RNS Number : 2940B
Strategic Minerals PLC
30 September 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.
30 September 2025
Strategic Minerals plc
("Strategic Minerals", the "Group" or the "Company")
Half-Year Report 2025
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), an international mineral exploration and production company, is pleased to announce its unaudited interim results for the half year ended 30 June 2025 ("H1 2025" or the "Period").
Financial Highlights
· Revenues: US$2,001,000 (H1 2024: US$2,136,000)
o 10-day shutdown of Cobre operations due to New Mexico wildfires caused a slight reduction in revenues, which are expected to be more than offset in H2 2025
· Pre-tax profit: US$568,000 (H1 2024: US$950,000)
· Post-tax profit: US$151,000 (H1 2024: US$667,000)
o Profit impacted by one-off costs associated with Board restructuring, settling in full overdue US tax liabilities from the prior year, and increased investment in exploration activities as the Company entered a new operational phase at the Redmoor Project
· Investments in development projects: US$480,000
o Redmoor Project: US$378,000
o Leigh Creek Copper Mine US$38,000
o Southern Minerals Group US$64,000
· Unrestricted cash at 30 June 2025: US$1,532,000 (31 Dec 2024: US$621,000)
· Oversubscribed £1.0 million placing in April 2025 to advance the Redmoor Project
Operational Highlights (By Subsidiary)
Cornwall Resources
Redmoor Tungsten-Tin-Copper Project, Cornwall, UK
· Significant upscaling of headcount and facilities as drilling commenced for the first time since 2018
· Awarded c.£764,000 UK Government grant funding - together with funds from the Company's April 2025 placing, this fully funds the ongoing exploration programme to accelerate Redmoor towards pre-feasibility
· Re-analysis of historical samples confirmed previous underreporting of certain samples and higher tungsten grades - already Europe's highest grade undeveloped tungsten deposit
· Drilling and sampling of nine boreholes progressing on schedule
o Completion of first three boreholes announced post Period-end with all intersecting the full thickness of the sheeted vein system with assay results currently pending
Southern Minerals Group
Cobre Magnetite Stockpile, New Mexico, USA
· Continued strong operational performance in H1 2025 despite 10-day shutdown due to wildfires
o Sales volumes: 28,467 tons (H1 2024: 31,327 tons)
· Strong Q3 sales expected to more than offset lost sales during the 10-day shutdown
Leigh Creek Copper Mine
Leigh Creek Copper Project, South Australia
· Granted a six-month call option in April 2025 for A$100,000 to a potential purchaser of Leigh Creek Copper Mine
o If exercised, the transaction would deliver up to A$5.9 million in cash payments and shares equivalent to 19.9% in the acquiring company
Board Changes
· Philip Haydn-Slater was appointed as independent Non-Executive Director in January 2025
· Peter Wale stepped down as Executive Director in March 2025
Charles Manners, Executive Chair, commented:
"Strategic Minerals entered a new phase in H1 2025. The turnaround of the Cobre magnetite operation in New Mexico last year provided a springboard for the Company to accelerate development of the Redmoor Tungsten-Tin-Copper Project in Cornwall. We have in Redmoor the opportunity to develop a leading source of critical and strategic minerals to provide resilience to western world supply chains. Now that the Cobre magnetite operation is performing strongly, we are focused on accelerating the development of Redmoor to unlock its true value."
Notes to Editors
About Strategic Minerals Plc
Strategic Minerals plc (AIM: SML; USOTC: SMCDY) is an AIM-quoted, producing minerals company, actively developing strategic projects in the UK, United States and Australia.
In 2019, the Company completed the 100% acquisition of Cornwall Resources Limited and the Redmoor Tungsten-Tin-Copper Project.
