads in line with this profitability, thus
ensuring operating self-sufficiency.
The investment strategy is built around investment in projects that relate to
metals expected to increase in demand and price over the medium term.
Outlook and Prospects
The Group will continue its policy, since the arrival of the current Board
members, of maintaining control of its overheads. The Board will also look to
reduce costs by simplifying the group structure, especially by focussed on a
reduction in the number of Australian subsidiaries.
It is focused on a executing a sale of LCCM in 2025 and is looking to expand
Cobre's profitable domestic sales as well as significantly progressing the
Redmoor Tungsten-Tin-Copper Project to a "pre-feasibility" stage.
The Board is confident that the outlook for the Group is encouraging having
weathered testing times since 2020. The Group is actively pursuing further
funding opportunities, both joint venture and debt style, to progress Redmoor.
The low holding cost of this project, the low level of debt in the Group and
the extended access to the Cobre magnetite stockpile to 2029, with its
associated cash flow, provides the Group the flexibility, when considering
financing options, to extract maximum value from this investment.
At Redmoor, the next goal after the ongoing fully funded project activities,
will be the preparation of a pre-feasibility study to be followed by a
bankable feasibility study. Each study is expected to take two to two and a
half years to complete, and the Company has begun to access grant funding to
assist in the completion of the pre-feasibility study.
The robust performance of commodity prices, notably tin, have provided
optimism for the Group.
Directors' section 172 statement
Section 172 of the Companies Act 2006 requires Directors to take into
consideration the interests of stakeholders and other matters in their
decision making. The Directors continue to have regard to the interests of the
Company's employees and other stakeholders, the impact of its activities on
the community, the environment and the Company's reputation for good business
conduct, when making decisions. In this context, acting in good faith and
fairly, the Directors consider what is most likely to promote the success of
the Company for its members in the long term. We explain in this annual
report, and referenced below, how the Board engages with stakeholders.
Likely consequence of any decision in the long term
The Chairman's Statement, Strategic Report Business Strategy and the Corporate
Governance Statement set out the Company's long-term rationale and strategy.
Interests of employees
The Employee section of the Company's Corporate Governance Statement sets out
the Company's approach to the interests of its employees.
Foster business relationships with suppliers, customers, and others
The Company's approach to business relationships with stakeholders and
shareholders are set out in the Company's Corporate Governance Statement.
Community and environment
The Company's approach to the community is set out in the Corporate Governance
Statement.
Maintain high standards of business conduct
The Corporate Governance Statement sets out the Board and Committee structures
and extensive Board and Committee meetings held during 2024, together with the
experience of executive management and the Board and the Company's policies
and procedures.
Act fairly between shareholders
The Corporate Governance Statement sets out the process the Company follows to
ensure it all shareholder interests are preserved and enhanced.
Principal Decisions made by the Board
We define principal decisions as both those that have long-term strategic
impact and are material to the Group, but also those that are significant to
our key stakeholder groups. In making the following principal decisions, the
Board considered the outcome from its stakeholder engagement, the need to
maintain a reputation for high standards of business conduct and the need to
act fairly between the members of the Company:
(a) Commitment to sale of Leigh Creek
During late 2024 and early 2025, the Board has concentrated its efforts to
sell LCCM. While the Board is confident that LCCM will be sold, due to the
lack of success in securing a sale, management has assessed that at 31
December 2024, the asset continues to be impaired and an impairment expense of
$0.113m (2023: $8.898m) will be recorded in profit or loss.
(b) Debt management
$721,000 of trade and other payables were paid in 2024, including $346,000 in
amounts owed at 31 December 2023 to Director and key management personnel or
their related parties.
(c) Progression of Redmoor Tungsten-Tin-Copper Project
The Board continues to focus its attention on securing the progress of the
Redmoor Project with minimal parent dilution and considers that the placement
of tin and tungsten on the UK critical minerals list played a significant role
in the Group accessing government grant funding. The grant funding being
sourced does not preclude the Group looking for an appropriately resourced
joint venture partner that could assist in the completion of feasibility
studies.
(d) Limiting of equity raises in line with investment in value added
project progression
The Board has adopted a policy of seeking to limit the Company's capital
raisings, and hence shareholder dilution, as much as possible and to,
generally, ensure that the bulk of funds raised are for value added
purposes/projects.
(e) Commitment to funding operating costs from Cobre cash flows
The Board has adopted a long running strategic objective to maintain corporate
overheads within after tax cash flow generated from its Cobre operations. In
this manner, any dilutive equity issues are directed at, potentially, valuable
accretive investments to progress projects. Whilst this could not be achieved
in 2023 and 2024, the Board is confident this is achievable in 2025.
In making the above principal decisions, the Directors believe that they have
considered all relevant stakeholders, potential impact and conflicts, the
Company's business model and its long-term strategic objectives, and have
acted accordingly to promote the success of the Company for the benefit of its
members as a whole.
The Strategic Report was approved and authorised for issue by the Board of
Directors and was signed on its behalf by:
Mark Burnett
Executive Director
16 June 2025
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors present their report and the audited financial statements for
Strategic Minerals Plc ("the Company") and its wholly owned subsidiaries ("the
Group") for the year ended 31 December 2024.
PRINCIPAL ACTIVITIES, BUSINESS REVIEW AND FUTURE DEVELOPMENTS
The Company is a public limited company registered in the UK whose registered
office is 27/28 Eastcastle Street, London, W1W 8DH.
The principal activity of the Company is a holding company. The principal
activity of the Group is the exploration, development, and operation of mining
projects.
A review of the Group's business during the financial year and its likely
development is given in the preceding Chairman's Report and Strategic Review.
RESULTS AND DIVIDENDS
The Group recorded a profit after taxation for the year of $1.305m (2023 loss:
$9.155m).
The Directors do not propose to recommend any distribution by way of dividend
for the year ended 31 December 2024.
DIRECTORS
The Directors who served the Company during the period and to the date of this
report were as follows:
Current Directors
Mark Burnett (appointed 1 September 2024)
Charles Manners (appointed 1 September 2024)
Peter Wale (appointed 12 July 2016;
resigned 24 March 2025)
Alan Broome (appointed 2 July 2015;
resigned 16 July 2024)
John Peters (appointed 21 January 2015;
resigned 15 November 2024)
Philip Haydn-Slater (appointed 27 January 2025)
DIRECTORS' INTERESTS IN SHARES AND OPTIONS
The persons who held office during the year or at the year-end had the
following interests in share capital and options of the Company as detailed
below.
Director Shares held Shares held
at 31 December 2024
31 December 2023
John Peters 81,000,000 81,000,000
(resigned 15 November 2024)
Peter Wale 80,767,266 80,767,266
Alan Broome 9,172,319 9,172,319
(resigned 16 July 2024)
Charles Manners 91,130,742 91,130,742
(appointed 1 September 2024)
Mark Burnett - -
(appointed 1 September 2024)
No options were held as at the reporting date and as at 31 December 2024
(2023: nil) for all Directors.
DIRECTORS' REMUNERATION AND SERVICE CONTRACTS
Under their respective service contracts, the officers of the Company received
fees as detailed in the Directors' Remuneration table in Note 6.
SHARE CAPITAL
Strategic Minerals Plc is incorporated as a public limited company and is
registered in England and Wales with the registered number 07440902. Details
of the Parent Company's issued share capital, together with details of the
movements during the year, are shown in Note 19.
The Parent Company has one class of Ordinary Share and all shares have equal
voting rights and rank pari passu for the distribution of dividends and
repayment of capital.
The total issued share capital of the Company comprises 2,349,297,949 ordinary
shares of 0.10p each, with one voting right per share. The Company does not
hold any ordinary shares in treasury.
The total number of ordinary shares and voting rights in the Company is
therefore 2,349,297,949.
SUBSTANTIAL SHAREHOLDERS
As at 16 June 2025 shareholdings of 3% or more of the issued share capital
notified to the Company were:
Number of 0.1p ordinary shares Percentage of issued share capital
Charles and Alexandra Manners 91,130,742 3.88
RAB Capital (Phillip Richards) * 81,000,000 3.45
John Peters 81,000,000 3.45
Peter Wale 80,767,266 3.44
*Mark Burnett is an Executive Director and is also Director of Mining
Investments for RAB Capital. Mr Burnett is the RAB Capital representative on
the Board and represents the shareholder interests of RAB Capital/Phillip
Richards.
Based on the total issued share capital of 2,349,297,949 at 16 June 2025.
POLITICAL CONTRIBUTIONS
There were no political contributions made by the Group during the year ended
31 December 2024 (2023: Nil).
INFORMATION TO SHAREHOLDERS - WEBSITE
The Company has its own website (www.strategicminerals.net
(http://www.strategicminerals.net) ) for the purposes of improving information
flow to shareholders, as well as to potential investors.
GOING CONCERN
The Directors have considered the Company's and Group's ability to continue as
a going concern through review of cash flow forecasts prepared by management
for the period to 31 December 2026 and a review of the key assumptions on
which these are based and sensitivity analysis.
The Company and Group forecasts that to have sufficient funds to meet all
operating costs until 31 December 2026, the Company and Group is reliant on
cash being generated from its magnetite revenue. The group does not have
guaranteed revenue for the period to 31 December 2026 and the level of the
group's future revenue and associated cashflow receipts cannot be determined
with any certainty. If the group's major customer does not renew its 2025 and
2026 orders at similar level to the year ended 31 December 2024, then the
group may be required to secure alternative funding over the course of the
next twelve months from the date of signing of the financial statements. The
need to secure this future funding if revenue receipts do not attain a certain
level represents a material uncertainty that may cast significant doubt on the
company's and group's ability to continue as a going concern.
As outlined by the Board, it is intended that any funds required to progress
either the sale of Leigh Creek Copper Mine and/or Redmoor Project will be
sourced at the asset level and the Directors are actively pursuing such
funding.
In May 2025, the Company raised in aggregate, gross proceeds of £1m through
the placing of 333,333,333 new Ordinary Shares to certain investors at a price
of 0.3 pence per share. The net proceeds of the Placing will be
principally used to progress activities at the Company's Redmoor
Tungsten-Tin-Copper Project in Cornwall and for working capital purposes.
The Directors have reasonable expectation that the Company and Group will
continue to have access to sufficient resources by way of debt or equity
markets should the need arise. Consequently, the financial statements have
been prepared on a going concern basis.
The financial statements do 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 Company
and Group not continue as a going concern.
INDEMNITY OF OFFICERS
The Company currently maintains insurance to cover against legal action
brought against its directors and officers. It evaluates on the appointment of
new directors whether an indemnity from the Company for the actions of
previous directors is warranted. However, the Company may purchase and
maintain, for any Director or officer, insurance against any liability in the
near future pending the evolution and complexity of any further new projects
undertaken by the Group.
FINANCIAL RISK MANAGEMENT
Refer to Note 3 to the financial statements for further details.
RESEARCH and DEVELOPMENT
The Redmoor R&D project seeks to further develop and understand the
geology of economically viable resources of contained tungsten, tin and copper
in the area of Kelly Bray, Cornwall, and to develop the associated
technologies required to extract them. Ongoing activities have expanded to
CRL's wider mineral rights license area, including the newly acquired Tamar
Valley Licence Area (licensed in April 2024), to research and understand the
wider mineral potential of the area and the project's environmental baselines.
AUDITORS
Moore Kingston Smith LLP were appointed as auditors of the Company for the
financial year. A resolution to re-appoint Moore Kingston Smith LLP will be
put to the shareholders at the next Annual General Meeting.
EVENTS AFTER THE END OF THE REPORTING PERIOD
Refer to Note 27 to the financial statements for further details.
PUBLICATION OF ACCOUNTS ON COMPANY WEBSITE
Financial statements are published on the Company's website. The maintenance
and integrity of the website is the responsibility of the Directors. The
Directors' responsibility also extends to the financial statements contained
therein.
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the Directors, at the time of approval of their report, are aware:
· there is no relevant audit information of which the Company's
auditors are unaware; and
· the Directors have taken all 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 auditors are aware of that information.
By order of the Board
Mark Burnett
Executive Director
16 June 2025
STATEMENT OF DIRECTORS' RESPONSIBILITIES
FOR THE YEAR ENDED 31 DECEMBER 2024
Directors' responsibilities
The Directors are responsible for preparing the annual report and the
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 the Group
and Company financial statements in accordance with UK adopted International
Accounting Standards. 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 group and company and of the profit or
loss of the group and company for that period.
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 they have been prepared in accordance with UK
adopted International Accounting Standards subject to any material departures
disclosed and explained in the financial statements; and
· prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and the Company will
continue in business.
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 comply with the
requirements of the Companies Act 2006. 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.
Website publication
The Directors are responsible for ensuring the annual report and the financial
statements are made available on a website. Financial statements are published
on the Company's website in accordance with legislation in the United Kingdom
governing the preparation and dissemination of financial statements, which may
vary from legislation in other jurisdictions. The maintenance and integrity of
the company's website is the responsibility of the Directors. The Directors'
responsibility also extends to the ongoing integrity of the financial
statements contained therein.
STRATEGIC MINERALS PLC
CORPORATE GOVERNANCE STATEMENT
Board of Directors
The aim of the Board is to function at the head of the Group's management
structures, leading and controlling its activities and setting a strategy for
enhancing shareholder value. Regular meetings are held to review the Group's
forward planning. The Board currently consists of a Non-Executive Chairman, an
Executive Director, and a Non- Executive Director.
The Directors recognise the importance of sound corporate governance
commensurate with the size and nature of the Company and the interests of its
shareholders and, in 2018, formally adopted The QCA Corporate Governance Code
(the "QCA Code") after noting that it had, effectively, implemented its
content in its previous arrangements.
The QCA Code's application to the Company, as outlined in its corporate
governance statements and disclosures, involves adhering to its principles
while considering various expectations, and explaining any deviations from
these principles. This supports the company's medium to long-term success
by promoting transparency, accountability, and strong governance practices,
which in turn builds investor confidence and fosters a sustainable business
environment.
In addition to the details provided below, governance disclosures can be found
at the company's website at www.strategicminerals.net.
Principle 1: Establish a strategy and business model which promote long-term
value for shareholders
The Board has developed and enunciated a strategy and business model as
detailed on the Company's website at
https://www.strategicminerals.net/company/strategy.
The Board considers the Company's strategy provides a framework for medium to
longer term growth in shareholder value.
The major risks to the Company's overall strategy stem from the potential
failure to maintain access to the Cobre magnetite stockpile and overextending
its cash requirements.
With respect to the exposure to operating cash flow only from the Cobre
magnetite stockpile, the Board is actively embarked on a sale process for a
buyer for the Leigh Creek Copper Mine.
As noted in the Strategic Report, in April 2025, the Company signed a
non-binding heads of agreement for the sale of the Leigh Creek Copper Mine.
Further details can be found in the Strategic Report and in Note 27.
In relation to cash flow management of the Company, the Directors closely
monitor existing and expected cash flow resources and plans for committing
these to project development and covering of corporate overheads. Additional
to this, the Board regularly is in contact with market participants to ensure
that sufficient interest is maintained in the market and that the Company can,
generally, raise funding as required.
A consideration of broader risks of the Company can also be found at pages 11
to 13 of this report and the financial instruments Note 3 of these financial
statements.
Principle 2: Seek to understand and meet shareholder needs and expectations
Shareholder input and communication has been actively sought by the Board
through direct contact with shareholders at both the Annual General Meeting,
shareholder information evenings (sometimes combined with the Annual General
Meeting), monitoring of social media platforms, regular RNS releases and
direct one on one meetings with larger investors. At all times, due regard is
given to the price sensitive nature of comments.
All shareholders are encouraged to attend the Company's Annual General Meeting
and investors have access to current information on the Company through its
website and via the info@strategicminerals.net email address.
Principle 3: Consider wider stakeholder and social responsibilities and their
implications for long-term success
As the Company is involved in the mining industry, the Board is highly
cognisant of its responsibility not only to shareholders but in the broader
community. As such, it has adopted a policy to ensure adequate community
consultation is undertaken in the areas where we operate. Notably, in New
Mexico USA, Cornwall UK and Leigh Creek Australia, communication with local
residents and active involvement in the community has been encouraged.
Additionally, the Company has a policy to, where possible, employ local
residents when undertaking operations. To date, this has proven highly
successful with all locations recording either none or extremely low levels of
community dissent.
Principle 4: Embed effective risk management, considering both opportunities
and threats, throughout the organisation
The management of the business and the execution of the Group's strategy are
subject to a number of risks. The Group regularly reviews the principal risks
that face the business and assesses appropriate responses to mitigate and,
where possible, eliminate potential adverse impact.
The Board is constantly undertaking a review of risk and, as a mining company,
has adopted and engendered a safety culture within the Group to ensure that
personnel safety is considered above financial reward.
Information in relation to the Key Risks and Uncertainties that are relevant
to the Group are set on page 11-13 of this report.
Board Committees
The Board has established separate sub-committees for Audit and Remuneration
matters (chaired by Charles Manners). Additionally, a separate Safety
sub-committee (chaired by Charles Manners) operated in 2024.
Given the composition of the Board and the size of the Company, it is felt a
separate Nomination Committee is not yet warranted. However, as the Company's
operations expand, the Board will monitor this aspect of operations and will
respond accordingly. The Board collectively undertakes the function of such a
committee and where conflicts arise the Directors exclude themselves from
voting on such matters.
Further information on the Company's Audit, Remuneration, and Safety
Committees and their policies are set out under Principle 9 below.
Member details of the committees as at the date of this report are:
Members Remuneration Committee Safety Committee Audit Committee
Charles Manners - Non-Executive Chairman Chair Chair Chair
Mark Burnett - Executive Director Member Member Member
Principle 5: Maintaining the Board as a well-functioning, balanced team led by
the chair
There are currently three (3) Board Directors (two of which are non-executive)
and the Board considers that, at this time, this is appropriate to the
Company's current level of operations, although this is reviewed formally at
least annually. The Board is considered well balanced in that:
- Charles Manners - Non-Executive Chairman (appointed 1 September 2024)
Mr Manners has been the largest shareholder in SML for a number of years. He
worked in investment banking from 1985 until 2009, latterly as a Senior
Managing Director and Head of Fixed Income Sales at Nomura International
PLC. From 2009 to 2016, he was a co-founder and partner in an advisory firm,
focussed on tailored structured solutions. He was a Non-Executive Director of
Asset Trust Housing Association Limited, a regulated provider of affordable
shared ownership housing, and is a Director and Chairman of the Board of
Campden Charities. In addition, he is an extensive investor, focussed
primarily on natural resources, healthcare and real estate.
