The information contained within
this announcement is deemed to constitute inside information as
stipulated under the retained EU law version of the Market Abuse
Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law
by virtue of the European Union (Withdrawal) Act 2018. The
information is disclosed in accordance with the Company's
obligations under Article 17 of the UK MAR. Upon the publication of
this announcement, this inside information is now considered to be
in the public domain.
10 December 2024
Technology Minerals Plc
("Technology Minerals", the "Company" or the
"Group")
Full
Year Results
Publication of Annual Report and Accounts
Technology Minerals Plc (LSE:
TM1), the first listed UK company focused on creating a sustainable
circular economy for battery metals, announces full year results
for the 12-month period ended 30 June 2024.
Exploration portfolio
· Global Battery
Metals Ltd ("GBML") exercised its Second Option at the Leinster
Lithium Property ("Leinster"), increasing its interest to
55%.
·
GBML structural remote sensing study of the
Leinster Lithium District identified 25 new exploration
targets.
·
Completed the first phase of drilling at
Knockeen, which confirmed a swarm of pegmatite dikes within host
granites to reveal a structurally controlled LCT pegmatite
system.
·
Initial trench sampling at Knockeen returned
assay results grading as high as 2.55% Li2O.
·
Signed agreement to sell its interest in Leinster
exploration licences in for a gross consideration of US$10
million.
Recyclus Group Ltd ("Recyclus"), a 48.35% Technology Minerals
owned associate company
·
Completed commissioning phase and began
commercial operations at the UK's first industrial scale lithium
ion ("Li-ion") battery recycling facility.
·
Received first orders of LiBoxes, from automotive
retail group Waylands, to supply Liboxes for storing waste
Li-ion batteries across its Volvo retail network sites in Bristol,
Reading and Oxford.
·
Partnered with Servicesure Autocentres to recycle
Li-ion batteries from its network of 600+ independent autocentres
in the UK.
·
Signed agreement to recycle Li-ion batteries from
Beryl's fleet of e-bikes and e-scooters.
·
Received Li-ion batteries for recycling from AA
Battery Recycling Limited.
Corporate
· Raised
£1.2 million from a long-term shareholder through the issue of
Convertible Loan Notes in July and September 2023.
· Secured
a £5.5 million convertible bond facility (before expenses) with
Atlas Capital Markets ("ACM") in March 2024, under which £2.5
million has been drawn.
Post Period
·
Between 1 July 2024 and 15 October 2024, the
Company issued 195,366,656 new Ordinary shares in settlement of
convertible loan notes of £320k.
·
On 3 July 2024, Recyclus signed agreement with
LOHUM Cleantech, India's leading producer of sustainable energy
transition materials, for black mass offtake.
·
On 4 July 2024, Recyclus set up the UK's first
full-service Discharge and Dismantle Unit for Li-ion batteries,
covering collection to black mass separation on an industrial
scale.
·
On 30 August 2024, entered into a heads of
agreement by which Bluebird Metals LLC acquires a further 70%
interest in the Company's cobalt interest in Idaho, USA.
·
On 24 September 2024, it was agreed not to
proceed with the merger of Technology Minerals and Recyclus and to
revisit the process when circumstances permit.
·
On 25 September 2024, announced completion of
10-week project to recycle 4,000 Li-ion battery modules from a
leading engineering services and technology company.
·
Independent Non-Executive Director Phillip Beard
and Executive Director Wilson Robb stepped down in September
2024.
·
On 19 November 2024, announced that Recyclus had
secured an agreement with Halfords Group plc to recycle waste
Li-ion e-mobility batteries for an initial period of 12
months.
·
On 24 November 2024, executed an agreement to
sell its interest in Leinster exploration licences in for a gross
consideration of US$10 million.
Alex Stanbury, Chief
Executive Officer of Technology Minerals, said:
"Technology Minerals is pleased to report steady
progress this year, with our strategy of advancing early-stage
critical metal mining projects delivering positive results. The
completed sale of the Leinster project highlights our ability to
enhance value through partnerships while minimising development
costs.
"Additionally, Recyclus has seen
increased commercial activity as production scales up at its
Wolverhampton facility. The company is in advanced discussions with
industry partners to expand operations both domestically and
internationally, ensuring a reliable supply of critical minerals to
support global electrification. With ongoing progress in our
exploration projects and the growth potential of Recyclus,
Technology Minerals is well positioned for the next phase of
development."
Enquiries
Technology Minerals Plc
|
|
Robin Brundle, Executive
Chairman
Alex Stanbury, Chief Executive
Officer
|
c/o +44 (0)20 4582 3500
|
|
|
Oberon Investments Limited (Broker)
|
|
Nick Lovering, Adam
Pollock
|
+44 (0)20 3179 0500
|
|
|
Gracechurch Group (Financial PR)
|
|
Harry Chathli, Alexis Gore, Rebecca
Scott
|
+44 (0)20 4582 3500
|
Technology Minerals Plc
Technology Minerals is developing
the UK's first listed, sustainable circular economy for battery
metals, using cutting-edge technology to recycle, recover, and
re-use battery technologies for a renewable energy future.
Technology Minerals is focused on raw material exploration required
for Li-ion batteries, whilst solving the ecological issue of spent
Li-ion batteries, by recycling them for re-use by battery
manufacturers. Further information on Technology Minerals is
available at www.technologyminerals.co.uk.
OPERATIONAL REVIEW
Technology Minerals continued to
advance its strategy of creating a fully circular economy for
critical battery metals by driving the exploration of raw materials
needed for Li-ion battery production, while solving the ecological
issues presented by spent battery units.
The Company achieved several key
milestones in its mission to incubate early-stage critical mineral
exploration projects, positioning them to attract larger partners
for further development. Steady progress was made across its
diverse portfolio of exploration assets, most notably with the
Leinster Lithium project in Ireland.
streamlined its operations and
optimised resource allocation to sharpen the Company's focus on its
exploration portfolio, while still maintaining an interest in
Recyclus, a pioneering battery recycling business. It is this
twin-track approach that can help to optimise supply of critical
minerals from all lifecycle stages.
Advancing critical battery mineral projects up the value
chain
Technology Minerals manages a
globally diverse portfolio of exploration projects focused on the
critical metals essential for the transition to electrification and
net zero. These projects target key metals like cobalt, copper,
lithium, nickel and manganese, with assets located in Ireland,
Spain, the USA and Cameroon.
The Company's project generation
and incubation strategy focuses on identifying early-stage projects
with significant growth potential, advancing them in a capital
light manner. Through prudent investment, the Company aims to
attract larger joint venture partners to further develop these
assets. This approach allows Technology Minerals to unlock
substantial value from its portfolio while minimising the financial
and dilutionary costs typically associated with public companies
developing exploration assets.
Technology Minerals' battery
metals portfolio by location and resource:
Project
|
Location
|
Resource
|
Asturmet
|
Spain
|
Nickel, Copper,
Cobalt
|
Blackbird Creek /
Emperium
|
USA
|
Primary Cobalt
|
Leinster
|
Republic of
Ireland
|
Lithium (spodumene
pegmatite)
|
Technology Minerals
Cameroon
|
Cameroon
|
Nickel Laterite,
Cobalt
|
Leinster, Ireland
The North-West Leinster lithium
property comprised of 16 prospecting licenses (under an exclusive
earn-in and option agreement with GBML) and seven wholly owned
licences. In April 2024, Technology Minerals signed a binding Heads
of Agreement to sell its entire Leinster exploration interests to
European Lithium Limited for a gross consideration of US$10
million, reinforcing our strategy of advancing early-stage projects
and attracting potential buyers. In November 2024, the Company
announced the completion of the sale. As a result of the sale, the
Company reached a Settlement Agreement with its joint venture
partner GBML, which remains subject to TSX-V approval and approval
from GBML shareholders at an annual and special meeting.
The sale followed the significant
progress made during the period to advance exploration activities
at Leinster. Following initial trench sampling at the Knockeen
lithium pegmatite project in December 2023, assays revealed lithium
grades as high as 2.55% Li2O from depths of 1-2 meters.
In October 2023, a comprehensive
structural synthesis of the entire Leinster pegmatite belt,
identified 25 follow-up targets, including four additional targets
on PLA 1597 and 21 new targets on the northern licence block,
leveraging geological, structural, geophysical and geochemical
studies.
GBML had previously exercised its
First Option in October 2022, acquiring 17.5% equity in the project
by spending up to €85,000. By July 2023, it had increased its
equity interest to 55% by spending €500,000, highlighting the
confidence in the project and their collaboration with Technology
Minerals.
The Company believes the sale of
Leinster is an excellent outcome for all stakeholders, bringing in
additional value. It validates the Company's strategy to identify
and advance early-stage projects up the value curve to attract
buyers and/or partners to bring significant additional value to the
Company.
Asturmet, Spain
Post the sale of Leinster
licences, Technology Minerals' will retain 100% of LHR's interests
in the Asturmet Project in Asturias, Spain, which covers up to
eight exploration permits for cobalt-nickel-copper mineralisation
(with 2 out of 8 licences granted so far). At the historic Aramo
mine, lithogeochemical sampling on the St Patrick licence has
yielded promising high-grade cobalt and copper results, alongside
nickel mineralisation. The St Patrick licence, granted in 2019,
runs to June 2025.
Cameroon
Technology Minerals holds five
exploration permits, at least three of which are considered
prospective for nickel-cobalt-rich laterite, on 2,456
km2 property in the East Region of southeastern
Cameroon. The permits lie in the same geological belt as the
world-class Nkamouna nickel-cobalt laterite deposit, where a
Measured and Indicated resource of 120.6 Mt @ 0.65% Ni, 0.23% Co
and 1.35% Mn has been identified, and are as such considered
prospective for this style of mineralisation.
A desktop evaluation report
submitted by Dr Sandy Archibald of Aurum Exploration Ltd in July
2023, identified areas for a proposed field-based sampling
programme based on new geological and geophysical data. Aside
from nickel-cobalt laterite, his study identified fourteen new
exploration targets with three of the targets considered a
priority. Two of the priority targets hold potential for
lithium-tantalum-niobium (±uranium) and Rare Earth Elements (REEs)
± uranium, and the third target is prospective for sediment-hosted
uranium. The majority of the other eleven targets are
prospective for intrusion-hosted copper, gold, or
uranium.
Oacama, South Dakota, USA
Following an assessment of the
economic benefit of the Oacoma licences, in which the Company held
a 15% working interest, the strategic decision was taken that the
asset would not form a core part of the Company's exploration
portfolio and therefore the licences were allowed to lapse. This
forms part of the Company's focused strategy to continue to assess
its portfolio of exploration assets and concentrate resources on
the more promising projects.
Blackbird Creek & Emperium, Idaho, USA
The Blackbird Creek and Emperium
(the "Idaho projects") consist of substantial cobalt, copper and
gold prospective land positions in Idaho. In 2022, the Company sold
a 10% interest in both its Blackbird Creek Project and Emperium
Project in Lemhi Country, Idaho to Canadian precious metals firm
BlueBird Metals LLC ("Bluebird Metals") for a cash consideration of
£900,000.
Following the year-end, the
Company entered into a heads of terms agreement with BlueBird
Metals under which it was agreed, subject to conditions precedents,
that BlueBird Metals would pay for the U$184,000 to meet the cost
of renewing the licences and would keep the licences in good
standing, as consideration for which, it was agreed Bluebird Metals
would receive an additional 70% interest in the Idaho projects. The
Company will retain 20% interest in the asset. This transaction
allows the Company to continue to focus its cash resources in
accordance with its strategic priorities.
Creating capacity for battery recycling
As part of Technology Minerals'
strategy to complement its battery minerals portfolio, the Company
remains supportive of Recyclus. This dual approach - exploring new
deposits of critical raw materials such as lithium, copper, cobalt
and nickel, while simultaneously recycling of Li-ion batteries,
aims to accelerate the development of a circular
economy.
Wolverhampton Li-ion battery recycling
plant
Technology Minerals' 48.35% owned
associated company, Recyclus, successfully concluded the
commissioning phase at its Wolverhampton plant in September 2023,
making it the first plant in the UK with the capacity to recycle
Li-ion batteries on an industrial scale. The fully operational
facility is now processing a steady stream of Li-ion battery waste
from various commercial sources and has achieved a notable
recycling rate of up to 45% net black mass yield.
The plant has also reached the 100
tonnes feedstock threshold allowed under its EA permit and is
permitted to process 22,000 tonnes of Li-ion batteries annually.
Following the commissioning, Recyclus focused on increasing
production volumes, securing a number of agreements with a range of
partners.
Recyclus has secured various key
agreements for the recycling of Li-ion batteries, including
partnerships with Servicesure Autocentres, which has a network of
more than 600 independent autocentres in the UK; Beryl, a UK-based
shared sustainable transport operator; and AA Recycling Limited,
which handles a wide range of battery chemistries from household to
industrial.
Further emphasising its global
reach, Recyclus has secured an offtake agreement with LOHUM,
India's leading producer of sustainable energy transition
materials, emphasising the ability to provide a cradle-to-cradle
solution for Li-ion batteries globally. The commencement of the
sale of black mass under the agreement with LOHUM has taken longer
than expected due to delays in progressing regulatory clearances
between the UK and Indian governments. Recyclus is in advanced
discussions for offtake agreements in the USA, Canada, Germany and
South Korea with global organisations. Once in place these
agreements will provide an additional international market for the
company's black mass.
Recyclus' commitment to innovation
was demonstrated when it won the Automotive Award at the Engineer's
Collaborate to Innovate for the Universal Battery Recycling
System.
Post period, in September 2024,
Recyclus completed a 10-week recycling programme, for a leading
engineering services and technology company, for 4,000 spent Li-ion
battery modules from electric vehicles , which were stored and
transported using LiBox containers.
In November 2024, Recyclus
announced it has secured an agreement with Halfords Group plc, the
UK's leading provider of motoring and cycling services and
products, to recycle waste Li-ion e-mobility batteries for an
initial period of 12 months.
LiBox Storage and Transportation
Recyclus has received orders for
its proprietary LiBox, designed for the safe transportation and
storage of hazardous battery materials. This innovation forms a key
part of Recyclus' comprehensive battery recycling services. The
LiBox order and delivery was made to automotive retailer Waylands,
which is using the boxes to store waste Li-ion batteries across its
Volvo outlets in Bristol, Reading and Oxford.
Post period, the company announced
it signed a supply agreement and delivered its first order from the
Ministry of Defence ("MOD") for its market-leading solution for the
safe storage and transportation of lithium-ion ("Li-ion")
batteries, LiBox.
