Notes to the Condensed Consolidated Financial Statements

for the six months ended 30 June 2022 and 2021,

and the year ended 31 December 2021

All tabulated amounts stated in thousands of United States dollar (unless otherwise stated)

1.     General information

The principal activity of Cora Gold Limited (the 'Company') and its subsidiaries (together the 'Group') is the exploration and development of mineral projects, with a primary focus in West Africa. The Company is incorporated and domiciled in the British Virgin Islands. The address of its registered office is Rodus Building, Road Reef Marina, P.O. Box 3093, Road Town, Tortola VG1110, British Virgin Islands.

The condensed consolidated interim financial statements of the Group for the six months ended 30 June 2022 comprise the results of the Group and have been prepared in accordance with AIM Rules for Companies. As permitted, the Company has chosen not to adopt IAS 34 'Interim Financial Reporting' in preparing these interim financial statements.

The condensed consolidated interim financial statements for the period 01 January to 30 June 2022 are unaudited. In the opinion of the directors the condensed consolidated interim financial statements for the period present fairly the financial position, and results from operations and cash flows for the period in conformity with generally accepted accounting principles consistently applied. The condensed consolidated interim financial statements incorporate unaudited comparative figures for the interim period 01 January to 30 June 2021 and extracts from the audited consolidated financial statements for the year ended 31 December 2021.

The interim report has not been audited or reviewed by the Company's auditor.

The key risks and uncertainties and critical accounting estimates remain unchanged from 31 December 2021 and the accounting policies adopted are consistent with those used in the preparation of its financial statements for the year ended 31 December 2021.

As at 30 June 2022 and 2021, and 31 December 2021 the Company held:

●   a 100% shareholding in Cora Gold Mali SARL (registered in the Republic of Mali; the address of its registered office is Rue 224 Porte 1279, Hippodrome 1, BP 2788, Bamako, Republic of Mali);

●   a 100% shareholding in Cora Exploration Mali SARL (the address of its registered office is Rue 224 Porte 1279, Hippodrome 1, BP 2788, Bamako, Republic of Mali); and

●   a shareholding in Sankarani Ressources SARL (the address of its registered office is Rue 841 Porte 202, Faladiè SEMA, BP 366, Bamako, Republic of Mali);

and Cora Resources Mali SARL (registered in the Republic of Mali; the address of its registered office is Rue 841 Porte 202, Faladiè SEMA, BP 366, Bamako, Republic of Mali) was a wholly owned subsidiary of Sankarani Ressources SARL.

The remaining 5% of Sankarani Ressources SARL can be purchased from a third party for US$1,000,000.

2.     Earnings per share

The calculation of the basic and fully diluted earnings per share attributable to the equity shareholders is based on the following data:

As at 30 June 2022, 2021 and 31 December 2021 the Company's issued and outstanding capital structure comprised a number of ordinary shares and share options (see Note 7).

3.     Intangible assets

Intangible assets relate to exploration and evaluation project costs capitalised as at 30 June 2022 and 2021, and 31 December 2021, less impairment.

Additions to project costs during the six months ended 30 June 2022 and 2021, and the year ended 31 December 2021 were in the following geographical areas:

Impairment of project costs during the six months ended 30 June 2022 and 2021, and the year ended 31 December 2021 relate to the following terminated projects:

Those projects which were terminated were considered by the directors to be no longer prospective.

Project costs capitalised as at 30 June 2022 and 2021, and 31 December 2021 related to the following geographical areas:

4.     Trade and other receivables

5.     Cash and cash equivalents

Cash and cash equivalents held as at 30 June 2022 and 2021, and 31 December 2021 were in the following currencies:

6.     Trade and other payables

7.     Share capital

The Company is authorised to issue an unlimited number of no par value shares of a single class.

As at 31 December 2020 the Company's issued and outstanding capital structure comprised:

●   205,382,159 ordinary shares;

●   share options over 1,900,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022;

●   share options over 6,200,000 ordinary shares in the capital of the Company exercisable at 8.5 pence (British pound sterling) per ordinary share expiring on 09 October 2023; and

●   share options over 7,200,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025.

During the six months ended 30 June 2021:

●   on 09 June 2021 the Company closed a subscription for 40,425,000 ordinary shares in the capital of the Company at a price of 7.75 pence (British pound sterling) per ordinary share for total gross proceeds of GBP£3,132,937.50 - certain directors of the Company participated in this subscription;

●   on 15 June 2021 share options over 275,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022 were cancelled;

●   on 30 June 2021 share options over 100,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025 were cancelled.

As at 30 June 2021 the Company's issued and outstanding capital structure comprised:

●   245,807,159 ordinary shares;

●   share options over 1,625,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022;

●   share options over 6,200,000 ordinary shares in the capital of the Company exercisable at 8.5 pence (British pound sterling) per ordinary share expiring on 09 October 2023; and

●   share options over 7,100,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025.

During the six months ended 31 December 2021:

●   on 06 September 2021 share options were exercised over 1,250,000 ordinary shares in the capital of the Company at a price of 8.5 pence (British pound sterling) per ordinary share expiring on 09 October 2023 for total gross proceeds of GBP£106,250;

●   on 08 December 2021:

○  the Company closed a placing and subscription for 42,500,000 ordinary shares in the capital of the Company at a price of 10 pence (British pound sterling) per ordinary share for total gross proceeds of GBP£4,250,000 - certain directors of the Company participated in this subscription;

○  the board of directors granted and approved share options over 7,850,000 ordinary shares in the capital of the Company exercisable at 10.5 pence (British pound sterling) per ordinary share expiring on 08 December 2026;

●   on 31 December 2021:

○  share options over 400,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022 were cancelled; share options over 2,500,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025 were cancelled;

○  share options over 1,200,000 ordinary shares in the capital of the Company exercisable at 10.5 pence (British pound sterling) per ordinary share expiring on 08 December 2026 were cancelled.

