Final Results

Empire Metals Limited / LON: EEE / Sector: Natural Resources

11 June 2024

Empire Metals Limited

("Empire" or "the Company")

Final Results for the year ended 31 December 2023

Empire Metals Limited (LON: EEE), the AIM-quoted resource exploration and development company, announces its final results for the year ended 31 December 2023.

The annual report and accounts for the year ended 31 December 2023 will be posted to shareholders today and will be available for download shortly from the Company's website, www.empiremetals.co.uk.

Highlights:

·     Confirmed discovery of a giant mineral system at the Pitfield Project ("Pitfield") which has been found to host titanium mineralisation of globally significant size and grade, associated with a 40km by 8km by 5km deep magnetics anomaly, and hosted within a sedimentary "soft-rock" basin.

·     Total drilling comprises 101 Reverse Circulation ("RC") holes for a total of 15,010m as well as seven diamond core holes for a total of 2,025m, all completed in 2023 and H1 2024 and over a 30km strike length.

·     100% success rate during 2024 RC drilling campaign with every hole, and every metre of every hole, intersecting titanium mineralisation from surface, or near surface, until the end of the hole.

·     Consistently positive drill results to support a JORC Code compliant Exploration Target for the Cosgrove and Thomas mineral prospects which is expected in Q2 2024.

·     Favourable mineralogy and metallurgy expected to lead to a relatively simple processing flowsheet and highly concentrated end product.

·     Major new titanium dioxide mineral discovery made in June 2024 which has provided a highly positive new dimension to the Project and is expected to accelerate timescales and further enhance the economics of Pitfield.

·     Advancing all associated workstreams in order to commence the design and construction of a demonstration plant in 2025.

·     Talented exploration and development team established in Western Australia and further bolstered post period end with the addition of five additional highly experienced professionals to support the rapid development of Pitfield.

·     Successful fundraisings in September 2023 and January 2024 raising a total of £6 million to support exploration and development work throughout 2024.

Shaun Bunn, Managing Director, commented: "Empire is on course to deliver a globally significant titanium project following our initial discovery at Pitfield just 12 months ago.  The pace of work witnessed throughout 2023 and into 2024 is a testament to the excitement felt across the technical team and board, who have driven systematic exploration activities and intensive drilling campaigns to ensure our ambitious schedule is maintained. Many of the team have echoed sentiments similar to mine - that Pitfield is a once in a lifetime discovery.  With that in mind, it has been a privilege to begin to assemble a highly talented project team to support development and eventual commercial production at Pitfield.

"Our discovery at Pitfield comes at a time of rapidly shifting realignment of the geopolitical trading blocks that are decoupling the leading titanium mine producers, including China and Russia, from the leading titanium users, namely the US and Europe.  With titanium on the critical minerals/metals list of all the major world economies, this has left certain end users vulnerable and without secure long-term substitutes. This is where Empire hopes to bridge the gap; due to its strategic location and scale, Pitfield represents a timely new secure supply entry into the global titanium industry. 

"I look forward to reporting on what I believe will be seminal year ahead for Empire, as we begin to reveal the potential of the Pitfield through an Exploration Target and move closer to the construction of our demonstration plant on the path to commercialisation.  Our recent discovery of a major new titanium dioxide discovery, comprising rutile and anatase, at near surface has added an exciting new element to Pitfield, and has opened the possibility of a staged development plan whereby we focus initially on the much higher-grade, titanium dioxide mineral-rich saprolite deposits whilst continuing to develop a processing route for the titanite-rich bedrock deposits.  The simple processing characteristics of rutile and anatase may support an expedited path to our demonstration plant, so our foot remains on the accelerator as we look to unlock the full potential of Pitfield over the coming years."

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014, as incorporated into UK law by the European Union (Withdrawal) Act 2018, until the release of this announcement.

**ENDS**

For further information please visit www.empiremetals.co.uk  or contact:

CHAIRMAN'S STATEMENT

As we look back in years to come, 2023 will be remembered as a pivotal time for your company; defined by the discovery of what is proving to be a titanium asset of potential unrivalled value.  The Pitfield Project in Western Australia ("Pitfield" or the "Project") combines scale, grade, amenability to low-cost processing and strategic location, resulting in profound commercial and operational desirability.  

As shareholders will be aware, our work at Pitfield began in 2022 and within weeks of our first airborne magnetic survey, the Empire exploration team understood that a major mineralised zone had been identified.  This airborne magnetic survey was quickly followed with an airborne electro-magnetic survey, and an evaluation of the historical exploration database, which confirmed the presence of an exceptionally large magnetic anomaly extending over 40km in length.

Armed with this information and combined with the results of a Dipole-Dipole Induced Polarisation survey conducted in late 2022, Empire launched its maiden drill programme at Pitfield in March 2023, comprising 21 holes for a total of 3,206m.  Titanium rich mineralisation (between 4% and 10% TiO2) was identified in all-but-one of the holes, starting at or very near surface and with nearly a quarter of the holes still ending in high TiO₂ values of up to 154 metres depth. It was at this point that the Empire team understood that they had discovered a geological unique soft-rock titanium deposit.

Subsequent drilling programmes throughout 2023 and into 2024 have brought total drilling to 101 Reverse Circulation holes for a total of 15,010m as well as seven diamond core holes for a total of 2,025m, all completed within 13 months and over a 30km strike length.  This speaks to the level of commitment and enthusiasm we have for advancing our geological understanding of Pitfield.  The consistently exceptional results delivered from these drilling campaigns have driven us forward, and the team are yet to encounter any igneous intrusions or significant cross faults that could disrupt and complicate the ore geology, providing further evidence of a remarkable continuity of mineralisation and thus supporting a simple geological model.