- Mark Burnett - Executive Director (appointed as Non-Executive Director 1
September 2024
then as Executive Director 15 November 2024)
Mr Burnett is Director of Mining Investments at RAB Capital, a leading mining
specialist investor in London, with over 10 years investing and corporate
finance experience in extractive industries across North America, Australia
and Europe. He is Interim-Chair of a critical metals company operating in
Africa and a Non-Executive Director of a critical metals company operating in
the USA.
- Philip Haydn-Slater - Independent Non-Executive Director (appointed 25
January 2025)
Mr Haydn-Slater has significant public and private company exposure, covering
corporate finance, investments, and Board positions of publicly listed
companies.
He is currently the Non-Executive Chairman of Riverfort Global Opportunities
PLC. He was previously Non-Executive Director of RA International PLC, as well
as ASX Listed ADX Energy Ltd and Sacgasco Ltd.
- Peter Wale - (resigned 24 March 2025)
As an Executive Director, Mr Wale provided an invaluable bridge to
shareholders providing insights into shareholder requirements as well as
monitoring and handling media aspects. Peter, along with John Peters, managed
the Company's interface with shareholders, media and the investment community.
Peter also undertook an executive role in the management of Cornwall Resources
Limited.
- Alan Broome AM - (resigned 16 July 2024)
The Non-Executive Independent Chairman, provided a sounding board for
corporate strategy, a wealth of mining experience, is a metallurgist by
training and is highly experienced in corporate governance. Mr Broome was not
involved with the day-to-day operations of the Company and provided guidance
at the Board level.
- John Peters - (resigned 15 November 2024)
As Managing Director, Mr Peters brought in-depth strategic management and
investment banking experience. His practical management helped to focus the
Company and its consultants on the overall strategy while managing the hands
on, day to day management.
All Directors are encouraged to use their independent judgement and to
challenge all matters, whether strategic or operational.
Role of the Chairman
The Chairman's role is multifaceted, encompassing leadership, effective board
functioning, communication, and oversight of governance practices. He is
responsible for leading the board, setting agendas, facilitating discussions,
and ensuring all board members have a voice. The chair also acts as a key
communicator, representing the board to stakeholders and shareholders. He
oversees the board's performance, including annual reviews, and is responsible
for setting high governance standards.
Attendance at Board and Committee Meetings
The Board aims to meet at least eight times a year and as required from time
to time to consider specific issued required for decision by the Board.
The Company held nine Board meetings and several sub-committee meetings during
the reporting period and the number of meetings attended by each of the
Directors of the Company during the year to 31 December 2024 is listed below.
The Directors attended all Board meetings and committee meetings that they
were eligible and required to attend, except Mr Peter Wale who did not attend
two Board meetings.
Director Board Meetings Remuneration Committee Audit Committee Safety Committee
A Broome¹ Chairman 5 - 1 -
J Peters Executive Director 9 - - -
P Wale Executive Director 9 - 1 -
M Burnett Executive Director 7 1 - -
C Manners² Chairman 7 1 - -
1. Chairman to 16 July 2024
2. Chairman from 11 September 2024
Directors' conflict of interest
The Company has effective procedures in place to monitor and deal with
conflicts of interest. The Board is aware of the other commitments and
interests of its Directors, and changes to these commitments and interests are
reported to and, where appropriate, agreed with the rest of the Board.
Time Commitment of Directors.
All current Directors are remunerated on fixed fee part time basis and are
remunerated for hours over and above their normal duties. Mr John Peters was
remunerated on a full-time basis up to his resignation on 15 November 2024.
Principle 6: Ensure that between them the Directors have the necessary
up-to-date experience, skills and capabilities
Biographies for the Directors can be found in the 'Board of Directors and
Corporate Management' section of the company website at
https://www.strategicminerals.net/company/our-team.html
The Board is not dominated by one person or group of people.
The Board undertakes regular reviews of its capacity to guide the Company in
seeking to implement the Company's strategy. The Board also reviews
periodically the appropriateness and opportunity for continuing professional
development whether formal or informal.
Independent advice
All Directors are able to take independent professional advice in the
furtherance of their duties, if necessary, at the Company's expense. In
addition, the Directors have direct access to the advice and services of the
Company Secretary, Chief Financial Officer, and the Company's NOMAD, lawyers
and auditors.
Re-election of Directors
The Company's Articles of Association require that one-third of the Directors
must stand for re-election by shareholders annually in rotation and that any
new Directors appointed during the year must stand for election at the AGM
immediately following their appointment.
Principle 7: Evaluate the Board performance based on clear and relevant
objectives, seeking continuous improvement
Given the size of the Company and the small but critical nature of the roles
of the Directors, board performance measures have not been independently
developed. The Company relies upon the market and shareholder feedback to
assess the Board's performance.
Principle 8: Promote a culture that is based on ethical values and behaviours
The Directors recognise that their decisions regarding strategy and risk will
impact the corporate culture of the Company as a whole and that this will
impact the performance of the Company. The Board seeks to embody and promote a
corporate culture that is based on sound ethical values as it believes the
tone and culture set by the Board impacts all aspects of the Company,
including the way that employees and other stakeholders behave.
The Company has adopted a code for Directors' and employees' dealings in
securities which is appropriate for a company whose securities are traded on
AIM and is in accordance with the requirements of the Market Abuse Regulation
which came into effect in 2016. The Code sets out the circumstances and
procedures by which shares can be bought and sold and is supplied to all
persons discharging managerial duties.
The formation of the Safety Committee and the way options are allocated to
Directors and key management/consultants has created a team environment in
which the running of the Company is aligned with medium to longer term
shareholder goals.
These measures enable the Company to determine that ethical values and
behaviours are recognised and respected.
Principle 9: Maintain governance structures and processes that are fit for
purpose and support good decision-making by the Board
As a resource development company, the Board considers that the crucial
governance structures and processes revolve around Safety, Audit and
Remuneration.
Safety Committee
Safety is a critical matter, particularly given the capacity for harm to
employees and consultants. The purpose of the Safety Committee is to ensure
that our vision, to provide a safe workplace where no harm comes to anyone, is
applied at all of the Company's locations and that a culture of safety purveys
throughout the organisation.
The Company believes that all reasonable efforts should be undertaken to
ensure incidents are prevented, management have ultimate accountability for
health and safety but everyone on site has a responsibility to ensure no one
comes to harm and employees have the responsibility to stop any job or
activity they believe is unsafe and could cause harm to people.
The Safety Committee attempts to monitor, and report to the full Board, on the
achievement of the Company in devoting the necessary resources needed to
create a working environment, both physically and supervisorial, in which our
people and others under our influence and control can work without sustaining
injury or suffering ill health; ensuring no business target takes priority
over health and safety; using risk assessments to identify hazards and unsafe
behaviours and introduce actions to reduce the risk to acceptable levels;
investigating and reporting all accidents and dangerous occurrences and
preventing future incidents; setting safety targets with the aim of preventing
incidents and accidents and communicate the performance to all employees;
ensuring all employees are competent to carry out the tasks assigned to them
by providing the relevant information, instruction, training and supervision
required; encouraging everyone to contribute to working safely and preventing
accidents; designing, constructing, operating and maintaining all equipment,
buildings and structures to ensure a safe operation; and comply with all
current legislation and codes of practice.
Audit Committee
The purpose of the Audit Committee is to provide formal and transparent
arrangements for considering how to apply the financial reporting and internal
control principles set out in the QCAC and to maintain an appropriate
relationship with the Company's auditors. The key terms are as follows:
- to monitor the integrity of the financial statements of the Company and
Group, and any formal announcement relating to the Company's performance.
- to monitor the effectiveness of the external audit process and make
recommendations to the Board in relation to the appointment, re-appointment
and remuneration of the external auditors;
- to keep under review the relationship with the external auditors including
(but not limited to) their independence and objectivity;
- to keep under review the effectiveness of the Company's financial
reporting and internal control policies and systems;
- to review key judgements and estimates relating to the impairment
assessment of project assets - LCCM, CRL; and
- to assess the ability of the Company and Group to continue as a going
concern.
Further details of Board committees are given under Principle 4 above.
Securities Trading
The Company has adopted a share dealing code for dealings in shares by
Directors and senior employees which is compliant with the Market Abuse
Regulation (EU) No 596/2014 ("MAR") and appropriate for an AIM company. The
Directors will comply with MAR and AIM Rule 21 relating to dealings and will
take all reasonable steps to ensure compliance by persons discharging
managerial responsibility ("PDMR") and persons closely associated with them.
Suitability of governance structures
The Board intends that the Company's governance structures evolve over time in
parallel with its objectives, strategy and business model to reflect the
development of the Company.
Principle 10: Communicate how the Company is governed and is performing by
maintaining a dialogue with shareholders and other relevant stakeholders
The Directors believe a healthy dialogue exists between the Board, the
Company's shareholders and other stakeholders. The Board regularly has reports
on shareholder feedback through summary of social media comments, and
undertakes site visits and customer visits throughout the year.
In addition, all shareholders are encouraged to attend the Company's Annual
General Meeting. The outcomes of all shareholder votes are disclosed in a
clear and transparent manner via a regulatory information service, such as RNS
of the London Stock Exchange.
The Company includes historical annual reports, notices of general meetings
and RNS announcements over the last five years on its website. The Company
lists contact details on its website and on all announcements released via
RNS, should shareholders wish to communicate with the Board.
The Company will include, when relevant, in its annual report, any matters of
note arising from the Audit or Remuneration Committees.
EXTERNAL AUDITOR
During the year the Board met with the auditor to discuss the audit process
and the matters the auditor identified during the audit. The Board will
continue to meet with the auditor at least twice a year to consider the
results, internal procedures and controls and matters raised by the auditor.
The Board considers auditor independence and objectivity and the effectiveness
of the audit process. It also considers the nature and extent of the non-audit
services supplied by the auditor reviewing the ratio of audit to non-audit
fees and ensures that an appropriate relationship is maintained between the
Group and its external auditor. The current auditor has not supplied any
non-audit services.
The Group controls the provision of non-audit services by the external auditor
in order that their objectivity and independence are safeguarded and approved
of the non-audit services provided by the external auditors. As part of the
decision to recommend the appointment of the external auditor, the Board
considers the tenure of the auditor in addition to the results of its review
of the effectiveness of the external auditor and considers whether there
should be a full tender process.
There are no contractual obligations restricting the Board's choice of
external auditor. Moore Kingston Smith LLP were appointed as auditors of the
Company for the financial year. A resolution to reappoint Moore Kingston Smith
LLP will be put to the shareholders at the next Annual General Meeting.
STRATEGIC MINERALS PLC
AUDIT COMMITTEE REPORT
This report addresses the responsibilities, the membership, and the activities
of the Audit Committee in 2024 and up to the approval of the 2024 Annual
Report and 2024 year-end financial statements.
Responsibilities
The main responsibilities of the Audit Committee are to:
- monitor the integrity of the financial statements of the Company and
Group, and any formal announcement relating to the Company's performance;
- monitor the effectiveness of the external audit process and make
recommendations to the Board in relation to the appointment, re-appointment
and remuneration of the external auditors;
- keep under review the relationship with the external auditors including
(but not limited to) their independence and objectivity;
- keep under review the effectiveness of the Company's financial reporting
and internal control policies and systems;
- review key judgements and estimates relating to the impairment assessment
of project assets - LCCM, CRL; and
- assess the ability of the Company and Group to continue as a going
concern.
Membership
Members of the Audit Committee:
- Charles Manners (Chairman) (appointed 1 September 2024)
- Mark Burnett (appointed 1 September 2024)
- Peter Wale (resigned 24 March 2025)
Activities in 2024
With regard to the 2024 year-end audit, the Audit Committee has reviewed the
following key audit matters:
1. Going Concern
The Directors have considered the Company's and Group's ability to continue as
a going concern through review of cash flow forecasts prepared by management
for the period to 31 December 2026 and a review of the key assumptions on
which these are based and sensitivity analysis.
The Company and Group forecasts that to have sufficient funds to meet all
operating costs until 31 December 2026, the Company and Group is reliant on
cash being generated from its magnetite revenue. The group does not have
guaranteed revenue for the period to 31 December 2026 and the level of the
group's future revenue and associated cashflow receipts cannot be determined
with any certainty. If the group's major customer does not renew its 2025 and
2026 orders at similar level to the year ended 31 December 2024, then the
group may be required to secure alternative funding over the course of the
next twelve months from the date of signing of the financial statements. The
need to secure this future funding if revenue receipts do not attain a certain
level represents a material uncertainty that may cast significant doubt on the
company's and group's ability to continue as a going concern.
As outlined by the Board, it is intended that any funds required to progress
either the sale of Leigh Creek Copper Mine and/or Redmoor Project will be
sourced at the asset level and the Directors are actively pursuing such
funding.
In May 2025, the Company raised in aggregate, gross proceeds of £1m through
the placing of 333,333,333 new Ordinary Shares to certain investors at a price
of 0.3 pence per share. The net proceeds of the Placing will be
principally used to progress activities at the Company's Redmoor
Tungsten-Tin-Copper Project in Cornwall and for working capital purposes.
The Directors have reasonable expectation that the Company and Group will
continue to have access to sufficient resources by way of debt or equity
markets should the need arise. Consequently, the financial statements have
been prepared on a going concern basis.
The financial statements do 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 Company
and Group not continue as a going concern.
2. Impairment Assessments
The Committee has reviewed the judgements surrounding the impairment
assessments required under IAS36 for LCCM and IFRS6 for Central Australian
Rare Earths Pty Ltd ("CARE") and CRL.
CARE: The Group reduced the carrying amount of the asset to nil in 2019 recognising
an impairment loss. During 2021 all tenements were relinquished to the Western
Australian government.
CRL: The Redmoor Project is an early-stage exploration project. The Audit Committee
is satisfied that results from exploration activity provide sufficient
evidence of the continued prospectivity of the asset. Accordingly, no
impairment indicators have been identified.
LCCM: Despite the Board's efforts to secure funding, a transaction has not been
achieved. As this is a significant indicator of the ongoing impairment for the
LCCM project, the Group has continued to maintain the carrying amount of the
asset at nil and has therefore recognised an impairment loss in the year of
$0.113m (2023: $8.898m).
COBRE: The Property Plant and Equipment and Right to Use Assets have been assessed
for impairment. These assets are being depreciated/amortised in accordance
with their estimated useful life or lease term. No impairment indicators have
been identified.
Conclusion
In 2025 and beyond, the Audit Committee will continue to adopt the new
reporting and regulatory requirements and ensure that the system of internal
controls is both maintained and regularly reviewed for improvement. The Audit
Committee will also continue to review group assets for triggers that may
indicate impairment and closely monitor the financial risks faced by the
business and progress made towards mitigating these.
For and on behalf of the Audit Committee
Charles Manners
Chair of Audit Committee
16 June 2025
STRATEGIC MINERALS PLC
REMUNERATION COMMITTEE REPORT
This remuneration report has been prepared by the Remuneration Committee and
approved by the Board. The report for 2024 sets out the details of
remuneration for the Directors and discloses the amounts paid during the year.
Membership
Members of the of the Remuneration Committee are Charles Manners (Chairman)
and Mark Burnett. Other Directors are invited to attend as appropriate
provided they do not have a conflict of interest. The aim of the Remuneration
Committee is to attract, retain and motivate the executive management of the
Company and to offer the opportunity for employees to participate in share
option schemes to incentivize employees to enhance shareholder value.
Director Remuneration (audited)
Remuneration for Directors who held office during the year is as follows:
2024 Directors' Salary and Consultancy Total
fees fees
2024 2024 2024
$'000 $'000 $'000
C Manners 10 - 10
M Burnett 10 - 10
A Broome 6 30 36
J Peters* 11 44 55
P Wale* 41 - 41
Total 78 74 152
2023 Directors' Salary and Consultancy Total
fees fees
2023 2023 2023
$'000 $'000 $'000
A Broome AM 12 54 66
J Peters 12 128 140
J Peters - Capitalised Fee** - 45 45
P Wale 39 - 39
P Wale - Capitalised Fee** 60 - 60
J Harrison 4 8 12
J Harrison - Capitalised Fee*** - 17 17
Total 127 252 379
* Executive Directors' fees were temporarily reduced in 2024 reflecting
undertakings associated with 2023.
** During 2023 J Peters and P Wale provided extended director services to CRL
and LCCM. This expenditure was capitalised as part of Exploration and
Evaluation assets.
No fees were capitalised in 2024.
*** J Harrison provided consultancy services for CRL. This expenditure was
capitalised as part of Exploration and Evaluation assets.
Details of other Director-related party transactions are detailed at Note 25.
J Peters was the only full time Director in 2024 and 2023. All other directors
were part time in 2024 and 2023. J Peters was also the highest paid Director
in 2024 and 2023.
J Peters resigned on 15 November 2024.
It should be noted that the Directors of the Company, since becoming
Directors, have not sold any shares as at the date of this report.
Directors do not hold any options at 31 December 2024 (2023: nil.)
At 31 December, no director has any accrued short term, post-employment, long
term, termination benefits or share based payments, (2023: nil).
Director Remuneration Policy
Going forward into 2025 and beyond, the Committee and I will remain focused on
ensuring that reward at the Company continues to be closely aligned with the
delivery of long-term shareholder value.