The Redmoor Project is situated within the historically significant Tamar Valley Mining District in Cornwall, United Kingdom, with a JORC (2012) Compliant Inferred Mineral Resource Estimate published 14 February 2019:
Cut-off (SnEq%)
Tonnage (Mt)
WO3 %
Sn %
Cu %
Sn Eq1 %
WO3 Eq %
>0.45 <0.65
1.50
0.18
0.21
0.30
0.58
0.41
>0.65
10.20
0.62
0.16
0.53
1.26
0.88
Total Inferred Resource
11.70
0.56
0.16
0.50
1.17
0.82
1 Equivalent metal calculation notes; Sn(Eq)% = Sn% x 1 + WO3% x 1.43 + Cu% x 0.40. WO3(EQ)% = Sn% x 0.7 + WO3 + Cu% x 0.28. Commodity price assumptions: WO3 US$ 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
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 acquired the Leigh Creek Copper Mine situated in the copper rich belt of South Australia. The Company has entered into an exclusive Call Option with South Pacific Mineral Investments Pty Ltd trading as Cuprum Metals to acquire 100% of the project.
CHAIRMAN'S STATEMENT
Introduction
Strategic Minerals entered a new phase in H1 2025. The turnaround of the Cobre magnetite operation in New Mexico last year, and associated 200% revenue increase, provided a springboard for the Company to accelerate development of the Redmoor Tungsten-Tin-Copper Project in Cornwall ("Redmoor"). With match grant funding and strong investor demand to support the opportunity, Strategic Minerals was able to commission a £1.5 million, 12-month exploration programme including the first borehole drilling since 2018. This programme is in full swing.
Financial Results
The Cobre magnetite operation in New Mexico is the sole revenue generating engine of the Group. It sustains Strategic Minerals and its main operating subsidiary, Cornwall Resources. The strong recovery in magnetite sales which drove the 200% revenue increase in FY 2024 held firm in H1 2025. A 10-day shutdown due to wildfires caused a slight reduction in sales of 6% in the Period to US$2,001,000 (H1 2024: US$2,136,000) which would otherwise have been consistent with the first half of 2024. We are confident of more than offsetting that lost revenue in the second half of this year, with Q3 2025 sales already looking very healthy.
Moving into an intense operating phase at Redmoor, upscaling headcount and facilities, naturally resulted in an increase in costs which impacted profitability in the Period. Furthermore, a number of one-off costs were incurred in the Period in connection with the restructuring of the Company's Board and the settlement in full of historical taxation due to the IRS in the USA. Pre-tax profit for H1 2025 was therefore US$568,000 (H1 2024: US$950,000) and post-tax profit was US$151,000 (H1 2024: US$667,000). This is a new regime, with a transformed Cobre operation and an accelerated development programme at Redmoor in motion. While the Company is appropriately deploying more investment into Redmoor, we remain committed to keeping Board costs lean.
Bolstered by an oversubscribed placing to raise gross proceeds of c.£1.0 million which completed in May 2025, the Company ended the Period with US$1,532,000 of cash as at 30 June 2025 (31 Dec 2024: US$621,000). The strong investor demand reflects growing recognition of Redmoor's potential.
Cornwall Resources Limited ("CRL")
Redmoor Tungsten-Tin-Copper Project, Cornwall, UK ("Redmoor")
In April 2025, the Company announced that CRL was awarded c.£764,000 in match funding from the UK Shared Prosperity Fund under the Cornwall & Isles of Scilly Good Growth Programme. Together with the Company's oversubscribed placing, this has provided the c.£1.5m budget for a 12-month exploration project titled: "Exploration Drilling and Associated Activities to Enable Accelerated Development of the Redmoor Critical Minerals Project". Within the 12-month Project timeframe which began in April 2025, the Company aims to:
· Undertake c.5,000m of new diamond core drilling and other associated activities
· Complete the ongoing relogging programme of historical CRL core
· Combine the results of new drilling and relogging with the aim to produce a new, upgraded and enlarged Mineral Resource Estimate ("MRE")
· Update the economic model, using the updated MRE and incorporating the significantly increased commodity prices since the 2020 Redmoor Scoping Study was produced
· Formulate an investment-ready business case and delivery plan, before the end of March 2026, for moving Redmoor into prefeasibility
By May 2025, drilling pre-commencement and enabling activities were well advanced, with drilling starting just before the end of the Period in late June 2025 - the first since 2018.
Nine new boreholes were planned for a total of approximately 5,300 metres of diamond core drilling over six months. Post-Period end, in September 2025, the first three boreholes were completed at Pad 1, intersecting the full thickness of the Redmoor sheeted vein system and confirming visible wolframite and chalcopyrite consistent with historic mineralisation. A second drill rig was mobilised to site, accelerating the programme with multiple boreholes planned from Pads 2 and 3. Analytical results from these boreholes, together with ongoing relogging and sampling work, will feed into the planned MRE update expected in Q1 2026.