Our work during 2023 provided us with the unambiguous view that we had discovered a titanium asset of remarkable size and grade at Pitfield.  Indeed, we have had a 100% success rate in terms of our recent RC drilling work, with every hole, and every metre of every hole, intersecting titanium mineralisation from surface, or near surface, until the end of the hole.  Given the potential scale of the asset, the Empire team determined that immediate work would be focussed on two high-grade titanium-mineralised zones, known as the Cosgrove and Thomas prospects, which were selected for resource evaluation work in areas that show potential to support shallow open pit mining.  We have a strong basis for delivering a JORC Compliant Exploration Target for Cosgrove and Thomas, and we are working towards giving this first tangible insight into the potential scale of the Project.  Given the known mineralisation at Pitfield remains open in all directions, this initial Exploration Target will be the tip of the iceberg.

With our confidence in our geological model established, our work post period end has narrowed in on demonstrating Pitfield's viability for economic development through mineralogical studies and metallurgical test work.

In March 2024, Empire took a significant leap forward towards achieving this objective through the demonstration of favourable mineralogy and metallurgy in high-grade titanium samples drilled at Pitfield; indicating potential for a relatively simple processing flowsheet and highly concentrated end product.  Importantly titanite, a calcium titanium silicate, was confirmed as the most abundant titanium-bearing mineral, accounting for approximately 67% of the total contained TiO₂ and approximately 20% of the potential Pitfield ore by mass.

This confirmation that the titanium mineralisation is dominated by titanite, in such quantities as to set Pitfield apart from any previously reported world class titanium resource, has further reinforced our belief that we are dealing with an unprecedented discovery, one that could provide a path for Empire to become a major supplier of rutile equivalent product' or even a significant TiO₂ pigment producer in our own right. 

Titanite is a non-refractory mineral and is amenable to a simple low temperature acid leaching process to liberate the titanium, unlike igneous hard rock ilmenite ores which frequently require on-site smelting to produce a lower value titanium-rich slag product.  The conceptual processing flowsheet that is being tested consists of beneficiation stages to generate a titanium-rich heavy mineral concentrate and to remove acid-consuming gangue minerals, followed by a simple acid leaching stage. It will therefore not require an energy intensive, on-site smelting process, which will be highly beneficial from a commercial perspective.  The final product from the leaching stage is expected to have a very high TiO₂ concentration, approaching the same content as natural rutile (>95%), which would make it a highly desirable feedstock for a titanium dioxide pigment producer.

Earlier this month, we announced a major new titanium dioxide mineral discovery which has provided a highly positive new dimension to the Project, and which is expected to accelerate timescales and further enhance the economics of Pitfield.  This newly identified, potentially high-value titanium dioxide deposit, which features naturally occurring rutile and anatase, is located within the near-surface, strongly weathered saprolite zone of bedrock which covers the extent of the giant, 40km long, titanium-rich mineral system at Pitfield.  Rutile and anatase are both highly valuable titanium dioxide minerals that contain >95% TiO₂ and are both important feedstocks for the titanium pigment and titanium metal markets.

Our analysis shows that the strongest weathering, found within the top 10m from surface, has resulted in the disintegration of the parent bedrock and has completely altered the titanite (the principal titanium ore mineral in the unweathered bedrock) to titanium dioxide minerals, rutile and/or anatase.  Simply put, Mother Nature has assisted us with altering this bedrock, through simple weathering, to form high-value titanium dioxide minerals which is highly positive development in isolation, but importantly, provides strong support for the Company's view that TiO₂ products can be derived from the titanite bedrock ore source.

Preliminary mineralogical assessment of the strongly weathered mineralised sandstones indicates an abundance of these natural titanium dioxide minerals, comprising around half of all titanium minerals present by mass, and ongoing studies will provide a more comprehensive understanding of the mineral assemblage, including the relative proportions of rutile and anatase.

This discovery reinforces the potential for Empire to develop a fully integrated, single site, mine to high quality TiO₂ product project and it opens up the possibility of a new, staged development plan whereby the Company can look to develop the much higher-grade, high-value, more easily accessible titanium dioxide mineral-rich surface deposits whilst it continues to develop a processing route for the titanite-rich bedrock deposits.

Corporate

Empire is clearly gearing up for delivering a commercial project in as short time as practicable at Pitfield, and to support this, we have significantly bolstered our technical team.

Post period end, Empire announced the appointment of Narelle Marriott as the Company's Process Development Manager and shortly after, secured the services of two senior titanium industry consultants, Dr. Trevor Nicholson and Eugene Dardengo, who together have over 72 years of experience in the titanium processing and extraction industry.   The Company also appointed Carrie Pritchard as Environmental Manager and David Parker as Commercial Manager; both highly experienced professionals in the mining industry who will provide invaluable support to Empire as it advances Pitfield.

The Company will continue to seek out experienced and talented professionals to join our small and motivated development team as we move closer towards commercialisation of Pitfield.

Financial Results

As an exploration and development group which has no revenue we are reporting a loss for the 12 months ended 31 December 2023 of £2,796,461 (31 December 2022: loss of £1,162,720).

The Group's cash position as at 7 June 2024 was £3.43 million.

Outlook

Empire has set an impressive pace in its objective to confirm commercial viability at Pitfield; progressing from initial discovery hole to mineralogy and metallurgical test work within 12 months.  The Board are dedicated to continuing this momentum and the Company has committed to working towards commencing the design and construction of a demonstration plant in 2025.  In parallel with this work, all wider aspects of the Project development plan will continue to be advanced, which will include a number of key milestones throughout the remainder of the year.

These workflows will combine all technical outputs, including definitive mineralogical characterisation studies, definitive metallurgical characterisation studies and subsequent finalisation of a process flowsheet and demonstration plant design that will establish, confirm and provide valuation metrics for an economic process and resultant high-value saleable product.  Alongside this work, a maiden Exploration Target and maiden JORC-compliant Mineral Resource Estimate will be delivered, laying the foundation for a mining option study and eventual ore reserves.