For and on behalf of the Remuneration Committee
Charles Manners
Chair of Remuneration Committee
16 June 2025
STRATEGIC MINERALS PLC
FOR THE YEAR ENDED 31 DECEMBER 2024
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF STRATEGIC MINERALS PLC
Opinion
We have audited the Group financial statements of Strategic Minerals Plc (the
'parent company') and its subsidiaries (the 'Group')for the year ended 31
December 2024 which comprise the Consolidated Statement of Comprehensive
Income, the Consolidated and Company Statements of Financial Position, the
Consolidated and Company Statements of Cash Flows, the Consolidated and
Company Statements of Changes in Equity 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.
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 2024 and
of the Group's profit 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 the 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 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.
An overview of the scope of our audit
Our audit approach was a risk-based approach founded on a thorough
understanding of the group's business, its environment and risk profile. We
conducted substantive audit procedures and evaluated the group's internal
control environment. We also addressed the risk of management override of
internal controls, including assessing whether there was evidence of bias by
the directors that may have represented a risk of material misstatement. The
components of the group were evaluated by the group audit engagement team
based on a measure of materiality, considering each component as a percentage
of the group's total assets, current assets, revenue and gross profit, which
allowed the group audit engagement team to assess the significance of each
component and determine the planned audit response.
For those components that were evaluated as significant components, either a
full scope audit or a specified audit procedures approach was determined based
on their relative materiality to the group and our assessment of the level of
audit risk. For components requiring a full scope audit approach, we evaluated
controls by performing walkthroughs over the financial reporting systems
identified as part of our risk assessment, reviewed the accounts production
process and addressed critical accounting matters. We then undertook
substantive testing on significant transactions and material account balances.
In order to address the audit risks in respect of the group and company
financial statements identified during our planning procedures, we performed a
full scope audit of the financial statements of the parent company. For the
purpose of expressing our opinion on the group financial statements, we also
performed a full scope audit of the financial information of Southern Minerals
Group LLC, Cornwall Resources Limited and Leigh Creek Copper Mine Pty Ltd.
We performed analytical procedures on the remaining components, which were
individually immaterial but collectively covered residual group risk. All work
was carried out by the group audit engagement team.
We communicated with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant findings,
including any significant deficiencies in internal controls that we identified
during the audit.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were
of most significance in our audit of the group 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 group
financial statements, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. This is not a complete list of
all risks identified by our audit.
Audit Matter Procedures
Valuation of Exploration and Evaluation assets Our audit work included, but was not restricted to, the following procedures:
Refer to page 50 (Accounting policy) and pages 70 and 71 (note 9 Intangible · We critically assessed management's summary of the IFRS 6 project
assets). assets including the projected expenditure for each tenement.
As at 31 December 2024 the Group held exploration and evaluation assets with a · We confirmed that the Group has valid title to the applicable
carrying value of $5.901m (2023: $5.568m). exploration licences and has fulfilled any specific conditions therein
particularly having regard to minimum expenditure requirements.
Management has performed an impairment review of exploration and evaluation
assets and concluded that no further impairment is required. · We reviewed and substantively tested capitalised exploration and
evaluation expenditure including consideration of its appropriateness for
capitalisation under IFRS 6.
The assessment of the recoverable amount of the exploration and evaluation
assets required judgments and estimates by management.
· We critically assessed the progress of the Redmoor project during
the year and post year-end.
The carrying value of the Group's exploration and evaluation assets was
therefore considered to be a key audit matter.
· We considered management's impairment reviews in light of any
impairment indicators identified in accordance with IFRS 6, including
corroboration and challenge thereof.
· We reviewed the appropriateness and adequacy of the disclosures
in the financial statements.
Based on our procedures performed we are satisfied that there was no
impairment of exploration and evaluation assets in the year.
We consider the disclosures in the financial statements relating to this area
to be adequate.
Valuation of investments and recoverability of loans made to subsidiary Our audit work included, but was not restricted to, the following procedures:
undertakings
· We gained an understanding of the interactions between Strategic
Refer to pages 48 and 49 (Accounting policy) and pages 72 and 73 (note 10 Minerals Plc and its subsidiaries particularly in respect of their performance
Investments). throughout the year.
At 31 December 2024 the value of investments and loans to subsidiary · We assessed how settlement can be achieved, first by comparing
undertakings in the company financial statements was $4.523m (2023: $4.411m) the cumulative carrying value of the investments and loans made to subsidiary
and $1.431m (2023: $1.066m) respectively. undertakings to their respective net assets and by assessing each subsidiary's
cash flow forecasts.
Management has assessed the carrying value of investments and recoverability
of loans made to subsidiary undertakings including the application of the · We critically assessed management's assessment that loans due
expected credit loss ('ECL') model under IFRS 9. from group undertakings should be accounted for in accordance with IFRS 9 and
are not within the scope of IAS 27.
In making this assessment, management makes several significant judgements.
These include determining appropriate assumptions for calculating the loss · We critically assessed the recoverability of loans due from group
allowance under IFRS 9 (including probability of default and loss given undertakings in respect of expected credit losses (ECL) in accordance with
default and cash flow forecasts. IFRS 9.
As a result, errors or deliberate manipulation of these determining factors · We reviewed the appropriateness and adequacy of the disclosures
could result in material misstatement of the financial statements. in the financial statements.
Consequently, it was considered to be a key audit matter.
· We critically assessed the reasonableness of management's
allocation of loans to the various stages under IFRS 9 including an assessment
of management's definition of significant increase in credit risk and
definition of default.
· We critically assessed the accounting policy and detailed
disclosures in the financial statements to determine whether information
provided in the financial statements is compliant with the requirements of
IFRS 9.
Based on our audit work performed we have not identified any material
misstatement in the valuation of investments and loans to subsidiary
undertakings.
We consider the disclosures in the financial statements relating to this area
to be adequate.
Revenue recognition Our audit work included, but was not restricted to, the following procedures:
The group's revenue for the year ended 31 December 2024 was $4.745m (2023:
$1.577m) being the sale of magnetite made by Southern Minerals Group LLC.
· We obtained and documented an understanding of the methodology
for recognising revenue to determine whether it was appropriate.
Revenue recognition is a presumed significant risk and is material to the
financial statements. Consequently, it was considered to be a key audit
matter. · We critically assessed the group's revenue accounting policy to
evaluate compliance with IFRS 15.
· We performed substantive testing on a sample of individual
revenue transactions throughout the year to evaluate whether revenue is
recognised in accordance with the loan contract terms, the group's accounting
policy and the requirements of IFRS 15.
· We performed analytical procedures over revenue to assess any
anomalies in the price per tonne.
· We performed revenue cut off testing to ensure revenue has been
recognised in the correct accounting period.
· We critically assessed the disclosures in the financial
statements to determine whether the accounting policy and other revenue
disclosures comply with the disclosure requirements of IFRS 15.
Based on our audit work performed we have not identified any material
misstatement in the recognition of revenue.
We consider the disclosures in the financial statements relating to this area
to be adequate.
Going concern Our audit work and conclusions in respect of going concern has been detailed
in the 'Material uncertainty related to going concern' section of our audit
Refer to note 1 on page 47 in the consolidated financial statements. report.
The group has generated a post tax profit of $1.305m for the year (including
discontinued operations) (2023: $9.155m loss) but has net current liabilities
of $1.041m (2023: $2.087m) disclosed in the Consolidated Statement of
Financial Position at 31 December 2024.
The directors have prepared a cashflow forecast that show that the group will
be able to meet its ongoing liabilities as they fall due for at least twelve
months from the date of signing of these financial statements.
Our application of materiality
The scope and focus of our audit were influenced by our assessment and
application of materiality. We define materiality as the magnitude of
misstatement that could reasonably be expected to influence the readers and
the economic decisions of the users of the financial statements. We use
materiality to determine the scope of our audit and the nature, timing, and
extent of our audit procedures and to evaluate the effect of misstatements,
both individually and on the financial statements as a whole. We apply the
concept of materiality both in planning and performing our audit, and in
evaluating the effect of misstatements.
Based on our professional judgement we determined materiality for the
financial statements as a whole and performance materiality as follows:
Group financial statements
Materiality $86,500
Basis for determining materiality Gross assets
Rationale for the benchmark applied The group is an asset-based operation. Consequently, gross assets was
considered likely to be the metric on which the users of the financial
statements will place most focus.
Performance materiality $43,250
Basis for determining performance materiality 50% of overall materiality.
Parent company financial statements
Materiality $59,800
Basis for determining materiality Gross assets
Rationale for the benchmark applied The parent company holds investments in and loans to subsidiary undertakings.
Consequently, gross assets was considered likely to be the metric on which the
users of the financial statements will place most focus.
Performance materiality $29,900
Basis for determining performance materiality 50% of overall materiality.
Performance materiality:
We calculated performance materiality at a level lower than materiality to
reduce the probability that, in aggregate, uncorrected and undetected
misstatements exceed the materiality level for the Group consolidated
financial statements as a whole. We determined group and parent company
performance materiality to be $43,250 and $29,900 respectively, which was set
at 50% of overall materiality and reflects the parent's and group's listed
status.
Component materiality:
We set materiality for each component of the group based on a percentage of
group materiality dependent on the size and our assessment of risk of material
misstatements of that component. Component materiality, other than the parent
company's, ranged from $1,300 to $59,000. In the audit of each component, we
further applied performance materiality levels of 50% of the component
materiality to our testing to ensure that the risk of errors exceeding
component materiality was appropriately mitigated.
Trivial:
We agreed with the Audit Committee that we would report to them all individual
audit differences in excess of $4,325 and $2,990 for the group and parent
company respectively. We also agreed to report differences below this
threshold that, in our view, warranted reporting on qualitative grounds. We
also reported to the Audit Committee on disclosure matters that we identified
when assessing the overall presentation of the financial statements.
Material uncertainty related to going concern
We draw attention to note 1 to the financial statements, which indicates that
the parent company and group are dependent on cash receipts from its magnetite
revenue. The group does not have guaranteed revenue for the period to 31
December 2026, and the level of the group's future revenue and associated cash
flow receipts cannot be determined with any certainty. If the group's major
customer does not renew its 2025 and 2026 orders at a similar level to the
year ended 31 December 2024 then the group may be required to secure
alternative funding over the course of the next twelve months from the date of
signing of these financial statements. The need to secure this future funding
if revenue receipts do not attain a certain level represents a material
uncertainty that may cast significant doubt on the Company's and Group's
ability to continue as a going concern. Our opinion is not modified in respect
of this matter.
In auditing the financial statements, we have 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 groups and the parent company' ability to continue to adopt
the going concern basis of accounting included, but was not limited to, the
following procedures:
• Critically assessing the going concern assessment
prepared by management covering at least twelve months from the date of the
audit report and challenging management as regards to the key assumptions and
forecasts used in their assessment;
• Performing sensitivity analysis on the forecasts to
ensure there is sufficient cash flow headroom for the group to continue as a
going concern for at least that period;
• Reviewing the trading performance of the group post
year end and comparing it to the forecasts to assess their accuracy; and
• Assessing the adequacy of the going concern
disclosures in the financial statements.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Emphasis of Matter
We draw attention to Note 2 on page 57 to the financial statements which
describes the uncertainty related to the post year end disposal of Leigh Creek
Copper Mine Pty Ltd. Management have considered the scenario whereby under the
Call Option the purchaser elects to acquire 100% of Leigh Creek Copper Mine
Pty Ltd and has also considered a scenario whereby the purchaser does not
elect to acquire 100% of Leigh Creek Copper Mine Pty Ltd.
The group has accrued for an environmental bond, as detailed in Notes 15,22
and 28, due to the Department of Energy and Mining, South Australian
Government, for $1.082m at 31 December 2024. If under the Call Option the
purchaser elects not to acquire 100% of Leigh Creek Copper Mine Pty Ltd the
environmental bond will remain payable by the group likely within twelve
months from the date of signing these financial statements. Management's cash
flow forecast for the period to 31 December 2026 does not include the payment
of the environmental bond. If the environmental bond is not paid then
potentially the mineral lease, which is due to be renewed in October 2025, may
be cancelled by the Department of Energy and Mining. Due to the unpredictable
outcome of whether the purchaser will elect to acquire 100% of Leigh Creek
Copper Mine Pty Ltd in the six month exercise period from 11 June 2025 the
impact on the group and the company cannot be predicted with any certainty.
Our opinion is not modified in respect of this matter.
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 financial statements does not cover the
other information and, except to the extent otherwise explicitly stated in our
report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility
is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our
knowledge obtained in the 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 there is a
material misstatement in the financial statements themselves. If, based on the
work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
· the information given in the strategic report and the 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 its 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 where 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 directors' responsibilities statement set out
on page 20, the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and
for such internal control as the 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 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 aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
A further description of our responsibilities is available on the FRC's
website at
https://www.frc.org.uk/auditors/auditor-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor's-responsibilities-for
(https://www.frc.org.uk/auditors/auditor-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor's-responsibilities-for)
This description forms part of our auditor's report.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
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.
The objectives of our audit in respect of fraud, are; to identify and assess
the risks of material misstatement of the financial statements due to fraud;
to obtain sufficient appropriate audit evidence regarding the assessed risks
of material misstatement due to fraud, through designing and implementing
appropriate responses to those assessed risks; and to respond appropriately to
instances of fraud or suspected fraud identified during the audit. However,
the primary responsibility for the prevention and detection of fraud rests
with both management and those charged with governance of the company.
Our approach was as follows:
· We obtained an understanding of the legal and regulatory
requirements applicable to the group and parent company and considered that
the most significant are the Companies Act 2006, UK adopted International
Accounting Standards and UK taxation legislation.
· We obtained an understanding of how the group and parent company
complies with these requirements by discussions with management and those
charged with governance.
· We assessed the risk of material misstatement of the financial
statements, including the risk of material misstatement due to fraud and how
it might occur, by holding discussions with management and those charged with
governance.
· We inquired of management and those charged with governance as to
any known instances of non-compliance or suspected non-compliance with laws
and regulations.
· Based on this understanding, we designed specific appropriate
audit procedures to identify instances of non-compliance with laws and
regulations. This included making enquiries of management and those charged
with governance and obtaining additional corroborative evidence as required.
· We evaluated managements' incentives to fraudulently manipulate
the financial statements and determined that the principal risks related to
management bias in accounting estimates and judgemental areas of the financial
statements. We challenged the assumptions and judgements made by management in
respect of the significant areas of estimation, as described in the key audit
matters section. Further audit procedures performed to address the risk of
fraud included but were not limited to the testing of journals and evaluating
the business rationale of any significant transactions that are unusual or
outside the normal course of business.
There are inherent limitations in the audit procedures described above. We are
less likely to become aware of instances of non-compliance with laws and
regulations that are not closely related to events and transactions reflected
in the financial statements. Also, the risk of not detecting a material
misstatement due to fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through collusion.
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 for no purpose other than to draw to the attention of the company's
members those matters which we are required to include in an auditor's report
addressed to them. To the fullest extent permitted by law, we do not accept or
assume responsibility to any party other than the company and company's
members as a body, for our work, for this report, or for the opinions we have
formed.
Matthew Banton 16 June 2025
for and on behalf of Moore Kingston Smith LLP, Statutory Auditor
6th Floor
9 Appold Street
London
EC1A 2AP
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
As restated
Year to Year to
31 December 31 December
Note 2024 2023
$'000 $'000
Revenue 4 4,745 1,577
Raw materials and consumables used (846) (262)
________ ________
Gross profit 3,899 1,315
Other income 5 - 4
Overhead expenses 5 (1,726) (1,455)
Other expenses 5 (45) (34)
Impairment expense 5 - (8,898)
________ ________
Profit /(loss) from operations 2,128 (9,068)
Lease interest 5 (19) (14)
________ ________
Profit /(loss) before taxation 2,109 (9,082)
Income tax charge 7 (691) (73)
________ ________
Profit /(loss) for the year from continuing operations 1,418 (9,155)
Loss for the year from discontinued operations 26 (113) -
________ ________
Profit /(loss) for the period attributable to the owners of the parent 1,305 (9,155)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Exchange gain arising on translation of foreign operations (71) 189
________ ________
Total comprehensive income/(loss) attributable to the owners of the parent 1,234 (8,966)
________ ________
Profit /(loss) per share attributable to the ordinary equity holders of the
parent:
Basic and diluted profit/(loss) per share from total operations (cents) 8 0.64 (0.45)
Basic and diluted profit/(loss) per share from continuing operations (cents) 8 0.70 (0.45)
Basis and diluted profit(loss) per share from discontinued operations (cents) 8 (0.06) -
The accompanying accounting policies and notes form an integral part of these
financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
As restated As restated
31 December 31 December 1 January
2024 2023 2023
Notes $'000 $'000 $'000
Assets
Non-current assets
Other intangible asset 9 - - 544
Exploration and evaluation assets 9 5,901 5,568 4,983
Property, plant, and equipment 11 60 80 8,223
Right of Use assets 18 1,053 453 584
Other receivables 13 - 136 136
________ ________ ________
7,014 6,237 14,470
Current assets
Inventories 12 4 4 5
Trade and other receivables 13 295 219 319
Assets held for sale 22 127 - -
Income tax prepayment - 31 88
Prepayments 13 36 - 25
Cash and cash equivalents 14 621 112 341
________ ________ ________
1,083 366 778
________ ________ ________
Total Assets 8,097 6,603 15,248
________ ________ ________
Equity and liabilities
Share capital 19 2,916 2,916 2,916
Share premium 19 49,387 49,387 49,387
Merger reserve 21,300 21,300 21,300
Foreign exchange reserve (1,216) (1,145) (1,334)
Warrant reserve 19 5 5 -
Other reserves (23,023) (23,023) (23,023)
Retained earnings (44,403) (45,708) (36,553)
________ ________ ________
Total Equity 4,966 3,732 12,693
________ ________ ________
Liabilities
Non-current Liabilities
Provisions 16 270 116 150
Lease liabilities 18 737 302 305
________ ________ ________
1,007 418 455
Current liabilities
Liabilities held for sale 22 1,098 - -
Income tax payable 415 101 261
Trade and other payables 15 242 2,164 1,557
Loan and borrowings 21 - 35 -
Lease liabilities 18 369 153 282
________ ________ ________
2,124 2,453 2,100
________ ________ ________
Total Liabilities 3,131 2,871 2,555
________ ________ ________
Total Equity and Liabilities 8,097 6,603 15,248
________ ________ ________
These financial statements were approved and authorised for issue by the Board
of Directors on 16 June 2025 and were signed on its behalf by:
Mark Burnett
Executive Director
The accompanying accounting policies and notes form an integral part of these
financial statements.
