REG - Sunrise Resources - Final Results
13/02/2025 09:15
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RNS Number : 0166X Sunrise Resources Plc 13 February 2025
("Sunrise" or the "Company")
13 February 2025
Audited Results for the year to 30 September 2024
Sunrise Resources plc is pleased to announce its Chairman's Statement and
audited results for the year ended 30 September 2024.
The Company will announce posting of its Annual Report and Financial
Statements which will also be published on the Company's website along with
Notice of the Annual General meeting in due course.
For more information please contact:
Sunrise Resources plc Tel: +44 (0)1625 838 884
Patrick Cheetham, Executive Chairman
Tel: +44 (0)207 628 3396
Beaumont Cornish Limited
Nominated Adviser
James Biddle/Roland Cornish
Tel: +44 (0)207 469 0930
Peterhouse Capital Limited
Broker
Lucy Williams/Duncan Vasey
Market Abuse Regulation (MAR) Disclosure
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 which forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.
Nominated Adviser
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.
Qualified Person Information:
The information in this release has been compiled and reviewed by Mr. Patrick
Cheetham (MIMMM, MAusIMM) who is a qualified person for the purposes of the
AIM Note for Mining and Oil & Gas Companies. Mr. Cheetham is a Member of
the Institute of Materials, Minerals & Mining and also a member of the
Australasian Institute of Mining & Metallurgy.
Chairman's Statement
Dear Shareholders,
I am pleased to present your Annual Report for 2024 which covers the financial
year ended 30 September 2024 and significant post year-end developments.
The Company's strategy is to identify, acquire and explore projects at low
cost where value can be added quickly and cheaply. With one exception, our
projects are located in mining friendly Nevada, USA, and include industrial
mineral projects as well as more conventional gold and base-metal projects.
Industrial mineral producers are generally not good explorers and so we are
exploiting a niche opportunity to identify and explore potential new
industrial mineral deposits and then partner with specialist industrial
mineral producers to generate cash flow and future royalty interests that will
provide a long-term sustaining cash flow for the Company.
Since the start of the year, this strategy has generated income of US$185,000
during the reporting period and a further US$75,000 after the financial
year-end from various project payments offsetting a significant part of our
administration costs and reducing the requirement for equity fundraising.
As of the date of this report, the Company holds interests in three key
industrial mineral projects, a number of royalty interests, and various base
and precious metal projects, details of which can be found in the Operating
Review.
Natural Pozzolan-Perlite Projects
The Company holds two natural pozzolan deposits in Nevada at the CS and Hazen
projects.
The natural pozzolan deposits that underpin the CS Project, including perlite
deposits, were discovered by the Company and secured by low-cost claim
staking. The Company has taken this project through drilling, testwork and
mine permitting with a total expenditure to year-end of just US$1.7million.
This is a notable achievement especially when considered in the usual time
frame for discovery and mine permitting which typically takes ten years or
more.
In normal circumstances, substantial value is added through the definition of
minable deposits and the completion of mine permitting, but realisation of
this value has yet to be achieved for shareholders. This is due in large part
to a slower than anticipated uptake of natural pozzolan, but the direction of
travel we laid out in detail in the 2023 annual report remains clear, and is
driven by the need to produce cement and concrete with less embodied carbon.
The lack of material news in 2024 for our pozzolan-perlite projects belies the
efforts being made by the Company to secure routes to development. We are
currently in discussions with four groups regarding possibilities for the sale
or joint development of the CS Project. These companies range from private but
well-funded start up groups to major international cement companies and the
opportunities for the Company are different in each case, varying from
possible project start-ups to joint developments. Some discussions include
both the CS Project and the less advanced Hazen Project.
The Company is able to maintain the CS Project's mine-ready status at low cost
and with no time constraints as to when mining must start, save for periodic
renewals of the air quality permit and payment of annual claim fees. This is a
helpful factor in negotiations.
We are starting to see the market for natural pozzolans expanding beyond the
conventional cement and concrete industries. Existing producers are developing
specialist products for the oil well drilling industry, which is expected to
benefit from increased drilling activity under the new Trump Administration,
and we are starting to see new markets in the paint and coatings industry
where, for example, pozzolans can reduce the amount of high-cost titanium
dioxide pigments used in paint. Other applications include the use of pozzolan
as a lightweight aggregate, with tests on our own CS Project pozzolan having
been very encouraging.
Pioche Sepiolite Project
During the reporting period, our Pioche Sepiolite Project was under option to
Spanish sepiolite producer Tolsa S.A . ("Tolsa"). Tolsa carried out a drilling
programme in the summer of 2024, having extended its option for twelve months
in December 2023.
Up to the end of the option period the parties had been negotiating more
detailed agreements to govern the terms of calculation and payment of the
agreed 3% royalty that would have been payable to Sunrise and the conveyance
of the project claims. However, these negotiations were not concluded, there
was no agreement on the terms for calculation and verification of the
production royalty, and Tolsa did not exercise its option to purchase the
Project.
During contract negotiations Tolsa indicated that whilst large deposits of
sepiolite clay have been defined by the wide-spaced drilling carried out to
date at Pioche, it has been difficult to correlate specific sepiolite grades
(and so values) between drill holes. This may have been an additional factor
in Tolsa's decision, but the Company has been advised that sepiolite deposits
in Nevada differ significantly in origin and character from those exploited in
Tolsa's existing operations in Spain and that we should not expect to see
correlation of specific sepiolite grades between the widely spaced holes
drilled to date.
Given these circumstances, we do not see Tolsa's decision as a reflection on
the value of the Project. Tolsa has expressed interest in alternative
arrangements and we are also in contact with a number of other companies that
have expressed interest in the Project.
Tolsa has paid the Company US$150,000 in option fees to date, whilst our
expenditure on the Pioche Project, at around £50,000, is just a small
fraction of the money we believe has been spent by Tolsa in evaluating the
Project and from which we stand to benefit.
One of the most significant markets for sepiolite in the USA is for use in
drilling muds that stabilise drill holes in the oil industry. This market is
expected to boom under the new Trump administration. At the same time,
America's only sepiolite producer, Lhoist-IMV, is severely constrained, being
surrounded by areas designated as 'Areas of Critical Environmental Concern'.
Royalty Interests
Earlier this year we were pleased to add another royalty interest to our
portfolio when we sold our interest in a group of claims covering surface
deposits of diatomite at Crow Springs in Nevada to local diatomite producer
Dicalite Management Group ("Dicalite") for US$150,000, the final instalment of
the purchase price having now been paid.
Sunrise has retained a royalty of US$6/dry ton of diatomite mined and the
prospect of our first royalty income moved a step closer recently as Dicalite
plans to extract a 1,000-ton sample and is submitting a mine plan for
operations to the Bureau of Land Management ("BLM"). We believe that Dicalite
has the ability and ambition to turn this royalty to account in a relatively
short time frame with production slated for its processing plant in Basalt,
Nevada. The royalty interest relates to a group of 29 claims covering an area
of some square kilometres, much of which is underlain by diatomite.
At the Garfield Project, where we hold a 2% net smelter return royalty,
operator Guardian Metal Resources announced significant progress during the
year with the definition of a large target for porphyry copper mineralisation
within our royalty area. We anticipate this project will be drill tested in
2025.
Base-Metal and Gold Projects
In the summer of 2024, a field reconnaissance programme highlighted a new area
of mineralisation at our Reese Ridge Zinc-Lead-Silver-Gallium Project where
surface samples yielded up to 24.5% combined lead-zinc and 383g/t silver.
Previous samples from Reese Ridge have also shown high levels of gallium, up
to 69ppm, an essential mineral controlled by China and used in the production
of semi-conductors and increasingly used in the production of solar panels and
high frequency computer chips.
All of the high-grade mineralisation found to date overlies a geophysical
anomaly which the Company believes could be indicative of a significant zone
of sulphide mineralisation and this exciting target needs to be drill tested.
The geological setting and geological features of the target are consistent
with a Carbonate Replacement Deposit style of mineralisation. These can be
large and high-grade. A relevant example is the Hermosa Project in the
neighbouring State of Arizona which was acquired by South32 Limited in a
US$1.3 billion takeover.
The Reese Ridge Project represents a significant opportunity for the Company.
Further work is justified and will include ground geophysics and drilling.
At Jackson's Wash, the current lease and option holder is Kinross Gold
Corporation ("Kinross"). Our claims form part of a larger project where
Kinross has submitted a plan of operations to the BLM for a large exploration
programme. The project is under lease/option to Kinross who can purchase the
claims for US$500,000 in which case Sunrise will retain a 3% net smelter
return royalty.
Other than this, our 100% owned/operated projects were largely on hold during
the year as we sought to preserve cash whilst awaiting Tolsa's decision on the
exercise of its option on the Pioche Sepiolite Project.
Outlook
Whilst global markets, particularly the market for tech stocks, has been
strong in 2024, the market outlook for AIM-traded exploration companies in
2025 remains uncertain. However, commodity prices are strong and there is
growing interest in the minerals we hold. We have real reason to be optimistic
that we can bring key projects to account in 2025.
Annual General Meeting
We look forward to meeting shareholders at our next Annual General Meeting
which will be held in London on 13 March 2025 where Mr. James Cole will be
retiring and standing for re-election, as is customary each three years.
I am grateful to all our partners, our staff in the UK and people on the
ground in Nevada. Their hard work has positioned the Company for growth and we
look forward to reporting the Company's progress in 2025.
Sincerely,
Patrick Cheetham
Executive Chairman
12 February 2025
Strategic Report
The Directors present their Strategic Report for the year ended 30 September
2024.
The principal activity of the Company is the acquisition, exploration and
development of mineral projects, primarily in the western USA.
Our strategy is to develop cash flow from the Company's key projects, through
joint mine developments, project sales and joint ventures as well as royalty
interests, in order that the Company's activities become self-funding.
The Company's Business Model is to acquire 100% ownership of mineral assets at
minimal expense. This is usually accomplished through the identification of
exploration opportunities and low-cost claim staking or applying for
exploration licences from the relevant authority. This is the case for all but
one of the Company's projects. In other cases, rights are negotiated with
existing project owners for initially low periodic payments that rise over
time as confidence in the project value increases.
The Group currently operates with a low-cost base to maximise the funds that
can be spent on value adding exploration and development activities. The
Company's administration costs are reduced via a cost sharing Management
Services Agreement with Tertiary Minerals plc ("Tertiary").
The Company's ambition is to deliver on this strategic plan and details of the
Company's projects and developments during the reporting period are given in
the Operating Review.
Until the Company becomes profitable and self-funding, its operations are
financed by periodic capital raisings, through private share placings, the
issue of other financial instruments and through project sales and joint
ventures. Where possible the Board will seek to secure additional funding from
a range of sources, for example debt funding, pre-financing through offtake
agreements and other joint arrangements.
Over the past few years, the Company has established a valuable portfolio of
drill-ready precious metal, base metal and industrial mineral projects. Our
strategy remains to valorise those projects through sale or other arrangements
seeking, wherever possible, free-carried exposure to increases in value and
production from the projects.
Organisation Overview
The Group's business is directed by the Board and is managed by the Executive
Chairman. The Company has a Management Services Agreement with Tertiary which
was the original parent of the Company. Under this cost sharing agreement,
Tertiary provides all of the Company's administration and technical services,
including the technical and management services of the Executive Chairman, at
cost. Day-to-day activities are managed from Tertiary's offices in
Macclesfield in the United Kingdom, but the Group operates in two other
countries and the corporate structure of the Group reflects the historical
pattern of project acquisition by the Group and the need, where appropriate,
for fiscal and other reasons, to have incorporated entities in particular
territories.
The Group's exploration activity in Nevada, USA, is undertaken through two
local subsidiaries, SR Minerals Inc. and Westgold Inc.
In Australia, the Company operates through an Australian subsidiary, Sunrise
Minerals Australia Pty Ltd.
The Board of Directors comprises two independent non-executive directors and
the Executive Chairman. The Executive Chairman is also Executive Chairman of
Tertiary, but otherwise the Board is independent of Tertiary. Tertiary is not
a significant shareholder (as defined under the AIM Rules) in the Company.
Financial & Performance Review
The Group is not yet producing minerals and so has no income other than a
small amount of bank interest and payments from project transactions.
Consequently, the Group is not expected to report profits until it disposes of
or is able to profitably develop or otherwise realise the value of its
exploration and development projects.
The Group reports a loss of £658,806 for the year (2023: £391,291) after
administration costs of £386,766 (2023: £425,419). The loss includes an
impairment charge of £422,135 of exploration costs in connection with the Bay
State Project, and also includes a credit from expensed pre-licence and
reconnaissance exploration of £304 (2023: £3,753), other income of £78,435
(2023: £36,881) being an option fee paid by Tolsa USA, Inc. in connection
with the Pioche Project and a lease payment made by Kinross Gold U.S.A., Inc.
in connection with the Jacksons Wash Project. Revenue included £112,050
(2023: £Nil) for the sale of the CS Diatomite Project to Dicalite Management
Group. Administration costs include a charge of £6,147 (2023: £5,319)
relating to the value of certain share warrants held by employees of Tertiary
and by third parties calculated in accordance with IFRS 2.
The Financial Statements show that, at 30 September 2024, the Group had net
current liabilities of £40,649 (2023: £87,991). This represents the cash
position and receivables, less trade and other payables, and amounts owing
under the Convertible Note held by Towards Net Zero, LLC. These amounts are
shown in the Consolidated and Company Statements of Financial Position and are
also components of the net assets of the Group. Net assets also include
various "intangible" assets of the Company. As the term suggests, these
intangible assets are not cash assets but include some of this year's and
previous years' expenditure on mineral projects where that expenditure meets
the criteria in Note 1(d) of the accounting policies. The intangible assets
total £1,832,826 (2023: £2,409,311).
Details of intangible assets, investments and right of use assets are also set
out in Notes 10, 9 and 18 respectively.
Net assets also include the market value at the year-end of shares in VR
Resources Ltd and Power Metal Resources plc which are held as "available for
sale" investments as set out in Note 9.
As part of the financial results, a prior year adjustment has been made which
is detailed in Note 27.
Impairment
Expenditure which does not meet the criteria for continued capitalisation set
out in Note 1(n), such as pre-licence and reconnaissance costs, are expensed
and added to the Company's loss. The loss reported in any year can also
include expenditure for specific projects carried forward in previous
reporting periods as an intangible asset but which the Board determines is
impaired in this reporting period.
It is a consequence of the Company's business model that there will be
impairments of unsuccessful exploration projects from time to time. The extent
to which expenditure is carried forward as intangible assets is a measure of
the extent to which the value of the Company's expenditure is preserved.
A review is carried out twice each year by the Directors as to whether there
are any indications of impairment of the Group's assets.
An impairment review of the carrying values of exploration and development
projects (and in the Company, the associated intercompany loans) as at 30
September 2024 was undertaken by the Directors in accordance with IFRS 6 and
IAS 36. As a result of the year-end review it was judged that the Bay State
Project should be impaired and that the Sunrise Minerals Australia Pty Ltd
intercompany loan should also be impaired. Further information on the
judgements made can be found in the Operating Review. Projects which are held
for sale or joint venture have not been impaired as it is anticipated that
their carrying values will be recovered through sale or through residual joint
venture interests in future.
The intangible asset value of a project, shown at cost, should not be confused
with the realisable or market value of a particular project which will, in the
Directors' opinion, be at least equal in value and often considerably higher.
The Company finances its activities through share capital placings and other
arrangements, and, occasionally, asset sales. As the Company's projects become
more advanced there may be strategic opportunities to obtain funding for some
projects through joint venture, production sharing, royalty and other
marketing arrangements.
Key Performance Indicators
The financial statements of a mineral exploration and development company can
provide a moment in time snapshot of the financial health of a company but do
not provide a reliable guide to the performance of the Company or its Board.