In parallel with the drilling, the historical core relogging and sampling programme is ongoing, with additional drillcore and soil samples being analysed to strengthen the geological dataset. Results from re-analysis of historical tungsten samples confirmed an average 9.2% increase in tungsten grades, validating upside potential within the existing 2019 MRE, reported in accordance with the JORC Code (2012 Edition). Additional re-analysis of historical drillcore identified significant silver mineralisation associated with copper within the sheeted vein system, further enhancing Redmoor's economic and strategic value.
In support of the accelerated development programme at Redmoor, Strategic Minerals is investing in upgrading CRL's facilities and expanding its technical team. Since the initiation of the match grant funded activities, the team at Redmoor has increased to nine full time, permanent staff, with seven geologists, ensuring the smooth delivery of the exploration drilling programme and other exploration activities. To further support the effective and high-quality delivery of the programme, site upgrades include a significant improvement in core logging facilities and equipment available to the geological team, as well as new long term storage facilities for the existing exploration drill core with capacity for future programmes.
Southern Minerals Group LLC ("SMG")
Cobre magnetite stockpile, New Mexico, USA
Cobre continued to deliver a strong operational performance in H1 2025 with sales volumes of 28,467 tons (H1 2024: 31,327tons). With the benefit new and returning customers last year, and an extension of access to the Cobre magnetite operation's stockpile through to 31 March 2029, this revenue-generating subsidiary of the Company is in very good health. Revenues in H1 2025 were only marginally below H1 2024 as a result of a 10-day shutdown due to wildfires and we expect SMG to make this back up in the second half of this year.
Leigh Creek Copper Mine Pty Ltd ("LCCM")
Leigh Creek Copper Project
In April 2025, Strategic Minerals signed a non-binding Heads of Agreement granting an exclusive call option for A$100,000 to Axis Mining & Minerals Pty Ltd (subsequently novated to South Pacific Mineral Investments Pty Ltd trading as Cuprum Metals ("Cuprum")) to acquire 100% of LCCM. Under the terms of the option, Cuprum may acquire LCCM for an initial cash payment of A$1.9 million and the issue of shares in Cuprum equivalent to 19.9% ownership up to a maximum value of A$3 million. Cuprum intends to list on the Australian Securities Exchange. Additionally, Cuprum will pay a cash earn-out of A$4.0 million from future production. In the event of the share issuance to Strategic Minerals being less than A$3 million as a result of the 19.9% limit, the Earn-Out Consideration shall be adjusted to a higher level to reflect the difference in value from the A$3 million maximum limit.
If the option is exercised, this deal structure will enable Strategic Minerals to divest a non-core asset, direct further non-dilutive funds toward the development of Redmoor, and retain the upside of a potential future copper development through a substantial shareholding in Cuprum.
Board Changes
In January 2025, Philip Haydn-Slater was appointed as an independent Non-Executive Director. Philip brings over 35 years of City experience, primarily in institutional sales and corporate broking. He co-founded HD Capital Partners and previously led Corporate Broking at WH Ireland in London, managing IPOs and secondary placings for resource-focused companies. Shortly after, in March 2025, Executive Director Peter Wale retired from the Board.
Post-Period end in August 2025, I transitioned from Non-Executive Chair to Executive Chair, reflecting my ongoing contributions to rationalising the Group and refocusing its strategy.
Safety
The Company maintains a strong safety culture across all operations. I am pleased to report that no significant safety incidents were recorded during the reporting period.
Outlook
Our overarching strategy is to grow the Company's value by unlocking the potential of the Redmoor Project, utilising sustainable cash flows from the Cobre operation to advance the project. We have in Redmoor the opportunity to develop a leading source of critical and strategic minerals to provide resilience to western world supply chains. Redmoor is already the highest-grade tungsten deposit in Europe and the second highest globally, with the potential to supply approximately 30% of Europe's tungsten needs before considering future upside from a potential upgrading of the MRE. The price of tungsten is soaring, reflecting ongoing shifts in the market, such as the closure of some previously subsidised Chinese operations and a growing emphasis on supply security for defence and high-technology applications. Having got the Cobre magnetite operation into sustainably good health last year, we are focused on accelerating the development of Redmoor to unlock its true value.
