COMPANY REGISTRATION NUMBER: 05350512

ALTONA RARE EARTHS PLC

ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2024

Table of Contents

CORPORATE INFORMATION...................................................................................................................... 3

CHAIRMAN’S STATEMENT ......................................................................................................................... 4

CEO’S STATEMENT ..................................................................................................................................... 5

OPERATIONS REVIEW ................................................................................................................................ 7

GROUP STRATEGIC REPORT .................................................................................................................. 16

CORPORATE GOVERNANCE REPORT ................................................................................................... 22

DIRECTORS’ REPORT ............................................................................................................................... 37

STATEMENT OF DIRECTORS’ RESPONSIBILITIES ............................................................................... 39

REMUNERATION REPORT ....................................................................................................................... 41

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ALTONA RARE EARTHS PLC ............ 48

STATEMENT OF CONSOLIDATED PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ..... 55

STATEMENT OF CONSOLIDATED FINANCIAL POSITION ..................................................................... 56

PARENT COMPANY STATEMENT OF FINANCIAL POSITION ................................................................ 57

STATEMENT OF CONSOLIDATED CASH FLOWS .................................................................................. 58

PARENT COMPANY STATEMENT OF CASH FLOWS ............................................................................. 59

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ..................................................................... 60

PARENT COMPANY STATEMENT OF CHANGES IN EQUITY ................................................................ 61

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ............................................................... 62

CORPORATE INFORMATION

DIRECTORS Simon Charles - (Non-Executive Director)

Cédric Simonet - (Director - Chief Executive Officer)

Louise Adrian - (Director – Chief Financial Officer)

Kristoffer Andersson – (Non-Executive Director)

COMPANY SECRETARY

Orana Corporate LLP

REGISTERED OFFICE

Eccleston Yards

25 Eccleston Place

London

SW1W 9NF

INDEPENDENT AUDITOR

PKF Littlejohn LLP

15 Westferry Circus

London

E14 4HD

CORPORATE ADVISOR

Novum Securities Ltd

Floor, 7-10 Chandos Street,

London

W1G 9DQ

BANKERS

HSBC Bank Plc

39 Tottenham Court Road

London

W1T 2AR

LAWYERS

Mildwaters Consulting LLP

Walton House

25 Bilton Road, Rugby

Warwickshire

CV22 7AG

REGISTRARS

Share Registrars Limited

3 the Millennium Centre

Crosby way, Farnham

Surrey

GU9 7XX

CHAIRMAN’S STATEMENT

Our Company’s results for the year ended 30 June 2024 cover a period of further change,

development and progress for our Company, consistent with our strategy.

Having listed on the Official List in June 2023, we believe this step has improved our standing

in the eyes of potential partners and counterparties. It has enabled us to access the capital

markets more effectively.

We have undertaken fundraises to support the plan for Monte Muambe, and we have

welcomed new shareholders on to our register. Progress has occurred at Monte Muambe, with

our interest having increased to 51% and our formal application having been made for a 25

year mining concession for that project. The scoping study results were encouraging and

positive.

2023/2024 saw output for rare earths rise globally, demand for rare earth elements softened

due to the global economic downturn, and competition in production has brought further

pressure on producers. The equity markets have been difficult for junior miners, especially for

those of us still in the exploration phase. Nonetheless, we take a long term view, and believe

our strategy to create and to nurture a diversified portfolio of mineral assets in Africa to be the

right one.

During the period under review, we acquired a copper project in the Mufumbe district in

Zambia, and entered into an option to acquire a copper and silver exploration licence in

Botswana – the Sesana project. These acquisitions are consistent with our strategy, and we

continue to look for appropriate acquisition opportunities.

We face the future with determination to deliver on our strategy, with a focus on its

implementation, and with resolve to generate value for our shareholders. Your board is

cohesive, aligned, and single minded about delivering results. Our work continues.

Simon Charles

Chair

Altona Rare Earths Plc

CEO’S STATEMENT

The Financial Year 2024 was a year of significant value building for Altona.

The Company’s focused exploration approach at the Monte Muambe rare earths and fluorspar

project led to the production of a maiden JORC mineral resource estimate (“MRE”) and of a

positive scoping study barely 2 years after the acquisition of the project. With 13.6 million tons

at 2.42% TREO, out of which almost 60% is already in the Indicated category, this MRE forms

a solid base for further increase and for a future ore reserve statement. As a result of the

completion of this milestone, Altona’s ownership of this important rare earths resource

increased from 20% to 51%. The project is now at prefeasibility study level.

According to Adamas Intelligence

, the global consumption of NdBeB magnets rose by 13.3%

in 2023. This largely reflects the increasing permanent magnets demand for electric vehicles

drive trains, and wind turbines, driven by the green energy transition. The same analyst

forecasts the demand to grow at a compound annual growth rate (“CAGR”) of 8.7% from 2024

through 2040, whereas the supply is expected to grow at a CAGR of 5.1% over the same

period. This underpins strong long-term market fundamentals, pushed by both decarbonisation

and robotics applications, the latter being expected to become the largest global demand driver

for permanent magnets by 2040.

Rare earths prices, however, after a peak in 2021 and 2022, have failed to meet analysts’

previsions and fell to their current level (about USD 75 per kg for Neodymium-Praseodymium

alloy). Such prices have delayed or hindered the development and funding of many rare earths

projects.

Cognisant of these facts, in early 2024, the Company announced and started to implement an

expansion and diversification strategy in order to mitigate its exposure to rare earths only, and

to build a portfolio of critical raw materials projects which we hope will open opportunities for

early monetisation of these assets. The Board defined clear selection criteria covering a limited

number of commodities in tier 1 African jurisdictions and narrowing down on low acquisition

cost and low initial exploration cost opportunities.

The acquisition of the Kabompo South copper project in Zambia in March 2024 and the option

to acquire the Sesana copper-silver project in Botswana in April 2024, (this option being

exercised post year end in July 2024) marked the start of this strategy’s implementation.

The Sesana project, located in the heart of the emerging Kalahari Copper Belt (“KCB”), and in

a jurisdiction widely regarded as the most mining-friendly in Africa, is particularly exciting. The

Sesana licence covers a well identified geological feature, the D’Kar – Ngwako Pan formations

contact, which is known to host copper mineralisation in the KCB. It is located just about 25km

from MMG’s Khoemacau Zone 5 underground copper-silver mine, where production capacity

is currently being increased.

As part of the implementation of this strategy, Altona has also initiated a review of the fluorspar

production potential of Monte Muambe. This includes the possibility of rapidly putting the low-

tonnage / high-grade (50% to 70% CaF

) fluorspar veins located in the Western part of the

intrusion into production, thus generating much needed cash flow for the Company. I am

particularly excited by this opportunity to turn an existing asset into a profit centre in the short

term.

https://www.adamasintel.com/new-report-rare-earth-magnet-market-outlook-to-2040/

Fluorspar is a little-known but very important critical raw material. Fluorspar demand and prices

have been steadily increasing over recent years and are expected to increase further as green

energy transition applications such as the manufacturing of electric vehicles batteries require

significant amounts of fluorspar. High-grade fluorspar veins lend themselves to the production

of metallurgical grade fluorspar through simple extraction, comminution and gravity

concentration methods.

In the meantime, the Company will continue derisking the Monte Muambe rare earths project

in order to unlock the tremendous value it created through 3 years of investment in this project.

This will be done through focused spending on priority activities such as securing a 25 year

mining concession (which is expected to be granted before the end of this year) and on-going

metallurgical testing, as well as continuing to seek a strategic investor involved in the rare

earths supply chain.

Dr Cédric Simonet

CEO

Altona Rare Earths Plc

OPERATIONS REVIEW

Financial Year 2024 activities - Monte Muambe Rare Earths and Fluorspar project

Maiden JORC Mineral Resource Estimate

On 25 September 2023, Altona published Monte Muambe’s maiden JORC Mineral Resource

Estimate, reported in the table below using a 1.5% TREO cut-off.

Notes:

• Million tonnes are rounded to one decimal place. Grades are rounded to two decimal places

for % and whole numbers for ppm.

• The MRE has been reported in consideration of reasonable prospects for eventual economic

extraction (RPEEE) using a pit shell based on a 1.5% TREO cut-off, revenue of 24.65 USD/kg

TREO MREC and average total recovery to MREC of 48%.

• Mineral resources are reported as dry tonnes on an in-situ basis.

• Rare earth elements are inclusive of the TREO and not additional to it.

• “NdPr Oxide” is the sum of Nd2O3 and Pr6O11.

The MRE’s tonnage and grade compares favourably to Ore Reserve Statements of more

advanced carbonatite REE-projects in Monte Muambe’s peer group in Africa and in Australia.

The MRE covers two (Target 1 and Target 4) of 11 identified REE targets at Monte Muambe

and there is considerable scope to increase its size. As part of the Prefeasibility Study, the

Company intends to increase the tonnage and the level of confidence of the existing MRE

through:

• In-fill drilling at Target 1 and Target 4 (to take the MRE on these two mineralised bodies

to Measured and Indicated levels);

• Down-dip drilling at Target 1 and Target 4 (to increase the tonnage);

• A re-evaluation of the potential viability of Target 6, which has known high-grade

mineralisation at a depth of 30 to 50m below the surface;

• Resource drilling at Targets 3, 9 and 11 among others.

Scoping Study

On 18 October 2023, Altona published an updated CPR including a Scoping Study (the

“Study”) for the Monte Muambe project.

The Study was prepared by geology and mining consultancy firm Snowden-Optiro, to assess

the potential viability of an open pit mining and MREC production operation, to assess project

development options, and to give sufficient confidence to the Company to advance to the

Prefeasibility Study stage.

The Study is preliminary in nature and includes material assumptions outlined in the CPR,

including product price assumptions. Capex estimates qualify as Class 4 estimates as per the

Association for the Advancement of Cost Engineering (AACE) Recommended Practice 47R-

11. The accuracy of the opex and of the initial capex estimate is assessed at +35 % to −30 %.

The base case includes an indicative life of mine extraction and production schedule, which is

based on a Mineral Resource Estimate, 58% of which classified as Indicated and 42% as

Inferred.

The Study takes into consideration open-pit mining of Target 1 and Target 4, at a Life of Mine

(“LOM”) strip ratio of 1.6, over a period of 18 years. An anticipated 750,000 tonnes of ore per

annum will be extracted and processed through a beneficiation plant to produce a rare earths

concentrate. The beneficiation process will include crushing, milling and flotation. The

concentrate will then be processed through a hydrometallurgical plant to produce an average

of about 15,000 tonnes of MREC per annum. The hydrometallurgical process will involve a

weak acid gangue leach, followed by rare earths leaching and purification. The MREC product

will be packaged and transported via existing road infrastructure to the port of Beira, in

Mozambique, for export.

Schematic layout of the Monte Muambe project

Base Case Technical and Economic parameters are summarised in the table below:

Parameter Unit

alue

Ore processed Mt 13.5

MREC produced kt 270.7

Initial Capex M US$ 276.3

Sustaining Capex M US$ 63.0

Opex LoM M US$ 1,519

Opex per ton MREC US$/t 5,613

Target 1

Open pit

Target 4

Open pit

Plant

Tailings

Storage

Facility

Waste

Dump

Waste

Dump

Gross Revenue LoM M US$ 3,670

Net Revenue LoM M US$ 3,193

EBITDA LoM M US$ 1,674

Revenue per ton MREC US$/t 13,558

Payback from first MREC years 2.5

Post tax NPV 8 M US$ 283.3

Post tax NPV 10 M US$ 207.0

Post tax NPV 8 (Upside Scenario) M US$ 409.9

Post tax IRR % 25%

Operating margin % 42%

Using an NPV of US$283.3 million with an applied real discount rate of 8%, the Project is most

sensitive to revenue (price, recovery, grade and exchange rates), less sensitive to opex and

least sensitive to capex.

Project sensitivity analysis

The Scoping Study demonstrates the potential for Monte Muambe to become a viable mining

operation.

Considerable upside potential has been identified in the Scoping Study and will be developed

further in the Prefeasibility Study (“PFS”). This includes:

• Increase of the resource base, as well as of the LoM and/or ore extraction rate;

• Mining parameters optimisation;

• Processing and Metallurgy, both for the beneficiation and hydrometallurgical plants;

• Energy sources mix and logistics options;

• Evaluation of the possibility of doing further onsite, in-country or regional separation

and refining;

• Setting up Responsible Sourcing systems.

Completion of Phase 2 and holding increase to 51%

On 24 October, in accordance with the Farm-Out Agreement, the Company notified the

original shareholders of Monte Muambe Mining Lda of the successful completion of Phase 2

and of its intention to proceed to Phase 3. This triggered the transfer of an additional 31% of

Monte Muambe Mining Lda, which was completed on 5 December 2023 and received the

formal approval from the Minister on 14 December 2023.

On 14 December 2023, Monte Muambe Mining Lda applied for a Mining Concession over

the area of Prospecting Licence 7573L for a duration of 25 years. At the date of this report,

the application is in the final stages of its process and the Mining Concession is expected to

be granted shortly.

Phase 3 – Prefeasibility Study

During the 3

quarter of 2023, the Company carried out additional drilling (10 RC holes

totalling 790m) and trenching at Monte Muambe, with a view to define better the mineralised

envelope at Target 4, and to test Target 3.

Significant intercepts, based on on-site p-XRF assays, include:

Hole Target From (m) To (m) Length (m) TREO%

(1)

MM086 T4 25 67 42 1.570

MM102 T4 33 84.4 51.4 2.620

MM103 T4 Surface 80 80 1.897

MM105 T4 Surface 76 76 3.426

MM106 T4 Surface 28 28 1.590

MM107 T4 27 70 43 1.865

MM090 T4 44 77.5 33.5 1.675

MM110 T3 Surface 30 30 2.735

(1) Sum of La, Ce, Nd, Pr and Y from Altona’s pXRF assays, in oxide percent.

Other Prefeasibility Study activities carried out during the financial year include the thorough

mineralogical characterisation of a representative 100kg ore sample from Target 1, which

was sent to SGS Lakefields in Canada.

Financial Year 2024 activities – Other projects

In February 2024, the Company carried out a review of its strategy and announced its

intention to expand and diversify its portfolio of projects in Africa into other critical raw

materials. The Company started assessing potential new opportunities with a focus on

projects having a low entry-cost and a clear pathway to early results and to majority

ownership. During the financial year, the Company advanced on the acquisition of two

projects: the Kabompo South copper project in Zambia and the Sesana copper-silver project

in Botswana.

Kabompo South Copper project, Zambia

On 28 March 2024, the Company announced entering into an agreement with Sustineri

Group Ltd and with the beneficial owners of Phelps Dodge Mining (Zambia) Limited to acquire

the entire issued share capital of Phelps Dodge Mining (Zambia) Limited, the registered

holder of Large Scale Exploration Licence 21403-HQ-LEL ("the Kabompo South Licence"),

located in the Mufumbe District of Northwestern Province of Zambia.

The Kabompo South Licence has a surface area of approximately 616 km2 and is valid for

copper, cobalt, nickel, lead, zinc, gold and diamonds. The Licence is located 4 km west of

the Kamweji copper mine, and 60 km southwest of the Mufumbwe copper mine (22 million

tonnes at 1.6% Cu), along strike.

The Kabompo South Licence was previously held by copper giant Freeport McMoRan until

this company's strategic decision to exit Zambia in April 2020. The Kabompo South Licence

has seen prior grassroot exploration including 4,000 line kilometre of ground magnetometer

survey and a partial leach soil geochemistry survey over a 4 kilometre square grid. This work

highlighted the presence of a large copper gold silver anomaly in the Northeastern part of the

licence area, overlapping a possible demagnetised zone.

Sesana Copper-Silver project, Botswana

On 9 April 2024, the Company announced that it entered into a binding option agreement

(“BOA") with Ignate African Mining P/L, with respect to exploration for copper and silver on

Prospecting Licence PL2329/2023 (the "Sesana Licence"), located in the Northwest District

of Botswana. This option was exercised post year end and at the date of this document the

parties are in the process of finalising the final agreement.

The Sesana Licence is located in the heart of the highly prospective Kalahari Copper Belt

("KCB"), close to major copper-silver discoveries. The Project is located 25 km from the

producing Khoemacau underground copper-silver mine and situated in an active exploration

area of the KCB (Khoemacau, Galileo Resources, ARC Minerals). Recent airborne

geophysical data interpretation shows prospective geological structures for copper-silver

mineralisation passing through the Tenement. Botswana is considered one of the most

attractive mining investment jurisdictions in Africa, and indeed, in the world.

The Sesana Licence has a surface area of about 274 km2 and is valid until 31 March 2026,

after which it can be renewed twice for periods of up to 2 years each. It is valid for copper,

cobalt, gold, silver, lead, zinc, aluminium, chromium, iron, titanium and platinum group

metals.

Renowned Kalahari Copper Belt expert David Catterall was subsequently hired to guide and

advise the Company with respect to its exploration program for the Sesana Licence.

Post-Financial Year activities

Monte Muambe Rare Earths and Fluorspar

The Company’s post-financial year activities are focused on continuing to derisk the project,

through the grant of the Mining Concession, and through key metallurgical testing activities.

As at the date of this report, the process of the Mining Concession application is believed to be in

its final stage.

The representative ore sample sent to SGS Lakefields is currently undergoing metallurgical

testing, with a focus on flotation rougher tests. Initial test results, received in September 2024,

are highly encouraging and show a rare earth recovery of 69.3%, and a good selectivity between

rare earths and fluorspar.

On-going flotation metallurgical testing is expected to improve the characteristics of the rare

earths concentrate which will be produced on site and subsequently processed through a

hydrometallurgy plant, also on site, to produce Mixed Rare Earths Carbonate.

This is expected to lead to a significant reduction of the hydrometallurgy plant opex and capex,

and to an improvement of the financial results outlined in the scoping study.

In October 2024, the Company started a re-assessment of the potential of Monte Muambe for

fluorspar production. Disseminated fluorspar in rare earth ore from Target 1 and Target 4 is

considered as a potential by-product of future rare earths mining and is covered in the scope of

current metallurgical testing. In addition, low-tonnage high-grade hydrothermal fluorspar veins

located in the western part of the carbonatite intrusion may lend themselves to short-term

development into a producing mine.

Kabompo South Copper

A field visit was undertaken by the Company’s CEO and lead geologist Cedric Simonet in

September 2024. Subsequently, geophysical consultant Earthmaps Consulting was hired to carry

out the reprocessing and interpretation of legacy geophysical data to generate soil geochemistry

follow up for copper and possibly for diamonds.

Sesana Copper and Silver

On 29 July 2024 the Company announced that it notified Ignate African Mining P/L of the

exercise of the option over the Sesana Project. At the date of this document the parties are in

the process of finalising the final agreement.

Outlook

2024 has been an important year for Altona, which saw the completion of key milestones for

the Monte Muambe Rare Earths and Fluorspar project, including a maiden JORC MRE, a

scoping study, an application for a 25 year Mining Concession, and the increase of the

Company’s ownership of the project from 20% to 51%.

The Company also made a strategic decision to expand and diversify its portfolio of critical raw

materials projects in Africa, targeting opportunities which:

• Are located in tier 1 African mining jurisdictions

• Have a low acquisition cost and a clear path to majority ownership

• Have a low initial exploration cost and can be fast-tracked

• Will contribute to building a portfolio of assets widening monetization and early revenue

options

The acquisition of the Kabompo South copper project in Zambia and the Sesana copper-silver

project in Botswana were two important steps towards the implementation of this strategy.

Over the past year, green energy transition driven demand for rare earths has tremendously

increased. The supply chain remains largely dominated by China, but alternative supply chains

are steadily developing in Europe, America, Australia and Asia. Neodymium and

praseodymium prices, however, remain depressed, well below the peak levels of late 2021

and early 2022. In this situation, the Company is convinced that its diversification strategy is

sound and appropriate.

Over the next year, Altona will continue to build a balanced portfolio of assets in accordance

with the above strategy, through carefully selected acquisitions and targeted exploration. This

is expected to open up early monetisation opportunities, through disposal or through short-

term development of suitable assets.

The Company will continue to derisk Monte Muambe through investment in priority activities

including the completion of the Mining Concession process, an application for land rights, the

on-going metallurgical studies, as well as securing a strategic investor involved in the rare

earths mid-stream or down-stream value chain for the project.

The Company has also started to review the potential for fluorspar production at Monte

Muambe. Fluorspar is an important critical raw material which is used in many industrial

manufacturing processes, including for the production of electric vehicles batteries. Because

fluorspar has been used in many other application, its price is not subject to the sharp

variations that rare earths have experienced over the past years. Fluorspar is often associated

to rare earths in carbonatites. At Monte Muambe fluorspar occurs both in disseminated form

in the rare earths ore (on-going metallurgical testing is also aimed at recovering fluorspar as a

by-product of rare earths), but also in low-tonnage high-grade fluorspar veins.

The high-grade fluorspar veins will be the object of a conceptual study to assess the possible

short-term development of a fluorspar mining operation at Monte Muambe, thus opening up

the possibility for early cash flow from this asset.

The Company will also commence exploration activities at Kabompo South and Sesana, with

the aim of rapidly building the value of these two assets.

Dr Cédric Simonet

CEO

Altona Rare Earths Plc

CORPORATE REVIEW

Financial Review

Statement of Financial Position

During the financial year to 30 June 2024, the Company experienced growth in key areas,

reflecting strategic investments and capital expenditures. Investments increased from £1.6

million to £2.1 million, driven by an increase in ownership in the underlying asset, Monte

Muambe Mining Lda, from 20% to 51%, and additional capital contributions to fund the ongoing

development of this asset. Intangible assets also grew from £1.3 million to £1.6 million,

primarily due to continued expenditure on the mining asset, demonstrating the Company's

commitment to developing and enhancing its core operations. Trade receivables and payables

remained stable, while loans increased by £0.4 million, reflecting additional financing secured

during the year.

Equity saw a slight increase during the year, rising from £25.2 million to £25.4 million. Post

year end equity increased by a further £0.8 million to reflect the equity raise of £0.4 million, the

conversion of outstanding CLNs of £0.3m and the settlement of creditors through shares in

lieu of cash payment of £0.1 million.

