0000766011 Caledonia Mining Corp Plc false --12-31 FY 2023 2 75 10 10 15 15 5 5 10 10 4 4 10 10 4 4 3 3 6 6 65.677 12.82 4,425,797 12.82 441,095 12.82 256,152 12.82 10 3 1 3 0 3 0 10 0 0 6,105 20,945 1,000 1,000 1,900 176 2,400 0 0 4 1.71 2.12 101 0 3.14 3.29 10 5 350 0 4 3.8 5 5 3.5 3.4 3.5 3.5 2 2 0 0 0 0 0 7.25 0 0.11 0.12 0.13 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.5 2 0 0 6,179 6,683 8,700 5,329 48,149 36,597 217 561 142,082 0 0 0 0 Cost incurred by CHZ between the effective date ( August 1, 2022) and the commencement date of the oxide mining operations ( December 1, 2022) relating to administration and other general costs. These costs were incurred to maintain the operational integrity of the oxide mine and do not relate to direct costs of bringing the oxide mine to the location and condition necessary for it to be capable of operating in the manner intended by CHZ. Amount inclusive of $104 (2022: $354, 2021: $123) classified as production costs. Other expenses include impairment of plant and equipment of $26 for Blanket and $851 for the Bilboes oxide mine, as well as impairment of the solar VAT and duty receivable amounting to $720 for Blanket. Assessed losses of Greenstone Management Services (Pty) Ltd (UK) are not carried over and reset to zero each year. On December 7, 2021 a duty rebate on the importation of capital goods was granted to the Company in terms of the Customs and Excise General Regulations of 2001. However, the customs officials at Forbes Border Post rejected a rebate on solar cables despite presentation of a valid rebate letter. An appeal was made to the Commissioner of Taxes seeking the rebate and the outcome of the appeal was unfavourable. Interest paid on bank overdraft was $1,657 (2022: $192). Refer to note 6 for the effective shareholding. NCI has a 13.2% (2022: 13.2%, 2021: 13.2%) interest in cash flows of Blanket only. Accounted for under IAS19 Employee Benefits. In 2019 ZIMRA issued PN26 that was affected retrospectively from February 22, 2019. The public notice provided clarity on Section 4 (a) of the Finance Act [Chapter 23.04] of Zimbabwe, which required that the calculation of taxable income be performed in RTGS$ and that the payment of the tax be in the ratio of the currency that the taxable income and revenue is earned. The reconciling item reconciled the profit before tax calculated using US Dollars as the functional currency of the Zimbabwean entities to taxable income calculated in RTGS$. PN26 was superseded by Section 37AA of the Income Tax Act [Chapter 23:06] of Zimbabwe, which requires taxpayers to submit separate tax returns where any part of the income from trade or investment is earned in foreign currency. Section 37AA stated that the calculation of taxable income be expressed in foreign currency and RTGS$ and that the payment of the tax payable be made proportionately to reflect the percentage share of income earned in all foreign currencies and the percentage earned in Zimbabwe dollars. The section further provides that the RTGS$ should be converted to US$ using the average auction rate of exchange for the year of assessment, with the same being applicable to US$ amounts that need to be converted to RTGS$. Caledonia completed sufficient work to establish that the potential orebody at the Connemara North property would not meet Caledonia’s requirements in terms of size, grade and width. Accordingly, Caledonia did not exercise the option to acquire the property. The costs have been impaired to $Nil. Assessed losses of Bilboes of $3,763 was acquired during 2023. Bilboes Holdings was acquired on January 6, 2023. No production for 2022 and 2021. Employees, officers, directors, consultants and other service providers also participate in the OEICP (see note 12.1). Gross proceeds of $10,770 with a transaction cost of $846 were raised by issuing depository interests on the AIM of the London Stock Exchange Gross proceeds of $5,850 with a transaction cost of $205 were raised by issuing depository receipts on the VFEX. During quarter one of 2023, Mark Learmonth, Chief Executive Officer, and Toziyana Resources Limited, a company affiliated with Victor Gapare, executive Director of the Company, subscribed for 3,587 and 11,000 depositary interests respectively in the equity raise. The effective tax rate of 105.07% (2022: 42.31%) exceeds the statutory tax rates of subsidiaries of the Company, as certain expenditures are incurred by the Company that are not tax-deductible against taxable income in Zimbabwe and South Africa, where the enacted tax rates are 24.72% (2022: 24.72%) and 27.00% (2022: 28%) respectively. Facilitation loans are accounted for as equity instruments and are accordingly not recognised as loans receivable. Realised foreign exchange losses were predominantly recognised on bullion sales receivables, bank balances and RTGS$ VAT. Included in consumables stores is an amount of ($1,793) (2022: ($1,510)) for provision for obsolete stock for items that are not compatible with plant and equipment currently in use. After December 31, 2023 the RTGS$:USD conversion rate devalued from RTGS$ 6,105:USD 1 to RTGS$ 20,945:USD 1 on March, 25 2024. The devaluation in the exchange rate will devalue RTGS$-denominated monetary assets in quarter 1, of 2024. Cash of $2,456 (denominated in RTGS$) held by Blanket Mine was earmarked by Stanbic Bank Zimbabwe as a letter of credit in favour of CMSA. The letter of credit was issued by Stanbic Bank Zimbabwe on November 28, 2023 and settled in January, 2024. The cash on maturity was transferred to CMSA’s bank account, denominated in South African Rands. The Company entered into a consultancy agreement with SR Curtis, a director of the Company, effective July 1, 2022 until December 31, 2023 at a monthly fee of $44.1 from July 1, 2022 until December 31, 2022 and $12.5 from January 1, 2023 until December 31, 2023. During the period ended December 31, 2023, the Company recorded $150 (2022: $265, 2021: $Nil) in consultancy fees. The Company has extended Mr. Curtis’ consultancy agreement until December 31, 2025 at a monthly fee of $12.5. Mr. Curtis is retiring as a director from the next annual general meeting (planned for May 7, 2024). Included is an amount of $647 (2022: $1,378, 2021: $1,011) that relates to bonuses provided or paid for in 2023. Included is an amount of $1,588 (2022: $54 (leave payout), 2021: $Nil) that relates to provision of a severance package payable in 2024 Included in the 2022 impairments are development asset costs of $8,518 that predominantly relates to prospective areas above 750 meters at Blanket which are not included in the LoMP. Also included in the 2022 impairments are generator cost of $791 and loader bottom decks at a cost of $101; these assets were no longer in working condition. The carrying amount for these impaired assets were impaired to $Nil. The solar plant was fully commissioned on February 2, 2023 and the sale agreement between Caledonia Mining Corporation Plc and Caledonia Mining Services (Private) Limited was concluded for the sale of the solar plant. Depreciation on the solar plant commenced on February 2, 2023 and the power purchase agreement, between Caledonia Mining Services (Private) Limited and Blanket Mine, became effective. From September 28, 2023 the solar plant is classified as held for sale. In December 2022, the Caledonia board approved a proposal for Caledonia Mining Services (Private) Limited (which owns the solar plant) to issue loan notes pursuant to a loan note instrument (“bonds”) up to a value of $12 million. The decision was taken in order to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market. Refer to note 30.2 for more information on these loan notes. The net deferred tax liability consists of a deferred tax asset of $153 (2022: $202) from the South African operation and a net deferred tax liability of $6,131 (2022: $5,123) due to the Zimbabwean operation. The amounts are in different tax jurisdictions and cannot be offset. The amounts are presented as part of non-current assets and non-current liabilities in the statements of financial position. The deferred tax asset recognised is supported by evidence of probable future taxable income. Included in additions is the change in estimate for the decommissioning asset of $1,962 (2022: ($468)) Accumulated depreciation and depreciation under Assets under construction and decommissioning assets include depreciation on decommissioning assets. Intermediated Money Transfer Tax ("IMTT”) is tax chargeable in Zimbabwe on transfer of physical money, electronically or by any other means, between two or more persons. IMTT is levied at a rate of 2% on RTGS$ denominated transactions and 1% on local foreign currency denominated transactions and outbound foreign payments. The tax rate in Jersey, Channel Islands is 0% (2022: 0%, 2021: 0%). Other expenses include impairment of plant and equipment of $8,209 for Blanket, as well as impairment of the Connemara North of $720. On June 27, 2023 the decision was taken to place the Bilboes oxide mine on care and maintenance as the cost related to removing the waste and accessing the orebody could exceed the benefit from the gold revenues to be received. The impairment loss that was recognised amounted to a carrying value of $851 on impairing the Bilboes oxide asset classified under mine development, infrastructure and other. Mining and metallurgical processing continued at the Bilboes oxide mine until the end of September 2023 when the contract miner's notice period came to an end. Leaching of material that has already been deposited on the leach pad will continue while the revenue from these activities contributes to the cost of the asset. Oxide mining and processing will resume when the stripping of the waste for the sulphide project commences and can be economically justified. BETS and the Community Trust are consolidated as structured entities. 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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
| OR
☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| For the fiscal year ended December 31, 2023
| OR
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| OR
☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 193
| Date of event requiring this shell company report ……………………………………………
| For the transition period from ……………………………… to ………………………………

Commission file number 001-38164

Caledonia Mining Corporation Plc

(Exact name of Registrant as specified in its charter)

Jersey, Channel Islands

(Jurisdiction of incorporation or organization)

Caledonia Mining Corporation Plc

B006 Millais House, Castle Quay, St Helier, Jersey, JE2 3EF

(Address of principal executive offices)

Mark Learmonth, +44 1534 679 800, mlearmonth@caledoniamining.com, B006 Millais House, Castle Quay, St Helier, Jersey Channel Islands, JE2 3EF.

(Name, telephone, email and/or facsimile number and address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of Class | Trading Symbol(s) | Name of Each Exchange on Which Registered
Common Shares, no par value | CMCL | NYSE American LLC

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

1

Indicate the number of outstanding shares of each of the issuer’s classes of capital or stock as of the closing of the period covered by the annual report:

19,188,073 (“Common shares” or “shares”) as of December 31, 2023

Indicate by check mark if the registration is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐Yes ☒ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

☐Yes ☒ No

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

☒Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, and/or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer ☐ | Accelerated filer ☒
Non-accelerated filer ☐ | Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

2

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP | ☐ | International Financial Reporting Standards as issued by the International Accounting Standards | ☒ | Other | ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow:

Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐Yes ☒ No

3

TABLE OF CONTENTS

PART I | 10
ITEM 1 - IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS | 10
ITEM 2 - OFFER STATISTICS AND EXPECTED TIMETABLE | 10
ITEM 3 - KEY INFORMATION | 10
A. [Reserved] | 10
B. Capitalization and Indebtedness | 10
C. Reasons for the Offer and Use of Proceeds | 10
D. Risk Factors | 10
ITEM 4 - INFORMATION ON THE COMPANY | 27
4.A. History and Development of the Company | 27
B. Business Overview | 31
C. Organizational Structure | 38
D. Property, Plant and Equipment and Exploration and evaluation assets | 39
ITEM 4A - UNRESOLVED STAFF COMMENTS | 77
ITEM 5 - OPERATING AND FINANCIAL REVIEW AND PROSPECTS | 77
A. Operating Results | 77
B. Liquidity and Capital Resources | 87
C. Research and development, patents and licenses, etc. | 89
D. Trend Information | 89
E. Critical Accounting Estimates | 89
ITEM 6 - DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES | 90
A. Directors and Senior Management | 90
B. Compensation | 96
C. Board Practices | 98
D. Employees | 100
E. Share Ownership | 100
F. Disclosure of Registrant’s Action to Recover Erroneously Awarded Compensation | 101
ITEM 7 - MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS | 101
A. Major Shareholders | 101
B. Related Party Transactions | 102
C. Interests of Experts and Counsel | 102
ITEM 8 - FINANCIAL INFORMATION | 102
A. Consolidated Statements and Other Financial Information | 102
B. Significant Changes | 103
ITEM 9 - THE OFFERING AND LISTING | 103
A. Offering and Listing Details | 103

4

B. Plan of Distribution | 103
C. Markets | 103
D. Selling Shareholders | 103
E. Dilution | 104
F. Expenses of the Issue | 104
ITEM 10 - ADDITIONAL INFORMATION | 104
A. Share Capital | 104
B. Memorandum and Articles of Association | 104
C. Material Contracts | 113
D. Exchange Controls | 113
E. Taxation | 113
F. Dividends and Paying Agents | 118
G. Statement by Experts | 118
H. Documents on Display | 118
I. Subsidiary Information | 118
J. Annual Report to Security Holders | 118
ITEM 11 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 118
A. Currency Risk | 119
B. Sensitivity Analysis | 119
C. Concentration of Credit Risk | 120
D. Liquidity Risk | 120
E. Market Risk - Interest Rate Risk | 120
ITEM 12 - DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES | 122
A. to C. | 122
D. | 122
PART II | 123
ITEM 13 - DEFAULTS, DIVIDEND ARREARS AND DELINQUENCIES | 123
ITEM 14 - MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS | 123
A. to D. | 123
E. Use of Proceeds | 123
ITEM 15 - CONTROLS AND PROCEDURES | 123
A. Disclosure Controls and Procedures | 123
B. Management’s annual report on internal control over financial reporting | 123
C. Attestation report of registered public accounting firm | 124
D. Changes in internal controls over financial reporting | 124
ITEM 16 - [RESERVED] | 124
ITEM 16A - AUDIT COMMITTEE FINANCIAL EXPERT | 124
ITEM 16B - CODE OF ETHICS | 124

5

ITEM 16C - PRINCIPAL ACCOUNTANT FEES AND SERVICES | 125
ITEM 16D - EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES | 125
ITEM 16E - PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS | 125
ITEM 16F - CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT | 125
ITEM 16G - CORPORATE GOVERNANCE | 125
ITEM 16H - MINE SAFETY DISCLOSURE | 126
ITEM 16I - DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS | 126
ITEM 16J – INSIDER TRADING POLICIES | 126
ITEM 16K – CYBER SECURTIY | 126
PART III | 130
ITEM 17 - FINANCIAL STATEMENTS | 130
ITEM 18 - FINANCIAL STATEMENTS | 130
ITEM 19 - EXHIBITS | 130

6

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 20-F ("Annual Report") and the exhibits attached hereto contain "forward-looking information" and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation that involve risks and uncertainties relating, but not limited to, the Company’s current expectations, intentions, plans, and beliefs. Forward-looking information can often be identified by forward-looking words such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “target”, “intend”, “estimate”, “could”, “should”, “may” and “will” or the negative of these terms or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Examples of forward-looking information in this Annual Report include: our mineral reserve and mineral resource calculations with underlying assumptions, production guidance, estimates of future/targeted production rates, planned mill capacity increases, estimates of future metallurgical recovery rates and the ability to maintain high metallurgical recovery rates, Caledonia Mining Corporation Plc and subsidiaries (“Caledonia” or “Company” or “Group”) plans and timing regarding further exploration, drilling and development, the prospective nature of exploration and development targets, the ability to upgrade and convert mineral reserves and mineral resources, capital costs, our intentions with respect to financial position and third party financing and future dividend payments. This forward-looking information is based, in part, on assumptions and factors that may change or prove to be incorrect, thus causing actual results, performance or achievements to be materially different from those expressed or implied by forward-looking information. Such factors and assumptions include, but are not limited to: failure to establish estimated mineral reserves and mineral resources, the grade and recovery of ore which is mined varying from estimates, success of future exploration and drilling programs, reliability of drilling, sampling and assay data, assumptions regarding the representativeness of mineralization being inaccurate, success of planned metallurgical test-work, capital and operating costs varying significantly from estimates, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, changes in government regulations, legislation and rates of taxation, inflation, changes in exchange rates and the availability of foreign exchange, fluctuations in commodity prices, delays in the development of projects and other factors.

Shareholders, potential shareholders and other prospective investors should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. Such factors include, but are not limited to: risks relating to estimates of mineral reserves and mineral resources proving to be inaccurate, fluctuations in gold price, risks and hazards associated with the business of mineral exploration, development and mining (including environmental hazards, industrial accidents, unusual or unexpected geological or structural formations, pressures, power outages, explosions, landslides, cave-ins and flooding), risks relating to the credit worthiness or financial condition of suppliers, refiners and other parties with whom the Company does business; inadequate insurance, or inability to obtain insurance, to cover these risks and hazards, employee relations; relationships with and claims by local communities and indigenous populations; political risk; risks related to natural disasters, terrorism, civil unrest, public health concerns (including health epidemics or outbreaks of communicable diseases such as the coronavirus); availability and increasing costs associated with mining inputs and labor; the speculative nature of mineral exploration and development, including the risks of obtaining or maintaining necessary licenses and permits, diminishing quantities or grades of mineral reserves and mineral resources as mining occurs; global financial condition, the actual results of current exploration activities, changes to conclusions of economic evaluations, and changes in project parameters to deal with un-anticipated economic or other factors, risks of increased capital and operating costs, environmental, safety or regulatory risks, expropriation, the Company’s title to properties including ownership thereof, increased competition in the mining industry for properties, equipment, qualified personnel and their costs, risks relating to the uncertainty of timing of events including targeted production rate increase and currency fluctuations. Shareholders, potential shareholders and other prospective investors are cautioned not to place undue reliance on forward-looking information. By its nature, forward-looking information involves numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Caledonia reviews forward-looking information for the purposes of preparing each annual report, however Caledonia undertakes no obligation to update publicly or otherwise revise any forward-looking information whether as a result of new information, future events or other such factors which affect this information, except as required by law. For the reasons set forth above, investors should not place undue reliance on forward-looking statements.

7

STATUS AS AN EMERGING GROWTH COMPANY

We are an “emerging growth company” as defined in Section 3(a) of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”) by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. We will continue to qualify as an "emerging growth company" until the earliest to occur of: (a) the last day of the fiscal year during which we had total annual gross revenues of US$1,235,000,000 (as such amount is indexed for inflation every 5 years by the United States Securities and Exchange Commission (“SEC”) or more; (b) the last day of our fiscal year following the fifth anniversary of the date of the first sale of equity securities pursuant to an effective registration statement under the United States Securities Act of 1933, as amended (the “Securities Act”); (c) the date on which we have, during the previous 3-year period, issued more than US$1,000,000,000 in non-convertible debt; or (d) the date on which we are deemed to be a "large accelerated filer", as defined in Exchange Act Rule 12b-2. We expect to continue to be an emerging growth company for the immediate future. During 2020 Caledonia completed the first sale of equity securities under the Securities Act and may no longer qualify as an emerging growth company in 2026. Refer to note 25 in the Consolidated Financial Statements for detail on the sales of equity securities.

Generally, a registrant that registers any class of its securities under Section 12 of the Exchange Act is required to include in the second and all subsequent annual reports filed by it under the Exchange Act a management report on internal control over financial reporting and, subject to an exemption available to registrants that are neither an "accelerated filer" or a "larger accelerated filer" (as those terms are defined in Exchange Act Rule 12b-2), an auditor attestation report on management's assessment of internal control over financial reporting. However, for so long as we continue to qualify as an emerging growth company, we will be exempt from the requirement to include an auditor attestation report on management’s assessment of internal controls over financial reporting in its annual reports filed under the Exchange Act, even if we were to qualify as an "accelerated filer" or a "larger accelerated filer". In addition, Section 103(a)(3) of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) has been amended by the JOBS Act to provide that, among other things, auditors of an emerging growth company are exempt from any rules of the Public Company Accounting Oversight Board requiring a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the company.

SPECIAL NOTE REGARDING LINKS TO EXTERNAL WEBSITES

Links to external, or third-party websites, are provided solely for convenience. We take no responsibility whatsoever for any third-party information contained in such third-party websites, and we specifically disclaim adoption or incorporation by reference of such information into this report.

NON-IFRS FINANCIAL INFORMATION

This Annual Report contains financial statements of the Company prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). In addition, this Annual Report also contains non-IFRS financial measures (“Non-IFRS Measures”) including “on-mine cost per ounce”, “all-in sustaining cost per ounce”, “all-in cost per ounce”, “average realized gold price” and “adjusted earnings per share” as we believe these are useful metrics for measuring our performance. However, these Non-IFRS Measures do not have any standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other publicly traded entities. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS.

CURRENCY

Unless otherwise indicated, all references to “$”, “US dollars”. “USD”, or "US$" are to United States of America dollars.

8

FOREIGN PRIVATE ISSUER FILINGS

We are considered a “foreign private issuer” pursuant to Rule 405 promulgated under the Securities Act. In our capacity as a foreign private issuer, we are exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our officers, directors and principal shareholders are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of our shares. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as United States companies whose securities are registered under the Exchange Act. In addition, we are not required to comply with Regulation FD, which restricts the selective disclosure of material information.

For as long as we are a “foreign private issuer” we intend to file our annual financial statements on Form 20-F and furnish our quarterly financial statements on Form 6-K to the SEC for so long as we are subject to the reporting requirements of Section 13(g) or 15(d) of the Exchange Act. However, the information we file or furnish may not be the same as the information that is required in annual and quarterly reports on Form 10-K or Form 10-Q for U.S. domestic issuers. Accordingly, there may be less information publicly available concerning us than there is for a company that files as a domestic issuer.

We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We are required to determine our status as a foreign private issuer on an annual basis at the end of our second fiscal quarter. We would cease to be a foreign private issuer at such time as more than 50% of our outstanding voting securities are held by United States residents and any of the following three circumstances applies: (1) the majority of our executive officers or directors are United States citizens or residents; (2) more than 50% of our assets are located in the United States; or (3) our business is administered principally in the United States. If we lose our “foreign private issuer status” we would be required to comply with Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirement for “foreign private issuers”.

9

PART I

ITEM 1 - IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2 - OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3 - KEY INFORMATION
A. [Reserved]
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors

An investment in our shares involves a high degree of risk and should be considered speculative. You should carefully consider the following risks set out below and other information before investing in our shares. If any event arising from these risks occurs, our business, prospects, financial condition, results of operations or cash flows could be adversely affected, the trading price of our shares could decline and all or part of any investment may be lost.

Our operations are highly speculative due to the high-risk nature of our business, which include the acquisition, financing, exploration, development of mineral infrastructure and operation of mines. The risks and uncertainties set out below are not the only ones we face. Additional risks and uncertainties not currently known to us or that we currently deem immaterial may also impair our operations. If any of the risks actually occur, our business, financial condition and operating results could be adversely affected. As a result, the trading price of our shares could decline and investors could lose part or all of their investment. Our business is subject to significant risks and past performance is no guarantee of future performance.

Our shares may not continue to be listed on the NYSE American LLC (“NYSE American”)

Failure to meet the applicable maintenance requirements of the NYSE American could result in our shares being delisted from the NYSE American. If we are delisted from the NYSE American, our shares may be eligible for trading on an over-the-counter market in the United States. In the event that we are not able to obtain a listing on another U.S. stock exchange or quotation service for our shares, it may be extremely difficult or impossible for shareholders to sell their shares in the United States. Moreover, if we are delisted from the NYSE American, but obtain a substitute listing for our shares in the United States, it may be on a market with less liquidity, and therefore potentially more price volatility, than the NYSE American. Shareholders may not be able to sell their shares on any such substitute U.S. market in the quantities, at the times, or at the prices that could potentially be available on a more liquid trading market. As a result of these factors, if our shares are delisted from the NYSE American, the price of our shares is likely to decline. In addition, a decline in the price of our shares will impair our ability to obtain financing in the future.

10

Future sales of our shares into the public market by holders of our options may lower the market price, which may result in losses to our shareholders.

As of April 26, 2024, we had 19,194,860 shares issued and outstanding. In addition, as of April 28, 2024, 20,000 shares were issuable upon exercise of outstanding stock options, all of which may be exercised in the future resulting in dilution to our shareholders. Awards under the incentive plan made to executives and certain other senior members of management on January 24, 2022, April 7, 2023 and April 8, 2024, consisting of a target of 113,693,80,7732 and 125,433 Equity-settled Performance Units (“EPUs”) respectively, are only to be settled in shares. The EPUs that vest will be subject to a performance multiplier and a maximum amount of 150% of target EPUs could vest. Accordingly, providing for such a maximum amount, Caledonia could grant options on a further 1,419,638 shares as at the date of this Annual Report on the assumption that all other outstanding awards (other than the options mentioned above) are settled in cash at the request of the holders. As of April 28, 2024, our senior officers and directors beneficially owned or had an interest in, as a group, 2,861,550 shares (14.91% of our issued share capital). Sales of substantial amounts of our shares into the public market, by our officers or directors or pursuant to the exercise of options, or even the perception by the market that such sales may occur, may lower the market price of our shares.

The price of gold is subject to volatility and may have a significant effect on our future activities and profitability.

The economic viability of our revenues, operations and exploration and development projects is, and is expected to be, heavily dependent on the price of gold, which is particularly subject to fluctuation and has fluctuated significantly in recent years. The price of gold is affected by numerous factors beyond our control including, but not limited to: international economic and political conditions; expectations of inflation; international currency exchange rates; interest rates; global or regional consumption patterns; speculative activities; levels of supply and demand; increased production due to new mine developments and improved mining and production methods; availability and costs of metal substitutes; and inventory carrying costs. The effect of these factors on the price of gold, and therefore the economic viability of our operations, cannot be accurately predicted. As required by Zimbabwean legislation, Blanket Mine (1983) (Private) Limited (“Blanket”), the company which owns the Blanket mine (“Blanket Mine”), Caledonia Holdings Zimbabwe (Private) Limited (“CHZ”), as agent, and Bilboes Holdings (Private) Limited (“Bilboes Holdings”) deliver their production to Fidelity Printers and Refiners Limited (“Fidelity”), which refines the gold to a purity of 99.5%. 75% of the gold delivered to Fidelity is refined on a toll-treatment basis. For the 75% portion Caledonia retains ownership of the gold that is then exported by Caledonia to a refiner of its choice outside Zimbabwe which undertakes further processing and sells the resulting gold on the international market.

75% of the portion of unrefined metals produced by Blanket and exported by Caledonia to Al Etihad Gold Refinery DMCC (“AEG”),from April of 2023 on the toll refinement basis, is transported by Ferrari Logistics Southern Africa (Proprietary) Limited to AEG in Dubai, UAE and further refined and sold by AEG at a cost of $7 per ounce. Gold transported throughout this process is fully insured. The sales to AEG are priced at the London Bullion Market Association (“LBMA”) post-delivery price less refining fee and the quantities are determined on the lodgment date. Settlement occurs within 2 days from AEG.

25% of Blanket's gold is sold to Fidelity at a price which reflects the prevailing LBMA price and the official Zimbabwe Gold (“ZiG”) or Zimbabwean real-time gross settlement, bond notes or bond coins (“RTGS$”)/USD exchange rate on the date of sale. Fidelity charges a 1.24% toll refining fee from the gross export proceeds. Fidelity collects a 5% royalty of which 50% is remitted to the Government of Zimbabwe in physical gold. The royalty is deducted from USD and RTG$ revenues proportionately. Settlement occurs within 14 days of delivery from Fidelity.

11

To hedge against negative gold prices, Caledonia hedges by way of purchasing out of the money put options. During 2023 and to the date of this Annual Report, the following hedges were purchased:

Purchase date | Ounces hedged | Strike price | Period of hedge
December 22, 2022 | 16,672 oz | $1,750 | December 2022 - May 2023
May 22, 2023 | 28,000 oz | $1,900 | June - December 2023
December 19, 2023 | 12,000 oz | $1,950 | January - March 2024
March 7, 2024 | 12,000 oz | $2,050 | April to June 2024
April 1, 2024 | 12,000oz | $2,100 | July – September 2024

Hedged ounces entered approximates the cash flow effect of Caledonia’s attributable share of the production.

Our Business Operations and/or Activities could be impacted by the spread of contagious diseases, such as the Coronavirus.

Our business could be significantly adversely affected by the effects of a widespread global outbreak of contagious diseases, including the recent outbreak of respiratory illness caused by a novel coronavirus (“COVID-19”). We cannot accurately predict the impact that contagious diseases, such as COVID-19, will have on third parties’, including our employees’ ability to fulfil their obligations to the Company, including due to uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries (including those countries we rely on to conduct our business operations), resulting in an economic downturn that could negatively impact our operating results.

Currently there are no concerns over the valuation of our assets as disclosed in the Consolidated Financial Statements and the Company does not foresee any changes in the cost of capital, cash requirements or any covenant defaults in our credit agreements. At the date of the authorisation of this document management is of the opinion that the effects of COVID-19 have been considered in making significant judgements and estimates, valuations and evaluating our going concern principle. However, it must be recognised that the duration and effects of pandemics are uncertain and can affect our forecasting accuracy. As of the date of this Annual Report, the severity of the effects of COVID-19 appear to be diminishing in the jurisdictions where the Company operates.

We cannot guarantee that there will not be an increase in input costs affecting our results of operations and financial performance.

Mining companies could experience higher costs of steel, reagents, labor, electricity, government levies, fees, royalties and other direct and indirect taxes. Our investment in a solar plant and efficiencies at existing operations should assist in curbing cost increases. However, there can be no assurance that we will be able to control such input costs and any increase in input costs above our expectations may have a negative result on our results of operations and financial performance.

Our operations may be subject to increased costs or even suspended or terminated as a result of any loss of required infrastructure in our operations.

Infrastructure, including water and electricity supplies, that is currently available and used by us may, as a result of adverse climatic conditions, natural disaster, incorrect or inadequate maintenance, sabotage or for other reasons, be destroyed or made unavailable or available in a reduced capacity. Were this to occur, operations at our properties may become more costly or have to be curtailed or even terminated, potentially having serious adverse consequences to our financial condition and viability that could, in turn, have a material adverse effect on our business, results of operations or financial performance.

12

Our operations may be subject to inadequate water supply.

Blanket uses water in the metallurgical process, some of which is pumped from the deeper levels of the mine but most of which is obtained from the “Blanket dam” (which, despite its name, is neither owned nor managed by Blanket Mine) which also supplies water to the nearby town of Gwanda. Blanket Mine is situated in a semi-arid region and rainfall typically only occurs in the period November to February. Management believes that there is enough water in the Blanket Mine dam to maintain normal operations until the next rainy season. During dry periods as a precautionary measure, Blanket intends to resuscitate existing boreholes and determine their yield; conduct hydrological surveys to identify potential new boreholes; recycle water from the lower levels of unused workings and construct a pond to store water that is pumped from current workings. If, however, there is inadequate water supply, operations at Blanket Mine may become more costly or have to be curtailed, suspended or even terminated which may have serious adverse consequences to the viability of gold production from Blanket Mine that could, in turn, have a material adverse effect on our business, results of operations or financial performance.

Our operations may be subject to inadequate electricity supply.

Zimbabwe’s electricity generation is mainly from the Kariba hydro station on the Zambezi river, the Hwange coal-fired station and several other much smaller coal-fired power stations. Even if Zimbabwe’s installed generating capacity is fully operational, it cannot generate enough electricity to meet its requirements and therefore Zimbabwe imports electricity from Mozambique and South Africa. Blanket Mine has a supply agreement with the Zimbabwe Electricity Supply Authority (“ZESA”) in terms of which it pays a premium rate in return for uninterrupted power.

The generating capacity at the Kariba hydro generating station fluctuates at times when the water levels are low. In addition, the export of electricity from South Africa to Zimbabwe is also interrupted due to a lack of generating capacity in South Africa and therefore interruptions to the Blanket supply do occur. The combined effect of these are severe electricity shortages that lead to “load-shedding” or low voltage occurrences.

Power surges as experienced at Blanket, if not controlled, can cause severe damage to Blanket’s electrical equipment. Blanket’s use of diesel for generating electricity decreased from approximately 3,827 kilo liters for the year in 2022 to 1,488 kilo liters in 2023.

Blanket has addressed the issue of interrupted power supply by installing stand-by generators. These generators can supply the whole mine with electricity but is a costly and environmentally unfriendly electricity source that is reliant on fuel imports that may from time to time be in shortage in Zimbabwe.

To mitigate against the current electricity situation, Caledonia has constructed a 12.2MWac solar plant at a cost of approximately $14.2 million (including construction costs and other project planning, structuring, funding and administration costs) supplying the Blanket operations. The solar plant was fully commissioned early February 2023 and provides approximately 24% of Blanket Mine’s average daily electricity demand. The plant has been providing power to Blanket from its initial connection to the Blanket grid in November 2022. The solar plant was classified as held for sale on September 28, 2023. Refer to note 24 of the Consolidated Financial Statements. The primary amount of electricity produced by the solar plant, after sale, will be sold to Blanket.

In April 2023 Blanket entered into a power supply agreement with the Intensive Energy Users Group (“IEUG”) and the Zimbabwean power utility to allow the IEUG to obtain power outside of Zimbabwe and strengthen the Zimbabwean power grid. As a result of this arrangement, Blanket has paid a lower tariff for IEUG supplied energy from April 2023, but it has not improved the power quality received at Blanket due to the continued difficulty with the Zimbabwe grid.

If an electricity shortage or outage persists, operations at the mines may become more costly or have to be curtailed, suspended or even terminated which may have serious adverse consequences to the viability of production from the mines that could, in turn, have a material adverse effect on our business, results of operations or financial performance.

13

We do business in countries and jurisdictions outside of the United States where different economic, cultural, regulatory, monetary and political environments could adversely impact our business, results of operations and financial condition.

The jurisdictions in which we operate are unpredictable. Assets and investments in these foreign jurisdictions are subject to risks that are usually associated with operating in a foreign country and any of these could result in a material adverse effect on our business, results of operations or financial performance. These risks include, but are not limited to, access to assets, labor disputes and unrest; arbitrary revocation of government orders, approvals, licenses and permits; corruption; uncertain political and economic environments; bribery; war; civil disturbances and terrorist actions; sudden and arbitrary changes to laws and regulations; delays in obtaining government permits; limitations on foreign ownership; more onerous foreign exchange controls; currency devaluations; import and export regulations; inadequate, damaged or poorly maintained infrastructure; and endemic illnesses. There can be no guarantee that governments in these jurisdictions will not unilaterally expropriate the property of companies that are involved in mining.

Caledonia’s mining operations are conducted in Zimbabwe and, as such, these operations are exposed to various levels of political, economic and other risks and uncertainties in addition to those set out above. These risks and uncertainties include, but are not limited to, expropriation and nationalization, or mandatory levels of Zimbabwean ownership beyond currently mandated levels; renegotiation, nullification or partisan terms of existing concessions, licenses, permits and contracts; illegal mining; changes in monetary and taxation policies; restrictions on foreign exchange and repatriation; and changing political conditions, currency controls and governmental regulations that favor or require the awarding of contracts to local contractors or require foreign contractors to employ citizens of, or purchase supplies from, a particular jurisdiction.

The current monetary situation in Zimbabwe can be summarized as follows:

| ● | Blanket produces ore gold that it is obliged to deliver to Fidelity, a subsidiary of the Reserve Bank of Zimbabwe (“RBZ”), which refines the gold to a purity of 99.5% on a toll-treatment basis. With effect from April 2023, 25% of the resultant gold is sold to Fidelity and the remaining 75% is exported by Caledonia to a refiner of its choice outside Zimbabwe which undertakes further processing and sells the resulting gold on the international market. During 2023 all gold exports were sent to AEG in Dubai. The sale proceeds for the gold exported and sold via the offshore refiner is paid to Blanket’s commercial bankers in Zimbabwe within 48 hours of delivery. Management believes this new sales mechanism reduces the risk associated with selling and receiving payment from a single refining source in Zimbabwe. It also creates the opportunity to use more competitive offshore refiners and it may allow for the Company to raise debt funding secured against offshore gold sales. 25% of Blanket's gold is sold to Fidelity at a price which reflects the prevailing LBMA price and the official RTGS$/USD exchange rate on the date of sale. Payment is made by Fidelity to Blanket in RTGS$ or ZiG from April 5, 2024 within 14 days of the sale. Fidelity charges a refining fee of 1.24% of the USD export proceeds; Fidelity collects half of the 5% royalty which is payable to the Government of Zimbabwe in physical gold which is deducted from the amount exported and the balance is paid in USD and RTGS$ or ZiG proportionately to the 75:25 revenue split between USD and RTGS$ or ZiG.
| ● | The interbank RTGS$ or ZiG/USD exchange rates at each quarter end and at the latest practicable date prior to the publication of this Annual Report are set out below.

| Interbank Exchange Rates | (RTGS$:US$1) | (ZiG:US$1) |
| February 20, 2019 | 2.50 |  |
| March 31, 2019 | 3.00 |  |
| June 30, 2019 | 6.54 |  |
| September 30, 2019 | 15.09 |  |
| December 31, 2019 | 16.77 |  |
| March 31, 2020 | 25.00 |  |
| June 30, 2020 | 57.36 |  |
| September 30, 2020 | 81.44 |  |
| December 31, 2020 | 81.79 |  |
| March 31, 2021 | 84.40 |  |
| June 30, 2021 | 85.42 |  |
| September 30, 2021 | 87.67 |  |
| December 31, 2021 | 108.66 |  |
| March 31, 2022 | 142.42 |  |
| June 30, 2022 | 370.96 |  |
| September 30, 2022 | 621.89 |  |
| December 31, 2022 | 684.33 |  |
| March 31, 2023 | 929.86 |  |
| June 30, 2023 | 5,739.80 |  |
| September 30, 2023 | 5,466.75 |  |
| December 31, 2023 | 6,104.72 |  |
| March 31, 2024 | 22,055.47 |  |
| April 8 , 2024 |  | 13.56 |
| May 10, 2024 |  | 13.52 |

14

| ● | Devaluation of the RTGS$ means that net monetary assets held in RTGS$ will devalue in USD terms. In the ordinary course of its business, Caledonia has net RTGS$-denominated assets comprising RTGS$-denominated cash and receivables (primarily for the 25% of gold sold to Fidelity and VAT receivables) and RTGS$ liabilities (mainly comprising taxes payable). During the first quarter of 2024, due to the increase in the rate of RTGS$ devaluation, management engaged more aggressively in RTGS$-denominated procurement to reduce its RTGS$-denominated cash. In the first quarter of 2024 to the date of this Annual Report, Blanket made prepayments of approximately $2 million in respect of consumables and supplies denominated in RTGS$.
| ● | RTGS$ cash balances at December 31, 2023 amounted to a USD equivalent of $539,115 and $360,541 at March 8, 2024.
| ● | On April 5, 2024 the Reserve Bank of Zimbabwe issued a Monetary Statement policy that introduced a structured currency (which is generally defined as a currency that is pegged to a specific exchange rate or currency basket and backed by a bundle of foreign exchange assets (including gold).). The structured currency called the ZiG replaced the RTGS$ from the said date. Banks were instructed to convert the RTGS$ balances into the new currency to foster simplicity, certainty, and predictability in monetary and financial affairs. The new currency will co-circulate with other foreign currencies in the economy. The retention threshold remained unchanged.

Investors should recognize that Caledonia’s ability to implement its investment and operational strategies, Caledonia’s ability to sustain its operations outside Zimbabwe and pay future dividends depends, inter alia, on the ability to continue to externalize cash from Zimbabwe and receive payments for the sale of its gold proceeds.

On June 27, 2023 the U.S. Department of State together with other U.S. government agencies issued an advisory in light of reports related to the role of illicit actors in the gold trade to (i) highlight the opportunities and specific risks raised by the gold trade across sub-Saharan Africa and (ii) encourage industry participants to adopt and apply strengthened due diligence practices to ensure that such malign actors are unable to exploit and benefit from the sector, which remains essential to the livelihoods of millions of people across sub-Saharan Africa. Caledonia acknowledges and concurs with the U.S. Department of State’s warning that without adequate due diligence and appropriate mitigating measures, an industry participant may inadvertently contribute to one or more of these risks, including conflict and terror financing, money laundering activities, sanctions evasion, human rights and labor rights abuses and environmental degradation. Caledonia has robust policies in place to counter such risks including, amongst other things: a Code of Business Conduct, Ethics and Anti-Bribery Policy, a Human Rights Policy and Customer AML/KYC Policy, and it encourages whistleblowing and grievance reporting in order to monitor compliance. Caledonia performs enhanced due diligence on significant suppliers and other counterparties (including, but not limited to, sanctions and political exposure checks), has established new and robust routes to market for its gold production (none of which, for the avoidance of doubt, is artisanal) and has scrutinized the new refineries to which it now sells its gold. The Company reports its environmental, social and governance (“ESG”) performance annually, disclosing key environmental data, supports artisanal miners in the form of tributing of gold claims (as well as the local community generally) and has adopted best practice in the construction of its new tailings storage facility (“TSF”) at Blanket. For more information in all of these areas, please refer to Caledonia’s ESG reports.

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Our operations are subject to various government approvals, permits, licenses and legal regulation for which no assurance can be provided that such approvals, permits or licenses will be obtained or if obtained will not be revoked or suspended.

Government approvals, permits and licenses are required in connection with a number of our activities and additional approvals, permits and licenses may be required in the future. The duration and success of our efforts to obtain approvals, permits and licenses are contingent upon many variables outside of our control. Obtaining governmental approvals, permits and licenses can increase costs and cause delays depending on the nature of the activity and the interpretation of applicable requirements implemented by the relevant authority. While we and our affiliates currently hold the necessary licenses to conduct operations there can be no assurance that all necessary approvals, permits and licenses will be maintained or obtained or that the costs involved will not exceed our estimates or that we will be able to maintain such permits or licenses. To the extent such approvals, permits and licenses are not obtained or maintained, we may be prohibited from proceeding with planned drilling, exploration, development or operation of properties which could have a material adverse effect on our business, results of operations and financial performance.

In addition, failure to comply with applicable laws, regulations and requirements in the countries in which we operate may result in enforcement action, including orders calling for the curtailment or termination of operations on our property, or calling for corrective or remedial measures requiring considerable capital investment. Although we believe that our activities are currently carried out in all material respects in accordance with applicable rules and regulations, no assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner that could limit or curtail production or development of our properties or otherwise have a material adverse effect on our business, results of operations and financial performance.

We face risks related to mining, exploration and mine construction on potential properties.

Our level of profitability, if any, in future years will depend on whether our mines produce at forecasted rates and whether any exploration and development stage properties can be brought into production. The mining, exploration and development of mineral deposits involves significant risks. It is impossible to ensure that any current and future exploration programs will establish mineral reserves or mineral resources. Whether a mineral ore body will be commercially viable depends on several factors, and the exact effect of these factors cannot be accurately predicted. The exploration, development and production activities are subject to political, economic and other risks, including:

| ● | cancellation or renegotiation of contracts;
| ● | changes in local and foreign laws and regulations;
| ● | changes in tax laws;
| ● | delays or refusal in granting prospecting permissions, mining authorizations and work permits for foreign management staff;
| ● | environmental controls and permitting;
| ● | expropriation or nationalization of property or assets;
| ● | foreign exchange controls and the availability of foreign exchange;
| ● | government mandated social expenditures;
| ● | import and export regulation, including restrictions on the sale of production in foreign currencies;
| ● | inflation of costs that is not compensated for by a currency devaluation;
| ● | requirement that a foreign subsidiary or operating unit has a domestic joint venture partner, which, possibly, the foreign company must subsidize;
| ● | restrictions on the ability of local operating companies to hold foreign currencies in offshore and/or local bank accounts;
| ● | restrictions on the ability of a foreign company to have management control of exploration and/or development and/or mining operations;

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| ● | restrictions on the remittance of dividend and interest payments offshore;
| ● | retroactive tax or royalty claims;
| ● | risks of loss due to civil strife, acts of war, guerrilla activities, insurrection and terrorism;
| ● | royalties and tax increases or claims by governmental entities;
| ● | unreliable local infrastructure and services such as power, water, communications and transport links;
| ● | demands or actions by native or indigenous groups;
| ● | other risks arising out of foreign sovereignty over the areas in which operations are conducted; and
| ● | lack of investment funding.

Such risks could potentially arise in any country in which we operate.

As a result of the foregoing, our exploration, development and production activities in Zimbabwe may be substantially affected by factors beyond our control, any of which could materially adversely affect our financial position or results from operations. Furthermore, in the event of a dispute arising from such activities, we may be subject to exclusive jurisdiction of courts outside North America or may not be successful in subjecting persons to the jurisdiction of the courts in North America, which could adversely affect the outcome of a dispute.

We will need to identify new mineral reserves to replace mineral reserves that have been depleted by mining activities and to commence new projects. No assurance can be given that exploration activities by us will be successful in identifying sufficient mineral reserves of an adequate grade and suitable metallurgical characteristics suitable for further development or production.

Refer to section 4.B – “Business Overview” for more information on our mining properties and projects.

Further development and commercial production at Blanket Mine, Bilboes and acquired exploration and evaluation assets cannot be assured.

We are engaged in further development activities at Blanket Mine, exploration and evaluation activities at Blanket’s satellite properties, the Bilboes gold project in Zimbabwe (“Bilboes” or the “Bilboes Project”) (oxides and sulphides) and the Maligreen project (“Maligreen”). Mining activities commenced at the Bilboes oxide mine in December 2022 and due to operating losses mining activities were placed on care and maintenance at the end of September 2023.

The estimates for future production, at Blanket Mine and the Bilboes Project, are based on mining plans and are subject to change. Production estimates are subject to risk and no assurance can be given that future production estimates will be achieved. Actual production may vary from estimated production for a variety of reasons including un-anticipated variations in grades, mined tonnages and geological conditions, accident and equipment breakdown, changes in metal prices and the cost and supply of inputs and changes to government regulations. Construction and development of projects are subject to numerous risks including, but not limited to: obtaining equipment, permits and services; changes in regulations; currency rate changes; labor shortages; fluctuations in metal prices; and the loss of community support.

Substantial expenditures are required to establish reserves through drilling, to develop metallurgical processes to extract gold from ore and to develop the mining, processing facilities and infrastructure at any site chosen for mining. Although substantial benefits may be derived from the discovery of a major mineralized deposit, no assurance can be given that minerals will be capable of economic extraction by metallurgical process, or discovered in sufficient quantities or grades, or the estimated operating costs of the mining venture are sufficient, to justify development of the deposit, or that the funds required for development can be obtained on a timely and economically acceptable basis.

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be predicted, such as metal price and market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. Depending on the price of minerals produced, the Company may determine that it is not commercially feasible to commence or continue commercial production.

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Refer to capital investments under Item 4.A – “History and Development of the Company”, for detail on development activities at Blanket and the Bilboes Project and exploration and evaluation assets.

We face credit risk exposure from counterparties to certain contractual obligations and there is no assurance that any such counterparty may not default in such obligation causing us to incur a financial loss.

Credit risk is the risk that a party with a contractual obligation with us will default causing a loss. New regulations introduced by the Zimbabwean Ministry of Finance in January 2014 required that all gold produced in Zimbabwe must be sold to Fidelity, a company which is controlled by the Zimbabwean authorities. Accordingly, all of our production from Blanket Mine and the Bilboes oxide mine was sold to Fidelity until April 26, 2023 when production began to be sold to both Fidelity and AEG (see above). This mechanism means that the Company is no longer fully exposed to credit risk from Fidelity in respect of the US dollar component of its sales. This arrangement introduces a credit risk, beyond our control, that receivables and contractual performance due from Fidelity will not be paid or performed in a timely manner, or at all. If Fidelity, the Zimbabwean government or AEG were unable or unwilling to conduct business with us, or satisfy obligations to us, we could experience a material adverse effect upon our operations and financial performance. All payments due from Fidelity or AEG at year end have been received in full and on time.

The mining industry is highly competitive and there is no guarantee we will always be able to compete effectively.

The mining industry is a highly diverse and competitive international business. The selection of geographic areas of interest are only limited by the degree of risk a company is willing to accept by the acquisition of properties in emerging or developed markets and/or prospecting in explored or virgin territory. Mining, by its nature, is a competitive business with the search for fresh ground with good exploration potential and the raising of the requisite capital to move projects forward to production. There is aggressive competition within the mining industry for the discovery and acquisition of properties considered to have commercial potential. We will compete with other interests, many of which have greater financial resources than we will have, for the opportunity to participate in promising projects. Such competition may have better access to potential resources, more developed infrastructure, more available capital, have better access to necessary financing, and more knowledgeable and available employees than us. We may encounter competition in acquiring mineral properties, hiring mining professionals, obtaining mining resources, such as manpower, drill rigs, and other mining equipment. Such competitors could outbid us for potential projects or produce gold at lower costs. Increased competition could also affect our ability to attract necessary capital funding or acquire suitable properties or prospects for gold exploration or production in the future. Significant capital investment is required to achieve commercial production from successful exploration and development efforts. Globally, the mining industry is prone to cyclical variations in the price of the commodities produced by it, as dictated by supply and demand factors, speculative factors and industry-controlled marketing cartels. Nature provides the ultimate uncertainty with geological and occasionally climatic surprises. Commensurate with the acceptance of this risk profile is the potential for high rewards. If we are unable to successfully compete for properties, capital, customers or employees it could have a materially adverse effect on our results of operations.

We were required to facilitate the economic participation of certain indigenous groups in our business and there can be no assurance that such required participation was at fair market value or that the terms of the agreements can be amended.

The government of Zimbabwe introduced legislation in 2012 requiring companies to facilitate participation in their shareholdings and business enterprises by the indigenous population (typically referred to as indigenization). It is not assured that such interests were paid for at full fair value. As reported, Blanket Mine complied with the requirements of the Indigenization and Economic Empowerment Act in Zimbabwe whereby indigenous shareholders legally owned 51% of Blanket Mine since September 2012 (until 2020 – see below).

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Pronouncements from the Zimbabwe Government following the appointment of the new President in late 2017 announced a relaxation in the indigenization policy which, amongst other things, included the removal of an indigenization requirement for gold mining companies. These pronouncements were passed into law in March 2018.

We currently do not depend on our ability to successfully access the capital and financial markets. However, should our financial position change any inability to access the capital or financial markets may limit our ability to execute our business plan or pursue investments that we may rely on for future growth.

Depending on our ability to generate income from our operations, we may require further financing for current and future exploration and development. Should our projections for fiscal years 2024 through to 2026 prove incorrect, to finance our working capital needs, we may have to raise funds through the issuance of additional equity or debt securities. Depending on the type and the terms of any financing we pursue, shareholders’ rights and the value of their investment in our shares could be reduced. Any additional equity financing will dilute shareholdings, and new or additional debt financing, if available, may involve restrictions on financing and operating activities. In addition, if we issue secured debt securities, the holders of the debt would have a claim to our assets that would be prior to the rights of shareholders until the debt is paid. Interest on these debt securities would increase costs and negatively impact operating results.

If we are unable to obtain additional financing, as needed, at competitive rates, our ability to implement our business plan and strategy may be affected, and we may be required to reduce the scope of our operations and scale back our exploration and development programs as the case may be. There is, however, no guarantee that we will be able to secure any additional funding or be able to secure funding which will provide us with sufficient funds to meet our objectives, which may adversely affect our business and financial position.

Our share price has been and is likely to continue to be volatile and an investment in our shares could suffer a decline in value.

Market prices for mining company securities, by their nature, are volatile. Factors, such as rapidly changing commodity prices, political unrest globally and in countries where we operate, speculative interest in mining stocks etc. are but a few factors affecting the volatility of the share price. Our shares are listed in the U.S. on the NYSE American, depositary interests representing our shares are admitted to trading on AIM of the London Stock Exchange (“AIM”), and depositary receipts representing our shares were listed on the VFEX in December 2021 raising gross proceeds of approximately $7.8m (the use of the term “share” in this Annual Report also, where the context requires, extends to a depositary interest or depositary receipt representing a share). The Company voluntarily delisted its shares from the Toronto Stock Exchange (“TSX”) on June 19, 2020. After the delisting the Company remains a Canadian reporting issuer and has to comply with Canadian securities laws unless and until it can demonstrate that less than 2% of its beneficial shareholders are Canadian residents. During 2023 gross proceeds of $10.8m and $5.9m were raised by issuing depository interests on AIM and depository receipts on the VFEX respectively.

The market price of our shares may be highly volatile and subject to wide fluctuations. In addition, the trading volume of our shares may fluctuate and cause significant price variations to occur. If the market price of our shares declines significantly, you may be unable to resell your shares at or above the purchase price, if at all. We cannot assure you that the market price of our shares will not fluctuate or significantly decline in the future.

Factors affecting our share price include but are not limited to:

| ● | actual or expected fluctuations in our operating results;
| ● | actual or expected changes in our growth rates or our competitors’ growth rates;
| ● | changes in the market price of gold;
| ● | changes in the demand for gold;
| ● | high extraction costs;
| ● | accidents;
| ● | changes in market valuations of similar companies;

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| ● | additions to or departures of our key personnel;
| ● | actual or anticipated fluctuations in our quarterly operating results or those of our competitors;
| ● | publication of research reports by securities analysts about us or our competitors in the industry;
| ● | our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market;
| ● | fluctuations of exchange rates between the US$, GBP, CAD, RTGS$, ZiG and ZAR;
| ● | changes or proposed changes in laws and regulations affecting the gold mining industry;
| ● | changes in trading volume of our shares on the NYSE American, AIM or VFEX;
| ● | sales or perceived potential sales of our shares by us, our directors, senior management or our shareholders in the future;
| ● | short selling or other market manipulation activities;
| ● | announcement or expectation of additional financing efforts;
| ● | terrorist acts, acts of war or periods of widespread civil unrest;
| ● | natural disasters and other calamities;
| ● | litigation involving us, including: shareholder litigation, investigations or audits by regulators into our operations; or proceedings initiated by our competitors or clients;
| ● | strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy;
| ● | the passage of legislation or other regulatory developments affecting us or our industry;
| ● | fluctuations in the valuation of companies perceived by investors to be comparable to us; and
| ● | conditions in the U.S., United Kingdom and Zimbabwe financial markets or changes in general economic conditions.

The Company conducted equity raises by way of placings in the first two quarters of 2023 which targeted institutional investors in the UK, Europe, South Africa and Zimbabwe. The equity raises were over-subscribed: depositary interests in respect of 781,749 shares were issued to institutional investors in the UK, Europe and South Africa on March 30, 2023 and Zimbabwe depositary receipts in respect of 425,765 shares were issued to investors in Zimbabwe on April 14, 2023. The placing price was $13.74 and the placings raised $16.6 million before expenses. Mark Learmonth, Chief Executive Officer, and Toziyana Resources Limited, a company affiliated with Victor Gapare, an executive Director of the Company, subscribed for 3,587 shares and 11,000 shares respectively in the equity raise before the start of the Quarter. The proceeds of the equity raises were or are expected to be used for the Bilboes pre-feasibility study (refer to Exhibit 15.6), a shared services centre in Zimbabwe, the establishment of an international procurement arm to supply future operations, and exploration drilling at Motapa.

We are dependent on key management employees.

Our success depends (i) on the continued contributions of our directors, executive officers, management and consultants; and (ii) on our ability to attract new personnel whenever we seek to implement our business strategy. The loss of the services of any of these persons could have a materially adverse effect on our business, prospects, results of operations and financial performance. The limited availability of mining and other technical skills and experience in Zimbabwe and the difficulty of attracting appropriately skilled employees to Zimbabwe creates a risk that appropriate skills may not be available if, for whatever reason, the current skills base at the mines are depleted. There is no assurance that we will always be able to locate and hire all the personnel that we may require. Where appropriate, we engage with consulting and service companies to undertake some of the work functions. The Caledonia and Blanket management teams have been augmented so that it could provide appropriate support to Blanket if this is required.

Our mineral rights may be subject to defects in title.

We are not currently aware of any significant competing ownership claims or encumbrances respecting title to our properties. However, the ownership and validity or title of unpatented mining claims and concessions are often uncertain and may be contested. We also may not have, or may not be able to obtain, all necessary surface rights to develop a property. Although we have taken reasonable measures to ensure proper title to our properties, there is no guarantee of title to our properties or that competing ownership claims or encumbrances respecting our properties will not be made in the future. Title insurance is generally not available for mineral properties and our ability to ensure that we have obtained secure claims to individual mineral properties or mining concessions may be severely constrained. Our mineral properties may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. We may incur significant costs related to defending the title to our properties. A successful claim contesting our title to a property may cause us to compensate other persons or perhaps reduce our interest in the affected property or lose our rights to explore and, if warranted, develop that property. This could result in us not being compensated for our prior expenditures relating to the property. Also, in any such case, the investigation and resolution of title issues would divert our management’s time from ongoing exploration and, if warranted, development programs. Any impairment or defect in title could have a negative impact on us.

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We are subject to operational hazards and risks that could have a material adverse effect on our business, results of operations and financial performance.

We are subject to risks typical in the mining business. These include, but are not limited to, operational issues such as unexpected geological conditions or earthquakes causing unanticipated increases in the costs of extraction or leading to falls of ground and rock bursts, particularly as mining moves into deeper levels. Major cave-ins, flooding or fires could also occur under extreme conditions. Although equipment is monitored and maintained and all staff receive safety training, accidents caused by equipment failure or human error could occur. Such occurrences could result in damage to, or destruction of, mineral properties or production facilities, personal injury or death, environmental damage, delays in mining, monetary losses and possible legal liability. As a result, we may incur significant liabilities and costs that could have a material adverse effect upon our business, results of operations and financial performance.

Lawsuits may be filed against us and an adverse ruling in any such lawsuit could have a material adverse effect on our business, results of operations and financial performance.

We may become party to legal claims arising in the ordinary course of business. There can be no assurance that unforeseen circumstances resulting in legal claims will not result in significant costs or losses. The outcome of outstanding, pending or future proceedings cannot be predicted with certainty and may be determined adversely to us and as a result, could have a material adverse effect on our assets, liabilities, business, financial condition and results of operations. Even if we prevail in any such legal proceedings, the proceedings could be costly and time-consuming and may divert the attention of management and key personnel from our business operations, which could adversely affect our financial condition. In the event of a dispute arising in respect of our foreign operations, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of courts in the United States of America, South Africa, Zimbabwe, Canada, the United Kingdom, Jersey Channel Islands or international arbitration. The legal and political environments in which we operate may make it more likely that laws will not be enforced and that judgments will not be upheld. If we are unsuccessful in enforcing our rights under the agreements to which we are party to or judgments that have been granted, or if laws are not appropriately enforced, it could have a material adverse effect on our business, results of operations and financial performance.

We face risks related to illegal mining and no assurance can be provided that such illegal mining will not have an adverse effect on our business, results of operations and financial performance.

Illegal mining activities on properties controlled by the business have been identified. This gives rise to increased security costs and an increased risk of theft and damage to equipment. The business has received adequate support and assistance from the Zimbabwean police in investigating such cases but there can be no guarantee that the support from the Zimbabwean police will continue and whether their support will stop illegal mining activities.

Most of our employees are members of the Associated Mine Workers Union of Zimbabwe and any work stoppage or industrial action implemented by the union may affect our business, results of operations and financial performance.

Most of the employees are members of either the Associated Mine Workers Union of Zimbabwe or Zimbabwe Diamond and Allied Minerals Workers Union. Pay rates for all wage-earning staff are negotiated on a Zimbabwe industry-wide basis between the union and representatives of the mine owners. Any industrial action called by the union may affect our operations even though our operations may not be at the root cause of the action. Strikes, lockouts or other work stoppages could have a material adverse effect on our business, results of operations and financial performance. In addition, any work stoppage or labor disruption at key customers or service providers could impede our ability to supply products, to receive critical equipment and supplies for our operations or to collect payment from customers encountering labor disruptions. Work stoppages or other labor disruptions could increase our costs or impede our ability to operate.

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There can be no assurance that changes to any environmental, health and safety laws to which we are currently subject would not adversely affect our exploration and development programs.

Our exploration, development and operations are subject to environment, health and safety (“EH&S”) laws and regulations in the countries in which the relevant activity is being conducted.

In 2018, a training facility (called the Nyanzvi initiative) was established at Blanket using dedicated facilities and specially trained facilitators. The entire Blanket workforce participated in the program which resulted in the general improvement in safety in the first two quarters of 2020. The Nyanzvi program was suspended from late March 2020 due to the need to observe social distancing because of COVID-19 which contributed to the increase in reportable events. The Nyanzvi initiative was resumed in the last quarter of 2021 as COVID-19 restrictions were relaxed; management believes this will help to increase general safety awareness.

During 2023 102 employees trained on Nyanzvi 2. Co-creation training of the engineering leadership, which comprise 17 section engineers, manager, foremen and charge hands. An engineering pilot team of 11 employees was trained. Team rankings for the best performers for all departments continued in the fourth quarter of 2024.

Safety training is an ongoing exercise and it will remain an area of focus for the Company. There is no assurance, however, that future changes in EH&S, if any, will not adversely affect our exploration and development programs or our operations. There are no assurances that regulatory and environmental approvals required under EH&S will be obtained on a timely basis or if at all. A breach of EH&S may result in the temporary suspension of operations, the imposition of fines, other penalties (including administrative penalties and regulatory prosecution), and government orders, which could potentially have a material adverse effect on operations.

Due to the nature of our business, our operations face extensive EH&S risks.

Gold mining is exposed to numerous risks and events, the occurrence of which may result in the death of, or personal injury to, employees. EH&S legislation applicable to us could suspend part or all of our operations. EH&S incidents could therefore lead to increased unit production costs or lower production which could negatively affect our business, operating and/or financial results.

Regrettably, a fatality occurred on February 16, 2023. The fatality occurred as a result of a secondary blasting accident. The directors and management of Caledonia and Blanket express their sincere condolences to the family and colleagues of the deceased. Management has provided the necessary assistance to the Ministry of Mines Inspectorate Department in its enquiries into the incident. Caledonia takes the safety of its employees very seriously and, accordingly, measures have been taken to reinforce adherence to prescribed safety procedures.

In August, 2023 Caledonia reported that an employee of a company contracted to Blanket died of injuries sustained in an accident at Blanket.

We are exposed to the risk of onerous environmental legislation which could potentially result in significant cost and liabilities

The environment, including water streams, land, habitat and environments near the mining sites can be impacted by our mining and other operational activities. With an increasing global focus and public sensitivity to environmental sustainability and environmental regulation becoming more stringent, we could be subject to further environmental related responsibilities and associated liability. Environmental legislation and permitting requirements are likely to evolve in a manner which will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects, an increase in capital expenditure and a heightened degree of responsibility for companies and their directors and employees.

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Closure of mining operations, without sufficient financial provision for the funding of rehabilitation liabilities may result in our directors becoming subject to prosecution, litigation and potentially significant liabilities.

Future expenditure on rehabilitation might not be complete or accurately provided for due to higher than expected cost increases, changes in legislation, unidentified factors or other factors out of our control. Annual in-house reviews and rehabilitation costs and footprint estimation are done to control this risk. Every third year external experts review our footprint and cost estimations. At December 31, 2023 our total consolidated rehabilitation provision amounted to $11.0m as stated in note 29 of the Consolidated Financial Statements.

We may enter into acquisitions or other material transactions at any time.

We continually seek to replace and expand our reserves through the exploration of our existing properties and may expand through acquisitions of interests in new properties or interests in properties such as the Bilboes Project, Maligreen and Motapa. Acquisitions involve a number of risks, including: the possibility that we, as a successor owner, may be legally and financially responsible for liabilities of prior owners; the possibility that we may pay more than the acquired company or assets are worth; the additional expenses associated with completing an acquisition and amortizing any acquired intangible assets; the difficulty of integrating the operations and personnel of an acquired business; the challenge of implementing uniform standards, controls, procedures and policies throughout an acquired business; the inability to integrate, train, retain and motivate key personnel of an acquired business; and the potential disruption of our ongoing business and the distraction of management from its day-to-day operations. These risks and difficulties, if they materialize, could disrupt our ongoing business, distract management, result in the loss of key personnel, increase expenses and may have a material adverse effect on our business, results of operations and financial performance.

As a foreign private issuer, we are permitted to file less information with the SEC than a company that is not a foreign private issuer or that files as a domestic issuer.

As a foreign private issuer, we are exempt from certain rules under the Exchange Act that impose disclosure requirements as well as procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our officers, directors and principal shareholders are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as a company that files as a domestic issuer whose securities are registered under the Exchange Act, nor are we generally required to comply with the SEC’s Regulation FD, which restricts the selective disclosure of material non-public information. For as long as we are a “foreign private issuer” we intend to file our annual financial statements on Form 20-F and furnish our quarterly financial statements on Form 6-K to the SEC for so long as we are subject to the reporting requirements of Section 13(g) or 15(d) of the Exchange Act. However, the information we file or furnish is not the same as the information that is required in annual and quarterly reports on Form 10-K or Form 10-Q for U.S. domestic issuers. Accordingly, there may be less information publicly available concerning us than there is for a company that files as a domestic issuer.