The usual financial key performance indicators ("KPIs") relating to financial
performance are neither applicable nor appropriate to measure the value
creation of a company which is involved in mineral exploration and development
which currently has no turnover. The applicable KPIs are predominantly
qualitative rather than quantitative and relate to the success, or otherwise,
of exploration and mineral discovery on the Group's projects which is
extensively covered in the Operating Review as set out in the Strategic
Report.
The Company seeks to reduce its overhead costs, where practicable, but is
reporting administration costs this financial year of £386,766 (2023:
£425,419). This includes, but is not limited to, legal costs associated with
agreements and increases in audit fees, together with foreign exchange
variances during the year.
In exploring for valuable mineral deposits, we accept that not all our
exploration will be successful but also that success can be rewarding. We
therefore expect that our shareholders will be invested for the potential for
capital growth taking a long-term view of management's track record in mineral
discovery and development.
Fundraising
The Directors prepare annual budgets and cash flow projections that include
the proceeds of future fundraisings which will be required within the next 12
months in order to meet the Group's overheads and planned discretionary
project expenditure. Fundraisings in the future will be required based on
projections for the Group and the Company to meet their liabilities as they
fall due and continue to operate on a going concern basis.
Operating Review
Sunrise Resources plc is a mineral exploration and development company with
operations in Nevada, USA, and Western Australia.
The Company's projects in Nevada are held through two 100% owned subsidiary
companies, SR Minerals Inc., which holds the Company's industrial minerals and
certain longer established projects, and Westgold Inc. which holds the
Company's interest in more recently acquired gold and base-metal projects in
Nevada. The Company's Baker's Gold Project in Australia is held through an
Australian subsidiary, Sunrise Minerals Australia Pty Ltd.
Industrial Minerals Projects
CS & HAZEN POZZOLAN PROJECTS, NEVADA, USA (100% Owned)
The Company holds two projects for natural pozzolan.
The CS Project, located in south central Nevada, also contains deposits of
perlite and is "mine-ready" with the key operating permits already in place
covering 14.5 million tons of pozzolan and 1.3 million tons of perlite. An
additional area, the Northeast Zone, presents a large additional target for
natural pozzolan. The CS Project pozzolan is aimed at the cement and concrete
markets of southern California.
The Hazen Project, an earlier stage project, is located close to Reno in
northern Nevada, conveniently placed to serve markets in northern Nevada and
in northern California.
For some time now, the Company has been in discussions with various groups
with the objective of securing investment and material offtake agreements for
the development of both the CS and Hazen Projects. These discussions usually
involve extensive testing of the material, both in its own right and as a
blend with proprietary cements and/or other cement blends.
Current discussions and ongoing testwork involve:
· a large multinational cement company that has extensive cement
and ready-mix businesses in the western USA. Discussions with this company
originated some time ago and have recently been revived with testwork in
progress aimed at introducing the Company's natural pozzolans to their
ready-mix group.
· an existing multinational industrial minerals producer looking to
produce various cementitious materials for the mining industry. This company
has completed initial due diligence testwork and, recently, a due diligence
field visit.
· an established producer of natural pozzolan which is considering
use of our natural pozzolan as a beneficial additive to their existing planned
production of cementitious materials and is continuing its testwork programme.
The Company is able to maintain the mine-ready status of its CS Project at low
cost and with no time constraints as to when mining must start, save for
periodic renewals of the air quality permit and payment of annual claim fees.
What is Natural Pozzolan?
Natural pozzolan is a naturally occurring Supplementary Cementitious Material
("SCM") that is used to partially replace and reduce the use of ordinary
Portland cement, a major source of the greenhouse gas CO(2) in cement mixes,
concrete and mortars.
Natural pozzolan also takes the place of coal fly ash pozzolans, the supply of
which is rapidly declining in the western world due to the continued closure
of coal-fired power stations.
The natural pozzolan on the Company's projects in Nevada is a pozzolanic
volcanic glass that needs only to be ground to be used as a SCM.
What is Perlite?
Perlite is a glassy raw material which expands on heating by up to 20 times in
volume into a white or pale coloured low-density material. Expanded perlite is
used in various industrial and household applications such as insulation,
paint texturing, plaster and concrete fillers, building material fillers,
formed insulation and fire-proofing. It also has application as filter aids,
insulating industrial cryogenic storage vessels and as a potting medium in
gardening and horticulture to aid water retention and aeration of the soil. In
recent years, especially during the Covid lockdown period, one of the largest
areas of growing demand was for large-scale hydroponic farming resultant of
the legalisation of cannabis in many US states.
According to the United States Geological Survey, production of raw perlite in
the USA was steady in 2022, at around 650,000 tons with a modest 5% rise in
demand being met by an increase in imports rather than an increase in domestic
production. Demand for perlite for use in horticulture has weakened, as some
growers substitute perlite with cheaper wood fibre, and there has been a
levelling off in demand from the cannabis growing market post-Covid.
PIOCHE SEPIOLITE PROJECT, NEVADA
The Pioche Sepiolite Project (the "Pioche Project") is located close to the
historic mining town of Pioche in Lincoln County, Nevada. It lies within 4km
of US Highway 93, from which it can be accessed by a network of 4WD tracks,
and 47km from rail at the town of Caliente, Nevada.
During the reporting period, Tolsa USA, Inc., a subsidiary of Tolsa S.A.
("Tolsa"), the world's largest producer of sepiolite, extended its option to
purchase the Pioche Project after agreeing in December 2023 to pay an option
extension fee of US$100,000 and an increase in the purchase price from US$1.2
million to US$1.4 million.
In July 2024, a second phase drilling and pitting programme was successfully
completed by Tolsa using the sonic drilling method and was focussed on the
central and eastern area of the claim block (Phase 1 drilling in 2022 focused
on the central and western areas). Twelve vertical holes were completed for a
total of 460m over an area of 160ha and six pits were dug using an excavator
to sample well defined sepiolite beds at surface. One hundred and seven
separate drill samples and 6 pit samples were sent to Tolsa's lab in Spain for
sepiolite characterisation.
On 26 December 2024, Tolsa gave notice to the Company that it would not be
proceeding to exercise its Pioche Project option although it is open to
discussion on alternative arrangements for the Project. The Company will now
ensure that Tolsa meets its contractual obligations to provide the Company
with the detailed project data produced by Tolsa and all remaining exploration
samples. Delivery of all project data and geological sample material will
enable the Company to make an independent evaluation of the project and
discussions have been initiated with other interested parties.
During the option period, the Company received US$150,000 in option payments
from Tolsa and up to the financial year-end the Company has spent US$39,929 on
the project.
What is Sepiolite
Sepiolite is a non-swelling, lightweight, porous clay with outstanding
sorption capacity. The largest market globally for sepiolite is for use in
lightweight non-clumping pet litters, where it has superior properties
compared to other clays used in this application. It is also used extensively
in agriculture as a slow-release absorbent and adsorbent carrier for chemicals
and pesticides, in animal feeds as a binder and carrier for nutrients and
growth promoter. It is also used as a suspending agent in paints, medicines,
pharmaceuticals and cosmetics, and in high temperature drilling muds.
Sepiolite is a very uncommon clay and there are very few commercial deposits
in the world, and, with one exception, there are no significant sepiolite
deposits known in the US, so a large potential market would exist for any new
US producer of sepiolite.
NEWPERL PERLITE PROJECT, NEVADA (100% Owned)
The NewPerl Project is located approximately 85km from the CS Project in south
central Nevada, USA, and contains a number of areas where surface samples have
shown excellent test results for production of horticultural grades of
perlite. Subject to further testing, this could be suitable for feed into the
CS Project in the future.
Drill testing of the NewPerl Project, scheduled for 2024, was deferred as a
cost saving measure.
Gold, Silver & Base Metal Projects
REESE RIDGE PROJECT, NEVADA (100% Owned)
The Reese Ridge Project is located 83km south-southwest of Battle Mountain,
Nevada. It covers a ridge-forming fault-bounded horst block of
limestones/shales fault-juxtaposed against younger shales all bounded to the
east and west by Tertiary age volcano-sedimentary basins.
The limestone is host to numerous prospector' workings that targeted
conspicuous iron-rich gossans with exotic geochemistry and consistently
anomalous zinc, lead and silver with values up to 6.8% zinc, 3.3% lead and
51g/t silver. Forty-three samples taken from these gossans and old workings
averaged 0.86% zinc.
Subsequently, prospecting by the Company discovered high zinc and lead values
in visually unremarkable limestone containing a few spots of the lead sulphide
mineral galena and a high-grade analysis of 15.9% zinc (alongside 0.3% lead
and 17ppm silver). Follow-up sampling yielded high-grade samples containing up
to 29.6% zinc, 0.3% lead, 7ppm silver, 68ppm gallium.
In July 2024, the Company contracted geological consultants, Big Rock
Exploration, to carry out a 3-day field reconnaissance programme using a pXRF
analyser to gather real-time field information on the zinc, lead and silver
levels across different parts of the project area. Extreme summer temperatures
were experienced during the fieldwork (+40(o)C) which adversely affected the
operation of the pXRF and the accuracy of readings. The pXRF did, however,
help direct the collection of field samples for subsequent laboratory
geochemical analysis.
This latest work has highlighted an area some 260m west of the previously
identified high-grade samples where two rock samples yielded very high lead,
zinc and silver results as follows:
Ø +24.5% combined lead-zinc and 383g/t silver in sample 24RR-AL19.
(4.5% zinc and greater than 20% lead, the upper instrument detection limit for
the chosen analytical method)
Ø 18.6% combined zinc-lead and 51g/t silver in sample 24RR-AL18.
(11.7% zinc and 6.9% lead)
Sample 24RR-AL18 was taken from an old mine dump whereas sample 24RR-AL19 was
taken from a rock outcrop. Outcrop in the project area is generally very poor
due to the extensive scree deposits.
Widespread barite was also reported from scree by Big Rock Exploration.
Previous samples from Reese Ridge have shown high levels of gallium, up to
68ppm. Gallium is an essential mineral in the production of semi-conductors
and is increasingly used in the production of solar panels and high frequency
computer chips. It is extracted from some zinc ores and approximately 80% of
the world's gallium is produced in China. China has placed some restrictions
on the export of gallium and gallium compounds. The analytical method used for
the most recent samples had a lower detection limit for gallium that was too
high (50ppm) to give meaningful results.
In its news release of 31 October 2023, the Company announced that modelling
of historical airborne geophysical data had confirmed a large annular zone of
low resistivity (high conductivity) below the surface mineralisation that
extends from just below near surface to a depth of nearly 1,000m. This annular
zone surrounds a core of high resistivity which the Company interprets as a
granitic intrusion. All of the high-grade mineralisation found to date
overlies this low resistivity zone which the Company believes could be
indicative of a significant zone of sulphide mineralisation related to the
high grade surface mineralisation.
The geological setting and geological features of the target at Reese Ridge
are consistent with a Carbonate Replacement Deposit ("CRD") style of
mineralisation. These can be large and high-grade. A relevant example is the
Hermosa Project in the neighbouring State of Arizona which was acquired by
South32 in a US$1.3 billion takeover and which includes the Taylor Deposit
(138 million tonne Mineral Resource with a zinc equivalent grade of 8.61%) now
under development. A more recent CRD discovery has been made in Nevada by i-80
Gold Corp. at the Ruby Hill Project where spectacular zinc and silver drill
intersections have been reported.
The Reese Ridge Project represents a significant opportunity for the Company.
Further work is justified to include ground geophysics and drilling.
JACKSON WASH GOLD & PERLITE PROJECT, NEVADA (under lease/option to Kinross
Gold U.S.A., Inc.)
The Jackson Wash Project is located 16km from the NewPerl Project in Nevada
and was acquired as a target for horticultural grade perlite. However, the
project area is also prospective for gold and silver.
The claims are currently leased to global gold producer Kinross Gold U.S.A.,
Inc. ("Kinross") which also holds an option to purchase the claims at any time
before 6 October 2030 for US$500,000 and the grant to Sunrise of a 2.5% Net
Smelter Return Royalty.
For Kinross, the Company's Jackson's Wash Project claims form part of a larger
project area centred on the historic Montezuma silver, gold and mercury mining
centre. This is an active exploration area for Kinross and during the
reporting period Kinross advised the Company that it is currently planning to
increase its exploration activity in the wider project area.
OTHER PROJECTS
No work was carried out in 2024 on the Company's Clayton Silver, Newark Gold,
or Ridge Limestone Projects in Nevada or its Baker's Gold Project in
Australia. However, all project claims were maintained and the Company
continues to hold the projects as an essential pipeline of exploration
projects for the Company.
The value of the Bay State Project has been impaired as at 30 September 2024,
but the Company continues to maintain its interests in the project for the
time being.
ROYALTY INTERESTS
Crow Springs Diatomite Project
In April 2024, the Company sold a group of mining claims held for the
industrial mineral diatomite in the Crow Springs area of Nevada, USA, to
Dicalite Management Group ("Dicalite"). Dicalite is privately owned and is a
vertically integrated international industrial mineral company.
The claims, now sold, cover an area of 2.4 sq. km. and are underlain by
extensive deposits of diatomite.
Half of the US$150,000 purchase price was paid on transfer of the claims and
the remaining $75,000 was paid in November 2024 on submission of an
application to the Bureau of Land Management to extract a 1,000-ton sample
from the project. Dicalite plans to submit a mine plan of operations shortly
with the intent to use the Crow Springs diatomite as a feed source for its
diatomite processing plant at Basalt some 85km distance by road.
Sunrise retains a royalty of US$6/dry ton of diatomite mined and extracted
from the claims and Dicalite will have an option to purchase the royalty for
US$500,000 after the 10(th) anniversary of the first royalty payment.
The agreement excludes the Company's County Line Diatomite Project claims
which are retained by the Company.
What is Diatomite?
In its raw form, diatomite is a valuable industrial rock formed by the
accumulation in marine and freshwater lake environments of vast quantities of
skeletal material from single celled aquatic algae called diatoms.
Diatoms have hollow and lattice-like silica skeletons and the mass
accumulation of these skeletons during algal blooms forms a rock with very
high porosity. After processing, which can include heating to a high
temperature (calcining) to improve quality, diatomite is used, for example, in
filtering beer, liquor, wine, fats, fruit juices, and solvents. Commercial
deposits of diatomite have a high brightness, a low bulk density and chemical
inertness which also make it a suitable filler or carrier material in various
industrial and domestic products.
About Dicalite
Dicalite Management Group is a vertically integrated international industrial
minerals company founded in 1928. It produces and processes diatomite
(diatomaceous earth), perlite and vermiculite from 17 facilities in the U.S.
and Europe comprising five strategic mines and twelve processing facilities.
This includes a diatomite processing plant and associated mining operations at
Basalt, Nevada, the fourth oldest continually operated mine in the state of
Nevada.
Two varieties of diatomite are made at the Basalt Plant, calcined and natural.
GARFIELD PROJECT, NEVADA
The Company holds a 2% Net Smelter Return Royalty at the Garfield Project
following its sale to Golden Metal Resources plc now renamed as Guardian Metal
Resources ("GMR").
The Garfield Project is located in the prolific Walker Lane Mineral Belt in
Nevada, USA. Last year GMR advised that exploration work "has confirmed the
potential for large scale porphyry and skarn type copper mineralised bodies"
with copper mineralisation now defined in two zones, named the Power Line Zone
and High-Grade Zone, following the completion of rock chip sampling and a soil
geochemical sampling programme. Subsequent geophysical exploration has
confirmed this potential.
The Power Line Zone is a northeast-southwest trending copper-in-soil anomaly
which extends for over 1,500m in length (remains open towards the southwest),
located in the west of the project area. The Power Line Zone connects the
original Garfield Project area discovered by the Company with a previously
isolated zone located towards the southwest, where limited historical rock
sampling results returned up to 2.6% copper and 0.54g/t gold.
At the High-Grade Zone, a circa 1.5km by 0.8km copper-in-soil anomaly, which
remains open towards north, south and east, is located in the southeast of the
Project area and approximately 1km southeast of the Power Line Zone. Limited
historical rock sampling completed near what is now the western end of the
High-Grade Zone returned up to 5.53% copper, which highlights the potential of
this large, newly defined copper mineralised system.