Charles Manners
Executive Chair
29 September 2025
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Continuing operations
Revenue
2,001
2,136
4,745
Raw materials and consumables used.
(278)
(393)
(846)
_________
_________
_________
Gross profit
1,723
1,743
3,899
Other income
36
-
-
Overhead expenses
(949)
(583)
(1,406)
Amortisation
(194)
(158)
(334)
Depreciation
(12)
(8)
(18)
Impairment
-
(25)
-
Share based payment
-
-
-
Foreign exchange gain/(loss)
(13)
(10)
(13)
_________
_________
_________
Profit from operations
591
959
2,128
Lease Interest
(23)
(9)
(19)
_________
_________
_________
Profit before taxation
568
950
2,109
Income tax (expense)/credit
(379)
(283)
(691)
_________
_________
_________
Profit from continuing operations
189
667
1,418
_________
_________
_________
Loss from discontinued operations
(38)
-
(113)
_________
_________
_________
Profit for the period attributable to:
Owners of the parent
151
667
1,305
_________
_________
_________
Other comprehensive income
Exchange gains/(losses) arising on translation of foreign operations
431
(205)
(71)
_________
_________
_________
_________
_________
_________
Total comprehensive (loss)/income attributable to:
Owners of the parent
582
462
1,234
_________
_________
_________
Profit/ (loss) per share attributable to the ordinary equity holders of the parent:
Basic and diluted - total operations
¢0.007
¢0.033
¢0.064
Basic and diluted - continuing operations
¢0.009
¢0.033
¢0.070
Basic and diluted - discontinued operations
(¢0.002)
-
(¢0.006)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Assets
Non-current assets
Intangible Asset
-
-
-
Deferred Exploration and evaluation costs
6,757
5,592
5,901
Other Receivables
-
133
-
Property, plant and equipment
107
72
60
Right of Use Assets
852
594
1,053
_________
_________
_________
7,716
6,391
7,014
_________
_________
_________
Current assets
Inventories
4
4
4
Trade and other receivables
308
519
295
Income Tax prepaid
-
-
31
Assets held for sale
134
-
127
Prepayments
46
-
36
Cash and cash equivalents
1,532
280
621
_________
_________
_________
2,024
803
1,083
_________
_________
_________
Total Assets
9,740
7,194
8,097
_________
_________
_________
Equity and liabilities
Share capital
3,362
2,916
2,916
Share premium reserve
50,172
49,387
49,387
Share options reserve
5
5
5
Merger reserve
21,300
21,300
21,300
Warrant Reserve
-
-
-
Foreign exchange reserve
(785)
(1,312)
(1,216)
Other reserves
(23,023)
(23,023)
(23,023)
Accumulated loss
(44,252)
(44,925)
(44,403)
_________
_________
_________
Total Equity
6,779
4,310
4,966
_________
_________
_________
Liabilities
Non-Current Liabilities
Lease Liabilities
630
375
737
Provisions
270
1,171
270
_________
_________
_________
900
1,546
1,007
_________
_________
_________
Current liabilities
Liabilities held for sale
1,156
1,098
Income Tax Payable
319
333
415
Trade and other payables
318
714
242
Loans and Borrowings
-
68
-
Lease Liabilities
268
223
369
_________
_________
_________
2,061
1.338
2,124
_________
_________
_________
Total Liabilities
2,961
2,884
3,131
_________
_________
_________
Total Equity and Liabilities
9,740
7,194
8,097
_________
_________
_________
CONSOLIDATED STATEMENT OF CASH FLOW
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Cash flows from operating activities
Profit/ (loss) after tax
151
667
1,305
Adjustments for:
Depreciation of property, plant, and equipment
12
8
18
Amortisation of Right of Use asset
194
158
334
Impairment charge
38
25
113
Income Tax expense
379
283
691
Lease Interest
23
9
19
(Increase) / decrease in inventory
-
-
-
(Increase) / decrease in trade and other receivables
(13)
(300)
(76)
(Increase) / decrease in prepayments
(10)
-
(36)
Increase / (decrease) in trade and other payables
76
(258)
(721)
Increase /(decrease) in prepaid income tax
-
-
-
Income tax paid
(475)
(20)
(223)
Share based payment expense
-
-
-
Foreign exchange movements
13
-
-
_________
_________
_________
Net cash flows from operating activities
388
572
1,424
_________
_________
_________
Investing activities
Increase in PPE Development Asset
(38)
(25)
(113)
Increase in PPE
(64)
-
-
Increase in deferred exploration and evaluation asset
(378)
(233)
(418)