We may lose our foreign private issuer status, which would then require us to comply with the Exchange Act’s domestic reporting regime and cause us to incur additional legal, accounting and other expenses.

We are required to determine our status as a foreign private issuer on an annual basis at the end of our second fiscal quarter. In order to maintain our current status as a foreign private issuer, either (1) a majority of our shares must be either directly or indirectly owned of record by non-residents of the United States or (2) (a) a majority of our executive officers or directors must not be U.S. citizens or residents, (b) more than 50 percent of our assets cannot be located in the United States and (c) our business must be administered principally outside the United States. If we lost this status, we would be required to comply with the Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. We would also be subject to additional restrictions on offers and sales of securities outside the United States and would have to comply with the generally more restrictive Regulation S requirements under the Securities Act that apply to U.S. domestic issuers, which could limit our ability to access capital markets in the future. The regulatory and compliance costs to us under U.S. securities laws if we are required to comply with the reporting requirements applicable to a U.S. domestic issuer may be higher than the cost we would incur as a foreign private issuer. As a result, we expect that a loss of foreign private issuer status would increase our legal and financial compliance costs.

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We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies may make our shares less attractive to investors and, as a result, adversely affect the price of our shares and result in a less active trading market for our shares.

We are an “emerging growth company” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that apply to other public companies that are not emerging growth companies. For example, we have qualified for an exemption from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act relating to internal control over financial reporting, and we will not require such an attestation from our auditors.

We may avail ourselves of these disclosure exemptions until we are no longer an emerging growth company. We cannot predict whether investors will find our shares less attractive because of our reliance on some or all these exemptions. If investors find our shares less attractive, it may adversely impact the price of our shares and there may be a less active trading market for our shares.

We will cease to be an emerging growth company upon the earliest of:

● | the last day of the fiscal year during which we have total annual gross revenues of $1,235,000,000 (as such amount is indexed for inflation every five years by the SEC or more);
● | the last day of our fiscal year following the fifth anniversary of the completion of our first sale of equity securities pursuant to an effective registration statement under the Securities Act;
● | the date on which we have, during the previous three-year period, issued more than $1,000,000,000 in non- convertible debt; or
● | the date on which we are deemed to be a “large accelerated filer”, as defined in Rule 12b–2 of the Exchange Act, which would occur if the market value of our shares that are held by non-affiliates exceeds $700,000,000 as of the last day of our most recently-completed second fiscal quarter.

During 2020, the Company sold its first equity securities under the Securities Act. This means that the Company may no longer qualify as an emerging growth company following the fifth anniversary of the completion of the equity raise. The Company may instead thereafter have to comply with Section 404(b) of the Sarbanes-Oxley Act where our registered public accountant will be required to attest to management’s assessment of its internal controls over financial reporting as presented under Item 15B of Form 20-F.

If we fail to establish and maintain proper internal controls, our ability to produce accurate financial statements or comply with applicable regulations could be impaired.

Section 404(a) of the Sarbanes-Oxley Act requires that our management assess and report annually on the effectiveness of our internal controls over financial reporting and identify any material weaknesses in our internal controls over financial reporting. Although Section 404(b) of the Sarbanes-Oxley Act requires our independent registered public accounting firm to issue an annual report that addresses the effectiveness of our internal controls over financial reporting, we have opted to rely on the exemptions provided to us by virtue of being a foreign private issuer and an emerging growth company, and consequently will not be required to comply with SEC rules that implement Section 404(b) of the Sarbanes-Oxley Act until we lose our emerging growth company status.

If either we are unable to conclude that we have effective internal controls over financial reporting or, at the appropriate time, our independent auditors are unwilling or unable to provide us with an unqualified report on the effectiveness of our internal controls over financial reporting as required by Section 404(b) of the Sarbanes-Oxley Act, investors may lose confidence in our operating results, the price of our shares could decline and we may be subject to litigation or regulatory enforcement actions.

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The Company’s management, including the Chief Executive Officer and the Chief Financial Officer, are responsible for implementing measures to make sure all internal controls are in place and will comply with the requirements of Section 404(b) of the Sarbanes-Oxley Act when it becomes effective from the 2026 financial reporting period.

There is uncertainty with our mineral reserve and mineral resource estimates.

Our mineral reserve and mineral resource estimates described in this document are estimated in accordance with the requirements of Subpart 1300 of Regulation S-K (“Subpart 1300”). We believe these estimates also comply with Canada’s National Instrument 43-101 (“NI 43-101”). These estimates may not reflect actual mineral reserves and, mineral resources, or future production. Should we encounter mineralization or formations different from those predicted by past drilling, sampling and similar examinations, mineral reserve and mineral resource estimates may have to be adjusted and mining plans may have to be altered in a way that might ultimately cause our mineral reserve and mineral resource estimates to decline. Our mineral resource estimates may never be upgraded to mineral reserves. Moreover, if the gold price declines, or if our labor, consumable, electricity and other production costs increase or recovery rates decrease, it may become uneconomical to recover our mineral reserves. Under these circumstances, we would be required to re-evaluate our mineral reserves and mineral resources. Mineral reserve and mineral resource estimates are based on drilling results and because unforeseen conditions may occur, the actual results may vary from the initial estimates. These factors could result in reductions in our mineral reserve and mineral resource estimates, which could in turn adversely impact the total value of our business.

U.S. investors may not be able to enforce their civil liabilities against us or our directors and officers.

It may be difficult to bring and enforce suits against us, because we were amalgamated and exist under the laws of Jersey, Channel Islands and are situated in Jersey, Channel Islands and do not have assets located in the United States.

All our assets are located outside the United States and most of our directors and all of our officers are residents of countries other than the United States. As a result, it may be difficult for investors to effect service of process on us or these non-United States resident persons within the United States or to rely in the United States upon judgments obtained in the United States based on the civil liability provisions of the U.S. federal securities laws against us or our officers and non-United States resident directors. In addition, our U.S. shareholders should not assume that the courts of Jersey, Channel Islands (i) would enforce judgments of U.S. courts obtained in actions against us, our officers or directors predicated upon the civil liability provisions of the U.S. federal securities laws or other laws of the United States, or (ii) would enforce, in original actions, liabilities against us, our officers or directors predicated upon the U.S. federal securities laws or other laws of the United States.

We are incorporated under the laws of Jersey, Channel Islands and our principal offices are located outside of the United States which could have negative tax consequences for U.S. investors.

We are incorporated under the laws of Jersey, Channel Islands and are located outside of the United States. Accordingly, U.S. investors could be subject to negative tax consequences. If we choose to make an offering of securities in the United States, the applicable prospectus is expected to include a discussion of the material United States tax consequences relating to the purchase, ownership and disposition of any securities offered thereby, to the extent not set out in this Annual Report; however, investors should consult their own tax advisors as to the consequences of investing in Caledonia.

There is uncertainty as a result of the conflict in Ukraine and Israel-Gaza

The conflict in Ukraine which began in February 2022, and the accompanying international response including economic sanctions, has been extremely disruptive to the world economy, with increased volatility in commodity markets, including higher oil and gasoline prices, international trade and financial markets, all of which have a trickle-down effect on supply chains, equipment and construction. There is substantial uncertainty about the extent to which this conflict will continue to impact economic and financial affairs, as the numerous issues arising from the conflict are in flux and there is the potential for escalation of the conflict both within Europe and globally. There is a risk of substantial market and financial turmoil arising from the conflict which could have a material adverse effect on the economics of the Company’s projects, and the Company’s ability to operate its business and advance project development.

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Even though we do not have any operations or direct suppliers located in Israel, tensions in the Middle East centred around the Israel-Gaza conflict could result in disruptions to our business and operations, adversely affect our anticipated unit and production costs, increase raw material costs, increase inflationary pressures, impacting our ability to successfully contract with suppliers, and could have other adverse impacts on our anticipated costs. We have not experienced any direct impacts from the conflicts thus far.

We rely on the use of technology and information systems, which may become subject to cyber-terrorism or other compromises and shut-downs, and any failures or interruptions of these systems could adversely affect our businesses operations.

We operate businesses that are dependent on information systems and other technology, such as computer systems used for information storage, processing and administrative functions. We rely heavily on our financial, accounting, communications and other data processing systems.

Our systems could be breached or damaged by computer viruses and systems attacks, natural or man-made incidents, disasters or unauthorized physical or electronic access, despite the measures that we have in place, including those related to cyber security. Cyber incidents may remain undetected for an extended period, which could exacerbate these consequences.

System failures, security breaches or accidents could give rise to potential theft, loss, business disruption, corruption, exposure or other damage to proprietary business data or employee or other personal data. The result can be significant remediation and other costs, fines, litigation and regulatory actions against us by various regulatory organizations or exchanges, governments or affected individuals due to non-compliance with our contractual or other legal obligations regarding data or intellectual property or violating our privacy and security policies. Significant reputational harm and/or financial loss can occur. We cannot predict what effects these attacks, compromises or shut-downs would have, and the consequences could be material.

A prolonged global failure of cloud services provided by a variety of cloud services providers that we engage could result in cascading systems failures for us, and we can provide no assurance that our efforts or those of third parties with whom we conduct business will be successful in protecting our systems and preventing or limiting damages from a cyber incident.

Caledonia continues to develop precautionary measures to ensure the integrity of our system and that we remain subject to additional known or unknown threats. Occasionally we implement updates to our information technology systems and software. In addition, our employees also receive regular training on cyber- and/ or other information technology threats.

Theft or hijacking of gold may arise on site or during deliveries

Theft of gold can impact on our profitability and increase costs, e.g. insurance, security, etc. Security measures are put in place to prevent theft of gold on site and during deliveries. Insurance is also taken out for gold on site and during deliveries. Management is continuously being made aware of any incidents and precautionary measures are reviewed on a regular basis. Caledonia has changed the delivery of gold to helicoptering instead of by road to decrease the risk of theft during deliveries. Extra security was also added at the metallurgical plant.

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ITEM 4 - INFORMATION ON THE COMPANY

A. History and Development of the Company

Caledonia Mining Corporation Plc (previously Caledonia Mining Corporation) was incorporated, effective February 5, 1992, by the amalgamation of three predecessor companies and was registered at the time under the Canada Business Corporations Act.

Following the creation of Caledonia its shares were listed on the TSX and quoted on the NASDAQ small caps market. On October 16, 1998, Caledonia announced that NASDAQ would no longer quote its securities for trading. Caledonia’s stock commenced trading on the OTCQX in June 2005.

Effective April 1, 2006 the Company purchased 100% of the issued shares of the Zimbabwean company, CHZ, that held 100% of the shares of Blanket Mine. The purchase consideration was $1,000,000 and 20,000,000 shares of Caledonia. The Company acquired all the assets and assumed all the liabilities of CHZ.

The Company re-domiciled from Canada to Jersey using a legal process called “Continuance” on March 19, 2016. The Company operates under the Companies (Jersey) Law 1991, as amended, (the “Companies Law”). The Continuance had no effect on the Company’s listing on the TSX or on the trading facilities on AIM in London or on the OTCQX in the United States of America.

On July 24, 2017, the Company announced that its shares would be listed on the NYSE American and trading began on July 27, 2017. The trading of the Company’s shares on the OTCQX ceased upon the commencement of trading on the NYSE American.

Caledonia voluntary delisted its shares from the TSX on June 19, 2020. After the delisting, the Company remains a Canadian reporting issuer and has to comply with Canadian securities laws unless and until it can demonstrate that less than 2% of its beneficial shareholders are Canadian residents. On December 2, 2021, Caledonia issued and listed 619,783 depositary receipts representing an equivalent number of shares on the VFEX raising gross proceeds of $7.8 million.

On January 6, 2023, Caledonia completed the acquisition of Bilboes Gold Limited (“Bilboes Gold”), further details of which can be found in Section 4.B “Business overview” of this report.

During the first two quarters of 2023 gross proceeds of $10.8 million were raised by issuing 781,749 depository interests which were subsequently listed on AIM and gross proceeds of $5.9 million were raised by issuing 425,765 depository receipts which were subsequently listed on the VFEX.

As at the date of this report Caledonia’s securities trade on the NYSE American, AIM and VFEX under the ticker “CMCL”.

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The addresses and telephone numbers of Caledonia’s principal offices are:

Registered and Head Office | African Office - South African Subsidiaries

Caledonia Mining Corporation Plc | Caledonia Mining South Africa Proprietary Limited
B006 Millais House, Castle Quay, St Helier | 4th Floor, 1 Quadrum office park
Jersey, Channel Islands | Johannesburg, Gauteng, 2198
JE2 3EF | South Africa
(44) 1534 679 800 | (27) 11 447 2499

Indigenization of Blanket Mine

On February 20, 2012 certain companies within Caledonia’s group of companies (the “Group”) announced that they had signed a Memorandum of Understanding (“MoU”) with the Minister of Youth, Development, Indigenization and Empowerment of the Government of Zimbabwe pursuant to which the Group agreed that indigenous Zimbabweans would acquire an effective 51% ownership interest in the Blanket Mine for a transactional value of $30.09 million. Pursuant to the above, the Group entered into agreements with each indigenous shareholder to transfer 51% of the Group’s ownership interest in Blanket Mine whereby it:

● | sold a 16% interest to the National Indigenization and Economic Empowerment Fund (“NIEEF”) for $11.74 million;
● | sold a 15% interest to Fremiro Investments (Private) Limited (“Fremiro”), which is owned by indigenous Zimbabweans, for $11.01 million;
● | sold a 10% interest to Blanket Employee Trust Services (Private) Limited (“BETS”) for the benefit of present and future managers and employees for $7.34 million. The shares in BETS are held by the Blanket Mine Employee Trust (“Employee Trust”) with Blanket Mine’s employees holding participation units in the Employee Trust; and
● | donated a 10% ownership interest to the Gwanda Community Share Ownership Trust (“Community Trust”). In addition, Blanket Mine paid a non-refundable donation of $1 million to the Community Trust.

In anticipation of completing the underlying subscription agreements, advances were made to NIEEF and the Community Trust against their rights to receive dividends declared by Blanket Mine on their shareholdings as follows:

● | a $2 million payment to the Community Trust on or before September 30, 2012;
● | a $1 million payment to the Community Trust on or before February 28, 2013; and
● | a $1 million payment to the Community Trust on or before April 30, 2013.

Advances made to NIEEF as an advanced dividend loan were settled through dividend repayments in 2014. The final payment to settle the advance dividend loan to the Community Trust was made on September 22, 2021. Future dividends to the Community Trust are unencumbered from the date the loan was settled in full.

The Group facilitated the vendor funding of these transactions and the advanced dividend loans which were repaid by way of dividends from Blanket Mine. 100% of dividends declared by Blanket Mine as payable to the Community Trust were used to repay its advanced dividend loan until the beginning of 2020 when Blanket agreed that 80% of dividends declared by Blanket Mine would be used to repay such loan and the remaining 20% would unconditionally accrue to the Community Trust, which was the same arrangement that applied to the other indigenous shareholders (see below). The timing of the repayment of the loans depends on the future financial performance of Blanket Mine and the extent of future dividends declared by Blanket Mine. Subsequent to the indigenization transactions the facilitation loans relating to the Group were transferred as a dividend in specie to the Company.

Pronouncements from the Zimbabwe Government following the appointment of the new President in late 2017 declared a relaxation in the indigenization policy which, amongst other things, included the removal of an indigenization requirement for gold mining companies. These pronouncements were passed into law in March 2018. In light of the changed legislation, on November 6, 2018, the Company announced that it had entered into a sale agreement with Fremiro to purchase Femiro’s 15% shareholding in Blanket for a gross consideration of $16.667 million to be settled through a combination of the cancellation of the loan between the two entities (which stood at $11.467 million as at June 30, 2018) and the issue of 727,266 new shares in Caledonia at an issue price of $7.15 per share. On completion of the transaction on January 20, 2020, Caledonia owned 64% in Blanket and Fremiro held approximately 6.3% of Caledonia’s shares.

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On February 27, 2020, the Company, Blanket Mine and the indigenous shareholders of Blanket Mine reached an agreement to change the repayment terms of the advance dividend loan to the Community Trust. The amendment allowed that 20% of the Community Trust’s share of the Blanket dividend would accrue to it on declaration of the dividend and that the remaining 80% be applied to the advance dividend loan from February 27, 2020. The modification was not considered beneficial to the other indigenous shareholders.

Blanket Mine - Capital Investment

The main capital development project is the infrastructure which will allow for three new production levels (26, 30 and 34 levels); a fourth level (38 level) is to be added in due course via a twin decline that commenced construction in February 2024.

Work on the key development areas in 2023 are detailed below:

● | 30 and 34 level development: the 30 level and 34 level northern and southern haulages had a total advance of 384.3m. Part of the northern haulage development included the take off to the 30 level Eroica extraction haulage, developed for 34.6m which development had to be reviewed pending evaluation work in the area. Development north on 30 level subsequently included additional evaluation cubbies.
● | Eroica decline 3: the Eroica decline had a total of 108m developed. The expected completion was deferred to the start of the first quarter of 2024 due to the slow rate of development owing to logistical challenges. 900m will be the last level in the development of the decline and there will be up dip development from 990m to 900m.
● | 930m 2 Orebody Hanging Wall Haulage: the total advance for the haulage was 159.9m. The haulage serves to expose the Blanket southern orebodies on 930m for production. The haulage is also important for the establishment of an access crosscut to link 6 Shaft on 930m.34 – 38 level twin declines: the twin declines had slow progress during the fourth quarter of 2023 with a total of 190.5m achieved. The poor progress was due to waste handling challenges. The twin declines will serve as access to Blanket orebodies below 34 level where shaft infrastructure does not reach. The decline establishment will be for both access and production through subsequent installation of a chairlift and conveyor system, respectively.
● | 35 level Central Shaft: the 34 and 35 level construction of clear and dirty water dams was completed, and installation of the water management system will be complete in the second quarter of 2024. Support installation was completed in the fourth quarter of 2023.
● | 35 level conveyor: the transition from compressed air operated loading system to hydraulics was successfully completed in the fourth quarter of 2023.
● | The existing TSF is reaching the end of its life; accordingly, a new TSF is required to allow production to continue. The design parameters for the new facility include:

| o | capacity of 13 million tonnes which is anticipated to be adequate for 14 years of production at current deposition rate;
| o | “upstream” design, due to the limited space;
| o | clear water dam and TSF will be lined with a double lining (geotextile and clay liner) and polyurethane liner respectively to avoid contamination of ground water;
| o | the design includes new piping and new pumps for a gland service water and return water system with instrumentation;
| o | new boreholes for monitoring around the facility; and
| o | a waste embankment between the TSF and the mine village for dust prevention.

The anticipated cost of the new TSF is $25.1 million which will be incurred over a period of 3 years (2023: $11.4 million, 2024: $5.4 million and 2025: $8.3 million). Work on the TSF commenced in March 2023 and the first phase of the project was completed at the end of February 2024. The project was behind schedule due to resourcing by the contractor and changes in the design by an external consultant. The contractor had to change the program slightly to re-focus on the lowest areas of the TSF basin to allow limited deposition on the new TSF by end of October 2023 in parallel with further deposition onto the existing TSF until it reaches its maximum capacity. Limited deposition on the new TSF commenced on October 30, 2023, which has subsequently increased to 100% of Blanket’s tailings in 2024. Limited capacity remains on the old TSF, to provide a buffer in the event that there are delays in the completion of further phases in the construction of the new TSF.

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Capital expenditure at Blanket in 2023 amounted to $28.1 million (inclusive of Caledonia Mining South Africa Proprietary Ltd’s (“CMSA”) mark-up). Planned 2023 capital expenditures of $2.2 million were postponed to 2024. Capital expenditure for 2023 included:

● | New TSF (first phase) - $11.1 million;
● | Capital development at 30 and 34 levels - $9.5 million;
● | Utilities for the Central Shaft infrastructure - $1.9 million;
● | Information technology infrastructure - $0.5 million;
● | Electrical engineering - $0.6 million;
● | Mill and surface engineering - $2.4 million; and
● | Staff housing - $365,000.

Capital expenditure at Blanket in 2024 is estimated at $30.8 million (inclusive of CMSA’s mark-up and postponements).

Solar Investment

In 2020, the Company raised $13 million (before commission and expenses) through the sale of 597,963 shares at an average price of $21.74 per share to construct a solar plant. Caledonia initiated a tender process to identify parties to submit proposals for a solar project that would reduce Blanket’s reliance on grid and generator power and provided notice to proceed with construction in 2021. The 12.2 MWac solar plant was connected to the Blanket grid in November, 2022 and fully commissioned in early February 2023. The solar plant provides approximately 24% of Blanket’s electricity demand during daylight hours, reduces Blanket’s reliance on the utility and generator use and cost $14.2 million to complete.

Blanket continues to rely on the grid and generators to provide additional power during daylight hours and at night. Completion of the solar plant coincided with an improvement in the supply of power from the grid which has substantially reduced the amount of diesel consumed. In January 2024 and February 2024 Blanket consumed on average 82,000 litres of diesel per month for 2024 compared to an average of 124,000 litres per month for the whole of 2023. Whilst it is uncertain that this level of improvement will be maintained, the successful implementation of the solar plant is expected to result in a meaningful reduction in diesel usage.

In December 2022, the Caledonia board of directors (the “Board of Directors”) approved a proposal for Caledonia Mining Services (Private) Limited (“CMS”), which owns the solar plant, to issue loan notes (“solar bonds”). This decision was taken to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market. The bonds had an interest rate of 9.5% payable bi-annually and had a tenor of 3 years from the date of issue. The bond repayments are guaranteed by the Company and $7 million of bonds were issued to Zimbabwean commercial entities by CMS. The issuer of the solar bonds was changed from CMS to CHZ during the fourth quarter of 2023 in anticipation of the proposed sale (see below) and in order that Caledonia can maintain and develop the relationship with the Zimbabwean institutional holders of the bonds. $2 million of further bonds were issued to Zimbabwean commercial entities by CHZ in the second quarter of 2024.

Due to the unique operating environment in Zimbabwe and Caledonia’s significant in-country expertise, Caledonia opted to build the solar plant using its own resources rather than relying on an external party to build, operate and own the solar plant using its financial resources and selling the resultant power to Blanket on a long-term contract. Accordingly, Caledonia constructed the solar plant using its own financial resources at a cost of $14.2m. As the solar plant is now fully commissioned and is working as planned, Caledonia no longer needs to own the solar project, provided it retains long term access to the power it produces.

In the second quarter of 2023 management embarked on a process to sell the solar plant. Various offers were received, and a bidder has been given exclusivity to conduct due diligence and further negotiate the sale of the plant after proving their ability to operate and fund solar plants of similar size and complexity. Management is in an advanced stage of finalising the contractual arrangements to sell the solar plant whereby the new owners will exclusively supply Blanket with electricity. This transaction is expected to realise a profit on Caledonia's investment in the plant and release cash for reinvestment in Caledonia’s core business of gold mining that should yield higher returns to our shareholders.

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The solar asset was re-classified as held for sale as at December 31, 2023 in the Consolidated Financial Statements.

Capital projects and expenditures are further analyzed in notes 17 and 18 of the Consolidated Financial Statements and under Item 4.B – “Business Overview”.

Available Information

The SEC maintains an internet site (http://www.sec.gov) that contains report, proxy and information statements and other information regarding issuers that file electronically with the SEC. Such information can also be found on the Company’s website (http://www.caledoniamining.com).

B. Business Overview

Description of Our Business

Blanket Mine

Caledonia’s primary focus is the operation of a gold mine and the exploration and development of mineral properties for precious metals. Caledonia’s activities are focused on Zimbabwe. The Company’s business during the last three completed fiscal years has been focused primarily on increasing production to 80,000 oz. of gold from 2023 onward through its investment plan at Blanket Mine.

Total gold production at Blanket Mine for 2023 was 75,416 oz. (2022: 80,775 oz.; 2021: 67,476 oz.). Gold producers compete globally based on their operating and capital costs. Certain gold producers benefit from their ability to produce other minerals in commercial quantities as by-products. Caledonia derives approximately 0.1% of its revenues from silver, which is insignificant. Over the last three years, 100% of Blanket’s revenues was derived from its operations in Zimbabwe.

The underground drilling program at Blanket targeted the Eroica, Blanket and AR south ore bodies and yielded encouraging results, which were published on July 10, 2023 and January 30, 2024. The total drilling for 2023 was 13,280 meters, and the results indicate that the existing Blanket, Eroica and AR South ore bodies have grades and widths that are generally better than expected. Refer to Exhibit 15.4 for the updated technical report of Blanket, which reflects this new information in a revised resource statement taking into account the increased life of mine.

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Bilboes Project

On July 21, 2022 Caledonia announced that it had signed an agreement (the “Bilboes Agreement”) to purchase Bilboes Gold Limited (“Bilboes Gold”), the parent company which owns, through its Zimbabwe subsidiary, Bilboes Holdings, the Bilboes Project for a total consideration of 5,123,044 Caledonia shares representing approximately 26.8% of Caledonia's fully diluted equity as at today’s date and a 1% net smelter royalty ("NSR") on the Bilboes Project's revenues.

Bilboes is a large, high grade gold deposit located approximately 75 km north of Bulawayo, Zimbabwe. Historically, it has been subject to a limited amount of open pit mining.

The Company understands that the project has produced approximately 291,000 ounces of gold since 1989.

In the fourth quarter of 2022, a small operation was started to mine and process oxide mineralization at Bilboes prior to the declaration of a Subpart 1300 compliant mineral reserve. The oxide mining activities were restarted predominantly with the objective to generate cash flows to pay for the existing cost structures at Bilboes Holdings, the operating company for Bilboes, and this would have an added benefit of reducing the waste-stripping required for the later planned sulphide project. The oxide mine was expected to produce between 12,500 and 17,000 ounces of gold in 2023 at an on-mine cost of between $1,200 and $1,320 per ounce.

On January 6, 2023 Caledonia announced that it had satisfied the conditions precedent to purchase Bilboes Gold. The total consideration was agreed at 5,123,044 Caledonia shares, representing approximately 26.8% of Caledonia's fully diluted equity as at today’s date and a 1% NSR. Following completion of the transaction in January 2023, Caledonia commissioned its own pre-feasibility study to identify the most judicious way to commercialize the Bilboes sulphide project and optimize shareholder returns. One approach that is being considered is a phased development which would minimize the initial capital investment and reduce the need for third party funding.

The target mineralization area (for the oxide mining project) which had been identified using old information obtained from the previous owners (i.e. not the vendors from whom Caledonia purchased the project) was found to have interpreted the oxide / sulphide boundary incorrectly. Mining activity moved to other target areas in the thirdquarter of 2023 where the target oxide mineralization is based on relatively recent drill data for the oxide mineralization. However, the large amount of waste-stripping that needed to be done to access the oxide production areas proved too costly. Accordingly, to prevent further operating losses, the oxide mining activities were placed on care and maintenance at the end of September 2023. Mining activities will exploit remnant oxides once mining production commences for the larger sulphide project with oxides being loaded onto the oxide heap leach pads and suphides fed to the sulphide processing plant. Leaching of ore placed on the heap leach continued in the fourth quarter of 2023 and had no material effect on Caledonia's financial performance. Production and cost guidance for the oxide mining activities was withdrawn in the third quarter of 2023.

Refer to note 5 in the Consolidated Financial Statements for more detail on the Bilboes Gold acquisition and tribute transaction.

On May 15, 2024, 2024, Caledonia announced a Subpart 1300 compliant pre-feasibility study, containing a mineral reserve and mineral resource estimate for the Bilboes Project. The pre-feasibility study, entitled “Bilboes Gold Project Technical Report Summary”, was prepared by DRA Projects (Pty) Ltd with an effective date of December 31, 2023, and is attached as Exhibit 15.6 hereto. We consider the Bilboes Project to be a development stage property for purposes of Subpart 1300, because it contains a Subpart 1300 mineral reserve but does not currently have material mineral extraction.

Motapa-Project

On November 1, 2022 Caledonia acquired from Bulawayo Mining Company Limited (“Bulawayo Mining”) all the shares in Motapa Mining Company UK Limited (“Motapa”), which wholly owns Arraskar Investments (Private) Limited (“Arraskar”), the holder of the registered mining lease over Motapa, for $8.25 million.

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Caledonia considers Motapa to be highly prospective and strategically important to its growth ambitions in Zimbabwe in terms of both location and scale. Motapa is a large exploration property which is contiguous to Caledonia’s Bilboes gold project. Motapa was formerly owned and explored by Anglo American Zimbabwe prior to its exit from the Zimbabwean gold sector in the late 1990s and is approximately 75km north of Bulawayo with a mining lease covering approximately 2,200 hectares. Motapa has been mined throughout most of the second half of the 20th century; Caledonia understands that during this period the region produced as much as 300,000 ounces of gold. Whilst none of the mining infrastructure remains, the evidence of historical mining will provide guidance to our exploration team in best understanding the prospectivity of the region.

Caledonia’s exploration activities are focused on Blanket Mine, Motapa and Maligreen. Motapa and Maligreen are exploration stage projects.

Refer to note 18 of the Consolidated Financial Statements for more detail on Motapa.

Maligreen Project

On September 23, 2021, Caledonia announced that it had entered into an agreement to purchase the mining claims over Maligreen, a property situated in the Gweru mining district in the Zimbabwe Midlands, from Pan African Mining (Private) Limited, a privately-owned Zimbabwean company, for a total cash consideration of US$4 million. The transfer of the claims to Caledonia and the payment of the purchase price was completed during the fourth quarter of 2021.

Maligreen is a brownfield gold exploration project situated on the Nkayi-Silobela Greenstone Belt that has historically been exploited via open pit mining. The total land area of Maligreen is approximately 550 hectares comprising two historic open pit mining operations that produced approximately 20,000 ounces of gold mined from oxides between 2000 and 2002 after which the operation was closed.

Significant historical exploration and evaluation work has been conducted on the property over the last 30 years including regional geochemical and geophysical (aeromagnetic and ground) surveys and 5 tonnes of bulk metallurgical test work. A total of 755 holes, of which 113 were diamond holes, have been drilled at the property over a combined 63,463 metres. These were completed in the period 1995 to 2001.

During 2022 the Company completed a re-logging and re-sampling exercise of a representative sample of previously drilled core which have satisfied the QAQC requirements for upgrading the original Inferred Mineral Resources estimate to Measured, Indicated and Inferred Mineral Resources. Future exploration activities may be considered to further understand the strike and depth extension potential and assess the potential for a mining operation.

A Tribute Agreement was in place with Silobela Youth in Mining Syndicate for the Maligreen claims from 1 October 2020 to 30 September 2023, in terms of which Silobela Youth in Mining Syndicate could undertake mining activities over the claims. Silobela Youth in Mining Syndicate was obliged to pay CHZ 5% of the value of minerals mined or a rental amount. The Silobela Youth in Mining Syndicate is currently engaged in renewing the Tribute Agreement

Refer to note 18 of the Consolidated Financial Statements for more detail on Maligreen.

Other Information

There is no assurance that our mineral exploration activities will result in any discoveries of commercial bodies of mineral reserves. The long-term profitability of our operations will, in part, be directly related to the costs and success of our exploration programs, which may be affected by several factors.

There can be no assurance, even when an economic deposit of minerals is located, that any of our property interests can be commercially mined. The exploration and development of mineral deposits involve a high degree of financial risk over a significant period which a combination of careful evaluation, experience and knowledge of management may not eliminate. While the discovery of additional ore-bearing structures may result in substantial rewards, few properties which are explored are ultimately developed into producing mines. Major expenses may be required to establish reserves by drilling and to construct mining and processing facilities at a particular site. It is impossible to ensure that our current exploration programs will result in profitable commercial mining operations. The profitability of our operations will be, in part, directly related to the cost and success of its exploration and development programs which may be affected by several factors. Additional expenditures are required to establish reserves that are sufficient to commercially mine and to construct, complete and install mining and processing facilities in those properties that are actually mined and developed.

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Mining Operations

Blanket Mine

On November 3, 2014 Caledonia announced the revised investment plan (“Revised Plan”) and production projections for the Blanket Mine. The objectives of the investment plan were to improve the underground infrastructure and logistics to allow efficient and sustainable production build-up. The infrastructure improvements included the continuation of the No. 6 Winze, the development of a “Tramming Loop” and the sinking of a new 6-meter diameter Central Shaft from surface to 1,080 meters (which was eventually extended to 1,204 meters).

Caledonia’s Board of Directors and Management have completed a review of alternative expansion and diversification plans for Caledonia. Both the Board of Directors and Management have also addressed the revised production projections for the Blanket Mine and the possible benefits of diversifying Caledonia’s production base. Caledonia has concluded its best returns on investment remain at the Blanket Mine in Zimbabwe, which continues to be cash generative.

Exploration at Blanket Mine’s portfolio of satellite properties was suspended in 2016 so that resources could be re-deployed at Blanket. Since then, the Company has evaluated other investment opportunities in Zimbabwe and has concluded that the satellite properties other than GG are unattractive due to their relatively small size, low grade, limited exploration potential, operating complexity and metallurgical incompatibility with the existing Blanket Mine plant. The GG satellite property remains on care and maintenance.

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Metallurgical Process

Metallurgical plant – Blanket Mine

The Blanket gold plant established on the Blanket Mine site consists of crushing, milling, carbon-in-leach and batch elution electro-winning circuits. Recoveries in 2023 were 93.8%, the same as in 2022.

The installation of ball mill BM10 and repairs increased the metallurgical production capacity to 2,400 tonnes per day. The increased milling capacity enabled Blanket to increase tonnage milled from 1,976 tonnes per day during June 2022 to 2,379 tonnes per day on August 23, 2022. The record 770,440 tonnes milled for 2023 was 2.4% higher than the 752,033 tonnes milled in 2022.

During the fourth quarter of 2022, Blanket finished construction of a conveyor and crushing system to feed ore from the Central Shaft to a primary crusher from which it will be transported to the metallurgical plant which is located approximately 800 metres away, close to the No. 4 Shaft. The project was commissioned in November 2022.

Safety, Health and Environment

The following safety statistics have been recorded for the year 2023 and the preceding two years.

Classification | 2021 | 2022 | 2023
Fatal | - | 1 | 1
Lost time injury | 3 | 4 | 9
Restricted work activity | 6 | 4 | 18
First aid | 1 | 5 | 1
Medical aid | 21 | 12 | 7
Occupational illness | - | - | 0
Total | 31 | 26 | 36
Incidents | 62 | 39 | 37
Near misses | 22 | 18 | 19
Disability Injury Frequency Rate | 0.26 | 0.23 | 0.74
Total Injury Frequency Rate | 1.05 | 0.75 | 0.95
Man-hours worked (thousands) | 6,199 | 6,947 | 7,531

The number of incidents as reflected in the Total Injury Frequency Rate increased in 2023 compared to 2022 and was similar to 2021. Blanket’s safety performance compares favourably with other deep level underground gold mines; however, management believes the safety performance at Blanket should be seen as a continuous focus area. The Nyanzvi 2 initiative (discussed below) is designed to increase safety awareness and reinforce strict adherence to prescribed safety procedures.

Nyanzvi Initiative

During 2023 102 employees trained on Nyanzvi 2 training. Co-creation training of the engineering leadership comprise 17 section engineers, manager, foremen and charge hands. An engineering pilot team of 11 employees was trained. Team rankings for the best performers for all departments continued in the fourth quarter of 2023.

Sources and Availability of Raw Materials

All of the raw materials the Company requires to carry on its business are available through normal supply or business contracting channels. The Company has not experienced a shortage of availability of raw materials or significant price volatility.

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Exchange Controls, Social Investment and Contribution to the Zimbabwean Economy

Exchange control approvals from the RBZ and the Reserve Bank of South Africa are required on the flow of funds in and out of Zimbabwe and South Africa. The Company obtained necessary approvals from both the RBZ and the Reserve Bank of South Africa to transfer foreign currency during the fiscal year ended December 31, 2023.

Additionally, Blanket Mine’s investment in community and social projects which are not directly related to the operation of the mine or the welfare of Blanket Mine’s employees, the payments made to the Community Trust in terms of Blanket Mine’s indigenization, and payments of royalties, taxation and other non-taxation charges to the Zimbabwe government and its agencies are set out in the table below.

Payments to the Community and the Zimbabwe Government ($’000’s)
|  | Community and Social Investment | Payments to GCSOT | Payments to Zimbabwe Government (excl. royalties) | Royalties | Total
Year 2021 |  | 1,163 | 948 | 16,426 | 6,083 | 24,620
Year 2022 |  | 888 | 1,200 | 12,060 | 7,124 | 21,272
Year 2023 |  | 1,491 | 550 | 11,871 | 7,316 | 21,228

Community and social responsibility (“CSR”) initiatives fall under seven pillars of education, health, women empowerment and agriculture, environment, charity, youth empowerment and conservation.

The main CSR programme at Blanket relates to the refurbishment of the maternity clinic, the primary and secondary schools, and the youth centre at Sitezi, which is located approximately 17km from Blanket. Activities in respect of this project during 2023 included:

● | Completing renovations of five classrooms, three offices, one computer laboratory, and one science laboratory at Sitezi Secondary School. The renovations included tubing and wiring of electricals and putting up ceilings. Renovation of the secondary school administration block also commenced in the fourth quarter of 2023.
● | Construction of the waiting mothers’ shelter began and was at slab level by end of the fourth quarter of 2023; completion is expected in the first quarter of 2024. Repairs to the clinic buildings such as doors, windows, painting walls, and roof repairs were also done.
● | The bulk of materials, such as batteries and other accessories, for the solar plant to supply the clinic, secondary school and primary school with power, was procured in the fourth quarter of 2023 and installation is expected to start in the first quarter of 2024. The solar power will help maintain cold chains for medical supplies and samples at the clinic and provide lighting and energy supply to the clinic and the two schools for powering IT equipment such as computers and interactive boards.
● | To ensure a secure and stable supply of water for the Gwakwe Garden irrigation scheme, Blanket continued supplying irrigation water to the garden from Smiler shaft. The water augmentation project to connect four boreholes to the garden which began during the second quarter continued in the current quarter. Pipes for the pipeline were laid out, and connection to the national electricity grid was completed in the fourth quarter of 2023.
● | Work on upgrading the Sabiwa Stadium to meet the requirements of the Zimbabwe Football Association for Division 1/Premier Soccer League stadia in the country continued with the extension of the pitch and running tracks. Material for building changing rooms and ablution facilities was delivered on site with construction set for the first quarter of 2024. The stadium, which had been used exclusively by Sabiwa High School, will cater for footballing activities for the entire local community.

Blanket undertook road repairs of the old Gwanda Road, patching the potholes on the road which had become a hazard.

Under the conservation pillar, Dambari Wildlife Trust was granted $113,000 to carry out its work on conserving black and white rhinos in the Matopos Hills areas. The last disbursements of the grant were made in the fourth quarter of 2023. Dambari Trust is working with Victoria Falls Wildlife Trust as its subgrantee.

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A dividend of $550,000 was paid to the Community Trust in 2023 and $450,000 in March, 2024. GCSOT has a 10% shareholding in Blanket, donated by Caledonia.

General Comments

Caledonia’s activities are centered on Zimbabwe and occur year-round. Caledonia is not dependent, to any material extent, on patents, licenses, contracts, specialized equipment or new manufacturing processes at this time. However, there may be occasions that Caledonia may wish to adopt such patents, licenses, specialized equipment, etc. if these are economically beneficial to its operations. All mining and exploration activities are conducted under the various economic, mining and environmental regulations of the country where the operations are being carried out. It is always Caledonia’s standard that these regulations are complied with by Blanket Mine. Caledonia has not experienced a shortage of availability of raw materials or significant price volatility.

Refer to note 4(b)(i) of the Consolidated Financial Statements and Item 3.D – “Risk Factors”, under the subheading “We do business in countries and jurisdictions outside of the United States where different economic, cultural, regulatory, monetary and political environments could adversely impact our business, results of operations and financial condition” where the material effects of government regulations of the Company’s business are disclosed.

Investors should recognize that Blanket’s ability to implement its investment plans at its properties and interests and Caledonia’s ability to sustain its operations outside Zimbabwe and pay future dividends depends, inter alia, on the ability to externalize cash from Zimbabwe.

Revenue from the sale of precious metals is recognized when the unrefined metal is accepted at the refinery (“Local lodgment date”) by Fidelity, except for the portion earmarked for export to a refiner outside of Zimbabwe. Control is transferred and the receipt of proceeds is substantially assured at point of delivery at the end refiner with the responsibility to pay. Revenue for each delivery to Fidelity is measured at the LBMA price post-delivery less 1.25% and the quantities are determined on Local lodgment date. On average, settlement occurs within 14 days of delivery from Fidelity and within 2 days from AEG.

A portion of unrefined metals produced by Blanket is exported by Caledonia to AEG, an accredited Dubai Good Delivery refinery, which makes payment to Caledonia's bank account in Zimbabwe in USD. The exported unrefined gold continues to be processed at Fidelity, a subsidiary of the RBZ, on a toll-treatment basis, in accordance with requirements of the Zimbabwe government for in-country refining and to allow the Zimbabwe authorities full visibility over the gold produced and exported by Caledonia. The resultant gold is exported under the gold dealing license that is held by Fidelity to a refinery outside Zimbabwe (i.e. AEG) which undertakes the final refining process. Caledonia receives the proceeds of the gold which it exports in its bank account in Zimbabwe within a few days of delivery to the final refiner. This arrangement in respect of production from Blanket complies with the current requirements to pay a 5% royalty on gold sales and 1.25% of gross sales which is payable to the Zimbabwean Government and deducted from USD and RTGS$ or ZiG revenues proportionately. The retention threshold remained unchanged after the introduction of the ZiG.

For deliveries exported and for deliveries that are paid by Fidelity, Blanket continues to receive 75% of its revenues in US Dollars and the balance in local currency. Revenue for the unrefined metals exported to a refiner outside Zimbabwe from the sale of precious metals is recognized when the refiner outside of Zimbabwe receives the unrefined metals (“Export lodgment date”). Control is transferred and the receipt of proceeds is substantially assured at the point of delivery. Export lodgment date revenue for each delivery is measured at the LBMA price post-delivery less a refining fee and the quantities are determined on Export lodgment date. On average settlement occurs within two days of delivery.

Revenue from the sale of precious metals at Bilboes is recognized on the Local lodgment date by Fidelity. Control is transferred and the receipt of proceeds is substantially assured at point of delivery at the end refiner with the responsibility to pay. Revenue for each delivery to Fidelity is measured at the LBMA price post-delivery less 1.25% and the quantities are determined on Local lodgment date. Part of the Bilboes revenue during the year was recognized from sales to Fidelity as a “small-scale producer”, measured at the previous day’s 6pm LBMA price less a 5% discount. The revenue was received 100% in USD and settlement occurred immediately after depositing of the bullion.

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C. Organizational Structure

The Company has the following organizational structure as at April 26, 2024:

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D. Property, Plant and Equipment and Exploration and evaluation assets

Overview

The Company is engaged in the exploration, development and production of gold and other precious metals from its mineral properties. The Company’s four material mineral properties, all located in Zimbabwe, are:

● | the production stage Blanket Mine (64% interest);
● | the exploration stage Maligreen project (100% interest);
● | the development stage (sulphides) at Bilboes Project (100% interest), at which minor oxide gold production occurred during the period; and
● | the exploration stage Motapa (100% interest).

The Blanket Mine and its satellite operations are located in the Matabeleland South province, the Maligreen project is located in the Midlands province and Motapa and the Bilboes is in the Bulawayo province as illustrated below.

The Company does not have interests in any other mineral properties, following the disposition of the Company’s interests in Connemara North, Glen Hume, Eagle Vulture, Mascot and Penzance, and Eersteling.

Certain of the information set forth in this annual report is derived from the following:

● | For the Blanket Mine, the Subpart 1300 pre-feasibility study entitled “S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe”, with an effective date of December 31, 2023, prepared by Qualified Persons Mr. Craig Harvey and Mr. Marthinus van Staden. Refer to Exhibit 15.4 and Exhibit 15.8 in this report; and

● | For the Maligreen project, the Subpart 1300 initial assessment entitled “S-K 1300 Technical Report Summary on the Maligreen Gold Project, Zimbabwe”, with an effective date of December 31, 2022, prepared by Qualified Person Mr. Uwe Engelmann. Refer to Exhibit 15.5 in this report.

● | For the Bilboes Project the Subpart 1300 pre-feasibility study entitled “Bilboes Gold Project Technical Report Summary”, with an effective date of December 31, 2023, prepared by Qualified Person DRA Projects (Pty) Ltd. Refer to Exhibit 15.6 in this report.

Mr. Craig Harvey and Mr. Marthinus van Staden, have been full-time employees of the Company as from 1 March 2023 and November 1, 2021 respectively. Mr. Engelmann is not an employee of the Company. Mr. Engelmann is employed by Minxcon (Pty) Ltd. None of Mr. Engelmann or DRA Projects (Pty) Ltd is affiliated with Caledonia or another entity that has an ownership, royalty or other interest in the property that is the subject of the respective technical report summary.

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Three Year Production History

The Blanket Mine is the Company’s only property with current mineral extraction. Minor oxide extraction occurred at Bilboes in 2023. The Bilboes oxide extraction was curtailed during 2023 favor of focusing on the larger sulphide feasibilty study. Aggregate annual production information for our properties for the years ended December 31, 2023, 2022 and 2021 is provided below on a 100% project basis, rather than an attributable basis.

Property | Ounces produced
| 2023 | 2022 | 2021
Blanket | 75,416 | 80,775 | 67,476
Bilboes | 3,050 | - | -
Total | 78,466 | 80,775 | 67,476

Mineral Resources

Mineral resources are stated as exclusive of mineral reserves and as attributed values. Ordinary kriging and inverse distance estimation methodology was employed and confined to the property boundaries to which we have legal rights to explore and mine.

The Blanket Mine mineral resources occur as underground resources and estimates have been depleted for mining. Measured, indicated and inferred mineral resources are declared due to the continuity of the geology and grade as well as a history of proven historical mining. The inferred mineral resources show geological continuity, while grade continuity requires improvement through additional drilling. A cut-off of 1.5 g/t was utilized for Blanket Mine based on an average real term gold price of US$2,150/oz based on a 10-to-15 year view for precious metals. Geological losses of 2.5% were applied to the Blanket Mine measured mineral resources, while a 5% loss was applied to the indicated mineral resource and 10% to the inferred mineral resource category.

There has been no change year on year for the mineral resources at Maligreen. All mineral resources are reported at surface (all mineral resources <220 m from surface) and underground (>220 m from surface). The mineral resources have been depleted by means of topography and mining voids. Following confirmatory re-logging and re-sampling of historical core along with the robust geological mode, the data previous inferred mineral resources can now be declared as a measured, indicated and inferred mineral resources. A cut-off of 0.4 g/t was applied to the surface resources, while a cut-off of 1.5 g/t was applied to the underground portion based on a gold price of US$1,800/oz based on a 10-to-15 year view for precious metals. Discounts applied to the mineral resources include geological losses of 5% for measured, 10% for indicated and 15% for inferred mineral resources to account for geological, data and estimation uncertainty.

The Bilboes Mine mineral resources occur as surface resources constrained by an optimised open pit shell at a fixed gold price of US$2,400/oz in order to eliminate possible future sterlization of mineral resources due placement of surface infrastructure. All estimates have been depleted for mining and current topographical surface. Measured, indicated and inferred mineral resources are declared due to the continuity of the geology and grade as well as a history of proven historical mining. A cut-off of 0.9 g/t was utilized for Bilboes based on a gold price of US$2,400/ oz. Geological losses of 5% were applied to the measured, indicated and inferred mineral resources..

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| December 31, 2023
In Situ Mineral Resources Exclusive of Mineral Reserves | Tonnes | Grade | Gold
| (Mt) | (g/t) | (koz)
Zimbabwe | Blanket Mine | Measured | 2.70 | 3.72 | 323
| Underground | Indicated | 2.73 | 3.23 | 283
| (64% attributable) | Measured + Indicated | 5.43 | 3.47 | 606
|  | Inferred | 5.65 | 3.74 | 679
| Maligreen | Measured | 1.65 | 2.38 | 126
| Surface | Indicated | 6.29 | 1.53 | 310
| (100% attributable) | Measured + Indicated | 7.94 | 1.70 | 434
|  | Inferred | 4.58 | 1.55 | 229
| Maligreen | Measured | - | - | -
| Underground | Indicated | 0.09 | 2.76 | 8
| (100% attributable) | Measured + Indicated | 0.09 | 2.89 | 8
|  | Inferred | 1.59 | 3.75 | 192
| Bilboes | Measured | 0.24 | 1.85 | 14
| Surface | Indicated | 8.48 | 1.79 | 488
| (100% attributable) | Measured + Indicated | 8.72 | 1.79 | 502
|  | Inferred | 9.12 | 1.91 | 560
Total Measured | 4.59 | 3.13 | 463
Total Indicated |  |  | 17.59 | 1.93 | 1 089
Total Measured + Indicated |  | 22.18 | 2.18 | 1 552
Total Inferred |  |  | 20.94 | 2.47 | 1 660
Grand total |  |  | 43.11 | 2.32 | 3 212

Mineral Reserves

Mineral Reserves are stated as fully diluted, delivered to the processing plant and are backed by detailed planning such as a Life of Mine plan. Only Measured and Indicated Mineral Resources have been converted to Mineral Reserves.

At Blanket Mine, the Mineral Reserve is based on a discounted cash flow analysis, the result of which is positive over an eleven year period until 2034 and utilises only Measured and Indicated Mineral Resources. The gold price is based on commodity forecasts from a number of institutions and the average gold price over the eleven year life of mine is $1,877 per ounce. The first three years gold price is derived from the median forecast of various institutions and ends in a long term gold price of US$1,731/oz. Mineral Reserves are stated at a cut-off grade of 2.10 g/t. Production costs utilise the production history from the mine together with required capital expenditure to execute the life of mine plan. All mineral reserves at Blanket mine are from underground sources.

At Bilboes, the Mineral Reserve is based on an independent economic analysis conducted by external consultants. A production plan has been executed using a Whittle analysis with a long term gold price of $1,800 per ounce, based on a 24-month (2022-2023) trailing average gold price of US$ 1,875/oz, at a cut-off grade of 0.9 g/t. All mineral reserves from Bilboes are declared as surface reserves derived from open pit mining.

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Diluted Mineral Reserves (delivered to plant) | December 31, 2023
| Tonnes (Mt) | Grade | Gold
Zimbabwe | Blanket Mine |  |  |
| Proven | 1.36 | 3.21 | 141
| Underground Probable (64% attributable) | 3.56 | 3.31 | 379
| Proven + Probable | 4.92 | 3.29 | 519
| Bilboes |  |  |
| Proven | 5.90 | 2.42 | 455
| Surface Probable (100% attributable) | 19.10 | 2.31 | 1 418
| Proven + Probable | 24.90 | 2.34 | 1 873
Total Proven | 7.26 | 2.55 | 596
Total Probable | 22.66 | 2.47 | 1 797
Total Proven + Probable | 29.82 | 2.50 | 2 392

Regional Geological Setting

Zimbabwe’s known gold mineralization occurs in host rocks of the Zimbabwe Craton, which is made up of Archaean rocks. The geology of the Craton is characterized by deformed and metamorphosed rocks which include high-grade metamorphic rocks, gneisses, older granitoids, greenstone belts, intrusive complexes, younger granites and the Great Dyke. The Chingezi gneiss, Mashaba tonalite and Shabani gneiss form part of a variety of tonalities and gneisses of varying ages. Three major sequences of slightly younger gold-bearing greenstone belt supracrustal rocks exist:

● | Older greenstones called the Sebakwian Group, which are mostly metamorphosed to amphibolite facies. They comprise komatiitic and basaltic volcanic rocks, some banded iron formation (“BIF”), as well as clastic sediments.
● | The Lower Bulawayan Group, which comprises basalts, high-Mg basalts, felsic volcanic rocks and mixed chemical and clastic sediments. The Lower Bulawayan Group forms the Belingwe (Mberengwa) greenstones.
● | The Upper Bulawayan (upper greenstones) and Shamvaian groups, which comprise a succession of sedimentary and komatiitic to tholeiitic to calc-alkaline rocks.

Three metamorphic belts surround the Zimbabwe Craton:

● | Archaean Limpopo Mobile Belt to the south;
● | Magondi Mobile Belt on the north-western margin of the Craton; and
● | Zambezi Mobile Belt to the north and northeast of the Zimbabwe Craton.

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Material Properties

Blanket Mine

Property Description and Ownership

The Blanket Mine is an operating underground gold mine situated on the Gwanda Greenstone Belt (“GGB”) targeting shear zone hosted gold mineralization. The Mine complex comprises a cluster of mines extending from Lima in the north, through Eroica, Sheet, AR Main, AR South, the currently defunct Feudal, Blanket Section (Blanket 1 to Blanket 6) and Jethro over a total strike length of some 3 km. Gold has been commercially mined at the project area from several closely-spaced orebodies defining a mineralized trend via several shafts since the early 1900s. The Mine covers the operating claims of Jethro, Blanket, Feudal, Harvard, Mbudzane Rock, Oqueil, Sabiwa, Sheet, Eroica and Lima, largely encompassed in a 2,120ha Mining Lease. Ore is processed at an on-site plant. As at December 31, 2023 the net assets of Blanket Mine is $200 million. Refer to note 28 of the Consolidated Financial Statements.

The Company indirectly owns 64% of the shares of Blanket Mine, the operator of which is Blanket Mine (1983) (Private) Limited, after the purchase of Fremiro’s 15% shareholding became effective in January of 2020. The Blanket Mine is fully equipped with all the necessary plant and equipment to conduct mining operations and the production of gold from the ore mined from the mine.

As illustrated below, the Mine is located in the southwest of Zimbabwe, approximately 15 km northwest of Gwanda, the provincial capital of Matabeleland South. Gwanda is located 120 km southeast of Bulawayo, 200 km northwest of the Beitbridge Border post with South Africa, and 560 km from Harare, Zimbabwe's capital city. The Mine is centered on the coordinates (WGS84 system) 20°52' S, 28°54' E.

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The table below indicates the aggregate annual production from Blanket in the last three fiscal years on a 100% project basis:

Blanket Production Statistics
Year | Tonnes Milled (t) | Gold Head (Feed) Grade (g/t Au) | Gold Recovery (%) | Gold Produced (oz)
2021 | 665,628 | 3.36 | 93.9 | 67,476
2022 | 752,033 | 3.56 | 93.8 | 80,775
2023 | 770,440 | 3.25 | 93.8 | 75,416

The table below indicates the aggregate annual production from Blanket in the last three fiscal years on a 64% attributable project basis:

Blanket Production Statistics
Year | Tonnes Milled (t) | Gold Head (Feed) Grade (g/t Au) | Gold Recovery (%) | Gold Produced (oz)
2021 | 426,002 | 3.36 | 93.9 | 43,179
2022 | 481,301 | 3.56 | 93.8 | 51,696
2023 | 493,082 | 3.25 | 93.8 | 48,266

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Blanket Mine employs two mining methods that are well suited to the nature of the mineral deposits. The extreme variation within the Blanket Mine mineral deposits necessitates modification of the exact mining methods that suit the specific characteristics of each deposit. The general practice on the mine is to implement one of two tailored mining methods, determined mainly by the width of the mineral deposit.

The two mining methods utilised are:

● | Long-hole stoping in wider mineral deposits (orebody widths generally more than 3 m); and
● | Underhand stoping in narrow mineral deposits (orebody widths generally less than 3 m).

The planned thrust in development is aimed at opening up ground below 750 m Level which will be the primary production areas, as well as create the necessary exploration drilling platforms. In the Lima, ARS, Blanket and Blanket Feudal areas some mining activities will take place above 750 m Level.

Infrastructure at Blanket Mine as well as power and water supply are well-established infrastructure to support and sustain mining and processing operations. To date, in excess of 1 million ounces of gold have been produced from the property.

The Blanket Gold Plant established on the Blanket Mine site consists of crushing, milling, carbon-in-leach and batch elution electro-winning circuits. The plant treats an average of 62,000 tonnes per month at a recovery of approximately 94%. The recovery performance is expected to continue, while the processing rate could be increased once planned milling upgrade has been completed. Construction of phase 1A of a new tailings storage facility was completed in 2024, with a design to ensure international best practice is met whilst enabling uninterrupted production.

For a detailed breakdown of the property, plant and equipment and encumbrances thereon refer to note 17 of the Consolidated Financial Statements. The property, plant and equipment of the Group is predominantly held in Zimbabwe and the continued implementation of the investment plan is expected to increase the property, plant and equipment of the Group. Refer to note 18 of the Consolidated Financial Statements for a detailed breakdown on the exploration and evaluation properties of the Company and encumbrances thereon, as well as Item 4.A - “History and Development of the Company”.

The issuing and control of mineral rights in Zimbabwe is regulated by the Mines and Minerals Act (Chapter 21:05) of 1961 (“MMA”), administered by the Mining Commissioner of the regional mining district. The mineral resources are vested in the State through the President of Zimbabwe.

The Government of Zimbabwe does not participate in managing the projects of local or foreign firms in the private sector. Presently, government participation in mining is through Zimbabwe Mining Development Corporation (“ZMDC”) and through the Minerals Marketing Corporation of Zimbabwe (“MMCZ”). The ZMDC was formed in 1982 for government to participate in the mining sector and to save companies that were being threatened to close. It is active in exploration, mining and giving assistance to cooperatives and small-scale miners. The MMCZ was formed in 1992 and is responsible for marketing all the country's minerals and metal products except gold and silver which are sold through the Reserve Bank. It finances its operations by a commission charge of 0.875% on sales conducted for its clients.

In Zimbabwe, mining and mine development may be conducted with a mining claim, mining lease, special mining lease and special grant. A mining claim covers a small area, thus usually several claims are grouped to form a block of claims. The claim confers on the holder the exclusive right to mine the mineral resource for which the claim was registered. Mining claims are dependent on the claim holder applying to the Mining Commissioner for and obtaining an inspection certificate on an annual basis; failure to do so may result in the forfeiture of the relevant claim. A block of claims may be transformed into a mining lease for simplicity of administration.

The Blanket Mine's interests in Zimbabwe include a mining lease, operating claims (i.e., on-mine), non-operating claims and a portfolio of brownfields exploration projects (satellite projects). Blanket Mine operates under a mining lease issued by the Mining Affairs Board of Zimbabwe with registered number 40 (“ML40”) which was issued under the MMA to Blanket Mine (1983) (Private) Ltd, a 64% held indirect subsidiary of the Company, on May 24, 2019 and is annually renewed. The mine’s claims under the lease cover an area of 2,120 ha.

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A copy of ML40 is attached hereto as Exhibit 4.9.

Blanket Mine also has several registered claims, not incorporated under the lease. The 90 claims contiguous to the mining lease comprise a total area of approximately 998 ha. In addition, Blanket Mine holds several non-operating claims located away from ML40 and the adjoining claims described above, that form a portion of the Gwanda portfolio. These non-producing claims (satellite projects) consist of 184 blocks of registered base metal (Ni, Cu and As) and precious metal claims covering a total area of 2,433 ha. A number of claims are subject to active tribute agreements between the Mine and local small scale miners as part of the CSR.

History

The Blanket Mine is part of the Sabiwa group of mines within the Gwanda Greenstone Belt from which gold was first extracted in the 19th century. The Blanket Mine is a cluster of mines extending some 3 km from Jethro in the south through Blanket itself, Feudal, AR South, AR Main, Sheet, and Eroica, to Lima in the north. Blanket Mine has produced over a million ounces of gold during its lifetime.

Following sporadic artisanal working, the Blanket Mine was acquired in 1904 by the Matabele Reefs and Estate Company. Mining and metallurgical operations commenced in 1906 and between then and 1911, 128,000 t were mined. From 1912 to 1916 mining was conducted by the Forbes Rhodesia Syndicate who achieved 23,000 t. There are no reliable records of mining for the period between 1917 and 1941 and it is possible that operations were adversely affected by political instability during World Wars I and II. In 1941 F.D.A. Payne produced some 214,000 t before selling the property to Falconbridge in 1964 (Blanket Mine, 2009). Under Falconbridge, production increased to 45 kg per month and the property yielded some 4 Mt of ore up until September 1993. Kinross Gold Corporation (“Kinross”) then took over the property and constructed a larger Carbon-in-Leach plant with a capacity of 3,800 tpd. This was designed to treat both run of mine (“RoM”) ore and an old tailings dump.

The Blanket Mine is currently 64% indirectly owned and operated by Caledonia, which initially completed the purchase of the mine from Kinross on 1 April 2006. The Blanket Mine re-started production in April 2009 after a temporary shut-down due to the economic difficulties in Zimbabwe.

Present Condition and Infrastructure

The Blanket Mine consists of a series of small shafts providing access to the underground workings of the various orebodies that are being mined. The main access and draw points are accessed by the shafts indicated in the table below.

Name | Description
Jethro Shaft | The shaft has dimensions of 3 m x 2 m and is mainly utilised for the transport of men and material from surface to 7 Level. The shaft is equipped with a single drum winder with a 22 mm rope and capacity of 10 men.
5 Winze (Sub-Shaft) | 5 Winze has dimensions of 3 m x 2 m and is a sub-shaft and is mainly used to transport men and materials between 7 Level and 22 Level. This shaft is similarly to Jethro shaft equipped with a single drum winder with a 20 mm rope and a capacity of 10 men.
6 Winze (Sub-Shaft) | 6 Winze has dimensions of 3 m diameter and is a sub-shaft used mainly for the hoisting of ore from 26 Level to 22 Level from where ore is transported to No. 4 Shaft for hoisting to surface. This shaft is equipped with a 112 kW single drum winder with a 24 mm rope and a capacity of 3 t per skip or 500 tpd. At the bottom of 6 Winze shaft is a 12kW spillage pump.
Blanket Shaft (No. 4 Shaft) | No. 4 Shaft was historically the main production shaft of Blanket Mine. No. 4 Shaft has dimensions of 4 m x 2 m with two compartments. This shaft is mainly used for the hoisting of ore and waste rock from 22 Level to surface. The shaft is equipped with a 560kW thyristor driven double drum winder with a 34 mm rope and capacity of 5t per skip or 2,000 tpd.
Central Shaft | The new CMS is not lined and has a four-compartment, 6 m diameter layout, equipped with a 2 x 3,132 kW double-drum winders, one rock and the other men and material. The shaft is used as the main route for the transport of men, material, and rock. The shaft reaches a depth of 1,201.3 meters. The man compartment has a double deck and can transport 40 persons per deck.

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The Blanket Mine is an underground mine in the production stage, and a number of expansion projects have either been completed or are planned for the Blanket mining operations in order to increase production. The majority of the expansion projects will consist of the below 750 m Level (22 Level) expansion projects.

The first project included the sinking and construction of the Central Shaft in-between the AR Main and AR South/ Blanket orebodies from surface to 1,204 m (just above 38 Level) and its associated infrastructure. Sinking and equipping of the shaft, the associated ore pass system and loading station development have all been completed. Currently the water handling system is being finalized..

Further projects include the development of various decline shaft infrastructure targeting specific mining areas in order to increase production.

Surface infrastructure comprises mine offices, change houses, mine headgears, workshops, storerooms, a processing plant, hospital, tailings facility and an assay laboratory. Production shafts on surface consist of the No. 4 Shaft and the Jethro Shaft. Sub-shaft infrastructure in the form of the No 5 Winze connects Jethro to the underground workings. Other shafts and raise bore holes on surface, primarily used for ventilation purposes, include Lima, Eroica and Sheet. A total of 11 hoists are installed at the mine, three of which are used for ore handling (No. 2 incline shaft, the sub-vertical shaft and 6 Winze shaft).

The existing infrastructure at Blanket will be utilized in parallel with new infrastructure which is specifically aimed at targeting the below 22 Level mining areas. The extensions entailed the sinking of the Central Shaft from surface down to 1,201.3 m (just above 38 Level). 6 Winze sub-shaft located close to 5 Winze sub-shaft is used to access the Blanket complex below 22 Level and will provide secondary access to the Central Shaft.

The Central Shaft is not lined and has a four-compartment, 6 m diameter layout, equipped with 2 x 3,142 kW double-drum winders, one for rock and the other for men and material.

On surface, a 1050 mm wide, 152 m long overland ore conveyor will transport the hoisted rock at CMS to the primary crusher and then to an ore dump.

Additional supporting surface infrastructure will include shaft offices, change rooms, lamp rooms, etc. New housing for both senior and junior staff is also planned in anticipation of the increased production profile.

A TSF is also located near the project area. The labour force and their families reside within a kilometre of the mine in accommodation provided by the mine.