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
2024 2023
Notes $'000 $'000
Assets
Non-current assets
Investments in subsidiary undertakings 10 4,523 4,411
Loans due from subsidiary undertakings 10 1,431 1,066
________ ________
5,954 5,477
________ ________
Current assets
Trade and other receivables 13 10 7
Cash and cash equivalents 14 14 7
________ ________
24 14
________ ________
Total Assets 5,978 5,491
________ ________
Equity and liabilities
Share capital 19 2,916 2,916
Share premium 19 49,387 49,387
Merger reserve 21,300 21,300
Foreign exchange reserve (1,397) (1,337)
Warrant reserve 19 5 5
Retained earnings (70,020) (69,347)
________ ________
Total Equity 2,191 2,924
________ ________
Liabilities
Current liabilities
Trade and other payables 15 110 337
Loans due to subsidiary undertakings 15 3,677 2,230
________ ________
Total Liabilities 3,787 2,567
________ ________
Total Equity and Liabilities 5,978 5,491
________ ________
As permitted by Section 408 of the Companies Act 2006, the statement of
comprehensive income of the parent Company is not presented as part of these
financial statements. The parent Company made a loss for the year of $673,000
(2023: $3,878,000).
These financial statements were approved and authorised for issue by the Board
of Directors on 16 June 2025 and were signed on its behalf by:
Mark Burnett
Executive Director
The accompanying accounting policies and notes form an integral part of these
financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
As restated
Notes Year to Year to
31 December 31 December
2024 2023
$'000 $'000
Cash flows from operating activities
Profit/(loss) 1,305 (9,155)
Adjustments for:
Depreciation of property, plant and equipment 11 18 16
Amortisation of Right of Use Asset 18 334 277
Loss from discontinued operations 26 113 8,898
Income tax expense 7 691 73
Lease interest 19 14
Decrease in inventories 12 - 1
Decrease in trade and other receivables 13 (76) 45
(Increase)/decrease in prepayments 13 (36) 25
(Decrease)/increase in trade and other payables 15 (721) 610
Decrease/(increase) in prepaid income tax 13 - (57)
Income tax paid (223) (154)
Share based payment expense 20 - 5
________ ________
Net cash generated from operating activities 1,424 598
________ ________
Investing activities
Net cash used in discontinued operations 26 (113) (203)
Purchase of exploration and evaluation assets 9 (418) (366)
________ ________
Net cash used in investing activities (531) (569)
________ ________
Financing activities
Proceeds from borrowings 21 62 34
Repayment of borrowings 21 (104) -
Lease payments 18 (343) (296)
________ ________
Net cash used in financing activities (385) (262)
Net increase/(decrease) in cash and cash equivalents 508 (233)
Cash and cash equivalents at beginning of year 112 341
Effects of exchange rate changes on the balance of cash 1 4
held in foreign currencies
________ ________
Cash and cash equivalents at end of year 14 621 112
________ ________
The accompanying accounting policies and notes form an integral part of these
financial statements.
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Notes As restated
Year to Year to
31 December 31 December
2024 2023
$'000 $'000
Cash flows from operating activities
Loss (673) (3,878)
Adjustments for:
Foreign exchange on investment in subsidiary undertakings 10 (112) (269)
Foreign exchange on loans to subsidiary undertakings 10 56 (167)
Impairment of loans to subsidiary undertakings 10 128 3,646
Increase in loans due to subsidiary undertakings 15 1,447 311
Foreign exchange on loans due to subsidiary undertakings 15 (60) 41
(Increase)/decrease in loans due from subsidiary undertakings 10 (549) 89
(Increase)/decrease in trade and other receivables 13 (3) 10
(Decrease)/increase in trade and other payables 15 (227) 210
Share based payment expense - 5
________ ________
Net cash generated from/(used in) operating activities 7 (2)
________ ________
Increase/(decrease) in cash and cash equivalents 7 (2)
Cash and cash equivalents at beginning of year 7 9
________ ________
Cash and cash equivalents at end of year 14 14 7
________ ________
The accompanying accounting policies and notes form an integral part of these
financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Share capital Share premium reserve Merger reserve Warrant reserve Initial Restructure Foreign exchange reserve Retained earnings Total equity
reserve
$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Balance at 2,916 49,387 21,300 - (23,023) (1,334) (36,403) 12,843
1 January 2023 (as originally stated)
Prior year restatement (note 29) - - - - - - (150) (150)
_______ _______ _______ _______ _______ _______ _______ _______
Balance at 1 January 2023 (as restated) 2,916 49,387 21,300 - (23,023) (1,334) (36,553) 12,693
Loss for the year - - - - - - (9,155) (9,155)
Foreign exchange translation - - - - - 189 - 189
_______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income/(loss) for the year - - - - - 189 (9,155) (8,966)
Share based payments - - - 5 - - - 5
_______ _______ _______ _______ _______ _______ _______ _______
Balance at 2,916 49,387 21,300 5 (23,023) (1,145) (45,708) 3,732
31 December 2023 (as restated)
Profit for the year - - - - - - 1,305 1,305
Foreign exchange translation - - - - - (71) - (71)
_______ _______ _______ _______ _______ _______ _______ _______
Total comprehensive income for the year - - - - - (71) 1,305 1,234
_______ _______ _______ _______ _______ _______ _______ _______
Balance at 2,916 49,387 21,300 5 (23,023) (1,216) (44,403) 4,966
31 December 2024
_______ _______ _______ _______ _______ _______ _______ _______
All comprehensive income is attributable to the owners of the parent Company.
The accompanying accounting policies and notes form an integral part of these
financial statements
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Share capital Share Premium reserve Merger reserve Warrant reserve Foreign exchange reserve Retained earnings Total Equity
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Balance at 2,916 49,387 21,300 - (1,378) (65,469) 6,756
1 January 2023
Loss for the year - - - - - (3,878) (3,878)
Foreign exchange translation - - - - 41 - 41
_______ _______ _______ _______ _______ _______ _______
Total comprehensive loss for the year - - - - 41 (3,878) (3,837)
Share based payments - - - 5 - - 5
_______ _______ _______ _______ _______ _______ _______
Balance at 2,916 49,387 21,300 5 (1,337) (69,347) 2,924
31 December 2023
Loss for the year - - - - - (673) (673)
Foreign exchange translation - - - - (60) - (60)
_______ _______ _______ _______ _______ _______ _______
Total comprehensive profit for the year - - - - (60) (673) (733)
_______ _______ _______ _______ _______ _______ _______
Balance at 2,916 49,387 21,300 5 (1,397) (70,020) 2,191
31 December 2024
_______ _______ _______ _______ _______ _______ _______
All comprehensive income is attributable to the owners of the parent Company.
The accompanying accounting policies and notes form an integral part of these
financial statements.
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital
over the nominal value of these shares net of share issue expenses.
Merger reserve arises from the 100% acquisition of Ebony Iron Pty Limited in
September 2011 and LCCM In April 2018 whereby the excess of the fair value of
the issued ordinary share capital issued over the nominal value of these
shares is transferred to this reserve, in accordance with section 612 of the
Companies Act 2006.
Share option reserve relates to increases in equity for services received in
equity-settled share-based payment transactions and on the grant of share
options.
Warrants reserve represents the value of warrants issued. Warrants reserve is
non-distributable and will be transferred to share premium account upon the
exercise of warrants. The balance of warrants reserve in relation to the
unexercised warrants at the expiry of the warrants period will be transferred
to retained earnings.
Initial restructure reserve consists of an adjustment arising from the Group
reorganisation in 2011 being the formation of a new holding Company for Iron
Glen Holdings Limited by way of a share for share issue and is the difference
between consideration given and net assets of the Company at the date of
acquisition.
The foreign exchange reserve occurs on consolidation of the translation of the
subsidiaries balance sheets at the closing rate of exchange and their income
statements at the average rate.
The company foreign exchange reserve recognises the exchange differences
arising on translating the closing net assets of the Company at the closing
rate at the balance sheet date, and the results of Company's operations at
average exchange rate for the year.
Retained earnings represent the cumulative loss of the Group attributable to
equity shareholders.
NOTES FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
1. Significant accounting policies
Basis of preparation
In preparing these financial statements the presentational currency is US
dollars. As the Group's revenues and majority of its costs, assets and
liabilities are denominated in US dollars it is considered appropriate to
report in this currency. The financial statements are rounded to the nearest
$'000.
The principal accounting policies adopted in the preparation of the financial
statements are set out below. The policies have been consistently applied to
all the years presented, unless otherwise stated.
These financial statements have been prepared in accordance with UK adopted
International Accounting Standards in conformity with the requirement of the
Companies Act 2006.
The preparation of financial statements in compliance with UK adopted
International Accounting Standards requires the use of certain critical
accounting estimates. It also requires Group management to exercise judgment
in applying the Group's accounting policies. The areas where significant
judgments and estimates have been made in preparing the financial statements
and their effect are disclosed in note 2.
The financial statements have been prepared on a historical cost basis, except
for the acquisition of LCCM and the valuation of certain investments which
have been measured at fair value.
Going concern basis
The Directors have considered the Company's and Group's ability to continue as
a going concern through review of cash flow forecasts prepared by management
for the period to 31 December 2026 and a review of the key assumptions on
which these are based and sensitivity analysis.
The Company and Group forecasts that to have sufficient funds to meet all
operating costs until 31 December 2026, the Company and Group is reliant on
cash being generated from its magnetite revenue. The group does not have
guaranteed revenue for the period to 31 December 2026 and the level of the
group's future revenue and associated cashflow receipts cannot be determined
with any certainty. If the group's major customer does not renew its 2025 and
2026 orders at similar level to the year ended 31 December 2024, then the
group may be required to secure alternative funding over the course of the
next twelve months from the date of signing of the financial statements. The
need to secure this future funding if revenue receipts do not attain a certain
level represents a material uncertainty that may cast significant doubt on the
company's and group's ability to continue as a going concern.
As outlined by the Board, it is intended that any funds required to progress
either the sale of Leigh Creek Copper Mine and/or Redmoor Project will be
sourced at the asset level and the Directors are actively pursuing such
funding.
In May 2025, the Company raised in aggregate, gross proceeds of £1m through
the placing of 333,333,333 new Ordinary Shares to certain investors at a price
of 0.3 pence per share. The net proceeds of the Placing will be
principally used to progress activities at the Company's Redmoor
Tungsten-Tin-Copper Project in Cornwall and for working capital purposes.
The Directors have reasonable expectation that the Company and Group will
continue to have access to sufficient resources by way of debt or equity
markets should the need arise. Consequently, the financial statements have
been prepared on a going concern basis.
The financial statements do 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 Company
and Group not continue as a going concern.
New standards issued but not yet effective
At the date of approval of these financial statements, the following new or
amended standards and interpretations have been issued by the
International Accounting Standards Board (IASB) and endorsed for use in the
United Kingdom but were not yet effective for the year ended 31 December 2024.
The Group has not early adopted any of these standards.
IFRS Accounting Standard Effective period
Beginning on or after
IAS 1 (Amendments) - Classification of Liabilities as Current or Non-current 1 January 2027
IAS 7 and IFRS 7 (Amendments) - Supplier Finance Arrangements 1 January 2027
IFRS 10 and IAS 28 (Amendments) - Sale or Contribution of Assets between an deferred indefinitely
Investor and its Associate or Joint Venture
IFRS 18 Presentation and Disclosure in Financial Statements 1 January 2027
IFRS 19 Subsidiaries without Public Accountability: Disclosures 1 January 2027
It is not expected that the amendments listed above, except for IFRS 18, once
adopted, will have a material impact on the financial statements.
Basis of consolidation
Where the company has control over an investee, it is classified as a
subsidiary. The company controls an investee if all three of the following
elements are present: power over the investee, exposure to variable returns
from the investee, and the ability of the investor to use its power to affect
those variable returns. Control is reassessed whenever facts and circumstances
indicate that there may be a change in any of these elements of control.
De-facto control exists in situations where the company has the practical
ability to direct the relevant activities of the investee without holding the
majority of the voting rights. In determining whether de-facto control exists
the company considers all relevant facts and circumstances, including:
· The size of the company's voting rights relative to both the size
and dispersion of other parties who hold voting rights;
· substantive potential voting rights held by the company and by
other parties;
· other contractual arrangements; and
· historic patterns in voting attendance.
The consolidated financial statements present the results of the company and
its subsidiaries ("the Group") as if they formed a single entity. Intercompany
transactions and balances between group companies are eliminated in full.
The consolidated financial statements incorporate the results of business
combinations using the acquisition method. In the statement of financial
position, the acquiree's identifiable assets, liabilities and contingent
liabilities are initially recognised at their fair values at the acquisition
date. The results of acquired operations are included in the consolidated
statement of comprehensive income from the date on which control is obtained.
They are deconsolidated from the date on which control ceases.
Investment in joint arrangements
The Group is a party to a joint arrangement when there is a contractual
arrangement that confers joint control over the relevant activities of the
arrangement to the Group and at least one other party. Joint control is
assessed under the same principles as control over subsidiaries.
The Group classifies its interests in joint arrangements as either:
· Joint ventures: where the Group has rights to only the net assets
of the joint arrangement; or
· Joint operations: where the Group has both the rights to assets
and obligations for the liabilities of the joint arrangement.
In assessing the classification of interests in joint arrangements, the Group
considers:
· The structure of the joint arrangement;
· The legal form of joint arrangements structured through a
separate vehicle;
· The contractual terms of the joint arrangement agreement; and
· Any other facts and circumstances (in any other contractual
arrangements).
The Group accounts for its interests in joint ventures initially at cost in
the consolidated statement of financial position. Subsequently joint ventures
are accounted for using the equity method where the Group's share of
post-acquisition profits and losses and other comprehensive income is
recognised in the consolidated statement of profit and loss and other
comprehensive income (except for losses in excess of the Group's investment in
the associate unless there is an obligation to make good those losses).
Profits and losses arising on transactions between the Group and its joint
ventures are recognised only to the extent of unrelated investors' interests
in the joint venture. The investor's share in the joint ventures' profits and
losses resulting from these transactions is eliminated against the carrying
value of the joint venture.
Any premium paid for an investment in a joint venture above the fair value of
the Group's share of the identifiable assets, liabilities and contingent
liabilities acquired is capitalised and included in the carrying amount of the
investment in joint venture. Where there is objective evidence that the
investment in a joint venture has been impaired the carrying amount of the
investment is tested for impairment in the same way as other non-financial
assets.
The Group accounts for its interests in joint operations by recognising its
share of assets, liabilities, revenues, and expenses in accordance with its
contractually conferred rights and obligations. In accordance with IFRS 11
Joint Arrangements, the Group is required to apply all of the principles of
IFRS 3 Business Combinations when it acquires an interest in a joint operation
that constitutes a business as defined by IFRS 3.Where there is an increase in
the stake of the joint venture entity from an associate to a subsidiary and
the acquisition is considered as an asset acquisition and not a business
combination in accordance with IFRS3, this step up transaction is accounted
for as the purchase of a single asset and the cost of the transaction is
allocated in its entirety to that asset with no gain or loss recognised in the
income statement. The step-up acquisition of CRL in 2019 has been accounted
for as a purchase of a single asset and the cost of the transaction is
allocated in its entirety to that balance sheet.
Listed equity investments
Listed equity investments in an active market are usually valued at the
mid-price on the valuation date.
Business combinations
Acquisitions of subsidiaries and businesses are accounted for using the
acquisition method under IFRS3 Business Combinations ("IFRS3"). The cost of
the business combination is measured as the aggregate of the fair values (at
the date of exchange) of assets given, liabilities incurred or assumed, and
equity instruments issued by the Group and the Company in exchange for control
of the acquiree. The acquiree's identifiable assets, liabilities and
contingent liabilities that meet the relevant conditions for recognition are
recognised at their fair values at the acquisition date. Goodwill arising on
acquisition is recognised as an asset and initially measured at cost, being
the excess of the fair value of the consideration paid over the Group's
interest in the fair value of the identifiable assets, liabilities and
contingent liabilities acquired. If the Group's interest in the fair value of
the acquiree's identifiable assets, liabilities and contingent liabilities
exceeds the cost of the business combination, the excess is recognised
immediately in profit or loss. Transaction costs incurred directly in
connection with business combinations are expensed.
Impairment of non-financial assets (excluding inventories)
Other non-financial assets are subject to impairment tests whenever events or
changes in circumstances indicate that their carrying amount may not be
recoverable. Where the carrying value of an asset exceeds its recoverable
amount (i.e., the higher of value in use and fair value less costs to sell),
the asset is written down accordingly.
Where it is not possible to estimate the recoverable amount of an individual
asset, the impairment test is carried out on the smallest Group of assets to
which it belongs for which there are separately identifiable cash flows: its
cash generating units ('CGUs').
Impairment charges are included in the statement of comprehensive income,
except to the extent they reverse gains previously recognised in other
comprehensive income.
Externally acquired intangible assets
Externally acquired intangible assets are initially recognised at cost and
subsequently amortised over their useful economic lives.
Intangible assets are recognised on business combinations if they are
separable from the acquired entity or give rise to other contractual or legal
rights. The amounts ascribed to such intangibles are arrived at by using
appropriate valuation techniques (see section related to critical estimates
and judgements below).
An intangible asset was recognised in the acquisition of Leigh Creek Copper
Mine Pty Ltd and represents the fair value of the offtake agreement that was
in place at acquisition date (Note 9).
Exploration and evaluation assets
The Group has continued to apply the 'successful efforts' method of accounting
for Exploration and Evaluation ("E&E") costs, having regard to the
requirements of IFRS 6 'Exploration for the Evaluation of Mineral Resources'.