_________
_________
_________
Net cash used in investing activities
(480)
(258)
(569)
_________
_________
_________
Financing activities
Net proceeds from issue of equity share capital
1,231
-
-
Proceeds from borrowings
-
67
62
Repayment of borrowings
-
(39)
(104)
Lease Payments
(231)
(174)
(343)
_________
_________
_________
Net cash from financing activities
1,000
(146)
(385)
_________
_________
_________
Net increase / (decrease) in cash and cash equivalents
908
168
508
Cash and cash equivalents at beginning of period
621
112
112
Exchange gains / (losses) on cash and cash equivalents
3
-
1
_________
_________
_________
Cash and cash equivalents at end of period
1,532
280
621
_________
_________
_________
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital
Share premium reserve
Merger Reserve
Warrant Warrant Reserve
Share options reserve
Initial Re-structure Reserve
Foreign Exch. reserve
Retained earnings
Total equity
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Balance at 1 January 2024
2,916
49,387
21,300
5
-
(23,023)
(1,145)
(45,708)
3,732
_______
_______
_______
_______
_______
_______
_______
_______
_______
Profit for the year
-
-
-
-
-
-
-
1,305
1,305
Foreign exchange translation
-
-
-
-
-
-
(71)
-
(71)
_______
_______
_______
Total comprehensive income/(loss) for the year
-
-
-
-
-
-
(71)
1,305
1,234
_______
_______
_______
_______
_______
_______
_______
_______
_______
Balance at 31 December 2024
2,916
49,387
21,300
5
-
(23,023)
(1,216)
(44,403)
4,966
Profit for the period
-
-
-
-
-
-
-
151
151
Foreign exchange translation
-
-
-
-
-
-
431
-
431
_______
_______
_______
Total comprehensive income for the year
-
-
-
-
-
-
431
151
582
Shares issued in the period
446
891
-
-
-
-
-
-
1,337
Share issue costs
-
(106)
-
-
-
-
-
-
(106)
_______
_______
_______
_______
_______
_______
_______
_______
_______
Balance at 30 June 2025
3,362
50,172
21,300
5
-
(23,023)
(785)
(44,252)
6,779
_______
_______
_______
_______
_______
_______
_______
_______
_______
All comprehensive income is attributable to the owners of the parent Company.
NOTES FORMING PART OF THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. General Information
Strategic Minerals Plc ("the Company") is a public company incorporated in England and Wales. The consolidated interim financial statements of the Company for the six months ended 30 June 2025 comprise the Company and its subsidiaries (together referred to as the "Group").
2. Significant accounting policies
Basis of preparation
In preparing these financial statements the presentational currency is US dollars. As the entire 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 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 International Financial Standards and UK adopted international accounting standards in conformity with the requirements of the Companies Act 2006.
The preparation of financial statements in compliance with adopted IFRS 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, not historical cost.
Going concern basis
The Directors have considered the Group and Parent Company's (together "the Group") 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 forecasts that to have sufficient funds to meet all operating costs until December 2026, the Group is reliant on cash being generated from the Cobre asset in line with forecast.
As outlined by the Board, it is intended that any funds required to progress either the Redmoor project or Cobre will be sourced either at the asset or Group level. Management are actively pursuing such funding.
The Directors have reasonable expectation that the Group will have access to sufficient resources by way of debt or equity markets should the need arise. Consequently, the consolidated financial statements have been prepared on a going concern basis.
The financial report does not include adjustments relating to the recoverability and classification of recorded asset amounts or to the amounts and classification of liabilities that might be necessary should the Group not continue as a going concern.
New standards, interpretations, and amendments effective 1 July 2025:
There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods and which have not been adopted early.