Underground drilling is conducted with Seco 23, Seco 25, Seco 215 rock drills and Seco 36 (Konkola) drifters. The rock drills are used mainly for development and the drifters for production, i.e. long-hole drilling.

Similar to the underground rail-bound fleet, the same mining equipment utilized at the operational sections of Blanket Mine will be utilized once the expansion projects of the Central Shaft have been completed with some additional quantities to allow for the planned increase in production.

ZESA supplies power to Blanket Mine from their main Eagle Vulture 132KV/33KV substation about 17km out of Gwanda. The main supplies are the 33 kV and the 11 kV overhead lines. The 33 kV supply feeds Lima, Reclamation, the main substation at No. 4 Shaft (and adjacent to the processing plant) and Central Shaft and New Compressors. The 11 kV supply feeds slimes dam, Smiler shaft and the village. The 11 kV is further transformed to 550 V supply at Smiler and at Slimes dam. The ZESA power allocation to No. 4 Shaft, Central Shaft, Jethro Shaft, 5 Winze and 6 Winze Complex is 18MVA with a current nominal maximum demand (“NMD”) of 18MVA. An additional (Mtshabezi line) feeder is installed with a current nominal maximum demand (“NMD”) of 7 MVA.

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Blanket Mine has investigated and approved the option of employing a solar power plant to supplement existing power supply to the Blanket Mine. The solar plant was installed and commissioned in February 2023. The solar plant supplies 12 MW AC to the Blanket Mine power supply during daytime.

Blanket also has 4 x 2.5 MVA generators at No. 4 Shaft with total installed capacity of 10 MVA. Additional standalone diesel generators with suitable switchgear, transformers, and controls were also installed at CMS to ensure that the mine can stay operational during power interruptions. This additional installation has a total installed capacity of 8 MVA. Total installed generator capacity at Blanket is 18 MVA

The following initiatives have been implemented or are planned to alleviate the power issues:

● | Increased Blanket’s diesel generating capacity to 18MW of installed capacity which was sufficient to maintain all operations and capital projects but only on a stand-by basis.
● | On the incoming ZESA supply line at the No. 4 Shaft, Blanket installed two 10MVA auto tap transformers to protect equipment at No. 4 Shaft and the main metallurgical plant from voltage fluctuations on the incoming grid supply. Following the installation of these transformers, Blanket has used less diesel in the production of gold.
● | On the incoming ZESA supply line at the Central Shaft, two 10MVA autotap transformers were installed in the fourth quarter of 2022 at a cost of $0.9 million. This installation reduced the voltage fluctuations and reduced the power cost and diesel usage allocated to capital projects during the fourth quarter of 2023 and thereafter should reduce operational expenditure when the Central Shaft starts to hoist ore.
● | Caledonia’s 12.2 MWac solar plant, fully commissioned early February 2023, provides approximately 27% of Blanket’s average daily electricity demand. The plant has been providing power to Blanket from its initial connection to the Blanket grid in November 2022. The project was completed at a cost of $14.2 million in 2023 (including construction costs and other project planning, structuring, funding and administration costs).
● | Management is in discussion with the Zimbabwean power utility to obtain an improved supply of electricity. This may include an additional supply line that will result in fewer outages and a power supply that has a higher power factor. Blanket may potentially pay a different KWh rate for this supply line. At the date of approval of this document no agreement with ZESA had been concluded. Management continues to engage with the Intensive Energy User Group regarding the import of electricity from power producers in Zambia and Mozambique and for this power to be wheeled via the Zimbabwe grid to Blanket. If these discussions are successful, it is expected that Blanket’s continuity of electricity supply will improve.

The district is serviced by telecommunication services, and Blanket provides its own Wi-Fi and communication systems.

The A6 highway, forming part of the Trans-African Highway network, is orientated roughly northwest-southeast and links Bulawayo with the Beitbridge border post and Musina in South Africa. The highway runs through the town of Gwanda. A major sealed road, the Old Gwanda Road, branches off from the A6 in Gwanda and runs directly through the ML 40 area to Bulawayo. Blanket’s mining claims are all located along these major roads and are thus easily accessible. The roads are sealed and although potholing is frequent, the surfaces are navigable by all vehicles. The Beitbridge Bulawayo Railway runs roughly parallel to the A6 through Gwanda Town.

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An airstrip and informal airport building are located in Gwanda along the A6. The Joshua Mqabuko Nkomo International Airport is located in Bulawayo. The mine can be accessed either via the Beitbridge-Bulawayo road, or by flying into Bulawayo and driving two hours via the Old Gwanda Road or the A6 to the site.

Permitting, Licenses and Encumbrances

The mine is compliant in terms of authorizations and adheres to all government protocols and regulations as required.

Water for the operations is sourced from the Blanket Dam that is situated on the Mtshabezi River and owned by the Zimbabwe National Water Authority (“ZINWA”). The use of this water is authorized through a contract agreement between Blanket Mine and ZINWA in terms of the Zimbabwe National Water Authority Act (Chapter 20:251).

The agreement is valid for one-year periods and is renewed annually. ZINWA sends the renewable agreement for signing to Blanket on an annual basis. Blanket continues to extract water in at a rate of USD $0.17/m3.

In accordance with paragraph 178(2)(a)(b)(c) of the MMA, the owners of claims possess the right to use of any surface within the boundaries for all necessary mining purposes; the right to use, free of charge, soil, waste rock or indigenous grass situated within the claims boundaries for all necessary mining purposes; and the right to sell or dispose of recovered waste rock. The MMA Amendment Bill makes instruction for landowner compensation in case of land loss due to mining activities in the form of land reallocation or outright purchase. The activities of the Company have not triggered this compensation.

The Indigenization and Economic Empowerment Act, which was enacted in 2007, required that 51% of the equity of all commercial enterprises in Zimbabwe must be owned by indigenous Zimbabweans. Following the implementation of indigenization, Caledonia received the Certificate of Compliance from the Government of Zimbabwe which confirmed that Blanket was fully compliant with the Indigenization and Economic Empowerment Act. The requirement for gold mining companies to be indigenized was removed by a change in legislation with effect from March 2018. A 36% share of Blanket is currently held by indigenous parties.

In Zimbabwean mining legislation, an Environmental Impact Assessment (“EIA”) is not required in order to issue a mining license, and in terms of the EM Act and its First Schedule is only required prior to commencement of mining and forms part of the planning process. Blanket Mine was established in the early 1900s, long prior to the implementation of governing mining and environmental laws. As such, it appears that an EIA is not required for the Blanket Mine. However, the Company is in constant communication with the Environmental Management Agency (“EMA”) regarding environmental permitting requirements and an EIA was completed for the Mine in 1995. Should the EMA communicate that an EIA certificate for the Mine be obtained, the Company will submit all relevant and associated applications to obtain such and remain fully compliant.

Blanket Mine holds EIA certificates as issued by the EMA for the solar plant, both the old and new TSFs. The new TSF is currently operating under the authorisation granted through the approval of the Environmental Impact Assessment, and a licence will be issued by the Zimbabwean EMA.

In order for operations to continue, the EMA has issued a number of additional environmental licences to Blanket as listed in the table below. The certificates are valid for 1 year and renewed annually. Applications for hazardous waste generation (oils, chemicals, etc.) licences have been submitted and are pending EMA review. New environmental disturbances will require additional permits further to those listed below, and currently no further disturbances have been identified.

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Environmental Permits

In order for operations to continue, the EMA has issued a number of additional environmental licences to Blanket, including:

● | five for air emissions (clinic incinerator, blacksmith shop, laboratory, smelter house and power plant generators);
● | four for solid waste (landfill and tailings);
● | three for effluent disposal (sewerage and car wash bay);
● | three for hazardous substances (importation, transportation and storage); and
● | one for hazardous waste generation (oils and clinical waste).

Geological Setting, Mineralization and Deposit

The Blanket Mine is situated on the north-western limb of the Archaean Gwanda Greenstone Belt. Several other gold deposits are situated along the same general strike as the mine. Approximately 268 mines operated in this greenstone belt at one stage; however, the Blanket Mine is one of the few remaining operational mines. At Blanket Mine, the rock units strike north−south, and generally dip steeply to the west.

The local geology consists of the Felsic Unit made up of, largely, quartz and quartz-sericite schists overlain by the Mafic Unit. The lower zone of the Mafic Unit comprises ultramafic and banded iron formations which host the orebodies of the Vubachikwe mine, that is located south of Blanket Mine. The upper zone of the Mafic Unit is made up of massive to pillowed basaltic lavas with intercalations of interflow sediments now showing as cherty argillites (locally commonly referred to as Black Markers) and this hosts the Blanket Mine complex orebodies. The Blanket Mine orebodies are in an orogenic setting with hydrothermal mineralization hosted in selected shears of country basaltic metavolcanics. This package is intruded by a younger and seemingly barren olivine-gabbro sheet. The sequence is capped by an Intermediate Unit comprising andesitic lavas with amphibole feldspar schists.

The generalized stratigraphic column for the area is shown below.

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The Blanket Mine complex orebodies together with those of the Vubachikwe complex comprise the north-western Mining Camp, also called the Sabiwa group of mines. Blanket Mine complex is a cluster of deposits that extend from Jethro in the south, through Blanket Mine, Feudal, AR South, AR Main, Sheet, Eroica and Lima to the north.

The local geology at Blanket Mine is depicted below including the infrastructure locations.

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The Long Section of Blanket Mine showing Stopes, Drives, Haulages and Shafts is shown below.

In greenstone belts, gold mineralization occurs mainly as vein type or shear zone hosted disseminations. Most of the larger deposits are found within the greenstone belts or their contacts with the granitoids. All mineralization is hydrothermally emplaced and associated with the regionally developed D2 deformation characterised (at the Blanket Mine) by areas of high strain wrapping around relatively undeformed remnants of the original basaltic flows. It is within the more ductile tensional high strain areas that the wider of the orebodies are located.

These orogenic gold deposits are commonly associated with late syntectonic intermediate to felsic magmatism. Vein systems occur as a system of echelon veins on all scales. The Blanket mineralization is hydrothermally emplaced and associated with the regionally developed D2 deformation characterised by areas of high strain wrapping around relatively undeformed remnants of the original basaltic flows. Wider orebodies occur within the more ductile tensional high strain areas. The localisation of the mineralised shears conforms to a Riedel pattern.

Two main types of mineralization are recognized at Blanket Mine, namely disseminated sulphide reefs (“DSR”) and quartz-filled reefs and shears. A third type of mineralization may be evidenced in the form of auriferous sulphide minerals as a replacement of the iron-rich minerals along the hinges of the folds in BIF, as is present at the neighboring Vubachikwe Mine.

Disseminated Sulphide Replacement Reefs

DSRs host the best grades and comprise the majority of the ore shoots. The zones have a silicified core with finely-disseminated arsenopyrite. Relatively high grades are found in a package of silicified biotite chlorite schist with irregular quartz stringers and disseminated and stringer arsenopyrite in the fabric planes. Due to lesser silicification, abundant biotite characterizes the margins of these mineralized zones and as a result they have a lower gold content. Disseminated sulphide-replacement orebodies range up to 50 m in width with a strike of 60 m to 90 m. Free-milling gold constitutes up to 50% of the total metal content with the remainder locked in the arsenopyrite. The ore is not refractory despite its association with arsenopyrite. Generally, plant recoveries of 85% to 90% are achieved.

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Quartz-Filled Reefs and Shears

Two quartz shears are mined at the Blanket Mine, namely the BQR and the Eroica Reef. These reefs have long strikes; however, they are not uniformly mineralized. Continuous pay shoots of over 100 m on strike are present. The Quartz Reef has a surface strike of approximately 500 m, but economic mineralization is restricted to three 90 m long shoots.

Quartz-filled reefs display a much wider grade range compared to the DSR deposits. On average, these shears are of a higher grade and are used in blending the ore to the mill. Dominant ore minerals are native gold and galena although arsenopyrite becomes more prevalent below 470 m. Increasing levels of arsenopyrite association with depth confirm that the quartz shears represent higher level offshoots and splays with brittle deformation relative to the more ductile DSR-type core zone mineralized bodies.

Mineral Resource and Mineral Reserve Estimates

The mineral resources reported here are estimated by the QP as at December 31, 2023 and presented in other disclosures and utilised for the updated 2023 mineral reserve estimation. The QP has updated the mineral resource estimate based on the incorporation of significant new drilling data obtained for Blanket Mine. Refer to Exhibit 15.4 or the technical report summary titled “S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe”, with an effective date of December 31, 2023, for key assumptions, parameters, and methods used to estimate the mineral resources and risks that could materially affect the mineral resource.

The measured and indicated mineral resource estimates for 2023 are reported in compliance with Subpart 1300, in situ as at December 31, 2023 and exclusive of mineral reserves.

Mineral Resource Classification | Orebody | Tonnes | Au Grade | Au Content
|  | Kt | g/t | Koz
| ARM | 653 | 3.12 | 66
| ARS | 329 | 3.70 | 39
| ARS_Ext | 11 | 1.83 | 1
| BF | 89 | 3.58 | 10
| BLK1 | 136 | 3.74 | 16
Measured (2.5% Geological Loss) | BLK2 | 148 | 3.66 | 17
| BLK3 | 109 | 3.44 | 12
| BLK4_5 | 194 | 3.85 | 24
| BLK6 | 48 | 3.79 | 6
| BQR | 482 | 4.31 | 67
| ERC | 208 | 4.93 | 33
| Jethro | 53 | 3.11 | 5
| Lima | 151 | 3.64 | 18
| Sheet | 88 | 2.99 | 9
Measured Total | 2,700 | 3.72 | 323
| ARM | 475 | 2.68 | 41
| ARS | 337 | 3.13 | 34
| ARS_Ext | 50 | 2.31 | 4
| BF | 103 | 3.04 | 10
| BLK1 | 232 | 3.19 | 24
| BLK2 | 228 | 3.86 | 28
| BLK3 | 66 | 2.45 | 5
Indicated (5% Geological Loss) | BLK4_5 | 70 | 2.99 | 7
| BLK6 | 17 | 4.17 | 2
| BQR | 711 | 3.45 | 79
| ERC | 144 | 4.69 | 22
| Jethro | 177 | 2.82 | 16
| Lima | 74 | 3.44 | 8
| Sheet | 41 | 2.60 | 3
Indicated Total | 2,726 | 3.23 | 283
Measured + Indicated Total | 5,426 | 3.47 | 606

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Notes:

1. | Cut-off applied 1.5 g/t.
2. | Geological loss applied: Measured 2.5%, Indicated 5%, Inferred 10%.
3. | Commodity price utilised: USD2,150/oz
4. | Mineral resources are stated exclusive of mineral reserves.
5. | Mineral resources are reported as 64% attributable to Caledonia.
6. | All orebodies are depleted for mining.
7. | Plant recovery factor of 94% applied.

In situ inferred mineral resource tabulation for Blanket Mine as at December 31, 2023:

Mineral Resource Classification | Orebody | Tonnes | Au Grade | Au Content
|  | Kt | g/t | Koz
| ARM | 299 | 2.87 | 28
| ARS | 170 | 3.88 | 21
| ARS_Ext | 68 | 3.48 | 8
| BF | 150 | 3.05 | 15
| BLK1 | 871 | 3.20 | 90
| BLK2 | 584 | 4.91 | 92
| BLK3 | 73 | 3.33 | 8
Inferred (10% Geological Loss) | BLK4_5 | 269 | 3.32 | 29
| BLK6 | 83 | 3.57 | 10
| BQR | 1,900 | 3.71 | 227
| ERC | 928 | 4.30 | 128
| Jethro | 108 | 3.28 | 11
| Lima | 95 | 3.41 | 10
| Sheet | 47 | 2.52 | 4
Inferred Total | 5,646 | 3.74 | 679

Notes:

1. | Cut-off applied 1.5 g/t.
2. | Geological loss applied: Measured 2.5%, Indicated 5%, Inferred 10%.
3. | Commodity price utilised: USD2,150/oz.
4. | Mineral resources are stated exclusive of mineral reserves.
5. | Mineral resources are reported as 64% attributable to Caledonia.
6. | All orebodies are depleted for mining.
7. | Plant recovery factor of 94% applied.

A comparison of the measured, indicated and inferred mineral resource estimates as at 31 December 2023 with those of 31 December 2022 are shown below. The most significant reasons for the changes are as a result of:

● | Updates to domain orebody wireframes due to the deep drilling and short hole drilling campaigns, additional sampling information; and continuous geological modelling.
● | 57,465 sampling data points added since the 2022 estimates (32% increase).
● | Geological losses of 2.5% applied to 2023 measured mineral resource estimate (2022: 0%), 5.0% applied to indicated mineral resource estimate (2022: 5.0%) and 10.0% applied to inferred mineral resource estimate (2022: 5%)

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● | The commodity price used was USD2,150/oz in 2023 and USD1,800 in 2022, with no change to the cut-off of 1.5g/t.
● | The inferred resources have diminished due to upgrading mineral resources to the indicated category.

| December 31, 2023 | December 31, 2022 | % Variance
Mineral Resource Classification | Tonnes | Au | Ounces | Tonnes | Au | Ounces | Tonnes | Au | Ounces
| kt | g/t | koz | kt | g/t | koz | kt | g/t | koz
Measured Total | 2,700 | 3.72 | 323 | 1,855 | 3.10 | 185 | 45% | 20% | 74%
Indicated Total | 2,726 | 3.23 | 283 | 2,363 | 2.89 | 220 | 15% | 12% | 29%
M&I Total | 5,426 | 3.47 | 606 | 4,218 | 2.98 | 405 | 29% | 16% | 50%
Inferred Total | 5,646 | 3.74 | 679 | 5,748 | 2.92 | 539 | -2% | -28% | 26%
Grand total | 11,071 | 3.61 | 1,285 | 9,967 | 2.94 | 944 | 11% | 23% | 36%

Notes:

1. | Cut-off applied 1.5 g/t .
2. | 2022 - No geological loss applied for measured, 5% for indicated and inferred
3. | 2023 – Measured 2.5%, Indicated 5%, Inferred 10%
4. | 2022 - Commodity price of $1,800/oz
5. | 2023 – Commodity price of $2,150/oz
6. | Mineral resources are reported as 64% attributable to Caledonia
7. | All orebodies are depleted for mining.
8. | Mineral resources are stated exclusive of Mineral Reserves.
9. | Plant recovery factor of 94% applied.

Refer to Exhibit 15.4 or the technical report summary titled “S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe”, with an effective date of December 31, 2023 for further key assumptions, parameters, and methods giving rise to the changes above.

Mineral reserve estimates in this Annual Report are reported in accordance with the requirements of Subpart 1300. Accordingly mineral resources in the measured and indicated categories have been converted to proven and probable mineral reserves respectively, by applying applicable modifying factors and are planned to be mined out under the life of mine plan within the period of our existing rights to mine, or within the time period of assured renewal periods of our rights to mine.

In addition, as of the date of this Annual Report, all mineral reserves are covered by required permits and governmental approvals. The updated mineral reserve estimation as of December 31, 2023, is detailed in the table below. Mineral reserves are stated as delivered to plant.

Mineral Reserve Classification | Tonnes | Grade | Au Content
| Kt | g/t | Kg | Koz
Proven | 1,363 | 3.21 | 4,377 | 141
Probable | 3,555 | 3.31 | 11,782 | 379
Total | 4,918 | 3.29 | 16,158 | 519

Notes:

1. | Mineral reserve cut-off of 2.1 g/t applied.
2. | The gold price that has been utilised in the economic analysis (as included in the S-K 1300 Technical Report Summary on the Blanket Gold Mine (refer to Exhibit 15.4) to convert diluted measured and indicated mineral resources in the life of mine plan to mineral reserves is an average real term price of USD1,877/oz over the life of mine, using the forecast prices as per economic analysis included in the S-K 1300 Technical Report
3. | Metallurgical recovery of 94% applied.
4. | The mineral reserve estimation utilises the 2023 mineral resource with the December 31, 2023 mine design and life of mine plan.
5. | Mineral reserves are reported as 64% attributable to Caledonia.

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An uneconomical tail containing 212.5 koz of gold has been excluded from the mineral reserve, since it is not economical on its own.

The mineral reserves for the estimate as of 31 December 2023 compared with that of 31 December 2022 is presented below.

| December 31, 2023 | December 31, 2022 | % Variance
Mineral Reserve Classification | Tonnes | Grade | Au Content | Tonnes | Grade | Au Content | Tonnes | Grade | Au Content
| kt | g/t | kg | oz | kt | g/t | kg | oz | kt | g/t | kg | oz
Proven | 1,363 | 3.21 | 4,377 | 141 | 1,191 | 3.23 | 3,842 | 124 | 14% | -1% | 14% | 14%
Probable | 3,555 | 3.31 | 11,782 | 379 | 1,300 | 2.92 | 3,801 | 122 | 173% | 13% | 211% | 211%
Total | 4,918 | 3.29 | 16,158 | 519 | 2,491 | 3.07 | 7,643 | 246 | 97% | 7% | 111% | 111%

On a total mineral reserve basis, there is a material change in the estimates. The reason for this is as follows:

● | The results of ongoing deep exploration drilling at Blanket has resulted in a substantial amount of previously inferred mineral resources being converted to indicated mineral resources, while maintaining similar levels of inferred mineral resources. On mine drilling has targeted previously indicated or inferred mineral resources in proximity to current mine workings and drilled this to increase the confidence levels.
● | Results of the long hole exploration drilling, published on July 10, 2023 and January 30, 2024, intersected wider orebodies with better grade than initially expected. These expectations were derived from the 2022 resource modelling as targets for the drilling programs.

Refer to Exhibit 15.4 or the technical report summary titled “S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe”, with an effective date of December 31, 2023 for key assumptions, parameters, and methods used to estimate the mineral reserves and risks that could materially affect the potential development of the mineral reserves.

Our mineral reserve figures are estimates, which may not reflect actual reserves or future production. These figures are prepared in accordance with industry practice, converting mineral deposits to reserves through the preparation of a mining plan. The mineral reserve estimates contained herein inherently include a degree of uncertainty and depend to some extent on statistical inferences. Reserve estimates require revisions based on actual production experience or new information. Should we encounter mineralization or formations different from those predicted by past drilling, sampling and similar examinations, mineral reserve estimates may have to be adjusted and mining plans may have to be altered in a way that might adversely affect our operations. Moreover, if the price of gold declines, stabilizes at a price that is lower than break-even level, if our production costs increase or recovery rates decrease, it may become uneconomical to recover mineral reserves with lower grades of mineralization.

Exploration and Planned Work

The Blanket Mine is a producing operation. Ordinarily, exploration activities are carried out both on and off the mine. Mine exploration takes place mostly underground on the producing claims and is aimed at expanding the lateral and depth extension of the known ore bodies which are being mined, as well as searching for potential additional orebodies.

The ongoing underground drilling program at Blanket targeted the Eroica, Blanket and AR south ore bodies and has yielded encouraging results which were published on July 10, 2023 and January 30, 2024. Total drilling for 2023 was 13,280 metres and the results indicate that the existing Blanket, Eroica and AR South ore bodies have grades and widths which are generally better than expected.

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The appropriate QAQC procedures were applied to satisfy best practice guidelines including the use of blanks, standards and duplicates. These procedures with respect to sample preparation, analyses, security and data validation and verification are detailed in Exhibit 15.4 titled “S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe”, with an effective date of December 31, 2023.

Bilboes

Property Description and Ownership

Bilboes owns three groups of claims that consists of four open pit mining properties in Matabeleland North Province of Zimbabwe. These open pits are referred to as Isabela North; Isabela South; McCays and Bubi (“Isabella McCays-Bubi”), as shown in the location map below. The first three are situated 80 km due north of Bulawayo whilst Bubi is 100 km due north east of Bulawayo and about 32 km northeast of Isabella. The Isabella McCays-Bubi properties comprise 131 claim blocks covering an area of 3,114.7 ha. A summary for each of the three groups of claims is contained in the table below. Additional ground is held at When, Sandy, Eastnor and Ferroro (3,935 ha). Collectively, these properties are referred to as the Bilboes Project.

The Bilboes Project is considered a development stage property because the company has identified a Subpart 1300 mineral reserve, but has not commenced material extraction. Caledonia acquired the Bilboes Project on January 6, 2023 by issuing shares to the value of $65.7 million. As at December 31, 2023, the net assets of the Bilboes Project is $73.6 million.

Location Map of Bilboes Properties

Source: DRA Projects (Pty) Ltd

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Bilboes claims:

Group of Claims | Mining District | Province | No. of Blocks | Area (ha) | Coordinate X1 | Coordinate Y1
Calcite and Kerry (Isabella Mine) | Bulawayo | Matabeleland North | 49 | 1,894.4 | 662,106 | 7,846,712
Ruswayi (McCays Mine) | Bulawayo | Matabeleland North | 3 | 330 | 666,339 | 7,849,975
Chikosi (Bubi Mine) | Bulawayo | Matabeleland North | 48 | 507.2 | 684,838 | 7,865,515
Total | 130 | 2,731.6 |  |

Isabella McCays-Bubi are approximately 80 km and 100 km directly north and north east of Bulawayo, the second largest city of Zimbabwe with an approximate population of 655,675 (2013). All the mines are accessed via public roads and although these are of variable quality, they are accessible by all types of vehicles. Isabella is 110 km (1.5 hours) whilst Bubi is 140 km (2 hours) by road from Bulawayo. Bubi can also be accessed by road from Isabella (70 km in 1 hour).

Average daily temperatures range from 24°C in June to 32°C in October and apart from the occasional heavy downpour in the rainy season, there are no climatic conditions that prevent all year-round exploration and mining.

The properties lie between 1,150 m and 1,200 m above sea level and are covered by red and grey soils of the greenstone rocks in the area. The area is generally flat and covered by woodland interspersed with scrubby vegetation. Agricultural activities are mainly small-scale ranching.

History

Anglo American Corporation of Zimbabwe Ltd (“AMZIM”), a company that formed Bilboes Holdings, held the Isabella, McCays and Bubi claims. AMZIM acquired the Isabella claims in 1982.

Initial exploration allowed the estimation of a small oxide resource and an open-pit; a heap leach mine was commissioned in 1989. Subsequent exploration extended Isabella and new discoveries were made at Bubi and McCays, which yielded 8,592 kg of gold (276,256 oz) over the past 26 years, 78,497 oz of this being produced since the management buyout of Bilboes Holdings in 2003. All mining has been from open pit oxide ore utilizing the heap leach extraction processing method.

Exploration for sulphide mineral resources began in 1994/95, with a sum of 17,650 m of exploratory drilling being completed by 1999, covering a strike length of 3,440 m. A maiden mineral resource estimate for the sulphide mineral resources was completed by SRK Consulting in 2009.

On January 6, 2023 Caledonia announced that it had satisfied the conditions precedent to purchase Bilboes Gold.

The table below indicates the aggregate annual production from Bilboes in the last three fiscal years on a 100% project basis:

Bilboes Production Statistics
Year | Tonnes Milled (t) | Gold Head (Feed) Grade (g/t Au) | Gold Recovery (%) | Gold Produced (oz)
2021 | - | - | - | -
2022 | - | - | - | -
2023 | 154,054 | 1.15 | 54.0 | 3,050

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Present Conditions and Infrastructure

The overall site plan is shown in the figure below (“Overall site plan”) and includes major facilities of the Project including the Isabella North and South, McCays and Bubi open pit mines, gold processing plan, TSF, Waste Stockpiles, demarcated areas for mine buildings and accommodation facilities, main power line internal mine roads and access public roads.

Grid power will be supplied from the Zimbabwe National Grid by constructing a 70 km 132 kV Lynx line from Shangani Substation. To feed the line, a line bay will be constructed at Shangani. A mine substation will be constructed at Isabella. The estimate received is for a 132kV substation, equipped with a 50 MVA 132/33 kV step-down transformer.

Raw water will be provided from open pit dewatering and the wellfield boreholes located across the mine license area.

Overall site plan

Source: DRA Projects (Pty) Ltd

Permitting, Licenses and Encumbrances

Bilboes is compliant in terms of authorizations and adheres to all government protocols and regulations as required.

Bilboes has been operating in Matabeleland since 1989. It holds the necessary mining permits and complies with the terms of the Mines and Minerals Act and allied regulations with respect to all of their claims and in particular that all of the registration certificates are valid, and the protection certificates are up to date. Bilboes thus requires no further permits to explore or produce from the current operational areas, but further permits will be required for the proposed haul road between Bubi and Isabella plant.

Further exploration outside the current claims will require approvals by the EMA who may request an EIA study.

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SLR Consulting based in South Africa in partnership with the local GryinOva Environmental Consultants conducted an ESIA study for the project and an EIA certificate of approval was issued by EMA in February 2021 and the certificate was valid for 2 years and subject to renewal on an annual basis for the duration of the operations. The current EIA certificate expires in March 202554. The conditions of renewal are notification to the agency of any changes in the project, compliance to the approved environmental plan and submission of progress report on the project. There is no reason that the renewal will not be granted.

Bilboes also hold 3,935 ha of additional claims and 51,900 ha of exploration licenses referred to as Exclusive Prospecting Orders (EPOs) around Isabella-McCays-Bubi and the Gweru area. These claims and EPOs have highly prospective targets which offer Bilboes excellent prospects for organic growth. The company has applied for an extension of the EPOs tenure for a further 3 years after the initial 3-year tenure expired in July 2021. The decision on the EPO applications is pending.

Geological setting, Mineralization and Deposit

The Bubi Greenstone Belt covering the Bilboes Properties consists of volcanic rocks of the Upper Bulawayan Group capped by sedimentary sequences of the Shamvaian Group locally represented by Mdutjana and Dagmar Formations respectively as shown in the figure below (“Regional Geological Map showing Bilboes Properties”). The deposits occur within the meta-volcanic and meta-sediments close to the contact between these two stratigraphic units.

Regional Geological Map showing Bilboes Properties

Source: Ngilazi and Martin ’17

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Stratigraphy

The Bilboes stratigraphic presentation is depicted in the figure below:

Bilboes Site Stratigraphy

Deposit Types

Mineralization at Bilboes’ four properties are Archaean lode, structurally controlled deposits. It consists of silicified stock-works/veins. The veins comprise pyrite and arsenopyrite. Gold is disseminated within the sulfide mineralization and is refractory. The mineralized zones are often subparallel to each other and are hosted in a much broader shear zone. The best mineralized zones are associated with brecciation and silicification.

Mineral Resource and Mineral Reserve Estimates

The mineral resources reported here are estimated by the QP as at December 31, 2023 and presented in other disclosures and utilised for the updated 2023 mineral reserve estimation. Refer to Exhibit 15.6 or the technical report summary titled “Bilboes Gold Project Technical Report Summary”, with an effective date of December 31, 2023, for key assumptions, parameters, and methods used to estimate the mineral resources and risks that could materially affect the mineral resource.

The measured and indicated mineral resource estimates for 2023 are reported in compliance with Subpart 1300, in situ as at December 31, 2023 and exclusive of mineral reserves.

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Mineral Resource | Orebody | Tonnes | Au Grade | Au Content
Classification |  | Kt | g/t | Koz
| Isabella South | 34 | 1.80 | 2
Measured | Isabella North | 82 | 2.40 | 6
| Bubi | 59 | 1.22 | 2
| McKays | 66 | 1.77 | 4
Measured Total | 241 | 1.85 | 14
| Isabella South | 1,043 | 2.07 | 69
Indicated | Isabella North | 1,734 | 2.29 | 127
| Bubi | 4,437 | 1.51 | 215
| McKays | 1,261 | 1.85 | 75
Indicated Total | 8,475 | 1.79 | 487
Measured + Indicated Total | 8,716 | 1.79 | 502

Notes:

1. | S-K 1300 definitions observed for classification of Mineral Resources.
2. | Mineral Resources are reported exclusive of Mineral Reserves
3. | Block bulk density interpolated from specific gravity measurements taken from core samples.
4. | Resources are constrained by a Lerchs-Grossman (LG) optimized pit shell using Whittle software at a gold price of US$2,400/oz and a 0.9 g/t cut-off grade.
5. | Mineral Resources are not Mineral Reserves and have no demonstrated economic viability. The estimate of Mineral Resources may be materially affected by mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social, and governmental factors (Modifying Factors).
6. | Numbers may not add due to rounding.
7. | The Mineral Resource Estimate has been depleted to reflect mining up to 31 December 2023
8. | Effective Date of Resource Estimate is 31 December 2023.

Mineral Resource Classification | Orebody | Tonnes | Au Grade | Au Content
|  | Kt | g/t | Koz
| Isabella South | 1,335 | 1.80 | 77
Inferred | Isabella North | 1,613 | 2.18 | 113
| Bubi | 5,116 | 1.80 | 296
| McKays | 1,054 | 2.16 | 73
Inferred Total | 9,118 | 1.91 | 559

Notes:

1. | S-K 1300 definitions observed for classification of Mineral Resources.
2. | Mineral Resources are reported exclusive of Mineral Reserves
3. | Block bulk density interpolated from specific gravity measurements taken from core samples.
4. | Resources are constrained by a Lerchs-Grossman (LG) optimized pit shell using Whittle software at a gold price of US$2,400/oz and a 0.9 g/t cut-off grade.
5. | Mineral Resources are not Mineral Reserves and have no demonstrated economic viability. The estimate of Mineral Resources may be materially affected by mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social, and governmental factors (Modifying Factors).
6. | Numbers may not add due to rounding.
7. | The Mineral Resource Estimate has been depleted to reflect mining up to 31 December 2023
8. | Effective Date of Resource Estimate is 31 December 2023.

No S-K 1300 compliant mineral resources had been identified at Bilboes as of the previous year end, December 31, 2022. Accordingly, the Company has omitted a comparison of the mineral resources between December 31, 2023 and 2022.

Mineral reserve estimates in this Annual Report are reported in accordance with the requirements of Subpart 1300. Accordingly mineral resources in the measured and indicated categories have been converted to proven and probable mineral reserves respectively, by applying applicable modifying factors and are planned to be mined out under the life of mine plan within the period of our existing rights to mine, or within the time period of assured renewal periods of our rights to mine. Mineral reserves are stated as delivered to plant.

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Mineral Reserve Classification | Tonnes | Grade | Au Content
| Mt | g/t | Kg | Koz
Proven | 5.9 | 2.42 | 14,152 | 455
Probable | 19.1 | 2.31 | 44,104 | 1,418
Total | 24.9 | 2.34 | 58,256 | 1,873

Notes:

1. | S-K 1300 definitions observed for classification of Mineral Reserves.
2. | All tonnes quoted are dry tonnes
3. | Mineral Reserves are reported fully diluted delivered to plant
4. | Mineral Reserves are reported as constrained by an optimal pit shell at a gold price of US$1,800/ox and a 0.9 g/t cut-off grade.
5. | 5% Ore loss and 4% dilution applied
6. | Gold recovery ranges between 83.62% to 88.88% dependent on mining area and ore type being processed
7. | Numbers may not add due to rounding.
8. | No metal equivalents are reported.
9. | Effective Date of Mineral Reserve Estimate is 31 December 2023.

No S-K 1300 compliant mineral reserves had been identified at Bilboes as of the previous year end, December 31, 2022. Accordingly, the Company has omitted a comparison of the mineral reserves between December 31, 2023 and 2022.

Exploration and Planned Work

Plans are commissioned to complete the Caledonia feasibility study on the Bilboes sulphide project to estimate the funding requirements and commence development of the sulphides project.

Maligreen

Property Description and Ownership

On September 23, 2021, Caledonia announced that it had entered into an agreement to purchase 100% ownership of mining claims over Maligreen, a property situated in the Gweru mining district in the Zimbabwe Midlands, for a total cash consideration of US$4 million. The claims were purchased to further explore and the exploration and evaluation asset is disclosed in note 17 of the Consolidated Financial Statements. No production activities have taken place while under the control of the Company. As at December 31, 2023, the exploration and evaluation cost, as included in note 17 of the Consolidated Financial Statements, is $6.0 million.

Maligreen is a brownfield gold exploration project situated on the Nkayi-Silobela Greenstone Belt that has historically been exploited via open pit mining. The Maligreen property is envisioned as a combination open pit and underground operation. Appropriate work has to be completed to determine the extent and economic viability of an underground operation. This will be informed by future exploration drilling.

Maligreen is located in central Zimbabwe, approximately 73 km due west-southwest of Kwekwe, Midlands Province. Zimbabwe's capital city, Harare, lies 235 km northeast of Maligreen. The town of Nkayi lies 25 km west of the project along the Kwekwe-Lupane Highway. The location of the project is indicated below.

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Source: Minxcon (2022)

Maligreen is centered on the following coordinates:

● | Latitude 19°1'51"S
● | Longitude 29°6'5"E

Maligreen is held under a portfolio of 41 adjacent mining claims in the Midlands Mining District. Of these, 40 encompass an area of 10 ha each and are issued for gold. Claim AMT 97 (claim number 11219BM) encompasses 150 ha and is issued for copper. This latter claim has not been the focus of exploration to date. Should future exploration reveal substantial gold mineralization, application will be made to include gold ore in the claim. The claims are all up to date, with next inspections due in 2023. The claims were all held in the name of Maligreen Mining Company (Pvt) Ltd, which entered into an Agreement of Sale with |CHZ on September 22, 2021 to acquire the claims.

The total land area of Maligreen is approximately 550 hectares comprising two historic open pit mining operations that produced approximately 20,000 ounces of gold mined from oxides between 2000 and 2002 after which the operation was closed. No exploration activities are currently active at the project, but the Company is planning to undertake additional exploration to fully understand the strike extension and depth extension potential.

History

The Maligreen deposit was discovered by Reunion Mining (Zimbabwe) Limited (“Reunion”) in October 1995 over a number of Exclusive Prospecting Orders. The property was purchased by Cluff Mineral Resources Limited (“Cluff”) in April 1998. In December 1999, Pan African (Pvt) Ltd (“Pan African”) entered into an agreement with Cluff to acquire a 50% interest in Maligreen. The acquisition was completed in April 2000 and a new joint-venture company MMC was registered (Trashliev, 2007).

As described by Trashliev (2007), four years of integrated regional geochemical and geophysical exploration led to the discovery of the Maligreen mineralization by Reunion in 1995. A north-south, 3.3 km long geochemical signature along structural targets was identified. For the next two and a half years, Reunion drilled 107 diamond drillholes over 28,272 m and 526 percussion drillholes over 29,110 m, the results of which were utilised to define a gold mineral resource. Only the southern 1 km of the geochemical anomaly has been drilled. Limited geochemical data is however available. The area has been mapped and geological data relogged. No further exploration work was undertaken under Cluff ownership, but the company did revise the mineral resources to quantify the potential and guide mine planning.

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Work commenced in January 2000 under MMC ownership to develop two open pits (North Pit and South Pit) to exploit the orebody. A crushing, sizing and floatation plant was also constructed. Pan African completed 35 reverse circulation (“RC”) drillholes over 1,038 m to guide mine planning at North Pit. The first bullion was poured in July 2000. All available data for the project area was consolidated in 2003 and all 107 diamond drillholes were relogged. Mining ceased in September 2002, but the reason for this is uncertain. It is however assumed that they were targeting the oxides only.

Present Condition and Infrastructure

Infrastructure on site is minimal. There are two open pits, namely North Pit and South Pit, that were historically mined, as well as the heap leach pad and possible elution room that serviced the operations. An office block is occupied and maintains the care and maintenance of the historic operation. A basic process plant is erected and utilised by the Syndicate for their mining activities. All required infrastructure for exploration activities is in place.

The Maligreen project is in the exploration phase and the area is accessible by car via the Kwekwe-Lupane Road, approximately 80 km west of Kwekwe. From this road, the Mahlathini Road can be taken southwards for some 3.8 km, from which point a westwards gravel road provides direct access to the project area after 1.8 km. The journey from Kwekwe takes approximately 2 hours by car.

Permitting, Licensing, and Encumbrances

The Maligreen mineral resource occurs within a claims area covering a total of 550 ha. The project is held under a portfolio of 41 adjacent mining claims in the Midlands Mining District. Of these, 40 encompass an area of 10 ha each and are issued for gold. Claim AMT 97 (claim number 11219BM) encompasses 150 ha and is issued for copper. A conversion application to convert Claim AMT 97 to gold was accepted and registered on August 5, 2022 by the office of the Provincial Mining Director, Gweru. The claims are all up to date, with next inspections due in 2023.

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Location of the existing claims are shown below.

Source: Minxcon (2022)

Caledonia Holdings Zimbabwe (Private) Limited is in possession of a Mining Lease No.44 over Silobela Communal Land (SR 67/2024), issued January 12, 2024 by the Mining Affairs Board following the gazette of the mining lease for objections on October 20, 2023. As per the Mines and Mineral bill, 2022 Section 137 (5) and (6), an approved plan of 110, 9903 ha (diagram GS No. 84/2024) was submitted and filled at the Surveyors General’s Office, dated April 24, 2024.

Geological Setting, Mineralization and Deposit

The Maligreen gold deposit occurs in a northeast-trending section of greenstone near the convergence (triple junction) of the Midlands, Bubi and Silobela greenstone belts. The Shangani granite-gneiss terrain occurs to the southeast of the project.

Although the area and its immediate surroundings are covered by a thin layer (0-40 m) of surface deposits that include Kalahari sands, the position of the area within the regional stratigraphy and structure can be deduced from aeromagnetic data linked to outcrops SW and NE of the area. On this basis it is assumed that the Maligreen deposit is hosted in rocks assigned to the Maliyami Formation of the Upper Bulawayan Group (Harrison, 1981).

Maliyami Formation rocks comprise andesitic lava flows that are locally amygdaloidal or porphyritic, and interbedded with basalt, volcaniclastic rocks (tuff, agglomerate, ignimbrite), felsic volcanic material and porphyry intrusions, as well as phyllitic rocks and chert. All units have been intruded by metadolerite and gabbro bodies (Harrison, 1981). To the southeast the Maliyami Formation rocks are assumed to stratigraphically overlie older rocks belonging to the Upper Bulawayan Group (Leo Hurst Formation andesitic and dacitic flows; Ntobe Formation basalt) and Lower Bulawayan and Sebakwean Groups (dacite and serpentinite). Contacts between most units are strongly sheared. The greenstone pile in the Maligreen area was intruded by a number of tonalitic bodies with narrow contact metamorphic aureoles, assigned to the Sesombi Suite.

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The regional structural trend around Maligreen is northeast, parallel to the contact between the greenstone pile and the Shangani granite-gneiss terrain to the southeast. Two major northeast trending shear zones have been described to the southeast of the project using Landsat TM data (Campbell and Pitfield, 1994). These shears are positioned near formational contacts between the Leo Hurst and Ntobe Formations (the Leo Hurst shear zone) and the Ntobe Formation and Lower Bulawayan rocks respectively. They have been interpreted as large dextral shear systems and linked to the Munyati Shear Zone in the Midlands Greenstone Belt (Campbell and Pitfield, 1994).

A stratigraphic column depicting the regional lithological units is provided in figure below.

Source: Minxcon (2022)

Numerous small gold workings occur in the area around Maligreen. Larger mines (>500 kg production) include the Jena Group of mines to the north-northeast of Maligreen and the Turtle Mine and associated reefs to the northwest.

The country rocks at Maligreen consist of metamorphosed andesitic pyroclastics (grading from lapilli tuff to agglomerate), intermediate lavas (dacite/andesite) and mafic lavas (basalt/gabbro). The pyroclastics are interbedded with quartz-eye-porphyry (“QEP”) and intruded by feldspar porphyry (“FP”) dykes. Andesitic volcanics are porphyritic and amygdaloidal in places. A mafic (“marker”) dyke has intruded along the contact between pyroclastics and dacitic volcanics, within a broad shear zone. The strongly altered and sheared zone known as the quartz-sericite-zone (“QSZ”), forms the core of deformation and alteration at Maligreen (Mtetwa, 2007).

The andesitic-dacitic lava is a fine to medium grained, grey green rock. Amygdaloidal and porphyroidal textures are found in places. Quartz-porphyry is characterised by sparse, whitish calcite (after feldspar) amygdales with rectangular (feldspar pseudomorph) shape, in fine grained siliceous matrix. Pyroclastics grade from very fine grained, grey green lapilli tuff to coarse grained agglomerates with large, usually felsic, bombs up to a few centimetres across. The bombs are often amygdaloidal. Quartz and carbonate veining is common. QEP is massive, brittle, grey green (seldom pink) rock with siliceous matrix and spheroidal quartz porphyroblasts, usually 2-3 mm across. It is sericitized and deformed into strongly developed S-C fabric and mineralised in places pressure shadows around the quartz porphyroblasts often indicate the sense of movement during deformation. QSZ is a strongly deformed and intensely altered unit composed of white quartz with yellow sericite and/or green chlorite bands usually forming S-C fabric along the chlorite/sericite bands. When the chlorite rather than sericite is dominant, it is called the quartz-chlorite-zone. Fuchsite and epidote are sometimes present.

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The mafic dyke has a green medium grained matrix with dark green hornblende phenocrysts up to 5mm across. It has chilled margins and is found within or on the margin of the QSZ. The FP is pale grey to pink felsic unit with white subhedral to euhedral feldspar phenocrysts up to 5mm across. It is often intensely sheared, altered (sericite after feldspar) and mineralised. The FP in the main shear zone, to the north, has QSZ xenoliths in it, suggesting that it is post Phase 1 deformation. In addition, the FP is often found unsheared within the QSZ. The same applies to the mafic dyke. Basalt is fine grained green to dark green and fairly brittle. It has black magnetite rich patches which are very magnetic. Patchy siliceous and epidote alteration associated with specks of pyrite is common. Dolerite is medium to coarse gained rock with a pale green matrix and dark green hornblende phenocrysts. It is weak to strongly magnetic. The gabbro has very pale green matrix with large dark green phenocrysts which give it a coarse-grained texture. Minor sericite alteration is found in places. Kalahari sands, Karoo sediments and black hydromorphic clays 3m to 7m thick cover the Maligreen deposit.

The low-grade greenschist facies metamorphism of the country rock is marked by the assemblage of chlorite-epidote-actinolite-plagioclase. Three different types of alteration are recognised. The first type of alteration is observed in the intensely sericitized and silicified QSZ and is related to the phase 1 deformation. Epidote and minor fuchsite are also present. Low temperature Na-micas (illite and paragonite) were picked up by Pima spectral analysis. The second type of alteration (related to phase 2 deformation) is found in gold mineralised zones, which are also intensely sericitized and silicified. Other alteration minerals present are carbonate, tourmaline, chlorite and leucoxene. Fuchsite and epidote are seldom present. The Pima spectral analysis on core from diamond drill hole MG45 suggests that gold mineralization is associated with K-mica (muscovite) introduced by “high” temperature hydrothermal fluids. The third type of alteration is pervasive silicification and carbonatization of the country rock. It has a bleaching effect on the wall rocks, forming a broad envelope to mineralization (Mtetwa, 2007). The alteration minerals are usually associated with shear zones and pyrite mineralization.

The deposit lies in a major north-south structure interpreted from the aeromagnetic data and observed in the core as the 50 m wide QSZ. This dominant structure (phase 1 deformation) is usually barren of gold. Narrow shears splay-off the QSZ (phase 2) deformation and are associated with gold mineralization. A NW oblique trend appears to belong to phase 2 deformation as it has brittle fractures and hosts grey sulphide with gold mineralization. Silicified ENE trending faults are barren of gold and are probably post mineralization.

Detailed mapping and structural measurements were taken by Professor Paul Dirks (2001).

The calculated stress field indicates that during the formation of the shear zones;

● | WNW and NW trending sinistral shears formed within a tensional field,
● | NE trending dextral shears formed in a compressional field,
● | N trending sinistral shears formed close to the boundary of the compressional and tensional fields.

This suggests that maximum fluid infiltration can be expected along the NW and WNW trending shears, and especially along the intersections of WNW, NW and N trending shears. The intensity of infiltration is partly dependent on the fluid pressure at the time of mineralization.

The widest zones of wall rock alteration in the South Pit occur in areas where NW, WNW and N shear zones merge into each other. Where such zones coincide with quartz porphyry rock, extensive stock works of quartz-sulphide veinlets have developed within the porphyry.

This is especially the case along the massive porphyry exposed at the bottom of the South Pit as indicated in the Local Geology of the Maligreen South Area figure below.

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N-S trending shears away from intersections with NW trending shears, and SW trending shears parallel to S1 show less alteration and are not associated with significant mineralization although a narrow mineralised zone can be traced along the main N-trending shear zone to the N of the pit.

It is clear that the main zones of fluid infiltration occur along the intersection points of N-, NW- and WNW-trending shears within a sinistral shear system. Within such a system, these areas are clearly dilatant allowing more effective fluid impregnation. The intersection lineation between the three shear zone sets plunges steeply to the south. This orientation is near parallel to the L1 mineral lineation, this suggests that the mineralization plunges steeply S to SSW.

Where fault intersections coincide with quartz porphyry rocks, better mineralization occurs. This appears to happen because, the porphyry undergoes extensive, stock-work like fracturing with associated sulphide impregnation, a feature not observed to be as well developed in other lithologies. All quartz porphyries in the South Pit contain S1 and therefore were emplaced before gold was introduced along the younger brittle-ductile shear zones. A direct genetic relationship between the porphyries and mineralization is therefore not expected.

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The feldspar porphyry observed in drill core below the N-pit intruded after the development of D1 and before or during the mineralising events in an N-S trend and may have a genetic relationship with the gold. The same may be true for the mafic dyke that has intruded into the main shear zone after D1, but before shearing associated with mineralization, which locally affects the dyke.

The figure below shows a schematic cross section of the geology at the project.

Source: Minxcon (2022)

Gold mineralization at Maligreen is generally associated with pyrite. Pyrite occurs mainly in association with argillic and quartz-sericite hydrothermal alteration and occasionally with propylitic and mylonitic style of hydrothermal alteration. Although the pyrite content increases towards the ore channel, gold and pyrite are not sympathetically related. Both stockwork and breccia pipe-type mineralization have been recognised. The breccia type is very limited and consists of rock fragments cemented with silicates and ore minerals.

Pyrite generally occurs as fracture filling, or as vein, veinlets, and dissemination. Dissemination of pyrite with visible fractures and healed micro cracks implies that some of the mineralization is a result of wall rock alteration by permeating fluids.

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Based on the textural appearance, early clean pyrite and late “dirty” pyrite are the two dominant pyrite at Maligreen. The dirty pyrite is most likely “contaminated” by abundant magnetite due to the superimposed deep argillic alteration. However, the black colour could also be a result of the presence of molybdenite, arsenopyrite or sphalerite. Nevertheless, it is believed that the dirty pyrite is a result of late supergene enrichment due to the pervasive argillic alteration marked by the introduction of clay and magnetite (Mtetwa, 2007).

The relative proportion of dirty pyrite and clean pyrite varies significantly, but total pyrite content within the ore zones can reach 20-25%. Pyritised zones within the pyroclastic unit show clean pyrite as veins and veinlets which are always parallel to the bedding of the bedded tuff. Some of them are auriferous but generally do not show extreme grades. This could represent the formation of an early exhalative mineralization (Mtetwa, 2007).

The possible mechanism for the Maligreen gold deposition is likely a fluid flow, aided and abetted by high level rhyolitic intrusions, and redistributed through permeable secondary shear zones due to late dextral duplex-like segmentation.

Mineral Resources Estimate

Refer to Exhibit 15.5 or the technical report summary titled “S-K 1300 Technical Report Summary on the Maligreen Gold Project, Zimbabwe”, with an effective date of December 31, 2022, for key assumptions, parameters, and methods used to estimate the mineral resources and risks that could materially affect the mineral resource. This technical report summary estimated the mineral resources at the Maligreen Gold Project as at December 31, 2022. Qualified Person Uwe Engelmann has confirmed that there was no change in the mineral resource estimate between December 31, 2022 and December 31, 2023.

The mineral resources have been depleted by means of the topography and mining voids. Discounts applied to the mineral resources include geological losses of 5% for Measured, 10% for Indicated and 15% for Inferred mineral resources to account for geological, data as well as estimation uncertainty. The gold content conversion calculations utilise a conversion of 1 kg = 32.15076 oz and all tonnages are reported in metric tonnes. Inferred mineral resources have a low level of confidence and while it would be reasonable to expect that the majority of Inferred mineral resources would upgrade to Indicated mineral resources with continued exploration, due to the uncertainty of Inferred mineral resources, it should not be assumed that such upgrading will occur.

The mineral resources are declared as the portion of the Resource that is potentially mineable from open pit as well as from underground, as part of the reasonable prospects for eventual economic extraction. An optimised pit was generated to evaluate the depth to which surface mining could occur. Based on this analysis a depth of 220 m was defined as the level to which surface mining can occur and is reported at a 0.4 g/t cut-off (Table: Surface Mineral Resource for Maligreen Gold Mine as at December 31, 2023). Below this all mineral resources are declared as underground, with a 1.5 g/t cut-off.

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Surface Mineral Resource Tabulation for Maligreen as at December 31, 2023.

Domain | Mineral Resource Category | Tonnes (Less Geological Losses) | Gold Grade | Gold Content
|  | Mt | g/t | koz
| Measured | 0.30 | 0.87 | 8.3
North | Indicated | 3.01 | 1.38 | 133.1
| Total Measured and Indicated | 3.30 | 1.33 | 141.4
| Inferred | 1.01 | 1.09 | 35.5
| Measured | 1.35 | 2.70 | 117.2
South | Indicated | 0.75 | 4.17 | 101.9
| Total Measured and Indicated | 2.10 | 3.23 | 218.2
| Inferred | 0.49 | 6.05 | 95.3
| Indicated | 1.68 | 0.80 | 43.1
SplayNW | Total Measured and Indicated | 1.68 | 0.80 | 43.1
| Inferred | 2.08 | 0.81 | 54.0
| Indicated | 0.85 | 1.15 | 31.4
SplaySW | Total Measured and Indicated | 0.85 | 1.15 | 31.4
| Inferred | 1.00 | 1.37 | 44.0
Total Measured and Indicated | 7.94 | 1.70 | 434.1
Total Inferred | 4.58 | 1.55 | 228.8

Notes:

1. | Mineral resource Cut-off of 0.4 g/t Au applied.
2. | A gold price of USD1,800/oz was used for the cut-offs.
3. | Columns may not add up due to rounding.
4. | Mineral resources are reported as total Mineral resources and 100% attributable to Caledonia.
5. | Plant recovery factor of 80% applied.

Underground Mineral Resource Tabulation for Maligreen as at December 31, 2023.

Domain | Mineral Resource Category | Tonnes (Less Geological Losses) | Gold Grade | Gold Content
|  | Mt | g/t | koz
| Indicated | 0.09 | 2.88 | 8.2
North | Total Measured and Indicated | 0.09 | 2.88 | 8.2
| Inferred | 1.13 | 2.42 | 87.7
| Indicated | 0.00 | 12.57 | 0.0
South | Total Measured and Indicated | 0.00 | 12.57 | 0.0
| Inferred | 0.33 | 8.69 | 93.5
SplayNW | Inferred | 0.13 | 2.51 | 10.3
SplaySW | Inferred | 0.00 | 1.58 | 0.0
Total Measured and Indicated | 0.09 | 2.89 | 8.2
Total Inferred | 1.59 | 3.75 | 191.5

Notes:

1. | Mineral resource Cut-off of 1.5 g/t Au applied.
2. | A gold price of USD1,800/oz was used for the cut-offs.
3. | Columns may not add up due to rounding.
4. | Mineral resources are reported as total mineral resources and 100% attributable to Caledonia.
5. | Plant recovery factor of 80% applied.

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The combined surface and underground mineral resource is shown in the below table, this shown at 0.4 g/t and 1.5 g/t for surface and underground respectively.

Total Mineral Resource Tabulation for Maligreen as at December 31, 2023.

Domain | Mineral Resource Category | Tonnes (Less Geological Losses) | Gold Grade | Gold Content
|  | Mt | g/t | koz
| Measured | 0.30 | 0.87 | 8.3
North | Indicated | 3.09 | 1.42 | 141.3
| Total Measured and Indicated | 3.39 | 1.37 | 149.6
| Inferred | 2.14 | 1.79 | 123.2
| Measured | 1.35 | 2.70 | 117.2
South | Indicated | 0.75 | 4.17 | 101.0
| Total Measured and Indicated | 2.10 | 3.23 | 218.2
| Inferred | 0.82 | 7.12 | 188.8
SplayNW | Indicated | 1.68 | 0.80 | 43.1
| Total Measured and Indicated | 1.68 | 0.80 | 43.1
| Inferred | 2.21 | 0.91 | 64.3
SplaySW | Indicated | 0.85 | 1.15 | 31.4
| Total Measured and Indicated | 0.85 | 1.15 | 31.4
| Inferred | 1.00 | 1.37 | 44.0
Total Measured | 1.65 | 2.37 | 125.5
Total Indicated | 6.37 | 1.55 | 316.8
Total Measured and Indicated | 8.03 | 1.71 | 442.3
Total Inferred | 6.17 | 2.12 | 420.3

Notes:

1. | Mineral resource Cut-off of 0.4 g/t Au for surface and 1.5 g/t Au for underground applied.
2. | A gold price of USD1,800/oz was used for the cut-offs.
3. | Columns may not add up due to rounding.
4. | Mineral resources are reported as total mineral resources and 100% attributable to Caledonia.
5. | Plant recovery factor of 80% applied.

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Exploration and Planned Work

There has been no further exploration activities at the Maligreen property during 2023.

Any future work will be conducted in line with QAQC protocols as described in the Technical Report Summary for Maligreen, Exhibit 15.5.

Motapa

Property Description and Ownership

The Motapa project is an exploration stage project at which no Subpart 1300 mineral reserves or mineral resources have been identified. The registered mining lease held by Arraskar (the “Motapa Mining Lease”) covers an area of 2,224 ha located in a brownfield exploration and mining area in the Inkosikazi resettlement area, Matabeleland North. The Motapa Mining Lease covers a geological strike close to 5 km. Motapa is accessed by wide tar road from Bulawayo for the first 40 km followed by a poorly maintained narrow-width tarred section for 65 km. An extensive gravel road network links various sites at the Motapa Mining Lease area. As at December 31, 2023, the exploration and evaluation cost of the Motapa project was $10.6 million. Refer to note 17 of the Consolidated Financial Statements for more information.

Three lineament zones have been identified namely the Northern, Central and Southern zones, commonly referred to as Motapa North, Motapa Central and Motapa South, respectively. Several pits have been mined in each zone. The regional strike and lithological contacts trend north-east to south-west and are dominated by the Peter Pan and the Courtleigh fault systems.

When Motapa was acquired by Metallon Corporation in December 2003 no mining activities had taken place since the year 2000 and its closure by Anglo American Corporation. At the time of acquisition, mining activities had ceased and remnant infrastructure included two shafts and a residential compound.

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Below is the location of Motapa on the Zimbabwean Map.

The figure below illustrates the open pits, oxide targets, core holes and infrastructure.

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The oxides are amenable to heap-leach extraction of gold. However, the arsenical sulphide ore is refractory. Several bench-scale and laboratory tests at Bilboes’ Isabella and Bubi before the year 2000 showed that good recoveries (90+%) are likely from bio-oxidation of a sulphide concentrate.

However, some of the work initiated by AMZIM (the gold operating subsidiary of Anglo American Corporation in Zimbabwe) was not completed and a priority will be to finalize potential extraction routes for the sulphides while exploiting the remaining oxides.

History

Historically, we understand that over 3 million tonnes were mined from underground operations down to 11 level and processed through a 25,000 tonnes per month plant between 1949-1959. Total gold production for the mine until 1990 was approximately 300,000 ounces from 2.4 million tonnes of ore, averaging 5.4 g/t.

When Motapa mine was acquired by Metallon Corporation in December 2003 no mining activities had taken place since the year 2000 closure by Anglo American Corporation.

On November 2, 2022 Caledonia announced that it had purchased Motapa Mining Company UK Limited, the parent company of a Zimbabwe subsidiary (Arraskar) which holds the Motapa Mining Lease.

Present Conditions and Infrastructure

The area is generally flat and covered by woodland interspersed with patches of grass and a major river (Mdutshana) flows through the property. The direction of flow is NE to SW. The location is at an altitude of about 1,148m above sea level.

The erratic and low rainfall makes the area unsuitable for cultivation and agricultural activities are restricted to ranching.

There are no obvious topographic, climatic, land use or other constraints that could materially affect production or exploration activities.

The property is accessible from Bulawayo by a tarred road, and by gravel roads within the Mining Mining Lease area. It is connected to the national power grid and obtains sufficient water from old pits and boreholes.

Permitting, Licenses and Encumbrances

Motapa is compliant in terms of authorizations and adheres to all government protocols and regulations as required.

The Motapa Mining Lease is registered with Number 22, issued on October 13, 1994, and covers 2,224 ha and is current. The lease is renewed annually and an inspection must be performed by the Ministry of Mines and requisite fees paid. A mining lease comprises claims consolidated into one mining unit. The Company ensures that the lease is up to date.

Geological Setting, Mineralization and Deposit

The Motapa deposit comprises three identified discrete, parallel shear-hosted mineralized zones, namely:

1. | Motapa North: with four sub-zones Pluvius and Jupiter. Pluvius is split into two named Pluvius123 and Pluvius5 with an information gap between them that assumes the possible existence of Pluvius4.
2. | Motapa Central: with three subzones Club, Britwell and Britwell East. There is Fossicker sub- parallel to Club and Britwell, but no data is available for evaluation, except that its existence is evidenced by a historical pit.
3. | Motapa South: with two subzones Halfday and Trail.

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Exploration and Planned Work

Substantive exploration work at Motapa can commence after an Environmental Impact Assessment (“EIA”) has been approved by the Zimbabwe authorities. An EIA report was submitted in July 2023 and certification was received in August 2023 paving way for exploration work to commence.

The Motapa exploration program entails the exploration of the deeper lying sulphide mineralisation at Motapa and will be achieved through a combination of reverse circulation and diamond drilling. It is planned to commence at a later date still to be determined.

ITEM 4A - UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 5 - OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following Operating and Financial Review and Prospects section is intended to help the reader understand the factors that have affected the Company's financial condition and results of operations for the historical period covered by the financial statements and management's assessment of factors and trends which are anticipated to have a material effect on the Company's financial condition and results in future periods. This section is provided as a supplement to, and should be read in conjunction with, our Consolidated Financial Statements and the other financial information contained elsewhere in this document. Our Consolidated Financial Statements have been prepared in accordance with IFRS. Our discussion contains forward-looking information based on current expectations that involve risks and uncertainties, such as our plans, objectives and intentions. Our actual results may differ from those indicated in such forward-looking statements.

A. Operating Results

The key drivers of our operating results and principal activities are:

● | revenue, which is influenced by:

| o | the price of gold, which fluctuates in terms of the realized USD gold price obtained; and
| o | our production tonnages and gold content thereof, impacting on the amount of gold we produce at our operations;

● | our cost of producing gold; and
● | other significant matters affecting profitability.

Revenue

Revenue increased to $146,314,000 in fiscal year 2023 from $142,082,000 in fiscal year 2022, (2021: $121,329,000). Gold produced was 78,466 oz. (2022: 80,775 oz.; 2021: 67,476 oz). The increase in revenue was due to an increase in the average realized gold price received to $1,910 per oz. (2022: $1,772 per oz.; 2021: $1,766 per oz.), offset by lower ounces sold in 2023 compared to 2022 (see below).

Gold price

Average realized gold price per ounce is a non-IFRS measure which management believes assists the stakeholders in understanding the average price obtained for an ounce of gold.

Our revenues are primarily derived from the sale of gold produced by Blanket Mine. As a result, our revenues are directly influenced by the average realized gold price obtained from the sale of gold. The gold prices obtained may fluctuate widely and are influenced by factors beyond the control of the Company. The table below indicates the average realized gold price per ounce obtained for the 2023, 2022 and 2021 fiscal years.

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$’000 |  | 2021 |  |  | 2022 |  |  | 2023 |
Revenue (IFRS) |  |  | 121,329 |  |  |  | 142,082 |  |  |  | 146,314 |
Revenue from silver sales |  |  | (122 | ) |  |  | (116 | ) |  |  | (118 | )
Revenue from gold sales |  |  | 121,207 |  |  |  | 141,966 |  |  |  | 146,196 |
Gold ounces sold |  |  | 68,617 |  |  |  | 80,094 |  |  |  | 76,532 |
Average realized gold price per ounce |  |  | 1,766 |  |  |  | 1,772 |  |  |  | 1,910 |

Gold produced

Tonnes milled, average grades, recoveries and gold produced are shown in the table below.