The successful efforts method means that only the costs which relate directly
to the discovery and development of specific mineral reserves are capitalised.
Such costs may include costs of licence acquisition, technical services and
studies, exploration drilling and testing but do not include costs incurred
prior to having obtained the legal rights to explore the area. Under
successful efforts accounting, exploration expenditure which is general in
nature is charged directly to the statement of comprehensive income and that
which relates to unsuccessful exploration operations, though initially
capitalised pending determination, is subsequently written off. Only costs
which relate directly to the discovery and development of specific commercial
mineral reserves will remain capitalised and to be depreciated over the lives
of these reserves. Exploration and evaluation costs are capitalised within
intangible assets. Costs incurred prior to obtaining legal rights to explore
are expensed immediately to the statement of comprehensive income.
All lease and licence acquisition costs, geological and geophysical costs and
other direct costs of exploration, evaluation and development are capitalised
as intangible or property, plant and equipment according to their nature.
Intangible assets comprise costs relating to the exploration and evaluation of
properties which the Directors consider to be unevaluated until reserves are
appraised as commercial, at which time they are transferred to tangible assets
as 'Developed mineral assets' following an impairment review and depreciated
accordingly. Where properties are appraised to have no commercial value, the
associated costs are treated as an impairment loss in the period in which the
determination is made. Management considers all tenements relating to each
project to represent one asset when undertaking their impairment assessment.
Property, plant, and equipment
Items of property, plant and equipment are initially recognised at cost. As
well as the purchase price, cost includes directly attributable costs.
Depreciation is provided on all items of property, plant, and equipment so as
to write off their carrying value over their expected useful economic lives.
It is provided at the following rates:
· Plant and machinery (except screening equipment) - 5 to 10 years
straight line basis
· Screening Equipment - on a unit of production basis
· Mining assets - on a unit of production basis
The carrying value of property, plant and equipment assets is assessed
annually and any impairment is recorded in the statement of comprehensive
income.
Investments in subsidiaries - company only
Investments in subsidiaries are stated at cost less provision for any
impairment in value.
If circumstances indicate that impairment may exist, investments in subsidiary
undertakings of the Company are evaluated using market values, where
available, or the discounted expected future cash flows of the investment.
If these cash flows are lower than the Company's carrying value of the
investment an impairment charge is recorded in the Company.
Loans to subsidiaries - company only
Loans to subsidiaries are stated at cost less provision for expected credit
losses ("ECL's).
The Company recognises an ECL's on intercompany loans, based on management's
assessment and understanding of the credit risk attaching to each asset,
changes in the level of credit risk between periods and an assessment of the
scenarios under which management expect the assets to be repaid.
Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held on call with
under 90 days maturity with banks.
Revenue
Revenue from the sale of magnetite is recognised when the Group passes control
of the product to the customer, and it is probable the Group will receive the
funds. Control is considered to have passed when the goods are passed to the
buyer, being the point of leaving the mine gate for domestic sales to the US
markets. This is point in time when revenue is recognised.
Where a contract allows the Group to advance bill ahead of delivery, a
contract liability in relation to the outstanding performance obligation is
only recognised on the date when payment is received. In those cases, the
entity recognises revenue only after it transfers the goods to the buyer.
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of
cost and net realisable value. Cost comprises all costs of purchase, costs of
conversion and other costs incurred in bringing the inventories to their
present location and condition.
Taxation
Income tax
Income tax expense represents the sum of the tax currently payable and
deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from profit as reported in the same income statement because it
excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The
Group's liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the statement of financial position date.
Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount
of an asset or liability in the consolidated statement of financial position
differs from its tax base, except for differences arising on:
· the initial recognition of an asset or liability in a transaction
which is not a business combination and at the time of the transaction affects
neither accounting or taxable profit; and
· investments in subsidiaries where the Group is able to control
the timing of the reversal of the difference and it is probable that the
difference will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it
is probable that taxable profit will be available against which the difference
can be utilised. The Group has not recognised any deferred tax at the balance
date.
When an asset or liability is raised the amount of the asset or liability is
determined using tax rates that have been enacted or substantively enacted by
the reporting date and are expected to apply when the deferred tax
liabilities/(assets) are settled/(recovered).
Fair values
The carrying amounts of the financial assets and liabilities such as cash and
cash equivalents, receivables and payables of the Group at the statement of
financial position date approximated their fair values, due to the relatively
short-term nature of these financial instruments.
Share-based compensation
The fair value of the employee and suppliers' services received in exchange
for the grant of options and warrants is recognised as an expense. The total
amount to be expensed over the vesting period is determined by reference to
the fair value of the options and warrants granted, excluding the impact of
any non-market vesting conditions (for example, profitability and sales growth
targets). Non-market vesting conditions are included in assumptions about the
number of options and warrants that are expected to vest. At each statement of
financial position date, the entity revises its estimates of the number of
options and warrants that are expected to vest. It recognises the impact of
the revision to original estimates, if any, in the statement of comprehensive
income, with a corresponding adjustment to equity.
The proceeds received net of any directly attributable transaction costs are
credited to share capital (nominal value) and share premium when the options
and warrants are exercised.
The fair value of share-based payments recognised in the statement of
comprehensive income is measured by use of the Black Scholes model or other
appropriate models, which takes into account conditions attached to the
vesting and exercise of the equity instruments. The expected life used in the
model is adjusted; based on management's best estimate, for the effects of
non-transferability, and exercise restrictions. The share price volatility
percentage factor used in the calculation is based on management's best
estimate of future share price behaviour and is selected based on past
experience.
Equity instruments
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options
are shown in equity as a deduction, net of tax, from proceeds.
The fair value of warrants is credited to warrants reserve. The warrants
reserve is non-distributable and will be transferred to share premium account
upon the exercise of warrants. The balance of the warrants reserve in relation
to unexercised warrants at the expiry of the warrants period will be
transferred to accumulated profits.
Provisions
Provisions are recognised when the Group has a present obligation as a result
of a past event, and it is probable that the Group will be required to settle
that obligation. Provisions are measured at the Directors' best estimate of
the expenditure required to settle the obligation at the statement of
financial position date and are discounted to present value where the effect
is material.
Provisions for decommissioning costs are recognised in accordance with IAS 37
Provisions, Contingent Liabilities and Contingent Assets. Provisions are
recorded at the present value of the expenditures expected to be required to
settle the Group's future obligations. Provisions are reviewed at each
reporting date to reflect the current best estimate of the cost at present
value. Any change in the date on which provisions fall due will change the
present value of the provision. Any change in the present value of the
estimated future expenditure is reflected and adjusted against the provision
and development asset, unless the asset to which the provision relates has
been impaired, in which case the reversal of the provision is taken through
the Consolidated statement of comprehensive income. The increase in
restoration provisions, owing to the passage of time, is charged to the
consolidated statement of comprehensive income as a finance expense.
Financial instruments
Non-derivative financial instruments comprise trade and other receivables,
cash and cash equivalents, loans and borrowings, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value
plus any directly attributable transactions costs and are subsequently carried
at amortised cost.
A financial instrument is recognised when the Group becomes a party to the
contractual provisions of the instrument. Financial assets are derecognised if
the Group's contractual rights to the cash flows from the financial assets
expire or if the Group transfers the financial assets to another party without
retaining control or substantially all risks and rewards of the asset. Regular
purchases and sales of financial assets are accounted for at trade date, i.e.,
the date that the Group commits itself to purchase or sell the asset.
Financial liabilities are derecognised if the Group's obligations specified in
the contract expire or are discharged or cancelled.
Financial assets
All financial assets other than an immaterial investment in listed equity
shares, which are measured at fair value through profit or loss, are
classified as financial assets at amortised cost. The Group determines the
classification of its financial assets at initial recognition.
The Group's financial assets include cash and cash equivalents, trade
receivables and other receivables.
The Company's financial assets include cash and cash equivalents and loans
receivable due from subsidiaries.
The Company recognises a loss allowance for expected credit losses ("ECL") on
intercompany loans which are measured at amortised cost. The amount of
expected credit losses is updated at each reporting date to reflect changes in
credit risk since initial recognition of the respective financial instrument.
If the credit risk on a financial instrument has increased significantly since
initial recognition, the loss allowance is equal to the lifetime expected
credit losses. If the credit risk has not increased significantly, the loss
allowance is equal to the twelve month expected credit losses.
The Group applies the IFRS 9 simplified approach to measuring credit losses
using a lifetime expected credit loss provision for trade receivables.
Further details of the reviews undertaking during the year are set out in Note
3.
Financial liabilities
Financial liabilities refer to trade payables, other payables and loans and
borrowings (including the host borrowing in a convertible instrument) and are
initially recognised at fair value net of any transaction costs directly
attributable to the issue of the instrument. Such liabilities are subsequently
measured at amortised cost using the effective interest rate method.
All loans and borrowings which are financial instruments are initially
recognised at the present value of cash payable to the lender (including
interest). After initial recognition they are measured at amortised cost using
the effective interest rate method. The effective interest rate amortisation
is included in finance costs in the income statement.
Where there is a significant modification to a financial liability, the
financial original liability is de-recognised, and a new financial liability
is recognised at fair value in accordance with the Group's policy.
Convertible loan notes are assessed in accordance with IAS 32 Financial
Instruments: Presentation to determine whether the conversion element meets
the fixed-for-fixed criterion. Where this is met, the instrument is accounted
for as a compound financial instrument with appropriate presentation of the
liability and equity components. Where the fixed-for-fixed criterion is not
met, the conversion element is accounted for separately as an embedded
derivative which is measured at fair value through profit or loss. On issue of
a convertible borrowing, the fair value of embedded derivative is determined,
and the residual is recorded as a host liability initially at fair value and
subsequently at amortised cost. Issue costs are apportioned between the
components based on their respective carrying amounts when the instrument was
issued. The finance costs recognised in respect of the convertible borrowings
includes the accretion of the liability.
Foreign currencies
Transactions entered into by Group entities in a currency other than the
currency of the primary economic environment in which they operate (their
"functional currency") are recorded at the rates ruling when the transactions
occur. The functional currency of the Company is deemed to be GBP. Foreign
currency monetary assets and liabilities are translated at the rates ruling at
the reporting date. Exchange differences arising on the retranslation of
unsettled monetary assets and liabilities are recognised immediately in profit
or loss, except for foreign currency borrowings qualifying as a hedge of a net
investment in a foreign operation, in which case exchange differences are
recognised in other comprehensive income and accumulated in the foreign
exchange reserve along with the exchange differences arising on the
retranslation of the foreign operation.
On consolidation, the results of overseas operations are translated into US
Dollars at rates approximating to those ruling when the transactions took
place. All assets and liabilities of overseas operations, including goodwill
arising on the acquisition of those operations, are translated at the rate
ruling at the reporting date. Exchange differences arising on translating the
opening net assets at opening rate and the results of overseas operations at
actual rate are recognised in other comprehensive income and accumulated in
the foreign exchange reserve.
On disposal of a foreign operation, the cumulative exchange differences
recognised in the foreign exchange reserve relating to that operation up to
the date of disposal are transferred to the consolidated statement of
comprehensive income as part of the gain or loss on disposal.
Management of capital
The Group's policy is to ensure that it will always have sufficient cash to
allow it to meet its liabilities when they become due. The principal
liabilities of the Group arise in respect of the costs of financing working
capital as inventory is built up prior to sale.
The Board receives periodic cash flow projections as well as information on
cash balances. The Board will not commit to material expenditure prior to
being satisfied that sufficient funding is available to the Group to finance
the planned programmes.
Research and Development Tax Incentive (RDTI)
The Group's policy is that any RDTI should be recognised as a government
grant, in accordance with IAS20 Accounting for Government Grants. This means
it will be recognised as part of profit before tax, either as income or as a
reduction of the associated costs.
Where the Group capitalises development costs, then the RDTI amounts received
that relate to these costs will be offset against the capitalised development
costs or deferred exploration expenditure as the case may be.
Leases
All leases are accounted for by recognising a right-of-use asset and a lease
liability except for:
- Leases of low-value assets; and
- Leases with a duration of twelve months or less.
Lease liabilities are measured at the present value of the contractual
payments due to the lessor over the lease term, with the discount rate
determined by reference to the rate inherent in the lease unless (as is
typically the case) this is not readily determinable, in which case the
Group's incremental borrowing rate on commencement of the lease is used.
Variable lease payments are only included in the measurement of the lease
liability if they depend on an index or rate. In such cases, the initial
measurement of the lease liability assumes the variable element will remain
unchanged throughout the lease term. Other variable lease payments are
expensed in the period to which they relate.
On initial recognition, the carrying value of the lease liability also
includes:
- Amounts expected to be payable under any residual value guarantee;
- The exercise price of any purchase option granted in favour of the Group
if it is reasonably certain to assess that option; and
- Any penalties payable for terminating the lease, if the term of the lease
has been estimated on the basis of termination option being exercised.
Right-of-use assets are initially measured at the amount of the lease
liability, reduced for any lease incentives received, and increased for:
- Lease payments made at or before commencement of the lease;
- Initial direct costs incurred; and
- The amount of any provision recognised where the Group is contractually
required to dismantle, remove, or restore the leased asset.
Subsequent to initial measurement lease liabilities increase as a result of
interest charged at a constant rate on the balance outstanding and are reduced
for lease payments made. Right-of-use assets are amortised on a straight-line
basis over the remaining term of the lease or over the remaining economic life
of the asset if, rarely, this is judged to be shorter than the lease term.
When the Group revises its estimate of the term of any lease (because, for
example, it re-assesses the probability of a lessee extension or termination
option being exercised), it adjusts the carrying amount of the lease liability
to reflect the payments to make over the revised term, which are discounted at
the same discount rate that applied on lease commencement. The carrying value
of lease liabilities is similarly revised when the variable element of future
lease payments dependent on a rate or index is revised. In both cases an
equivalent adjustment is made to the carrying value of the right-of-use asset,
with the revised carrying amount being amortised over the remaining (revised)
lease term.
Government Grants
Government grants received on capital expenditure are generally deducted in
arriving at the carrying amount of the asset purchased. Grants for revenue
expenditure are netted against the cost incurred by the Group. Where retention
of a government grant is dependent on the Group satisfying certain criteria,
it is initially recognised as deferred income. When the criteria for retention
have been satisfied, the deferred income balance is released to the
consolidated statement of comprehensive income or netted against the asset
purchased.
Assets and liabilities held for Sale
Non-current assets (or disposal groups) are classified as assets and
liabilities held for sale when their carrying amount is to be recovered
principally through a sale transaction and a sale is considered highly
probable. They are stated at the lower of carrying amount and fair value less
costs to sell and are presented separately in the income statement as
discontinued operations, and the associated assets and liabilities of the
disposal group are presented as separate line items in the Consolidated
Statement of Financial Position as Group disposal assets and Group disposal
liabilities.
2. Critical accounting estimates and judgements
The Group makes certain estimates and assumptions regarding the future.
Estimates and judgements are continually evaluated based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. In the future, actual
experience may differ from these estimates and assumptions. The estimates and
assumptions that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next financial year
are discussed below.
Estimates
(a) Carrying value of intangible assets
Management assesses the carrying value of the exploration and evaluation
assets for indicators of impairment based on the requirements of IFRS 6 which
are inherently judgemental. This includes ensuring the Group maintains legal
title, assessment regarding the commerciality of reserves and the clear
intention and financial ability to move the asset forward to development.
i) The Redmoor Project is an early-stage exploration projects and
therefore management have applied judgement in the period as to whether the
results from exploration activity provide sufficient evidence to continue to
move the asset forward to development. There are no indicators of impairment
for the Redmoor Project in the 31 December 2024 financial year.
ii) The intangible asset associated with the offtake agreement for the
LCCM project was impaired to nil at 31 December 2023. The asset continues to
be impaired to nil at 31 December 2024.
Further detail regarding the carrying value of exploration and evaluation can
be found in Note 9.
(b) Share based payments
The fair value of share-based payments recognised in the statement of
comprehensive income is measured by use of the Black Scholes model after
taking into account market-based vesting conditions and conditions attached to
the vesting and exercise of the equity instruments. The expected life used in
the model is adjusted based on management's best estimate, for the effects of
non-transferability, exercise restrictions and behavioural considerations. The
share price volatility percentage factor used in the calculation is based on
management's best estimate of future share price behaviour based on past
experience. Further details are given in Note 20.
(c) Carrying value of amounts owed by subsidiary undertakings.
IFRS 9 requires the parent company to make certain assumptions when
implementing the forward- looking expected credit loss model. This model is
required to be used to assess the intercompany loan receivables from its
subsidiaries for impairment. Arriving at an expected credit loss allowance
involved considering different scenarios for the recovery of the intercompany
loan receivables, the possible credit losses that could arise and
probabilities for these scenarios.
The following were considered: the exploration project risk, the future sales
potential of product, value of potential reserves and the resulting expected
economic outcomes of the project. Further details are given in Note 10.
(d) Carrying Value of Development Assets
Management assesses the carrying value of Development assets for indicators of
impairment based on the requirements of IAS36 which are inherently
judgemental.
The following are the key assumptions used in this assessment of carrying
value.
i) Mineable reserves over life of project
ii) Forecasted Copper pricing
iii) Capital and operating cost assumptions to deliver the mining schedule
iv) Foreign exchange rates
v) Discount rate
If the carrying amount of the Development asset exceeds the recoverable
amount, the asset is impaired. The Group will reduce the carrying amount of
the asset to its recoverable amount and recognise an impairment loss. The
assessment is carried out twice per year - end of half year reporting period
and end of annual reporting period.
2024 Assessment
Additions to the Development asset recognised in respect of LCCM in 2024
represent ongoing costs associated with maintaining the asset.
The Group has reduced the carrying amount of the asset to nil recognising an
impairment loss of $0.113m at 31 December 2024 (2023: $8.898m) in profit or
loss.
Despite the Board's ongoing efforts to secure funding, a transaction was not
achieved in the year ended 31 December 2024. Accordingly, the Board has
assessed that indicators for impairment exist at 31 December 2024.