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.
· 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
· 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.
3. 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 to move the asset forward to development.
The Redmoor projects are 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 period to 30 June 2025.
(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.
(c) Carrying value of amounts owed by subsidiary undertakings.
IFRS9 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.
(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
vi) Estimated project commencement date.
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.
(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.
Judgements
(b) Investments in subsidiaries
Investment in subsidiaries comprises of the cost of acquiring the 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.
(c) Contingent consideration as part of Asset acquisition
Judgement was required in determining the accounting for the contingent consideration payable as per 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 reporting date it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation
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 - 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 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.
6 Months to 30 June 2025 (Unaudited)
SMG
Head Office
United Kingdom
Development Asset
Intra Segment Elimination
Total
$'000
$'000
$'000
$'000
$'000
$'000
Revenues
2,001
-
-
-
-
2,001
_______
_______
_______
_______
_______
_______
Gross profit
2,001
-
-
-
-
2,001
Raw materials/consumables
(278)
-
-
-
-
(278)
Overhead expenses
(440)
(409)
(100)
-
-
(949)
Management fee income/(expense)
-
-
-
-
-
Interest
-
-
-
-
-
-
Share based payments
-
-
-
-
-
-
Amortisation
(194)
-
-
-
-
(194)
Impairment
-
-
(38)
-
(38)
Depreciation
(12)
-
-
-
-
(12)
Foreign exchange gain/(loss)
-
(13)
-
-
-
(13)
Other income
-
-
36
36
_______
_______
_______
_______
_______
_______
Segment profit /(loss) from operations
1,077
(422)
(64)
(38)
-
553
_______
_______
_______
_______
_______
_______
Lease Interest
(23)
-
(23)
_______
_______
_______
_______
_______
_______
Segment profit /(loss) before taxation
1,054
(422)
(64)
(38)
-
530
_______
_______
_______
_______
_______
_______
6 Months to 30 June 2024 (Unaudited)
SMG
Head Office
United Kingdom
Development Asset
Intra Segment Elimination
Total
$'000
$'000
$'000
$'000
$'000
$'000
Revenues
2,136
-
-
-
-
2,136
_______
_______
_______
_______
_______
_______
Gross profit
2,136
-
-
-
-
2,136
Other Income
-
-
-
-
-
-
Raw materials/consumables
(393)
-
-
-
-
(393)
Overhead expenses
(342)
(214)
(5)
-
-
(561)
Management fee income/(expense)
(200)
200
-
-
-
Interest
-
(13)
(8)
-
-
(21)
Share based payments
-
-
-
-
-
-
Amortisation
(158)
-
-
-
-
(158)
Impairment
-
-
-
(25)
-
(25)
Depreciation
(8)
-
-
-
-
(8)
Foreign exchange gain/(loss)
-
227
-
-
(238)
(11)
_______
_______
_______
_______
_______
_______
Segment profit /(loss) from operations
1,035
200
-
(25)
(238)
959
_______
_______
_______
_______
_______
_______
Lease Interest
(9)
-
-
-
-
(9)
Finance Expense
-
-
-
-
-
-
_______
_______
_______
_______
_______
_______
Segment profit /(loss) before taxation
1,026
200
(13)
(25)
(238)
950
_______
_______
_______
_______
_______
_______
Year to 31 December 2024 (Audited)
SMG
Head Office
United Kingdom
Development Asset
Intra Segment Elimination
Total
$'000
$'000
$'000
$'000
$'000
$'000
Revenues
4,745
-
-
-
-
4,745
_______
_______
_______
_______
_______
_______
Total Revenue
4,745
-
-
-
-
4,745
Othe Revenue
-
-
-
-
-
-
Raw Materials/Consumables
(846)
-
-
-
-
(846)
Overhead expenses
(737)
(618)
(19)
-
-
(1,374)
Management fee income/(expense)
(100)
102
-
(2)
-
Share based payments
-
-
-
-
-
-
Impairment
-
-
-
-
-
-
Amortisation- right of use asset
(334)
-
-
-
-
(334)
Interest
-
(9)
-
-
-
(9)
Depreciation
(18)
-
-
-
-
(18)
(Loss)/ gain on intercompany loans
-
-
-
-
-
-
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
2,161
(1,469)
(31)
-
918
2,109
_______
_______
_______
_______
_______
_______
As at 30 June 2025 (Unaudited)
SMG
Head Office
United Kingdom
Development Asset
Total
$'000
$'000
$'000
$'000
$'000
Additions to non-current assets
64
-
378
-
442
_______
_______
_______
______
_______
Reportable segment assets