The Company's 2% Net Smelter Royalty interests covers all of the Power Line
Zone and the majority of the High Grade Zone. GMR has reported potential for
Tier 1 copper deposit at Garfield.
GMR is understood to be finalising a drill testing programme.
STONEWALL GOLD PROJECT, NEVADA
Westgold Inc. holds a 2% Net Smelter Return Royalty from GMR in the Stonewall
Project, also owned by GMR.
Stonewall is prospective for epithermal-style gold-silver mineralisation.
Health and Safety
The Group has maintained strict compliance with its Health and Safety Policy
and is pleased to report there have been no lost time accidents during the
year.
Environment
No Group company has had or been notified of any instance of non-compliance
with environmental legislation in any of the countries in which they work.
Risks & Uncertainties
The Board regularly reviews the risks to which the Group is exposed and
ensures through its meetings and regular reporting that these risks are
minimised as far as possible.
The principal risks and uncertainties facing the Group at this stage in its
development and in the foreseeable future are detailed below together with
risk mitigation strategies employed by the Board.
RISK MITIGATION STRATEGIES
Exploration Risk
The Group's business is mineral exploration and development which are The directors bring many years of combined mining and exploration experience
speculative activities. There is no certainty that the Group will be and an established track record in mineral discovery.
successful in the definition of economic mineral deposits, or that it will
proceed to the development of any of its projects or otherwise realise their
value.
The Company maintains a portfolio of exploration projects, including projects
at the drill stage, in order to spread the risk associated with mineral
exploration.
Resource/Reserve Risk
All mineral projects have risk associated with defined grade and continuity. When relevant, Mineral Resources and Reserves are estimated by independent
Mineral Resources and Reserves are always subject to uncertainties in the specialists on behalf of the Group and reported in accordance with accepted
underlying assumptions which include the quality of the underlying data, industry standards and codes. The directors are realistic in the use of metal
geological interpretations, technical assumptions and price forecasts. and mineral price forecasts and impose rigorous practices in the QA/QC
programmes that support its independent estimates.
Development and Marketing Risk
Delays in permitting, or changes in permit legislation and/or regulation, In order to reduce development risk in future, the directors will ensure that
financing and commissioning a project may result in delays to the Group its permit application processes and financing applications are robust and
meeting production targets or even the Company ultimately not receiving the thorough.
required permits and in extreme cases loss of title.
Commodity Risk
Changes in commodity prices can affect the economic viability of mining The Company consistently reviews commodity prices and trends for its key
projects and affect decisions on continuing exploration activity. projects throughout the development cycle.
Mining and Processing Technical Risk
Notwithstanding the completion of metallurgical testwork, test mining and From the earliest stages of exploration, the directors look to use consultants
pilot studies indicating the technical viability of a mining operation, and contractors who are leaders in their field and in future will seek to
variations in mineralogy, mineral continuity, ground stability, groundwater strengthen the executive management and the Board with additional technical
conditions and other geological conditions may still render a mining and and financial skills as the Company transitions from exploration to
processing operation economically or technically non-viable. production.
Environmental and Social Governance (ESG) Risk
Exploration and development of a project can be adversely affected by The Company has adopted an Environmental, Social and Governance Policy (the
environmental and social legislation and the unforeseen results of "ESG Policy") and avoids the acquisition of projects where liability for
environmental and social impact studies carried out during evaluation of a legacy environmental issues might fall upon the Company.
project. Once a project is in production unforeseen events can give rise to
environmental liabilities.
Mineral exploration carries a lower level of environmental and social
liability than mining.
The ESG Policy will be updated in the future to reflect the status of the
Company's projects.
Political Risk
All countries carry political risk that can lead to interruption of activity. The Company's strategy restricts its activities to stable, democratic and
Politically stable countries can have enhanced environmental and social mining-friendly jurisdictions.
permitting risks, risks of strikes and changes to taxation, whereas less
developed countries can have, in addition, risks associated with changes to
the legal framework, civil unrest, and government expropriation of assets.
The Company has adopted a Bribery & Anti-corruption Policy and a Code of
Conduct and these are strictly enforced.
When working in less developed countries the Company undertakes a higher level
of due diligence with respect to partners and suppliers.
Partner Risk
Whilst there has been no past evidence of this, the Group can be adversely The Company currently maintains control of certain key projects so that it can
affected if joint venture partners are unable or unwilling to perform their control the pace of exploration and reduce partner risk.
obligations or fund their share of future developments.
For projects where other parties are responsible for critical payments and
expenditures, the Company's agreements legislate that such payments and
expenditures are met.
Where appropriate, the Company carries out Due Diligence and Know Your
Customer checks on potential business partners.
Fraud Risk
Whilst there has been no past evidence of fraudulent activity in the Group, The Company and its employees have a strong working awareness of potential
Group companies can be adversely affected financially and reputationally avenues for fraud which is supported through regular anti-fraud training
should they not have appropriate IT training and financial controls in place through the Company's IT provider and ad hoc anti-fraud training as provided
which are regularly reviewed and communicated to all employees. by banking partners and third-parties.
The directors are responsible for the Group's systems of internal financial
control. Although no systems of internal financial control can provide
absolute assurance against material misstatement or loss, the Group's systems
are designed to provide reasonable assurance that problems are identified on a
timely basis and dealt with appropriately.
The Company's financial controls are assessed for suitability on an annual
basis.
Financing & Liquidity Risk
The Group's goal is to finance its exploration and evaluation activities from In carrying out their responsibilities, the directors have put in place a
future cash flows, but until that point is reached the Company is reliant on framework of controls to ensure as far as possible that ongoing financial
raising working capital from equity markets or from industry sources. There is performance is monitored in a timely manner, that corrective action is taken
no certainty such funds will be available when needed. and that risk is identified as early as practically possible, and they have
reviewed the effectiveness of internal financial controls.
The Company maintains a good network of contacts in the capital markets which
has historically met its financing requirements.
The Company's low overheads and cost-effective exploration strategies help
reduce its funding requirements. Nevertheless, further equity issues will be
required over the next 12 months.
Exchange Rate Risk
The value of the Company's assets held in overseas subsidiaries will vary with The Company's project expenditures are discretionary and subject to constant
exchange rate fluctuations, especially in the US Dollar to Pound Sterling review and changing priorities.
exchange rates.
The Company does not, therefore, speculate on exchange rates or hedge its
As much of the Company's exploration costs are incurred in US Dollars, the foreign currency exposures but will consider doing so once expenditures and
Company's budget costs will be subject to exchange rate variations when revenue become more predictable and locked in.
actually incurred.
Further information on risks associated with the Group's Financial Instruments
is given in Note 20 to the financial statements.
Forward-Looking Statements
This Annual Report may contain certain statements and expressions of belief,
expectation or opinion which are forward-looking statements, and which relate,
inter alia, to the Company's proposed strategy, plans and objectives or to the
expectations or intentions of the Company's directors. Such forward-looking
statements involve known and unknown risks, uncertainties and other important
factors beyond the control of the Company that could cause the actual
performance or achievements of the Company to be materially different from
such forward-looking statements.
Section 172 (1) Statement
Section 172 of the Companies Act 2006 requires a director of a company to act
in the way he or she considers, in good faith, would be most likely to promote
the success of the company for the benefit of its members as a whole. This
requires a director to have regard, among other matters, to: the likely
consequences of any decision in the long-term; the interests of the Company's
employees; the need to foster the Company's business relationships with
stakeholders (namely, its shareholders, employees, suppliers, clients, joint
arrangement partners and others); the impact of the Company's operations on
the community and the environment; the desirability of the Company maintaining
a reputation for high standards of business conduct; and the need to act
fairly with members of the Company.
The Company's directors give careful consideration to these factors in
discharging their duties. The stakeholders we consider are our shareholders,
employees, suppliers (including consultants and contractors), our joint
arrangement partners, the regulatory bodies that we engage with and those that
live in the societies and geographical areas in which we operate. The
directors recognise that building strong, responsible and sustainable
relationships with our stakeholders will help us to deliver our strategy in
line with our long-term objectives.
Having regard to:
The likely consequences of any decision in the long-term:
The Company's Aims and Business Model are set out at the head of this
Strategic Report and in the Chairman's Statement. The Company's mineral
exploration and development business is, by its very nature, long-term and so
the decisions of the Board always consider the likely long-term consequences
and take into consideration, for example, trends in metal and minerals supply
and demand, the long-term political stability of the countries in which the
Company operate and the potential impact of its decisions on its stakeholders
and the environment. As the Company aims to transition the CS Project into
production, other projects also become important to the long-term future of
the Company and this has framed the Board's decision to allocate a portion of
capital to the testing of some of the Company's precious metal projects and to
acquiring new projects. The Board's approach to general strategy and long-term
risk management is set out in the Corporate Governance Statement (Principle 1)
and the section on Risks and Uncertainties.
The interests of the Company's employees:
Other than the Board, the Company has no employees. It relies on the employees
of Tertiary Minerals plc who are engaged through a Management Services
Agreement, but all of these employees have daily access to the Executive
Chairman and their views are considered in the Board's decision making.
Further details on the Board's employment policies, health and safety policy
and employee engagement are given in the Corporate Governance Statement
(Principle 8).
The need to foster the Company's business relationships with its stakeholders:
The sustainability of the Company's business long-term is dependent on
maintaining strong relationships with its stakeholders. The factors governing
the Company's decision making and the details of stakeholder engagement are
set out in the Corporate Governance Statement (Principles 2, 3, 8 and 10).
Having regard to the impact of the Company's operations on the community and
the environment:
The Company requires a "social licence" to operate sustainably in the mining
industry and so the Board makes careful consideration of any potential impacts
of its activities on the local community and the environment. The Board
strives to maintain good relations with the local communities in which it
operates and with local businesses. For example, in permitting the CS Project
for production the Board has carried out extensive work and consultation with
regulators and the local community representatives to evaluate the benefits
and impacts of its CS Project. Further discussion of these activities and
Board considerations can be found in the Environmental, Social and Governance
("ESG") Statement and in the Corporate Governance Statement (Principle 3).
The desirability of the Company maintaining a reputation for high standards of
business conduct:
The Board recognises that its reputation is key to its long-term success and
depends on maintaining high standards of corporate governance. It has adopted
the QCA Code of Corporate Governance ("QCA Code") and sets out in detail how
it has complied with the 10 key principles of the 2018 QCA Code in the
Corporate Governance Statement. This contains details of various Company
policies designed to maintain high standards of business conduct such as the
Share Dealing Policy; the ESG Policy; the Health and Safety Policy, the Social
Media Policy and the Bribery & Anti-Corruption Policy and Code of Conduct.
In November 2023, the QCA published a revised QCA Code which will apply for
financial years beginning on or after 1 April 2024, with initial disclosures
against the 2023 QCA Code to be published during 2025. Disclosures relating to
the revised principles under the 2023 QCA Code will be made in the Company's
Annual Report for the year ending 30 September 2025 and will also be set out
in the Company's website.
The need to act fairly with Members of the Company:
The Board ensures that it takes decisions in the interests of the members
(shareholders) as a whole and aims to keep shareholders fully informed of
significant developments, ensuring that all shareholders receive Company news
at the same time. The Executive Chairman devotes time to answering genuine
shareholder queries, no individual or group of shareholders is given
preferential treatment. Further information is provided in the Corporate
Governance Statement (Principles 2 and 10).
This Strategic Report was approved by the Board of Directors on 12 February
2025 and signed on its behalf.
Patrick Cheetham
Executive Chairman
Directors' Responsibilities
The directors are responsible for preparing the Strategic Report, the
Directors' Report and the financial statements in accordance with applicable
law and regulations.
Company law requires directors to prepare financial statements for a company
for each financial year. Under that law the directors have elected to prepare
the Group and Company financial statements in accordance with applicable law
and 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 for that period. The directors
are also required to prepare the financial statements in accordance with the
AIM Rules of the London Stock Exchange for companies whose securities are
traded on the AIM market.
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 applicable law and 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 Company and the Group
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.
They are further responsible for ensuring that the Strategic Report and the
Directors' Report and other information included in the Annual Report and
financial statements are prepared in accordance with applicable law in the
United Kingdom.
Website Publication
The maintenance and integrity of the Sunrise Resources plc website is the
responsibility of the directors. Legislation in the United Kingdom governing
the preparation and dissemination of the accounts and the other information
included in annual reports may differ from legislation in other jurisdictions.
Information from the Directors' Report
The directors are pleased to submit their Annual Report and audited financial
statements for the year ended 30 September 2024.
The Strategic Report contains details of the principal activities of the
Company and includes the Operating Review which provides detailed information
on the development of the Group's business during the year and indications of
likely future developments and events that have occurred after the financial
year-end.
Going Concern
In common with many exploration companies, the Company raises finance for its
exploration and appraisal activities in discrete tranches. Further funding is
raised as and when required. When any of the Group's projects move to the
development stage, specific project financing will be required.
The directors prepare annual budgets and cash flow projections that extend
beyond 12 months from the date of this report. Given the Group's cash position
at the year-end of £102,425 (2023: £177,967) these projections include the
estimated proceeds of future fundraising necessary within the next 12 months
to meet the Group's overheads and planned discretionary project expenditures
and to maintain the Company and its subsidiaries as going concerns. Although
the Company has been successful in raising finance in the past, there is no
assurance that it will obtain adequate finance in the future. This represents
a material uncertainty related to events or conditions which may cast
significant doubt on the Group and Company's ability to continue as going
concerns and, therefore, that they may be unable to realise their assets and
discharge their liabilities in the normal course of business. However, the
directors have a reasonable expectation that they will secure additional
funding, when required, to continue meeting corporate overheads and
exploration costs for the foreseeable future and the directors therefore
believe that the going concern basis is appropriate for the preparation of the
financial statements.
Dividend
The directors do not recommend the payment of any dividend.
Financial Instruments and Other Risks
The business of mineral exploration and evaluation has inherent risks. Details
of the Group's financial instruments and risk management objectives and of the
Group's exposure to risk associated with its financial instruments are given
in Note 20 to the financial statements.
Details of risks and uncertainties that affect the Group's business are given
in the Strategic Report.
Directors
The directors holding office in the period were:
Mr P L Cheetham - Chairman of the Board and Chairman of the Nomination
Committee.
Mr R D Murphy - Chair of the Remuneration Committee and a member of the
Nomination and Audit Committees.
Mr J Cole - Chair of the Audit Committee and member of the Nomination and
Remuneration Committees.
Attendance at Board and Committee Meetings
The Board retains control of the Group with day-to-day operational control
delegated to the Executive Chairman. The full Board meets four times a year
and on any other occasions it considers necessary.
Board Nomination Audit Remuneration
Meetings Committee Committee Committee
Director Attended Held Attended Held Attended Held Attended Held
P L Cheetham 16 16 1 1 3 3 1 1
R D Murphy 16 1 3 1
J Cole 16 1 3 1
The directors' shareholdings are shown in Note 17 to the financial statements.
Events After The Balance Sheet Date
Crow Springs Diatomite Project
Following the sale of a group of mining claims in the Crow Springs area of
Nevada, USA, to Dicalite Management Group during the reporting period, the
Company received the remaining half of the purchase price, being US$75,000, on
25 November 2024. For further information about this Project, please refer to
the Operating Review.
Pioche Project
Tolsa USA Inc. advised the Company in late December that it will not proceed
to exercise its option to purchase the Company's Pioche Sepiolite Project in
Nevada, USA.
The option was originally granted on 28 June 2022 and was extended for an
additional 12 months as announced on 27 December 2023. For further information
about this Project, please refer to the Operating Review.
CS Natural Pozzolan Project
On 5 December 2024, SR Minerals Inc. received a partial refund of the bond
deposited with the US Bureau of Land Management in connection with the CS
Natural Pozzolan Project in the amount of US$ $59,452.
On 4 February 2025 SR Minerals Inc. received a payment of US$29,300 from a
cement company being 50% of the costs of providing that company with a bulk
sample of CS Project natural pozzolan.