The remaining months of 2024, and into 2025, are set to be a period of rapid development for Empire and we look forward to updating shareholders regularly on our achievements and plans.  I would like to take this opportunity to thank our shareholders and wider stakeholders once again for their support, as we look to the future with considerable optimism and excitement for what Empire will deliver.

Neil O'Brien

Non-Executive Chairman

10 June 2024

CONSOLIDATED STATEMENT OF FINANCIAL POSITION  

As at 31 December 2023

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME       

Year ended 31 December 2023

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

For the year ended 31 December 2023

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 December 2023

¹ Comprised of 5,611,863 shares at 1.35p in respect of consideration payable to acquire the Walton Project License.

² Share options and warrants over a total of 39,080,208 ordinary shares of no par value were granted to Directors and management in the period.

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 31 December 2023

ACCOUNTING POLICIES

1.    General Information

The principal activity of Empire Metals Limited ("the Company") and its subsidiaries (together "the Group") is to implement its mineral exploration strategy to advance projects towards defining a sufficient in-situ mineral resource to support a detailed feasibility study towards mine development and production.

The Company's shares are traded on AIM, a market operated by the London Stock Exchange. The Company is incorporated in the British Virgin Islands and domiciled in the United Kingdom. The Company changed its name to Empire Metals Limited on 10 February 2020.

The address of its registered office is Craigmuir Chambers, PO Box 71, Road Town, Tortola, BVI.

2.    Summary of Significant Accounting Policies

The principal accounting policies applied in the preparation of these Financial Statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

2.1  Basis of Preparation of Financial Statements

The Group Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee (IFRS IC) interpretations as adopted by the European Union. The Group Financial Statements have been prepared under the historical cost convention, unless stated otherwise.

The Financial Statements are presented in UK Pounds Sterling rounded to the nearest pound.

The preparation of Financial Statements in conformity with IFRSs requires the use of certain critical accounting estimates.  It also requires management to exercise its judgement in the process of applying the Group's Accounting Policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Statements, are disclosed in Note 4.

2.2  Changes in accounting policy and disclosures

(a) New and amended standards mandatory for the first time for the financial periods beginning on or after 1 January 2023

The International Accounting Standards Board (IASB) issued various amendments and revisions to International Financial Reporting Standards and IFRIC interpretations. The amendments and revisions were applicable for the period ended 31 December 2023 but did not result in any material changes to the Financial Statements of the Group.

b) New standards, amendments and interpretations in issue but not yet effective or not yet endorsed and not early adopted

Standards, amendments and interpretations that are not yet effective and have not been early adopted are as follows:

The Group is evaluating the impact of the new and amended standards above which are not expected to have a material impact on future Group Financial Statements.

2.3  Basis of Consolidation

The Group Financial Statements consolidate the Financial Statements of Empire Metals Limited and the Financial Statements of all of its subsidiary undertakings made up to 31 December 2023.

Subsidiaries are entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Where an entity does not have returns, the Group's power over the investee is assessed as to whether control is held. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

Below is a summary of subsidiaries of the Group:

Inter-company transactions, balances, income and expenses on transactions between group companies are eliminated. Profits and losses resulting from intercompany transactions that are recognised in assets are also eliminated.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

2.4  Going Concern

The Group's business activities, together with the factors likely to affect its future development, performance and position, are set out in the Chairman's Report from page 3. In addition, Note 3 to the Financial Statements includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; and details of its exposure to credit and liquidity risk.

The Financial Statements have been prepared on a going concern basis. Although the Group's assets are not generating steady revenue streams, an operating loss has been reported and an operating loss is expected in the 12 months to 31 December 2024, the Directors believe that the Group will have sufficient funds to meet its immediate working capital requirements and to meet all committed exploration costs over the next 12 months from the date of approval of these Financial Statements. As at the balance sheet date, the Group has cash and cash equivalents of £2,752,187 and a further £3 million was raised via the issue of new ordinary shares in January 2024. These amounts combined are expected to adequately cover forecast working capital requirements. 

The Directors have, in the light of all the above circumstances, a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing the Group Financial Statements.

2.5  Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.

Segment results, include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

2.6  Foreign Currencies

(a) Functional and presentation currency

Items included in the Financial Statements of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the 'functional currency'). The functional currency of the Company is Sterling, the functional currency of the BVI subsidiaries is US Dollars, the functional currency of the Austrian subsidiary is Euros and the functional currency of the Australian subsidiary is AUD Dollars. The Financial Statements are presented in Pounds Sterling, rounded to the nearest pound.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where such items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement.

(c) Group companies

The results and financial position of all the Group's entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

·    assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;

·    income and expenses for each statement of comprehensive income presented are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

·    all resulting exchange differences are recognised in other comprehensive income where material.

On consolidation, exchange differences arising from the translation of the net investment in foreign entities, and of monetary items receivable from foreign subsidiaries for which settlement is neither planned nor likely to occur in the foreseeable future, are taken to other comprehensive income. When a foreign operation is sold, such exchange differences are recognised in the income statement as part of the gain or loss on sale.

2.7  Intangible Assets

Exploration and evaluation assets

The Group recognises expenditure as exploration and evaluation assets when it determines that those assets will be successful in finding specific mineral resources. Expenditure included in the initial measurement of exploration and evaluation assets and which are classified as intangible assets, relate to the acquisition of rights to explore, topographical, geological, geochemical and geophysical studies, exploratory drilling, trenching, sampling and activities to evaluate the technical feasibility and commercial viability of extracting a mineral resource. Capitalisation of pre-production expenditure ceases when the mining property is capable of commercial production.

Exploration and evaluation assets are recorded and held at cost.

Exploration and evaluation assets are assessed for impairment annually or when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount. The assessment is carried out by allocating exploration and evaluation assets to cash generating units, which are based on specific projects or geographical areas. IFRS 6 permits impairments of exploration and evaluation expenditure to be reversed should the conditions which led to the impairment improve. The Group continually monitors the position of the projects capitalised and impaired.