Income Statement

The Company's income statement highlights a stable operating performance, with the

operating loss remaining steady at £1.1 million for both 2023 and 2024. However, finance costs

increased significantly from £0.2 million to £0.5 million, primarily due to the finance costs

associated with the increased debt taken on in the year and the warrants issued with respect

to this raising of finance. This increase in finance costs underscores the impact of the

Company's financing strategies on its overall financial performance. During the year the

Company renegotiated the outstanding CLNs which led to the conversion, post year end, of

£0.3 million debt into equity, improving the Company’s balance sheet and another £0.2 million

of CLNs being reprofiled as debt with a repayment date of 30 October 2025.

Liquidity and Cash Flow

The Company's liquidity position saw a reduction in cash reserves, decreasing from £1.1

million to £0.4 million by year end. This reduction was mainly due to the corporate costs of

being a public company and the ongoing capital expenditure on the mining asset at MMM. The

Company received a further £0.3 million in loans during the year and as mentioned above

renegotiated/reprofiled its existing CLNs. It also received subscription funds of £0.3 million for

equity that was issued post year end.

Despite this decrease in the cash position, the Company strengthened its liquidity position with

a new loan package of £0.9 million from two investors with a fixed interest rate of 12% and

repayment date of 30 October 2025. This money is being received in 8 tranches with £0.1

million received before year end.

This investment will allow the Company to enhance its asset base, manage its financial

obligations, and position itself for future growth while maintaining stability in its core operations

Board Changes

There were no Board changes during the financial year. However, post year end the Board

saw a significant revision with the resignation of Audrey Mothupi on the 1 August 2024 and

Martin Wood, the Chair on 10 August 2024.

The Company appointed Kristoffer Andersson on the 1 August 2024, as a Non-Executive

Director and we were pleased that Simon Charles was willing to step up to fill the Chair’s

position, effective from 10

August 2024.

Post Balance Sheet Events

On 19 July 2024, the Company announced the issue of 76,248,759 new ordinary shares as

follows.

• 39,400,000 Shares were issued to raise funds of £394,000

• 33,300,000 Shares were issued for the conversion of existing convertible loan notes of

£303,000; and

• 3,548,759 Shares were issued to certain Directors in lieu of fees and to various other

creditors.

On 29 July 2024, the Company announced it had exercised its option to acquire a 51% share

in the prospecting licence PL2329/2023, in Botswana from Ignate African Mineral (Pty) Ltd for

an initial consideration of USD$10,000 in cash and USD$50,000 in shares. The minimum

expenditure commitment is USD$100,000 for a 12 month period.

Louise Adrian

CFO

Altona Rare Earths Plc

GROUP STRATEGIC REPORT

The Directors present their strategic report on the Company and its subsidiary undertakings

(which together comprise the “Group”) for the year ended 30 June 2024.

Principal Activity

The Company’s principal activity is focused on the discovery and development of Critical Raw

Materials mining projects in Africa.

Review of Strategy and Business Model

The Company’s strategy is to identify, acquire, explore and develop Critical Raw Materials on

the Africa continent, with the aims of delivering value to its shareholders and to its countries

and communities of operations, and of supporting the development of Critical Raw Materials

supply chains critical to the Green Energy Transition. Delivering shareholders’ value may

involve, depending on the project, developing it into production, entering into strategic

partnerships to develop it, or selling it.

The Company has chosen Africa as its main geography of operation, due to its long mining

history which provides suitable regulatory frameworks, workable infrastructures and

experienced workforces. The Continent’s varied geology also created a favourable

environment for exploration, with different geological types of rare earths deposits being well

documented, including carbonatites, alkaline complexes, ionic adsorption clay deposits, and

hydrothermal veins. The Company also recognises the need, underpinned by recent policy

changes in Africa, to develop value addition and economic and social beneficiation locally, and

takes it into consideration in its mining projects.

The Company is currently developing Monte Muambe, its flagship Magnet Rare Earths Project,

located in Northwest Mozambique. The Project was acquired in June 2021, and the Company

has so far drilled over 7,800m, and defined a maiden JORC Mineral Resource Estimate of 13.6

million tons at 2.42% TREO. A Competent Person Report including the Scoping Study for

Monte Muambe was published on 18 October 2023. The Project is now at Prefeasibility Study

stage, with a focus on metallurgical testing and process. The Company’s holding in Monte

Muambe is currently 51% and is expected to grow to 70% by Q3 2025.

Altona is presently diversifying its portfolio by acquiring a limited number of critical raw material

projects to complement Monte Muambe. The acquisition of the Kabompo South copper project

in Zambia and of the Sesana copper-silver project in Botswana represents the first steps

towards the implementation of this expanded strategy.

Business Review

The developments during the year are detailed in the CEO Statement and the Operations

review on pages 5 to 13.

Financial Performance of the Group

The loss of the Group for the year ended 30 June 2024 before taxation amounts was £1.7m

(2023: loss of £1.3m).

The Board monitors the activities and performance of the Group on a regular basis. The Board

uses financial indicators based on budget versus actual to assess the performance of the

Group. The indicators set out below will continue to be used by the Board to assess

performance over the year to 30 June 2025.

The Group is committed to best practice in energy consumption, social, community and human

rights issues and these are discussed further in our ESG statement below. The three main

financial KPIs for the Group are as follows:

Key Performance Indicators

2024 2023

Cash and cash equivalents £392,000 £1,130,000

dministrative expenses as a percentage of total assets 38% 39%

Exploration costs capitalised during the yea

£250,000 £460,000

These allow the Group to monitor costs and plan future exploration and development activities.

Cash has been used to fund the Group’s operations and facilitate its investment activities (refer

to the Statement of Cash Flows on page 58).

Administrative expenses are the expenses related to the Group’s ability to run the corporate

functions to ensure they can perform their operational commitments.

Exploration costs capitalised during the year consist of exploration expenditure on the Group’s

exploration licences, net of foreign exchange rate movements and excludes any fair value uplift

of acquisitions.

Other standard industry key performance indicators that will only become relevant in the

coming years and therefore are not currently considered by the Directors are:

• Production of a Pre-Feasibility Study and a Bankable Feasibility Study (“BFS”)

• Adhering to strict ESG standards – as determined by the jurisdiction and nature of the

mining project

• Securing off-take partners ahead of commencement of mining

• Securing mine finance ahead of commencement of mining

Gender of Directors and Employees

The Board of Directors consists of one male and one female executive and two male non-

executive Directors.

Principal Risks and Uncertainties

The principal risks and uncertainties lie in the commercial viability of the continuing

development of the Monte Muambe Asset and whether this will add shareholder value, though

the recent publication of a JORC Mineral Resource Estimate and Scoping Study reduced the

Project’s level of risk. The Directors also consider the key risk for the Group to be the

maintenance of its reserves of cash and cash equivalents to meet this ongoing development

of assets.

The Group operates in an uncertain environment and is subject to a number of risk factors.

The Directors consider the following risk factors are of particular relevance to the Group’s

activities and to any investment in the Group. It should be noted that the list is not exhaustive

and that other risk factors not presently known or currently deemed immaterial may apply.

The risk factors are summarised in the table below:

Description

Impact Mitigation

Strategic risks

• Over reliance on the outcome of a single

asset and the continuing value of said

asset that may not result in a commercial

development and there is no certainty of

success. Successful acquisition of future

opportunities to build shareholder value,

the generation of future income streams

or net asset growth may not materialise.

• Competitors with significantly greater

financial and technical resources will be

able to outbid the Company on future

upstream opportunities.

• The Company is dependent on key

executives. The future success of the

Company depends partially on the

expertise of the CEO, as the Company’s

leading geologist. The loss of his services

could damage the Company’s business.

• Risk to strategic and business model due

to political instability, expropriation, and

government interference, especially when

operating in one country only.

High

• The Company is focused on acquiring

majority stakes in a number of mining

assets in different African countries

with regards to the exploration,

development and extraction of rare

earth metals.

• The Company also seeks to mitigate

the development risk through actively

diversifying its portfolio, which was

achieved post year end through the

acquisition of a copper licence in

Botswana.

• The Company has a strong

shareholder base, with 2 significant

shareholders supporting the company

through equity and debt.

• The CEO has a notice period of no

less than three months to ensure

efficient time to hand over

responsibilities in the event of a

departure. The Remuneration

Committee regularly evaluates

compensation and incentivisation

schemes to ensure that the

Company’s package is competitive.

The Company is looking to put a share

option plan in place to reward

executive directors for increasing

shareholder value.

• The Board analyses the risks and

rewards of a country before any

investment is made and also engages

with local partners who understand

the local political risk. The Company’s

recent expansion into Botswana and

Zambia, is seen as mitigating some

Country and Political risk as both

countries are viewed as stable for

minin

opportunities.

Financial risks

• Difficulty raising external funding for new

investment opportunities and exploration

activities in volatile capital markets. The

future availability of such financing is

uncertain.

• Cost escalation and budget overruns may

lead to faster use of cash resources than

originally planned.

• Risk of high inflation, transfer and

conversion of currency, which could

significantly increase exploration and

development costs and so affect valuation

of future acquisitions.

High

• Regular review of cashflow, working

capital and funding options are

performed by the Board to ensure the

Company remains a Going Concern.

• Build strong and sustainable

relationships with key shareholders.

Experienced advisers have been hired

to ensure the capital market is

accessible to the Company.

• Prudent approach to budgeting and

strong financial stewardship -

managing commitments and liquidity

to ensure the Group has sufficient

capital to meet spending

commitments.

• Establish local bank accounts and

negotiate contracts in US dollar value

where practicable.

• Enter negotiations with a Strategic

Investor to ensure reliability of funding

for the completion of the PFS at Monte

Muambe.

Environmental, social and governance risks

• ESG is key to the company’s legal and

social license to operate. Non-compliances,

or ESG-related social issues may prevent

the development or operation of the

Company’s Projects.

• ESG reporting is constantly evolving and is

a risk for the majority of exploration and

development companies. The Company

must seek to improve diversity, equity and

inclusion as well as be aware of the urgent

priorities to address climate change. All

stakeholders have increased expectations

of the Company’s ESG reporting and the

Company must meet these demands.

• Human resources and management are

critical to the success of the Company as it

develops its operations in Africa and lack of

quality personnel available could lead to

issues in completing projects in a timely and

cost efficient manner.

Medium

• ESG is part of the Company’s longer-

term, more strategic view and the

Board will consider ESG at each board

meeting and understand how their

decisions will meet the various

stakeholder demands.

• Policies and processes are being

further enhanced to ensure there is a

more rigorous reporting cycle in which

requirements are identified and met

before giving rise to any issues.

• The Company seeks to employ local

personnel where possible and has

joined with local educational

establishments to ensure training is of

a high level.

Legal and compliance risks

• Compliance with local laws and regulations.

• Difficulties in obtaining approvals and

licences in connection with new and existing

assets.

• Bribery and corruption.

• London Stock Exchange or the Financial

Conduct Authority Rule breaches

Medium

• The CEO has over 20 years’

experience working on mineral and

energy projects in Africa, including 10

in Mozambique.

• The Company also ensures local legal

advice is obtained when new assets

are to be purchased and these

professionals are retained to ensure

regular compliance is adhered to.

• The Company follows the 2018 QCA

code of corporate governance

(aspiring to adhere to the 2023

version) and this is set out in this

annual report and accounts. The

Company also has the various policies

in place which are overseen by the

Audit Committee and reviewed on a

regular basis:

o Anti Bribery and Corruption Policy

o Whistle Blowing Policy

o Anti Money Laundering Policy

• The board contains Directors with

professional qualifications in law and

accountin

. It is also able to consult

with outside advisers to ensure full

compliance.

The Directors regularly monitor these risks, using information obtained or developed from

external and internal sources and will take actions as appropriate to mitigate them. Effective

risk mitigation may be critical to the Company in achieving its strategic objectives and

protecting its assets, personnel and reputation. The Company assesses its risk on an ongoing

basis to ensure it identifies key business risks and takes measures to mitigate these. Other

steps include regular Board review of the business, monthly management reporting, financial

operating procedures and anti-bribery management systems. The Company reviews its

business risks and management systems on a regular basis.

Section 172(1) statement and stakeholder engagement

The Directors believe they have acted in the way most likely to promote the success of the

Company for the benefit of its members as a whole, as required by s172 of the Companies Act

2006. The specific requirements of s172 are set out below, along with the approach adopted

by the Directors to ensure they meet these requirements:

Consider the likely consequences of any decision on the long-term

The Company announced on 19 February 2024 that the time was right for the Company to

expand and diversify its portfolio of projects in Africa to include both rare earths and non-rare

earths critical raw materials. This updated corporate strategy has begun to take shape with

the announcement on 18 July 2024 of the acquisition of the Sesana copper licence in

Botswana. It is also in the process of actively assessing other potential new opportunities which

it believes will help to both strength and diversify its existing portfolio.

The Company has also announced that it is actively seeking a strategic investor to support the

ongoing work on the PFS at Monte Muambe which will continue to derisk this project and add

stability to the Group going forward.

Consider the interests of the Company’s employees

The Company currently has both permanent and temporary employees in Mozambique and

only Directors and Senior Management in the UK. It is committed to the fair and ethical

treatment of all of its staff and has implemented training programmes and direct relationships

with local educational establishments in Mozambique to ensure it creates a local workforce for

the future.

Foster the Company’s business relationships with suppliers, customers and others

In order to progress its projects in Mozambique and Botswana, the Company is reliant on the

support of its key suppliers (drilling contractors, suppliers of local equipment and materials and

security). It is therefore a key part of the Company’s strategy to develop these relationships

to ensure the Company maintains a strong and secure relationship with these suppliers.

Consider the impact of the Company’s operations on the community and the

environment

The Company is aware of the potential impact that its operations may have on the environment

and local community. It has been working closely with the community at Monte Muambe to

establish a borehole for a local water source and build stable communication infrastructure in

the area. It has also installed solar panels on site and will be engaging an environmental

consultant in the next stage of the project to ensure the impact of its operations are adequately

addressed and views are heard from the effected communities.

The Company is also preparing to undertake an Environmental Impact Assessment (EIA) for

the planned activities in Botswana. This assessment is aimed at ensuring that all operational

work is carried out with due consideration for the environment, local ecosystems, and the well-

being of surrounding communities. By proactively addressing potential environmental and

social impacts, the Company aims to minimise any adverse effects and promote sustainable

practices that align with both regulatory requirements and the Company’s corporate values.

Maintain a reputation for high standards of business conduct

The Company has established a number of policies and procedures that guide its operations

and corporate conduct. As the business continues to grow, these policies are regularly

reviewed and refined to ensure they remain aligned with the evolving regulatory environment

and the Company’s long-term strategic objectives. In addition, the Company is committed to

adhering to the Quoted Companies Alliance (QCA) Code on corporate governance. As

disclosed in the Corporate Governance Report included in this set of accounts, the Company

has also taken proactive steps to adopt the revised QCA Code ahead of the required timelines,

demonstrating its dedication to maintaining high standards of transparency and stakeholder

engagement.

Act fairly between members of the Company

The Directors and Senior Management hold 10% of the shares of the Company with the

remainder held by a range of individuals and companies. The Company extended the expiry

date of various warrants in the year to ensure all shareholders were treated equitably.

30 October 2024

Approved on behalf of the Board:

Dr Cédric Simonet

CEO, Altona Rare Earths Plc

CORPORATE GOVERNANCE REPORT

Principles of corporate governance

The Board of Directors recognises the importance of sound corporate governance and applies

The Quoted Company Alliance Corporate Governance Code (2018) (the ‘QCA Code’), which it

believes is the most appropriate recognised governance code for a Group, of its size, with a

listing on the London Stock Exchange.

The Board acknowledges the recent revision to the QCA Code, which introduces significant

enhancements aimed at promoting stronger governance practices among small and mid-sized

companies. As a Company committed to maintaining high standards of corporate governance,

we recognise the importance of these updates in ensuring transparency, accountability, and

long-term value creation for our shareholders and stakeholders.

While we have not yet fully implemented the new provisions of the revised QCA Code, we are

committed to reviewing and adopting these best practices over the coming year. Our goal is to

align our governance framework with the revised Code to the greatest extent possible, taking

into account our financial and personnel constraints as a small company. We believe that a

robust governance structure is crucial for our ongoing success and are dedicated to making

continuous improvements in this area as resources allow.

The revised Code continues to be based on 10 core principles and a set of supporting

disclosures. It sets out what the QCA considers to be appropriate arrangements for growing

companies and asks companies, by means of the prescribed disclosures, to explain how they

are meeting those principles. We have considered how we apply each principle and a full

description of our compliance with the QCA code is set out below and can also be found on our

website https://www.altonaRE.com

These revised principles are:

1. Establish a purpose, strategy and business model which promote long-term value for

shareholders;

2. Promote a corporate culture that is based on ethical values and behaviours;

3. Seek to understand and meet shareholder needs and expectations;

4. Take into account wider stakeholder interest, including social and environmental

responsibilities and their implications for long term success;

5. Embed effective risk management, internal controls and assurance activities, considering

both opportunities and threats, throughout the organisation;

6. Establish and maintain the board as a well-functioning, balanced team led by the chair;

7. Maintain appropriate governance structures and ensure that individually and collectively the

directors have the necessary up-to-date experience, skills and capabilities;

8. Evaluate board performance based on clear and relevant objectives, seeking continuous

improvement;

9. Establish a remuneration policy which is supportive of long-term value creation and the

company’s purpose, strategy and culture; and

10. Communicate how the Group is governed and is performing by maintaining a dialogue with

shareholders and other relevant stakeholders.

The Chairman has overall responsibility for implementing an appropriate governance framework

at the Group and the Board is committed to ensuring that this framework is adhered to. Below

follows a short explanation of how the Board will apply each of the principles, and how the key

updates are being considered:

Principle One

Purpose, Business Model and Strategy

The Company is driven by a clear purpose: to identify, acquire, explore, and develop Critical

Raw Materials (CRMs) across Africa in support of the global Green Energy Transition. The

Company's business model is centred on delivering long-term value to shareholders while

contributing to the economic and social development of the local communities and countries in

which it operates. This is achieved through the responsible and sustainable development of raw

material supply chains crucial for the future of renewable energy technologies.

The Company’s strategy is built on diversification to reduce exposure to fluctuating rare earth

element (REE) prices and to enhance its portfolio with other CRMs such as copper and fluorspar.

The Company's approach to project selection is guided by strict criteria, including resource

quality, low entry and exploration costs, and alignment with global demand for critical materials.

This strategy also aims to increase growth opportunities, create more frequent news flow, and

diversify jurisdictional risk.

The Company's flagship project, Monte Muambe, located in Northwest Mozambique,

exemplifies its integrated purpose, business model, and strategy. Acquired in 2021, Monte

Muambe is a magnet rare earth project with a defined JORC Mineral Resource Estimate of 13.6

million tons at 2.42% Total Rare Earth Oxides (TREO). Now at the prefeasibility study stage,

Monte Muambe underscores Altona’s focus on developing high-quality CRM assets that align

with its broader strategic goals.

In line with its diversification strategy, Altona is also expanding into complementary projects in

the copper sector, with the acquisition of the Kabompo South copper project in Zambia and the

Sesana copper-silver project in Botswana. These acquisitions represent the first steps in

executing the Company’s expanded strategy, reducing its reliance on rare earth prices and

increasing opportunities for sustainable growth and value creation.

Principle Two (previously eight)

Corporate Culture

The Board recognises and strives to promote a corporate culture based on strong ethical and

moral values. The revised Code now places a greater emphasis on a company’s purpose and

related ethical values and behaviours. The Group gives full and fair consideration to applications

for employment received regardless of age, gender, colour, ethnicity, disability, nationality,

religious beliefs, transgender status or sexual orientation. The Board takes account of

employees’ interests when making decisions, and suggestions from employees aimed at

improving the Group’s performance are welcomed.

Issues of bribery and corruption are taken seriously, The Group has a zero-tolerance approach

to bribery and corruption and has an anti-bribery and corruption policy in place to protect the

Group, its employees and those third parties to which the business engages with. The policy is

provided to staff upon joining the business and training is provided to ensure that all employees

within the business are aware of the importance of preventing bribery and corruption. Each

employment contract specifies that the employee will comply with the policies. There are strong

financial controls across the business to ensure ongoing monitoring and early detection.

Principle Three (previously two)

Understanding Shareholder Needs and Expectations

All shareholders are encouraged to attend the Company’s Annual General Meetings in person

where they can meet and directly communicate with the Board. After the close of business at

the Annual General Meeting, the Chairman, or one of the other Directors will open the floor to

questions from shareholders.

Shareholders are also welcome to contact the Company with any specific queries.

The Company also provides regulatory news through the Regulatory News Service (RNS). In

addition, other financial and business news updates are provided through various media

channels such as Twitter and UK online investor platforms. Shareholders also have access to

information through the Company’s website, www.altonaRE.com which is updated on a regular

basis. Contact details are also provided on the website.

The revised Code encourages proactive engagement with shareholders. The Company has

made regular use of the interactive interview platforms “Investor Meet Company” to allow this

higher level of interaction with shareholders.

Principle Four (previously three)

Considering wider stakeholder and social responsibilities

The Board takes regular account of the significance of social, environmental and ethical matters

affecting the business of the Group. The Group has a written policy on Corporate Social

Responsibility. The Board will seek to integrate this policy into its strategy to protect the interests

of the Group’s stakeholders through individual policies and through ethical and transparent

actions. The Company engages positively with regulatory authorities and stakeholders in its

project locations and encourages feedback through this engagement. Through this process the

Company identifies the key resources and fosters the relationships on which the business relies.

The revised Code places a much greater focus on ESG considerations, with the explicit

requirement for a more detailed qualitative and quantitative disclosures on ESG matters. The

Board is very aware of its ESG commitments and our approach to this is described in more detail

on pages 33 to 36.

Principle Five (previously four)

Risk Management

The Board regularly reviews the risks to which the Group is exposed and ensures through its

meetings and regular reporting that these risks are minimised as far as possible whilst

recognising that its business opportunities carry an inherently high level of risk. The principal

risks and uncertainties facing the Group at this stage in its development and in the foreseeable

future are detailed out in the Strategic Report together with risk mitigation strategies employed

by the Board.

The Board is committed to integrating environmental and social issues, including climate change

into their Risk management to ensure it meets the revised QCA Code requirements.

The Group does not currently have an internal audit function due to the small size of the Group

and limited resources available. The requirement for an internal audit function is kept under

review.

Principle Six (previously five)

A Well-Functioning Board

The Board’s role is to agree the Group’s long-term direction and strategy and monitor

achievement of its business objectives. The Board meets for these purposes as and when

required with a minimum of 12 meetings per year. The Board receives reports for consideration

on all significant strategic, operational and financial matters.