Shareholders
As at the date of this report the following interests of 3% or more in the
issued share capital of the Company appeared in the share register.
As at 12 February 2025 Number % of share
of shares capital
Interactive Investor Services Nominees Limited SMKTISAS 614,889,742 11.89%
Interactive Investor Services Nominees Limited SMKTNOMS 445,336,569 8.61%
Hargreaves Lansdown (Nominees) Limited 15942 414,861,060 8.02%
Barclays Direct Investing Nominees Limited CLIENT1 334,222,018 6.46%
HSDL Nominees Limited 307,312,462 5.94%
Hargreaves Lansdown (Nominees) Limited VRA 296,379,023 5.73%
Vestra Nominees Limited SIPP 215,204,545 4.16%
Interactive Investor Services Nominees Limited TDWHSIPP 171,135,667 3.31%
HSDL Nominees Limited MAXI 166,344,679 3.22%
Lawshare Nominees Limited SIPP 160,216,372 3.10%
Details of directors' interests in shares and warrants are given in Note 17 to
the Financial Statements.
Disclosure of Audit Information
Each of the directors has confirmed that so far as they are aware, there is no
relevant audit information of which the Company's Auditor is unaware, and that
they have taken all the steps that they ought to have taken as a director in
order to make themselves aware of any relevant audit information and to
establish that the Company's Auditor is aware of that information.
Auditor
A resolution to reappoint Crowe U.K. LLP as Auditor of the Company will be
proposed at the forthcoming Annual General Meeting.
Charitable and Political Donations
During the year, the Group made no charitable or political donations.
Annual General Meeting
The Company's Annual General Meeting will be held on 13 March 2025 at 10.00
a.m.
Conflicts of Interest
The Companies Act 2006 permits directors of public companies to authorise
directors' conflicts and potential conflicts, where appropriate, where the
Articles of Association contain a provision to this effect. The Company's
Articles contain such a provision. Procedures are in place in order to avoid
any conflict of interest between the Company and Tertiary Minerals plc. Under
a Management Service Agreement, Tertiary provides corporate and project
management services to Sunrise.
Approved by the Board on 12 February 2025 and signed on its behalf.
Patrick Cheetham
Executive Chairman
Board of Directors
The Directors and Officers of the Company during the financial year were:
Patrick Cheetham Roger Murphy
Executive Chairman Senior Non-Executive Director
Key Experience: Key Experience:
· Founding director · Career focus in capital raising for mining and oil & gas
companies
· Mining geologist with more than 40 years' experience in mineral
exploration · Former MD, Investment Banking, of Dundee Securities Europe Ltd
· More than 35 years in public company management · Geologist
Appointed: March 2005 Appointed: May 2016
Committee Memberships: Chairman of the Nomination Committee Committee Memberships: Chairman of the Remuneration Committee and Member of
Audit and Nomination Committees
External Commitments: Executive Chairman of Tertiary Minerals plc
External Commitments: Partner and non-executive Director of Madini Minerals,
Executive Director of Zamare Minerals Ltd, Sarn Helen Gold Limited and TREO
Minerals Ltd.
James Cole Rod Venables
Non-Executive Director Company Secretary
Key Experience: Key Experience:
· Chartered Accountant with strong commercial background and track · Qualified company/commercial solicitor
record of success in fundraising, mergers, disposals and acquisitions in
resource sector · Director and Head of Company Secretarial Services at City Group PLC
· Previously Finance Director for the Goal Group Limited. Formerly · Experienced in both Corporate Finance and Corporate Broking
Chief Financial Officer Cominco Resources Ltd, AIM/TSX traded European
Minerals Corporation plc and TSX/OSE traded Crew Gold Corporation.
Appointed: July 2019
Appointed: May 2021
External Commitments: Company Secretary for Tertiary Minerals plc and other
clients of City Group PLC
Committee Memberships: Chairman of the Audit Committee and a Member of the
Remuneration and Nomination Committees
External Commitments: Provides independent financial consultancy to a number
of companies.
Corporate Governance
Chairman's Overview
There is no prescribed corporate governance code for AIM companies and the
London Stock Exchange prefers to give companies the flexibility to choose from
a range of codes which suit their specific stage of development, sector and
size.
The Board considers the corporate governance code published by the Quoted
Companies Alliance ("QCA") in 2018 to be the most suitable code for the
Company for the year ended 30 September 2024. Accordingly, the Company has to
date adopted the principles set out in the QCA Corporate Governance Code (the
"QCA Code") and applies these principles wherever possible, and where
appropriate given its size and available resources. In November 2023, the QCA
published a revised Code which will apply for financial years beginning on or
after 1 April 2024, with initial disclosures against the 2023 QCA Code to be
published during 2025. The 2023 QCA Code will be adopted by the Company for
the year ending 30 September 2025 and disclosures relating to the revised
principles under the 2023 QCA Code will be made in the Company's next Annual
Report and will also be set out in the Company's website.
The Company's Corporate Governance Statement was reviewed by the Board on
12 February 2025 . The Company has set out on its website and in its
Corporate Governance Statement the 10 principles of the QCA Code and details
of the Company's compliance.
Patrick Cheetham, in his capacity as Chairman, has overall responsibility for
the corporate governance of the Company and the Board is responsible for
delivering on our well-defined business strategy having due regard for the
associated risks and opportunities.
The Company's corporate governance arrangements now in place are designed to
deliver a corporate culture that understands and meets shareholder and
stakeholder needs and expectations whilst delivering long-term value for
shareholders.
The Board recognises that its principal activity, mineral exploration and
development, has potential to impact on the local environment and communities
and consequently has adopted an Environmental, Social and Governance ("ESG")
Policy to ensure that the Group's activities have minimal environmental and
social impact. Where appropriate, the Group's contracts with suppliers and
contractors legally bind those suppliers and contractors to do the same. The
Group's activities, carried out in accordance with the ESG Policy, have had
only minimal environmental and social impact at present and this policy is
regularly reviewed. Where appropriate, all work is carried out after prior
consultation with affected parties.
The Board recognises the benefits that social media engagement can have in
helping the Company reach out to shareholders and other stakeholders, but it
also recognises that misuse or abuse of social media can bring the Company
into disrepute. To facilitate the responsible use of social media, the Company
has adopted a Social Media Policy.
The Board has also adopted a Share Dealing Code for dealings in shares of the
Company by directors and employees and a Bribery & Anti-Corruption Policy
and a Code of Conduct applicable to employees, suppliers and contractors.
The Group recognises that the goodwill of its contractors, consultants and
suppliers is important to its business success and seeks to build and maintain
this goodwill through fair dealings. The Group has a prompt payment policy and
seeks to settle all agreed liabilities within the terms agreed with suppliers.
The Board recognises it has a responsibility to provide strategic leadership
and direction in the development of the Group's health and safety strategy in
order to protect all of its employees and other stakeholders. The Company has
developed a Health and Safety Policy to clearly define roles and
responsibilities and in order to identify and manage risk.
Your Board currently comprises three directors of which two are non-executive
and considered by the Board to be independent. We believe that this balance
provides an appropriate level of independent oversight. The Board has the
ability to seek independent advice although none was deemed necessary in the
year under review. The Board is aware of the need to refresh its membership
from time to time and to match its skill set to those required for the
development of its mineral interests and will consider appointing additional
independent non-executive directors in the future.
Patrick Cheetham
Executive Chairman
Environmental, Social and Governance Statement
Sunrise Resources plc and its subsidiaries ("the Company") practice
responsible exploration as reflected in this Environmental, Social and
Governance ("ESG") policy statement and as demonstrated by our actions. By
doing so we reduce project risk, avoid adverse environmental and social
impacts, optimising benefits for all stakeholders while adding value to our
projects.
Our business associates, consultants and contractors ("Associated Parties")
perform much of our primary activities at our projects and therefore we
require that all Associated Parties working on our behalf or for our
subsidiaries accept and adhere to the principles set out in this policy. We
encourage input from those with local knowledge and we review this policy on a
regular basis.
Our ESG policy is guided by the Prospectors & Developers Association of
Canada's (PDAC) framework for responsible exploration (rebranded in 2024 from
e3 Plus to Driving Responsible Exploration, or DRE) which encourages mineral
exploration companies to support and improve social, environmental and health
and safety performance across all exploration activities around the world.
Adopting Responsible Governance and Management
The Company is committed to environmentally and socially responsible mineral
exploration and has developed and implemented policies and procedures for
corporate governance and ethics. We ensure that all staff and key Associated
Parties are familiar with these and have appropriate levels of knowledge of
these policies and procedures.
The Company employs persons and engages contractors with the required
experience and qualifications relevant to their specific tasks and, where
necessary, seeks the advice of specialists to improve the understanding and
management of social, environmental, human rights and security, health and
safety, and in the application of traditional knowledge.
The Company's Corporate Governance Statement, its Bribery &
Anti-Corruption Policy and its Code of Conduct can be viewed on our website
here: https://www.sunriseresourcesplc.com/corporate-governance
(https://www.sunriseresourcesplc.com/corporate-governance) .
Applying Ethical Business Practices
As well as our shareholders and staff, our stakeholders include local
communities and local leadership, local, regional and national government and
regulatory authorities, suppliers, contractors and consultants, our local
business partners and other interested parties. Our corporate culture and
policies require honesty, integrity, transparency and accountability in all
aspects of our work and when interacting with all stakeholders.
We encourage our contractors, consultants and local partners to be aware of
our Bribery & Anti-Corruption Policy and the Company's Code of Conduct.
The Company takes all necessary steps to ensure that activities in the field
minimise or mitigate any adverse impacts on both the environment and on local
communities.
Commitment to Project Due Diligence and Risk Assessment
We make sure we are informed of the laws, regulations, treaties and standards
that are applicable with respect to our activities. We ensure that Associated
Parties are informed and prepared before going into the field in order to
minimise the risk of miscommunication, unnecessary costs and conflict, and to
understand the potential for creating opportunities with local communities
where possible.
Engaging Host Communities and Other Affected and Interested Parties
The Company is committed to engaging positively with local communities,
regulatory authorities, suppliers and other stakeholders in its project
locations, and encourages feedback through this engagement. Through this
process, the Company develops and fosters the relationships on which our
business relies for success.
Respecting Human Rights
The Company's exploration activities are carried out in line with applicable
laws on human rights in its home jurisdiction and those of the countries in
which it works. The Company does not engage in activities that have adverse
human rights impacts.
Protecting the Environment
We are committed to ensuring that environmental standards are met or exceeded
in the course of our exploration activities. Applicable laws and local
guidelines in all project jurisdictions are followed diligently and
exploration programmes are only carried out once relevant permits and
approvals have been secured from the appropriate regulatory bodies.
In Nevada, USA, most of our exploration is carried out on Federally owned land
administered by the Bureau of Land Management ("BLM") which requires the
submission of financial bonds for reclamation of exploration activities and
which holds the Company to account. Provisions are made in the financial
statements for reclamation costs in accordance with calculations set by the
BLM. When operating on private lands the Company applies the same rigorous
standards for reclamation.
In Australia, field exploration activity requires prior approval from the
Department of Mines, Industry Regulation and Safety which imposes
environmental reclamation obligations on any such approvals.
Where our activities create ground disturbance, we ensure that full
rehabilitation is carried out in accordance with regulations and we take care
to minimise the impact of our activities on local flora and fauna, choosing
less impactful exploration methods where possible.
Safeguarding the Health and Safety of Workers and the Local Population
The Company's activities are carried out in accordance with its Health and
Safety Policy which adheres to all applicable laws. It ensures that its
Associated Parties are made aware of and follow these policies where relevant.
Corporate Governance Statement
The Company has set out on its website, and below, the ten principles of the
2018 QCA Code ("the Code") with an explanation of how the Company applies each
principle and/or the reasons for any aspect of non-compliance. The QCA Code
was updated in 2023 and the revised QCA Code is designed to apply to companies
whose financial years start on or after 1 April 2024. Accordingly the Board
proposes to adopt the 2023 QCA Code in the next reporting period, being the
year ending 30 September 2025.
The Board of Sunrise Resources plc comprises three members. Nevertheless,
there are Audit, Remuneration and Nomination Committees to ensure proper
governance in compliance with the Code
Principle One: Establish a strategy and business model which promote long-term
value for shareholders.
The Company has a clearly defined strategy and business model that has been
adopted by the Board and is set out in the Strategic Report. Details of the
challenges to the execution of the Company's strategy and business model and
how those will be addressed can be found in Risks and Uncertainties in the
Strategic Report.
Principle Two: Seek to understand and meet shareholder needs and expectations.
The Board is committed to maintaining good communication with its shareholders
and investors. The Chairman and members of the Board from time to time meet
with shareholders and investors directly or through arrangements with the
Company's brokers to understand their investment requirements and expectations
and to address their enquiries and concerns.
All shareholders are encouraged to attend the Company's Annual General
Meetings where they can meet and directly communicate with the Board. After
the close of business at the Annual General Meeting, the Chairman makes an
up-to-date corporate presentation and opens the floor to questions from
shareholders.
Shareholders are also welcome to contact the Company via email at
info@sunriseresourcesplc.com with any specific queries.
The Company also provides regulatory, financial and business news updates
through the Regulatory News Service (RNS) and various media channels such as
X, formerly Twitter. Shareholders also have access to information through the
Company's website, www.sunriseresourcesplc.com, which is updated on a regular
basis and which includes the latest corporate presentation on the Group.
Contact details are also provided on the website.
Principle Three: Take into account wider stakeholder and social
responsibilities and their implications for long-term success.
The Board takes regular account of the significance of social, environmental
and ethical matters affecting the business of the Group. The Board has adopted
an Environmental, Social and Governance ("ESG") Policy, which can be found on
the Company website and an ESG Statement can be found in this Annual Report.
The Company engages positively with local communities, regulatory authorities,
suppliers and other stakeholders in its project locations and encourages
feedback through this engagement. Through this process, the Company identifies
the key resources and fosters the relationships on which the business relies.
Principle Four: Embed effective risk management, considering both
opportunities and threats, throughout the organisation.
The Board regularly reviews the risks to which the Group is exposed and
ensures through its meetings and regular reporting that these risks are
minimised as far as possible whilst recognising that its business
opportunities carry an inherently high level of risk. The principal risks and
uncertainties facing the Group at this stage in its development and in the
foreseeable future are detailed in Risks and Uncertainties in the Strategic
Report, together with risk mitigation strategies employed by the Board.
Principle Five: Maintain the board as a well-functioning, balanced team led by
the chair.
The Board's role is to agree the Group's long-term direction and strategy and
monitor achievement of its business objectives. The Board meets formally four
times a year for these purposes and holds additional meetings when necessary
to transact other business. The Board receives regular and timely reports for
consideration on all significant strategic, operational and financial matters.
Relevant information for consideration by the Board is circulated in advance
of its meetings.
Further details on the Board's meetings are provided in the Directors' Report.
The Board is supported by the Audit, Remuneration and Nomination Committees.
The Board currently consists of the Executive Chairman (Patrick Cheetham), and
two non-executive directors (Roger Murphy and James Cole). The current Board's
preference is that independent non-executive directors comprise the majority
of Board members. Patrick Cheetham is currently the Chairman and Chief
Executive Officer. Patrick Cheetham has a service contract as Chairman of the
Company and his services as Chief Executive Officer are provided to the
Company, at cost, through a Management Services Agreement with Tertiary
Minerals plc ("Tertiary"), in which he is a shareholder and where he is also
employed as Chairman. In 2024, Patrick Cheetham dedicated over 40% of his
working time to the Company. The combined role of Chairman and Chief Executive
Officer results in cost savings and is considered acceptable whilst there is a
majority of independent directors on the Board and having regard to the fact
that the Company is not yet revenue generating.
The non-executive directors have committed the time necessary to fulfil their
roles during the year. The attendance record of the directors at Board and
Board Committee meetings are detailed in the Directors' Report.
The current non-executive directors are considered independent of management
and free from any business or other relationship which could materially
interfere with the exercise of their independent judgement.