Blanket Mine Production Statistics
| Year | Tonnes Milled (t) | Gold Head (Feed) Grade (g/t Au) | Gold Recovery (%) | Gold Produced (oz.)
Quarter 1 | 2021 | 148,513 | 2.98 | 93.0 | 13,197
Quarter 2 | 2021 | 165,760 | 3.34 | 93.8 | 16,710
Quarter 3 | 2021 | 179,577 | 3.48 | 94.2 | 18,965
Quarter 4 | 2021 | 171,778 | 3.57 | 94.3 | 18,604
Year | 2021 | 665,628 | 3.36 | 93.9 | 67,476
Quarter 1 | 2022 | 165,976 | 3.69 | 94.1 | 18,515
Quarter 2 | 2022 | 179,118 | 3.71 | 93.9 | 20,091
Quarter 3 | 2022 | 198,495 | 3.53 | 93.6 | 21,120
Quarter 4 | 2022 | 208,444 | 3.37 | 93.7 | 21,049
Year | 2022 | 752,033 | 3.56 | 93.8 | 80,775
Quarter 1 | 2023 | 170,721 | 3.11 | 93.8 | 16,036
Quarter 2 | 2023 | 179,087 | 3.22 | 94.0 | 17,436
Quarter 3 | 2023 | 208,902 | 3.46 | 93.7 | 21,772
Quarter 4 | 2023 | 211,730 | 3.17 | 93.6 | 20,172
Year | 2023 | 770,440 | 3.25 | 93.8 | 75,416
Quarter 1 | 2024 | 175,101 | 3.23 | 93.9 | 17,050

Ounces produced decreased by 6.6% from 2022 to 2023. Tonnes milled in the year were 2.5% higher than 2022. Recoveries in the year remained the same as in 2022.

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Production cost

Production cost includes salaries and wages, on mine administration, consumable materials and electricity and other related costs incurred in the production of gold. Production cost for 2023, 2022 and 2021 is summarized below.

$ ‘000 |  | 2023 |  |  | 2022 |  |  | 2021 |  |
Blanket Mine |  |  | 69,591 |  |  |  | 62,998 |  |  |  | 53,126 |  |
Salaries and wages |  |  | 23,227 |  |  |  | 23,037 |  |  |  | 20,609 |  |
Consumable materials |  |  | 26,017 |  |  |  | 23,601 |  |  |  | 17,375 |  |
Consumable materials – COVID-19 |  |  | – |  |  |  | 311 |  |  |  | 297 |  |
Electricity costs |  |  | 13,496 |  |  |  | 9,634 |  |  |  | 10,407 |  |
Safety |  |  | 1,155 |  |  |  | 998 |  |  |  | 774 |  |
Cash-settled share-based expense |  |  | 637 |  |  |  | 853 |  |  |  | 692 |  |
On mine administration |  |  | 2,669 |  |  |  | 2,736 |  |  |  | 1,806 |  |
Security |  |  | 1,020 |  |  |  | 1,093 |  |  |  | 826 |  |
Solar operations and maintenance services |  |  | 647 |  |  |  | – |  |  |  | – |  |
Obsolete inventory |  |  | 282 |  |  |  | 563 |  |  |  | 36 |  |
Pre-feasibility exploration costs |  |  | 441 |  |  |  | 172 |  |  |  | 304 |  |
Bilboes |  |  | 13,118 |  |  |  | – |  |  |  | – |  |
Salaries and wages |  |  | 2,796 |  |  |  | – |  |  |  | – |  |
Consumable materials |  |  | 8,402 |  |  |  | – |  |  |  | – |  |
Electricity costs |  |  | 553 |  |  |  | – |  |  |  | – |  |
Cash-settled share-based expense |  |  | 23 |  |  |  | – |  |  |  | – |  |
On mine administration |  |  | 1,344 |  |  |  | – |  |  |  | – |  |
|  |  | 82,709 |  |  |  | 62,998 |  |  |  | 53,126 |  |

On-mine cost, all-in sustaining cost (“AISC”) and all-in cost per ounce

On-mine cost, AISC and all-in cost per ounce are non-IFRS cost measures which management believes assist the stakeholders in understanding the cost structures of the Company. The table below reconciles production cost as stated in terms of IFRS to these cost measures.

A narrow focus on the direct costs of production (mainly labour, electricity and consumables) does not fully reflect the total cost of gold production. Accordingly, cost per ounce data for the fiscal year and previous fiscal years has been prepared in accordance with the Guidance Note issued by the World Gold Council on June 23, 2013 and is set out in the table below on the following bases:

i. | On-mine cost per ounce, which shows the on-mine costs of producing an ounce of gold and includes direct labour, electricity, consumables and other costs that are incurred at the mine including insurance, security and on-mine administration;
ii. | All-in sustaining cost (“AISC”) per ounce, which shows the on-mine cost per ounce plus royalty paid, additional costs incurred outside the producing mines (i.e. at offices in Harare, Johannesburg, London and Jersey), costs associated with maintaining the operating infrastructure and reserve base that are required to maintain production at the current levels (sustaining capital investment), the share-based expense (or credit) arising from the long-term incentive plan awards (the “LTIPs”) less silver by-product revenue.
iii. | All-in cost per ounce, which shows AISC per ounce plus the additional costs associated with activities that are undertaken to increase production (expansion capital investment).

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Reconciliation of IFRS Production Cost to Non-IFRS Costs per ounce For 12 months ended December 31 |
($’000’s, unless otherwise indicated) |
|  | Bilboes Oxides |  |  | Blanket |  |  | Consolidated |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Production cost (IFRS) |  |  | 13,094 |  |  |  | - |  |  |  | 69,615 |  |  |  | 62,998 |  |  |  | 82,709 |  |  |  | 62,998 |
COVID-19 labour and consumable expenses |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (311 | ) |  |  | - |  |  |  | (311 | )
Cash-settled share-based expense |  |  | (10 | ) |  |  | - |  |  |  | (650 | ) |  |  | (853 | ) |  |  | (660 | ) |  |  | (853 | )
Less exploration and safety costs |  |  | - |  |  |  | - |  |  |  | (1,155 | ) |  |  | (998 | ) |  |  | (1,155 | ) |  |  | (998 | )
On-mine admin costs, employee incentives and intercompany adjustments |  |  | - |  |  |  | - |  |  |  | (797 | ) |  |  | (1,970 | ) |  |  | (797 | ) |  |  | (1,970 | )
On-mine production cost* |  |  | 13,084 |  |  |  | - |  |  |  | 67,013 |  |  |  | 58,866 |  |  |  | 80,097 |  |  |  | 58,866 |
Gold sales (oz) |  |  | 3,050 |  |  |  | - |  |  |  | 73,482 |  |  |  | 80,094 |  |  |  | 76,532 |  |  |  | 80,094 |
On-mine cost per ounce ($/oz) |  |  | 4,290 |  |  |  | - |  |  |  | 912 |  |  |  | 735 |  |  |  | 1,047 |  |  |  | 735 |
Royalty |  |  | 319 |  |  |  | - |  |  |  | 7,318 |  |  |  | 7,124 |  |  |  | 7,637 |  |  |  | 7,124 |
Exploration, remediation and permitting cost |  |  | - |  |  |  | - |  |  |  | 55 |  |  |  | 146 |  |  |  | 55 |  |  |  | 146 |
Sustaining capital expenditure# |  |  | 154 |  |  |  | - |  |  |  | 17,199 |  |  |  | 1,880 |  |  |  | 17,353 |  |  |  | 1,880 |
Sustaining administrative expenses& |  |  | - |  |  |  | - |  |  |  | 8,485 |  |  |  | 3,191 |  |  |  | 8,485 |  |  |  | 3,191 |
Inventory write-down |  |  | - |  |  |  | - |  |  |  | (283 | ) |  |  | (563 | ) |  |  | (283 | ) |  |  | (563 | )
Silver by-product credit |  |  | (4 | ) |  |  | - |  |  |  | (114 | ) |  |  | (116 | ) |  |  | (118 | ) |  |  | (116 | )
Cash-settled share-based payment expense included in production cost |  |  | - |  |  |  | - |  |  |  | 660 |  |  |  | 853 |  |  |  | 660 |  |  |  | 853 |
Cash-settled share-based payment expense |  |  | - |  |  |  | - |  |  |  | 463 |  |  |  | 609 |  |  |  | 463 |  |  |  | 609 |
Equity-settled share-based payment expense |  |  | - |  |  |  | - |  |  |  | 640 |  |  |  | 484 |  |  |  | 640 |  |  |  | 484 |
Procurement margin included in on-mine cost* |  |  | - |  |  |  | - |  |  |  | (4,422 | ) |  |  | (2,163 | ) |  |  | (4,422 | ) |  |  | (2,163 | )
All-in sustaining cost |  |  | 13,553 |  |  |  | - |  |  |  | 97,014 |  |  |  | 70,311 |  |  |  | 110,567 |  |  |  | 70,311 |
Gold sales (oz) |  |  | 3,050 |  |  |  | - |  |  |  | 73,482 |  |  |  | 80,094 |  |  |  | 76,532 |  |  |  | 80,094 |
AISC per ounce ($/oz) |  |  | 4,444 |  |  |  | - |  |  |  | 1,320 |  |  |  | 878 |  |  |  | 1,445 |  |  |  | 878 |
Non-sustaining administrative expenses& |  |  | - |  |  |  | - |  |  |  | 6,044 |  |  |  | 10,918 |  |  |  | 8,944 |  |  |  | 10,918 |
Permitting and exploration expenses |  |  | - |  |  |  | - |  |  |  | 32 |  |  |  | 59 |  |  |  | 32 |  |  |  | 59 |
Covid 19 expenses |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 311 |  |  |  | - |  |  |  | 311 |
Non-sustaining capital expenditure# |  |  | - |  |  |  |  |  |  |  | 12,253 |  |  |  | 45,555 |  |  |  | 12,253 |  |  |  | 45,555 |
Total all-in cost |  |  | 16,453 |  |  |  | - |  |  |  | 115,343 |  |  |  | 127,154 |  |  |  | 131,796 |  |  |  | 127,154 |
Gold sales (oz) |  |  | 3,050 |  |  |  | - |  |  |  | 73,482 |  |  |  | 80,094 |  |  |  | 76,532 |  |  |  | 80,094 |
All-in cost per ounce ($/oz) |  |  | 5,394 |  |  |  | - |  |  |  | 1,570 |  |  |  | 1,588 |  |  |  | 1,722 |  |  |  | 1,588 |

* | The on-mine cost reflects the cost incurred on-mine to produce gold. The procurement margin on consumable sales between CMSA and Blanket is not deducted from on-mine cost as the cost represents a fair value that Blanket would pay for consumables if they were sourced from a third party. The procurement margin on these sales is deducted from all-in sustaining costs and all-in costs as these numbers represent the consolidated costs at a group level, excluding intercompany profit margins.
& | Administrative expenses relate to costs incurred by the Group to provide services for mining and related activities. From quarter four in 2022 administrative expenses have been allocated between AISC and all-in cost.
# | Non-sustaining costs are primarily those costs incurred at ‘new operations’ and costs related to ‘major projects at existing operations’ where these projects will materially benefit the operation. All other costs related to existing operations are considered sustaining.

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On-mine cost

On-mine cost comprises labour, electricity, consumables, and other costs such as security and insurance which are directly related to production. Production costs are detailed in note 9 to the Consolidated Financial Statements. On-mine costs include the procurement margin paid to CMSA. CMSA purchasing represents a fair value that Blanket would pay for consumables if they were sourced from a third party and intercompany margins are not eliminated to calculate on-mine cost.

On-mine cost per ounce for the year was 42.5% higher than the previous year due to Bilboes costs being included.

The increase in on-mine cost per ounce compared to the comparative fourth quarter for 2023 is illustrated in the graph below.

The cost of oxide mining at Bilboes contributed $106 per ounce to the overall increase in the on-mine cost per ounce. The large amount of waste that was moved to access the oxide mineralization proved costly and Bilboes had an on-mine cost of $3,106 per ounce in the fourth quarter of 2023. Due to the oxide mining activities incurring losses, it was placed on care and maintenance at the end of September 2023. Leaching activities related to the heap leach pad will continue as long as it contributes to the care and maintenance cost of the Bilboes oxide mine. The net book value of the Bilboes oxide mine of $851,000 was impaired in the second quarter of 2023, as the oxide mine could not be run economically without including the sulphide project. Waste removal when designing the pit for the sulphide project will allow access to the oxide ounces and the sulphide ounces and justify the cost over more ounces.

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Production costs at Blanket increased from 2022 due to the higher than anticipated use of electricity due to the continued heavy use of infrastructure such as the No. 4 Shaft and Jethro Shaft which will be used more sparingly following the commissioning of the Central Shaft. The electricity usage is expected to reduce over the next 2 years as Blanket transitions from the old mine infrastructure and mining activities become more centralised in areas that the Central Shaft provides access to. Management is reviewing the timing of closing down other shafts and machinery or using the infrastructure more efficiently, thereby reducing power consumption in the future.

In April 2023 Blanket concluded a power supply agreement with the Intensive Energy Users Group (“IEUG") and the Zimbabwean power utility to allow the IEUG to obtain power outside Zimbabwe which is "wheeled” to the IEUG members. During the fourth quarter of 2023 Blanket paid less for IEUG sourced energy but the incidences of power outages and low voltage occurrences did not reduce due to the poor condition of the Zimbabwe grid which meant that diesel costs were incurred to supplement the low voltage occurrences. Management is conducting a study on how to alleviate the effect of the low voltage occurrences in the most economical manner.

The benefit of the solar plant is not recognised in on-mine cost because the solar plant (which is 100% owned by Caledonia) sells power to Blanket at a price per kilowatt/hour which reflects Blanket's historic blended cost per unit of power. The economic benefit of the solar plant is therefore recognised by Caledonia, rather than by Blanket, and the benefit ($38 per ounce of gold produced in 2023) is reflected in the AISC rather than the on-mine cost. The solar plant had the added benefit of stabilising the Blanket electrical grid by improving the power factor and in turn reducing generator usage to supplement reactive power.

Labour costs at Blanket increased during the fourth quarter of 2023 due to increased overtime hours, increased employment numbers at Blanket and inflationary increases. Management is investigating measures to utilise its workforce more efficiently and reduce overtime in future quarters.

Consumable costs per ounce at Blanket in 2023 increased compared to 2022 due to the cost to truck ore from the Central shaft to the metallurgical plant which is located close to the No. 4 Shaft area and increased explosive costs. Management is performing a cost study to assess the benefit of installing a conveyor to transport ore from Central Shaft to the metallurgical plant; an investigation has started to improve blasting techniques.

The on-mine cost per ounce at Blanket in 2023 was $912 which is within the guidance range of $860 to $950 per ounce. Guidance for cost per ounce at the Bilboes oxide mine was withdrawn in April 2023 when production guidance was also withdrawn.

All-in sustaining cost

All-in sustaining cost includes inter alia administrative expenses incurred outside Zimbabwe and excludes the intercompany procurement margin and the benefits of solar power as this reflects the consolidated cost incurred at the Group level. Accordingly, the all-in sustaining cost can only be calculated at a consolidated level and not at the level of individual operations.

During 2023 capital development cost of $9.5m was classified as sustaining capital expenditure due to the capital development cost incurred in the run of mine processes with no increase in production. In 2022 the capital development cost was classified as non-sustaining capital expenditure. This was mitigated somewhat by an increase in the intercompany procurement margin (which is deducted from on-mine cost for the purposes of calculating the consolidated AISC).

The AISC per ounce in 2023 increased by 64.6% compared to 2022, predominantly due to the higher on-mine cost per ounce and an increase in sustaining capital expenditure.

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The increase in AISC per ounce in the fourth quarter of 2023 compared to the comparative quarter is illustrated in the graph below:

All-in cost

All-in cost includes investment in expansion projects at Blanket and Bilboes which remained at a high level due to the continued investments in the Group. All-in cost does not include pre-feasibility investment in exploration and evaluation projects.

Other significant matters affecting profitability

Administrative expenses

Administrative expenses include the costs of Caledonia’s offices and personnel in Harare, Johannesburg, Bulawayo, the UK and Jersey which provide the following functions: technical services, finance, procurement, investor relations, corporate development, legal and company secretarial.

Administrative expenses in 2023 include a once-off $3.1 million paid to advisors on the successful conclusion of the Bilboes Gold Limited acquisition in January 2023. Wages and salaries in 2023 further increased following the absorption of certain administrative and executive functions following the completion of the Bilboes transaction and these resources have been deployed to working on the Bilboes feasibility study and have provided an enhanced degree of executive support in Harare. There has also been an increase in headcount in the Mineral Resource Management team in Johannesburg to support the implementation of a digital resource modelling and mine planning system. The digital mine planning tools allow for more flexible mine planning which has already resulted in real-time amendments to the mine plan which has reduced expenditure on capital development planned for 2024 and may result in further efficiencies in future years. An individual has also been recruited to improve the monitoring and reporting of the group’s environmental footprint in recognition of the increased stakeholder scrutiny in this area.

Administrative expenses are further analyzed in note 11 of the Consolidated Financial Statements.

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Other expenses

Other expenses are detailed in note 10 to the Consolidated Financial Statements and include an impairment expense on property, plant and equipment of $877,000. Included in this amount is the impairment loss that was recognised amounted to a carrying value of $851,000 on impairing the Bilboes oxide asset classified under mine development, infrastructure and other. On June 27, 2023 the decision was taken to place the Bilboes oxide mine on care and maintenance as the cost related to removing the waste and accessing the orebody could exceed the benefit from the gold revenues to be received. Mining and metallurgical processing continued at the Bilboes oxide mine until the end of September 2023 when the contract miner's notice period came to an end. Leaching of material that has already been deposited on the leach pad will continue while the revenue from these activities contributes to the cost of the asset. Oxide mining and processing will resume when the stripping of the waste for the sulphide project commences and can be economically justified.

Other expenses also include CSR expenses of $1,504,000 and impairment of $720,000 for the Solar VAT and duty receivable. Intermediated monetary transaction tax (“IMTT”) charged by the Zimbabwean government increased to $1,266,000 for 2023. IMTT is levied at a rate of 2% on RTGS$ denominated transactions and 1% on local foreign currency denominated transactions and outbound foreign payments.

Foreign exchange gains

On October 1, 2018 the RBZ issued a directive to Zimbabwean banks to separate foreign currency from RTGS$ in the accounts held by their clients and pegged the RTGS$ at 1:1 to the US Dollar. On February 20, 2019 the RBZ issued a further monetary policy statement, which allowed inter-bank trading between RTGS$ and foreign currency. The interbank rate was introduced at 2.5 RTGS$ to 1 US Dollar and traded at 6,104.72 RTGS$ to 1 US Dollar as at December 31, 2023 (December 31, 2022: 684.33 RTGS$). The US dollar has remained the primary currency in which the Group’s Zimbabwean entities operate and the functional currency of these entities.

In June 2021 the RBZ announced that companies that are listed on the VFEX will receive 100% of the revenue arising from incremental production in US Dollars. Blanket has subsequently received confirmation that the “baseline” level of production for the purposes of calculating incremental production is 148.38 Kg per month (approximately 57,000 ounces per annum). The payment of the increased US Dollars proceeds for incremental production was applied from July 1, 2021. In December 2021, Caledonia obtained a secondary listing on the VFEX and Blanket received all amounts due in terms of that revised policy. The CMCL listing on the VFEX enabled Blanket to receive approximately 72.74% of its total revenue in US Dollars and the balance in RTGS$.

On February 3, 2023, the RBZ issued Exchange control directive RY002/2023 stating that with effect from February 6, 2023, the US$ export retention threshold across all sectors, including companies listed on the VFEX, had been standardized to 75% of export proceeds. The incremental export incentive scheme was also discontinued with effect from February 1, 2023. On April 5, 2024, the Zimbabwean government introduced the ZiG and confirmed that the retention threshold will remain unchanged.

The table below illustrates the effect the weakening of the RTGS$ and other foreign currencies had on the consolidated statement of profit or loss and other comprehensive income.

‘$000 |  | 2023 |  |  | 2022 |  |  | 2021 |
Unrealised foreign exchange gain |  |  | 4,217 |  |  |  | 12,736 |  |  |  | 2,755 |
Realised foreign exchange loss |  |  | (6,767 | ) |  |  | (8,325 | ) |  |  | (1,571 | )
Net foreign exchange gain |  |  | (2,550 | ) |  |  | 4,411 |  |  |  | 1,184 |

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Put Options

From December 2022 to the date of this Annual Report the Company had the following put options to hedge our gold price risk:

Purchase date | Ounces hedged |  | Strike price |  | Period of hedge
December 22, 2022 | 16,672 oz |  | $1,750 |  | December 2022 - May 2023
May 22, 2023 | 28,000 oz |  | $1,900 |  | June - December 2023
December 19, 2023 | 12,000 oz |  | $1,950 |  | January - March 2024
March 7, 2024 | 12,000 oz |  | $2,050 |  | April to June 2024
April 10, 2024 | 12,000 oz |  | $2,100 |  | July – September 2024

Restricted Share Units and cash-settled Performance Units

Certain management and employees within the Group are granted Restricted Share Units (“RSUs”) and Performance Units (”PUs”) pursuant to provisions of the 2015 Omnibus Equity Incentive Compensation Plan (“OEICP”). All RSUs and PUs were granted and approved at the discretion of the Compensation Committee of the Board of Directors.

RSUs vest three years after grant date given that the service conditions of the relevant employees have been fulfilled. The value of the vested RSUs is the number of RSUs vested multiplied by the fair market value of the Company’s shares, as specified by the OEICP, on the date of settlement.

PUs have a performance condition based on gold production and, in recent awards, average normalised controllable cost per ounce of gold and a performance period of one to three years. The number of PUs that vest will be the relevant portion of the PUs granted multiplied by the performance multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.

RSU holders are entitled to receive dividends over the vesting period. Such dividends will be reinvested in additional RSUs at the then applicable share price. PUs have rights to dividends only after they have vested.

RSUs and PUs allow for settlement of the vesting date value in cash or, subject to conditions, shares issuable at fair market value or a combination of both at the discretion of the unitholder.

Refer to note 12.1 of the Consolidated Financial Statements for more information on the share-based payment awards.

During 2023 an aggregate of 327,086 PUs were awarded respectively to executives as well as to certain senior management and certain employees within the companies in the Group. An example of the award agreements are attached hereto as Exhibits 4.20, and 4.21. Refer to note 12.1(a) of the Consolidated Financial Statement for a further analysis of cash-settled share-based payments granted and vested.

Equity-settled Performance Units

PUs which are classified as equity-settled (i.e. there is no option to vest in cash) (“EPUs”) have a performance condition based on gold production, average normalized controllable cost per ounce of gold and a performance period of three years. The number of EPUs that vest will be the relevant portion of the EPUs granted multiplied by the performance multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.

EPUs have rights to dividends only after they have vested.

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The shares issued are subject to a minimum holding period of until at least the first anniversary of the EPUs vesting date.

194,466 EPUs remain outstanding as at December 31, 2023, where 80,773 were granted to certain employees within the Group during 2023. An example of the award agreement is attached hereto as Exhibits 4.21. Refer to note 12.2(a) of the Consolidated Financial Statement for a further analysis of equity-settled share-based payments granted.

Adjusted earnings per share

“Adjusted earnings per share” is a non-IFRS measure which management believes assists investors to understand the Company’s underlying performance. The table below reconciles “adjusted earnings per share” to the profit/loss attributable to owners of the Company shown in the financial statements which have been prepared under IFRS. Adjusted earnings per share is calculated by deducting payments to BETS (the company that owns 10% of Blanket’s shares on behalf of an employee trust), foreign exchange gains and losses, impairments, deferred tax and inventory write-downs from the profit attributable to the owners of the Company.

Reconciliation of Adjusted Earnings per Share (“Adjusted EPS”) to IFRS Profit Attributable to Owners of the Company |
($’000’s, unless otherwise indicated) |  |  |  |  |  |  |  |  |  |  |  |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Profit for the period (IFRS) |  |  | (618 | ) |  |  | 22,866 |  |  |  | 23,142 |
Non-controlling interest share of profit for the period |  |  | (3,580 | ) |  |  | (4,963 | ) |  |  | (4,737 | )
Profit attributable to owners of the Company |  |  | (4,198 | ) |  |  | 17,903 |  |  |  | 18,405 |
Blanket Mine Employee Trust adjustment |  |  | (346 | ) |  |  | (517 | ) |  |  | (326 | )
Earnings (IFRS) |  |  | (4,544 | ) |  |  | 17,386 |  |  |  | 18,079 |
Weighted average shares in issue (thousands) |  |  | 18,626 |  |  |  | 12,831 |  |  |  | 12,170 |
IFRS EPS (cents) |  |  | (24.4 | ) |  |  | 135.5 |  |  |  | 148.6 |
Add back/(deduct) amounts in respect of foreign exchange movements |  |  |  |  |  |  |  |  |  |  |  |
Realised net foreign exchange losses |  |  | 6,767 |  |  |  | 8,325 |  |  |  | 1,571 |
- less tax |  |  | (1,666 | ) |  |  | (2,056 | ) |  |  | (381 | )
- less non-controlling interest |  |  | (670 | ) |  |  | (827 | ) |  |  | (153 | )
Unrealised net foreign exchange gains |  |  | (4,217 | ) |  |  | (12,736 | ) |  |  | (2,755 | )
- less tax |  |  | 810 |  |  |  | 3,042 |  |  |  | 567 |
- less non-controlling interest |  |  | 349 |  |  |  | 1,265 |  |  |  | 270 |
Adjusted IFRS profit excl. foreign exchange |  |  | (3,171 | ) |  |  | 14,399 |  |  |  | 17,198 |
Weighted average shares in issue (thousands) |  |  | 18,626 |  |  |  | 12,831 |  |  |  | 12,170 |
Adjusted IFRS EPS excl. foreign exchange (cents) |  |  | (17.0 | ) |  |  | 112.2 |  |  |  | 141.3 |
Add back/(deduct) amounts in respect of: |  |  |  |  |  |  |  |  |  |  |  |
Reversal of Blanket Mine Employee Trust adjustment |  |  | 346 |  |  |  | 517 |  |  |  | 326 |
Impairment of property, plant and equipment |  |  | 877 |  |  |  | 8,209 |  |  |  | 497 |
Impairment of E&E assets |  |  | - |  |  |  | 467 |  |  |  | 3,837 |
Expected credit losses on deferred consideration on the disposal of subsidiary |  |  | - |  |  |  | - |  |  |  | 761 |
Bilboes pre-operational expenses |  |  | - |  |  |  | 830 |  |  |  | - |
Deferred tax |  |  | 4,358 |  |  |  | 3,796 |  |  |  | 5,240 |
Non-controlling interest portion deferred tax and impairment |  |  | (555 | ) |  |  | (1,629 | ) |  |  | (602 | )
Inventory write-down |  |  | 283 |  |  |  | 563 |  |  |  | - |
- less tax |  |  | (70 | ) |  |  | (139 | ) |  |  | - |
Fair value losses on derivative financial instruments |  |  | 1,119 |  |  |  | 1,198 |  |  |  | 240 |
Adjusted profit |  |  | 3,187 |  |  |  | 28,211 |  |  |  | 27,497 |
Weighted average shares in issue (thousands) |  |  | 18,626 |  |  |  | 12,831 |  |  |  | 12,170 |
Adjusted EPS (cents) |  |  | 17.1 |  |  |  | 219.9 |  |  |  | 225.9 |

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B. Liquidity and Capital Resources

Cash and cash equivalents

$’000 |  | 2023 |  |  | 2022 |
Bank balances |  |  | 4,252 |  |  |  | 4,737 |
Restricted cash * |  |  | 2,456 |  |  |  | 1,998 |
Cash and cash equivalents |  |  | 6,708 |  |  |  | 6,735 |
Bank overdrafts used for cash management purposes @ |  |  | (17,740 | ) |  |  | (5,239 | )
Net cash and cash equivalents |  |  | (11,032 | ) |  |  | 1,496 |

* | Cash of $2,456 (denominated in RTGS$) held by Blanket Mine was earmarked by Stanbic Bank Zimbabwe as a letter of credit in favor of CMSA. The letter of credit was issued by Stanbic Bank Zimbabwe on November 28, 2023 and settled in January, 2024. The cash on maturity was transferred to CMSA’s bank account, denominated in South African Rands.
@ | Interest paid on bank overdraft was $1,657 (2022: $192).

Blanket Mine has arranged unsecured overdraft facilities with the following banks and terms.

Overdraft facilities and term loans | Date drawn | Expiry | Repayment terms | Principal value | Balance drawn at December 31, 2023
Stanbic Bank - RTGS$ denomination | September 2023 | March 2024 | On demand | RTGS$300 million | $Nil
Stanbic Bank - USD denomination | September 2023 | March 2024 | On demand | $4 million | $3.8 million
Ecobank - USD denomination | November 2022 | December 2024 | On demand | $5 million | $5 million
Nedbank Zimbabwe - USD denomination | December 2022 | April 2024 | On demand | $3.5 million | $3.4 million
Nedbank Zimbabwe term loan - USD denomination | April 2023 | April 2024 | On demand | $3.5 million | $3.5 million
CABS – USD denomination | August 2023 | July 2024 | On demand | $2 million | $2 million

The distribution of the consolidated cash across the jurisdictions where the Group operates as at year end was as follows:

Geographical location of cash ($’000) |  |  |  |  |  |  |  |
|  | 2023 |  |  | 2022 |
Jersey, Channel Islands/ United Kingdom |  |  | 1,668 |  |  |  | 2,962 |
South Africa |  |  | 1,051 |  |  |  | 694 |
Zimbabwe (net of overdraft) |  |  | (13,751 | ) |  |  | (2,160 | )
Total net cash and cash equivalents |  |  | (11,032 | ) |  |  | 1,496 |

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An analysis of the sources and uses of Caledonia’s cash is set out in the Consolidated Statements of Cash Flows in the Consolidated Financial Statements.

As of December 31, 2023, Caledonia had a working capital surplus of $14,096,000 (2022: 5,986,000; 2021: $35,245,000). As of December 31, 2023, Caledonia had potential liabilities for rehabilitation work on Blanket (2023 and prior), Motapa, Maligreen (2023 and prior) and Bilboes – if and when those mines permanently close – at an estimated present value cost of $10,985,000 ($2,958,000; 2020: $3,294,000). The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to pursue its mining operations and exploration activities.

The Company’s primary objective with respect to its capital management is to ensure that it has enough cash resources to maintain its ongoing operations, to provide returns for shareholders, complete the investment plan and accommodate any asset retirement obligation. Refer to note 33 of the Consolidated Financial Statements for information on the type of financial instruments used and the maturity profiles thereof. Management believes that the current working capital and future production cash proceeds will be enough to meet its capital requirements.

As at December 31, 2023, the Company had the following contractual obligations:

Payments due by Period ($’000) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Falling due |  | Within 1 year |  |  | 1-3 years |  |  | 4-5 years |  |  | After 5 years |  |  | Total |
Trade and other payables |  |  | 20,503 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 20,503 |
Provisions |  |  | 45 |  |  |  | 381 |  |  |  | 325 |  |  |  | 10,234 |  |  |  | 10,985 |
Capital expenditure commitments |  |  | 2,035 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,035 |
Lease liabilities |  |  | 167 |  |  |  | 41 |  |  |  | - |  |  |  | - |  |  |  | 208 |
Cash-settled share-based payments |  |  | 920 |  |  |  | 374 |  |  |  | - |  |  |  | - |  |  |  | 1,294 |
Loan notes (solar bonds) |  |  | 665 |  |  |  | 6,447 |  |  |  | - |  |  |  | - |  |  |  | 7,112 |

Except for capital expenditure commitments, the contractual obligations in the table above are based on the classification requirements under IFRS.

The capital expenditure commitments relate to materials and equipment which have been ordered by CMSA and which will be sold to Blanket.

Other than the proposed investment in the exploration properties, the committed and uncommitted investment will be used to maintain Blanket’s existing operations and implement the final development relating to the Central Shaft and the further stages of the new TSF.

Committed and uncommitted purchase obligations are expected to be met from the cash generated from Blanket’s existing operations and Blanket’s existing borrowing facilities. The Group leases property for its administrative offices in Jersey, Harare and Johannesburg; following the implementation of IFRS 16 the Group recognises the liabilities for these leases. As of December 31, 2023, the Group had liabilities for rehabilitation work on Blanket – if the mine is permanently closed – at an estimated discounted cost of $4.8 million (December 31, 2022: $2.8 million), Motapa’s liability amounted to $1.4 million (December 31, 2022: $Nil), Maligreen’s liability amounted to $287,000 (December 31, 2022: $135,000), and Bilboes’ liability amounted to $4.4 million (December 31, 2022: $Nil).

Blanket foreign exchange approval requirements

Approval from the RBZ is required for the remittance of dividends declared from Zimbabwe, for the repayment of loans and advances from Blanket Mine to Caledonia and the repayment of capital and consumables purchased from CMSA. During 2023 Caledonia obtained the necessary approvals from the RBZ to obtain foreign currency to conduct normal business operations. This remained the case until the date of this Annual Report.

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Equity Raise

During March and April 2023, the Company conducted a placing of depositary interests and depositary receipts in its shares in the UK, South Africa and Zimbabwe. A total of 1,207,514 common shares were placed in the form of depositary interests and depositary receipts raising in total approximately US$16.62 million before expenses.

C. Research and development, patents and licenses, etc.

The Company is an exploration, development and mining company and does not carry on any research and development activities.

D. Trend Information

Production Guidance

Blanket production for 2023 was 75,416 ounces, which was over the lower end of the revised guidance range of 75,000 – 80,000 ounces. Refer to Item 5.A – “Operating Results”, for further discussion and detail of actual production.

Production guidance for Blanket for 2024 is between 74,000 and 78,000 ounces.

Production guidance for the oxide mining activities was withdrawn in the third quarter of 2023.

Cost Guidance

The estimated on-mine cost for 2023 was in the range of $860 to $950 per ounce and the estimated AISC for 2023 was in the range of $1,130 to $1,230 per ounce. The actual on-mine cost per ounce for 2023 was $945 and actual AISC per ounce for 2023 was $1,320.

The Group’s consolidated on-mine cost per ounce guidance for 2024 is in the range of $870 to $970 per ounce; guidance for consolidated AISC is $1,370 to $1,470 per ounce (excluding CSR costs). This is forward looking information. Refer to “CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS” of this report for further information on forward looking statements.

Cost guidance for the oxide mining activities was withdrawn in the third quarter of 2023.

E. Critical Accounting Estimates

Not applicable.

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ITEM 6 - DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. Directors and Senior Management

The following is a list of our current directors and the Group’s senior management as of April 26, 2024.

Name, Office Held and Municipality of Residence | Principal Occupations During Past Five Years | Director Since and Independence Status | Number of Common Shares* As of April 26, 2024
John Kelly Non-Executive Director Chairperson New Canaan, Connecticut USA | Managing Partner of Active Capital Partners Chairman and Independent Trustee, The Victory Funds Non-Executive Member of Kellys Family Foods LLC | 2012 Independent | 16,317
Mark Learmonth Chief Executive Officer Director Jersey, Channel Islands | Chief Financial Officer of the Company (until June 30, 2022) Chief Executive Officer of the Company (from July 1, 2022) Director of the Company | 2014 Non-Independent | 184,984
Steven Curtis Non-Executive Director Johannesburg, South Africa | Chief Executive Officer of the Company (until June 30, 2022) Director of the Company | 2008 Non-Independent | 189,566
Caxton Mangezi Vice-president Zimbabwe operations Zimbabwe, Gwanda | Blanket General Manager (until July 2021) Vice-president Zimbabwe operations (from July 2021) | 1993 Non-Independent | 2,605
Johan Holtzhausen Non-Executive Director Western Cape, South Africa | Business consultant and Independent Director of DRDGOLD Limited | 2013 Independent | 23,250
Nick Clarke Non-Executive Director Falmouth, Cornwall, United Kingdom | Chairman and formerly Chief Executive Officer of Central Asia Metals Plc | 2019 Independent | Nil
Geralda Wildschutt Non-Executive Director Johannesburg, South Africa | Founder and CEO of Maisha Social Solutions Pty Ltd Member of Sasol Climate Change Advisory Panel Board member of SAICA ED Pty Ltd | 2021 Independent | Nil
Gordon Wylie Non-Executive Director Malta | Non-executive director of Chaarat Gold Holdings Limited Former non-executive director of Silverton Metals Corp Former chairman of Lydian International Limited | 2022 Independent | Nil

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Name, Office Held and Municipality of Residence | Principal Occupations During Past Five Years | Director Since and Independence Status | Number of Common Shares* As of April 26, 2024

Victor Gapare Executive Director Harare, Zimbabwe | Director of the Company Former chief executive officer of Bilboes Holdings (Private) Limited | 2023 Non-Independent | **2,411,186
Maurice Mason Vice-president Corporate Development London, United Kingdom | Vice-president Corporate Development | Not a Director | Nil
Adam Chester General Counsel, Company Secretary and Head of Risk and Compliance Jersey, Channel Islands | General Counsel, Company Secretary and Head of Risk and Compliance | Not a Director | 28,386
Chester Goodburn Chief Financial Officer Johannesburg, South Africa | Chief Financial Officer of the Company (from July 1, 2022) | Not a Director | 7,861
Tariro Gadzikwa Non-Executive Director Johannesburg, South Africa | Founder and Chief Executive Officer of MWJ Consulting Proprietary Limited | 2024 Non-Independent | Nil
J Mufara Chief Operating Officer Johannesburg, South Africa | Chief Operating Officer of the Company (from May 1, 2024) | Not a Director | Nil

* | The information in this Circular as to shares beneficially owned or controlled or directed not being within the knowledge of the Company has been furnished by the respective nominees individually.
** | Mr Gapare is interested in the Common Shares held by Toziyana Resources Limited as the settlor of a discretionary trust which ultimately owns Toziyana Resources Limited.

No family relationships exist between any of the Directors or senior management.

A brief profile of each of the Directors and senior managers is given below:

John Kelly - Non-Executive Director and Chairperson

Mr. John Lawson Kelly has over 39 years of experience in the financial services industry in the U.S and international markets including emerging markets in Asia. Mr. Kelly is currently Managing Partner of Active Capital Partners LLC, Charmain and Independent Trustee of the Victory Funds and a non-executive Member of Kellys Family Foods LLC. Mr. Kelly is a graduate of Yale University and the Yale School of Management.

Mr. Kelly was appointed to the Caledonia board as an independent non-executive director in May 2012 and became Chairperson in 2023.

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Mark Learmonth – Director and Chief Executive Officer

Mr. John Mark Learmonth joined Caledonia in July 2008. Prior to this, he was a Division Director of Investment Banking at Macquarie First South in South Africa and has over 18 years of experience in corporate finance and investment banking, predominantly in the resources sector. Mr. Learmonth graduated from Oxford University and is a chartered accountant. He was previously a member of the Executive Committee of the Chamber of Mines, Zimbabwe and a member of the Gold Producers Sub-Committee.

Mr. Learmonth was appointed Vice-President Finance, Chief Financial Officer of the Company in November 2014. Mr. Learmonth was responsible for Investor Relations and Corporate Development of the Company until the appointments of Mr. Maurice Mason (VP Corporate Development) and Ms. Camilla Horsfall (VP Investor Relations and VP Group Communications) in 2016 and 2020, respectively. Mr. Learmonth was appointed as Chief Executive Officer with effect from July 1, 2023.

Steven Curtis, CA (SA) – Director

Mr. Steven Roy Curtis is a Chartered Accountant with over 38 years of experience and has held a number of senior financial positions in the manufacturing industry. Before joining Caledonia in April 2006, he was Director Finance and Supply Chain for Avery Dennison SA and, prior to this, Financial Director and then Managing Director of Jackstadt GmbH South African operation. Mr. Curtis is a member of the South African Institute of Chartered Accountants and graduated from the University of Cape Town.

Mr. Curtis was appointed Vice-President Finance and Chief Financial Officer in April 2006 and served in the position until Dec 2014 when he was appointed as President and Chief Executive Officer. Mr Curtis resigned as Chief Executive Officer with effect from June 30, 2022. From that date until December 31, 2025 he is retained by the Company pursuant to aconsultancy agreement and remained a director in a non-executive capacity. Given his past role with the Company, he is not considered independent.

Johan Holtzhausen - Non-Executive Director

Mr. Johan Andries Holtzhausen is a retired partner of KPMG South Africa with 43 years of audit experience, of which 36 years were as a partner focused on the mining sector. Mr. Holtzhausen chaired the Mining Interest Group at KPMG South Africa and his clients included major listed mining companies operating in Africa and elsewhere, which operated across a broad range of commodities. In addition to his professional qualifications, Mr. Holtzhausen holds a B.Sc. from the University of Stellenbosch, majoring in chemistry and geology. Mr. Holtzhausen is a business consultant and independent director of DRDGOLD Limited.

Mr. Holtzhausen is chairman of the Audit Committee and a member of the Remuneration Committee and Nomination Committee of DRDGOLD Limited.

Nick Clarke - Non-Executive Director

Mr. Nick Clarke joined the Company’s board as a Non-Executive Director on September 23, 2019. Mr. Clarke, who is Chairman of Central Asia Metals PLC (AIM: CAML), is a highly experienced Chartered Engineer (CEng) with 48 years in the mining industry. He has held senior positions in several resource companies and is well known as a successful executive in the sector having been involved in the construction of major mining projects and conducted several fundraisings on AIM and TSX.

He has an extensive background in managing AIM and TSX listed minerals companies including his current position as Chairman of Central Asia Metals PLC, where he was CEO from 2009 until 2016. Between 2004 and 2008 he was Managing Director of Oriel Resources plc (AIM: ORI) and from 2006 to 2008 he was President and CEO of Lero Gold Corporation (TSX: LER). Mr. Clarke has significant experience as a non-executive director of a number of AIM and TSX listed resource companies having previously held non-executive directorships on the boards of Afcan Mining Corp. (TSX: AFK), Caledon Resources plc (AIM: CDN), Obtala Resources plc (AIM: OBT), Columbus Copper Corp (TSX: CCU) and Sunkar Resources plc (AIM: SKR).

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Mr. Clarke is an Associate of Camborne School of Mines (ACSM). He is a trustee of the Camborne School of Mines Trust and is a member of the Institution of Materials Minerals & Mining (MIMMM).

Geralda Wildschutt – Non-Executive Director

Geralda has over 27 years’ experience in stakeholder engagement, corporate social responsibility, ESG risk management and the just energy transition. She has worked in mining, renewable energy, banking and the social sector, across Africa, Latin America, Australia and Canada.

In mining, she has been a consultant to Anglo American, Gold Fields, Ivanhoe Mines and Debswana on a range of ESG topics. She has held senior positions at Anglo American, Gold Fields, ABSA/ Barclays Group and Ashoka: Innovators for the Public. She also serves as a non-executive director of JSE listed Northam Holdings Limited.

Geralda hold a Masters degree in Psychology from the University of Cape Town, an MBA from the Business School of the Netherlands and a post-graduate Certificate in Cross-sector Partnerships from Cambridge University’s Sustainability Insititute.

Geralda was appointed to the Caledonia board as an independent non-executive director in 2021.

Gordon Wylie – Non-Executive Director

Mr. Wylie holds a bachelor’s degree with Honours in Geology from the University of Glasgow, a Management Diploma from UNISA South Africa and a Postgraduate Diploma in Mining Engineering and Mineral Economics from Wits University, South Africa.

Mr. Wylie has over 47 years’ experience in the mining industry in both mining and exploration geology. Between 1997 and 2005, Mr. Wylie was part of AngloGold Ashanti Limited’s senior management team where he was responsible for the company’s global exploration programs, mining geology and associated technical services, covering around 40 countries and 5 continents.

Since leaving AngloGold Ashanti, Gordon has accumulated 17 years’ board experience as a non- executive director, of which 12 were as chairman at Lydian International Limited. He is currently a non-executive director of Chaarat Gold Holdings Limited, which is listed on AIM (symbol: CGH), and a former non-executive director of Silverton Metals Corp., which is listed on TSX-V (symbol: SVTN).

Victor Gapare – Executive Director

Mr. Victor Gapare is a prominent Zimbabwean mining entrepreneur and, following the acquisition of Bilboes, is interested in approximately 12.56% of the shares in Caledonia through Toziyana Resources Limited which is ultimately owned by a family trust of which Mr. Gapare is the settlor.

Mr. Gapare was previously the Director responsible for the gold and pyrites business of Anglo American Corporation Zimbabwe Limited when Bilboes was part of its portfolio, prior to a management buyout in which he was involved, and is a former President of the Chamber of Mines Zimbabwe.

Mr. Gapare was appointed to the Caledonia board as an executive director in January 2023 on completion of the acquisition of Bilboes Gold.

Adam Chester – General Counsel, Company Secretary and Head of Risk and Compliance

In January 2017 Mr. Adam Chester joined the management team as General Counsel, Company Secretary and Head of Risk and Compliance. Mr. Chester is a dual qualified lawyer (England and Jersey, Channel Islands) and previously worked as a solicitor of the Supreme Court of England and Wales at international law firms in the City of London and, more recently, as an advocate of the Royal Court of Jersey at an international offshore law firm in which he was a partner. He has extensive experience advising businesses and individuals on a variety of commercial and corporate legal issues.

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Caxton Mangezi – Vice-president Zimbabwe operations

Mr. Caxton Mangezi is a qualified miner and mine manager. He has worked at Blanket since 1969 in a range of roles including geological technician, overseer miner and underground manager.

Mr. Mangezi has been General Manager of Blanket Mine since 1993 in full time and interim capacities, with full responsibility for day-to-day operations. Mr. Mangezi was appointed as the Vice President Zimbabwe Operations during 2021. Mr. Mangezi also serves as director on certain Zimbabwean subsidiary companies.

Maurice Mason – Vice-president Corporate Development

Maurice is an engineer with an MBA from Henley Reading University. Before joining Caledonia, Maurice was a securities analyst at Stifel, a US Investment bank, where he focused on the mining sector.

Prior to working as a securities analyst Maurice worked for six years with Anglo American in their platinum and coal operations based in both the Johannesburg and London offices.

Chester Goodburn – Chief Financial Officer

Mr. Goodburn is a qualified Chartered Accountant with 15 years’ experience in the energy and natural resources sector. He worked as a senior manager at KPMG South Africa where he was seconded to several clients providing audit, tax and advisory services to several JSE, NYSE, AIM and TSX listed clients.

Mr. Goodburn was the Group Financial Manager from September 1, 2014 to June 30, 2022 and Chief Information Officer until April 30, 2022. Mr. Goodburn was appointed as Chief Financial Officer on July 1, 2022.

Tariro Gadzikwa – Non-Executive Director

Tariro is a Chartered Accountant and the Founder and Chief Executive Officer of MWJ Consulting Proprietary Limited, an advisory firm specializing in financial reporting and due diligence for listed and private equity clients within the mining, oil and gas and energy sectors.

Prior to founding MWJ, she was Group Chief Financial Officer of Efora Energy Ltd ("Efora", formerly SacOil Holdings) at which she held various executive roles in the finance team over eight years. She started her career at PwC in Zimbabwe and subsequently worked in the Johannesburg, Baltimore and London offices, where she provided audit and financial advisory services including financial due diligence and strategy development to medium and large corporates in Zimbabwe, South Africa, the US and UK.

She has held a number of board positions, including most recently at Efora and several of its subsidiaries in South Africa, Seychelles, Nigeria and Botswana, and currently serves on the board of Structured Risk Solutions where she chairs the Nominations Committee.

She graduated from Rhodes University, South Africa with a B.Com in accounting in 2001.

Tariro was appointed to the Caledonia board as an independent non-executive director during March 2024.

James Mufara – Chief Operating Officer

James Mufara was previously at Harmony Gold Mining Company Limited where, as Regional General Manager, he headed a complex portfolio of operations consisting of five mines and 15,000 staff, mining 450koz of gold per annum.

James has over 25 years' experience in the mining sector in Southern Africa, including 13 years in leadership roles. His career has been primarily gold focused, but also with exposure to nickel, copper, and chrome mining. His experience includes deep-level underground mining and open-pit operations, which is relevant to the existing underground operation at Blanket mine and Caledonia's development projects at Bilboes and Motapa which will be open-pit. He holds a BSc in Mining Engineering and an MBA.

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Arrangements, Understandings, etc.

Caledonia has no arrangements or understanding with any major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director or member of senior management other than Mr. Gapare who was appointed as a director pursuant to the sale and purchase agreement for the acquisition of Bilboes Gold.

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B. Compensation

Summary Compensation Table

Name and principal position | Year | Salary ($) | Share-based awards ($)(1) | Option-based awards | Non‑equity incentive plan compensation ($) | Pension value ($) | All other compensation ($) | Total compensation ($)
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h)(2) (3)(4) | (i)
|  |  |  |  | Annual incentive plans (1) | Long term incentive plans |  |  |
Mark Learmonth Chief Financial Officer (until June 30, 2022) Chief Executive Officer (from July 1, 2022) | 2023 2022 2021 | 517,500 494,315 480,011 | 263,304 94,692 89,645 | - - - | - - - | - - - | - - - | - 175,000 235,000 | 780,804 764,007 804,656
Dana Roets Chief Operating Officer | 2023 2022 2021 | 518,381 500,851 489,590 | (9,281) 95,397 80,564 | - - - | - - - | - - - | - - - | 1,588,108 160,000 170,000 | 2,097,208 756,248 740,154
Caxton Mangezi Vice President Operations Zimbabwe | 2023 2022 2021 | 568,235 463,960 429,478 | 179,167 175,116 123,250 | - - - | - - - | - - - | - - - | 580,507 734,730 211,615 | 1,327,909 1,373,806 764,343
Chester Goodburn Chief Financial Officer (from July 1, 2022) | 2023 2022 | 336,375 309,123 | 59,374 31,010 | - | - | - | - | - 70,000 | 395,749 410,133
Victor Gapare Executive Director | 2023 | 478,654 | 43,368 | - | - | - | - | 89,505 | 611,527
Maurice Mason VP Corporate Development | 2023 2022 2021 | 337,261 325,856 222,123 | 84,883 53,335 56,624 | - - - | - - - | - - - | - - - | -- 130,000 111,061 | 422,144 509,191 389,808
Adam Chester General Counsel, Company Secretary and Head of Risk and Compliance | 2023 2022 2021 | 337,874 313,038 228,891 | 99,161 65,769 119,103 | - - - | - - - | - - - | - - - | 70,000 160,000 114,445 | 507,035 538,807 462,439

(1) | Awards are considered to be share based awards. The amounts stated are the expenses for the year to revalue the liability to the amount that is expected to vest at the applicable year end. Refer to table below for the awards outstanding as at December 31, 2023.
(2) | The amounts shown in (h) relate to bonuses paid to normal executive officers (”NEOs”) and, for Mr Caxton and Mr Gapare it also include other employee benefits. No fees for acting as a Director were paid to NEOs. The amount for Mr Roets include his severance package provided for in 2023 but which were paid in January 2024 and February 2024.
(3) | The amounts shown in (h) for the NEOs for 2023 relate to bonuses provided for in 2023 but were paid in April 2024.

Non-executive director fees were paid in equal quarterly instalments in arrears during 2023. From January 1, 2023 to December 31, 2023 the approved non-executive director fees amounted to $90,000 p.a. payable to each non-executive director other than Leigh Wilson (resigned in May 2023), who received a pro-rata amount of $30,907 for his services in 2023.

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Long term incentive plan

The following key management members were granted RSUs, PUs and EPUs, pursuant to the provisions of the OEICP. The outstanding RSUs and PUs as at December 31, 2023 were as follows:

Key management member | Vesting date | RSUs | PUs | EPUs
Steve Curtis | 2024/01/11 2025/01/11 | - - | 8,769 - | - 39,689
Mark Learmonth | 2024/01/11 2025/01/11 2026/04/01 | - - - | 5,422 - - | - 36,812 27,542
Caxton Mangezi | 2024/01/11 2025/01/11 2026/04/01 | - - - | 4,657 - - | - 15,458 13,441
Chester Goodburn* | 2024/01/11 2025/01/11 2026/04/01 | - - - | 564 1,759 - | - - 10,890
Adam Chester | 2024/01/11 2025/01/11 2026/04/01 | - - - | 3,509 - - | - 10,877 7,992
Maurice Mason | 2024/01/11 2025/01/11 2026/04/01 | - - - | 2,459 - - | - 10,857 7,977
Victor Gapare** | 2026/04/01 | - | - | 11,506
Total |  | - | 27,139 | 193,041

* Chester Goodburn was appointed as a key management member from July 1, 2022 when he became CFO.

** Victor Gapare was appointed as key management from January 6, 2023.

For further detail on the RSUs, PUs and EPUs refer to note 12 of the Consolidated Financial Statements.

125,433 EPUs were awarded to key management staff on April 8, 2024.

No director equity options were outstanding at December 31, 2023.

Caledonia does not have a pension, retirement or similar benefits scheme for directors.

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C. Board Practices

The directors all hold their positions for an indefinite term, subject to re-election at each annual general meeting of the shareholders. The officers hold their positions subject to being removed by resolution of the Board of Directors. The term of office of each director expires as of the date that an annual general meeting of the shareholders is held, subject to the re-election of a director at such annual general meeting. The following persons comprise the following committees:

Audit | Compensation | Nomination and Corporate Governance | Technical | Disclosure
J Holtzhausen | J Kelly | J Kelly | M Learmonth | M Learmonth
G Wylie | J Holtzhausen | J Holtzhausen | J Holtzhausen | C Goodburn
G Wildschutt | G Wylie | N Clarke | N Clarke | A Chester
T Gadzikwa | T Gadzikwa | G Wildschutt | G Wylie | C Horsfall
|  | G Wylie | V Gapare | J Mufara
|  | T Gadzikwa | S Curtis |
|  |  | C Mangezi |
Strategic Planning | ESG |  | J Mufara |
J Kelly | G Wildschutt |  |  |
S Curtis | A Chester |  |  |
J Holtzhausen | C Horsfall |  |  |
M Learmonth | J Kelly |  |  |
N Clarke | M Learmonth |  |  |
G Wildschutt | S Curtis |  |  |
G Wylie | N Clarke |  |  |
V Gapare | V Gapare |  |  |
M Mason |  |  |  |
C Goodburn T Gadzikwa J Mufara |  |  |  |

The Audit Committee is comprised of Mr. Holtzhausen, Mr. Wylie, Ms. Wildschutt and Ms. Gadzikwa and is chaired by Mr. Holtzhausen. Each member of the Audit Committee is considered independent as defined under NI 52-110 and as defined under Section 803 of the NYSE American LLC Company Guide and Exchange Act Rule 10A-3 and considered to be financially literate as such terms are defined under NI 52-110 Audit Committees. Mr. Holtzhausen is an ex-audit partner of KPMG Inc., Mr. Wylie has significant experience operating at the most senior levels in mining companies, Ms. Wildschutt has relevant experience as a board member and trustee for various organizations and Ms. Gadzikwa is a chartered accountant and previous Chief Financial Officer of a listed company.

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The Audit Committee is responsible for assisting the Board in:

1. | Opening an avenue of communication between Caledonia’s management, the independent auditors and the Board and to assist the Board in its oversight of the:

| ● | integrity, adequacy and timeliness of Caledonia’s financial reporting and disclosure practices;
| ● | processes for identifying the principal financial risks of Caledonia and the control systems in place to monitor them;
| ● | compliance with legal and regulatory requirements related to financial reporting;
| ● | independence and performance of the independent auditors;
| ● | processes implemented by management to ensure effective internal controls over financial reporting;
| ● | enterprise risk management;
| ● | fraud risks related to financial reporting;
| ● | other risks related to financial reporting; and
| ● | integrated reporting.

2. | Performing any other activities consistent with the charter of the Audit Committee to ensure that Caledonia’s articles of association, governing and regulatory laws as required by the SEC, Sarbanes-Oxley Act and NYSE American LLC and AIM requirements are monitored by management.
3. | The role of oversight. Compilation of financial statements is the responsibility of management. The auditors are responsible for performing an audit and expressing an opinion on the fair presentation of Caledonia’s financial statements in accordance with IFRS.
4. | Ensuring that a combined assurance model is developed and implemented to provide a coordinated approach to all assurance activities.

The purpose of the Compensation Committee is to discharge the Board’s responsibilities relating to:

1. | Compensation of the executive officers and the directors;
2. | Establishment and administration of policies, programs and procedures for compensating and incentivizing its executive officers;
3. | Oversight of the compensation structure and benefit plans and programs;
4. | Executive compensation disclosure and compliance with compensation policies; and
5. | Administration and application of the Company’s Incentive Compensation Recovery Policy (as defined herin).

Terms of reference of the Audit Committee are given in the charter of the Audit Committee, and the terms of reference of the Compensation Committee are given in the charter of the Compensation Committee. All charters of committees are available on the Company’s website (www.caledoniamining.com) or, on request, from the Company’s offices listed in this report.

Benefits upon termination are disclosed in note 36 of the Consolidated Financial Statements.

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D. Employees

The average, approximate number of employees, their categories and geographic locations for each of the last three years are summarized in the table below:

Geographic Location and Number of Employees: |  |  |  |  |  |  |  |  |  |  |  |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Total Employees |  |  |  |  |  |  |  |  |  |  |  |
London, United Kingdom - Management and administration |  |  | 3 |  |  |  | 2 |  |  |  | 2 |
Jersey, Channel Islands - Management and administration |  |  | 4 |  |  |  | 3 |  |  |  | 3 |
South Africa - Management, procurement, administration and technical |  |  | 31 |  |  |  | 23 |  |  |  | 21 |
Zimbabwe - Mine operations, management and administration |  |  | 2,294 |  |  |  | 2,119 |  |  |  | 1,923 |
Total Employees at all Locations |  |  | 2,332 |  |  |  | 2,147 |  |  |  | 1,949 |

Management and Administration: |  |  |  |  |  |  |  |  |  |  |  |
Employee Locations: |  | 2023 |  |  | 2022 |  |  | 2021 |
London, United Kingdom - Management and administration |  |  | 3 |  |  |  | 2 |  |  |  | 2 |
Jersey, Channel Islands - Management and administration |  |  | 4 |  |  |  | 3 |  |  |  | 3 |
Zimbabwe - Mine operations, management and administration |  |  | 105 |  |  |  | 54 |  |  |  | 55 |
South Africa - Management, procurement, administration and technical |  |  | 30 |  |  |  | 22 |  |  |  | 20 |
Total Management and Administration |  |  | 142 |  |  |  | 81 |  |  |  | 80 |

E. Share Ownership

(a) | The direct and indirect shareholdings of the Company’s directors, officers and senior management as at April 26, 2024 were as follows:

|  |  | Number of shares |  |  | Percentage share holding |
| J Kelly |  |  | 16,317 |  |  |  | 0.09 | %
| S Curtis |  |  | 189,566 |  |  |  | 0.99 | %
| M Learmonth |  |  | 184,984 |  |  |  | 0.96 | %
| J Holtzhausen |  |  | 23,250 |  |  |  | 0.12 | %
| A Chester |  |  | 28,386 |  |  |  | 0.15 | %
| C Goodburn |  |  | 7,861 |  |  |  | 0.04 | %
| V Gapare |  |  | *2,411,186 |  |  |  | 12.56 | %
| C Mangezi |  |  | 2,605 |  |  |  | 0.01 | %
| N Clarke |  |  | - |  |  |  | 0.00 | %
| G Wildschutt |  |  | - |  |  |  | 0.00 | %
| G Wylie |  |  | - |  |  |  | 0.00 | %
| M Mason |  |  | - |  |  |  | 0.00 | %
| T Gadzikwa |  |  | - |  |  |  | 0.00 | %
| J Mafura |  |  | - |  |  |  | 0.00 | %
| Total |  |  | 2,864,155 |  |  |  | 14.92 | %

| * | Mr Gapare is interested in the Common Shares held by Toziyana Resources Limited as the settlor of a discretionary trust which ultimately owns Toziyana Resources Limited.

Refer to Item 6.A – “Directors and Senior Management” for a list of the Company’s directors, officers and senior management and number of shares held.

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All of the shares held above are voting shares and do not have any different voting or other rights than the other outstanding shares of the Company.

The information as to shares beneficially owned or controlled or directed, not being within the knowledge of the Company, has been furnished by the respective directors, officers and senior management members individually.

(b) | Share purchase options outstanding as of April 26, 2024:

Name | Role | Exercise Price CAD | Expiry Date | Number of Options
P Chidley | Consultant | *7.35 9.49 | August 25, 2024 September 30, 2029 | 5,000 5,000
P Durham | Consultant | *7.35 9.49 | August 25, 2024 September 30, 2029 | 5,000 5,000
TOTAL | 20,000

* | The exercise price of CAD$9.30 per share was converted into a USD amount of $7.35 at the prevailing USD/CAD exchange rate at the date of grant (August 25, 2017).

In terms of the OEICP, the expiry of the options that expire in a closed period will be extended by 10 days from the cessation of the closed period.

F. Disclosure of Registrant’s Action to Recover Erroneously Awarded Compensation

The Company has adopted an incentive compensation recovery policy effective October 2, 2023 (“Incentive Compensation Recovery Policy”) as required by NYSE American listing rules and pursuant to Rule 10D-1 of the Exchange Act. The Incentive Compensation Recovery Policy is filed as Exhibit 97.1 to this Annual Report. At no time during or after the fiscal year ended December 31, 2023 (as of the date of this Annual Report), was the Company required to prepare an accounting restatement that required recovery of erroneously awarded compensation pursuant to the Incentive Compensation Recovery Policy and, as of December 31, 2023, there was no outstanding balance of erroneously awarded compensation to be recovered from the application of the Incentive Compensation Recovery Policy to a prior restatement.

ITEM 7 - MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. Major Shareholders

To the best of Caledonia's knowledge, as at April 26, 2024, we are aware of the following beneficial owners that directly or indirectly exercise control or direction over more than 5% of the voting rights to our shares.

| 2021 | 2022 | 2023
Beneficial owner name | Number of Shares Held | Percentage of Issued Shares | Number of Shares Held | Percentage of Issued Shares | Number of Shares Held | Percentage of Issued Shares
Toziyana Resource Limited | - | - | 2,411,186 | 12.56% | 2,411,186 | 12.56%
Shining Capital Holding II L.P. | - | - | 1,922,858 | 10.02% | 1,922,858 | 10.02%
Allan Gray (through two of its funds) | 1,957,391 | 15.34% | 2,180,070 | 11.36% | 1,149,945 | 5.99%

All shareholders have the same voting rights as all other shareholders of Caledonia.

There are no restrictions on the transfer of Caledonia’s issued shares.

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According to our share register and information received from our registrar on April 26, 2024 the shares of Caledonia (including those represented by depositary interests and receipts) were held in the following geographic locations:

Geographic Location based on the share register only |  | Number of Shares Held |  |  | Percentage of Issued Shares |
United Kingdom |  |  | 10,194 |  |  |  | 0.02 | %
USA |  |  | 17,065,645 |  |  |  | 84.45 | %
Canada |  |  | 4,819 |  |  |  | 0.03 | %
Zimbabwe |  |  | 1,049,554 |  |  |  | 5.46 | %
Other |  |  | 1,064,648 |  |  |  | 10.04 | %
|  |  | 19,194,860 |  |  |  | 100 | %

19,194,860 shares of the Company, as on April 26, 2024, are held by a total of 74 registered shareholders, including 46 registered holders in the United States.

Caledonia is not aware of any arrangement which may at some subsequent date result in a change of control of Caledonia.

B. Related Party Transactions

No related party transactions exist, other than disclosed in note 36 of the Consolidated Financial Statements.

C. Interests of Experts and Counsel

Not applicable.

ITEM 8 - FINANCIAL INFORMATION

A. Consolidated Statements and Other Financial Information

This Annual Report contains the audited Consolidated Financial Statements which comprise of the consolidated statements of financial position as at December 31, 2023 and December 31, 2022 and the related consolidated statements of profit or loss and other comprehensive income, consolidated statements of changes in equity and consolidated statements of cash flows for the years ended December 31, 2023, December 31, 2022 and December 31, 2021.

Reference is made to the Consolidated Financial Statements, including the report of the independent registered public accounting firm, BDO South Africa Inc. (PCAOB ID 1368), that are filed as part of this Annual Report on pages F1 – F78

Legal Proceedings and Regulatory Actions

To our knowledge, there are no legal proceedings material to us to which we are or were a party to or of which any of our properties are or were the subject of during the financial year ended December 31, 2023 nor are there any such proceedings known to us to be contemplated which would materially impact our financial position or ability to continue as a going concern.