The Board is supported by the Audit, Remuneration and Compliance Committees, details of

which can be found in Principle 7 below.

The Board currently comprises of the Chief Executive (Cédric Simonet), the Chief Financial

Officer (Louise Adrian), and Non-Executive Directors (Kristoffer Andersson and Simon Charles),

who are based in South Africa and the UK respectively.

The Board considers one of the two Non-Executive Directors (NEDs) to be independent.

Kristoffer Andersson, is not considered independent due to his significant business relationship

with a major shareholder. However, the Board does not view this as a concern, as Kristoffer

remains fully aligned with the Company’s business model and strategy, with a strong focus on

creating shareholder value. Simon Charles holds a minor number of ordinary shares in the

Company, which the Board does not consider to affect his independence.

The revised QCA Code recommends that at least half of the Board consist of independent NEDs

and that key board committees aim to be fully independent. Currently, only one out of four

Directors on our Board is independent, and due to the small size of the Company, we do not

have sufficient personnel to fill key board committees with entirely independent members.

Additionally, implementing these recommendations would incur significant costs, which may not

be feasible for a company of our size at this stage. However, we recognise the importance of

independence and will consider expanding the number of independent Directors on the Board

and in key committees as the Company grows. As part of its annual performance evaluation

process, the Board, in conjunction with the Remuneration Committee, keeps its structure under

review in order to maintain an appropriate balance of executive and non-executive experience

and skills.

The revised Code also recommends that shareholders vote annually on the re-election of all

board members, the Company will not be resubmitting the entire Board each year. Our Articles

require one-third of the Board to be submitted for re-election annually, which is rounded up. With

four directors, this means half of the Board is already resubmitted each year. Resubmitting the

entire Board could cause unnecessary disruption, so while we acknowledge the new

recommendation, we will continue with our current approach.

Attendance at Board and Committee Meetings

The Board will report annually in the Directors’ Report on the number of Board and committee

meetings held during the year and the attendance record of individual Directors. Directors meet

formally and informally both in person and by telephone. To date there have been 12 formal

monthly meetings during the year ended 30 June 2024, and the volume and frequency of such

meetings is expected to continue at this rate.

A summary of attendance at Board meetings in the year to date is set out below:

Director Independent Board Audit Remuneration Compliance

Cédric Simonet NO 12 - - -

Louise Adrian NO 12 - - 1

Audrey Mothupi* YES 10 2 1 -

Simon Charles YES 12 2 1 1

Martin Wood** YES 12 1 1 1

*Resigned 1

August 2024

**Resigned 10

August 2024

Kristoffer Andersson was appointed 1

August 2024, after the year end reported above and so

is not included in this table.

Principle Seven (previously six and nine)

Maintenance of Governance Structures and Processes and Appropriate Skills and Experience

of the Directors

The Board has overall responsibility for all aspects of the business. The Non-Executive

Chairman is responsible for overseeing the running of the Board, ensuring that no individual or

group dominates the Board’s decision-making, and that the NEDs are properly briefed on all

operational and financial matters. The Chairman and CEO have overall responsibility for

corporate governance matters in the Group.

The CEO has the responsibility for implementing the strategy of the Board and managing the

day-to-day business activities of the Group. The Company Secretary is responsible for ensuring

that Board procedures are followed, and applicable rules and regulations are complied with. Key

operational and financial decisions are reserved for the Board on an ad hoc basis where

required. The two NEDs are responsible for bringing independent and objective judgment to

Board decisions. The Board has established Audit, Remuneration and Compliance Committees

with formally delegated duties and responsibilities. Due to the small size of the Company,

Nominations are dealt with by the Board as a whole.

Following the appointment of Simon Charles to Chair, Kristoffer Andersson has been appointed

as the Chair of all the Committees except the Compliance Committee. However, Simon has

remained a member of the other Committees in addition to his role as Chair. The Company has

made the decision that given the Company is small and faces both financial and personnel

constraints, this is the best use of the Company’s resources.

Audit Committee

Kristoffer Andersson is currently the chair of the Audit Committee and Simon Charles is also a

member of the committee. (Martin Wood and Audrey Mothupi were both members of this

Committee during the reporting period).

The Audit Committee will receive and review reports from management and from the Company

relating to the interim and annual accounts and to the system of internal financial control.

The Audit Committee is responsible for assisting the Board’s oversight of the integrity of the

financial statements and other financial reporting, the independence and performance of the

Company, the regulation and risk profile of the Group and the review and approval of any related

party transactions. The Audit Committee may hold private sessions with management and/or

without management present. Further, the Audit Committee is responsible for making

recommendations to the Board on the appointment of the Company’s auditors and the audit fee,

and reviews reports from management on the financial accounts and internal control systems

used throughout the Company and the Group.

The Audit Committee will meet at least two times a year and is responsible for ensuring that the

Group’s financial performance is properly monitored, controlled and reported. The Audit

Committee is responsible for the scope and effectiveness of the external audit and compliance

by the Group with statutory and other regulatory requirements. The Company Secretary will

prepare the minutes and circulate agendas for meetings. The auditors will be invited to meetings

when required, at least once annually ahead of the approval of the annual financial statements.

Remuneration Committee

Kristoffer Andersson is currently the chair of the Remuneration Committee and Simon Charles

is also a member of the committee. (Martin Wood and Audrey Mothupi were both members of

this Committee during the reporting period).

The Remuneration Committee is responsible for considering all material elements of

remuneration policy, the remuneration and incentivisation of Executive Directors and senior

management (as appropriate) and to make recommendations to the Board on the framework for

executive remuneration and its cost. The role of the Remuneration Committee is to keep under

review the Company’s remuneration policies to ensure that the Company attracts, retains and

motivates the most qualified talent who will contribute to the long-term success of the Company.

The Remuneration Committee also reviews the performance of the CEO and CFO and sets the

scale and structure of their remuneration, including the implementation of any bonus

arrangements, with due regard to the interests of shareholders.

The Remuneration Committee will also be responsible for the recommendations of the valuation

of any options granted under the Company’s Share Option Plan and, in particular, the price per

share and the application of the performance standards which may apply to any grant, ensuring

in determining such remuneration packages and arrangements, due regard is given to any

relevant legal requirements, the provisions and recommendations in the revised QCA Corporate

Governance Code 2023.

The committee will meet up to twice per annum. Appointments to the committee will be made

by recommendation of the Board. No further appointments are expected until the number of

NEDs on the Board increases.

Compliance Committee

Simon Charles is the chair of the Compliance Committee and Louise Adrian and Kristoffer

Andersson are members of the committee. (Mr Andersson joining on his appointment to the

Board and Martin). Martin Wood was a member of this Committee during the reporting period.

The principal purpose of the Compliance Committee is to ensure that the Company complies

with its obligations under the Listing Rules and, in particular, makes timely and accurate

disclosure of all information that is required to be disclosed to meet its disclosure obligations

arising from the admission of its shares to trading on the Official List. The Compliance

Committee will meet as required and is responsible for ensuring that the Group’s compliance is

proactive and properly monitored, controlled and undertaken. The Compliance Committee is

responsible for the scope and effectiveness of the compliance by the Group with statutory and

regulatory requirements. The Company Secretary will prepare the minutes and circulate

agendas for meetings.

The skills and experience of the members of the Board are set out in their biographical details

below. Since its move to the LSE the balance of the Board grew to have more gender and

ethnic diversity and although the Board meets the diversity targets as detailed out in Policy

Statement PS 22/3 of the Listing Rules and DTR requirements, on gender, it no longer meets

this target for ethnicity. The Board believes it has achieved a good balance of experience in

financial and operational matters and believes it has the skills and experience necessary to

execute the Company’s strategy and business plan and discharge its duties effectively.

On listing all of the Directors received training from their corporate advisers on the continuing

obligations of a company admitted to the Official List (equity shares (transition)) category and a

copy of the QCA Code and the Group’s Financial Position and Prospects Procedures

memorandum (FPPP) which sets out the policies and procedures that the Directors are

expected to follow. More recently, the Board has read the revised QCA Code and is ensuring

that it becomes, where appropriate, embedded in the Company’s policies and procedures.

All Directors have access to the Corporate Advisers, Novum Securities Ltd, and Company

Secretary, Orana Corporate LLP, who are able to keep the Directors informed of developments

in relevant legislation, regulations and best practice, when requested.

The CEO provides information and updates on the geology and technical matters and the CFO

provides regular guidance on changes in financial reporting.

All Directors are encouraged to raise their personal development or training needs with the Chair

or through the Board evaluation process. As a Member of the European Geologist Federation,

the CEO must meet annual continuous professional development (CPD) targets to maintain his

EurGeol title and the CFO, as a member of the ICAEW must also meet annual CPD targets.

Board Advice During the Period

The Board did not receive any advice during the period except from its Corporate Finance

Advisers, Novum, regarding the process involved in the secondary raise.

Biographies of the Board are as included below.

Cédric Valery Gerard Simonet (Chief Executive Officer)

Cédric Simonet holds a PhD in Geology and has 25 years’ experience exploring, developing

and mining mineral deposits in Africa and in France. He was Head Geologist and Open Pit

Manager at SOGEREM fluorspar mine (Alcan, France) and Africa Region Manager with IGE

Resources AB. He was the Head of Drilling at AAA Drilling Ltd and General Manager of

NuEnergy Gas Ltd during the same period between 2013 and 2014, before holding the role of

General Manager at NuAfrica Gas between 2014 and 2017. He is a co-founder of Akili Minerals

Services Ltd., a Nairobi based exploration services company, and has been involved in several

exploration projects on REE-carbonatites in Kenya including Ruri, Homa Mountain, Buru and

Mrima. He is also a former Chairman of the Kenya Chamber of Mines, and well experienced in

operating in this and many other African countries.

Cédric is a member of the European Geologists Federation (Eur Geol no 739). He qualifies to

act as a Competent Person (JORC) and as a Qualified Person (NI43-101) on REE-carbonatite

exploration projects.

Louise Adrian (Chief Financial Officer)

Louise Adrian has worked as Altona’s accountant for 4 years helping to strengthen both the

accounting and corporate governance reporting. She graduated from Oxford University with an

MA in Theology and is a member of the Institute of Chartered Accountants in England and

Wales. She started her career at Arthur Andersen in London where she gained experience with

global energy companies, auditing accounts, reviewing financial and budgetary controls, and

critiquing operational strategies. Since 2020, Louise has been a consultant for Orana Corporate

LLP (“Orana”), a corporate advisory and services practice, where she has worked with

established and newly listed companies, creating corporate governance protocols, producing

annual report and accounts, group consolidations and cash flow analysis. Louise also holds a

PGCE in secondary education and is a Finance Trustee for a Multi Academy Trust where she

has helped to establish a framework for good governance and risk management.

Louise joined the Board at listing to strengthen its financial reporting processes and to bring her

experience of group reporting and corporate governance protocols to the Company.

Simon Charles (Non-Executive Director/Chair)

Simon is a solicitor and is a senior partner at City solicitors Marriott Harrison LLP, having joined

the firm in 2004.

He specialises in company law, with a particular emphasis on acquisitions and disposals,

directors’ duties, equity and debt fundraises and shareholders’ rights, in each case in relation to

private and public companies. He has previously worked at Dechert LLP and a US law firm in

the City. Immediately prior to joining Marriott Harrison LLP he spent a number of years in the

corporate finance department of Numis Securities Limited (now Deutsche Numis) where he

advised private and public companies on debt and equity fundraises, acquisitions and

restructurings.

Simon joined the board at listing to head up the various committees and bring his legal,

compliance and corporate finance experience to the Company.

Kristoffer Andersson (Non-Executive Director) – appointed on 1

August 2024

Mr Andersson is an economist with extensive experience in the renewable energies, mining,

commodity trading and natural resources sectors, as well as investment banking in emerging

markets in Latin America and Africa. He has served on the Board of Directors for both private

and public companies across various industries, and co-founded Ashmont Resources Corp, a

Canadian private company focusing on high-value mineral assets in Colombia.

Mr Andersson is currently the CEO of Ironveld Plc, a mining company and speciality metals

producer based in South Africa, listed on the AIM Market of the London Stock Exchange.

Principle Eight (previously seven)

Evaluation of Board Performance

The ultimate measure of the effectiveness of the Board is the Company’s progress against the

long-term strategy and aims of the business. Appraisals are expected to take place in the

coming year for the Executive Board and key corporate targets as well as personal targets

appropriate to each Director are to be set by the Remuneration Committee. Evaluation of the

NEDs will be undertaken on an ad-hoc basis and the Board intend to set up a process for peer

appraisal and introduce a board effectiveness questionnaire in the coming year.

Principle Nine (new principle)

Establish a remuneration policy which is supportive of long-term value creation

The revised QCA Code emphasises the importance of aligning remuneration policies with the

Company’s purpose, strategy, and culture, ensuring they incentivise management to focus on

long-term sustainable growth. It also recommends that shareholders have a voice in

remuneration policies and reporting. The Remuneration Committee will take this new principle

into account as it sets Board remuneration for the coming year. The Committee believes that its

new long-term incentive scheme is consistent with Principle 9 of the QCA Code, ensuring that

remuneration structures are transparent and support long-term value creation for shareholders.

Principle Ten

Shareholder Communication

The Company actively engages with its shareholders, who form its key stakeholder group, and

encourages open communication and feedback. The Company’s website is regularly updated

to ensure shareholders have access to the latest information. Cedric Simonet, the Company’s

CEO, is responsible for managing shareholder communications, and his contact details are

available on the website for any shareholder or stakeholder inquiries. Additionally, shareholders

can engage with the CEO through the Investor Hub platform to raise questions and seek

clarification on recent Regulatory News Service (RNS) announcements.

The Company’s website also hosts a comprehensive range of key documents, including

financial reports, Notices of General Meetings, and Voting Results, ensuring shareholders have

easy access to all relevant updates and information.

REPORT OF THE AUDIT COMMITTEE

This report is prepared in accordance with the Quoted Companies Alliance (QCA) corporate

governance code for small and mid-sized quoted companies, revised in April 2018 and revised

in 2023. A summary of the Committee’s role and membership can be found in the Governance

section of this Annual Report. Committee meetings are held at least twice a year, and the

external accountant is invited to attend together with the external auditor. During the 2023/4, two

meetings of the Committee were held, and the following significant issues were considered:

nificant issue Summar

of si

nificant issue Actions and conclusion

Valuation of

Exploration and

Evaluation assets

The carrying value of intangible

assets related to exploration and

evaluation assets amounted to

£1.6m as at 30 June 2024 and as

such, is material. The value of

these assets is dependent on the

successful development of the

areas of mineral interest and

production of the mineral. The

exploration and evaluation assets

recognised are in respect of the

Monte Muambe Licence.

Management is required to assess

by reference to IFRS 6 Exploration

and Evaluation Assets, whether

there are potential indicators of

impairment of the Group’s

exploration and evaluation assets

at each reporting date and, if

potential indicators of impairment

are identified, management are

required to perform a full

assessment of the recoverable

value of the exploration and

evaluation assets in accordance

with IAS 36 Impairment of Assets.

Given the inherent judgement

involved in the assessment of

whether there are indications of

impairment in exploration and

evaluation assets, as required by

IFRS 6, there is a risk the carrying

amount of exploration and

evaluation assets are overstated

and should be impaired.

The Company has a legal right to explore the

licence at Monte Muambe and have applied for a

mining licence which is expected to be issued by

the government in the near future.

Management prepared an assessment of

impairment indicators and considered whether

there are any of the indicators of impairment in

line with the criteria set out in IFRS 6. This did not

highlight any impairment indicators and as such

an IAS 36 impairment assessment was not

required.

No exploration costs were capitalised with

respect to the additional exploration licences

which were acquired after the year end.

Valuation of

Investments in

subsidiaries and

recoverability of

intercompany

receivables

(Company)

The parent company holds material

investments as at 30 June 2024 of

£346,000 (2023: £208,000). There

is also a material intragroup loan of

£1,705,000 (2023: £1,425,000) as

the parent company funds

exploration activity in Mozambique.

Given that Monte Muambe Mining,

LDA (“MMM”) with reference to the

underlying flagship project “Monte

Muambe” is loss making and the

other subsidiaries are either

insubstantial or dormant, there is a

risk that the investment in

subsidiaries and intra group

receivables, where intangible

assets under development are the

main assets of the subsidiaries,

may not be fully recoverable.

The exploration programme at MMM has entered

Phase 3 and the Company now own 51% of

MMM. The MRE and Scoping Study, published

in the second half of 2023, both indicate the value

of the MMM asset to be far more significant than

either its current carrying value or intragroup

balance.

The Directors concluded that the investment and

intragroup balances are expected to be fully

recoverable.

See also the impairment assessment noted

above.

Going concern Assessment of the Groups’ ability

to continue as a going concern as

part of the preparation of the

financial statements. This includes

considering whether the Group has

adequate resources to continue in

operation for the foreseeable future

from the date of anticipated signing

of the financial statements. The

assessment of going concern

covers a period of at least 12

months from the date of signing the

financial statements.

On 19 July 2024, the Company converted the

majority of its outstanding pre-IPO CLN and

raised further funds of £394,000 from the issue of

shares and £900,000 in debt facilities.

These funds are expected to provide the Group

with enough working capital to fund it through to

the end of the first quarter of 2025. As a result,

the Group will need to raise funding to provide

additional working capital within the next 12

months. The ability of the Group to meet its

projected expenditure is dependent on these

further equity injections and/or the raising of cash

through bank loans or other debt

instruments/government grants or exercise of

warrants. These conditions necessarily indicate

that a material uncertainty exists that may cast

significant doubt over the Group’s ability to

continue as a going concern and therefore their

ability to realise their assets and discharge their

liabilities in the normal course of business. Whilst

acknowledging this material uncertainty, the

Directors remain confident of raising finance,

through one of the means stated above, and

therefore, the Directors consider it appropriate to

prepare the consolidated financial statements on

a going concern basis.

Warrants

(disclosure and

valuation)

During the year a material number

of warrants were issued in order to

pay for services received for the

raising of finance. The valuation of

the warrants is a significant

accounting estimate and highly

judgemental in nature. There is a

risk that the warrants are valued

and disclosed incorrectly in the

financial statements.

Management used inputs from external sources

in order to appropriately calculate the value of

these warrants issued and ensure that the cost of

these were properly accounted for as part of

finance costs.

Carrying value

and recoverability

of VAT debtor

The group has a material VAT

receivable balance as at 30 June

2024. This is a long standing

receivable and therefore there is a

risk that the balance is no longer

receivable and therefore

overstated in the financial

statements.

Management has engaged local tax specialists

who have confirmed the high likelihood of

recoverability of the majority of this balance.

Therefore, the Directors have confident that the

majority of this balance is not impaired and have

provided against 23% of the total.

External Auditor’s Fees for Non-Audit Services

The external auditor is acting as the Company’s Reporting Accountant. This was approved by

the Committee as they have concluded that it did not affect the independence or objectivity of

the external auditor and is considered to be one-off non-recurring work. Fees paid during the

year for audit and non-audit services may be found in note 5 to the accounts.

Objectivity and Independence

The Committee continues to monitor the Auditor’s objectivity and independence and is satisfied

that PKF and the Company have appropriate policies and procedures in place to ensure that

these requirements are not compromised.

Re-appointment of External Auditor

The Committee recommends to the Board the re-appointment of PKF Littlejohn LLP as Auditor

at the forthcoming 2024 Annual General Meeting (AGM), and PKF Littlejohn LLP has expressed

its willingness to continue in office.

Internal controls/audit

The Directors acknowledge their responsibility for the Groups’ system of internal control and for

reviewing their effectiveness. These internal controls are designed to safeguard the assets of

the Group and ensure the reliability of financial information for both internal use and external

publication. Whilst the Directors are aware no system can provide absolute assurance against

material misstatement or loss, regular review or internal controls are undertaken to ensure that

they are adequate and effective.

The Group does not currently have an internal audit function due to the small size of the Group

and limited resources available. The requirement for an internal audit function is kept under

review.

Whistleblowing

The Group has adopted a formal whistleblowing policy which aims to promote a very open

dialogue with all its employees which gives every opportunity for employees to raise concerns

about possible improprieties in financial reporting or other matters.

The Bribery Act 2010

The Board is committed to acting ethically, fairly and with integrity in all its endeavours and

compliance of the code is closely monitored.

Market Abuse Regulations

The Group is required to comply with article 18(2) of the Market Abuse Regulation (“MAR”) with

reference to insider dealing and unlawful disclosure of inside information. The FCA requires

traded companies to maintain insider lists as set out in the MAR. The Board has put in place a

MAR compliance process and has established a Compliance Committee. This and the

Company’s regulatory announcements are overseen by the Board of Directors.

ENVIRONMENT, SOCIAL AND GOVERNANCE STATEMENT

Environmental Minimise our footprint and strive to be a leader in environmental sustainability

by bringing rare earths to the world in a manner that minimises or eliminates

environmental impacts.

Social Protect our workers through good health and safety and develop our people

through training, inclusion and retention. Hiring and training local people were

possible.

Governance Application of sound corporate governance as set out on pages 22 to 32 of

this report.

The Group strives to be a leader in environmental sustainability and believes that a successful

future for our business and the customers we serve depends on the sustainability of the

environment, communities and economies in which we operate. Altona undertakes its

exploration activities in a manner that minimises or eliminates negative environmental impacts

and maximises positive impacts of an environmental nature. Altona believes that the

environmental impact associated with its activities should be kept to the minimum. To ensure

proper environmental stewardship on its projects, and compliance with applicable legislation,

Altona conducts preliminary assessments and environmental management plans prior to

starting exploration activities and ensures that areas explored are properly maintained and

rehabilitated.

We are committed to minimising the impact of our operations on the environment and to

demonstrating leadership by integrating environmental considerations into all our business

practices.

Our employees are the driving force behind our exploration activities. We seek to treat our

people fairly and with respect and ensure they have the opportunity to develop and reach their

potential. We comply with the labour legislation where we work. Most of our staff is employed

from the local community. Learning and training activities are central to staff engagement and

we provide on-the-job training. In the FY 2023, this included equipment operation and quality

management (standard operating procedures) training, as well as first-aid training for all

employees. In the FY 2024, the employees took part in Drilling Sampling SOP training, to ensure

that they were all able to implement the new sampling procedure and Measurement Instrument

training was provided for technical staff, which focused on laboratory analyses and RTK survey

information.