Tipton (lead acid recycling)
Recyclus' Tipton lead acid battery
recycling plant began commissioning in October 2023 after receiving
EA clearance for automated operations. The facility can process up
to 12 tonnes of batteries per hour, with a fully automated system
that emits no particles or gases, recycling materials for various
industries and minimising environmental impact.
As stated previously, the
commissioning was paused to prioritise the Li-ion processing plant
in Wolverhampton. The Board has initiated a strategic review to
consider the future of the Tipton facility and assess the best
route forward, which could include potential joint venture
partnerships or the sale of the asset. The Company will update the
market as and when appropriate.
Cost Efficiencies and Board changes
Post period, the Company has taken
various measures to enhance efficiencies throughout the business,
amounting in a cost reduction programme. As such, the Company
reviewed its operations and have begun implementing measures across
the business to drive productivity efficiencies at all levels. This
included a reduction in the total workforce, head office costs and
an ongoing review of all service providers. Additionally, earlier this year, the Board conducted a review
of Directors' remuneration and decided to implement a temporary
salary freeze for all Directors until cash flows permit.
In September 2024, Phillip Beard
agreed to step down as an Independent Non-Executive Director and as
Chairman of the Remuneration Committee; Wilson Robb, Chief
Technical Officer, resigned from the board. The Board would like to
extend its thanks to both Phil and Wilson for their contributions
over the last few years and wish them both the best in their future
endeavours. The Board now consists of six directors and, as such,
the Company believes this is an optimal composition for the
business going forward.
Whilst the Board has reduced in
number from eight to six, members will continue to operate with
full independence. In order to prevent any conflict of interest,
Directors will continue to recuse themselves from discussions where
appropriate, allowing the remaining Board members to make decisions
in their absence.
Merger of Technology Minerals and Recyclus on
hold
The proposed merger between
Technology Minerals and Recyclus has been put on hold due to the
reverse takeover re-admission requirements of the London Stock
Exchange. Both companies have agreed to revisit the merger when
circumstances permit, and market conditions are more
favourable.
Recyclus is not consolidated as a
group company because, despite Robin Brundle and Alex Stanbury
being on the Boards of both companies, the Technology Minerals
Board has additional directors who do not have an interest in
Recyclus beyond Technology Minerals' 48.35% interest in its share
capital. As Robin Brundle and Alex Stanbury (being the directors of
Recyclus Group) do not vote on matters relating to Recyclus, the
management of the two groups is separate.
Financial Review
The Group had a year of good
progress, evidenced by proving the success of its incubator model
for developing its exploration assets and selling them where this
is in shareholders' interests. In April 2024, a binding head of
agreement to sell its Irish lithium assets was entered into,
leading to the completion of the sale in November 2024, for gross
consideration, before costs and settlement of obligations, of US$10
million in shares in a NASDAQ quoted company. The Company will be
able to trade its consideration shares from 28 February
2025.
During the year, the Company lent
a further £1.9 million to Recyclus Group Limited, an associate
company in which it has a 48.35% interest, during which period
Recyclus achieved commercial production at its Li-ion plant at
Wolverhampton, and final permitting for its lead-acid plant at
Halo, although the latter has been put on hold to enable resources
to be focused on the Li-ion at Wolverhampton. Li-ion production has
been gradually increasing over the period and the main recovered
product, black mass, has been accumulating ready for the first
shipments in Q4 2024. The total loan to Recyclus was £8.8 million
at year end including accrued interest and management charges. The
treatment of Recyclus as an associate company is set out in Note 5
to the Financial Statements.
In the period, the Company raised
£4.4 million from the issue of convertible bonds and loan notes,
including £2.5 million under a £5.5 million facility from Atlas
Capital of which, at the date of this report, £0.7 million has been
converted into Ordinary shares in the Company.
The Group's loss for the year was
£6.6 million (2023: £4.3 million (restated)), of which
administrative charges were £2.4 million (2023: £3.9 million
(restated)). Cash at year end was £0.015 million (2023: £0.3
million). Certain convertible loan notes are scheduled for
repayment in the coming year and the Company is considering its
financing options to enable it to meet agreed repayment schedules.
The Company is confident of cashflows from Recyclus in the coming
year from loan repayments and has undertaken cost reviews to reduce
its cash requirements. At the date of this report, Recyclus is
undertaking funding from third party investors which will reduce
the requirement for further loans from the Company.
The Group proposes to continue its
exploration and development work in the coming year on its minerals
exploration licences to maximise their value potential, although
proposed work will correspond with available cash resources. The
Group has entered into farm-in arrangements with third parties in
respect of certain licences whereby the assets are developed at no
cost to the Group and other similar arrangements will be considered
if beneficial.
The Group looks forward to a
strong coming year as it receives benefit from the sale of its
Irish lithium assets and as Recyclus increases li-ion battery
recycling.
Events since the year end
Post period, entered into a heads
of agreement, subject to conditions precedent, by which Bluebird
Metals LLC acquires a further 70% interest in the Company's cobalt
interest in Idaho, USA.
On 24 November 2024, the Group
signed an agreement to sell its Irish Lithium assets in return for
stock in a NASDAQ listed company, such shares being available for
sale from 28 February 2025. The gross amount of the sale before
costs and the settlement of obligations is US$10
million.
Dividend
The Board has not proposed a final
dividend for the year.
Risks
The Company has an established
process for the identification and management of risk, working
within the governance framework. Ultimately, the management of risk
is the responsibility of the Board of Directors and the Audit
Committee, working through the business leadership team. For
further detail please refer to the general risks laid out in the
Annual Report, published today.
Outlook
The Company is pleased to see its
strategy of advancing early-stage critical metal exploration
projects deliver positive outcomes, as demonstrated by the
successful sale of the Leinster project. By working with
exploration partners to develop Technology Mineral's diverse asset
portfolio, the Company can significantly enhance value while
minimising the more substantial costs typically associated with
project development. The Company remain confident that this
approach will continue to bring added value to Technology Minerals
and its shareholders.
The agreement with European
Lithium highlights the Company's ability to identify and develop
early-stage projects with substantial potential. It also
reinforces Technology Mineral's strategy of advancing projects up
the value curve and attracting buyers or partners to generate
additional value to the Company and its shareholders.
In addition to the Company's
exploration assets, Recyclus has seen a marked increase in
commercial activity as it scales up production at its Wolverhampton
facility. The company is in advanced discussions with several
potential industry partners, both domestically and internationally,
to further expand its operations. With Technology Minerals' 48.35%
holding, the Company has embedded value in Recyclus with potential
to bring significant additional value as the company ramps up its
operations and gains increased commercial traction.
Securing a reliable supply of
critical minerals, both through primary mineral extraction and
secondary recycling, will be essential for supporting the global
push towards electrification. Looking ahead, with the continued
progress in the Company's minerals exploration projects and the
exciting growth potential of Recyclus, Technology Minerals is well
positioned for the next phase of its development.
Publication of Annual Report and Accounts
The Company's Annual Report and
Accounts is being posted to shareholders and will be made available
on the Company's investor relations website at: www.technologyminerals.co.uk.
Update on Temporary Suspension of
Trading
The Company's listing had been
temporarily suspended pending publication of the Annual Report and
Accounts. Once the Annual Report and Accounts have been tagged and
converted to XHTML format with Inline XBRL mark up, as specified in
the UK Transparency Directive Regulation and DTR 4.1, they will be
uploaded to the National Storage Mechanism, following which, the
Company will apply for the restoration of the listing of its
shares.
Notes to
financial statements
1. General
information
Technology Minerals Plc (the
'Company') is a public limited company incorporated and domiciled
in England under the Companies Act 2006 with registration number
13446965.
The Company is listed on the main
market of the London Stock Exchange. The Company's registered
office is 18 Savile Row, London, England, W1S 3PW.
The nature of the Group's
operations and its principal activities are set out in the
Directors' Report.
2. Basis of
preparation
The principal accounting policies,
methods of computation and presentation used in the preparation of
the consolidated financial information are shown below. The
policies have been consistently applied to all the years presented,
unless otherwise stated.
Technology Minerals Plc's
consolidated financial statements are presented in Pounds Sterling
(£), which is also the functional currency of the parent company.
All amounts are rounded to nearest thousand.
There have been no changes to the
reported figures as a result of any new reporting standards or
interpretations.
The Group's financial statements
have been prepared in accordance with UK adopted international
accounting standards (IFRSs) in conformity with the requirements of
the Companies Act 2006.
The consolidated financial
statements have been prepared on the historical cost basis, except
for the measurement to fair value of assets and financial
instruments as described in the accounting policies below, and on a
going concern basis.
Going Concern
In March 2024, the Company entered
into a Convertible Bond Facility with Atlas Capital in the total
amount of £5.5 million, of which £2.5 million was drawn down at the
year end and of this, £0.7 million has been converted into ordinary
shares in the Company. Previously, the Company had drawn £0.6
million under a convertible bond facility with CLG Capital; at the
date of this report, the settlement of this amount, by conversion
into ordinary shares or in cash, was under negotiation following
delays in CLG providing funds due under the agreement.
At the date of this report, £2.9
million of convertible loan notes are due for repayment over the
next 12 months and the Company is considering its financing options
to enable it to meet agreed repayment schedules. The Company is
confident of cashflows from Recyclus in the coming year from loan
repayments and has undertaken a cost review to reduce its cash
requirements. At the date of this report, Recyclus is seeking
funding from third party investors which will reduce the
requirement for further loans from the Company.
On 24 November 2024, the Group
signed an agreement to sell its Irish Lithium assets in return for
stock in NASDAQ-listed Critical Metals Corp., such shares being
available for sale from 28 February 2025. The gross amount of the
sale before costs and the settlement of obligations is US$10
million and the Company expects to receive c.£3.1 million net of
capital gains tax in Ireland and after such costs, being introducer
commission, settlement of joint venture partner interests and other
related obligations subject to share price fluctuations.
The Directors have a reasonable
expectation that the Group's and the Company's cash resources will
be adequate to enable them to meet their planned expenditure for at
least 12 months from the date of approval of these consolidated
financial statements. In determining this expectation, the
Directors have considered their ability to raise additional funds
should they be required, as well as the likelihood and timing of
Recyclus Group loan repayments being received.
Although the Directors have been
successful in raising finance in the past, no assurance can be
given that funding will be available when it is required in future,
or that it will be available on acceptable terms. Recyclus Group
Ltd does not yet have a strong track record of repaying its loans
to the Company. In view of the foregoing, the Directors consider
that a material uncertainty exists as to the Group's and the
Company's ability to continue as a going concern.
Having carefully considered the
foregoing, the Directors nonetheless maintain their reasonable
expectation that the Group and the Company will be able to meet its
planned expenditure for at least 12 months from the date of
approval of these consolidated financial statements and the
consolidated financial statement have therefore been prepared on a
going concern basis.
In reaching this conclusion, the
Board has considered the magnitude of potential impacts resulting
from uncertain future events or changes in conditions, the
likelihood of their occurrence and the likely effectiveness of
mitigating actions that the Directors would consider
undertaking.
The Board continues to monitor the
impact of global conflict, including the Ukraine war, on the
ability of the Group and the Company to pursue the strategy and
will make appropriate changes should they be required. There is not
considered to be any material impacts on the financial position or
results of the Company or the Group as a result of the global
conflict at the reporting date.
The auditors have made reference
to going concern by way of a material uncertainty within their
audit report.
Basis of consolidation
The consolidated financial
statements incorporate the financial statements of the Company its
subsidiaries as if they formed a single entity. Subsidiaries are
entities over which the Group has control. Control exists when the
Company:
•
has power over the investee;
•
is exposed, or has rights, to variable returns
from its involvement with the investee; and
•
has the ability to use its power to affect its
returns.
On acquisition, in the statement of
financial position, the acquiree's identifiable assets, liabilities
and contingent liabilities are initially recognised at their fair
values if acquiring a business or assigned a carrying amount based
on relative fair value if acquiring an asset. The results of
acquired operations are included in the consolidated statement of
comprehensive income from the date on which control is obtained.
They are deconsolidated from the date on which control ceases.
Assets, liabilities, income and expenses of a subsidiary acquired
or disposed of during the year are included in the Group financial
statements from the date the Group gains control until the date the
Group ceases to control the subsidiary.
Investments in subsidiaries are
accounted for at cost less impairment within the Company financial
statements. Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used in
line with those used by other members of the Group.
All intragroup assets and
liabilities, equity, income, expenses and cash flows relating to
transactions between the members of the Group are eliminated on
consolidation.
Acquisitions and disposals of
non-controlling interests in subsidiaries that do not result in a
loss of control are accounted as transactions within equity. The
difference between the fair value of the consideration paid or
received and the amount by which the non-controlling interests are
adjusted is recognised in equity and attributed to equity holders
of the parent company.
3.
New standards, amendments and interpretations adopted by the
Company
The
following IFRS or IFRIC interpretations were effective for
the first time for the financial year beginning 1 July 2023.
Their adoption has not had any material impact on the disclosures
or on the amounts reported in this financial
information:
Standards/interpretations
|
Application
|
Effective from
|
IAS 12 amendments
|
Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
|
1 January 2023
|
IAS 1 amendments
|
Materiality of Accounting Policy
Disclosure
|
1 January 2023
|
IAS 1
|
Presentation of Financial
Statements
|
1 January 2023
|
IFRS 17
|
Insurance Contracts
|
1 January 2023
|
IAS 8 amendments
|
Definition of accounting
estimates
|
1 January 2023
|
IAS 1 amendments
|
Presentation of Financial
Statements
|
1 January 2024
|
IAS 1 amendments
|
Non-current liabilities with
covenants
|
1 January 2024
|
IFRS 16 (Amendments)
|
Lease liability in a sale and
leaseback
|
1 January 2024
|
Investment in subsidiaries
Investments in subsidiaries are
initially measured as cost and reviewed for impairment at each
reporting period. An investor controls an investee when the
investor is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect those
returns through its power over the investee. The financial
statements of subsidiaries are included in the consolidated
financial statements from the date that control is obtained up to
the date that control ceases.
Intra-group balances and any
unrealised gains, losses, income or expenses arising from
intra-group transactions are eliminated in preparing the
consolidated financial statements.
Investment in associates
Where the Group has the power to
participate in (but not control) the financial and operating policy
decisions of another entity, it is classified as an associate.