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
- The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days from 23 April (or such further period
as may be agreed by the parties), for an exclusive call option to acquire 100%
of LCCM (the "Call Option"). On 23 May 2025, the period was extended by 14
days.
- Under the Call Option, which will be exercisable for a period of six
months (or such longer period as may be agreed by the parties), the purchaser
may elect to acquire 100% of LCCM for an initial payment to Strategic
Minerals of A$1.9 million in cash.
- The purchaser anticipates completing a listing on the Australian
Securities Exchange upon which it will issue shares to Strategic
Minerals equivalent to 19.9% of the listed vehicle up to a maximum value
limit of A$3 million.
- The purchaser will pay an earn-out to Strategic Minerals equivalent
to A$4 million ("Earn-Out Consideration") to be paid on a half yearly basis
from the commencement of commercial production at the Project with each half
yearly payment to be the equivalent of 20% of net free cash flows from the
prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
The group has accrued for an environmental bond, as detailed in Notes 15,22
and 28, due to the Department of Energy and Mining, South Australian
Government, for $1.082m at 31 December 2024. If under the Call Option the
purchaser elects not to acquire 100% of Leigh Creek Copper Mine Pty Ltd the
environmental bond will remain payable by the group likely within twelve
months from the date of signing these financial statements. Management's cash
flow forecast for the period to 31 December 2026 does not include the payment
of the environmental bond. If the environmental bond is not paid then
potentially the mineral lease, which is due to be renewed in October 2025, may
be cancelled by the Department of Energy and Mining. Due to the unpredictable
outcome of whether the purchaser will elect to acquire 100% of Leigh Creek
Copper Mine Pty Ltd in the six-month exercise period from 11 June 2025 the
impact on the group and the company cannot be predicted with any certainty.
(e) Determination of incremental borrowing rate for leases
Under IFRS 16, where the interest rate implicit in the lease cannot be readily
determined the incremental borrowing rate is used. The incremental borrowing
rate is defined as the rate of interest that a lessee would have to pay to
borrow, over a similar term and with a similar security, the funds necessary
to obtain an asset of a similar value to the cost of the right-of-use asset in
a similar economic environment.
Plant and Machinery
The Group has continued to apply a borrowing rate of 9.75% to the Plant and
Machinery Asset- the interest expense is $8,045 (2023: $7,803). The lease was
renewed again in March 2024, however, the liability for this renewal is
$150,114 and was taken up on 31 December 2023 at a borrowing rate of 9.75%.
The lease terminated on 31 March 2025.
Car lease
The Group has continued to apply a borrowing rate of 6% to the car lease - the
interest expense is $785 (2023: $932).
The lease was renewed in February 2023 for 5 years. The liability for this
renewal is $17,375 which was recognised on 31 December 2022 at a borrowing
rate of 6%.
Loader Lease
In December 2024, SMG commenced a 4-year instalment sale contract for a 980
Caterpillar loader. The liability for the loader is $674,957 at a contract
borrowing rate of 5.577%.
Excavator Lease
In December 2024, SMG entered 4-year instalment sale contract for a 320-07
Caterpillar excavator. The liability for the loader is $300,763 at a contract
borrowing rate of 3.234%.
Refer to Note 18 for details in relation to lease arrangements.
(f) Disposal group (assets for sale)
The Company is actively marketing LCCM to several national and international
buyers and does not intend to develop the LCCM project itself.
The Directors have assessed that LCCM currently meets the criteria for
disclosure under IFRS 5 - Non-current Assets Held for Sale and Discontinued
Operations.
Consequently, LCCM has been categorised as a disposal group (asset held for
sale) in the Consolidated Financial Statements.
Judgements
(g) Investments in subsidiaries
Investment in subsidiaries comprises the cost of acquiring shares in
subsidiaries.
If an impairment trigger is identified and investments in subsidiaries are
tested for impairment, estimates are used to determine the expected net return
on investment. The estimated return on investment takes into account the
underlying economic factors in the business of the Company's subsidiaries
including estimated recoverable reserves, resources prices, capital investment
requirements, and discount rates among other things. Refer to Note 10 for
further details in respect of the recoverability of the investment in
subsidiaries.
(h) Contingent consideration as part of asset acquisition
Judgement is required in determining the accounting for the contingent
consideration payable in respect of the CRL acquisition. The Group has an
obligation to pay A$1m on net smelter sales arising from CRL production
reaching A$50m and a further A$1m on net smelter sales arising from CRL
production reaching A$100m.
Whilst a possible obligation exists in relation to the consideration payable,
given the early stage of the project it was concluded that at the reporting
date it is not probable that an outflow of resources embodying economic
benefits will be required to settle the obligation. Therefore, in accordance
with IAS 37, a contingent liability, relating to this possible obligation is
disclosed in Note 23.
(i) Contingent consideration -LCCM Bond B Payable
Judgement was required in determining the accounting for the contingent
consideration payable for the LCCM Environmental Bond, as determined by the
Government of South Australia under the July 2022 PEPR. The Group has an
obligation to pay a A$1.140m bond prior to commencement of authorised
operations at the LCCM site. This Bond B addresses future liabilities
resulting from operations as described in the PEPR.
Whilst a possible obligation exists in relation to the consideration payable,
given the project is not in operation, it was concluded that at the reporting
date it is not probable that an outflow of resources embodying economic
benefits will be required to settle the obligation. Therefore, in accordance
with IAS 37, a contingent liability, relating to this possible obligation is
disclosed in Note 23.
3. Financial instruments - Risk management
The Group is exposed to the following financial risks:
· Credit risk
· Foreign exchange risk
· Commodity price risk
· Liquidity risk
In common with all other businesses, the Group is exposed to risks that arise
from its use of financial instruments. This note describes the Group's
objectives, policies, and processes for managing those risks and the methods
used to measure them.
There have been no substantive changes in the Group's exposure to financial
instrument risks, its objectives, policies, and processes for managing those
risks or the methods used to measure them from last year unless otherwise
stated in this note.
Principal financial instruments
The principal financial instruments used by the Group, from which financial
instrument risk arises, are:
· Trade and other receivables
· Cash and cash equivalents
· Trade and other payables
· Lease liabilities
· Borrowings
A summary of the financial instruments held by category is provided below:
Financial assets at
amortised cost
2024 2023
Group $'000 $'000
Cash and cash equivalents 621 112
Assets held for sale 127 -
Trade and other receivables 277 205
_______ _______
Total financial assets 1,025 317
_______ _______
Financial liabilities at
amortised cost
As restated
2024 2023
Group $'000 $'000
Trade and other payables 150 2,024
Liabilities held by Group for resale 1,098 -
Lease liabilities 1,106 455
_______ _______
Total financial liabilities 2,354 2,479
_______ _______
Financial assets at
amortised cost
2024 2023
Company $'000 $'000
Cash and cash equivalents 14 7
Amounts owed by subsidiary undertakings 1,431 1,066
_______ _______
Total financial assets at amortised cost 1,445 1,073
_______ _______
Financial liabilities at
amortised cost
2024 2023
Company $'000 $'000
Trade and other payables 110 197
Amounts owed to subsidiary undertakings 3,677 2,230
_______ _______
Total financial liabilities 3,787 2,427
_______ _______
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group's risk
management objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority for designing and
operating processes that ensure the effective implementation of the objectives
and policies to the Group's finance function. The overall objective of the
Board is to set policies that seek to reduce risk as far as possible without
unduly affecting the Group's competitiveness and flexibility. Further details
regarding these policies are set out below:
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations. The Group is mainly exposed to credit risk from credit sales. It
is Group policy, implemented locally, to assess the credit risk of new
customers before entering contracts. Such credit assessments are taken into
account by local business practices. Further disclosures regarding trade and
other receivables, which follow IFRS 9 including expected credit losses, are
provided for in Note 13.
The Company is exposed to credit risk through amounts due from its subsidiary
undertakings. Refer to Note 1 for details on the credit loss allowance made.
Credit risk also arises from cash and cash equivalents and deposits with banks
and financial institutions. For banks and financial institutions, only
independently rated parties with minimum rating "A" are accepted.
Foreign exchange risk
Foreign exchange risk arises when individual Group entities enter into
transactions denominated in a currency other than their functional currency.
The Group's policy is, where possible, to allow Group entities to settle
liabilities denominated in their own functional currency (being Pound
Sterling, US dollar and Australian dollar) with the cash generated from their
own operations where possible in that currency. Where Group entities have
liabilities denominated in a currency other than their functional currency
(and have insufficient reserves of that currency to settle them), cash already
denominated in that currency will, where possible, be transferred from
elsewhere within the Group.
The parent Company maintains US dollar and pounds sterling bank accounts,
whilst subsidiaries may hold either these currency accounts or their local
currency.
All receivables and payables are settled at the prevailing spot rate; no
forward contracts or other hedging instruments are currently entered into. The
Board monitors the total foreign exchange risk on a periodic basis but given
the major in and out flows of cash are in US dollars there is a natural hedge
in place which minimises the overall exposure.
As of 31 December, the net exposure to foreign exchange risk was as follows:
Net foreign currency financial assets/(liabilities)
US dollar Sterling Australian dollar Total
2024 2023 2024 2023 2024 2023 2024 2023
$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Group
______ ______ ______ ______ ______ ______ ______ ______
Total net exposure (664) (269) (20) (306) (645) (395) (1,329) (970)
______ ______ ______ ______ ______ ______ ______ ______
The effect of a 20% strengthening of the Sterling and Australian Dollar
against the US Dollar at the reporting date on the corresponding net financial
assets carried at that date would, all other variables held constant, have
resulted in an increase in the post-tax profit for the year of $133,000 (2023:
$140,000) and an increase in the net assets of $133,000 (2023: $140,000) A 20%
weakening in the exchange rate would, on the same basis, have decreased
post-tax profit and decreased net assets by $133,000 (2023: $140,000).
Net foreign currency financial assets/(liabilities)
Functional currency of individual entity
Sterling Total
2024 2023 2024 2023
$'000 $'000 $'000 $'000
Company
______ ______ ______ ______
Total net exposure (4) (190) (4) (190)
______ ______ ______ ______
Commodity price risk
Typically, the sale of magnetite to the export market, as opposed to US
domestic customers, is priced by reference to the market quoted Platts IODEX
62% Fe CFR China price over which the Group has no influence. There were no
exports of product in the 2024 year. As domestic sales prices are determined
more by local supply/demand factors and transportation costs, they do not,
generally fluctuate with changes in global prices, hence, there is no
significant exposure to market price risks expected in the coming year.
Liquidity risk
Liquidity risk arises from the Group's management of working capital.
The Group's policy is to ensure that it will always have sufficient cash to
allow it to meet its liabilities when they become due. To achieve this aim, it
seeks to maintain cash balances to meet expected requirements for a period of
at least 30 days.
The Board receives periodic cash flow projections as well as information
regarding cash balances. The Group does not have any overdraft or credit lines
in place. The liquidity risk of each Group entity is managed centrally by the
finance function.
The following table sets out the contractual maturities (representing
undiscounted contractual cash-flows) of financial liabilities:
Between Between Between
Group Up to 3 3 and 12 1 and 2 2 and 5 Over
months Months year Years 5 years
At 31 December 2024 $'000 $'000 $'000 $'000 $'000
Trade and other payables 150 - - - -
Liabilities for sale - 1,098 - - -
Lease liabilities 134 235 209 528 -
_______ _______ _______ _______ _______
Total 284 1,333 209 528 -
_______ _______ _______ _______ _______
Between Between Between
Group - As restated Up to 3 3 and 12 1 and 2 2 and 5 Over
months months year years 5 years
At 31 December 2023 $'000 $'000 $'000 $'000 $'000
Trade and other payables 832 - - - -
Lease liabilities 38 115 172 130 -
_______ _______ _______ _______ _______
Total 870 115 172 130 -
_______ _______ _______ _______ _______
Between Between Between
Company Up to 3 3 and 12 1 and 2 2 and 5 Over
months months year years 5 years
At 31 December 2024 $'000 $'000 $'000 $'000 $'000
Trade and other payables 110 - - - -
Loans from subsidiary undertakings - 3,677 - - -
_______ _______ _______ _______ _______
Total 110 3,677 - - -
_______ _______ _______ _______ _______
Between Between Between
Company Up to 3 3 and 12 1 and 2 2 and 5 Over
months months year years 5 years
At 31 December 2023 $'000 $'000 $'000 $'000 $'000
Trade and other payables 54 - - - -
Loans and borrowings - 1,919 - - -
_______ _______ _______ _______ _______
Total 54 1,919 - - -
_______ _______ _______ _______ _______
Capital Disclosures
The Group monitors "adjusted capital" which comprises all components of equity
(i.e., share capital, share premium, merger reserve, and retained earnings).
The Group's objectives when maintaining capital are:
· to safeguard the entity's ability to continue as a going concern,
so that it can continue to provide returns for shareholders and benefits for
other stakeholders;and
· to provide an adequate return to shareholders by pricing products
with the level of risk.
The Group sets the amount of capital it requires in proportion to risk. The
Group manages its capital structure and adjusts it in the light of changes in
economic conditions and the risk characteristics of the underlying assets.
4. Segment information
The Group has four main segments during the period:
· Southern Minerals Group LLC (SMG) - This segment is involved in
the sale of magnetite to both the US domestic market and historically
transported magnetite to port for onward export sale.
· Head Office - This segment incurs all the administrative costs of
central operations and finances the Group's operations. A management fee is
charged for completing this service and other certain services and expenses.
· Development Asset - discontinued - This segment holds the Leigh
Creek Copper Mine Development Asset in Australia and incurs all related
operating costs.
· United Kingdom - The investment in the Redmoor Project in
Cornwall, United Kingdom is held by this segment.
Factors that management used to identify the Group's reportable segments.
The Group's reportable segments are strategic business units that carry out
different functions and operations and operate in different jurisdictions.
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating
decision maker has been identified as the Board and management team which
includes the Board and the Chief Financial Officer.
Measurement of operating segment profit or loss, assets, and liabilities
The Group evaluates segmental performance on the basis of profit or loss from
operations calculated in accordance with UK-adopted International Accounting
Standards.
Segment assets exclude tax assets and assets used primarily for corporate
purposes. Segment liabilities exclude tax liabilities. Loans and borrowings
are allocated to the segments in which the borrowings are held. Details are
provided in the reconciliation from segment assets and liabilities to the
Group's statement of financial position.
SMG Head Office United Kingdom Development Asset- discontinued Intra Segment Elimination Total
2024 2024 2024 2024 2024 2024
$'000 $'000 $'000 $'000 $'000 $'000
Revenues 4,745 - - - - 4,745
Total Revenue 4,745 - - - - 4,745
Raw Materials and consumables (846) - - - - (846)
Overhead expenses (737) (618) (19) - - (1,374)
Management fee income/(expense) (100) 102 - - (2) -
Amortisation- right of use asset (334) - - - - (334)
Depreciation (18) - - - - (18)
Interest - (9) - - - (9)
Foreign exchange gain/(loss) - (933) - - 920 (13)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) from operations
2,710 (1,458) (19) - 918 2,151
_______ _______ _______ _______ _______ _______
Lease interest (19) - - - - (19)
Finance expense - (11) (12) - - (23)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) before taxation
2,691 (1,469) (31) - 918 2,109
_______ _______ _______ _______ _______ _______
Taxation (691) - - - - (691)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) continuing operations
2,000 (1,469) (31) - 918 1,418
Segment loss from discontinued operations
- - - (113) - (113)
_______ _______ _______ _______ _______ _______
Segment profit/ (loss) 2,000 (1,469) (31) (113) 918 1,305
_______ _______ _______ _______ _______ _______
As restated As restated
SMG Head United Kingdom Development Asset Intra Total
Office Segment
Elimination
2023 2023 2023 2023 2023 2023
$'000 $'000 $'000 $'000 $'000 $'000
Revenues 1,577 - - - - 1,577
Total Revenue 1,577 - - - - 1,577
Other Revenue 1 - 3 - - 4
Raw Materials and consumables (262) - - - - (262)
Overhead expenses (478) (627) (56) - - (1,161)
Management fee income/(expense) (250) 250 - - - -
Impairment - - - (8,898) - (8,898)
Share based payments - (5) - - - (5)
Amortisation- right of use asset (277) - - - - (277)
Depreciation (16) - - - - (16)
Interest (6) (18) (24)
(Loss)/ gain on intercompany loans/investments - (3,377) - - 3,377 -
Foreign exchange gain/(loss) - (227) - - 221 (6)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) from operations
289 (4,004) (53) (8,898) 3,598 (9,068)
_______ _______ _______ _______ _______ _______
Lease interest (14) - - - - (14)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) before taxation
275 (4,004) (53) (8,898) 3,598 (9,082)
_______ _______ _______ _______ _______ _______
Taxation (73) - - - - (73)
_______ _______ _______ _______ _______ _______
Segment profit /(loss) continuing operations
202 (4,004) (53) (8,898) 3,598 (9,155)
_______ _______ _______ _______ _______ _______
SMG Head Office Development Asset-discontinued United Kingdom Total
As at 31 December 2024 $'000 $'000 $'000 $'000 $'000
Additions to non-current assets - - 113 418 531
_______ _______ ______ _______ _______
Reportable segment assets 1,649 397 127 5,924 8,097
_______ _______ ______ _______ _______
Reportable 1,854 153 1,098 26 3,131
segment liabilities
_______ _______ _______ _______ _______
Restated SMG Head Office Development Asset United Kingdom Total
As at 31 December 2024 $'000 $'000 $'000 $'000 $'000
Additions to non-current assets - - 203 366 569
_______ _______ ______ _______ _______
Reportable segment assets 837 30 137 5,599 6,603
_______ _______ ______ _______ _______
Reportable segment liabilities 772 730 1,242 127 2,871
_______ _______ _______ _______ _______
External revenue Non-current assets
by location of customers
by location of assets
2024 2023 2024 2023
$'000 $'000 $'000 $'000
United States 4,745 1,577 1,104 516
United Kingdom - - 5,910 5,585
Australia (Development Asset- discontinued) - - - 136
_______ _______ _______ _______
4,745 1,577 7,014 6,237
_______ _______ _______ _______
Revenues from Customer A totalled $880,335 (2023: $546,535), which represented
19% (2023: 35%) of total sales, Customer B $2,440,677 (2023: $nil) which
represented 51% (2023:0%) of total sales and Customer C totalled $797,754
(2023: $819,000) which represented 17% (2023: 52%).