Other local stakeholders include our contractors, suppliers, business partners, local

communities and government authorities, including all individuals who live in proximity to our

operations or who may be impacted by our business relationships. The Company endeavours

to support and make as much use as possible of local service suppliers.

Climate-Related Financial Disclosures

The Group recognises that climate change represents one of the most significant challenges

facing the world today. Under the Listing Rules compliance with the Task Force on Climate-

Related Financial Disclosures (TCFD) is required for all listed companies on a comply or

disclose basis.

TCFD Purpose

In contrast to the Streamlined Energy and Carbon Reporting (SECR) disclosures which requires

listed companies to disclose their greenhouse gases emissions, CO

and energy usage, TCFD

is primarily designed to protect shareholders from the impacts of climate change by ensuring

companies disclose key information within these areas and communicate how they’re thinking

about and assessing climate-related risks and opportunities as part of their resilience and risk

assessment processes.

TCFD adherence requires disclosure of greenhouse gas (GHG) emissions as part of the Metrics

and Targets section. This creates a degree of overlap with SECR requirements, however

TCFD’s focus is understanding how GHG emissions may expose a company to future changes

in law, regulation or market dynamics which penalise higher polluting industry sectors, sub

sectors or companies.

Climate Change Risks and Opportunities

The following table includes our TCFD disclosures and where necessary explanations why the

Group has not fully met them and the Board’s plans to implement these in future.

Governance, Strategy, Risk Management, Metrics and Targets

Governance Management of climate-related risks and opportunities

Board’s oversight The Company does not currently have a climate risk committee

although climate risk is discussed at board meetings when relevant.

A climate risk committee will be implemented when deemed

necessary, most likely once a development project reaches DFS

stage, prior to financing and implementation.

Since our purpose, strategy and business plan are to capitalise on

climate change by providing the materials the world needs to reduce

its impact, we understand that climate change opportunity is

embedded in our activity and that we need to ensure that the raw

materials we produce or will produce are delivered in the least

damaging way.

Assessment and

management

The Board have started to consider the carbon footprint of its future

products at MM and ways to reduce it. This is conceptual at this

stage, but it is important to start early in order to integrate low

emissions and climate change reduction options in all relevant parts

of the project (energy mix, procurement, carbon credits).

MMM will engage environmental consultants as part of regulatory

compliance for its operations: EMPs, environmental audits, EIAs. It

has also engaged a consultant to do a Fatal Flaw Analysis as part of

the Scoping Study.

Strategy Approach to both the actual and potential impacts of climate-related

risks and opportunities

Risks and opportunities

Climate related issues identified and discussed include:

Opportunities (mostly medium-long term)

1. Producing rare earths to enable the world’s energy transition.

2. Supplying products that can satisfy Responsible Sourcing

demand (including certification and auditing).

3. Net zero objective (ambitious).

Risks (some are short term)

1. Competition with China, which is aggressively acquiring raw

material sources in Africa.

2. Non-Climate Change environmental and social impact that also

need to be mitigated.

3. Availability of a suitable downstream supply chain to ensure the

project’s sustainability including on Climate Change matters.

Strategy Climate Change actions are integrated in studies from an early stage.

Risk Management How the Group identifies, assesses and manages climate-related

risks

Risk identification

The Company has identified key climate change related risks as

follows:

1. Competition for minerals projects.

2. Competition for equity capital.

3. Climate change physical impacts on jurisdiction and regions

where metals and minerals deposits are located.

4. Potential for higher input costs, notably for fossil fuels and

building materials such as cement and steel.

5. Reduced demand for metal concentrates which have been

produced using higher than average GHG emissions energy such

as coal fired power.

6. Non Climate Change environmental risks.

Processes and

management

The Company’s strategy is to acquire and develop rare earths mining

projects which will enable the world’s transition to renewable energy.

A key part of the mine development process is the Pre-Feasibility

Study (PFS), which includes investigations into mine emissions

(gases and fluids) and waste (including tailings). The PFS also

includes:

1. Investigations into the use of new technologies (especially

renewable sources of energy such as solar).

2. Environmental baseline studies.

3. Water supply studies, rainfall pattern change, and regional

hydrogeology.

4. Climate and weather patterns including average monthly

temperatures.

The PFS is authored by independent technical experts and managed

by senior management and board members.

For new project acquisitions, the company’s due diligence processes

include a desktop review which cover all the above potential risks and

opportunities.

Metrics and Targets

Disclose the metrics and targets used to assess and manage

relevant climate-related risks and opportunities

GHG metrics The Company’s GHG emissions are currently low due to the nature

of operations. During the period under review the main GHG emitters

were:

1. International/domestic travel to and from site in Mozambique

and Botswana and international travel for fund raising.

2. Employee / contractor accommodation and associated energy

use.

3. Exploration drilling and associated logistics.

As noted in the Company’s SECR disclosure below, energy usage

was below 40,000 kWh and as a result complete Scope 1, 2 and 3

GHG data was not collected. During 2024/5 the Group will implement

improved GHG data collection methodology at the Company and

subsidiary levels although it expects GHG emissions and energy

usage to remain relatively low.

Climate related physical

risks

The Company’s exposure to physical risk relates to changes to the

environment where its exploration operations are based. The

Company is working to identify these physical risks and then will be

able to provide metrics and targets to monitor this risk.

At the UK Company level, the Directors ensure that climate change risks and opportunities are

embedded in strategy. The Directors are of the view that the global demand for rare earth

elements will continue to rise, driven by the world’s transition to renewable energies and hence

its own strategy to explore for and develop these minerals is aligned to TCFD opportunities and

will result in share price appreciation.

Governance will be strengthened to ensure reporting on these climate related risks is meaningful

and transparent. Risk Management will include a process for identifying, assessing, and

managing climate-related risks and the Group will establish various metrics and targets to

assess climate-related risks and opportunities.

Streamlined Energy and Carbon Reporting (SECR)

The Group’s current operations are limited to exploration activities in Mozambique and due

diligence activities in various other jurisdictions (including Botswana for 2024/25) where it has

and will continue to assess potential development projects for investment.

An estimation of GHG emissions is based on:

- Fuel consumption (journey distance in miles for international air travel, domestic air and land

travel);

- Energy use at the camp in Mozambique can be calculated on a daily basis for when the

camp is in operation, based on fuel and cooking gas consumption. Much of the energy used

is already generated by solar which has zero GHG emissions. The operations here

employed an average of 8 people (2023: 14 people), sharing accommodation and using one

vehicle; and

- Other significant GHG emissions related to contractor drilling activity which consisted of one

drill rig operating for a combined period of 184 hours and transportation of raw materials to

Canada for metallurgical work (2023: 550 hours and transportation of raw materials to

Australia for assay).

One of the requirements of the SECR initiative is to report energy use that is used to calculate

the GHG emissions reported in the Directors’ Report. This needs to be provided in kilowatt hours

(kWh).

However, only quoted companies and large unquoted companies that have consumed more

than 40,000 kilowatt-hours (kWh) of energy in the reporting period must include energy and

carbon information within their Directors’ report. The Company does not currently exceed this

threshold and is therefore presently exempt from the SECR reporting requirements.

The Group will work to minimise its contribution to GHG and will maintain this focus in all future

operations. The Group intends to publish GHG and energy emissions data in line with the SECR

regulations as the Group’s projects develop. As explained in the TCFD disclosure the company

will be implementing improved GHG data collection processes throughout the Group during

2024/5.

Approved on behalf of the Board of Directors.

Simon Charles

Non-Executive Chair

DIRECTORS’ REPORT

The Directors present their report, together with the audited consolidated financial statements,

for the year ended 30 June 2024.

Company Information

Altona Rare Earths Plc (the “Company”) is a publicly listed company incorporated and

domiciled in England & Wales. Its registered offices are at Eccleston Yards, 25 Eccleston

Place, London SW1W 9NF.

On 9 June 2023, the Company announced the admission of the Company’s entire issued share

capital to the Official List of the Financial Conduct Authority by way of a Standard Listing under

Chapter 14 of the Listing Rules and to trading on the London Stock Exchange's Main Market

for listed securities ("Admission"). The Company’s shares are listed under the new ticker

“REE”. From 29 July 2024, this two tier system was replaced and the Company is now in the

“Equity Shares - Transition” category.

The Company’s principal activity is focused on the discovery and development of Critical Raw

Materials mining projects in Africa.

Results And Dividends

The loss for the year before taxation amounted to £1,672,000 (2023: loss of £1,296,000).

The Directors do not recommend the payment of a dividend (2023: £Nil).

The nature of the Company’s business means that it is unlikely that the Directors will

recommend a dividend in the near future. The Directors believe the Company should seek to

generate capital growth for its Shareholders. The Company may recommend distributions at

some future date when it becomes commercially prudent to do so, having regard to the

availability of the Company’s distributable profits and the retention of funds required to finance

future growth.

Financial Risk Management

Note 3 of the financial statements details the financial risk factors affecting the Group and

summarises the Group’s policies for mitigating such risks through holding and issuing financial

instruments. These policies have been followed during the current and prior year.

Directors’ And Officers’ Indemnity Insurance

During the financial year, the Group maintained insurance cover for its Directors and Officers

under a Directors’ and Officers’ liability insurance policy. The Group has not provided any

qualifying indemnity cover for the Directors.

Business Review, Future Developments And Key Performance Indicators

A review of the business, future developments and key performance indicators are outlined in

the Chairman’s Report and the Strategic and Corporate Governance Report.

Directors And Directors’ Interests

The Directors who held office during the year under review, and as at the date of this report,

were as follows:

Louise Adrian

Cédric Simonet

Kristoffer Andersson (appointed 1 August 2024)

Simon Charles

Audrey Mothupi (resigned 1 August 2024)

Martin Wood (resigned 10 August 2024)

The beneficial interests of the Directors who held office at 30 June 2024 and their connected

parties in the share capital of the Company is included in the Remuneration Report on pages

41 - 47.

Substantial Shareholders

The Company has been notified of the following interests

of 3 per cent. or more in its issued

share capital as 1 October 2024.

Number of

Ordinary shares

Percentage

of holding

Tracarta Ltd 32,500,000 19.94%

Hargreaves Lansdown Stockbrokers 13,408,316 8.23%

RS & CA Jennings 11,650,000 7.15%

Optiva Securities Limited 11,042,367 6.77%

Spreadex Limited 7,950,000 4.88%

Halifax Share Dealin

Limited 6,286,429 3.86%

Christian Ta

lor

–

Wilkinson 6,271,437 3.85%

SI Capital Ltd 5,585,954 3.43%

IG Markets Limited 5,382,482 3.30%

Directors’ Remuneration

Directors’ remuneration is disclosed in the Directors’ Remuneration Report on pages 41 - 47.

Post Reporting Date Events

Details of post reporting date events are disclosed in Note 22 of the financial statements.

Environmental And Social Governance (“ESG”) And Streamlined Energy And Carbon

Reporting

This is referred to in the Corporate Governance Report on pages 33 to 36.

Political And Charitable Contributions

No charitable or political donations were made in either year.

Going Concern

The Group and Company raise money for exploration and capital projects as and when

required. There can be no assurance that the Group and/or Company’s projects will be fully

developed in accordance with current plans or completed on time or to budget. Future work on

the development of these projects, the levels of production and financial returns arising

therefrom, may be adversely affected by factors outside the control of the Group or Company.

An operating loss is expected in the 12 months subsequent to the date of these financial

statements. As a result the Group and Company will need to raise funding to provide additional

working capital within the next 12 months. The ability of the Group and Company to meet its

projected expenditure is dependent on these further equity injections and / or the raising of

cash through bank loans or other debt instruments/and or government grants and/or loans.

These conditions necessarily indicate that a material uncertainty exists that may cast

significant doubt over the Group and Company’s ability to continue as a going concern and

therefore their ability to realise their assets and discharge their liabilities in the normal course

of business. Whilst acknowledging this material uncertainty, the Directors remain confident of

raising finance and therefore, the Directors consider it appropriate to prepare the consolidated

and parent company financial statements on a going concern basis. The consolidated and

parent company financial statements do not include the adjustments that would result if the

Group and Company were unable to continue as a going concern.

Provision Of Information To Auditor

The Directors who held office at the date of approval of this Report of the Directors confirm

that, so far as they are individually aware, there is no relevant audit information of which the

Company’s auditor is unaware; and each Director has taken all the steps that they ought to

have taken as Director to make themselves aware of any relevant audit information and to

establish that the auditor is aware of that information.

Auditor

PKF Littlejohn LLP have expressed their willingness to continue in office and a resolution to

re-appoint them will be proposed at the annual general meeting.

Annual General Meeting

This report and the Financial Statements will be presented to shareholders for their approval

at the Company’s Annual General Meeting (“AGM”). The Notice and date of the AGM will be

notified to the shareholders on the website and through an RNS.

Corporate Governance

A report on Corporate Governance can be found in the Corporate Governance Report on page

22 to 36 of these financial statements. The Corporate Governance Report forms part of this

directors’ report and is incorporated into it by cross reference.

Website Publication

The Directors are responsible for ensuring the Annual Report and the financial statements are

made available on its website. Financial statements are published on the Company’s website

in accordance with legislation in the United Kingdom governing the preparation and

dissemination of financial statements, which may vary from legislation in other jurisdictions.

The maintenance and integrity of the Company’s website is the responsibility of the Directors.

The Directors’ responsibility also extends to the ongoing integrity of the financial statements

contained therein.

Statement Of Directors’ Responsibilities

The Directors are responsible for preparing the Annual Report, Report of the Directors and the

financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year.

Under that law the Directors have elected to prepare the Group and Company financial

statements in accordance with UK-adopted international accounting standards. Under

company law the Directors must not approve the financial statements unless they are satisfied

that they give a true and fair view of the state of affairs of the Group and Company and of the

Group profit or loss for that period.

In preparing these financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgments and accounting estimates that are reasonable and prudent;

• state whether applicable UK adopted international accounting standards have been

followed, subject to any material departures disclosed and explained in the financial

statements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to

presume that the Group and Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to

show and explain the Company’s transactions and disclose with reasonable accuracy at any

time the financial position of the Group and Company and enable them to ensure that the

financial statements comply with the Companies Act 2006. They are also responsible for

safeguarding the assets of the Group and Company and hence for taking reasonable steps for

the prevention and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and financial

information included on the Company’s website. Legislation in the United Kingdom governing

the preparation and dissemination of the financial statements may differ from legislation in

other jurisdictions.

Directors’ Responsibility Statement Pursuant To Disclosure And Transparent Rules

Each of the Directors, whose names and functions are listed on page 3 confirm that, to the

best of their knowledge and belief:

• The Financial Statements prepared in accordance with UK adopted international

accounting standards and give a true and fair view of the assets, liabilities, financial position

and loss of the Group and Company; and

• the Annual Report and Financial Statements, including the Business review, includes a fair

review of the development and performance of the business and the position of the Group

and Company, together with a description of the principal risks and uncertainties that they

face.

This report was approved and authorised for issue by the board on 30 October 2024 and

signed on its behalf by:

Dr Cédric Simonet

CEO

Altona Rare Earths Plc

REMUNERATION REPORT

PART 1 – INTRODUCTION

On behalf of the Board, I am pleased to present the Company’s Remuneration Committee

Report, which sets out the remuneration policy and the Directors’ remuneration for the year

ended 30 June 2024. The Company has resolved to comply with the provisions of the Quoted

Companies Alliance Corporate Governance Code (QCA Code) so far as is practicable given

the Company’s size, nature and stage of development and has prepared this report with regard

to the QCA Remuneration & Nominations Committee Guide for small and mid-sized quoted

companies, revised in 2018. It will also take into account the revised QCA Code 2023 in its

remuneration decisions made in the coming year. A summary of the Remuneration

Committee’s role and membership can be found in the Governance section of this annual

report.

Remuneration Policy

The Remuneration Policy is intended to fit the current size and profile of the Group, to support

the achievement of the Group’s operational, business, financial and strategic objectives and

align the interests of the Directors with shareholders over the short and longer term. To achieve

our goals, the Group seeks to provide competitive overall pay, split between fixed and

performance-related elements.

The Company also intends to operate a structured long-term incentive strategy entailing

awards of options granted annually subject to relative shareholder return and corporate

targets.

Remuneration Committee

Remuneration Committee meetings are expected to be held at least twice during the year.

Additionally, matters for its consideration were discussed at Board meetings on several

occasions. On each occasion, no Director was present while matters concerning him or her

were discussed, and all decisions were taken by Non-Executive Directors, in accordance with

the Remuneration Committee’s Terms of Reference. The Remuneration Committee comprises

Kristoffer Andersson (Chair) and Simon Charles, both of whom have been deemed by the

Board to be independent.

Context within which remuneration managed

As detailed elsewhere in this annual report, during the financial year the Company achieved

its objectives of increasing its ownership in Monte Muambe to 51% (in December 2023), the

publication of the MRE (in September 2023) and Scoping Study (in October 2023). The

Company also announced its portfolio expansion and diversification strategy in February 2024

and made its first step towards this on 29 July 2024 when it exercised its option to acquire an

interest in the prospecting licence PL2329/2023 located in Botswana.

Principal actions and decisions during the year

The principal decisions in respect of remuneration taken during the year were:

• During 2023/4, due to the continued focus on cashflow management, the Company

responded by agreeing with its Executive and Non-Executive Directors, with effect from

1 November 2023, that 50% of their salary/remuneration would be deferred until the cash

position of the Company improved. In July 2024, it was agreed that 60% of this deferred

remuneration for all Non-Executives would be paid in Ordinary Shares in the Company,

reducing the Company’s accrued cash salary costs.

• The Finance Director has agreed to continue to take her net salary in shares. This part

of the salary will be paid by the issue of ordinary shares of the Company quarterly in

arrears priced at the 10-day VWAP immediately prior to the end of the relevant quarter

(being August, November, February and May) and will continue until economic

conditions allow the full salary to be paid in cash.

• Reduction of Chair’s remuneration from £60,000 to £37,500 per annum to reflect the

increased experience of the Executive Board and a more commercial rebase of the basic

Chair remuneration.

PART 2 - REMUNERATION POLICY

The ongoing policy of the Remuneration Committee is to provide competitive remuneration

packages to enable the Group to retain and motivate its key Executives and to cost-effectively

incentivise them to deliver long-term shareholder value.

The Remuneration Committee keeps itself informed of relevant developments and best

practice in the field of remuneration and seeks advice where appropriate from external

advisers. It maintains oversight of the remuneration of all employees, which is the responsibility

of the Chief Executive Officer.

The remuneration policy for the Non-Executive Directors is determined by the Board,

considering best practice and the Articles of Association. It is the aim of the Remuneration

Committee to reward key Executives for delivering value for the Group and for shareholders.

The Remuneration Committee also applies the broader principle that the Company’s Executive

remuneration should be competitive with the remuneration of directors of comparable

companies.

Components of the remuneration package:

The main components of the remuneration package for Executive Directors and Senior

Management are:

• Base salary;

• Pension and other benefits;

• Performance-related annual bonus scheme; and

• Long-term incentive plan (“LTIP’’).

Base salary

The policy is to pay a fair and reasonable base salary, supports the recruitment and retention

of Executive Directors of the calibre required to fulfil the role without paying more than

necessary. Reflects skills, experience, role. The base salary is reviewed at least annually by

the Remuneration Committee, having regard to the performance of the Company and

economic conditions and taking note of any changes to an individual’s job scope.

Pension and other benefits

The Company pays for a pension contribution of 3% of base salary for eligible Executive

Directors and Senior Management.

Performance-related bonus scheme (not yet implemented)

Rewards and incentivises the achievement of annual objectives for Executive Directors and

Key Senior Employees. The annual objectives are aligned with key strategic goals and

supports the enhancement of shareholder value. Maximum potential values will not exceed

50% of base salary in any year.

Existing arrangements are set out in the annual report section below. Pre-defined operational,

financial and/ or other targets are set to be achieved by specified dates triggering the payment

of specified amounts. Weighting of individual KPIs remaining at 60% and the weighting of

corporate KPIs remaining at 40% of the total. Awards subject to targets may be set at any time

and are not set on an annual basis.

Annual bonus is calculated based on the achievement of each objective. Bonuses are non-

pensionable. Bonuses may be paid in cash or in shares at the Committee’s discretion.

Long term incentive plan

Incentivises Executives and Senior employees to achieve the Company’s long term strategy

and create sustainable shareholder value. Aligns with shareholder interests through the

potential delivery of shares. Award of options under a share award plan which vest subject to

operational, financial and or share price targets to be achieved by specified dates triggering

the payment of specified amounts.

Non-Executive fees

Fees for Non-Executive Directors are set at an appropriate level to recruit and retain directors

of a sufficient calibre without paying more than is necessary to do so. Fees are set taking into

account the following factors: the time commitment required to fulfil the role, typical practice at

other companies of a similar size, and salary levels of employees throughout the Group. Fees

are reviewed at appropriate intervals (normally once every year) by the Board with reference

to individual experience, the external market and the expected time commitment required of

the Director.

Non-Executive share awards

To help attract, retain, and motivate Non-Executive Directors with the necessary skills, and to

align their interests with those of shareholders, the Company intends to grant one-time awards

of options. The exercise price will be determined by the Board at an appropriate level. The

options will vest immediately, with no performance conditions other than continued service,

and will expire three years after the date of grant.

Description of KPIs for the year ending 30 June 2025

For 2024/5, the KPIs for the Executives and Senior Management are in the process of being

reset to align with the Company’s objectives for the year ended 30 June 2025 at both corporate

and individual levels. The KPIs will be based on financial and work programme and cost

management. They are expected to be weighted at 40% for individual performance and 60%

for overall company performance.

Executive Directors’ Service Contracts

Executive Director Appointment date Service period Other information

Cédric Simonet 30 May 2023 90 days notice

in writing

Contract updated to replace COO

contract, effective 9 June 2023. Annual

salar

£120,000

Louise Adrian 30 May 2023 90 days notice

in writing

Effective 9 June 2023. Annual salary of

£24,000 to be satisfied quarterly in

shares* (based on a minimum of 2 days

per week). Louise also works as a

consultant for Orana Corporate LLP who

provide the Company with accounting

and bookkeeping services (see related

parties note 20

)

No payments have been made for compensation for loss of office. The Company has not paid

out any excess retirement benefits to any Directors or past Directors. The Company has not

paid any compensation to past Directors.