During the twelve months ended December 31, 2023, there were no (i) penalties or sanctions imposed against us by a court relating to securities legislation or by a securities regulatory authority; (ii) penalties or sanctions imposed by a court or regulatory body against us that would likely be considered important to a reasonable investor in making an investment decision, or (iii) settlement agreements we entered into before a court relating to securities legislation or with a securities regulatory authority.

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Dividend policy

From 2014, the Company has paid a quarterly dividend (payable at the end of January, April, July and October each year, except for the dividend expected to be paid in April 2020 which was delayed by a month due to uncertainties related to the COVID-19 pandemic and dividends declared on December 30, 2022). The quarterly dividend declared from 2021 is set out below:

Declaration date | cents per share
January 14, 2021 | 11.0
April 15, 2021 | 12.0
July 15, 2021 | 13.0
October 14, 2021 | 14.0
January 13, 2022 | 14.0
April 18, 2022 | 14.0
July 14, 2022 | 14.0
October 13, 2022 | 14.0
December 30, 2022 | 14.0
April 3, 2023 | 14.0
June 29, 2023 | 14.0
September 28, 2023 | 14.0
January 2, 2023 | 14.0
March 27, 2024 | 14.0

B. Significant Changes

We have not experienced any significant changes since the date of the Consolidated Financial Statements included with this Annual Report except as disclosed in this Annual Report.

ITEM 9 - THE OFFERING AND LISTING

A. Offering and Listing Details

The Company’s shares trade on the NYSE American, AIM (in the form of depositary interests) and VFEX (in the form of depositary receipts) under the trading symbol “CMCL”. Caledonia voluntary delisted its shares from the TSX on June 19, 2020. After the delisting the Company remains a Canadian reporting issuer and has to comply with Canadian securities laws unless and until it can demonstrate that less than 2% of its beneficial shareholders are Canadian residents.

B. Plan of Distribution

Not applicable.

C. Markets

The Company’s shares trade on the NYSE American, AIM (in the form of depositary interests) and VFEX (in the form of depositary receipts) under the trading symbol “CMCL”. Caledonia voluntary delisted its shares from the TSX on June 19, 2020. After the delisting the Company remains a Canadian reporting issuer and has to comply with Canadian securities laws unless and until it can demonstrate that less than 2% of its beneficial shareholders are Canadian residents.

D. Selling Shareholders

Not applicable.

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E. Dilution

Not applicable.

F. Expenses of the Issue

Not applicable.

ITEM 10 - ADDITIONAL INFORMATION

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

Securities Registrar

Computershare Inc. is the transfer agent and registrar for the shares at its principal office in Massachusetts. Computershare Investor Services PLC at its principal office in Bristol, United Kingdom is the transfer agent for the depositary interests. Corpserve Registrars (Pvt) Limited at its principal office in Harare, Zimbabwe is the registrar for the depositary receipts.

Director’s power to vote on a proposal, arrangement or contract in which the director is materially interested.

An interested director must disclose to the Company the nature and extent of any interest in a transaction with the Company, or one of its subsidiaries, which to a material extent conflicts or may conflict with its interests and of which the director is aware. Failure to disclose an interest entitles the Company or a shareholder to apply to the court for an order setting aside the transaction concerned and directing that the director account to the Company for any profit.

A transaction is not voidable and a director is not accountable notwithstanding a failure to disclose an interest if the transaction is confirmed by special resolution and the nature and extent of the director’s interest in the transaction are disclosed in reasonable detail in the notice calling the meeting at which the resolution is passed.

Although it may still order that a director account for any profit, a court will not set aside a transaction unless it is satisfied that the interests of third parties who have acted in good faith would not thereby be unfairly prejudiced and the transaction was not reasonable and fair in the Company’s interests at the time it was entered into.

Except as otherwise provided in the Articles (as defined below) and save in respect of a limited number of instances as set out in the Articles, a director shall not vote on, or be counted in the quorum in relation to, any resolution of the board or of a committee of the board concerning any matter in which he has to his knowledge, directly or indirectly, an interest (other than his interest in shares or debentures or other securities of, or otherwise in or through, the Company) or duty which (together with any interest of a person connected with him) is material and, if he shall do so, his vote shall not be counted.

Directors’ power, in the absence of an independent quorum, to vote compensation to themselves or any members of their body.

The compensation of the directors is decided by the directors unless the Board of Directors specifically requests approval of the compensation from the shareholders. If the issuance of compensation to the directors is decided by the directors, a quorum is the majority of the directors in office. The Articles do not require that the compensation of any director be approved by disinterested directors.

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The Company has a compensation committee that is currently composed of three independent directors. The compensation committee makes recommendations to the board with respect to compensation, including bonuses, incentive stock options and securities of directors and executive officers.

Borrowing powers exercisable by the directors and how such borrowing powers may be varied.

The board may exercise all the Company’s powers to borrow money, to guarantee, to indemnify and to mortgage or charge all or any part of the Company’s undertaking, property and assets (present and future) and uncalled capital and, subject to the Companies Law to issue debentures and other securities, whether outright or as collateral security, for any debt, liability or obligation of the Company or of any third party.

The board shall restrict the Company’s borrowings and exercise all voting and other rights or powers of control exercisable by the Company in relation to its subsidiary undertakings (if any) to secure (but as regards subsidiary undertakings only in so far as by the exercise of such rights or powers of control the board can secure) that the aggregate principal amount from time to time outstanding of all borrowings by the Company’s group (exclusive of borrowings owing by one member of the Company’s group to another member of the Company’s group) shall not at any time without the previous sanction of an ordinary resolution of the Company exceed an amount equal to three times the Adjusted Capital and Reserves (as defined in the Articles). The borrowing powers may be varied by amendment to the Articles which requires approval of the Company’s shareholders by special resolution, being a resolution passed by at least 2/3 majority of the votes cast on the resolution.

Retirement and non-retirement of directors under an age limit requirement.

There are no such provisions applicable to the Company under the Articles or the Companies Law.

Number of shares required for a director’s qualification.

Under the Articles, the directors are not required to hold any shares as qualification for service on the board.

Place of Incorporation and Purpose

The Company was incorporated, effective February 5, 1992, by the amalgamation of three predecessor companies. It was registered in terms of the Canada Business Corporations Act. The company re-domiciled to Jersey, Channel Islands, effective March 19, 2016 through the Continuance process. The Continuance had no appreciable effect on the Company’s listing in Toronto, the admission of its depositary interests to trading on AIM in London or the trading facility on the OTCQX (from July 27, 2017 the OTCQX trading ceased and shares commenced trading on NYSE American) and the Company’s securities continued to be traded on these listing and trading platforms after the Continuance process was completed. Caledonia voluntary delisted its shares from the TSX on June 19, 2020. It subsequently listed depositary receipts on the Victoria Falls Stock Exchange on December 2, 2021.

Neither the Company’s memorandum of association nor the Articles stipulate any objects or purposes of the Company and no objects or purposes are required to be stated by the Companies Law.

Articles of Association

At a special meeting of shareholders held on February 18, 2016, Caledonia’s shareholders voted in favor of a resolution to approve the Continuance. This resolution, inter alia, included provisions to replace Caledonia’s by-laws with new articles of association (the “Articles”). The Articles do not place any restrictions on the Company’s business.

The holders of the shares are entitled to one vote per share at all meetings of the shareholders of the Company. The holders of shares are also entitled to dividends, if and when declared, and the distribution of the residual assets of the Company in the event of a liquidation, dissolution or winding up of the Company. The Company's shares do not have pre-emptive rights to purchase additional shares.

105

No preference shares are currently issued and outstanding. Preference shares may be issued from time to time in one or more series composed of such number of shares with such preference, deferred or other special rights, privileges, restrictions and conditions as specified in the Articles or as fixed before such issuance by a resolution passed by the directors and confirmed and declared by shareholders by a special resolution. The preference shares shall be entitled to preference over shares in respect of the payment of dividends and shall have priority over other shares in the event of a distribution of residual assets of the Company in the event of a liquidation, dissolution or winding up of the Company. The rights attached to the shares or the preference shares can only be modified by the affirmative vote of at least two-thirds of the votes cast at a meeting of the relevant shareholders called for that purpose.

Meetings of Shareholders

The Articles require the Company to call an annual general meeting of shareholders within 13 months after holding the last preceding annual general meeting and permits the Company to call any other meeting of shareholders at any time. The Company is required to mail a notice of meeting and management information circular to registered shareholders not less than 21 clear days and not more than 60 days prior to the date of any annual or other general meeting of shareholders, although it currently utilizes the notice and access method under Canadian law. These materials must also be filed with Canadian securities regulatory authorities. The Articles provide that a quorum of two shareholders in person or represented by proxy holding or representing by proxy not less than 5% of the Company’s issued shares carrying the right to vote at the meeting is required to transact business at a general meeting. Shareholders, and their duly appointed proxies and corporate representatives, as well as the Company's auditors, are entitled to be admitted to the Company's annual and other general meetings of shareholders.

Limitations on the Right to Own Securities

There are no limitations on the rights to own securities in the Company.

Limitations on Restructuring

There is no provision in the Articles that would have the effect of placing any limitations on any corporate restructuring in addition to what would otherwise be required by applicable law.

Disclosure of Share Ownership

The Articles permit the Company to give a disclosure notice to any person that the Company has reasonable cause to believe is/was interested in the Company’s shares within the preceding three years; such notice may require the person to inform the Company whether that person holds/has held an interest in the Company’s shares. The Articles also incorporate by reference certain of the disclosure guidance and transparency rules (“DTR”) published by the UK's Financial Conduct Authority. The DTR include, inter alia, a requirement that a shareholder must notify the Company of the percentage of its voting rights (held directly and indirectly) if the percentage of those voting rights reaches, exceeds or falls below 3% of the Company’s issued voting securities and each 1% threshold above 3%.

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Differences in Corporate Law between United States (Delaware) and Jersey, Channel Islands

Set forth below is a comparison of certain shareholder rights and corporate governance matters under Delaware law and Jersey law:

Corporate Law Issue | Delaware Law | Jersey Law
Special Meetings of Shareholders | Shareholders generally do not have the right to call meetings of shareholders unless that right is granted in the certificate of incorporation or by-laws. However, if a corporation fails to hold its annual meeting within a period of 30 days after the date designated for the annual meeting, or if no date has been designated for a period of 13 months after its last annual meeting, the Delaware Court of Chancery may order a meeting to be held upon the application of a shareholder. | Shareholders holding 10% or more of the company’s voting rights and entitled to vote at the relevant meeting may legally require directors to call a meeting of shareholders. Under the Articles, the percentage required to requisition a meeting is reduced to 5%. The Jersey Financial Services Commission, or JFSC, may, at the request of any officer, secretary or shareholder, call or direct the calling of an annual general meeting. Failure to call an annual general meeting in accordance with the requirements of the Companies Law is a criminal offense on the part of a Jersey company and its directors and secretary.
Interested Director Transactions | Interested director transactions are permissible and may not be legally voided if: ● either a majority of disinterested directors, or a majority in interest of holders of shares of the corporation’s capital stock entitled to vote upon the matter, approves the transaction upon disclosure of all material facts; or ● the transaction is determined to have been fair as to the corporation as of the time it is authorized, approved or ratified by the board of directors, a committee thereof or the shareholders. | An interested director must disclose to the company the nature and extent of any interest in a transaction with the company, or one of its subsidiaries, which to a material extent conflicts or may conflict with the interests of the company and of which the director is aware. Failure to disclose an interest entitles the company or a shareholder to apply to the court for an order setting aside the transaction concerned and directing that the director account to the company for any profit. A transaction is not voidable and a director is not accountable notwithstanding a failure to disclose an interest if the transaction is confirmed by special resolution and the nature and extent of the director’s interest in the transaction are disclosed in reasonable detail in the notice calling the meeting at which the resolution is passed. Although it may still order that a director account for any profit, a court will not set aside a transaction unless it is satisfied that the interests of third parties who have acted in good faith would not thereby be unfairly prejudiced and the transaction was not reasonable and fair in the interests of the company at the time it was entered into. The Articles set out a limited number of transactions and matters in which a director may be interested and in which he may vote and be counted in the quorum in relation to a resolution on the matter.

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Corporate Law Issue | Delaware Law | Jersey Law
Cumulative Voting | The certificate of incorporation of a Delaware corporation may provide that shareholders of any class or classes or of any series may vote cumulatively either at all elections or at elections under specified circumstances. | There are no provisions in the Companies Law relating to cumulative voting.
Approval of Corporate Matters by Written Consent | Unless otherwise specified in a corporation’s certificate of incorporation, shareholders may take action permitted to be taken at an annual or special meeting, without a meeting, notice or a vote, if consents, in writing, setting forth the action, are signed by shareholders with not less than the minimum number of votes that would be necessary to authorize the action at a meeting. All consents must be dated and are only effective if the requisite signatures are collected within 60 days of the earliest dated consent delivered. | If permitted by the articles of association of a company, a written consent signed and passed by the specified majority of members may affect any matter that otherwise may be brought before a shareholders’ meeting, except for the removal of a company’s auditors. Such consent shall be deemed effective when the instrument, or the last of several instruments, is signed by the specified majority of members or on such later date as is specified in the resolution. The Articles do not contain provisions regarding shareholder resolutions in writing.
Business Combinations | With certain exceptions, a merger, consolidation or sale of all or substantially all of the assets of a Delaware corporation must be approved by the board of directors and a majority of the outstanding shares entitled to vote thereon. | A sale or disposal of all or substantially all the assets of a Jersey company must be approved by the board of directors and, only if the articles of association of the company require, by the shareholders in general meeting. A merger involving a Jersey company must be generally documented in a merger agreement which must be approved by special resolution of that company.

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Corporate Law Issue | Delaware Law | Jersey Law
Limitations on Director’s Liability and Indemnification of Directors and Officers | A Delaware corporation may indemnify a director or officer of the corporation against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in defense of an action, suit or proceeding by reason of his or her position if (i) the director or officer acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and (ii) with respect to any criminal action or proceeding, the director or officer had no reasonable cause to believe his or her conduct was unlawful. | The Companies Law does not contain any provision permitting Jersey companies to limit the liabilities of directors for breach of fiduciary duty. However, a Jersey company may exempt from liability, and indemnify directors and officers, for liabilities: ● incurred in defending any civil or criminal legal proceedings where: ● the person is either acquitted or receives a judgment in their favor; ● where the proceedings are discontinued other than by reason of such person (or someone on their behalf) giving some benefit or suffering some detriment; or ● where the proceedings are settled on terms that such person (or someone on their behalf) gives some benefit or suffers some detriment but in the opinion of a majority of the disinterested directors, the person was substantially successful on the merits in the person’s resistance to the proceedings; ● incurred to anyone other than to the company if the person acted in good faith with a view to the best interests of the company; ● incurred in connection with an application made to the court for relief from liability for negligence, default, breach of duty or breach of trust under Article 212 of the Companies Law in which relief is granted to the person by the court; or ● incurred in a case in which the company normally maintains insurance for persons other than directors.

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Corporate Law Issue | Delaware Law | Jersey Law
Appraisal Rights | A shareholder of a Delaware corporation participating in certain major corporate transactions may, under certain circumstances, be entitled to appraisal rights under which the shareholder may receive cash in the amount of the fair value of the shares held by that shareholder (as determined by a court) in lieu of the consideration the shareholder would otherwise receive in the transaction. | There are no appraisal rights under the Companies Law but the Articles include dissent rights of shareholders, based on Canadian law, whereby shareholders who dissent to certain transactions of the Company may apply to have the Company buy their shares for fair value.
Shareholder Suits | Class actions and derivative actions generally are available to the shareholders of a Delaware corporation for, among other things, breach of fiduciary duty, corporate waste and actions not taken in accordance with applicable law. In such actions, the court has discretion to permit the winning party to recover attorneys’ fees incurred in connection with such action. | Under Article 141 of the Companies Law, a shareholder may apply to court for relief on the ground that the conduct of a company’s affairs, including a proposed or actual act or omission by a company, is “unfairly prejudicial” to the interests of shareholders generally or of some part of shareholders, including at least the shareholder making the application. There may also be customary law personal actions available to shareholders. Under Article 143 of the Companies Law (which sets out the types of relief a court may grant in relation to an action brought under Article 141 of the Companies Law), the court may make an order regulating the affairs of a company, requiring a company to refrain from doing or continuing to do an act complained of, authorizing civil proceedings and providing for the purchase of shares by a company or by any of its other shareholders.
Inspection of Books and Records | All shareholders of a Delaware corporation have the right, upon written demand, to inspect or obtain copies of the corporation’s shares ledger and its other books and records for any purpose reasonably related to such person’s interest as a shareholder. | The register of shareholders and books containing the minutes of general meetings or of meetings of any class of shareholders of a Jersey company must during business hours be open to the inspection of a shareholder of the company without charge. The register of directors and secretaries must during business hours (subject to such reasonable restrictions as the company may by its articles of association or in general meeting impose, but so that not less than two hours in each business day be allowed for inspection) be open to the inspection of a shareholder or director of the company without charge.

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Corporate Law Issue | Delaware Law | Jersey Law
Amendments to Charter | Amendments to the certificate of incorporation of a Delaware corporation generally require the affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon or such greater vote as is provided for in the certificate of incorporation, subject to certain exceptions under Delaware law. A provision in the certificate of incorporation requiring the vote of a greater number or proportion of the directors or of the holders of any class of shares than is required by Delaware corporate law may not be amended, altered or repealed except by such greater vote. | The memorandum of association and the articles of association of a Jersey company may only be amended by special resolution (being a two-thirds majority if the articles of association of the company do not specify a greater majority) passed by shareholders in general meeting or by written resolution signed by all the shareholders entitled to vote.
Blank Check Preferred Stock/Shares | Under Delaware law, the certificate of incorporation of a corporation may give the board the right to issue new classes of preferred shares with voting, conversion, dividend distribution, and other rights to be determined by the board at the time of issuance, which could prevent a takeover attempt and thereby preclude shareholders from realizing a potential premium over the market value of their shares. In addition, Delaware law does not prohibit a corporation from adopting a shareholder rights plan, or “poison pill,” which could prevent a takeover attempt and also preclude shareholders from realizing a potential premium over the market value of their shares. | The UK’s Takeover Code requires a target company shareholders' consent in general meeting before the target company can take any action (other than seeking alternative bids) that may result in the frustration of a takeover bid. Moreover, the Takeover Code provides that the board of directors of an offeree company must act in the interests of the company as a whole and must not deny the holders of securities the opportunity to decide on the merits of a takeover bid.

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Corporate Law Issue | Delaware Law | Jersey Law
Distributions and Dividends; Repurchases and Redemptions | Under Delaware law, subject to any restrictions contained in the certificate of incorporation, a corporation may pay dividends out of capital surplus or, if there is no surplus, out of net profits for the current and/or the preceding fiscal year in which the dividend is declared, as long as the amount of capital of the corporation following the declaration and payment of the dividend is not less than the aggregate amount of the capital represented by issued and outstanding shares having a preference upon the distribution of assets. Surplus is defined in Delaware law as the excess of the net assets over capital, as such capital may be adjusted by the board. A Delaware corporation may purchase or redeem shares of any class except when its capital is impaired or would be impaired by the purchase or redemption, and it may not purchase, for more than the price at which they may be redeemed, any of its shares which are redeemable at the option of the corporation. A corporation may, however, purchase or redeem out of capital shares that are entitled upon any distribution of its assets to a preference over another class or series of its shares if the shares are to be retired and the capital reduced. | Under the Companies Law, a Jersey company may make a distribution at any time and out of any source provided that the directors of the company who authorize the distribution make an immediate and 12 month forward looking cash-flow solvency statement. Likewise, authorizing directors must also make a solvency statement in the event of redeeming or purchasing the company’s shares. The Companies Law allows a Jersey company to purchase its own shares, whether they are redeemable or not, provided that the purchase is sanctioned by a special resolution. The monies payable on the redemption of redeemable shares or on the purchase of its own shares by a Jersey company may be funded from any source, including capital, provided that such shares are fully paid. If shares are to be purchased other than on a stock exchange, they may only be purchased pursuant to a contract approved in advance by an ordinary resolution of the company and they shall not carry the right to vote on the resolution sanctioning the purchase or approving the contract. If shares are to be purchased on a stock exchange, the resolution authorizing the purchase must specify the maximum number of shares to be purchased; the maximum and minimum prices which may be paid; and the date (not being later than 5 years after the passing of the resolution) on which the authority to purchase is to expire.

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C. Material Contracts

Material contracts include the documents at exhibits 4.13 to 4.15 (agreement for the sale and purchase of the share capital of Bilboes Gold Limited (as amended) and net smelter returns royalty deed in respect of the acquisition of Bilboes Gold Limited), exhibits 4.16 to 4.17 (share purchase agreement between Bulawayo Mining Company Limited and the Company in respect of the acquisition of Motapa Mining Company UK Limited and related loan note instrument) and 4.19 (placing agreement in respect of the recent placing of 1,207,514 new securities during March and April 2023). For further details of the contracts, please refer to the exhibits and the disclosures in this Annual Report relating to the acquisitions of Bilboes and Motapa and the recent placing.

D. Exchange Controls

There are no governmental laws, decrees or regulations existing in Jersey, Channel Islands, which restrict the export or import of capital, or the remittance of dividends, interest or other payments to non-resident holders of Caledonia's securities, nor does Jersey, Channel Islands have foreign exchange currency controls. Exchange control approvals from the RBZ and the Reserve Bank of South Africa are required on the flow of funds in and out of Zimbabwe and South Africa; Caledonia obtained the necessary approvals from the RBZ and the Reserve Bank of South Africa to transfer foreign currency during 2023.

E. Taxation

Certain United States Federal Income Tax Considerations

The following is a general summary of certain material U.S. federal income tax considerations applicable to a U.S. Holder (as defined below) arising from and relating to the acquisition, ownership, and disposition of shares. This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a U.S. Holder arising from and relating to the acquisition, ownership, and disposition of shares. In addition, this summary does not take into account the individual facts and circumstances of any particular U.S. Holder that may affect the U.S. federal income tax consequences to such U.S. Holder, including without limitation specific tax consequences to a U.S. Holder under an applicable income tax treaty. Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any U.S. Holder. This summary does not address the U.S. federal net investment income, U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and non-U.S. tax consequences to U.S. Holders of the acquisition, ownership, and disposition of shares. In addition, except as specifically set forth below, this summary does not discuss applicable tax reporting requirements. Each prospective U.S. Holder should consult its own tax advisor regarding the U.S. federal, U.S. federal net investment income, U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and non-U.S. tax consequences relating to the acquisition, ownership, and disposition of shares. No legal opinion from U.S. legal counsel or ruling from the Internal Revenue Service (the “IRS”) has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the acquisition, ownership, and disposition of shares. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the conclusions described in this summary.

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Scope of this Summary

Authorities

This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations (whether final, temporary, or proposed), published rulings of the IRS, published administrative positions of the IRS, and U.S. court decisions that are applicable and, in each case, as in effect and available, as of the date of this document. Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change could be applied on a retroactive or prospective basis which could affect the U.S. federal income tax considerations described in this summary. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive, current or prospective basis.

U.S. Holders

For purposes of this summary, the term "U.S. Holder" means a beneficial owner of shares that is for U.S. federal income tax purposes:

| ● | an individual who is a citizen or resident of the U.S.;

| ● | a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) organized under the laws of the U.S., any state thereof or the District of Columbia;

| ● | an estate whose income is subject to U.S. federal income taxation regardless of its source; or

| ● | a trust that (1) is subject to the primary supervision of a court within the U.S. and the control of one or more U.S. persons for all substantial decisions or (2) has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

U.S. Holders Subject to Special U.S. Federal Income Tax Rules Not Addressed

This summary does not address the U.S. federal income tax considerations applicable to U.S. Holders that are subject to special provisions under the Code, including, but not limited to, the following U.S. Holders that: (a) are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (b) are financial institutions, underwriters, insurance companies, real estate investment trusts, or regulated investment companies; (c) are broker-dealers, dealers, or traders in securities or currencies that elect to apply a mark-to-market accounting method; (d) have a “functional currency” other than the USD; (e) own shares as part of a straddle, hedging transaction, conversion transaction, constructive sale, or other integrated transaction; (f) acquired shares in connection with the exercise of employee stock options or otherwise as compensation for services; (g) hold shares other than as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment purposes); (h) are subject to the alternative minimum tax; (i) are partnerships and other pass-through entities (and investors in such partnerships and entities); (j) are S corporations (and shareholders or investors in such S corporations); (k) own, have owned or will own (directly, indirectly, or by attribution) 10% or more of the total combined voting power or value of the outstanding shares of the Company; (l) U.S. expatriates or former long-term residents of the U.S., (m) holds shares in connection with a trade or business, permanent establishment, or fixed base outside the United States, or (n) are subject to special tax accounting rules with respect to shares. U.S. Holders that are subject to special provisions under the Code, including, but not limited to, U.S. Holders described immediately above, should consult their own tax advisor regarding the U.S. federal, U.S. federal net investment income, U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and non-U.S. tax consequences relating to the acquisition, ownership and disposition of shares.

If an entity or arrangement that is classified as a partnership (or other “pass-through” entity) for U.S. federal income tax purposes holds shares, the U.S. federal income tax consequences to such entity and the partners (or other owners) of such entity generally will depend on the activities of the entity and the status of such partners (or owners). This summary does not address the tax consequences to any such owner. Partners (or other owners) of entities or arrangements that are classified as partnerships or as “pass-through” entities for U.S. federal income tax purposes should consult their own tax advisors regarding the U.S. federal income tax consequences arising from and relating to the acquisition, ownership, and disposition of shares.

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Ownership and Disposition of shares

The following discussion is subject in its entirety to the rules described below under the heading “Passive Foreign Investment Company Rules”.

Taxation of Distributions

A U.S. Holder that receives a distribution, including a constructive distribution, with respect to a share will be required to include the amount of such distribution in gross income as a dividend (without reduction for any foreign income tax withheld from such distribution) to the extent of the current or accumulated “earnings and profits” of the Company, as computed for U.S. federal income tax purposes. A dividend generally will be taxed to a U.S. Holder at ordinary income tax rates if the Company is a Passive Foreign Investment Company (“PFIC”) for the tax year of such distribution or the preceding year. To the extent that a distribution exceeds the current and accumulated “earnings and profits” of the Company, such distribution will be treated first as a tax-free return of capital to the extent of a U.S. Holder's tax basis in the shares and thereafter as gain from the sale or exchange of such shares (see “Sale or Other Taxable Disposition of Shares” below). However, the Company may not maintain the calculations of its earnings and profits in accordance with U.S. federal income tax principles, and each U.S. Holder may have to assume that any distribution by the Company with respect to the shares will constitute ordinary dividend income. Dividends received on shares by corporate U.S. Holders generally will not be eligible for the “dividends received deduction”. Subject to applicable limitations and provided the shares are readily tradable on a United States securities market, dividends paid by the Company to non-corporate U.S. Holders, including individuals, generally will be eligible for the preferential tax rates applicable to long-term capital gains for dividends, provided certain holding period and other conditions are satisfied, including that the Company not be classified as a PFIC (as defined below) in the tax year of distribution or in the preceding tax year. The dividend rules are complex, and each U.S. Holder should consult its own tax advisor regarding the application of such rules.

Sale or Other Taxable Disposition of Shares

A U.S. Holder will generally recognize gain or loss on the sale or other taxable disposition of shares in an amount equal to the difference, if any, between (a) the amount of cash plus the fair market value of any property received and (b) such U.S. Holder’s tax basis in such shares sold or otherwise disposed of. Any such gain or loss recognized on such sale or other disposition generally will be capital gain or loss, which will be long-term capital gain or loss if, at the time of the sale or other disposition, such shares are held for more than one year.

Preferential tax rates apply to long-term capital gains of a U.S. Holder that is an individual, estate, or trust. There are currently no preferential tax rates for long-term capital gains of a U.S. Holder that is a corporation. Deductions for capital losses are subject to significant limitations under the Code.

Passive Foreign Investment Company (“PFIC”) Rules

If the Company were to constitute a PFIC for any year during a U.S. Holder’s holding period, then certain potentially adverse rules would affect the U.S. federal income tax consequences to a U.S. Holder resulting from the acquisition, ownership and disposition of shares. The Company believes that it was not a PFIC for its most recently completed tax year. No opinion of legal counsel or ruling from the IRS concerning the status of the Company as a PFIC has been obtained or is currently planned to be requested. However, PFIC classification is fundamentally factual in nature, generally cannot be determined until the close of the tax year in question and is determined annually. Additionally, the analysis depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations. Consequently, there can be no assurance that the Company has never been and will not become a PFIC for any tax year during which U.S. Holders hold shares.

In addition, in any year in which the Company is classified as a PFIC, a U.S. Holder will be required to file an annual report with the IRS containing such information as Treasury Regulations and/or other IRS guidance may require. A failure to satisfy such reporting requirements may result in an extension of the time period during which the IRS can assess a tax. U.S. Holders should consult their own tax advisors regarding the requirements of filing such information returns under these rules, including the requirement to file an IRS Form 8621 annually.

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The Company generally will be a PFIC under Section 1297 of the Code if, after the application of certain “look-through” rules with respect to subsidiaries in which the Company holds at least 25% of the value of such subsidiary, for a tax year, (a) 75% or more of the gross income of the Company for such tax year is passive income (the “income test”) or (b) 50% or more of the value of the Company’s assets either produce passive income or are held for the production of passive income (the “asset test”), based on the quarterly average of the fair market value of such assets. “Gross income” generally includes all sales revenues less the cost of goods sold, plus income from investments and incidental or outside operations or sources, and “passive income” generally includes, for example, dividends, interest, certain rents and royalties, certain gains from the sale of stock and securities, and certain gains from commodities transactions. Active business gains arising from the sale of commodities generally are excluded from passive income if substantially all of a foreign corporation’s commodities are stock in trade or inventory, depreciable property used in a trade or business or supplies regularly used or consumed in the ordinary course of its trade or business, and certain other requirements are satisfied.

If the Company were a PFIC in any tax year during which a U.S. Holder held shares, such holder generally would be subject to special rules with respect to “excess distributions” made by the Company on the shares and with respect to gain from the disposition of shares. An “excess distribution” generally is defined as the excess of distributions with respect to the shares received by a U.S Holder in any tax year over 125% of the average annual distributions such U.S. Holder has received from the Company during the shorter of the three preceding tax years, or such U.S. Holder’s holding period for the shares. Generally, a U.S. Holder would be required to allocate any excess distribution or gain from the disposition of the shares ratably over its holding period for the shares. Such amounts allocated to the year of the disposition or excess distribution would be taxed as ordinary income, and amounts allocated to prior tax years would be taxed as ordinary income at the highest tax rate in effect for each such year and an interest charge at a rate applicable to underpayments of tax would apply.

While there are U.S. federal income tax elections that sometimes can be made to mitigate these adverse tax consequences (including the “QEF Election” under Section 1295 of the Code and the “Mark-to-Market Election” under Section 1296 of the Code), such elections are available in limited circumstances and must be made in a timely manner.

U.S. Holders should be aware that, for each tax year, if any, that the Company is a PFIC, the Company can provide no assurances that it will satisfy the record-keeping requirements of a PFIC, or that it will make available to U.S. Holders the information such U.S. Holders require to make a QEF Election with respect to the Company or any subsidiary that also is classified as a PFIC.

Certain additional adverse rules may apply with respect to a U.S. Holder if the Company is a PFIC, regardless of whether the U.S. Holder makes a QEF Election. These rules include special rules that apply to the amount of foreign tax credit that a U.S. Holder may claim on a distribution from a PFIC. Subject to these special rules, foreign taxes paid with respect to any distribution in respect of stock in a PFIC are generally eligible for the foreign tax credit. U.S. Holders should consult their own tax advisors regarding the potential application of the PFIC rules to the ownership and disposition of shares, and the availability of certain U.S. tax elections under the PFIC rules.

Additional Considerations

Receipt of Foreign Currency

The amount of any distribution paid to a U.S. Holder in foreign currency, or payment received on the sale, exchange or other taxable disposition of shares, generally will be equal to the USD value of such foreign currency based on the exchange rate applicable on the date of receipt (regardless of whether such foreign currency is converted into USD at that time). A U.S. Holder will have a basis in the foreign currency equal to its USD value on the date of receipt. Any U.S. Holder who converts or otherwise disposes of the foreign currency after the date of receipt may have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U.S. source income or loss for foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual method with respect to foreign currency received upon the sale, exchange or other taxable disposition of the shares. Each U.S. Holder should consult its own U.S. tax advisor regarding the U.S. federal income tax consequences of receiving, owning, and disposing of foreign currency.

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Foreign Tax Credit

Dividends paid on the shares will be treated as foreign-source income, and generally will be treated as “passive category income” or “general category income” for U.S. foreign tax credit purposes. The Code applies various complex limitations on the amount of foreign taxes that may be claimed as a credit by U.S. taxpayers. In addition, Treasury Regulations that apply to taxes paid or accrued (the “Foreign Tax Credit Regulations”) impose additional requirements for non-U.S. withholding taxes to be eligible for a foreign tax credit, and there can be no assurance that those requirements will be satisfied. The Treasury Department has released guidance temporarily pausing the application of certain of the Foreign Tax Credit Regulations.

Subject to the PFIC rules and the Foreign Tax Credit Regulations, each as discussed above, a U.S. Holder that pays (whether directly or through withholding) foreign income tax with respect to dividends paid on the shares generally will be entitled, at the election of such U.S. Holder, to receive either a deduction or a credit for such foreign income tax. Generally, a credit will reduce a U.S. Holder’s U.S. federal income tax liability on a dollar-for-dollar basis, whereas a deduction will reduce a U.S. Holder’s income subject to U.S. federal income tax. This election is made on a year-by-year basis and applies to all foreign taxes paid (whether directly or through withholding) by a U.S. Holder during a year. The foreign tax credit rules are complex and involve the application of rules that depend on a U.S. Holder’s particular circumstances. Each U.S. Holder should consult its own U.S. tax advisor regarding the foreign tax credit rules.

Backup Withholding and Information Reporting

Under U.S. federal income tax law and Treasury Regulations, certain categories of U.S. Holders must file information returns with respect to their investment in, or involvement in, a foreign corporation. For example, U.S. return disclosure obligations (and related penalties) are imposed on individuals who are U.S. Holders that hold certain specified foreign financial assets in excess of certain threshold amounts. The definition of specified foreign financial assets includes not only financial accounts maintained in foreign financial institutions, but also, unless held in accounts maintained by a financial institution, any stock or security issued by a non-U.S. person, any financial instrument or contract held for investment that has an issuer or counterparty other than a U.S. person and any interest in a foreign entity. U.S. Holders may be subject to these reporting requirements unless their shares are held in an account at certain financial institutions. Penalties for failure to file certain of these information returns are substantial. U.S. Holders should consult their own tax advisors regarding the requirements of filing information returns, including the requirement to file an IRS Form 8938.

Payments made within the U.S. or by a U.S. payor or U.S. middleman, of dividends on, and proceeds arising from the sale or other taxable disposition of, shares will generally be subject to information reporting and backup withholding tax, currently at the rate of 24%, if a U.S. Holder (a) fails to furnish such U.S. Holder’s correct U.S. taxpayer identification number (generally on IRS Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS that such U.S. Holder has previously failed to properly report items subject to backup withholding tax, or (d) fails to certify, under penalty of perjury, that such U.S. Holder has furnished its correct U.S. taxpayer identification number and that the IRS has not notified such U.S. Holder that it is subject to backup withholding tax. However, certain exempt persons generally are excluded from these information reporting and backup withholding rules. Backup withholding is not an additional tax. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability, if any, or will be refunded, if such U.S. Holder furnishes required information to the IRS in a timely manner.

The discussion of reporting requirements set forth above is not intended to constitute a complete description of all reporting requirements that may apply to a U.S. Holder. A failure to satisfy certain reporting requirements may result in an extension of the time period during which the IRS can assess a tax, and under certain circumstances, such an extension may apply to assessments of amounts unrelated to any unsatisfied reporting requirement. Each U.S. Holder should consult its own tax advisor regarding the information reporting and backup withholding rules.

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THE ABOVE SUMMARY IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS OF ALL TAX CONSIDERATIONS APPLICABLE TO U.S. HOLDERS WITH RESPECT TO THE ACQUISITION, OWNERSHIP, AND DISPOSITION OF SHARES. U.S. HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX CONSIDERATIONS APPLICABLE TO THEM IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES.

F. Dividends and Paying Agents

Not applicable.

G. Statement by Experts

Not applicable.

H. Documents on Display

Any statement in this Annual Report about any of our contracts or other documents is not necessarily complete. If the contract or document is filed as an exhibit to this Annual Report, the contract or document is deemed to modify the description contained in this Annual Report. Readers must review the exhibits themselves for a complete description of the contract or document.

We are subject to the informational requirements of the Exchange Act and file reports and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC at http://www.sec.gov.

We are required to file reports and other information with the securities commissions in Canada. You are invited to read and copy any reports, statements or other information, other than confidential filings, that we file with the provincial securities commissions. These filings are also electronically available from the Canadian System for Electronic Document Analysis and Retrieval ("SEDAR") (www.sedar.com), the Canadian equivalent of the SEC's electronic document gathering and retrieval system.

Copies of our material contracts are kept at our registered office.

I. Subsidiary Information

Not applicable.

J. Annual Report to Security Holders

Not applicable

ITEM 11 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed in varying degrees to a variety of financial instrument related risks by virtue of its activities. The overall financial risk management program focuses on preservation of capital and protecting current and future Company assets and cash flows by reducing exposure to risks posed by the uncertainties and volatilities of financial markets.

The Board of Directors of the Company has a responsibility to ensure that an adequate financial risk management policy is established and to approve the policy. The Company’s Audit Committee oversees management’s compliance with the Company’s financial risk management policy.

The fair value of the Company’s financial instruments approximates their carrying value unless otherwise noted. The types of risk exposure and the way in which such exposures are managed are as follows:

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A. Currency Risk

The Group is exposed to currency risk on inter-company sales and purchases that are denominated in a currency other than the respective functional currencies of Group entities. The Group does not use financial instruments to hedge its exposure to currency risk. To reduce exposure to currency transaction risk, the Group regularly reviews the currency (i.e. RTGS$ or foreign currency) in which it spends its cash to identify and avoid specific expenditures in currencies that experience inflationary pressures. The Group aims to maintain cash and cash equivalents in US Dollars to manage foreign exchange exposure. The operating results and financial position of the Group are reported in USD in the Consolidated Financial Statements.

The availability of foreign exchange and the fluctuation of the USD in relation to other currencies that entities, within the Group, may transact in will consequently have an impact upon the profitability of the Group and may also affect the value of the Group’s assets and liabilities. As noted below, the Group has certain financial assets and liabilities denominated in currencies other than the functional currency of the Company. To reduce exposure to currency transaction risk, the Group regularly reviews the currency in which it spends its cash to identify and avoid specific expenditures in currencies that experience inflationary pressures. Further the Group aims to maintain cash and cash equivalents in USD to avoid foreign exchange exposure and to meet short‐term liquidity requirements.

B. Sensitivity Analysis

As a result of the Group’s monetary assets and liabilities denominated in foreign currencies which is different to the functional currency of the underlying entities, the profit or loss and equity in the underlying entities could be affected by movements between the functional currency and the foreign currency. The table below indicates consolidated monetary assets/ (liabilities) in the Group that have a different functional currency and foreign currency.

|  | 2023 |  |  | 2022 |  |  | 2021 |
|  | $'000 |  |  | $'000 |  |  | $'000 |
|  | Functional currency |  |  | Functional currency |  |  | Functional currency |
|  | ZAR |  |  | $ |  |  | ZAR |  |  | $ |  |  | ZAR |  |  | $ |
Cash and cash equivalents |  |  | 62 |  |  |  | 4,706 |  |  |  | 62 |  |  |  | 3,443 |  |  |  | 62 |  |  |  | 1,414 |
USD denominated |  |  | 61 |  |  |  | - |  |  |  | 62 |  |  |  | - |  |  |  | 61 |  |  |  | - |
ZAR denominated |  |  | - |  |  |  | 989 |  |  |  | - |  |  |  | 631 |  |  |  | - |  |  |  | 573 |
RTGS$ denominated |  |  | - |  |  |  | 3,424 |  |  |  | - |  |  |  | 2,502 |  |  |  | - |  |  |  | 259 |
GBP denominated |  |  | 1 |  |  |  | 293 |  |  |  | - |  |  |  | 235 |  |  |  | 1 |  |  |  | 426 |
CAD denominated |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 75 |  |  |  | - |  |  |  | 156 |
Trade and other receivables - RTGS$ denominated |  |  | - |  |  |  | 3,118 |  |  |  | - |  |  |  | 2,607 |  |  |  | - |  |  |  | 2,293 |
Trade and other payables - RTGS$ denominated |  |  | - |  |  |  | (106 | ) |  |  | - |  |  |  | (130 | ) |  |  | - |  |  |  | (166 | )
Overdraft and term loans - RTGS$ denominated |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 62 |  |  |  | 7,718 |  |  |  | 62 |  |  |  | 5,920 |  |  |  | 62 |  |  |  | 3,541 |

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A reasonably possible strengthening or weakening of 5% of the various functional currencies against the foreign currencies would have the following equal or opposite effect on profit or loss before tax for the Group:

|  | 2023 $’000 |  |  | 2022 $’000 |  |  | 2021 $’000 |
|  | Functional currency |  |  | Functional currency |  |  | Functional currency |
|  | ZAR |  |  | USD |  |  | ZAR |  |  | USD |  |  | ZAR |  |  | USD |
Cash and cash equivalents |  |  | 3 |  |  |  | 177 |  |  |  | 3 |  |  |  | 134 |  |  |  | 3 |  |  |  | 67 |
Trade and other receivables |  |  | - |  |  |  | 148 |  |  |  | - |  |  |  | 124 |  |  |  | - |  |  |  | 109 |
Trade and other payables |  |  | - |  |  |  | (5 | ) |  |  | - |  |  |  | (6 | ) |  |  | - |  |  |  | (8 | )
Overdraft |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 3 |  |  |  | 320 |  |  |  | 3 |  |  |  | 252 |  |  |  | 3 |  |  |  | 168 |

C. Concentration of Credit Risk

Credit risk is the risk of a financial loss to the Company if a debtor fails to meet its contractual obligation. From 2014, gold sales were made to Fidelity in Zimbabwe and the payment terms stipulated in the service delivery contract have been adhered to in all instances. 75% of the portion of unrefined metals produced by Blanket and exported by Caledonia to AEG, from April of 2023 on the toll refinement basis. Trade and other receivables are detailed in note 21 to the Consolidated Financial Statements and include $5.4 million (December 31, 2022: $7.4 million, December 31, 2021: $4.5 million) due from Fidelity and AEG in respect of the RTGS$ and USD components respectively of the revenues arising on gold deliveries prior to the close of business on December 31, 2023. All outstanding amounts due from Fidelity and AEG were received in full after the end of the 2023 year. $3.8 million (December 31, 2022: $1 million, December 31, 2021: $3.2 million) was due from the Zimbabwe Government in respect of VAT refunds. The amount due in respect of VAT refunds mainly comprises RTGS$-denominated VAT refunds. Increased delays in the processing of VAT refunds by the Government of Zimbabwe has resulted in an increase in the amount receivable in RTGS$ terms. The long-outstanding balances have either been repaid after the end of the Year or have been recovered by way of offset against other tax payables due to the Government of Zimbabwe.

D. Liquidity Risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group manages its liquidity risk by ensuring that there is enough cash to meet its likely cash requirements, after taking into account cash flows from operations and the Group’s holdings of cash and cash equivalents. The Group believes that these sources will be enough to cover the anticipated cash requirements. Senior management is also actively involved in the review and approval of planned expenditures by regularly monitoring cash flows from operations and anticipated investing and financing activities.

E. Market Risk - Interest Rate Risk

The Group's interest rate risk arises from loans and borrowings, overdraft facility and cash held. The loans and borrowings, overdraft facility and cash held have variable interest rate borrowings. Variable-rate borrowings expose the Group to cash flow interest rate risk. The Group has not entered into interest rate swap agreements and mitigates the interest rate risk by remaining in a positive consolidated net cash position.

The Group’s assets and (liabilities) exposed to interest rate fluctuations as at year-end are summarized as follows:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Cash and cash equivalents |  |  | 6,709 |  |  |  | 6,735 |  |  |  | 17,152 |
Overdraft |  |  | (17,740 | ) |  |  | (5,239 | ) |  |  | (887 | )

Interest rate risk arising is offset by available cash and cash equivalents. The table below summarizes the effect of a change in finance cost on the Group’s profit or loss and equity for the year, had the rates charged differed.

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|  | 2023 |  |  | 2022 |  |  | 2021 |
Sensitivity analysis – cash and cash equivalents |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | 67 |  |  |  | 67 |  |  |  | 172 |
Decrease in 100 basis points |  |  | (67 | ) |  |  | (67 | ) |  |  | (172 | )
Sensitivity analysis – overdraft |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | 177 |  |  |  | 52 |  |  |  | 9 |
Decrease in 100 basis points |  |  | (177 | ) |  |  | (52 | ) |  |  | (9 | )

F. Market Risk – Gold Price

The value of the Company’s mineral properties is related to the price of gold and the outlook for these minerals. In addition, adverse changes in the price of certain key or high cost operating consumables can significantly impair the Company’s cash flows.

Gold prices historically have fluctuated widely and are affected by numerous factors outside of the Company's control, including, but not limited to, industrial and retail demand, central bank lending, forward sales by producers and speculators, levels of worldwide production, short-term changes in supply and demand because of speculative hedging activities, and macro-economic variables, and certain other factors related specifically to gold.

The Group regularly monitors its market risk and evaluates the options available.

Sensitivity analysis

A reasonably possible strengthening (weakening) of the gold price will have an impact on the revenue of the Group and the fair value of the gold loan and call option at December 31, 2023. This would have affected the measurement of financial instruments by the amounts as indicated below. This analysis assumes that all other variables remain constant.

An increase or decrease of 5% of the gold price would have the following equal or opposite effect on the derivative financial instruments on December 31:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Consolidated statement of financial position: |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial liabilities - Gold loan |  |  |  |  |  |  |  |  |  |  |  |
Increase by 5% of the gold price |  |  | - |  |  |  | - |  |  |  | 143 |
Decrease by 5% of the gold price |  |  | - |  |  |  | - |  |  |  | (143 | )
Derivative financial liabilities - call option |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | - |  |  |  | - |  |  |  | 11 |
Decrease in 100 basis points |  |  | - |  |  |  | - |  |  |  | (11 | )
Derivative financial liabilities – put option |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | - |  |  |  | - |  |  |  | - |
Decrease in 100 basis points |  |  | 4 |  |  |  | 22 |  |  |  | - |

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|  | 2023 |  |  | 2022 |  |  | 2021 |
Consolidated statement of profit or loss and other comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial liabilities - Gold loan |  |  |  |  |  |  |  |  |  |  |  |
Increase by 5% of the gold price |  |  | - |  |  |  | - |  |  |  | 143 |
Decrease by 5% of the gold price |  |  | - |  |  |  | - |  |  |  | (143 | )
Derivative financial liabilities - call option |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | - |  |  |  | - |  |  |  | 11 |
Decrease in 100 basis points |  |  | - |  |  |  | - |  |  |  | (11 | )
Derivative financial liabilities – put option |  |  |  |  |  |  |  |  |  |  |  |
Increase in 100 basis points |  |  | - |  |  |  | - |  |  |  | - |
Decrease in 100 basis points |  |  | 4 |  |  |  | 22 |  |  |  | - |

The Group’s revenues had full exposure to the gold price up to March 2024 when the gold put option agreement was concluded (refer note 14.1 of the Consolidated Financial Statements). New put options were purchased in March 2024 to hedge 12,000 ounces of gold over a period of three months from January to March 2024 at a strike price of $1,950.

ITEM 12 - DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

A. to C.

Not Applicable.

D.

The Company does not have securities registered as American Depository Receipts.

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PART II

ITEM 13 - DEFAULTS, DIVIDEND ARREARS AND DELINQUENCIES

There has not been a material default in the payment of principal, interest, a sinking or purchase fund installment, or any other material default not cured within thirty days, relating to indebtedness of the Company or any of its significant subsidiaries. There are no payments of dividends by the Company in arrears, nor has there been any other material delinquency relating to any class of preference shares of the Company.

ITEM 14 - MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

A. to D.

None.

E. Use of Proceeds

Not applicable.

ITEM 15 - CONTROLS AND PROCEDURES

A. Disclosure Controls and Procedures

The Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) have evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures and assessed the design of the Company’s internal control over financial reporting as of December 31, 2023. As required by Rule 13(a)-15 under the Exchange Act, in connection with this Annual Report on Form 20-F, under the direction of our CEO and CFO, we have evaluated our disclosure controls and procedures as of December 31, 2023, and we have concluded our disclosure controls and procedures were effective as at December 31, 2023.

B. Management’s annual report on internal control over financial reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting has been designed to provide reasonable assurance with respect to the reliability of financial reporting and the presentation of financial statements for external purposes in accordance with IFRS. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected.

As of the date of this filing, we have in place controls and procedures to maintain appropriate segregation of duties in our manual and computer-based business processes that we believe are appropriate for a company of our size and extent of business transactions. Under the supervision and with the participation of the CEO and CFO, management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023. In making their assessment, management used the control objectives established in the 2013 Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) framework. Based upon that assessment and those criteria, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2023.

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C. Attestation report of registered public accounting firm

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm as we qualify as an "emerging growth company" under section 3(a) of the Exchange Act (as amended by the JOBS Act, enacted on April 5, 2012), and are therefore exempt from the attestation requirement.

D. Changes in internal controls over financial reporting

There were no changes in the Company’s internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of 17 CFR 240.13a-15 or 240.15d-15 that occurred during the period covered by this Annual Report that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting.

ITEM 16 - [RESERVED]

ITEM 16A - AUDIT COMMITTEE FINANCIAL EXPERT

The Board of Directors has determined that all four members of its Audit Committee are considered independent as defined under Canadian National Instrument 52-110 and as defined under Section 803 of the NYSE American LLC Company Guide and Exchange Act Rule 10A-3 (as such definitions may be modified or supplemented) and considered to be financially literate as such terms are defined under Canadian National Instrument 52-110, and two of the members can be considered to be financial experts as defined in Item 407(d)(5) of Regulation S-K under the Exchange Act. The financial experts serving on the Audit Committee are Mr. J. Holtzhausen and Ms. T. Gadzikwa, whose experience is disclosed in this Annual Report under Item 6.A “Directors and Senior Management”. Mr. J. Holtzhausen, Mr. G. Wylie, Ms. G. Wildschutt and Ms. T. Gadzikwa are all independent directors under the applicable rules.

The SEC has indicated that the designation of an audit committee financial expert does not make that person an "expert" for any purpose, impose any duties, obligations, or liability on that person that are greater than those imposed on members of the Audit Committee and Board of Directors who do not carry this designation, or affect the duties, obligations, or liabilities of any other member of the Audit Committee.

ITEM 16B - CODE OF ETHICS

On November 8, 2016 the registrant’s Board of Directors approved in principle, and the Company formally adopted on March 7, 2017, a revised code of business conduct, ethics and anti-bribery policy that applies to the registrant’s directors, CEO, CFO, principal accounting officer or controller, or persons performing similar functions, and all other employees and contractors. The code was further revised and the most recent updated version was adopted on November 10, 2020.

The text of this code is available on the Company’s website: (www.caledoniamining.com/index.php/aboutus/corporate-governance).

The Company has not granted any waiver from the Code of Ethics to the CEO, CFO, principal accounting officer or controller, or persons performing similar functions during the fiscal year ended December 31, 2023.

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ITEM 16C - PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table sets forth the aggregate fees billed by our external auditors, BDO South Africa Incorporated, Johannesburg, Gauteng, South Africa (PCAOB ID 1368), unless stated otherwise, for the years indicated:

|  | (1)(2)2023 |  |  | (1)(2)2022 |  |  | (1)(2)2021 |
Audit fees |  |  | 353,152 |  |  |  | 254,772 |  |  |  | 282,888 |
Audit – related fees |  |  | - |  |  |  | - |  |  |  | - |
Tax fees |  |  | - |  |  |  | - |  |  |  | - |
All other fees |  |  | - |  |  |  | 4,172 |  |  |  | 12,715 |
Total |  |  | 353,152 |  |  |  | 258,944 |  |  |  | 295,603 |

Notes:

(1) | Prior to the start of the audit process, Caledonia’s Audit Committee receives an estimate of the costs from its auditors and reviews such costs for their reasonableness. After their review and pre-approval of the fees, the Audit Committee recommends to the Board of Directors whether to accept the estimated audit fees given by the auditors.
(2) | Represents fees billed by BDO South Africa Incorporated

ITEM 16D - EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E - PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Not applicable.

ITEM 16F - CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT

None.

ITEM 16G - CORPORATE GOVERNANCE

Because our securities are listed on NYSE American, being a national securities exchange in the United States, we are subject to the corporate governance requirements set out in the NYSE American LLC Company Guide. We are also subject to a variety of corporate governance guidelines and requirements enacted by the jurisdictions and exchanges in which we operate our business and on which our securities are traded. We incorporate a mix of corporate governance best practices to ensure that our corporate governance complies in all material respects with the requirements of the jurisdictions in which we operate and the exchanges on which our securities are traded. The Company has also adopted the UK’s Quoted Companies Alliance Corporate Governance Code and discloses on its website how it satisfies the ten principles of the Code.

Section 110 of the NYSE American Company Guide permits NYSE American to consider the laws, customs and practices of foreign issuers, and to grant exemptions from NYSE American listing criteria based on these considerations. A company seeking relief under these provisions is required to provide a written certification from independent local counsel that the non-complying practice is not prohibited by home country law. A description of the significant ways in which the Company’s governance practices differ from those followed by domestic companies pursuant to NYSE American standards is as follows:

Shareholder Meeting Quorum Requirement: the NYSE American Company Guide specifies a quorum requirement of at least 33-1/3% of the shares issued and outstanding and entitled to vote for meetings of a listed company's shareholders. The Company's quorum requirements for shareholder meetings, as set forth in the Articles, are two members entitled to vote at the meeting present in person or by proxy together holding or representing by proxy not less than five percent of the issued shares of the Company. The Company's quorum requirement as set forth in the Articles is not prohibited by, and does not contravene, the Companies Law.

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Proxy Delivery Requirement: the NYSE American requires the solicitation of proxies and delivery of proxy statements for all shareholder meetings and requires that these proxies be solicited pursuant to a proxy statement that conforms to SEC proxy rules. The Company is a “foreign private issuer” as defined in Rule 3b-4 under the Exchange Act, and the equity securities of the Company are accordingly exempt from the proxy rules set forth in Sections 14(a), 14(b), 14(c) and 14(f) of the Exchange Act. The Company complies with the applicable rules and regulations in Jersey.

Shareholder Approval of Certain Transactions: Section 712(b) of the NYSE American Company Guide provides that shareholder approval is required for approval of applications to list additional shares when additional shares will be issued in connection with a transaction where the present or potential issuance of common stock, or securities convertible into common stock, could result in an increase in outstanding common shares of 20% or more. There is no equivalent Jersey statutory legal requirement for shareholder approval where the present or potential issuance of common stock, or securities convertible into common stock, could result in an increase in outstanding common shares of 20% or more, nor is an equivalent requirement imposed by the Company's articles of association. The Company complies with the applicable rules and regulations in Jersey.

In addition, the Company may from time-to-time seek relief from NYSE American corporate governance requirements on specific transactions under Section 110 of the NYSE American Company Guide by providing written certification from independent local counsel that the non-complying practice is not prohibited by our home country law, in which case, the Company shall make the disclosure of such transactions available on its website at http://www.caledoniamining.com. Information contained on the Company’s website is not part of this Form 20-F.

ITEM 16H - MINE SAFETY DISCLOSURE

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities with respect to mining operations and properties in the United States that are subject to regulation by the Federal Mine Safety and Health Administration ("MSHA") under the Federal Mine Safety and Health Act of 1977 (the "Mine Act"). During the year ended December 31, 2023, the Company had no mines in the United States that were subject to regulation by the MSHA under the Mine Act.

ITEM 16I - DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

ITEM 16J – INSIDER TRADING POLICIES

Not applicable.

ITEM 16K – CYBER SECURTIY

Risk management and strategy

The Company has an integrated cybersecurity risk management program for assessing, identifying, and managing risk from cybersecurity threats. Reporting on progress and performance of the cybersecurity risk management program is done regularly to the IT Steering Committee (comprised of senior management) and quarterly to the Board of Directors. The Chief Information Officer (“CIO”) is responsible for maintaining this program along with a skilled team of IT professionals. The Company’s policies and procedures related to the cybersecurity risk management program include the following:

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| ● | Disaster recovery plan (including a step-by-step data restore process). This includes disaster classification, critical systems and response times, recovery team and escalation procedures. The CIO is responsible for declaring an I.T. disaster in consultation with the CEO, COO or CFO, and will be required to instruct the IT team to implement recovery procedures. Recovery efforts will be led by the IT team in South Africa and Zimbabwe with the use of consultants where necessary.

All decisions are to be made by CIO, after consulting CEO, CFO and COO. Any formal communications to go through the Company’s formal PR process. The IT team in South Africa and Zimbabwe have the authority to make emergency decisions should the CIO not be reachable after consulting either the CEO, CFO or COO with regards to the matter. If a Cybersecurity Incident takes place, the Company’s Incident Response Plan (as defined below) will be implemented.

| ● | Incident response plan (“Incident Response Plan”) which sets out the following cybersecurity incident phases

| o | IDENTIFY
| o | ASSESS - INCIDENT RESPONSE TEAM ESTABLISHED
| o | RESPOND
| o | REMEDY AND RECOVERY
| o | REVIEW AND IMPROVEMENT
| o | CONFIDENTIALITY

| ● | Access control policy addressing physical and logical security requirements. This is implemented through formalized controls which are performed according to the control frequencies and tested regularly by internal and external assurance providers.

| ● | Isometrix system to report any cybersecurity incidents, materiality, impact, and sign off. This system is used to document any cybersecurity incidents and assess the impact thereof. The impact assessment includes qualitative and quantitative factors and external providers will be utilized to assist with the assessment should this be deemed necessary. This system will also drive escalations based on materiality and the incident will be reported accordingly. All incidents are reported to the IT Steering Committee immediately. After the assessment is performed, these will be reported to the Board if material. On a quarterly basis, Cybersecurity matters are reported to the Board with regards to controls and processes in place, any new developments, and also any actions to be taken to improve the environment.

Cybersecurity controls and procedures are formally documented using guidance from the National Institute of Standards and Technology Cybersecurity Framework and are assessed by third parties, external audits and internal audits on a regular basis. Examples of the Company’s cybersecurity controls and procedures include the following:

| ● | Bitdefender Gravity Zone to manage malware and vulnerabilities, including automated patch management.

| ● | Company-wide use of VPN for all remote access, multifactor authentication for all privileged accounts and firewalls with restricted access.

| ● | Cybersecurity training, awareness and phishing campaigns using the KNOWBE4 platform.

| ● | Review of all Active Directory accounts (Network accounts), including admin password changes, restricting of guest accounts, restricting access to use external storage devices (USB access) and restricting email access on mobile devices.

| ● | Outdated IT hardware is replaced frequently and detailed asset and network diagrams maintained.

| ● | Monitoring of privileged activities on AD and failed logins for administrative accounts and administrative activities on all SQL databases via the LOG360 Management Tool.

| ● | Third party access to all systems is restricted and strictly monitored as required. All third party activities are subject to the Company’s ITGC controls framework. Segregation of duties between Applications, Databases and Operating Systems for privileged users is strictly monitored.

| ● | The IT risk register is updated on a regular basis.

| ● | Reporting to the IT Steering Committee on all key IT related matters with quarterly reporting to the Board of Directors.

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While Caledonia has not, as of the date of this Annual Report, experienced a “cybersecurity threat” (as defined in Item 106(a) of Regulation S-K) or “cybersecurity incident” (as defined in Item 106(a) of Regulation S-K) that has materially affected or was reasonably likely to materially affect the Company, including our business strategy, results of operations, or financial condition, there can be no guarantee that we will not experience such a cybersecurity threat or cybersecurity incident in the future.

Governance

Board Oversight

Cybersecurity is a focus risk area for the Company, and the Board of Directors provides oversight on risks from cybersecurity threats. Key cybersecurity matters are discussed at a weekly senior management meeting and in regular IT Steering Committee meetings attended by the CEO, COO, CFO and CIO.

Cybersecurity, as part of the general IT ecosystem, is also reported quarterly to the Board of Directors, and, should a cybersecurity incident occur, the reporting of such cybersecurity incident will be in line with the Company’s Incident Response Plan.

Management’s Role

The CEO, CFO, CIO and COO, as part of the IT Steering Committee, and the General Counsel, as Head of Risk, are responsible for assessing and managing the Company’s cybersecurity risk, along with external advisors if necessary, and reporting to the Board of Directors.

The IT Steering Committee members have sufficient expertise (Finance, IT and Operational) to assess the risk related to a cybersecurity matter, along with experts in the IT team that will provide analysis on any security matters.

The CIO and her team are responsible for updating the Isometrix system which is used to record all cybersecurity incidents. Quarterly updates on cybersecurity are provided to the Board of Directors.

Engaging the Board on a cybersecurity incident:

The Board of Directors is notified once a cybersecurity incident is deemed material by the IT Steering Committee or the CIO.

Communication of cybersecurity performance to stakeholders:

Only material cybersecurity incidents are communicated to stakeholders in accordance with applicable rules (including SEC rules) and requirements. Any potentially material cybersecurity incidents are reported to the IT Steering Committee as required.

Quantification of our cybersecurity risk in financial terms is performed so that we can make informed decisions about risk mitigation and risk transfer as follows: cybersecurity quantification is performed as part of the Incident Response Plan – respond phase (qualitative and quantitative factors are taken into consideration bearing in mind, in particular, information that a reasonable investor would consider important in making an investment decision, and information that would alter the total mix of information made available).

As part of the quantification of our Cybersecurity risk, and in addition to financial impact, the Company evaluates the extent of potential damage in the event of a Cybersecurity incident and the risk to systems and privileged accounts in particular. The Company audits which privileged accounts are being used, whether any passwords have been changed, and what applications are being used. Any risks identified are assessed for materiality, including the consideration of qualitative factors, such as effects on reputation, customer relationships, vendor relationships and regulatory compliance. A third party assurance provider will be used to assist Caledonia with the quantification should this be deemed necessary by the IT Steering Committee.

128

Measurements to determine whether our investments in cybersecurity are reducing our risk in a cost-effective manner include: bi-annual cybersecurity risk assessments and penetration tests are performed by third party assurance providers.

129

PART III

ITEM 17 - FINANCIAL STATEMENTS

See Item 18.