Principle Six: Ensure that between them the directors have the necessary up to
date experience, skills and capabilities.
The Board considers the current balance of sector, financial and public market
skills and experience of its directors are relevant to the Company's business
and are appropriate for the current size and stage of development of the
Company and the Board considers that it has the skills and experience
necessary to execute the Company's strategy and business plan and discharge
its duties effectively.
The directors maintain their skills through membership of various professional
bodies, attendance at mining conferences and through their various external
appointments.
All directors have access to the advice and services of the Company Secretary
who is responsible for ensuring that Board procedures and applicable rules and
regulations are observed. All directors are able to take independent
professional advice, if required, in relation to their duties and at the
Company's expense.
Principle Seven: Evaluate board performance based on clear and relevant
objectives, seeking continuous improvement.
The ultimate measure of the effectiveness of the Board is the Company's
progress against the long-term strategy and aims of the business. This
progress is reviewed in Board meetings held formally at least four times a
year. The Executive Chairman's performance is regularly reviewed by the rest
of the Board.
The Nomination Committee, currently consisting of the Executive Chairman and
the two non-executive directors, meets once a year to lead the formal process
of rigorous and transparent procedures for Board appointments. During this
meeting the Nomination Committee reviews the structure, size and composition
of the Board; succession planning; leadership; key strategic and commercial
issues; conflicts of interest; time required from non-executive directors to
execute their duties effectively; the overall effectiveness of the Board; and
the Committee's own terms of reference.
Under the Articles of Association, new directors appointed to the Board must
stand for election at the first Annual General Meeting of the Company
following their appointment and existing directors retire by rotation
annually and may offer themselves for re-election.
Principle Eight: Promote a corporate culture that is based on ethical values
and behaviours.
The Board recognises and strives to promote a corporate culture based on
strong ethical and moral values. The Group is currently managed via a service
agreement with Tertiary. It has no employees, outside the non-executive
directors, but encourages Tertiary's employees to understand all aspects of
the Group's business and Tertiary seeks to remunerate its employees fairly,
being flexible where practicable. In future, the Group will give full and fair
consideration to applications for employment received regardless of age,
gender, colour, ethnicity, disability, nationality, religious beliefs,
transgender status or sexual orientation. The Board takes account of
Tertiary's employees' interests when making decisions, and suggestions from
those employees aimed at improving the Group's performance are welcomed.
The corporate culture of the Company is promoted to Tertiary's employees,
suppliers and contractors and is underpinned by the implementation and regular
review, enforcement and documentation of various policies and codes: the
Health and Safety Policy; the Environmental, Social and Governance ("ESG")
Policy; the Share Dealing Policy; the Bribery & Anti-Corruption Policy and
the Company's Code of Conduct; the Privacy and Cookies Policy and the Social
Media Policy. These policies and codes enable the Board to determine that
ethical values are recognised and respected.
The Board recognises that its principal activity, mineral exploration and
development, has potential to impact on local environments and communities,
and as such an ESG Policy was developed with this in mind and this replaces
the Company's previous policy and ensures that, wherever they take place, the
Group's activities have minimal environmental and social impact. Where
appropriate the Group's contracts with suppliers and contractors legally bind
those suppliers and contractors to do the same. The Group's activities carried
out in accordance with the ESG Policy have had only minimal environmental and
social impact and this policy is regularly reviewed. Where appropriate, all
work is carried out after prior consultation with affected parties.
Principle Nine: Maintain governance structures and processes that are fit for
purpose and support good decision-making by the Board.
The Board has overall responsibility for all aspects of the business. The
Chairman is responsible for overseeing the running of the Board, ensuring that
no individual or group dominates the Board's decision-making, and that the
non-executive directors are properly briefed on all operational and financial
matters. The Chairman has overall responsibility for corporate governance
matters in the Group and chairs the Nomination Committee. The Chairman has the
responsibility for implementing the strategy of the Board and managing the
day-to-day business activities of the Group. The Company Secretary is
responsible for ensuring that Board procedures are followed, and applicable
rules and regulations are complied with. Key operational and financial
decisions are reserved for the Board through quarterly project reviews, annual
budgets, and quarterly budget and cash-flow forecasts and on an ad hoc basis
where required.
The two non-executive directors are responsible for bringing independent and
objective judgment to Board decisions. The Board has established Audit,
Remuneration and Nomination Committees with formally delegated duties and
responsibilities as set out in their respective Terms of Reference. James Cole
currently chairs the Audit Committee, Roger Murphy chairs the Remuneration
Committee and Patrick Cheetham chairs the Nomination Committee.
This Corporate Governance statement will be reviewed at least annually to
ensure that the Company's corporate governance framework evolves in line with
the Company's strategy and business plan.
Principle Ten: Communicate how the Company is governed and is performing by
maintaining a dialogue with shareholders and other relevant stakeholders.
The Company regularly communicates with, and encourages feedback from, its
shareholders who are its key stakeholder group. The Company's website is
regularly updated and users, including all stakeholders, can register to be
alerted via email when material announcements are made. The Company's contact
details are on the website should stakeholders wish to make enquiries of
management.
The Group's financial reports for at least the past five years can be found
here: https://www.sunriseresourcesplc.com/financial-reports
(https://www.sunriseresourcesplc.com/financial-reports) and the Company's
website contains past Notices of Annual General Meetings.
The results of voting on all resolutions in general meetings are posted to the
Company's website, including any actions to be taken as a result of
resolutions for which votes against have been received from at least 20 per
cent of independent votes.
Audit Committee Report
The Audit Committee is a sub-committee of the Board, comprised of the
independent non-executive directors and assists the Board in meeting
responsibilities in respect of external financial reporting and internal
controls. The Audit Committee also keeps under review the scope and results of
the audit. It also considers the cost-effectiveness, independence and
objectivity of the auditors taking account of any non-audit services provided
by them. James Cole is Chair of the Audit Committee.
The specific objectives of the Committee are to:
a) maintain adequate quality and effective scope of the
external audit of the Group including its branches where applicable and review
the independence and objectivity of the auditors.
b) ensure that the Board of Directors has adequate
knowledge of issues discussed with its external auditor.
c) ensure the financial information and reports issued
by the Company to AIM, shareholders and other recipients are accurate and
contain proper disclosure at all times.
d) maintain the integrity of the Group's administrative
operating and accounting controls and internal control principles.
e) ensure appropriate accounting policies are adhered to
by the Group.
The Committee has unlimited access to the external Auditor, to senior
management of the Group and to any external party deemed necessary for the
proper discharge of its duties. The Committee may consult independent experts
where it considers necessary to perform its duties.
The Audit Committee reviews the financial controls of the Company on a regular
basis and is satisfied that the Group's financial controls and reporting
procedures are robust and sufficient to ordinarily prevent fraud and ensure
that senior management, the Committee and the Board are fully aware of the
Company's financial position at all times.
The Audit Committee met three times in the last financial year, on 23 January
2024, 30 May 2024 and 9 August 2024. Significant reporting issues considered
during the year included the following:
1. Impairments
The Committee has reviewed the carrying values of the Group projects as at 30
September 2024, and recoverability of loans from the Parent Company to
subsidiary undertakings and carried out impairment reviews. The project
carrying values are assessed against the IFRS 6 criteria set out in Note 1(n).
Loans to subsidiary undertakings are assessed for impairment under IAS 36.
As a result of this, it was judged that the Bay State Project would be
impaired and that the Sunrise Minerals Australia Pty Ltd intercompany loans
should also be impaired.
2. Going Concern
The Committee also considered the Going Concern basis on which the accounts
have been prepared (see Note 1(b)). The directors are satisfied that the Going
Concern basis is appropriate for the preparation of the financial statements.
James Cole
Chair - Audit Committee
12 February 2025
Remuneration Committee Report
The Remuneration Committee is a sub-committee of the Board and comprises the
independent non-executive directors. Roger Murphy is Chair of the Remuneration
Committee.
The primary objective of the Committee is to review the performance of the
executive directors and review the basis of their service agreements and make
recommendations to the Board regarding the scale and structure of their
remuneration.
However, the Company does not currently remunerate any of the directors other
than in their capacity as directors. Whilst the Chairman of the Board, Patrick
Cheetham, does have an executive role, his technical and managerial services
are provided under a Management Service Agreement with Tertiary Minerals plc
and his remuneration is fixed by Tertiary Minerals plc. Nonetheless, it is the
role of the Remuneration Committee to ensure that the executive director is
appropriately incentivised and rewarded for his services to the Company and
this is considered as part of the Committee's review of any Long-Term
Incentive Plan.
The Remuneration Committee met once during the financial year under review, on
14 May 2024, to review the Terms of Reference for the Committee and to
consider their continuing suitability.
Roger Murphy
Chair - Remuneration Committee
12 February 2025
Nomination Committee Report
The Nomination Committee comprises the Chairman and the independent
non-executive directors. Patrick Cheetham is Chair of the Nomination
Committee.
The primary objective of the Nomination Committee is to lead the formal
process of reviewing and making recommendations as to Board appointments and
other Board changes and to make appropriate recommendations to the Board.
The Committee is required, amongst other things, to:
a) Review the structure, size and composition (including
the skills, knowledge, experience and diversity) of the Board and make
recommendations to the Board with regard to Board appointments and any Board
changes.
b) Give full consideration to succession planning for
directors and other senior executives in the course of its work, taking into
account the challenges and opportunities facing the Company, and the skills
and expertise needed on the Board in the future.
c) Keep under review the leadership needs of the
organisation to compete effectively in the marketplace.
d) Review annually the time required from non-executive
directors and non-executive directors. Performance evaluation should be used
to assess whether the executive directors and non-executive directors are
spending enough time in fulfilling their duties.
e) Arrange periodic reviews of the Committee's own
performance and, at least annually, review its constitution and terms of
reference to ensure it is operating at maximum effectiveness and recommend any
changes it considers necessary to the Board for approval.
f) Ensure that prior to the appointment of a director,
the proposed appointee should be required to disclose any other business
interests that may result in a conflict of interest and be required to report
any future business interests that may result in a conflict of interest.
The Committee carries out its duties for the Parent Company, major subsidiary
undertakings and the Group as a whole and met once during the period under
review, on 22 February 2024, to review the Terms of Reference for the
Committee and to consider their continuing suitability.
The Committee is satisfied that the current Board has a depth of experience
and level, and range of skills appropriate to the Company at this stage in its
development. It is, however, recognised that the Company is likely to need
additional expertise as it moves forward into commercial production and so the
composition of the Board will be kept under careful review to ensure that the
Board can deliver long-term growth in shareholder value.
Patrick Cheetham
Chair - Nomination Committee
12 February 2025
Publication of Statutory Accounts
The financial information set out in this announcement does not constitute the
Company's Annual Accounts for the period ended 30 September 2024 or 2023. The
financial information for 2023 is derived from the Statutory Accounts for
2023. Full audited accounts in respect of that financial period have been
delivered to the Registrar of Companies. The Statutory Accounts for 2024 will
be delivered to the Registrar of Companies following the Company's Annual
General Meeting. The Auditors have reported on the 2024 and 2023 accounts.
Neither set of accounts contain a statement under section 498(2) of (3) the
Companies Act 2006 and both received an unqualified audit opinion. However,
there was an emphasis of matter in relation to a requirement that the Company
raise funds in the future to continue as a going concern.
Availability of Financial Statements
The Annual Report containing the full financial statements for the year to
30 September 2024 will be uploaded to the Shareholders Documents section of
the Company's website on or around 14 February 2025:
https://www.sunriseresourcesplc.com/shareholder-documents.
Consolidated Income Statement
for the year ended 30 September 2024
Notes 2024 2023
£ £
Revenue 2 112,050 -
Cost of sales 3 (41,146) -
Gross profit 70,904 -
Other income 23 78,435 36,881
Pre-licence exploration costs 304 (3,753)
Impairment of exploration expenditure 10 (422,135) -
Administration costs (386,766) (425,419)
Operating loss (659,258) (392,291)
Interest receivable 452 1,000
Loss before taxation 4 (658,806) (391,291)
Tax on loss 8 - -
Loss for the year attributable to equity holders of the parent (658,806) (391,291)
Loss per share - basic and diluted (pence) 7 (0.015) (0.010)
All amounts relate to continuing activities.
Consolidated Statement of Comprehensive Income
for the year ended 30 September 2024
2024 2023
£ £
Loss for the year (658,806) (391,291)
Items that could be reclassified subsequently to the income statement:
Foreign exchange translation differences on foreign currency net investments (201,584) (215,389)
in subsidiaries
Items that will not be reclassified to the income statement:
Changes in the fair value of equity investments (1,954) (7,466)
(203,538) (222,855)
Total comprehensive loss for the year attributable to equity holders of the (862,344) (614,146)
parent
Consolidated and Company Statements of Financial Position
at 30 September 2024
Company Registration Number: 05363956
Notes Group Company Group Company (restated*)
2024 2024 2023 30 September 2023
£ £ £ £
Non-current assets
Intangible assets 10 1,832,826 - 2,409,311 -
Right of use assets 18 - - 5,536 -
Investment in subsidiaries 9 - 2,745,496 - 2,992,223
Other investments 9 7,930 5,719 11,192 5,625
1,840,756 2,751,215 2,426,039 2,997,848
Current assets
Receivables 12 179,813 22,926 145,459 30,369
Cash and cash equivalents 13 102,425 83,265 177,967 160,711
282,238 106,191 323,426 191,080
Current liabilities
Trade and other payables 14 (127,887) (101,935) (108,773) (95,104)
Lease liabilities 18 - - (2,644) -
Convertible Loan Note 24 (195,000) (195,000) (300,000) (300,000)
(322,887) (296,935) (411,417) (395,104)
Net current (liabilities)/assets (40,649) (190,744) (87,991) (204,024)
Non current liabilities
Provisions 21 (24,485) - (29,525) -
(24,485) - (29,525) -
Net assets 1,775,622 2,560,471 2,308,523 2,793,824
Equity
Called up share capital 15 49,450 49,450 4,095,052 4,095,052
Share premium account 5,995,112 5,995,112 5,680,316 5,680,316
Capital Redemption Reserve 4,054,102 4,054,102 - -
Share warrant reserve 43,757 43,757 42,815 42,815
Fair value reserve 720 11,968 2,674 11,874
Foreign currency reserve (12,870) 1,321 188,714 1,321
Accumulated losses (8,354,649) (7,595,239) (7,701,048) (7,037,554)
Equity attributable to owners of the parent 1,775,622 2,560,471 2,308,523 2,973,824
*See Note 27 for details regarding the restatement as a result of errors,
together with a statement of financial position as at 1 October 2022.
The Company reported a loss for the year ended 30 September 2024 of £562,890
(2023 (restated): £703,425).
These financial statements were approved and authorised for issue by the Board
on 12 February 2025 and were signed on its behalf.