Non-Executive Directors’ Service Contracts

The Non-Executive Directors signed letters of appointment with the Company upon

appointment for the provision of Non-Executive Directors’ services, terminable by 3 months

written notice given by either party. The appointments are all intended to be for a term of 3

years.

Non-Executive Director Appointment date Other information

Martin Wood 26 October 2020 Salary reduced from £70,000 to £60,000 effective 9

June 2023 to be paid quarterly in cash and/or

shares*. Resigned 10 August 2024.

Simon Charles 30 May 2023 Annual salary reduced from £35,000 to £28,000,

effective 1 May 2024. Appointment of Chair,

effective 11 August 2024, with a salary of £37,500.

Audrey Mothupi

5 February 2021

Annual salary of £24,000. Resigned 1 August 2024.

Kristoffer Andersson 1 August 2024 Annual salary of £28,000.

*Shares are to be issued quarterly in arrears, at an issue price equal to the 10-day VWAP at the end of

such quarter.

The Non-Executive Directors’ remuneration (including that of the Chairman) reflects the

anticipated time commitment to fulfil their duties. Non-Executive Directors do not receive

benefits, a pension or compensation on termination of their appointments. In the future, they

could receive a set number of options relating to the Company’s LTIP.

When recruiting a new Non-Executive Director, the Remuneration and Nominations Committee

will follow the policy set out in the table above. The letters of appointment do not include any

provisions for the payment of pre-determined compensation upon termination of appointment

and notice may be served by either party. All appointments are subject to the Company’s

Articles of Association (Articles) and re-election by shareholders in accordance with the

provisions contained in the Articles. If the Board is contemplating a transaction that requires

more work than would normally be expected of Non-Executive Directors, their fees may be

increased by up to 100%, to a level to be determined by the Board at that time. The Directors

have responsibility to review, monitor and make recommendations to the Board regarding the

orientation and education of directors which includes an annual review of the Directors’

compensation programme.

Payment for loss of office

The Committee will honour all Director’s contractual entitlements. Service contracts do not

contain liquidated damages clauses. If a contract is to be terminated, the Committee will

determine such mitigation as it considers fair and reasonable in each case. There is no

agreement between the Company and its Directors or employees, providing for compensation

for loss of office or employment that occurs because of a takeover bid.

The Committee reserves the right to make additional payments where such payments are

made in good faith in discharge of an existing legal obligation (or by way of damages for breach

of such an obligation); or by way of settlement or compromise of any claim arising in connection

with the termination of an Executive Director’s office or employment.

PART 3 – REMUNERATION REPORT (AUDITED)

Directors’ Remuneration

Year ended

30 June

2024

Year ended

30 June

2023

% Change in

total salary

from prior

Salar

/Fees* Total Total

£ £ £

Non-Executive Directors

Simon Charles 33,833 33,833 2,139 N/

udre

Mothupi

24,000 24,000 24,000 0%

Martin Wood

60,000 60,000 69,583

(

13.8%

)

Simon Tucker

- - 2,000 N/

Sub-tota

117,83

97,72

Executive Directors

Louise Adrian 24,000 24,000 1,467 N/

Cédric Simonet 120,000 120,000 132,000

(

9.1%

)

Christian Ta

lor-Wilkinson

- - 181,821 N/

Sub-tota

144,000 144,000 315,288

Total 261,833 261,833 413,010

(

36.6%

)

Resigned 1 August 2024

Resigned 10 August 2024

Resigned 1

August 2022

Resigned 9

June 2023

*No Bonus or Pension was paid to the Directors during the year

Directors’ interests in shares

The Directors who held office at the end of the year had the following interests in the Ordinary

Shares of the Company:

30 June 2024 30 June 2023

Non-Executive Directors

Simon Charles - -

udre

Mothupi - -

Martin Wood 1,580,056 1,388,462

Sub-tota

1,580,056 1,388,46

Executive Directors

Louise Adrian 405,306 300,000

Cédric Simonet 925,711 855,711

Sub-tota

1,331,017 1,155,711

Senior Mana

ement

Christian Ta

lor-Wilkinson 6,086,844 3,862,371

Total 8,997,917 6,406,544

The Directors and Senior Management held 10.37% of the total share capital of the Company

at 30 June 2024 (2023: 7.77%). The shares issued to the Directors during the year were due

to both their involvement in the Placing and the issue of shares in lieu of cash payment for the

equivalent of 3 months salaries.

As at the date of this report the Directors had the following interests in the Ordinary Shares of

the Company:

Shares held % held

Louise Adrian 3,313,274 2.03%

Simon Charles 602,000 0.37%

Cédric Simonet 1,925,711 1.18%

Total 5,840,985 3.58%

Directors’ interests in warrants

The Directors who held office at the end of the year had the following interests in warrants to

acquire Ordinary Shares of the Company:

30 June 2024 30 June 2023

Non-Executive Directors

Simon Charles - -

udre

Mothupi - 100,000

Martin Wood 1,000,000 1,250,000

Sub-tota

1,000,000 1,350,000

Executive Directors

Louise Adrian 600,000 600,000

Cédric Simonet - 100,000

Sub-tota

600,000 700,000

Senior Mana

ement

Christian Ta

lor-Wilkinson 2,400,000 2,850,000

Total 4,000,000 4,900,000

Grant date Expir

date Life Numbe

Exercise price £

10 March 2021

10 March 2024

(

expired durin

the

ear

)

ears 900,000 £0.12

9 June 2023 9 June 2025 2

ears 2,000,000 £0.10

9 June 2023 9 June 2025 2

ears 2,000,000* £0.20

4,900,000

*piggyback warrants – see note 17 for further details

Relative importance of spend on pay

The table below illustrates the year-on-year change in total remuneration compared to

distributions to shareholders and operational cash flow for the financial periods ended 30 June

2024 and 2023:

Distributions to

shareholders

Total directors and

emplo

ee pa

Operational cash

outflow

£ £ £

Year ended 30 June 2024 Nil 490,000 1,061,000

Year ended 30 June 2023 Nil 518,000 649,000

Total employee pay includes wages and salaries, social security costs and pension costs for

employees in continuing operations. Further details on employee remuneration are provided

in note 6. Operational cash outflow has been shown in the table above as cash flow monitoring

and forecasting is an important consideration for the Remuneration Committee and Board of

Directors when determining cash-based remuneration for directors and employees.

Historical share price performance comparison

The Directors have considered the requirement for a UK performance graph comparing the

Company’s relative shareholder return with that of a comparable indicator and have concluded

that it would not give a meaningful comparison as the Company has only been trading on the

London Stock Exchange since 9 June 2023.

Consideration of shareholder views

The Board considers shareholder feedback received and guidance from shareholder bodies.

This feedback, plus any additional feedback received from time to time, is considered as part

of the Company’s annual policy on remuneration.

Approved on behalf of the Board of Directors.

Kristoffer Andersson, Chair of the Remuneration Committee

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ALTONA RARE EARTHS PLC

Opinion

We have audited the financial statements of Altona Rare Earths plc (the ‘parent company’) and

its subsidiaries (the ‘group’) for the year ended 30 June 2024 which comprise the Statement

of Consolidated Profit or Loss and Other Comprehensive Income, the Statement of

Consolidated Financial Position and the Parent Company Statement of Financial Position, the

Statement of Consolidated Cash Flows and the Parent Company Statement of Cash Flows,

the Consolidated Statement of Changes in Equity and the Parent Company Statement of

Changes in Equity and notes to the financial statements, including significant accounting

policies. The financial reporting framework that has been applied in their preparation is

applicable law and UK-adopted international accounting standards and as regards the parent

company financial statements, as applied in accordance with the provisions of the Companies

Act 2006.

In our opinion:

• the financial statements give a true and fair view of the state of the group’s and of the

parent company’s affairs as at 30 June 2024 and of the group’s loss for the year then

ended;

• the group financial statements have been properly prepared in accordance with UK-

adopted international accounting standards;

• the parent company financial statements have been properly prepared in accordance

with UK-adopted international accounting standards and as applied in accordance with

the provisions of the Companies Act 2006; and

• the financial statements have been prepared in accordance with the requirements of

the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs

(UK)) and applicable law. Our responsibilities under those standards are further described in

the Auditor’s responsibilities for the audit of the financial statements section of our report. We

are independent of the group and parent company in accordance with the ethical requirements

that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical

Standard as applied to listed public interest entities, and we have fulfilled our other ethical

responsibilities in accordance with these requirements. We believe that the audit evidence we

have obtained is sufficient and appropriate to provide a basis for our opinion.

Material uncertainty related to going concern

We draw attention to note 1 in the financial statements, the ability of the Group to meet its

projected expenditure is dependent on these further equity injections and / or the raising of

cash through bank loans or other debt instruments, and/or government grants, and/or loans.

These conditions indicate that a material uncertainty exists that may cast significant doubt over

the Group’s ability to continue as a going concern and therefore their ability to realise their

assets and discharge their liabilities in the normal course of business. Our opinion is not

modified in respect of this matter.

In auditing the financial statements, we have concluded that the director’s use of the going

concern basis of accounting in the preparation of the financial statements is appropriate. Our

evaluation of the directors’ assessment of the group’s and company’s ability to continue to

adopt the going concern basis of accounting included:

• Reviewing the cashflow forecast and budgets for the going concern period being twelve

months from the anticipated date of signing the financial statements and the

corresponding key assumptions and inputs used. This included inflows from capital

fundraises that management anticipate being achieved in the going concern period;

• Discussing with management regarding the future plans of the group;

• Comparing actual results for the year to forecasts to assess management’s forecasting

abilities and the accuracy of its forecasts;

• Challenging management’s key assumptions and inputs of forecast cash receipts from

fundraising and cash outflows in respect of committed costs;

• Testing the arithmetical accuracy of the cashflow forecasts; and,

• Performing a sensitivity analysis on the key assumptions and inputs.

Our responsibilities and the responsibilities of the directors with respect to going concern are

described in the relevant sections of this report.

Our application of materiality

The scope of our audit was influenced by our application of materiality. We set certain

quantitative thresholds for materiality. These, together with qualitative considerations, helped

us to determine the scope of our audit and the nature, timing and extent of our audit procedures

on the individual financial statement line items and disclosures and in evaluating the effect of

misstatements, both individually and in aggregate on the financial statements as a whole.

Based on our professional judgement, we determined the materiality thresholds for the

financial statements as follows:

Group financial

statements

Parent company

financial statements

Material for the

financial statements

as a whole

£55,000 (2023: £58,000) £37,500 (2023: £55,000)

Performance

materiality

£38,500 (2023: £40,600) £26,250 (2023: £38,570)

Basis for materiality

for the financial

statements as a whole

5% (2023: 3%) of the group’s

net assets

3% (2023: 3%) of the parent

company’s net assets

Rationale The group is still in the exploration stage and is not revenue

generating. Net assets are therefore viewed as the key area of

relevance to stakeholders in assessing the financial

performance of the group in its early years of exploration, as the

net asset value is driven by the exploration assets which will

ultimately drive future profitability of the group.

The percentage applied to the benchmark has been selected to

bring into scope all significant classes of transactions, account

balances and disclosures relevant for the members, and also to

ensure that matters that would have a significant impact on the

results were appropriately considered.

Performance materiality has been set at 70% (2023: 70%) of

materiality for the financial statements as a whole, for both the

group and company.

The percentage applied was determined based on our risk

assessment of the control environment and our cumulative

knowledge of the group and company.

We use performance materiality to reduce to an appropriately low level the probability that the

aggregate of uncorrected and undetected misstatements exceeds overall materiality. The audit

of Monte Muambe Mining, Lda, the wholly owned subsidiary, was performed by a component

auditor, with materiality set by us at £45,000 (2023: £26,000). Performance materiality was set

at £31,500 (2023: £18,200). We agreed with the audit committee that we would report to them

misstatements identified during our audit above £2,250 (2023: £1,300) for the group audit and

£1,875 (2023: £2,755) for the company audit, as well as misstatements below those amounts

that, in our view, warranted reporting for qualitative reasons.

Our approach to the audit

The group includes the listed parent company and its subsidiary. We tailored the scope of our

audit to ensure that the planned procedures allowed us to gain sufficient appropriate audit

evidence to be able to give an opinion on the financial statements as a whole, taking into

account the structure of the group and the parent company, the accounting processes, and the

industry in which they operate.

As part of our planning, we assessed the risk of material misstatement including those that

required significant auditor consideration at the component and group level. In particular, we

looked at areas of estimation, for example in respect of the valuation of exploration and

evaluation assets, the valuation of investments in subsidiaries and the matters set out in the

material uncertainty related to going concern paragraph above. We performed procedures to

address the risks identified and for the most significant assessed risks of misstatement, the

procedures performed are outlined below in the key audit matters section of this report.

An audit was performed on the financial information of the group’s significant operating

components which, for the period ended 30 June 2024, were located in the United Kingdom

and Mozambique. The component in Mozambique was audited by a component auditor

operating under our instruction to undertake a full scope audit. We communicated regularly

with the component auditors and we were responsible for the scope and oversight of the audit

process. This, in conjunction with additional procedures performed by us, provided sufficient

appropriate audit evidence for our opinion on the group and parent company financial

statements.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most

significance in our audit of the financial statements of the current period and include the most

significant assessed risks of material misstatement (whether or not due to fraud) we identified,

including those which had the greatest effect on: the overall audit strategy, the allocation of

resources in the audit; and directing the efforts of the engagement team. These matters were

addressed in the context of our audit of the financial statements as a whole, and in forming our

opinion thereon, and we do not provide a separate opinion on these matters.

In addition to the matter described in the Material uncertainty related to going concern section

of our report, we have determined the matters described below to be the key audit matters to

be communicated in our report.

Key Audit Matter How our scope addressed this matter

Valuation of investment in

subsidiary (parent company)

(note 10)

The parent company holds a

material investment in Monte

Muambe Mining, LDA (“MMM”)

as at 30 June 2024 of

£2,051,000, the balance of

which includes loans

reclassified as capital

contributions to its subsidiary.

Given that MMM is loss making

and the exploration and

evaluation assets are the main

assets of the group, there is a

risk that the investment and

intragroup loan balance may

not be recoverable.

Consequently, the valuation of

these balances is considered

to be a key audit matter.

Our work in this area included:

• Obtaining management’s impairment review for all

investments held and challenging the key

assumptions;

• Confirming the ownership of MMM, including

evidence of the additional 31% acquired during the

year;

• Reviewing the accounting and disclosure of the

additional share capital purchased in MMM;

• Ensuring that no impairment indicators exist in

accordance with IAS 36 Impairment of Assets;

• Challenging the judgements and estimates used

by management to assess the recoverability of the

investment including the reclassified intragroup

loans; and

• Considering the recoverability of investments and

intragroup loans by comparing these to underlying

asset values and exploration projects.

Key observations

We found management’s assessment of the valuation of

investments including the reclassified intragroup loans to

be reasonable.

Valuation of exploration and

evaluation assets (note 11)

The group has material

intangible assets of

£1,607,000, being capitalised

exploration costs in respect of

exploration and evaluation

activities in Mozambique.

There is a risk that these

assets have been incorrectly

capitalised in accordance with

IFRS 6 Exploration for and

Evaluation of Mineral

Resources and that there could

be indicators of impairment as

at 30 June 2024.

Management's assessment of

the IFRS 6 indicators of

involves judgement,

particularly in early-stage

exploration projects.

Our audit work included:

• Confirming, through the review of the component

auditor’s files, that the group has good title to the

applicable exploration licence;

• Reviewing the terms and conditions of the

exploration licence;

• Reviewing the component auditor’s work over

capitalised costs including consideration of

appropriateness for capitalisation under IFRS 6;

• Assessing the progress of the project during the

period and post year-end and reviewing forward-

looking exploration budgets;

• Reviewing and challenging management’s

indicator of impairment assessment; and

• Reviewing the JORC Mineral Resource Estimate

and Scoping Study to assess the IFRS 6 indicators

of impairment.

There is a risk that the carrying

value of these intangible

assets are overstated. Given

that exploration and evaluation

assets are subject to

judgement and estimation, this

area is considered to be a key

audit matter.

Key observations

Based on the audit procedures performed, we are

satisfied that management’s assessment of the valuation

of intangible assets is reasonable. However, we draw

attention to the disclosure within notes 11 and 2a, which

state that the group’s existing exploration licence will

expire in May 2025 and that the group has applied for a

mining licence in December 2023.

Should the application not be successful, this may result

in impairment to the carrying value of the exploration and

evaluation assets and to the investment in MMM.

Other information

The other information comprises the information included in the annual report, other than the

financial statements and our auditor’s report thereon. The directors are responsible for the

other information contained within the annual report. Our opinion on the group and parent

company financial statements does not cover the other information and, except to the extent

otherwise explicitly stated in our report, we do not express any form of assurance conclusion

thereon. Our responsibility is to read the other information and, in doing so, consider whether

the other information is materially inconsistent with the financial statements or our knowledge

obtained in the course of the audit, or otherwise appears to be materially misstated. If we

identify such material inconsistencies or apparent material misstatements, we are required to

determine whether this gives rise to a material misstatement in the financial statements

themselves. If, based on the work we have performed, we conclude that there is a material

misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors’ report for the financial

year for which the financial statements are prepared is consistent with the financial

statements; and,

• the strategic report and the directors’ report have been prepared in accordance with

applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their

environment obtained in the course of the audit, we have not identified material misstatements

in the strategic report or the directors’ report.

We have nothing to report in respect of the following matters in relation to which the Companies

Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept by the parent company, or returns

adequate for our audit have not been received from branches not visited by us; or,

• the parent company financial statements and the part of the directors’ remuneration

report to be audited are not in agreement with the accounting records and returns; or,

• certain disclosures of directors’ remuneration specified by law are not made; or,

• we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in Statement of Directors’ Responsibilities, the directors are

responsible for the preparation of the group and parent company financial statements and for

being satisfied that they give a true and fair view, and for such internal control as the directors

determine is necessary to enable the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

In preparing the group and parent company financial statements, the directors are responsible

for assessing the group’s and the parent company’s ability to continue as a going concern,

disclosing, as applicable, matters related to going concern and using the going concern basis

of accounting unless the directors either intend to liquidate the group or the parent company

or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as

a whole are free from material misstatement, whether due to fraud or error, and to issue an

auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance

but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect

a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to

influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We

design procedures in line with our responsibilities, outlined above, to detect material

misstatements in respect of irregularities, including fraud. The extent to which our procedures

are capable of detecting irregularities, including fraud is detailed below:

• We obtained an understanding of the group and parent company and the natural

resources sector to identify laws and regulations that could reasonably be expected to

have a direct effect on the financial statements. We obtained our understanding in this

regard through detailed discussions with management about and potential instances of

non-compliance with laws and regulations both in the UK and in Mozambique. We also

selected a specific audit team based on experience with auditing entities of a similar

size within this industry.

• We determined the principal laws and regulations relevant to the group and parent

company in this regard to be those arising from:

o Listing Rules and Disclosure Guidance and Transparency Rules listing rules

o Quoted Companies Alliance (QCA) Corporate Governance code

o Anti-Bribery and Money Laundering Regulations

o Local industry regulations in Mozambique

o Local tax laws in the UK and Mozambique

• We designed our audit procedures to ensure the audit team considered whether there

were any indications of non-compliance by the group and parent company with those

laws and regulations. These procedures included, but were not limited to: enquiries of

management and discussions with the component auditor, review of board minutes and

a review of legal expenses and review of Regulatory News Services (RNS)

announcements.

• We also identified the risks of material misstatement of the financial statements due to

fraud.

• We considered, in addition to the non-rebuttable presumption of a risk of fraud arising

from management override of controls, that the potential for management bias was

identified in relation to the valuation of investment in a subsidiary and the valuation of

exploration and evaluation assets as described in the Key Audit Matters section above.

We addressed this by challenging the assumptions and judgements made by

management when auditing these significant accounting estimates and ensuring that

there were adequate disclosures included in the respective notes of the financial

statements.

• As in all of our audits, we addressed the risk of fraud arising from management override

of controls by performing audit procedures which included but were not limited to: the

testing of journals; reviewing accounting estimates for evidence of bias; and evaluating

the business rationale of any significant transactions that are unusual or outside the

normal course of business.

• Compliance with laws and regulations at the subsidiary level was ensured through

conducting enquiries of management and reviewing correspondence for any instances

of non-compliance.

Because of the inherent limitations of an audit, there is a risk that we will not detect all

irregularities, including those leading to a material misstatement in the financial statements or

non-compliance with regulation. This risk increases the more that compliance with a law or

regulation is removed from the events and transactions reflected in the financial statements,

as we will be less likely to become aware of instances of non-compliance. The risk is also

greater regarding irregularities occurring due to fraud rather than error, as fraud involves

intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located

on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities.

This

description forms part of our auditor’s report.

Other matters which we are required to address

We were appointed by the directors of Altona Rare Earths plc on 24 June 2021 to audit the

financial statements for the period ending 30 June 2021 and subsequent financial periods. Our

total uninterrupted period of engagement is 4 years, covering the periods ending 30 June 2021

to 30 June 2024.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the

group or the parent company and we remain independent of the group and the parent company

in conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter

3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might

state to the company’s members those matters we are required to state to them in an auditor’s

report and for no other purpose. To the fullest extent permitted by law, we do not accept or

assume responsibility to anyone, other than the company and the company's members as a

body, for our audit work, for this report, or for the opinions we have formed.

Daniel Hutson (Senior Statutory Auditor) 15 Westferry Circus

For and on behalf of PKF Littlejohn LLP Canary Wharf

Statutory Auditor London E14 4HD

30 October 2024

STATEMENT OF CONSOLIDATED PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

For the year ended 30 June 2024

Notes

2024

£’000

2023

£’000

Continuing operations:

Administrative expenses (971) (1,068)

Exploration costs (not capitalised) (102) -

Fundraise costs (72) (48)

Operating loss 5 (1,145) (1,116)

Finance costs 8 (527) (180)

Loss before taxation (1,672) (1,296)

Income tax 9 - -

Loss for the year from continuing operations (1,672) (1,296)

Total loss for the year attributable to:

Owners of Altona Rare Earths Plc (1,618) (1,221)

Non-controlling interests (54) (75)

(1,672) (1,296)

Other comprehensive income

Items that may be reclassified subsequently to profit and loss:

Exchange differences on translation of foreign operations 15 17

(1,657) (1,279)

Total comprehensive loss attributable to:

Owners of Altona Rare Earths Plc (1,606) (1,205)

Non-controlling interests (51) (74)

(1,657) (1,279)

Earnings per share (expressed in pence per share)

- Total Basic and Diluted earnings per share 7 (1.97)p (3.23)p

The accounting policies and notes on pages 62 to 87 form part of these consolidated financial statements.