Associates are initially recognised in the consolidated statement
of financial position at cost. Subsequently associates are
accounted for using the equity method, where the Group's share of
post-acquisition profits and losses and other comprehensive income
is recognised in the consolidated statement of profit and loss and
other comprehensive income (except for losses in excess of the
Group's investment in the associate unless there is an obligation
to make good those losses).
Profits and losses arising on
transactions between the Group and its associates are recognised
only to the extent of unrelated investors' interests in the
associate. The investor's share in the associate's profits
and
losses resulting from these transactions is eliminated against the
carrying value of the associate.
Financial instruments
Financial assets
The Company classifies its
financial assets in the following measurement
categories:
•
those to be measured subsequently at fair value
through profit or loss;
•
those to be measured at amortised cost;
and
•
those to be measured at fair value through other
comprehensive income (FVTOCI).
The classification depends on the
business model for managing the financial assets and the contracted
terms of the cash flows. Financial assets are classified as at
amortised cost only if both of the following criteria are
met:
•
the asset is held within a business model whose
objective is to collect contracted cash flows; and
•
the contractual terms give rise to cash flows
that are solely payments of principal and interest.
Financial assets, including trade
and other receivables and cash and bank balances, are initially
recognised at transaction price, unless the arrangement constitutes
a financing transaction, where the transaction is measured at the
present value of the future receipts discounted at a market rate of
interest.
Such assets are subsequently
carried at amortised cost using the effective interest
method.
At the end of each reporting
period, financial assets measured at amortised cost are assessed
for objective evidence of impairment. If an asset is impaired, the
impairment loss is the difference between the carrying amount and
the present value of the estimated cash flows discounted at the
asset's original effective interest rate. The impairment loss is
recognised in the consolidated income statement.
If there is a decrease in the
impairment loss arising from an event occurring after the
impairment was recognised the impairment is reversed. The reversal
is such that the current carrying amount does not exceed what the
carrying amount would have been had the impairment not previously
been recognised. The impairment reversal is recognised in the
consolidated income statement.
Financial assets are derecognised
when (a) the contractual rights to the cash flows from the asset
expire or are settled, or (b) substantially all the risks and
rewards of the ownership of the asset are transferred to another
party or (c) despite having retained some significant risks and
rewards of ownership, control of the asset has been transferred to
another party who has the practical ability to unilaterally sell
the asset to an unrelated third party without imposing additional
restrictions.
On initial recognition, the Group
may make an irrevocable election (on an instrument-by-instrument
basis) to designate investments in equity instruments as at FVTOCI.
Investments in equity instruments at FVTOCI are initially measured
at fair value. Subsequently, they are measured at fair value with
net changes in fair value recognised in other comprehensive income.
Gains and losses on these financial assets are never recycled to
profit or loss.
Fair Value Measurement
Fair value is the price that would
be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement
date. The fair value of financial assets is determined based on the
fair value hierarchy which prioritises the inputs to valuation
techniques used to measure fair value into three broad
levels:
·
Level 1: Quoted prices (unadjusted) in active
markets for identical assets or liabilities.
·
Level 2: Inputs other than quoted prices included
within Level 1 that are observable for the asset or liability,
either directly (i.e., as prices) or indirectly (i.e., derived from
prices).
·
Level 3: Unobservable inputs for the asset or
liability.
The level in the fair value
hierarchy within which the fair value measurement is categorised in
its entirety is determined based on the lowest level input that is
significant to the entire measurement.
Financial Liabilities
Basic financial liabilities, being
trade and other payables, are initially recognised at transaction
price, unless the arrangement constitutes a financing transaction,
where the debt instrument is measured at the present value of the
future receipts discounted at a market rate of interest.
Trade payables are obligations to
pay for goods or services that have been acquired in the ordinary
course of business from suppliers. Accounts payable are classified
as current liabilities if payment is due within one year or less.
If not, they are presented as non-current liabilities. Trade
payables are recognised initially at transaction price and
subsequently measured at amortised cost using the effective
interest method.
Financial liabilities are
derecognised when the liability is extinguished, that is when the
contractual obligation is discharged, cancelled or expires. The
Company does not hold or issue derivative financial
instruments.
Assets held for sale
The Group classifies non-current
assets (or disposal groups) as held for sale when their carrying
amounts are expected to be recovered primarily through a sale
transaction rather than through continuing use. Such assets or
disposal groups are measured at the lower of their carrying amount
and fair value less costs to sell and are not depreciated or
amortised once classified as held for sale. The classification and
measurement of assets held for sale are carried out in accordance
with IFRS 5 - Non-current Assets Held for Sale and Discontinued
Operations. The Group has determined that its wholly owned
subsidiary LRH Resources Ltd (LRH) is classified as held for sale.
See note 20.
Criteria for Classification as Held for Sale
A non-current asset (or disposal
group) is classified as held for sale if it meets the following
conditions:
1.
The asset (or
disposal group) is available for immediate sale
in its present condition, subject
only to terms that are usual and customary for
such sales.
2. The sale is
highly probable. For the
sale to be highly probable, the following conditions must be
met:
·
Management is committed to a plan to sell the
asset (or disposal group).
·
An active program to locate a buyer and complete
the plan has been initiated.
·
The asset (or disposal group) is being actively
marketed for sale at a price that is reasonable in relation to its
current fair value.
·
The sale is expected to be completed within one year from the date
of classification.
·
Actions required to complete the sale indicate
that it is unlikely that significant changes to the plan will be
made or that the plan will be withdrawn.
Measurement of Assets Held for Sale
Upon classification as held for
sale, non-current assets (or disposal groups) are measured at the
lower of:
·
Their carrying amount before classification as
held for sale, or
·
Fair value less costs to sell.
If the carrying amount of the
asset (or disposal group) exceeds its fair value less costs to
sell, an impairment loss is
recognised in the income statement. Gains are only recognised to
the extent that they reverse previously recognised losses on the
same asset.
Disposal of the Asset (or Disposal Group)
When a sale is completed, the
Group derecognises the asset (or disposal group) and recognises any
resulting gain or loss on disposal in the income statement. The
gain or loss is calculated as the difference between the carrying
amount of the asset (or disposal group) and the sale proceeds, less
costs to sell.
Reclassifications and Changes in Plans
If the criteria for classification
as held for sale are no longer met, the Group ceases to classify
the asset (or disposal group) as held for sale. The asset (or
disposal group) is remeasured at the lower of:
· Its
carrying amount before classification as held for sale, adjusted
for any depreciation or amortisation that would have been
recognised had the asset not been classified as held for sale,
and
· Its
recoverable amount at the
date of the subsequent decision not to sell.
Foreign currency
Foreign currency transactions
Transactions in foreign currencies
are translated at the foreign exchange rate ruling at the date of
the transaction. Monetary assets and liabilities denominated in
foreign currencies at the date of the consolidated statement of
financial position are translated at the foreign exchange rate
ruling at that date. Foreign exchange differences arising on
translation are recognised in profit or loss.
Non-monetary assets and
liabilities that are measured in terms of historical cost in a
foreign currency are translated using the exchange rate at the date
of the transaction. Non-monetary assets and liabilities denominated
in foreign currencies that are stated at fair value are translated
at foreign exchange rates ruling at the dates the fair value was
determined.
Financial statements of foreign operations
The
assets and liabilities of foreign operations, including goodwill
and fair value adjustments arising on consolidation, are translated
to Pound Sterling at exchange rates ruling at the date of the
consolidated statement of financial position. The revenues and
expenses of operations are translated to Pound Sterling at rates
approximating to the exchange rates ruling at the dates of
the transactions. Foreign exchange differences arising on
retranslation are recognised in other comprehensive income. They
are reclassified to profit or loss upon disposal.
On disposal of a foreign
operation, the cumulative exchange differences recognised in the
foreign exchange reserve relating to that operation up to the date
of disposal are reclassified to the profit or loss as part of the
profit or loss on disposal.
Current and deferred income tax
Current income tax is calculated
on the basis of the tax laws enacted or substantively enacted at
the statement of financial position date in the country where the
Company operates and generates taxable income. Management
periodically evaluates positions taken in tax returns with respect
to situations in which applicable tax regulation is subject to
interpretation and establishes provisions where appropriate on the
basis of amounts expected to be paid to the tax
authorities.
Deferred income tax is provided in
full, using the liability method, on temporary differences arising
between the tax bases of assets and liabilities and their carrying
amounts in the financial information. Deferred income tax is
determined using tax rates (and laws) that have been enacted or
substantively enacted by the statement of financial position date
and are expected to apply when the related deferred income tax
asset is realised, or the deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is
probable that future taxable profit will be available against which
the temporary differences can be utilised.
Earnings per share
The Group presents basic and
diluted earnings per share ("EPS") data for its ordinary shares.
Basic EPS is calculated by dividing the profit or loss attributable
to shareholders of the Company by the weighted average number of
ordinary shares outstanding during the period.
Property, plant and equipment
Property, plant and equipment are
stated at cost less accumulated depreciation. Depreciation is
charged to the income statement on a straight-line basis over the
estimated useful lives of each part of an item of property, plant
and equipment.
Office equipment is depreciated
straight line over three years.
Intangible assets
Intangible assets not acquired as
part of an asset acquisition are initially carried at cost. The
consideration paid is allocated to assets and liabilities acquired
based on their relative fair values, with transaction costs
capitalised. No gain or loss is recognised.
Intangible assets acquired as part
of a business combination, and separately recognised from goodwill,
are capitalised and measured at their fair value at the date of
acquisition.
Consideration paid in the form of
equity instruments is measured by reference to the fair value of
the asset acquired. The fair value of the assets acquired would be
measured at the point control is obtained.
Exploration and evaluation costs
These
comprise costs directly incurred in exploration and evaluation as
well as the cost of mineral licences. Mineral evaluation and
exploration costs which are capitalised as intangible assets
include costs of licence acquisition, technical services and
studies, exploration drilling and testing and appropriate technical
and administrative. Exploration costs are capitalised as intangible
assets pending the determination of the feasibility and the
commercial viability of the project.
When the decision is taken to
develop a mine, the related intangible assets are transferred to
mines under development within property, plant and equipment and
the exploration and evaluation costs are amortised over the
estimated life of the project upon commercial production. Prior to
reclassification to property, plant and equipment exploration and
evaluation assets are assessed for impairment and any impairment
loss is recognised immediately in the statement of comprehensive
income.
Where a project is abandoned or is
determined not economically viable, the related costs are written
off.
The recoverability of deferred
exploration and evaluation costs is dependent upon a number of
factors common to the natural resource sector. These include the
extent to which the Company can establish mineral reserves on its
properties, the ability of the Company to obtain necessary
financing to complete the development of such reserves and the
future profitable production or proceeds from the disposition
thereof.
Impairment of non-financial assets
The carrying amounts of the
Group's assets are reviewed at the date of each consolidated
statement of financial position to determine whether there is any
indication of impairment. If any such indication exists, the
asset's recoverable amount is estimated. Impairment is measured by
comparing the carrying values of the asset with its recoverable
amount. The recoverable amount of the asset is the higher of the
asset's fair value less costs to sell and its value-in-use, which
is measured by reference to discounted future cash flow.
An impairment loss is recognised
in the income statement immediately.
When there is a change in the
estimates used to determine the recoverable amount, a subsequent
increase in the recoverable amount of an asset is treated as a
reversal of the previous impairment loss and is recognised to the
extent of the carrying amount of the asset that would have been
determined (net of amortisation and depreciation) had no impairment
loss been recognised. The reversal is recognised in the income
statement immediately, unless the asset is carried at its revalued
amount, in which case the reversal of the impairment loss is
treated as a revaluation increase.
Trade and other receivables
Trade and other receivables are
recognised initially at their fair value and subsequently measured
at amortised cost using the effective interest
method.
Cash and cash equivalents
Cash and cash equivalents comprise
cash in hand, demand deposits, and other short-term highly liquid
investments that are readily convertible to a known amount of cash
and are subject to an insignificant risk of changes in value. The
carrying amount of these assets approximates their fair
value.
Trade and other payables
Trade and other payables are
recognised initially at their fair value and subsequently measured
at amortised cost using the effective interest method.
Borrowings
Interest bearing debt facilities
are initially recognised at fair value, net of directly
attributable transaction costs. Transaction costs are recognised in
the income statement on a straight-line basis over the term of the
facility.
Borrowings with embedded derivative
Borrowings with embedded derivative liability held at fair
value through profit and loss ('FVTPL')
Convertible debt with an embedded
derivative liability pertains to borrowing where the holder has the
right to convert the debt into a variable number of shares of the
Company or a variable cash amount, such that the conversion feature
does not meet the definition of equity under IAS 32 'Financial
Instruments: Presentation'.
Initial recognition
The convertible debt is initially
recognised by separating it into the host contract and the embedded
derivative. The embedded derivative is measured at its fair value
at initial recognition. The value of the host contract is
determined as the difference between the proceeds received (net of
transaction costs directly attributable to the issuance of the
instrument) and the fair value of the embedded
derivative.
Subsequent measurement
·
Liability Component (Host Contract): After initial
recognition, the liability component of the convertible debt
(excluding the embedded derivative) is measured at amortised cost
using the effective interest method. Interest expense, as
calculated using the effective interest rate, is recognised in
profit or loss.
·
Embedded Derivative Liability: The embedded
derivative is measured at fair value using a Monte Carlo based
option pricing model for the convertible loans issued to ACM and
CLG, with changes in fair value recognised immediately in
profit or loss. The derivative is revalued at each reporting
date.
Conversion
·
If the conversion option is exercised, the
carrying amount of the liability component and the fair value of
the embedded derivative at the date of conversion are transferred
to equity, assuming the shares are issued. Any difference between
the combined carrying amount and the number of shares issued
multiplied by the share price at the conversion date is recognised
in profit and loss.
·
If the bondholders choose not to convert and the
debt matures, the embedded derivative is derecognised and settled
together with the host contract.
Equity-classified borrowings with embedded
derivative
Borrowings with embedded
derivatives classified as equity refer to debt instruments that
include a derivative component allowing for conversion into a fixed
number of the Company's own equity instruments in exchange for a
fixed principal amount, such a conversion feature meets the
definition of an equity instrument, rather than a financial
liability.
Initial Recognition and Measurement
At initial recognition, the
borrowing is separated into two components: (i) the liability
component, which reflects the present value of future cash flows of
the debt, and (ii) the equity component, representing the embedded
derivative that allows conversion into equity. The equity component
is recorded in a separate reserve within equity.
Subsequent Measurement
The liability component is
subsequently measured at amortised cost using the effective
interest method. The equity component is not remeasured after
initial recognition, in accordance with IAS 32.