ITEM 18 - FINANCIAL STATEMENTS

The Consolidated Financial Statements and schedules appear on pages F-1 through F-78 of this Annual Report and are incorporated herein by reference. Our audited financial statements as prepared by our management and approved by the Board of Directors include:

Consolidated Statements of Profit or Loss and Other Comprehensive Income

Consolidated Statements of Financial Position

Consolidated Statements of Changes in Equity

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

All the above statements are available on the Company’s website at www.caledoniamining.com or under the Company’s profile on the System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com

ITEM 19 - EXHIBITS

Financial Statements

Description |  | Page
Consolidated Financial Statements and Notes |  | F-1- F-78

Exhibit List

Exhibit No. | Name
1.1 | Articles of Association (incorporated herein by reference to Exhibit 1.1 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 4, 2016)
2.1 | Description of Registered Securities (incorporated herein by reference as Exhibit 2.1 of the Registrant’s Annual Report on Form 20-F filed with the SEC on March 29, 2021)
2.2 | Loan Note Instrument up to US$7,250,000 guaranteed loan notes 2022 (Motapa) (incorporated herein by reference to Exhibit 2.2 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
2.3 | Loan Note Instrument for the US$12,000,000 guaranteed loan notes 2023 (Solar Plant) (incorporated herein by reference to Exhibit 2.3 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.1 | 2015 Omnibus Equity Incentive Compensation Plan (revised 2023)
4.2 | Employment contracts/executive employment agreements (incorporated herein by reference to Exhibit 4.2 to the Registrant’s Annual Report on Form 20-F filed with the SEC on March 30, 2017)
4.3 | Share Subscription Agreements – Blanket Mine (incorporated herein by reference to Exhibit 15.4 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 4, 2016)
4.4 | Addendum to share subscription agreements – FREMIRO, GCSOT, NIEEF, BETS (incorporated herein by reference to Exhibit 4.4 of the Registrant’s Annual Report on Form 20-F filed with the SEC on April 2, 2018)
4.5 | Share Purchase Agreement by and between the Company and Fremiro, dated November 6, 2018 (incorporated herein by reference to Exhibit 4.5 of the Registrant’s Annual Report on Form 20-F filed with the SEC on March 28, 2019)

130

Exhibit No. | Name
4.6 | January 11, 2019 PU award agreement and addendum example (incorporated herein by reference as Exhibit 4.6 of the Registrant’s Annual Report on Form 20-F filed with the SEC on March 28, 2019)
4.7 | January 19, 2020 RSU and PU award agreement example (incorporated herein by reference as Exhibit 4.7 of the Registrant’s Annual Report on Form 20-F filed with the SEC on March 31, 2020)
4.8 | January 11, 2021 PU award agreement example (incorporated herein by reference as Exhibit 4.8 of the Registrant’s Annual Report on Form 20-F filed with the SEC on March 29, 2021)
4.9 | Mining Lease (incorporated herein by reference to Exhibit 4.9 of the registrant’s Annual Report on Form 20-F filed with the SEC on March 31, 2020)
4.10 | January 24, 2022 PU award agreement example (incorporated herein by reference to Exhibit 4.10 of the registrant’s Annual Report on Form 20-F filed with the SEC on May 17, 2022)
4.11 | Addendum to Award Agreement dated January 24, 2022 (incorporated herein by reference to Exhibit 4.11 of the registrant’s Annual Report on Form 20-F filed with the SEC on May 17, 2022)
4.12 | Agreement of Sale – Maligreen Mining Claims (incorporated herein by reference to Exhibit 4.12 of the registrant’s Annual Report on Form 20-F filed with the SEC on May 17, 2022)
4.13 | Agreement for the sale and purchase of the share capital of Bilboes Gold; and amendment agreement in relation to the issue of Consideration Shares under the sale and purchase agreement for the share capital of Bilboes Gold Limited (incorporated herein by reference to Exhibit 4.13 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.14 | Deeds of Amendment in respect of a sale and purchase agreement for the sale and purchase of the share capital of Bilboes Gold Limited (incorporated herein by reference to Exhibit 4.14 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.15 | Net Smelter Returns Royalty Deed (incorporated herein by reference to Exhibit 4.15 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.16 | Share Purchase Agreement between Bulawayo Mining Company Limited and the Company (Motapa) (incorporated herein by reference to Exhibit 4.16 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.19 | Placing Agreement (placing of securities in the Company on AIM and VFEX in March and April 2023) (incorporated herein by reference to Exhibit 4.19 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
4.20 | April 7, 2023 PUs award agreement example
4.21 | April 7, 2023 EPUs award agreement example
4.22 | April 8, 2024 PUs award agreement example
4.23 | April 8, 2024 EPUs award agreement example
8.1 | List of Caledonia Mining Corporation Plc group entities
12.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
13.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
13.2 | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
15.1 | Consent of BDO South Africa Incorporated
15.2 | Consent of DRA Projects (Pty) Ltd
15.3 | Consent of Craig Harvey
15.4 | S-K 1300 Technical Report Summary on the Blanket Gold Mine, Zimbabwe, with an effective date of December 31, 2023

131

Exhibit No. | Name
15.5 | S-K 1300 Technical Report Summary on the Maligreen Gold Project, Zimbabwe, with an effective date of December 31, 2022 (incorporated herein by reference to Exhibit 15.5 to the Registrant’s Annual Report on Form 20-F filed with the SEC on April 28, 2023)
15.6 | Bilboes Gold Project Technical Report Summary, with an effective date December 31, 2023
15.7 | Consent of Uwe Engelmann
15.8 | Consent of Marthinus van Staden
97.1 | Incentive Compensation Recovery Policy
101.INS | Inline XBRL Instance Document
101.SCH | Inline XBRL Taxonomy Extension Schema Document
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 | Cover Page Interactive Data File

132

SIGNATURES

The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and has duly caused and authorized the undersigned to sight this Annual Report on its behalf.

|  | CALEDONIA MINING CORPORATION PLC.
Date: May 15, 2024 | By: | /s/ Mark Learmonth
|  | Name: Mark Learmonth
|  | Title: Chief Executive Officer

133

| Tel: +27 011 488 1700 Fax: +27 010 060 7000 www.bdo.co.za | Wanderers Office Park 52 Corlett Drive Illovo, 2196 Private Bag X60500 Houghton, 2041 South Africa

Report of Independent Registered Public Accounting Firm

Shareholders and Board of Directors

Caledonia Mining Corporation Plc

St Helier, Jersey Channel Islands

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial position of Caledonia Mining Corporation Plc (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of profit or loss and other comprehensive income, statements of changes in equity, and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the Group's auditor since year 2018.

BDO South Africa Incorporated

Wanderers Office Park

52 Corlett Drive

Illovo, 2196

May 15 , 2024

BDO South Africa Incorporated
Registration number: 1995/002310/21
Practice number: 905526
VAT number: 4910148685

Chief Executive Officer: LD Mokoena

A full list of all company directors is available on www.bdo.co.za

The company's principal place of business is at 22 Wellington Road, Parktown, Johannesburg, where a list of directors' names is available for inspection. BDO South Africa Incorporated, a South African personal liability company, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

F-1

Caledonia Mining Corporation Plc

Consolidated statements of profit or loss and other comprehensive income

(in thousands of United States Dollars, unless indicated otherwise)

For the years ended December 31 |  |  | Note |  |  | 2023 |  |  | 2022 |  |  | 2021 |
Revenue |  |  | 8 |  |  |  | 146,314 |  |  |  | 142,082 |  |  |  | 121,329 |
Royalty |  |  |  |  |  |  | (7,637 | ) |  |  | (7,124 | ) |  |  | (6,083 | )
Production costs |  |  | 9 |  |  |  | (82,709 | ) |  |  | (62,998 | ) |  |  | (53,126 | )
Depreciation |  |  | 18 |  |  |  | (14,486 | ) |  |  | (10,141 | ) |  |  | (8,046 | )
Gross profit |  |  |  |  |  |  | 41,482 |  |  |  | 61,819 |  |  |  | 54,074 |
Other income |  |  |  |  |  |  | 263 |  |  |  | 60 |  |  |  | 46 |
Other expenses |  |  | 10 |  |  |  | (4,367 | ) |  |  | (11,782 | ) |  |  | (7,136 | )
Administrative expenses |  |  | 11 |  |  |  | (17,429 | ) |  |  | (11,941 | ) |  |  | (9,091 | )
Cash-settled share-based expense |  |  | 12.1 |  |  |  | (463 | ) |  |  | (609 | ) |  |  | (477 | )
Equity-settled share-based expense |  |  | 12.2 |  |  |  | (640 | ) |  |  | (484 | ) |  |  | – |
Net foreign exchange (loss) gain |  |  | 13 |  |  |  | (2,550 | ) |  |  | 4,411 |  |  |  | 1,184 |
Net derivative financial instrument expense |  |  | 14 |  |  |  | (1,119 | ) |  |  | (1,198 | ) |  |  | (240 | )
Operating profit |  |  |  |  |  |  | 15,177 |  |  |  | 40,276 |  |  |  | 38,360 |
Finance income |  |  | 15 |  |  |  | 39 |  |  |  | 17 |  |  |  | 14 |
Finance cost |  |  | 15 |  |  |  | (3,024 | ) |  |  | (657 | ) |  |  | (375 | )
Profit before tax |  |  |  |  |  |  | 12,192 |  |  |  | 39,636 |  |  |  | 37,999 |
Tax expense |  |  | 16 |  |  |  | (12,810 | ) |  |  | (16,770 | ) |  |  | (14,857 | )
(Loss) profit for the period |  |  |  |  |  |  | (618 | ) |  |  | 22,866 |  |  |  | 23,142 |
Other comprehensive income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Items that are or may be reclassified to profit or loss |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exchange differences on translation of foreign operations |  |  |  |  |  |  | (622 | ) |  |  | (462 | ) |  |  | (531 | )
Total comprehensive income for the period |  |  |  |  |  |  | (1,240 | ) |  |  | 22,404 |  |  |  | 22,611 |
(Loss) profit attributable to: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owners of the Company |  |  |  |  |  |  | (4,198 | ) |  |  | 17,903 |  |  |  | 18,405 |
Non-controlling interests |  |  | 28 |  |  |  | 3,580 |  |  |  | 4,963 |  |  |  | 4,737 |
(Loss) profit for the period |  |  |  |  |  |  | (618 | ) |  |  | 22,866 |  |  |  | 23,142 |
Total comprehensive income attributable to: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owners of the Company |  |  |  |  |  |  | (4,820 | ) |  |  | 17,441 |  |  |  | 17,874 |
Non-controlling interests |  |  | 28 |  |  |  | 3,580 |  |  |  | 4,963 |  |  |  | 4,737 |
Total comprehensive income for the period |  |  |  |  |  |  | (1,240 | ) |  |  | 22,404 |  |  |  | 22,611 |
(Loss) earnings per share |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic (loss) earnings per share ($) |  |  | 27 |  |  |  | (0.24 | ) |  |  | 1.36 |  |  |  | 1.49 |
Diluted (loss) earnings per share ($) |  |  | 27 |  |  |  | (0.24 | ) |  |  | 1.35 |  |  |  | 1.48 |

The accompanying notes on pages 7 to 78 are an integral part of these consolidated financial statements.

On behalf of the Board: “J.M. Learmonth”- Chief Executive Officer and “C.O. Goodburn”- Chief Financial Officer.

F-2

Caledonia Mining Corporation Plc

Consolidated statements of financial position

(in thousands of United States Dollars, unless indicated otherwise)

As at December 31 |  |  | Note |  |  | 2023 |  |  | 2022 |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Exploration and evaluation assets |  |  | 17 |  |  |  | 94,272 |  |  |  | 17,579 |
Property, plant and equipment |  |  | 18 |  |  |  | 179,649 |  |  |  | 178,983 |
Deferred tax asset |  |  | 16 |  |  |  | 153 |  |  |  | 202 |
Total non-current assets |  |  |  |  |  |  | 274,074 |  |  |  | 196,764 |
Income tax receivable |  |  | 16 |  |  |  | 1,120 |  |  |  | 40 |
Inventories |  |  | 20 |  |  |  | 20,304 |  |  |  | 18,334 |
Derivative financial assets |  |  | 14.1 |  |  |  | 88 |  |  |  | 440 |
Trade and other receivables |  |  | 21 |  |  |  | 9,952 |  |  |  | 9,185 |
Prepayments |  |  | 22 |  |  |  | 2,538 |  |  |  | 3,693 |
Cash and cash equivalents |  |  | 23 |  |  |  | 6,708 |  |  |  | 6,735 |
Assets held for sale |  |  | 24 |  |  |  | 13,519 |  |  |  | – |
Total current assets |  |  |  |  |  |  | 54,229 |  |  |  | 38,427 |
Total assets |  |  |  |  |  |  | 328,303 |  |  |  | 235,191 |
Equity and liabilities |  |  |  |  |  |  |  |  |  |  |  |
Share capital |  |  | 25 |  |  |  | 165,068 |  |  |  | 83,471 |
Reserves |  |  | 26 |  |  |  | 137,819 |  |  |  | 137,801 |
Retained loss |  |  |  |  |  |  | (63,172 | ) |  |  | (50,222 | )
Equity attributable to shareholders |  |  |  |  |  |  | 239,715 |  |  |  | 171,050 |
Non-controlling interests |  |  | 28 |  |  |  | 24,477 |  |  |  | 22,409 |
Total equity |  |  |  |  |  |  | 264,192 |  |  |  | 193,459 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Deferred tax liabilities |  |  | 16 |  |  |  | 6,131 |  |  |  | 5,123 |
Provisions |  |  | 29 |  |  |  | 10,985 |  |  |  | 2,958 |
Loan notes - long term portion |  |  | 30 |  |  |  | 6,447 |  |  |  | – |
Cash-settled share-based payment - long term portion |  |  | 12.1 |  |  |  | 374 |  |  |  | 1,029 |
Lease liabilities - long term portion |  |  | 19 |  |  |  | 41 |  |  |  | 181 |
Total non-current liabilities |  |  |  |  |  |  | 23,978 |  |  |  | 9,291 |
Cash-settled share-based payment - short term portion |  |  | 12.1 |  |  |  | 920 |  |  |  | 1,188 |
Income tax payable |  |  | 16 |  |  |  | 10 |  |  |  | 1,324 |
Lease liabilities - short term portion |  |  | 19 |  |  |  | 167 |  |  |  | 132 |
Loan notes - short term portion |  |  | 30 |  |  |  | 665 |  |  |  | 7,104 |
Trade and other payables |  |  | 31 |  |  |  | 20,503 |  |  |  | 17,454 |
Overdraft and term loans |  |  | 23 |  |  |  | 17,740 |  |  |  | 5,239 |
Liabilities associated with assets held for sale |  |  | 24 |  |  |  | 128 |  |  |  | – |
Total current liabilities |  |  |  |  |  |  | 40,133 |  |  |  | 32,441 |
Total liabilities |  |  |  |  |  |  | 64,111 |  |  |  | 41,732 |
Total equity and liabilities |  |  |  |  |  |  | 328,303 |  |  |  | 235,191 |

The accompanying notes on pages 7 to 78 are an integral part of these consolidated financial statements.

F-3

Caledonia Mining Corporation Plc

Consolidated statements of changes in equity

For the years ended December 31,

(in thousands of United States Dollars, unless indicated otherwise)

|  | Note |  |  | Share capital |  |  | Foreign currency translation reserve |  |  | Contributed surplus |  |  | Equity-settled share-based payment reserve |  |  | Retained loss |  |  | Total |  |  | Non-controlling interests (NCI) |  |  | Total equity |
Balance January 1, 2021 |  |  |  |  |  |  | 74,696 |  |  |  | (8,794 | ) |  |  | 132,591 |  |  |  | 14,513 |  |  |  | (71,487 | ) |  |  | 141,519 |  |  |  | 16,524 |  |  |  | 158,043 |
Transactions with owners: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends declared |  |  | 34 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (6,068 | ) |  |  | (6,068 | ) |  |  | (2,001 | ) |  |  | (8,069 | )
Shares issued: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Options exercised |  |  |  |  |  |  | 165 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 165 |  |  |  | - |  |  |  | 165 |
- Equity raise (net of transaction cost) |  |  | 25 |  |  |  | 7,806 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 7,806 |  |  |  | - |  |  |  | 7,806 |
Total comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Profit for the year |  |  |  |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 18,405 |  |  |  | 18,405 |  |  |  | 4,737 |  |  |  | 23,142 |
Other comprehensive income for the year |  |  |  |  |  |  | - |  |  |  | (531 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (531 | ) |  |  | - |  |  |  | (531 | )
Balance December 31, 2021 |  |  |  |  |  |  | 82,667 |  |  |  | (9,325 | ) |  |  | 132,591 |  |  |  | 14,513 |  |  |  | (59,150 | ) |  |  | 161,296 |  |  |  | 19,260 |  |  |  | 180,556 |
Transactions with owners: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends declared |  |  | 34 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (8,975 | ) |  |  | (8,975 | ) |  |  | (1,814 | ) |  |  | (10,789 | )
Share-based payments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Shares issued on settlement of incentive plan awards |  |  | 12.1 |  |  |  | 804 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 804 |  |  |  | - |  |  |  | 804 |
- Equity-settled share-based expense |  |  | 12.2 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 484 |  |  |  | - |  |  |  | 484 |  |  |  | - |  |  |  | 484 |
Total comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Profit for the year |  |  |  |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 17,903 |  |  |  | 17,903 |  |  |  | 4,963 |  |  |  | 22,866 |
Other comprehensive income for the year |  |  |  |  |  |  | - |  |  |  | (462 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (462 | ) |  |  | - |  |  |  | (462 | )
Balance at December 31, 2022 |  |  |  |  |  |  | 83,471 |  |  |  | (9,787 | ) |  |  | 132,591 |  |  |  | 14,997 |  |  |  | (50,222 | ) |  |  | 171,050 |  |  |  | 22,409 |  |  |  | 193,459 |

F-4

Caledonia Mining Corporation Plc

Consolidated statements of changes in equity (continued)

For the years ended December 31,

(in thousands of United States Dollars, unless indicated otherwise)

|  | Note |  |  | Share capital |  |  | Foreign currency translation reserve |  |  | Contributed surplus |  |  | Equity-settled share-based payment reserve |  |  | Retained loss |  |  | Total |  |  | Non-controlling interests (NCI) |  |  | Total equity |
Balance December 31, 2022 |  |  |  |  |  |  | 83,471 |  |  |  | (9,787 | ) |  |  | 132,591 |  |  |  | 14,997 |  |  |  | (50,222 | ) |  |  | 171,050 |  |  |  | 22,409 |  |  |  | 193,459 |
Transactions with owners: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends declared |  |  | 34 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (8,752 | ) |  |  | (8,752 | ) |  |  | (1,512 | ) |  |  | (10,264 | )
Share-based payments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Shares issued on settlement of incentive plan awards |  |  | 12.1 |  |  |  | 351 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 351 |  |  |  | - |  |  |  | 351 |
- Equity-settled share-based expense |  |  | 12.2 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 640 |  |  |  | - |  |  |  | 640 |  |  |  | - |  |  |  | 640 |
Shares issued: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Equity raise (net of transaction cost) |  |  | 25 |  |  |  | 15,569 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 15,569 |  |  |  | - |  |  |  | 15,569 |
- Bilboes acquisition |  |  | 5 |  |  |  | 65,677 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 65,677 |  |  |  | - |  |  |  | 65,677 |
Total comprehensive income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
(Loss) profit for the year |  |  |  |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (4,198 | ) |  |  | (4,198 | ) |  |  | 3,580 |  |  |  | (618 | )
Other comprehensive income for the year |  |  |  |  |  |  | - |  |  |  | (622 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (622 | ) |  |  | - |  |  |  | (622 | )
Balance at December 31, 2023 |  |  |  |  |  |  | 165,068 |  |  |  | (10,409 | ) |  |  | 132,591 |  |  |  | 15,637 |  |  |  | (63,172 | ) |  |  | 239,715 |  |  |  | 24,477 |  |  |  | 264,192 |
|  | Note |  |  |  | 25 |  |  |  | 26 |  |  |  | 26 |  |  |  | 26 |  |  |  |  |  |  |  |  |  |  |  | 28 |  |  |  |  |

The accompanying notes on pages 7 to 78 are an integral part of these consolidated financial statements.

F-5

Caledonia Mining Corporation Plc

Consolidated statements of cash flows

For the years ended December 31,

(in thousands of United States Dollars, unless indicated otherwise)

|  |  | Note |  |  | 2023 |  |  | 2022 |  |  | 2021 |
Cash inflow from operations |  |  | 32 |  |  |  | 26,398 |  |  |  | 49,657 |  |  |  | 38,703 |
Interest received |  |  |  |  |  |  | 39 |  |  |  | 17 |  |  |  | 14 |
Finance costs paid |  |  | 15 |  |  |  | (2,462 | ) |  |  | (192 | ) |  |  | (388 | )
Tax paid |  |  | 16 |  |  |  | (9,206 | ) |  |  | (6,866 | ) |  |  | (7,426 | )
Net cash inflow from operating activities |  |  |  |  |  |  | 14,769 |  |  |  | 42,616 |  |  |  | 30,903 |
Cash flows used in investing activities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Acquisition of property, plant and equipment |  |  | 18 |  |  |  | (28,556 | ) |  |  | (41,495 | ) |  |  | (32,112 | )
Acquisition of exploration and evaluation assets |  |  | 17 |  |  |  | (1,837 | ) |  |  | (2,596 | ) |  |  | (5,717 | )
Proceeds from sale of assets held for sale |  |  | 24.1 |  |  |  | – |  |  |  | – |  |  |  | 500 |
Proceeds from derivative financial instruments |  |  | 14.2 |  |  |  | 178 |  |  |  | – |  |  |  | 1,066 |
Acquisition of Put options |  |  | 14.1 |  |  |  | (946 | ) |  |  | (478 | ) |  |  | – |
Proceeds from disposal of subsidiary |  |  | 24.2 |  |  |  | – |  |  |  | – |  |  |  | 340 |
Proceeds from call options |  |  | 14.2 |  |  |  | – |  |  |  | 416 |  |  |  | 208 |
Acquisition of call options |  |  | 14.2 |  |  |  | – |  |  |  | (176 | ) |  |  | – |
Net cash used in investing activities |  |  |  |  |  |  | (31,161 | ) |  |  | (44,329 | ) |  |  | (35,715 | )
Cash flows from financing activities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends paid |  |  | 34 |  |  |  | (11,099 | ) |  |  | (8,906 | ) |  |  | (8,069 | )
Payment of lease liabilities |  |  | 19 |  |  |  | (184 | ) |  |  | (150 | ) |  |  | (129 | )
Shares issued – equity raise (net of transaction cost) |  |  | 25 |  |  |  | 15,569 |  |  |  | – |  |  |  | 7,806 |
Repayments of term loans |  |  |  |  |  |  | – |  |  |  | – |  |  |  | (361 | )
Loan notes - Motapa payment |  |  | 30.1 |  |  |  | (7,250 | ) |  |  | – |  |  |  | – |
Loan notes - solar bond issue receipts (net of transaction cost) |  |  | 30.2 |  |  |  | 6,895 |  |  |  | – |  |  |  | – |
Proceeds from gold loan |  |  | 14.2 |  |  |  | – |  |  |  | – |  |  |  | 2,752 |
Repayment of gold loan |  |  | 14.2 |  |  |  | – |  |  |  | (3,698 | ) |  |  | – |
Proceeds from share options exercised |  |  | 25 |  |  |  | – |  |  |  | – |  |  |  | 165 |
Net cash from/ (used in) financing activities |  |  |  |  |  |  | 3,931 |  |  |  | (12,754 | ) |  |  | 2,164 |
Net decrease in cash and cash equivalents |  |  |  |  |  |  | (12,461 | ) |  |  | (14,467 | ) |  |  | (2,648 | )
Effect of exchange rate fluctuations on cash and cash equivalents |  |  |  |  |  |  | (67 | ) |  |  | (302 | ) |  |  | (179 | )
Net cash and cash equivalents at the beginning of the year |  |  |  |  |  |  | 1,496 |  |  |  | 16,265 |  |  |  | 19,092 |
Net cash and cash equivalents at the end of the year |  |  | 23 |  |  |  | (11,032 | ) |  |  | 1,496 |  |  |  | 16,265 |

The accompanying notes on pages 7 to 78 are an integral part of these consolidated financial statements.

F-6

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

1 | Reporting entity

Caledonia Mining Corporation Plc (“Caledonia” or the “Company”) is a company domiciled in Jersey, Channel Islands. The Company’s registered office address is B006 Millais House, Castle Quay, St Helier, Jersey, Channel Islands.

These consolidated financial statements of the Company and its subsidiaries (the “Group”) comprise the consolidated statements of financial position as at December 31, 2023 and 2022, the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for each of the years ended December 31, 2023, 2022 and 2021, disclosure notes, material accounting policies and other explanatory information. The Group’s primary involvement is in the operation of a gold mine and the exploration and development of mineral properties for precious metals.

Caledonia’s shares are listed on the NYSE American LLC stock exchange (symbol – “CMCL”). Depository interests in Caledonia’s shares are admitted to trading on AIM of the London Stock Exchange plc (symbol – “CMCL”). Caledonia listed on the Victoria Falls Stock Exchange (“VFEX”) (symbol – “CMCL”) on December 2, 2021. Caledonia voluntary delisted from the Toronto Stock Exchange (the “TSX”) on June 19, 2020. After the delisting the Company remains a Canadian reporting issuer and has to comply with Canadian securities laws until it demonstrates that Canadian shareholders represent less than 2% of issued share capital.

2 | Basis of preparation

i) | Statement of compliance

The consolidated financial statements have been prepared on a going concern basis, in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board (“IFRS”).

The consolidated financial statements were approved for issue by the Board of Directors on March 28, 2024.

ii) | Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis except for:

● | cash-settled share-based payment arrangements measured at fair value on grant and re-measurement dates;
● | equity-settled share-based payment arrangements measured at fair value on the grant date; and
● | derivative financial assets and derivative financial liabilities measured at fair value.

iii) | Functional currency

The consolidated financial statements are presented in United States Dollars (“$” or “US Dollars” or “USD”), which is also the functional currency of the Company. All financial information presented in US Dollars has been rounded to the nearest thousand, unless indicated otherwise. Refer to note 13 for changes to Zimbabwean real-time gross settlement, bond notes or bond coins (“RTGS$”) and its effect on the consolidated statement of profit or loss and other comprehensive income.

F- 7

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

3 | Use of accounting assumptions, estimates and judgements

In preparing these consolidated financial statements, management has made accounting assumptions, estimates and judgements that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Changes in estimates are recognised prospectively.

(a) | Estimation uncertainties

i) | Depreciation of property, plant and equipment

Depreciation on mine development, infrastructure and other assets in the production phase is computed on the units-of-production method over the life-of-mine based on the estimated quantities of reserves (proven and probable) and resources (measured, indicated and inferred), which are planned to be extracted in the future from known mineral deposits. Where mine development, infrastructure and other assets have a shorter useful life than the life-of-mine, they are depreciated over their useful life. Confidence in the existence, commercial viability and economical recovery of reserves and resources included in the life-of-mine may be based on historical experience and available geological information. This is in addition to the drilling results obtained by the Group and management’s knowledge of the geological setting of the surrounding areas, which would enable simulations and extrapolations to be done with a sufficient degree of accuracy. In instances where management is able to demonstrate the economic recovery of resources with a high level of confidence, such additional resources, are included in the calculation of depreciation.

Refer to note 18 for change in estimates to mine development, infrastructure and other assets. Other items of property, plant and equipment are depreciated as described in note 4(j)(iii).

ii) | Mineral reserves and resources

Mineral reserves and resources are estimates of the amount of product that can be economically and legally extracted. In order to calculate the reserves and resources, estimates and assumptions are required about a range of geological, technical and economic factors, including but not limited to quantities, grades, production techniques, recovery rates, production costs, transport costs, commodity prices and exchange rates. Estimating the quantity and grade of mineral reserves and resources requires the size, shape and depth of orebodies to be determined by analysing geological data such as the logging and assaying of drill samples. This process may require complex and difficult geological assumptions and calculations to interpret the data. Estimates of mineral reserves and resources may change due to the change in economic assumptions used to estimate mineral reserves and resources and due to additional geological data becoming available during the course of operations.

The Group estimates its reserves (proven and probable) and resources (measured, indicated and inferred) based on information compiled by a Qualified Person in terms of the Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and the United States Securities and Exchange Commission’s Subpart 1300 of Regulation S-K (“Subpart 1300”) relating to geological and technical data of the size, depth, shape and grade of the ore body and suitable production techniques and recovery rates. Such an analysis requires geological and engineering assumptions to interpret the data. These assumptions include:

● | correlation between drill-hole intersections where multiple reefs intersect;
● | continuity of mineralisation between drill-hole intersections within recognised reefs; and
● | appropriateness of the planned mining methods.

F- 8

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

3 | Use of accounting assumptions, estimates and judgements (continued)

(a) | Assumptions and estimation uncertainties (continued)

ii) | Mineral reserves and resources (continued)

The Group estimates and reports reserves and resources in accordance with Subpart 1300 and NI 43-101 and the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards for Mineral Resources and Mineral Reserves. Complying with the CIM code, NI 43-101 requires the use of reasonable assumptions to calculate the recoverable resources. These assumptions include:

● | the gold price based on current market price and the Group’s assessment of future prices;
● | estimated future on-mine costs, sustaining and non-sustaining capital expenditures;
● | cut-off grade;
● | dimensions and extent, determined both from drilling and mine development, of ore bodies; and
● | planned future production from measured, indicated and inferred resources.

Changes in reported reserves and resources may affect the Group’s financial results and position in several ways, including the following:

● | asset carrying values may be affected due to changes in the estimated cash flows (i.e. Impairment);
● | depreciation and amortisation charges to profit or loss may change as these are calculated on the unit-of production method or where useful lives of an asset change; and
● | decommissioning, site restoration and environmental provisions and resources which may affect expectations about the timing or cost of these activities.

iii) | Impairment

Non-financial assets

At each reporting date, the Group determines if impairment indicators exist and, if present, performs an impairment review of the non-financial assets held in the Group. The exercise is subject to various assumptions and estimates. Refer to note 4(c) for more information.

Non-derivative financial assets

The Group uses a simplified approach in accounting for trade receivables and records the loss allowance as lifetime expected credit losses. When measuring expected credit losses, the Group uses reasonable and supportable forward-looking information, which is based on the assumptions for the future movement of different economic drivers and how these drivers will affect each other. Loss given default is an estimate of the loss arising on default. It is based on the expected shortfalls in contractual cash flows. The Group uses a provision matrix to calculate the probability of default, which includes historical data, assumptions and expectations of future conditions.

F- 9

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

3 | Use of accounting assumptions, estimates and judgements (continued)

(a) | Assumptions and estimation uncertainties (continued)

iv) | Share-based payment transactions

Equity-settled share-based payment arrangements

The Group measures the cost of equity-settled share-based payment transactions with employees, directors and Blanket Mine (1983) (Private) Limited’s (“Blanket Mine” or “Blanket”) indigenous shareholders (refer to note 6) by reference to the fair value of the equity instruments on the date at which they are granted. Estimating fair value for share-based payment transactions requires determining the appropriate valuation model and considering the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model, including the expected life of the share option, volatility and dividend yield.

Where the Company granted the counterparty to a share-based payment award the choice of settlement in cash or shares, the equity component is measured as the difference between the fair value of the goods and services and the fair value of the cash-settled share-based payment liability at the date when the goods and services are received at the measurement date. For transactions with employees, the equity component is zero.

Option pricing models require the input of assumptions, including the expected price volatility. Changes in the subjective input assumptions can materially affect the fair value estimate. Therefore, the existing models may not necessarily provide a reliable single measure of the fair value of the Group’s share options.

Additional information about significant assumptions and estimates used to determine the fair value of equity-settled share-based payment transactions are disclosed in note 12.2.

Cash-settled share-based payment arrangements

The fair value of the amount payable to employees regarding share-based awards that will be settled in cash is recognised as an expense with a corresponding increase in liabilities over the period over which the employee becomes unconditionally entitled to payment. The liability is re-measured at each reporting date. Any change in the fair value of the liability is recognised in profit or loss.

Additional information about significant assumptions and estimates used to determine the fair value of cash-settled share-based payment transactions are disclosed in note 12.1.

v) | Taxes

Significant assumptions and estimates are required in determining the provision for income taxes. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain.

In 2023, the Zimbabwe Revenue Authority (“ZIMRA”) issued Public Notice 20 (“PN20”). PN 20 provided clarity on the interpretation of Section 37AA of the Income Tax Act [Chapter 23:06] of Zimbabwe, which requires taxpayers to submit separate tax returns where any part of the income from trade or investment is earned in foreign currency.

Section 37AA stated that the calculation of taxable income be expressed in the currency of the transaction and that the payment of the tax payable be made proportionately to in which currency the revenue earned. The section further provides that the RTGS$ should be converted to US$ using the average auction rate of exchange for the year of assessment, with the same being applicable to US$ amounts that need to be converted to RTGS$.

F- 10

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

3 | Use of accounting assumptions, estimates and judgements (continued)

(a) | Assumptions and estimation uncertainties (continued)

v) | Taxes (continued)

Management believes they have adequately provided for the probable outcome of tax related matters; however, the final outcome or future outcomes anticipated in calculating the tax liabilities may result in a materially different outcome than the amount included in the tax liabilities. In addition, the Group further makes assumptions and estimates when recognising deferred tax assets relating to tax losses carried forward to the extent that there are sufficient future taxable temporary differences (deferred tax liabilities) relating to the same taxation authority and the same taxable entity against which the unused tax losses may be utilised or sufficient estimated future taxable income against which the losses can be utilised.

vi) | Blanket Mine’s indigenisation transaction

The initial indigenisation transaction and modifications to the indigenisation transaction of Blanket Mine required management to make significant assumptions and estimates which are explained in note 6.

vii) | Exploration and evaluation (“E&E”) assets

The Group also makes assumptions and estimates regarding the technical feasibility and commercial viability of its mineral projects and the possible impairment of E&E assets by evaluating whether it is likely that future economic benefits will flow to the Group, which may be based on assumptions about future events or circumstances e.g. such as the completion of a feasibility study indicating construction, funding and economic returns that are sufficient. Assumptions and estimates made may change if new information becomes available. If information becomes available suggesting that the recovery of expenditures is unlikely, the amount capitalised is written off in profit or loss in the period the new information becomes available. The recoverability of the carrying amount of exploration and evaluation assets depends on the availability of sufficient funding to bring the properties into commercial production, the price of the products to be recovered and the undertaking of profitable mining operations. As a result of these uncertainties, the actual amount recovered may vary significantly from the carrying amount.

viii) | Site restoration provision

A site restoration provision has been calculated for the Blanket Mine and the Bilboes, Maligreen and Motapa projects based on an independent analysis of the rehabilitation costs as performed in 2023. For projects the restoration costs are recognised at the current estimated cost of restoration and is undiscounted. For the Blanket Mine the inflationary effect on current restoration costs are applied and then discounted to arrive at the present value of the provision. Assumptions, based on the current economic environment, have been made that management believes are a reasonable basis for estimating the future liability. These estimates take into account any material changes to the assumptions that occur when reviewed by management. Estimates are reviewed annually and are based on current regulatory requirements. Significant changes in estimates of contamination estimates, restoration standards, and techniques will result in changes to the provision from period to period. Actual rehabilitation costs will ultimately depend on future market prices for the rehabilitation. The final cost of the currently recognised site rehabilitation provision may be higher or lower than currently provided for (refer to note 29).

F- 11

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

3 | Use of accounting assumptions, estimates and judgements (continued)

(a) | Assumptions and estimation uncertainties (continued)

viii) | Site restoration provision (continued)

Also refer to note 29 for how site restoration provisions are estimated for properties in the exploration and evaluation phase.

(b) | Judgements

Judgement is required when assessing whether the Group controls an entity or not. Controlled entities are consolidated. Further information is given in notes 4(a) and 6.

For judgement applied to:

● | determine functional currency of entities in the Group and the use of the interbank rate of exchange to translate RTGS$, refer to note 13,
● | impairments, refer to note 18 and 17.

4 | Material accounting policies

The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements. In addition, the accounting policies have been applied consistently by the Group.

a) | Basis of consolidation

i) | Subsidiaries and structured entities

Subsidiaries and certain structured entities are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variability in returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases.

ii) | Loss of control

When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related Non-controlling interests (“NCI”) and other components of equity. Any gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.

iii) | Non-controlling interests

NCI is measured at their proportionate share of the carrying amounts of the acquiree’s identifiable net assets at fair value at the acquisition date. Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

iv) | Transactions eliminated on consolidation

Intra-group balances and transactions arising from intra-group transactions are eliminated.

F- 12

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(b) | Revenue

i) | Fidelity Gold Refinery (Private) Limited (“Fidelity”) and further refinement

Revenue from the sale of precious metals at Blanket is recognised when the unrefined metal is accepted at the refinery (“Local lodgment date”) by Fidelity, except for the portion earmarked for export to a refiner outside of Zimbabwe. Control is transferred and the receipt of proceeds is substantially assured at point of delivery at the end refiner with the responsibility to pay. Revenue for each delivery to Fidelity is measured at the London Base Metal Association price post-delivery less 1.25% and the quantities are determined on Local lodgment date. On average, settlement occurs within 14 days of delivery from Fidelity and within 2 days from Al Etihad Gold Refinery DMCC.

A portion of unrefined metals produced by Blanket is exported by Caledonia to Al Etihad Gold Refinery DMCC (“AEG” an accredited Dubai Good Delivery refinery), which makes payment to Caledonia's bank account in Zimbabwe in USD. The exported unrefined gold continues to be processed at Fidelity, a subsidiary of the Reserve Bank of Zimbabwe (“RBZ”), on a toll-treatment basis, in accordance with requirements of the Zimbabwe government for in-country refining and to allow the Zimbabwe authorities full visibility over the gold produced and exported by Caledonia. The resultant gold is exported under the gold dealing licence that is held by Fidelity to a refinery outside Zimbabwe which undertakes the final refining process. Caledonia receives the proceeds of the gold that it exports in its bank account in Zimbabwe within a few days of delivery to the final refiner. This arrangement in respect of production from Blanket complies with the current requirements to pay a 5% royalty on gold sales and 1.25% of gross sales which is payable to the Zimbabwean Government and deducted from USD and RTGS$ revenues proportionately.

For deliveries exported and for deliveries that are paid by Fidelity, Blanket continues to receive 75% of its revenues in US Dollars and the balance in local currency. Revenue for the unrefined metals exported to a refiner outside Zimbabwe from the sale of precious metals is recognised when the refiner outside of Zimbabwe receives the unrefined metals (“Export lodgment date”). Control is transferred and the receipt of proceeds is substantially assured at the point of delivery. Export lodgment date revenue for each delivery is measured at the London Base Metal Association price post-delivery less a refining fee and the quantities are determined on Export lodgment date. On average settlement occurs within two days of delivery.

Revenue from the sale of precious metals at Bilboes is recognised when the unrefined metal is accepted at the refinery (“Local lodgment date”) by Fidelity. Control is transferred and the receipt of proceeds is substantially assured at point of delivery at the end refiner with the responsibility to pay. Revenue for each delivery to Fidelity is measured at the London Base Metal Association price post-delivery less 1.25% and the quantities are determined on Local lodgment date. Part of the Bilboes revenue during the year was recognised from sales to Fidelity as a “small-scale producer”, measured at the previous day’s 6pm London Base Metal Association price less a 5% discount. The revenue was received 100% in USD and settlement occurred immediately after depositing of the bullion.

F- 13

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(c) | Impairment

i) | Expected credit losses on financial assets

The Group applies the IFRS 9 simplified model and recognises lifetime expected credit losses for all trade receivables as these items do not have a significant financing component. In measuring the expected credit losses, the trade receivables have been assessed individually as they possess different credit risk characteristics. Trade receivables have been assessed based on the days past due. The expected loss rates are based on the payment profile for gold sales over the past 48 months prior to December 31, of each year reported. The historical rates are adjusted to reflect current and forward looking macroeconomic factors i.e. (interest rate, country risk, and risk free rate) affecting the customer’s ability to settle the amount outstanding. The Group considers a trade receivable to be in default when the amount is 90 days past due from lodgment date. Failure to make payments within 90 days from lodgment date and failure to engage with the Group on alternative payment arrangement, amongst others, are considered indicators of no reasonable expectation of recovery. Trade and other receivables are written off (i.e. derecognised) when there is no reasonable expectation of recovery.

ii) | Non-financial assets

The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets are reviewed at each reporting date to determine whether there is any indication of impairment. The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generate cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit” or “CGU”). The Group’s corporate assets do not generate separate cash inflows. If there is an indication that a CGU to which a corporate asset is allocated may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs.

An impairment loss is recognised if the carrying amount of a CGU exceeds its estimated recoverable amount. Impairment losses recognised in respect of CGUs are allocated to reduce the carrying amount of assets in the unit (group of units) on a pro rata basis. Impairment losses recognised in prior years are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been an indication of reversal and a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

F- 14

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(c) | Impairment (continued)

iii) | Impairment of Exploration and evaluation (“E&E”) assets

The test for impairment of E&E assets can combine several CGUs as long as the combination is not larger than a segment. The definition of a CGU does, however, change once development activities have begun. There are specific impairment triggers for E&E assets. Despite certain relief in respect of impairment triggers and the level of aggregation, the impairment standard is applied in measuring the impairment of E&E assets. Reversals of impairment losses are required in the event that the circumstances that resulted in impairment have changed.

E&E assets are assessed for impairment only when facts and circumstances suggest that the carrying amount of an E&E asset may exceed its recoverable amount. Indicators of impairment include the following:

● | The entity's right to explore in the specific area has expired or will expire in the near future and is not expected to be renewed.
● | Substantive expenditure on further E&E activities in the specific area is neither budgeted nor planned in future.
● | The entity has not discovered commercially viable quantities of mineral resources as a result of E&E activities in the area to date and has decided to discontinue such activities in the specific area.
● | Even if development is likely to proceed, the entity has sufficient data indicating that the carrying amount of the asset is unlikely to be recovered in full from successful development or by sale.

(d) | Share-based payment transactions

i) | Equity-settled share-based payments to employees and directors

The grant date fair value of equity-settled share-based payment awards granted to employees and directors is recognised as an expense, with a corresponding increase in equity, over the vesting period of the award. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that meet the related service and non-market vesting conditions at the vesting date.

Where equity instruments are granted to non-employees, they are recorded at the fair value of the goods or services received in profit or loss.

Additional information about significant judgements, estimates and the assumptions used to estimate the fair value of equity-settled share-based payment transactions are disclosed in note 12.2.

ii) | Cash-settled share-based payments to employees and directors

The grant date fair value of cash-settled awards granted to employees and directors is recognised as an expense, with a corresponding increase in the liability, over the vesting period of the awards. At each reporting date the fair value of the awards is re-measured with a corresponding adjustment to profit or loss. Additional information about significant judgements, estimates and the assumptions used to estimate the fair value of cash-settled share-based payment transactions are disclosed in note 12.1.

F- 15

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(e) | Foreign currency

i) | Foreign operations

As stated in note 2(iii) the presentation currency of the Group is the US Dollars. The functional currency of the Company and all its subsidiaries is the US Dollars except for the South African subsidiary that uses the South African Rand (“ZAR”) as its functional currency. Subsidiary financial statements have been translated to the presentation currency as follows:

● | assets and liabilities are translated using the exchange rate at year end; and

● | income, expenses and cash flow items are translated using the rate that approximates the exchange rates at the dates of the transactions.

When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from the item are considered to form part of the net investment in a foreign operation and are recognised in Other Comprehensive Income (“OCI”).

If settlement is planned or likely in the foreseeable future, foreign exchange gains and losses are included in profit or loss. When settlement occurs, the settlement will not be regarded as a partial disposal and accordingly the foreign exchange gain or loss previously recognised in OCI is not reclassified to profit or loss/reallocated to NCI.

When the Group disposes of its entire interest in a foreign operation or loses control over a foreign operation, the foreign currency gains or losses accumulated in OCI related to the foreign operation are reclassified to profit or loss. If the Group disposes of part of an interest in a foreign operation which remains a subsidiary, a proportionate amount of foreign currency gains or losses accumulated in OCI related to the subsidiary are reattributed between controlling and non-controlling interests.

All resulting translation differences are reported in OCI and accumulated in the foreign currency translation reserve.

ii) | Foreign currency translation

In preparing the financial statements of the Group entities, transactions in currencies other than the functional currency (foreign currencies) of these Group entities are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting date, monetary assets and liabilities are translated using the current foreign exchange rate. Non-monetary assets and liabilities are translated using the historical rate on the date of the transaction. All gains and losses on translation of these foreign currency transactions are included in profit or loss for the year.

On October 1, 2018 the Reserve Bank of Zimbabwe (“RBZ) pegged the Zimbabwe dollar (“RTGS$”) at 1:1 to the US Dollar and on February 20, 2019 issued a further monetary policy statement, which allowed inter-bank trading between RTGS$ and foreign currency. The interbank rate was introduced at 2.5 RTGS$ to 1 US Dollar and traded at RTGS$ 6,104.72 (2022: RTGS$ 684.33, 2021: RTGS$ 108.67) to 1 US Dollar as at December 31, 2023.

F- 16

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(e) | Foreign currency (continued)

ii) | Foreign currency translation (continued)

Further, the RBZ issued a directive to Zimbabwean banks to separate foreign currency and RTGS$ for bank accounts held by clients on October 1, 2018. Subsequent to the directive, the RBZ announced that 30% of Blanket Mine’s gold proceeds will be received in foreign currency (i.e., US Dollars) and the remainder received as RTGS$. From November 12, 2018 the RBZ increased the foreign currency allocation from 30% to 55%, with the remainder received as RTGS$. The RBZ increased the foreign currency allocation with effect from May 26, 2020 from 55% to 70% and decreased the foreign currency allocation with effect from January 8, 2021 from 70% to 60% with the remainder received as RTGS$. On February 3, 2023 the RBZ increased the foreign currency allocation from 60% to 75%. The allocation percentages remained in effect up to the date of approval of these financial statements. The Company participated in the foreign currency auction introduced by the Zimbabwean Government to exchange RTGS$ for US Dollars up to June 15, 2021.

In June 2021 the RBZ announced that companies that are listed on the VFEX will receive 100% of the revenue arising from incremental production in US Dollars. Blanket has subsequently received confirmation that the “baseline” level of production for the purposes of calculating incremental production is 148.38 Kg per month (approximately 57,000 ounces per annum). The payment of the increased US Dollars proceeds for incremental production was applied from July 1, 2021 and Blanket has received all amounts due in terms of this revised policy up to the date of approval of these financial statements. The arrangement to allow an additional allowance for VFEX listed companies resulted in allocation of approximately 72.74% and was replaced on February 3, 2023 by the 75%:25% allocation for revenues earned.

In applying IAS 21, management determined that the US Dollars remained the primary currency in which the Group’s Zimbabwean entities operate, as:

● | the majority of revenue is received in US Dollars;

● | the gold price receivable was calculated in US Dollars;

● | the majority of costs are calculated by reference to the US Dollars if denominated in RTGS$ or is paid in US Dollars; and

● | Income tax liabilities calculated in RTGS$ are settled predominantly in US Dollars.

The application of IAS 21, the advent of Statutory Instrument 142 (issued by Zimbabwean Government) and the devaluation of the RTGS$ against the US Dollars had an impact on the US Dollars value of RTGS$ denominated monetary assets and liabilities such as income and deferred tax liabilities, loans and borrowings, trade and other payables and to a lesser extent monetary asset such as cash held in RTGS$.

(f) | Finance income and finance cost

Finance income comprises interest income on funds invested. Finance income is recognised as it accrues in profit or loss, using the effective interest method. Finance cost comprise interest expense on the rehabilitation provisions, interest on bank overdraft balances, effective interest on leases, loans and borrowings and also includes commitment costs on overdraft facilities. Finance cost is recognised in profit or loss using the effective interest rate method and excludes borrowing costs capitalised.

F- 17

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(g) | Borrowing costs

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Other borrowing costs are expensed in the period in which they are incurred and recognised as finance cost.

(h) | Taxes

i) | Income tax

Tax expense comprises current and deferred tax. These expenses are recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

ii) | Current tax

Current tax is the tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date. Current tax includes withholding tax on management fees and dividends paid between companies within the Group.

iii) | Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future.

Deferred tax is a monetary item measured at the tax rates and in the currency that are expected to be applied when temporary differences reverse. The tax and exchange rates are based on the laws that have been enacted, substantively enacted or the interbank exchange rates that prevail at the reporting date.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

F- 18

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(i) | Earnings per share

The Group presents basic and diluted earnings per share (“EPS”) data for its shares. Basic EPS is calculated by dividing the adjusted profit or loss attributable to shareholders of the Group (see note 27) by the weighted average number of shares outstanding during the period, adjusted for own shares held. Diluted EPS is determined by adjusting the profit or loss attributable to shareholders and the weighted average number of shares outstanding, adjusted for own shares held, for the effects of all dilutive potential shares, which comprise share options granted to employees and directors.

(j) | Property, plant and equipment

i) | Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use, borrowing costs on qualifying assets, the costs of dismantling and removing the items and restoring the site on which they are located. Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognised in profit or loss. Refer to note 4(c)(ii) for the impairment of non-financial assets.

ii) | Subsequent costs

The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

iii) | Depreciation

Depreciation is calculated to write off the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value. When the asset is ready for use in the manner intended by management, depreciation of mine development, infrastructure and other assets is calculated on the unit-of-production method using the measured, indicated and estimated economical inferred mineral resources in Blanket’s life-of-mine plan (“LoMP”). Resources that are not included in the LoMP are not included in the calculation of depreciation.

For other categories, depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment, since this most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.

Mineral resources and reserves categorised and reported in compliance with the definitions embodied in the CIM Definition Standards as incorporated into the NI 43-101 are reported inclusive of mineral reserves. Mineral resources and reserves categorised and reported in compliance with Subpart 1300 are reported exclusive of mineral reserves.

Inferred mineral resources are considered in the LoMP to the extent these mineral resources are above the cut-off, economically viable and of sufficient confidence, are expected to be upgraded and form part of eventual extraction and as a result are included in the calculation of depreciation. Refer to note 18 for the evaluation of the cut-off.

F- 19

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(j) | Property, plant and equipment (continued)

iii) | Depreciation (continued)

Mineral resources are sub-divided, in order of increasing geological confidence, into inferred, indicated and measured categories. An inferred mineral resource has a lower level of confidence than that applied to an indicated mineral resource. An indicated mineral resource has a higher level of confidence than an inferred mineral resource but has a lower level of confidence than a measured mineral resource.

Mineral resources in the measured and indicated mineral resource classifications have been converted into proven and probable mineral reserves respectively, by applying the applicable modifying factors and reasonable prospects of economic extraction.

Land is not depreciated.

The calculation of the production rate units could be affected to the extent that actual production in the future is different from the current forecast production. This would generally result from the extent to which there are significant changes in any of the factors or assumptions used in estimating mineral reserves and resources.

These factors include:

● | changes in mineral reserves and resources;

● | differences between actual commodity prices and commodity price assumptions;

● | unforeseen operational issues at mine sites; and

● | changes in capital, operating, mining, processing and reclamation costs, discount rates and foreign exchange rates.

The estimated useful lives for 2023, 2022 and 2021 are as follows:

● | buildings 10 to 15 years;

● | plant and equipment 5 to 10 years;

● | fixtures and fittings including computers 4 to 10 years;

● | motor vehicles 4 years;

● | right of use assets 3 to 6 years (determined by lease term); and

● | mine development, infrastructure and other assets in production, units-of-production method.

Depreciation methods, useful lives and residual values are reviewed each financial year and adjusted if appropriate. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Assets under construction’s useful life and residual values will be assessed once the asset is available for use. Refer to note 18 for the change in estimate in plant and equipment.

(k) | Exploration and evaluation assets

Qualifying exploration costs are capitalised as incurred. Costs incurred before the legal rights to explore are obtained are recognised in profit or loss. The costs related to speculative drilling on unestablished orebodies at the Blanket Mine, general administrative or overhead costs are expensed as incurred. Exploration and evaluation costs capitalised are disclosed under Exploration and evaluation assets. Qualifying direct expenditures include such costs as mineral rights, options to acquire mineral rights, materials used, surveying costs, drilling costs, payments made to contractors, direct administrative costs and depreciation on property, plant and equipment during the exploration phase.

F- 20

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(k) | Exploration and evaluation assets (continued)

Costs not directly attributable to exploration and evaluation activities, including general administrative overhead costs, are expensed in the year they occur.

Once the technical feasibility and commercial viability of extracting the mineral resource have been determined, the property is considered to be a mine under development and moved to the mine development, infrastructure and other asset category within property, plant and equipment. Capitalised direct costs related to the acquisition, exploration and development of mineral properties remain capitalised, at their initial cost, until the properties to which they relate are ready for their intended use, sold, abandoned or management has determined there to be impairment. Exploration and evaluation assets are tested for impairment at least annually, and before the assets are transferred to mine development, infrastructure and other assets or when an indicator of impairment is identified.

Exploration and evaluations assets are not depreciated.

(l) | Inventories

Consumable stores are measured at the lower of cost and net realisable value. The cost of consumable stores is based on the weighted average cost principle. It includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their existing location and condition. Gold in process is measured at the lower of cost and net realisable value. The cost of gold in process includes an appropriate share of production overheads based on normal operating capacity and is valued on the weighted average cost principle. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

(m) | Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or less. Bank overdrafts are repayable on demand and form an integral part of the Group’s cash management process. The bank overdraft is included as a component of cash and cash equivalents for the purpose of the statement of cash flows.

(n) | Assets and liabilities associated with assets held for sale

Non-current assets, or disposal groups comprising assets and liabilities, are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.

Such assets, or disposal groups, are generally measured at the lower of their carrying amount or fair value less costs to sell. Impairment losses on initial classification as held for sale or held for distribution and subsequent gains and losses on remeasurement are recognised in profit or loss.

Once classified as held for sale property, plant and equipment are no longer depreciated.

F- 21

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(o) | Financial instruments

i) | Financial assets

The Group had the following financial assets:

Financial assets at amortised cost

Financial assets at amortised cost comprise trade receivables. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised cost using the effective interest method, less any impairment losses. A trade receivable without a significant financing component is initially measured at the transaction price. Refer to note 4(c)(i) for the impairment of receivables.

Fair value through profit or loss

This category comprises the Gold ETF, gold hedge and Put options. These instruments are carried at fair value with changes in fair value recognised in profit or loss as fair value losses on derivative financial instruments. Transaction costs are recognised in profit or loss immediately when incurred. The Group does not have any assets held for trading nor does it voluntarily classify any financial assets as being at fair value through profit or loss. Estimations made and further information is referred to in note 14.

ii) | Financial liabilities

The Group classifies its financial liabilities into one of two categories, depending on the purpose for which the liability was acquired.

Fair value through profit or loss

Derivatives are recognised initially at fair value; attributable transaction costs are recognised in profit or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value. This category comprises the Gold loan, Put options and the Call options. Estimations made and further information is in note 14. All changes in the fair value of derivative instruments are accounted for in profit or loss and all proceeds and acquisitions are classified under investing activities in the consolidated cashflow statement.

Financial liabilities at amortised cost

Non-derivative financial liabilities are recognised initially on the date at which the Group becomes a party to the contractual provisions of the instrument. The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.

Non-derivative financial liabilities consist of bank overdrafts, loans and borrowings and trade and other payables.

Such financial liabilities are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition these financial liabilities are measured at amortised cost using the effective interest method.

Offsetting

Financial assets and liabilities are offset and the net amount is presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

F- 22

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(p) | Share capital

Share capital is classified as equity. Incremental costs directly attributable to the issue, consolidation and repurchase of fractional items of shares and share options are recognised as a deduction from equity, net of any tax effects.

(q) | Provisions

A provision is a liability of uncertain timing and amount. A liability is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability if the time value of money is considered significant. The unwinding of the discount is recognised as a finance cost.

(r) | Site restoration

The Group recognises liabilities for statutory, contractual, constructive or legal obligations associated with the retirement of property, plant and equipment and exploration and evaluation assets, when those obligations result from the acquisition, construction, development or normal operation of these assets. Production phase restoration costs are recognised at the net present value of future rehabilitation cost estimates arising from the decommissioning of plant and other site preparation work is capitalised to mineral properties along with a corresponding increase in the rehabilitation provision in the period incurred. Future rehabilitation costs are discounted using a pre-tax risk-free rate that reflects the time-value of money. For assets in the exploration and the evaluation phase the restoration costs are recognised at the undiscounted current cost. The Group’s estimates of rehabilitation costs, which are reviewed annually, could change as a result of changes in regulatory requirements, discount rates, effects of inflation and assumptions regarding the amount and timing of the future expenditures. These changes are recorded directly to mineral properties with a corresponding entry to the rehabilitation provision. The periodic unwinding of the discount shall be recognised in the profit or loss as a finance costs.

(s) | Leases

The Group recognises a right of use asset and a lease liability at the lease commencement date. The right of use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right of use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right of use asset reflects that the Group will exercise a purchase option. In that case the right of use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as property, plant and equipment. Also, the right of use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

F- 23

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(s) | Leases (continued)

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.

The Group determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.

Lease payments included in the measurement of the lease liability comprise the following:

● | fixed payments, including in-substance fixed payments;

● | amounts expected to be payable under a residual value guarantee; and

● | the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Group is reasonably certain not to terminate early.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee, if the Group changes its assessment of whether it will exercise a purchase, extension or termination option or if the lease agreement changes in substance in terms of payment.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right of use asset or is recorded in profit or loss if the carrying amount of the right of use asset has been reduced to zero.

The Group presents the right of use assets as property, plant and equipment. Lease liabilities are presented separately in the statement of financial position as current- and non-current lease liabilities.

The Group has elected not to recognise the right of use assets and lease liabilities for leases of low-value assets and short-term leases, including IT equipment.

F- 24

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(t) | Employee benefits

i) | Short-term employee benefits

Short-term employee benefits are expensed when the related services are provided. A liability is recognised for the amount expected to be paid, in respect of salaries, annual leave, bonusses and severance packages, if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

ii) | Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit expense in profit or loss in the periods during which services are rendered by employees. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. Contributions to a defined contribution plan that are due more than 12 months after the end of the period in which the employees render the service are discounted to their present value.

F- 25

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(u) | Standards issued but not yet effective

The following standards, amendments to standards and interpretations to existing standards may possibly have an impact on the Group:

Standard/ Interpretation |  | Effective date and expected adoption date*
Classification of Liabilities as Current or Non-current – Amendments to IAS 1 Non-current Liabilities with Covenants – Amendments to IAS 1 |  | Amendments made to IAS 1 Presentation of Financial Statements in 2020 and 2022 aim to clarify the requirement on determining whether liabilities are classified as either current or non-current, depending on the rights that exist at the end of the reporting period. Classification is unaffected by the entity’s expectations or events after the reporting date (e.g. the receipt of a waiver or a breach of covenant). Covenants of loan arrangements will not affect classification of a liability as current or non-current at the reporting date if the entity must only comply with the covenants after the reporting date. However, if the entity must comply with a covenant either before or at the reporting date, this will affect the classification as current or non-current even if the covenant is only tested for compliance after the reporting date. The amendments require disclosures if an entity classifies a liability as non-current and that liability is subject to covenants that the entity must comply with within 12 months of the reporting date. The disclosures include: ● the carrying amount of the liability, ● information about the covenants, and ● facts and circumstances, if any, that indicate that the entity may have difficulty complying with the covenants. The amendments also clarify what IAS 1 means when it refers to the ‘settlement’ of a liability. Terms of a liability that could, at the option of the counterparty, result in its settlement by the transfer of the entity’s own equity instrument can only be ignored for the purpose of classifying the liability as current or non-current if the entity classifies the option as an equity instrument. However, conversion options that are classified as a liability must be considered when determining the current/non-current classification of a convertible note. The amendments must be applied retrospectively in accordance with the normal requirements in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. Special transitional rules apply if an entity had early adopted the 2020 amendments regarding the classification of liabilities as current or non-current. The Group has completed its assessment of the impact of the above standards and concluded that the standard amendments would not have a material impact on the consolidated financial statements. |  | January 1, 2024

F- 26

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

4 | Material accounting policies (continued)

(u) | Standards issued but not yet effective (continued)

The following standards, amendments to standards and interpretations to existing standards may possibly have an impact on the Group:

Standard/ Interpretation |  | Effective date and expected adoption date*
General requirements for Disclosure of Sustainability-related financial information – IFRS S1 Climate-related Disclosures – IFRS S2 |  | IFRS S1 sets out overall requirements for sustainability-related financial disclosures with the objective to require an entity to disclose information about its sustainability-related risks and opportunities that is useful to primary users of general purpose financial reports in making decisions relating to providing resources to the entity. IFRS S2 sets out the requirements for identifying, measuring and disclosing information about climate-related risks and opportunities that is useful to primary users of general purpose financial reports in making decisions relating to providing resources to the entity. In the first annual reporting period in which an entity applies IFRS S1, the entity is permitted to disclose information on only climate-related risks and opportunities (in accordance with IFRS S2). The Group has completed its assessment of the impact of the above standards and concluded that the standard amendments would not have a material impact on the consolidated financial statements. |  | January 1, 2024
Lack of exchangeability – IAS 21 |  | The International Accounting Standards Board has published amendments to IAS 21 that specify how to assess whether a currency is exchangeable and how to determine the exchange rate when it is not. Applying the amendments, a currency is exchangeable when an entity is able to exchange that currency for the other currency through market or exchange mechanisms that create enforceable rights and obligations without undue delay at the measurement date and for a specified purpose. However, a currency is not exchangeable into the other currency if an entity can only obtain no more than an insignificant amount of the other currency at the measurement date for the specified purpose. When a currency is not exchangeable at the measurement date, an entity is required to estimate the spot exchange rate as the rate that would have applied to an orderly exchange transaction at the measurement date between market participants under prevailing economic conditions. In that case, an entity is required to disclose information that enables users of its financial statements to evaluate how the currency’s lack of exchangeability affects, or is expected to affect, the entity’s financial performance, financial position and cash flows. Management is investigating the potential impact of the standard to be amended. |  | January 1, 2025

* Annual periods ending on or after.

New standards, amendments to standards and interpretations adopted from January 1, 2023 had no significant effect on the Group’s accounting policies.

F- 27

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

5 | Tribute Arrangement and Mining Agreement and Bilboes Gold Limited acquisition

On July 21, 2022 Caledonia Holdings Zimbabwe (Private) Limited (“CHZ”) entered into a Tribute Arrangement, and related Mining Agreement with Bilboes Holdings (Private) Limited (“Bilboes Holdings” or “Bilboes”) to mine its oxide and transitional ore (“tribute agreement”). This tribute agreement was specific to the Bilboes oxide mine and Bilboes Holdings was on care and maintenance at the date of the agreement.

In terms of the tribute agreement, Bilboes Holdings granted CHZ the right to mine the Bilboes oxide mine operations for the purpose of extracting and selling gold. In terms of this right, CHZ could operate the Bilboes oxide mine using a combination of Bilboes’ resources and their own, for CHZ’s account.

Subject to the stipulation in the tribute agreement, CHZ assumed all responsibility in connection with the oxide mining claims as if CHZ were the owner thereof and Bilboes Holdings remained the registered holder of the mining claims until ownership passes in terms of the Sale and Purchase Agreement, mentioned below.

In terms of the tribute agreement, CHZ had the right to provide instructions over the scope of works for the Bilboes oxide mine in terms of an operational plan and also had the right to terminate the tribute agreement. CHZ, therefore, had the ability to affect the variable returns of the Bilboes oxide mine and to ensure its returns were in line with the expectation of recouping its “investment” (all funds provided) at a 25% internal rate of return.

The tribute agreement came into effect on August 1, 2022, when the Ministry of Mines’ approval was received, and control was obtained through contractual arrangement.

The Bilboes oxide mine did not have sufficient processes in place to operate the oxide mining operations and was reliant on CHZ to provide instructions on the mining operations to create the necessary outputs. The Bilboes oxide mine was assessed as an asset and liability acquisition and not a business combination in terms of IFRS 3 Business Combinations. Directly attributable costs of bringing the Bilboes oxide mine to the location and condition necessary for it to be capable of operating in the manner intended by CHZ amounted to $872 and was accounted for as property, plant and equipment in the December 31, 2022 consolidated financial statements.

On June 27, 2023 the decision was taken to place the mining tailing activities of the Bilboes oxide mine on care and maintenance as the cost related to removing the waste and accessing the orebody could exceed the benefit from the gold revenues to be received. The impairment loss that was recognised amounted to a carrying value of $851, on impairing the Bilboes oxide asset classified under property, plant and equipment. Mining and tailing activities continued at the Bilboes oxide mine until the end of September 2023 when the contract miner's notice period came to an end. Leaching of material that has already been deposited on the leach pad will continue until no longer economically feasible. Oxide mining and processing will resume when the stripping of the waste for the sulphide project commences and can be economically justified.

In addition to the tribute arrangement, Caledonia signed a conditional agreement (the “Sale and Purchase Agreement”) to purchase 100% of Bilboes Gold Limited (“Bilboes Gold”) on July 21, 2022. Bilboes Gold is the holding company of Bilboes Holdings that owns high-grade sulphide resources and the mentioned mining claims to the oxide mine deposit. It was agreed that Caledonia would purchase Bilboes Gold for a consideration to be settled by issue to the sellers of 5,123,044 new shares in Caledonia, comprising initial consideration shares, escrow consideration shares and deferred consideration shares. In addition to the shares, the agreement was also to grant a 1% net smelter royalty (“NSR”) on the Bilboes’ revenues to one of the sellers, Baker Steel Resources Trust Limited (“Baker Steel”), essentially instead of a number of shares that they would have been entitled to should they have agreed to accept all of their consideration in shares. The Sale and Purchase Agreement gave Caledonia the rights to the sulphide project in addition to the right to mine the Bilboes oxide mine as a result of the tribute agreement.