STATEMENT OF CONSOLIDATED FINANCIAL POSITION

As at 30 June 2024

Notes

2024

£’000

2023

£’000

ASSETS

Non-current assets

Intangible assets 11 1,607 1,290

Tangible assets 12 117 146

Total non-current assets 1,724 1,436

Current assets

Trade and other receivables 13 174 168

Cash and cash equivalents 392 1,130

Total current assets 566 1,298

TOTAL ASSETS 2,290 2,734

LIABILITIES

Non-current liabilities

Loans 15 (322) -

Total non-current liabilities (322) -

Current liabilities

Trade and other payables 14 (585) (593)

Convertible loan notes 14 (362) (256)

Total current liabilities (947) (849)

TOTAL LIABILITIES (1,269) (849)

NET ASSETS 1,021 1,885

EQUITY

Share capital 16 2,283 2,239

Share premium 16 23,072 22,950

Paid in share capital to issue 16 345 -

Share-based payment reserve 17 474 121

Other equity – CLN reserve 12 12

Foreign exchange reserve 29 17

Retained deficit (25,097) (23,360)

1,118 1,979

Non-controlling interest (97) (94)

TOTAL EQUITY 1,021 1,885

The financial statements were approved by the Board and authorised for issue on 30 October 2024

and signed on its behalf by:

Cédric Simonet – Chief Executive

The accounting policies and notes on pages 62 to 87 form part of these consolidated financial statements.

PARENT COMPANY STATEMENT OF FINANCIAL POSITION

COMPANY REGISTRATION NUMBER: 05350512

As at 30 June 2024

Notes

2024

£’000

2023

£’000

ASSETS

Non-current assets

Tangible assets 12 3 4

Investment in subsidiaries 10 2,051 1,633

Total non-current assets 2,054 1,637

Current assets

Trade and other receivables 13 124 106

Cash and cash equivalents 391 1,109

Total current assets 515 1,215

TOTAL ASSETS 2,569 2,852

LIABILITIES

Non-current liabilities

Loans 15 (322) -

Total non-current liabilities (322) -

Current liabilities

Trade and other payables 14 (573) (590)

Convertible loan notes 14 (362) (256)

Total current liabilities (935) (846)

TOTAL LIABILITIES (1,257) (846)

NET ASSETS 1,312 2,006

EQUITY

Share capital 16 2,283 2,239

Share premium 16 23,072 22,950

Paid in share capital to issue 16 345 -

Share-based payment reserve 17 474 121

Other equity – CLN reserve 12 12

Retained deficit (24,874) (23,316)

TOTAL EQUITY 1,312 2,006

The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to

present its individual Company Statement of Comprehensive Income.

The Company’s loss for the year from operations is £1,558,000 (2023: loss of £1,190,000 ).

The financial statements were approved by the Board and authorised for issue on 30 October 2024

and signed on its behalf by:

Cédric Simonet – Chief Executive

The accounting policies and notes on pages 62 to 87 form part of these financial statements.

STATEMENT OF CONSOLIDATED CASH FLOWS

For the year ended 30 June 2024

Notes

2024

£’000

2023

£’000

Cash flows from operating activities

Loss for the year before taxation (1,672) (1,296)

Adjustments for:

Shares/warrants issued for fees and services 487 306

Interest paid and payable 157 65

Depreciation 12 40 24

Foreign exchange movements 15 25

Operating cashflows before movements in

workin

ital

(

973

)

(

876

)

Decrease in trade and other receivables (6) (49)

(Decrease)/increase in trade and other payables (8) 277

(14) 228

Net cash used in operating activities (987) (648)

Cash flows from investing activities

Payment for additional equity in subsidiary 10 (107) (40)

Purchases of property, plant and equipment 12 (11) (3)

Purchases of intangible assets 11 (250) (462)

Net cash used in investing activities (368) (505)

Cash flows from financing activities

Proceeds from issue of shares (paid in not issued) 16 345 2,000

Costs of issue - (207)

Proceeds from convertible loan notes 14 - 275

Costs of convertible loan notes - (28)

Proceeds from loans 15 313 150

Repayment of loans - (150)

Interest paid 14 (41) (40)

Net cash generated from financing activities 617 2,000

Net (decrease)/increase in cash and cash (738) 847

Cash and cash equivalents at beginning of the year 1,130 283

Cash and cash equivalents at the end of the year 392 1,130

Significant non-cash transactions

The significant non-cash transactions were the issue of shares detailed in note 16 and warrants issued

in note 18.

The accounting policies and notes on pages 62 to 87 form part of these financial statements.

PARENT COMPANY STATEMENT OF CASH FLOWS

For the year ended 30 June 2024

Notes

2024

£’000

2023

£’000

Cash flows from operating activities

Loss for the year before taxation (1,558) (1,190)

Adjustments for:

Shares/warrants issued for fees and services 487 306

Interest paid and payable 157 65

Depreciation 12 1 2

Operating cashflows before movements in working

ital

(

913

)

(

817

)

Increase/(decrease) in trade and other receivables 20 (75)

(Decrease)/increase in trade and other payables (17) 278

3 203

Net cash used in operating activities (910) (614)

Cash flows from investing activities

Payment for additional equity in subsidiary 10 (107) (40)

Loans granted to subsidiary undertakings (318) (468)

Receipts of plant, property and equipment 12 - 1

Net cash used in investing activities (425) (507)

Cash flows from financing activities

Proceeds from issue of shares (paid in not issued) 16 345 2,000

Costs of share issue - (207)

Proceeds from convertible loan notes 14 - 275

Costs of convertible loan notes - (28)

Proceeds from loans 15 313 150

Repayment of loans - (150)

Interest paid 14 (41) (40)

Net cash generated from financing activities 617 2,000

Net (decrease)/ increase in cash and cash (718) 879

Cash and cash equivalents at beginning of the year 1,109 230

Cash and cash equivalents at the end of the year 391 1,109

Significant non-cash transactions

The significant non-cash transactions were the issue of shares detailed in note 16 and warrants issued

in note 18.

The accounting policies and notes on pages 62 to 87 form part of these financial statements

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 June 2024

Share capital

premium

Paid in share

capital to be

issued

Foreign

exchange

reserve

Share-based

payment

reserve

CLN Issue

Retained

deficit

NCI

Total equity

£’000

Balance at 30 June 2022

1,790

21,404

(22,139)

(20)

1,050

Comprehensive income

Loss for the year

(1,221)

(75)

(1,296)

Currency translation

NCI share in translation

difference

(1)

Total comprehensive income

(1,221)

(74)

(1,279)

Transactions with owners

recognised directly in equity

Issue of shares

449

1,797

2,246

Cost of shares issued

(251)

(210)

Share-based payments

CLN Issue

Total transactions with owners

recognised directly in equity

449

1,546

107

2,114

Balance at 30 June 2023

2,239

22,950

121

(23,360)

(94)

1,885

Comprehensive income

Loss for the year

(1,618)

(54)

(1,672)

Currency translation

Total comprehensive income

(1,618)

(51)

(1,657)

Transactions with owners

recognised directly in equity

Issue of shares

122

166

Shares to be issued

345

Share-based payments

353

Additional transactions with NCI

(119)

(70)

Total transactions with owners

recognised directly in equity

122

345

353

(119)

793

Balance at 30 June 2024

2,283

23,072

345

474

(25,097)

(97)

1,021

PARENT COMPANY STATEMENT OF CHANGES IN EQUITY

For the year ended 30 June 2024

Share capital

premium

Paid in Share

capital to be

issued

Share-based

payment

reserve

CLN Reserve

Retained deficit

Total equity

£’000

Balance at 30 June 2022

1,790

21,404

(22,126)

1,082

Comprehensive income

Loss for the year

(1,190)

Total comprehensive income

(1,190)

Transactions with owners

recognised directly in equity

Issue of shares

449

1,797

2,246

Cost of shares issued

(251)

(210)

Share-based payments

CLN Issue

Total transactions with owners

recognised directly in equity

449

1,546

107

2,114

Balance at 30 June 2023

2,239

22,950

121

(23,316)

2,006

Comprehensive income

Loss for the year

(1,558)

Total comprehensive income

(1,558)

Transactions with owners

recognised directly in equity

Issue of shares

122

166

Shares to be issued

345

Share-based payments

353

Total transactions with owners

recognised directly in equity

122

345

353

864

Balance at 30 June 2024

2,283

23,072

345

474

(24,874)

1,312

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. ACCOUNTING POLICIES

GENERAL INFORMATION

Altona Rare Earths Plc (the “Company”) is a publicly listed company incorporated and domiciled

in England & Wales. Its registered offices are at Eccleston Yards, 25 Eccleston Place, London

SW1W 9NF.

On 9 June 2023, the Company announced the admission of the Company’s entire issued share

capital to the Official List of the Financial Conduct Authority by way of a Standard Listing under

Chapter 14 of the Listing Rules and to trading on the London Stock Exchange's Main Market for

listed securities ("Admission"). The Company’s shares are listed under the new ticker “REE”.

From 29 July 2024, this two tier system was replaced and the Company is now in the “Equity

Shares - Transition” category.

The Company’s principal activity is focused on the discovery and development of Critical Raw

Materials mining projects in Africa.

BASIS OF PREPARATION

The consolidated financial statements have been prepared in accordance with UK-adopted

international accounting standards and the requirements of the Companies Act 2006. The

principal accounting policies are summarised below. They have been applied consistently

throughout the year. The financial statements have been prepared on the historical cost basis,

except for the assets acquisition which was measured at fair value.

The functional currency for each entity in the Group is determined as the currency of the

primary economic environment in which it operates. The functional currency of the parent

company is Pounds Sterling (£) as this is the currency that finance is raised in. The functional

currency of its main subsidiary is Mozambique Meticals (MTN) as this is the currency that mainly

influences labour, material and other costs of providing services. The Group has chosen to

present its consolidated financial statements in Pounds Sterling (£), as the Directors believe it

is the most relevant presentational currency for users of the consolidated financial statements.

All values are rounded to the nearest thousand pounds (£’000) unless otherwise stated. Foreign

operations are included in accordance with the policies set out below.

The preparation of financial statements requires the use of certain critical accounting estimates.

It also requires management to exercise its judgement in the process of applying the Group’s

accounting policies. The areas involving a higher degree of judgement or complexity, or areas

where assumptions and estimates are significant to the financial information are disclosed in

Note 2.

GOING CONCERN

The Group and Company raise money for exploration and capital projects as and when required.

There can be no assurance that the Group and/or Company’s projects will be fully developed in

accordance with current plans or completed on time or to budget. Future work on the

development of these projects, the levels of production and financial returns arising therefrom,

may be adversely affected by factors outside the control of the Group or Company.

An operating loss is expected in the 12 months subsequent to the date of these financial

statements. As a result the Group and Company will need to raise funding to provide additional

working capital within the next 12 months. The ability of the Group and Company to meet its

projected expenditure is dependent on these further equity injections and / or the raising of

cash through bank loans or other debt instruments/and or government grants and/or loans.

These conditions necessarily indicate that a material uncertainty exists that may cast significant

doubt over the Group and Company’s ability to continue as a going concern and therefore their

ability to realise their assets and discharge their liabilities in the normal course of business.

Whilst acknowledging this material uncertainty, the Directors remain confident of raising

finance and therefore, the Directors consider it appropriate to prepare the consolidated and

parent company financial statements on a going concern basis. The consolidated and parent

company financial statements do not include the adjustments that would result if the Group and

Company were unable to continue as a going concern.

The Auditors have made reference to going concern by way of a material uncertainty within the

financial statements.

NEW STANDARDS AND INTERPRETATIONS

a) New standards, amendments and interpretations adopted by the Group.

There were no new or amended accounting standards that required the Group to change its

accounting policies for the year ended 30 June 2024 and no new standards, amendments or

interpretations were adopted by the Group.

b) New standards, amendments and interpretations not yet adopted by the Group.

The standards and interpretations that are relevant to the Group, issued, but not yet effective,

up to the date of the Financial Statements are listed below. The Group intends to adopt these

standards, if applicable, when they become effective.

Standard	Impact on initial application	Effective date
Amendments to IAS 1 -
Classification of Liabilities
as current or non- current
	Clarifies that the classification of liabilities as
	current or noncurrent should be based on rights
	that exist at the end of the reporting period.

		Annual periods
		beginning on or after
		1 January 2024
Amendments to IAS 1 –
Noncurrent Liabilities with
Covenants
	Clarifies that only those covenants with which
	an entity must comply on or before the end of
	the reporting period affect the classification of a
	liability as current or non-current.

		Annual periods
		beginning on or after
		1 January 2024
Amendments to IFRS 16 –
Lease Liability in a Sale and
Leaseback 4
	Specifies requirements relating to measuring the
	lease liability in a sale and leaseback transaction
	after the date of the transaction.
		Annual periods
		beginning on or after
		1 January 2024
Amendments to IAS 7 and
IFRS 7 –
Supplier Finance
Arrangements 4 5
	Requires an entity to provide additional
	disclosures about its supplier finance
	arrangements.
		Annual periods
		beginning on or after
		1 January 2024
IAS 8 Accounting Policies -
Changes in Accounting
Estimates and Errors
	Requires disclosure of any new standards and
	interpretations that have been issued but are
	not yet effective and have not yet been applied
	in the financial statements, together with
	information relevant to assessing the possible
	impact when implemented for the first time.

		Unknown

The Directors have evaluated the impact of transition to the above standards and do not

consider that there will be a material impact of transition on the financial statements.

BASIS OF CONSOLIDATION

The consolidated financial statements incorporate the financial statements of the Company and

entities controlled by the Company (its subsidiaries) made up to 30 June each year. Per IFRS 10,

control is achieved when the Company:

• has the power over the investee;

• is exposed, or has rights, to variable returns from its involvement with the investee; and

• has the ability to use its power to affects its returns.

The Company reassesses whether or not it controls an investee if facts and circumstances

indicate that there are changes to one or more of the three elements of control listed above.

When the Company has less than a majority of the voting rights of an investee, it considers that

it has power over the investee when the voting rights are sufficient to give it the practical ability

to direct the relevant activities of the investee unilaterally. The Company considers all relevant

facts and circumstances in assessing whether or not the Company’s voting rights in an investee

are sufficient to give it power, including:

• the size of the Company’s holding of voting rights relative to the size and dispersion of

holdings of the other vote holders;

• potential voting rights held by the Company, other vote holders or other parties;

• rights arising from other contractual arrangements; and

• any additional facts and circumstances that indicate that the Company has, or does not

have, the current ability to direct the relevant activities at the time that decisions

need to be made, including voting patterns at previous shareholders’ meetings.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and

ceases when the Company loses control of the subsidiary. Specifically, the results of subsidiaries

acquired or disposed of during the year are included in profit or loss from the date the Company

gains control until the date when the Company ceases to control the subsidiary. Where

necessary, adjustments are made to the financial statements of subsidiaries to bring the

accounting policies used into line with the Group’s accounting policies.

Inter-company transactions, balances and unrealised gains on transactions between group

companies are eliminated. Unrealised losses are also eliminated. When necessary, amounts

reported by subsidiaries have been adjusted to conform with the group’s accounting policies.

The Group recognises any non-controlling interest in the acquired entity at the non-controlling

interest’s proportionate share of the acquired entity’s net identifiable assets. Subsequent to

acquisition, the carrying amount of non-controlling interests is the amount of those interests at

initial recognition plus the non-controlling interests’ share of subsequent changes in equity. The

Group treats transactions with non-controlling interests that do not result in a loss of control as

transactions with equity owners of the group. A change in ownership interest results in an

adjustment between the carrying amounts of the controlling and non-controlling interests to

reflect their relative interests in the subsidiary.

Profit or loss and each component of other comprehensive income are attributed to the owners

of the Company and to the non-controlling interests. Total comprehensive income of the

subsidiaries is attributed to the owners of the Company and to the non-controlling interests

even if this results in the non-controlling interests having a

deficit balance.

Asset Acquisitions

Acquisitions of mineral exploration licences through the acquisition of non-operational

corporate structures that do not represent a business, and therefore do not meet the definition

of a business combination, are accounted for as the acquisition of an asset.

Where an acquisition transaction constitutes the acquisition of an asset and not a business, the

consideration paid is allocated to assets and liabilities acquired based on their relative fair

values, with transaction costs capitalised. No gain or loss is recognised. Consideration paid in

the form of equity instruments is measured by reference to the fair value of the asset acquired.

The fair value of the assets acquired would be measured at the point control is obtained. The

Group recognises the fair value of contingent consideration in respect to an asset acquisition,

where it is probable that a liability has been incurred, and the amount of that liability can be

reasonably estimated. Such contingent consideration is recognised at the time control of the

underlying asset is obtained, and such an amount is included in the initial measurement of the

cost of the acquired assets.

FOREIGN CURRENCIES AND FOREIGN EXCHANGE RESERVE

In preparing the financial statements of the Group entities, transactions in currencies other than

the entity’s functional currency (foreign currencies) are recognised at the rates of exchange

prevailing on the dates of the transactions. At each reporting date, monetary assets and

liabilities that are denominated in foreign currencies are retranslated at the rates prevailing at

that date. Non-monetary items carried at fair value that are denominated in foreign currencies

are translated at the rates prevailing at the date when the fair value was determined. Non-

monetary items that are measured in terms of historical cost in a foreign currency are not

retranslated.

Exchange differences are recognised in profit or loss in the period in which they arise except

for:

• exchange differences on foreign currency borrowings relating to assets under construction

for future productive use, which are included in the cost of those assets when they are

regarded as an adjustment to interest costs on those foreign currency borrowings;

• exchange differences on transactions entered into to hedge certain foreign currency risks

(see below under financial instruments/hedge accounting); and

• exchange differences on monetary items receivable from or payable to a foreign operation

for which settlement is neither planned nor likely to occur in the foreseeable future

(therefore forming part of the net investment in the foreign operation), which are

recognised initially in other comprehensive income and reclassified from equity to profit or

loss on disposal or partial disposal of the net investment.

For the purpose of presenting consolidated financial statements, the assets and liabilities of the

Group’s foreign operations are translated at exchange rates prevailing on the reporting date.

Income and expense items are translated at the average exchange rates for the period, unless

exchange rates fluctuate significantly during that period, in which case the exchange rates at

the date of transactions are used. Exchange differences arising, if any, are recognised in other

comprehensive income and accumulated in a foreign exchange translation reserve (attributed

to non-controlling interests as appropriate).

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as

assets and liabilities of the foreign entity and translated at the closing rate. Exchange differences

arising are recognised in other comprehensive income.

SEGMENTAL REPORTING

Operating segments are reported in a manner consistent with the internal reporting provided

to the chief decision-maker. The chief decision-maker has been identified as the Executive

Board, at which level strategic decisions are made.

An operating segment is a component of the Group:

• That engages in business activities from which it may earn revenues and earn expenses,

• Whose operating results are regularly reviewed by the entity’s chief operating decision-

maker to make decisions about resources to be allocated to the segment and assess its

performance, and

• For which discrete financial information is available.

TAXATION

Current income tax assets and liabilities for the current period are measured at the amount

expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws

used to compute the amount are those that are enacted or substantively enacted, at the

reporting date, in the countries where the Group operates.

Deferred tax is accounted for using the liability method in respect of temporary differences

arising from differences between the carrying amount of assets and liabilities in the Financial

Statements and the corresponding tax bases used in the computation of taxable profit or loss.

In principle, deferred tax liabilities are recognised for all taxable temporary differences and

deferred tax assets are recognised to the extent that it is probable that taxable profits will be

available against which deductible temporary differences can be utilised.

The Group has losses to be carried forward on which no deferred tax asset is recognised due to

the uncertainty as to the timing of profit.

INTANGIBLE ASSETS - EXPLORATION AND EVALUATION ASSETS

Exploration and evaluation expenditure for each area of interest, other than that acquired from

another entity, is charged to the consolidated statement of income as incurred, except when

the Group has obtained the legal right to explore a specific area of interest. Once the right to

explore is secured, expenditure is capitalised if it meets certain criteria and is expected to be

recovered through successful development or sale of the area. Costs that are considered

appropriate to capitalise include:

- Directly Attributable Costs: This includes acquisition costs, geological and geophysical studies,

exploratory drilling, and any other expenditure directly related to evaluating the technical

feasibility and commercial viability of the resource.

- Ongoing Active Operations: If significant exploration and evaluation activities are planned

and continue, and the expenditure is expected to lead to commercially recoverable reserves,

the Group capitalises the costs.

If at the reporting period's end, the exploration has not yet reached a stage where the existence

of commercially recoverable reserves can be reasonably assessed, the expenditure remains

capitalised.

Purchased exploration and evaluation assets are recognised at their fair value at acquisition. As

the capitalised exploration and evaluation expenditure asset is not available for use, it is not

depreciated. However, the capitalised amounts are subject to regular impairment assessments

to ensure that their carrying value does not exceed their recoverable amount.

This assessment is carried out by allocating exploration and evaluation assets to cash generating

units, which are based on specific projects or geographical areas. IFRS 6 permits impairments of

exploration and evaluation expenditure to be reversed should the conditions which led to the

impairment improve. The Group continually monitors the position of the projects capitalised

and impaired. (See note 2a for further comments on the evaluation of the recoverability of these

assets).

Whenever the exploration for and evaluation of mineral resources in cash generating units does

not lead to the discovery of commercially viable quantities of mineral resources and the Group

has decided to discontinue such activities of that unit, the associated expenditures are written

off to the Income Statement.

PROPERTY, PLANT AND EQUIPMENT

Property, plant, and equipment are stated at cost, less accumulated depreciation, and any

provision for impairment losses. The asset’s residual values, useful lives and methods of

depreciation /amortisation are reviewed at each reporting period and adjusted prospectively,

if appropriate.

Depreciation is charged on each part of an item of property, plant, and equipment to write off

the cost of assets less the residual value over their estimated useful lives, using the straight–

line method. Depreciation is charged to the income statement. The estimated useful lives are

as follows:

Buildings/Constructions – 25 years

Heavy machinery and equipment – 8 years

Precision machinery, computer and printers – 4 years

Vehicles – 4 years

FINANCIAL INSTRUMENTS

Financial assets

Classification

The Group’s financial assets consist of financial assets held at amortised cost. The classification

depends on the purpose for which the financial assets were acquired. Management determines

the classification of its financial assets at initial recognition.