Conversion
Upon conversion of the borrowing
into the Company's equity instruments, the carrying amount of the
liability component and the equity component are transferred to
share capital and share premium, as applicable.
Equity instruments and reserves description
An equity instrument is any
contract that evidences a residual interest in the assets of the
Company after deducting all its liabilities. Equity instruments
issued by the Company are recorded at the proceeds received net of
direct issue costs.
Ordinary shares are classified as
equity and rank in full for all dividends or other distributions
declared, made or paid on the ordinary share capital of the
Company.
Share capital account represents
the nominal value of the ordinary shares issued.
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, net of any related income
tax benefits.
Warrant reserve represents
equity-settled share-based payments made to third parties until
such warrants are exercised. Only equity-settled share-based
payments that will be settled by the Company exchanging a fixed
amount of cash (or another financial asset) for a fixed number of
its own equity instruments will be included in the Warrant
reserve.
The convertible loan reserve
represents the equity component of convertible loan instruments
issued by the Company. This reserve arises from instruments that
can be converted into a fixed number of the Company's own equity
instruments in exchange for a fixed principal amount, reflecting an
equity-settled component in accordance with IAS 32 Financial
Instruments: Presentation. The reserve is recorded at initial
recognition of the convertible instrument and remains in equity
until the conversion option is exercised or the instrument is
redeemed. Upon conversion, the related balance in the reserve is
transferred to share capital and share premium as applicable; if
the instrument is redeemed, the reserve balance is transferred to
retained earnings.
Share-based payment reserve
represents equity-settled share-based payments made to directors
and employees until such share-based payments are
exercised.
Foreign exchange reserve
represents:
·
differences arising on the opening net assets
retranslation at a closing rate that differs from opening rate;
and
·
differences arising from retranslating the income
statement at exchange rates at the dates of transactions at average
rates and assets and liabilities at the closing rate.
Retained earnings include all
current and prior period results as disclosed in the Statement of
Comprehensive Income.
Warrants
The Company estimates the fair
value of share warrants using the Black-Scholes pricing model
considering the terms and conditions upon which the warrants were
issued. Warrants relating to equity finance are recorded as a
reduction of capital stock based on the fair value of the
warrants.
Share-based payments
Equity-settled share-based
payments to employees and others providing similar services are
measured at the fair value of the equity instrument at the grant
date. Fair value is measured by use of the Black-Scholes model.
Where the value of the goods or services received in exchange for
the share-based payment cannot be reliably estimated the fair value
is measured by use of a Black-Scholes model.
The fair value determined at the
grant date of the equity-settled share-based payments is expensed
on a straight-line basis over the vesting period, based on the
Group's estimate of shares that will eventually vest.
Equity-settled share-based payment
transactions with other parties are measured at the fair value of
the goods and services received, except where the fair value cannot
be estimated reliably, in which case they are measured at the fair
value of the equity instruments granted, measured at the date the
entity obtains the goods or the counterparty renders the
service.
All equity-settled share-based
payments are ultimately recognised as an expense in the profit or
loss with a corresponding credit to "Share-based payments
reserve".
Upon exercise of share options,
the proceeds received net of attributable transaction costs are
credited to share capital, and where appropriate share premium. No
adjustment is made to any expense recognised in prior periods if
share options ultimately exercised are different to that estimated
on vesting or if the share options vest but are not
exercised.
When share options lapse or are
forfeited the respective amount recognised in the Share-based
payment reserve is reversed and credited to accumulated profit and
loss reserve.
4. Financial
risk
The following represent the key
financial risks that the Company faces:
Financial risk factors
The Company's operations exposed
it to a variety of financial risks that had included the effects of
credit risk, liquidity risk and interest rate risk. The Company had
in place a risk management programme that attempted to limit the
adverse effects on the financial performance of the Company by
monitoring levels of debt finance and the related finance costs.
The Company did not use derivative financial instruments to manage
interest rate costs and as such, no hedge accounting was
applied.
Given the size of the Company, the
Directors did not delegate the responsibility of monitoring
financial risk management to a sub-committee of the Board. The
policies set by the Board of Directors were implemented by the
Company's finance department:
(a) Credit risk
The Company's credit risk was
primarily attributable to its trade receivables balance. The
amounts presented in the statement of financial position are net of
allowances for impairment.
(b) Liquidity risk
Liquidity risk was the risk that
an entity will encounter difficulty in meeting obligations
associated with financial liabilities. The Company's financial
liabilities included its trade and other payables shown in
Note 23;
(c) Interest rate cash flow
risk
The Company had interest-bearing
assets. Interest-bearing assets comprised cash balances and
unsecured loans, which earned interest at floating rates. See note
28.
Capital risk management
The Company monitors capital which
comprises all components of equity (i.e., share capital, share
premium and retained earnings/losses). See note 28
5. Critical accounting estimates and
judgements
The preparation of the financial
statements require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the
end of the reporting period. Estimates and judgements are
continually evaluated based on historical experience and other
factors, including expectations of future events that are believed
to be reasonable under the circumstances. In the future, actual
experience may differ from these estimates and
assumptions.
Information about such judgements
and estimates are contained in the accounting policies and/or the
notes to the consolidated financial statements. Areas of judgement
that have the most significant effect on the amounts recognised in
the consolidated financial statements are as follows:
Recyclus Accounted for as an Associated
Company
The Company, considering IAS 28 -
Investments in Associates and
Joint Ventures and IFRS 10 -
Consolidated Financial Statements, has
determined that whilst it does have significant influence over
Recyclus it does not control and direct it, and the directors of
Recyclus who are also directors of the Company are excluded from
any Company decisions relating to Recyclus. Therefore, the Company
believes that it is reasonable to account for Recyclus as an
associated company.
The Company is in correspondence with the Financial Reporting
Council ("FRC") in respect of the Company's financial statements
for the year ended 30 June 2023 regarding the treatment of Recyclus
as an Associate company, and in respect of the accounting treatment
of loans made to Recyclus. As set out in Note 18 to the financial
statements, the Company has treated Recyclus as an Associate
company as it has judged that it does not control Recyclus and has
also announced that it is not currently pursuing the takeover of
Recyclus as it would not be able to meet the reverse takeover
re-listing rules of the London Stock Exchange.
In respect of the loans made to Recyclus, when the loan agreement
was entered into in 2021 interest rates were low and it was judged
that no equity portion of the loan was required to be recognised.
Since then, as set out in Note 19, due to interest rate
differentials in the market and considering Company borrowing
costs, the Company has assessed that it is fair for a portion of
these loans to be classified as equity in accordance with IFRS 9 in
the current year, and to make an adjustment to the prior
year.
Valuation of warrants and share options - see note
25
The Company estimates the fair value of the future liability
relating to issued warrants and share options using the
Black-Scholes pricing model taking into account the terms and
conditions upon which the warrants and share options were issued,
if the warrant or share option was granted on its own.
Loan to associate- see note 19
Determination
as to whether, the loan to associate is recoverable involves
management estimates and judgement. Management reviewed the
cashflow forecasts of the associate to determine whether an
impairment of the loan is required. The Company has considered a
range of sensitivities in respect of sales, cost of sales and
discount rates and has assumed that the relevant
environmental permits will be issued to enable the achievement of
sales. The Company has concluded that there is considerable
headroom over the carrying value of the loan provided commercial
production can be achieved.
Equity Element of Loans to Associates (IFRS
9)
The loan provided to the associate
has been split into debt and equity components in accordance with
IFRS 9 (Financial Instruments). Determining the split between the
loan's debt and equity components involves estimating the present
value of future cash flows and selecting an appropriate discount
rate. For the years ended 30 June 2024 and 30 June 2023, the
company used a 20% discount rate, being the estimated interest rate
that the company would be charged for borrowings with no conversion
premium. For the year ended 30 June 2022 the company used a
discount rate of 12% being the estimated return on its equity as
the Company had no borrowings during that year.
The company has also made a prior
year adjustment to account for the equity component of the loan in
the financial statements for the years ended 30 June 2022 and 30
June 2023, which was not recognised in prior periods. This
adjustment is discussed in Note 31
and Note 19.
Unquoted financial assets - see note 16
The Company holds certain unquoted
investments which are held at fair value through other
comprehensive income in the financial statements. The determination
of whether the carrying amount of these investments, currently
being cost, approximates their fair value requires significant
estimates and judgments by management. The following describes the
basis and considerations made by management in this
determination:
Operating activities and future plans of the
Investee: Management reviewed the
operating activities and future plans of the investees. The
information provided evidence to support the view that the fair
value has not significantly changed from cost.
Market and Economic Indicators: Management considered relevant market and economic
indicators, industry trends, and other macroeconomic factors that
might impact the fair value of the investments.
Impairment Indicators: Management continuously evaluates for any indications of
impairment. If there were any external or internal indicators
suggesting that the investment might be impaired, a detailed
impairment assessment would be undertaken.
Based on the above considerations
and the information available, management determined that the
carrying amount of the unquoted investments in the financial
statements as at 30 June 2024 should be impaired as
follows:
My Club Betting (MCB) - having
reviewed the carrying value of MCB and taking into account the last
price at which the company has raised funds, the carrying value has
been impaired to £30k.
Dunraven - Whilst the economics of
the oil licences held by Dunraven are strong, there are impairment
indicators and therefore the Company has impaired 100% of the value
of its holding pending Dunraven securing funding and licence
renewals.
Impairment of exploration and evaluation costs - see note
15
Determination as to whether, and by how much, an asset or cash
generating unit is impaired involves management estimates.
Management uses the following triggers to assess whether impairment
has occurred (the list is not exhaustive):
•
The period for which the entity has the right to
explore in the specific area has expired during the period or will
expire in the near future and is not expected to be
renewed.
•
Substantive expenditure on further exploration
for and evaluation of mineral resources in the specific area is
neither budgeted nor planned.
•
Exploration for and evaluation of mineral
resources in the specific area have not led to the discovery of
commercially viable quantities of mineral resources and the entity
has decided to discontinue such activities in the specific
area.
•
Sufficient data exist to indicate that, although
a development in the specific area is likely to proceed, the
carrying amount of the exploration and evaluation asset is unlikely
to be recovered in full on successful development or by
sale.
The Management used the above
triggers to evaluate each mineral exploration licence held by the
group and determined carrying value of the mineral exploration
licences did not need to be impaired.
Assets held for sale - see note 20
The classification of assets (or
disposal groups) as held for sale involves the use of significant
judgements in assessing whether the criteria set out under IFRS 5 -
Non-current Assets Held for Sale and Discontinued Operations are
met. For the financial year ended 30 June 2024, management has
applied critical judgements to determine whether a specific
disposal group should be classified as held for sale based on the
status and timing of a negotiated sale agreement.
Assessment of Sale Probability and Timing
Management has exercised judgement
in determining whether the sale of LRH Resources Ltd ('LRH') is
highly probable as at 30 June 2024. The following factors were
considered:
·
Binding Heads of
Terms Signed in April 2024: A
binding heads of terms agreement (HoT), outlining the key
commercial terms and conditions of the sale, was signed in April
2024. This formalised commitment by both parties indicates that the
sale was highly probable as at 30 June 2024.
·
SPA Signed in
October 2024: Although the formal
Sale and Purchase Agreement ('SPA') was signed in October 2024,
after the reporting date, the key terms (including purchase price,
significant conditions, and timeline) were already agreed and
documented in the HoT. This indicates that the SPA execution was a
procedural formality, and management's commitment to sell LRH
existed as of 30 June 2024.
·
Management's
Commitment to Sell: The Group
demonstrated a clear commitment to sell by initiating an active
plan to locate a buyer, with no indications of significant changes
or delays in the plan.
·
Expected
Completion: The sale is expected to
be completed within one year from the classification date,
satisfying the timing requirement of IFRS 5.
Based on these factors, management
concluded that as of 30 June 2024, the criteria for classification
as held for sale were met, even though the SPA was signed
post-reporting date. Therefore, the disposal group has been
classified as held for sale as at 30 June 2024.
Measurement at Fair Value Less Costs to
Sell
Upon classification as held for
sale, LRH is measured at the lower of its carrying amount of £878k
(total assets of £905k less total liabilities of £27k) and fair
value less costs to sell. Given the binding nature of the HoT
signed in April 2024, management used the agreed-upon sale price of
US$10m in the HoT as a basis for estimating fair value, adjusted
for directly attributable costs to sell, such as legal and
transaction fees. Therefore, the carrying value used for LRH is
£878k.
Judgement in Determining Discontinued
Operations
IFRS 5 requires a disposal group
to be classified as a discontinued operation if it represents a
separate major line of business or a geographical area of
operations that is material to the Group's overall financial
performance. Management has applied significant judgement to assess
whether the sale of the subsidiary constitutes a discontinued
operation.
For the year ended 30 June 2024,
management concluded that the subsidiary does qualify as a
discontinued operation because it represents the disposal of a
separate major line of business being the Group's Lithium
exploration activities in Ireland. See note 20.
Impact of Judgements and Estimates
The judgements applied in
classifying LRH as held for sale and measuring fair value less
costs to sell can significantly impact the financial position and
results for the year ended 30 June 2024. Any changes in the terms
of the sale, expected costs, or market conditions could lead to
material adjustments to the carrying value and presentation of LRH
in future periods.
Judgement Applied in Classification of Derivative as Equity
or Liability
The Group issues convertible loans
(CLNs) with embedded derivative features, which necessitates
significant judgement in determining the classification of the
derivative as either equity or a financial liability. This
judgement considers the contractual terms of the conversion option,
assessing whether the derivative meets the criteria for
classification as equity. Where classified as a derivative
financial liability (DFL), it is held at fair value through profit
or loss (FVTPL), whereas derivatives classified as equity are not
remeasured after initial recognition.
Judgement Applied in Selection of Valuation
Method
For convertible loans where the
embedded derivative is classified as equity, the Group applies a
net present value (NPV) approach to the valuation of the CLN.
Conversely, for CLNs where the embedded derivative is classified as
a financial liability, an option-pricing model is applied to
determine fair value, considering the complex terms and variability
of the conversion feature.
Estimation Applied in Valuation of Derivative Financial
Liability
For CLNs classified as containing
a DFL held at FVTPL, the Group uses a Monte Carlo simulation model
to estimate the fair value of the DFL on initial recognition, at
each reporting date, and upon conversion events. This approach is
deemed appropriate due to the simulation's ability to model a range
of possible outcomes, capturing the inherent variability in
conversion terms and share price volatility. Key inputs in the
Monte Carlo model include the Company's share price, share price
volatility, the risk-free interest rate, and assumptions regarding
the timing and probability of conversion.