Whenever the exploration for and evaluation of mineral resources in cash generating units does not lead to the discovery of commercially viable quantities of mineral resources and the Group has decided to discontinue such activities of that unit, the associated expenditures are written off to the Income Statement.

2.8  Property, Plant and Equipment

Property, plant and equipment is stated at historical cost less accumulated depreciation and any accumulated impairment losses. Depreciation is provided on all property, plant and equipment to write off the cost less estimated residual value of each asset over its expected useful economic life on a straight-line basis at the following annual rates:

Computer equipment - 20 to 50% straight line

Field equipment - 20 to 50% straight line

All assets are subject to annual impairment reviews. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replacement part is derecognised. All other repairs and maintenance are charged to the Income Statement during the financial period in which they are incurred.

The asset's residual value and useful economic lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within 'Other gains / (losses)' in the income statement.

2.9  Impairment of non-financial assets

Assets that have an indefinite useful life, for example, intangible assets not ready to use, are not subject to amortisation and are tested annually for impairment.  An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units).

Non-financial assets that suffered impairment (except goodwill) are reviewed for possible reversal of the impairment at each reporting date.

2.10 Assets classified as held for sale

Assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying value and fair value less costs to sell. An impairment loss is recognised for any subsequent write-down of the asset to fair value less costs to sell.

2.11 Financial Assets

(a) Classification

The Group classifies its financial assets in the following categories: at amortised cost including trade receivables and other financial assets at amortised cost, at fair value through other comprehensive income and at fair value through profit or loss, loans and receivables, and available-for-sale.  The classification depends on the purpose for which the financial assets were acquired.  Management determines the classification of its financial assets at initial recognition.

(b) Recognition and measurement

Amortised cost

Trade and other receivables are recognised initially at the amount of consideration that is unconditional, unless they contain significant financing components, in which case they are recognised at fair value. The group holds the trade and other receivables with the objective of collecting the contractual cash flows, and so it measures them subsequently at amortised cost using the effective interest method.

The group classifies its financial assets 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 the contractual cash flows; and 

·      the contractual terms give rise to cash flows that are solely payments of principle and interest. 

(c)  Impairment of financial assets

The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

For trade receivables (not subject to provisional pricing) and other receivables due in less than 12 months, the Group applies the simplified approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but instead, recognises a loss allowance based on the financial asset's lifetime ECL at each reporting date.

The Group considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Group may also consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows and usually occurs when past due for more than one year and not subject to enforcement activity.

At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

(d)           Derecognition

The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity.

On derecognition of a financial asset measured at amortised cost, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognised in profit or loss. This is the same treatment for a financial asset measured at FVTPL.

2.12 Financial Liabilities

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The Group's financial liabilities include trade and other payables.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

Trade and other payables

After initial recognition, trade and other payables are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in the statement of profit or loss and other comprehensive income when the liabilities are derecognised, as well as through the EIR amortisation process.

Amortised cost is calculated by considering any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit or loss and other comprehensive income.

Derecognition

A financial liability is derecognised when the associated obligation is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss and other comprehensive income.

Fair value

All assets and liabilities for which fair value is measured or disclosed in the consolidated Financial Statements are categorised within the fair value hierarchy. The fair value hierarchy prioritises the inputs to valuation techniques used to measure fair value. The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments and other assets and liabilities for which the fair value was used:

-       level 1: quoted prices in active markets for identical assets or liabilities;

-       level 2: inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and

-       level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

2.13 Cash and Cash Equivalents

Cash and cash equivalents comprise cash at bank and in hand.

2.14 Taxation

Tax for the period comprises current and deferred tax.  Tax is recognised in the income statement, except to the extent that it relates to items recognised directly in equity.  In this case the tax is also recognised directly in other comprehensive income or directly in equity, respectively.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company's subsidiaries and associates operate and generate taxable income.  Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation.  It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated Financial Statements. However, the deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit or loss.  Deferred income tax is determined using tax rates (and laws) that have been enacted, or substantially enacted, by the end of the reporting period 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 only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax liabilities are provided on taxable temporary differences arising from investments in subsidiaries, associates and joint arrangements, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by the group and it is probable that the temporary difference will not reverse in the foreseeable future. Generally the group is unable to control the reversal of the temporary difference for associates. Only where there is an agreement in place that gives the group the ability to control the reversal of the temporary difference not recognised.

Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries, associates and joint arrangements only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the temporary difference can be utilised.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities, and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

2.15 Share Capital, share premium and other reserves

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity, as a deduction, net of tax, from the proceeds provided there is sufficient premium available. Should sufficient premium not be available placing costs are recognised in the Income Statement.

Other reserves consist of the share option reserve and the foreign exchange translation reserve. See Notes 16 and 17 for further detail.

2.16 Reverse acquisition reserve

The reverse acquisition reserve arose on the acquisition of Kibe Investments No. 2 Limited in 2010. There has been no movement in the reserve since that date.

2.17 Share Based Payments

The Group operates a number of equity-settled share-based schemes, under which the entity receives services from employees or third-party suppliers as consideration for equity instruments (shares, options and warrants) of the Group.  The Group may also issue warrants to share subscribers as part of a share placing. The fair value of the equity-settled share based payments is recognised as an expense in the income statement or charged to equity depending on the nature of the service provided or instrument issued.  The total amount to be expensed or charged in the case of options is determined by reference to the fair value of the options or warrants granted:

·      including any market performance conditions;

·      excluding the impact of any service and non-market performance vesting conditions (for example, profitability or sales growth targets, or remaining an employee of the entity over a specified time period); and

·      including the impact of any non-vesting conditions (for example, the requirement for employees to save).

In the case of shares and warrants the amount charged to the share premium account is determined by reference to the fair value of the services received if available. If the fair value of the services received is not determinable the shares are valued by reference to the market price and the warrants are valued by reference to the fair value of the warrants granted as described previously.