Financial assets held at amortised cost

Assets that are held for collection of contractual cash flows, where those cash flows represent

solely payments of principal and interest, are measured at amortised cost. Any gain or loss

arising on derecognition is recognised directly in the profit or loss and presented in other gains/

(losses) together with foreign exchange gains and losses. Impairment losses are presented as a

separate line item in the statement of profit or loss.

They are included in current assets, except for maturities greater than 12 months after the

reporting date, which are classified as non-current assets. The Group’s financial assets at

amortised cost comprise trade and other receivables and cash and cash equivalents at the year

end.

Recognition and measurement

Regular purchases and sales of financial assets are recognised on the trade date – the date on

which the Group commits to purchasing or selling the asset. Financial assets are initially

measured at fair value plus transaction costs. Financial assets are de-recognised when the

rights to receive cash flows from the assets have expired or have been transferred, and the

Group has transferred substantially all of the risks and rewards of ownership.

Financial assets are subsequently carried at amortised cost using the effective interest method.

Other receivables are recognised initially at the amount of consideration that is unconditional,

unless they contain significant financing components when they are recognised at fair value.

The other receivables in the accounts do not contain significant financing components.

Impairment of financial assets

The Group assesses, on a forward-looking basis, the expected credit losses associated with its

financial assets carried at amortised cost. For trade and other receivable due within 12 months

the Group applies the simplified approach permitted by IFRS 9. Therefore, the Group does not

track changes in credit risk, but rather recognises a loss allowance based on the financial asset’s

lifetime expected credit losses at each reporting date.

A financial asset is impaired if there is objective evidence of impairment as a result of one or

more events that occurred after the initial recognition of the asset, and that loss event(s) had

an impact on the estimated future cash flows of that asset that can be estimated reliably. The

Group assesses at the end of each reporting period whether there is objective evidence that a

financial asset, or a group of financial assets, is impaired.

The criteria that the Group uses to determine that there is objective evidence of an impairment

loss include:

• Significant financial difficulty of the issuer or obligor;

• A breach of contract, such as a default or delinquency in interest or principal

repayments;

• The Group, for economic or legal reasons relating the borrower’s financial difficulty,

granting the borrower a concession that the lender would not otherwise consider;

• It becomes probable that the borrower will enter bankruptcy or other financial

reorganisation.

The Group first assesses whether objective evidence of impairment exists.

The amount of the loss is measured as the difference between the asset’s carrying amount and

the present value of estimated future cash flow (excluding future credit losses that have not

been incurred), discounted at the financial asset’s original effective interest rate. The asset’s

carrying amount is reduced and the loss is recognised in profit or loss.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can

be related objectively to an event occurring after the impairment was recognised (such as an

improvement in the debtor’s credit rating), the reversal of the previously recognised

impairment loss is recognised in profit or loss.

Financial liabilities at amortised cost

Trade payables are obligations to pay for goods or services that have been acquired in the

ordinary course of business from suppliers. Accounts payable are classified as current liabilities

if payment is due within one year or less. If not, they are presented as non-current liabilities.

Trade payables are recognised initially at fair value, and subsequently measured at amortised

cost using the effective interest method.

Other financial liabilities are initially measured at fair value. They are subsequently measured

at amortised cost using the effective interest method.

Financial liabilities are de-recognised when the Group’s contractual obligations expire or are

discharged or cancelled.

INVESTMENTS IN SUBSIDIARIES

The Company recognises its investments in subsidiaries at cost, less any provision for

impairment. Capital contributions are measured at their value on the date on which the

Company makes the contribution. The Company assesses the impairment of each subsidiary

against the total cost (both acquisition costs and capital contributions) made.

BORROWINGS

For convertible loan notes (CLNs), the liability portion of the CLN is determined using a market

interest rate for an equivalent non-convertible bond. This amount is recorded as a liability on

an amortised cost basis until extinguished on conversion or maturity of the loan notes. The

remainder of the proceeds is allocated to the equity component, which represents the

conversion option. This is recognised and included in shareholders’ equity, under the

convertible loan notes reserve (“CLN Reserve”), net of any income tax effects,

In cases where the convertible loan notes contain embedded derivatives the treatment differs.

IFRS 9 requires that the embedded derivative be separated from the host contract if it meets

certain criteria, including that the economic characteristics and risks of the embedded

derivative are not closely related to those of the host. The embedded derivative is then

measured at fair value through profit or loss (FVTPL), with changes in its value recognised in the

income statement. The host liability, after separating the embedded derivative, is still measured

at amortised cost unless designated otherwise.

Borrowings are removed from the balance sheet when the obligation specified in the contract

is discharged, cancelled or expired. The difference between the carrying amount of a financial

liability that has been extinguished or transferred to another party and the consideration paid,

including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as

other income or finance costs.

Borrowings are classified as current liabilities unless the company has an unconditional right to

defer settlement of the liability for at least 12 months after the reporting period.

EQUITY INSTRUMENTS

An equity instrument is any contract that evidences a residual interest in the assets of a

Company after deducting all of its liabilities. Equity instruments issued are recorded at the

proceeds received net of direct issue costs.

Share capital represents the amount subscribed for shares at nominal value.

The share premium account represents premiums received on the initial issuing of the share

capital. Any transaction costs associated with the issuing of shares are deducted from share

premium, net of any related income tax benefits.

The share-based payments reserve represents equity-settled shared-based employee

remuneration for the fair value of the warrants issued. It also includes the warrants issued for

services rendered accounted for in accordance with IFRS 2.

The Convertible Loan Note "CLN” reserve represents the value of the conversion portion of the

CLN, calculated as the proceeds, less amortised cost, less fair value.

The foreign exchange translation reserve arises from the translation of the Group’s foreign

operations at each year end. The assets and liabilities of these operations are translated at

exchange rates prevailing on the reporting date and differences, if any, are recognised in this

reserve.

Retained deficit include all current and prior period results as disclosed in the Statement of

Comprehensive Income, less dividends paid to the owners of the Company.

The Non-Controlling Interest reserve shows the share of equity that belongs to others besides

the parent company.

SHARE BASED PAYMENTS

The Company issues equity-settled share-based payments to certain employees. Equity-settled

share-based payments are measured at fair value at the date of grant. The equity-settled share-

based payments are expensed to profit or loss or capitalised to investments or intangibles in

the statement of financial position over a straight line basis over the vesting period based on

the Company’s estimate of shares that will eventually vest. A corresponding entry is then made

in the share-based payment reserve.

The fair value of these share-based payments is determined using Black-Scholes option pricing

models and the assumptions are included in note 17 to the financial statements.

The Group has two types of share-based payments other than employee compensation.

Warrants issued for services rendered which are accounted for in accordance with IFRS 2

recognising either the costs of the service if it can be reliably measured or the fair value of the

warrant (using Black-Scholes option pricing models – see note 17).

Warrants issued as part of share issues have been determined as equity instruments under IAS

32. Since the fair value of the shares issued at the same time is equal to the price paid, these

warrants, by deduction, are considered to have been issued at nil value.

EARNINGS PER SHARE

Basic earnings per share is calculated by dividing:

- the profit or loss attributable to the owners of the company, excluding any costs of

servicing equity other than ordinary shares

- by the weighted average number of ordinary shares outstanding during the financial

year

Diluted earnings per share adjusts the figures used in the determination of basic earnings per

share to take into account:

- after income tax effect of interest and other financing costs associated with dilutive

potential ordinary shares, and

- weighted average number of ordinary shares that would have been outstanding

assuming the conversion of all dilutive potential ordinary shares.

2. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In applying the Group’s accounting policies, which are described in note 1, the Directors are

required to make judgements (other than those involving estimations) that have a significant

impact on the amounts recognised and to make estimates and assumptions about the carrying

amounts of assets and liabilities that are not readily apparent from other sources. The estimates

and associated assumptions are based on historical experience and other factors that are

considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to

accounting estimates are recognised in the period in which the estimate is revised if the revision

affects only that period, or in the period of the revision and future periods if the revision affects

both current and future periods.

a) Critical judgement in the recoverability of exploration and evaluation assets (see note 11)

Exploration and evaluation assets include mineral rights and exploration and evaluation costs,

including geophysical, topographical, geological and similar types of costs. Exploration and

evaluation costs are capitalised if management concludes that future economic benefits are

likely to be realised and determines that economically viable extraction operation can be

established as a result of exploration activities and internal assessment of mineral resources.

According to ‘IFRS 6 Exploration for and evaluation of mineral resources’, the potential

indicators of impairment include: management’s plans to discontinue the exploration

activities, lack of further substantial exploration expenditure planned, expiry of exploration

licences in the period or in the nearest future, or existence of other data indicating the

expenditure capitalised is not recoverable. At the end of each reporting period, management

assesses whether such indicators exist for the exploration and evaluation assets capitalised,

which requires significant judgement. The current exploration projects are actively being

progressed and therefore the Company does not believe any circumstances have arisen to

indicate these assets require impairment.

b) Critical estimate in accounting for share-based payments (see note 17)

The Group has issued various warrants to its service providers. These are valued in accordance

with IFRS 2 “Share-based payments”. The grant date fair value of such share-based payments

is calculated using a Black-Scholes model whose input assumptions are derived from market

and other internal estimates.

These are set out in note 17 to the accounts. Changes to these

inputs may impact the related charge.

c) Critical judgement in the recoverability of VAT (see note 13)

At 30 June 2024, the Group recognised an amount of £91,000 (2023: £80,000) within other

receivables which relates to VAT receivable from the Mozambique government. This includes

a provision for 23% for non-recoverability. New legalisation in Mozambique has provided a path

for companies operating in the mining sector to seek reimbursement of VAT prior to the

production stage. Therefore, the Directors believe that this amount (including a 23% provision)

will be recovered.

d) Company only - Critical judgement in the impairment assessment of investment in

subsidiaries (see notes 10)

In preparing the parent company financial statements, the Directors apply their judgement to

decide if any or all of the Company’s investments (including capital contributions) in its

subsidiaries should be impaired.

In undertaking their review, the Directors consider the outcome of their impairment assessment

of the exploration and evaluation assets as noted above.

In view of the Maiden Resource Estimate published in September 2023, which shows the

existence of substantial resources at the property, the Directors do not believe an impairment is

appropriate in relation to the investments in this subsidiary.

3. FINANCIAL INSTRUMENTS – RISK MANAGEMENT

The financial instruments were categorised as follows:

	Group		Company
	2024
	£’000
		2023
		£’000
			2024
			£’000
				2023
				£’000
Financial assets measured at
amortised cost:

Trade and other receivables (note 13)	128	154	88	68
Cash and cash equivalents	392	1,130	391	1,109

	520	1,284	479	1,177
Financial liabilities measured at
amortised cost:

Trade and other payables (note 14)	138	440	126	437
Convertible loan notes and loans (note
14 and 15)

	684

		256

			684

				256
	822	696	810	693

The Group’s financial instruments comprise cash and sundry receivables (all of which are carried

at amortised cost) and payables that arise directly from its operations.

The main risks arising from financial instruments are credit risk, liquidity risk and currency risk.

The Directors review and agree policies for managing these risks and these are summarised

below. There have been no substantial changes to the Group’s exposure to financial instrument

risks, its objectives, policies and processes for managing those risks or the methods used to

measure them from previous periods unless otherwise stated in this note.

There is no significant difference between the carrying value and fair value of receivables, cash

and cash equivalents and payables.

Credit risk

Credit risk refers to the risk that a counter party will default on its contractual obligations

resulting in financial loss. The Company has adopted a policy of only dealing with creditworthy

counterparties, as assessed by the Directors using relevant available information. Credit risk

also arises on cash and cash equivalents and deposits with banks and financial institutions. The

Company’s cash deposits are only held in banks and financial institutions which are

independently rated with a minimum credit agency rating of B. At year end 99% (2023: 98%) of

the Group’s cash was held in the UK at HSBC (credit rating AA-) and 1% (2023: 2%) was held in

Mozambique at the Millennium Bank (credit rating B). There were no bad debts recognised

during the year and there is no provision required at the reporting date nor any linked IFRS 9

disclosures. The balances are not material at year end and therefore no sensitivity analysis has

been performed.

Liquidity risk

Liquidity risk arises from the management of working capital. It is the risk that the Group will

encounter difficulty in meeting its financial obligations as they fall due. Short term payables are

classified as those payables that are due within 30 days. The Group’s policy is to ensure that it

will always have sufficient cash to allow it to meet its liabilities when they become due. To

achieve this aim, it seeks to maintain liquid cash balances (or agreed facilities) to meet expected

requirements for a period of at least 45 days. The undiscounted maturity analysis is shown

below.

Financial liabilities	Less than 1 year	1-2 years	Total
	£’000	£’000	£’000
Trade and other payables	585	-	585
Borrowings	362	322	684
	947	322	1,269

Funding risk

Funding risk is the possibility that the Group might not have access to the financing it needs.

The Group’s continued future operations depend on the ability to raise sufficient working

capital through the issue of equity share capital. The Directors are confident that adequate

funding will be forthcoming with which to finance operations. The Directors have a strong track

record of raising funds as required. Controls over expenditure are carefully managed and

activities planned to ensure that the Group has sufficient funding.

Foreign currency risk

Foreign currency risk is the risk that fair value or future cash flows of a financial instrument will

fluctuate because of changes in foreign exchange rates. The Group reports in Pounds Sterling,

but the functional currency of its subsidiary is the Mozambique Meticals (MTN). The Group

does not currently hedge its exposure to other currencies. The Group’s cash and cash

equivalents are held in Pounds Sterling and MTN. At 30 June 2024, less than 1% (2023: 2%) of

the Group’s cash and cash equivalent were held in MTN. The balances are not material at year

end and therefore no sensitivity analysis has been performed.

Interest rate risk

The Group finance operations through the issue of equity share capital. The Group manages

the interest rate risk associated with the Group’s cash assets by ensuring that interest rates are

as favourable as possible, whether this is through investment in floating or fixed interest rate

deposits, whilst managing the access the Group requires to the funds for working capital

purposes. At the reporting date, cash at bank floating interest rate is not subject to any interest

receivable. The Group has not performed a sensitivity analysis in relation to the interest rate

movements on financial assets as this is not considered to be material.

Capital Management

The Group considers its capital to comprise its ordinary share capital, share premium and

accumulated retained losses. The Group’s objective when maintaining capital is to safeguard

the entity's ability to continue as a going concern, so that it can provide returns for shareholders

and benefits for other stakeholders.

The Group meets its capital needs by equity financing. The Group sets the amount of capital it

requires to fund the Group’s project evaluation costs and administration expenses. The Group

manages its capital structure and makes adjustments to it in the light of changes in economic

conditions and the risk characteristics of the underlying assets. The Group do not have any

derivative instruments or hedging instruments. It has been determined that a sensitivity

analysis will not be representative of the Group’s position in relation to market risk and

therefore, such an analysis has not been undertaken.

4. SEGMENTAL INFORMATION

For the purpose of IFRS 8, the Chief Operating Decision Maker “CODM” takes the form of the

Board of Directors. The directors are of the opinion that the business of the Group focused on

three reportable segments as follows:

• Head office, corporate and administrative, including parent company activities of raising

finance and seeking new investment and exploration opportunities, all based in the UK;

• Mineral exploration, all based in Mozambique, and

• Other costs, mostly administrative activities, based in Mauritius and Africa.

The geographical information is the same as the operational segmental information shown

below.

Year ended 30 June 2024	Corporate and
	Administrative
	(UK)


		Other
			Mineral
			exploration
			(Mozambique)


				Total
	£’000	£’000	£’000	£’000

Operating loss before and
after taxation	(1,557)	(30)


			(85)	(1,672)

Segment total assets (net of
investments in subsidiaries)	726	16

			1,548	2,290

Segment liabilities	(1,256)	(2)	(11)	(1,269)

Year ended 30 June 2023	Corporate and
	Administrative
	(UK)

		Other

			Mineral
			exploration
			(Mozambique)


				Total
	£’000	£’000	£’000	£’000

Operating loss before and
after taxation	1,190	12


			94	1,296

Segment total assets (net
of investments in
subsidiaries)	1,324	-


			1,410	2,734

Segment liabilities	(846)	-	(3)	(849)

5. EXPENSES BY NATURE

	2024
	£’000
		2023
		£’000

Exploration expenditure (not capitalised)	102	-
Fees payable to the Company’s Auditor and its associates in
relation to the audit of the parent company and consolidated
financial statements
	55


		53
Fees payable to the Company’s Auditor and its associates in
relation to the audit of the Company’s subsidiaries	10	5
Fees payable to the Company’s Auditor for other services:
Reporting Accountant services in respect to the Fundraise
	48	8
Legal and professional fees
	220	259
Depreciation
	40	24
Listing costs
	72	48
Wages and salaries	429	437
Insurance costs	37	37
Regulatory fees	81	17
Other	51	228
	1,145	1,116

Exploration expenditure mainly comprises of amounts relating to pre-licence due diligence

costs that have not yet resulted in the securing of licences. In line with IFRS 6, costs incurred

before the legal right to explore a specific area is obtained must be expensed as they do not

meet the criteria for capitalisation. IFRS 6 specifically excludes the capitalisation of any costs

incurred prior to obtaining these exploration rights, which means such pre-right to explore

costs are required to be immediately recognised as an expense in the income statement.

6. STAFF COSTS (INCLUDING DIRECTORS)

	2024
	£’000
		2023
		£’000

Salaries and fees	475	490
Pensions	1	1
Social security costs	14	27
Total staff costs	490	518
Amounts capitalised in intangibles	(61)	(81)
	429	437

The average monthly number of employees (both permanent and temporary) during the year

ended 30 June 2024 was 11 (2023: 17 employees) and is shown in the table below. The costs

of the wages and salaries in MMM have been capitalised as part of the cost of exploration

assets additions in the year.

Key management and personnel are considered to be the Directors.

	2024	2023
Management	3	3
Technical	7	10

Administration	1	4
	11	17

7. EARNINGS PER SHARE

The basic earnings per share is derived by dividing the loss for the period attributable to

ordinary shareholders by the weighted average number of shares in issue.

	2024	2023

Loss for the year (£’000)	(1,672)	(1,296)
Weighted average number of shares – expressed in thousands	84,936	40,069
Basic earnings per share – expressed in pence
	(1.97p)	(3.23p)

As the inclusion of the potential ordinary shares would result in a decrease in the loss per

share they are considered to be anti-dilutive and, as such, the diluted loss per share calculation

is the same as the basic loss per share.

On 19 July 2024 an additional 76,248,759 Ordinary Shares were issued, increasing the

weighted average number of shares to 158,809,034.

8. FINANCE COSTS

	2024	2023
	£’000	£’000

Interest payable on the CLNs (note 14)	77	25
Share-based payment (warrant cost) of loans (note 17)	353	62
Shares issued for loan extension	-	50
Interest payable on loans (note 15)
	79	40
Foreign exchange/other interest
	18	3

	527	180

9. INCOME TAX

The income and deferred tax charge for the year was £nil (2023:£nil) due to the losses incurred.

The tax on the Group’s loss before tax differs from the theoretical amount that would arise

using the weighted average tax rate applicable to the losses of the consolidated entities as

follows:

GROUP	2024	2023
	£’000	£’000

Loss before tax	(1,672)	(1,296)
Tax at the applicable rate of 30.1% (2023:24%)	(495)	(313)
Expenses not deductible for tax purposes	112	73
Tax losses for which no deferred tax is recognised	383	240
Total tax charge	-	-

The weighted average applicable tax rate of 30.1% (2023: 24%) used is a combination of the

25% (2023: 19%) standard rate of corporation tax in the UK and 31% Mozambique corporation

tax.

The Group has total tax losses of £36,129,000 to carry forward against future profits (2023:

£34,581,000 losses brought forward). No deferred tax asset on losses carried forward has

been recognised on the grounds of uncertainty as to when profits will be generated against

which to relieve said amount.

10. INVESTMENT IN SUBSIDIARIES

COMPANY	2024	2023
	£’000	£’000
Cost and net book value
Investments in subsidiaries at beginning of year	1,633	168
Incorporation of subsidiaries	-	-
Additional payments to acquire subsidiary	138	40
	1,771	208
Loans reclassified to capital contributions in prior year**	-	956
Capital contributions in the year	280	469
	280	1,425
Investments in subsidiaries at end of year	2,051	1,633

On 5 December 2023, the Company paid a further cash consideration of £40,000 (including

registration fees) and one million shares valued at £31,000 using the share price on the day of

issue, to the other shareholders of Monte Muambe Mining Lda (“MMM”), to acquire a further

31% of the subsidiary as set in the Farm-Out Agreement. This has been recognised as an additional

cost of investment in the subsidiary.

Other payments totalling £67,000 made to the other shareholders during the year for stage

payments and extensions of phases were also capitalised as part of the cost of investment.

During the financial year, the Group acquired an additional 31% equity interest in MMM

increasing its total ownership from 20% to 51%. This transaction was accounted for as an equity

transaction in accordance with IFRS 10, as the Group retained control over the subsidiary before

and after the acquisition. The difference between the consideration paid of £71,000 and the

carrying amount of the non-controlling interests acquired of (net liabilities of £48,000) has been

recognised directly in equity as an adjustment to the parent’s equity. No goodwill or profit or

loss has been recognised in relation to this transaction, as control was not affected.