Changes in any of these
assumptions may significantly impact the fair value of the
derivative liability, potentially resulting in profit or loss
variations. Management regularly reassesses these inputs, utilising
historical data and market-based assumptions to ensure that the
fair value estimation reflects the economic substance of the
convertible instrument.
6. Operating
Segments
In accordance with IFRS 8
'Operational Segments,' the Group determines and presents operating
segments based on the information that is provided internally to
the Executive Directors, who are the Group's chief operating
decision makers ("CODM"). The operating segments are aggregated if
they meet certain criteria.
Identification of
Segments:
An operating segment is a
component of the Group that engages in business activities from
which it may earn revenues and incur expenses, including revenues
and expenses that relate to transactions with any of the Group's
other components, and is:
a) Expected to
generate revenues and incur expenses.
b) Regularly
reviewed by the CODM to make decisions about resources to be
allocated to the segment and assess its performance.
c) For which
discrete financial information is available.
Based on the above criteria, the
Group has identified its reportable segments as:
·
Mineral Exploration: This segment is engaged in
the exploration and assessment of mineral deposits.
·
Battery Recycling: This segment is involved in the
recycling of batteries to recover valuable materials.
·
Other: This segment includes expenditure,
corporate assets and corporate liabilities that are managed on a
group basis, including the loan to its associate undertaking,
Recyclus Group Ltd.
Measurement:
The CODM assesses the performance
of the operating segments based on a measure of operating
profit/loss. Interest income and expenditure are not included in
the results for each operating segment that is reviewed by the
CODM.
Below is a summary of the Group's
results, assets and liabilities by reportable segment as presented
to the Executive Board.
|
Mineral
exploration
|
Battery
recycling
|
Other
|
Total
|
|
£000
|
£000
|
£000
|
£000
|
Year ended 30 June 2024:
|
|
|
|
|
Operating expenses
|
(354)
|
(887)
|
(5,388)
|
(6,629)
|
Total segment operating loss
|
(354)
|
(887)
|
(5,388)
|
(6,629)
|
|
|
|
|
|
Year ended 30 June 2023 (as
restated):
|
|
|
|
|
Operating expenses
|
(281)
|
(736)
|
(3,300)
|
(4,317)
|
Total segment operating
loss
|
(281)
|
(736)
|
(3,300)
|
(4,317)
|
|
|
|
|
|
Total segment assets
|
|
|
|
|
At
30 June 2024
|
15,197
|
-
|
8,376
|
23,573
|
At 30 June 2023 (as
restated)
|
15,359
|
-
|
7,239
|
22,598
|
|
|
|
|
|
Total segment liabilities
|
|
|
|
|
At
30 June 2024
|
(33)
|
-
|
(8,188)
|
(8,221)
|
At 30 June 2023
|
(37)
|
-
|
(2,188)
|
(2,225)
|
Included in the Mineral
exploration segment in total segment assets is intangible asset
additions of £406k (FY2023: £420k). There were no other intangible
asset additions in other segments.
7.
Administrative expenses
|
2024
|
2023
|
£000
|
£000
|
Legal and professional
fees
|
1,143
|
536
|
Employee benefit expense
|
674
|
689
|
Share-based payment
charge
|
102
|
2,218
|
Advertising and marketing
|
189
|
312
|
Audit and Tax
|
68
|
65
|
Depreciation
|
2
|
1
|
Other administrative
expenses
|
230
|
35
|
|
2,408
|
3,856
|
8. Auditors'
remuneration
|
2024
|
2023
|
£000
|
£000
|
|
|
|
Fees payable for the audit of the
Group
|
84
|
65
|
|
84
|
65
|
9.
Employees and Directors
During the period key management personnel were the Directors of
the Company.
The average number of persons employed by the Company during the
period (including Directors that receive remuneration) was 5 (2023:
5).
The following table sets out the total employee and Director
costs.
|
2024
|
2023
|
£000
|
£000
|
Director and consulting
fees
|
614
|
605
|
Wages and salaries
|
-
|
6
|
Share based payment
charge
|
102
|
2,218
|
Social security costs
|
60
|
78
|
|
776
|
2,907
|
The Directors' remuneration is set
out in the Directors' Remuneration Report on page
41.
10. Other
income
|
2024
|
2023
|
£000
|
£000
|
Management fees
|
17
|
47
|
|
61
|
47
|
11.
Finance income and other finance costs
Finance income
|
2024
|
As
restated
2023
|
£000
|
£000
|
Interest charged to related
parties
|
550
|
535
|
Fair value movement on derivative
financial liability
|
-
|
128
|
|
550
|
663
|
The loan to associate has an annual
interest rate of 2.5%.
Finance charges
|
2024
|
2023
|
£000
|
£000
|
Interest payable
|
618
|
72
|
Unwinding of discount on convertible
loans inclusive of loan fees
|
799
|
322
|
Fair value movement on derivative
financial liability
|
1,132
|
-
|
|
2,549
|
394
|
12.
Taxation
|
2024
|
As
restated
2023
|
£000
|
£000
|
Current tax
|
-
|
-
|
Deferred tax
|
-
|
-
|
Total income tax expense
|
-
|
-
|
|
2024
|
As
restated
2023
|
£000
|
£000
|
Loss before tax from continuing
operations
|
(6,642)
|
(4,313)
|
Profit/(loss) before tax from
discontinued operations
|
13
|
(4)
|
Loss for the year
|
(6,629)
|
(4,317)
|
|
|
|
Tax using the Company's domestic tax
rate 25% (20.5%)
|
(1,657)
|
(885)
|
Effect of non-deductible
expenses
|
545
|
455
|
Utilisation of tax losses
|
(5)
|
-
|
Differences in overseas tax
rates
|
5
|
(2)
|
Tax losses carried
forward
|
1,112
|
432
|
Total tax expense
|
-
|
-
|
Effective tax rate
The effective tax rate was 25%
(2023: 20.5%). Tax charges are affected by the mix of profits and
tax jurisdictions in which the Group operates. The impact of
unrecognised tax losses and non-deductible items increases the
Group's overall effective tax rate.
At the year end, the Group had
estimated tax losses of £8,699,000 (2023 as restated: £5,118,000)
available for carry forward against future trading profits. As
legislation has been enacted whereby the corporation tax rate is
25% from April 2023, the tax losses would have resulted in an
additional deferred tax asset of £2,175,000 (2023 as restated:
£1,280,000) which has not been recognised in the financial
statements due to the uncertainty of the recoverability of the
amount.
13. Earnings per
share
Basic earnings per share is
calculated by dividing the loss attributable to equity holders of
the Company by the weighted average number of ordinary shares in
issue during the period.
|
2024
|
As
restated
2023
|
£000
|
£000
|
Profit/(loss) for the year
attributable to equity holders of the company
|
|
|
Continuing operations
|
(6,641)
|
(4,302)
|
Discontinued operations
|
13
|
(4)
|
Total operations
|
(6,628)
|
(4,306)
|
Weighted average number of ordinary
shares in issue
|
1,527,518,534
|
1,344,710,781
|
|
|
|
Basic and fully diluted loss per
share in pence
|
|
|
- from continuing
operations
|
(0.43)
|
(0.32)
|
- from discontinued
operations
|
-
|
-
|
Total operations
|
(0.43)
|
(0.32)
|
As the Company has not generated a
net profit for either the reporting period or the prior year,
diluted EPS is not stated.
14.
Property, plant and equipment - Group
Cost
|
|
Office
equipment
£000
|
Total
£000
|
1 July 2022
|
|
8
|
8
|
Additions
|
|
-
|
-
|
30 June 2023
|
|
8
|
8
|
Additions
|
|
2
|
2
|
30
June 2024
|
|
10
|
10
|
|
|
|
|
Depreciation
|
|
|
|
1 July 2022
|
|
3
|
3
|
Depreciation charge
|
|
1
|
1
|
30
June 2023
|
|
4
|
4
|
Depreciation charge
|
|
1
|
1
|
30
June 2024
|
|
5
|
5
|
|
|
|
|
Net
book value 30 June 2024
|
|
5
|
5
|
Net book value 30 June
2023
|
|
4
|
4
|
Property, plant and equipment - Company
Cost
|
|
Office
equipment
£000
|
Total
£000
|
1 July 2022
|
|
-
|
-
|
Additions
|
|
3
|
3
|
30 June 2023
|
|
3
|
3
|
Additions
|
|
2
|
2
|
30
June 2024
|
|
5
|
5
|
|
|
|
|
Depreciation
|
|
|
|
1 July 2022
|
|
-
|
-
|
Depreciation charge
|
|
1
|
1
|
30 June 2023
|
|
1
|
1
|
Depreciation charge
|
|
1
|
1
|
30
June 2024
|
|
2
|
2
|
|
|
|
|
Net
book value 30 June 2024
|
|
3
|
3
|
Net book value 30 June
2023
|
|
2
|
2
|
15.
Intangible assets
Cost
|
Mineral
exploration
£000
|
Total
£000
|
1 July 2022
|
15,409
|
15,409
|
Additions
|
420
|
420
|
FX
|
(40)
|
(40)
|
Disposals
|
-
|
-
|
30
June 2023
|
15,789
|
15,789
|
Additions
|
406
|
406
|
FX
|
(8)
|
(8)
|
Transferred to asset held for
sale
|
(889)
|
(889)
|
Impairment
|
(163)
|
(163)
|
Disposals
|
-
|
-
|
30
June 2024
|
15,135
|
15,135
|
Accumulated amortisation
|
|
|
1 July 2022 and 1 July
2023
|
-
|
-
|
Amortisation
|
-
|
-
|
30 June 2024
|
-
|
-
|
|
|
|
Net
book value 30 June 2024
|
15,135
|
15,135
|
Net book value 30 June
2023
|
15,789
|
15,789
|
In April 2024 the Group signed a
binding head of agreement to sell its interest in exploration
licences in Leinster, Republic of Ireland. This is envisaged to be
affected by the sale of 100% of the issued share capital of LRH
Resources Limited ("LRH") held by the Company to European Lithium
Limited (ASX: EUR, FRA: PF8, OTC: EULIF) ("European Lithium") for a
gross consideration of US$10 million. For further information see
note 20.
In 2022, the Company elected not
to proceed with further exploration at its Oacama project in South
Dakota but retained a 15% interest through a now-expired earn-in
agreement with North American Strategic
Minerals, Inc. Following an impairment review at the 2024 year-end,
the carrying value of this project was fully impaired, at £163k,
the licences having now been allowed to lapse.
16.
Financial assets measured at Fair Value through Other Comprehensive
Income
The
Group holds certain equity investments that are not held for
trading purposes. Management has elected to classify these
investments as being measured at fair value through other
comprehensive income ("FVOCI") because these equities represent
investments that the Group intends to hold for the foreseeable
future for strategic purposes.
|
|
Group
£000
|
Company
£000
|
1 July 2022
|
|
1,221
|
-
|
Additions
|
|
-
|
1,219
|
Fair value gains/(losses) recognised
in OCI
|
|
-
|
-
|
30
June 2023
|
|
1,221
|
1,219
|
Additions
|
|
-
|
-
|
Impairment
|
|
(1,189)
|
(1,189)
|
FX
|
|
(2)
|
-
|
Fair value gains/(losses) recognised
in OCI
|
|
-
|
-
|
30 June 2024
|
|
30
|
30
|
The financial assets at FVOCI are
measured based on level three inputs of the fair value hierarchy
i.e. unobservable inputs, used when relevant observable inputs are
not available. Management determined the fair value by reviewing
the operating activities and future plans of the investee and by
taking into consideration the market and economic indicators,
industry trends, and other macroeconomic factors that might impact
the fair value of the investments.
Impairment
My Club Betting (MCB) - having
reviewed the carrying value of MCB and taking into account the last
price at which the company has raised funds, the carrying value has
been impaired to £29k.
Dunraven - Whilst the economics of
the oil licences held by Dunraven are strong, there are impairment
indicators and therefore the Company has impaired 100% of the value
of its holding pending Dunraven securing funding and licence
renewals.
17.
Investment in subsidiaries
Investment in subsidiaries - Company
|
|
Company
£000
|
1 June 2022
|
|
14,905
|
Additions/disposals
|
|
-
|
30 June 2023
|
|
14,905
|
Additions/disposals
|
|
-
|
Transfer of asset held for sale
|
|
(605)
|
30 June 2024
|
|
14,300
|
In April 2024 the Group agreed to
sell LRH please see note 20 for further information.
17. Investment in subsidiaries
(continued)
As at 30 June 2024, the Company held
interests in the following subsidiary companies:
Company
|
Country of registration
|
Proportion
held
|
Nature of
business
|
Techmin Limited
18 Savile Row, London, England, W1S 3PW
|
United
Kingdom
|
100%
|
Mineral
exploration
|
Onshore Energy Limited
18 Savile Row, London, England, W1S 3PW
|
United
Kingdom
|
100%
|
Mineral
exploration
|
Cornish Battery Metals Ltd
18 Savile Row, London, England, W1S 3PW
|
United
Kingdom
|
100%
|
Mineral
exploration
|
Emperium 1 Holdings Corporation
10100, Santa Monica Boulevard
#300, Century City, Los Angeles, CA90067
|
USA
|
90%
|
Mineral
exploration
|
Technology Minerals Idaho Limited
10100, Santa Monica Boulevard
#300, Century City, Los Angeles, CA90067
|
USA
|
90%
|
Mineral
exploration
|
LRH Resources Ltd
Unit E, Kells Business Park,
Cavan Road, Kells Meath
A82 HK12, IRELAND
|
Ireland
|
100%
|
Mineral
exploration
|
Asturmet Recursos S.L.
Avenida de Galicia, Oviedo
Asturias, SPAIN
|
Spain
|
100%
|
Mineral
exploration
|
Technology Minerals Cameroon Limited
PO Box 666
Yaounde
Cameroon
|
Cameroon
|
100%
|
Mineral
exploration
|
LRH Resources Ltd has been
classified as held for sale
18.
Investment in associates
In September 2021, the Company acquired 48.35% of a
battery-recycling business, Recyclus Group Ltd ("Recyclus") for nil
consideration. Under the equity method the initial investment is
recognised at cost being nil.