1,443
1,321
6,844
132
9,740
_______
_______
_______
______
_______
Reportable segment liabilities
1,533
142
130
1,156
2,961
_______
_______
_______
_______
_______
As at 30 June 2024 (Unaudited)
SMG
Head Office
United Kingdom
Development Asset
Total
$'000
$'000
$'000
$'000
$'000
Additions to non-current assets
-
-
233
25
258
_______
_______
_______
______
_______
Reportable segment assets
1,358
56
5,640
140
7,194
_______
_______
_______
______
_______
Reportable segment liabilities
1,065
495
116
1,208
2,884
_______
_______
_______
_______
_______
As at 31 December 2024 (Audited)
SMG
Head Office
United Kingdom
Development Asset
Total
$'000
$'000
$'000
$'000
$'000
Additions to non-current assets
-
-
418
113
531
_______
_______
_______
_______
_______
Reportable segment assets
1,649
397
5,924
127
8,097
_______
_______
_______
_______
_______
Reportable segment liabilities
1,854
153
26
1,098
3,131
_______
_______
_______
_______
_______
External revenue by location of customers
Non-current assets by location of assets
30 June 2025
30 June 2024
30 June 2025
30 June 2024
$'000
$'000
$'000
$'000
United States
2,001
2,136
949
650
United Kingdom
-
-
6,767
5,608
Australia
-
-
-
133
_______
_______
_______
_______
2,001
2,136
7,716
6,391
_______
_______
_______
_______
Revenues by key customers
Revenues from Customer A totalled $281,740 (2024: $323,163), which represented 14% (2024: 15%) of total domestic sales in the United States, Customer B totalled $907,679 (2024: $1,022,442) which represented 45% (2024: 48%) Customer C totalled $633,012 (2023: $ 404,104) which represented 32% (2024: 19%), and Customer D totalled $184,547 (2024: 334,977) which represented 9% (2024: 16%).
5. Operating Loss
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Operating gain/loss is stated after charging/(crediting):
Other Income
(36)
-
-
Directors' fees and emoluments
155
39
160
Equipment rental
-
-
11
Equipment maintenance
-
31
60
Fees payable to the company's auditor for the
-
-
89
audit of the parent company and consolidated financial statements
Non- Audit Services
-
6
-
Salaries, wages, and other staff related costs
330
336
686
Legal, professional and consultancy fees
244
53
138
Other Expenses
220
76
230
_______
_______
_______
Overhead Expenses
949
541
1,374
_______
_______
_______
Lease Interest
23
9
19
Interest
-
21
9
Finance Fee
23
Foreign exchange
13
10
13
Amortisation of Right of use assets
194
158
334
Depreciation
12
8
18
Share based payments
-
-
-
Discontinued operations
-
-
113
Impairment
38
25
-
_______
_______
_______
Total
1,229
772
1,903
_______
_______
_______
6. Intangible assets - exploration and evaluation costs
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Cost
Opening balance for the period
5,901
5,568
5,568
Additions for the period
378
235
444
Grant Reimbursement
-
-
(26)
Foreign exchange difference
478
(211)
(85)
_______
_______
_______
Closing balance for period
6,757
5,592
5,901
_______
_______
_______
7. Property, plant and equipment
Development Asset
Plant and Machinery
Total
$'000
$'000
$'000
Cost
At 1 January 2024 (audited)
8,033
723
8,756
________
________
________
Additions
113
-
113
Reclassify to disposal asset
(8,146)
(328)
(8,474)
Foreign exchange difference
-
7
7
_______
________
_______
At 31 December 2024 (audited)
-
402
402
________
________
________
Additions
-
64
64
Foreign exchange difference
-
(12)
(12)
_______
________
_______
At 30 June 2025 (unaudited)
-
454
454
________
________
________
Depreciation
At 1 January 2024 (audited)
(8,033)
(643)
(8,676)
________
________
________
Charge for the period - impairment
(113)
-
(113)
Charge for the period - depreciation
-
(18)
(18)
Reclassify to disposal asset
8,146
328
8,474
Foreign exchange difference
-
(9)
(9)
________
________
________
At 31 December 2024 (audited)
-
(342)
(342)
________
________
________
Charge for the period - depreciation
-
(12)
(12)
Foreign exchange difference
-
7
7
________
________
________
At 31 June 2025 (audited)
-
(347)
(347)
________
________
________
Carrying Value
As at 30 June 2025 (unaudited)
-
72
72
________
________
________
As at 31 December 2024 (audited)
-
60
60
________
________
________
As at 30 June 2024 (unaudited)
-
72
72
________
________
________
8. Leases
The Group has leases for an office, plant and machinery 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.