On January 6, 2023, following the satisfaction of conditions precedent, Caledonia completed the acquisition of Bilboes Gold that gave right to further evaluate and exploit the sulphide resources in addition to the oxide mining activities agreed in the tribute agreement.

F- 28

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

5 | Tribute Arrangement and Mining Agreement and Bilboes Gold Limited acquisition (continued)

The acquisition of Bilboes Gold was classified as an asset and liability acquisition as there were no inputs, processes and outputs and it was not a business combination in terms of IFRS 3 Business Combinations.

Upon completion of the transaction on January 6, 2023, the initial consideration shares were issued, in the amount of 4,425,797 common shares, to the three sellers of Bilboes Gold Limited and the NSR agreement was signed.

The escrow consideration shares of 441,095 common shares of Caledonia were issued to one of the sellers in settlement of a separate commercial arrangement between its subsidiary and the holding company of another seller, and upon receipt by the Company of a “share adjustment notice” instructing the issue of the shares. The share adjustment notice was only issued once approval had been obtained from the Reserve Bank of Zimbabwe for such commercial arrangement. On March 30, 2023, the 441,095 common shares were issued after the share adjustment notice was received.

Deferred consideration shares of 256,152 common shares of Caledonia were issued to the sellers on April 11, 2023. Total consideration shares issued for the acquisition of Bilboes Gold amounted to 5,123,044 shares with the value of the consideration shares set at US$65.677 million. The value of the initial consideration shares issued is based on the last trading day's closing share price on NYSE American LLC before completion of US$12.82 per share.

Consideration paid |  | $'000 |
Equity issued |  |  | 65,677 |
Initial consideration shares issued (4,425,797 at $12.82 per share) |  |  | 56,739 |
Escrow shares issued (441,095 at $12.82 per share) |  |  | 5,655 |
Deferred consideration shares issued (256,152 at $12.82 per share) |  |  | 3,283 |
Bilboes oxide mine assets (pre-acquisition) |  |  | (872 | )
Prepayments - Bilboes pre-effective date costs |  |  | 877 |
Total net consideration |  |  | 65,682 |
Recognised amounts of identifiable assets and liabilities assumed (January 6, 2023) |  |  |  |
Exploration and evaluation assets (note 17) |  |  | 73,198 |
Inventories |  |  | 70 |
Prepayments |  |  | 5 |
Trade and other receivables |  |  | 802 |
Cash and cash equivalents |  |  | 54 |
Provisions |  |  | (4,466 | )
Trade and other payables - external |  |  | (3,943 | )
Lease liabilities |  |  | (28 | )
Income tax payable |  |  | (10 | )
|  |  | 65,682 |

Acquisition-related costs

Included in administrative costs is an amount of $3.1 million payable to two advisors on the successful completion of the Bilboes Gold acquisition.

F- 29

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

6 | Blanket Zimbabwe Indigenisation Transaction

On February 20, 2012 the Group announced it had signed a Memorandum of Understanding (“MoU”) with the Minister of Youth, Development, Indigenisation and Empowerment of the Zimbabwean Government pursuant to which the Group agreed that indigenous Zimbabweans would acquire an effective 51% ownership interest in the Zimbabwean company owning the Blanket Mine (also referred to herein as “Blanket” or “Blanket Mine” as the context requires) for a paid transactional value of $30.09 million. Pursuant to the above, members of the Group entered into agreements with each indigenous shareholder to transfer 51% of the Group’s ownership interest in Blanket Mine whereby it:

● | sold a 16% interest to the National Indigenisation and Economic Empowerment Fund (“NIEEF”) for $11.74 million;

● | sold a 15% interest to Fremiro Investments (Private) Limited (“Fremiro”), which is owned by indigenous Zimbabweans, for $11.01 million;

● | sold a 10% interest to Blanket Employee Trust Services (Private) Limited (“BETS”) for the benefit of present and future managers and employees for $7.34 million. The shares in BETS are held by the Blanket Mine Employee Trust (“Employee Trust”) with Blanket Mine’s employees holding participation units in the Employee Trust; and

● | donated a 10% ownership interest to the Gwanda Community Share Ownership Trust (“Community Trust”). In addition, Blanket Mine paid a non-refundable donation of $1 million to the Community Trust.

The Group facilitated the vendor funding of these transactions which is repaid by way of dividends from Blanket Mine. 80% of dividends declared by Blanket Mine are used to repay such loans and the remaining 20% unconditionally accrues to the respective indigenous shareholders. Following a modification to the interest rate on June 23, 2017, outstanding balances on these facilitation loans attract interest at a rate of the lower of a fixed 7.25% per annum payable quarterly or 80% of the Blanket Mine dividend in the quarter. The timing of the loan repayments depends on the future financial performance of Blanket Mine and the extent of future dividends declared by Blanket Mine. The Group related facilitation loans were transferred as dividends in specie intra-group and now the loans and most of the interest thereon is payable to the Company.

Accounting treatment

The directors of Caledonia Holdings Zimbabwe (Private) Limited (“CHZ”), a wholly-owned subsidiary of the Company, performed an assessment using the requirements of IFRS 10: Consolidated Financial Statements (IFRS 10). It was concluded that CHZ should consolidate Blanket Mine after the indigenisation. The subscription agreements with the indigenous shareholders have been accounted for accordingly as a transaction with non-controlling interests and as a share-based payment transaction.

F- 30

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

6 | Blanket Zimbabwe Indigenisation Transaction (continued)

Accounting treatment

The subscription agreements, concluded on February 20, 2012, were accounted for as follows:

● | Non-controlling interests (“NCI”) were recognised on the portion of shareholding upon which dividends declared by Blanket Mine will accrue unconditionally to equity holders as follows:

| (a) | 20% of the 16% shareholding of NIEEF;

| (b) | 20% of the 15% shareholding of Fremiro; and

| (c) | 100% of the 10% shareholding of the Community Trust.

● | This effectively means that NCI was initially recognised at 16.2% of the net assets of Blanket Mine, until the completion of the transaction with Fremiro, whereby the NCI reduced to 13.2% (see below).

● | The remaining 80% of the shareholding of NIEEF and Fremiro was recognised as NCI to the extent that their attributable share of the net asset value of Blanket Mine exceeds the balance on the facilitation loans, including interest.

● | The transaction with BETS is accounted for in accordance with IAS 19 Employee Benefits (profit sharing arrangement) as the ownership of the shares does not ultimately pass to the employees. The employees are entitled to participate in 20% of the dividends accruing to the 10% shareholding in Blanket Mine if they are employed at the date of such distribution. To the extent that 80% of the attributable dividends exceeds the balance on the BETS facilitation loan, they will accrue to the employees at the date of such declaration.

● | BETS is an entity effectively controlled and consolidated by Blanket Mine. Accordingly, the shares held by BETS are effectively treated as treasury shares in Blanket Mine and no NCI is recognised.

Fremiro purchase agreement

On November 5, 2018 the Company and Fremiro entered into a sale agreement for Caledonia to purchase Fremiro’s 15% shareholding in Blanket Mine. On January 20, 2020 all substantive conditions to the transaction were satisfied. The Company issued 727,266 shares to Fremiro for the cancellation of their facilitation loan and purchase of Fremiro’s 15% shareholding in Blanket Mine. The transaction was accounted for as a repurchase of a previously vested equity instrument. As a result, the Fremiro share of the NCI of $3,600 was derecognised, shares were issued at fair value, the share-based payment reserve was reduced by $2,247 and the Company’s shareholding in Blanket Mine increased to 64% on the effective date.

Blanket Mine’s indigenisation shareholding percentages and facilitation loan balances

|  |  |  |  | Effective |  |  | NCI subject to |  |  | Balance of facilitation loan # |
USD |  | Shareholding |  |  | interest & NCI recognised |  |  |  | facilitation loan |  |  | December 31, 2023 |  |  | December 31, 2022 |
NIEEF |  |  | 16 | % |  |  | 3.2 | % |  |  | 12.8 | % |  |  | 8,489 |  |  |  | 9,414 |
Community Trust |  |  | 10 | % |  |  | 10.0 | % |  |  | 0.0 | % |  |  | – |  |  |  | – |
BETS ~ |  |  | 10 | % |  |  | -* |  |  |  | -* |  |  |  | 4,908 |  |  |  | 5,612 |
|  |  | 36 | % |  |  | 13.2 | % |  |  | 12.8 | % |  |  | 13,397 |  |  |  | 15,026 |

* | The shares held by BETS are effectively treated as treasury shares (see above).
~ | Accounted for under IAS19 Employee Benefits.
# | Facilitation loans are accounted for as equity instruments and are accordingly not recognised as loans receivable.

F- 31

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

6 | Blanket Zimbabwe Indigenisation Transaction (continued)

Accounting treatment (continued)

The balance on the facilitation loans is reconciled as follows:

|  | 2023 |  |  | 2022 |
Balance at January 1 |  |  | 15,026 |  |  |  | 16,712 |
Interest incurred |  |  | 259 |  |  |  | 580 |
Dividends used to repay loan |  |  | (1,888 | ) |  |  | (2,266 | )
Balance at December 31 |  |  | 13,397 |  |  |  | 15,026 |

Advance dividend loans and balances

In anticipation of completing the underlying subscription agreements, Blanket Mine agreed to advance dividend arrangements with NIEEF and the Community Trust. Advances made to the Community Trust against their right to receive dividends declared by Blanket Mine on their shareholding were as follows:

● | a $2 million payment on or before September 30, 2012;

● | a $1 million payment on or before February 28, 2013; and

● | a $1 million payment on or before April 30, 2013.

These advance payments were debited to a loan account bearing interest at a rate at the lower of a fixed 7.25% per annum, payable quarterly or the Blanket Mine dividend in the quarter to the advanced dividend loan holder. The loan is repayable by way of set-off of future dividends on the Blanket Mine shares owned by the Community Trust. Advances made to NIEEF as an advanced dividend loan before 2013 have been settled through Blanket Mine dividend repayments in 2014. The advance dividend payments were recognised as distributions to shareholders and they are classified as equity instruments. The loans arising are not recognised as loans receivables, because repayment is by way of uncertain future dividends. The final payment to settle the advance dividend loan to the Community Trust was made on September 22, 2021. Future dividends to the Community Trust are unencumbered from the date the loan was settled in full.

F- 32

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

7 | Capital management

When managing capital, the Group’s objectives are to safeguard its ability to continue as a going concern in order to pursue the mining operations and exploration potential of the mineral properties. The Group’s capital includes shareholders’ equity, comprising issued share capital (refer to note 25), reserves (refer to note 26), accumulated other comprehensive income, retained loss, bank financing (refer to note 23) and non-controlling interests (refer to note 28).

|  | 2023 |  |  | 2022 |
Total equity |  |  | 264,192 |  |  |  | 193,459 |

The Group’s primary objective regarding its capital management is to ensure that it has sufficient cash resources to maintain its on-going operations, provide returns for shareholders, accommodate any rehabilitation provisions and pursue growth opportunities. It assesses its short term needs and funds these by available cash, overdrafts and short to medium term loans. Capital requirements for future project are evaluated on a case-by-case basis. As at December 31, 2023, there has been no change with respect to the overall capital risk management strategy.

8 | Revenue

|  | Blanket |  |  | Bilboes |  |  | Total |
|  | 2023 |  |  | 2022 |  |  | 2021 |  |  | *2023 |  |  | 2023 |  |  | 2022 |  |  | 2021 |
Revenue |  |  | 140,615 |  |  |  | 142,082 |  |  |  | 121,329 |  |  |  | 5,699 |  |  |  | 146,314 |  |  |  | 142,082 |  |  |  | 121,329 |
Revenue - silver sales |  |  | 114 |  |  |  | 116 |  |  |  | 122 |  |  |  | 4 |  |  |  | 118 |  |  |  | 116 |  |  |  | 122 |
Revenue - gold sales |  |  | 140,501 |  |  |  | 141,966 |  |  |  | 121,207 |  |  |  | 5,695 |  |  |  | 146,196 |  |  |  | 141,966 |  |  |  | 121,207 |
Total ounces gold sold |  |  | 73,482 |  |  |  | 80,094 |  |  |  | 68,617 |  |  |  | 3,050 |  |  |  | 76,532 |  |  |  | 80,094 |  |  |  | 68,617 |
Net work in progress (oz) |  |  | 1,934 |  |  |  | 681 |  |  |  | (1,141 | ) |  |  | – |  |  |  | 1,934 |  |  |  | 681 |  |  |  | (1,141 | )
Gold produced (oz) |  |  | 75,416 |  |  |  | 80,775 |  |  |  | 67,476 |  |  |  | 3,050 |  |  |  | 78,466 |  |  |  | 80,775 |  |  |  | 67,476 |
Tonnes milled |  |  | 770,440 |  |  |  | 752,033 |  |  |  | 665,628 |  |  |  | 154,040 |  |  |  | 924,480 |  |  |  | 752,033 |  |  |  | 665,628 |
Grade (g/t) |  |  | 3.25 |  |  |  | 3.56 |  |  |  | 3.36 |  |  |  | 1.15 |  |  |  |  |  |  |  |  |  |  |  |  |
Recovery (%) |  |  | 93.8 |  |  |  | 93.8 |  |  |  | 93.9 |  |  |  | 54.0 |  |  |  |  |  |  |  |  |  |  |  |  |
Realised gold price ($/oz) |  |  | 1,912 |  |  |  | 1,772 |  |  |  | 1,766 |  |  |  | 1,867 |  |  |  | 1,910 |  |  |  | 1,772 |  |  |  | 1,766 |

* | Bilboes Holdings was acquired on January 6, 2023. No production for 2022 and 2021.

F- 33

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

9 | Production costs

|  | 2023 |  |  | 2022 |  |  | 2021 |
Blanket Mine |  |  | 69,591 |  |  |  | 62,998 |  |  |  | 53,126 |
Salaries and wages |  |  | 25,042 |  |  |  | 23,037 |  |  |  | 20,609 |
Consumable materials |  |  | 24,087 |  |  |  | 23,601 |  |  |  | 17,375 |
Consumable materials – COVID-19 |  |  | – |  |  |  | 311 |  |  |  | 297 |
Electricity costs |  |  | 13,496 |  |  |  | 9,634 |  |  |  | 10,407 |
Safety |  |  | 1,155 |  |  |  | 998 |  |  |  | 774 |
Cash-settled share-based expense (note 12.1(a)) |  |  | 637 |  |  |  | 853 |  |  |  | 692 |
On mine administration |  |  | 2,783 |  |  |  | 2,736 |  |  |  | 1,806 |
Security |  |  | 1,020 |  |  |  | 1,093 |  |  |  | 826 |
Solar operations and maintenance services |  |  | 647 |  |  |  | – |  |  |  | – |
Obsolete inventory |  |  | 283 |  |  |  | 563 |  |  |  | 36 |
Pre-feasibility exploration costs |  |  | 441 |  |  |  | 172 |  |  |  | 304 |
Bilboes |  |  | 13,118 |  |  |  | – |  |  |  | – |
Salaries and wages |  |  | 2,796 |  |  |  | – |  |  |  | – |
Consumable materials |  |  | 8,402 |  |  |  | – |  |  |  | – |
Electricity costs |  |  | 553 |  |  |  | – |  |  |  | – |
Cash-settled share-based expense (note 12.1(a)) |  |  | 23 |  |  |  | – |  |  |  | – |
On mine administration |  |  | 1,344 |  |  |  | – |  |  |  | – |
|  |  | 82,709 |  |  |  | 62,998 |  |  |  | 53,126 |

10 | Other expenses

|  | 2023 |  |  | 2022 |  |  | 2021 |
Intermediated Money Transaction Tax* |  |  | 1,266 |  |  |  | 1,378 |  |  |  | 799 |
COVID-19 donations |  |  | – |  |  |  | – |  |  |  | 74 |
Community and social responsibility cost |  |  | 1,504 |  |  |  | 898 |  |  |  | 1,167 |
Impairment of property, plant and equipment (note 18) |  |  | 877 |  |  |  | 8,209 |  |  |  | 498 |
Impairment of exploration and evaluation assets (note 17) |  |  | – |  |  |  | 467 |  |  |  | 3,837 |
Impairment Solar - VAT and duty receivables (note 21) |  |  | 720 |  |  |  | – |  |  |  | – |
Bilboes pre-acquisition cost @ |  |  | – |  |  |  | 830 |  |  |  | – |
Expected credit losses on deferred consideration on the disposal of subsidiary |  |  | – |  |  |  | – |  |  |  | 761 |
|  |  | 4,367 |  |  |  | 11,782 |  |  |  | 7,136 |

* | Intermediated Money Transfer Tax ("IMTT”) is tax chargeable in Zimbabwe on transfer of physical money, electronically or by any other means, between two or more persons. IMTT is levied at a rate of 2% on RTGS$ denominated transactions and 1% on local foreign currency denominated transactions and outbound foreign payments.
@ | Cost incurred by CHZ between the effective date ( August 1, 2022) and the commencement date of the oxide mining operations ( December 1, 2022) relating to administration and other general costs. These costs were incurred to maintain the operational integrity of the oxide mine and do not relate to direct costs of bringing the oxide mine to the location and condition necessary for it to be capable of operating in the manner intended by CHZ.

F- 34

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

11 | Administrative expenses

|  | 2023 |  |  | 2022 |  |  | 2021 |
Investor relations |  |  | 576 |  |  |  | 663 |  |  |  | 439 |
Audit fee |  |  | 396 |  |  |  | 294 |  |  |  | 267 |
Advisory services fees |  |  | 4,406 |  |  |  | 1,459 |  |  |  | 614 |
Listing fees |  |  | 749 |  |  |  | 512 |  |  |  | 609 |
Directors fees – Company |  |  | 571 |  |  |  | 569 |  |  |  | 527 |
Directors fees – Blanket |  |  | 61 |  |  |  | 56 |  |  |  | 51 |
Employee costs – salaries and bonusses |  |  | 6,734 |  |  |  | 5,855 |  |  |  | 5,462 |
Employee costs – settlements |  |  | 1,784 |  |  |  | – |  |  |  | – |
Other office administration cost |  |  | 445 |  |  |  | 468 |  |  |  | 177 |
Information technology and communication cost – Group related |  |  | 241 |  |  |  | 391 |  |  |  | 178 |
Management liability insurance |  |  | 897 |  |  |  | 985 |  |  |  | 551 |
Travel costs |  |  | 569 |  |  |  | 689 |  |  |  | 216 |
|  |  | 17,429 |  |  |  | 11,941 |  |  |  | 9,091 |

12 | Share-based payments

12.1 | Cash-settled share-based payments

(a) | Restricted Share Units and Performance Units

Certain management and employees within the Group are granted Restricted Share Units (“RSUs”) and Performance Units (”PUs”) pursuant to provisions of the 2015 Omnibus Equity Incentive Compensation Plan (“OEICP”). All RSUs and PUs were granted and approved at the discretion of the Compensation Committee of the Board of Directors.

RSUs vest three years after grant date given that the service conditions of the relevant employees have been fulfilled. The value of the vested RSUs is the number of RSUs vested multiplied by the fair market value of the Company’s shares, as specified by the OEICP, on the date of settlement.

PUs have a performance condition based on gold production and, in recent awards, average normalised controllable cost per ounce of gold and a performance period of one to three years. The number of PUs that vest will be the relevant portion of the PUs granted multiplied by the performance multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.

RSU holders are entitled to receive dividends over the vesting period. Such dividends will be reinvested in additional RSUs at the then applicable share price. PUs have rights to dividends only after they have vested.

RSUs and PUs allow for settlement of the vesting date value in cash or, subject to conditions, shares issuable at fair market value or a combination of both at the discretion of the unitholder.

The fair value of the RSUs at the reporting date was based on the Black Scholes option valuation model less the fair value of the expected dividends during the vesting period multiplied by the performance multiplier expectation. The fair value of the PUs at the reporting date was based on the Black Scholes option valuation model. At the reporting date it was assumed that there is a 93%-100% probability that the performance conditions will be met and therefore a 93%-100% (2022: 93%-100%) average performance multiplier was used in calculating the estimated liability.

The liability as at December 31, 2023 amounted to $1,294 ( December 31, 2022: $2,217). Included in the liability as at December 31, 2023 is an amount of $660 (2022: $853, 2021: $692) that was expensed and classified as production costs; refer to note 9.

F- 35

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

12 | Share-based payments (continued)

12.1 | Cash-settled share-based payments (continued)

(a) | Restricted Share Units and Performance Units (continued)

The cash-settled share-based expense for PUs for the period amounted to $463 (2022: $609, 2021: $477). During the period PUs to the value of $351 were settled in share capital (net of employee tax) (2022: $804, 2021: $Nil) with the employee tax portion recognised in profit or loss.

The following assumptions were used in estimating the fair value of the cash-settled share-based payment liability on December 31:

|  | December 31, 2023 |  |  | December 31, 2022 |
|  | RSUs |  |  | PUs |  |  | RSUs |  |  | PUs |
Risk free rate |  |  | – |  |  |  | 3.88 | % |  |  | 3.88 | % |  |  | 3.88 | %
Fair value (USD) |  |  | – |  |  |  | 12.20 |  |  |  | 12.52 |  |  |  | 12.42 |
Share price (USD) |  |  | – |  |  |  | 12.20 |  |  |  | 12.40 |  |  |  | 12.42 |
Performance multiplier percentage |  |  | – |  |  |  | 93-100 | % |  |  | – |  |  |  | 93-100 | %
Volatility |  |  | – |  |  |  | 0.90 |  |  |  | 1.29 |  |  |  | 0.91 |

Share units granted: |  | RSUs |  |  | PUs |  |  | RSUs |  |  | PUs |
Grant - January 11, 2019 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 95,740 |
Grant - March 23, 2019 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 28,287 |
Grant - June 8, 2019 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 14,672 |
Grant - January 11, 2020 |  |  | 17,585 |  |  |  | 69,678 |  |  |  | 17,585 |  |  |  | 114,668 |
Grant - March 31, 2020 |  |  | – |  |  |  | 696 |  |  |  | – |  |  |  | 1,971 |
Grant - June 1, 2020 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 1,740 |
Grant - September 9, 2020 |  |  | – |  |  |  | 697 |  |  |  | – |  |  |  | 1,611 |
Grant - September 14, 2020 |  |  | – |  |  |  | 5,300 |  |  |  | – |  |  |  | 20,686 |
Grant - October 5, 2020 |  |  | – |  |  |  | 230 |  |  |  | – |  |  |  | 514 |
Grant - January 11, 2021 |  |  | – |  |  |  | 56,244 |  |  |  | – |  |  |  | 78,875 |
Grant - April 1, 2021 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 770 |
Grant - May 14, 2021 |  |  | – |  |  |  | 964 |  |  |  | – |  |  |  | 2,389 |
Grant - June 1, 2021 |  |  | – |  |  |  | 1,310 |  |  |  | – |  |  |  | 1,692 |
Grant - June 14, 2021 |  |  | – |  |  |  | 398 |  |  |  | – |  |  |  | 507 |
Grant - August 13, 2021 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 2,283 |
Grant - September 1, 2021 |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 553 |
Grant - September 6, 2021 |  |  | – |  |  |  | 458 |  |  |  | – |  |  |  | 531 |
Grant - September 20, 2021 |  |  | – |  |  |  | 460 |  |  |  | – |  |  |  | 526 |
Grant - October 1, 2021 |  |  | – |  |  |  | 1,016 |  |  |  | – |  |  |  | 2,530 |
Grant - October 11, 2021 |  |  | – |  |  |  | 450 |  |  |  | – |  |  |  | 500 |
Grant - November 12, 2021 |  |  | – |  |  |  | 1,846 |  |  |  | – |  |  |  | 1,998 |
Grant - December 1, 2021 |  |  | – |  |  |  | 900 |  |  |  | – |  |  |  | 936 |
Grant - January 11, 2022 |  |  | – |  |  |  | 75,198 |  |  |  | – |  |  |  | 96,359 |
Grant - January 12, 2022 |  |  | – |  |  |  | 825 |  |  |  | – |  |  |  | 825 |
Grant - May 13, 2022 |  |  | – |  |  |  | 2,040 |  |  |  | – |  |  |  | 2,040 |
Grant - June 1, 2022 |  |  | – |  |  |  | 1,297 |  |  |  | – |  |  |  | 1,297 |
Grant - July 1, 2022 |  |  | – |  |  |  | 2,375 |  |  |  | – |  |  |  | 2,375 |
Grant - October 1, 2022 |  |  | – |  |  |  | 2,024 |  |  |  | – |  |  |  | 2,024 |
Grant - April 7, 2023 |  |  | – |  |  |  | 79,521 |  |  |  | – |  |  |  | – |
Grant - May 15, 2023 |  |  | – |  |  |  | 581 |  |  |  | – |  |  |  | – |
Grant - June 1, 2023 |  |  | – |  |  |  | 617 |  |  |  | – |  |  |  | – |
Grant - June 7, 2023 |  |  | – |  |  |  | 572 |  |  |  | – |  |  |  | – |
Grant - August 10, 2023 |  |  | – |  |  |  | 5,514 |  |  |  | – |  |  |  | – |
Grant - September 1, 2023 |  |  | – |  |  |  | 1,617 |  |  |  | – |  |  |  | – |
Grant - October 3, 2023 |  |  | – |  |  |  | 14,258 |  |  |  | – |  |  |  | – |
RSU dividends reinvested |  |  | 1,980 |  |  |  | – |  |  |  | 1,980 |  |  |  | – |
Settlements/terminations |  |  | (19,565 | ) |  |  | (144,772 | ) |  |  | – |  |  |  | (254,491 | )
Total awards outstanding |  |  | - |  |  |  | 182,314 |  |  |  | 19,565 |  |  |  | 224,408 |

F- 36

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

12 | Share-based payments (continued)

12.2 | Equity-settled share-based payments

(a) | EPUs

PUs which are classified as equity-settled (i.e. there is no option to vest in cash) (“EPUs”) have a performance condition based on gold production, average normalised controllable cost per ounce of gold and a performance period of three years. The number of EPUs that vest will be the relevant portion of the EPUs granted multiplied by the performance multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.

EPUs have rights to dividends only after they have vested.

The shares issued are subject to a minimum holding period of until at least the first anniversary of the EPUs vesting date.

The fair value of the EPUs at the reporting date was based on the Black Scholes option valuation model less the fair value of the expected dividends during the vesting period multiplied by the performance percentage. At the reporting date it was assumed that there is a 100% probability that the performance conditions will be met and therefore a 100% performance multiplier was used in calculating the expense. The equity-settled share-based expense for EPUs as at December 31, 2023 amounted to $640 (2022: $417, 2021: $Nil).

The following assumptions were used in estimating the fair value of the equity-settled share-based payment on:

Grant date |  | January 24, 2022 |  |  | April 7, 2023 |
Number of units – remaining at reporting date |  |  | 113,693 |  |  |  | 80,773 |
Share price (USD) - grant date |  |  | 11.50 |  |  |  | 16.91 |
Fair value (USD) - grant date |  |  | 10.15 |  |  |  | 15.33 |
Performance multiplier percentage at grant date |  |  | 100 | % |  |  | 100 | %

(b) | Share option programs

The maximum term of the options under the OEICP is ten years. Equity-settled share-based payments under the OEICP will be settled by physical delivery of shares. Under the OEICP the aggregate number of shares that may be issued pursuant to the grant of options, or under any other share compensation arrangements of the Company, will not exceed 10% of the aggregate issued and outstanding shares issued of the Company. At December 31, 2023 the Company had 20,000 options outstanding granted to the employees of 3PPB Plc (providing US investor relations services to Caledonia), P Chidley and P Durham in equal units each.

The fair value of share-based payments noted above was estimated using the Black-Scholes valuation model as the fair value of the services could not be estimated reliably. Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value.

The equity-settled share-based expense relating to grants amounted to $Nil (2022: $67, 2021: $Nil).

F- 37

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

13 | Net foreign exchange (loss) gain

On October 1, 2018 the RBZ issued a directive to Zimbabwean banks to separate foreign currency from RTGS$ in the accounts held by their clients and pegged the RTGS$ at 1:1 to the US Dollar. On February 20, 2019 the RBZ issued a further monetary policy statement, which allowed inter-bank trading between RTGS$ and foreign currency. The interbank rate was introduced at 2.5 RTGS$ to 1 US Dollar and traded at 6,104.72 RTGS$ to 1 US Dollar as at December 31, 2023 ( December 31, 2022: 684.33 RTGS$). The US dollar has remained the primary currency in which the Group’s Zimbabwean entities operate and the functional currency of these entities.

In June 2021 the RBZ announced that companies that are listed on the Victoria Falls Stock Exchange (“VFEX”) will receive 100% of the revenue arising from incremental production in US Dollars. Blanket has subsequently received confirmation that the “baseline” level of production for the purposes of calculating incremental production is 148.38 Kg per month (approximately 57,000 ounces per annum). The payment of the increased US Dollars proceeds for incremental production was applied from July 1, 2021. In December 2021, Caledonia obtained a secondary listing on the VFEX and Blanket received all amounts due in terms of that revised policy. The CMCL listing on the VFEX enabled Blanket to receive approximately 72.74% of its total revenue in US Dollars and the balance in RTGS$.

On February 3, 2023, the RBZ issued Exchange control directive RY002/2023 stating that with effect from February 6, 2023, the US$ export retention threshold across all sectors, including companies listed on the VFEX, had been standardized to 75% of export proceeds. The incremental export incentive scheme was also discontinued with effect from February 1, 2023.

On April 5, 2024 the Reserve Bank of Zimbabwe issued a Monetary Statement policy that introduced a structured currency (which is generally defined as a currency that is pegged to a specific exchange rate or currency basket and backed by a bundle of foreign exchange assets (including gold). The structured currency called the Zimbabwe Gold (“ZiG”) replaced the RTGS$ from the said date. Banks were instructed to convert the RTGS$ balances into the new currency to foster simplicity, certainty, and predictability in monetary and financial affairs. The new currency will co-circulate with other foreign currencies in the economy. The retention threshold remained unchanged.

The table below illustrates the effect the weakening of the RTGS$ and other foreign currencies had on the consolidated statement of profit or loss.

|  | 2023 |  |  | 2022 |  |  | 2021 |
Unrealised foreign exchange gain |  |  | 4,217 |  |  |  | 12,736 |  |  |  | 2,755 |
Realised foreign exchange loss* |  |  | (6,767 | ) |  |  | (8,325 | ) |  |  | (1,571 | )
Net foreign exchange (loss) gain |  |  | (2,550 | ) |  |  | 4,411 |  |  |  | 1,184 |

* | Realised foreign exchange losses were predominantly recognised on bullion sales receivables, bank balances and RTGS$ VAT.
** | After December 31, 2023 the RTGS$:USD conversion rate devalued from RTGS$ 6,105:USD 1 to RTGS$ 20,945:USD 1 on March, 25 2024. The devaluation in the exchange rate will devalue RTGS$-denominated monetary assets in quarter 1, of 2024.

F- 38

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

14 | Derivative financial instruments

The fair value of derivative financial instruments not traded in an active market is determined by using valuation techniques. These valuation techniques maximize the use of observable market data where available. The company did not apply hedge accounting to the derivative financial instruments and all fair value losses were recorded in the consolidated statements of profit or loss and other comprehensive income. Transaction costs are recognised in profit or loss as incurred.

Derivative financial instrument expenses |  |  | 2023 |  |  | 2022 |  |  | 2021 |
Put options | 14.1(a) |  |  | 1,097 |  |  |  | 38 |  |  |  | – |
Gold purchase options | 14.2(a) |  |  | 22 |  |  |  | – |  |  |  | – |
Gold loan | 14.2(b) |  |  | – |  |  |  | (228 | ) |  |  | 21 |
Call options (December 13, 2021) | 14.2(b) |  |  | – |  |  |  | (240 | ) |  |  | – |
Cap and collar options and Call options | 14.2(c) |  |  | – |  |  |  | 832 |  |  |  | 114 |
Call options transaction costs (March 9, 2022) | 14.2(c) |  |  | – |  |  |  | 796 |  |  |  | – |
Gold exchange-traded fund ("Gold ETF") |  |  | – |  |  |  | – |  |  |  | 105 |
|  |  |  | 1,119 |  |  |  | 1,198 |  |  |  | 240 |
Cash flows arising from investing activities |  |  |  |  |  |  |  |  |  |  |  |  |
Acquisition of Put options | 14.1(a) |  |  | (946 | ) |  |  | (478 | ) |  |  | – |
Proceeds from derivative financial liabilities – Gold purchase options | 14.2(a) |  |  | 178 |  |  |  | – |  |  |  | – |
Proceeds from derivative financial assets - Gold ETF |  |  | – |  |  |  | – |  |  |  | 1,066 |
|  |  |  | (768 | ) |  |  | (478 | ) |  |  | 1,066 |
Cash flows arising from financing activities |  |  |  |  |  |  |  |  |  |  |  |  |
Gold loan (repayment) proceeds | 14.2(b) |  |  | – |  |  |  | (3,698 | ) |  |  | 2,752 |
Call options (December 13, 2021) proceeds | 14.2(b) |  |  | – |  |  |  | – |  |  |  | 208 |
Call options (March 9, 2022) acquisition | 14.2(c) |  |  | – |  |  |  | (176 | ) |  |  | – |
Call options (March 9, 2022) proceeds | 14.2(c) |  |  | – |  |  |  | 416 |  |  |  | – |
|  |  |  | – |  |  |  | (3,458 | ) |  |  | 2,960 |

14.1 | Derivative financial assets

|  |  | 2023 |  |  | 2022 |
Put options | 14.1(a) |  |  | 88 |  |  |  | 440 |
|  |  |  | 88 |  |  |  | 440 |

(a) | Put options

On December 19, 2023 the Company purchased put options to hedge 12,000 ounces of gold over a period of three months from January to March 2024 at a strike price of $1,950.

On September 29, 2023 and October 6, 2023 the Company purchased two gold purchase options of 1,000 ounces each at a market price of $1,875 and $1,841 per ounce.

On May 22, 2023 the Company purchased put options to hedge 28,000 ounces of gold over a period of seven months from June to December 2023 at a strike price of $1,900.

On December 22, 2022 the Company purchased put options to hedge 16,672 ounces of gold over a period of five months from December to May 2023 at a strike price of $1,750.

F- 39

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

14 | Derivative financial instruments (continued)

14.1 | Derivative financial assets (continued)

(a) | Put options (continued)

The put options (together “the Put options”) were classified as level 1 in the fair value hierarchy.

On March 7, 2024 the Company purchased put options to hedge 12,000 ounces of gold over a period of three months from April to June 2024 at a strike price of $2,050.

On April 10, 2024 the Company purchased put options to hedge 12,000 ounces of gold over a period of three months from July to September 2024 at a strike price of $2,100.

14.2 | Derivative financial liabilities

|  |  | 2023 |  |  | 2022 |
Gold purchase options | 14.2(a) |  |  | – |  |  |  | – |
Gold loan | 14.2(b) |  |  | – |  |  |  | – |
Call options (December 13, 2021) | 14.2(b) |  |  | – |  |  |  | – |
Cap and collar options and Call options | 14.2(c) |  |  | – |  |  |  | – |
|  |  |  | – |  |  |  | – |

(a) | Gold purchase options

On September 29, 2023 and October 6, 2023 the Company purchased two gold purchase options of 1,000 ounces each at a market price of $1,875 and $1,841 per ounce. The gold purchase options were purchased when the gold price was below $1,900 per ounce at the date of gold revenue delivery. This was done to match the expiry date of the Call options expiring on October 26, 2023 with the date of the gold sales from Blanket, by buying the gold options, in the event that the gold price was below $1,900 at date of pricing of the gold revenue sales by Blanket. Proceeds of $178 were received in October 2023 on in the money options exercised.

(b) | Gold loan and Call options

On December 13, 2021 the Company entered into two separate gold loan and option agreements with Auramet International LLC (“Auramet”).

In terms of the agreements the Group:

● | received $3 million less transaction costs from Auramet at inception of the gold loan agreement (the “Gold loan”);

● | is required to make two deliveries of 925 ounces each on May 31, 2022 and June 30, 2022 in repayment of the Gold loan or pay the equivalent in cash; and

● | granted call options (the “Call options”) on 6,000 ounces to Auramet with a strike price of $2,000 per ounce, expiring monthly in equal monthly tranches from June 30, 2022 to November 30, 2022.

F- 40

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

14 | Derivative financial instruments (continued)

14.2 | Derivative financial liabilities (continued)

(b) | Gold loan and Call options (continued)

Accounting for the Gold loan and the Call options transactions:

● | At inception the fair value of the Gold loan was calculated at the amount received less the fair value of the Call options.

● | As at March 31, 2022 the fair value of the gold loan was calculated by discounting the fair value of the gold deliveries at a forward rate of $1,833 due by a market related discount rate.

● | At inception and at March 31, 2022 the Call options were valued at the quoted prices available from the CME Group Inc. at each respective date.

● | Differences in the fair values were accounted for as Fair value losses on derivative financial instruments in the consolidated statement of profit or loss and other comprehensive income.

● | The Call options were classified as level 1 in the fair value hierarchy and the Gold loan as level 2.

● | Derivative liabilities are not designated as hedging instruments.

Proceeds received under the Gold loan and Call options agreements were allocated as follows:

December 13, 2021 |  |  |  |
Net proceeds received |  |  | 2,960 |
Fair value of Call options |  |  | 208 |
Fair value of Gold loan |  |  | 2,752 |

The Gold loan was settled in full on June 30, 2022. The remaining Call options, outstanding as at September 30, 2022, expired on October 31, 2022 and November 30, 2022.

(c) | Cap and collar options and Call options

On February 17, 2022 the Company entered into a zero cost contract to hedge 20,000 ounces of gold over a period of 5 months from March to July 2022. The hedging contract had a cap of $1,940 and a collar of $1,825 over 4,000 ounces of gold per month expiring at the end of each month over the 5-month period.

On March 9, 2022 in response to a very volatile gold price the Company purchased a matching quantity of Call options at a strike price above the cap at a total cost of $796 over 4,000 ounces of gold per month at strike prices of $2,100 per ounce from March 2022 to May 2022 and $2,200 per ounce from June 2022 to July 2022 in order to limit margin exposure and reinstate gold price upside above the strike price.

In April, 2022 Auramet and the Company each purchased matching quantities of Call options at a net settlement cost to the Company of $176 over 2,400 ounces of gold per month at strike prices of $1,886 and $1,959.50 respectively. These options were purchased to hedge against a short term increase in the gold price for the last week of April 2022. At the 2022 year end both these options expired.

The Cap and collar options and Call options were classified as level 1 in the fair value hierarchy.

F- 41

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

15 | Finance income and finance cost

|  | 2023 |  |  | 2022 |  |  | 2021 |
Finance income received - Bank |  |  | 39 |  |  |  | 17 |  |  |  | 14 |
Unwinding of rehabilitation provision (note 29) |  |  | 109 |  |  |  | 132 |  |  |  | – |
Finance cost - Leases (note 19) |  |  | 22 |  |  |  | 31 |  |  |  | 24 |
Zimbabwe Electricity Supply Authority interest |  |  | 68 |  |  |  | – |  |  |  | 226 |
Finance cost – Overdraft and term loans |  |  | 1,657 |  |  |  | 192 |  |  |  | 86 |
Finance cost - Motapa loan notes payable (note 30.1) |  |  | 619 |  |  |  | 302 |  |  |  | – |
Finance cost - Solar loan notes payable (note 30.2) |  |  | 549 |  |  |  | – |  |  |  | – |
Finance cost - Term loan |  |  | – |  |  |  | – |  |  |  | 56 |
Finance cost - Capitalised to property, plant and equipment (note 18) |  |  | – |  |  |  | – |  |  |  | (17 | )
|  |  | 3,024 |  |  |  | 657 |  |  |  | 375 |

Refer to note 23 for finance costs paid on overdrafts and term loans. Refer to note 30 for finance costs paid on loan notes.

16 | Tax expense

|  | 2023 |  |  | 2022 |  |  | 2021 |
Tax recognised in profit or loss |  |  |  |  |  |  |  |  |  |  |  |
Current tax |  |  | 7,642 |  |  |  | 9,932 |  |  |  | 9,051 |
Income tax - current year |  |  | 4,821 |  |  |  | 8,707 |  |  |  | 8,769 |
Income tax - change in tax estimate |  |  | 1,944 |  |  |  | (46 | ) |  |  | (168 | )
Withholding tax - current year |  |  | 867 |  |  |  | 1,271 |  |  |  | 450 |
Acquisition of Bilboes Gold tax liability (note 5) |  |  | 10 |  |  |  | - |  |  |  | - |
Deferred tax expense |  |  | 5,168 |  |  |  | 6,838 |  |  |  | 5,806 |
Origination and reversal of temporary differences |  |  | 5,168 |  |  |  | 6,838 |  |  |  | 5,806 |
Tax expense – recognised in profit or loss |  |  | 12,810 |  |  |  | 16,770 |  |  |  | 14,857 |
Tax recognised in other comprehensive income |  |  |  |  |  |  |  |  |  |  |  |
Income tax - current year |  |  | - |  |  |  | - |  |  |  | - |
Tax expense |  |  | 12,810 |  |  |  | 16,770 |  |  |  | 14,857 |

F- 42

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

16 | Tax expense (continued)

Unrecognised deferred tax assets

|  | 2023 |  |  | 2022 |  |  | 2021 |
Bilboes Holdings (Private) Limited* |  | 4,447 |  |  | - |  |  | - |
Caledonia Holdings Zimbabwe (Private) Limited – mining |  | 2,942 |  |  | - |  |  | - |
Caledonia Holdings Zimbabwe (Private) Limited - services |  | 1,805 |  |  | 1,805 |  |  | 1,205 |
Blanket Employee Trust Services (Private) Limited |  | 260 |  |  | 227 |  |  | 130 |
Caledonia Mining Services (Private) Limited |  | - |  |  | 69 |  |  | 5 |
Greenstone Management Services (Pty) Ltd (UK) @ |  | 144 |  |  | 176 |  |  | 139 |
Tax losses carried forward |  | 9,598 |  |  | 2,277 |  |  | 1,479 |

Taxable losses do not expire for the entities incurring taxable losses within the Group, unless the entities cease trading. Tax losses carried forward relate to Caledonia Holdings Zimbabwe (Private) Limited and Bilboes Holdings (Private) Limited. Deferred tax assets have not been recognised in these entities as future taxable income is not deemed probable to utilise these losses against.

* | Assessed losses of Bilboes of $3,763 was acquired during 2023.
@ | Assessed losses of Greenstone Management Services (Pty) Ltd (UK) are not carried over and reset to zero each year.

Tax paid |  | 2023 |  |  | 2022 |  |  | 2021 |
Net income tax payable at January 1 |  | (1,284 | ) |  | (1,461 | ) |  | (419 | )
Current tax expense |  | (7,642 | ) |  | (9,932 | ) |  | (9,051 | )
Acquisition of Bilboes Gold tax liability (note 5) |  | (10 | ) |  | – |  |  | – |
Foreign currency movement |  | 840 |  |  | 3,243 |  |  | 583 |
Tax paid |  | 9,206 |  |  | 6,866 |  |  | 7,426 |
Net income tax receivable/ (payable) at December 31 |  | 1,110 |  |  | (1,284 | ) |  | (1,461 | )

F- 43

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

16 | Tax expense (continued)

Reconciliation of tax rate |  |  |  |  |  |  |  |  |  |  |  |
Profit for the year |  |  | (618 | ) |  |  | 22,866 |  |  |  | 23,142 |
Total tax expense |  |  | 12,810 |  |  |  | 16,770 |  |  |  | 14,857 |
Profit before tax |  |  | 12,192 |  |  |  | 39,636 |  |  |  | 37,999 |
Income tax at Company's domestic tax rate (1) |  |  | - |  |  |  | - |  |  |  | - |
Tax rate differences in foreign jurisdictions (2) |  |  | 5,808 |  |  |  | 12,600 |  |  |  | 11,847 |
Effect of income tax calculated in RTGS$ as required by PN26 (3) |  |  | - |  |  |  | 713 |  |  |  | 590 |
Management fee – withholding tax on deemed dividend portion |  |  | 398 |  |  |  | 247 |  |  |  | 342 |
Management fee – non-deductible deemed dividend |  |  | 675 |  |  |  | 735 |  |  |  | 611 |
Management fee – withholding tax - current year |  |  | 169 |  |  |  | 174 |  |  |  | 148 |
Withholding tax on intercompany dividends |  |  | 300 |  |  |  | 850 |  |  |  | - |
Non-deductible expenditure |  |  |  |  |  |  |  |  |  |  |  |
- Donations |  |  | 318 |  |  |  | 269 |  |  |  | 311 |
- Other non-deductible expenditure |  |  | 37 |  |  |  | 1,613 |  |  |  | 904 |
Unrealised foreign exchange gains |  |  | (642 | ) |  |  | (1,322 | ) |  |  | (614 | )
Change in tax estimates |  |  |  |  |  |  |  |  |  |  |  |
- Zimbabwean income tax |  |  | 1,891 |  |  |  | - |  |  |  | (166 | )
- South African income tax |  |  | 53 |  |  |  | (46 | ) |  |  | (2 | )
Change in unrecognised tax losses |  |  | 3,803 |  |  |  | 937 |  |  |  | 886 |
Tax expense - recognised in profit or loss |  |  | 12,810 |  |  |  | 16,770 |  |  |  | 14,857 |

(1) | The tax rate in Jersey, Channel Islands is 0% (2022: 0%, 2021: 0%).
(2) | The effective tax rate of 105.07% (2022: 42.31%) exceeds the statutory tax rates of subsidiaries of the Company, as certain expenditures are incurred by the Company that are not tax-deductible against taxable income in Zimbabwe and South Africa, where the enacted tax rates are 24.72% (2022: 24.72%) and 27.00% (2022: 28%) respectively.
(3) | In 2019 ZIMRA issued PN26 that was affected retrospectively from February 22, 2019. The public notice provided clarity on Section 4 (a) of the Finance Act [Chapter 23.04] of Zimbabwe, which required that the calculation of taxable income be performed in RTGS$ and that the payment of the tax be in the ratio of the currency that the taxable income and revenue is earned. The reconciling item reconciled the profit before tax calculated using US Dollars as the functional currency of the Zimbabwean entities to taxable income calculated in RTGS$. PN26 was superseded by Section 37AA of the Income Tax Act [Chapter 23:06] of Zimbabwe, which requires taxpayers to submit separate tax returns where any part of the income from trade or investment is earned in foreign currency. Section 37AA stated that the calculation of taxable income be expressed in foreign currency and RTGS$ and that the payment of the tax payable be made proportionately to reflect the percentage share of income earned in all foreign currencies and the percentage earned in Zimbabwe dollars. The section further provides that the RTGS$ should be converted to US$ using the average auction rate of exchange for the year of assessment, with the same being applicable to US$ amounts that need to be converted to RTGS$.

On November 30,2023, the Zimbabwean Government announced in the 2024 National Budget Statement that the income tax rate will increase from 24.72% to 25.75% with effect from January 1, 2024. This was gazetted into law on December 30, 2023.

The South African Government announced in the 2021 National Budget Statement that the income tax rate will be reduced from 28.00% to 27.00% for the years of assessment ending on and after March 31, 2023. This resulted in a change in the estimated deferred tax asset.

F- 44

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

16 | Tax expense (continued)

Recognised deferred tax assets and liabilities

|  | Assets |  |  | Liabilities |  |  | Net |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Property, plant and equipment |  | - |  |  | - |  |  | (6,348 | ) |  | (6,323 | ) |  | (6,348 | ) |  | (6,323 | )
Exploration and evaluation assets |  | - |  |  | - |  |  | (146 | ) |  | (2 | ) |  | (146 | ) |  | (2 | )
Inventories – obsolete stock |  | 65 |  |  | (163 | ) |  | - |  |  | - |  |  | 65 |  |  | (163 | )
Prepayments |  | - |  |  | - |  |  | (9 | ) |  | (5 | ) |  | (9 | ) |  | (5 | )
Unrealised foreign exchange |  | - |  |  | 733 |  |  | - |  |  | - |  |  | - |  |  | 733 |
Trade and other payables |  | 190 |  |  | 814 |  |  | - |  |  | - |  |  | 190 |  |  | 814 |
Provisions |  | 204 |  |  | 25 |  |  | - |  |  | - |  |  | 204 |  |  | 25 |
Other |  | 66 |  |  | - |  |  | - |  |  | - |  |  | 66 |  |  | - |
Tax assets/ (liabilities) |  | 525 |  |  | 1,409 |  |  | (6,503 | ) |  | (6,330 | ) |  | (5,978 | )* |  | (4,921 | )*

* | The net deferred tax liability consists of a deferred tax asset of $153 (2022: $202) from the South African operation and a net deferred tax liability of $6,131 (2022: $5,123) due to the Zimbabwean operation. The amounts are in different tax jurisdictions and cannot be offset. The amounts are presented as part of non-current assets and non-current liabilities in the statements of financial position. The deferred tax asset recognised is supported by evidence of probable future taxable income.

Movement in recognised deferred tax assets and liabilities

|  | Balance January 1, 2023 |  |  | Recognised in profit or loss |  |  | Foreign exchange movement |  |  | Balance December 31, 2023 |
Property, plant and equipment |  | (6,323 | ) |  | (5,737 | ) |  | 5,712 |  |  | (6,348 | )
Exploration and evaluation assets |  | (2 | ) |  | - |  |  | (144 | ) |  | (146 | )
Inventories – obsolete stock |  | (163 | ) |  | 90 |  |  | 138 |  |  | 65 |
Prepayments |  | (5 | ) |  | (5 | ) |  | 1 |  |  | (9 | )
Unrealised foreign exchange |  | 733 |  |  | - |  |  | (733 | ) |  | - |
Trade and other payables |  | 814 |  |  | (111 | ) |  | (513 | ) |  | 190 |
Provisions |  | 25 |  |  | 529 |  |  | (350 | ) |  | 204 |
Other |  | - |  |  | 66 |  |  | - |  |  | 66 |
Tax (liabilities)/ assets |  | (4,921 | ) |  | (5,168 | ) |  | 4,111 |  |  | (5,978 | )

|  | Balance January 1, 2022 |  |  | Recognised in profit or loss |  |  | Foreign exchange movement |  |  | Balance December 31, 2022 |
Property, plant and equipment |  | (9,328 | ) |  | (8,560 | ) |  | 11,565 |  |  | (6,323 | )
Exploration and evaluation assets |  | (47 | ) |  | 10 |  |  | 35 |  |  | (2 | )
Inventories - obsolete stock |  | 3 |  |  | (295 | ) |  | 129 |  |  | (163 | )
Prepayments |  | (10 | ) |  | 4 |  |  | 1 |  |  | (5 | )
Unrealised foreign exchange |  | 499 |  |  | 1,179 |  |  | (945 | ) |  | 733 |
Trade and other payables |  | 989 |  |  | 794 |  |  | (969 | ) |  | 814 |
Provisions |  | 54 |  |  | 30 |  |  | (59 | ) |  | 25 |
Tax (liabilities)/ assets |  | (7,840 | ) |  | (6,838 | ) |  | 9,757 |  |  | (4,921 | )

F- 45

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

17 | Exploration and evaluation assets

|  | Bilboes Gold |  |  | Motapa |  |  | Maligreen |  |  | Connemara North |  |  | GG |  |  | Sabiwa |  |  | Abercorn |  |  | Valentine |  |  | Total |
Balance at January 1, 2022 |  | – |  |  | – |  |  | 4,196 |  |  | 463 |  |  | 3,618 |  |  | 290 |  |  | 16 |  |  | 65 |  |  | 8,648 |
Acquisition costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Mining claims acquired |  | – |  |  | 7,844 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 7,844 |
Exploration costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Consumables and drilling |  | – |  |  | – |  |  | 1,170 |  |  | – |  |  | 36 |  |  | – |  |  | – |  |  | – |  |  | 1,206 |
- Contractor |  | – |  |  | – |  |  | – |  |  | 4 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 4 |
- Labour |  | – |  |  | – |  |  | 260 |  |  | – |  |  | 37 |  |  | – |  |  | 11 |  |  | – |  |  | 308 |
- Power |  | – |  |  | – |  |  | – |  |  | – |  |  | 32 |  |  | 4 |  |  | – |  |  | – |  |  | 36 |
Impairment * |  | – |  |  | – |  |  | – |  |  | (467 | ) |  | – |  |  | – |  |  | – |  |  | – |  |  | (467 | )
Balance at December 31, 2022 |  | – |  |  | 7,844 |  |  | 5,626 |  |  | – |  |  | 3,723 |  |  | 294 |  |  | 27 |  |  | 65 |  |  | 17,579 |
Balance at January 1, 2023 |  | – |  |  | 7,844 |  |  | 5,626 |  |  | – |  |  | 3,723 |  |  | 294 |  |  | 27 |  |  | 65 |  |  | 17,579 |
Acquisition costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Bilboes Gold |  | 73,198 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 73,198 |
Decommissioning asset estimation adjustment |  | – |  |  | 1,466 |  |  | 152 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 1,618 |
Exploration costs: |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  |  |
- Consumables and drilling |  | – |  |  | 903 |  |  | 102 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 1,005 |
- Contractor |  | – |  |  | 2 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 2 |
- Labour |  | – |  |  | 377 |  |  | 111 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 488 |
- Power |  | – |  |  | – |  |  | 7 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 7 |
- Other |  | 375 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 375 |
Balance at December 31, 2023 |  | 73,573 |  |  | 10,592 |  |  | 5,998 |  |  | – |  |  | 3,723 |  |  | 294 |  |  | 27 |  |  | 65 |  |  | 94,272 |

* | Caledonia completed sufficient work to establish that the potential orebody at the Connemara North property would not meet Caledonia’s requirements in terms of size, grade and width. Accordingly, Caledonia did not exercise the option to acquire the property. The costs have been impaired to $Nil.

Non cash acquisitions of exploration and evaluation assets consist of Bilboes acquisition ($73,198), decommissioning ($1,618) and Bilboes lease right use of asset ($40).

F- 46

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

17 | Exploration and evaluation assets (continued)

(a) | Bilboes Gold

Refer to note 5 for more information on the acquisition of the Bilboes Gold sulphide exploration and evaluation project.

(b) | Motapa

On November 1, 2022 Caledonia entered into a share purchase agreement with Bulawayo Mining Company Limited (“Bulawayo Mining”) to acquire all the shares of Motapa Mining Company UK Limited (“Motapa”), along with its wholly owned subsidiary Arraskar Investments (Private) Limited (“Arraskar”) (“Share Purchase Agreement”).

Caledonia considers Motapa to be highly prospective and strategically important to its growth ambitions in Zimbabwe in terms of both location and scale. Motapa is a large exploration property which is contiguous to the Bilboes gold project.

The Motapa asset has been mined throughout most of the second half of the 20th century, Caledonia understands that during this period the region produced as much as 300,000 ounces of gold. Whilst none of the mining infrastructure remains, the evidence of historical mining will provide guidance to our exploration team in best understanding the prospectivity of the region.

The acquisition was accounted for as an asset acquisition as the net assets acquired do not meet the definition of a business. The purchase price of the net assets acquired was allocated to exploration and evaluation assets based on management’s estimation of the fair value at acquisition.

The initial purchase price of $1 million was paid on November 1, 2022. Stamp duties of $41 were paid on November 9, 2022. There were no liabilities assumed with the acquisition of Motapa and Arraskar. The remainder of the purchase price was settled by way of loan notes (refer to note 30.1). The final settlement was made on July 3, 2023.

(c) | Maligreen

On November 3, 2021 the mining claims over the Maligreen project (“Maligreen”), a property situated in the Gweru mining district in the Zimbabwe Midlands, were transferred to Caledonia Holdings Zimbabwe (Private) Limited for a total cash consideration of US$4 million.

Maligreen is a substantial brownfield exploration opportunity with significant historical exploration and evaluation work having been conducted on the property over the last 30 years including:

● | An estimated 60,000 meters of diamond core and percussion drilling

● | 3.5 tonnes of bulk metallurgical test work

● | Aeromagnetic and ground geophysical surveys

The total land area of Maligreen is approximately 550 hectares comprising two historic open pit mining operations which produced approximately 20,000 oz of gold mined from oxides between 2000 and 2002 after which the operation was closed.

F- 47

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

17 | Exploration and evaluation assets (continued)

(c) | Maligreen (continued)

On November 7, 2022 the Company published an announcement and an updated technical report on SEDAR updating the estimated mineral resources at Maligreen. The report has an effective date of September 30, 2022 and estimates measured and indicated mineral resources of 8.03 million tonnes at a grade of 1.71g/t containing approximately 442,000 ounces of gold and inferred mineral resources of 6.17 million tonnes at a grade of 2.12g/t containing approximately 420,000 ounces of gold. The upgrade to the mineral resources at Maligreen improves the geological confidence of approximately half the mineral resources from inferred to measured and indicated mineral resources from the previous mineral resources statement.

F- 48

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

18 | Property, plant and equipment

Cost |  | Land and Buildings |  |  | Right of use assets |  |  | Mine development, infrastructure and other |  |  | Assets under construction and decommissioning assets |  |  | Plant and equipment |  |  | Furniture and fittings |  |  | Motor vehicles |  |  | Solar Plant& |  |  | Total |
Balance at January 1, 2022 |  | 14,435 |  |  | 543 |  |  | 73,914 |  |  | 35,476 |  |  | 64,319 |  |  | 1,342 |  |  | 3,169 |  |  | 1,940 |  |  | 195,138 |
Additions* |  | – |  |  | – |  |  | – |  |  | 31,711 |  |  | 3,049 |  |  | 243 |  |  | 147 |  |  | 12,198 |  |  | 47,348 |
Impairments@ |  | – |  |  | – |  |  | (8,518 | ) |  | – |  |  | (998 | ) |  | – |  |  | – |  |  | – |  |  | (9,516 | )
Reallocations between asset classes |  | 759 |  |  | – |  |  | 15,886 |  |  | (20,734 | ) |  | 4,089 |  |  | – |  |  | – |  |  | – |  |  | – |
Acquisition of Bilboes oxide assets (Tribute) (note 5) |  | – |  |  | – |  |  | 872 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 872 |
Foreign exchange movement |  | – |  |  | (18 | ) |  | – |  |  | – |  |  | 26 |  |  | (22 | ) |  | (2 | ) |  | – |  |  | (16 | )
Balance at December 31, 2022 |  | 15,194 |  |  | 525 |  |  | 82,154 |  |  | 46,453 |  |  | 70,485 |  |  | 1,563 |  |  | 3,314 |  |  | 14,138 |  |  | 233,826 |
Balance at January 1, 2023 |  | 15,194 |  |  | 525 |  |  | 82,154 |  |  | 46,453 |  |  | 70,485 |  |  | 1,563 |  |  | 3,314 |  |  | 14,138 |  |  | 233,826 |
Additions* |  | – |  |  | – |  |  | – |  |  | 28,276 |  |  | 538 |  |  | 335 |  |  | 294 |  |  | 163 |  |  | 29,606 |
Impairments~ |  | – |  |  | – |  |  | (872 | ) |  | – |  |  | (36 | ) |  | – |  |  | – |  |  | – |  |  | (908 | )
Disposals |  | – |  |  | – |  |  | – |  |  | – |  |  | (33 | ) |  | – |  |  | – |  |  | – |  |  | (33 | )
Reallocations between asset classes |  | 1,492 |  |  | – |  |  | 37,116 |  |  | (39,099 | ) |  | 491 |  |  | – |  |  | – |  |  | – |  |  | – |
Reallocate to assets held for sale |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | (14,301 | ) |  | (14,301 | )
Foreign exchange movement |  | – |  |  | (24 | ) |  | – |  |  | (2 | ) |  | – |  |  | (37 | ) |  | (3 | ) |  | – |  |  | (66 | )
Balance at December 31, 2023 |  | 16,686 |  |  | 501 |  |  | 118,398 |  |  | 35,628 |  |  | 71,445 |  |  | 1,861 |  |  | 3,605 |  |  | – |  |  | 248,124 |

* | Included in additions is the change in estimate for the decommissioning asset of $1,962 (2022: ($468))
@ | Included in the 2022 impairments are development asset costs of $8,518 that predominantly relates to prospective areas above 750 meters at Blanket which are not included in the LoMP. Also included in the 2022 impairments are generator cost of $791 and loader bottom decks at a cost of $101; these assets were no longer in working condition. The carrying amount for these impaired assets were impaired to $Nil.
& | The solar plant was fully commissioned on February 2, 2023 and the sale agreement between Caledonia Mining Corporation Plc and Caledonia Mining Services (Private) Limited was concluded for the sale of the solar plant. Depreciation on the solar plant commenced on February 2, 2023 and the power purchase agreement, between Caledonia Mining Services (Private) Limited and Blanket Mine, became effective. From September 28, 2023 the solar plant is classified as held for sale. In December 2022, the Caledonia board approved a proposal for Caledonia Mining Services (Private) Limited (which owns the solar plant) to issue loan notes pursuant to a loan note instrument (“bonds”) up to a value of $12 million. The decision was taken in order to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market. Refer to note 30.2 for more information on these loan notes.
~ | On June 27, 2023 the decision was taken to place the Bilboes oxide mine on care and maintenance as the cost related to removing the waste and accessing the orebody could exceed the benefit from the gold revenues to be received. The impairment loss that was recognised amounted to a carrying value of $851 on impairing the Bilboes oxide asset classified under mine development, infrastructure and other. Mining and metallurgical processing continued at the Bilboes oxide mine until the end of September 2023 when the contract miner's notice period came to an end. Leaching of material that has already been deposited on the leach pad will continue while the revenue from these activities contributes to the cost of the asset. Oxide mining and processing will resume when the stripping of the waste for the sulphide project commences and can be economically justified.

F- 49

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

18 | Property, plant and equipment (continued)

Accumulated depreciation and Impairment losses |  | Land and Buildings |  |  | Right of use assets |  |  | Mine development, infrastructure and other |  |  | Assets under construction and decommissioning assets |  |  | Plant and equipment |  |  | Furniture and fittings |  |  | Motor vehicles |  |  | Solar Plant |  |  | Total |
Balance at January 1, 2022 |  |  | 7,335 |  |  |  | 97 |  |  |  | 8,910 |  |  |  | 600 |  |  |  | 25,505 |  |  |  | 958 |  |  |  | 2,631 |  |  |  | – |  |  |  | 46,036 |
Depreciation for the year |  |  | 1,015 |  |  |  | 137 |  |  |  | 3,990 |  |  |  | 93 |  |  |  | 4,527 |  |  |  | 163 |  |  |  | 216 |  |  |  | – |  |  |  | 10,141 |
Accumulated depreciation - impairments |  |  | – |  |  |  | – |  |  |  | (532 | ) |  |  | – |  |  |  | (775 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (1,307 | )
Foreign exchange movement |  |  | – |  |  |  | (4 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (21 | ) |  |  | (2 | ) |  |  | – |  |  |  | (27 | )
Balance at December 31, 2022 |  |  | 8,350 |  |  |  | 230 |  |  |  | 12,368 |  |  |  | 693 |  |  |  | 29,257 |  |  |  | 1,100 |  |  |  | 2,845 |  |  |  | – |  |  |  | 54,843 |
Balance at January 1, 2023 |  |  | 8,350 |  |  |  | 230 |  |  |  | 12,368 |  |  |  | 693 |  |  |  | 29,257 |  |  |  | 1,100 |  |  |  | 2,845 |  |  |  | – |  |  |  | 54,843 |
Depreciation for the year |  |  | 1,012 |  |  |  | 124 |  |  |  | 5,459 |  |  |  | 93 |  |  |  | 6,573 |  |  |  | 185 |  |  |  | 258 |  |  |  | 782 |  |  |  | 14,486 |
Accumulated depreciation for assets reallocated to assets held for sale |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (782 | ) |  |  | (782 | )
Accumulated depreciation - impairments |  |  | – |  |  |  | – |  |  |  | (21 | ) |  |  | – |  |  |  | (10 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (31 | )
Foreign exchange movement |  |  | – |  |  |  | (9 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (30 | ) |  |  | (2 | ) |  |  | – |  |  |  | (41 | )
Balance at December 31, 2023 |  |  | 9,362 |  |  |  | 345 |  |  |  | 17,806 |  |  |  | 786 |  |  |  | 35,820 |  |  |  | 1,255 |  |  |  | 3,101 |  |  |  | – |  |  |  | 68,475 |
Carrying amounts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At December 31, 2022 |  |  | 6,844 |  |  |  | 295 |  |  |  | 69,786 |  |  |  | 45,760 |  |  |  | 41,228 |  |  |  | 463 |  |  |  | 469 |  |  |  | 14,138 |  |  |  | 178,983 |
At December 31, 2023 |  |  | 7,324 |  |  |  | 156 |  |  |  | 100,592 |  |  |  | 34,842 |  |  |  | 35,625 |  |  |  | 606 |  |  |  | 504 |  |  |  | – |  |  |  | 179,649 |

F- 50

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

18 | Property, plant and equipment (continued)

(a) | Impairment considerations

At year end management identified indicators of impairment at the Blanket CGU. The Blanket CGU excluded the Solar plant that is classified as held for sale at December 31, 2023. No impairment indicators were identified at other CGUs nor at a consolidated level, excluding the Blanket CGU. In calculating the recoverable amount, of the Blanket CGU, the recoverable amount significantly exceeded the carrying value. Management used the following assumptions as their best estimate:

● | Gold price per ounce ranging from $1,748 to $2,034.