P L
Cheetham
J Cole
Executive
Chairman
Director
Consolidated Statement of Changes in Equity
Group Share Share Share Capital Fair Foreign Accumulated Total
capital premium warrant redemption value currency losses £
£ account reserve reserve reserve reserve £
£ £ £ £ £
At 30 September 2022 3,833,559 5,680,316 40,101 - 10,140 404,103 (7,312,362) 2,655,857
Loss for the year - - - - - - (391,291) (391,291)
Change in fair value - - - - (7,466) - - (7,466)
Exchange differences - - - - - (215,389) - (215,389)
Total comprehensive loss for the year - - - - (7,466) (215,389) (391,291) (614,146)
Share issue 261,493 - - - - - - 261,493
Share-based payments expense - - 5,319 - - - - 5,319
Transfer of expired warrants - - (2,605) - - - 2,605 -
At 30 September 2023 4,095,052 5,680,316 42,815 - 2,674 188,714 (7,701,048) 2,308,523
Loss for the year - - - - - - (658,806) (658,806)
Change in fair value - - - - (1,954) - - (1,954)
Exchange differences - - - - - (201,584) - (201,584)
Total comprehensive loss for the year - - - - (1,954) (201,584) (658,806) (862,344)
Share issue 8,500 314,796 - - - - - 323,296
Capital restructure (4,054,102) - - - - - - (4,054,102)
Capital redemption reserve - - - 4,054,102 - - - 4,054,102
Share-based payments expense - - 6,147 - - - - 6,147
Transfer of expired warrants - - (5,205) - - - 5,205 -
At 30 September 2024 49,450 5,995,112 43,757 4,054,102 720 (12,870) (8,354,649) 1,775,622
Company Statement of Changes in Equity
Company Share Share Share Capital Fair Foreign Accumulated Total
capital premium warrant redemption value currency losses £
£ account reserve reserve reserve reserve £
£ £ £ £ £
At 30 September 2022 (restated) 3,833,559 5,680,316 40,101 - 17,500 1,321 (6,336,734) 3,236,063
Loss for the year (restated) - - - - - - (703,425) (703,425)
Change in fair value - - - - (5,626) - - (5,626)
Total comprehensive loss for the year (restated) - - - - (5,626) - (703,425) (709,051)
Share issue 261,493 - - - - - - 261,493
Share-based payments expense - - 5,319 - - - - 5,319
Transfer of expired warrants - - (2,605) - - - 2,605 -
At 30 September 2023 (restated) 4,095,052 5,680,316 42,815 - 11,874 1,321 (7,037,554) 2,793,824
Loss for the year - - - - - - (562,890) (562,890)
Change in fair value - - - - 94 - - 94
Total comprehensive loss for the year - - - - 94 - (562,890) (562,796)
Share issue 8,500 314,796 - - - - - 323,296
Capital restructure (4,054,102) - - - - - - (4,054,102)
Capital redemption reserve - - - 4,054,102 - - - 4,054,102
Share-based payments expense - - 6,147 - - - - 6,147
Transfer of expired warrants - - (5,205) - - - 5,205 -
At 30 September 2024 49,450 5,995,112 43,757 4,054,102 11,968 1,321 (7,595,239) 2,560,471
Consolidated and Company Statements of Cash Flows
for the year ended 30 September 2024
Notes Group Company Group Company
2024 2024 2023 (restated*)
£ £ £ 2023
£
Operating activity
Operating (loss)/profit before interest (659,258) (563,342) (392,291) (704,425)
Depreciation/interest charge 18,21 5,046 - 4,944 -
Share-based payment charge 6,147 6,147 5,319 5,319
Deferred consideration from sale of exploration assets 56,025 - - -
Shares issued in lieu of net wages 12,363 12,363 15,520 15,520
Fees paid by issues of shares (redemption fees) - - 42,857 42,857
Expenditures settled by issues of shares 17,015 17,015 - -
Impairment charge - deferred exploration expenditure 10 422,135 - - -
Reclamation liability 21 5,039 - - -
Increase/(decrease) in provision for impairment of loans to subsidiaries 9 - 15,363 - -
(Increase)/decrease in receivables 12 (34,355) 7,442 (21,966) (18,795)
Increase/(decrease) in trade and other payables 14 19,115 6,832 3,837 5,043
Foreign exchange gain/loss - 223,964 - 344,543
Net cash outflow from operating activity (150,728) (274,216) (341,780) (309,938)
Investing activity
Interest received 452 452 1,000 31,892
Exploration expenditure 10 (102,580) - (124,761) -
(Disbursements to)/receipts from subsidiaries - 7,400 - (144,700)
Net cash outflow from investing activity (102,128) 7,852 (123,761) (112,808)
Financing activity
Issue of share capital (net of expenses) 188,917 188,917 118,636 118,636
Lease payments 18 (2,412) - (2,623) -
Convertible loan note - - 400,000 400,000
Net cash inflow from financing activity 186,505 188,917 516,013 518,636
Net increase/(decrease) in the year (66,351) (77,447) 50,472 95,890
Cash and cash equivalents at start of year 177,967 160,711 96,801 74,319
Exchange differences (9,191) 1 30,694 (9,498)
Cash and cash equivalents at 30 September 13 102,425 83,265 177,967 160,711
* See Note 27 for details regarding the restatement as a result of errors,
together with a statement of financial position as at 1 October 2022.
Notes to the Financial Statements
for the year ended 30 September 2024
Background
Sunrise Resources plc (the "Company") is a public company incorporated and
domiciled in England. Its shares are traded on the AIM Market of the London
Stock Exchange EPIC: SRES.
The Company is a holding company (together, "the Group") for one company
incorporated in Australia, and two companies incorporated in Nevada, in the
United States of America. The Group's financial statements are presented in
Pounds Sterling (£) which is also the functional currency of the Company.
The following accounting policies have been applied consistently in dealing
with items which are considered material in relation to the Group's financial
statements.
1. Material accounting policies
(a) Basis of preparation
The Group and Company financial statements have been prepared on the basis of
the recognition and measurement requirements of applicable law and UK adopted
International Accounting Standards.
(b) Going concern
In common with many exploration companies, the Company raises finance for its
exploration and appraisal activities in discrete tranches. Further funding is
raised as and when required. When any of the Group's projects move to the
development stage, specific project financing will be required.
The directors prepare annual budgets and cash flow projections that extend
beyond 12 months from the date of this report. Given the Group's cash position
at year end (£102,425), these projections include the proceeds of future
fundraising necessary within the next 12 months to meet the Company's and
Group's overheads and planned discretionary project expenditures and to
maintain the Company and Group as going concerns. Although the Company has
been successful in raising finance in the past, there is no assurance that it
will obtain adequate finance in the future. This represents a material
uncertainty related to events or conditions which may cast significant doubt
on the Group's and Company's ability to continue as going concerns and,
therefore, that they may be unable to realise their assets and discharge their
liabilities in the normal course of business. However, the directors have a
reasonable expectation that they will secure additional funding when required
to continue meeting corporate overheads and exploration costs for the
foreseeable future and therefore the directors believe that the going concern
basis is appropriate for the preparation of the financial statements. In
considering the longer-term financial outlook of the Group, the continued
viability of the most significant exploration and evaluation assets as set out
in Note 1(n) is critical to this assessment.
(c) Basis of consolidation
Investments, including long-term loans, in the subsidiaries are valued at the
lower of cost or recoverable amount, with an ongoing review for impairment.
The Group's financial statements consolidate the financial statements of the
Company and its subsidiary undertakings using the acquisition method and
eliminate intercompany balances and transactions.
In accordance with section 408 of the Companies Act 2006, the Company is
exempt from the requirement to present its own statement of comprehensive
income. The amount of the loss for the financial year recorded within the
financial statements of the Company is £562,890 (2023 (restated): £703,425).
The Group's financial statements consolidate the financial statements of
Sunrise Resources plc and its controlled entities made up to 30 September each
year. The prior year comparatives are for the year ended 30 September 2023.
Where the Group controls an entity it is classified as a subsidiary.
Generally, there is a presumption that a majority of voting rights results in
control. Control is also achieved where the Group has power over the entity,
is exposed or has rights to variable returns from its involvement with the
entity and has the ability to affect those returns through its power over the
entity. The Group re-assess whether or not it controls an entity if facts
and circumstances indicate that there are changes to one for more of these
elements of control.
Subsidiaries acquired during the reporting period are incorporated under the
acquisition method of accounting and their results consolidated from the date
of acquisition. They are deconsolidated from the date that the Group ceases to
control the subsidiary.
The consolidated financial statements present the results of the Group as if
they formed a single entity. All intra-group transactions and balances
between Group companies are eliminated in full.
The Group's subsidiaries during the reporting period are set out in Note 9.
(d) Intangible assets
Exploration and evaluation
Accumulated exploration and evaluation costs incurred in relation to separate
areas of interest (which may comprise more than one exploration licence or
exploration licence applications) are capitalised and carried forward where:
(i) such costs are expected to be recouped through
successful exploration and development of the area, or alternatively by its
sale; or
(ii) exploration and/or evaluation activities in the area
have not yet reached a stage which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves, and active and
significant operations in, or in relation to the areas are continuing.
A biannual review is carried out by the directors to consider whether there
are any indications of impairment in capitalised exploration and development
costs. Full impairment reviews were carried out in order to assess the
carrying values of each project as at 31 March 2024 and 30 September 2024.
This involved consideration of changes in circumstances and evidence including
exploration results, changes in tenure of mineral rights, economic
circumstances such as market prices, opportunities for realisation such as
sale or joint ventures and viability, comparing anticipated future costs with
expected recoverable value. For each project, based upon the relevant
considerations, the directors formed a view regarding the recoverability of
capitalised expenditure and continued compliance with the IFRS 6 criteria for
recognition and deferral.
Where an indication of impairment is identified, the relevant value is written
off to the income statement in the period for which the impairment was
identified. An impairment of exploration and development costs may be
subsequently reversed in later periods should conditions allow.
Accumulated costs, where the Group does not yet have an exclusive exploration
licence and in respect of areas of interest which have been abandoned, are
written off to the income statement in the year in which the pre-licence
expense was incurred or in which the area was abandoned.
Development
Exploration, evaluation and development costs are carried at the lower of cost
and expected net recoverable amount. On reaching a mining development
decision, for example, the commitment of capital to mine development,
exploration and evaluation costs are reclassified as development costs and all
development costs on a specific area of interest will be amortised over the
useful economic life of the projects, once they become income generating and
the costs can be recouped.
(e) Trade and other receivables and payables
Trade and other receivables and payables are measured at initial recognition
at fair value and subsequently measured at amortised cost.
(f) Cash and cash equivalents
Cash and cash equivalents consist of cash at bank and in hand and short-term
highly liquid deposits with a maturity of three month or less, that are held
for the purpose of meeting short-term cash commitments and are readily
convertible to a known amount of cash and subject to an insignificant risk of
changes in value. .
(g) Leases
IFRS 16 requires the recognition of lease commitments as right of use assets
and the recognition of a corresponding liability. Lease costs are recognised
in the income statement in the form of depreciation of the right of use asset
over the lease term and interest charges representing the unwind of the
discount on the lease liability.
Short term leases, which fall outside the IFRS 16 requirements, having a
duration of 12 months or less, are charged to the income statement on straight
line basis.
(h) Deferred taxation
Deferred taxation, if applicable, is provided in full in respect of taxation
deferred by temporary differences between the treatment of certain items for
taxation and accounting purposes.
Deferred tax assets are recognised to the extent that they are regarded as
recoverable.
(i) Foreign currencies
The Group's consolidated financial statements are presented in Pounds Sterling
(£), being the functional currency of the Company, and the currency of the
primary economic environment in which the Company operates. Monetary assets
and liabilities denominated in foreign currencies are translated at the rate
of exchange ruling at the balance sheet date.
For consolidation purposes, the net investment in foreign operations and the
assets and liabilities of overseas subsidiaries, associated undertakings and
joint arrangements, that have a functional currency different from the Group's
presentation currency, are translated at the closing exchange rates. Income
statements of overseas subsidiaries, that have a functional currency different
from the Group's presentation currency, are translated at exchange rates at
the date of transaction. Exchange differences arising on opening reserves are
taken to the foreign currency reserve in equity.
(j) Share warrants and share-based payments
The Company issues warrants to employees (including directors) and third
parties. The fair value of the warrants is recognised as a charge measured at
fair value on the date of grant and determined in accordance with IFRS 9,
adopting the Black-Scholes-Merton model. The fair value is recognised on a
straight-line basis over the vesting period, with a corresponding adjustment
to equity, based on the management's estimate of shares that will eventually
vest. The expected life of the warrants is adjusted, based on management's
best estimates, for the effects of non-transferability, exercise restrictions
and behavioural considerations. The details are shown in Note 16.
The Company also issues shares in order to settle certain liabilities,
including payment of fees to directors. The fair value of shares issued is
based on the closing mid-market price of the shares traded on the AIM market
on the day prior to the date of settlement and it is expensed on the date of
settlement with a corresponding increase in equity.
(k) Financial assets designated at fair value through OCI
Upon initial recognition, the Group can elect to classify irrevocably its
equity investments as equity instruments designated at fair value through OCI
when they meet the definition of equity under IAS 32 Financial Instruments:
Presentation and are not held for trading. The classification is determined on
an instrument-by-instrument basis.
Gains and losses on these financial assets are never recycled to profit or
loss. Dividends are recognised as other income in the statement of profit or
loss when the right of payment has been established, except when the Group
benefits from such proceeds as a recovery of part of the cost of the financial
asset, in which case, such gains are recorded in OCI. Equity instruments
designated at fair value through OCI are not subject to impairment assessment.
The Group elected to classify irrevocably its listed equity investments under
this category.
(l) Reclamation costs
The Group's mining and exploration activities are subject to various
governmental laws and regulations relating to the protection of the
environment. The Group records a liability for the estimated future
rehabilitation costs and decommissioning of its development projects at the
time a constructive obligation is determined.
When provisions for closure and environmental rehabilitation are initially
recognised, the corresponding cost is capitalised as an intangible asset,
representing part of the cost of acquiring the future economic benefits of the
operation. The capitalised cost of closure and environmental rehabilitation
activities is recognised in mining interests and, from the commencement of
commercial production, is amortised over the expected useful life of the
operation to which it relates. Any change in the value of the estimated
expenditure is reflected in an adjustment to the provision and asset.
(m) Standards, amendments and interpretations not yet
effective
At the date of authorisation of these financial statements, there are no
amended reporting standards and interpretations that impact the Group as they
are either not relevant to the Group's activities or require accounting which
is consistent with the current accounting policies.
(n) Judgements and estimations in applying accounting
policies
In the process of applying the Group's accounting policies above, management
has identified the judgemental areas that have the most significant effect on
the amounts recognised in the financial statements:
Intangible assets - exploration and evaluation
IFRS 6 "Exploration for and Evaluation of Mineral Resources" requires that
exploration and evaluation assets shall be assessed for impairment when facts
and circumstances suggest that the carrying amount may exceed recoverable
amount.
In practical terms, this requires that project carrying values are regularly
monitored and assessed for recoverability whether from future exploitation of
resources or realised by sale to a third party.
Where activities have not reached a stage, which permits reasonable
confirmation of the existence of mineral reserves, the directors must form a
judgement whether future exploration and evaluation should continue. This
requires management to use their sector experience, apply their specialist
expertise and form a conclusive judgement whether or not, on the balance of
evidence that further exploration is justified to determine if an economically
viable mining operation can be established in future. Such estimates,
judgements and assumptions are likely to change as new information and
evidence becomes available. If it becomes apparent, in the judgement of the
directors, that recovery of capitalised expenditure is unlikely, the carrying
value should be considered as impaired and treated as detailed below.
Impairment
Impairment reviews for deferred exploration and evaluation costs are carried
out on a project-by-project basis, with each project representing a potential
single cash generating unit. The directors are required to continually monitor
and review the carrying values by reference to new developments, stages in the
exploration process and new circumstances. Assessment of the potential
impairment of assets requires an updated judgement of the probability of
adequate future cash flows from the relevant project. It includes
consideration of:
(i) The period for which the entity has the right to explore
in the specific area and whether this right will expire in the near future,
and whether the right is expected to be renewed.
(ii) Whether substantive expenditure on further exploration for
and evaluation of mineral resources for the specific project is either
budgeted or planned.
(iii) Whether exploration for and evaluation of mineral resources
on the specific project has led to the discovery of commercially viable
quantities of mineral resources and whether the entity has decided to
discontinue such activities on the project.
(iv) Whether sufficient data exist to indicate that, although a
development on the specific project is likely to proceed, the carrying amount
of the exploration and evaluation asset is likely to be recovered in full from
successful development of a mine or by the sale of the project.
The judgements in respect of key projects are as follows;
The CS Project in Nevada continues to be the Group's lead project with a
carrying value of £1,312,925. In the judgement of the directors, this is
justified as, following the successful grant of various mining and production
permits, discussions remain ongoing with potential customers and partners for
the development of the project.
At the Hazen Project, the Company is awaiting the outcome of customer trials
and discussions with potential customers and partners for the development of
the project is continuing, therefore the project is not impaired.