Plant, Machinery and Vehicles
Total
$'000
$'000
Right of Use Assets
$'000
$'000
As at 1 January 2024 (audited)
453
453
Additions
302
302
Amortization
(161)
(161)
________
________
As at 30 June 2024 (unaudited)
594
594
________
________
Additions
638
638
Amortization
(179)
(179)
________
________
As at 31 Dec 2024 (Audited)
1,053
1,053
________
________
Additions
-
-
Amortization
(201)
(201)
________
________
As at 30 June 2025 (unaudited)
852
852
________
________
Plant, Machinery and Vehicles
Total
Lease Liabilities
As at 1 January 2024 (audited)
455
455
Additions
300
300
Interest Payments
9
9
Lease Payments
(166)
(166)
________
________
As at 30 June 2024 (unaudited)
598
598
________
________
Additions
675
675
Interest Payments
10
10
Lease Payments
(177)
(177)
________
________
As at 31 Dec 2024 (Audited
1,106
1,106
________
________
Additions
-
-
Interest Payments
23
23
Lease Payment
(231)
(231)
________
________
As at 30 June 2025 (unaudited)
898
898
________
________
Lease Liability
June 2025
June 2024
December 2024
Current
268
223
369
Non-Current
630
375
737
________
________
________
898
598
1,106
________
________
________
9. Dividends
No dividend is proposed for the period.
10. Earnings per share
Earnings per ordinary share have been calculated using the weighted average number of shares in issue during the relevant financial year as provided below.
6 months to 30 June 2025 (Unaudited)
6 months to 30 June 2024 (Unaudited)
Year to 31 December 2024 (Audited)
$'000
$'000
$'000
Weighted average number of shares - Basic
2,117,253,750
2,015,964,616
2,015,964,616
Weighted average number of shares - Diluted
2,117,253,750
2,015,964,616
2,015,964,616
Earnings (loss) for the period
$151,000
$667,000
$1,305,000
Earnings per share in the period - Basic
¢0.007
¢0.033
¢0.064
Earnings per share in the period - Diluted
¢0.007
¢0.033
¢0.064
11. Share capital and premium
30 June 2025
30 June 2025
30 June and 31 December 2024
30 June and 31 December 2024
No
$'000
No
$'000
Allotted, called up and fully paid
Ordinary shares
2,349,297,949
53,534
2,015,964,616
52,303
____________
____________
____________
____________
During the period, in May 2025 the Company issued 333,333,333 Ordinary shares of 0.1pence each at a price of 0.3 pence per share to raise gross proceeds of £1,000,000.
Share options and warrants
The following Warrants were in issue during the period. No Warrants or Options were issued, lapsed or expired during the period.
Date of Grant
Number of warrants
Exercise price
Expiry date
10 March 2023
10,000,000
0.50p
31 December 2025
01 April 2024
10,000,000
0.50p
31 December 2025
____________
____________
____________
12. Post balance date events
Subsequent to 30 June 2025, on 15 August 2025 options over 145 million new ordinary shares of £0.001 each in the Company were issued. These Options have an exercise price of £0.004 per share and expire on 15 August 2035. The options carry certain vesting rights, with 50% becoming exercisable upon the share price trading above 0.5p per share for a 30-day VWAP, and 50% become exercisable upon publication of a new Mineral Resource Estimate.
Copies of this interim report will be made available on the Company's website, www.strategicminerals.net.
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