As there are common Directors between Technology Minerals Plc and
Recyclus Group Ltd, Technology Minerals Plc is able to influence
Recyclus Group Ltd, however, it does not control the Recyclus
Group, which has its own operating, technical and financial
management, as well as separate financial, human resources and
other policies. Recyclus Group Ltd has raised loan and equity
funding from third parties, and Technology Minerals Plc does not
hold rights to favourable returns from its shareholding in Recyclus
Group Ltd under IAS 28 and IFRS 10 criteria. Therefore, management
has concluded that its investment in Recyclus is an investment in
an associate and it did not control Recyclus as at year ended 30
June 2024. See note 5 for further information.
18.
Investment in associates (continued)
Summarised financial information
for Recyclus Group (100% basis):
Group and Company
|
|
2024
£000
|
As
restated
2023
£000
|
Non-current assets
|
|
4,691
|
4,209
|
Current assets
|
|
456
|
525
|
Current liabilities
|
|
(1,827)
|
(784)
|
Non-current liabilities
|
|
(7,920)
|
(6,524)
|
Revenue for the year
|
|
547
|
33
|
Loss for the year
|
|
(2,828)
|
(2,744)
|
The Group's share of the reported
loss of Recyclus for the year amounts to £1.4m (2023: £1.3m as
restated).
Equity loan support
While the investment in the
associate remains at nil, the company has provided loans to the
associate. A portion of these loans has been classified as equity
in accordance with IFRS 9 due to the terms of the loan, as
discussed in Note 19.
This accounting treatment has been
applied to prior periods see note 31 prior year
adjustments.
Carrying amount of investment
Group and Company
|
|
|
£000
|
1 July 2022
|
|
|
-
|
Loan funding recognised as equity,
debited to investment
|
|
|
736
|
Group's share of loss
|
|
|
(736)
|
30 June 2023
|
|
|
-
|
Loan funding recognised as equity,
debited to investment
|
|
|
887
|
Group's share of loss
|
|
|
(887)
|
30
June 2024
|
|
|
-
|
As the Group's share of the losses
in Recyclus exceeds its interest in the associate, it has not
recognised its share of further losses. Once Recyclus subsequently
reports profits, the Group will resume recognising its share of
those profits only after its share of the profits equals the share
of losses not recognised.
There were no significant
transactions between the Group and Recyclus other than the loans
provided. See note 19.
19. Loans to
associates
During the period the Company
provided an unsecured loan to Recyclus which was initially
recognised at amortised cost at the coupon rate in FY2022 and
FY2023. Upon review, the Group has determined that a portion of the
loan should be classified as equity in accordance with IFRS 9 due
to the terms of the loan, which are favourable to the associate and
carry a below-market interest rate.
The equity element represents the
difference between the present value of forecasted future loan
repayment cash flows and the nominal loan amount. The discount rate
used for the 30 June 2024 and 30 June 2023 financial statements was
20%, reflecting interest rate that the company would be charged for
borrowings with no conversion premium. As the Group had no
borrowings for the 30 June 2022 period, the rate used was 12%
reflecting the Group's estimated equity return and the risk-free
rate was the lowest due to Covid. A prior year adjustment was made
to reflect the equity element for 30 June 2022 and 30 June 2023,
which was not recognised in those years, as an investment in an
associate accounted for under the equity method (see Note
31).
Group and Company
|
|
|
£000
|
1 July 2022
|
|
|
4,538
|
Loan funding recognised as equity
and debited to investment
|
|
|
(911)
|
1 July 2022 (as
restated)
|
|
|
3,627
|
Additions
|
|
|
1,859
|
Accrued interest
|
|
|
435
|
Loan funding recognised as equity
and debited to investment
|
|
|
(736)
|
30 June 2023 (as
restated)
|
|
|
5,185
|
Additions
|
|
|
2,203
|
Accrued interest
|
|
|
550
|
Loan
funding recognised as equity and debited to
investment
|
|
|
(887)
|
30 June 2024
|
|
|
7,051
|
Loans to associates generally bear
2.5% interest. The loan is repayable in monthly instalments when
funds are available and if repayments are not made then the Group
is entitled to additional interest of 2%, which has been accrued in
FY2024.
20. Assets held for
sale
In April 2024, the Company signed
a binding heads of agreement to sell 100% of LRH to European
Lithium ('Proposed Transaction'), which includes 100% of its
rights, title and interest in the following:
·
the 23 licences that comprise the Leinster Lithium
Project (the "Licences") (see Table 1 below);
·
all associated technical information, including
geological, geochemical and geophysical reports, surveys, mosaics,
aerial photographs, samples, drill core, drill logs, drill pulp,
assay results, maps and plans, whether in physical, written or
electronic form relating to the Licences; and
·
statutory licences, approvals, consents,
authorisations, rights or permits relating to the
Licences.
The Company will retain LRH's 100%
interest in the Asturmet Ni-Cu-Co Project in, N. Spain, which will
be held through a wholly-owned subsidiary, Technology Minerals
(Ireland) Limited, which was incorporated following the
year-end.
20. Assets held for sale (continued)
In consideration for the Proposed
Transaction, European Lithium will transfer to Technology Minerals
US$10 million worth of fully paid ordinary shares in the capital of
Critical Metals Corp (a company incorporated under the laws of
Delaware in the United States and listed on NASDAQ) ("CRML")
currently held by European Lithium, at an issue price equal to 90%
of the closing price of CRML shares on the day prior to the date on
which the last of the parties enters into the Agreement signed
date). The Consideration Shares will be held in escrow until 28
February 2025.
The sale agreement was signed on
24 November 2024. Completion of the transaction is conditional upon
completion of due diligence by European Lithium as soon as
practicable, Technology Minerals and CRML and its shareholders
agreeing the detailed terms of the escrow, and European Lithium
obtaining any necessary third-party approvals or consents to
complete the transaction. Completion will occur five business days
after the last Condition Precedent has been satisfied.
Technology Minerals is obliged to
maintain the tenements in good standing and meet all obligations in
respect of the licences up until completion.
Accordingly, LRH has been
reclassified from 'Investment in
Subsidiaries' to 'Assets
Held for Sale'. See notes 3 and 5 for further information on
the accounting treatment applied to an Asset Held for
Sale.
Assets and liabilities held for sale as at 30 June
2024
|
|
Group
£000
|
Company
£000
|
|
|
|
|
Non-current assets
|
|
|
|
Intangible assets
|
|
889
|
-
|
Financial assets
|
|
2
|
-
|
Investment in
subsidiaries
|
|
-
|
605
|
|
|
891
|
605
|
Current assets
|
|
|
|
Trade and other
receivables
|
|
14
|
-
|
Total assets held for sale
|
|
905
|
605
|
|
|
|
|
Current liabilities
|
|
|
|
Trade and other
payables
|
|
27
|
-
|
Liabilities directly associated
with assets held for sale
|
|
27
|
-
|
21. Trade and other
receivables
|
Group
2024
£000
|
Company
2024
£000
|
Group
2023
£000
|
Company
2023
£000
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
Amounts due from
subsidiaries
|
-
|
3,087
|
-
|
2,452
|
|
-
|
3,087
|
-
|
2,452
|
Current assets
|
|
|
|
|
Other debtors
|
375
|
369
|
1
|
1
|
VAT receivable
|
37
|
34
|
27
|
28
|
Prepayments and accrued
income
|
20
|
20
|
53
|
52
|
|
432
|
423
|
81
|
81
|
See note 29 for details of the
amounts due from subsidiaries.
22. Cash and cash
equivalent
|
Group
2024
£000
|
Company
2024
£000
|
Group
2023
£000
|
Company
2023
£000
|
|
|
|
|
|
Cash and cash
equivalents
|
15
|
1
|
318
|
-
|
|
15
|
1
|
318
|
-
|
The majority of the Group's funds
are held with Revolut Ltd, which is authorised to issue e-money by
the Financial Conduct Authority under the Electronic Money
Regulations 2011. Revolut Ltd is not a bank.
23. Trade and other
payables
|
Group
2024
£000
|
Company
2024
£000
|
Group
2023
£000
|
Company
2023
£000
|
Current liabilities
|
|
|
|
|
Trade and other
payables
|
604
|
597
|
230
|
200
|
Taxation and social
security
|
157
|
156
|
106
|
104
|
Accruals
|
737
|
737
|
102
|
98
|
|
1,498
|
1,490
|
438
|
402
|
Non-current liabilities
|
|
|
|
|
Amounts due to
subsidiaries
|
-
|
1,102
|
-
|
-
|
|
-
|
1,102
|
-
|
-
|
See note 29 for details of the
amounts due to subsidiaries.
24. Borrowings and derivative
financial liabilities
|
Group
2024
£000
|
Company
2024
£000
|
Group
2023
£000
|
Company
2023
£000
|
|
|
|
|
|
Amount owed to third
parties
|
-
|
-
|
-
|
-
|
Convertible loan notes
|
3,605
|
3,605
|
1,557
|
1,557
|
Total borrowings
|
3,605
|
3,605
|
1,557
|
1,557
|
|
|
|
|
|
Current
|
3,109
|
3,109
|
-
|
-
|
Non-current
|
496
|
496
|
1,557
|
1,557
|
Total borrowings
|
3,605
|
3,605
|
1,557
|
1,557
|
|
|
|
|
|
Derivative financial liability
|
3,092
|
3,092
|
230
|
230
|
For the year ended 30 June 2024
During the year the Company
entered into a number of convertible bond facilities ('CLNs'). Each
of these have accounted for as a financial liability with a related
embedded derivative being the fair value of the convertible
feature. Details of the CLNs issued are described below.
Convertible bonds issued during the year:
Issue date
|
Repayment
date
|
Amount
borrowed
£000s
|
Annual Interest
rate
%
|
Debt at amortised
cost
£000s
|
Derivative financial
liability
£000s
|
Embedded derivative
classified as equity
£000s
|
Fair value of warrants at
amortised cost
£000s
|
04/07/2023
|
See
below
|
500
|
12%
|
482
|
-
|
18
|
-
|
31/08/2023
|
See
below
|
735
|
12%
|
301
|
-
|
49
|
385
|
03/01/2024
|
03/01/2026
|
600
|
8.25%
|
171
|
361
|
-
|
68
|
22/03/2024
|
22/03/2027
|
1,500
|
10.25%
|
311
|
1,050
|
-
|
139
|
30/05/2024
|
30/05/2027
|
600
|
10.25%
|
-
|
540
|
-
|
60
|
28/06/2024
|
28/06/2027
|
400
|
10.25%
|
-
|
371
|
-
|
29
|
Total
|
|
4,335
|
|
1,265
|
2,322
|
67
|
681
|
The fair value of the warrants
issued has been treated as a transaction cost associated with the
issuance of the CLNs. This amount has therefore been debited to the
CLN and amortised over its term. Additionally, since the warrants
have a fixed conversion ratio, they meet the 'fixed-for-fixed'
criterion for equity classification and have been credited to
equity.
4
July 2023 - £500,000 convertible bonds
The company raised £500,000 from
the issue of convertible bonds with a 12% annual interest rate and
a repayment date of 4 January 2024. Conversion of the bonds into
shares in the Company can occur from 6 months from the issue date
at a price of 1.8 pence per share. As the conversion ratio is fixed
the embedded derivative has been classified as equity. On 4 January
2024, it was agreed with the bondholder to extend the redemption
date to 4 July 2024. As part of the extension the interest rate was
increased to 15% per annum. Post year end, a revised repayment
schedule has been agreed with the lender to repay the amount due
plus accrued interest in monthly instalments.
31 August 2023 - £735,000 convertible bonds
The company raised £735,000 from
the issue of convertible bonds with a 12% annual interest rate and
a repayment date of 31 August 2024. Conversion of the bonds into
shares in the Company can occur from 6 months from the issue date
at a price of 1.4 pence per share. As the conversion ratio is fixed
the embedded derivative has been classified as equity. In addition,
73,500,000 share warrants were issued as part of this facility see
not note 26 for further information.
The Company has agreed a schedule
of repayment of interest and principal with the holder of the 4
July 2023 £500,000 convertible bonds, the 31 August 2023 £735,000
convertible bonds and the £1,700,000 convertible bonds issued in
the previous year. Post year end, a revised repayment schedule has
been agreed with the lender to repay the amount due plus accrued
interest in monthly instalments.
3
January 2024 - £600,000 convertible bonds
On 3 January 2024, the Company
entered into a convertible bond facility with CLG Capital LLC for
£5 million, drawable in agreed tranches. The bonds are repayable
within 2 years from drawdown and have an annual interest rate of 3%
fixed plus the prevailing Bank of England base rate (as at the date
immediately preceding the publication of this report, 5%).
Conversion of the bonds into shares in the Company can occur from
40 days from the issue date. The conversion price is set at 95% of
the average of the Volume Weighted Average Price (VWAP) of the
shares over three (3) trading days chosen by the bondholder, during
the ten (10) consecutive trading days prior to the Company
receiving a conversion notice from the bondholder. As the
conversion ratio is variable, the embedded derivative has been
classified as a derivative financial liability at fair value
through profit and loss (FVTPL).
At the 30 June 2024, a gross
amount of £600,000 had been drawn down from the convertible bond
facility with CLG Capital LLC and share warrants over an aggregate
of 18,126,495 Ordinary shares had been issued. The number of
warrants issued had been calculated on the expectation of £1
million having been drawn and has therefore since been adjusted
down to 10,117,429. See note 26 for further details on the share
warrants.
20
March 2024 - £5.5 million convertible bond
facility
On 20 March 2024, the Company
entered into a Convertible Bond Facility with Atlas Capital Markets
('ACM') in the total amount of £5.5 million, drawable in agreed
tranches. Share warrants attach to each drawdown. The annual
interest rate is 5% fixed plus the prevailing Bank of England base
rate (as at the date immediately preceding the publication of this
report, 5%). Conversion of the bonds into shares in the Company can
occur from 20 days from the issue date. The conversion price is set
at 90% of the average of the VWAP of the shares over three (3)
trading days chosen by the bondholder during the twenty (20)
consecutive trading days prior to the Company receiving a
conversion notice from the bondholder. As the conversion ratio is
variable, the embedded derivative has been classified as a
derivative financial liability at fair value through profit and
loss (FVTPL).
The following tranches have been
drawn as at both 30 June 2024:
Tranche
|
Issue date
|
Term
|
Amount
borrowed
£000s
|
Warrants
issued
|
1
|
22/03/2024
|
3
years
|
1,500
|
21,193,266
|
2
|
30/05/2024
|
3
years
|
600
|
20,469,153
|
3
|
28/06/2024
|
3
years
|
400
|
17,646,955
|
Total
|
|
|
2,500
|
59,309,374
|
During the period between 2 May
2024 and 24 June 2024, £420,000 of ACM tranche 1 was converted into
84,950,867 Ordinary Shares of £0.001 each. See note 32 for
information on loan conversions and drawdowns that occurred after
30 June 2024.
Breach of loan covenants
Unpaid coupon interest
The CLG and ACM bonds require the
payment of coupon interest on a monthly basis. If coupon interest
is not paid on time, penalty interest becomes due at a rate of 2%
per month on the outstanding principal balance. Accordingly, the
penalty interest has been accrued and is included in other finance
costs. See note 11.