The Pioche Project is under evaluation by Tolsa S.A. which has carried out
further drilling, fieldwork and testwork during the reporting period and so no
impairment is justified.
The Reese Ridge Project is an early-stage exploration project and drill
targets were defined in 2023. As exploration is ongoing, with drilling
budgeted for in 2025, the project is not impaired.
Although there has been no exploration during the reporting period on the
County Line Project, Nevada (carrying value £147,538), in the judgement of
the directors, further evaluation of the production potential is justified in
view of its proximity to the CS Project and project synergies. The Company's
mining claims have been renewed for a further 12-month period and the project
is not impaired.
Positive drilling results have previously been obtained from the Clayton
Project, Nevada (carrying value of £124,292) and drilling has been budgeted,
therefore in the opinion of the directors the project is not impaired.
Project leases and claims are being maintained for the Bay State Project,
Nevada, however due to the uncertainty of whether the Company will continue
its exploration activities at the project, it is the judgement of the
directors that the carrying value of £422,135 be impaired.
Also, in relation to other projects, the exploration rights are being
maintained and further exploration and/or drilling is budgeted therefore the
directors have reached the conclusion that no other impairments are required.
Going concern
The preparation of financial statements requires an assessment of the validity
of the going concern assumption. This in turn is dependent on finance being
available for the continuing working capital requirements of the Group. Based
on the assumption that such finance will become available, the directors
believe that the going concern basis is appropriate for these accounts, Note
1(b) refers.
Share warrants and share-based payments
The estimates of costs recognised in connection with the fair value of share
warrants requires that management selects an appropriate valuation model and
make decisions on various inputs into the model including the volatility of
its own share price, the probable life of the warrants before exercise, and
behavioural consideration of warrant holders.
Investments in subsidiaries
Investments in subsidiaries, including long-term loans, are valued at the
lower of cost or recoverable amount, with an ongoing review for impairment.
This includes assessment of the net assets in subsidiaries and the
recoverability of the long-term projects.
(o) Other income
Other income is not recognised until the right to receive payment is
established and payment is certain, also see Note 23.
(p) Revenue recognition
The revenue of the Group arises from its mineral projects. The revenue
comprises of income derived from the sale of these projects and other sources,
such as royalty income. Sales are measured at the fair value of the
consideration received or receivable after deducting discounts, value added
tax and other withholding tax.
The royalty income becomes receivable on extraction and sale of the relevant
underlying commodity, and by determination of the relevant royalty agreement.
The Group considers the a royalty to be a direct interest in the underlying
mineral asset. Existence risk (the commodity physically existing in the
quantity demonstrated), production risk (that the operator can achieve
production and operate a commercially viable project), timing risk
(commencement and quantity produced, determined by the operator) and price
risk (returns vary depending on the future commodity price, driven by future
supply and demand) are all risks which the Group participates in on a similar
basis to an owner of the underlying mineral licence.
A royalty asset is a right to receive cash to the extent there is production
and there are no interest payments, minimum payment obligations or means to
enforce production or guarantee payment. Royalties are accounted for as
intangible assets under IAS 38 and carried at cost less accumulated
amortisation and any impairment provision with royalty or offtake income being
recognised as revenue in the income statement.
The carrying value of the royalty asset is amortised to the income statement
on a unit-of-production basis as revenues are earned with the Intangible asset
being assessed for indicators of impairment at each period end.
(q) Cost of sales
Cost of sales includes the disposal of costs previously capitalised as
exploration as exploration assets which has been accumulated over the life of
the asset prior to disposal. All other operating expenses incurred in the
ordinary course of business are recorded in administration costs.
2. Revenue
2024 2023
£ £
Sale agreement with Dicalite 112,050 -
112,050 -
Sale agreement with Dicalite
In March 2024, the Company entered into an sale agreement with Dicalite
Management Group ("Dicalite") for the 29 mining claims held for the Diatomite
in the Crow Springs area of Nevada, USA, for a total consideration of
US$150,000 and the first US$75,000 was received March 2024. The remaining
US$75,000 was received in November 2024.
3. Cost of sale
2024 2023
£ £
Capitalised cost for CS Diatomite Project 41,146 -
41,146 -
4. Loss before income tax
The operating loss is stated after charging: 2024 2023
£ £
Fees payable to the Company's auditor for:
The audit of the Company's annual accounts 31,000 18,242
Other Services:
Interim review of accounts 2,000 1,725
Corporation tax fees 5,334 1,045
5. Directors' emoluments
Remuneration in respect of directors was as follows: 2024 2023
£ £
P L Cheetham (salary) 24,000 21,333
J Cole (salary) 24,000 21,333
R D Murphy (salary) 24,000 21,333
72,000 63,999
The above remuneration amounts do not include non-cash share-based payments
charged in these financial statements in respect of share warrants issued to
the directors amounting to £Nil (2023: £4,335) or Employer's National
Insurance contributions of £4,140 (2023: £3,589).
The directors are also the key management personnel. If all benefits are taken
into account, the total key management personnel compensation would be
£76,140 (2023: £71,924).
6. Staff costs
Staff costs for the Group and the Company, including directors, were as 2024 2023
follows:
£ £
Wages and salaries 72,000 64,000
Social security costs 4,140 3,589
Share-based payments - 4,335
76,140 71,924
The average monthly number of employees employed by the Group and the Company 2024 2023
during the year was as follows:
Number Number
Directors 3 3
3 3
The Company does not employ any staff directly apart from the directors. The
services of technical and administrative staff are provided by Tertiary
Minerals plc as part of the Management Services Agreement between the two
companies (see Note 17).
The Company issues share warrants to employees of Tertiary Minerals plc from
time to time and these non-cash share-based payments resulted in a charge
within the financial statements of £727 (2023: £118).
Company secretarial services are provided by Mr R. Venables through City Group
plc.
7. Loss per share
Loss per share has been calculated using the loss for the year attributable to
equity holders of the Company and the weighted average number of shares in
issue during the year.
2024 2023
Loss (£) (658,806) (391,291)
Weighted average shares in issue (No.) 4,360,320,952 3,955,796,532
Basic and diluted loss per share (pence) (0.015) (0.010)
The loss attributable to ordinary shareholders and weighted average number of
ordinary shares for the purpose of calculating the diluted earnings per
ordinary share are identical to those used for the basic earnings per ordinary
share. This is because the exercise of share warrants would have the effect of
reducing the loss per ordinary share and is therefore anti-dilutive.
8. Income tax
No liability to corporation tax arises for the year due to the Group recording
a taxable loss (2023: £Nil).
The tax credit for the period is lower than the credit resulting from the loss
before tax at the standard rate of corporation tax in the UK - 19% (2023:
19%). The differences are explained below.
Tax reconciliation 2024 2023
£ £
Loss before tax (658,806) (391,291)
Tax at 19% (2023: 19%) (125,173) (74,345)
Pre-trading expenditure not deductible for tax purposes 92,671 5,305
Expenditure not deductible for tax purposes 1,918 11,752
Unrelieved losses carried forward 30,584 57,288
Tax charge/credit for year - -
Total losses carried forward (4,576,350) (4,448,062)
Factors that may affect future tax charges
The Group has total losses carried forward of £4,576,350 (2023: £4,448,062).
This amount would be charged to tax, thereby reducing tax liability, if
sufficient profits were made in the future capped to £5m per annum allowance.
The deferred tax asset has not been recognised as the future recovery is
uncertain given the exploration status of the Group.
9. Investments
Subsidiary undertakings
Company Country of Date of Type and percentage Principal activity
incorporation/ incorporation/ of shares held at
registration registration 30 September 2024
Sunrise Minerals Australia Pty Ltd Australia 7 October 2009 100% of ordinary shares Mineral exploration
SR Minerals Inc. Nevada, USA 12 January 2014 100% of ordinary shares Mineral exploration
Westgold Inc. Nevada, USA 13 April 2016 100% of ordinary shares Mineral exploration
The registered office of Sunrise Minerals Australia Pty Ltd is Level 4, 35-37
Havelock Street West, Perth, WA 6005.
The registered office of SR Minerals Inc. and Westgold Inc. is 241 Ridge
Street, Suite 210, Reno, NV 89501.
Investment in subsidiary undertakings Equity Loans Company Company
2024 2024 2024 (restated)
£ £ £ 2023
£
Value at start of year 63 2,992,160 2,992,223 3,192,066
Additions - (231,364) (231,364) 144,700
Movement in provision - (15,363) (15,363) -
Prior year adjustment - - - (344,543)
At 30 September 63 2,745,433 2,745,496 2,992,223
Investments in share capital of subsidiary undertakings
The directors consider that the carrying value of the Company's investments in
shares of subsidiary undertakings totalling £63 is not material and therefore
does not require an impairment review.
Loans to Group undertakings
Amounts owed by subsidiary undertakings are unsecured and payable in cash.
Loan interest is charged to US subsidiaries on intercompany loans with Parent
Company.
A review of the recoverability of investments in and loans to subsidiary
undertakings totalling £2,745,496 has been carried out in accordance with
IAS 36. As a result, the directors have concluded that there is a potential
credit loss arising in the year. Sunrise Minerals Australia Pty Ltd provision
increased by £15,363 to fully impair the loan balance. The assessment has
been based upon a review of the underlying exploration assets held by the
subsidiary undertakings.
Other investments - listed investments
Company Country of Type and percentage Principal activity
incorporation/ of shares held at
registration 30 September 2024
VR Resources Ltd Canada 0.08% of ordinary shares Mineral exploration
Power Metal Resources plc United Kingdom 0.034% of ordinary shares Mineral exploration
Investment designated at fair value through OCI Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Value at start of year 11,192 5,625 20,075 11,250
Movement in valuation (1,954) 94 (7,466) (5,625)
Movement in foreign exchange (1,308) - (1,417) -
At 30 September 7,930 5,719 11,192 5,625
The fair value of the investment is equal to the market value of its shares at
30 September 2024, based on the closing mid-market price of shares on its
equity exchange market.
These are level one inputs for the purpose of the IFRS 13 fair value
hierarchy.
10. Intangible assets
Exploration evaluation assets Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Cost
At start of year 5,332,034 2,203,594 5,426,535 2,203,594
Reclamation (2,424) - - -
Additions 102,580 - 124,761 -
Transferred to cost of sales (41,146) - - -
Foreign currency exchange adjustments (213,360) - (219,262) -
At 30 September 5,177,684 2,203,594 5,332,034 2,203,594
Impairment
At start of year (2,922,723) (2,203,594) (2,922,723) (2,203,594)
Impairment losses during the year (422,135) - - -
At 30 September (3,344,858) (2,203,594) (2,922,723) (2,203,594)
Net book value
At 30 September 1,832,826 - 2,409,311 -
At start of year 2,409,311 - 2,503,812 -
During the year the directors carried out an impairment review with reference
to IFRS 6.20 (a) which resulted in an impairment of £422,135 in relation to
the impairment of exploration costs in connection with the Bay State Project.
Refer to accounting policy 1(d) and 1(n) for a description of the
considerations used in the impairment review.
11. Property, plant and equipment
The Group has the use of tangible assets held by a related undertaking,
Tertiary Minerals plc, under a Management Services Agreement between the two
companies.
12. Receivables
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Prepayments 16,700 13,408 18,528 16,203
Accrued income 56,025 - - -
Other receivables 107,088 9,518 126,931 14,166
At 30 September 179,813 22,926 145,459 30,369
13. Cash and cash equivalents
Cash at bank and in hand Group Company Group Company
2024 2024 2023 2023
£ £ £ £
At 30 September 102,425 83,265 177,967 160,711
14. Trade and other payables
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Amounts owed to related undertaking - Tertiary Minerals plc 25,954 25,954 50,749 50,749
Trade creditors - - 10,095 8,993
Accruals 54,395 35,913 31,734 23,265
Deferred income 7,470 - 4,098 -
Other payables 33,153 33,153 10,916 10,916
Other taxation and social security 6,915 6,915 1,181 1,181
At 30 September 127,887 101,935 108,773 95,104
15. Share capital and reserves
2024 2024 2023 2023
Number £ Number £
Share capital - Allotted, called up and fully paid
Ordinary shares
Balance at start of year 4,095,052,030 4,095,052 3,833,559,087 3,833,559
Ordinary shares at 0.1 pence each
Ordinary shares issued in the year 849,928,666 8,500 261,492,943 261,493
Share sub-division - creation of deferred shares of 0.099p each 4,095,052,030 - - -
Share sub-division - cancellation of deferred shares of 0.099 pence each (4,095,052,030) (4,054,102) - -
Balance at 30 September 4,944,980,696 49,450 4,095,052,030 4,095,052
Ordinary shares at 0.001 pence each
During the year to 30 September 2024, the following share issues took place:
An issue of 4,095,052,030 Deferred Shares of 0.099 pence each resulting from
the sub-division of shares (22 November 2023). Note 25 refers.
An issue of 10,000 0.001p Ordinary Shares at 0.07p per share to fund the buy
back and cancellation of the deferred shares resulting from the sub-division
of shares (29 November 2023).
An issue of 27,474,222 0.001p Ordinary Shares at 0.045p per share to three
directors, for a total consideration of £12,363 in satisfaction of directors'
fees (23 February 2024).
An issue of 27,777,778 0.001p Ordinary Shares at 0.045p per share in
settlement of a portion of outstanding net fees to Mining and Metals Research
Corporation, for a total consideration of £12,500 (23 February 2024).
An issue of 125,000,000 0.001p Ordinary Shares at 0.02p per share, by exercise
of conversion rights (TNZ convertible loan note), for a total consideration of
£25,000 before expenses (5 March 2024).
An issue of 133,333,333 0.001p Ordinary Shares at 0.03p per share, by exercise
of conversion rights (TNZ convertible loan note), for a total consideration of
£40,000 before expenses (24 May 2024).
An issue of 403,000,000 0.001p Ordinary Shares at 0.05p per share, via placing
for a total of £201,500 before expenses (1 July 2024).
An issue of 133,333,333 0.001p Ordinary Shares at 0.03p per share, by exercise
of conversion rights (TNZ convertible loan note), for a total consideration of
£40,000 before expenses (19 August 2024).
During the year to 30 September 2023 a total of 216,492,943 0.1p ordinary
shares were issued, at an average price of 0.34p per share, for a total
consideration of £118,636 net of expenses.
Nature and purpose of reserves
Foreign currency reserve
Exchange differences relating to the translation of the net assets of the
Group's foreign operations, which relate to subsidiaries only, from their
functional currency into the Parent's functional currency, being Sterling, are
recognised directly in the foreign currency reserve.
Share warrant reserve
The share warrant reserve is used to recognise the value of equity-settled
share warrants provided to employees, including key management personnel, as
part of their remuneration, and to third parties in connection with
fundraising. Refer to Note 16 for further details.
Share premium reserve
The share premium account represents premiums received on the initial issuing
of the share capital. Any transaction costs associated with the issuing of
shares are deducted from share premium.
Fair value reserve
Fair value reserve represents the cumulative fair value changes of
available-for-sale equity investment assets.
Capital redemption reserve
Non distributable reserve into which amounts are transferred following the
redemption or the purchase of a company's own shares. The provisions relating
to the capital redemption reserve are set out in section 733 of the Companies
Act 2006.
16. Share warrants granted
Warrants not exercised or expired at 30 September 2024
Issue date Exercise price Number Exercisable Expiry date
05/08/20 0.195p 35,000,000 *Any time from 05/08/21 05/08/25
08/08/22 0.113p 8,000,000 Any time from 05/08/23 05/08/27
09/08/23 0.100p 9,000,000 Any time from 09/08/24 09/08/28
05/07/24 0.050p 15,150,000 Any time from 05/07/24 05/07/25
05/07/24 0.075p 201,500,000 Any time from 05/07/24 05/07/25
Total 268,650,000
*Of these, 15,000,000 warrants cannot be exercised before the Company makes
the first sustainable sale of perlite/pozzolan product from the CS Project.