Non-market vesting conditions are included in assumptions about the number of options or warrants that are expected to vest. The total expense or charge is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied.  At the end of each reporting period, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in the income statement or equity as appropriate, with a corresponding adjustment to another reserve in equity.

When the warrants or options are exercised, the Company issues new shares.  The proceeds received, net of any directly attributable transaction costs, are credited to share capital (nominal value) and share premium when the warrants or options are exercised.

2.18 Leases

The Group leases certain property.

The lease liability is initially measured at the present value of the lease payments that are not paid. Lease payments generally include fixed payments less any lease incentives receivable. The lease liability is discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate. The Group estimates the incremental borrowing rate based on the lease term, collateral assumptions, and the economic environment in which the lease is denominated. The lease liability is subsequently measured at amortised cost using the effective interest method. The lease liability is remeasured when the expected lease payments change as a result of new assessments of contractual options and residual value guarantees.

The right-of-use asset is recognised at the present value of the liability at the commencement date of the lease less any incentives received from the lessor. Added to the right-of-use asset are initial direct costs, payments made before the commencement date, and estimated restoration costs. The right-of-use asset is subsequently depreciated on a straight-line basis from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in lease liabilities, split between current and non-current depending on when the liabilities are due. The interest element of the finance cost is charged to the Statement of Profit and Loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Assets obtained under finance leases are depreciated over their useful lives. The lease liabilities are shown in Note 14.

Exemptions are applied for short life leases and low value assets, with payment made under operating leases charged to the Consolidated Statement of Comprehensive Income on a straight-line basis of the period of the lease.

2.19 Revenue Recognition

Revenue is recognised in respect of amounts recharged to project strategic partners in accordance with their contractual terms. Revenue is also generated from management and consulting services to third parties.

The Group derives revenue from the transfer of services overtime and at a point in time in the service lines detailed below. Revenues from external customers come from consulting services.

The Group provides management services to subsidiary undertakings and joint venture entities for a fixed monthly fee. Revenue from providing services is recognised in the accounting period in which the services are rendered. Efforts to satisfy the performance obligation are expended evenly throughout the performance period and so the performance obligation is considered to be satisfied evenly over time.

2.20 Finance Income

Finance income consists of bank interest on cash and cash equivalents which is recognised using the effective interest rate method.

2.21 Discontinued Operations

A discontinued operation is a component of the Group's business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which:

•      represents a separate major line of business or geographic area of operations;

•      is part of a single co-ordinated plan to dispose of a separate major line of business or geographic area of operations; or

•      is a subsidiary acquired exclusively with a view to resale. Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria to be classified as held-for-sale.

When an operation is classified as a discontinued operation, the comparative statement of profit or loss and OCI is represented as if the operation had been discontinued from the start of the comparative year.

3.    Financial Risk Management

3.1  Financial Risk Factors

The Group's activities expose it to a variety of financial risks being market risk (including, interest rate risk, currency risk and price risk), credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance.

Market Risk

(a)   Foreign currency risks

The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the USD and Euros against the UK pound. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations. The Group negotiates all material contracts for activities in relation to its subsidiary in USD and Euros. The Directors will continue to assess the effect of movements in exchange rates on the Group's financial operations and initiate suitable risk management measures where necessary.

(b) Price risk

The Group is not exposed to commodity price risk as a result of its operations, which are still in the exploration phase. Other than insignificant consulting revenue, there is no revenue. The Directors will revisit the appropriateness of this policy should the Group's operations change in size or nature.

The Group has no exposure to equity securities price risk, as it has no listed equity investments.

(c) Interest rate risk

As the Group has no borrowings, it is not exposed to interest rate risk on financial liabilities. The Group's interest rate risk arises from its cash held on short-term deposit, which is not significant.

Credit Risk

Credit risk arises from cash and cash equivalents as well as outstanding receivables. Management does not expect any losses from non-performance of these receivables.

The amount of exposure to any individual counter party is subject to a limit, which is assessed by the Board. No credit limits were exceeded during the reporting period, and management does not expect any losses from non-performance by these counterparties.

The Group considers the credit ratings of banks in which it holds funds in order to reduce exposure to credit risk.

Liquidity Risk

In keeping with similar sized mineral exploration groups, the Group's continued future operations depend on the ability to raise sufficient working capital through the issue of equity share capital. The Directors are confident that adequate funding will be forthcoming with which to finance operations. Controls over expenditure are carefully managed. In January 2024, the Company raised net proceeds of £3m. See note 2.4 for further details on going concern and liquidity.

3.2  Capital Risk Management

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern, in order to provide returns for shareholders and to enable the Group to continue its exploration and evaluation activities.  The Group has no debt at 31 December 2023 and defines capital based on the total equity of the Company being £6.9m. The Group monitors its level of cash resources available against future planned exploration and evaluation activities and may issue new shares in order to raise further funds from time to time.

4.    Critical Accounting Estimates and Judgements

The preparation of the Group Financial Statements in conformity with IFRSs requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amount of expenses during the year. Actual results may vary from the estimates used to produce these Financial Statements.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Significant items subject to such estimates and assumptions include, but are not limited to:

Impairment of exploration and evaluation costs

Exploration and evaluation costs have a carrying value at 31 December 2023 of £2,869,667 (2022: £3,337,598): refer to Note 9 for more information. The Group has a right to renew exploration permits and the asset is only depreciated once extraction of the resource commences. Management tests annually whether exploration projects have future economic value in accordance with the accounting policy stated in Note 2.7. Each exploration project is subject to an annual review by either a consultant or senior company geologist to determine if the exploration results returned during the year warrant further exploration expenditure and have the potential to result in an economic discovery.  This review takes into consideration the expected costs of extraction, long term metal prices, anticipated resource volumes and supply and demand outlook.  In the event that a project does not represent an economic exploration target and results indicate there is no additional upside, a decision will be made to discontinue exploration.