5. Profit/(loss) before tax
Group Year to Year to
31 December
31 December
Costs by nature 2024 2023
Notes $'000 $'000
Operating Profit/(loss) is stated after charging:
Other Income (i) - (4)
________ ________
Directors' fees and emoluments 6 160 257
Fees payable to the company's auditor for the audit of the parent company and 89 81
consolidated financial statements
Non-audit services - -
Staff costs 6 686 405
Depreciation 18 16
Amortisation of right-of -use assets 334 277
Equipment rental (ii) 11 2
Equipment maintenance 60 30
Legal, professional and consultancy fees 138 189
Travelling and related costs - -
Other expenses 230 198
________ ________
Overhead expenses 1,726 1,455
Foreign exchange loss 13 5
Share based payments charge - 5
Interest 9 24
Finance fee 23 -
________ ________
45 34
Other expenses
Lease interest 19 14
Loss from discontinued operations 26 113 8,898
________ ________
1,903 10,397
________ ________
(i) CRL hired mud mats on a casual basis to a non-related
party.
(ii) Equipment hire includes a number of short-term rentals.
6. Directors and employees
Group Year to Year to
31 December
31 December
Staff costs during the year 2024 2023
$'000 $'000
Directors' remuneration expense including consulting fees 74 181
Directors' remuneration - salary and wages 78 67
Directors' remuneration Pension costs 8 9
Directors' fees capitalised including consulting fees - 122
Wages and salaries including consulting fees for management* 656 405
Social security costs 30 -
________ ________
Total staff costs 846 784
________ ________
*Includes $94,000 (2023: $57,000) paid to the Chief Financial
Officer, who is the only key management personnel.
Details of the highest paid Director are disclosed in the Remuneration
Committee Report on pages 29 and 30.
The average number of people (including Directors) employed by the Group
during the year was:
2024 2023
Number Number
Total 12 11
________ ________
Company Year to Year to
31 December
31 December
Staff costs during the year 2024 2023
$'000 $'000
Directors' remuneration including consulting fees 30 153
Directors' remuneration - salary and wages 78 67
Directors' remuneration Pension costs 8 9
Directors' fees capitalised including consulting fees - 122
________ ________
Total staff costs 116 351
________ ________
The average number of people (including Directors) employed by the Company
during the year was:
2024 2023
Number Number
Total 3 3
________ ________
The number of directors to whom retirement benefits under money purchase
pension schemes is nil (2023: nil).
At 31 December 2024, no Directors or key management personnel have any accrued
short term, post-employment, long term, termination benefits or share based
payments. (2023: nil).
7. Taxation
As restated
Year to Year to
31 December
31 December
2024 2023
$'000 $'000
Current tax expense - Overseas Tax (USA) 537 107
Deferred tax expense/ (credit) 154 (34)
________ ________
691 73
________ ________
Reconciliation of effective tax rates $'000 $'000
Profit/(loss) before tax 1,996 (9,082)
Tax at the UK standard rate of corporation tax of 25% (2023 - 19%) 499 (1,726)
Effect of
Expenses not deductible for tax / (non-taxable income) 93 1,707
Allowable deductions (275) (30)
Under provision in respect of previous years 12 6
Movement in deferred tax 154 (34)
Losses carried forward 174 128
Difference in overseas tax rates 34 22
________ ________
691 73
________ ________
The Group has a tax payable of $0.415m (2023: payable $0.70m).
The Group has restated the income tax expense for the year ended 31 December
2023, to recognise the movement in the deferred tax liability between 1
January 2023 and 31 January 2023 following the restatement of the deferred tax
liability at 1 January 2023. (see Note 28)
The Group has unused losses to carry forward of $26,176,847 (2023:
$25,529,479). No deferred tax asset has been recognised for losses as their
recovery is not probable in the foreseeable future.
Different tax rates applied in overseas jurisdictions reflect the different
tax rates applicable in the various jurisdictions in which the Group operates.
The current tax expense and over provision in respect of prior year relates to
operations in the USA. The combined state, federal and branch rate of
corporate tax in USA is approximately 29%.
The Company and Group do not have any exposure to Pillar Two income taxes.
8. Earnings per share
Earnings per ordinary share have been calculated using the weighted average
number of shares in issue during the relevant financial year. The weighted
average number of shares in issue during the year was 2,015,964,616
(2023*:2015,964,616).
Fully diluted earnings are based on 2,015,964,616 (2023*:2,015,964,616) shares
and the profit for the financial period was $1.305m (2023: loss $9.155m).
*The 2023 share figure has been restated to reflect the correct weighted
average number of shares for the year ended 31 December 2023.
Instruments (including contingently issuable shares) that could potentially
dilute basic earnings per share in the future but were not included in the
calculation of diluted earnings per share because they are antidilutive for
the periods presented.
9. Intangible Assets
Group Exploration and evaluation assets Other Total
intangible
assets
Cost $'000 $'000 $'000
At 1 January 2023 6,105 26,316 32,421
Additions for the year 486 - 486
Grant reimbursement (112) - (112)
Foreign exchange difference 219 1 220
Research and development incentive (8) - (8)
________ ________ ________
At 31 December 2023 6,690 26,317 33,007
________ ________ ________
At 1 January 2024 6,690 26,317 33,007
Additions in the year 444 - 444
Research and Development refund (26) - (26)
Reclassification to Disposal Group - (545) (545)
Foreign exchange difference (85) - (85)
________ ________ ________
At 31 December 2024 7,023 25,772 32,795
________ ________ ________
Amortisation and impairment
At 1 January 2023 (1,122) (25,772) (26,894)
Impairment of intangible asset - (545) (545)
________ ________ ________
At 31 December 2023 (1,122) (26,317) (27,439)
________ ________ ________
At 1 January 2024 (1,122) (26,317) (27,439)
Reclassification to Disposal Group - 545 545
________ ________ ________
At 31 December 2024 (1,122) (25,772) (26,894)
________ ________ ________
Net book value
At 31 December 2022 4,983 544 5,527
________ ________ ________
At 31 December 2023 5,568 - 5,568
________ ________ ________
At 31 December 2024 5,901 - 5,901
________ ________ ________
Exploration and evaluation assets
(i) Exploration and evaluation ("E&E") costs as at 31 December 2024
are the costs associated with the exploration tenements in the UK held by
Cornwall Resources Ltd ('CRL').
Other intangible assets
(ii) The other intangible asset of $25,772k arose from a contractual
relationship entered into by Southern Minerals Group LLC ('SMG'), an entity
wholly owned by Ebony Iron Pty Limited, with a third party for the rights to a
magnetite stockpile held at that party's Cobre mine in New Mexico, USA. This
other intangible asset was fully amortised by the end of 31 December 2017.
(iii) An intangible asset of $545k arose from the contractual relationship
entered into by LCCM with a third party for an offtake agreement over the
Leigh Creek Copper mine project. Further information regarding the impairment
of the LCCM project can be found at note 11.
The other intangible assets have been assessed for impairment at 31 December
2024.
The carrying value of the intangible asset is assessed as nil at 31 December
2024 and an impairment expense of $nil (2023: $0.545m) has been charged to the
Statement of Comprehensive Income.
At 31 December 2024, the intangible asset has been reclassified as an Asset
Held for Sale, refer Note 22.
10. Investments
Company Loans to subsidiary undertakings Shares in subsidiary undertakings Total
(ii) (i)
Cost $'000 $'000 $'000
At 1 January 2023 7,158 50,845 58,003
Movement in the year (89) - (89)
Foreign exchange difference 380 368 748
________ ________ ________
At 31 December 2023 7,449 51,213 58,662
_________ _________ _________
At 1 January 2024 7,449 51,213 58,662
Movement in the year 549 - 549
Foreign exchange difference (128) 265 137
________ ________ ________
At 31 December 2024 7,870 51,478 59,348
_________ _________ _________
Impairment
At 1 January 2023 (2,524) (46,703) (49,227)
Charge for the year (3,646) - (3,646)
Foreign exchange difference (213) (99) (312)
________ ________ ________
At 31 December 2023 (6,383) (46,802) (53,185)
_________ _________ _________
At 1 January 2024 (6,383) (46,802) (53,185)
Charge for the year (128) - (128)
Foreign exchange difference 72 (153) (81)
________ ________ ________
At 31 December 2024 (6,439) (46,955) (53,394)
_________ _________ _________
Carrying Value
At 31 December 2023 1,066 4,411 5,477
_________ _________ _________
At 31 December 2024 1,431 4,523 5,954
_________ _________ _________
(i) Shares in subsidiary undertakings are assessed for impairment and are
carried at cost. Refer Note 1 for further information in respect to the
accounting policy.
(ii) Loans provided to subsidiary undertakings are interest free and
repayable on demand. The loans are expected to be repaid by future disposal
proceeds and revenues generated from the Group's assets in USA and the UK
respectively.
Loans to subsidiary undertakings are assessed for impairment in accordance
with IFRS 9. Under IFRS 9, provisions for impairment of loans in subsidiary
undertakings is based on an expected credit loss assessment (refer note 1 for
further detail).
IFRS 9 requires the parent company to make assumptions when implementing the
forward- looking expected credit loss model. This model is required to be used
to assess the intercompany loan receivables from its subsidiaries for
impairment. The model also assesses the investment in subsidiaries for
impairment.
Arriving at an expected credit loss allowance involved considering different
scenarios for the recovery of the intercompany loan receivables, the possible
credit losses that could arise and probabilities for these scenarios and an
assessment of the net asset position of the subsidiary.
The following were considered, the exploration project risk, the future sales
potential of product, value of potential reserves and the resulting expected
economic outcomes of the project.
Refer Note 1 for further information in respect to the accounting policy and
Note 2 (c) in relation to the accounting judgements.
Investment in subsidiaries
2024 2023
Company- carrying value $'000 $'000
Investments in subsidiary undertakings - CRL 4,523 4,411
________ ________
4,523 4,411
________ ________
The Company holds more than 20% of the share capital of the following
companies:
Subsidiary undertakings Country of Principal Class of %
Incorporation Activity share Owned
Central Australian Rare Earths Pty Ltd Australia (ii) Exploration and development Ordinary 100%
Iron Glen Holdings Pty Limited Australia (ii) Holding Company Ordinary 100%
Southern Minerals Group LLC (i) USA (iii) Sale of magnetite Ordinary 100%
SMG Cobre LLC (i) USA (iii) Holding Company Ordinary 100%
Ebony Iron Pty Limited Australia (ii) Holding Company Ordinary 100%
Leigh Creek Copper Mine Pty Ltd (i) Australia (ii) Exploration and development Ordinary 100%
Iron Glen Pty Ltd Australia (ii) Dormant Company Ordinary 100%
Cornwall Resources Limited United Kingdom (iv) Exploration and development Ordinary 100%
(i) Held by Ebony Iron Pty Limited
(ii) Registered office - 3 Laundess Avenue, Panania NSW 2213
(iii) Registered office - 303 Fierro Road, Hanover, New Mexico, USA, 88041
(iv) Registered office - 27-28 Eastcastle St, London W1W 8DH United
Kingdom
Cornwall Resources Ltd is exempt from audit by virtue of section
477 of the Companies Act 2006.
11. Property, Plant, and Equipment
Development Asset Plant and Machinery Total
Group $'000 $'000 $'000
Cost
At 1 January 2023 7,807 723 8,530
Additions in the year 202 - 202
Foreign exchange difference 24 - 24
________ ________ _______
8,033 723 8,756
________ ________ _______
At 31 December 2023 8,033 723 8,756
Additions - Reclassify to Disposal Asset 113 - 113
Reclassify to Disposal Asset (8,146) (328) (8,474)
Foreign exchange difference - 7 7
________ ________ _______
At 31 December 2024 - 402 402
________ ________ ________
Depreciation and impairment
At 1 January 2023 - (307) (307)
Charge in the year -impairment (8,033) (328) (8,361)
Charge in the year - depreciation - (16) (16)
Foreign exchange difference - 8 8
________ ________ ________
At 31 December 2023 (8,033) (643) (8,676)
Charge in the year - impairment (113) - (113)
Charge for the year - depreciation - (18) (18)
Reclassify to Disposal Asset - Impairment 8,146 328 8,474
Foreign exchange difference - (9) (9)
________ ________ ________
At 31 December 2024 - (342) (342)
________ ________ ________
Carrying value
At 31 December 2022 7,807 416 8,223
________ ________ ________
At 31 December 2023 - 80 80
________ ________ ________
At 31 December 2024 - 60 60
________ ________ ________
Management assesses the carrying value of Development assets for indicators of
impairment based on the requirements of IAS36. The following are the key
assumptions used in this assessment of carrying value.
· Mineable reserves over life of project
· Forecasted Copper pricing
· Capital and operating cost assumptions to deliver the mining
schedule
· Foreign exchange rates
· Discount rate
If the carrying amount of the Development asset exceeds the recoverable
amount, the asset is impaired. The Group will impair the carrying amount of
the asset to its recoverable amount and recognise an impairment loss.
2024 Assessment
There are significant indicators of impairment for the LCCM project. Additions
to the asset in 2024 represent ongoing costs associated with maintaining the
asset.
The LCCM project has been, and continues to be, extensively marketed to
potential investors/purchasers. This has included a full review by major
Australian mining groups and international funders who have passed on the
project. Despite the Directors' efforts to secure funding, a transaction was
not achieved in the year ended 31 December 2024. Accordingly, the Directors
have assessed that indicators for impairment exist.
The Group has impaired the carrying amount of the asset to nil and recognised
a loss from discontinued operations at 31 December 2024 of $113,000, refer
Note 26.
At 31 December 2024, the asset has been reclassified as an Asset Held for
Sale, refer Note 22.
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
- The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days from 23 April (or such further period
as may be agreed by the parties), for an exclusive call option to acquire 100%
of LCCM (the "Call Option"). On 23 May 2025, the period was extended by 14
days.
- Under the Call Option, which will be exercisable for a period of six
months (or such longer period as may be agreed by the parties), the purchaser
may elect to acquire 100% of LCCM for an initial payment to Strategic
Minerals of A$1.9 million in cash.
- The purchaser anticipates completing a listing on the Australian
Securities Exchange upon which it will issue shares to Strategic
Minerals equivalent to 19.9% of the listed vehicle up to a maximum value
limit of A$3 million.
- The purchaser will pay an earn-out to Strategic Minerals equivalent
to A$4 million ("Earn-Out Consideration") to be paid on a half yearly basis
from the commencement of commercial production at the Project with each half
yearly payment to be the equivalent of 20% of net free cash flows from the
prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
12. Inventories
2024 2023
$'000 $'000
Finished goods held for sale 4 4
________ ________
4 4
________ ________
No inventories have been written off to profit or loss in the year (2023:
Nil).
13. Trade and other receivables
2024 2023
Group $'000 $'000
Current
Trade receivables 277 198
Less: provision for impairment of trade receivables - -
________ ________
277 198
Other receivables - 7
VAT/GST Receivable 18 14
________ ________
295 219
________ ________
Prepayments 36 -
________ ________
Non-Current
Rehabilitation bond - 136
________ ________
- 136
________ ________
Company
Current
VAT/GST Receivable 10 7
________ ________
10 7
________ ________
The Group's trade receivables are derived from magnetite customers at Cobre,
whose credit quality is assessed by considering the customers financial
position, experience, and other factors. There are no significant
concentrations of credit risk, whether through exposure to individual
customers, specific industry sectors and/or regions. Within 90 days of the
year end, the Group had collected 100% of the trade receivables outstanding at
31 December 2024. The Group did not recognise any impairment and believes that
credit risk is limited as customers pay within a short period of time.
The Group applies the IFRS 9 simplified approach to measuring credit losses
using a lifetime expected credit loss provision for trade receivables. Based
on the assessment, the carrying value of trade receivables, classified at
amortised cost, approximated the fair value.
14. Cash and cash equivalents
2024 2023
Group $'000 $'000
Bank current accounts 621 112
________ ________
Cash in the statement of cash flows 621 112
________ ________
Company
Bank current accounts 14 7
________ ________
Cash in the statement of cash flows 14 7
________ ________
The Group's balances are held with well-known and highly rated UK, USA, and
Australian banks.
15. Trade and other payables
As restated
2024 2023
Group $'000 $'000
Trade payables 125 830
Other payables 25 2
Accruals 92 1,332
________ ________
242 2,164
________ ________
Company
Trade payables 7 213
Other payables 11 -
Accruals 92 124
________ ________
110 337
________ ________
Loans due to subsidiary undertakings 3,677 2,230
________ ________
3,677 2,230
________ ________
Book values approximate to fair value at 31 December 2024 and 2023.
Intercompany loan balances are interest-free, and repayable on demand.
16. Provisions
Provision for Environmental Liability Total
Deferred
Tax Liability
Group -As restated $'000 $'000 $'000
At 1 January 2023 150 1,191 1,341
Movement for the year (34) - (34)
Foreign exchange movement in year - 1 1
Restated to accruals (Note 28) - (1,192) (1,192)
________ ________ ________
At 31 December 2023 116 - 116
________ ________ ________
Movement for the year 154 - 154
________ ________ ________
At 31 December 2024 270 - 270
________ ________ ________
17. Deferred tax
A deferred tax liability has been recognised in relation to the temporary
differences arising from accelerated depreciation for tax purposes compared to
the depreciation charged in the financial statements.
Under the applicable tax legislation, certain fixed assets are depreciated at
a faster rate for tax purposes than for accounting purposes. This has resulted
in a taxable temporary difference and the recognition of a corresponding
deferred tax liability.
The deferred tax liability has been restated at 1 January 2023 and 31 December
2023 to reflect the previously unrecognised timing differences as detailed in
Note 29.