Post year end the Company's market
capitalisation fell below £5 million which caused a breach of the
agreement triggering ACM's option for early redemption and the
application of a premium of 20% and additional interest of 20%,
plus a discount of 25% to the conversion price. ACM has waived such
remedies for a year and a day in respect of each bond
issued.
Derivative Financial Liability
The CLG and ACM convertible loan
instruments issued during the year, each contain three embedded
derivative financial liabilities (DFLs). This DFLs arise from
conversion features that allow the holder to convert the loan into
a variable number of the Company's equity instruments based on the
market price at the date of conversion and also arises from a
default event linked to the market capitalisation of the Group. Due
to the variability in conversion terms, the embedded derivative is
classified as a financial liability.
Initial recognition and measurement
At initial recognition, the DFL is
measured at fair value. The fair value of the DFL at the date of
issuance of the convertible loans has been determined using a Monte
Carlo simulation model, which considered multiple variables,
including:
·
Expected share price volatility
·
Risk-free interest rate
·
Expected life of the instrument
·
Conversion probabilities and potential share
price performance
·
Subsequent measurement
Subsequent to initial recognition,
the DFL is remeasured at fair value at each conversion event and at
each reporting date, with any changes in fair value recognised
immediately in profit or loss as a financial expense or
income.
Critical judgements and key sources of estimation
uncertainty
The fair value measurement of the
DFL involves significant judgements and estimates, specifically in
terms of share price volatility, risk-free rate, and timing of
possible conversions. Due to the complexity of the instrument, the
Group uses a Monte Carlo simulation, as described in Note 5 -
Critical accounting estimates and judgements.
As at 30 June 2024, the fair value
of the DFL was as follows:
Group and Company
|
|
|
£000
|
1 July 2022
|
|
|
-
|
Initial recognition
|
|
|
358
|
Derecognition on conversion to
equity
|
|
|
(139)
|
Fair value through income
statement
|
|
|
11
|
30 June 2023
|
|
|
230
|
Reclassified to equity
|
|
|
(230)
|
Initial recognition
|
|
|
2,275
|
Derecognition on conversion to equity
|
|
|
(405)
|
Fair value through income
statement
|
|
|
1,222
|
30 June 2024
|
|
|
3,092
|
The £230k was incorrectly
classified as a liability in the prior year rather than equity.
This has been corrected in the current year. The prior year has not
been restated as the classification and the amount is not
considered material for restatement.
For the year ended 30 June 2023
Bond Facility
The bond facility outstanding as
at 30 June 2023 was for £1.7m which was accounted for as a
financial liability with a related embedded derivative being the
fair value of the convertible feature. The host contract is
measured at amortised cost and the derivative at fair value through
equity.
Interest accrues on this bond at
12% compounding annually. The bond can be converted at any time by
the holder at 3.5 pence per share. The repayment date of this bond
is 27 March 2025. Post year end, a revised repayment schedule has
been agreed with the lender to repay the amount due plus accrued
interest in monthly instalments.
25. Share capital and share
premium
Group and Company
|
Number of ordinary shares of
0.1p
|
Share
capital
£000
|
Share
premium
£000
|
At 1 July 2022
|
1,271,423,593
|
1,271
|
19,770
|
Share issue - placings
|
123,000,000
|
123
|
1,187
|
Share issue - conversion of
CLNs
|
118,186,302
|
118
|
942
|
Share issue - in lieu of services
provided
|
1,100,000
|
1
|
20
|
Share issue - costs
|
-
|
-
|
(59)
|
At 1 July 2023
|
1,513,709,895
|
1,513
|
21,860
|
Share issue - exercise of
warrants
|
11,062,783
|
11
|
122
|
Share issue - conversion of
CLNs
|
84,950,867
|
85
|
335
|
Issue costs
|
-
|
-
|
(32)
|
At
30 June 2024
|
1,609,723,545
|
1,609
|
22,285
|
The detailed history of the
Company's share capital the year ended 30 June 2023 is provided in
the 2023 Annual Report and Accounts. Transactions related to
the year ended 30 June 2024 are as follows:
Date
|
Transaction
|
Price
|
No. Shares
issued
|
Proceeds
£000
|
26/01/2024
|
Exercise of share
warrants
|
£0.01200
|
11,062,783
|
133
|
|
|
|
|
|
02/05/2024
|
ACM CLN Conversion
|
£0.00612
|
40,849,673
|
250
|
11/06/2024
|
ACM CLN Conversion
|
£0.00435
|
18,384,043
|
80
|
24/06/2024
|
ACM CLN Conversion
|
£0.00350
|
25,717,151
|
90
|
|
|
|
84,950,867
|
420
|
26. Share Based
Payments
Warrants Issued
As described in note 24, the
Company issued a number of convertible loans to various third
parties. The terms and conditions of some of the convertible loans
issued including those issued to CLG and ACM resulted in the
issuance of share warrants in the Company as follows:
Date
|
Exercise
price
|
Number of
warrants
issued
|
Aggregate
fair value
£000
|
31/08/2023
|
£0.020000
|
73,500,000
|
385
|
05/01/2024
|
£0.018484
|
8,115,162
|
57
|
18/01/2024
|
£0.014983
|
2,002,267
|
11
|
20/03/2024
|
£0.014200
|
21,193,266
|
139
|
30/05/2024
|
£0.005900
|
20,469,153
|
60
|
28/06/2024
|
£0.004500
|
17,646,955
|
30
|
Total
|
|
142,926,803
|
682
|
Share Based Payments (continued)
The fair value of the warrants
issued during the year ended 30 June 2024 was calculated using the
Black-Scholes model using the following information:
Issue date
|
31/08/2023
|
05/01/2024
|
18/01/2024
|
Number of shares that could be
acquired on the exercise of the warrant
|
73,500,000
|
8,115,162
|
2,002,267
|
Fair value of one CLN
Warrant
|
£0.005200
|
£0.007000
|
£0.005400
|
Warrant Share exercise
price
|
£0.020000
|
£0.018484
|
£0.014983
|
Date of grant
|
31/08/2023
|
05/01/2024
|
18/01/2024
|
Time to maturity, years
|
2
|
3
|
3
|
Share price
|
£0.0145
|
£0.0140
|
£0.0110
|
Expected volatility*,%
|
79%
|
85%
|
85%
|
Expected dividend growth
rate,%
|
0%
|
0%
|
0%
|
Risk-free interest rate (2 & 3
year
bond),%
|
5.15%
|
3.87%
|
3.94%
|
Issue date
|
20/03/2024
|
30/05/2024
|
28/06/2024
|
Number of shares that could be
acquired on the exercise of the warrant
|
21,193,266
|
20,469,153
|
17,646,955
|
Fair value of one CLN
Warrant
|
£0.006600
|
£0.003000
|
£0.001700
|
Warrant Share exercise
price
|
£0.014200
|
£0.005900
|
£0.004500
|
Date of grant
|
20/03/2024
|
30/05/2024
|
28/06/2024
|
Time to maturity, years
|
3
|
3
|
3
|
Share price
|
£0.0120
|
£0.0053
|
£0.0033
|
Expected volatility*,%
|
89%
|
89%
|
89%
|
Expected dividend growth
rate,%
|
0%
|
0%
|
0%
|
Risk-free interest rate (3 year
bond),%
|
3.90%
|
4.34%
|
4.12%
|
*Calculation of volatility
involves significant judgement by the Directors due to the absence
of the historical trading data for the Company at the date of the
grant.
The fair value of the warrants
issued during the year was £681,000 (2023: £79,000) and has been
treated as transaction costs for the issue of the CLNs and is
amortised over the term of the CLNs
Warrants exercised
On 26 January 2024, 11,062,783 share warrants were exercised at a
price of £0.012 each. See note 25 for further
information.
For the year ended 30 June 2023:
Detailed information on the share warrants issued in the year ended
30 June 2023 is provided in the 2023 Annual Report and
Accounts.
26. Share Based
Payments (continued)
At 30 June 2024, the Company had
outstanding warrants to subscribe for Ordinary shares as
follows:
Warrant exercise price
|
Expiry date
|
Fair value of individual
warrant
|
At
01/07/2023
|
Issued
|
Exercised/
lapsed
|
At
30/06/2024
|
£0.033750
|
29/07/2023
|
£0.003937
|
306,229,366
|
-
|
(306,229,366)
|
-
|
£0.033750
|
17/11/2023
|
£0.004010
|
49,808,280
|
-
|
(49,808,280)
|
-
|
£0.001000
|
17/11/2023
|
£0.021510
|
666,667
|
-
|
(666,667)
|
-
|
£0.021672
|
16/12/2024
|
£0.005300
|
6,921,527
|
-
|
-
|
6,921,527
|
£0.017446
|
30/01/2025
|
£0.004600
|
4,298,980
|
-
|
-
|
4,298,980
|
£0.016900
|
24/02/2025
|
£0.004100
|
5,494,471
|
-
|
-
|
5,494,471
|
£0.020000
|
31/08/2025
|
£0.005200
|
-
|
73,500,000
|
-
|
73,500,000
|
£0.018484
|
05/01/2027
|
£0.007000
|
-
|
8,115,162
|
-
|
8,115,162
|
£0.014983
|
18/01/2027
|
£0.005400
|
-
|
2,002,267
|
-
|
2,002,267
|
£0.014200
|
20/03/2027
|
£0.006600
|
-
|
21,193,266
|
-
|
21,193,266
|
£0.005900
|
30/05/2027
|
£0.003000
|
-
|
20,469,153
|
-
|
20,469,153
|
£0.004500
|
28/06/2027
|
£0.001700
|
-
|
17,646,955
|
-
|
17,646,955
|
|
|
|
373,419,291
|
142,926,803
|
(356,704,313)
|
159,641,781
|
Share options
No share options were issued
during the year ended 30 June 2024. £102,085 (2023: £2,218,160) was
expensed in FY2024.
Detailed information on the share
options issued in the year ended 30 June 2023 is provided in the
2023 Annual Report and Accounts.
At 30 June 2024, the Company had
outstanding share options to subscribe for Ordinary shares as
follows:
Exercise price
|
Expiry date
|
Fair value of individual
share option
|
At 01/07/2023
|
Issued
|
Exercised
|
At 30/06/2024
|
£0.02325
|
13/04/2033
|
£0.0192
|
128,534,322
|
-
|
-
|
128,534,322
|
|
|
|
128,534,322
|
-
|
-
|
128,534,322
|
Information on the share options
granted to each Director is shown in the remuneration
report.
27. Non-controlling
interests
Non-controlling interests that are
material to the Group are reflected in the table below.
Emperium 1 Holdings Corporation
('Emperium')
On 20 May 2022 Technology Minerals
Plc sold a 10% interest in its wholly owned subsidiary Emperium,
through which it holds its interest in the US cobalt/copper
project: the Blackbird Creek Project and the Emperium Project
(collectively "the Properties"), to Bluebird Metals LLC, taking the
Company's ownership down to 90%. The consideration received for the
10% disposal was £860,000.
27. Non-controlling interests (continued)
Technology Minerals Idaho Limited ('TM
Idaho')
Post period, the Company entered
into heads of agreement, subject to conditions precedent, by which
Bluebird Metals LLC would acquire a further 70% interest in the
Company's cobalt interest in Idaho, USA.
Summarised below is the financial
information for Emperium and TM Idaho, before intragroup
eliminations together with amounts attributable to NCI:
|
|
2024
£000
|
2023
£000
|
Non-current assets
|
|
1,024
|
459
|
Current assets
|
|
-
|
-
|
Non-current liabilities
|
|
-
|
-
|
Current liabilities
|
|
(900)
|
(298)
|
Net assets
|
|
124
|
161
|
Attributable to owners of the
parent
|
|
111
|
147
|
Attributable to non-controlling
interests
|
|
13
|
14
|
Attributable to non-controlling interests
|
|
2024
£000
|
2023
£000
|
Loss for the year
|
|
(6)
|
(12)
|
|
|
|
|
Net (decrease)/increase in cash
and cash equivalents
|
|
-
|
-
|
28. Financial risk
management
The Group's activities expose it
to a variety of financial risks which result from its operating and
investing activities, market risk (foreign currency exchange risk),
liquidity risk, capital risk and credit risk. These risks are
mitigated wherever possible by the Group's financial management
policies and practices described below. The Group's financial risk
management is carried out by the finance team led by the Chief
Financial Officer and under policies approved by the Board. Group
Finance identifies, evaluates and mitigates financial risks in
close co-operation with the Group's senior management
team.
Financial instruments by category
Group
|
Group
2024
£000
|
Company
2024
£000
|
Group
2023
£000
|
Company
2023
£000
|
Financial assets at amortised costs:
|
|
|
|
|
Trade and other
receivables
|
432
|
423
|
81
|
81
|
Cash
|
15
|
1
|
318
|
-
|
Loan receivable
|
7,051
|
7,051
|
5,185
|
6,493
|
Financial liabilities at amortised costs:
|
|
|
|
|
Trade and other
payables
|
1,498
|
1,490
|
438
|
402
|
Borrowings
|
3,605
|
3,605
|
1,557
|
1,557
|
Financial assets at fair value through other comprehensive
income:
|
|
|
|
|
Financial assets
|
30
|
30
|
1,221
|
1,219
|
Financial liabilities at fair
value through comprehensive income
|
3,092
|
3,092
|
1,557
|
1,557
|
28. Financial risk management (continued)
Investments in equity instruments
at FVTOCI are measured at cost, less impairments, which is
considered to be equal to their fair values.
Capital risk
Capital risk refers to the risk
associated with a Company's ability to maintain an appropriate
level of capital to support its operations and absorb potential
losses.
The Group's objectives when
managing capital risk are:
·
to safeguard the Group's ability to continue as a
going concern, so that it continues to provide returns and benefits
for shareholders;
·
to support the Group's growth; and
·
to provide capital for the purpose of
strengthening the Group's risk management capability.