On 24 February 2024, the Company announced that management had undertaken an assessment of the Company's non-core assets and as a consequence decided not to extend the Gindalbie Tribute Agreement which was due to expire on 24 February 2024. As a result, the previously capitalised exploration costs related to Gindalbie totalling £527,245 have been fully impaired as at 31 December 2023.

Held for sale assets

The Company is working on a potential divestment of the Eclipse project and are actively engaged with a number of Australian companies operating in the gold mining sector to find a buyer. Management are committed to the sale of the Eclipse licence and given the recent increase in the gold price this asset has become significantly more attractive. The expectation is that this sale will be completed in the next 6 months.

 As a result, this asset has been reclassified as held for sale. The carrying value of the Eclipse Project is £1.744 million. This represents the acquisition cost plus the carried forward exploration expenditure. An initial assessment study resulted in an anticipated operating profit from the Eclipse shaft gold target of A$3.8 million (approx. £2 million). This represents only one target within the licence area with multiple targets offering further high-grade gold discovery potential. As a result, management believe the fair value less costs to sell is in excess of the carrying value and as a result, continue to value the asset at the existing carrying value.

Share based payment transactions

The Group has made awards of options and warrants over its unissued share capital to certain Directors and employees as part of their remuneration package. Certain warrants have also been issued to shareholders as part of their subscription for shares and to suppliers for various services received.

The valuation of these options and warrants involves making a number of critical estimates relating to price volatility, future dividend yields, expected life of the options and forfeiture rates.  These assumptions have been described in more detail in Note 17.

5.    Segmental Information

As at 31 December 2023, the Group operates in three geographical areas, the UK, Austria and Australia. The Company operates in one geographical area, the UK. Activities in the UK are mainly administrative in nature whilst activities in Austria and Australia relate to exploration and evaluation work. The reports used by the chief operating decision maker are based on these geographical segments.

The Group generated no revenue during the year ended 31 December 2023: £nil (2022: £nil).

Segment assets and liabilities are allocated based on geographical location.

6. Expenses by Nature

7.    Taxation

The tax on the Group's loss differs from the theoretical amount that would arise using the weighted average tax rate applicable to the losses of the consolidated entities as follows:

No charge to taxation arises due to the losses incurred.

The weighted average applicable tax rate of 24% (2022: 23%) used is a combination of the 25% standard rate of corporation tax in the UK (2022: 19%), 24% Austrian corporation tax (2022: 25%) and 25% Australian corporation tax.

The Group has accumulated tax losses of approximately £7,440,998 (2022: £7,110,000) available to carry forward against future taxable profits. A deferred tax asset has not been recognised because of uncertainty over future taxable profits against which the losses may be utilised.

​

8.    Property, Plant and Equipment

The right of use asset shown above is an asset in use by the Group's subsidiary undertaking and represents leasehold premises. Please refer to Note 14.

9.    Intangible Assets

The Exploration & Evaluation additions in the current period primarily relates to work performed at the Company's Pitfield project. An initial drill programme consisting of 21 RC drill holes were completed in April of this year, following on from extensive geophysics and geochemistry programmes., The Company has since commenced a second phase of diamond drilling at Pitfield with this to be followed by a third phase of RC drilling later this year. A total of 20,000 combined diamond and RC drilling has now been completed as of the date of this report. The Company is now advancing detailed mineralogical and metallurgical studies with a view to undertaking resource drilling towards the end of the year along with pilot plant and process flow sheet design.

Eclipse-Gindalbie Project

In 2020 the Group acquired an option to purchase 75% of the Eclipse Gold license. The option was exercised in February 2021 for a consideration of AUD$1,000,000 (approximately £550,000) in cash and AUD$500,000 (£277,750) settled via the issue of 7,095,510 new ordinary shares of no-par value at a price of 3.91p.

In January 2022, the Group entered into a Tribute Agreement for the Gindalbie license. The cost to enter into the Tribute Agreement was AUD$250,000 for an initial 6-month exploration term. An additional A$250,000 was paid in August 2022 to extend the exploration period by a further 18 months.

In February 2022, 1,676m of Reverse Circulation ("RC") drilling was completed, focused mainly on the Homeward Bound, Laurel-Bulletin, South Gippsland #3, Golden Puzzle and Bud's Find areas. Of the four RC holes drilled at the Homeward Bound target, three reported very high-grade intercepts.

Following from this, a further six Diamond Drill ("DD") holes for a total of 999m were completed at Eclipse during the year to test for continuity between Eclipse and Jack's Dream and to the north-west of Jack's Dream. Five of the six DD holes intercepted the mineralised shear reporting significant gold intercepts.

Following on from successful drilling campaigns in February 2022 and June 2022, the Company decided to carry out a small RC campaign consisting of nine RC drill holes for 770m. The Company found evidence of kaolinite-rich clays within the intensely leached upper part of the weathering profile.

On 24 February 2024, the Company announced that management had undertaken an assessment of the Company's non-core assets and as a consequence decided not to extend the Gindalbie Tribute Agreement which was due to expire on 24 February 2024. As a result, the previously capitalised exploration costs related to Gindalbie totalling £528,838 have been fully impaired as at 31 December 2023.

The Eclipse project has also been reclassified as an Asset Held for Sale as the Company works on a potential divestment of this asset. Please refer to Note 11.

Pitfield Project

The Company acquired a 70% interest in the Pitfield project from Century Minerals Pty Ltd ('Century') on 13 April 2022. The consideration for the acquisition was satisfied by the issue of 5,611,863, new ordinary shares to Century.

In accordance with IFRS 6, the Directors undertook an assessment of the following areas and circumstances which could indicate the existence of impairment:

•    The Group's right to explore in an area has expired or will expire in the near future without renewal.

•    No further exploration or evaluation is planned or budgeted for.

•    A decision has been taken by the Board to discontinue exploration and evaluation in an area due to the absence of a commercial level of reserves.