As at 31 December 2021 the Company's issued and outstanding capital structure comprised:

●   289,557,159 ordinary shares;

●   share options over 1,225,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022;

●   share options over 4,950,000 ordinary shares in the capital of the Company exercisable at 8.5 pence (British pound sterling) per ordinary share expiring on 09 October 2023;

●   share options over 4,600,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025; and

●   share options over 6,650,000 ordinary shares in the capital of the Company exercisable at 10.5 pence (British pound sterling) per ordinary share expiring on 08 December 2026.

During the six months ended 30 June 2022:

●   on 14 May 2022 share options over 100,000 ordinary shares in the capital of the Company exercisable at 10.5 pence (British pound sterling) per ordinary share expiring on 08 December 2026 were cancelled.

As at 30 June 2022 the Company's issued and outstanding capital structure comprised:

●   289,557,159 ordinary shares;

●   share options over 1,225,000 ordinary shares in the capital of the Company exercisable at 16.5 pence (British pound sterling) per ordinary share expiring on 18 December 2022;

●   share options over 4,950,000 ordinary shares in the capital of the Company exercisable at 8.5 pence (British pound sterling) per ordinary share expiring on 09 October 2023;

●   share options over 4,600,000 ordinary shares in the capital of the Company exercisable at 10 pence (British pound sterling) per ordinary share expiring on 12 October 2025; and

●   share options over 6,550,000 ordinary shares in the capital of the Company exercisable at 10.5 pence (British pound sterling) per ordinary share expiring on 08 December 2026.

Movements in capital during the six months ended 30 June 2022 and 2021, and the year ended 31 December 2021 were as follows:

8.     Ultimate controlling party

The Company does not have an ultimate controlling party.

As at 30 June 2022 the Company's largest shareholder was Brookstone Business Inc ('Brookstone') which held 82,796,025 ordinary shares, being 28.59% of the total number of ordinary shares issued and outstanding. Brookstone is wholly owned and controlled by First Island Trust Company Ltd as Trustee of The Nodo Trust, being a discretionary trust with a broad class of potential beneficiaries. Patrick Quirk, father of Paul Quirk (Non-Executive Director of the Company), is a potential beneficiary of The Nodo Trust.

Brookstone, Key Ventures Holding Ltd ('KVH') and Paul Quirk (Non-Executive Director of the Company) (collectively the 'Investors'; as at 30 June 2022 their aggregated shareholdings being 33.32% of the total number of ordinary shares issued and outstanding) have entered into a Relationship Agreement to regulate the relationship between the Investors and the Company on an arm's length and normal commercial basis. In the event that Investors' aggregated shareholdings becomes less than 30% then the Relationship Agreement shall terminate. KVH is wholly owned and controlled by First Island Trust Company Ltd as Trustee of The Sunnega Trust, being a discretionary trust of which Paul Quirk (Non-Executive Director of the Company) is a potential beneficiary.

9.     Contingent liabilities

On 07 September 2021 the Company entered into a US$25 million mandate and term sheet (the 'Term Sheet') with investment firm Lionhead Capital Advisors Proprietary Limited ('Lionhead') to fund the development of the Company's Sanankoro Gold Project in southern Mali (the 'Project Financing'). This is conditional on, among other matters, the completion of a Definitive Feasibility Study ('DFS') on the Sanankoro Gold Project. Paul Quirk (Non-Executive Director of the Company) is a director of Lionhead. The Project Financing comprises US$12.5 million equity ('Equity Financing') and US$12.5 million convertible loan note ('Convertible Financing'). Lionhead acknowledges that the Company intends to undertake private placements to enable existing shareholders to subscribe for up to US$3.75 million in the Equity Financing and up to US$3.75 million in the Convertible Financing such that Lionhead's participation in the Project Financing may be reduced by such amounts. A fee equal to 3% on up to US$25 million Project Financing shall be paid by the Company to Lionhead on receipt of the proceeds in respect of the Equity Financing and Convertible Financing participated by Lionhead.

A number of the Company's project areas have potential net smelter return royalty obligations, together with options for the Company to buy out the royalty. At the current stage of development, it is not considered that the outcome of these contingent liabilities can be considered probable or reasonably estimable and hence no provision has been recognised in the financial statements.

10.   Capital commitments

The Company has entered into contracts with a number of contractors in respect of the DFS for the Sanankoro Gold Project. The DFS contractors include, among others:

●   New SENET (Pty) Ltd, independent project manager;

●   CSA Global (UK) Ltd, geological and mining consultants;

●   Epoch Resources (Pty) Ltd, tailings storage facility consultants; and

●   Digby Wells Environmental (Jersey) Limited, environmental and social impact assessment ('ESIA') consultants.

As at 30 June 2022 total estimated costs in respect of the DFS contractors are approximately US$2,067,000. As at 30 June 2022, 2021 and 31 December 2021 under the terms of the contracts the Company had incurred costs of approximately US$1,990,000, approximately US$75,000 and approximately US$1,080,000 respectively. The DFS is expected to be completed in the third quarter of 2022.

11.   Events after the reporting date

In July 2022 the ESIA was completed and formally submitted to the Mali authorities. In due course, further material to address any matters raised by the Mali authorities, and an updated and final ESIA submission will be tendered.

In August 2022 the Company entered into additional contracts in respect of the DFS for the Sanankoro Gold Project. Total estimated costs in respect of these additional DFS contracts are approximately US$39,000.

12.   Approval of condensed consolidated interim financial statements

The condensed consolidated interim financial statements were approved and authorised for issue by the board of directors of Cora Gold Limited on 02 September 2022.

**ENDS**