The Group actively and regularly
reviews and manages its capital structure to ensure an optimal
capital structure and equity holder returns, taking into
consideration the future capital requirements of the Group and
capital efficiency, prevailing and projected profitability,
projected operating cash flows, projected capital expenditures and
projected strategic investment opportunities. Management regards
total equity as capital and reserves, for capital management
purposes. The Group is not subject to externally imposed capital
requirements.
Credit risk
Credit risk refers to the risk
that the Group's financial assets will be impaired by the default
of a third party (being non-payment within the agreed credit
terms). The Group is exposed to credit risk primarily on its cash
and cash equivalent balances as set out in note 22 and on its trade and other
receivable balances as set out in note 21. The Group's credit risk
is primarily attributable to its other receivables, being royalty
receivables. It is the policy of the Group to present the amounts
in the balance sheet net of allowances for doubtful receivables,
estimated by the Group's management based on prior experience and
the current economic environment. In certain cases, the Group has
the right to audit the reported royalty income.
For banks and financial
institutions, only parties with a minimum credit rating of BBB are
accepted. The majority of cash is held with Revolut Limited in the
UK.
The Directors have considered the
credit exposures and do not consider that they pose a material risk
at the present time. The credit risk for cash and cash equivalents
is managed by ensuring that all surplus funds are deposited only
with financial institutions with high quality credit ratings. There
are currently no expected credit losses in respect of cash balances
held.
Liquidity risk
Liquidity risk relates to the
ability of the Group to meet future obligations and financial
liabilities as and when they fall due. The Group currently has
access to sufficient cash resources to pay the trade and other
payables and contingent consideration as and when they fall
due.
Future expected payments
Group
|
|
2024
£000
|
2023
£000
|
Trade and other payables within
one year
|
|
1,498
|
438
|
Current tax liabilities within one
year
|
|
-
|
-
|
28. Financial risk management (continued)
Foreign exchange risk
The Group is exposed to foreign
exchange risk arising from currency exposures, primarily with
respect to the United States Dollar (USD) and the Euro
(EUR).
The following table highlights the
major currencies the Group operates in and the movements against
the Great British Pound (GBP) during the course of the
year:
|
Average
rate
|
Reporting spot
rate
|
|
2024
|
2023
|
Movement
|
2024
|
2023
|
Movement
|
United States Dollar
|
1.26
|
1.20
|
0.06
|
1.26
|
1.27
|
(0.01)
|
Euro
|
1.17
|
1.15
|
0.02
|
1.18
|
1.16
|
0.02
|
The Group's exposure to foreign
currency risk based on GBP equivalent carrying amounts of monetary
items at the reported date:
|
2024
£000
USD
|
2024
£000
EUR
|
2023
£000
USD
|
2023
£000
EUR
|
Cash and cash
equivalents
|
-
|
8
|
1
|
33
|
Trade and other
receivables
|
-
|
7
|
-
|
4
|
Trade and other
payables
|
(8)
|
(61)
|
(8)
|
(88)
|
Net exposure
|
(8)
|
(46)
|
(7)
|
(51)
|
The Group does not hedge against
foreign exchange movements.
Exchange rate sensitivity
The Group is mainly exposed to
foreign exchange risk on the cash balances and trade and other
payables denominated in currencies other than GBP as detailed
above. A +/- 10% change in the GBP:EUR and GBP:USD rate and
the impact of a +/- 10% change on the exchange rates on the
translation of foreign subsidiaries into the Group's presentation
currency would result in the following changes:
|
2024
£000
|
2024
£000
|
2023
£000
|
2023
£000
|
|
Profit/(loss)
+10%/-10%
|
Equity
+10%/-10%
|
Profit/(loss)
+10%/-10%
|
Equity
+10%/-10%
|
USD
|
(1) /
1
|
1 /
(1)
|
(11) /
11
|
16 /
(16)
|
EUR
|
(33) /
33
|
16 /
(16)
|
(18) /
18
|
25 /
(25)
|
29. Related party
transactions
Aggregate base salaries paid to
the Executive Directors incurred during the year ended 30 June 2024
were £535k (2023: £545k). See note 9 for further
details.
The aggregate amount paid to the
Non-Executive Directors for services for the year ended 30 June
2024 was £54k (2023: £54k).
During the year, the Company
provided additional loans totalling £2.2 million to its associate
company, Recyclus Group, bringing the total amount lent, to
approximately £7.1 million (2023 as restated: £5.1million) after
recognising an equity element as further set out in Note
19.
Alex Stanbury and Robin Brundle
are each Directors of Recyclus Group Limited. The coupon interest
on the loan between the Company and Recyclus Group is 2.5% per
annum, or in the case of late repayments, 4.5%. The amount charged
for the year ended 30 June 2024 was £162,000 (2023: £196,000)
including the recognition of overcharges recorded in the year ended
30 June 2023. See notes 18 and 19 for further
information.
During the year the Company
charged £406,216 (2023: £356,884) for the provision of management
services to its subsidiaries.
During the year the Company
provided an aggregate of £3.1 million (2023: £2.5 million) of loans
to its subsidiaries and associates. The interest charged on the
loans was 2.5% per annum and the amount charged for the period was
£66,862 (2023: £40,075). See note 21.
During the year the Company had an
outstanding payable of £1.1 million (2023: £1.1 million) due to its
wholly owned subsidiary, Onshore Energy Limited. See note
23.
As at 30 June 2024 amounts
receivable and payable from and to subsidiary undertakings was as
follows:
Company
|
2024
£000
|
2023
£000
|
Techmin Limited
|
301
|
558
|
Onshore Energy Limited
|
(1,102)
|
(1,087)
|
Emperium 1 Holdings
Corporation
|
429
|
298
|
Technology Minerals Idaho
Limited
|
471
|
461
|
Technology Minerals
Cameroon
|
518
|
241
|
LRH Resources Ltd
|
547
|
362
|
Asturmet Recursos S.L.
|
808
|
531
|
Cornish Battery Metals
Ltd
|
13
|
-
|
|
1,985
|
1,364
|
30. Notes supporting statement
of cashflows
Significant non-cash transactions
from financing activities are as follows:
|
2024
£000
|
2023
£000
|
Conversion of loan notes to
equity
|
420
|
1,060
|
See note 24 for further
information.
30. Notes supporting statement of cashflows (continued)
Reconciliation of net cash flow to movement in net
debt
Group
|
2024
£000
|
2023
£000
|
Cash and cash
equivalents
|
15
|
318
|
Borrowings
|
(3,605)
|
(1,557)
|
Net debt
|
(3,590)
|
(1,239)
|
Net (decrease)/increase in cash
and cash equivalents in the period
|
(303)
|
(53)
|
Cash inflow from increase in
borrowings
|
(3,944)
|
(2,675)
|
Other non-cash changes
|
1,476
|
58
|
Conversion of borrowing to
equity
|
420
|
1,060
|
Change in net debt resulting from
cashflows
|
(2,351)
|
(1,610)
|
Net debt at the start of the
year
|
(1,239)
|
371
|
Net debt at the end of the
year
|
(3,590)
|
(1,239)
|
Other non-cash changes relate to
the recognition and movement of the embedded derivative and the
fair value of the warrants granted in relation to convertible loan
notes.
31. Prior year
adjustments
In the prior year financial
statements, loans provided to the Group's associate, Recyclus
Group, were fully recognised as a loan to associate and measured at
amortised cost using the mark up rate of 2.5%, which was deemed to
be at market rate. No equity component of the loans was identified
or accounted for.
During the current financial year,
it was determined that a portion of these loans should have been
recognised as equity in the associate due to the material
difference between the company's borrowing rate, as noted below,
and the mark up rate of 2.5% and considering the change in
management's decision in the current year not to acquire the
remaining shares of the Recyclus Group. Consequently, a change in
the accounting treatment was made to ensure the financial
statements more accurately reflect the substance of the
arrangements and current intention of not to acquire the remaining
share of Recyclus.
This updated treatment has been
applied retrospectively, and prior period figures for the years
ended 30 June 2022 and 2023 have been restated to reflect the
recognition of the equity component of the loans, as further
explained below.
30 June 2022: A portion of the
loan amounting to £911k, was reclassified as equity using a 12%
discount rate, which represented the Group's estimated cost of
equity for that period. This equity portion was reduced to nil by
the recognition of a part of the Group's share of the loss in
Recyclus Group.
30 June 2023: A portion of the
loan, amounting to £736k, was reclassified as equity using a 20%
discount rate, representing the Group's estimated cost of equity
for that period. This equity portion was reduced to nil by the
recognition of a part of the Group's share of the loss in Recyclus
Group.
Additional finance income of £339k
was recognised reflecting the unwinding of the 12% and 20% discount
rate. The £1,308k adjustment is the aggregate of FY2022 and
FY2023.
31. Prior year adjustments (continued)
The retained earnings, investment
and loan balances in the associate for prior periods have been
adjusted to reflect the equity component and the share of loss in
the associate as of 30 June 2022 and 30 June 2023. The impact of
these adjustments is summarised below:
Year ended 30 June 2023
|
Previous
2023
|
Adjustment
|
Restated
2023
|
|
£000
|
£000
|
£000
|
|
|
|
|
Non-current assets
|
|
|
|
Property, plant and
equipment
|
4
|
-
|
4
|
Intangible assets
|
15,789
|
-
|
15,789
|
Financial assets
|
1,221
|
-
|
1,221
|
Investment in
associates
|
-
|
-
|
-
|
Loans to associates
|
6,493
|
(1,308)
|
5,185
|
Total non-current assets
|
23,507
|
(1,308)
|
22,199
|
|
|
|
|
Current assets
|
|
|
|
Trade and other
receivables
|
81
|
-
|
81
|
Cash and cash
equivalents
|
318
|
-
|
318
|
Current assets
|
399
|
-
|
399
|
|
|
|
|
Total assets
|
23,906
|
(1,308)
|
22,598
|
|
|
|
|
Current liabilities
|
|
|
|
Trade and other
payables
|
438
|
-
|
438
|
Borrowings
|
-
|
-
|
-
|
Total current liabilities
|
438
|
-
|
438
|
|
|
|
|
Non-current liabilities
|
|
|
|
Borrowings
|
1,557
|
-
|
1,557
|
Derivative financial
liability
|
230
|
-
|
230
|
Total non-current liabilities
|
1,787
|
-
|
1,787
|
|
|
|
|
Total liabilities
|
2,225
|
-
|
2,225
|
|
|
|
|
Net assets
|
21,681
|
(1,308)
|
20,373
|
|
|
|
|
Equity
|
|
|
|
Share Capital
|
1,513
|
-
|
1,513
|
Share Premium
|
21,860
|
-
|
21,860
|
Warrants reserve
|
1,499
|
-
|
1,499
|
Share-based payments
reserve
|
2,218
|
-
|
2,218
|
Foreign exchange
reserve
|
28
|
-
|
28
|
Accumulated deficit
|
(5,451)
|
(1,308)
|
(6,759)
|
|
|
|
|
Equity attributable to owners of
the parent
|
21,667
|
(1,308)
|
20,359
|
Non-controlling
interests
|
14
|
-
|
14
|
Total equity
|
21,681
|
(1,308)
|
20,373
|
31.
Prior year adjustments (continued)
Prior Year Adjustment (continued)
Year ended 30 June 2022
|
Previous
2022
|
Adjustment
|
Restated
2022
|
|
£000
|
£000
|
£000
|
|
|
|
|
Non-current assets
|
|
|
|
Property, plant and
equipment
|
5
|
-
|
5
|
Intangible assets
|
15,409
|
-
|
15,409
|
Financial assets
|
1,221
|
-
|
1,221
|
Investment in
associates
|
-
|
-
|
-
|
Loans to associates
|
4,538
|
(911)
|
3,627
|
Total non-current assets
|
21,173
|
(911)
|
20,262
|
|
|
|
|
Current assets
|
|
|
|
Trade and other
receivables
|
67
|
-
|
67
|
Cash and cash
equivalents
|
371
|
-
|
371
|
Current assets
|
438
|
-
|
438
|
|
|
|
|
Total assets
|
21,611
|
(911)
|
20,700
|
|
|
|
|
Current liabilities
|
|
|
|
Trade and other
payables
|
602
|
-
|
602
|
Borrowings
|
21
|
-
|
21
|
Total current liabilities
|
623
|
-
|
623
|
|
|
|
|
Total liabilities
|
623
|
-
|
623
|
|
|
|
|
Net assets
|
20,988
|
(911)
|
20,077
|
|
|
|
|
Equity
|
|
|
|
Share Capital
|
1,271
|
-
|
1,271
|
Share Premium
|
19,770
|
-
|
19,770
|
Warrants reserve
|
1,420
|
-
|
1,420
|
Share-based payments
reserve
|
-
|
-
|
-
|
Foreign exchange
reserve
|
30
|
-
|
30
|
Accumulated deficit
|
(1,529)
|
(911)
|
(2,440)
|
|
|
|
|
Equity attributable to owners of
the parent
|
20,962
|
-
|
20,051
|
Non-controlling
interests
|
26
|
-
|
26
|
Total equity
|
20,988
|
(911)
|
20,077
|
32. Events occurring after the
reporting date
On 30 August 2024, the Company
entered into a heads of agreement with BlueBird Metals LLC under
which it was agreed, subject to conditions precedents, that
BlueBird Metals would pay for the U$184,000 to meet the cost of
renewing the licences and would keep the licences in good standing,
as consideration for which, it was agreed Bluebird Metals would
receive an additional 70% interest in the Idaho projects. The
Company will retain 20% interest in the asset and will incur a loss
on disposal of £5.9 million.
On 4 October 2024, the Company
incorporated a new subsidiary, Technology Minerals (Ireland)
Limited into which it is intended to transfer title to the Group's
Asturmet Ni-Cu-Co Project, N. Spain
On 24 November 2024, the Group
signed an agreement to sell its Irish Lithium assets in return for
stock in NASDAQ-listed Critical Metals Corp. , such shares being
available for sale from 28 February 2025. The gross amount of the
sale before introducer commission, settlement of joint venture
partner interests and other related obligations is US$10
million.
Following the year-end, the
Company issued such number of Ordinary shares as is set out in the
table below in settlement of conversion notices received from its
CLN holder, Atlas Capital Markets LLC.
Date
|
Price
|
No. Shares
|
1 July /2024
|
£0.003293
|
27,328,958
|
22 July 2024
|
£0.002442
|
36,855,036
|
17 September 2024
|
£0.001596
|
31,328,320
|
15 October 2024
|
£0.001000
|
99,854,656
|
|
|
195,366,656
|
33. Ultimate controlling
party
The company does not have a single
controlling party.