● | Life of mine (“LoM”) to 2041 (that is inclusive of inferred resources and it based on an internal estimate representing management’s best estimate of the LoM inclusive of the latest drilling results).

● | grade ranging between 3.14g/t to 3.29g/t.

● | Production ounces between 77,822 and 81,446 per annum over the LoM.

● | On mine cost of between $892 to $1,427 (real) over the LoM.

● | Peak capex of $30.8 million.

● | Weighted average cost of capital of 15.4%.

● | Income tax of 25.75% on taxable income.

Items of property, plant and equipment are depreciated over the LoM, which includes planned production from inferred resources. These inferred resources are included in the calculation when the economic recovery thereof is demonstrated by the achieved recovered grade relative to the mine’s pay limit for the period 2006 to 2018. The pay limit is 2.10 g/t (2022: 2.10 g/t) while the recovered grade has ranged from 2.96 g/t to 3.24 g/t over the period. All-in-sustaining-cost has remained consistently below the gold price received over this period resulting in economic recovery of the inferred resources.

(b) | Change in estimate

In April 2023 management performed an operational efficiency review of its mining related equipment, which resulted in changes in the expected useful life of some of the assets included under mine, development, infrastructure and other and plant and equipment asset classes.

(i) | Mine, development, infrastructure and other

In August 2015 the Blanket Mine announced the construction of a new central shaft going down to 1,200m from surface, providing access for horizontal development in two directions on three levels below 750m. The aim was to increase production to annual levels of 75,000 to 80,000 ounces per year and extend the LoM. The Company commissioned the central shaft in the first quarter of 2021.This shaft is used for hoisting ore and people. Prior to commissioning of the central shaft, men were hoisted through the existing Jethro shaft which was constructed around 2009. With the commissioning of the central shaft, there will be a gradual decrease in the usage of the Jethro shaft for hoisting until decommissioning. The Jethro shaft is expected to be decommissioned in March 2025. Future economic benefits are expected to flow to the entity until the shaft is decommissioned.

The Company estimates Blanket will produce 160,000 ounces until the Jethro shaft is decommissioned, previously estimated over the LoM.

F- 51

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

18 | Property, plant and equipment (continued)

(b) | Change in estimate

(ii) | Plant and equipment

In carrying out a comprehensive asset’s useful life assessment, the following factors were considered in determining the useful life of an asset:

| ● | expected physical wear and tear, which depends on operational factors such as the number of shifts for which the asset is to be used, the current repair and maintenance programme, and the care and maintenance of the asset while idle; and

| ● | the expected usage of the asset.

An analysis of the various asset categories for which exceptions were identified during the assessment process are generators, load haul dump machines (“LHDs”), dump trucks, rock breakers and drill rigs. Previously estimated with a ten-year useful life, this plant and equipment is now estimated to have a useful life of five years from April 1, 2023.

Notwithstanding any future addition to the above-mentioned assets, the effect of the change in useful life on actual and expected depreciation expense, effective for the year ended December 31, 2023, is as follows:

Increase in depreciation expense from April 1, 2023 to December 31, 2023 |
Mine, development, infrastructure and other |  |  | 856 |
Plant and equipment |  |  | 1,302 |
|  |  | 2,158 |

The above results are a change in estimates and applied prospectively from April 1, 2023.

(c) | Non-cash items excluded from acquisition of property, plant and equipment:

|  | 2023 |  |  | 2022 |
Net property, plant and equipment included in prepayments |  |  | 329 |  |  |  | (4,445 | )
Net property, plant and equipment included in trade and other payables |  |  | 583 |  |  |  | (1,876 | )
Bilboes oxide project payable (note 29) |  |  | – |  |  |  | (872 | )
Change in estimate for decommissioning asset - adjustment capitalised in property, plant and equipment (note 18) |  |  | (1,962 | ) |  |  | 468 |
|  |  | (1,050 | ) |  |  | (6,725 | )

(d) | Capital commitments

The amount of contractual commitment for the acquisition of property, plant and equipment at December 31, 2023 amounted to $2,035 (2022: $4,066).

F- 52

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

19 | Leases

Leases as lessee

The Group leases administrative offices. The leases, which the Group normally enters into, typically run for a period of 3 to 6 years, with an option to renew the lease after that date. Three leases for the administrative offices expire in 2024 and one lease in 2025.

Information about leases for which the Group is a lessee is presented below.

i) | Amounts recognised in the statement of financial position

Right of use assets

Right of use assets related to leased properties are presented as part of property, plant and equipment (refer to note 18).

|  | 2023 |  |  | 2022 |
Balance at January 1 |  |  | 295 |  |  |  | 446 |
Depreciation |  |  | (124 | ) |  |  | (137 | )
Foreign currency movement |  |  | (15 | ) |  |  | (14 | )
Balance at December 31 |  |  | 156 |  |  |  | 295 |

Lease liabilities

|  | 2023 |  |  | 2022 |
Balance at January 1 |  |  | 313 |  |  |  | 465 |
Additions to lease liability |  |  | 67 |  |  |  | - |
Finance cost |  |  | 22 |  |  |  | 31 |
Lease payments |  |  | (184 | ) |  |  | (150 | )
Foreign currency movement |  |  | (10 | ) |  |  | (33 | )
Balance at December 31 |  |  | 208 |  |  |  | 313 |

ii) | Amounts recognised in profit or loss

|  | 2023 |  |  | 2022 |  |  | 2021 |
Finance cost on lease liabilities (note 15) |  |  | 22 |  |  |  | 31 |  |  |  | 24 |
Unrealised foreign exchange gain |  |  | (5 | ) |  |  | 19 |  |  |  | 1 |
Depreciation (note 18) |  |  | 124 |  |  |  | 137 |  |  |  | 115 |
|  |  | 141 |  |  |  | 187 |  |  |  | 140 |

iii) | Amounts recognised in statement of cash flows

|  | 2023 |  |  | 2022 |  |  | 2021 |
Total cash outflow for leases - principal |  |  | 162 |  |  |  | 119 |  |  |  | 105 |
Total cash outflow for leases - finance cost |  |  | 22 |  |  |  | 31 |  |  |  | 24 |
Total cash outflow for leases - payments |  |  | 184 |  |  |  | 150 |  |  |  | 129 |

F- 53

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

19 | Leases (continued)

iv) | Maturity of lease liabilities

The maturity of lease liabilities are as follows as at December 31:

|  | 2023 |  |  | 2022 |
Less than one year |  |  | 175 |  |  |  | 152 |
One to two years |  |  | 42 |  |  |  | 150 |
Two to three years |  |  | – |  |  |  | 40 |
Total lease payments |  |  | 217 |  |  |  | 342 |
Finance cost |  |  | (9 | ) |  |  | (29 | )
Present value of lease liabilities |  |  | 208 |  |  |  | 313 |

20 | Inventories

|  | 2023 |  |  | 2022 |
Consumable stores* |  |  | 18,001 |  |  |  | 17,645 |
Gold in progress @ |  |  | 2,303 |  |  |  | 689 |
|  |  | 20,304 |  |  |  | 18,334 |

* | Included in consumables stores is an amount of ($1,793) (2022: ($1,510)) for provision for obsolete stock for items that are not compatible with plant and equipment currently in use.
@ | Gold work in progress balance as at December 31, 2023 consists of 3,057 ounces (2022: 1,123 ounces).

21 | Trade and other receivables

|  | 2023 |  |  | 2022 |
Bullion sales receivable |  |  | 5,403 |  |  |  | 7,383 |
VAT receivables |  |  | 4,259 |  |  |  | 1,001 |
Solar - VAT and duty receivables* |  |  | – |  |  |  | 720 |
Deposits for stores, equipment and other receivables |  |  | 290 |  |  |  | 81 |
|  |  | 9,952 |  |  |  | 9,185 |

The carrying value of trade receivables is considered a reasonable approximation of fair value and are short term in nature. No provision for expected credit losses was recognised in the current or prior period as none of the debtors were past due and there has been no doubtful debt on debtors (refer to note 33). Up to the date of approval of these financial statements all of the outstanding bullion sales receivable were settled in full. The Company offset VAT receivables equating to $3.9 million against liabilities due for other types of taxes administrated by the Zimbabwe Revenue Authority.

* | On December 7, 2021 a duty rebate on the importation of capital goods was granted to the Company in terms of the Customs and Excise General Regulations of 2001. However, the customs officials at Forbes Border Post rejected a rebate on solar cables despite presentation of a valid rebate letter. An appeal was made to the Commissioner of Taxes seeking the rebate and the outcome of the appeal was unfavourable.

F- 54

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

22 | Prepayments

|  | 2023 |  |  | 2022 |
Caledonia Mining South Africa (Proprietary) Limited (“CMSA”) suppliers |  |  | 527 |  |  |  | 254 |
Blanket Mine third party suppliers |  |  | 1,746 |  |  |  | 1,494 |
Bilboes third party suppliers |  |  | – |  |  |  | 802 |
Solar prepayments |  |  | – |  |  |  | 104 |
Bilboes pre-effective date costs |  |  | – |  |  |  | 877 |
Other prepayments |  |  | 265 |  |  |  | 162 |
|  |  | 2,538 |  |  |  | 3,693 |

23 | Cash and cash equivalents

|  | 2023 |  |  | 2022 |
Bank balances |  |  | 4,252 |  |  |  | 4,737 |
Restricted cash * |  |  | 2,456 |  |  |  | 1,998 |
Cash and cash equivalents |  |  | 6,708 |  |  |  | 6,735 |
Bank overdrafts and short term loans used for cash management purposes @ |  |  | (17,740 | ) |  |  | (5,239 | )
Net cash and cash equivalents |  |  | (11,032 | ) |  |  | 1,496 |

* | Cash of $2,456 (denominated in RTGS$) held by Blanket Mine was earmarked by Stanbic Bank Zimbabwe as a letter of credit in favour of CMSA. The letter of credit was issued by Stanbic Bank Zimbabwe on November 28, 2023 and settled in January, 2024. The cash on maturity was transferred to CMSA’s bank account, denominated in South African Rands.
@ | Interest paid on bank overdraft was $1,657 (2022: $192).

| Date drawn | Expiry | Repayment term | Principal value | Balance drawn at December 31, 2023
Overdraft facilities and term loans |  |  |  |  |
Stanbic Bank - RTGS$ denomination | September 2023 | March 2024 | On demand | RTGS$350 million | $Nil
Stanbic Bank - USD denomination | September 2023 | March 2024 | On demand | $4 million | $3.8 million
Ecobank - USD denomination | November 2022 | December 2024 | On demand | $5 million | $5 million
Nedbank Zimbabwe - USD denomination | December 2022 | April 2024 | On demand | $3.5 million | $3.4 million
Nedbank Zimbabwe term loan - USD denomination | April 2023 | April 2024 | On demand | $3.5 million | $3.5 million
CABS – USD denomination | August 2023 | July 2024 | On demand | $2 million | $2 million

F- 55

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

24 | Assets and liabilities associated with assets held for sale

|  | 2023 |  |  | 2022 |
Non-current assets held for sale |  |  |  |  |  |  |  |
Solar plant |  |  | 13,519 |  |  |  | – |
Liabilities associated with assets held for sale |  |  |  |  |  |  |  |
Site restoration liability |  |  | 128 |  |  |  | – |

In the second quarter of 2023 management embarked on a marketing process to locate a buyer for the Company’s solar plant located next to Blanket Mine. Various offers were received and a counterparty with a non-binding offer was given exclusivity to further negotiate the sale of the plant after proving their ability to operate and fund solar plants of similar size and complexity. The offer was received from a reputable global renewable energy operator and management is in an advanced stage of executing agreements to sell the solar plant. It is proposed that the new owners will exclusively supply Blanket with electricity from the plant, on a take-or-pay basis and in doing so secure Blanket’s future power supply. This has the benefit of realising a cash profit on the sale of the plant and generate cash for reinvestment in our gold projects. In addition, management can focus on Caledonia’s core business of gold mining which yields higher returns to our shareholders.

On September 28, 2023 the Board approved management to negotiate the sale of the solar plant with the potential buyer. The assets were available for sale in their condition on September 28, 2023 and therefore met the criteria to be classified as held for sale.

Management determined the value at the carrying amount of $13,519 at September 28, 2023, as it was the lower of the fair value less cost to sell and the carrying amount. The proceeds of the disposal are expected to substantially exceed the carrying amount of the related net assets and accordingly no impairment losses have been recognised on the classification of the solar plant. The asset was classified as property, plant and equipment before the reclassification to assets held for sale.

25 | Share capital

Authorised

Unlimited number of ordinary shares of no par value.

Unlimited number of preference shares of no par value.

Issued ordinary shares

|  | Number of fully paid shares |  |  | Amount |
January 1, 2022 |  |  | 12,756,606 |  |  |  | 82,667 |
Shares issued: |  |  |  |  |  |  |  |
- share-based payment - employees (note 12.1(a)) |  |  | 76,520 |  |  |  | 804 |
December 31, 2022 |  |  | 12,833,126 |  |  |  | 83,471 |
Shares issued: |  |  |  |  |  |  |  |
- share-based payment - employees (note 12.1(a)) |  |  | 24,389 |  |  |  | 351 |
- equity raise* |  |  | 1,207,514 |  |  |  | 15,569 |
- Bilboes Gold Limited acquisition (note 5) |  |  | 5,123,044 |  |  |  | 65,677 |
December 31, 2023 |  |  | 19,188,073 |  |  |  | 165,068 |

* | Gross proceeds of $10,770 with a transaction cost of $846 were raised by issuing depository interests on the AIM of the London Stock Exchange Gross proceeds of $5,850 with a transaction cost of $205 were raised by issuing depository receipts on the VFEX. During quarter one of 2023, Mark Learmonth, Chief Executive Officer, and Toziyana Resources Limited, a company affiliated with Victor Gapare, executive Director of the Company, subscribed for 3,587 and 11,000 depositary interests respectively in the equity raise.

F- 56

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

26 | Reserves

Foreign currency translation reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations with functional currencies that differ from the presentation currency.

Share-based payment reserve

The share-based payment reserve comprises the fair value of equity instruments granted to employees, directors and service providers under share option plans (refer to note 12) and equity instruments issued to Blanket’s indigenous shareholders under Blanket Mine’s Indigenisation Transaction (refer note 6).

Contributed surplus

The contributed surplus reserve comprises the reduction in stated capital as approved by shareholders at the special general meeting on January 24, 2013 to be able to commence dividend payments.

Reserves

|  | 2023 |  |  | 2022 |
Foreign currency translation reserve |  |  | (10,409 | ) |  |  | (9,787 | )
Contributed surplus |  |  | 132,591 |  |  |  | 132,591 |
Equity-settled share-based payment reserve |  |  | 15,637 |  |  |  | 14,997 |
Total |  |  | 137,819 |  |  |  | 137,801 |

27 | Earnings per share

Weighted average number of shares – Basic earnings per share |  |  |  |  |  |  |  |  |
(in number of shares) |  | 2023 |  |  | 2022 |  |  | 2021 |
Issued shares at the beginning of year (note 25) |  |  | 12,833,126 |  |  |  | 12,756,606 |  |  |  | 12,118,823 |
Weighted average shares issued |  |  | 5,792,435 |  |  |  | 74,214 |  |  |  | 51,462 |
Weighted average number of shares at December 31 |  |  | 18,625,561 |  |  |  | 12,830,820 |  |  |  | 12,170,285 |
Weighted average number of shares - Diluted earnings per share |  |  |  |  |  |  |  |  |
(in number of shares) |  | 2023 |  |  | 2022 |  |  | 2021 |
Weighted average at December 31 |  |  | 18,625,561 |  |  |  | 12,830,820 |  |  |  | 12,170,285 |
Effect of dilutive options |  |  | 6,550 |  |  |  | 6,482 |  |  |  | 6,933 |
Weighted average number of shares (diluted) at December 31 |  |  | 18,632,111 |  |  |  | 12,837,302 |  |  |  | 12,177,218 |

The average market value of the Company’s shares for purposes of calculating the dilutive effect of share options was based on quoted market prices for the year during which the options were outstanding. Options of 13,450 (2022: 13,518, 2021: 18,842) were excluded from the dilutive earnings per share calculation as these options were anti-dilutive.

The quantity of options outstanding as at year end that were out of the money amounted to $Nil (2022: $Nil, 2021: $Nil) options.

F- 57

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

27 | Earnings per share (continued)

The calculation of total basic and diluted earnings per share for the year ended December 31, 2023 was calculated as follows:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Profit for the year attributable to owners of the Company (basic and diluted) |  |  | (4,198 | ) |  |  | 17,903 |  |  |  | 18,405 |
Blanket Mine Employee Trust Adjustment |  |  | (346 | ) |  |  | (517 | ) |  |  | (326 | )
Profit attributable to ordinary shareholders (basic and diluted) |  |  | (4,544 | ) |  |  | 17,386 |  |  |  | 18,079 |
Basic earnings per share - $ |  |  | (0.24 | ) |  |  | 1.36 |  |  |  | 1.49 |
Diluted earnings per share - $ |  |  | (0.24 | ) |  |  | 1.35 |  |  |  | 1.48 |

Basic earnings are adjusted for the amounts that accrue to other equity holders of subsidiaries upon the full distribution of post-acquisition earnings to shareholders.

Diluted earnings are calculated on the basis that the unpaid ownership interests of Blanket Mine’s indigenous shareholders are effectively treated as options whereby the weighted average fair value for the period of the Blanket Mine shares issued to the indigenous shareholders and which are subject to settlement of the loan accounts is compared to the balance of the loan accounts and any excess portion is regarded as dilutive. The difference between the number of Blanket Mine shares subject to the settlement of the loan accounts and the number of Blanket Mine shares that would have been issued at the average fair value, is treated as the issue of shares for no consideration and regarded as dilutive shares. The calculated dilution is taken into account with additional earnings attributable to the dilutive shares in Blanket Mine, if any. The interest of the NIEEF shareholding was anti-dilutive (i.e., the value of the options was less than the outstanding loan balance). Accordingly, there was no adjustment to fully diluted earnings attributable to shareholders.

F- 58

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

28 | Non-controlling interest

Blanket Mine’s (incorporated in Zimbabwe) NCI share is recognised at an effective share and voting rights of 13.2% (2022: 13.2%, 2021: 13.2%) based on summarised results as follows:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Current assets |  |  | 33,126 |  |  |  | 30,397 |  |  |  | 33,634 |
Non-current assets |  |  | 188,134 |  |  |  | 172,611 |  |  |  | 154,003 |
Current liabilities |  |  | (10,277 | ) |  |  | (9,583 | ) |  |  | (17,261 | )
Non-current liabilities |  |  | (10,901 | ) |  |  | (8,062 | ) |  |  | (11,535 | )
Net assets of Blanket Mine (100%) |  |  | 200,082 |  |  |  | 185,363 |  |  |  | 158,841 |
Carrying amount of NCI of 13.2% (2022: 13.2%, 2021: 13.2%) |  |  | 24,477 |  |  |  | 22,409 |  |  |  | 19,260 |
Revenue |  |  | 146,314 |  |  |  | 142,082 |  |  |  | 121,329 |
Profit after tax |  |  | 27,215 |  |  |  | 38,389 |  |  |  | 35,911 |
Total comprehensive income of Blanket Mine (100%) |  |  | 27,215 |  |  |  | 38,389 |  |  |  | 35,911 |
Profit allocated to NCI of 13.2% (2022: 13.2%, 2021: 13.2%) |  |  | 3,580 |  |  |  | 4,963 |  |  |  | 4,737 |
Dividend allocated to NCI of 13.2% (2022: 13.2%, 2021: 13.2%) |  |  | (1,512 | ) |  |  | (1,814 | ) |  |  | (2,001 | )
Net cash inflow from operating activities |  |  | 28,087 |  |  |  | 50,048 |  |  |  | 41,489 |
Net cash outflow from investing activities |  |  | (28,146 | ) |  |  | (37,798 | ) |  |  | (29,850 | )
Net cash outflow from financing activities |  |  | (5,017 | ) |  |  | (16,506 | ) |  |  | (12,817 | )
Net cash outflow |  |  | (5,076 | ) |  |  | (4,256 | ) |  |  | (1,178 | )

F- 59

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

29 | Provisions

Site restoration

Site restoration relates to the estimated cost of closing down the mines and projects and represent the site and environmental restoration costs, estimated to be paid as a result of mining activities or previous mining activities. For the Blanket Mine site restoration costs are capitalsed in property, plant and equipment with an increase in the provision at the net present value of the estimated future and inflated cost of site rehabilitation. Subsequently the capitalized cost are amortised over the life of the mine and the provision is unwound over the period to estimated restoration. For properties in the exploration and evaluation phase, such as the Bilboes, Maligreen and Motapa projects, site restoration costs are capitalised in exploration and evaluation assets with an increase in the provision at the undiscounted value of the estimated cost of site rehabilitation. Subsequently the costs capitalised are not amortised and the provision is not unwound.

Reconciliation of site restoration provision |  | 2023 |  |  | 2022 |
Blanket Mine |  |  |  |  |  |  |  |
Balance January 1 |  |  | 2,823 |  |  |  | 3,159 |
Unwinding of discount (note 17) |  |  | 109 |  |  |  | 132 |
Change in estimate (Blanket Mine) (note 18) |  |  | 1,834 |  |  |  | (468 | )
Balance December 31 |  |  | 4,766 |  |  |  | 2,823 |
Motapa, Maligreen and Bilboes |  |  |  |  |  |  |  |
Balance January 1 |  |  | 135 |  |  |  | 135 |
Change in estimate (Motapa) (note 17) |  |  | 1,466 |  |  |  | – |
Change in estimate (Maligreen) (note 17) |  |  | 152 |  |  |  | – |
Acquisition - (Bilboes) (note 5) |  |  | 4,466 |  |  |  | – |
Balance December 31 |  |  | 6,219 |  |  |  | 135 |
Total balance December 31 |  |  | 10,985 |  |  |  | 2,958 |
Current |  |  | – |  |  |  | – |
Non-current |  |  | 10,985 |  |  |  | 2,958 |
|  |  | 10,985 |  |  |  | 2,958 |

The discount rate in calculating the present value of the Blanket Mine provision is 4.14% (2022: 4.14%) and is based on a risk-free rate and cash flows are estimated at an average 2.40% inflation (2022: 2.40%). The gross rehabilitation costs, before discounting, amounted to $5,629 (2022: $3,137) for Blanket Mine as at December 31, 2023.

The undiscounted gross rehabilitation costs for exploration and evaluation assets as at December 31, 2023, amounted to $4,466 (2022: $Nil) for Bilboes Holdings, $1,466 (2022: $Nil) for Motapa and $287 (2022: $135) for Maligreen.

F- 60

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

29 | Provisions (continued)

(a) | Change in estimate

Amounts recorded for restoration and rehabilitation provision require management to estimate the future costs the Group will incur to complete the reclamation and remediation work required to comply with applicable laws and regulations as well as taking into consideration the timing of the reclamation activities and estimated discount rate. Future changes to environmental laws and regulations could increase the extent of reclamation and remediation work required to be performed by the Group. Increases in future costs could materially impact the amounts charged to operations for reclamation and remediation. The provision represents management’s best estimate of the present value of the future reclamation and remediation costs.

(i) | Motapa and Maligreen

Management performed a revised rehabilitation liability cost estimate during the fourth quarter of 2023.

The revised provision estimate of Motapa and Maligreen were capitalised as exploration and evaluation assets. The effect of the change in estimation was as follows:

Increase in provision as at December 31, 2023 |  |  |  |
Motapa |  |  | 1,466 |
Maligreen |  |  | 152 |
|  |  | 1,618 |

30 | Loan note instruments

Loan note instruments - finance costs |  |  |  |  | 2023 |  |  | 2022 |
Motapa loan notes |  |  | 30.1 |  |  | 619 |  |  |  | 302 |
Solar loan notes |  |  | 30.2 |  |  | 549 |  |  |  | – |
|  |  |  |  |  | 1,168 |  |  |  | 302 |

Loan note instruments - financial liabilities |  |  |  |  | 2023 |  |  | 2022 |
Motapa loan notes |  |  | 30.1 |  |  | – |  |  |  | 7,104 |
Solar loan notes |  |  | 30.2 |  |  | 7,112 |  |  |  | – |
|  |  |  |  |  | 7,112 |  |  |  | 7,104 |
Current |  |  |  |  |  | 665 |  |  |  | 7,104 |
Non-current |  |  |  |  |  | 6,447 |  |  |  | - |
|  |  |  |  |  | 7,112 |  |  |  | 7,104 |

F- 61

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

30 | Loan note instruments (continued)

30.1 | Motapa loan notes payable

On November 1, 2022 Caledonia, in connection with the Share Purchase Agreement, executed a loan note instrument to issue loan notes (“Loan note” or “Notes”) to Bulawayo Mining to acquire all the shares of Motapa Mining Company UK Limited (“Motapa”), along with its wholly owned subsidiary Arraskar Investments (Private) Limited (“Arraskar”). The shares were purchased with full title guarantee and free from all encumbrances, together with all rights attached or accruing to them. The Loan note certificates were issued by Caledonia on November 1, 2022.

The aggregate principal amount of the Loan notes were limited to US$7.25 million. Interest on the Loan notes was compounded monthly an interest rate of 13% per annum. Interest was payable on the principal amount of the Loan notes outstanding from time to time from the issue date of the Loan notes until the date of redemption of the Loan notes at the interest rate. $5 million of the loan notes was paid on March 31, 2023, and $2.25 million on June 30, 2023. $575 of the loan notes were paid on July 3, 2023 as agreed between Caledonia and each of the noteholders due to bank holidays in certain jurisdictions.

All Loan notes repaid by Caledonia were immediately cancelled and were not reissued.

The fair value of the Loan notes payable at inception was estimated to be $6,802 using the market approach method. The effective interest rate on the Loan notes was estimated to be 12.75% per annum. The Loan notes were subsequently measured at amortised cost.

A summary of the Loan notes payable was as follows:

|  | 2023 |  |  | 2022 |
Balance January 1 |  |  | 7,104 |  |  |  | - |
Fair value November 1, 2022 |  |  | – |  |  |  | 6,802 |
Finance cost accrued |  |  | 619 |  |  |  | 302 |
Repayment - principal |  |  | (7,250 | ) |  |  | - |
Repayment – finance cost paid |  |  | (473 | ) |  |  | - |
Balance December 31 |  |  | - |  |  |  | 7,104 |
Current |  |  | - |  |  |  | 7,104 |
Non-current |  |  | - |  |  |  | - |
|  |  | - |  |  |  | 7,104 |

Refer to note 17 for more information on the exploration and evaluation asset acquired.

F- 62

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

30 | Loan note instruments (continued)

30.2 | Solar loan notes

Following the commissioning of Caledonia’s wholly owned solar plant on February 2, 2023, the decision was taken to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market by way of issuing loan notes pursuant to a loan note instrument (“bonds”). The bonds were issued by the Zimbabwean registered entity owning the solar plant, Caledonia Mining Services (Private) Limited. The bonds carry a fixed interest rate of 9.5% payable bi-annually and have a tenure of 3 years from the date of issue. The bond repayments are guaranteed by the Company. $7 million of bonds were in issue at the date of approval of these financial statements. All bonds were issued to Zimbabwean registered commercial entities.

A summary of the bonds is as follows:

|  | 2023 |  |  | 2022 |
Balance January 1 |  |  | – |  |  |  | – |
Amounts received |  |  | 7,000 |  |  |  | – |
Transaction costs |  |  | (105 | ) |  |  | – |
Finance cost accrued |  |  | 549 |  |  |  | – |
Repayment - finance cost paid |  |  | (332 | ) |  |  | – |
Balance December 31 |  |  | 7,112 |  |  |  | – |
Current |  |  | 665 |  |  |  | – |
Non-current |  |  | 6,447 |  |  |  | – |
|  |  | 7,112 |  |  |  | – |

In April 2024, Caledonia Holdings Zimbabwe (Private) Limited, a wholly owned subsidiary of the Company, issued loan notes to the value of $2 million to Zimbabwean registered commercial entities. The bonds were issued to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market. The bonds have an interest rate of 9.5% payable bi-annually and have a tenor of 3 years from the date of issue. The bond repayments are guaranteed by the Company.

31 | Trade and other payables

|  | 2023 |  |  | 2022 |
Trade payables |  |  | 6,166 |  |  |  | 3,502 |
Electricity accrual |  |  | 2,676 |  |  |  | 2,386 |
Audit fee |  |  | 395 |  |  |  | 284 |
Dividends due |  |  | 1,048 |  |  |  | 1,883 |
Solar plant supplier accrual |  |  | – |  |  |  | 1,852 |
Bilboes oxide project payable |  |  | – |  |  |  | 872 |
Other payables |  |  | 692 |  |  |  | 651 |
Financial liabilities |  |  | 10,977 |  |  |  | 11,430 |
Production and management bonus accrual - Blanket Mine |  |  | 214 |  |  |  | 287 |
Other employee benefits - other |  |  | 2,229 |  |  |  | 982 |
Other employee benefits - settlements |  |  | 1,588 |  |  |  | – |
Leave pay |  |  | 2,655 |  |  |  | 2,462 |
Bonus provision |  |  | 190 |  |  |  | 1,025 |
Accruals |  |  | 2,650 |  |  |  | 1,268 |
Non-financial liabilities |  |  | 9,526 |  |  |  | 6,024 |
Total |  |  | 20,503 |  |  |  | 17,454 |

F- 63

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

32 | Cash flow information

Non-cash items and information presented separately on the statements of cash flows statement:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Operating profit |  |  | 15,177 |  |  |  | 40,276 |  |  |  | 38,360 |
Adjustments for: |  |  |  |  |  |  |  |  |  |  |  |
Impairment of property, plant and equipment (note 18) |  |  | 877 |  |  |  | 8,209 |  |  |  | 497 |
Impairment of exploration and evaluation assets (note 17) |  |  | – |  |  |  | 467 |  |  |  | 3,837 |
Impairment of solar plant - VAT and duty receivables |  |  | 720 |  |  |  | – |  |  |  | – |
Unrealised foreign exchange gains (note 13) |  |  | (4,217 | ) |  |  | (12,736 | ) |  |  | (2,754 | )
Cash-settled share-based expense (note 12.1) |  |  | 463 |  |  |  | 609 |  |  |  | 477 |
Cash-settled share-based expense included in production costs (note 12.1) |  |  | 660 |  |  |  | 853 |  |  |  | 692 |
Cash portion of cash-settled share-based expense |  |  | (1,695 | ) |  |  | (1,468 | ) |  |  | (420 | )
Equity-settled share-based expense (note 11.2) |  |  | 640 |  |  |  | 484 |  |  |  | – |
Depreciation (note 18) |  |  | 14,486 |  |  |  | 10,141 |  |  |  | 8,046 |
Fair value loss on derivative instruments (note 14) |  |  | 1,119 |  |  |  | 401 |  |  |  | 240 |
Profit on disposal of property, plant and equipment (note 18) |  |  | 33 |  |  |  | – |  |  |  | – |
Derecognition of property, plant and equipment |  |  | – |  |  |  | – |  |  |  | (38 | )
Write down of inventory |  |  | 283 |  |  |  | 563 |  |  |  | – |
Expected credit losses on deferred consideration on the disposal of subsidiary |  |  | – |  |  |  | – |  |  |  | 761 |
Cash generated from operations before working capital changes |  |  | 28,546 |  |  |  | 47,799 |  |  |  | 49,698 |
Inventories |  |  | (2,182 | ) |  |  | 1,915 |  |  |  | (4,016 | )
Prepayments |  |  | 338 |  |  |  | (1,375 | ) |  |  | (4,272 | )
Trade and other receivables |  |  | (1,910 | ) |  |  | (1,561 | ) |  |  | (4,746 | )
Trade and other payables |  |  | 1,606 |  |  |  | 2,879 |  |  |  | 2,039 |
Cash generated from operations |  |  | 26,398 |  |  |  | 49,657 |  |  |  | 38,703 |

F- 64

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

33 | Financial Instruments and risk management

The Group has exposure to the following risks from its use of financial instruments:

● | Credit risk;

● | Liquidity risk;

● | Market risk

This note present information about the Group’s exposure to each of the above risks and the Group’s objectives, policies and processes for measuring and managing risk. Further quantitative disclosures are included throughout these consolidated financial statements. The Group is exposed in varying degrees to a variety of financial instrument related risks by virtue of its activities. The overall financial risk management program focuses on the preservation of capital and protecting current and future Group assets and cash flows by reducing exposure to risks posed by the uncertainties and volatilities of financial markets.

The Board of Directors has the responsibility to ensure that an adequate financial risk management policy is established and to approve the policy. The Group’s Audit Committee oversees management’s compliance with the Group’s financial risk management policy.

Gold price hedges were entered into to manage the possible effect of gold price fluctuations. The derivative financial instrument was entered into by the Company for economic hedging purposes and not as a speculative investment. The fair value of the Group’s financial instruments approximates their carrying value due to the short period to maturity.

The types of risk exposure and the way in which such exposures are managed are described below:

(a) | Credit risk

Exposure to credit risk

Credit risk includes the risk of a financial loss to the Group if a gold sales customer fails to meet its contractual obligation.

The carrying amount of financial assets as disclosed in the statements of financial position and related notes represents the maximum credit exposure. The maximum exposure to credit risk for trade and other receivables at the reporting date by geographic region was:

Carrying amount |  | 2023 |  |  | 2022 |
Zimbabwe |  |  | 4,215 |  |  |  | 9,059 |
Jersey, Channel Islands |  |  | – |  |  |  | – |
Other regions |  |  | 1,618 |  |  |  | 1 |
|  |  | 5,833 |  |  |  | 9,060 |

Of the trade receivables balance at the end of the year, $3,110 (2022: $Nil) is due from AEG, the Group’s largest customer. Apart from this, the Group does not have significant credit risk exposure to any single counterparty. The Group’s credit risk over trade receivables is significantly reduced as Fidelity has never paid outside of their contractually agreed credit terms.

F- 65

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

33 | Financial Instruments and risk management (continued)

(b) | Liquidity risk

Liquidity risk is the risk that the Group does not have sufficient financial resources available to meet its obligations as they fall due. The Group manages its liquidity risk by ensuring sufficient cash availability to meet its likely cash requirements, after taking into account cash flows from operations and the Group’s holdings of cash and cash equivalents. The Group believes that these sources will be sufficient to cover the anticipated cash requirements. Senior management is also actively involved in the reviewing and approving of planned expenditures by regularly monitoring cash flows from operations and anticipated investing and financing activities.

The following are the contractual maturities of financial liabilities, including contractual interest payments.

Non-derivative financial liabilities

December 31, 2023 |  | Carrying amount |  |  | Total contractual cashflow amount |  |  | 12 months or less |
Trade and other payables |  |  | 10,977 |  |  |  | 10,977 |  |  |  | 10,977 |
Loan note payable |  |  | 7,112 |  |  |  | 8,663 |  |  |  | 665 |
Lease liabilities |  |  | 208 |  |  |  | 217 |  |  |  | 175 |
Overdraft and term loans |  |  | 17,740 |  |  |  | 17,740 |  |  |  | 17,740 |
|  |  | 36,037 |  |  |  | 37,597 |  |  |  | 29,557 |
December 31, 2022 |  | Carrying amount |  |  | Total contractual cashflow amount |  |  | 12 months or less |
Trade and other payables |  |  | 11,430 |  |  |  | 11,430 |  |  |  | 11,430 |
Loan note payable |  |  | 7,104 |  |  |  | 7,723 |  |  |  | 7,723 |
Lease liabilities |  |  | 313 |  |  |  | 342 |  |  |  | 152 |
Overdraft and term loans |  |  | 5,239 |  |  |  | 5,239 |  |  |  | 5,239 |
|  |  | 24,086 |  |  |  | 24,734 |  |  |  | 24,544 |

The Group regularly monitors its liquidity risk and evaluates the options available.

Sensitivity analysis

A reasonably possible strengthening (weakening) of the gold price will have an impact on the revenue of the Group and the fair value of the gold options at December 31, 2023. This would have affected the measurement of financial instruments by the amounts as indicated below. This analysis assumes that all other variables remain constant.

F- 66

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

33 | Financial Instruments and risk management (continued)

(b) | Liquidity risk (continued)

Sensitivity analysis (continued)

An increase or decrease of 5% of the gold price would have the following equal or opposite effect on the derivative financial instruments on December 31:

Consolidated statement of financial position:

|  | 2023 |  |  | 2022 |
Derivative financial assets - Put option |  |  |  |  |  |  |  |
Increase by 5% of the gold price |  |  | - |  |  |  | - |
Decrease by 5% of the gold price |  |  | 4 |  |  |  | 22 |

Consolidated statement of profit or loss and other comprehensive income:

Fair value loss on derivative financial instruments |  | 2023 |  |  | 2022 |
Derivative financial assets - Put option |  |  |  |  |  |  |  |
Increase by 5% of the gold price |  |  | - |  |  |  | - |
Decrease by 5% of the gold price |  |  | 4 |  |  |  | 22 |

The Group’s revenues had full exposure to the gold price up to December 19, 2023 when the gold put option agreement was concluded (refer note 14.1).

(c) | Market risk

(i) | Currency risk

The Group is exposed to currency risk on inter-company sales and purchases that are denominated in a currency other than the respective functional currencies of Group entities. The Group does not use financial instruments to hedge its exposure to currency risk. To reduce exposure to currency transaction risk, the Group regularly reviews the currency (i.e. RTGS$ or foreign currency) in which it spends its cash to identify and avoid specific expenditures in currencies that experience inflationary pressures. The Group aims to maintain cash and cash equivalents in US Dollars to manage foreign exchange exposure.

The fluctuation of the US Dollar in relation to other currencies that entities within the Group may transact in will consequently have an effect upon the profitability of the Group and may also effect the value of the Group’s assets and liabilities. As noted below, the Group has certain financial assets and liabilities denominated in currencies other than the functional currency of the Company. To reduce exposure to currency transaction risk, the Group regularly reviews the currency in which it spends its cash to identify and avoid specific expenditures in currencies that experience inflationary pressures. Further, the Group aims to maintain cash and cash equivalents in US Dollars to avoid foreign exchange exposure and to meet short‐term liquidity requirements.

F- 67

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

33 | Financial Instruments and risk management (continued)

(c) | Market risk (continued)

(i) | Currency risk (continued)

Sensitivity analysis

As a result of the Group’s monetary assets and liabilities denominated in foreign currencies which is different to the functional currency of the underlying entities, the profit or loss and equity in the underlying entities could be affected by movements between the functional currency and the foreign currency. The table below indicates consolidated monetary assets/(liabilities) in the Group that have a different functional currency and foreign currency.

|  | 2023 |  |  | 2022 |
|  | $'000 |  |  | $'000 |
|  | Functional currency |  |  | Functional currency |
|  | ZAR |  |  |  | $ |  |  | ZAR |  |  |  | $ |
Cash and cash equivalents |  |  | 62 |  |  |  | 4,706 |  |  |  | 62 |  |  |  | 3,443 |
USD denominated |  |  | 61 |  |  |  | - |  |  |  | 62 |  |  |  | - |
ZAR denominated |  |  | - |  |  |  | 989 |  |  |  | - |  |  |  | 631 |
RTGS$ denominated |  |  | - |  |  |  | 3,424 |  |  |  | - |  |  |  | 2,502 |
GBP denominated |  |  | 1 |  |  |  | 293 |  |  |  | - |  |  |  | 235 |
CAD denominated |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 75 |
Trade and other receivables - RTGS$ denominated |  |  | - |  |  |  | 3,118 |  |  |  | - |  |  |  | 2,607 |
Trade and other payables - RTGS$ denominated |  |  | - |  |  |  | (106 | ) |  |  | - |  |  |  | (130 | )
Overdraft and term loans - RTGS$ denominated |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 62 |  |  |  | 7,718 |  |  |  | 62 |  |  |  | 5,920 |

A reasonably possible strengthening or weakening of 5% of the various functional currencies against the foreign currencies would have the following equal or opposite effect on profit or loss and equity for the Group:

|  | 2023 |  |  | 2022 |
|  | $'000 |  |  | $'000 |
|  | Functional currency |  |  | Functional currency |
|  | ZAR |  |  |  | $ |  |  | ZAR |  |  |  | $ |
Cash and cash equivalents |  |  | 3 |  |  |  | 177 |  |  |  | 3 |  |  |  | 134 |
Trade and other receivables |  |  | - |  |  |  | 148 |  |  |  | - |  |  |  | 124 |
Trade and other payables |  |  | - |  |  |  | (5 | ) |  |  | - |  |  |  | (6 | )
Overdraft and term loans |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 3 |  |  |  | 320 |  |  |  | 3 |  |  |  | 252 |

(ii) | Interest rate risk

The Group's interest rate risk arises from loans and borrowings, overdraft facility, short term loans and cash held. The loans and borrowings, overdraft facility and cash held have variable interest rates. Variable rates expose the Group to cash flow interest rate risk. The Group has not entered into interest rate swap agreements and mitigates the interest rate risk by remaining in a positive consolidated net cash position.

F- 68

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

33 | Financial Instruments and risk management (continued)

(c) | Market risk (continued)

(ii) | Interest rate risk (continued)

The Group’s assets and liabilities exposed to interest rate fluctuations as at year end is summarised as follows:

|  | 2023 |  |  | 2022 |
Cash and cash equivalents |  |  | 6,708 |  |  |  | 6,735 |
Overdraft and term loans |  |  | (17,740 | ) |  |  | (5,239 | )
|  |  | (11,032 | ) |  |  | 1,496 |

Interest rate risk arising from borrowings is offset by interest from available cash and cash equivalents. The table below summarises the effect of a change in finance cost on the Group’s profit or loss and equity, had the rates charged differed.

Sensitivity analysis - Cash and cash equivalents |  | 2023 |  |  | 2022 |
Increase by 100 basis points |  |  | 67 |  |  |  | 67 |
Decrease by 100 basis points |  |  | (67 | ) |  |  | (67 | )
Sensitivity analysis - Overdraft |  |  |  |  |  |  |  |
Increase by 100 basis points |  |  | 177 |  |  |  | 52 |
Decrease by 100 basis points |  |  | (177 | ) |  |  | (52 | )

34 | Dividends

|  | 2023 |  |  | 2022 |  |  | 2021 |
Dividends declared to owners of the Company |  |  | 8,752 |  |  |  | 8,975 |  |  |  | 6,068 |
Dividends declared to NCI |  |  | 1,512 |  |  |  | 1,814 |  |  |  | 2,001 |
|  |  | 10,264 |  |  |  | 10,789 |  |  |  | 8,069 |

Dividends declared and paid to owners of the Company |  |  | 8,752 |  |  |  | 7,178 |  |  |  | 6,068 |
Dividends declared and paid to NCI |  |  | 550 |  |  |  | 1,728 |  |  |  | 2,001 |
Dividends declared and due to owners of the Company |  |  | - |  |  |  | 1,797 |  |  |  | - |
Dividends declared and due to NCI |  |  | 1,048 |  |  |  | 86 |  |  |  | - |
|  |  | 10,350 |  |  |  | 10,789 |  |  |  | 8,069 |

A dividend was declared and paid in January 2024.

F- 69

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

34 | Dividends (continued)

Quarterly dividend per share history:

Declaration date | cents per share |
January 14, 2021 | 11.0 |
April 15, 2021 | 12.0 |
July 15, 2021 | 13.0 |
October 14, 2021 | 14.0 |
January 13, 2022 | 14.0 |
April 18, 2022 | 14.0 |
July 14, 2022 | 14.0 |
October 13, 2022 | 14.0 |
December 30, 2022 | 14.0 |
April 3, 2023 | 14.0 |
June 29, 2023 | 14.0 |
September 28, 2023 | 14.0 |

35 | Contingencies

The Group may be subject to various claims that arise in the normal course of business. Management believes there are no contingent liabilities to report.

36 | Related parties

Directors of the company, as well as certain executives, are considered key management. For entities within the Group refer to note 37.

Employee contracts between CMSA, CHZ, the Company and key management include an option for respective key management to terminate such employee contracts in the event of a change in control of the Company and to receive a severance payment equal to six months’ to two years’ compensation. If this was triggered as at December 31, 2023 the severance payment would have amounted to $7,809 (2022: $8,575, 2021: $8,214). A change in control would constitute:

● | the acquisition of more than 50% of the shares; or

● | the acquisition of the right to exercise the majority of the voting rights of shares; or

● | the acquisition of the right to appoint the majority of the board of directors; or

● | the acquisition of more than 50% of the assets of the Group.

F- 70

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

36 | Related parties (continued)

Key management personnel and director transactions:

A number of related parties transacted with the Group in the reporting period. The aggregate value of transactions and outstanding balances relating to key management personnel and entities over which they have control or significant influence were as follows:

|  | 2023 |  |  | 2022 |  |  | 2021 |
Key management salaries |  |  | 3,102 |  |  |  | 2,076 |  |  |  | 2,234 |
Share-based awards* @ |  |  | 720 |  |  |  | 999 |  |  |  | 540 |
All other compensation & |  |  | 2,599 |  |  |  | 1,697 |  |  |  | 1,011 |
|  |  | 6,421 |  |  |  | 4,772 |  |  |  | 3,785 |

* | Amount inclusive of $104 (2022: $354, 2021: $123) classified as production costs.
@ | Employees, officers, directors, consultants and other service providers also participate in the OEICP (see note 12.1).
& | The Company entered into a consultancy agreement with SR Curtis, a director of the Company, effective July 1, 2022 until December 31, 2023 at a monthly fee of $44.1 from July 1, 2022 until December 31, 2022 and $12.5 from January 1, 2023 until December 31, 2023. During the period ended December 31, 2023, the Company recorded $150 (2022: $265, 2021: $Nil) in consultancy fees. The Company has extended Mr. Curtis’ consultancy agreement until December 31, 2025 at a monthly fee of $12.5. Mr. Curtis is retiring as a director from the next annual general meeting (planned for May 7, 2024).
| Included is an amount of $647 (2022: $1,378, 2021: $1,011) that relates to bonuses provided or paid for in 2023.
| Included is an amount of $1,588 (2022: $54 (leave payout), 2021: $Nil) that relates to provision of a severance package payable in 2024

$30 rent was paid to a company of which V. Gapare is a director and that supplied office accommodation in Harare, Zimbabwe.

Group entities are set out in note 37.

Refer to note 6 and note 28 for transactions with NCI.

Refer to note 38 for management fees between CMSA and Blanket Mine.

Refer to note 30 for details of the bonds and the Loan notes which were guaranteed by the Company and by Greenstone Management Services Holdings (UK) Limited respectively.

Refer to note 11 for director fees.

All related party transactions occurred at arm’s length.

F- 71

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

37 | Group entities

Intercompany balances with holding company

| Activity of the company | Functional currency | Country of incorporation | Legal shareholding | Intercompany balances with holding company
|  |  |  | 2023 | 2022 | 2023 | 2022
Caledonia Holdings Zimbabwe (Private) Limited | Services | $ | Zimbabwe | 100 | 100 | (6,179) | (6,683)
Caledonia Mining Services (Private) Limited | Solar power provider | $ | Zimbabwe | 100 | 100 | 10,559 | -
Fintona Investments Proprietary Limited | Dormant | ZAR | South Africa | 100 | 100 | 14,860 | 14,859
Caledonia Mining South Africa Proprietary Limited | Procurement and services | ZAR | South Africa | 100 | 100 | (8,700) | (5,329)
Greenstone Management Services Holdings Limited | Investment holding | $ | United Kingdom | 100 | 100 | (48,149) | (36,597)
Blanket Mine (1983) (Private) Limited (2) | Mining | $ | Zimbabwe | 64 | 64 | (217) | 561
Blanket Employee Trust Services (Private) Limited ("BETS") (1) | Employee trust | $ | Zimbabwe | - | - | - | -
Motapa Mining Company UK Limited | Investment holding | $ | United Kingdom | 100 | 100 | - | -
Arraskar Investments (Private) Limited | Exploration | $ | Zimbabwe | 100 | 100 | - | -
Bilboes Gold Limited | Investment holding | $ | Mauritius | 100 | - | - | -
Bilboes Holdings (Private) Limited | Gold project | $ | United Kingdom | 100 | - | 805 | -
Caledonia Mining FZCO | Procurement | $ | Dubai | 100 | - | 61 | -
Caledonia (Connemara) (Private) Limited | Dormant | $ | Zimbabwe | 100 | 100 | - | -
Caledonia (Maligreen) (Private) Limited | Dormant | $ | Zimbabwe | 100 | 100 | - | -
Caledonia (Bilboes & Motapa) (Private) Limited | Dormant | $ | Zimbabwe | 100 | - | - | -

(1) | BETS and the Community Trust are consolidated as structured entities.
(2) | Refer to note 6 for the effective shareholding. NCI has a 13.2% (2022: 13.2%, 2021: 13.2%) interest in cash flows of Blanket only.

F- 72

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

37 | Group entities (continued)

Intercompany transactions with holding company

|  | Loans advanced/ (repaid) |  |  | Interest received |  |  | Foreign exchange profits |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Caledonia Holdings Zimbabwe (Private) Limited |  | (4 | ) |  | (424 | ) |  | 508 |  |  | 536 |  |  | – |  |  | – |
Caledonia Mining Services (Private) Limited |  | 10,016 |  |  | – |  |  | 543 |  |  | – |  |  | – |  |  | – |
Fintona Investments Proprietary Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Caledonia Mining South Africa Proprietary Limited |  | (3,591 | ) |  | (4,293 | ) |  | (455 | ) |  | – |  |  | 675 |  |  | 370 |
Greenstone Management Services Holdings Limited |  | (9,103 | ) |  | (13,681 | ) |  | (2,449 | ) |  | – |  |  | – |  |  | – |
Blanket Mine (1983) (Private) Limited |  | (760 | ) |  | (509 | ) |  | (18 | ) |  | 40 |  |  | – |  |  | – |
Blanket Employee Trust Services (Private) Limited ("BETS") |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Motapa Mining Company UK Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Arraskar Investments (Private) Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Bilboes Gold Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Bilboes Holdings (Private) Limited |  | 805 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Caledonia Mining FZCO |  | 61 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Caledonia (Connemara) (Private) Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Caledonia (Maligreen) (Private) Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
Caledonia (Bilboes & Motapa) (Private) Limited |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |
|  | (2,576 | ) |  | (18,907 | ) |  | (1,871 | ) |  | 576 |  |  | 675 |  |  | 370 |

38 | Operating Segments

The Group's operating segments have been identified based on geographic areas. The strategic business units are managed separately because they require different technology and marketing strategies. For each of the strategic business units, the Group’s CEO reviews internal management reports on at least a quarterly basis. Blanket Mine, Bilboes oxide mine, exploration and evaluation assets (“E&E projects”) and South Africa describe the Group's reportable segments. The Blanket operating segment comprises Caledonia Holdings Zimbabwe (Private) Limited, Blanket Mine (1983) (Private) Limited, Blanket’s satellite projects and Caledonia Mining Services (Private) Limited (“CMS solar”). The Bilboes oxide mine segment comprises the oxide mining activities. The E&E projects segment includes the exploration and evaluation activities of the Bilboes sulphide project as well as the Motapa and Maligreen projects. The South African segment represents the sales made by Caledonia Mining South Africa Proprietary Limited to the Blanket Mine. The holding company (Caledonia Mining Corporation Plc) and Greenstone Management Services Holdings Limited (a UK company) are responsible for corporate administrative functions within the Group and contribute to the strategic decision making process of the CEO and are therefore included in the disclosure below and combined with corporate and other reconciling amounts that do not represent a separate segment. Information regarding the results of each reportable segment is included below.

F- 73

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

38 | Operating Segments (continued)

Performance is measured based on profit before income tax, as included in the internal management report that is reviewed by the Group's CEO. Segment profit or exploration and evaluation cost is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. The accounting policies of the reportable segments are the same as the Group’s accounting policies.

Information about reportable segments

For the twelve months ended December 31, 2023 |  | Blanket |  |  | South Africa |  |  | Bilboes oxide mine |  |  | E&E projects |  |  | Inter-group eliminations adjustments |  |  | Corporate and other reconciling amounts |  |  | Total |
Revenue |  |  | 140,615 |  |  |  | – |  |  |  | 5,699 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 146,314 |
Inter-segmental revenue |  |  | – |  |  |  | 17,623 |  |  |  | – |  |  |  | – |  |  |  | (17,623 | ) |  |  | – |  |  |  | – |
Royalty |  |  | (7,318 | ) |  |  | – |  |  |  | (319 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (7,637 | )
Production costs |  |  | (68,923 | ) |  |  | (16,788 | ) |  |  | (13,095 | ) |  |  | – |  |  |  | 16,097 |  |  |  | – |  |  |  | (82,709 | )
Depreciation |  |  | (15,385 | ) |  |  | (139 | ) |  |  | – |  |  |  | – |  |  |  | 1,079 |  |  |  | (41 | ) |  |  | (14,486 | )
Other income |  |  | 236 |  |  |  | 10 |  |  |  | 1 |  |  |  | – |  |  |  | (1,750 | ) |  |  | 1,766 |  |  |  | 263 |
Other expenses* |  |  | (4,353 | ) |  |  | – |  |  |  | (14 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (4,367 | )
Administrative expenses |  |  | (912 | ) |  |  | (4,301 | ) |  |  | (2,101 | ) |  |  | (8 | ) |  |  | 17 |  |  |  | (10,124 | ) |  |  | (17,429 | )
Management fee |  |  | (3,468 | ) |  |  | 3,471 |  |  |  | – |  |  |  | – |  |  |  | (3 | ) |  |  | – |  |  |  | – |
Cash-settled share-based expense |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 660 |  |  |  | (1,123 | ) |  |  | (463 | )
Equity-settled share-based expense |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (640 | ) |  |  | (640 | )
Net foreign exchange (loss) gain |  |  | (3,229 | ) |  |  | (144 | ) |  |  | 97 |  |  |  | – |  |  |  | (71 | ) |  |  | 797 |  |  |  | (2,550 | )
Fair value loss on derivative liabilities |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (1,119 | ) |  |  | (1,119 | )
Finance income |  |  | – |  |  |  | 39 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 39 |
Finance cost |  |  | (3,323 | ) |  |  | 448 |  |  |  | (189 | ) |  |  | (22 | ) |  |  | (2 | ) |  |  | 64 |  |  |  | (3,024 | )
Profit (loss) before tax |  |  | 33,940 |  |  |  | 219 |  |  |  | (9,921 | ) |  |  | (30 | ) |  |  | (1,596 | ) |  |  | (10,420 | ) |  |  | 12,192 |
Tax expense |  |  | (12,256 | ) |  |  | (235 | ) |  |  | – |  |  |  | – |  |  |  | (19 | ) |  |  | (300 | ) |  |  | (12,810 | )
Profit (loss) after tax |  |  | 21,684 |  |  |  | (16 | ) |  |  | (9,921 | ) |  |  | (30 | ) |  |  | (1,615 | ) |  |  | (10,720 | ) |  |  | (618 | )

* | Other expenses include impairment of plant and equipment of $26 for Blanket and $851 for the Bilboes oxide mine, as well as impairment of the solar VAT and duty receivable amounting to $720 for Blanket.

F- 74

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

38 | Operating Segments (continued)

As at December 31, 2023 |  | Blanket |  |  | South Africa |  |  | Bilboes oxide mine |  |  | E&E projects |  |  | Inter-group eliminations adjustments |  |  | Corporate and other reconciling amounts |  |  | Total |
Segment assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current (excluding intercompany, including assets held for sale) |  |  | 51,236 |  |  |  | 2,363 |  |  |  | – |  |  |  | 401 |  |  |  | (1,757 | ) |  |  | 1,986 |  |  |  | 54,229 |
Non-current (excluding intercompany) |  |  | 188,426 |  |  |  | 697 |  |  |  | – |  |  |  | 92,664 |  |  |  | (5,294 | ) |  |  | (2,419 | ) |  |  | 274,074 |
Assets held for sale (note 24) |  |  | 13,519 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 13,519 |
Expenditure on property, plant and equipment (note 18) |  |  | 43,496 |  |  |  | 120 |  |  |  | – |  |  |  | – |  |  |  | (2,570 | ) |  |  | (11,440 | ) |  |  | 29,606 |
Expenditure on evaluation and exploration assets (note 17) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 76,693 |  |  |  | – |  |  |  | – |  |  |  | 76,693 |
Intercompany balances |  |  | 44,452 |  |  |  | 16,844 |  |  |  | (214 | ) |  |  | – |  |  |  | (145,523 | ) |  |  | 84,441 |  |  |  | – |
Segment liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current (excluding intercompany) |  |  | (31,747 | ) |  |  | (4,421 | ) |  |  | – |  |  |  | (1,755 | ) |  |  | – |  |  |  | (2,210 | ) |  |  | (40,133 | )
Non-current (excluding intercompany) |  |  | (17,634 | ) |  |  | – |  |  |  | – |  |  |  | (5,932 | ) |  |  | 4 |  |  |  | (416 | ) |  |  | (23,978 | )
Intercompany balances |  |  | (24,412 | ) |  |  | (34,193 | ) |  |  | – |  |  |  | (5,691 | ) |  |  | 145,523 |  |  |  | (81,227 | ) |  |  | – |

For the twelve months ended December 31, 2022 |  | Blanket |  |  | South Africa |  |  | E&E projects |  |  | Inter-group eliminations adjustments |  |  | Corporate and other reconciling amounts |  |  | Total |
Revenue |  |  | 142,082 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 142,082 |
Inter-segmental revenue |  |  | – |  |  |  | 19,885 |  |  |  | – |  |  |  | (19,885 | ) |  |  | – |  |  |  | – |
Royalty |  |  | (7,124 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (7,124 | )
Production costs |  |  | (62,701 | ) |  |  | (18,883 | ) |  |  | – |  |  |  | 18,586 |  |  |  | – |  |  |  | (62,998 | )
Depreciation |  |  | (10,735 | ) |  |  | (153 | ) |  |  | – |  |  |  | 789 |  |  |  | (42 | ) |  |  | (10,141 | )
Other income |  |  | 48 |  |  |  | 12 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 60 |
Other expenses* |  |  | (11,289 | ) |  |  | (66 | ) |  |  | – |  |  |  | – |  |  |  | (427 | ) |  |  | (11,782 | )
Administrative expenses |  |  | (172 | ) |  |  | (3,047 | ) |  |  | – |  |  |  | – |  |  |  | (8,722 | ) |  |  | (11,941 | )
Management fee |  |  | (3,454 | ) |  |  | 3,454 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Cash-settled share-based expense |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 853 |  |  |  | (1,462 | ) |  |  | (609 | )
Equity-settled share-based expense |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (484 | ) |  |  | (484 | )
Net foreign exchange gain (loss) |  |  | 4,415 |  |  |  | (119 | ) |  |  | – |  |  |  | (291 | ) |  |  | 406 |  |  |  | 4,411 |
Fair value loss on derivative liabilities |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (1,198 | ) |  |  | (1,198 | )
Finance income |  |  | – |  |  |  | 17 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 17 |
Finance cost |  |  | (861 | ) |  |  | (25 | ) |  |  | – |  |  |  | – |  |  |  | 229 |  |  |  | (657 | )
Profit (loss) before tax |  |  | 50,209 |  |  |  | 1,075 |  |  |  | – |  |  |  | 52 |  |  |  | (11,700 | ) |  |  | 39,636 |
Tax expense |  |  | (15,785 | ) |  |  | (252 | ) |  |  | – |  |  |  | 117 |  |  |  | (850 | ) |  |  | (16,770 | )
Profit (loss) after tax |  |  | 34,424 |  |  |  | 823 |  |  |  | – |  |  |  | 169 |  |  |  | (12,550 | ) |  |  | 22,866 |

* | Other expenses include impairment of plant and equipment of $8,209 for Blanket, as well as impairment of the Connemara North of $720.

F- 75

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

38 | Operating Segments (continued)

As at December 31, 2022 |  | Zimbabwe |  |  | South Africa |  |  | E&E projects |  |  | Inter-group eliminations adjustments |  |  | Corporate and other reconciling amounts |  |  | Total |
Segment assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current (excluding intercompany) |  |  | 33,130 |  |  |  | 1,448 |  |  |  | – |  |  |  | (83 | ) |  |  | 3,932 |  |  |  | 38,427 |
Non-current (excluding intercompany) |  |  | 176,356 |  |  |  | 822 |  |  |  | 5,626 |  |  |  | (5,446 | ) |  |  | 19,406 |  |  |  | 196,764 |
Expenditure on property, plant and equipment (note 18) |  |  | 38,763 |  |  |  | (881 | ) |  |  | 872 |  |  |  | (1,355 | ) |  |  | 10,821 |  |  |  | 48,220 |
Expenditure on evaluation and exploration assets (note 17) |  |  | 7,964 |  |  |  | – |  |  |  | 1,430 |  |  |  | – |  |  |  | 4 |  |  |  | 9,398 |
Intercompany balances |  |  | 33,468 |  |  |  | 12,202 |  |  |  | – |  |  |  | (107,227 | ) |  |  | 61,557 |  |  |  | – |
Segment liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current (excluding intercompany) |  |  | (17,451 | ) |  |  | (1,901 | ) |  |  | – |  |  |  | – |  |  |  | (13,089 | ) |  |  | (32,441 | )
Non-current (excluding intercompany) |  |  | (8,197 | ) |  |  | (101 | ) |  |  | – |  |  |  | 116 |  |  |  | (1,109 | ) |  |  | (9,291 | )
Intercompany balances |  |  | (12,725 | ) |  |  | (34,753 | ) |  |  | – |  |  |  | 107,227 |  |  |  | (59,749 | ) |  |  | – |

Major customer

Revenues received from Fidelity amounted to $66,177 (2022: $142,082; 2021: $121,329) for the twelve months ended December 31, 2023.

The Group has made $80,137 (2022: $Nil, 2021: $Nil) of sales to AEG up to December 31, 2023, representing 41,117 ounces (2022: Nil ounces, 2021: Nil ounces). Management believes this new sales mechanism reduces the risk associated with selling and receiving payment from a single refining source in Zimbabwe. It also creates the opportunity to use more competitive offshore refiners and it may allow for the Company to raise debt funding secured against offshore gold sales.

The Bullion trade receivables outstanding have been paid in full, after the year end.

39 | Defined Contribution Plan

Under the terms of the Mining Industry Pension Fund (“Fund”) in Zimbabwe, eligible employees contribute a fixed percentage of their eligible earnings to the Fund. Blanket Mine makes a matching contribution plus an inflation levy as a fixed percentage of eligible earnings of these employees. The total contribution by Blanket Mine for the year ended December 31, 2023 was $1,290 (2022: $1,022, 2021: $898).

40 | Subsequent events

There were no significant subsequent events between December 31, 2023 and the date of issue of these financial statements other than included in the preceding notes to the consolidated financial statements.

F- 76

Caledonia Mining Corporation Plc
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023, 2022 and 2021
(in thousands of United States Dollars, unless indicated otherwise)

41 | Going concern

The directors have, at the time of approving these consolidated financial statements, a reasonable expectation that Caledonia 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 these consolidated financial statements.

F-77

SIGNATURE

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.

Date: May 15, 2024

| CALEDONIA MINING CORPORATION PLC
| By: | /s/ Chester Goodburn
|  | Chester Goodburn Chief Financial Officer

F-78