The Group is made up of the following subsidiaries:

Subsidiaries of
Altona Rare Earths
Plc
	Country of
	Registration
		Date of
		Incorporation
		/Acquisition
			Registered Address	Nature of Business and
				Holding
Altona Rare Earths
(Uganda) Limited
	Uganda	30 March
		2021
			Plot 2&4A Nakasero Road,
			Kampala, Uganda.
				100%	Mineral
					exploration
					and mining
Altona Rare Earths
(Tanzania) Limited
	Tanzania	5 August
		2021
			Plot No.466, Block 43,
			Mpakani A, Kinondoni,
			Tanzania.
				100%	Mineral
					exploration
					and mining

Altona Rare Earths
Maurtius Ltd
	Mauritius	17

		February
		2022
			c/o Griffon Solutions Ltd,
			C2-410, 4th
			Floor, Office
			Block C, Grand Baie,
			Mauritius
				100%	Business
					activities
Monte Muambe
Mining Lda
	Mozambique	23 June
		2021
			Avenida 24 de Julho, no
			851 R/C, Maputo,
			Mozambique.
				51%	Mineral
					exploration
					and mining
Altona Mozambique,
Lda*
	Mozambique	27 May
		2022
			c/o Griffon Solutions Ltd,
			C2-410, 4th
			Floor, Office
			Block C, Grand Baie,
			Mauritius
				95%	Mineral
					exploration
					and mining
Altona Mozambique
II, Lda*
	Mozambique	27 May
		2022
			c/o Griffon Solutions Ltd,
			C2-410, 4th
			Floor, Office
			Block C, Grand Baie,
			Mauritius
				95%	Mineral
					exploration
					and mining
Altona Mozambique
III, Lda*
	Mozambique	27 May
		2022
			c/o Griffon Solutions Ltd,
			C2-410, 4th
			Floor, Office
			Block C, Grand Baie,
			Mauritius
				100%	Mineral
					exploration
					and mining

*subsidiaries held indirectly through Altona Rare Earths Mauritius Ltd.

On 25 July 2023, Cedric Simonet transferred the 0.1% of the share capital of Altona

Mozambique, Lda and Altona Mozambique II, Lda that he was holding on behalf of Altona Rare

Earths Mauritius Limited to Altona Rare Earths Mauritius Limited, (both for nil

consideration), giving it a 100% total holding of the share capital in both companies.

On the same day, Altona Rare Earths Mauritius Limited, transferred 5% of the share capital of

Altona Mozambique, Lda and Altona Mozambique II Lda, (for nil consideration), to Ossanzaya

Empreendimentos Lda, a company registered in Mozambique.

** In the prior year a decision was taken by the Board to reclassify the loans due from MMM

to the Company into Investments (capital contributions) due to the nature of the Farm-Out

Agreement. The Board now view this loan as a long term investment in the company rather

than a non-interest bearing loan, repayable on demand.

11. INTANGIBLE ASSETS

The intangible assets held by the Group increased primarily as a result of the acquisition of

Monte Muambe Mining Lda (“MMM”) and the work carried out thereon. See note 10 for

further information.

	Exploration and
	evaluation assets

	£’000
Cost and carrying amount

At 1 July 2023
	1,290
Exploration and evaluation assets additions (see note 10)
	67
Additions to exploration assets
	250
At 30 June 2024
	1,607

On 25 September 2023, the Company published its Maiden Resource Estimate which reported

that there is an estimated 13.6 million tons at 2.42% TREO with a cut-off grade of 1.5% TREO.

The Scoping Study published on 18 October 2023 confirmed the potential viability of the

project and gave the Company sufficient confidence to proceed with the Prefeasibility Study

and with Phase 3 of the Farm-Out Agreement.

In accordance with IFRS 6, the Directors undertook an assessment of the following areas and

circumstances which could indicate the existence of impairment:

• The Group’s right to explore in an area has expired, or will expire in the near future without

renewal;

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

• A decision has been taken by the Board to discontinue exploration and evaluation in an

area due to the absence of a commercial level of reserves, and

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

development and production.

Following their assessment, and the publication of the MRE and Scoping Study, with the

potential economic viability of the project established therein, the Directors concluded that

no impairment charge in respect to any licences held, was necessary for the year ended 30

June 2024 (2023: £nil).

12. TANGIBLE FIXED ASSETS

GROUP	Buildings



	£’000
		Heavy
		machinery


		£’000
			Precision
			machinery
			and office
			equipment
			£’000
				Vehicles



				£’000
					Total
					Assets


					£’000
Cost
At 1 July 2023	31	86	33	24	174
Additions	4	3	4	-	11
At 30 June 2024	35	89	37	24	185
Accumulated
At 1 July 2023	1	13	7	7	28
Depreciation charge	1	27	6	6	40
At 30 June 2024	2	40	13	13	68
Net book value
At 30 June 2023	30	73	26	17	146
At 30 June 2024	33	49	24	11	117

COMPANY	Precision machinery
	and office equipment
	£’000
Cost
At 1 July 2023	7
At 30 June 2024	7
Accumulated depreciation
At 1 July 2023	3
Depreciation charge for the year	1
At 30 June 2024	4

Net book value
At 30 June 2023	4
At 30 June 2024	3

13. TRADE AND OTHER RECEIVABLES

	Group		Company

	2024
	£’000
		2023
		£’000
			2024
			£’000
				2023
				£’000

Receivables due from related parties	-	-	62	24
Taxes & Social security receivable	128	154	26	68
Prepayments and other receivables	46	14	36	14
	174	168	124	106

At 30 June 2024, the Group recognised an amount of £91,000 (2023: £80,000) within other

receivables which relates to VAT receivable from the Mozambique government. This includes a

provision for 23% (2023:25%) for non-recoverability. New legalisation in Mozambique has provided

a path for companies operating in the mining sector to seek reimbursement of VAT prior to the

production stage. Therefore, the Directors believe that the majority of this amount will be recovered

and have provided only for a portion to cover any costs/uncertainty associated with the recovery of

this receivable.

14. TRADE CREDITORS AND OTHER PAYABLES

	Group		Company

	2024
	£’000
		2023
		£’000
			2024
			£’000
				2023
				£’000

Trade payables	127	257	118	255
Accruals and other payables	458	336	455	335
	585	593	573	590

Convertible loan notes	292	256	292	256
Other loans (see note 15)	70	-	70	-
	362	256	362	256

Trade and other payables are non-interest bearing and are normally settled on terms of 30 days from

month end. The Directors consider that the carrying amount of financial liabilities recorded at

amortised cost in the financial statements approximate to their fair value.

CONVERTIBLE LOAN NOTES:

On 1 February 2023, the Company issued 5.5 million 15% convertible loan notes (“notes”) for

£275,000. These were convertible into ordinary shares of the entity, at the option of the holder, or

repayable on or before 1 May 2025. The conversion rate is 20 shares for every £1 note held, which

is based on the Fundraise issue price on 9th June 2023 of £0.05 per share.

On 24 June 2024, the Noteholders passed a written resolution to delete the Maturity Date and

convert these notes at a price of £0.01 per share. On 19

July 2024, £263,000 of the total loan notes

were converted and interest was calculated and paid up to the 30 June 2024.

The convertible loan notes are presented in the balance sheet as follows:

	£’000

Face value of notes issued	275
Less costs of issue	(32)
Other equity securities – value of conversion rights	(12)
	231
Interest expense*	25
Interest paid	-
Balance as at 30 June 2023	256
Interest expense*	77
Interest paid in the year	(41)
Balance as at 30 June 2024	292

*interest expense is calculated by applying the effective interest rate of 21.64% to the liability

component.

The initial fair value of the liability portion of the note was determined using a market interest rate

for a short term loan at the issue date, with a similar risk profile. The liability is subsequently

recognised on an amortised basis until extinguished on conversion or maturity of the notes. The

remainder of the proceeds is allocated to the conversion option and recognised in shareholders’

equity, and not subsequently remeasured.

The note holder has the option of receiving the interest in cash or the equivalent value in shares

which are priced at the VWAP for the previous 3 months. On conversion of the notes the note holders

were entitled to 2 warrants per share, priced at £0.10 and £0.15. They expire 2 years after grant.

Following the written resolution, the warrants were all repriced at £0.05 and extended to 31

December 2025.

There is not a material difference between the initial fair value of the notes and their carrying

amount, since the interest payable on those borrowings is close to the current market rate for such

a loan.

15. LOANS

	Group		Company

	2024
	£’000
		2023
		£’000
			2024
			£’000
				2023
				£’000

Loans	322	-	322	-

Movement in loans:	£’000

Balance as at 1 July 2023	-
Convertible loan from CCL – 20 December 2023	225
Interest expense	45
	270
New loan facility – draw downs	88
Interest charge on draw downs	34

Balance as at 30 June 2024	392
Balance due within one year (see note 14)	(70)
Balance due after one year	322

On 20 December 2023, the Company entered into a convertible loan note with Catalyse Capital

Limited (“CCL”) for a Commitment Amount of £250,000, with a repayment date of 20 December

2024 and a fixed interest charge of £50,000 (20%) amended to £45,000 (18%) on 30 March 2024.

The conversion price was set at the lower of £0.025 and the price of any subsequent equity raise (set

post year end at £0.01). CCL were also granted 12 million warrants representing 100% of the

Commitment Amount plus Fixed Interest divided by the subscription price of £0.025. £225,000 of

this facility was drawn down during the year. The number of these warrants was increased to 30

million following the equity raise on the 19 July 2024.

On 27 June 2024, the Company entered into a £300,000 debt facility with Mr Jennings, with a

repayment date of 30 October 2025, and a fixed interest rate of 12%. The loan is to be drawn down

in 8 tranches with £12,500 being drawn down before year end. £200,000 of the convertible loan

from CCL was reprofiled to match the terms of this debt facility and the remaining £70,000 of this

was converted into shares at a subscription price of £0.01 post year end (and reported in creditors

due within one year). Mr Jennings was also granted 30 million warrants at a subscription price of

£0.015.

On 27 June 2024, the Company also entered into a £600,000 debt facility with Tracarta Ltd, with a

repayment date of 30 October 2025, and a fixed interest rate of 12%. The loan is to be drawn down

in 8 tranches with £75,000 being drawn down before year end. Tracarta Ltd was also granted 105

million warrants at a subscription price of £0.015.

16. SHARE CAPITAL

	2024		2023
	No.	£’000	No.	£’000
Ordinary Shares

Ordinary shares at 1 July
	82,403,199	824	37,484,999	375
Shares issued in the year
	4,363,908	44	44,918,200	449
TOTAL ORDINARY SHARES at 30 June
	86,767,107	868	82,403,199	824


Deferred Shares at 0.09p

Deferred shares at 1 July
	1,411,956,853	1,271	1,411,956,853	1,271
Movement during the year
	-	-	-	-

	1,411,956,853	1,271	1,411,956,853	1,271
Deferred Shares at 9p

Deferred shares at 1 July
	1,602,434	144	1,602,434	144
Movement during the year
	-	-	-	-

	1,602,434	144	1,602,434	144


TOTAL DEFERRED SHARES at 30 June
	1,413,559,287	1,415	1,413,559,287	1,415


TOTAL SHARES at 30 June
	1,500,326,394	2,283	1,495,962,486	2,239

ORDINARY SHARES	Number of
	shares -
	ordinary
		Share
		Capital
			Share
			Premium
				Total

	No.	£’000	£’000	£’000
As at 30 June 2022
	37,484,999	375	21,404	21,779
Issued 9 June 2023
	40,000,000	400	1,600	2,000
Issued 9 June 2023
	4,918,200	49	197	246
Share issue costs
	-	-	(251)	(251)
As at 30 June 2023
	82,403,199	824	22,950	23,774
Issued 11 July 2023
	1,033,600	11	42	53
Issued 22 November 2023
	1,008,935	10	22	32
Issued 9 January 2024
	1,521,373	15	27	42
Issued 2 April 2024
	800,000	8	32	40
Share issue costs
	-	-	(1)	(1)

	86,767,107	868	23,072	23,940

• On 11 July 2023, the Company issued 1,033,600 shares to creditors in lieu of cash settlement for

fees of £53,000.

• On 22 November 2023, the Company issued 1 million shares to the other owners of MMM for the

acquisition of an additional 31% of MMM and 8,935 shares to a creditor in lieu of payment of cash

interest on the loans outstanding in the year.

• On 9 January 2024, the Company issued 1,521,373 shares to two Directors and one employee in

lieu of cash settlement of salary and fees due of £42,000.

• On 2 April 2024, the Company issued 800,000 shares to Sustineri Group Ltd for the transfer of the

exclusivity over the Tenement licence in Zambia.

PRIOR YEAR:

• On 9 June 2023, the Company raised gross proceeds of £2,000,000 through the placing and

subscription of 40 million ordinary shares of £0.01 each at a placing price of £0.05 per share. The

Company also issued 4,918,200 ordinary shares of £0.01 each at the placing price of £0.05 to pay

Directors and service providers in lieu of cash settlement.

The deferred shares do not have any voting rights nor carry dividend and distribution rights, however,

have the right on a return of assets on liquidation not exceeding the amount paid up on the deferred

shares as may be available after payment to each holder of ordinary shares the sum of £10,000 per

ordinary share.

PAID IN SHARE CAPITAL TO ISSUE

£345,000 was received in cash prior to the year end in relation to the fund raise which took place after

year-end on the 10 July 2024. This amount is classified as equity rather than a liability because

subscription documents have been obtained, confirming the investors’ commitment to equity

participation.

17. WARRANTS AND SHARE-BASED PAYMENTS

The Company has issued the following warrants, which are still in force at the date of this balance

sheet.

Date of Issue	Reason for issue	Number of
		Warrants
			Exercise
			Price
				Expiry date

Issued in 2021	Placing warrants	8,777,866	12p	31 March 2025
Issued 10 September 2021	Placing warrants	4,463,078	12p	31 March 2025
Issued 11 May 2022	Broker warrants 1	342,857	14p	6 October 2024
Issued 11 May 2022	Broker warrants 2	375,000	8p	24 April 2025
Issued 18 June 2022	Placing warrants	3,125,000	12p	31 March 2025
Issued 1 February 2023	CLN warrants**	11,000,000	5p	31 December 2025
Issued 9 June 2023	Admission warrants	40,000,000	10p	9 June 2025
Issued 9 June 2023	Admission piggyback warrants*	40,000,000	15p	9 June 2026
Issued 9 June 2023	Broker warrants 3	2,512,760	5p	9 June 2025
Issued 9 June 2023	CCL warrants 1***	7,500,000	5p	9 June 2026
Issued 9 June 2023	CLN Broker warrants	550,000	5p	9 June 2025
Issued 20 December 2023	CCL warrants 2***	12,000,000	2.5p	20 December 2027
Issued 27 June 2024	Debt facility warrants	135,000,000	1.5p	27 June 2028
		265,646,561

*These piggyback warrants are conditional on the exercise of the Admission warrants. If they are

exercised within 30 calendar days of the date on which the VWAP of the shares exceeds 10p. This

piggyback warrant will allow the warrant holder to subscribe for one share per each piggyback warrant

held.

**On 24 June 2024, the Noteholders passed a written resolution to convert their CLNs and to amend

the warrants attached to these shares to reprice them at £0.05 and extend their expiry date to 31

December 2025.

***Following the adjusting event of the fund raise on 19 July 2024, the CCL warrants 1 and 2 were

recalculated and repriced with respect to the equity raise price of £0.01, resulting in the replacement

of these warrants with 67.5 million warrants with an exercise price of £0.01.

The following table sets out the movement of warrants during the year, no warrants were exercised

during either year:

	Number of warrants	Exercise price
		(pence)

As at 30 June 2022	18,183,801	8p to 14p
Issued in the year	50,562,760	5p to 10p
	68,746,561
Piggyback and CLN warrants	51,000,000	10p to 20p
As at 30 June 2023	119,746,561	5p to 12p
Issued in the year	147,000,000	1.5p to 2.5p
Expired in the year	(1,100,000)	12p
As at 30 June 2024	265,646,561	1.5p to 20p

Recalculated* post year end – CCL Warrants 1 and 2	(19,500,000)	2.5p to 5p
Recalculated* post year end – CCL Warrants 3	67,500,000	1.0p
	313,646,561	1p to 20p

*Following the equity raise on 19 July 2024, the CCL warrants 1 and 2 were recalculated and repriced

with respect to the equity raise price of £0.01, as per the conditions of the contract.

The weighted average price of all warrants at the year end is £0.58 (2023: £0.11) and weighted average

life of these warrants is 2.78 years (2023: 2.13 years).

SHARE-BASED PAYMENTS

	Share-based payment reserve

	£’000


At 1 July 2022
	14
Cost of shares issued
	41
Share-based payment charge
	66
At 30 June 2023
	121
Share-based payment charge	353
At 30 June 2024
	474

The debt facility warrants (£900,000 facility entered into on the 27 June 2024) were fair valued at

£270,000. The CCL warrants 2 were initially fair valued at £46,000 and then following the adjustment

in number and price were revalued at £73,000. The CCL warrants 1 were initially fair valued at £61,000

in the prior year and then following the adjusted number and price were revalued at £71,000 resulting

in a further £10,000 charged to the profit and loss account. In accordance with IFRS 2, these warrants

were classed as equity settled share-based payment transactions. These amounts are attributable to

the cost of finance and therefore have been accounted for in the profit and loss account in the year.

The fair values in the year were calculated using the Black Scholes model with inputs as detailed below:

	Debt facility
	warrants
		CCL warrants 2
		initial
			CCL warrants 2
			adjusted
				CLN warrants 1
				adjusted
Number of warrants	135,000,000	12,000,000	30,000,000	37,500,000
Share price	1.05p	2.25p	1.05p	1.05p
Exercise price	1.5p	2.5p	1.0p	1.0p
Expected life	4 years	4 years	3.5 years	2 years
Volatility	57%	42%	57%	57%
Risk-Free Interest rate	4.17%	4.03%	4.17%	4.17%
Expected dividends	-	-	-	-
Fair Values	£270,000	£46,000	£73,000	£71,000

Expected volatility has been based on an evaluation of the historical volatility of the Company’s share

price. The fair value has been discounted by 50% to account for the early-stage development of the

Company and limited liquidity due to its small capital nature.

PRIOR YEAR

The Placing and Admission warrants were issued to investors as part of new share placings. These

investor warrants have been determined as equity instruments under IAS 32. Since the fair value of

the shares issued at the same time is equal to the price paid, these warrants, by deduction, are

considered to have been issued at nil value.

The Broker 3 warrants are made up of 2,012,760 warrants and 500,000 performance warrants. The

performance warrants are valued at the contracted value of £25,000 and the remaining warrants have

been fair valued at £16,497 in accordance with IFRS 2 as equity settled share-based payment

transactions. £16,497 has been recognised as the fair value of Broker warrants issued as part of the

share raise in the year. These amounts are attributable to the cost of shares issued and therefore have

been accounted for in the Share Premium reserve.

The CCL warrants 1 have been fair valued at £61,471 in accordance with IFRS 2 as equity settled share-

based payment transactions. £61,471 has been recognised as the fair value of the cost of extending

the CCL loan during the year. This amount is attributable to the cost of finance and therefore has been

accounted for in the profit and loss account in the year.

The CLN Broker warrants have been fair valued at £4,483 in accordance with IFRS 2 as equity settled

share-based payment transactions. £4,483 has been recognised as the fair value of the cost of issue

of the CLNs and has been net off the liability held in the balance sheet for these notes.

The fair values in prior year were calculated using the Black Scholes model with inputs as detailed

below:

	Broker
	warrants 1
		Broker
		warrants 2
			Broker
			warrants 3
				CCL
				Warrants 1
					CLN Broker
					warrants
Number of warrants	342,857	375,000	2,012,760	7,500,000	550,000
Share price	11.5p	9p	5p	5p	6.1p
Exercise price	14p	8p	5p	5p	5p
Expected life	3 years	3 years	3 years	3 years	2 years
Volatility	31%	31%	40%	40%	40%
Risk-Free Interest rate	0.13%	0.13%	5.04%	5.04%	3.66%
Expected dividends	-	-	-	-	-
Fair Values	£5,613	£8,836	£16,497	£61,471	£4,483

18. RESERVES AND NCI

The following describe the nature and purpose of each reserve within owners’ equity:

Reserve	Description and Purpose
Share capital	Amount subscribed for share capital at nominal value
Share premium	Amount subscribed for share capital in excess of nominal value.
Paid in share capital to
issue
	Money received in advance for share capital subscribed for at total
	value.
Share-based payment
reserve
	Reserve created to recognise share-based payments such as
	warrants used in lieu of cash settlement.
Convertible loan note
(CLN) reserve
	The value of the conversion portion of the CLN, calculated as the
	proceeds, less amortised cost, less fair value.
Non-controlling
Interest
	Reserve created to recognise the Non-controlling interest at year
	end.
Retained deficit	Cumulative net gains and losses recognised in the consolidated
	statement of comprehensive income.

19. COMMITMENTS AND CONTINGENT LIABILITIES

As at 30 June 2024 the only significant capital commitments of the Group relate to the Farm-Out

Agreement in Mozambique which sets out a minimum spend for each phase of the project. On 23

October 2023, the Company notified the original shareholders of Monte Muambe Mining Lda of the

successful completion of Phase 2 and of its intention to proceed to Phase 3 of the Project. The

committed minimum spend for this Phase 3 is $2m over 2 years. This Phase and the related capital

commitments can be extended with further payments.

20. RELATED PARTY TRANSACTIONS

Transactions with group undertakings:

Balances and transactions between the Company and its subsidiaries, which are related parties, have

been eliminated on consolidation.

Amounts owed to the parent company by subsidiaries are as follows:

	2024	2023
	£’000	£’000

Monte Muambe Mining Lda	1,705	1,425
Altona Rare Earths (Tanzania) Limited	4	5
Altona Rare Earths Mauritius Ltd	58	19

Transactions with key management:

The key management personnel are considered to be the Directors. Details of their remuneration are

included in the remuneration report. Remuneration was paid in shares and cash during the year. As

at 30 June 2024, deferred salaries, fees and Employer’s NI in relation to Directors and Senior

Management amounted to £199,000 (2023:£40,000) and was included in accrued expenses at year

end. This was settled in cash and shares post year-end.

Transactions with other related parties:

Louise Adrian also works as a consultant for Orana Corporate LLP who provide the Company with

accounting and bookkeeping services and are the corporate Company Secretary for the Company.

During the year these services cost the Company £48,000 (2023: £48,000).

21. CONTROLLING PARTY

The Directors consider that there is no single controlling party.

22. POST REPORTING DATE EVENTS

On 19 July 2024, the Company announced the issue of 76,248,759 new ordinary shares as follows:

• 39,400,000 Shares were issued to raise funds of £394,000;

• 33,300,000 Shares were issued for the conversion of existing convertible loan notes of

£303,000; and

• 3,548,759 Shares were issued to certain Directors in lieu of fees and to various other creditors.

On 29 July 2024, the Company announced it had exercised its option to acquire a 51% share in the

prospecting licence PL2329/2023, in Botswana from Ignate African Mineral (Pty) Ltd for an initial

consideration of USD$10,000 in cash and USD$50,000 in shares. The minimum expenditure

commitment is USD$100,000 for a 12 month period.