Share warrants are issued for nil consideration and are exercisable as
disclosed above. They are exchangeable on a one for one basis for each
ordinary share of 0.001p at the exercise price on the date of conversion.
Share warrant movements:
2024 2023
Number of Weighted Number of share warrants Weighted
share average average
warrants exercise exercise
price price
(Pence) (Pence)
Outstanding at start of year 85,000,000 0.16 168,750,000 0.19
Granted during the year 216,650,000 0.07 34,000,000 0.14
Expired during the year (33,000,000) 0.15 (117,750,000) 0.20
Outstanding at end of year 268,650,000 0.09 85,000,000 0.16
Exercisable at end of year 268,650,000 0.09 51,000,000 0.17
The share warrants outstanding at 30 September 2024 had a weighted average
exercise price of 0.09p (2023: 0.16p), a weighted average fair value of 0.01p
(2023: 0.05p) and a weighted average remaining contractual life of 0.94 years.
In the year ended 30 September 2023, warrants were granted on 9 August 2023
to non-executive directors of the Company and employees of Tertiary Minerals
plc with an aggregate estimated fair value of £1,902. Note 6 explains the
value recognised in the reporting period in respect of Tertiary Minerals plc.
In the year ended 30 September 2024, warrants were granted on 1 July 2024 as
part of a fundraise and to Peterhouse Capital Limited as settlement of a
broker commission fee with an aggregate estimated fair value of £4,198.
In the year to 30 September 2024, the Company recognised expenses of £6,147
(2023: £5,319) related to issuing of share warrants in connection with
equity-settled share-based payment transactions. The fair value is charged to
administrative expenses and where there is a vesting period it is charged on a
straight-line basis over the vesting period, together with a corresponding
increase in equity, based on the management's estimate of shares that will
eventually vest.
The fair values of warrants are estimated using a Black-Scholes-Merton Pricing
Model and charged to administrative expenses on a straight-line basis over the
vesting period, together with a corresponding increase in equity, based on the
management's estimate of shares that will eventually vest.
The inputs into the Black-Scholes-Merton Pricing Model were as follows: 2024 2023
Weighted average share price 0.05p 0.09p
Weighted average exercise price 0.8p 0.14p
Expected volatility 50% 50%
Expected life 1 4.74
Risk-free rate 4%% 0.04%
Expected dividend yield 0% 0%
Expected volatility was determined by calculating the historical volatility of
the Company's share price over the previous 3 years. The expected life used in
the model has been adjusted, based on management's best estimate, for the
effects of non-transferability, exercise restrictions and behavioural
considerations.
17. Related party transactions
Key management personnel
The directors holding office at the year end and their warrants held in the
share capital of the Company are:
At 30 September 2024 At 30 September 2023
Shares Share Warrant Warrant Shares Share
number warrants exercise expiry number warrants
number price date number
P L Cheetham* 381,832,572 **50,000,000 0.075p 05/07/25 255,785,016 30,000,000
15,000,000 0.195p 05/08/25 (†)25,000,000
(††)15,000,000 0.195p 05/08/25 ( )
J Cole 32,768,986 2,500,000 0.113p 05/08/27 20,555,653 5,000,000
2,500,000 0.100p 09/08/28
R D Murphy 90,999,010 2,000,000 0.195p 05/08/25 78,785,677 9,000,000
2,500,000 0.113p 05/08/27
2,500,000 0.100p 09/08/28
*Includes 5,500,000 shares held by K E Cheetham, wife of P L Cheetham
**These 50,000,000 warrants are held in a nominee company, however P L
Cheetham is the underlying shareholder
(†)These 25,000,000 warrants did not meet their vesting criteria and expired
on 31 December 2023
(††)These 15,000,000 warrants will vest on the first sale of
pozzolan/perlite
Tertiary Minerals plc
Sunrise Resources plc is treated as an investment in the consolidated accounts
of Tertiary Minerals plc, which held 0.44% of the issued share capital of
Sunrise Resources plc on 30 September 2024 (2023: 0.54%).
Under a Management Services Agreement, Tertiary Minerals plc provides
management services to Sunrise Resources plc and consequently during the year
the Group incurred costs of £147,718 (2023: £166,429).
At the balance sheet date, an amount of £25,958 (2023: £50,753 was due to
Tertiary Minerals plc, included in trade and other payables (Note 14).
Patrick Cheetham, the Executive Chairman of the Company, is also a director of
Tertiary Minerals plc.
18. Leases
Right of use assets Group Group
2024 2023
£ £
Cost
At start of year 23,175 25,399
Foreign currency exchange adjustments (2,052) (2,224)
At 30 September 21,123 23,175
Depreciation
At start of year (17,639) (14,252)
Charge for the year (5,046) (4,635)
Disposals - -
Foreign currency exchange adjustments 1,562 1,248
At 30 September (21,123) (17,639)
Carrying amounts
At 30 September - 5,536
At start of year 5,536 11,147
Lease liabilities Group Group
2024 2023
£ £
Cost
At start of year 2,644 5,713
Lease payments (2,412) (2,623)
Interest charge - 54
Foreign currency exchange adjustments (232) (500)
At 30 September - 2,644
The right of use assets and related liabilities were for the lease of water
rights for use in conjunction with the CS Project in Nevada, USA. As of March
2024, a mutual termination agreement was reached, removing any future
obligations.
19. Capital management
The Group's capital requirements are dictated by its project and overhead
funding requirements from time to time. Capital requirements are reviewed by
the Board on a regular basis.
The Group manages its capital to ensure that entities within the Group will be
able to continue as going concerns, to increase the value of the assets of the
business and to provide an adequate return to shareholders in the future when
exploration assets are taken into production.
The Group manages the capital structure and makes adjustments to it in the
light of changes in economic conditions and the risk characteristics of its
assets. In order to maintain or adjust the capital structure the possibilities
open to the Group in future include issuing new shares, consolidating shares,
returning capital to shareholders, taking on debt and selling assets.
20. Financial instruments
At 30 September 2024, the Group's and Company's financial assets consisted of
receivables due within one year, other investments and cash and cash
equivalents. At the same date, the Group and Company had no financial
liabilities other than trade and other payables due within one year and had no
agreed borrowing facilities as at this date. There is no material difference
between the carrying and fair values of the Group's and Company's financial
assets and liabilities.
The carrying amounts for each category of financial instrument held at 30
September 2024, as defined in IFRS 9, are as follows:
Group Company Group Company
2024 2024 2023 2023
£ £ £ £
Financial assets at amortised cost 209,514 92,784 304,898 174,877
Financial assets at fair value through other comprehensive income 7,930 5,179 11,192 5,625
Financial Liabilities at amortised cost 307,304 290,019 435,663 393,923
Risk management
The principal risks faced by the Group and Company resulting from financial
instruments are liquidity risk, foreign currency risk and, to a lesser extent,
interest rate risk and credit risk. The directors review and agree policies
for managing each of these risks as summarised below. The policies have
remained unchanged from previous periods as the risks are assessed not to have
changed.
Liquidity risk
The Group holds cash balances in Sterling, US Dollars, Australian Dollars and
others to provide funding for exploration and evaluation activity, whilst the
Company holds cash balances in Sterling, US Dollars, Australian Dollars and
small amounts in other currencies.
The Company is dependent on equity fundraising through private placings which
the directors regard as the most cost-effective method of fundraising. The
directors monitor cash flow in the context of their expectations for the
business to ensure sufficient liquidity is available to meet foreseeable
needs.
Currency risk
The Group's financial risk management objective is broadly to seek to make
neither profit nor loss from exposure to currency or interest rate risks. The
Group is exposed to transactional foreign exchange risk and takes profits and
losses as they arise as, in the opinion of the directors, the cost of hedging
against fluctuations would be greater than the related benefit from doing so.
Fluctuations in the exchange rate may have a material effect on reported loss
or equity.
Bank balances were held in the following denominations: Group Company Group Company
2024 2024 2023 2023
£ £ £ £
United Kingdom Sterling 70,487 70,487 158,988 158,988
Australian Dollar 3,135 933 4,302 635
United States Dollar 28,727 11,769 14,599 1,010
Other 76 76 78 78
Interest rate risk
The Company finances operations through equity fundraising. The Company
currently has borrowings in the form of convertible securities in respect of
which fees are payable on conversion where the market price of the Company's
ordinary shares is less than the par value.
Fluctuating interest rates have the potential to affect the loss and equity of
the Group and the Company insofar as they affect the interest paid on
financial instruments held for the benefit of the Group. The directors do not
consider the effects to be material to the reported loss or equity of the
Group or the Company presented in the financial statements.
Credit risk
The Company has exposure to credit risk through receivables such as VAT
refunds, invoices issued to related parties and its joint arrangements for
management charges. The amounts outstanding from time to time are not material
other than for VAT refunds which are considered by the directors to be low
risk.
The Company has exposure to credit risk in respect of its cash deposits with
NatWest bank and this exposure is considered by the directors to be low risk.
21. Provisions
Group 2024 2023
£ £
Reclamation Liability 29,525 32,079
At start of year
Reduction/reversal (2,424) -
Interest - 255
Exchange adjustments (2,616) (2,809)
At 30 September 24,485 29,525
The Group makes provision for future reclamation costs relating to exploration
projects. Provisions are calculated based upon internal estimates and expected
costs based upon past experience and expert guidance where appropriate.
Reclamation liabilities are covered by reclamation bonds and reclamation takes
place when exploration on a particular project or project area terminates or
when the Company seeks repayment of a particular reclamation bond. Estimates
of reclamation liability are made using regularly updated government
exploration cost estimation software and the risk associated with such
estimates is judged by the directors to be low.
22. Contingent assets
The Company has the following contingent assets:
Golden Metal Resources plc 2% Net Smelter Return Royalty, received as part of
the consideration for the disposal of the Stonewall and Garfield exploration
projects in June 2021.
No values have been assigned to these contingent assets on the basis that
realisation is uncertain and considered to be unpredictable.
23. Other income
2024 2023
£ £
Lease Option agreement with Kinross 3,735 4,098
Sale Option agreement with Tolsa 74,700 32,783
78,435 36,881
Lease Option agreement with Kinross
In October 2021, the Company entered into a lease/option agreement with
Kinross Gold U.S.A., Inc. ("Kinross") granting Kinross a Lease and Option to
purchase the Company's 25 Jackson Wash mining claims in Nevada, USA. Under the
terms of the Agreement, a lease payment was made to the Company of US$5,000
for the year 3 of the lease. If the Option is exercised, the Company will
retain a 2.5% Net Smelter Return Royalty.
Sale Option agreement with Tolsa
In June 2022, the Company granted Tolsa USA, Inc. ("Tolsa") an option to
purchase the Pioche Sepiolite Project. This option was extended in December
2023 and Tolsa paid a US$100,000 extension fee to the Company.
24. Convertible Loan note
On 29 November 2022, the Company raised £280,000 through a share placing of
80,000,000 new ordinary shares at a price of 0.1 pence per share and the
issue of a £200,000 convertible security (the "First Convertible Security).
The agreement, with US institutional investor Towards Net Zero, LLC ("TNZ"),
allowed the Company to issue a further convertible security within 6 months of
the Closing Date, 6 December 2022, to raise a further £200,000 subject to
certain conditions precedent.
On 5 June 2023, the conditions precedent were met, and the Company issued a
further £200,000 convertible security (the "Second Convertible Security).
As of 30 September 2023, £100,000 redemption shares were converted, bringing
the total convertible security to £300,000.
The convertible securities balance at 30 September 2024 totalled £195,000
having been reduced by £105,000 as follows:
a) On 5 March 2024, the Company announced that it had received a
Conversion Notice from TNZ in respect of £25,000 of the First Convertible
Security. As a result, the Company issued a total of 125,000,000 new ordinary
shares at a price of 0.2 pence per share.
b) On 31 May 2024, the Company announced that it had received a further
Conversion Notice from TNZ in respect of £40,000 of the First Convertible
Security. As a result, the Company issued a total of 133,333,333 new ordinary
shares at a price of 0.3 pence per share.
c) On 19 August 2024, the Company announced that it had received a
further Conversion Notice from TNZ in respect of £40,000 of the First
Convertible Security. As a result, the Company issued a total of 133,333,333
new ordinary shares at a price of 0.3 pence per share.
The Agreement with TNZ provides that when the convertible securities are fully
repaid or fully converted an equalisation payment become due to the Company
from TNZ, or vice versa, based on the number of shares issued to TNZ under the
placing and the then prevailing share price relative to the placing price.
The convertible securities are free of interest.
25. Capital Restructure
At a General Meeting on 22 November 2023, the shareholders approved the
sub-division of the Company's ordinary share capital (the "Sub-Division"),
whereby each existing Ordinary Share with a nominal value of 0.1p was
subdivided into 1 new Ordinary Share of 0.001p and 1 Deferred Share of 0.099p
each, and the subsequent buy back and cancellation ("Buy Back and
Cancellation") of the Deferred Shares. The Sub-Division was completed on
23 November 2023. The Deferred Shares had no significant rights attached to
them and carried no right to vote or to participate in distribution of surplus
assets and were not admitted to trading on the AIM market of the London Stock
Exchange plc. The Deferred Shares effectively carried no value and the Buy
Back and Cancellation was completed on 29 November 2023 and was funded by an
issue of 10,000 ordinary shares at 0.07 pence made for that specific purpose.
26. Events after the year-end
Crow Springs Diatomite Project
Following the sale of a group of mining claims in the Crow Springs area of
Nevada, USA, to Dicalite Management Group during the reporting period, the
Company received the remaining half of the purchase price, being US$75,000, on
25 November 2024.
Pioche Project
Tolsa USA Inc. ("Tolsa") contacted the Company late in December to advise that
it will not proceed to exercise its option to purchase the Company's Pioche
Sepiolite Project in Nevada, USA.
The option was originally granted on 28 June 2022 and was extended for an
additional 12 months as announced on 27 December 2023.
CS Natural Pozzolan Project
On 5 December 2024, SR Minerals Inc. received a partial refund of the bond
deposited with the US Bureau of Land Management in connection with the CS
Natural Pozzolan Project in the amount of US$ $59,452.
On 4 February 2025 SR Minerals Inc. received a payment of US$29,300 from a
cement company being 50% of the costs of providing that company with a bulk
sample of CS Project natural pozzolan.
27. Prior year errors
The accounts for the previous year were restated due to errors in the
retranslation of investments in subsidiaries. This resulted in a reduction to
accumulated losses as at the start of the prior period, 1 October 2022 of
£582,653, with a corresponding increase in the investment in subsidiaries. An
adjustment was also required to the accumulated losses and investment in
subsidiaries as at 30 September 2023 of £238,110, together with an
adjustment to the loss for the year of £344,543. The restated loss for the
year is £703,425.
The effects of the correction of the errors have been reflected in the Company
statement of financial position and have no further impact on previously
reported amounts:
Company Company Company (restated)
(restated) (as previously reported) 1 October 2022
30 September 2023 £
2023 £
£
Non-current assets
Investment in subsidiaries 2,992,223 2,754,113 3,192,066
Other investments 5,625 5,625 11,250
2,997,848 2,759,738 3,203,316
Current assets
Receivables 30,369 30,369 49,164
Cash and cash equivalents 160,711 160,711 73,644
191,080 191,080 122,808
Current liabilities
Trade and other payables (95,104) (95,104) (90,061)
Convertible Loan Note (300,000) (300,000) -
(395,104) (395,104) (90,061)
Net current (liabilities)/assets (204,024) (204,024) 32,747
Net assets 2,793,824 2,555,714 3,236,063
Equity
Called up share capital 4,095,052 4,095,052 3,833,559
Share premium account 5,680,316 5,680,316 5,680,316
Share warrant reserve 42,815 42,815 40,101
Fair value reserve 11,874 11,874 17,500
Foreign currency reserve 1,321 1,321 1,321
Accumulated losses (7,037,554) (7,275,664) (6,336,734)
Equity attributable to owners of the parent 2,793,824 2,555,714 3,236,063
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