•    Sufficient data exists to indicate that the book value may not be fully recovered from future development and production

Based on the above assessment, management does not consider there to be any indicators present over the Pitfield project, in accordance with the criterion of IFRS 6. As such, the Board do not believe that any impairment is necessary.

Walton Project

The Company acquired a 70% interest in the Walton project from Century on 24 April 2023. The consideration for the acquisition was satisfied by the issue of 5,611,863, new ordinary shares to Century.

In accordance with IFRS 6, the Directors undertook an assessment of the following areas and circumstances which could indicate the existence of impairment:

•    The Group's right to explore in an area has expired or will expire in the near future without renewal.

•    No further exploration or evaluation is planned or budgeted for.

•    A decision has been taken by the Board to discontinue exploration and evaluation in an area due to the absence of a commercial level of reserves.

•    Sufficient data exists to indicate that the book value may not be fully recovered from future development and production.

Based on the above assessment, management does not consider there to be any indicators present over the Pitfield project, in accordance with the criterion of IFRS 6. As such, the Board do not believe that any impairment is necessary.

10.  Trade and Other Receivables

Other receivables are all due within one year. The fair value of all receivables is the same as their carrying values stated above. These assets, excluding prepayments, are the only form of financial asset within the Group, together with cash and cash equivalents.

Cash in transit relates to funds sent from Empire Metals Limited to Eclipse Exploration Pty Ltd at the year end.

The carrying amounts of the Group's other receivables are denominated in the following currencies:

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable mentioned above. The Group does not hold any collateral as security. All trade and other receivables are considered fully recoverable and performing.

11.  Held For Sale Asset

The Company is working on a potential divestment of the Eclipse project and are actively engaged with a number of Australian companies operating in the gold mining sector to find a buyer. Management are committed to the sale of the Eclipse licence and given the recent increase in the gold price this asset has become significantly more attractive. The expectation is that this sale will be completed in the next 6 months.

 As a result this asset has been reclassified as held for sale. The carrying value of the Eclipse Project is £1.744 million. This represents the acquisition cost plus the carried forward exploration expenditure. An initial assessment study resulted in an operating profit from the Eclipse shaft gold target of A$3.8 million (approx. £2 million). This represents only one target within the licence area with multiple targets offering further high-grade gold discovery potential. As a result, management believe the fair value less costs to sell is in excess of the carrying value and as a result, continue to value the asset at the existing carrying value.

12.   Cash and Cash Equivalents

The Group's cash is held with facilities with AA and A credit ratings.

The carrying amounts of the Group and Company's cash and cash equivalents are denominated in the following currencies:

13.  Trade and Other Payables

The carrying amounts of the Group's trade and other payables are denominated in the following currencies:

14.   Lease Liabilities

Lease Liabilities

Lease liabilities are effectively secured, as the rights to the leased asset revert to the lessor in the event of default.

Please refer to Note 8 for further details on the right of use asset.

For the year ended 31 December 2023, the total finance charges were £977 (2022: £nil).

The contracted and planned lease commitments were discounted using a weighted average incremental borrowing rate of 6%.

The present value of right of use liabilities is as follows:

15.   Share Capital and Share Premium

On 15 December 2010 the shareholders approved the removal of the Company's authorised share capital and so there is no limit on the number of shares the Company is authorised to issue. On that date the shareholders also approved the removal of the nominal value of the shares, as permitted under local company legislation. As such all amounts raised are considered to be share premium.

Issued share capital

On 22 February 2021, the Company issued and allotted 7,095,510 new Ordinary Shares at a price of 3.9 pence per share as consideration for the purchase of 75% of the equity of Eclipse Exploration Pty. The Company issued and allotted a further 7,095,510 new Ordinary Shares at the same price as payment of a finder's fee in respect of the Eclipse transaction.

On 20 May 2021, the Company issued and allotted 1,921,068 new Ordinary Shares at a price of 2.85 pence per share as consideration for the purchase of 75% of the equity of Central Menzies. The Company issued and allotted a further 1,921,068 new Ordinary Shares at the same price as payment of a finder's fee in respect of the Central Menzies transaction.

On 10 June 2021, pursuant to the advisory agreement, a fee of US$150,000 settled via the issue of 3,995,238 new ordinary shares in the Company at a price of 2.65p were allotted to the Company's Georgian advisor.

On 13 April 2022, following completion on Pitfield Copper Project, the Company issued 5,611,863 consideration shares to Century Minerals Pty Ltd.

On 28 April 2022, the Company announced a placing of 85,000,000 new ordinary shares of no par value, at a price of 2p.

On 13 March 2023 the Company completed a placing to raise £1.25 million before expenses by way of a placing of 55,555,554 new ordinary shares of no par value in the capital at a price of 4p.

On 26 April 2023, following completion on the Walton Copper-Gold-Lithium Project, the Company issued 5,611,863 consideration shares.

On 27 April 2023 the Company received notification from a warrant holder to exercise warrants over 1,500,000 new ordinary shares of no par value in the share capital of the Company at a price of 1.3p per share.

On 15 August 2023, the Company received notification from a warrant holder to exercise warrants over 773,333 new ordinary shares of no par value in the share capital of the Company at a price of 3.375p per share and 1,600,000 new ordinary shares of no par value in the share capital of the Company at a price of 3p per share. The Company issued new ordinary shares to the warrant holders for an aggregate cash value of £74,099.99.

On 25 September 2023, the Company issued 75,000,000 new ordinary shares at a price of 4p per share for gross proceeds of £3,000,000.

On 29 November 2023, the Company received notification from a warrant holder to exercise warrants over 1,876,553 new ordinary shares of no par value in the share capital of the Company at a price of 1.3p per share. The Company issued new ordinary shares to the warrant holders for an aggregate cash value of £24,395.

On 8 December 2023, the Company received notification from an option holder to exercise options over 500,000 new ordinary shares of no par value in the share capital of the Company at a price of 4p per share and 500,000 new ordinary shares of no par value in the share capital of the Company at a price of 5.5p per share. The Company issued new ordinary shares to the option holders for an aggregate cash value of £47,500.