18. Leases
The Group has leases for an office, plant and machinery (including two dozers
and an excavator) and a vehicle. Each lease is reflected on the balance sheet
as a right-of-use asset and a lease liability. The Group classifies its
right-of-use assets in a consistent manner to its property, plant, and
equipment (see Note 11).
Right of Use Asset
Office lease Plant, machinery, and vehicles Total
$'000 $'000 $'000
Group
At 1 January 2023 1 583 584
Additions - 150 150
Amortisation (capitalised) (1) (3) (4)
Amortisation - (277) (277)
________ ________ ________
At 31 December 2023 - 453 453
________ ________ ________
Group
At 1 January 2024 - 453 453
Additions - 940 940
Amortisation (capitalised) - (6) (6)
Amortisation - (334) (334)
________ ________ ________
At 31 December 2024 - 1,053 1,053
________ ________ ________
Lease Liabilities
Office lease Plant, machinery, and vehicles Total
$,000 $'000 $'000
Group
As at 1 January 2023 4 583 587
Additions - 150 150
Interest payments - 14 14
Lease payments (4) (292) (296)
________ ________ ________
At 31 December 2023 - 455 455
________ ________ ________
As at 1 January 2024 - 455 455
Additions - 975 975
Interest expense - 19 19
Lease payments - (343) (343)
________ ________ ________
At 31 December 2024 - 1,106 1,106
________ ________ ________
Lease liabilities are presented in the Statement of Financial Position as
follows:
2024 2023
$,000 $'000
Group
Current 369 153
Non-Current 737 302
________ ________
Total 1,106 455
________ ________
Maturity Analysis of lease liabilities
Between Between Between
Group Up to 3 3 and 12 1 and 2 2 and 5 Over
Months Months Year Years 5 years
At 31 December 2024 $'000 $'000 $'000 $'000 $'000
Lease liabilities 134 235 209 528 -
_______ _______ _______ _______ _______
Total 134 235 209 528 -
_______ _______ _______ _______ _______
The Company does not have any lease liabilities.
The table below describes the nature of the Group's leasing activities by type
of right-of-use asset.
Right of Use Asset No of Right of Use assets leased Range of remaining term No of leases with extension options
Plant and Machinery 6 1-5 years -
Motor Vehicle 1 1-5 years -
19. Share Capital and Premium
Number Share Share Premium Total
Capital
$,000 $,000 $'000
At 1 January 2024 Ordinary shares of 0.1 pence each 2,015,964,616 2,916 49,387 52,303
____________ _______ _______ _______
At 31 December 2024 Ordinary shares of 0.1 pence each 2,015,964,616 2,916 49,387 52,303
____________ _______ _______ _______
The Parent Company has one class of Ordinary Share and all shares have equal
voting rights and rank pari passu for the distribution of dividends and
repayment of capital.
The total issued share capital of the Company comprises 2,015,964,616 ordinary
shares of 0.10p each, with one voting right per share. The Company does not
hold any ordinary shares in treasury.
The total number of ordinary shares and voting rights in the Company is
therefore 2,015,964,616.
During 2023, the Company issued 10,000,000 warrants. Each warrant attached
which entitled the holder to subscribe for one new Ordinary Share at a price
of 0.50p per share with an expiry date of 31 December 2025.
During 2024, the Company issued 10,000,000 warrants. Each warrant attached
which entitled the holder to subscribe for one new Ordinary Share at a price
of 0.50p per share with an expiry date of 31 December 2025.
Date of grant Granted at 31.12.23 Issued Cancelled / Exercised Granted at 31.12.24 Exercise price Exercise Period
From To
10.10.23 10,000,000 - - 10,000,000 0.50p 10.10.23 31.12.25
01.04.24 - 10,000,000 - 10,000,000 0.50p 01.04.24 31.12.25
The number of warrants that are exercisable at 31 December 2024 is 20,000,000
(2023:10,000,000).
The estimated fair value of warrants issued is calculated by applying the
Black-Scholes option pricing model.
The assumptions used in for the 2023 warrant calculation were as follows:
Share price at date of grant 0.122p
Exercise Price 0.50p
Expected Volatility 116%
Expected Dividend Nil
Contractual Life 2.2 years
Risk free rate 5.25%
Estimated fair value of each option 0.04245p
The annual risk-free rate of interest is estimated to be 5.25%.
The expected volatility was determined based on the historic volatility of the
Company's shares.
The assumptions used in for the 2024 warrant calculation are as follows:
Share price at date of grant 0.226p
Exercise Price 0.50p
Expected Volatility 116%
Expected Dividend Nil
Contractual Life 1.2 years
Risk free rate 4.60%
Estimated fair value of each option 0.06494p
The annual risk-free rate of interest is estimated to be 4.60%.
The expected volatility was determined based on the historic volatility of the
Company's shares.
20. Share based payments
The Group has a share-ownership compensation scheme for senior executives of
the Group whereby senior executives may be granted options to purchase
ordinary shares in the Company.
No options were granted in 2024. (2023: nil).
21. Loans and Borrowings
Loan Total
$'000 $'000
Group
As at 1 January 2023 - -
Loan advance 34 34
Accrued interest 1 1
________ ________
As at 31 December 2023 35 35
Loan advance 62 62
Accrued interest 10 10
Foreign exchange (3) (3)
Loan repayment (104) (104)
________ ________
As at 31 December 2024 - -
________ ________
During 2024 the Company entered into the following loans with individual
investors. The loans were undertaken through the Company's 100% owned
subsidiary Ebony Iron Pty Ltd.
1. Three-month facility $A50,000, which matured in May 2024. Interest rate
on the facility was 48%. The loan was extended for one month and was fully
repaid in June 2024. The loan also included an interest kicker, whereby the
Company would have had to pay the Lender an additional fee relating to the
increase in the value of another share listed on the ASX, however this
additional clause was not triggered. No warrants were attached to this loan.
2. Six-month facility $A50,000, which matured in October 2024. Interest
rate on the facility was 12% and includes the grant of 10,000,000 warrants
over new ordinary shares of 0.1 pence each in the Company with an exercise
price of 0.5p maturing 31 December 2025. The loan was fully repaid in October
2024.
During 2023 the Company entered short-term financing facilities with an
individual investor. The facility comprised $A50,000 which matured in May
2024. The loan was subsequently extended to October 2024. The interest rate on
the financing was 12% pa and includes the grant of 10,000,000 warrants over
new ordinary shares of 0.1 pence each in the Company with an exercise price of
0.5p maturing 31 December 2025. The loan was fully repaid in October 2024.
22. Assets Held for Sale
2024
$'000
Group
Assets of Disposal Group Classified as held for Sale
Development Asset (Note 11) 8,146
Development Asset - Impairment (8,146)
Property Plant and Equipment (Note 11) 328
Property Plant and Equipment- Impairment (328)
Intangible Asset (Note 9(iii)) 545
Intangible Asset - Impairment (545)
Cash and cash equivalents 3
Other Current Assets 124
________
127
________
Liabilities of Disposal Group Classified as held for Sale
Trade payables 16
Environmental bond 1,082
________
1,098
________
Net Assets of Disposal Group Classified as held for Sale (971)
________
Throughout 2024, the Company has worked with several parties who have
expressed an interest in investing in or acquiring the LCCM project.
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
- The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days from 23 April (or such further period
as may be agreed by the parties), for an exclusive call option to acquire 100%
of LCCM (the "Call Option"). On 23 May 2025, the period was extended by 14
days.
- Under the Call Option, which will be exercisable for a period of six
months (or such longer period as may be agreed by the parties), the purchaser
may elect to acquire 100% of LCCM for an initial payment to Strategic
Minerals of A$1.9 million in cash.
- The purchaser anticipates completing a listing on the Australian
Securities Exchange upon which it will issue shares to Strategic
Minerals equivalent to 19.9% of the listed vehicle up to a maximum value
limit of A$3 million.
- The purchaser will pay an earn-out to Strategic Minerals equivalent
to A$4 million ("Earn-Out Consideration") to be paid on a half yearly basis
from the commencement of commercial production at the Project with each half
yearly payment to be the equivalent of 20% of net free cash flows from the
prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
23. Commitments
(a) Capital expenditure commitments.
At 31 December 2024, no capital commitments existed (2023: Nil).
(b) Exploration commitments
To maintain current rights to tenure of exploration tenements, the Group is
required to outlay amounts in respect of tenement rent to the relevant
governing authorities and to meet certain annual exploration expenditure
commitments. Other than for standard rent and licence fees, the Group has
flexibility over the life of the tenement to meet exploration expenditure
commitments. The expected timing of outlays (exploration expenditure, rent and
licence fees) which arise in relation to granted tenements and are as follows:
2024 2023
Group $'000 $'000
due within one year 142 318
due after one year and within five years 788 1,362
due after five years 708 2,158
________ ________
1,638 3,838
________ ________
If LCCM is sold or the mining leases and exploration tenements are
relinquished, there would be a decrease in the expenditure commitments as
follows:
Group $'000
due within one year -reduction 98
due after one year and within five years 622
due after five years 516
________
1,236
________
(c) Other commitments
As part of the terms of agreement in relation to the purchase of CRL, the
Company had a commitment of AUD $1m on net smelter sales arising from CRL
production reaching $AUD50m and a further $AUD1m on net smelter sales arising
from CRL production reaching $AUD100m.
Given the asset is still in the exploration phase, these milestone events
triggering deferred consideration payments are uncertain.
As part of the PEPR, the Company has an obligation to pay a AUD$1.140m bond
prior to commencement of authorised operations at the LCCM site. The bond
addresses future liabilities resulting from operations as described in the
PEPR.
Whilst a possible obligation exists in relation to the consideration payable,
given the project is not in operation, it was concluded that at reporting date
that the payment is uncertain.
When the payments become probable, the Group will recognise a liability in the
financial statements.
24. Controlling party
There is no ultimate controlling party of the Group.
25. Related party transactions
Director and key management personnel remuneration has been disclosed in Note
6.
Directors' interest in shares and options have been disclosed in the Directors
Remuneration Report.
J Harrison was a director of the Company and was consultant to CRL during
2023. Fees paid by CRL for services provided by J Harrison's associated
entity, during 2024 were nil (2023: $17,040).
The Group paid nil (2023: $24,980) of J Harrison's directors' remuneration to
an associated entity. No amount was outstanding at year end (2023: nil).
The Group incurred costs of $72,567 (2023: $175,402) in relation to J Peters'
directors remuneration to an associated entity. Of this amount $14,513 (2023:
$102,318) was incurred by the Company and $58,054 (2023: $73,084) was incurred
by Iron Glen Holdings Pty Ltd.
J Peters Executive directors fees were temporarily reduced in 2024 reflecting
undertakings associated with 2023.
After adjusting in 2024 for an agreed allocation associated with the 2023
undertakings, the amount paid to related parties of J Peters in 2024 was
$43,540 (2023: $175,402).
The amount outstanding at the year-end payable to the associated entities was
nil (2023: $205,609).
On 1 December 2024, the Company entered a six-month consultancy for $10,998
per month with an associated entity of J Peters.
The Group incurred costs of $30,057 (2023: $53,982) in relation to A Broome's
directors remuneration to an associated entity.
The amount outstanding at 31 December 2024 payable to the associated entity
was $35,639 (2023: $70,426).
The Group incurred costs of $94,278 (2023: $56,993) in relation to K Williams
consulting fees to an associated entity.
The amount outstanding at 31 December 2024 payable to the associated entity
was nil (2023: $39,286).
During 2024 interest at 8% pa was paid on accrued director remuneration. Total
interest paid to related parties in 2024 was $20,136. (2023: nil).
There were no other transactions with Directors, key management personnel or
other related parties.
26. Discontinued operations
The single line-item discontinued operations in 2024 represents the loss of
Leigh Creek Copper Mine Pty Ltd that is being actively marketed for sale.
2024 2023
$'000 $'000
Impairment loss (113) -
________ ________
Loss for the year from discontinued operations (113) -
________ ________
The cash outflows of $113,000 from discontinued operations relating to Leigh
Creek Copper Mine Pty Ltd in the consolidated statement of cash flows (2023:
nil) represent additions to the Development Asset.
27. Events after the end of the reporting period
Grant Funding
In April 2025, CRL finalised grant funding of over £764k with the UK
Government through the UK Shared Prosperity Fund ("SPF"). Cornwall
Council is responsible for managing projects funded by the UK Shared
Prosperity Fund through the Cornwall and the Isles of Scilly Good Growth
Programme.
The grant funding, which will be equally matched by Company expenditure up to
a total Project spend of £1,528k, will enable new exploration activities,
including borehole drilling, aimed at accelerating the development of the
Company's Redmoor Tungsten-Tin-Copper Project ("Redmoor") in Cornwall.
£1m Placement
In April 2025, the company undertook a Placing which raised gross proceeds
of £1m through the placing of 333,333,333 new Ordinary Shares to certain
investors at a price of 0.3 pence per share. The Placing Price represented
a discount of 25% to the Closing Price of 0.4 pence per Ordinary Share
on 15 April 2025, being the latest practicable business day prior to the
publication of the Announcement.
The net proceeds of the Placing will be principally used to progress
activities at the Company's Redmoor Tungsten-Tin-Copper
Project in Cornwall and for working capital purposes.
Non-Binding Heads of Agreement
In April 2025, the Company signed a non-binding heads of agreement, based on
the following conditions:
- The purchaser will make a non-refundable payment to Strategic
Minerals of A$100,000 within 30 days from 23 April (or such further period
as may be agreed by the parties), for an exclusive call option to acquire 100%
of LCCM (the "Call Option"). On 23 May 2025, the period was extended by 14
days.
- Under the Call Option, which will be exercisable for a period of six
months (or such longer period as may be agreed by the parties), the purchaser
may elect to acquire 100% of LCCM for an initial payment to Strategic
Minerals of A$1.9 million in cash.
- The purchaser anticipates completing a listing on the Australian
Securities Exchange upon which it will issue shares to Strategic
Minerals equivalent to 19.9% of the listed vehicle up to a maximum value
limit of A$3 million.
- The purchaser will pay an earn-out to Strategic Minerals equivalent
to A$4 million ("Earn-Out Consideration") to be paid on a half yearly basis
from the commencement of commercial production at the Project with each half
yearly payment to be the equivalent of 20% of net free cash flows from the
prior period.
A$60,000 of the call option was paid at 16 June 2025 with the balance of
$40,000 expected by 18 June 2025.
28. Prior year reclassification
The Group has restated its Consolidated Statement of Financial Position at 1
January 2023 and 31 December 2023 to reclassify the LCCM Environmental Bond
from provisions to accruals within trade and other payables. The restatement
was made to correctly reflect the nature of this liability. The
reclassification had no impact on the Consolidated Statement of Comprehensive
Income for the year ended 31 December 2023, and net assets are unchanged in
the Consolidated Statement of Financial Position at 31 December 2023.
The effect of the restatement at 1 January 2023 and 31 December 2023 is to
decrease provisions and increase trade and other payables by $1,191,000 and
$1,082,000 respectively.
There is no impact on the net assets or equity as a result of this change.
29. Prior year adjustments
The Group has recognised a deferred tax liability of $150,000 and $116,000 in
the Consolidated Statement of Financial Position at 1 January 2023 and 31
December 2023 respectively. This liability has been recognised in relation to
the temporary differences arising from accelerated depreciation for tax
purposes compared to the depreciation charged in the financial statements.
The effect of the recognition and movement in the deferred tax liability on
the Consolidated Statement of Comprehensive Income for the year ended 31
December 2023 is as follows:
Year ended 31 December 2023 Previously reported Deferred tax adjustment Restated
$'000 $'000 $'000
Taxation (107) 34 (73)
Loss for the year from operations (9,189) 34 (9,155)
Loss for the period attributable to the owners of the parent (9,189) 34 (9,155)
Total comprehensive income/ (loss) attributable to the owners of the parent (9,000) - (8,906)
Earnings per share (cents) (0.45) - (0.45)
The effect of movement in the deferred tax liability and the restatement of
the Environmental Bond on the Consolidated Statement of Financial Position for
the year ended 31 December 2023 is as follows:
Year ended 31 December 2023 Previously reported Deferred tax adjustment Environmental bond restatement Restated
$'000 $'000 $'000 $'000
Retained Earnings (45,592) (116) - (45,708)
Total Equity 3,848 (116) - 3,732
Trade and other payables 972 - 1,192 2,164
Current Liabilities 1,261 - 1,192 2,453
Provisions 1,192 116 (1,192) 116
Non- current liabilities 1,494 116 (1,192) 418
Total Liabilities 2,755 116 - 2,871
Competent Persons Statement
The information in this report that relates to Redmoor Project is based on
information compiled and reviewed at the time by Paul Gribble C.Eng. a Fellow
of the Institute of Materials, Minerals and Mining (FIMMM), and who is
Principal Geologist of Geologica UK (Geologica). Paul Gribble has sufficient
experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2012 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves'. Paul Gribble is also a Competent Person as defined in the Note
for Mining and Oil & Gas Companies which form part of the AIM Rules for
Companies.
The information in this report that relates to the LCCM project is based on
information compiled by Mr. David Larsen, who is a Member of the Australian
Institute of Geoscientists (Member No. 1976). Mr. Larsen is the Principal
Geologist at Terra Consulting Pty Ltd and is a consultant to the Company. He
has sufficient experience relevant to the style of mineralisation and type of
deposit under consideration and to the activity he is undertaking to qualify
as a Competent Person, as defined in the 2012 Edition of the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC
2012) and a qualified person as defined in the AIM Note for Mining and Oil
& Gas Companies which forms part of the AIM Rules for Companies. Mr.
Larsen has over 30 years' Australia and international experience in
exploration, mining geology and resource estimation for gold, base metals and
iron ore deposits.
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. END FR UNORRVKUNAURRecent news on Strategic Minerals
See all newsREG - Strategic Minerals - Final Results
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AnnouncementREG - Strategic Minerals - Upgrade of Historical Tungsten Results at Redmoor
Announcement