On 26 December 2023 the Company received notification from a warrant holder to exercise warrants over 1,336,875 new ordinary shares of no par value in the share capital of the Company at a price of 6p per share.

16.  Other reserves

Foreign currency translation reserve - the foreign currency translation reserve represents the effect of changes in exchange rates arising from translating the Financial Statements of subsidiary undertakings into the Company's presentation currency.

Share option reserve - the share option reserve represents the fair value of share options and warrants in issue. The amounts included are recycled to share premium on exercise or recycled to retained earnings on expiry. Note 17 outlines the share based payments made in the year.

17.  Share Based Payments

Warrants and options outstanding at 31 December 2023 have the following expiry dates and exercise prices, and were valued using the Black Scholes model using the assumptions below:

The risk free rate of return is based on zero yield government bonds for a term consistent with the warrant and option life.  Volatility is calculated using an average of the Company's share price 6 months prior to the granted date.

The movement of options and warrants for the year to 31 December 2023 is shown below:

The total fair value charged to the statement of comprehensive income for the year ended 31 December 2023 and included in administrative expenses was £801,194 (2022: £58,220).

18.  Other losses

19.  Employees

The average monthly number of employees during the year was 3 (2022: 2).

20.  Directors' Remuneration

*Resigned 8 June 2022

21.  Earnings per Share

Continuing operations

The calculation of the total basic losses per share of 0.560 pence (2022: loss 0.292 pence) is based on the losses attributable to equity owners of the group of £2,796,461 (2022: £1,162,720) and on the weighted average number of ordinary shares of 498,087,397 (2022: 398,508,796) in issue during the period.

In accordance with IAS 33, basic and diluted earnings per share are identical in 2023 as the effect of the exercise of share options or warrants would be to decrease the loss per share as the entity is loss making, these instruments are anti-dilutive.

22.  Commitments

(a) Work programme commitment

The Eclipse Mining Licence has an annual minimum expenditure commitment of AUD$30,300.

The Pitfield/Walton Projects have an annual minimum expenditure commitment of AUD$435,500 across all licences.

(b) Royalty agreements

As part of the contractual arrangement with Kibe No.1 Investments Limited the Group has agreed to pay a royalty on revenue from gold sales arising from gold mines developed by Noricum Gold AT GmbH and covered by licenses acquired by Kibe No.1 Investments Limited. Under the terms of the Royalty Agreement between Kibe No.1 Investments Limited and Noricum Gold AT GmbH, the Group shall pay royalties, based on total ounces of gold sold, equal to US$1 for every US$250 of the sale price per ounce.

(c) Lease agreements

During the period Eclipse Exploration Pty Ltd, a wholly owned subsidiary of Empire Metals Limited, entered into a two year office lease of AUD$40,575 per annum. At the year end the commitment amounted to AUD$39,923. Please refer to Note 14.

23.  Financial instruments

Financial instruments measured at fair value

The fair value hierarchy of financial instruments measured at fair value is provided below. The different levels have been defined as follows:

-      Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),

-      Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly (level 2),

-      Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

Cost may be an appropriate estimation of fair value at the measurement date only in limited circumstances, such as for a pre-revenue entity when there is no catalyst for change in fair value, or the transaction date is relatively close to the measurement date. The financial asset relates to costs incurred with the acquisition of an option to invest in a 75% holding of Eclipse Exploration PTY. Further detail can be found in note 9.

Group

At the year end, the Company had no assets held at fair value with the exception of the asset held for sale. Refer to Note 11 for further detail. There were no assets held at fair value as at 31 December 2022.

24.  Related Party Transactions

Loans provided by Parent Company

As at 31 December 2023 there were amounts receivable of £12,803 (2022: £10,933) from Kibe No.2 Investments Limited. No interest was charged on the loans.

As at 31 December 2023 there were amounts receivable of £696,226 (2022: £696,186) from European Mining Services Limited.

As at 31 December 2023 there were amounts receivable of £6,472,444 (2022: £4,376,213) from Eclipse Exploration Pty Ltd.

As at 31 December 2023 there were amounts receivable of £155,325 (2022: £145,325) from Noricum AT GmbH.

As at 31 December 2023 there were amounts receivable of £53,202 (2022: £51,602) from GMC Investments Limited.

Loans provided by Kibe No.2 Investments Limited

As at 31 December 2023 there were amounts receivable of £754,517 (2022: £754,517) from Noricum AT GmbH.

All intra-group transactions are eliminated on consolidation.

Other Transactions

Westend Corporate LLP, an entity in which Gregory Kuenzel is a partner, was paid a fee of £73,858 (2022: £84,040) for accounting and corporate services to the Group. At the year end there was nothing outstanding (2022: £7,124).

MOAR Consulting Inc, an entity in which Neil O'Brien is a beneficiary provided geological consulting services to Eclipse Exploration Pty Ltd. Total charges for the year ended 31 December 2023 were CAD$84,717 (2022: £0)

Silvergate Capital Partners Ltd an entity in which Peter Damouni is a beneficiary, was paid a fee of £15,000 (2022: £0) for business development services to the Group.

During the period invoices totalling AUD$38,439 were paid to Century Minerals Pty Ltd (2022: AUD$119,918).

25.  Ultimate Controlling Party

The Directors believe there to be no ultimate controlling party.

26.  Events after the Reporting Date

On 22 January 2024 the Company completed a placing to raise £3 million before expenses by way of a placing of 27,272,728 new ordinary shares of no par value in the capital.

On 29 February 2024 the Company agreed to issue options over a total of 8,500,00 ordinary shares of no-par value to employees of the Group.

On 26 April 2024, it was announced management had undertaken an assessment of the Company's non-core assets and as a consequence decided not to extend the completion date for the acquisition of the Stavely Project, located in Victoria, which expired on 6 April 2024, and as a consequence the acquisition has been terminated.